notice-of-sale--pos-final---central-ar-water

This Official Notice of Sale does not alone constitute an invitation for bids on the Bonds but is merely notice of the sale of the Bonds described herein The invitation for bids is being made by means of this Official Notice of Sale together with the Preliminary Official Statement Information contained in this Official Notice of Sale is qualified in its entirety by the detailed information contained in the Preliminary Official Statement Terms not defined in this Official Notice of Sale shall have the meanings assigned in the Preliminary Official Statement OFFICIAL NOTICE OF SALE Dated February 2, 2016 $22,915,000 * CENTRAL ARKANSAS WATER ACQUISITION AND CONSTRUCTION WATER REVENUE BONDS (MAUMELLE WATER SYSTEM ACQUISITION PROJECT), SERIES 2016 Bids Due: February 10, 2016 at 10:00 a.m., Central Standard Time The Bonds are issued pursuant to and in full compliance with the constitution and laws of the State of Arkansas, including particularly Act No 982 of the Acts of Arkansas of 2001 (Ark Code Ann § 25-20-301, et seq., (the “Act”)), and pursuant to a Trust Indenture, dated as of March 1, 2016 (the “Indenture”), duly executed and delivered by the Issuer to Regions Bank, as Trustee (the “Trustee”), and not constitute an indebtedness of the State of Arkansas or the Cities of Little Rock or North Little Rock, Arkansas, within any constitutional or statutory limitation The Bonds are not general obligations of the Issuer, but are special obligations payable solely from Long Term Debt Surcharge Revenues (as defined below) derived from the operation of the MWM Water System (as defined below) and from funds and moneys pledged to the payment of the Bonds under the Indenture The Issuer has no taxing power Electronic bids, via i-Deal LLC’s BiDCOMP™/Parity™ Competitive Bidding System (“BiDCOMP/Parity”) for the purchase of all, and not less than all, of the $22,915,000* aggregate principal amount of Acquisition and Construction Water Revenue Bonds (Maumelle Water System Acquisition Project), Series 2016 (the “Bonds”), will be received by the Issuer until 10:00 a.m., Central Standard Time, on February 10, 2016, (unless changed as described herein) THE BONDS Description of the Bonds The Bonds will be dated March 1, 2016 Interest will be payable on October 1, 2016, and on each April and October thereafter until the earlier of maturity or redemption The Bonds will be issued in fully registered form without coupons, and will be in denominations of $5,000 or any integral multiple thereof Principal and interest will be paid by the Trustee * Amount preliminary; subject to adjustment as described herein under “Adjustment to Principal Amount.” Principal Amortization Principal on the Bonds will be paid (subject to prior redemption) through serial maturities and/or term maturities with annual sinking fund redemptions on the following dates and in the following amounts: Required Principal Payment $ 410,000.00 495,000.00 505,000.00 520,000.00 535,000.00 550,000.00 565,000.00 585,000.00 600,000.00 620,000.00 640,000.00 660,000.00 680,000.00 700,000.00 720,000.00 740,000.00 765,000.00 785,000.00 810,000.00 840,000.00 865,000.00 895,000.00 930,000.00 960,000.00 995,000.00 1,030,000.00 1,070,000.00 1,105,000.00 1,150,000.00 1,190,000.00 Due April 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 Serial Bonds, Term Bonds, and Mandatory Sinking Fund Redemption The successful bidder may provide in the Official Bid Form for all of the Bonds to be issued as serial bonds or may designate consecutive annual principal amounts of the Bonds to be combined into term bonds Each such term bond shall be subject to mandatory sinking fund redemption commencing on April of the first year which has been combined to form such term bond and continuing on April in each year thereafter until the stated maturity date of that term bond The amount redeemed in any year shall be equal to the principal amount for such year set forth in the amortization schedule The Bonds to be redeemed in any year by mandatory sinking fund redemption shall be redeemed at par and shall be selected by lot from among the Bonds of the maturity being redeemed Mandatory Redemption The Bonds are subject to mandatory redemption on April 1, 2019, from proceeds of the Bonds not needed to accomplish the Acquisition of the MWM Water System or to accomplish the Improvements, at par plus accrued interest to the redemption date Optional Redemption The Bonds are subject to optional redemption on and after April 1, 2026, at the election of the Issuer, in whole or in part on any date for which timely notice of redemption can be given under the terms of the Indenture, in inverse order of maturities unless the Trustee is otherwise directed by the Issuer, in which case, in such order of maturities as the Issuer may direct (and within each maturity as selected by the Trustee), at par plus accrued interest to the redemption date See the Preliminary Official Statement – THE BONDS for more information on the redemption provisions for the Bonds Special Optional Redemption The Bonds are subject to special optional redemption on and after October 1, 2016, at the election of the Issuer, in part, from surplus collections of the Long Term Debt Surcharge Revenues, on any interest payment date for which timely notice of redemption can be given under the terms of the Indenture, in inverse order of maturities (and within each maturity) as directed by the Trustee, at par plus accrued interest to the redemption date provided the Issuer is not in default on the Senior Debt, the Second Lien Debt or the Bonds or any subsequently issued Parity Debt “Surplus Collections” means all collections of the Long Term Debt Surcharge deposited to the Long Term Debt Surcharge Account in the Revenue Fund established pursuant to the Indenture not needed to pay current principal and interest charges on the Bonds See, PROJECTED SPECIAL OPTIONAL REDEMPTION in the Preliminary Official Statement Security The Bonds are secured by a pledge of the Long Term Debt Surcharge Revenues, as defined in the Indenture, derived from the operation of the water system to be acquired by the Issuer from the Maumelle Suburban Improvement District No 500 of Pulaski County, Arkansas, also known as “Maumelle Water Management” (the “MWM Water System”) which acquisition will be made pursuant to the provisions of that certain Water Consolidation Agreement dated as of October 13, 2015, by and between the Issuer and MWM (the “Agreement”) “Long Term Debt Surcharge Revenues” means 100% of the collections of the Long Term Debt Surcharge levied by the Issuer pursuant to Resolution 2015-15 to be collected from customers of the Issuer within the service area for the MWM Water System The pledge of the Long Term Debt Surcharge Revenues securing these Bonds are included in the Net Revenues of the Issuer which Net Revenues are pledged first to the repayment of Senior Debt (as defined in the Indenture) of the Issuer and second to the payment of the Second Lien Debt (as defined in the Indenture) of the Issuer Thus, the pledge of the Long Term Debt Surcharge Revenues of the Issuer is a Third Lien on those Revenues No revenues of the Issuer, other than the Long Term Debt Surcharge Revenues, are pledged to the repayment of the Bonds The Issuer and MWM have entered into the Agreement pursuant to which the Issuer has agreed to acquire the MWM Water System and related water assets from MWM, to finance the costs of acquiring, construction and equipping extensions, betterments and improvements to the Issuer’s water system and the MWM Water System (the “Improvements”) to enhance the delivery of water and water related services to the customers of the MWM Water System, and to assume ownership, control and operational responsibilities for the MWM Water System The Issuer has covenanted in the Indenture to establish and maintain rates for the Bonds which shall yield Long Term Debt Surcharge Revenues in each forthcoming fiscal year at least equal to the sum of (i) 120% of the aggregate debt service due on the Bonds, and any other Parity Debt during the forthcoming fiscal year, and (ii) 100% of the amounts, if any, required to be deposited in any debt service reserve fund or account securing the Bonds, or any additional Parity Debt during the forthcoming fiscal year See the caption “SECURITY FOR THE BONDS” in the Preliminary Official Statement Purpose Proceeds of the Bonds will be used to (i) finance the costs of acquiring the MWM Water System and related water assets, (ii) finance the costs of acquiring, constructing and equipping the Improvements, (iii) establish a debt service reserve, and (iv) pay the costs of issuance of the Bonds THE SALE Bid Specifications No bid for other than all of the Bonds will be considered All bids must be unconditional Each proposal for the Bonds must specify the amount bid for such Bonds of not less than 99% of the par value of the aggregate principal amount of the Bonds Bidders are invited to name the rate or rates of interest that the Bonds are to bear, in multiples of 1/8 or 1/20 of one percent Any number of rates may be named, provided that (a) the difference between the highest interest rate and the lowest interest rate shall not exceed 300 basis points and (b) no interest rate may exceed 5.0% Each bidder must specify in its bid a single rate for each maturity of the Bonds Bonds Offered for Sale by Competitive Bidding Electronic bids (as explained below), in connection with the sale by the Issuer of $22,915,000* aggregate principal amount of the Bonds, will be received until 10:00 a.m., Central Standard Time, on February 10, 2016, or at such later time and date announced at least 48 hours in advance via BiDCOMP/Parity All bids shall be submitted on the Official Bid Form which may be obtained from the Financial Advisor or Bond Counsel or electronically via BiDCOMP/Parity No additions or alterations in the Official Bid Form shall be made except as provided therein The Official Bid Form contains a section entitled Computation which is informative only and not a part of the bid For purposes of the bidding process, the time as maintained by BiDCOMP/Parity shall constitute the official time ELECTRONIC BIDDING AND BIDDING PROCEDURES Registration to Bid All prospective electronic bidders must be contracted customers of BiDCOMP/Parity If you not have a contract with BiDCOMP/Parity, call (212) 404-8102 to become a customer By submitting a bid for the Bonds a prospective bidder represents and warrants to the Issuer that such bidder’s bid for the purchase of the Bonds (if a bid is submitted in connection with the sale) is submitted for and on behalf of such prospective bidder by an officer or agent who is duly authorized to bind the prospective bidder to a legal, valid, and enforceable contract for the purchase of the Bonds If any provisions of this Official Notice of Sale shall conflict with earlier information provided by BiDCOMP/Parity as approved provider of electronic bidding services, this Official Notice of * Amount preliminary; subject to adjustment as described herein under “Adjustment to Principal Amount.” Sale shall control Further information about BiDCOMP/Parity, including any fee charged, may be obtained from BiDCOMP/Parity at (212) 404-8102 Disclaimer Each prospective bidder shall be solely responsible to register to bid via BiDCOMP/Parity Each prospective bidder shall be solely responsible to make necessary arrangements to access BiDCOMP/Parity for purposes of submitting its bid in a timely manner and in compliance with the requirements of this Official Notice of Sale Neither the Issuer nor BiDCOMP/Parity shall have any duty or obligation to undertake such registration to bid for any prospective bidder or to provide or assure such access to any prospective bidder, and neither the Issuer nor BiDCOMP/Parity shall be responsible for a bidder’s failure to register to bid or for proper operation of, or have any liability for any delays or interruptions of, or any damages caused by BiDCOMP/Parity The Issuer is using BiDCOMP/Parity as a communication mechanism, and not as the Issuer’s agent, to conduct the electronic bidding for the Bonds The Issuer is not bound by any advice and determination of BiDCOMP/Parity to the effect that any particular bid complies with the terms of this Official Notice of Sale and in particular the “Bid Specifications” set forth above All costs and expenses incurred by prospective bidders in connection with their registration and submission of bids via BiDCOMP/Parity are the sole responsibility of the bidders; and the Issuer is not responsible, directly or indirectly, for any such costs or expenses If a prospective bidder encounters any difficulty in registering to bid or submitting, modifying, or withdrawing a bid for the Bonds, it should telephone BiDCOMP/Parity and notify the Issuer’s financial advisor, Stephens Inc., by facsimile at (501) 377-3465 or electronic email Bidding Procedures Bids submitted electronically for the purchase of the Bonds (all or none) must be by means of the Official Bid Form attached to this Official Notice of Sale via BiDCOMP/Parity by 10:00 a.m., Central Standard Time, on February 10, 2016, unless changed as described herein (see “Change of Date and Time for Receipt of Bids”) Prior to that time, a prospective bidder may input and save proposed terms of its bid in BiDCOMP/Parity Once the final bid has been saved in BiDCOMP/Parity, the bidder may select the final bid button in BiDCOMP/Parity to submit the bid to BiDCOMP/Parity Once the bids are communicated electronically via BiDCOMP/Parity to the Issuer, each bid will constitute an irrevocable offer to purchase the Bonds on the terms therein provided No bids will be accepted in written form, by facsimile transmission, or in any other medium or on any system other than by means of the Official Bid Form via BiDCOMP/Parity No bid will be received after the time for receiving such bids specified above Good Faith Deposit A Good Faith Deposit (the “Deposit”) in the amount of FOUR HUNDRED FIFTY-EIGHT THOUSAND THREE HUNDRED DOLLARS ($458,300) is required only from the Purchaser and must be received not later than 3:00 p.m., Central Standard Time, on February 10, 2016 If the Deposit is not received in the time allotted, the Issuer may choose to reject such bid Contact the Financial Advisor at (501) 377-6315 for wiring instructions or with any questions regarding the Deposit The Deposit will be applied to the purchase price of the Bonds In the event the Purchaser fails to honor its accepted bid, the Deposit will be retained by the Issuer as liquidated damages In the event of the failure of the Issuer to deliver the Bonds to the Purchaser in accordance with the terms of this Official Notice of Sale within 45 days after the date of the sale, the Deposit will be promptly returned to the Purchaser, unless otherwise directed by the Purchaser Award of the Bonds The Issuer will award the Bonds or reject all bids after opening of bids and upon verification of the mathematical accuracy of all bids by the Financial Advisor The Issuer reserves the right to waive any irregularities or informalities in any bid, to reject any and all bids, to take any action adjourning or postponing the sale of the Bonds, or to take any other action the Issuer may deem to be in its best interest ADJUSTMENT TO PRINCIPAL AMOUNT Subsequent to the date and time for receipt of bids, the principal amount of Bonds per maturity may be reduced or increased, if necessary, in order to maintain the semi-annual debt service requirements at appropriate levels To the extent that the bid of the successful bidder provides proceeds that are more than sufficient to accomplish the cost of the Projects currently identified by the Issuer and to pay issuance costs, the principal amount of the Bonds may be reduced or increased by the Financial Advisor by adjusting the principal amount of any or all maturities In the event of a reduction or increase of a principal maturity, the Bonds of that maturity shall bear interest at the rates specified in the successful bid and any Term Bonds shall be subject to mandatory sinking fund redemption on the dates specified in the bid The Issuer and the Financial Advisor will prepare and submit to the successful bidder, not later than p.m., Central Standard Time on February 10, 2016, an adjusted schedule of principal amounts The adjusted schedule shall be subject to the approval of the successful bidder which approval shall not be unreasonably withheld In the event of a reduction in total principal, the underwriter’s discount percentage based upon the original bid will be maintained BASIS OF AWARD ALL BIDS SHALL REMAIN FIRM UNTIL 1:00 P.M CENTRAL STANDARD TIME ON THE DATE OF THE SALE An award of the Bonds, if made, will be made by the Issuer within such three hour period of time Unless all bids are rejected, the Bonds will be awarded to the bidder whose bid results in the lowest true interest cost (“TIC”) to the Issuer The TIC shall mean the rate which, as of March 1, 2016, discounts semi-annually, all future payments on account of principal, mandatory sinking fund redemption and interest to the net purchase price bid, including underwriters’ discount, any original issue premium and any original issue discount but not including interest accrued to date of delivery, which accrued interest shall be paid by successful bidder In case of a tie, the Issuer, at its sole discretion, may select the successful bidder THE ISSUER RESERVES THE RIGHT TO WAIVE IRREGULARITIES IN ANY BID AND TO REJECT ANY OR ALL BIDS Undertakings of the Successful Bidder The successful bidder shall make a bona fide offering of each maturity of the Bonds to the Public (as defined below) and shall, within 30 minutes after being notified of the award of the Bonds, advise the Issuer in writing (via facsimile or electronic mail transmission) of the initial public offering price of each maturity of the Bonds (the “Initial Reoffering Prices”) The successful bidder must, by facsimile or electronic mail transmission or delivery received by the Issuer within 24 hours after notification of the Final Aggregate Principal Amount, furnish the following information to the Issuer to complete the Official Statement in final form, as described below: A Selling compensation (aggregate total anticipated compensation to the underwriter expressed in dollars, based on the expectation that all the Bonds are sold at the prices or yields at which the successful bidder advised the Issuer that the Bonds were initially offered to the public) B The identity of the other underwriters if the successful bidder is part of a group or syndicate C Any other material information that the Issuer determines is necessary to complete the Official Statement in final form After the award of the Bonds, the Issuer will prepare copies of the final Official Statement and will include therein such additional information concerning the reoffering of the Bonds as the successful bidder may reasonably request; provided, however, that the Issuer will not include in the final Official Statement a “NRO” (“not reoffered”) designation with respect to any maturity of the Bonds The successful bidder will be responsible to the Issuer in all aspects for the accuracy and completeness of information provided by such successful bidder with respect to such reoffering The Issuer expects the successful bidder to deliver copies of such Official Statement in final form (the “Final Official Statement”) to persons to whom such bidder initially sells the Bonds and the Municipal Securities Rulemaking Board (“MSRB”) via the MSRB’s Electronic Municipal Market Access System (“EMMA”) The successful bidder will be required to acknowledge receipt of the Final Official Statement, to certify that it has made delivery of the Final Official Statement to such repositories, to acknowledge that the Issuer expects the successful bidder to deliver copies of the Final Official Statement to persons to whom such bidder initially sells the Bonds, and to certify that the Bonds will only be offered pursuant to the final Official Statement and only in states where the offer is legal Issue Price Certificate Simultaneously with the delivery of the Bonds, the successful bidder shall furnish to the Issuer a certificate prepared by Bond Counsel (an “Issue Price Certificate”) to the effect (i) that the successful bidder has made a bona fide offering of each maturity of the Bonds to the Public at its respective Initial Reoffering Price, (ii) that, as of the date of the sale of the Bonds, the successful bidder reasonably expected to sell at least 10% of the par amount of each maturity of the Bonds to the Public at its respective Initial Reoffering Price, (iii) that, except for any specified maturities (each a “Specified Maturity”), at least 10% of the par amount of each maturity of the Bonds was actually sold to the Public at or below its respective Initial Reoffering Price, (iv) that, for the Bonds of each Specified Maturity, certain described changes in market conditions during the initial offering period prevented at least 10% of such Bonds from being sold to the Public at or below such Initial Offering Price, and (v) that the respective Initial Reoffering Price for each maturity of the Bonds was not less than the fair market value of such maturity as of the date of the sale of the Bonds The Issue Price Certificate shall state that it is made on the best knowledge, information, and belief of the successful bidder after appropriate investigation The term “Public” means the general public of investors who are purchasing for their own account as ultimate purchasers and does not include Intermediaries “Intermediaries” include bond houses, brokers, and similar persons acting in the capacity of underwriters or wholesalers, and other intermediate purchasers with intent to sell in the short term CHANGE OF DATE AND TIME FOR RECEIPTS OF BIDS The Issuer expects to take bids on the Bonds on February 10, 2016 However, the Issuer reserves the right to change the date and time established for the receipt of bids, and will undertake to notify potential bidders of such changes in the date or time for the receipt of bids Prospective bidders may request notification by facsimile transmission or electronic email of any such change by so advising, and furnishing their telecopier numbers to, Stephens Inc at (501) 3773465 or to jtruemper@stephens.com by noon Central Standard Time, two days prior to the date fixed for the receipt of bids A change of the bid date will be announced via TM3 not later than 8:00 a.m Central Standard Time, on any announced date for receipt of bids, and an alternative sale date and time will be announced via TM3 at least 20 hours prior to such alternative date and time for receipt of bids On any such alternative sale date and time, the Issuer will accept bids for the purchase of the Bonds, such bids to conform in all respects to the provisions of this Official Notice of Sale, except for the changes in the date and time of sale and any other changes announced by TM3 at the time the sale date and time are announced In addition, the Issuer reserves the right to make changes to this Official Notice of Sale Such changes will be announced on TM3 DELIVERY OF BONDS Delivery of Bonds The Bonds are expected to be delivered on or about March 1, 2016 (UNLESS A NOTICE OF A CHANGE IN THE DELIVERY DATE IS ANNOUNCED ON TM3 NOT LATER THAN 3:00 P.M CENTRAL STANDARD TIME ON THE LAST BUSINESS DAY PRIOR TO ANY ANNOUNCED DATE FOR RECEIPT OF BIDS) through the facilities of The Depository Trust Company (“DTC”), New York, New York, against payment of the purchase price therefor (less the amount of the Deposit) in Federal Reserve Funds The usual closing documents, including a certificate that no litigation is pending affecting the issuance of the Bonds, will be delivered at the time of delivery of the Bonds If the Bonds are not tendered for delivery by 12:00 noon, Central Standard Time, on March 1, 2016, or the first business day thereafter, the Purchaser may, on that day or any time thereafter until delivery of the Bonds, withdraw its proposal by serving notice of cancellation, in writing, to the Chief Financial Officer of the Issuer, in which event the Issuer shall promptly return the Deposit Payment for the Bonds, except for the Deposit if credited thereon, shall be made in Federal Reserve Funds CUSIP Numbers It is anticipated that CUSIP identification numbers will be printed on the Bonds; however, neither the failure to print such numbers on any Bond nor any error with respect thereto shall constitute a cause for a failure or refusal by the Purchaser to accept delivery of or pay for the Bonds The CUSIP Service Bureau charge for the assignment of CUSIP numbers and all expenses pertaining to the printing of CUSIP numbers on the Bonds shall be paid for by the Issuer Book Entry Only The Bonds, when issued, will be registered in the name of Cede & Co., as nominee for DTC When the Bonds are issued, ownership interests will be available to purchasers only through a book-entry system maintained by DTC It will be the responsibility of the Purchaser to obtain DTC eligibility at its own cost Failure of the Purchaser to obtain DTC eligibility shall not constitute cause for a failure or refusal by the Purchaser to accept delivery of and pay for the Bonds See the Preliminary Official Statement, “APPENDIX E—BOOK-ENTRY ONLY SYSTEM.” Legal Opinion Bids and delivery of the Bonds shall be conditioned upon the unqualified approving opinion of Wright, Lindsey & Jennings LLP, Little Rock, Arkansas, Bond Counsel, which opinion will be provided at the expense of the Issuer and delivered contemporaneously with the delivery of the Bonds Tax Exemption In the opinion of Bond Counsel, under existing law, interest on the Bonds will be excludable from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; it should be noted, however, that, for the purpose of computing the alternative minimum tax imposed on certain corporations (as defined for federal income tax purposes), such interest is taken into account in determining adjusted current earnings In Bond Counsel’s further opinion, the interest on the Bonds is exempt from State of Arkansas income taxes, and the Bonds are not subject to property taxation in the State of Arkansas See the Preliminary Official Statement, “TAX EXEMPTION.” Trustee Regions Bank has been selected to authenticate the Bonds and serve as Trustee for the Bonds The Issuer will pay the fees of the Trustee Preliminary Official Statement The Issuer has prepared a Preliminary Official Statement dated February 2, 2016, copies of which may be obtained from the Financial Advisor or Bond Counsel at the addresses on the last page of this Notice The Preliminary Official Statement has been deemed final by the Issuer except for the addition of information which will become available following the sale of the Bonds Upon the sale of the Bonds, the Issuer will adopt the final Official Statement to be dated March 1, 2016 Final Official Statement Upon the sale of the Bonds, the Preliminary Official Statement will be amended to conform to the terms of the Purchaser’s bid and, if necessary, to make other changes in the information contained therein The Official Statement will be dated as of the date of the sale and, except as provided in the next succeeding sentence, will be kept current by amendment only through the date of delivery of the Bonds For the period beginning on the date of delivery and ending on the 91st day thereafter, if any event shall occur of which the Issuer has knowledge and as a result of which it is necessary to amend or supplement the Official Statement in order to make the statements therein, in light of the circumstances when the Official Statement is delivered to a prospective purchaser, not misleading, the Issuer will promptly notify the Purchaser of the occurrence of such event and will cooperate in the preparation of a revised Official Statement or amendments or supplements thereto, so that the statements in the Official Statement, as revised, amended, or supplemented, will not, in light of the circumstances when such Official Statement is delivered to a prospective purchaser, be misleading The Issuer will furnish the Purchaser with up to 25 copies thereof without cost on or before February 19, 2016 Additional copies may be ordered by the Purchaser at its expense An electronic copy of the final Official Statement will also be delivered to the Purchaser Continuing Disclosure The Issuer, as Dissemination Agent, and the Trustee will enter into a Continuing Disclosure Agreement which is being executed and delivered for the benefit of the Owners of the Bonds and to assist the Purchaser in complying with Section (b)(5)(i) of Securities and Exchange Commission Rule 15c2-12 under the Securities Exchange Act of 1934 See the Preliminary Official Statement, “APPENDIX B—FORM OF CONTINUING DISCLOSURE AGREEMENT.” During the past five years, there was one year in which the Issuer’s annual report was not filed in a timely fashion For fiscal year 2010, as reported by the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access (“EMMA”), the Comprehensive Annual Financial Report (“CAFR”) was filed timely on June 28, 2011, and the annual report was filed on July 14, 2011 (15 days late); the Issuer’s records document that the annual report was provided timely to the former dissemination agent on June 13, 2011 In order to eliminate filing delays by the dissemination agent, the Issuer has been acting in the capacity of dissemination agent since 2012 The Issuer has adopted written procedures for preparation and filing of CAFRs, annual reports, and event notifications Other than as set forth in detail in the preceding paragraph, the Issuer has complied, in all material respects, with all previous undertakings in the past five years with respect to the outstanding bonds of the Issuer On May 1, 2010, Moody’s Investors Service, Inc (“Moody’s”) changed the rating on the Issuer’s outstanding Water Revenue Bonds, Series 2007, dated July 15, 2007 (the “Senior Debt”) from “Aa3” to “Aa2” due to Moody’s move to the Global Rating Scale The Issuer filed a Notice of Material Event for the rating change on July 16, 2014 Registration The Bonds have not been registered under the Securities Act of 1933, as amended, nor has the Indenture been qualified under the Trust Indenture Act of 1939, as amended, in reliance upon certain exemptions from such registration and qualification contained in such laws The Issuer assumes no responsibility for registration or qualification of the Bonds under securities laws of any jurisdiction in which the Bonds may be sold, assigned, pledged, hypothecated, or otherwise transferred By submission of its bid, the Purchaser represents that the sale of the Bonds will be made pursuant to exceptions from registration or qualification, or where necessary, the Purchaser will register the Bonds at the Purchaser’s expense in accordance with the securities laws of the state in which the Bonds are offered or sold Costs and Expenses The Issuer will pay from proceeds of the Bonds or other revenues of the Water System the following costs and expenses in connection with the sale and delivery of the Bonds: fees and expenses of the Financial Advisor, Bond Counsel, Accountants, the Trustee, CUSIP, and Moody’s Investors Service, Inc and up to 25 printed copies of the Official Statement The Purchaser shall pay all fees or charges with respect to DTC or any registration or qualification 10 15 CAW's Right to Terminate Water Service It is understood and agreed that this Agreement shall in no way restrict or limit CAW's right to terminate water service to any Customer for nonpayment of billed charges or other permissible reason The parties expressly agree that CAW shall have no liability whatsoever for any reduction in Customer Bills or UTILITY revenue due to a termination of water service Indemnity UTILITY hereby agrees to save, protect, defend, indemnify, and 16 hold CAW and its commissioners, executives, employees, agents, successors and assigns (each an "Indemnitee" and, collectively, the "Indemnitees") harmless from and against any and all claims, causes of action, judgments, liabilities, liens, losses, demands asserted by third parties and any and all costs, expenses, attorney's fees and any fees or charges arising out of (i) Billing Services performed by CAW under the agreement, (ii) the negligence or intentional misconduct of UTILITY, its employees, or its permitted subcontractors, (iii) UTILITY's misrepresentation of any facts to CAW, (iv) UTILITY's warranties, covenants, and agreements set forth in section 17 of this Agreement, and (v) any costs arising out of CAW's performance of Billing Services as a result of a Customer challenging CAW's authority to collect the billed charges or the legitimacy of the billed charges or any fees associated with the billed charges UTILITY is not responsible for costs related to CAW's misapplication of customer payments or any gross negligence by CAW Warranties UTILITY represents and warrants that UTILITY has taken all 17 appropriate steps and received all required approvals from the UTILITY's governing body giving the UTILITY the authority to enter into this agreement allowing CAW to perform the Billing Services 18 Waiver The waiver by either party of a breach by the other of any provision of this Agreement shall not constitute a continuing waiver or a waiver of any subsequent breach of either the same or a different provision of this Agreement 19 Severability Should any part of this Agreement be declared by a final decision by a court or tribunal of competent jurisdiction to be unconstitutional, invalid, or beyond the authority of either party to enter into or carry out, such decision shall not affect the validity of the remainder of this Agreement, which shall continue in full force and effect, provided that the remainder of the Agreement, absent the excised portion, can be reasonably interpreted to give effect to the intentions of the parties 20 Amendment This Agreement is not subject to modification or amendment except as provided on paragraph 15 hereof or by a writing executed by both CAW and UTILITY, which writing shall expressly state that it is intended by the parties to amend the terms and conditions of this Agreement 21 Entire Agreement Expect as expressly provided herein, this Agreement constitutes the entire understanding and agreement of the parties This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto and supersedes all negotiations or previous agreements between the parties with respect to all or any part of the subject matter hereof 22 Binding Effect This Agreement shall be binding on the parties hereto and their successors and assigns Exhibits IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized representatives as of the day and year first written above UTILITY By: Central Arkansas Water By: _ Jeff Mascagni, CFO Exhibits Exhibit 5G-2 Billing Services Agreement City BILLING SERVICES AGREEMENT This Billing Services Agreement ("Agreement") is made and entered into as of the day of , 2016, by and between Central Arkansas Water ("CAW") and the City of Maumelle, Arkansas ("Maumelle") WITNESSETH WHEREAS, CAW performs meter reading, billing and collection services (collectively, and as more accurately described below, "Billing Services") under the name of Utility Billing Services; WHEREAS, Maumelle desires to engage CAW to perform certain Billing Services on the behalf of Maumelle pursuant to the terms and provisions hereof; NOW THEREFORE, for and in consideration of the promises and covenants contained herein, and other good and valuable consideration, the parties hereto hereby agree as follows : Agreement: Definitions The following are definitions of certain terms used in this a "CAW" means Central Arkansas Water, a public body corporate and politic organized and existing under the laws of the State of Arkansas, including, particularly, the Consolidated Waterworks Authorization Act of 2001, Act 982 of the 83rd General Assembly of the State of Arkansas, codified at Arkansas Code Annotated §§25-20-301 et seq (2002 Repl ) "Customer" or "Customers" means all households receiving sanitary b and recycling collection and disposal services from Maumelle and/or responsible for paying the "Community Service Fee" to Maumelle c "Customer Bills" means the monthly statements prepared and delivered by CAW to Customers for monthly service charges for services provided by Maumelle d "Rates" means the amount to be charged each Customer as determined in accordance with paragraph hereof Rates shall consist of two parts: the Community Service Fee and the Sanitation Service Fee e "Maumelle" means the City of Maumelle Remittances for Maumelle shall be sent to: City of Maumelle, Finance Department, 550 Edgewood, Suite 590, Maumelle, AR 72113 f "Maumelle Proceeds" means monies received from Customers and allocated to pay Maumelle Receivables in accordance with the terms of this Agreement Exhibits h "Write-Off Accounts" means Maumelle Receivables adjusted on the books of CAW, in accordance with CAW's standard accounting practice of classifying accounts as uncollectable 90 days after account becomes inactive g "Maumelle Receivables" means the dollar amount of Customer Bills submitted by CAW to Customers for payment on each Customer Bill for the benefit of Maumelle Billing Services Agreement During the term of this Agreement, CAW shall provide Billing Services for Maumelle Supervision and Control CAW shall have sole and exclusive supervision and control over its operations under this Agreement, including but not limited to the method of preparing the Customer Bills and making the collections thereunder; the selection, design and use of forms and changes thereto; the selection and use of data processing equipment, office machinery, and other equipment for reading of meters and preparation of Customer Bills; and the hiring and management of employees for the performance of this Agreement CAW's decisions with respect to any and all aspects of its Billing Services shall be final and conclusive UTILITY agrees that CAW may make changes in its Billing Services procedures during the term of this Agreement, and in the equipment required therefore Description of Billing Services Pursuant to and in accordance with the terms of this Agreement, CAW shall furnish the labor, services, materials and equipment required to perform the "Billing Services," which shall include the following: a Determine the appropriate Maumelle bill in accordance with the Rates for each Customer; b Submit Customer Bills to the Customers on CAW's normal billing cycle (in most instances, the Customer Bills will be included on CAW's bill for water services); c Maintain Customers' records; d Collect, as agent for Maumelle, all funds on behalf of the Maumelle for which CAW has performed billing; and remit to Maumelle amounts collected on a monthly basis by the 15th of the following month CAW may at its discretion remit based on the prior month's billings with adjustments as described herein Accounting for and Distribution of Maumelle Proceeds Customers may pay Customer Bills by mail to CAW or in person at CAW designated locations Other bill payment options may be offered from time to time Unless otherwise indicated herein, CAW shall allocate payments received on particular accounts first the collection of solid waste, then to sewer service charges, then to any other charges imposed by Maumelle Thereafter, prior to the transmission of any Maumelle Receivables to Maumelle, CAW shall be entitled to deduct the fees due to it for the services rendered hereunder and the Write-Off Accounts previously paid to Maumelle After making such deductions, the remaining Maumelle Receivables shall be delivered to Maumelle All other amounts paid by any Customer shall be credited to amounts due to CAW Collection of Past Due Rates Further to CAW's role as collection agent for Maumelle, if a suit is initiated by CAW to collect past due Rates on behalf of Maumelle, then CAW shall keep any penalties or fees awarded by the court in excess of the past due Rates payable to Maumelle Notwithstanding the flow of proceeds set forth in paragraph Exhibits above, any legal fees incurred by CAW in collecting past due Rates shall be allocated pro rata among all parties and shall be the responsibility of all parties whether or not such party has received payment for their Rates prior to the collection suit CAW Service Charges CAW will be entitled to receive One Thousand Dollars ($1,000) on the signing of this agreement to cover programming costs (the "Programming Fee") CAW may retain the Programming Fee out of the initial Maumelle Proceeds collected by CAW CAW shall receive $0.528 per bill for the Sanitation Service Fee and $0.592 per bill for the Community Service Fee sent to Customers by CAW on behalf of Maumelle (the "Base Rate") Beginning on April 1, 2016, the service charge shall be annually adjusted on April each year by the previous year's change in the Consumer Price Index - All Urban Consumers (case year 1982-84 = 100) as published by the Bureau of Labor Statistics, United States Department of Labor Major upgrades, expenditures or changes to CAW's billing system may require renegotiation of the Base Rate Credit Cards It is contemplated that consumer demands will necessitate the acceptance of credit cards for payment at some future date This cost element is not factored into the Base Rate, as made final in accordance with paragraph hereof, therefore Maumelle agrees to pay its pro rata share of any fees assessed by the credit card companies or credit card processing company for customer credit card usage in addition to the Base Rate, as made final in accordance with paragraph hereof Rates Customers will be billed the Sanitation Service Fee and/or the Community Service Fee in accordance with the rate resolution or ordinance duly adopted by Maumelle's governing body in accordance with Arkansas law Nothing, however, contained in such resolution or ordinance shall modify or otherwise change the terms of or CAW's obligations under this Agreement except for the amount of the fees to be billed and collected Reports As part of the Billing Service and upon request, CAW will generate 10 such reports as reasonably requested by the Maumelle and which are reasonably capable of being generated by CAW 11 Communications from Maumelle All requests by Maumelle to add, delete, modify or in any way change its Rates or to obtain information concerning individual accounts or groups of accounts or any other data shall be made in writing to Chief Financial Officer, Central Arkansas Water, P.O Box 1789, Little Rock, AR Rate changes require sixty (60) days advance notice in writing and calculation methodology changes require six (6) months advance notice in writing Charges incurred by CAW for changes from the software vendor will be passed onto Maumelle at cost 12 Call Center CAW will maintain a call center to accommodate customers regarding account balance and status questions Debt Service specific questions will be referred to a telephone number provided by Maumelle 13 Cooperation Parties agree to cooperate and share information in good faith to make appropriate adjustments and to provide information to ensure correctness in billing, collection and report generation 14 Term The initial term of this Agreement shall begin on January 1, 2016, for a ten (10) year period ending December 31, 2025 ("Initial Term") and shall automatically renew for additional five (5) years periods ("Renewal Term") thereafter unless either party gives written notice to the other party of its intent not to renew at least two (2) months prior to expiration of the Initial Term or any Renewal Term Termination of this Agreement shall not affect Maumelle's liability, as provided herein, to pay the cost of Billing Services Exhibits which have been rendered by CAW pursuant to this Agreement prior to the date of termination 15 CAW's Right to Terminate Water Service It is understood and agreed that this Agreement shall in no way restrict or limit CAW's right to terminate water service to any Customer for nonpayment of billed charges or other permissible reason The parties expressly agree that CAW shall have no liability whatsoever for any reduction in Customer Bills or Maumelle revenue due to a termination of water service 16 Indemnity Maumelle hereby agrees to save, protect, defend, indemnify, and hold CAW and its commissioners, executives, employees, agents, successors and assigns (each an "Indemnitee" and, collectively, the "Indemnitees") harmless from and against any and all claims, causes of action, judgments, liabilities, liens, losses, demands asserted by thil'd parties and any and all costs expenses, attorney's fees and any fees or charges ari ing out of (i) Billing Services performed by CAW under the agreement, (ill the negligence or intentional misconduct of Maumelle, its employees, 01' its permitted subcontractors (iii) Maumelle's misrepresentation of any facts to CAW, (iv) Maumelle's warranties, covenants, and agreements set forth in section 17 of this Agreement, and (v) any costs arising out of CAW's performance of Billing Services as a result of a Customer challenging CAW's authority to collect the billed charges or the legitimacy of the billed charges or any fees associated with the billed charges Maumelle is not responsible for costs related to CAW's misapplication of customer payments or any gross negligence by CAW 17 Warranties Maumelle represents and warrants that Maumelle has taken all appropriate steps and received all required approvals from the Maumelle's governing body giving the Maumelle the authority to enter into this agreement allowing CAW to perform the Billing Services 18 Waiver The waiver by either party of a breach by the other of any provision of this Agreement shall not constitute a continuing waiver or a waiver of any subsequent breach of either the same or a different provision of this Agreement 19 Severability Should any part of this Agreement be declared by a final decision by a court or tribunal of competent jurisdiction to be unconstitutional, invalid, or beyond the authority of either party to enter into or carry out, such decision shall not affect the validity of the remainder of this Agreement, which shall continue in full force and effect, provided that the remainder of the Agreement, absent the excised portion, can be reasonably interpreted to give effect to the intentions of the parties 20 Amendment This Agreement is not subject to modification or amendment except as provided on paragraph 15 hereof or by a writing executed by both CAW and Maumelle, which writing shall expressly state that it is intended by the parties to amend the terms and conditions of this Agreement 21 Entire Agreement Expect as expressly provided herein, this Agreement constitutes the entire understanding and agreement of the parties This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto and supersedes all negotiations or previous agreements between the parties with respect to all or any part of the subject matter hereof 22 Binding Effect This Agreement shall be binding on the parties hereto and their successors and assigns Exhibits IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized representatives as of the day and year first written above City of Maumelle, Arkansas By: ｾ ｾ ｾ ｾ ｾ ｾ Michael Watson, Mayor Central Arkansas Water By:_ _ _ _ _ Jeff Mascagni, CFO Exhibits Exhibit 5J-1 Special Operational Terms and Conditions A CAW shall be permitted to dispose of water treatment residuals from the MWM water treatment plant without charge from the Wastewater Provider B If the Wastewater Provider is not NLRWW, then CAW, working in cooperation with the Wastewater Provider, shall assume responsibility for closing of the wastewater lagoon where water treatment residuals have been disposed of for a number of years after the MWM water treatment plant has been idled and the water treatment residual lagoon at the water treatment plant has been emptied CAW and the Wastewater Provider shall work to obtain permission to either dry and cap the lagoon and residuals in place or land apply the residuals C IfNLRWW is selected as the Wastewater Provider, CAW shall assume responsibility for removing the residuals from the wastewater lagoon where water treatment residuals have been disposed of for a number of years after the MWM water treatment plant has been idled and the water treatment residual lagoon at the water treatment plant has been emptied Exhibits [THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX H MAP OF MAUMELLE WATER MANAGEMENT WATER SERVICE AREA [THIS PAGE INTENTIONALLY LEFT BLANK] H-1 [THIS PAGE INTENTIONALLY LEFT BLANK] Central arkansas Water • aCquisition and ConstruCtion Water revenue Bonds (MauMelle Water systeM aCquisition ProjeCt), series 2016