0739ORDINANCE NO. 739
AN ORDINANCE authorizing the issuance of "CITY OF SOUTHLAKE, TEXAS,
TAX AND WATERWORKS AND SEWER SYSTEM (LIMITED PLEDGE)
REVENUE CERTIFICATES OF OBLIGATION, SERIES 1999"; specifying
the terms and features of said certificates; providing for the payment of said
certificates of obligation by the levy of an ad valorem tax upon all taxable
property within the City and a limited pledge of the net revenues from the
operation of the City's Waterworks and Sewer System; and resolving other
matters incident and relating to the issuance, payment, security, sale and
delivery of said Certificates, including the approval and execution of a
Paying Agent/Registrar Agreement and a Purchase Contract and the
approval and distribution of an Official Statement; and providing an
effective date.
WHEREAS, notice of the City Council's intention to issue certificates of obligation in the
maximum principal amount of $17,030,000 for the purposes of paying contractual obligations to
be incurred for (a) the construction of public works, to wit: (i) improvements and extensions to
water and sewer facilities, (ii) street improvements, including land and rights-of-way acquisition,
incidental drainage and traffic signalization, (iii) drainage improvements, including the purchase
of land and rights-of-way, and (iv) improvements and repairs to the City's storage and
administrative facilities for the public works department, (b) the purchase of technology
equipment and software for city facilities and departments and for the purchase of water and
sewer utility lines, and (c) professional services rendered in relation to such projects and the
financing thereof, has been duly published in The Fort Worth Star Telegram, a newspaper
hereby found and determined to be of general circulation in the City of Southlake, Texas, on
March 3, 1999 and March 10, 1999, the date the first publication of such notice being not less
than fifteen (15) days prior to the tentative date stated therein for the second reading and final
passage of the ordinance authorizing the issuance of such certificates; and
WHEREAS, no petition protesting the issuance of the certificates of obligation and
bearing valid petition signatures of at least 5% of the qualified electors of the City, has been
presented to or filed with the Mayor, City Secretary or any other official of the City on or pdor to
the date of the passage of this ordinance; and
WHEREAS, the Council hereby finds and determines that all of the certificates of
obligation described in the aforesaid notice should be issued and sold at this time; now,
therefore,
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF SOUTHLAKE, TEXAS:
SECTION 1: Authorization, Designation, Principal Amount, Purpose. Certificates of
obligation of the City shall be and are hereby authorized to be issued in the aggregate principal
amount of $17,050,000, to be designated and bear the title "CITY OF SOUTHLAKE, TEXAS,
TAX AND WATERWORKS AND SEWER SYSTEM (LIMITED PLEDGE) REVENUE
CERTIFICATES OF OBLIGATION, SERIES 1999" (hereinafter referred to as the "Certificates"),
for the purposes of paying contractual obligations to be incurred for (a) the construction of public
works, to wit: (i) improvements and extensions to water and sewer facilities, (ii) street
improvements, including land and rights-of-way acquisition, incidental drainage and traffic
signalization, (iii) drainage improvements, including the purchase of land and rights-of-way, and
(iv) improvements and repairs to the City's storage and administrative facilities for the public
works department, (b) the purchase of technology equipment and software for city facilities and
departments and for the purchase of water and sewer utility lines, and (c) professional services
rendered in relation to such projects and the financing thereof, pursuant to authority conferred
by and in conformity with the Constitution and laws of the State of Texas, including V.T.C.A.,
Local Oovemment Code, Subchapter C of Chapter 271, as amended.
SECTION 2: Fully Reqistered Obligations - Authorized Denominations-Stated
Maturities-Date. The Certificates are issuable in fully registered form only; shall be dated Apdl
1, 1999 (the "Certificate Date") and shall be in denominations of $5,000 or any integral multiple
thereof (within a Stated Maturity) and the Certificates shall become due and payable on February
15 in each of the years and in principal amounts (the "Stated Maturities") and bear interest at the
per annum rate(s) in accordance with the following s_chedule:
Year of Principal interest
Stated Matudty Amount Rate(s}
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
$320,000
620 000
845 000
880 000
705 000
740 000
770 000
815 000
740 000
780 000
820 000
855,000
900,000
940,000
1,035,000
1,090,000
1,140,000
1,195,000
1,250,000
5.00%
5.00%
5.00%
5.00%
4.875%
4.05%
4.15%
4.25%
4.35%
4.40%
4.50%
4.60%
4.70%
4.80%
4.875%
5.00%
5.00%
5.00%
5.00%
5.00%
The Certificates shall bear interest on the unpaid principal amounts from the Certificate
Date at the rate per annum shown above in this Section (calculated on the basis of a 360-day
year of twelve 30-day months), and such interest shall be payable on February 15 and August
15 of each year, commencing February 15, 2000.
SECTION 3: Terms of Payment-Payinq A.qentJRe,qistrar. The principal of, premium, if
any, and the interest on the Certificates, due and payable by reason of maturity, redemption, or
otherwise, shall be payable only to the registered owners or holders of the Certificates
(hereinafter called the "Holders") appearing on the registration and transfer books maintained
by the Paying Agent/Registrar and the payment thereof shall be in any coin or currency of the
United States of America, which at the time of payment is legal tender for the payment of public
and private debts, and shall be without exchange or collection charges to the Holders.
The selection and appointment of Chase Bank of Texas, National Association to serve as
Paying Agent/Registrar for the Certificates is hereby approved and confirmed. Books and
records relating to the registration, payment, transfer and exchange of the Certificates (the
"Security Register") shall at all times be kept and maintained on behalf of the City by the Paying
Agent/Registrar, as provided herein and in accordance with the terms and provisions of a
"Paying Agent/Registrar Agreement", substantially in the form attached hereto as Exhibit A, and
such reasonable rules and regulations as the Paying Agent/Registrar and the City may prescribe.
The Mayor and City Secretary are authorized to execute and deliver such Agreement in
connection with the delivery of the Certificates. The City covenants to maintain and provide a
Paying Agent/Registrar at alt times until the Certificates are paid and discharged, and any
successor Paying Agent/Registrar shall be a bank, trust company, financial institution or other
entity qualified and authorized to serve in such capacity and perform the duties and services of
Paying Agent/Registrar. Upon any change in the Paying Agent/Registrar for the Certificates,
the City agrees to promptly cause a wdtten notice thereof to be sent to each Holder by United
States Mail, first class postage prepaid, which notice shall also give the address of the new
Paying Agent/Registrar
Principal of and premium, if any, on the Certificates shall be payable at the Stated
Maturities or the redemption thereof only upon presentation and surrender of the Certificates to
the Paying Agent/Registrar at its designated offices in Dallas, Texas (the "Designated
Payment/Transfer Office"). Interest on the Certificates shall be paid to the Holders whose name
appears in the Security Register at the close of business on the Record Date (the last business
day of the month next preceding each interest payment date) and shall be paid by the Paying
Agent/Registrar (i) by check sent United States Mail, first class postage prepaid, to the address
of the Holder recorded in the Security Register or (ii) by such other method, acceptable to the
Paying Agent/Registrar, requested by, and at the risk and expense of, the Holder. If the date
for the payment of the principal of or interest on the Certificates shall be a Saturday, Sunday,
a legal holiday, or a day when banking institutions in the City where the Designated
Payment/Transfer Office of the Paying Agent/Registrar is located are authorized by law or
executive order to close, then the date for such payment shall be the next succeeding day which
is not such a Saturday, Sunday, legal holiday, or day when banking institutions are 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.
In the event of a nonpayment of interest on a scheduled payment date, and for thirty (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
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payment date of the past due interest (which shall be 15 days after the Special Record Date)
shall be sent at least five (5) business days pdor to the Special Record Date by United States
Mail, first class postage prepaid, to the address of each Holder appearing on the Secudty
Register at the close of business on the last business next preceding the date of mailing of such
notice
SECTION 4: Redemption. (a) Optional Redemption. The Certificates having Stated
Maturities on and after February 15, 2009 shall be subject to redemption pdor to maturity, at the
option of the City, in whole or in part in principal amounts of $5,000 or any integral multiple
thereof (and if within a Stated Maturity by lot by the Paying Agent/Registrar), on February 15,
2008, or on any date thereafter at the redemption pdce of par plus accrued interest to the date
of redemption.
(b) Exercise of Redemption Option. At least forty-five (45) days pdor to a redemption date
for the Certificates (unless a shorter notification pedod shall be satisfactory to the Paying
Agent/Registrar), the City shall notify the Paying ACentJRegistrar of the decision to redeem
Certificates, the principal amount of each Stated Matudty to be redeemed, and the date of
redemption therefor. The decision of the City to exercise the dght to redeem Certificates shall
be entered in the minutes of the governing body of the City.
(c) Selection of Certificates for Redemption. If less than all Outstanding Certificates of the
same Stated Matudty are to be redeemed on a redemption date, the Paying Agent/Registrar
shall treat such Certificates as representing the number of Certificates Outstanding which is
obtained by dividing the principal amount of such Certificates by $5,000 and shall select the
Certificates to be redeemed within such Stated Matudty by lot.
(d) Notice of Redemption. Not less than thirty (30) days pdor to a redemption date for
the Certificates, a notice of redemption shall be sent by United States Mail, first class postage
prepaid, in the name of the City and at the City's expense, to each Holder of a Certificate to be
redeemed in whole or in part at the address of the Holder appearing on the Secudty Register at
the close of business on the business day next preceding the date of mailing such notice, and
any notice of redemption so mailed shall be conclusively presumed to have been duly given
irrespective of whether received by the Holder.
All notices of redemption shall (i) specify the date of redemption for the Certificates, (ii)
identify the Certificates to be redeemed and, in the case of a portion of the principal amount to
be redeemed, the principal amount thereof to be redeemed, (iii) state the redemption pdce,
(iv) state that the Certificates, or the portion of the principal amount thereof to be redeemed, shall
become due and payable on the redemption date specified and the interest thereon, or on the
portion of the principal amount thereof to be redeemed, shall cease to accrue from and after the
redemption date, provided moneys sufficient for the payment of such Certificate (or the principal
amount thereof to be redeemed) at the then applicable redemption pdce are held for the purpose
of such payment by the Paying Agent/Registrar and (v) specify that payment of the redemption
price for the Certificates, or the principal amount thereof to be redeemed, shall be made at the
Designated Payment/Transfer Office of the Paying Agent/Registrar only upon presentation and
surrender of the Certificates. If a Certificate is subject by its terms to pdor redemption and has
been called for redemption and notice of redemption has been duly given as hereinabove
provided, such Certificate (or the principal amount thereof to be redeemed) shall become due
and payable and interest thereon shall cease to accrue from and after the redemption date
therefor.
SECTION 5: Reqistration Transfer - Exchanqe of Certificates-Predecessor
Certificates. The Paying Agent/Registrar shall obtain, record, and maintain in the Secudty
Register the name and address of each and every owner of the Certificates issued under and
pursuant to the provisions of this Ordinance, or if appropriate, the nominee thereof. Any
Certificate may be transferred or exchanged for Certificates of other authorized denominations
by the Holder, in person or by his duly authorized agent, upon surrender of such Certificate to
the Paying Agent/Registrar for cancellation, accompanied by a wdtten instrument of transfer or
request for exchange duly executed by the Holder or by his duly authorized agent, in form
satisfactory to the Paying Agent/Registrar.
Upon surrender of any Certificate for transfer at'the Designated Payment/Transfer Office
of the Paying Agent/Registrar, the Paying Agent/Registrar shall register and deliver, in the name
of the designated transferee or transferees, one or more new Certificates of authorized
denominations and having the same Stated Matudty and of a like aggregate principal amount
as the Certificate or Certificates surrendered for transfer.
At the option of the Holder, Certificates may be exchanged for other Certificates of
authorized denominations and having the same Stated Maturity, beadng the same rate of
interest and of like aggregate principal amount as the Certificates surrendered for exchange,
upon surrender of the Certificates to be exchanged at the Designated Payment/Transfer Office
of the Paying Agent/Registrar. Whenever any Certificates are surrendered for exchange, the
Paying Agent/Registrar shall register and deliver new Certificates to the Holder requesting the
exchange.
All Certificates issued in any transfer or exchange of Certificates shall be delivered to the
Holders at the Designated Payment/Transfer Office of the Paying Agent/Registrar or sent by
United States Mail, first class, postage prepaid to the Holders, and, upon the registration and
delivery thereof, the same shall be the valid obligations of the City, evidencing the same
obligation to pay, and entitled to the same benefits under this Ordinance, as the Certificates
surrendered in such transfer or exchange.
All transfers or exchanges of Certificates pursuant to this Section shall be made without
expense or service charge to the Holder, except as otherwise herein provided, and except that
the Paying Agent/Registrar shall require payment by the Holder requesting such transfer or
exchange of any tax or other governmental charges required to be paid with respect to such
transfer or exchange.
Certificates cancelled by reason of an exchange or transfer pursuant to the provisions
hereof are hereby defif~ed to be "Predecessor Certificates," evidencing all or a portion, as the
case may be, of the same obligation to pay evidenced by the new Certificate or Certificates
registered and delivered in the exchange or transfer therefor. Additionally, the term
"Predecessor Certificates" shall include any mutilated, lost, destroyed, or stolen Certificate for
which a replacement Certificate has been issued, registered and delivered in lieu thereof
pursuant to the provisions of Section 19 hereof and such new replacement Certificate shall be
deemed to evidence the same obligation as the mutilated, lost, destroyed, or stolen Certificate.
Neither the City nor the Paying Agent/Registrar shall be required to issue or transfer to an
assignee of a Holder any Certificate called for redemption, in whole or in part, within 45 days of
the date fixed for the redemption of such Certificate; provided, however, such limitation on
transferability shall not be applicable to an exchange by the Holder of the unredeemed balance
of a Certificate called for redemption in part.
SECTION 6: Book-Entry Only Transfers and Transactions. Notwithstanding the provisions
contained in Sections 3, 4 and 5 hereof relating to the payment, and transfedexchange of the
Certificates, the City hereby approves and authorizes the use of "Book-Entry Only" securities
clearance, settlement and transfer system provided b..v The Depository Trust Company (DTC),
a limited purpose trust company organized under the laws of the State of New York, in
accordance with the operational arrangements referenced in the Blanket Issuer Letter of
Representation, by and between the City and DTC (the "Depository Agreement").
Pursuant to the Depository Agreement and the rules of DTC, the Certificates shall be
deposited with DTC who shall hold said Certificates for its participants (the "DTC Participants").
While the Certificates are held by DTC under the Depository Agreement, the Holder of the
Certificates on the Security Register for all purposes, including payment and notices, shall be
Cede & Co., as nominee of DTC, notwithstanding the ownership of each actual purchaser or
owner of each Certificate (the "Beneficial Owners") being recorded in the records of DTC and
DTC Participants.
In the event OTC determines to discontinue serving as securities depository for the
Certificates or otherwise ceases to provide book-entry clearance and settlement of securities
transactions in general or the City determines that DTC is incapable of properly discharging its
duties as securities depository for the Certificates, the City covenants and agrees with the
Holders of the Certificates to cause Certificates to be pdnted in definitive form and provide for
the Certificate certificates to be issued and delivered to DTC Participants and Beneficial Owners,
as the case may be. Thereafter, the Certificates in definitive form shall be assigned, transferred
and exchanged on the Secudty Register maintained by the Paying Agent/Registrar and payment
of such Certificates shall be made in accordance with the provisions of Sections 3, 4 and 5
hereof.
SECTION 7: Execution - Reqistration. The Certificates shall be executed on behalf of
the City by the Mayor under its seal reproduced or impressed thereon and countersigned by the
City Secretary. The signature of said officers on the Certificates may be manual or facsimile.
Certificates beadng the manual or facsimile signatures of individuals who are or were the proper
officers of the City on the Certificate Date shall be deemed to be duly executed on behalf of the
City, notwithstanding that one or more of the individuals executing the same shall cease to be
such officer at the time of delivery of the Certificates to the initial purchaser(s) and with respect
761650.I -6-
to Certificates delivered in subsequent exchanges and transfers, all as authorized and provided
in the Bond Procedures Act of 1981, as amended.
No Certificate shall be entitled to any dght or benefit under this Ordinance, or be valid or
obligatory for any purpose, unless there appears on such Certificate either a certificate of
registration substantially in the form provided in Section 9C, manually executed by the
Comptroller of Public Accounts of the State of Texas, or his duly authorized agent, or a certificate
of registration substantially in the form provided in Section 9D, manually executed by an
authorized officer, employee or representative of the Paying Agent/Registrar, and either such
certificate duly signed upon any Certificate shall be conclusive evidence, and the only evidence,
that such Certificate has been duly certified, registered and delivered.
SECTION 8: Initial Certificate(s). The Certificates herein authorized shall be initially
issued either (i) as a single futly registered certificate in the total pnncipal amount of $17,030,000
with principal installments to become due and payable as provided in Section 2 hereof and
numbered T-l, or (ii) as multiple fully registered certificates, being one certificate for each year
of matudty in the applicable principal amount and denomination and to be numbered
consecutively from T-1 and upward (hereinafter called the "Initial Certificate(s)") and, in either
case, the initial Certificate(s) shall be registered in the name of the initial purchaser(s) or the
designee thereof. The Initial Certificate(s) shall be the Certificates submitted to the Office of the
Attorney General of the State of Texas for approval, certified and registered by the Office of the
Comptroller of Public Accounts of the State of Texas and delivered to the initial purchaser(s).
Any time after the delivery of the Initial Certificate(s), the Paying AgentJRegistrar, pursuant to
wdtten instructions from the initial purchaser(s), or the designee thereof, shall cancel the Initial
Certificate(s) delivered hereunder and exchange therefor definitive Certificates of authorized
denominations, Stated Maturities, principal amounts and beadng applicable interest rates for
transfer and delivery to the Holders named at the addresses identified therefor;, all pursuant to
and in accordance with such wdtten instructions from the initial purchaser(s), or the designee
thereof, and such other information and documentation as the Paying Agent/Registrar may
reasonably require
SECTION 9: Forms. A. Forms Generally. The Certificates, the Registration Certificate
of the Comptroller of Public Accounts of the State of Texas, the Registration Certificate of Paying
Agent/Registrar, and the form of Assignment to be printed on each of the Certificates, shall be
substantially in the forms set forth in this Section with such appropriate insertions, omissions,
substitutions, and other variations as are permitted or required by this Ordinance and 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 Amedcan Bankers
Association) and such legends and endorsements (including insurance legends in the event the
Certificates, or any maturities thereof, are purchased with insurance and any reproduction of an
opinion of counsel) thereon as may, consistently herewith, be established by the City or
determined by the officers executing such Certificates as evidenced by their execution. Any
portion of the text of any Certificates may be set forth on the reverse thereof, with an appropriate
reference thereto on the face of the certificate.
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The definitive Certificates and the Initial Certificate(s) shall be pdnted, lithographed, or
engraved, typewritten, photocopied or otherwise reproduced in any other similar manner, all as
determined by the officers executing such Certificates as evidenced by their execution.
B. Form of Certificates.
REGISTERED REGISTERED
NO. $
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF SOUTHLAKE, TEXAS,
TAX AND WATERWORKS AND SEWER SYSTEM
(LIMITED PLEDGE) REVENUE
CERTIFICATE OF OBLIGATION,
SERIES 1999
Certificate Date:
April 1, 1999
Interest Rate:
Stated Maturity:
CUSIP NO:
Registered Owner:
Principal Amount:
DOLLARS
The City of Southlake (hereinafter referred to as the "City"), a body corporate and
municipal corporation in the Counties of Tarrant and Denton, State of Texas, for value received,
acknowledges itself indebted to and hereby promises to pay to the order of the Registered
Owner named above, or the registered assigns thereof, on the Stated Matudty date specified
above the Principal Amount hereinabove stated (or so much thereof as shall not have been paid
upon prior redemption) and to pay interest on the unpaid principal amount hereof from the
Certificate Date 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 being payable on February 15 and August
15 in each year, commencing February 15, 2000. Principal of this Certificate is payable at its
Stated Matudty or redemption to the registered owner hereof, upon presentation and surrender,
at the Designated Payment/Transfer Office of the Paying Agent/Registrar executing the
registration certificate appearing hereon, or its successor; provided, however, while this
Certificate is registered to Cede & Co., the payment of principal upon a partial redemption of the
principal amount hereof may be accomplished without presentation and surrender of this
Certificate. Interest is payable to the registered owner of this Certificate (or one or more
Predecessor Certificates, as defined in the Ordinance hereinafter referenced) whose name
appears on the "Security Register" maintained by the Paying Agent/Registrar at the close of
business on the "Record Date", which is the last business day of the month next preceding
each interest payment date, and interest shall be paid by the Paying Agent/Registrar by check
sent United States Mail, first class postage prepaid, to the address of the registered owner
recorded in the Security Register or by such other method, acceptable to the Paying
Agent/Registrar, requested by, and at the dsk and expense of, the registered owner. All
payments of pnncipal of, premium, if any, and interest on this Certificate shall be without
exchange or collection charges to the owner hereof and in any coin or currency of the United
States of Amedca which at the time of payment is legal tender for the payment of public and
pnvate debts.
This Certificate is one of the sedes specified in its title issued in the aggregate principal
amount of $17,030,000 (herein referred to as the "Certificates") for the purpose of paying
contractual obligations to be incurred for (a) the construction of public works, to wit: (i)
improvements and extensions to water and sewer facilities, (ii) street improvements, including
land and rights-of-way acquisition, incidental drainage and traffic signalization, (iii) drainage
improvements, including the purchase of land and rights-of-way, and (iv) improvements and
repairs to the City's storage and administrative facilities for the public works department, (b) the
purchase of technology equipment and software for _city facilities and departments and for the
purchase of water and sewer utility lines, and (c) professional services rendered in relation to
such projects and the financing thereof, under and in stdct conformity with the Constitution and
laws of the State of Texas, particularly V.T.C.A., Local Government Code, Subchapter C of
Chapter 271, as amended, and pursuant to an Ordinance adopted by the City Council of the City
(herein referred to as the "Ordinance").
The Certificates maturing on and after February 15, 2009, may be redeemed pdor to their
Stated Maturities, at the option of the City, in whole or in part in principal amounts of $5,000 or
any integral multiple thereof (and if within a Stated Maturity by lot by the Paying Agent/Registrar),
on February 15, 2008, or on any date thereafter, at the redemption pdca of par, together with
accrued interest to the date of redemption.
At least thirty days pdor to a redemption date, the City shall cause a wdtten notice of such
redemption to be sent by United States Mail, first class postage prepaid, to the registered owners
of each Certificate to be redeemed at the address shown on the Secudty Register and subject
to the terms and provisions relating thereto contained in the Ordinance. If a Certificate (or any
portion of its principal sum) shall have been duly called for redemption and notice of such
redemption duly given, then upon the redemption date such Certificate (or the portion of its
principal sum to be redeemed) shall become due and payable, and, if moneys for the payment
of the redemption pdce and the interest accrued on the principal amount to be redeemed to the
date of redemption are held for the purpose of such payment by the Paying Agent/Registrar,
interest shall cease to accrue and be payable from and after the redemption date on the principal
amount redeemed.
In the event a portion of the principal amount of a Certificate is to be redeemed and the
registered owner is someone other than Cede & Co., payment of the redemption pdca of such
principal amount shall be made to the registered owner only upon presentation and surrender
of such Certificate to the Designated PaymenCl'ransfer Office of the Paying Agent/Registrar, and
a new Certificate or Certificates of like maturity and interest rate in any authorized denominations
provided by the Ordinance for the then unredeemed balance of the principal sum thereof will be
issued to the registered owner, without charge. If a Certificate is selected for redemption, in
761630A -9-
whole or in part, the City and the Paying Agent/Registrar shall not be required to transfer such
Certificate to an assignee of the registered owner within 45 days of the redemption date therefor,
provided, however, such limitation on transferability shall not be applicable to an exchange by
the registered owner of the unredeemed balance of a Certificate redeemed in part.
The Certificates are payable from the proceeds of an ad valorem tax levied, within the
limitations prescribed by law, upon all taxable property in the City and from a limited pledge of
the Net Revenues (as defined in the Ordinance) of the City's combined WaterwOrks and Sewer
System (the "System"), such pledge being limited to an amount not in excess of $500 and,
together with a parity pledge secudng the payment of the Previously Issued Certificates, being
junior and subordinate to the lien on and pledge of such Net Revenues securing the payment
of "Pdor Lien Obligations" (identified and defined in the Ordinance) now outstanding and
hereafter issued by the City. In the Ordinance, the City reserves and retains the dght to issue
Pnor Lien Obligations without limitation as to principal amount but subject to any applicable
terms, conditions or restrictions under law or otherwise.
Reference is hereby made to the Ordinance, a copy of which is on file in the Designated
Payment/Transfer Office of the Paying Agent/Registrar, and to all the provisions of which the
owner or holder of this Certificate by the acceptance hereof hereby assents, for definitions of
terms; the description of and the nature and extent of the tax levied for the payment of the
Certificates; the nature and extent of the limited pledge of the Net Revenues secudng the
payment of the Certificates; the terms and conditions relating to the transfer or exchange of this
Certificate; the conditions upon which the Ordinance may be amended or supplemented with or
without the consent of the Holders; the rights, duties, and obligations of the City and the Paying
Agent/Registrar; the terms and provisions upon which the tax levy and the pledge of the Net
Revenues and covenants made in the Ordinance may be discharged at or pdor to the matudty
of this Certificate, and this Certificate deemed to be no longer Outstanding thereunder; and for
the other terms and provisions contained therein. Capitalized terms used herein have the
meanings assigned in the Ordinance.
This Certificate, subject to certain limitations contained in the Ordinance, may be
transferred on the Security Register only upon its presentation and surrender at the Designated
Payment/Transfer Office of the Paying Agent/Registrar, with the Assignment hereon duly
endorsed by, or accompanied by a wdtten instrument of transfer in form satisfactory to the
Paying Agent/Registrar duly executed by, the registered owner hereof, or his duly authorized
agent. When a transfer on the Secudty Register occurs, one or more new fully registered
Certificates of the same Stated Maturity, of authorized denominations, beadng the same rate of
interest, and of the same aggregate principal amount will be issued by the Paying
Agent/Registrar to the designated transferee or transferees.
The City and the Paying Agent/Registrar, and any agent of either, shall treat the
registered owner whose name appears on the Secudty Register (i) on the Record Date as the
owner entitled to payment of interest hereon, (ii) on the date of surrender of this Certificate as
the owner entitled to payment of principal hereof at its Stated Maturity or its redemption, in who~e
or in part, and (iii) on any other date as the owner for all other purposes, and neither the City nor
the Paying Agent/Registrar, or any agent of either, shall be affected by notice to the contrary.
7616~0.1 -10-
In the event of nonpayment of interest on a scheduled payment date and for thirty (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 (which shall be 15 days after the Special Record Date)
shall be sent at least five (5) business days pdor to the Special Record Date by United States
Mail, first class postage prepaid, to the address of each Holder appearing on the Secudty
Register at the close of business on the last business day next preceding the date of mailing of
such notice.
It is hereby certified, recited, represented and declared that the City is a body corporate
and political subdivision duly organized and legally existing under and by virtue of the
Constitution and laws of the State of Texas; that the issuance of the Certificates is duly
authorized by law; that all acts, conditions and things required to exist and be done precedent
to and in the issuance of the Certificates to render the same lawful and valid obligations of the
City have been propedy done, have happened and have been performed in regular and due
time, form and manner as required by the Constitution and laws of the State of Texas, and the
Ordinance; that the Certificates do not exceed any Constitutional or statutory limitation; and that
due provision has been made for the payment of the principal of and interest on the Certificates
as aforestated. In case any provision in this Certificate shall be invalid, illegal, or unenforceable,
the validity, legality, and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby. The terms and provisions of this Certificate and the Ordinance
shall be construed in accordance with and shall be govemed by the laws of the State of Texas.
IN WITNESS WHEREOF, the City Council of the City has caused this Certificate to be
duly executed under the official seal of the City as of the Certificate Date.
CITY OF SOUTHLAKE, TEXAS
COUNTERSIGNED:
Mayor
City Secretary
(SEAL)
C. *Form of Reqistration Certificate of Comptroller
of Public Accounts to appear on Initial Certificate(s) only.
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER
OF PUBLIC ACCOUNTS
THE STATE OF TEXAS
REGISTER NO.
I HEREBY CERTIFY that this Certificate has been examined, certified as to validity and
approved by the Attorney General of the State of Texas, and duly registered by the Comptroller
of Public Accounts of the State of Texas.
WITNESS my signature and seal of office this
Comptroller of Public Accounts
of the State of Texas
(SEAL)
*NOTE TO PRINTER:
Do Not Pdnt on Definitive Certificates
D
Form of Certificate of Payin,q A.qent/Re.qistrar to
appear on Definitive Certificates only.
REGISTRATION CERTIFICATE OF PAYING AGENT/REGISTRAR
This Certificate has been duly issued and registered under the provisions of the
within-mentioned Ordinance; the certificate or certificates of the above entitled and designated
sedes originally delivered having been approved by the Attorney General of the State of Texas
and registered by the Comptroller of Public Accounts, as shown by the records of the Paying
Agent/Registrar.
The designated offices of the Paying Agent/Registrar located in Dallas, Texas, is the
"Designated Payment/Transfer Office" for this Certificate.
Registration Date:
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION,
as Paying Agent/Registrar
By
Authorized Signature
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E. Form of Assi,qnment.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns, and transfers unto
(Pdnt or typewnte name, address, and zip code of transferee:)
(Social Security or other identifying number:
) the within Certificate and all dghts thereunder, and hereby
irrevocably constitutes and appoints
attorney to transfer the within Certificate on the books kept for registration thereof, with full
power of substitution in the premises.
DATED:
Signature guaranteed:
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.
The Initial Certificate(s) shall be in the form set forth in paraqraph B of this Section,
except that the form of a single fully registered Initial Certificate shall be modified
as follows:
(i) immediately under the name of the certificate the headings "Interest Rate __
and "Stated Matudty __" shall both be omitted;
(ii) paragraph one shall read as follows:
Registered Owner:
Principal Amount:
Dollars
The City of Southlake (hereinafter referred to as the "City"), a body corporate and
municipal corporation in the Counties of Tarrant and Denton, State of Texas, for value received,
acknowledges itself indebted to and hereby promises to pay to the order of the Registered
Owner named above, orthe registered assigns thereof, the Principal Amount hereinabove stated
on February 15 in each of the years and in principal installments in accordance with the following
schedule:
PRINCIPAL INTEREST
YEAR INSTALLMENTS RATE
(Information to be inserted from schedule in Section 2 hereof).
(or so much thereof as shall not have been prepaid prior to maturity) and to pay interest on the
unpaid principal amounts hereof from the Certificate Date at the per annum rate(s) of interest
specified above computed on the basis of a 360-day year of twelve 30-day months; such interest
being payable on February 15 and August 15 of each year, commencing February 15, 2000.
Principal installments of this Certificate are payable at its Stated Matudty or on a prepayment
date to the registered owner hereof by Chase Bank of Texas, National Association (the "Paying
AgentYRegistrar"), upon presentation and surrender, at its designated offices in Dallas, Texas
(the "Designated Payment/Transfer Office"). Interest is payable to the registered owner of this
Certificate whose name appears on the "Security Register" maintained by the Paying
Agent/Registrar at the close of business on the "Record Date", which is the last business day of
the month next preceding each interest payment date hereof and interest shall be paid by the
Paying Agent/Registrar by check sent United States Mail, first class postage prepaid, to the
address of the registered owner recorded in the Secunty Register or by such other method,
acceptable to the Paying Agent/Registrar, requested by, and at the dsk and expense of, the
registered owner. All payments of principal of, premi_um, if any, and interest on this Certificate
shall be without exchange or collection charges to the owner hereof and in any coin or currency
of the United States of Amedca which at the time of payment is legal tender for the payment of
public and pdvate debts.
SECTION 10: Definitions. For purposes of this Ordinance and for cladtywith respect to
the issuance of the Certificates herein authorized, and the levy of taxes and appropriation of Net
Revenues therefor, the following words or terms, whenever the same appears herein without
qualifying language, are defined to mean as follows:
(a) The term "Certificates" shall mean the $17,030,000 "City of
Southlake, Texas, Tax and Waterworks and Sewer System (Limited Pledge)
Revenue Certificates of Obligation, Sedes 1999" authorized by this Ordinance.
(b) The term "Certificate Fund" shall mean the special Fund created
and established under the provisions of Section 1 1 of this Ordinance.
(c) The term "Collection Date" shall mean, when reference is being
made to the levy and collection of annual ad valorem taxes, the date the annual
ad valorem taxes levied each year by the City become delinquent.
(d) The term "Fiscal Year" shall mean the twelve month financial
accounting pedod used by the City in connection with the operation of the System
which may be any twelve consecutive month pedod established by the City.
(e) The term "Govemment Securities" shall mean direct obligations of
the United States of America, including obligations the principal of and interest
on which are unconditionally guaranteed by the United States of Amedca, and the
United States Treasury obligations such as its State and Local Government
Series in book-entry form
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(f) The term "Gross Revenues" shall mean all income, receipts and
revenues of every nature derived or received from the operation and ownership
(excluding refundable meter deposits, restricted gifts and grants in aid of
construction) of the System, including earnings and income dedved from the
investment or deposit of moneys in any special funds or accounts created and
established for the payment and secudty of the Pdor Lien Obligations payable
solely from the revenues of the System and other oDligations payable solely from
and secured only by a lien on and pledge of the Net Revenues.
(g) The term "Maintenance and Operating Expenses" shall mean all
current expenses of operating and maintaining the System, including all salaries,
labor, materials, repairs and extensions necessary to render efficient service;
provided, however, that only such repairs and extensions, as in the judgment of
the City Council, reasonably and faidy exercised, are necessary to maintain the
operations and render adequate service to th_e City and the inhabitants thereof,
or such as might be necessary to meet some physical accident or condition which
would otherwise impair obligations payable from Net Revenues shall be deducted
in determining "Net Revenues". Depreciation charges shall not be considered
Maintenance and Operating Expenses. Maintenance and Operating Expenses
shall include payments under contracts for the purchase of water supply,
treatment of sewage or other materials, goods, services, or facilities for the
System to the extent authorized by law and the provisions of such contract.
(h) The term "Net Revenues" shall mean the Gross Revenues of the
System, with respect to any pedod, after deducting the System's Maintenance
and Operating Expenses dunng such pedod.
(i) The term "Outstanding" when used in this Ordinance with respect
to Certificates means, as of the date of determination, all Certificates theretofore
issued and delivered under this Ordinance, except:
(1) those Certificates cancelled by the Paying
Agent/Registrar or delivered to the Paying Agent/Registrar for
cancellation;
(2) those Certificates for which payment has been duly
provided by the City in accordance with the provisions of
Section 20 hereof; and
(3) those Certificates that have been mutilated,
destroyed, lost, or stolen and replacement Certificates have been
registered and delivered in lieu thereof as provided in Section 19
hereof.
(j) The term "Previously Issued Certificates" shall mean the outstanding
"City of Southlake, Texas, Tax and Waterworks and Sewer System (Limited
Pledge) Revenue Certificates of Obligation, Sedes 1990", dated August 1, 1990,
issued in the odginal principal amount of $1,100,000, (2) "City of Southlake,
Texas, Tax and Waterworks and Sewer System (Limited Pledge) Revenue
Certificates of Obligation, Series 1992", dated May 1, 1992, issued in the odginal
principal amount of $1,300,000, (3) "City of Southlake, Texas, Tax and
Waterworks and Sewer System (Limited Pledge) Revenue Certificates of
Obligation, Sedes 1994", dated December 1, 1994, originally issued in the
principal amount of $4,350,000, (4) "City of Southlake, Texas, Tax and
Waterworks and Sewer System (Limited Pledge) Revenue Certificates of
Obligation, Sedes 1996", dated February 15, 1996, originally issued in the
principal amount of $2,380,000, (5) "City of Southlake, Texas, Tax and
Waterworks and Sewer System (Limited Pledge) Revenue Certificates of
Obligation, Sedes 1997", dated February 15, 1997, originally issued in the
principal amount of $9,670,000 and (6) "City of Southlake, Texas, Tax and
Waterworks and Sewer System (Limited Pledge) Revenue Certificates of
Obligation, Sedes 1998", dated May 15, 1998, originally issued in the principal
amount of $13,910,000.
(k) The term "Prior Lien Obligations" shall mean (i) the outstanding
and unpaid (1) "City of Southlake, Texas, Waterworks and Sewer System
Revenue Bonds, Sedes 1984", dated May 1, 1984, originally issued in the
aggregate principa~ amount of $500,000, (2) "City of Southlake, Texas,
Waterworks and Sewer System Revenue Refunding Bonds, Sedes 1987", dated
March 1, 1987, and originally issued in the aggregate principal amount of
$217,000 and (3) "City of Southlake, Texas, Tax and Waterworks and Sewer
System Surplus Revenue Certificates of Obligation, Sedes 1992-A", dated
October 1, 1992, and originally issued in the aggregate principal amount of
$1,300,000, and (ii) obligations hereafter issued which by the terms of the
authorizing ordinance are made payable from and secured by a lien on and
pledge of the Net Revenues of the System ranking pdor and supedor to the lien
and pledge secudng the payment of the Certificates.
(I) The term "System" shall mean all properties, facilities and plants
currently owned, operated and maintained by the City for the supply, treatment,
transmission and distribution of treated potable water and the collection,
treatment and disposal of water-carded wastes, together with all future
extensions, improvements, replacements and additions thereto.
SECTION 11: Certificate Fund. For the purpose of paying the interest on and to provide
a sinking fund for the payment, redemption and retirement of the Certificates, there shall be and
is hereby created a special account or fund on the books and records of the City known as the
"SPECIAL SERIES 1999 TAX AND REVENUE CERTIFICATE OF OBLIGATION FUND", and all
m0neys deposited to the credit of such Fund shall be shall be kept and maintained in a special
banking account at the City's depository bank. Authorized officials of the City are hereby
authorized and directed to make withdrawals from said Fund sufficient to pay the principal of and
interest on the Certificates as the same become due and payable, and, shall cause to be
transferred to the Paying Agent/Registrar from moneys on deposit in the Certificate Fund an
amount sufficient to pay the amount of principal and/or interest falling due on the Certificates,
such transfer of funds to the Paying Agent/Registrar to be made in such manner as will cause
~mmediately available funds to be deposited with the Paying Agent~Registrar on or before the
last business day next preceding each interest and principal payment date for the Certificates.
Pending the transfer of funds to the Paying Agent/Registrar, money in the Certificate
Fund may, at the option of the City, be invested in obligations identified in, and in accordance
with the provisions of the "Public Funds Investment Act" (V.T.C.A., Government Code, Chapter
2256) relating to the investment of "bond proceeds"; provided that all such investments shall be
made in such a manner that the money required to be expended from said Fund will be available
at the proper time or times. All interest and income derived from deposits and investments in
said Certificate Fund shall be credited to, and any losses debited to, the said Certificate Fund.
All such investments shall be sold promptly when necessan] to prevent any default in connection
with the Certificates.
SECTION 12: TaxLevy. To provide forthe paymentofthe"DebtService Requirements"
on the Certificates being (i) the interest on said Certificates and (ii) a sinking fund for their
redemption at maturity or a sinking fund of 2% (whichever amount shall be the greater), there
shall be and there is hereby levied for the current year and each succeeding year thereafter
while said Certificates or any interest thereon shall remain Outstanding, a sufficient tax on each
one hundred dollars' valuation of taxable property in said City, adequate to pay such Debt
Service Requirements, full allowance being made for delinquencies and costs of collection; said
tax shall be assessed and collected each year and applied to the payment of the Debt Service
Requirements, and the same shall not be diverted to any other purpose. The taxes so levied and
collected shall be paid into the Certificate Fund. The City Council hereby declares its purpose
and intent to provide and levy a tax legally and fully sufficient to pay the said Debt Service
Requirements, it having been determined that the existing and available taxing authority of the
City for such purpose is adequate to permit a legally sufficient tax in consideration of all other
outstanding indebtedness.
Accrued interest and premium, if any, received from the purchasers of the Certificates
shall be deposited to the Certificate Fund. In addition, any surplus proceeds from the sale of the
Certificates not expended for authorized purposes shall be deposited in the Certificate Fund, and
such amounts so deposited shall reduce the sums otherwise required to be deposited in said
Fund from ad valorem taxes.
SECTION 13: Limited Pledqe of Net Revenues. The City hereby covenants and agrees
that, subject to the pdor lien on and pledge of the Net Revenues of the System to the payment
and secudty of Pdor Lien Obligations, the Net Revenues of the System in an aggregate amount
not to exceed $500 are hereby irrevocably pledged to the payment of the principal of and interest
on the Certificates, and the limited pledge of $500 of the Net Revenues of the System herein
made for the payment of the Certificates shall constitute a lien on the Net Revenues of the
System in accordance with the terms and provisions hereof and shall be on a padty in all
respects with the lien on the Net Revenues secudng the payment of the Previously Issued
Certificates. Furthermore, such lien on and pledge of the Net Revenues secudng the payment
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of the Certificates shall be valid and binding without further action by the City and without any
filing or recording except for the filing of this Ordinance in the records of the City.
SECTION 14: System Fund. The City covenants and agrees that all Gross
Revenues (excluding earnings from the investment of money held in any special funds or
accounts created for the payment and secudty of the Prior Lien Obligations) shatl be deposited
as collected into a fund maintained at an official depository of the City and known on the books
of the City as the "City of Southlake Waterworks and Sanitary Sewer System Fund" (hereinafter
called the "System Fund"). All moneys deposited to the credit of the System Fund shall be
allocated, appropriated and budgeted to the extent required for the following purposes and in
the order of pdodty shown, to wit:
First: To the payment of all necessary and reasonable Maintenance and
Operating Expenses of the System as defined herein or required by statute to be
a first charge on and claim against the GrossRevenues,
Second: To the payment of all amounts required to be deposited in
the special Funds created and established for the payment, security and benefit
of Pdor Lien Obligations in accordance with the terms and provisions of the
ordinances authorizing the issuance of Pdor Lien Obligations.
Third: To the payment, equally and ratably, of the limited amounts
pledged to the payment of the Previously Issued Certificates and the Certificates.
Any Net Revenues remaining in the System Fund after satisfying the foregoing payments,
or making adequate and sufficient provision for the payment thereof, may be appropriated and
used for any other City purpose now or hereafter permitted by law.
SECTION 15: Security of Funds. All moneys on deposit in the Funds for which this
Ordinance makes provision (except any portion thereof as may be at any time propedy invested)
shall be secured in the manner and to the fullest extent required by the laws of Texas for the
secudty of public funds, and moneys on deposit in such Funds shall be used only for the
purposes permitted by this Ordinance.
SECTION 16: Special Covenants. The City hereby further covenants as follows:
(a) It has the lawful power to pledge the Net Revenues of the System
to the payment of the Certificates in the manner herein contemplated and has
lawfully exercised such power under the Constitution and laws of the State of
Texas, including said power existing under Articles 1111 et seq., V.A.T.C.S. and
V.T.C.A., Local Govemment Code, Sections 271.041, et seq.
Ih) Other than for the payment of the Certificates, the Previously
Issued Certificates and the Pdor Lien Obligations, the Net Revenues of the
System have not in any manner been pledged to the payment of any debt or
obligation of the City or of the System.
SECTION 17: Issuance of Prior Lien Obli,qations/Additional Padty Obligations. The City
hereby expressly reserves the dght to hereafter issue Pdor Lien Obligations, without limitation
as to principal amount but subject to any terms, conditions or restrictions applicable thereto
under law or otherwise, and such Pdor Lien Obligations hereafter issued may be payable, in
whole or in part, from the Net Revenues (without impairment of the obligation of contract with the
Holders of the Certificates) upon such terms and secured in such manner as the City Council
may determine Additionally, the City reserves the right without any limitations or restrictions to
issue additional obligations payable (in whole or in part) from and secured by lien on and pledge
of the Net Revenues of the System of equal rank and dignity with the lien on and pledge of such
Net Revenues securing the payment of the Previously Issued Certificates and the Certificates.
SECTION 18: Application of Pnor Lien Obliqations Covenants and Aqreements. It is the
intention of this governing body and accordingly hereby recognized and stipulated that the
provisions, agreements and covenants contained herein bearing upon the management and
operations of the System, and the administering and-application of revenues dedved from the
operation thereof, shall to the extent possible be harmonized with like provisions, agreements
and covenants contained in the ordinances authorizing the issuance of the Pdor Lien
Obligations, and to the extent of any irreconcilable conflict between the provisions contained
herein and in the ordinances authorizing the issuance of the Prior Lien Obligations, the
provisions, agreements and covenants contained therein shall prevail to the extent of such
conflict and be applicable to this Ordinance but in all respects subject to the pdodty of rights and
benefits, if any, conferred thereby to the holders of the Pdor Lien Obligations. Notwithstanding
the above, any change or modification affecting the application of revenues dedved from the
operation of the System shall not impair the obligation of contract with respect to the limited
pledge of revenues herein made for the payment and secudty of the Certificates.
SECTION 19: Mutilated - Destroyed - Lost and Stolen Certificates. In case any
Certificate shall be mutilated, or destroyed, lost or stolen, the Paying Agent/Registrar may
execute and deliver a replacement Certificate of like form and tenor, and in the same
denomination and bearing a number not contemporaneously outstanding, in exchange and
substitution for such mutilated Certificate, or in lieu of and in substitution for such destroyed, lost
or stolen Certificate, only upon the approval of the City and after (i) the filing by the Holder
thereof with the Paying Agent/Registrar of evidence satisfactory to the Paying Agent/Registrar
of the destruction, loss or theft of such Certificate, and of the authenticity of the ownership
thereof and (ii) the fumishing to the Paying Agent/Registrar of indemnification in an amount
satisfactory to hold the City and the Paying Agent/Registrar harmless. All expenses and charges
associated with such indemnity and with the preparation, execution and delivery of a
replacement Certificate shall be borne by the Holder of the Certificate mutilated, or destroyed,
lost or stolen.
Every replacement Certificate issued pursuant to this Section shall be a valid and binding
obligation, and shall be entitled to all the benefits of this Ordinance equally and ratably with all
other Outstanding Certificates; notwithstanding the enforceability of payment by anyone of the
destroyed, lost, or stolen Certificates. The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other dghts and remedies with respect to the replacement and
payment of mutilated, destroyed, lost or stolen Certificates.
SECTION 20: Satisfaction of Obliqation of City. If the City shall pay or cause to be paid,
or there shall otherwise be paid to the Holders, the principal of, premium, if any, and interest on
the Certificates, at the times and in the manner stipulated in this Ordinance, then the pledge of
taxes levied under this Ordinance and the Net Revenues of the System (to the extent such
limited pledge of Net Revenues shall not have been discharged or terminated by pdor payment
of pnncipal of or interest on the Certificates) and all covenants, agreements, and other
obligations of the City to the Holders shall thereupon cease, terminate, and be discharged and
satisfied.
Certificates or any principal amount(s) thereof shall be deemed to have been paid within
the meaning and with the effect expressed above in this Section when (i) money sufficient to pay
in full such Certificates or the pnncipal amount(s) thereof at matudty or the redemption date
therefor, together with all interest due thereon, shall have been irrevocably deposited with and
held in trust by the Paying Agent/Registrar, or an authorized escrow agent, or (ii) Government
Securities shall have been irrevocably deposited in trust with the Paying Agent/Registrar, or an
authorized escrow agent, which Government SecudtFes have been certified by an independent
accounting firm to mature as to principal and interest in such amounts and at such times as will
insure the availability, without reinvestment, of sufficient money, together with any moneys
deposited therewith, if any, to pay when due the principal of and interest on such Certificates,
or the pnncipal amount(s) thereof, on and pdor to the Stated Matudty thereof or (if notice of
redemption has been duly given or waived or if irrevocable arrangements therefor acceptable
to the Paying Agent/ Registrar have been made) the redemption date thereof. The City
covenants that no deposit of moneys or Government Securities will be made under this Section
and no use made of any such deposit which would cause the Certificates to be treated as
"arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as
amended, or regulations adopted pursuant thereto.
Any moneys so deposited with the Paying Agent/Registrar, or an authorized escrow
agent, and all income from Government Securities held in trust by the Paying Agent/Registrar,
or an authorized escrow agent, pursuant to this Section which is not required for the payment
of the Certificates, or any principal amount(s) thereof, or interest thereon with respect to which
such moneys have been so deposited shall be remitted to the City or deposited as directed by
the City. Furthermore, any money held by the Paying Agent/Registrar for the payment of the
principal of and interest on the Certificates and remaining unclaimed for a pedod of four (4) years
after the Stated Maturity, or applicable redemption date, of the Certificates such moneys were
deposited and are held in trust to pay shall upon the request of the City be remitted to the City
against a wdtten receipt therefor. NobNithstanding the above and foregoing, any remittance of
funds from the Paying Agent/Registrar to the City shall be subject to any applicable unclaimed
property laws of the State of Texas.
SECTION 21: Ordinance a Contract-Amendments. This Ordinance shall constitute a
contract with the Holders from time to time, 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 the consent of or notice to any Holders, from time to time and
at any time, amend this Ordinance in any manner not detrimental to the interests of the Holders,
including the cunng of any ambiguity, inconsistency, or formal defect or omission herein. In
7~1ii30 i -20-
addition, the City may, with the consent of Holders holding a majodty in aggregate principal
amount of the Certificates then Outstanding affected thereby, amend, add to, or rescind any of
the provisions of this Ordinance; provided that, without the consent of all Holders of Outstanding
Certificates, no such amendment, addition, or rescission shall (1) extend the time or times of
payment of the principal of, premium, if any, and interest on the Certificates, reduce the principal
amount thereof, the redemption pdce, or the rate of interest thereon, or in any other way modify
the terms of payment of the principal of, premium, if any, or interest on the Certificates, (2) give
any preference to any Certificate over any other Certificate, or (3) reduce the aggregate principal
amount of Certificates required to be held by Holders for consent to any such amendment,
addition, or rescission.
SECTION 22: Covenants to Maintain Tax-Exempt Status. (a)
When used in this Section, the following terms have the following meanings:
Definitions.
"Closing Date" means the date on which the Certificates are first
authenticated and delivered to the initial purchasers against payment therefor.
"Code" means the Internal Revenue Code of 1986, as amended by all
legislation, if any, effective on or before the Closing Date.
"Computation Date"has the meaning set forth in Section 1.148-1(b) of the
Regulations.
"Gross Proceeds" means any proceeds as defined in Section 1.148-1 (b)
of the Regulations, and any replacement proceeds as defined in Section
1.148-1(c) of the Regulations, of the Certificates.
"Investment" has the meaning set forth in Section 1.148-1(b) of the
Regulations.
"Nonpurpose Investment" means any investment property, as defined in
section 148(b) of the Code, in which Gross Proceeds of the Certificates are
invested and which is not acquired to carry out the governmental purposes of the
Certificates.
"Rebate Amount" has the meaning set forth in Section 1.148-1(b) of the
Regulations.
"Regulations" means any proposed, temporary, or final Income Tax
Regulations issued pursuant to Sections 103 and 141 through 150 of the Code,
and 103 of the Internal Revenue Code of 1954, which are applicable to the
Certificates. Any reference to any specific Regulation shall also mean, as
appropriate, any proposed, temporary or final Income Tax Regulation designed
tO supplement, emend or replace the specific Regulation referenced.
"Yield" of (1) any Investment has the meaning set forth in Section 1.148-5
of the Regulations and (2) the Certificates has the meaning set forth in Section
1.148-4 of the Regulations.
(b) 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)
~n 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 receives 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 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.
(c) No Private Use or Pdvate Payments. Except as permitted by section 141 of the
Code and the Regulations and rulings thereunder, the City shall at all times pdor to the last
Stated Matudty of Certificates:
(1) exclusively own, operate and possess all property the acquisition,
construction or improvement of which is to be financed or refinanced directly or
indirectly with Gross Proceeds of the Certificates, and not use or permit the use
of such Gross Proceeds (inctuding all contractual arrangements with terms
different than those applicable to the general public) or any property acquired,
constructed or improved with such Gross Proceeds in any activity carded on by
any person or entity (including the United States or any agency, department and
instrumentality thereof) other than a state or local government, unless such use
is solely as a member of the general public; and
(2) not directly or indirectly impose or accept any charge or other
payment by any person or entity who is treated as using Gross Proceeds of the
Certificates or any property the acquisition, construction or improvement of which
is to be financed or refinanced directly or indirectly with such Gross Proceeds,
other than taxes of general application within the City or interest earned on
investments acquired with such Gross Proceeds pending application for their
intended purposes.
(d) 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 the Certificates
to make or finance loans to any person or entity other than a state or local government. For
purposes of the foregoing covenant, such Gross Proceeds are considered to be "loaned" to a
person or entity if: (1) property acquired, constructed or improved with such 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 any property acquired, constructed or
improved with such Gross Proceeds are otherwise transferred in a transaction which is the
economic equivalent of a loan.
(e) Not to Invest at Hiqher 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 pdor to the final
Stated Matunty of the Certificates directly or indirectly invest Gross Proceeds in any Investment
(or use Gross Proceeds to replace money so invested), if as a result of such investment the Yield
from the Closing Date of alt Investments acquired with Gross Proceeds (or with money replaced
thereby), whether then held or previously disposed of, exceeds the Yield of the Certificates.
(f) 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.
(g) Information Report. The City shall timely file the information required by section
149(e) of the Code with the Secretary of the Treasury on Form 8038-G or such other form and
in such place as the Secretary may prescribe.
(h) Rebate of Arbitraqe Profits. Except to the extent otherwise provided in section
148(0 of the Code and the Regulations and rulings thereunder:
(1) The City shall 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 accounting for at least six years after the day on
which the last Outstanding Certificate is discharged. However, to the extent
permitted by law, the City may commingle Gross Proceeds of the Certificates with
other money of the City, provided that the City separately accounts for each
receipt and expenditure of Gross Proceeds and the obligations acquired
therewith.
(2) Not less frequently than each Computation Date, the City shall
calculate the Rebate Amount in accordance with rules set forth in section 148(f)
of the Code and the Regulations and rulings thereunder. The City shall maintain
such calculations with its official transcript of proceedings relating to the issuance
of the Certificates until six years after the final Computation Date.
(3) As additional consideration for the purchase of the Certificates by the
Purchasers and the loan of the money represented thereby and in order to induce
such purchase by measures designed to insure the excludability of the interest
thereon from the gross income of the owners thereof for federal income tax
purposes, the City shall pay to the United States out of the Certificate Fund or its
general fund, as permiffed by applicable Texas statute, regulation or opinion of
the Attorney General of the State of Texas, the amount that when added to the
future value of previous rebate payments made for the Certificates equals (i) in
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the case of a Final Computation Date as defined in Section 1.148-3(e)(2) of the
Regulations, one hundred percent (100%) of the Rebate Amount on such date;
and (ii) in the case of any other Computation Date, ninety percent (90%) of the
Rebate Amount on such date. In all cases, the rebate payments shall be made
at the times, in the installments, to the place and in the manner as is or may be
required by section 148(f) of the Code and the Regulations and rulings
thereunder, and shall be accompanied by Form 8038-T or such other forms and
information as is or may be required by Section 148(f) of the Code and the
Regulations and rulings thereunder.
(4) The City shall exercise reasonable diligence to assure that no errors
are made in the calculations and payments required by paragraphs (2) and (3),
and if an error is made, to discover and promptly correct such error within a
reasonable amount of time thereafter (and in all events within one hundred eighty
(180) days after discovery of the error), including payment to the United States
of any additional Rebate Amount owed to it, interest thereon, and any penalty
imposed under Section 1.148-3(h) of the Regulations.
(i) Not to Divert Arbitraqe Profits. Except to the extent permitted by section 148 of
the Code and the Regulations and rulings thereunder, the City shall not, at any time pdor to the
eadier of the Stated Matudty or final payment of the Certificates, 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 sma!let 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.
(j) Elections. The City hereby directs and authorizes the Mayor, City Secretary, City
Manager and Director of Finance, individually or jointly, to make elections permitted or required
pursuant to the provisions of the Code or the Regulations, as they deem necessary or
appropriate in connection with the Certificates, in the Certificate as to Tax Exemption or similar
or other appropriate certificate, form or document.
SECTION 23: Sale of Certificates - Official Statement Approval. The Certificates
authorized by this Ordinance are hereby sold by the City to J.P. Morgan Securities Inc. and
Morgan Keegan & Company, Inc. (herein referred to as the "Purchasers") in accordance with the
Purchase Contract, dated Apdl 6, 1999, attached hereto as Exhibit B and incorporated herein
by reference as a part of this Ordinance for all purposes. The Mayor is hereby authorized and
directed to execute said Purchase Contract for and on behalf of the City and as the act and deed
of this Council, and in regard to the approval and execution of the Purchase Contract, the
Council hereby finds, determines and declares that the representations, warranties and
agreements of the City (contained therein) are true and correct in all matedal respects and shall
be honored and performed by the City.
Furthermore, the use of the Official Stateme,~t by the Purchasers in connection with the
public offehng and sale of the Certificates is hereby ratified, confirmed and approved in all
respects. The final Official Statement, which reflects the terms of sale, attached as exhibit A to
the Purchase Contract (together with such changes approved by the Mayor, City Manager,
Director of Finance or City Secretary, individually or jointly), shall be and is hereby in all respects
approved, and the Purchasers are hereby authorized to use and distribute said final Official
Statement, dated April 6, 1999, in the reoffedng, sale and delivery of the Certificates to the
public. The Mayor and City Secretary are further authorized and directed to manually execute
and deliver for and on behalf of the City copies of said Official Statement in final form as may
be required by the Purchasers, and such final Official Statement in the form and content
manually executed by said officials shall be deemed to be approved by the City Council and
constitute the Official Statement authorized for distribution and use by the Purchasers.
SECTION 24: Proceeds of Sale. The proceeds of sale of the Certificates, excluding the
accrued interest and premium, if any, received from the Purchasers, shall be deposited in a
construction fund maintained at the City's depository bank. Pending expenditure for authorized
projects and purposes, such proceeds of sale may be invested in authorized investments and
any investment earnings realized may be expended for such authorized projects and purposes
or deposited in the Certificate Fund as shall be detemli~ed by the City Council. Accrued interest
and premium, if any, as well as all surplus proceeds of sale of the Certificates, including
investment earnings, remaining after completion of ail authorized projects or purposes shall be
deposited to the credit of the Certificate Fund.
SECTION 25: Control and Custody of Certificates. The Mayor of the City shall be and
is hereby authonzed to take and have charge of all necessary orders and records pending the
sale of the Certificates, the investigation by the Attomey General of the State of Texas, including
the pdnting and supply of definitive Certificates, and shall take and have charge and control of
the initial Certificate(s) pending the approval thereof by the Attorney General, the registration
thereof by the Comptroller of Public Accounts and the delivery thereof to the Purchasers.
Furthermore, the Mayor, City Secretary, Director of Finance and City Manager, any one
or more of said officials, are hereby authorized and directed to furnish and execute such
documents and certifications relating to the City and the issuance of the Certificates, including
a certification as to facts, estimates, circumstances and reasonable expectations pertaining to
the use and expenditure and investment of the proceeds of the Certificates as may be necessary
for the approval of the Attomey General and their registration by the Comptroller of Public
Accounts. In addition, such officials, togetherwith the City's financial advisor, bond counsel and
the Paying Agent/Registrar, are authorized and directed to make the necessary arrangements
for the delivery of the Initial Certificate(s) to the Purchasers and the initial exchange thereof for
definitive Certificates.
SECTION 26: Notices to Holders-Waiver. Wherever this Ordinance provides for notice
to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in wdting and sent by United States Mail, first class postage prepaid, to the address
of each Holder appearing in the Secudty Register at the close of business on the business day
next preceding the mailing of such notice.
In any case where notice to Holders is given by mail, neither the failure to mail such
notice to any particular Holders, nor any defect in any notice so mailed, shall affect the
sufficiency of such notice with respect to all other Certificates. Where this Ordinance provides
for notice in any manner, such notice may be waived in wnting by the Holder entitled to receive
such notice, either before or after the event with respect to which such notice is given, and such
waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Paying Agent/Registrar, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
SECTION 27: Cancellation. All Certificates surrendered for payment, redemption,
transfer, exchange, or replacement, if surrendered to the Paying Agent/Registrar, shall be
promptly cancelled by it and, if surrendered to the City, shall be delivered to the Paying
Agent/Registrar and, if not already cancelled, shall be promptly cancelled by the Paying
Agent/Registrar. The City may at any time deliver to the Paying Agent/Registrar for cancellation
any Certificates previously certified or registered and delivered which the City may have acquired
in any manner whatsoever, and all Certificates so delivered shall be prompUy cancelled by the
Paying Agent/Registrar. All cancelled Certificates held by the Paying Agent/Registrar shall be
returned to the City.
SECTION 28: Bond Counsel's Opinion. The Purchasers' obligation to accept delivery
of the Certificates is subject to being furnished a final opinion of Fulbdght & Jaworski L. LP.,
Dallas, Texas, approving the Certificates as to their validity, said opinion to be dated and
delivered as of the date of delivery and payment for the Certificates. An executed counterpart
of said opinion shall accompany the global certificates deposited with The Depository Trust
Company or a reproduction thereof shall be printed on the definitive Certificates in the event the
book entry only system shall be discontinued.
SECTION 29: CUSIP Numbers. CUSIP numbers may be pdnted or typed on the
definitive Certificates. It is expressly provided, however, that the presence or absence of CUSIP
numbers on the definitive Certificates shall be of no significance or effect as regards the legality
thereof and neither the City nor attorneys approving the Certificates as to legality are to be held
responsible for CUSIP numbers incorrectly printed or typed on the definitive Certificates.
SECTION 30: Benefits of Ordinance. Nothing in this Ordinance, expressed or implied,
is intended or shall be construed to confer upon any person other than the City, the Paying
Agent/Registrar and the Holders, any dght, remedy, or claim, legal or equitable, under or by
reason of this Ordinance or any provision hereof, and this Ordinance and all its provisions is
intended to be and shall be for the sole and exclusive benefit of the City, the Paying
Agent/Registrar and the Holders.
SECTION 31: Inconsistent Provisions. All ordinances, orders or resolutions, or parts
thereof, which are in conflict or inconsistent with any provision of this Ordinance are hereby
repealed to the extent of such conflict, and the provisions of this Ordinance shall be and remain
controlling as to the matters contained herein.
SECTION 32: Govemin,q Law. This Ordinance shall be construed and enforced in
accordance with the laws of the State of Texas and the United States of Amedca.
SECTION 33: Effectof Headings. The Section headings herein are forconvenience only
and shall not affect the construction hereof.
SECTION 34: Construction of Terms. If appropriate in the context of this Ordinance,
words of the singular number shall be considered to include the plural, words of the plural
number shall be considered to include the singular, and words of the masculine, feminine or
neuter gender shall be considered to include the other genders.
SECTION 35: Severability. If any provision of this Ordinance or the application thereof
to any circumstance shall be held to be invalid, the remainder of this Ordinance and the
application thereof to other circumstances shall nevertheless be valid, and the City Council
hereby declares that this Ordinance would have been enacted without such invalid provision.
SECTION 36: Continuinq Disclosure Undertakinq. (a) Definitions. As used in this
Section, the following terms have the meanings ascribed to such terms below:
"MSRB" means the Municipal Securities Rulemaking Board.
"NRMSIF?' means each person whom the SEC or its staff has determined to be
a nationally recognized municipal securities information repository within the meaning of the Rule
from time to time.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC' means the United States Securities and Exchange Commission.
"SID" means any person designated by the State of Texas or an authorized
department, officer, or agency thereof as, and determined by the SEC or its staff to be, a state
information depository within the meaning of the Rule from time to time.
(b) Annual Reports. The City shall provide annually to each NRMSIR and any SID,
within six months after the end of each fiscal year (beginning with the fiscal year ending
September 30, 1999) financial information and operating data with respect to the City of the
general type included in the final Official Statement approved by Section 23 of this Ordinance,
being the information described in Exhibit C hereto. Financial statements to be provided shall
be (1) prepared in accordance with the accounting principles described in Exhibit C hereto and
(2) audited, if the City commissions an audit of such statements and the audit is completed within
the pedod during which they must be provided. If audited financial statements are not available
at the time the financial information and operating data must be provided, then the City shall
provide unaudited financial statements for the applicable fiscal year to each NRMSIR and any
SID with the financial information and operating data and will file the annual audit report, when
and if the same becomes available.
if the City changes its fiscal year, it will notify each NRMSIR and any SID of the
change (and of the date of the new fiscal year end) pdor to the next date by which the City
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otherwise would be required to provide financial information and operating data pursuant to this
Section.
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
reference to any document (including an official statement or other offedng document, if it is
available from the MSRB) that theretofore has been provided to each NRMSIR and any SID or
filed with the SEC.
(c) Matedal Event Notices. The City shall notify any SID and either each NRMSIR
or the MSRB, in a timely manner, of any of the following events with respect to the Certificates,
if such event is matedal within the meaning of the federal securities laws:
2.
3.
difficulties;
4.
5.
6.
Certificates;
7.
8.
9.
10.
Principal and interest payment delinquencies;
Non-payment related defaults;_
Unscheduled draws on debt service reserves reflecting financial
Unscheduled draws on credit enhancements reflecting financial difficulties;
Substitution of credit or liquidity providers, or their failure to perform;
Adverse tax opinions or events affecting the tax-exempt status of the
Modifications to dghts of holders of the Certificates;
Certificate calls;
Defeasances;
Release, substitution, or sate of property secudng repayment of the
Certificates; and
11. Rating changes.
The City shall notify any SID and either each NRMSIR or the MSRB, in a timely
manner, of any failure by the City to provide financial information or operating data in accordance
with subsection (b) of this Section by the time required by such Section.
(d) Limitations, Disclaimers, andAmendments. The City shall be obligated to observe
and perform the covenants specified in this Section while, but only while, 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 the notice required by subsection (c) hereof of any Certificate calls and
defeasance that cause the City to be no longer such an "obligated person."
The provisions of this Section are for the sole benefit of the Holders and beneficial
owners of the Certificates, and nothing in this Section, express or implied, shall give any benefit
or any legal or equitable dght, 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 Section 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 Section 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 HOLDER
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 SECTION, 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.
No default by the City in observing or performing its obligations under this Section
shall constitute a breach of or default under this Ordinance for purposes of any other provision
of this Ordinance.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit
the duties of the City under federal and state securities laws.
The provisions of this Section may be amended by the City from time to time to
adapt to changed circumstances resulting 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 (1) the
provisions of this Section, as so amended, would have permitted underwriters to purchase or sell
Certificates in the pdmary offedng 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 (2) either (a) the Holders of a majodty in aggregate
principal amount (or any greater amount required by any other provision of this Ordinance that
authorizes such an amendment) of the Outstanding Certificates consent to such amendment or
(b) a 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 Holders and
beneficial owners of the Certificates. The provisions of this Section may also be amended from
time to time or repealed by the City if the SEC amends or repeals the applicable provisions of
the Rule or a court of final jurisdiction determines that such provisions are invalid, but only if and
to the extent that reservation of the City's dght to do so would not prevent underwriters of the
initial public offering of the Certificates from lawfully purchasing or selling Certificates in such
offedng. If the City so amends the provisions of this Section, it shall include with any amended
financial information or operating data next provided in accordance with subsection (b) an
explanation, in narrative form, of the reasons for the amendment and of the impact of any
change in the type of financial information or operating data so provided.
SECTION 37: Insurance. The Certificates have been offered and sold with the principal
of and interest thereon being insured by AMBAC Assurance Corporation (hereinafter called
"AMBAC") pursuant to a Municipal Bond Insurance Policy. In accordance with the terms and
conditions applicable to insurance provided by AMBAC, the City covenants and agrees that, in
the event the principal and interest due on the Certificates shall be paid by AMBAC pursuant to
the policy referred to this Section, the assignment and pledge of all funds and all covenants,
agreements and other obligations of the City to the Holders shall continue to exist and AMBAC
shall be subrogated to the rights of such Holders; and furthermore, the City covenants and
agrees that:
(a) Consent of AMBAC where Holder Consent Required. AMBAC
shall be deemed to be the holder of the Certificates insured by AMBAC at all
times for the purpose of the execution and delivery of any amendment, change
or modification of this Ordinance or the initiation by Holders of any action to be
taken under this Ordinance at the Holder's request, which under this Ordinance
(or under such underlying documents requires the wdtten approval or consent of
or can be initiated by the Holders of a majodty (50% percent) in aggregate
principal amount of the Certificates at the time Outstanding.
(b) Defeasance. In the event that the principal and redemption price,
if applicable, and interest due on the Certificates shall be paid by AMBAC
pursuant to the policy referred to in this Section, all covenants, agreements and
other obligations of the City to the Holders shall continue to exist and AMBAC
shall be subrogated to the dghts of such Holders.
(c) Notices to be Given to AMBAC While the Municipal Bond Guaranty
Insurance Policy is in effect, the City shall furnish to AMBAC:
(1) as soon as practicable after the filing thereof, a copy
of any financial statement of the City and a copy of any audit and
annual report of the City;
(2) a copy of any notice to be given to the registered
owners of the Certificates, including, without limitation, notice of
any redemption or defeasance of Certificates, and any certificate
rendered pursuant to this Ordinance relating to the secudty for the
Certificates; and
(3) such additional information as it may reasonably
request.
The City will permit AMBAC to discuss the affairs, finances and accounts
of the City, or any information AMBAC may reasonably request regarding the
secudty for the Certificates with appropriate officers of the City. The City will
permit AMBAC to have access to and make copies of all books and records
relating to the Certificates at any reasonable time.
761~0.1 -50-
(d) Consent of AMBAC. Any provision of this Ordinance expressly
recognizing or granting dghts in or to AMBAC may not be amended in any
manner which affects the dghts of AMBAC hereunder without the pdor written
consent of AMBAC. Furthermore, anything in this Ordinance to the contrary
notwithstanding, upon the occurrence and continuance of an event of default,
AMBAC shall be entitled to control and direct the enforcement of all rights and
remedies granted to the Holders of the Certificates for the benefit of such
Holders
(e) Conceminq the Bond insurance Policy. As long as insurance for
the Certificates shall be in full force and effect, the City agrees to comply with the
following provisions:
(1) if five (5) days pdor to an interest payment date for the
Certificates the City determines that there will be insufficient funds
in the Certificate Fund to pay the pdn-cipal of or interest on the
Certificates on such interest payment date, the City shall so notify
AMBAC. Such notice shall specify the amount of the anticipated
deficiency, the Certificates to which such deficiency is applicable
and whether such Certificates will be deficient as to principal or
interest, or both.
(2) the City shall, after giving notice to AMBAC as provided
in (1) above, make available to AMBAC and the United States
Trust Company of New York, as insurance trustee for AMBAC, the
registration books of the City maintained by the Paying
Agent/Registrar, and all records relating to the funds and accounts
maintained under this Ordinance.
(3) the City shall cause the Paying Agent/Registrar to
provide AMBAC and the United States Trust Company of New
York with a list of registered owners of Certificates entitled to
receive principal or interest payments from AMBAC under the
terms of the Municipal Bond Insurance Policy, and shall cause the
Paying Agent/Registrar to make arrangements with United States
Trust Company of New York (I) to mail checks or drafts to the
registered owners of Certificates entitled to receive full or partial
interest payments from AMBAC, and (ii) to pay principal upon
Certificates surrendered to United States Trust Company of New
York by the registered owners of Certificates entitled to receive full
or partial principal payments from AMBAC.
761(;301
-31-
(4) the City shall cause the Paying Agent]Registrar to
notify, at the time it provides notice to AMBAC pursuant to (1)
above, the registered owners of Certificates entitled to receive the
payment of principal or interest thereon from AMBAC (I) as to the
fact of such entitlement, (ii) that AMBAC will remit to them all or a
part of the interest payments next coming due, (iii) that should
they be entitled to receive full payment of principal from AMBAC
they must tender their Certificates (along with a form of transfer of
title thereto) for payment to United States Trust Company of New
York, as insurance trustee for AMBAC, and not the Paying
Agent]Registrar, and (iv) that should they be entitled to receive
partial payment of pnncipal from AMBAC they must tender their
Certificates for payment thereon first to the Paying
Agent]Registrar, who shall note on such Certificates the portion of
the pnncipal paid by the Paying Agent/Registrar, and then, along
with a form of transfer of title thereto, to AMBAC, which will then
pay the unpaid portion of principal.
(5) AMBAC shall, to the extent it makes a payment of
principal of or interest on Certificates, become subrogated to the
nghts of the recipients of such payments in accordance with the
terms of the Municipal Bond Insurance Policy, and to evidence
such subrogation (I) in the case of subrogation as to claims for
past due interest, the City shall cause the Paying Agent/Registrar
to note AMBAC's dghts as subrogee on the registration books of
the City maintained by the Paying Agent]Registrar upon receipt
from AMBAC of proof of the payment of interest thereon to the
registered owners of the Certificates, and (ii) in the case of
subrogation as to claims for past due principal, the City shall
cause the Paying Agent]Registrar to note AMBAC's dghts as
subrogee on the registration books of the City maintained by the
Paying Agent] Registrar upon surrender of the Certificates by the,
registered owners thereof together with proof of the payment of
principal thereof.
SECTION 38: Public Meetinq. It is officially found, determined, and declared that the
meeting at which this Ordinance is adopted was open to the public and public notice of the time,
place, and subject matter of the public business to be considered at such meeting, including this
Ordinance, was given, all as required by V.T.C.A., Government Code, Chapter 551, as amended.
SECTION 39: Effective Date. This Ordinance shall take effect and be in full force
immediately from and after its date of adoption shown below.
PASSED ON FIRST READING, March 23, 1999.
PASSED ON SECOND READING AND ADOPTED, this Apdl 6, 1999.
CITY OF SOUTHLAKE, TEXAS
ATTEST:
City Secretary
(City Seal)
APPROVED AS TO LEGALITY:
City Attorney
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PAYING AGENT/REGISTRAR AGREEMENT
fllStT A
THIS AGREEMENT entered into as of Apnl 6, 1999 (this "Agreement"), by and between
the City of Southlake, Texas (the "Issuer"), and Chase Bank of Texas, National Association, a
banking association duly organized and existing under the laws of the United States of Amedca,
(the "Bank").
RECITALS
WHEREAS, the Issuer has duly authorized and provided for the execution and delivery
of its "City of Southlake, Texas, Tax and WaterWorks and Sewer System (Limited Pledge)
Revenue Certificates of Obligation, Sedes 1999" (the "Securities"), dated Apdl 1, 1999, such
Securities scheduled to be delivered to the initial purchasers thereof on or about May 4, 1999;
and
WHEREAS, the Issuer has selected the Bank to serve as Paying Agent/Regisb-ar in
connection with the payment of the principal of, premium, if any, and interest on said Securities
and with respect to the registration, transfer and exchange thereof by the registered owners
thereof: and
WHEREAS, the Bank has agreed to serve in such capacities for and on behalf of the
Issuer and has full power and authority to per[orm and serve as Paying Agent/Registrar for the
Securities;
NOW, THEREFORE, it is mutually agreed as follows:
ARTICLE ONE
APPOINTMENT OF BANK AS
PAYING AGENT AND REGISTRAR
Section 1.01. Appointment. The Issuer hereby appoints the Bank to serve as
Paying Agent with respect to the Securities, and, as Paying Agent for the Securities, the Bank
shall be responsible for paying on behalf of the Issuer the principal, premium (if any), and interest
on the Securities as the same become due and payable to the registered owners thereof; all in
accordance with this Agreement and the "Bond Resolution" (hereinafter defined). The Issuer
hereby appoints the Bank as Registrar with respect to the Securities and, as Registrar for the
Securities, the Bank shall keep and maintain for and on behalf of the Issuer books and records
as to the ownership of said Securities and with respect to the transfer and exchange thereof as
provided herein and in the "Bond Resolution".
The Bank hereby accepts its appointment, and agrees to serve as the Paying Agent and
Registrar for the Securities.
Section 1.02. Compensation. As compensation for the Bank's services as Paying
Agent/Registrar, the Issuer hereby agrees to pay the Bank the fees and amounts set forth in
Annex A attached hereto for the first year of this Agreement and thereafter the fees and amounts
set forth in the Bank's current fee schedule then in effect for services as Paying Agent/Registrar
for municipalities, which shall be supplied to the Issuer on or before 90 days pdor to the dose
of the Fiscal Year of the Issuer, and shall be effective upon the first day of the following Fiscal
Year.
In addition, the Issuer agrees to reimburse the Bank upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Bank in accordance with any
of the provisions hereof (including the reasonable compensation and the expenses and
disbursements of its agents and counsel).
ARTICLE TWO
DEFINITIONS
Section 2.01. Definitions. For all purposes of this Agreement, except as other~vise
expressly provided or unless the context otherwise-requires:
"Acceleration Date" on any Security means the date on and after which the
principal or any or all installments of interest, or both, are due and payable on any
Secudty which has become accelerated pursuant to the terms of the Security.
"Bank Office" means the principal office of the Bank as indicated on page
9 hereof. The Bank will notify the Issuer in wnfing of any change in location of the Bank
Office.
"Bond Resolution" means the resolution, order, or ordinance of the governing
body of the Issuer pursuant to which the Securities are issued, certified by the Secretary
or any other officer of the Issuer and delivered to the Bank.
"Fiscal Year" means the fiscal year of the Issuer, ending September 30th.
"Holder" and "Security Holder" each means the Person in whose name a Security
is registered in the Security Register.
"Issuer Request" and "Issuer Order" means a written request or order signed in
the name of the Issuer by the Mayor, City Secretary, City Manager, or Director of
Finance, any one or more of said officials, and delivered to the Bank.
"Legal Holiday" means a day on which the Bank is required or authorized to be
dosed.
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or government or any
agency or political subdivision of a government.
-2-
"Predecessor Securities" of any particular Secudty means every previous Secudty
evidencing all or a portion of the same obligation as that evidenced by such particular
Secunty (and, for the purposes of this definition, any mutilated, lost, destroyed, or stolen
Secudty for which a replacement Secunty has been registered and delivered in lieu
thereof pursuant to Section 4.06 hereof and the Resolution).
"Redemption Date" when used with respect to any Secudty to be redeemed
means the date fixed for such redemption pursuant to the terms of the Bond Resolution.
"Responsible Officer'' when used with respect to the Bank means the Chairman
or Vice-Chairman of the Board of Directors, the Chairman or Vice-Chairman of the
Executive Committee of the Board of Directors, the President, any Vice President, the
Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, the Cashier,
any Assistant Cashier, any Trust Officer or Assistant Trust Officer, or any other officer of
the Bank customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of and
familianty with the particular subject.
"Security Register'' means a register maintained by the Bank on behalf of the
Issuer providing for the registration and transfers of Securities.
"Stated Maturity" means the date specified in the Bond Resolution the principal
of a Secudty is scheduled to be due and payable.
Section 2.02. Other Definitions. The terms "Bank," "Issuer," and "Securities (Security)"
have the meanings assigned to them in the recital paragraphs of this Agreement.
The term "Paying Agent/Registrar'' refers to the Bank in the performance of the duties
and functions of this Agreement.
ARTICLE THREE
PAYING AGENT
Section 3.01. Duties of Payinq A,qent. As Paying Agent, the Bank shall, provided
adequate collected funds have been provided to it for such purpose by or on behalf of the Issuer,
pay on behalf of the Issuer the principal of each Secudty at its Stated Maturity, Redemption Date,
or Acceleration Date, to the Holder upon surrender of the Security to the Bank at the Bank
Office.
As Paying Agent, the Bank shall, provided adequate collected funds have been provided
to it for such purpose by or on behalf of the Issuer, pay on behalf of the Issuer the interest on
each Security when due, by computing the amount of interest to be paid each Holder and
making payment thereof to the Holders of the Securities (or their Predecessor Securities) on the
Record Date. All payments of principal and/or interest on the Securities to the registered owners
765175.1 -3-
shall be accomplished (1) by the issuance of checks, payable to the registered owners, drawn
on the fiduciary account provided in Section 5.05 hereof, sent by United States mail, first class,
postage prepaid, to the address appearing on the Secudty Register or (2) by such other method,
acceptable to the Bank, requested in wnting by the Holder at the Holder's dsk and expense.
Section 3.02. Payment Dates. The Issuer hereby instructs the Bank to pay the principal
of and interest on the Securities at the dates specified in the Bond Resolution.
ARTICLE FOUR
REGISTRAR
Section 4.01. Secudty Reqister- Transfers and Exchan,qc--. The Bank agrees to keep
and maintain for and on behalf of the Issuer at the Bank Offi'ce books and records (herein
sometimes referred to as the "Security Register") for recording the names and addresses of the
Holders of the Securities, the transfer, exchange and replacement of the Securities and the
payment of the principal of and interest on the Securities to the Holders and containing such
other information as may be reasonably required by the Issuer and subject to such reasonable
regulations as the Issuer and Bank may prescribe. All transfers, exchanges and replacement
of Securities shall be noted in the Secudty Register.
Every Security surrendered for transfer or exchange shall be duly endorsed or be
accompanied by a written instrument of transfer, the signature on which has been guaranteed
by an officer of a federal or state bank or a member of the National Association of Securities
Dealers, in form satisfactory to the Bank, duly executed by the Holder thereof or his agent duly
authorized in wnting.
The Bank may request any supporting documentation it feels necessary to effect a
re-registration, transfer or exchange of the Securities.
To the extent possible and under reasonable circumstances, the Bank agrees that, in
relation to an exchange or transfer of Securities, the exchange or transfer by the Holders thereof
will be completed and new Securities delivered to the Holder or the assignee of the Holder in not
more than three (3) business days after the receipt of the Securities to be cancelled in an
exchange or transfer and the wdtten instrument of transfer or request for exchange duly
executed by the Holder, or his duly authorized agent, in form and manner satisfactory to the
Paying Agent/Registrar.
Section 4.02. Certificates. The Issuer shall provide an adequate inventory of pdnted
Securities to facilitate transfers or exchanges thereof. The Bank covenants that the inventory
of pdnted Securities will be kept in safekeeping pending their use and reasonable care will be
exercised by the Bank in maintaining such Securities in safekeeping, which shall be not less than
the care maintained by the Bank for debt securities of other governments or corporations for
which it serves as registrar, or that is maintained for its own securities.
Section 4.03. Form of Secudty Re,qister The Bank, as Registrar, will maintain the
Secudty Register relating to the registration, payment, transfer and exchange of the Securities
765175.1 -4-
J HtBIT A
in accordance with the Bank's general practices and procedures in effect from time to time. The
Bank shall not be obligated to maintain such Secudty Register in any form other than those
which the Bank has currently available and currently utilizes at the time.
The Secudty Register may be maintained in written form or in any other form capable of
being converted into written form within a reasonable time.
Section 4.04. List of Secudty Holders. -he Bank will provide the Issuer at any time
requested by the Issuer, upon payment of the required fee, a copy of the information contained
in the Security Register. The issuer may also inspect the information contained in the Secudty
Register at any time the Bank is customarily open for business, provided that reasonable time
is allowed the Bank to provide an up-to-date listing or to convert the information into ~vfitten form.
The Bank will not release or disclose the contents of the Secudty Register to any person
other than to, o¢ at the wntten request of, an authorized officer or employee of the Issuer, except
upon receipt of a court order or as otherwise required by law. Upon receipt of a court order and
pdor to the release or disclosure of the contents of the Secudty Register, the Bank will nofif7 the
Issuer so that the Issuer may contest the court order or such release or disclosure of the
contents of the Secunty Register.
Section 4.05. Return of Cancelled Certificates. The Bank will, at such reasonable
intervals as it determines, surrender to the Issuer, Securities in lieu of which or in exchange for
which other Securities have been issued, or which have been paid.
Section 4.06. Mutilated, Destroyed, Lost or Stolen Securities. The Issuer hereby
instructs the Bank, subject to the provisions of Section 19 of the Bond Resolution, to deliver and
issue Securities in exchange for or in lieu of mutilated, destroyed, lost, or stolen Securities as
long as the same does not result in an ovedssuanca.
In case any Security shall be mutilated, or destroyed, lost or stolen, the Bank may
execute and deliver a replacement Security of like form and tenor, and in the same denomination
and beadng a number not contemporaneously outstanding, in exchange and substitution for
such mutilated Security, or in lieu of and in substitution for such destroyed lost or stolen Security,
only upon the approval of the Issuer and after (i) the filing by the Holder thereof with the Bank
of evidence satisfactory to the Bank of the destruction, loss or theft of such Security, and of the
authenticity of the ownership thereof and (ii) the furnishing to the Bank of indemnification in an
amount satisfactory to hold the Issuer and the Bank harmless. All expenses and charges
associated with such indemnity and with the preparation, execution and delivery of a
replacement Secudty shall be borne by the Holder of the Security mutilated, or destroyed, lost
or stolen.
Section 4.07. Transaction Information to Issuer. The Bankwill, within a reasonable time
after receipt of written request from the Issuer, furnish the Issuer information as to the Securities
it has paid pursuant to Section 3.01, Securities it has delivered upon the transfer or exchange
of any Securities pursuant to Section 4.01, and Securities it has delivered in exchange for or in
lieu of mutilated, destroyed, lost, or stolen Securities pursuant to Section 4.06.
765175.] -5-
ARTICLE FIVE
THE BANK
Section 5.01. Duties of Bank. The Bank undertakes to perform the duties set forth
herein and agrees to use reasonable care in the performance thereof.
Section 5.02. Reliance on Documents, Etc. (a) The Bank may conclusively
rely, as to the truth of the statements and correctness of the opinions expressed therein, on
certificates or opinions furnished to the Bank.
(b) The Bank shall not be liable for any error of judgment made in good faith by a
Responsible Officer, unless it shall be proved that the Bank was negligent in ascertaining the
pertinent facts.
(c) No provisions of this Agreement shaU require the Bank to expend or dsk its own
funds or otherwise incur any financial liability for performance of any of its duties hereunder, or
in the exercise of any of its dghts or powers, if it shaft have reasonable grounds for believing that
repayment of such funds or adequate indemnity satisfactory to it against such dsks or liability is
not assured to it.
(d) The Bank may rely and shall be protected in acting or refraining from acting upon
any resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, note, security, or other paper or document believed by it to be genuine and
to have been signed or presented by the proper party or parties. Without limiting the generality
of the foregoing statement, the Bank need not examine the ownership of any Securities, but is
protected in acting upon receipt of Securities containing an endorsement or instruction of transfer
or power of transfer which appears on its face to be signed by the Holder or an agent of the
Holder. The Bank shall not be bound to make any investigation into the facts or matters stated
in a resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, note, security, or other paper or document supplied by Issuer.
(e) The Bank may consult with counsel, and the written advice of such counsel or any
opinion of counsel shall be full and complete authorization and protection with respect to any
action taken, suffered, or omitted by it hereunder in good faith and in reliance thereon.
(f) The Bank may exercise any of the powers hereunder and perform any duties
hereunder either directly or by or through agents or attorneys of the Bank.
Section5.03. Recitals of lssuer. The recitals contained herein with respect to the Issuer
and in the Securities shall be taken as the statements of the Issuer, and the Bank assumes no
responsibility for their correctness.
The Bank shall in no event be liable to the Issuer, any Holder or Holders of any Security,
or any other Person for any amount due on any Secudty from its own funds.
-6-
Section 5.04. May Hold Securities. The Bank, in its individual orany othercapacity, may
become the owner or pledgee of Secunties and may otherwise deal with the Issuer with the
same dghts it would have if it were not the Paying Agent/Registrar, or any other agent.
Section 5.05. Moneys Held by Bank- Fiduciary AccountJCollateralization. A fiduciary
account shall at all times be kept and maintained by the Bank for the receipt, safekeeping and
disbursement of moneys received from the Issuer hereunder for the payment of the Securities,
and money deposited to the credit of such account until paid to the Holders of the Securities
shall be continuously collateralized by securities or obligations which qualify and are eligible
under both the laws of the State of Texas and the laws of the United States of America to secure
and be pledged as collateral for fiduciary accounts to the extent such money is not insured by
the Federal Deposit Insurance Corporation. Payments made from such fiduciary account shall
be made by check drawn on such fiduciary account unless the owner of such Securities shall,
at its own expense and dsk, request such other medium of payment.
The Bank shall be under no liability for inter~st on any money received by it hereunder.
Subject to the applicable unclaimed property laws of the State of Texas, any money
deposited with the Bank for the payment of the principal, premium (if any), or interest on any
Security and remaining unclaimed for four years after final matudty of the Security has become
due and payable will be paid by the Bank to the Issuer, and the Holder of such Security shall
thereafter look only to the Issuer for payment thereof, and all liability of the Bank with respect to
such moneys shall thereupon cease.
Section 5.06. Indemnification. To the extent permitted by law, the Issuer agrees to
indemnify the Bank for1 and hold it harmless against, any loss, liability, or expense incun'ed
without negligence or bad faith on its part, adsing out of or in connection with its acceptance or
administration of its duties hereunder, including the cost and expense against any claim or
liability in connection with the exercise or performance of any of its powers or duties under this
Agreement.
Section 5.07. Interpleader. The Issuer and the Bank agree that the Bank may seek
adjudication of any adverse claim, demand, or controversy over its person as well as funds on
deposit, in either a Federal or State District Court located in the State and County where either
the Bank Office or the administrative offices of the Issuer is located, and agree that service of
process by certified or registered mail, return receipt requested, to the address refeffed to in
Section 6.03 of this Agreement shall constitute adequate service. The Issuer and the Bank
further agree that the Bank has the dght to file a Bill of Interpleader in any court of competent
junsdiction to deterT~ine the dghts of any Person claiming any interest herein.
Section 5.08. DT Services. It is hereby represented and warranted that, in the event the
Securities are otherwise qualified and accepted for "Depository Trust Company" services or
equivalent depository trust services by other organizations, the Bank has the capability and, to
the extent within its control, will comply with the "Operational Arrangements", effective
December 12, 1994, which establishes requirements for securities to be eligible for such type
depository trust services, including, but not limited to, requirements for the timeliness of
765173.1
-7-
payments and funds availability, transfer turnaround time, and notification of redemptions and
calls.
ARTICLE SIX
MISCELLANEOUS PROVISIONS
Section 6.01. Amendment. This Agreement may be amended only by an agreement in
writing signed by both of the parties hereto.
Section 6.02. Assiqnment. This Agreement may not be assigned by either party without
the pdor written consent of the other.
Section 6.03. Notices. Any request, demand, authorization, direction, notice, consent,
waiver, or other document provided or permitted hereby to be given or furnished to the Issuer
or the Bank shall be mailed or delivered to the Issue' or the Bank, respectively, at the addresses
shown on page 9.
Section 6.04. Effect of Headings. The Article and Section headings herein are for
convenience only and shall not affect the construction hereof.
Section 6.05. Successors and Assiqns. All covenants and agreements herein by the
Issuer shall bind its successors and assigns, whether so expressed or not.
Section 606. Severability. In case any provision herein shall be invalid, illegal, or
unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any
way be affected or impaired thereby.
Section 6.07. Benefits of Aqreement. Nothing herein, express or implied, shall give to
any Person, other than the parties hereto and their successors hereunder, any benefit or any
legal or equitable dght, remedy, or claim hereunder.
Section 6.08. Entire Agreement. This Agreement and the Bond Resolution constitute
the entire agreement between the parties hereto relative to the Bank acting as Paying
Agent/Registrar and if any conflict exists between this Agreement and the Bond Resolution, the
Bond Resolution shall govern.
Section 6.09. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an odginal and all of which shall constitute one and
the same Agreement.
Section 6.10. Termination. This Agreement will terminate (i) on the date of final
payment of the principal of and interest on the Securities to the Holders thereof or (ii) may be
earlier terminated by either party upon sixty (60) days written notice; provided, however, an early
termination of this Agreement by either party shall not be effective until (a) a successor Paying
Agent/Registrar has been appointed by the Issuer and such appointment accepted and (b) notice
given to the Holders of the Secunties of the appointment of a successor Paying Agent/Registrar.
765t75.! -8-
Furthermore, the Bank and Issuer mutually agree that the effective date of an early termination
of this Agreement shall not occur at any time which would disrupt, delay or othe~vise adversely
affect the payment of the Securities.
Upon an eady termination of this Agreement, the Bank agrees to promptly transfer and
deliver the Security Register (or a copy thereof), together with other pertJnent books and recorcls
relating to the Securities, to the successor Paying Agent/Registrar designated and appointed by
the Issuer.
The provisions of Section 1.02 and of Article Five shall survive and remain in full force
and effect following the termination of this Agreement.
Section 6.11. Govt. This Agreement shall be construed in accordance with
and governed by the la-'~s of the State of Texas.
IN WITNESS WHEREOF, the parties heret~ have executed
this Agreement as of the day and year first above written.
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION
[SEAL]
Attest:
Title:
BY
Title:
Mailing Address:
Corporate Trust Department
P. O. Box 660197
Dallas, Texas 75266-0197
Delivery Address:
Corporate Trust Department
2200 Ross Avenue, 5th Floor
Dallas, Texas 75201
CITY OF SOUTHLAKE, TEXAS
(CITY SEAL)
Attest:
BY
Mayor
Address: 667 N. Can'o, Avenue
Southlake, Texas 76092
Cit7 Secretary
-9-
HII31T '"
EXHIBIT
CITY OF SOL'T-B~AK~, TEXAS
(Tarran£ and Denton Counties)
$17,030,000 TAX AND WATERWORKS
AND SEWER SYS'I'~M (LLMtl'E-O PLEDGE) REVENUE
CERTIFICATES OF OBLIGATION. SERIES 1999
BOND PURCHASE CONTRACT
Honorable Mayor and Members of the Cky Council
City of Southlake
667 N. Carroll Avenue
SoutMake, Texas 76092
Ladies and Gentlemen:
The tmdersigned (the "Representative"), acting on behalf of itself and on behalf of
the underwriters listed on attached Schedule 1 (the Representative and such other
u~derwriters being herein collectively referred to as the "Underwriters") offers to enter
into ti'tis Bond Puxch~e Contract (this "Purchase Contract") with r.~ City of $o~thlake,
Texas (the "Issuer") which, upon the Issuer's City Council's acceptance of this offer as
evidenced by its execution by the Mayor, shall be binding upon the Issuer ~ upon the
Underwriters. This offer is ma~e subject to t4 accep~tce by the execution of this
Purchase Contract on or before 10:00 p.m., Central Time, on the date set out above, and,
if not so accepted by the execution, will bc subject to withdrawal by the Undea'~riters
upon notice delivered to the Issuer at any time prior to its acceptance by the execution
hereof.
1. Purchase Pric~. Upotl the terms and conditions and upon the basis of the
reprelen~tions, warranties and covenants set forth herein, the Underwriters hereby agree
to purchase from the Issuer, and the Issuer hereby agrees to sell to the Underwriters, all
(bur not less than all) of the Issuer's $17,030,000 Tax And Waterworks And Sewer System
(Limited Pledge) Revenue Certificates of Obligation, Series 1999 (the 'Certificates'),
which Certificates have the terms and feature~ (including those with respect to redemption)
set for~ in the Official Statement (as hereinafter defined in Paragraph 4 hereo0. The
Certificates shall have the maturities, bear interest from the specified date at the rates, and
have the other characteristics and terms as set forth on Exhibit "A.' which is attached
hereto and incorporated herein by reference.
The purchase price for all of the Certificates will be (i) 16,948,853.$0 (which
represents the par amount of the Certificates. less an underwriting discount of $127.725,
plus a reoffermg premium of $46.578.50), plus (ii) accrued interest on the Certificates,
calculated on the basis of a 360-day year of twelve 30-day months, from April 15. 1999
to the date of Closing.
The Certificates shall be as described in, and shall be issued pursuant to an
ordinance adopted by the Issuer's City Council (the "Ordlnancc") authorizing the issuance
of the Certificates. The Certificates shall be issued in accordance with the provisions of
the Ordinance and secured as provided therein and-as described i~ the Official Statemem.
Capitalized terms used herein thai are not otherwise defined shall have the meanings
ascribed to them in the Ordimmce.
2. Security Deoosit. Delivered to thc Issuer herewith is the good-faith
corporate check of the l~*,presentative, payable to the order of the Issuer in an amount
equal to one percent (1%) of the aggregate par amount of the Certificates (the "Check').
In the event the Issuer does not accept r/ha offer, the Check shall be promptly returned to
the Representative. Upon thc Issuer's acceptance of this offer by thc execution hereof, the
Check (i) shall not be cashed or negotiated but shall be held and retained in safekeeping
by the Issuer as security for the performance by the Underwriters of their obligations,
subject to thc terms and conditions herein set forth, to purchase and accept delivery of the
Certificates at the Closing, and (ii) shall be applied and disposed of by the Issuer solely
as provided m this Purchase Contract. In the event of thc Underwriters' compliance with
such obligations to purchase and accept delivery of the Certificates at the Closing, the
Check shall be returned to the Representative at the Closing. In tlxe event of the failure
by the Issuer to deliver the Certificates at the Closing or if the Issuer ~ha!l be nnnble tO
satisfy the conditions to the obligations of the Underwriters contained in this Purchase
Contract, or if the obligations of the Underwriters shall be terminated for any reason
permitted by this Purchase Contract, thc Check shall be returned promptly to thc
Representative. In thc event that thc Underwriters fail (other than for a reason l~laltted
hereunder) to purchase and accept delivery of the Certificates at the Closing, then thc
Issuer shall become entitled to cash or to aegotiate the Check and thc proceeds thereof
shall be: retained by the Issuer as and for full liquidated damages for such failure and for
any and all defaults on the part of the Underwriters and such proceeds shall constitute a
full release and discharge of all claims and damages for such failure and for any and all
such defaults. The Representative agrees not to stop payment on thc Check unless thc
Issuer has breaehe~ the tenm of this Purchase Contract.
3. Public Offering. Thc Underwriters hereby agree to make an initial bona
fide public offering of all the Certificates at prices sot ia excess of the il:dtial offering
prices (or yields) set forth on the inside cover pages of the Official Statement, plus accrued
interest on the Certificates, reserving the right to change such prices or yields as the
Underwriters shall deem necessary in connection w/th the offering of the Certificates
without any requirement of prior notice. The Underwriters may offer and ~ell the
Certificates to certain dealers (includin8 dealers depositin8 Certificates into invesunent
trusts) and others at prices lower than the public offering prices (or yields higher than the
public offering yields) stated on the inside cover page of the Official Statement.
Ordinance: Offieial Statement. Simultaneously with the execution of this
Purchase Contract, the Issuer will deliver (or cause to be delivered) to the Underwrit~r~
one copy of the Ordmanc,~, duly execut~i, approved and adopted and in full force and
effect. The Issuer hereby authorizes the Underwriters to use thc Ordinance in connection
with the public offering and sale of the Certificates.
Thc Issuer has heretofore delivered, to the Underwriters copies of the Preliminary
Official Statement relatect to the Certfficates, dated March 30, 1999 (the "Preliminary
Official Statement"), for the Underwriters' use in dete~,,iniug interest in the Certificates.
The Issuer ratifies, confirms and approves the use by the Underwriters, prior to the
hereof, of the Preliminary Official Statement and the information contained therein in
connection with the public offering of thc Certificates under the circumstances and
comaitions contained therein and herein.
On a date no more than seven (7) business days following the date of the Issuer's
acceptance hereof, the Issuer shall deliver to the Underwrite'rs copies of the final Official
Statement rehted to the Certificaf~s approved by duly authorized officials of the Issuer in
sufficient numt:~' to permit the Underwriters to comply with the requirements of Rule
15c2-12 (the "Rule") of the Securities and Exchange Commission. Such final Official
Statement shall be dated the date hereof and shall be substantially in the form of the
PrelLminary 0 ~cial Statement (which Official Statement, including the cover page thereto,
all exhibits, appendices, maps, pictures, diagrams, reports and statements included or
incorporated therein or attached thereto, and all amendmentS and supplementS that may be
authorized for use with respect to the Certificates approved by duly authorized officials
of the Issuer, is herein called the "Official Statement") with such changes as are pernfitled
by the Rule to reflect the pricing of the Certifica;es.
The Issuer authorizes the preparation of the Official Statemem and the inforlllatio~
cot~ralned therein to be used in connection with the publM offering and sale of the
Certificates under the ciro~m~tnnces and conditions contained therein and herein.
5, Renresentations. Warranties and Covenant*. The l~uer represents and
warrants to the Underwriters (and it shaU be a condition of the obliga~on of the
U crwritcrs to purchase and accept deliver~j of the Certificates that the Issuer shall so
represent and waxrant as of thc date of thc Closing) that:
(a) l;.-,d~tence: Power: and Authori~. The I~uer is a home-rule city
operating az such under the Texas Constitution :.d laws of the State of Texas and
has full legal right, power and authority (i) to issue the Certificates, (ii) to
EXHIBIT
authorize the preparation of the Preliminary Official Statement and the Official
Statement and to authorize their usc and distribution by the Underwriters, (iii) to
enter into this Purchase Contract and to sell and deliver the Certificates to the
Uudc~xn'iters as provided herein, (iv) to adopt the O~dinauce sad to carry out and
coasum, mate the actions contemplated thereby, and (v) to carry out and
con~-mmat~ all other transactions contemplated by each of the aforesaid
documents:
(b) l)u Au~ori ' . The Issuer's City Cooncil has duly adopted the
Ordinance (which is in full force and effect at thc time of the execution hereof) and
has duly approved the execution and delivery of this Purchase Con,'act, the
Official Statement and the Certificates, and h~ duly authorized the taking of any
aha all such actions as may be required on the part of the ~ to carry out, give
effect to and consummate the transactions contemplated by this Purchase Contract,
the Official Statement :md the Certificates:
(c) ~. At the time of the Issuer's acceptance of this
offer by the execution hereof, there is, and at the dam of the Closing there will be.
no action, suit, proceeding, inquiry or investigation, at law or m equity, or before
or by any court, public board or body. pending or known to be threatened agalmt
or affecting the existence of the Issuer or the title of in officials to their rnspeetive
posmons, nor to the best of the knowledge of the Issuer is there any basis therefor,
wherein an unfavorable decision, ruling or taxiing would adversely affect the
validity or enforceability of the Ordinance, the Certificates, th.is Purchase Contract
or any agreement or instrument relating thereto, used or contemplated for use in
the cons-rnmation of the transactions contemplated by this Purchase Contract or
the Official Statement:
(d) No I}ef:lult~. The Issuer is not aware of, nor has it been notified
that it is, in any material respect which wouM adversely affect the validity of thc
Certificates, in breach of or default under any applicable law or administrative
regulation of the State of Texas or any department, division, agency or
instrumentality thereof, or of the United States or any agency or ~entality
thereof or any applicable judgment or decree or any loan a~eement, note,
resolution, certificate, agreement or other ins~'ument to which the Issuer is a party
or i~ otherwise subject; and to the lmowledge of the Issuer after due diligence the
execution and delivery of the Official Statement and the execution a~d delivery of
this Purchase Contract, the Certificates and the Ordinance, and compliance with
the provisions of e~"h thereof, will not conflict with or constitute a material breach
Of Or default ullder any applicable law or administrative regulation of the State of
Texas or any depax~ent, division, agency or instrumentality thereof, or of the
United States or any agency or inatru.mentality thereof or any applicable judgm~t
or decree or any loan agreement, note, re~olution, certificate, agreement or other
instrument tO which the Issuer is a party or is otherwise subject;
(¢) 3~1_~. As of the Closing, ~l approvals, consents ~
orders of any governmental authority, board, agency or commission ~vtng
jurisdiction which would constitute a condition prec~em to the pe~formaace by.ri~
Issuer of its obligations hereunder and under the Ordinance, the Certificates and
this Purchase Contract will have been obtained:
(f) Valtclttw of the Certificate. The Certificates, this Purchase
Contract and the Ordinance confom~ to t~e descriptions thereof contained in the
Official Statemeat; and the Certificates, when i~sued, authenticated and delivered
in accorctan~ with the Ordinance and sold m thc Underwriters, as provided in this
Purchase Contract, will be duly authorized, validly issued and oumanding
obligatiom of the Issuer secured in the wanner provided in the Ordinance and
described in the Official Statement and en~titled to the benefits of the Ordinance:
(g) ~lll$~ll.fillllll~l~. The excerpts from the financial statements
of ~he Issuer contained in the Official Statement present fafl'ly the financial position
of the Issuer az of September 30, 1998, and the result~ of its operations for its
fi~cal year then ended, in conformity with generally accepted accounting principles
applied on a basis con.si.stent with that of the prec~i-g year (except as noted
thereto);
(h) Accuracy of Information tn Qfficlal Statem~lt. At ~e time of the
Issuer's accepts.ce hereof and (unless dm Official Statem~ is amended or
supplemented p~suaat to subparagraph (j) of this Paragraph 5) at all tirn~
subsequent thereto up to and including the date of the Closing, the Official
Statemem (i~el, Mi.g the excerpt$ from the financial statements ami other
and statistical data included therein) docs not and will not contain any untrue
statement of a material faa or omit to stat.' any matehal fact required to be stated
therein or necessary to make the statements thereto, in the light of the
circumstances under which they we. re made, not misleading:
(i) Accuracy of Information in Ofllej~l Statement After Amt, ndw~m t
ilr_,$Ulllllilge~. If thc Official Statement is amended or supplemented pursuant
to subparagraph 0) of this Paragraph 5, at the time of each supplement or
amendment thereto and at all times subsequent thereto up to and including the date
of the Closing, the Official Statement, as so supplemented or amended (including
the financial Statements and other financial and statistical data included therein),
will not contain any untrue statement of a material fact or omit to s~te any
material fact required to be stated therein or nec~sary to mak~ the statements
therein, ill the ligllt 0f the circumstances under which they were made, not
misleading;
0) Amendin. or Suonlementin~, Official Statement. The Issuer shall
not revise, amend or supplement the Official Statement unless such revision.
amendment or supplement has been previously approved by the P.e!aresentativ¢.
If between the date of this Purchase Contract and the 91st day following the date
of the Closing an event occurs of which the Issuer has knowledge and which would
cause the Official Statement to contain any untrue statement of a material fact or
to omit to state any material fact required to be statezt therein or necessary to make
thc statements thereto, m the Light of thc cimu. m. stanc_.~ -rider which they were
made, not misleading, the Issuer shall notify thc Representative, and if. in the
opinion of thc Issuer or thc Representative, such event requires an amendment or
supplement to the Official Statement, the Issuer will, at its exp~nse, amend and
supplement the Official Statement in a form and in a manner jointly approved by
the Issuer and tile Representative;
(k) Prohibition Aauinnt Incurrimt Debt. Exert (i) as described in the
Official Statement and (ii) for approximnteiy $3.6 million of Combination Tax and
Tax Lncreme~t Reimbursement Zone Number One Rlilvenu~ Certifie. at~ of
Obligation, between the date of this Purchase Contract and ~e delivery of thc
Certi~icate~, the Issuer will not. without the prior writ'ten consent of the
Underwriters, issue bonds, certificates, notes or other obligations for borrowed
money which are or would be payable from or constitute a charge on the taxes or
revenues pledg~'xt to secure the payment cf the Certificates in ll~ Ordinance, and
between the respective dates as of which information is given in the Official
Statement and thc date of thc delivery of thc Certificates, thc Issuer has not
incurred and will not incur any material long-term liabilities (except that thc Issuer
may issue or incur, without the prior written consent of the Underwriters, any debt
described in the Official Statement);
(1) AD~l. ication of Proceeds. Thc Issuer will apply the proceeds of the
Certificates for the purposes, and in accordance with the description of the
application of such proco~s, set forth in thc Official Statmment;
(m) Maintainina Tax-Exemution of lnter~ on the Certifieat~ The
Issuer wiLl not take or omit to take any action which will adversely affect the
exclusion from income for federal income tax pm'po~ of the interest on the
Certificates; and the Issuer has not been notified of any listing or proposed listing
by the Internal Revenue Service to the effect that tim Issuer is a bond issuer whose
axbitrage certificates may not be relied upon; and
(n) Blue Sky. The Issuer will furnish such information, execute such
insmunents and take such action in cooperation with thc Represcnlative as the
Represemative may reasonably request (i) to q~mlifij the Certificates for offer and
sale under the Blue Sky or other ~ecuritie$ laws and regulations of such state and
other jurisdictions in the United States as the R~presmatative may designate, and
(ii) to continue such qualifications in effect so long as required for the distribution
of the Certificates; provide however, that the Issuer will not be required to qualify
as a foreign corporation or otherwise to do business or to file any general or
special consents to service of process under the laws of any state.
6
EXHIBIT B
6, Delivery of. and Payment for. the Ce, r~tficat~, At or before 10:00 a.m..
Central Time, on May 4, 1999, or on such other date as may be mutually agreed upon by
the Issuer and the Representative, the Issuer will deliver the Certificates to The Depository
Trust Company ('DTC") in New York, New York in such form as shall be acceptable to
DTC (which shall mctude primed or typewritten obligations if and to the extent required
by DTC), registered in the name of such nominee of DTC as it shall require, and deliver
to the Underwriters the other documents required by this-Agreemem. Subject to the terms
ancl coac~itior~ hereof, the Un,~erwriters will accept such delivery and pay the purchase
price of the Certificates as set forth in Paragraph ~ hereof ia ~nmediately available fundz.
Coacurrem with Such payment, the Issuer shall retttrn the Check to the Representative.
The actions relating to the payment for, and delivery of the Certffieate~, ia herein above
and hereafter call~ the 'Closing." The Repre~en~Uive shall furnish, and the Issuer shall
cause, CUSIP identification numbers to be inserted on the Certifica~s. but neither the
failure to insert such numbers on any Certificates nor any error with respect thereto shall
constitute cause for a failure or refusal by the Underwriters to accept anct pay for thc
Certificates in accordance with the terms of this Agreement.
Reoresentations and Warranties as of (~lonln? The r~presentations and
warrants contained in this Purchase Contract shal! remain operative ~ La full force and
effect on and as of the date of Closing, as it made on the date of CIo~ing.
8. Certain Conditions to Underwrite~' Ob~_~,~_-n.~. The Underwriters'
obliga~on hereunder to purcha,~ an~ pay for the Certificates shall be subject to the
performance by the Issuer of its obligations hereunder in all material respects at or prior
to the Closing and the accuracy in all material respects of the Issuer's representations and
warranties comamed harem and shall also be subject to the following conditions, any one
or more of which may be waived by the Underwriters:
(a) Continued l~ll Force and Effect of Doo~m,,nt,~ That at the time
of the Closing, the Ordinance, the Official Statement and all relY_-4_ actions of the
Issuer with respect to the issuance of the Certificates shall be in full force and
effect and shall not have been amended, modified or supplemented, except as may
have been agreed to by the Underwriters;
(b) No Default in Payment_of Debt Service. TI~ thc Issuer shall not
have failed to pay principal of or interest on, when due, any of its outstanding
obligatiom for borrowed money;
(~) Documents to be_Received by the Underwriters. That, at the
Closing, the Underwriters shall receive a copy of each of the followlng'do,-c~.~ts:'-
(1) Official Statma .e~,t. The Official S~aement of the
Issuer executed on behalf of the Issuer, with such amendments,
mo6ifications or supplements thereto as may have been previously
approved by the Underwri[er$;
(2) Ordinance. The OrdLr~nce cervical by the City
Secretary as having been duly adopted by the City Council of the
Issuer:
(3) I~u~7~lfl~l. A certificate of a duly
authorized official of the Issuer that the Ordinance has not been
amended, modified, supplemented or ret~aled, except as
contemplated hereby or as may ~ve been agreed to by the
Representative tn writing, and arc in full force amd effect;
(4) eunsel' . Opinion of bond counsel,
Fulbright & laworski L.L.P., Dallas, Texas ('Bond Counsel'),
dated as of the date of Closing, in form and substance of Appemiix
C ~o the Official State,neat:
(5) Bond Counsel's Suovlemental Oni.[nn, A
supplemental opinion of the Issuer's Bond Counsel, dated as oftl~
date of Closing, addressed to the Issuer and the UnderwriterS, to the
effect that (i) this Purci'~e Conlxact has been duly authorized,
executed and delivered by the Issuer and ks a legal, valid and
bmding agreement, exfforceable in accordax~ce with its terms
(provided that such opinion may contain the customary exceptions
regarding bankruptcy and equitable principles); (ii) the Certificates
and the Ordinance conform with the terms and provisions thereof
summarized in the Official Statement; (iii) the offering and sale of
the Certificates are not r~quired to be registered under the Securities
Act of 1933, as ameaded, (iv) the Ordinance is not required to b~
qualified ~mcler the Trust Indentzlre Act of 1.939, as amended, and
(v) the mformatinn relating to the Certificat~ and the Ordinnnt',e
appearing in the Official Statement under the captions "THti
CER'III~'iCATES" (except for the subcaptions "Book-Ent~-Oniy
System" and "Use of Certificates Proceeds,") "TAX MATTERS,"
and the subcaptions "Registration ands Q~mllficatioll of Cer',ificates
for Sale,~ "Legal Investments and Eligibility to Secure Public
Funds ia Texas." "Legal Matters,' and "Continuing Disclosure of
Laformafion" under the caption "OTHER INFORMATION" fairly
and accurately summarizes the provisions of the law, documents
and o~¢r ma~rs referred to therein; such opimon also shall comaia
a provision to the effect that the opimon referred to in subparagraph
(5) above may be relied upon by the Underwriters to the same
extent as if such opinion were addressed to them;
(6) Certificate as to Tax Exemmton. A certificate
8
signed by the Mayor or another authorized official of the Issuer
sening forth facts, estimates and circumstances in existence on the
date of the Closing, which facts, estimates and circnmstances shall
be sufficiently set forth therein to support the conclusion that it is
not expected that the proce~ls of the Certificatns will be used in a
manner or that the hsuer will take any action or omit to take any
action that would cause the Certificates to be 'arbitrage bonds,"
within the meaning of the Internal Revenue Code of 1986. az
amendocl (the 'Code"), ~ the regulations, temporary regulations
and proposed regulations promulgated u~der the Code, and stating
that to the best of the knowledge and belief of such official there are
no other fact$, estimates or circumstances that would materially
affect such expectations;
(7) Counsel to the Underwriters' Oninie, n An
opinion, daied as of the date of Closing and addressed to the
Underwriters, of Delgado. Acosta, Braden & .Tones, P.C., E1 Paso,
Texas ("Counsel to the Underwriters"), to the effect that (0 the
offer and sale of the Certificates are not required to be registered
under the Securities Act of 1933, as amended, and (ii) the
Ordinance is no~ requked to be qualified -.d_er the Trust Inden~re
Act of 1939, as amended. In addition, such firm shall s~t~ that
without having undertaken to dete(afne independently the accuracy
or completeness of the starew~t_s contained in the Official
Sta~ment, based upon such counsel's participation in the
preparation of the Official Statement. nothing has come to such
counsel's attention which gives such counsel reason to believe thai
the Official Star~ment as of the date of this Purchase Conwact and
as of the date of the Closing (except for financial statemems and
other financial and statistical dam as to which no view n,~d_~ be
expressed) contained or contains any .utrue statement of a material
fact or omitted or omits to state any material faa required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made. not
misleading;
(8) Issuer's Certificate. A certificate, dated as of the
date of the delivery of the Certificates and signed by the Mayor or
other duly anthori~x.d official of the Issuer to the effect that (i) the
represemations, warranties and covenants of the Issuer contained
herein are ~ and correct in all material respects on and as of the
date of the delivery of the Cerfifkales, with the sarae effect as if
made on the date of the delivery of the Certificates by the Issuer;
(ii) except as described in the Offmial Statement, no litigation is
pending or, to the best of such official's kuowledge and belief,
EXHIB!T B
threatened in any court in any wa}, affecting thc existence of the
Issuer or thc titles of its officials to their respective positions, or
seeking to restrain or to ~ajoia thc issuance, sale or delivery of thc
Cemficates, or lhe levy and collection of ad valorem taxes by the
Issuer (other rban apD~is of tax assessment~) or the application of
revenues and assets of the Issuer or in any way contesting or
affecting the validity or enforceability of the Certificates, the
Ordinance, or this Purchase Contract, or contesting m any way the
completeness or accuracy of the Preliminary Official Statement or
the Official Statement, or contesting the powen of the Issuer or its
authority with respo:t to the Certificates, the O~iaance or ml,
Purcha~ Contract; (iii) as of the date of the CIosing, the Official
Statement (including the appendices thereto) of the Issuer does not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necesaaz7 to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; and (iv) no event affectin~ the
Issuer ~ occurred since the date of the Official Statement to the
date of thc Closing which should be diaclosed ia thc Official
Statement for the purposes for which it is to be used or which it is
necessary, to disclose therein in order to mai, the statements and
information thereto not misleading in any respect;
(9) Attorney General's Ooiaion. The approving
opinion of the Attorney General of the S/ate of Texas in r~ of
the Certificates:
(10) Comotroller'2 Re~dstration Certificate. The
registratiou certificate of the Comptroller of Public Accounts of the
State of Texas in respect of the Certificates;
(11) Ratin~ L*tter~. Evidence of minimum ratings of
Moody's Investors Service, Inc. of "Aaa,' and Standard & Poor's
of "AAA," on the Certificates, in a form acceptable to the
Undervofiters:
(12) ~ Copy of the policy of municipal
bond guaranty insurance issued by AMBAC Assur~m'~ Corporation (or
such other municipal bond ir~urer which is acceptable to the
Representative) insuring payment of the principal of, ami interest on, the
Certificates, together with the customary opinions of its legal counsel in a
form satisfactory to Bond Counsel anti Counsel to the Underwriter;
(13) Additional Certificates. Instruments and Ooinlons.
Such additional certificates, instrument$ or opinions as Bond
10
Counsel or Counsel to the Underwriters may deem necessary or
desirable.
(d) Issuer's Performance of Ob[ieation~. That the Issuer ~hall
perform or have performed in all material respe~'_ s~ at or prior w ~he Closing all of
the Issuer's obLigatiom required under or specified in this P~cha~e Contract tn be
performed at or prior to the Closing.
All cerfit:icatcs, instruments, opinions and documenm referred to above ehal! 1~ in form
and substance satisfactory to Bond Counsel anct Cour~sel to the U~'4~rwriters. If the Issuer
should be unable to satisfy the conditions tn the obligations of the Underwriters to pay for
the Certificates contained in this Purclmse Contract or if the obligariom of the
Underwriters shall be termma~l for any reason pennitled hereby, this Purchase Conu'act
shall terminate, the Check shall be returned to the Representative and n~ither the
Underwriters nor the Issuer shall be trader fur~er obligation hereunder, except that the
respective obligations of the Issuer and tl~ Underwriters set forth in Paragraphs 7 and 12
hereof shall continue in full force and effect.
9. Termination of Purchase Contract bv the Underwriters. The
Underwriters may terminate this Purchase Contract by notification in writing or by
telegram to the Issuer if at any time subsequent to the date hereof and at or prior to the
Closing: (9 in the Congress of the United States, legislation shall be ellacted, a bill shall
be favorably reported out of committee to either house or a bill to amend the Internal
Revenue Code of 1986, as mended (which, if enaCted, would take effect ill whole or in
part as of a date prior to the Closing or be applied to the Certificates), shall be filed in
either house, or a decisio~l by a court of the United States shall be rendered, or a
regulatiou or ruling shall be issued or proposed by or on behalf of the Department of the
Treasury or thc Intemni Revenue Service of the United States, or any other agency of the
federal ~overnment, or a release or official statement shall be issued by the President, the
Dep~uLu~ent of the Treasury or the Internal Revenue Service of the United States, with
respect to federal taxation of interest received on obligations of the same character as the
Certificates, which, tn the reasonable opinion of the Underwriters, materially adversely
affects the market for the Certificates or the sale, at the contemplated offering pric,~, by
the Underwriters of the Certificates; or (ii) a stop order, ruling, regulation proposed
regulation or statement by or on behalf of the Securities and Exeh_ange CouhUission shall
be issued or made to the effect that the issuance, offering or sale of the Certificates without
registration thereof, or obligations of the general character of the Certificates without
registration thereof, is in violation of any provisions of the Securities Act of 1933, ~
amended; or (iii) in the Congress of the United States, legiSlatiOn shall be enacted or a bill
shall b~ fa¥0iably ieportcd out of committee of either house, or a decision by a court of
the United States shall bc rendered, or ruling, regulation, proposed regulation or statement
by or on behalf of the Securities and EXchange Cofl~miasion or other governmental agency
having jurisdiction of the subject matter shall be made, to the effect that securities of the
Issuer or of any sin~ilar pubiio body a~e not exempt from the registration, qualification or
other requirementS of the Securities Act of 1933, as amended, or that the Ordinance or
11
general character of the Certificates are required to be qualified under the Trot Indenture
Act of 1939, a.s amen~l~; or (iv) the United State. s shall have become engaged in hostilities
(includ. ing the escalalion of any hostility existing on the date hereof, whether or not
foreseeable), the effer~t of which, La the Underwriters' sole opinion, would malerially
adversely affect the market price of the Certificates; or {v) there shall have occurred a
general suspension of rradin$ on the New York Stsmr. k Excha.age, Inc. or there sb. all be
imposed upon trading in securities generally by any governmental authorit3' or by any
national securities exchange any material restrictions (other than a limitation on the hours
of uacting) not La force on the dam hereof; or (vi) a general banking moratorium shall have
been declared by the United States, State of Iexas or State of New York authorities; or
(vii) an event shall have occurred which, in the opinion of the Underwriters, requires an
amendment or supplement to ~e Officml Statement and whtch, tn the reasonable judgment
of the Underwriters, materially adversely affects the marketability of the Cextificates or
the market price thereof; or (viii) the ratings of the Certificates (or of the Issuer's other
OUl;si~nding debt obligations) are revised downward (or withdrawn completely) from those
established az of the date of this purchase Conlxact.
10. R~eioi for the Certificates. At the Closing, contemporaneously with the
receipt of the Certificates by the Underwriters. the Represemative will, if requesl~l,
deliver to the Issuer a receipt therefor, in form satisfactory to Bond Counsel, signed by
the Represe~tauve.
1 i. Reoroduction of Bond Counsel's Oninion on the Certificates. The
opinion of Bond Counsel as described in Paragraph 8(c)(4) may be reproduced on, or
attached to, the Certificates.
12. P~III~. The Issuer shall pay. from the proceeds of the sale
of the Certificates or other available funds, upon or promptly after the Closing: (a) the
cost of the preparation and printing of ~ Certificates, if any; Co) the costs of ob!~!ning
credit ratings and the cost of bond insurance premiums, if any; (c) the fees and
disbursemenm of Bond Counsel and of any other counsel or consultants re~_ i,,,xt by the
Issuer; (d) the costs of preparing, priming and mailing the Preliminary Official Statell~llt
and the Official Star,mere; (e) the fees and expenses of the Paying Agent/Registrar; (f) any
legally required publication expenses; (g) the out-of-pocket expenses, including the cog
of travel, of any officials of the Issuer; and (h) any other expemes agreed to by the Issuer
ro be reasonably considered expenses of the Issuer which are incident to the traxtsaclions
contemplated hereby.
TI~¢ Underwriters shall pay the fees and disbursements of CounSel to the
Underwritexs and the out-of-pocket ex'l~r~es incurred by the Underwriters. The Issuer
shall be under no obligation to pay any fees or expenses other than those SlYeC--it~ed in the
preceding paragraph.
13. ~[~,~.~. The Issuer shall provide certain periodic
12
EXHIBIT B _ ---
inforwafion and no,ices of material evcnr~ relatinl to ~e Ce~ at ~ ~ %~
· e ~.~ ~ ~ ~on 36 of ~e Ord~e reh~g w ~c Ce~ ~
~cora.~ wi~ ~e R~e.
14. ~. Any ~tice to ~ ~v~ ~ ~e I~u~ ~ ~ ~ Con~
~y ~ given by ~liv~ ~e s~e w ~e h~, at ~e add~s ~i~ a~ve,
A~ufion: Mayor (wi~ ~pies to ~e Ci~ Co~il), ~d ~y ~ uofice m ~ giv~
· e U~erw~s my ~ ~veu by ~livem8 su~ nofi~ to L P. Mor8~ ~ti~, Inc.,
300 Cres~nt Co~, S~ ~, D~, Texas 75201, A~ou: Ro~ G. Ru~.
15. ~t of Reur~eu*-flo~ ~d Wa~. ~e ~ ~d
represeumtiom ~d w~nti~ hereto ~ fo~ ~ve ~u ~ ~e ~e for ~e ~nefit of
~e Uude~fi~s a~ ~e ~su~; ~ ~ oth~ pe~ s~i ~e or ~ve ~y ri~t ~
or by v~e of ~s ~c~e Co~. Any ce~fiea~, d~m or ~et
sign~ by ~ au~or~ o~r or agem of the Is~er ~ ~Uv~ ~ ~e U~e~
pursuit ~ ~ te~ ~ provisiom h~f s~ll ~ d~ m ~ a r~um~n and
w~W ~e by ~e Issuer to ~e UMe~it~ ~ to ~e s~nu ~e ~e~.
16. ~. ~is P~c~e Comtact ~mfim~ ~e entre
agr~ent, ~s~diug, tepr~enmtiom, w~r~ties ~ obligafiom of~ p~ ~
wi~ resp~t to ~e u~ac~o~ contempiat~ hereby ~ s~ ~ome e~ve u~n ~e
acc~ce of ~h off, by ~e exertion ~d ~e co~t~ e~on her~f ~ p~ovi~,
s~l ~ v~id ~d ~orceable ~ of ~e t~e of su~
17. ~. This ~ ConU~ ~d ~y ~ her~ ~y
~ e~t~ in one or mo~ co~, each ofw~ s~l ~ d~ w ~ ~
by ~e pa~ exeeut~g su~ eo~te~, bm all of whi& s~l ~ ~nside~ o~ ~
s~e ~e~t.
18. ~. ~s ~c~e Con~ s~ ~ gov~ by
com~ m ac~r~ wi~ ~e la~ of ~e Sm~ of Te~ ~ ~e Ud~ S~em of
19. ~. ~ s~ou h~ of ~ ~rc~ Cou~ ~e for
convince of tefer~ce o~y ~ s~l not aff~ iu inte~remion.
20. ~. ~y au~ofi~, fi~t, d~on or o~
confe~ u~n ae U~s or ~e ~reseumfive ~d~ ~y p~ovBiou of
~c~e Con~t ~y ~ ex~cis~ by ~e R~esemafive, ~d ~e Issuer s~ ~
t0 rely UO0~ ~ ~eq~gt, u0~ce o~ s~em if ~e s~e s~ ~ve ~u given or
by ~e R~reseu~ve.
[F~ecuzion page follow~]
13
EXHIBilB
Very truly yours,
J.P. MORGAN SECURITIES 12N'C.,
~-~S REPP._ESENT~.T,J,VE OF THE
Roberto G. Ruiz, Vice Presiden~
APPROVED AND ACCEPTED AS
OF THE DATE FIRST ABOVE WRITTEN:
CITY OF SOUTHLAKE, TEXAS
By:
Rick Stacy
Mayor, City of Southlake, Texas
Schedule 1
to
Bond Purchase Contract
J.P. Morgan Securities Inc.
Morgan Keegan & Company, Inc.
Page 1 of Schedule 1
F-XHtI~IT /~
EXHIBIT "A"
City of Sou~-hl~ke, Texas
$~?,o~o,ooo T~,X AND WATERWORKS
AND sEWER SYSTEM (L~ll'rP-~ PL~0GE) ~
CER~CA~ OF OBLIGA~ON, ~ ~'
Thc Ce~ifi~s sh~l become due ~d ~y~le on ~e ~, ~ p~c~ ~oun~ ~
b~ int~ ~ ~e ranis) ~r ~nn~ ~ a~rd~-~ wi~ ~ follo~g ~ule:
February 15
An~otmt Maturity Rat~ (%) P~ic~ or Yiel~l (%)
320,000 20(30 5.00 3.20
620,000 2001 5.00 3.60
645,000 2002 5.00 3.75
680,000 2003 5.00 3.90 _
705,000 2004 4.875 4.00
7~0,000 2005 4.05 4.05
770,000 2006 4.15 4.15
815,000 2007 4.25 4.25
740,000 2008 4.35 4.35
780,000 2009 4.40 4.45
820,000 2010 4.50 4.57
535,000 2011 4.60 4.67
320,000 2011 4..70 4.67
335,000 2012 4.80 4.77
585,000 2012 4.875 4.77
940,000 2013 5.00 4..87
990,000 t 2014. 5.00 4.93
A-1
February 15
~mnnnt Ma~tsj Rate (%) Price or Yield
1,~,~ ~6 5.~ 5.05
1,1~,~ 2017 5.~ 5-10
1,195,~ 2018 5.~ 5.13
1,~0,~ 2019 5.~ 5.15
DATED DATE: April' 1, 1999
I~k'nEMPTION OPTION
The Issuer rescrvea the fight, at its option, to redeem Certificate~ having stated maturities
on and after February 15, 2009, in whole or ia part ia principal amounts of $5,000 or any
integral multiple thereof, on February 15, 2008, or any date thereafter, at the pax value
thereof plus accrued intereat to thc dare of redemption,
A-2
Exhibit C
to
Ordinance
DESCRIPTION OF ANNUAL FINANCIAL INFORMATION
The following information is referred to in Section 36 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 under the headings of the Official Statement referred to) below:
1. The financial statements of th~ City appended to the Official Statement
as Appendix B, but for the most recently concluded fiscal year.
2. The information contained in Tables I through 6 and 8 through 14 of the
Official Statement.
Accounting Principles
The accounting principles referred to in such Section are the generally accepted
accounting principles as applicable to governmental units as prescribed by The Government
Accounting Standards Board.
FED. I.D. NO. 22-3148254 148751.19
Star-Telegram AD ORDER NO.
400 W.SEVENTH STREET•FORT WORTH,TEXAS 76102 ACCOUNT NO. C IT 57
THE STATE OF TEXAS
)unty of Tarrant
Before me, a Notary Public in and for said County and State, this day
personally appeared TAMMIE BRYANT Billing Specialist for the
Star-Telegram, published by the Star-Telegram Inc. at Fort Worth, in Tarrant County, Texas; and
who, after being duly sworn, did depose and say that the following clipping of an advertisement was
published in the above named paper on the following dates:
DATE AD ORDER NO. DESCRIPTION AD SIZE TINCHTLINE RATE AMOUNT
4/09ME 14875619' CITY OF SOUTHLAK I358 1x 42L 42 QUOTE 34 . 02
CITYOTEXASHLAKE, 04/09-04/0.9._. __. _.
' ORDINANCE NO.739 -
•AN ORDINANCE authorizing
the issuance of "CITY OF
sOUTHLAKE TEXAS, TAX
AND WATEYtWORKS AND
SEWER (LIMITED PLEDGE)
REVENUE CERTIFICATES OF
OBLIGATION,SERIES 1999';
specifying the terms and fea-
tures of said Certificates• ..
providing for the payment of
said certificates of obliga-
tion by the levy of an ad valo-
rem tax upon all taxable
property within the City and
a remeeds pom eo fo ptehrea to t
of the City's Waterworks and
Sewer Sem;ng othersmattersdinc denreslt
and relating to the issuance
payment, security sale and
Idelivery of said Certificates.
including the approval and S
execution of a Paying Agent/
Registrar Agreement and a
Purchase Contract and the
St anpOffcgiialnStatenent e a 12th APRIL 1999
PASSEDnANDeAPPROVED BY SWORN TO BEFORE ME, THIS THE DAY OF ,
THE CITY COUNCIL OF THTEX 11/� k-Y� I C-.�1 J
CITY OF RIL 6,1999. _,a�Ay �e� W o` -
AS ONAPRIL6,1999. Notary Public
MA'/OR RICK STACY o1P `6.,y RHONDA R. GOKE
ATTEST:SANDRA L. �§ 40
LEGRAND CITY SECRETARY �'' COMMISSION EXPIRES 0
APPROVED AS TO FORM: E. ��;ty „s
ALLEN TAYLOR JR., V 4 .- ---'c� � TARRANT COUNTY,TEXAS
CITY ATTORNEY '�(e •-...•tEt- SEPTEMBER 8, 1999 +
P,.`�_
PLEASE PAY THIS ORIGINAL INVOICE AND RECONCILE WITH MONTHLY STATEMENT. THANK YOU!
.—TEAR ALONG THIS PERFORATION AND RETURN THE LOWER PORTION WITH YOUR PAYMENT-
Star-'Felegrain REMIT TO: PO. 400 W.SEVENTH ST. •FORT WORTH,TEXAS 76102
14875619 ACCOUNT CITS? AMOUNT 34 . 02
NUMBER , DUE
PAGE1 4 IF ANY QUESTIONS, PLEASE CALL(817)390-7885
CITY OF SOUTHLAKE
CTY SOUTHLAKE
667 N CARROLL AVE C
PLEASE PAY 34 . 02
SOUTHLAKE, TX 76092-6412 THIS AMOUNT
PLEASE WRITE IN AMOUNT ENCLOSED
Star-Telegram FED. I.D. NO. 22-3148254 14 7 8 9 8 6 5
AD ORDER NO.
400 W.SEVENTH STREET•FORT WORTH,TEXAS 76102 ACCOUNT NO. C I T 5 7
THE STATE OF TEXAS
>unty of Tarrant
Before me, a Notary Public in and for said County and State, this day
personally appeared TAMMIE BRYANT Billing Specialist for the
Star-Telegram, published by the Star-Telegram Inc. at Fort Worth, in Tarrant County, Texas; and
who, after being duly sworn, did depose and say that the following clipping of an advertisement was
published in the above named paper on the following dates:
I DATE AD ORDER NO. DESCRIPTION AD SIZE TOTAL RATE • AMOUNT
INCH/LINE
3/26ME 14789865 - CITY OF SOUTHLAK I358 lx 50L 50 QUOTE 40 . 50
CITY OF SOUTH LAKE. 03/26-03/26
TEXAS
NOTICE was hereby given to
all interested persons that
the City Council of the City of
Southlake, Texas, will be
-- - holding a public hearing dur-
ing the regular city council;
meeting_to be held on April
6, 1999, at 6:00 p.m. The
meeting will be held in the'.
City Council Chambers of — — —
City Hall, 667 North Carroll
Avenue, Southlake, Texas.
Pureheldposere ogardif the ng hea
the foring llowwill
b - _
nORDINANCE NO.739
AN ORDINANCE authorizing
the issuance of 'CITY OF
SOUTHLAKE TEXAS, TAX
AND WATERWORKS AND
SEWER SYSTEM (LIMITED
PLEDGE)REVENUE CERTIFI-
CATES OF OBLIGATION, SE-
RIES 1999 specifying the
terms and features of said S'
certificates; providing for
the payment of said certifi-
cates of obligation by the 29th MARCH 1999
Sl ona lift
axab fie
vpropertywithn WORN TO BEFORE ME, THIS THE DAY OF
the City and a limited pledge Q)'LLd-&
w rkth nan revenues from the `
operation of the City's water- ar v�.4
——Lie./P.---a
works and Sewer System; ?tiP .•..e`!t/ RHONDA R. GOKE Notary Public
and resolving other matters zy1
incident and relating to the is- 0��`•• - COMMISSION EXPIRES
suance, Da ment, security, y( •i
sale and deliverryy of said Cer- f,,p
tpirovae5and cexecugti the
of a 0 hr F•••••••• SEPTEMBER 8, 1999 TARRANT COUNTY,TEXAS
Paying Agent/Registrar ti %,�ov,.�r
Agreement and a Purchase �..,• "16.4,46•16.
Contract and the approval
and distribution of an Official
effectm Stateive datent;andprovidingan; ORIGINAL INVOICE AND RECONCILE WITH MONTHLY STATEMENT. THANK YOU!
Sandra L.LeGe.rand
City Secretary A—TEAR ALONG THIS PERFORATION AND RETURN THE LOWER PORTION WITH YOUR PAYMENT----j
Star-'I'elegraITl REMIT TO: , 400 W.SEVENTH ST. •FORT WORTH,TEXAS 76102
14789865 ACCOUNT CIT57 AMOUNT 40 . 50
NUMBER DUE
PAGE1 ( IF ANY QUESTIONS, PLEASE CALL(817)390-7885
CITY OF SOUTHLAKE
CTY SOUTHLAKE
667 N CARROLL AVE I--- --..,
PLEASE PAY 40 . 50
SOUTHLAKE, TX 76092-6412 THIS AMOUNT
PLEASE WRITE IN AMOUNT ENCLOSED