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<br />Section 8
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<br />Innstmrn1 of Funds
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<br />(c) Failure of the City to perfonn any other covenant or agreement conlained in this
<br />Ordinance, which failure shall have continued for 60 days afler the notice thereof from the
<br />Bondholder; provided, however. that if any such failure shall be such that it cannol be currd or
<br />corrected within a 6O-day period but is, in fact. susceptible: of cure or correction, it shall not
<br />constitute an Event of Default if curative or corrective action is instituled within said period and
<br />diligenlly pursued until the failure ofperfonnancc is cured or corrected;
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<br />(a) The City shall separately invesl and reinvest any monies held in the funds
<br />established by this Ordinance in investments which would mature in amounts and at times so
<br />thai the principal of. premium. if any, and interest on, the Bond can be paid when due at
<br />maturity thereof.
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<br />(b) Permissible investments include investments in securities Ihal are legal
<br />investments under Chapter 45 of Title 2.2 of the Code of Virginia of 1950. as amended (Section
<br />2.2-4500 rtsg.) and which are otherwise in compliance with Section 15.2-2619 of the Act.
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<br />(d) 10e instituting of any proceeding with the consent of the City for the purpose of
<br />effecting composition between the City and ilS creditors or for the purpose of reducing the
<br />claims of credilors pursuanlto any federal or state statute; Of
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<br />Ddeasancr
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<br />(e) Ifthe City for any reason shall be rendered incapable of fulfilling ils obligations
<br />under this Ordinance as to the Bond.
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<br />The obligations of the City under this Ordinance and covenants oftbe City
<br />provided for herein shall be fully discharged and soIisfied as 10 the Bond and tbe Bond shall no
<br />longer be deemed 10 be Outstanding lbereunder when the Bond shall have been purchased by Ihe
<br />City and canceled or destroyed. when the payment of principal of the Bond, plus interest on such
<br />principal to the due date thereof either (a) shall have been made or (b) shall havr been provided
<br />for by irrevocably depositing with a financiaJ institution acting as escrow agent selected by the
<br />Paying Agent for the Bond. money sufficient to make such payment. or direct and general
<br />obligations of, or obligations lhe principal of, and interest on. which are guaranteed by, the
<br />United States of America, maturing in such amounts and at such times as will insure the
<br />availability of sufficient monies to make such payment.
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<br />Upon the oc:c:unencc of an Event of Dcfaull, the Bondholder may declare the principal of
<br />all of the Outstanding Bond and all accrued and unpaid inlerest thereon to be due and payable
<br />immedialely. This provision is subject 10 the condition lhat if. at any time after such declara1ion
<br />and before any such further action has been taken, all arrears of interest on. and principal of. the
<br />Bond shall have been paid and an other Events of Default. if any, which shall have occurred
<br />have been remedied. then the Bondholder may waive such default and annul such declaration.
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<br />in case an Event of Default shall occur, subject to the provisions referred to in the
<br />preceding paragraph, the Bondholder shall have the right to protect the rights vested in such
<br />Bondholder by the Ordinance by such appropriate judicial proceeding as such Bondholder shall
<br />deteonine eilher by suit in equity or by action at law.
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<br />Section 10 GrnenlOblie-ation
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<br />The Council. in accordance with Section 7 of Chapter II of the City Charter and Section
<br />15.2-2624 of the Act, is hereafter authorized and required to levy and collect annually, at the
<br />same time and in the same manner as other ta,cs of the City are assessed, levied and collected, a
<br />tax upon all taxable property within the City, over and above all other taxes, authorized or
<br />limited by law and without limitation as to rate or amount, sufficient to pay when due the
<br />principal of and premium. if any and inlerest on the Bond. to the extent other funds of the City
<br />are not lawfully available and approprialed for such purpose.
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<br />SectiOD 12 Enforcement bv Bondholder
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<br />The Bondholder may by mandamus or other appropriate proceeding at law or in equity in
<br />any court of competent jurisdiction. enforce and compel perfonnance of this Ordinance and
<br />every provision and covenant thereof concerning the Bond. including without limiting the
<br />generalily of the foregoing, the enforcement of the perfonnance of all obligations and duties and
<br />requirements to be done or perfooned by the City by the Ordinance or by the applicable laws of
<br />the Commonwealth as to the Bond.
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<br />Section 11 Ennt of Deraul1
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<br />Each of the following shall constitute an event ofdefauh hereunder
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<br />Section 1 J Modification of Bond Ordinance
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<br />(a) Failure to pay the principal of the Bond when due;
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<br />The City may without the consent of the Bondholder make any modi llcation or
<br />amendment oflhis Ordinance required to cure any ambiguity or error hercin contained or to
<br />make any amendments hereto or to grant to the Bondholder additional rights. The Bondholder
<br />shall have the power to authorize any modificalions to this Ordinance proposed by the City other
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<br />(b) Failure to pay interest on the Bond when due;
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<br />than as pemlincd above; provided Ihat wilhout Ihe consenl of the Bondholder affected thereby.
<br />no modifications shall be made whieh will (a) e,\:lend the lime of payment of principal of. or
<br />interest on, the Bond or reduce the principal amount Ihercof or the rate of intereslthcreon;
<br />(b) give to the Bond any preference over any olher bond secured equally and ratably therewith;
<br />(c) deprive the Bondholder of the security afforded by this Ordinance, or (d) reduce the
<br />percentage in principal amount of the Bond required to authorize any modification to the
<br />Ordinance.
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<br />The Council intends for the Bond to be treated as compl>ing With the provisions of
<br />Section 148(f)(4)(D) of the Code, which provides an exception from the "rebate requirement,"
<br />since the Bond (1) is issued by the City which is a governmental unit with general taxing powers,
<br />(2) no bond which is a part of this issue of the Bond is a private activity bond, (3) 95% or more
<br />of the net proceeds of the Bond are to be used for lQ(:al governmental activities entirely within
<br />the jurisdiction of the City, and (4) the aggregate face amount of all tax-exempt bonds (other
<br />than private activity bonds) issued by the City during the calendar year 2005 (and bonds issued
<br />by any subordinate entity ofthe City) is not reasonably expecled 10 exceed 55,000.000 except
<br />that. pursuant to the provisions ofSeclion 148(f)(4)(D)(vii) of the Code, this amount of
<br />$5,000,000 may increase by the lesser of $ I 0,000,000 or so much of the aggregate face amounl
<br />of all tax-exempt bonds (other than private activity bonds) issued by the City during the calendar
<br />year 2005 (and bonds issued by any subordinate enlity of the City) attributable to financing the
<br />construction (within the meaning of Section 148(f}(4)(CXiv) of the Code) of public school
<br />facilities.
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<br />Section 14 ADDlication of Proceeds: Sale of Bond
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<br />Proceeds derived from the sale of the Bond together with other monies available therefor
<br />shall be used to pay the costs of issuance and other expenses of the City relating to the issuance
<br />of the Bond and thereafter the remaining funds to be deposited in the Bond Proceeds Fund or the
<br />Escrow Fund of the Escrow Agreement shall be used for the purposes specified in Section 2 of
<br />this Ordinance and otherwise used in accordance with the provisions of the Escrow Agreemenl
<br />and this Ordinance or an opinion of Bond Counsel.
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<br />Section 16 Further Actions Authol'"ized: AODronl of Documents
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<br />Section IS No Arbilra~e Co\'enant and Co\'enants and Desi2nations as to the Code
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<br />The Mayor and Clerk of the Council and the City Manager, City Treasurer, City
<br />Allomey, Bond Counsel, the City's financial adVisor and all other officers, employees and agents
<br />of the City are hereby authorized and directed to lake any and all such further action and 10
<br />execute and deliver such other documents, certificates. undertakings. agreements or other
<br />instruments as shall be deemed necessary or desirable in order to effectuate delivery of, and
<br />paymenl for lhe Bond and the advance refunding of the Reflmded Bonds. all in accordance with
<br />the Ordinance...including but not limited to providing notices and irrevocable instructions
<br />regarding redemption of the Refunded Bonds to the Escrow Agent. any bond insurer of the
<br />Series 1999 Bonds, the trustee under the lndenture for the Series 1999 Bonds and any other
<br />party, the purchase of Govenunent Obligations (as defined in the Escrow Agreement) from
<br />proceeds ofthc Bond, the execution and delivery of fonns &OJ8-G as determined necessary by
<br />bond counsel and Non-Arbitrage Certificate and Tax Covenants and the making of any elections
<br />such officeR,. employees and agents deem desirable regarding any provision of the Code or
<br />regulations promulgated thereunder. SunTrust Bank.. as escrow agent, is hereby appointed as
<br />Escrow Agent under the Escrow Agreement. The Bond Purchase Agreement, Financing
<br />Agreement and the Escrow Agreement shall be in substantially the forms submitted to this
<br />meeting, which are hereby approved, with such completions, omissions, inser1ions, changes and
<br />revisions as may be approved by the officer executing them in his sole and absolute discretion,
<br />his execution thereof to constitute conclusive evidence of his approval of any such completions.
<br />omissions, insertions, changes and revisions.
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<br />The City hereby covenants that it will nol use or invest, or permit the use or investment of
<br />any proceeds of the Bond in a manner that would cause the Bond to be subjected to treatment
<br />under Section 148 of the Code and the regulations adopted thereunder as an "arbitrage bond,"
<br />and to that end the City shall comply with applicable regulations adopted under said Section 148
<br />of the Code
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<br />The City covenants to comply with the Code provisions requiring that any issuance of
<br />"governmental bonds," as defined therein. be subject to certain requirements as to rebate and
<br />timing and lype ofpayrnents to be paid for from the proceeds of such bonds, as well as other
<br />additional requirements. In order to assure compliance with such Code provisions, the Cily will
<br />enter into a Compliance Certificate, to comply .....ith such requirements and covenanls therein that
<br />it will not breach the teons thereof
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<br />The Council, on behalf of the City, hereby designates the Bond as a "qualified lax-
<br />exempt obligation" as defined in Section 265(b)(3)(B) orthe Code and certifies by this
<br />Ordinance that is does not reasonably anticipate the issuance by it or its subordinate entities of
<br />more lhan 510,000,000 in "qualified tax-exempt obligations" during the calendar year 2005 and
<br />will OOl designate. or pennit the designation by any of its subordinate entities of. any of ils notes
<br />or bonds (or those of its subordinate entities) during Ihe calendar year 2005 which would cause
<br />the S I 0,000,000 limitalion of Section 265(bX3 XD) of the Code to be violated
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