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HomeMy WebLinkAboutRESOLUTION NO. 2005-36 Fairfax/41991 5-8/2d M Iss 419915-8 (Issuance- ts,0.) FOR YOUR Fairfax, Iowa September 28,2005 The City Council of the City of Fairfax, Iowa, met on September 28, 2005, at 5:30 o"clock p,m., at the City Hall,Fairfax, Iowa. The meeting was called to order by the Mayor, and the roll was called showing the following Council Members present and absent: Present: Absent: After due consideratldrl and discussion, Council Member __�..O�_._J introduced resolution next hereinafter set out and moved its adoption, seconded by Council Member . The Mayor put the question upon the adoption of said resolution, and the roll being called, the following Council Members voted: Ayes: � � Nays: Whereupon,the Mayor declared the resolution duly adopted as hereinafter set out. At the conclusion of the meeting, and upon motion and vote,the Council adjourned. Mayor . Attest: City Clerk -t- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA FaarfaV419915-8/2"'%Z Iss RESOLUTION NO. � Resolution authorizing and approving a Loan Agreement and providing for the issuance of $650,000 General Obligation Sanitary Sewer Improvement Notes, Series 2005, and providing for the levy of taxes to pay the same WHEREAS, pursuant to the provisions of Section 384.24A of the Code of Iowa, notice duly published and hearing held thereon, the City of Fairfax, Iowa (the "City"), has heretofore determined to contract indebtedness and enter into a loan agreement (the "Loan Agreement") in the principal amount of$650,000 to provide funds to pay the cost, to that extent, of constructing improvements and extensions to the Municipal Sanitary Sewer System; and WHEREAS,pursuant to advertisement of sale,bids for the purchase of$650,000 General Obligation Sanitary Sewer Improvement Notes, Series 20051 (the "Notes"), to be issued in evidence of the City's obligation under the Loan Agreement were received and canvassed on behalf of the City and the Notes were sold and awarded to Bankers' Bank, Madison, Wisconsin (the `Purchaser"); NOW, THEREFORE,Be It Resolved by the City Council of the City of Fairfax, Iowa, as follows: Section 1. The City shall enter into the Loan Agreement with the Purchaser, in substantially the form as has been placed on file with the Council, providing for a loan to the. City in the principal amount of$650,000, at a discount of$3,2.50, for the purpose or purposes set forth in the preamble hereof. The Mayor and City Clerk are hereby authorized and directed to sign. the Loan Agreement on behalf of the City, and the Loan Agreement is hereby approved. Section 2. The Notes are hereby authorized to be issued to the Purchaser in evidence of the obligation of the City under the Loan Agreement, in the total aggregate principal amount of$650,000, to be dated October 1, 2005, in the denomination of$5,000 each, or any integral multiple thereof, maturing on June 1 in each of the years, in the respective principal amounts and bearing interest at the respective rates, as follows: Principal Interest Rate Principal Interest Rate Year Amount Per Annum Year - Amount Per Annum 2008 $70,000 3.10% 2012 $85,000 3.40% 2009 $75,000 3.15% 2013 $85,000 3.50% 2010 $75,000 3.20% 2014 $90,000 3.60% 2011 $80,000 3.30% 2015 $90,000 3.70% Bankers Trust Company, N.A., Des Moines, Iowa, is hereby designated as the Registrar and Paying Agent for the Notes and may be hereinafter referred to as the "Registrar" or the "Paying Agent". The City shall enter into an agreement (the "Registrar/Paying Agent Agreement") with the Registrar, in substantially the form as has been placed on file with the Council; the Mayor and City Clerk are hereby authorized and directed to sign the _2_ DORSEY&WUITNEY LLP,ATTORNEYS,DES MOINES,IOWA 1?'azrfaxP419915-812nd%s Jss Registrar/Paying Agent Agreement on behalf of the City; and the Registrar/Paying Agent Agreement is hereby approved. The City reserves the right to prepay part or all of the Notes maturing in each of the year's 2013 to 2015, inclusive, prior to and in any order of maturity on June 1, 2012, or on any date thereafter upon terms of par and accrued.interest. 1f less than all of the Notes of any like maturity are to be redeemed, the particular part of those Notesto be redeemed shall be selected by the Registrar by lot. The Notes may be called in part in one or more units of$5,000. If less than the entire principal amount of any Note in a denomination of more than $5,000 is to be redeemed, the Registrar will issue and deliver to the registered owner thereof, upon surrender of such original Note, a new Note or Notes, in any authorized denomination, in a total aggregate principal amount equal to the unredeemed balance of the original Note. Notice of such redemption as aforesaid identifying the Note or Notes (or portion thereof) to be redeemed shall be mailed by certified mail to the registered owners thereof at the addresses shown on the City's registration books not less than 30 nor more than 60 days prior'to such redemption date. All of such Notes as to which the City reserves and exercises the right of redemption and as to which notice as aforesaid shall have been given and for the redemption of which funds are dully provided, shall cease to bear interest on the redemption date. All of the interest on the Notes shall be payable semiannually on the first day of June and December in each year, commencing December 1, 2005. Interest shall be calculated on the basis of a 360-day year comprised of twelve 30-day months. Payment of interest on the Notes shall be made to the registered owners appearing on the registration books of the City at the close of business on the fifteenth day of the month next preceding the interest payment date and shall be paid by check or draft mailed to the registered owners at the addresses shown on such registration books. Principal of the Notes shall be payable in lawful money of the United States of America to the registered owners or their legal representatives upon presentation and surrender of the Note or Notes at the office of the Paying Agent. The Notes shall be executed on behalf of the City with the official manual or facsimile signature of the Mayor and attested with the official manual or facsimile signature of the City Clerk and shall have the City's seal impressed or printed thereon, and shall be fully registered Notes without interest coupons. In case any officer whose signature or the facsimile of whose signature appears on the Notes shall cease to be such officer before the delivery of the Notes, such signature or such facsimile signature shall nevertheless be valid and sufficient for .all purposes, the game as if such officer had remained in office until delivery. The Notes shall not be valid or become obligatory for any purpose until the Certificate of Authentication thereon shall have been signed by the Registrar.. The Notes shall be fully registered as to principal and interest in the names of the owners on the registration books of the City kept by the Registrar, and after such registration,payment of the principal thereof and interest thereon shall be made only to the registered owners or their legal representatives or assigns. Each Note shall be transferable only upon the registration books of the City upon presentation to the Registrar, together with either a written instrument of transfer satisfactory to the Registrar or the assignment form thereon completed and dully executed by the registered owner or the duly authorized attorney for such registered owner. -3- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA EmlrfaX/4I99i5-S/2°d',/iss The record and identity of the owners of the Notes shall be kept confidential as provided by Section 22.7 of the Code of Iowa. Section 3. Notwithstanding anything above to the contrary, the Notes shall be issued initially as Depository Bonds, with one fully registered Note for each maturity date, in principal amounts equal to the amount of principal maturing on each such date, and registered in the name of Cede& Co., as nominee for The Depository Trust Company,New York,New York {"DTC"). On original issue, the Notes shall be deposited with DTC for the purpose of maintaining a book- entry system for recording the ownership interests of its participants and the transfer of those interests among its participants (the "Participants"). In the event that DTC determines not to continue to act as securities depository for the Notes or the City determines not to continue the book-entry system for recording ownership interests in the Notes with DTC, the City will discontinue the book-entry system with DTC. If the City does not select another qualified securities depository to replace DTC (or a successor depository) in order to continue a book- entry oo -entry system, the City will register and deliver replacement Notes in the form of fully registered certificates, in authorized denominations of$5,000 or integral multiples of$5,000, in accordance with instructions from Cede & Co., as nominee for DTC. In the event that the City identifies a qualified securities depository to replace DTC, the City will register and deliver replacement Notes, fully registered in the name of such depository, or its nominee, in the denominations as set forth above, as reduced from time to time prior to maturity in connection with redemptions or retirements by call or payment, and in such event, such depository will then maintain the book- entry system for recording ownership interests in the Notes. Ownership interest in the Notes may be purchased by or through Participants. Such Participants and the persons for whom they acquire interests in the Notes as nominees will not receive certificated Notes,but each such Participant will receive a credit balance in the records of DTC in the amount of such P'articipant's interest in the Notes, which will be confirmed in accordance with DTC's standard procedures. Each such person for which a Participant has an interest in the Notes, as nominee,may desire to make arrangements with such Participant to have all notices of redemption or other communications of the City to DTC, which may affect such person, forwarded in writing by such Participant and to have notification made of all interest payments. The City will have no responsibility or obligation to such Participants or the persons for wham they act as nominees with respect to payment to or providing of notice for such Participants or the persons for whom they act as nominees. As used herein, the term "Beneficial Owner" shall hereinafter be deemed to include the person for whom the Participant acquires an interest in the Notes. DTC will receive payments from the City, to be remitted by DTC to the Participants for subsequent disbursement to the Beneficial Owners. The ownership interest of each Beneficial Owner in the Notes will be recorded on the records of the Participants whose ownership interest will be recorded on a computerized book-entry system kept by DTC. When reference is made to any action which is required or permitted to be taken by the Beneficial Owners, such reference shall only relate to those permitted to act (by statute, -4- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Eamrfax/419915-8/Td'/z iss regulation or otherwise) on behalf of such Beneficial Owners for such purposes. When notices are given, they shall be sent by the City to DTC, and DTC shall forward (or cause to be forwarded) the notices to the Participants so that the Participants can forward the same to the Beneficial Owners. Beneficial Owners will receive written confirmations of their purchases from the Participants acting on behalf of the Beneficial Owners detailing the terms of the Notes acquired. Transfers of ownership interests in the Notes will be accomplished by book entries made by D'TC and the Participants who act on behalf of the Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interest in the Notes, except as specifically provided herein. Interest and principal will be paid when due by the City to DTC, then paid.by DTC to the Participants and thereafter paid by the Participants to the Beneficial Owners. Section 4. The Notes shall be in substantially the fallowing form: -S- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA EairfaV419915-812"''/�Iss (Form of Note) UNITED STATES OF AMERICA STATE OF IOWA COUNTY OF LINN CITY OF FAIRFAX GENERAL OBLIGATION SANITARY SEWER IMPROVEMENT NOTE, SERIES 2005 No. $ RATE MATURITY DATE NOTE DATE CUSIP October 1, :2005 The City of Fairfax (the "City"), in the County of Linn, 'State of Iowa, for value received, promises to pay on the maturity.date of this Note to or registered assigns, the principal sum of DOLLARS in lawful money of the United States of America upon presentation and surrender of this Note at the office of Bankers Trust Company, N.A., Des Moines, Iowa (hereinafter referred to as the "Registrar" or the "Paying Agent ), with interest on said sum,, until paid, at the rate per annum specified above from the date of this Note, or from the most recent interest payment date on which interest has been paid, on dune 1 and December 1 of each year, commencing December, 1, 2005, except as the provisions hereinafter set forth with respect to redemption prior to maturity may be or become applicable hereto. Interest on this Note is payable to the registered owner appearing on the registration books of the City at the close of business on the fifteenth day of the month next preceding the interest payment date, and shall be paid by check or draft mailed to the registered owner at the address shown on such registration books. Interest shall be calculated on the basis of a 360-day year comprised of twelve.30-day months. This Note shall not be valid or become obligatory for any purpose until the Certificate of Authentication hereon shall have been signed by the Registrar, This Note is one of a series of General Obligation Sanitary Sewer Improvement Notes, Series 2005 (the "Notes"), issued in the aggregate principal amount of$650,000 by the City to evidence its obligation under a certain loan agreement, dated as of October 1, 2005 (the "Loan Agreement"), entered into by the City for the purpose of providing funds to pay costs of constructing improvements and extensions to the Municipal Sanitary Sewer System. -6- DORSE'Y&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Fairfax/419915-8/2"4 IK Iss The Notes are issued pursuant to and in strict compliance with the provisions of Chapters 384 and 76 of the Code of Iowa, 2005, and all other laws amendatory thereof and supplemental thereto, and in conformity with a resolution of the City Council authorizing and approving the Loan Agreement and providing for the issuance and securing the payment of the Notes (the "Resolution"), and reference is hereby made to the Resolution and the Loan Agreement for a more complete statement as to the source of payment of the Notes and the rights of the owners of the Notes, The City reserves the right to prepay part or all of the Notes maturing in each of the years 2013 to 2015, inclusive, prior to and in any order of maturity on June 1, 2012, or on any date thereafter upon terms of par and accrued interest. If less than all of the Notes of any like maturity are to be redeemed, the particular part of those Notes to be redeemed shall be selected by the Registrar by lot. The Nimes may be called in part in one or more units of$5,000. If less than the entire principal amount of any Note in a denomination of more than $5,000 is to be redeemed, the Registrar will issue and deliver to the registered owner thereof, upon surrender of such original Note, a new Note or Notes, in any authorized denomination, in a total aggregate principal amount equal to the unredeemed balance of the original Note. Notice of such redemption as aforesaid identifying the Note or Notes (or portion thereof) to be redeemed shall be mailed by certified snail to the registered owners thereof at the addresses shown on the City"s registration books not less than 30 nor more than 60 days prior to such redemption date. All of such Notes as to which the City reserves and exercises the right of redemption and as to which notice as aforesaid shall have been given and for the redemption of which funds are drily provided, shall cease to bear interest on the redemption date. This Note is fully negotiable but shall be fully registered as to both principal and interest in the name of the owner on the books of the City in the office of the Registrar, after which no transfer shall be valid unless made on said books and then only upon presentation of this Note to the Registrar, together with either a written instrument of transfer satisfactory to the Registrar or the assignment form hereon completed and duly executed by the registered owner or the duly authorized attorney for such registered owner. The City, the Registrar and the Paying Agent may deem and treat the registered owner hereof as the absolute owner for the purpose of receiving payment of or on account of principal hereof, premium, if any, and interest due hereon and for all other purposes, and the City, the Registrar and the Paying Agent shall not be affected by any notice to the contrary. And It Is Hereby Certified and Recited that all acts, conditions and things required by the laws and Constitution of the State of Iowa, to exist, to be had, to be done or to be performed precedent to and in the issue of this Note were and have been properly existent, had, done and perfon-ned in regular and due form and time; that provision has been made for the levy of a sufficient continuing annual tax on all the taxable property within the City for the payment of the principal of and interest on this Note as the same will respectively become due; that the faith, credit, revenues and resources and all the real and personal'property of the City are irrevocably pledged for the prompt payment hereof, both principal and interest; and that the total indebtedness of the City, including this Note, does not exceed any constitutional or statutory limitations. -7- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA FairfW419915-812°d'/z Iss IN TESTIMONY WHEREOF, the City of Fairfax, Iowa,by its City Council, has caused this Note to be sealed with the facsimile of its official seal, to be executed with the duly authorized facsimile signature of its Mayor and attested with the duly authorized facsimile signature of its City Clerk, all as of October 1, 2005. CITY OF FAIRFAX, IOWA By(DO NOT SIGN Mayor Attest, (DO NOT SIGN} City Clerk (Facsimile Seal) Registration Date: (Registration Date) REGISTRAR''S CERTIFICATE OF AUTHENTICATION This Note is one of the Notes described in the within-mentioned Resolution. BANKERS 'TRUST COMPANY,N.A. Des Moines,Iowa Registrar By_ Aruthorized Signatures _ Authorized Officer -8- DORSEY WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA I Fairfax/419915-8/2nd Yi Iss ABBREVIATIONS The following abbreviations, when used in this Note, shall be construed as though they were written out in hili according to applicable laws or regulations: TEN COM - as tenants in common UTMA "SEN ENT - as tenants by the entireties (Custodian) ,JT TEN - as joint tenants with right of As Custodian for survivorship and not as (Minor) tenants in common under Uniform.Transfers to Minors Act (State) Additional abbreviations may also be used though not in the list above. ASSIGNMENT For valuable consideration, receipt of which is hereby acknowledged, the undersigned assigns this Note to (Please print or type name and address of Assignee) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE and does hereby irrevocably appoint ,Attorney,to transfer this Note on the books kept for registration thereof with full power of substitution. Dated: Signature guaranteed: (Signature guarantee must be provided in accordance with the prevailing standards and procedures of the Registrar and Transfer Agent. Such standards and procedures may require signatures to be guaranteed by certain eligible guarantor institutions that participate in a recognized signature guarantee prograrn.) NOTICE: The signature to this Assignment must correspond with the name of the registered owner as it appears on this Note in every particular, without alteration or enlargement or any change whatever'. -9- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Fairfax/419915-8/2d%Iss Section 5. The Notes shall be executed as herein provided as soon after the adoption of this resolution as may be possible, and thereupon they shall be delivered to the Registrar for registration, authentication and delivery to the Purchaser, upon receipt of the loan proceeds, and all action heretofore,taken in connection with the Loan Agreement is hereby ratified and confirmed in all respects. Section 6. For the purpose of providing for the levy and collection of a direct annual tax sufficient to pay the principal of and interest on the Notes as the same become due, there is hereby ordered levied on all the taxable property in the City in each of the years while the Nates are outstanding, a tax sufficient for that purpose, and in furtherance of this provision, but not in limitation thereof, there is hereby levied on all the taxable property in the City the following direct annual tax for collection in each of the following fiscal years,to-wit: For collection in the fiscal year beginning July 1, 2006, sufficient to produce the net annual sum of$22,008; For collection in the fiscal year beginning July 1, 2007, sufficient to produce the net annual sum of$92,008; For collection in the fiscal year beginning July 1, 2008, sufficient to produce the net annual sum of$94,838; For collection in the fiscal year beginning July 1, 2009, sufficient to produce the net annual sum of$92,475, For collection in the fiscal year beginning July 1, 2010, sufficient to produce the net annual sum of$95,075; For collection in the fiscal year beginning July 1, 2011, sufficient to produce the net annual sum of$97,43.5; For collection in the fiscal year beginning July 1, 2012, sufficient to produce the net annual sum of$94,545; For collection in the fiscal year beginning July 1, 2013, sufficient to produce the net annual sum of$96,570; For collection in the fiscal year beginning July 1, 2014, sufficient to produce the net annual sum of$93,330; Section 7. A certified copy of this resolution shall be filed with the County Auditor of Linn County, and said Auditor is hereby instructed to enter for collection and assess the tax hereby authorized. When annually entering such taxes for collection, the County Auditor shall include the same as a part of the tax levy for Debt Service Fund purposes of the City and when collected, the proceeds of the taxes shall be converted into the Debt Service Fund of the City and set aside therein as a special account to be used solely and only for the payment of the principal of and interest on the Notes hereby authorized and for no other purpose whatsoever. Any -10- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Fairfax/419915-8/2d Y2 ISS amount received by the City as accrued interest on the Notes shall be deposited into such special account and used to pay interest due on the Notes on the first interest payment date. Section$. The interest or principal and both of them falling due in any year or years shall, if necessary, be paid promptly from current funds on hand in advance of taxes levied and when the taxes shall have been collected, reimbursement shall be made to such current funds in the sum thus advanced. The City hereby pledges the faith, credit, revenues and resources and all of the real and personal property of the City for the full and prompt payment of the principal of and interest on the Notes. Section 9. It is the intention of the City that interest on the Notes be and remain excluded from gross income for federal income tax purposes pursuant to the appropriate provisions of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations in effect with respect thereto (alt of the foregoing herein referred to as the "Internal Revenue Code"). In furtherance thereof, the City covenants to comply with the provisions of the Internal Revenue Code as they may from time to time be in effect or amended and further covenants to comply with the applicable future laws,regulations,published rulings and court decisions as may be necessary to insure that the interest on the Notes will remain excluded from gross income for federal income tax purposes. any and all of the officers of the City are hereby authorized and directed to take any and all actions as may be necessary to comply with the covenants herein contained. The City hereby designates the Notes as "Qualified Tax.Exempt Obligations"as that term is used in Section 265(b)(3)(B)ofthe Internal Revenue Code. Section 10. Continuing Disclosure. The Securities and Exchange Commission (the "SEC")has promulgated certain amendments to Rule 15c2-12 under the Securities Exchange pct of 1934 (17 C.F.R. § 240.15c2-12) (the "Rule") that make it unlawful for an underwriter to participate in the primary offering of municipal securities in a principal amount of$1,000,000 or more unless, before submitting, a bid or entering into a purchase contract for the bonds, it has reasonably determined that the issuer or an obligated person has undertaken in writing for the benefit of the bondholders to provide certain disclosure information to prescribed information repositories on a continuing basis or unless and to the extent the offering is exempt from the requirements of the Rule. The principal amount of the Notes is less than $1,000,000. The City hereby represents that it has not issued within the six months before the date of issuance of the Notes, and that it reasonably expects that it will not issue within six months after the date of issuance of the Nates, other securities of the City of substantially the same security and providing financing for the same general purpose or purposes as the Notes. Consequently, this Council hereby finds that the Rule is inapplicable to the Notes, because the aggregate principal amount of the Notes and any other securities required to be integrated with the Notes under the Rule is less than$1,000,000. -11- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA F'aIdW419915-812°a%Iss Section 11. All resolutions or parts thereof in conflict herewith are hereby repealed to the extent of such conflict. Passed and approved September 28, 2005. Mayor Attest~ City Clerk -12- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Falrfax/419915-8/2°d%x 1ss STATE OF IOWA COUNTY OF LINK SS: CITY OF FAIRFAX I, the undersigned, City Clerk of the aforementioned City, do hereby certify that as such City Clerk I have in my possession or have access to the complete corporate records of the City and of its Council and officers and that I have carefully compared the transcript hereto attached with the aforesaid corporate records and that the transcript hereto attached is a true, correct and complete copy of all the corporate records in relation to the adoption of a resolution authorizing and approving a certain Loan Agreement and providing for the issuance of $650,000 General Obligation Sanitary Sewer Improvement Notes of said City evidencing the City's obligation under the Loan Agreement and that the transcript hereto attached contains a.true, correct and complete statement of all the measures adopted and proceedings, acts and things had, done and performed up to the present time with respect thereto. I further certify that no appeal has been taken to the District Court from the decision of the City Council to enter into the Loan Agreement, to issue the Notes or to levy taxes to pay the principal of and interest on the Nantes. WI SS MY HAND and the seal of the City hereto affixed this day of rOA 2005. City Clerk -t3- DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA F1rI'ax1419915-812°a'/x Jss STATE OF IOWA SS: COUNTY OF LINN I, the undersigned, Count Auditor ofpaforementioned County, in the State of Iowa, do hereby certify that on the day of �®� � ,2005, the City Clerk of the City of Fairfax filed in my office a certified copy of a resolution of such City shown to have been adopted by the Council and approved by the Mayor thereof on September 28, 2005, entitled: "Resolution authorizing and approving a Loan Agreement and providing for the issuance of $650,000 General Obligation Sanitary Sewer Improvement Notes, Series 2005, and providing for the levy of taxes to pay the same," and that I have duly placed the copy of the resolution on file in any records. I further certify that the taxes provided for in that resolution will in due time, manner and season be entered on the State and County tax lists of this County for collection in the fiscal year beginning July 1, 2006, and subsequent years as provided in the resolution. WITNESS MY HAND and the seal of the County hereto affixed this day of 2005. Co ty Auditor Seal) -14- DOR.SEY&WEITNEY LLP,ATTORNEYS,DES MOINES,IOWA LOAN AGREEMENT This Loan Agreement is entered into as of October 1, 2005, by and between the City of Fairfax, Iowa (the "City"'),and Bankers' Bank,Madison,Wisconsin(the"Purchaser"). The parties agree as follows: 1. The Purchaser shall loan to the City the sum of $650,000, at a discount of$3,250, and the City's obligation to repay hereunder shall be evidenced by the issuance of General Obligation Sanitary Sewer Improvement Notes, 'Series 2005, in the aggregate principal amount of$650,000 (the"Notes"). 2. The City has adopted a resolution(the"Resolution")authorizing and approving this Loan Agreement and providing for the issuance of the Notes and the levy of taxes to pay the principal of and interest on the Notes for the purpose or purposes set forth in the: Resolution. The Resolution is incorporated herein by reference„ and the parties agree to abide by the terms and provisions of the Resolution. In and by the Resolution, provision has been made for the levy of a sufficient continuing annual tax on all the taxable property within the City for the payment of the principal of and interest on the Notes as the same will respectively become due, and the City has irrevocably pledged the faith, credit, revenues and resources and all the real and personal property of the City for the full and prompt,payment of the principal of and interest on the Notes. 3. Any amount received by the City as accrued interest on the Notes shall be deposited in the special account within the City's Debt Service Fund established pursuant to the Resolution and shall be held therein and used, along with other amounts on deposit in such account, to pay interest on the Notes due on the first interest payment date. 4. The Notes, in substantially the form set forth in the Resolution,shall be executed and delivered to the Purchaser to evidence the City's obligation to repay the amounts payable hereunder. The Notes shall be dated October 1, 2005, shall be in denominations of $5,000 or integral multiples thereof, shall bear interest, shall be payable as to principal on the dates and in the amounts, shall be subject to prepayment prior to maturity and shall contain such other terms and provisions as provided in the Notes and the Resolution. 5, This Loan Agreement is executed pursuant to the provisions of Section 384.24A of the Code of Iowa and shall be read and construed as conforming to all provisions and requirements of the statute. IN WITNESS WHEREOF,we have hereunto affixed our signatures all as of the date first above written. CITY OF FAA , IOWA By Mayor Attest:. City Cleric (Seal) BANKERS' BANK Madison,Wisconsin By (Signature) (Print Name and Title) RairfaXJ4 t 9915-8/Reg/PA-Bankers I PAYING AGENT AND REGISTRAII.AND TRANSFER AGENT AGREEMENT This Agreement is entered into the date hereof between BANKERS TRUST COMPANY, N.A., Des Moines, Iowa (the "Agent") and the CITY OF FAIRFAX, IOWA (tile "Issuer"). 1. Definition of Terms—The terms "item," ``receipt," "transfer," "turnaround," "process," "business day," and other terms used throughout this Agreement shall be deemed to have the meanings provided in the regulations promulgated pursuant to the Securities Exchange Act of 1934 and the Code of Iowa as amended and in effect from time to time. 2. Issuance Resolution Incorporated By Reference—The Agent agrees to act on behalf of the Issuer pursuant to the terms of this Agreement and pursuant to the Issuer's resolution (the "Resolution") authorizing and providing for the issuance of $650,000 General Obligation Sanitary Sewer Improvement Notes, Series 2005, dated October 1, 2005 (the `Notes"). The Resolution and the terms thereof are hereby incorporated by reference and the provisions of this Agreement are to be construed to be consistent with the Resolution. In the event of inconsistent language between the Resolution and this Agreement, the terms of the Resolution shall prevail. 3. Registrar Function--The Agent shall maintain records of the identity of the owners of the Notes in order to carry out its function as Registrar and upon request of the Issuer shall from time to time deliver to the Issuer records, documents and other writings made or accumulated in the performance of its duties as Registrar. In such capacity the Agent is authorized at any time to register for original issue certificates representing the Notes and not _ exceeding the total principal amount of the Notes ("certificates") and upon surrender for cancellation of certificates to register new certificates for the principal amount of Notes represented by the certificates so cancelled and to redeliver such new certificates. 4. Transfer Agent Function/Charges—For the purpose of the original issue of certificates the Agent is hereby directed to record and authenticate certificates signed by or bearing the facsimile signatures of the officers of the Issuer authorized to sign certificates in such names and in such amounts as the Issuer may direct. The Agent shall make transfers from time to time upon the records of the Issuer of any outstanding certificates and of certificates issued in exchange therefor signed by the officers of the Issuer upon surrender thereof for transfer properly endorsed and upon reasonable assurance that such endorsements are genuine and effective in accordance with Section 554.8401, Code of Iowa. Signature guarantee must be provided in accordance with the prevailing standards and procedures of the Registrar and Transfer Agent. Such standards and procedures may require DORSEY&WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA 1;'a dfaV419915-5/Re&A-Bankers . signatures to be guaranteed by certain eligible guarantor institutions that participate in a recognized signature guarantee program. The Issuer and the Agent may also require payment by the person requesting an exchange or transfer of the certificates of a service charge and a sum sufficient to cover any tax, fee or other governmental charge that may be imposed in relation thereto, except in the case of the issuance of a certificate for the unredeemed portion of a certificate surrendered for redemption... Upon request for cancellation of such certificates the Agent shall record and authenticate new certificates duly signed and deliver such certificates to or upon the order of the person entitled thereto. Certified specimen signatures of the officers of the Issuer and certified specimen certificates in the form duly approved by the Issuer shall be lodged with the Agent and upon request of the Agent the Issuer will deliver to the Agent a sufficient supply of certificates in the form approved. 5. Paying Agent Function—The Agent is hereby authorized and shall make payments of principal and interest to the registered owners of the Notes as follows: (a) At least one business day prior to each payment date the Issuer will deposit with the Agent in 'immediately available funds such amount as is required to make such payment. (b) One business day before each payment date the Agent will pay interest and, upon presentation and surrender of the matured or called Note, will pay principal to each registered owner of the Notes as of the record date by mailing a check to each such owner. In any case where the date of maturity of interest on or principal of the Note or the date fixed for redemption of any Note shall be a Sunday or a legal holiday or a day on which banking institutions are authorized by law to close, then payment of interest or principal may be made on the succeeding business day with the same force and effect as if made on the date of maturity or the day fixed for redemption. Provided, however, that payment of principal shall be made not later than the second day after receipt of the matured Note. (c) When the Agent shall receive notice from the Issuer of its option to redeem Notes prior to maturity, the Agent shall select the Notes to be redeemed and give notice of the redemption thereof, all in accordance with the terms of the Notes and the Resolution. 6. Form of Records--The records of the Agent shall be in such form as to be in compliance with standards issued from time to time by the Municipal Securities Rule Making Board of the United States and any other securities industries standard and the requirements of the Internal Revenue Code of 19'86 and Chapter 76 of the Code of Iowa. -2- DORSEY&,WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Fal rl`ax/419915-8IReg1PA-Bankers 7. Confidentiality of Records—The Agent's records in connection with the Notes shall remain confidential records entitled to protection and confidentiality pursuant to Section 22.7, Code of Iowa. The Agent agrees that its use of the records will be limited to the purposes of this Agreement and that the Agent will make no private use or permit any private access thereto. 8. Reliance Upon Certain Certifications and Representations—The Agent may rely conclusively and act, without further investigation, upon .any list, instruction, certification, authorization, certificate, or other instrument or paper suitably guaranteed and believed by it in good faith and due diligence in performing its functions to be genuine and to have been signed, countersigned, or executed by a duly authorized person or persons or upon the instruction of any authorized officer of the Issuer or upon the advice of the Issuer's counsel; and may register.any certificate representing the Nates or may refuse to register any such certificate if in good faith the .Agent deems such refusal necessary in order to avoid any liability on the part of either the Issuer or the Agent, and the Issuer agrees to indemnify and hold harmless the Agent from and against any and all losses, costs, claims, and liability for so relying or acting or refusing to act. 9. Rules and Regulations Governing Registration-The Agent shall comply at all times with such rules, regulations and requirements as may govern the registration, transfer .and payment of registered Notes including without limitation Chapter 76 and Sections 554.8101 et seq., Code of Iowa, and standards issued from time to time by the Municipal Securities Rule Making Board of the United States and any other securities industries standard and the requirements of the Internal Revenue Code of 1986. 10. Signature of Officers—In case any of the officers of the Issuer whose manual or facsimile signature appears on any certificate, Note or other record delivered to the Agent shall cease to be such officer prior to the registration, processing, or transfer thereof, the Agent may nevertheless process such documents as though the person signing the same or whose facsimile signature appears thereon had not ceased to be such officer unless written instruction of the Issuer to the contrary is received. 11. Record Date—For purposes of determining the registered owners of the Notes the record date shall be deemed to be the fifteenth day of the month preceding the date on which payment of principal, premium, if any, or interest is payable to the registered owners of the Notes ("Payment Date") whether such payment is due to optional redemption, operation of a sinking fund, or for any other reason. 12. Three Days Turnaround—The Agent agrees that it will turnaround within three business days of receipt all items received in proper form for transfer, process or other action pursuant to the terms of this Agreement. 13. Destruction of Cancelled Notes—The Agent will promptly cancel and destroy all Notes or certificates representing the Notes which have been spoiled, surrendered to it for transfer, or with respect to which principal, premium, if any, and interest owing on such Notes -3- DORSEY&AWTNEY LLP,ATTORNEYS,DES MOINES,IOWA ]Faird'ax1419915-VReOA-Bankers has been paid, and will provide the Issuer with a Certificate of Destruction certifying as to the destruction of such cancelled Notes. 14. Payment of Unclaimed Amounts—In the event any payment check representing payment of interest or principal on the Notes is returned to the Agent or is not presented for payment or if any Note is not presented for payment of principal or premium at the maturity or redemption date, if funds sufficient to pay such interest or principal shall have been made available to the Agent for the benefit of the owner thereof, all liability of the Issuer to the owner thereof for such interest or principal payment of such Notes shall forthwith cease, terminate and be completely discharged, and thereupon it shall be the duty of the Agent to hold such funds, without liability for interest thereon, for the benefit of the owner of such Notes who shall thereafter be restricted exclusively to such funds for any claim of whatever nature on its part under the Resolution or on, or with respect to, such interest or principal. The Agent's obligation to hold such funds shall continue for a period equal to six months following the date on which such interest or principal became due, whether at maturity, or at the date fixed for redemption thereof, or otherwise, at which time the Agent shall surrender any remaining funds so held to the Issuer, whereupon any claim under the Resolution by the owners of Notes of whatever nature shall be made upon the Issuer. 15. No Obligation to Invest—The Agent will have no obligation to invest any funds in its possession. 16. Compensation of the Agent—The Issuer will pay the Agent reasonable compensation for its services based upon the schedule of fees attached or such other schedule of fees as may be agreed upon from time to time between the Agent and the.Issuer. The Agent's compensation may include the amount of any attorney fees incurred by it under Section 17 hereof. 17. Bond Counsel-When the Agent deems it necessary or reasonable it may apply to Bond Counsel for the Issuer or such other law firm or attorney approved by the Issuer for instructions or advice, 18. Termination of .agreement—This Agreement may be terminated by either party by giving the other party at Least 90 days advance written notice. At termination of the Agreement, the Agent shall deliver to the Issuer any and all records, documents or other writings made or accumulated in the performance of its duties under this Agreement and shall refund the unearned balance, if any, of fees paid in advance by the Issuer. 19. Examination of Records—The Issuer or its duly authorized agents may examine all records relating to the Notes at the principal office of the Agent at reasonable times as agreed upon with the Agent and such records shall be subject to audit from time to time at the request of the Issuer or the Agent. The Agent, on request, will furnish the Issuer with a list of the names, addresses, and other information concerning the owners of the Nates or any of them. -4- DORSEY C,WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA FairfhV41991 S-8/Re&A-Bankers 20. Obligations, Rights and Privileges of the Agent--The Agent shall have, with regard to the particular funetions it performs, the same obligation to the owner or owners of the Notes and shall have the same rights and privileges the Issuer has in regard to those functions.. Dated as of October 1, 2005. CITY OF FAIRFAX,IOWA By Mayor Attest: 17 City Clerk (Seal) BANKERS TRUST COMPANY,N.A. AGENT By Trust OC fhcer (Seal) DORSE r' WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA BANKERS TRUST COMPANY PAYING AGENT, BOND REGISTRAR AND TRANSFER AGENT FEE SCHEDULE (BOOK ENTRY) INITIAL FEE 100.00 (Minimum initial fee) ANNUAL FEES X400.00 (Minimum annual fee) Effective July 1, 2004 ADDITIONAL SERVICES Reasonable charges will be made for additional services or reports not contemplated at the time of execution of the Agreement or not covered specifically elsewhere in this schedule, such as preparation of bondholder lists or government reports or termination of our services prior to the issue's final maturity. Charges will be based on our analysis of the cost of providing the additional services. OUT-OF-POCKET EXPENSES Extraordinary out-of-pocket expenses will be charged at cost. However, this does not include ordinary out-of-pocket expenses such as normal postage and supplies, which are included in the annual fees quoted above. CHANGES IN FEE SCHEDLTLE Bankers Trust reserves the right to renegotiate this fee schedule. BANKERS TRUST Trust Division (515) 245-5269 (800) 362-1688 in Iowa (07-04)