Ordinance 2015-38 ORDINANCE NUMBER 2015-38
AN ORDINANCE authori zing the issuance of General Obligation
Bonds (Alternate Revenue Source), Series 2015A of the United
City of Yorkville, Kendall County, Illinois, in an aggregate
principal amount of $5,575,000 for the purpose of financing the
costs of certain capital projects within the City, refinancing certain
outstanding obligations and paying for costs related thereto.
Adopted by the City Council on the 23rd
day of June, 2015.
C\338331.2
MINUTES of a regular public meeting of the City Council of the
United City of Yorkville, Kendall County, Illinois, held at City
Hall Council Chambers located at 800 Game Farm Road,
Yorkville, Illinois, at 7:00 P.M., on the 23rd day of June, 2015.
The Mayor called the meeting to order and directed the City Clerk to call the roll.
Upon the roll being called,the following Aldermen answered present:
Cow 1MO, KOT, M ibse-dew5K1? Ae1EbUS, FUNk44OU5r.4.
T�i'RULlS . -/�JC1
The following Aldermen were absent:
Alderman t 61 EF-4S _ presented and the City Clerk read in full an ordinance as
follows:
C\338331.2
TABLE OF CONTENTS
SECTION HEADING PAGE
PREAMBLES ..................................................................................................................................1
SECTION 1. DEFINITIONS.............................................................................................................3
SECTION 2. INCORPORATION OF PREAMBLES...............................................................................6
SECTION 3. DETERMINATION TO ISSUE BONDS............................................................................7
SECTION 4. BOND DETAILS .........................................................................................................7
SECTION 5. BOOK ENTRY PROVISIONS........................................................................................9
SECTION 6. EXECUTION;AUTHENTICATION ..............................................................................12
SECTION 7. OPTIONAL REDEMPTION .........................................................................................12
SECTION 8. REDEMPTION PROCEDURE ......................................................................................13
SECTION 9. REGISTRATION AND EXCHANGE OR TRANSFER OF BONDS;PERSONS
TREATED AS OWNERS.............................................................................................16
SECTION 10. FORM OF BOND.......................................................................................................18
SECTION 11. ALTERNATE BONDS;GENERAL OBLIGATIONS;TAX LEVY......................................22
SECTION 12, TAX ABATEMENT....................................................................................................24
SECTION 13. FILING WITH COUNTY CLERK AND CERTIFICATE OF REDUCTION OF TAXES ...........25
SECTION14. SALE OF BONDS......................................................................................................26
SECTION 15. ALTERNATE BOND FUND........................................................................................26
SECTION 16. USE OF PROCEEDS...................................................................................................27
SECTION 17. REIMBURSEMENT....................................................................................................29
SECTION 18. NOT PRIVATE ACTIVITY BONDS .............................................................................29
SECTION19. TAX COVENANTS....................................................................................................30
SECTION 20. BANK QUALIFIED BONDS........................................................................................31
SECTION 21. REGISTERED FORM .................................................................................................32
SECTION 22. COVENANTS OF THE CITY.......................................................................................32
SECTION 23. FURTHER TAX COVENANTS ....................................................................................34
SECTION 24. NONCOMPLIANCE WITH TAX COVENANTS..............................................................36
SECTION 25. OPINION OF COUNSEL EXCEPTION..........................................................................36
SECTION 26. RIGHTS AND DUTIES OF BOND REGISTRAR AND PAYING AGENT............................36
SECTION27. DEFEASANCE ..........................................................................................................37
SECTION 28. CONTINUING DISCLOSURE UNDERTAKING..............................................................37
SECTION 29. PUBLICATION OF ORDINANCE.................................................................................38
SECTION30. SUPERSEDER...........................................................................................................38
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0338331.2
ORDINANCE NUMBER 2015-38
AN ORDINANCE authori zing the issuance of General Obligation
Bonds (Alternate Revenue Source), Series 2015A of the United
City of Yorkville, Kendall County, Illinois, in an aggregate
principal amount of $5,575,000 for the purpose of financing the
costs of certain capital projects within the City, refinancing certain
outstanding obligations and paying for costs related thereto, and
providing for the levy and collection of a direct annual tax for the
payment of the principal of and interest on said bonds.
WHEREAS, the United City of Yorkville, Kendall County, Illinois (the "City"), is a
municipal corporation and body politic of the State of Illinois, duly created, organized and
existing under the Municipal Code of the State of Illinois (the "Municipal Code"), and having the
powers, objects and purposes provided by said Municipal Code; and
WHEREAS, the Mayor and the Council of the City (the "Corporate Authorities") have
determined that it is necessary to (i) finance the acquisition, construction, rehabilitation and
equipping of infrastructure improvements within the City, including, but not limited to, water
infrastructure improvements in the City's Countryside subdivision (the "Project"), (ii) current
refund all or a portion of the City's outstanding General Obligation Bonds (Alternate Revenue
Source), Series 2005 (the "Refunded Bonds" or "Refunding"), which were issued to finance
certain redevelopment project costs incurred in connection with the redevelopment of the US
Route 34 & IL Route 47 (Countryside Shopping Center) Tax Increment Financing
Redevelopment Project Area (the "Prior Project") and (iii) pay certain costs of issuance of the
Bonds (as such term is hereinafter defined), all for the benefit of the inhabitants of the City; and
WHEREAS, the estimated cost of the Project and the Refunding, including legal, financial,
bond discount, capitalized interest, if any, printing and publication costs, and other expenses
(collectively, the "Costs"), is $5,575,000, and there are insufficient funds on hand and lawfully
available to pay such costs; and
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WHEREAS, $5,575,000 of alternate bonds need to be issued at this time pursuant to the
Local Government Debt Reform Act, 30 ILCS 350/1 to 350/18 (the "Act"); and
WHEREAS, it is necessary for the best interests of the City that the Project and the
Refunding be completed, and in order to raise funds required for such purpose it will be
necessary for the City to borrow an aggregate principal amount of$5,575,000 and in evidence
thereof to issue alternate bonds, being general obligation bonds payable from (i) all collections
distributed by the State of Illinois to the City from Retailer's Occupation Taxes, Service
Occupation Taxes, Use Taxes and Service Use Taxes (collectively, the "Sales Taxes" or the
"Pledged Revenues"), and(ii) ad valorem taxes of the City for which its full faith and credit have
been irrevocably pledged, unlimited as to rate or amount (the "Pledged Taxes"), in an aggregate
principal amount of$5,575,000, all in accordance with the Act; and
WHEREAS, if the aforementioned revenue source is insufficient to pay the alternate bonds,
ad valorem property taxes upon all taxable property in the City without limitation as to rate or
amount are authorized to be extended to pay the principal of and interest on the alternate bonds;
and
WHEREAS, on the 14th day of May, 2015, an authorizing ordinance for an amount not to
exceed $6,250,000 (the "Authorizing Ordinance") related to the Project and the Refunding,
together with a notice in the statutory form, was published in the Kendall County Record, being a
newspaper of general circulation in the City, and an affidavit evidencing the publication of the
Authorizing Ordinance and said notice has heretofore been presented to the Corporate
Authorities and made a part of the permanent records of the Corporate Authorities; and
WHEREAS, more than thirty (30) days expired since the date of publication of the
Authorizing Ordinance and said notice, and no petition with the requisite number of valid
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signatures thereon was filed with the City Clerk requesting that the question of the issuance of
the alternate bonds be submitted to referendum; and
WHEREAS, on the 26th day of May, 2015, the Corporate Authorities held a public hearing
pursuant to the Bond Issuance Notification Act following notice published in the Kendall County
Record, on the 14th day of May, 2015; and
WHEREAS, the Project constitutes a lawful corporate purpose within the meaning of the
Act; and
WHEREAS, the Corporate Authorities hereby determine that the Pledged Revenues will
provide in each year an amount not less than 1.10 times debt service of the alternate bonds
proposed to be issued in accordance with the Act; and
WHEREAS, such determination is supported by the most recent audit of the City (the
"Audit"), which Audit has been presented previously to the Corporate Authorities and is on file
currently with the City Clerk; and
WHEREAS, the alternate bonds to be issued will be payable from the Pledged Revenues
and the Pledged Taxes, both as hereinafter defined; and
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE UNITED
CITY OF YORKVILLE, KENDALL COUNTY, ILLINOIS, AS FOLLOWS:
Section 1. Definitions. In addition to such other words and terms used and defined in
this Ordinance, the following words and terms used in this Ordinance shall have the following
meanings, unless, in either case, the context or use clearly indicates another or different meaning
is intended:
A. The following words and terms are defined as set forth.
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"Act" means, collectively, the Local Government Debt Reform Act (Section 350/1 et seq.
of Chapter 30 (and particularly Section 350/15 thereof) of the Illinois Compiled Statutes, as
supplemented and amended, and applicable laws in connection with all collections distributed by
the State of Illinois to the City from Retailer's Occupation Taxes, Service Occupation Taxes, Use
Taxes and Service Use Taxes, the Registered Bond Act, and the Bond Authorization Act.
"Additional Bonds" means any Alternate Bonds issued in the future in accordance with
the provisions of the Act on a parity with and sharing equally in the Pledged Revenues with the
Bonds.
"Alternate Bonds" means any Outstanding Bonds issued as alternate bonds under and
pursuant to the provisions of the Reform Act, and includes, expressly, the Bonds.
"Bond' or "Bonds" means one or more, as applicable, of the Bonds authorized to be
issued by this Ordinance.
"Bond Counsel"means Ice Miller LLP, Chicago, Illinois.
"Bond Fund" means the Bond Fund established and defined in Section 15 of this
Ordinance.
"Bond Moneys" means all moneys on deposit from time to time in the Bond Fund
including investment income earned in the Bond Fund.
"Bond RegistrarlPaying Agent"means Amalgamated Bank of Chicago, Chicago, Illinois.
"Bond Year" means each annual period of December 1 to the next December 1, for the
Bonds, subject to such lawful elections as the City may make.
"Business Day" means any day other than a day on which banks in the City of Chicago,
Illinois, are required or authorized to close.
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"Code" means the Internal Revenue Code of 1986, as amended, and includes related and
applicable Income Tax Regulations promulgated by the Treasury Department.
"Corporate Authorities"means the Mayor and the City Council.
"Depository" means The Depository Trust Company, a New York limited trust company,
its successors, or a successor depository qualified to clear securities under applicable state and
federal laws.
"Designated Officers" means the Mayor, Clerk, Finance Director or City Administrator
of the City, or their successors or assigns.
"Fiscal Year" means that twelve-calendar month period selected by the Corporate
Authorities as the Fiscal Year for the City, currently May 1 to April 30.
"Ordinance" means this Ordinance, numbered as set forth on the title page hereof, and
passed by the Corporate Authorities on the 23rd day of June, 2015.
"Outstanding" or "outstanding" when used with reference to the Bonds and any
Additional Bonds means such of those bonds which are outstanding and unpaid; provided,
however, such term shall not include Bonds or Additional Bonds (i) which have matured and for
which moneys are on deposit with proper paying agents or are otherwise sufficiently available to
pay all principal thereof and interest thereon or (ii) the provision for payment of which has been
made by the City by the deposit in an irrevocable trust or escrow of funds or direct, full faith and
credit obligations of the United States of America, the principal of and interest on which will be
sufficient to pay at maturity or as called for redemption all the principal of,redemption premium,
if any, and interest on such Bonds or Additional Bonds.
"Pledged Revenues"means Sales Taxes and such other funds legally available to the City
and appropriated therefor.
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"Pledged Taxes"means the Taxes authorized to be levied in Section 11 to secure and pay
the Bonds.
"Purchase Price" means the purchase price paid for the Bonds as hereinafter authorized,
to-wit, $5,575,000 being par, plus premium of$438,270.15 and less underwriter's discount of
$122,259.75, for a total of$5,891,010.40.
"Purchaser"means BOSC, Inc., a subsidiary of BOK Financial Corporation.
"Record Date" means the 15th day of the month next preceding of any regularly
scheduled interest payment date and the 15th day of the month next preceding of any interest
payment date occasioned by a redemption of Bonds on other than a regularly scheduled interest
payment date.
"Sales Taxes" shall have the meaning above in the recitals to this Ordinance.
"Stated Maturity"means with respect to any Bond or interest thereon the date specified in
such Bond as the fixed date on which the principal of such Bond or such interest is due and
payable, whether by maturity or otherwise.
"Tax-exempt" means, with reference to the Bonds, the status of interest paid and received
thereon as excludable from the gross income of the owners thereof for federal income tax
purposes except to the extent that such interest is taken into account in computing an adjustment
used in determining the federal alternative minimum tax for certain corporations.
B. Certain further words and terms used in various sections are defined therein.
Section 2. Incorporation of Preambles. The Corporate Authorities hereby find that
all of the recitals contained in the preambles to this Ordinance are true, correct and complete and
do incorporate them into this Ordinance by this reference.
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Section 3. Determination to Issue Bonds. It is necessary and in the best interests of
the City to undertake the Project, the Refunding and to pay all necessary costs thereof, to pay all
related costs and expenses incidental thereto, and to borrow money and issue the Bonds for such
purposes. It is hereby found and determined that such borrowing of money is for a proper public
purpose or purposes and is in the public interest, and is authorized pursuant to the Act; and these
findings and determinations shall be deemed conclusive.
Section 4. Bond Details. For the purpose of providing for the costs of the Project and
the Refunding, there shall be issued and sold the Bonds in the principal amount of$5,575,000.
The Bonds shall each be designated "General Obligation Bond (Alternate Revenue Source),
Series 2015A." The Bonds shall be dated date of closing (the "Dated Date"); and shall also bear
the date of authentication thereof. The Bonds shall be in fully registered book-entry form
(hereinafter "Book Entry Form"), shall be in denominations of $5,000 or integral multiples
thereof(but no single Bond shall represent principal maturing on more than one date), shall be
numbered consecutively in such fashion as shall be determined by the Bond Registrar, and shall
become due and payable (subject to prior redemption as hereinafter provided) on December 1 of
the years and in the amounts and bearing interest at the rates percent per annum as follows:
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YEAR AMOUNT($) RATE(%) PRICE(%)
2016 $100,000 4.000 104.436
2017 155,000 4.000 106.473
2018 160,000 4.000 108.076
2019 395,000 4.000 109.481
2020 405,000 4.000 110.182
2021 425,000 4.000 110.684
2022 440,000 4.000 110.783
2023 460,000 4.000 110.896
2024 475,000 4.000 110.724
2026 435,000 4.000 109.810
2028 470,000 4.000 107.714
2030 510,000 4.000 105.439
2032 550,000 4.000 103.440
2034 595,000 4.000 102.133
Those of the Bonds due on December 1 of the following years: 2026, 2028, 2030, 2032
and 2034 are Term Bonds under this Ordinance and are subject to mandatory redemption by
operation of the Bond Fund at a price of par and accrued interest, without premium, on
December 1 of the years and in the amounts as follows:
FOR THE TERM BONDS OF 2026
YEAR AMOUNT($)
2025 215,000
2026' 220,000
* Maturity
FOR THE TERM BONDS OF 2028
YEAR AMOUNT($)
2027 230,000
2028' 240,000
*Maturity
FOR THE TERM BONDS OF 2030
YEAR AMOUNT($)
2029 250,000
2030` 260,000
*Maturity
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FOR THE TERM BONDS OF 2032
YEAR AMOUNT($)
2031 270,000
2032 280,000
*Maturity
FOR THE TERM BONDS OF 2034
YEAR AMOUNT M
2033 290,000
2034# 305,000
* Maturity
Each Bond shall bear interest from the later of its Dated Date as herein provided or from
the most recent interest payment date to which interest has been paid or duly provided for, until
the principal amount of such Bond is paid or duly provided for, such interest (computed upon the
basis of a 360-day year of twelve 30-day months) being payable on June 1 and December 1 of
each year, commencing on June 1, 2016. The City will use cash on hand to cover debt service
through June 1, 2016. Interest on each Bond shall be paid by check or draft of the Paying Agent,
payable upon presentation thereof in lawful money of the United States of America,to the person
in whose name such Bond is registered at the close of business on the applicable Record Date,
and mailed to the registered owner of the Bond as shown in the Bond Registrar or at such other
address furnished in writing by such Registered Owner, or as otherwise may be agreed with the
Depository. The principal of the Bonds shall be payable in lawful money of the United States of
America upon presentation thereof at the office maintained for the purpose of the Paying Agent
or at successor Paying Agent and locality.
Section S. Book Entry Provisions. The Bonds shall be initially issued in the form of
a separate single fully registered Bond for each of the maturities of the Bonds. Upon initial
issuance, the ownership of each such Bond shall be registered in the Bond Register in the name
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of"Cede & Co.", or any successor thereto, as nominee of the Depository. All of the outstanding
Bonds from time to time shall be registered in the Bond Register in the name of Cede & Co., as
nominee of the Depository. The Finance Director, as representative of the City, is authorized to
execute and deliver on behalf of the City, and as such agent for the City, such letters to or
agreements with the Depository as shall be necessary to effectuate such book-entry system (any
such letter or agreement being referred to herein as the "Representation Letter"). Without
limiting the generality of the authority given with respect to entering into such Representation
Letter, it may contain provisions relating to (a)payment procedures, (b)transfers of the Bonds or
of beneficial interests therein, (c)redemption notices and procedures unique to the Depository,
(d)additional notices or communications, and (e) amendment from time to time to conform with
changing customs and practices with respect to securities industry transfer and payment
practices.
With respect to Bonds registered in the Bond Register in the name of Cede & Co., as
nominee of the Depository, none of the City, the Finance Director, the Paying Agent or the Bond
Registrar shall have any responsibility or obligation to any broker-dealer, bank or other financial
institution for which the Depository holds Bonds from time to time as securities depository (each
such broker-dealer, bank or other financial institution being referred to herein as a "Depository
Participant") or to any person on behalf of whom such a Depository Participant holds an interest
in the Bonds. Without limiting the meaning of the immediately preceding sentence, the City, the
Finance Director, the Paying Agent and the Bond Registrar shall have no responsibility or
obligation with respect to (a)the accuracy of the records of the Depository, Cede & Co., or any
Depository Participant with respect to any ownership interest in the Bonds, (b)the delivery to
any Depository Participant or any other person, other than a registered owner of a Bond as
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shown in the Bond Register, of any notice with respect to the Bonds, including any notice of
redemption, or (c)the payment to any Depository Participant or any other person, other than a
registered owner of a Bond as shown in the Bond Register, of any amount with respect to
principal of or interest on the Bonds. No person other than a registered owner of a Bond as
shown in the Bond Register shall receive a Bond certificate with respect to any Bond. Upon
delivery by the Depository to the Bond Registrar of written notice to the effect that the
Depository has determined to substitute a new nominee in place of Cede & Co., and subject to
the provisions hereof with respect to the payment of interest to the registered owners of Bonds at
the close of business on the applicable record date, the name "Cede & Co." in this Ordinance
shall refer to such new nominee of the Depository.
In the event that (a)the City determines that the Depository is incapable of discharging
its responsibilities described herein and in the Representation Letter, (b)the agreement among
the City, the Paying Agent and Bond Registrar, and the Depository evidenced by the
Representation Letter shall be terminated for any reason or(c)the City determines that it is in the
best interests of the City or of the beneficial owners of the Bonds that they be able to obtain
certificated Bonds, the City shall notify the Depository and the Depository shall notify the
Depository Participants of the availability of Bond certificates, and the Bonds shall no longer be
restricted to being registered in the Bond Register in the name of Cede & Co., as nominee of the
Depository. The City may determine that the Bonds shall be registered in the name of and
deposited with a successor depository operating a book-entry system, as may be acceptable to the
City, or such depository's agent or designee, but if the City does not select such alternate book-
entry system, then the Bonds shall be registered in whatever name or names registered owners of
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Bonds transferring or exchanging Bonds shall designate, in accordance with the provisions
hereof.
Section 6 Execution; Authentication. The Bonds shall be executed on behalf of the
City by the manual or duly authorized facsimile signature of its Mayor and attested by the
manual or duly authorized facsimile signature of its City Clerk, as they may determine, and shall
have impressed or imprinted thereon the corporate seal or facsimile thereof of the City. In case
any such officer whose signature shall appear on any Bond shall cease to be such officer before
the delivery of such Bond, such signature shall nevertheless be valid and sufficient for all
purposes, the same as if such officer had remained in office until delivery. All Bonds shall have
thereon a certificate of authentication, substantially in the form hereinafter set forth, duly
executed by the Bond Registrar as authenticating agent of the City and showing the date of
authentication. No Bond shall be valid or obligatory for any purpose or be entitled to any
security or benefit under this Ordinance unless and until such certificate of authentication shall
have been duly executed by the Bond Registrar by manual signature, and such certificate of
authentication upon any such Bond shall be conclusive evidence that such Bond has been
authenticated and delivered under this Ordinance.
Section 7. Optional Redemption. Bonds due December 1, 2016 through December 1,
2025, inclusive, are not subject to optional redemption. Bonds due December 1, 2026 through
December 1, 2034, inclusive, are callable in whole or in part on any date on or after December 1,
2025, at a price of par and accrued interest. If less than all the Bonds are called, they shall be
redeemed in such principal amounts and from such maturities as determined by the City and
within any maturity by lot.
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Section 8. Redemption Procedure. For a mandatory redemption, the Bond Registrar
shall proceed to redeem Bonds without any further order or direction from the City whatsoever.
For optional redemption, the City shall, at least thirty (30) days prior to the redemption date
(unless a shorter time period shall be satisfactory to the Bond Registrar), notify the Bond
Registrar of such redemption date and of the maturities and principal amounts of Bonds to be
redeemed. For purposes of any redemption of less than all of the Bonds of a single maturity, the
particular Bonds or portions of Bonds to be redeemed shall be selected by lot not more than sixty
(60) days prior to the redemption date by the Bond Registrar for the Bonds of such maturity by
such method of lottery as the Bond Registrar shall deem fair and appropriate;provided, that such
lottery shall provide for the selection for redemption of Bonds or portions thereof so that any
$5,000 Bond or $5,000 portion of a Bond shall be as likely to be called for redemption as any
other such $5,000 Bond or$5,000 portion.
The Bond Registrar shall promptly notify the City and the Paying Agent in writing of the
Bonds or portions of Bonds selected for redemption and, in the case of any Bond selected for
partial redemption,the principal amount thereof to be redeemed.
Unless waived by the registered owner of Bonds to be redeemed, official notice of any
such redemption shall be given by the Bond Registrar on behalf of the City by mailing the
redemption notice by first class mail not less than 30 days and not more than 60 days prior to the
date fixed for redemption to each registered owner of the Bond or Bonds to be redeemed at the
address shown on the Bond Register or at such other address as is furnished in writing by such
registered owner to the Bond Registrar.
All official notices of redemption shall include at least the information as follows:
(a) the redemption date;
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(b) the redemption price;
(c) if less than all of the outstanding Bonds of a particular maturity are to be
redeemed, the identification (and, in the case of partial redemption of Bonds within such
maturity,the respective principal amounts) of the Bonds to be redeemed;
(d) a statement that on the redemption date the redemption price will become
due and payable upon each such Bond or portion thereof called for redemption and that
interest thereon shall cease to accrue from and after said date; and
(e) the place where such Bonds are to be surrendered for payment of the
redemption price, which place of payment shall be the office maintained for the purpose
by the Paying Agent.
Such additional notice as may be agreed upon with the Depository shall also be given as
long as any Bonds are held by the Depository.
Prior to any redemption date, the City shall deposit with the Paying Agent an amount of
money sufficient to pay the redemption price of all the Bonds or portions of Bonds which are to
be redeemed on that date.
Official notice of redemption having been given as aforesaid, the Bonds or portions of
Bonds so to be redeemed shall, on the redemption date, become due and payable at the
redemption price therein specified, and from and after such date (unless the City shall default in
the payment of the redemption price), such Bonds or portions of Bonds shall cease to bear
interest. Neither the failure to mail such redemption notice, nor any defect in any notice so
mailed, to any particular registered owner of a Bond, shall affect the sufficiency of such notice
with respect to other registered owners. Notice having been properly given, failure of a
registered owner of a Bond to receive such notice shall not be deemed to invalidate, limit or
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delay the effect of the notice or redemption action described in the notice. Such notice may be
waived in writing by a registered owner of a Bond entitled to receive such notice, either before or
after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by
registered owners shall be filed with the Bond Registrar, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such waiver.
Upon surrender of such Bonds for redemption in accordance with said notice, such Bonds
shall be paid by the Paying Agent at the redemption price. The procedure for the payment of
interest due as part of the redemption price shall be as herein provided for payment of interest
otherwise due. Upon surrender for any partial redemption of any Bond, there shall be prepared
for the registered owner a new Bond or Bonds of like tenor, of authorized denominations, of the
same maturity, and bearing the same rate of interest in the amount of the unpaid principal.
If any Bond or portion of a Bond called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid or duly provided for, bear interest
from the redemption date at the rate borne by the Bond or portion of Bond so called for
redemption. All Bonds which have been redeemed shall be canceled and destroyed by the Bond
Registrar and shall not be reissued.
The City agrees to provide such additional notice of redemption as it may deem advisable
at such time as it determines to redeem Bonds, taking into account any requirements or guidance
of the Securities and Exchange Commission, the Municipal Securities Rulemaking Board, the
Government Accounting Standards Board, or any other federal or state agency having
jurisdiction or authority in such matters;provided, however, that such additional notice shall be
(1)advisory in nature, (2) solely in the discretion of the City, and (3)not be a condition
precedent of a valid redemption or a part of the Bond contract, and any failure or defect in such
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0338331.2
notice shall not delay or invalidate the redemption of Bonds for which proper official notice shall
have been given. Reference is also made to the provisions of the Continuing Disclosure
Undertaking of the City with respect to the Bonds, which may contain other provisions relating
to notice of redemption of Bonds.
Upon the payment of the redemption price of Bonds being redeemed, each check or other
transfer of funds issued for such purpose shall bear the CUSIP number identifying, by issue and
maturity, the Bonds being redeemed with the proceeds of such check or other transfer.
As part of their respective duties hereunder, the Bond Registrar and Paying Agent shall
prepare and forward to the City a statement as to notice given with respect to each redemption
together with copies of the notices as mailed and published.
Section 9. Registration and Exchange or Transfer of Bonds; Persons Treated as
Owners. The City shall cause the Bond Register to be kept at the office maintained for the
purpose by the Bond Registrar, which is hereby constituted and appointed the registrar of the
City for the Bonds. The City is authorized to prepare, and the Bond Registrar or such other agent
as the City may designate shall keep custody of, multiple Bond blanks executed by the City for
use in the transfer and exchange of Bonds.
Any Bond may be transferred or exchanged, but only in the manner, subject to the
limitations, and upon payment of the charges as set forth in this Ordinance. Upon surrender for
transfer or exchange of any Bond at the office maintained for the purpose by the Bond Registrar,
duly endorsed by or accompanied by a written instrument or instruments of transfer or exchange
in form satisfactory to the Bond Registrar and duly executed by the registered owner or an
attorney for such owner duly authorized in writing, the City shall execute and the Bond Registrar
shall authenticate, date and deliver in the name of the transferee or transferees or, in the case of
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an exchange, the registered owner, a new fully registered Bond or Bonds of like tenor, of the
same maturity, bearing the same interest rate, of authorized denominations, for a like aggregate
principal amount.
The Bond Registrar shall not be required to transfer or exchange any Bond during the
period from the close of business on the Record Date for an interest payment to the opening of
business on such interest payment date, nor to transfer or exchange any Bond after notice calling
such Bond for redemption has been mailed, nor during a period of fifteen (15) days next
preceding mailing of a notice of redemption of any Bonds.
The execution by the City of any fully registered Bond shall constitute full and due
authorization of such Bond, and the Bond Registrar shall thereby be authorized to authenticate,
date and deliver such Bond; provided, however, that the principal amount of Bonds of each
maturity authenticated by the Bond Registrar shall not at any one time exceed the authorized
principal amount of Bonds for such maturity less the amount of such Bonds which have been
paid.
The person in whose name any Bond shall be registered shall be deemed and regarded as
the absolute owner thereof for all purposes, and payment of the principal of or interest on any
Bond shall be made only to or upon the order of the registered owner thereof or his legal
representative. All such payments shall be valid and effectual to satisfy and discharge the
liability upon such Bond to the extent of the sum or sums so paid.
No service charge shall be made for any transfer or exchange of Bonds, but the City or
the Bond Registrar may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any transfer or exchange of Bonds
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0338331.2
except in the case of the exchange of a Bond for the unredeemed portion of a Bond or Bonds
surrendered for redemption.
Section 10. Form of Bond. The Bonds shall be in substantially the form hereinafter set
forth; provided, however, that if the text of the Bonds is to be printed in its entirety on the front
side of the Bonds, then the second paragraph on the front side and the legend "See Reverse Side
for Additional Provisions" shall be omitted and the text of paragraphs set forth for the reverse
side shall be inserted immediately after the first paragraph.
[FORM OF BOND-FRONT SIDE]
REGISTERED REGISTERED
No. $
UNITED STATES OF AMERICA
STATE OF ILLINOIS
COUNTY OF KENDALL
UNITED CITY OF YORKVILLE
GENERAL OBLIGATION BOND(ALTERNATE REVENUE SOURCE), SERIES 2015A
See Reverse Side for
Additional Provisions.
Interest Maturity Dated
Rate: Date: December 1, Date: July 8, 2015 CUSIP:
Registered Owner: CEDE&CO.
Principal Amount: Dollars
KNOW ALL PERSONS BY THESE PRESENTS that the United City of Yorkville, Kendall
County, Illinois, a municipality, non-home rule unit, and political subdivision of the State of
Illinois (the "City"), hereby acknowledges itself to owe and for value received promises to pay to
the Registered Owner identified above, or registered assigns as hereinafter provided, on the
Maturity Date identified above (subject to right of prior redemption as hereinafter stated), the
Principal Amount identified above and to pay interest (computed on the basis of a 360-day year
of twelve 30-day months) on such Principal Amount from the later of the Dated Date of this
Bond identified above or from the most recent interest payment date to which interest has been
paid or duly provided for, at the Interest Rate per annum identified above, such interest to be
payable on June 1 and December 1 of each year, commencing June 1, 2016, until said Principal
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0338331.2
Amount is paid or duly provided for. The City will use cash on hand to cover debt service
through June 1, 2016.
The principal of this Bond is payable in lawful money of the United States of America
upon presentation hereof at the corporate trust office of Amalgamated Bank of Chicago,
Chicago, Illinois (the "Paying Agent" or "Bond Registrar"). Payment of interest shall be made
to the Registered Owner hereof as shown on the registration books of the City maintained by
Bond Registrar at said location at the close of business on the applicable Record Date. Interest
shall be paid by check or draft of the Paying Agent, payable upon presentation in lawful money
of the United States of America, mailed to the address of such Registered Owner as it appears on
such registration books, or at such other address furnished in writing by such Registered Owner
to the Bond Registrar, or as otherwise agreed by the City and the Bond Registrar for so long as
this Bond is held by The Depository Trust Company, New York, New York, the Depository, or
nominee, in book-entry only form as provided for same.
Reference is hereby made to the further provisions of this Bond set forth on the reverse
hereof, and such further provisions shall for all purposes have the same effect as if set forth at
this place.
It is hereby certified and recited that all conditions, acts and things required by the
Constitution and Laws of the State of Illinois to exist or to be done precedent to and in the
issuance of this Bond, including the authorizing Act, have existed and have been properly done,
happened and been performed in regular and due form and time as required by law; that the
indebtedness of the City, represented by the Bonds, and including all other indebtedness of the
City, howsoever evidenced or incurred, does not exceed any constitutional or statutory or other
lawful limitation; and that provision has been made for the collection of a direct annual tax, in
addition to all other taxes, on all of the taxable property in the City sufficient to pay the interest
hereon as the same falls due and also to pay and discharge the principal hereof at maturity.
This Bond shall not be valid or become obligatory for any purpose until the certificate of
authentication hereon shall have been signed by the Bond Registrar.
[FORM OF BOND-REVERSE SIDE]
This bond is one of a series of bonds (the "Bonds") in the aggregate principal amount of
$5,575,000 issued by the City for the purpose of paying costs of the Project and the Refunding,
and of paying expenses incidental thereto, all as described and defined in the ordinance
authorizing the Bonds (the "Ordinance"), payable as to principal and interest from (i) all
collections distributed by the State of Illinois to the City from Retailer's Occupation Taxes,
Service Occupation Taxes, Use Taxes and Service Use Taxes (collectively, the "Sales Taxes" or
the "Pledged Revenues"), and (ii) ad valorem taxes of the City for which its full faith and credit
have been irrevocably pledged, unlimited as to rate or amount (the "Pledged Taxes"), all in
accordance with the provisions of the Local Government Debt Reform Act, as supplemented and
amended (the "Act"). The full faith, credit and resources of the City are pledged to the punctual
payment of the principal of and interest on the Bonds. This Bond is negotiable, subject to
registration provisions,pursuant to the laws of the State of Illinois.
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0338331.2
This Bond is subject to provisions relating to registration, transfer and exchange; and
such other terms and provisions relating to security and payment as are set forth in the
Ordinance, to which reference is hereby expressly made, and to all the terms of which the
Registered Owner hereof is hereby notified and shall be subject.
Bonds due December 1, 2016 through December 1, 2025, inclusive, are not subject to
optional redemption. Bonds due December 1, 2026 through December 1, 2034, inclusive, are
callable in whole or in part on any date on or after December 1, 2025, at a price of par and
accrued interest. If less than all the Bonds are called, they shall be redeemed in such principal
amounts and from such maturities as determined by the City and within any maturity by lot.
The City has designated the bonds as qualified tax-exempt obligations to qualify the
bonds for the $10,000,000 exception from the provisions of Section 265(b) of the Internal
Revenue Code of 1986 relating to the disallowance of 100%of the deduction for interest expense
allocable to tax-exempt obligations.
IN WITNESS WHEREOF the United City of Yorkville, Kendall County, Illinois has caused
this Bond to be executed by the manual or facsimile signature of the Mayor and the City Clerk,
the seal of said City (or a facsimile thereof) to be affixed, imprinted, engraved or otherwise
reproduced hereon and countersigned by the duly authorized manual or facsimile signature of the
Finance Director, all as of the Dated Date identified above.
UNITED CITY OF YORKVILLE, KENDALL
COUNTY, ILLINOIS
BY
Mayor
BY
City Clerk
[SEAL]
Countersigned:
BY
Finance Director
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C\338331.2
CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds described in the within-mentioned Ordinance and is one of
the General Obligation Bonds (Alternate Revenue Source), Series 2015A, having a Dated Date
of , 2015, of the United City of Yorkville, Kendall County, Illinois.
AMALGAMATED BANK OF CHICAGO, as
Registrar
By
Authorized Officer
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
Here insert Social Security Number, Employer
Identification Number or other Identifying
Number
(Name and Address of Assignee)
the within Bond and does hereby irrevocably constitute and appoint
as attorney to transfer the said Bond on the books kept for registration thereof with full power of
substitution in the premises.
Dated:
Signature guaranteed:
NOTICE: The signature to this transfer and assignment must correspond with the name of the
Registered Owner as it appears upon the face of the within Bond in every particular,
without alteration or enlargement or any change whatever.
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C\338331.2
Section 11. Alternate Bonds; General Obligations; Tax Levy. The Bonds are and
constitute Alternate Bonds under the Local Government Debt Reform Act, anticipated to be
payable from Pledged Revenues. Under and pursuant to Section 15 of the Local Government
Debt Reform Act, the full faith and credit of the City are hereby irrevocably pledged to the
punctual payment of the principal of,premium, if any, and interest on the Bonds; the Bonds shall
be direct and general obligations of the City; and the City shall be obligated to levy ad valorem
taxes upon all the taxable property within the City's corporate limits, for the payment of the
Bonds and the interest thereon, without limitation as to rate or amount (such ad valorem taxes
being the "Pledged Taxes").
Pledged Revenues are hereby determined by the Corporate Authorities to be sufficient to
provide for or pay in each year to final maturity of the Bonds all of the following: (1) the debt
service on all Outstanding revenue bonds payable from Pledged Revenues, (2) all amounts
required to meet any fund or account requirements with respect to such Outstanding revenue
bonds, (3) other contractual or tort liability obligations, if any, payable from such Pledged
Revenues, and (4) in each year, an amount not less than 1.10 times debt service of all (i)
Alternate Bonds payable from such Pledged Revenues previously issued and outstanding, and
(ii) Alternate Bonds payable from such Pledged Revenues proposed to be issued, including the
Bonds. The Pledged Revenues shall be and are hereby determined by the Corporate Authorities
to provide in each year an amount not less than 1.10 times debt service (as defined in Section 2
of the Local Government Debt Reform Act) of Alternate Bonds payable from such revenue
sources previously issued and outstandin g, and Alternate Bonds proposed to be issued. Such
conditions enumerated need not be met for that amount of debt service (as defined in Section 2
of the Local Government Debt Reform Act) provided for by the setting aside of proceeds of
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C\338331.2
bonds or other moneys at the time of the delivery of such bonds. The Pledged Revenues are
hereby determined by the Corporate Authorities to provide in each year all amounts required to
meet any fund or account requirements with respect to this resolution, any contractual or tort
liability obligations, if any, payable from Pledged Revenues, and an amount not less than 1.10
times debt service (as defined in Section 2 of the Local Government Debt Reform Act) of all of
the Outstanding Bonds, payable from such Pledged Revenues. The determination of the
sufficiency of the Pledged Revenues is expected to be supported by reference to the most recent
audit of the City, which audit is for a Fiscal Year ending not earlier than 18 months previous to
the time of issuance of the Bonds, and not otherwise a "report" under Section 15 of the Local
Government Debt Reform Act shall be prepared.
The Bonds are issued on a parity with respect to the Pledged Revenues with the City's
currently outstanding portion of the General Obligation (Alternate Revenue Source) Refunding
Bonds, Series 2014 and General Obligation(Alternate Revenue Source)Bonds, Series 2014A.
For the purpose of providing additional funds to produce the sums necessary to pay
interest on the Bonds as it falls due and pay and discharge the principal thereof at maturity, there
be and there is hereby levied upon all the taxable property within the City a direct annual tax for
each of the years while the Bonds or any of them are outstanding, in amounts sufficient for that
purpose, and that there be and there is hereby levied upon all of the taxable property in the City,
in addition to all other taxes, the following direct annual tax to be levied from 2015 (collectible
in 2016)through 2033 (collectible in 2034):
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C\338331.2
FOR THE A TAX SUFFICIENT TO PRODUCE THE DOLLAR
YEAR SUM OF:
2015 $321,000 for principal and interest
2016 $370,900 for principal and interest
2017 $369,600 for principal and interest
2018 $593,500 for principal and interest
2019 $587,500 for principal and interest
2020 $590,900 for principal and interest
2021 $588,600 for principal and interest
2022 $590,600 for principal and interest
2023 $586,900 for principal and interest
2024 $313,100 for principal and interest
2025 $309,400 for principal and interest
2026 $310,400 for principal and interest
2027 $311,000 for principal and interest
2028 $311,200 for principal and interest
2029 $311,000 for principal and interest
2030 $310,400 for principal and interest
2031 $309,400 for principal and interest
2032 $308,000 for principal and interest
2033 $311,100 for principal and interest
The City will use cash on hand to cover debt service through June 1, 2016.
The Pledged Revenues and other moneys on deposit in the Bond Fund shall be applied to
pay principal of and interest on the Bonds.
Interest or principal coming due at any time when there are insufficient funds on hand
from the Pledged Revenues to pay the same shall be paid promptly when due from current funds
on hand in advance of the collection of the Pledged Taxes herein levied; and when the Pledged
Revenues shall have been collected, reimbursement shall be made to said funds in the amount so
advanced.
Section 12. Tax Abatement. The City covenants and agrees with the Purchaser and
registered owners of the Bonds that so long as any of the Bonds remain outstanding, the City will
take no action or fail to take any action which in any way would adversely affect the ability of
the City to levy and collect the foregoing tax levy, unless and to the extent there then shall be
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C\338331.2
moneys irrevocably on deposit therefor in the applicable debt service account or accounts
established under Section 15 below and in accordance with this Section. The City and its
officers will comply with all present and future applicable laws in order to assure that the
Pledged Taxes may be levied, extended and collected as provided herein and deposited into the
Bond Fund.
In the event that funds from any lawful source may be made available for the purpose of
paying any principal of or interest on the Bonds so as to enable the abatement of the Pledged
Taxes, the Corporate Authorities shall, by proper proceedings, direct the deposit of such other
funds into the Bond Fund, and further shall direct the abatement of the Pledged Taxes by the
amount so deposited. A certified copy or other notification of any such proceedings abating
taxes may then be filed with the County Clerk in a timely manner to effect such abatement.
Section 13. Filing with County Clerk and Certificate of Reduction of Taxes. Promptly,
as soon as this Ordinance becomes effective, a copy hereof, certified by the City Clerk of the
City, shall be filed with the County Clerk; and said County Clerk shall in and for each of the
years 2015 to 2033, inclusive, ascertain the rate percent required to produce the aggregate
Pledged Taxes hereinbefore provided to be levied in each of said years and subject to abatement
as provided in said Section 12; and said County Clerk shall extend the same for collection on the
tax books in connection with other taxes levied in said years in and by the City for general
purposes of the City; and, subject to abatement as stated hereinabove, in said years such annual
tax shall be levied and collected by and for and on behalf of the City in like manner as taxes for
general purposes for said years are levied and collected, and in addition to and in excess of all
other taxes.
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C\338331.2
The Mayor, City Clerk and Finance Director be and the same are hereby directed to
Y � Y Y
and file with the Count Clerks a Certificate of Reduction of Taxes Heretofore Levied
prepare Y
showing the Refunded Bonds and directing the abatement of the taxes heretofore levied for the
f h funded Bonds.
a ment o the Re
payment
14. Sale of Bonds. The Bonds shall be executed as in this Ordinance provided
as soon after the passage hereof as may be, shall be deposited with the Bond Registrar, and shall
be delivered to the Purchaser upon the payment of the Purchase Price. The contract for the sale
of the Bonds to the Purchaser is hereby in all respects ratified, approved and confirmed, it being
hereby declared that no person holding any office of the City, either by election or appointment,
is in any manner financially interested, either directly in his own name or indirectly in the name
of any other person, association, trust or corporation, in such contract.
Upon the sale of the Bonds, the Designated Officers and any other officers of the City as
shall be appropriate, shall be and are hereby authorized and directed to approve or execute, or
both, such documents of sale of the Bonds as may be necessary, including, without limitation, a
Preliminary Official Statement, Official Statement, an Official Bid Form, and closing
documents.
The distribution of the Preliminary Official Statement relating to the Bonds presented
before this meeting and prepared by Speer Financial, Inc. on behalf of the City, is hereby in all
respects authorized and approved, and the proposed use by the Purchaser of an Official
Statement (in substantially the form of the Preliminary Official Statement but with appropriate
variations to reflect the final terms of the Bonds) is hereby approved.
Section 15. Alternate Bond Fund. There is hereby created or continued a special fund
of the City, which fund shall be held separate and apart from all other funds and accounts of the
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C\338331.2
City and shall be known as the "Alternate Bond Fund (Series 2015A Bonds)" (which may also
be referred to as the "Bond Fund"). The purpose of the Bond Fund is to provide a fund to receive
and disburse the Pledged Revenues for the Bonds and to receive and disburse Pledged Taxes for
any (or all) of the Bonds. All Pledged Revenues as required for the Bonds shall be deposited to
the credit of the Bond Fund, and all Pledged Taxes shall be deposited to the credit of the Bond
Fund. The Bond Fund and any respective accounts therein, constitute a trust fund established for
the purpose of carrying out the covenants, terms, and conditions imposed upon the City by this
Ordinance. The requisite amount of Pledged Revenues is to be received by the Finance Director
or such other designee of the City, as may be authorized, by the officers who collect or receive
the Pledged Revenues. The Finance Director or such other designee of the City, as may be
authorized, shall thereupon deposit the Pledged Revenues to the credit of the Bond Fund in such
amounts, taking into account the prior use of moneys in the Bond Fund, as shall provide for the
timely payment of all principal of and interest on the Bonds. Any Pledged Taxes which may be
received by the City shall promptly be deposited into the Bond Fund. Pledged Taxes on deposit
to the credit of the Bond Fund shall be fully spent to pay the principal of and interest on the
Bonds for which such taxes were levied and collected prior to use of any moneys on deposit
from Pledged Revenues.
Section 16 Use of Proceeds. The proceeds derived from the sale of the Bonds shall
be used as follows:
A. Accrued interest shall be deposited to the credit of the Bond Fund and applied to
pay first interest due on such Bonds.
B. A portion of the proceeds of the Bonds and any premium received on the delivery
of the Bonds, together with such funds of the City as may be necessary, shall be deposited into a
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C\338331.2
separate fund, hereby created, designated the "Cost of Issuance Fund"to be used to pay expenses
of issuance of Bonds. Disbursements from such fund shall be made from time to time upon the
direction of the Corporate Authorities. Any excess in said fund shall be used for the Project after
six months from the date of issuance of the Bonds.
C. A portion of the proceeds of the Bonds and any premium received on the delivery
of the Bonds, together with such funds of the City as may be necessary, shall be used to redeem
the Refunded Bonds on August 18, 2015, at the redemption price of par plus accrued interest to
the redemption date, and shall be deposited in trust with The Bank of New York Mellon Trust
Company, Chicago, Illinois, as paying agent for the Refunded Bonds, solely for the purpose of
paying the principal of and interest on the Refunded Bonds upon redemption on August 18,
2015. Such deposit shall result in the defeasance of the Refunded Bonds and the discharge of the
lien of the hereinafter defined Prior Bond Ordinance as of the date of issuance of the Bonds. In
accordance with the redemption provisions of the ordinance authorizing the issuance of the
Refunded Bonds (the "Prior Bond Ordinance"), the City does hereby make provision for the
payment of and does hereby call (subject only to the delivery of the Bonds) the Refunded Bonds
for redemption on August 18, 2015.
D. The remaining proceeds shall be set aside in separate funds hereby created or
continued and designated as the Project Fund(the "Project Fund"), which the City shall maintain
as a separate and segregated account. Moneys in the Project Fund shall be withdrawn from time
to time as needed for the payment of costs of the Project and paying the fees and expenses
incidental thereto. Moneys on deposit in the Project Fund may be invested by the Finance
Director of the City in any lawful manner. All investment earnings shall first be reserved and
transferred to such other account as and to the extent necessary to pay any "excess arbitrage
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C1338331.2
profits" or"penalty in lieu of rebate" under Code Section 148 to maintain the Tax-Exempt status
of the Bonds, and the remainder shall be retained in the Project Fund. Within sixty (60) days
after full depletion of the Project Fund, or if the Project has been fully completed and paid for,
the Finance Director of the City shall certify to the Corporate Authorities the fact of such
depletion or the City engineer shall certify to such completion and payment, and upon approval
of such certification by the Corporate Authorities, funds (if any) which remain shall be
transferred to the Bond Fund for expenditure to pay the Bonds on the then next interest and
principal payment date(s) until fully expended, and the portion of the Project Fund related to the
Project shall be closed.
Section 17. Reimbursement. None of the proceeds of the Bonds will be used to pay,
directly or indirectly, in whole or in part, for an expenditure that has been paid by the City prior
to the date hereof except architectural or engineering costs incurred prior to commencement of
any of the construction of the Project or expenditures for which an intent to reimburse it was
properly declared under Treasury Regulations Section 1.150-2. This Ordinance adopted by the
Corporate Authorities on June 23, 2015, is a declaration of official intent under Treasury
Regulations Section 1.150-2 as to all costs of the Project paid after the date hereof and prior to
issuance of the Bonds.
Section 18. Not Private Activity Bonds. None of the Bonds is a"private activity bona'
as defined in Section 141(a) of the Code. In support of such conclusion, the City certifies,
represents and covenants as follows:
A. No direct or indirect payments are to be made on any Bond with respect to any
private business use by any person other than a state or local governmental unit.
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C\338331.2
B. None of the proceeds of the Bonds is to be used, directly or indirectly, to make or
finance loans to persons other than a state or local governmental unit.
C. No user of the Project or the Prior Project, other than the City or another
governmental unit,will use the same on any basis other than the same basis as the general public;
and no person other than the City or another governmental unit will be a user of the Project or
the Prior Project as a result of(i) ownership or (ii) actual or beneficial use pursuant to a lease, a
management or incentive payment contract, or(iii) any other arrangement.
Section 19. Tax Covenants. In order to preserve the exclusion of interest on the
Bonds from gross income for federal tax purposes under Section 103 of the Internal Revenue
Code of 1986 as existing on the date of issuance of the Bonds (the"Code") and as an inducement
to purchasers of the Bonds,the City represents, covenants and agrees that:
A. No more than 10% of the payment of the principal of or interest on the Bonds will
be (under the terms of the Bonds, this ordinance or any underlying arrangement), directly or
indirectly, (i) secured by any interest in property used or to be used for a private business use or
payments in respect of such property or (ii) derived from payments (whether or not to the City)
in respect of such property or borrowed money used or to be used for a private business use.
B. No more than 5% of the Bond proceeds will be loaned to any entity or person
other than a state or local governmental unit. No more than 5% of the Bond proceeds will be
transferred, directly or indirectly, or deemed transferred to a nongovernmental person in any
manner that would in substance constitute a loan of the Bond proceeds.
C. The City reasonably expects, as of the date hereof, that the Bonds will not meet
either the private business use test described in paragraph (a) above or the private loan test
described in paragraph(b) above during the entire term of the Bonds.
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0338331.2
D. Neither the City nor the Corporate Authorities will take any action or fail to take
any action with respect to the Bonds that would result in the loss of the exclusion from gross
income for federal tax purposes on the Bonds pursuant to Section 103 of the Code, nor will the
City or the Corporate Authorities act in any other manner which would adversely affect such
exclusion.
E. It shall not be an event of default under this ordinance if the interest on any Bond
is not excludable from gross income for federal tax purposes or otherwise pursuant to any
provision of the Code which is not currently in effect and in existence on the date of issuance of
the Bonds.
F. These covenants are based solely on current law in effect and in existence of the
date of delivery of the Bonds.
Section 20. Bank Qualified Bonds. Pursuant to Section 265(b)(3) of the Internal
Revenue Code of 1986, as amended, the City as applicable at the time of sale and delivery of
Bonds shall designate such Bonds as "qualified tax-exempt obligations" as defined in Section
265(b)(3) of the Internal Revenue Code of 1986, as amended. The City by any such designation
represents that the reasonably anticipated amount of tax-exempt obligations that will be issued
by the City and all subordinate entities (of which there are none) of the City during the calendar
year in which the Bonds are issued will not exceed $10,000,000 within the meaning of or to be
taken into account under Section 265(b)(3) of the Internal Revenue Code of 1986, as amended.
The City by any such designation covenants that in that connection it will not so designate and
issue more than $10,000,000 aggregate principal amount of tax-exempt obligations in such
calendar year. For purposes of this Section, the term "tax-exempt obligations" includes
"qualified 501(c)(3) Bonds" (as defined in the Section 145 of the Internal Revenue Code of
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C\338331.2
1986, as amended)but does not include other"private activity bonds" (as defined in Section 141
of the Internal Revenue Code of 1986, as amended).
Section 21. Registered Form. The City recognizes that Section 149 of the Code
requires the Bonds to be issued and to remain in fully registered form in order to be and remain
Tax-exempt. In this connection, the City agrees that it will not take any action to permit the
Bonds to be issued in, or converted into, bearer or coupon form.
Section 22. Covenants of the City. Subject to the terms and provisions contained in
this section, and not otherwise, the City covenants and agrees so long as there are any
Outstanding Bonds(as defined herein), as follows:
(a) The City will take all action necessary either to impose, collect, apply or to
maintain the right to receive and apply the Pledged Revenues and Pledged Taxes in the manner
contemplated by this Ordinance, and such Pledged Revenues shall not be less than as shall be
required under Section 15 of the Local Government Debt Reform Act to maintain the Bonds as
Alternate Bonds.
(b) The City covenants that it will, while any of the Bonds shall remain outstanding,
ensure that the Pledged Revenues will be sufficient to provide for or pay each of the following in
any given year: (1) debt service on all Outstanding revenue bonds payable from such revenue
sources, (2) the debt service on all Outstanding revenue bonds payable from pledged revenue
sources, (3) all amounts required to meet any fund or account requirements with respect to such
Outstanding revenue bonds, (4)other contractual or tort liability obligations, if any, payable from
such pledged revenues, (5) other contractual or tort liability obligations, if any, payable from
such revenue sources, and (6) in each year, an amount not less than 1.10 times debt service of all
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C\338331.2
(i)alternate bonds payable from such revenue source previously issued and outstanding and
(ii) alternate bonds proposed to be issued (i.e. the Bonds).
(c) The determination of the sufficiency of the Pledged Revenues is expected to be
supported by reference to the most recent audit of the City, which audit is for a Fiscal Year
ending not earlier than 18 months previous to the time of issuance of the Bonds.
(d) The City will make and keep proper books and accounts (separate and apart from
all other records and accounts of the City), in which complete entries shall be made of all
transactions related to the Pledged Revenues, and covenants that within 210 days following the
close of each Fiscal Year, it will cause the books and accounts related to the Pledged Revenues
to be audited by independent certified public accountants. Such audit will be available for
inspection by the registered owners of any of the Bonds. Each such audit, in addition to
whatever matters may be thought proper by the accountants to be included therein, shall, without
limiting the generality of the foregoing, include the following:
(i) A balance sheet as of the end of such Fiscal Year, including a statement of
the amount held in each of the funds under this Ordinance.
(ii) The amount and details of all Outstanding bonds.
(iii) The accountant's comments, if any, regarding the manner in which the
City has carried out the accounting requirements of the Ordinance (including
as to the Alternate Bond status of the Bonds) and has complied with Section 15 of
the Local Government Debt Reform Act, and the accountant's recommendations
for any changes.
(e) The City will keep its books and accounts in accordance with generally accepted
accounting principles for local government entities and enterprise funds; provided, however, that
the credits to the Bond Fund shall be in cash, and such funds shall be held separate and apart in
cash and investments. For the purpose of determining whether sufficient cash and investments
are on deposit in such accounts under the terms and requirements of this Ordinance, investments
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shall be valued at market price on the valuation date thereof, which valuation date shall be not
less frequently than annually.
(f) The City will take no action in relation to the Pledged Revenues or the Pledged
Taxes which would unfavorably affect the security of the Bonds or the prompt payment of the
principal and interest thereon or the 110% coverage required in subsection (b) above to maintain
the Bonds as "alternate bonds"under Section 15 of the Local Government Debt Reform Act.
(g) The owner of any Bond may proceed by civil action to compel performance of all
duties required by law and this Ordinance.
Section 23. Further Tax Covenants. The City agrees to comply with all provisions of
the Code which, if not complied with by the City, would cause the Bonds not to be Tax-exempt.
In furtherance of the foregoing provisions, but without limiting their generality, the City agrees:
(a)through its officers, to make such further specific covenants, representations as shall be
truthful, and assurances as may be necessary or advisable; (b)to comply with all representations,
covenants and assurances contained in certificates or agreements as may be prepared by Bond
Counsel; (c)to consult with Bond Counsel and to comply with such advice as may be given;
(d)to file such forms, statements and supporting documents as may be required and in a timely
manner; and(e) if deemed necessary or advisable by its officers,to employ and pay fiscal agents,
financial advisors, attorneys and other persons to assist the City in such compliance.
The City further certifies and covenants as follows with respect to the requirements of
Section 148(f) of the Code, relating to the rebate of "excess arbitrage profits" (the "Rebate
Requirement")to the United States:
A. Unless an applicable exception to the Rebate Requirement is available to the City,
the City will meet the Rebate Requirement.
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B. Relating to applicable exceptions, the Finance Director or the Mayor is hereby
authorized to make such elections under the Code as either such officer shall deem reasonable
and in the best interests of the City. If such election may result in a"penalty in lieu of rebate" as
provided in the Code, and such penalty is incurred (the "Penalty"), then the City shall pay such
Penalty.
C. The Designated Officers shall cause to be established, at such time and in such
manner as they may deem necessary or appropriate hereunder, a "2015 General Obligation
Bonds Rebate or Penalty, if applicable Fund" (the "148 Compliance Fund") for the Bonds, and
such officers shall further, not less frequently than annually, cause to be transferred to the 148
Compliance Fund the amount determined to be the accrued liability under the Rebate
Requirement or Penalty. Said Designated Officers shall cause to be paid to the United States
Treasury, without further order or direction from the Corporate Authorities, from time to time as
required, amounts sufficient to meet the Rebate Requirement or to pay the Penalty.
D. Interest earnings in the Bond Fund are hereby authorized to be transferred,
without further order or direction from the Corporate Authorities, from time to time as required,
to the 148 Compliance Fund for the purposes herein provided; and proceeds of the Bonds and
other funds of the City are also hereby authorized to be used to meet the Rebate Requirement or
to pay the Penalty, but only if necessary after application of investment earnings as aforesaid and
only as appropriated by the Corporate Authorities.
The City also certifies and further covenants with the Purchaser and registered owners of
the Bonds from time to time outstanding that moneys on deposit in any fund or account in
connection with the Bonds, whether or not such moneys were derived from the proceeds of the
sale of the Bonds or from any other source, will not be used in a manner which will cause the
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Bonds to be "arbitrage bonds" within the meaning of Code Section 148 and any lawful
regulations promulgated thereunder, as the same presently exist or may from time to time
hereafter be amended, supplemented or revised.
Section 24. Noncompliance with Tax Covenants. Notwithstanding any other
provisions of this Ordinance, the covenants and authorizations contained in this Ordinance (the
"Tax Sections") which are designed to preserve the exclusion of interest on the Bonds from gross
income under federal law (the "Tax Exemption") need not be complied with if the City receives
an opinion of nationally recognized bond counsel that any Tax Section is unnecessary to preserve
the Tax Exemption.
Section 25. Opinion of Counsel Exception. The City reserves the right to use or invest
moneys in connection with the Bonds in any manner, notwithstanding the tax-related covenants
set forth in Sections 19 through 26 herein,provided it shall first have received an opinion from
Bond Counsel (or, in the event that Bond Counsel is unable or unwilling to provide such opinion,
then from another attorney or a firm of attorneys of nationally recognized standing as bond
counsel) to the effect that use or investment of such moneys as contemplated is valid and proper
under applicable law and this Ordinance and, further, will not adversely affect the Tax-exempt
status for the Bonds.
Section 26 Rights and Duties of Bond Registrar and Paying Agent. The Bond
Registrar and Paying Agent shall:
(a) act as bond registrar, paying agent, authenticating agent, and transfer agent
as provided herein;
(b) maintain a list of Bondholders as set forth herein;
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0338331.2
(c) cancel and/or destroy Bonds which have been paid at maturity or
submitted for exchange or transfer; and
(d) furnish the City at least annually an audit confirmation of Bonds paid,
Bonds outstanding and payments made with respect to interest on the Bonds.
Section 27. Defeasance. Any Bond or Bonds which (a) are paid and canceled,
(b)which have matured and for which sufficient sums been deposited with the Paying Agent to
pay all principal and interest due thereon, or (c) for which sufficient funds and Defeasance
Obligations have been deposited with the Paying Agent or similar institution having trust powers
to pay, taking into account investment earnings on such obligations, all principal of and interest
on such Bond or Bonds when due at maturity or as called for redemption, pursuant to an
irrevocable escrow or trust agreement, shall cease to have any lien on or right to receive or be
paid from the Pledged Taxes hereunder and shall no longer have the benefits of any covenant for
the registered owners of outstanding Bonds as set forth herein as such relates to lien and security
of the outstanding Bonds. All covenants relative to the payment, registration, transfer, and
exchange; are expressly continued for all Bonds whether outstanding Bonds or not. For purposes
of this section, "Defeasance Obligations"mean s (a) direct and general full faith and credit
obligations of the United States Treasury ("Directs"), (b) certificates of participation or trust
receipts in trusts comprised wholly of Directs or (c) other obligations unconditionally guaranteed
as to timely payment by the United States Treasury.
Section 28. Continuing Disclosure Undertaking. Any Designated Officer is hereby
authorized to execute and deliver the Continuing Disclosure Undertaking, in customary form as
previously executed by the City and as provided by Bond Counsel, to effect compliance with
Rule 15c2-12 adopted by the Securities and Exchange Commission under the Securities
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0338331.2
Exchange Act of 1934. When such Continuing Disclosure Undertaking is executed and
delivered on behalf of the City, it will be binding on the City and the officers, agents, and
employees of the City, and the same are hereby authorized and directed to do all such acts and
things and to execute all such documents as may be necessary to carry out and comply with the
provisions of such Continuing Disclosure Undertaking as executed and delivered.
Notwithstanding any other provisions hereof, the sole remedies for failure to comply with such
Continuing Disclosure Undertaking shall be the ability of the beneficial owner of any Bond to
seek mandamus or specific performance by court order, to cause to the City to comply with its
obligations thereunder.
Section 29. Publication of Ordinance. A full, true and complete copy of this
Ordinance shall be published within ten days after passage in pamphlet form by authority of the
Corporate Authorities.
Section 30. Superseder. All ordinances, resolutions and orders, or parts thereof, in
conflict herewith, are to the extent of such conflict hereby superseded; and this Ordinance shall
be in full force and effect immediately upon its passage and approval.
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ADOPTED: this 23rd day of June, 2015, pursuant to a roll call vote as follows:
AYES: M I I-SCO WsK 1, -rEE LIAI_ Kocif} Ko?', t RIEM jes,
'T,4KuLl s , COLO Si MO , AJX4 QU-<kR
NAYS:
ABSENT:
APPROVED by me this 23rd day of June, 2015
Published in pamphlet form by authority of the City Council on June 2015.
By:
ilez"
Its: Mayor, U City of Yorkville, Kendall
County, I i ois
ATTEST:
By:
zz
Its: City Clerk, United City of Yorkville
Kendall County, Illinois
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C\338331.2
Alderman R t E DE.2 s moved and Alderman I'o i seconded
the motion that said ordinance as presented and read by the City Clerk be adopted.
After a full discussion thereof, the Mayor directed that the roll be called for a vote upon
the motion to adopt said ordinance as read.
Upon the roll being called, the following Aldermen voted AYE:
M(LSCAF-145k(, TEE L1t4C-►� C44} 140-x, 19e1,E7>EP_S1
T-A?_ULts . CoL.0strno . -fi u)4K+ 0USEPI
and the following Aldermen voted NAY:
Whereupon the Mayor declared the motion carried and said ordinance adopted, approved
and signed the same in open meeting and directed the City Clerk to record the same in full in the
records of the Corporate Authorities of the United City of Yorkville, Kendall County, Illinois,
which was done.
Other business not pertinent to the adoption of said ordinance was duly transacted at said
meeting.
Upon motion duly made, seconded and carried,the meeting was adjourned.
City Cl Kr
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C\338331.2
STATE OF ILLINOIS )
) SS
COUNTY OF KENDALL )
CERTIFICATION OF MINUTES AND ORDINANCE
I, the undersigned, do hereby certify that I am the duly qualified and acting City Clerk of the
United City of Yorkville,Kendall County, Illinois(the"City"), and as such official I am the keeper of the
official journal of proceedings, books, records, minutes and files of the City and of the City Council (the
"Corporate Authorities")thereof.
I do further certify that the foregoing is a full, true and complete transcript of that portion of the
minutes of the meeting of the Corporate Authorities held on the 23rd day of June, 2015, insofar as the
same relates to the adoption of an ordinance entitled:
AN ORDINANCE authorizing the issuance of General Obligation Bonds
(Alternate Revenue Source), Series 2015A of the United City of
Yorkville, Kendall County, Illinois, in an aggregate principal amount of
$5,575,000 for the purpose of financing the costs of certain capital
projects within the City, refinancing certain outstanding obligations and
paying for costs related thereto, and for the levy of a direct annual tax
sufficient to pay the principal and interest on said bonds
a true, correct and complete copy of which said ordinance as adopted at said meeting appears in the
foregoing transcript of the minutes of said meeting.
I do further certify that the deliberations of the Corporate Authorities on the adoption of said
ordinance were taken openly; that the vote on the adoption of said ordinance was taken openly; that said
meeting was held at a specified time and place convenient to the public; that notice of said meeting was
duly given to all newspapers, radio or television stations and other news media requesting such notice;
that an agenda for said meeting was posted at the principal office of the Corporate Authorities and at the
location where said meeting was to be held on a day which was not a Saturday, Sunday or legal holiday
for Illinois municipalities and at least 48 hours in advance of holding said meeting; that said agenda
described or made specific reference to said ordinance; that a true, correct and complete copy of said
agenda as so posted is attached hereto; and that said meeting was called and held in strict compliance with
the provisions of the Open Meetings Act of the State of Illinois, as amended, and the Illinois Municipal
Code, as amended, and that the Corporate Authorities has complied with all of the provisions of said Act
and said Code, except as said Act and said Code are validly superseded by the home rule powers of the
City,and with all of the procedural rules of the Corporate Authorities in the adoption of said ordinance.
IN WITNESS WHEREOF I hereunto affix my official signature and the seal of the City this 23rd day
of June,2015.
[SEAL] City Clerk
01338331.2
STATE OF ILLINOIS )
SS
COUNTY OF KENDALL )
FILING CERTIFICATE
I,the undersigned, do hereby certify that I am the duly qualified and acting County Clerk
of Kendall County, Illinois, and as such official I do further certify that on the / 0( day of July,
2015,there was filed in my office a duly certified copy of Ordinance No. 2015-38 entitled:
AN ORDINANCE authori zing the issuance of General Obligation
Bonds (Alternate Revenue Source), Series 2015A of the United
City of Yorkville, Kendall County, Illinois, in an aggregate
principal amount of$5,575,000 for the purpose of financing the
costs of certain capital projects within the City,refinancing certain
outstanding obligations and paying for costs related thereto and
for the levy of a direct annual tax sufficient to pay the principal
and interest on said bonds
duly adopted by the Mayor and City Council of the United City of Yorkville, Kendall County,
Illinois, on 23rd day of June, 2015, and that the same has been deposited in the official files and
records of my office.
IN WITNESS WHEREOF, I hereunto affix my official signature and the seal of said
County,this 94 day July, 2015.
County Clerk of Kendall County, Illinois
(SEAL)