HomeMy WebLinkAboutOrd. 1021 Water Enterprise Revenue Bonds, Series 2022 Source of Payment, Providing details, & Water System 11-09-2022ORDINANCE NO. 1021
AN ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF TOWN OF
FIRESTONE, COLORADO, WATER ENTERPRISE REVENUE BONDS,
SERIES 2022; PROVIDING FOR THE SOURCE OF PAYMENT OF SUCH
BONDS, AND PROVIDING OTHER DETAILS CONCERNING THE BONDS
AND THE TOWN'S WATER SYSTEM.
WHEREAS, the Town of Firestone, Colorado (the "Town"), is a municipal
corporation duly organized and existing under the Constitution and laws of the State of Colorado
(the "State"); and
WHEREAS, the members of the Board of Trustees of the Town (the "Board") have
been duly elected or appointed and qualified; and
"System"); and VII VEREAS, the Town now owns and operates a municipal water system (the
WHEREAS, by Ordinance No. 297 of the Town adopted on October 14, 1993, the
Board established the Town of Firestone Water Activity Enterprise as a "water activity enterprise"
pursuant to Title 37, Article 45.1, C.R.S. (the "Water Enterprise Act"), for the purpose of operating
and accounting for the operations of the System; and
WHEREAS, the Board has determined, and hereby determines that the System
constitutes an enterprise pursuant to Article X, Section 20 of the Colorado Constitution
("TABOR") and the Water Enterprise Act; and
WHEREAS, the Board has determined, and hereby determines, that is necessary
and in the best interest of the Town and its inhabitants that the Town finance the costs of acquiring,
constructing and installing Capital Improvements to the System, including acquiring water rights
to provide water for the System (the "Project"); and
WHEREAS, the Town is authorized by TABOR, Title 31, Article 35, Part 4,
C.R.S., and the Water Enterprise Act to issue revenue bonds authorized by action of the Board
without the approval of the electors of the Town since the System constitutes and enterprise within
the meaning of TABOR; and
WHEREAS, the Town intends to issue its "Town of Firestone, Colorado, Water
Enterprise Revenue Bonds, Series 2022" (the "Bonds") to defray the Cost of the Project
(hereinafter defined); and
WHEREAS, the Town has heretofore issued, pursuant to Ordinance No. 973 of the
Town adopted by the Board on May 27, 2020 (the "2020 Bond Ordinance"), its Town of Firestone,
Colorado, Water Enterprise Revenue Bonds, Series 2020, originally issued and currently
outstanding in the aggregate principal amount of $45,955,000 (the "2020 Bonds"); and
WHEREAS, the Town is not delinquent in the payment of any principal or interest
on the 2020 Bonds; and
WHEREAS, except to secure the 2020 Bonds, the Town has not pledged nor in any
way hypothecated the revenues derived and to be derived directly or indirectly from the operation
of the System to the payment of any securities or for any other purpose with the result that the Net
Revenues may now be pledged lawfully and irrevocably for the payment of the Bonds on a parity
with the 2020 Bonds, and the Bonds may be made payable from the Net Revenues; and
WHEREAS, the Board has further determined and hereby further declares that the
Town is authorized by, and the Bonds shall be issued pursuant to the provisions of the Water
Enterprise Act; Title 31, Article 35, Part 4, C.R.S.; and Title 11, Article 57, Part 2, C.R.S.; and
WHEREAS, the Town intends to privately place the Bonds with an Initial
Purchaser, which Initial Purchaser shall identified in the Sale Certificate, and which Initial
Purchaser shall be (a) an "accredited investor," as defined in Rule 501(A)(1), (2), (3) or (7) of
Regulation D promulgated under the Securities Act of 1933, as amended (an "Institutional
Accredited investor") or (b) a "qualified institutional buyer," as defined in Rule 144A promulgated
under the Securities Act of 1933, as amended (a "Qualified Institutional Buyer") as hereafter
named by the Town; and
WHEREAS, pursuant to Section 11-57-205, C.R.S., as amended, the Town desires
to delegate to any of the Mayor, the Town Manager or the Finance Director the power to accept
the proposal to purchase the Bonds and to determine the rate of interest on the Bonds, the
redemption provisions of the Bonds, the price at which the Bonds will be sold, the aggregate
principal amount of the Bonds to be issued and the amount of principal maturing, or subject to
mandatory redemption, in any particular year; and
WHEREAS, the Board has determined and does hereby declare:
A. In order to meet the present and future needs of the Town, it is necessary to
extend, better, otherwise improve and equip the System;
B. Net Revenues shall be pledged to the payment of the Bonds on a parity with
the 2020 Bonds;
C. Because of market conditions, the Bonds shall be to the Initial Purchaser as
a private placement in accordance with its proposal, and such sale is to the best advantage of the
Town; and
D. All action preliminary to the authorization of the issuance of the Bonds has
been taken.
WHEREAS, there is on file with the Town Clerk the form of the Paying Agent; and
WHEREAS, it is necessary to provide for the form of the Bonds, Bond details, the
payment of the Bonds, and other provisions relating to the authorization, issuance, and sale of the
Bonds.
NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF TRUSTEES OF
THE TOWN OF FIRESTONE, COLORADO:
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ARTICLE I
DEFINITIONS, INTERPRETATION,
RATIFICATION AND EFFECTIVE DATE
Section 101. Short Title. This Ordinance shall be known as and may be cited
by the short title "Series 2022 Bond Ordinance" (the "Ordinance").
Section 102. Definitions. The terms in this Section for all purposes of this
Ordinance and of any ordinance amendatory hereof or supplemental hereto, or relating hereto, and
of any other ordinance or any other document pertaining hereto, except where the context by clear
implication otherwise requires, shall have the meanings herein specified:
"acquire" or "acquisition" means the opening, laying out, establishment,
purchase, construction, securing, installation, reconstruction, lease, gift, grant from the Federal
Government, the State, any body corporate and politic therein, or any other Person, the
endowment, bequest, devise, transfer, assignment, option to purchase, other contract, or other
acquisition, or any combination thereof, of any properties pertaining to the System, or an interest
therein, or any other properties herein designated.
"_Acquisition Fund" means the special fund designated as the "Town of
Firestone, Colorado, Water Enterprise Revenue Bonds, Series 2022, Acquisition Fund," created
pursuant to Section 501 hereof.
"Board" means the Board of Trustees of the Town, and any successor
governing body of the municipal corporation owning the System.
"Bond Counsel" means an attorney or a firm of attorneys, designated by the
Town of nationally recognized standing in matters pertaining to the tax status of interest on bonds
issued by states and their political subdivisions, duly admitted to the practice of law before the
highest court of any state of the United States of America or the District of Columbia.
"Bond Fund" means the special fund designated as the "Town of Firestone,
Colorado, Water Enterprise Revenue Bonds, Series 2022, Bond Fund" created pursuant to Section
605 hereof.
"Bond Requirements" means the principal of, any prior redemption premiums
due in connection with, and the interest on the Bonds, any Parity Bonds or other securities payable
from the Net Revenues and heretofore or hereafter issued, if any, or such part of such securities as
may be designated.
"Bonds" means the "Town of Firestone, Colorado, Water Enterprise Revenue
Bonds, Series 2022" issued pursuant to this Ordinance.
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"Business Dad" means a day of the year, other than a Saturday or Sunday,
other than a day on which Commercial Banks located in the city in which the principal corporate
trust office of the Paying Agent is located are required or authorized to remain closed and other
than a day on which the New York Stock Exchange is closed.
"Capital Improvements" means the acquisition of land, water or water rights,
easements, facilities, and equipment (other than ordinary repairs and replacements), and the
construction or reconstruction of improvements, betterments, and extensions, for use by or in
connection with the System.
"Closing Date" means the date of delivery of and payment for the Bonds.
"Code" means the Internal Revenue Code of 1986, as amended to the date of
delivery of the Bonds, and the regulations promulgated thereunder.
"Combined Maximum Annual Principal and Interest Requirements" means the
largest sum of the principal of and interest on the Bonds and any Outstanding Parity Bonds,
excluding any securities the principal of which is payable within less than one year from the date
on which issued, to be paid during any one Fiscal Year for the period beginning with the Fiscal
Year in which such computation is made and ending with the Fiscal Year in which any Bond or
other such security last becomes due at maturity or on a Redemption Date, whichever time is later
(but excluding any reserve requirement to secure such payments unless otherwise expressly
provided). The word "principal," as used in the preceding sentence, means for all purposes of this
paragraph, the principal which must be paid to security Owners, whether on stated maturity dates
or on mandatory Redemption Dates, or otherwise. Any such computation shall be adjusted for all
purposes in the same manner as is provided in Section 803 hereof.
"Commercial Bank" means a state or national bank or trust company which is
a member of the Federal Deposit Insurance Corporation (or any successors thereto) and of the
Federal Reserve System, which has a capital and surplus of $10,000,000 or more, and which is
located within the United States of America.
"Cost of the Project" means all costs of the Project or any interest therein, as
designated by the Town, which cost, at the option of the Town (except as may be otherwise limited
by law) may include all, any one or other portion of the incidental costs pertaining to the Project,
including, without limitation:
(a) All preliminary expenses or other costs advanced by the Town or
advanced by the Federal Government, the State, or by any other Person from any source, with the
approval of the Board, or any combination thereof, or otherwise;
(b) The costs of making surveys and tests, audits, preliminary plans,
other plans, specifications, estimates of costs, and other preliminaries;
(c) The costs of contingencies;
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(d) The costs of premiums on any builders' risk insurance and
performance bonds during the construction, installation, and other acquisition of the Project, or a
reasonably allocated share thereof,
(e) The costs of appraising, printing, estimates, advice, inspection, other
services of engineers, architects, accountants, financial consultants, attorneys at law, clerical help,
and other agents and employees;
(f) The costs of making, publishing, posting, mailing, and otherwise
giving any notice in connection with the Project and the issuance of the Bonds;
(g) All costs and expenses of issuing the Bonds including, without
limitation, fees of the Paying Agent, Bond Counsel, counsel to the Purchaser, counsel to the Town,
financial advisor, rating agencies, and printers to the extent not defrayed as an Operation and
Maintenance Expense;
(h) The costs of the filing or recording of instruments and the cost of
any title insurance premiums;
(i) The costs of funding any construction loans and other temporary
loans pertaining to the Project and of the incidental expenses incurred in connection with such
loans;
(j) The costs of demolishing, removing, or relocating any buildings,
structures, or other facilities on land acquired for the Project, and of acquiring lands to which such
buildings, structures or other facilities may be moved or relocated;
(k) The costs of machinery and equipment;
(1) The costs of any properties, rights, easements, or other interests in
properties, or any licenses, privileges, agreements, and franchises;
(m) The costs of labor, material, and obligations incurred to contractors,
builders, and materialmen in connection with the acquisition and construction of the Project;
(n) The costs of amending any ordinance or other instrument pertaining
to the Bonds or otherwise to the System; and
(o) All other expenses pertaining to the Project.
"C.R.S." means the Colorado Revised Statutes, as amended and supplemented
as of the date hereof.
"Events of Default" means the events stated in Section 1003 hereof.
"Federal Government" means the United States of America and any agency,
instrumentality or corporation thereof.
"Federal Securities" means bills, certificates of indebtedness, notes, or bonds
which are direct obligations of, or the principal and interest of which obligations are
unconditionally guaranteed by, the United States of America.
"Finance Director" means the Director of Finance of the Town, or his or her
successor in functions, if any.
"Fiscal Year" means the calendar year or any other 12-month period hereafter
selected by the Town as its fiscal year.
"Gross Revenues" means all fees (including but not limited to user fees and
plant investment fees), charges and revenues directly or indirectly derived by the Town for the
services furnished by, or use of, the System, or any part thereof, including all income attributable
to any future dispositions of property or rights related contracts, settlements, or judgments held or
obtained in connection with the System or its operations; provided however, that there shall be
excluded from Gross Revenue (a) moneys borrowed and used for providing Capital Improvements,
(b) any money and securities, and investment income therefrom, in any refunding fund, escrow
account, or similar account pledged to the payment of any bonds or other obligations for the
purpose of defeasing the same, and (c) any moneys received as grants or appropriations from the
United States, the State of Colorado, or other sources, the use of which is limited or restricted by
the grantor or donor to the provision of Capital Improvements or for other purposes resulting in
the general unavailability thereof, except to the extent any such moneys shall be received as
payments for the use of the System, services rendered thereby, the availability of any such service,
or the disposal of any commodities therefrom.
"improve' or "improvement" means the extension, reconstruction, alteration,
betterment or other improvement by the construction, purchase or other acquisition of facilities,
including, without limitation, appurtenant machinery, apparatus, fixtures, structures and buildings.
"Independent Accountant" means any certified public accountant, or any firm
of certified public accountants, duly licensed to practice and practicing as such under the laws of
the State:
(a) Who is, in fact, independent and not under the control of the Town;
(b) Who does not have any substantial interest, direct or indirect, with
the Town, and
(c) Who is not connected with the Town as an officer or employee
thereof, but who may be regularly retained to make annual or similar audits of any books or records
of the Town.
"Independent En tgineer" means an individual, firm or corporation engaged in
the engineering profession of recognized good standing and having specific experience in respect
of business and properties of a character similar to those of the System, which individual, firm or
corporation has no substantial interest, direct or indirect, in the Town and in the case of an
individual, is not a member of the Board, or an officer or employee of the Town, and in the case
of a firm or corporation, does not have a partner, director, officer or employee who is a member
of the Board or an officer or employee of the Town.
"Initial Purchaser" means the initial purchaser of the Bonds as set forth in the
Sale Certificate.
"Investment Securities" means any securities or other obligations permitted as
investments of moneys of the Town under the laws of the State.
"Mayor" means the mayor of the Town, or his or her successor in functions.
"Net Revenues" means the Gross Revenues remaining after the payment of the
Operation and Maintenance Expenses of the System.
"Operation and Maintenance Expenses" means all reasonable and necessary
current expenses of the Town, paid or accrued, for operating, maintaining, and repairing the
System, including without limitation legal and overhead expenses of the Town directly related to
the administration of the System; provided however, that there shall be excluded from Operation
and Maintenance Expenses any allowance or transfers for depreciation, payments in lieu of taxes
or franchise fees, legal liabilities not based on contract, expenses incurred in connection with
Capital Improvements, payments due in connection with any bonds or other obligations issued to
provide Capital Improvements, and charges for accumulation of reserves.
"Outstanding" when used with reference to the Bonds, the Parity Bonds, or
any other designated securities and as of any particular date means all the Bonds, the Parity Bonds,
or any such other securities payable from the Net Revenues or otherwise pertaining to the System,
as the case may be, in any manner theretofore and thereupon being executed and delivered:
(a) Except any Bond, Parity Bond, or other security canceled by the
Town, by any paying agent, or otherwise on the Town's behalf, at or before such date;
(b) Except any Bond, Parity Bond, or other security deemed to be paid
as provided in Section 1201 hereof or any similar provision of the ordinance authorizing the
issuance of such other security; and
(c) Except any Bond, Parity Bond, or other security in lieu of or in
substitution for which another Bond, Parity Bond, or other security shall have been executed and
delivered pursuant to Sections 306, 307 or 1 108 hereof or any similar provisions of the ordinance
authorizing the issuance of such other security.
"Owner" means the registered owner of any designated Bond, Parity Bond, or
other designated security.
"Parity Bonds" means the 2020 Bonds and any other securities hereafter issued
payable from and having an irrevocable lien upon the Net Revenues on a parity with the Bonds.
"Parity Bond Ordinances" means the 2020 Bond Ordinance, and any
agreements hereafter entered into by the Town with respect to Parity Bonds and, without
duplication, any ordinances hereafter adopted by the Board authorizing the issuance of Parity
Bonds.
"Paying Agent" means UMB Bank, n.a., in Denver, Colorado, being an agent
of the Town for the payment of the Bond Requirements due in connection with the Bonds, the
registrar for the Bonds and for other administration of moneys pertaining to the Bonds, and
includes any successor Commercial Bank as paying agent.
"Paying Agent Agreement" means the Registrar and Paying Agent Agreement
between the Town and the Paying Agent.
"Person" means a corporation, firm, other body corporate (including, without
limitation, the Federal Government, the State, or any other body corporate and politic other than
the Town), partnership, limited liability company, association or individual, and also includes an
executor, administrator, trustee, receiver or other representative appointed according to law.
"Project" means the acquisition, construction and installation of Capital
Improvements to the System, including the acquisition of water rights.
"Rebate Fund" means the special fund designated as the "Town of Firestone,
Colorado, Water Enterprise Revenue Bonds, Series 2022, Rebate Fund" created pursuant to
Section 609 hereof.
"Record Date" means the close of business on the fifteenth day (whether or
not a Business Day) of the calendar month next preceding an interest payment date.
"Redemption Date" means the date fixed for the redemption prior to their
respective maturities of any Bonds or other designated securities payable from Net Revenues in
any notice of prior redemption or otherwise fixed and designated by the Town.
"Reserve Fund" means the special fund designated as the "Town of Firestone,
Colorado, Water Enterprise Revenue Bonds, Series 2022, Reserve Fund" created pursuant to
Section 606 hereof.
"Reserve Fund Requirement" if any, has the meaning ascribed to such term in
the Sale Certificate.
"Sale Certificate" means the sale certificate of the Town relating to the Bonds
issued pursuant to the Supplemental Public Securities Act and described in Section 212 hereof.
"Special Record Date" means the record date for determining ownership of the
Bonds for purposes of paying accrued but unpaid interest, as such date may be determined pursuant
to this Ordinance.
"State" means the State of Colorado.
"Subordinate Securities" means securities payable from the Net Revenues
subordinate and junior to the lien thereon of the Bonds and any Parity Bonds.
"Supplemental Public Securities Act" means Part 2 of Article 57 of Title 11,
C.R.S., as amended.
"System" means the municipal water system consisting of all properties, real,
personal, mixed or otherwise, now owned or hereafter acquired by the Town, through purchase,
construction and otherwise, and used in connection with such system of the Town, and in any way
pertaining thereto, whether or not located within or without or both within and without the
boundaries of the Town.
"Tax Compliance Certificate" means the Tax Compliance and No Arbitrage
Certificate executed by the Town in connection with the initial issuance and delivery of the Bonds.
"Term Bonds" means Bonds that are payable on or before their specified
maturing dates from sinking fund payments established for that purpose and calculated to retire
such Bonds on or before their specified maturity dates.
"Town" means the Town of Firestone, Colorado, or any successor municipal
corporation owning the System.
"Town Clerk" means the town clerk of the Town, or his or her successor in
functions, if any.
"Town Manager" means the town manager of the Town, or his or her successor
in functions, if any.
"Trust Bank" means a Commercial Bank which is authorized to exercise and
is exercising trust powers located within or without the State, and also means any branch of the
Federal Reserve Bank.
"Water Enterprise Act" means Title 37, Article 45.1, C.R.S.
"Water Fund" means a special fund of the Town continued pursuant to Section
602 hereof, designated as the "Town of Firestone, Colorado, Water Fund."
"2020 Bond Ordinance" means the Town's Ordinance No. 937 dated May 27,
2020, authorizing the issuance of the 2020 Bonds.
"2020 Bonds" means the Town's Water Enterprise Revenue Bonds, Series
2020, issued pursuant to the 2020 Bond Ordinance.
Section 103. Parties Interested Herein. Nothing herein expressed or implied
confers any right, remedy or claim upon any Person, other than the Town, the Board, the Paying
Agent, the Owners of the Bonds and the Owners of any Parity Bonds or other securities payable
from the Net Revenues when reference is expressly made thereto. All the covenants, stipulations,
promises and agreements herein contained by and on behalf of the Town shall be for the sole and
exclusive benefit of the Town, the Board, the Paying Agent, the Owners of the Bonds and the
Owners of any such other securities in the event of such a reference.
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Section 104. Ratification; Approval of Documents. All action heretofore
taken (not inconsistent with the provisions of this Ordinance) by the Board, the officers, employees
and agents of the Town and otherwise taken by the Town directed toward the Project and the sale
and delivery of the Bonds for such purposes, be, and the same hereby is, ratified, approved and
confirmed.
Section 105. Re ep aler. All bylaws, orders, resolutions and ordinances, or parts
thereof, inconsistent herewith are hereby repealed to the extent only of such inconsistency. This
repealer shall not be construed to revive any such bylaw, order, resolution or ordinance, or part
thereof, heretofore repealed.
Section 106. Severability. If any section, subsection, paragraph, clause or
other provision of this Ordinance for any reason is invalid or unenforceable, the invalidity or
unenforeeability of such section, subsection, paragraph, clause or other provision shall not affect
any of the remaining provisions of this Ordinance.
Section 107. Ordinance Irrepealable. After any of the Bonds are issued, this
Ordinance shall constitute an irrevocable contract between the Town and the Owner or Owners of
the Bonds and this Ordinance shall be and shall remain irrepealable until the Bonds, as to all Bond
Requirements, shall be fully paid, canceled, and discharged, except as herein otherwise provided.
Section 108. Limitation of Actions. Pursuant to Section 11-57-212 of the
Supplemental Public Securities Act, no legal or equitable action brought with respect to any
legislative acts or proceedings of the Town in connection with the authorization or issuance of the
Bonds, including but not limited to the adoption of this Ordinance, shall be commenced more than
30 days after the authorization of the Bonds.
Section 109. Effective Date and Disposition. This Ordinance shall be in full
force and effect thirty (30) days after its passage and publication. This Ordinance, as adopted by
the Board, shall be numbered and recorded by the Town Clerk in the official records of the Town.
The adoption and publication shall be authenticated by the signatures of the Mayor and the Town
Clerk, and by the certificate of publication.
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ARTICLE I1
DETERMINATION OF THE TOWN'S AUTHORITY AND OBLIGATIONS;
APPROVAL OF RELATED DOCUMENTS; AND ELECTION TO
APPLY SUPPLEMENTAL PUBLIC SECURITIES ACT TO THE BONDS
Section 201. Authority for this Ordinance. This Ordinance is adopted by
virtue of the Town's power as a statutory municipality pursuant to Title 31, Article 16; Title 31,
Article 35, Part 4, C.R.S.; the Water Enterprise Act; the Supplemental Public Securities Act; and
all other laws of the State thereunto enabling.
Section 202. Bonds Equally Secured. The covenants and agreements herein
set forth to be performed on behalf of the Town shall be for the equal benefit, protection and
security of the Owners of any and all of the Outstanding Bonds and any Outstanding Parity Bonds
heretofore or hereafter authorized and issued, all of which, regardless of the time or times of their
issue or maturity, shall be of equal rank without preference, priority or distinction of any of such
securities over any other thereof, except as otherwise expressly provided in or pursuant to this
Ordinance.
Section 203. Special Obligations. All of the Bond Requirements of the Bonds
shall be payable and collectible solely out of the Net Revenues, which revenues are so pledged;
the Owner or Owners of the Bonds may not look to any general or other fund for the payment of
such Bond Requirements, except the herein designated special funds pledged therefor; the Bonds
shall not constitute an indebtedness or a debt within the meaning of any constitutional, or statutory
provision or limitation; and the Bonds shall not be considered or held to be general obligations of
the Town but shall constitute its special obligations. No statutory or constitutional provision
enacted after the issuance of the Bonds shall in any manner be construed as limiting or impairing
the obligation of the Town to comply with the provisions of this Ordinance or to pay the Bond
Requirements of the Bonds as herein provided.
Section 204. Character of Agreement. None of the covenants, agreements,
representations and warranties contained herein or in the Bonds shall ever impose or shall be
construed as imposing any liability, obligation or charge against the Town (except the special funds
pledged therefor), or against its general credit, or as payable out of its general fund or out of any
funds derived from taxation or out of any other revenue source (other than those pledged therefor).
Section 205. No Pledge of Property. The payment of the Bonds is not secured
by an encumbrance, mortgage or other pledge of property of the Town, except for the Net
Revenues and other moneys pledged for the payment of the Bond Requirements of the Bonds. No
property of the Town, subject to such exception, shall be liable to be forfeited or taken in payment
of the Bonds.
Section 206. No Recourse Against Officers or Agents. No recourse shall be
had for the payment of the Bond Requirements of the Bonds or for any claim based thereon or
otherwise upon this Ordinance or any other ordinance pertaining hereto, against any individual
member of the Board or any officer, employee or other agent of the Town, past, present or future,
either directly or indirectly through the Board, or the Town, or otherwise, whether by virtue of any
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penalty or otherwise, all such liability, if any, being by the acceptance of the Bonds and as part of
the consideration of their issuance specially waived and released.
Section 207. Authorization of the Project. The Board, on behalf of the Town,
does hereby determine to undertake the Project, which is hereby authorized, and the proceeds of
the Bonds shall be used therefor.
Section 208. Enterprise Status. The Board, on behalf of the Town, hereby
confirms its determination that the System shall be an "enterprise" for the purposes of Article X,
Section 20 of the State Constitution. In particular, the System shall be owned by the Town and
shall have the power to issue revenue bonds in the manner and payable from the sources set forth
in this Ordinance.
Section 209. Sale of Bonds. The Bonds shall be sold in a private placement to
the Initial Purchaser. Pursuant to the Supplemental Public Securities Act, the Board hereby
delegates to the Mayor, the Town Manager or the Finance Director the authority to execute the
any term sheet or proposal submitted by the Initial Purchaser and to execute the Sale Certificate
confirming the bond details subject to the parameters set forth in Section 212. Such authorization
shall be valid for one year following the adoption of this Ordinance.
Section 210. Paying Agent Agreement. The Board hereby determines to
approve the Paying Agent Agreement in substantially the form as is on file with the Town Clerk.
The Paying Agent may resign at anytime on 30 days' prior written notice to the Town. The Town
may remove the Paying Agent upon 30 days' prior written notice to the Paying Agent If the Paying
Agent appointed thereunder shall resign, or if the Town shall determine to remove the Paying
Agent, then the Town may appoint a successor Paying Agent, upon notice mailed to each Owner
of any Bond at such Person's address last shown on the registration records maintained by the
Paying Agent. No resignation or dismissal of the Paying Agent may take effect until a successor
has been appointed and has accepted the duties of the Paying Agent. Every such successor Paying
Agent shall be a Commercial Bank.
Section 211. Other Related Documents. The forms, terms and provisions of,
and the performance by the Town of its obligations under the Paying Agent Agreement are hereby
approved and the Mayor, the Town Manager, the Finance Director and/or the Town Clerk and any
deputy thereof are hereby authorized and directed to execute such documents on behalf of and in
the name of the Town, and to deliver such documents, in substantially the form on file with the
Town Clerk, with such changes as are not inconsistent herewith. The Mayor, the Town Manager
and the Finance Director are hereby independently authorized to execute and deliver the Sale
Certificate, and any term sheet that may be required by the Initial Purchaser relating to the Bonds.
The execution of any instrument by the Persons herein authorized shall be conclusive evidence of
the approval by the Town of such instrument in accordance with the terns hereof.
Section 212. Election to Apply Supplemental Public Securities Act to the
Bonds. Pursuant to Section 11-57-204 of the Supplemental Public Securities Act, a public entity,
including the Town, may elect in an act of issuance to apply all or any of the provisions of the
Supplemental Public Securities Act. The Board hereby elects to apply all of the provisions of the
Supplemental Public Securities Act to the Bonds. Pursuant to Section 11-57-205 of the
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Supplemental Public Securities Act, the Board hereby delegates to any of the Mayor, the Town
Manager or the Finance Director the authority to make the following determinations with respect
to the Bonds, subject to the parameters and restrictions contained in this Ordinance, without any
requirement that the Board approve such determinations:
(i) Interest Rate. The net effective rate of interest to be borne by the Bonds
shall not exceed 6.00% per annum;
(ii) Redemption Provisions. The Bonds shall be subject to optional redemption
at such time or times as permitted by State law and as set forth in the Sale Certificate, at a
redemption price not to exceed 103%.
(iii) Purchase Price. The purchase price of the Bonds shall not be less than 99%
of the aggregate principal amount of the Bonds;
(iv) Principal Amount. The aggregate principal amount of the Bonds shall not
exceed $29,000,000.
(v) Maturity Schedule. The amount of principal of the Bonds maturing in any
year, or mandatory sinking fund redemption payments coming due in any year, shall not be more
than $3,500,000 annually, and the total repayment cost of the Bonds shall not exceed $42,000,000.
2037. (vi) Term of the Bonds. The Bonds shall not mature later than December 1,
(viii) Capitalized Interest. The existence and amount of any capitalized interest
on the Bonds; and
(ix) Reserve Fund. The existence and amount of any Reserve Fund.
Such determinations shall be evidenced by the Sale Certificate signed by the Mayor,
the Town Manager or the Finance Director, dated and delivered prior to or as of the Closing Date,
which shall not be more than one year from the date of adoption of this Ordinance.
ARTICLE III
AUTHORIZATION, TERMS, EXECUTION AND
ISSUANCE OF BONDS
Section 301. Authorization of Bonds. For the purpose of protecting the public
health, conserving the property and advancing the general welfare of the citizens of the Town and
of defraying wholly or in part the Cost of the Project, the Town hereby authorizes to be issued its
"Town of Firestone, Colorado, Water Enterprise Revenue Bonds, Series 2022" in the aggregate
principal amount set forth in the Sale Certificate, subject to the parameters and restrictions
contained in this Ordinance; and the Town hereby pledges irrevocably, but not necessarily
exclusively, the Net Revenues to the payment of the Bond Requirements of the Bonds. The Bonds
are issued in accordance with the Constitution and laws of the State, specifically the Water
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Enterprise Act, Title 31, Article 35, C.R.S., Part 4, and the Supplemental Public Securities Act,
and the provisions of this Ordinance.
Section 302. Bond Details.
A. Basic Provisions. The Bonds shall be registered in the names of the Owners
thereof and shall not be registered in book -entry form. When the Bonds have been duly executed
by appropriate Town officers and authenticated by the Paying Agent, the Town shall cause the
Bonds to be delivered as directed by the Initial Purchaser on receipt of the agreed purchase price.
The Bonds shall be delivered in such denominations as the Initial Purchaser shall direct and shall
initially be registered in such name or names as the Initial Purchaser shall direct. The Bonds shall
mature on December 1, in the years and amounts and subject to prior redemption as set forth herein
and in the Sale Certificate. The Bonds shall bear interest from the most recent interest payment
date to which interest has been paid, or if no interest has been paid, from their date until their
respective maturities (or prior redemption) at the rates set forth in the Sale Certificate. No interest
shall accrue on any Bonds owned by or on behalf of the Town. Interest on the Bonds shall be
calculated as set forth in the Sale Certificate, payable semiannually on each June I and December
1, commencing on the date provided in the Sale Certificate.
B. Payment of Bonds. The principal of each Bond shall be payable at maturity
or upon prior redemption thereof at the principal corporate trust office of the Paying Agent, or at
such other office as the Paying Agent directs in writing to the Owners of the Bonds, or at the
principal office of its successor, upon presentation and surrender of the Bond. Payment of interest
on any Bond shall be made to the Owner thereof by the Paying Agent on or before each interest
payment date, (or, if such interest payment date is not a Business Day, on or before the next
succeeding Business Day), to such Owner at such Person's address as it appears on the registration
records kept by the Paying Agent on the Record Date; but any such interest not so timely paid or
duly provided for shall cease to be payable to the Person who is the Owner thereof at the close of
business on the Record Date and shall be payable to the Person who is the Owner thereof at the
close of business on a Special Record Date for the payment of any such defaulted interest. Such
Special Record Date and the date fixed for payment of such defaulted interest shall be fixed by the
Paying Agent whenever moneys become available for payment of the defaulted interest, and notice
of the Special Record Date shall be given to the Owners not less than ten days prior to the Special
Record Date by first-class mail to each such Owner as shown on the Paying Agent's registration
books on a date selected by the Paying Agent, stating the date of the Special Record Date and the
date fixed for the payment of such defaulted interest. The Paying Agent may make mandatory
sinking fund redemption payments and payments of interest on any Bond by such alternative
means as may be mutually agreed to between the Owner of such Bond and the Paying Agent. If
any Bond is not paid upon its presentation and surrender (if required) at or after its maturity or
prior redemption, interest shall continue at its stated rate per annum until the principal thereof is
paid in full. All such payments shall be made in lawful money of the United States of America.
So long as the Initial Purchaser is the sole owner of 100% of the Bonds, the
Initial Purchaser shall not be required to surrender the Bonds to the Paying Agent to receive
mandatory sinking fund payments in accordance with Section 402 hereof, but shall be required to
surrender such Bond on the final maturity date or upon prior redemption in accordance with
Section 401 hereof to receive such principal payment.
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Section 303. Execution of Bonds. The Bonds shall be executed in the name of
the Town by the manual or facsimile signature of the Mayor, shall be sealed with the corporate
seal of the Town or a facsimile thereof thereunto affixed, imprinted, engraved or otherwise
reproduced and shall be attested by the manual or facsimile signature of the Town Clerk. Any
Bond may be signed (manually or by facsimile), sealed or attested on behalf of the Town by any
person who, at the date of such act, shall hold the proper office, notwithstanding that at the date of
authentication, issuance or delivery, such person may have ceased to hold such office. The Mayor
and the Town Clerk may adopt as and for his or her own facsimile signature the facsimile signature
of his or her predecessor in office in the event that such facsimile signature appears on any of the
Bonds. Before the execution of any Bond by facsimile signature, the Mayor and the Town Clerk
shall each file with the Secretary of State of the State his or her manual signature certified by him
or her under oath.
Section 304. Authentication Certificate. The authentication certificate upon
the Bonds shall be substantially in the form and tenor provided in the form of the Bonds attached
to this Ordinance as Exhibit A. No Bond shall be secured hereby or entitled to the benefit hereof,
nor shall any Bond be valid or obligatory for any purpose, unless the certificate of authentication,
substantially in such form, has been duly executed by the Paying Agent and such certificate of the
Paying Agent upon any Bond shall be conclusive evidence that such Bond has been authenticated
and delivered hereunder. The certificate of authentication shall be deemed to have been duly
executed by it if manually signed by an authorized officer or employee of the Paying Agent, but it
shall not be necessary that the same officer or employee sign the certificate of authentication on
all of the Bonds.
Section 305. Registration and Payment. The Paying Agent shall keep or cause
to be kept sufficient records for the registration and transfer of the Bonds, which shall at all times
be open to inspection by the Town. Upon presentation for such purpose, the Paying Agent shall,
under such reasonable regulations as it may prescribe, register or transfer or cause to be registered
or transferred, on said records, Bonds as herein provided. Except as provided in Section 307
hereof, the Person in whose name any Bond shall be registered on the registration records kept by
the Paying Agent shall be deemed and regarded as the absolute owner thereof for the purpose of
making payment of the Bond Requirements thereof and for all other purposes; and payment of or
on account of the Bond Requirements of any Bond shall be made only to the Owner thereof or
such Person's legal representative, but such registration may be changed upon transfer of such
Bond in the manner and subject to the conditions and limitations provided herein. All such
payments shall be valid and effectual to discharge the liability upon such Bond to the extent of the
sum or sums so paid.
Section 306. Transfer and Exchange. Any Bond may be transferred upon the
records required to be kept pursuant to the provisions of Section 305 hereof by the Person in whose
name it is registered, in person or by such Person's duly authorized attorney, upon surrender of
such Bond for cancellation, accompanied by delivery of a written instrument of transfer in a form
approved by the Paying Agent, duly executed. Whenever any Bond or Bonds shall be surrendered
for transfer, the Paying Agent shall authenticate and deliver a new Bond or Bonds for a like
aggregate principal amount and of the same maturity and interest rate and of any authorized
denominations. The Bonds may be exchanged by the Paying Agent for a like aggregate principal
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amount of Bonds of the same maturity and interest rate and of other authorized denominations.
The execution by the Town of any Bond of any denomination shall constitute full and due
authorization of such denomination and the Paying Agent shall thereby be authorized to
authenticate and deliver such Bond.
The Paying Agent shall not be required to transfer or exchange (a) any Bond
subject to redemption during a period beginning at the opening of business 15 days before the day
of the mailing of a notice of redemption of Bonds and ending at the close of business on the day
such notice is mailed, or (b) any Bond so selected for redemption in whole or in part after the
mailing of notice calling such Bond or any portion thereof for prior redemption except the
unredeemed portion of Bonds being redeemed in part.
The Paying Agent shall require the payment by any Owner requesting exchange
or transfer of any tax or other governmental charge required to be paid with respect to such
exchange or transfer, and may charge a sum sufficient to pay the cost of preparing each new Bond
upon each exchange or transfer and any other expenses of the Town or the Paying Agent incurred
in connection therewith.
Section 307. Bond Replacement. Upon receipt by the Town and the Paying
Agent of evidence satisfactory to them of the ownership of and the loss, theft, destruction or
mutilation of any Bond and, in the case of a lost, stolen or destroyed Bond, of indemnity
satisfactory to them, and in the case of a mutilated Bond upon surrender and cancellation of the
Bond, (a) the Town shall execute and the Paying Agent shall authenticate and deliver a new Bond
of the same date, interest rate and denomination in lieu of such lost, stolen, destroyed or mutilated
Bond, or (b) if such lost, stolen, destroyed or mutilated Bond shall have matured or have been
called for redemption, in lieu of executing and delivering a new Bond as aforesaid, the Town may
pay such Bond. Any such new Bond shall bear a number not previously assigned. The applicant
for any such new Bond may be required to pay all expenses and charges of the Town and of the
Paying Agent in connection with the issuance of such Bond. All Bonds shall be held and owned
upon the express condition that, to the extent permitted by law, the foregoing conditions are
exclusive with respect to the replacement and payment of mutilated, destroyed, lost or stolen
Bonds, negotiable instruments or other securities.
Section 308. Bond Cancellation. Whenever any Bond shall be surrendered to
the Paying Agent upon payment thereof, or to the Paying Agent for transfer, exchange or
replacement as provided herein, such Bond shall be promptly canceled in accordance with the
customary practices of the Paying Agent and applicable retention laws.
Section 309. Conclusive Recitals. Pursuant to Section I 1-57-210 of the
Supplemental Public Securities Act and this Ordinance, the Bonds shall contain a recital that they
are issued pursuant to the Supplemental Public Securities Act. Such recital shall be conclusive
evidence of the validity and the regularity of the issuance of the Bonds after their delivery for
value. Pursuant to Section 31-35-413, C.R.S., and this Ordinance, the Bonds shall contain a recital
that they are issued pursuant to Title 31, Article 35, Part 4, C.R.S. Such recital shall conclusively
impart full compliance with all the provisions of such statute and Bonds issued containing such
recital shall be incontestable for any cause whatsoever after their delivery for value.
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Section 310. Bond Form. Subject to the provisions of this Ordinance, each
Bond shall be in substantially the form attached hereto as Exhibit A, with such omissions,
insertions, endorsements and variations as to any recitals of fact or other provisions as may be
required by the circumstances, be required or permitted by this Ordinance, be consistent with this
Ordinance or be necessary or appropriate to conform to the rules and requirements of any
governmental authority or any usage or requirement of law with respect thereto.
ARTICLE IV
REDEMPTION
Section 401. Optional Redemption. The Bonds may be subject to redemption
at the option of the Town from any legally available funds if set forth in the Sale Certificate.
Section 402. Mandatory Sinking Fund Redemption. The Term Bonds, if any,
shall be subject to mandatory sinking fund redemption at the times, in the amounts and at the prices
provided in the Sale Certificate.
On or before the thirtieth day prior to each such sinking fund payment date, the
Paying Agent shall proceed to call the Term Bonds, if any, as provided in the Sale Certificate (or
any Term Bond or Term Bonds issued to replace such Term Bonds) for redemption from the
sinking fund on the next December 1, and give notice of such call without further instruction or
notice from the Town.
At its option, to be exercised on or before the sixtieth day next preceding each
such sinking fund Redemption Date, the Town may (a) deliver to the Paying Agent for cancellation
Term Bonds subject to mandatory sinking fund redemption on such date in an aggregate principal
amount desired or (b) receive a credit in respect of its sinking fund redemption obligation for any
Term Bonds of the same maturity and interest rate subject to mandatory sinking fund redemption
on such date, which prior to said date have been redeemed (otherwise than through the operation
of the sinking fund) and canceled by the Paying Agent and not theretofore applied as a credit
against any sinking fund redemption obligation. Each Term Bond so delivered or previously
redeemed will be credited by the Paying Agent at the principal amount thereof against the
obligation of the Town on such sinking fund date and such sinking fund obligation will be
accordingly reduced. The Town will on or before the sixtieth day next preceding each sinking
fund Redemption Date furnish the Paying Agent with its certificate indicating whether or not and
to what extent the provisions of (a) and (b) of the first sentence of this paragraph are to be availed
with respect to such sinking fund payment. Failure of the Town to deliver such certificate shall
not affect the Paying Agent's duty to give notice of sinking fund redemption as provided in this
paragraph.
So long as the Initial Purchaser is the sole owner of 100% of the Bonds, the
Initial Purchaser shall not be required to surrender the Bonds to the Paying Agent to receive
payment in connection with a mandatory sinking fund redemption, but shall be required to
surrender such Bond on the final maturity date thereof to receive payment of the final principal
payment thereof.
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Section 403. Partial Redemption. If set forth in the Sale Certificate, a portion
of the Bonds may be redeemed, in which case the Paying Agent shall, without charge to the Owner
of such Bond, authenticate and issue a replacement Bond or Bonds for the unredeemed portion
thereof.
Section 404. Notice of Prior Redemption. Notice of optional or mandatory
redemption shall be given by the Paying Agent in the name of the Town by sending a copy of such
notice by first-class, postage prepaid mail, not more than 60 nor less than 30 days prior to the
Redemption Date to each Owner at such Person's address as it last appears on the registration
books kept by the Paying Agent; but neither failure to give such notice nor any defect therein shall
affect the redemption of any Bond. Such notice shall identify the Bonds to be so redeemed (if less
than all are to be redeemed) and the Redemption Date, and shall further state that on such
Redemption Date there will become and be due and payable upon each Bond to be so redeemed,
at the principal office of the Paying Agent, the principal amount thereof, accrued interest to the
Redemption Date, and the stipulated premium, if any, and that from and after such date interest
will cease to accrue. Notice having been given in the manner hereinabove provided, the Bond or
Bonds so called for redemption shall become due and payable on the Redemption Date so
designated; and upon presentation thereof at the principal office of the Paying Agent, the Paying
Agent will pay the Bond or Bonds so called for redemption. No further interest shall accrue on
the principal of any such Bond called for redemption from and after the Redemption Date, provided
sufficient funds are deposited with the Paying Agent and available on the Redemption Date.
Notwithstanding the provisions of this Section, any notice of redemption shall
either (a) contain a statement that the redemption is conditioned upon the receipt by the Paying
Agent on or before the Redemption Date of funds sufficient to pay the redemption price of the
Bonds so called for redemption, and that if such funds are not available, such redemption shall be
canceled by written notice to the Owners of the Bonds called for redemption in the same manner
as the original redemption notice was mailed, or (b) be given only if funds sufficient to pay the
redemption price of the Bonds so called for redemption are on deposit with the Paying Agent in
the applicable fund or account.
Section 405. Bonds Owned by the Town. Bonds owned by or on behalf of the
Town shall not be subject to redemption. At any time the Town may surrender any Bonds owned
by or on behalf of the Town to the Paying Agent, which shall promptly cancel such Bonds.
Additionally, any securities payable from any Net Revenues held by the Town
shall not be deemed to be Outstanding for the purpose of redemption nor Outstanding for the
purpose of consents hereunder or for any other purpose herein.
Section 406. No Partial Redemption After Default. Anything in this
Ordinance to the contrary notwithstanding, if there shall have occurred and is continuing an Event
of Default hereunder of which an officer of the Paying Agent has actual knowledge, there shall be
no redemption of less than all of the Bonds at the time Outstanding (other than pursuant to Section
402 hereof).
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ARTICLE V
USE OF BOND PROCEEDS AND OTHER MONEYS
Section 501. Disposition of Bond Proceeds. The proceeds of the Bonds, upon
the receipt thereof, and after the payment of the costs of issuing the Bonds, shall be accounted for
in the following manner and priority:
A. Reserve Fund. An amount equal to the Reserve Fund Requirement as
described in the Sale Certificate, if any, shall be credited to the special and separate account hereby
created and to be known as the "Town of Firestone, Colorado, Water Enterprise Revenue Bonds,
Series 2022, Reserve Fund."
B. Capitalized Interest. An amount designated in the Sale Certificate, if any,
shall be deposited into the Bond Fund and used to pay capitalized interest.
C. Acquisition Fund. The remaining proceeds derived from the sale of the
Bonds shall be credited to the special and separate account hereby created and held by the Town
to be known as the "Town of Firestone, Colorado, Water Enterprise Revenue Bonds, Series 2022,
Acquisition Fund."
Section 502. Payment of Ex enses. Moneys deposited in the Acquisition Fund
pursuant to Section 501 hereof may be used and paid out by the Town to defray the Cost of the
Project, including, without limitation, amounts to be paid to the Paying Agent, legal fees,
accounting fees, financial advisory fees, printing costs and rating fees. The Town may defray any
such administrative costs from time to time as Operation and Maintenance Expenses to the extent
the moneys deposited in the Acquisition Fund pursuant to Section 501 hereof are insufficient
therefor.
Section 503. Completion of the Project. When the Project is completed in
accordance with the relevant plans and specifications and all amounts due therefor, including all
proper incidental expenses and all administrative Costs of the Project referred to in Section 502
hereof, are paid, or for which full provision is made, the Finance Director, to the extent permitted
by the Tax Compliance Certificate, shall cause all surplus moneys remaining in the Acquisition
Fund, if any, except for any moneys designated in the certificate to be retained to pay any unpaid
accrued costs or contingent obligations, to be transferred: (a) to the Rebate Fund so as to enable
the Town to comply with the Tax Compliance Certificate and Section 930 hereof, (b) to the
Reserve Fund to such extent as shall not cause the amount in the Reserve Fund to exceed the
Reserve Fund Requirement and (c) to the Bond Fund to the extent of any remaining balance of
such moneys to be applied against the next principal payment or payments coming due on the
Bonds. Nothing herein prevents the transfer from the Acquisition Fund to the Bond Fund, at any
time prior to the termination of the Acquisition Fund, of any moneys that the Finance Director by
certificate determines will not be necessary for the Project and will not be designated to be
transferred to the Rebate Fund.
Section 504. Lien on Bond Proceeds. Until the proceeds of the Bonds
deposited in the Acquisition Fund are applied as herein provided, such Bond proceeds are subject
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to a lien thereon and pledge thereof for the benefit of the Owners of the Outstanding Bonds as
provided in Section 601 hereof.
Section 505. Initial Purchaser Not Responsible. The validity of the Bonds is
not dependent upon nor affected by the validity or regularity of any proceedings relating to the
application of the Bond proceeds. The Initial Purchaser and any subsequent Owners of any of the
Bonds are not responsible for the application or disposal by the Town or by any of its officers,
agents and employees of the moneys derived from the sale of the Bonds or of any other moneys
herein designated.
ARTICLE VI
ADMINISTRATION OF AND ACCOUNTING FOR
PLEDGED REVENUES
Section 601. Pledge Securing Bonds. Subject only to the right of the Town to
cause amounts to be withdrawn and paid on account of Operation and Maintenance Expenses of
the System, the Gross Revenues and, subject to the right of the Town to cause amounts to be
withdrawn to pay the Cost of the Project as provided herein and other than moneys and securities
held in the Rebate Fund to the extent such amounts are required to be paid to the United States, all
moneys and securities paid or to be paid to or held or to be held in any account under this Article
or under Section 501 hereof are hereby pledged to secure the payment of the Bond Requirements
of the Outstanding Bonds. The pledge of the Net Revenues to secure the payment of the Bond
Requirements of the Outstanding Bonds and any Outstanding Parity Bonds is on a parity with the
pledge of the Net Revenues for, and lien thereon of the Parity Bonds heretofore issued and any
Parity Bonds hereafter issued in compliance with the provisions of Article VHI hereof. The pledge
of the Net Revenues shall be valid and binding from and after the date of the delivery of the Bonds,
and the moneys as received by the Town and hereby pledged shall immediately be subject to the
lien of this pledge without any physical delivery thereof, any filing, or further act. The lien of this
pledge and the obligation to perform the contractual provisions hereby made shall have priority
over any or all other obligations and liabilities of the Town except any Outstanding Parity Bonds
heretofore or hereafter authorized. The lien of the pledge of the Net Revenues as described in this
Section shall be valid and binding as against all parties having claims of any kind in tort, contract,
or otherwise against the Town (except as herein otherwise provided) irrespective of whether such
parties have notice thereof.
Section 602. Water Fund Deposits. So long as any of the Bonds or any Parity
Bonds shall be Outstanding as to any Bond Requirements related to the Bonds or any Parity Bonds,
the entire Gross Revenues, upon their receipt from time to time by the Town, shall be set aside and
credited immediately to the special and separate account hereby continued and known as the
"Town of Firestone, Colorado, Water Fund."
Section 603. Administration of Water Fund. So long as any of the Bonds and
any Parity Bonds shall be Outstanding, as to any Bond Requirements related to the Bonds and any
Parity Bonds, the following payments shall be made from the Water Fund, as provided in Sections
604 through 611 hereof.
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Section 604. Operation and Maintenance Expenses. First, as a first charge on
the Water Fund, from time to time there shall continue to be held therein moneys sufficient to pay
Operation and Maintenance Expenses, as they become due and payable, and thereupon they shall
be promptly paid. Any surplus remaining in the Water Fund at the end of the Fiscal Year and not
needed for Operation and Maintenance Expenses shall be used for other purposes of the Water
Fund as herein provided.
Section 605. Bond Fund Payments. Second, from any remaining Net
Revenues, there shall be credited, concurrently with each other and with amounts required to meet
the Bond Requirements with respect to any Outstanding Parity Bonds, to the special and separate
account hereby created and to be known as the "Town of Firestone, Colorado, Water Enterprise
Revenue Bonds, Series 2022, Bond Fund" the following amounts:
A. Interest Payments. Monthly, commencing on the first day of the calendar
month immediately succeeding the delivery of any of the Bonds, to the Bond Fund, an amount in
equal monthly installments necessary, together with any moneys therein and available therefor, to
pay the interest due and payable on the Outstanding Bonds on the next succeeding interest payment
date.
B. Principal Payments. Monthly, commencing on the first day of the month
immediately succeeding the delivery of any of the Bonds, or commencing on the first day of the
month one year next prior to the first principal payment date of any of the Bonds, whichever
commencement date is later, an amount in equal monthly installments necessary, together with
any moneys therein and available therefor, to pay the principal and redemption premium, if any,
due and payable on the Outstanding Bonds on the next succeeding principal payment date.
If prior to any interest payment date or principal payment date, there has been
accumulated in the Bond Fund the entire amount necessary to pay the next maturing installment
of interest or principal, or both, the payment required in paragraph A or B (whichever is applicable)
of this Section 605 may be appropriately reduced; but the required annual amounts again shall be
so credited to such account commencing on such interest payment date or principal payment date.
The moneys credited to the Bond Fund shall be used to pay the Bond
Requirements of the Bonds then Outstanding, as such Bond Requirements become due, except as
provided in Sections 607, 608, 609, 703 and 1301 hereof. No interest or principal shall be paid on
any Bonds owned by or on behalf of the Town. Nothing herein shall be construed to prevent the
Town from creating separate principal and interest accounts for the Bonds and any Parity Bonds
and accounting separately for any deposits made thereto on account of the Bonds and any Parity
Bonds, if such action is deemed by the Town to be necessary or desirable, provided that any such
separate accounts shall have claims to the Net Revenues equal to and on a parity with those of the
other such accounts.
Section 606. Reserve Fund. Upon delivery of the Bonds, if specified in the
Sale Certificate, either proceeds of the Bonds or cash, or any combination thereof, in the amount
of the Reserve Fund Requirement shall be deposited in the special and separate account hereby
created and to be known as the "Town of Firestone, Colorado, Water Enterprise Revenue Bonds,
Series 2022, Reserve Fund" in satisfaction of the Reserve Fund Requirement.
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Thereafter, third, except as provided in Section 607 and 608 hereof, and
concurrently with any payments required to be made pursuant to any Parity Bond Ordinance with
respect to any reserve funds which may be, but are not required to be, established thereby and
concurrently with any repayment or similar obligations payable to any surety provider issuing any
reserve fund insurance policy with respect to any Parity Bonds, from any moneys remaining in the
Water Fund there shall be credited to the Reserve Fund monthly, commencing on the first day of
the month next succeeding each date on which the moneys accounted for in the Reserve Fund for
any reason are less than the Reserve Fund Requirement, such amounts in substantially equal
monthly payments on the first day of each month to re -accumulate the Reserve Fund Requirement
by not more than 12 such monthly payments. If there are insufficient Net Revenues to comply
with the requirements of the first sentence of this paragraph, available Net Revenues shall be
credited or paid to the Reserve Fund and to reserve funds which may be established by any Parity
Bond Ordinance (or to any other surety provider issuing any reserve fund insurance policy with
respect to any Parity Bonds) pro rata, based upon the aggregate principal amount of the Bonds and
any such Parity Bonds then Outstanding; provided, however, that compliance with the provisions
of this sentence shall not cure any Event of Default caused by non-compliance with the first
sentence of this paragraph. The Reserve Fund Requirement shall be accumulated and, if necessary,
re -accumulated from time to time, in the Reserve Fund from Net Revenues, except to the extent
other moneys are credited to the Reserve Fund, and maintained as a continuing reserve to be used,
except as hereinafter provided in Sections 607, 608, 609, 703 and 1201 hereof, only to prevent
deficiencies in the payment of the Bond Requirements of the Bonds Outstanding from time to time
from the failure to deposit into the Bond Fund sufficient moneys to pay such Bond Requirements
as the same accrue and become due. No payment need be made into the Reserve Fund at any time
so long as the moneys therein equal not less than the Reserve Fund Requirement. If set forth in
the Sale Certificate, the Reserve Fund Requirement may be re -calculated upon (i) any principal
payment, whether at stated maturity or upon redemption, or (ii) the defeasance of all or a portion
of the Bonds.
Section 607. Termination of Deposits. No payment need be made into the
Bond Fund or the Reserve Fund if the amount in the Bond Fund and the amount in the Reserve
total a sum at least sufficient so that all Outstanding Bonds are deemed to have been paid pursuant
to Section 1201 hereof, in which case moneys therein (taking into account the known minimum
gain from any investment of such moneys in Investment Securities from the time of any such
investment or deposit shall be needed for such payment which will not be designated for transfer
to the Rebate Fund) shall be used (together with any such gain from such investments) solely to
pay the Bond Requirements of the Outstanding Bonds as the same become due; and any moneys
in excess thereof in those two accounts and any other moneys derived from the Net Revenues or
otherwise pertaining to the System may be used to make required payments into the Rebate Fund
or in any other lawful manner determined by the Town, as directed in writing by the Finance
Director.
Section 608. Defraying Delinquencies. If at any time the Town shall for any
reason fail to pay into the Bond Fund the full amount above stipulated from the Net Revenues,
then an amount shall be paid into the Bond Fund at such time from the Reserve Fund equal to the
difference between that paid from the Net Revenues and the full amount so stipulated.
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Any money so used shall be replaced as provided in Section 606 hereof from the
first Net Revenues thereafter received and not required to be otherwise applied by this Article.
Except as provided in Sections 605, 606, 609, 703 and hereof, the moneys in the Bond Fund and
in the Reserve Fund shall be used solely and only for the purpose of paying the Bond Requirements
of the Bonds from time to time.
If the amount on deposit in the Reserve Fund exceeds the Reserve Fund
Requirement for any reason, the amount to be released from the Reserve Fund shall be as directed
in writing by the Finance Director. Any excess amount released from the Reserve Fund may be
deposited in the Bond Fund, the Rebate Fund, or deposited into a defeasance escrow account, or
may be applied for such other purposes authorized by law, as directed in writing by the Finance
Director.
Section 609. Rebate Fund. Fourth, concurrently with any payments required
to be made pursuant to any Parity Bond Ordinances with respect to any rebate funds established
thereby, there shall be deposited into the special and separate account hereby created and to be
known as the "Town of Firestone, Colorado, Water Enterprise Revenue Bonds, Series 2022,
Rebate Fund" moneys in the amounts and at the times specified in the Tax Compliance Certificate
so as to enable the Town to comply with Section 930 hereof. Amounts on deposit in the Rebate
Fund shall not be subject to the lien and pledge of this Ordinance to the extent that such amounts
are required to be paid to the United States Treasury. The Town shall cause amounts on deposit
in the Rebate Fund to be forwarded to the United States Treasury (at the address provided in the
Tax Compliance Certificate) at the times and in the amounts set forth in the Tax Compliance
Certificate.
If the moneys on deposit in the Rebate Fund are insufficient for the purposes
thereof, the Town shall transfer moneys in the amount of the insufficiency to the Rebate Fund from
the Acquisition Fund and, to the extent permitted by Section 608 hereof, from the Reserve Fund
and the Bond Fund. Upon receipt by the Town of an opinion of Bond Counsel to the effect that
the amount in the Rebate Fund is in excess of the amount required to be contained therein, such
excess may be transferred to the Water Fund.
Section 610. Payment of Additional Securities. Fifth, and subject to the
provisions hereinabove in this Article, but subsequent to the payments required by Sections 604,
605, 606 and 609 hereof, any moneys remaining in the Water Fund may be used by the Town for
the payment of Bond Requirements of Subordinate Securities, including reasonable reserves for
such Subordinate Securities and for rebate of amounts to the United States Treasury with respect
to such Subordinate Securities.
Section 611. Use of Remaining Revenues. After the payments hereinabove
required to be made by Sections 602 through 610 hereof are made, any remaining Net Revenues
in the Water Fund shall be used, first, for any one or any combination of reasonably necessary
purposes and in the Board's discretion relating to the operation, improvement or debt management
of the System and, second, to the extent of any remaining surplus, for any one or any combination
of lawful purposes as the Board may from time to time conclusively determine.
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ARTICLE VII
GENERAL ADMINISTRATION
Section 701. Administration of Accounts. The special accounts designated in
Articles V and VI hereof shall be administered as provided in this Article (but not any account
under Section 1201 hereof).
Section 702. Places and Times of Deposits. Except as hereinafter provided,
each of such special accounts shall be maintained by the Town as a book account and kept separate
from all other accounts as a trust account solely for the purposes herein designated therefor. The
moneys accounted for in such special book accounts may be in one or more bank accounts in one
or more Commercial Banks. Each such bank account shall be continuously secured to the fullest
extent required or permitted by the laws of the State for the securing of public funds and shall be
irrevocable and not withdrawable by anyone for any purpose other than the respective designated
purposes. Each periodic payment shall be credited to the proper book account not later than the
date therefor herein designated, except that when any such date shall not be a Business Day, then
such payment shall be made on or before the next preceding Business Day. Moneys shall be
deposited with the Paying Agent for the Bonds not less than (a) three Business Days prior to each
interest payment date and each maturity or mandatory Redemption Date, if funds are delivered by
wire transfer, or (b) five Business Days prior to each payment date if funds are delivered by another
method of payment, in immediately available amounts sufficient to pay the Bond Requirements
then becoming due on the Outstanding Bonds.
Section 703. Investment of Moneys. Any moneys in the Water Fund, the
Acquisition Fund, the Bond Fund, the Reserve Fund, and the Rebate Fund that are not needed for
immediate use shall be invested or reinvested by the Finance Director in Investment Securities.
All such investments shall (a) either be subject to redemption at any time at a fixed value by the
holder thereof at the option of such holder, or (b) mature not later than the estimated date or
respective dates on which the proceeds are to be expended as estimated by the Finance Director at
the time of such investment or reinvestment; provided that (1) Investment Securities credited to
the Reserve Fund shall not mature later than ten years from the date of such investment or
reinvestment and (2) collateral securities of any Investment Securities may have a maturity of more
than five years from the date of purchase thereof. For the purpose of any such investment or
reinvestment, Investment Securities shall be deemed to mature at the earliest date on which the
obligor is, on demand, obligated to pay a fixed sum in discharge of the whole of such obligations.
Section 704. Accounting for Investments. The Investment Securities so
purchased as an investment or reinvestment of moneys in any such account hereunder shall be
deemed at all times to be a part of the account. Any interest or other gain from any investments
and reinvestments of moneys accounted for in the Water Fund, the Acquisition Fund, the Bond
Fund, and the Rebate Fund shall be credited to such fund, and any loss resulting from any such
investments or reinvestments of moneys accounted for in the Water Fund, the Acquisition Fund,
the Bond Fund, the Reserve Fund and the Rebate Fund shall be charged or debited to such fund.
Any interest or other gain from any investment or reinvestment of moneys
accounted for in the Reserve Fund (a) shall be credited to the Rebate Fund or the Bond Fund, at
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the discretion of the Finance Director, if the amount credited to the Reserve Fund immediately
after such credit to the Rebate Fund or the Bond Fund is not less than the Reserve Fund
Requirement and (b) if the amount credited to the Reserve Fund is less than the Reserve Fund
Requirement, shall be credited to the Reserve Fund (up to the amount of the deficiency).
No loss or profit in any account on any investments or reinvestments in
Investment Securities shall be deemed to take place as a result of market fluctuations of the
Investment Securities prior to the sale or maturity thereof. In the computation of the amount in
any account for any purpose hereunder, except as herein otherwise expressly provided or for rebate
purposes, as described in the Tax Compliance Certificate, Investment Securities shall be valued at
the cost thereof (including any amount paid as accrued interest at the time of purchase of the
obligation); provided that any time or demand deposits shall be valued at the amounts deposited,
in each case exclusive of any accrued interest or any other gain to the Town until such gain is
realized by the presentation of matured coupons for payment or otherwise.
Section 705. Redemption or Sale of Investment Securities. The Finance
Director shall present for redemption or sale on the prevailing market at the best price obtainable
any Investment Securities so purchased as an investment or reinvestment of moneys in the account
whenever it shall be necessary in order to provide moneys to meet any withdrawal, payment or
transfer from such account. Neither the Finance Director nor any other officer, employee, or agent
of the Town shall be liable or responsible for any loss resulting from any such investment or
reinvestment made in accordance with this Ordinance.
Section 706. Character of Funds. The moneys in any account designated in
Articles V and VI hereof shall consist either of lawful money of the United States or Investment
Securities, or both such money and such Investment Securities. Moneys deposited in a demand or
time deposit account in a bank or savings and loan association, appropriately secured according to
the laws of the State, shall be deemed lawful money of the United States.
Section 707. Payment of Bond Requirements. The moneys credited to any
fund or account designated in Article VI hereof for the payment of the Bond Requirements of any
Bonds shall be used without requisition, voucher, warrant, further order or authority (other than as
contained herein), or any other preliminaries, to promptly pay the Bond Requirements of any
Bonds payable from such fund or account as such amounts are due, except to the extent any other
moneys are available therefor.
ARTICLE VIIT
SECURITIES LIENS AND ADDITIONAL SECURITIES
Section 801. Lien on Bonds. The Bonds constitute an irrevocable lien (but not
necessarily an exclusive lien) upon the Net Revenues on a panty with the lien on the Net Revenues
of the Parity Bonds.
Section 802. Equality of Bonds. The Bonds and any Parity Bonds heretofore
issued or hereafter authorized to be issued and from time to time Outstanding are equitably and
ratably secured by a lien on the Net Revenues and shall not be entitled to any priority over one
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another in the application of the Net Revenues regardless of the time or times of the issuance of
the Bonds and any other such Parity Bonds, it being the intention of the Board that there shall be
no priority among the Bonds and any such Parity Bonds regardless of the fact that they may be
actually issued and delivered at different times, except that (a) moneys in the Acquisition Fund,
the Bond Fund and the Reserve Fund shall secure only the Bonds and the moneys in any
acquisition, bond, reserve or similar funds established for Parity Bonds shall secure only such
Parity Bonds and (b) Parity Bonds may have a lien on Net Revenues on a parity with the lien
thereon of the Bonds even if no reserve fund is established for such Parity Bonds or a reserve fund
is established but with a different requirement as to the amount of moneys (or the value of a reserve
fund insurance policy with respect to such Parity Bonds) required to be on deposit therein or the
manner in which such reserve fund is funded or the period of time over which such reserve fund
is funded.
Section 803. Issuance of Parity Bonds. Nothing herein prevents the issuance
by the Town of additional securities payable from the Net Revenues and constituting a lien thereon
on a parity with, but not prior nor superior to, the lien thereon of the Bonds; but before any such
additional Parity Bonds, except as provided in Section 808, are authorized or actually issued: all
of the following conditions must be satisfied:
A. Absence of Default. At the time of the adoption of the ordinance
authorizing the issuance of the additional securities, the Town shall not be in default in making
any payments required by Article VI hereof or by other Parity Bond Ordinances.
B. Historic Earnings Test. The Net Revenues for any consecutive 12-month
period within the 18 months immediately preceding the date of issuance of the additional Parity
Bonds shall not be less than the sum of (a) 125% of the Combined Maximum Annual Principal
and Interest Requirements of the Outstanding Bonds, any Outstanding Parity Bonds and the Parity
Bonds proposed to be issued, and (b) 100% of the policy costs relating to any Parity Bonds then
due and owing, if any, except as hereinafter otherwise expressly provided.
C. Adjustment of Gross Revenues. In any computation under paragraph B of
this Section, the amount of the Gross Revenues for the applicable period shall be decreased and
may be increased by the amount of loss or gain conservatively estimated by an Independent
Accountant, Independent Engineer or the Finance Director, as the case may be, which results from
any changes which became effective not less than 60 days prior to the last day of the period for
which Gross Revenues are determined, in any schedule of fees, rates and other charges constituting
Gross Revenues based on the number of users during the applicable period as if such modified
schedule of fees, rates and other charges shall have been in effect during such entire time period.
However, the Gross Revenues need not be decreased by the amount of any such estimated loss to
the extent the Independent Accountant, the Independent Engineer, or the Finance Director
estimates the loss is temporary in nature or will be offset within a reasonable temporary period by
an increase in revenues or a reduction in Operation and Maintenance Expenses not otherwise
included in the calculations under this Section, and estimates any loss under this sentence will not
at any time materially and adversely affect the Town's apparent ability to comply with the rate
maintenance covenant stated in Section 921 hereof without modification because of any restrictive
legislation, regulation, or other action under the police power exercised by any governmental body.
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D. Reduction of Annual Requirements. The respective annual Bond
Requirements (including as such, the required amount of any prior redemption premiums due on
any Redemption Date) shall be reduced to the extent such Bond Requirements are scheduled to be
paid in each of the respective Fiscal Years with moneys held in trust or in escrow for that purpose
by any Trust Bank, including the known minimum yield from any investment in Federal Securities
and any bank deposits, including any certificate of deposit.
E. Consideration of Additional Expenses. In determining whether or not
additional Parity Bonds may be issued as aforesaid, consideration shall be given to any probable
increase (but not reduction) in the Operation and Maintenance Expenses of the System as estimated
by the Finance Director that will result from the expenditure of the funds proposed to be derived
from the issuance and sale of the additional securities; but the Finance Director may reduce any
such increase in Operation and Maintenance Expenses by the amount of any increase in revenues
or any reduction in Operation and Maintenance Expenses resulting from the Capital Improvements
to which such expenditure relates and not otherwise included in the calculations under this Section,
if the Finance Director also opines that any such increase in revenues or reduction in any such
increase in Operation and Maintenance Expenses will not materially and adversely affect the
Town's apparent ability to comply with the rate maintenance covenant stated in Section 921 hereof
without modification because of any restrictive legislation, regulation, or other action under the
police power exercised by any governmental body.
Section 804. Certification of Revenues. A written certificate or written
opinion by the Finance Director under paragraph B of Section 803 hereof that such annual
revenues, when adjusted as hereinabove provided in paragraphs C, D, and E of Section 803 hereof,
are sufficient to pay such amounts, as provided in paragraph B of Section 803 hereof, shall be
conclusively presumed to be accurate in determining the right of the Town to authorize, issue, sell
and deliver additional securities on a parity with the Bonds.
Section 805. Subordinate Securities Permitted. Nothing herein prevents the
Town from issuing additional securities payable from the Net Revenues and having a lien thereon
subordinate, inferior and junior to the lien thereon of the Bonds.
Section 806. Superior Securities Prohibited. Nothing herein permits the Town
to issue additional securities payable from the Net Revenues and having a lien thereon prior and
superior to the lien thereon of the Bonds.
Section 807. Use of Proceeds. The proceeds of any Parity Bonds or other
securities payable from any Net Revenues shall be used only to finance Capital Improvements
and/or to refund all or any portion of the Bonds, Parity Bonds, or other securities payable from Net
Revenues, regardless of the priority or the lien of such securities on Net Revenues.
Section 808. Issuance of Refunding Securities. The Town may issue any
refunding securities payable from Net Revenues to refund any Outstanding Bonds, Parity Bonds
or any Subordinate Securities heretofore or hereafter issued, with such details as the Board may
by ordinance provide so long as there is no material impairment of any contractual obligation
imposed upon the Town by any proceedings authorizing the issuance of any unrefunded portion
of such Outstanding securities of any one or more issues; but so long as the Bonds, or any part
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thereof, are Outstanding, refunding securities payable from Net Revenues may be issued on a
parity with the unrefunded Bonds only if:
A. Prior Consent. The Town first receives the consent of the Owner or Owners
of the unrefunded portion of the Bonds; or
B. Requirements Not Increased. The Combined Maximum Annual Principal
and Interest Requirements for the Bonds and Parity Bonds Outstanding immediately after the
issuance of the refunding securities is not greater than the Combined Maximum Annual Principal
and Interest Requirements for all Bonds and Parity Bonds Outstanding immediately prior to the
issuance of the refunding securities and the lien of any refunding Parity Bonds on the Net Revenues
is not raised to a higher priority than the lien thereon of any securities thereby refunded; or
C. Earnings Test. The refunding securities are issued in compliance with
paragraph B of Section 803 hereof.
ARTICLE IX
PROTECTIVE COVENANTS
Section 901. General. The Town hereby covenants and agrees with the
Owners of the Bonds and makes provisions which shall be a part of its contract with such Owners
to the effect and with the purpose set forth in the following Sections of this Article.
Section 902. Performance of Duties. The Town, acting by and through the
Board or otherwise, shall faithfully and punctually perform, or cause to be performed, all duties
with respect to the Gross Revenues and the System required by the Constitution and laws of the
State and the various ordinances of the Town, including, without limitation, the making and
collection of reasonable and sufficient fees, rates and other charges for services rendered or
furnished by or from the use of the System, as herein provided, and the proper segregation of the
proceeds of the Bonds and of any securities hereafter authorized and the Gross Revenues and their
application from time to time to the respective accounts provided therefor.
Section 903. Contractual Obligations. The Town shall reasonably perform all
contractual obligations undertaken by it under any agreements relating to the Bonds, the Gross
Revenues, the Project, or the System, or any combination thereof, with any other Persons.
Section 904. Further Assurances. At any and all times the Town shall, so far
as it may be authorized by law, pass, make, do, execute, acknowledge, deliver and file or record
all and every such further instruments, acts, deeds, conveyances, assignments, transfers, other
documents and assurances as may be reasonably necessary or desirable for the better assuring,
conveying, granting, assigning and confirming all and singular the rights, the Gross Revenues, and
other moneys and accounts hereby pledged or assigned, or intended so pledged or assigned, or
which the Town may hereafter become bound to pledge or to assign, or as may be reasonable and
required to carry out the purposes of this Ordinance and to comply with any instrument of the
Town amendatory thereof, or supplemental thereto. The Town, acting by and through the Board,
or otherwise, shall at all times, to the extent permitted by law, reasonably defend, preserve and
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protect the pledge of the Gross Revenues and other moneys and accounts pledged hereunder and
all the rights of every Owner of any Bond hereunder against all claims and demands of all Persons
whomsoever.
Section 905. Conditions Precedent. Upon the date of issuance of the Bonds,
all conditions, acts and things required by the Federal or State Constitution, Title 31, Article 35,
Part 4, C.R.S., the Water Enterprise Act, the Supplemental Public Securities Act and this
Ordinance, or any other applicable law to exist, to have happened and to have been performed
precedent to or in the issuance of the Bonds shall exist, have happened, and have been performed;
and the Bonds, together with all other obligations of the Town, shall not contravene any debt or
other limitation prescribed by the State Constitution.
Section 906. Efficient Operation and Maintenance. The Town shall at all
times operate the System properly and in a sound and economical manner; and the Town shall
maintain, preserve and keep the same properly or cause the same to be so maintained, preserved
and kept, with the appurtenances and every part and parcel thereof in good repair, working order
and condition, and shall from time to time make or cause to be made all necessary and proper
repairs, replacements and renewals so that at all times the operation of the System may be properly
and advantageously conducted. All salaries, fees, wages and other compensation paid by the Town
in connection with the maintenance, repair and operation of the System shall be reasonable and
proper.
Section 907. Rules, Regulations and Other Details. The Town, acting by and
through the Board, shall establish and enforce reasonable rules and regulations governing the
operation, use and services of the System. The Town shall observe and perform all of the terms
and conditions contained in this Ordinance and shall comply with all valid acts, rules, regulations,
orders and directions of any legislative, executive, administrative or judicial body applicable to the
System or to the Town, except for any period during which the same are being contested in good
faith by proper legal proceedings.
Section 908. Payment of Governmental Charges. The Town shall pay or cause
to be paid all taxes and assessments or other governmental charges, if any, lawfully levied or
assessed upon or in respect of the System, or upon any part thereof, or upon any portion of the
Gross Revenues, when the same shall become due, and shall duly observe and comply with all
valid requirements of any governmental authority relative to the System or any part thereof, except
for any period during which the same are being contested in good faith by proper legal proceedings.
The Town shall not create or suffer to be created any lien upon the System, or any part thereof, or
upon the Gross Revenues, except the pledge and lien created by this Ordinance for the payment of
the Bond Requirements of the Bonds and except as herein otherwise permitted. The Town shall
pay or cause to be discharged or shall make adequate provision to satisfy and to discharge, within
60 days after the same shall become payable, all lawful claims and demands for labor, materials,
supplies or other objects which, if unpaid, might by law become a lien upon the System, or any
part thereof, or the Gross Revenues; but nothing herein requires the Town to pay or cause to be
discharged or to make provision for any such tax, assessment, lien or charge, so long as the validity
thereof is contested in good faith and by appropriate legal proceedings.
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Section 909. Protection of Security. The Town, the officers, agents and
employees of the Town, and the Board shall not take any action in such manner or to such extent
as might materially prejudice the security for the payment of the Bond Requirements of the Bonds,
the Parity Bonds and any other securities payable from the Net Revenues according to the terms
thereof. No contract shall be entered into nor any other action taken by which the rights of any
Owner of any Bond or other security payable from Net Revenues might be prejudicially and
materially impaired or diminished.
Section 910. Prompt Payment of Bonds. The Town shall promptly pay the
Bond Requirements of the Bonds at the places, on the dates and in the manner specified herein and
in the Bonds according to the true intent and meaning hereof.
Section 911. Use of Bond and Reserve Funds. The Bond Fund and the Reserve
Fund shall be used solely and only, and the moneys credited to such accounts are hereby pledged
for the purpose of paying the Bond Requirements of the Bonds to their respective maturities or
any Redemption Date or Dates, subject to the provisions of Sections 605, 606, 607, 608, 609, 703
and 1201 hereof.
Section 912. Other Liens. Other than as provided herein, there are no liens or
encumbrances of any nature whatsoever on or against the System, or any part thereof, or on or
against the Gross Revenues on a parity with or superior to the lien thereon of the Bonds.
Section 913. Corporate Existence. The Town shall maintain its corporate
identity and existence so long as any of the Bonds remain Outstanding, unless another body
corporate and politic by operation of law succeeds to the powers, privileges, rights, liabilities,
disabilities, duties and immunities of the Town and is obligated by law to operate and maintain the
System and to fix and collect the Gross Revenues as herein provided without adversely and
materially affecting at any time the privileges and rights of any Owner of any Outstanding Bond.
Section 914. Disposal of System Prohibited. Except for the use of the System
and services pertaining thereto in the normal course of business, or as provided in Section 915
hereof, neither all nor a substantial part of the System shall be sold, leased, mortgaged, pledged,
encumbered, alienated or otherwise disposed of, until all the Bonds have been paid in full, as to
all Bond Requirements, or unless provision has been made therefor, or until the Bonds have
otherwise been redeemed, including, without limitation, the termination of the pledge as herein
authorized; and the Town shall not dispose of its title to the System or to any useful part thereof,
including any property necessary to the operation and use of the System and the lands and interests
in lands comprising the sites of the System, except as provided in Section 915 hereof.
Section 915. Disposal of Unnecessary Property. The Town at any time and
from time to time may sell, exchange, lease or otherwise dispose of any property constituting a
part of the System and not useful in the construction, reconstruction or operation thereof, or which
shall cease to be necessary for the efficient operation of the System, or which shall have been
replaced by other property of at least equal value. Any proceeds of any such sale, exchange, lease
or other disposition received and not used to replace such property so sold or so exchanged or
otherwise so disposed of, shall be deposited by the Town in the Water Fund or into a special book
account for the betterment, enlargement, extension, other improvement and equipment of the
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System, or any combination thereof, as the Board may determine, provided that any proceeds of
any such lease received shall be deposited by the Town as Gross Revenues in the Water Fund.
Section 916. Competing System. So long as any of the Bonds are Outstanding,
the Town shall not grant any franchise or license to any competing facilities so that the Gross
Revenues shall not be sufficient to satisfy the covenant in Section 921 hereof.
Section 917. Loss From Condemnation. If any part of the System is taken by
the exercise of the power of eminent domain, the amount of any award received by the Town as a
result of such taking shall be paid into the Water Fund or into a capital improvement account
pertaining to the System for the purposes thereof, or, applied to the redemption of the Outstanding
Bonds and any Outstanding Parity Bonds relating thereto, all as the Town may determine.
Section 918. Employment of Management Engineers. If the Town defaults in
paying the Bond Requirements of the Bonds, the Parity Bonds, and any other securities payable
from the Gross Revenues promptly as the same fall due, or an Event of Default has occurred and
is continuing, or if the Net Revenues in any Fiscal Year fail to equal at least the amount of the
Bond Requirements of the Outstanding Bonds, Parity Bonds, and any other securities (including
all reserves therefor specified in the authorizing proceedings, including, without limitation, this
Ordinance) payable from the Net Revenues in that Fiscal Year, the Town shall retain a firm of
competent management engineers skilled in the operation of such facilities to assist the
management of the System so long as such default continues or so long as the Net Revenues are
less than the amount hereinabove designated in this Section.
Section 919. Budgets. The Board and officials of the Town shall annually and
at such other times as may be provided by law prepare and adopt a budget pertaining to the System.
Section 920. Reasonable and Adequate Charges. While the Bonds remain
Outstanding and unpaid, the fees, rates and other charges due to the Town for the use of or
otherwise pertaining to and services rendered by the System to the Town, to its inhabitants and to
all other users within and without the boundaries of the Town shall be reasonable and just, taking
into account and consideration public interests and needs, the cost and value of the System, the
Operation and Maintenance Expenses thereof, and the amounts necessary to meet the Bond
Requirements of all Bonds, Parity Bonds, and any other securities payable from the Net Revenues,
including, without limitation, reserves and any replacement accounts therefor.
Section 921. Adequacy and Applicability of Charges. There shall be charged
against users of service pertaining to and users of the System, including the Town, except as
provided by Section 922 hereof, such fees, rates and other charges so that the Gross Revenues shall
be adequate to meet the requirements of this and the preceding Sections hereof. Such charges
pertaining to the System shall be at least sufficient so that the Gross Revenues annually are
sufficient to pay in each Fiscal Year:
A. Operation and Maintenance Expenses. An amount equal to the annual
Operation and Maintenance Expenses for such Fiscal Year,
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B. Principal and Interest. An amount equal to 125% of both the principal and
interest on the Bonds and any Parity Bonds then Outstanding payable from the Net Revenues in
that Fiscal Year (excluding the reserves therefor), and
C. Deficiencies. Any amounts required to pay all sums, if any, due and owing
to meet then existing deficiencies pertaining to any fund or account relating to the Gross Revenues
or any securities payable therefrom.
Section 922. Limitations Upon Free Service. No free service or facilities shall
be furnished by the System, except as hereinafter provided. If the Town elects to use for municipal
purposes any water, water facilities, or other services and facilities provided by the System or
otherwise to use the System or any part thereof, any such use will be paid for from the Town's
general fund or from other available revenues other than Gross Revenues at the reasonable value
of the use so made; provided that the Town need not pay for any such use by the Town of any
facilities of the water system for fire protection purposes. All the income so derived from the
Town shall be deemed to be income derived from the operation of the System, to be used and to
be accounted for in the same manner as any other income derived from the operation of the System.
Nothing in this Ordinance prohibits the Town from waiving any tap fee or development fee
imposed as a condition for a user to connect to the System, so long as the user is a governmental
body.
Section 923. Levy of Charges. The Town shall forthwith and in any event
prior to the delivery of any of the Bonds, fix, establish and levy the fees, rates and other charges
which are required by Section 921 of this Ordinance, if such action is necessary therefor. No
reduction in any initial or existing rate schedule for the System may be made:
A. Proper Application. Unless the Town has fully complied with the
provisions of Article VI of this Ordinance for at least the full Fiscal Year immediately preceding
such reduction of the initial or any other existing rate schedule; and
B. Sufficient Revenues. Unless the audit required by the Independent
Accountant by Section 927 hereof for the full Fiscal Year immediately preceding such reduction
discloses that the estimated revenues resulting from the proposed rate schedule for the System,
after the schedule's proposed reduction, shall be at least sufficient to produce the amounts required
by Section 921 hereof.
Section 924. Collection of Charges. The Town shall use commercially
reasonable best efforts to cause all fees, rates and other charges pertaining to the System to be
collected as soon as is reasonable, shall reasonably prescribe and enforce rules and regulations or
impose contractual obligations for the payment of such charges, and for the use of the System, and
shall provide methods of collection and penalties, to the end that the Gross Revenues shall be
adequate to meet the requirements of this Ordinance and any other ordinance supplemental thereto.
Section 925. Procedure for Collecting Charges. All bills for water services or
facilities and all other services or facilities furnished or served by or through the System shall be
rendered to customers on a regularly established basis. The fees, rates and other charges due shall
be collected in a lawful manner, including, without limitation, discontinuance of service.
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Section 926. Maintenance of Records. So long as any of the Bonds and any
Parity Bonds payable from the Gross Revenues remain Outstanding, proper books of record and
account shall be kept by the Town, separate and apart from all other records and accounts.
Section 927. Audits Required. The Town, within 180 days following the close
of each Fiscal Year, shall order an audit for the Fiscal Year of such books and accounts to be made
forthwith by an Independent Accountant, and order an audit report showing the receipts and
disbursements for each account pertaining to the System and the Gross Revenues.
Section 928. Accounting Principles. System records and accounts, and audits
thereof, shall be currently kept and made, as nearly as practicable, in accordance with the then
generally accepted accounting principles, methods and terminology followed and construed for
utility operations comparable to the System, except as may be otherwise provided herein or
required by applicable law or regulation or by contractual obligation existing on the effective date
of this Ordinance.
Section 929. Insurance and Reconstruction. F,xcept to the extent of any self-
insurance, the Town shall at all times maintain with responsible insurers fire and extended
coverage insurance, worker's compensation insurance, public liability insurance and all such other
insurance as is customarily maintained with respect to utilities of like character against loss of or
damage to the System and against loss of revenues and against public and other liability to the
extent reasonably necessary to protect the interests of the Town and of each Owner of a Bond. If
any useful part of the System shall be damaged or destroyed, the Town shall, as expeditiously as
may be possible, commence and diligently proceed with the repair or replacement of the damaged
property so as to restore the same to use. The proceeds of any such insurance shall be payable to
the Town and (except for proceeds of any use and occupancy insurance) shall be applied to the
necessary costs involved in such repair and replacement and to the extent not so applied shall
(together with the proceeds of any such use and occupancy insurance) be deposited in the Water
Fund by the Town as revenues derived from the operation of the System. If the costs of such repair
and replacement of the damaged property exceed the proceeds of such insurance available for the
payment of the same, moneys in the Water Fund may be used to the extent necessary for such
purposes, as permitted by Section 611 hereof.
Section 930. Federal Income Tax Exemption. The Town covenants for the
benefit of the Owners of the Bonds at any time Outstanding that it will not take any action or omit
to take any action with respect to the Bonds, the proceeds thereof, any other funds of the Town or
any facilities financed or refinanced with the proceeds of the Bonds if such action or omission (a)
would cause the interest on the Bonds to lose its exclusion from gross income for federal income
tax purposes under Section 103 of the Code, (b) would cause interest on the Bonds to become a
specific preference item for purposes of federal alternative minimum tax under the Code, except
as such interest is taken into account in determining the annual adjusted financial statement income
of applicable corporations (as defined in Section 59(k) of the Tax Code) for the purpose of
computing the alternative minimum tax imposed on corporations for tax years beginning after
December 31, 2022, or (c) would cause the Bonds and the income therefrom to lose their
exemption from taxation, except inheritance, estate, and transfer taxes under present State law. In
furtherance of this covenant, the Town agrees to comply with the procedures set forth in the Tax
Compliance Certificate. The foregoing covenant shall remain in full force and effect
33
notwithstanding the payment in full or defeasance of the Bonds until the date on which all
obligations of the Town in fulfilling the above covenant under the Code and Colorado law have
been met.
ARTICLE X
PRIVILEGES, RIGHTS AND REMEDIES
Section 1001. Owners' Remedies. Each Owner of any Bond shall be entitled to
all of the privileges, rights and remedies provided or permitted by this Ordinance, and as otherwise
provided or permitted by law or in equity or by any statutes, except as provided in Sections 202
through 206 hereof, but subject to the provisions herein concerning the pledge of and the covenants
and the other contractual provisions concerning the Gross Revenues and the proceeds of the Bonds.
Section 1002. Right to Enforce Payment. Nothing in this Article affects or
impairs the right of any Owner of any Bond to enforce the payment of the Bond Requirements due
in connection with such Person's Bond or the obligation of the Town to pay the Bond
Requirements of each Bond to the Owner thereof at the time and the place expressed in the Bond.
Section 1003. Events of Default. Each of the following events is hereby
declared an "Event of Default":
A. Nonpayment of Principal. Payment of the principal of any of the Bonds is
not made when the same becomes due and payable, either at maturity or by proceedings for prior
redemption, or otherwise;
B. Nonpayment of Interest. Payment of any installment of interest on any of
the Bonds is not made when the same becomes due and payable;
C. Cross Defaults. The occurrence and continuance of an "event of default,"
as defined in any Parity Bond Ordinance;
D. Failure to Reconstruct. The Town unreasonably delays or fails to carry out
with reasonable dispatch the reconstruction of any part of the System which is destroyed or
damaged and is not promptly repaired or replaced (whether such failure promptly to repair the
same is due to impracticability of such repair or replacement or is due to a lack of moneys therefor
or for any other reason), but it shall not be an Event of Default if such reconstruction is not essential
to the efficient operation of the System;
E. Appointment of Receiver. An order or decree is entered by a court of
competent jurisdiction with the consent or acquiescence of the Town appointing a receiver or
receivers for the System or for the Gross Revenues and any other moneys subject to the lien to
secure the payment of the Bonds, or if an order or decree having been entered without the consent
or acquiescence of the Town is not vacated or discharged or stayed on appeal within 60 days after
entry; and
34
F. Default of Any Provision. The Town defaults in the due and punctual
performance of any other of the representations, covenants, conditions, agreements and other
provisions contained in the Bonds or in this Ordinance on its part to be performed, and such default
continues for 60 days after written notice specifying such default and requiring the same to be
remedied is given to the Town specifying the failure and requiring that it be remedied, which notice
may be given by the Paying Agent in its discretion, and shall be given by the Paying Agent at the
written request of the Owners of not less than 25% in aggregate principal amount of Bonds then
Outstanding.
Section 1004. Remedies for Defaults. Upon the happening and continuance of
any Event of Default, the Owner or Owners of not less than 25% in aggregate principal amount of
the Bonds then Outstanding, including, without limitation, a trustee or trustees therefor, may
proceed against the Town and its agents, officers and employees to protect and to enforce the rights
of any Owner of Bonds under this Ordinance by mandamus or by other suit, action or special
proceedings in equity or at law, in any court of competent jurisdiction, either for the appointment
of a receiver or for the specific performance of any covenant or agreement contained herein or in
an award of execution of any power herein granted for the enforcement of any proper legal or
equitable remedy as such Owner or Owners may deem most effectual to protect and to enforce the
rights aforesaid, or thereby to enjoin any act or thing which may be unlawful or in violation of any
right of any Owner of any Bond, or to require the Town to act as if it were the trustee of an
expressed trust, or any combination of such remedies. All such proceedings at law or in equity
shall be instituted, had and maintained for the equal benefit of all Owners of the Bonds. The Town
shall not be liable for incidental, punitive, exemplary or consequential damages, or for lost profits,
whether direct or indirect. Acceleration shall not be a remedy upon the happening or continuance
of any Event of Default. Notwithstanding the foregoing provisions of this Section, nothing in this
Ordinance shall act as or be deemed to be a waiver by the Town of the Colorado Governmental
Immunity Act, Title 24, Article 10, C.R.S., as now or hereafter amended.
Section 1005. Receiver's Rights and Privileges. Any receiver appointed in any
proceedings to protect the rights of such Owners hereunder, the consent to any such appointment
being hereby expressly granted by the Town, may enter and may take possession of the System,
may operate and maintain the same, may prescribe fees, rates and other charges, and may collect,
receive and apply all Gross Revenues arising after the appointment of such receiver in the same
manner as the Town itself might do.
Section 1006. Rights and Privileges Cumulative. The failure of any Owner of
any Outstanding Bond to proceed in any manner herein provided shall not relieve the Town, or
any of its officers, agents or employees of any liability for failure to perform or carry out any duty,
obligation or other commitment. Each right or privilege of any such Owner (or trustee thereof) is
in addition and is cumulative to any other right or privilege, and the exercise of any right or
privilege by or on behalf of any Owner shall not be deemed a waiver of any other right or privilege
thereof.
Section 1007. Duties upon Defaults. Upon the happening of any Event of
Default, the Town shall do and perform all proper acts on behalf of and for the Owners of Bonds
to protect and to preserve the security created for the payment of the Bonds and to ensure the
payment of the Bond Requirements promptly as the same become due. While any Event of Default
35
exists, except to the extent it may be unlawful to do so, all Gross Revenues shall be paid into the
Bond Fund and into bond or similar funds established for any Parity Bonds then Outstanding, pro
rata based upon the aggregate principal amount of the Bonds and Parity Bonds then Outstanding.
If the Town fails or refuses to proceed as in this Section provided, the Owner or Owners of not
less than 25% in aggregate principal amount of the Bonds then Outstanding, after demand in
writing, may proceed to protect and to enforce the rights of the Owners of the Bonds as hereinabove
provided, and to that end any such Owners of the Outstanding Bonds shall be subrogated to all
rights of the Town under any agreement, lease or other contract involving the System or the Gross
Revenues entered into prior to the effective date of this Ordinance or thereafter while any of the
Bonds are Outstanding.
ARTICLE XI
AMENDMENT OF ORDINANCE
Section 1101. Privilege of Amendments.
A. Except as hereafter provided, this Ordinance may be amended or
supplemented by ordinances adopted by the Board in accordance with law, without receipt by the
Town of any additional consideration, but with the consent of the Owners of not less than a
majority of aggregate principal amount of the Bonds Outstanding (or such higher percentage if
required by a Parity Bond Ordinance) at the time of the adoption of such amendatory or
supplemental ordinance excluding, pursuant to Section 405 hereof, any Bonds which may then be
held or owned for the account of the Town. Notwithstanding the foregoing, no such ordinance
shall permit:
(1) Changing Payment. A change in the maturity, terms of redemption
or interest payment of any Outstanding Bond; or
(2) Reducing Return. A reduction in the principal amount of any Bond
or the rate of interest thereon, without the consent of the Owner of the Bond; or
(3) Prior Lien. The creation of a lien upon or a pledge of revenues
ranking prior, superior and senior to the lien or to the pledge created by this Ordinance; or
(4) Modifying Any Bond. A reduction of the principal amount or
percentages or otherwise affecting the description of Bonds the consent of the Owners of
which is required for any such modification or amendment; or
(5) Priorities Between Bonds The establishment of priorities as
between Bonds issued and Outstanding; or
(6) Modification of Less Than All the Bonds. The modification of or
otherwise affecting the rights of the Owners of less than all of the Outstanding Bonds.
B. Notwithstanding the foregoing provisions of this Section, this Ordinance
and the rights and obligations of the Town and of the Owners of the Bonds may also be modified
36
or amended at any time, without the consent of any Owners of the Bonds, but only to the extent
permitted by law and only for any or all of the following purposes:
(1) to add to the covenants and agreements of the Town contained in
this Ordinance other covenants and agreements thereafter to be observed;
(2) to subject to the covenants and agreements of the Town in this
Ordinance additional System revenues, to be defined and treated as Gross Revenues, for
the purpose of providing additional security for the Bonds and any Parity Bonds;
(3) to provide for the appointment of a new Paying Agent;
(4) to make such provisions for the purpose of curing any ambiguity or
of curing or correcting any formal defect or omission in this Ordinance, or in regard to
questions arising under this Ordinance, as the Town may deem necessary or desirable, and
which shall not adversely affect the interests of the Owners of the Bonds; or
(5) in order to preserve or protect the excludability from gross income
for federal income tax purposes of the interest allocable to the Bonds.
Section 1102. Notice of Amendment. Whenever the Board proposes to amend
or modify this Ordinance under the provisions of this Article, it shall cause notice of the proposed
amendment to be mailed to Owners of all Outstanding Bonds at their addresses as the same last
appear on the registration records maintained by the Paying Agent. Such notice shall briefly set
forth the nature of the proposed amendment and shall state that a copy of the proposed amendatory
ordinance is on file with the office of the Town Clerk for public inspection.
Section 1103. Time for Amendment. If the ordinance is required to be
consented to by the Owners of the Bonds, whenever at any time within one year from the date of
the giving of such notice there shall be filed with the office of the Town Clerk an instrument or
instruments executed by the Owners of at least a majority of aggregate principal amount of the
Bonds then Outstanding (or such higher percentage if required by a Parity Bond Ordinance), which
instrument or instruments shall refer to the proposed amendatory ordinance described in such
notice and shall specifically consent to and approve the adoption of such ordinance, the Board may
adopt such amendatory ordinance and such ordinance shall become effective. If the ordinance is
not required to be consented to by the Owners of the Bonds, the amendatory ordinance may be
adopted by the Board at any time.
Section 1104. Binding Consent to Amendment. If the Owners of not less than
a majority of aggregate principal amount of the Bonds then Outstanding at the time of the adoption
of such amendatory ordinance requiring consent of the Owners of the Bonds(or such higher
percentage if required by a Parity Bond Ordinance), or the predecessors in title of such Owners,
shall have consented to and approved the adoption thereof as herein provided, no Owner of any
Bond, whether or not such Owner shall have consented to or shall have revoked any consent as in
this Article provided, shall have any right or interest to object to the adoption of such amendatory
ordinance or to object to any of the terms or provisions therein contained or to the operation thereof
or to enjoin or restrain the Town from taking any action pursuant to the provisions thereof.
37
Section 1105. Time Consent Binding. Any consent given by the Owner of a
Bond pursuant to the provisions of this Article shall be irrevocable for a period of six months from
the date of the giving of the notice above provided for and shall be conclusive and binding upon
all future Owners of the same Bond during such period. Such consent may be revoked at any time
after six months from the date of such giving of such notice by the Owner who gave such consent
or by a successor in title by filing notice of such revocation with the Town Clerk, but such
revocation shall not be effective if the Owners of not less than a majority of aggregate principal
amount of the Bonds then Outstanding (or such higher percentage if required by a Parity Bond
Ordinance) as in this Article provided, prior to the attempted revocation, consented to and
approved the amendatory ordinance referred to in such revocation.
Section 1106. Unanimous Consent. Notwithstanding anything in the foregoing
provisions of this Article, the terms and provisions of this Ordinance or of any ordinance
amendatory thereof or supplemental thereto and the rights and the obligations of the Town and of
the Owners of the Bonds thereunder may be modified or amended in any respect upon the adoption
by the Town and upon the filing with the Town Clerk of an ordinance to that effect and with the
consent of the Owners of all the then Outstanding Bonds, such consent to be given as provided in
Section 1103 hereof; and no notice to Owners of Bonds shall be required as provided in Section
1102 hereof, nor shall the time of consent be limited except as may be provided in such consent.
Section 1107. Exclusion of Town's Bonds. At the time of any consent or of
other action taken under this Article, the Town shall furnish to the Town Clerk a certificate of the
Finance Director, upon which the Town may rely, describing all Bonds to be excluded for the
purpose of consent or of other action or of any calculation of Outstanding Bonds provided for in
this Article, and the Town shall not be entitled with respect to such Bonds to give any consent or
to take any other action provided for in this Article, as provided in Section 405 hereof.
Section 1108. Notation on Bonds. Bonds authenticated and delivered after the
effective date of any action taken as in this Article provided may bear a notation by endorsement
or otherwise in form approved by the Board as to such action; and after the approval of such
notation, then upon demand of the Owner of any Bond Outstanding and upon presentation of such
Person's Bond for that purpose at the principal office of the Paying Agent, suitable notation shall
be made on such Bond by the Paying Agent as to any such action. If the Board so determines, new
Bonds, so modified as in the opinion of the Board conform to such action, shall be prepared,
executed, authenticated and delivered; and upon demand of the Owner of any Bond then
Outstanding, shall be exchanged without cost to such Owner for Bonds then Outstanding upon
surrender of such Bonds.
Section 1109. Proof of Instruments and Bonds. The fact and date of execution
of any instrument under the provisions of this Article, the amount and number of the Bonds held
by any Person executing such instrument, and the date of such Person's holding the same may be
proved as provided by Section 1203 hereof.
ARTICLE XI1
MISCELLANEOUS
38
Section 1201. Defeasance. If, when the Bonds shall be paid in accordance with
their terms (or payment of the Bonds has been provided for in the manner set forth in the following
paragraph), together with all other sums payable hereunder, then this Ordinance and all rights
granted hereunder shall thereupon cease, terininate and become void and be discharged and
satisfied.
Payment of any Outstanding Bond shall prior to the maturity or Redemption
Date thereof be deemed to have been provided for within the meaning and with the effect expressed
in this Section if (a) in case said Bond is to be redeemed on any date prior to its maturity, the Town
shall have given to the Paying Agent in form satisfactory to it irrevocable instructions to give on a
date in accordance with the provisions of Section 404 hereof, notice of redemption of such Bond
on said Redemption Date, such notice to be given in accordance with the provisions of Section 404
hereof, (b) there shall have been deposited with the Paying Agent or other Trust Bank either
moneys in an amount which shall be sufficient, and/or Federal Securities which shall not contain
provisions permitting the redemption thereof at the option of the issuer, the principal of and the
interest on which when due, and without any reinvestment thereof, will provide moneys which,
together with the moneys, if any, deposited with or held by the Paying Agent or other Trust Bank
at the same time, shall be sufficient to pay when due the Bond Requirements due and to become
due on said Bond on and prior to the Redemption Date or maturity date thereof, as the case may
be, and (c) in the event said Bond is not by its terms subject to redemption within the next 60 days,
the Town shall have given the Paying Agent in form satisfactory to it irrevocable instructions to
give, as soon as practicable in the same manner as the notice of redemption is given pursuant to
Section 404 hereof, a notice to the Owner of such Bond that the deposit required by (b) above has
been made with the Paying Agent or other Trust Bank and that payment of said Bond has been
provided for in accordance with this Section and stating such maturity or Redemption Date upon
which moneys are to be available for the payment of the Bond Requirements of said Bond. Neither
such securities nor moneys deposited with the Paying Agent or other Trust Bank pursuant to this
Section or principal or interest payments on any such Federal Securities shall be withdrawn or
used for any purpose other than, and shall be held in trust for, the payment of the Bond
Requirements of said Bond; provided any cash received from such principal or interest payments
on such Federal Securities deposited with the Paying Agent or other Trust Bank, if not then needed
for such purpose, shall, to the extent practicable, be reinvested in securities of the type described
in (b) of this paragraph maturing at times and in amounts sufficient to pay when due the Bond
Requirements to become due on said Bond on or prior to such Redemption Date or maturity date
thereof, as the case may be. At such time as payment of a Bond has been provided for as aforesaid,
such Bond shall no longer be secured by or entitled to the benefits of this Ordinance, except for
the purpose of any payment from such moneys or securities deposited with the Paying Agent or
other Trust Bank.
In the event that any Bond is deemed to have been paid and defeased in
accordance with (b) of the preceding paragraph, then in connection therewith, the Town shall cause
to be delivered a verification report of an independent nationally recognized certified public
accountant. If a forward supply contract is employed in connection with the refunding, (1) such
verification report shall expressly state that the adequacy of the escrow to accomplish the refunding
relies solely on the initial escrowed investments and the maturing principal thereof and interest
income thereon and does not assume performance under or compliance with the forward supply
39
contract, and (2) the applicable escrow agreement shall provide that in the event of any discrepancy
or difference between the terms of the forward supply contract and the escrow agreement (or the
authorizing ordinance, if no separate escrow agreement is utilized), the terms of the escrow
agreement or authorizing ordinance, if applicable, shall be controlling.
The release of the obligations of the Town under this Section shall be without
prejudice to the right of the Paying Agent to be paid reasonable compensation for all services
rendered by it hereunder and all its reasonable expenses, charges and other disbursements incurred
on or about the administration of and performance of its powers and duties hereunder.
Upon compliance with the foregoing provisions of this Section with respect to
all Bonds then Outstanding, this Ordinance may be discharged in accordance with the provisions
of this Section but the liability of the Town in respect of the Bonds shall continue; provided that
the Owners thereof shall thereafter be entitled to payment only out of the moneys or Federal
Securities deposited with the Paying Agent or other Trust Bank as provided in this Section.
Section 1202. Delegated Powers. The officers and employees of the Town be,
and they hereby are, authorized and directed to take all action necessary or appropriate to effectuate
the provisions of this Ordinance, including, without limitation:
A. Final Certificates. the execution of such certificates and closing documents
as may be reasonably required by the Initial Purchaser or Bond Counsel;
B. Paving Agent Agreement. the execution and delivery of an agreement with
the Paying Agent necessary or desirable to evidence the acceptance by the Paying Agent of its
duties hereunder;
C. Term Sheet. the execution and delivery of any term sheet or agreement
required by the Initial Purchaser; and
D. Electronic Signatures. the use of electronic signatures to execute any of the
documents described in this Section 1202 or elsewhere in this Ordinance as authorized by Article
71.3 of Title 24, C.R.S., also known as the Uniform Electronic Transactions Act.
Section 1203. Evidence of Bond Owners. Any request, consent or other
instrument which this Ordinance may require or may permit to be signed and to be executed by
the Owners of any Bonds may be in one or more instruments of similar tenor and shall be signed
or shall be executed by each such Owner in person or by such Person's attorney appointed in
writing. Proof of the execution of any such instrument or of an instrument appointing any such
attorney, or the holding by any Person of the Bonds shall be sufficient for any purpose of this
Ordinance (except as otherwise herein expressly provided) if made in the following manner:
A. Proof of Execution. The fact and the date of the execution by any Owner
of any Bonds or such Person's attorney of such instrument may be established by a certificate,
which need not be acknowledged or verified, of an officer of a bank or trust company satisfactory
to the Town Manager or Finance Director or Town Clerk or of any notary public or other officer
authorized to take acknowledgments of deeds to be recorded in the state in which he or she purports
40
to act, that the individual signing such request or other instrument acknowledged to him or her the
execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such
notary public or other officer; the authority of the individual or individuals executing any such
instrument on behalf of a corporate Owner of any securities may be established without further
proof if such instrument is signed by an individual purporting to be the president or vice president
of such corporation with a corporate seal affixed and attested by an individual purporting to be its
secretary or an assistant secretary; and the authority of any Person or Persons executing any such
instrument in any fiduciary or representative capacity may be established without further proof if
such instrument is signed by a Person or Persons purporting to act in such fiduciary or
representative capacity; and
B. Proof of Holdings. The amount of Bonds held by any Person and the
numbers, date and other identification thereof, together with the date of such Person's holding the
Bonds, shall be proved by the registration records maintained by the Paying Agent.
Section 1204. Parties Interested Herein. Nothing in this Ordinance expressed
or implied is intended or shall be construed to confer upon, or to give to, any Person, other than
the Town, the Paying Agent, and the Owners of the Bonds, any right, remedy or claim under or by
reason of this Ordinance or any covenant, condition or stipulation hereof; and all the covenants,
stipulations, promises and agreements in this Ordinance contained by and on behalf of the Town
shall be for the sole and exclusive benefit of the Town, the Paying Agent, and the Owners of the
Bonds.
Section 1205. Notices. Except as otherwise may be provided in this Ordinance,
all notices, certificates, requests or other communications pursuant to this Ordinance shall be in
writing and shall be sufficiently given and shall be deemed given by personal delivery or when
mailed by first class mail, and either delivered or addressed as follows:
If to the Town at:
Town of Firestone, Colorado
9950 Park Avenue
Firestone, Colorado 80504
Attention: Finance Director
If to the Paying Agent at:
UMB Bank, n.a.
1670 Broadway
Denver, Colorado 80202
Attention: Corporate Trust and Escrow Services Department
Any of the foregoing Persons may, by notice given hereunder to each of the other Persons,
designate any further or different addresses to which subsequent notices, certificates, requests or
other communications shall be sent.
41
Section 1206. No Rating, CUSIP Numbers or Securities De osp itory. The
Bonds have not been, and are not expected to be, rated by a nationally recognized organization
which regularly rates such obligations, assigned CUSIP numbers, marketed pursuant to any
Official Statement, Offering Memorandum or any other disclosure documents, or registered
with or made eligible for registration with any securities depository, including but not limited
to The Depository Trust Company, New York, New York. At the request of the Initial
Purchaser, the Bonds may be assigned CUSIP numbers or made eligible for registration with
any securities depository, including but not limited to The Depository Trust Company, New
York, New York, and the Mayor, the Town Manager and the Finance Director are each
independently authorized to execute such additional agreements or certificates as may be
necessary in connection therewith.
Section 1207. Business Days. If the date for making any payment or the last
date for performance of any act or the exercising of any rights, as provided in this Ordinance, shall
not be a Business Day, such payment may be made or act performed or right exercised on the next
succeeding Business Day, with the same force and effect as if done on the nominal date provided
in this Ordinance, and no interest shall accrue for the period after such nominal date.
[Remainder of this page intentionally left blank.]
42
INTRODUCED, PASSED AND ADOPTED AT A REGULAR MEETING OF
THE BOARD OF TRUSTEES OF THE TOWN OF FIRESTONE THIS 9Tn DAY OF
NOVEMBER, 2022.
(SEAL)
ATTEST:
Acting Town Clerk
.w
TOWN OF FIRESTONE, COLORADO
Mayor
EXHIBIT A
(FORM OF BOND)
UNITED STATES OF AMERICA
STATE OF COLORADO COUNTY OF WELD
TOWN OF FIRESTONE, COLORADO
WATER ENTERPRISE REVENUE BOND
SERIES 2022
No. R-
INTEREST RATE MATURITY DATE DATED AS OF CUSIP
December 1, 20 [date of delivery]
REGISTERED OWNER: [INITIAL PURCHASER]
PRINCIPAL AMOUNT: DOLLARS
The Town of Firestone (the "Town"), in the County of Weld and State of Colorado
(the "State"), for value received, hereby promises to pay to the registered owner specified above,
or registered assigns, upon the presentation and surrender of this Bond, solely from the special
funds provided therefor, as hereinafter set forth, the principal amount set forth above on the
maturity date specified above (unless this Bond shall have been called for prior redemption, in
which case on the Redemption Date) and to pay solely from such special funds interest hereon at
the interest rate per annum specified above, payable semiannually on June 1 and December 1 in
each year, commencing on [June 1, 2023], until the principal amount is paid or payment has been
provided for, as described in an ordinance adopted by the Board of Trustees of the Town on
November 9, 2022 (the "Ordinance"), as supplemented by the Sale Certificate. This is one of an
authorized series of bonds issued under the Ordinance (the "Bonds"). The Bonds are all issued
under and equally and ratably secured by and entitled to the security of the Ordinance. To the
extent not defined herein, terms used in this Bond shall have the same meanings as set forth in the
Ordinance. This Bond bears interest, matures, is payable, is subject to redemption and is
transferable as provided in the Ordinance, as supplemented by the Sale Certificate.
Reference is made to the Ordinance and to all ordinances supplemental thereto,
with respect to the nature and extent of the security for the Bonds, the accounts, funds or revenues
pledged, rights, duties and obligations of the Town, the Paying Agent, the rights of the Owners of
the Bonds, the Events of Default and remedies, the circumstances under which any Bond is no
longer Outstanding, the issuance of additional bonds and the terms on which such additional bonds
secured by the Net Revenues may be issued, the ability to amend the Ordinance, and to all the
provisions of which the Owner hereof by the acceptance of this Bond assents.
A-1
THE BONDS ARE ISSUED PURSUANT TO AND IN FULL COMPLIANCE
WITH THE CONSTITUTION AND LAWS OF THE STATE OF COLORADO, AND
PURSUANT TO THE ORDINANCE. THE BONDS ARE SPECIAL, LIMITED
OBLIGATIONS OF THE TOWN, SECURED BY THE NET REVENUES. THE BONDS DO
NOT CONSTITUTE A GENERAL OBLIGATION DEBT OF THE TOWN, THE STATE OR
ANY POLITICAL SUBDIVISION THEREOF, AND NEITHER THE TOWN, THE STATE
NOR ANY OF THE POLITICAL SUBDIVISIONS THEREOF IS LIABLE THEREFOR,
NEITHER THE MEMBERS OF THE. BOARD OF TRUSTEES OF THE TOWN NOR ANY
PERSONS EXECUTING THIS BOND SHALL BE PERSONALLY LIABLE FOR THIS BOND.
It is certified, recited and warranted that all the requirements of law have been fully
complied with by the proper officers of the Town in the issuance of this Bond; that it is issued
pursuant to and in strict conformity with the Constitution of the State of Colorado, the laws of the
State of Colorado, and with the Ordinance and any ordinances supplemental thereto; and that this
Bond does not contravene any Constitutional or statutory limitation.
It is also certified, recited, and warranted that the Bonds of the series of which this
Bond is one are issued under the authority of Title 31, Article 35, Part 4; Title 37, Article 45.1;
and Title 11, Article 57, Part 2, C.R.S., and in full conformity therewith. It is the intention of the
Town, as expressed in the Ordinance, that pursuant to Section 11-57-210, C.R.S., such recital shall
be conclusive evidence of the validity and the regularity of the issuance of the Bonds after their
delivery for value; and pursuant to Section 31-35-413, C.R.S., such recital shall conclusively
impart full compliance with all the provisions of such statute and Bonds issued containing such
recital shall be incontestable for any cause whatsoever after their delivery for value.
This Bond shall not be valid or become obligatory for any purpose or be entitled to
any security or benefit under the Ordinance until the certificate of authentication hereon shall have
been duly executed by the Paying Agent.
A-2
IN WITNESS WHEREOF, the Town has caused this Bond to be signed and
executed in its name and upon its behalf with the manual or facsimile signature of its Mayor, has
caused the manual or facsimile of the seal of the Town to be affixed hereon and has caused this
Bond to be signed, executed and attested with the manual or facsimile signature of its Town Clerk,
all as of the date specified above.
(MANUAL OR FACSIMILE SEAL)
Attest:
(Manual or Facsimile Signature)
Town Clerk
(Manual or Facsimile Signature)
Mayor
A-3
(Form of Certificate of Authentication)
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds described in the within -mentioned Ordinance.
UMB BANK, N.A., as Paying Agent
Date of Authentication By:
and Registration: Authorized Signatory
(End of Form of Certificate of Authentication)
A-4
(Form of Assignment)
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
the within Bond and all rights thereunder, and hereby irrevocably
constitutes and appoints to transfer the within Bond on the records kept
for the registration thereof with full power of substitution in the premises.
Dated:
Signature Guaranteed:
Signature must be guaranteed by a member
of a Medallion Signature Program.
Address of Transferee:
Social Security or other tax
identification number of
transferee:
NOTICE: The signature to this assignment must
correspond with the name as it appears on
the face of the within Bond in every
particular, without alteration or
enlargement or any change whatever. The
signature must be guaranteed by an eligible
guarantor institution as defined in 17 CFR
§ 240.17 Ad- I5(a)(2).
(End of Form of Assignment)
(End of Form of Bond)
A-5
STATE OF COLOR -ADO )
COUNTY OF WELD ) SS.
TOWN OF FIRESTONE )
I, Miriam Luna Gonzalez, the Acting Town Clerk of the Town of Firestone,
Colorado, do hereby certify:
1. The foregoing pages are a true, correct and complete copy of the Ordinance
adopted by the Board of Trustees, constituting the governing board of the Town of Firestone (the
"Board of Trustees"), by vote had and taken at an open, regular meeting of the Board of Trustees
held on November 9, 2022, as recorded in the regular book of official records of the proceedings
of said Town of Firestone kept in my office.
2. The Ordinance was adopted at an open, regular meeting of the Board of
Trustees on November 9, 2022, by an affirmative vote of a majority of the members of the Board
of Trustees, as follows:
Name
"Yes"
"No"
Absent
Abstain
Drew Peterson, Mayor (only votes in the
event of a tie)
Frank A. Jimenez, Mayor Pro Tern
Don Conyac
Sean Doherty
Matt Holcomb
Douglas Sharp
David Whelan
I The members of the Board of Trustees were present at the meeting and
voted on the passage of such Ordinance as set forth above.
4. There are no bylaws, rules or regulations of the Board of Trustees which
might prohibit the adoption of said Ordinance.
5. Notice of the meeting of November 9, 2022, in the form attached hereto as
Exhibit A was not less than 24 hours prior to the meeting in accordance with law.
6. The Ordinance was published by title in the Longmont Times -Call, a
newspaper of general circulation in the Town, on November [_], 2022, together with a statement
that the complete text of the Ordinance is available at Town Hall and on the Town's official
website, and the affidavit of publication is attached hereto as Exhibit B.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of said
q
Town this 1 day of November, 2022.
TOWN OF FIRESTONE, COLORADO
- - 4JIk X-'�
Dre len Pe erson, Mayor
Acting Town Clerk
APPROVE AS TO
jF
PAL I
William VfrayaAi, TtU Attorney
EXHIBIT A
(Attach Notice of Meeting)
A-1
EXHIBIT B
(Affidavit of Publication)
B-1
66138303A