Jurisdiction: Ne-w po CjEnactment Date: \ l/l)/j 2._ 

State of Arkansas 

Type of Levy: ---=Lo:::..:c::.=a:.:..l S:::..:a::.:.:le:::::s:...:a:::.:.n:..:::d:....:U~s::::.e...:.T..:::;ax:.:..__ 

Ordinance No. -"""8'-~=-..:...( ____ Tax Rate: _l_'d __ _ 

Purpose and Use of Tax: b t.../l 'C.fc:t ( 0 

I 

p !.rq f- ion >-

~ 

Applicability of Tax: General sales & use tax- Applies to all goods and services taxable under state law. 

Administrative Costs: 3% of gross collections withheld by the state for administration of the tax. 

Credits or Exemptions: Tax subject to same credits & exemptions available under state sales & use tax law 

Subsequent Amendments and Amendment Purpose: 

1. Date: O'J../ \ f{ /1_ r Amending Ordinance No. ----'10""-0_2.., _____ _ 

Purpose of Amendment: l?.Xr ~f-.~ !'c-v~n ve. f lecfJ eJ tl9 b" tJ J _2 

2. Date: --------- Amending Ordinance No.----- ------

Purpose of Amendment: -------- --------- ---- ----

3. Date: --------- Amending Ordinance No.----- ------

PurposeofAmendment: -------------- -----------

4. Date: --------- Amending Ordinance No.-----------

Purpose of Amendment: -------------------------

Is the tax on aviation fuel distributed for airport related purposes: Yes o@NO If No, state reason 

for belief that the tax is grandfathered. 

~c q { fats, { ~"7 pre. drJ.te s I Z-/3 0/ ( crcr/{ a(\J 5 ,;], s <. z, vCflt pI (.~f:: 

0 ~ ({-I/ (.n t/ e r'5 htJ + q ') v.Pilil. f) b 'rr ( c.ka'j e. 

The state of Arkansas administers local taxes for all cities and counties in this state and commits that the 

Arkansas Department of Finance and Administration will notify the FAA of any subsequent amendments 

to this tax that could affect grandfathered status. 

ohn H. Theis, Assistant Revenue Commissioner 

J?;/4/15 

Date 
ORDINANCE NO. 861 

AN ORDINANCE PROVIDING FOR THE LEVY OF A LOCAL 

SALES TAX AND USE TAX AT THE RATE OF ONE PERCENT 

(1%} ON RECEIPTS FROM RETAIL SALES WITHIN THE 

CITY OF NEWPORT, ARKANSAS! PROVIDING FOR THE REBATE OF TAXES IN EXCESS OF TWENTY FIVE DOLLARS 

($25.00) PAID TO THE CITY ON A SINGLE TRANSACTION; 

PROVIDING FOR A SPECIAL ELECTION ON NOVEMBER 23, 1982; 

PROVIDING THE EMERGENCY CLAUSE AND FOR OTHER PURPOSES. 

BE IT ORDAINED by the City Council of the City of Newport, 

Arkansas, in regular session assembled, as follows: 

Section 1. That pursuant to Section Two, Act 990 of the 

1975 Acts of Arkansas, as amended by Act 133 of 1981, a local 

sales and use tax in the amount of one percent (1%) he levied 

on the receipts from the sale at retail within the City of 

Newport, Arkansas, on all items which are subject to taxation 

under the ARKANSAS GROSS RECEIPTS TAX ACT, Act 336 of 1941 of 

the Acts of Arkansas, as amended, or may be hereinafter, amended. 

Section 2. As authorized by State Statutes, the City of 

Newport, Arkansas, shall rebate, on an individual claim basis, 

taxes paid to the City under thi-s ordinance which amount to be 

more than Twenty-Five Dollars ($25.00) as paid on a single 

transaction which exceeds Twenty-Five Hundred Dollars ($2500.00}. 

section 3. Said question of the levee of a sales tax 

and use tax as provided in Section One heEof shall be submitted to 

a vote of the citizens of Newport, Arkansas, by special election 

to be held on November 23, 1982. 

Section 4. That the City Council of the City of Newport, 

Arkansa.s, has determined that there is a great need to establish 

a stable source of revenue to finance vital municipal services, 

and this Ordinance being necessary for the preservation of the 

health, safety and welfare of the citizens of Newport, Arkansas, 

shall become law immediately upOn its passage, approval and 

publication. 

.., .. 

PP,S'SED A!'ID AJ?P·ROVED 0 ;!.'\,,? c t"o"b'e'<JJ';· 

"MAY"OR 
ORDINANCE NO. 1002 

AN ORDINANCE AUTHORIZING THE REFUNDING OF OUTSTANDING SALES AND USE TAX BONDS OF THE CITY OF NEWPORT, ARKANSAS; AUTHORIZING BONDS 

FOR THE FINANCING THEREOF; DECLARING AN EMERGENCY; AND FOR RELATED PURPOSES. 

WHEREAS, there was submitted to the qualified electors of 

the City of Newport, Arkansas (the "City"), at a special election 

held June 26, 1990, the questions of issuing bonds of the City, in 

the aggregate principal amount of $4,900,000 (the 11Bonds 11

Amendment 

), under 

Title 

No. 62 to the constitution of the state of Arkansas and 

Annotated 

14, Chapter 164, Subchapter 3 of the Arkansas Code of 1987 

(the "Authorizing Legislation11 ), for the following 

purposes: 

1. $3, 600, 000 for the 

outstanding Sewer Revenue Imprqvement 

December 15, 1986; 

refunding of 

and Refunding 

the City'S Bonds dated 

municipal 

2. $600, 000 for the acquisition of a building toT administrative offices, with modifications incidental 

Halli 

thereto and necessary modification of and improvements to the City 

3. $700,000 for the purpose of the-' construction 

(including the acquisition of necessary land and facilities} of a 

fire station and the acquisition of firefighting apparatus; and 

WHEREAS, at the special election the qualified electors 

of the city approved the issuance of Bonds (the 11Refunded Bonds 11 ) 

for all the proposed purposes, and the pledge to the payment and 

security of the Bonds of collections of an ad valorem ta~ at the 

rate of o. 8 mills and·' collections of the City's 1% sales and use 

tax; and 

WHEREAS, it has been found and determined that significant savings can be effected by the refunding of the 

Refunded Bonds and, to that end, the City proposes to issue its 

Sales and Use Tax Refunding Bonds, series 1997 (the 

Bonds") 

11Series 1997 

in the principal amount of $3,320,000 and to apply the proceeds of the series 1997 Bonds, with funds presently held in 

Refunded 

connection with the Refunded Bonds, to the refunding of the 

Bonds (the 11Refunding11 ); and 

WHEREAS, the city has made arrangements to" se-ll the 

Series 1997 Bonds to T.J. Raney/Morgan Keegan (the "Underwriter"} at 

a price of 98.25% of the principal amount thereof pursuant to a 

8 
Bond Purchase Agreement (the "Agreement 11 ) copies of which have been 

presented to the City Council of the City and are before the City 

Council at the meeting of which this Ordinance is adoptedi and 

WHEREAS, copies of the Preliminary Official Statement for 

the 'offering of the Bonds (the "Preliminary Official statement 11 ) 

have been presented to the City Council and are before the city Council at the meeting at which this Ordinance is adopted; 

NOW THEREFORE Be It Ordained By the Ci.t.y Cou~cil of the 

City of Newport, Arkansas: 

Section 1. The Refunding shall be accomplished, and the 

Mayor of the City is hereby authorized to take all action necessa:roy. in connection therewith and to execute all required contracts and 

documents. 

Section 2. The sale to the Underwriter of $3,320,000 in 

principal amount of Series 1997 Bonds by the City at a price of 

98.25% of par, plus accrued interest, for Series 1993 Bonds bearing 

interest at the rates per annum, maturing and otherwise subject to 

the terms and provisions hereafter in 'this Ordinance set forth in 

detail be, and is hereby apcepted, and the Agreement, in 

substantially the form submitted to this meeting, is approved and 

confirmed and the Bonds are hereby sold to the Underwriter. The 

Mayor is hereby authorized and directed to execute and deliver t~e· 

Agreement on behalf of the City and to take all action required on 

the part of the city to fulfill its obligations under the Agreement 

(including, without limitation, the execution of an agreement for 

required _continuing disclosure). 

section 3. The Preliminary Official Statement is hereby approved and the previous use of~the Preliminary Official Statement 

by the Underwriter in connection with the sale of the Series 1997 

Bonds is hereby in all respects authorized, approved and confirmed, 

and the Mayor is hereby authorized, empowered and directed, for and 

on behalf of the City, .to exeoute the Preliminary Official Statement 

and to execute the fin,al Official statement in the name of, tbe City 

to be delivered to the Underwriter for use in connection with the 

sale of the Series 1997 Bonds as set forth in the Agreement. The 

Preliminary Official is "deemed f inal 11 for the purpose of compliance 

with Securities and Exchange Commission Rule 15 c2-12. 

Section 4. Under the authority of the Constitution and 

laws of the state of Arkansas, including particularly Amendment No. 

62 to the constitution of the State of Arkansas and the Authorizing 

Legislation, City of Newport, Arkansas Sales and Use Tax Refunding Bonds, Series 1997, are hereby authorized and ordered issued in the 

total principal amount of $3,320,000, the proceeds of the sale of 

which are necessary to provide sufficient funds for accomplishing, 

with other funds, the Refunding, paying expenses incident~! thereto, 

2 

9 
establishing a debt service reserve and paying expenses of issuing 

the Series 1997 Bonds. 

The Series 1997 Bonds shall bear interest at the rates 

and principal and interest shall be payable at the times in the 

amounts as follows: 

Date 

06/01/97 

12/01/97 

06/01/98 

12/01/98 

06/01/99 

12(01/99 

06/01/00 

12/01/00 

06(01/01 

12/01/01 

06/01/02 

12/01/02 

06(01/03 

12/01/03 

06/01/04 

12(01/04 

06(01(05 

12/01/05 

06(01/06 

12/01/06 

06(01/07 

12/01/07 

06/01/08 

12/01/08 

06/01/09 

121011 o9 

06/01/10 

12/01/10 

06/01/11 

12/01/11 

06(01/12 

Principal 

( :une 2.) 

$ 270,000 

275,000 

290,000 

300,000 

310,000 

320,000 

335,000 

345,000 

370,000 

385,000 

20,000 

25,000 

Interest 

F;at:es(%' 

3. 80 

4.20 

4.30 

4.40 

4.45 

4.55 

4.65 

4.75 

4.80 

4.90 

s ..... oo 

5.10 

5.15 

5.20 

5.25 

Interest 

$37,650.00 

75,300.00 

75,300.00 

70,170.00 

70,170.00 

64,395.00 

64,395.00 

58,190.00 

58,160.00 

51,560.00 

51,560.00 

44,662.50 

44,662.50 

37,382.50 

37,382.50 

29,593.75 

29,593.75 

21,400.00 

21,400.00 

12,520.00 

12,520.00 

3,087.50 

3,087.50 

2,587.50 

2,587.50 

1,950.00 

1,950.00 

1,306.25 

1,306.25 

656.25 

656.25 

Total 

$37,650.00 

420,600,00 

415,340.00 ,. 

418,790.00 

416,320.00 

413,120.00 

409,325.00 

409,765.00 

404,187.50 

412,800.00 

,410,040.00 

27,612 ;so 

26,312.50 

The Series 1997 Bonds shall be issuable only as fully 

registered bonds without coupons in the denomination of $5,000 or 

any integral multiple thereof. Unless the City shall otherwise 

direct, the Series 1997 Bonds shall. be numbered from 1 upward in 

order of issuance. Each Series 1997 Bond shall have a CUSIP number 

but the failure of a CUSIP number to appear on any series 1997 Bond shall not affect its validity. 

f:~.-1 

l'cibNur II, 19'11 

1.0 

3 
Interest on the Series 1997 Bonds shall be payable on June 1, 1997, 

and semiannually thereafter on June 1 and December 1 of each year. 

Payment of each installment of interest shall be made to the person 

in whose name the series 1997 Bond is registered on the registration 

Magnolia, 

books of the city maintained by Farmers Bank & Trust company, 

Arkansas, as Trustee and Paying Agent (the "Trustee 11 ), at 

the close of business on the fifteenth day of the month {whether or 

not a business day) next preceding each interest payment date (the 11Record Date"), irrespective of any transfer or exchange of any such Series 1997 Bond subsequent to such Record Date and prior to such interest payment date, by check or draft mailed by the Trustee to such owner at his address on such registration books. Principal of 

the Series 1997 Bonds shall be payable at the corporate trust office 

of the Trustee in Magnolia 1 Arkansas. ,. 

The City has reserved the power to issue Additional Bonds 

on a parity of security with the series 1997 Bonds, as set forth 

hereinbeloW1 and references herein to 11Bonds 11 are to and include the 

series 1997 Bonds and any Additional Bonds. 

Certificate Only such Bonds as shall have endorsed thereon a of Authentication substantially in the form set forth in 

Section 6 hereof duly executed by the Trustee shall be entitled to any right or benefit under this Ordinance. No Bond shall be valid 

Authentication 

and obligatory for any purpose unless and until such Certificate of 

shall have been duly executed by the Trustee, and such certificate of the :,·Trustee upon any such Bond shall l;ieconclusive evidence that such Bond has been authenticated and 

Authentication 

delivered under this Ordinance. The Trustee's Certificate of 

on any Bond shall be deemed to have been executed if signed by an authorized officer of the Trustee, but it shall not be 

Authentication 

necessary that the same officer sign the cel:-tificate of 

on all of the Bonds. ~ 

In case any Bond shall become mutilated or be destroyed 

or lost, the city shall, if not then prohibited by law, cause to be 

executed and the Trustee may authenticate and deliver a new Bond of 

like da~e, number, matprity and tenor in exchange and substitution 

for and upon cancellation of such mutilated Bond, or in li~u,of and in substitution for sUch Bond destroyed or lost 1 upon the owner's 

paying the reasonable expenses and charges of the City and Trustee 

in connection therewith, and, in the case of a Bond destroyed or 

lost 1 his filing with the Trustee evidence satisfactory to it that 

such Bonds were destroyed or lost, and of his ownership thereof, and 

furnishing the City and Trustee with indemnity satisfactory to them. 

The Trustee is hereby authorized to authenticate any such new Bond. In the event that any such Bond shall have matured, instead of 

issuing a new Bond, the City may pay the same without the surrender 

City 

thereof. 

may 

Upon the issuance of a new Bond under this Section 4, the require the payment of a sum sufficient'· to cover any tax or 

other governmental charge that may be imposed in relation thereto 

4 

1.1 
and any other expenses {including the fees and expenses of the 

Trustee) connected therewith. 

The City shall cause books for the registration and for the transfer of the Bonds as provided herein and in the Bonds. The Trustee shall act as the bond registrar. Each Bond is transferable by the registered owner thereof or by his attorney duly authorized in writing at the principal office of the Trustee. Upon such transfer a new fully registered Bond or Bonds of the same maturity, of authcrize::i de:-Jomine.-::.ion or denominations, for ::he same aggre:;rate 

principal amount will be issued to the transferee in exchange therefor. 

Bonds may be exchanged at the principal office of the 

Trustee for an equal aggregate principal amount of Bonds of an~t 

other authorized denomination or denominations. The City shall 

execute and the Trustee shall authenticate and deliver Bonds which the registered owner making the exchange is entitled to receive. The execution by the city of any Bond of any denomination shall constitute full and due authorization of such denomination and the 

Trustee shall be thereby authorized to authenticate and deliver such Bond. 

No charge shall be mad~ to any owner of any Bond for the privilege of transfer or exchange, but any owner of any Bond requesting any such transfer or exchange shall pay any tax or other; governmental charge required to be paid with respect theretoExcept as otherwise provided in the immediately preceding sentence, the cost of preparing each new Bond upon each exchange or transfer and any other expenses of the City or the Trustee incurred in connection therewith shall be paid by the City. The C~ty shall not 

be required (i) to issue, transfer or exchange any Bond during a 

period beginning at the opening .... of business 15 days before any 

selection of Bonds of that maturity for redemption and ending at the close of business on the day of the first mailing of the relevant notice of redemption, or (ii} to transfer or exchange any Bonds 

selected for redemption in whole or in part. 

. ' The person in whose name any Bond shall be registered shall be regarded as tfie absolute owner thereof for all purposes, 

and payment of or on account of the principal or premium, if any, or 

interest on any Bond shall be made only to or upon the order of the registered owner thereof or his legal representative, but such registration may be changed as hereinabove provided. All such 

payments shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid. 

If any date of maturity of interest on or principal of the Bonds or a~y date fixed for redemption of any Bonds shall be a 

Saturday or Sunday or shall be in the state of Arkansas a legal holiday or a day on which banking institutions are authorized by law 

5 

:12 

. . 
to close, payment of interest or principal need not be made on such 

date but may be made on the next succeeding business day not a 

Saturday or sunday or a legal holiday or a day upon which banking 

institutions are authorized by law to close, with the same force and 

effect as if made on the date of maturity or the date fixed for 

redemption, and no interest shall accrue for the period after the 

date of maturity or date fixed for redemption. 

Section 5. The Bonds shall be executed on behalf of the 

City by th12 :r.anL.al or facsimile signatures of the Mayer and City 

Clerk and shall have impressed, imprinted, engraved or lithographed thereon the seal of the City. 

Section 6. The Bonds and the Trustee's Certificate of 

Authentication shall be in substantially the following form (wi-ttl 

appropriate changes in the event of the issuance of Additional 

Bonds) and the Mayor and city Clerk are hereby expressly authorized 

and directed to make all recitals contained therein: 

6 

1.3 
REGISTERED 

No. 

(Form of Bond) 

UNITED STATES OF AMERICA 

STATE OF ARKANSAS 

COUNTY OF JACKSON 

CITY OF NEWPORT 

SALES AND USE TAX REFUNDING BOND 

SERIES 1997 

REGISTERED 

Interest Rate: % Maturity Date: June 1 

Dated Date: March 1, 1997 Registered Owner ------------

Principal Amount 

CUSIP NO: 

KNOW ALL MEN BY THESE PRESENTS: 

The City of Newport, Arkansas (the 11City11 ), for value received, hereby promises to pay to the Registered owner shown 

above, upon the presentation and surrender hereof at the principal 

corporate trust office of Farmers Bank & Trust Company, Magnolia, 

Arkansas, or its successor or successors, as Trustee and as Paying 

Agent (herein referred to as the "Trustee"), on the Maturity Date shown above, the Principal Amount shown above, in su,ch coin or 

currency of the United States of America as at the time of payment 

shall be legal tender for the payment of public and private debts 

and to pay by check or draft interest thereon, in like coin or 

currency, from the Dated Date shown above, at the Interest Rate per 

annum shown above, payable June 1, 1997 and semiannually thereafter, on the 1st days of June and December, until payment of such 

Principal Amount or, if tbis Bond or a portion thereof shall be duly 

called for redemption, until the date fixed for redemption, ~nd·to 

pay i::te~est on overdue' principal and interest (to the extent 

legally enforceable) at the rate borne by this Bond. Payment of 

each installment of interest shall be made to the person in whose 

name this Bond is registered on the registration books of the City maintained by the Trustee at the close of business on the fifteenth 

day of the month (whether or not a business day) next preceding each interest payment date (the 11Record Date 11 ) , irrespective of any 

transfer or exchange of the Bond subsequent to such Record Date and prior to such interest payment date. Interest on this series 1997 

Bond shall be payable from the interest payment date next preceding 

the date on which this Series 1997 Bond is authenticated, unless 

this Series 1997 Bond is authenticated on an interest payment date, in which case it shall bear interest from such date, or unless ·'this 

7 

. 

14 
Series 1997 Bond is authenticated prior to June 1, 1997, in which 

case it shall bear interest from the Dated Date, or unless this 

Series 1997 Bond is authenticated during the period from the Record 

Date to the next interest payment date, in which case it shall bear interest from such interest payment date, or unless at the time of 

authentication of this Series 1997 Bond interest is in default 

hereon, in which case it shall bear interest from the date to which 

interest has been paid. 

This Bond is one of an issue of City of Newport, Arkansas 

Sales and Use Tax Refunding Bonds, Series 1997 (the "Series 1997 

Bonds 11 ), in an aggregate principal amount of $3,320,000, issued for the purpose of financing, with other funds, the cost of refundin~ 

outstanding bonds of the City, funding a debt service reserve, paying necessary expenses incidental thereto and paying expenses of authorizing and issuing the Series 1997 Bonds. 

The Series 1997 Bonds are issued pursuant to and in full 

compliance with the constitution and laws of the state of Arkansas, 

particularly Amendment No. 62 to the Constitution of the state of 

Arkansas and Arkansas Code of 1987 Annotated, Title 14, Chapter 164, 

Subchapter 3 {the "Authorizing. Legislation11 ), and pursuant to 

Ordinance No. of the City duly passed and approved on 

, 1990 (the "Authorizing Ordinance"), and ai) "e~l~e~c~t~i~o~n~d~u"'l yc.h~e~l~d at which the majority of the legal voters of the 

City voting on the question voted in favor of the issuance of the Bonds refunded by the Series 1997 Bonds. 

The city has reserved the power to issue Additional Bonds 

on a parity of security with the Series 1997 Bonds, as' set forth in 

the Authorizing Ordinance, and references herein to "Bonds" are to 

and include the Series 1997 BondS and any Additional Bonds. 

Reference is hereby made to the Authorizing Ordinance for 

the details of the nature and extent of the security and of the 

rights and obligations pf the1City, the Trustee and the Registered Owners of the Bonds. The Bonds are special obligations, of· the City. The Bonds are ~Secured by a pledge of collections of the 

City's one percent sales and use tax (the "Sales and Use Tax") and 

by a pledge of collections of a continuing ad valorem tax levied by 

the City at the rate of 0.8 mills on the dollar Qf the assessed value of the taxable real and personal property in the City (the uAd 

Valorem Tax"). 

(REFERENCE IS HEREBY MADE TO FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE HEREOF WHICH HAVE THE SAME EFFECT AS IF SET FORTH IN THIS PLACE.) 

,,.......,_,.., 

.,..., ll, 1997 8 

:15 
THE CITY HAS DESIGNATED THTS BOND AS A "QUALIFIED 

TAX-EXEMPT OBLIGATION" WITHIN THE MEANING OF SECTION 265 OF THE 

INTERNAL REVENUE CODE OF 1986, AS AMENDED. 

IN WITNESS WHEREOF, the City has caused this Series 1997 

Bond to be executed by the facsimile signature of its Mayor and 

attested by the facsimile signature of its City Clerk and the 

corporate seal of the City or facsimile thereof to be duly impressed 

or imprinted or lithographed on this Series 1997 Bond, as of the 

Dated Date shown above. 

ATTEST: 

(SEAL) 

(facsimile) 

City Clerk 

.-,, 

:16 

CITY OF NEWPORT, ARKANSAS ~ 

By _____ (~f~a~c~s~i~m~idl~eul~-------

Ma)ror 

9 
(FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION) 

TRUSTEE'S CERTIFICATE OF AUTHENTICATION 

This is to certify that this Bond 

Use Tax Refunding Bonds, Series 1997, issued 

Arkansas under the provisions of within 

Ordinance. 

is one of the Sales and 

by the City of Newport 1 

mentioned Authorizing 

as Trustee 

Date of Authentication: 

.. 1.7 

By __ ~~~~~~~~~----­ Author1zed Officer 

' . 

10 
(Back of Bond) 

The Series 1997 Bonds shall be subject to optional 

redemption as follows: 

The series 1997 Bonds are subject to redemption at the 

option of the City, on any after June 1, 2002, in whole at any time and in part, in inverse order of maturity (Series 1997 Bonds within 

a maturity to be selected by lot in such manner as the Trustee may determine), on any interest payment date, at a redemption price equal to the principal amount being redeemed plus accrued interest 

to the redemption date. 

In case any outstanding Bond is in a denomination greater 

than $5, ooo, each $5, 000 of face amount of such Bond shall be 

treated as a separate Bond of the denomination of $5,000. 

Notice of redemption identifying the Series 1997 Bonds or 

portions thereof (which shall be $5,000 or an integral multiple thereof) to be redeemed shall be given by the Trustee, not less than 

thirty (30) nor more than sixty {60) days prior to the date fixed for redemption, by mailing a copy of the redemption notice by first class mail, postage prepaid, to all Registered owners of series 199-.7 

Bonds to be redeemed. Failure to mail an appropriate notice or any such notice to one or more Registered Owners of Bonds to be redeemed 

shall not affect the validity of the proceedings for redemption of 

other Series 1997 Bonds as to which notice of redemption is duly 

given in proper and timely fashion. All such Series 1997 Bonds thus 

called for redemption and for theAretirement of which funds are duly 

provided in accordance with the Authorizing Ordinance prior to the 

date fixed for redemption will cease to bear interest on such 

redemption date. 

With respect to notice of redemption of the Series 1997 

Bonds at the option of the city, unless moneys sufficient to. pay the principal of and premiUm, if any, and interest on· the Series2:1997 Bonds to be redeemed shall have been receiVed by the Trustee·prior 

to the giving of such notice, such notice shall state that 

redemption shall be conditional upon the receipt of such moneys by 

the Trustee on or prior to the date fixed tor such redemption. If 

such moneys shall not have been so received, such notice shall be of 

no force and effect, the city shall not redeem such Series 1997 

Bonds and the Trustee shall give notice, in the manner in which the notice of redemption was given, that such moneys were not so received. 

This Series 1997 Bond is transferable by the Registered Owner shown above in person or by his attorney-in-fact duly 

11 

• 

18 

.. 
authorized in writing at the principal corporate trust office of the 

Trustee, but only in the manner, subject to the limitations and upon 

payment of the charges provided in the Authorizing Ordinance, and 

upon surrender and cancellation of this Series 1997 Bond. Upon such transfer a new fully registered Series 1997 Bond or Bonds of the same maturitv, of authorized denomina;::ion or denominations, for the 

same aggregate principal amount, will be issued to the transferee in exchange therefor. This Series 1997 Bond is issued with the intent that the laws of the State of Arkansas shall govern its 

construction. 

The City and the Trustee may treat the Registered owner 

hereof as the absolute owner hereof for the purpose of receiving 

payment of or on account of principal hereof and interest due hereon 

and for all other purposes, and neither the City nor the Trustee nor 

any paying agent shall be affected by any notice to the contrary. 

The Bonds are issuable only as fully registered Bonds in 

the denomination of $5, 000, and any integral multiple thereof. 

Subject to the limitations and upon payment of the charges provided 

'in the Authorizing ·ordinance, fully registered Bonds may be exchanged for a like aggregate principal amount of fully register~d, 

Bonds of the same maturity of other authorized denominations. 

IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all 

acts, conditions and things required to exist, happen and be performed, under the Constitution and laws of the Stat~ of Arkansas, particularly Amendment No. 62 to the Constitution of the state of 

Arkansas and the Authorizing Legislation, precedent to and in the issuance of the se·ries 1997 Bonds do exist, have happened and have 

been performed in due time, form and manner as required by law; and 

that the indebtedness represented by the Series 1997 Bonds, together 

with all obligations of the City, does not exceed any constitutional 

or statutory limitation. ' 

This SerieS' 1997 Bond shall not be valid until it shall 

have been authenticated by the Trustee by the execution of the 

Certificate of Authentication endorsed hereon. 

12 

1_9 
* * * * 

(Form of Assignment) 

FORM OF ASSIGNMENT 

VALUE RECEIVED, 

hereby sells, assignS--ancc--traTiSters--untO 

FOR 

("Transferor") , 

, the within Bond and all rights thereunder, ~a~n"ct"h"e::cr=e"b"y"i-:r"r"e"v;;::o:;c;:a"b"'l"yc-:::c::::o n s tit u tes and appoints 

("Transferee") as attorney to transfer the with~l,.,. n=-"s-=o::n::d;--co;;n:::-•t-.:h::e:.b::-o=o=k-=s 

kept for registration thereof with full power of substitution in the 

premises. 

DATE: 

Transferor 

GUARANTEED BY: 

NOTICE: Signature(s) must be guaranteed by a financial 

institution acceptable to the Trustee. 

' . 

13 

zo 
Section 9. (a) The Bonds shall constitute special 

obligations of the City to the payment of the principal of and interest on which, with Trustee's and Paying Agent's fees, the city hereby pledges the Ad Valorem Tax, which Ad Valorem Tax, is hereby 

levied and extended e.nC shall be collected annually until all ~he principal of and interest on ~he Bonds are paid in full, with Trustee's and Paying Agent's fees, or until adequate provision is made for such payment. The city agrees that at all times while any 

of the Bonds are outstanding there will be paid into the "Ad Valorem 

Tax Account 11 of the "Bond Fund11 (hereinafter defined} al...l. collections of the Ad valorem Tax (the "Ad Valorem Tax Revenues") as 

and when received. 

(b) The city hereby confirms and relevies its city-wide 1% sales and use tax levied pursuant to Ordinance No. 861 of the 

City, adopted october 4, 1982 and approved by a majority of the 

electors voting on the question at the special election held for 

that purpose. 

The city hereby expres.sly pledges and appropriates all of 

the revenues derived by the City from the Ad Valorem Tax and;, subject to the terms hereof, the Sales and Use Tax to the payment of· the pr incipa 1 of and interest on the Bonds when due and to the 

payment of the fees and charges of the Trustee and Paying Agent. 

The city covenants that neither the Ad Valorem Tax nor the Sales and 

Use Tax shall ever be repealed or reduced while any of,the Bonds are outstanding. The City further covenants to use due diligence in collecting the Ad Valorem Tax and the Sales and Use Tax . • 

Section 10. (a) There is hereby created with the 

Trustee a special fund in the name of the City which is hereby designated "Sales and Use Tax· Bond Fund" (the 11Bond Fund"). The Bond Fund shall be composed ~f three accounts, the Ad Valorem Tax 

Account, the Sales and Use Tax Account and the Debt Servic~ Reserve Account. So long as ~any of the Bonds are outstanding, the city Treasurer shall deposit into the Ad Valorem Tax Account the Ad Valorem Tax Revenues, as and when received (or the City may apply 

such Revenues to reimburse other accounts from which funds have been 

transferred to the Ad Valorem Tax Account), and shall deposit into 

the Sales and Use Tax Account, from Sales and Use Tax Revenues, as and when received, the sums in the amounts and at the times described below for the purpose of providing funds for the payment of the principal of and interest on the Bonds, as they mature, with Trustee's and Paying Agent's fees, and as a debt service reserve. There shall be deposited into the Sales and Use Tax Account on the 

first day of each month, commencing the month next following 

issuance of any Bonds, from the Sales and Use Tax Revenues received 

14 

21 
during the then preceding month, until all outstanding Bonds, with interest thereon, have been paid in full or provision made for such 

payment, a sum equal to 1/6 of the next installment of interest due 

on the Bonds and 1/12 of the principal due on the Bonds during the 

then next twelve months (except that the monthly payments for the 

period preceding the first interest and principal. ::;~y~er,t dates 

shall be equal to the amounts of such interest and principal 

payments divided by the number of complete or partial months between 

issuance of Bonds and such payment dates). 

The City shall also pay into the Sales and Use Ta>t 

Account such additional sums as necessary to provide for the 

Trustee's and Paying Agent's fees and expenses. 

The City shall receive a credit agai"nst monthly payments to the extent of (i) collected Ad valorem Tax Revenues, (ii) moneys 

deposited in the Sales and Use Tax Account from City sewer system 

revenues or other sources, (iii) interest earnings on moneys in the 

Sales and Use Tax Account and the Ad Valorem Tax Account and (iv) 

transfers of earnings from the De.bt Service Reserve Account. 

(b) The Debt Service Reserve Account shall b~ 

established, upon issuance of each series of Bonds and maintained in 

an amount equal to the least of (i) 10% of the principal amount of 

Bonds, as issued, or (ii) the maximum annual principal of and 

interest on such Bonds or (iii) 125% of the average annual principal and interest on such Bonds (the "Required Level 11 )., Should any 

amount be withdrawn from the Debt Service Reserve -Account, the 

deficiency shall be cured by t!J.e deposit therein of the first 

available Sales and use Tax Revenues until the reduction is 

corrected. Moneys in the Debt Service Reserve Account over and 

above the Required Level shall be immediately transferred from the 

Debt Service Reserve Account into the Sales and Use Tax Account. 

(c) The amounts required to be paid into the Sqles and 

use Ta:x Account shall be paid before any of the Sales and Use Tax 

Revenues are used for any other purpose. If the Sales and Use Tax 

Revenues are insufficient to make the required payment on the first 

day of the following month, the amount of any such .deficiency in the 

payment made shall be added to the amount otherwise required to be 

paid into the Sales and Use Tax Account on the first day of the next 

month. 

If for any reason there shall be a deficiency in the 

payments made into the Bond Fund so that there are unavailable 

sufficient moneys therein to pay the principal of and interest on 

the Bonds as the same become due, any sums then held in the Debt 

Service Reserve Account shall be used to the ertent necessary ··to pay 

15 

22 
such principal, interest, and Trustee's and Paying Agent's fees, but 

the Debt Service Reserve Account shall be reimbursed in the amount 

of any such payment as described above. 

(d) When the moneys in the Bond Fund, including the Debt 

Service Reserve Account, shall be and remain sufficient to pay (1) 

the princ~?al of all the Bonds then out$tanding, (2) interest on the Bonds until maturity or redemption, and (3) the Trustee 1 s and Paying Agent 1 s fees and expenses, there shall be no obligation to make any further payments into the Bond Fund and any moneys remaining in the 

Bond Fund after the principal of and interest on the Bonds have be~n paid or have been provided for as set forth in section 11 below maY 

be used by the City for any lawful purpose. 

(e) All moneys in the Bond Fund shall be used solely for 

the purpose of paying the principal of and interest on the Bonds 1 and Trustee's and Paying Agent 1 s fees, as the same become due. 

(f) The Trustee is authorized and directed to withdraw 

moneys from the Bond Fund (the first withdrawals to be from the Ad 

Valorem Tax Account 1 to the extent of funds held therein) from time 

to time as necessary for paying principal of a-nd interest on the Bonds when due at maturity or at redemption prior to maturity ~hd for making other authorized Bond Fund expenditures. 

(g) The Bonds shall be specifically secured by pledges 

of the Ad Valorem Tax Revenues and the Sales and Use Tax Revenues, which pledges in favor of the Bonds are hereby irrevocably made 

according to the terms of this Ordinance, and the city, and the 

officers and employees of the city, shall execute, perform and carry 

out the terms thereof in strict conformity with the provisions of this Ordinance. 

(h) Noth~ng in ,this Ordinance shall be construed as prohibiting the City from appropriating funds to the extept that 

they may be legally·' appropriated and used for the pS.yment Of 

principal of and interest on the Bonds if moneys in the Bond Fund (including the Debt service Reserve Account) are not sufficient on 

any interest payment date to make the principal and interest payment 

then due, and such amounts legally appropriated and available tor 

that purpose shall be paid to the Trustee for deposit into the Bond 

Fund and used for that purpose. 

( i) Sales and Use Tax Revenues not required by this Ordinance to be deposited into the Sales and Use Tax Account are regarded as released from the pledge in favor of the Bonds and may be used or pledged by the City for any lawful municipal purPose. 

16 

., 

23 

., 
Sec~ion 11. Any Bond shall be deemed to be paid within the meaning of this Ordinance when payment of the principal of and 

interest on such Bond {whether at maturity or upon redemption as provided herein, or otherwise), either (i) shall have been made or caused to be made in accordance with the terms thereof, or {ii) shall have been provided for by irrevocably depositing with the 

'Trustee, in 7-.rust and irrevocably set aside exclusively for such 

payment (1) moneys sufficient to make such payment or {2) Government 

Securities as defined in Section 19 hereof {provided that such 

deposit will not, in the opinion of counsel nationally recognized with respect to state and local government obligations and the 

exemption from federal income tax for interest thereon, acceptable 

to the Trustee, cause any of the Bonds to be classified as "arbitrage bonds" within the meaning of Section 148 of the Internal 

Revenue Code of 1986, as amended (the "Code"}}, maturing as to principal and interest in such amounts and at such times as will 

provide sufficient moneys to make such payment, and all necessary and proper fees, compensation and expenses of the Trustee with 

respect to which such deposit is made shall have been paid or the 

payment thereof provided for to the satisfaction of the Trustee. 

On the payment of all the Bonds within the meaning of 

this section, the Trustee shall hold in trust, for the benefit of 

the owners of such Bonds, all such moneys andjor Government 

Securities. 

When all the Bonds shall have been paid. within the 

meaning of this Section, and if the Trustee has been·paid its fees 

and expenses, the Trustee shall tQke all appropriate action to cause 

( i) the pledge and lien of this Ordinance to be discharged and 

canceled, and (ii) all moneys held by it pursuant to this Ordinance and which are not required for the payment of such Bonds to be paid 

over or delivered to or at the direction of the City. 

section 12. The City covenants that it will not~ so· long 

as any of the Bonds ar~ outstanding, issue any bonds, or incur any 

obligation, secured by a lien on or pledge of the Ad Valorem Tax Revenues or the Sales and Use Tax Revenues superior to the lien and 

pledge securing the Bonds. The City may issue bonds or incur obligations subordinate to the lien on Sales and Use Tax Revenues in favor of the Bonds. 

The City reserves the power to issue Additional Bonds. Additional Bonds will, as set forth below, rank on a parity of pledge and security with the Series 1997 Bonds and any Additional 

Bonds previously issued, provided that one of the following conditions is met: 

17 

24 
1. Bonds may be issued upon there being filed with the 

Trustee the certificate of the Mayor of the City reflecting that the 

tota1 of Sales and Use Tax Revenues for the then preceding twelve 

months equalled not less than 135% of the maximum annual principal and interest requirements for all Bonds then outstanding and the 

A de:.:;. ::io:tal Bonds ; -::>t:>csed to !::e issue::., settinc;: forth the amounts of 

sucn sa::.es and Lse ·~::..:,. R.eve:n'Jes by month. sucn Add~Lional Bonds 

will rank on a parity as to Sales and Use Tax Revenues only. 

2. Bonds may be issued upon there being filed with the Trustee the certificate of the Mayor of the City reflecting that the 

total of Sales and Use Tax Revenues and Ad Valorem Tax Revenues for the then preceding twelve months equalled not less than 135% of the maximum annual principal and interest requirements for all Bonds 

then outstanding and the Additional Bonds proposed to be issued, setting forth the amounts of Sales and Use Tax Revenues by month. 

such Additional Bonds will rank on a parity as to Sales and Use Tax 

Revenues and Ad Valorem Tax Revenues. 

Upon the issuance of any such Additional Bonds 1 the level 

of the Debt Service Reserve AccoUnt shall equal not less than the Required Level (for all Bonds to be outstanding following th~ issuance of such Additional Bonds). 

section 13. The series 1997 Bonds shall be callable for payment prior to maturity in accordance with the terms set out in 

the bond form in Section 6 of this Ordinance. 

Section 14. It is hereby covenanted by the City with the 

owners of the Bonds that the Ci!y will faithfully and punctually 

perform all duties with reference to the Bonds and the Ad Valorem 

Tax and the Sales and Use Tax required by the Constitution and laws 

of the state of Arkansas and by this Ordinance 1 including the 

collection of the Ad Va~orem Tax Revenues and the Sales and Use Tax 1 as herein specified and covenanted and the applying of, the Ad 

Valorem Tax Revenues arld the Sales and Use Tax Revenues as herein 

provided. 

section 15. The city Treasurer will keep or cause to be kept proper books of accounts and records (separate from all other 

accounts and records) in which complete and correct entries shall be made of all transactions relating to the Ad Valorem Tax Revenues and 

Sales and Use Tax Revenues and such books shall be available for 

inspection by the Trustee and the owner of any of the Bonds at 

reasonable times and under reasonable circumstances. Upon written request by the Trustee, the City shall furnish a report to the 

Trustee on a monthly basis of all receipts and transfers of the Ad Valorem Tax Revenues and Sales and Use Tax Revenues receiyed .by the 

18 

• 

25 
City Treasurer. The Trustee shall provide the City with semiannual 

reports of all transactions relating to the Bond Fund (and Debt 

Service Reserve Account therein} , which semiannual reports shall be 

presented on or before January 1 and July 1 of each year, and shall 

cover the then preceding period ending, respectively, November 30 or 

May 31 (or such other period as may be mutually acceptable to the City and the Trustee). 

Section 16. (a) If there be any default in the payment of the principal of and interest on any of the Bonds, or if the City defaults in the performance of any covenant contained in this 

Ordinance, the Trustee may, and shall, upon the written request of 

the owners of not less than ten percent (10%) in principal amount of 

the Bonds then outstanding, by proper suit compel the performance of 

the duties of the officials of the City under the Constitution and 

laws of the State of Arkansas and under this Ordinance, and to take 

any action or obtain any proper relief in law or equity available 

under the Constitution and laws of the state of Arkansas. 

(b) No owner of any Bond shall have any right to 

institute any suit, action, mandamus or other proceeding in equity or in law for the protection or enforcement of any right under this Ordinance or under the Constitution and laws of the State a_f 

Arkansas unless such owner previously shall have given to the Trustee written notice of the default on account of which such suit, 

action or proceeding is to be taken, and unless the owners of not 

less than ten percent (10%) in principal amount of the Bonds then 

outstanding shall have made written request of the TruStee after the 

right to exercise such powers or right of action, as the case may 

be, shall have accrued, and sfiall have afforded the Trustee a 

reasonable opportunity either to proceed to exercise the powers 

herein granted or granted by the Constitution and laws of the State 

of Arkansas, or to institute such action, suit or proceeding in its 

name, and unless, also,,there shall have been offered to the Trustee reasonable security and indemnity against the cost, exp~nffe and liabilities to be incurred therein or thereby and the Trustee shall 

have refused or neglected to comply with such request within a 

reasonable time, and such notification, request and offer of 

indemnity are hereby declared in every such case, at the option of 

the Trustee, to be conditions precedent to the execution of the 

powers and trust of this Ordinance or to any other remedy hereunder. It is understood and intended that no one or more owners of the 

Bonds shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security of this Ordinance, or to enforce any right hereunder except in the manner 

herein provided, that all proceedings at law or in equity shall be instituted, had and maintained in the manner herein provided and for 

the benefit of all owners of the outstanding Bonds and that any 

19 
individual rights of action or other right given to one or more of such owners by law are restricted by this Ordinance to the rights 

and remedies herein provided. 

(c) All rights of action under this Ordinance or under 

any of the Bonds, enforceable by the Trustee 1 may be enforced by it without the possession of any of the Bonds, and any such suit,· 

action or proceeding instituted by the Trustee shall be brought in 

its name and for the benefit of all the owners of the Bonds, subject 

to the provisions of this Ordinance. 

{d) No remedy herein conferred upon or reserved to the 

Trustee or to the owners of the Bonds is intended to be exclusive of any other remedy or remedies herein provided, and each and every 

such remedy shall be cumulative and shall be in addition to every 

other remedy given hereunder or given by any law or by the Constitution of the State of Arkansas. 

(e) No delay or omission of the Trustee or of any owners 

of the Bonds to exercise any right or power accrued upon any default 

shall impair any such right or power or shall be construed to be a 

waiver of any such default or an acquiescence therein, and every _ power and remedy given by this Ordinance to the Trustee and to ttre 

owners of the Bonds 1 respectively, may be exercised from time to 

time and as often as may be deemed expedient. 

(f) The Trustee may, and upon the written J;equest of the owners of not less than a majority of the owners in principal amount 

of the Bonds then outstanding sQall waive any default which shall 

have been remedied ·before the entry of final judgment or decree in any suit, action or proceeding instituted under the provisions of 

this ordinance or before the completion of the enforcement of any 

other remedy, but no such waiver shall extend to or affect any other 

existing or any subsequent default or defaults or impair any rights or remedies consequent thereon. ,, 

Section 17. When the Bonds, of any series, have been 

executed by the Mayor and City Clerk and the seal of the City im- pressed as herein provided, they shall be delivered to the Trustee, which shall authenticate them and deliver them to the Underwriter 

upon payment of the purchase· price as provided herein ("total sale 

proceeds"). The accrued interest shall be deposited in the Bond Fund, in the Sales and Use Tax Account. The balance of the total 

sale proceeds, together with other funds if elected, shall be 

deposited as follows (but as set forth in detail in a letter of delivery instructions signed by the Mayor): 

20 
1. The sum sufficient to accomplish any refunding shall 

be deposited in trust to accomplish such Refunding. 

2. 

Account at the 

Amounts sufficient to fund the Debt Service 

Required Level shall be deposited therein. 

Reserve 

. 3. Costs of issuance of such Bonds may be paid as 

directed. 

4. Any balance to be applied to the acquisition or 

construction of a financed project (the ''Project 11 ) shall be 

deposited in a special account of the City in a bank that is a 

member of the Federal Deposit Insurance Corporation designated "Construction Fund" (the 11Construction Fund11 ). 

Moneys in the Construction Fund shall be used for 

accomplishing the Project and paying expenses incidental thereto and 

paying the expenses of issuing such Bonds, with any unexpended balance to be deposited in the Sales and Use Tax Account. 

Disbursement shall be made from the Construction Fund on the basis 

of checks accompanied by requisitions which shall.specify: the name 

of the person, firm or corporation to whom payment is to be made;. the amount of the payment; the purpose of the payment; and that th? 

payment is a proper charge on the construction Fund. Each 

requisition must be signed by two persons designated by the City Council of the City. The depository of the Construction Fund shall 

be required to keep a copy of each requisition for a period of three 

years. 

When all required expenditures have been made from the 

construction Fund, this fact shall be evidenced by a certificate 

signed by the Mayor, which certificate shall state, among other 

thingsi the date of the completion and that all obligations payable from such Construction ,Fund have been discharged. A copy of the 

certificate shall be filed with the depository of such Cons~ruotion 

Fund, and a copy with the Trustee, and upon receipt thereof the City shall transfer any remaining balance to the Sales and Use Tax 

Account. 

section 18. (a) Moneys held for the credit of the Debt 

service Reserve Account in the Bond Fund shall be invested and 

reinvested in ( i} direct or fully guaranteed obligations of the 

United States of America (including any such securities issued or 

held in book-entry form on the books of the Department of the 

Treasury of the United states of America) ("Government Securities 11 ) 

or (ii) in time deposits or certificates of deposit of banks, including the Trustee, which are insured by the Federal Deposit Insurance Corporation (the 11 FDIC"), or, if in excess of inSurance 

21 

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28 
coverage, collateralized by Government Securities, or (iii) obligations issued by the Government National Mortgage Association 

or {iv) money market funds comprised exclusively of investments 

described in (i) or (iii) above which are registered with the S~curities and Exchange Commission and meet the requirements of Rule 

2a-7 under the Investment Company Act of 1940 (collectively, "Permitted Investments 11 ) all of which .shall mature, or which shall 

be subject to redemption by the holder thereof, at the option of 

such holder, not later than the final maturity date of the 

outstanding bonds, whichever is earlier. The Trustee shall so 

invest and reinvest pursuant to the direction of the City and in the 

Trustee's discretion in the absence of any direct instructions from 

the City. 

(b) Moneys held for the credit of the Construction Fund 

may be invested and reinvested pursuant to the direction of the City in Permitted Investments which shall mature, or which shall be 

subject to redemption by the hOlder thereof, at the option of such 

holder, not later than the date or dates when such money will be 

required for the purposes intend~d. 

(c) Moneys held for the credit of the Bond Fund (other than the Debt Service Reserve Account) shall be invested an.O. 

reinvested in Permitted Investments, which shall mature, or which 

shall be subject to redemption by the holder thereof, at the option 

of such holder, not later than the date or dates when the moneys 

will be required for payment of the principal of and interest on the 

bonds when due. The Trustee shall invest and reinvest pursuant to 

the direction of the city and in the Trustee's discretion in the 

absence of any direct instructiofls from the City. 

(d) Obligations so purchased as an investment of moneys in any fund shall be deemed at all times to be a part of such fund 

and the .interest accruipg the~eon and any profit realized from such 

investments shall be credited to such fund, and any loss r~sulting 

from such investment Shall be charged to such fund, except that 

moneys in the Debt Service Reserve Account in the Bond Fund in 

excess of the Required Level shall be transferred from time to time 

out of the Debt Service Reserve Account into the Sales and Use Tax 

Account. 

(e) Investments of moneys in all funds shall be valued 

in terms of current market value at least annually. 

section 19. In the event the office of Mayor, City Treasurer, city Clerk or City Council shall be abolished or any two 

or more of such offices shall be merged or consolidated or in the 

event the duties of a particular office shall be transferred to 

22 

• 

... 
another office or offices, or in the event of a vacancy in any such 

office by reason of death, resignation, removal from office or 

otherWise, or in the event any such officer shall become incapable 

of performing the duties of his office by reason of sickness, 

absence from the City or otherwise, all powers conferred and all 

obligations and duties imposed upon such office or officer shall be 

performed by the office or officers succeeding to the principal 

functions thereof, or by the office or officer upon whom such 

powers, obligations and duties shall be imposed by law. 

section 20. Farmers Bank & Trust company, Magnolia, .. Arkansas is hereby appointed to act as Trustee and Paying Agent 

pursu~nt to this Ordinance. The Trustee shall be responsible for the 

exerc1se of good faith and reasonable prudence in the execution of 

its trusts. The recitals in this Ordinance and in the Bonds are the 

recitals of the city and not of the Trustee. The Trustee shall not 

be required to take any .action as Trustee unless it shall have been 

requested to do so in writing by the owners of not less than ten 

percent (10%) in principal amount of Bonds then outstanding and 

shall have been offered reasonable security and indemnity against 

the costs, expenses and liabilities to be incurred therein or 

thereby. The Trustee may resign by giving sixty (60) days' notice 

in writing to the City Clerk and to the owners of the Bonds, and th~ 

majority in principal amount of the owners of the outstanding Bonds 

at any time, with or without cause, may remove the Trustee. In the 

event of a vacancy in the office of Trustee, the majority in 

principal amount of the owners of the outstanding Bonds may appoint 

a new Trustee, such appointment to be evidenced by a written 

instrument or instruments filed ... with the City Clerk. If the 

majority in principal amount of the owners of the outstanding Bonds 

shall fail to fill a vacancy within thirty (30) days after the same 

shall occur, then the City shall forthwith designate a new Trustee 

by a written instrument filed in the office of the City Clerk. The 

new Trustee shall be a. bank or a trust company in good standing 

located in or incorporafed under the laws of the State of A~kansas, 

duly authorized to exerCise trust powers and subject to examination 

by federal or State of Arkansas authority, having a reported capital 

and surplus of not less than $5,000, 000. The Trustee and any 

successor Trustee shall file a written acceptance and agreement to 

execute the trusts imposed upon it by this Ordinance, but only upon 

the terms and conditions set forth in this Ordinance and subject to 

the provisions of this Ordinance, to all of which the respective 

owners of the Bonds agree4 Such written acceptance ·Shall be filed 

with the City Clerk, and a copy thereof shall be placed in the bond 

transcript. Any successor Trustee shall have all the powers ·herein 

granted to the original Trustee. The Trustee's resignation shall 

take effect upon the acceptance of the trusts by the successor 

Trustee. 

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.. 30 

.. 
Section 21. (a) The terms of this Ordinance shall constitute a contract between the City and the owners of the Bonds 

and no variation or change in the undertaking herein set forth shall 

be made while any of the Bonds are outstanding, except as 

hereinafter set forth in subsections (b) and (c), and the owner of 

any Bonds may at any time for and on his own behalf or for and on behalf of all bondholders enforce the obligations of the City by a 

proper suit for that purpose. 

(b) The Trustee may consent to any variation or change in this Ordinance in order to cure any ambiguity, defect or omissiofl 

in this ordinance or any amendment hereto without the consent of the 

owners of the outstanding Bonds. 

(c) The owners of not less than seventy-five percent 

(75%) in aggregate principal amount of the Bonds then outstanding 

shall have the right, from time to time, anything contained in this 

Ordinance to the contrary notwithstanding, to consent to and approve 

the adoption by the City of such ordinance supplemental hereto as 

shall be necessary or desirabl~ for the purpose of modifying, altering, amending, adding to or rescinding, in any particular, any 

of the terms or provisions contained in this Ordinance or in any supplemental ordinance; provided, however, that nothing contained in 

this Section shall permit or be construed as permitting (1) an 

extension of the maturity of the principal of or the interest on any 

Bond, or (2) a reduction in the principal amount of any Bond or the rate of interest thereon, pr (3) the creation of a plepge of the Ad 

Valorem Tax Revenues or the Sales and Use Tax Revenues superior to 

the pledges created by this O~dinance, or (4) a privilege or priority of any Bond or Bonds over any other Bond or Bonds, or (5) 

a reduction in the aggregate principal amount of the Bonds required 

for consent to such supplemental ordinance. 

Section 22. , (a) The City covenants that it shall not 

take any action or suffer or permit any action to be taklen or 

condition to exist which causes or may cause the interest payable on 

the Series 1997 Bonds to be included in gross income for federal 

income tax purposes. Without limiting the generality of the foregoing, the City covenants that the proceeds of the sale of the 

Series 1997 Bonds and the Ad Valorem Tax Revenues or the Sales and 

Use Tax Revenues will not be used directly or indirectly in such 

manner as to cause the Series 1997 Bonds to be treated as "arbitrage bonds" within the meaning of section 148 of the Code. 

(b) The City represents that it has not used or permitted the use of, and covenants that it will not use or permit 

the use of the facilities financed by the Bonds Refunded or the 

proceeds of the Bonds or the Refunded Bonds, in such manner· as to 

24 

31. 
cause the Bonds to be 11 private activity bonds 11 within the meaning of 

Section 141 of the Code. In this regard, the City shall assure that 

(1) not in excess of 10% of the Net Proceeds of the Series 1997 

bonds is used for Private Business use if, in addition, the payment 

of more than 10% of the principal or 10% of the interest due on the 

Series 1997 Bonds during the ~erm thereof is, under the terms of the 

Series 1997 Bonds or any underlying arrangement, directly or 

indirectly secured by any interest in property used or to be used 

for a Private Business Use or in payments in respect of property used or to be used for a Private Business Use or is to be derived 

from payments,·whether or not to the City, in respect of property o~ 

borrowed moneys used or to be used for a Private Business Use; and 

(2) in the event that both (A) in excess of 5% of the Net Proceeds 

of the Series 1997 Bonds are used for a Private Business Use, and 

(B) an amount in excess of 5% of the principal or 5% of the interest 

due on the Series 1997 Bonds dUring the term thereof is, under the 

terms of the Series 1997 Bonds or any underlying arrangement, 

directly or indirectly, secured by any interest in property used or 

to be used for such Private Business Use or in payments in respect 

of property used or to be used fqr such Private Business Use or is 

to be derived from payments, whether or not to the City, in respect of property or borrowed money used or to be used for such Privat~ 

Business Use, then such excess over five percent (5%) of Ne·t 

Proceeds of the bonds used for a Private Business Use shall be used 

for a Private Business use related to the governmental use of the 

improvements financed by the Series 1997 Bonds. 

As used in this subsection: 

"Net Proceeds 11 means fhe face amount of the Series 1997 

Bonds plus accrued interest and premium, if any, less original issue 

discount, if any, less any proceeds deposited into the Debt Service 

Reserve Account. 

"Private Business Use 11 means use directly or indirectly 

in a trade or businesS carried on by a natural person or in any 

activity carried on by a person other than a natural person, excluding, however, use by a state or local governmental unit and 

use as a member of the general public. 

(c) The Series 1997 Bonds are hereby designated as 

"qualified tax-exempt obligations 11 within the meaning of Section 265 

of the Code. The City represents that it does not reasonably expect 

that the aggregate principal amount of its qualified tax-exempt 

obligations (excluding "private activity bonds" within the meaning of section 141 of the Code which are not "qualified 501(c) (3) bonds 11 

within the meaning of section 145 of the Code), including those of 

25 

3Z 
i1:s subordinate entities, issued in the ·current calendar year will 

exceed $10,000,000. 

(d) 

Section 148 of 

therein) : 

The City covenants 

the Code (and within 

as follows 

the meaning 

with respect to 

of the terms used 

(1) The average maturity of the series 1997 Bonds does 

not exceed the average maturity of the Refunded Bonds. 

(2) None of the Refunded .Bonds is a "private activity 

bond11 • 

( 3) 

Bonds was 

At least 95% of the "net proceeds" of the Refunded 

used for governmental activities of the City. 

{ 4) The Refunded Bonds were treated as meeting the 

requirements fo Section 148 (f) (2) an (3) by virtue of Section _, 

148 (f) (4) (D) (v). 

(5) The aggregate principal amount of all bonds issued 

by the City (other than 11 private activity bonds") during th~ 

years 1990 and 1991 did not exceed $5,000, ooo (in eith~r 

year) . 

Section 23. The City covenants that it will take no 

action which would cause the Series 1997 Bonds to be 11 federally 

guaranteed11 within the meaning .of Section 149(b) .'of the Code; 

specifically, (A} the payment of any portion of principal or 

interest with respect to the _,Series 1997 Bonds will not be 

guaranteed (directly or indirectly) by the United States or any 

agency or instrumentality thereof and (B) none of the proceeds of 

the Series 1997 Bonds (exclusive of proceeds invested for an initial 

temporary period until, needed for the purpose for which the bonds 

were issued and proceeds deposited into the Bond Fund) w~l~ be 

invested (directly or 'lndirectly) in federally insured dep'osits or 

accounts. Nothing in this Section shall prohibit investments in 

obligations issued by the United States Treasury. 

Section 24. The City covenants that it will submit to 

the Secretary of the Treasury of the United States, not later than 

the 15th day of the second calendar month after the close of the 

calendar quarter in which the Bonds are issued, a statement 

concerning the Bonds which contains the information required by 

Section 149(e) of the Code. 

Section 25. The provisions of 

severable and in the event that any section or 

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this Ordinance are 

part hereof shall be 

26 
held to be invalid, such invalidity shall not affect the remainder 

of this Ordinance. 

Section 26. All ordinances and resolutions and parts 

thereof in conflict herewith are hereby repealed to the extent of 

such conflict. 

Section 27. This Ordinance shall not create any right of 

any character and no right of any character shall arise under or 

pursuant hereto until the Bonds authorized hereby shall be issued 

and delivered. 

Section 28. It is hereby ascertained and declared that 

the Refunding will result in savings to the City from the date that 

it is effected and that issuance of the series 1997 Bonds is 

dependent upon economic conditions (which are continually changing). 

These purposes cannot be accomplished without the issuance of the 

Series 1997 Bonds, and therefore it is declared that an emergency 

exists and this Ordinance being necessary for the preservation of 

the public peace, health and saf~ty shall be in force immediately 

upon and after its passage. 

PASSED: ---------------' 1997. 

ATTEST: 

~J;2 d£:;- City clerk ~ 

APPRO \tED: (\ 

_. ~~IYtr'cJ Mayor . 

(SEAL) 

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CERTIFICATE 

The undersigned, City Clerk of the City of Newport, 

Arkansas, hereby certifies that the foregoing pages are a true and 

correct copy of Ordinance No. 1002 , passed at a regular 

session of the City Council c: the City, held at the ~eau~ar ~eeti~~ 

p:ace of the Council on the 18th .day of Februar\· l99'7, ar.d 

that the Ordinance is of record in Ordinance Record Book No. 

at Page now in my possession. 

GIVEN under my hand and seal this 

February, 1997. 

18th day of 

~r~.;:~ City CleT 

(SEAL) 

. f:1homo\by\no:wpl:l,ord 

Fcbn-.1)· 1~. IWI 

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