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HomeMy WebLinkAboutOrdinance - 4204-1963 - Authorizing the Issuance of $1,666,000.. -r Amended by Ordinance No. 4205, October 10, 1963 • MINUTES PERTAINING TO PASSAGE OF ORDINANCE AUTHORIZING THE ISSUANCE OF $1,666,000 "CITY OF LUBBOCK, TEXAS, ELECTRIC LIGHT AND POWER SYSTEM REVENUE REFUNDING OONDS, SERIES 196311 THE STATE OF TEXAS CITY OF LUBBOCK COUNTY OF LUBBOCK I ON THIS, the 3rd day of October, 1963, the City Commission of the City of Lubbock, Texas, convened in special session at the regular meeting place thereof in the City Hall, there being present and in attendance the following members, to-wit: JACK F. STRONG W. E. ALDERSON ROLAN SIMPSON W. c. O'MARA MARVIN McLARTY,JR. MRS. IAVENIA LOWE MAYOR l COMMISSIONERS and City Secretary also being present; and with the following absent: ---------------~ ------~•=o~n=e ____________ , constituting a quorum; at which time the following, among other business, was transacted, to-wit: O'Mara introduced the following ----~~~--------------------~ ordinance: ORDINANCE NO, 4204 11AN ORDINANCE authorizing the issuance of 'City of Lubbock, Texas, Electric Light and Power System Revenue Refunding Bonds, Series 1963' in the principal amount of ONE MILLION SIX HUNDRED SIXTY SIX THOUSAND DOLLARS ($1,666,000) for the purp ose of discharging, refunding, redeeming, cancelling and in lieu of a like amount of valid and special obligation indebtedness of the City's Electric Light and Power System evidenced by three series of revenue bonds known as 'City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 1949' dated May 1, 1949, 'City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 1951', dated January 1, 1951 and 'City of Lubbock, Texas, Electric Light System Revenue Refunding Bondar, dated September 1, 1958, said three aeries of bonds aggregating the sum of ONE MILLION SIX HUNDRED SIXTY SIX THOUSAND DOLLARS ( $1,666,000), .., ..... . \... constituting all the outstanding bond indebtedness of the Cityrs Electric Light and Power System; prescribing the form of the refunding bonds and the interest coupons appurtenant thereto; pledging the net revenues of the City's Electric Light and Power System to the payment of said bonds and the interest thereon; providing for the subsequent issuance of bonds on a parity with those herein authorized; providing certain covenants pertaining to the bonds herein authorized and the funds from which same are to be paid; enacting and ordaining sundry provisions incident and relating to the subject and purpose of this ordinance; and declaring an emergency." The ordinance was read in full and thereupon Commissioner ____ O_'_Ma __ r_a _______ moved that the charter rule prohibiting the passage of ordinances on the day on which introduced, unless declared an emergency measure, be suspended for the reasons set forth and defined in the preamble thereto. The motion was seconded by Commissioner __ ~S~1~ap~•-o~n _________ and carried by the following vote: YEAS: Mayor Strong and Commissioners Alderson, Simpson, O'Mara and McLarty. NAYS: None. Commissioner Alderson then moved that the ordinance be finally passed as an emergency measure to take effect immediately from and after its passage. The motion was seconded by Commissioner O'Mara and carried by the following vote: YEAS: Mayor Strong and Commissioners Alderson, Simpson, O'Mara and McLarty. NAYS: None. The Mayor then announced the final passage and immediate effect Qf the ordinance as an emergency measure. MINUTES APPROVED, th day of October, 1963. xas ATTEST: city ~ry,~o Lubbock, Texas (City seal) ORDINANCE NO. 4204 ---------------- "AN ORDINANCE authorizing the issuance of 1 City of Lubbock, Texas, Electric Light and Power System Revenue Refunding Bonds, Series 1963 1 in the principal amount of ONE MILLION SIX HUNDRED SIXTY liiX TIDUSAND OOLIARS ($1,666,000) for the purpose of discharging, refunding, redeeming , cancelling and in lieu of a like amount of valid and special obligation indebtedness of the City's Electric Light and Power System evidenced by three aeries of revenue bonds known as 'City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 1949 1 dated May 1, 1949, 'City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 1951 1 , dated January 1, 1951 and 1City of Lubbock, Texas, Electric Light System Revenue Refunding Bonds', dated September 1, 1958, said three series of bonds aggregating the sum of ONE MILLION SIX HUNDRED SIXTY SIX THOUSAND DOLLA.RS ( $1,666, 000) constituting all the outstanding bond indebtedness of the City's Electric Light and Power System; prescribing the form of the refunding bonds and the interest coupons appurtenant thereto; pledging the net revenues of the City1 s Electric Light and Power System to the payment of said bonds and the interest thereon; providing for the subsequent issuance of bonds on a parity with those herein authorized; providing certain covenants perta~ning to the bonds herein authorized and the funds from which same are to be paid; enacting and ordaining sundry provisions incident and relating to the subject and purpose of this ordinance; and declaring an emergency. " WHEREAS, the City of Lubbock has now outstanding certain revenue bonds payable from and ratably secured by a first lien on and pledge of the net revenues of the City's Electric Light and Power System, said bonds being further des- cribed as follows: "City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 1949, dated May 1, 1949, Numbersl451 through 2300, due serially on May 1st in each of the years 1964 through 1969, in denomination of $1,000 each, bearing interest at the rates of 2-1/2% per annum, aggregating the principal sum of $850,000, all subject to call for redemption on November 1, 1963; "City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 1951, dated January 1, 1951, Numbers 419 through 774, due serially on January 1st in eaah of the years 1964 through 1971, in denomination of $1,000 each, bearing interest at the rate of 2-1/4% per annum, aggregating the principal sum of $356,000, all subject to call for redemption on January 1, 1964; and "City of Lubbock, Texas, Electric Light System Revenue Rerunding Bonds, dated September 1, 1958 Numbers 491 through 950, due serially on September let in each of the years 1964 through 1968, in denomination of $1,000 each, bearing interest at the rate of 2-1/2% and 2-3/4% per annum, aggregating the principal sum of $46o,ooo, all subject to call for redemption on March 1, 1964; WHEREAS, the above described bonds constitute all the bond indebtedness outstanding against the City's Electric Light and Power System and all are being duly and legally called for redemption on the redemption dates above specified as to each series respectively; and WHEREAS, the City Commission now considers it feasible, desirable, practicable and in the City's beat interest now to provide for the issuance of $1,666,000 Electric Light and Power System Revenue Refunding Bonds, pursuant to the provisions of applicable laws including Articles 1111 to 1118, R.C.S. of Texas, 1925, as amended, for the purpose of discharging, refunding, redeeming, cancelling and in lieu of a like amount of the above described outstanding bond indebtedness; said refunding bonds to mature, to bear interest and to be subject to such conditions, privileges and restrictions as are hereinafter provided; and WHEREAS, the City Commission has found and hereby declares that there is an urgent public necessity that it proceed with the issuance of such revenue refunding bonds for the purpose of providing funds with which to discharge, redeem, refund and cancel the outstanding indebtedness of the City's Electric Light and Power System hereina~oue referred to at the earliest possible date ana that therefore this Ordinance constitutes an emergency measure for the immed:la te preservation of the public peace, property, health, safety, good government, order and security of the City and its inhabitants; therefore BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF LUBBOCK: SECTION 1: Authorization -Princ~Eal Amount - Desi~nation. That in order to borrow the sum of ONE MILLION SIX HUNDRED SIXTY SIX THOUSAND DOLLARS ($1,666,000) for the purpose of discharging, refunding, redeeming, cancelling and in lieu of a like amount of valid and subsisting special obliga- tions of the City of Lubbock, Texas, payable from and ratably secured by a first lien on and pledge of the net revenues of the City's Electric Light and Power System more fully described in the preamble hereof {hereinafter referred to as "underlying bonds") the City Commission of the City of Lubbock, Texas, by virtue of authority conferred by the laws of the State of Texas, including Articles 1111 to 1118, inclusive, has determined that there shall be issued and there is hereby ordered to be issued a series of coupon bonds in the total principal sum of ONE MILLION SIX HUNDRED SIXTY SIX THOUSAND DOLLARS ($1,666,000) to be designated uCITY OF LUBBOCK, TEXAS, ELECTRIC LIGHT AND POWER SYSTEM REVENUE REFUNDING :OONDS., SERIES 1963", dated and maturing as set out below, and which said series of bonds shall be payable as to both principal and interest solely from and secured by a first lien on and pledge of the net revenues of the City's Electric Light and Power System, as hereinafter defined. SECTION 2: Date -Numbers -Maturity. Said bonds shall be dated October 15g 1963; shall be numbered consecutively from One (1) to Three Hundred Thirty Four {334), both inclusive, shall be in denomination of FIVE THOUSAND DOLLARS ($5,000) each, except Bond Number One (1) which shall be in denomination of ONE THOU~ DOLLARS ($1,000); aggregating the principal sum of ONE MILLION SIX HUNDRED SIXTY SIX THOUSAND DOLLARS { $1,666, 000) , and shall become due and payable serially, without right of prior redemption, in accordance with the following schedule: I RUMlBRS DBNOIIIRATI01f IIIATURITY 1 $1,000 l 2 to 35 5,000 April 15, 1964 $171,000 36 to 69 5,000 October 15, 1964 170,000 70 to 103 5,000 April 15, 1965 170,000 104 to 136 5,000 October 15, 1965 165,000 137 to 169 5,000 April 15, 1966 165,000 170 to 202 5,000 October 15, 1966 165,000 203 to 235 5,000 April 15, 1967 165,000 236 to 268 5,000 October 15, 1967 165,000 269 to 301 5,000 April 15, 1968 165,000 302 to 334 5,000 October 15, 1968 165,000 SBC'l'ION 3: Interest. Said :Borns shall bear interest from date thereof to maturitr at the following rates per annua; that 1a to say-- (a) Bonds Numbered 1 through 136 maturing semi- annually April 15, 1964 through October 15, 1965, shall bear interest at the rate or 2-1/~ per annum; (b) Bonds Humbered 137 through 334, JD&turing ae~i-annually on April 15, 1966 through October 15, 1968, shall bear interest at the rate of 2-3/~ per annum; auch interest to be evidenced by proper coupons attached to each of aaid bonds and said interest shall be payable on April 15, 1964, and semi-annually thereafter on October 15 and April 15 in each year. SECTION 4: Places of Pamnt. Both principal of and interest. on this series or refunding bonds ~hall be payable in lawful money of the United States or America, without exchange or collection charges to the owner or holder at the CITIZENS HlTIONAL MNK, Lubbock, Texas, or at the option or the holder at THB J'IRST !IATIONAL CITY BUlK OF HlN YORK, New York C1 ty, New York, upon presentation ani surrender of bonds or proper coupons. SECTION 2: Bonds -Special Obligations. Said bonds shall constitute special obligations of the City of Lubbock and each of said bonds shall contain the following recitation: 11The holder hereof shall never have the right to demand payment of this obligation out of any funds raised or to be raised by taxation." SECTION 6: Execution of Bonds and Interest Coupons. The corporate seal of the City of Lubbock may be impressed on each of said bonds or in the alternative a facsimile of such seal may be printed thereon. The bonds and interest coupons appurtenant thereto may be executed by the imprinted facsimile signatures of the Mayor and City Secretary of the City and exe- cution in such manner shall have the same effect as if such bonds and coupons had been signed by the Mayor and City Secretary in person through their manual signatures. Inasmuch as such bonds are required to be registered by the Comptroller of Public Accounts for the State of Texas, only his signature (or that of a deputy designated in writing to act for the Comptroller) shall be required to be manually subscribed to such bonds in connection with his registration certificate to appear thereon, as hereinafte provided; all in accordance with the provisions of "Texas Uniform Facsimile Signature of Public Officials Act" enacted by the 57th Legislature of Texas at its Regular Session in 1961. SECTION 7: Form of Bonds. The form of said bonds shall be substantially as follows: NO. __ _ UNITED STATES OF AMERICA STATE OF TEXAS COUNTY OF LUBBOCK CITY OF LUBBOCK1 TEXAS, ELECTRIC LIGHT AND POWER SYSTEM REVENUE REFUNDING BOND, SERmS 1963 I THB CITY OF LUBBOCK, County of Lubbock, State or Texas, '. . a municipal corporation duly incorporated under the laws or the State of Texas a~d acting under its Home Rule Charter, POR VALUB RBCBIVBD hereby acknowledges itself' indebted to and promisee to pay to the bearer hereof out of the revenues specified in thia bond, without right or prior redemption, on the FIFTBBNTH DAY OF 196__~ _______ _..THOUSAND DOLIARS ($ _____ ), in lawful money of the United States of America, with interest thereon from date hereof to maturity at the rate or _________ PER CENTUM ( ___ __..) payable on April 15, 1964 and semi-annually thereafter on October 15 and April 15 in each year, the interest falling due on or prior to maturity hereof being payable only upon presentation ana surrender of the interest coupons hereto attached as they severally become due . B:>'rH PRDICIPAL and interest of this bond are payable at the CITIZENS HA.'l'IOHAL BlHK, Lubbock, Texas, or at the option of the holder at M IPIRST HA'l'IOHA.L CITY BANK OP NKW YORK, New York . . . City, lfew York, without exchange or collection charges to the owne or holder and the said City or Lubbock, Texas, is hereby held and firmly bound to apply the pledged, appropriated revenues or ita Electric Light and Power System to the prompt payment o.f interest on this bond as it ralls due and the principal thereof at maturity and to pay the said principal and interest as they mature. THIS BORD is one of a series or like tenor and ettect, except as to number, interest rate and maturity, aggregating ONB MILLION SIX HUNDRED SIXTY SIX 'l'HOUSA.ND DOLlARS ( $1,666,000) 1 . . . l'.lumbered conaecutivel7 from One (1) to Three Hundred Thirty Four (334), both inclua1Ye, Humber One (1) being in denomination of One Thousand Dollars {$1,000) and Numbers TWo (2) to Three Hundred Thirty Pour (334), both inclusive, being in denomination of Five Thousand Dollars ($5,000) each, issued for the purpose of discharging, refunding, redeeming, cancelling and in lieu of a like amount of valid and subsisting special obligations of the City evidenced by three series of revenue bonds aggregating $1,666,000 in principal amount, (being "City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 1949", dated May 1, 1949 in the principal sum of $850,000; "City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 195111 , dated January 1., 1951 in the principal sum of $356,000; and "City of Lubbock,Texas, Electric Light System Revenue Refunding Bonds,11 :ilated September 1, 1958, in the principal sum of $460,000), in accordance with the Constitution and laws of the State of Texas, including the pro- visions of Articles 1111 to 1118, both incluste, Revised Civil Statutes of Texas, 1925, as amended, and pursuant to an ordinance passed by the City Commission of the City of Lubbock, Texas, and duly recorded in the Minutes of said City Commission. THE ~TE of this bond in conformity with the ordinance aforementioned is October 15, 1963. THIS BOND, as well as all bonds of its series constitute special obligations of the City of Lubbock, Texas, payable as principal and interest and equally secured by a first lien on pledge of the revenues of the City's Electric Light and Power 3ystem after deduction of reasonable expenses of operation and maintenance. THE CITY OF LUBBOCK expressly r-eserves the right to issue further and additional revenue bond obligations, in all things on a parity with the bonds of this series and payable from and equally secured by a first lien on and pledge of the to and net revenues of the City's Electric Light and Power System, PROVIDED., HOWEVER., that any and all such further parity bonds may be so issued only in accordance with the covenants, conditions, limitations and restrictions relating thereto which are set out and contained in the ordinance authorizing this series of bonds, and to which said ordinance reference is hereby made for full and complete particulars. The holder hereof shall never have the right to demand payment of this obligation out of any funds raised or to be raised by taxation. EACH successive holder of this bond, and each successive holder of the coupons hereto attached, is conalusively presumed to forego and renounce his equities in favor of subsequent holders for value without notice, and to agree that this bond and each of the coupons hereto attached, may be negotiated by delivery by any person having possession hereof, however such possession may have been acquired, and that any holder who shall have taken this bond or any of the coupons from any person for valGe without no- tice thereby has acquired absolute title thereto, free of all equities and claims of ownership of any such prior holder. The City of Lubbock and its of~ials and the paying agents hereinabove named shall not be affected by any notice to the contrary. AND IT IS HEREBY CERTIFIED AND RECITED that the issuance of this bond, and the series of which it is a part, is duly autho- rized by law; that all acts, conditions and things required to exist and to be done precedent to and in the issuance of this bond to render the same lawful and valid have. been properly done, have happene~ and have been performed in regular and due time, form and manner, as required by the Constitution and laws of the State of Texas, and the ordinance hereinabove mentioned; that this series o revenue bonds does not exceed any constitutional or statutory limitations; and that provision has been made for the payment Gf the principal and interest of this bond, and the series of which it is a part, by irrevocably pledging therefor the net revenues ot the City's Electric Light and Power System. D T.BS'J.'IMOHY WBBRBOF, the City Commission of the Oi ty of Lubbock, Texas~ in accordance with the provisions of the "Texas Unitora Facsimile Signature of Pu~lic Officials Act• enacted by the 57th Legislature ot Texas at its regular session in 1961, bas caused the seal of said City to be impressed or a facsimile thereof to be printed hereon, and this bond and its appurtenant coupons to be executed with the imprinted facsimile signatures of the Mayor and City Secretary of said City as of the 15th day of October, 1963. Jliyor, city or Lubbock, Tixas COUH'!'ERSIGNED: city secretary, city ot Lubbock, Texas SECTION 8: J!2rm of, Coupon,s •. ·The form of said interest -coupons shall be substantially as follows: NO. -OH THE FIF'l'EBN'fH DAY OF 19 -- The City of Lubbock, a municipal corporation of the State of Texas, hereby promises to pay to bearer, the amount shown hereon out of funds specified in the bond to which this coupon is attached, and in lawful money ot the United States of America~ without exchange or collection charges to the owner or hoider, at the CI'l'IZBNS MA.TIONAL BA.NK, Lubbock, 'l'exas, or at the option of . . .. . the holder at i'HE FIRST NATIONAL Cifi BlNK OF lfBV YORK, New York City, New York. such sum being six months' interest due that date on 11CITY OF LUBBOCK1 TEXAS~ ElECTRIC LIGHT AND POWER SYSTEM REVENUE REFUNDING :OOND1 SERIES 1963", dated October 15, 1963. The holder hereof shall never have the right to demand payment of this obligation out of funds raised or to be raised by taxation. Bond No. ___ • Secretary,City of Lubbock,Texas Mayor, City of Lubbock, Texas SECTION 9: Form of Comptroller's Certificate. Sub- ' stantially the following shall be printed on the back of each bond: OFFICE OF COMP!ffiOLLER STATE OF TEXAS I REGISTER NO. __ I HEREBY CERTIFY that there is on file and of record in my office a certificate of the Attorney General of the State of Texas, to the effect that this bond has been examined by him as required by law, and that he finds that it has been issued in conformity with the Constitution and laws of the State of Texas, and that it is a valid and binding special obl~gation upon said City of Lubbock, Texas, payable from the revenues pledged to its payment by and in the ordinance authorizing same, and said bond has this day been registered by me. WITNESS MY HAND AND SEAL OF OFFICE, at Austin, Texas, Comptroller of Public Accounts of the State of Texas SECTION 10: Approval by Attorney General -Registration b~ Comptroller of Public Accounts. After the aforementioned bonds have been executed by the City officials as hereinafter provided, they shall be presented to the Attorney General of the State of Texas for examination and approval. The City of Lubbock having the right under the law, to issue and sell the bonds herein authorized and to deliver them upon cancellation of the underlying bonds, when the bonds herein authorized have been so approved by the Attorney General and the City has made the deposits required and has otherwise complied with the law in such respects, the Comptroller of Public Accounts of the State of Texas, shall regis- ter said bonds despite the fact that some or all of the underlying bonds shall not have been surrendered by the holders thereof for payment and cancellation. SECTION 11: Definitions. For all purposes of this ordinance and for clarity with respect to the issuance of the bonds herein authorized and the pledge and appropriation of revenues therefor, the following definitions are provided. (1) The term 11 System11 shall mean all properties, real, personal, mixed, or otherwise, now owned or hereafter acquired by the City of Lubbock through purchase, construction or otherwise, and used in connection with the City1 s Electric Light and Power System and in anywise appertaining thereto, whether situated within or without the limits of the City. (2) The term "Net Revenues" sqall mean the gross . . revenues of the City's Electric Light and Power System leas the expense of operation and mmntenance. Such expense of operation and maintenance shall not incl~de depreciation charges or funds pledged for the bonds herein authorized and additional parity bonds hereafter authorized, but shall include all salaries, labor, materials, repairs, extensions necessary to render services, provided, however, that in determining ttNet Revenuesn only such repairs and extensions . . as in the judgment of the City Commission, reasonably and fairly exercised are necessary to keep the System in operation and render adequate service to the City and inhabitants thereof, or such as might be necessary to remedy some physical defect which otherwise would impair the security of the bonds authorized by this ordinance or additional parity bonds permitted to be issued under Section 21 hereof, shall be deducted. ( 3) The term ".Bonds 11 whenever same appears in this ordinance without any qualifying language, shall mean the $1,666,000 of revenue refunding bonds authorized by this ordinance. (4) The expression uAdditional Parity .Bonds" shall mean those bonds which the City reserves the right to issue under the provisions of Section 21 hereof. (5) The term "Underlying Bonds" shall mean: the "City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 1949,11 dated May 1, 1949, Numbers/JI.51 through 2300, due serially.on May 1st in each of the years 1964 through 1969, aggregating the principal sum of $850,000; "City of Lubbock, Texas, Electric Light System Revenue Bonds, Series 1951", dated January 1,_ 1951, Numbers 419 through 774, due serially on January 1st in each of the years 1964 through 1971, aggregating the principal sum of $356,000 and ~City of Lubbock, Texas, Electric Light System Revenue ·, Refunding Bonds," dated September 1, 1958, Numbers 491 through 950, due serially on September 1st in each of the years 1964 through 1968, aggregating the principal sum of $460,000, all of which are to be discharged, redeemed and cancelled with the proceeds of the bonds herein authorized. SECTION 12: Pledge. The City of Lubbock covenants and agrees that all of the net revenues of the System are hereby irrevocably pledged equally for the payment of principal and interest of the bonds and the additional parity bonds if issued under the conditions and in the manner specified in this ordinance, all of which shall constitute a first lien on and pledge of the net revenues of the System. SECTION 13: System Fund. All receipts, revenues and income of every nature in any manner derived from ownership and operation of the System shall constitute a separate and sacred fund which in no event shall be diverted or drawn upon except under the provisions and for the purposes herein prescribed. All such receipts, revenues and income shall be paid over and deposited with the City's depository within twenty four (24) hours after collection. The account to which said Fund shall be deposited shall be known as the Electric Light and Power System Fund (hereinafter referred to as the "System Fund u) to be kept separate and apart from all other city funds or accounts. Specifically as related to the bonds herein authorized, the S~tem Fund shall be and is hereby pledged and shall be devoted and applied to the purposes enumerated in Section 14 following and in the order of precedence shown therein. SECTION 14: Flow of System Fund. All moneys paid over and deposited in the System Fund as provided in Section 13 above shall be pledged, appropriated and employed as follows: (1) For the payment of those necessary and reasonable expenses of operating and maintaining the System as are set forth in Paragraph 2 of Section 11 hereof relating to the definition of "Net Revenues". (2) To the uSpecial Electric Light and Power System Re~ue Refunding Bonds, Series 1963 Retirement and Reserve Fund11 {hereinafter referred to as the "Bond Fund 11 ) hereby . . created for the bonds herein authorized which shall be used for no purpose other than for the payment, redemption and retirement of such bonds and the interest thereon, in accordance with the terms and provisions of this ordinance. All funds received from the purchasers of the bonds as accrued interest thereon to the date of delivery shall be placed in this Fund. In addition to the City1s obligation to provide this Fund with all amounts required to pay as ----- due each of the semi-annual principal and interest installments pertaining to the bonds herein authorized, said Bond Fund shall contain a reserve portion in the sum of $ 360#000 Said amount of $ 360~000 being on deposit in the ------------------ City's official Depository to the credit of the underlying bonds, said amount is hereby appropriated for the purpose of constituting the reserve portion of the Bond Fund herein established and the proper City Officials are hereby autho- rized and directed to take such steps as are necessary to transfer such amount from the funds heretofore provided for the underlying bonds, immediately upon the sale and delivery of the bonds herein authorized, and to set same over into the Bond Fund herein established so that same may constitute the reserve portion thereof. It is the City1 s Purpose and intent, and it so covenants, that the reserve portion of the Bond Fund shall be continuously maintained in the sum of $ 360,000 in excess of the next maturing installment of principal and interest of the bonds until all of same and all interest perta1ning thereto have been fully paid and discharged, or, until such time as said Bond Fund, including said reserve portion, shall contain 0 amounts equal to the total principal and interest require- ments of said bonds then outstanding to their final maturity. Said reserve shall be used for the purpose of meeting the requirements of the bonds, if need be, and if at any time any amount of said reserve is required for use as aforesaid~ said reserve shall be supplemented out of the first system funds available therefor to such extent as will make up the deficiency in said reserve as rapidly as possible. The pledge of the System Fund for the reserve portion of the Bond Fund shall be subordinate only to the actual interest and principal requirements of the bonds or additional parity bonds. SECTION 15: Method of Proviqing Amounts for Semi- annual Interest and Princi~a~ Requirements of the Bonds. Immediately upon issuance and delivery of the bonds herein autho- rized the City Treasurer shall transfer all moneys remaining in the Special Interest and Sinking Fund Accounts of the underlying bonds to the "Bond Fund" herein created. Further the City Treasurer is instructed to calculate the amount of each next succeeding installment of interest and principal of the bonds and~ when transferred moneys are no longer adequate, to withdraw the necessary amounts from the System Fund and deposit them in equal monthly installments in the Bond Fund. Upon the employment and exhaustion of all the aforementioned transferred amounts the monthly deposits for bond requirements shall be made on the 1st day of each month and shall consist of not less than one-sixth of the next semi-annual installment of interest and principal. In the event the income and revenues of the System are insuffi- cient in any month to permit the required deposits into the Bond Fund in accord with the provisions hereof or if for any other reason the City shall fail to make the required deposits into the Bond Fund (including the reserve portion if same has become depleted) the amount of such deficiencies shall be made up as promptly as available System Funds will permit. SECTION 16: Surplus Revenues. After all requirements of Paragraphs 1 and 2 of Section 14 hereof have been satisfied and all similar requirements of any additional parity bonds hereafter issued and after all deficiencies existing in such req~ments have been remedied, surplus revenues of the System may be used for any other proper city purposes now or hereafter permitted by General Law, including the use thereof for retiring in advance of maturity any such bonds or additional parity bonds by purchase on the open market at not exceeding the market value thereof. Nothing herein shall be construed, however, as impairing the right of the City to pay, in accordance with the provisions thereof, any junior lien bonds legally issued by it. SECTION 1~: Security for Eleonric System Bond Fund. All funds herein provided for the Electric System Bond Fund herein established shall be kept separate and apart from all other city funds and shall be continuously secured by a valid pledge of direct obligations of, or obligations unconditionally guaranteed by the United States of America, having a par value, or market value when less than par, exclusive of accrued interest, at all times at least equal to the amount of money to be deposited in said fund. All sums deposited in said bond fund shall be held as a trust fund for the benefit of the h~lders of the bonds herein authorized, the beneficial interest in which shall be regarded as existing in such holders. To the extent that money in the reserve portion of the Bond Fund is invested under the provisions of Section 19 hereof such security is not required. SECTION 18: Custodian of Bond Fund. The custodian of the Bond Fund shall be the City's official depository bank, and all deposits prescribed shall be placed in said fund with said custodian bank. Prior to each interest and principal maturity date it shall be the duty of the City Treasurer to withdraw from said fund and place with the paying agent banks money in such amounts as will be fully sufficient to pay and at such times as will permit prompt payment of each interest and principal installment. SECTION 19: Investment of Reserve Portion of Bond Fund. The Custodian Bank shall, when authorized by the City Commission invest the reserve portion of the Bond Fund in direct obligations of, or obligations guaranteed by the United States of America, or invested in direct obligations of the Federal Intermediate Credit Banks, Federal Land Banks, Federal National Mortgage Association, Federal Home Loan Banks or Banks for Cooperatives, and which such investment obligations must mature or be subject to redemption at the option of the holder, within not to exceed ten years from the te of making the investment. Such obligations shall be held by the depository impressed with the same trust for the benefit of the bondholders as the Bond Fund itself and if at any time uninvested funds shall be insufficient to permit payment of principal and in- terest maturities herein authorized as herein directed the said depository shall sell on the open market such amount of the securi- ties as is required to pay said bonds and interest when due and shall give notice thereof to the City Treasurer. All moneys result- ing from maturity of principal and interest of the securities in which the reserve funds are invested shall be reinvested or accumu- lated in said reserve portion of said Bond Fund and considered a part thereof and used for and only for the purposes hereinabove provided with respect to said reserve. SECTION 20: Rates and Charges. The City of Lubbock covenants and agrees that so long as any of the revenue bonds and coupons herein authorized remain outstanding and unpaid it shall fix and maintain rates and collect charges for the facilities and services afforded by its Electric Light and Power System~ which will produce income and revenues sufficient at all times to: (~l Pay all necessary operation~ maintenance and betterment charges and expenses of the System; (b) Establish and ful)ymaintain the "Bond Fund" including the reserve portion thereof for the bonds herein authorized and for any additional parity bonds hereafter issued in accordance with the provisions hereof; (c) Pay the requirements of all other lawful obli- gations and indebtedness of the System chargeable against the System, as and when the same shall accrue and become due. SECTION 21: Issuance of Additional Parity Bonds. In addition to the right to issue bonds of inferior lien as authorized by the laws of the State of Te~as~ the City of Lubbock reserves the right to issue further revenue bonds payable from the net income and revenues of the System and when issued in compliance with law and the terms and conditions hereinafter appearing such additional bonds shall occupy a position of parity with and shall be equally and ratably secured by a first lien on and pledge of the net revenues of the System to the same extent as the series of bonds authorized by this ordinance. The City hereby ·covenants and agrees that no additional bonds or other obligations payable from the net revenues of its Electric Light and Power System shall be issued on a parity with the series of bonds herein authorized unless and until the following conditions have been met: (a) That the Mayor and City Treasurer have certified that the City is not then in default as to any covenant, con- dition or obligattn prescribed by this ordinance or any ordinance authorizing thei tssuanee of additional parity bonds then outstand- ing, including showings that all interest, sinking and reserve funds then provided for have been tully maintained in accordance with the provisions of said ordinances. (b) That the applicable laws of the State of Texas in -force at the time provide permission8ld author~ty for the issuance of such bonds and have been tully complied with; (e) That the City has secured from an independent cer- tified public accountant his writt~n report demonstrating that the net revenues of theSystem were, during the last completed fiscal year, or during any consecutive twelve (l2)month period of the last fifteen (15) consecutive months prior to .the month of adoption of the ordinaneej authorizing the additional parity bonds, equal to at least one and one-half (l-1/2) times the average annual principal and interest requirements of all the bonds which will be secured by a first lien on and pledge or the net revenues or the System and which wi~l be outstanding upon the issuance or the addi- tional parity bonds; and further demonstrating that for the same period as is employed in arriving at the aforementioned test said net revenues were equal to at least one and one-fifth (1-1/5) times the maximum annual principal and interest requirements of all such ~ bonds as will be outstanding upon the issuance of the additional parity bonds; (d) That the additional parity bonds ~re made to mature on April 15 or October 15, or both, in each of the years in which they are provided to mature; (e) The ordinances authorizing each series of additional parity bonds shall provide a reserve for their interest and sinking fund which reserve shall be in an amount equal to not less than the average annual principal and interest requirements of such bonds and to be provided either by outright deposit or by an accumulation of equal monthly deposits over a period ot not more than siXty months from the creation or the intemst and sinking fund ( I When thus issued such additional parity bonds may be secured by a pledge of the revenues of the City's System on a parity in all things with the pledge securing the issuance of the bonds herein authorized. SECTION 22: Maintenance and Operation. The City of Lubbock hereby covenants and agrees that it will maintain the S~tem facilities in good condition and operate the same in an efficient manner and at reasonable costs so long as the bonds or the additional parity bonds are outstanding and unpaid. The City further agrees to maintain insurance for the benefit of the holder or holders of the bonds of the kinds and in the amounts which are usually carried by private companies operating similar properties, and that during such time all policies of insurance shall be maintained in force and kept current as to premium payments. All moneys received from losses under such insurance policies other than public liability policies are hereby pledged as security for the bonds until and unless the proceeds thereof are paid out in making good the loss or damage in respect of which such proceeds are received, either by replacing the property destroyed or repairing the property damaged, and adequate provisions made within ninety {90) days after the date of the loss for making good such loss or damage. The premiums for all insurance policies required under the pro- visions of this section shall be considered as maintenance and operation expenses. SECTION 23: Records and Accounts. The City of Lubbock .hereby covenants and agrees that so long as any of the bonds herein authorized, or any interest thereon, remain outstanding and unpaid, it will keep and maintain a proper·; and complete system of books, records and accounts pertaining to the operation of the System, separate and apart from all other records and accounts in which complete and correct entries shall be made of all transactins relating to the System as provided by Article 1113, Revised Civil Statutes of Texas, 1925, as amended, and that the holder or holders of any of the bonds or any duly authorized agent or agents of such holders shall have the right at all reasonable times to inspect all such books, records, accoun s and data relating thereto and to inspect the System and all pro- perties comprising same. The appropriate City officials are hereby instructed and directed to do any and all things necessary or convenient in reference to keeping and maintaining of such books, records and accounts and to make the moneys available for payment of the bonds in the manner provided by the aforementioned statute. The City further agrees that within sixty (60) days following the close of each fiscal year it will cause an audit of its books and accounts to be made by an independent firm of Certified Public Accountants showing the receipts and disburse- ments for the account of the system for the fiscal year. Each such audit shall, in addition to whatever other matter may be thought proper by the Accountant, particularly include the following: {a) A detailed statement of the income and expendi- tures for account of the System for such fiscal year; (b) A balance sheet as of the end of such fiscal year; (c) The Accountant's comments regarding the manner in which the City has carried out the requirements of this ordinance, and his recommendations for any change or improvements in the operation, records and accounts of the System; (d) A list of the insurance policies in force at the ·end of the fiscal year on system properties, setting out as to each policy the amount thereof, the risk covered, the name of the insurer and the policy's expiration date; (e) A statement verifying that the securities herein specified therefor have been on deposit aw security for the money in the Electric Light and Power System Bond Fund throughout the fiscal year, and a list of the securities, if any, in which the reserve portion of such Special Fund have been invested. (f) The number of metered and unmetered customers, if any, connected with any department of the System, showing totals at the end of the fiscal year. Expenses incurred in making the audits above required are to be regarded as maintenance and operation expenses and paid as such. Copies of the aforesaid annual audit shall be promptly furnished the original purchasers of the bonds and any subsequent holder at his request. At the close of the first six months' period of the fiscal year, the City Manager is directed to furnish a copy of an operating and income statement in reason- able detail covering such period to any bondholder upon his request therefor, received not more than thirty days after the close of said six months' period. Any bondholder shall have the right to discuss with the Accountants making the annual audit the contents thereof and to ask the City Manager for such additional information as he may reasonably request. SECTION 24: Remedies in Event of Default. In addition to all the rights and remedies provided by law by the State of Teaas, the City covenants and agrees particularly that in the event the City (a) defaults in payment of principal or interest on any of the bonds when due, (b) fails tp make the payments into the Bond Fund as required by SWction 14 of this ordinance, or {c) defaults in the observance or performance of any other of the covenants, conditions or obligations set forth in this ordinance, the following remedies shall be available: 1. The holder or holders of any of the bonds shall be entitled to a writ of mandamus issued by a court of proper jurisdiction compelling and requiring the City Commission and other officers of the City to observe and perform any covenants, obligations or conditions prescribed in the bond ordinance. 2. No delay or omission to exercise any right or power accruing upon any default shall impair any such power or right or shall be construed to be a waiver of any such default or acquiescence therein, and every such right and power may be exercised from time to time and as often as may be deemed expedient. The specific remedies herein provided shall be cumula- tive of all other existing remedies and the specification of such shall not be deemed to be exclusive. SECTION 25: Sale, Lease or Other Encumbrance of System. The City of Lubbock further covenants and binds and oblj.gates itself not to sell, lase or in any manner dispose of the System, its properties, or any part thereof, including any and all extensions and additions that may be made thereto, and it ack- nowledges and accepts restraint from doing so until the bonds herein authorized shall have been paid in full as to both principal and interest at rna turi ty, or under the previsions hereof relating to their redemption prior to maturity, or until other arrangements have been made for continuance of payment of principal and interest then outstanding for the full retirement thereof; provided, however, that this covenant shall not be construed to prevent the disposal by the City of property which in its judgment has become inexpedient to use in connection with the System when other property of equal value has been substituted therefor. SECTION 26: Further Covenants. The City further covenants and agrees by and through this ordinance as follows: (a} That it has the lawful power to pledge the revenues supporting this issue of bonds and has lawfully exercised said power under the Constitution and laws of the State of Texas, including the powers existing under Articles 1111 to 1118, both inclusive, 1925 Revised Civil Statutes of the State of Texas, with amendments thereto, and that the bonds issued hereunder, along with any additional parity bonds issued pursuant to the provisions hereof shall be ratably secured in such manner that no one bond of any such issues shall have preference over any other bond of such issues. (b) That excepting the pledge made for payment of the underlying bonds, all of which are subject to the City's option to redeem same prior to their stated maturi- ties, to-wit: on November 1, 1963, January 1, 1964 and March 1, 1964, respectively, the net revenues and income of the System are pledged exclusively to the payment of the bonds herein authorized and such additional parity bonds as may hereafter be issued pursuant to the pro- visions hereof; that said net revenues and income have not been pledged in any manner to the payment of any other debt or obligation of the City or the System and otherwise said System is free and clear of all encum- ~rances whatsoever; that, pursuant to the provisions of applicable law and prior to delivery of the bonds herein authorized the City will make due and full provision for the ultimate payment and discharge of principal, interest and call premiums pertaining to said underlying bonds and for the payment of all fees and expenses incident to their payment and discharge. (c) That nothing in this ordinance shall require the City to make any expenditure except from money in the System Fund, but nothing herein shall prohibit the City from doing so at its election. (d) That except under the conditions of this ordinance relating to parity bonds, the City will not suffer any indebtedness on a parity or superior to the bonds of this issue to accrue the City or said System and that if the System shall become liable for any other indebtedness, the City Commission will fix and maintain rates and collect charges for the services afforded by the System entirely sufficient to discharge any such indebtedness or obligation. (e) The City will cause to be rendered monthly to each customer receiving electric services a statement therefor and will not accept payment of less than all of any statement so rendered, using its powers under existing ordinances and under all such ordinances to become effective in the future to enforce payment, to withold service from such delinquent austomers and to enforce au authorize reconnection charges. (f) The City will allow no free services from the System and shall require payment of the reasonable value thereof by itself or any of its agents or instrumentalities, such payments to be made out of funds derived from sources other than as revenues of the System. (g) That the City will faithfully and punctually perform all duties with respect to the System required by the Constitution and laws of the State of Texas, including the making and collecting of reasonable and suf~icient rates for services supplied by the System, and the segregation and application of the revenues of the System as required by the provisions of this ordinance. SECTION 27: Ordinance to Constitute Contract. That the provisions of this ordinance shall constitute a contract between the City of Lubbock and the holder or holders from time to time of the bonds herein authorized to be issued, and after the issuance of any of said bonds, no change, variation or alteration of any kind of the provisions of this ordinance may be made, unless as herein otherwise provided, until all of the bonds issued hereunder shall have been paid as to both principal and interest. SECTION 28: Bonds are Special Obligations. The bonds herein authorized are special obligations of the City of Lubbock payable from the pledged revenues, and the holder thereof shall never have the right to demand payment thereof out of funds raised or to be raised by taxation. SECTION 29: Maygr to Have Ch~rge of Records and Bo~d~. That the Mayor of said City shall be, and he is hereby authorized to take and have charge of all necessary records and orders pendi investigation by the Attorney General of the State of Texas, and shall take and have charge and control of the bonds herein authorized pending their approval by the Attorney General and thei registration by the Comptroller of Public Accounts. It shall be the duty of the Mayor {or Attorneys acting for the City) to submit the record of said bonds and the bonds to the Attorney General of the State of Texas for approval and thereafter to have the bonds registered by the Comptroller of Public Accounts. SECTION 30: Delivery of Bond~.to Purchaser. The bonds herein authorized when properly executed by the City officials, and approved by the Attorney General of Texas shall be delivered to the purchaser thereof as promptly as possible in order to make available in due time at the Office of the Treasurer of the State of Texas, the deposit of funds needed to redeem and discharge the underlying bonds on their respective redemption call dates, as required by law. SECTION 31: Payment of Underlying Bonds. The City Treasurer shall calculate the amounts required to pay the follow- i~: (a) The principal, interest and redemption premium, if any, required to fully redeem, pay and discharge the underlying bonds on their respective redemption call dates; (b) The statutory fees of the State Treasurer; and (c) The fees of the paying agent banks. The amounts so determined to be sufficient to pay such requirements to the respective redemption call dates of the under- lying bonds shall be deposited with the State Treasurer under the provisions of Article 717k, V.A.T.C.S. All amounts determined to be required, except $1,666,000, shall be forthwith deposited with said State Treasurer, and upon delivery of the bonds herein authorized the sum of $1,666,000 out of the proceeds thereof shall be deposited immediately with such official. The City Treasurer shall instruct the State Treasurer of the purposes of the deposits; that such funds are to be used for no other purpose; that the sums required to pay and discharge such outstanding bonds (including principal, interest and redemption premiums and fees of the paying agent banks) are to be transmitte in appropriate amounts to the respective banks of payment of the underlying bonds, to-wit: the First National Bank in Dallas, Dallas, Texas; the American National Bank and Trust Company Of Chicago, Chicago, Illinois; and the Mercantile National Bank at Dallas, Dallas, Texas. SECTION 32: Printed Legal Opinion on Bonds. The pur- chaser's obligation to accept delivery of the bonds herein authorized is subject to their being furnished a final opinion of Messrs. Dumas, Huguenin and Boothman, Attorneys, Dallas,Texas, \ approving such bonds as to their validity, said opinion to be dated and delivered as of the date of delivery and payment for such bonds. Printing of a true and correct copy of said opinion on the reverse side of each of said bonds with appropriate certificate pertaining thereto executed by facsimile signature of the City Secretary is hereby approved and authorized. SECTION 33: Emergency. The public importance of this measure and the fact that it is to the best interest of theCity of Lubbock to provide the bonds herein authorized so as to pay off, redeem, discharge and cancel the underlying indebtedness at the earliest possible date for the immediate preservation of the public peace, property, health and safety of the citizens of said City, constitute and create an emergency and an urgent public necessity requiring that this ordinance be passed to take effect as an emergency measure and that this ordinance is accordingly passed as an emergency measure and shall take effect and be in force immediately from and after its passage, and IT IS SO O~INEDo PASSED AND APPROVED, this the 3rd day of October, 1963. as City f Lubbock,Texas (City seal) ----n; LubbOclt County Sheriff's Department s e r v e d citations Thursday aftemoon on Henry Matthewa,.m, representative ot First Southwest Co., and Mrs. Lavenla Williams, city secre- tary, wblle the commission was In sea!on. :M.Qor Jack Strong alto was named In the petition aa one of the perrcna on 'Who~ce of citatkla mllbt be m ~Ia Griffith tiled the suit Oft Hayes behalf. ( It aeeJra "an lnJunctJon • . . prohibltlnc the City of Lubbock from paying out any public funds upon the 'City ot ~bbock, Texas, Electric Ught System R e v e ll q e Refundfillf Bonds' dated flpt. 1. 1958, Mid pro-hibitiftl~t.\ Sou~t Co. from and receiving any IUch bonds.'' Hayes aDeiel tliaton or about July ."H, 1958, tilt ci1¥ "was ostensibly obligated" ~~virtue of $1,0110,001l~ value~ectric Light 8)'llfi.!i Revenue Bonds dated Marclt..J. 1948. · .lib The pedtiCJl states mat the defendants --~ ret!f mut· :::s ':~~ new,.,:~~ Into the h First ~th- west Co. Jn vJolatain of the laws of tate ol Texas and the charter. of the Citv of Lubbock." , ~,. It also is alleged that the city Issued notice ot redemptlob of the 1948 series ~ banda and contracted wfth1Flnt Southwest to redeem the1h and handle lee-at requiremeau for issue of refunding bonl~tini ., oo~<;~ol~.:S~~~ct was iDegaJ "as it not gfjen after due notice, a lng i nd competitive bids, for the 'Cialma lateM~& As Taxpa,. reason that it ~ a "Such bonds are invalid void corporation peri ' ... 'IN·/ and unenforceable anl Ices" ' H~ alle.,es that PU171Uant to same should be canceled, "' ·.!1::: 4-...:-no funds should be paid out the c.qntract. tbe CitY m:iued to the public tor lllme First-Southwest its tight system Hayes ' re\tenue refunding bonds, series He of11958, dated Sept.: , 1958, with·) out advertillng or sale in di&chi!IP~ illy newspaper of lation. Hayes "contrary to law and the of the City of Lubbock." The plaintiff further that the city has paid off a tion of the 1958 bonds and there remains unpaid the bonds amounting to ¥mu.UIIUI in face value. ment of "said legal" bonds excepttpg by order In the natuW' of an junction. .!