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HomeMy WebLinkAboutResolution - 4633 - Special Escrow Agreement - Nationsbank - Certificates Of Obligation - 10_13_1994yU33 A RESOLUTION relating to the redemption of certain bonds, approving the form and content of a Special Escrow Agreement with NationsBank of Texas, National Association, for the deposit of funds in an amount sufficient to pay certain certificates of obligation and to pay certain bonds; authorizing the execution of such Agreement and resolving other matters incident and related thereto. WHEREAS, the City has heretofore issued and there are currently outstanding, obligations for (or allocated to obligations issued for) golf course purposes in the total principal amount of $590,000 (collectively referred to herein as the "Defeased Obligations") of the following described issues: $205,000 of City of Lubbock, Texas, Combination Tax and Golf Course Revenue Certificates of Obligation, Series 1988 (the "Series 1988 Obligations") and $385,000 of City of Lubbock, Texas, General Obligation Refunding Bonds, Series 1993 (the "Series 1993 Obligations"); WHEREAS, in accordance with the provisions of Section 7A of Article 717k, V.A.T.C.S., as amended, the City is authorized and empowered to deposit available funds directly with any place of payment for the Defeased Obligations in an amount sufficient to provide for the full payment thereof, and such deposit, if made on or before the payment date for such obligations, shall constitute the making of firm banking and financial arrangements for the discharge and final payment of the obligations being paid; WHEREAS, in order to eliminate the existing restrictive covenants regarding the use in a trade or business of the City's Golf Course by persons other than governmental units as a means of achieving a favorable operational cash flow and to reduce the amount of ad valorem property taxes that would otherwise be required to be assessed and collected with respect to the Defeased Obligations, the City has determined to deposit funds in an amount sufficient to defease the Defeased Obligations; WHEREAS, the City is authorized, in accordance with the ordinance authorizing the issuance of the Series 1993 Obligations to call for redemption on February 15, 2001, at the price of par plus accrued interest to the date of redemption, all or less than all (and, if less than all, to select by lot) of the Series 1993 Obligations originally scheduled to mature on and after February 15, 2002, and the City has determined to call for redemption less than all of the Series 1993 Obligations (the particular Series 1993 Obligations to be redeemed to be selected by lot) in the aggregate principal amount of $215,000 (hereinafter referred to as the "Redeemed Series 1993 Obligations"); 0202674 J+033 WHEREAS, a Special Escrow Agreement has been prepared in connection with the deposit of funds with NationsBank of Texas, National Association to provide for the final payment and discharge of the Defeased Obligations, such agreement being attached hereto as Exhibit A and incorporated herein by reference as a part of this Resolution for all purposes; and WHEREAS, the Council hereby finds and determines that the form and content of the Special Escrow Agreement, providing for the deposit of funds with NationsBank of Texas, National Association for the final payment and discharge of the Defeased Obligations should be approved; now, therefore, TEXAS: BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK, SECTION 1: That the above recitals are true and correct; SECTION 2: That the "Special Escrow Agreement", attached hereto as Exhibit A. and incorporated herein by reference as a part of this Resolution for all purposes, is hereby approved as to form and content, and such Agreement in substantially the form and substance attached hereto, is hereby authorized to be executed by the Mayor and City Secretary for and on behalf of the City and as the act and deed of the City Council; and such Agreement as executed by said officials shall be deemed approved by the City Council and constitute the Agreement herein approved. SECTION 3: That NationsBank of Texas, as Paying Agent/Registrar for the Series 1993 Obligations is directed to conduct a lottery in order to select the particular Series 1993 Obligations within each maturity to be defeased. The amount of Series 1993 Obligations per maturity to be defeased is shown on Exhibit B attached hereto and incorporated herein by this reference for all purposes. The Series 1993 Obligations selected by lottery for defeasance and originally scheduled to mature on February 15 in each of the years 2002 through 2008, and aggregating $215,000 in principal amount are hereby called for redemption on February 15, 2001, at the price of par plus accrued interest to the date of redemption. SECTION 4: That the City Secretary is hereby directed to notify the Paying Agent/Registrar for the Redeemed Series 1993 Obligations (NationsBank of Texas, National Association) of the decision to redeem the Redeemed Series 1993 Obligations, the principal amount of each Stated Maturity to be redeemed, and the date of redemption therefor. SECTION 5: That the City Manager or any Assistant City Manager is hereby authorized and directed to cause to be deposited with NationsBank of Texas, National Association an amount not to 0202674 - 2 - exceed $�� �� a, U 3 on or before October 14, 1994, (or such later date as shall be mutually agreeable to the parties) in accordance with the terms of said Special Escrow Agreement. The City Manager or any Assistant City Manager, any one or more of such officials, are hereby authorized and directed to make the necessary arrangements for the purchase of the Federal Securities to be acquired and deposited to the credit of the "Escrow Fund" pursuant to the terms of the Special Escrow Agreement and such other arrangements as may be necessary for the for the final payment and discharge of the Def eased Obligations in accordance with the Agreement and this Resolution. PASSED AND ADOPTED, this October 13, 1994. CITY OF LUBBOCK, TEXAS ATTEST: City Secretary (City Seal) 0202674 - 3 - Mayor SPECIAL ESCROW AGREEMENT THE STATE OF TEXAS § § COUNTY OF LUBBOCK § THIS SPECIAL ESCROW AGREEMENT (the "Agreement"), dated and made effective as of August 11, 1994, made by and between the City of Lubbock, Texas, a duly incorporated municipal corporation in the County of Lubbock, Texas (the "City"), acting by and through the Mayor and City Secretary, and NationsBank of Texas, National Association (the "Bank"), a banking association organized and existing under the laws of the United States of America, W I T N E S S E T H: WHEREAS, the City has heretofore issued and there are currently outstanding, obligations for (or allocated to obligations issued for) golf course purposes in the total principal amount of $590,000 (collectively referred to herein as the "Defeased Obligations") of the following described issues: $205,000 of City of Lubbock, Texas, Combination Tax and Golf Course Revenue Certificates of Obligation, Series 1988 (the "Series 1988 Obligations") and $385,000 of City of Lubbock, Texas, General Obligation Refunding Bonds, Series 1993 (the "Series 1993 Obligations"); WHEREAS, in accordance with the provisions of Section 7A of Article 717k, V.A.T.C.S., as amended, the City is authorized and empowered to deposit available funds directly with any place of payment for the Defeased Obligations in an amount sufficient to provide for the full payment thereof, and such deposit, if made on or before the payment date for such obligations, shall constitute the making of firm banking and financial arrangements for the discharge and final payment of the obligations being paid; WHEREAS, in order to eliminate the existing restrictive covenants regarding the use in a trade or business of the City's Golf Course by persons other than governmental units as a means of achieving a favorable operational cash flow and to reduce the amount of ad valorem property taxes that would otherwise be required to be assessed and collected with respect to the Defeased Obligations, the City has determined to deposit funds in an amount sufficient to defease the Defeased Obligations; WHEREAS, the City is authorized, in accordance with the ordinance authorizing the issuance of the Series 1993 Obligations to call for redemption on February 15, 2001, at the price of par plus accrued interest to the date of redemption, all or less than all (and, if less than all, to select by lot) of the Series 1993 Obligations originally scheduled to mature on and after February 15, 2002, and the City has determined to call for redemption less than all of the Series 1993 Obligations (the particular Series 1993 Obligations to be redeemed to be selected by lot) in the 0202693 aggregate principal amount of $215, 000 (hereinafter referred to as the "Redeemed Series 1993 Obligations"); WHEREAS, the Defeased Obligations are scheduled to mature or be redeemed and interest thereon is payable on the dates and in the manner set forth in Exhibit A attached hereto and incorporated herein by reference as a part of this Agreement for all purposes; and WHEREAS, on the 14th day of October, 1994, the City will cause funds to be deposited to the credit of the Escrow Fund in an amount sufficient to purchase Federal Securities listed and identified in Exhibit B attached hereto and incorporated by reference as a part of this Agreement for all purposes; and WHEREAS, the Federal Securities shall be held and deposited to the credit of the "Escrow Fund" to be established and maintained by the Bank in accordance with this Agreement; and WHEREAS, the Federal Securities shall mature and the interest thereon shall be payable at such times to insure the existence of moneys sufficient to pay the principal amount of the Defeased Obligations and the accrued interest thereon, as the same shall become due at maturity, or early redemption, as the case may be in accordance with the terms of the ordinances authorizing the issuance of the Defeased Obligations, in each case as set forth in Exhibit A attached hereto; and WHEREAS, the City has completed all arrangements for the purchase of the Federal Securities listed in Exhibit B and the deposit and credit of the same to the Escrow Fund as provided herein; and WHEREAS, the Bank is a banking association organized and existing under the laws of the United States of America, possessing trust powers and is fully qualified and empowered to enter into this Agreement; and WHEREAS, pursuant to a resolution, adopted on October 13, 1993, the City Council of the City approved and authorized the execution of this Agreement; and WHEREAS, the City and the Bank, as the case may be, shall take all action necessary to pay and retire said Defeased Obligations in accordance with the provisions thereof, including, without limitation, all actions required by the ordinances authorizing the Defeased Obligations, the Act and this Agreement; NOW, THEREFORE, in consideration of the mutual agreements herein contained, and to secure the payment of the principal of and the interest on the Defeased Obligations as the same shall become due as shown on Exhibit A the City and the Bank hereby mutually undertake, promise and agree as follows: 0202693 - 2 SECTION 1: Receipt of a true and correct copy of the ordinances authorizing the issuance of the Defeased Obligations is hereby acknowledged by the Bank. Reference to or citation herein of any provision of said documents shall be deemed an incorporation of such provision as a part hereof in the same manner and with the same effect as if it were fully set forth herein. SECTION 2: There is hereby created by the City with the Bank a special segregated and irrevocable trust fund designated "SPECIAL 1994 CITY OF LUBBOCK, TEXAS, GOLF OBLIGATION ESCROW FUND' - (hereinafter called the "Escrow Fund") for the payment of the Defeased obligations and the City agrees and covenants to cause to be deposited with the Bank the following: $�,�I�a.� 3 as a beginning cash balance of $ m ;53. ,15 and for the purchase of the Federal Securities identified in Exhibit B to be held for the account of the Escrow Fund; $ 4,200.00 for payment of escrow fees of NationsBank of Texas, N.A.; and The Bank hereby accepts the Escrow Fund and further agrees to receive said moneys, apply the same as set forth herein, and to hold the cash and Federal Securities deposited and credited to the Escrow Fund for application and disbursement for the purposes and in the manner provided in this Agreement. The City hereby allocates the Federal Securities to the Defeased Obligations in accordance with Exhibit C attached hereto and incorporated by reference as a part of this Agreement for all purposes; such allocation of Federal Securities being based on the total amount of debt service on the Defeased Obligations that will actually be paid from the Escrow Fund. SECTION 3: The City hereby represents that the Federal Securities specified in Section 2 hereof, together with the interest to be earned thereon, deposited to the credit of the Escrow Fund will be sufficient to pay the principal of and interest on the Defeased Obligations as the same shall become due and payable, and such Defeased Obligations, and the interest thereon, are to mature and shall be paid at the times and in the amounts set forth and identified in Exhibit A attached hereto. SECTION 4: The Bank agrees that all Federal Securities, together with any income or interest earned thereon, held in the Escrow Fund shall be and is hereby irrevocably pledged to the payment of the principal of and interest on the Defeased Obligations (in accordance with the allocation set forth on Exhibit C) which will mature and become due on and after the date of this Agreement, and such funds initially deposited and to be received from maturing principal and interest on the Federal 0202693 - 3 - Securities in the Escrow Fund shall be applied solely in accordance with the provisions of this Agreement. SECTION 5: If, for any reason, the funds on hand in the Escrow Fund shall be insufficient to make the payments for the Defeased Obligations set forth in Exhibit A attached hereto and as shown in the allocation set forth on Exhibit C, as the same becomes due and payable, the City shall make timely deposits to the Escrow Fund, from lawfully available funds, of additional funds in the amounts required to make such payments. Notice of any such insufficiency shall be immediately given by the Bank to the City by the fastest means possible, but the Bank shall in no manner be responsible for the City's failure to make such deposits. SECTION 6: The Bank shall hold said Federal Securities and moneys in the Escrow Fund at all times as a special and separate trust fund, wholly segregated from other moneys and securities on deposit with the Bank; shall never commingle said Federal Securities and moneys with other moneys or securities of the Bank; and shall hold and dispose of the assets therein only as set forth herein. Nothing herein contained shall be construed as requiring the Bank to keep the identical moneys, or any part thereof, in said Escrow Fund, if it is impractical, but moneys of an equal amount, except to the extent such are represented by the Federal Securities, shall always be maintained on deposit in the Escrow Fund by the Bank, as escrow agent; and a special account evidencing such facts shall at all times be maintained on the books of the Bank. SECTION 7: The Bank shall collect and receive the principal of and interest on the Federal Securities as they respectively mature and become due and credit the same to the Escrow Fund. On or before each principal and/or interest payment date for the Defeased Obligations shown in Exhibit A attached hereto, the Bank, without further direction from anyone, including the City, shall cause to be withdrawn from the Escrow Fund the amounts required to pay the accrued interest and the principal of the Defeased Obligations due and payable on said payment date and the amount withdrawn from the Escrow Fund shall be immediately transmitted and deposited with the paying agent for the Defeased Obligations to be paid with such amount. The paying agent for the Series 1988 Obligations is First National Bank of West Texas and the paying agent for the Series 1993 Obligations is the Bank. If any Defeased Obligation shall not be presented for payment when the principal amount shall have become due, and if cash shall at such times be held by the Bank in trust sufficient in amount and available to pay the principal of such Defeased Obligation, it shall be the duty of the Bank to hold said cash without any liability for additional interest thereon after such maturity date, in trust for the benefit of the party entitled to payment, which party or parties shall thereafter be restricted exclusively to said cash for any claim of whatever nature on their part on or 0202693 -4- with respect to said Defeased Obligation, including for any claim for the payment thereof. All cash required by the provisions hereof to be set aside or held in trust for the payment of the Defeased Obligations and interest thereon shall be applied to and used solely for the payment of the Defeased Obligations and accrued interest with respect to which such cash has been so set aside in trust. Subject to the provisions of the last sentence of Section 26 hereof, cash held by the Bank in trust for the payment and discharge of any of the Defeased Obligations which remains unclaimed for a period of four (4) years after the stated maturity date of such Defeased Obligations shall be returned to the City. Notwithstanding the above and foregoing, any remittance of funds from the Bank to the City shall be subject to any applicable unclaimed property laws of the State of Texas. SECTION 8: All Defeased Obligations canceled on account of payment by the Bank shall be cremated or otherwise destroyed by the Bank, and an appropriate certificate of destruction furnished the City. SECTION 9: The escrow created hereby shall be irrevocable and an express lien shall exist on all moneys and Federal Securities in the Escrow Fund as security for the payment of the Defeased Obligations until such funds are paid out, used, and applied in accordance with this Agreement. SECTION 10: The Bank shall have no lien whatsoever upon any of the moneys or Federal Securities in the Escrow Fund for payment of services rendered hereunder, services rendered as Paying Agent for the Series 1993 Obligations, or for any costs or expenses incurred hereunder and reimbursable from the City. SECTION 11: The Bank shall be authorized to accept initially and temporarily cash and/or substituted securities pending the delivery of the Federal Securities identified in the Exhibit B attached hereto, or shall be authorized to redeem the Federal Securities and reinvest the proceeds thereof, together with other moneys held in the Escrow Fund in noncallable direct obligations of the United States of America provided such early redemption and reinvestment of proceeds does not change the repayment schedule of the Defeased obligations appearing in Exhibit A and the Bank receives the following: (1) an opinion by an independent certified public accountant to the effect that (i) the initial and/or temporary substitution of cash and/or securities for one or more of the Federal Securities identified in Exhibit B pending the receipt and delivery thereof to the Escrow Agent or (ii) the redemption of one or more of the Federal Securities and the reinvestment of such funds in one or more substituted securities (which shall be noncallable direct obligations of the United States 0202693 - 5 - of America), together with the interest thereon and other available moneys then held in the Escrow Fund, will, in either case, be sufficient to pay, as the same become due in accordance with Exhibit A, the principal of, and interest on, the Defeased Obligations which have not previously been paid, and (2) with respect to an early redemption of Federal Securities and the reinvestment of the proceeds thereof, an unqualified opinion of nationally recognized municipal bond counsel to the effect that (a) such investment will not cause interest on the Defeased Obligations to be included in the gross income for federal income tax purposes, under the Code and related regulations as in effect on the date of such investment, or otherwise make the interest on the Defeased Obligations subject to Federal income taxation and (b) such reinvestment complies with the Constitution and laws of the State of Texas and with all relevant documents relating to the issuance of the Defeased Obligations. SECTION 12: Except as provided in Section 11 hereof, moneys in the Escrow Fund will be invested only in the Federal Securities listed in Exhibit B, and neither the City nor the Bank shall reinvest any moneys deposited in the Escrow Fund except as specifically provided by this Agreement. SECTION 13: If at any time there exists or it is determined an excess of interest on or maturing principal of the Federal Securities in excess of the aggregate amount needed to pay the Defeased Obligations, the Bank may transfer such excess amount to or on the order of the City. SECTION 14: The Bank shall continuously secure the moneys in the Escrow Fund not invested in Federal Securities by a pledge of direct obligations of the United States of America, in the par or face amount at least equal to the principal amount of said uninvested moneys to the extent such money is not insured by the Federal Deposit Insurance Corporation. SECTION 15: The Bank shall not be liable or responsible for any loss resulting from any investment made in the Federal Securities. SECTION 16: The funds and Federal Securities received by the Bank under this Agreement shall not be considered as a banking deposit by the City and the Bank and the City shall have no right or title with respect thereto, except as otherwise provided herein. Such funds and Federal Securities shall not be subject to checks or drafts drawn by the City. 0202693 - 6 - SECTION 17: The City agrees to pay the Bank for the performance of services hereunder and as reimbursement for anticipated expenses to be incurred hereunder the amount of $4,200.00 and, except for reimbursement of costs and expenses incurred by the Bank pursuant to Sections 3 and 20 hereof, the Bank hereby agrees said amount is full and complete payment for the administration of this Agreement. The City also agrees to pay the Bank, on an annual basis from lawfully available funds for the services rendered and to be rendered as paying agent for the Defeased Obligations. The City agrees to pay the Bank directly all reasonable costs, expenses and charges incurred in connection with the maintenance of the registration books and records and the transfer of such fully registered obligations as and when such costs, expenses and charges are incurred and against written invoices, statements or bills submitted therefor. SECTION 18: The Bank shall not be responsible for any recital herein, except with respect to its organization and its powers and authority. As to the existence or nonexistence of any fact relating to the City or as to the sufficiency or validity of any instrument, paper or proceedings relating to the City, the Bank shall be entitled to rely upon a certificate signed on behalf of the City by its Mayor or City Manager of the City as sufficient evidence of the facts therein contained. The Bank may accept a certificate of the City Secretary under the City's seal, to the effect that a resolution or other instrument in the form therein set forth has been adopted by the City Council of the City, as conclusive evidence that such resolution or other instrument has been duly adopted and is in full force and effect. The duties and obligations of the Bank shall be determined solely by the express provisions of this Agreement and the Bank shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Agreement, and no implied covenants or obligations shall be read into this Agreement against the Bank. In the absence of bad faith on the part of the Bank, the Bank may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificate or opinion furnished to the Bank, conforming to the requirements of this Agreement; but notwithstanding any provision of this Agreement to the contrary, in the case of any such certificate or opinion or any evidence which by any provision hereof is specifically required to be furnished to the Bank, the Bank shall be under a duty to examine the same to determine whether it conforms to the requirements of this Agreement. 0202693 - 7 - The Bank shall not be liable for any error of judgment made in good faith by a Responsible Officer or Officers of the Bank unless it shall be proved that the Bank was negligent in ascertaining or acting upon the pertinent facts. The Bank shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the holders of not less than a majority in aggregate principal amount of all said Defeased Obligations at the time outstanding relating to the time, method and place of conducting any proceeding for any remedy available to the Bank not in conflict with the intent and purpose of this Agreement. For the purposes of determining whether the holders of the required principal amount of said Defeased Obligations have concurred in any such direction, Defeased Obligations owned by any obligor upon the Defeased Obligations, or by any person directly or indirectly controlling or controlled by or under direct or indirect common control with such obligor, shall be disregarded, except that for the purposes of determining whether the Bank shall be protected in relying on any such direction only Defeased Obligations which the Bank knows are so owned shall be so disregarded. The term "Responsible Officers" of the Bank, as used in this Agreement, shall mean and include the Chairman of the Board of Directors, the President, any Vice President and any Second Vice President, the Secretary and any Assistant Secretary, the Treasurer and any Assistant Treasurer, and every other officer and assistant officer of the Bank customarily performing functions similar to those performed by the persons who at the time shall be officers, respectively, or to whom any corporate trust matter is referred, because of his knowledge of and familiarity with a particular subject; and the term "Responsible Officer" of the Bank, as used in this Agreement, shall mean and include any of said officers or persons. SECTION 19: Time shall be of the essence in the performance of obligations from time to time imposed upon the Bank by this Agreement. SECTION 20: In the event conflicting demands or notices are made upon the Bank growing out of or relating to this Agreement or the Bank in good faith is in doubt as to what action should be taken hereunder, the Bank shall have the right at its election to: (a) Withhold and stop all further proceedings in, and performance of, this Agreement with respect to the issue in question and of all instructions received hereunder in regard to such issue; and 0202693 -8- (b) File a suit in interpleader and obtain an order from a court of appropriate jurisdiction requiring all persons involved to interplead and litigate in such court their several claims and rights among themselves. In the event the Bank becomes involved in litigation in connection with this Section, the City to the extent permitted by law agrees to indemnify and save the Bank harmless from all loss, cost, damages, expenses and attorney fees suffered or incurred by the Bank as a result thereof. The obligations of the Bank under this Agreement shall be performable at the principal corporate office of the Bank in the City of Dallas, Texas. The Bank may advise with legal counsel in the event of any dispute or question regarding the construction of any of the provisions hereof or its duties hereunder, and in the absence of negligence or bad faith on the part of the Bank, no liability shall be incurred by the Bank for any action taken pursuant to this Section and the Bank shall be fully protected in acting in accordance with the opinion and instructions of legal counsel that is knowledgeable and has expertise in the field of law addressed in any such legal opinion or with respect to the instructions given. SECTION 21: Promptly after September 30 of each year, commencing with the year 1995, so long as the Escrow Fund is maintained under this Agreement, the Bank shall forward to the City, to the attention of the City Secretary, or other designated official of the City, a statement in detail of the Federal Securities and monies held, and the current income and maturities thereof, and the withdrawals of money from the Escrow Fund for the preceding 12 month period ending September 30th of each year. SECTION 22: Any notice, authorization, request or demand required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given when mailed by registered or certified mail, postage prepaid addressed as follows: CITY OF LUBBOCK: 1525 13th Street Lubbock, Texas Attention: Assistant City Manager 0202693 - 9 - NATIONSBANK OF TEXAS, N.A. 901 Main Street, 18th Floor Dallas, Texas 75202 Attention: Corporate Trust Department The United States Post Office registered or certified mail receipt showing delivery of the aforesaid shall be conclusive evidence of the date and fact of delivery. Any party hereto may change the address to which notices are to be delivered by giving to the other parties not less than ten (10) days prior notice thereof. SECTION 23: Whenever under the terms of this Agreement the performance date of any provision hereof, including the date of maturity of interest on or principal of the Defeased Obligations, shall be a Sunday or a legal holiday or a day when the Bank is authorized by law to close, then the performance thereof, including the payment of principal of and interest on the Defeased Obligations, need not be made on such date but may be performed or paid, as the case may be, on the next succeeding business day of the Bank with the same force and effect as if made on the date of performance or payment and with respect to a payment, no interest shall accrue for the period after such date. SECTION 24: The City covenants that it will faithfully perform at all times any and all covenants, undertakings, stipulations and provisions contained in this Agreement, in any and every said Defeased Obligation as executed, authenticated and delivered and in all proceedings pertaining thereto as said Defeased Obligations shall have been modified as provided in this Agreement. The City covenants that it is duly authorized under the Constitution and laws of the State of Texas to execute and deliver this Agreement, that all actions on its part for the payment of said Defeased Obligations as provided herein and the execution and delivery of this Agreement have been duly and effectively taken and that said Defeased obligations in the hands of the holders and owners thereof are and will be valid and enforceable obligations of the City according to the import thereof as provided in this Agreement. SECTION 24: If any one or more of the covenants or agreements provided in this Agreement on the part of the parties to be performed should be determined by a court of competent jurisdiction to be contrary to law, such covenant or agreement shall be deemed and construed to be severable from the remaining covenants and agreements herein contained and shall in no way affect the validity of the remaining provisions of this Agreement. In the event any covenant or agreement contained in this Agreement is declared to be severable from the other provisions of this Agreement, written notice of such event shall immediately be given 0202693 -10 - to Moody 's Investors Service, 99 Church Street, New York, New York 10007, Attention: Public Finance Rating Desk -- Refunded Bonds. SECTION 26: This Agreement shall terminate when the Defeased Obligations, including interest due thereon, have been paid and discharged in accordance with the provisions of this Agreement. If any Defeased obligations are not presented for payment when due and payable, the nonpayment thereof shall not prevent the termination of this Agreement. Funds for the payment of any Defeased obligations, which are not presented for payment, and accrued interest thereon shall upon termination of this Agreement be held by the Bank for such purpose in accordance with Section 7 hereof. Any moneys or Federal Securities held in the Escrow fund at termination and not needed for the payment of the principal of or interest on any of the Defeased Obligations shall be paid or transferred to the City. SECTION 27: (a) Should the Bank not be able to legally serve or perform the duties and obligations under this Agreement, or should the Bank be declared to be insolvent or closed for any reason by federal or state regulatory authorities or a court of competent jurisdiction, the City, upon being notified or discovering the Bank's inability or disqualification to serve hereunder, shall forthwith appoint a successor to replace the Bank, and upon being notified of such appointment, the Bank shall (i) transfer all funds and securities held hereunder, together with all books, records and accounts relating to the Escrow Fund and the Refunded Bonds, to such successor and (ii) assign all rights, duties and obligations under this Agreement to such successor. If the City should fail to appoint such a successor within ninety (90) days from the date the City discovers, or is notified of, the event or circumstance causing the Bank's inability or disqualification to serve hereunder, the Bank, or a bondholder of the Refunded Bonds, may apply to a court of competent jurisdiction to appoint a successor or assigns of the Bank and such court, upon determining the Bank is unable to continue to serve, shall appoint a successor to serve under this Agreement and the amount of compensation, if any, to be paid to such successor for the remainder of the term of this Agreement for services to be rendered both for administering the Escrow Fund and for paying agent duties and responsibilities for the Refunded Bonds. (b) Furthermore, the Bank may resign and be discharged from performing its duties and responsibilities under this Agreement upon notifying the City in writing of its intention to resign and requesting the City to appoint a successor. No such resignation shall take effect until a successor has been appointed by the City and such successor has accepted such appointment and agreed to perform all duties and obligations hereunder for a total compensation equal to the unearned proportional amount paid the Bank under Section 16 hereof for the administration of this Agreement and the unearned proportional amount of the paying agents fees due the Bank. 0202693 -11- Any successor to the Bank shall be a commercial bank, trust company or other financial institution authorized and empowered to perform the duties and obligations contemplated by this Agreement and organized and doing business under the laws of the United States or the State of Texas, having its principal office and place of business in the State of Texas, having a combined capital and surplus of at least $5,000,000 and be subject to the supervision or examination by Federal or State authority. Any successor or assigns to the Bank shall execute, acknowledge and deliver to the City and the Bank, or its successor or assigns, an instrument accepting such appointment hereunder, and the Bank shall execute and deliver an instrument transferring to such successor, subject to the terms of this Agreement, all the rights, powers and trusts created and established and to be performed under this Agreement. Upon the request of any such successor Bank, the City shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor Bank all such rights, powers and duties. The term "Bank" as used herein shall be the Bank and its legal assigns and successor hereunder. SECTION 28: The Bank shall not be responsible or liable to any person in any manner whatever for the sufficiency, correctness, genuineness, effectiveness, or validity of this Agreement with respect to the City, or for the identity or authority of any person making or executing this Agreement on behalf of the City. The Bank is authorized by the City to rely upon the representations of the City with respect to this Agreement and the deposits made pursuant hereto and as to the City's right and power to execute and deliver this Agreement, and the Bank shall not be liable in any manner as a result of such reliance. The duty of the Bank hereunder shall only be to the City and the holders of the Defeased Obligations. Neither the City nor the Bank shall assign or attempt to assign or transfer any interest hereunder or any portion of any such interest. Any such assignment or attempted assignment shall be in direct conflict with this Agreement and be without effect. SECTION 29: This Agreement shall be binding upon the City and the Bank and their respective successors and legal representatives and shall inure solely to the benefit of the holders of the Defeased Obligations, the City, the Bank and their respective successors and legal representatives. Furthermore, no alteration, amendment or modification of any provision of this Agreement (1) shall alter the firm financial arrangements made for the payment of the Defeased Obligations or (2) shall be effective unless (i) prior written consent of such alteration, amendment or modification shall have been obtained from the holders of all Defeased Obligations outstanding at the time of such alteration, amendment or modification and (ii) such alteration, amendment or modification is in writing and signed by the parties hereto; provided, however, the City and the Bank may, without the consent of either the holders of the Defeased Obligations, amend or modify 0202693 --12 - the terms and provisions of this Agreement to cure any ambiguity, formal defect or omission in this Agreement. If the parties hereto agree to any amendment or modification to this Agreement, prior written notice of such amendment or proposed modification, together with the legal documents amending or modifying this Agreement, shall be furnished to Moody's Investors Service, 99 Church Street, New York, New York 10007, Attention: Public Finance Rating Desk - Refunded Bonds, prior to such amendment or modification being executed. SECTION 30: This Agreement may be executed in several counterparts, all or any of which shall be regarded for all purposes as one original and shall constitute and be but one and the same instrument. This Agreement shall be governed by the laws of the State of Texas. 0202693 -13 - IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be executed by their duly authorized officers and their corporate seals to be hereunto affixed and attested as of the date first above written. CITY OF LUBBOCK, TEXAS Mayor ATTEST: City Secretary (City Seal) NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION as Escrow Agent Vice President ATTEST: Authorized Signer (Bank Seal) 0202693 -14 - Cill of Lubbock Cost to defease remaining Series 1988 CO Issue Securities Purchased 209,098,28 Cash. Deposit 353.75 209,452.03 Cost to defease allocated portion of Series 1993 Refunding Issue Securities Purchased 385,500.00 Casts Deposit - 385.50Q 90 Total cost before expenses 594,952,03 f q, 2i)0. 00 EsCMw Fee, L 0� g U9L alON xeJ _31-420d 0 FIRST SOUTNWESI COMPANY 10/07/1994 PAGE; 1 ---•--SCHEDULE OF PRESENT VALUE------ ATA CIISCOUNT RATE OF 6.781486000% START DATE 10/14/94 PRESENT CUMULATIVE DATE AMOUNTS P�V FACTOR VALUE PRESENT VALUE 1 2/15/95 54,022.50 .977533943 52,825.03 57,825.03 2 8/15/95 4,702,50 .945165467 4,"7.46 57,272.49 3 2/15/96 56,702.50 .914748689 51,868.54 109,141.03 4 8/15/96 3,500.00 .884749121 3,096.62 112,237.65 5 2/15/97 58,500.00 .855733400 50,060.40 162,293.05 6 8/15/97 2,193.75 .827669263 1,615.70 ,64,113.75 7 2115/98 56,193,75 .800525500 44,984.53 209,098.28 TOTALS 235,815.00 209,098-ZB a :_V . t FIRST SOUTHWEST COMPANY 10/07/1994 PAGE: 1 RECORD NAME LUBBOCK 74 ESCROW FOR 88 ESCROW CASH FL0II�CHEDlt& REOU;RED OPEN MARKET OATS OE6T�ICE SECURITIES INCOME ENDING 9ALANCE 10/14/1994 Initial Cash DePOsit 353.75 Z/15/1995 52,871.25 54,022.50 1,505.00 8/15/1995 5,846.25 4,702.50 361.25 2/15/1996 55,846.25 56,702.50 1,217.50 8/15/1996 3,877.50 3,500-00 840.00 2/15/1997 58,877.50 $8.500.00 462.50 8/15/1997 1,925.00 Z,193•75 73 L 25 2/15/1998 56,9Z5.00 56,193.75 TOTALS 236,168.75 235,915-00 / 4 i4 ' ' d ' Os .lS3I'lf-W-10r, IST 1,10 T .1 t t76, 40 J-)n FIRST SOUTHWEST COMPANY 10/07,1994 PAGE, 1 RECORD ,NAME LUBSGCh 94 ESCROW FOR U MATURITY PRINCIPAL ACCRUED DATE PRINCIPAL COUPON YIELD PRICE COST INTEREST tOTAL COST 2/15/1995 43,000.00 5.500 4.9000000 100.184R5 48,088_68 L'0.43 46,518.91 2/15/1996 52,000.00 4.625 6-5000000 97.87E.226 50,895.64 392.12 51,287.76 2/15/1997 55,000.00 4.750 6.5500000 95.52,09? 52,539.52 425.95 52,965.47 2/15/1996 54,000.00 8.125 !.1000000 ICZ.982950 55,610.79 715.35 56,326.14 Totals 209,000.00 207,134.43 1,963.115 209,098.28 Plus Cash Deposit 353.75 Total Eecrow Cost 209,452.03 0 FULBRIGHT & JAWORSKI L.L.P. TELEPHONE: 214/855-8000 A REGISTERED LIMITED LIABILITY PARTNERSHIP HOUSTON FACSIMILE: 214/855-8200 2''c00 i055 AVENUE ALISWASHINGTON, D.C. SUITE:2800 SAN ANTONIO DALLAS MARK S WESTERGARD ❑ALLAS, TEXAS 75201 NEW YORK PARTNER LOS ANGELES DIRECT DIAL: 294/855-8002 LONDON HONG KONG November 3, 1994 VIA FEDERAL EXPRESS Ms. Betty Johnson City of Lubbock 1625 13th Street Lubbock, Texas 79401 RE: City of Lubbock, Notice of Redemption Dear Betty: Enclosed are seven (7) copies of the Notice of Redemption. Please sign each copy and return all seven copies to me as soon as possible. Please call if you have any questions. Very truly yours, Mark . Westergard MSWJda Enclosure No V1994 RE��ci yE� 6. COY SEC#ji'7 Or 0191300 THISAIRMLE IwTHiiv THE E T AIli81 L LUSE 9 313 � 6 � {� USE THEINTRNATIONALANWAYBILLFCHSHIPMENTSTOPUERIDHIC0 DALLNDNUS.LOCATIONS PACKAGE TRACKING NUMBER QUESTIONS? CALL 800-238-5355 TOLL FREE. 4313064032 IstAl, 9 tim"CA "I'Milif waruM ' Date SENOW Is COPY I r�6w"I From [Your Name) Please PrW Yaw Number (Very tmportanlj To (Recipient's Name) Please Prin[ ;Recipient's Phone Number Every Impona �a ------------ Company OepaArrtertllFlaa No. Company + OepartmenUFbor Ni a =-, 1Y tar LUA!C CITY 5,tC iTANY urn Scree[ Address ,-- -� Exact � reet Address (IW C0nvGf DelTrrrgP.0, Aoxes orP. Bt 10IRsj InR5 1.1 !;T ttfo, 106 CRY --State Zip Required _ Clly _ - - - -- -- - -- State Zip Required r- Lk� k3c;Cit iX '!� 4 0 � ; � � 1 , � l is YOW MFTENNAL BRLMFG REFERENCE LNFORM47ION (optfonalj (First 24 characters wit appear on Invoke.) IF HOL D AT FEDEX LOCATION, Print FEDEX Address Here "ark 1 i r Street Address AYMENT 1 ❑pe sender 2❑ &I Rseplen'e FedEx Ace, No- 3❑ as 3rd Party FedEx Acct. No. A[] all cmdit Card I --I City State jIP Required r 5 ❑ Cask ___ _ Dap, Check AcUJCrddit Card No. _ _ _� �... Date ✓ SERVICES W(Check DELIVERYAND SPECIAL HANDLING FAWas WEYGi YalAyDutAD SERVICE CONDITIONS, DECLARED VALUE FudarrrlExpi, s ! (Check only one boxy services required) I c" ,s.,01, AND LIMIT OF LIABILITY E,�aCbargss - - t Urmu jr,r lanwrer+,xu sx+ ,+arnwrl :.1w,.,..rdo.urniDr,r +or+'❑NOLDAT W—Arl..y Lw,t, FFDfX LOCATION WEEKDAY useoft!useirou!arsv!utesyouragreumen!to!hesemm service mour current back of upon rvt�Wndit. tions WaWermationn 11 ❑ OTHER 51 ❑ OTHER Will Sectan Rt 2 ❑ Of1IVER WEEXOAY sertd�s copy of thtseairttil SSevailable may vary Ipr Gaernment overnight Ser lice. See U.S. Goirentment Sery Guxta tardela is. ._ Declared Vacua i PACKAGING 16 ❑ FEDEX LETTER' PACKAGING 56 ❑FEDEX LETTER" Snlulady 59NIcs - 3 ce We will rwl be responsible fa any claim In excess W S1D0 per package. whemer she resin d lass. (tarrwga, decay. non -delivery, -- 0"" 1 a L 12❑FEDIXPAK" 52❑FEDEXPAK" 31 ❑ki71QATffAk7(LQG4RQNSATUWAAY IFe In SeWan Rt — - --- mistlekvary, a misiniam>atuon, unless you declare a higghhe0r value, payanatlduoalcharga.antldocumMtyowactualoss7oratimehT claim. Limitations towel in the current Federal Express Semce Gtxde OUrar2 ' + i 13 ❑ FEW BOX 53 ❑ FEDEX BOX 3 ❑Wp�Mfi S4 y Total , Total Total apply. Yar nght b recover (ion Federal Express la any lass, Ifxre tltorpe! m MTWMY PhX-UP b11 ' j mclud, uNnnslc value of the package. loss d saks,ncomein!eresl, profit. etlMney's fees, costs, and other bane of dentaga whemher W ! 14 ❑ Irma TUBE M ❑ FEDEX TUBE 9 ❑ �d ") � — — -- 1 d+vac!,+ncudontol,consequential, orspeciulishmitetltogtagreaYerol Tu!alCl�argvs £a..urwrty Mwu flay FArwygraweetm,e.rb ry Vuwrrur,ent 6�arntUnf rA.r„m raa"awurewrx wxrl _._..________ - `-" M Sped id Iial[dfllrp -- UYAI.'IrldPhlENTµ:trw.ye�. w tVe,yruF Stao or the declared value epeolied, to the left Recovery canna exceed actual documented loss, The maxatwm Declared Value for 3D ❑ ECONOMY" 46 ❑ LFVR 4 ❑ AAN AMSGOODS (Fier.dwys> ElIbs FedEx Leiter and FedEx Pak packages is E50G. In tree evenr of untimely delivery, Federal Express will at you REVISION DATE 12192 PART v117214 FxLM Fca.mrlleeer sae mlavrgW c e"B' rere GOV`T 41 PACKAGE AAYICE abet. Y 6 ❑ FFmwm ti0ede lYMrafx. me ".0 I JF Y request and with some limitations refund all hansporialiat charges Patd Sae Service Guide for further information. FORMAT Ise 15 8 i __ _ rr,.. ^tit Swntie 1F. xef{Vu ww semi .>yblidiMb. 1t kalGe h��r.,i -- Sender authorizes Federal Express to deliver this sNpnseml witlaul octairnng a deliveryry signalu'e and shall mdemvfy a_nd had T0❑ OVERNIGHT nyp_�y 60❑ FAflGFIT "" .,w r sink ❑ l ! J iv _., _ awl+�l(kpu�x hermle. Federal Exp rss Iron any tlaims rewlh g Iheref on y� s„r,. wurrrFnou FREIGHT" fp,awmm,,rrxmat o.Jodwwti .nsf5da 12 ❑HOLMAYDEUVERYfadre,ed3 ' JBS Release Li a n., i�ur ,.,,.,, ".,,,, ••r,v m. n.b"... •Maroiv IE"xa dw"I ! r,nr tt Signature:.