1998-085 ORDINANCE NO 98-
ORDINANCE
AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF CITY OF DENTON
GENERAL OBLIGATION BONDS, SERIES 1998, LEVYING THE TAX TO PAY
SAME, AND APPROVING AND AUTHORIZING INSTRUMENTS AND PROCEDURES
RELATING THERETO, AND PROVIDING AN EFFECTIVE DATE
THE STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON
WHEREAS, an election was held on February 24, 1996 at wluch the City Council was
authorized to issue certmn of the bonds heremafter authorized, and
WHEREAS, at said election the following bonds were authorized to be issued
Amount
Prop Amount Amount Being Previously Voted
No Authorized Issued Issued But Unissued.
1 $11,112,000 $3,050,000 $3,375,000 $4,687,000
2 7,238,000 3,540,000 1,390,000 2,308,000
3 7,650,000 3,070,000 1,050,000 3,530,000
WHEREAS, the bonds hereinafter authorized and designated were voted and are to be issued,
sold, and dehvered pursuant to Vernon's Ann Tex Clv St Articles 823 and 1175, Article IX of the
City's Itome Rule Charter, and other applicable laws, and
WHEREAS, it is considered to be in the best interest of the City that said interest beanng
bonds be issued, NOW, THEREFORE
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS
Section 1 AMOUNT AND PURPOSE OF THE BONDS The bond or bonds of the City
of Denton, Texas (the "Issuer") are hereby authorized to be issued and delivered in the aggregate
pnnclpal amount of $9,660,000, FOR THE PURPOSE OF THE ACQUISITION OF PROPERTY
AND MAKING IMPROVEMENTS FOR PUBLIC PURPOSES IN SAID CITY, TO-WIT
STREET AND TRAFFIC CONTROL IMPROVEMENTS, DRAINAGE IMPROVEMENTS AND
PARK IMPROVEMENTS
Section 2 DESIGNATION OF THE BONDS Each bond issued pursuant to ttus Ordinance
shall be designated "CITY OF DENTON GENERAL OBLIGATION BOND, SERIES 1998, and
initially, there shall be issued, sold, and delivered hereunder a single fully registered bond, w~thout
interest coupons, payable in installments of principal (the "Initial Bond"), but the ImUal Bond may
be assigned and transferred and/or converted into and exchanged for a like aggregate principal
amount of fully registered bonds, without interest coupons, having serial maturities, and in the
denormnation or denormnations of $5,000 or any integral multiple of $5,000, all in the manner herein-
after provided The term "Bonds" as used in this Ordinance shall mean and include collectively the
Imt~al Bond and all substitute bonds exchanged therefor, as well as all other substitute bonds and
replacement bonds issued pursuant hereto, and the term "Bonds" shall mean any of the Bonds
Section 3 INITIAL DATE, DENOMINATION, NUMBER, MATURITIES, INITIAL
REGISTERED OWNER, AND CHARACTERISTICS OF THE INITIAL BOND
(a) The Imtial Bond is hereby authorized to be issued, sold, and delivered hereunder as a
single fully registered Bond, w~thout interest coupons, dated April 1, 1998, in the denomination and
aggregate pnnclpal amount of $9,660,000, numbered R-I, payable in annual installments of pnnnipal
to the lmtial registered owner thereof, to-wit
WILLIAM R HOUGH & CO
or to the registered assignee or assignees of said Bond or any portion or portions thereof (in each
case, the "registered owner"), w~th the annual installments of pnnclpal of the Imtlal Bond to be
payable on the dates, respectively, and m the pnncipal amounts, respectively, stated in the FORM OF
INITIAL BOND set forth in ttus Ordinance
(b) The Imtlal Bond 0) may be prepaid or redeemed prior to the respective scheduled due
dates of installments of principal thereof, (ii) may be assigned and transferred, (iii) may be converted
and exchanged for other Bonds, (iv) shall have the characteristics, and (v) shall be signed and sealed,
and the pnnclpal of and interest on the Imtial Bond shall be payable, all as provided, and in the
manner required or indicated, in the FORM OF INITIAL BOND set forth in tbas Ordinance
Section 4 INTEREST The unpaid pnncipal balance of the Imtial Bond shall bear interest
from the date of the Inmal Bond to the respective scheduled due dates, or to the respective dates of
prepayment or redemption, of the installments of principal of the Initial Bond, and said interest shall
be payable, all in the manner proxaded and at the rates and on the dates stated in the FORM OF
INITIAL BOND set forth in ttus Ordinance
Sectaon 5 FORM OF INITIAL BOND The form of the Imtial Bond, including the form of
Registration Certfllcate of the Comptroller of Pubhc Accounts of the State of Texas to be endorsed
on the Imtlal Bond, shall be substantially as follows
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FORM OF INITIAL BOND
NO R-1 $9,660,000
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON GENERAL OBLIGATION BOND
SERIES 1998
THE CITY OF DENTON, m Denton County, Texas (the "Issuer"), being a pollt:cal
subdlv:slon of the State of Texas, hereby promases to pay to
WILLIAM R HOUGH & CO
or to tho registered ass~gne~ or ass~gn~s oftbas Bond or any portion or pomons hereof (m each case,
the "registered owner") the aggregate pnnc~pal amount of
$9,660,000
(NINE MILLION SIX HUNDRED SIXTY THOUSAND DOLLARS)
m annual installments of pnnclpal due and payable on February 15 ~n each of the years, and m the
respective pnnc~pal amounts, as set forth m the following schedule
PRINCIPAL PRINCIPAL
YEAR AMOUNT YEAR AMOUNT
1999 $485,000 2009 $485 000
2000 485,000 2010 485 000
2001 485,000 2011 480 000
2002 485,000 2012 480 000
2003 485,000 2013 480 000
2004 485,000 2014 480 000
2005 485,000 2015 480 000
2006 455,000 2016 480 000
2007 485,000 2017 480 000
2008 485,000 2018 4g0 000
and to pay interest, calculated on the bas~s of a 360-day year composed of twelve 30-day months,
from the date of tlus Bond heremaiter stated, on the balance of each such installment of pnnc~pal,
respectively, from t~me to t~me remaining unpaid, at the rates as follows
5 40% per annum on the above installment due m 1999
5 40% per annum on the above installment due ~n 2000
5 40% per annum on the above installment due ~n 2001
5 40% per annum on the above ~nstallment due ~n 2002
5 40% per annum on the above ,nstallment due m 2003
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5 40% Der annum on the above installment due in 2004
5 40% Der annum on the above installment due m 2005
4 60% Der annum on the above installment due in 2006
4 40% Der annum on the above installment due tn 2007
4 50% Der annum on the above installment due in 2008
4 60% Der annum on the above installment due in 2009
4 70% er annum on the above installment due in 2010
4 80% Der annum on the above installment due in 2011
4 90% Der annum on the above installment due in 2012
5 00% Der annum on the above installment due in 2013
5 00% er annum on the above installment due in 2014
5 00% Der annum on the above installment due in 2015
5 00% Der annum on the above installment due in 2016
5 00% Der annum on the above installment due in 2017
5 00% '~er annum on the above installment due m 2018
wath smd interest being first due and payable on February 15, 1999, and sennannually on each August
15 and February 15 thereafter while tlus Bond or any portion hereof is outstanding and unpaid
THE INSTALLMENTS OF PRINCIPAL OF AND THE INTEREST ON flus Bond are
payable m lawful money of the Umted States of America, without exchange or collection charges
The installments of pnnclpal and the interest on flus Bond are payable to the registered owner hereof
through the services of CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, DALLAS,
TEXAS, wluch is the "Paying Agent/Registrar" for ttus Bond Payment of all pnncipal of and ~nterest
on this Bond shall be made by the Paying Agent/Registrar to the registered owner hereof on each
principal and/or interest payment date by check, dated as of such date, drawn by the Paying
Agent/Registrar on, and payable solely from, funds of the Issuer mqmred by the ordinance authorizing
the issuance ofth~s Bond (the "Bond Ordinance") to be on deposit with the Paying Agent/Registrar
for such purpose as heremat~er proxaded, and such check shall be scm by the Paying Agent/Registrar
by Umted States mml, first-class postage prepaid, on each such principal and/or interest payment date,
to the registered owner hereof, at the address of the registered owner, as it appeared at the close of
business on the last day of the month next preceding each such date (the "Record Date") on the
Reg~strataon Books kept by the Paying Agent/Registrar, as herelnai~er described The Issuer cove-
nants wath the registered owner oftl~s Bond that on or before each pnnclpal and/or interest payment
date for ttus Bond it will make available to the Paying Agent/Registrar, from the "Interest and Slnl~ng
Fund" created by the Bond Ordinance, the amounts required to provide for the payment, in
immediately available funds, of all pnnclpal of and interest on this Bond, when due
IF THE DATE for the payment of the pnnclpal of or interest on flus Bond shall be a Saturday,
Sunday, a legal holiday, or a day on which bankang ~nstltutions in the City where the Paying
Agent/Registrar ~s located are authorized by law or executive order to close, then the date for such
payment shall be the next succeeding day whmh Ds not such a Saturday, Sunday, legal holiday, or day
on wluch banlong institutions are authorized to close, and payment on such date shall have the same
force and effect as ffmade on the original date payment was due
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THIS BOND has been authorized in accordance w~th the Const~tution and laws of the State
of Texas FOR THE PURPOSE OF THE ACQUISITION OF PROPERTY AND MAKING
IMPROVEMENTS FOR PUBLIC PURPOSES IN SAID CITY, TO-WIT STREET AND
TRAFFIC CONTROL IMPROVEMENTS, DRAINAGE IMPROVEMENTS AND PARK
IlVlPROVEIVIENTS
ON FEBRUARY 15, 2008, or on any date whatsoever thereafter, the unpaid installments of
pnnc~pal of this Bond may be prepaid or redeemed pr~or to their scheduled due dates, at the option
of the Issuer, vath funds derived from any available source, as a whole, or in part, and, lfm part, the
particular portion oftlus Bond to be prepaid or redeemed shall be selected and designated by the
Issuer (.pruv~ded that a port,on ofth~s Bond may be redeemed only in an integral multiple of $5,000),
at the prepayment or redemption price of the par or pnnc~pal amount thereof, plus accrued interest
to the date fixed for prepayment or redemption
AT LEAST 30 days prior to the date fixed for any such prepayment or redemption a written
not~ce of such prepayment or redemption shall be moaled by the Paying Agent/Registrar to the
registered owner hereof By the date fixed for any such prepayment or redemption due prows~on
shall be made by the Issuer vnth the Paying Agent/Registrar for the payment of the required prepay-
ment or redemption price for th~s Bond or the port~on hereof wbach is to be so prepmd or redeemed,
plus accrued interest thereon to the date fixed for prepayment or redemption If such written not~ce
of prepayment or redemption ~s g~ven, and ffdue provision for such payment ~s made, all as prowded
above, tt~s Bond, or the pomon thereofwl~ch is to be so prepaid or redeemed, thereby automatically
shall be treated as prepaid or redeemed prior to ~ts scheduled due date, and shall not bear interest
at~er the date fixed for ~ts prepayment or redemption, and shall not be regarded as being outstanding
except for the right of the registered owner to receive the prepayment or redemption price plus
accrued interest to the date fixed for prepayment or redemption from the Paying Agent/Registrar out
of the funds provided for such payment The Paying Agent/Registrar shall record m the Registration
Books all such prepayments or redemptions of pnnclpal of tbas Bond or any portion hereof
THIS BOND, to the extent of the unp~ud or unredeemed pnnc~pal balance hereof, or any
unpaid and unredeemed port~on hereof m any ~ntegral multiple of $5,000, may be assigned by the
initial registered owner hereof and shall be transferred only m the Registration Books of the Issuer
kept by the Paying Agent/Registrar acting m the capacity of registrar for the Bonds, upon the terms
and conditions set forth m the Bond Ordinance Among other requirements for such transfer, tbas
Bond must be presented and surrendered to the Paying Agent/Registrar for cancellation, together
w~th proper mstruments of assignment, m form and vath guarantee of signatures satisfactory to the
Paying AgentYReg~strar, ewden¢~ng assignment by the lmtial registered owner of this Bond, or any
port,on or port~ons hereof in any ~ntegral multiple of $5,000, to the assignee or assignees ~n whose
name or names tins Bond or any such port~on or portions hereof is or are to be transferred and
registered Any instrument or instruments of assignment satisfactory to the Paying Agent/Registrar
may be used to ewdence the assignment ofth~s Bond or any such portion or portions hereof by the
~mtial registered owner hereof A new bond or bonds payable to such assignee or assignees (which
then wall be the new registered owner or owners of such new Bond or Bonds) or to the lmtial
registered owner as to any port~on ofth~s Bond which is not being assigned and transferred by the
mmal registered owner, shall be dehvered by the Paying Agent/Registrar m conversion of and
exchange for this Bond or any portion or portions hereof, but solely m the form and manner as
5
provided in the next paragraph hereof for the convemon and exchange of this Bond or any portion
hereof The registered owner of this Bond shall be deemed and treated by the Issuer and the Paying
Agent/Registrar as the absolute owner hereof for all purposes, including payment and dtscharge of
hahihty upon flus Bond to the extent of such payment, and the Issuer and the Paying Agent/Registrar
shall not be affected by any not,ce to the contrary
AS PROVIDED above and m the Bond Ordinance, this Bond, to the extent of the unpmd or
unredeemed pnnclpal balance hereof, may be converted into and exchanged for a hke aggregate
principal amount of fully registered bonds, without interest coupons, payable to the assignee or
assignees duly designated m writing by the m~tlal registered owner hereof, or to the mmal registered
owner as to any portion of this Bond which ~s not being assigned and transferred by the ~nmal
registered owner, m any denormnation or denonunat~ons m any integral multiple of $5,000 (subJect
to the reqmrement heremat~er stated that each subsmute bond issued m exchange for any pomon of
this Bond shall have a s~ngle stated principal maturity date), upon surrender of this Bond to the
Paytng Agent/Registrar for cancellation, all in accordance w~th the form and procedures set forth in
the Bond Ordmance Ifthis Bond or any pomon hereof~s assigned and transferred or converted each
bond issued in exchange for any portion hereof shall have a single stated pnnclpal matunty date
corresp0ndmg to the due date of the installment of pnnclpal of this Bond or port~on hereof for which
the substitute bond ~s being exchanged, and shall bear interest at the rate apphcable to and borne by
such installment of pnnelpal or portion thereof Such bonds, respectively, shall be subJect to
redemption prior to maturity on the same dates and for the same prices as the corresponding
installment of principal of this Bond or portion hereof for which they are being exchanged No such
bond shall be payable m ~nstallmants, but shall have only one stated pnnc~pal matunty date AS
PROVIDED IN THE BOND ORDINANCE, TH/S BOND IN ITS PRESENT FORM MAY BE
ASSIGNED AND TRANSFERRED OR CONVERTED ONCE ONLY, and to one or more
assignees, but the bonds tssued and dehvered m exchange for this Bond or any portton hereof may
be assigned and transferred, and converted, subsequently, as prowded m the Bond Ordinance The
Issuer shall pay the Paying AgentYReg~strar's standard or customary fees and charges for transfemng,
converting, and exchanging this Bond or any pomon thereof, but the one requesting such transfer,
conversmn, and exchange shall pay any taxes or governmental charges reqmred to be prod w~th
respect thereto The Paying Agent/Registrar shall not be required to make any such assignment,
conversion, or exchange (0 dunng the period commencing w~th the close of business on any Record
Date and ending wath the opening of business on the next following pnnc~pal or interest payment date,
or, 00 w~th respect to any Bond or portion thereof called for prepayment or redemption prior to
maturity, within 45 days prior to its prepayment or redemption date
IN THE EVENT any Paying Agent/Registrar for flus Bond is changed by the Issuer, resigns,
or otherwise ceases to act as such, the Issuer has covenanted m the Bond Ordinance that it promptly
wdl appoint a competent and legally qualified substitute therefor, and promptly will cause written
nouce thereof to be mmled to the registered owner of this Bond
iT IS HEREBY certified, recited, and covenanted that this Bond has been duly and vahdly
voted, authorized, ~ssued, sold, and dehvered, that all acts, condmons, and things reqmred or proper
to be performed, ex~st, and be done precedent to or m the authorization, ~ssuance, and dehvery of this
Bond have been performed, crested, and been done m accordance vath law, that this Bond ~s a general
obhgatton of the Issuer, ~asued on the full faith and credit thereof, and that annual ad valorem taxes
6
sufficient to provide for the payment of the interest on and pnncipal of this Bond, as such interest
comes due and such pnnclpal matures, have been lewed and ordered to be levied against all taxable
property in the Issuer, and have been pledged irrevocably for such payment, wtth,n the limit pre-
scribed by law
BY BECOMING the registered owner of this Bond, the registered owner thereby
acknowledges all of the terms and prowsions of the Bond Ordinance, agrees to be bound by such
terms and provisions, acknowledges that the Bond Ordinance is duly recorded and avmlable for
inspection in the official manures and records of the governing body of the Issuer, and agrees that the
terms and provisions of tbas Bond and the Bond Ordinance constitute a contract between the
registered owner hereof and the Issuer
IN WITNESS WHEREOF, the Issuer has caused tbas Bond to be signed vath the manual
signature of the Mayor of the Issuer and countersigned and attested with the manual signature of the
City Secretary of the Issuer, has caused the official seal of the Issuer to be duly ;mpressed on this
Bond, and has caused fins Bond to be dated April 1, 1998
ATTEST CITY OF DENTON, TEXAS
By By
Jenmfer Walters Jack Ivhller
City Secretary, City of Denton, Texas Mayor, City of Denton, Texas
(CITY SEAL)
(INSERT BOND INSURANCE LEGEND, IF ANY)
FORM OF REGISTRATION CERTIFICATE OF THE
COMPTROLLER OF PUBLIC ACCOUNTS
(To be attached to Imtial Bond only)
COMPTROLLER'S REGISTRATION CERTIFICATE REGISTER NO
I hereby certify that tbas Bond has been exanuned, certified as to validity, and approved by
the Attorney General of the State of Texas, and that tbas Bond has been registered by the Comptroller
of Pubhc Accounts of the State of Texas
Witness my signature and seal this
Comptroller of Pubhc Accounts
of the State of Texas
(COMPTROLLER'S SEAL)
7
Section 6 ADDITIONAL CHARACTERISTICS OF THE BONDS Registration and
Transfer (a) The Issuer shall keep or cause to be kept at the pnnclpal corporate trust office of
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, DALLAS, TEXAS (the "Paytng
Agent/Registrar") books or records of the registration and transfer of the Bonds (the "Registration
Books*'), and the Issuer hereby appoints the Paying Agent/Registrar as its registrar and transfer agent
to keep such books or records and make such transfers and reglstrattons under such reasonable
regulattons as the Issuer and Paying Agent/Regtstrar may prescribe, and the Paying AgentfRegistrar
shall make such transfers and regtstrations as herein provtded The Paying Agent/Regtstrar shall
obtain and record m the Regtstratton Books the address of the regtstered owner of each Bond to
wt~ch payments w~th respect to the Bonds shall be totaled, as hereto prowded, but it shall be the duty
of each regtstered owner to nottfy the Paying Agent/Regtstrar in writing of the address to which
payments shall be marled, and such interest payments shall not be mailed unless such notice has been
g~ven The Issuer shall have the nght to respect the Registration Books dunng regular bustness hours
of the Paying Agent/Registrar, but otherwise the Paying AgenffRegtstrar shall keep the Registration
Books confidential and, unless otherwise required by law, shall not permit their tnspectton by any
other entity Regtstratlon of each Bond may be transferred m the Registration Books only upon
presentatton and surrender of such Bond to the Paying Agent/Registrar for transfer of registration
and caneellataon, together w~th proper written instruments of assignment, m form and w~th guarantee
of slguaturas satisfactory to the Paying Agent/Regtstrar, 0) evtdenclng the assignment of the Bond,
or any portion thereofm any integral multiple of $5,000, to the assignee or assignees thereof, and (n)
the right of such asstgnee or asstgnees to have the Bond or any such portion thereof registered tn the
name of such assignee or assignees Upon the assignment and transfer of any Bond or any portion
thereof, a new substitute Bond or Bonds shall be ~ssued in conversion and exchange therefor in the
manner herein prowded The Imtlal Bond, to the extent of the unpmd or unredeemed pnnclpal
balance thereof, may be assigned and transferred by the lmt~al registered owner thereof once only, and
to one or more assignees destguated m writing by the lmtlal registered owner thereof All Bonds
issued and dehvered tn conversion of and exchange for the Initial Bond shall be in any denormnatlon
or denommattons of any mtegral multiple of $5,000 (subJect to the requtrement hereinafter stated that
each substitute Bond shall have a smgle stated pnnc~pal matunty date), shall be tn the form prescnbed
In the FORM OF SUBSTITUTE BOND set forth m tt~s Ordinance, and shall have the charactensttcs,
and may be assigned, transferred, and converted as hereinafter provided If the Imtlal Bond or any
portion thereof is asstgned and transferred or converted the Imtlal Bond must be surrendered to the
Paying Agent/Registrar for cancellation, and each Bond issued tn exchange for any portion of the
Imtlal Bond shall have a single stated pnncipal maturity date, and shall not be payable m tnstallments,
and each such Bond shall have a pnncipal maturity date corresponding to the due date of the
installment of principal or portion thereof for wl~eh the substttute Bond is bemg exchanged, and each
such Bond shall be~x interest at the single rate apphcable to and borne by such installment of pnnclpal
or pomon thereof for wbach it ~s being exchanged If only a portion ofthe Imttal Bond ts asstgued
and transferred, there shall be dehvered to and regtstered tn the name of the lmttal registered owner
substitute Bonds m exchange for the unasslgued balance of the Initial Bond m the same manner as
if the initial registered owner were the assignee thereof If any Bond or portion thereof other than
the Imtlal Bond Is assigned and transferred or converted each Bond Issued m exchange therefor shall
have the same principal maturity date and bear interest at the same rate as the Bond for whteh n ~s
exchanged A form of assignment shall be pnnted or endorsed on each Bond, excepting the Imttal
Bond, winch shall be executed by the regtstered owner or its duly authorized attorney or
representative to evidence an assignment thereof Upon surrender of any Bonds or any portion or
portions thereof for transfer of registration, an authonzed representative of the Paying
Agent/Registrar shall make such transfer m the Registration Books, and shall deliver a new fully
registered substitute Bond or Bonds, hawng the characteristics herein described, payable to such
assignee or assignees (which then will be the registered owner or owners of such new Bond or
Bonds), or to the previous registered owner in case only a portion cfa Bond is being assigned and
transferred, all in conversion of and exchange for said assigned Bond or Bonds or any portion or
portlons~thereof, m the same form and manner, and v~th the same effect, as provided m Section 6(d),
below, for the conversion and exchange of Bonds by any registered owner cfa Bond The Issuer
shall pay the Paying Agent/Registrar's standard or customary fees and charges for mal~ng such trans-
fer and delivery cfa substitute Bond or Bonds, but the one requesting such transfer shall pay any
taxes or other governmental charges required to be paid with respect thereto The Paying
Agent/Registrar shall not be reqmred to make transfers of registration of any Bond or any portion
thereof0) during the period commencing w~th the close of business on any Record Date and ending
with the opemng of business on the next following pnncipal or interest payment date, or, (Il) w~th
respect to any Bond or any portion thereof called for redemption prior to maturity, w~thin 45 days
prior to its redemption date
(b) Ownership of Bonds The entity in whose name any Bond shall be registered m the
Registration Books at any time shall be deemed and treated as the absolute owner thereof for all
purposes of this Ordinance, whether or not such Bond shall be overdue, and the Issuer and the Paying
Agent/Registrar shall not be affected by any notice to the contrary, and payment of, or on account
of, the principal of, premium, if any, and interest on any such Bond shall be made only to such
registered owner All such payments shall be valid and effectual to satisfy and discharge the liability
upon such Bond to the extent of thc sum or sums so paid
(o) Payment of Bonds and Interest The Issuer hereby further appoints the Paying
A~;ent/Registrar to act as the paying agent for paying the principal of and interest on the Bonds, and
to act as, Its agent to convert and exchange or replace Bonds, all as provided in this Ordinance The
Paying Agent/Registrar shall keep proper records of all payments made by the Issuer and the Paying
AgenffReglstrar with respect to the Bonds, and of all conversions and exchanges of Bonds, and all
replacements of Bonds, as provided m this Ordinance However, in the event cfa nonpayment of
interest on a scheduled payment date, and for thirty (30) days thereafter, a new record date for such
interest payment (a "Sp~lal Record Date") w~ll be established by the Payang Agent/Registrar, if and
when funds for the payment of such interest have been received from the Issuer Notice of the
Special Record Date and of the scheduled payment date of the past due interest ("Special Payment
Date", which shall be fifteen (IS) days at~er the Special Record Date) shall be sent at least five (5)
businessldays prior to the Special Record Date by United States mall, first class postage prepaid, to
the address of each Holder of a Bond appearing on the registration books of the Paying
Agent/Registrar at the close of business on the 1Sth business day next preceding the date of mailing
of such notice
(d) COllV¢~'slon and Exchanc, e or Replacement. Authentication Each Bond issued and
delivered pursuant to this Ordinance, to the extent of the unpaid or unredeemed pnnclpal balance or
pnnclpal amount thereof, may, upon surrender of such Bond at the pnnclpal corporate trust office
of the Paying Agent/Registrar, together w~th a written request therefor duly executed by the
registered owner or the assignee or assignees thereof, or its or their duly anthonzed attorneys or
representatives, voth guarantee of signatures satisfactory to the Paying Agent/Registrar, may, at the
option of the registered owner or such assignee or assignees, as appropriate, be converted ~nto and
exchanged for fully registered bonds, w~thout interest coupons, in the form prescribed in the FORIVl
OF SUBSTITUTE BOND set forth in tlus Ordinance, m the denomination of $5,000, or any integral
multiple, of $5,000 (subject to the requirement heremai~er stated that each substitute Bond shall have
a smglelstated maturity date), as requested m writing by such registered owner or such assignee or
assignees, m an aggregate pnnc~pal amount equal to the unpaid or unredeemed pnncipal balance or
principal amount of any Bond or Bonds so surrendered, and payable to the appropriate registered
owner, assignee, or asslguees, as the case may be If the Imt~al Bond is assigned and transferred or
converted each substitute Bond ~ssued in exchange for any portion of the Imt~al Bond shall have a
single stated pnnclpal maturity date, and shall not be payable m installments, and each such Bond shall
have a pnnclpal maturity date corresponding to the due date of the installment of pnncipal or portion
thereof for winch the substitute Bond is being exchanged, and each such Bond shall bear interest at
the smgle rate apphcable to and borne by such installment of pnnc~pal or port~on thereof for which
it is being exchanged Ifa portion of any Bond (other than the Imtlal Bond) shall be redeemed prior
to its scheduled maturity as provided hereto, a substitute Bond or Bonds having the same maturity
date, beanng mterest at the same rate, m the denonunat~on or denonunat~ons of any integral multiple
of $5,000 at the request of the registered owner, and m aggregate pnnc~pal amount equal to the
unredeemed port,on thereof, will be ~ssued to the registered owner upon surrender thereof for
cancellation If any Bond or portion thereof (other than the Imtial Bond) is ass~gued and transferred
or converted, each Bond ~ssued m exchange therefor shall have the same pnnclpal maturity date and
bear interest at the same rate as the Bond for winch ~t is bemg exchanged Each substitute Bond shall
bear a letter and/or number to d~stmgu~sh tt from each other Bond The Paying Agent/Registrar shall
convert and exchange or replace Bonds as prowded hereto, and each fully registered bond delivered
in conversion of and exchange for or replacement of any Bond or port~on thereof as permitted or
requiredlby any provision of tins Ordmance shall constitute one of the Bonds for all purposes of tins
Ordinance, and may again be converted and exchanged or replaced It ~s specifically provided that
any Bond authenticated ~n conversxon of and exchange for or replacement of another Bond on or
prior to ~he first scheduled Record Date for the Imtlal Bond shall bear interest from the date of the
Imt~al Bond, but each substitute Bond so authenticated aider such first scheduled Record Date shall
bear interest from the interest payment date next preceding the date on winch such substitute Bond
was so authenticated, unless such Bond ~s authenticated aider any Record Date but on or before the
next following interest payment date, ~n winch case it shall bear interest from such next following
interest payment date, prowded, however, that ~f at the time of dehvery of any substitute Bond the
interest on the Bond for winch ~t ~s being exchanged is due but has not been paid, then such Bond
shall bear interest from the date to winch such interest has been paid in full THE INITIAL BOND
issued and dehvered pursuant to tins Ordinance is not required to be, and shall not be, anthent~cated
by the Paying Agent/Registrar, but on each substitute Bond ~ssued m conversion of and exchange for
or replacement of any Bond or Bonds ~ssued under this Ordinance there shall be pnnted a bond, in
the form substant~ally as follows
"PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been issued under the provisions of the Bond
Ordman~ described m tins Bond, and that this Bond has been issued in conversion of and exchange
for or replacement ora bond, bonds, or a portion ora bond or bonds of an issue winch originally was
10
approved by the Attorney General of the State of Texas and registered by the Comptroller of Public
Accounts of the State of Texas
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION, DALLAS, TEXAS
Pa3nng Agent/Registrar
Dated
By.
Authorized Representative"
An authorized representative of the Paying Agent/Registrar shall, before the delivery of any such
Bond, date and manually s~gn the above Bond, and no such Bond shall be deemed to be issued or out-
standing unless such Bond is so executed The Paying Agent/Registrar promptly shall cancel all
Bonds surrendered for conversion and exchange or replacement No additional ordinances, orders,
or resolutions need be passed or adopted by the govermng body of the Issuer or any other body or
person so as to accomplish the foregoing conversion and exchange or replacement of any Bond or
portion thereof, and the Paying AgenffReg~strar shall prowde for the pnntmg, execution, and delivery
of the submtute Bonds m the manner prescribed herein, and said Bonds shall be of type composmon
printed on paper w~th hthographed or steel engraved borders of customary weight and strength
Pursuant to Vernon's Ann Tex Clv St Art 717k-6, and particularly Section 6 thereof, the duty of
conversion and exchange or replacement of Bonds as aforesaid is hereby imposed upon the Paying
Agent/Registrar, and, upon the execution of the above Paying Agent/Reglstrar's Authentmatlon
Certificate, the converted and exchanged or replaced Bond shall be vahd, incontestable, and
enforceable in the same manner and w~th the same effect as the Imtial Bond wbach ongmally was
issued pursuant to thas Ordinance, approved by the Attorney General, and registered by the
Comptroller of Public Accounts The Issuer shall pay the Paying Agent/Registrar's standard or
customary fees and charges for transfernng, converting, and exchanging any Bond or any portion
thereof, but the one requesting any such transfer, conversion, and exchange shall pay any taxes or
governmental charges required to be pa~d with respect thereto as a eondmon precedent to the
exercise of such privilege of eonvemon and exchange The Paying Agent/Registrar shall not be
reqmred to make any such conversion and exchange or replacement of Bonds or any portion thereof
0) dunn$ the period commencing v~th the close of business on any Record Date and ending w~th the
opening of business on the next following pnncipal or interest payment date, or, (ii) w~th respect to
any Bond or portion thereof called for redemption prior to maturity, w~thm 45 days prior to its
redemption date
(e) In General All Bonds issued in conversion and exchange or replacement of any other
Bond or portion thereof, (0 shall be Issued in fully registered form, w~thout interest coupons, w~th
the pnncipal of and interest on such Bonds to be payable only to the registered owners thereof, (ii)
may be redeemed prior to their scheduled maturities, (iii) may be transferred and assigned, (iv) may
be converted and exchanged for other Bonds, (v) shall have the charactenmcs, (w) shall be signed
and sealed, and (vii) the pnnclpal of and interest on the Bonds shall be payable, all as provided, and
in the manner required or indicated, in the FORM OF SUBSTITUTE BOND set forth in this
Ordinance
11
(f) Paym~ll'[ of Fees and Chard, es The Issuer hereby covenants w~th the registered owners
of the Bonds that ~t wdl 0) pay the standard or customary fees and charges of the Paying
Agent/Registrar for its services wtth respect to the payment of the pnncipal of and interest on the
Bonds, when due, and (n) pay the fees and charges of the Paying Agent/Registrar for servmes w~th
respect to tho transfer of registration of Bonds, and with respect to the conversion and exchange of
Bonds solely to the extent above provtded ~n this Ordmance
(g) Substitute Paying Aoent/Remstrar The Issuer covenants vath the registered owners of
the Bonds that at all t~mes while the Bonds are outstanding the Issuer will provide a competent and
legally quahfied bank, trust company, financml mst~tutton, or other agency to act as and perform the
serwoes of Paying Agent/Registrar for the Bonds under tbas Ordinance, and that the Paying
Agent/Registrar will be one entity The Issuer reserves the right to, and may, at ~ts option, change
the Paying Agent/Registrar upon not loss than 120 days written notice to the Paying AgenffReg~strar,
to be effective not later than 60 days prior to the next pnncipal or ~nterest payment date after such
nottce In the event that the entity at any t~me acting as Paying Agent/Registrar (or ItS successor by
merger, acqmsltlon, or other method) should resign or otherwtse cease to act as such, the Issuer
covenants that it wdl promptly appoint a competent and legally quahfied bank, trust company,
financial mst~tution, or other agency to act as Paying Agent/Registrar under ttus Ordinance Upon
any change m the Paying AgenffReg~strar, the previous Paying AgenffReg~strar shall promptly
transfer and dehver the Registration Books (or a copy thereof), along w~th all other pertinent books
and records relating to the Bonds, to the new Paying Agent/Registrar designated and appointed by
the Issuer Upon any change m the Pa)ang Agent/Registrar, the Issuer promptly will cause a written
notice thereof to be sent by the new Paying Agent/Registrar to each registered owner of the Bonds,
by Umted States mini, first-class postage prepmd, which notice also shall gtve the address of the new
Paying Agent/Registrar By accepting the posttion and perforrmng as such, each Paying Agent/Regis-
trar shall be deemed to have agreed to the prows~ons oftbas Ordinance, and a certified copy ofth~s
Ordtnance shall bo dehvered to each Paying Agent/Registrar
Section 7 FORM OF SUBSTITUTE BONDS The form of all Bonds ~ssued mconverston
and exchange or replacement of any other Bond or port~on thereof, ~ncluding the form of Paying
Agent/Registrar's Bond to be pnnted on each of such Bonds, and the Form of Assignment to be
pnnted on each of the Bonds, shall be, respect~voly, substantially as follows, w~th such appropriate
variations, omissions, or ~nsemons as are permitted or reqmred by th~s Ordinance
12
FORM OF SUBSTITUTE BOND
(Book-Entry Only Legend, ~f appropriate)
NO UNITED STATES OF AMERICA PRINCIPAL AMOUNT
STATE OF TEXAS $
COUNTY OF DENTON
CITY OF DENTON GENERAL OBLIGATION BOND
SERIES 1998
ORIGINAL DATE
INTEREST RATE MATURITY DATE OF ISSUE CUSIP NO
%
ON THE MATURITY DATE specified above the CITY OF DENTON, in Denton County,
Texas (the "Issuer"), being a pohtlcal subdivision of the State of Texas, hereby prormses to pay to
~ or to the registered
assignee hereof(either being hereinafter called the "registered owner") the pnnc~pal amount of
and to pay interest thereon, calculated on the basis of a 360-day year composed of twelve 30-day
months, from Apnl 1, 1998, to the maturity date specified above, or the date of redemption prior to
maturity, at the interest rate per annum specified above, with interest being first due and payable on
February 15, 1999, and semiannually on each August 15 and February 15 thereafter, except that if
the date,of authentication oftl~s Bond is later than the first Record Date (hereinafter defined), such
principal amount shall bear interest from the interest payment date next preceding the date of
authentication, unless such date of authentication is after any Record Date (hereinafter defined) but
on or before the next following interest payment date, in which case such pnnclpal amount shall bear
interest from such next following interest payment date
TI-IF. PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the
Umted States of America, without exchange or collection charges The pnnclpal oftlus Bond shall
be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity or
upon the date fixed for its redemption prior to maturity, at the pnnclpal corporate trust office of
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, DALLAS, TEXAS, which is the
"Paying Agent/Registrar" for this Bond The payment of interest on this Bond shall be made by the
Paying Agent/Registrar to the registered owner hereof on each interest payment date by check, dated
as of such interest payment date, drawn by the Paying Agent/Registrar on, and payable solely from,
funds of the Issuer required by the ordinance authorizing the issuance of the Bonds (the "Bond
Ordinance") to be on deposit with the Paying Agent/Registrar for such purpose as hereinafter
provided, and such check shall be sent by thc Paying Agent/Registrar by Umted States mall, first-class
postage prepaid, on each such interest payment date, to the registered owner hereof, at the address
of the registered owner, as it appeared at the close of business on the last day of the month next
preceding each such date (the "Record Date") on the Registration Books kept by the Paying
Agent/Registrar, as hereinafter described However, the payment of such interest may be made by
13
any other method acceptable to the Paying Agent/Regmtrar and requested by, and at the risk and
expense of, the regmtered owner hereof Any accrued interest due upon the redemption of thru Bond
prior to maturity as provided herein shall be paid to the registered owner at the pnnclpal corporate
trust office of the Paying Agent, rReglstrar upon presentation and surrender of this Bond for redemp-
tion and payment at the pnncipal corporate trust office of the Paying Agent/Regmtrar The Issuer
covenants with the registered owner of ttus Bond that on or before each pnncipal payment date,
interest ~payment date, and accrued interest payment date for this Bond it will make available to the
Paying Agent/Registrar, fi.om the "Interest and Sm~ng Fund" created by the Bond Ordinance, the
amounts required to prowde for the payment, in immediately available funds, of all pnnclpal of and
interest on the Bonds, when due
IF THE DATE for the payment of the prmmpal of or interest on tbas Bond shall be a Saturday,
Sunday, a legal holiday, or a day on which banl~ng institutions in the City where the Paying
Agent/Regmtrar is located are authorized by law or executive order to close, then the date for such
payment shall be the next succeeding day wbach is not such a Saturday, Sunday, legal holiday, or day
on wtuch banking m~tutlons are anthonzed to close, and payment on such date shall have the same
force and effect as if made on the original date payment was due
THIS BOND is one of an issue of Bonds lmtlally dated April 1, 1998, anthonzed in
accordance vath the Constitution and laws of the State of Texas in the principal amount of
$9,660,000, FOR THE PURPOSE OF THE ACQUISITION OF PROPERTY A_ND MAKING
IMPROVEMENTS FOR PUBLIC PURPOSES IN SAID CITY, TO-V/IT STREET A_ND
TRAFEIC CONTROL IMPROVEMENTS, DRAINAGE IMPROVEMENTS AND PARK
IMPROVEMENTS
ON FEBRUARY 15, 2008, or on any date whatsoever therea~er, the Bonds of this Series
may be redeemed prior to their scheduled maturities, at the option of the Issuer, v~th funds derived
fi.om any avmlable and lawful source, as a whole, or in part, and, lfm part, the particular Bonds, or
portions thereof, to be redeemed shall be seleoted and designated by the Issuer (prowded that a
pomon ora Bond may be redeemed only in an integral multiple of $5,000), at the redemption price
of the par or pnnmpal amount thereof, plus accrued interest to the date fixed for redemption
AT LEAST 30 days prior to the date fixed for any redemption of Bonds or portions thereof
prior to mamn~y a written notice of such redemp~nn shall be pubhshad once in a financial publication,
journal, lot reporter of general circulation among securities dealers in The City of New York, New
York (including, but not lmmted to, The Bond Buyer and The Wall Street Journal), or in the State of
Texas (Including, but not limited to, The Texas Bond Reporter) Such notice also shall be sent by
the Pay~og Agent/Regmtrar by Umted States mall, first-class postage prepmd, not less than 30 days
pnor to the date fixed for any such redemptmn, to the registered owner of each Bond to be redeemed
at its address as it appeared on the 45th day prior to such redemption date, provided, however, that
the faflt~re to send, mml, or receive such notice, or any defect therein or in the sending or mmhng
thereof, shall not affect the validity or effectiveness of the proceedings for the redemption of any
Bond, a~d it is hereby specifically provMed that the publication of such notice as required above shall
be the o~ly notice actually required in connection w~th or as a prerequisite to the redemption of any
Bonds or portions thereof By the date fixed for any such redemption due prowmon shall be made
w~th the Paying Agent/Regmtrar for the payment of the required redemption price for the Bonds or
14
portions thereof which are to be so redeemed, plus accrued interest thereon to the date fixed for
redemption If such written notice of redemption is published and if due provision for such payment
is made, all as pro,haled above, the Bonds or portions thereof winch are to be so redeemed thereby
automatically shall be treated as redeemed prior to their scheduled maturities, and they shall not bear
interest after the date fixed for redemption, and they shall not be regarded as being outstanding except
for the right of the registered owner to receive the redemption price plus accrued interest from the
Paying Agent/Registrar out of the funds provided for such payment Ifa portion of any Bond shall
be redeemed a substitute Bond or Bonds having the same maturity date, bearmg interest at the same
rate, in any denomination or denominations m any integral multiple of $5,000, at the written request
of the registered owner, and in aggregate pnncipal amount equal to the unredeemed portion thereof,
wdl be issued to the registered owner upon the surrender thereof for cancellation, at the expense of
the Issuer, all as provided in the Bond Ordinance
THIS BOND OR ANY PORTION OR PORTIONS HEREOF IN ANY INTEGRAL
MULTIPLE OF $5,000 may be assigned and shall be transferred only in the Registration Books of
the Issuer kept by the Paying Agent/Registrar acting in the capacity of registrar for the Bonds, upon
the terms and conditions set forth in the Bond Ordinance Among other requirements for such
assignment and transfer, tins Bond must be presented and surrendered to the Paying Agent/Registrar,
together ,oath proper instruments of assignment, m form and w~th guarantee of signatures satisfactory
to the Paying Agem/Reg~strar, evidencing assignment of tins Bond or any portion or portions hereof
m any integral multiple of $5,000 to the assignee or assignees in whose name or names tins Bond or
any suoh portion or portions hereof is or are to be transferred and registered The form of
Assignment pnnted or endorsed on tins Bond shall be executed by the registered owner or its duly
authorized attorney or representative, to evidence the assignment hereof A new Bond or Bonds
payable to such assignee or assignees (winch then w.ll be the new registered owner or owners of such
new Bond or Bonds), or to the prexaous registered owner in the case of the assignment and transfer
of only a portion of tins Bond, may be delivered by the Paying Agent/Registrar in conversion of and
exchange for tins Bond, all in the form and manner as provided in the next paragraph hereof for the
convemon and exchange of other Bonds The Issuer shall pay the Paying Agent/Reglstrar's standard
or customary fees and charges for makang such transfer, but the one requesting such transfer shall pay
any taxes or other governmental charges required to be prod w~th respect thereto The Paying
Agent/Registrar shall not be required to make transfers of registration of tins Bond or any portion
hereof0) dunng the period commencing vath the close of business on any Record Date and ending
w~th the opemng of business on the next following principal or interest payment date, or, (ii) w~th
respect to any Bond or any portion thereof called for redemption prior to maturity, wltinn 45 days
prior to its redemption date The registered owner of tins Bond shall be deemed and treated by the
Issuer and the Paying Agent/Registrar as the absolute owner hereof for all purposes, including
payment and discharge ofhabdity upon this Bond to the extent of such payment, and the Issuer and
the Paying Agent/Registrar shall not be affected by any notice to the contrary
ALL BONDS OF THIS SERIES are lssuable solely as fully registered bonds, without interest
coupons, in the denonnnatlon of any integral multiple of $5,000 As provided in the Bond
Ordinance, tins Bond, or any unredeemed portion hereof, may, at the request of the registered owner
or the assignee or assignees hereof, be converted into and exchanged for a like aggregate pnncipal
amount of fully registered bonds, vathout interest coupons, payable to the appropriate registered
owner, assignee, or assignees, as the ease may be, having the same maturity date, and bearing interest
15
at the same rate, in any denomination or denominations m any integral multiple of $5,000 as requested
in venting by the appropriate registered owner, assignee, or assignees, as the case may be, upon sur-
render 0ftins Bond to the Paying Agent/Registrar for cancellation, all in accordance w~th the form
and procedures se{ forth in the Bond Ordinance The Issuer shall pay the Paying Agent/Registrar's
standard or customary fees and charges for transfernng, converting, and exchanging any Bond or any
portion thereof, but the one requesting such transfer, conversion, and exchange shall pay any taxes
or governmental charges required to be paid with respect thereto as a condition precedent to the
exercise of such pnwlege of conversion and exchange The Paying Agent/Registrar shall not be
reqmred to make any such conversion and exchange (l) during the period commencing with the close
of business on any Record Date and ending w~th the opening of business on the next following
principal or interest payment date, or, (ii) w~th respect to any Bond or portion thereof called for
redemption prior to maturity, w~tinn 45 days prior to its redemption date
IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the Issuer, resigns,
or otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly
will appoint a competent and legally qualified substitute therefor, and will promptly cause written
notice thereof to be totaled to the registered owners of the Bonds
IT IS HEREBY certified, recited, and covenanted that this Bond has been duly and validly
voted, authorized, issued, sold, and delivered, that all acts, conditions, and tinngs required or proper
to be performed, erast, and be done precedent to or in the authorization, issuance, and delivery of tins
Bond have been performed, erasted, and been done in accordance w~th law, that this Bond is a general
obhgat~on of the Issuer, issued on the full faith and credit thereof, and that annual ad valorem taxes
sufficient to prowde for the payment of the interest on and pnnclpal of tbas Bond, as such interest
comes due and such pnnclpal matures, have been levied and ordered to be levied against all taxable
property in the Issuer, and have been pledged irrevocably for such payment, vatinn the haut pre-
scribed by law
BY BECOMING the registered owner of tins Bond, the registered owner thereby
acknowledges all of the terms and prowsions of the Bond Ordinance, agrees to be bound by such
terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for
inspection m the official minnies and records of the govermng body of the Issuer, and agrees that the
terms and prowsions of tins Bond and the Bond Ordinance constitute a contract between each
registered owner hereof and the Issuer
IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or
facsimile signature of the Mayor of the Issuer and countersigned and attested w~th the manual or
facsirmle signature of the City Secretary of the Issuer, and has caused the official seal of the Issuer
to be duly impressed, or placed in facsmule, on this Bond
ATTEST CITY OF DENTON, TEXAS
By By
Jenmfer Walters Jack Mailer
City Secretary, City of Denton, Texas Mayor, City of Denton, Texas
(CITY SEAL)
16
FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
(To be executed if this Bond is not accompanied by an executed Registration
Certificate of the Comptroller of Public Accounts of the State of Texas)
It is hereby certified that this Bond has been issued under the provisions of the Bond
Ordmtmce described in ttus Bond, and that tlus Bond has been issued in conversion of and exchange
for or replacement ora bond, bonds, or a portion ora bond or bonds of an issue which originally was
approved by the Attorney General of the State of Texas and registered by the Comptroller of Public
Accounts of the State of Texas
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION, DALLAS, TEXAS
Paying Agent/Registrar
Dated
By
Authorized Representative
(INSERT BOND INSURANCE LEGEND, IF ANY)
FORM OF ASSIGNMENT
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned registered owner oftbas Bond, or duly authorized
representative or attorney thereof, hereby assigns th~s Bond to
/ /
(Asslgnee's Social (pnnt or typewrite Assignee's name and
Security or Taxpayer address, including zip code)
Identlfi0ation Number)
and hereby irrevocably constitutes and appoints
attomey ~o transfer the reg~stration oftlus Bond on the Paying AgenffR. eg~strar's Registration Books
with full power of substitution in the prenuses
Dated
17
Signature Guaranteed
NOTICE Signature(s) must be Registered Owner
guaranteed by an eligible guarantor NOTICE This signature must correspond
institution participating in a w~th the name of the Registered Owner
securities transfer association appeanng on the face of tins Certificate in
recognized signature guarantee every partlcolar without alteration or
program enlargement or any change whatsoever
Section 8 TAX LEVY A special Interest and Stoking Fund (the "Interest and Sinkang
Fund") is hereby created solely for the benefit of the Bonds, and the Interest and Sinking Fund shall
be established and maintained by the Issuer at an official depository bank of the Issuer The Interest
and Stoking Fund shall be kept separate and apart from all other funds and accounts of the Issuer, and
shall be used only for paying the interest on and pnnclpal of the Bonds All ad valorem taxes levied
and collected for and on account of the Bonds shall be deposited, as collected, to the credit of the
Interest and Sinking Fund During each year wlule any of the Bonds or interest thereon are
outstanding and unpaid, the govermng body of the Issuer shall compute and ascertain a rate and
amount of ad valorem tax wbach will be sufficient to raise and produce the money required to pay the
interest on the Bonds as such interest becomes due, and to provide and maintain a smkang fund
adequate to pay the pnncipal of its Bonds as such pnncipal matures (but never less than 2% of the
original principal amount of the Bonds as a stoking fund each year), and said tax shall be based on the
latest approved tax rolls of the Issuer, wath full allowance being made for tax dehnquencles and the
cost of tax collectaon Smd rate and amount of ad valorem tax is hereby levied, and is hereby ordered
to be lewed, against all taxable property m the Issuer for each year whale any of the Bonds or interest
thereon are outstanding and unpmd, and said tax shall be assessed and collected each such year and
deposited to the cre&t of the aforesaid Interest and Slnkang Fund Said ad valorem taxes sufficient
to provade for the payment of the interest on and pnnclpal of the Bonds, as such interest comes due
and such pnncipal matures, are hereby pledged for such payment, wltban the hmat prescribed by law
Section 10 DEFEASANCE OF BONDS (a) Any Bond and the interest thereon shall be
deemed to be paid, rem'ed, and no longer outstanding (a "Defeased Bond") witban the meamng oftbas
OrdinanCe, except to the extent provided in subsection (d) ofttus Section 10, when payment of the
pnnclpal of such Bond, plus interest thereon to the due date (whether such due date be by reason of
maturity, upon redemption, or otherwise) either (0 shall have been made or caused to be made in
accordance w~th the temps thereof (including the giving of any required notice of redemption), or (ii)
shall have been provided for on or before such due date by irrevocably depositing with or malong
avaflabl~ to the Paying Agent/Registrar for such payment (1) lawful money of the Umted States of
Amenca~sufficient to make such payment or (2) Government Obhgations which mature as to pnnclpal
and interest in such amounts and at such times as will insure the availability, w~thout reinvestment,
of suflficlent money to prowde for such payment, and when proper arrangements have been made by
the Issuer w~th the Paying Agent/Registrar for the payment of its services until all Defeased Bonds
shall have become due and payable At such time as a Bond shall be deemed to be a Defeased Bond
hereunder, as aforesaid, such Bond and the interest thereon shall no longer be secured by, payable
from, or entitled to the benefits of, the ad valorem taxes herein levied and pledged as provided in this
18
Ordinance, and such pnncipal and interest shall be payable solely from such money or Government
Obhgal~lons
(b) Any moneys so deposited wnh the Paying Agent/Re~strar may at the written direction
of the Issuer also be invested m Government Obligations, maturing in the amounts and times as
hereinbefore set forth, and all income from such Government Obligations received by the Paying
Agent/Re~strar wl~ch is not reqmred for the payment of the Bonds and Interest thereon, with respect
to which such money has been so deposited, shall be turned over to the Issuer, or deposited as
directed m writing by the Issuer
(c) The term "Government Obligations" as used m this Section shall mean direct
obligations of the Umted States of America, including obligations the pnnclpal of and interest on
wtuch are unconditionally guaranteed by the Umted States of America, which may be Umted States
Treasury obligations such as its State and Local Government Series, wbach may be In book-entry
form
(d) Until all Defeased Bonds shall have become due and payable, the Paying
AgenffReg~strar shall perform the sermces of Paying Agent/Registrar for such Defeased Bonds the
same as ffthey had not been defeased, and the Issuer shall make proper arrangements to provide and
pay for such services as required by flus Ordinance
Section 11 DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS
(a) Replacement Bonds In the event any outstanding Bond is damaged, mutilated, lost, stolen, or
destroyed, the Paying AgentYReg~strar shall cause to be printed, executed, and delivered, a new bond
of the same pnnclpal amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or
destroyed Bond, m replacement for such Bond m the manner heremal~er provided
(b) Application for Replacement Bonds Application for replacement of damaged,
mutilated, lost, stolen, or destroyed Bonds shall be made by the registered owner thereof to the
Paling Agent/Registrar In every case of loss, theft, or destruction of a Bond, the registered owner
applying for a replacement bond shall furmsh to the Issuer and to the Paying AgentJReglstrar such
security or mdemmty as may be reqmred by them to save each of them harmless from any loss or
damage with respect thereto Also, m every case of loss, theft, or destruction of a Bond, the
registered owner shall furnish to the Issuer and the Paying AgenffReglstrar evidence to their
satisfaction of the loss, theft, or destruction of such Bond, as the case may be In every case of
damage or mutdation ora Bond, the registered owner shall surrender to the Paying Agent/Registrar
for cancellation the Bond so damaged or mutilated
{c) No Default Occurred Notwithstanding the foregoing provisions oftbas Section, in
the event of any such Bond shall have matured, and no default has occurred which ~s then contlnumg
in the payment of the pnncipal of, redemption premium, if any, or interest on the Bond, the Issuer
may authorize the payment of the same (wathout surrender thereof except ,n the case of a damaged
or mutilated Bond) instead ofissumg a replacement Bond, provided secunty or indemnity is furmshed
as above provaded m flus Section
19
(d) Charge for Issuing Replacement Bonds Prior to the issuance of any replacement
bond, the Paymg Agent/Registrar shall charge the registered owner of such Bond wroth all legal,
printing, and other expenses mn connectmon therewith Every replacement bond issued pursuant to the
provismons of this Sectmon by vwtue of the fact that any Bond ms lost, stolen, or destroyed shall
constmtute a contractual obhgatmon of the Issuer whether or not the lost, stolen, or destroyed Bond
shall be found at any tmme, or be enforceable by anyone, and shall be entmtled to all the benefits of this
Ordmnance equally and proportionately w~th any and all other Bonds duly mssued under this Ordanance
(e) A~hon~ for Issuing Replacement Bonds In accordance w~th Sectaon 6 of Vernon's
Ann Tex Cay St Art 717k-6, this Sectmn of this Ordinance shall constatute authority for the
mssuance of any such replacement bond w~thout necessity of further actmon by the govermng body of
the Issuer or any other body or person, and the duty of the replacement of such bonds ms hereby
authorized and amposed upon the Paymng Agent/Registrar, and the Paymng Agent/Regastrar shall
authentmate and dehver such Bonds an the form and manner and w~th the effect, as provaded mn
Sectmon 6(d) of this Ordinance for Bonds mssued an convemon and exchange for other Bonds
Sectaon 12 COVENANTS REGARDING TAX-EXEMPTION The Issuer covenants to
refrain from tahng any actaon which would adversely affect, or to take such actaon to assure, the
treatment of the Bonds as obhgataons described an sectaon 103 of the Internal Revenue Code of 1986,
as amended (the "Code"), the interest on which as not includable mn the "gross mncome" of the holder
for purposes of federal ancome taxataon In furtherance thereof, the Issuer covenants as follows
(a) to take any actaon to assure that no more than 10 percent of the proceeds of
the Bonds or the projects financed therewith (less amounts deposated to a reserve fund, mf any)
are used for any "private busmess use", as defined m section 141(b)(6) of the Code, or if more
than 10 percent of the proceeds or the projects financed therewmth are so used, such amounts,
whether or not recemved by the Issuer, w~th respect to such pnvate busaness use, do not, under
the terms of this Ordinance or any undeflyang arrangement, darectly or andarectly, secure or
promde for the payment of more than 10 percent of the debt servme on the Bonds, in
contraventmon of sectaon 14 l(b)(2) of the Code,
(b) to take any actaon to assure that an the event that the "private business use"
described m subsectmon (a) hereof exceeds five percent of the proceeds of the Bonds or the
projects financed therewith (less amounts deposated mnto a reserve fund, ff any) then the
amount m excess of five percent ms used for a "private business use" which ms "related" and not
"dmspropomonate", w~ttun the meamng of section 141(b)(3) of the Code, to the governmental
use,
(c) to take any actaon to assure that no amount which ms greater than the lesser of
$5,000,000, or five percent of the proceeds of the Bonds (less amounts deposated into a
reserve fund, mf any) ms, dmrectly or indirectly, used to finance loans to persons, other than state
or local governmental units, an contravention of section 141 (c) of the Code,
(d) to refrain from talang any action which would ntherwmse result m the Bonds
being treated as "private actavlty bonds" w~thin the meamng of sectmon 141(b) of the Code,
20
(e) to refrain from taking any action that would result in the Bonds being
"federally guaranteed" within the meaning of section 149(b) of the Code,
(f) to refrain from using any portion of the proceeds of the Bonds, d~rectly or
indirectly, to acquire or to replace funds which were used, directly or indirectly, to acquire
investment property (as defined m section 148(b)(2) of the Code) wluch produces a materially
higher yield over the term of the Bonds, other than investment property acquired with --
(1) proceeds of the Bonds ~nvested for a reasonable temporary period of
3 years or less, or m the case ora refunding bonds, for a penod of 30 days or less until
such proceeds are needed for the purpose for which the Bonds are issued,
(2) amounts invested in a bona fide debt service fund, w~tban the meamng
of section 1 148-1(b)of the Treasury Regulations, and
(3) amounts deposited m any reasonably required reserve or replacement
fund to the extent such amounts do not exceed 10 percent of the stated pnncipal
amount (or, m the case ofa d~seount, the issue pnce) of the Bonds,
(g) to otherwise restrict the use of the proceeds of the Bonds or amounts treated
as proceeds of the Bonds, as may be necessary, so that the Bonds do not othervase
contravene the reqturements of section 148 of the Code (relating to arbitrage), section 149(g)
of the Code (relating to hedge bonds), and, to the extent applicable, section 149(d) of the
Code (relating to advance refundings), and
(h) to pay to the Umted States of America at least once dunng each five-year
penod (begnmmg on the date ofdehvery of the Bonds) an amount that ~s at least equal to 90
percent of the "Excess Earnings~', wthm the meaning of section 148(f) of the Code and to pay
to the Umted States of America, not later that 60 days after the Bonds have been pa~d in full,
100 percent of the amount then required to be paid as a result of Excess Earnings under
section 148(0 of the Code
The Issuer understands that the term "proceeds" includes "disposition proceeds" as defined
~n the Treasury Regulations and, in the case of refunding bonds, transferred proceeds 0fany) and
proceeds of the refunded bonds expended prior to the date of issuance of the Bonds It ~s the
understanding of the Issuer that the covenants contamed here~n are mtended to assure comphance
with tho Code and any regulations or ruhngs promulgated by the U S Department of the Treasury
pursuant thereto In the event that regulations or rulings are hereafter promulgated which modify,
or expand prowsions of the Code, as apphcable to the Bonds, the Issuer will not be reqmred to
comply w~th any covenant contained herein to the extent that such modification or expansion, in the
oplmon ofnat~onally-recogmzed bond counsel, will not adversely affect the exemption from federal
income taxation of interest on the Bonds under section 103 of the Code In the event that regulations
or ruhngs are hereafter promulgated wl~ch impose additional requirements wluch are applicable to
the Bonds, the Issuer agrees to comply w~th the additional requirements to the extent necessary and
reasonably possible, in the op~on of natlonally-recogmzed bond counsel, to preserve the exemption
from federal income taxation of interest on the Bonds under section 103 of the Code In furtherance
21
of such retention, the Issuer hereby authorizes and directs the Mayor of the Issuer to execute any
documents, cemficates or reports required by the Code and to make such elections, on behalf of the
Issuer, wl~ch may be penmtted by the Code as are consistent w~th the purpose for the ~ssuance of the
Bonds
In order to faeflltate compliance w~th the above covenant (h), a "Rebate Fund" is hereby
estabhshed by the Issuer for the sole benefit of the Untted States of America, and such fund shall not
be subject to the claim of any other person, including without limitation, the bondholders The
Rebate Fund ~s established for the addlttonal purpose ofcomphance with section 148 of the Code
Section 13 ALLOCATION OF, AND LIMITATION ON, EXPENDITURES FOR THE
PROJECT The Issuer covenants to account for the expenditure of sale proceeds and investment
earnings to be used for the purposes described m Section 1 of this Ordinance (each such purpose
referred to hereto and Section 14 hereof as a "Project") on ~ts books and records by allocating
proceeds to expenditures wattun 18 months of the later of the date that (1) the expenditure ~s made,
or (2) the Project is completed The foregoing notwithstanding, the Issuer shall not expend sale
proceeds or mvestment earnings thereon more than 60 days after the later of(l) the fifth anniversary
of the delivery of the Bonds, or (2) the date the Bonds are retired, unless the Issuer obtains an opinion
of nataonally-recogmzed bond counsel that such expenditure will not adversely affect the tax-exempt
status of the Bonds For purposes hereof, the Issuer shall not be obhgated to comply w~th this
covenant flit obtains an op~mon that such failure to comply will not adversely affect the excludability
for federal income tax purposes from gross income of the interest
Section 14 DISPOSITION OF PROJECT The Issuer covenants that the property
constituting the ProJect will not be sold or otherwise d~sposed in a transaction resulting m the receipt
by the Issuer of cash or other compensation, unless the Issuer obtains an op~mon of nationally-
recograzed bond counsel that such sale or other d~sposlt~on will not adversely affect the tax-exempt
status of the Bonds
Section 15 CUSTODY, APPROVAL, AND REGISTRATION OF BONDS, BOND
COUNSEL'S OPINION, CUSIP NUMBERS, PREAMBLE AND INSURANCE The Mayor of the
Issuer ~s hereby authorized to have control of the Imtlal Bond issued hereunder and all necessary
records and proceedings pertaimng to the Imtlal Bond pending its delivery and ~ts investigation,
examination, and approval by the Attorney General of the State of Texas, and its reg~stratton by the
Comptroller of Pubhc Accounts of the State of Texas Upon registration of the Imtlal Bond said
Comptroller of Pubhc Accounts (or a deputy designated m writing to act for smd Comptroller) shall
manually sign the Comptroller's Registration Cemficate on the Initial Bond, and the seal of said
Comptroller shall be ~mpressed, or placed ~n facsimile, on the Inmal Bond The approwng legal
opinion of the Issuer's Bond Counsel and the assigned CUSIP numbers may, at the option of the
Issuer, be pnnted on the Imtlal Bond or on any Bonds ~ssued and dehvered in conversion of and
exchange or replacement of any Bond, but neither shall have any legal effect, and shall be solely for
the convenience and reformation of the registered owners of the Bonds The preamble to this
Ordinance Is hereby adopted and made a part hereof for all purposes If insurance ~s obtained on any
of the Bonds, the Imt~al Bond and all other Bonds shall bear an appropriate legend concerning
insurance as provided by the ~nsurer
22
Section 16 SALE OF INITIAL BOND The Imt~al Bond ~s hereby sold and shall be
delivered to Wllham R Hough & Co, for cash for the par value thereof and accrued interest thereon
to date of dehvery, plus a cash premmm of $-0- It ~s hereby oi~c~ally found, determined, and
declared that the Imt~al Bond has been sold at pubhc sale to the b~dder offenng the lowest interest
cost, ~er receiving sealed b~ds pursuant to an Of[legal Notice of Sale and Bidding Instructions and
Oi~elal Statement dated March 24, 1998, prepared and d~stnbuted m connection with the sale of the
Imt~al Bond Sand O~c~al Notice of Sale and B~dd~ng Instructions and Official Statement, and any
addenda, supplement, or amendment thereto have been and are hereby approved by the Issuer, and
their use m the offer and sale of the Bonds ~s hereby approved It ~s further officially found,
determined, and declared that the statements and representations contained ~n sa~d Official Not,ce of
Sale and Official Statement are true and correct ~n all material respects, to the best knowledge and
behef of the City Council
Section 17 INTEREST EARNINGS ON BOND PROCEEDS Interest earmngs derived
from the mvestmant of proceeds from the sale of the Imt~al Bond shall be used along w~th other bond
proceeds for the acquisition and construction of the ~mprovements for which the Bonds are ~ssued,
prowded that after completion of such nnprovements, ~fany of such interest earnings remann on hand,
such ~nterest earmngs shall be deposited m the Interest and Smk~ng Fund It is further prowded,
however, that any interest earnings on bond proceeds wtuch are required to be rebated to the Umted
States of America pursuant to Section 12 hereof m order to prevent the Bonds from being arbitrage
bonds shall be so rebated and not considered as interest earmngs for the purposes oftlus Section
Section 18 DTC REGISTRATION The Bonds ~mtaally shall be ~ssued and dehvered m such
manner that no physical d~smbutlon of the Bonds will be made to the pubhc, and the Depository Trust
Company ("DTC"), New York, New York, ~mt~ally will act as depository for the Bonds DTC has
represented that ~t ~s a lamted purpose trust company ~ncorporated under the laws of the State of New
York, a member of the Federal Reserve System, a "cleanng corporation" w~flun the meamng of the
New York Urnform Commercial Code, and a "cleanng agency" registered under Section 17A of the
federal Secuntaas Exchange Act of 1934, as amended, and the Issuer accepts, but ~n no way venfies,
such representations The Imt~al Bond anthonzed by tbas Ordinance shall be dehvered to and
registered m the name of the Purchaser However, ~t ~s a condition of dehvery and sale that the
Purchaser, ~mmed~ately after such dehvery, shall cause the Paying Agent/Registrar, as prowded for
m flus Ordinance, to cancel sand Imt~al Bond and deliver m exchange therefor a substitute Bond for
each maturity of such Imt~al Bond, w~th each such substitute Bond to be registered ~n the name of
CEDE & CO, the nominee of DTC, and ~t shall be the duty of the Paying Agent/Registrar to take
such a~on It ~s expected that DTC will hold the Bonds on behalf of the Purchaser and/or The DTC
Partac~pants, as defined and described m the O~c~al Statement referred to and approved m Section
16 hereof(the "DTC Participants") So long as each Bond ~s registered ~n the name of CEDE & CO,
the Paying Agent/Registrar shall treat and deal w~th DTC ~n all respects the same as ff~t were the
actual and beneficial owner thereof It ~s expected that DTC will manntann a book entry system wbach
will ~dent~fy beneficial ownership of the Bonds by DTC Pamc~pants m ~ntegral amounts of $5,000,
w~th transfers ofownerstnp being effected on the records of DTC and the DTC Participants pursuant
to rules and regulations estabhshed by them, and that the substitute Bonds m~t~ally deposited w~th
DTC shall be immobilized and not be further exchanged for substitute Bonds except as hereinafter
prowded The Issuer ~s not responsible or hable for any functions ofDTC, w~ll not be responsible
for paying any fees or charges w~th respect to its services, w~ll not be responsible or hable for
23
mamtamang, superwsmg, or rewevnng the records of DTC or the DTC Part~ctpants, or protecting any
~nterests or rights of the beneficial owners of the Bonds It shall be the duty of the Purchaser and the
DTC Participants to make all arrangements wxth DTC to establish this book-entry system, the
beneficial ownersbap of the Bonds, and the method of paying the fees and charges of DTC The
Issuer does not represent, nor does it in any way covenant that the ~mtxal book-entry system
estabhshed w~th DTC ~ be maintained m the future The Issuer reserves the right and option at any
t~me in the future, m its sole discretion, to ternunate the DTC (CEDE & CO ) book-entry only reg~s-
tratlon requirement described above, and to permit the Bonds to be registered ~n the name of any
owner If the Issuer exercises ~ts right and option to temaxnate such reqmrement, ~t shall gtve written
not,ce of such terrmnat~on to the Paymg Agent/Registrar and to DTC, and thereaiter the Paying
Agent/Keg~strar shall, upon presentation and proper request, register any Bond m any name as
prowded for m tbas Ordinance Notwithstanding the antial establishment of the foregoing book-entry
system w~th DTC, fi for any reason any of the originally delivered substnute Bonds xs duly filed with
the Paying Agent/Registrar with proper request for transfer and subst~tutaon, as prowded for ~n th~s
Ordinance, substitute Bonds w~ll be duly dehvered as prowded ~n th~s Ordinance, and there w~ll be
no assurance or representation that any book-entry system w~ll be mamtaaned for such Bonds
Sectxon 19 CONTINUING DISCLOSURE (a) Annual Reports 0) The Issuer shall
prowde annually to each NRMSIK and any SID, witban s~x months aider the end of each fiscal year
ending in or after 1998, financxal mfonnatxon and operating data w~th respect to the Issuer of the
general type included m the final Oflicml Statement authorized by Section 16 ofttus Ordinance, being
the ~nformat~on described m Extubl~; A hereto, wtuch Exbabxt Is attached to and mcorporated ~n th~s
Ordinance as ffwntten word for word hereto Any flnancxal statements so to be prowded shall be (1)
prepared ~n accordance wth the accounting pnnciples described m Exhibit A hereto, or such other
accountmg pnnc~ples as the Issuer may be required to employ from txme to t~me pursuant to state law
or regulation, and (2) audited, ~fthe Issuer conumsslons an audit of such statements and the audtt ~s
completed wltlun the period during wluch they must be provided If the audit of such financial
statements is not complete w~tlun such period, then the Issuer shall prowde unaudited financml
statements by the required trane and w~ll prowde audited financial statements for the apphcable fiscal
year to each NRMSIR and any SID, when and if the audit report on such statements become
avmlable
(n) If the Issuer changes ~ts fiscal year, ~t wll notxfy each NRMSIR and any SID of the
change (and of the date of the new fiscal year end) prior to the next date by whxch the Issuer
otherwuse would be required to prowde financial mformat~on and operating data pursuant to th~s
Section The financial mformat~on and operating data to be prowded pursuant to ttus Section may
be set forth m full m one or more documents or may be included by specific reference to any
document 0ncludmg an offictal statement or other offenng document, ~f ~t ~s available from the
MSRB) that theretofore has been prowded to each NRMSIR and any SID or filed wnh the SEC
24
(b) Material Event Notices. The Issuer shall notify any SID and either each NRMSIR or the
MSRB, m a timely manner, of any of the following events with respect to the Bonds, if such event
~s material within the meaning of the federal securities laws
1 Pnnclpal and interest payment delinquencies,
2 Non-payment related defaults,
3 Unscheduled draws on debt service reserves reflecting financial difficulties,
4 Unscheduled draws on credit enhancements reflecting financial difficulties,
5 Substitution of credit or hquidlty providers, or their failure to perform,
6 Adverse tax oplmons or events affecting the tax-exempt status of the Bonds,
7 Mod~fications to rights of holders of the Bonds,
8 Bond calls,
9 Defeasances,
10 Release, substitution, or sale of property secunng repayment of the Bonds, and
I 1 Rating changes
The Issuer shall notify any SID and either each NRMSIR or the MSRB, m a tmmely manner, of any
failure by the Issuer to prowde financial mfonnat~on or operating data m accordance w~th subsection
(a) ofttus Section by the time reqmred by such subsection
(c) Ltrmtataons. D~sclauners. and Amendments 0) The Issuer shall be obhgated to observe
and perform the covenants specified in this Section for so long as, but only for so long as, the Issuer
remains an "obhgated person" w~th respect to the Bonds wathln the meamng of the Rule, except that
the Issuer m any event will g~ve the notice required by Subsection (b) hereof of any Bond calls and
defeasance that cause the Issuer to no longer be such an "obligated person"
(Il) The prowsions of this Section are for the sole benefit of the registered owners and
beneficial owners of the Bonds, and nothing In ttus Section, express or implied, shall g~ve any benefit
or any legal or equitable right, remedy, or claim hereunder to any other person The Issuer
undertakes to pro,nde only the financial reformation, 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 mformat~on that may be relevant or material to a complete presentation of the
Issuer's financial results, cond~tion, or prospects or hereby undertake to update any information
provided In accordance w~th th~s Section or otherwise, except as expressly prowded hereto The
Issuer does not make any representation or warranty concemng such information or rots usefulness
to a decision to Invest m or sell Bonds at any future date
25
(m) UNDER NO CIRCUMSTANCES SHALL THE ISSUER, ITS OFFICERS, AGENTS
AND EMPLOYEES, BE LIABLE TO THE REGISTERED OWNER OR BENEFICIAL OWNER
OF ANN' BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT, FOR DAMAGES
RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE ISSUER, 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
(tv) No default by the Issuer m obserwng or pefforrmng its obhgattons under ttus Sectton
shall comprise a breach of or default under the Ordinance for purposes of any other prowston of tins
Ordinance Nottung m tins Sectton ts intended or shall act to d~sclatm, watve, or otherwtse hnut the
duttes of the Issuer under federal and state securities laws
(v) The prov~stons of tins Sectton may be amended by the Issuer from ttme to ttme to adapt
to changed c~rcumstances that arise from a change m legal requtrements, a change in law, or a change
tn the tdent~ty, nature, status, or type ofoperattons of the Issuer, but only if(l) the provisions of tins
Section, as so amended, would have perrmtted an underwriter to purchase or sell Bonds tn the
primary offenng of the Bonds m compliance wtth the Rule, tahng tnto account any amendments or
mterpretattons of the Rule since such offenng as well as such changed ctrcumstances and (2) either
(a) the reflstered owners cfa majority m aggregate pnnc~pal amount (or any greater amount required
by any other provtston ofttus Ordinance that anthonzes such an amendment) of the outstandtng
Bonds consent to such amendment or (b) a person that ts unaffiliated w~th the Issuer (such as
nattonally recogmzed bond counsel) deterrmned that such amendment wtll not materially tmpmr the
interest of the registered owners and beneficial owners of the Bonds If the Issuer so amends the
prowstons of this Section, ~t shall include w~th any amended financial tnformatton or operating data
next proxaded m accordance vath subsectton (a) of tins Section an explanatton, ~n narrative form, of
the reason for the amendment and of the impact of any change tn the type of financial information or
operating data so provtded The Issuer may also amend or repeal the provlstons of tins continuing
dtsclosure agreement ffthe SEC amends or repeals the apphcable provtslon of the Rule or a court of
final jurisdiction enters judgment that such prows~ons of the Rule are mvaltd, but only ff and to the
extent that the prov~stons ofttus sentence would not prevent an undenvnter from lawfully purchasing
or selhng Bonds m the primary offenng of the Bonds
(d) Deikntlons. As used in tins Section, the following terms have the meanings ascribed to
such terms below
"MSRB" means the Mumctpal Securities Rulemahng Board
"NRMSIR" means each person whom the SEC or Its staff'has determmed to be a nattonally
recogrnzed mumclpal secunttes mformat~on reposttory w~thm the meamng of the Rule from time to
ttme
"Rule" means SEC Rule 1502-12, as amended from ttme to ttme
"SEC" means the Umted States Secunttes and Exchange Commission
26
"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
Section 20 FURTHER PROCEDURES The Mayor of the Issuer, the City Secretary of the
Issuer, and all other officers, employees, and agents of the Issuer, and each of them, shall be and they
are hereby expressly authorized, empowered, and directed from time to time and at any time to do
and perform all such acts and things and to execute, acknowledge, and deliver in the name and under
the corporate seal and on behalf of the Issuer all such instruments, whether or not hereto mentioned,
as may be necessary or desirable in order to carry out the terms and provisions of tins Bond
Ordinance, the Bonds, the sale of the Bonds, and the Notice of Sale and Official Statement, and the
Assistant City Manager/Finance of the City shall cause the expenses of issuance of the Bonds to be
paid from the proceeds of sale of the Imtial Bond or from any other lawfully available funds of the
Issuer In case any officer whose signature shall appear on any Bond shall cease to be such officer
before the dehvery of such Bond, such signature shall nevertheless be valid and sufficient for all
purposes the same as if such officer had remmned in office until such delivery
Section 21 OPEN MEETINGS The City Council has found and determined that the
meeting at winch tins Ordinance is considered is open to the public and that notice thereof was given
in accordance vnth the provmons of the Texas Open Meetings, Law, Tex Gov't Code, Chapter 551,
as amended
Sec'aon 22 EFFECTIVE DATE Tins Ordinance shall become effective immediately upon
its passage and approval
27
PASSED AND APPROVED th~s the 7th, day of April, 1998
Jack ]
ATTEST
Jenmfer Walters, C~ty Secretary
APPROVED AS TO LEGAL FORM
Herbert L Prouty, City Attorney
By Y/~ ,~~/
28
EXHIBIT A
DESCRIPTION OF ANNUAL FINANCIAL INFORMATION
The follow~ng mformat~on ~s referred to ~n Section 19 ofth~s Ordinance
Annual Fmancml Statements and Operating Data
The financial information and operating data w~th respect to the Issuer to be prowded annually
~n accordance vath such Section are as specified (and included m the Appendix or under the tables
of the Official Statement referred to) below
Tables numbered 1 through 14, mclus~ve, under the captions "Tax Information", "Debt
Service Reqmrements" and "Financial Information" m the Official Statement
Appendix B m the Official Statement
Accounting Principles
The accounting pnnc~ples referred to m such Section are the accounting principles described
m the notes to the financial statements referred to m the paragraph above
LAW OFFICES
M~:CALL PARKHURST & HORTON LL P
~500 conGRESS AVENUE 717 NORTH HARWOOD 700 N ST NIARYS StREet
1250 ONE AMERICAN CENTER NINTH FLOOR }225 ONE RIVERWALK PLACE
AUSTIN TEXAS 787013248 DALLAS TEXAS 752016587 SAN ANTONIO TEXAS 78205 3503
April 7, 1998
Honorable Mayor and Couned of
the City of Denton
Denton, Texas
Re C~ty of Denton General Obhgat~on Bond, Series 1998, $9,660,000
Gentlemen
In eomphance w~th Section 9 02 and Seeuon 9 04 of the City Charter of the C~ty of Denton, you are
advised that the b~ds for the captioned issue received by the C~ty pursuant to ItS Officml Statement and Not,ce
of Sale and B~ddmg Instructions dated April 7, 1998, have been tabulated, and that we find, based on calculations
performed by F~rst Southwest Company, as fmaneml adv~sor, that the bid of a syndicate managed or headed by
the following
WILLIAM R HOUGH & CO
~ath the Bond beanng interest on each mstallmant of pnuclpal, respeeuvely, at the rates therem specified, with
such bidder to pay par and aeemed interest to date of delivery for said Bond, plus a cash prermum of $-0-, ~s the
lowest and best bid received, and we recommend that it be accepted
We further cemfy that we have examined the ordinance presently placed before the Mayor and Council
for the purpose of authonzmg the ~ssuance of smd Bond, and, m our opnuon, the said proposed bond ordinance
is legal, and the Bond to be issued thereunder vall be a general obligation of the C~ty payable from ad valorem
taxes levied against all taxable property m the City, and pledged ~rrevocably for such payment, within the lmut
prescribed by law
Respectfully,