Loading...
HomeMy WebLinkAbout2006-512-06/12/2006 (This Notice to be posted) NOTICE AND CALL OF PUBLIC MEETING Governmental Body: The City Council of Waterloo, Iowa. Date of Meeting: June 12 , 2006. Time of Meeting: 5 : 30 o'clock P .M. Place of Meeting: Council Chambers, City Hall, Waterloo, Iowa. PUBLIC NOTICE IS HEREBY GIVEN that the above mentioned governmental body will meet at the date, time and place above set out. The tentative agenda for said meeting is as follows: $1,900,000 General Obligation Bonds, Taxable Series 2006B • Approval of Continuing Disclosure Certificate. • Resolution authorizing the issuance. Such additional matters as are set forth on the additional 33 page(s) attached hereto. (number) This notice is given at the direction of the Mayor pursuant to Chapter 21, Code of Iowa, and the local rules of said governmental body. Nancy Ecke City Clerk, loo, Iowa June 12 , 2006 The City Council of Waterloo, Iowa, met in regular session, in the Council Chambers, City Hall, Waterloo, Iowa, at 5 :3 o o'clock p.M., on the above date. There were present Mayor Tim Hurley , in the chair, and the following named Council Members: Kincaid, Welper, Gunderson, Greenwood, Cole, Schmitt Absent: Getty * * * * * * * -1- Council Member Gunderson moved that the form of Continuing Disclosure Certificate be placed on file and approved. Council Member Schmitt seconded the motion. The roll was called and the vote was, AYES: Kincaid, Welper, Gunderson, Greenwood, Cole, Schmitt NAYS: none Council Member Gunderson introduced the following Resolution entitled "RESOLUTION AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF $1,900,000 GENERAL OBLIGATION BONDS, TAXABLE SERIES 2006B, AND LEVYING A TAX TO PAY SAID BONDS" and moved that it be adopted. Council Member Schmitt seconded the motion to adopt, and the roll being called thereon, the vote was as follows: AYES: Kincaid, Welper, Gunderson, Greenwood, Cole, Schmitt NAYS: none Whereupon, the Mayor declared said Resolution duly adopted as follows: RESOLUTION NO. 2006-512 RESOLUTION AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF $1,900,000 GENERAL OBLIGATION BONDS, TAXABLE SERIES 2006B, AND LEVYING A TAX TO PAY SAID BONDS WHEREAS, the City of Waterloo, Iowa is duly incorporated, organized and exists under and by virtue of the laws and Constitution of the State of Iowa; and WHEREAS, the City of Waterloo, Iowa, is in need of funds to pay costs of the -2- acquisition, construction and improvement of real and personal property useful for the protection of property from floods or high waters, including flood control and drainage improvements; the construction, reconstruction and repairing of street, sidewalk and intersection improvements; the improvement and repair of bridges; the acquisition, construction and installation of storm sewer and sanitary sewer improvements; the acquisition of vehicles and capital equipment for the Police, Fire Rescue and Street Departments; the acquisition, rehabilitation and demolition of abandoned, dilapidated or dangerous buildings; the rehabilitation and improvement of City parks and the acquisition, repair and replacement of facilities, equipment and improvements commonly found in City parks, including bikeway development, tennis court improvements and mowing equipment; and the acquisition, improvement and installation of traffic control devices, signage, fixtures and equipment, including traffic signal and street light improvements; and the acquisition and improving of the automated GIS/GPS mapping system, essential corporate purpose projects, and it is deemed necessary and advisable that the City issue general obligation bonds for said purpose to the amount of not to exceed $4,155,000 as authorized by Section 384.25 of the City Code of Iowa; and WHEREAS, pursuant to notice published as required by Section 384.25 this Council has held a public meeting and hearing on May 22, 2006, upon the proposal to institute proceedings for the issuance of the above described bonds, and all objections, if any, to such Council action made by any resident or property owner of said City were received and considered by the Council; and it is the decision of the Council that additional action be taken for the issuance of said bonds, and that such action is considered to be in the best interests of said City and the residents thereof; WHEREAS, the City of Waterloo, Iowa, also is in need of funds to pay costs of the aiding in the planning, undertaking and carrying out of urban renewal project activities under Chapter 403 of the Code of Iowa, as amended, and the Urban Renewal Plans for the San Marnan Urban Renewal Area, the Logan Tax Increment Redevelopment Area and the Rath Tax Increment Redevelopment Area, including consulting fees and other planning expenses, property acquisitions and clearance for public and private redevelopment, and incentive payments relating to the acquisition and private redevelopment of properties within such areas, essential corporate purpose projects, and it is deemed necessary and advisable that the City issue general obligation bonds for said purpose to the amount of not to exceed $1,680,000 as authorized by Sections 384.24(3)(q) and 384.25 of the City Code of Iowa; and WHEREAS, pursuant to notice published as required by Sections 384.24(3)(q) and 384.25 this Council has held a public meeting and hearing on May 22, 2006, upon the proposal to institute proceedings for the issuance of the above described bonds, and no -3- petitions were received calling for an election thereon, and all objections, if any, to such Council action made by any resident or property owner of said City were received and considered by the Council; and it is the decision of the Council that additional action be taken for the issuance of said bonds, and that such action is considered to be in the best interests of said City and the residents thereof; WHEREAS, the City of Waterloo, Iowa, also is in need of funds to pay costs of the reconstruction, remodeling, improvement and repairing of City buildings and facilities, including the Five Sullivan Brothers Center, Young Arena, Police Department, Fire Stations, and Public Library, general corporate purpose projects, and it is deemed necessary and advisable that the City issue general obligation bonds for said purpose to the amount of not to exceed $700,000, as authorized by Section 384.26 of the City Code of Iowa; and WHEREAS, pursuant to notice published as required by Section 384.26(5) this Council has held a public meeting and hearing on May 22, 2006, upon the proposal to institute proceedings for the issuance of the above described bonds, and no petitions were received calling for an election thereon, and all objections, if any, to such Council action made by any resident or property owner of said City were received and considered by the Council; and it is the decision of the Council that additional action be taken for the issuance of said bonds, and that such action is considered to be in the best interests of said City and the residents thereof; WHEREAS, the City of Waterloo, Iowa, also is in need of funds to pay costs of the reconstruction, renovation and improvement of the Riverfront Stadium, swimming pools and sports facilities; and improvements to the Center for the Arts, general corporate purpose projects, and it is deemed necessary and advisable that the City issue general obligation bonds for said purpose to the amount of not to exceed $475,000, as authorized by Section 384.26 of the City Code of Iowa; and WHEREAS, pursuant to notice published as required by Section 384.26(5) this Council has held a public meeting and hearing on May 22, 2006, upon the proposal to institute proceedings for the issuance of the above described bonds, and no petitions were received calling for an election thereon, and all objections, if any, to such Council action made by any resident or property owner of said City were received and considered by the Council; and it is the decision of the Council that additional action be taken for the issuance of said bonds, and that such action is considered to be in the best interests of said City and the residents thereof; WHEREAS, pursuant to Section 384.28 of the City Code of Iowa, it has been -4- heretofore found and determined that certain of general obligation bonds authorized as hereinabove described should be combined for the purpose of issuance and sale in a single issue of corporate purpose bonds (the "Bonds") as hereinafter set forth; and WHEREAS, pursuant to the provisions of Chapter 75 of the Code of Iowa, the above mentioned Bonds were heretofore sold at public sale and action should now be taken to issue said Bonds conforming to the terms and conditions of the best bid received at the advertised public sale. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF WATERLOO, IOWA: Section 1. Definitions. The following terms shall have the following meanings in this Resolution unless the text expressly or by necessary implication requires otherwise: ❑ "Authorized Denominations" shall mean $5,000 or any integral multiple thereof. ❑ "Beneficial Owner" shall mean the person in whose name such Bond is recorded as the beneficial owner of a Bond by a Participant on the records of such Participant or such person's subrogee. ❑ "Bondholders" or "Holder" shall mean the person or persons in whose name or names a Bond shall be registered by the Registrar. ❑ "Bonds" shall mean $1,900,000 General Obligation Bonds, Taxable Series 2006B, authorized to be issued by this Resolution. ❑ "Business Day" shall mean any day which is not a Saturday or Sunday and is not a legal holiday on which federally chartered savings banks, banks or trust companies located in Waterloo, Iowa are authorized or required by law to close. ❑ "Cede & Co." shall mean Cede & Co., the nominee of DTC, and any successor nominee of DTC with respect to the Bonds. ❑ "Continuing Disclosure Certificate" shall mean that certain Continuing Disclosure Certificate executed by the Issuer and dated the date of issuance and delivery of the Bonds, as originally executed and as it may be -5- amended from time to time in accordance with the terms thereof. ❑ "Depository Bonds" shall mean the Bonds as issued in the form of one global certificate for each maturity, registered in the Registration Books maintained by the Registrar in the name of DTC or its nominee. ❑ "DTC" shall mean The Depository Trust Company, New York, New York, a limited purpose trust company, or any successor book-entry securities depository appointed for the Bonds. ❑ "Insurance Policy" shall mean the municipal bond insurance policy issued by XL Capital Assurance Inc. insuring the payment when due of the principal of and interest on the Bonds as provided therein. ❑ "Insured Bonds" shall mean the Bonds. ❑ "Issuer" and "City" shall mean the City of Waterloo, Iowa. ❑ "Participants" shall mean those broker-dealers, banks and other financial institutions for which DTC holds Bonds as securities depository. ❑ "Paying Agent" shall mean Wells Fargo Bank, National Association, or such successor as may be approved by Issuer as provided herein and who shall carry out the duties prescribed herein as Issuer's agent to provide for the payment of principal of and interest on the Bonds as the same shall become due. ❑ "Project Fund" shall mean the fund required to be established by this Resolution for the deposit of the proceeds of the Bonds. ❑ "Registrar" shall mean Wells Fargo Bank, National Association of Des Moines, Iowa, or such successor as may be approved by Issuer as provided herein and who shall carry out the duties prescribed herein with respect to maintaining a register of the owners of the Bonds. Unless otherwise specified, the Registrar shall also act as Transfer Agent for the Bonds. ❑ "Representation Letter" shall mean the Blanket Issuer Letter of Representations executed and delivered by the Issuer to DTC. ❑ "Resolution" shall mean this resolution authorizing the Bonds. -6- ❑ "Treasurer" shall mean the City Treasurer or such other officer as shall succeed to the same duties and responsibilities with respect to the recording and payment of the Bonds issued hereunder. ❑ "XLCA" shall mean XL Capital Assurance Inc., a New York stock insurance company, as issuer of the Insurance Policy with respect to the Bonds. Section 2. Levy and Certification of Annual Tax; Other Funds to be Used. (a) Levy of Annual Tax. That for the purpose of providing funds to pay the principal and interest of the Bonds hereinafter authorized to be issued, there is hereby levied for each future year the following direct annual tax on all of the taxable property in Waterloo, Iowa, to-wit: FISCAL YEAR (JULY 1 TO JUNE 30) AMOUNT YEAR OF COLLECTION: $216,322 2007/2008 $213,161 2008/2009 $207,255 2009/2010 $211,349 2010/2011 $214,880 2011/2012 $212,849 2012/2013 $210,536 2013/2014 $207,943 2014/2015 $210,068 2015/2016 $211,593 2016/2017 $212,473 2017/2018 $207,783 2018/2019 $212,720 2019/2020 $211,700 2020/2021 (NOTE: For example the levy to be made and certified against the taxable valuations of January 1, 2007, will be collected during the fiscal year commencing July 1, 2008). (b) Resolution to be Filed With County Auditor. A certified copy of this Resolution should be filed with the County Auditor of Black Hawk County, Iowa, and said Auditor is hereby instructed in and for each of the years as provided, to levy and assess the tax hereby authorized in Section 2 of this Resolution, in like -7- manner as other taxes are levied and assessed, and such taxes so levied in and for each of the years aforesaid be collected in like manner as other taxes of the City are collected, and when collected be used for the purpose of paying principal and interest on said Bonds issued in anticipation of said tax, and for no other purpose whatsoever. (c) Additional City Funds Available. Principal and interest coming due at any time when the proceeds of said tax on hand shall be insufficient to pay the same shall be promptly paid when due from current funds of the City available for that purpose and reimbursement shall be made from such special fund in the amounts thus advanced. Section 3. Bond Fund. Said tax shall be collected each year at the same time and in the same manner as, and in addition to, all other taxes in and for the City, and when collected they shall be converted into a special fund within the Debt Service Fund to be known as the "GENERAL OBLIGATION BOND FUND 2006B" (the "Bond Fund"), which is hereby pledged for and shall be used only for the payment of the principal of and interest on the Bonds hereinafter authorized to be issued; and also there shall be apportioned to said fund its proportion of taxes received by the City from railway, express, telephone and telegraph companies and other taxes assessed by the Iowa State Department of Revenue. Section 4. Application of Bond Proceeds. Proceeds of the Bonds other than accrued interest except as may be provided below shall be credited to the Project Fund and expended therefrom for the purposes of issuance. Any amounts on hand in the Project Fund shall be available for the payment of the principal of or interest on the Bonds at any time that other funds shall be insufficient to the purpose, in which event such funds shall be repaid to the Project Fund at the earliest opportunity. Any balance on hand in the Project Fund and not immediately required for its purposes may be invested not inconsistent with limitations provided by law or this Resolution. Accrued interest, if any, shall be deposited in the Bond Fund. Section 5. Permissible Bond Fund Investments. As long as the Insurance Policy shall be in effect, the Bond Fund shall be invested only in the following: A. Direct obligations of the United States of America (including obligations issued or held in book-entry form on the books of the Department of the Treasury, and CATS and TIGRS) or obligations the principal of and interest on which are unconditionally guaranteed by the United States of America. -8- B. Bonds, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the following federal agencies and provided such obligations are backed by the full faith and credit of the Untied States of America (stripped securities are only permitted if they have been stripped by the agency itself): 1. U.S. Export-Import Bank (Eximbank) Direct obligations or fully guaranteed certificates of beneficial ownership 2. Farmers Home Administration (FmHA) Certificates of Beneficial Ownership 3. Federal Financing Bank 4. Federal Housing Administration Debentures (FHA) 5. General Services Administration Participation Certificates 6. Government National Mortgage Association (GNMA or Ginnie Mae) GNMA - guaranteed mortgage-backed bonds GNMA - guaranteed pass-through obligations (these obligations are not acceptable for certain cash flow sensitive issues) 7. U.S. Maritime Administration Guaranteed Title XI financing 8. U.S. Department of Housing and Urban Development (HUD) Project Notes Local Authority Bonds New Communities Debentures - U.S. government guaranteed debentures U.S. Public Housing Notes and Bonds - U.S. government guaranteed public housing notes and bonds C. Bonds, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the following federal agencies which are not backed by the full faith and credit of the United States of America (stripped -9- securities are only permitted if they have been stripped by the agency itself): 1. Federal Home Loan Bank System Senior debt obligations 2. Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac) Participation Certificate Senior debt obligations 3. Federal National Mortgage Association (FNMA or Fannie Mae) Mortgage-backed securities and senior debt obligations 4. Student Loan Marketing Association (SLMA or Sallie Mae) Senior debt obligations 5. Resolution Funding Corp. (REFCORP) obligations 6. Farm Credit System Consolidated systemwide bonds and notes D. Money market funds registered under the Federal Investment Company Act of 1940, whose shares are registered under the Federal Securities Act of 1933, and having a rating by S&P of AAAm-G; AAA-m; or AA-m and if rated by Moody's rated Aaa, Aal or Aa2. E. Certificates of deposit secured at all times by collateral described in (A) and/or(B) above. Such certificates must be issued by commercial banks, savings and loan associations or mutual savings banks. The collateral must be held by a third party and the bondholders must have a perfected first security interest in the collateral. F. Certificates of deposit, savings accounts, deposit accounts or money market deposits which are fully insured by FDIC, including BIF and SAIF. G. Investment Agreements, including GIC's, Forward Purchase Agreements and Reserve Fund Put Agreements acceptable to XLCA. -10- H. Commercial paper rated, at the time of purchase, "Prime -1" by Moody's and "A-1" or better by S&P. Bonds or notes issued by any state or municipality which are rated by Moody's and S&P in one of the two highest rating categories assigned by such rating agencies. J. Federal funds or bankers acceptances with a maximum term of one year of any bank which has an unsecured, uninsured and unguaranteed obligation rating of"Prime - 1" or "A3" or better by Moody's and "A-l" or "A" or better by S&P. K. Repurchase Agreements ("Repos") for 30 days or less must follow the following criteria. Repos which exceed 30 days must be acceptable to XLCA (criteria available upon request). Repos provide for the transfer of securities from a dealer bank or securities firm (seller/borrower) to a municipal entity (buyer/lender), and the transfer of cash from a municipal entity to the dealer bank or securities firm with an agreement that the dealer bank or securities firm will repay the cash plus a yield to the municipal entity in exchange for the securities at a specified date. 1. Repos must be between the municipal entity and a dealer bank or securities firm. a. Primary dealers on the Federal Reserve reporting dealer list which are rated A or better by S&P and A2 or better by Moody's, or b. Banks rated "A" or better by S&P and A2 or better by Moody's. 2. The written repurchase agreement must include the following: a. Securities which are acceptable for transfer are: (1) Direct obligations of the United States of America referred to in Section A above, or -11- (2) Obligations of federal agencies referred to in Section B above (3) Obligations of FNMA and FHLMC b. The term of the Repos may be up to 30 days. c. The collateral must be delivered-to the municipal entity, trustee (if trustee is not supplying the collateral) or third party acting as agent for the trustee is (if the trustee is supplying the collateral) before/simultaneous with payment (perfection by possession of certificated securities). d. Valuation of Collateral. (1) the securities must be valued weekly, marked- to-market at current market price plus accrued interest. (2) The value of collateral must be equal to 104% of the amount of cash transferred by the municipal entity to the dealer bank or security firm under the repo plus accrued interest. If the value of securities held as collateral slips below 104% of the value of the cash transferred by the municipal entity, then additional cash and/or acceptable securities must be transferred. If, however, the securities used as collateral are FNMA or FHLMC, then the value of collateral must equal 105%. 3. A legal opinion which must be delivered to the municipal entity that states that the Repo meets guidelines under state law for legal investment of public funds. L. Any state administered pool investment fund in which the issuer is statutorily permitted or required to invest will be deemed a permitted investment. Section 6. Bond Details, Execution and Redemption. (a) Bond Details. General Obligation Bonds of the City in the amount of -12- $1,900,000, shall be issued pursuant to the provisions of Sections 384.25 and 384.24(3)(q) of the City Code of Iowa for the aforesaid purpose. The Bonds shall be designated "GENERAL OBLIGATION BOND, TAXABLE SERIES 2006B", be dated June 1, 2006, and bear interest from the date thereof, until payment thereof, at the office of the Paying Agent, said interest payable on December 1, 2006, and semiannually thereafter on the 1st day of June and December in each year until maturity at the rates hereinafter provided. The Bonds shall be executed by the manual or facsimile signature of the Mayor and attested by the manual or facsimile signature of the Clerk, and impressed or printed with the seal of the City and shall be fully registered as to both principal and interest as provided in this Resolution; principal, interest and premium, if any, shall be payable at the office of the Paying Agent by mailing of a check to the registered owner of the Bond. The Bonds shall be in the denomination of$5,000 or multiples thereof. The Bonds shall mature and bear interest as follows: Interest Principal Maturity Rate Amount June 1st 5.625% $105,000 2009 5.625 105,000 2010 5.625 115,000 2011 5.625 125,000 2012 5.625 130,000 2013 5.625 135,000 2014 5.625 140,000 2015 5.650 150,000 2016 5.700 160,000 2017 5.700 170,000 2018 5.750 175,000 2019 5.800 190,000 2020 5.850 200,000 2021 (b) Redemption. Bonds maturing after June 1, 2014 may be called for redemption by the Issuer and paid before maturity on said date or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. -13- Thirty days' notice of redemption shall be given by first class mail to the registered owner of the Bond. Failure to give such notice by mail to any registered owner of the Bonds or any defect therein shall not affect the validity of any proceedings for the redemption of the Bonds. All bonds or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. If selection by lot within a maturity is required, the Registrar shall designate the bonds to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of bonds to be called has been reached. Section 7. Issuance of Bonds in Book-Entry Form; Replacement Bonds. (a) Notwithstanding the other provisions of this Resolution regarding registration, ownership, transfer, payment and exchange of the Bonds, unless the Issuer determines to permit the exchange of Depository Bonds for Bonds in the Authorized Denominations, the Bonds shall be issued as Depository Bonds in denominations of the entire principal amount of each maturity of Bonds (or, if a portion of said principal amount is prepaid, said principal amount less the prepaid amount); and such Depository Bonds shall be registered in the name of Cede & Co., as nominee of DTC. Payment of semi-annual interest for any Depository Bond shall be made by wire transfer or New York Clearing House or equivalent next day funds to the account of Cede & Co. on the interest payment date for the Bonds at the address indicated in or pursuant to the Representation Letter. (b) With respect to Depository Bonds, neither the Issuer nor the Paying Agent shall have any responsibility or obligation to any Participant or to any Beneficial Owner. Without limiting the immediately preceding sentence, neither the Issuer nor the Paying Agent shall have any responsibility or obligation with respect to (i) the accuracy of the records of DTC or its nominee or of any Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any Participant, any Beneficial Owner or any other person, other than DTC or its nominee, of any notice with respect to the Bonds, (iii) the payment to any Participant, any Beneficial Owner or any other person, other than DTC or its nominee, of any amount with respect to the principal of, premium, if any, or interest on the Bonds, or(iv) the failure of DTC to provide any information or notification on behalf of any Participant or Beneficial Owner. The Issuer and the Paying Agent may treat DTC or its nominee as, and deem DTC or its nominee to be, the absolute owner of each Bond for the purpose of payment of the principal of, premium, if any, and interest on such Bond, for the purpose of all other -14- matters with respect to such Bond, for the purpose of registering transfers with respect to such Bonds, and for all other purposes whatsoever (except for the giving of certain Bondholder consents, in accordance with the practices and procedures of DTC as may be applicable thereto). The Paying Agent shall pay all principal of, premium, if any, and interest on the Bonds only to or upon the order of the Bondholders as shown on the Registration Books, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's obligations with respect to the principal of, premium, if any, and interest on the Bonds to the extent so paid. Notwithstanding the provisions of this Resolution to the contrary (including without limitation those provisions relating to the surrender of Bonds, registration thereof, and issuance in Authorized Denominations), as long as the Bonds are Depository Bonds, full effect shall be given to the Representation Letter and the procedures and practices of DTC thereunder, and the Paying Agent shall comply therewith. (c) Upon (i) a determination by the Issuer that DTC is no longer able to carry out its functions or is otherwise determined unsatisfactory, or (ii) a determination by DTC that the Bonds are no longer eligible for its depository services or (iii) a determination by the Paying Agent that DTC has resigned or discontinued its services for the Bonds, the Issuer shall (A) designate a satisfactory substitute depository as set forth below or, if a satisfactory substitute is not found, (B) provide for the exchange of Depository Bonds for replacement Bonds in Authorized Denominations. (d) If the Issuer determines to provide for the exchange of Depository Bonds for Bonds in Authorized Denominations, the Issuer shall so notify the Paying Agent and shall provide the Registrar with a supply of executed unauthenticated Bonds to be so exchanged. The Registrar shall thereupon notify the owners of the Bonds and provide for such exchange, and to the extent that the Beneficial Owners are designated as the transferee by the owners, the Bonds will be delivered in appropriate form, content and Authorized Denominations to the Beneficial Owners, as their interests appear. (e) Any substitute depository shall be designated in writing by the Issuer to the Paying Agent. Any such substitute depository shall be a qualified and registered "clearing agency" as provided in Section 17A of the Securities Exchange Act of 1934, as amended. The substitute depository shall provide for (i) immobilization of the Depository Bonds, (ii) registration and transfer of interests in Depository Bonds by book entries made on records of the depository or its nominee and (iii) payment of principal of, premium, if any, and interest on the Bonds in accordance with and as such interests may appear with respect to such book entries. Section 8. Registration of Bonds; Appointment of Registrar; Transfer; Ownership; -15- Delivery; and Cancellation. (a) Registration. The ownership of Bonds may be transferred only by the making of an entry upon the books kept for the registration and transfer of ownership of the Bonds, and in no other way. Wells Fargo Bank, National Association is hereby appointed as Bond Registrar under the terms of this Resolution and under the provisions of a separate agreement with the Issuer filed herewith which is made a part hereof by this reference. Registrar shall maintain the books of the Issuer for the registration of - ownership of the Bonds for the payment of principal of and interest on the Bonds as provided in this Resolution. All Bonds shall be negotiable as provided in Article 8 of the Uniform Commercial Code and Section 384.31 of the Code of Iowa, subject to the provisions for registration and transfer contained in the Bonds and in this Resolution. (b) Transfer. The ownership of any Bond may be transferred only upon the Registration Books kept for the registration and transfer of Bonds and only upon surrender thereof at the office of the Registrar together with an assignment duly executed by the holder or his duly authorized attorney in fact in such form as shall be satisfactory to the Registrar, along with the address and social security number or federal employer identification number of such transferee (or, if registration is to be made in the name of multiple individuals, of all such transferees). In the event that the address of the registered owner of a Bond (other than a registered owner which is the nominee of the broker or dealer in question) is that of a broker or dealer, there must be disclosed on the Registration Books the information pertaining to the registered owner required above. Upon the transfer of any such Bond, a new fully registered Bond, of any denomination or denominations permitted by this Resolution in aggregate principal amount equal to the unmatured and unredeemed principal amount of such transferred fully registered Bond, and bearing interest at the same rate and maturing on the same date or dates shall be delivered by the Registrar. (c) Registration of Transferred Bonds. In all cases of the transfer of the Bonds, the Registrar shall register, at the earliest practicable time, on the Registration Books, the Bonds, in accordance with the provisions of this Resolution. (d) Ownership. As to any Bond, the person in whose name the ownership of the same shall be registered on the Registration Books of the Registrar shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of the principal of any such Bonds and the premium, if any, and interest thereon 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, including the interest thereon, to the extent of the sum or sums so paid. -16- (e) Cancellation. All Bonds which have been redeemed shall not be reissued but shall be cancelled by the Registrar. All Bonds which are cancelled by the Registrar shall be destroyed and a certificate of the destruction thereof shall be furnished promptly to the Issuer; provided that if the Issuer shall so direct, the Registrar shall forward the cancelled Bonds to the Issuer. (f) Non-Presentment of Bonds. In the event any payment check representing payment of principal of or interest on the Bonds is returned to the Paying Agent or if any bond is not presented for payment of principal at the maturity or redemption date, if funds sufficient to pay such principal of or interest on Bonds shall have been made available to the Paying Agent for the benefit of the owner thereof, all liability of the Issuer to the owner thereof for such interest or payment of such Bonds shall forthwith cease, terminate and be completely discharged, and thereupon it shall be the duty of the Paying Agent to hold such funds, without liability for interest thereon, for the benefit of the owner of such Bonds who shall thereafter be restricted exclusively to such funds for any claim of whatever nature on his part under this Resolution or on, or with respect to, such interest or Bonds. The Paying Agent's obligation to hold such funds shall continue for a period equal to two years and six months following the date on which such interest or principal became due, whether at maturity, or at the date fixed for redemption thereof, or otherwise, at which time the Paying Agent, shall surrender any remaining funds so held to the Issuer, whereupon any claim under this Resolution by the Owners of such interest or Bonds of whatever nature shall be made upon the Issuer. (g) Registration and Transfer Fees. The Registrar may furnish to each owner, at the Issuer's expense, one bond for each annual maturity. The Registrar shall furnish additional bonds in lesser denominations (but not less than the minimum denomination) to an owner who so requests. Section 9. Reissuance of Mutilated, Destroyed, Stolen or Lost Bonds. In case any outstanding Bond shall become mutilated or be destroyed, stolen or lost, the Issuer shall at the request of Registrar authenticate and deliver a new Bond of like tenor and amount as the Bond so mutilated, destroyed, stolen or lost, in exchange and substitution for such mutilated Bond to Registrar, upon surrender of such mutilated Bond, or in lieu of and substitution for the Bond destroyed, stolen or lost, upon filing with the Registrar evidence satisfactory to the Registrar and Issuer that such Bond has been destroyed, stolen or lost and proof of ownership thereof, and upon furnishing the Registrar and Issuer with satisfactory indemnity and complying with such other reasonable regulations as the Issuer or its agent may prescribe and paying such expenses as the Issuer may incur in connection therewith. -17- Section 10. Record Date. Payments of principal and interest, otherwise than upon full redemption, made in respect of any Bond, shall be made to the registered holder thereof or to their designated agent as the same appear on the books of the Registrar on the 15th day preceding the payment date. All such payments shall fully discharge the obligations of the Issuer in respect of such Bonds to the extent of the payments so made. Payment of principal shall only be made upon surrender of the Bond to the Paying Agent. Section 11. Execution, Authentication and Delivery of the Bonds. Upon the adoption of this Resolution, the Mayor and Clerk shall execute and deliver the Bonds to the Registrar, who shall authenticate the Bonds and deliver the same to or upon order of the Purchaser. No Bond shall be valid or obligatory for any purpose or shall be entitled to any right or benefit hereunder unless the Registrar shall duly endorse and execute on such Bond a Certificate of Authentication substantially in the form of the Certificate herein set forth. Such Certificate upon any Bond executed on behalf of the Issuer shall be conclusive evidence that the Bond so authenticated has been duly issued under this Resolution and that the holder thereof is entitled to the benefits of this Resolution. No Bonds shall be authenticated and delivered by the Registrar unless and until there shall have been provided the following: 1. A certified copy of the Resolution of Issuer authorizing the issuance of the Bonds; 2. A written order of Issuer signed by the City Treasurer of the Issuer directing the authentication and delivery of the Bonds to or upon the order of the Purchaser upon payment of the purchase price as set forth therein; 3. The approving opinion of Ahlers & Cooney, P.C., Bond Counsel, concerning the validity and legality of all the Bonds proposed to be issued. Section 12. Right to Name Substitute Paying Agent or Registrar. Issuer reserves the right to name a substitute, successor Registrar or Paying Agent upon giving prompt written notice to each registered bondholder. -18- Section 13. Form of Bond. Bonds shall be printed in substantial compliance with standards proposed by the American Standards Institute substantially in the form as follows: (6) (6) (7) (8) (1) (2) (3) (4) (5) (9) (9a) (10) (Continued on the back of this Bond) (11)(12)(13) (14) (15) FIGURE 1 (Front) -19- 1'1 V lJ 1\1: G (Back) -20- The text of the Bonds to be located thereon at the item numbers shown shall be as follows: Item 1, figure 1 = "STATE OF IOWA" "COUNTY OF BLACK HAWK" "CITY OF WATERLOO" "GENERAL OBLIGATION BOND" "TAXABLE SERIES 2006B" Item 2, figure 1 = Rate: Item 3, figure 1 = Maturity: Item 4, figure 1 = Bond Date: June 1, 2006 Item 5, figure 1 = Cusip No.: Item 6, figure 1 = "Registered" Item 7, figure 1 = Certificate No. Item 8, figure 1 = Principal Amount: $ Item 9, figure 1 = The City of Waterloo, Iowa, a municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of Iowa (the "Issuer"), for value received, promises to pay from the source and as hereinafter provided, on the maturity date indicated above, to Item 9A, figure 1 = (Registration panel to be completed by Registrar or Printer with name of Registered Owner). Item 10, figure 1 = or registered assigns, the principal sum of(principal amount written out) THOUSAND DOLLARS in lawful money of the United States of America, on the maturity date shown above, only upon presentation and surrender hereof at the office of Wells Fargo Bank, National Association, Paying Agent of this issue, or its successor, with interest on said sum from the date hereof until paid at the rate per annum specified above, payable on December 1, 2006, and semiannually thereafter on the 1st day of June and December in each year. Interest and principal shall be paid to the registered holder of the Bond as shown on the records of ownership maintained by the Registrar as of the 15th day preceding such interest payment date. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. THE ISSUER DOES NOT INTEND OR REPRESENT THAT THE INTEREST ON THE BONDS WILL BE EXCLUDED FROM GROSS INCOME FOR FEDERAL -21- INCOME TAX PURPOSES, AND THE ISSUER IS NOT OBLIGATED TO TAKE ANY ACTION TO ATTEMPT TO SECURE ANY SUCH EXCLUSION. THE HOLDER OF THIS BOND THEREFORE SHOULD TREAT THE INTEREST THEREON AS BEING SUBJECT TO FEDERAL INCOME TAXATION. STATEMENT OF INSURANCE XL Capital Assurance Inc. ("XLCA"); New York, New York, has delivered its municipal bond insurance policy (the "Policy") with respect to the scheduled payments due of principal of and interest on this Bond, to Wells Fargo Bank, National Association, Des Moines, Iowa, or its successor, as paying agent (the "Paying Agent") for the City of Waterloo, Iowa, General Obligation Bonds, Taxable Series 2006B. Said Policy is on file and available for inspection at the principal office of the Paying Agent and a copy thereof may be obtained from XLCA or the Paying Agent. This Bond is issued pursuant to the provisions of Sections 384.25 and 384.24(3)(q) of the City Code of Iowa, for the purpose of paying costs of the acquisition, construction and improvement of real and personal property useful for the protection of property from floods or high waters, including flood control and drainage improvements; the construction, reconstruction and repairing of street, sidewalk and intersection improvements; the improvement and repair of bridges; the acquisition, construction and installation of storm sewer and sanitary sewer improvements; the acquisition of vehicles and capital equipment for the Police, Fire Rescue and Street Departments; the acquisition, rehabilitation and demolition of abandoned, dilapidated or dangerous buildings; the rehabilitation and improvement of City parks and the acquisition, repair and replacement of facilities, equipment and improvements commonly found in City parks, including bikeway development, tennis court improvements and mowing equipment; and the acquisition, improvement and installation of traffic control devices, signage, fixtures and equipment, including traffic signal and street light improvements; and the acquisition and improving of the automated GIS/GPS mapping system; the aiding in the planning, undertaking and carrying out of urban renewal project activities under Chapter 403 of the Code of Iowa, as amended, and the Urban Renewal Plans for the San Marron Urban Renewal Area, the Logan Tax Increment Redevelopment Area and the Rath Tax Increment Redevelopment Area, including consulting fees and other planning expenses, property acquisitions and clearance for public and private redevelopment, and incentive payments relating to the acquisition and private redevelopment of properties within such areas; the reconstruction, remodeling, improvement and repairing of City buildings and facilities, including the Five Sullivan Brothers Center, Young Arena, Police Department, Fire Stations, and Public Library; the reconstruction, renovation and improvement of the Riverfront Stadium, swimming pools and sports facilities; and improvements to the -22- Center for the Arts, in conformity to a Resolution of the Council of said City duly passed and approved. Unless this certificate is presented by an authorized representative of The Depository Trust Company, a limited purpose trust company ("DTC"), to the Issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of DTC (and any payment is-made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. Bonds maturing after June 1, 2014 may be called for redemption by the Issuer and paid before maturity on said date or any date thereafter, from any funds regardless of source, in whole or from time to time in part, in any order of maturity and within an annual maturity by lot. The terms of redemption shall be par, plus accrued interest to date of call. Thirty days' notice of redemption shall be given by first class mail to the registered owner of the Bond. Failure to give such notice by mail to any registered owner of the Bonds or any defect therein shall not affect the validity of any proceedings for the redemption of the Bonds. All Bonds or portions thereof called for redemption will cease to bear interest after the specified redemption date, provided funds for their redemption are on deposit at the place of payment. If selection by lot within a maturity is required, the Registrar shall designate the Bonds to be redeemed by random selection of the names of the registered owners of the entire annual maturity until the total amount of Bonds to be called has been reached. Ownership of this Bond may be transferred only by transfer upon the books kept for such purpose by Wells Fargo Bank, National Association, the Registrar. Such transfer on the books shall occur only upon presentation and surrender of this Bond at the office of the Registrar as designated below, together with an assignment duly executed by the owner hereof or his duly authorized attorney in the form as shall be satisfactory to the Registrar. Issuer reserves the right to substitute the Registrar and Paying Agent but shall, however, promptly give notice to registered bondholders of such change. All Bonds shall be negotiable as provided in Article 8 of the Uniform Commercial Code and Section 384.31 of the Code of Iowa, subject to the provisions for registration and transfer contained in the Bond Resolution. -23- And it is hereby represented and certified that all acts, conditions and things requisite, according to the laws and Constitution of the State of Iowa, to exist, to be had, to be done, or to be performed precedent to the lawful issue of this Bond, have been existent, had, done and performed as required by law; that provision has been made for the levy of a sufficient continuing annual tax on all the taxable property within the territory of the Issuer for the payment of the principal and interest of this Bond as the same will respectively become due; that the faith, credit, revenues and resources and all the real and personal property of the Issuer are irrevocably pledged for the prompt payment hereof, both principal and interest; and the total indebtedness of the Issuer including this Bond, does not exceed the constitutional or statutory limitations. IN TESTIMONY WHEREOF, the Issuer by its Council, has caused this Bond to be signed by the manual signature of its Mayor and attested by the manual signature of its City Clerk, with the seal of said City impressed hereon, and to be authenticated by the manual signature of an authorized representative of the Registrar, Wells Fargo Bank, National Association, Des Moines, Iowa. Item 11, figure 1 = Date of authentication: Item 12, figure 1 = This is one of the Bonds described in the within mentioned Resolution, as registered by Wells Fargo Bank, National Association. WELLS FARGO BANK, NATIONAL ASSOCIATION, Registrar By: Authorized Signature Item 13, figure 1 = Registrar and Transfer Agent: Wells Fargo Bank, National Association Paying Agent: Wells Fargo Bank, National Association SEE REVERSE FOR CERTAIN DEFINITIONS Item 14, figure 1 = (Seal) Item 15, figure 1 = [Signature Block] CITY OF WATERLOO, IOWA -24- By: (manual signature) Mayor ATTEST: By: (manual signature) City Clerk Item 16, figure 2 = [Assignment Block] [Information Required for Registration] ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto (Social Security or Tax Identification No. ) the within Bond and does hereby irrevocably constitute and appoint attorney in fact to transfer the said Bond on the books kept for registration of the within Bond, with full power of substitution in the premises. Dated (Person(s) executing this Assignment sign(s) here) SIGNATURE ) GUARANTEED) IMPORTANT - READ CAREFULLY The signature(s) to this Power must correspond with the name(s) as written upon the face of the certificate(s) or bond(s) in every particular without alteration or enlargement or any change whatever. Signature guarantee must be provided in accordance with the prevailing standards and procedures of the Registrar and Transfer Agent. Such standards and procedures may require signature to be guaranteed by certain eligible guarantor institutions that participate in a recognized signature guarantee program. INFORMATION REQUIRED FOR REGISTRATION OF TRANSFER -25- Name of Transferee(s) Address of Transferee(s) Social Security or Tax Identification Number of Transferee(s) Transferee is a(n): Individual* Corporation Partnership Trust - *If the Bond is to be registered in the names of multiple individual owners, the names of all such owners and one address and social security number must be provided. The following abbreviations, when used in the inscription on the face of this Bond, shall be construed as though written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common IA UNIF TRANS MIN ACT- Custodian (Cust) (Minor) under Iowa Uniform Transfers to Minors Act (State) ADDITIONAL ABBREVIATIONS MAY ALSO BE USED THOUGH NOT IN THE ABOVE LIST Section 15. Contract Between Issuer and Purchaser. This Resolution shall constitute a contract between said City and the purchaser of the Notes. Section 16. Continuing Disclosure. The Issuer hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate, and the provisions of the Continuing Disclosure Certificate are hereby incorporated by reference as part of this Resolution and made a part hereof. Notwithstanding any other provision of this Resolution, failure of the Issuer to comply with the Continuing Disclosure Certificate shall not be considered an event of default under this Resolution; however, any holder of the Notes or Beneficial Owner may take -26- such actions as may be necessary and appropriate, including seeking specific performance by court order, to cause the Issuer to comply with its obligations under the Continuing Disclosure Certificate. For purposes of this Section, "Beneficial Owner" means any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Notes (including persons holding Notes through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Notes for federal income tax purposes. Section 17. Standard XLCA Provisions. As long as the Insurance Policy shall be in effect, the following provisions shall apply: A. Notice to XLCA. Any notices required to be given by any party under this Resolution also shall be given to XLCA, Attn: Surveillance. B. Amendments. XLCA's consent shall be required for all amendments to the Resolution and XLCA must be given prior notice of any such amendment. Copies of any amendments to such documents which are consented to by XLCA also shall be sent to S&P. C. Supplemental Legal Document. Not applicable. D. Events of Default. Events of Default under this Resolution shall be defined as follows: 1. the Issuer fails to pay principal when due; 2. the Issuer fails to pay interest when due; 3. the Issuer fails to observe any other covenant or condition of the Resolution and such failure continues for 30 days; and 4. the Issuer declares bankruptcy. E. Remedies. XLCA, acting alone, shall have the right to direct all remedies upon the occurrence of an Event of a Default. XLCA shall be recognized as the owner of each Bond which it insures for the purposes of exercising all rights and privileges available to owners. For Bonds which it insures, XLCA shall have the right to institute any suit, action, or proceeding at law or in equity under the same terms as an owner in accordance with applicable provisions of the Resolution. Other than scheduled sinking fund -27- redemptions, any acceleration of principal payments must be subject to XLCA's prior written consent. F. Defeasance. The following will be permitted investments for purposes of defeasance: 1. Cash. 2. U.S. Treasury Certificates, Notes and Bonds (including State and Local Government Series - (SLGs)). 3. Direct obligations of the U.S. Treasury which have been stripped by the U.S. Treasury itself. 4. Resolution Funding Corp. ("REFCORJP"). Only the interest component of REFCORP strips which have been stripped by request to the Federal Reserve Bank of New York in book entry form are acceptable. 5. Pre-refunded municipal bonds rated "Aaa" by Moody's and "AAA" by S&P. If, however, the issue is only rated by S&P (i.e., there is no Moody's rating) then the pre-refunded bonds must have been pre-refunded with cash, direct U.S. or U.S. guaranteed obligations, or AAA rated pre-refunded municipals to satisfy this condition. 6. Obligations issued by the following agencies which are backed by the full faith and credit of the U.S.: a. U.S. Export-Import Bank (Eximbank) Direct obligations or fully guaranteed certificates of beneficial ownership b. Farmers Home Administration (FmHA) c. Federal Financing Bank d. General Services Administration Participation Certificates -28- e. U.S. Maritime Administration Guaranteed Title XI financing f. U.S. Department of Housing and Urban Development (HUD) Project Notes Local Authority Bonds New Communities Debentures - U.S. government guaranteed debentures U.S. Public Housing Notes and Bonds - U.S. government guaranteed public housing notes and bonds G. Agents. Not applicable. H. XLCA as Third Party Beneficiary. XLCA shall be explicitly recognized as being a third-party beneficiary under this Resolution with the power to enforce any right, remedy or claim conferred, given or granted under such Resolution. I. Subrogation. If principal and/or interest due on the Bonds shall be paid by XLCA, the Bonds shall remain outstanding under the Resolution for all purposes, and shall not be deemed defeased or otherwise satisfied, or paid by the Issuer, and the assignment and pledge of the trust estate and all covenants, agreements and other obligations of the Issuer to the owners shall continue to exist and shall run to the benefit of XLCA, and XLCA shall be subrogated to the rights of such owners. Section 18. Payments Under the Policy. If, on the third Business Day prior to the related scheduled interest payment date or principal payment date ("Payment Date"), there is not on deposit with the Issuer under the Resolution, after making all transfers and deposits required under the Resolution, moneys sufficient to pay the principal of, and interest on, Insured Bonds due on such Payment Date, the Issuer shall give notice to XLCA and to its designated agent (if any) (the "Insurer's Fiscal Agent"), by telephone or telecopy, of the amount of such deficiency by 10:00 a.m., New York City time, on such Business Day. If, on the Business Day prior to the related Payment Date, there is not on deposit with the Paying Agent moneys sufficient to pay the principal of, and interest on, the Insured Bonds due on such Payment Date, the Paying Agent shall make a claim under the Insurance Policy and give notice to XLCA and XLCA's Fiscal Agent (if any) by telephone of the amount of any deficiency in the amount available to pay principal and interest, and the allocation of such deficiency between the amount required to pay interest on the Insured Bonds and the amount required to pay principal of the Insured Bonds, confirmed in writing to the related Insurer and XLCA's Fiscal Agent by 10:00 a.m., New -29- York City time, on such Business Day, by delivering the Notice of Nonpayment and Certificate. For the purposes of the preceding paragraph, "Notice" means telephonic or telecopied notice, subsequently confirmed in a signed writing, or written notice by registered or certified mail, from the Paying Agent to XLCA, which notice shall specify (a) the name of the entity making the claim, (b) the policy number, (c) the claimed amount and (d) the date such claimed amount will become Due for Payment. - "Nonpayment" means the failure of the Issuer to have provided sufficient funds to the Paying Agent for payment in full of all principal of, and interest on, the XLCA Insured Bonds that are Due for Payment. "Due for Payment", when referring to the principal of Insured Bonds, means when the stated maturity date or mandatory redemption date for the application of a required sinking fund installment has been reached and does not refer to any earlier date on which payment is due by reason of call for redemption (other than by application of required sinking fund installments, acceleration or other advancement of maturity, unless XLCA shall elect, in its sole discretion, to pay such principal due upon such acceleration; and when referring to interest on Insured Bonds, means when the stated date for payment of interest has been reached. "Certificate" means a certificate in form and substance satisfactory to XLCA as to the Paying Agent's right to receive payment under the Insurance Policy. The Paying Agent shall designate any portion of payment of principal on Insured Bonds paid by XLCA at maturity on its books as a reduction in the principal amount of Insured Bonds registered to the then current Bondholder, whether DTC or its nominee or otherwise, and shall issue a replacement Insured Bond to XLCA, registered in the name of XLCA, as the case may be, in a principal amount equal to the amount of principal so paid (without regard to authorized denominations); provided that the Paying Agent's failure to so designate any payment or issue any replacement Insured Bond shall have no effect on the amount of principal or interest payable by the Issuer on any Insured Bond or the subrogation rights of XLCA. The Paying Agent shall keep a complete and accurate record of all funds deposited by XLCA into the Policy Payments Account (as hereinafter defined) and the allocation of such funds to payment of interest on and principal paid with respect to any Insured Bond. XLCA shall have the right to inspect such records at reasonable times upon reasonable notice to the Paying Agent. Upon payment of a claim under the Insurance Policy, the Paying Agent shall establish a separate special purpose trust account for the benefit of holders of Insured Bonds referred to herein as the "Policy Payments Account" and over which the Paying -30- Agent shall have exclusive control and sole right of withdrawal. The Paying Agent shall receive any amount paid under Insurance Policy in trust on behalf of holders of Insured Bonds and shall deposit any such amount in the Policy Payments Account and distribute such amount only for purposes of making the payments for which a claim was made. Such amounts shall be disbursed by the Paying Agent to holders of Insured Bonds in the same manner as principal and interest payments are to be made with respect to the Insured Bonds under the sections hereof regarding payment of Insured Bonds. It shall not be necessary for such payments to be made by checks or wire transfers separate-from the check or wire transfer used to pay debt service with other funds available to make such payments. Funds held in the Policy Payments Account shall not be invested by the Paying Agent and may not be applied to satisfy any costs, expenses or liabilities of the Paying Agent. Any funds remaining in the Policy Payments Account following an Insured Bond payment date shall promptly be remitted to XLCA. Section 19. Severability Clause. If any section, paragraph, clause or provision of this Resolution be held invalid, such invalidity shall not affect any of the remaining provisions hereof, and this Resolution shall become effective immediately upon its passage and approval. Section 20. Repeal of Conflicting Resolutions or Ordinances. All ordinances and resolutions and parts of ordinances and resolutions in conflict herewith are hereby repealed. PASSED AND APPROVED this 12th day of June 2006. May r Tim Hurley ATTEST: City Clerk N y Eckert -31- 4 CIG-3 9/91 CERTIFICATE STATE OF IOWA ) ) SS COUNTY OF BLACK HAWK ) I, the undersigned City Clerk of Waterloo, Iowa, do hereby certify that attached is a true and complete copy of the portion of the corporate records of said Municipality showing proceedings of the Council, and the same is a true and complete copy of the action taken by said Council with respect to said matter at the meeting held on the date indicated in the attachment, which proceedings remain in full force and effect, and have not been amended or rescinded in any way; that meeting and all action thereat was duly and publicly held in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the Council and posted on a bulletin board or other prominent place easily accessible to the public and clearly designated for that purpose at the principal office of the Council (a copy of the face sheet of said agenda being attached hereto) pursuant to the local rules of the Council and the provisions of Chapter 21, Code of Iowa, upon reasonable advance notice to the public and media at least twenty-four hours prior to the commencement of the meeting as required by said law and with members of the public present in attendance; I further certify that the individuals named therein were on the date thereof duly and lawfully possessed of their respective city offices as indicated therein, that no Council vacancy existed except as may be stated in said proceedings, and that no controversy or litigation is pending, prayed or threatened involving the incorporation, organization, existence or boundaries of the City or the right of the individuals named therein as officers to their respective positions. WITNESS my hand and the seal of said Municipality hereto affixed this 14th day of June , 2006. Nancy Ecke t City Clerk, Vb rloo, Iowa SEAL DCORNELL\496289.1\W'\113!O074 -33-