1992-039 ORDIN CE NO
ORDINANCE
AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF CITY OF DENTON
CERTIFICATES OF OBLIGATION, SERIES 1992, AND APPROVING AND
AUTHORIZING INSTRUMENTS AND PROCEDURES RELATING THERETO
THE STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON
WHEREAS, the Certificate of Obligation Act of 1971, as
amended and codified (the "Act") permits the City to issue and
sell for cash the Certificates of Obligation hereinafter
authorized, and
WHEREAS, the City has duly caused notice of its intention
to issue the Certificates of Obligation hereinafter authorized
to be published at the times and in the manner required by the
Act and no petition has been filed protesting the issuance
thereof
THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY
ORDAINS THAT
Section i AMOUNT AND PURPOSE OF THE CERTIFICATES The
certificate or certificates of the city of Denton, Texas (the
"Issuer") are hereby authorized to be issued and delivered in
the aggregate principal amount of $1,325,000, FOR THE PURPOSE
OF PAYING ALL OR A PORTION OF THE CITY'S CONTRACTUAL OBLIGA-
TIONS INCURRED (1) PURSUANT TO CONTRACTS FOR THE CONSTRUCTION
OF PUBLIC WORKS, TO-WIT (a) REPLACING AIR CONDITIONING
SYSTEMS IN CITY BUILDINGS, (b) REPLACING ROOFS ON CITY BUILD-
INGS, (c) CONSTRUCTING AND REPAIRING PARKING LOTS FOR CITY
BUILDINGS, (d) INSTALLING ELECTRICAL EQUIPMENT IN CITY BUILD-
INGS, (e) RENOVATING CITY BUILDINGS, (f) CONSTRUCTING NEW
SIDEWALKS AT CITY BUILDINGS, (g) RENOVATING THE CITY SWIMMING
POOL, (h) INSTALLING SECURITY SYSTEMS IN CITY BUILDINGS, AND
(1) INSTALLING SOUND SYSTEMS IN CITY BUILDINGS, AND (2) PURSU-
ANT TO CONTRACTS FOR THE PURCHASE OF THE FOLLOWING EQUIPMENT
FOR ,CITY USE TWO REFUSE TRUCKS, A DUMP TRUCK, A STREET POTHOLE
PATCHER, A TRAFFIC SIGNAL BUCKET TRUCK, A FIRE DEPARTMENT
AMBULANCE, FIRE DEPARTMENT EMERGENCY MEDICAL EQUIPMENT, A
SUBURBAN AUTOMOBILE, AND TWELVE POLICE CARS, AND ALSO FOR THE
PURPOSE OF PAYING ALL OR A PORTION OF THE CITY'S CONTRACTUAL
OBLIGATIONS FOR PROFESSIONAL SERVICES OF ENGINEERING, ATTOR-
NEYS, AND FINANCIAL ADVISORS IN CONNECTION WITH THE ABOVE
CONTRACTS AND SAID CERTIFICATES OF OBLIGATION
Section 2 DESIGNATION OF THE CERTIFICATES Each cert-
lfioate issued pursuant to this Ordinance shall be designated
"CITY OF DENTON CERTIFICATE OF OBLIGATION, SERIES 1992", and
Initially there shall be issued, sold, and delivered hereunder
a single fully registered certificate, without interest cou-
pons, payable in installments of principal (the "Initial
Certificate"), but the Initial Certificate may be assigned and
transferred and/or converted into and exchanged for a like
aggregate principal amount of fully registered certlf~cates,
without interest coupons, having serial maturities, and in the
denomination or denominations of $5,000 or any integral multi-
ple of $5,000, all in the manner hereinafter provided The
term "Certificates" as used in this Ordinance shall mean and
include collectively the Initial Certificate and all substitute
certificates exchanged therefor, as well as all other substi-
tute certificates and replacement certificates issued pursuant
hereto, and the term ,,Certificates" shall mean any of the
Certificates
Section 3 INITIAL DATE, DENOMINATION, NUMBER, MATURI-
TIES, INITIAL REGISTERED OWNER, AND CHARACTERISTICS OF THE
INITIAL CERTIFICATE
(a) The Initial Certificate is hereby authorized to be
· ssued, sold, and delivered hereunder as a single fully
registered Certificate, without interest coupons, dated March
1, 1992, in the denomination and aggregate principal amount of
$1,325,000, numbered R-l, payable in annual installments of
principal to the initial registered owner thereof, to-w~t
PAINEWEBBER, INC ,
or to the registered assignee or assignees of said Certificate
or any portion or portions thereof (in each case, the "regis-
tered owner"), w~th the annual installments of principal of the
Initial Certificate to be payable on the dates, respectively,
and in the principal amounts, respectively, stated in the FORM
OF INITIAL CERTIFICATE set forth in this Ordinance
(b) The Initial Certificate (1) may be assigned and
transferred, (il) may be converted and exchanged for other
Certificates, (Iii) shall have the characteristics, and (iv)
shall be signed and sealed, and the principal of and interest
on the Initial Certificate shall be payable, all as provided,
and in the manner required or indicated, in the FORM OF INITIAL
CERTIFICATE set forth in th~s Ordinance
Section 4 INTEREST The unpaid principal balance of the
Initial Certificate shall bear interest from the date of the
Initial Certificate to the respective scheduled due dates of
the installments of principal of the Initial Certificate, and
said ~nterest shall be payable, all in the manner provided and
at the rates and on the dates stated in the FORM OF INITIAL
CERTIFICATE set forth in this Ordinance
Section 5 FORM OF INITIAL CERTIFICATE The form of the
Initial Certificate, including the form of Registration Certif-
icate of the Comptroller of Public Accounts of the State of
Texas to be endorsed on the Initial Certificate, shall be
substantially as follows
F0~M OF INITIAL CERTIFICATE
NO R-1 $1,325,000
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON CERTIFICATE OF OBLIGATION
SERIES 1992
THE CITY OF DENTON, in Denton County, Texas (the "Issu-
er''), being a political subdivision of the State of Texas,
hereby promises to pay to
PAINEWEBBER, INC ,
or to the registered assignee or assignees of this Certificate
or any portion or portions hereof (in each case, the "regis-
tered owner") the aggregate principal amount of
$1,325,000
(ONE MILLION THREE HUNDRED TWENTY FIVE THOUSAND DOLLARS)
in annual installments of principal due and payable on JULY 1
in each of the years, and in the respective principal amounts,
as set forth in the following schedule
PRINCIPAL PRINCIPAL
YEAR ~ YEAR ~MOUNT
1993 $230,000 2001 $70,000
1994 245,000 2002 75,000
1995 255,000 2003 30,000
1996 50,000 2004 30,000
1997 55,000 2005 30,000
1998 55,000 2006 35,000
1999 60,000 2007 40,000
2000 65,000
and to pay interest, calculated on the basis of a 360-day year
composed of twelve 30-day months, from the date of this Certif-
icate hereinafter stated, on the balance of each such
3
installment of principal, respectively, from time to time
remaining unpaid, at the rates as follows
7 40% per annum on the above installment due in 1993
6 50% per annum on the above installment due in 1994
4 40% per annum on the above installment due in 1995
4 70% per annum on the above installment due in 1996
4 90% per annum on the above Installment due in 1997
5 10% per annum on the above installment due in 1998
5 30% per annum on the above installment due in 1999
5 50% per annum on the above installment due in 2000
5 75% per annum on the above Installment due in 2001
5 90% per annum on the above installment due in 2002
5 75% per annum on the above installment due in 2003
5 75% per annum on the above installment due in 2004
5 75% per annum on the above installment due in 2005
5 75% per annum on the above installment due in 2006
5 75% per annum on the above installment due in 2007
with said interest being payable on JANUARY 1, 1993, and semi-
annually on each JULY i and JANUARY 1 thereafter while this
Certificate or any portion hereof is outstanding and unpaid
THE INSTALLMENTS OF PRINCIPAL OF AND THE INTEREST ON this
Certificate are payable in lawful money of the United States of
America, without exchange or collection charges The install-
ments of principal and the interest on this Certificate are
payable to the registered owner hereof through the services of
NATIONSBANK OF TEXAS, N A , FORT WORTH, TEXAS, which is the
"Paying Agent/Registrar" for this Certificate Payment of all
principal of and interest on this Certificate 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 Certificate (the
,'Certificate 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 Registra-
tion Books kept by the Paying Agent/Registrar, as hereinafter
described The Issuer covenants with the registered owner of
this Certificate that on or before each principal and/or
interest payment date for this Certificate it will make avail-
able to the Paying Agent/Registrar, from the "Interest and
Sinking Fund" created by the Certificate Ordinance, the amounts
requlred to provide for the payment, in immediately available
funds, of all principal of and interest on this Certificate,
when due
IF THE DATE for the payment of the principal of or inter-
est on this Certificate 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 CERTIFICATE has been authorized in accordance with
the Constitution and laws of the State of Texas FOR THE PURPOSE
OF PAYING ALL OR A PORTION OF THE CITY'S CONTRACTUAL OBLIGA-
TIONS INCURRED (1) PURSUANT TO CONTRACTS FOR THE CONSTRUCTION
OF PUBLIC WORKS, TO-WIT (a) REPLACING AIR CONDITIONING
SYSTEMS IN CITY BUILDINGS, (b) REPLACING ROOFS ON CITY BUILD-
INGS~ (c) CONSTRUCTING AND REPAIRING PARKING LOTS FOR CITY
BUILDINGS, (d) INSTALLING ELECTRICAL EQUIPMENT IN CITY BUILD-
INGS, (e) RENOVATING CITY BUILDINGS, (f) CONSTRUCTING NEW
SIDEWALKS AT CITY BUILDINGS, (g) RENOVATING THE CITY SWIMMING
POOL, (h) INSTALLING SECURITY SYSTEMS IN CITY BUILDINGS, AND
(i) INSTALLING SOUND SYSTEMS IN CITY BUILDINGS, AND (2) PURSU-
ANT TO CONTRACTS FOR THE PURCHASE OF THE FOLLOWING EQUIPMENT
FOR CITY USE TWO REFUSE TRUCKS, A DUMP TRUCK, A STREET POTHOLE
PATCHER, A TRAFFIC SIGNAL BUCKET TRUCK, A FIRE DEPARTMENT
AMBULANCE, FIRE DEPARTMENT EMERGENCY MEDICAL EQUIPMENT, A
SUBURBAN AUTOMOBILE, AND TWELVE POLICE CARS, AND ALSO FOR THE
PURPOSE OF PAYING ALL OR A PORTION OF THE CITY'S CONTRACTUAL
OBLIGATIONS FOR PROFESSIONAL SERVICES OF ENGINEERING, ATTOR-
NEYS, AND FINANCIAL ADVISORS IN CONNECTION WITH THE ABOVE
CONTRACTS AND SAID CERTIFICATES OF OBLIGATION
ON JULY 1, 1997, or on any date whatsoever thereafter, the
unpaid installments of principal of this Certificate may be
prepaid or redeemed prior to their scheduled due dates, at the
opt~on of the Issuer, with funds derived from any available
source, es a whole, or in part, and, if in part, the particular
portion of this Certificate to be prepaid or redeemed shall be
selected and designated by the Issuer (provided that a portion
of this Certificate may be redeemed only in an integral multi-
ple 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
prepaymeRt 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 prepayment or redemption price for this Certificate or
the port~on 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 ~f due provision for such payment is made, all as
provided above, this Certificate, 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 inter-
est 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 ~n the
Registration Books all such prepayments or redemptions of
principal of this Certificate or any portion hereof
THIS CERTIFICATE, to the extent of the unpaid principal
balance hereof, or any unpaid portlon hereof in any integral
multiple of $5,000, may be assigned by the lnltlal registered
owner hereof and shall be transferred only in the Registratlon
Books of the Issuer kept by the Paying Agent/Registrar acting
in the capacity of registrar for the Certificates, upon the
terms and conditions set forth in the Certificate Ordinance
Among other requirements for such transfer, this Certlflcate
must be presented and surrendered to the Paying Agent/Registrar
for cancellation, together with proper instruments of assign-
ment, in form and with guarantee of signatures satisfactory to
the Paying Agent/Registrar, evidencing assignment by the
~nltial registered owner of this Certificate, or any portion or
portions hereof in any integral multiple of $5,000, to the
assignee or assignees in whose name or names this Certificate
or any such portion or portions hereof is or are to be trans-
ferred and registered Any ~nstrument or ~nstruments of
assignment satisfactory to the Paying Agent/Registrar may be
used to evidence the assignment of this Certificate or any such
portion or portions hereof by the initial registered owner
hereof A new certificate or certificates payable to such
assignee or assignees (which then will be the new registered
owner or owners of such new Certificate or Certiflcates) or to
the initial registered owner as to any portion of this Certifi-
cate which is not belng assigned and transferred by the initial
registered owner, shall be delivered by the Paying
6
Agent/Registrar in conversion of and exchange for this Certifi-
cate,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 Certificate or any portion
hereof The registered owner of this Certificate 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 Certificate 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 Certificate Ordinance, this
Certificate, to the extent of the unpaid principal balance
hereof, may be converted into and exchanged for a like aggre-
gate principal amount of fully registered certificates, without
interest coupons, payable to the assignee or assignees duly
designated in writing by the initial registered owner hereof,
or to the initial registered owner as to any portion of this
Certificate 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 certificate issued in
exchange for any portion of this Certificate shall have a
single stated principal maturity date), upon surrender of this
Certificate to the Paying Agent/Registrar for cancellation, all
in accordance with the form and procedures set forth in the
Certificate Ordinance If this Certificate or any portion
hereof is assigned and transferred or converted each certifi-
cate 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 Certificate or
portion hereof for which the substitute certificate is being
exchanged, and shall bear interest at the rate applicable to
and borne by such installment of principal or portion thereof
No such certificate shall be payable in installments, but shall
have only one stated principal maturity date AS PROVIDED IN
THE CERTIFICATE ORDINANCE, THIS CERTIFICATE IN ITS PRESENT FORM
MAY BE ASSIGNED AND TRANSFERRED OR CONVERTED ONCE ONLY, and to
one or more assignees, but the certificates issued and de-
livered in exchange for this Certificate or any portion hereof
may be assigned and transferred, and converted, subsequently,
as provided in the Certificate Ordinance The Issuer shall pay
the Paying Agent/Registrar's standard or customary fees and
charges for transferring, converting, and exchanging this
Certificate 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 during the period
commencing with the close of business on any Record Date and
ending with the opening of business on the next following
prln¢ipaI or interest payment date
IN THE EVENT any Paying Agent/Registrar for this Certifi-
cate is changed by the Issuer, resigns, or otherwise ceases to
act as such, the Issuer has covenanted in the Certificate
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
Certificate
IT IS HEREBY certified, recited, and covenanted that this
Certificate has been duly and validly authorized, issued, 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 Certificate
have been performed, existed, and been done in accordance with
law, that this Certificate 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 Certificate, 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,
withln the limit prescribed by law, and that, together with
other parity obligations, this Certificate additionally is
payable from and secured by certain surplus revenues (not to
exceed $10,000 in aggregate amount) derived by the Issuer from
the ownership and operation of the city's Utility System
(consisting of the City's combined waterworks system, sanitary
sewer system, and electric light and power system), all as
provided in the Certificate Ordinance
THE ISSUER has reserved the right to issue, in accordance
with law, and in accordance with the Certificate Ordinance,
other and additional obligations, and to enter into contracts,
payable from ad valorem taxes and/or revenues of the City's
Utility System, on a parity with, or with respect to said
revenues, superior in lien to, this Certificate
BY BECOMING the registered owner of this Certificate, the
registered owner thereby acknowledges all of the terms and
provisions of the Certificate Ordinance, agrees to be bound by
such terms and provisions, acknowledges that the Certificate
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
Certificate and the Certificate Ordinance constitute a contract
between the registered owner hereof and the Issuer
IN WITNESS WHEREOF, the Issuer has caused this Certificate
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 Certificate, and has caused
this Certificate to be dated MARCH 1, 1992
City Secretary, Mayor,
city of Denton, Texas C~ty 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 Certificate has been examined,
certified as to validity, and approved by the Attorney General
of the State of Texas, and that this Certificate has been
registered by the Comptroller of Public Accounts of the State
of Texas
Witness my signature and seal this
Comptroller of Public Accounts
of the State of Texas
(COMPTROLLER'S SEAL)
Section 6 ADDITIONAL CHARACTERISTICS OF THE CERTIFI-
CATES ~eqSstration and Transfer (a) The Issuer shall keep
or cause to be kept at the principal corporate trust office of
NATIONSBANK OF TEXAS, N A , FORT WORTH, TEXAS (the "Paying
Agent/Registrar") books or records of the registration and
transfer of the Certificates (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/Regxstrar 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 Registration
Books the address of the registered owner of each Certificate
to Which payments with respect to the Certificates shall be
mal~ed, as herein provided, but it shall be the duty of each
registered owner to notify the Paying Agent/Registrar in
9
writing of the address to which payments shall be mailed, and
such interest payments shall not be mailed unless such not~ce
has been given The Issuer shall have the right to inspect the
Registration Books during regular buslness 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 lnspect~on by any other
entity Registration of each Certificate may be transferred In
the Registration Books only upon presentatlon and surrender of
such Certificate to the Paying Agent/Registrar for transfer of
registration and cancellation, together w~th proper written
instruments of assignment, in form and with guarantee of
s~gnatures satisfactory to the Paying Agent/Reglstrar, (~)
evldenclng the assignment of the Certificate, or any port~on
thereof in any integral multlple of $5,000, to the asslgnee or
asslgnees thereof, and (~) the r~ght of such asslgnee or
assignees to have the Certificate or any such portion thereof
registered in the name of such assignee or assignees Upon
the assignment and transfer of any Certificate or any port~on
thereof, a new substitute Certificate or Certificates shall be
~ssued ~n conversion and exchange therefor ~n the manner herein
provided The Initial Certlflcate, to the extent of the unpald
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 reglstered
owner thereof All Certificates issued and delivered ~n
conversion of and exchange for the In~tlal Certificate shall be
In any denom~natlon or denominatlons of any ~ntegral multiple
of $5,000 (subject to the reql/irement hereinafter stated that
each substitute Certificate shall have a single stated prlnc~-
pal maturity date), shall be in the form prescribed ~n the FORM
OF SUBSTITUTE CERTIFICATE set forth In th~s Ordinance, and
shall have the characteristics, and may be assigned, trans-
ferred, and converted as hereinafter provided If the Initial
Certificate or any portion thereof ls assigned and transferred
or aonverted the Initial Certificate must be surrendered to the
Paying Agent/Registrar for cancellation, and each Certificate
· ssued in exchange for any portion of the Initial Certificate
shall have a single stated principal maturlty date, and shall
not be payable in installments, and each such Cert~flcate shall
have a principal maturity date corresponding to the due date of
the installment of principal or portion thereof for whlch the
substitute Certificate is being exchanged, and each such
Certificate 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 only a portion of
the Initial Certificate is assigned and transferred, there
shall be delivered to and registered in the name of the initial
registered owner substitute Certificates In exchange for the
unassigned balance of the Inltial Certificate in the same
10
manner as if the initial registered owner were the assignee
thereof If any Certificate or portion thereof other than the
Initial Certificate is assigned and transferred or converted
each Certificate issued in exchange therefor shall have the
same principal maturity date and bear interest at the same rate
as the Certificate for which it is exchanged A form of
assignment shall be printed or endorsed on each Certificate,
excepting the Initial Certificate, which shall be executed by
the registered owner or 1ts duly authorized attorney or repre-
sentative to evidence an assignment thereof Upon surrender of
any Certificates or any portion or portions thereof for trans-
fer 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
Certificate or Certificates, having the characteristics herein
described, payable to such assignee or assignees (which then
will be the registered owner or owners of such new Certificate
or Certificates), or to the previous registered owner in case
only a portion of a Certificate is being assigned and trans-
ferred, all in conversion of and exchange for said assigned
Certificate or Certificates 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 ex-
change of Certificates by any registered owner of a Certifi-
cate. The Issuer shall pay the Paying Agent/Reglstrar's
standard or customary fees and charges for making such transfer
and delivery of a substitute Certificate or Certificates, 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 Certificate or any portion
thereof 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
(b) Ownership of Certificates The entity in whose name
any Certificate 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
Certificate 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 Certificate shall be
madeI only to such registered owner Ail such payments shall be
valid and effectual to satisfy and discharge the liability upon
such Certificate to the extent of the sum or sums so paid
(c) Payment of Certificates 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
11
the Certificates, and to act as Its agent to convert and
exchange or replace Certificates, 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 Certificates, and of all
conversions and exchanges of Certificates, and all replacements
of Certificates, as provided in this Ordinance
(d) Conversion and Exchange or Replacement, Authenti-
cation Each Certificate issued and delivered pursuant to this
Ordinance, to the extent of the unpaid principal balance or
principal amount thereof, may, upon surrender of such Certifi-
cate 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 represen-
tatives, 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 con-
verted into and exchanged for fully registered certificates,
without interest coupons, in the form prescribed in the FORM OF
SUBSTITUTE CERTIFICATE 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 Certificate 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 principal balance or principal amount of any
Certificate or Certificates so surrendered, and payable to the
appropriate registered owner, assignee, or assignees, as the
case may be If the Initial Certificate is assigned and
transferred or converted each substitute Certificate issued in
exchange for any portion of the Initial Certificate shall have
a single stated principal maturity date, and shall not be
payable in installments, and each such Certificate shall have a
principal maturity date corresponding to the due date of the
Installment of principal or portion thereof for which the
substitute Certificate is being exchanged, and each such
Certificate 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 any Certificate or
portion thereof (other than the Initial Certificate) Ks as-
signed and transferred or converted, each Certificate issued in
exchange therefor shall have the same principal maturity date
and bear interest at the same rate as the Certificate for which
it is being exchanged Each substitute Certificate shall bear
a letter and/or number to distinguish at from each other
Certificate The Paying Agent/Registrar shall convert and
exchange or replace Certificates as provided herein, and each
fully registered certificate delivered an conversion of and
12
exchange for or replacement of any Certificate or portion
thereof as permitted or required by any provision of this
Ordinance shall constitute one of the Certificates for all
purposes of this Ordinance, and may again be converted and
exchanged or replaced It is specifically provided that any
Certificate authenticated in conversion of and exchange for or
replacement of another Certificate on or prior to the first
scheduled Record Date for the Initial Certificate shall bear
interest from the date of the Initial Certificate, but each
substitute Certificate so authenticated after such first
scheduled Record Date shall bear interest from the interest
payment date next preceding the date on which such substitute
Certificate was so authenticated, unless such Certificate 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 Certificate the interest on the Certificate for
which it is being exchanged is due but has not been paid, then
such Certificate shall bear interest from the date to which
such interest has been paid in full THE INITIAL CERTIFICATE
Issued and delivered pursuant to this Ordinance ~s not required
to be, and shall not be, authenticated by the Paying Agent/-
Registrar, but on each substitute Certificate issued in conver-
sion of and exchange for or replacement of any Certificate or
Certificates issued under this Ordinance there shall be printed
a certificate, in the form substantially as follows
"PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
It is hereby certified that this Certificate has been
issued under the provisions of the Certificate Ordinance
described on the face of this Certificate, and that this
Certificate has been issued in conversion of and exchange for
or replacement of a certificate, certificates, or a portion of
a certificate or certificates 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
NATIONSB~tNK OF TEXAS, N A ,
FORT WORTH, TEXAS
Paying Agent/Registrar
Dated By
Authorized Representative"
An authorized representative of the Paying Agent/Registrar
shall, before the delivery of any such Certificate, date and
manually sign the above Certificate, and no such Certificate
13
shall be deemed to be issued or outstanding unless such Certif-
icate is so executed The Paying Agent/Registrar promptly
shall cancel all Certificates 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 Certif-
icate or portion thereof, and the Paying Agent/Registrar shall
provide for the printing, execution, and delivery of the
substitute Certificates in the manner prescribed herein, and
said Certificates 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 Clv St Art
717k-6, and particularly Section 6 thereof, the duty of conver-
sion and exchange or replacement of Certificates as aforesaid
is hereby imposed upon the Paying Agent/Registrar, and, upon
the execution of the above Paying Agent/Reglstrar's Authentica-
tion Certificate, the converted and exchanged or replaced
Certificate shall be valid, incontestable, and enforceable in
the same manner and with the same effect as the Initial Certif-
icate which originally was issued pursuant to this Ordinance,
approved by the Attorney General, and registered by the Comp-
troller of Public Accounts The Issuer shall pay the Paying
Agent/Registrar's standard or customary fees and charges for
transferring, converting, and exchanging any Certificate 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 Certif-
icates 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, (il) with respect to any Certificate
or portion thereof called for redemption prior to maturity,
within 45 days prior to its redemption date
(e) ~ General Ail Certificates issued in conversion
and exchange or replacement of any other Certificate or portion
thereof, (i) shall be issued in fully registered form, without
interest coupons, with the principal of and interest on such
Certificates to be payable only to the registered owners
thereof, (ii) may be transferred and assigned, (iii) may be
converted and exchanged for other Certificates, (iv) shall have
the characteristics, (v) shall be signed and sealed, and (vi)
the principal of and interest on the Certificates shall be pay-
able, all as provided, and in the manner required or indicated,
14
in the FORM OF SUBSTITUTE CERTIFICATE set forth in this Ordi-
nance
(f) Payment of Fees and Char~es The Issuer hereby
covenants with the registered owners of the Certificates 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 Certificates,
when due, and (ii) pay the fees and charges of the Paying
Agent/Registrar for services with respect to the transfer of
registration of Certificates, and with respect to the conver-
sion and exchange of Certificates solely to the extent above
provided in this Ordinance
(g) Sgbstitute Pavina Aaent/Re~lstrar The Issuer
covenants with the registered owners of the Certificates that
at all times while the Certificates 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 Certifi-
cates 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 Regis-
tratlon Books (or a copy thereof), along with all other perti-
nent books and records relating to the Certificates, 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
Certificates, 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 perform-
lng as such, each Paying Agent/Registrar shall be deemed to
have agreed to the provisions of this Ordinance, and a cer-
tified copy of this Ordinance shall be delivered to each Paying
Agent/Registrar
15
Section 7 FORM OF SUBSTITUTE CERTIFICATES The form of
all Certificates issued in conversion and exchange or replace-
ment of any other Certificate or portlon thereof, including the
form of Paying Agent/Registrar's Certificate to be printed on
each of such Certificates, and the Form of Asslgnment to be
printed on each of the Certlficates, shall be, respectlvely,
substantially as follows, with such appropriate varlatlons,
omissions, or insertions as are permitted or required by th~s
Ordinance
FORM OF SUBSTITUTE CERTIFICATE
NO UNITED STATES OF AMERICA PRINCIPAL AMOUNT
STATE OF TEXAS $
COUNTY OF DENTON
CITY OF DENTON CERTIFICATE OF OBLIGATION
SERIES 1992
ORIGINAL ISSUE
L~ ~ DATE CUSIP NO
% March 1, 1992
ON THE MATURITY DATE speclfied 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 MARCH 1,
1992, to the maturity date specified above, at the interest
rate per annum specified above, with ~nterest being payable on
JANUARY 1, 1993, and semiannually on each JULY 1 and JANUARY 1
thereafter, except that if the date of authent~catlon of thls
Certificate 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 authentica-
tion, 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 ~nterest payment
date
THE PRINCIPAL OF AND INTEREST ON this Certificate are
payable ~n lawful money of the United States of America,
without exchange or collection charges The principal of this
16
Certificate shall be paid to the registered owner hereof upon
presentation and surrender of this Certificate at maturity, at
the principal corporate trust office of NATIONS BANK OF TEXAS,
N A , FORT WORTH, TEXAS, which is the "Paying Agent/Registrar"
for this Certificate The payment of interest on this Certifi-
cate shall be made by the Paying Agent/Registrar to the regis-
tered 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 Certificates (the "Certificate 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 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 15th day of the month next
preceding each such date (the "Record Date") on the Registra-
tion 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 regis-
tered owner hereof Any accrued interest due upon the redemp-
tion of this Certificate prior to maturity as provided herein
shall be paid to the registered owner at the principal corpo-
rate trust office of the Paying Agent/Registrar upon presenta-
tion and surrender of this Certificate for redemption and
payment at the principal corporate trust office of the Paying
Agent/Registrar The Issuer covenants with the registered
owner of this Certificate that on or before each principal
payment date, interest payment date, and accrued interest
payment date for this Certificate it will make available to the
Paying Agent/Registrar, from the "Interest and Sinking Fund"
created by the Certificate Ordinance, the amounts required to
provide for the payment, in immediately available funds, of all
principal of and interest on the Certificates, when due
IF THE DATE for the payment of the principal of or inter-
est on this Certificate 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 CERTIFICATE is one of an issue of Certificates
initially dated MARCH 1, 1992, authorized in accordance with
17
the Constitution and laws of the State of Texas in the princ-
ipal amount of $1,325,000, FOR THE PURPOSE OF PAYING ALL OR A
PORTION OF THE CITY'S CONTRACTUAL OBLIGATIONS INCURRED (1)
PURSUANT TO CONTRACTS FOR THE CONSTRUCTION OF PUBLIC WORKS,
TO-WIT (a) REPLACING AIR CONDITIONING SYSTEMS IN CITY BUILD-
INGS, (b) REPLACING ROOFS ON CITY BUILDINGS, (c) CONSTRUCTING
AND REPAIRING PARKING LOTS FOR CITY BUILDINGS, (d) INSTALLING
ELECTRICAL EQUIPMENT IN CITY BUILDINGS, (e) RENOVATING CITY
BUILDINGS, (f) CONSTRUCTING NEW SIDEWALKS AT CITY BUILDINGS,
(g) RENOVATING THE CITY SWIMMING POOL, (h) INSTALLING SECURITY
SYSTEMS IN CITY BUILDINGS, AND (1) INSTALLING SOUND SYSTEMS IN
CITY BUILDINGS, AND (2) PURSUANT TO CONTRACTS FOR THE PURCHASE
OF THE FOLLOWING EQUIPMENT FOR CITY USE TWO REFUSE TRUCKS, A
DUMP TRUCK, A STREET POTHOLE PATCHER, A TRAFFIC SIGNAL BUCKET
TRUCK, A FIRE DEPARTMENT AMBULANCE, FIRE DEPARTMENT EMERGENCY
MEDICAL EQUIPMENT, A SUBURBAN AUTOMOBILE, AND TWELVE POLICE
CARS, AND ALSO FOR THE PURPOSE OF PAYING ALL OR A PORTION OF
THE CITY'S CONTRACTUAL OBLIGATIONS FOR PROFESSIONAL SERVICES OF
ENGINEERING, ATTORNEYS, AND FINANCIAL ADVISORS IN CONNECTION
WITH THE ABOVE CONTRACTS AND SAID CERTIFICATES OF OBLIGATION
ON JULY 1, 1997, or on any date whatsoever thereafter, the
Certificates 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 Certificates, or portions
thereof, to be redeemed shall be selected and designated by the
Issuer (provided that a portion of a Certificate may be re-
deemed only in an integral multiple of $5,000), at the redemp-
tion 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 redemp-
tion of Certificates or portions thereof prior to maturity a
written notice of such redemption shall be published once in a
financial publication, journal, or reporter of general circula-
tion 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 mall,
first-class postage prepaid, not less than 30 days prior to the
date fixed for any such redemption, to the registered owner of
each Certificate 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 Certificate, and it ls
18
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 redemp-
tion of any Certificates or portions thereof By the date
f~xed for any such redemption due provision shall be made with
the Paying Agent/Registrar for the payment of the required
redemption price for the Certificates or portions thereof which
are to be so redeemed, plus accrued interest thereon to the
date fixed for redemption If such written notice of redemp-
tion is published and if due provision for such payment is
made, all as provided above, the Certificates or portions
thereof which 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 redemp-
tion, 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 Certificate shall be redeemed a substitute
Certificate or Certificates 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 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 certificate Ordinance
THIS CERTIFICATE OR ANY PORTION OR PORTIONS HEREOF IN ANY
INTEGRAL MULTIPLE OF $5,000 may be assigned and shall be trans-
ferred only in the Registration Books of the Issuer kept by the
Paying Agent/Registrar acting in the capacity of registrar for
the Certificates, upon the terms and conditions set forth in
the Certificate Ordinance Among other requirements for such
assignment and transfer, this Certificate 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, evidenc-
ing assignment of thls Certificate or any portion or portions
hereof in any integral multiple of $5,000 to the assignee or
assignees in whose name or names this Certificate or any such
portion or portions hereof is or are to be transferred and
registered The form of Assignment printed or endorsed on th~s
Certificate shall be executed by the registered owner or its
duly authorized attorney or representative, to evidence the
assignment hereof A new Certificate or Certificates payable
to such assignee or assignees (which then will be the new
registered owner or owners of such new Certificate or Certifi-
cates), or to the previous registered owner in the case of the
asslgnment and transfer of only a port~on of this Certificate,
19
may be delivered by the Paying Agent/Registrar in conversion of
and exchange for this Certificate, all in the form and manner
as provlded in the next paragraph hereof for the conversion and
exchange of other Certificates The Issuer shall pay the
Paying Agent/Reglstrar'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 thls
Certlficate or any portion hereof during the period commenclng
w~th the close of business on any Record Date and ending with
the opening of buslness on the next following principal or
interest payment date The registered owner of this Certifi-
cate 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 Certifi-
cate 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 CERTIFICATES OF THIS SERIES are ~ssuable solely as
fully registered certificates, without ~nterest coupons, ~n the
denomination of any integral multiple of $5,000 As provided
in the Certificate Ordinance, this Certificate, may, at the
request of the registered owner or the assignee or assignees
hereof, be converted into and exchanged for a llke aggregate
principal amount of fully registered certlf~cates, without
lnterest 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 ~n any ~ntegral multlple of
$5,000 as requested in writing by the appropriate registered
owner, assignee, or assignees, as the case may be, upon sur-
render of this Certificate to the Paying Agent/Registrar for
cancellation, all in accordance wlth the form and procedures
set forth in the Certificate Ordinance The Issuer shall pay
the Paying Agent/Registrar's standard or customary fees and
charges for transferring, converting, and exchanging any
Certificate 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 prlvilege of
conversion and exchange The Paying Agent/Registrar shall not
be required to make any such conversion and exchange 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
IN THE EVENT any Paying Agent/Registrar for the Certifi-
cates is changed by the Issuer, resigns, or otherwise ceases to
2O
act as such, the Issuer has covenanted in the Certificate
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
Certificates
IT IS HEREBY certified, recited, and covenanted that this
Certificate has been duly and validly authorized, issued, 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 Certificate
have been performed, existed, and been done in accordance with
law, that this Certificate 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 Certificate, 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, and that, together with
other parity obligations, this Certificate, and the other
Certificates of this Series, additionally are payable from and
secured by certain surplus revenues (not to exceed $10,000 in
aggregate amount) derived by the Issuer from the ownership and
operation of the City's Utility System (consisting of the
City's combined waterworks system, sanitary sewer system, and
electric light and power system), all as provided in the
Certificate Ordinance
THE ISSUER has reserved the right to issue, in accordance
wxth law, and in accordance wxth the Certificate Ordinance,
other and additional obligations, and to enter into contracts,
payable from ad valorem taxes and/or revenues of the City's
Utility System, on a parity with, or with respect to said
revenues, superior in lien to, this Certificate
BY BECOMING the registered owner of this Certificate, the
registered owner thereby acknowledges all of the terms and
provisions of the Certificate Ordinance, agrees to be bound by
such terms and provisions, acknowledges that the Certificate
Ordinance is duly recorded and available for ~nspection ~n the
official minutes and records of the governing body of the
Issuer, and agrees that the terms and provisions of this
Certificate and the Certificate Ordinance constitute a contract
between each registered owner hereof and the Issuer
IN WITNESS WHEREOF, the Issuer has caused this Certificate
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
21
of the Issuer to be duly impressed, or placed in facslmlle, on
thls Certificate
(facsimile slanature) (facsimile slanature)
city Secretary, Mayor,
City of Denton, Texas City of Denton, Texas
(CITY SEAL)
F0~ OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
It ~s hereby certified that thls Certificate has been
issued under the provisions of the Certificate Ordinance
descrlbed on the face of th~s Certificate, and that th~s
Certificate has been issued ~n conversion of and exchange for
or replacement of a certificate, certlflcates, or a portlon of
a certificate or certificates of an issue which or~glnally 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 ,
FORT WORTH, TEXAS
Paying Agent/Registrar
Dated By
Authorized Representative
FORM OF ASSIGNMENT
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned registered owner of
this Certificate, or duly authorized representative or attorney
thereof, hereby assigns this Certificate to
!
(Assignee's Social (print or typewrite Asslgnee's name and
Security or Taxpayer address, including zip code)
Identification Number
andhereby Irrevocably constitutes and appoints
22
attorney to transfer the registration of this Certificate on
the Paying Agent/Registrar's Registration Books with full power
of substitution in the premises
Dated
Signature Guaranteed
NOTICE This signature must be Registered Owner
guaranteed by a member of the NOTICE This signature must
New York Stock Exchange or a correspond with the name of
commercial bank or trust the Registered Owner appear-
lng on the face of th~s Cer-
company
tificate
Section 8 TAX LEVY A special Interest and Sinking Fund
(the "Interest and Sinking Fund") is hereby created solely for
the benefit of the Certificates, and the Interest and sinking
Fund shall be established and ma~ntalned 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 Certificates Ail
ad valorem taxes levied and collected for and on account of the
Certificates shall be deposited, as collected, to the credit of
the Interest and Sinking Fund During each year while any of
the Certificates 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 Certificates as such interest becomes due, and
to provide and maintain a sinking fund adequate to pay the
principal of its Certificates as such principal matures (but
never less than 2% of the original principal amount of the
Certificates 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
Certificates 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 Certificates,
as such interest comes due and such principal matures, are
hereby pledged for such payment, within the limit prescribed by
law
23
Section 9 SURPLUS REVENUES The Certificates addi-
tionally shall be payable from and secured by surplus revenues,
to the extent hereinafter permitted, derived by the Issuer from
the ownership and operation of the Issuer's Utility System
(consisting of its combined waterworks system, sanitary sewer
system, and electric light and power system) remaining after
(a) payment of all amounts constituting operation and main-
tenance expenses of said Utility System, and (b) payment of all
debt service, reserve, and other requirements and amounts
required to be paid under all ordinances heretofore or here-
after authorizing (i) all bonds and (il) all other obligations
not on a parity with the Certificates, which are payable from
and secured by any Utility System revenues, and (c) payment of
all amounts payable from any Utility System revenues pursuant
to contracts heretofore or hereafter entered Into by the Issuer
in accordance with law (the "Surplus Revenues") If, for any
reason, the Issuer fails to deposit ad valorem taxes levied
pursuant to Section 8 hereof to the credit of the Interest and
Sinking Fund in an amount sufficient to pay, when due, the
principal of and interest on the Certificates, then Surplus
Revenues, to the extent hereinafter permitted, shall be depos-
ited to the credit of the Interest and Sinking Fund and used to
pay such principal and/or interest A maximum aggregate of
$10,000 of Surplus Revenues may be used to pay principal and/or
interest On the Certificates and any obligations on a parity
therewith The Certificates and any obligations on a parity
therewith are not, and shall not be deemed to be, payable from
or secured by any Surplus Revenues in excess of an aggregate of
$10,000 Until and unless an aggregate of $10,000 of Surplus
Revenues actually is used to pay any such principal and/or
interest, additional obligations, payable from and secured by
all or any remaining unused part of said aggregate of $10,000
of Surplus Revenues, may be issued by the Issuer on a parity
with the Certificates and any other then outstanding parity
obligations, with the Certificates and all such additional
parity obligations to be payable from and secured equally and
ratably by all or any remaining unused part of said aggregate
The Issuer reserves, and shall have, the right to issue bonds,
and other obligations not on a parity with the Certificates,
and to enter into contracts, in accordance w~th applicable
laws, to be payable from and secured by any Utility System
revenues other than the aggregate of $10,000 of Surplus Reve-
nues as described above The Certificates are on a parity with
those issues of City of Denton Certificates of Obligation,
Series 1987-A, Series 1989, Series 1989-A, and Series 1991, as
permitted in the Ordinances authorizing same, and it is hereby
found and determined that none of the above defined Surplus
Revenues have ever been used to pay any principal and/or
interest on said city of Denton Certificates of Obligation,
Series 1987-A, Series 1989, Series 1989-A, or Series 1991
24
Section l0 DEFEASANCE OF CERTIFICATES (a) Any Certif-
icate and the interest thereon shall be deemed to be paid,
retired, and no longer outstanding (a "Defeased Certificate")
within the meaning of this Ordinance, except to the extent
provided in subsection (d) of this Section, when payment of the
principal of such Certificate, plus interest thereon to the due
date either (1) shall have been made or caused to be made
accordance with the terms thereof, or (Il) shall have been
provided for on or before such due date by irrevocably deposit-
ing 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 rein-
vestment, 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 Certificates shall have become due and payable
At such time as a Certificate shall be deemed to be a Defeased
Certificate hereunder, as aforesaid, such Certificate 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/Regis-
trar may at the written direction of the Issuer also be
vested 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 Certificates 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 Certificates shall have become due
and payable, the Paying Agent/Registrar shall perform the
services of Paying Agent/Registrar for such Defeased Certifi-
cates the same as if they had not been defeased, and the Issuer
25
shall make proper arrangements to provide and pay for such
services as required by this ordinance
Section 11 DAMAGED, MUTILATED, LOST, STOLEN, OR DE-
STROYED CERTIFICATES (a) ~eplacement Certificates In the
event any outstanding Certificate is damaged, mutilated, lost,
stolen, or destroyed, the Paying Agent/Registrar shall cause to
be printed, executed, and delivered, a new certificate of the
same principal amount, maturity, and interest rate, as the
damaged, mutilated, lost, stolen, or destroyed Certificate, in
replacement for such Certificate in the manner hereinafter
provided
(b) ADDllCatlon for Replacement Certificates Applica-
tion for replacement of damaged, mutilated, lost, stolen, or
destroyed Certificates shall be made by the registered owner
thereof to the Paying Agent/Registrar In every case of loss,
theft, or destruction of a Certificate, the registered owner
applying for a replacement certificate shall furnish to the
Issuer and to the Paying Agent/Registrar such security or
Indemnity as may be req~/ired 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 Certificate,
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 Certificate, as the case may be
In every case of damage or mutilation of a Certificate, the
registered owner shall surrender to the Paying Agent/Registrar
for cancellation the Certificate so damaged or mutilated
(c) NO Default occurred Notwithstanding the foregoing
provisions of this Section, in the event of any such Certifi-
cate shall have matured, and no default has occurred which is
then continuing in the payment of the prlnclpal of, or interest
on the Certificate, the Issuer may authorize the payment of the
same (without surrender thereof except in the case of a damaged
or mutilated Certificate) instead of issuing a replacement
Certificate, provided security or indemnity is furnished as
above provided in this Sectlon
(d) Charae for Issuina Replacement Certificates Prior
to the issuance of any replacement certificate, the Paying
Agent/Registrar shall charge the registered owner of such
Certificate with all legal, printing, and other expenses in
connection therewith Every replacement certificate issued
pursuant to the provisions of this Section by virtue of the
fact that any Certificate ls lost, stolen, or destroyed shall
constitute a contractual obligation of the Issuer whether or
not the lost, stolen, or destroyed Certificate shall be found
at any time, or be enforceable by anyone, and shall be entitled
26
to all the benefits of this Ordinance equally and proportion-
ately with any and all other Certificates duly issued under
this Ordinance
(e) Authority for Issulna Replacement Certificates In
accordance with Section 6 of Vernon's Ann Tex civ St Art
717k~6, this Section of this Ordinance shall constitute author-
lty for the issuance of any such replacement certlflcate
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 certificates is hereby authorized and
imposed upon the Paying Agent/Registrar, and the Paying Agent/-
Registrar shall authenticate and deliver such Certificates in
the form and manner and with the effect, as provided in Section
6(d) of this Ordinance for Certificates issued in conversion
and exchange for other Certificates
Section 12 CUSTODY, APPROVAL, AND REGISTRATION OF
CERTIFICATES, CERTIFICATE COUNSEL'S OPINION, CUSIP NUMBERS,
PREAMBLE AND INSURANCE The Mayor of the Issuer is hereby
authorized to have control of the Initial Certificate issued
hereunder and all necessary records and proceedings pertaining
to the Initial Certificate pending its delivery and its inves-
tigation, 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 Certificate 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 Certificate, and the seal of said Comptroller
shall be impressed, or placed in facsimile, on the Initial
Certificate 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 Certificate or on any
Certificates issued and delivered in conversion of and exchange
or replacement of any Certificate, but neither shall have any
legal effect, and shall be solely for the convenience and
information of the registered owners of the Certificates The
preamble to this Ordinance is hereby adopted and made a part
hereof for all purposes If insurance is obtained on any of the
Certificates, the Initial Certificate and all other Certifi-
cates shall bear an appropriate legend concerning insurance as
provided by the insurer
Section 13 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 Certificates as obligations described 1n
section 103 of the Code, the interest on which is not lnclud-
27
able 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 Certificates (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 re-
ceived by the Issuer, with respect to such private busi-
ness use, do not, under the terms of this Ordinance or any
underlying arrangement, directly or indirectly, secure or
provide for the payment of more than 10 percent of the
debt service on the Certificates, 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
Certificates (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 Certificates (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 Certificates 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 Certificates being "federally guaranteed"
within the meaning of section 149(b) of the Code,
(f) to refrain from using any portion of the pro-
ceeds of the Certificates, 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 Certificates, other than
investment property acquired with --
28
(1) proceeds of the Certificates invested for a
reasonable temporary period of 3 years or less until
such proceeds are needed for the purpose for which
the Certificates 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 re-
quired reserve or replacement fund to the extent such
amounts do not exceed 10 percent of the proceeds of
the Certificates,
(g) to otherwise restrict the use of the proceeds of
the Certificates or amounts treated as proceeds of the
Certificates, as may be necessary, so that the Certifi-
cates 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 (relat-
ing 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 Certificates) 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 A~erica, not later that 60 days after
the Certificates have been paid in full, 100 percent of
the amount then required to be pa~d as a result of Excess
Earnings under section 148(f) of the Code, and
(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 slx years following the f~nal payment of princi-
pal and interest on the Certificates
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 Certifi-
cates, 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 Certificates under section
103 of the Code In the event that regulations or rulings are
hereafter promulgated which impose additional requirements
which are applicable to the Certificates, the Issuer agrees to
comply with the additional requirements to the extent neces-
sary, in the opinion of nationally-recognized bond counsel, to
preserve the exemption from federal income taxation of interest
on the Certificates under section 103 of the Code
Section 14 SALE OF INITIAL CERTIFICATE The Initial
Certificate is hereby sold and shall be delivered to
PaineWebber, Inc and Associates, for cash for the par value
thereof and accrued interest thereon to date of delIvery, plus
a premium of $ - 0 - It is hereby officially found, deter-
mined, and declared that the Initial Certificate has been sold
at public sale to the bidder offering the lowest interest cost,
after receiving sealed bids pursuant to an Official Notice of
Sale and Bidding Instructions and Official Statement dated
February 18, 1992, prepared and distributed in connection with
the sale of the Initial Certificate Said Official Notice of
Sale and Eidding Instructions and Official Statement, and any
addenda, supplement, or amendment thereto have been and are
hereby approved by the Issuer, and their use in the offer and
sale of the Certificates is hereby approved It is further
officially found, deter~ined, and declared that the statements
and representations contained in sa~d official Notice of Sale
and officlal Statement are true and correct in all material re-
spects, to the best knowledge and belief of the City Council
and the Issuer
Section 15 INTEREST EARNINGS ON CERTIFICATE PROCEEDS
Interest earnings derived from the investment of proceeds from
the sale of the Initial Certificate shall be used along with
other proceeds for the purposes for which the Certificates are
issued, provided that after completion of such purposes, if any
of such interest earnings remain on hand, such interest
earnings shall be deposited in the Interest and Sinking Fund
It is further provided, however, that any interest earnings on
certificate proceeds which are required to be rebated to the
United States of America pursuant to Section 13 hereof ~n order
to prevent the Certificates from being "arbitrage bonds" within
the meaning of the Code shall be so rebated and not considered
as interest earnings for the purposes of this Section
Section 16 DESIGNATION AS QUALIFIED TAX-EXEMPT
OBLIGATIONS The Issuer hereby designates the Certificates as
"qualified tax-exempt obligations" as defined in Section
26§(b)(3) of the Internal Revenue Code of 1986 (the "Code")
In furtherance of such designation, the Issuer represents,
covenants, and warrants the following (a) that during the
calendar year in which the Certificates are issued, the Issuer
(including any subordinate entitles) has not designated nor
30
will designate any bonds, certificates, or other obligations,
which when aggregated with the Certificates will result in more
than $10,000,000 of "qualified tax-exempt obligations" being
issued, (b) that the Issuer reasonably anticipates that the
amount of tax-exempt obligations issued during the calendar
year in which the Certificates are issued, by the Issuer (or
any subordinate entities) will not exceed $10,000,000, and, (c)
that the Issuer will take such action or refrain from such
action as necessary, and as more particularly set forth in
Section 13, hereof, in order that the Certificates will not be
considered "private activity bonds" within the meaning of
section 141 of the Code
Section 17 DTC REGISTRATION The Certificates Initially
shall be issued and delivered in such manner that no physical
distribution of the Certificates will be made to the public,
and the Depository Trust Company ("DTC"), New York, New York,
Initially will act as depository for the Certificates DTC has
represented that it is a limited purpose trust company incorpo-
rated 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 "clear-
lng agency" registered under Section 17A of the federal Securi-
ties Exchange Act of 1934, as amended, and the Issuer accepts,
but in no way verifies, such representations The Initial
Certificate authorized by this Ordinance shall be delivered to
and registered in the name of 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 In~tial Certif-
Icate and deliver in exchange therefor a substitute Certificate
for each maturity of such Initial Certificate, with each such
substitute Certificate 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 Certificates on behalf of the Purchaser and/or
the DTC Participants, as defined and described in the Official
Statement referred to and approved in Section 14 hereof (the
"DTC Participants") So long as each Certificate is registered
· n the name of CEDE & CO , the Paying 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 Certificates by DTC Participants in
integral amounts of $5,000, with transfers of ownership being
effected on the records of DTC and the DTC Participants pursu-
ant to rules and regulations established by them, and that the
substitute Certificates initially deposited with DTC shall be
immobilized and not be further exchanged for substitute Certif-
icates except as hereinafter provided The Issuer is not
31
responsible or liable for any functions of DTC, will not be
responsible for paying any fees or charges with respect to 1ts
services, will not be responsible or liable for maintaining,
supervising, or reviewing the records of DTC or the DTC Partic-
Ipants, Or protecting any interests or rights of the beneficial
owners of the Certificates 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 Certificates, 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 ~nltlal book-entry system
established with DTC will be maintained ~n the future The
Issuer reserves the right and option at any time in the future,
in 1ts sole discretion, to terminate the DTC (CEDE & CO )
book-entry only registration requirement described above, and
to permit the Certificates to be registered in the name of any
owner If the Issuer exercises its r~ght and option to termi-
nate 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 Certificate in any name as
provided for in th~s 0rd~nance Notwithstanding the initial
establishment of the foregoing book-entry system with DTC, if
for any reason any of the originally delivered substitute
Certificates is duly filed with the Paying Agent/Registrar with
proper request for transfer and subst~tutlon, as provided for
in this Ordinance, substitute Certificates will be duly deliv-
ered as provided in this Ordinance, and there wlll be no
assurance or representation that any book-entry system will be
maintained for such Certificates
Section 18 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 here~n
mentioned, as may be necessary or desirable in order to carry
out the terms and provisions of this Certificate Ordinance, the
Certificates, the sale of the Certificates, and the Notice of
Sale and Official Statement, and the Director of Finance of the
city shall cause the expenses of issuance of the Certificates
to be paid from the proceeds of sale of the Initial Certifi-
cate In case any officer whose signature shall appear on any
Cer~lficate shall cease to be such officer before the delivery
of such Certificate, such signature shall nevertheless be valid
and sufficient for all purposes the same as if such officer had
remained ~n office until such delivery
CERTIFICATE FOR
ORDINANCE AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF
CITY OF DENTON CERTIFICATES OF OBLIGATION, SERIES 1992,
AND APPROVING AND AUTHORIZING INSTRUMENTS AND PROCEDURES
~LATING THERETO
THE STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON
We, the undersigned officers of said City, hereby certify
as follows
i The City Council of said city convened in
REGULAR MEETING ON THE 3RD DAY OF MARCH, 1992,
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, City Secretary Bob Castleberry, Mayor
Mark Chew John Trent
Jane Hopkins Jim Alexander
Harold Perry Margaret Smith
and all of said persons were present, except the following
absentees Jane Hopkins ,
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 CERTIFICATES OF OBLIGATION, SERIES 1992,
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 Q
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 Certifi-
cate, 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 to the passage of
sald 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 there~n,
and that each of the officers and members of sa~d City Council
was duly and sufficiently notified off~clally 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 C~ty hereby
declare that their signing of this Certificate shall constitute
the signing of the attached and following copy of said Ordi-
nance for all purposes
SIGN~D AN~ ~E}L~D the 3rd day of March, 1992 .
(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 approved as to legality the
attached and following Ordinance prior to ~ts passage as
City Attorney
PAYING AGENT/REGISTRAR
AGREEMENT entered into as of March 24, 1992 (this "Agreement")
by and between city of Denton (the "Issuer"), and NatlonsBank of
Texas, N A , duly organized and existing under the laws of the
United States of America (the "Bank") at 1ts office located in Fort
Worth, Texas
RECITALS OF THE ISSUER
The Issuer has duly authorized and provided for the issuance
of Certificates of Obligation, Series 1992 (the "Securities") in an
aggregate principal amount of $1,325,000 to be Issued as registered
securities without coupons,
All things necessary to make the Securities the valid
obligations of the Issuer, in accordance with their terms, will be
taken upon the issuance and delivery thereof,
The Issuer is desirous that the Bank acts as the Paying Agent
of the Issuer in paying the principal, premium (~f any) and
interest on the Securities, in accordance with the terms thereof,
and that the Bank act as Registrar for the Securities,
The Issuer has duly authorized the execution and delivery of
this Agreement, and all things necessary to make this Agreement the
valid agreement of the Issuer, in accordance with its terms, have
been done
ARTICLE ONE
APPOINTMENT OF BANK AS
PAYING AGENT/REGISTRAR
section i 01 Appointment
The Issuer hereby appoints the Bank to act as Paying Agent
wlth respect to the Securities, in paying to the holders of the
Securities the principal, premium (if any) and interest on all or
any of the Securities
The Issuer hereby appoints the Bank as Registrar with respect
to the Securities
Section 1 02 Compensation
AS compensation for the Bank's services as Paying
Agent/Registrar, the Issuer hereby agrees to pay the Bank the fees
and amounts set forth in the Annex A hereto for the first year of
this Agreement and thereafter the fees and amounts set forth in the
Bank's current fee schedule then in effect for services as Paying
Agent/Registrar for municipalities, which shall be supplied to the
Issuer on or before 90 days prior to the close of the f~scal year
of the Issuer, and shall be effective upon the first day of the
following fiscal year
In addition, the Issuer agrees to reimburse the Bank upon
request for all reasonable expenses, disbursements and advances
incurred or made by the Bank in accordance with any of the
provisions hereof (including the reasonable compensation and the
expenses and disbursements of its agents and counsel)
ARTICLE TWO
DEFINITIONS
Section 2 01 Definitions
For all purposes of this Agreement, except as otherwise
expressly provided or unless the context otherwise requires
"Acceleration Date" on any security means the date on and
after which the principal or any or all installments of interest,
or both, are due and payable on any Security which as become
accelerated pursuant to the terms of the Security
"Bank Office" means the principal corporate trust office of
the Bank as indicated on Page 10 The Bank will notify the Issuer
in writing of any change in location of the Bank office
"Bond Resolution" means the resolution, order or ordinance of
the governing body of the Issuer pursuant to which the Securities
are issued certified by the Security or any other officer of the
Issuer and delivered to the Bank
"Fiscal Year" means the period ending September 30 of each
year
"Holder" and "Security Holder" each means a Person In whose
name a Security is registered in the Security Register
"Issuer Request" and "Issue Order" means a written request or
order signed in the name of the Issuer by the Chief Financial
Officer of the Issuer, and delivered to the Bank
"Legal Holiday" means a day on which the Bank is required or
authorized to be closed
"Person" means any individual, corporation, partnership, ]olnt
venture, association, joint stock company, trust, unincorporated
organization or government or any agency or political subdlvls~on
of a government
"Predecessor Securities" of any particular Security means
every previous Security evidencing all or a portion of the same
obligation as that evidenced by such particular Security (and, for
the purpose of this definition, any Security registered and
delivered under Section 5 06 in lieu of a mutilated, lost,
destroyed or stolen Security shall be deemed to evidence the same
obligation as the mutilated, lost, destroyed or stolen Security)
"Redemption Date" when used with respect to any Bond to be
redeemed means the date fixed for such redemption pursuant to the
terms of the Bond Resolution
"Responsible Officer" when used with respect to the bank means
the Chairman or Vice Chairman of the Board of Directors, the
Chairman or Vice Chairman of the Secretary, any Assistant
Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any
Assistant Cashier, any Trust Officer or Assistant Trust Officer, or
any other officer of the Bank customarily performing functions
similar to those performed by any of the above-designated officers
and means, with respect to a particular corporate trust matter, any
other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject
"Security Register" means a register maintained by the Bank on
behalf of the Issuer providing for the registration and transfer of
Securities
"Stated Maturity" means the date specified in the Bond
Resolution as the fixed date on which the principal of the Security
is due and payable
Section 2 02 Other Definitions
The terms "Bank," "Issuer" and "Security" have the meanings
assigned to them in the openlng paragraph of this Agreement or in
the Recitals of the Issuer
The term "Paying Agent/Registrar" refers to the Bank when it
is performing the functions associated with such terms 1n this
Agreement
ARTICLE THREE
PAYING AGENT
Section 3 01 Duties of Pavln~ AGent
As Paying Agent, the Bank shall, provided adequate collected
funds have been provided to it for such purpose by or on behalf of
the Issuer, pay on behalf of the Issuer the principal of the
Security at its Stated Maturity, Redemption Date, or Acceleration
Date, to the Holder upon surrender of the Security to the Bank at
the Bank Office
As Paying Agent, the Bank shall, provided adequate collected
funds have been provided to it for such purpose by or on behalf of
the Issuer, pay on behalf of the Issuer the interest on the
Security when due, by computing the amount of interest to be paid
each Holder, preparing the checks and mailing the checks on the
payment date, to the Holders of the Secur~tles (or their
Predecessor Securities) on the Record Date, addressed to their
address appearing on the Security Register
Section 3 02 Payment Dates
The Issuer hereby instructs the Bank to pay the principal of
and interest on the Securities at the dates specified in the order
authorizing issuance or bond resolution
ARTICLE FOUR
REGISTRAR
Section 4 01 Transfer and ExchanGe
The Bank agrees to keep and maintain for and on behalf of the
Issuer at the Bank office books and records (herein sometimes
referred to as the "Security Register") for recording the names and
addresses of the Holders of the Securities, the transfer, exchange,
and replacement of the Securities and the payment of the principal
of and interest on the Securities to the Holders and containing
such other information as may be reasonably required by the Issuer
and subject to such reasonable regulations as the Issuer and the
Bank may prescribe The Bank is hereby appointed "Registrar" for
the purpose of registering Securities and transfers of Securities
as herein provided The Bank agrees to maintain the Security
Register while it is Registrar Ail transfers, exchanges, and
replacements of Securities shall be noted in the Security Register
Every Security surrendered for transfer or exchange shall be
duly endorsed or be accompanied by a written instrument of
transfer, the signature on which has been guaranteed by an officer
of a federal or state bank or a member of the National Association
of Securities Dealers, such written Instrument to be in a form
satisfactory to the Bank, duly executed by the Holder thereof or
his attorney duly authorized in writing
Registrar may request any supporting documentation if he feels
necessary to effect a re-registration, transfer or exchange of the
Securities
Section 4 02 Certificates
The Issuer shall provide an adequate inventory of Securities
certificates to facilitate transfers The Bank covenants that it
will maintain Securities certificates in safekeeping and will use
reasonable care in maintaining such Securities in safekeeping,
which shall be not less than the care it maintains for debt
securities of other governments or corporations for which it serves
as registrar, or which it maintains for its own Securities
Section 4 03 Form of Security Re~lster
The Bank as Registrar will maintain the records of the
Security Register in accordance with the Bank's general practices
and procedures in effect from time to time The Bank shall not be
obligated to maintain such Register in any form other than those
which the Bank has currently available and currently utilizes at
the time
4
The Securities Register may be maintained in written form or
in any other form capable of being converted into written form
within a reasonable time
Section 4 04 List of Security Holders
The Bank will provide the Issuer at any time requested by the
Issuer, upon payment of the required fee, a copy of the informatlon
contained in the Security Register The Issuer may also inspect
the information in the Security Register at any time the Bank is
customarily open for business, provided that reasonable t~me is
allowed the Bank to provide an up-to-date listing or to convert the
information into written form
Except as otherwise required by law, the Bank will not release
or disclose the content of the Security Register to any person
other than to, or at the written request of, an authorized officer
or employee of the Issuer, except upon receipt of a subpoena or
court order Upon receipt of a subpoena or court order, the Bank
will notify the Issuer so that the Issuer may contest the subpoena
or court order
Section 4 05 Return of Cancelled Certificates
The Bank w~ll, at such reasonable intervals as it determines,
surrender to the Issuer, Securities certificates in lieu of which
or in exchange for which other Securlties have been issued, or
which have been paid
Section 4 06 Mutilated. Destroyed. Lost or Stolen Securities
The Issuer hereby instructs the Bank to deliver and issue
Securities in exchange for or in lieu of mutilated, destroyed, lost
or stolen Securities as long as the same does not result in an
overissuance
The Bank will issue and deliver a new Security in exchange for
a mutilated Security surrendered to it The Bank will issue a new
Security in lieu of a Security for which it received written
representation from the Holder that the Certificate representing
such Security is destroyed, lost or stolen, without the surrender
or production of the original Certificate The Bank will pay on
behalf of the Issuer the principal and premium, if any, of a
Security for which it receives written representation such Security
is destroyed, lost or stolen following the Stated Maturity or
Redemption of the Security, without the surrender or production of
the original Certificate
The Bank will not issue a replacement Security or pay such
replacement Security unless there is delivered to the Bank such
security or indemnity as it may require (which may be by the Bank's
blanke~ bond) to save both the Bank and the Issuer harmless
5
on satisfaction of the Bank and the Issuer, the Certificate
number on the Security registered will be cancelled with a notation
that it has been mutilated, destroyed, lost or stolen and a new
Security will be issued of the same series and of like tenor and
principal amount bearing a number (according to the Security
Register) not contemporaneously outstanding
The Bank may charge the Holder the Bank's fees and expenses in
connection with issuing a new Security in lieu of or exchange for
a mutilated, destroyed, lost or stolen Security
The Issuer hereby accepts the Bank's current blanket bond for
lost, stolen or destroyed Certificates and any future substitute
blanket bond for lost, stolen or destroyed Certificates that the
Bank may arrange, and agrees that the coverage under any such
blanket bond is acceptable to it and meets the Issuer's
requirements as to security or indemnity The Bank need not notify
the Issuer of any changes in the security or other company giving
such bond or the terms of any such bond The blanket bond then
utilized for the purpose of lost, stolen or destroyed Certificates
by the Bank is available for inspection by the Issuer on request
Section 4 07 Transaction Information to Issuer
The Bank will, within a reasonable time after receipt of
written request from the Issuer, furnish the Issuer information as
to the Securities it has paid pursuant to 3 01, Securities it has
delivered upon the transfer or exchange of any Securities pursuant
to Section 4 01 and Securities it has delivered in exchange for or
in lieu of mutilated, destroyed, lost or stolen Securities pursuant
to Section 4 06
ARTICLE FIVE
THE BANK
Section 5 01 Duties of Bank
The Bank undertakes to perform the duties set forth herein and
agrees to use reasonable care in the performance thereof
Section 5 02 Reliance on Documents. etc
(a) The Bank may conclusively rely, as to the truth of the
statements and correctness of the opinions expressed therein,
on certificates or opinions furnished to the Bank
(b) The Bank shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall
be proven that the Bank was negligent in ascertaining the
pertinent facts
6
(c) NO provisions of this Agreement shall require the Bank to
eMpend or risk its own funds or otherwise incur any financial
liability for performance of any of its duties hereunder, or
in the exercise of any of its rights or powers, if it shall
have reasonable grounds for believing that repayment of such
funds or adequate indemnity satisfactory to it against such
risks or liability is not assured to it
(d) The Bank may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, note, security, or other
paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties
Without limiting the generality of the foregoing statement,
the Bank need not examine the ownership of any Securities, but
is protected in acting upon receipt of Securities containing
an endorsement or instruction of transfer or power of transfer
which appears on its face to be signed by the Holder or an
attorney-in-fact of the Holder The Bank shall not be bound
to make any investigation into the facts or matters stated in
a resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
note, security or other paper or document supplied by Issuer
(e) The Bank may consult with counsel, and the written advice
of such counsel or any opinion of counsel shall be full and
complete authorization and protection with respect to any
action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon
(f) The Bank may exercise any of the powers hereunder and
perform any duties hereunder either directly or by or through
agents or attorneys and the Bank
Section 5 03 Recitals of Issuer
The recitals contained herein and in the Securities shall be
taken as the statements of the Issuer, and the Bank assumes no
responsibility for their correctness
The Bank shall in no event be liable to the Issuer, any Holder
or Holders of any Security or any other Person for any amount due
on any Security from its own funds
Section 5 04 May Hold Securities
The Bank, in 1ts Individual or any other capacity, may become
the owner of pledgee of Securities and may otherwise deal with the
Issuer with the same rights it would have if it were not the Paying
Agent/Registrar, or any other agent
7
Section § 05 Moneys Held bv Bank
Money held by the Bank hereunder need not be segregated from
any other funds provided appropriate accounts are maintained
The Bank shall be under no liability for interest on any money
received by it hereunder
The Bank shall deposit any moneys received from the Issuer
into a trust account to be held in a fiduciary capacity for the
payment of the Securities, with such moneys in the account that
exceed the deposit insurance available to the Issuer by the Federal
Deposit Insurance Corporation, to be fully collateralized with
securities or obligations that are eligible under the laws of the
State Of Texas to secure and be pledged as collateral for trust
accounts until the principal and interest on such securities have
been presented for payment and paid to the owner thereof Payments
made from such trust account shall be made by check drawn on such
trust account unless the owner of such Securities shall, at its own
expense and risk, request such other medium of payment
Subject to the Unclaimed Property Law of the State of Texas,
any money deposited with the Bank for the payment of the principal,
premium (if any), or interest on any Security and remaining
unclaimed for three years after the final maturity of the Security
has beoome due and payable will be paid by the Bank to the Issuer
if the Issuer so elects, and the Holder of such Security shall
hereafter look only to the Issuer for payment thereof, and all
l~abllity of the Bank with respect to such moneys shall thereupon
cease If the Issuer does not elect, the Bank is directed to
report and dispose of the funds in compliance with Title 6 of the
Texas Property Code, as amended
Any money deposited with the Bank for the payment of the
principal, premium (if any) or interest on any Security and
remaining unclaimed for four years after f~nal maturity of the
Security has become due and payable will be paid by the Bank to the
Issuer, and the Holder of such Security shall thereafter look only
to the Issuer for payment thereof, and all liability of the Bank
with respect to such moneys shall thereupon cease, provided that
the bank shall comply with Title 6, Tax Property Code, where
applicable
Section 5 06 Indemnification
The Issuer agrees to indemnify the Bank for and hold it
harmless against, any loss, liability or expense incurred without
negligpnce or bad faith on its part, arising out of or in
connection with its acceptance or admln~strat~on of its duties
hereunder' including the cost and expenses (including its counsel
fees) or defending itself against any claim or liability ~n
connection with the exercise or performance of any of its powers or
duties under this Agreement, provided that such indemnification
shall be to the extent permitted by law
8
section § 07 Interpleader
The Issuer and the Bank agree that the Bank may seek
adjudication of any adverse claim, demands or controversy over its
persons as well as funds on deposit, in either the District Court
of Tarrant County, Texas, or the United States Federal District
Court for the Northern District of Texas, waive personal service of
any process, and agree that service of process by certified or
registered mail, return receipt requested, to the address set forth
· n Section 6 03 of this Agreement shall constitute adequate
service The Issuer and the Bank further agree that the Eank has
the right to file a Bill of Interpleader in any court of competent
]urisd~ction to determine the rights of any Person claiming any
interest herein
ARTICLE SIX
MISCELLANEOUS PROVISIONS
Section 6 01 Amendment
This Agreement may be amended only by an agreement in writing
signed by both of the parties hereof
Section 6 02 Ass~anment
This Agreement may not be assigned by e~ther party w~thout the
prior written consent of the other
Section 6 03 Notices
Any request, demand, authorization, direction, notice,
consent, waiver or other document provided or permitted hereby to
be given or furnished to the Issuer or the Bank shall be ma~led or
delivered to the Issuer or the Bank, respectively, at the addresses
shown on Page 11
Section 6 04 Effect of Headln~s
The Article and Section headings herein are for convenience
only and shall not effect the construction hereof
Section 6 05 Successors and Assians
Ail covenants and agreements herein by the Issuer shall b~nd
· ts successors and assigns, whether so expressed or not
9
section 6 06 Separability
In case any provision herein shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired
thereby
Section 6 07 Benefits of Aoreement
Nothing herein, express or implied, shall give to any Person,
other khan the parties hereto and their successors hereunder, any
benefit or any legal or equitable right, remedy or claim hereunder
Section 6 08 Entire AGreement
This Agreement and the Bond Resolution constitute the entire
agreement between the parties hereto relative to the Bank acting as
Paying Agent/Registrar and if any conflict exists between this
Agreement and the Bond Resolution, the Bond Resolution shall
govern
section 6 09 Counterparts
This Agreement may be executed in any number of counterparts,
each which shall be deemed an original and all of which constitute
one and the same Agreement
Section 6 10 Termination
This Agreement will terminate on the date of final payment by
the Bank issuing its checks for the final payment of principal and
interest of the Securities
This Agreement may be earlier terminated upon 60 days written
notice by either party
The provisions of Section i 02 and Article Five shall survive
and remain in full force and effect following the termination of
this Agreement
Section 6 11 Governing Law
This Agreement shall be construed ~n accordance with and
governed by the laws of the State of Texas
10
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written
Issuer
~ ~xTeiC~lt~ve D, me~tom of F, uance
Address
215 E McKlnney
Mailing Address
Denton, lx 76201
City, State, Zip
Attn Executive Director of Finance
ATTEST
Paying Agent/Registrar
NationsBank of Texas, N A
Title Vice President
(SEAL)
Address 500 West 7th St , llth F1
Fort Worth, Texas 76113
~t 1~~/~/ Attn Corp Trust Dept
11
Nat~onsBank of Texas N A Tel $17 ~90 6%1
Corporate Trust #0497 11 Telefax 817 390 6968
500 West Seventh Street
Fort Worth TX 76102 4733
NaflonsBank
City of Denton, Texas
Certxfxcates of Oblxgat~on, Ser~es 1992
$1,325,000
Annual Fee (Book-Entry-Only) $200 00
Includes the following services
- ~aun~strat~on Fee
- Acceptance Fee
- Annual Renewal Fee
- Fee for Payment of Principal
- Fee for Payment of Interest
- Fee for Reducing Bonds
- ~rrespondence
- Other Paying ~ent/Reg~strar Special Services
Member FDIC