HomeMy WebLinkAboutOrdinance - 2014-O0057 - Certificates Of Obligation Series 2014 - 04/10/2014Ordinance No. 2014- 00057
ORDINANCE
relating to
CITY OF LUBBOCK, TEXAS
TAX AND WATERWORKS SYSTEM SURPLUS REVENUE
CERTIFICATES OF OBLIGATION,
SERIES 2014
Adopted: April 10, 2014
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TABLE OF CONTENTS
Page
Recitals............................................................................................................................................1
ARTICLE I
DEFINITIONS AND OTHER PRELIMINARY MATTERS
Section1.01. Definitions...............................................................................................................2
Section1.02. Findings...................................................................................................................5
Section 1.03. Table of Contents, Titles, and Headings..................................................................5
Section1.04. Interpretation............................................................................................................5
ARTICLE II
SECURITY FOR THE CERTIFICATES; INTEREST AND SINKING FUND;
PRIOR LIEN OBLIGATIONS
Section 2.01. Payment of the Certificates......................................................................................6
Section 2.02. Interest and Sinking Fund........................................................................................7
ARTICLE III
AUTHORIZATION; GENERAL TERMS AND PROVISIONS
REGARDING THE CERTIFICATES
Section3.01.
Authorization...........................................................................................................7
Section 3.02.
Date, Denomination, Maturities, and Interest..........................................................8
Optional Redemption.............................................................................................15
Section 3.03.
Medium, Method, and Place of Payment.................................................................8
Mandatory Sinking Fund Redemption...................................................................15
Section 3.04.
Execution and Registration of Certificates..............................................................9
Partial Redemption................................................................................................15
Section3.05.
Ownership..............................................................................................................10
Notice of Redemption to Owners..........................................................................15
Section 3.06.
Registration, Transfer, and Exchange....................................................................
11
Section3.07.
Cancellation...........................................................................................................11
Effect of Redemption.............................................................................................16
Section 3.08.
Temporary Certificates..........................................................................................12
Lapse of Payment..................................................................................................17
Section 3.09.
Replacement Certificates.......................................................................................12
Section 3.10.
Book -Entry -Only System......................................................................................13
Section 3.11.
Successor Securities Depository; Transfer Outside Book -Entry -Only
System....................................................................................................................14
Section 3.12.
Payments to Cede & Co.........................................................................................14
ARTICLE IV
REDEMPTION OF CERTIFICATES BEFORE MATURITY
Section4.01.
Redemption............................................................................................................14
Section 4.02.
Optional Redemption.............................................................................................15
Section 4.03.
Mandatory Sinking Fund Redemption...................................................................15
Section 4.04.
Partial Redemption................................................................................................15
Section 4.05.
Notice of Redemption to Owners..........................................................................15
Section 4.06.
Payment Upon Redemption...................................................................................16
Section 4.07.
Effect of Redemption.............................................................................................16
Section 4.08.
Lapse of Payment..................................................................................................17
(i)
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ARTICLE V
PAYING AGENT/REGISTRAR
Section 5.01. Appointment of Paying Agent/Registrar...............................................................17
Section 5.02. Qualifications.........................................................................................................17
Section 5.03. Maintaining Paying Agent/Registrar.....................................................................17
Section5.04. Termination............................................................................................................17
Section 5.05. Notice of Change to Owners..................................................................................18
Section 5.06. Agreement to Perform Duties and Functions........................................................18
Section 5.07. Delivery of Records to Successor..........................................................................18
ARTICLE VI
FORM OF THE CERTIFICATES
Section6.01. Form Generally......................................................................................................18
Section 6.02. CUSIP Registration...............................................................................................19
Section6.03. Legal Opinion........................................................................................................19
Section 6.04. Statement of Insurance..........................................................................................19
ARTICLE VII
SALE AND DELIVERY OF CERTIFICATES; DEPOSIT OF PROCEEDS
Section 7.01. Sale of Certificates; Official Statement.................................................................19
Section 7.02. Control and Delivery of Certificates......................................................................21
Section 7.03. Deposit of Proceeds...............................................................................................21
ARTICLE VIII
INVESTMENTS
Section 8.01. Investments............................................................................................................21
Section 8.02. Investment Income.................................................................................................22
ARTICLE IX
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 9.01. Payment of the Certificates....................................................................................22
Section 9.02. Other Representations and Covenants...................................................................22
Section 9.03. Federal Income Tax Exclusion..............................................................................22
ARTICLE X
DEFAULT AND REMEDIES
Section 10.01. Events of Default...................................................................................................25
Section 10.02. Remedies for Default.............................................................................................25
Section 10.03. Remedies Not Exclusive........................................................................................25
ARTICLE XI
DISCHARGE
Section11.01. Discharge...............................................................................................................26
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ARTICLE XII
CONTINUING DISCLOSURE UNDERTAKING
Section12.01. Annual Reports......................................................................................................26
Section12.02. Event Notices.........................................................................................................26
Section 12.03. Identifying Information.........................................................................................28
Section 12.04. Limitations, Disclaimers and Amendments...........................................................28
ARTICLE XIII
AMENDMENTS; ATTORNEY GENERAL MODIFICATION
Section13.01. Amendments..........................................................................................................29
Section 13.02. Attorney General Modification..............................................................................29
ARTICLE XIV
EFFECTIVE IMMEDIATELY
Section 14.01. Effective Immediately . .......................................................................................... 29
Exhibit A - Description of Annual Disclosure of Financial Information ................................... A-1
ExhibitB - Sale Parameters.........................................................................................................B-1
Exhibit C - Form of the Certificates............................................................................................ C-1
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AN ORDINANCE PROVIDING FOR THE ISSUANCE OF CITY
OF LUBBOCK, TEXAS, TAX AND WATERWORKS SYSTEM
SURPLUS REVENUE CERTIFICATES OF OBLIGATION,
SERIES 2014; LEVYING A TAX AND PLEDGING SURPLUS
WATERWORKS SYSTEM REVENUES IN PAYMENT
THEREOF; PROVIDING FOR THE AWARD OF THE SALE
THEREOF IN ACCORDANCE WITH SPECIFIED
PARAMETERS; APPROVING THE OFFICIAL STATEMENT;
APPROVING EXECUTION OF A PURCHASE CONTRACT;
AND ENACTING OTHER PROVISIONS RELATING
THERETO
WHEREAS, under the provisions of Subchapter C, Chapter 271, Texas Local
Government Code, as amended, the City of Lubbock, Texas (the "City"), after giving proper
notice, is authorized to issue and sell for cash its certificates of obligation (herein defined as the
"Certificates") that are secured by and payable from the ad valorem taxes and other revenues
specified in Article II of this Ordinance, and that are issued in the amount, for the purposes, and
with the provisions set forth in Section 3.01 of this Ordinance;
WHEREAS, pursuant to a resolution heretofore passed by the City Council, notice of
intention to issue the Certificates was published in a newspaper of general circulation in the City
in accordance with applicable law;
WHEREAS, no petition signed by at least five percent of the qualified electors of the
City has been filed with the City Secretary protesting the issuance of the Certificates;
WHEREAS, the City Council is now authorized and empowered to proceed with the
issuance and sale of the Certificates, and hereby finds and determines that it is necessary and in
the best interests of the City and its citizens that it authorize the issuance of the Certificates in
accordance with the terms and provisions of this Ordinance at this time;
WHEREAS, the City is an "Issuer" within the meaning of Chapter 1371, Texas
Government Code ("Chapter 1371"), as amended, and the City Council desires to delegate,
pursuant to Chapter 1371 and the parameters of this Ordinance, to the Authorized Officer
(hereinafter defined), the authority to approve the principal amount, the interest rate, the price
and the other terms of the Certificates authorized hereby and to otherwise take such actions as
are necessary and appropriate to effect the sale of the Certificates;
WHEREAS, the meeting at which this Ordinance is considered is open to the public as
required by law, and public notice of the time, place, and purpose of said meeting was given as
required by Chapter 551, Texas Government Code, as amended; therefore,
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
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ARTICLE I
DEFINITIONS AND OTHER PRELIMINARY MATTERS
Section 1.01. Definitions.
Unless otherwise expressly provided or unless the context clearly requires otherwise in
this Ordinance, the following terms shall have the meanings specified below:
"Authorized Officer" means each of the City Manager and the Executive Director of
Finance, acting individually.
"Certificate" means any of the Certificates.
"Certificate Date" means the date designated as the initial date of the Certificates by
Section 3.02(a) of this Ordinance.
"Certificates" means the certificates of obligation authorized to be issued by Section 3.01
of this Ordinance.
"City" means the City of Lubbock, Texas.
"Closing Date" means the date of the initial delivery of and payment for the Certificates.
"Code" means the Internal Revenue Code of 1986, as amended by all legislation, if any,
enacted on or before the Issue Date.
"Computation Date" has the meaning stated in Section 1.148-1(b) of the Regulations.
"Code" means the Internal Revenue Code of 1986, as amended.
"Designated Payment/Transfer Office" means the Designated Payment/Transfer Office,
as designated in the Paying Agent/Registrar Agreement, or such other location designated by the
Paying Agent/Registrar.
"DTC" means The Depository Trust Company of New York, New York, or any
successor securities depository.
"DTC Participant" means brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations on whose behalf DTC was created to hold securities
to facilitate the clearance and settlement of securities transactions among DTC Participants.
"EMMA" means the Electronic Municipal Market Access System.
"Event of Default" means any event of default as defined in Section 10.01 of this
Ordinance.
"Fiscal Year" means such fiscal year as shall from time to time be set by the City
Council.
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"Gross Proceeds" has the meaning stated in Section 1.148-1(b) of the Regulations.
"Gross Revenues" means, with respect to any period, all income, revenues and receipts
received from the operation and ownership of the System.
"Initial Certificate" means the initial Certificate authorized by Section 3.04 of this
Ordinance.
"Interest and Sinking Fund" means the "Series 2014 Interest and Sinking Fund"
established in Section 2.02 hereof.
"Interest Payment Date" means the date or dates on which interest on the Certificates is
scheduled to be paid until their respective dates of maturity or prior redemption, as set forth in
the Pricing Certificate.
"Investment" has the meaning stated in Section 1.148-1(b) of the Regulations.
"MSRB" means the Municipal Securities Rulemaking Board.
"Net Revenues" means the Gross Revenues of the System, with respect to any period,
after deducting the System's Operating and Maintenance Expenses during such period.
"Net Sale Proceeds" has the meaning stated in Section 1.148-1(b) of the Regulations.
"Nonpurpose Investment" has the meaning stated in Section 1.148-1(b) of the
Regulations.
"Official Statement" means the document described in Section 7.01(c) prepared for
dissemination to potential investors in connection with the public offering and sale of the
Certificates.
"Operating and Maintenance Expenses" means all reasonable and necessary expenses
directly related and attributable to the operation and maintenance of the System, including, but
not limited to, the costs of insurance, the purchase and carrying of stores, materials, and supplies,
the payment of salaries and labor, and other expenditures reasonably and properly charged, under
generally accepted accounting principles, to the operation and maintenance of the System or by
statute deemed to be a first lien against the Gross Revenues. Depreciation charges on equipment,
machinery, plants and other facilities comprising the System and expenditures classed under
generally accepted accounting principles as capital expenditures shall not be considered as
"Operating and Maintenance Expenses" for purposes of determining "Net Revenues."
"Owner" means the person who is the registered owner of a Certificate or Certificates, as
shown in the Register.
"Paying Agent/Registrar" means the bank or trust company identified in the Paying
Agent/Registrar Agreement referred to in Section 5.01 of this Ordinance, or any successor
thereto as provided in this Ordinance.
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"Preliminary Official Statement" means the document described in Section 7.01(c)
prepared for dissemination to potential investors prior to the availability of the final Official
Statement.
"Pricing Certificate" means a certificate or certificates signed by an Authorized Officer
establishing the terms and features of each series of Certificates in accordance with Section 7.01
hereof.
"Prior Lien Obligations" means all bonds or other similar obligations of the City
presently outstanding or that may be hereafter issued, payable in whole or in part from and
secured by a first lien on and pledge of the Net Revenues of the System or by a lien on and
pledge of the Net Revenues subordinate to a first lien on and pledge of the Net Revenues but
superior to the lien on and pledge of the Surplus Revenues made for the Certificates.
"Proceeds" has the meaning stated in Section 1.148-1(b) of the Regulations.
"Project" means the purposes for which the Certificates are issued as set forth in
Section 3.01.
"Purchase Contract" means the purchase contract pursuant to which the Certificates are
sold to the Underwriters.
"Rebate Amount" has the meaning stated in Section 1.148-3 of the Regulations.
"Record Date" means the date specified in the Pricing Certificate.
"Register" means the Register specified in Section 3.06(a) of this Ordinance.
"Regulations" means the final or temporary Income Tax Regulations applicable to the
Certificates issued pursuant to Sections 141 through 150 of the Code. Any reference to a section
of the Regulations shall also refer to any successor provision to such section hereafter
promulgated by the Internal Revenue Service pursuant to Sections 141 through 150 of the Code
and applicable to the Certificates.
"Representation Letter" means the Blanket Letter of Representations between the City
and DTC.
"Representative" means the representative for the Underwriters named in the Purchase
Contract.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
"Series 2014 Bonds" means the City's General Obligation Refunding Bonds, Series
2014, authorized to be issued in accordance with the terms of an ordinance of the City adopted
concurrently with this Ordinance.
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"Special Payment Date" means the Special Payment Date prescribed by Section 3.03(b).
"Special Record Date" means the Special Record Date prescribed by Section 3.03(b).
"Surplus Revenues" means the Net Revenues of the System in an amount not to exceed
$1,000 remaining after payment of all debt service, reserve and other requirements in connection
with the City's Prior Lien Obligations.
"System" means the City's Waterworks System, being all properties, facilities and plants
currently owned, operated and maintained by the City for the supply, treatment, transmission and
distribution of treated, potable water, together with all future extensions, improvements,
replacements and additions thereto.
"Term Certificates" has the meaning set forth in Section 4.03 hereof.
"Unclaimed Payments" means money deposited with the Paying Agent/Registrar for the
payment of principal of or interest on the Certificates as the same come due and payable and
remaining unclaimed by the Owners of such Certificates after the applicable payment or
redemption date.
"Underwriters" means the underwriters named in the Purchase Contract.
"Yield of
(i) any Investment shall be computed in accordance with Section 1.148-5 of
the Regulations, and
(ii) the Bonds shall be computed in accordance with Section 1.148-4 of the
Regulations.
Section 1.02. Findings.
The declarations, determinations, and findings declared, made, and found in the preamble
to this Ordinance are hereby adopted, restated, and made a part of the operative provisions
hereof.
Section 1.03. Table of Contents, Titles, and Headings.
The table of contents, titles and headings of the Articles and Sections of this Ordinance
have been inserted for convenience of reference only and are not to be considered a part hereof
and shall not in any way modify or restrict any of the terms or provisions hereof and shall never
be considered or given any effect in construing this Ordinance or any provision hereof or in
ascertaining intent, if any question of intent should arise.
Section 1.04. Interpretation.
(a) Unless the context requires otherwise, words of the masculine gender shall be
construed to include correlative words of the feminine and neuter genders and vice versa, and
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words of the singular number shall be construed to include correlative words of the plural
number and vice versa.
(b) This Ordinance and all the terms and provisions hereof shall be liberally
construed to effectuate the purposes set forth herein.
(c) Should the Series 2014 Bonds not be sold pursuant to the ordinance authorizing
their issuance, references in this Ordinance thereto shall be deemed surplusage.
ARTICLE H
SECURITY FOR THE CERTIFICATES; INTEREST AND SINKING FUND;
PRIOR LIEN OBLIGATIONS
Section 2.01. Payment of the Certificates.
(a) Pursuant to the authority granted by the Texas Constitution and the laws of the
State of Texas, there shall be levied and there is hereby levied for the current year and for each
succeeding year thereafter while any of the Certificates or any interest thereon is outstanding and
unpaid, an ad valorem tax on each one hundred dollars valuation of taxable property within the
City, at a rate sufficient, within the limit prescribed by law, to pay the debt service requirements
of the Certificates, being (i) the interest on the Certificates, and (ii) a sinking fund for their
redemption at maturity or a sinking fund of two percent (2%) per annum (whichever amount is
the greater), when due and payable, full allowance being made for delinquencies and costs of
collection.
(b) The ad valorem tax thus levied shall be assessed and collected each year against
all property appearing on the tax rolls of the City most recently approved in accordance with law,
and the money thus collected shall be deposited as collected to the Interest and Sinking Fund.
(c) Said ad valorem tax, the collections therefrom, and all amounts on deposit in or
required hereby to be deposited to the Interest and Sinking Fund are hereby pledged and
committed irrevocably to the payment of the principal of and interest on the Certificates when
and as due and payable in accordance with their terms and this Ordinance.
(d) The City hereby covenants and agrees that the Surplus Revenues are hereby
irrevocably pledged equally and ratably to the payment of the principal of and interest on the
Certificates. The City reserves the right to issue Prior Lien Obligations for any lawful purpose,
at any time, in one or more installments.
(e) The amount of taxes to be assessed annually for the payment of debt service on
the Certificates shall be determined in the following manner:
(i) The City's annual budget shall reflect (A) the amount of debt service
requirements to become due on the Certificates in the next ensuing Fiscal Year and (B)
the amount on deposit and budgeted for deposit in the Interest and Sinking Fund on the
date such budget is approved.
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(ii) The amount required to be provided in the next succeeding Fiscal Year
from ad valorem taxes shall be the amount, if any, that the debt service requirements on
the Certificates to be paid during the next Fiscal Year exceeds the amount then on deposit
and budgeted for deposit in the Interest and Sinking Fund prior to the levy of such ad
valorem taxes.
(iii) Following approval of the City's annual budget, the City Council shall, by
ordinance, establish a tax rate that is sufficient to produce taxes in an amount which,
when added to the amount then on deposit or budgeted for deposit in the Interest and
Sinking Fund, will be sufficient to pay debt service on the Certificates when due during
the next Fiscal Year.
(f) If the liens and provisions of this Ordinance shall be released in a manner
permitted by Article XI hereof, then the collection of such ad valorem tax may be suspended or
appropriately reduced, as the facts may permit, and further deposits to the Interest and Sinking
Fund may be suspended or appropriately reduced, as the facts may permit. In determining the
aggregate principal amount of outstanding Certificates, there shall be subtracted the amount of
any Certificates that have been duly called for redemption and for which money has been
deposited with the Paying Agent/Registrar for such redemption.
Section 2.02. Interest and Sinking
(a) The City hereby establishes a special fund or account to be designated the "City
of Lubbock, Texas, Tax and Waterworks System Surplus Revenue Certificates of Obligation,
Series 2014, Interest and Sinking Fund" (the "Interest and Sinking Fund"), said fund to be
maintained at an official depository bank of the City separate and apart from all other funds and
accounts of the City.
(b) Money on deposit in or required by this Ordinance to be deposited to the Interest
and Sinking Fund shall be used solely for the purpose of paying the interest on and principal of
the Certificates when and as due and payable in accordance with their terms and this Ordinance.
ARTICLE III
AUTHORIZATION; GENERAL TERMS AND PROVISIONS
REGARDING THE CERTIFICATES
Section 3.01. Authorization.
The City's certificates of obligation to be designated "City of Lubbock, Texas, Tax and
Waterworks System Surplus Revenue Certificates of Obligation, Series 2014" (the
"Certificates"), or such other designation or designations as set forth in the Pricing Certificate,
are hereby authorized to be issued and delivered in accordance with the Constitution and laws of
the State of Texas, specifically Subchapter C, Chapter 271, Texas Local Government Code, as
amended, Chapter 1371, Texas Government Code, as amended ("Chapter 1371"), and
Article VIII of the City's Home -Rule Charter. The Certificates shall be issued in the aggregate
principal amount designated in the Pricing Certificate, such amount not to exceed $80,000,000,
for the purpose of paying contractual obligations to be incurred for the following purposes, to
wit: (i) improvements and extensions to City streets, including sidewalks, street lighting, traffic
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signals/controllers and traffic signal communication systems, signage, landscaping, utility
improvements, extensions, relocations and acquisition of land and rights-of-way in connection
therewith; (ii) relocation and upgrading of public utility infrastructure in the Central Business
District; (iii) park and recreation system improvements; (iv) upgrading of public safety radio
communication systems; (v) renovations and improvements to the Lubbock Preston Smith
International Airport facilities, including runway improvements; (vi) construction, improvement
and equipment of fire department facilities; (vii) animal shelter expansion; (viii) renovation,
improvement and expansion of Solid Waste Department facilities; (ix) improvements,
renovations, replacements, relocations and extensions to the City's Wastewater System,
including Southeast Water Reclamation Plant and office/warehouse replacement facility; (x)
improvements, renovations, replacements, relocations and extensions to the City's Waterworks
System (collectively, with items (i) -(ix), the "Project") and (xi) payment of professional services
of attorneys, financial advisors, engineers and other professionals in connection with the Project
and the issuance of the Certificates.
Section 3.02. Date, Denomination, Maturities, and Interest.
(a) The Certificates shall be dated the date set forth in the Pricing Certificate (the
"Certificate Date"). The Certificates shall be in fully registered form, without coupons, in the
denomination of $5,000 or any integral multiple thereof and shall be numbered separately from
one upward, except the Initial Certificate, which shall be numbered T-1 or in such other manner
provided in the Pricing Certificate.
(b) The Certificates shall mature on the date or dates, in the years and in the principal
amounts set forth in the Pricing Certificate provided that the maximum maturity for the
Certificates shall not exceed the number of years set forth in Exhibit B.
(c) Interest shall accrue and be paid on each Certificate respectively until its maturity
or prior redemption, from the later of the Certificate Date or the most recent Interest Payment
Date to which interest has been paid or provided for at the rates per annum for each respective
maturity specified in the Pricing Certificate. Such interest shall be payable on each Interest
Payment Date until maturity or prior redemption. Interest on the Certificates shall be calculated
on the basis of a three hundred sixty (360) day year composed of twelve (12) months of thirty
(30) days each, or on such other basis as set forth in the Pricing Certificate.
Section 3.03. Medium, Method, and Place of Payment.
(a) The principal of and interest on the Certificates shall be paid in lawful money of
the United States of America.
(b) Interest on the Certificates shall be payable to the Owners as shown in the
Register at the close of business on the Record Date; provided, however, in the event of
nonpayment of interest on a scheduled Interest Payment Date and for 30 days thereafter, a new
record date for such interest payment (a "Special Record Date") shall be established by the
Paying Agent/Registrar, if and when funds for the payment of such interest have been received
from the City. Notice of the Special Record Date and of the scheduled payment date of the past
due interest (the "Special Payment Date," which shall be fifteen (15) days after the Special
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Record Date) shall be sent at least five business days prior to the Special Record Date by first-
class United States mail, postage prepaid, to the address of each Owner of a Certificate appearing
on the Register at the close of business on the last business day next preceding the date of
mailing of such notice.
(c) Interest shall be paid by check, dated as of the Interest Payment Date, and sent
United States mail, first class postage prepaid, by the Paying Agent/Registrar to each Owner, at
the address thereof as it appears in the Register, or by such other customary banking arrangement
acceptable to the Paying Agent/Registrar and the Owner; provided, however, that the Owner
shall bear all risk and expense of such other banking arrangement. At the option of an Owner of
at least $1,000,000 principal amount of the Certificates, interest may be paid by wire transfer to
the bank account of such Owner on file with the Paying Agent/Registrar.
(d) The principal of each Certificate shall be paid to the Owner thereof on the due
date, whether at the maturity date or the date of prior redemption thereof, upon presentation and
surrender of such Certificate at the Designated Payment/Transfer Office of the Paying
Agent/Registrar.
(e) If the date for the payment of the principal of or interest on the Certificates shall
be a Saturday, Sunday, legal holiday, or day on which banking institutions in the city where the
Designated Payment/Transfer Office of the Paying Agent/Registrar is located are required or
authorized by law or executive order to close, then the date for such payment shall be the next
succeeding day that is not a Saturday, Sunday, legal holiday, or day on which banking
institutions are required or authorized to close, and payment on such date shall have the same
force and effect as if made on the original date payment was due and no additional interest shall
be due by reason of nonpayment on the date on which such payment is otherwise stated to be due
and payable.
(f) Unclaimed Payments shall be segregated in a special escrow account and held in
trust, uninvested by the Paying Agent/Registrar, for the account of the Owners of the Certificates
to which the Unclaimed Payments pertain. Subject to Title 6 of the Texas Property Code,
Unclaimed Payments remaining unclaimed by the Owners entitled thereto for three (3) years
after the applicable payment or redemption date shall be applied to the next payment on the
Certificates thereafter coming due; to the extent any such moneys remain three (3) years after the
retirement of all outstanding Certificates, such moneys shall be paid to the City to be used for
any lawful purpose. Thereafter, neither the City, the Paying Agent/Registrar, nor any other
person shall be liable or responsible to any Owners of such Certificates for any further payment
of such unclaimed moneys or on account of any such Certificates, subject to Title 6 of the Texas
Property Code.
Section 3.04. Execution and Registration of Certificates.
(a) The Certificates shall be executed on behalf of the City by the Mayor and the City
Secretary, by their manual or facsimile signatures, and the official seal of the City shall be
impressed or placed in facsimile thereon. Such facsimile signatures on the Certificates shall
have the same effect as if each of the Certificates had been signed manually and in person by
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each of said officers, and such facsimile seal on the Certificates shall have the same effect as if
the official seal of the City had been manually impressed upon each of the Certificates.
(b) In the event that any officer of the City whose manual or facsimile signature
appears on the Certificates ceases to be such officer before the authentication of such Certificates
or before the delivery thereof, such manual or facsimile signature nevertheless shall be valid and
sufficient for all purposes as if such officer had remained in such office.
(c) Except as provided below, no Certificate shall be valid or obligatory for any
purpose or be entitled to any security or benefit of this Ordinance unless and until there appears
thereon the Certificate of Paying Agent/Registrar substantially in the form provided herein, duly
authenticated by manual execution by an officer or duly authorized signatory of the Paying
Agent/Registrar. It shall not be required that the same officer or authorized signatory of the
Paying Agent/Registrar sign the Certificate of Paying Agent/Registrar on all of the Certificates.
In lieu of the executed Certificate of Paying Agent/Registrar described above, the Initial
Certificate delivered at the Closing Date shall have attached thereto the Comptroller's
Registration Certificate substantially in the form provided herein, manually executed by the
Comptroller of Public Accounts of the State of Texas, or by his duly authorized agent, which
Certificate shall be evidence that the Certificate has been duly approved by the Attorney General
of the State of Texas, that it is a valid and binding obligation of the City, and that it has been
registered by the Comptroller of Public Accounts of the State of Texas.
(d) On the Closing Date, one Initial Certificate reflecting the terms set forth in the
Pricing Certificate and representing the entire principal amount of all Certificates, payable in
stated installments to the Representative, or its designee, executed by the Mayor and City
Secretary of the City by their manual or facsimile signatures, approved by the Attorney General,
and registered and manually signed by the Comptroller of Public Accounts, will be delivered to
the Representative or its designee. Upon payment for the Initial Certificate, the Paying
Agent/Registrar shall cancel the Initial Certificate and deliver a single registered, definitive
Certificate for each maturity, in the aggregate principal amount thereof, to DTC on behalf of the
Underwriters.
Section 3.05. Ownership.
(a) The City, the Paying Agent/Registrar, and any other person may treat the person
in whose name any Certificate is registered as the absolute owner of such Certificate for the
purpose of making and receiving payment as herein provided (except interest shall be paid to the
person in whose name such Certificate is registered on the Record Date or Special Record Date,
as applicable), and for all other purposes, whether or not such Certificate is overdue, and neither
the City nor the Paying Agent/Registrar shall be bound by any notice or knowledge to the
contrary.
(b) All payments made to the Owner of a Certificate shall be valid and effectual and
shall discharge the liability of the City and the Paying Agent/Registrar upon such Certificate to
the extent of the sums paid.
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Section 3.06. Registration, Transfer, and Exchange.
(a) So long as any Certificates remain outstanding, the City shall cause the Paying
Agent/Registrar to keep at the Designated Payment/Transfer Office a register (the "Register") in
which, subject to such reasonable regulations as it may prescribe, the Paying Agent/Registrar
shall provide for the registration and transfer of Certificates in accordance with this Ordinance.
(b) The ownership of a Certificate may be transferred only upon the presentation and
surrender of the Certificate at the Designated Payment/Transfer Office of the Paying
Agent/Registrar with such endorsement or other evidence of transfer as is acceptable to the
Paying Agent/Registrar. No transfer of any Certificate shall be effective until entered in the
Register.
(c) The Certificates shall be exchangeable upon the presentation and surrender
thereof at the Designated Payment/Transfer Office of the Paying Agent/Registrar for a
Certificate or Certificates of the same maturity and interest rate and in a denomination or
denominations of any integral multiple of $5,000, and in an aggregate principal amount equal to
the unpaid principal amount of the Certificates presented for exchange. The Paying
Agent/Registrar is hereby authorized to authenticate and deliver Certificates exchanged for other
Certificates in accordance with this Section.
(d) Each exchange Certificate delivered by the Paying Agent/Registrar in accordance
with this Section shall constitute an original contractual obligation of the City and shall be
entitled to the benefits and security of this Ordinance to the same extent as the Certificate or
Certificates in lieu of which such exchange Certificate is delivered.
(e) No service charge shall be made to the Owner for the initial registration,
subsequent transfer, or exchange for a different denomination of any of the Certificates. The
Paying Agent/Registrar, however, may require the Owner to pay a sum sufficient to cover any
tax or other governmental charge that is authorized to be imposed in connection with the
registration, transfer, or exchange of a Certificate.
(f) Neither the City nor the Paying Agent/Registrar shall be required to issue,
transfer, or exchange any Certificate called for redemption, in whole or in part, where such
redemption is scheduled to occur within forty-five (45) calendar days after the transfer or
exchange date; provided, however, such limitation shall not be applicable to an exchange by the
Owner of the uncalled principal balance of a Certificate.
Section 3.07. Cancellation.
All Certificates paid or redeemed before scheduled maturity in accordance with this
Ordinance, and all Certificates in lieu of which exchange Certificates or replacement Certificates
are authenticated and delivered in accordance with this Ordinance, shall be cancelled and proper
records made regarding such payment, redemption, exchange, or replacement. The Paying
Agent/Registrar shall then return such cancelled Certificates to the City or may in accordance
with law destroy such cancelled Certificates and periodically furnish the City with certificates of
destruction of such Certificates.
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Section 3.08. Temporary Certificates.
(a) Following the delivery and registration of the Initial Certificate and pending the
preparation of definitive Certificates, the City may execute and, upon the City's request, the
Paying Agent/Registrar shall authenticate and deliver, one or more temporary Certificates that
are printed, lithographed, typewritten, mimeographed, or otherwise produced, in any
denomination, substantially of the tenor of the definitive Certificates in lieu of which they are
delivered, without coupons, and with such appropriate insertions, omissions, substitutions, and
other variations as the officers of the City executing such temporary Certificates may determine,
as evidenced by their signing of such temporary Certificates.
(b) Until exchanged for Certificates in definitive form, such Certificates in temporary
form shall be entitled to the benefit and security of this Ordinance.
(c) The City, without unreasonable delay, shall prepare, execute and deliver to the
Paying Agent/Registrar the Certificates in definitive form; thereupon, upon the presentation and
surrender of the Certificate or Certificates in temporary form to the Paying Agent/Registrar, the
Paying Agent/Registrar shall cancel the Certificates in temporary form and shall authenticate and
deliver in exchange therefor a Certificate or Certificates of the same maturity and series, in
definitive form, in the authorized denomination, and in the same aggregate principal amount, as
the Certificate or Certificates in temporary form surrendered. Such exchange shall be made
without the making of any charge therefor to any Owner.
Section 3.09. Replacement Certificates.
(a) Upon the presentation and surrender to the Paying Agent/Registrar of a mutilated
Certificate, the Paying Agent/Registrar shall authenticate and deliver in exchange therefor a
replacement Certificate of like tenor and principal amount, bearing a number not
contemporaneously outstanding. The City or the Paying Agent/Registrar may require the Owner
of such Certificate to pay a sum sufficient to cover any tax or other governmental charge that is
authorized to be imposed in connection therewith and any other expenses connected therewith.
(b) In the event that any Certificate is lost, apparently destroyed or wrongfully taken,
the Paying Agent/Registrar, pursuant to the applicable laws of the State of Texas and in the
absence of notice or knowledge that such Certificate has been acquired by a bona fide purchaser,
shall authenticate and deliver a replacement Certificate of like tenor and principal amount,
bearing a number not contemporaneously outstanding, provided that the Owner first:
(i) furnishes to the Paying Agent/Registrar satisfactory evidence of his or her
ownership of and the circumstances of the loss, destruction, or theft of such Certificate;
(ii) furnishes such security or indemnity as may be required by the Paying
Agent/Registrar to save it and the City harmless;
(iii) pays all expenses and charges in connection therewith, including, but not
limited to, printing costs, legal fees, fees of the Paying Agent/Registrar, and any tax or
other governmental charge that is authorized to be imposed; and
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(iv) satisfies any other reasonable requirements imposed by the City and the
Paying Agent/Registrar.
(c) If, after the delivery of such replacement Certificate, a bona fide purchaser of the
original Certificate in lieu of which such replacement Certificate was issued presents for
payment such original Certificate, the City and the Paying Agent/Registrar shall be entitled to
recover such replacement Certificate from the person to whom it was delivered or any person
taking therefrom, except a bona fide purchaser, and shall be entitled to recover upon the security
or indemnity provided therefor to the extent of any loss, damage, cost, or expense incurred by the
City or the Paying Agent/Registrar in connection therewith.
(d) In the event that any such mutilated, lost, apparently destroyed, or wrongfully
taken Certificate has become or is about to become due and payable, the Paying Agent/Registrar,
in its discretion, instead of issuing a replacement Certificate, may pay such Certificate when it
becomes due and payable.
(e) Each replacement Certificate delivered in accordance with this Section shall
constitute an original additional contractual obligation of the City and shall be entitled to the
benefits and security of this Ordinance to the same extent as the Certificate or Certificates in lieu
of which such replacement Certificate is delivered.
Section 3.10. Book -Entry -Only System.
(a) Notwithstanding any other provision hereof, upon initial issuance of the
Certificates, the Certificates shall be registered in the name of Cede & Co., as nominee of DTC.
The definitive Certificates shall be initially issued in the form of a single separate certificate for
each of the maturities thereof.
(b) With respect to Certificates registered in the name of Cede & Co., as nominee of
DTC, the City and the Paying Agent/Registrar shall have no responsibility or obligation to any
DTC Participant or to any person on behalf of whom such a DTC Participant holds an interest in
the Certificates. Without limiting the immediately preceding sentence, the City and the Paying
Agent/Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the
records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in
the Certificates, (ii) the delivery to any DTC Participant or any other person, other than an
Owner, as shown on the Register, of any notice with respect to the Certificates, including any
notice of redemption, or (iii) the payment to any DTC Participant or any other person, other than
an Owner, as shown in the Register of any amount with respect to principal of or interest on the
Certificates. Notwithstanding any other provision of this Ordinance to the contrary, the City and
the Paying Agent/Registrar shall be entitled to treat and consider the person in whose name each
Certificate is registered in the Register as the absolute owner of such Certificate for the purpose
of payment of principal of and interest on Certificates, for the purpose of giving notices of
redemption and other matters with respect to such Certificate, for the purpose of registering
transfer with respect to such Certificate, and for all other purposes whatsoever. The Paying
Agent/Registrar shall pay all principal of and interest on the Certificates only to or upon the
order of the respective Owners as shown in the Register, as provided in this Ordinance, or their
respective attorneys duly authorized in writing, and all such payments shall be valid and
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effective to fully satisfy and discharge the City's obligations with respect to payment of interest
on the Certificates to the extent of the sum or sums so paid. No person other than an Owner, as
shown in the Register, shall receive a certificate evidencing the obligation of the City to make
payments of amounts due pursuant to this Ordinance. Upon delivery by DTC to the Paying
Agent/Registrar of written notice to the effect that DTC has determined to substitute a new
nominee in place of Cede & Co., the word "Cede & Co." in this Ordinance shall refer to such
new nominee of DTC.
(c) The Representation Letter previously executed and delivered by the City, and
applicable to the City's obligations delivered in book -entry -only form to DTC as securities
depository, is hereby ratified and approved for the Certificates.
Section 3.11. Successor Securities Depository; Transfer Outside Book -Entry -Only
System.
In the event that the City determines that it is in the best interest of the City and the
beneficial owners of the Certificates that they be able to obtain certificated Certificates, or in the
event DTC discontinues the services described herein, the City shall (i) appoint a successor
securities depository, qualified to act as such under Section 17(a) of the Securities and Exchange
Act of 1934, as amended, notify DTC and DTC Participants of the appointment of such
successor securities depository and transfer one or more separate Certificates to such successor
securities depository; or (ii) notify DTC and DTC Participants of the availability through DTC of
certificated Certificates and cause the Paying Agent/Registrar to transfer one or more separate
registered Certificates to DTC Participants having Certificates credited to their DTC accounts.
In such event, the Certificates shall no longer be restricted to being registered in the Register in
the name of Cede & Co., as nominee of DTC, but may be registered in the name of the successor
securities depository, or its nominee, or in whatever name or names Owners transferring or
exchanging Certificates shall designate, in accordance with the provisions of this Ordinance.
Section 3.12. Payments to Cede & Co.
Notwithstanding any other provision of this Ordinance to the contrary, so long as the
Certificates are registered in the name of Cede & Co., as nominee of DTC, all payments with
respect to principal of and interest on such Certificates, and all notices with respect to such
Certificates shall be made and given, respectively, in the manner provided in the Representation
Letter of the City to DTC.
ARTICLE IV
REDEMPTION OF CERTIFICATES BEFORE MATURITY
Section 4.01. Redemption.
The Certificates are subject to redemption before their scheduled maturity only as
provided in this Article IV.
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Section 4.02. Optional Redemption.
(a) The City reserves the option to redeem Certificates in the manner provided in the
Form of Certificate attached hereto as Exhibit C, with such changes as are required by the
Pricing Certificate.
(b) If less than all of the Certificates are to be redeemed pursuant to an optional
redemption, the City shall determine the maturity or maturities and the amounts thereof to be
redeemed and shall direct the Paying Agent/Registrar to call by lot, or by any other customary
method that results in a random selection, the Certificates, or portions thereof, within such
maturity or maturities and in such principal amounts for redemption.
(c) The City, at least forty-five (45) days before the redemption date, unless a shorter
period shall be satisfactory to the Paying Agent/Registrar, shall notify the Paying
Agent/Registrar of such redemption date and of the principal amount of Certificates to be
redeemed.
Section 4.03. Mandatory Sinking Fund Redemption.
Certificates designated as "Term Certificates," if any, in the Pricing Certificate are
subject to scheduled mandatory redemption and will be redeemed by the City, out of moneys
available for such purpose in the Interest and Sinking Fund, in the manner provided in the Form
of Certificate attached hereto as Exhibit C, with such changes as are required by the Pricing
Certificate. Term Certificates shall be subject to mandatory redemption at the price, on the dates,
and in the respective principal amounts set forth in the Pricing Certificate.
Section 4.04. Partial Redemption.
(a) A portion of a single Certificate of a denomination greater than $5,000 may be
redeemed, but only in a principal amount equal to $5,000 or any integral multiple thereof. If
such a Certificate is to be partially redeemed, the Paying Agent/Registrar shall treat each $5,000
portion of the Certificate as though it were a single Certificate for purposes of selection for
redemption.
(b) Upon surrender of any Certificate for redemption in part, the Paying
Agent/Registrar, in accordance with Section 3.06 of this Ordinance, shall authenticate and
deliver an exchange Certificate or Certificates in an aggregate principal amount equal to the
unredeemed portion of the Certificate so surrendered, such exchange being without charge.
(c) The Paying Agent/Registrar shall promptly notify the City in writing of the
principal amount to be redeemed of any Certificate as to which only a portion thereof is to be
redeemed.
Section 4.05. Notice of Redemption to Owners.
(a) The Paying Agent/Registrar shall give notice of any redemption of Certificates by
sending notice by United States mail, first class postage prepaid, not less than thirty (30) days
before the date fixed for redemption, to the Owner of each Certificate (or part thereof) to be
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redeemed, at the address shown on the Register at the close of business on the business day next
preceding the date of mailing such notice.
(b) The notice shall state the redemption date, the redemption price, the place at
which the Certificates are to be surrendered for payment, and, if less than all the Certificates
outstanding are to be redeemed, an identification of the Certificates or portions thereof to be
redeemed.
(c) The City reserves the right to give notice of its election or direction to redeem
Certificates under Section 4.02 conditioned upon the occurrence of subsequent events. Such
notice may state (i) that the redemption is conditioned upon the deposit of moneys and/or
authorized securities, in an amount equal to the amount necessary to effect the redemption, with
the Paying Agent/Registrar, or such other entity as may be authorized by law, no later than the
redemption date or (ii) that the City retains the right to rescind such notice at any time prior to
the scheduled redemption date if the City delivers a certificate of the City to the Paying
Agent/Registrar instructing the Paying Agent/Registrar to rescind the redemption notice, and
such notice and redemption shall be of no effect if such moneys and/or authorized securities are
not so deposited or if the notice is rescinded. The Paying Agent/Registrar shall give prompt
notice of any such rescission of a conditional notice of redemption to the affected Owners. Any
Certificates subject to conditional redemption where redemption has been rescinded shall remain
Outstanding, and the rescission shall not constitute an event of default. Further, in the case of a
conditional redemption, the failure of the City to make moneys and/or authorized securities
available in part or in whole on or before the redemption date shall not constitute an event of
default.
(d) Any notice given as provided in this Section shall be conclusively presumed to
have been duly given, whether or not the Owner receives such notice.
Section 4.06. Payment Upon Redemption.
(a) Before or on each redemption date, the City shall deposit with the Paying
Agent/Registrar money sufficient to pay all amounts due on the redemption date and the Paying
Agent/Registrar shall make provision for the payment of the Certificates to be redeemed on such
date by setting aside and holding in trust such amounts as are received by the Paying
Agent/Registrar from the City and shall use such funds solely for the purpose of paying the
principal of and accrued interest on the Certificates being redeemed.
(b) Upon presentation and surrender of any Certificate called for redemption at the
Designated Payment/Transfer Office on or after the date fixed for redemption, the Paying
Agent/Registrar shall pay the principal of and accrued interest on such Certificate to the date of
redemption from the money set aside for such purpose.
Section 4.07. Effect of Redemption.
(a) Notice of redemption having been given as provided in Section 4.05 of this
Ordinance and subject to any conditions or rights reserved by the City under Section 4.05(c), the
Certificates or portions thereof called for redemption shall become due and payable on the date
fixed for redemption and, unless the City defaults in its obligation to make provision for the
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payment of the principal thereof or accrued interest thereon, such Certificates or portions thereof
shall cease to bear interest from and after the date fixed for redemption, whether or not such
Certificates are presented and surrendered for payment on such date.
(b) If the City shall fail to make provision for payment of all sums due on a
redemption date, then any Certificate or portion thereof called for redemption shall remain
outstanding and continue to bear interest at the rate stated on the Certificate until due provision is
made for the payment of same by the City.
Section 4.08. Lapse of Payment.
Money set aside for the redemption of Certificates and remaining unclaimed by the
Owners of such Certificates shall be subject to the provisions of Section 3.03(f) hereof.
ARTICLE V
PAYING AGENT/REGISTRAR
Section 5.01. Appointment of Pang Agent/Registrar.
The form of Paying Agent/Registrar Agreement presented at the meeting at which this
Ordinance was approved and the appointment of the Paying Agent/Registrar identified therein
are hereby approved.
The Mayor is hereby authorized and directed to execute the Paying Agent/Registrar
Agreement with the Paying Agent/Registrar, specifying the duties and responsibilities of the City
and the Paying Agent/Registrar, in substantially the form presented at the meeting at which this
Ordinance was approved with such changes as may be approved by the Mayor or an Authorized
Officer. The signature of the Mayor shall be attested by the City Secretary.
Section 5.02. Qualifications.
Each Paying Agent/Registrar shall be a commercial bank, a trust company organized
under the laws of the State of Texas, or other entity duly qualified and legally authorized to serve
as and perform the duties and services of paying agent and registrar for the Certificates.
Section 5.03. Maintaining Paying Agent/Registrar.
(a) At all times while any Certificates are outstanding, the City will maintain a
Paying Agent/Registrar that is qualified under Section 5.02 of this Ordinance.
(b) If the Paying Agent/Registrar resigns or otherwise ceases to serve as such, the
City will promptly appoint a replacement.
Section 5.04. Termination.
The City, upon not less than sixty (60) days notice, reserves the right to terminate the
appointment of any Paying Agent/Registrar by delivering to the entity whose appointment is to
be terminated written notice of such termination.
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Section 5.05. Notice of Change to Owners.
Promptly upon each change in the entity serving as Paying Agent/Registrar, the City will
cause notice of the change to be sent to each Owner by United States mail, first class postage
prepaid, at the address thereof in the Register, stating the effective date of the change and the
name and mailing address of the replacement Paying Agent/Registrar.
Section 5.06. Agreement to Perform Duties and Functions.
By accepting the appointment as Paying Agent/Registrar and executing the Paying
Agent/Registrar Agreement, the Paying Agent/Registrar is deemed to have agreed to the
provisions of this Ordinance and that it will perform the duties and functions of Paying
Agent/Registrar prescribed thereby.
Section 5.07. Delivery of Records to Successor.
If a Paying Agent/Registrar is replaced, such Paying Agent/Registrar, promptly upon the
appointment of the successor, will deliver the Register (or a copy thereof) and all other pertinent
books and records relating to the Certificates to the successor Paying Agent/Registrar.
ARTICLE VI
FORM OF THE CERTIFICATES
Section 6.01. Form Generally.
(a) The Certificates, including the Registration Certificate of the Comptroller of
Public Accounts of the State of Texas, the Certificate of the Paying Agent/Registrar, and the
Assignment form to appear on each of the Certificates, (i) shall be generally in the form set forth
in Exhibit C hereto, with such appropriate insertions, omissions, substitutions, and other
variations as are permitted or required by this Ordinance and the Pricing Certificate, and (ii) may
have such letters, numbers, or other marks of identification (including identifying numbers and
letters of the Committee on Uniform Securities Identification Procedures of the American
Bankers Association) and such legends and endorsements (including any reproduction of an
opinion of counsel) thereon as, consistently herewith, may be determined by the City or by the
officers executing such Certificates, as evidenced by their execution thereof.
(b) Any portion of the text of any Certificates may be set forth on the reverse side
thereof, with an appropriate reference thereto on the face of the Certificates.
(c) The definitive Certificates, if any, shall be typewritten, photocopied, printed,
lithographed, or engraved, and may be produced by any combination of these methods or
produced in any other similar manner, all as determined by the officers executing such
Certificates, as evidenced by their execution thereof.
(d) The Initial Certificate submitted to the Attorney General of the State of Texas
may be typewritten and photocopied or otherwise reproduced.
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Section 6.02. CUSIP Registration.
The City may secure identification numbers through CUSIP Global Services, managed on
behalf of the American Bankers Association by Standard & Poor's Financial Services LLC, and
may authorize the printing of such numbers on the face of the Certificates. It is expressly
provided, however, that the presence or absence of CUSIP numbers on the Certificates shall be
of no significance or effect in regard to the legality thereof and neither the City nor the attorneys
approving said Certificates as to legality are to be held responsible for CUSIP numbers
incorrectly printed on the Certificates.
Section 6.03. Legal Opinion.
The approving legal opinion of Andrews Kurth LLP, Bond Counsel, may be attached to
or printed on the reverse side of each Certificate over the certification of the City Secretary of the
City, which may be executed in facsimile.
Section 6.04. Statement of Insurance.
A statement relating to a municipal bond insurance policy, if any, to be issued for the
Certificates may be printed on or attached to each Certificate.
ARTICLE VII
SALE AND DELIVERY OF CERTIFICATES; DEPOSIT OF PROCEEDS
Section 7.01. Sale of Certificates: Official Statement.
(a) The Certificates shall be sold at negotiated sale to the Underwriters in accordance
with the terms of this Ordinance, including this Section 7.01(a) and Exhibit B hereto, provided
that all of the conditions set forth in Exhibit B can be satisfied. As authorized by Chapter 1371,
the Authorized Officer is authorized to act on behalf of the City, upon determining that the
conditions set forth in Exhibit B can be satisfied, in selling and delivering the Certificates and
carrying out the other procedures specified in this Ordinance, including determining (i) the total
aggregate principal amount and the number of series of the Certificates, (ii) whether to acquire
bond insurance for the Certificates, (iii) the price at which the Certificates will be sold, (iv) the
number and any additional or different title or designation for the Certificates to be issued, (v)
the form in which the Certificates shall be issued, (vi) the dates on which the Certificates will
mature, the principal amount to mature in each year, the rate of interest to be borne by each such
maturity, the interest payment dates, and the initial date from which interest will accrue, (vii) the
dates, prices and other terms upon and at which the Certificates shall be subject to redemption
prior to maturity (including terms for optional and mandatory sinking fund redemption), and
(viii) all other matters relating to the issuance, sale and delivery of the Certificates, all of which
shall be specified in the Pricing Certificate.
The authority granted to the Authorized Officer under this Section 7.01(a) shall expire at
10:00 p.m., on the 180th day following the date of this Ordinance (the "Expiration Date"), unless
otherwise extended by the City Council by separate action. Certificates sold pursuant to a
Purchase Contract executed on or before the Expiration Date may be delivered after such date.
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Any finding or determination made by the Authorized Officer relating to the issuance and
sale of the Certificates and the execution of the Purchase Contract in connection therewith shall
have the same force and effect as a finding or determination made by the City Council.
(b) The Authorized Officer is hereby authorized and directed to execute and deliver,
and the City Secretary is hereby authorized and directed to attest, a certificate purchase contract
(the "Purchase Contract") which shall be in the form approved by the Authorized Officer. Upon
completion of the terms of the Purchase Contract in accordance with the terms of the Pricing
Certificate and this Ordinance, the Authorized Officer is authorized and directed to execute such
Purchase Contract on behalf of the City and the Authorized Officer and all other officers, agents
and representatives of the City are hereby authorized to do any and all things necessary or
desirable to satisfy the conditions set out therein and to provide for the issuance and delivery of
the Certificates. The Certificates shall initially be registered in the name of the Representative.
At the direction of the Authorized Officer, the Certificates and the Series 2014 Bonds may be
sold, but are not required to be sold, pursuant to the terms of a common Purchase Contract.
(c) The form and substance of the Preliminary Official Statement and any addenda,
supplement or amendment thereto, with such appropriate variations as shall be approved by the
Authorized Officer, are hereby in all respects approved and adopted, and the Preliminary Official
Statement is hereby deemed final as of its date within the meaning and for the purposes of
paragraph (b)(1) of Rule 15c2-12 under the Securities Exchange Act of 1934, as amended. The
Authorized Officer and City Secretary are hereby authorized and directed to cause to be prepared
a final Official Statement (the "Official Statement") incorporating applicable pricing information
pertaining to the Certificates, and to execute the same by manual or facsimile signature and
deliver appropriate numbers of executed copies thereof to the Underwriters. The Official
Statement as thus approved, executed and delivered, with such appropriate variations as shall be
approved by the Authorized Officer and the Underwriters, may be used by the Underwriters in
the public offering and sale of the Certificates. The City Secretary is hereby authorized and
directed to include and maintain a copy of the Official Statement and any addenda, supplement
or amendment thereto thus approved among the permanent records of the meeting at which this
Ordinance was adopted. The use and distribution of the Preliminary Official Statement, and the
preliminary public offering of the Certificates by the Underwriters, is hereby ratified, approved
and confirmed. The Authorized Officer may direct the preparation of a common Official
Statement for the Certificates and the Series 2014 Bonds.
(d) All officers of the City are authorized to execute such documents, certificates,
receipts and other instruments as they may deem appropriate in order to consummate the delivery
of the Certificates in accordance with the terms of sale therefor including, without limitation, the
Purchase Contract.
(e) The obligation of the Underwriters to accept delivery of the Certificates is subject
to the closing conditions set forth in the Purchase Contract being satisfied, including specifically
the Underwriters being furnished with the final, approving opinion of Andrews Kurth LLP, bond
counsel for the City, which opinion shall be dated as of and delivered on the Closing Date.
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Section 7.02. Control and Delivery of Certificates.
(a) The Authorized Officer of the City is hereby authorized to have control of the
Initial Certificate and all necessary records and proceedings pertaining thereto pending
investigation, examination, and approval of the Attorney General of the State of Texas,
registration by the Comptroller of Public Accounts of the State of Texas and registration with,
and initial exchange or transfer by, the Paying Agent/Registrar.
(b) After registration by the Comptroller of Public Accounts, delivery of the
Certificates shall be made to the Underwriters under and subject to the general supervision and
direction of the Authorized Officer, against receipt by the City of all amounts due to the City
under the terms of sale.
(c) In the event the Mayor or City Secretary is absent or otherwise unable to execute
any document or take any action authorized herein, the Mayor Pro Tem and the Assistant City
Secretary, respectively, shall be authorized to execute such documents and take such actions, and
the performance of such duties by the Mayor Pro Tem and the Assistant City Secretary shall for
the purposes of this Ordinance have the same force and effect as if such duties were performed
by the Mayor and City Secretary, respectively.
Section 7.03. Deposit of Proceeds.
Proceeds from the sale of the Certificates shall be applied in accordance with the
provisions set forth in the Pricing Certificate, which may provide for the creation of any special
accounts deemed necessary or appropriate by the Authorized Officer.
ARTICLE VIII
INVESTMENTS
Section 8.01. Investments.
(a) Money in the Interest and Sinking Fund created by this Ordinance and any special
accounts provided for in the Pricing Certificate pursuant to Section 7.03, at the City's option,
may be invested in such securities or obligations as permitted under applicable law. The
Authorized Officer, and any other officer of the City authorized to make investments on behalf
of the City, are hereby authorized and directed to execute and deliver, on behalf of the City, any
and all investment agreements, guaranteed investment contracts or repurchase agreements in
connection with the investment of moneys on deposit in the Interest and Sinking Fund and the
special account provided for in the Pricing Certificate pursuant to Section 7.03, but only to the
extent such investment agreements, guaranteed investment contracts or repurchase agreements
are authorized investments under applicable law.
(b) Any securities or obligations in which money in the Interest and Sinking Fund is
so invested shall be kept and held in trust for the benefit of the Owners and shall be sold and the
proceeds of sale shall be timely applied to the making of all payments required to be made from
the fund from which the investment was made.
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Section 8.02. Investment Income.
(a) Interest and income derived from investment of the Interest and Sinking Fund
shall be credited to such fund.
(b) Interest and income derived from investment of the other funds to be deposited
pursuant to Section 7.03 hereof shall be credited to the fund or account where deposited until the
acquisition or construction of said projects is completed or shall be transferred to the Interest and
Sinking Fund as shall be determined by the City Council. Upon completion of the authorized
projects, to the extent such interest and income are present, such interest and income shall be
deposited to the Interest and Sinking Fund.
ARTICLE IX
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 9.01. Payment of the Certificates.
On or before each Interest Payment Date for the Certificates and while any of the
Certificates are outstanding and unpaid, there shall be made available to the Paying
Agent/Registrar, out of the Interest and Sinking Fund, money sufficient to pay such interest on
and principal of the Certificates as will accrue or mature on the applicable Interest Payment Date,
maturity date or date of prior redemption.
Section 9.02. Other Representations and Covenants.
(a) The City will faithfully perform at all times any and all covenants, undertakings,
stipulations, and provisions contained in this Ordinance and in each Certificate; the City will
promptly pay or cause to be paid the principal of and interest on each Certificate on the dates and
at the places and manner prescribed in such Certificate; and the City will, at the times and in the
manner prescribed by this Ordinance, deposit or cause to be deposited the amounts of money
specified by this Ordinance.
(b) The City is duly authorized under the laws of the State of Texas to issue the
Certificates; all action on its part for the creation and issuance of the Certificates has been duly
and effectively taken; and the Certificates in the hands of the Owners thereof are and will be
valid and enforceable obligations of the City in accordance with their terms.
Section 9.03. Federal Income Tax Exclusion.
(a) Not to Cause Interest to Become Taxable. The City shall not use, permit the use
of or omit to use Gross Proceeds or any other amounts (or any property the acquisition,
construction or improvement of which is to be financed directly or indirectly with Gross
Proceeds) in a manner which, if made or omitted, respectively, would cause the interest on any
Certificate to become includable in the gross income, as defined in Section 61 of the Code, of the
owner thereof for federal income tax purposes. Without limiting the generality of the foregoing,
unless and until the City shall have received a written opinion of counsel nationally recognized
in the field of municipal bond law to the effect that failure to comply with such covenant will not
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adversely affect the exemption from federal income tax of the interest on any Certificate, the
City shall comply with each of the specific covenants in this Section.
(b) No Private Use or Private Payments. Except as permitted by Section 141 of the
Code and the Regulations and rulings thereunder, the City shall, at all times after the Issue Date
of any Certificate and prior to the last stated maturity of the Certificates
(i) exclusively own, operate, and possess all property the acquisition,
construction, or improvement of which is to be financed directly or indirectly with Gross
Proceeds of such Certificate and not use or permit the use of such Gross Proceeds or any
property acquired, constructed, or improved with such Gross Proceeds in any activity
carried on by any person or entity other than a state or local government, unless such use
is solely as a member of the general public, or
(ii) not directly or indirectly impose or accept any charge or other payment for
use of Gross Proceeds of such Certificate or any property the acquisition, construction or
improvement of which is to be financed directly or indirectly with such Gross Proceeds
other than taxes of general application and interest earned on investments acquired with
such Gross Proceeds pending application for their intended purposes.
(c) No Private Loan. Except to the extent permitted by Section 141 of the Code and
the Regulations and rulings thereunder, the City shall not use Gross Proceeds of such Certificate
to make or finance loans to any person or entity other than a state or local government. For
purposes of the foregoing covenant, Gross Proceeds are considered to be "loaned" to a person or
entity if (1) property acquired, constructed or improved with Gross Proceeds is sold or leased to
such person or entity in a transaction which creates a debt for federal income tax purposes, (2)
capacity in or service from such property is committed to such person or entity under a take -or -
pay, output, or similar contract or arrangement, or (3) indirect benefits, or burdens and benefits
of ownership, of such Gross Proceeds or such property are otherwise transferred in a transaction
which is the economic equivalent of a loan.
(d) Not to Invest at Higher Yield. Except to the extent permitted by Section 148 of
the Code and the Regulations and rulings thereunder, the City shall not, at any time prior to the
earlier of the final stated maturity or final payment of such Certificate, directly or indirectly
invest Gross Proceeds of such Certificate in any Investment (or use such Gross Proceeds to
replace money so invested), if as a result of such investment the Yield of all Investments
allocated to such Gross Proceeds whether then held or previously disposed of, exceeds the Yield
on the Certificates.
(e) Not Federally Guaranteed. Except to the extent permitted by Section 149(b) of
the Code and the Regulations and rulings thereunder, the City shall not take or omit to take any
action which would cause the Certificates to be federally guaranteed within the meaning of
Section 149(b) of the Code and the Regulations and rulings thereunder.
(f) Information Report. The City shall timely file with the Secretary of the Treasury
the information required by Section 149(e) of the Code with respect to the Certificates on such
forms and in such place as such Secretary may prescribe.
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(g) Payment of Rebate Amount. Except to the extent otherwise provided in Section
148(f) of the Code and the Regulations and rulings thereunder, the City shall:
(i) account for all Gross Proceeds (including all receipts, expenditures and
investments thereof) on its books of account separately and apart from all other funds
(and receipts, expenditures and investments thereof) and shall retain all records of such
accounting for at least six years after the final Computation Date. The City may,
however, to the extent permitted by law, commingle Gross Proceeds of the Certificates
with other money of the City, provided that the City separately accounts for each receipt
and expenditure of such Gross Proceeds and the obligations acquired therewith,
(ii) calculate the Rebate Amount with respect to the Certificates not less
frequently than each Computation Date, in accordance with rules set forth in Section
148(f) of the Code, Section 1.148-3 of the Regulations, and the rulings thereunder. The
City shall maintain a copy of such calculations for at least six years after the final
Computation Date,
(iii) as additional consideration for the purchase of the Certificates by the
initial purchaser thereof and the loan of the money represented thereby, and in order to
induce such purchase by measures designed to ensure the excludability of the interest
thereon from the gross income of the owners thereof for federal income tax purposes, pay
to the United States the amount described in paragraph (ii) above at the times, in the
installments, to the place, in the manner and accompanied by such forms or other
information as is or may be required by Section 148(f) of the Code and the Regulations
and rulings thereunder, and
(iv) exercise reasonable diligence to assure that no errors are made in the
calculations required by paragraph (ii) and, if such error is made, to discover and
promptly to correct such error within a reasonable amount of time thereafter, including
payment to the United States of any interest and any penalty required by the Regulations.
(h) Not to Divert Arbitrage Profits. Except to the extent permitted by Section 148 of
the Code and the Regulations and rulings thereunder, the City shall not enter into any transaction
that reduces the amount required to be paid to the United States pursuant to Subsection (h) of this
Section because such transaction results in a smaller profit or a larger loss than would have
resulted if the transaction had been at arm's length and had the Yield of the Certificates, not been
relevant to either party.
(i) Not Hedge Bonds. The City will not invest more than 50 percent of the Proceeds
of the Certificates in Nonpurpose Investments having a guaranteed yield for four years or more.
On the Issue Date of the Certificates, the City reasonably expects that at least 85 percent of the
Net Sale Proceeds of the Certificates will be used to carry out the governmental purpose of such
series within three years after the Issue Date.
0) Airport Facilities. The City will not spend more than 10 percent of the Proceeds
of the Certificates for the purposes described in clause (v) of Section 3.01 of this Ordinance if the
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resulting expenditures would cause the Certificates to be treated as "private activity bonds"
under the Code.
ARTICLE X
DEFAULT AND REMEDIES
Section 10.01. Events of Default.
Each of the following occurrences or events for the purpose of this Ordinance is hereby
declared to be an Event of Default:
(i) the failure to make payment of the principal of or interest on any of the
Certificates when the same becomes due and payable; or
(ii) default in the performance or observance of any other covenant,
agreement, or obligation of the City, which default materially and adversely affects the
rights of the Owners, including but not limited to their prospect or ability to be repaid in
accordance with this Ordinance, and the continuation thereof for a period of sixty (60)
days after notice of such default is given by any Owner to the City.
Section 10.02. Remedies for Default.
(a) Upon the happening of any Event of Default, then any Owner or an authorized
representative thereof, including but not limited to a trustee or trustees therefor, may proceed
against the City for the purpose of protecting and enforcing the rights of the Owners under this
Ordinance by mandamus or other suit, action or special proceeding in equity or at law in any
court of competent jurisdiction for any relief permitted by law, including the specific
performance of any covenant or agreement contained herein, or thereby to enjoin any act or thing
that may be unlawful or in violation of any right of the Owners hereunder or any combination of
such remedies.
(b) It is provided that all such proceedings shall be instituted and maintained for the
equal benefit of all Owners of Certificates then outstanding.
Section 10.03. Remedies Not Exclusive.
(a) No remedy herein conferred or reserved is intended to be exclusive of any other
available remedy, but each and every such remedy shall be cumulative and shall be in addition to
every other remedy given hereunder or under the Certificates or now or hereafter existing at law
or in equity; provided, however, that notwithstanding any other provision of this Ordinance, the
right to accelerate the debt evidenced by the Certificates shall not be available as a remedy under
this Ordinance.
(b) The exercise of any remedy herein conferred or reserved shall not be deemed a
waiver of any other available remedy.
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ARTICLE XI
DISCHARGE
Section 11.01. Discharge.
The Certificates may be defeased, discharged or refunded in any manner permitted by
applicable law.
ARTICLE XII
CONTINUING DISCLOSURE UNDERTAKING
Section 12.01. Annual Reports.
(a) The City shall provide annually to the MSRB, within six (6) months after the end
of each fiscal year, financial information and operating data with respect to the City of the
general type included in the final Official Statement, being the information described in Exhibit
A hereto. Any financial statements so to be provided shall be (i) prepared in accordance with the
accounting principles described in Exhibit A hereto, and (ii) audited, if the City commissions an
audit of such statements and the audit is completed within the period during which they must be
provided and (iii) submitted through EMMA, in an electronic format with accompany identifying
information, as prescribed by the MSRB. If the audit of such financial statements is not complete
within such period, then the City shall provide notice that audited financial statements are not
available and shall provide unaudited financial statements for the applicable fiscal year to the
MSRB. The City shall provide audited financial statements for the applicable fiscal year to the
MSRB, when and if audited financial statements become available.
(b) If the City changes its fiscal year, it will notify the MSRB of the change (and of
the date of the new fiscal year end) prior to the next date by which the City otherwise would be
required to provide financial information and operating data pursuant to this Section.
(c) The financial information and operating data to be provided pursuant to this
Section may be set forth in full in one or more documents or may be included by specific
referenced to any document (including an official statement or other offering document, if it is
available from the MSRB) that theretofore has been provided to the MSRB or filed with the SEC.
Section 12.02. Event Notices.
(a) The City shall notify the MSRB, in a timely manner (not in excess of ten (10)
business days after the occurrence of an event), of any of the following events with respect to the
Certificates:
(i) principal and interest payment delinquencies;
(ii) nonpayment related defaults, if material;
(iii) unscheduled draws on debt service reserves reflecting financial
difficulties;
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(iv) unscheduled draws on credit enhancements reflecting financial
difficulties;
(v) substitution of credit or liquidity providers, or their failure to perform;
(vi) adverse tax opinions, the issuance by the Internal Revenue Service of
proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form
5701-TEB) or other material notices or determinations with respect to the tax status of the
Certificates, or other material events affecting the tax status of the Certificates;
(vii) modifications to rights of Owners, if material;
(viii) redemption calls, if material, and tender offers;
(ix) defeasances;
(x) release, substitution, or sale of property securing repayment of the
Certificates, if material;
(xi) rating changes;
(xii) bankruptcy, insolvency, receivership or similar event of the City;
(xiii) the consummation of a merger, consolidation, or acquisition involving the
City or the sale of all or substantially all of the assets of the City, other than in the
ordinary course of business, the entry into a definitive agreement to undertake such an
action or the termination of a definitive agreement relating to any such actions, other than
pursuant to its terms, if material; and
(xiv) appointment of a successor Paying Agent/Registrar or change in the name
of the Paying Agent/Registrar, if material.
(b) As used in clause (xii) above, the phrase "bankruptcy, insolvency, receivership or
similar event" means the appointment of a receiver, fiscal agent or similar officer for the City in
a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal
law in which a court of governmental authority has assumed jurisdiction over substantially all of
the assets or business of the City, or if jurisdiction has been assumed by leaving the City Council
and official or officers of the City in possession but subject to the supervision and orders of a
court or governmental authority, or the entry of an order confirming a plan of reorganization,
arrangement or liquidation by a court or governmental authority having supervision or
jurisdiction over substantially all of the assets or business of the City.
(c) The City shall notify the MSRB, in a timely manner, of any failure by the City to
provide financial information or operating data in accordance with Section 12.01 of this
Ordinance by the time required by such Section.
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Section 12.03. Identifying Information.
All documents provided to the MSRB pursuant to this Article shall be accompanied by
identifying information as prescribed by the MSRB.
Section 12.04. Limitations, Disclaimers and Amendments.
(a) The City shall be obligated to observe and perform the covenants specified in this
Article for so long as, but only for so long as, the City remains an "obligated person" with respect
to the Certificates within the meaning of the Rule, except that the City in any event will give
notice of any Certificate calls and any defeasances that cause the City to be no longer an
"obligated person."
(b) The provisions of this Article are for the sole benefit of the Owners and beneficial
owners of the Certificates, and nothing in this Article, express or implied, shall give any benefit
or any legal or equitable right, remedy, or claim hereunder to any other person. The City
undertakes to provide only the financial information, operating data, financial statements, and
notices which it has expressly agreed to provide pursuant to this Article and does not hereby
undertake to provide any other information that may be relevant or material to a complete
presentation of the City's financial results, condition, or prospects or hereby undertake to update
any information provided in accordance with this Article or otherwise, except as expressly
provided herein. The City does not make any representation or warranty concerning such
information or its usefulness to a decision to invest in or sell Certificates at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE OWNER
OR BENEFICIAL OWNER OF ANY CERTIFICATE OR ANY OTHER PERSON, IN
CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM
ANY BREACH BY THE CITY, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS
PART, OF ANY COVENANT SPECIFIED IN THIS ARTICLE, BUT EVERY RIGHT AND
REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT
OF ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR
SPECIFIC PERFORMANCE.
(c) No default by the City in observing or performing its obligations under this
Article shall constitute a breach of or default under the Ordinance for purposes of any other
provisions of this Ordinance.
(d) Nothing in this Article is intended or shall act to disclaim, waive, or otherwise
limit the duties of the City under federal and state securities laws.
(e) The provisions of this Article may be amended by the City from time to time to
adapt to changed circumstances that arise from a change in legal requirements, a change in law,
or a change in the identity, nature, status, or type of operations of the City, but only if (i) the
provisions of this Article, as so amended, would have permitted an underwriter to purchase or
sell Certificates in the primary offering of the Certificates in compliance with the Rule, taking
into account any amendments or interpretations of the Rule to the date of such amendment, as
well as such changed circumstances, and (ii) either (A) the Owners of a majority in aggregate
principal amount (or any greater amount required by any other provisions of this Ordinance that
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HOU:3414317.1
authorizes such an amendment) of the outstanding Certificates consent to such amendment or (B)
an entity or individual person that is unaffiliated with the City (such as nationally recognized
bond counsel) determines that such amendment will not materially impair the interests of the
Owners and beneficial owners of the Certificates. If the City so amends the provisions of this
Article, it shall include with any amended financial information or operating data next provided
in accordance with Section 12.01 an explanation, in narrative form, of the reasons for the
amendment and of the impact of any change in type of financial information or operating data so
provided.
ARTICLE XIII
AMENDMENTS; ATTORNEY GENERAL MODIFICATION
Section 13.01. Amendments.
This Ordinance shall constitute a contract with the Owners, be binding on the City, and
shall not be amended or repealed by the City so long as any Certificate remains outstanding
except as permitted in this Section. The City may, without consent of or notice to any Owners,
from time to time and at any time, amend this Ordinance in any manner not detrimental to the
interests of the Owners, including the curing of any ambiguity, inconsistency, or formal defect or
omission herein. In addition, the City may, with the written consent of the Owners of the
Certificates holding a majority in aggregate principal amount of the Certificates then
outstanding, amend, add to, or rescind any of the provisions of this Ordinance; provided that,
without the consent of all Owners of outstanding Certificates, no such amendment, addition, or
rescission shall (i) extend the time or times of payment of the principal of and interest on the
Certificates, reduce the principal amount thereof, the redemption price, or the rate of interest
thereon, or in any other way modify the terms of payment of the principal of or interest on the
Certificates, (ii) give any preference to any Certificate over any other Certificate, or (iii) reduce
the aggregate principal amount of Certificates required to be held by Owners for consent to any
such amendment, addition, or rescission.
Section 13.02. Attorney General Modification.
In order to obtain the approval of the Certificates by the Attorney General of the State of
Texas, any provision of this Ordinance may be modified, altered or amended after the date of its
adoption if required by the Attorney General in connection with the Attorney General's
examination as to the legality of the Certificates and approval thereof in accordance with the
applicable law. Such changes, if any, shall be provided to the City Secretary and the City
Secretary shall insert such changes into this Ordinance as if approved on the date hereof.
ARTICLE XIV
EFFECTIVE IMMEDIATELY
Section 14.01. Effective Immediately.
Notwithstanding the provisions of the City Charter, this Ordinance shall become effective
immediately upon its adoption at this meeting pursuant to Section 1201.028, Texas Government
Code.
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PRESENTED, FINALLY PASSED AND APPROVED, AND EFFECTIVE on the 10th
day of April, 2014, at a regular meeting of the City Council of the City of Lubbock, Texas.
I, �: /V (/
GLE . ROf3ERTSON, Mayor
ATTEST:
CCA GARZA, City
[SEAL]
APPROVED AS TO CONTENT:
By. GI 06n='
PAMELA MOON, Executive Director of Finance
APPROVED AS TO FORM:
By: `r
JERK . KYLE, Jr., Bond Counsel
Signature Page for Ordinance
HOU:3414317.1
EXHIBIT A
DESCRIPTION OF ANNUAL DISCLOSURE OF FINANCIAL INFORMATION
The following information is referred to in Article XII of this Ordinance.
Annual Financial Statements and Operating Data
The financial information and operating data with respect to the City to be provided
annually in accordance with such Section are as specified (and included in the Appendix or other
headings of the Official Statement referred to) below:
1. The portions of the financial statements of the City appended to the Official
Statement as APPENDIX B, but for the most recently concluded fiscal year.
2. Statistical and financial data set forth in the Official Statement in
"APPENDIX A - FINANCIAL INFORMATION REGARDING THE CITY" (Tables 1-5 and 7-
17).
Accounting Principles
The accounting principles referred to in such Section are the accounting principles
described in the notes to the financial statements referred to in Paragraph 1 above.
Exhibit A-1
14OU:3414317.1
EXHIBIT B
SALE PARAMETERS
In accordance with Section 7.01(a) of the Ordinance, the following conditions with
respect to the Certificates must be satisfied in order for the Authorized Officer to act on behalf of
the City in selling and delivering the Certificates to the Underwriters:
(a) the price to be paid for the Certificates shall not be less than 90% of the aggregate
principal amount of the Certificates;
(b) the Certificates shall not bear interest at a rate greater than the maximum rate
allowed by Chapter 1204, Texas Government Code, as amended;
(c) the aggregate principal amount of the Certificates shall produce proceeds in an
amount sufficient, as determined by the Authorized Officer, to fund the purposes described in
Section 3.01 and such aggregate principal amount shall not exceed the maximum amount
authorized in Section 3.01;
(d) the maximum maturity for the Certificates shall not exceed twenty-one (2 1) years
from the date of their delivery; and
(e) the Certificates to be issued, prior to delivery, must have been rated by a
nationally recognized rating agency for municipal securities in one of the four highest rating
categories for long term obligations.
Exhibit B-1
HOU:3414317.1
EXHIBIT C
FORM OF THE CERTIFICATES
The form of the Certificates, including the form of the Registration Certificate of the
Comptroller of Public Accounts of the State of Texas, the form of Certificate of the Paying
Agent/Registrar and the form of Assignment appearing on the Certificates, shall be generally as
follows, provided, however, that the substantially final form of the Certificates shall be set forth
in or attached to the Pricing Certificate and shall incorporate and reflect the final terms of the
Certificates set forth in the Pricing Certificate:
(a) Form of Certificate.
REGISTERED
No.
United States of America
State of Texas
County of Lubbock
CITY OF LUBBOCK, TEXAS
TAX AND WATERWORKS SYSTEM SURPLUS REVENUE
CERTIFICATES OF OBLIGATION
SERIES 2014
CERTIFICATE
INTEREST RATE: MATURITY DATE: DATE:
REGISTERED
CUSIP NUMBER:
The City of Lubbock (the "City"), in the County of Lubbock, State of Texas, for value
received, hereby promises to pay to
or registered assigns, on the Maturity Date specified above, the sum of
DOLLARS
unless this Certificate shall have been sooner called for redemption and the payment of the
principal hereof shall have been paid or provided for, and to pay interest on such principal
amount from the later of the Certificate Date specified above or the most recent interest payment
date to which interest has been paid or provided for until payment of such principal amount has
been paid or provided for, at the per annum rate of interest specified above, computed on the
basis of a 360 -day year of twelve 30 -day months, such interest to be paid semiannually on
1 Information to be inserted from Pricing Certificate.
Exhibit C-1
HOU:3414317.1
February 15 and August 15 of each year, commencing Z. All capitalized terms used
herein but not defined shall have the meaning assigned to them in the Ordinance (defined below).
The principal of this Certificate shall be payable without exchange or collection charges
in lawful money of the United States of America upon presentation and surrender of this
Certificate at the corporate trust office in Dallas, Texas (the "Designated Payment/Transfer
Office"), of , the initial Paying Agent/Registrar,
or, with respect to a successor Paying Agent/Registrar, at the Designated Payment/Transfer
Office of such successor. Interest on this Certificate is payable by check dated as of the interest
payment date, and will be mailed by the Paying Agent/Registrar to the registered owner at the
address shown on the registration books kept by the Paying Agent/Registrar or by such other
customary banking arrangement acceptable to the Paying Agent/Registrar and the registered
owner; provided, however, such registered owner shall bear all risk and expenses of such
customary banking arrangement. At the option of an Owner of at least $1,000,000 principal
amount of the Certificates, interest may be paid by wire transfer to the bank account of such
Owner on file with the Paying Agent/Registrar. For the purpose of the payment of interest on
this Certificate, the registered owner shall be the person in whose name this Certificate is
registered at the close of business on the "Record Date," which shall be the last business day of
the month next preceding such interest payment date; provided, however, that in the event of
nonpayment of interest on a scheduled payment date and for 30 days thereafter, a new record
date for such interest payment (a "Special Record Date") will be established by the Paying
Agent/Registrar, if and when funds for the payment of such interest have been received from the
City. Notice of the Special Record Date and of the scheduled payment date of the past due
interest (the "Special Payment Date," which shall be 15 days after the Special Record Date) shall
be sent at least five business days prior to the Special Record Date by first-class United States
mail, postage prepaid, to the address of each owner of a Certificate appearing in the registration
books of the Paying Agent/Registrar at the close of business on the last business day next
preceding the date of mailing of such notice.
If the date for the payment of the principal of or interest on this Certificate shall be a
Saturday, Sunday, legal holiday, or day on which banking institutions in the city where the
Designated Payment/Transfer Office of the Paying Agent/Registrar is located are required or
authorized by law or executive order to close, the date for such payment shall be the next
succeeding day that is not a Saturday, Sunday, legal holiday, or day on which banking
institutions are required or authorized to close, and payment on such date shall have the same
force and effect as if made on the original date payment was due.
This Certificate is one of a series of fully registered certificates specified in the title
hereof issued in the aggregate principal amount of $ 3 (herein referred to as the
"Certificates"), issued pursuant to a certain ordinance of the City (the "Ordinance") for the
purpose of paying contractual obligations to be incurred for authorized public improvements
(collectively, the "Project"), as described in the Ordinance, and to pay the contractual obligations
for professional services of attorneys, financial advisors and other professionals in connection
with the Project and the issuance of the Certificates.
Z Information to be inserted from Pricing Certificate.
3 Information to be inserted from Pricing Certificate.
Exhibit C-2
HOU:3414317.1
[The City has reserved the option to redeem the Certificates maturing on or after
February 15, 20in whole or in part, before their respective scheduled maturity dates, on
,20 or on any date thereafter, at a price equal to the principal amount of the
Certificates so called for redemption plus accrued interest to the date fixed for redemption. If
less than all of the Certificates are to be redeemed, the City shall determine the maturity or
maturities and the amounts thereof to be redeemed and shall direct the Paying Agent/Registrar to
call by lot or other customary method that results in a random selection the Certificates, or
portions thereof, within such maturity and in such principal amounts, for redemption .]4
[Certificates maturing on February 15 in each of the years through _, inclusive
(the "Term Certificates"), are subject to mandatory sinking fund redemption prior to their
scheduled maturity, and will be redeemed by the City, in part at a redemption price equal to the
principal amount thereof, without premium, plus interest accrued to the redemption date, on the
dates and in the principal amounts shown in the following schedule:
Term Certificates Maturing February 15, 20.
Redemption Date Principal Amount
February 15, 20_
February 15, 20_
February 15, 20_ (maturity)
The Paying Agent/Registrar will select by lot or by any other customary method that
results in a random selection the specific Term Certificates (or with respect to Term Certificates
having a denomination in excess of $5,000, each $5,000 portion thereof) to be redeemed by
mandatory redemption. The principal amount of Term Certificates required to be redeemed on
any redemption date pursuant to the foregoing mandatory sinking fund redemption provisions
hereof shall be reduced, at the option of the City, by the principal amount of any Certificates
which, at least forty-five (45) days prior to the mandatory sinking fund redemption date (i) shall
have been acquired by the City at a price not exceeding the principal amount of such Certificates
plus accrued interest to the date of purchase thereof, and delivered to the Paying Agent/Registrar
for cancellation, or (ii) shall have been redeemed pursuant to the optional redemption provisions
hereof and not previously credited to a mandatory sinking fund redemption.]5
Notice of such redemption or redemptions shall be given by first class mail, postage
prepaid, not less than thirty (30) days before the date fixed for redemption, to the registered
owner of each of the Certificates to be redeemed in whole or in part. In the Ordinance, the City
reserves the right in the case of an optional redemption to give notice of its election or direction
to redeem Certificates conditioned upon the occurrence of subsequent events. Such notice may
state (i) that the redemption is conditioned upon the deposit of moneys and/or authorized
securities, in an amount equal to the amount necessary to effect the redemption, with the Paying
Agent/Registrar, or such other entity as may be authorized by law, no later than the redemption
date or (ii) that the City retains the right to rescind such notice at any time prior to the scheduled
4 Insert optional redemption provisions, if any, and revise as necessary to conform to the Pricing Certificate.
5 Insert mandatory sinking fund redemption provisions, if any, and conform as necessary to the Pricing Certificate.
Exhibit C-3
HOU:3414317.1
redemption date if the City delivers a certificate of the City to the Paying Agent/Registrar
instructing the Paying Agent/Registrar to rescind the redemption notice, and such notice and
redemption shall be of no effect if such moneys and/or authorized securities are not so deposited
or if the notice is rescinded. The Paying Agent/Registrar shall give prompt notice of any such
rescission of a conditional notice of redemption to the affected owners. Any Certificates subject
to conditional redemption where redemption has been rescinded shall remain Outstanding, and
the rescission shall not constitute an event of default. Further, in the case of a conditional
redemption, the failure of the City to make moneys and/or authorized securities available in part
or in whole on or before the redemption date shall not constitute an event of default.
As provided in the Ordinance, and subject to certain limitations therein set forth, this
Certificate is transferable upon surrender of this Certificate for transfer at the designated office of
the Paying Agent/Registrar with such endorsement or other evidence of transfer as is acceptable
to the Paying Agent/Registrar; thereupon, one or more new fully registered Certificates of the
same stated maturity, of authorized denominations, bearing the same rate of interest, and for the
same aggregate principal amount will be issued to the designated transferee or transferees.
Neither the City nor the Paying Agent/Registrar shall be required to issue, transfer or
exchange any Certificate called for redemption where such redemption is scheduled to occur
within forty five (45) calendar days of the transfer or exchange date; provided, however, such
limitation shall not be applicable to an exchange by the registered owner of the uncalled
principal balance of a Certificate.
The City, the Paying Agent/Registrar, and any other person may treat the person in whose
name this Certificate is registered as the owner hereof for the purpose of receiving payment as
herein provided (except interest shall be paid to the person in whose name this Certificate is
registered on the Record Date or Special Record Date, as applicable) and for all other purposes,
whether or not this Certificate be overdue, and neither the City nor the Paying Agent/Registrar
shall be affected by notice to the contrary.
IT IS HEREBY CERTIFIED AND RECITED that the issuance of this Certificate and the
series of which it is a part is duly authorized by law; that all acts, conditions, and things to be
done precedent to and in the issuance of the Certificates have been properly done and performed
and have happened in regular and due time, form, and manner as required by law; that ad
valorem taxes upon all taxable property in the City have been levied for and pledged to the
payment of the debt service requirements of the Certificates within the limit prescribed by law;
that, in addition to said taxes, further provisions have been made for the payment of the debt
service requirements of the Certificates by pledging to such purpose Surplus Revenues, as
defined in the Ordinance, derived by the City from the operation of the Waterworks System in an
amount limited to $1,000; that when so collected, such taxes and Surplus Revenues shall be
appropriated to such purposes; and that the total indebtedness of the City, including the
Certificates, does not exceed any constitutional or statutory limitation.
Exhibit C-4
HOU:3414317.1
IN WITNESS WHEREOF, the City has caused this Certificate to be executed by the
manual or facsimile signature of the Mayor of the City and countersigned by the manual or
facsimile signature of the City Secretary, and the official seal of the City has been duly
impressed or placed in facsimile on this Certificate.
Mayor, City of Lubbock, Texas
City Secretary,
City of Lubbock, Texas
[SEAL]
(b) Form of Comptroller's Registration Certificate. The following Comptroller's
Registration Certificate may be deleted from the definitive Certificates if such certificate on the
Initial Certificate is fully executed.
OFFICE OF THE COMPTROLLER §
OF PUBLIC ACCOUNTS § REGISTER NO.
OF THE STATE OF TEXAS §
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 Certificate has been examined by him as
required by law, 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 obligation of the City of Lubbock, Texas;
and that this Certificate has this day been registered by me.
Witness my hand and seal of office at Austin, Texas,
[SEAL] Comptroller of Public Accounts
of the State of Texas
(c) Form of Certificate of Pang Agent/Registrar. The following Certificate of
Paying Agent/Registrar may be deleted from the Initial Certificate if the Comptroller's
Registration Certificate appears thereon.
Exhibit C-5
HOU:3414317.1
CERTIFICATE OF PAYING AGENT/REGISTRAR
The records of the Paying Agent/Registrar show that the Initial Certificate of this series
of Certificates was approved by the Attorney General of the State of Texas and registered by the
Comptroller of Public Accounts of the State of Texas, and that this is one of the Certificates
referred to in the within -mentioned Ordinance.
Dated:
(d) Form of Assignment.
as Paying Agent/Registrar
M.
ASSIGNMENT
Authorized Signatory
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto (print or
typewrite name, address and Zip Code of transferee):
(Social Security or other identifying number: ) the within Certificate
and all rights hereunder and hereby irrevocably constitutes and appoints
attorney to transfer the within Certificate on the books kept for
registration hereof, with full power of substitution in the premises.
Dated:
Signature Guaranteed By:
Authorized Signatory
NOTICE: The signature on this Assignment
must correspond with the name of the
registered owner as it appears on the face of
the within Certificate in every particular and
must be guaranteed in a manner acceptable to
the Paying Agent/Registrar.
(e) The Initial Certificate shall be in the form set forth in paragraphs (a), (b) and (d)
of this Section, except for the following alterations:
(i) immediately under the name of the Certificate the headings "INTEREST
RATE" and "MATURITY DATE" shall both be completed with the words "As shown
below"; and
(ii) in the first paragraph of the Certificate, the words "on the Maturity Date
specified above" shall be deleted and the following will be inserted: "on February 15 in
Exhibit C-6
HOU:3414317.1
each of the years, in the principal installments and bearing interest at the per annum rates
set forth in the following schedule:
Years Principal Installments Interest Rate
(Information to be inserted from the Pricing Certificate
pursuant to Section 3.02 of this Ordinance)
Exhibit C-7
HOU:3414317.1
MINUTES AND CERTIFICATION PERTAINING TO
PASSAGE OF AN ORDINANCE
STATE OF TEXAS §
COUNTY OF LUBBOCK §
CITY OF LUBBOCK §
On the 10th day of April, 2014, the City Council of the City of Lubbock, Texas,
convened in a regular meeting at the regular meeting place thereof, the meeting being open to the
public and notice of said meeting, giving the date, place and subject thereof, having been posted
as prescribed by Chapter 551, Texas Government Code, as amended; and the roll was called of
the duly constituted officers and members of the City Council, which officers and members are
as follows:
Glen Robertson, Mayor Victor Hernandez )
Karen Gibson, Mayor Pro Tem Todd R. Klein ) Members of
Jim Gerlt ) the Council
Floyd Price )
Latrelle Joy )
James Loomis, City Manager
Pamela Moon, Executive Director of Finance
Rebecca Garza, City Secretary
and all of said persons were present, except Karen Gibson and Floyd thus constituting a
quorum. Whereupon, among other business, a written Ordinance bearing the following caption
was introduced:
AN ORDINANCE PROVIDING FOR THE ISSUANCE OF CITY
OF LUBBOCK, TEXAS, TAX AND WATERWORKS SYSTEM
SURPLUS REVENUE CERTIFICATES OF OBLIGATION,
SERIES 2014; LEVYING A TAX AND PLEDGING SURPLUS
WATERWORKS SYSTEM REVENUES IN PAYMENT
THEREOF; PROVIDING FOR THE AWARD OF THE SALE
THEREOF IN ACCORDANCE WITH SPECIFIED
PARAMETERS; APPROVING THE OFFICIAL STATEMENT;
APPROVING EXECUTION OF A PURCHASE CONTRACT;
AND ENACTING OTHER PROVISIONS RELATING
THERETO
The Ordinance, a full, true and correct copy of which is attached hereto, was read and
reviewed by the City Council. Thereupon, it was duly moved and seconded that the Ordinance
be passed and adopted.
HOU:3425037.1
The Presiding Officer put the motion to a vote of the members of the City Council, and
the Ordinance was passed and adopted by the following vote:
AYES: 5 NOES: 0 ABSTENTIONS: 2
MINUTES APPROVED AND CERTIFIED TO BE TRUE AND CORRECT, and to
correctly reflect the duly constituted officers and members of the City Council of said City, and
the attached and following copy of said Ordinance is hereby certified to be a true and correct
copy of an official copy thereof on file among the official records of the City, all on this the 10th
day of April, 2014.
City S cretary
City of Lubbock, Texas
[SEAL]
HOU:3425037.1