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• CERTIFICATE FOR
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF DENTON
t ELECTRIC SYSTEM REVENUE BONDS SERIES 1962
THE STATE OF T£:{AS
COUNTY OF DENTON
CITY OF DENTON
We, the undersiq,ed officers of said City, hereby certify
as follows:
1. .'he Cit•; Council of said City convened in
REGULAR 1:EETING ON THE 2ND DAY OF MARCH, 1962,
at cle Xunicipal Building (City Hall), and the roll was called
or the duly constituted officers and members of said City
Council, to-wit.:
Charlotte Allen, City Secretary Richard O. Stewart, Mayor
Mark Chew Pichard H. Talieferro
Dwight L. Gailey Dr. A. Ray Stephens
Jim Riddlesperger Joe Alford
and all of said persons were present, except the following
absentees: -/r ,"r ,
thus constituting a quorum. Whereupon, among other business,
the following was transacted at said Meeting: a written
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF DENTON
ELECTRIC SYSTEM REVENUE BONDS SERIES 1982
was duly introduced for the consideration of said City Council
and duly read.
It was then duly moved anti seconded that said ordinance be
passed; and, after due discussion, said motion, carrying with
it the passage of said ordinance, prevailed and carried by the
following vote:
AYES: All members of said City Council
sl:own present above voted "Aye".
NOES: None.
2. That a true, full, and correct copy of _he aforesaid
Ordinance passed at the Meeting described In the above and
foregoin- paragraph is attached to and follows this Certifi-
catel it said Ordinance has been duly recorded in said City
Councils minutes of said Meeting; that the above and foregoing
paragraph is a true, full, and correct excerpt from said City
Counc;il's minutes of said Meeting pertaining to the passarr of
said Ordinance; that the persons named in the above ai.d fore-
going paragraph are the duly chosen, qualified, and acting
officers and members of said City Council as indicated therein;
and that each of the officers and members of said City Council
was duly and s•sfficiently notified officially and personally,
in advance, of the time, place, and purpose of the aforesaid
Meeting, and that said Ordinance would be introduced and
considered for passage at said Meeting; and that said Meeting
was open to the public, and public notice of the time, place,
and purpose of said meeting was given, all as required by
Vernon's Ann. Tex. Civ. St. Article 6252-17.
3. That the Mayor of said Cii:y has approved, and hereby
approves, the aforesaid Ordinance; that the Mayor and the City
Secretary of said City have duly signed said ordinance; and
that the Mayor and the City Secretary of sai City hereby de-
clare that their signing of this Certificate shall constitute
the signing of the attached and fallowing copy of said Ordi-
nance for all purposes.
SIGNED AND SEALED the 2nd day of M ch 198 .
C1 secretary yor
(SEAL) .
We, the undersigned, being respectively the City Attorney
And the Pond Attorneys of the City of Denton, Texas, hereby
certify that we prepared and approved as to legality the at-
tA0hP.d ind fr,lluwina Orrlinanra orlnr f:o it5 nas.gAo as afore-
said. 0.(
j, C t torn /
.ee !Y~..<!f j ;r se kloe✓r
Bond Attorneys
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ORDINANCE NO. 92-
ORDINANCE AUTHORIZING THE ISSUANCE OF
CITY OF DENTON ELECTRIC SYSTEM P£VENUE BONDS
SERIES 1982
THE STAT1: OF TFXAS
(-'OUNTY OF DFPITON
C1'1'Y OF DENTON
WHEREAS, the City of Denton, Texas (the "City") has duly
issued, and there are now outstanding, pursuant to Vernon's
Ann. Tex. Civ. St. Article 1118n••12 and other applicable laws,
the following series or issue of Electric Revenue B.3nds which
are now secured by a first lien on and pledge of the Net
Revenues of the City's Electric Light and Power System (the
"System"):
City of Denton Electric System Revenue Refunding
Bonds, Series 1978, dated March 15, 1978, ori-
ginally issued in the principal amount of $19,255,000
(tha "Series 1978 Bonds"); and
WHEREAS, the Series 1970 Bonds are the only bonds or other
obligations secured by or payable from the Net Revenues of the
System; and
WHEREAS, th? City Co+inoi.l of the City is the governing
body of the Cityt and
WHEREAS, the bonds hereinafter authorized are "Additional
Bonds" as permitted by Ordinance No. 78-12 aurhorizing the
Series 1978 Bonds, and are to be issued and delivered pursuant
to Vernon's Ann. Tess. Civ. St. Articles 1111-1118, and other
applicable laws.
THEREFORE, THE COUNCIL. OF THE CITY OF DENTON HEPEB! ORDAINS:
Section 1. BONDS AUTHORIZED. That the City's bonds are
hereby authorized to be issued in the principal amount of
$3,000,0001 FOR THE PURPOSE OF PROVIDING MONEY FOR IMPROVEMENTS
AND EXTENSIONS OF THE ELECTRIC LIGHT ANL POWER SYSTEM OF THE
CITY.
Section 2. BONDS .,..IGNATED. That said bonds shall be
designated as then CITY OF DENTON ELECTRIC SYSTEM REVENUE
BONDS, SERIES 1982 (the "Series 1982 Ponds").
Section 3. DATE AND KU TURITIES. That the Series 1982
Bonds shall be dated APRIL 1, 1982, shall be in the denomina-
tion of $5,000 each, shall be numbered consecutively from one
upward, and Ehall mature serially on the maturity date, in each
of the years, and in the a:;ouats, respectively, unless redeemed
prior to maturity as required or permitted in the FORM OF BOND
set forth in Section 6 of this Ordinance, as set forth in the
following schedule:
MATURITY DATE: DECEMBER 1
YEARS AMOUNTS YEARS AMOUNTS
1983 $ 75,000 1992 $200,000
;934 75,000 1993 200,000
1985 75,000 1994 200,000
1986 75,000 1995 200,000
1987 ..00,000 ?996 200,000
19e8 200,000 1997 200,000
1989 200,000 1998 200,000
1990 200,000 1999 200,000
1991 200,000 2000 200,000
Section 4. INTEREST. Thnt the Series 1982 Bonds sched-
uled to mature during the years, respectively, set forth as
follows shall bear invorest from the date thereof to maturity
or redemption at the following rates per annum:
maturities 1983, Zz). inf% maturities 1992, o%
maturities 19n4, i3 go% maturities 1993, 7,r- 9
maturities 1985, 1.4.ov9 maturities 1994,
maturities 1986, i3•Qo$ maturities 1995,
maturities 1987, ,3 tv 8 maturities 1996,
maturities 1966, I_% maturities 1997, ia.As'e
maturities 1989, Aso 8 maturities 1998, ~V%
maturities 1990, Di maturities 1999, of v%
maturities 1991, ;,C8 rtttu.rities 2000, 1,' 8
Said interest slid!! be evidenced by interest coupon:3 which
shall appertain to the Series 1982 Bonds, and which shall be
V
payable in the man-Or provided on N `hIlti 1.^ dateG J.. `M} ..4aN in th
FORM OF UOND set forth in Section 6 of this Ordinance.
Secl:ion 5. GENERAL CHARACTERISTICS, That the Series 1982
Bonds and interest coupons shall be issued, shall be payable,
may be redeemed prior to their scheduled maturities, shall have
the characteristics, and shall be signed and executed {and the
Series 1982 Bonds shall be sealed), all as provided, and ir, the
2 l
1
manner indicated, in the FORM OF BOND set forth in Section 6 of
this ordinance.
Section 6. FORMS. That the form of the Series 1982
Fords, including the form of Rcgistration Certificate of the
Comptroller of Public Accounts of the State of Texas to be
printed and endorsed on each of the Series 1982 Bonds, and the
form of the aforesaid interest coupons which shall appertain
and be attached initially to each of the Series 1982 Fonds,
shall be, respectively, substantially as follows:
FORM OF BOND:
No. $5,000
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF DENTON
CITY OF DEN'TON
ELECTRIC SYSTEM REVENUE. BOND
SERIES 1982
ON DECEMBER 1, , THE CITY OF DENTON, IN DENTON COUNTY,
TEXAS, ;hereby promises to pay to bearer hereof the principal
amount of
FIVE '.HOUSAND DOLLARS
and to pay interest thereon at the rate of __.8 per, annum
from the date of this Bond, evidenced by interest coupons pay-
able DECEMBER It 1982, and semiannually on ear_h JUNE 1 and
DECEMBER 1 thereafter while this Bond is outstanding,
THE PRINCIPAL of this Bond and the interest coupons apper-
taining hereto shall be payable to bearer, in lawful mone,,, s.)f
the United States of America, without exchange or collectiin
chart}es to the bearer, upon presentation and surrender of this
Bond or proper interest coupon, at the fol'.owi.ng, which, co:.-
lectively, shall constitute and be defined as the "Paying
Agert" for this Series cf Fonds:
ThE FORT WORTH NATIONAL BANK, FOPT WORTH, TEXAS,
OR, 1T THE OPTION OF THE BEAREP,, AT
FIRST STATE BANK OP DENTON, DENTON, TEXAS.
THIS BOND is one of a Sei L-:e ciaaced as of APRIL i, 1982,
authorized and issued in the prima pal amount of $3,000,000,
r
FOR THE PUPPOSF. OF PROVIDING MONEY FOR IMPROVEMENTS AND
EXTENSIONS OF THE ELECTRIC LIGHT AND POWER SYSTEM OF THE CITY.
ON DECEMBER 1, 1991,
or on any interest payment date thereafter, the outstanding
Bonds of this Series may be redeemed prior to their scheduled
maturities, at the option of said City, in whole or in part,
with funds derived from any source, for the orinciPal amount
thereof and accrued interest thereon to the date fixed for
redemption, and without premium.
AT LEAST thirty days prior to the date fixed for any prior
redemption said City shall cause a written notice of such re-
demption to be published at least once in a financial publica-
tion published in The City of New York, New York. By the date
fired for any such redemption due provision shall be made for
the payment at the "Paying Agent" of the principal amount of
the Bonds which are to be so redeemed and accrued interest
thereon to the date fixed for redemption. If such written no-
tice of redemption is published and if due provision for such
payment is made, all as provided above, the Bonds which are to
be so redeemed thereby avLoroati.cally shall be redeemed prior to
their scheduled maturities, and they shall not bear interest
after the date fixed for redemption, and they shall not be re-
garded as being outstanding except for the right of the bearer
to receive the redemption price from the "Paying Agent" out of
the funds provided for such payment.
IT In nonEFv i+
~ u.,a Cert ..pCi, iCGLtrU, Qllll covenanted that tnls
llond has been duly and validly authorized, issued, and delty-
exed pursuant to the applicable laws of the State of Texas, in-
cluding particularly Vernon's Ann. Civ. St, of Texas, Articles
1111-1119; that all acts, ccnditionA, and things requiaed or
proper to be performed, exist, and ho done precedent to or in
the authorization, issuance, and delivery of this Bond and the
Series of which it is a girt hr-. hrnn norfnrmor9. oyf Mf-Arl: Ars1
been done in accordance with law; that this Bond and the Series
4
of which it is a part constitute sral,ial obliyatiunb ui said
City, secured by and pavable from an irrevocable first lien on
and pledge of the "Pledged Revenues", as defined in the
Ordinanc.~ authorizing this Series of Bonds (the "Ordinance"),
which include initially the "Net Revenues of the City's
Electric Light and Power System", as such term is defined in
the Ordinance, and which "Pledged Revenues" nay, in the future,
at the option of the Cily, include other resources.
THE CITY has reserved the right, subject to the restric-
tions stated in the ordinance, to issue additional parity
revenue bonds which also may be secured by and payable from an
irrevocable first lien on an~i pledge of the aforesaid Pledged
Revenues, in the sane manner and to the same extent as this
Fond rnd the Series of which it is a part.
THE HOLDER HEREOF shall never have the right to demand
payment of this cbligL%tion out of any funds raised or to be
raised by taxation, or from any source whatsoever other then
thr: Pledged Revenues and other sources described in the Or-
Oinance.
IN WITNESS WHEREOF, this Bond and the interest coupons
appertaining hereto have been signed with the facsimile signa-
ture of the Mayor of said City and countersigned dith the fac-
t;imile sigrature of the City Secretary of sjid City, and the
official seal of said City has been duly impressed, or placed
in facsimile, on this Bond.
xxxxxxxx _ XXXXXXXX
1-t Secretary, -city of Denton Mayor, CItyo Denton
FORM OF REGISTRATION CERTIVICATE:
COMPTROLLER'S REGISTFAT[ ON CEFTIFICATEt GEGIGTER t:0.
r i, ni.y rnrhi fry that n,,nd I- I-cen examined, cer-
tified as to validity, and approved by the Attorney General of
the State of l'exas, and that this bond has been registered by
the Comptroller of Public Accounts of the State of Texas.
1
5
1 1
WitneES my signature and seal this
Xxx:;Xxxx
Crmptrcller o Public Accounts
of the Statu of Texas
FORM OF INTEREST COUPON:
NO. $
ON It .
THE CITY OF DENTON, IN DENTON COUNTY, TEXAS, promises to pe.y to
bearer the amount shc.wn on this interest coupon, in lawful
raorley of the United Statas of America, without exchange or
collection charges to the bearer, unless due provision has been
made for the redemoticn prior to maturity of the Bond to which
this interest coupon appertains, upon prc!santation and surren-
der of, this interest coupon, at the
THE FORT WORTH NATIONAL BANK, FORT WORTH, TEXAS,
OR, AT THE OPTION OF THE BEARER, AT
FIRST STATE BANK OF DENT'ON, DENTON, TEXAS,
said amount being interest due that: day on the Bond, bearing
the number hereinLfter designated, of that issue of CITY OF
DENTON ELECTRIC SYSTEM PEVENUE BONDS, SERIES 1982, DATED APRIL
1, 1982. The holder hereof shall never have the right to de-
mand payment of this obligation out of any funds raised or to
be raised by taxation, or from any source whatsoever other than
the Pledged Revenues and other sources described in the Bond to
which this coupon. appertains. Bond No.
xxxxxxxx _ Xxxxxxxx
- qty SecreCary Mayor
Section 7. DEFINITIOKS. That as used in this Ordinance
the following terms shall have the meanings set forth below,
unless the text hereof specifically indicates otherwise:
(a) The term "City" shall mean the City of Derton, in
Denton County, Texas.
(b) The term "Outstanding Bonds" shall mean the presently
outstanding Electric Revenue 8ond3 of the City described in the
preamble to this Ordinance.
(c) The term "Bonds" shall mean collectively the
L Outstanding Bonds and the Series 1982 Bonds.
6
(d) Th~~ term "Additional Bonds" shall mean the addition-
al parity revenue bonds which the City reserves the right to
issue in the future, as provided in this Ordinance.
(e) The terms "Electric Light and Power System" and
"System" shall mean the City's existing electric light and
power system, together with all future extensions, improve-
ments, enlargements, and additions thereto, and all replace-
ments thereof; provided that, notwithstanding the foregoing,
and to ti.., extent now or hereafter authorized or permitted by
law, tho term System shall not mean any electric light and
power facilities of any kind (includ=.ng any electric power gen-
erating and transmission facilities; which are declared not to
be a part of the System and which are acquired or constructed
by the City with the proceeds from the issuanca of "Speci.al
Facilities Bonds", which are hereby d3fi.ned as being special
revenue obligations of the City which are not Bonds or Addition-
al Bonds secured by and payable from a first :ien on and Pledge
of the Pledged Revenues, as hereinafter defined, but which are
secured by and payable from any other liens, on and pledges of
any revenues, sources, or payments, including, but not limited
to, (i) special contra ct rpvanuec or payments received from any
other legal entity in connection with such facilities and/or (ii)
alien on and pledge of the Pledged Revenues junior and subor-
dinate in all respects to the lien and pledge ire favor of the
Bonds and Additional BondF; and such revenues, sources, or pay-
ments shall not be considered as or constitute Gross Revenues
of the System, un.leoG and to the extent otherwise provided in
the ordinance or ordinances authorizing the issuance of such
"Special Facilities Bonds".
(f) The terms "Gross Revenues of the City's Electric
Light and Power System' and "Gross Revenues" shall me n all
revenues, income, and receipts of ever; nature derived or re-
ceived by the City 1'~rn the operation and ownership of the
System, including interest income frcm the investment or
7
1
deposit of rnorf,y in any Fund created by this Ordinarce, et-
cepting only the Retirement Fund.
(g) The terms "net Revenues of the City's Electric Light
and Power System", and "Net Revenues" shall mean all Gross
Revenues after deducting and paying the current expenses of
operation and maintenance o` the System out, of the Revenue
Fund, hereinafter created, including all ealaries, labor,
materials, repairs, and extensions necessary to render efficient
service, provided, hvrever, that only such repairs and exten-
sions, as in the judgment of the City Council, reasonably and
fairly exercised by the adoption of appropriate resolutions,
are necessary to keep the System in operation and render ade-
quate service to said City and the inhabitants thereof, or such
as might be necessary to meet some physical accident or con-
dition which would otherwise impair the Bonds or Additional
Bonds, shall be deducted in determining "Net Revenues". De-
preciation shall never be considered as an expense of operation
and maintenance. Gross Revenues attributable to investment
interest income from the Reserve Fund and the Contingency Fund
shall be used only to pay current expenses of operation and
maintenance of the System anG shall never constitute any part
of Net Revenues.
(h) The term "Pledged Revenues" shall mean
(1) the Net Revenues, plus
(2) any additional revenues, income, re- +
ceipts, or other resources, including, without
limitation, any grants, donations, or income re-
ceived or to be received from the United States
Government, or any other public or private
source, whether pursuant to an agreement or
otherwise, which in the future may, at the
nrt.ion of the 0i1.y, be. pledged to the payment
of the Bonds or Additional Rnnrls.
8
W The term "year" shall mean the regular fiscal year
used by the City in connection with the operation of the
System, which may be any twelve consecutive months period
established by the City.
( j ) I'he term "Government Oblig riuns" shall mean direct
obligations of the United States of America, including obliga-
tions the principal of and interest on which are unconditonal-
ly guaranteed by the United States of America, which may be
United States Treasury obligations such as its State and Local
Government Series, which ray be in boor;-entry form.
Section 8. PLEDGE. (a) That the Series 1982 Bonds are
Additional Bonds issued pursuant to Sections 23 and 24 of
Ordinance No. 72-12 authorieinu the issuance of the Series 1978
Bond; and Sections 7 through 26 of this Ordinance substantial-
ly restate and are supplemental t~ and cumulative of Sections 7
through 26 of said Ordinance No. 78-12, so 'hat SACtions 7
through 26 will be applicable to all of the Bonds and future
Additional Bor.ds, except as otherwise specifically provided
herein, and state all of the requirements with respect to the
Bonds.
(b) That the Bonds and any Additional Bonds, and the
interest coupons appertaining thereto, are and shall be secured
by and payable from an irrevocable first lien on and pledge of
the Pledged Revr^ues) and the Pledged Revenues are further
pledged irrevocabl;' to the establishment and rnainteriance of the
Pledged Rc,.,cnucc Fund, the Retirement Fund, heretofore created
by Ordinance No. 78-12 for the sole benefit of the series 1978
Bonds, any other special invested retirement fund (similar to
the Retirement Fund heretofore established solely frr tha
be m it of the Series 1978 Bonds) hereafter created for the
payment of any future Additional Bonds, the Reserve Fund, the
Contingency Fund, and the Improvement Fund, all as hereinafter
dAfihPfj anfj f YnVj 9nA. Thn Rnnrlc gin) Win.. TAA4 tiyn~l n,,A, r~
f r
and will be secured by and payable from the Pledged P.evenues,
9
and are noc secured b; or payable frc:i a mortgage or deed of
crust or, any real, c rsonal, or mixed properties constitut-
ing the System.
Section 9. RLVENUF. FUND. That there is hereby created
ind there shall be established and maintained on the books of
the City, i:,d accounted for separate and apart from all other
funds of t'..e City, a special fund to be entitled the "City of
Denton El,,.tric System Revenue Bonds Revenue Fund" (the "Rev-
.,nae Funr'") A" CroGs ..evanaes wall La credited to the Rev-
cnu~
u.. +u ..ay u pen ii. ,Oipt, ui,ic o.i V1.110tW1.7C ~JL VVIUCU
in this Ordinance. All current expanses of operation and main-
tenance of the System shall be paid from such Gross Revenues
credited to the Revenue Funu, as z first charge against same.
All investment interest income credited to the Revenue Fund
shall be expended first for current operation and niintenance
expenses of the System, and in all events within five months
from the date of any such deposit.
Section 10. PLEDGED REVENUES FUND. That for the purpose
of paying the princijal of and interest on all Bonds and any
Additional Bonds, as the same mature and come due, and provid-
ing a source of payment for other deposits required by this
Ordinance, there is hereby created and there shall be establish-
ed and maintained on the books of the City, and accounted for
rom all other funds of the City, a separate
separate and apart from"
I
fund to be entitled the "City of Denton Electric System Rev-
enue Bonds Pledged Revenues Fund" (the "Pledged Revenues Fund").
Section 11. RESERVE FUND. That there is hereby created
and there shall be estahtichor and maintained initially at
The Fort Worth National Bank, Fort Worth, Texas, and there-
after, at the option of the City, established and maintained at
any time at any national bank having a capital and surplus in
excess of $25,000,000, a separate find to be entitled the "City
of Denton Electric System Revenue Bonds Reserve Fund" (the
"Reserve Fund"). The Reserve Fund shall be used solely for
10
the purpose of finally ratiring the last of any Bonds or Addi-
tional Fonds, or for ?ay'.ng principal of and interest on any
Bonds or Additional Bonds when and to the extent the amounts
in the Pledged Revenues Fund, the Retirement Fund, any other
special fund created for the payment of principal of and in-
terest on any Additional Bonds, the Improvement Fund, and the
Contingency Fund are insufficient for such purpose.
Section 12. CONTINGENCY FUND. That there is hereby
creates and there shall be established and maintained initiai-
ly at the Fort worth National Bank, Fort Worth, Texas, and
thereafter, at the option of the City, established and main-
tained e.t any time at any official depository bank of the City,
and acccunted for separate and apart from all other funds of
the City, a separate fund to be entitled the "City of Denton
Electric System Revenue Bonds Contingency Fund" (the Contin-
gency Frind"). The Contingency Fund shall be used eolely for the
purpose of paying the costs of unexpected or e:ttraoj:dinary re-
pairs or replacements of the System for Ahich System funds are
not otherwise available, or for paying principal of and inter-
est on any Bonds or Additional Fonds, when and, to the extent
the amount in the Pledged Revenues Fund, the Retirement Fund,
any other special fund created for the payment of principal of
and interest on any Additional Bonds, and the Improvenent Fund
are insufficient for such purpocc.
Section 13. IMPROVEMENT FUND. That there is hereby
created and there shall be established and maintAinari or. the
books of the City, and accounted for separate: and apart iron
all other funds of the City, a separate fund to be entitled
the "City of Denton Electric System Revenue 13onds Improvement,
Fund" (the "Improvement. Fund"). The Improvement Fund shall be
used solely for the purpose of paying the costs of improvements,
enlargements, extensions, additions, or other capital expendi-
tures related to the System, or for paying unexpected or ex-
traordinary c>:penscz of cpcration and maintenar.:c of the S ^^s
zl
for which Systen fund= are not otherwise available, or for pay-
ing principal of and interest on any Bonds or Additional 3onds,
when and to the extent the amount in tha Pledged Revenues Fund,
the- Retirement Fund, and anv other special fund created for the
payment or principal or and interest on any Additional Bonds,
are insufficient for such purpose.
Section 14. RETIREMENT FUND AND OTHER PAYMENTS. (a)
That there was created and established by Ordinance No. 78-12,
and there is hereby confirmed and ordered to be maintained at
The Fort Worth National Bank., Fort Worth, Texas, as trustee and
escrow agent, and &5 a paying agent for the. Bends, and ac-
counted for separate and apart from al'. other funds of the
Citj, a separate trust and escrow fund to be entitled the "City
of Denton Electric System Revenue Refunding Bonds Series 1978
Retirement Fund" (the "Retirement Fund"). The Retirement Fund
shall be used solely for the purpose of paying the principal of
and interest on the Series 1978 Bonds as the sane mature and
come due, or on redempt'on prior to maturity, and shall consti-
tute a special sinking fund for the Bonds. The City has en-
tered into a trust and escrow agreement with The Fort Worth
National Bank (hereinafter called the "Series 1978 Retirement
Tr•ist Agreement") which provides for the payment of the princi-
pal. of and interest on the Series 1978 Bonds as the same come
due, and the investment in Government V,ligations of money
deposited to the credit of the Retirement Fund by the City.
The City ehall make deposits to the credit of the Retirement
Fund as hereinafter provided in this Ordinance. if Additional
Bonds are hereafter issued, separate special invested retire-
ment funds (similar to the Retirement Fund) may or may not be
established, at the option of the City, for the special benefit
of such Additional Bonds at a paying agent therefor, but the
^.ctircT2nt Fund was created solely for the benefit and security
of the Series 1978 Bonds. It is provided, however, that all
Bonds and Additional Bonds shall be equally and ratably secured
i2
by and payable frori t_hs Pledged Revenues deposited to the
credit of the Pledged Revenues Fund, without preference or
priority, and the Series 1978 Bonds are entitled to an ex-
clusive claim on the Retirement Fund only after the deposits
have been made therein as prcvided in this Ordinance.
(b) That it is specifically provided that the Series 1962
Bonds are not payable from or secured by the Retirement Fund or
any other separate special invested retirement fund, but the
Series 1982 Bonds axe payable directly from Pledged Revenues in
the Pledged Revenues Fund, and Pledged Revenues sufficient to
pay the principal of and interest on the Series 1982 Bonds as
the same comp. due shall be deposited directly with the paying
agents for the Series 1982 Bonds, out of the Pledged Revenues
Fund, as required by Section 16(d) hereof.
(c) That all Bonds end Additional Bonds are on a parity
with respect to payment from Pledged Revenues in the Pledged
Revenues Fund and each Series or issue of Bonds and Additional
Bonds has an equal and ratable claim on said Pledged Revenues.
Section 15. DEPOSITS OF PLEDGED REVENUES; INVESTMENTS;
FU14DS SECURED. (a) That Piadged Revenues shall be credited to
or deposited in the Pledged Revenues Fund, the Retirement Fund,
the Reserve Fund, the Contingency Fund, tha Improvement Fund,
and other funds when and as required by this Ordinance and any
ordinance authorizing the issuan.cs of Additional Bonds.
(b) That money in any Fund established pursuant to this
Ordinance (excepting the Retirement Fund, which shall be in-
vested only in Government Obligations and as provided in 1.`Iie
Series 1978 Retirement Trust Agreement) may, at the option of
the City, be planed in time deposits or certificates of de-
posit secured by obligations of the type hereinafter described,
oz be invested in direct, obligations of the United States of
America, obligations guaranteed or inoured by the United States
of America, which, in the opinion of the Attorney General of
the United States, are backed by its full faith and credit or
13
represent its general obligations, or invested in indirect
obli-:~tions of the United States of 'merica, including, but
-Iet iimitei to, evidences of indebtedness issued, insured, or
;uarantee_" by such governmental agencies as the Federal Land
3anks, Federal Intermediate Credit Barks, Banks for Cooperatives,
Federal. Hone Loan Banks, Gcvernment National Mortgage Asso-
ciation, United States Postal Service, Farmers Home Admini.s-
tr,tiO.^., F]d,.. HOG, 1-n mortgage Association, Small
nes:i Administration, Federal iio'using Association, or Par-
ticipation Certificates in the Federal Assets Financing Trust;
provided that all such ceposits and investments shall be made
in such mar,n+:r that the money required to be expended from any
Fund will be available at the proper time or times. Such in-
vestments shall be valued in terms of current market va'.iv, as
of the 20t.h day of November of each year. All interest and
income derived from such deposits and investments immediately
shall bQ credited to, a,id any losses debited to, the Fund
from which the deposit or investment was made, and surpluses
in any Fond shall or may be disposed of as hereinafter provid-
ed. Such investme,,t.s shall be sold promptly when necessary
to prevent any default in C..,.r.eetion with the Bonds or Addi-
tional Bonds.
(c) That money in all Funds created by this Ordinance,
to the extent rot invested, shall be secured in the manner
prescribed by law for securing funds of the City.
Sectior, 16. DEBT SEP.VICE MQUIP.EMENTS. (a) That prompt-
ly after the delivery of the Derv's the city shall cause to be
credited to the Pledged Revenues Fund any accrued interest re-
cei.vel from the sale and delivery of t11F Rnnrls,
(b) That on or before May 25, 1978, and s:miaanually
on or before the 25th day of each November and of each May
t`iereafter, the City shall credit to the Pledged Rovenuas
l U4lU all ava.l y.},,yq tyGlAy cu LV YI"iu~~v.
l.4
ti
(c) On or before June 1, 1978, and semiannually on or
before the 1St (9iiy of fnpch f nY anG Cf c"-Ch June t"r,2
after, the City shall d=_pcsit to t-.e credit of the Retirement
Fund, from Pledged aevenues ~n the Pledged Revenues Fund, such
grunts as then will cause to be on deposit to the credit of
the Retirement Fund:
(i) money and/or
(ii) par or principal amount of Government Obli-
gations owned by the City,
aggregating the amour:t, re,5pectively, on each date, respect-
ively, shown on the following schedule:
F,ggregate Aggregate Aggregate
Amount Date Amount Date Amount Date
$ 443,000 6/1/78 $8,355,775 6/1/88 $8,166,475 6/1/98
1,877,814 12/1/78 9,555,775 12/1/88 9,466,475 12/l/98
1,705,072 6/1/79 8,326,375 6/1/89 8,157,700 6/1/99
2,617,072 12/1/79 9,526,375 12/1/89 8,407,700 12/1/99
2,701,072 6/1/80 8,296,375 6/1/90 8,150,387 6/1/00
3,618,072 12/1/80 91496,375 12/1/90 8,925,3°7 , 12;1/00
3,742,072 6/1/81 8,266,075 6/1/91 8,142,343 6/1/01
4,665,072 12/i/u1 6,666,075 12/1./91 8,41/,343 12/1/01
4,830,072 6/1,/82 8,250,775 6/1/92 8,134,300 6/1/02
5,761,072 12/1/62 8,850,775 12/1/92 8,434,300 12/1/02
5,970,072 6/1/83 8,2651325 6/1/93 8,125,525 6/1/03
6,911,072 12/1/83 8,835,325 12/1/93 8,425,525 12/1/03
7,1650072 6/1/84 81219,725 6/1/94 8,116,750 6/1/04
8,128,072 12/1/84 8,8190725 12/1/94 8,416,750 12/1/04
8,430,072 6/1/85 8,204,125 6/1/95 8,107,975 6/1/05
91285,072 12/1/85 8,804,125 12/1/95 8,457,975 12/1/05
8,4100407 f,/1/86 81188,375 6/1/96 8,097,737 6/1/06
9,545,407 12/1/86 8,68.3,375 12/1/96 80447,737 12/1/06
8,383,735 6/1/87 8,17-51250 6/1/97 8,087,500 6/1/07
9,548,735 12/1/87 8,475,250 12/1/97 6,175,500 12/1/07
Said schedule is intended to set fort `s the full aggregate
amounts which are required to pro ride fcr the payment and re-
demption of the principal of and interest on the Series 1976
Bonds an the sere mature and come due. However, it is antiri-
pated that the interest income from the investment of money in
the Retirement Fund in GovOrment Obligations will reduce the
amounts which otherwise :could be required to be deposited fr,>m
the Pledged Revenues Fund in order to cause the Retirement Fund
to contain the required aggregate amount on each required date
as shown in said schedule. The Series 1978 R-atirernent Trust
1.5
a~
Agreement provides for the investment of mcney deposited to the
credit of the Pet_irer,2nt Fund in Government Obligations and
other matters relating to the payment of the Series 1978 Bonds.
(d) Oct or before each June 1 and each Dece,r.!~er 1, the
City shall mjke such deposits from the Pledged Revenues Fund as
are required by this Ordinance, and by e<~ch ordinance authoriz-
ing the issuance of any AO..ditional Ponds for the payment of the
principal of, interest on, and redemption premiums, if any, on
such Additional Bonds, either to one or more special invested
retirement funds (similar to the Retirement Fund) for any Addi-
tional Bonds, or directly to any paying agent for any such Ad-
ditional Bonds for which no special retirement fund is estab-
lished.
(e' All investment interest income from the Pledged
Revenues Fund shall be retained in and Terrain a part of such
Fund.
l Section 17. RESERVE FUND REQUIREMENTS. That there is now
on hand in the Reserve Fund the required amount of $2,250,900.
It is found and determined, and has been officially estiranted
by the senior financial officer of the City, that $1,817,025 is
the max4.mum amount which will be required by this 4rdir:ance to
be deposited in the Retirement Fund with respect to the Series
1978 Bonds in any future year froi Fledged Revenues in the
Pledged Revenues Fund, taking into consideration the estimzted
amounts of Golrernment Obligations and interest income thereon
to be available in the Retirement Fund in the future. It is
further found and determined that no other special retirement
fund.n have been created, and that the average annual principal
ancl interest requir'ampnts of the Series 1962 Bonds are less
than $429,869. Therefore, the agyreyaLe amount required to be
accumulated and mainta:ne8 in the Reserve Fund by Section 23(b)
hereof after the delivery of the Series 1982 Bonds is
$2,2460894, being less than the presently required $2,250,000.
Therefore, when and so long as thu money and investments in the
16
Reserve Fund are not less in market value than $2,250,000 (the
"Reserve Required Amount") no deposits need be m-,de to the
credit of the Reserve Fund; but at any time the Reserve fund
contain. less than tine Reserve Regliir.ed Amount, then, subject
and subordinate to ,eking the required deposits to the credit
of tl:e Retirement Fund, and the deposits or payments required
by this Ordinance for the payment of the Series 1982 Bonds, and
by any ordinance autho-17ing the issL'9.^.ce of F:dditicnal p0.^.d5
for the retirement or payment t'sereof and the interest thereon,
the City shall transfer from Pledged Revenues in the Pledged
Revenues Fund, and deposit to thy: cre,:tit of the Reserve Fund,
€emi.annually on or before the 25th say of each May and of each
November, sum equal ca ii_utii of the Reserve Required Amount,
until th Peserve Find contains the Reserve Required Amount.
The City specifically co•,ienant.s that it will, between the 20th
and 25th days of each May and of each November of each year,
deposit to the credit of the Revenue Fund all surplus in the
Reserve Fund over the P.eses,;e Required Amount, to be used
within five months after each such deposit solely for the
payment of current operation and maintenance expenses of the
System.
Section 12. CONTINGENCY FUND REQUIREMENTS. That promptly
after tl,e delivery of the Series 1978 Bonds the City caused to
be deposited to the credit of the Contingency Fund, from pro-
ceeds from the sala and delis-ery of the Series 1978 Bonds, the
sun of $250,000. No deposits are required to Le made to the
credit of the Contingency Fund so long as the amount of money
and investments therein are at least equal in market value to
$250,000 (the "Contingency Required Amount"). If and when the
,amount in the Contingency Fund is reduced or depleted to less
than the Contingency Required Ariount, then, subject an,i
subordinate to making the required deposits to the credit of
the Retirement Fund, and the deposits or payments required by
this Ordinance for the payment of the Series 1982 Bonds, and by
17
any ordinance authorizing the issuance of Additional Bonds for
the retirement or payment thereof and the interest thereon, and
the Reserve Fund, such reduction or deplet~cn shall be restored
from Pledged Revenues in the Pledged Revenues Fund which shall
b,2 budgeted for such, purpose in the City's Annual Budget for
the System for the next ensuing fiscal year or years; provided
that the City is not required to budget more than an amount
equal to $50,000 for such purpose during any one fiscal year.
She City specifically covenants that it will, between the 20th
and 25th days of each May and of each November of each year,
deposit to the credit of the Revenue Fund all surplus in the
".:ontingency Fund over the Contingency Fund Required Amor.nt, to
he used within five months after each such deposit solely for
the pa,11ment of current operation and maintenance expenses of
the System.
Section 19. !Z,!Trv'v;rAiEN HkiD REQUIRE;i ENIS. That during
each year, subject and subordinate to making the required de-
posits to the credit of the Retirement Fund, the deposits or
payment's required by this Ordinance for the payment of the:
Series 1582 Bonds, and by any ordinance authorizing the fssu-
ance of Additional Bondr: for the retirement or payment thereof
and the interest thereon, the Reserve Fund, and the Contingency
Fund, the. City shall be required to deposit to the credit of
the Improvement Fund from Pledged Fevenues in the Pledged
Revenues Fund an amount equal to 88 of the "Adjusted Gross
Revenues of the System", which term is hereby defined to mean
the following:
the Grass Revenues of the System for such year after
deducting from such Gross Re.enuss an amount equal to
the current expenses of operation and maintenance of
the System for such year which are d~rectiy attribut-
able to M all fu,sl costs related to the production
of eiectric energy by the. City and/or (ii) the pur•-
chase of electric energy by the City.
18
Additional excess Pledged Revenues may, at the option of the
City Council, be deposited to the credit of the Improvement
Fund as permitted by Section 20 (b) hereof, but no such addi-
tional deposit is required. All investment interest income
from the Improvement Fund shall. be retained in and remain a
part of such Fund.
Section 20. DEFICIENCIES; EXCESS PLEDGED REVENUES.
(a) That: if on any occasion there shall not be sufficient
Pledged Revenues to make all deposits and payments when and as
required by this Ordinance and any ordinance authorizing the
issuance of any Additional Bonds, such deficiency shall be made
up as soon as possible from the next available Pledged Reve-
nues, or from any other sources available for such purpose.
(b) That, subject to making all deposits and payments
when and as required by this ordinance and any ordinance au-
thorizing the issuance of Additional Bonds, the excess Pledged
Revenues in the Pledged Revenues Fund may be used by the City
for any lawful purpose.
Section 21. PAYMENT OF BONDS AND ADDITIONAL BONDS. On or
before December 1, 1978, and semiannually on or before each
June 1 and December 1 thereafter while any of the Bonds or
Additional Bonds are outstanding and unpaid, the City shall
make available to the paying agents therefor, out of the Re-
tirement Fund, any other fund hereafter created for the retire-
ment and payment of principal of and interest on any Additional
Bonds, and directly out of the Pledged Revenues in the Pledged
Revenues Fund as required by this Ordinance, or out of the
Improvement Fund, the Contingency Fund, or the Reserve Fund, in
that order, if necessary, money sufficient to past, on each of
such dates, the principal of and interest on the Bonds and
Additional Bonds as the same matures and comes due, or to re-
deem the Bonds oz Additional Bonds prior to me rity, either
upon mandettory redemption or at the option of the City as set
forth herein. The paying agents shdii uestroy al.l paid Bonds
and Additional Bonds, and the coupons appertaining thereto, and
19
d
furnish the City with an appropriate certificate of cancella-
tion or destruction.
Section 2'. F.rNAL CEPCSITS. (a) That any Bond or Addi-
tional Bond s I1 be deemed to be paid, retired, and no longer
outstanding .hin the meaning of this ordinance when payment
of the principal of, redemption premium, if any, on such Bond
or Additional Bond, plus interest thereon to the due date
thereof (whether such due date be by reason of maturity, upon
redemption, or otherwise) either (i) shall have been made or
caused cc made in accordance with the terms thereof (including
the giving of any required notice of redemption), or (ii)
shall have teen provided by :_rrevocably depositing with or
making availaiule to a paying agent therefor, in trust and
irrevocably set aside exclusively for such payment, (1) money
sufficient to make such payment or (2) Government Obligations
w:,ich mature as to principal and interest in such amounts
and at such times as will insure the availability, without
reinvestment, of sufficient money to make such payment, and
all necessary and proper fees, compensation, and expenses
of such paying agent pertaining to the Bonds and Additional
Bonds with respect to which such deposit is made shall have
been paid or the payment thereof provided for to the satis-
faction of such paying agent. At such time as a Bond or Addi-
tional Bond shall be deemed to be paid hereunder, as aforesaid,
it shall no longer be secured by or entitled to the benefi`s
of this Ordinance or a lien on and pledge of the Pledged Rev-
enues, and shall be entitled to payment solely from such money
-)r Goverment Obligations.
(b) That any moneys so deposited with a paying agent may
at the direction of the City also be invested in Government
Obligations, maturing in the amounts and times as hereinbefore
set forth, and all income from all Government obligations in
the hands of the paying agent p•.irsuant to this Section which
is not required for the payment of the Bonds and Additional
20
Bonds, the redemption premium, if any, and interest thereon,
with respect to which such money has been so deposited, shall
k;a turned over to the City or deposited as directed by the
City.
Section 23. ADDITIONAL BONDS. (a) That the City shall
have the right and power at any time and from time to time,
and in one or more Series or issues, to authorize, issue, and
deliver additional parity revenue bcnds (herein called "Addi-
tional Bonds"), in accordance with law, in any amounts, for
any lawful purpose, including the refunding of any Bonds or
Additional Bonds. Such Additional Bonds, if and when author-
ized, issued, and delivered in accordance with this ordinance,
shall be secured by and made payable equally and ratably on
a parity with the Bonds, and all other -)utstandinc Additional
Bonds, from an irrevocable first lien on and pledge of the
Pledged Revenues.
(b) That the Pledged Revenues Fund, the Improvement
Fund, the Contingency Fund, and the Reserve Fund establish-
ed by this ordinance shall secure and be used to pay all Addi-
tional Bonds as well as the Bonds. Each ordinance under which
Additional Bonds are issued shall provide for the payment of
such Additional Bonds and the interest thereon. Each such or-
dinance may provide for the creation of a special invested re-
tirement fund (similar to the Retirement Fund) for such Addi-
tional Bonds or for payment:; directly to the paying agents
therefor, as provided in Section 16(d) of this Ordinance.
Each such ordinance also shall provide and require that the
aggregate amount to be accumulated and maintained in th-a Re-
serve Fund shall be increased (if and to the extent necessary)
to an amount not less than the aggregate of the following:
(i) the maximum amount, as then estimated by the
senior financial officer of the City, which
will be required by this Ordinance to be de-
posited to the credit of the Retirement Fund
I
in any future year from Pledged Revenues in
the Pledged Revenues Fund, ta,:ing into con-
sideration the then estimated amounts of Govern-
ment Obligations and interest income therefrom
to be available in the Retirement Fund in the
future, plus
(ii) the maximum am:,unt, if any, as then estimated
by the senior financial officer of the City,
which will be required by any ordinance or or-
dinances authorizing the issuance of any Addi-
tional Bonds to be deposited to the credit of
any special invested retirement fund or funds
(similar to the Retirement Fund) foi any out-
standing Additional Bonds in any future year
a from Pielged Revenues in the Pledged Revenues
Fund, taking into consideration the then esti-
mated amounts of G)vernment Obligations and
i
interest income therefrom to be available in
the future, plus
{iii) the average annual principal and interest re- j
quiraments of all Bonds and Additional Bonds
to be outstanding following the delivery of
the then proposed Additional Bonds, which are
payable directly from the Pledged Favenues
Fund and for which no special invested retire-
ment fund (similar to the Retirement Fund) has
been created and established by an ordinance
authorizing the issuance of Additional Bonds.
Such required additional amount shall be so accumulated by the
deposit in the Reserve Fund of all or any part of said requir-
ed additional amount in cash immediately after the delivery of
the then proposed Additional Bonds, or, at the option of the
{ City, by the deposit of said required additional amount (or
If any balance of said required additional amount not deposited
22
in cash as permitted above) from Pledged Revenues in the !'ledg-
ed Revenues Fund, in s=_miannual installments, made on or be-
fore the 23th day of each May and of each November following
the delivery of the then proposed Additional Bonds, of not
less than 1/10th of said required additional amount (or 1/10th
of the balance of said required additional amount not deposit-
ed in cash as permitted above).
(c) That all calculations of average annual principal
and interest r,:quirements made pursuant to this section shall
be made as of and from the date of the Additional Bonds then
proposed to be issued.
(d) That the principal of all Additional Bonds must be
scheduled to be paid or mature on December 1 of the years in
which such principal is scheduled to be paid or mature, a,id
all interest thereon must be payable on May 1 and December 1.
Section 24. FURTHER REQUIREMENTS FOR ADDITIONAL BONDS.
That Additional Bonds shall be issued only in accordance with
this Ordinance, but notwithstanding any provisions of this
Ordinance to the contrary, no installment, Series, or issue
of Additional Bonds shall be issued or delivered unless:
(a) The Mayor and the City Secretary of City sigh
a written certificate to the effect that the city is not in
default as to any covenant. condition, or obligation in con-
nection with all outstanding Bonds and Additional Bonds, and
the ordinances authorizing sarie, and that the Retirement Fund,
any other special invested retirement fund (similar to the
Retirement Fund) hereafter created for the retirement and
payment of the principal of and interest on any Additional
Bonds, and the Reserve Fund each contains the amount then re- I
quired to be therein.
,b~ A^ ird^ ^acnt :tif:cw ,-,:blic accountant, or in-
dependent firm of certified public accountants, signs a
written certificate to the effect that, during either the
,ibnt preceuliiiy real, 6t ai,y iwtllve vuiiaucutive calendar month
23
p3ried ending not more than ninety days prior to the passage
of the ordinance authorizing the issuance of the then propos-
ed Additional Bonds, the Pledged Revenues were, in his or its
opinion:
(1) at least $4,500,000, if the ordinance author-
izing the issuance of any Additional Bonds is
passed before September 30, 1979, which is the
end of the next complete fiscal year of the City,
or, if the ordinance authorizing the issuance of I
any Additio,ia;. Bundy is passed after September
30, 1979,
(2) at least equal to 1.4 times the aggregate of the
following amounts:
(i) the amount actually deposited, as re-
quired by this Ordinance, to the credit of
the Retirement Fund from Pledged Revenues in
the Pledged Revenues Fund during such year or
twelve month period, plus
(ii) the amount, if any, actually deposit-
ed, as required by any ordinance or ordinances
authorizing the issuance of Additional Bonds,
to the credit of any other special invested
retirement fend or funds (similar to the Re-
tirement Fund) for any outstanding Additional
Bonds from Pledged Revenues in the Pledged
Revenues Fund during such year or twelve
mouth period, plus
(iii) the average annual principal and in-
terest requirements of all Additional Bonds,
if any, to be outstanding after the delivery
of the then proposed Additional Bonds, which
are payable directly from the Pledged Revenues
Fund and for which no special invested retire-
ment fund (similar tro the Retirement Fund)
24
,r
has been created and established by an ordi-
nance authorizing the issuance of Additional
Bonds.
I
Section 25. GF.'.ERAL COVENANTS. The City further cove-
rants and agrees thae in accordance with and to Liiu exLLnt
required or permitted by law:
(a) PERP'M1ANCE. it will faithfully perform at all times
any and all covenants, undertakings, stipulations, and provi-
l sions contained in this ordinance, and each ordinance authoriz-
ing the issuance of Additional Bonds, and in each and every
Bond and Additional Eond; that it will promptly pay or cause to
be paid the principal of and interest on every Bond and Addi-
tional Bond, on the dates and in the places and manner pre-
scribed in such ordinances and Bonds or Additional Bends; and
that it will, at the times and in the manner pres.^ribed, de-
posit or cause to be deposited -:he amounts required to be de-
posited into the Pledged Revenues Fund, into the Retirement
Fun3, with thi paying agents for all Bonds payable directly
from the Pledc.d Revenues Fund, into any other fund or account
established for any Additional Bonds, and into the Reserve Fund
and the Contingency Fund; and any holder of the Bonds or Addi-
tional Bonds may require the City, its officials, and em-
ployees, to carry out, respect, ~ ; enforce the covenants and
obligations o this Ordinance, or any ordinance authorizing the
issuance of Additionai ssoncs, by all Legal and equitable means,
including specifically, but without limitation, the use and
filing of mandamus proceedings, in any uouLL of cuinpetent
jurisdiction, against the City, its officials, and employees.
(b) CITY'S LEGAL AUTHORITY. It is a duly created end
existing home rule city of the State of Texas, and is dull
authorized under the laws of the State of Texas to create and
issue the Bondsl that all ae^tion on its past for the creation
an-3 issuance of the Bonds has been duly and effectively taken,
2
1
and that the Bonds in the hands of the hollers and owners there-
of are and w'.11 b~ valid and enforceable sgeeial obligations of
the City ir, accordance with their terms.
(c) TITLE. It has or will obtain lawful title to the
lands, nuildings, structures, and facilities constituting the
System, that it warrants that it will defend, the title to all
the aforesaid lands, buildings, structures, and facilities, and
every part thereof, for the benefit of the holders and owners
of th? Rnnric 3nr9 addi tion.al °Cna.3, against the claims and de-
mands of all peraons whomsoever, that it is lawfully qualified
to pledge th,2 Pledged Revenues to the payment of the Bonds and
Additional'3onds in the mann,~r prescribed herein, and has law-
fully exercised such rights.
(d) LENS. It will from time to time and before the same
become delinquent. pay and discharge all taxes, assessments, and
governmental charges, if any, which shall be lawfully imposed
upon it, or the System, that it will pay all lawful claims ror
I
rents, royalties, labor, materials, and supplies which if un-
paid might by law beco.ne a lien or charge thereon, the lien of
which would be prior to or interfere with the liens hereof, so
that the priority of the liens granted hereunder shall be fully
preserved in the manner provided herein, and that it will not
create or suffer to be created any mechanic's, laborer's, ma-
terialman's, or other Lien or cha-ge which might or could he
prior to the liens hereof, or do or suffer any matter or thing
whereby the liens hereof might or could be impairc-3; provided,
however, that no such tax, assessment, or charge, and that no
such claims which might be used as the basis of a mechanic's,
laborer's, materialman's, or other lien or charge, shall be
required to be paid so long as the validity of the same shall
be ccnte"ted in good faith by the City.
(e) OPERATION OF SYSTEM; NO FREE SERVICE. While the
Bonds or any Additional Bonds are outstanding and unpaid the
City shall continuously and efficiently operate the System,
I in
and shall maintain the System in good condition, repair, and
w3rking order, all at reasonable cost. No free service of
the System shall be allowed, and should the City or any of
its agencies or ins:rum?ntal t ties make use of the snd facili.ties of the System, payment of the reasonable value
shall be made by the City out of funds from sources other than
the revenues of the System, unless made from surplus or excess
Pledged Revenues as permitted in Secticn 20(b) hereof.
(f) FURTHER ENCUMBRANCE. While the Bonds or any Addi-
tional Bonds are outstanding and unpaid, the City shall not
additionally encumber the Pledgrtd Revenues in any manner, ex-
cept as permitte-l in this Ordinance in connection with Addi-
tional Bonds, unless said encumbrance is made junior and sub-
ordinate in all respects to the liens, pledges, covenants, and
agreements of this Ordinance and any ordinanc,a a+ithorizing the
issuance of Additional Bonds; but the right of the City to
issue revenue bonds payable from a subordinate lien on the
Pledged Revenues is specifially recogniz,.d and retained.
(g) SALE OR DISPOSAL OF PROPERTY. V;hile the Ponds or
any Additioral Bonds are outstanflinn end unpaid, the r"+."
shall not sell, c,-)nvey, mortgage, encumber, lease, or in any
manner transfer title to, or otherwise dispose of the System,
or any significant or substantial part. thereof-, provided that
whenever the City deems it necessary to dispose of any property,
machinery, fixtures, or equipment, it may sell or otherwise
i dispose of such property, machinery, :fixtures, or equipment
when it has made arrangements to replace the same or provide
substitutes therefor, unless it. 13 determined by resolution of
I th; City CounCil that no such rey1aCi.uE3iii JiuublllUie i9
necessary.
(h) INSURANCE. (1) 4h^ City shall cause .a be insured such
harts of the System as would usually be insured by corjorations
operating like properties, with a responsible insurance Co.npar,y
27
cr cempani,as, aga: nst risks, accidents, or casualties against
which and to true extent insurance ip usually carried by corpora-
tions operating like properties, including, to the extent
reasonably obtainable, fire and extended coverage insurance,
insurance against damage by floods, and use and occupancy in-
surance. Public liability and property damage insurance --hall
also be carried unless the City Attorney of the City gives a
written opinion to the erect that the city is not liable for
claims which would be protested by such i:Lsurance. At any time
while any contractor engaged in construction work shall be fully
responsible therefor, the City shall not be required to carry
insurance on the work bein7 constructed if the contractor is
required to carry appropriate insurance. All such policies
shall be open to the inspection of the Bondholders an:` their
representatives at all reasonable times. Upon the happening
of any loss or damage covered by insurance from one or more
of said causes, the City shall make due proof of loss and shall
do all things necessary or desirable to cause the insuring
companies to make payment in full directly to the City. The
proceeds of insurance covering such property, together with
a-xy other fund!; necessary and available for such purpose, shall
b3 used forthwith by the City for repairing the property
damaged or replacing the property destroyed; provided, how-
ever, that if said insurance proceeds and other funds are in-
sufficient for such purpose, then said insurance proceeds
pertaining to the System shall be used promptly as fr.>llows:
M for the redemption prior to maturity of the Bonds
and Additional Bonds, ratably in the proportion that the
outstandin .~nln-c! 1 C L f
3 i._ -per. O.. =M' ud~.u5 or issue of Bonds
or Additional Bonds bears to the total outstanding prin-
cipal of all Bonds and Additional Bonds, provided that
if on any such occasion the principal of any such Series
or issue is noL buujnur to redemption, it sh,al.l not be
regarded as outstanding in malting --he foregoing compu•-
tationi or
28
(ii) if none of tha outstanding Bonds or Additional
Ocn(~s is subject to redemption, then for the purchase
on the open market and retirement of said Bor.ds and
1.01diti.onal Bonds in the same proportion as prescribed
in the foregoing clause (i.), to the extent practicable;
provided that the purchase price for any Bond or Addi-
ti.onai Bond shall not exceed the redemption price of
such Pond or Additional Bond on the first date upon
which it becomes subject to redemption; or
(iii.) to the extent that the foregoing clauses (i)
and (ii) cannot be complied with at the time, the in-
surance proceeds, or the remainder thereof, shall be de-
posited in a special and separate trust fund, at an
official depository of the City, to be designated the
Insurance Account. The Insurance Account shall be held
until such time as the foregoing clauses (i) and/or (ii)
can be complied with, or until other funds become avail-
able which, together with the insurance Account, will be
sufficient to make the rapairs or replacements originally
required, whichever of said events occurs first.
(2) The annual. audit hereinafter require3 shall contei.n
a section commenting on whether or not the City has complied
with the requirements of this Section with respect to the main-
tenance of insurance, which comments shall be based upon a certi-
ficate of the City Manager or other official designated by the
City council, and listing all policies carried, and whether or
not all insurance premiums upon the insurance policies to which
reference is hereinbefore made have been paid.
(i) RATE COVENANT. The City Council of the City will fix,
establish, maintain, and collect such rates, charges, and fees
for the use and availability of the system at all times as are
necessary to produce Grass Revenues Sufficient, together with
any other Pledged Revenues, (1) to pay all current operation
29
and maintenance expenses of the System, and (2) produce an
amount of Pledged Fevenues each year at least equal to (i) 1.4
times the aggrega`.e of the following amounts:
(1) the amount required to be deposited by this
Ordinance to the credit of the Retirement
Fund during such year after giving effect to
the anticipated interest income from the
investment of the moneys and investments
in the Retirement Fund), plus
(2) the amount, i£ any, required to ue dup;usited
by any ordinance or ordinances authorizing
the issuance of Additional Bonds to the credit
of any other special invested retirement fund
or funds (similar to the Retirement Fund) for
any outstanding additional Bonds from Pledged
Revenues in the Pledged Revenues Fund during
such year, plus
(3) the average annual principil and interest re-
quirements of all then outstanding Additional
Bonds, if any, which are payable directly from
the Pledged Revenues Fund and for which no
special invested retirement fund ;similar to
the Retirement Fund) ha-3 been created and es-
tablished by an ordinance authorizing the issu-
ance of Additional Bonds,
or (ii) amounts sufficient to provide for the deposits required
by Sections 18 and 13 hereof to be made to the credit of the
Contingency Fund and the Improvement Fund, whichever of (i)
or (ii) is the greater.
(j) RECORDS. It will keep proper books of record and
account in which full, true, and cos:ect entries will be made
of all dealings, ect.ivitf.ea, pnd tranarrt-Innv rpl,ting to the
System, the Pledged Revenues, and the Funds created pursuant
to this Ordinance, and all books, documents, and vouchers re-
lating thereto shall at all. reasonable times be mare avail-
able for inspection upon request of any Bondholder.
30
(k) AUDITS. After the close cf each year while any of
the Bonds or any Additional Bonds are outstanding, an audit
will be made of the books and accounts relating to the System
and the Pledged Revenues by an independent certified public
accountant or an independent firm of certified public account-
ants. As soon <<s practicable after the close of each such year,
and when said audit has been completed and made available to
the City, a ccpy of such audit for the preceding year shall be
mailed to the 14untcipal Advisory Council of Texas and to any
bondholders who shall so request in writing. Such annual audit
reports shall be open to the inspection of the bondholders and
their agents and representatives at all reasonable times.
(1) GOVERIIMENTAL AGENCIES. It will comply with all cf
the terms and conditions of any and all franchises, permits,
and authorizations applicable to or necessary with respect to
the System, and which have been obtained from any governmental
agency; and the City has or will obtain and keep in full force
and effect all franchises, permits, authorization, and other
requirements applicable to or necessary with respect to the
acquisition, construction, equipment, operation, and mainten-
ance of the System.
(m) NO COM-PETITION. It will not operate, or grant any
franchise or permit for the acquisition, construction, or
operation of, any local electric energy distribution facilJ.-
ties which would be in cc^ipetition with the System, and, t,)
the extent that it legally may, the City will prohibit any
such competing facilities.
(n) NO ARBITRAGE. That the City covenants to and with
the purchasers of the Bonds that it will make no use of the
proceeds of the Bonds at any time throughout the term of this
issue of Bonds which, if such use had been reasonably expect-
ed on the date of delivery of the Bonds to and payment for the
Bcnds by the purchasers, would have caused the Bonds to bo
arbitrage bonds within the meaning of Section 103(c) of the
Internal Revenue Code of 1954, as it;nentleu, Ur any zeyulations
;1
or rulings pertaining thereto; and by this covenant the City
is obligated to comply with the requirements of the aforesaid
Section 103(c) and all applicable and pert4.nent Department of
the Treasury regulations relating to arbitrage bonds. The
City further covenants that the proceeds of the Bonds will
not otherwise be used directly or indirectly so as to cal,se
all or any part of the Bends to be or beccme arbitrage bonds
within the meaning of the aforesaid Section 103(c), or any
regulations pertaining thereto.
Section 26. AMENDMENT OF ORDINANCE. (a) The holders of
Bonds and Additional Bonds aggregating in principal amount 51%
of the aggregate principal amount of then outstanding Bonds
and Additional Bonds shall have the right from time to time to
approve any amendment to this Ordinance w'ich may be deemed
necessary or desirable by the City, provided, however, that
i
nothing herein contained shall permit or be construed to per-
mit the amendment of the terms and conditions in this Ordinance
or in the Bonds or Additional Bonds so its to:
(1) Make any chance in the maturity of the outstand-
ing Bonds or Additional Ponds;
(2) Reduce the rate of interest toxne by any of t:ie
outstanding Bonds or Additional Bonds;
(3) Reduce the amount of the principal payable on
the outstanding Bonds or Additional Bonds;
(4) Modify the terms of payment of principal of or
interest on the outstanding Bonds or Additional
Bonds, or impose any conditions with respect to
:,uc . paymc^..t;
(5) r.++c.. t ♦uu rights of .uc 'holders Of less than
all of the Bonds and Additional Bonds then out-
standing;
(6) Change the minirwam percentage of the princi-
pal amount of Bonds and Additional Bcnds
I necessary for consent to such amendment.
32
(b) If it any time the City shall desire to amend the
Ordinance under this Section, the City shall cause notice of
the proposed amendment to be published in a financial news-
paper or journal published in the City of New York, New York,
once during each calendar week for at least two successive
calendar weeks. Such Notice shall briefly set forth the na-
ture of the proposed amendment and shall state that a copy
thereof is on file at the principal office of the Paying Agents
for inspection by all holders of bonds and Additional Bonds.
Such publication is not required, however, if notice in writ-
ing is given to each holder of Bonds and Additional Bonds.
(c) whenever at any time not less than thirty days, and
within one year, from the date of the first publication of said
notice or other service of written notice the City shall re-
ceive an instrument or instruments executed by the holders of
at least 518 in aggregate principal amount of all Bonds and
Additional Bonds then outstanding, which instrument or instru-
ments shall refer to the proposed amendment described in said
notice and which specifically consent to and approve such
amendment in substantially the form of the copy thereof on
file with the Paying Agents, the City Council may pass the
amendatory ordinance in substantially the same form.
(d) Upon the passage of any amendatory ordinance pur-
suant to the provisions of this Section, this Ordinance shall
be deemed to be amended in accordance with such amendatory
ordinance, and the respective rights, duties, and obligations
under this Ordinance of the City and all the holders of then
outstanding Ponds and Additional Bonds and all future Aonds
and Additional Bonds shall thereafter be determined, exercised,
and enforced heiiundez, subject in all respects to such amend-
ments.
(e) Any consent given by the holder of a Bond or Addi-
tional Bond pursuant to the provisions of this Section shall
33
be irrevocable for a period of six months from the date of
the first publication of the notice provided for in this
Section, and shall be conclusive and binding upon all future
holders or the same Bond or Additional Bond during such period.
Such consent may be revoked at any time after six months from
the date of the first publication of such notice by the holder
who gave such consent, or by a succe;,~or in title, by filing
notice thereof with the paying agents and the City, but such
revocation shall not be effective if the holders of 518 in
aggregate principal amount of the then outstanding Bonds and
Additional Bonds as in this Section defined have, prior to the
attempted revocation, consented to and approved the amendment.
(f} For the purpose of this Section, the fact of the
holding of Bonds or Additional Bonds by any bondholder and
the amount and numbers of such Bonds or Additional Bonds and
the date of their holding same, may be proved by the affidavit
of the person claiming to be such holder, or by a certificate
executed by any trust company, bank, banker, or any other de-
pository wherever, situated showing that at the date therein
mentioned such person had on deposit with such trust company,
bank, banker, or other depository, the Bonds and Additional
Bonds described in such certificate. The City may conclusively
assume that such ownership continues until written notice to
the contrary is served upon the City.
Section 27. APPROVAL AND REGISTRATION OF SERIFS 1982
BONDS. That the Mayor of the City is hereby authorized to have
control of the Ser!.es 1982 Bonds and all necessary records and
procec,,dings pertaining to the Series 1982 Bonds pending their
delivery and their investigation, examination, and approval by
• the Attorney General of the State of Texas, and their registra-
tion by the Comptroller of Public Accounts of the State of Texas.
Upon registration of the series 1982 Bonds, said Comptroller of
Public Accounts (or a deputy designated in writing to act for
34
said Comptroller) s':all ;ranualiy sion the Comptroller's Fegis-
tration Certificate printed anc endorsed on the Series 10,82
Bonds, and the seal of said Ce:nctroller shall be impressed, or
placa>ri in facsimile, on each of the Series 1982 Bonds.
Section 28. That it is hereby officially found and de-
termined: that a case of emergency or urgent public necessity
exists which re,uires the holding of the meeting at which this
Ordinance is passed, such emergency or urgent public necessity
being that the proceeds from the sale of said bonds are re-
gnired as soon as possible and without delay for necessary and
urgently needed public improvements; and that said meeting was
open to the public, and public notice of the time, place, and
purpose of said meeting was given, all as required by Vernon's
Ann. Civ. St. Article 6252-17.
Section 29. That the City Council officially finds, de-
termines, and declares that said bonds have been duly adver-
tised for sale as required by the Home R+lle Charter of said
City; that sealed bids have been received at a public sale of
said bonds held on March 2, 1982; that all of said bonds are
hereby sold and shall be delivered to a syndicate managed or
headed by rlc~e[.ee-~e~~_~'^'~r~ ^~<scd aAP~sA•_ •+~+~~'6rs_61ayo,
being the best bidder at said public sale, for the principal
amount: of said bonds, and accrued interest thereon to the date
of delivery, plus a premium of $3qro .
Section 30. It is further found and determined that the
official Notice of Sale for said bonds was duly published on
January 29, 1982, in The Bond Buyer, New York, New York, which
is a national publication regularly and primarily carry-
ing financial news and municipal bond notices, and on
January 29, 1982, in the Denton Record-Chronicle, which has
b?en designated as the official newspaper of the City of
Centon. The form and substance of said Official Notice of
:iale, and the aforesaid publications thereof, are hereby ap-
proved and ratified in all respects by the City Council.
35
I
Section 31. That it is hereby officially found, deter-
mined, and declared that said bonds have been sold at public
sale to the bidder offering the lo,,est interest cost, after
receiving scaled bids pursuant to arc ')fficial Notice of Sale
and Official Statement dated February 15, 1982, prepared and
distributed in connection with the sale of said bonds. Said
Official Notice of Sale and Official Statement have been and
are hereby approved by the City Council. It is further offi-
cially found, determined, and declared that the statements and
representations contained in said Official Notice of Sale and
Official Statement are true and correct in all material re-
spects, to the best knowledge and belief of the City Council.
I
I
I
36
LA.y OFFICES
MCCALL, PARKHURST & HORTON
r [e• r - 14-0 Mr G'=AyTIIE E!P'PK UJI'C,1v.5
9[r[M M - r CALLAS. TEiAS 75,
roa[.' n . . oeae vc+l
PV PjC 9r_9'CV ~ I.PST 0:1 'Of )
.LLO P r 9[w I9u CcG[ 2 s 'wy y}:. n?R [[•[•[PJwf ~i'J 'ilel
.C`I `Lrn [ lrl
eV r
March 2, 1982
Honorable Mayor and Council of
the City of Denton
Denton, Texas
Gentlemen:
City of Denton Electric System Revenue Bonds,
Series 1982, $3,000,000
In compliance with Section 9.02 and Section 9.04 of the
City Charter of the City of Denton, you are advised that the
bids for the captioned issue of bonds have been tabulated and
that we find that the bid of a syndicate managed or headed by
the following:
He.tl/LL L c.✓ G/+Vi~c" v✓6L0 Gfy.rta erJ G8u1..~_
with the bonds to bear interest at the rates i_herei- n specified,
with such bidder to pay par and accrued interest to date of
delivery for said bonds, plus a premium of $ 3✓•.r0 , i the
lowest and best bid received, and we recommend that it Ile
accepted.
We further certify that we have examiners the ordinan^e
presently placed before the Mayor and Council for the puq ose
of authorizing the issuance of said bonds, and, in our cpinion,
the said proposed bond ordinance is legal, and the bonds to be
issued thereunder will be special obligations of the City,
secured by and payable from an irrevocable first lien on an19
pledge of the "Pledged Revenues", as defined in the Ordinance
authorizing their issuance.
Respectfully,
I
OFFICIAL E3ID FORM
tionnrable >'3jcr an' City ronr`il 113toh 2, 1961
City of Demon
Denton, Ter;:;
G^_nt le`rn:
PafL arc" , .O yn r rffiCill Gtate•= :nt ant Y)tiCa Of Sale 3rd 3 dJ1n ! srructr•.qs, dated
Fc ',r y Of t1 r~r nn7 C iY Ur DE Tii'r, TE rr [LEC 7R1+ SSfEG1 AE 'tc ➢UhCS SERIES
ln» L, Ti f 1,,h rg•r t b' a f rt fi re.t
1.5t n. _tis n°1
.ali,r, to + 1 t'°in e.f s ~i_,~ fcr , rrraatj ring and rir} int.. rest
as frllces:
]nt; rest jnterest Interest
"itirity ate Matirity R..te Matarity Pate
12-Y-1933 / 12-}-19 3 X 12-1-Y995 % '
12-1-19drt ~oX
% 12-1-1917
% 12-1.19955 / ^ X
12-1-1935 X 12-Y•1991 =S % 12-I-1997 /.l %
12-1-1936 12-'-1992 X 12-1-1993
12-1-1357 % 12.1-1993 12-1-1999
12-1-1982 % 12-1-1994 12-1-2000 %
Our calculation (whTch is not a part of this bid) of U.C interest Best from the above is:
Total Interest Cost S
Less Prbmi uni 0
I.ET INTEREST COST 5
EFFECTIVE IVEPEST RATE %
Check of the to erican ]rational Bank Austin Texas S
ln-th - - ---h-edx- - -
- f -of 560,000.00, which represen ti or,r ooa1 Faith D-epo-
-sit (is attac-heret o-Y or
(nas been m)de available to you prior to the opening of this [AJ) and is subrnitted in
accordance with the terms as set forth in the Official Statewent and Notice of Sale and Bidding
Instructions.
We agree to accept delivery of and make payment for the Bonds at American National,•nk,
Austin, Texas, not later then 10:00 AM, CST, on Aoril 6. 19E2, or lhz ~a7ter on t;e date the
Bonds are t,:ndcred for delivery, pursdant to the tams set forth in the Notice of 531E and
gadding Instructions.
Pespectfully subnittfd,
Merrill T.vnch %rhite 1'eld Capital f'arkets croup
and Associates
-
Authuri;Cd Representative
0.CCEPTG,r,CF CLA'151`
.
The above and foregoing bid is hereby in all things 3cc~pted by the Ci y of Denton, Texas, this
the 2rd day of March, 1982.
%
ATTEST:
City Ser re lacy
Return of Good Faith Deposit Is hereby acknowledged: -
3REfAREO DY: FIRST SOUTIIWCST CW,iPAWo 900 MEACANTILr BANK BUILDING, CALLAS, TcXAS 75201
TABULATION OF BIDS
RECEIVED AT SALE OF
$3,000,000
CITY OF DENTON, TEXAS
'.LECTRIC SYSTEM REVENUE BONDS
SERIES 1932
.r _
GROSS LESS NET EFFECTIVE
ACCOUNT MANAGER INTEREST COST P-q E!4IU4 INTEREST COST INTEREST RATE
lei
I
If.
I
0°
~ n
a~Tco
C~ rp+ C r~
n 73'r~
~ O o0
'r1 H
n Nti
HnN•
F+r1
n H ra
y
n "-1
d1l
tJ rn n
A ~ N
V O
~'f1
I
4
ALAL