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HomeMy WebLinkAbout2009-12-02 ORDINANCE NO.d(b7—(a ,a • AN ORDINANCE AUTHORIZING THE CONSTRUCTION OF EXTENSIONS, BETTERMENTS AND IMPROVEMENTS TO THE SEWER FACILITIES OF THE CITY OF BATESVILLE, ARKANSAS; AUTHORIZING THE ISSUANCE OF A WATER AND SEWER REVENUE BOND FOR THE PURPOSE OF FINANCING A PORTION OF THE COST OF CONSTRUCTION; PROVIDING FOR THE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE BOND; AND PRESCRIBING OTHER MATTERS RELATING THERETO. WHEREAS, the City of Batesville, Arkansas (the "City") owns and operates a water and sewer system as a single, integrated municipal undertaking(the "System"); and WHEREAS, the City Council of the City has determined that extensions, betterments and improvements to the sewer facilities of the System (the "Improvements") are necessary in order to make the services of the System adequate for the needs of the City; and WHEREAS, in order to finance a portion of the costs of the Improvements, including bond issuance costs, the City is making arrangements for the sale of a $6,300,000 • principal amount bond to the Arkansas Development Finance Authority, as purchaser (the "Bondholder"), at a price of par for a bond bearing interest at the rate of 1.50% per annum pursuant to a Bond Purchase Agreement (the "Agreement") among the City, the Bondholder and the Arkansas Natural Resources Commission (the "Commission"), which has been presented to and is before this meeting; and WHEREAS, the City has outstanding its Water and Sewer Revenue Refunding Bonds, Series 2001 (the "2001 Bonds") authorized by Ordinance No. 2001-3-1 adopted March 13, 2001 (the "2001 Ordinance"); and WHEREAS, the City has outstanding its Water and Sewer Revenue Refunding Bonds, Series 2002 (the "2002 Bonds") authorized by Ordinance No. 2002-6-02 adopted June 25, 2002 and Ordinance No. 2002-8-2 adopted August 27, 2002 (collectively, the "2002 Ordinance"); and WHEREAS, the City is authorized, under the provisions of Amendment No. 65 to the Arkansas Constitution, Title 14, Chapter 234, Subchapter 2 of the Arkansas Code of 1987 Annotated (the "Code"), Title 14, Chapter 164, Subchapter 4 of the Code, and Title 14, Chapter 235, Subchapter 2 of the Code (collectively, the "Authorizing Legislation"), to issue and sell the bond; and • WHEREAS, the City is required to pay to the Arkansas Development Finance • Authority, as servicer (the "Authority"), a financing fee equal to 1% per annum of the outstanding principal amount of the bond(the "Financing Fee"); and WHEREAS, the Commission is receiving a federal grant under the American Recovery and Reinvestment Act of 2009 ("ARRA") and, pursuant to the terms of the grant, the Bondholder and the Commission agreed to forgive principal of the Bond as advances are made against the purchase price; and WHEREAS, the expenditures of the proceeds of the Bond for the Improvements are subject to the specific requirements of ARRA; NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Batesville, Arkansas: Section 1. The sale to the Bondholder of up to $6,300,000 in principal amount of a bond from the City at a price of par for a bond bearing interest at the rate of 1.50% per annum and otherwise subject to the terms and provisions hereafter in this Ordinance set forth in detail is hereby approved and the bond is hereby sold to the Bondholder. The Mayor is hereby authorized and directed to execute and deliver the Agreement on behalf of the City and to take all action required on the part of the City to fulfill its obligations under the Agreement. The Agreement is hereby approved in substantially the form submitted to this meeting with such changes as may be approved by the Mayor, his execution to constitute complete evidence of such • approval. Section 2. The City Council of the City hereby finds and declares that the period of usefulness of the System after completion of the Improvements will be more than 25 years, which is longer than the term of the bond. Section 3. Under the authority of the Constitution and laws of the State of Arkansas (the "State"), including particularly the Authorizing Legislation and applicable decisions of the Supreme Court of the State, including particularly City of Harrison v. Braswell, 209 Ark. 1094, 194 S.W.2d 12 (1946), City of Batesville, Arkansas Water and Sewer Revenue Bond, Series 2010 (the "bond") is hereby authorized and ordered issued in the principal amount of$6,300,000, the proceeds of the sale of which will be used to accomplish the Improvements, pay expenses incidental thereto and pay expenses of issuing the bond. The bond shall bear interest at the rate of 1.50%per annum based upon a 360-day year of twelve consecutive 30-day months. The bond shall be dated the date of delivery to the Bondholder. Interest shall be payable on each April 15 and October 15 after the bond is issued. Principal shall be payable in installments on April 15, 2013 and each April 15 and October 15 thereafter until the unpaid principal is paid in full as follows: 2 • Date Amount Date Amount 04/15/13 $122,355 04/15/23 $156,863 10/15/13 123,885 10/15/23 158,825 04/15/14 125,433 04/15/24 160,810 10/15/14 127,001 10/15/24 162,820 04/15/15 128,588 04/15/25 164,855 10115115 130,195 10/15/25 166,915 04/15/16 131,823 04/15/26 169,002 10/15/16 133,471 10/15/26 171,115 04/15/17 135,140 04/15/27 173,253 10/15/17 136,828 10/15/27 175,420 04/15/18 138,539 04/15/28 177,612 10/15/18 140,270 10/15/28 179,832 04/15/19 142,024 04/15/29 182,080 10/15/19 143,800 10/15/29 184,356 04/15/20 145,597 04/15/30 186,660 10/15/20 147,417 10/15/30 188,994 04/15/21 149,260 04/15/31 191,357 10/15/21 151,125 10/15/31 193,748 04/15/22 153,015 04/15/32 196,170 10/15/22 154,927 10/15/32 198,620 0 The bond will be registered as to both principal and interest, payable to the Bondholder, or registered assigns, as set forth hereinafter in the bond form, and shall be numbered R-1. Payment of principal and interest shall be by check or draft mailed to the Bondholder at its address shown on the bond registration books of the City which shall be maintained by the City Clerk as Bond Registrar, without presentation or surrender of the bond (except upon final payment) and such payments shall discharge the obligation of the City to the extent thereof. The City Clerk shall keep a payment record and make proper notations thereon of all payments of principal and interest. Payment of principal and interest shall be in any coin or currency of the United States of America which, as at the time of payment, shall be legal tender for the payment of debts due the United States of America. When the principal of and interest on the bond have been fully paid or forgiven, it shall be canceled and delivered to the City Clerk. Section 4. The bond shall be executed on behalf of the City by the Mayor and City Clerk and shall have impressed thereon the seal of the City. The bond is not a general obligation of the City but is a special obligation, the principal of and interest on which, and Financing Fee in connection therewith, are secured by a pledge of and are payable from revenues derived from the System ("Revenues"). The pledge of Revenues is subordinate to the pledge in • 3 favor of the 2001 Bonds and the 2002 Bonds (the "Senior Bonds"). The bond and interest thereon shall not constitute an indebtedness of the City within any constitutional or statutory limitation. Section 5. The bond shall be in substantially the following form and the Mayor and City Clerk are hereby authorized and directed to make all the recitals contained therein: (form of single registered bond) (To be typewritten) UNITED STATES OF AMERICA STATE OF ARKANSAS COUNTY OF INDEPENDENCE CITY OF BATESVILLE 1.50%WATER AND SEWER REVENUE BOND, SERIES 2010 No. R-1 $6,300,000 KNOW ALL MEN BY THESE PRESENTS: That the City of Batesville, Independence County, Arkansas (the "City"), for value received, hereby acknowledges itself to owe and promises to pay to the Arkansas Development Finance Authority, or registered assigns, solely from the special fund provided as • hereinafter set forth, the principal sum of SIX MILLION THREE HUNDRED THOUSAND DOLLARS (or the total principal amount outstanding as reflected by the Record of Payment of Advances attached hereto) with interest on the unpaid balance of the total principal amount at the rate of 1.50% per annum from the date of each advance. The principal and interest shall be payable in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of debts due the United States of America. Interest on the unpaid balance of the total principal amount shall be payable on April 15, 2010 and on each April 15 and October 15 thereafter. Principal shall be payable in installments on April 15, 2013 and on each April 15 and October 15 thereafter until the unpaid principal is paid as follows: Date Amount (There will be inserted the schedule set forth in Section 3 of the Ordinance.) 4 Payments of the principal and interest installments due hereon shall be made, except for final payment, without presentation and surrender of this bond, directly to the • registered owner at his address shown on the bond registration book of the City maintained by the City Clerk as Bond Registrar, and such payments shall fully discharge the obligation of the City to the extent of the payments so made. This bond is issued for the purpose of providing financing of a portion of the costs of constructing extensions, betterments and improvements to the sewer facilities of the water and sewer system of the City (the "System"), and costs of authorizing and issuing this bond, and is issued pursuant to and in full compliance with the Constitution and laws of the State of Arkansas (the "State"), including particularly Title 14, Chapter 234, Subchapter 2, Title 14, Chapter 164, Subchapter 4, and Title 14, Chapter 235, Subchapter 2, of the Arkansas Code of 1987 Annotated and applicable decisions of the Supreme Court of Arkansas, including particularly City of Harrison v. Braswell, 209 Ark. 1094, 194 S.W.2d 12 (1946), and pursuant to Ordinance No. of the City, duly adopted and approved on the 22nd day of December, 2009 (the "Authorizing Ordinance"). Reference is hereby made to the Authorizing Ordinance for the details of the nature and extent of the security and of the rights and obligations of the City and the registered owner of this bond. This bond may be assigned to the Arkansas Natural Resources Commission (the "Commission"), and in order to effect such assignment the assignor shall promptly notify the City Clerk by registered mail, and the Commission shall surrender this bond to the City Clerk for transfer on the registration records. The Commission shall take this bond subject to all payments and prepayments of principal and interest (as reflected by the Payment Record maintained by the • City Clerk), prior to such surrender for transfer. This bond may be prepaid at the option of the City from funds from any source, in whole but not in part, at any time on and after April 15, 2020, at a prepayment price equal to the principal amount outstanding, plus accrued interest to the prepayment date. Notice shall be given of such prepayment to the owner of this bond or registered assigns at least 90 days prior to the prepayment date. Such notice shall be in writing mailed to the address of the owner of this bond or registered assigns at the address as reflected on the bond registration books of the City Clerk. This bond does not constitute an indebtedness of the City within any constitutional or statutory limitation or provision, and the taxing power of the City is not pledged to the payment of the principal of or interest on this bond. This bond is a special obligation payable solely from the revenues derived from the operation of the System. In this regard, the pledge of System revenues is subordinate to the pledge of System revenues to the Senior Bonds identified in the Authorizing Ordinance. A sufficient amount of System revenues to pay principal and interest has been duly set aside and pledged as a special fund for that purpose, identified as the "ADFA Bond Fund," in the Authorizing Ordinance. The City has fixed and has covenanted and agreed to maintain rates for use of the System which shall be sufficient at all times to at least provide for the payment of the reasonable expenses of operation and maintenance of the System, provide for the payment of the principal of and interest on all the outstanding bonds to which System revenues are pledged as the same become due, to establish 5 and maintain debt service reserves and to provide a depreciation fund, all as set forth in the Authorizing Ordinance. ® IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and things required by the Constitution and statutes of the State to exist, happen and be performed precedent to and in the issuance of this bond do exist, have happened and have been performed in regular and due time, form and manner as required by law; that this bond does not exceed any constitutional or statutory limitation of indebtedness; and that provision has been made for the payment of the principal of and interest on this bond, as provided in the Authorizing Ordinance. IN WITNESS WHEREOF, the City of Batesville, Arkansas has caused this bond to be executed in its name by its Mayor and City Clerk, thereunto duly authorized, and its corporate seal to be affixed, all as of the day of 2010. [The Bond shall contain signature spaces, a registration certificate and record of payment of advances.] Section 6. The rates charged for services of the System heretofore fixed by ordinances of the City and the conditions, rights and obligations pertaining thereto, as set out in those ordinances, are ratified, confirmed and continued. The City covenants and agrees that the rates established will produce gross Revenues at least sufficient to pay monthly operation, maintenance and funded depreciation • expenses of the System, pay the principal of and interest on all outstanding bonds to which Revenues are pledged ("System Bonds"), as the same become due, pay the Financing Fees as the same become due, and create and maintain any required debt service reserves ("Required Payments"). The City covenants always to maintain rates (including increases as necessary) which will provide for the Required Payments. The rates for sewer service shall not be reduced without the prior written consent of the Commission and the Bondholder. Section 7. All of the provisions of the 2001 Ordinance and the 2002 Ordinance (the "Senior Ordinances"), except those provisions clearly inapplicable hereto or in direct conflict herewith, including, without limitation, the provisions pertaining to the collection, the investment and the handling of Revenues and funds, to the operation, maintenance and care of the System, to vacancies in offices, and to the depreciation of the System, are hereby made applicable hereto and are incorporated herein by reference as though fully set forth at this point. The effect of the above covenant shall be to continue the applicable provisions in full force and effect until the bond is paid, or provision made therefor, even after the payment of the Senior Bonds. Section 8. The City covenants that it will continuously operate the System as a revenue-producing undertaking and will not sell or lease the same, or any substantial portion thereof, without the prior written approval of the Bondholder and the Commission; provided, however, that nothing herein shall be construed to prohibit the City from making such dispositions of properties of the System and such replacements and substitutions for properties of 0 6 the System as shall be necessary or incidental to the efficient operation of the System as a revenue-producing undertaking. • Section 9. (a) After making the required payments into the Water and Sewer Operation and Maintenance Fund being maintained in accordance with the Senior Ordinances and into the bond funds for the Senior Bonds and any additional bonds having a priority on the pledge of Revenues over the pledge in favor of the bond, there shall be paid from the Water and Sewer Revenue Fund (the "Revenue Fund") being maintained in accordance with the Senior Ordinances into an account of the City in a special fund to be created by the Bondholder and designated "Series 2010" (the "ADFA Bond Fund") for the purpose of paying the principal of and interest on the bond the amounts specified in(b)below. (b) In order to pay interest on the bond, there shall be deposited from moneys in the Revenue Fund into the ADFA Bond Fund on each interest payment date to and including October 15, 2012, the interest due on the bond on such dates. Commencing on the first business day of each month thereafter, there shall be deposited from moneys in the Revenue Fund into the ADFA Bond Fund an amount equal to 1/6 of the amount of principal of and interest on the bond next due. (c) If Revenues are insufficient to make the required payment on or before the first business day of the following month into the ADFA Bond Fund, then the amount of any such deficiency in the payment made shall be added to the amount otherwise required to be paid into the ADFA Bond Fund on the first business day of the next month. • (d) When the moneys held in the ADFA Bond Fund which represent payments by the City and interest earnings thereon or proceeds of investments therefrom (collectively, "City Funds") shall be and remain sufficient to pay in full the principal of and interest on the bond, the City shall not be obligated to make any further payments into the ADFA Bond Fund. (e) All moneys in the ADFA Bond Fund representing City Funds shall be used solely for the purpose of paying the principal of and interest on the bond and the City shall automatically receive a credit for the amount of such City Funds on hand in the ADFA Bond Fund and available for the payment of any principal and interest currently due on an interest or principal payment date irrespective of whether the Bondholder has applied or caused to be applied such funds on that date for such purpose. The City shall receive a credit for all earnings and income derived from the investment of City Funds each April 15 and October 15 and such earnings and income shall be credited against the next six monthly payments. (f) The bond shall be specifically secured by a pledge of all Revenues required to be placed into the ADFA Bond Fund. This pledge in favor of the bond is hereby irrevocably made according to the terms of this Ordinance, and the City and its officers and employees shall execute, perform and carry out the terms thereof in strict conformity with the provisions of this Ordinance. • 7 Section 10. After making the payments into the ADFA Bond Fund required by Section 9 hereof, there shall be paid from moneys in the Revenue Fund the Financing Fee to the • Authority. The Financing Fee shall be payable on each date interest on the bond is due and shall be calculated on the same basis as interest on the bond. The payment of the Financing Fee is expressly made subordinate to the payment of the principal of and interest on the bond. Section 11. The City shall assure that there will be no Private Business Use of the Improvements that will cause the bond to be a "private activity bond" within the meaning of Section 141 of the Internal Revenue Code of 1986, as amended. As used in this Section, "Private Business Use" means use directly or indirectly in a trade or business carried on by a natural person or in any activity carried on by a person other than a natural person, excluding, however, use by a state or local governmental unit and use as a member of the general public. Section 12. The principal and interest installments shall be prepayable prior to maturity as provided in the bond form in Section 5 hereof. Section 13. As long as the bond is outstanding, the City shall not issue or attempt to issue any bonds having or claimed to be entitled to a priority of lien on Revenues over the lien securing the bond, including any and all future extensions, betterments and improvements to the System except as provided in this Section. The City may issue additional revenue bonds having a priority on or on a parity • with the lien on Revenues in favor of the bond to finance or pay the cost of constructing extensions, betterments and improvements to the System or to refund outstanding System Bonds if there shall have been procured and filed with the City Clerk and the Bondholder a statement by a certified public accountant not in the regular employ of the City ("Accountant") reciting the opinion that (i) the Net Revenues (Net Revenues being gross Revenues less operation and maintenance expenses, but not including depreciation) for the fiscal year preceding the year in which such additional bonds are to be issued were not less than 110% of the maximum annual debt service requirements (including principal, interest and financing and administrative fees) on all outstanding System Bonds and the bonds then proposed to be issued or (ii) the Net Revenues for the fiscal year succeeding the year in which such additional bonds are to be issued are projected to be sufficient in amount, taking in consideration any enacted increase in Revenues, to be not less than 110% of the maximum annual debt service requirements (including principal, interest and financing and administrative fees) on all outstanding System Bonds and the bonds then proposed to be issued. The additional bonds, the issuance of which is restricted and conditioned by this Section, shall not be deemed to mean bonds the security and source of payment of which are subordinate and subject to the priority of the bond and such additional bonds may be issued without complying with the terms and conditions of this Section. 8 Section 14. It is covenanted and agreed by the City with the Bondholder, the ® Authority and the Commission that it will faithfully and punctually perform all duties with reference to the System required by the Constitution and laws of the State and by this Ordinance, including, without limitation, the making and collecting of reasonable and sufficient rates lawfully established for services rendered by the System, segregating Revenues and applying them to the respective funds maintained pursuant to the Senior Ordinances and this Ordinance. The City covenants and agrees that the Bondholder shall have the protection of all the provisions of the Authorizing Legislation, and that the City will diligently proceed to enforce those provisions to the end of the Bondholder realizing fully upon its security. And, if the City shall fail to proceed within 30 days after written request shall have been filed by the Bondholder, the Bondholder may proceed to enforce all such provisions. If there be any default in the payment of the principal of or interest on the bond, or if the City defaults in any ADFA Bond Fund requirement or in the performance of any of the other covenants contained in this Ordinance, the Bondholder may, by proper suit, compel the performance of the duties of the officials of the City under the laws of the State. In the case of a default in the payment of the principal of and interest on the bond, the Bondholder may apply in a proper action to a court of competent jurisdiction for the appointment of a receiver to administer the System on behalf of the City and the Bondholder with power to charge and collect (or by mandatory injunction or otherwise to cause to be charged and collected) rates sufficient to provide for the payment of the expenses of operation, repair and maintenance and to pay the bond and interest outstanding and to apply Revenues in conformity with this Ordinance. When • all defaults in principal and interest payments have been cured, the custody and operation of the System shall revert to the City. No remedy herein conferred upon or reserved to the Bondholder is intended to be exclusive of any other remedy or remedies herein provided or provided by law, and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or given by law. No delay or omission of the Bondholder to exercise any right or power accrued upon any default shall impair any such right or power or shall be construed to be a waiver of any default or an acquiescence therein; and every power and remedy given by this Ordinance to the Bondholder may be exercised from time to time and as often as may be deemed expedient. No waiver of any default shall extend to or affect any other existing or any subsequent default or defaults or impair any rights or remedies consequent thereon. Any costs of enforcement of the bond or of any provision of this Ordinance, including reasonable attorney's fees, shall be paid by the City. The Authority may enforce all rights and exercise all remedies available to the Bondholder in the event the Financing Fee is not paid when due. Section 15. When the bond has been executed by the Mayor and City Clerk and the seal of the City impressed thereon as herein provided, it shall be delivered to the Bondholder upon payment of all or a portion of the purchase price in accordance with the Agreement. The sale proceeds shall be deposited, as and when received, in a special account of the City hereby created in a bank that is a member of the Federal Deposit Insurance Corporation and designated the "2010 Revenue Bond Sewer Construction Fund" (the "Construction Fund"). OThe moneys in the Construction Fund shall be used for reimbursing the City for the costs paid in 9 accomplishing the Improvements, expenses incidental thereto and the expenses of issuing the ® bond approved in accordance with the Agreement. Payments from the Construction Fund shall be by check or voucher signed by two persons designated by the City Council, and drawn on the depository. Each such check or voucher shall briefly specify the purpose of the expenditure. Section 16. The terms of this Ordinance shall constitute a contract among the City, the Bondholder and the Commission and no variation or change in the undertaking herein set forth shall be made while the bond is outstanding unless consented to in writing by the Bondholder and the Commission. Section 17. The City agrees that it will keep proper records, books and accounts relating to the operation of the System, which shall be kept separate from all other records and accounts of the City, in which complete and correct entries shall be made of all transactions relating to the operation of the System in accordance with generally accepted government accounting standards. Such books shall be available for inspection by the Bondholder and the Commission, or the agent or the representative of either, at reasonable times and under reasonable circumstances. The City agrees to have these records audited by an Accountant at least once each year. The City agrees that it shall also furnish to the Bondholder and the Commission (1) on or before 30 days after the close of each fiscal year, if requested, a statement of the operations of the System for the past fiscal year in form and content in the manner hereinafter specified, and (2) on or before 120 days after the close of each fiscal year, if requested, a copy of the audit report of the Accountant. The first report required by the last preceding sentence shall contain at least the following information: • (a) Statement of income and expense for the System; (b) Balance sheet for the System; (c) Schedule of insurance policies and fidelity bonds showing, with respect to each policy and bond, the amount and nature of risk covered, the expiration date, and the name of the insurer; and (d) Schedule of the number of customers and showing the rate schedule currently in effect. The reports referred to above shall cover the operations of the System for all of the last ensuing fiscal year. In the event the City fails or refuses to furnish or cause such reports to be furnished, the Bondholder may have the reports made, and the cost thereof shall be charged against the Operation and Maintenance Fund. Section 18. The City covenants and agrees that it will maintain the System in good condition and operate it in an efficient manner and at reasonable cost. The City agrees that, to the extent comparable protection is not otherwise provided to the satisfaction of the Bondholder and the Commission, it will insure, and at all times keep insured in a responsible insurance company or companies selected by the City and authorized and qualified under the • laws of the State to assume the risk thereof, all above-ground structures of the System against 10 loss or damage thereto in amounts and against such risks as are customarily insured against in connection with similar facilities and undertakings as the System. In the event of loss, the proceeds of such insurance shall be applied solely toward the reconstruction, replacement or repair of the System, and in such event the City will, with reasonable promptness, cause to be commenced and completed the reconstruction, replacement and repair work. Section 19. There shall be a statutory mortgage lien upon the water facilities which are part of the System (including all extensions, improvements and betterments now or hereafter existing) which shall exist in favor of the owner of the bond, and such water facilities shall remain subject to such statutory mortgage lien until payment in full of the principal of and interest on the bond, provided, however, that such statutory mortgage lien shall be interpreted according to the decision of the Supreme Court of the State in City of Harrison v. Braswell, supra. Section 20. The City is hereby authorized to accept the forgiveness of the principal of the bond under the terms of the Agreement. By accepting the forgiveness of the principal, the City is a sub-recipient of a one-time federal grant of funds to the Commission under ARRA. As a sub-recipient, the City is responsible for complying with the specific requirements of ARRA and the conditions of the one-time federal grant of ARRA funds to the Commission. If the City fails to satisfy any ARRA requirements or ARRA grant conditions, the City may be required to refund advances of the purchase price of the Bond. Specific ARRA requirements include but are not limited to: • ARRA Section 1512 Reporting Requirements; ARRA Section 1553 Whistleblower Protections; ARRA Section 1605 Buy American Requirements; ARRA Section 1606 Wage Rate Requirements; and ARRA Sections 902, 1514 and 1515 General Accountability Office and Inspector General Access and Review Requirements. Section 21. Other than as set forth in Section 20 hereof and in the Agreement, all rights of the Bondholder and the Commission under this Ordinance shall cease when all advances have been made against the purchase price of the bond under the Agreement and the principal amount has been forgiven in accordance with Section 20 hereof and the Agreement. Section 22. The provisions of this Ordinance are hereby declared to be separable, and if any provision shall for any reason be held illegal or invalid, it shall not affect the validity of the remainder of this Ordinance. Section 23. Reference in this Ordinance to 'Bondholder" shall include the original Bondholder or any registered assign thereof. 11 Section 24. All ordinances and resolutions and parts thereof in conflict herewith are hereby repealed to the extent of such conflict. PASSED: December 22, 2009. APPROVED: ATTEST: City Clerk (SEAL) 12 CERTIFICATE • The undersigned, City Clerk of the City of Batesville, Arkansas (the "City"), hereby certifies that the foregoing pages are a true and perfect copy of Ordinance No. , adopted at a regular session of the City Council of the City, held at the regular meeting place in the City at 5:30 o'clock p.m., on the 22nd day of December, 2009, and that the Ordinance is of record in Ordinance Record Book No. , Page , now in my possession. GIVEN under my hand and seal on this day of December, 2009. City Clerk (SEAL) • • 13 BOND PURCHASE AGREEMENT City of Batesville, Arkansas December 22, 2009 Attention: Mayor Ladies and Gentlemen: Certain terms used in this Bond Purchase Agreement are defined as follows: Issuer: City of Batesville, Arkansas Principal Amount: $6,300,000 Principal Forgiveness: $6,300,000 Interest Rate: 1.50% Financing Fee 1% per annum of the outstanding principal amount of the Bond (see Exhibit A) Bond: City of Batesville, Arkansas Water and Sewer System Revenue Bond, Series 2010 �r Bond Counsel: Friday, Eldredge & Clark, LLP Bond Ordinance: Ordinance No. of the Issuer, adopted December 22, 2009, under which the Bond is to be issued and secured. Rate Ordinances: The ordinances of the Issuer pursuant to which the rates are fixed for services of the System and System Revenues are collected. System Revenues: Revenues of the Issuer's Water and Sewer System. Administration Fee: $-0- Issuer's Notice City of Batesville, Arkansas Address: 500 E. Main Street Batesville, Arkansas 72501 Attn: Mayor Closing: 10:00 a.m., prevailing local time, on January 29, 2010, or at such other time or on such earlier or later date as is mutually agreed upon, at the offices of Bond Counsel in Little Rock,Arkansas. • Authorizing Title 14, Chapter 164, Subchapter 4, Title 14, Chapter 234, Subchapter 2, Legislation: and Title 14, Chapter 235, Subchapter 2 of the Arkansas Code of 1987 Annotated Disbursement October 15, 2012 Cut-Off Date: ARRA: The American Recovery and Reinvestment Act of 2009 The Arkansas Natural Resources Commission (the "Commission") and the Arkansas Development Finance Authority (the "Authority") hereby offer to enter into this Bond Purchase Agreement (the "Agreement") with you, the Issuer, for the purchase by the Authority from moneys in the Construction Assistance Revolving Loan Fund, created by Arkansas Code Annotated Section 15-5-901, as the same may be amended from time to time (the "Revolving Loan Fund"), and the sale by you of the Bond of the Issuer more particularly described below. Upon approval by you and by the execution of the acceptance hereof by the Mayor of the Issuer, this Agreement shall be in full force and effect in accordance with its terms and shall be valid, binding, and enforceable upon the Issuer,the Commission, and the Authority. Further terms of this Agreement are: 1. Upon the terms and conditions and upon the basis of the representations • herein set forth, the Authority,hereby agrees to purchase from the Issuer and the Issuer hereby agrees to sell to the Authority the entire Principal Amount of the Bond to be issued under and secured by the Bond Ordinance. 2. The Bond is being issued for the purpose of financing the planning, design, construction and/or rehabilitation of the wastewater treatment and/or wastewater collection facilities of the Issuer's water and sewer system (the "System"), described in the facilities plan furnished by the Issuer to and concurred with by the Commission (the "Project"), paying costs incidental thereto, and paying approved expenses incurred in connection with the issuance of the Bond as set forth in Exhibit B. 3. The Bond and the Financing Fee shall be secured by a pledge of and payable from the System Revenues, subject to a pledge in favor of certain outstanding bonds, if any, identified in the Bond Ordinance. Rates for usage of the System (the "Rates") have been levied and the System Revenues are collected pursuant to the Rate Ordinances. 4. The Bond shall be dated the date of the Closing. The Bond shall be authorized in an amount up to the Principal Amount identified above, and shall bear interest at the Interest Rate identified above. Principal and interest shall be amortized in accordance with the schedule set forth on Exhibit A attached hereto (which is based upon semiannual repayment of principal and interest commencing six months following the Disbursement Cut-Off Date and a 20 year amortization), and the Issuer shall pay to the Authority on the first business day of each month, commencing six months prior to the first principal payment date set forth on Exhibit A, • an amount equal to 1/6 of the next installment of interest and principal due on the Bond plus the 2 • Issuer shall pay to the Authority interest on the Bond on each April 15 and October 15 to and including the Disbursement Cut-Off Date. In addition to the payment of the principal and interest on the Bond,the Issuer shall be obligated to pay the Financing Fee to the Authority. The Financing Fee shall be payable in the same manner and on the same dates as interest on the Bond is due. The payment of the Financing Fee is expressly made subordinate to the payment of the principal of and interest on the Bond. The Issuer agrees that any delay in completion of the Project beyond the Disbursement Cut-Off Date shall not result in any extension of the date on which principal and interest payments are to be made on the Bond. The Bond shall be subject to redemption prior to maturity, shall be payable, and shall be as otherwise described in the Bond Ordinance. Interest on the Bond shall not be excludable from gross income for federal income tax purposes. 5. The Issuer recognizes that the Authority and the Commission shall be under no obligation to provide any funds to the Issuer other than the proceeds of the Bond and sales and use tax bonds to be issued by the Issuer in the maximum aggregate principal amount of $50,000,000. If, for any reason,the Issuer does not utilize the entire Bond proceeds, then in such event the Principal Amount of the Bond will be reduced to the amount actually withdrawn. Any reduction of the Bond pursuant to this provision shall result in pro rata reductions of the remaining installments of principal so that the weighted average life of the Bond immediately following any such reduction shall be substantially equal to the weighted average life of the Bond immediately prior to such reduction. The Authority agrees to accept, or cause the registered owner of the Bond to accept, a new Bond- from the Issuer reflecting the revised • payment schedule. . . 6. Subject to the terms and conditions and upon the basis of the representations herein set forth, the Authority hereby agrees to purchase the Bond from the Issuer in installments from time to time from moneys in the Revolving Loan Fund in an amount up to the Principal Amount, and the Issuer hereby agrees to sell the Bond to the Authority at a price of 100 percent of the Principal Amount of the Bond purchased from time to time. The purchase price for the Bond shall be paid in a series of advances in accordance with the provisions of paragraph 7. The initial advance of the purchase price shall take place at the Closing. At the Closing, the Issuer will deliver, or cause to be delivered, to the Authority a single typewritten bond, duly executed and authenticated, together with the other documents herein required, and the Authority will accept delivery and make the initial advance of the purchase price of the Bond by wire transfer of immediately available funds or by certified or official bank cashier's check as directed by the Issuer. The Authority shall have the option to terminate its obligation to purchase the Bond if the Closing does not occur by February 1,2010. 7. So long as the Issuer is in compliance with the terms and provisions of this Agreement and the Bond Ordinance,the representations and warranties of the Issuer made herein remain true and correct and the Project is under contract by February 17, 2010, the Authority agrees to make, and the Commission agrees to approve advances of the purchase price of the Bond ("Disbursements") from moneys in the Revolving Loan Fund as follows: • 3 (a) Disbursements shall only be made based upon actual work completed; (b) The Issuer may request reimbursement for costs not more often than monthly, provided, however, during the Project performance period requests for reimbursement shall be limited to quarterly; (c) Disbursements shall be for costs incurred prior to the Disbursement Cut- Off Date, and no Disbursements shall be made following the Disbursement Cut-Off Date; (d) Disbursements shall be made for eligible work called for in the engineering services contract and in the plans and specifications approved by the Commission and Bond issuance costs eligible under Title XVI of the Rules of the Commission, as now or hereafter amended ("Title XVI"); and (e) All requests for Disbursements must be made in accordance with Title XVI and shall be made by forwarding a completed copy of a Disbursement Request, in the form attached as Exhibit C hereto, to the Commission's Water Resources Development Division, along with the documentation for eligible Project Costs incurred since the last Disbursement Request and not previously submitted. 8. The Authority agrees not to make any transfer or attempt to transfer the Bond except to the Commission. 9. The Issuer represents and warrants to, and agrees with, the Authority and the Commission that: (a) The Issuer is a city of the first class, duly organized and existing under the laws of the State of Arkansas, and has, and at the date of Closing will have, full legal right, power, and authority (i) to enter into this Agreement, (ii) to adopt the Bond Ordinance and the Rate Ordinances, (iii) to issue, sell, and deliver the Bond to the Authority as provided herein, (iv) to levy the Rates and pledge the System Revenues, and (v) to carry out and consummate the transactions contemplated by this Agreement, the Bond Ordinance, and the Rate Ordinances; (b) The Issuer has complied, and will at the date of Closing be in compliance, in all respects,with the Authorizing Legislation; (c) By adoption of the Bond Ordinance pursuant to the Authorizing Legislation, the Issuer has duly authorized and approved the execution and delivery of, and the performance by the Issuer of the obligations contained in, the Bond and this Agreement and, when delivered to and paid for by the Authority at the Closing in accordance with the provisions of this Agreement, the Bond will have been duly authorized, executed, issued, and delivered and will constitute a valid and binding obligation of the Issuer in accordance with its terms, in conformity with the Authorizing Legislation, entitled to the benefit and security of the Bond Ordinance; 4 • (d) The financial statements of the System delivered to the Commission and the Authority are true and correct in all respects, have been prepared in accordance with generally accepted government accounting principles for municipalities, consistently applied, and fairly present the financial condition of the System as of their respective dates; (e) The execution and delivery of this Agreement and the Bond, the adoption of the Bond Ordinance and the Rate Ordinances, the levy of the Rates, the pledge of the System Revenues to the Bond, and the carrying out and consummation of the transactions contemplated by this Agreement and the Bond Ordinance will not conflict with or constitute a breach of or default under any applicable law or administrative regulation of the State of Arkansas or the United States or any judgment or decree or any agreement or other instrument to which the Issuer is a party or is otherwise subject; (f) There is no action, suit, proceeding, or investigation involving the Issuer before or by any court, public board, or body pending or, to the knowledge of the Issuer, threatened wherein an unfavorable decision, ruling, or finding would: (i) affect the creation, organization, existence, or powers of the Issuer or the titles of its officials to their offices, (ii) enjoin or restrain the issuance, sale, and delivery of the Bond, the levy of the Rates, or collection of the System Revenues or the pledge thereof, (iii) in any way question or affect any of the rights, powers, duties, or obligations of the Issuer with respect to the System Revenues, (iv) in any way question or affect any authority for the issuance of the Bond or the validity or enforceability of the Bond or the Bond Ordinance and the Rate Ordinances, or (v) in any way • question or affect this Agreement or the transactions contemplated.by this Agreement, or any other agreement or instrument relating thereto to which the Issuer is a party; (g) The Rates have been duly levied under the Authorizing Legislation and the Rate Ordinances, and the System Revenues have been duly pledged to the payment of the Bond under the Bond Ordinance pursuant to the authority granted by the Authorizing Legislation; and (h) The Issuer will promptly remit each Disbursement to the person or persons to whom payment is then due and owing. 10. The Issuer covenants and agrees with the Commission and the Authority: (a) To comply with all applicable Arkansas and federal statutes and regulations,including particularly, without limitation,Title XVI. (b) To utilize and expend the proceeds of the Bond in a timely and expeditious manner by: (1) utilizing Bond proceeds for eligible Project Costs and approved issuance costs, (2) proceeding expeditiously with and completing the Project, and (3) completing all facilities recommended in the approved facilities plan; (c) To establish and maintain adequate financial records for the Project in accordance with "generally accepted governmental accounting standards" defined as, but not • limited to, those contained in the U.S. General Accounting Office (GAO)publication "Standards 5 • for Audit of Governmental Organizations, Programs, Activities and Functions" (February 27, 1981), and make these records available to the Commission, the EPA Inspector General, or their authorized representatives; (d) To undertake the Project on its own responsibility and release and hold harmless the Commission and the Authority, and their officers, members, directors and employees, from any claim arising in connection with the design, construction, or operation of the Project or any other aspect of the wastewater facilities of the Issuer, including any matter due solely to their own negligence; (e) To comply with all terms and conditions of any construction contracts, architectural or engineering agreements, and other agreements affecting the Project, the premises of the wastewater facilities of the Issuer, and its operations and to require its construction contractor to furnish both a performance bond and payment bond in the full amount of the construction contract for the Project; (f) To become familiar with and comply with all federal and state laws pertaining to equal employment opportunities ensuring that all engineers and contractors for the Project do not discriminate against any person on the basis of race, color, religion, sex, age, national origin,or handicap; (g) To provide complete (unaudited) financial statements and budget •. - information for the System to the Commission, within 30 days of a written request from the Commission, for any year(s)during which this Agreement is in effect; and (h) To maintain and operate the System in a sound and economical manner and in accordance with standards as may be required or prescribed by federal, state, or local regulatory agencies. 11. The Commission has received an award of an ARRA capitalization grant (the "Grant") from the Environmental Protection Agency ("EPA"), and the Bond will be funded with proceeds of the Grant. The Commission and the Authority hereby agree to forgive the principal of the Bond to the extent of each Disbursement made under Section 7 hereof. Such forgiveness of principal shall occur simultaneously with each Disbursement without affirmative action by the Commission or the Authority. The Commission and the Authority agree to provide, at the request of the Issuer, any additional evidence to the Issuer's accountants that principal of the Bond has been forgiven hereunder and, after all Disbursements are made, to return the Bond to the Issuer for cancellation. Notwithstanding any other provision of this Agreement, the Commission and the Authority further agree that since no principal will be outstanding under the Bond, no Financing Fee will be due. By accepting the forgiveness of the principal of the Bond, the Issuer is a sub-recipient of the Grant. As a sub-recipient, the Issuer shall be responsible for complying with the specific requirements of ARRA and the conditions of the Grant. If the Issuer fails to satisfy any ARRA requirements or Grant conditions, the Issuer may be required to refund the Disbursements. The Grant requirements are set forth on Exhibit D attached hereto. The Issuer agrees to meet the requirements of the Grant unless waived by the • Commission and EPA. 6 • 12. The Authority and the Commission have entered into this Agreement in reliance upon the representations and agreements of the Issuer herein and the performance by the Issuer of its obligations hereunder, both as of the date hereof and as of the date of the Closing. The obligation of the Authority and the Commission under this Agreement are and shall be subject to the following further conditions: (a) At the Closing, the Bond Ordinance and the Rate Ordinances shall be in full force and effect and shall not have been amended, modified, or supplemented after the date hereof except as may have been agreed to by the Authority and the Commission, and the Issuer shall have duly adopted and there shall be in full force and effect such other ordinances and resolutions as, in the opinion of Bond Counsel and the Commission, shall be necessary in connection with the transactions contemplated hereby. (b) The representations and warranties of the Issuer contained herein shall be true,complete, and correct on the date hereof and on and as of the date of the Closing, as if made on and as of the date of the Closing. (c) At or prior to the Closing, the Commission and the Authority shall have received the following: (1) The Bond Ordinance certified by the Issuer under its seal as having been duly adopted and as being in-full force and effect, with only such amendments as may have been • agreed to by the Commission and the Authority; (2) An unqualified approving opinion, dated the date of the Closing, of Bond Counsel, in form and substance satisfactory to the Commission and the Authority, to the effect that: (i) the Issuer is duly created and validly existing as a city of the first class of the State of Arkansas, with the power to adopt the Bond Ordinance, perform the agreements on its part contained in the Bond Ordinance, and issue the Bond; (ii) the Bond has been duly authorized and issued by the Issuer and is a valid and binding special obligation of the Issuer enforceable in accordance with its terms; (iii) the Bond is secured by an irrevocable pledge of and lien on the System Revenues as provided in the Bond Ordinance, which pledge is valid and enforceable; and (iv) the interest on the Bond is exempt from all Arkansas state, county, and municipal taxes; (3) A supplemental opinion, dated the date of Closing, of Bond Counsel, in form and substance satisfactory to the Commission and the Authority, to the effect that (i) the Bond and the Bond Ordinance conform in both form and tenor to the provisions relating thereto summarized in the Term Sheet attached to the Memorandum of Agreement for the Project and • (ii) if the Bond were being purchased on a tax-exempt basis, the Bond would not constitute a 7 • "private activity bond" within the meaning of Section 141 of the Internal Revenue Code of 1986, as amended, and covering such other matters as may be reasonably requested by the Authority and the Commission; (4) A certificate dated the date of the Closing and signed by the Mayor and the City Clerk of the Issuer and the manager of the System to the effect that: (i) the representations and warranties of the Issuer contained herein are true and correct in all material respects on and as of the date of the Closing as if made on the date of the Closing, (ii) the Issuer has complied with all agreements and covenants and satisfied all conditions on its part to be complied with or satisfied at or prior to the Closing, and (iii)there has been no material adverse change in the business, property, or financial condition of the System and the System has not incurred any material liabilities other than in the normal course of business which have not been disclosed in writing to the Commission and the Authority since the date of the latest financial statements submitted to the Commission and the Authority; (5) Two counterpart originals of a transcript of all proceedings relating to the authorization and issuance of the Bond; and (6) Such additional legal opinions, certificates, proceedings, instruments, and other documents as the Commission,the Authority, and Bond Counsel may reasonably request to evidence compliance by the Issuer with legal requirements, the truth and accuracy, as of the time of Closing, of the representations of the Issuer herein contained, and the due performance or • satisfaction by the Issuer at or prior to such time of all agreements then to be performed and.all conditions then to be satisfied by the Issuer. All of the opinions, letters, certificates, instruments, and other documents mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof if, but only if, they are in form and substance satisfactory to the Commission and the Authority. The performance of any and all obligations of the Issuer under this Agreement and the performance of any and all conditions contained herein for the benefit of the Authority and the Commission may be waived by the Authority and the Commission in their sole discretion. 13. All notices, demands, and formal actions hereunder will be in writing mailed, telegraphed, or delivered to the parties at the following addresses: The Issuer: Issuer's Notice Address The Commission: Arkansas Natural Resources Commission 101 East Capitol, Suite 350 Little Rock, Arkansas 72201 Attention: Pris Houchens • 8 • The Authority: Arkansas Development Finance Authority Technology Center 423 Main Street, Suite 500 Little Rock, Arkansas 72201 Attention: Vice President for Finance and Administration 14. All representations and warranties of the Issuer contained herein shall remain operative and in full force and shall survive (a) the execution and delivery of this Agreement, (b) any investigation made by or on behalf of the Commission or the Authority, (c) the purchase of the Bond hereunder, and (d) any disposition of or payment for the Bond. 15. Any audit or review of plans and specifications and any inspection of the work shall be for the Commission's convenience only in order to determine that they are within the approved scope of the Project. No such review and inspection, approvals, and disapprovals shall be an undertaking by the Commission of responsibility for design or construction. 16. Neither the Commission nor the Authority is a partner,joint venturer, or in any other way a party to the Project or the operation of the wastewater facilities of the Issuer. Neither.the Commission nor the Authority shall in any way be liable or responsible by reason of the provisions hereof to the Issuer or any third party for the payment of any claims in connection therewith. • 17. The Authority agrees that it will invest the monthly payments made by the Issuer until applied to the semiannual interest and principal payments due on the Bond, and semiannually to credit interest accruing on such monthly payments against the next six monthly principal and interest payments due from the Issuer and to notify the Issuer in writing of such credit. 18. This Agreement may be executed in any number of counterparts with each executed counterpart constituting an original but all of which together shall constitute one and the same instrument. 19. This Agreement will inure to the benefit of and be binding upon the parties hereto and their successors and will not confer any rights upon any other person. This Agreement shall be governed by and construed in accordance with the laws of the State of Arkansas. • 9 • ARKANSAS NATURAL RESOURCES COMMISSION BY Title: ARKANSAS DEVELOPMENT FINANCE AUTHORITY BY Title: Vice President for Finance and Administration ACCEPTED this 22nd day of December, 2009. CITY OF BATESVILLE, ARKANSAS BY Mayor • 10 EXHIBIT A Batesville, Arkansas ANRC Loan#: 00738-CWRLF-L ANRC Project#: WRD-003-620 Amortization Schedule - 20 Years - Semi-Annual Payments as of date: Dec 1, 2009 Disbursement First Repayment Annual Cut-off Payment Length Lending Total Semi-Annual Date Date Years Rate Principal Payment Oct 15, 2012 Apr 15, 2013 20 2.500% $ 6,300,000.00 $ 201,105.00 Semi-Annual Payment Outstanding Payment 1.000% 1.500% Principal Period Date Amount Servicing Fee Interest Principal Balance $ 6,300,000.00 1 Apr 15, 2013 $ 201,105.00 $ 31,500.00 $ 47,250.00 $ 122,355.00 6,177,645.00 2 Oct 15, 2013 201,105.00 30,888.00 46,332.00 123,885.00 6,053,760.00 3 Apr 15, 2014 201,105.00 30,269.00 45,403.00 125,433.00 5,928,327.00 4 Oct 15, 2014 201,105.00 29,642.00 44,462.00 127,001.00 5,801,326.00 5 Apr 15, 2015 201,105.00 29,007.00 43,510.00 128,588.00 5,672,738.00 6 Oct 15, 2015 201,105.00 28,364.00 42,546.00 130,195.00 5,542,543.00 7 Apr 15, 2016 201,105.00 27,713.00 41,569.00 131,823.00 5,410,720.00 8 Oct 15, 2016 201,105.00 27,054.00 40,580.00 133,471.00 5,277,249.00 9 Apr 15, 2017 201,105.00 26,386.00 39,579.00 135,140.00 5,142,109.00 10 Oct 15, 2017 201,105.00 25,711.00 38,566.00 136,828.00 5,005,281.00 11 Apr 15, 2018 201,105.00 25,026.00 37,540.00 138,539.00 4,866,742.00 12 Oct 15, 2018 201,105.00 24,334.00 36,501.00 140,270.00 4,726,472.00 13 Apr 15, 2019 201,105.00 23,632.00 35,449.00 142,024.00 4,584,448.00 JL 14 Oct 15,2019 201,105.00 22,922.00 34,383.00 143,800.00 4,440,648.00 15 -Apr 15, 2020 1201,105.00 ,105.00 22,203.00 33,305.00 145,597.00 4,295,051.00 16 Oct 15, 2020 ,105.00 21,475.00 32,213.00 147,417.00 4,147,634.00 17 Apr 15, 2021 20,738.00 31,107.00 149,260.00 3,998,374.00 18 Oct 15, 2021 ,105.00 19,992.00 29,988.00 151,125.00 3,847,249.00 19 A r 15, 2022 201,105.00 19,236.00 28,854.00 153,015.00 3,694,234.00 20 Oct 15, 2022 201,105.00 18,471.00 j24,177.00 ,707.0154,927.00 3,539,307.00 3,382,444.00 21 -Apr 15, 2023 201,105.00 17,697.00 ,54156,863.00 22 Oct15, 2023 201,105.00 16,912.00 ,36158,825.00 3,223,619.00 23 A r15, 2024 201,105.00 16,118.00 160,810.00 3,062,809.00 24 Oct15, 2024 201,105.00 15,314.007 162,820.00 2,899,989.00 25 Apr 15, 2025 201,105.00 14,500.00 21,750.00 164,855.00 2,735,134.00 26 Oct 15, 2025 201,105.00 13,676.00 20,514.00 166,915.00 2,568,219.00 27 Apr 15, 2026 201,105.00 12,841.00 19,262.00 169,002.00 2,399,217.00 28 Oct 15, 2026 201,105.00 11,996.00 17,994.00 171,115.00 2,228,102.00 29 Apr 15, 2027 201,105.00 11,141.00 16,711.00 173,253.00 2,054,849.00 30 Oct 15, 2027 201,105.00 10,274.00 15,411.00 175,420.00 1,879,429.00 31 A r 15, 2028 201,105.00 9,397.00 14,096.00 177,612.00 1,701,817.00 32 Oct 15, 2028 201,105.00 8,509.00 12,764.00 179,832.00 1,521,985.00 33 A r 15, 2029 201,105.00 7,610.00 11,415.00 182,080.00 1,339,905.00 34 Oct 15, 2029 201,105.00 6,700.00 10,049.00 184,356.00 1,155,549.00 35 Apr 15, 2030 201,105.00 5,778.00 8,667.00 186,660.00 968,889.00 36 Oct 15, 2030 201,105.00 4,844.00 7,267.00 188,994.00 779,895.00 37 Apr 15, 2031 201,105.00 3,899.00 5,849.00 191,357.00 588,538.00 38 Oct 15, 2031 201,105.00 2,943.00 4,414.00 193,748.00 394,790.00 39 A r 15, 2032 201,105.00 1,974.00 2,961.00 196,170.00 198,620.00 40 Oct 15, 2032 201,103.00 993.00 1,490.00 198,620.00 - TOTALS 7$ 87,04,4,19 8.00 $ 697,679.00 $ 1,046,519.00 $ 6,300,000.00 EXHIBIT B USES OF FUNDS Item Costs Local Loan Expenses $ 14,000 Planning and Design 963,334 Construction and Contingency 5,322,366 PRINCIPAL AMOUNT $6,300,000 • EXHIBIT C RLF-76 DISBURSEMENT REQUEST (R-09/02) Arkansas Natural Resources Commission Revolving Loan Fund Project Name: Request Number: Project Number: Loan No Percent Complete: Employer Identification No.: Cost Classification Costs Incurred RLF Eligible Previous RLF RLF Payment Due to Date Amount Disbursements this Request a. Land Acquisition b. Administration Costs(Land) C. Construction-Plant d. Construction-Line work e. Administration Costs(Const) f. A/E Basic Fees-Bid Phase g. A/E Basic Fees-Const. Phase h. Inspection Phase I. Start-up Services Project Performance Fees 0&M Manual I. Material Testing m. Project Performance Testing n. Equipment o. Allowance(Planning/Design) p. ADFA Fee q. Legal Fees F- Issuance Costs s. t. TOTAL I certify that to the best of my Requested Signature of Authorized Certifying Oficial Date Report Submitted knowledge,that this By Typed or Printed Name and Title Telephone Number disbursement request accurately reflects the total RLF Signature of Engineenng Consultant Date Signed amount due to date and that all Prepared costs requested are in By Typed or Printed Name and Title Telephone Number accordance with the terms of the bond purchase agreement Signature of RLF Official Date Signed and RLF regulations. I further Approved certify that all work has been By Typed or Printed Name and Title Telephone Number inspected and performed in .ordance with RLF program Signature of Project Engineer Date Signed uirements. Typed of Printed Name and Title Telephone Number Page 1 of 1 • EXHIBIT D GRANT REQUIREMENTS ARRA Requirements 1. ARRA REPORTING REQUIREMENTS. The Issuer shall comply with the reporting requirements of section 1512 of ARRA,including but not limited to the following: (a) This award requires the Issuer to complete the Project and to report on the use of Bond proceeds. Information from these reports will be made available to the public. (b) The initial report is due by January 3, 2010. Thereafter, the reports are due no later than three calendar days after each calendar quarter in which the Issuer receives Disbursements under the Agreement. (c) The Issuer must maintain a current registration in the Central Contractor Registration (http://www.ccr.gov) at all times until all Disbursements are made. A Dun and Bradstreet Universal Numbering System ("DUNS") Number (http://www.dnb.com) is one of the requirements for registration in the Central Contractor Registration. • (d) - The Issuer must document and report the number and types of jobs created by the Project. 2. INSPECTOR GENERAL REVIEWS: In addition to the access to records provisions of 2 CFR 215.53 or 40 CFR 31.42, and in accordance with the provisions of section 1515 of ARRA, the Issuer agrees to allow any appropriate representative of the Office of Inspector General to (1) examine any records of the Issuer, any of its procurement contractors and subcontractors, or any State or local agency administering such contract, that pertain to,and involve transactions relating to,the procurement contract,subcontract, grant or subgrant; and (2) interview any officer or employee of the Issuer, subcontractor, or agency regarding such transactions. The Issuer understands that providing false, fictitious, or misleading information with respect to the receipt and disbursement of EPA grant funds may result in criminal, civil, or administrative fines and/or penalties. The Issuer further understands that the findings of any review, along with any audits, conducted by an inspector general of a Federal department or executive agency and concerning funds awarded under ARRA shall be posted on the Inspector General's website and linked to www.recovery.gov, except that information that is protected from disclosure under sections 552 and 552a of title 5, United States Code may be redacted from the posted version. • • 3. PROTECTION OF WHISTLEBLOWERS: In accordance with section 1553 of ARRA, the Issuer agrees that employees of non-Federal employer receiving covered funds may not be discharged, demoted, or otherwise discriminated against as a reprisal for disclosing, including a disclosure made in the ordinary course of an employee's duties, to the Recovery Accountability and Transparency Board, an Inspector General, the. Comptroller General, a member of Congress, a State or Federal regulatory or law enforcement agency, a person with supervisory authority over the employee, a court or grand jury, the head of a Federal agency, or their representatives, information that the employee reasonably believes is evidence of (1) gross mismanagement of an agency contract or grant relating to grant funds; (2) a gross waste of covered funds; (3) a substantial and specific danger to public health or safety related to implementation or use of grant funds; (4) an abuse of authority related to implementation or use of covered funds; or (5) a violation of law, rule, or regulation related to a grant awarded or issued relating to covered funds. 4. OMB GUIDANCE: The Bond is subject to all applicable provisions of implementing guidance for ARRA issued by the United States Office of Management and Budget, including the Initial Implementing Guidance for the American Recovery and Reinvestment Act (M-09-10) issued on February 18, 2009 and available on www.recovery.gov, and any subsequent guidance documents issued by OMB. 5. CIVIL RIGHTS COMPLIANCE. The Issuer will comply with Title VI of the Civil • Rights Act of 1964, Section 504 of the Rehabilitation Act of 1973, Title IX of the Education Amendments of 1972, the Age Discrimination Act of 1975, and a variety of program-specific statutes with nondiscrimination requirements. Other civil rights laws may impose additional requirements on the Issuer. These laws include,but are not limited to, Title VII of the Civil Rights Act of 1964 (prohibiting race, color, national origin, religion, and sex discrimination in employment), the Americans with Disabilities Act(prohibiting disability discrimination in employment and in services provided by State and local governments, businesses, and non-profit agencies), and the Fair Housing Act (prohibiting race, color, national origin, age, family status, and disability discrimination in housing), as well as any other applicable civil rights laws. For questions about these civil rights obligations, please call the EPA's Office of Civil Rights at 202-564-7272 or contact us via e-mail: http://www.epa.gov/civilrights/ comments.htm. 6. LIMIT ON FUNDS: The Issuer shall not use proceeds of the Bond for particular activities for any casino or other gambling establishment, aquarium, zoo, golf course, or swimming pool. 7. ARRA PROJECT SIGNAGE. The Issuer must display ARRA Logo in a manner that informs the public that the Project is an ARRA investment. If the EPA logo is displayed along with ARRA logo and logos of other participating entities, the EPA logo must not • be displayed in a manner that implies that EPA itself is conducting the Project. Instead, • the EPA logo must be accompanied with a statement indicating that the Issuer received financial assistance from EPA for the Project. The Commission logo shall be displayed in a manner that informs the public that the Commission is the State Agency awarding ARRA funds. The Commission logo must not be displayed in a manner that implies that the Commission itself is conducting the Project. 8. ARRA BUY AMERICAN REQUIREMENTS. Section 1605 of ARRA requires the'use of American iron, steel, and manufactured goods. (a) Definitions. As used herein: (1) "Manufactured good" means a good brought to the construction site for incorporation into the building or work that has been— (i) Processed into a specific form and shape; or (ii) Combined with other raw material to create a material that has different properties than the properties of the individual raw materials. (2) "Public building" and "public work" means a public building of, and a public work of, a governmental entity (the United States; the District of • Columbia;' commonwealths, territories, and minor outlying islands of the United States; State and local governments; and multi-State, regional, or interstate entities which have governmental functions). These buildings and works may include, without limitation, bridges, dams, plants, highways, parkways, streets, subways, tunnels, sewers, mains, power lines, pumping stations, heavy generators, railways, airports, terminals, docks, piers, wharves, ways, lighthouses, buoys, jetties, breakwaters, levees, and canals, and the construction, alteration, maintenance, or repair of such buildings and works. (3) "Steel' means an alloy that includes at least 50 percent iron, between .02 and 2 percent carbon, and may include other elements. (b) Domestic preference. (1) All iron, steel, and manufactured goods used in the project are produced in the United States except as provided in subparagraphs(3)and (4)below. (2) This requirement does not apply to the material listed by the Federal Government. All 'Buy American Waivers" are published in the Federal Register and published at http://www.epa.gov/recovery/. • • (3) The award official may add other iron, steel, and/or manufactured goods to the list in subparagraph (b)(2) of this paragraph 8 if the Federal government determines that— (i) The cost of the domestic iron, steel, and/or manufactured goods would be unreasonable. The cost of domestic iron, steel, or manufactured goods used in the Project is unreasonable when the cumulative cost of such material will increase the cost of the overall Project by more than 25 percent; (ii) The iron, steel, and/or manufactured good is not produced, or manufactured in the United States in sufficient and reasonably available quantities and of a satisfactory quality; or (iii) The application of the restriction of section 1605 of ARRA would be inconsistent with the public interest. (c) Request for determination of inapplicability of Section 1605 of ARRA. (1) Requests to use foreign iron, steel, or manufactured goods (i) Any request to use foreign iron, steel, and/or manufactured goods © in accordance with subparagraph (b)(3) of this paragraph 8 shall include adequate information for EPA evaluation of the request, including— (A) A description of the foreign and domestic iron, steel, and/or manufactured goods; (B) Unit of measure; (C) Quantity; (D) Cost; (E) Time of delivery or availability; (F) Location of the project; (G) Name and address of the proposed supplier; and (H) A detailed justification of the reason for use of foreign iron, steel, and/or manufactured goods cited in accordance with subparagraph (b)(3) of this paragraph 8. (ii) A request based on unreasonable cost shall include a reasonable survey of the market and a completed cost comparison table in the format in subparagraph(d) below. (iii) The cost of iron, steel, and/or manufactured goods material shall include all delivery costs to the construction site and any applicable duty. • • (iv) The Issuer request for a determination submitted after ARRA funds have been obligated for a project for construction, alteration, maintenance, or repair shall explain why the Issuer could not reasonably foresee the need for such determination and could not have requested the determination before the funds were obligated. If the Issuer does not submit a satisfactory explanation, the award official need not make a determination. (2) To apply for a Project waiver, the Issuer must email the request in the form of a Word document (.doe) to the EPA Region 6 waiver email address at region6waiver@epa.gov and copy the email to the Commission's Project Administrator at pris.houchens@arkansas.gov. If a waiver is necessary, EPA strongly recommends initiating the request before construction has initiated. (3) If the EPA determines after funds have been obligated for a project for construction, alteration, maintenance, or repair that an exception to section 1605 of ARRA applies, the award official will amend the award to allow use of the foreign iron, steel, and/or relevant manufactured goods. When the basis for the exception is nonavailability or public interest, the amended award shall reflect adjustment of the award amount, redistribution of budgeted funds, and/or other actions taken to cover costs associated with acquiring or using the foreign iron, steel, and/or relevant manufactured goods. When the basis for the exception is the unreasonable cost of the domestic iron, steel, or manufactured goods, the award official shall adjust the award amount or redistribute budgeted funds by at least the differential established in 2 CFR 176.110(a). (4) Unless the EPA determines that an exception to section 1605 of ARRA applies, use of foreign iron, steel, and/or manufactured goods is noncompliant with section 1605 of ARRA. (d) Data. To permit evaluation of requests under subparagraph (b) of this paragraph 8 based on unreasonable cost, the Issuer shall include the following information and any applicable supporting data based on the survey of suppliers: (W I • FOREIGN AND DOMESTIC ITEMS COST COMPARISON Unit Cost Description of Measure Quantity (Dollars)* Item 1: Foreign steel, iron, or manufactured good Domestic steel, iron, or manufactured good Item 2: Foreign steel, iron, or manufactured good Domestic steel, iron, or manufactured good [List name, address, telephone number, email address, and contact for suppliers surveyed. Attach copy of response; if oral, attach summary.] [Include other applicable supporting information.] [* Include all delivery costs to the construction site.] ARRA Davis-Bacon Requirements 1. The Issuer shall comply with the Davis-Bacon wage rate requirements of section 1606 of ARRA for the portion of the Project financed with the Bond. 2. The Issuer shall ensure that the standard Davis-Bacon contract clauses found in 29 CFR 5.5(a) are incorporated in any contracts for the portion of the Project financed with the Bond that are in excess of$2,000 for construction, alteration or repair (including painting and decorating). 3. The Issuer shall require contractors and subcontractors on the portion of the Project financed with the Bond to pay all laborers and mechanics working on such portion of the Project financed with the Bond the higher wage rate of the following: (a) wage rates not less than those prevailing on projects of a character similar in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40,United States Code, or (b) Arkansas's wage rates established from time to time. Failure to Meet ARRA Requirements If the Issuer fails to satisfy any ARRA requirements, the Issuer may be required to refund any ARRA funds disbursed to the Issuer by ANRC.