The Franklin Sun: Public Notices: Tuesday, October 14th, 2008



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Public Notices: Tuesday, October 14th, 2008

Public & Legal Notices may be submitted to us at legals@franklinsun.com.

Public Notices Published Tuesday, October 14th, 2008

(continued from #4)
SECTION 7. The Bonds shall be signed by the Mayor of the Issuer for, on behalf of, in the name of and under the corporate seal of the Issuer and attested by the Clerk of the Issuer.
SECTION 8. Subject to the prior payment of the reasonable and necessary expenses of operating and maintaining the System and making such payments as required by the outstanding Prior Lien Bonds, the Bond shall be secured and payable in principal and interest exclusively by a pledge of the income and revenues derived or to be derived from the operation of the System, as now existing and as constructed, acquired, extended and improved with the proceeds of the Bond or as the System shall hereafter be improved, extended or supplemented from any source whatsoever while the Bond remains outstanding, including, specifically, all properties of every nature owned by the Issuer and used or useful in the operation of the System, including real estate, personal and intangible properties, contracts, franchises, leases and choses in action. The said income and revenues are hereby irrevocably and irrepealably pledged in an amount sufficient for the payment of the Bond in principal and interest as they shall respectively mature, and the income and revenues thus pledged shall remain so pledged for the security of the Bond in principal and interest until they shall have been fully paid and discharged.
SECTION 9. The Issuer recognizes that the owner of the Prior Lien Bonds has certain contractual rights with respect to the income and revenues derived from the operation of the System. Nothing in this ordinance shall be construed in such a manner as to impair any rights vested in the Prior Lien Bonds and, if at any time it shall be established that any provisions of this ordinance are in conflict with the provisions of the resolutions authorizing the issuance of the Prior Bonds (the “Prior Bond Resolutions”), the provisions of the Prior Bond Resolutions shall be controlling over this ordinance to the extent of such conflict.
SECTION 10. The Issuer, through its Governing Authority, covenants to fix, establish and maintain such rates and collect such fees, rents or other charges for the services and facilities of the System, and all parts thereof, and to revise the same from time to time whenever necessary, as will always provide revenues in each year sufficient to pay (i) the reasonable and necessary expenses of operating and maintaining the System in each year, (ii) the principal and interest maturing on the Prior Lien Bonds to the extent payable from the System and the Bond in each year, (iii) all reserves or sinking funds or other payments required for such year by the Prior Bond Resolutions and this ordinance, and (iv) all other obligations or indebtedness payable out of the revenues of the System for such year, and which will provide revenues in each year, after paying all reasonable and necessary expenses of operating and maintaining the System in such year, at least equal to 110% of the largest amount of principal and interest maturing on the Bond, the Prior Lien Bonds and any additional pari passu additional bonds hereinafter issued as provided herein in any future fiscal year and on any pari passu additional bonds hereafter issued as provided herein. The Issuer further covenants:
That after payments have been made from the income and revenues of the System as necessary to satisfy the Issuer’s obligations under the Prior Bond Resolutions (such payments being required only so long as the Prior Lien Bonds remain outstanding) all of the remaining income and revenues derived or to be derived by the Issuer from the operation of the System shall be deposited as the same may be collected in a separate and special bank account to be established with the regularly designated fiscal agent bank of the Issuer, to be known and designated as the “Water Revenue Fund”, and said Fund shall be established, maintained and administered in the following order of priority and for the following express purposes:
(a) The payment of, first, all reasonable and necessary expenses of operating and maintaining the System which have not been previously paid under the terms of the Prior Bond Resolutions.
(b) The establishment and maintenance of the “2008 Water Revenue Bond and Principal and Interest Sinking Fund” (the “Sinking Fund”) sufficient in amount to pay promptly and fully the principal of and the interest on the Bonds by transferring from the Water Revenue Fund to the regularly designated fiscal agent bank of the Issuer (or such other bank designated by the Issuer with the approval of the Government), monthly in advance on or before the 20th day of each month of each year a sum equal to the total amount of principal and interest falling due on the next principal and interest payment date (except with regard to the Bond during the first year it is outstanding, a sum equal to 1/12th of the interest falling due on the interest only payment shall be deposited monthly into the Sinking Fund), together with such additional proportionate sum as may be required to pay said principal and interest as the same respectively become due; provided, however, that to the extent that proceeds of the Bond are expended to pay interest on the Bond during construction of the Project, then such transfers from the Water Revenue Fund to the Sinking Fund will be correspondingly redeemed. If pari passu bonds are hereafter issued by the Issuer in the manner provided in this ordinance, moneys in the Sinking Fund shall be equally available to pay principal and interest on such pari passu bonds, and payments into the Sinking Fund shall be increased as provided in the ordinance authorizing the issuance of such pari passu bonds. Said fiscal agent bank shall transfer from the Sinking Fund to any paying agent (if a paying agent other than said fiscal agent bank has been designated by the Issuer with the approval of the Government) or pay directly to the registered owner, for all bonds payable from the said Sinking Fund, at least three (3) days in advance of the date on which each payment of principal or interest falls due, funds fully sufficient to pay promptly the principal and/or interest so falling due on such date; provided, however, if payment is made by electronic debit, then such debit may be made no later than 11:00 a.m. on the date such payment is due.
(c) The establishment and maintenance of the “2008 Water Revenue Bond Reserve Fund” (the “Reserve Fund”) by transferring from said Water Revenue Fund to the regularly designated fiscal agent bank of the Issuer (or such other bank designated by the Issuer with the approval of the Government), monthly in advance on or before the 20th day of each month of each year, commencing with the month following completion of and acceptance of the Project, a sum at least equal to five percent (5%) of the amount to be paid into the Sinking Fund provided for in paragraph (b) above, the payments into the Reserve Fund to continue until such time as there has been accumulated in the Reserve Fund a sum equal to the highest principal and interest falling due in any year on the Bonds (the “Debt Service Requirement”), the money in the Reserve Fund to be retained solely for the purpose of paying the principal of and interest on bonds payable from the Sinking Fund as to which there would otherwise be default. In the event that additional pari passu bonds are issued hereafter in the manner provided by this ordinance, the payments into the Reserve Fund shall continue, or if the said payments have ceased because of the accumulation of the maximum amount provided above, then such payments shall be resumed, until such time as there has been accumulated in the Reserve Fund an amount of money equal to the highest combined principal and interest requirements for any succeeding twelve (12) months period on such bonds payable from the Sinking Fund.
(d) The establishment and maintenance of the “2008 Water Depreciation and Contingencies Fund” (the “Contingencies Fund”) to care for depreciation, extensions, additions, improvements and replacements necessary to operate properly the System, by transferring from the Water Revenue Fund to the regularly designated fiscal agent bank of the Issuer (or such other bank designated by the Issuer with the approval of the Government), monthly in advance on or before the 20th day of each month of each year commencing with the month following completion of and acceptance of the Project, a sum of at least equal to five percent (5%) of the amount to be paid into the Sinking Fund. Once a sum equal to the Debt Service Requirement has been accumulated in the Water Revenue Fund, the monthly payments into the Contingencies Fund shall increase to an amount equal to 10% of the sum being paid monthly into the Sinking Fund, the payments to continue over the life of the Bond. Money in the Contingencies Fund shall also be used to pay the principal of and the interest on any bond for the payment of which there is not sufficient money in the Sinking Fund or the Reserve Fund, but if so used, such money shall be replaced by the Issuer as soon as possible thereafter out of the earnings of the System after making the required payments into the respective funds and accounts hereinabove set out.
(e) The establishment and maintenance of the (2008 Waterworks System Short-Lived Assets Depreciation Fund( (the (Short-Lived Asset Fund() to provide for the maintenance and replacement of short lived assets of the System, by transferring from the Water Revenue Fund to the regularly designated fiscal agent bank designated by the Issuer with the approval of the Government), monthly in advance on or before the 20th day of each month of each year, commencing with the month following completion of an acceptance of the improvements and extensions financed with the proceeds of the Bonds, a sum of $377 until $156,855 is on deposit therein. Should the moneys in said Short-Lived Asset Fund fall below $156,855, monthly payments of $377 each shall recommence.
Subject to the foregoing, which are cumulative, the balance of the excess funds on deposit in the Water Revenue Fund may be used by the Issuer for the purpose of calling and/or paying bonds payable from the income and revenues of the System or for such other lawful corporate purposes as this Governing Authority may determine, whether or not such purposes are or are not related to the System.
If at any time it shall be necessary to use moneys in the Reserve Fund and/or the Contingencies Fund for the purpose of paying principal of or interest on bonds payable from the Sinking Fund as to which there would otherwise be default, then the moneys so used shall be replaced from the revenues first thereafter received, not hereinabove required to be used for operation and maintenance or for current principal and interest requirements, it being the intention hereof that there shall as nearly as possible be at all times in the Reserve Fund and in the Contingencies Fund the maximum amounts hereinabove specified.
All or any part of the moneys in any of the aforesaid funds and accounts described in subparagraphs (b), (c) (d) and (e) shall, at the written request of the Issuer, be invested in direct obligations of the United States of America or other obligations permitted by Louisiana law, maturing in five (5) years or less, in which event all income derived from investments in the said funds and accounts shall be deposited in the Water Revenue Fund as income and revenues of the System, except until the Reserve Fund and the Short-Lived Asset Fund have been fully funded, such investment earnings shall be retained in respective Funds and for the provided such investments shall, to the extent at any time necessary, be liquidated and the proceeds thereof applied to the purposes for which said respective funds and accounts are herein maintained.
SECTION 11. The Issuer may alter, amend or repeal from time to time any resolutions or ordinances establishing a schedule of rates and charges for the services and facilities to be rendered by the System, said alterations, amendments or repeals to be conditioned upon the preservation of the rights of the registered owner of the Bond with respect to the income and revenues of the System, not alone for the payment of the principal of and the interest on the Bond, but to insure that the income and revenues of the System shall be sufficient at all times to fulfill the other provisions specified in Section 10 hereof. The Issuer shall fix and maintain rates and collect charges for all services and facilities to be rendered by the System, irrespective of the user thereof, and no free services or facilities shall be furnished to any person, association of persons, or corporation, public or private, or even to the Issuer itself, and no discrimination shall be made as to rates and charges for the services and facilities of the System as between users of the same type or class.
The Issuer further agrees that the failure of any individual, partnership or corporation to pay said charge for any service rendered by the System within fifteen (15) days of the date on which it is due shall cause such charge to become delinquent; that if such delinquent charge, with interest and penalties accrued thereon, is not paid within ten (10) days from the date on which it became delinquent, the Issuer will cause to be shut off service to the affected premises; and that the Issuer and this Governing Authority and its officials, agents and employees will do all things necessary and will take advantage of all remedies afforded by law to collect and enforce the prompt payment of all charges made for services rendered by the System. All delinquent charges for service shall on the date of delinquency have added thereto a penalty of ten percent (10%) of the amount of the charge, and the amount so due, including the penalty charge, shall, after ten (10) days from the date of delinquency, bear interest at a reasonable rate to be established by this Governing Authority, which rate shall not be less than six per centum (6%) per annum. If services are discontinued as above provided, the customer shall, in addition to paying the delinquent charges, penalties and interest, pay as a condition precedent to the resumption of service a reasonable reconnection charge.
The Issuer shall place in effect, a schedule of water rates sufficient to allow it to meet the requirements set forth in Section 10 hereof, and neither such schedule nor any subsequent schedule shall be reduced at any time unless the maximum debt service reserve provided for in this ordinance has been accumulated as specified in Section 10 hereof and all payments required for all funds by this ordinance, including any deficiencies for prior payments, have been fully made, and unless such schedules as so reduced will in each year thereafter produce sufficient revenues to meet and fulfill the other provisions stated and specified in Section 10 of this ordinance.
SECTION 12. The registered owner of the Bond shall be entitled to exercise all rights for which provision is made in the laws of the State of Louisiana. Any owner of Bonds or any trustee acting for such owner in the manner hereinafter provided, may, either at law or in equity, by suit, action, mandamus or other proceeding in any court of competent jurisdiction, protect and enforce any and all rights under the laws of the State of Louisiana, or granted in this ordinance, and may compel the performance of all duties required by this ordinance or by any applicable statutes to be performed by the Issuer or by any agency, board or officer thereof, including the fixing, charging and collecting of rentals, fees or other charges for use of the System, and in general to take any action necessary to protect the rights of said registered owner.
In the event that default shall be made in the payment of the interest on or principal of any of the Bonds issued pursuant to this ordinance as the same shall become due, or in the making of the payments into any fund established by Section 10 of this ordinance or in the event that the Issuer or any agency, board, officer, agent or employee thereof shall fail or refuse to comply with the provisions of this ordinance, or shall default in any covenant for a period of thirty (30) days after written notice thereof, any owner of Bonds or any trustee appointed to represent registered owner as hereinafter provided, shall be entitled as of right to the appointment of a receiver of the System, as defined herein, in an appropriate judicial proceeding in a court of competent jurisdiction.
The receiver so appointed shall forthwith enter into and take possession of the System and shall hold, operate and maintain, manage and control the System, and in the name of the Issuer shall exercise all rights and powers of the Issuer with respect to the System. Such receiver shall collect and receive all fees, rentals and other revenues, maintain and operate the System in the manner provided in this ordinance, and comply under the jurisdiction of the court appointing such receiver with all of the provisions of this ordinance.
Whenever all that is due upon the Bonds and interest thereon, and under any covenants of this ordinance for reserve, sinking or other funds, and upon any other obligations and interest thereon, having a charge, lien or encumbrance upon the fees, rentals or other revenues of the System, shall have been paid and made good, and all defaults under the provisions of this ordinance shall have been cured and made good, possession of the System shall be surrendered to the Issuer upon the entry of an order of the court to that effect. Upon any subsequent default, any owner of the Bonds, or any trustee appointed for registered owner as hereinafter provided, shall have the same right to secure the further appointment of a receiver upon any such subsequent default. Such receiver shall in the performance of the powers hereinabove conferred upon him be under the direction and supervision of the court making such appointment, shall at all times be subject to the orders of such court and may be removed thereby and a successor appointed in the discretion of such court. Nothing herein contained shall limit the jurisdiction of such court to enter such other and further orders as such court may deem necessary for the exercise by the receiver of any function not specifically set forth herein.
Any receiver appointed as provided herein shall hold and operate the System in the name of the Issuer and for the joint protection and benefit of the Issuer and the registered owner of the Bond. Such receiver shall have no power to sell, assign, mortgage or otherwise dispose of any assets belonging or pertaining to the System but the authority of such receiver shall be limited to the possession, operation and maintenance of the System for the sole purpose of the protection of both the Issuer and registered owner, and the curing and making good of any default under the provisions of this ordinance, and the title to the System shall remain in the Issuer, and no court shall have any jurisdiction to enter any order permitting or requiring such receiver to sell, mortgage or otherwise dispose of any assets of the System except with the consent of the Issuer and in such manner as the court shall direct. The registered owner of the Bond may by duly executed certificate in writing appoint a trustee with authority to represent such registered owner in any legal proceedings for the enforcement of the rights of such registered owner. Such certificate shall be executed by such registered owner, or by his duly authorized attorney or representative, and shall be filed in the office of the Clerk of the Issuer.
Until an event of default shall have occurred, the Issuer shall retain full possession and control of the System with full right to manage, operate and use the same and every part thereof with the rights appertaining thereto, and to collect and receive and, subject to the provisions of this ordinance, to take, use and enjoy and distribute the earnings, income, rent, issue and profits accruing on or derivable from the System.
SECTION 13. The Issuer does hereby covenant and warrant so long asany of the Bonds are outstanding and unpaid in principal and/or interest:
(a) That it is or will be lawfully seized and possessed of the System, that it has a legal right to pledge the income and revenues of the System as herein provided, and that the Bonds will have a lien and privilege on said income and revenues, subject only to the prior payment of all reasonable and necessary expenses of operating and maintaining the System.
(b) That it will at all times maintain the System in first class repair and working order and condition.
(c) That it will carry full insurance coverage on the System in the manner required by the Government pursuant to the terms of the loan agreement pursuant to which the Government purchased the Bonds, and also against those risks and in the amounts normally carried by privately owned public water companies. Said insurance policies shall be issued by a responsible insurance company or companies licensed to do business under the laws of Louisiana.
In case of loss, insurance money received by the Issuer shall be used to promptly repair or replace the property damaged or deposited in the Contingencies Fund or the Short-Lived Asset Fund, as appropriate to supplement any other amounts required to be paid into the respective Funds, unless required to be deposited into the contingency fund established and maintained pursuant to the Prior Bond Resolutions.
(d) That it will maintain separate records and accounts and make full and correct entries of all transactions relating to the System. All books and accounts of the Issuer, including those pertaining to the System, shall be audited annually no later than six (6) months after the close of each fiscal year by a recognized independent firm of certified or registered public accountants, which audit shall reflect all receipts and disbursements of the Issuer, including those made for the account of the System. Such audit shall be furnished upon request to the registered owner of any of the Bonds, to the Government and to the fiscal agent bank of the Issuer.
(e) That it will not sell, lease or in any manner dispose of the System or any substantial part thereof, provided the Issuer may dispose of property which in its judgment is worn-out, unserviceable, unsuitable, or unnecessary in the operation of the System, when other property of equal value is substituted therefor, or the proceeds derived from the disposal of such property are used for constructing and acquiring extensions and improvements to the System or repairing the System.
(f) That except as provided in Section 15 hereof, it will not voluntarily create or cause to be created any debt, lien, pledge, mortgage, assignment, encumbrance, or any other charges having priority over or parity with the lien of the Bonds upon the income and revenues of the System pledged as security therefor.
(g) That, to the extent permitted by law, it will not grant a franchise to any water utility for operation within the boundaries of the Issuer which would render services or facilities in competition with the System, and will oppose the granting of such franchise by any other public body having jurisdiction over such matters.
(h) That in operating the System it shall require all officers and employees in a position of authority or in possession of money derived from operation of the System to be covered by a blanket fidelity or faithful performance bond, or independent fidelity bonds, written by a responsible indemnity company in amounts adequate to protect the Issuer from loss.
SECTION 14. All of the income and revenues earned from the operation of the System shall be deposited promptly as provided in Section 10 hereof, and the Water Revenue Fund shall be maintained with the regularly designated fiscal agent bank of the Issuer as provided herein, separate and apart from all other funds of the Issuer. All of the funds herein provided shall be and constitute trust funds for the purposes provided in this ordinance, and the registered owners of the Bonds issued pursuant to this ordinance are hereby granted a lien on all such funds and accounts until applied in the manner provided in this ordinance. The moneys in all of such funds shall at all times be secured to the full extent thereof by the bank or trust company holding such funds by direct obligations of, or obligations the principal of and the interest on which are guaranteed by, the United States of America, or direct obligations of the State of Louisiana, having a market value of not less than the amount of moneys then on deposit in said funds and accounts, or other security authorized by Louisiana law.
SECTION 15. The Bonds shall enjoy complete parity of lien on the revenues of the System despite the fact that any of the Bonds may be delivered at an earlier date than any other of the Bonds. The Issuer shall issue no other bonds or obligations of any nature payable from or enjoying a lien on the revenues of the System having priority over or parity with the Bonds except that bonds may hereafter be issued on a parity with the Bonds under the following conditions, viz:
1. The Bonds or any part thereof, including interest and redemption premiums thereon, may be refunded, and the refunding bonds so issued shall enjoy complete equality of lien with the portion of the Bonds which is not refunded, if there be any, and the refunding bonds shall continue to enjoy whatever priority of lien over subsequent issues may have been enjoyed by the Bonds refunded; provided, however, that if only a portion of the Bonds outstanding is so refunded and the refunding bonds require total principal and interest payments during any year in excess of the principal and interest which would have been required in such year to pay the Bonds refunded thereby, then such Bonds may not be refunded without the consent of the owner of the unrefunded portion of the Bonds issued hereunder.
2. Additional bonds may also be issued on a parity with the Bonds herein authorized if all of the following conditions are met:
(a) The net revenues of the System for the fiscal year immediately preceding the year in which such parity bonds are to be issued are equal to at least 110% of the average annual debt service requirements on all bonds then outstanding, including any bonds or obligations whatsoever then outstanding which are payable from the revenues of the System and any pari passu additional bonds theretofore issued and then outstanding (but not including bonds which have been refunded or provision otherwise made for their full and complete payment and redemption), and the bonds so proposed to be issued; provided, however, that this limitation may be waived or modified by the written consent of the owner of the Bonds then outstanding (Junior and subordinate bonds may be issued without restriction).
(b) There must be no delinquencies in the payments required to be made into the various funds provided in Section 10 hereof.
(c) The existence of the facts required by paragraphs (a) and (b) above must be determined and certified to by the Clerk of the Issuer or the independent firm of certified or registered public accountants who have previously audited the books of the Issuer, or by such successors thereof as may have been employed for that purpose.
(d) The proceeds of the additional bonds must be used solely for the making of improvements, extensions, renewals, replacements or repairs to the System, or refunding prior bonds issued for such purposes.
SECTION 16. The Executive Officers are hereby empowered, authorized and directed to do all things necessary and incidental to carry out the provisions of this ordinance, to cause the necessary Bonds to be printed, lithographed, or otherwise prepared, to issue, execute, seal and deliver the Bonds in accordance with the sale thereof, and to collect the purchase price therefor. All of the proceeds derived from the sale of the Bonds shall be deposited in a special Construction Account and used solely for Project costs, including the necessary legal, engineering and other incidental costs and fees in connection therewith, and in connection with the authorization and issuance of the Bonds. The Executive Officers are further authorized to execute such other documents as may be required to establish said Construction Account and are authorized to make appropriate provisions for the payment of interest estimated to accrue on the Bonds during the period of construction by providing for the deposit of moneys from the Construction Account to the Sinking Fund.
SECTION 17. The sale of the Bond to the Government is hereby ratified and approved. Exercising the power granted to the Issuer under the provisions of Part VII, Chapter 4, Title 39 of the Louisiana Revised Statutes of 1950, the Bond shall be initially physically delivered to the Government; provided, however, that upon delivery thereof the Government may elect to pay for the entire principal amount of the Bond in full at the time of delivery or elect to make advances against the full purchase price, in which event appropriate recordation shall be made on the Bond with respect to the advance payments made. Interest on the Bond will be paid only with respect to the amount of principal actually advanced by the Government until such time as the full purchase price of the Bond shall have been paid, after which interest will be paid on the full amount of the unpaid principal of the Bond then outstanding. Upon final payment of the full purchase price of the Bond, the Issuer shall furnish to the Government its final Treasurer’s Receipt and Non-Litigation Certificate, together with the final approving opinion of Bond Counsel for the Issuer. As payments or advances are made by the Government, the Issuer shall execute and provide an appropriate non-litigation certificate to the Government certifying that up to the time of making such payment or advance, no litigation has been filed questioning the validity of the Bond or the revenues necessary to pay the same. The Issuer shall also furnish to the Government at the time the Bond is delivered to the Government
(continued to #6)

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