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Water Revenue Capital Loan Notes (SRF) $4.4M Roosevelt Water Tower Series 2019 Proceedings to Complete Action Copyrighted July 15, 2019 City of Dubuque Consent Items # 15. ITEM TITLE: Proceedings to Complete Action on $4,400,000 Water Revenue Capital Loan Notes Series 2019 (State Revolving Fund Loan) SUMMARY: City Manager recommending approval of the suggested proceedings to complete action required on the $4,400,000 Water Revenue Capital Loan Notes Series 2019, and approving the Loan and Disbursement Agreement for the Roosevelt Water Tower and Eagle Point Park Treatment Plant and Water Distribution Improvements. RESOLUTION Series ResolutionAuthorizing and providing for the issuance and securing the payment of $4,400,000 Water Revenue Capital Loan Notes, Series 2019 bythe Cityof Dubuque, lowa underthe provisions of Chapter 384 of the Code of lowa, providing for a method of payment thereof, approving Loan and Disbursement Agreement, and other related matters SUGGESTED DISPOSITION: Suggested Disposition: Receiveand File;Adopt Resolution(s) ATTACHMENTS: Description Type MVM Memo City Manager Memo Staff Memo Staff Memo Authorizing Resolution Resolutions Loan and DisbursementAgreement Resolutions Tax E�mption Certificate Resolutions Bond Counsel Letter City Manager Memo Dubuque THE CITY OF � All•America City UB E ��o�����,.�,�� � � ��► Maste iece on the Mississi i 2°°'*2°12�z°13 �`P pp zoi�*zoi9 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Proceedings to Complete Action on Issuance of $4,400,000 Water Revenue Capital Loan Notes (State Revolving Fund Loan), Series 2019, Roosevelt Water Tower and Eagle Point Park Treatment Plant and Water Distribution Improvements DATE: July 8, 2019 Director of Finance and Budget Jennifer Larson is recommending City Council approval of the suggested proceedings to complete action required on the $4,400,000 Water Revenue Capital Loan Notes prepared by Bond Counsel and to present a resolution for City Council to adopt entitled "Resolution Authorizing and Providing for the Issuance and Securing the Payment of $4,400,000 Water Revenue Capital Loan Notes, Series 2019 by the City of Dubuque, lowa Under the Provisions of Chapter 384 of the Code of lowa, Proving for a Method of Payment Thereof, Approving Loan and Disbursement Agreement, and Other Related Matters." The total estimated State Revolving Fund Loan for the $5,272,672 Roosevelt Water Tower Project is $4,400,000. The State Revolving Capital Loan Notes will carry an annual 1.75% interest rate for 20 years, with an annual servicing fee of 0.25%. There is also a onetime 0.5% upfront loan origination fee. On March 25, 2019, The City Council awarded two construction contracts for the Water Distribution System Pressure Zone 2 Improvements: Roosevelt Street 1.25 MG Elevated Water Tower Project. Contract A was awarded to CB&I, LLC in the amount of $2,928,600. Contract A includes the Roosevelt Street Water Tower and Water Distribution Improvements. Contract B was awarded to Portzen Construction in the amount of$986,620. Contract B includes the Eagle Point Park Treatment Plant and Water Distribution Improvements. The extent of the work consists of the construction of four pressure control stations. I concur with the recommendation and respectfully request Mayor and City Council approval. . �► Michael C. Van Milligen MCVM/jml Attachment cc: Crenna Brumwell, City Attorney Cori Burbach, Assistant City Manager Teri Goodmann, Assistant City Manager Jennifer Larson, Finance and Budget Director Denise Blakeley-Ihrig, Water Department Manager 2 Dubuque THE CITY OF � All•America City UB E ��o�����,.�,�� � � ��► Maste iece on the Mississi i 2°°'*2°12�z°13 �`P pp zoi�*zoi9 TO: Michael C. Van Milligen, City Manger FROM: Jennifer Larson, Director of Finance and Budget SUBJECT: Proceedings to Complete Action on Issuance of$4,400,000 Water Revenue Capital Loan Notes (State Revolving Fund Loan), Series 2019, Roosevelt Water Tower and Eagle Point Park Treatment Plant and Water Distribution Improvements DATE: July 8, 2019 INTRODUCTION: The purpose of this memorandum is to summarize suggested proceedings to complete action required on the $4,400,000 Water Revenue Capital Loan Note (State Revolving Fund Loan). The proceeds of which will be used to fund the construction of the Roosevelt Water Tower project. A letter from attorney Kristin Cooper detailing information on the loan is enclosed. DISCUSSION In August 2017, the City issued a $475,000 SRF Planning and Design Loan for the Roosevelt Water Tower project. The planning and design loan had a 0% interest rate and no initiation or servicing fees. The $475,000 will be rolled into the SRF Construction Loan and is included in the issuance of not to exceed $4,400,000 Water Revenue Capital Loan Notes State Revolving Funds. The design was completed by IIW and in June 2018, a preliminary engineering report (PER) was submitted to the lowa DNR for review and approval of a 1.25MG elevated storage tower, pressure reducing stations, water main improvements, and water treatment plant pump improvements. On January 17, 2019 the lowa DNR issued approval of the PER submitted in June 2018. The notice approved lowa SRF funding in support of a 1.OMG elevated storage tower and not the recommended 1.25MG elevated storage tower. However, in reviewing the original PER there are clear benefits to the tower being sized at 1.25MG. The distribution system analysis focused on site selection, tower sizing, overflow elevation, and fire suppression needs. The Roosevelt Street location in Zone 2 was selected due its proximity to two 12-inch diameter mains, land and site access availability, the overall site elevation, and its proximity to drainage facilities in the event of an overflow and drainage associated with tank maintenance. Sizing of the tower has varied between 750,000 gallons and 1 .25 million gallons. Sizing the tower at 1 .25 million gallons would replace the functionally obsolete 0.5 million-gallon Eagle Point Park Elevated Tower and the Stafford Street booster pump station and provide maximum fire flows and normal usage during a major fire and accommodation of service area expansion. In addition, Zone 2 could be connected to Olympic Heights subdivision (Zone 5) and the Olympic Heights booster pump station could be taken out of service reducing energy, operation and maintenance costs and a pressure zone. The Olympic Heights pump station is required to run 24 hours per day to provide daily usage. If Zones 2 and 3 are to be combined, water fed from the north with a 1 .25-million-gallon tank would improve flow rates and reliability into Zone 3. The overflow elevation of the proposed Roosevelt Tower has been set to match the overflow elevations of Zone 3 storage facilities, including College Street tower. When a connection between Zone 2 and Zone 3 is established, the overflow elevations would require analysis of not only Zones 2 and 3, but also Zone 1 located east of the bluff and served by the West 3rd Street in ground reservoir and Park Hill Standpipe. As Zone 1 and Zone 2 could both provide water supply and pressure to Zone 3, an analysis of how these zones can work together will enable to the City to make effective and economical water storage improvements in the future. Such storage improvements would be scheduling of water storage tank coating maintenance and eliminating water storage deficiencies present in Zone 3. The DNR regulations require water storage must be equal to the average daily use and/or the recommended fire protection volume. While excess storage is discouraged due to water quality issues that may arise, insufficient storage is equally as important. The lowa DNR supports and is in general agreement with the concepts in the PER including the connection of Zone 2 to Zone 3 allowing for the proposed water tower to be common to the demands of both zones. On March 25, 2019, The City Council awarded two construction contracts for the Water Distribution System Pressure Zone 2 Improvements: Roosevelt Street 1 .25 MG Elevated Water Tower Project. Contract A was awarded to CB&I, LLC of Plainfield, Illinois in the amount of $2,928,600. Contract A includes the Roosevelt Street Water Tower and Water Distribution Improvements. The extent of the work consists of the construction of a 1 .25 MG water tower and associated water main installation. The project also includes various work associated with the site improvements including earthwork, storm sewer, sanitary sewer service, clearing and grubbing, PCC pavement, seeding, and erosion control. Traffic control is included in the project to maintain a safe work site for both the contractor and the public. Contract B was awarded to Portzen Construction of Dubuque, lowa in the amount of $986,620. Contract B includes the Eagle Point Park Treatment Plant and Water Distribution Improvements. The extent of the work consists of the construction of four pressure control stations. Two of the stations will be cast-in-place, 10-fott by 14-foot 3-inch structures, and two of the stations will be 6-foot diameter precast manhole structures. The stations will include control valves and process piping. The construction of the pressure control stations will include surface restoration including PCC And HMA pavement patching and associated traffic control. Also included in the project is process piping modifications and pump replacement at the Eagle Point Pumping Facility for pumps #6 and #7 which involves controls and electrical improvements. BUDGETIMPACT The State Revolving Loan program along with Water Department cost savings are available to fund the Roosevelt Street tower project. � - � - � . � � - � Le al Loan SRF •$25,000 Easements Easements SRF $4,000 Construction 1 .00 MG Tower SRF $2,285,000 Construction Tower Site SRF $315,000 Construction Distribution S stem SRF $699,000 Construction Treatment Plant SRF $260,000 En ineerin Ins ection SRF $180,000 En ineerin Desi n SRF $475,000 Contin enc Contin enc SRF $133,630 Loan Initiation Loan Fee SRF $23,370 Total SRF $4,400,000 � - � - � . � � - � Construction 0.25MG Tower Water Fund $300,000 Construction Residential PRV Water Fund $67,000 En ineerin Ins ection Water Fund $101 ,500 Easements Easements Water Fund $38,432 Contin enc Contin enc Water Fund $320,740 Total Water $872,672 Total cost of the project is estimated to be $5,272,672. Contract B is estimated to be completed by November 1 , 2019 and Contract A is estimated to be completed by November 1 , 2010. The State Revolving Capital Loan Notes will carry an annual 1 .75°k interest rate for 20 years, with an annual servicing fee of 0.25°k. There is also a onetime 0.5°k upfront loan origination fee. ACTION TO BE TAKEN I respectfully recommend the adoption of the enclosed series resolution authorizing and providing for the issuance and securing the payment of $4,400,000 Water Revenue Capital Loan Notes, Series 2019 by the City of Dubuque, lowa under the provisions of Chapter 384 of the Code of lowa, providing for a method of payment, approving the Loan and Disbursement Agreement, and other related matters. This is the final City Council action required on the Water Revenue Capital Loan Notes. Attachments cc: Crenna Brumwell, City Attorney Teri Goodmann, Assistant City Manager Cori Burbach, Assistant City Manager Denise Blakeley-Ihrig, Water Department Manager ITEMS TO INCLUDE ON AGENDA CITY OF DUBUQUE, IOWA $4,400,000 Water Revenue Capital Loan Notes, Series 2019 • Approve forms of Tax Exemption Certificate and Loan and Disbursement Agreement. • Series Resolution authorizing and providing for the issuance and securing the payment of $4,400,000 Water Revenue Capital Loan Notes, Series 2019 by the City of Dubuque, Iowa under the provisions of Chapter 384 of the Code of Iowa, providing for a method of payment thereof, approving Loan and Disbursement Agreement, and other related matters NOTICE MUST BE GIVEN PURSUANT TO IOWA CODE CHAPTER 21 AND THE LOCAL RULES OF THE CITY. July 15, 2019 The City Council of Dubuque, Iowa, met in regular session, in the Historic Federal Building, 350 West 6th Street, Dubuque, Iowa, at 6:00 o'clock P.M., on the above date. There were present Mayor Roy D. Buol in the chair, and the following named Council Members: Luis Del Toro, Ric Jones, Kate Larson, David Resnick, Jake Rios, Brett Shaw Absent: * * * * * * * * * * 2 Council Member Resnick moved that the forms of Tax Exemption Certificate and Loan and Disbursement Agreement be placed on file and approved. Council Member Del Toro seconded the motion and the roll being called thereon, the vote was as follows: AYES: Larson, Shaw, Rios, Jones, Buol, Del Toro, Resnick NAYS: Council Member Resnick introduced the following Resolution entitled "SERIES RESOLUTION AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $4,400,000 WATER REVENUE CAPITAL LOAN NOTES, SERIES 2019, BY THE CITY OF DUBUQUE, IOWA UNDER THE PROVISIONS OF CHAPTER 384 OF THE CODE OF IOWA, PROVIDING FOR A METHOD OF PAYMENT THEREOF, APPROVING LOAN AND DISBURSEMENT AGREEMENT, AND OTHER RELATED MATTERS", and moved its adoption. Council Member Del Toro seconded the motion to adopt. The roll was called and the vote was: AYES: Larson, Shaw, Rios, Jones, Buol, Del Toro, Resnick NAYS: Whereupon the Mayor declared the following Resolution duly adopted: 3 RESOLUTION NO. 258-19 SERIES RESOLUTION AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $4,400,000 WATER REVENUE CAPITAL LOAN NOTES, SERIES 2019 BY THE CITY OF DUBUQUE, IOWA UNDER THE PROVISIONS OF CHAPTER 384 OF THE CODE OF IOWA, PROVIDING FOR A METHOD OF PAYMENT THEREOF, APPROVING LOAN AND DISBURSEMENT AGREEMENT, AND OTHER RELATED MATTERS WHEREAS, the City Council of the City of Dubuque, Iowa (the "City") has heretofore established charges, rates and rentals for services which are and will continue to be collected as system revenues of the Municipal Water Utility System, and said revenues are available for the payment of water revenue bonds or notes, subject to the following premises; and WHEREAS, by Resolution No. 379-08 passed and approved on October 20, 2008 (the "Master Resolution"), the City Council heretofore has authorized the issuance of $1,195,000 Water Revenue Capital Loan Notes, Series 2008D, for the purpose of financing the construction of the Series 2008D Project described therein, and to pay related costs of issuance; and WHEREAS, Issuer proposes to issue its Water Revenue Capital Loan Notes, Series 2019, to the extent of $4,400,000, for the purpose of defraying the costs of the Series 2019 Projects as set forth in Section 1 of this Resolution; and, it is deemed necessary and advisable and in the best interests of the City that a form of Loan and Disbursement Agreement by and between the City and the Iowa Finance Authority, be approved and authorized; and WHEREAS, notice of the intention of the City Council to take action for the issuance of not to exceed $4,400,000 Water Revenue Capital Loan Notes has heretofore been duly published and no objections to such proposed action have been filed, and the City therefore deems it desirable to enter into a Loan and Disbursement Agreement and issue the Notes; and WHEREAS, Section 8.3 of the Master Resolution authorizes the issuance of additional Senior Bonds, including Senior SRF Bonds, by the City from time to time, if all of the conditions set forth therein are satisfied; and WHEREAS, the Council has determined to issue additional Senior SRF Bonds, and has . determined that, upon passage of this Series Resolution and receipt of the reports described in Section 8.3 of the Master Resolution, all of the requirements of Article VIII of the Master Resolution with respect to the issuance of additional Senior SRF Bonds will have been satisfied. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IN THE COUNTY OF DUBUQUE, STATE OF IOWA: 4 ARTICLE I DEFINITIONS Section 1.1. Definitions. Except as otherwise provided below in this Article I, all words and terms defined in Article I of the Master Resolution shall have the same meanings in this Series Resolution as such defined words and terms are given in Article I of the Master Resolution. In addition, the following terms shall have the following meanings in this Series Resolution unless the text expressly or by necessary implication requires otherwise: "Agreement" shall mean Loan and Disbursement Agreement dated as of the Closing between the City and the Original Purchaser relating to the Loan made to the City under the Program. "City" or "Issuer" shall mean the City of Dubuque, Iowa. "Closing" shall mean the date of execution of the Agreement and delivery of the Series 2019 Notes to the Original Purchaser and the funding of the Loan. "Loan" shall mean the total principal amount allocated by the Original Purchaser to the City under the Program, equal in amount to the aggregate principal amount of the Series 2019 Notes. "Master Resolution" means the City Council Resolution No. 379-08, passed and approved on October 20, 2008, entitled "Master Resolution relating to the issuance of Water Revenue Bonds by the City of Dubuque, Iowa under the provisions of Chapter 384 of the Code of Iowa, authorizing and providing for the issuance and securing the payment of S1,195,000 Water Revenue Bonds, Series 2008D, providing for a method of payment thereof, funding a Debt Service Reserve Fund, and related matters," as the same may be amended from time to time. "Original Purchaser" means the Iowa Finance Authority, as the purchaser of the Series 2019 Notes from the City at the time of their original issuance. "Program" shall mean the Iowa Drinking Water Works Financing Program administered by the Original Purchaser. "Series 2019 Notes" means the $4,400,000 Water Revenue Capital Loan Notes, Series 2019, dated the date of delivery, authorized to be issued pursuant to this Series Resolution. "Series 2019 Costs of Issuance Account" means the account by that name within the Project Fund established in Section 5.1 of the Master Resolution. "Series 2019 Projects" shall mean the Projects being financed with the proceeds of the Series 2019 Notes, consisting of costs of acquisition, construction, reconstruction, extending, remodeling, improving, repairing and equipping all or part of the Municipal 5 Water System, including those costs associated with the Roosevelt Street water tower and water distribution improvements project and the Eagle Point water treatment plant and water distribution improvements project; and refunding the Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017, dated September 22, 2017, as described generally in the Agreement and more particularly in the plans and specifications on file from time to time with the City Clerk. "Series 2019 Projects Account" means the account by that name within the Project Fund established in Section 5.1 of the Master Resolution. "Series 2019 Rebate Account" means the account by that name within the Rebate Fund established in Section 6.10 of the Master Resolution. "Series Resolution" means this Resolution of the Council. "Tax Exemption Certificate" means the Tax Exemption Certificate executed by the Treasurer and delivered at the time of issuance and delivery of the Series 2019 Notes. "Yield Restricted" shall mean required to be invested at a yield that is not materially higher than the yield on the Notes under Section 148(a) of the Internal Revenue Code or regulations issued thereunder. ARTICLE II THE SERIES 2019 Notes Section 2.1. Series 2019 Notes - Authorization and Purpose. Pursuant to the provisions of the Master Resolution and in particular Section 8.3 thereof, there are hereby authorized to be issued, negotiable, serial, fully registered Water Revenue Capital Loan Notes, Series 2019, in the aggregate principal amount of $4,400,000, dated the date of delivery, for the purpose of constructing the Series 2019 Projects and paying Project Costs relating thereto, and to pay related Costs of Issuance. The Series 2019 Notes shall be issued as Senior SRF Bonds under the terms of the Master Resolution, shall be designated "CITY OF DUBUQUE, IOWA, WATER REVENUE CAPITAL LOAN NOTES, SERIES 2019", and bear interest from the date hereof, until payment thereof, at the office of the Paying Agent, said interest payable on December 1, 2019 and semiannually thereafter on the 1st day of June and December in each year until maturity at the rate hereinafter provided. The Council, pursuant to Sections 384.24A and 384.83 of the Code of Iowa, hereby finds and determines that it is necessary and advisable to issue said Series 2019 Notes authorized by the Agreement and this Series Resolution. The Series 2019 Notes and the Registrar's Certificate of Authentication shall be in substantially the form set forth in Exhibit A attached hereto, with such variations, omissions, substitutions and insertions as are required or permitted by this Series Resolution. The Series 2019 Notes shall be executed by the manual or facsimile signature of the Mayor and attested by the manual or facsimile signature of the City Clerk of the Council, and shall be fully registered as to both principal and interest as provided in this Series Resolution; 6 principal, interest and premium, if any shall be payable at the office of the Paying Agent by mailing of a check, wire transfer or automated clearing house system transfer to the registered owner of the Bond. The Series 2019 Notes shall be dated the date of delivery, and bear interest at the rate of 1.75% per annum from the date of each advancement made under the Agreement, until payment thereof, at the office of the Paying Agent, said interest payable on December 1, 2019, and semi- annually thereafter on the 1st day of June and December in each year until maturity as set forth on the debt service schedules attached to the Agreement as Exhibit A and incorporated herein by this reference. As set forth on said debt service schedules, principal shall be payable on June 1, 2021 and annually thereafter on the 1st day of June in the amounts set forth therein until principal and interest are fully paid, except that the final installment of the entire balance of principal and interest, if not sooner paid, shall become due and payable on June 1, 2040. Notwithstanding the foregoing or any other provision hereof, principal and interest shall be payable as shown on said debt service schedules until completion of the Series 2019 Project, at which time the final debt service schedules shall be determined based upon actual advancements, final costs and completion of the Series 2019 Project, all as provided in the administrative rules governing the Program. Payment of principal and interest on the Series 2019 Notes shall at all times conform to said debt service sand the rules of the Program. In addition to the payment of principal of and interest on the Series 2019 Notes, the City also agrees to pay the Initiation Fee and the Servicing Fee as defined and in accordance with the terms of the Agreement. Section 2.2. Issuance of Series 2019 Notes in Certificated Form. The Series 2019 Notes shall be issued as bonds in Authorized Denominations and may, at the request of the Original Purchaser, be issued in the denomination of $1,000 or multiples thereof as a single Note in the denomination of $4,400,000 and numbered R-1. Section 2.3. Appointment of Registrar. The Treasurer is hereby appointed as Registrar for the Series 2019 Notes under the terms of this Series Resolution. Section 2.4. Execution, Authentication and Delivery of the Series 2019 Notes. Upon the adoption of this Resolution, the Mayor and City Clerk shall execute and deliver the Series 2019 Notes to the Registrar, who shall authenticate the same and deliver the same to or upon order of the Original Purchaser. No such Series 2019 Note shall be valid or obligatory for any purpose or shall be entitled to any right or benefit hereunder unless the Registrar shall duly endorse and execute on such Series 2019 Note a Certificate of Authentication substantially in the form of the Certificate herein set forth. Such Certificate upon any such Series 2019 Note executed on behalf of the Issuer shall be conclusive evidence that the Series 2019 Note so authenticated has been duly issued under this Series Resolution and that the holder thereof is entitled to the benefits of this Series Resolution. 7 ARTICLE III REDEMPTION OF BONDS Section 3.1. Optional Redemption. The Series 2019 Notes are subject to optional redemption at a price of par plus accrued interest (i) on any date upon receipt of written consent of the Original Purchaser or (ii) in the event that all or substantially all of the Series 2019 Projects are damaged or destroyed. Any optional redemption of the Series 2019 Notes may be made from any funds regardless of source, in whole or from time to time in part, in inverse order of maturity, by giving not less than thirty (30) days notice of redemption by certified or registered mail to the Original Purchaser (or any other registered owner of the Series 2019 Notes). The terms of redemption shall be par, plus accrued interest to date of call. The Series 2019 Notes are also subject to mandatory redemption as set forth in Section 5 of the Agreement. ARTICLE IV DELIVERY AND APPLICATION OF PROCEEDS Section 4.1. Application of Series 2019 Note Proceeds. The Series 2019 Notes shall be delivered as provided in Sections 6.1 and 6.2 and the proceeds thereof shall be applied as follows: (i) An amount sufficient to pay the Costs of Issuance of the Series 2019 Notes shall be deposited into the Series 2019 Costs of Issuance Account. (ii) The balance of proceeds shall be deposited into the Series 2019 Projects Account of the Project Fund and applied thereafter to pay Project Costs of the Series 2019 Proj ects. Section 4.2. No Adjustment to Debt Service Reserve Requirement. The Series 2019 Notes shall be issued as Senior SRF Bonds under the Master Resolution, and shall not be secured by or payable from amounts held in the Debt Service Reserve Fund established in the Master Resolution. Upon issuance of the Series 2019 Notes, the amount to be accumulated and maintained in the Debt Service Reserve Fund shall not be increased, but shall continue to remain equal to 100% of the Debt Service Reserve Requirement computed on a basis which includes all Senior Bonds which will be Outstanding immediately after issuance of the Series 2019 Notes and which are not Senior SRF Bonds. ARTICLE V TAX PROVISIONS Section 5.1. Disposition of Bond Proceeds; Arbitrage Not Permitted. The City reasonably expects and covenants that no use will be made of the proceeds from the issuance and sale of the Series 2019 Notes issued hereunder which will cause any of the Series 2019 Notes to be classified as arbitrage bonds within the meaning of Section 148(a) and (b) of the Code, and that throughout the term of said Series 2019 Notes it will comply with the requirements of said statute and regulations issued thereunder. 8 To the best knowledge and belief of the City, there are no facts or circumstances that would materially change the foregoing statements or the conclusion that it is not expected that the proceeds of the Series 2019 Notes will be used in a manner that would cause such bonds to be arbitrage bonds. Without limiting the generality of the foregoing, the City hereby agrees to comply with the provisions of the Tax Exemption Certificate and the provisions of the Tax Exemption Certificate are hereby incorporated by reference as part of this Series Resolution. The Treasurer is hereby directed to make and insert all calculations and determinations necessary to complete the Tax Exemption Certificate in all respects and to execute and deliver the Tax Exemption Certificate at issuance of the Series 2019 Notes to certify as to the reasonable expectations and covenants of the City at that date. The City covenants that it will treat as Yield Restricted any proceeds of the Series 2019 Notes remaining unexpended after three years from the issuance and any other funds required by the Tax Exemption Certificate to be so treated. If any investments are held with respect to the Series 2019 Notes, the City shall treat the same for the purpose of restricted yield as held in proportion to the original principal amounts of each issue. The City covenants that it will exceed any investment yield restriction provided in this Series Resolution only in the event that it shall first obtain an opinion of bond counsel that the proposed investment action will not cause the Series 2019 Notes to be classified as arbitrage bonds under Section 148(a) and (b) of the Code. The City covenants that it will proceed with due diligence to spend the proceeds of the Series 2019 Notes for the purpose set forth in this Series Resolution. The City further covenants that it will make no change in the use of the proceeds available for the construction of facilities or change in the use of any portion of the facilities constructed therefrom by persons other than the City or the general public unless it has obtained an opinion of bond counsel or a revenue ruling that the proposed project or use will not be of such character as to cause interest on any of the Series 2019 Notes not to be exempt from federal income taxes in the hands of holders under the provisions of the Code. Section 5.2. Additional Covenants, Representations and Warranties of the City. The City certifies and covenants with the purchasers and holders of the Series 2019 Notes from time to time outstanding that the City through its officers, (a) will make such further specific covenants, representations and assurances as may be necessary or advisable; (b) comply with all representations, covenants and assurances contained in the Tax Exemption Certificate, which Tax Exemption Certificate shall constitute a part of the contract between the City and the owners of the Series 2019 Notes; (c) consult with bond counsel (as defined in the Tax Exemption Certificate); (d) pay to the United States, as necessary, such sums of money representing required rebates of excess arbitrage profits relating to the Series 2019 Notes; (e) file such forms, statements and supporting documents as may be required and in a timely manner; and (f) if deemed necessary or advisable by its.officers, to employ and pay fiscal agents, financial advisors, attorneys and other persons to assist the City in such compliance. 9 ARTICLE VI MISCELLANEOUS PROVISIONS Section 6.1. Delivery of Series 2019 Notes. The City shall deliver the executed Agreement and the Series 2019 Notes to the Original Purchaser at the price of par on the date of Closing. Delivery of the executed Agreement and the Series 2019 Notes shall be made to the Original Purchaser as soon as practicable after the effective date of this Series Resolution. Section 6.2. Approval of Agreement. The Agreement in substantially the form presented at this meeting of the Council are hereby authorized and approved, and the Mayor and City Clerk are authorized to execute and deliver the Agreement, with such changes therein as such officials deem appropriate, for and on behalf of the City, such officers' signatures thereon being conclusive evidence of such officials' and the City's approval thereof. Section 6.3. General Authorization. From and after the date of adoption of this Series Resolution, the officers, employees and agents of the City are hereby authorized to do all such acts and things and to execute and deliver any and all other documents, agreements, certificates and instruments relating to the Series 2019 Notes, the investment of the proceeds thereof and the other transactions contemplated on the part of the City by this Series Resolution, including, but not limited to, the Tax Exemption Certificate referred to in Section 5.1 hereof. Section 6.4. Construction. Except to the extent set forth herein, all of the applicable terms, conditions and provisions of the Master Resolution shall be deemed and construed to apply to the Series 2019 Notes and are hereby incorporated by reference and made a part hereof to the same extent as if fully set forth herein. Except as may otherwise be provided herein, the Master Resolution shall remain in full force and effect. Section 6.5. Severability. If any section, paragraph, or provision of this Series Resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions. Section 6.6. Repeal of Conflicting Ordinances or Resolutions and Effective Date. All other ordinances, resolutions and orders, or parts thereof, in conflict with the provisions of this Series Resolution are, to the extent of such conflict, hereby repealed; and this Series Resolution shall be in effect from and after its adoption. - 10 - PASSED AND APPROVED this 15th day of July, 2019. ATTEST: - 11 - CERTIFICATE STATE OF IOWA ) SS COUNTY OF DUBUQUE ) I, the undersigned City Clerk of Dubuque, Iowa, do hereby certify that attached is a true and complete copy of the portion of the corporate records of said Municipality showing proceedings of the Council, and the same is a true and complete copy of the action taken by said Council with respect to said matter at the meeting held on the date indicated in the attachment, which proceedings remain in full force and effect, and have not been amended or rescinded in any way; that meeting and all action thereat was duly and publicly held in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the Council and posted on a bulletin board or other prominent place easily accessible to the public and clearly designated for that purpose at the principal office of the Council (a copy of the face sheet of said agenda being attached hereto) pursuant to the local rules of the Council and the provisions of Chapter 21, Code of Iowa, upon reasonable advance notice to the public and media at least twenty-four hours prior to the commencement of the meeting as required by said law and with members of the public present in attendance; I further certify that the individuals named therein were on the date thereof duly and lawfully possessed of their respective city offices as indicated therein, that no Council vacancy existed except as may be stated in said proceedings, and that no controversy or litigation is pending, prayed or threatened involving the incorporation, organization, existence or boundaries of the City or the right of the individuals named therein as officers to their respective positions. WI ESS my hand and the seal of said Municipality hereto affixed this , 2019. SEAL City Cler ; 1 ubuque, Iowa - 12 - day of EXHIBIT A REGISTERED REGISTERED Certificate No. R-1 Principal Amount $4,400,000 Interest Rate 1.750% UNITED STATES OF AMERICA STATE OF IOWA COUNTY OF DUBUQUE CITY OF DUBUQUE WATER REVENUE CAPITAL LOAN NOTE SERIES 2019 Final Maturity Date June 1, 2040 Note Date August 9, 2019 The City of Dubuque, Iowa, a municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of Iowa (the "Issuer"), for value received, promises to pay from the source and as hereinafter provided, to IOWA FINANCE AUTHORITY or registered assigns, the principal sum of FOUR MILLION FOUR HUNDRED THOUSAND DOLLARS in lawful money of the United States of America, on the maturity dates and in the principal amounts set forth on the Debt Service Schedule attached hereto and incorporated herein by this reference, with interest on said sum from the date of each advancement made under a certain Loan and Disbursement Agreement dated as of the date hereof until paid at the rate of 1.75% per annum, payable on December 1, 2019, and semi-annually thereafter on the 1st day of June and December in each year. As set forth on said Debt Service Schedule, principal shall be payable on June 1, 2021 and annually thereafter on the first day of June in the amounts set forth therein until principal and interest are fully paid, except that the final installment of the entire balance of principal and interest, if not sooner paid, shall become due and payable on June 1, 2040. Notwithstanding the foregoing or any other provision hereof, principal and interest shall be payable as shown on said Debt Service Schedule until completion of the Project, at which time the final Debt Service Schedule shall be determined and attached hereto based upon actual advancements, final costs and completion of the Project, all as provided in the administrative rules governing the Iowa Drinking Water Facilities Financing Program. Payment of principal and interest of this Note shall at all times conform to said Debt Service Schedule and the rules of the Drinking Water State Revolving Fund Program. Interest and principal shall be paid to the registered holder of the Note as shown on the records of ownership maintained by the Registrar as of the 15th day of the month next preceding such interest payment date. Interest shall be computed on the basis of a 360 -day year of twelve 30 - day months. This Note is issued pursuant to the provisions of Sections 384.24A and 384.83 of the Code of Iowa, for the purpose of paying costs of acquisition, construction, reconstruction, extending, remodeling, improving, repairing and equipping all or part of the Municipal Water System, including those costs associated with the Roosevelt Street water tower and water distribution improvements - 13 - project and the Eagle Point water treatment plant and water distribution improvements project; and refunding the Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017, dated September 22, 2017, and evidences amounts payable under a certain Loan and Disbursement Agreement dated as of the date hereof, in conformity to a Master Resolution of the City Council of said City duly passed and approved on October 20, 2008 (the "Master Resolution") and a Series Resolution of the City Council of said City duly passed and approved on July 15, 2019 (the "Series Resolution"). For a complete statement of the revenues and funds from which and the conditions under which this Note is payable, a statement of the conditions under which additional series notes or bonds of equal standing may be issued, and the general covenants and provisions pursuant to which this Note is issued, reference is made to the above-described Loan and Disbursement Agreement, the Master Resolution and the Series Resolution. This Note is one of the Series 2019 Notes authorized for issuance in the Series Resolution. Capitalized terms not defined herein shall have the meanings given to them in the Series Resolution or Master Resolution. This Note is subject to optional redemption at a price of par plus accrued interest (i) on any date upon receipt of written consent of the Iowa Finance Authority or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any optional redemption of this Note may be made from any funds regardless of source, in whole or from time to time in part, in inverse order of maturity, by lot by giving thirty (30) days' notice of redemption by certified or registered mail, to the Iowa Finance Authority (or any other registered owner of the Note). This Note is also subject to mandatory redemption as set forth in Section 5 of the Agreement. Ownership of this Note may be transferred only by transfer upon the books kept for such purpose by the Director of Finance and Budget/City Treasurer, City of Dubuque, Iowa the Registrar. Such transfer on the books shall occur only upon presentation and surrender of this Note at the office of the Registrar, together with an assignment duly executed by the owner hereof or his duly authorized attorney in the form as shall be satisfactory to the Registrar. Issuer reserves the right to substitute the Registrar and Paying Agent but shall, however, promptly give notice to registered Noteholders of such change. All Notes shall be negotiable as provided in Article 8 of the Unifotni Commercial Code and subject to the provisions for registration and transfer contained in the Note Resolution. This Note and the series of which it forms a part, other obligations ranking on a parity therewith, and any additional obligations which may be hereafter issued and outstanding from time to time on a parity with said Notes as Senior Bonds under the Master Resolution, are payable from and secured by a pledge of the Net Revenues of the municipal water utility (the "System"), as defined and provided in the Master Resolution. There has heretofore been established and the City covenants and agrees that it will maintain just and equitable rates or charges for the use of and service rendered by said System in each year for the payment of the proper and reasonable expenses of operation and maintenance of said System and for the establishment of a sufficient sinking fund to meet the principal of and interest on this series of Notes, and other obligations ranking on a parity therewith, as the same become due. This Note is not payable in any manner by taxation and under no circumstances shall the City be in any manner liable by reason of the failure of said Net Revenues to be sufficient for the payment hereof. - 14 - The Issuer has covenanted and hereby covenants and agrees at all times while any Senior Bonds are Outstanding and unpaid to budget for and collect amounts in respect of the use of the System fully sufficient at all times to: (i) provide for 100% of the budgeted Operation and Maintenance Expenses of the System and (ii) produce Net Revenues in each Fiscal Year which will: (a) equal at least 110% of the Debt Service Requirement on all Senior Bonds then Outstanding for the year of computation, (b) enable the Issuer to make all required payments, if any, into the Debt Service Reserve Fund and the Rebate Fund, (c) enable the Issuer to accumulate an amount which, in the judgment of the Council, is adequate to meet the costs of major renewals, replacements, repairs, additions, betterments and improvements to the System, necessary to keep the same in good operating condition or as is required by any governmental agency having jurisdiction over the System, and (d) remedy all deficiencies in required payments into any of the funds and accounts established under the Master Resolution from prior Fiscal Years. The Master Resolution contains a more particular statement of the covenants and provisions securing the Senior Bonds, the conditions under which the owner of this Note may enforce covenants (other than the covenant to pay Principal of and interest on this Note when due from the sources provided, the right to enforce which is unconditional), the conditions upon which additional Senior Bonds may be issued on a parity or achieve parity status with this Note under the Master Resolution, and the conditions upon which the Master Resolution may be amended with the consent of the owners of not less than two-thirds in aggregate Principal amount of the Bonds Outstanding or the issuer of any Credit Facility, if any, of such Bonds. Upon the occurrence of an Event of Default under the Master Resolution, the owner of this Note shall be entitled to the remedies provided by the Master Resolution. And it is hereby represented and certified that all acts, conditions and things requisite, according to the laws and Constitution of the State of Iowa, to exist, to be had, to be done, or to be performed precedent to the lawful issue of this Note, have been existent, had, done and performed as required by law. IN TESTIMONY WHEREOF, said City by its City Council has caused this Note to be signed by the manual or facsimile signature of its Mayor and attested by the manual or facsimile signature of its City Clerk, with the seal of said City impressed hereon, and authenticated by the manual or facsimile signature of an authorized representative of the Registrar, the City Treasurer of the City of Dubuque, Iowa, all as of the day of , 2019. - 15 - Date of authentication: CITY OF DUBUQUE, STATE OF IOWA This is one of the Notes described in the within mentioned Resolution, as registered by the City By: Treasurer Mayor CITY TREASURER, Registrar ATTEST: By: Authorized Signature By: City Clerk (SEAL) Registrar and Transfer Agent: City Treasurer Paying Agent: City Treasurer ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto (Social Security or Tax Identification No. ) the within Note and does hereby irrevocably constitute and appoint attorney in fact to transfer the said Note on the books kept for registration of the within Note, with full power of substitution in the premises. Dated: (Person(s) executing this Assignment sign(s) here) SIGNATURE ) GUARANTEED) IMPORTANT - READ CAREFULLY The signature(s) to this Power must correspond with the name(s) as written upon the face of the certificate(s) or Note(s) in every particular without alteration or enlargement or any change whatever. Signature guarantee must be provided in accordance with the prevailing standards and procedures of the Registrar and Transfer Agent. Such standards and procedures may require signature to be guaranteed by certain eligible guarantor institutions that participate in a recognized signature guarantee program. - 16- INFORMATION REQUIRED FOR REGISTRATION OF TRANSFER Name of Transferee(s) Address of Transferee(s) Social Security or Tax Identification Number of Transferee(s) Transferee is a(n): Individual* Corporation Partnership Trust *If the Note is to be registered in the names of multiple individual owners, the names of all such owners and one address and social security number must be provided. The following abbreviations, when used in the inscription on the face of this Note, shall be construed as though written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with rights of survivorship and not as tenants in common IA UNIF TRANS MIN ACT - Custodian (Cult) (Minor) Under Iowa Unifoinl Transfers to Minors Act (State) ADDITIONAL ABBREVIATIONS MAY ALSO BE USED THOUGH NOT IN THE ABOVE LIST 01605185-1\10422-197 - 17- Loan summary Loan Closing Date Final Disbursement Date Final Maturity Date Loan Period in Years Total Loaned Amount $ 0.5%Initiation Fee Net Proceeds to Borrower Annual Interest Rate Total Interest Servicing Fee Rate Total Servicing Fees Total Loan Costs Estimated Amortization Schedule City of Dubuque Water Revenue Bond FS-31-19-DWSRF-014 Aug 9, 2019 Nov 20, 2020 Jun 1, 2040 20 4,400,000.00 22,000.00 $ 4,378,000.00 1.75% $ 878,081.77 0.25% $ 125,440.26 $ 1,025,522.03 Estimated Draw Schedule Aug 9, 2019 Aug 9,2019 Aug 9,2019 Sep 27, 2019 Nov 15, 2019 Jan 3, 2020 Feb 21,2020 Apr 10, 2020 May 29, 2020 Jul 17, 2020 Sep 4,2020 Oct 23, 2020 Nov 20, 2020 Initiation Fee - P & D Payoff - Estimated Draw #1 - Estimated Draw #2 - Estimated Draw #3 - Estimated Draw #4 - Estimated Draw #5 - Estimated Draw #6 - Estimated Draw #7 - Estimated Draw #8 - Estimated Draw #9 - Estimated Draw #10 - Held for Final Docs - Total Loaned Amount 22,000.00 444,162.62 375,583.74 375,583.74 SRF STATE REVCIL1/ING U9F 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583,74 375,583.74 178,000.00 4,400,000.00 Payment Beginning Date Balance Principal Servicing Total Loan Total Annual Debt Interest Fee Payment Service Ending Balance Dec 1, 2019 1,217,330.10 Jun 1, 2020 2,719,665.05 Dec 1, 2020 4,222,000.00 Jun 1, 2021 Dec 1, 2021 Jun 1, 2022 Dec 1, 2022 Jun 1, 2023 Dec 1, 2023 Jun 1, 2024 Dec 1, 2024 Jun 1 2025 Dec 1, 2025 Jun 1, 2026 Dec 1, 2026 Jun 1, 2027 Dec 1, 2027 Jun 1, 2028 Dec 1, 2028 Jun 1, 2029 Dec 1, 2029 Jun 1, 2030 Dec 1, 2030 Jun 1, 2031 Dec 1, 2031 Jun 1, 2032 Dec 1, 2032 Jun 1, 2033 Dec 1, 2033 Jun 1, 2034 Dec 1, 2034 Jun 1, 2035 Dec 1, 2035 Jun 1, 2036 Dec 1, 2036 Jun 1, 2037 Dec 1, 2037 Jun 1, 2038 Dec 1, 2038 Jun 1, 2039 Dec 1, 2039 Jun 1, 2040 As of 6/25/2019 4,400,000.00 4,219,000.00 4,219,000.00 4,034,000.00 4,034,000.00 3,846,000.00 3,846,000.00 3,654,000.00 3,654,000.00 3,458,000.00 3,458,000.00 3,258,000.00 3,258,000.00 3,054,000.00 3,054,000.00 2,846,000.00 2,846,000.00 2,634,000.00 2,634,000.00 2,418,000.00 2,418,000.00 2,197, 000.00 2,197, 000.00 1,972,000.00 181,000.00 185,000.00 188,000.00 192,000.00 196,000.00 200,000.00 204,000.00 208,000.00 212,000.00 216,000 00 221,000.00 225,000.00 5,751.32 19, 689.12 31, 848.65 38,595.18 36,916.25 36,916.25 35,297.50 35,297.50 33,652.50 33,652.50 31, 972.50 31,972.50 30,257.50 821.62 6,572.94 2,812.73 22,501.85 4,549.81 36,398.46 5,513,60 225,108.78 5,273.75 42,190.00 5,273.75 227,190.00 5,042.50 40,340.00 5,042.50 228,340.00 4,807.50 38,460.00 4,807.50 4,567.50 4,567.50 4,322.50 230,460.00 36,540.00 232,540.00 34,580.00 30,257.50 4,322.50 234,580.00 28 507.50 4,072.50 32,580.00 28,507.50 4,072.50 236,580.00 26,722.50 3,817.50 30,540.00 26,722.50 , 3,817.50 238,540.00 24,902.50 3,557.50 28,460.00 24,902.50 23,047.50 23,047.50 21,157.50 21,157.50 19,223.75 19, 223.75 17,255.00 1,972,000.00 230,000.00 17,255.00 1,742,000.00 15, 242.50 1,742,000.00 234,000.00 1,508,000.00 1,508,000.00 239,000.00 1, 269, 000.00 1,269,000.00 244,000.00 1,025,000.00 1,025,000.00 249,000.00 --_. 776,000.00 776,000.00 253,000.00 523,000.00 523,000.00 259,000.00 264,000.00 264,000.00 264,000.00 15,242.50 13,195.00 13,195.00 11,103.75 11,103.75 8,968.75 8,968.75 6,790.00 6,790.00 4,576.25 4,576.25 2,310.00 2,310.00 3,557.50 240,460.00 3,292.50 26,340.00 3,292.50 3,022.50 3,022.50 2,746.25 2,746.25 2,465.00 2,465.00 2,177.50 2,177.50 1,885.00 242,340.00 24,180.00 245,180.00 21, 970.00 246,970.00 19,720.00 249,720.00 17,420.00 2.51,420.00 15,080.00 1,885,00 254,080.00 1,586.25 12, 690.00 1,586.25 256,690.00 1,281.25 10,250.00 1,281.25 259,250.00 970.00 7,760.00 970.00 260,760.00 653.75 5,230.00 653.75 264,230.00 330.00 2,640.00 330.00 266,640.00 29,074.79 261, 507.24 269,380.00 268,680.00 268,920.00 269,080.00 269,160.00 269,160.00 269,080.00 268,920.00 268 680.00 269,360.00 268 940.00 269,440.00 268,840.00 1,217,330.10 2,719, 665.05 4,222,000.00 4,219, 000.00 4,219,000 00 4,034,000.00 4, 034, 000.00 3, 846, 000.00 ' 3,846,000.00 3,654,000.00 3,654 000.00 3,458,000.00 3,458,000.00 3,258,000.00 3,258 000.00 3,054,000.00 3,054,000.00 2,846,000.00 2,846 000.00 2,634,000.00 2, 634, 000.00 2,418,000.00 2,418,000.00 2,197, 000.00 2,197 000.00 1,972 000 00 1,972 000 00 1,742,000.00 1,742,000.00 1,508, 000.00 1,508,000.00 269,160.00 1,269,000.00 1,269,000.00 269,380.00 1, 025; 000.00 1,025,000.00 269,500.00 776,000.00 776,000.00 268,520.00 523,000.00 523 000.00 269,460.00 264,000.00 264,000.00 269,280.00 0.00 INVESTING IN IOWA'S WATER www.iowasrf.com LOAN AND DISBURSEMENT AGREEMENT $4,400,000 WATER REVENUE CAPITAL LOAN NOTES, SERIES 2019(IOWA DRINKING WATER FACILITIES FINANCING PROGRAIV� (ROOSEVELT/EAGLE POINT) This Loan and Disbursement Agreement(the "AgreemenY') is made and entered into as of August 9, 2019 by and between the City of Dubuque, Iowa (the "ParticipanY� and the Iowa Finance Authority, an agency and public instrumentality of the State of Iowa(the "Issuer'�. WHEREAS, the Issuer, in cooperation with the Iowa Department of Natural Resources (the "DepartmenY�, is authorized to undertake the creation, administration and financing of the Iowa Drinking Water Facilities Financing Program (the "Program") established in Iowa Code Sections 16.131 through 16.135 and Sections 455B.291 through 455B.299, including, among other things, the making of loans to Water Systems for purposes of the Program; and WHEREAS, the Participant desires to participate in the Program as a means of financing all or part of the construction of certain drinking water treatment facilities serving the Participant and its residents; and WHEREAS, to assist in financing the Project(defined herein), the Issuer desires to make a loan to the Participant in the amount set forth in Section 2 hereof; NOW, THEREFORE,the parties agree as follows: Section 1. Definitions. In addition to other definitions set forth herein, the following terms as used in this Agreement shall, unless the conteat clearly requires otherwise, have the following meanings: (a) `Bonds"shall mean any State Revolving Fund Revenue Bonds that were or in the future are issued by the Issuer for the purpose of providing moneys to finance the Loan to the Participant. (b) "Code"shall mean the Internal Revenue Code of 1986, as amended, and all lawfully promulgated regulations thereunder. (c) "ProjecY' shall mean the particular construction activities approved by the Department and being undertaken by the Participant with respect to the operation or infrastructure of the Water System for the purpose of providing safe drinking water to the customers thereof, as described in the Resolution. (d) "Regulations" shall mean the administrative rules of the Department relating to the Program, setforth in Title 567, Chapter 44 ofthe Iowa Administrative Code, and the administrative rules of the Issuer relating to the Program set forth in Title 265, Chapter 26 of the Iowa Administrative Code. (e) "Resolution" shall mean the resolution of the City Council of the Participant, adopted on July 15, 2019, approving and authorizing the execution of this Agreement and the issuance of the Revenue Bond (as defined herein). 1 obizsizoib (� "Water System"shall mean the drinking water system ofthe Participant, all facilities being used in conjunction therewith and all appurtenances and ea�tensions thereto, including but not limited to the water facilities which the Participant is financing under this Agreement. Section 2. Loan: Purchase of Revenue Bond. The Issuer agrees to purchase a duly authorized and issued water revenue bond or capital loan note of the Participant (the "Revenue Bond") in order to make a loan to the Participant, and will disburse proceeds as set forth herein. The Participant agrees to borrow and accept from the Issuer, a loan in the principal amount of $4,400,000 (the "Loan'�. The Participant shall use the proceeds of the Loan strictly (a) to finance a portion of the costs of construction of the Project and (b), where applicable, to reimburse the Participant for a portion of the costs of the Project, which portion was paid or incurred in anticipation of reimbursement through the Program and which is eligible for such reimbursement under and pursuant to the Regulations and the Code. Section 3. Disbursements. Proceeds of the Loan shall be made available to the Participant in the form of one or more periodic disbursements as provided in this Section. The Issuer thereafter shall make disbursements of a portion of the Loan for payment of costs of the Project upon receipt of the following: (a) a completed payment request on a form acceptable to and available from the Issuer; (b) current construction payment estimates; (c) engineering service statements; (d) purchase orders or invoices for items not included within other contracts; and (e) evidence that the costs for which the disbursement is requested have been incurred. Solely with respect to the request far the final disbursement of proceeds of the Loan, the Participant shall submit to the Issuer (via the Department), in addition to items (a) through (e) above, a certification of completion and acceptance of the Project by the Participant or evidence of an acceptable settlement if the Project is subject to a dispute between the Participant and any contractor. Disbursements shall be made in a timely fashion following the receipt of the information as set forth above. Unless otherwise agreed to in writing by the Issuer, funds shall be payable to the Participant via automated clearinghouse system transfer to the account specified by the Participant. Section 4. Completion of Project. The Participant covenants and agrees (i)to exercise its best efforts in accordance with prudent water treatment utility practices to complete the Project; 2 and (ii)to provide from its own fiscal resources all monies, in excess of the total amount of Loan proceeds it receives under the Agreement, required to complete the Project. Section 5. Renavment of Loan: Issuance of Revenue Bonds. The ParticipanYs obligation to repay the Loan and interest thereon shall be evidenced by the Revenue Bond in the principal amount of the Loan, complying in all material respects with the Regulations and being in substantially the form set forth in the Resolution. The Revenue Bond shall be delivered to the Issuer as the original purchaser and registered holder thereof at the closing of the Loan. The Revenue Bond shall be accompanied by a legal opinion of bond counsel, in form satisfactory to the Issuer, to evidence the legality, security position and tax-exempt status of interest on the Revenue Bond. The parties agree that a payment of principal of or interest on the Revenue Bond shall be deemed to be a payment of the same on the Loan and a payment of principal of or interest on the Loan shall be deemed to be a payment ofthe same on the Revenue Bond. Unless otherwise agreed to in writing by the Issuer, all payments of principal and interest due under the Loan shall be made via automated clearinghouse transfer,from an account specified by the Participant. The Revenue Bond shall be dated the date of delivery to the Issuer, with interest and the Servicing Fee (together, the "Interest Rate" as set forth in Section 6 hereo� payable semiannually on June 1 and December 1 of each year (unless the resolution authorizing a previous series of outstanding bonds on a parity with the Revenue Bond requires interest to be paid on other interest payment dates, in which case such other dates shall apply)from the date of each disbursement of a part of the Loan from the Issuer to the Participant (which are initially expected to be on approximately the dates set forth on Exhibit A attached hereto and incorparated herein). The first repayment ofprincipal ofthe Loan shall be due and payable not later than one year after substantial completion of the Project and payments of principal, interest and the Servicing Fee shall continue thereafter until the Loan is paid in full. Following the final disbursement of Loan proceeds to the Participant, Exhibit A shall be adjusted by the Issuer, with the approval of the Participant, based upon actual disbursements to the Participant under the Agreement. Such revised Exhibit A thereafter shall be deemed to be incorparated herein by reference and made a part hereof and shall supersede and replace that initially attached hereto and to the Revenue Bond. The Revenue Bond shall be subject to optional redemption by the Participant at a price of par plus accrued interest(i) on any date upon receipt of written consent by the Issuer, ar(ii) in the event that all or substantially all of the Project is damaged or destroyed. Any such optional redemption of the Revenue Bond by the Participant may be made from any funds regardless of source, in whole or from time to time in part, upon not less than thirty (30) days notice of redemption by e-mail, facsimile, certified or registered mail to the Issuer (or any other registered owner of the Revenue Bond). The Revenue Bond is also subject to mandatory redemption in the eventthe costs ofthe Project are less than initially projected, in which case the amount ofthe Loan shall be reduced to an amount equal to the actual Project costs disbursed. The Participant and the Issuer agree that following such adjustment, the principal amount due under the Revenue Bond shall be automatically reduced to equal the principal amount of the adjusted Loan. The Revenue Bond and the interest thereon and any additional obligations as may be hereafter issued and outstanding from time to time under the conditions set forth in the Resolution shall be payable solely and only from the Net Revenues (as defined in the Resolution)ofthe Water System of the Participant, a sufficient portion of which has been and shall be ordered set aside and 3 pledged for such purpose under the provisions of the Resolution. Neither this Agreement nor the Revenue Bond is a general obligation of the Participant, and under no circumstance shall the Participant be in any manner liable by reason of the failure of the aforesaid Net Revenues to be sufficient to pay the Revenue Bond and the interest thereon ar to otherwise discharge the ParticipanYs obligation hereunder. Section 6. Interest Rate. Initiation Fee and Servicin�Fees. (a) The Participant agrees to pay to the Issuer, as additional consideration far the Loan, a loan initiation fee (the "Initiation Fee") equal to one half of one percent(0.50) of the amount of the Loan ($22,000), which shall be due and payable on the date of this Agreement. Unless the Issuer shall be otherwise notified by the Participant that the Participant intends to pay such Initiation Fee from other funds, and has received such other funds from the Participant on the date hereof,the Issuer shall be authorized to deduct the full amount of the Initiation Fee from the proceeds of the Loan being made hereunder, and such deduction by the Issuer shall be deemed to be an expenditure by the Participant of the Loan proceeds. (b) The Participant agrees to pay a Loan servicing fee (the "Servicing Fee")to the Issuer in an amount equal to 0.25% per annum of the principal amount of the Loan outstanding. The Servicing Fee shall be paid as described in Section 5 and Section 6(c)hereof. (c) The Loan shall bear interest at 1.75%per annum (the "Rate"). As described in Section 5, payments hereunder shall be calculated based on the Rate plus the Servicing Fee (such 2.00%, the "Interest Rate"). Section 7. Comnliance with Annlicable Laws. Performance Under Loan Aereement: Rates. The Participant covenants and agrees (i) to comply with all applicable State of Iowa and federal laws,rules and regulations (including but not limited to the Regulations),judicial decisions, and executive orders in the performance of the Agreement and in the financing, construction, operation, maintenance and use of the Project and the Water System; (ii) to maintain its Water System in good repair, working order and operating condition; (iii)to cooperate with the Issuer in the observance and performance of its respective duties, covenants, obligations and agreements under the Agreement (iv) to comply with all terms and conditions of the Resolution; and (v) to establish, levy and collect rents, rates and other charges for the products and services provided by its Water System, which rents, rates and other charges shall be at least sufficient (A) to meet the operation and maintenance expenses of such Water System, (B) to produce and maintain Net Revenues at a level not less than 110% of the amount of principal and interest on the Revenue Bond and any other obligations secured by a pledge of the Net Revenues falling due in the same year, (C)to comply with all covenants pertaining thereto contained in, and all other provisions of, any bond resolution, trust indenture or other security agreement, if any, relating to any bonds or other evidences of indebtedness issued orto be issued bythe Participant,(D)to pay the debt service requirements on any bonds, notes or other evidences of indebtedness, whether now outstanding or incurred in the future, secured by such revenues or other receipts and issued to finance improvements to the Water System and to make any other payments required by the laws of the State of Iowa, (E) to generate funds sufficient to fulfill the terms of all other contracts and agreements made by the Participant, including,without limitation,the Agreement and the Revenue Bond and(F)to pay all other amounts payable from or constituting a lien or charge on the operating revenues of its Water System. 4 Section 8. Exclusion of Interest from Gross Income. Unless otherwise agreed to by the Issuer in writing, the Participant covenants and agrees as follows: (a) The Participant shall not take any action or omit to take any action which would result in a loss of the exclusion of the interest on the Bonds from gross income for federal income taxation as that status is governed by Section 103(a) of the Code. (b) The Participant shall not take any action or omit to take any action, which action or omission would cause its Revenue Bond ar the Bonds (assuming solely for this purpose that the proceeds of the Bonds loaned to the Participant represent all of the proceeds of the Bonds)to be "private activity bonds"within the meaning of Section 141(a) of the Code. Accordingly, unless the Participant receives the prior written approval of the Issuer, the Participant shall not (A) permit any of the proceeds of the Bonds loaned to the Participant or the Project financed with such proceeds to be used, either directly or indirectly, in any manner that would constitute "private business use"within the meaning of Section 141(b)(6) of the Code, taking into account for this purpose all such use by persons other than governmental units on an aggregate basis, (B) use, either directly or indirectly, any of the proceeds of the Bonds loaned to the Participant to make or finance loans to persons other than governmental units (as such term is used in Section 141(c) of the Code) ar (C)use, either directly or indirectly, any of the proceeds of the Bonds loaned to the Participant to acquire any "non-governmental output property" within the meaning of Section 141(d)(2) ofthe Code. (c) The Participant shall not directly or indirectly use or permit the use of any proceeds of the Bonds (or amounts replaced with such proceeds) or any other funds ar take any action or omit to take any action, which use or action or omission would (assuming solely far this purpose that the proceeds of the Bonds loaned to the Participant represent all of the proceeds of the Bonds) cause the Bonds to be "arbitrage bonds" within the meaning of Section 148(a) of the Code. (d) The Participant shall not directly or indirectly use or permit the use of any proceeds of the Bonds to pay the principal of or interest on any issue of State or local governmental obligations ("refinancing of indebtedness") unless the Participant shall establish to the satisfaction of the Issuer that such refinancing of indebtedness will not adversely affect the exclusion from gross income of interest on the Bonds for federal income tax purposes and the Participant delivers an opinion to such effect of bond counsel acceptable to the Issuer. (e) The Participant shall not directly or indirectly use or permit the use of any proceeds ofthe Bonds to reimburse the Participant for any portion of the cost ofthe Project unless such cost was paid or incurred by the Participant in anticipation of reimbursement from the proceeds of the Bonds or other State or local governmental borrowing in accordance with the Code, published rulings of the Internal Revenue Service and the Regulations. (� The Participant shall not use the proceeds ofthe Bonds (assuming solely for this purpose that the proceeds of the Bonds loaned to the Participant represent all of the 5 proceeds of the Bonds) in any manner which would cause the Bonds to be "federally guaranteed"within the meaning of Section 149(b)ofthe Code or"hedge bonds"within the meaning of Section 149(g) of the Code. (g) The Participant shall comply with all provisions of the Code relating to the rebate of any profits from arbitrage attributable to the Participant, and shall indemnify and hold the Issuer harmless therefrom. Section 9. Insurance: Audits: Disnosal of Pronertv. The Participant covenants and agrees (a) to maintain insurance on, or to self-insure, the insurable portions of the Water System of a kind and in an amount which normally would be carried by private companies engaged in a similar type of business, (b) to keep proper books and accounts adapted to the Water System, showing the complete and correct entry of all transactions relatingthereto, and to cause said books and accounts to be audited or examined by an independent auditor or the State Auditor(i) at such times and for such periods as may be required by the federal Single Audit Act of 1984, OMB Circular A-133 or State law, and (ii) at such other times and for such other periods as may be requested at any time and from time to time by the Issuer(which requests may require an audit to be performed for a period that would not otherwise be required to be audited under State law), and (c) not to sell, lease or in any manner dispose of the Water System, or any capital part thereof, including any and all ea�tensions and additions which may be made thereto,until the Revenue Bond shall have been paid in full or otherwise discharged as provided in the Resolution; provided, however, that the Participant may dispose of any property which in the judgment of its governing body is no longer useful or profitable to use in connection with the operation ofthe Water System or essential to the continued operation thereof. Section 10. Maintenance of Documents; Access. The Participant agrees to maintain its project accounts in accordance with generally accepted accounting principles ("GAAP'� as issued by the Governmental Accounting Standards Board, including GAAP requirements relating to the reporting of infrastructure assets. The Participant agrees to permit the Issuer or its duly authorized representative access to all files and documents relating to the Project for purposes of conducting audits and reviews in accordance with any of the Regulations. Section 11. Continuing Disclosure. As a means of enabling the Issuer to comply with the "continuing disclosure" requirements set forth in Rule 15c2-12 (the "Rule'� of the Securities and Exchange Commission, the Participant agrees, during the term of the Loan, to provide the Issuer with (i) the comprehensive audit report of the Participant, prepared and certified by an independent auditor ar the State Auditor not later than twelve months after the end of each fiscal year for which the report was prepared and (ii) such other information and operating data as the Issuer may reasonably request from time to time with respect to the Water System, the Project or the Participant. The Participant hereby consents to the inclusion of all or any portion of the foregoing information and materials in a public filing made by the Issuer under the Rule. The Participant agrees to indemnify and hold harmless the Issuer, and its officers, directors, employees and agents from and against any and all claims, damages, losses, liabilities, reasonable costs and expenses 6 whatsoever (including attorney fees) which such indemnified party may incur by reason of or in connection with the disclosure of information permitted under this Section; provided that no such indemnification shall be required for any claims, damages, losses, liabilities, costs or expenses to the ea�tent,but only to the ea�tent, caused bythe willful misconduct or gross negligence ofthe Issuer in the disclosure of such information. Section 12. Events of Default. If any one or more of the following events occur, it is hereby defined as and declared to constitute an "Event of DefaulY'under this Agreement: (a) Failure by the Participant to pay, or cause to be paid, any Loan repayment (including the Servicing Fee) required to be paid under this Agreement when due, which failure shall continue for aperiod offifteen (15) days. (b) Failure by the Participant to make, or cause to be made, any required payments of principal, redemption premium, if any, and interest on any bonds, notes or other obligations of the Participant (other than the Loan and the Revenue Bond), the payment of which are secured by operating revenues of the Water System. (c) Failure by the Participant to observe and perform any duty, covenant, obligation or agreement on its part to be observed or performed under the Agreement or the Resolution, other than the obligation to make Loan repayments, which failure shall continue for a period of thirty (30) days after written notice, specifying such failure and requesting that it be remedied, is given to the Participant by the Issuer, unless the Issuer shall agree in writing to an eatension of such time priar to its expiration or the failure stated in such notice is correctable but cannot be corrected in the applicable period, in which case the Issuer may not unreasonably withhold its consent to an ea�tension of such time up to one hundred twenty (120) days from the delivery of the written notice referred to above if corrective action is commenced by the Participant within the applicable period and diligently pursued until the Event of Default is corrected. Section 13. Remedies on Default. Whenever an Event of Default shall have occurred and be continuing, the Issuer shall have the right to take any action authorized under the Regulations, the Revenue Bond or this Agreement and to take whatever other action at law or equity may appear necessary or desirable to collect the amounts then due and thereafter to become due under the Agreement or to enforce the performance and observance of any duty, covenant, obligation or agreement of the Participant under the Agreement or the Resolution. Section 14. Amendments. This Agreement may not be amended, supplemented or modified except by a writing executed by all of the parties hereto. Section 15. Termination. The Participant understands and agrees that the Loan may be terminated at the option of the Issuer if construction of the Project has not commenced within one year of the date of execution of this Agreement, all as set forth in the Regulations. Section 16. Rule of Construction. This Agreement is executed pursuant to the provisions of Section 384.24A ofthe Code of Iowa and shall be read and construed as conforming to all provisions and requirements of that statute. 7 In the event of any inconsistency or conflict between the terms and conditions of the Revenue Bond and this Agreement ar the Regulations, the parties acknowledge and agree that the terms of this Agreement or the Regulations, as the case may be, shall take precedence over any such terms of the Revenue Bond and shall be controlling, and that the payment of principal and interest on the Loan shall at all times conform to the schedule set forth on Exhibit A, as adjusted, and the Regulations. Section 17. Federal Requirements. The Participant agrees to comply with all applicable federal requirements including, but not limited to, Davis-Bacon wage requirements and the requirements relating to the use of American iron and steel products. Section 18. Renavment of Plannin� and Desian Loan. The Participant entered into an Interim Loan and Disbursement Agreement with the Issuer to provide funds to pay the costs of planning and designing the Project. The Participant agrees to repay the Interim Loan and Disbursement Agreement on the date of this Agreement. Unless the Participant notifies the Issuer that the Participant intends to repay the Interim Loan and Disbursement Agreement from other funds, and the Issuer has received such other funds from the Participant on the date hereof, the Issuer shall be authorized to deduct the full amount due under the Interim Loan and Disbursement Agreement from the proceeds ofthe Loan being made hereunder, and such deduction by the Issuer shall be deemed to be an expenditure by the Participant of the Loan proceeds. 8 IN WITNESS WHEREOF, we have hereunto afFixed our signatures all as of the date first above written. CITY OF DUBUQUE, IOWA By: Mayor Attest: City Clerk [Participant Signature Page to LDA] IN WITNESS WHEREOF, we have hereunto afFixed our signatures all as of the date first above written. IOWA FINANCE AUTHORITY By: Its: Executive Director [IFA Signature Page to LDA] EXHIBIT A ESTIMATED DISBURSEMENTS AND DEBT SERVICE REPAYMENT SCHEDULE oiwsiazi�ioazz-i9� A-1 TAX EXEMPTION CERTIFICATE THE CITY OF DUBUQUE, IOWA THIS TAX EXEMPTION CERTIFICATE is made and entered into on August 9, 2019, by the City of Dubuque, State of Iowa(the "Issuer"). INTRODUCTION This Certificate is executed and delivered in connection with the issuance by the Issuer of its $4,400,000 Water Revenue Capital Loan Note, Series 2019 (the "Bonds"). The Bonds are issued pursuant to the provisions of the Resolution of the Issuer authorizing the issuance of the Bonds. Such Resolution provides that the covenants contained in this Certificate constitute a part of the Issuer's contract with the owners of the Bonds. The Issuer recognizes that under the Code (as defined below)the tax-exempt status of the interest received by the owners of the Bonds is dependent upon, among other things, the facts, circumstances, and reasonable expectations of the Issuer as to future facts not in existence at this time, as well as the observance of certain covenants in the future. The Issuer covenants that it will take such action with respect to the Bonds as may be required by the Code, and pertinent legal regulations issued thereunder in order to establish and maintain the tax-exempt status of the Bonds, including the observance of all specific covenants contained in the Resolution and this Certificate. ARTICLE I DEFINITIONS The following terms as used in this Certificate shall have the meanings set forth below. The terms defined in the Resolution shall retain the meanings set forth therein when used in this Certificate. Other terms used in this Certificate shall have the meanings set forth in the Code or in the Regulations. "Annual Debt Service" means the principal of and interest on the Bonds scheduled to be paid during a given Bond Year. "Bonds" means the $4,400,000 aggregate principal amount of a Water Revenue Capital Loan Note of the Issuer issued in registered form pursuant to the Resolution. "Bond Counsel" means Ahlers & Cooney, P.C., Des Moines, Iowa, or an attorney at law or a firm of attorneys of nationally recognized standing in matters pertaining to the tax-exempt status of interest on obligations issued by states and their political subdivisions, duly admitted to the practice of law before the highest court of any State of the United States of America. - 1 - "Bond Fund" means the Sinking Fund described in the Resolution. "Bond Year", as defined in Regulation 1.148-1(b), means a one-year period beginning on the day after expiration of the preceding Bond Year. The first Bond Year shall be the one-year or shorter period beginning on the Closing Date and ending on a principal or interest payment date, unless the Issuer selects another date. "Bond Yield" means that discount rate which produces an amount equal to the Issue Price of the Bonds when used in computing the present value of all payments of principal and interest to be paid on the Bonds, using semiannual compounding on a 360-day year as computed under Regulation 1.148-4. "Certificate" means this Tax Exemption Certificate. "Closing" means the delivery of the Bonds in exchange for the agreed upon purchase price. "Closing Date" means the date of Closing. "Code" means the Internal Revenue Code of 1986, as amended, and any statutes which replace or supplementthe Internal Revenue Code of 1986. "Computation Date" means each five-year period from the Closing Date through the last day of the fifth and each succeeding fifth Bond Year. "Excess Earnings" means the amount earned on all Nonpurpose Investments minus the amount which would have been earned if such Nonpurpose Investments were invested at a rate equal to the Bond Yield, plus any income attributable to such excess. "Final Bond Retirement Date" means the date on which the Bonds are actually paid in full. "Governmental Obligations" means direct general obligations of, or obligations the timely payment of the principal of and interest on which is unconditionally guaranteed by the United States. "Gross Proceeds", as defined in Regulation 1.148-1(b), means any Proceeds of the Bonds and any replacement proceeds (as defined in Regulation 1.148-1(c)) ofthe Bonds. "Gross Proceeds Funds" means the Project Fund and any other fund or account held for the benefit of the owners of the Bonds or containing Gross Proceeds of the Bonds except the Bond Fund and the Rebate Fund. "Issue Price", as defined in Regulation 1.148-1(b), means price paid by the Purchasers of the Bonds. The Purchasers have certified the Issue Price to be $4,400,000. - 2 - "Issuer" means the City of Dubuque, State of Iowa. "Minor Portion of the Bonds", as defined in Regulation 1.148-2(g), means the lesser of five (5)percent of Proceeds or $100,000. The Minor Portion of the Bonds is computed to be $100,000. "Nonpurpose Investments" means any investment property which is acquired with Gross Proceeds and is not acquired to carry out the governmental purpose of the Bonds, and may include but is not limited to U.S. Treasury bonds, corporate bonds, or certificates of deposit. "Proceeds", as defined in Regulation 1.148-1(b), means Sale Proceeds, investment proceeds and transferred proceeds of the Bonds. "Project" means the acquisition, construction, reconstruction, ea�tending, remodeling, improving, repairing and equipping all or part of the Municipal Water System, including those costs associated with the Roosevelt Street water tower and water distribution improvements project and the Eagle Point water treatment plant and water distribution improvements project; and refunding the Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017, dated September 22, 2017, as more fully described in the Resolution. "Project Fund" means the fund established in the Resolution. "Purchaser" means the Iowa Finance Authority, Des Moines, Iowa, constituting the initial purchaser of the Bonds from the Issuer. "Rebate Amount" means the amount computed as described in this Certificate. "Rebate Fund" means the fund to be created, if necessary, pursuant to this Certificate. "Rebate Payment Date" means a date chosen by the Issuer which is not more than 60 days following each Computation Date or the Final Bond Retirement Date. "Refunded SRF Planning and Design Note" means $444,162.62 ofthe $475,000 Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017 dated September 22, 2017. "Regulations" means the Income Tax Regulations, amendments and successor provisions promulgated by the Department of the Treasury under Sections 103, 148 and 149 of the Code, or other Sections of the Code relating to "arbitrage bonds", including without limitation Regulations 1.148-1 through 1.148-11, 1.149(b)-1, 1.149-d(1), 1.150-1 and 1.150-2. "Replacement Proceeds" include, but are not limited to, sinking funds, amounts that are pledged as security for an issue, and amounts that are replaced because of a sufficiently direct nexus to a governmental purpose of an issue. - 3 - "Resolution" means the resolution of the Issuer adopted on July 15, 2019 authorizing the issuance ofthe Bonds. "Sale Proceeds", as defined in Regulation 1.148-1(b), means any amounts actually or constructively received from the sale of the Bonds, including amounts used to pay underwriter's discount or compensation and accrued interest other than pre-issuance accrued interest. "Sinking Fund" means the Bond Fund. "Tax Exempt Obligations" means bonds or other obligations the interest on which is excludable from the gross income ofthe owners thereofunder Section 103 ofthe Code and include certain regulated investment companies, stock in tax-exempt mutual funds and demand deposit SLGS. "Taxable Obligations" means all investment property, obligations or securities other than Tax Exempt Obligations. "Verification Certificate" means the certificate attached to this Certificate as Exhibit A, establishing that the Purchaser will not reoffer or sell the Bonds to the public. ARTICLE II SPECIFIC CERTIFICATIONS, REPRESENTATIONS AND AGREEMENTS The Issuer hereby certifies, represents and agrees as follows: Section 2.1 Authoritv to Certifv and Exnectations (a) The undersigned officer of the Issuer along with other officers of the Issuer, are charged with the responsibility of issuing the Bonds. (b) This Certificate is being executed and delivered in part far the purposes specified in Section 1.148-2(b)(2) ofthe Regulations and is intended (among other purposes)to establish reasonable expectations of the Issuer at this time. (c) The Issuer has not been notified of any disqualification or proposed disqualification of it by the Commissioner of the Internal Revenue Service as a bond issuer which may certify bond issues under Section 1.148-2(b)(2) ofthe Regulations. (d) The certifications, representations and agreements set forth in this Article II are made on the basis of the facts, estimates and circumstances in existence on the date hereof, - 4 - including the following (1) with respect to amounts expected to be received from delivery of the Bonds, amounts actually received, (2)with respect to payments of amounts into various funds or accounts, review of the authorizations or directions for such payments made by the Issuer pursuant to the Resolution and this Certificate, (3) with respect to the Issue Price,the certifications of the Purchaser as set forth in the Verification Certificate, (4)with respect to expenditure ofthe Proceeds ofthe Bonds, actual expenditures and reasonable expectations ofthe Issuer as to when the Proceeds will be spent for purposes of the Project and (5)with respect to Bond Yield, review of the Verification Certificate. The Issuer has no reason to believe such facts, estimates or circumstances are untrue or incomplete in any material way. (e) To the best of the knowledge and belief of the undersigned officer of the Issuer, there are no facts, estimates or circumstances that would materially change the representations, certifications or agreements set forth in this Certificate, and the expectations herein set out are reasonable. (� No arrangement exists under which the payment of principal or interest on the Bonds would be directly or indirectly guaranteed by the United States or any agency or instrumentality thereof. (g) After the expiration of any applicable temporary periods, and excluding investments in a bona fide debt service fund or reserve fund, not more than five percent(5%) of the Proceeds of the Bonds will be (a)used to make loans which are guaranteed by the United States or any agency or instrumentality thereof, or (b) invested in federally insured deposits or accounts. (h) The Issuer will file with the Internal Revenue Service in a timely fashion Form 8038-G, Information Return for Tax-Exempt Governmental Obligations, with respect to the Bonds and such other reports required to comply with the Code and applicable Regulations. (i) The Issuer will take no action which would cause the Bonds to become "private activity bonds" as defined in Section 141(a) ofthe Code, including any use ofthe Project by any person other than a governmental unit if such use will be as other than a member of the general public. None of the Proceeds of the Bonds will be used directly or indirectly to make or finance loans to any person other than a governmental unit. (j) The Issuer will make no change in the nature or purpose of the Project except as provided in Section 6.1 hereof. (k) Except as provided in Section 6.1 hereof, the Issuer will not establish any sinking fund, bond fund, reserve fund, debt service fund or other fund reasonably expected to be used to pay debt service on the Bonds (other than the Bond Fund), exercise its option to redeem Bonds prior to maturity or effect a refunding of the Bonds. - 5 - (1) No bonds or other obligations of the Issuer(1) were sold in the 15 days preceding the date of sale of the Bonds, (2)were sold or will be sold within the 15 days after the date of sale of the Bonds, (3)have been delivered in the past 15 days or (4) will be delivered in the neat 15 days pursuant to a common plan of financing for the issuance of the Bonds and payable out of substantially the same source of revenues. (m) None of the Proceeds of the Bonds will be used directly or indirectly to replace funds of the Issuer used directly or indirectly to acquire obligations having a yield higher than the Bond Yield. (n) No portion of the Bonds will be issued for the purpose of investing such portion at a higher yield than the Bond Yield. (o) The Issuer does not expect that the Proceeds of the Bonds will be used in a manner that would cause them to be "arbitrage bonds" as defined in Section 148(a) of the Code. The Issuer does not expect that the Proceeds of the Bonds will be used in a manner that would cause the interest on the Bonds to be includable in the gross income of the owners of the Bonds under the Code. The Issuer will not intentionally use any portion of the Proceeds to acquire higher yielding investments. (p) The Issuer will not use the Proceeds of the Bonds to exploit the difference between tax-exempt and taxable interest rates to obtain a material financial advantage. (q) The Issuer has not issued more Bonds, issued the Bonds earlier, or allowed the Bonds to remain outstanding longer than is reasonably necessary to accomplish the governmental purposes of the Bonds. (r) The Issuer has not employed a device in connection with the issuance of the Bonds to obtain a material financial advantage (based on arbitrage) apart from savings attributable to lower interest rates. The Issuer will not realize any material financial advantage (based on arbitrage or otherwise) in connection with the issuance of the Bonds, or in connection with any transaction or series of transactions connected with the issuance of the Bonds, apart from savings attributable to lower interest rates. (s) The Bonds will not be Hedge Bonds as described in Section 149(g)(3) ofthe Code because the Issuer reasonably expects that it will meet the Expenditure Test set forth in Section 2.5(b) hereof and that not more than 50% of the Proceeds will be invested in Nonpurpose Investments having a substantially guaranteed yield for four or more years. Section 2.2 Receipts and Expenditures of Sale Proceeds Sale Proceeds received at Closing are expected to be deposited and expended as follows: - 6 - (a) $34,000 representing costs of issuing the Bonds and the Initiation Fee for the Loan will be used within six months of the Closing Date to pay the costs of issuance of the Bonds (with any excess remaining on deposit in the Project Fund); (b) $3,921,837.38 will be available to be deposited into the Project Fund and will be used together with earnings thereon to pay the costs ofthe Project and will not exceed the amount necessary to accomplish the governmental purposes of the Bonds; and (c) $444,162.62 will be used together with earnings thereon to pay the principal amount drawn on the Refunded SRF Planning and Design Note, which will be redeemed on August 9, 2019. Section 2.3 Pumose of Bonds The Issuer is issuing the Bonds to pay costs of the acquisition, construction, reconstruction, eatending, remodeling, improving, repairing and equipping all or part of the Municipal Water System, including those costs associated with the Roosevelt Street water tower and water distribution improvements project and the Eagle Point water treatment plant and water distribution improvements project; and refundingthe Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017, dated September 22, 2017, in order to implement long- term financing for the Proj ect. Section 2.4 Facts Supporting Tax-Exemption Classification The Bonds are considered to be governmental bonds, not subject to the provisions of the alternate minimum tax. Proceeds of the Bonds will be used for the purpose of paying costs of the Project. All of the financed facilities are owned by the City and are expected to be used by the public generally, including commercial and industrial users. There are no contractual arrangements or agreements between the City and any commercial or industrial user ofthe Water Utility, and there are no other lease, management contract or other similar arrangements with respectto the Water Utility. Commercial or industrial users ofthe Water Utility may be or become subject to different rates or charges than those imposed on residential customers, depending on the volume of the water they purchase. All such charges, however, are or will be imposed by viriue of City ordinances applicable to all entities meeting the standards set forth therein. No other charges or payments will be imposed or paid to the City by any contributing industry for water services or Project-related construction and acquisition beyond those mandated by ordinance for certain classes of users. No amount of Proceeds of the Bonds ar the Refunded SRF Planning and Design Note is to be used or were directly or indirectly to make or finance loans to persons other than governmental units. - 7 - Section 2.5 Facts Sunnortine Temnorary Periods for Proceeds (a) Time Test. Not later than six months after the Closing Date,the Issuer will incur a substantial binding obligation to a third party to expend at least 5% of the net Sale Proceeds of the Bonds. (b) Exnenditure Test. Not less than 85% of the net Sale Proceeds will be expended for Project costs, including the reimbursement of other funds expended to date, within a three-year temporary period from the Closing Date. (c) Due Dili�ence Test. Not later than six months after Closing, work on the Project will have commenced and will proceed with due diligence to completion. (d) Proceeds of the Bonds representing less than six months accrued interest on the Bonds will be spent within six months of this date to pay interest on the Bonds, and will be invested without restriction as to yield for a temporary period not in excess of six months. Section 2.6 Resolution Funds at Restricted or Unrestricted Yield (a) Proceeds of the Bonds will be held and accounted for in the manner provided in the Resolution. The Issuer has not and does not expect to create or establish any other bond fund, reserve fund, or similar fund or account far the Bonds. The Issuer has not and will not pledge any moneys ar Taxable Obligations in order to pay debt service on the Bonds or restrict the use of such moneys or Taxable Obligations so as to give reasonable assurances of their availability for such purposes. (b) Any monies which are invested beyond a temporary period are expected to constitute less than a major portion of the Bonds or to be restricted for investment at a yield not greater than one-eighth of one percent above the Bond Yield. (c) The Issuer has established and will use the Bond Fund primarily to achieve a proper matching of revenues and debt service within each Bond Year and the Issuer will apply moneys deposited into the Bond Fund to pay the principal of and interest on the Bonds. Such Fund will be depleted at least once each Bond Year except for a reasonable carryover amount. The carryover amount will not exceed the greater of(1) one year's earnings on the Bond Fund or (2) one-twelfth of Annual Debt Service. The Issuer will spend moneys deposited from time to time into such fund within 13 months after the date of deposit. Revenues, intended to be used to pay debt service on the Bonds, will be deposited into the Bond Fund as set forth in the Resolution. The Issuer will spend interest earned on moneys in such fund not more than 12 months after receipt. Accordingly, the Issuer will treat the Bond Fund as a bona fide debt service fund as defined in Regulation 1.148-1(b). - g - Investment of amounts on deposit in the Bond Fund will not be subj ect to arbitrage rebate requirements as the Bonds meet the safe harbor set forth in Regulation 1.148-3(k), because the average annual debt service on the Bonds will not exceed $2,500,000. (d) The Minor Portion of the Bonds will be invested without regard to yield. Section 2.7 Pertainin�to Yields (a) The purchase price of all Taxable Obligations to which restrictions apply under this Certificate as to investment yield or rebate of Excess Earnings, if any, has been and shall be calculated using(i)the price taking into account discount, premium and accrued interest, as applicable, actually paid or(ii)the fair market value if less than the price actually paid and if such Taxable Obligations were not purchased directly from the United States Treasury. The Issuer will acquire all such Taxable Obligations directly from the United States Treasury or in an arm's length transaction without regard to any amounts paid to reduce the yield on such Taxable Obligations. The Issuer will not pay or permit the payment of any amounts (other than to the United States)to reduce the yield on any Taxable Obligations. Obligations pledged to the payment of debt service on the Bonds, or deposited into any reserve fund after they have been acquired by the Issuer will be treated as though they were acquired for their fair market value on the date of such pledge or deposit. Obligations on deposit in any reserve fund on the Closing Date shall be treated as if acquired for their fair market value on the Closing Date. (b) Qualified guarantees have not been used in computing yield. (c) The Bond Yield has been computed as not less than 1.750058%percent. This Bond Yield has been computed on the basis of a purchase price for the Bonds equal to the Issue Price. ARTICLE III REBATE Section 3.1 Records Sale Proceeds of the Bonds will be held and accounted for in the manner provided in the Resolution. The Issuer will maintain adequate records for funds created by the Resolution and this Certificate including all deposits, withdrawals, transfers from,transfers to, investments, reinvestments, sales, purchases, redemptions, liquidations and use of money or obligations until six years after the Final Bond Retirement Date. Section 3.2 Rebate Fund - 9 - (a) In the Resolution,the Issuer has covenanted to pay to the United States the Rebate Amount, an amount equal to the Excess Earnings on the Gross Proceeds Funds, if any, at the times and in the manner required or permitted and subject to stated special rules and allowable exceptions or exemptions. (b) The Issuer may establish a fund pursuant to the Resolution and this Certificate which is herein referred to as the Rebate Fund. The Issuer will invest and expend amounts on deposit in the Rebate Fund in accordance with this Certificate. (c) Moneys in the Rebate Fund shall be held by the Issuer or its designee and, subject to Sections 3.4, 3.5 and 6.1 hereof, shall be held for future payment to the United States as contemplated under the provisions of this Certificate and shall not constitute part of the trust estate held far the benefit of the owners of the Bonds ar the Issuer. (d) The Issuer will pay to the United States from legally available money of the Issuer (whether or not such available money is on deposit in any fund or account related to the Bonds) any amount which is required to be paid to the United States. Section 3.3 Exceptions to Rebate The Issuer reasonably expects that the Bonds are eligible for one or more exemptions from the arbitrage rebate rules set forth in the Treasury Regulations. If the Bonds are ineligible, or become ineligible,for an exemption to the arbitrage rebate rules, the Issuer will comply with the provisions of Article III hereo£ A description of the applicable rebate exemption(s) is as follows: • Eighteen-Month Exemption The Gross Proceeds of the Bonds are expected to be expended for the governmental purposes for which the Bonds were issued in accordance with the following schedule: 1) 15 percent spent within six months of the Closing Date; 2) 60 percent spent within one year of the Closing Date; 3) 100 percent spent within eighteen months of the Closing Date (subject to 5 percent retainage for not more than one year). In any event, the Issuer expects that the 5%reasonable retainage will be spent within 30 months of the Closing Date. For purposes of determining compliance with the six-month and twelve- month spending periods, the amount of investment earnings included shall be based on the Issuer's reasonable expectations that the average annual interest rate on investments will be not more than 6.0%. For purposes of determining compliance with the eighteen-month spending period, the amount of investment earnings included shall be based on actual earnings. If the Issuer fails to meet the foregoing expenditure schedule, the Issuer shall comply with the arbitrage rebate requirements ofthe Code. - 10 - • Election to Treat as Construction Bonds. The Bonds qualify as a "construction issue" as defined in Section 148(�(4)(C)(vi) of the Code. The Issuer reasonably expects that more than 75 percent of the "available construction proceeds" ("ACP") of the Bonds, as defined in Section 148(�(4)(C)(vi) of the Code, will be used for construction expenditures and that not less than the following percentages of the available construction proceeds will be spent within the following periods: 1) 10 percent spent within six months of the Closing Date 2) 45 percent spent within one year of the Closing Date 3) 75 percent spent within eighteen months of the Closing Date 4) 100 percent spent within two years of the Closing Date (subject to 5 percent retainage for not more than one year) In any event, the Issuer expects that the 5%reasonable retainage will be spent within a three-year period beginning on the Closing Date. A failure to spend an amount that does not exceed the lesser of(i) 3% of the issue price or(ii) $250,000, is disregarded if the Issuer exercises due diligence to complete the Project. • Election with respect to future earnings Pursuant to Section 1.148-7(�(2) of the Regulations, the Issuer elects to use actual investment earnings of the ACP in determining compliance with the above schedule. If the Issuer fails to meet the foregoing expenditure schedule,the Issuer shall comply with the arbitrage rebate requirements of the Code. Section 3.4 Calculation of Rebate Amount (a) As soon after each Computation Date as practicable, the Issuer shall, if necessary, calculate and determine the Excess Earnings on the Gross Proceeds Funds (the "Rebate Amount"). All calculations and determinations with respect to the Rebate Amount will be made on the basis of actual facts as of the Computation Date and reasonable expectations as to future events. (b) If the Rebate Amount exceeds the amount currently on deposit in the Rebate Fund, the Issuer may deposit an amount in the Rebate Fund such that the balance in the Rebate Fund after such deposit equals the Rebate Amount. If the amount in the Rebate Fund exceeds the Rebate Amount, the Issuer may withdraw such excess amount provided that such withdrawal can be made from amounts originally transferred to the Rebate Fund and not from earnings thereon, which may not be transferred, and only if such withdrawal may be made without liquidating investments at a loss. Section 3.5 Rebate Requirements and the Bond Fund - 11 - It is expected that the Bond Fund described in the Resolution and Section 2.7(b) of this Certificate will be treated as a bona fide debt service fund as defined in Regulation 1.148-1(b). As such, any amount earned during a Bond Year on the Bond Fund and amounts earned on such amounts, if allocated to the Bond Fund, will not be taken into account in calculating the Rebate Amount ifthe annual gross earnings on the Bond Fund for such Bond Year are less than $100,000 or if average annual debt service will not exceed $2,500,000. However, should annual gross earnings exceed $100,000 or should the Bond Fund cease to be treated as a bona fide debt service fund, the Bond Fund will become subject to the rebate requirements set forth in Section 3.4 hereof. Section 3.6 Investment ofthe Rebate Fund (a) Immediately upon a transfer to the Rebate Fund, the Issuer may invest all amounts in the Rebate Fund not already invested and held in the Rebate Fund, to the eatent possible, in (1) SLGS, such investments to be made at a yield of not more than one-eighth of one percent above the Bond Yield, (2) Tax Exempt Obligations, (3) direct obligations of the United States or(4) certificates of deposit of any bank or savings and loan association. All investments in the Rebate Fund shall be made to mature not later than the neat Rebate Payment Date. (b) If the Issuer invests in SLGS, the Issuer shall file timely subscription forms for such securities (if required). To the ea�tent possible, amounts received from maturing SLGS shall be reinvested immediately in zero yield SLGS maturing on or before the neat Rebate Payment Date. Section 3.7 Pavmentto the United States (a) On each Rebate Payment Date, the Issuer will pay to the United States at least ninety percent(90%) of the Rebate Amount less a computation credit of$1,000 per Bond Year for which the payment is made. (b) The Issuer will pay to the United States not later than siaty(60) days after the Final Bond Retirement Date all the rebatable arbitrage as of such date and any income attributable to such rebatable arbitrage as described in Regulation 1.148-3(�(2). (c) If necessary, on each Rebate Payment Date, the Issuer will mail a check to the Internal Revenue Service Center, Ogden, UT 84201. Each payment shall be accompanied by a copy of Form 8038-T, Arbitrage Rebate, filed with respect to the Bonds or other information reporting form as is required to comply with the Code and applicable Regulations. Section 3.8 Records (a) The Issuer will keep and retain adequate records with respect to the Bonds, the Gross Proceeds Funds, the Bond Fund and the Rebate Fund until six years after the Final Bond - 12 - Retirement Date. Such records shall include descriptions of all calculations of amounts transferred to the Rebate Fund, if any, and descriptions of all calculations of amounts paid to the United States as required by this Certificate. Such records will also show all amounts earned on moneys invested in such funds, and the actual dates and amounts of all principal, interest and redemption premiums (if any) paid on the Bonds. (b) Records relating to the investments in such Funds shall completely describe all transfers, deposits, disbursements and earnings including: (i) a complete list of all investments and reinvestments of amounts in each such Fund including, if applicable, purchase price, purchase date, type of security, accrued interest paid, interest rate, dated date, principal amount, date of maturity, interest payment dates, date of liquidation, receipt upon liquidation, market value of such investment on the Final Bond Retirement Date if held by the Issuer on the Final Bond Retirement Date, and market value of the investment on the date pledged to the payment of the Bonds, or the Closing Date if different from the purchase date. (ii) the amount and source of each payment to, and the amount, purpose and payee of each payment from, each such Fund. Section 3.9 Additional Payments The Issuer hereby agrees to pay to the United States from legally available money of the Issuer (whether or not such available money is on deposit in any fund or account related to the Bonds) any amount which is required to be paid to the United States, but which is not available in a fund related to the Bonds for transfer to the Rebate Fund or payment to the United States. ARTICLE IV INVESTMENT RESTRICTIONS Section 4.1 Avoidance of Prohibited Payments The Issuer will not enter into any transaction that reduces the amount required to be deposited into the Rebate Fund or paid to the United States because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction had been at arm's length and had the Bond Yield not been relevant to either party. The Issuer will not invest or direct the investment of any funds in a manner which reduces an amount required to be paid to the United States because such transaction results in a small profit or larger loss than would have resulted if the transaction had been at arm's length and had the Bond Yield not been relevant to the Issuer. In particular, notwithstanding anything to the contrary contained herein or in the Resolution, the Issuer will not invest or direct the investment of any funds in a manner which would violate any provision ofthis Article IV. - 13 - Section 4.2 Market Price Requirement (a) The Issuer will not purchase or direct the purchase of Taxable Obligations for more than the then available market price for such Taxable Obligations. The Issuer will not sell, liquidate or direct the sale or liquidation of Taxable Obligations for less than the then available market price. (b) For purposes of this Certificate, United States Treasury obligations purchased directly from the United States Treasury will be deemed to be purchased at the market price. Section 4.3 Investment in Certificates of Denosit (a) Notwithstanding anything to the contrary contained herein or in the Resolution, the Issuer will invest or direct the investment of funds on deposit in the Gross Proceeds Fund, the Bond Fund, and the Rebate Fund, in a certificate of deposit of a bank or savings bank which is permitted by law and by the Resolution only if(1)the price at which such certificate of deposit is purchased or sold is the bona fide bid price quoted by a dealer who maintains an active secondary market in certificates of deposit of the same type or(2) if there is no active secondary market in such certificates of deposit,the certificate of deposit must have a yield (A) as high or higher than the yield on comparable obligations traded on an active secondary market, as certified by a dealer who maintains such a market, and (B) as high or higher than the yield available on comparable obligations ofthe United States Treasury. (b) The certificate of deposit described in part 2(A) of paragraph 4.3(a) above must be executed by a dealer who maintains an active secondary market in comparable certificates of deposit and must be based on actual trades adjusted to reflect the size and term of that certificate of deposit and the stability and reputation of the bank or savings bank issuing the certificate of deposit. Section 4.4 Investment Pursuant to Investment Contracts and Agreements The Issuer will invest or direct the investment of funds on deposit in the Gross Proceeds Funds, the Bond Fund, and the Rebate Fund pursuant to an investment contract(including a repurchase agreement) only if all of the following requirements are satisfied: (a) The Issuer makes a bona fide solicitation for the purchase of the investment. A bona fide solicitation is a solicitation that satisfies all of the following requirements: (1) The bid specifications are in writing and are timely forwarded to potential providers. - 14 - (2) The bid specifications include all material terms of the bid. A term is material if it may directly or indirectly affect the yield or the cost of the investment. (3) The bid specifications include a statement notifying potential providers that submission of a bid is a representation that the potential provider did not consult with any other potential provider about its bid,that the bid was determined without regard to any other formal or informal agreement that the potential provider has with the issuer or any other person (whether or not in connection with the Bonds), and that the bid is not being submitted solely as a courtesy to the issuer or any other person for purposes of satisfying the requirements of paragraph (d)(�(iii)(B)(1) or(2) of section 1.148-5 ofthe Regulations. (4) The terms of the bid specifications are commercially reasonable. A term is commercially reasonable if there is a legitimate business purpose for the term other than to increase the purchase price or reduce the yield of the investment. (5) For purchases of guaranteed investment contracts only, the terms of the solicitation take into account the Issuer's reasonably expected deposit and drawdown schedule for the amounts to be invested. (6) All potential providers have an equal opporiunity to bid and no potential provider is given the opporiunity to review other bids (i.e., a last look) before providing a bid. (7) At least three reasonably competitive providers are solicited for bids. A reasonably competitive provider is a provider that has an established industry reputation as a competitive provider of the type of investments being purchased. (b) The bids received by the Issuer meet all of the following requirements: (1) The Issuer receives at least three bids from providers that the Issuer solicited under a bona fide solicitation meeting the requirements of paragraph (d)(�(iii)(A) of section 1.148-5 of the Regulations and that do not have a material financial interest in the issue. A lead underwriter in a negotiated underwriting transaction is deemed to have a material financial interest in the issue until 15 days after the issue date of the issue. In addition, any entity acting as a financial advisor with respect to the purchase of the investment at the time the bid specifications are forwarded to potential providers has a material financial interest in the issue. A provider that is a related party to a provider that has a material financial interest in the issue is deemed to have a material financial interest in the issue. (2) At least one of the three bids described in paragraph (d)(6)(iii)(B)(1) of section 1.148-5 of the Regulations is from a reasonably competitive provider, - 15 - within the meaning of paragraph (d)(6)(iii)(A)(7) of section 1.148-5 of the Regulations. (3) If the Issuer uses an agent to conduct the bidding process, the agent did not bid to provide the investment. (c) The winning bid meets the following requirements: (1) Guaranteed investment contracts. If the investment is a guaranteed investment contract,the winning bid is the highest yielding bona fide bid (determined net of any broker's fees). (2) Other investments. If the investment is not a guaranteed investment contract, the winning bid is the lowest cost bona fide bid (including any broker's fees). (d) The provider of the investments or the obligor on the guaranteed investment contract certifies the administrative costs that it pays (or expects to pay, if any)to third parties in connection with supplying the investment. (e) The Issuer will retain the following records with the bond documents until three years after the last outstanding bond is redeemed: (1) For purchases of guaranteed investment contracts, a copy of the contract, and for purchases of investments other than guaranteed investment contracts, the purchase agreement or confirmation. (2) The receipt or other record of the amount actually paid by the Issuer for the investments, including a record of any administrative costs paid by the Issuer, and the certification under paragraph (d)(6)(iii)(D) of section 1.148-5 of the Regulations. (3) For each bid that is submitted, the name of the person and entity submitting the bid,the time and date of the bid, and the bid results. (4) The bid solicitation form and, if the terms of the purchase agreement or the guaranteed investment contract deviated from the bid solicitation form or a submitted bid is modified, a brief statement explaining the deviation and stating the purpose for the deviation. (5) For purchases of investments other than guaranteed investment contracts, the cost of the most efficient portfolio of State and Local Government Series Securities, determined at the time that the bids were required to be submitted pursuant to the terms of the bid specifications. Section 4.5 Records - 16 - The Issuer will maintain records of all purchases, sales, liquidations, investments, reinvestments, redemptions, disbursements, deposits, and transfers of amounts on deposit. Section 4.6 Investments to be Le�al All investments required to be made pursuant to this Certificate shall be made to the ea�tent permitted by law. In the event that any such investment is determined to be ultra vires, it shall be liquidated and the proceeds thereof shall be invested in a legal investment, provided that priar to reinvesting such proceeds, the Issuer shall obtain an opinion of Bond Counsel to the effect that such reinvestment will not cause the Bonds to become arbitrage bonds under Sections 103, 148, 149, or any other applicable provision of the Code. ARTICLE V GENERAL COVENANTS The Issuer hereby covenants to perform all acts within its power necessary to ensure that the reasonable expectations set forth in Article II hereof will be realized. The Issuer reasonably expects to comply with all covenants contained in this Certificate. ARTICLE VI AMENDMENTS AND ADDITIONAL AGREEMENTS Section 6.1 Oninion of Bond Counsel: Amendments The various provisions of this Certificate need not be observed and this Certificate may be amended or supplemented at any time by the Issuer if the Issuer receives an opinion or opinions of Bond Counsel that the failure to comply with such provisions will not cause any of the Bonds to become "arbitrage bonds" under the Code and that the terms of such amendment or supplement will not cause any of the Bonds to become "arbitrage bonds" under the Code, or otherwise cause interest on any of the Bonds to become includable in gross income for federal income tax purposes. Section 6.2 Additional Covenants. Aereements The Issuer hereby covenants to make, execute and enter into (and to take such actions, if any, as may be necessary to enable it to do so) such agreements as may be necessary to comply with any changes in law or regulations in order to preserve the tax-exempt status of the Bonds to the ea�tent that it may lawfully do so. The Issuer further covenants (1)to impose such limitations on the investment or use of moneys or investments related to the Bonds, (2)to make such payments to the United States Treasury, (3)to maintain such records, (4)to perform such - 17 - calculations, and (5)to perform such other lawful acts as may be necessary to preserve the tax- exempt status of the Bonds. Section 6.3 Amendments Except as otherwise provided in Section 6.1 hereof, all the rights, powers, duties and obligations of the Issuer shall be irrevocable and binding upon the Issuer and shall not be subject to amendment or modification by the Issuer. ARTICLE VII FURTHER CERTIFICATIONS WITH RESPECT TO REFUNDING BONDS (a) Property financed with the Proceeds of the Refunded SRF Planning and Design Note will not be sold or disposed of, in whole or in part, prior to the last maturity date of either the obligations or the last maturity of the Bonds. (b) All of the Proceeds of the Refunded SRF Planning and Design Note were used to provide facilities used in the regular operations of the Issuer and neither the facilities nor the output thereof have been or are expected to be used in the trade or business of any person other than the Issuer. (c) Reimbursement Allocations and Original Expenditures, if any, reimbursed from proceeds of the Refunded SRF Planning and Design Note complied with the Reimbursement Regulations in effect at the time of issuance of the Refunded SRF Planning and Design Note. (d) The Proceeds of the Refunding Bonds will be used for a current refunding and the Refunding Bonds are issued not more than 90 days before the last expenditure of any Proceeds of the Refunding Bonds for payment of debt service on the Refunded SRF Planning and Design Note. The Proceeds of the Refunding Bonds will be invested in materially higher yield acquired obligations for a temporary period of not to exceed 90 days. - 18 - IN WITNESS WHEREOF, the Issuer has caused this Certificate to be executed by its duly authorized officer, all as of the day first above written. Director of Finance & Budget, City of Dubuque, State of Iowa (SEAL) - 19 - EXHIBIT A VERIFICATION CERTIFICATE OF THE PURCHASER The undersigned the Executive Director of the Iowa Finance Authority(the "Purchaser"), hereby certifies as follows: 1. The Purchaser and the City of Dubuque, Iowa(the "Issuer"), have entered into a Loan and Disbursement Agreement(the "Agreement"), providing for the purchase of a $4,400,000 Water Revenue Capital Loan Note ofthe City dated as ofthe date of delivery(the "Notes"). 2. The Agreement is in full force and effect and has not been repealed, rescinded or amended. 3. The Purchaser hereby confirms that the Notes were purchased at par and will not be reoffered to the public, the terms of purchase being as follows: Price (% of par) (do not Principal Principal include Amount Amount Interest accrued Issued Sold Rate interest) $4,400,000 None 1.75% 100% IN WITNESS WHEREOF, the Purchaser has caused this Verification Certificate to be executed by its duly authorized officer this day of , 2019. IOWA FINANCE AUTHORITY By: Its: Executive Director 01605163-1\10422-197 Ahlers&Cooney, P.G. � �I !� L�F2� �� Q N E Y Attorneys at Law 100 Court Avenue, Suite 600 A T"8" f7 R �l E Y" � Des Moines, lowa 50309-2231 Phone: 515-243-7611 Fax: 515-243-2149 www.ahlerslaw.com Kristin B. Coaper 515.246.0330 kcooper@ahlerslaw.com JLlly 2, 2019 VIA EMAIL AND �GULAR MAIL Ms. Jemly Larson . Director of Finance & Budget Clty Of�UbL1C�Ll0 50 West 13th Street Dubuque, Iowa 52001 RE: Dubuque, Iowa - $4,400,000 Water Revenue Capital Loan Notes, Series 2019 (Iowa Drinlcing Water Facilities Financulg Prograin) (Roosevelt/Eagle Point Pi•ojects) Dear Jemly: With this letter I am enclosing a resohition approving and authorizing the form of Loan and Disbnrsement Agreeinent and authorizing the issuance of the above Note to the Iowa � Finance Atrthority (the "Atrthority"). The resollrtioii also incorporates by refereilce the form of �i the Tax Exeinption Certificate aild Loan azld Disblirsement Agreemeilt, copies of which are enclosed for filing in your office. The Tax EYemption Certificate sets out in detail a number of facts, promises and obligations which must be met and agreed to by the City in order to inaintain this Note as tax exempt. The Loan and Disbursement Agreement also sets forth a nuinber of covenants and agreements on the part of the City with respect to the repayment of the Loan. I am also enclosing the final closulg certificates. The Transcript Certificate can be completed and dated as soon as final action has been talcen. The Deliveiy Certificate and the Tax Exemption Certificate should be executed but left undated. Siinilarly, all copies of the Loan and Disbursem.ent Agreement should be signed and sealed but left undated. The dates will be added pursuant to authorization froin the City at the time of final closing and delivery of the Note to the Authority. Please return these certificates and all copies of the Agreement to me for holding and review before the closiilg arrangeinents are made. An original form of Note R-1 is enclosed as well. The Note should be manually signed by the Mayor and City Clerlc on the lines indicated on page 3, the seal of the City should be impressed as indicated aiid the Treaslu•er should mallnally execute as the Registrar where indicated. The date of authentication �nd date of deliveiy will be inserted as of the actual closing date of the Loan. The completed Note also should be returned to us for holding prior to closing. WISHARD & BAILY — 1888; GUERNSEY & Bni�r — 1893: Bni�v $ STIPP — 1901; STIPP, PERRY, BANNISTER cQi STARZWGER — 1914; BANNISTER, CARPENTER, AHLERS & COONEY — 1950; AHLERS, COONEY, DORWEILER, ALLBEE, HAYNIE & SMITH — 1974: AIiLERS, COONEY, DORWEILER, HAVME, SMITH & A��aee. P.C. — 1990 � July 2, 2019 ' Page 2 A higlilighted copy of the Note is enclosed to illustrate the various spaces where a signatz.tre or seal is needed. The Tax Exemption Certificate is an iinportant docun�eilt and contaiils important information concerning the calculated yield on the Notes and a ntunber of covenants and obligations on the part of the City. This certificate should be retained as a part of your perinaneilt records. I will not attempt to slunmarize all of the matters wluch are iilchided in this � certificate but I do wailt to point out some iiilportant ones. Tax exemption is based in part upon the fact that the use of the facilities to be acquired by the City with the proceeds of the Loan will be for the benefit of the public and will not be used in the private trade or business of any business or non-tax-exempt entity. The properties acquired with the proceeds must not be sold or diverted to any private or nonpublic use Lulless the significance of that action is reviewed by bond counsel. We tmderstand that the proceeds of the loan will be used for the puipose of paying costs of construction of certain improvements and extensions to the Municipal Water Utility of the City. All of the financed facilities are expected to be owned by the City and used by the public geilerally, inclLiding coinmer•cial and indtiist�ial Lisers. We understand tliat tllere are no coiltrachtal arrangeineilts or agreements of any sort between the City and aily coinmercial or_ industrial user of the inunicipal utility with respect to rates or use of any part of the Utility. We recognize that larger custoiners of the Utility may be subject to charges or rates that are different fi•oin the current residential charges, depending on the volume of the water they purchase. Hov��ever, any such chai•ges inust be imposed by virtue of City ordinances and apply to all entities meeting the standai•ds set forth therein. No other charges or payments should be imposed or paid to the City by aily commercial or uldustrial user for water services or Project-related construction and acquisition activities beyond those inandated by ordinance for certain classes of useis. These understandings are reflected in the Tax Exemption Certificate, so please let me laiow immediately if otu•understandulgs are not coi7�ect in any respect. In addition,the Tax Exeil�ption Certificate sets foi�th the best knowledge and belief wluch the City has as of today concei7ling the timely expenditure of the proceeds as the City reasonably expects e�penditures to occLu�. If for any reason the City finds it will be prevented fi•om expending the proceeds fiilly wit1�1 tluee years, that inatter sholild be referred to us. This Note is issued tmder the expectation that the City will be exempt from the requirement to rebate arbitrage earilings to the United States Govermnent since you intend to spend the proceeds of the Note for construction puiposes within two (2) years of issuance and meet the other reqnuements of the two-year expendihire exemption from the rebate regulations. � There are a number of other general proinises and coinmitments by the City to talce or refi�ain fi•om action, which are necessaiy to maintain the tax exemption of this Note. You should recognize that these promises and cominitments are required of the City on an ongoing basis and that the possibility of some additional firture action does exist. I July 2, 2019 Page 3 Also enclosed is IRS Form 8038-G -- Inforillation Rettull for Tax Exeinpt Goveriullental Bond Issues. Please sigii, do not date �nd rettun to our office for completion. We will seild you a completed copy for yotu file at closing. Extra copies of the proceedings are enclosed to be completed as the original and certified bacic to our office. If any qllestioils arise, please don't hesitate to call. Vety truly yours, i Ahlers & Cooney, P.C. I� stin Billingsley Cooper FOR THE FIRM KBC:seb Enclosures cc: Kevin Firnstalil, City Clerlc, City of Dublique Tioiula Pooler, Independent Public Advisors, LLC 01605097-1\10422-197 {<**{<rl<*{<{<**** CERTIFIED TRANSCRIPT OF THE PROCEEDINGS OF THE CITY OF DUBUQUE, STATE OF IOWA, FOR THE ISSUANCE OF S4,400,000 WATER REVENUE CAPITAL LOAN NOTES, SERIES 2019 DATED: AUGUST 9,2019 Bearing interest at l.750Yo per annum, payable on December 1, 2019 and semiannually on the 1st day of June and December in each year thereafter. Lastmaturity date: June 1,2040. All notes may be called for redemption prior to maturity on any date following receipt of written consent by the Iowa Finance Authority PROCEEDINGS AND OPINION BY AHLERS & COONEY, P.C. DES MOINES,IOWA ***{<****!t* 0 1605 16 1-1\10422-197 CERTIFIED TRANSCRIPT OF T}IE PROCEEDINGS OF THE CITY OF DUBUQUE, STATE OF IOWA, FORTHE ISSUANCE OF $4,4OO,OOO WATERREVENUE CAPITAL LOAN NOTES, SERIES 2019, DATED: AUGUST 9,2019. Purchaser:Iowa Finance Authority (Tracy Scebold) Bond Counsel:Ahlers & Cooney, P.C. (Kristin Billingsley Cooper, Esq.) (Susan Ball) Registrar:Director of Finance and Budget (Jenny Larson) Municipal Advisor:Independent Public Advisors (Tionna Pooler) Legal Opinion dated August 9,2019. Resolution Authorizing Issuance adopted July 15, 2019. Loan and Disbursement Agreement. Delivery Certificate. Transcript Certifi cate. Tax Exemption certificate, including Purchaser's certificate (Exhibit A) Specimen ofNote. Financial Advisor Parity Report. IRS Form 8038-G, with attached Affidavit of Mailing. 1. 2. J. 4. 5. 6. ,7 8, 9, 0t605149-1\10422-197 AqLERS trtrtrNEY Ahlers & Cooney, P.C. Attorneys at Law 100 Court Avenue, Suite 600 Des Moines, lowa 50309-2231 Phone: 515-243-7611 Faxz 515-243-2149 www.ahlerslaw.com ATTORNEYS August 9,2019 We hereby certify that we have examined a certified transcript of the proceedings of the City Council and acts of administrative officers of the City of Dubuque, Iowa (the "Issuer"), relating to the issuance of Water Revenue Capital Loan Note No. R-1, Series 2019, by said Issuer, dated as of the date of delivery, in the aggregate principal amount of $4,400,000 (the "Note"). We have examined the law and such certified proceedings and other papers as we deem necessary to render this opinion as bond counsel. As to questions of fact material to our opinion, we have relied upon representations of the Issuer contained in the resolution authorizing the Loan and Disbursement Agreement and issuance of the Note (the "Resolution") and in the certified proceedings and other certifications of public officials furnished to us, without undertaking to verify the same by independent investigation. We have not been engaged to or undertaken to review the accuracy, completeness or sufficiency of any offering material relating to the Note and we express no opinion relating thereto. Based on our examination and in reliance upon the certified proceedings and other certifications described above, we are of the opinion, under existing law, as follows: 1. The Issuer is duly created and validly existing as a body corporate and politic and political subdivision of the State of Iowa with the corporate power to adopt and pcrform thc Resolution and Loan and Disbursement Agreement and issue the Note. 2. The Resolution and Loan and Disbursement Agreement have been duly adopted by the Issuer and constitute valid and binding obligations of the Issuer enforceable upon the Issuer. The Resolution creates a valid lien on the Net Revenues of the municipal water utility pledged by the Resolution for the security of the Note. The lien of the Note ranks on a parity as to the pledge of Net Revenues with respect to other Outstanding Obligations and Additional Obligations. The right to issue Additional Obligations is reserved upon conditions set forth in the Resolution. 3. The Note has been duly authorized, issued and delivered by the Issuer and is a valid and binding special obligation of the Issuer, payable solely from the sources provided therefor in the Resolution. Wishard&Baily-1888,Guernsey&Baily-1893,Baily&Stipp-lg0l,Stipp,Perry,Bannister&Starzinger-1914,Bannister,Carpenter, Ahlers & Cooney- 1950, Ahlers, Cooney, Dorweiler, Allbee, Haynie & Smith - 1974, Ahlers, Cooney, Dorweiler, Haynie, Smith &Allbee, P.C. - 1990 August 9,2079 $4,400,000 Water Revenue Capital Loan Notes, Series 2019 State of Iowa Revolving Fund Page2 4. Interest on the Note is excludable from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, such interest is taken into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax imposed on ceftain corporations. The opinion set forth in the preceding sentence is subject to the condition that the Issuer comply with all requirements of the Internal Revenue Code of 1986, as amended, that must be satisfied subsequent to the issuance of the Note in order that the interest thereon be, and continue to be, excludable from gross income for federal income tax purposes. The Issuer has covenanted to comply with all such requirements. Failure to comply with certain of such requirements may cause interest on the Note to be included in gross income for federal income tax purposes retroactively to the date of issuance of the Note. We express no opinion regarding the accuracy, adequacy, or completeness of offering material relating to the Notes. Further, we express no opinion regarding tax consequences arising with respect to the Notes other than as expressly set forth herein. The rights of the owners of the Notes and the enforceability of the Notes are limited by bankruptcy, insolvency, reorganization, moratorium, and other similar laws affecting creditors' rights generally, and by equitable principles, whether considered at law or in equity. This opinion is given as of the date hereof, and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention, or any changes in law that may hereafter occur. Respectfully submitted, Pc 0 1605 1 5 1-1\l 0422-197 a a ITEMS TO INCLUDE ON AGENDA CITY OF DUBUQUE, IOWA $4,400,000 Water Revenue Capital Loan Notes, Series 2019 Approve forms of Tax Exemption Certificate and Loan and Disbursement Agreement. Series Resolution authorizing and providing for the issuance and securing the payment of $4,400,000 Water Revenue Capital Loan Notes, Series 2019 by the City of Dubuque, Iowa under the provisions of Chapter 3 84 of the Code of Iowa, providing for a method of payment thereof, approving Loan and Disbursement Agreement, and other related matters NOTICE MUS T BE GIVEN PURSUANT TO IOWA CODE July 15, 2019 The City Council of Dubuque, Iowa, met in regular session, in the Historic Federal Building, 350 West 6th Street, Dubuque, Iowa, at 6:00 o'clock P.M., on the above date. There were present Mayor Roy D. Buol in the chair, and the following named Council Members: Luis Del Toro. Ric Jones. Kate Larson" David Resnick. Jake Rios. Brett Shaw Absent ****.**:1.*** -2- Council Member Resnick moved that the forms of Tax Exemption Certificate and Loan and Disbursement Agreement be placed on file and approved. Council Member Del Toro seconded the motion and the roll being called thereon, the vote was as follows: AYES: Larson. Shaw. Rios. Jones. Buol" Del Toro. Resnick NAYS: Council Member Resnick introduced the following Resolution entitled "SERIES RESOLUTION AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $4,4OO,OOO WATER REVENUE CAPITAL LOAN NOTES, SERIES 2019, By THE CITY OF DUBUQUE, IOWA UNDER THE PROVISIONS OF CHAPTER 384 OF THE CODE OF IOWA, PROVIDING FOR A METHOD OF PAYMENT THEREOF, APPROVING LOAN AND DISBURSEMENT AGREEMENT, AND OTHER RELATED MATTERS", and moved its adoption. Council Member Del Toro seconded the motion to adopt. The roll was called and the vote was: AYES: Larson. Shaw. Rios. Jones. Buol. Del Toro. Resnick NAYS: Whereupon the Mayor declared the following Resolution duly adopted: -3 - RESOLUTION NO.258.19 SERIES RESOLUTION AUTHORIZING AND PROVIDING FOR THE ISSUANCE AND SECURING THE PAYMENT OF $4,4OO,OOO WATER REVENUE CAPITAL LOAN NOTES, SERIES 2019 BY THE CITY OF DUBUQUE, IOWA LTNDER THE PROVISIONS OF CHAPTER 384 OF THE CODE OF IOWA, PROVIDING F'OR A METHOD OF PAYMENT THEREOF, APPROVING LOAN AND DISBURSEMENT AGREEMENT, AND OTHER RELATED MATTERS WHEREAS, the City Council of the City of Dubuque, Iowa (the "City") has heretofore established charges, rates and rentals for services which are and will continue to be collected as system revenues of the Municipal Water Utility System, and said revenues are available for the payment of water revenue bonds or notes,'subject to the following premises; and WHEREAS, by Resolution No. 379-08 passed and approved on October 20, 2008 (the "Master Resolution"), the City Council heretofore has authoizedthe issuance of $1,195,000 Water Revenue Capital Loan Notes, Series 2008D, for the purpose of financing the construction of the Series 2008D Project described therein, and to pay related costs of issuance; and WHEREAS, Issuer proposes to issue its Water Revenue Capital Loan Notes, Series 2019, to the extent of $4,400,000, for the purpose of defraying the costs of the Series 2019 Projects as set forth in Section I of this Resolutioni md, it is deemed necessary and advisable and in the best interests of the City that a form of Loan and Disbursement Agreement by and between the City and the Iowa Finance Authority, be approved and authorized; and WHEREAS, notice of the intention of the City Council to take action for the issuance of not to exceed $4,400,000 Water Revenue Capital Loan Notes has heretofore been dulypublished and no objections to such proposed action have been filed, and the City therefore deems it desirable to enter into a Loan and Disbursement Agreement and issue the Notes; and WHEREAS, Section 8.3 of the Master Resolution authorizes the issuance of additional Senior Bonds, including Senior SRF Bonds, by the City from time to time, if all of the conditions set forth therein are satisfied; and WHEREAS, the Council has determined to issue additional Senior SRF Bonds, and has determined that, upon passage of this Series Resolution and receipt of the reports described in Section 8.3 of the Master Resolution, all of the requirements of Article VIII of the Master Resolution with respect to the issuance of additional Senior SRF Bonds will have been satisfied. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IN THE COLTNTY OF DUBUQUE, STATE OF IOWA: -4- ARTICLE I DEFINITIONS Section 1.1. Definitions. Except as otherwise provided below in this Article I, all words and terms defined in Article I of the Master Resolution shall have the same meanings in this Series Resolution as such defined words and terms are given in Arlicle I of the Master Resolution. In addition, the following terms shall have the foliowing meanings in this Series Resolution unless the text expressly or by necessary implication requires otherwise: "Agreement" shall mean Loan and Disbursement Agreement dated as of the Closing between the City and the Original Purchaser relating to the Loan made to the City under the Program. 'rcity' or "Issuer" shall mean the City of Dubuque, Iowa. "Closing" shall mean the date of execution of the Agreement and delivery of the Series 2019 Notes to the Original Purchaser and the funding of the Loan. "Loan" shall mean the total principal amount allocated by the Original Purchaser to the City under the Program, equal in amount to the aggregate principal amount of the Series 2019 Notes. "Master Resolution" means the City Council Resolution No. 379-08, passed and approved on October 20,2008, entitled "Mastet Resolution relating to the issuance of Water Revenue Bonds by the City of Dubuque, Iowa under the provisions of Chapter 3 84 of the Code of lowa, authorizing and providing for the issuance and securing the payment of $1,195,000 Water Revenue Bonds, Series 2008D, providing for a method of payment thereof, funding a Debt Service Reserve Fund, and related matters," as the same may be amended from time to time. "Original Purchaser" means the Iowa Finance Authority, as the purchaser of the Series 2019 Notes from the City at the time of their original issuance. "Program" shall mean the Iowa Drinking Water Works Financing Program administered by the Original Purchaser. "Series 2019 Notesrr means the $4,400,000 Water Revenue Capital Loan Notes, Series 2019, dated the date of delivery, authorized to be issued pursuant to this Series Resolution. "Series 2019 Costs of Issuance Account" means the account by that name within the Project Fund established in Section 5.1 of the Master Resolution. "Series 2019 Projects" shall mean the Projects being financed with the proceeds of the Series 2019 Notes, consisting of costs of acquisition, construction, reconstruction, extending, remodeling, improving, repairing and equipping all or parl of the Municipal -5- Water System, including those costs associated with the Roosevelt Street water tower and water distribution improvements project and the Eagle Point water treatment plant and water distribution improvements ploject; and refunding the Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017, dated September 22,201J, as described generally in the Agreement and more parlicularly in the plans and specifications on file from time to time with the City Clerk. "Series 2019 Projects Accountil means the account by that name within the Project Fund estabiished in Section 5.1 of the Master Resolution. "Series 2019 Rebate Account" means the account by that name within the Rebate Fund established in section 6.10 0f the Master Resolution. "Series Resolution" means this Resolution of the Council. "Tax Exemption Certificate" means the Tax Exemption Certificate executed by the Treasurer and delivered at the time of issuance and delivery of the Series 2019 Notes. "Yield Restricted" shall mean required to be invested at a yield that is not materially higher than the yield on the Notes under Section 1a8(a) of the Internal Revenue Code or regulations issued thereunder. ARTICLE II THE SERIES 2019 Notes Section 2.L. Series 201,9 Notes - Authorization and Purpose. Pursuant to the provisions of the Master Resolution and in particular Section 8.3 thereof, there are hereby authorized to be issued, negotiable, serial, fully registered Water Revenue Capital Loan Notes, Series 2019, in the aggregate principal amount of $4,400,000, dated the date of delivery, for the purpose of constructing the Series 2019 Projects and paying Project Costs relating thereto, and to payrelated Costs of Issuance. The Series 2019 Notes shall be issued as Senior SRF Bonds under ih" t"tt rs of the Master Resolution, shall be designated "CITY OF DUBUQUE, IOWA, WATER REVENUE CAPITAL LOAN NOTES, SERIES 2019', and bear interest from the date hereof, untii payment thereof, at the offrce of the Paying Agent, said interest payable on December 1, 2079 and semiarurually thereafter on the lst day of June and December in each year until maturity at the rate hereinafter provided. The Council, pursuant to Sections 384.24A and 384.83 of the Code of Iowa, hereby finds and determines that it is necessary and advisable to issue said Series 2019 Notes authorized by the Agreement and this Series Resolution. The Series 2019 Notes and the Registrar's Certificate of Authentication shall be in substantially the form set forth in Exhibit A attached hereto, with such variations, omissions, substitutions and insertions as are required or permitted by this Seribs Resblution. The Series 2019 Notes shall be executed by the manual or facsimile signature of the Mayor and attested by the manual or facsimile signature of the City Clerk of the Council, and shall be fully registered as to both principal and interest as provided in this Series Resolution; -6- principal, interest and premium, if any shall be payable at the office of the Paying Agent by mailing of a check, wire transfer or automated clearing house system transfer to the registered owner of the Bond. The Series 2019 Notes shall be dated the date of delivery, and bear interest at the rate of I.7 5% per annum from the date of each advancement made under the Agreement, until payment thereof, at the offrce of the Paying Agent, said interest payable on December 1,2019, and semi- annuaily thereafter on the 1st day of June and December in each year until maturity as set forth on the debt service schedules attached to the Agreement as Exhibit A and incotporated herein by this reference. As set forth on said debt service schedules, principal shall be payable on June 1, 2021 and, annually thereafter on the 1st day of June in the amounts set forth therein until principal and interest are fully paid, except that the final installment of the entire balance of principal and interest, if not sooner paid, shall become due and payable on June 1,2040. Notwithstanding the foregoing or any other provision hereof, principal and interest shall be payable as shown on said debt service schedules until completion of the Series 2019 Project, at which time the final debt service schedules shali be determined based upon actuai advancements, final costs and completion of the Series 2019 Project, all as provided in the administrative rules governing the Program. Payment of principal and interest on the Series 2019 Notes shall at all times conform to said debt service sand the rules of the Program. In addition to the payment of principal of and interest on the Series 2019 Notes, the City also agrees to pay the Initiation Fee and the Servicing Fee as defined and in accordance with the terms of thle Agreement. Section 2.2. Issuance of Series 20L9 Notes in Certificated Form. The Series 2019 Notes shall be irr,r"d ur botrdr in Anthorized Denominations and may, atthe request of the Original Purchaser, be issued in the denomination of $ 1,000 or multiples thereof as a single Note in the denomination of $4,400,000 and numbered R-1. Section 2.3. Appointment of Reeistrar. The Treasurer is hereby appointed as Registrar for the Series 2019 Notes under the terms of this Series Resolution. Section 2.4. Execution. Authentication and Deliverv of the Series 2019 Notes. Upon the adoption of this Resolution, the Mayor and City Clerk shall execute and deliver the Series 2019 Notes to the Registrar, who shall authenticate the same and deliver the same to or upon order of the Original Purchaser. No such Series 2019 Note shall be valid or obligatory for any purpose or shall be entitled to any right or benefit hereunder unless the Registrar shall duly endorse and execute on such Series 2019 Note a Certificate of Authentication substantially in the form of the Certificate herein set forth. Such Certificate upon any such Series 2019 Note executed on behalf of the Issuer shall be conclusive evidence that the Series 2019 Note so authenticated has been duly issued under this Series Resolution and that the holder thereof is entitled to the benefits of this Series Resolution. 7- ARTICLE III REDEMPTION OF BONDS Section 3.1. Optional Redemption. The Series 2019 Notes are subject to optional redemption at aprice of par plus accrued interest (i) on any date upon receipt of written consent of the Original Purchaser or (ii) in the event that all or substantially all of the Series 2019 Projects are damaged or destroyed. Any optional redemption of the Series 2019 Notes may be made from any funds regardless of source, in whole or from time to time in part, rn inverse order of maturity, by giving not less than thirty (30) days notice of redemption by certified or registered mail to the Original Purchaser (or any other registered ou'ner of the Series 2019 Notes). The terms of redemption shall be par, plus accrued interest to date of call. The Series 2019 Notes are also subject to mandatory redemption as set forth in Section 5 of the Agreement. ARTICLE IV DELIVERY AND APPLICATION OF PROCEEDS Section 4.1. Annlication of Series 2019 Note Proceeds. The Series 2019 Notes shall be delivered as provided in Sections 6.1 and 6.2 andthe proceeds thereof shall be applied as follows: (i)An amount sufficient to pay the Costs of Issuance of the Series 2019 Notes shall be deposited into the Series 2019 Costs of Issuance Account. (ii) The balance of proceeds shall be deposited into the Series 2019 Projects Account of the Project Fund and applied thereafter to pay Project Costs of the Series 2019 Projects. Section 4.2. No Adiustment to Debt Service Reserve Requirement. The Series 2019 Notes shall be issued as Senior SRF Bonds under the Master Resolution, and shall not be secured by or payable from amounts held in the Debt Service Reserve Fund established in the Master Resolution. Upon issuance of the Series 2019 Notes, the amount to be accumulated and maintained in the Debt Service Reserve Fund shall not be increased, but shall continue to remain equal to 100% of the Debt Service Reserve Requirement computed on a basis which includes all Senior Bonds which will be Outstanding immediately after issuance of the Series 2019 Notes and which are not Senior SRF Bonds. ARTICLE V TAX PROVISIONS Section 5.1. Disposition of Bond Proceeds; Arbitrase Not Permitted. The City reasonably expects and covenants that no use will be made of the proceeds from the issuance and sale of the Series 2019 Notes issued hereunder which will cause any of the Series 2019 Notes to be classified as arbitrage bonds within the meaning of Section 148(a) and (b) of the Code, and that throughout the term of said Series 2019 Notes it will comply with the requirements of said statute and regulations issued thereunder. -8- To the best knowledge and belief of the City, there are no facts or circumstances that would materially change the foregoing statements or the conclusion that it is not expected that the proceeds of the Series 2019 Notes will be used in a manner that would cause such bonds to be arbitrage bonds. Without limiting the generality of the foregoing, the City hereby agrees to comply with the provisions of the Tax Exemption Certificate and the provisions of the Tax Exemption Certificate are hereby incorporated by referencs as part of this Series Resolution. The Treasurer is hereby directed to make and insert all calculations and determinations necessary to complete the Tax Exemption Certificate in all respects and to execute and deliver the Tax Exemption Certificate at issuance of the Series 2019 Notes to certifv as to the reasonable expectations and covenants of the City atthat date. The City covenants that it will treat as Yield Restricted any proceeds of the Series 2019 Notes remaining unexpended after three years from the issuance and any other funds required by the Tax Exemption Certificate to be so treated. If any investments are held with respect to the Series 2019 Notes, the City shall treat the same for the purpose of restricted yield as held in proportion to the original principal amounts of each issue' The City covenants that it will exceed any investment yield restriction provided in this Series Resolution only in the event that it shall first obtain an opinion of bond counsel that the proposed investment action will not cause the Series 2019 Notes to be classified as arbitrage bonds under Section 1a8(a) and (b) ofthe Code. The City covenants that it will proceed with due diligence to spend the proceeds of the Series 2019 Notes for the purpose set forth in this Series Resolution. The City further covenants that it will make no change in the use of the proceeds available for the construction of facilities or change in the use of any porlion of the facilities constructed therefrom by persons other than the City or the general public unless it has obtained an opinion of bond counsel or a revenue ruling that the proposed project or use will not be of such character as to cause interest on any of the Series 2019 Notes not to be exempt from federal income taxes in the hands of holders under the provisions of the Code. Section 5.2.Additional C ovenants finns and Wa rranties nf fhe Cifv The City certifies and covenants with the purchasers and holders of the Series 2019 Notes from time to time outstanding that the City through its officers, (a) will make such fuither specific covenants, representations and assurances as may be necessary or advisable; (b) comply with all representations, covenants and assurances contained in the Tax Exemption Certificate, which Tax Exemption Cerlificate shall constitute apaft of the contract between the City and the owners of the Series 2019 Notes; (c) consult with bond counsel (as defined in the Tax Exemption Certificate); (d) pay to the United States, as necessary, such sums of money representing required rebates of excess arbitrage profits relating to the Series 2019 Notes; (e) file such forms, statements and supporting documents as may be required and in a timely manner; and (f) if deemed necessary or advisable by its officers, to employ and pay fiscal agents, financial advisors, attorneys and other pelsons to assist the City in such compliance. -9 - ARTICLE VI MISCELLANEOUS PROVISIONS Section 6.L.Deliverv of es 2019 Notes. The City shall deliver the executed Agreement and the Series 2019 Notes to the Original Purchaser at the price of par on the date of Closing. Delivery of the executed Agreement and the Series 2019 Notes shall be made to the Original Purchaser as soon as practicable after the effective date of this Series Resolution. Section 6.2. Approval of Asreement. The Agreement in substantially the form presented at this meeting of the Council are hereby authorized and approved, and the Mayor and City Clerk are authorizedto execute and deliver the Agreement, with such changes therein as such officials deem appropriate, for and on behalf of the City, such officers' signatures thereon being conclusive evidence of such officials' and the City's approval thereof. Section 6.3. General Authorization. From and after the date of adoption of this Series Resolution, the officers, employees and agents of the City are hereby authorized to do all such acts and things and to execute and deliver any and all other documents, agreements, certificates and instruments relating to the Series 2019 Notes, the investment of the proceeds thereof and the other transactions contemplated on the part of the City by this Series Resolution, including, but not limited to, the Tax Exemption Certificate refened to in Section 5.1 hereof. Section 6.4. Construction. Except to the extent set forth herein, all of the applicable terms, conditions and provisions of the Master Resolution shall be deemed and construed to apply to the Series 2019 Notes and are hereby incorporated by reference and made aparthereof to the same extent as if fully set forth herein. Except as may otherwise be provided herein, the Master Resolution shall remain in full force and effect. Section 6.5. Severability. If any section, paragraph, or provision of this Series Resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions. Section 6.6.Reneal of C)rdinances or Resolutions and Effective I)ate All other ordinances, resolutions and orders, or parts thereof, in conflict with the provisions of this Series Resolution are, to the gxtent of such conflict, hereby repealed; and this Series Resolution shall be in effect from and after its adoption. -10- PASSED AND APPROVED this 15th day of July, 2019. Mayor ATTEST: 0 - 11- CERTIFICATE STATE OF IOWA COLINTY OF DUBUQUE I, the undersigned City Cterk of Dubuque, Iowa, do hereby certify that attached is a true and complete copy of the portion of the corporate records of said Municipality showing proceedings of the Council, and the same is a true and complete copy of the action taken by said Council with respect to said matter at the meeting held on the date indicated in the attachment, which proceedings remain in full force and effect, and have not been amended or rescinded in any way; that meeting and all action thereat was duly and publicly held in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the Council and posted on a bulletin board or other prominent place easily accessible to the public and clearly designated for that purpose at the principal office of the Council (a copy of the face sheet of said agenda being attached hereto) pursuant to the local rules of the Council and the provisions of Chapter 2I, Code of Iowa, upon reasonable advance notice to the public and media at least twenty-four hours prior to the commencement of the meeting as required by said law and with members of the public present in attendance; I further certify that the individuals named therein were on the date thereof duly and lawfully possessed of their respective city offices as indicated therein, that no Council vacancy existed except as may be stated in said proceedings, and that no controversy or litigation is pending, prayed or threatened involving the incorporation, organization, existence or boundaries of the City or the right of the individuals named therein as officers to their respective positions. my hand and the seal of said Municipality hereto affixed irli, .bfr day of 20r9 SS ) ) ) City I owa SEAL -12- E,XHIBIT A REGISTERED Certificate No. R-l UNITED STATES OF AMERICA STATE OF IOWA COUNTY OF DUBUQUE CITY OT DUBUQUE WATER REVENUE CAPITAL LOAN NOTE SERIES 2OI9 Final Maturitv Date June L,2040 REGISTERED Principal Amount $4,400,000 Note Date August 9,2019 Interest Rate 1.750'/' The City of Dubuque, Iowa, a municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of Iowa (the "Issuer"), for value received, promises to pay from the source and as hereinafter provided, to IOWA FINANCE AUTHORITY or registered assigns, the principal sum of FOUR MILLION FOUR RED THOUSAND DOLLARS in lawful money of the United States of America, on the maturity dates and in the principal amounts set forth on the Debt Service Schedule attached hereto and incorporated herein by this reference, with interest on said sum from the date of each advancement made under a certain Loan and Disbursement Agreement dated as of the date hereof until paid at the rate of L75o/o pet annum, payable on December 1,2019, and semi-annually thereafter on the lst day of June and Decembir in each year. As set forth on said Debt Service Schedule, principal shall be payable on June 1, 202I and annually thereafter on the first day of June in the amounts set forth therein until principal and interest are fully paid, except that the final installment of the entire balance of principal and interest, if not sooner paid, shall become due and payable on June I,2040. Notwithstanding the foregoing or any other provision hereof, principal and interest shall be pa;'able as shown on said Debt Service Schedule until completion of the Project, at which time the final Debt Service Schedule shall be determined and attached hereto based upon actual advancements, final costs and completion of the Project, all as provided in the administrative rules governing the Iowa Drinking Water Facilities Financing Program. Payment of principal and interest of this Note shall at all times conform to said Debt Service Schedule and the rules of the Drinking Water State Revolving Fund Program. Interest and principal shall be paid to the registered holder of the Note as shown on the records of ownership maintained by the Registrar as of the 15th day of the month next preceding such interest payment date. Interest shall be computed on the basis of a 360-day year of twelve 30- day months. This Note is issued pursuant to the provisions of Sections 384.24A and 384.83 of the Code of Iowa, for the purpose of paying costs of acquisition, construction, reconstruction, extending, remodeling, improving, repairing and equipping all or part of the Municipal Water System, including those costs associated with the Roosevelt Street water tower and water distribution improvements -13- project and the Eagle Point water treatment plant and water distribution improvements project; and refunding the Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017, dated September 22,2017 , and evidences amounts payable under a certain Loan and Disbursement Agreement dated as of the date hereof, in conformity to a Master Resolution of the City Council of said City duly passed and approved on October 20,2008 (the "Master Resolution") and a Series Resolution of the City Council of said City duly passed and approved on July 15,2019 (the "Series Resolution"). For a complete statement of the revenues and funds from which and the conditions under which this Note is payable, a statement of the conditions under which additional series notes or bonds of equal standing may be issued, and the general covenants and provisions pursuant to which this Note is issued, reference is made to the above-described Loan and Disbursement Agreement, the Master Resolution and the Series Resolution. This Note is one of the Series 2019 Notes authorized for issuance in the Series Resolution. Capitalizedterms not defined herein shall have the meanings given to them in the Series Resolution or Master Resolution. This Note is subject to optional redemption at a price of par plus accrued interest (i) on any date upon receipt of written consent of the Iowa Finance Authority or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any optional redemption of this Note may be made from any funds regardless of source, in whole or from time to time in part, in inverse order of rnaturity, by lot by giving thirty (30) days'notice of redemption by certified or registered mail, to the Iowa Finance Authority (or any other registered owner of the Note). This Note is also subject to mandatory redemption as set forth in Section 5 of the Agreement. Ownership of this Note may be transferred only by transfer upon the books kept for such purpose by the Director of Finance and Budget/City Treasurer, City of Dubuque, Iowa the Registrar. Such transfer on the books shall occur only upon presentation and sumender of this Note at the office of the Registrar, together with an assignment duly executed by the owner hereof or his duly authorized attorney in the form as shall be satisfactory to the Registrar. Issuer reserves the right to substitute the Registrar and Paying Agent but shall, however, promptly give notice to registered Noteholders of such change. All Notes shall be negotiable as provided in Article 8 of the Uniform Commercial Code and subject to the provisions for registration and transfer contained in the Note Resolution. This Note and the series of which it forms apart, other obligations ranking on a parity therewith, and any additional obligations which may be hereafter issued and outstanding from time to time on aparity with said Notes as Senior Bonds under the Master Resolution, are payable from and secured by a pledge of the Net Revenues of the municipal water utility (the "System"), as defined and provided in the Master Resolution. There has heretofore been established and the City covenants and agrees that it will maintain just and equitable rates or charges for the use of and service rendered by said System in each year for the payment ofthe proper and reasonable expenses ofoperation and maintenance of said System and for the establishment of a sufficient sinking fund to meet the principal of and interest on this series of Notes, and other obligations ranking on a parity therewith, as the same become due. This Note is not payable in any manner by taxation and under no circumstances shall the City be in any manner liable by reason of the failure of said Net Revenues to be sufficient for the payment hereof. -14- The Issuer has covenanted and hereby covenants and agrees at all times while any Senior Bonds are Outstanding and unpaid to budget for and collect amounts in respect of the use of the System fully sufficieni at alltimes to: (i) provide for 100% of the budgeted Operation and Maintenance Expenses of the System and (ii) produce Net Revenues in each Fiscal Year which will: (a) equal at least lI0% of the Debt Service Requirement on all Senior Bonds then Outstanding for the year of computation, (b) enable the Issuer to make all required payments, if any, into the Debt Service Reserve Fund and the Rebate Fund, (c) enable the Issuer to accumulate an amount which, in the judgment of the Council, is adequate to meet the costs of major renewals, replacements, repairs, additions, betterments and improvements to the System, necessary to keep the same in good operating condition or as is required by any governmental agency having jurisdiction over the System, and (d) remedy all deficiencies in required payments into any of the funds and accounts established under the Master Resolution from prior Fiscal Years' The Master Resolution contains a more particular statement of the covenants and provisions securing the Senior Bonds, the conditions under which the owner of this Note may enforce covenants (other than the covenant to pay Principal of and interest on this Note when due from the sources provided, the right to enforce which is unconditional), the conditions upon which additional Senior Bonds may be issued on a parity or achieve parity status with this Note under the Master Resolution, and the conditions upon which the Master Resolution may be amended with the consent of the owners of not less than two-thirds in aggregate Principal amount of the Bonds Outstanding or the issuer of any Credit Facility, if any, of such Bonds. Upon the occurence of an Event of Default under the Master Resolution, the owner of this Note shall be entitled to the remedies provided by the Master Resolution. And it is hereby represented and certified that all acts, conditions and things requisite, according to the laws and Constitution of the State of Iowa, to exist, to be had, to be done, or to be performed precedent to the lawful issue of this Note, have been existent, had, done and performed as required by law. IN TESTIMONY WHEREOF, said City by its City Council has caused this Note to be signed by the manual or facsimile signature of its Mayor and attested by the manual or facsimile signature of its City Clerk, with the seal of said City impressed hereon, and authenticated by the manual or facsimile signature of an authorized representative of the Registrar, the City Treasurer of the City of Dubuque, Iowa, all as of the day of 2019 - 15 - Date of authentication CITY OF DUBUQUE, STATE OF IOWA This is one of the Notes described in the within mentioned Resolution, as registered by the City By: Treasurer Mayor CITY TREASURER, Registrar ATTEST: By: Authorized Signature City Clerk (sEAL) Registrar and Transfer Agent: City Treasurer Paying Agent: City Treasurer ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto (Social Security or Tax Identification No the within Note and does hereby irrevocably constitute and appoint attorney in to transfer the said Note on the books kept for registration of the within Note, with full power of substitution in the premises. By: ) fact Dated: (Person(s) executing this Assignment sign(s) here) SIGNATURE ) GUARANTEED) IMPORTANT - READ CAREFULLY The signature(s) to this Power must correspond with the name(s) as written upon the face of the certificate(s) or Note(s) in every particular without alteration or enlargement or any change whatever. Signature guarantee must be provided in accordance with the prevailing standards and procedures of the Registrar and Transfer Agent. Such standards and procedures may require signature to be guaranteed by certain eligible guarantor institutions that participate in a recognized signature guarantee program. -16- INFORMATION REQUIRED FOR REGISTRATION OF TRANSFER Name of Transferee(s) Address of Transferee(s) Social Security or Tax Identification Number of Transferee(s) Transferee is a(n): Individual* Partnership Corporation Trust *If the Note is to be registered in the names of multiple individual owners, the names of all such owners and one address and social security number must be provided. The following abbreviations, when used in the inscription on the face of this Note, shall be construed as though written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with rights of survivorship and not as tenants in common IA TINIF TRANS MIN ACT Custodian (Cust) (Minor) Under Iowa Uniform Transfers to Minors Act............. (State) ADDITIONAL ABBREVIATIONS MAY ALSO BE USED THOUGH NOT iN THE ABOVE, LIST 01 605 1 85-1\1 0422-197 -17 - Estimated Amortization Schedule City of Dubuque Water Revenue Bond FS-31-19-DWSRF-014 Loan Closing Final Disbursement lniliotion Fee - Aug 9, 2019 P & D Poyoff - Aug 9, 2019 Estimoted Drow #l- Aug 9,2019 Estimoled Drow #2- SeP 27,2019 Eslimoted Drow #3- Nov 15, 2019 Eslimoted Drow #4- Jon 3, 2020 Eslimoted Drow #5- Feb2l,2O2O Eslimoled Drow #6- Apr 10,2020 Estimoled Drow #7- Moy 29,2020 Estimoled Drow #B- Jul 17,2020 Estimoled Drow #9- Sep 4,2020 Eslimoted Drow #10- Ocl23,2020 Held for Finol Docs - Nov 20. 2020 Totol Looned Amounl SRF STATE FiYJLVIiltJ iLiIJI Final l\/aturity Date Loan Period in Years Total Loaned Amount 0.5%.lnitiation Nel Proceeds to Annual lnlerest Tolal Servicing Fee Total Servicing Total Loan Costs Auq 9, 2019 Nov 20, 2020 Jun 1,2040 20 $ 4,400,000.00 22,000.00 $ 4,378,000.00 1.75o/a $ 878,081.77 0.25% $ 125,440.26 $ 1,025,522.03 22,000.00 444,162.62 375,5a3.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 1 78,000.00 4,400,000.00 Payment Beginning Balance Servicing Total Loan PavmentPrincipallnterestFee Total Annual Debt Service Ending BalanceDate Dec 1,2019 Jun 1,2020 Dec 1,2O2o Jyn 1:2021 Dec 1,2021 Jyn 1,2O2? Dec 1,2022 Jun l,2023 1,217,330.10 2,71 9,665.05 4,222,OO0.00 4,400,000.00 5,751.32 1e,699:12 31,848.65 38,595.1 8 36,916.25 36,916.25 35,297.50 35,297.50 33,652.50 821.62 6,572.94 22,501.85 29,074. '1,217,330.10 2,71 9,665.05 181 4,549.81 5,513.60 36,398.46 4,222,OOO.00 4,21 9,000.001 08.78 261 .24 42,190.00 4,21 9,000.00 4,034,000.00190.00 269,380.00 40,340.00 4,034,000.00 - _ q q4qrq00:00' 3,846,000.00 268,680.00 38,460.00 230,460.00 268,920.00 3,654,000.00 Dec 1,2023 Jun 1,2024 Dec 1 ,2024 Jun l. 2025 Dec 1,2025 Jun 1, 2026 Dec 1,2026 Jun 1,2027 Dec 1,2027 Jun 1-,2028 Dec 1. 2028 4,219,000.00 4,219,000.00 4,034,000.00 .4.034p0_0:00 3,846,000.00 3,846j00q:_oo 3,654,000.00 5,273.75 5,273.75185,000.00 188,000.00 192,000.00 196,000.00 5,042.50 5,042.50 4,807.50 4,807.50 31,972.50 4,567.50 36,540.00 3,654,000.00 3,1,_e_7_?:9o _ _1,592,!9 _ z:t?p!oI_o -,- - _2qe-pqq:0_0 3,1P,0q9.99__3r654,00_q.0q 3,458,000.00 3,458,000.00 3,258,000.00 3,054,000.00 3,051,00q:90_ 2,846,000.00 30,257.50 4,322.50 2oo,0go:og 90,2q7:5-0, 4p2?.1:o 28,507.50 28,507.50 4,072.50 -!.97?'5:o3,817.50 3,817.50 32,580.00 236,580.00 269,1 60.00 3,458,000.00 , 3,?5q,qo9 00 3,258,000.00 3,054,000.00204,000.00 208,000.00 34,580.00 234,580.00 1 60.00 26,722.50 30,540.00 _48,510.q0 _ 28,460.00 2!2-,?+o W 24,180.00 245,1 80.00 3,054,000.00 269,080.00 21 2,000.00 24,902.50 902.50 3,557.50 3,557.50 ?49,19!.q0 268 26,340.00 2,846,000.00 2,634,000.00 ?,418p-0qr9o, 2,418,000.00 2,1 2,1 97,000.00 1,972,000.00 ,920.00Jun1,,2029 .2,846,000.00 Dec1,2029 2,634,000.00 Jun1,2030 2,634,000.00 Dec1,2030 2,418,000.00 21 6,000.00 221,000.oo 23,047.50 2:3!947.59 21 ,157.50 21 ,157.50 3,292.50 3,?9?,90 3,022.50 1,9??,!0 2,746.25 268,680.00 Jun 1, 203'1 . - 2r118490_:9q Dec1,2031 2,197,000.00 19,223.75 19,223.75 21,970.00 246,970.001 97,000.00 Dec 1, 2032 1 ,972,000.00 _Jun1,2033 1,sl?,0_00.00 230 17,255.00 2,465.00 19,720.00 1,972'000.00 17r?5?.9.0 , ?,!69po- - _ 24_e:/29:99 __ 26e,14!jq:o- _ _ 1,74?q!q.90 . Dec 1, 2033 Jun 1,2034 1,742,000.00 1,742,000.00 2,177.50 2,177.50 17,420.00 251,420.OO 268,840.00 1,742,000.00 '1,508,000.00 Dec 1, 2034 Jun 1, 2035 '1,508,000.00 15,242.50 15,24L50 1 3,1 95.00 __r31e!,99 11.103.75 1,885.00 ,11885:-00 1,586.25 1,586.25 15,080.00 239,000.00 269,1 60.00 1,508,000.00 1 ,269,000.00 Dec 1,2035 Jun 1.2036 Dec 1, 2036 Jun 1 . 2037 Dec 1, 2037 Jun 1,2038 Dec 1, 2038 Jun 1 , 2039 1 ,269,000.00 1r?69:09_09q 1,025,000.00 776,000.00 776,000.00 523,000.00 523,000.00 1 2,690.00 1,269,000.00 244,000.00 269,380.00 g?9i990.q0 1,025,000.00 249,000.00 8,968.75 I L291:2? _?q9:as0i0g__269,500.00 8,968.75 1,281.25 10,250.00 1,025,000.00 776,000.00 776,000.00 268r_5?9.q0 52-1qq0.90 523,000.00 264,000.00 Dec 1, 2039 Jun 1, 2040 264,000.00 264,000.00 253,000.00 259,000.00 6,790.00 6,790.00 4,576.25 4,576.25 970.00 970.00 7,760.00 260,760.00 5,230.00 264,230.00 bcJ. /c 653.75 2,310.00 2,310.00 2,640.00 266,640.00 264,000.00 0.00 As of 6/2812019 264,000.00 330.00 330.00 INVESTING IN IOWA'S WATER w.iowasrf.com LOAN AND DISBURSEMENT AGREEMENT $4,400,000 WATER REVENUE CAPITAL LOAN NOTES, SEzuES 2019 (IOWA DzuNKING WATER FACILITIES FINANCiNG PROGRAM) (ROOSEVELT/EAGLE POINT) This Loan and Disbursement Agreement (the "Agreement") is made and entered into as of August g,2019 by and between the City of Dubuque, Iowa (the "Participant") and the Iowa Finance Authority, an agency and public instrumentality of the State of Iowa (the "Issuer"). WHEREAS, the Issuer, in cooperation with the Iowa Department of Natural Resources (the "Department"), is authorized to undertake the creation, administration and financing of the Iowa Drinking Water Facilities Financing Program (the "Program") established in Iowa Code Sections 16.i31 through i6.135 and Sections455B.29l through 455B.299,including, among other things, the making of loans to Water Systems for purposes of the Program; and WHEREAS, the Participant desires to participate in the Program as a means of financing all or part of the construction of certain drinking water treatment facilities serving the Parlicipant and its residents; and WHEREAS, to assist in financing the Project (defined herein), the Issuer desires to make a loan to the Participant in the amount set forth in Section 2 hereof; NOW, THEREFORE, the parties agree as follows: Section 1. Definitions. In addition to other definitions set forth herein, the following terms as used in this Agreement shall, unless the context clearly requires otherwise, have the following meanings: (a) "Bonds" shall mean any State Revolving Fund Revenue Bonds that were or in the future are issued by the Issuer for the purpose of providing moneys to finance the Loan to the ParticiPant. (b) "Code" shall mean the Internal Revenue Code of 1986, as amended, and all lawfuliy promulgated regulations thereunder. (c) "Project" shall mean the particular construction activities approved by the Deparlment and being undertaken by the Participant with respect to the operation or infrastructure of the Water System for the purpose of providing safe drinking water to the customers thereof, as described in the Resolution' (d) "Regulations" shall mean the administrative rules of the Department relating to the Program, set forlh in Title 567 , Chapter 44 of the Iowa Administrative Code, and the administrative rules of the Issuer relating to the Program set forth in Title 265, Chapter 26 of the Iowa Administrative Code. (e) "Resolution" shall mean the resolution of the City Council of the Participant, adopted on July 15, 2019, approving and authorizing the execution of this Agreement and the issuance of the Revenue Bond (as defined herein). 06/23120t6I (0 "Water System" shall mean the drinking water system of the Participant, all facilities being used in conjunction therewith and all appuftenances and extensions thereto, including but not limited to the water facilities which the Participant is financing under this Agreement. Section 2. Loan: Purchase of Revenue Bond. The Issuer agrees to purchase a duly authorized and issued water revenue bond or capital loan note of the Participant (the "Revenue Bond") in order to make a loan to the Participant, and will disburse proceeds as set forth herein' The Participant agrees to borrow and accept from the Issuer, a loan in the principal amount of $4,400,000 (the "Loan"). The Participant shall use the proceeds of the Loan strictly (a) to finance a porlion of the costs of construction of the Project and (b), where applicable, to reimburse the Participant for a portion of the costs of the Project, which portion was paid or incurred in anticipation of ieimbursement through the Program and which is eligible for such reimbursement under and pursuant to the Regulations and the Code. Section 3. Disbursements. Proceeds of the Loan shall be made available to the Participant in the form of one or more periodic disbursements as provided in this Section. The Issuer thereafter shall make disbursements of a portion of the Loan for payment of costs of the Project upon receipt of the following: (a) a completed payment request on a form acceptable to and available from the Issuer; (b) current construction payment estimates; (c) engineering service statements; (d) purchase orders or invoices for items not included within other contracts; and (e) evidence that the costs for which the disbursement is requested have been incurred. Solely with respect to the request for the final disbursement of proceeds of the Loan, the Participant shall submit to the Issuer (via the Department), in addition to items (a) through (e) above, a certification of completion and acceptance of the Project by the Participant or evidence of an acceptable settlement if the Project is subject to a dispute between the Participant and any contractor. Disbursements shall be made in a timeiy fashion following the receipt of the information as set forlh above. Unless otherwise agreed to in writing by the Issuet, funds shall be payable to the Participant via automated clearinghouse system transfer to the account specified by the Parlicipant. Section 4. Completion of Project. The Participant covenants and agrees (i) to exercise its best efforts in accordance with prudent water treatment utility practices to complete the Project; 2 and (ii) to provide from its own fiscal resources all monies, in excess of the total amount of Loan proceeds it receives under the Agreement, required to complete the Project. Section 5.tof of The Participant's obligation to repay the Loan and interest thereon shall be evidenced by the Revenue Bond in the principal u-onnt of the Loan, complying in all material respects with the Regulations and being in substantially the form set forth in the Resolution. The Revenue Bond shall be delivered to the Issuer as the original purchaser and registered holder thereof at the closing of the Loan. The Revenue Bond shall be accompanied by a legal opinion of bond counsel, in form satisfactory to the Issuer, to evidence the legality, security position and tax-exempt status of interest on the Revenue Bond. The parties agree that apayment of principal of or interest on the Revenue Bond shall be deemed to be a payment of the same on the Loan and a payment of principal of or interest on the Loan shall be deemed to be a payment of the same on the Revenue Bond. Unless otherwise agreed to in writing by the Issuer, all payments of principal and interest due under the Loan shall be made via automated clearinghouse transfer, ftom an account specified by the Participant' The Revenue Bond shall be dated the date of delivery to the Issuer, with interest and the Servicing Fee (together, the "Interest Rate" as set forth in Section 6 hereof) payable semiannually on June 1 and December I of each year (unless the resolution authorizing a previous series of outstanding bonds on a parity inith the Revenue Bond requires interest to be paid on other interest payment dates, in which case such other dates shall apply) from the date of each disbursement of a part of the Loan from the Issuer to the Participant (which are initially expected to be on approximately the dates set forth on Exhibit A attached hereto and incorporated herein). The first tepay-ent of principal of the Loan shall be due and payabie not later than one year after substantial "ompletiotr of th. project and payments of principal, interest and the Servicing Fee shall continue thereafter until the Loan is paid in fuIl. Following the final disbursement of Loan proceeds to the participant, Exhibit A shall be adjusted by the Issuer, with the approval of the Participant, based upon actual disbursements to the Participant under the Agreement. Such revised Exhibit A thereafter shall be deemed to be incorporated herein by reference and made apafihereof and shall supersede and replace that initially attached hereto and to the Revenue Bond. The Revenue Bond shall be subject to optional redemption by the Participant at a price of par plus accrued interest (i) on any date upon receipt of written consent by the Issuer, or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any such optional redemption of the Revenue Bond by the Participant may be made from any funds regardless of ,o,n"i in whole or from time to time in part, upon not less than thirty (30) days notice of redemption by e-mail, facsimile, certified or registered mail to the Issuer (or any other registered owneiof the Revenue Bond). The Revenue Bond is also subject to mandatory redemption in the event the costs of the Project are less than initially projected, in which case the amount of the Loan shall be reduced to an amount equal to the actual Project costs disbursed. The Participant and the Issuer agree that following such adjustment, the principal amount due under the Revenue Bond shall be automatically reduced to equal the principal amount of the adjusted Loan. The Revenue Bond and the interest thereon and any additional obligations as may be hereafter issued and outstanding from time to time under the conditions set forth in the Resolution shall be payable solely and only from the Net Revenues (as defined in the Resolution) of the Water System of in" Participant, a sufficient portion of which has been and shall be ordered set aside and J pledged for such purpose under the provisions of the Resolution. Neither this Agreement nor the R",r.tt r" Bond is a general obligation of the Participant, and under no circumstance shail the participant be in any manner liable by reason of the failure of the aforesaid Net Revenues to be suffrcient to pay the Revenue Bond and the interest thereon or to otherwise discharge the Parlicipant' s obligation hereunder. Section 6 Fee . (a) The Participant agrees to pay to the Issuer, as additional consideration for the Loan, a loan initiation fee (the "Initiation Fee"jequal to one half of one percent (0.50) of the amount of the Loan($22,000), which shail be due anilpayable on the date of this Agreement. Unless the Issuer shall be otherwise notified by the Participant that the Parlicipant intends to pay such Initiation Fee from other funds, and has received such other funds from the Participant on the date hereof, the Issuer shall be authorized to deduct the full amount of the Initiation Fee from the proceeds of the Loan being made hereunder, and such deduction by the Issuer shall be deemed to be an expenditure by the Parlicipant of the Loan proceeds. (b) The Parlicipant agrees to pay a Loan servicing fee (the "Servicing Fee") to the Issuer in an amount equal to 0.25o/o per annum of the principal amount of the Loan outstanding. The Servicing Fee shall be paid as described in Section 5 and Section 6(c) hereof. (c) The Loan shall bear interest at 1 .75o/oper annum (the "Rate"). As described in Section 5, payments hereunder shall be calculated based on the Rate plus the Servicing Fee (such 2.00yo, the "Interest Rate"). Section 7 f-^mnlicncc -"i+h A nnli cable T.aurq onne TT nder Loan A craamanf Rates. The Participant covenants and agrees (i) to comply with all applicable State of Iowa and iederal laws, rules and regulations (including but not limited to the Regulations), judicial decisions, and executive orders in the performance of the Agreement and in the financing, consttuction, operation, maintenance and use of the Project and the Water System; (ii) to maintain its Water System in good repair, working order and operating condition; (iii) to cooperate with the Issuer in the observance and performance of its respective duties, covenants, obligations and agreements under the Agreement; (iv) to comply with all terms and conditions of the Resolutiorr; and (v) to establish, levy and collect rents, rates and other charges for the products and services provided by its Water System, which rents, rates and other charges shall be at least sufficient (A) to meet the operation and maintenance expenses of such Water System, (B) to produce and maintain Net Revenues at a level not less than 1l\oh of the amount of principal andinterest onthe Revenue Bond and any other obligations secured by a pledge of the Net Revenues falling due in the same year, (C) to comply with all covenants pertaining thereto contained in, and all other provisions of, any bond resolution, trust indenture or other security agreement, if any, relating to any bonds or other evidences of indebtedness issued or to be issued by the Participant. (D) to pay the debt service requirements on any bonds, notes or other evidences of indebtedness, whether now otttstanding or incurred in the future, secured by such revenues or other receipts and issued to finance improvements to the Water System and to make any other payments required by the laws of the State of Iowa, (E) to generate funds sufficient to fulfill the terms of all other contracts and agreements made by the Participant, including, without limitation, the Agreement and the Revenue Bond and (F) to pay all other amounts payable from or constituting a lien or charge on the operating revenues of its Water System. 4 Section 8 Exclusion of Interest from Gross Income. Unless otherwise agreed to by the Issuer in writing, the Participant covenants and agrees as follows: (a) The Participant shall not take any action or omit to take any action which would result in a loss of the exclusion of the interest on the Bonds from gross income for federal income taxation as that status is governed by Section 103(a) of the Code. (b) The Participant shall not take any action or omit to take any action, which action or omission would cause its Revenue Bond or the Bonds (assuming solely for this purpose that the proceeds of the Bonds loaned to the Parlicipant represent ail of the proceeds of the Bonds) to be "private activity bonds" within the meaning of Section 141(a) of the Code. Accordingly, unless the Parlicipant receives the prior written approval of the Issuer, the Parlicipant shall not (A) permit any of the proceeds of the Bonds loaned to the Participant or the Project firlanced with such proceeds to be used, either directly or . indirectly, in any manner that would constitute "private business use" within the meaning of Section 141(bX6) of the Code, taking into account for this purpose all such use by persons other than governmental units on an aggregate basis, (B) use, either directly or indirectly, any of the proceeds of the Bonds loaned to the Participant to make or finance loans to persons other than goveffrnental units (as such term is used in Section 141(c) of the Code) or (C) use, either directly or indirectly, any of the proceeds of the Bonds loaned to the Participant to acquire any "non-governmental output properly" within the meaning of Section 141(d)(2) ofthe Code. (c) The Participant shall not directly or indirectly use or permit the use of any proceeds of the Bonds (or amounts replaced with such proceeds) or any other funds or take any action or omit to take any action, which use or action or omission would (assuming solely for this purpose that the proceeds of the Bonds loaned to the Participant represent all of the proceeds of the Bonds) cause the Bonds to be "arbitrage bQnds" within the meaning of Section 148(a) of the Code. (d) The Participant shall not directly or indirectly use or permit the use of any proceeds of the Bonds to pay the principal of or interest on any issue of State or local governmental obligations ("refinancing of indebtedness") unless the Participant shall establish to the satisfaction of the Issuer that such refinancing of indebtedness will not adversely affect the exclusion from gross income of interest on the Bonds for federal income tax purposes and the Parlicifant delivers an opinion to such effect of bond counsel acceptable to the Issuer. (e) The Participant shall not directly or indirectly use or permit the use of any proceeds of the Bonds to reimburse the Participant for any portion of the cost of the Project unless such cost was paid or incurred by the Participant in anticipation of reimbursement from the proceeds of the Bonds or other State or local governmental bonowing in accordance with the Code, published rulings of the Internal Revenue Service and the Regulations. (0 The Participant shall not use the proceeds of the Bonds (assuming solely for this purpose that the proceeds of the Bonds loaned to the Participant represent all of the 5 proceeds of the Bonds) in any manner which would cause the Bonds to be "federally guaranteed" within the meaning of Section 1a9@) of the Code or "hedge bonds" within the meaning of Section IagG) of the Code. (g) The Participant shall comply with all provisions of the Code relating to the rebate of uny profits from arbitrage attributable to the Participant, and shall indemnify and hold the Issuer harmless therefrom. Section 9. Insurance; Audits: Disposal of Property. The Participant covenants and agrees (a) to maintain insurance on, or to self-insure, the insurable porlions of the Water System ol a kind and in an amognt which normally would be carried by private companies engaged in a similar type of business, (b) to keep proper books and accounts adapted to the Water System, showing the complete and correct entry of all transactions relating thereto, and to cause said books and accounts to be audited or examined by an independent auditor or the State Auditor (i) at such times and for such periods as may be required by the federal Single Audit Act of 1984, OMB Circular A-133 or State law, and (ii) at such other times and for such other periods as may be requested at any time and from time to time by the Issuer (which requests may require an audit to be performed for a period that would not otherwise be required to be audited under State law), and (c) not to sell, lease or in any manner dispose of the Water System, or any capital part thereof, including any and all extensions and additions which may be made thereto, until the Revenue Bond shall have been paid in full or otherwise discharged as provided in the Resolution; provided, however, that the Participant may dispose of any property which in the judgment of its governing body is no longer useful or profitable to use in connection with the operation of the Water System or essential to the continued operation thereof' Section 10. Maintenance of Documents: Access. The Participant agrees to maintain its project accounts in accordance with generally accepted accounting principles ("GAAP") as issued ty ifr. Governmental Accounting Standards Board, including GAAP requirements relating to the reporting of infrastructure assets. The Participant agrees to permit the Issuer or its duly authorized representative access to all files and documents relating to the Project for purposes of conducting audits and reviews in accordance with any of the Regulations. Section 1 1. Continuing Disclosure. As a means of enabling the Issuer to comply with the "continuing disclosure" requirements set forth in Rule l5c2-12 (the "Rule") of the Securities and Exchange Commission, the Participant agtees, during the term of the Loan, to provide the Issuer with (i) the comprehensive audit report of the Participant, prepared and certified by an independent auditor or the State Auditor not later than twelve months after the end of each fiscal year for which the reporl was prepared and (ii) such other information and operating data as the Issuer may reasonably request from time to time with respect to the Water System, the Project or the Participant. The Participant hereby consents to the inclusion of all or any portion of the foregoing information and materials in a public filing made by the Issuer under the Rule. The Participant agrees to indemnify and hold harmless the Issuet, and its officers, directors, employees and agents from and against any and all claims, damages, losses, liabilities, reasonable costs and expenses 6 whatsoever (including attorney fees) which such indemnified party may incur by reason of or in connection with the disclosure of information permitted under this Section; provided that no such indemnification shall be required for any claims, damages, losses, liabilities, costs or expenses to the extent, but only to the extent, caused by the willful misconduct or gross negligence of the Issuer in the disclosure of such information. Section 12. Events of Default. If any one or more of the following events occur, it is hereby defined as and declared to constitute an "Event of Default" under this Agreement: (a) Failure by the Participant to pay, or cause to be paid, any Loan repayment (including the Servicing Fee) required to be paid under this Agreement when due, which failure shall continue for a period of fifteen (15) days. (b) Failure by the Parlicipant to make, or cause to be made, any required payments of principal, redemption premium, if any, and interest on any bonds, notes or other obligations of the Participant (other than the Loan and the Revenue Bond), the payment of which are secured by operating revenues of the Water System. (c) Failure by the Participant to observe and perform any duty, covenant, obligation or agreement on its part to be observed or perfotmed under the Agreement or the Resolution, other than the obligation to make Loan repayments, which failure shall continue for a period of thirty (30) days after written notice, specifying such failure and requesting that it be remedied, is given to the Participant by the Issuer, unless the Issuer shall agree in writing to an extension of such time prior to its expiration or the failure stated in such notice is correctable but cannot be corrected in the applicable period, in which case the Issuer may not unreasonably withhold its consent to an extension of such time up to one hundred twenty (120) days from the delivery of the written notice referecl to above if corrective action is commenced by the Participant within the applicable period and diligently pursued until the Event of Default is corrected' Section 13. Remedies on Default. Whenever an Event of Default shall have occurred and be continuing, the Issuer shall have the right to take any action authorized under the Regulations, the Revenue Bond or this Agreement and to take whatever other action at law or equity may appear necessary or desirable to collect the amounts then due and thereafter to become due under the Agreement or to enforce the performance and observance of any duty, covenant, obligation or agreement of the Participant under the Agreement or the Resolution. Section 14. Amendments. This Agreement may not be amended, supplemented or modified except by a writing executed by all of the parties hereto. Section 15. Termination. The Participant understands and agrees that the Loan may be terminated at the option of the Issuer if construction of the Project has not commenced within one year of the date of execution of this Agreement, all as set forth in the Regulations. Section 16. Rule of Construction. This 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 that statute. l In the event of any inconsistency or conflict between the terms and conditions of the Revenue Bond and this Agreement or the Regulations, the parties acknowledge and agree that the terms of this Agreement or the Regulations, as the case may be, shall take precedence over any such terms of the Revenue Bond and shall be controlling, and that the payment of principal and interest on the Loan shall at all times conform to the schedule set forth on Exhibit A, as adjusted, and the Regulations. Section 17. Federal Requirements. The Partici pant agrees to comply with all applicable federal requirements including, but not limited to, Davis-Bacon wage requirements and the requirements relating to the use of American iron and steel products. Section 18. Repa)rment of Planning and Design Loan. The Participant entered into an Interim Lobn and Disbursement Agreement with the Issuer to provide funds to pay the costs of planning and designing the Project. The Parlicipant agrees to repay the Interim Loan and Disbursement Agreement on the date of this Agreement. Unless the Participant notifies the Issuer that the Participant intends to repay the Interim Loan and Disbursement Agreement from other funds, and the Issuer has received such other funds from the Participant on the date hereof, the Issuer shall be authorized to deduct the full amount due under the Interim Loan and Disbursement Agreement from the proceeds of the Loan being made hereunder, and such deduction by the Issuer shall be deemed to be an expenditure by the Participant of the Loan proceeds. 8 IN WITNESS WHEREOF, we have hereunto affixed our signatures all as of the date first above written. CITY OF DUBUQ IOWA 0,lJ Attest: City By: Mayor fParticipant Signature Page to LDA] IN WITNESS WHEREOF, we have hereunto affixed our signatures all as of the date first above written. IOWA FINANCE AUTHORITY [IFA Signature Page to LDA] 01605147 -t\10422-197 EXHIBIT A ESTIMATED DISBURSEMENTS AND DEBT SERVICE REPAYMENT SCHEDULE A-1 Estimated Amortization Sched ule City of Dubuque Water Revenue Bond FS-31-19-DWSRF-014 Loan Closing Final Disbursement lnitiotion Fee - Aug 9, 2019 P&DPoyoff- Aug9'2019 Estimo'ied Drow #l- Aug 9,2019 Estimoted Drow #2- SeP 27,2019 Estimoled Drow #3- Nov 15,2019 Estimoted Drow #4- Jon 3,2020 Eslimoted Drow #5- Feb 2l,2O2O Estimoted Drow #6- APr'10.2020 Estimoled Drow #7- MoY 29,2020 Eslimoted Drow #8- Jul 17 ,2020 Estimoled Drcw #9- SeP 4,2020 Eslimoted Drow #10- Oc|23,2020 Held for Finol Docs - Nov 20,2020 Tolol Looned Amounl SRF STATE fii!',ri]|vli\;6 !Llllrj Final Maturity Date Loan Period in Years Total Loaned 0.5% lnitiation Net Proceeds to Annual lnterest Total Servicing Fee Rate Total Servicing Fees Total Loan Costs Auq 9, 20'19 Nov 20, 2020 Jun 1,2o4o 20 $ 4,400,000.00 22,000.00 $ 4,378,000.00 1.75% $ 878,081.77 0.25% $ 125,440.26 $ 1,025,522.03 22,000.00 444,162.62 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 375,583.74 37s,583.74 178,000.00 4,400,000.00 Principal I nterest Servicing Total Loan Fee Pavment Total Annual Debt Service EndingPaymentBeginning Balance BalanceDate Dec 1, 2019 1,217,330.10 5,751'32 821'62 6'572'94 1'217'330''10 Dec 1 ,2020 4,222,OOO OO 31,848'65 4'549'81 36'398 46 4'222'000 00 Dec1,2O21 4,219,000.00 36,916'25 5'273'75 42'190'OO 4'219'000'00 Jun 1,2022 1,?19,oog.og 185,000.00 36!916 ?5 5'2!3:75 227 19o 99 269'380'00 4 0?t'qgq:90 Dec 1 , 2022 4,O34,OOO.OO 35,297 50 5'042 50 40'340 00 4'034'000'00 Dec 1,2023 3,846,000.00 33,652 50 4'807 50 38'460 00 3'846'000 00 Dec 1 , 2024 3,654,000.00 31 '972 50 4'567'50 36'540 00 3'654'000 00 Dec 1 ,2025 3,458,000.00 30,257 '5O 4'322 50 34'580 00 3'458'000 00 Dec 1, 2026 3,258,000.00 28,507 50 4'O725O 32'5BO'OO 3'258'000 00 Dec1,2O27 3,054,000.00 26,722'50 3'817'50 30'540'00 3'054'000'00 Dec 1,2028 2,846,000.00 24,902'50 3'557'50 28'460 00 2'846'000'00 Dec 1, 2029 2,634,000.00 ?3,047 '50 3'292 50 26'340 oo 2'634'000'00 Dec 1 , 2030 2,41 8,000.00 21 '1ii .5O 3'022 50 24', 1 80 00 2'41 8'000'00 Dec1,2O31 2,197,000.00 1g,2'3]s 2,746'25 21',970'00 2',197',000 00 Dec1,2O32 1,972,000.00 17'255'OO 2'465'00 19'720'00 1'972'000 00 Dec 1, 2033 1,742,OOO.oo 15'242'50 2'177 '5O 17 '420'OO 1'742'000 00 Dec 1, 2034 1,5O8,OOO.OO 13'195 00 1'885 00 15'OBO OO 1'508'000'00 Dec1,2035 1,269,000.00 11'10375 1'58625 '12'69000 1'269'00000 Dec 1,2036 1,O25,OOOoO 8'968'75 1'281'25 'IO'25OOO 1'025'00000 Dec 1. 2037 776,000.00 6,790'00 97O OO 7'760 00 776'000'00 176p00:oo 523,000.00 26_0r760.q0,._ 5,230.00 268,520.00 123rgg0:0q 523,000.00 ._,. __264,000.00-_- _ 264,000.00 0.00 Jun 1 , 2038 Dec 1, 2038 Iu!', !, ?099 Dec 1, 2039 Jun 1, 2040 253,000.00 6,790.00 4,576.25 4,576.25 970.00 bcJ. / c 653.75 269,460.00 .q?3r009!0_259 330.00264,000.00 2,310.00 As of 6/28/2019 2_6,1!00:ojoq _26410,00:00 2'3119 90 330:00 2,640.00 .00 INVESTING IN IOWA'S WAIER w.iowasrf.com DELIVERY CERTIFICAT]] We, the undersigned City officials, do hereby certify that we are the officers, respectively below indicated, of a municipal corporation in the State of lowa, known as the City of Dubuque, Iowa; that in pursuance of the provisions of Sections 384.24A and 384.83, Code of Iowa, there have been heretofore lawfully authorized and this day by us lawfully executed, issued, caused to be registered and authenticated and delivered one fully registered Water Revenue Capital Loan Note, Series 2019, of said City of Dubuque, Iowa, in the amount of $4,400,000, dated the date of delivery, bearing interest at the rate of I.75% per annum set forth on the Debt liervice Schedule attached hereto and incorporated herein by this reference. The Note has been executed with the manual signature of the Mayor and the manual signature of the Clerk of said City The Note has been delivered to: Iowa Finance Authority of Des Moirres, Iowa, and has been paid for in accordance with the terms of the contract of sale and aLt a price of par. We further certify that no controversy or litigation is pending, prayed or threatened involving the incorporation, organization, existence or boundaries of the City, or the titles of the undersigned officers to their respective positions, or the validity of the Note, or the pledge of the Net Revenues of the municipal water system, (the "Utility"), to the payment of'the Note or the power and duty of the City to construct, own and operate its Utility as a revenue producing undertaking and to provide, charge and apply adequate rates and charges for the full and prompt payment of the principal and interest of the Note, and that none of the proceedings or authority for the issuance of the Note has been repealed, revoked, rescinded, or modifieclin arty manner. We further certify that each of the officers whose signatures appear on the Note were in occupancy and possession of their respective offices at the time the Note was executed and do hereby adopt and affirm their signatures appearing in the Note. We further certify that the present financial condition of the City is as follows: Total water revenue bonded indebtedness, including above-mentioned Water Revenue Capital Loan Note A11 other indebtedness of any kind, payable from Water Revenues $ i, t,1t3 00o * MJP^Vtuht- aO Donils W","q PatA fttt V,;AW YCOt.nq'f > $)9 : .# lalolt t 5'7A Ottutn U VlraLI P*,chLsu Iqlfrq P^t AUJ v!s I Puver LA +( 4 5 634 ,87 tol qt* Ara,u,n fe,il b,oooPoo IN WITNESS WHEREOF, we have hereunto affixed our hands at Dubuque,Iowa, this day of L'urttnl-t9.--u 0 Mayor City Clerk Director & (SEAL) 0160517 s-t\10422-197 TRANSCzuPT CERTIFICATE I, the undersigned, being first duly sworn, do hereby depose and cerlifli that I am the duly appointed, qualified and acting Clerk of the City of Dubuque, Iowa, and that as such Clerk I have in my possession or have access to the complete corporate records of said City and of its City Council and officials, and that I have carefully compared the transcript hereto attached with the aforesaid corporate records and that said transcript hereto attached is a true and complete copy ofall the corporate records in relation to the authoriza/cion, issuance and disposition of a $4,400,000 Water Revenue Capital Loan Note, Series 2019, of said Clty dated the date of delivery, and that said transcript hereto attached contains a true and complete statement of all the measures adopted and proceedings, acts and things had, done and performed up to the present time, in relation to the authorization, issuance and disposition of said Note, and that said City Council consists of a Mayor and six (6) Council Members, and that said offices were duly and lawfully filled by the individuals listed in the attached transcript as of the dates and times referred to therein. I further certifl; that said City is and throughout the period of said proceedings has been governed under tlre Mayor/Council form of municipal government authorized by Chapter 372, Code of Iowa, under the provisions of its charter as recorded with the Secretary of State. I furlher certifu that all meetings of the Cify Council of said City at which action was taken in connection with said Note were open to the public at all times in accordance with a notice of meeting and tentative agenda, a copy of which was timely served on each member of the City Council and was duly given at least twenty-four hours prior to the commencement of the meeting by notification of the communications media having requested such notice and posted on a bulletin board or other prominent place designated for the purpose and easily accessible to the public at the principal office of the City Council all pursuant to the provisions and in accordance with the conditions of the local rules of the City Council and Chapter 2l,Code of Iowa. I further certify that no City officer or employee has any interest in the contract for the sale of the Note or any matter incidental thereto, according to.my best knowledge and belief.4my hand and the seal of the City hereto attached this 2019, at Dubuque, Iowa. day of Cify ity of Dubuque, State of Iowa (SEAL) 1 Finally, the below stated officers whose signatures appear hereafter are now the duly qualified and acting officials of the City, possessed of the offices as designated below, to-wit: Mayor Roy Buol Signature) City Clerk Kevin Director of Finance & Budget Jenny Lars STATE OF IOWA COUNTY OF DUBUQUE Subscribed and sworn to before me by Roy Buol, Kevin Firnstahl and Jenny Larson on this t5F-day of <.\t- I ) SS ) ) ) rr'l ,2019. Notary Public in and for Dubuque County,Iowa (sEAr,) I '€asHt 01605146-t\r0422-r97 a-L- TAX EXEMPTION CERTIFICATE THE CITY OF DUBUQUE,IOWA THIS TAX EXEMPTION CERTIFICATE is made and entered into on August 9,2019,by the City of Dubuque, State of Iowa (the "Issuer"). INTRODUCTION This Certificate is executed and delivered in connection with the issuance by the Issuer of its $4,400,000 Water Revenue Capital Loan Note, Series 2019 (the "Bonds"). The Bonds are issued pursuant to the provisions of the Resolution of the Issuer authorizing the issuance of the Bonds. Such Resolution provides that the covenants contained in this Certificate constitute apart of the Issuer's contract with the owners of the Bonds' The Issuer recognizes that under the Code (as defined below) the tax-exempt status of the interest received by the owners of the Bonds is dependent upon, among other things, the facts, circumstances, and reasonable expectations of the Issuer as to future facts not in existence at this time, as well as the observance of certain covenants in the future. The Issuer covenants that it will take such action with respect to the Bonds as may be required by the Code, and pertinent legal regulations issued thereunder in order to establish and maintain the tax-exempt status of the Bonds, including the observance of all specific covenants contained in the Resolution and this Certificate. ARTICLE I DEFINITiONS The following terms as used in this Cerlificate shall have the meanings set forth below. The terms defined in the Resolution shall retain the meanings set forth therein when used in this Certificate. Other terms used in this Certificate shall have the meanings set fofth in the Code or in the Regulations. "Arurual Debt Service" means the principal of and interest on the Bonds scheduled to be paid during a given Bond Year. "Bonds" means the $4,400,000 aggregate principal amount of a Water Revenue Capital Loan Note of the Issuer issued in registered form pursuant to the Resolution. "Bond Counsel" means Ahlers & Cooney, P.C., Des Moines, Iowa, or an attorney at law or a firm of attorneys of nationally recognized standing in matters pertaining to the tax-exempt status of interest on obligations issued by states and their political subdivisions, duly admitted to the practice of law before the highest coufi of any State of the United States of America. 1 "Bond Fund" means the Sinking Fund described in the Resolution. "Bond Year", as defined in Regulation 1.148-1(b), means a one-year period beginning on the day after expiration of the preceding Bond Year. The first Bond Year shall be the one-year or shorter period beginning on the Closing Date and ending on a principal or interest payment date, unless the Issuer selects another date. "Bond Yield" means that discount rate which produces an amount equal to the Issue Price of the Bonds when used in computing the present value of all payments of principal and interest to be paid on the Bonds, using semiannual compounding on a360-day Year as computed under Regulation 1.148-4. "Certificate" means this Tax Exemption Certificate. "Closing" means the delivery of the Bonds in exchange for the agreed upon purchase pnce. "Closing Date" means the date of Closing. "Code" means the Internal Revenue Code of 1986, as amended, and any statutes which replace or supplement the Internal Revenue Code of 1986. "Computation Date" means each five-year period from the Closing Date through the last day of the fifth and each succeeding fifth Bond Year. "Excess Earnings" means the amount earned on all Nonpurpose Investments minus the amount which would have been earned if such Nonpurpose Investments were invested at a ra,te equal to the Bond Yield, plus any income attributable to such excess. "Final Bond Retirement Date" means the date on which the Bonds are actually paid in full "Govenmental Obligations" means direct general obligations of, or obligations the timely payment of the principal of and interest on which is unconditionally guaranteed by the United States. "Gross Procaeds", as defined in Regulation 1.148-1(b), means any Proceeds of the Bonds and any replacement proceeds (as defined in Regulation 1.148-1(c)) of the Bonds- "Gross Proceeds Funds" means the Project Fund and any other fund or account held for the benefit of the owners of the Bonds or containing Gross Proceeds of the Bonds except the Bond Fund and the Rebate Fund. "Issue Price", as defined in Regulation 1.148-1(b), means price paid by the Purchasers of the Bonds. The Purchasers have certified the Issue Price to be $4,400,000. a-.2-- "Issuer" means the City of Dubuque, State of Iowa. "Minor Portion of the Bonds", as defined in Regulation I.I48-2(g), means the lesser of five (5) percent of Proceeds or $100,000. The Minor Portion of the Bonds is computed to be $100,000. "Nonpurpose Investments" means any investment property which is acquired with Gross Proceeds and is not acquired to cany out the governmental purpose of the Bonds, and may include but is not limited to U.S. Treasury bonds, corporate bonds, or certificates of deposit. "Proceeds", as defined in Regulation i.148-1(b), means Sale Proceeds, investment proceeds and transferred proceeds ofthe Bonds. "Project" means the acquisition, construction, reconstruction, extending, remodeling, improving, repairing and equipping all or part of the Municipal Water System, including those costs associated with the Roosevelt Street water tower and water distribution improvements project and the Eagle Point water treatment plant and water distribution improvements project; and refunding the Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017, dated September 22,2071, as more fully described in the Resolution. "Project Fund" means the fund established in the Resolution. "Purchaser" means the Iowa Finance Authority, Des Moines, Iowa, constituting the initial purchaser of the Bonds from the Issuer. "Rebate Amount" means the amount computed as described in this Certificate. "Rebate Fund" means the fund to be created, if necessary, pursuant to this Certificate. "Rebate Payment Date" means a date chosen by the Issuer which is not more than 60 days following each Computation Date or the Final Bond Retirement Date. "Refunded SRF Planning and Design Note" means $444,162.62 of the $475,000 Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017 dated September 22,2017. "Regulations" means the Income Tax Regulations, amendments and successor provisions promulgated by the Department of the Treasury under Sections 103, 148 and 149 of the Code, or other Sections of the Code relating to "arbitrage bonds", including without limitation Regulations 1. 148-1 through 1. 148-1 1, 1. 149(b) -1, 1.149-d(1), 1' 1 50-1 and 1. 1 50-2' "Replacement Proceeds" include, but are not limited to, sinking funds, amounts that are pledged as security for an issue, and amounts that are replaced because of a sufficiently direct nexus to a governmentai purpose of an issue. a-J- "Resolution" means the resolution of the Issuer adopted on July 15,2019 authorizing the issuance of the Bonds. "Sale Proceeds", as defined in Regulation 1.148-1(b), means any amounts actually or constructively received from the sale of the Bonds, inclr,rding amounts used to pay underwriter's discount or compensation and accrued interest other than pre-issuance accrued interest. "Sinking Fund" means the Bond Fund. "Tax Exempt Obligations" means bonds or other obligations the interest on which is excludable from the gross income of the owners thereof under Section 103 of the Code and include certain regulated investment companies, stock in tax-exempt mutual funds and demand deposit SLGS. "Taxable Obligations" means all investment property, obligations or securities other than Tax Exempt Obligations. "Verification Certificate" means the certificate attached to this Certificate as Exhibit A, establishing that the Purchaser will not reoffer or sell the Bonds to the public. ARTICLE II SPECIFIC CERTIFICATIONS, REPRESENTATIONS AND AGREEMENTS The Issuer hereby ceftifies, represents and agrees as follows: Section 2.1 Authorit)'to Certif.v and Expectations (a) The undersigned officer of the Issuer along with other officers of the Issuer, are charged with the responsibility of issuing the Bonds. (b) This Certificate is being executed and delivered in part for the purposes specified in Section 1 .148-2(bX2) of the Regulations and is intended (among other purposes) to establish reasonable expectations of the Issuer at this time. (c) The Issuer has not been notified of any disqualification or proposed disqualification of it by the Commissioner of the Internal Revenue Service as a bond issuer which may certify bond issues under Section 1.148-2(bX2) of the Regulations. (d) The certifications, representations and agreements set forth in this Arlicle II are made on the basis of the facts, estimates and circumstances in existence on the date hereof, -4- including the following: (1) with respect to amounts expected to be received from delivery of the Bonds, amounts actually received, (2) with respect to payments of amounts into various funds or accounts, review of the authorizations or directions for such payments made by the Issuer pursuant to the Resolution and this Certificate, (3) with respect to the Issue Price, the Lertifications of the Purchaser as set forth in the Verification Certificate, (4) with respect to expenditure of the proceeds of the Bonds, actual expenditures and reasonable expectations of the Iszuer as to when the Proceeds will be spent for purposes of the Project and (5) with respect to Bond Yield, review of the Verification Certificate. The Issuer has no reason to believe such facts, estimates or circumstances are untrue or incomplete in any materialway. (e) To the best of the knowledge and belief of the undersigned officer of the Issuer, there are no facts, estimates or circumstances that would materialiy change the representations, certifications or agreements set forth in this Certificate, and the expectations herein set out are reasonable. (f) No arrangement exists under which the payment of principal or interest on the Bonds would be directly or indirectly guaranteed by the United States or any agency or instrumentality thereof. (e)After the expiration of any applicable temporary periods, and excluding investments in a bona fide debt service fund or reserve fund, not more than five (s%) of the Proceeds of the Bonds will be (a) used to make loans which are guaranteed by United States or any agency or instrumentality thereof, or (b) invested in federally accounts. deposits or (h) The Issuer will file with the Internal Revenue Service in a timely fashion Form 8038-G,Information Return for Tax-Exempt Governmental Obligations, with respect to the Bonds and such other reports required to comply with the Code and applicable Regulations. (i) The Issuer will take no action which would cause the Bonds to become "private activity bonds" as defined in Section l4l(a) of the Code, including any use of the Project by uny person other than a governmental unit if such use will be as other than a member of the general public. None of the Proceeds of the Bonds will be used directly or indirectly to make or finance loans to any person other than a governmental unit. 11) The Issuer will make no change in the nature or purpose of the Project except as provided in Section 6.1 hereof. (k) Except as provided in Section 6.1 hereof, the Issuer will not establish any sinking fund, bond fund, reserve fund, debt service fund or other fund reasonably expected to be used to pay debt service on the Bonds (other than the Bond Fund), exercise its option to redeem Bonds prior to maturity or effect a refunding of the Bonds' -5- (l) No bonds or other obligations of the Issuer (1) were sold in the 15 days preceding the date of sale of the Bonds, (2) were sold or will be sold within the i 5 days after the date of sale of the Bonds, (3) have been delivered in the past 15 days or (4) willbe delivered in the next 15 days pursuant to a common plan of financing for the issuance of the Bonds and payable out of substantially the same source of revenues. (m) None of the Proceeds of the Bonds will be used directly or indirectly to replace funds of the Issuer used directly or indirectly to acquire obligations having a yield higher than the Bond Yield. (n) No portion of the Bonds will be issued for the purpose of investing such portion at a higher yield than the Bond Yield. (o) The Issuer does not expect that the Proceeds of the Bonds will be used in a manner that would cause them to be "arbitrage bonds" as defined in Section 1a8(a) of the Code. The Issuer does not expect that the Proceeds of the Bonds will be used in a manner that would cause the interest on the Bonds to be includable in the gross income of the owners of the Bonds under the Code. The Issuer will not intentionally use any portion of the Proceeds to acquire higher yielding investments. (p) The Issuer will not use the Proceeds of the Bonds to exploit the difference between tax-exempt and taxable interest rates to obtain a material financial advantage. (q) The Issuer has not issued more Bonds, issued the Bonds earlier, or allowed the Bonds to remain outstanding longer than is reasonably necessary to accomplish the governmental purposes of the Bonds. G) The Issuer has not employed a device in connection with the issuance of the Bonds to obtain a material financial advantage (based on arbitrage) apart from savings attributable to lower interest rates. The Issuer will not realize any material financial advantage (based on arbitrage or otherwise) in connection with the issuance of the Bonds, or in connection with any transaction or series of transactions connected with the issuance of the Bonds, apart from savings attributable to lower interest rates. (s) The Bonds will not be Hedge Bonds as described in Section 1a9(gX3) of the Code because the Issuer reasonably expects that it will meet the Expenditure Test set forth in Section 2.5(b) hereof and that not more than 50Yo of the Proceeds will be invested in Nonpurpose Investments having a substantially guaranteed yield for four or more yeafs. tures of S Sale Proceeds received at Closing are expected to be deposited and expended as follows: 2 -6- (a)$34,000 representing costs of issuing the Bonds and the Initiation Fee fbr the Loan will be used within six months of the Closing Date to pay the costs of issuance of the Bonds (with any excess remaining on deposit in the Project Fund); $3,921,837.38 will be available to be deposited into the Project Fund and wil1be used together with earnings thereon to pay the costs of the Project and'will not exceed the amount necessaly to accomplish the governmental purposes of the Bonds; and $444,162.62 will be used together with earnings thereon to pay the principal amount drawn on the Refunded SRF Plaruring and Design Note, which will be redeemed on August 9,201,9. (b) (c) Section 2.3 se of Bonds The Issuer is issuing the Bonds to pay costs of the acquisition, construction, reconstruction, extending, remodeling, improving, repairing and equipping all or parl of the Municipal Water System, including those costs associated with the Roosevelt Street water tower and water distribution improvements project and the Eagle Point water treatment plant and water distribution improvements project; and refunding the Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017, dated September 22,20IJ, in order to implement long- term financing for the Project. onC The Bonds are considered to be governmental bonds, not subject to the provisions of the alternate minimum tax. Proceeds of the Bonds will be used for the purpose of paying costs of the project. All of the financed facilities are owned by the City and are expected to be used by the public generally, including commercial and industrial users. There are no contractual affangements or agreements between the City and any commercial or industrial user of the Water Utility, and there are no other lease, management contract or other similar arrangements with respect to the Water Utility. Commercial or industrial users of the Water Utility may be or beCome subject to different rates or charges than those imposed on residential custoners, depending on the volume of the water they purchase. All such charges, however, are or will be imposed by virtue of City ordinances applicable to all entities meeting the standards set forth therein. No other charges or payments will be imposed or paid to the City by any contributing industry for water services or Project-related construction and acquisition beyond those mandated by ordinance for ceftain classes ofusers. No amount of Proceeds of the Bonds or the Refunded SRF Planning and Design Note is to be used or were directly or indirectly to make or finance loans to persons other than governmental units. -7 - 2. (a) Time Test. Not later than six months after the Closing Date, the Issuer will incur a substantial binding obligation to a third party to expend at least 5o/o of the net Sale Proceeds of the Bonds. (b) Expenditure Test. Not less than 85% of the net Sale Proceeds will be expended for Project costs, including the reimbursement of other funds expended to date, within a three-year temporary period from the Closing Date. (c) Due Diligence Test. Not later than six months after Closing, work on the Project will have commenced and will proceed with due diligence to completion' (d) Proceeds of the Bonds representing less than six months accrued interest on the Bonds will be spent within six months of this date to pay interest on the Bonds, and will be invested without restriction as to yield for a temporary period not in excess of six months. 2.6 at nrestri (a) Proceeds of the Bonds will be held and accounted for in the marurer provided in the Resolution. The Issuer has not and does not expect to create or establish any other bond fund, reserve fund, or similar fund or account for the Bonds. The Issuer has not and will not pledge any moneys or Taxable Obligations in order to pay debt service on the Bonds or restrict the use of such moneys or Taxable Obligations so as to give reasonable assurances of their availability for such purposes. (b) Any monies which are invested beyond a temporary period are expected to constitute less than a major portion of the Bonds or to be restricted for investment at a yield not greater than one-eighth of one percent above the Bond Yield. (c) The Issuer has established and will use the Bond Fund primarily to achieve a proper matching of revenues and debt service within each Bond Year and the issuer will apply -on"yr deposited into the Bond Fund to pay the principal of and interest on the Bonds. Such Fund will be depleted at least once each Bond Year except for a reasonable carryover amount' The carryover amount will not exceed the greater of (1) one year's earnings on the Bond Fund or (2) one-twe|fth of Annual Debt Service. The Issuer will spend moneys deposited from time to time into such fund within 13 months after the date of deposit. Revenues, intended to be used to pay debt service on the Bonds, will be deposited into the Bond Fund as set forth in the Resolution. Th. I5n"t will spend interest earned on moneys in such fund not more than 12 months after receipt. Accordingly, the Issuer will treat the Bond Fund as a bona frde debt service fund as defined in Regulation 1.148-1(b). P -8- Investment of amounts on deposit in the Bond Fund will not be subject to arbitrage rebate requirements as the Bonds meet the safe harbor set forth in Regulation 1.148-3(k), because the uu"rug. annual debt service on the Bonds will not exceed $2,500,000 (d) The Minor Portion of the Bonds will be invested without regard to yield. Section 2.7 Pertaining to Yields (a) The purchase price of all Taxable Obligations to which restrictions apply under this Certificate as to investment yield or rebate of Excess Earnings, if any, has been and shall be calculated using (i) the price taking into account discount, premium and accrued interest, as applicable, actually paid or (ii) the fair market value if less than the price actually paicl and if such Taxable Obligationr *.t. not purchased directly from the United States Treasury. The Issuer will acquire all such Taxable Obligations directly from the United States Treasury or in an arm's length transaction without regard to any amounts paid to reduce the yield on such Taxable Obligations. The Issuer will not pay or permit the payment of any amounts (other than to the United States) to reduce the yield on any Taxable Obligations. Obligations pledged to the payment of debt service on the Bonds, or deposited into any reserve fund after they have been acquired by the Issuer will be treated as though they were acquired for their fair market value on the date of such pledge or deposit. Obligations on deposit in any resen'e fund on the Closing Date shall be treated as if acquired for their fair market value on the Closing Date. (b) Qualified guarantees have not been used in computing yield. (c) The Bond Yield has been computed as not less than I.750058% percent. This Bond Yield has been computed on the basis of a purchase price for the Bonds equal to the Issue Price. ARTICLE III REBATE Section 3.1 Records Sale Proceeds of the Bonds will be held and accounted for in the manner provided in the Resolution. The Issuer will maintain adequate records for funds created by the Resolution and this Certificate including all deposits, withdrawals, transfers from, transfers to, investments, reinvestments, sales, purchases, redemptions, liquidations and use of money or obligations until six years after the Final Bond Retirement Date. Section 3.2 Rebate Fund -9 - (a) In the Resolution, the Issuer has covenanted to pay to the United States the Rebate Amount, an amount equal to the Excess Earnings on the Gross Proceeds Funds, if any, at the times and in the manner required or permitted and subject to stated special rules and allowable exceptions or exemptions. (b) The Issuer may establish a fund pursuant to the Resolution and this Certificate which is herein referred to as the Rebate Fund. The Issuer will invest and expend amounts on deposit in the Rebate Fund in accordance with this Cerlificate. (c) Moneys in the Rebate Fund shall be held by the Issuer or its designee and, subject to Sections 3.4,3.5 and 6.1 hereof, shall be held for future payment to the United States as contemplated under the provisions of this Certificate and shall not constitute part of the trust estate held for the benefit of the,owners of the Bonds or the Issuer. (d) The Issuer will pay to the United States from legaliy available money of the Issuer (whether or not such available money is on deposit in any fund or account related to the Bonds) any amount which is required to be paid to the United States. -t.-) The Issuer reasonably expects that the Bonds are eligible for one or more exemptions from the arbitrage rebate rules set forth in the Treasury Regulations. If the Bonds are ineligible, or become ineligible, for an exemption to the arbitrage rebate rules, the Issuer will comply with the provisions of Article III hereof. A description of the applicable rebate exemption(s) is as follows: . Eighteen-Month ExemPtion The Gross Proceeds of the Bonds are expected to be expended for the governmental purposes for which the Bonds were issued in accordance with the following schedule: 15 percent spent within six months of the Closing Date; 60 percent spent within one year of the Closing Date; i00 percent spent within eighteen months of the Closing Date (subject to 5 percent retainage for not more than one year). 1) 2) 3) In any event, the Issuer expects that the 5o% reasonable retainage will be spent within 30 months of the Closing Date. For purposes of determining compliance with the six-month and twelve- month spending periods, the amount of investment earnings included shall be based on the Issuer's reasonable expectations that the average annual interest rate on investments will be not more than 6.0%. For purposes of determining compliance with the eighteen-month spending period, the amount of investment earnings included shall be based on actual earnings. If the Issuer fails to meet the foregoing expenditure schedule, the Issuer shall comply with the arbitrage rebate requirements of the Code. -10- Election to Treat as Construction Bonds. The Bonds qualify as a "construction issue" as defined in Section 148(fX4XC)(vi) of the Code. The Issuer reasonably expects that more than 7 5 percent of the "available construction proceeds" ("ACP") of the Bonds, as defined in Section 148(0(4XC)(vi) of the Code, will be used ior construction expenditures and that not less than the following percentages of the available construction proceeds will be spent within the following periods: 1) 10 percent spent within six months of the Closing Date 2) 45 percent spent within one year of the Closing Date 3) 75 percent spent within eighteen months of the closing Date 4) 100 percent spent within two years of the Closing Date (subject to 5 percent retainage for not more than one year) In any event, the Issuer expects that the 50% reasonable retainage will be spent within a three-year period beginning on the Closing Date. A failure to spend an amount that does not exceed the i"rr", of (r) 3% of the issue price or (ii) $250,000, is disregarded if the Issuer exercises due diligence to complete the Project. . Election with respect to future earnings Pursuant to Section 1.148-7(0(2) of the Regulations, the Issuer elects to use actual investment earnings of the ACP in determining compliance with the above schedule. If the Issuer fails to meet the foregoing expenditure schedule, the Issuer shall comply with the arbitrage rebate requirements of the Code. 3.4 of (a) As soon after each Computation Date as practicable, the Issuer shall, if necessary, calculate and determine the Excess Earnings on the Gross Proceeds Funds (the "Rebate Amount"). All calculations and determinations with respect to the Rebate Amount willbe made on the basis of actual facts as of the Computation Date and reasonable expectations as to future events. (b) If the Rebate Amount exceeds the amount currently on deposit in the Rebate Fund, the Issuer may deposit an amount in the Rebate Fund such that the balance in the Rebate Fund after such deposit equals the Rebate Amount. If the amount in the Rebate Fund exceeds the Rebate Amount, the Issuer may withdraw such excess amount provided that such withdrawal can be made from amounts originally transferred to the Rebate Fund and not from earnings thereon, which may not be transferred, and only if such withdrawal may be made without liquidating investments at a loss. Bond Fund - 11- Section 3.5 ebate Reouirements and It is expected that the Bond Fund described in the Resolution and Section 2.7(b) of this Certificate will be treated as a bona fide debt service fund as defined in Regulation 1.148-1(b). As such, any amount earned during a Bond Year on the Bond Fund and amounts earned on such amounts, if allocated to the Bond Fund, will not be taken into account in calculating the Rebate Amount if the annual gross earnings on the Bond Fund for such Bond Year are less than $100,000 or if average annual debt service will not exceed $2,500,000. However, should annual gross earnings exceed $100,000 or should the Bond Fund cease to be treated as a bona fide debt service fund, the Bond Fund will become subject to the rebate requirements set forth in Section 3.4 hereof. Section 3.6 of the Rebate Fund (a) Immediately upon a transfer to the Rebate Fund, the Issuer may invest all amounts in the Rebate Fund not already invested and held in the Rebate Fund, to the extent possible, in (1) SLGS, such investments to be made at a yield of not more than one-eighth of one percent above the Bond Yield, (2)TaxExempt Obligations, (3) direct obligations of the United States or (4) certificates of deposit of any bank or savings and loan association. All investments in the Rebate Fund shall be made to mature not later than the next Rebate Payment Date. (b) If the Issuer invests in SLGS, the Issuer shall file timely subscription fotms for such securities (if required). To the extent possible, amounts received from maturiiig SLGS shall be reinvested immediately in zero yield SLGS maturing on or before the next Rebate Payment Date. Section 3.7 Pa)'ment to the United States (a) On each Rebate Payment Date, the Issuer will pay to the United States at least ninety percent (90%) of the Rebate Amount less a computation credit of $ 1,000 per Bond Year for which the payment is made. (b) The Issuer wiil pay to the United States not later than sixty (60) days after the Final Bond Retirement Date all the rebatable arbitrage as of such date and any income attributable to such rebatable arbitrage as described in Regulation 1.148-3(0(2). (c) If necessary, on each Rebate Payment Date, the Issuer will mail a check to the Internal Revenue Service Center, Ogden, UT 84201. Each payment shall be accompanied by a copy of Form 8038-T, Arbitrage Rebate, filed with respect to the Bonds or other information reporting form as is required to comply with the Code and applicable Regulations. Section 3.8 Records (a) The Issuer will keep and retain adequate records with respect to the Bonds, the Gross Proceeds Funds, the Bond Fund and the Rebate Fund until six years after the Final Bond -12- Retirement Date. Such records shall include descriptions of all calculations of amounts transferred to the Rebate Fund, if any, and descriptions of all calculations of amounts paid to the United States as required by this Cerlificate. Such records will also show all amounts earned on moneys invested in such funds, and the actual dates and amounts of all principal, interest and redemption premiums (if any) paid on the Bonds. (b) Records relating to the investments in such Funds shall completely describe all transfers, deposits, disbursements and earnings including: (D a complete list of all investments and reinvestments of amounts in each such Fund including, if applicable, purchase price, purchase date, type of security, accrued interest paid, interest rate, dated date, principal amount, date of maturity, interest payment dates, date of liquidation, receipt upon liquidation, market value of such investment on the Final Bond Retirement Date if held by the Issuer on the Final Bond Retirement Date, and market value of the investment on the date pledged to the payment of the Bonds, or the Closing Date if different from the purchase date. (ii) the amount and source of each payment to, and the amount, putpose and payee of each payment from, each such Fund. 3.9 Addi The Issuer hereby agrees to pay to the United States from legally available money of the Issuer (whether or not such available money is on deposit in any fund or account related to the Bonds) any amount which is required to be paid to the United States, but which is not available in a fund related to the Bonds for transfer to the Rebate Fund or payment to the United States. ARTICLE IV INVESTMENT RESTRICTIONS 4.r ited The Issuer will not enter into any transaction that reduces the amount required to be deposited into the Rebate Fund or paid to the United States because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction had been at arm's length and had the Bond Yield not been relevant to either party. The Issuer will not invest or direct the investment of any funds in a manner which reduces an amount required to be paid to the United States because such transaction results in a small profit or larger loss than would have resulted if the transaction had been at arm's length and had the Bond Yield not been relevant to the Issuer. In particular, notwithstanding anything to the contrary contained herein or in the Resolution, the Issuer will not invest or direct the investment of any funds in a manner which would violate any provision of this Article IV. - 13 - Section 4.2 Market Price Requirement (a) The Issuer will not purchase or direct the purchase of Taxable Obligations for more than the then available market price for such Taxable Obligations. The Issuer will not sell, liquidate or direct the sale or liquidation of Taxable Obligations for less than the then available market price. (b) For purposes of this Certificate, United States Treasury obligations purchased directly from the United States Treasury will be deemed to be purchased at the markel. price. Section 4.3 Investment in Certificates (a) Notwithstanding anything to the contrary contained herein or in the Resolution, the Issuer will invest or direct the investment of funds on deposit in the Gross Proceeds Fund, the Bond Fund, and the Rebate Fund, in a certificate of deposit of a bank or savings bank which is permitted by law and by the Resolution only if (1) the price at which such certificate of deposit is purchased or sold is the bona fide bid price quoted by a dealer who maintains an active secondary market in certificates of deposit of the same type or (2) if there is no active secondary market in such cerlificates of deposit, the certificate of deposit must have a yield (A) as high or higher than the yield on comparable obligatibns traded on an active secondary market, as certified by a dealer who maintains such a market, and (B) as high or higher than the yield available on comparable obligations of the United States Treasury. (b) The certificate of deposit described in part 2(A) of paragraph a.3(a) above must be executed by a dealer who maintains an active secondary market in comparable certificates of deposit and must be based on actual trades adjusted to reflect the size and term of that certificate of deposit and the stability and reputation of the bank or savings bank issuing the certificate of deposit. Section 4.4 Investment Pursuant to Investment Contracts and Agreements The Issuer will invest or direct the investment of funds on deposit in the Gross Proceeds Funds, the Bond Fund, and the Rebate Fund pursuant to an investment contract (including a repurchase agreement) only if all of the following requirements are satisfied: (a) The Issuer makes a bona fide solicitation for the purchase of the investment. A bona fide solicitation is a solicitation that satisfies all of the following requirements: : (1) The bid specifications are in writing and are timely forwarded to potential providers. -14- (2) The bid specifications include all material terms of the bid. A term rs material if it may directly or indirectly affect the yield or the cost of the investment. (3) The bid specifications include a statement notifying potential providers that submission of a bid is a representation that the potential provider did not consult with any other potential provider about its bid, that the bid was determined without regard to any other formal or informal agreement that the potential provider has with the issuer or any other person (whether or not in connection with the Bonds), and that the bid is not being submitted solely as a courtesy to the issuer or any other person for purposes of satisfying the requirements of paragraph (dX6XiiiXB)(1) or (2) of section 1.148-5 of the Regulations. (a) The terms of the bid specifications are commercially reasonable. A term is commercially reasonable if there is a legitimate business pulpose for the term other than to increase the purchase price or reduce the yield of the investment. (5) For purchases of guaranteed investment contracts only, the terms of the solicitation take into account the Issuer's reasonably expected deposit and drawdown schedule for the amounts to be invested' (6) All potential providers have an equal opportunity to bid and no potential provider is given the opportunity to review other bids (i.e., a last look) before providing a bid. (7) At least three reasonably competitive providers are solicited for bids. A reasonably competitive provider is a provider that has an established industry reputation as a competitive provider of the type of investments being purchased. (b) The bids received by the Issuer meet all of the following requirements: (1) The Issuer receives at least three bids from providers that the Issuer solicited under a bona fide solicitation meeting the requirements of paragraph (dX6XiiiXA) of section 1.148-5 of the Regulations and that do not have a material financial interest in the issue. A lead underwriter in a negotiated underwriting transaction is deemed to have a material financial interest in the issue untii 15 days after the issue date of the issue. In addition, any entity acting as a financial advisor with respect to the purchase of the investment at the time the bid specifications are forwarded to potential providers has a material financial interest in the issue. A provider that is a related party to a provider that has a material financial interest in the issue is deemed to have a material financial interest in the issue. (2) At least one of the three bids described in paragraph (dX6XiiiXBXl) of section 1.148-5 of the Regulations is from a reasonably competitive provider, -15- within the meaning of paragraph (d)(6)(iiixAxT) of section 1.148-5 of the Regulations. (3) If the Issuer uses an agent to conduct the bidding process, the agent did not bid to provide the investment. (c) The winning bid meets the following requirements: (1) Guaranteed investment contracts. If the investment is a guaranteed investment conttact, the winning bid is the highest yielding bona fide bid (determined net of any broker's fees). (2) Other investments. If the investment is not a guaranteed investment contract, the winning bid is the lowest cost bona fide bid (including any broker's fees). (d) The provider of the investments or the obligor on the guaranteed investment contract certifies the administrative costs that it pays (or expects to pay, if any) to third parties in connection with supplying the investment' (e) The Issuer will retain the following records with the bond documents until three years after the last outstanding bond is redeemed: ( 1) For purchases' of guaranteed investment contracts, a copy of the contract, and for purchases of investments other than guaranteed investment contracts, the purchase agreement or confirmation. (2) The receipt or other record of the amount actually paid by the Issuer for the investments, including a record of any administrative costs paid by the Issuer, and the cefiification under paragraph (dX6XiiiXD) of section 1.148-5 of the Regulations. (3) For each bid that is submitted, the name of the person and entity submitting the bid, the time and date of the bid, and the bid results. (4) The bid solicitation form and, if the terms of the purchase agreement or the guaranteed investment contract deviated from the bid solicitation form or a submitted bid is rnodified, a brief statement explaining the deviation and stating the purpose for the deviation. (5) For purchases of investments other than guaranteed investment contracts, the cost of the most efficient portfolio of State and Local Government Series Securities, determined at the time that the bids were required to be submitted pursuant to the terms of the bid specifications. Section 4.5 Records -t6- The Issuer will maintain records of all purchases, sales, liquidations, investments, reinvestments, redemptions, disbursements, deposits, and transfers of amounts on deposit. Section 4.6 Investments to be Legal A11 investments required to be made pursuant to this Certificate shall be made to the extent permitted by law. In the event that any such investment is determined to be ultra vires, it shall be iiquidated and the proceeds thereof shall be invested in a legal investment, provided that prior to reinvesting such proceeds, the Issuer shall obtain an opinion of Bond Counsel to the elfect that such reinvestment will not cause the Bonds to become arbitrage bonds under Sections 103, 148, 149, or any other applicable provision of the Code. ARTICLE V GENERAL COVENANTS The Issuer hereby covenants to perform all acts within its power necessary to ensure that the reasonable expectations set forth in Article II hereof will be realized. The Issuer reasonably expects to comply with all covenants contained in this Certificate. ARTICLE VI AMENDMENTS AND ADDITIONAL AGREEMENTS Section 6.1 on of Bond Counsel;Amendments The various provisions of this Certificate need not be obsen'ed and this Certificate may be amended or supplemented at any time by the Issuer if the Issuer receives an opinion c,r opinions of Bond Counsel that the failure to comply with such provisions will not cause any of the Bonds to become "arbitrage bonds" under the Code and that the terms of such amendment or supplement will not cause any of the Bonds to become "arbitrage bonds" under the Code, or otherwise cause interest on any of the Bonds to become includable in gross income for federal income tax purposes. 2 Addi The Issuer hereby covenants to make, execute and enter into (and to take such actions, if any, as may be necessary to enable it to do so) such agreements as may be necessary to comply with any changes in law or regulations in order to preserve the tax-exempt status of the Bonds to the extent that it may lawfully do so. The Issuer further covenants (1) to impose such limitations on the investment or use of moneys or investments related to the Bonds, (2) to make such payments to the United States Treasury, (3) to maintain such records, (4) to perform such -t7 - calculations, and (5) to perform such other lawful acts as may be necessary to preserve the tax- exempt status of the Bonds. Section 6.3 Amendments Except as otherwise provided in Section 6.1 hereof, all the rights, powers, duties and obligations of the Issuer shall be inevocable and binding upon the Issuer and shall not be subject to amendment or modification by the Issuer. ARTICLE VII FURTHER CERTIFICATIONS WITH RESPECT TO REFLTNDING BONDS (a) Properly financed with the Proceeds of the Refunded SRF Planning and Design Note will not be sold or disposed of, in whole or in paft, prior to the last maturity date of either the obligations or the last maturity of the Bonds. (b) All of the Proceeds of the Itefunded SRF Planning and Design Note were used to provide facilities used in the regular operations of the Issuer and neither the facilities nor the output thereofhave been or are expected to be used in the trade or business ofany person other than the lssuer. (c) Reimbursement Allocations and Original Expenditures, if any, reimbursed from proceeds of the Refunded SRF Planning and Design Note complied with the Reimbursement Regulations in effect at the time of issuance of the Refunded SRF Planning and Design Note. (d) The Proceeds of the Refunding Bonds will be used for a cunent refunding and the Refunding Bonds are issued not more than 90 days before the last expenditure of any Proceeds of the Refunding Bonds for payment of debt service on the Refunded SRF Planning and Design Note. The Proceeds of the Refunding Bonds will be invested in materially higher yield acquired obligations for a temporary period of not to exceed 90 days. - 18 - IN WITNESS WHEREOF, the Issuer has caused this Certificate to be executed by its duly authorized officer, all as of the day first above written. ofF & Budget, City of Dubuque, State of Iowa (sEAL) -t9- EXHIBIT A VERIFICATION CERTIFICATE OF THE PURCHASER The undersigned the Executive Director of the Iowa Finance Authority (the "Purchaser"), hereby certifies as follows: 1. The Purchaser and the City of Dubuque, Iowa (the "Issuer"), have entered into a Loan and Disbursement Agreement (the "Agreement"), providing for the purchase of a $4,400,000 Water Revenue Capital Loan Note of the City dated as of the date of delivery (the "Notes"). 2. The Agreement is in full force and effect and has not been repealed, rescinded or amended. 3. The Purchaser hereby confirms that the Notes were purchased at par and will not be reoffered to the public, the terms of purchase being as follows: Principal Amount Issued Principal Amount Sold Price (o/o of par) (do not include accrued interest) $4,400,000 None IN WITNESS WHEREOF, thc executed by its duly authorized officer this Interest Rate r.75% caused this V day of IO FINANCE AUTHO r00% Certificate to be 2019. VEI 0r605155-t\l0422-t97 REGISTERED Certificate No. R-l Interest Rate 1.750o/" or registered assigns, the principal sum of DOLLARS in lawfulmoney of the United UNITED STATES OF AMERICA STATE OF IOWA COUNTY OF DUBUQUE CITY OF DUBUQUE WATER REVENUE CAPITAL LOAN NOTE SERIES 2019 Final Maturifv Date June 1,2040 REGISTERED Principal Amount $4,400,000 Note Date August 9,2019 The City of Dubuque, Iowa, a municipal corporation organized and existing under and by virtue of the Constitution and laws of the State of Iowa (the "Issuer"), for value received, promises to pay from the source and as hereinafter provided, to IOWA FINANCE AUTHORITY ONF States of America, on the maturity dates and in the principal amounts set forth on the Debt Service Schedule attached hereto and incorporated herein by this reference, with interest on said sum from the date of each advancement made under a ceftain Loan and Disbursement Agreement dated as of the date hereof until paid at the rate of 1.7 5Yo per annum, payable on December 1,2019, and semi-annually thereafter on the lst day of June and December in each year. As set forth on said Debt Service Schedule, principal shall be payable on June I ,2021and annually thereafter on the first day of June in the amounts set forth therein until principal and interest are fully paid, except that the final installment of the entire balance of principal and interest, if not sooner paid, shall become due and payable on June I,2040. Notwithstanding the foregoing or any other provision hereof, principal and interest shall be payable as shown on said Debt Service Schedule until completion of the Project, at which time the final Debt Service Schedule shall be determined and attached hereto based upon actual advancements, final costs and completion of the Project, all as provided in the administrative rules governing the Iowa Drinking Water Facilities Financing Program. Payment of principal and interest of this Note shall at all times conform to said Debt Service Schedule and the rules of the Drinking Water State Revolving Fund Program. Interest and principal shall be paid to the registered holder of the Note as shown on the records of ownership maintained by the Registrar as of the 15th day of the month next preceding such interest payment date. Interest shall be computed on the basis of a 360-day year of twelve 30- day months. This Note is issued pursuant to the provisions of Sections 384.24A and 384.83 of the Code of Iowa, for the purpose of paying costs of acquisition, construction, reconstruction, extending, remodeling, improving, repairing and equipping all or paft of the Municipal Water System, including those costs associated with the Roosevelt Street water tower and water distribution improvements project and the Eagle Point water treatment plant and water distribution improvements project; and refunding the Water Revenue Capital Loan Notes Anticipation Project Note, Series 2017, dated September 22,2017, and evidences amounts payable under a certain Loan and Disbursement Agreement dated as of the date hereof, in conformity to a Master Resolution of the City Council of said City duly passed and approved on October 20,2008 (the "Master Resolution") and a Series Resolution of the City Council of said City duly passed and approved on July 15 , 2019 (the " Series Resolution"). For a complete statement of the revenues and funds from which and the conditions under which this Note is payable, a statement of the conditions under which additional series notes or bonds of equal standing may be issued, and the general covenants and provisions pursuant to which this Note is issued, reference is made to the above-described Loan and Disbursement Agreement, the Master Resolution and the Series Resolution. This Note is one of the Series 2019 Notes authorized for issuance in the Series Resolution. Capitalizedterms not defined herein shall have the meanings given to them in the Series Resolution or Master Resolution. This Note is subject to optional redemption at a price of par plus accrued interest (i) on any date upon receipt of written consent of the Iowa Finance Authority or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any optional redemption of this Note may be made from any funds regardless of source, in whole or from time to time in part, in inverse order of maturity, by lot by giving thirty (30) days' notice of redemption by certified or registered mail, to the Iowa Finance Authority (or any other registered owner of the Note). This Note is also subject to mandatory redemption as set forth in Section 5 of the Agreement. Ownership of this Note may be transferred only by transfer upon the books kept for such purpose by the Director of Finance and Budget/City Treasurer, City of Dubuque, Iowa the Registrar. Such transfer on the books shall occur only upon presentation and surrender of this Note at the office of the Registrar, together with an assignment duly executed by the owner hereof or his duly authorized attorney in the form as shall be satisfactory to the Registrar. Issuer reserves the right to substitute the Registrar and Paying Agent but shall, however, promptly give notice to registered Noteholders of such change. All Notes shall be negotiable as provided in Article 8 of the Uniform Commercial Code and subject to the provisions for registration and transfer contained in the Note Resolution. This Note and the series of which it forms a parl, other obligatibns ranking on a parity therewith, and any additional obligations which may be hereafter issued and outstanding from time to time on a paity with said Notes as Senior Bonds under the Master Resolution, are payable from and secured by a pledge of the Net Revenues of the municipal water utility (the "System"), as defined and provided in the Master Resolution. There has heretofore been established and the City covenants and ug.""r that it will maintain just and equitable rates or charges for the use of and service rendered by said System in each year for the payment ofthe proper and reasonable expenses ofoperation and maintenance of said System and for the establishment of a sufficient sinking fund to meet the principal of and interest on this series of Notes, and other obligations ranking on a parity therewith, as the same become due. This Note is not payable in any manner by taxation and under no circumstances shall the City be in any manner liable by reason of the failure of said Net Revenues to be sufficient for the payment hereof. The Issuer has covenanted and hereby covenants and agrees at all times while any Senior Bonds are Outstanding and unpaid to budget for and collect amounts in respect of the use of the System fully sufficient at all times to: (i) provide for 100% of the budgeted Operation and Maintenance Expenses of the System and (ii) produce Net Revenues in each Fiscal Year which will: (a) equal at least lI0% of the Debt Service Requirement on all Senior Bonds then Outstanding for the year of computation, (b) enable the Issuer to make all required payments, if any, into the Debt Service Reserve Fund and the Rebate Fund, (c) enable the Issuer to accumulate an amount which, in the judgment of the Council, is adequate to meet the costs of major renewals, replacements, repairs, additions, betterments and irnprovements to the System, necessary to keep the same in good operating condition or as is required by any governmental agency having jurisdiction over the System, and (d) remedy all deficiencies in required payments into any of the funds and accounts established under the Master Resolution frorn prior Fiscal Years. The Master Resolution contains a firore particular statement of the covenants and provisions securing the Senior Bonds, the conditions under which the owner of this Note may enforce covenants (other than the covenant to pay Principal of and interest on this Note when due from the sources provided, the right to enforce which is unconditional), the conditions upon which additional Senior'Bonds may be issued on a parity or achieve parity status with this Note under the Master Resolution, and the conditions upon which the Master Resolution may be amended with the consent of the owners of not less than two-thirds in aggregate Principal amount of the Bonds Outstanding or the issuer of any Credit Facility, if any, of such Bonds. Upon the occurrence of an Event of Default under the Master Resolution, the owner of this Note shall be entitled to the remedies provided by the Master Resolution. And it is hereby represented and certified that all acts, conditions and things requisite, according to the laws and Constitution of the State of Iowa, to exist, to be had, to be done, or to be performed precedent to the lawful issue of this Note, have been existent, had, done and performed as required by law. IN TESTIMONY WHEREOF, said City by its City Council has caused this Note to be signed by the manual or facsimile signature of its Mayor and attested by the manual or facsimile signature of its City Clerk, with the seal of said City impressed hereon, and authenticated by the manual or facsimile signature of an authorized representative of the Registrar, the City Treasurer of the City of Dubuque, Iowa, all as of the day of-,2019 Date of authentication:CITY OF DUBUQUE, STATE OF IOWA This is one of the Notes described in the within mentioned Resolution, as registered by the City By: Treasurer Mayor CITY TREASURER, Registrar ATTEST: By: Authorized Signature City Clerk (sEAL) Registrar and Transfer Agent: City Treasurer Paying Agent: City Treasurer By ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto (Social Security or Tax Identification No ) the within Note and does hereby irrevocably constitute and appoint attorney tn to transfer the said Note on the books kept for registration of the witliin Note, with full power of substitution in the prernises. fact Dated: (Person(s) executing this Assignment sign(s) here) SIGNATURE ) GIJARANTEED IMPORTANT - READ CAREFULLY The signature(s) to this Power lnust correspond with the narne(s) as written upon the face of the certificate(s) or Note(s) in every particular without alteration or enlargement or any change whatever. Signature guarantee must be provided in accordance with the prevailing standards and procedures of the Registrar and Transfer Agent. Such standards and procedures may require signature to be guaranteed by ceftain eligible guarantor institutions that participate in a recognized signature guarantee program. INFORMATION REQUIRED FOR REGISTRATION OF TRANSFER Name of Transferee(s) Address of Transferee(s) Social Security or Tax Identification Number of Transferee(s) Transferee is a(n): Individual* Partnership Corporation Trust xlf tlie Note is to be registered in the names of multiple individual owners, the names of all such owners and one address and social security number must be provided. The following abbreviations, when used in the inscription on the face of tl-ris Note, sliall be construed as though written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as j oint tenants with rights of survivorship and not as tenants in common IA UNIF TRANS MIN ACT Custodian (Cust) (Minor) Under lowa Uniform Transfers to Minors Act.......'.'.. (State) ADDITIONAL ABBREVIATIONS MAY ALSO BE USED THOUGH NOT IN THE ABOVE LIST City of Dubuque, lowa2019 54.400 Million sRF water Loan Pro-FormaJune27,2OL9Fiscal Year: t 2OL5|L67 20L720t8lL9Budg/Act2O2Ll22Exhibit 1s 9,3s 1, 1 14480,000OPERATING REVENUESMetered RevenuesOther RevenuesTotal Operating RevenuesOPERATING EXPENSESEmployee ExpenseGASB 68/Admin OverheadUtilitiesRepairs & MaintenanceSupplies & Services/lnsuranceEq uipment/Constru ctionTotal Operating ExpensesNET OPERATING REVENUESlnterest EarningsRevenue for Debt ServiceWater Debt ServiceSeries 2007 SRFSeries 2008DSeries 20L0 SRFSeries 2010DEstimated Series 2017 SRFProposed Series 2019 SRFTotal Debt Services8,ss3,22s s8,905,136s8,647,223 s9,008,07ss e,ss8,7s2 59,83L,t14Audit57,96r,s99591,626234678910111213t4$7,677,ss4729,374s 8,406,92852,409,s70188,460650,159187,9821,243,021,146,357s4,82s,s4es 3,s81,379101-,!75S 3,682,ss4s8,1r4,20779L,93558,7s8,1881"48,044s8,s06,23258,76r,223480,000s 8,s28,07s480,00058,8r4,322480,0005s,294,32259,078,7s2480,0005i.,928,797533,097585,726190,646952,396501,43s54,6e2,097s 3,861,12835,767s 3,8e6,8sss 1,804,884728,952690,346L65,48rr,212,542386,82254,989,02753,917,t0955,989s 3,s73,098s2,244,37691-5,908798,337279,4t59L4,1-I89!3,712S 6,06s,861s2,840,37L62,05952,902,43052,402,7691,oo2,352747,683257,570999,495704,43056,1-14,29952,526,92376,06r52,602,984s2,462,8387,026,689770,113265,2971,029,480648,596s6,203,0t4s 2,80s,06140,04152,84s,t0252,s24,4091,096,6s8793,217273,256L,060,36465s,408$ 6,403,313s 2,891,00e44,73252,93s,742s 2,s87,s191,Lt2,970817,01328t,4541-,092,175728,84r56,679,97352,878,77936,82852,6s2,2071,256,246841,524289,8971,r24,940608,04456,772,8s8s 3,058,25638,08152,91s,607 S 3,095,3371s S 62,28816 115,75077 218,42518 380,0751920-21 5 776,538$ 62,9ss s177,3t02r8,L68379,95055,420t18,528218,280379,70067,483s ss,s40 $114,3882L8,246383,250130,49056,640 s115,1582t8,066386,500674,22024,41,456,700115,598193,330384,450674,260260,8L95 57,740115,698195,260387,250673,920269,3805 7,699,248S s8,740115,500!97,090389,r25674,200268,680S 1,703,33ss 778,383 s eSg,+rrs 90r.,913 51.,474,997 S 1,68s,1s6$ s8,700t99,320510,025674,180268,920St,t[,Ms1.81DEBT SERVICE COVERAGENet Revenues/Revenue Debt zz3.22r.761.697.731.71Prepared by Independent Public Advisors, LLC?age 7 of 2Dale:6/27/2019; Time: 1:21 PM City of Dubuque, IowaNet Revenue Certificatelune27,2079Exhibit 206/30/2706/3O/2206130/2305/30/2406/3O/2s06/30/2606/30/2706/3012806/30/2e06130/3o06/30/3706/30/3206/30/3306/30/3406/30/3s06/30/3606/30/3706/30/3806/3O/3906/30/4048,000s0,00052,000s3,00055,00057,000s9,00051,0008,7007,7406,7405,7004,6403,5402,400r,22056,70057,74058,740s8,700s9,54060,54061,400_- 62220_153,s00158,500L53,500169,000174,500180,000186,000192,000198,500205,000211,00039,83036,76033,59030,32026,94023,45019,85016,13012,2908,3204,220193,330!9s,260197,090199,32020!,440203,450205,850208,130270,790273,3202L5,220240,0002s0,000260,000390,000405,000420,000440,000460,000480,00050s,0007M,450r37,250729,!25120,025LO6,37592,20075,40057,80039,40020,200384,450347,250389,125510,025511,375572,200515,400517,800519,40052s,200512,000s01,000501,000511,000521,000531,000542,000s53,0005il,000575,000587,000s98,000610,000523,000635,000648,000561,000762,260172920173,200163,180152,960742,540131,920L21,080110,02098,74087,24075,50063,54051,34038,88026,L8013,220674,260673,920674,200674,180673,960673,s40673,920674,O80674,020673,740674,240673,500673,540674,340673,880674,780674,220181,000185,000188,000192,000195,000200,000204,000208,0002!2,000276,000227,000225,OOO230,000234,000239,0002M,000249,0002s3,000259,00079,41984,38080,68076,92073,08069,r.6065,16061,080s5,92052,68048,36043,94039,44034,84030,16025,38020,50015,52010,460260,819269,380268,680268,920269,080269,160269,160269,080268,920268,680269,360268,940269,440268,840269,150269,380269,500268,520269,4601,685,156r,699,2441,703,3357,7LL,r451,715,4951,718,8907,725,730L73:-3L0!,673,1301,680,9401,158,820942,440942,9a0943,180943,040943,560943,720268,s20269,460269,280100,000 15,598 115,59810s,000 10,698 11s,698110,000 5,500 115,500Totals S482,OOO ssO,32O 5 s32,320 S 41O,0OO s51,953 s 461,953 s2,14O,OOO s321,266 s2,461,,266 s4,085,000 57,073,7255s,158,725 S10,196,000 s1,93s,940 s72,73r,94' 54,400,000264,000 5,280 269,2805998,772 Ss,398,172 526/M,376FY 2018 Operating RevenuesFY 2018 OperatinB ExpensesFY 2018 Net Operating Revenueslnterest EarningsTotal Revenues for Debt services8,906,136(4,989,0271,s 3,917,10955,98953,973,098Maximum Annual Debt ServiceDebt Coverages 1,731,310229.59',. lf Amended Return check here ) Room/suite the issueof lssue 11 12 13 14 15 16 17 3.952,378 18 447,621 Description c (d) Weighted average maturity (c) Siated redemption price at maturity(b) lssue Price(a) Final maturity date 1$4,400p99$4,4Qq,09!06/01/2040 Uses of of -0.22 4,400,00c23 25 -0. 26 -0. 6227444,162 28 -0. 478,16229 30 3,921,837 on of Refun Bonds, Part I Part ll Part lll Part lV Part V Form (Rev. September 201 8) Depadment of the Treasury lnternal Revonue Service 1 lssuer's name 3a Name of person (other than issuer) with whom 4 Number and street (or P.O. box if mail is not delivered to street address) 50w 6 City, town, or post office, state, and ZIP oode 8 Name of issue 1Oa Name and title of officer or other employee of the issuer whom the IRS may call for more information (see instruotions) Director , See the instruction s and attach schedule. 9038-G lnformation Return for Tax-Exempt Governmental Bonds ) under Internal Revenue Gode section 149(e) > See separate instructions'OMB No. 1545-0720 Caution: lf the issue price is under $100,000, use Form 8038-GC. ) Go to www.irs'govlF8038G for instructions and the latest information, 2 lssuer's employer identification number (ErN) the IRS may communicate about this return (see instructions)3b number of other Person shown on 3a 5 Repod number (ForlBS Use Onty) c 7 Date of issue 2019 9 CUSIP number 10b Telephone number of officer or other employee shown on '10a 563 11 12 13 14 15 16 17 18 19a b 20 Education . Health and hosPital Transportation Public safetY . Environment (including sewage bonds) Housing Utilities Other Describe ) refundi lf bonds are TANs or RANs, check only box 19a lf bonds are BANs, check onlY box 19b lf bonds are in the form of a lease or installment check box on ds. Com ete for the entire issue which th is bei underwriters' discou Proceeds used for accrued interest lssue price of entire issue (enter amount from line 21, column (b)) Proceeds used for bond issuance costs (including underwriters' discount) Proceeds used for credit enhancement Proceedsallocatedtoreasonablyrequiredreserveorreplacementfund Proceeds used to refund prior tax-exempt bonds' Complete Part V ' Proceeds used to refund prior taxable bonds' Complete Part V Total (add lines 24 through 28) of the issue (su btract line 29 from line 23 and enter amount th S on ndi bo remaining weighted average maturity of the tax-exemPt bonds to be refunded remaining weighted average maturity of the taxable bonds to be refunded last date on which the refunded tax-exempt bonds will be called (MM/DD^/YYY) 49 51 >[]>n>n (e) Yield 1 % 21 22 23 24 25 26 27 28 29 30 24 62 Nonrefu Enter the Enter the Enter the Enter the 1.1194 VEATS 31 32 33 34 vears 08/09/2019 For Paperwork Reduction Act the refunded bonds were Notice, see separate instructions' 7 Cat. No. 63773S Form (Rev.9-2018) 35 -0. 36a -0. -0. Part Vl Page2 c Enter the name of the GIC provider ) 37 pooled financings: Enter the amount of tt't" pio"""O" of this issue that are to be used to make loans Form 8038-G (Rev' 9-201 8) laneous 35 Enter the amount of the state volume caP allocated to the issue under section 141(b)(5) 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (GlC). See instructions b Enter the final maturity date of the Glc > (MM/DDI/YYI 49 to other governmental units 38a lf this issue is a loan made from the proceeds of another tax-exempt issue, check box ) E and enter the following information: b Enter the date of the master Pool bond l' (MM/DD/YYY! - c Enter the EIN of the issuer of the master pool bond ) d Enter the name of the issuer of the master pool bond ) See attached Schedule I 39 lf the issuer has desig nated the issue under section 265(bX3XB)0(lll) (small issuer exception), check bo>l 40 lf the issuer has elected to PaY a penaltY in lieu of arbitrage rebate, check box 41a lf the issuer has identified a hedge, check here F and enter the following information: b Name of hedge Provider ) c Type of hedge > d :> remediated42 44 45a b the date official intent Under penalties of Perjury'I declare that I have examined this return and accomPanying schedules and statements'and to the best of mY knowledge and belief, they are true, correct,and com I iurther deolare that I consent to the IRS'S disclosure of the issuer's return information, as necessary to prooess to authorized above' Larson,Director of Finance &Budqet authorized rePresentative Type or print name and title PTIN Paid Preparer Use Only Form G (Rev.9-2018) Signature and Gonsent Date check fl if self-emPloYedg-q-nDate 'E::::t''E:w,^,.,&.,-1,*upreparer's name Firm SCHEDULE I 8038-G CitY of Dubuque, Iowa $4,400,000 Water Revenue Capitat Loan Notes, Series 2019 EIN: 42-6004596 PART VI, Lines 38a-d The Iowa Finance Authority (the "Authority") is the bondholder with respect to the _ above referenced bonds. The Authoriiy may determine in the future to issue tax-exempt bonds that ate master pool obligations and reimburse itself for the loan of the proceeds'of the above referenced bonds. To the extent that the Authority issues such master pool obligations and reimburses itself from the proceeds of such master pool obligations for the ioan of the proceedr; of the above r.f.t.rr."d bonds, such reimbursement will be made on the date of issue of such master pool obligations The EIN of the Iowa Finance Authority is 52-1699886. TO 48t9-4460-3939U\881 I 1 6\00768 611912019 Department of the Treasury Internal Revenue Service Ogden, UT 84201-0074 351857.865658.388677.25779 1 SP 0.560 373 111111Ilolllll'I'llll"'I1111111111I11'll1flmlfollinliliwil CITY OF DUBUQUE FINANCE DIVISION FINANCE DEPARTNIENT 50 W 13TH STREE DUBUQUE IA 52001 Acknowledgment of your August 9, 2019 Form 8038-G We received your tax-exempt bond form This notice serves as official acknowledgment that we received your Form 8038=G. If you filed more than one form, you will receive a separate acknowledgment for each one. Important reminders Additional information Notice CP152 Tax period August 31, 2019 Notice date November 4, 2019 Employer ID number 42-6004596 To contact us Page 1 of 1 Phone 877-829-5500 Tax-exempt bond information Name of issue CUSIP number Issue date 4 400 000 WATER REVENUE CAPITAL LOA NONE August 9, 2019 Issue price Maturity date $4,400,000.00 June 1, 2040 • Attach a copy of this notice to all of your correspondence and documents related to this tax-exempt bond. • If a tax practitioner or someone else prepared your form, you may want to give them a copy of this notice. (A copy was automatically sent to all representatives authorized with a Power -of -Attorney for this form.) • Visit www.irs.gov/cp152. • For tax forms, instructions, and publications, visit www.irs.gov or call 800 -TAX -FORM (800-829-3676). • If you have questions about tax-exempt bonds, call TEGE Customer Account Services at 877-829-5500. • Keep this notice for your records. If you need assistance, please don't hesit to contact u