CITY OF MASON
COUNCIL CHAMBERS
201 W. ASH ST., MASON, MICHIGAN
MASON CITY COUNCIL
MINUTES
September 3, 2002
The
meeting was called to order at 7:33 p.m. by Mayor Whipple.
Present: Council Members: Preadmore, Helbig,
Clark, Howe, Whipple
Absent: Council
Members: Naeyaert, Soule
Also
present: Martin Colburn, City
Administrator
Kathy
Revels, Finance Director/Treasurer
Deborah
Stein, Deputy Clerk
Mayor
Whipple led in the Pledge of Allegiance and offered the invocation.
APPROVAL
OF MINUTES - REGULAR COUNCIL MEETING: August 19, 2002
The
Minutes of August 19, 2002 were approved as written.
APPROVAL
OF BILLS
Motion by
Howe, supported by Preadmore,
To approve
the payment of the bills in the amount of $94,991.01 as submitted.
VOTE: Yes (5)
Preadmore, Helbig, Clark, Howe, Whipple
No
(0)
MOTION
CARRIED
PEOPLE
FROM THE FLOOR
·
None
REGULAR
BUSINESS
Resolution
No. 2002-41
was introduced by Preadmore and supported by Howe.
CITY OF MASON
CITY COUNCIL
RESOLUTION NO. 2002-41
SALES RESOLUTION FOR
REFUNDING BONDS
City of Mason,
Ingham County, Michigan (the “City”).
At a regular meeting
of the City Council of the City of Mason, Ingham County, Michigan, was held in
the City Hall, 201
West Ash Street,
Mason, Michigan, on Tuesday, the 3rd day of September, 2002, at 7:30 o’clock,
p.m.
The meeting was
called to order by Mayor Whipple.
Present: City Council Members Preadmore, Howe, Whipple, Clark and
Helbig
Absent: City Council Members Naeyaert and Soule
The following
preamble and resolution were offered by City Council Member Preadmore and
supported by City Council Member Howe.
WHEREAS:
1. By
Ordinance No. 137, adopted August 5, 2002 (the "Bond Ordinance"),
City of Mason, Ingham County, Michigan, (the "Issuer") authorized the
issuance of $690,000 Water Supply and Sewage Disposal System Revenue Refunding
Bonds, Series 2002 (the "Bonds") for the purpose of refunding the
Issuer's Water Supply and Sewage Disposal System Revenue Bonds, Series 1990,
maturing on May 1 in the years 2003 through 2006, inclusive (the "Refunded
Bonds"); and
2. The
City has achieved qualified status under Act 34, Public Acts of Michigan, 2001,
as amended; and
3. In
the Bond Ordinance, the City Council authorized the sale of the Bonds upon
terms to be approved by the City Council at the time of sale; and
4. The
Issuer has received an offer to purchase the Bonds from Mason State Bank,
Mason, Michigan (the "Bank"), and the City Council has determined
that it is in the best interests of the Issuer to accept the offer.
NOW,
THEREFORE, BE IT RESOLVED THAT:
1. The
offer of the Bank presented to the City Council to purchase the bonds in the
principal amount of $690,000 at a purchase price of $690,000 is hereby
accepted. The Bonds shall be issued in
the aggregate principal sum of $690,000, designated Water Supply and Sewage
Disposal System Revenue Refunding Bonds, Series 2002.
2. The
Bonds shall be dated September 13, 2002, and shall mature on May 1 of the years
2003 through 2006, inclusive, on which interest is payable on each May 1 and
November 1, commencing May 1, 2003, at the rates and in the principal
amounts set forth in Exhibit A. The Bonds shall not be subject to redemption
prior to maturity.
3. The
Bond Registrar shall keep or cause to be kept, at its principal office,
sufficient books for the registration and transfer of the Bonds, which shall at
all times be open to inspection by the Issuer; and, upon presentation for such
purpose, the Bond Registrar shall, under such reasonable regulations as it may
prescribe, transfer or cause to be transferred on said books, Bonds as herein
provided.
Any Bond may be transferred upon the books
required to be kept pursuant to this section by the person in whose name it is
registered, in person or by a duly authorized agent, upon surrender of the Bond
for cancellation, accompanied by delivery of a duly executed written instrument
of transfer in a form approved by the Bond Registrar. Whenever any Bond or Bonds shall be surrendered for transfer, the
Issuer shall furnish or cause to be furnished a sufficient number of manual or
facsimile executed Bonds and the Bond Registrar shall authenticate and deliver
a new Bond or Bonds for like aggregate principal amount. The Bond Registrar shall require the payment
of any tax or other governmental charge required to be paid with respect to the
transfer to be made by the bondholder requesting the transfer.
4. Blank
Bonds with the manual or facsimile signatures of the Mayor and Clerk of the
City affixed thereto, shall, upon issuance and delivery and from time to time
thereafter as necessary, be delivered to the Bond Registrar for safekeeping to
be used for registration and transfer of ownership.
The Bonds are registered as to principal
and interest and are transferable as provided in the Bond Ordinance only upon
the books of the Issuer kept for that purpose by the Bond Registrar, by the
registered owner thereof in person or by an agent of the owner duly authorized
in writing, upon the surrender of the Bond together with a written instrument
of transfer satisfactory to the Bond Registrar duly executed by the registered
owner or agent thereof and thereupon a new Bond or Bonds in the same aggregate
principal and of the same maturity shall be issued to the transferee in
exchange therefor as provided in the Bond Ordinance and upon payment of the
charges, if any, therein provided. The
Bonds are issuable in denominations of $5,000 or any integral multiple thereof
not exceeding the aggregate principal amount for each maturity.
If any Bond shall become mutilated, the
Issuer, at the expense of the holder of the Bonds, shall furnish or cause to be
furnished, and the Bond Registrar shall authenticate and deliver, a new Bond of
like tenor in exchange and substitution of the mutilated Bond, upon surrender
to the Bond Registrar of the mutilated Bond.
If any Bond issued under this resolution shall be lost, destroyed or
stolen, evidence of the loss, destruction or theft and indemnity may be
submitted to the Bond Registrar, and if satisfactory to the Bond Registrar and
the Issuer, the Issuer at the expense of the owner, shall furnish or cause to
be furnished, and the Bond Registrar shall authenticate and deliver a new Bond
of like tenor and bearing the statement required by Act 354, Public Acts of
Michigan, 1972, as amended, being sections 129.131 to 129.135, inclusive, of
the Michigan Compiled Laws, or any applicable law hereafter enacted, in lieu of
and in substitution of the Bond so
lost, destroyed or stolen. If any such
Bond shall have matured or shall be about to mature, instead of issuing a
substitute Bond, the Bond Registrar may pay the same without surrender thereof.
5. Upon
delivery of the Bonds, the proceeds of the Bonds and other funds shall be used
as follows:
A. The
approximate sum of $11,625 shall be used to pay the costs of issuance of the
Bonds, and any balance remaining from that sum after paying the costs of
issuance shall be deposited in the Bond and Interest Redemption Fund for the
Bonds.
B. The
approximate sum of $678,375 from the Bonds shall be paid to the Escrow Agent
and, together with funds on hand of the Issuer in the approximate amount of
$21,756.25, then held by it as provided in the Bond Ordinance and
Exhibit D of the Escrow Agreement for payment of principal of and interest
on the Refunded Bonds. Any funds from
the Bond proceeds not used for the Escrow Account shall be deposited in the
Costs of Issuance Fund.
6. Fifth
Third Bank, Michigan, Grand Rapids, Michigan, is hereby approved as Escrow
Agent under the proposed Escrow Agreement (the "Escrow Agreement"),
attached hereto as Exhibit B. The
Escrow Agreement providing for payment and redemption of the Refunded Bonds is
hereby approved in its substantial form as attached as Exhibit B. The Mayor or Clerk shall execute and deliver
the Escrow Agreement substantially in the form presented to the City Council
with such changes and completions as shall be necessary as determined by Thrun,
Maatsch and Nordberg, P.C., in order to accomplish refunding the Refunded Bonds
in accordance with the law, and the Bond Ordinance. The Escrow Agent is further authorized to act as the Issuer's
agent and attorney-in-fact for the purpose of acquiring on behalf of the Issuer
the federal securities, if necessary, as defined in the Escrow Agreement to
meet the City Council's obligations under the Escrow Agreement.
7. The
Mayor and Clerk are hereby authorized to provide the Bonds in conformity with
the specifications of this resolution by causing their manual or facsimile signatures
to be affixed thereto, and upon the manual execution by the authorized
signatory of the Bond Registrar, the Finance Director/Treasurer be and is
hereby authorized and directed to cause said Bonds to be delivered to the Bank
upon receipt of the purchase price and accrued interest, if any.
8. The
Mayor, Clerk and Finance Director/Treasurer, and all other officers, agents and
representatives of the Issuer and each of them shall execute, issue and deliver
any certificates, statements, warranties, representations, or documents
necessary to effect the purposes of this resolution or the Bond.
9. The
officers, agents and employees of the Issuer are authorized to take all other
actions necessary and convenient to facilitate sale and delivery of the Bonds.
10. The Issuer hereby designates the
Bonds of this issue as "qualified tax‑exempt obligations" for
purposes of deduction of interest expense by financial institutions under the
provisions of the Internal Revenue Code of 1986, as amended. In making said designation, the City Council
determines that the reasonably anticipated amount of tax‑exempt
obligations which will be issued by the Issuer or entities which issue
obligations on behalf of the Issuer during calendar year 2002 will not exceed
$10,000,000.
11. The
Issuer hereby appoints Mason State Bank, Mason, Michigan, as Bond
Registrar-Paying Agent and directs the Clerk or Finance Director/Treasurer to
execute for and on behalf of the Issuer a Bond Registrar-Paying Agent
Agreement, if necessary.
12. All
resolutions and parts of resolutions insofar as they conflict with the
provisions of this resolution be, and the same are, hereby rescinded.
Ayes: City
Council Members Preadmore,
Howe, Whipple, Clark and Helbig
Nays: City Council Members None
Resolution declared adopted.
______________________________
Clerk, City of Mason
The undersigned, duly qualified and
acting Clerk of the City of Mason, Ingham county, Michigan, hereby certifies
that the foregoing constitutes a true and complete copy of a resolution adopted
by said City Council at a regular meeting held on September 3, 2002, the
original of which is part of the City Council’s minutes. The undersigned
further certifies that notice of the meeting was given to the public pursuant
to the provisions of the "Open Meetings Act" (Act 267, PA 1976, as
amended).
______________________________
Clerk, City of Mason
EXHIBIT
A
Maturity Amount Rate
May 1, 2003 $165,000 3.00%
May 1, 2004 $170,000 3.00
May 1, 2005 $175,000 3.00
May 1, 2006 $180,000 3.00
EXHIBIT
B
ESCROW
AGREEMENT
CITY
OF MASON
COUNTY
OF INGHAM
STATE
OF MICHIGAN
Water Supply and
Sewage Disposal System Revenue
Refunding
Bonds, Series 2002
THIS ESCROW
AGREEMENT (the "Agreement") dated as of the _____ day of September,
2002, made by and between the City of Mason (the "Issuer") and Fifth
Third Bank, Michigan, Grand Rapids, Michigan (the "Escrow Agent").
W
I T N E S S E T H :
WHEREAS, there are
presently outstanding $675,000 in principal amount of Water Supply and Sewage
Disposal System Revenue Bonds, Series 1990 of the Issuer dated July 1, 1990
(the "Prior Bonds"); and
WHEREAS, the Prior
Bonds mature serially in such years and bear interest at such rates as set
forth on Exhibit A, attached hereto and made a part hereof; and
WHEREAS, the Issuer
now desires to refund that portion of the Issuer's Prior Bonds which are due
and payable May 1, 2003 through May 1, 2006, inclusive (the "Refunded
Bonds"), and to pay the costs of issuance of the Water Supply and Sewage
Disposal System Revenue Refunding Bonds, Series 2002 (the "Bonds");
and
WHEREAS, the Issuer
has adopted an ordinance and a resolution authorizing the issuance of the Bonds
for the purpose of providing amounts sufficient, together with other available
funds, to provide for the payment of the principal of and interest on and
redemption premiums on the Refunded Bonds on the dates and in the amounts shown
on Exhibit D attached hereto; and
WHEREAS, the Issuer
desires to provide for the deposit of part of the proceeds of its Bonds,
together with funds on hand in the Bond and Interest Redemption Fund and the
Bond Reserve Account, with the Escrow Agent to provide for the payment of the
interest on the Refunded Bonds to their call date and for the call for
redemption on their call date, of the entire outstanding principal amount of
the Refunded Bonds maturing in the years described above; and
WHEREAS, the Issuer
desires to enter into an escrow agreement with the Escrow Agent to provide for
the safekeeping, investment, reinvestment, administration and disposition of
any such deposit, upon such terms and conditions herein set forth; and
WHEREAS, the Issuer
desires that, concurrently with the delivery of the Bonds to the purchasers
thereof, a portion of the proceeds of the Bonds, together with other available
funds, shall be applied to purchase certain direct obligations of or
obligations the principal of and interest on which are unconditionally
guaranteed by the United States of America, or other obligations the principal
of and interest on which are fully secured by the foregoing for deposit to the
credit of the Escrow Fund created pursuant to the terms of this Agreement and
to establish a beginning cash balance in the Escrow Fund; and
WHEREAS, by
resolution adopted on September 3, 2002, the City Council of the Issuer duly
authorized the execution of this Agreement, a certified copy of which
resolution has been filed with the Escrow Agent.
NOW, THEREFORE, in
consideration of the mutual undertakings, promises and agreements herein
contained, the sufficiency of which hereby are acknowledged, and to secure the
full and timely payment of the principal of, the interest on and the redemption
premiums on the Refunded Bonds, the Issuer and the Escrow Agent mutually
undertake, promise, and agree for themselves and their respective
representatives and successors, as follows:
ARTICLE
I
DEFINITIONS
AND INTERPRETATIONS
Section 1.01. Definitions. Unless the context clearly indicates
otherwise, the following terms shall have the meanings assigned to them below
when they are used in this Agreement.
"Bonds"
means the Issuer's Water Supply and Sewage Disposal System Revenue Refunding
Bonds, Series 2002, dated September 13, 2002.
"Code"
means the Internal Revenue Code of 1986, as amended, and the rules and
regulations thereunder.
"Escrow
Agent" means Fifth Third Bank, Michigan, Grand Rapids, Michigan, and
its successors as Escrow Agent under this Agreement.
"Escrow Fund"
means the Water Supply and Sewage Disposal System Revenue Refunding Bonds,
Series 2002 Escrow Fund created and described in Section 3.01 of this
Agreement.
"Issuer"
means the City of Mason.
"Ordinances"
means the ordinance and resolution adopted by the City Council of the Issuer on
August 5, 2002 and September 3, 2002, respectively, authorizing the issuance,
sale and delivery of the Bonds and, among other things, authorizing and
approving this Agreement.
"Prior Bonds"
means bonds of the Issuer designated Water Supply and Sewage Disposal System
Revenue Bonds, Series 1990, dated July 1, 1990 as set forth in Exhibit A.
"Prior Bonds
Ordinances" means the Ordinance No. 106 duly adopted by the City
Council of the Issuer on May 7, 1979, Ordinance No. 119 adopted by the City
Council of the Issuer on March 16, 1987, and Ordinance No. 122, adopted by the
City Council of the Issuer on June 4, 1990.
"Redemption
Notification Date" means September 16, 2002.
"Refunded
Bonds" means those bonds of the Prior Bonds being refunded pursuant to
the terms of this Agreement and which are more fully described in
Exhibit B.
"Refunded
Bonds Paying Agent" means U.S. Bank National Association.
"SLGs"
means United States Treasury Demand Deposits, Certificates of Indebtedness,
Notes and Bonds ‑‑ State and Local Government Series.
Section 1.02. Interpretations. The titles and headings of the articles and
sections of this Agreement have been inserted for convenience and reference only
and are not to be considered a part hereof and shall not in any way modify or
restrict the terms hereof. This
Agreement and all of the terms and provisions hereof shall be liberally
construed to effectuate the purposes set forth herein and to achieve the
intended purpose of providing for the refunding of the Refunded Bonds in
accordance with applicable law.
ARTICLE
II
DEPOSIT
OF FUNDS AND
ESCROWED
SECURITIES
Section 2.01. Deposits in the Escrow Fund. The Issuer has deposited, or caused to be
deposited, in the Escrow Fund the following money:
(a) $711,756.25 as the remaining cash
balance for the Escrow Fund from the purchase of the Escrowed Securities,
provided such sum shall be held as vault cash until required herein.
ARTICLE
III
CREATION
AND OPERATION OF ESCROW FUND
Section 3.01. Creation of Escrow Fund. The Escrow Agent has created on its books a
special and irrevocable escrow fund to be known as the Water Supply and Sewage
Disposal System Revenue Refunding Bonds, Series 2002 Escrow Fund. The Escrow Agent hereby acknowledges that
there has been deposited to the credit of such Escrow Fund the Escrowed
Securities as described in Section 2.01 and the remaining cash balance from the
purchase of the Escrowed Securities.
The Escrowed Securities and all proceeds therefrom shall be the property
of the Escrow Fund, and shall be applied only in strict conformity with the
terms and conditions of this Agreement.
All of the Escrowed Securities, all proceeds therefrom and all cash
balances from time to time on deposit in the Escrow Fund are hereby irrevocably
pledged to the payment of the principal of and interest and redemption premiums
on the Refunded Bonds, which payment shall be made by a timely transfer to the
Refunded Bonds Paying Agent in such amounts and at such times as are provided
for in Section 3.02 hereof. When the
final transfer has been made to the Refunded Bonds Paying Agent for the payment
of the principal of and interest on and redemption premiums on the Refunded
Bonds in accordance with Exhibit D, any balance then remaining in the Escrow
Fund shall be transferred to the Issuer, and the Escrow Agent shall thereupon
be discharged from any further duties hereunder.
Section 3.02. Payment of Principal and Interest. The Escrow Agent is hereby irrevocably
instructed to transfer to the Refunded Bonds Paying Agent from the cash
balances from time to time on deposit in the Escrow Fund, the amounts required
to pay the principal of and interest and redemption premiums on the Refunded
Bonds in the amounts and at the times shown on Exhibit D attached hereto.
Section 3.03. Sufficiency of Escrow Fund. The Issuer represents that the successive
receipts of the principal of and interest on the Escrowed Securities will
assure that the cash balance on deposit from time to time in the Escrow Fund
will be at all times sufficient to provide moneys for transfer to the Refunded
Bonds Paying Agent at the times and in the amounts required to pay the interest
on the Refunded Bonds as such interest comes due, the principal of the Refunded
Bonds as the Refunded Bonds mature or are redeemed prior to their maturity, and
the redemption premiums on the Refunded Bonds called for redemption prior to
maturity, all as more fully set forth in Exhibit D attached hereto. If, for any reason, at any time, the cash
balances on deposit or scheduled to be on deposit in the Escrow Fund shall be
insufficient to transfer the amounts required by the Refunded Bonds Paying
Agent to make the payments set forth in Section 3.02 hereof, the Issuer shall
timely deposit in the Escrow Fund, from lawfully available funds, additional
funds in the amounts required to make such payments. Notice of any such insufficiency shall be given promptly as
hereinafter provided, but the Escrow Agent shall not in any manner be
responsible for any insufficiency of funds in the Escrow Fund or the Issuer's
failure to make additional deposits thereto.
Section 3.04. Operation of Escrow Fund. The Escrow Agent shall hold at all times the
Escrow Fund, the Escrowed Securities and all other assets of the Escrow Fund,
as special trust funds, but need not segregate such funds and securities except
to the extent required by law; and it shall hold and dispose of the assets of
the Escrow Fund only as set forth herein.
The Escrowed Securities and other assets of the Escrow Fund always shall
be maintained by the Escrow Agent as escrow funds for the benefit of the
holders of the Refunded Bonds; and a special account thereof shall at all times
be maintained on the books of the Escrow Agent. The holders of the Refunded Bonds shall be entitled to the same
preferred claim and first lien upon the Escrowed Securities, the proceeds
thereof and all other assets of the Escrow Fund to which they were entitled as
holders of the Refunded Bonds. The
amounts received by the Escrow Agent under this Agreement shall not be
considered as a banking deposit by the Issuer, and the Escrow Agent shall have
no right to title with respect thereto except in its capacity as Escrow Agent
under the terms of this Agreement. The
amounts received by the Escrow Agent under this Agreement shall not be subject to
warrants, drafts or checks drawn by the Issuer or by the Refunded Bonds Paying
Agent.
Section 3.05. Security for Cash Balances. Cash balances from time to time on deposit
in the Escrow Fund shall, to the extent not insured by the Federal Deposit Insurance
Corporation or its successor, be continuously secured by a pledge of direct
obligations of, or obligations unconditionally guaranteed by, the United States
of America, having a market value at least equal to such cash balances.
ARTICLE
IV
REDEMPTION
OF REFUNDED BONDS
Section 4.01. The Issuer shall notify the Refunded Bonds
Paying Agent no later than the Redemption Notification Date for the Refunded
Bonds due to be redeemed that it is necessary to take all steps required by the
Prior Bonds Ordinances to call the Refunded Bonds for redemption on the call
date as shown in the Notice of Redemption in substantially the form attached
hereto as Exhibit E, including giving notice of redemption by publication and
by mail as provided in the Prior Bonds Ordinances. The Refunded Bonds Paying Agent may make any corrections which it
deems necessary to the Notice of Redemption or make any revisions which it
deems appropriate to conform to market practice and legal requirements at the
time the Notice of Redemption is given.
ARTICLE
V
LIMITATION
ON INVESTMENTS
Section 5.01. General Prohibition. Moneys in the Escrow Fund and the proceeds
of the Escrowed Securities shall not be invested or reinvested except in United
States Treasury Demand Deposits, Certificates of Indebtedness, Notes and Bonds ‑‑
State and Local Government Series and except as provided in this
Article V.
Section 5.02. Investment or Reinvestment of Moneys. At the direction of the Issuer, the Escrow
Agent shall invest or reinvest the moneys held in the Escrow Fund provided that
the Issuer delivers to the Escrow Agent the following:
(a) an opinion by an independent
certified public accountant that after such investment or reinvestment, the
principal amount of the securities in the Escrow Fund together with the
interest thereon and other available moneys will be sufficient to pay, as the
same become due in accordance with Exhibit D, the principal of and interest on
and redemption premiums on the Refunded Bonds which have not been paid
previously; and
(b) an opinion of nationally recognized
municipal bond counsel, which may be rendered in reliance upon an opinion by an
independent certified public accountant with respect to the yield of the Bonds
and the yield of the securities in the Escrow Fund purchased with proceeds of
the Bonds, to the effect that (1) such investment will not cause the Bonds or
the Refunded Bonds to be "arbitrage bonds" within the meaning of
Section 148 of the Code and the regulations thereunder in effect on the date of
such investment, or otherwise make the interest on the Bonds or the Refunded
Bonds subject to Federal income taxation, and (2) such investment or
reinvestment complies with the Constitution and laws of the State of Michigan
and with all relevant documents relating to the issuance of the Bonds and
Refunded Bonds.
Section 5.03. Transfer of Excess Amounts. If at any time through redemption or
cancellation of the Refunded Bonds or through deposit of additional moneys or
non‑callable direct obligations of the United States of America or by
reason of an investment or reinvestment pursuant to Section 5.02 of this
Agreement there exists or will exist excesses of cash or interest on or
maturing principal of the securities in the Escrow Fund hereunder for the
Refunded Bonds, the Escrow Agent may transfer such excess amounts to or on the
order of the Issuer provided that the Issuer delivers to the Escrow Agent the
following:
(a) an opinion by an independent
certified public accountant that after the transfer of such excess the principal
amount of securities in the Escrow Fund, together with the interest thereon and
other available moneys, will be sufficient to pay, as the same become due in
accordance with Exhibit D, the principal of and interest on and redemption
premiums on the Refunded Bonds which have not been paid previously; and
(b) an opinion of nationally recognized
municipal bond counsel, which may be rendered in reliance upon an opinion by an
independent certified public accountant with respect to the yield of the Bonds
and the yield of the securities in the Escrow Fund purchased with proceeds of
the Bonds, to the effect that (1) such transfer will not cause the Bonds or the
Refunded Bonds to be "arbitrage bonds" within the meaning of Section
148 of the Code and the regulations thereunder in effect on the date of such
transfer, or otherwise make the interest on the Bonds or the Refunded Bonds
subject to Federal income taxation, and (2) such transfer complies with the
Constitution and laws of the State of Michigan and with all relevant documents
relating to the issuance of the Bonds and the Refunded Bonds.
Section 5.04. Arbitrage. The Issuer hereby covenants and agrees that it shall never
request the Escrow Agent to exercise any power hereunder or permit any part of
the money in the Escrow Fund or proceeds from the sale of Escrowed Securities
to be used directly or indirectly to acquire any securities or obligations if
the exercise of such power or the acquisition of such securities or obligations
would cause the Bonds or the Refunded Bonds to be "arbitrage bonds"
within the meaning of Section 148 of the Code.
ARTICLE
VI
RECORDS
AND REPORTS
Section 6.01. Records. The Escrow Agent will keep books of record and account in which
complete and correct entries shall be made of all transactions relating to the
receipts, disbursements, allocations and application of the money and Escrowed
Securities deposited in the Escrow Fund and all proceeds thereof, and such
books shall be available for inspection at reasonable hours and under
reasonable conditions by the Issuer and the holders of the Refunded Bonds.
Section 6.02. Reports. For the period beginning on the date hereof and ending on
December 31, 2002, the Escrow Agent shall prepare and send to the Issuer within
thirty (30) days following the end of such period a written report summarizing
all transactions relating to the Escrow Fund during such period, including, without
limitation, credits to the Escrow Fund as a result of interest payments on or
maturities of the Escrowed Securities and transfers from the Escrow Fund to the
Refunded Bonds Paying Agent for payments on the Refunded Bonds or otherwise,
together with a detailed statement of all Escrowed Securities, and the cash
balance on deposit in the Escrow Fund as of the end of such period.
ARTICLE
VII
CONCERNING
THE ESCROW AGENT
Section 7.01. Representations. The Escrow Agent hereby represents that it
has all necessary power and authority to enter into this Agreement and
undertake the obligations and responsibilities imposed upon it herein and that
it will carry out all of its obligations hereunder.
Section 7.02. Limitation on Liability. The liability of the Escrow Agent to
transfer funds to the Refunded Bonds Paying Agent for the payment of the
principal of, interest on and redemption premiums on the Refunded Bonds shall
be limited to the proceeds of the Escrowed Securities and the cash balances
from time to time on deposit in the Escrow Fund. Notwithstanding any provision contained herein to the contrary,
the Escrow Agent shall not have any liability whatsoever for the insufficiency
of funds from time to time in the Escrow Fund or any failure of the obligors of
the Escrowed Securities to make timely payment thereon, except for the
obligation to notify the Issuer promptly of any such occurrence.
The recitals herein
and in the proceedings authorizing the Bonds shall be taken as the statements
of the Issuer and shall not be considered as made by, or imposing any
obligation or liability upon, the Escrow Agent. The Escrow Agent is not a party to the Ordinances and is not
responsible for nor bound by any of the provisions thereof. In its capacity as Escrow Agent it is agreed
that the Escrow Agent need look only to the terms and provisions of this
Agreement; provided, however, that in the event of any conflict between the
terms of this Agreement and the terms of the Ordinances, the terms of the
Ordinances shall prevail.
The Escrow Agent
makes no representations as to the value, conditions or sufficiency of the
Escrow Fund, or any part thereof, or as to the title of the Issuer thereto, or
as to the security afforded thereby or hereby, and the Escrow Agent shall not
incur any liability or responsibility in respect to any of such matters.
It is the intention
of the parties hereto that the Escrow Agent shall never be required to use or
advance its own funds or otherwise incur personal financial liability in the
performance of any of its duties or the exercise of any of its rights and
powers hereunder.
The Escrow Agent
shall not be liable for any action taken or neglected to be taken by it in good
faith in any exercise of reasonable care and believed by it to be within the
discretion or power conferred upon it by this Agreement, nor shall the Escrow
Agent be responsible for the consequences of any error of judgment; and the
Escrow Agent shall not be answerable except for its own action, neglect or
default, nor for any loss unless the same shall have been through its
negligence or want of good faith.
Unless it is
specifically otherwise provided herein, the Escrow Agent has no duty to
determine or inquire into the happening or occurrence of any event or
contingency or the performance or failure of performance of the Issuer with
respect to arrangements or contracts with others, with the Escrow Agent's sole
duty hereunder being to safeguard the Escrow Fund, to dispose of and deliver
the same in accordance with this Agreement and to take all necessary action to
effect the call of the Refunded Bonds for redemption as provided in Article IV
of this Agreement. If, however, the
Escrow Agent is called upon by the terms of this Agreement to determine the
occurrence of any event or contingency, the Escrow Agent shall be obligated, in
making such determination, only to exercise reasonable care and diligence, and
in event of error in making such determination the Escrow Agent shall be liable
only for its own misconduct or its negligence.
In determining the occurrence of any such event or contingency the
Escrow Agent may request from the Issuer or any other person such reasonable
additional evidence as the Escrow Agent in its discretion may deem necessary to
determine any fact relating to the occurrence of such event or contingency, and
in this connection may make inquiries of, and consult with, among others, the
Issuer at any time .
Section 7.03. Compensation. The Issuer will pay to the Escrow Agent, as
fees for performing the services hereunder and for all expenses incurred or to
be incurred by the Escrow Agent in the administration of this Agreement, the
flat fee sum of $250. In the event that
the Escrow Agent is requested to perform any extraordinary services hereunder,
the Issuer hereby agrees to pay reasonable fees to the Escrow Agent for such
extraordinary services, and the Escrow Agent hereby agrees to look only to the
Issuer for the payment of such fees and reimbursement of such expenses. The Escrow Agent hereby agrees that in no
event shall it ever assert any claim or lien against the Escrow Fund for any
fees for its services, whether regular or extraordinary, as Escrow Agent or in
any other capacity, or for reimbursement for any of its expenses.
Section 7.04. Successor Escrow Agents. If at any time the Escrow Agent or its legal
successor or successors should become unable, through operation of law or
otherwise, to act as Escrow Agent hereunder, or if its property and affairs
shall be taken under the control of any state or federal court or
administrative body because of insolvency or bankruptcy or for any other reason,
a vacancy shall forthwith exist in the office of Escrow Agent hereunder. In such event the Issuer, by appropriate
resolution, shall promptly appoint an Escrow Agent to fill such vacancy. If no successor Escrow Agent shall have been
appointed by the Issuer within 60 days, a successor may be appointed by the
holders of a majority in principal amount of the Refunded Bonds then
outstanding by an instrument or instruments in writing filed with the Issuer,
signed by such holders or by their duly authorized attorneys-in-fact. If, in a proper case, no appointment of a
successor Escrow Agent shall be made pursuant to the foregoing provisions of
this section within three months after a vacancy shall have occurred, the
holder of any Refunded Bond may apply to any court of competent jurisdiction to
appoint a successor Escrow Agent. Such
court may thereupon, after such notice, if any, as it may deem proper,
prescribe and appoint a successor Escrow Agent.
Any successor Escrow
Agent shall be a corporation or association organized and doing business under
the laws of the United States or the State of Michigan, authorized under such
laws to exercise corporate trust powers, having its principal office and place
of business in the State of Michigan, having a combined capital and surplus of
at least $5,000,000 and subject to the supervision or examination by federal or
state authority.
Any successor Escrow
Agent shall execute, acknowledge and deliver to the Issuer and the Escrow Agent
an instrument accepting such appointment hereunder, and the Escrow Agent shall
execute and deliver an instrument transferring to such successor Escrow Agent,
subject to the terms of this Agreement, all the rights, powers and trusts of
the Escrow Agent hereunder. Upon the
request of any such successor Escrow Agent, the Issuer shall execute any and
all instruments in writing for more fully and certainly vesting in and
confirming to such successor Escrow Agent all such rights, powers and
duties. The Escrow Agent shall pay over
to its successor Escrow Agent a proportional part of the Escrow Agent's fee
hereunder.
ARTICLE
VIII
MISCELLANEOUS
Section 8.01. Notice. Any notice, authorization, request, or demand required or
permitted to be given hereunder shall be in writing and shall be deemed to have
been duly given when mailed by registered or certified mail, postage prepaid
addressed as follows:
To the Issuer:
City of Mason
Attn: Finance Director/Treasurer
201 W. Ash Street
Mason, MI 48854
To the Escrow Agent:
Fifth Third Bank
Corporate Trust
Administration
MD #ROPS53
1850 East Paris
Avenue, SE
Grand Rapids,
MI 49546‑6210
The United States
Post Office registered or certified mail receipt showing delivery of the
aforesaid shall be conclusive evidence of the date and fact of delivery. Any party hereto may change the address to
which notices are to be delivered by giving to the other party not less than
ten (10) days prior notice thereof.
Section 8.02. Termination of Responsibilities. Upon the taking of all the actions as
described herein by the Escrow Agent, the Escrow Agent shall have no further
obligations or responsibilities hereunder to the Issuer, the holders of the
Refunded Bonds or any other person or persons in connection with this
Agreement.
Section 8.03. Binding Agreement. This Agreement shall be binding upon the
Issuer and the Escrow Agent and their respective successors and legal
representatives, and shall inure solely to the benefit of the holders of the
Refunded Bonds, the Issuer, the Escrow Agent and their respective successors
and legal representatives.
Section 8.04. Severability. In case any one or more of the provisions
contained in this Agreement shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Agreement, but
this Agreement shall be construed as if such invalid or illegal or
unenforceable provision had never been contained herein.
Section 8.05. Michigan Law Governs. This Agreement shall be governed exclusively
by the provisions hereof and by the applicable laws of the State of Michigan.
Section 8.06. Time of the Essence. Time shall be of the essence in the
performance of obligations from time to time imposed upon the Escrow Agent by
this Agreement.
Section 8.07. Rights of Holders of Refunded Bonds. This Agreement shall not be terminated nor
amended in any manner that would adversely affect the rights of the holders of
the Refunded Bonds.
EXECUTED as of the
date first written above.
FIFTH
THIRD BANK, MICHIGAN CITY
OF MASON
GRAND RAPIDS, MICHIGAN COUNTY
OF INGHAM
STATE OF MICHIGAN
By By
Mayor
Title
-OR-
By
Clerk
EXHIBIT
A
PRIOR
BONDS
DATED
JULY 1, 1990
PRINCIPAL PRINCIPAL INTEREST
MATURITY
AMOUNT RATE
May 1, 2003 $150,000 6.90%
May 1, 2004 175,000 6.95
May 1, 2005 175,000 6.00
May 1, 2006 175,000 6.00
EXHIBIT
B
REFUNDED BONDS
DATED
JULY 1, 1990
PRINCIPAL PRINCIPAL INTEREST
MATURITY
AMOUNT RATE
May 1, 2003 $150,000 6.90%
May 1, 2004 175,000 6.95
May 1, 2005 175,000 6.00
May 1, 2006 175,000 6.00
EXHIBIT
C
[Reserved]
EXHIBIT
D
Date Principal Interest Premium Total
11/1/02 $675,000.00 $21,756.25 $3,375.00 $700,131.25
1/ Wire
Instruction: $700,131.25 wire
transferred to U.S. Bank National Association, ABA ________
______________________________ to credit __________ City of Mason Water Supply
and Sewage Disposal System Revenue Bonds, Series 1990 (ATTN: __________) on _______________, 2002.
EXHIBIT
E
NOTICE OF
REDEMPTION
CITY
OF MASON
COUNTY
OF INGHAM
STATE
OF MICHIGAN
WATER SUPPLY AND
SEWAGE DISPOSAL SYSTEM REVENUE
BONDS,
SERIES 1990
DATED
JULY 1, 1990
Notice is hereby given that the City of Mason
calls for redemption on November 1, 2002 (the "Redemption Date"), the
following maturities of the above-described bonds (the "Refunded
Bonds"), at a redemption price of 100.5% of the principal amount thereof
(the "Redemption Price") plus accrued interest to the Redemption
Date.
PRINCIPAL PRINCIPAL INTEREST
CUSIP MATURITY AMOUNT RATE
575280 BG 6 May 1, 2003 $150,000 6.90%
575280 BH 4 May 1, 2004 175,000 6.95
575280 BJ 0 May 1, 2005 175,000 6.00
575280 BK 7 May 1, 2006 175,000 6.00
The Refunded Bonds
should be delivered to the paying agent, U.S. Bank National Association, for
payment on November 1, 2002, after which time all interest on the Refunded
Bonds shall cease.
Interest on the
Refunded Bonds shall cease to accrue on the Redemption Date, and the holder of
any such Refunded Bonds shall not be entitled to any benefit under the
ordinance pursuant to which the Refunded Bonds were issued (except to receive
payment of the Redemption Price and accrued interest) on or after the Redemption
Date.
Clerk, City of Mason
Dated: September ______, 2002
Review of
Appeal - Special Use Permit for 321 N. Cedar - Cars-tu-Go
A letter
of appeal was submitted by appellant Jim Hyde and property owner Art Good on a
Planning Commission decision that was denied due to a tie vote.
Motion by
Howe, supported by Preadmore,
That the
letter of appeal on the Special Use Permit declined by the Planning Commission
for 321 N. Cedar does have standing in accordance with Section 7.3.3 of the
Zoning Ordinance.
VOTE: Yes (5)
Preadmore, Helbig, Clark, Howe, Whipple
No
(0)
MOTION
CARRIED
Motion by
Clark, supported by Preadmore,
To hold a
Hearing of Appeal for September 16, 2002 at 6:30 p.m. prior to the regular
meeting.
VOTE: Yes (5)
Preadmore, Helbig, Clark, Howe, Whipple
No
(0)
MOTION
CARRIED
Discussion followed that the letter submitted
by the appellant is not in compliance with Section 7.3.3 of the Zoning
Ordinance. A letter must be submitted
prior to Wednesday, September 10, 2002 stating the reason for appeal and the
general standards or specific criteria that the Planning Commission incorrectly
applied.
Purchase
of Property Access Line (PAL) - Finance Department
Discussion
was held on the Finance Department request to purchase PAL (Property Access
Line), an FTP software providing assessing, tax and utility information on line
or by phone. The information is
currently provided manually by city employees to title companies and the
like. PAL would be accessible by a link
on the city web site.
Motion by
Helbig, supported by Preadmore,
To approve
the purchase of the PALine.com in the amount of $10,500.
VOTE: Yes (5)
Preadmore, Helbig, Clark, Howe, Whipple
No
(0)
MOTION
CARRIED
Request -
Stag Thicket Street Closure for Picnic and Meeting
It was
discussed that a request was submitted to close Stag Thicket in Hunting Meadows
for the Hunting Meadows Property Owners Association annual meeting on Sunday,
September 8, 2002 at 4:00 p.m. in front of Stag Thicket addresses, 922 and 930
for their annual meeting and picnic.
Motion by
Howe, supported by Helbig,
To approve
the closure of Stag Thicket in front of 922 and 930 Stag Thicket on September
8, 2002 at 4:00 p.m. for the Hunting Meadows Property Owners Association annual
business meeting.
VOTE: Yes (5)
Preadmore, Helbig, Clark, Howe, Whipple
No
(0)
MOTION
CARRIED
Discussion
- MSHDA Funded Homeowner Assistance and Rental Rehabilitation Programs
Ingham
County Housing Commission (ICHC) Executive Director Bruce Johnston and
representatives of the Michigan State Housing Development Authority (MSHDA)
addressed the Council on programs to assist housing rehabilitation for Mason
homeowners as well as rental property in the downtown area. It is possible to apply at this time and
they are interested in applying for a grant specific to Mason. The city’s participation would be to provide
a letter of support to begin the application process and to establish policy
guidelines. ICHC would apply to the
county on behalf of the City of Mason as well as take the administrative
role. Discussion ensued on criteria.
Motion by
Helbig, supported by Howe,
To
authorize staff to work with the County to submit a grant application to MSHDA
for the rental rehabilitation program and home owner program.
VOTE: Yes (5)
Preadmore, Helbig, Clark, Howe, Whipple
No
(0)
MOTION
CARRIED
Discussion
- Michigan Liquor Control Commission Determination
As a
result to the correction in the 2000 Census count, there is a Class C Liquor License currently
available to the City of Mason. Due to
recent changes in the law, part of the application responsibility has been
placed on the city to go through the initial review. Part of the Council’s responsibility is to decide where the
application goes. The council indicated
support of the DDA’s pursuit of the private enterprise, Genex, to renovate the
old fire station on N. Jefferson into a restaurant. A letter of request has been submitted by Genex indicating the
proposed restaurant’s desire to obtain the available license.
UNFINISHED
BUSINESS
·
None
NEW
BUSINESS
·
None
COUNCIL
CORRESPONDENCE
·
None
LIAISON
REPORT
Planning
Commission
·
No report at this time.
Downtown
Development Authority
·
Mayor Whipple commented that the DDA is meeting this
Thursday at 5:30 p.m. The agenda
includes a buy/sell agreement for Genex.
Cable
Commission
·
No report at this time.
ADMINISTRATOR’S
REPORT
Administrator
Colburn commented that the city web site continues to be updated. New cement is being placed in front of City
Hall. Street work will begin tomorrow. The historical marker has been placed at the
cemetery. A Dangerous Building hearing
has been scheduled on the open basement located at 293 Okemos, September 9,
2002 at 5:30 p.m.
PEOPLE
FROM THE FLOOR
·
None
EXECUTIVE
SESSION
Motion by
Howe, supported by Preadmore,
To adjourn
into executive session to discuss privileged attorney client communications on
pending litigation befor Judge Collette in the Ingham County Circuit Court per
a roll call vote.
VOTE: Yes (5)
Preadmore, Helbig, Clark, Howe, Whipple
No
(0)
MOTION
CARRIED
The
meeting adjourned into executive session at 8:24 p.m.
ADJOURNMENT
Being
there was no further business the meeting adjourned at 8:58 p.m.
_________________________ ________________________
Martin A.
Colburn, City Clerk Russell
W. Whipple, Mayor