HomeMy WebLinkAboutJUNE 29, 1982 MINUTES
M I N U T E S
VIRGINIA BEACH CITY COUNCIL
Virginia Beach, Virginia
29 June 1982
in accordance with Section 3.06 of the City Charter and 2-21 of the
City Code of the City of Virginia Beach, the Special Meeting of the
Council of the City of Virginia Beach, Virginia, was called to order
by Mayor J. Henry McCoy, Jr., D.D.S., in the Council Chambers, City
Hall Building, on 29 June 1982, at Five-Thirty in the evening, for
the purpose of adopting on second reading the Ordinances regarding
the purchase of Kempsville and County Utilities.
Council Members Present:*
John A. Baum, E. T. Buchanan, F. Reid Ervin, Vice
Mayor Harold Heischober, Barbara M. Henley, Clarence
A. Holland, M.D., Reba S. McClanan, Mayor J. Henry
McCoy, Jr., D.D.S., Meyera E. Oberndorf, and Patrick
L. Standing
Council Members Absent:
W. H. Kitchin, Ill
PLEDGE OF ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA
*VERBAL ROLL CALL OF COUNCIL
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ITEM #18412
THIS ITEM AND ITEMS #18413, 18414, 18415 WERE ADOPTED BY ONE MOTION.
Upon motion by Councilman Buchanan, seconded by Councilman Holland, City
Council voted to ADOPT ON SECOND READING the Ordinance authorizing the
issuance of Water and Sewer Revenue Notes of the City of Virginia Beach,
Virginia, in an amount not to exceed $2,200,000.
Voting: 7-3*
Council Members Voting Aye:
John A. Baum, E. T. Buchanan, F. Reid Ervin, Vice
Mayor Harold Heischober, Clarence A. Holland, M.D.
Mayor J. Henry McCoy, Jr., D.D.S., and Patrick L.
Standing
Council Members Voting Nay:
Barbara M. Henley, Reba S. McClanan, and Meyera E
Oberndorf
Council Members Absent:
W. H. Kitchin, III
*VERBAL ROLL CALL OF COUNCIL
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AN ORDINkNCv- AUTHORIZING Tlil-7 TSSU.@CZ (@E,
WATER PIM SEWER REVEN@ NOTES OF THE CITY CF
VIRGINIA BEACH, VIRGINIA, IN AN AMOUI@T NOT -@O
EXCEED $2,200,000
WHEREAS, as a part 6f a prog--am for acqui.-i,-ig %.iater and
sewer facilities located within the boundaries of the City of
Virginia Beach, Virginia (the City), the City Council has de-
termined that it is desirable to acq-uire the sewer system of
County Utilities@Corporation (the Corporation); and
WHEREAS, the City proposes to accluire such sewer system
by the purchase of the stock of the Corporation and following
such acquisition to dissolve the Corporation and to integrate
its sewer system into the City's water and sewer system; and
WHEREAS, the City Council has authorized the execution
of a contract with the owners of all the stock of the
Corporation for the purchase of such stock (the Stock Purchase
Contract); and
WHEREAS, the City proposes to pay for the acqui.sition
of such stock through the issuance of its obligations in the
principal amount not to exceed $2,200,000 as contemplated by
the Stock Purchase Contract;
BE IT ORDAINED BY THE COUNCIL OE THE CITY OF VIRGINIA
BEACF, VIRGINIA:
1. It is hereby determined to be nec--ssary and expedi-
ent for the City to acquire the sewer system of the Corporation
through the purchase of all the stock of the Corporation and to
finance, in part, such acqui.si.tion through the issuance of
water and sewer revenue notes of the City in an amount not to
exceed $2,200,000.
6 / 2 9 / 8 2
2. Pursuant to the authority of the City Charter and
the Ptiblic Finance Act, as amended, there are hereby au-@horized
to be issued water and sewer revenue notes of the City in an
amount not to exceed $2,200,000 to provide funds, together with
other available funds, to acquire the sewer svstem operated by
the Corporation through the purchase of all the stock of the
Corporation.
3. The form and details of the notes shall be speci-
fied in an appropriate resolution or resolutions to be adopted
hereafter which shall be consistent with the terms of the Stock
Purchase Contract.
4. The notes shall be limited obligations of the City
payable solely from the revenues to be derived from its water
and sewer system. The notes shall state that they shall not be
deemed to create or constitute an indeb"edness of or a pledge
of the faith and credit of the Commonwealth of Virginia or any
county, city, town or other political subdivision of the
Commonwealth, including the City. The issuance of the notes
and the undertaking of the covenants, conditions and agreements
to be contained in the resolution or resolut4@ons to be adopted
hereafter shall not directly, indirectly or contingently obli-
gate the City, the Commonwealth or any other political subdivi-
sion of the Commonwealth to levy and collect any taxes whatso-
ever or make any appropriation therefor, except from the reve-
nues of the water and sewer system pledged to payment of prin-
cipal of and interest on the notes.
S. The resolution to be adopted hereafter authorizing
the issuance of the notes and providing the details thereof
shall contain appropriate covenants requiring the City to fix,
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6 / 2 9 / 8 2
charge and collect such rates, fees and other charges for the
use of and for the services furnished by its water and sewer
system and to revise the same from time to time and as often as
shall be necessary so as to produce sufficient net revenues to
pay principal of and interest on -the notes as the same become
due and to provide a margin of safety therefor. Such resolu-
tion shall also include such additional covenants, agreements
and other terms as are customary for the protection of the
holders of water and sewer revenue obligations.
6. This ordinance shall take effect immediately.
Approved June _, 1982
By
Mayor
First Reading: Ji,ne 28 1982
Second Reading: June 29, 1982
-3-
62 98 2
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ITEM #18413
Upon motion by Councilman Buchanan, seconded by Councilman Holland, City
Council voted to ADOPT ON SECOND READING the Ordinance authorizing the
issuance of Water and Sewer Revenue Notes of the City of Virginia Beach,
Virginia, in an amount not to exceed $1,800,000.
Voting: 7-3*
Council Members Voting Aye:
John A. Baum, E. T. Buchanan, F. Reid Ervin, Vice
Mayor Harold Heischober, Clarence A. Holland, M.D.
Mayor J. Henry McCoy, Jr., D.D.S., and Patrick L.
Standing
Council Members Voting Nay:
Barbara M. Henley, Reba S. McClanan, and Meyera E
Oberndorf
Council Members Absent:
W. H. Kitchin, Ill
*VERBAL ROLL CALL OF COUNCIL
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Ali ORDINANCE AUTHOR'@ZIN-@ THE ISSUANCE 6F
WATER AND SEWER REVE@IUE NOTES OF THt CITY OF
VIRGINIA BEACH, VIRGINIA, IN AN AMOUNT NOT TO
EXCEED $1,800,000
WHEREAS, as a part of a program for acquiring water and
sewer facilities located within the boundaries of the City of
Virginia Beach, Virginia (the City), the City Council has de-
termined that it is desirable to acquire the sewer system of
Kempsville Utilities Corporation (the Corporation); and
WHEREAS, the City proposes to acquire such sewer system
by the purchase of the stock of the Corporation and following
such acquisition to dissolve the Corporation and to integrate
its sewer system into the City's water and sewer system; and
WHEREAS, the City Council has authorized the execution
of a contract with the owners of all the stock of the
Corporation for the purchase of such stock (the Stock Purchase
Contract); and
WHEREAS, the City proposes to pay for the acquisition
of such stock through the issuance of its obligations in the
principal amount not to exceed $1,800,000 as contemplated by
the Stock Purchase Contract;
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA
BEACH, VIRGINIA:
1. It is hereby determined to be necessary and expedi-
ent for the City to acquire the sewer system of the Corporation
through the purchase of all the stock of the Corporation and to
finance, in part, such ac@sition through'the issuance of
water and sewer revenue notes of the City in an amount not to
exceed $1,800,000.
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2. Pursuant to tlie authority of the City Charter and
the Public Finance Act, as amended, there are hereby authorized
to be issued water and sewer revenue notes 6f the City in an
amount not to exceed $1,800,000 to provide funds, together with
other available funds, to acquire the sewer system operated by
the Corporation through the purchase of all the stock of the
Corporation.
3. The form and details of the notes will be specified
in an appropriate resolution or resolutions to be adopted here-
after which shall be consistent with the terms of the Stock
Purchase Contract.
4. The notes shall be limited obligations of the City
payable solely from the revenues to be derived from its water
and sewer system. The notes shall state that they shall not be
deemed to create or constitute an indebtedness of or a pledge
of the faith and credit of the Commonwealth of Virginia or any
county, city, town or other political subdivision of the
Commonwealth, including the City. The issuance of the notes
and the undertaking of the covenants, conditions and agreements
to be contained in the resolution or resolutions to be adopted
hereafter shall not directly, indirectly or contingently obli-
gate the City, the Commonwealth or any other political subdivi-
sion of the Commonwealth to levy and collect any taxes whatso-
ever or make any appropriation therefor, except from the reve-
nues of the water and sewer system pledged to payment of prin-
cipal of and interest on the notes.
S. The resolution to be adopted hereafter authorizing
the issuance of the notes and providing the details thereof
shall contain appropriate covenants requiring the City to fix,
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6 2 98 2
charge and collect such rates, lees and other cliarges for the
use o.- and for the services furnished by its water and sewer
system and to revise the same from time to time and as often as
shall be neces,sary so as to produce sufficient net revenues to
pay principal o.@ and interest on the notes as the same become
due and to provide a margin of safety therefor. Such resolu-
tion shall also include such additional covenants, agreements
and other terms as are customary for the protection of the
holders of water and sewer revenue obligations.
6. This ordinance shall take effect immediately.
Approved June _, 1982
By
Mayor
First Reading: June 28, 1982
Second Reading: June 29, 1982
-3-
6 2 98 2
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ITEM #18414
Upon motion by Councilman Buchanan, seconded by Councilman Holland, City
Council voted to ADOPT the Resolution authorizing the issuance of
$2,200,000 Water and Sewer Revenue Notes (County Utilities) of the City
of Virginia Beacb, Virginia, and providing for the form, details and
payment thereof.
Voting: 7-3*
Council Members Voting Aye:
John A. Baum, E. T. Buchanan, F. Reid Ervin, Vice
Mayor Harold Heischober, Clarence A. Holland, M.D.
Mayor J. Henry McCoy, Jr., D.D.S., and Patrick L.
Standing
Council Members Voting Nay:
Barbara M. Henley, Reba S. McClanan, and Meyera E
Oberndorf
Council Members Absent:
W. H. Kitchin, III
*VERBAL ROLL CALL
A RESOLUTION AUTHORIZING THE LSSUANCE OF $2,200,OCO
WATER AND SEWER REVE@NUE NOTES (COUNTY UTILI,RIES)
OF TFE CITY OF -@-@AC.Ti, VI.RC'@'@IqlA, AND PRO-
VIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF
WHEREAS, as a part of a program for acquiring water and
sewer facilities located within the boundaries of the city of
Virginia Beach (the City), the C4-ty Council has determined that
it is desirable to acquire the sewer system of County Utilities
Corporation (the Corporation); and
WHEREAS, the City proposes to acquire such system by
the purchase of all of the stock of the Corporation and follow-
ing such acquisition to dissolve the Corporation ar@d to inte-
grate its sewer system into the City's water and sewer system;
and
WHEREAS, the City has entered into a contract with the
owners of all the stock of the Corporation for the purchase of
such stock; and
WHEREAS, the City Council by ordinance adopted on June
28, 1982, has authorized the issuance of water and sewer reve-
nue notes in an amount not to exceed $2,200,000, as contem-
plated by the foregoing contract;
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF VIRGINIA
BEACH, VIRGINIA:
ARTICLE I
Definitions
Section 1.1. Definitions. Whenever used in this reso-
lution, unless a different meaning clearly appears from the
context, the following words and terms shall have the following
meanings:
"City" shall mean the City of Virginia Beach, Virginia.
"City Council" shall mean the Council of the City of
Virginia Beach, Virginia.
"Corporation" shall mean County Utilities Corporation,
a Virginia public service corporation.
"Event of Defaultt' shall mean any of the events enumer-
ated in Section 6.1.
"-Interest Account" shall meai the Interest Account in
the Note Fund established by Section 3.2.
"Net Revenues" sliall mean the revenues derived from the
ownership and operation of the System less costs of operation,
acbr,inistration and insurance.
"Note Fund" shall mean the Water and Sewer Revenue Note
Fund: County Utilities, established by Section 3.2.
"Noteholder" shall mean the registered owner of anv
Note.
6 / 2 9 / 8 2
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"Notes" shall mean water and sewer revenue notes in an
aggregate principal amount not to exceed $2,200,000 authorized
herein.
"Principal Account" shall mean the Principal Account in
the Note Fund established by Section 3.2.
"Stockholders" shall mean the owners of all the stock
of the Corporation.
"Stock Purchase Contract" shall mean the agreement be-
tween the Stockholders and the City dated June _, 1982.
"System" shall mean the water and sewer system of the
City, as it may exist from time to -@ime, and shall include the
sewer system of the Corporation.
ARTICLE II
Details, Execution, Form and Registration of Notes
Section 2.1. Authorization of Notes. There are hereby
authorized to be issued water and sewer revenue notes of the
City in the aggregate principal amount of Two Million Two
Hundred Thousand Dollars ($2,200,000), or such lesser amount as
the City Manager may determine to be required by the Stock
Purchase Contract, to provide funds, together with other funds
that may be available, to finance the cost of acquiring certain
sewer facilities located in the City through the purchase of
all the stock of the Corporation. The Notes shall be designa-
ted "Water and Sewer Revenue Notes (County Utilities)".
Section 2.2. Details of Notes. The Notes shall be
issued as fully registered Notes in various denominations with-
out coupons, shall be numbered from R-1 upward, shall be dated
the date of their delivery, shall bear interest from their date
at the rate of 10% per year, payable semiannually on the last
day of each February and Aug-ust, beginning February 28, 1983,
and shall be payable in principal installments of $88,000 on
August 31 in each of the years 1983 to 2007, inclusive, without
option of prior prepayment. Both principal and interest shall
be payable in lawful money of the United States of America, but
only from revenues pledged to the payment thereof as herein-
after provided. Principal and interest shall be payable by
check or draft mailed to the registered owners at their
addresses as they appear on registration books to be kept by
the City Treasurer, as Registrar, except that the final
installment of principal and interest shall be payable upon
surrender of the Notes at the office of the City Treasurer.
Section 2.3. Execution of Notes. The Notes shall be
si.gned by the Mayor of the City, shall be countersigned by its
Clerk, and its seal shall be affixed thereto.
Section 2.4. Form of Notes. The Notes shall be in
substantia'@ly the following form:
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(Form of Note)
No. R-
UNITED STATES OF AMERICA
COMMONWEALTH OF VIRGINIA
CITY OF VIRGINIA BEACH
The City of Virginia Beach, Virginia, for value re-
ceived, hereby acknowledges itself indebted and promises to
pay, solely from the source and as hereinafter provided, to
the principal sum of
DOLLARS ($
with interest hereon from the date hereof until payment at the
rate of ten percent (10%) per year. Principal is payable in
installments of $ on Aug-ust 31 in each of the years
1983 to 2007, inclusive, without option of prior redemption.
Interest on the unpaid principal is payable semiannually on the
last day of each February and August, beginning February 28,
1983. Principal and interest shall be paid by check or draft
mailed to the registered owner at his address as it appears on
the registration books kept by tl-ie City Treasurer, as
Registrar, except that the final installment of principal and
interest shall be paid upon surrender of this note at the main
office of the City Treasurer. Both principal and interest
shall be paid in lawful money of the United States of America.
This note is one of an issue of $2,200,000 water and
sewer revenue notes of like date and tenor, except as to number
and denomination, issued pursuant to an agreement between all
of the stockholders (the Sellers) of County Utilities
Corporation (the Corporation) and the City dated June -1 1982
(the Agreement),-for the sale by the Sellers and the purchase
by the City of all the capital stock of the Corporation as the
owner of a sewer system in the City. Reference is hereby made
to a resolution of the City Council adopted on June 28, 1982,
for a description of the property pledged and the provisions,
among others, with respect to the nature and extent of the se-
curity, the rights, duties and obligations of the City, the
rights of the holders of the notes and the terms upon which the
notes are issued and secured.
This note and the issue of which it is a part and the
interest thereon are limited obligations of the City payable
solely from the net revenues derived from the ownership and
operation of the City's water and sewer system,. as the same may
from time to time exist. The City is required to charge rates
or fees to users of its water and sewer system and fix and
maintain such rates or fees at such level as will produce suf-
ficient revenue to pay all costs of operation of such system
arid the principal of and interest on the notes and any obliga-
tions hereto.@ore or hereafter issued on account of such system
and secured by a pledge of water or sewer revenues, as tlie same
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respectively become due. The notes and the interest tllereon
shall not be deemed to constitute a debt or a pledge of tlie
faith and credit of the Commonwealth of Virgiiiia or any polit-
ical subdivision thereof, including the City. Neither the
Commonwealth of Virginia nor any politica'@ subdivision thereof,
including the City, shall be obligated to pay the principal of
or interest on this note or other costs incident thereto except
from the revenues pledged therefor, and ne@-ther th-- faith and
credit nor the taxing power of tlie Commonwealth of Virginia or
any political subdivision thereof, including the City; is
pledged to the payment of the principal of or interest on the
notes or other costs incident thereto.
The City shall have the right to offset against any
payments of principal and interest due on this note any amounts
due the City pursuant to the Sellers' indemnification provision
contained in the Agreement.
The security for this note is subject to substitution
at the option of the City for other security, as more specifi-
cally set forth in the Agreement.
IN WITNESS WHEREOF, the City of Virginia Beach,
Virginia, has caused -@his note to be signed by its Mayor, to be
countersigned by its Clerk, its seal to be affixed hereto, and
this note to be dated 1 1982.
Mayor, City of Virginia Beach,
Virginia
(SEAL)
COUNTERSIGNED:
Clerk, City of Virginia Beach,
Virginia
Section 2.5. Delivery of Notes. Upon the fulfillment
of all condi-tions to the City's obligations under the Stock
Purchase Contract, the Mayor and the City Clerk are hereby au-
thorized and directed to have the Notes prepared and executed
in accordance with their terms and to deliver the Notes to the
Stockholders pursuant to the Stock Purchase Contract.
Section 2.6. Registration of Notes. The City
Treasurer shall act as Registrar and shall maintain books for
the registration of the Notes. The Notes are being issued to
the Stockholders in registered form in payment for the purchase
of stock of the Corporation and shall be registered in the
names of others only in the case of gift to members of a
Noteholder's irmmeaiace iainily, clea-@li oi. a Noteliolder or traris-
fer of a Note by op6ration of law and upon receipt by the City
Treasurer of evidence thereof satisfactory to him.
6/1@9/82
Section 2.7. Replacement of Mutilated, Lost or
Destroyed Note. Should any of the Notes become mutilated or be
lost or destroyed, the City Counc@-1, subje--t to approval@ of --he
State Commission on Local Debt, shall cause to be executed and
delivered a new Note of like date and tenor in exchange and
substitution for, and upon cancellation of, such mutilated
Note, or in lieu of and in substitution for such lost or de-
stroyed Note. Such new Note shall be executed and delivered
only when the holder has (a) paid all reasonable expenses and
charges in connection therewith and (b) in the case of a lost
or destroyed Note, has (1) filed with the City Treasurer evi-
dence satisfactory to him that such Note was lost or destroyed
and that he was the owner thereof and (2) furnished to the City
Treasurer indemnity satisfactory to him.
ARTICLE III
Revenues and Note Fund
Section 3.1. Revenue Covenant. The City Council cove-
nants that so long as any of the Notes are outstanding and
unpaid the City,will:
(a) charge rates or fees to users of the System
and fix and maintain such rates or fees at such level as will
produce sufficient revenues to pay the cost of operation and
administration, the cost of insurance against loss by injury to
persons or property and the principal of and interest on the
Notes and any other notes or bonds heretofore or hereafter
issued on account of the System and secured by a pledge of
water or sewer revenues, as the same respectively become due;
(b) apply the revenues derived from the ownership
and operation of the System in each fiscal year first to the
payment of such costs of such operation, administraton and in-
surance during such year, then to the payment of the Notes and
any other bonds or notes heretofore or hereafter issued on
account of the System and secured by a pledge of water or sewer
revenues becoming due in such year; and
(c) segregate and keep segregated from all other
City funds all revenues derived from the ownership and opera-
tion of the System and keep proper records and accounts there-
for, separate and apart from all other records and accounts.
Section 3.2. Note Fund. There is hereby established
the Water and Sewer Revenue Note Fund: County Utilities, which
shall be held by the City's Director of Finance.
(a) At least one business day before the last day
of each February and August the City's Director of F'.nance
shall deposit into the Interest Account from Net Revenues such
amount, if any, as may be required to make the total amount on
deposit therein equal to the amount of interest which will be-
come due on the Notes on the next interest payment date. The
Interest Account shall be used solely for the payment of inter-
est on the Notes.
(b) At least one business day before each
August 31 until payment of the Notes, the City's Director of
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Finance shall deposit $88,000 into the Prizicipal Account from
Net Revenues. The Principal Account shall be used solely for
the payment of the principal of the Notes (whether at maturity
or otherwise).
Section 3.3. Pledge of Net Revenues and Note Fund.
All Net Revenues are hereby pledged to the payinent of the prin-
cipal of and interest on the Notes and any other bonds or notes
heretofore or hereafter issued on account of the Syste@n and
secured by a pledge of water or sewer revenues. All moneys in
the Note Fund shall be trust funds and are hereby pledged to
the payment of the principal of and interest on the Notes. The
lien and trust created hereby are for the benefit of the
Noteholders and for their additional security until all of the
Notes have been paid.
Section 3.4. Parity Obliqations. The Notes shall be
on a parity with other obligations of t@e City heretofore
issued and payable from Net Revenues. Subject to Section 5.3,
the City reserves the right to issue additional bonds or notes
payable from either gross revenues or Net Revenues, with or
'without a pledge of its full faith and credit, ranking equally
with the lien and charge of the Notes.
ARTICLE IV
Security for Deposits and Investment of Note Fund
Section 4.1. Security @ r Deposits. All moneys in the
Note Fund and on deposit with anv bank or trust company in
Virginia shall be continuously secured in the manner required
by the Virginia Security for Public Deposits Act (Chapter 23,
Title 2.1, Code of Virginia of 1950, as amended), or any suc-
cessor provision of law.
Section 4.2. Investment of Funds. Moneys in the Note
Fund may, pending their use, be invested in (a) bonds, notes
and other obligations of the United States of America and
securities unconditionally criaranteed as to payment of princi-
pal and interest by the United States of America or any agency
thereof, (b) savings accounts, time deposits and certifical-es
of deposit in any bank within the Commonwealth of Virginia,
provided such bank is approved for the deposit of funds by the
Commonwealth, (c) savings accounts and certificates of (1) sav-
ings and loan associations that are under the supervision of
the Commonwealth of Virginia and (2) Federal associations orga-
nized under the laws of the United States of America and under
Federal supervision, but only to the extent that such accounts
and certificates are fully insured by the Federal Savings and
Loan Insurance Corporation or any successor Federal agency, and
(d) any other investments which are now or may hereafter be
authorized by law for the investment of public sinking funds.
Any bonds, notes or other obligations listed in subsection (a)
above may be purchased pursuant to a repurchase agreement with
any bank within or without the Commonwealth of Virginia having
a combined capital, surplus and undivided profits of not less
than $10,000,000. Investments so purchased shall be considered
to marure on the date the ban)@ is obligated to repurchase such
securities. A repurchase agreement for securities described in
subsection (a) above shall be considered a purchase of such
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securities even if title and/or possession of such securities
i.s not transferred to the City so long as the repurchase obli-
gation of the bank is collateralized by the securities them-
selves, the securities have on the date of the repurchase
agreeraent a fair market value equal -@o at least 100% of the
amount of the repurchase obligation of the bank and the securi-
ties are held by a third party and segregated from securities
owned generally by the bank. Moneys in the Note Fund shall not
be invested in securities or deposits ma@@uring later than the
date such funds are expec-@ed to be needed. Any profit realized
from such investments may be used by the City to pay the cost
of operation and administration of the System. Any loss re-
sulting -@rom such investments shall be charged to the Note
Fund.
ARTICLE V
Particular Covenants
Section 5.1. Payment of Notes. The City shall pay the
principal of and interest on the Notes as the same become due
and shall observe and perform all covenants, conditions and
agreements contained in the Notes and this resolution; pro-
vided, however, that such obligations are not general obliga-
tions of the City but are limited obligations payable solely
from the revenues pledged therefor. The Notes and the interest
thereon shall not be deemed to constitute a debt or a pledge of
the faith and credit of the Commonwealth of Virginia or any
political subdivision thereof, including the City. Nei.ther the
Commonwealth of Virgin@-a nor the City shal-1 be obligated to pay
the principal of or interest on the Notes or other costs inci-
dent thereto except from the revenues pledged therefor, and
neither the faith and credit nor the taxing power of the
Commonwealth of Virginia or any political subdivision thereof,
including the City, is pledged to the payment of the principal
of or interest on the Notes or other costs incident ther,eto.
Section 5.2. Operation and Maintenance. The City
shall establish and enfo.-ce reasonable rules and regulations
governing the use of and the services furnished by the System
and maintain and operate the System in good condition and re-
pair. The City shall comply with all valid acts, rules, regu-
lations, orders and directions of any legislative, executi-ve,
administrative or judicial body applicable to the System.
Section 5.3. Issuance of Other . So long
as any of the Notes are outstanding, the City will not, without
the prior written consent of the Noteholders, c.-eate, incur,
assume or guarantee any indebtedness or other obligation in
connection with the System secured by a lien on water or sewer
revenues which is superior to the lien thereon securing the
Notes. The City may, without the consent of any Noteholders,
create, incur, assume or guarantee any indebtedness or other
obligation in connection with the System secured by a lien or
charge upon part or all of the revenues of the Sys-@em ranking
equally with the lien and charge of the Notes.
6 / 2 98 2
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ARTICLE VI
Remedies of Noteholders
Section 6.1. Event of Default Defined. Each of the
following events is hereby declared an Event of Default:
(a) Failure to pay principal of or interest on any
of the Notes when the same shall become due and payable.
(b) Default on the part of the City in the due and
punctual performance of any of the covenants, conditions,
agreements and provisions contained in the Notes or in this
resolution and to be performed by it, and such default shall
have continued for 60 days after written notice specifying such
default and requiring the same to be remedied shall have been
filed with the City by the holders of not less than 50% in ag-
gregate principal amount of tlie Notes then outstanding;
(c) The System or any substantial part thereof
shall be destroyed or damaged and for any reason shall not be
promptly repaired, replaced or reconstructed; or
(d)' Appointment by a court of competent jurisdic-
tion of a receiver for the System or approval by any such court
of any petition for reorganization of the City or rearrangement
or readjustment of the City's obligation under the provisions
of any applicable bankruptcy laws.
Section 6.2. Remedies upon Default. Upon the happen-
ing of an Event of Default, the liotel-iolders shall have the fol-
lowing rights and reinedies:
(a) The holders of not less than 50% in aggregate
principal amount of the Notes then outstanding may, by written
notice filed with the City Manager, declare the principal of
the Notes then outstanding to be immediately due and payable,
and upon such declaration such Notes shall become and be imme-
diately due and payable, anything in the Notes or in this reso-
lution to the contrary notwithstanding. If, however, the City
shall thereafter make good such default and any other default
hereunder (except default in payment of principal of the Notes
so declared payable) the holders of not less than 20% in aggre-
gate principal amount of the Notes then outstanding shall, by
notice in writing filed with the City Manager, rescind and
annul such declaration and all its consequences, but no such
rescission or annulment shall affect any subsequent default or
right relative thereto.
(b) The holders of not less than 50% in aggregate
principal amount of the Notes then outstanding may proceed to
protect and enforce the rights of the Noteholders by a suit,
action or special proceeding in equity or at law, either for
the specific performance of any covenant or agreement or execu-
tion of any power, or for the enforcement of any proper legal
or equitable remedy as may be deemed most effectual to protect
and enforce such rights.
Section 6.3. Applicati,-.@ of @-loncys. @l'-l moneyf- --c..
ceived pursuant to any right given or action taken under the
provisions of this article shall, after payment of the cost and
6 / 2 9 / 8 2
expenses of the proceedings resulting in the coll.ection of such
moneys, be deposited in the Note Fund, and all moneys in the
Note Fund shall be applied as follows:
(a) Unless the principal of all the Notes shall
have become or shall have been declared due and payable, all
such moneys shall be applied:
First - To the payment to the persons entitled
thereto of all installments of interest then due on
the Notes, in the order of the maturity of the
installments of such interest and, if the amount
available shall not be sufficient to pay in full
any particular installment, then to the payment
ratably, according to the amounts due on such
installment, to the persons entitled thereto, with-
out any discrimination or privilege; and
Second - To the payment to the persons entitled
thereto of the unpaid installments of principal of
any of the Notes which shall have become due in the
order of the due dates of such installments, with
interest on such installments from the respective
dat6s upon which they become due and, if the amount
available shall not be sufficient to pay in full
install.ments due on any particular date, together
with such interest, then to the payment ratably,
according to the amount of the installment due on
such date, to the persons entitled thereto, without
any discrimination or privilege.
(b) If the principal of all the Notes shall have
become due or shall have been declared due and payable, all
such moneys shall be applied to the payment of the principal
and interest then due and unpaid upon the Notes, without pref-
erence or priority of principal over interest or of interest
over principal, or of any installment of interest over any
other installment of interest, ratably, according to the
amounts due respectively for interest and principal, to the
persons entitled thereto, without any discrimination or privi-
lege.
(c) If the principal of all the Notes shall have
been declared due and payable and if such declaration shall
thereafter have been rescinded and annulled under the provi-
sions of this article, then, subject to the provisions of sub-
section (b) of this section in the event that the principal of
all the Notes shall later become due or be declared due and
payable, the moneys shall be applied in accordance with the
provisions of subsection (a) of this sectiqn.
Whenever moneys are to be applied pursuant to the pro-
visions of this section, such moneys shall be applied at such
times and from time to time, having due regard to the amount of
such moneys available for application and the likelihood of
additional moneys becoming available for such application in
the future. Whenever such moneys shall be applied, a date
shall be fixed (which shall be an interest payment date unless
anotlior date '--e :,.or@ upoi-i which such app'@'@cz,-,
tion is to be made, and upon such date interest on the amounts
of principal to be paid on such dates shall cease to accrue.
6 / 2 9 / 8 2
- 2 0 -
Such notice as appropriate shall be made of the deposit of any
such moiaeys and of the fixi.ng of any such date, and no payment
shall be required to be made to the holder of any Note until
such Note shall be presented for appropriate endorsement or for
cancellation if fully paid.
Section 6.4. Restriction on Iidtoe@
4eiit Suits. No
Noteholder shall have any right to ilistitute any suit, action
or special proceeding in equity or at law for the execution of
any trust hereunder or for any other remedy hereunder except as
herein provided. It is uiiderstood and intended that no
Noteholder shall have any right in any manner whatever by his
action to affect, disturb or prejudice the security of this
resolution or to enforce any right hereunder except in the mal-
ner herein provided and that all proceedings in equity or at
law shall be instituted, had and maintained in the manner
herein provided and for the benefit of all Noteholders.
Nothing in this resolution or in the Notes shall affect
or impair the obligation of the City, which is absolute and
unconditional, to pay when the same shall respectively become
due and payable and at the place provided therein the principal
.of and interest on each of the Notes to the respective holders
thereof, or affect or impair the right of action, which is also
absolute and unconditional, of any holder to enforce such pay-
ment of his Note; provided, however, that such obligations are
not general obligations of the City but are limited obligations
payable solely from the revenues pledged therefor.
Sectiori 6.5. Waivers of Events of Default. Any Event
of Default shall be waived upon the written request of the hol-
ders of (a) a majority in aggregate principal amount of Notes
then outstanding in respect of which default in the payment of
principal and/or interest exists or (b) a majority in aggregate
principal amount of Notes then outstanding in the case of any
other default; provided, liowever, that there shall not be
waived without the consent of the holders of all Notes then
outstanding (1) any Event of Default in the paymnent of princi-
pal of any outstanding Notes at the date of maturity specified
therein or (2) any default in the payment when due of the in-
terest on any such Notes unless, prior to such waiver or re-
scission, all arrears of interest or all arrears of payments of
principal when due, as the case may be, shall@ have been paid.
Section 6.6. Restoration of Rights after Proceeding.
If any proceeding shall be undertakeil by Noteholders and there-
after shall be discontinued or abandoned, the City and the
Noteholders shall be restored to their former positions and
rights as if no proceeding had taken place.
Section 6.7. Direction of Proceedings by Noteholders.
Anything in this resolution to the contrary notwithstanding,
the holders of a majority in aggregate principal amoun-@ of the
Notes then outstanding shall have the right to direct the
method and place of conducting all remedial proceedings to be
taken hereunder; provided, however, that such direction shall
not be otherwise than in accordance With law or the provisi.ons
of this resolution.
Section 6.6. Delay and Wa@-ver. No delay or omission
on the part of the Noteholders to exercise any right or power
6/29/82
2 1 -
accruing upon any default or Event of Default shall impair any
such right or power or shall be construed to be a waiver of any
such default or Event of Default or acquiescence therein, and
every such right and power rray be exercised from time to time
as often as may be deemed expedient. No waiver of any default
or Event of Default hereunder by the Noteholders shall extend
to or shall affect any subsequent default or event of default
or shall impair any rights or remedies consequent thereon.
Section 6.9. Remedies Comulative. No remedy conferred
hereby is intended to be exclusive of any other remedy, and
every remedy shall be cumulat4-ve and in addition to every other
remedy herein or now or hereafter existing in equity, at law or
by statute.
ARTICLE VII
Amendments
Section 7.1. Amendments without Consent. The City
Council shall have the right, from time to time, without the
consent of any of the Noteholders to adopt resolutions supple-
mental hereto, not inconsistent with the terms and provisions
hereof:
(a) to cure any ambiguity or formal defect or
omission or to correct any inconsistent provisions in this res-
olution or in any supplemental resolution;
(b) to grant to or to confer upon the Noteholders
any additional lawful right, remedy, power, authority or secu-
rity; and
(c) to add other covenants and agreements to be
observed by the City Council or to surrender any right or power
herein reserved to or conferred upon the City Counci.
Secton 7.2. Amendments Requiring Consent. (a) The
holders of not less than two-thirds in aggregate principal
amount of the Notes then outs-tanding shall have the right, from
time to time, but only pursuant to this section, to consent to
and approve the adoption of such resolution or resolutions sup-
plemeiital hereto as shall be deemed necessary or desirable by
the City Council for the purpose of modifying, altering, amend-
ing, adding to or rescinding, in any particular, any of the
terms or provisions contained in this resolution or in any sup-
plemental resolution; provided, however, that nothing herein
contained shall permit or be construed as permitting (1) an
extension of the maturity of any installment of principal or
interest on any Note, or (2) a reduction in the principal
amount of any Note or the rate of interest the--eon, or (3)
except as provided in subsection (b) of this section, the crea-
tion of a lien upon or a pledge of revenues other than the lien
and pledge created by this resolution, or (4) a preference or
priority of any Note or Notes over any other Note or Notes, or
(5) a reduction in the principal amount of Notes required for
consent to such supplemental resolution. Nothing herein con-
tai.ned, however, shall be construed as mak@-no necessary tbe
approval by the Noteholders o-@ ',he adoption of any supplemental
resolution authorized by Section 7.1.
6 / 2 9 / 8 2
2 2 -
(b) The Notes and the Stock Purchase Contract pro-
vide that the security for the Notes is subject under certain
conditions set forth in the Stock Purchase Contract '@o substi-
tution at the option of the City. The holders of not less than
90% in aggregate principal amount of the Notes then outstanding
must approve the adoption of such resolution or supplemental
resolutions as shall be deemed necessary by the City Council
for the purpose of substituting such security. If the
Stockhol-ders (their personal representatives, trustee, heirs,
legatees, beneficiaries or descendants) are no longer holders
of any of the Notes, such approval shall not be unreasonably
withheld so long as the new security for the Notes is of sub-
stantially equal or greater value to the security for which it
is being substituted. So long as they are No-@eholders the ap-
proval of such substitution by the Stockholders shall be condi-
tioned as set forth in the Stock Purchase Contract.
Section 7.3. Adoption and Consent to Amendment. Upon
the adoption of any supplemental resolution for any of the pur-
poses of Section 7.2, a certified copy thereof shall be filed
in the office of the City Clerk for inspection by any
Noteholder. The C@-ty Clerk shall cause a copy of such supple-
mental resolution or a summary thereof, together with a request
.to the Noteholders for their consent thereto, to be sent by
registered or certified mail to each Noteholder at his address
as it appears on the registration books. If, within 60 days or
such longer period as shall be prescribed by the City Council
following the giving of such notice, the City Council shall
file in its office an instrument or instruments in writing pur-
porting to be executed by the holders of not less than
two-thirds in aggregate principal amount of the Notes then out-
standing, which shall refer to the supplemental resolution and
shall specifically consent to and approve the adoption thereof,
together with a certified copy of stich supplemental resolution
and the written opinion of counsel for the City stating that
such resolution has been dul.y adopted, is authorized or permit-
ted by this resolution and is valid and legally binding upon
the City and enforceable in accordance with its terms, such
supplemental resolution shall thereupon be effective as to the
holders of all the Notes then outstanding, whether or not such
holders shall have consented thereto.
Section 7.4. Amendment by Unanimous Consent.
Notwi-@hstanding any other provision herein, the City Council
may amend any term or provision of this resolution or any sup-
plemental resolution upon adoption of a supplemental resolution
and the filing of certified copies of such supplemental resolu-
tion, together with the written consent thereto of the holders
of all the Notes then outstanding, as provided in Section 7.3.
Section 7.5. Effect of Amendments. This resolution
shall be deemed modified and amended, and the respective
rights, duties and obligations hereunder of the City and all
holders of the Notes then outstanding shall be determined and
enforced under the provisions of this resolution, as so modi-
fied and amended, upon the effective date of any amendment as
provided in this article.
6 / 2 98 2
2 3-
ARTICLE VIII
Defeasance
Section 8.1. Discharge upon Payment of Notes. If the
Notes shall have become due and payable in accordance with
their terms or otherwise as provided in this resolution and the
full amount of the principal and in-,erest so due and payable
upon all the Notes then outstanding shall have been paid at the
time and in the manner provided therein and in this resolution,
or if the Note Fund contains cash or noncallable direct obliga-
tions of the United States of America the principal of and in-
terest on which at maturity will be sufficient to pay when due
the principal of and interest on all Notes then outstanding,
then the right, title and interest of the Noteholders in the
moneys, funds and securities pledged under this resolution and
all covenants, agreements and other obligations of the City to
the Noteholders under this resolution shall cease, terminate
and be void and the City shall be discharged from its obliga-
tions hereunder. In such event all moneys and securities not
required for the payment of principal and interest on the Notes
may be used by the City for any lawful purpose.
ARTICLE IX
Miscellaneous
Section 9.1. Contract with Noteholders. The provi-
sions of this resolution shall constitute a contract between
the City and the Noteholders for so long as any of the Notes
are unpaid or no provisions have been made for payment of the
Notes.
Section 9.2. Authority of Officers and Agents. The
officers and agents of the City shall do all acts and things
required of them by this resolution and.the Notes for the com-
plete and punctual performance of all the terms, covenants and
agreements contained herein and therein.
Section 9.3. Filing of Resolution and Publication of
Notice. The City Clerk is hereby authorized and directed to
see to the immediate filing of a certified copy of this resolu-
tion with the Circuit Court of the City of Virginia Beach and
within ten days thereafter to cause to be published once in a
newspaper having general circulation in the City a notice set-
ting forth (1) in brief and general terms the purpose for which
the Notes are to be issued and (2) the amount of the Notes.
Section 9.4. Limitation of Rights. Nothing expressed
or mentioned in or to be implied from this resolution or the
Notes is intended or shall be construed to give to any person
or company other than the parties hereto and the holders of the
Notes any legal or equitable right, remedy or claim under or in
respect to this resolution or any covenantsj conditions and
agreements herein contained in this resolution, and all of the
covenants, conditions and agreements hereof are intended to be
and are for the sole and exclusive benefit of the City and the
hoiders of the Notes as herein provided.
6 / 2 9 / 8 2
2 4 -
Section 9.5. Notice. Any provision in this resolution
for the giving, filing, mailing or delivery of notice or other
papers to the City shall be deemed fully complied with if and
when such notice or other papers are sent by first class regis-
tered or certified mail, return receipt requested, to the City
Attorney of the City of Virginia Beach, Municipal Center,
Virginia Beach, Virginia 23456.
Section 9.6. Headings. Any headings in this resolu-
tion are solely for convenience of reference and shall not con-
stitute a part of the resolution nor shall they affect its
meaning, construction or effect.
Section 9.7. Conditions Precedent. Upon the issuance
of any Notes all acts, conditions and things required by the
Constitution and statutes of the Commonwealth of Virginia or by
this resolution to have happened, exist and to have been per-
formed precedent to or in the issuance of such Notes shall have
happened, exist and have been performed.
Section 9.8. Severability. The provisions of this
resolution are hereby declared to be severable. If any court
of competent jurisdiction shall hold any provision of this res-
olution to be invalid and unenforceable, such holding shall not
invalidate any other provision hereof.
Section 9.9. Effective Date. This resolution shall
take effect immediately.
6 2 9 8 2
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ITEM #18415
Upon motion by Councilman Buchanan, seconded by Councilman Holland, City
Council voted to ADOPT the Resolution authorizing the issuance of
$1,800,000 Water and Sewer Revenue Notes (Kempsville Utilities) of the
City of Virginia Beach, Virginia, and providing for the form, details
and payment thereof.
Voting: 7-3*
Council Members Voting Aye:
John A. Baum, E. T. Buchanan, F. Reid Ervin, Vice
Mayor Harold Heischober, Clarence A. Holland, M.D.
Mayor J. Henry McCoy, Jr., D.D.S., and Patrick L.
Standing
Council Members Voting Nay:
Barbara M. Henley, Reba S. McClanan, and Meyera E
Oberndorf
Council Members Absent:
W. H. Kitchin, III
*VERBAL ROLL CALL
A RESOLUTION AUTHORIZING THE ISSUANCE OF $1,800,000
WA@-ER AND SEWER REV'@-NUE NOTES (KEMPSVILLE UTILITIES)
OF THE CITY OF VIR-IT@NIA BEAI-H, VIRGIN-IA, PRO-
VIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF
WHEREAS, as a part of a program for acquiring water and
sewer facilities located within the boundaries of the City of
Virgiiiia Beach (the City), the City Council has determined that
it is desirable to acquire the sewer system of Kempsville
Utilities Corporation (the Corporation); and
WHEREAS, the City proposes to acquire such system by
the purchase of all of the stock of the Corporation and follow-
ing such acquisition to dissolve the Corporation and to inte-
grate its sewer system into the City's water and sewer system;
and
WHEREAS, the City has entered into a contract with the
owners of all the stock of the Corporation for the purchase of
such stock; and
WHEREAS, the City Council by ordinance adopted on June
28, 1982, has authorized the issuance of water and sewer reve-
nue notes in an amount not to ekceed $1,800,000, as contem-
plated by the foregoing contract;
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF VIRGINIA
BEACH, VIRGINIA:
ARTICLE I
Definitions
Section 1.1. Definitions. Whenever used in this reso-
lution, unless a different meaning clearly appears from the
context, the following words and terms shall have the following
meanings:
"City" shall mean the City of Virginia Beach, Virginia.
I,City Council" shall mean the Council of the City of
Virginia Beach, Virginia.
"Corporation" shall mean Kempsville Utilities
Corporation, a Virginia public service corporation.
"Event of Default" shall mean any of the events enumer-
ated in Section 6.1.
"Interest Account" shall mean the Interest Account
.n
the Note Furid established by Section 3.2.
"Net Revenuesti shal@l mean the revenues derived from the
ownership and operation of the System less costs of operation,
administration and insurance.
"Note Fund" shall mean the Water and Sewer Revenue Note
Fund: Kempsville Utilities, established by Section 3.2.
"Noteholder" shall mean the registered owner of any
Note.
6/29/82
"Notes" shall mean water and sewer revenue notes in an
aggregate principal amount not to exceed $1,800,000 authorized
herein.
"Principal Account" shall mean the Principal Account in
the Note Fund established by Section 3.2.
"Stockholders" shall mean the owners of all the stock
of the Corporation.
"Stock Purchase Contract" shall mean the agreenent be-
tween the Stockholders and the City dated June _, 1982.
"System" shall mean the water and sewer system of the
City, as it may exist from time to time, and shall include the
sewer system of the Corporation.
ARTICLE II
Details, Execution, Form and Registration of Notes
Section 2.1. Authorization of -Notes. There are hereby
authorized to be issued water and sewer revenue notes of the
City in the aggregate principal amount of One Million Eight
Hundi-ed Thousand Dollars ($1,800,000), or such lesser amount as
the City Manager may determine to be required by the Stock
Purchase Contract, to provide funds, together with other funds
that may be available, to finance the cost of acquiring certain
sewer facilities located in the City through the purchase of
all the stock of the Corporation. The Notes shall be designa-
ted "Water and Sewer Revenue Notes (Kempsville Utilities)".
Section 2.2. Details of Notes. The Notes shall be
issued as fully registered Notes in various denominations with-
out coupons, shall be numbered from R-1 upward, shall be dated
the date of their delivery, shall bear interest from their date
at the rate of 10% per year, payable semiannually on the last
day of each February and August, beginning February 28, 1983,
and shall be payable in principal installmei-its of $72,000 on
August 31 in each of the years 1983 to 2007, inclusive, without
option of prior prepayment. Both principal and interest shall
be payable in lawful money of the United States of America, but
only from revenues pledged to the payment thereof as herein-
after provided. Principal and interest shall be payable by
check or draft mailed to the registered owners at their
addresses as they appear on registration books to be kept by
the City Treasurer, as Registrar, except that the final
installment of principal and interest shall be payable upon
surrender of the Notes at the office of the City Treasurer.
Section 2.3. Execution of Notes. The Notes shall be
signed by the Mayor of the City, shall be countersigned by its
Clerk, and its seal shall be affixed thereto.
Section 2.4. Form of Notes. The Notes shall be in
substantially the following form:
6 / 2 9 / 8 2
2
(Forn. of Note)
No. R-
UNITED STATES OF AMERICA
COMMONWEALTH OF VIRGINIA
CITY OF VIRGINIA BEA--H
The City of Virginia Beach, Virginia, for value re-
ceived, hereby acknowledges itself indebted and promises to
pay, solely from the source and as hereinafter provided, to
the principal sum of
DOLLARS ($
with interest hereon from the date hereof until payment at the
rate of ten percent (10%) per year. Principal is payable in
installments of $ on August 31 in each of the years
1983 to 2007, inclusive, without option of prior redemption.
Interest on the unpaid principal is payable semiannually on the
last day of each February and August, beginning February 28,
1983. Principal and interest shall be paid by check or draft
mailed to the registered owner at his address as it appears on
the registration books kept by the City Treasurer, as
Registrar, except that the final installment of principal and
interest shall be paid upon surrender of this note at the main
office of the City Treasurer. Both principal and interest
shall be paid in lawful money of the United States of America.
This note is one of an issue of $1,800,000 water and
sewer revenue notes of like date and tenor, except as to number
and denomination, issued pursuant to an agreement between all
of the stockholders (the Sellers) of kempsville Utilities
Corporation (the Corporation) and the City dated June -1 1982
(the Agreement), for the sale by the Sellers and the purchase
by the City of all the capital stocr of the Corporation as the
owner of a sewer system in the City. Reference is he.-eby made
to a resolution of the City Council adopted on June 28, 1982,
for a description of the property pledged and the provisions,
among others, with respect to the nature and extent of the se-
curity, the rights, duties and obligations of the City, the
rights of the holders of the notes and the terms upon which the
notes are issued and secured.
This note and the issue of which it is a part and the
interest thereon are limited obligations of the City payable
solely from the net revenues derived from the ownership and
operation of the City's water and sewer system, as the same may
from time to time exist. The City is required to charge rates
or fees to users of its water and sewer system and fix and
maintain such rates or fees at such level as will produce suf-
ficient revenue to pay all costs of operation of such system
and the principal of and itterest on the iioles and any obliga-
tions heretofore or hereafter issued on account of such system
and secured by a pledge of water or sewer revenues, as the same
6 / 2 9 / 8 2
9-
respectively become due. The notes and the interest thereon
shall not be deeined to constitute a debt or a pledge of the
faitli and credit of the Commonwealth of Virginia or any polit-
ical subdivision thereof, including the City. Neither the
Commonwealth of Virginia nor any p6litical subdivision thereof,
including the City, shall be obligated to pay the principal of
or interest on this note or other costs incident thereto except
from the revenues pledged -@herefor, and neither the @laith and
credit nor the taxing power of the Commonwealth of Virginia or
any political subdivision thereof, including the City, is
pledged to the payment of the principal of or interest on the
notes or other costs incident thereto.
The City shall have the right to offset against any
payinents of principal and interest due on this note any amounts
due the City pursuant to the Sellers,' indemnification provision
contained in the Agreement.
The security for this note is subject to substitution
at the option of the City for other security, as more specifi-
cally set forth in the Agreement.
IN WITNESS WHEREOF, the City of Virginia Beach,
Virginia, has caused this note to be signed by its Mayor, to be
countersigned by its Clerk, its seal to be affixed hereto, and
this note to be dated 1982.
Mayor, City of Virginia Beach,
Virginia
(SEAL)
COUNTERSIGNED:
Clerk, City of Virginia Beach,
Virginia
Section 2.5. Deliver f Not:ts. Upon the fulfillment
of all conditions to the City YSOB jig tions under the Stock
Purchase Contract, the Mayor and the City Clerk are hereby au-
thorized and directed to have the Notes prepared and executed
in accordance with their terms and to deliver the Notes to the
Stockholders pursuant to the Stock Purchase Contract.
Section 2.6. Registration of Notes. The City
Treasurer shall act as Registrar and shall maintain books for
the registration of the Notes. The Notes are being issued to
the Stockholders in registered form in payment for the purchase
of stock of the Corporation and shall be registered in the
names of others on.1-v i.n t@e c,,f (,j.ft tc of i
Noteholder's immediate family, death of a Noteholder or trans-
fer of a Note by operation of law and upon receipt by the City
Treasurer of evidence thereof satisfactory to him.
6/29/P
30-
Section 2.7. Replacement of Mutilated, Lost or
Destroyed Note. Should any of the Notes become mutilated or be
lost or destroyed, the City Council, subject to approval of the
State Commission on Local Debt, shall cause to be executed and
delivered a new Note of like date and tenor in exchange and
substitution for, and upon cancellation of, such mutilated
Note, or in lieu of and in substitution for such lost or de-
stroyed Note. Such new Note shall be executed and delivered
only when the holder has (a) paid all reasonable expenses and
charges in connection therewith and (b) in the case of a lost
or destroyed Note, has (1) filed iiith the City Treasurer evi-
dence satisfactory to him that sucli Note was lost or destroyed
and that he was the owner thereof and (2) furnished to the City
Treasurer indemnity satisfactory to him.
ARTICLE III
Revenues and Note Fund
Section 3.1. Revenue Covenant. The City Couricil cove-
nants that so long as any of the Notes are outstanding and
unpaid the City will:
(a) charge rates or fees to users of the System
and fix and maintain such rates or fees at such level as will
produce sufficieiit revenues to pay the cost of operation and
administration, the cost of insurance against loss by injury to
persons or property and the principal of and interest on the
Notes and any other notes or bonds heretofore or hereafter
issued on account of the System and secured by a pledge of
water or sewer revenues, as the same respectively beconie due;
(b) apply the revenues derived from the ownership
and operation of the System in each fiscal year first to the
payment of such costs of such operation, administraton and in-
surance during such year, then to the payment of the Notes and
any other bonds or notes heretofore or hereafter issued on
account of the System and secured by a pledge of water or sewer
revenues becoming due in such year; and
(c) segregate and keep segregated from all other
City funds all revenues derived from the ownership and opera-
tion of the System and keep proper records and accounts there-
for, separate and apart from all other records and accounts.
Section 3.2. Note Fund. There is hereby established
the Water and Sewer Revenue NoEe Fund: Kempsville Utilities,
which shall be held by the City's Director of Finance.
(a) At least one business day before the last day
of each February and August the City's Director of Finance
shall deposit into the Interest Account from Net Revenues such
amount, if any, as may be required to make the total amount on
deposit therein equal to the amount of interest which will be-
come due on the Notes on the next interest payment date. The
Interest Account shall be used solely for the paymen-@ of inter-
es-, o!7@ '@he llo-@es.
(b) At least one business day before each
August 31 until paymert of the Notes, the City's Director of
6 / 2 9 / 8 2
Finar.ce sliall deposit $72,000 into the Principal Account from
Net Revenues. The Principal Account shall be used solely for
the payment of the principal of the Notes (whether at maturity
or otherwise).
Section 3.3. Pledge of Net Revenues and Note Fund.
All Net Revenues are hereby pledged to the payment of the prin-
cipal of and interest on the Notes and any other bonds or notes
heretofore or hereafter issued on account of the System and
secured by a pledge of water or sewer revenues. All moneys in
the Note Fund shall be trust funds and are hereby pledged to
the payment of the principal of and interest on the Notes. The
lien and trust created hereby are for the benefit of the
Noteholders and for their additional security until all of the
Notes have been paid.
Section 3.4. Parity Obligations. The Notes shall be
on a parity with other obligations of the City heretofore
issued and payable from Net Revenues. Subject to Section 5.3,
the City reserves the right to issue additional bonds or notes
payable from either gross revenijes or Net Revenues, with or
without a pledge of its full faith and credit, ranking equally
with the lien and charge of the Notes.
ARTICLE IV
Securit@ for Deposits and Investment of Note Fund
Section 4.1. Security for Deposits. All moneys in the
Note Fund and on deposit with any bank or trust company in
Virginia shall be con-linuously secured in the manner required
by the Virginia Security for Public Deposits Act (Chapter 23,
Title 2.1, Code of Virginia of 1950, as amended), or any suc-
cessor provision of law.
Section 4.2. Investment of Funds. Moneys in the Note
Fund inay, pending their use, be invested in (a) bonds, notes
and other obligations of the United States of America and
securil.ies unconditionally guaranteed as to payment of princi-
pal and interest by the United States of America or any agency
thereof, (b) savings accounts, time deposits and certificates
of deposit in any bank within the Commonwealth of Vi-rginia,
provided such bank is approved for the deposit of funds by the
Commonwealth, (c) savings accounts and certificates of (1) sav-
ings and loan associations that are under the supervision of
the Commonwealth of Virginia and (2) Federal associations orga-
nized under the laws of the United States of America and under
Federal supervision, but only to the extent that such accounts
and certificates are fully insured by the Federal Savings and
Loan Insurance Corporation or any successor Federal agency, and
(d) any other investments which are now or may hereafter be
authorized by law for the investment of public sinking funds.
Any bonds, notes or other obligations listed in subsection (a)
above may be purchased pursuant to a repurchase agreement with
any bank within or without the Commonwealth of Virginia having
a combined capital, surplus and undivided profits of not less
than $10,000,000. Investments so purchased shall be considered
tc@ ci,@ tl-.@ date -@he brnk -.'s ob'@igated ,,i @i,ch
securities. A repurchase agreement for securities described in
subsection (a) above shall bo considered a purchase of such
6 / 2 9 / 8 2
3
securities even if title and/or possession of such,securities
is not transferred to the City so long as the repurchase obli-
gation of the bank is collateralized by the securities them-
selves, the securities have on the date of the repurchase
agreement a fair market value equal to at least 100% of the
amount of the repurchase obligation of the bank and the securi-
ties are held by a third party and segregated from securities
owned generally by the bank. Moneys in the Note Fund shall not
be invested in securities or deposits maturing later than the
date such funds are expected to be needed. Any profit realized
from such investments may be used by the City to pay the cost
of operation and administration of the System. Any loss re-
sulting from such investments shall be charged to the Note
Fund.
ARTICLE V
Particular Covenants
Section 5.1. Payinent of Notes. The City shall pay the
principal of and interest on the Notes as the same become due
and shall observe and perform all covenants, conditions and
agreements contained in the Notes and this resolution; pro-
vided, however, that such obligations are not general obliga-
tions of the City but are limited obligations payable solely
from the revenues pledged therefor. The Notes and the interest
thereon shall not be deemed to constitute a debt or a pledge of
the faitli and credit of the Commonwealth of Virginia or any
political subdivision thereof, including the City. Neither the
Commonwealth of Virginia nor the City shall be obligated to pay
the principal of or interest on the Notes or other costs inci-
dent thereto except from the revenues pledged therefor, and
neither the faith and credit nor the taxing power of the
Commonwealth of Virginia or any political subdivision thereof,
including the City, is pledged to the payment of the principal
of or interest on the Notes or other costs incident thereto.
Section 5.2. Operation and Maintenance. The City
shall establish and enforce reasonable rules and regulations
governing the use of and the services furnished by the System
and maintain and operate the System in good condition and re-
pair. The City shall comply with all valid acts, rules, reg-u-
lations, orders and directions of any legislative, executive,
administrative or judicial body applicable to the System.
Section 5.3. Issuance of Other Obligations. So long
as any of the Notes are outstanding, the City will not, without
the prior written consent of the Noteholders, create, incur,
assume or guarantee any indebtedness or other obligation in
connection with the System secured by a lien on water or sewer
revenues which is superior to the lien thereon securing the
Notes. The City may, without the consent of any Noteholders,
creAte, incur, assume or guaraiitee any indebtedness or other
obligation in connection with the System secured by a lien or
charge upon part or all of the revenues of the System ranking
equally with the li.en and charge of the Notes.
6 / 2 98 2
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ARTICLE VI
Remedies of Noteholders
Section 6.1. Event of Default Defined. Each of the
following events is hereby declared an Event of Default:
(a) Failure to pay principal of or interest on any
of the Notes when the same shall become due and payable.
(b) Default on the part of the City in the due and
punctual performance of any of the covenants, conditions,
agreements and provisions contained in the Notes or in this
resolution and to be performed by it, and such default shall
have continued for 60 days after written notice specifying such
default and requiring the same to be remedied shall have been
filed with the City by the holders of not less than 50% in ag-
gregate principal amount of the Notes then outstanding;
(c) The System or any substantial part thereof
shall. be destroyed or damaged and for any reason shall not be
promptly repaired, replaced or reconstructed; or
(d) Appointment by a court of competent jurisdic-
tion of a receiver for the System or approval by any such court
of any petition for reorganization of the City or rearrangement
or readjustment of the City's obligation under the provisions
of any applicable bankruptcy laws.
Section 6.2. Remedies upon Default. Upon the happen-
ing of an Event of Default, the Noteholders shall have the fol-
lowing rights and remedies:
(a) The holders of not less than 50% in aggregate
principal aii,,ount of the Notes then outstanding may, by written
notice filed with the City Manager, declare the principal of
the Notes then outstanding to be i=ediately due and payable,
and upon such declaration such Notes shall become and be imme-
diately due and payable, anything in the Notes or in this reso-
lution to the contrary notwithstanding. If, however, the City
shall thereafter make good such default and any other default
hereunder (except default in payment of principal of the Notes
so declared payable) the holders of not less than 20% in aggre-
gate principal amount of the Notes then outstanding shall, by
notice in writing filed with the City Manager, rescind and
annul such declaration and all its consequences, but no such
rescission or annulment shall affect any subsequent default or
right relative thereto.
(b) The holders of not less than 50% in aggregate
principal amount of tlie Notes then outstandilig may proceed to
protect and enforce the rights of the Noteholders by a suit,
action or special proceeding in equity or at law, either for
the specific performance of any covenant or agreement or execu-
tion of any power, or for the enforcement of any proper legal
or equitable remedy as may be deemed most effectual to protect
and enforce such rights.
0.@. ipplicaLior, of MoilF--ys. 1 inoricys ;:c-
ceived pursuant to any right given or action taken under the
provisions of this article shall, after pattent of the cost and
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3 4-
expenses of the proceedi-ngs resulting in the collection of such
moneys, be deposited in the Note Fund, ai-id all- moneys in the
Note Fund shall be applied as follows:
(a) Unless the pr-'@ncipal of all@ the Notes shall
have become or shall have been declared due and payable, all
such moneys shall be applied:
First - To the payment to the persons entitled
thereto of all instal-lments of interest then due on
the Notes, in the order of the maturity of the
installments of such interest and, if the amount
available shall not be sufficient to pay in full
any particular installment, then to the payment
ratably, according to the amounts due on such
installment, to the persons entitled thereto, with-
out any discrimination c-@- p.-ivilege; and
Second - To the payment to the persons entitled
thereto of the unpaid installments of principal of
any of the Notes which shall have become due in the
order of the due dates of such installments, with
interest on such installments from the respective
dates upon wh4-ch they become due and, if the amount
available shall not be sufficient to pay in full
installments diie on any particiilar date, together
with such interest, then to the payment ratably,
according to the amount of the installment diie on
such date, to the persons entitled thereto, without
any discrimination or privilege.
(b) If the principal ol@ all the Notes shall have
become due or shall have been decl.ared due and payable, all
such moneys shall be applied to tl,.e payment of the principal
and interest then due and unpaid upon the Notes, without pref-
erence or priority of principal over interest or of interest
over principal, or of any installment of interest over any
other installment of interest, ratably, accord4@ng to the
amounts due respectively for interest and principal, to the
persons entitled thereto, without any discrimination or privi-
lege.
(c) If the principal of all the Notes shall have
been declared due and payable and if such declaration shall
thereafter have been rescinded and anrulled under the provi-
sions of this article, then, subject to the provisions of sub-
section (b) of this section in the e-,7ent that the principal of
all the Notes shall later become due or be declared due and
payable, the moneys shall be applied in accordance with the
provisions of subsection (a) of this secti6n.
Whenever inoneys are to be applied pursuant to the pro-
visions of this section, such moneys shall be applied at such
tirnes and from time to time, having due regard to the amount of
such moneys available for application and the likelihood of
additional moneys becoming available for such application in
the future. Whenever such moneys shail- be applied, a date
shall be fixeo. @1,F)l be an intere.,t T,,a,7mp-nt .iate 1)nless
another date shall be rnore suitable) upon w@4.ch such applica-
tion is to be made, and upon such date interc-st on the amouilts
of principal to be paid on such dates shall cease to accrue.
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Such notice as appropriate shall be made of the deposit of any
such moneys and of the fixing of any such date, and no payment
shall be required to be made to the holder of any Note until
such Note shall be presented for appropriate endorsement or for
cancellation if fully paid.
Section 6.4. Restriction on InSLependent Suits. No
Noteholder shall have any right to @@nstitute any suit, action
or special proceeding in equity or at law for the execution of
any trust hereunder or for any other remedy hereunder except as
herein provided. It is understood and intended that no
Noteholder shall have any right in any manner whatever by his
action to affect, disturb or prejudice the security of this
resolution or to enforce any right hereunder except in the man-
ner herein provided and that all proceedings in equity or at
law shall be instituted, had and maintained in the manner
herein provided and for the benefit of all Noteholders.
, Nothing in this resolution or in the Notes shall affect
or impair the obligation of the City, which is absolute and
unconditional, to pay when the same sliall respectively become
due and payable and at the place provided therein the principal
of and interest on each of the Notes to the respective holders
thereof, or affect or impair the right of action, which is also
absolute and unconditional, of any holder to enforce such pay-
ment of his Note; provided, however, that such obligations are
not general obligations of the City but are limited obligations
payable solely from the revenues pledged therefor.
Section 6.5. Waivers of Events of Default. Any Event
of Default shall be waived upon the written request of the hol-
ders of (a) a majority in aggregate principal amount of Notes
then outstanding in respect of which default in the payment of
principal and/or interest exists or (b) a majority in aggregate
principal amount of Notes then outstanding in the case of any
other default; provided, however, that there shall not be
waived without the consent of -@he holders of all Notes then
outstanding (1) any Event of Default in the paymnent of princi-
pal of any outstanding Notes at the date of maturity specified
therein or (2) any default i.n the payment when due of the in-
terest on any such Notes unless, prior to such waiver or re-
scission, all arrears of interest or all arrears of payments of
principal when due, as the case may be, shall have been paid.
Section 6.6. Restoration of Rights after Proceeding.
If any proceeding shall be undertakeii by Noteholders and there-
.@after shall be discontinued or abandoned, the City and the
Noteholders shall be restored to their former positions and
rights as if no proceeding had taken place.,
Section 6.7. Direction of Proc
Anything in this resolution to the contrary notwithstandi-na-,
the holders of a majority in aggrega-@e principal amount of the
Notes then outstanding shall have the right to direct the
method and place of conducting all remedial proceedings to be
taken hereunder; provided, however, that such direction shall
not be otherwise than in accordance with law or the provisioiis
of thi-s resoltition.
Section 6.8. Delay and Waiver. No delay or omission
on the part of the Noteholders to exercise aiiy right or power
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3 6 -
accruing upon any default or Event of Default shall impair any
such right or power or shall be construed to be a waiver of any
such default or Event of Default or acquiescence therein, and
every such right and power may be exercised from tinie to time
as often as may be deemed expedient. No waiver of any default
or Event of Default hereunder by the Noteliolders shall extend
to or shall a@-fect any subsequent de-lault or event of default
or shall impair any rights or remedies consequent thereon.
Section 6.9. Remedies Comulative. No remedy conferred
hereby is intended to be exclusive of any otlier remedy, and
every remedy shall be cumulative and in addition to every other
remedy herein or now or hereafter existing in equity, at law or
by statute.
ARTICLE VII
Arr,endments
Section 7.1. Arnendments without Consent. The City
Council shall have the right, from time to time, without the
6onsent of any o@ the Noteholders to adopt resolutions supple-
mental hereto, not inconsistent with the terms and provisions
hereof: I
(a) to cure any ambiguity or formal defect or
omission or to correct any inconsistent provisions in this res-
olution or in any supplemental resolution;
(b) to grant to or to confer upon the Noteholders
any additional lawful right, remedy, power, autl-iority or secu-
rity; and
(c) to add other covenants and agreements to be
observed by the City Council or to surrender any right or power
herein reserved to or conferred upon the City Counci.
Secton 7.2. Amendments Requiring Consent. (a) The
holders of not less than two-thirds in aggregate principal
amount of the Notes then outstanding shall have the right, from
time to time, but only pursuant to this section, to consent to
and approve the adoption of such resolution or resolutions sup-
plemental hereto as shall be deemed necessary or desirable by
the City Council for the purpose of modifying, altering, amend-
ing, adding to or resc-'nding, in any particular, any of the
terms or provisions contained i-n this resolution or in any sup-
plemental resolution; provided, however, that nothing herein
contained shall permit or be construed as permitting (1) an
extension of the maturity of any installment of principal or
interest on any Note, or (2) a reduction in the principal
amount of any Note or the rate of interest thereon, or (3)
except as provided in subsection (b) of this section, the crea-
tion of a lien upon or a pledge of revenues othor than the lien
and pledge created by this resolution, or .(4) a preference or
priority of anv Note or Notes over any other Note or Notes, or
(5) a reduction in the principal amount of Notes required for
c;or,
tained, however, shall be construed as making necessary the
approval by the Noteholders of the adoption of any suppleniental
resolution author4-zed by Section 7.1.
6 / 2 9 / 8 2
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(b) The Notes and the Stock Purcliase Contract pro-
vide that the security for the Notes is subjec-@ under certain
conditions set forth in the Stock Purchase Contract to substi-
tution at the option of the City. The holders of not less than
90% in aggregate princidal amount of the Notes then outstanding
must approve the adoption of such resolution or supplemental
resolutions as shall be deemed necessary by the City Council
for the purpose of substituting such security. If the
Stockholders (their personal representatives, trustee, heirs,
legatees, beneficiaries or descendants) are no longer holders
of any of the Notes, such approval shall not be unreasonably
withheld so long as the new security for the Notes is of sub-
stantially equal or greater value to the security for which it
is being substituted. So long as they are No@@eholders the ap-
proval of such substitution by the Stockholders shall be condi-
tioned as set forth in the Stock Purchase Contract.
Section 7.3. Adoption and Coiisent to Amendment. Upon
the adoption of any supplemental resolution for any of the pur-
poses of Section 7.2, a certif4-ed copy thereof shall be filed
in the office of the City Clerk for inspection by any
Noteholder. The City Clerk shall cause a copy of such stipple-
mental resolution or a su=ary thereof, together with a request
to the Noteholders for their consent thereto, to be sent by
registered or certified mail to each Noteholder at his address
as it appears on the registration books. If, within 60 days or
such longer period as shall be prescribed by the City Council
following the giving of such notice, the City Council shall
file in its office an instrument or instruments in writing pur-
porting to be executed by the holders of not less than
two-thirds in aggregate principal amount of the Notes then out-
standing, which shall refer to the supplemental resolution and
shall specifically consent to and approve the adoption thereof,
together with a certified copy of such supplemental resolution
and the written opinion of counsel for the City stating that
such resolution has been duly adopted, is authorized or permit-
ted by this resolution and is valid and legally binding upon
the City and enforceable in accordance with its terms, such
supplemental resolution shall thereupon be effective as to the
holders of all the Notes then outstanding, whether or no-, such
holders shall have consented thereto.
Section 7.4. Amendment by Unanimous Consent.
Notwithstanding any other provision herein, the City Council
may amend any term or provision of this resolution or any sup-
plemental resolution upon adoption of a supplemental resolution
and the filing of certified copies of such slipplemental resolu-
tion, together with the written consent thereto of the holders
of all the Notes then outstanding, as provided in Section 7.3.
Section 7.5. Effect of Amendments. This resolution
shall be deemed modified and amended, and the respective
rights, duties and obligations hereunder of the City and all
holders of the Notes then outstanding shall be determined and
enforced under the provisions of this resoluti@on, as so modi-
fied and amended, up6n the effective date of any amendment as
provided in this article.
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ARTICLE VIII
Defeasance
Section 8.1. Discharqe upon Pavment of Notes. If the
Notes shall have become due and payable in accordance with
their terms or o-lherwise as provided in this resollit@on and the
full amount of the principal and interest so due and payable
upon all the Notes then outstanding shall have been paid at the
time and in the manner provided therein and in this resolution,
or if the Note Fund contains cash or noncallable direct obliga-
tions of the Uiiited States of America the principal of and in-
terest on which at maturity will. be sufficient to pay when due
the principal of and interest on all Notes then outstanding,
then the right, title and interest of the Noteholders in -@he
moneys, funds and securities pledged under this resolution and
all covenants, agreeinents and other obligations of the Cill-y to
the Noteholders under this resolution shall cease, -erminate
and be void and the City shall be discharged from its obliga-
tions hereunder. In such event all moneys and securities not
required for the payment of principal and interest oil the Notes
may be used by the City for any lawful purpose.
ARTICLE IX
Miscellaneous
Section 9.1. Contract with Noteholders. The provi-
sions of this resolution shall constitute a contract between
the City and the Noteholders for so long as any of the Notes
are unpaid or no provisions have been made for payment of the
Notes.
Section 9.2. Authority of Officers and Aqents. The
officers and agents of the City shall do a 1 acts and things
required of them by this resolution and the Notes for -@he com-
plete and punctual performance of all the terrns, covenants and
agreements contained herein and therein.
Section 9.3. Filing of Resolution and Publication of
Notice. The City Clerk is hereby authorized and directed to
see to the immediate filing of a certified copy of this resolu-
tion with the Circuit Court of the City of Virginia Beach aild
within ten days thereafter to cause to be published once in a
newspaper having general circulation in the City a notice set-
ting forth (1) in brief and general terms the purpose for which
the Notes are to be issued and (2) the amount of the Notes.
Section 9.4. Limitation of Rights. Nothing expressed
or mentioned in or to be implied from this resolution or the
Notes is intended or shall be construed to give to any person
or company other than the parties hereto and the holders of the
Notes any legal or equitable right, remedy or claim under or in
respect to this resolution or any covenants, conditions and
agreements herein contained in this resolution, and all of the
covenants, conditions and agreeinents hereof are intended to be
and are @-oi: tlie so@@e aiid exclusive bei,.eiit cif Lhe Ci@@y axici .',!e
holders of the Notes as herein provided.
6/29/8"
Secti.on 9.5. Notice. Any i-i-i -@his resolution
for the giv4-ng, filing, mailing or c'.t,.14vary of rotice or other
papers to the City sliall be deemed @@ill,y complied witli if and
when such notice or other papers arf- se..nt by fi-rst cl.ass regis-
tered or certif-.ed mail, return receit:)t rc@ques-led, to the City
Attorney of the City of Virg4-nia Bea--h, Municipal Center,
Virginia Beach, Virginia 23456.
Section 9.6. Headings. Any headings in this resolu-
tion are solely for convenience of reference and shall not con-
stitute a part of the resolution nor shall they affect its
meaning, construction or effect.
Section 9.7. Conditions Precedent. Upon the issuance
of any Notes all acts, conditions and things re(Tdired by the
Constitution and statutes of the CorLiionwealth of Virginia or by
this resolution to have happened, exi.st aiid to have been pc-r-
formed precedent to or in the issuarce of such liotes shall liave
happened, exist and have been perfor,@led.
Section 9.8. Severability. The provisions of tliis
resolution are hereby declared to be severable. If any court
of competent jurisdiction shall hold any provision of this res-
olution to be invalid and unenforceable, such holding sliall not
invalidate any other provision hereof.
Section 9.9. Effective Date. This resolution shall
take effect immediately.
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ITEM #18416
The City Manager advised Council the City held it's first renegotiation
meeting with Cox Cable T.v. today (29 June 1982), and presented to
Council revised financial reports provided by Cox Cable.
The City Manager further advised that as a result of a previous meeting
with Cox Cable it was determined that the Company had inadvertently
failed to pay the City of Virginia Beach the 3% franchise fee on pay
t.v. revenues. The Company has forwarded a check to the City in the
amount of $200,320.00 and will send a check for the interest due on
this amount.
The City Manager thanked Council for their help and cooperation in this
area.
Councilwoman McClanan asked the City Manager if in the renegotiation
meetings was the City considering raising the 3% franchise fee?
The City Manager advised he raised that point today (29 June 1982),
as to their ability or desire to discuss the matter and Cox Cable
"did not close the door".
ITEM #18417
Councilman Holland thanked Councilman Ervin and his family for such a
delightful dinner on June 29, 1982 prior to the Council Meeting. it
was a real pleasure to be able to participate in the dinner.
Councilman Ervin advised he was unaware his family was going to attend
the dinner and he was very surprised.
ITEM #18418
Councilman Standing asked if the City Manager needed to make appointments
per his letter of June 29, 1982 for the Joint Operation-County/Kempsville
Utilities.
The City Manager advised with Council concurrence this could be handled
administratively and he had presented a copy of the letter to Council
for their information only.
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ITEM #18419
Councilman Baum advised "he gathers Council is going to bring you four
(4) "retreads" back and frankly I am going to miss the four (4) of you."
A D J 0 U R N M E N T
ITEM #18420
Upon motion by Councilman Holland, City Council adjourned at 5:45 p.m.
Rdth Hodges Sfnith, CMC, City Clerk Mayor J. Henry McCoy, Jr., D.D.S.
City of Virginia Beach,
Virginia
29 June 1982 - Special Meeting
dmh