1993-103ORDINANCE NO. 93-&3
ORDINANCE
AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF CITY OF
DENTON GENERAL OBLIGATION REFUNDING BONDS, SERIES 1993-A,
LEVYING THE TAX TO PAY SAME, AND APPROVING AND
AUTHORIZING INSTRUMENTS AND PROCEDURES RELATING THERETO
THE STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON
WHEREAS, the City of Denton, Texas, heretofore has duly issued, and there are presently
outstanding, the following Series of Tax supported obligations:
City of Denton General Obligation Refunding Bonds, Series 1985, dated November
1, 1985, scheduled to mature on February 15, 1996 through February 15, 1999,
aggregating $6,395,000 (and being all but $175,000 in principal amount of the
outstanding bonds of said series scheduled to mature on and after February 15, 1996
to and including February 15, 1999);
City of Denton General Obligation Bonds, Series 1987, dated April 1, 1987, scheduled
to mature on July 1, 1998 through July 1, 2005, aggregating $1,400,000 (and being all
of the outstanding bonds of said series scheduled to mature on and after July 1,1998);
City of Denton General Obligation Bonds, Series 1988, dated January 1, 1988,
scheduled to mature on July 1, 1999 through July 1, 2008, aggregating $2,000,000 (and
being all of the outstanding bonds of said series scheduled to mature on and after July
1, 1999);
City of Denton General Obligation Bonds, Series 1989, dated January 1, 1989,
scheduled to mature on July 1, 2000 through July 1, 2009, aggregating $2,000,000 (and
being all of the outstanding bonds of said series scheduled to mature on and after July
1, 2000);
City of Denton Certificates of Obligation, Series 1987, dated January 1, 1987,
scheduled to mature on July 1, 1998 through July 1, 2006, aggregating $225,000 (and
being all of the outstanding bonds of said series scheduled to mature on and after July
1, 1998);
City of Denton Certificates of Obligation, Series 1991, dated April 1, 1991, scheduled
to mature on July 1, 1997 through July 1, 2006, aggregating $150,000 (and being all
of the outstanding bonds of said series scheduled to mature on and after July 1,1997);
(collectively, the "Outstanding Obligations"), in the aggregate principal amount of $11,795,000; and
WHEREAS, the City Council of the City of Denton deems it necessary and advisable to
refund the Outstanding Obligations, and to authorize, issue, and deliver the bonds hereinafter
described; and
WHEREAS, the bonds hereinafter authorized are to be issued, sold, and delivered pursuant
to Vernon's Ann. Tex. Civ. St. Article 717k, the City's Home Rule Charter and other applicable laws;
THAT:
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
principal amount of $13,315,000, FOR THE PURPOSE OF OBTAINING FUNDS REQUIRED TO
REFUND $11,795,000 IN AGGREGATE PRINCIPAL AMOUNT OF TAX SUPPORTED
OBLIGATIONS OF THE CITY OF DENTON, TEXAS.
Section 2. DESIGNATION OF THE BONDS. Each bond issued pursuant to this Ordinance
shall be designated: "CITY OF DENTON GENERAL OBLIGATION REFUNDING BOND,
SERIFS 1993-A", and initially there shall be issued, sold, and delivered hereunder a single fully
registered bond, without interest coupons, payable in installments of principal (the "Initial Bond"),
but the Initial 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 denomination or denominations of $5,000 or any integral multiple of $5,000,
all in the manner hereinafter provided The term "Bonds" as used in this Ordinance shall mean and
include collectively the Initial 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 Initial Bond is hereby authorized to be issued, sold, and delivered hereunder as a
single fully registered Bond, without interest coupons, dated JUNE 1, 1993, in the denomination and
aggregate principal amount of $13,315,000, numbered R-1, payable in annual installments of principal
to the initial registered owner thereof, to-wit:
MERRILL LYNCH & CO.
or to the registered assignee or assignees of said Bond or any portion or portions thereof (in each
case, the "registered owner"), with the annual installments of principal of the Initial Bond to be
payable on the dates, respectively, and in the principal amounts, respectively, stated in the FORM
OF INITIAL BOND set forth in this Ordinance.
(b) The Initial Bond (i) 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 principal of and interest on the Initial Bond shall be payable, all as provided, and in the
manner required or indicated, in the FORM OF INITIAL BOND set forth in this Ordinance.
Section 4. INTEREST. The unpaid principal balance of the Initial Bond shall bear interest
from the date of the Initial 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 provided and at the rates and on the dates stated in the FORM
OF INITIAL BOND set forth in this Ordinance.
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Section 5. FORM OF INITIAL BOND. The form of the Initial Bond, including the form
of Registration Certificate of the Comptroller of Public Accounts of the State of Texas to be
endorsed on the Initial Bond, shall be substantially as follows:
FORM OF INITIAL BOND
NO. R-1 $13,315,000
UNTIED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF DENTON
CTTY OF DENTON GENERAL OBLIGATION REFUNDING BOND
SERIES 1993-A
THE CITY OF DENTON, in Denton County, Texas (the "Issuer" or the "City"), being a
political subdivision of the State of Texas, hereby promises to pay to
MERRILL LYNCH & CO.,
as representative to the Underwriters
or to the registered assignee or assignees of this Bond or any portion or portions hereof (in each
case, the "registered owner") the aggregate principal amount of
$13,315,000
(THIRTEEN MILLION THREE HUNDRED FIFTEEN THOUSAND DOLLARS)
in annual installments of principal due and payable on FEBRUARY 15 in each of the years, and in
the respective principal amounts, as set forth in the following schedule:
PRINCIPAL PRINCIPAL
YEAR AMOUNT YEAR AMOUNT
1994
$ 195,000
2002
S 645,000
1995
275,000
2003
635,000
1996
1,900,000
2004
625,000
1997
1,945,000
2005
615,000
1998
1,830,000
2006
420,000
1999
2,020,000
2007
370,000
2000
665,000
2008
365,000
2001
655,000
2009
155,000
and to pay interest, calculated on the basis of a 360-day year composed of twelve 30-day months, from
the date of this Bond hereinafter stated, on the balance of each such installment of principal,
respectively, from time to time remaining unpaid, at the rates as follows:
3.00% per annum on the above installment due in 1994
3.55% per annum on the above installment due in 1995
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3.90% per annum on the above installment due in 1996
4.20% per annum on the above installment due in 1997
4.25% per annum on the above installment due in 1998
4.40% per annum on the above installment due in 1999
4.60% per annum on the above installment due in 2000
4.80% per annum on the above installment due in 2001
5.00% per annum on the above installment due in 2002
5.00% per annum on the above installment due in 2003
5.10% per annum on the above installment due in 2004
5.25% per annum on the above installment due in 2005
5.30% per annum on the above installment due in 2006
5.40% per annum on the above installment due in 2007
5.40% per annum on the above installment due in 2008
5.40% per annum on the above installment due in 2009
with said interest being payable on FEBRUARY 15, 1994, and semiannually on each FEBRUARY
15 and AUGUST 15 thereafter while this Bond or any portion hereof is outstanding and unpaid.
THE INSTALLMENTS OF PRINCIPAL OF AND THE INTEREST ON this Bond are
payable in lawful money of the United States of America, without exchange or collection charges.
The installments of principal and the interest on this Bond are payable to the registered owner hereof
through the services of NATIONSBANK OF TEXAS, N.A., DALLAS, TEXAS, which is the "Paying
Agent/Registrar" for this Bond. Payment of all principal of and interest 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 required by the ordinance authorizing the issuance of this Bond (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 the Paying Agent/Registrar by United States mail, 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 15th 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. The Issuer covenants with the registered owner of
this Bond that on or before each principal and/or interest payment date for this Bond it will make
available to the Paying Agent/Registrar, from the "Interest and Sinking Fund" created by the Bond
Ordinance, the amounts required to provide for the payment, in immediately available funds, of all
principal of and interest on this Bond, when due.
IF THE DATE for the payment of the principal of or interest on this Bond shall be a
Saturday, Sunday, a legal holiday, or a day on which banking institutions in the City where the Paying
Agent/Registrar is located are authorized by law or executive order to close, then the date for such
payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day
on which banking institutions are authorized to close; and payment on such date shall have the same
force and effect as if made on the original date payment was due.
THIS BOND has been authorized in accordance with the Constitution and laws of the State
of Texas FOR THE PURPOSE OF OBTAINING FUNDS REQUIRED TO REFUND $11,795,000
IN AGGREGATE PRINCIPAL AMOUNT OF TAX SUPPORTED OBLIGATIONS OF THE
CITY OF DENTON, TEXAS.
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ON FEBRUARY 15, 2002, or on any date whatsoever thereafter, the unpaid installments of
principal of this Bond may be prepaid or redeemed prior to their scheduled due dates, at the option
of the Issuer, with funds derived from any available source, as a whole, or in part, and, if in part, the
particular portion of this Bond to be prepaid or redeemed shall be selected and designated by the
Paying Agent/Registrar (provided that a portion of this Bond may be redeemed only in an integral
multiple of $5,000), at the prepayment or redemption price of the par or principal 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
notice of such prepayment or redemption shall be mailed by the Paying Agent/Registrar to the
registered owner hereof. By the date fixed for any such prepayment or redemption due provision
shall be made by the Issuer with the Paying Agent/Registrar for the payment of the required prepay-
ment or redemption price for this Bond or the portion hereof which is to be so prepaid or redeemed,
plus accrued interest thereon to the date fixed for prepayment or redemption. If such written notice
of prepayment or redemption is given, and if due provision for such payment is made, all as provided
above, this Bond, or the portion thereof which is to be so prepaid or redeemed, thereby automatically
shall be treated as prepaid or redeemed prior to its scheduled due date, and shall not bear interest
after the date fixed for its 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 in the Registration
Books all such prepayments or redemptions of principal of this Bond or any portion hereof.
THIS BOND, to the extent of the unpaid or unredeemed principal balance hereof, or any
unpaid and unredeemed portion hereof in any integral multiple of $5,000, may be assigned by the
initial registered owner hereof 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 transfer, this
Bond must be presented and surrendered to the Paying Agent/ Registrar for cancellation, together
with proper instruments of assignment, in form and with guarantee of signatures satisfactory to the
Paying Agent/Registrar, evidencing assignment by the initial registered owner of this Bond, or any
portion or portions hereof in any integral multiple of $5,000, to the assignee or assignees in whose
name or names this Bond or any such portion 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 evidence the assignment of this Bond or any such portion or portions hereof by the
initial registered owner hereof. A new bond or bonds payable to such assignee or assignees (which
then will be the new registered owner or owners of such new Bond or Bonds) or to the initial
registered owner as to any portion of this Bond which is not being assigned and transferred by the
initial registered owner, shall be delivered by the Paying Agent/Registrar in conversion of and
exchange for this Bond or any portion or portions hereof, but solely in the form and manner as
provided in the next paragraph hereof for the conversion 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 discharge of
liability 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.
AS PROVIDED above and in the Bond Ordinance, this Bond, to the extent of the unpaid
or unredeemed principal balance hereof, may be converted into and exchanged for a like aggregate
principal amount of fully registered bonds, without interest coupons, payable to the assignee or
assignees duly designated in writing by the initial registered owner hereof, or to the initial registered
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owner as to any portion of this Bond which is not being assigned and transferred by the initial
registered owner, in any denomination or denominations in any integral multiple of $5,000 (subject
to the requirement hereinafter stated that each substitute bond issued in exchange for any portion
of this Bond shall have a single stated principal maturity date), upon surrender of this Bond to the
Paying Agent/Registrar for cancellation, all in accordance with the form and procedures set forth in
the Bond Ordinance. If this Bond or any portion hereof is assigned and transferred or converted
each bond issued in exchange for any portion hereof shall have a single stated principal maturity date
corresponding to the due date of the installment of principal of this Bond or portion hereof for which
the substitute bond is being exchanged, and shall bear interest at the rate applicable to and borne by
such installment of principal 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 in installments, but shall have only one stated principal maturity date. AS
PROVIDED IN TIME BOND ORDINANCE, THIS BOND IN ITS PRESENT FORM MAY BE
ASSIGNED AND TRANSFERRED OR CONVERTED ONCE ONLY, and to one or more
assignees, but the bonds issued and delivered in exchange for this Bond or any portion hereof may
be assigned and transferred, and converted, subsequently, as provided in the Bond Ordinance. The
Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for transferring,
converting, and exchanging this 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. The Paying Agent/Registrar shall not be required to make any such assignment,
conversion, or exchange (i) during the period commencing with the close of business on any Record
Date and ending with the opening of business on the next following principal or interest payment
date, or, (ii) with 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 this Bond 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 promptly will cause written
notice thereof to be mailed to the registered owner of this Bond.
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 things required or proper
to be performed, exist, and be done precedent to or in the authorization, issuance, and delivery of
this Bond have been performed, existed, and been done in accordance with law; that this Bond is a
general obligation of the Issuer, issued on the full faith and credit thereof; and that annual ad
valorem taxes sufficient to provide for the payment of the interest on and principal of this Bond, as
such interest comes due and such principal matures, have been levied and ordered to be levied
against all taxable property in the Issuer, and have been pledged irrevocably for such payment, within
the limit prescribed by law.
BY BECOMING the registered owner of this Bond, the registered owner thereby
acknowledges all of the terms and provisions 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 in the official minutes and records of the governing body of the Issuer, and agrees that the
terms and provisions of this Bond and the Bond Ordinance constitute a contract between the
registered owner hereof and the Issuer.
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IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual
signature of the Mayor of the Issuer and countersigned with the manual signature of the City
Secretary of the Issuer, has caused the official seal of the Issuer to be duly impressed on this Bond,
and has caused this Bond to be dated JUNE 1, 1993.
City Secretary, Mayor,
City of Denton, Texas City of Denton, Texas
(CITY SEAL)
FORM OF REGISTRATION CERTIFICATE OF THE
COMPTROLLER OF PUBLIC ACCOUNTS:
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO.
I hereby certify that this Bond has been examined, certified as to validity, and approved by
the Attorney General of the State of Texas, and that this Bond has been registered by the
Comptroller of Public Accounts of the State of Texas.
Witness my signature and seal this
(COMPTROLLER'S SEAL)
Comptroller of Public Accounts
of the State of Texas
Section 6. ADDITIONAL CHARACTERISTICS OF THE BONDS. Registration and
Transfer. (a) The Issuer shall keep or cause to be kept at the principal corporate trust office of
NATIONSBANK OF TEXAS, N.A., DALLAS, TEXAS (the "Paying 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 registrations under such reasonable regulations as the Issuer and
Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such transfers and
registrations as herein provided. The Paying Agent/Registrar shall obtain and record in the Regis-
tration Books the address of the registered owner of each Bond to which payments with respect to
the Bonds shall be mailed, as herein provided; but it shall be the duty of each registered owner to
notify the Paying Agent/Registrar in writing of the address to which payments shall be mailed, and
such interest payments shall not be mailed unless such notice has been given. The Issuer shall have
the right to inspect the Registration Books during regular business hours of the Paying
Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books
confidential and, unless otherwise required by law, shall not permit their inspection by any other
entity. Registration of each Bond may be transferred in the Registration Books only upon
presentation and surrender of such Bond to the Paying Agent/Registrar for transfer of registration
and cancellation, together with proper written instruments of assignment, in form and with guarantee
of signatures satisfactory to the Paying Agent/Registrar, (i) evidencing the assignment of the Bond,
or any portion thereof in any integral multiple of $5,000, to the assignee or assignees thereof, and
(ii) the right of such assignee or assignees to have the Bond or any such portion thereof registered
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in 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 issued in conversion and exchange therefor
in the manner herein provided. The Initial Bond, to the extent of the unpaid or unredeemed
principal balance thereof, may be assigned and transferred by the initial registered owner thereof once
only, and to one or more assignees designated in writing by the initial registered owner thereof. All
Bonds issued and delivered in conversion of and exchange for the Initial Bond shall be in any
denomination or denominations of any integral multiple of $5,000 (subject to the requirement
hereinafter stated that each substitute Bond shall have a single stated principal maturity date), shall
be in the form prescribed in the FORM OF SUBST r= BOND set forth in this Ordinance, and
shall have the characteristics, and may be assigned, transferred, and converted as hereinafter provided.
If the Initial Bond or any portion thereof is assigned and transferred or converted the Initial Bond
must be surrendered to the Paying Agent/Registrar for cancellation, and each Bond issued in
exchange for any portion of the Initial Bond shall have a single stated principal maturity date, and
shall not be payable in installments; and each such Bond shall have a principal maturity date
corresponding to the due date of the installment of principal or portion thereof for which the
substitute Bond is being exchanged; and each such Bond shall bear interest at the single rate
applicable to and borne by such installment of principal or portion thereof for which it is being ex-
changed If only a portion of the Initial Bond is assigned and transferred, there shall be delivered
to and registered in the name of the initial registered owner substitute Bonds in exchange for the
unassigned balance of the Initial Bond in the same manner as if the initial registered owner were the
assignee thereof. If any Bond or portion thereof other than the Initial Bond is assigned and
transferred or converted each Bond issued in exchange therefor shall have the same principal maturity
date and bear interest at the same rate as the Bond for which it is exchanged. A form of assignment
shall be printed or endorsed on each Bond, excepting the Initial Bond, which shall be executed by
the registered 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 authorized representative of the Paying Agent/Registrar shall make such transfer in the
Registration Books, and shall deliver a new fully registered substitute Bond or Bonds, having 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 of a Bond is being assigned and transferred, all in conversion of and exchange for said
assigned Bond or Bonds or any portion or portions thereof, in the same form and manner, and with
the same effect, as provided in Section 6(d), below, for the conversion and exchange of Bonds by any
registered owner of a Bond. The Issuer shall pay the Paying Agent/Registrar's standard or customary
fees and charges for making such transfer and delivery of a 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 required to make transfers of registration
of any Bond or any portion thereof (i) during the period commencing with the close of business on
any Record Date and ending with the opening of business on the next following principal or interest
payment date, or, (ii) with respect to any Bond or any portion thereof called for redemption prior
to maturity, within 45 days prior to its redemption date.
(b) Ownership of Bonds. The entity in whose name any Bond shall be registered in 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 the sum or sums so paid.
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(c) Payment of Bonds and Interest. The Issuer hereby further appoints the Paying
Agent/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
Agent/Registrar with respect to the Bonds, and of all conversions and exchanges of Bonds, and all
replacements of Bonds, as provided in this Ordinance.
(d) Conversion and Exchange or Replacement. Authentication. Each Bond issued and
delivered pursuant to this Ordinance, to the extent of the unpaid or unredeemed principal balance
or principal amount thereof, may, upon surrender of such Bond at the principal corporate trust office
of the Paying Agent/Registrar, together with a written request therefor duly executed by the
registered owner or the assignee or assignees thereof, or its or their duly authorized attorneys or
representatives, with 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 into and
exchanged for fully registered bonds, without interest coupons, in the form prescribed in the FORM
OF SUBSTITUTE BOND set forth in this Ordinance, in the denomination of $5,000, or any integral
multiple of $5,000 (subject to the requirement hereinafter stated that each substitute Bond shall have
a single stated maturity date), as requested in writing by such registered owner or such assignee or
assignees, in an aggregate principal amount equal to the unpaid or unredeemed principal balance or
principal amount of any Bond or Bonds so surrendered, and payable to the appropriate registered
owner, assignee, or assignees, as the case may be. If the Initial Bond is assigned and transferred or
converted each substitute Bond issued in exchange for any portion of the Initial Bond shall have a
single stated principal maturity date, and shall not be payable in installments; and each such Bond
shall have a principal maturity date corresponding to the due date of the installment of principal or
portion thereof for which the substitute Bond is being exchanged; and each such Bond shall bear
interest at the single rate applicable to and borne by such installment of principal or portion thereof
for which it is being exchanged If a portion of any Bond (other than the Initial Bond) shall be
redeemed prior to its scheduled maturity as provided herein, a substitute Bond or Bonds having the
same maturity date, bearing interest at the same rate, in the denomination or denominations of any
integral multiple of $5,000 at the request of the registered owner, and in aggregate principal amount
equal to the unredeemed portion thereof, will be issued to the registered owner upon surrender
thereof for cancellation. If any Bond or portion thereof (other than the Initial Bond) is assigned and
transferred or converted, each Bond issued in exchange therefor shall have the same principal
maturity date and bear interest at the same rate as the Bond for which it is being exchanged Each
substitute Bond shall bear a letter and/or number to distinguish it from each other Bond The Paying
Agent/Registrar shall convert and exchange or replace Bonds as provided herein, and each fully
registered bond delivered in conversion of and exchange for or replacement of any Bond or portion
thereof as permitted or required by any provision of this Ordinance shall constitute one of the Bonds
for all purposes of this Ordinance, and may again be converted and exchanged or replaced. It is
specifically provided that any Bond authenticated in conversion of and exchange for or replacement
of another Bond on or prior to the first scheduled Record Date for the Initial Bond shall bear
interest from the date of the Initial Bond, but each substitute Bond so authenticated after such first
scheduled Record Date shall bear interest from the interest payment date next preceding the date
on which such substitute Bond was so authenticated, unless such Bond is authenticated after any
Record Date but on or before the next following interest payment date, in which case it shall bear
interest from such next following interest payment date; provided, however, that if at the time of
delivery of any substitute Bond the interest on the Bond for which it is being exchanged is due but
has not been paid, then such Bond shall bear interest from the date to which such interest has been
paid in full. THE INITIAL BOND issued and delivered pursuant to this Ordinance is not required
to be, and shall not be, authenticated by the Paying Agent/Registrar, but on each substitute Bond
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issued in conversion of and exchange for or replacement of any Bond or Bonds issued under this
Ordinance there shall be printed a bond, in the form substantially as follows:
"PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been issued under the provisions of the Bond
Ordinance described in this Bond; and that this Bond has been issued in conversion of and exchange
for or replacement of a bond, bonds, or a portion of a 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.
NATIONSBANK OF TEXAS, N.A.,
DALLAS, TEXAS
Paying Agent/Registrar
Dated
Authorized Representative"
By
An authorized representative of the Paying Agent/Registrar shall, before the delivery of any such
Bond, date and manually sign the above Bond, and no such Bond shall be deemed to be issued or
outstanding 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 governing 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 Agent/Registrar shall provide for the printing, execution, and delivery
of the substitute Bonds in the manner prescribed herein, and said Bonds shall be of type composition
printed on paper with lithographed or steel engraved borders of customary weight and strength.
Pursuant to Vernon's Ann. Tex Civ. 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/Registrar's Authentication
Certificate, the converted and exchanged or replaced Bond shall be valid, incontestable, and
enforceable in the same manner and with the same effect as the Initial Bond which originally was
issued pursuant to this 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 transferring, 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 paid with respect thereto as a condition precedent to the
exercise of such privilege of conversion and exchange. The Paying Agent/ Registrar shall not be
required to make any such conversion and exchange or replacement of Bonds or any portion thereof
(i) during the period commencing with the close of business on any Record Date and ending with
the opening of business on the next following principal or interest payment date, or, (ii) with respect
to any Bond or portion thereof called for redemption prior to maturity, within 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, (i) shall be issued in fully registered form, without interest coupons, with
the principal 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
10
be converted and exchanged for other Bonds, (v) shall have the characteristics, (vi) shall be signed
and sealed, and (vii) the principal 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.
(f) Payment of Fees and Charges. The Issuer hereby covenants with the registered owners
of the Bonds that it will (i) pay the standard or customary fees and charges of the Paying
Agent/Registrar for its services with respect to the payment of the principal of and interest on the
Bonds, when due, and (ii) pay the fees and charges of the Paying Agent/Registrar for services with
respect to the transfer of registration of Bonds, and with respect to the conversion and exchange of
Bonds solely to the extent above provided in this Ordinance.
(g) Substitute Paying Agent/Registrar. The Issuer covenants with the registered owners of
the Bonds that at all times while the Bonds are outstanding the Issuer will provide a competent and
legally qualified bank, trust company, financial institution, or other agency to act as and perform the
services of Paying Agent/Registrar for the Bonds under this Ordinance, and that the Paying
Agent/Registrar will be one entity. The Issuer reserves the right to, and may, at its option, change
the Paying Agent/Registrar upon not less than 120 days written notice to the Paying Agent/Registrar,
to be effective not later than 60 days prior to the next principal or interest payment date after such
notice. In the event that the entity at any time acting as Paying Agent/Registrar (or its successor by
merger, acquisition, or other method) should resign or otherwise cease to act as such, the Issuer
covenants that promptly it will appoint a competent and legally qualified bank, trust company,
financial institution, or other agency to act as Paying Agent/Registrar under this Ordinance. Upon
any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar promptly shall transfer
and deliver the Registration Books (or a copy thereof), along with 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 in the Paying 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 United States mail, first-class postage prepaid, which notice also shall give the address of the new
Paying Agent/Registrar. By accepting the position and performing as such, each Paying
Agent/Registrar shall be deemed to have agreed to the provisions of this Ordinance, and a certified
copy of this Ordinance shall be delivered to each Paying Agent/Registrar.
Section 7. FORM OF SUBSTITUTE BONDS. The form of all Bonds issued in conversion
and exchange or replacement of any other Bond or portion thereof, including the form of Paying
Agent/Registrar's Bond to be printed on each of such Bonds, and the Form of Assignment to be
printed on each of the Bonds, shall be, respectively, substantially as follows, with such appropriate
variations, omissions, or insertions as are permitted or required by this Ordinance.
11
FORM OF SUBSTITUTE BOND
NO. UNITED STATES OF AMERICA PRINCIPAL AMOUNT
STATE OF TEXAS $
COUNTY OF DENTON
CITY OF DENTON GENERAL OBLIGATION REFUNDING BOND
SERIES 1993-A
INTEREST RATE
ORIGINAL DATE
MATURITY DATE OF ISSUE
CUSIP NO.
JUNE 1, 1993
ON THE MATURITY DATE specified above the CITY OF DENTON, in Denton County,
Texas (the "Issuer"), being a political subdivision of the State of Texas, hereby promises to pay to
, or to the registered assignee hereof (either being
hereinafter called the "registered owner") the principal amount of
and to pay interest thereon, calculated on the basis of a 360-day year composed of twelve 30-day
months, from JUNE 1, 1993, 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 payable on
FEBRUARY 15, 1994, and semiannually on each FEBRUARY 15 and AUGUST 15 thereafter,
except that if the date of authentication of this Bond is later than the rust 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 principal
amount shall bear interest from such next following interest payment date.
THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the
United States of America, without exchange or collection charges. The principal of this 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 principal corporate trust office of
NATIONSBANK OF TEXAS, N.A., 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 the Paying Agent/Registrar by United States mail, 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 15th 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 any other method acceptable to the Paying
Agent/Registrar and requested by, and at the risk and expense of, the registered owner hereof. Any
accrued interest due upon the redemption of this Bond prior to maturity as provided herein shall be
paid to the registered owner at the principal corporate trust office of the Paying Agent/Registrar
upon presentation and surrender of this Bond for redemption and payment at the principal corporate
trust office of the Paying Agent/Registrar. The Issuer covenants with the registered owner of this
12
Bond that on or before each principal payment date, interest payment date, and accrued interest
payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Interest
and Sinking Fund" created by the Bond Ordinance, the amounts required to provide for the payment,
in immediately available funds, of all principal of and interest on the Bonds, when due.
IF THE DATE for the payment of the principal of or interest on this Bond shall be a
Saturday, Sunday; a legal holiday, or a day on which banking institutions in the City where the Paying
Agent/Registrar is located are authorized by law or executive order to close, then the date for such
payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day
on which banking institutions are authorized to close; and payment on such date shall have the same
force and effect as if made on the original date payment was due.
THIS BOND is one of an issue of Bonds initially dated JUNE 1, 1993, authorized in
accordance with the Constitution and laws of the State of Texas in the principal amount of
$13,315,000, FOR THE PURPOSE OF OBTAINING FUNDS REQUIRED TO REFUND
$11,795,000 IN AGGREGATE PRINCIPAL AMOUNT OF TAX SUPPORTED OBLIGATIONS
OF THE CITY OF DENTON, TEXAS.
ON FEBRUARY 15, 2002, or on any date whatsoever thereafter, the Bonds of this Series
may be redeemed prior to their scheduled maturities, at the option of the Issuer, with funds derived
from any available and lawful source, as a whole, or in part, and, if in part, the particular Bonds, or
portions thereof; to be redeemed shall be selected and designated by the Paying Agent/Registrar
(provided that a portion of a Bond may be redeemed only in an integral multiple of $5,000), at the
redemption price of the par or principal 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 maturity a written notice of such redemption shall be published once in a financial publica-
tion, journal, or reporter of general circulation among securities dealers in The City of New York,
New York (including, but not limited 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 Paying Agent/Registrar by United States mail, first-class postage prepaid, not less than
30 days prior to the date fixed for any such redemption, 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 failure to send, mail, or receive such notice, or any defect therein or in the sending
or mailing thereof, shall not affect the validity or effectiveness of the proceedings for the redemption
of any Bond, and it is hereby specifically provided that the publication of such notice as required
above shall be the only notice actually required in connection with or as a prerequisite to the
redemption of any Bonds or portions thereof. By the date fixed for any such redemption due provi-
sion shall be made with the Paying Agent/Registrar for the payment of the required redemption price
for the Bonds or 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 provided above, the Bonds or portions thereof which are to be so re-
deemed 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. If a
portion of any Bond shall be redeemed a substitute Bond or Bonds having the same maturity date,
bearing interest at the same rate, in any denomination or denominations in any integral multiple of
$5,000, at the written request of the registered owner, and in aggregate principal amount equal to
13
the unredeemed portion thereof, will 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, this Bond must be presented and surrendered to the Paying Agent/Registrar,
together with proper instruments of assignment, in form and with guarantee of signatures satisfactory
to the Paying Agent/Registrar, evidencing assignment of this Bond or any portion or portions hereof
in any integral multiple of $5,000 to the assignee or assignees in whose name or names this Bond or
any such portion or portions hereof is or are to be transferred and registered. The form of
Assignment printed or endorsed on this 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 (which then will be the new registered owner or owners of such
new Bond or Bonds), or to the previous registered owner in the case of the assignment and transfer
of only a portion of this Bond, may be delivered by the Paying Agent/Registrar in conversion of and
exchange for this Bond, all in the form and manner as provided in the next paragraph hereof for the
conversion and exchange of other Bonds. The Issuer shall pay the Paying Agent/Registrar's standard
or customary fees and charges for making such transfer, 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 required to make transfers of registration of this Bond or any portion
hereof (i) during the period commencing with the close of business on any Record Date and ending
with the opening of business on the next following principal or interest payment date, or, (ii) with
respect to any Bond or any portion thereof called for redemption prior to maturity, within 45 days
prior to its redemption date. 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 discharge of liability 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 SERIFS are issuable solely as fully registered bonds, without interest
coupons, in the denomination of any integral multiple of $5,000. As provided in the Bond
Ordinance, this 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 principal
amount of fully registered bonds, without interest coupons, payable to the appropriate registered
owner, assignee, or assignees, as the case may be, having the same maturity date, and bearing interest
at the same rate, in any denomination or denominations in any integral multiple of $5,000 as
requested in writing by the appropriate registered owner, assignee, or assignees, as the case may be,
upon surrender of this Bond to the Paying Agent/Registrar for cancellation, all in accordance with
the form and procedures set forth in the Bond Ordinance. The Issuer shall pay the Paying
Agent/Registrar's standard or customary fees and charges for transferring, 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 prece-
dent to the exercise of such privilege of conversion and exchange. The Paying Agent/Registrar shall
not be required to make any such conversion and exchange (i) during the period commencing with
the close of business on any Record Date and ending with the opening of business on the next
following principal or interest payment date, or, (ii) with respect to any Bond or portion thereof
called for redemption prior to maturity, within 45 days prior to its redemption date.
14
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 promptly will cause written
notice thereof to be mailed 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 things required or proper
to be performed, exist, and be done precedent to or in the authorization, issuance, and delivery of
this Bond have been performed, existed, and been done in accordance with law; that this Bond is a
general obligation of the Issuer, issued on the full faith and credit thereof; and that annual ad
valorem taxes sufficient to provide for the payment of the interest on and principal of this Bond, as
such interest comes due and such principal matures, have been levied and ordered to be levied
against all taxable property in the Issuer, and have been pledged irrevocably for such payment, within
the limit prescribed by law.
BY BECOMING the registered owner of this Bond, the registered owner thereby
acknowledges all of the terms and provisions 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 in the official minutes and records of the governing body of the Issuer, and agrees that the
terms and provisions of this 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 facsimile
signature of the Mayor of the Issuer and countersigned with the facsimile signature of the City
Secretary of the Issuer, and has caused the official seal of the Issuer to be duly impressed, or placed
in facsimile, on on this Bond.
(facsimile signature)
City Secretary,
City of Denton, Texas
(facsimile signature)
Mayor,
City of Denton, Texas
(CITY SEAL)
FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been issued under the provisions of the Bond
Ordinance described in this Bond; and that this Bond has been issued in conversion of and exchange
for or replacement of a bond, bonds, or a portion of a 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.
NATIONSBANK OF TEXAS, N.A.,
DALLAS, TEXAS
Paying Agent/Registrar
Dated
By
Authorized Representative
15
FORM OF ASSIGNMENT:
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned registered owner of this Bond, or duly
authorized representative or attorney thereof, hereby assigns this Bond to
(Assignee's Social (print or typewrite Assignee's name and
Security or Taxpayer address, including zip code)
Identification Number)
and hereby irrevocably constitutes and appoints
attorney to transfer the registration of this Bond on the Paying Agent/Registrar's Registration Books
with full power of substitution in the premises.
Dated:
Signature Guaranteed:
NOTICE: This signature must be
guaranteed by a member of the
New York Stock Exchange or a
commercial bank or trust
company.
Registered Owner
NOTICE: This signature must
correspond with the name of
the Registered Owner appear-
ing on the face of this Bond.
Section & (a) TAX LEVY. A special Interest and Sinking Fund (the "Interest and Sinking
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 Sinking 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 principal 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 while any of the Bonds or interest thereon are
outstanding and unpaid, the governing body of the Issuer shall compute and ascertain a rate and
amount of ad valorem tax which 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 sinking fund
adequate to pay the principal of its Bonds as such principal matures (but never less than 2% of the
original principal amount of the Bonds as a sinking fund each year); and said tax shall be based on
the latest approved tax rolls of the Issuer, with full allowance being made for tax delinquencies and
the cost of tax collection. Said rate and amount of ad valorem tax is hereby levied, and is hereby
ordered to be levied, against all taxable property in the Issuer for each year while any of the Bonds
or interest thereon are outstanding and unpaid; and said tax shall be assessed and collected each such
year and deposited to the credit of the aforesaid Interest and Sinking Fund. Said ad valorem taxes
sufficient to provide for the payment of the interest on and principal of the Bonds, as such interest
16
comes due and such principal matures, are hereby pledged for such payment, within the limit
prescribed by law.
(b) APPROPRIATION. There is hereby appropriated from surplus funds of the Issuer now
on hand and lawfully available for such purpose, and shall be deposited into the Interest and Sinking
Fund for the Bonds, the amount of money required to pay the interest coming due on the Bonds on
February 15, 1994. The money thus appropriated and deposited shall be used for no purpose other
than to pay said interest on the Bonds. The appropriate officials of the Issuer are hereby authorized
and directed do any and all things necessary or convenient to accomplish said appropriation and
deposit.
Section 10. DEFEASANCE OF BONDS. (a) Any Bond and the interest thereon shall be
deemed to be paid, retired, and no longer outstanding (a "Defeased Bond") within the meaning of
this Ordinance, except to the extent provided in subsection (d) of this Section, when payment of the
principal of such Bond, plus interest thereon to the due date (whether such due date be by reason
of maturity, upon redemption, or otherwise) either (i) shall have been made or caused to be made
in accordance with the terms 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 making
available to the Paying Agent/Registrar for such payment (1) lawful money of the United States of
America sufficient to make such payment or (2) Government Obligations which mature as to principal
and interest in such amounts and at such times as will insure the availability, without reinvestment,
of sufficient money to provide for such payment, and when proper arrangements have been made by
the Issuer with 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 Ordinance, and such principal and interest shall be payable solely from such money or
Government Obligations.
(b) Any moneys so deposited with the Paying Agent/Registrar may at the written direction
of the Issuer also be invested in Government Obligations, maturing in the amounts and times as
hereinbefore set forth, and all income from such Government Obligations received by the Paying
Agent/Registrar which is not required 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 in writing by the Issuer.
(c) The term "Government Obligations" as used in this Section shall mean direct
obligations of the United States of America, including obligations the principal of and interest on
which are unconditionally guaranteed by the United States of America, which may be United States
Treasury obligations such as its State and Local Government Series, which may be in book-entry
form.
(d) Until all Defeased Bonds shall have become due and payable, the Paying
Agent/Registrar shall perform the services of Paying Agent/Registrar for such Defeased Bonds the
same as if they had not been defeased, and the Issuer shall make proper arrangements to provide and
pay for such services as required by this 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 Agent/Registrar shall cause to be printed, executed, and delivered, a new bond
17
of the same principal amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or
destroyed Bond, in replacement for such Bond in the manner hereinafter 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 Paying
Agent/Registrar. -In every case of loss, theft, or destruction of a Bond, the registered owner applying
for a replacement bond shall furnish to the Issuer and to the Paying Agent/Registrar such security
or indemnity as may be required by them to save each of them harmless from any loss or damage with
respect thereto. Also, in every case of loss, theft, or destruction of a Bond, the registered owner shall
furnish to the Issuer and the Paying Agent/Registrar evidence to their satisfaction of the loss, theft,
or destruction of such Bond, as the case may be. In every case of damage or mutilation of a 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 of this Section, in
the event of any such Bond shall have matured, and no default has occurred which is then continuing
in the payment of the principal of, redemption premium, if any, or interest on the Bond, the Issuer
may authorize the payment of the same (without surrender thereof except in the case of a damaged
or mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished
as above provided in this Section.
(d) Charge for Issuing Replacement Bonds. Prior to the issuance of any replacement bond,
the Paying Agent/Registrar shall charge the registered owner of such Bond with all legal, printing,
and other expenses in connection therewith. Every replacement bond issued pursuant to the
provisions of this Section by virtue of the fact that any Bond is lost, stolen, or destroyed shall
constitute a contractual obligation of the Issuer whether or not the lost, stolen, or destroyed Bond
shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of
this Ordinance equally and proportionately with any and all other Bonds duly issued under this
Ordinance.
(e) Authority for Issuing Replacement Bonds. In accordance with Section 6 of Vernon's
Ann. Tex. Civ. St. Art. 717k-6, this Section of this Ordinance shall constitute authority for the
issuance of any such replacement bond without necessity of further action by the governing body of
the Issuer or any other body or person, and the duty of the replacement of such bonds is hereby
authorized and imposed upon the Paying Agent/Registrar, and the Paying Agent/Registrar shall
authenticate and deliver such Bonds in the form and manner and with the effect, as provided in
Section 6(d) of this Ordinance for Bonds issued in conversion and exchange for other Bonds.
Section 12. COVENANTS REGARDING TAX-EXEMPTION. The Issuer covenants to
refrain from taking any action which would adversely affect, and to take any action required to
ensure, the treatment of the Bonds as obligations described in section 103 of the Code, the interest
on which is not includable in the "gross income" of the holder for purposes of federal income
taxation. In furtherance thereof, the Issuer covenants as follows:
(a) to take any action to assure that no more than 10 percent of the proceeds of
the Bonds (less amounts deposited to a reserve fund, if any) are used for any "private business
use", as defined in section 141(b)(6) of the Code or, if more than 10 percent of the proceeds
are so used, that amounts, whether or not received by the Issuer, with respect to such private
business use, do not, under the terms of this Ordinance or any underlying arrangement,
18
directly or indirectly, secure or provide for the payment of more than 10 percent of the debt
service on the Bonds, in contravention of section 141(b)(2) of the Code;
(b) to take any action to assure that in the event that the "private business use"
described in subsection (a) hereof exceeds 5 percent of the proceeds of the Bonds (less
amounts deposited into a reserve fund, if any) then the amount in excess of 5 percent is used
for a "private business use" which is "related" and not "disproportionate", within the meaning
of section 141(b)(3) of the Code, to the governmental use;
(c) to take any action to assure that no amount which is greater than the lesser
of $5,000,000, or 5 percent of the proceeds of the Bonds (less amounts deposited into a
reserve fund, if any) is directly or indirectly used to finance loans to persons, other than state
or local governmental units, in contravention of section 141(c) of the Code;
(d) to refrain from taking any action which would otherwise result in the Bonds
being treated as "private activity bonds" within the meaning of section 141(b) of the Code;
(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, directly or
indirectly, to acquire or to replace funds which were used, directly or indirectly, to acquire
investment property (as defined in section 148(b)(2) of the Code) which produces a materially
higher yield over the term of the Bonds, other than investment property acquired with
(1) proceeds of the Bonds invested for a reasonable temporary period of
3 years 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, within the meaning
of section 1.103-13(b)(12) of the Treasury Regulations, and
(3) amounts deposited in any reasonably required reserve or replacement
fund to the extent such amounts do not exceed 10 percent of the proceeds 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 otherwise
contravene the requirements of section 148 of the Code (relating to arbitrage) and, to the
extent applicable, section 149(d) of the Code (relating to advance refundings);
(h) to pay to the United States of America at least once during each five-year
period (beginning on the date of delivery of the Bonds) an amount that is at least equal to
90 percent of the "Excess Earnings", within the meaning of section 148(f) of the Code and
to pay to the United States of America, not later that 60 days after the Bonds have been paid
in full, 100 percent of the amount then required to be paid as a result of Excess Earnings
under section 148(f) of the Code; and
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(i) to maintain such records as will enable the Issuer to fulfill its responsibilities
under this section and section 148 of the Code and to retain such records for at least six years
following the final payment of principal and interest on the Bonds.
It is the understanding of the Issuer that the covenants contained herein are intended to assure
compliance with the Code and any regulations or rulings 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 provisions of the Code, as applicable to the Bonds, the Issuer will not be required
to comply with any covenant contained herein to the extent that such modification or expansion, in
the opinion of nationally-recognized bond counsel, will not adversely affect the exemption from
federal income taxation of interest on the Bonds under section 103 of the Cade. In the event that
regulations or rulings are hereafter promulgated which impose additional requirements which are
applicable to the Bonds, the Issuer agrees to comply with the additional requirements to the extent
necessary, in the opinion of nationally-recognized bond counsel, to preserve the exemption from
federal income taxation of interest on the Bonds under section 103 of the Code.
Section 13. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND
COUNSEL'S OPINION, CUSIP NUMBERS, PREAMBLE AND INSURANCE. The Mayor of the
Issuer is hereby authorized to have control of the Initial Bond issued hereunder and all necessary
records and proceedings pertaining to the Initial Bond pending its delivery and its investigation,
examination, and approval by the Attorney General of the State of Texas, and its registration by the
Comptroller of Public Accounts of the State of Texas. Upon registration of the Initial Bond said
Comptroller of Public Accounts (or a deputy designated in writing to act for said Comptroller) shall
manually sign the Comptroller's Registration Certificate on the Initial Bond, and the seal of said
Comptroller shall be impressed, or placed in facsimile, on the Initial Bond. The approving legal
opinion of the Issuer's Bond Counsel and the assigned CUSIP numbers may, at the option of the
Issuer, be printed on the Initial Bond or on any Bonds issued and delivered 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 information 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 is obtained on
any of the Bonds, the Initial Bond and all other Bonds shall bear an appropriate legend concerning
insurance as provided by the insurer.
Section 14. DTC REGISTRATION. The Bonds initially shall be issued and delivered in such
manner that no physical distribution of the Bonds will be made to the public, and the Depository
Trust Company ("DTC"), New York, New York, initially will act as depository for the Bonds. DTC
has represented that it is a limited purpose trust company incorporated under the laws of the State
of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning
of the New York Uniform Commercial Code, and a "clearing agency" registered under Section 17A
of the federal Securities Exchange Act of 1934, as amended, and the Issuer accepts, but in no way
verifies, such representations. The Initial Bond authorized by this Ordinance shall be delivered to
and registered in the name of the Merrill Lynch & Co., as representative of the Underwriters (the
"Purchaser"). However, it is a condition of delivery and sale that the Purchaser, immediately after
such delivery, shall cause the Paying Agent/Registrar, as provided for in this Ordinance, to cancel said
Initial Bond and deliver in exchange therefor a substitute Bond for each maturity of such Initial Bond,
with each such substitute Bond to be registered in the name of CEDE & CO., the nominee of DTC,
and it shall be the duty of the Paying Agent/Registrar to take such action. It is expected that DTC
will hold the Bonds on behalf of the Purchaser and/or the Direct Participants, as defined and
described in the Official Statement referred to and approved in Section 14 hereof (the "DTC
Participants"). So long as each Bond is registered in the name of CEDE & CO., the Paying
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Agent/Registrar shall treat and deal with DTC in all respects the same as if it were the actual and
beneficial owner thereof. It is expected that DTC will maintain a book entry system which will
identify beneficial ownership of the Bonds by DTC Participants in integral amounts of $5,000, with
transfers of ownership being effected on the records of DTC and the DTC Participants pursuant to
rules and regulations established by them, and that the substitute Bonds initially deposited with DTC
shall be immobilized and not be further exchanged for substitute Bonds except as hereinafter
provided. The Issuer is not responsible or liable for any functions of DTC, will not be responsible
for paying any fees or charges with respect to its services, will not be responsible or liable for
maintaining, supervising, or reviewing the records of DTC or the DTC Participants, or protecting any
interests 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 with DTC to establish this book-entry system, the
beneficial ownership 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 initial book-entry system
established with DTC will be maintained in the future. The Issuer reserves the right and option at
any time in the future, in its sole discretion, to terminate the DTC (CEDE & CO.) book-entry only
registration requirement described above, and to permit the Bonds to be registered in the name of
any owner. If the Issuer exercises its right and option to terminate such requirement, it shall give
written notice of such termination to the Paying Agent/Registrar and to DTC, and thereafter the
Paying Agent/Registrar shall, upon presentation and proper request, register any Bond in any name
as provided for in this Ordinance. Notwithstanding the initial establishment of the foregoing book-
entry system with DTC, if for any reason any of the originally delivered substitute Bonds is duly filed
with the Paying Agent/Registrar with proper request for transfer and substitution, as provided for in
this Ordinance, substitute Bonds will be duly delivered as provided in this Ordinance, and there will
be no assurance or representation that any book-entry system will be maintained for such Bonds.
Section 15. SALE OF INITIAL BONDS. The Initial Bond is hereby sold and shall be
delivered to MERRILL LYNCH & CO., as representative of the underwriters, in accordance with
the Bond Purchase Agreement dated the date of this meeting and presented to the City Council of
the City at this meeting. The Mayor of the Issuer is authorized and directed to execute, on behalf
of the Issuer, said Bond Purchase Agreement in the form and substance submitted at this meeting.
Section 16. OFFICIAL STATEMENT. An Official Statement dated as of the date of this
meeting has been prepared in connection with the sale of the Initial Bond and the Bonds, in the form
and substance submitted at this meeting. Said Official Statement and any supplement or addenda
thereto have been and are hereby approved, and their use in the offer and sale of the Bonds is
hereby approved. It is further officially found, determined, and declared that the statements and
representations contained in said Official Statement are true and correct in all material respects, to
the best knowledge and belief of the Issuer. The distribution and use of the Preliminary Official
Statement dated May 25, 1993, prior to the date hereof is hereby ratified and approved.
Section 17. REFUNDING OF OUTSTANDING BONDS. That concurrently with the
delivery of the Initial Bond the Issuer shall deposit an amount from the proceeds from the sale of
the Initial Bond, with NationsBank of Texas, N.A., as Escrow Agent, sufficient, together with other
available amounts, to refund all of the Outstanding Bonds in accordance with Section 7A of Vernon's
Ann. Tex. Civ. St. Article 717k, as amended. The Issuer hereby authorizes the execution of the
Escrow Agreement dated as of June 1, 1993 between the Escrow Agent and the Issuer. The Mayor
of the Issuer is authorized and directed to execute, on behalf of the Issuer, said Escrow Agreement
in the form and substance presented to this meeting. It is hereby found and determined that the
refunding of the Outstanding Bonds is advisable and necessary in order to restructure the debt service
requirements and procedures of the Issuer, and that the debt service requirements on the Bonds will
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be less than those on the Outstanding Bonds, resulting in a reduction in the amount of principal and
interest which otherwise would be payable both on an actual and a present value basis.
Section 18. REDEMPTION OF OUTSTANDING BONDS. There is attached hereto and
made a part hereof for all purposes a list and description of certain City of Denton General
Obligation Bonds and City of Denton Certificates of Obligation, and notice provisions relating
thereto, which bonds are hereby called for redemption, and shall be redeemed, prior to their
scheduled maturities, on the date, at the place, and at the price, set forth therein; the Issuer shall
cause the appropriate notices of such redemption to be given in accordance with the requirements
of the respective proceedings authorizing the issuance of such bonds; and due provision shall be made
by the Issuer in accordance with law for the payment of the redemption price of said bonds by the
place of payment (paying agent) for such bonds.
Section 19. 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 herein
mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this
Bond Ordinance, the Bonds, the sale of the Bonds, the Bond Purchase Agreement, the Escrow
Agreement and the Official Statement; and the Director of Finance of the City shall cause the
expenses of issuance of the Bonds to be paid from the proceeds of sale of the Initial Bond. In case
any officer whose signature shall appear on any Bond shall cease to be such officer before the
delivery of such Bond, such signature shall nevertheless be valid and sufficient for all purposes the
same as if such officer had remained in office until such delivery.
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CERTIFICATE FOR
ORDINANCE AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF
CITY OF DENTON GENERAL OBLIGATION REFUNDING BONDS, SERIES
1993-A, AND APPROVING AND AUTHORIZING INSTRUMENTS AND
PROCEDURES RELATING THERETO
THE STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON
We, the undersigned officers of said City, hereby certify as follows:
1. The City Council of said City convened in SPECIAL MEETING ON THE 8TH DAY OF
JUNE, 1993, at the Municipal Building (City Hall), and the roll was called of the duly constituted
officers and members of said City Council, to-wit:
Jennifer K Walters, Bob Castleberry, Mayor
City Secretary Margaret Smith, Mayor Pro Tem
Harold Perry Euline Brock
Jerry Cott Jack Miller
Mark Chew
and all of said persons were present, except the following absentees: ,
thus constituting a quorum. Whereupon, among other business, the following was transacted at said
Meeting: a written
ORDINANCE AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF
CITY OF DENTON GENERAL OBLIGATION REFUNDING BONDS, SERIES
1993-A, AND APPROVING AND AUTHORIZING INSTRUMENTS AND
PROCEDURES RELATING THERETO
was duly introduced for the consideration of said City Council and duly read. It was then duly moved
and 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: /
NOES:
ABSTENTIONS:
2. That a true, full, and correct copy of the aforesaid Ordinance passed at the Meeting
described in the above and foregoing paragraph is attached to and follows this Certificate; that said
Ordinance has been duly recorded in said City Council's minutes of said Meeting; that the above and
foregoing paragraph is a true, full, and correct excerpt from said City Council's minutes of said
Meeting pertaining 6 the passage of said Ordinance; that the persons named in the above and 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
sufficiently 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 City 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 said City hereby declare that their signing of this Certificate shall
constitute the signing of the attached and following copy of said Ordinance for all purposes.
4iSIGN
ED AND SEALED the 8th day of June, 1993.
Secretary
(SEAL)
We, the undersigned, being respectively the City Attorney and the Bond Attorneys of the City
of Denton, Texas, hereby certify that we prepared and appr7ed as to legality the attached and
following Ordinance prior to its passage as aforesaid.-
J City torney
VV~
Bond Attorneys