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Thursday.Marcli 29.T$56 ,t ;2kA TftE McHENRY PLAINDEALER LEGAL !"!• 'FM-H- *-fafr-S-*<"S"M»'8"S' .!• •!• •!• •!• •!• * AN qRDINANCE &§ ORDINANCE creating an issue of $11)9,000 'Waterworks and Sewerage ^Revenue Bonds, Series of 1956,' of the City of McHenry, McHenry County, Illinois, and providing for the payment and delivery thereof. WHEREAS, the City oif McHenry, McHenry County, Illinois, has for many years long ;past \ owned and operated in its gov- % errarantal capacity a waterworks |sy stc'm and a sanitary sewerage ^system serving the needs of said f; City and has combined said sys- Y terns into a" combined water- 4 works and sewerage system (said , combined waterworks and sewerage system^ hereinafter, together with improvements, extensions and repairs authorized by this ordinance, and all further improvements, and extensions thereof*' 4jor replacements thereto, herein called the "system") and WHEREAS, the governing body of saiid City has heretofore approved all plans, maps, files and specifications for the construction of needed improvements, extensions and repairs to said system to efficiently collect and dispose of the domestic and industrial wastes and their product withjri said City in the bes\™ interests of the public health and sanitation of said City, and ViiaS determined that said City will need to borrow $179,000 to pay, with other funds to be made available therefor, said improvements, extensions and repairs,, and the income and revenue to be derived from the operation of said system is determined adequate to provide fos$3*he payment of said bonds so proposeq; to be issued in -the principal amount of $179,000, as aforesaid. • NOW, THEREFORE, Be It Ordained by? the City Council of the City ofS McHenry, McHenry County, Illinois, as follows: Section 1, That the existing combined waterworks and sewerage system pf this City shall bo improved, ^tended and repaired in Wjcordarpe with the engineering report •' heretofore submitted to and approved by this Council by W. A. j£akow & Associates, Consulting {Municipal Engineers, Elgin, Illinois, and Robert H. Anderson, Consulting Engineer, St. Charies| Illinois, and also in accordance with the construction contract let therefor with the Tonyan Construction Co., ' Inc., wwr date. Of February 6, 1956, by the acquisition, construction and installation of the following described properties, improvements and equipment, together with all necessary appurtenances and connections used or useful in connection with the public convenience thereof, viz: (a) Construction of a new pump station to be provided with three (3) pumping units, ij>(b) Construction of primary settling tanks with inlets and outlets arranged for separate t*e, (c) Construction of two (2) aeration tanks with inlets and outlets sb arranged for separate use, (d) Construction of two (2) new finaj. settling tanks adjacent to t$p new aeration tanks with inlets and outlets so arf^ inged for separate use, (e) Construction of a new sludge dewatering unit operating on a vacuum filter basis, (f) Th$ conversion of the existing primary tank to sludge well, the 'Conversion of existing aeration tank to primary settling tanks, and the conversion of existing final tank to blower house, •' J* g) A0| easements, properties, ' wortc equipment and appurtenances needful to the construction , and conversion of these improvements and to the integration thereof with the existing Waterworks and sewerage systerA of said City for the proper a^l efficient operation thereof tjQ meet the requirements ofjjthe Sanitary Water Board of \ the State of Illinois, al'ifftis mori^ fully set forth in itemized detail in said plans, files/ map^j and specifications, and construction contract hereinabove referred to and flow on file for public inspection in the office of the City Clerk, and the period of usefulness of said combined waterworks tand sewerage system, including said described improvements, extensions and repays, is hereby determined by thufCity Council to be forty (40) years from'the date of the bonds herein authorized to be issued. Section 2j That for the purpose of accomplishing the needful improvements," extensions and repairs to said system as hereinabove described, there be issued and sold ttye boftds of said City to be designated ^Waterworks and Sewerage Revenue Bonds, Series of,«956, in,^he principal sum of $1'< 3,000, t^ proceeds from the sale thereof aggregating $171,000, together with the sum of $160,000 to be made available by said City from . the proceeds of an issue of $160,000 Sewer Improvement Bondfc? voted at a special election held on June 21, 1955, being hereby determined adequate to pay the cost estimate of constructing said improvemuls, extensions and repairs as' .. "SC heerinabove described (including one (1) year's , interest on said bonds during the period of said construction) in the aggregate sum of $331,000. The said bonds shall bear date of May 1, 1956, be of $1,000 denomination each, numbered from 1( through 179, and shall mature serially in numerical "order, on May 1 irt each of the years and in amounts as follows: $2,000.- 1958 through I960 3,000 - 1961 through 1963 4,000 - 1964 through 1966 5,000 - 1967 through 1970 6,000 - 1971 through 1974 7,000 - 1975 through l'978 8,000 - 1979 through 1982 9,000 - 1983 and 1984 10,000 - 1985 through 1987 provided that the City of McHenry reserves the right to call for redemption prior to maturity, on May 1, >1971, or on any interest payment date thereafter, at par and unpaid accrued interest to the date of redemption, the bonds maturing on May 1 in each of.the years 1972 through 198"^ in the inverse numerical order of said bonds, in accordance with the terms and conditions as set forth in Section 3 of this ordinance. The said bonds shall bear interest at the rate of Four Per Cent (4%) per annum, to be payable on November 1, 1956, and semi-annually thereafter on May 1 and November 1 in each year until paid, and both the principal and interest on the said bonds shall be payable in lawful money of the United States of America at the American National Bank and Trust Company of Chicago, Chicago, Illinois. Said bonds shall be signed by the Mayor, sealed with the corporate seal of said City, and attested by the City Clerk, and the interest coupons attached to said bonds shall be executed by the facsimile, signatures of said Mayor and said City Clerk, and said officials, by the execution of said bonds, shall adopt as and for their own proper signatures their respective facsimile signatures appearing on said coupons. Said bonds, together with interest thereon, shall be payable solely from the revenues derived from the waterworks and sewerage system of said City, and such bonds shall not in any event constitute an indebtedness of said City , within the meaning of any constitutional provision or any constitutional or statutory limitation. Any of said bonds may be registered at the option of the holder as to principal only, at any time prior to jnaturity, in the name of the holder, on the books of said City in the office of the City Treasurer, such registration to be noted on the reverse side of the bonds by the City Treasurer, and thereafter the principal of such registered bonds shall be payable only to the registered holder, his legal representatives or assigns.^ Such registered bonds may be transferred to another registered holder or back to bearer only upon presentation to the City Treasurer, with a legal assignment duly acknowledged or approved. Registration of any of such bonds shall not affect the negotiability of the coupons thereto attached, and such coupons shall be transferable by delivery merely. Section 3. That said bonds and coupons attached thereto shall be in substantially the following form: (Form of Bond) UNITED STATES OF AMERICA STATE OF ILLINOIS COUNTY OF MCHENRY CITY OF McHENRY WATERWORKS AND SEWERt WATERWORKS and SEWERAGE REVENUE BOND SERIES OF 1956 Number $1,000 KNOW ALL MEN BY THESE PRESENTS, that the City of McHenry, in the county of McHenry and State of Illinois, for value received hereby promises to pay to bearer, or if this bond be registered as hereinafter provided, then to the registered holder hereof, solely from the Waterworks and Sewerage Fund of the City of McHenry, as hereinafter mentioned and not otherwise, the sum jof One Thousand Dollars ($l,000) on May 1, 19 , (unless this bond is then subject to prior redemption and has been called for payment and funds provided for the payment thereof as hereinafter stated) and to payinterest on such principal sum from tne date hereof until paid, at the rate of Four Per Cent (4%) per annum, payable November 1, 1956, and semi-annually thereafter on the first days of May and November in- each year, and untU maturity hereof upon presentation and surrender of the interest coupons hereto appertaining as they severally mature. Both principal of and interest on this bond are hereby made payable in lawful money of the United Stattes. of America at the American National Bank and Trust Company of Chicago, Chicago, Illinois. This bond is^ payable solely from revenues derived from the waterworks and sewerage system of said City and not otherwise, and is issued under authority of the Revised Cities and Villages Act, and all laws amendatory thereof and supplementary thereto, for the purpose of paying part of the cost, with other funds Page SeVentecn to be made available therefor, of necessary approvements, extensions and repairs to the waterworks and sewerage system of said City, and this bond does not constitute an indebtedness , of said City within the meaning of any constitutional provision or any constitutional or statutory limitation. Under said Act and the ordinance adopted pursuant thereto, the entire revenue derived and to be derived from the operation of the waterworks and sewerage system of this City shall be deposited in a separate fund designated as the "Waterworks and Sewerage Fund of the City of MdHenry," which shall be used only for the purpose of paying the cost of operating and maintaining such system, providing an adequate depreciation fund, and paying the principal of and interest on the bonds of said City that are issued under authority' of said Act and are payable by their terms only from the revenue of such system, and creating and maintaining the several accounts established by the ordinance authorizing the issue of bonds of which this bond is one. - Said City reserves the right to redeem prior to maturity, on May 1, 1971", or on any interest payment date thereafter, at par and unpaid accrued interest to the date of redemption, the bonds maturing on May 1 in each of the years 1972 through 1987, in the inverse numerical order of said bonds. Notice 'of such redemption shall be given by registered mail to the registered holder, if known, at the address shown on the books of the Registrar, and as to unknown holders, such notice shall be published once a week for at least two (2) consecutive weeks in a newspaper published in the City of Chicago, Illinois, and devoted in part to the publication of financial news, and shall be filed at the place of. payment of said bon.ds. The mailing, the filing and the date of the first publication of said redemption notice shall be at least thirty (30) days prior to the date specified for redemptipn, and said redemption notice shall describe the bonds to be redeemed, the date of redemption, and the place of redemption, which shall be the paying agent as stated in said bonds. After notice of redemption has been given in accordance herewith and funds are on deposit with the paying agent to pay the said bonds so to be redeemed, interest thereon shall cease from and after the date of redemption. It is hereby certified and recited that all acts, conditions and things required by the Constitution and statutes of the State of Illinois to be done precedent to and in the issuance of this bond and in raising funds to promptly assure payment thereof, have been done and have hapened and have been performed in regular and due form of law; that provision has been made for depositing in said Waterworks and Sewerage Fund the entire revenues received from the operation of said system, to be applied in the manner as hereinabove set forth; and it is. hereby covenanted and agreetr that rates will be charged for the use and service of such system sufficient at all times to create and maintain the several Accounts established by the or? dinance authorizing the issue of bonds of which this bond is one. This bond may be registered as to principal in the name of the holder, on the books of said City in the office of the City Treasurer, such registration to be evidenced by notation of said Treasurer on the • back hereof, and after which no transfer hereof shall be valid unless made on s'aid books and similarly noted hereon, but it may be discharged from such registration by being transferred to bearer, after which it shall be transferable by delivery, but it may be again registered as before. The' registration ofn this bond shall not restrict the negotiability of the coupons by delivery merely. IN WITNESS WHEREOF, said City of McHenry, McHenry County, Illinois, by its City Council, has caused this bond to be signed by its Mayor, its corporate seal to be hereto, affixed and attested by the City Clerk, and the coupons hereto attached to be signed by the facsimile signatures of said Mayor and said City Clerk, which officials, by the execution of this bond, do adopt as andv for their own proper signatures their respective facsimile signatures appearing on said coupons, and this bond to be dated as of the first day of May 1, 1956. Attest: Mayor City Clerk (Form of Coupon) Number $ On the first day of 19 , the City of McHenry, McHenry County, Illinois, will pay to bearer out of the Waterworks and Sewerage Fund of said City unless the bond to which this coupon is attached has been called for redemption as therein provided) Dollars ($ ) in lawful money of the United States of America, at the American National Bank and Trust Company of Chicago, Chicago, Illinois, being interest then due on its Waterworks and Sewerage Revenue Bond, Series of 1956, dated May 1, 1956, numbered . (facsimile signature) Mayor (facsimile signature) City Clerk (Form of Registration Certificate) Date of Registration In Whose Name Registered Signature of City Treasurer Section 4. That upon the issuance of any of the Waterworks and Sewerage Revenue Bonds herein provided for, the entire waterworks and sewerage systerfl of said City, for the purpose of this ordinance, shall be operated oh a fiscal year basis, commencing the first day of May and ending the last day of April of each succeeding year, beginning as of May 1, 956, and during each year ending April 30, so long-as-apy of the bonds herein authorized to be issued are out-1 standing, the entire revenues d<«- rived from the operation-, of1 said system of said City shall be- collected and shall be set aside as collected, and shall be deposited in accordance with the laws of the State of Illinois governing the deposit of public moneys, in a separate fund, which is hereby created, to be designated as the "Waterworks and Sewerage Fund of the City of McHenry," which shall be kept apart and segregated from all other moneys of said City and shall be used only to create and maintain the several accounts hereinafter specified for the purpose of paying the cost of the operation and maintenance of said system, providing an adequate depreciation reserve, and paying the principal of and interest upon the Waterworks and Sewerage Revenue Bonds isued under the terms of this ordinance, and such Waterworks and Sewerage Fund shall be used only for such purposes and is hereby pledged therefor. Section 5. For the accounting of all moneys and assets of said Waterworks and Sewerage Fund at ajny time and from time to time while any Waterworks and Sewerage Revenue Bonds herein authorized are outstanding and unpaid, there is hereby created and established five separate Accounts to be designated (a) the Operation and Maintenance Account, tb) the Depreciation Account, (c) the Bond Account, (d) 'the Bond Reserve Account, (e) the Surplus Account, and all deposits made to and all funds held in each of said Accounts, respectively, shall be continuously secured as provided by the laws of the State of- Illinois governing the deposit of public moneys and into which there shall be paid on the first business day of' each month all moneys held in said Waterworks and Sewerage Fund in accordance with the following provisions and in the priority of said Accounts so created and established as follows: (a) Operation and Maintenance Account: There first shall be set apart and paid out of said Waterworks and Sewerage Fund irito an Operation apd Maintenance Account an amount considered necessary and sufficient "to pay the reasonable current expenses of operating, repairing and maintaining said system for the surrent month. (b) Depreciation -Account: There next shall be deposited in the Depreciation Account a sum sufficient to aggregate $2,400 each year until a maximum sum of $4,800 is on deposit in saifl Account, which is hereby f6und and determined to be a reasonable amount necessary to accomplish the purpose for which said Depreciation Account is established, and at which figure said Account, notwithstanding any transfer therefrom as herein permitted, shall thereafter be continuously maintained. The moneys in said Account shall be used to pay the cost of necessary replacements to the system, and shall not be used for extensions to said system, except that the funds held in said Depreciation Account to the extent necessary to prevent or remedy a default in the payment of the interest on or principal of the bonds herein authorized shall be used and held for use for that purpose, and shall be transterred to the j deposited in Bond Account, and whenever ; Account and tained at the American National Bank and Trust Compahy of Chicago, Chicago, Illinois, for the purpose of paying t the maturing principal of and the interest accruing on the Waterworks and Sewerage Revenue Bonds issued under the terms of this ordinance, an amount at least equal to one-sixth (l/6th) of the interest becoming due on all outstanding Waterworks and Sewerage Revenue Bonds on the next succeeding interest payment date, and beginning with the fiscal year commencing May 1, 1957, and for each fiscal year thereafter, an amount equal to onetwelfth (1 /12th) of the principal becoming due on the next succeeding- principal payment date, sUch" equal monthly installments to produce not less than the following minimum amounts in each fiscal year: Fiscal Year Principal Ending" and •< April 30 Interest 1957 $7,160.00 1958 9,160.00 1959 9,080.00 1960 9,000.00 1961 9,920.00 1962 9,800.00 1963 9,680.00 1964 10,560.00 1965 10,400.00 1966 10,240.00 1967 11,080.00 fc ' 1968 10,880.00 * ' 1969 10.680.00 1970 10,480.00 1971 li,280.00 1972 11,040.00 1973 10,800.00 1974 10,560.00 «• 1975 11,320.00 1976 11,040.00 1977 10,760.00 1978 10,480.00 1979 11,200.00 1980 10,880.00 1981 10,560.00 1982 10,240.00 1983 " 10,920.00 c 1984 10,560.00 f 1985 11,200.00 1986 10,800.00 1987 10,400.00 (d) Bond Reserve Account: There shall next be desposited in the Bond Reserve Account a sum sufficient to aggregate $1,000 each year until a maximum of $12,000 is on deposit in said Account, and at which figure said Account, notwithstanding any transfer therefrom as herein permitted, shall thereafter be continuously maintained, and all moneys therein shall be only used by the Treasurer hereof as may be needed frojn time to time in the payment of the interest on or principal of the bonds herein authorized whenever there exists a deficiency in the Bond Account hereinabove established, and all withdrawals therefrom for that purpose shall be reimbursed from the next revenues available therefor as provided therein. The moneys in said Bond Reserve Acourtt shall be deposited with the American National Bank £nd Trust Company of Chicago^ Chicago, Illinois, and may be invested and reinvested in bonds or other obligations of the United States Government maturing within five (5) years from date of purchase as may be authorized from time to time by resolution of the Mayor and City Council of said City.. (e) Surplus Account: Any surplus funds remaining at the end of any fiscal year after providing for all of the deposits hereinabove listed in subparagraphs (a) through (d), and after the reimbursement of any account that is depleted by withdrawals, sliall be deposited in the Surplus Account. The moneys in said Surplus Account shall be used or held for use exclusively (a) for the purpose of making improvements and extensions to the system, or (b) for the prior redemption of the bonds herein authorised prior to their maturity in accordance with all ihe terms, provisions and conditions to accomplish such prior redemption, and any bonds so redeemed shall be cancelled, or (c) for any lawful purpose. Section 6. That the City of McHenry hereby agrees to carry insurance on said system of the kinds and in the amounts which are usually carried by private parties operating similar properties, including without limiting the generality of the foregoing, fire, windstorm insurance, public | liability, and any additional in- j st ance covering $uch risks as j shall be i*ecommended by a com- j petent independent engineer em-1 ployed for the purpose of mak- j ing such recommendations, and i all moneys received for losses "unt^er such .insurance policies as insure against physical damage to or loss of the system shall be the . Depreciation shall be used in such a transfer is made, the making good the loss or damage amount so transferred shall be . in respect of which they were added to the next deposit to be j paid, either by repairing the made, and thereafter until full I property damaged or replacing reimbursement to said Deprecia- j the property destroyed, and protion Account has been made. The moneys in said Depreciation Account may be invested and reinvested in bonds or other obligations of the United States Government maturing within five (5) years from the date of purchase as may be authorized from time to time by resolution of the Mayor and City Council of said City. (c) Bond Account: There next shall be deposited, in the Bond Account, which shall be mainvision for making good such loss or damage shall be made within ninety (90) days from the date of the lpss. The proceeds of any and all policies for public liability shall be paid into the Operation and Maintenance Account and used in paying the claims on acount of which they were received. The payment of premiums for all insurance policies required under the provisions of this section shall be considered an operation and maintenance expense. Section 7. That while any of the Waterworks and Sewerage Revenue Bonds issued pursuant to this ordinahce remain outstanding or unpajd, rates charged for water and sewerage services sl\all be sufficient at all times to pay all costs of operation and maintenance of the system, to make the payments and maintain the balance as required in the Depreciation Account, to pay the principal of and interest on all bonds authorized hereunder, and to make the payments and maintain the balance as required irt^ the Bond Reserve Account, as is hereinabove provided for. There shall be charged against all users of the system, including the City of McHenry, such rates and amounts for water and sewerage services as shall be adequate to meet the requirements of this section. Charges for services rendered the City shall be made against the said City, and; payment for the same from the corporate funds shall be made monthly into the Waterworks and Sewerage Fund created by this ordinance as other revenues derived from the operation of the system and in the sanie manner as other revenues; are so required to be deposited. Ih addition to the foregoing said City covenants not to provide any free service of said system and to pay promptly for the use of all facilities connected, and to be connected, with said system. It is expressly herein covenanted that said City will not grant a franchise for the operation of any competing waterworks system or sewer system within the City of McHenry, and that the bonds herein authorized to be executed shall constitute legally enforceable liens upon the earnings of the combined waterworks and sewerage system of said City, including all further extensions, additions, and improvements thereto, whether acquired through purchase, contract, or otherwise. Section 8. In the event said City defaults in complying with any covenant contained in this ordinance, any holder of , any bond issued hereunder, or of any coupon representing interest accrued thereon, may apply for the appointment of a receiver, or may, either in law or in equity, by proper suit, compel the officials of said City to perform all duties required by law and by this ordinance, including the making and collecting of sufficient rates for water and sewerage services for that purpose and the application and segra&ation of all income and revenue therefrom in - accordance with the requirements of this ordinance. Section 9. That it is hereby covenanted and agreed with the holders of the bonds herein authorized that said City will not issue any other or additional bonds or other evidences of obligations of said City payable from or in any way creating a charge upon the income and revenue to be derived from the operation of said system, except as herein provided: (A) Said City reserves the right to isue additional bonds to assure the completion of the construction of improvements, extensions and repairs to said system as hereinabove described and in accordance with the aforementioned plans and specifications adopted therefor in an amount found and determined hecessary as determined by ordinance adopted by the governing body of said City, provided that before any such ordinance shall be adopted there shall be filed with the governing body of said City a requisition of the engineer in responsible charge of constructing/^said improvements, extensions/and repairs, (i) certifying to the amount of additional money needed and m detail the respective purposes for which such additional money is to be disbursed and the amount to be disbursed for each purpose; (ii) if the pertinent requisition of such engineer shall describe any lands or rights therein certifying that the lands or rights therein so described are necessary to complete the construction of such improvements, extensions and repairs and specifying the particular purposes for which the same are to be used; (iii) if any of the additional money, requested is to be disbursed in payment for property furnished or constructed other than real estate and rights therein certifying that such property has been furnished or constructed in compliance with the plans and specifications as aforesaid; and (iv) certifying that the amount of such additional money will be sufficient to complete the construction of such improvements, extensions and repairs in accordance with the said plans and specifications therefor and all lawful permits required by law. (B) Said City reserves the right to issue additional bonds for constructing further necessary improvements, extensions, repairs and rehabilitations to the properties Comprising sffid system as shall be determined necessary for the continued and efficient operation of said system by a cei',tificate filed of an independent engineer in responsible charge of such further improvements. extensions,. repairs and rehabilitations, *• (i) giving a reasonably detailed description of such work, an estimate of the cost thereof, and an estimate of the time of completion thereof; and (ii) showing the feasibility of such revenue financing with reference to then existing rates and anticipated earnings based thereon, which certificate shall be approved by and shall be made of public record in the proceedings of the governing body of said City before any such additional bonds are authorized provided, however, that no such additional bonds for such purpose or purposes shall be issued unless and until the gross cash operating revenues of said system earned for the last fiscal yeaf ending April 30 immediately preceding the authorization of any such additional bonds, as shown by an audit of an independent certified public accountant, were sufficient to pay all costs of the operation and maintenance of said system, to make the annual payments to the Depreciation Account and to the Bond Reserve Account, respectively, as hereinabove required, and to make up any and all deficiencies then existing as hereinabove specified in Section 5 of this ordinance, and leave a balance equal to one and one-tenth (1 1/10) times the maximum amount of interest and principal that will become due in any fiscal year subsequent to the issuance of such additional bonds on the bonds of this issue then outstanding (including said additional parity bonds to complete the improvements, extensions and repairs as specified in paragraph A of this Section) and on the additional bonds then proposed to be issued. Said City further covenants that if any additional bonds are so issued as permitted by this paragraph, the maximum amounts to be deposited in the Bond Reserve Account and the Depreciation Account shall be increased in the proportion to the principal amount of any additional bonds so issued. (C) Said City reserves the right to issue bonds, to refund the $179,000 principal amount of Waterworks and Sewerage Revenue Bonds, Series of 1956, herer in authorized, or arty portion thereof, with the consent of the holders thereof, from time to time as may be determined necessary or expedient and for the best interests of this City, and ' ail such refunding bonds so authorized and issued shall be payable from the income and revenue derived and to be derived from the Operation of said system on a parity with any of the said $179,000 principal amount Waterworks and Sewerage Revenue Bonds, Series of 1956, herein authorized to be issued as may not be refunded and as may be outstanding at the time of the issue and deliveiy of any of said refunding bonds, as aforesaid. (D) When the conditions specified in paragraphs A, B and C of this section for the issue of additional bonds to complete the construction of the improvements, extensions and repairs herein authorized, or for the issue of additional bonds for the construction of further necessary improvements, extensions, repairs and rehabilitations, or for the refunding of the bonds herein authorized, have ben met, then upon the issue thereof any such additional bonds when issued shall be entitled tothe equal and proportionate benefit and security of the pledge of the revenue and income derived and to | be derived from the operation of said system with the bonds herein authorized without perference, priority or distinction as to participation of such pledge of revenue, Or in the preference of one. bond or coupon of each of said issues over or from any other issue, by reason of priority in execution, issue, delivery or negotiation thereof, or by reason of the date or dates of said bands, or the date or dates of maturity thereof, or for any other reason whatsoever, the intent hereof being that each and all of said bonds, as aforesaid, and of coupons evidencing interest thereon, shall have the same right and pledge as to payment and security with the same legal effect as if each and all of said bonds and coupons had been- executed, issued, delivered and negotiated simultaneously as one proceeding . Section 10. That the City of McHenry hereby covenants and agrees with the ..holder oY holders of said bonds that it will punctually perform all duties with reference to said system, in-J eluding the making- artd collect- j ing of sufficient rates for the j use i and service of said system, j all as required by the Constitution and laws of the State of Illinois, and segregating the revenues of said system and. main* taining the Waterworks and Sewerage Fund and the application of the respective Accounts created by this ordinance, and it hereby covenants and agrees not j to sell, lease, loan, mortgage, or j in any manner dispose - of or | encumber said system, including any .and all extensions and improvements that may be made thereto* or the income and revenue derived therefrom, except as permitted in Section .9 hereof, until all of the bonds herein authorized to be issued shall have been paid in full, both principal and interest, or unless and until provision shall have been made for the payment thereof. And said City further covenants'and agrees with the holders of said Waterworks and Sewerage Revenue Bonds authorized hereunder to maintain in good condition and continuously operate said system, and to make, enact and enforce all needful rules and regulations and ordinances for the efficient management and proper maintenance and protection. of such system, and for the use and service thereof. | Section 11. j^id Waterworks and Sewerage Fund and the Accounts created under Section 5 hereof, shall be audited within sixty (60) days after the close of each fiscal year by' an independent firm of certified public accountants, and such audit and Accounts shall be open fOr inspection at all proper times to any holder of bonds issued under the provisions of this ordinance, or any one acting for or on fcehelf of .such bondholder. Such audit report shall include the following items: (a) Balance Sheet, (b) Operating statement, (c) Comments of the. auditor relative to the fulfillment of ordinance provisions and the manner in which the system has been operated and any recommenda» tion for improving the operation of the system, (d) Insurance data, (e) Number of metered customers; number of unmetered customers; number of properties connected to the system; number of hydrants, and (f) Gallons of water passing through master meter and gallons of water billed, and copies of such audit report shall be furnished the original purchasers of the bonds herein authorized, and shall also be furnished to any bondholder upon request. Section 13. That the provisions of this ordinance shall constitute a contrabt between the City of McHenry and the holders of the bonds herein authorized to be issued, and after the issuance of said bonds no changes, additions or alterations of any kind shall be made hereto, except as hereinbefore provided, until all of said bonds and the "interest thereon shill have been paid in full, or unless and until provision shall have been made for the payment thereof. Section IS.. Tha.t the proposal] of Ballinan & Main, of Chicago, Illihois, to purchase the said bonds herein authorized in accordance with the^r contract for the purchase thereof be and thf* same is hereby in all respects ratified, approved and Confirmed, and said bonds when duly cuted as provided herein shall be delivered to the Treasurer who shall receipt for the payment of said bonds against delivery there* of to said purchasers at a price of $171,000 plus accrued interest, from the date of said bonds to the date of the delivery and payment thereof, the said purchase price being such that the inter* est cost to this City does not exceed Six Per Cent (6%) an* nually computed to maturity according to the standard table of bond values, as provided and. permitted by the statutes of the State of Illinois thereunto enabling. All proceeds derived at the sale and delivery of the said bonds shall be accounted for by said Treasurer as follpws: (i) From the proceeds received as principal the sum of $7,000, together with all accrued interest from the date of the bonds to the date of the delivery and payment thereof shall be deposited in the Bond Account at the American National Bank and Trust Company of Chicago, Chicago, Illinois, to be used and held for use solely to pay the interest on said bonds during the period of construction; (ii) From the remaining proceeds received as principal, together with the sum of $160,000 to ]be received from the proceeds of other bonds of said City authorized for that purpose as hereinabove described in this ordinance, the Treasurer shall deposit the sum of $324,- 000 in a separate and special account of sa?d.Cjty to be known and designated JJS the "Waterworks and Sewerage System Bond Construction Fund Account," and suclfc deposits shall be made in the American National Bank find Trust Company of Chicago, Chicago, Illinois, as depositary, to be secured in the manner, form and time as by law required, and all proceeds held in said Construction Fund Account shall be used and held for use solely to construct the improvements, extensions and repairs to the combined waterworks and sewerage system of said City, HS hereinabove described in this ordinance, and" the' beneficial interest to all motleys, held in said Cort5tnjo> ^ tion Fund Account at the timfc"7 of the . original deposit therms and from tfh» to time after shall be in the holder $r holders of the bonds herein (.Continued on Page 18)