REGULAR COUNCIL MEETING
The Regular Council Meeting was held on December 14, 1992 at 7:30 p.m. with Council President Christiansen presiding. Members present were Councilmen Lambert, Tudor, Leary, Pitts, Salters, Levitt, Daisey and Hare.
Council staff members present were Chief Smith, Mr. Lucas, Mr. Worley, Mr. DePrima, Fire Chief Baker, Mrs. Boaman and Mr. Rodriguez.
The invocation was given by Councilman Salters, followed by the Pledge of Allegiance.
AGENDA ADDITIONS/DELETIONS
Mr. Levitt requested the addition of item #3C to consider approval of the IBEW employee contract. Mr. Lambert requested the addition of an executive session to discuss personnel and legal matters (agenda item #13A).
Mr. Hare moved for approval of the agenda as amended, seconded by Mr. Lambert and unanimously carried.
ADOPTION OF MINUTES - REGULAR COUNCIL MEETING OF NOVEMBER 23, 1992
The Minutes of the Regular Council Meeting of November 23, 1992 were unanimously approved by motion of Mr. Lambert, seconded by Mr. Levitt and bore the written approval of Mayor Knopf.
RESOLUTION - CLEALYN WILSON - TEACHER OF THE YEAR
By motion of Mr. Hare. seconded by Mr. Lambert, Council unanimously adopted the following Resolution:
WHEREAS, Clealyn Wilson began her teaching career in 1972 and has taught thousands of students during the course of her career; and
WHEREAS, Mrs. Wilson has demonstrated a sincere commitment and dedication to her career and to the students she has touched through her desire to help students develop their intellectual capacities and to achieve their highest potential; and
WHEREAS, this strong commitment to her profession was clearly seen by her peers who elected Mrs. Wilson as the 1992 Capital School District Teacher of the Year and by the statewide selection committee who elected Mrs. Clealyn Wilson as the 1992 STATE OF DELAWARE TEACHER OF THE YEAR.
NOW, THEREFORE. BE IT RESOLVED that the Mayor and Council acknowledge the vital contribution made by Mrs. Clealyn Wilson to the students at East Dover Elementary School, the Capital School District, and the State of Delaware.
BE IT FURTHER RESOLVED that the Mayor and Council commend Mrs. Clealyn Wilson for her innovative and dedicated approach to the field of teaching and congratulate her in receiving the prestigious 1992 STATE OF DELAWARE TEACHER OF THE YEAR AWARD.
ADOPTED: December 14, 1992
RESOLUTION - RETIREMENT - CHIEF JAMES L. HUTCHISON
By motion of Mr. Salters, seconded by Mr. Leary, Council unanimously adopted the following Resolution:
WHEREAS, James L. Hutchison began his career as a Patrolman with the City of Dover Police Department on September 11, 1967 and quickly rose through the ranks of the police force, being promoted to Detective in December 1970, Sergeant in December 1972, Lieutenant in March 1974, Captain in March 1979, and Chief in May 1988; and
WHEREAS, throughout his career in law enforcement, Chief Hutchison has continually sought to increase the educational level and criminal knowledge of Dover's police officers, resulting in the extremely high level of competence and professionalism it now enjoys and has taken major steps towards achieving National Accreditation, requiring extensive changes to the Police Department's procedures and computer systems which have been dramatically improved; and
WHEREAS, as a result of Chief Hutchison's diligence, the City Police Department has expanded its services to include the Community Policing Program. reinstitution of the Foot Patrol in the Downtown area and the cleanup of the Kirkwood Street area, Bicycle Patrol, Canine Patrol and institution of the DARE Program, with many of these programs being financed by Chief Hutchison's crusade in obtaining more than SI million in grant monies to the Police Department; and
WHEREAS, James L. Hutchison is well known in our City, having been an active member in many, many organizations including a Board of Director of the Boys and Girls Club of America. the Military Affairs Committee, the Delaware Police Chiefs' Foundation, the Elizabeth Murphy School, the Police Athletic League, the Salvation Army, the Dover Substance Abuse Prevention Advisory Board, the Council on Police Training, and member of the Delaware Driver's Program Advisory Council, the Delaware Police Chiefs' Council and the Capital City Rotary; and
WHEREAS, during the course of his career, Chief Hutchison has worked diligently towards the success of the City of Dover Police Department, often working nights, weekends and holidays, taking very few vacations, and having never taken a day off for illness; and
WHEREAS, after more than 25 years of dedicated service, Chief Hutchison has chosen to retire.
NOW, THEREFORE, BE IT RESOLVED that the Mayor and Council of the City of Dover wish James L. Hutchison a happy and healthy retirement and extend their sincere appreciation for the contribution he has made to our community and for the excellent work he has provided to the City of Dover during his career.
ADOPTED: December 14, 1992
Mayor Knopf and Councilman Hare presented the Resolution, City Cup and City Plaque to Chief Hutchison in appreciation of his 25 years of dedicated service. Chief Hutchison conveyed his sincere appreciation to Mayor Knopf and members of
City Council for their support to the Police Department during his 25 years of service.
REFINANCING OF BONDS - AUTHORIZING RESOLUTIONS
Councilman Levitt explained that the Proposed resolutions authorize the City of Dover to refinance the Electric Revenue Bonds and Water/Sewer Revenue Bonds. As of this date, the savings to be realized by the City from refinancing the bonds is $500,000. It was noted by the Finance Director, Mike Karia, that on page three of the Resolution, the amount of "$29,000,000" has been changed to "$22,000,000".
Mr. Levitt moved for approval of the following Resolution, as amended. The motion was seconded by Mr. Lambert and carried by a unanimous roll call vote:
RESOLUTION AUTHORIZING THE ISSUANCE AND
SALE BY THE CITY OF DOVER OF ELECTRIC
REVENUE BONDS IN AN AGGREGATE PRINCIPAL
AMOUNT OF UP TO $22,000,000 FOR THE PURPOSE
OF REFUNDING CERTAIN OUTSTANDING BONDS
WHEREAS, The City of Dover (the "City") is authorized pursuant to Chapter 111, Volume 52, Laws of Delaware, as amended, and the City Charter ' Chapter 158, Volume 36, Laws of Delaware, as amended (the "Enabling Acts") to issue revenue bonds for the purpose of financing and refinancing improvements to its electric system: and
WHEREAS, pursuant to the Enabling Acts, the City adopted a Resolution on December 23, 1985. as supplemented on April 23, 1990 (the "Bond Resolution") and pursuant to the Bond Resolution, it has issued and there remain outstanding $29,460,000 aggregate principal amount of the City's Electric Revenue Bonds (Series 1990) (the "Prior Bonds");
WHEREAS, the Bond Resolution permits the issuance of additional bonds secured on a parity with the Prior Bonds for the purposes of refunding Prior Bonds;
WHEREAS, Council wishes to authorize the issuance of the City's Electric Revenue Bonds for the purposes of refunding certain of the Prior Bonds to achieve debt service savings;
NOW THEREFORE, the Council hereby resolves as follows:
Section 1. Defined Terms. All defined terms used herein identified by initial capital letters and not otherwise defined herein shall have the meanings assigned to them in the Bond Resolution.
Section 2. Plan of Refunding. Council hereby authorizes the refunding of any or all of that portion of the Prior Bonds identified by the Mayor and Treasurer which can be refunded to produce a present value savings.
Section 3. The Refunding Bonds. Pursuant to the Enabling Acts and the Bond Resolution the Council hereby authorizes and directs the issuance of The City of Dover, Electric Revenue Bonds, in the aggregate principal amount up to $22,000.000 (the "Refunding Bonds"), for the purposes of refunding Prior Bonds, including paying the costs of issuance. For the purposes of this Resolution, “aggregate principal amount" means total principal amount less original issue discount, if any. The Refunding Bonds shall be dated, shall bear interest, shall mature, shall be payable, shall be subject to redemption, shall be in such denominations, shall be numbered, shall have such series designation and shall be in substantially the form set out in Exhibit A with such modifications as the Mayor and the Treasurer shall determine shall be consistent with the final terms of the Refunding Bonds.
The Refunding Bonds shall be special obligations of The City of Dover, and shall be payable solely from the Net Operating Revenue. The full faith and credit of the City shall not be pledged to pay principal of and interest on the Refunding Bonds.
Payment of the principal of and interest on the Refunding Bonds shall be made in accordance with the provisions set forth in the Bond Resolution and as shall otherwise be determined by the Mayor and Treasurer.
Section 4. Pledge of Revenues; Parity Bonds. Pursuant to Section 701 of the Bond Resolution, the City has pledged. and does hereby ratify and confirm said pledge of, the Revenues of the Electric System to the payment of the principal of, premium, if any, and interest on, every bond issued under the Bond Resolution, including the Refunding Bonds, as and to the extent provided in the Bond Resolution. The Refunding Bonds will be issued pursuant to Section 210 of the Bond Resolution and will be secured on a parity with the other Bonds issued under the Bond Resolution.
Section 5. Sale of Refunding Bonds. The Refunding Bonds shall be sold by the City in a private negotiated sale to a firm or syndicate of investment banking firms selected by the Mayor and Treasurer pursuant to such terms and conditions as the Mayor and the Treasurer shall determine will produce a present value savings and will otherwise be in the best interest of the City. Promptly following such sale, the Mayor shall advise the Council of the terms of the Refunding Bonds and the sale thereof.
Section 6. Preliminary Official Statement and Official Statement. The Mayor and Treasurer are authorized to prepare a Preliminary Official Statement and a final Official Statement with respect to the sale and issuance of the Refunding Bonds and to arrange for their distribution to prospective purchasers of the Refunding Bonds. The Mayor and the City Treasurer are hereby authorized to execute the Preliminary Official Statement in the name of the City, to supervise its distribution to prospective purchasers of the Refunding Bonds prior to the availability of the final Official Statement and to make changes thereto to the date of delivery of said Refunding Bonds to make the information therein not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they are made, not misleading.
The Mayor and Treasurer are hereby authorized to execute a final official Statement in the name of the City, to supervise its distribution to prospective purchasers of the Refunding Bonds and to make any changes thereto to the date of delivery as aforesaid with respect to the Preliminary Official Statement.
Section 7. Notice of Bond Resolution. The City Clerk is directed to publish forthwith once in a newspaper published in the City a notice in substantially the following form:
"Notice is hereby given that a resolution entitled as follows:
"Resolution Authorizing the Issuance and Sale By The City of Dover of Electric Revenue Bonds in an Aggregate Principal Amount of up to S22,000,000 for the Purpose of Refunding Certain Outstanding Bonds"
was duly adopted by the City Council of The City of Dover, Delaware on December 14, 1992. The purpose of the issuance of said bonds is to refinance certain outstanding electric revenue bonds to achieve debt service savings. Any action or proceeding to contest the validity of said resolution or any of its provisions must be commenced within thirty (30) days after publication of this notice. After expiration of such period of limitation, no right of action or defense founded upon the invalidity of said resolution or any of its provisions shall be asserted, nor shall the validity of said resolution or any of its provisions be open to question in any court upon any ground whatsoever, except in an action or proceeding commenced within such period.
By order of the City Council of The City of Dover.
City Clerk"
Section 8. Final Terms of Bonds. The Council hereby authorizes the Mayor and the City Treasurer to determine the final terms and conditions of the issuance and sale of the Refundincr Bonds including, without limitation, the establishment of maturities and payment terms, the date of sale and the redemption features, as they determine to be in the best interests of the City. The Mayor and Treasurer are further authorized to take all other appropriate action to carry out the intent of this Resolution including entering into an Escrow Agreement with an Escrow Agent in connection with the refunding of Prior Bonds and giving notice of the call for redemption of the Prior Bonds to be refunded.
Section 9. Tax Covenants. The City covenants for the benefit of the owners of the Refunding Bonds (i) that no use of the proceeds of the Refunding Bonds or the earnings thereon will be made, and no other action will be taken, which would cause said Bonds to be "arbitrage bonds" within the meaning of Section 148(a) of the Internal Revenue Code of 1986, as amended (the "Code"), (ii) that all action with respect to said Bonds required to be taken to avoid characterization of said Bonds as "arbitrage bonds" under Section 148 of the Code shall be taken, (iii) that the City will take all reasonable steps to ensure that interest on said Bonds is not included in gross income of the owner of any such Bond for purposes of federal income taxation and (iv) that the City will take no action to cause said Bonds to become "private activity bonds" as that term is used in Section 141(a) of the Code.
APPROVED by the Council of The City of Dover, the day of 1992.
City Clerk
The City of Dover
APPROVED by the Mayor of The City of Dover the day of 1992.
Mayor, The City of Dover
$
EXHIBIT A
STATE OF DELAWARE
THE CITY OF DOVER
ELECTRIC REVENUE REFUNDING BOND
(SERIES )
INTEREST RATE MATURITY DATE DATED DATE CUSIP
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
The City of Dover (herein called the “City”), a municipal corporation in the County of Kent, State of Delaware, for value received, hereby promises to pay, solely from the sources hereinafter described, to the Registered Owner identified above, or registered assigns, the Principal Amount identified above on the Maturity Date specified above, unless this Bond shall have been previously called for redemption and payment of the redemption price shall have been duly made or provided for in accordance with the hereinafter described Bond Resolution, and to pay (but only out of the sources hereinafter described) interest at the Interest Rate specified above on such Principal Amount from the interest payment date next preceding the date of registration and authentication of this bond, unless this bond is registered and authenticated as of an interest payment date, in which event this Bond shall bear interest from such interest payment date, or unless this Bond is registered and authenticated prior to 1, 19 , in which event this Bond shall bear interest from 1, 19 or unless, as shown by the records of the hereinafter referred to Trustee, interest on the hereinafter referred to Bonds shall be in default, in which event this Bond shall bear interest from the last date to which interest has been paid, at the rate specified above payable semiannually on January 1 and July 1 of each year commencing on 1, 19 , until payment in full of such Principal Amount, and to pay interest on overdue principal and, to the extent permitted by law, on overdue interest at the rate specified above. Principal of and interest on this Bond is payable in lawful money of the United States of America at the principal corporate trust office of Delaware Trust Company, Wilmington, Delaware, as Paying Agent, or its successor (the "Paying Agent"); provided, however, that payment of the semiannual interest hereon shall be made to the person in whose name this Bond is registered as of the close of business on the 15th day of the calendar month next preceding each interest payment date by check or draft mailed to such registered owner at such owner's address as it appears on the registration books of the Trustee, as Registrar, or at such other address as is furnished in writing by such registered owner to the Paying Agent.
THIS BOND IS NOT A DEBT OF THE CITY OR A PLEDGE OF THE FAITH AND CREDIT OF THE CITY, BUT IS PAYABLE SOLELY FROM THE SPECIAL FUND PROVIDED THEREFOR FROM THE REVENUES OF THE ELECTRIC SYSTEM OF THE CITY, AS PROVIDED BY THE ENABLING ACT (HEREINAFTER MENTIONED) AND THE BOND RESOLUTION AND FROM THE INTEREST AND SINKING FUND ESTABLISHED UNDER THE BOND RESOLUTION, AND THE OWNER HEREOF HAS NO RIGHT TO COMPEL THE LEVY OF ANY TAX FOR THE PAYMENT OF THIS BOND OR THE INTEREST TO ACCRUE THEREON. THE CITY IS NOT OBLIGATED TO PAY THIS BOND OR THE INTEREST HEREON EXCEPT FROM SUCH SPECIAL FUNDS, AND NO OWNER OF THIS BOND SHALL EVER HAVE THE RIGHT TO ENFORCE THE PAYMENT THEREOF AGAINST ANY PROPERTY OF THE CITY, AND THIS BOND DOES NOT CONSTITUTE A CHARGE, LIEN OR ENCUMBRANCE, LEGAL OR EQUITABLE, UPON ANY PROPERTY OF THE CITY.
This bond is one of a duly authorized series of revenue bonds of the City, designated "Electric Revenue Bonds (Series 19 )", in the original aggregate principal amount of $ (the "Series Bonds") issued pursuant to a Resolution adopted by the City on December 23, 1985, as amended by Resolutions adopted April 23, 1990 and ,19 (collectively, the "Bond
Resolution"), to provide funds for refunding a portion of the outstanding Electric Revenue Bonds of the City. The Bond Resolution also provides for the issuance, from time to time, under the conditions, limitations and restrictions therein set forth, of additional Bonds for the purpose of paying all or a part of the cost of additional improvements of the City's electric system (the "Electric System") , and for the purpose of refunding any Bonds issued by the City under the provisions of the Bond Resolution. Reference is hereby made to the Bond Resolution for the provisions, among others, with respect to the custody and application of the proceeds of Bonds issued under the Bond Resolution, the collection and disposition of revenues, the funds charged with and pledged to the payment of the interest on and the principal of the Bonds, the nature and extent of the security, the terms and conditions on which the Bonds of each series are or may be issued, the rights, duties and obligations of the City and of the Trustee under the Bond Resolution and the rights of the owners of the Bonds, and, by the acceptance of this bond, the owner hereof assents to all the provisions of the Bond Resolution.
This bond is issued and the Bond Resolution was adopted under and pursuant to the Constitution and laws of the State of Delaware, particularly Chapter III, Volume 52, Laws of Delaware, as amended by Chapter 340, Volume 57, Laws of Delaware, (the "Enabling Act"). The Bond Resolution, in accordance with and as required by the Enabling Act, provides for the fixing, revising and collecting by the City of rates. fees and other charges for the use of, and for the services and facilities furnished by, the Electric System which will provide revenues sufficient at all times to pay the cost of maintaining, repairing and operating the Electric System and provide reserves therefor and to pay the principal of and the interest on all bonds issued under the provisions of the Bond Resolution and then Outstanding as the same shall become due and payable and to provide reserves therefor. The Bond Resolution provides for the creation of a special fund designated "City of Dover Electric Revenue Bonds Interest and Sinking Fund" (the "Interest and Sinking Fund"), which special fund is pledged to and charged with the Payment of the principal of and the interest on all Bonds issued under the provisions of the Bond Resolution. The Bond Resolution also provides for the City to apply the revenues of the Electric System to maintain an Improvement and Extension Fund. After Providing for current expenses of the Electric System and current debt service payments on the Bonds issued under the Bond Resolution, certain reserves therefor and the required level of contribution to the Improvement and Extension Fund, the Bond Resolution permits the City to apply the net revenues remaining from the Electric System to any lawful purpose of the City.
The Series Bonds maturing July 1, are subject to mandatory sinking fund redemption as follows:
Redemption Date Amount
The required sinking fund redemption installments will be reduced, in any order selected by the City, by the principal amount of any Bonds of the appropriate maturity purchased or redeemed pursuant to an Optional Redemption as provided in the Bond Resolution.
The Series Bonds which mature on or after July 1, are also subject to optional redemption by the City on or after July 1, but prior to their stated maturity date, in whole or in part on any date and in any order of maturity selected by the City, at redemption prices equal to the percentage of the principal amount indicated below, plus accrued interest to the redemption date:
Redemption Date Redemption Price
July 1, through June 30, %
July 1, through June 30,
July 1, and thereafter
The Series Bonds are also subject to extraordinary optional redemption, prior to maturity, as and to the extent provided in the Bond Resolution.
The moneys in the Interest and Sinking Fund available for the purchase or redemption of Bonds shall be allocated in the manner set forth in the Bond Resolution.
If less than all of the Bonds of a series of any one maturity shall be called for redemption, the particular Bonds to be redeemed shall be selected by lot by the Trustee as provided in Article III of the Bond Resolution.
Any such redemption, either in whole or in part, shall be made upon at least thirty (30) days' prior written notice as provided in the Bond Resolution, and shall be made in the manner and under the terms and conditions provided in the Resolution. Bonds which have been duly called for redemption, or with respect to which irrevocable instructions to call for redemption have been given to the Trustee and moneys for payment of the redemption price being held by the Trustee under the Bond Resolution, shall become and be due and payable at the redemption price provided for redemption of such bonds on the date designated for redemption; interest on the Bonds so called for redemption shall thereafter cease to accrue; such Bonds shall cease to be entitled to any benefit or security under the Bond Resolution; and the registered owners of such Bonds shall have no rights in respect thereof except to receive payment of the redemption price thereof so held by the Trustee or by the Paying Agent.
Modifications or alterations of the Bond Resolution or of any resolution supplemental thereto may be made to the extent and in the circumstances permitted by the Bond Resolution.
This bond is transferable by the registered owner hereof in person or by his attorney duly authorized in writing at the principal corporate trust office of the Trustee but only in the manner, and subject to the limitations and upon payment of the charges provided in the Bond Resolution, and upon surrender and cancellation of this bond. Upon such transfer, a new bond or Bonds of the same maturity or maturities, interest rate or rates and of an authorized denomination or denominations, for the same aggregate principal amount will be issued to the transferee in exchange therefor. The City and the Trustee may deem and treat the registered owner hereof as the absolute owner hereof (whether or not this bond shall be overdue) for the purpose of receiving payment of or on account of principal and interest due on the Bonds and for all other purposes, and neither the City nor the Trustee shall be affected by any notice to the contrary. The City and the Trustee are not required (a) to issue, transfer or exchange any Bonds during the period beginning, at the opening of business on the 15th day of the month preceding any interest payment date and ending at the close of business on the interest payment date, or (b) to transfer or exchange any Bonds selected, called or being called for redemption in whole or in part.
As declared by the Enabling Act, this bond shall be negotiable for all purposes, except as restricted by registration. This bond is issued with the intent that the Laws of the State of Delaware shall govern its construction.
All acts, conditions and things required by the Constitution and laws of the State of Delaware and the ordinances and resolutions of the City to happen, exist and be performed precedent to and in issuance of this bond have happened, exist and have been performed as so required.
This bond shall not be valid or become obligatory for any purpose or be entitled to any benefit or security under the Bond Resolution until the certificate of authentication appended hereto shall have been signed by the Trustee.
IN WITNESS WHEREOF, The City of Dover has caused this bond to bear the manual signature of its Mayor and the manual signature of its City Clerk, and to have its corporate seal impressed hereon.
Mayor
City Clerk
(SEAL)
(ENDORSEMENTS UPON BONDS)
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This bond is one of the Bonds of the series designated therein and issued under the provisions of the within mentioned Resolution.
DELAWARE TRUST COMPANY
As Trustee
By
Date of Authentication Authorized Officer
(FORM OF ASSIGNMENT)
ASSIGNMENT
For the value received, the undersigned sells, assigns and transfers unto the within Bond and does hereby irrevocably constitute attorney to transfer the said Bond on the books kept for registration of said Bond with full power of substitution in the premise.
Dated:
Signature of Registered Owner
NOTICE: The signature(s) to this assignment must correspond with the name as it appears on the face of the within Bond in every particular, without alteration or enlargement or any change whatever.
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed by a member of firm of the New York Stock Exchange or a commercial bank or trust company.
Mr. Levitt moved for approval of the following Resolution. The motion was seconded by Mr. Lambert and carried by a unanimous roll call vote:
RESOLUTION AUTHORIZING THE ISSUANCE AND
SALE BY THE CITY OF DOVER OF WATER AND
SEWER REVENUE BONDS IN AN AGGREGATE
PRINCIPAL AMOUNT OF UP TO $10,000,000 FOR
THE PURPOSE OF REFUNDING CERTAIN OUTSTANDING BONDS
Whereas, The City of Dover (the "City") is authorized pursuant to Chapter 111, Volume 52, Laws of Delaware, as amended, and the City Charter, Chapter 158, Volume 36, Laws of Delaware, as amended (the "Enabling Acts") to issue revenue bonds for the purpose of financing and refinancing improvements to its water and sewer system; and
Whereas, pursuant to the Enabling Acts, the City has issued and there remain outstanding $6,695,000 aggregate principal amount of the City's Water and Sewer Revenue Bonds (1986 Series A and Series B) and $3,730,000 aggregate principal amount of the City's Water and Sewer Revenue Bonds - Series 1989 (collectively, the "Prior Bonds").
Whereas, the Prior Bonds are subject to the terms of a Water and Sewer Revenue Bond Resolution adopted by City Council on February 27, 1989 (the "Bond Resolution") which permits the issuance of additional bonds secured on a parity with the Prior Bonds for the purposes of refunding Prior Bonds;
Whereas, Council wishes to authorize the issuance of the City's Water and Sewer Revenue Bonds for the purposes of refunding certain of the Prior Bonds to achieve debt service savings;
Now Therefore, the Council hereby resolves as follows:
Section 1. Defined Terms. All defined terms used herein identified by initial capital letters and not otherwise defined herein shall have the meanings assigned to them in the Bond Resolution.
Section 2. Plan of Refunding. Council hereby authorizes the refunding of any or all of that portion of the Prior Bonds identified by the Mayor and Treasurer which can be refunded to produce a present value savings.
Section 3. The Refunding Bonds. Pursuant to the Enabling Acts and the Bond Resolution the Council hereby authorizes and directs the issuance of The City of Dover, Water and Sewer Revenue Bonds, in the aggregate principal amount up to $10,000,000 (the "Refunding Bonds"), for the purposes of refunding Prior Bonds, including paying the costs of issuance. For the purposes of this Resolution, “aggregate principal amount" means total principal amount less original issue discount, if any. The Refunding Bonds shall be dated, shall bear interest, shall mature, shall be payable, shall be subject to redemption, shall be in such denominations, shall be numbered, shall have such series designation and shall be in substantially the form set out in Exhibit A with such modifications as the Mayor and the Treasurer shall determine shall be consistent with the final terms of the Refunding Bonds.
The Refunding Bonds shall be special obligations of The City of Dover, and shall be payable solely from the Net Operating Revenue. The full faith and credit of the City shall not be pledged to pay principal of and interest on the Refunding Bonds.
Payment of the principal of and interest on the Refunding Bonds shall be made in accordance with the provisions set forth in the Bond Resolution and as shall otherwise be determined by the Mayor and Treasurer.
Section 4. Pledge of Net Operating Revenue. The City hereby pledges the Net Operating Revenue to the payment of principal of and interest on all Bonds in accordance with the provisions set forth in the Bond Resolution.
Section S. Parity Bonds. The Refunding Bonds will be secured on a parity with the other Bonds issued under the Bond Resolution. In addition to the requirements provided herein, the Refunding Bonds may only be issued and sold if the following conditions are met at closing:
(1) No Default has occurred and is continuing;
(2) There is no deficiency in the Redemption Fund or the Reserve Account;
(3) The City has on file in the Treasurer's office a report of an independent, consulting engineer that the schedule of rates and charges which have been previously authorized by the City are sufficient to produce, on a pro forma basis, Net Operating Revenue in the fiscal year immediately following the fiscal year in which the Refunding, Bonds are to be issued at least equal to 1.20 times the Maximum Annual Debt Service on all outstanding Bonds, including the proposed Refunding Bonds.
Section 6. Sale of Refunding Bonds. The Refunding Bonds shall be sold by the City in a private negotiated sale to a firm or syndicate of investment banking firms selected by the Mayor and Treasurer pursuant to such terms and conditions as the Mayor and the Treasurer shall determine will produce a present value savings and will otherwise be in the best interest of the City. Promptly following such sale, the Mayor shall advise the Council of the terms of the Refunding Bonds and the sale thereof.
Section 7. Preliminary Official Statement and Official Statement. The Mayor and ent Treasurer are authorized to prepare a Preliminary Official Statement and a final Official Statement with respect to the sale and issuance of the Refunding Bonds and to arrange for their distribution to prospective purchasers of the Refunding Bonds. The Mayor and the City Treasurer are hereby authorized to execute the Preliminary Official Statement in the name of the City, to supervise its distribution to prospective purchasers of the Refunding Bonds prior to the availability of the final official Statement and to make changes thereto to the date of delivery of said Refunding Bonds to make the information therein not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they are made, not misleading.
The Mayor and Treasurer are hereby authorized to execute a final Official Statement in the name of the City, to supervise its distribution to prospective purchasers of the Refunding Bonds and to make any changes thereto to the date of delivery as aforesaid with respect to the Preliminary Official Statement.
Section 8. Notice of Bond Resolution. The City Clerk is directed to publish forthwith once in a newspaper published in the City a notice in substantially the following form:
"Notice is hereby given that a resolution entitled as follows:
"Resolution Authorizing the Issuance and Sale By The City of Dover of Water and Sewer Revenue Bonds in an Aggregate Principal Amount of up to $10,000.000 for the Purpose of Refunding Certain Outstanding Bonds"
was duly adopted by the City Council of The City of Dover, Delaware on December 14, 1992. The purpose of the issuance of said bonds is to refinance certain outstanding water and sewer revenue bonds to achieve debt service savings. Any action or proceeding to contest the validity of said resolution or any of its provisions must be commenced within thirty (30) days after publication of this notice. After expiration of such period of limitation, no right of action or defense founded upon the invalidity of said resolution or any of its provisions shall be asserted, nor shall the validity of said resolution or any of its. provisions be open to question in any court upon any ground whatsoever, except in an action or proceeding commenced within such period.
By order of the City Council of The City of Dover.
City Clerk"
Section 9. Final Terms of Bonds. The Council hereby authorizes the Mayor and the City Treasurer to determine the final terms and conditions of the issuance and sale of the Refunding Bonds including. without limitation, the establishment of maturities and payment terms, the date of sale and the redemption features, as they determine to be in the best interests of the City. The Mayor and Treasurer are further authorized to take all other appropriate action to carry out the intent of this Resolution including entering into an Escrow Agreement with an Escrow Agent in connection with the refunding of Prior Bonds and giving notice of the call for redemption of the Prior Bonds to be refunded.
Section 10. Tax Covenants. The City covenants for the benefit of the owners of the Refunding Bonds (I) that no use of the proceeds of the Refunding Bonds or the earnings thereon will be made, and no other action will be taken, which would cause said Bonds to be "arbitrage bonds" within the meaning of Section 148(a) of the Internal Revenue Code of 1986, as amended (the "Code"), (ii) that all action with respect to said Bonds required to be taken to avoid characterization of said Bonds as "arbitrage bonds" under Section 148 of the Code shall be taken, (iii) that the City will take all reasonable steps to ensure that interest on said Bonds is not included in gross income of the owner of any such Bond for purposes of federal income taxation and (iv) that the City will take no action to cause said Bonds to become "private activity bonds" as that term is used in Section 141(a) of the Code.
APPROVED by the Council of The City of Dover, the day of ,1992.
City Clerk
The City of Dover
APPROVED by the Mayor of The City of Dover, the day of