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TC Ord. No. 1987-08ORDINANCE NO. 87-8, SERIES OF 1987 AN ORDINANCE. TO CONTRACT AN INDEBTEDNESS OF THE TOWN OF AVON, COLORADO, BY AUTHORIZING,THE ISSUANCE OF THE TOWN'S GENERAL. OBLIGATION BONDS, SERIES 1987, IN THE AGGREGATE PRINCIPAL AMOUNT OF $2,040,000; PROVIDING FOR THE LEVY OF GENERAL -AD VALOREM TAXES TO THE EXTENT NECESSARY TO PAY THE PRINCIPAL OF AND INTEREST ON-THE-BONDS; PROVIDING DETAILS'CONCERNING THE BONDS AND FUNDS APPERTAINING THERETO; RATIFYING ACTION PREVIOUSLY TAKEN CONCERNING' SAID BONDS; AND REPEALING ALL ORDINANCES IN CONFLICT HEREWITH. WHEREAS, the Town of Avon (the "Town") in the County of Eagle and State of Colorado, is a municipal corporation duly organized and existing under the Town's Charter (the 'Charter") adopted pursuant to Article XX of the Constitution of the State of Colorado; and WHEREAS, Section 14.3 of the Charter provides: "'Section 14.3 General Obligation Bonds. (a) No bonds or other evidence of indebtedness payable in whole, or in part from the proceeds of general property taxes and/or sales taxes and/or other municipal taxes, or to which the full faith and credit of the Town is pledged, shall be issued, except in pursuance of an ordinance adopted and approved by two- thirds (2/3) vote of the entire Council, or until the question of their issuance shall, at a general or special election, be submitted to a vote of the electors and approved by a majority of those voting on the question. (b) The Council shall determine which of the aforementioned methods of approval of such securities shall be utilized subject to the limitations- of subsection 14:3 (c) below. (c) Pursuant to subsection (a) above, the Council may, without-voter approval, issue- such securities in amounts not to exceed a total cumulative outstanding bonded indebtedness of the Town -in the amount of $5,000,000.00. (d) General obligation bonds issued for acquiring water and rights thereto, or acquiring, improving or -3- • extending a Town water system or sewer system or any combination of such purposes may be so issued without an election and upon a vote of approval-by a. majority of two-thirds (2/3) vote of the entire Council, without the restrictions contained in this section. (e) The provisions of this Section shall not apply to Short-Term Notes, Revenue Bonds, Refunding Bonds nor Special or Local Improvement District Bonds, which are provided for elsewhere in this Charter.0; and WHEREAS, Section 14.7 of the Charter further provides: OSection 14.7 Limitation of Indebtedness. The aggregate amount of bonds or other evidences of indebtedness of the Town shall not exceed twenty- five percent (25%) of the assessed valuation of the taxable property within the Town as shown by the last preceding assessment for Town purposes; or the sum of $15,000,000.00, whichever amount shall be greater provided, however, in determining the amount of indebtedness, there shall not be included within the computation: (a) Bonds -or other evidences of indebtedness, outstanding or authorized to be issued for the acquisition, extension or improvement of a municipal water-works system or municipal storm sewer, sanitary sewer, combined storm and sanitary sewers, or sewage disposal systems; (b) Short-term notes; (c) Special or local improvement securities; (d) Securities payable from the revenues of an income-producing system, utility, project, or other capital improvements or from Town sales or use taxes. (e) Long term installment contracts other than real property _acquisitio.is,' rentals and leaseholds pursuant to Section 14.9.", and WHEREAS, the Town has heretofore issued $1,885,000 of bonds authorized pursuant to Section 14.3(c) of the Charter. of which there are currentl-r outstanding $1,770,000; and -4- "WHEREAS, the assessed valuation of the taxable property within the Town as of the first day of January, 1987 is $23,995,620 and the limitation on indebtedness pursuant to_ Section 14.7 is $15,000,000; and WHEREAS, the Town Council of the Town (the "Councils) has determined and hereby determines that the present and future needs of the Town require the acquisition of land and improvements for the purpose of providing public. parking facilities (the °Projects); and WHEREAS, the Council has determined, and hereby determines,- that the proposal (the sProposals) submitted by Boettcher & Company, Inc., Denver, Colorado (the sPurchasers), for the purchase of the general obligation bonds herein authorized, is to the best advantage of the Town, the proposal being for the purchase of such bonds at a price equal to 97.5% of the principal amount thereof and accrued interest to the delivery date, and otherwise on the terms herein provided; and WHEREAS, forms of the following documents have been presented to the Council: (i) the Proposal; (ii),Registrar- Agreement dated as of May 15, 1987, between the Town and United Bank of Denver National Association; (iii) Acquisition Fund Escrow Agreement dated as of May 15, 1987 (the sAcquisition Escrow Agreements) among the Town, Palmer Development Company, and United Bank of Denver National Association (the sBanks); and (iv) Preliminary Official Statement dated April 14, 1987. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO: Section 1. Ratification. All actions heretofore taken, not inconsistent with the provisions of this ordinance, by the Council and the officers and agents of the Town, directed toward the Project and toward the issuance of the Town's general obligation bonds therefor, are hereby ratified, approved and confirmed. The Town hereby accepts the Proposal of the Purchaser for the purchase of the Town's general obligation bonds as herein provided. -5- Section 2. Authorization. For the purpose of providing, funds to defray in whole or in part the costs of the Project, the Town shall issue its general obligation bonds, designated as the "Town of Avon, Colorado, General Obligation Bonds, Series 198711 (the "bonds"), in the aggregate principal amount of $2-,040,000. Section 3. Bond Details. The bonds shall be issued in fully registered form in denominations of $5,000 and integral multiples thereof (provided that no bond may be in a denomination which exceeds the principal coming due on any maturity date and no individual bond will be issued for more than one maturity).. The bonds shall be numbered in such manner as shall be determined by United Bank of Denver National Association, Denver, Colorado, being the registrar and paying agent (the "Registrar") for the bonds. The bonds shall be dated May 15, 1987, and shall bear interest from their date to maturity at the rates per annum set forth below, payable semiannually on June 1 and December 1 in each year, commencing December 1, 1987, except, that bonds which are reissued upon transfer, exchange or other replacement shall bear interest at such rates from the most recent interest payment: date to which interest has been paid, or if no interest has been paid, from the date of the bonds. The bonds, shall mature serially on December 1 in each of the years and amounts set forth below: Amounts Years Interest Rates Maturing Maturing (Per Annum) $ 60,000 1989 5.75% 65,000 1990 6.00% 70,000 1991 6.25% 70,000 1992 6.50% 75,000 1993 6.75% 80,000 1994 7.00% 85,000 1995 7.15% 95,000 1996 7.30% 100,000 1997 7.40% 485,000 2001 7.75% 855,000 2006 8.00% -6- • 0 The principal of and premium, if any, on any bond shall be payable -to the- registered owner thereof as shown on the registration records kept by the Registrar upon maturity or prior redemption thereof and upon presentation and surrender at the principal corporate trust office of the Registrar. If any bond shall not be paid upon such presentation and surrender at or after maturity or prior redemption, it shall continue to draw interest at the rate borne by said bond until the principal thereof is paid in full. Payment of interest on any bond shall be made to the registered owner thereof by check or draft mailed by the Registrar, on or before each interest payment date (or, if such interest payment date is not a business day, on or before the next succeeding business day), to the registered owner thereof at his address as it last appears on the registration records kept by the Registrar at the close of business on the fifteenth day (whether or not a business day) of the calendar month next preceding an interest payment date (the "Record Date"); but any such interest not so-timely paid or duly provided for shall cease to be payable to the person who is the registered owner thereof at the close of business on the Record Date and shall be payable to the person who is the registered owner thereof at the close of business on a Special Record Date for the payment of any such defaulted interest. Such Special Record Date shall be-fixed by the Registrar whenever moneys become available for payment of the defaulted interest, and notice of the Special Record Date shall be given by the Registrar to the registered owners of the bonds not less than ten days prior to the Special Record Date by first-class mail to each such registered owner as shown on the Registrar's registration records on a date selected by the Registrar, stating the date of the Special Record Date and the date fixed for the payment of such defaulted interest. The Registrar may make payments of interest on any bond by such -alternative means as may be mutually agreed to between the owner of such bond and the Registrar (provided, however, that the Town shall not be required to make funds available to the Registrar -7- earlier than the date specified in the Registrar Agreement). All such payments shall be made in lawful money of the United States of'America, without deduction for the services of the Registrar. Section 4. Prior Redemption. A. The bonds maturing on and before December 1, 1992 shall not be subject to redemption prior to their respective maturities. The bonds maturing on and after December 1, 1993 shall be subject to prior redemption at the option of the Town in whole, or in part, in integral multiples of $5,000, in inverse order of maturity and by lot within a maturity in such manner as the Registrar shall determine (giving proportionate weight to bonds in denominations larger than $5,000), on December 1, 1992 or on any interest payment date thereafter, at the following redemption prices (expressed as a percentage of principal amount of each bond or portion thereof so redeemed) on the following dates plus accrued interest to the redemption date: Redemption Dates (Inclusive) Redemption Prices December 1, 1992 through June 11 1994 101.0% December 1, 1994 through June 1, 1996 100.5% December 1, 1996 and thereafter 100.0% B. The bonds maturing on December. 1, 2001 are subject to mandatory sinking fund redemption at a price equal to the principal amount thereof plus accrued interest to the redemption date.* Bonds subject to mandatory sinking fund 'redemption shall be selected by lot in integral multiples of $5,000 in such manner as the Registrar shall determine (giving due consideration to bonds in denominations larger than $5,000). As and for a sinking fund for the redemption of the bonds maturing on December 1, 2001 the Town will deposit in the Bond Fund (created in Section 11 hereof) on or before December 1, -8- 1998, and on or before each December 1 thereafter through December 1, 2000, a sum which 'together with other moneys available in the Bond Fund is sufficient to redeem (after credit as provided below) on the following dates-the following principal amounts of the bonds maturing on December 1, 2001: Sinking Fund Principal Payment Date Amount December 1, 1998 $110,000- December 1, 1999 115,000 December 1, 2000 125,000 The remaining $135,000 of the bonds maturing on December 1, 2001 shall be paid upon presentation and surrender at maturity unless redeemed pursuant to optional redemption prior to maturity. The bonds maturing on December 1, 2006 are subject to mandatory sinking fund redemption at a price equal to the principal amount thereof plus accrued interest to the redemption date. Bonds subject to mandatory sinking fund redemption shall be selected by lot in integral multiples of $5,000 in such manner as the - Registrar shall determine (giving due consideration to bonds in denominations larger than $5,000). As and for a sinking fund for the redemption of the bonds maturing on December 1, 2006 the Town will deposit in the Bond Fund (created in Section 11 hererof) on or before December 1, 2002, 'and on or before each December 1 thereafter through December 1, 2005, a sum which together with other moneys available in the Bond Fund is sufficient to redeem (after credit as provided below) on the following dates the following principal amounts of the bonds maturing on December 1, 2006: Sinking Fund Payment Date Principal Amount -9- December 1, 2002 $145,000 December i, 2003 155,000 December 1, 2004 170,000 December 1, 2005 185,000 The remaining $200,000 of the bonds maturing on December 1, 2006 shall be paid upon presentation and surrender at maturity unless redeemed pursuant to optional redemption prior to maturity. On or before the thirtieth day prior to each such sinking fund payment date, the Registrar shall proceed to call. the bonds indicated above (or any bond or bonds issued to replace such Bonds) for redemption from such sinking fund on such sinking, fund payment date, and give notice of such call without further instruction or notice from the Town. At its option, to be exercised on or before the sixtieth day next preceding each such sinking fund redemption date, the Town may (i) deliver to the Registrar for cancellation =bonds subject to mandatory sinking fund redemption' in an aggregate principal amount desired or (ii) receive' a credit in respect of its sinking fund redemption obligation for any bonds subject to mandatory sinking fund redemption, which prior to said date have been redeemed (otherwise than through the operation of the sinking fund) and cancelled by the Registrar and not theretofore applied as a credit against any sinking 'fund redemption obligation. Each bond so delivered or previously redeemed will be credited by the Registrar at the principal amount thereof on the obligation of the Town on.such sinking fund redemption date and the principal amount of bonds to be redeemed by operation of such sinking fund on such date will be accordingly reduced. The Town will on or before the sixtieth day next preceding each sinking fund redemption date furnish the Registrar with its certificate indicating whether or not and to what extent the provisions of (i) and (ii) of the preceding sentence are to be availed with respect to such sinking fund payment. Failure of the Town to deliver such certificate shall -10- not affect the Registrar's duty to give notice of sinking fund redemption.as provided in this paragraph B. C. If the Town determines to abandon the Project on or before November 1, 1987, the bonds shall be subject to extraordinary prior redemption at the option of the Town, in whole from unexpended proceeds of the bonds and other available moneys of the Town (other than the proceeds of refunding obligations of the Town), on December 1, 1987, at a price equal to the principal amount of the bonds so redeemed and accrued interest to the redemption date. D. In the case of bonds of a denomination larger than $5,000, a portion of such bond ($5,000 or any integral multiple thereof) may be redeemed, in which case the Registrar shall, without charge to the owner of such bond, authenticate and issue a replacement bond or bonds for the unredeemed portion thereof. E. Notice of redemption shall be given by the Registrar in the name of the Town, by sending a copy of such notice by first-class postage prepaid mail, not more than sixty nor less than fifteen days prior to the redemption date, to the Purchaser and to each registered owner of any bond, all or a portion of which is called for prior redemption, at his address as it last appears on the registration records kept by the Registrar. Failure to give such notice by mailing to the registered owner of any bond or to the Purchaser, or any defect therein, shall not affect the validity of the proceedings for the redemption of any other bonds. Such notice shall identify the bonds or portions thereof to be redeemed (if less than all are to be redeemed) and the date fixed for redemption, and shall further state that on such redemption date the principal' amount thereof and the designated premium thereon will become due and payable at the Registrar, and that from and after such date interest will cease to accrue. Accrued interest to the redemption date will be.paid by check or draft mailed to the registered owner (or by alternative means if so agreed to by the Registrar and the -11- registered owner). Notice having been given in the manner hereinabove provided, the bond or bonds so called for redemption shall become due. and payable on the redemption date so designated; and upon presentation thereof at the Registrar, 'the Town will pay the principal of and premium, if any, on the bond or bonds so called for redemption. Section 5. Negotiability. Subject to the registration provisions hereof, the bonds shall be fully negotiable and shall have all the qualities of negotiable paper, and the owner, or owners thereof shall possess all rights enjoyed by the holders or owners of negotiable instruments under the provisions of the Uniform Commercial Code-Investment Securities. The principal of and interest on the bonds shall be paid, and the bonds shall be transferable, free from and without regard to any equities between the-Town and the original or any intermediate owner of any bonds or any setoffs or cross-claims. The bonds shall constitute the general obligations of the Town and the full faith and credit of the Town shall be and hereby is pledged' to the payment thereof. Section 6. Execution and Authentication. The bonds shall be. executed in the name and on behalf of the Town by the- signature of the Mayor, shall be sealed with a manual or facsimile impression of the seal of the Town and shall be attested by the signature of the Town Clerk. The signatures. of the Mayor and the Town Clerk may be by manual or facsimile signature. The bonds bearing the manual or facsimile signatures of the officers in office at the time of the signing thereof shall be the valid and binding obligations of the Town (subject to the requirement of authentication by the Registrar as hereinafter provided), notwithstanding that before the delivery thereof and payment therefor or before the issuance of the bonds upon transfer or exchange, any or all.of the persons whose manual or facsimile signatures appear thereon shall have ceased to fill their respective offices. The Mayor and the Town Clerk shall, by the execution of a signature certificate pertaining to the bonds, -12- adopt - as and for their respective signatures any facsimiles thereof appearing on the bonds. At the time of the execution of the signature certificate, the Mayor and the Town Clerk may each adopt as and for his or her facsimile signature the facsimile signature of his or her predecessor in office in the event that such facsimile signature appears upon any of the bonds. No bond shall be valid or obligatory for any purpose unless the certificate of authentication, substantially in the form hereinafter provided, has been duly manually executed by the Registrar. The Registrar's certificate of authentication shall be deemed to have been duly executed by the Registrar if manually signed by the Registrar or, in the case of any successor registrar, an authorized officer of the successor registrar, but it shall not be necessary that the same officer sign the certificate of authentication on all of the bonds issued hereunder. Section 7. Registration, Transfer and Exchange of Bonds. A. Books for the registration and transfer of the bonds shall be kept by the Registrar, which is hereby appointed by the Town as registrar (i.e., transfer agent) for the bonds. Upon the surrender for transfer of any bond at the office of the Registrar, duly endorsed for transfer or accompanied by an assignment duly executed by the registered owner or his attorney duly authorized in writing, the Registrar shall enter such transfer on the registration records and shall authenticate_ and deliver in the name of the transferee or transferees a new bond or bonds of a like aggregate principal amount and of the same maturity, bearing a number or numbers not previously assigned. Bonds.may be exchanged at the office of the Registrar for an equal-aggregate principal amount of bonds of the same maturity of other authorized denominations. The Registrar shall authenticate and deliver a bond or bonds which the registered owner making the exchange is entitled to receive, bearing a number or numbers not previously assigned. The Registrar may.impose reasonable charges in connection with such exchanges and transfers of bonds, which -13- charges (as well as any tax or other governmental charge required to be paid with respect to such exchange or transfer) shall be paid by the bond owner requesting such exchange or transfer; provided, however, that the initial registration of the bonds shall be without charge to the Purchaser or such transferee. B. The Registrar shall not be required to transfer or exchange (1) all or any portion of any-bond subject to prior redemption during the period beginning at-the opening of business fifteen days before the day of the mailing,of notice calling any bonds for prior redemption as herein provided and ending at the close of business on the day of such mailing, or (2) all or any portion of a bond after the mailing of notice calling such bond or any portion thereof for prior redemption, except for the unredeemed portion of bonds being redeemed in part. C. The person in whose name any bond shall be registered on the registration records kept by the Registrar shall-be deemed and regarded as the absolute owner thereof for the purpose of making payment thereof and for all other purposes except as may otherwise be provided with respect to payment of interest as is provided in Section 3 hereof; and payment of or on account of either principal or interest on any bond shall be made only to or upon the written order of the registered owner thereof or his legal representative, but such registration may be changed upon transfer of such bond in the manner" and subject to'the conditions and limitations provided herein. All such payments 'shall be valid and effectual to discharge the liability upon such bond to the extent of the sum or sums so paid. D. If any bond shall be lost, stolen, destroyed or mutilated, the Registrar shall, upon receipt of such evidence, information and indemnity relating thereto as it and the Town may reasonably. require, authenticate and deliver a replacement bond or bonds of a like aggregate principal amount and of the same maturity, bearing a number or numbers not previously assigned. If' such lost, stolen, destroyed or mutilated bond shall have matured or is about to become due and payable, the-Registrar may -14- 0 0 -pay such bond in lieu.of replacement.- The bond owner requesting such replacement or,payment shall be required to pay all expenses in connection therewith. E. The officers of the Town are authorized to deliver to the Registrar fully executed but unauthenticated bonds in such quantities as may be convenient to be held in custody by the Registrar pending use as herein provided. F. Whenever any bond shall be surrendered to the Registrar upon payment thereof or for transfer, exchange or replacement as provided herein, such bond shall be promptly cancelled by the Registrar, and counterparts of a certificate of such cancellation shall be furnished by the Registrar to the Town. Section 8. Form of Bonds, Certificates, and Registration Panel. The bonds, Registrar's certificate' of authentication, form of assignment, and legal,opinion certificate shall be in substantially the following forms (provided that any of the text may, with appropriate references, be printed on the back of the bonds), with such omissions, insertions, endorsements and variations as to any recitals of fact or other provisions as may be required by the circumstances, be required or permitted by this ordinance, or be consistent with this ordinance and necessary or appropriate to conform to the rules and,requirements of any governmental authority or any usage or requirement of law with respect thereto: -15- 9 (Form of Bond) STATE OF COLORADO No. R INTEREST RATE REGISTERED OWNER: PRINCIPAL AMOUNT: UNITED STATES OF AMERICA COUNTY OF EAGLE TOWN OF AVON GENERAL OBLIGATION BOND SERIES 1987 MATURITY DATE DATED CUSIP May 15, 1987 DOLLARS The Town of Avon (the "Town"), in the County of Eagle and State of Colorado, for value received, hereby acknowledges itself indebted and hereby promises to pay to the registered owner specified above, or registered assigns, the principal amount specified above, on the maturity date specified above ,(unless called for earlier redemption), and interest thereon payable on June 1 and December 1 in each year, commencing December 1, 1987, at the interest rate per annum specified above, until the principal sum is paid or payment has been provided therefor. This bond will bear interest from the most recent interest payment date to which interest. has been paid or, if no interest has been paid, from the date of this bond. The principal of and premium, if any, on this bond are payable upon presentation and surrender hereof at the principal corporate trust- office of the Town's registrar or its successor (the -16- "Registrar") presently being United Bank of Denver National Association, in Denver, Colorado. Interest on this bond will be paid on or before each interest payment date (or, if such interest payment date is not a business day, on or before the next. succeeding business day), by check or draft mailed to the person in whose name this bond is registered (the "registered owner") in the registration records of the Town maintained by the Registrar and at the address appearing thereon at the close of business on the fifteenth day of the calendar month (whether or not a business day) next preceding such interest payment date (the "Record Date"). Any such interest not so timely paid shall cease to be payable to the person who is the registered owner hereof at the close of business on the Record Date and shall be payable to the person who is the registered owner hereof at the close of, business on a Special Record Date, as described in the ordinance of the Town authorizing the issuance of this bond (the "Bond. Ordinance"), for the payment of any defaulted interest.- Such Special Record Date shall be fixed by the Registrar whenever moneys become available for payment of the defau-lted interest, and notice of the Special Record Date shall be. given to the registered owners of the bonds of the series of which this is one (the "bonds") not less than ten days prior thereto. Alternative means of payment of interest may be used if mutually agreed to between the owner of any bond and the Registrar, as provided in the Bond Ordinance. All such payments shall be made in lawful money of the United States of America without deduction for the services of the Registrar. The bonds maturing on and before December 1, 1992 are not subject to redemption prior to their respective maturities. The bonds maturing on and after December 1, 1993 are subject to prior redemption at the option of the Town in whole or in part, in integral multiples of $5,000, in inverse order of maturity and by lot within a maturity in such manner as the Registrar shall determine (giving proportionate weight to bonds in denominations larger than $5,000), on December 1, 1992 or on any interest -17- payment date thereafter, at the following redemption prices (expressed as a percentage of principal amount of each, bond or portion thereof so redeemed) on the following dates, plus accrued interest to the-redemption date: Redemption Dates (Inclusive) Redemption Prices December 1, 1992 through June 1, 1994 101.0% December 1, 1994 through June 1, 1996 100.5% December 1, 1996 and thereafter 100.0% Bonds of the series of which this bond is a part maturing on December 1, 2001 (the 02001 Term Bonds") are subject to mandatory sinking fund redemption in the manner provided in the Bond Ordinance at a price equal to the principal amount thereof ;plus accrued interest to the redemption date. The 2001 Term Bonds shall be selected for mandatory sinking fund redemption by lot in integral multiples of $5,000 in such manner as the Registrar shall determine (giving due consideration to Bonds in denominations -larger than $5,000). As and for a sinking fund for the redemption of the 2001 Term Bonds the Town will deposit in the Bond Fund (as definedlin the Bond Ordinance) on or before December 1, 1998 and .on or before each December 1 thereafter through December 1,-2000 a sum which together with other moneys available in the Bond Fund is sufficient to redeem (after credit as provided below) on the following dates the following principal amounts of the 2001 Term Bonds: -18- i i Sinking Fund Principal Payment Date i Amount December 1, 1998 $110,000 December 1, 1999 115,000 December 1, 2000 125,000 The remaining $135,000 of the 2001 Term Bonds shall be paid upon presentation and surrender at maturity on December 1, 2001 unless redeemed pursuant to optional redemption prior to maturity. Bonds of the series of which this bond is a part maturing on December 1, 2006 (the 02006 Term Bonds") are subject to mandatory sinking fund redemption in the manner provided in the Bond Ordinance at a price equal to the principal amount thereof plus accrued interest to the redemption date. The 2006 Term Bonds shall be selected for mandatory sinking fund redemption by lot in integral multiples of $5,000 in such manner as the Registrar shall determine (giving due consideration to Bonds in denominations larger than $5,000). As and for a sinking fund for the redemption of the 2006 Term Bonds the Town will deposit in the Bond Fund (as defined in the Bond Ordinance) on or before December 1, 2002 and on or before each December 1 thereafter through December 1, 2005 a sum which together with other moneys available in the Bond Fund is sufficient to redeem (after credit as provided below) on the following dates the following principal amounts of the 2006 Term Bonds: Sinking Fund Principal Payment Date Amount December 1, 2002 $145,000 December 1, 2003 155,000 December 1, 2004 170,000 December 1, 2005 185,000 The remaining $200,000 of the 2006 Term 'Bonds shall be paid upon presentation and surrender at maturity on December 1, 2006 unless redeemed pursuant to optional redemption prior to maturity. -19- On or before the thirtieth day prior to each such sinking fund payment date, the Registrar will proceed to call the bonds indicated above (or any bond or bonds issued to replace such bonds) for redemption from such sinking fund on such sinking fund payment date, and give notice of such call. The Town is entitled to certain credits against its sinking fund redemption obligation in the manner and upon the conditions provided in the Bond Ordinance. If the Town determines to abandon the Project (as defined in the Bond Ordinance) on or before November 1, 1987, the bonds shall be.subject to extraordinary prior redemption at the option of the Town, in whole from unexpended proceeds of the bonds and other available moneys of the Town (other than the proceeds of refunding obligations of the Town) on December 1, 1987, at a price equal to the principal amount of the bonds so redeemed and accrued interest to the redemption date. In the case of bonds of a denomination larger' than $5,000, a portion of such bond ($5,000 or any integral multiple thereof) may be redeemed, in which case the Registrar shall, without charge to the owner of such bond, authenticate and issue-' a replacement bond or bonds for the unredeemed portion thereof. Redemption shall be made upon not more than sixty days and not less than fifteen days mailed notice to the original purchasers and'to each registered owner as shown on the registration records kept by the Registrar, in the manner and upon the conditions provided in the Bond Ordinance. The bonds are issuable only as fully registered bonds- in denominations of $5,000 and integral multiples thereof and are exchangeable for fully registered bonds of the same maturity in equal aggregate principal amounts and in authorized denominations at the aforesaid office of the Registrar, but only in the manner, subject to the limitations and conditions, and upon payment of the charges provided in the Bond Ordinance. This bond is fully transferable by the registered owner hereof in person or by his duly authorized attorney on the -20- • registration records kept.by the Registrar upon surrender of this bond together with a duly executed written instrument of transfer satisfactory to the Registrar. Upon such transfer a new fully registered bond or bonds of authorized denomination or denominations of the same aggregate principal amount and maturity will be issued to the transferee. in exchange for this bond, subject to such terms and conditions and upon payment of such charges as set forth in the Bond Ordinance. The Town and the Registrar may deem and treat the person in whose name this bond is registered as the absolute owner hereof for the purpose of making payment and for all other purposes, except to the extent otherwise provided herein and in the Bond Ordinance with respect ta,the Record Dates and Special Record Dates for the payment of interest. The Registrar will not be required to transfer or exchange-(i) all or any portion of any bond subject to.prior redemption during the period beginning at the opening of business fifteen days before the day of the mailing of notice calling any bonds for prior redemption and ending at the close of business on the, day of such mailing, or (ii) all or any portion of. a bond after the mailing of notice calling such bond or any portion- thereof for prior redemption, except for the unredeemed portion of bonds being redeemed in part. This bond is issued by the Town Council of the Town for purposes of defraying in whole or in part the costs of providing public parking facilities, under the authority of and in full conformity with the Charter of the Town and the Constitution and laws of the State of Colorado, and pursuant to an ordinance of the Town duly adopted, published and made a law of the Town, all prior to the issuance of this bond. It is hereby certified and recited that all the requirements of law have been fully complied with by the proper Town.officers in the issuance of this bond; that the total debt of the Town, including that of this bond, does not exceed any limit of indebtedness prescribed by the Charter of the Town and -21- the Constitution or laws of the State of Colorado; and that provision ,.has been made for the levy and collection of annual taxes on all of the taxable property in the Town sufficient to pay the interest on-and the principal of this bond when the same become due. For the purposes of Section 265(b)(3)(B) of the Internal Revenue Code of 1986, as amended, the Town has designated the bonds, in the Bond Ordinance, as qualified tax-. exempt obligations. Therefore, banks and other financial institutions are not subject to the loot disallowance rule (but remain subject to the 20% interest disallowance rule) under the Internal Revenue Code of 1986, as in existence on the date of delivery of the bonds, related to the ownership of the bonds.' The full faith -and credit of the Town are hereby pledged for the punctual payment of the. principal of and the interest on this bond. This bond shall not be valid or obligatory for any purpose until the Registrar shall have manually signed the certificate of authentication hereon. IN TESTIMONY WHEREOF, the Town Council of the Town of Avon has caused this bond to be signed and executed in its name with a manual or facsimile signature of the Mayor of the Town and to be signed, executed and attested with a manual or facsimile signature of the Town Clerk of the Town, with a manual- or facsimile impression of the seal of. the Town affixed hereto, all as of the date specified above. -22- (Manual 6r-Facsimile Signature) Mayor (MANUAL OR FACSIMILE SEAL) Attest: (Manual or Facsimile Signature) Town Clerk (End of Form of Bond) -23- U (Form of Registrar's Certificate of Authentication) Date of Authentication and Registration: This is one of the bonds described in the within- mentioned Bond Ordinance, and this bond has been duly registered on the registration records kept by the undersigned as Registrar for such bonds. UNITED BANK OF DENVER NATIONAL ASSOCIATION, as Registrar By: Authorized Signature (End of Form of Registrar's Certificate of Authentication) -24- (Form of Assignment) For value received, the undersigned hereby sells, assigns and-transfers unto the within bond and hereby irrevocably constitutes and appoints attorney, to transfer the same on the records of the Registrar, with full power of substitution in the premises. Dated: Signature Guaranteed: Address-of transferee: Social Security or other tax identification number of transferee: NOTE: The signature to this Assignment'must,correspond with the name as written on the face of the within bond in every particular, without alteration or enlargement or any change whatsoever. (End-of Form of Assignment) -25- (Form of Legal Opinion Certificate) STATE OF COLORADO ) COUNTY OF.EAGLE ) SS. TOWN OF AVON ) LEGAL OPINION CERTIFICATE I, the undersigned Town Clerk of the Town of Avon, in the County of Eagle and State of Colorado, do hereby certify that the fallowing approving legal opinion of Sherman & Howard, Attorneys at Law, Denver, Colorado: (Insert text of legal opinion] is a true, perfect and complete copy of a manually- executed and dated copy thereof -on file in the records of the Town in my office; that a manually executed and dated copy of the opinion was forwarded to a representative of the original purchasers for retention. in their records; and that the opinion was dated and issued as of the' date of the delivery of and payment for the bonds of the series of which this is one. IN WITNESS WHEREOF, I have caused to be hereunto set my manual or facsimile signature. (Manual or Facsimile Signature) Town Clerk (End of Form of Legal Opinion Certificate) -26- Section 9. Delivery of Bonds. When the bonds have been duly executed, and authenticated, -the Town Manager shall deliver them, at one time or from time to time, to the Purchaser, on receipt of the agreed purchase price. The Registrar shall initially register the bonds in such name or names as the -Purchaser shall direct, and the bonds shall be initially delivered in such authorized denominations as the Purchaser shall direct. The funds raised thereby shall be applied solely to the purpose aforesaid and for no other purpose whatsoever, but the Purchaser in no manner shall be responsible for the application or disposal by the Town or any of its officers of any of the funds derived from the sale of the bonds. Section 10. Disposition of Bond Proceeds. The net proceeds of the bonds-shall be applied in the following manner. A. First, there shall be deposited in the Bond Fund created in Section 11 hereof and maintained by the Town the accrued interest on the bonds and $216,000 as capitalized interest to pay a portion of the interest on the bonds through December 11 1988. B. Second, there shall be credited to the following special account, hereby created and established with the Bank and designated as the Town of Avon Acquisition Fund Escrow Account (the "Acquisition Escrow Account"), an amount of $1,650,000 which shall.be expended in accordance with the terms of the Acquisition Escrow Agreement. C. Third, the balance of the net proceeds shall be applied for the purpose of paying, together with any other money made 'available therefor, other costs of the Project and the incidental expenses incurred by the Town as a part of the cost of the Project and relating to the Bonds. Section 11. Payment of Principal and Interest - Tax Levy. For the purpose of providing the necessary funds to meet the principal and interest thereafter accruing on the bonds, as the same become due, there shall be levied on all the ,taxable property* in the Town, in addition to all other taxes, direct -27- i annual taxes sufficient in amount to pay the interest and principal promptly as the same, respectively,. become due, and such taxes when collected shall be deposited in a special fund to be kept separate and apart from other accounts and to be known as the vTown of Avon, Colorado, General Obligation Bonds,. Series 1987, Bond Fund,p such fund to be applied solely for-the purpose of the payment of the interest on and the principal of the bonds, respectively, and for no other purpose whatever until the indebtedness so contracted under this ordinance, both principal and interest, shall have been fully paid, satisfied and discharged. Nothing herein shall be so construed as to prevent the Town from applying any other funds available for that purpose to the payment of such interest or principal as the same, respectively, mature; and upon such payments, the levy or levies herein provided may thereupon to that extent be diminished. The sums produced by- the levies hereinabove provided to meet the interest on the bonds and to discharge the principal thereof when due are hereby applied for that purpose, and such amounts for each year shall be included in the annual budget - and appropriation ordinances or other measures to be adopted and passed by the Council in each year. Section 12. Tax Levy. It shall be the duty of the Council, annually, at the time and in the manner provided by law for levying other Town taxes, if such action shall be necessary to effectuate the provisions of this ordinance, to ratify and carry out the provisions hereof with reference to the levying and collection of taxes; and the Council shall require the officers of and for the Town to levy, extend and collect such taxes in'the manner provided by law for the purpose of creating,a fund for the payment of the principal of the bonds and interest thereon, and such taxes, when collected, shall be kept for and applied only to the payment of the interest and principal of the bonds as .hereinabove specified. Section 13. Covenants. A. The Town hereby covenants for the benefit of the Purchaser and the registered owners of the -28- bonds from time to time that it will not make any use of the proceeds of the bonds, any funds reasonably expected to be used to pay the principal of or interest on the bonds, or any other funds of the Town, and' will not make any use of any facilities. financed with the proceeds of the bonds which would cause the interest on the bonds to become subject to federal. income taxation under the Internal Revenue Code of 1986, as in effect on the date of delivery of the bonds (the "Code") (except for the alternative minimum tax. imposed on corporations by Section 55 of the Code and except for the environmental tax imposed on corporations by Section 59A of the Code) or subject to any penalties under Section 148 of the Code, and that it will not take any action or omit to take any action with respect to the bonds, the proceeds thereof or any facilities financed thereby if such action or omission would cause the interest on the bonds to become subject to federal income taxation under the Code (except for the alternative minimum tax imposed on corporations by Section 55 of the Code and except for the environmental tax imposed on corporations by Section 59A of the Code) or subject to any penalties under Section 148 of the Code. The foregoing covenants shall remain in full force and effect notwithstanding the defeasance of the bonds pursuant to Section 15 hereof or any other provision hereof until the date which is 60 days after the final maturity date or earlier prior redemption date thereof. B. For the purposes of Section 265(b)(3)(B) of the' Code, the Town hereby designates the bonds as qualified tax- exempt obligations. C. The Town further hereby covenants for the benefit of the-Purchaser and the registered owners of the bonds from time to time that the Town will annually prepare or cause to be prepared a budget and an.audit report, and will annually file or cause to be filed with the appropriate agency of the State of Colorado a copy of its adopted budget, its appropriation ordinance' and its audit report, all in accordance with the then applicable laws-of the State of.Colorado. -29- Section 14. Successor Registrar. If the Registrar initially appointed hereunder shall resign, or if the Town shall reasonably determine that said Registrar has become incapable of performing the duties hereunder, the Town may, upon notice mailed to each owner of any bond at his address last shown on the registration records, appoint a successor Registrar. No resignation or dismissal of the Registrar may take effect until a successor is appointed. Every such successor Registrar shall be a bank or trust company located in the State of Colorado. Section 15. Defeasance. When the bonds have been fully paid both as to principal, premium, if any, and interest-, all obligations hereunder shall be discharged, and the bonds shall no longer be deemed to be outstanding for any purpose of this ordinance. Payment of the bonds or any portion thereof shall be deemed made when the Town has placed in escrow with a commercial bank exercising trust powers, an amount sufficient, without reinvestment, (including the known minimum yield from L Federal Securities, as hereinafter defined) to meet all requirements of principal of, premium, if any, and interest on such bonds as the same become due to maturity or to a designated prior redemption date; and, if such bonds are to be redeemed prior to maturity, when the Town has given to the Registrar irrevocable written instructions to give- notice of prior redemption in accordance with Section 4 hereof. The Federal Securities shall become due prior to the respective times on which the proceeds thereof shall be needed, in accordance with a schedule agreed upon between the Town and such bank at the time of creation of the escrow. Federal Securities within the meaning of this section shall include only direct obligations of the United States, which are not callable prior to their scheduled maturities by the issuer thereof, or an interest in such obligations. In the event that there is a defeasance of only part of the bonds, the Registrar shall, if requested by the Town, institute a system to preserve the identity of the individual -30- 0 bonds or portions thereof so defeased, regardless of changes in bond numbers attributable to transfers and exchanges of bonds; and any Registrar shall be entitled to reasonable compensation and reimbursement of expenses from the Town in connection with such system. Section 16. Direction to Take Authorizing Action. The officers of the Town are hereby authorized and directed to take all action necessary or appropriate to effectuate the provisions of this ordinance, including, without limiting the generality of the foregoing, the printing of the bonds, obtaining bond insurance and the execution of such certificates as may be required by the Purchaser, including without limitation certificates relating to the signing of the bonds, the tenure and identity of the municipal officials, the delivery of the bonds and receipt of the bond purchase price, the tax exempt status of the bonds, and the absence of pending or threatened litigation, if in accordance with the facts, affecting the validity thereof. Section 17. Approval of Proposal, Registrar Agreement, and Acquisition Escrow Agreement. The forms, terms and provisions of the Proposal, the Registrar Agreement, and the Acquisition Escrow Agreement hereby are approved and the Town shall enter into and perform its obligations under the Proposal, the Registrar Agreement, and the Acquisition Escrow Agreement in substantially the forms of such documents presented to the Council at this meeting, with only such changes therein as are approved by the Mayor and the Town Manager; and the Mayor is hereby authorized and directed to execute and deliver the Proposal, the Registrar Agreement, and the Acquisition Escrow Agreement and the Clerk is hereby authorized and directed to affix the Town seal to the Proposal, the Registrar Agreement, and the Acquisition Escrow Agreement and to attest the Proposal, the Registrar Agreement, and the Acquisition Escrow Agreement. Section 18. Official Statement. The distribution and use of the Preliminary Official Statement by the Purchaser is in all respects hereby ratified, approved and confirmed. The -31- Purchaser is authorized to prepare or cause to be prepared,, and the Mayor and the Town'. Manager are authorized and directed to approve, on behalf of the Town, a final Official Statement for use in connection with the offering and sale of the bonds. The execution of a final Official Statement by the Mayor and the'Town Manager shall be conclusively deemed to evidence the approval of the form and contents thereof by the Town. Section 19. Contract with Bondowners. After any of the bonds herein authorized are issued, this ordinance shall constitute a contract between the Town and the owner or owners of the bonds, and shall be and remain irrepealable until the bonds and the interest accruing thereon shall have been fully paid, canceled and discharged. Section 20. Severability. If any section, paragraph, clause or provision of this ordinance shall be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, clause or provision shall in no manner affect any other provision of this ordinance. Section 21. Repeal. All ordinances, resolutions,,by- laws or parts thereof in conflict with this ordinance are hereby repealed only to the extent of such conflict. Section 22. Disposition of Ordinance. This Ordinance, as adopted by the Council, shall be numbered.and recorded by the Town Clerk in the official records of the Town. The adoption and publication shall be authenticated by the signatures of the Mayor and Town Clerk, and by the certificate of publication. Section 23. Effective Date. This ordinance shall be in full force and effect seven (7) days after its publication in a newspaper of general circulation in the Town upon its final passage. INTRODUCED, PASSED ON FIRST READING, AND ORDERED PUBLISHED THIS 14th day of April, 1987. -32- Mayor Town f Avon, olorado (SEAL) At st: Town Cl rk own of Avon, Colorado ADOPTED AND APPROVED WITH AMENDMENTS THIS 28th day of April, 1987. C;)~ Mayo Town of Avo Colorado (SEAL) Attest : Town of Avoh, Col -33- C~ The question being upon the passage and adoption of the amendments to the Ordinance, the roll -was called with the following result: Those Voting Yes: Those Voting No: Emilie Harrison Steve Miller Clint Watkins Gloria McRory Al Connell TAB r'r -0- Those Absent: 6 members of the Town Council having voted in favor of the motion, the presiding officer thereupon declared the motion carried and the proposed amendments duly passed and adopted. It was thereupon moved by Councilmember Miller and seconded by Councilmember Harr;Gn„ that the foregoing amended Ordinance be approved on second and final-reading and be published in full in a newspaper of general circulation in the Town. The question being upon the adoption of such motion, the roll was called with the following result: Those Voting Yes: Those Voting No: Those Absent: Emilie Harrison Steve Miller Clint Watkins Gloria McRory Al Connell Jerry Davis .0- -0- -34- 0 0 At least two-thirds of the members of the Town Council having voted in favor of such motion, the presiding officer thereupon declared the motion carried. Thereupon, the Town Council considered other business and took other action not concerning the general obligation bonds to defray the cost thereof. Thereafter, there being no further business to come before the meeting, on motion duly made, seconded and unanimously carried, the meeting was adjourned. Mayor Town of Avon, Colorado (SEAL) Attest: -35- Town of Avon, Colorado STATE OF COLORADO ) COUNTY OF EAGLE ) SS. TOWN OF AVON ) I, Patricia J. Doyle, duly appointed and acting Clerk of the Town of Avon (the "Town"), Eagle County, Colorado, do hereby certify that the foregoing pages numbered 1 to 34, inclusive, constitute a true and correct copy of the record of proceedings of the Town Council of the Town, taken at a regular meeting thereof, held at the Town Hall, in Avon, Colorado,-the regular meeting place of the Council, on Tuesday, April 28, 1987, insofar as said proceedings relate to, the introduction and passage on second and final reading of an ordinance therein set forth, concerning the sale and issuance of general obligation bonds of the Town. I further certify that attached hereto is an affidavit of publication of said ordinance as passed on second and final reading - by the Town Council-at said meeting; and that the Mayor and 6 other members of the Town Council were present at the meeting and the members of the Council voted as in-the minutes set forth. IN WITNESS WHEREOF, I have hereunto set my hand and the seal of the Town of Avon, Colorado, this 28thday of April 1987. (SEAL) -36- i • (Attach Affidavit of Publication of Ordinance After Final Adoption) -37-