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HomeMy WebLinkAbout2004-381-06.14.2004 (This Notice to be posted) NOTICE AND CALL OF PUBLIC MEETING Governmental Body: The City Council of Waterloo, Iowa. Date of Meeting: June 14 , 2004. Time of Meeting: 5 : 3 0 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: $3,825,000 General Obligation Bonds, Taxable Series 2004B • Resolution authorizing the issuance. Such additional matters as are set forth on the additional 29 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. 740-a- City Clerk, Aqj erloo, Iowa Nancy Eckert June 14 , 2004 The City Council of Waterloo, Iowa, met in regular session, in the Council Chambers, City Hall, Waterloo, Iowa, at 5 : 30 o'clock P.M., on the above date. There were present Mayor Tim Hurley , in the chair, and the following named Council Members: Kincaid , Cole , Greenwood , Clark, Schmitt , Gunderson, Welper Absent: none * * * * * * * -1- Council Member Schmitt introduced the following Resolution entitled "RESOLUTION AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF $3,825,000 GENERAL OBLIGATION BONDS, TAXABLE SERIES 2004B, AND LEVYING A TAX TO PAY SAID BONDS" and moved that it be adopted. Council Member Gunderson seconded the motion to adopt, and the roll being called thereon, the vote was as follows: AYES: Kincaid . Cole . Greenwood, Clark, Schmitt, Gunderson, Welper NAYS: none Whereupon, the Mayor declared said Resolution duly adopted as follows: RESOLUTION NO . 2004-381 RESOLUTION AUTHORIZING AND PROVIDING FOR THE ISSUANCE OF $3,825,000 GENERAL OBLIGATION BONDS, TAXABLE SERIES 2004B, AND LEVYING A TAX TO PAY SAID BONDS WHEREAS, the Issuer 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 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 Downtown Waterloo Riverfront Urban Renewal Area, the Airport Tax Increment Redevelopment Area and the Rath Tax Increment Redevelopment Area, including the acquisition of properties, and related demolition and clearance activities, for subsequent private redevelopment and the construction of public improvements within such areas, essential corporate purpose projects, and it is deemed necessary and advisable that the City issue general obligation bonds for said purposes as authorized by Section 384.24(3)(q) of the Code of Iowa; WHEREAS, pursuant to notice published as required by Section 384.24(3)(q), this Council has held a public meeting and hearing upon the proposal to institute proceedings for the issuance of not to exceed $430,000 in principal amount of general obligation bonds for the above described purposes; and no petition was filed in the manner provided -2- by Section 362.4 of the City Code of Iowa, pursuant to the provisions of Section 384.24(3)(q), 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 for such purposes, 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 aiding in the planning, undertaking and carrying out of urban renewal project activities under the authority of Chapter 403 of the Code of Iowa and the Urban Renewal Plan for the Northeast Industrial Area, including those costs associated with the acquisition of real property for private redevelopment, the construction of sanitary sewer, railroad spur and water main improvements and the funding of economic development grants to developers constructing improvements and creating employment opportunities in the Northeast Industrial Area, and it is deemed necessary and advisable that the City issue general obligation bonds for said purposes as authorized by Section 384.24(3)(q) of the Code of Iowa; WHEREAS, pursuant to notice published as required by Section 384.25, this Council has held a public meeting and hearing upon the proposal to institute proceedings for the issuance of not to exceed $4,000,000 in principal amount of general obligation bonds for the above described purposes; and no petition was filed in the manner provided by Section 362.4 of the City Code of Iowa, pursuant to the provisions of Section 384.24(3)(q), 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 for such purposes, 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 is hereby found and determined that certain of general obligation bonds authorized as hereinabove described shall be combined for the purpose of issuance in a single issue of Corporate Purpose 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: -3- 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. • "Bonds" shall mean $3,825,000 General Obligation Bonds, Taxable Series 2004B, 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. • "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. • "Insurer" shall mean MBIA Insurance Corporation, Armonk, New York, as issuer of the Policy. • "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. -4- • • "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. • "Policy" shall mean the Financial Guaranty Insurance Policy issued by the Insurer with respect to the Bonds. • "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 Minneapolis, Minnesota, 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. • "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. 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: $674,460 2005/2006 $382,680 2006/2007 $380,855 2007/2008 $382,855 2008/2009 -5- $388,405 2009/2010 $387,605 2010/2011 $390,620 2011/2012 $392,495 2012/2013 $392,920 2013/2014 $392,240 2014/2015 $395,573 2015/2016 $397,618 2016/2017 $396,188 2017/2018 $402,420 2018/2019 (NOTE: For example the levy to be made and certified against the taxable valuations of January 1, 2004, will be collected during the fiscal year commencing July 1, 2005). (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 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 2004B NO. ONE" (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. -6- 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. Investments of Bond Fund Proceeds. All moneys held in the Bond Fund, provided for by Section 3 of this Resolution shall be invested in investments permitted by Chapter 12B, Code of Iowa, 2003 (formerly Chapter 452, Code of Iowa, as amended) or deposited in financial institutions which are members of the Federal Deposit Insurance Corporation and the deposits in which are insured thereby and all such deposits exceeding the maximum amount insured from time to time by FDIC or its equivalent successor in any one financial institution shall be continuously secured in compliance with the State Sinking Fund provided under Chapter 12C of the Code of Iowa, 2003, as amended or otherwise by a valid pledge of direct obligations of the United States Government having an equivalent market value. All such interim investments shall mature before the date on which the moneys are required for payment of principal of or interest on the Bonds as herein provided. Section 6. Bond Details, Execution and Redemption. (a) Bond Details. General Obligation Bonds of the City in the amount of $3,825,000, 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 2004B", be dated June 1, 2004, and bear interest from the date thereof, until payment thereof, at the office of the Paying Agent, said interest payable on December 1, 2004, 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. -7- 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 3.000% $100,000 2005 3.000 185,000 2006 3.500 195,000 2007 4.000 200,000 2008 4.500 210,000 2009 4.800 225,000 2010 5.100 235,000 2011 5.250 250,000 2012 5.500 265,000 2013 5.600 280,000 2014 5.650 295,000 2015 5.700 315,000 2016 5.800 335,000 2017 5.850 355,000 2018 5.900 380,000 2019 (b) Redemption. Bonds maturing after June 1, 2011 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. -8- 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 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 -9- 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; Delivery; and Cancellation. (a) Registration. The ownership of Bonds maybe 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 -10- 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. (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 -11- 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. 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 -12- 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. -13- 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) -14- (10) (16) (Continued) FIGURE 2 (Back) -15- 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 2004B" Item 2, figure 1 = Rate: Item 3, figure 1 = Maturity: Item 4, figure 1 = Bond Date: June 1, 2004 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, 2004, 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 -16- • 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. 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 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 Downtown Waterloo Riverfront Urban Renewal Area, the Airport Tax Increment Redevelopment Area and the Rath Tax Increment Redevelopment Area, including the acquisition of properties, and related demolition and clearance activities, for subsequent private redevelopment and the construction of public improvements within such areas; and aiding in the planning, undertaking and carrying out of urban renewal project activities under the authority of Chapter 403 of the Code of Iowa and the Urban Renewal Plan for the Northeast Industrial Area, including those costs associated with the acquisition of real property for private redevelopment, the construction of sanitary sewer, railroad spur and water main improvements and the funding of economic development grants to developers constructing improvements and creating employment opportunities in the Northeast Industrial Area, in conformity to a Resolution of the Council of said City duly passed and approved. STATEMENT OF INSURANCE MBIA Insurance Corporation (the "Insurer") has issued a policy containing the following provisions, such policy being on file at Wells Fargo Bank, National Association, Minneapolis, Minnesota. The Insurer, in consideration of the payment of the premium and subject to the terms of this policy, hereby unconditionally and irrevocably guarantees to any owner, as hereinafter defined, of the following described obligations, the full and complete payment required to be made by or on behalf of the Issuer to Wells Fargo Bank, National Association or its successor(the "Paying Agent") of an amount equal to (i) the principal of(either at the stated maturity or by any advancement of maturity pursuant to a mandatory sinking fund payment) and interest on, the Obligations (as that term is defined below) as such payments shall become due but shall not be so paid (except that in the event of any acceleration of the due date of such principal by reason of mandatory or optional redemption or acceleration resulting from default or otherwise, other than any advancement of maturity pursuant to a mandatory sinking fund payment, the payments guaranteed hereby shall be made in such amounts and at such times as such payment of -17- principal would have been due had there not been any such acceleration); and (ii) the reimbursement of any such payment which is subsequently recovered from any owner pursuant to a final judgment by a court of competent jurisdiction that such payment constitutes an avoidable preference to such owner within the meaning of any applicable bankruptcy law. The amounts referred to in clauses (i) and (ii) of the preceding sentence shall be referred to herein collectively as the "Insured Amounts." "Obligations" shall mean: $3,825,000 City of Waterloo, Iowa General Obligation Bonds, Taxable Series 2004B Upon receipt of telephonic or telegraphic notice, such notice subsequently continued in writing by registered or certified mail, or upon receipt of written notice by registered or certified mail, by the Insurer from the Paying Agent or any owner of an Obligation the payment of an Insured Amount for which is then due, that such required payment has not been made, the Insurer on the due date of such payment or within one business day after receipt of notice of such nonpayment, whichever is later, will make a deposit of funds, in an account with U.S. Bank Trust National Association, in New York, New York, or its successor, sufficient for the payment of any such Insured Amounts which are then due. Upon presentment and surrender of such Obligations or presentment of such other proof of ownership of the Obligations, together with any appropriate instruments of assignment to evidence the assignment of the Insured Amounts due on the Obligations as are paid by the Insurer, and appropriate instruments to effect the appointment of the Insurer as agent for such owners of the Obligations in any legal proceeding related to payment of Insured Amounts on the Obligations, such instruments being in a form satisfactory to U.S. Bank Trust National Association, U.S. Bank Trust National Association shall disburse to such owners or the Paying Agent payment of the Insured Amounts due on such Obligations, less any amount held by the Paying Agent for • the payment of such Insured Amounts and legally available therefor. This policy does not insure against loss of any prepayment premium which may at any time be payable with respect to any Obligation. As used herein, the term "owner" shall mean the registered owner of any Obligation as indicated in the books maintained by the Paying Agent, the Issuer, or any designee of the Issuer for such purpose. The term owner shall not include the Issuer or any party whose agreement with the Issuer constitutes the underlying security for the Obligations. -18- Any service of process on the Insurer may be made to the Insurer at its offices located at 113 King Street, Armonk, New York 10504 and such service of process shall be valid and binding. This policy is non-cancellable for any reason. The premium on this policy is not refundable for any reason including the payment prior to maturity of the Obligations. MBIA Insurance Corporation 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, 2011 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 -19- 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. 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, Minneapolis, Minnesota. 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 Wells Fargo Bank, N.A. -20- Corporate Trust Operations MAC N9303-121 P. O. Box 1517 Minneapolis, MN 55480 SEE REVERSE FOR CERTAIN DEFINITIONS Item 14, figure 1 = (Seal) Item 15, figure 1 = [Signature Block] CITY OF WATERLOO, IOWA 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) -2 1- 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 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 -22- ALSO BE USED THOUGH NOT IN THE ABOVE LIST Section 14. 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 Bonds or Beneficial Owner may take 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 Bond (including persons holding Bonds through nominees, depositories or other intermediaries), or(b) is treated as the owner of any Bonds for federal income tax purposes. Section 15. Payments under the Policy. (a) In the event that, on the second Business Day, and again on the Business Day, prior to the payment date on the Bonds, the Paying Agent has not received sufficient moneys to pay all principal of and interest on the Bonds due on the second following or following, as the case may be, Business Day, the Paying Agent shall immediately notify the Insurer or its designee on the same Business Day by telephone or telegraph, confirmed in writing by registered or certified mail, of the amount of the deficiency. (b) If the deficiency is made up in whole or in part prior to or on the payment date, the Paying Agent shall so notify the Insurer or its designee. (c) In addition, if the Paying Agent has notice that any Bondholder has been required to disgorge payments of principal or interest on the Bonds to a trustee in bankruptcy or creditors or others pursuant to a final judgment by a court of competent jurisdiction that such payment constitutes an avoidable preference to such Bondholder within the meaning of any applicable bankruptcy laws, then the Paying Agent shall notify the Insurer or its designee of such fact by telephone or telegraphic notice, confirmed in writing by registered or certified mail. (d) The Paying Agent is hereby irrevocably designated, appointed, directed and authorized to act as attorney-in-fact for Holders of the Bonds as follows: -23- 1. If and to the extent there is a deficiency in amounts required to pay interest on the Bonds, the Paying Agent shall (a) execute and deliver to U.S. Bank Trust National Association, or its successors under the Policy (the "Insurance Paying Agent"), in form satisfactory to the Insurance Paying Agent, an instrument appointing the Insurer as agent for such Holders in any legal proceeding related to the payment of such interest and an assignment to the Insurer of the claims for interest to which such deficiency relates and which are paid by the Insurer, (b) receive as designee of the respective Holders (and not as Paying Agent) in accordance with the tenor of the Policy payment from the Insurance Paying Agent with respect to the claims for interest so assigned, and (c) disburse the same to such respective Holders; and 2. If and to the extent of a deficiency in amounts required to pay principal of the Bonds, the Paying Agent shall (a) execute and deliver to the Insurance Paying Agent in form satisfactory to the Insurance Paying Agent an instrument appointing the Insurer as agent for such Holder in any legal proceeding relating to the payment of such principal and an assignment to the Insurer of any of the Bonds surrendered to the Insurance Paying Agent of so much of the principal amount thereof as has not previously been paid or for which moneys are not held by the Paying Agent and available for such payment (but such assignment shall be delivered only if payment from the Insurance Paying Agent is received), (b) receive as designee of the respective Holders (and not as Paying Agent) in accordance with the tenor of the Policy payment therefor from the Insurance Paying Agent, and (c) disburse the same to such Holders. (e) Payments with respect to claims for interest on and principal of Bonds disbursed by the Paying Agent from proceeds of the Policy shall not be considered to discharge the obligation of the Issuer with respect to such Bonds, and the Insurer shall become the owner of such unpaid Bonds and claims for the interest in accordance with the tenor of the assignment made to it under the provisions of this subsection or otherwise. (f) Irrespective of whether any such assignment is executed and delivered, the Issuer and the Paying Agent hereby agree for the benefit of the Insurer that: 1. They recognize that to the extent the Insurer makes payments, directly or indirectly (as by paying through the Paying Agent), on account of principal of or interest on the Bonds, the Insurer will be subrogated to the rights of such Holders to receive the amount of such principal and interest from the Issuer, -24- with interest thereon as provided and solely from the sources stated in this Resolution and the Bonds; and 2. They will accordingly pay to the Insurer the amount of such principal and interest (including principal and interest recovered under subparagraph (ii) of the first paragraph of the Policy, which principal and interest shall be deemed past due and not to have been paid), with interest thereon as provided in this Resolution and the Bond, but only from the sources and in the manner provided herein for the payment of principal of and interest on the Bonds to Holders, and will otherwise treat the Insurer as the owner of such rights to the amount of such principal and interest. (g) In connection with the issuance of additional Bonds, the Issuer shall deliver to the Insurer a copy of the disclosure document, if any, circulated with respect to such additional Bonds. (h) Copies of any amendments made to the documents executed in connection with the issuance of the Bonds which are consented to by the Insurer shall be sent to Standard & Poor`s Corporation. (i) The Insurer shall receive notice of the resignation or removal of the Paying Agent and the appointment of a successor thereto. (j) The Insurer shall receive copies of all notices required to be delivered to Bondholders and, on an annual basis, copies of the Issuer's audited financial statements and Annual Budget. Notices: Any notice that is required to be given to a Holder of the Bonds or to the Paying Agent pursuant to the Resolution shall also be provided to the Insurer. All notices required to be given to the Insurer under the Resolution shall be in writing and shall be sent by registered or certified mail addressed to MBIA Insurance Corporation, 113 King Street, Armonk, New York 10504 Attention: Surveillance. (k) The Issuer agrees to reimburse the Insurer immediately and unconditionally upon demand, to the extent permitted by law, for all reasonable expenses, including attorneys' fees and expenses, incurred by the Insurer in connection with (i) the enforcement by the Insurer of the Issuer`s obligations, or the preservation or defense of any rights of the Insurer, under this Resolution and any other document executed in connection with the issuance of the Bonds, and (ii) any consent, amendment, waiver or other action with respect to the Resolution or any related document, whether or not -25- • granted or approved, together with interest on all such expenses from and including the date incurred to the date of payment at Citibank's Prime Rate plus 3% or the maximum interest rate permitted by law, whichever is less. In addition, the Insurer reserves the right to charge a fee in connection with its review of any such consent, amendment or waiver, whether or not granted or approved. (1) The Issuer agrees not to use the Insurer's name in any public document including, without limitation, a press release or presentation, announcement or forum without the Insurer's prior consent; provided, however, such prohibition on the use of the Insurer's name shall not relate to the use of the Insurer's standard approved form of disclosure in public documents issued in connection with the Bonds to be issued in accordance with the terms of the Insurer's commitment and provided further that such prohibition shall not apply to the use of the Insurer's name in order to comply with public notice, public meeting or public reporting requirements. (m). The Issuer shall not enter into any agreement nor shall it consent to or participate in any arrangement pursuant to which Bonds are tendered or purchased for any purpose other than the redemption and cancellation or legal defeasance of such Bonds without the prior written consent of MBIA. Section 16. Other Provisions Relating to the Policy. (a) Any notices required to be given by the Issuer under this Resolution shall also be given to the Insurer, Attention: Insured Portfolio Management. (b) The Insurer shall be given notice of any amendments to this Resolution that do not require the consent of the Holders, such as those which cure ambiguities, correct formal defects or add to the security of the financing. The Insurer's consent is required for all other amendments which require the consent of the Holders. Copies of any amendments which are consented to by the Insurer shall be sent to Standard & Poor's. (c) Reserved. (d) In the event (i) the Issuer fails to pay principal when due, (ii) the Issuer fails to pay interest when due, (iii) the Issuer fails to observe any other covenant or condition of this Resolution and such failure continues for at least thirty days following notice thereof or(iv) the Issuer declares bankruptcy, the Insurer, acting alone, shall have the right to direct all remedies. The Insurer shall be recognized as the registered owner of each Bond for the purposes of exercising all rights and privileges available to the Holders of the Bonds. The Insurer shall have the right to institute any suit, action or proceeding at law or in equity under the same terms as a Bondholder in accordance with the provisions -26- of this Resolution. Other than the redemption of the Bonds described in Section 6, any acceleration of principal payments must be subject to the Insurer's prior written consent. (e) Any defeasance of the Bonds shall require the deposit of: (i) cash, (ii) US Treasury certificates, notes and bonds (including State and Local Government Series - "SLGS"), (iii) direct obligations of the U.S. Treasury which have been stripped by the Treasury itself(CATS, TIGRS and similar securities), (iv) Resolution Funding Corp. (REFCORP) strips, the interest component of which have been stripped by request by the Federal Reserve Bank of New York in book entry form, (v) pre-refunded municipal bonds rated "Aaa" by Moody's" and "AAA" by S&P (if, however, the issue is only rated by S&P, 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), or (vi) obligations issued by the following agencies which are backed by the full faith and credit of the U.S.: U.S. Export-Import Bank (direct obligations or fully guaranteed certificates of beneficial ownership), Farmers Home Administration (certificates of beneficial ownership), Federal Financing Bank, General Services Administration (participation certificates), U.S. Maritime Administration (guaranteed Title XI financing), U.S. Department of Housing and Urban Development (project notes, local authority bonds, new communities debentures - U.S. government guaranteed debentures, and U.S. public housing notes and bonds - U.S. government guaranteed public housing notes and bonds). In connection with any advance refunding of the Bonds, the Insurer will be entitled to receive fifteen Business Days notice of any advance refunding of the Bonds and an accountant's report with respect to the sufficiency of the amounts deposited in escrow to defease the Bonds. (f) Reserved. (g) In connection with any current refunding of the Bonds, (i) the period between closing on the refunding bonds and redemption of the Bonds shall not exceed 60 days, (ii) the proceeds of the refunding issue shall be sufficient to redeem the Bonds without reinvestment income, (iii) should the proceeds be invested, such investments shall mature in an amount and at such time so that sufficient cash will be available to effect the redemption, which shall be confirmed to the Insurer in writing, and (iv) investments, to be held in a fiduciary account, must be limited to cash, direct obligations of the U.S. Treasury or money market funds registered under the Federal Investment Company Act of 1940, who shares are registered under the Federal Securities Act of 1933, and have a rating by S&P of AAAm-G or AAAm. If the money market fund has been rated by Moody's, it must be rated Aaa as well. Investments in money market funds shall be limited to not more than ten days. -27- Section 17. Contract Between Issuer and Purchaser. This Resolution constitutes a contract between said City and the purchaser of the Bonds. Section 18. 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 19. Repeal of Conflicting Resolutions or Ordinances. That all ordinances and resolutions and parts of ordinances and resolutions in conflict herewith are hereby repealed. PASSED AND APPROVED this 14 t h day of June , 2004. Mayor Tim Hurley ATTEST: City Cle Na Eckert -28- 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 16 t h day of June , 2004. City Clerk, terloo, Iowa Nancy Eckert SEAL DCORNELL\413954\1\11310070 -29-