2005-135
ORDINANCE NO. 2005- / 3 ~
AN ORDINANCE
AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF CITY OF DENTON
GENERAL OBLIGATION BONDS, SERIES 2005, LEVYING THE TAX TO PAY SAME;
APPROVING AND AUTHORIZING INSTRUMENTS AND PROCEDURES RELATING
THERETO; AND PROVIDING AN EFFECTIVE DATE.
THE STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON
WHEREAS, an election was held on February 5, 2005 at which the City Council was authorized to
issue certain of the bonds hereinafter authorized; and
WHEREAS, at said election the following bonds were authorized to be issued:
Amount
Prop. Amount Amount Being Previously Voted
~ Authorized Issued Issued But Unissued
1 (SeIrior Center
& Library) $ 4,000,000 $ 200,000 $ -0- $ 3,800,000
2 (Streets) 27,700,000 4,445,600 -0- 23,254,400
3 (Parks) 10,700,000 354,400 -0- 10,345,600
WHEREAS, the bonds hereinafter authorized and designated were voted and are to be issued, sold,
and delivered pursuant to Chapter 133 I, Texas Government Code, and Article IX of the City's Home Rule
Charter, and other applicable laws; and .
WHEREAS, it is considered to be in the best interest of the City that said interest bearing bonds be
issued, NOW, THEREFORE
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
Section I. AMOUNT AND PURPOSE OF THE BONDS. The bond or bonds of the City of Denton,
Texas (the "Issuer") are hereby authorized to be issued and delivered in the aggregate principal amount of
$5,000,000, FOR THE PURPOSE OF THE ACQUISITION OF PROPERTY AND MAKING
IMPROVEMENTS FOR PUBLIC PURPOSES IN SAID CITY, TO-WIT: SENIOR CENTER AND
LIBRARY IMPROVEMENTS, STREET IMPROVEMENTS AND PARK IMPROVEMENTS.
Section 2. DESIGNATION OF THE BONDS. Each bond issued pursuant to this Ordinance shall
be designated: "CITY OF DENTON GENERAL OBLlGA TION BOND, SERIES 2005, and initially there
shall be issued, sold, and delivered hereunder a single fully registered bond, without interest coupons, payable
in installments of principal (the "Initial Bond"), but the Initial Bond may be assigned and transferred and/or
converted into and exchanged for a like aggregate principal amount of fully registered bonds, without interest
coupons, having serial maturities, and in the denomination or denominations of$5,000 or any integral multi-
ple of$5,000, all in the manner hereinafter provided. The term "Bonds" as used in this Ordinance shall mean
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and include collectively the Initial Bond and all substitute bonds exchanged therefor, as well as all other
substitute bonds and replacement bonds issued pursuant hereto, and the term "Bonds" shall mean any of the
Bonds.
Section 3. INITIAL DATE, DENOMINATION, NUMBER, MATURITIES, INITIAL
REGISTERED OWNER, AND CHARACTERISTICS OF THE INITIAL BOND.
(a) The Initial Bond is hereby authorized to be issued, sold, and delivered hereunder as a single fully
registered Bond, without interest coupons, dated May 15,2005, in the denomination and aggregate principal
amount of $5,000,000, numbered R-l, payable in annual installments of principal to the initial registered
owner thereof, to-wit:
RBC DAIN RAUSCHER INc., as representative
or to the registered assignee or assignees of said Bond or any portion or portions thereof (in each case, the
"registered owner"), with the annual installments of principal of the Initial Bond to be payable on the dates,
respectively, and in the principal amounts, respectively, stated in the FORM OF INITIAL BOND set forth
in this Ordinance.
(b) The Initial Bond (i) may be prepaid or redeemed prior to the respective scheduled due dates of
installments of principal thereof, (it) may be assigned and transferred, (iit) may be converted and exchanged
for other Bonds, (iv) shall have the characteristics, and (v) shall be signed and sealed, and the principal of and
interest on the Initial Bond shall be payable, all as provided, and in the manner required or indicated, in the
FORM OF INITIAL BOND set forth in this Ordinance.
Section 4. INTEREST. The unpaid principal balance of the Initial Bond shall bear interest from the
date of the Initial Bond to the respective scheduled due dates, or to the respective dates of prepayment or
redemption, of the installments of principal of the Initial Bond, and said interest shall be payable, all in the
manner provided and at the rates and on the dates stated in the FORM OF INITIAL BOND set forth in this
Ordinance.
Section 5. FORM OF INITIAL BOND. The form of the Initial Bond, including the form of
Registration Certificate of the Comptroller of Public Accounts of the State of Texas to be endorsed on the
Initial Bond, shall be substantially as follows:
FORM OF INITIAL BOND
NO.R-l
$5,000,000
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON GENERAL OBLIGATION BOND
SERIES 2005
THE CITY OF DENTON, in Denton County, Texas (the "Issuer"), being a political subdivision of
the State of Texas, hereby promises to pay to
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or to the registered assignee or assignees of this Bond or any portion or portions hereof (in each case, the
"registered owner") the aggregate principal amount of
$5,000,000
(FIVE MILLION DOLLARS)
in annual installments of principal due and payable on February 15 in each of the years, and in the respective
principal amounts, as set forth in the following schedule, and to pay interest, from the date of this Bond
hereinafter stated, on the balance of each such installment of principal, respectively, from time to time
remaining unpaid, at the rates per annum as follows:
PRINCIPAL INTEREST PRINCIPAL INTEREST
YEAR AMOUNT RATE(%) YEAR AMOUNT RATE(%)
2006 $ 105,000 3.000 2016 $255,000 4.000
2007 165,000 3.250 2017 265,000 4.000
2008 t 70,000 5000 2018 275,000 4.000
2009 180,000 5.000 2019 285,000 4.000
2010 190.000 5.000 2020 300,000 4.125
20 It 200,000 5.000 2021 310,000 4.250
20t2 210,000 5.000 2022 325,000 4.250
2013 220,000 5.000 2023 340,000 4.250
20t4 235,000 5.000 2024 355,000 4.375
2015 245.000 4.375 2025 370,000 4.375
Interest shall first be due and payable on February 15,2006, and semiannually on each February 15
and August 15 thereafter while this Bond or any portion hereof is outstanding and unpaid. Said interest shall
be calculated on the basis of a 360-day year composed of tWelve 30-day months.
THE INSTALLMENTS OF PRlNCIP AL OF AND THE INTEREST ON this Bond are payable in
lawful money of the United States of America, without exchange or collection charges. The installments of
principal and the interest on this Bond are payable to the registered owner hereof tluough the services of
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, DALLAS, TEXAS, which is the "Paying
Agent/Registrar" for this Bond. Payment of all principal of and interest on this Bond shall be made by the
Paying AgentlRegistrar to the registered owner hereof on each principal and/or interest payment date by
check, dated as of such date, drawn by the Paying AgentlRegistrar on, and payable solely from, funds of the
Issuer required by the ordinance authorizing the issuance of this Bond (the "Bond Ordinance") to be on
deposit with the Paying Agent/Registrar for such purpose as hereinafter provided; and such check shall be
sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, on each such principal
and/or interest payment date, to the registered owner hereof, at the address of the registered owner, as it
appeared at the close of business on the last day of the month next preceding each such date (the "Record
Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described. The Issuer
covenants with the registered owner of this Bond that on or before each principal and/or interest payment date
for this Bond it will make available to the Paying Agent/Registrar, from the "Interest and Sinking Fund"
created by the Bond Ordinance, the amounts required to provide for the payment. in immediately available
funds, of illl principal of and interest on this Bond. when due.
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IN THE EVENT of a nonpayment of interest on a scheduled payment date, and for thirty (30) days
thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the
Paying AgentlRegistrar, if and when funds for the payment of such interest have been received from the
Issuer. Notice of the Special Record Date and of the scheduled payment date of the past due interest ("Special
Payment Date", which shall be fifteen (15) days after the Special Record Date) shall be sent at least five (5)
business days prior to the Special Record Date by United States mail, first class postage prepaid, to the
address of each Holder of a Bond appearing on the registration books of the Paying AgentlRegistrar at the
close of business on the t 5th business day next preceding the date of mailing of such notice.
IF THE DATE for the payment of the principal of or interest on this Bond shall be a Saturday,
Sunday, a legal holiday, or a day on which banking institutions in the City where the Paying AgentlRegistrar
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 arc
authorized to close; and payment on such date shall have the same force and elTect as if made on the original
date payment was due.
THIS BOND has been authorized in accordance with the Constitution and laws of the State of Texas
FOR THE PURPOSE OF THE ACQUISITION OF PROPERTY AND MAKING IMPROVEMENTS FOR
PUBLIC PURPOSES IN SAID CITY, TO-WIT: SENIOR CENTER AND LIBRARY IMPROVEMENTS,
STREET IMPROVEMENTS AND PARK IMPROVEMENTS
ON FEBRUARY 15,2015, or on any date whatsoever thereafter, the unpaid installments of principal
of this Bond may be prepaid or redeemed prior to their scheduled due dates, at the option of the Issuer, with
funds derived from any available source, as a whole, or in part, and, if in part, the particular portion of this
Bond to be prepaid or redeemed shall be selected and designated by the Issuer (provided that a portion oflhis
Bond may be redeemed only in an integral multiple of$5,000), at the prepayment or redemption price of the
par or principal amount thereof, plus accrued interest to the date fixed for prepayment or redemption.
AT LEAST 30 days prior to the date fixed for any such prepayment or redemption a written notice
of such prepayment or redemption shall be mailed by the Paying AgentlRegistrar 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
Bond or the portion hereof which is to be so prepaid or redeemed, plus accrued interest thereon to the date
fixed for prepayment or redemption. If such written notice of prepayment or redemption is given, and if due
provision for such payment is made, all as provided above, this Bond, or the portion thereof which is to be
so prepaid or redeemed, thereby automatically shall be treated as prepaid or redeemed prior to its scheduled
due date, and shall not bear interest after the date fixed for its prepayment or redemption, and shall not be
regarded as being outstanding except for the right of the registered owner to receive the prepayment or
redemption price plus accrued interest to the date fixed for prepayment or redemption from the Paying
Agent/Registrar out of the funds provided for such payment. The Paying Agent/Registrar shall record in the
Registration Books all such prepayments or redemptions of principal of this Bond or any portion hereof.
THIS BOND, to the extent of the unpaid or unredeemed principal balance hereof, or any unpaid and
unredeemed portion hereofin any integral multiple of$5,000, may be assigned by the initial registered owner
hereof and shall be transferred only in the Registration Books of the Issuer kept by the Paying
Agent/Registrar acting in the capacity of registrar for the Bonds, upon the terms and conditions set forth in
the Bond Ordinance. Among other requirements for such transfer, this Bond must be presented and
surrendered to the Paying Agent/Registrar for cancellation, together with proper instruments of assignment,
in form and with guarantee of signatures satisfactory to the Paying AgentlRegistrar, evidencing assignment
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by me initial registered owner of mis Bond, or any portion or portions hereof in any integral multiple of
$5,000, to me assignee or assignees in whose name or names mis Bond or any such portion or portions hereof
is or are to be transferred and registered. Any instrument or instruments of assignment satisfactory to me
Paying Agent/Registrar may be used to evidence me assignment ofmis Bond or any such portion or portions
hereof by me initial registered owner hereof. A new bond or bonds payable to such assignee or assignees
(which then will be me new registered owner or owners of such new Bond or Bonds) or to the initial
registered owner as to any portion of mis Bond which is not being assigned and transferred by me initial
registered owner, shall be delivered by me Paying Agent/Registrar in conversion of and exchange for mis
Bond or any portion or portions hereof, but solely in me fonn and manner as provided in me next paragraph
hereoffor me conversion and exchange ofmis Bond or any portion hereof. The registered owner ofmis Bond
shall be deemed and treated by me Issuer and me Paying Agent/Registrar as me absolute owner hereof for
all purposes, including payment and discharge of liability upon mis Bond to me extent of such payment, and
me Issuer and the Paying Agent/Registrar shall not be affected by any notice to me contrary.
AS PROVIDED above and in me Bond Ordinance, mis Bond, to me extent of me unpaid or
umedeemed principal balance hereof, may be converted into and exchanged for a like aggregate principal
amount of fully registered bonds, without interest coupons, payable to me assignee or assignees duly
designated in writing by the initial registered owner hereof, or to me initial registered owner as to any portion
ofmis Bond which is not being assigned and transferred by me initial registered owner, in any denomination
or denominations in any integral multiple of $5,000 (subject to the requirement hereinafter stated mat each
substitute bond issued in exchange for any portion ofmis Bond shall have a single stated principal maturity
date), upon surrender ofmis Bond to me Paying Agent/Registrar for cancellation, all in accordance willi me
fonn and procedures set forth in me Bond Ordinance. If this Bond or any portion hereof is assigned and
transferred or converted each bond issued in exchange for any portion hereof shall have a single stated
principal maturity date corresponding to me due date of me installment of principal of this Bond or portion
hereof for which me substitute bond is being exchanged, and shall bear interest at me rate applicable to and
borne by such installment of principal or portion thereof. Such bonds, respectively, shall be subject to
redemption prior to maturity on the same dates and for the same prices as the corresponding installment of
principal ofmis Bond or portion hereoffor which mey are being exchanged. No such bond shall be payable
in installments, but shall have only one stated principal maturity date. AS PROVIDED IN THE BOND
ORDINANCE, THIS BOND IN ITS PRESENT FORM MAY BE ASSIGNED AND TRANSFERRED OR
CONVERTED ONCE ONLY, and to one or more assignees, but me bonds issued and delivered in exchange
formis Bond or any portion hereof may be assigned and transferred, and converted, subsequently, as provided
in me Bond Ordinance. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and
charges for transferring, converting, and exchanging mis Bond or any portion thereof, but the one requesting
such transfer, conversion, and exchange shall pay any taxes or governmental charges required to be paid willi
respect mereto. The Paying Agent/Registrar shall not be required to make any such assignment, conversion,
or exchange (i) during me period commencing willi me close of business on any Record Date and ending willi
the opening of business on the next following principal or interest payment date, or, (ii) willi respect to any
Bond or portion thereof called for prepayment or redemption prior to maturity, wimin 45 days prior to its
prepayment or redemption date.
IN THE EVENT any Paying Agent/Registrar for this Bond is changed by the Issuer, resigns, or
otherwise ceases to act as such, the Issuer has covenanted in me Bond Ordinance mat 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 ofmis Bond.
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IT IS HEREBY certified, recited, and covenanted that this Bond has been duly and validly voted,
authorized, issued, sold, and delivered; that all acts, conditions, and things required or proper to be performed.
exist, and be done precedent to or in the authorization, issuance, and delivery of this Bond have been
performed, existed, and been done in accordance with law; that this Bond is a general obligation of the Issuer,
issued on the full faith and credit thereof; and that annual ad valorem taxes sufficient to provide for the
payment of the interest on and principal of this Bond, as such interest comes due and such principal matures,
have been levied and ordered to be levied against all taxabte property in the Issuer, and have been pledged
irrevocably for such payment, within the limit prescribed by law.
BY BECOMING the registered owner of this Bond, the registered owner thereby acknowledges all
of the terms and provisions of the Bond Ordinance, agrees to be bound by such terms and provisions,
acknowledges that the Bond Ordinance is duly recorded and available for inspection in the official minutes
and records of the governing body of the Issuer, and agrees that the terms and provisions of this Bond and
the Bond Ordinance constitute a contract between the registered owner hereof and the Issuer.
IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or facsimile
signature of the Mayor of the Issuer and countersigned and attested with the manual or facsimile signature
of the City Secretary of the Issuer, has caused the official seal of the Issuer to be duly impressed, or placed
in facsimile, on this Bond and has caused this Bond to be dated May IS, 200S,
ATTEST:
CITY OF DENTON, TEXAS
By:
Euline Brock
Mayor, City of Denton, Texas
By:
Jennifer Walters
City Secretary, City of Denton, Texas
(CITY SEAL)
(INSERT BOND INSURANCE LEGEND, IF ANY)
FORM OF REGISTRATION CERTIFICATE OF THE
COMPTROLLER OF PUBLIC ACCOUNTS:
(To be attached to Initial Bond only)
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO.
I hereby certifY that this Bond has been examined, certified as to validity, and approved by the
Attorney General of the State of Texas, and that this Bond has been registered by the Comptroller of Public
Accounts of the State of Texas.
Witness my signature and seal this
Comptroller of Public Accounts
of the State of Texas
(COMPTROLLER'S SEAL)
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Section 6. ADDITIONAL CHARACTERISTICS OF THE BONDS (a) Registration and Transfer
The Issuer shall keep or cause to be kept at the principal corporate trust office of JPMORGAN CHASE
BANK, NATIONAL ASSOCIATION, DALLAS, TEXAS (the "Paying AgentlRegistrar") books or records
of the registration and transfer of the Bonds (the "Registration Books"), and the Issuer hereby appoints the
Paying Agent/Registrar as its registrar and transfer agent to keep such books or records and make such
transfers and registrations under such reasonable regulations as the Issuer and Paying AgentlRegistrar may
prescribe; and the Paying AgentlRegistrar shall make such transfers and registrations as herein provided. The
Paying AgentlRegistrar shall obtain and record in the Registration Books the address of the registered owner
of each Bond to which payments with respect to the Bonds shall be mailed, as herein provided; but it shall
be the duty of each registered owner to notifY the Paying Agent/Registrar in writing of the address to which
payments shall be mailed, and such interest payments shall not be mailed unless such notice has been given.
The Issuer shall have the right to inspect the Registration Books during regular business hours of the Paying
Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books confidential and,
unless otherwise required by law, shall not pennit their inspection by any other entity. Registration of each
Bond may be transferred in the Registration Books only upon presentation and surrender of such Bond to the
Paying Agent/Registrar for transfer of registration and cancellation, together with proper written instrwnents
of assignment, in fonn and with guarantee of signatures satisfactory to the Paying AgentlRegistrar, (i)
evidencing the assignment of the Bond, or any portion thereof in any integral multiple of $5,000, to the
assignee or assignees thereof, and (ii) the right of such assignee or assignees to have the Bond or any such
portion thereof registered in the name of such assignee or assignees. Upon the assignment and transfer of
any Bond or any portion thereof, a new substitute Bond or Bonds shall be issued in conversion and exchange
therefor in the manner herein provided. The Initial Bond, to the extent of the unpaid or Wlredeemed principal
balance thereof, may be assigned and transferred by the initial registered owner thereof once only, and to one
or more assignees designated in writing by the initial registered owner thereof All Bonds issued and de-
livered in conversion of and exchange for the Initial Bond shall be in any denomination or denominations of
any integral multiple of$5,OOO (subject to the requirement hereinafter stated that each substitute Bond shall
have a single stated principal maturity date), shall be in the fonn prescribed in the FORM OF SUBSTITUTE
BOND set forth in this Ordinance, and shall have the characteristics, and may be assigned, transferred, and
converted as hereinafter provided. If the Initial Bond or any portion thereof is assigned and transferred or
converted the Initial Bond must be surrendered to the Paying Agent/Registrar for cancellation, and each Bond
issued in exchange for any portion of the Initial Bond shall have a single stated principal maturity date, and
shall not be payable in installments; and each such Bond shall have a principal maturity date corresponding
to the due date of the installment of principal or portion thereof for which the substitute Bond is being ex-
changed; and each such Bond shall bear interest at the single rate applicable to and borne by such installment
of principal or portion thereof for which it is being exchanged. If only a portion of the Initial Bond is
assigned and transferred, there shall be delivered to and registered in the name of the initial registered owner
substitute Bonds in exchange for the unassigned balance of the Initial Bond in the same manner as if the
initial registered owner were the assignee thereof If any Bond or portion thereof other than the Initial Bond
is assigned and transferred or converted each Bond issued in exchange therefor shall have the same principal
maturity date and bear interest at the same rate as the Bond for which it is exchanged. A fonn of assignment
shall be printed or endorsed on each Bond, excepting the Initial Bond, which shall be executed by the
registered owner or its duly authorized attorney or representative to evidence an assignment thereof. Upon
surrender of any Bonds or any portion or portions thereof for transfer of registration, an authorized
representative of the Paying Agent/Registrar shall make such transfer in the Registration Books, and shall
deliver a new fully registered substitute Bond or Bonds, having the characteristics herein described, payable
to such assignee or assignees (which then will be the registered owner or owners of such new Bond or
Bonds), or to the previous registered owner in case only a portion ofa Bond is being assigned and transferred,
all in conversion of and exchange for said assigned Bond or Bonds or any portion or portions thereof, in the
same fonn and manner, and with the same effect, as provided in Section 6(d), below, for the conversion and
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exchange of Bonds by any registered owner of a Bond. The Issuer shall pay the Paying Agent/Registrar's
standard or customary fees and charges for making such transfer and delivery of a substitute Bond or Bonds,
but the one requesting such transfer shall pay any taxes or other governmental charges required to be paid
with respect thereto. The Paying Agent/Registrar shall not be required to make transfers of registration of
any Bond or any portion thereof(i) during the period commencing with the close of business on any Record
Date and ending with the opening of business on the next following principal or interest payment date, or,
(ii) with respect to any Bond or any portion thereof called for redemption prior to maturity, within 45 days
prior to its redemption date.
(b) Ownershie of Bonds. The entity in whose name any Bond shall be registered in the Registration
Books at any time shall be deemed and treated as the absolute owner thereof for all purposes of this
Ordinance, whether or not such Bond shall be overdue, and the Issuer and the Paying Agent/Registrar shall
not be affected by any notice to the contrary; and payment of, or on account of, the principal of, premium,
if any, and interest on any such Bond shall be made only to such registered owner. All such payments shall
be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums
so paid.
(c) Pavment of Bonds and Interest. The Issuer hereby further appoints the Paying Agent/Registrar
to act as the paying agent for paying the principal of and interest on the Bonds, and to act as its agent to
convert and exchange or replace Bonds, all as provided in this Ordinance. The Paying Agent/Registrar shall
keep proper records of all payments made by the Issuer and the Paying Agent/Registrar with respect to the
Bonds, and of all conversions and exchanges of Bonds, and all replacements of Bonds, as provided in this
Ordinance. However, in the event of a nonpayment of interest on a scheduled payment date, and for thirty
(30) days thereafter, anew record date for such interest payment (a "Special Record Date") will be established
by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received from
the Issuer. Notice of the Special Record Date and of the scheduled payment date of the past due interest
("Special Payment Date", which shall be fifteen (15) days after the Special Record Date) shall be sent at least
five (5) business days prior to the Special Record Date by United States mail, first class postage prepaid, to
the address of each Holder of a Bond appearing on the registration books of the Paying Agent/Registrar at
the close of business on the 15th business day next preceding the date of mailing of such notice.
(d) Conversion and Exchange or Reelacement" Authentication. Each Bond issucd and delivcred
pursuant to this Ordinance, to the extent of the unpaid or unredeemed principal balance or principal amount
thereof, may, upon surrender of such Bond at the principal corporate trust office of the Paying
Agent/Registrar, together with a written request therefor duly executed by the rcgistered owner or thc
assignee or assignees thereof, or its or their duly authorized attorneys or representatives, with guarantee of
signatures satisfactory to the Paying Agent/Registrar, may, at the option of the registered owner or such
assignee or assignees, as appropriate, be converted into and exchanged for fully registered bonds, without
interest coupons, in the form prescribcd in the FORM OF SUBSTITUTE BOND set forth in this Ordinance,
in the denomination of $5,000, or any integral multiple of $5,000 (subject to thc requiremcnt hereinaftcr
stated that each substitute Bond shall have a single stated maturity date), as requested in writing by such
registered owner or such assignee or assignees, in an aggregate principal amount equal to the unpaid or unre-
deemed principal balance or principal amount of any Bond or Bonds so surrendered, and payable to the
appropriate registered owner, assignee, or assignees, as the case may be. If the Initial Bond is assigned and
transferred or converted each substitute Bond issued in exchange for any portion of the Initial Bond shall have
a single stated principal maturity datc, and shall not be payable in installments; and each such Bond shall have
a principal maturity date corresponding to the due date of the installment of principal or portion thereoffor
which the substitute Bond is being exchanged; and each such Bond shall bear interest at the single rate
applicable to and borne by such installment of principal or portion thereof for which it is bcing exchanged.
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If a portion of any Bond (other than the Initial Bond) shall be redeemed prior to its scheduled maturity as
provided herein, a substitute Bond or Bonds having the same maturity date, bearing interest at the same rate,
in the denomination or denominations of any integral multiple of $5,000 at the request of the registered
owner, and in aggregate principal amount equal to the unredeemed portion thereof, will be issued to the
registered owner upon surrender thereoffor cancellation. If any Bond or portion thereof(otherthan the Initial
Bond) is assigned and transferred or converted, each Bond issued in exchange therefor shall have the same
principal maturity date and bear interest at the same rate as the Bond for which it is being exchanged. Each
substitute Bond shall bear a letter and/or number to distinguish it from each other Bond. The Paying
AgentlRegistrar shall convert and exchange or replace Bonds as provided herein, and each fully registered
bond delivered in conversion of and exchange for or replacement of any Bond or portion thereof as permitted
or required by any provision of this Ordinance shall constitute one of the Bonds for all purposes of this
Ordinance, and may again be converted and exchanged or replaced. It is specifically provided that any Bond
authenticated in conversion of and exchange for or replacement of another Bond on or prior to the first
scheduled Record Date for the Initial Bond shall bear interest from the date of the Initial Bond, but each
substitute Bond so authenticated after such first scheduled Record Date shall bear interest from the interest
payment date next preceding the date on which such substitute Bond was so authenticated, unless such Bond
is authenticated after any Record Date but on or before the next following interest payment date, in which
case it shall bear interest from such next following interest payment date; provided, however, that if at the
time of delivery of any substitute Bond the interest on the Bond for which it is being exchanged is due but
has not been paid, then such Bond shall bear interest from the date to which such interest has been paid in
full. THE INITIAL BOND issued and delivered pursuant to this Ordinance is not required to be, and shall
not be, authenticated by the Paying AgentlRegistrar, but on each substitute Bond issued in conversion of and
exchange for or replacement of any Bond or Bonds issued under this Ordinance there shall be printed a bond,
in the form substantially as follows:
"PAYING AGENTIREGlSTRAR'S AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been issued under the provisions of the Bond Ordinance
described in this Bond; and that this Bond has been issued in conversion of and exchange for or replacement
of a bond, bonds, or a portion of a bond or bonds of an issue which originally was approved by the Attorney
General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas.
JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION, DALLAS, TEXAS,
Paying AgentlRegistrar
Dated
By
Authorized Representative"
An authorized representative of the Paying AgentIRegistrar shall, before the delivery of any such Bond, date
and manually sign the above Bond, and no such Bond shall be deemed to be issued or outstanding unless such
Bond is so executed. The Paying Agent/Registrar promptly shall cancel all Bonds surrendered for conversion
and exchange or replacement. No additional ordinances, orders, or resotutions need be passed or adopted by
the governing body of the Issuer or any other body or person so as to accomplish the foregoing conversion
and exchange or replacement of any Bond or portion thereof, and the Paying Agent/Registrar shall provide
for the printing, execution, and delivery of the substitute Bonds in the manner prescribed herein, and said
Bonds shall be of type composition printed on paper with lithographed or steel engraved borders of customary
weight and strength. Pursuant to Chapter 1201, Texas Government Code, the duty of conversion and
BRtl: 0705.066\5-23-2005-GO-Ordinance
9
exchange or replacement of Bonds as aforesaid is hereby imposed upon the Paying AgcntlRegistrar, and.
upon the execution of the above Paying Agent/Registrar's Authentication CertifIcate, the converted and
exchanged or replaced Bond shall be valid, incontestable, and enforceable in the same manner and with the
same effect as the Initial Bond which originally was issued pursuant to this Ordinance, approved by the
Attorney General, and registered by the Comptroller of Public Accounts. The Issuer shall pay the Paying
AgentlRegistrar's standard or customary fees and charges for transferring, converting, and exchanging any
Bond or any portion thereof, but the one requesting any such transfer, eonversion, and exchange shall pay
any taxes or governmental charges required to be paid with respect thereto as a condition precedent to the
exercise of such privilege of conversion and exchange. The Paying Agent/Registrar shall not be required to
make any such conversion and exchange or replacement of Bonds or any portion thereof (i) during the period
commencing with the close of business on any Record Date and ending with the opening of business on the
next following principal or interest payment date, or, (ii) with respect to any Bond or portion thereof called
for redemption prior to maturity, within 45 days prior to its redemption date.
(e) In General. All Bonds issued in conversion and exchange or replacement of any other Bond or
portion thereof, (i) shall be issued in fully registered form, without interest coupons, with the principal of and
interest on such Bonds to be payable only to the registered owners thereof, (ii) may be redeemed prior to their
scheduled maturities, (iii) may be transfeITed and assigned, (iv) may be converted and exchanged for other
Bonds, (v) shall have the characteristics, (vi) shall be signed and sealed, and (vii) the principal of and interest
on the Bonds shall be payable, all as provided, and in the manner required or indicated, in the FORM OF
SUBSTITUTE BOND set forth in this Ordinance
(f) Pavment of Fees and Charges. The Issuer hereby covenants with the registered owners of the
Bonds that it will (i) pay the standard or customary fees and charges of the Paying Agent/Registrar for its
services with respect to the payment of the principal of and interest on the Bonds, when due, and (ii) pay the
fees and charges of the Paying Agent/Registrar for services with respect to the transfer of registration of
Bonds, and with respect to the conversion and exchange of Bonds solely to the extent above provided in this
Ordinance.
(g) Substitute Paving Agent/Registrar. The Issuer covenants with the registered owners of the Bonds
that at all times while the Bonds are outstanding the Issuer will provide a competent and legally qualifIed
bank, trust company, [mancial institution, or other agency to act as and perform the services of Paying
Agent/Registrar for the Bonds under this Ordinance, and that the Paying Agent/Registrar will be one entity.
The Issuer reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less than
120 days written notice to the Paying Agent/Registrar, to be effective not later than 60 days prior to the next
principal or interest payment date after such notiee. 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 it will promptly 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 shall promptly transfer and
deliver the Registration Books (or a copy thereof), along with all other pertinent books and records relating
to the Bonds, to the new Paying Agent/Registrar designated and appointed by the Issuer. Upon any change
in the Paying Agent/Registrar, the Issuer promptly will cause a written notice thereof to be sent by the new
Paying Agent/Registrar to each registered owner of the Bonds, by United States mail, fIrst-class postage
prepaid, which notice also shall give the address of the new Paying Agent/Registrar. By accepting the
position and performing as such, each Paying Agent/Registrar shall be deemed to have agreed to the provi-
sions of this Ordinance, and a cenifted copy of this Ordinance shall be delivered to each Paying
Agent/Registrar.
BRIZ: 0705.066\5-23-2005-GO-O,dinance
10
Section 7. FORM OF SUBSTITUTE BONDS. The form of all Bonds issued in conversion and
exchange or replacement of any other Bond or portion thereof, including the form of Paying Agent/Registrar's
Bond to be printed on each of such Bonds, and the Form of Assignment to be printed on each of the Bonds,
shall be, respectively, substantially as follows, with such appropriate variations, omissions, or insertions as
are permitted or required by this Ordinance.
FORM OF SUBSTITUTE BOND
(Book-Entry Only Legend, if appropriate)
NO.-
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF DENTON
CITY OF DENTON GENERAL OBLIGATION BOND
SERIES 2005
PRINCIPAL AMOUNT
$
DATED DATE
CUSIP NO.
INTEREST RATE
MATURITY DATE
_%
-
ON THE MATURITY DATE specified above the CITY OF DENTON, in Denton County, Texas
(the "Issuer"), being a political subdivision of the State of Texas, hereby promises to pay to
, or to the registered assignee
hereof (either being hereinafter called the "registered owner") the principal amount of
and to pay interest thereon, calculated on the basis of a 360-day year composed of twelve 30-day months,
from May 15,2005, to the maturity date specified above, or the date of redemption prior to maturity, at the
interest rate per annum specified above; with interest being first due and payable on February 15,2006, and
semiannually on each August 15 and February 15 thereafter, except that if the date of authentication of this
Bond is later than the first Record Date (hereinafter defmed), such principal amount shall bear interest from
the interest payment date next preceding the date of authentication, unless such date of authentication is after
any Record Date (hereinafter defined) but on or before the next following interest payment date, in which
case such principal amount shall bear interest from such next following interest payment date.
THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the United
States of America, without exchange or collection charges. The principal of this Bond shall be paid to the
registered owner hereof upon presentation and surrender of this Bond at maturity or upon the date fixed for
its redemption prior to maturity, at the principal corporate trust office of JPMORGAN CHASE BANK,
NATIONAL ASSOCIATION, DALLAS, TEXAS, which is the "Paying Agent/Registrar" for this Bond. The
payment of interest on this Bond shall be made by the Paying Agent/Registrar to the registered owner hereof
on each interest payment date by check, dated as of such interest payment date, drawn by the Paying
Agent/Registrar on, and payable solely from, funds of the Issuer required by the ordinance authorizing the
issuance of the Bonds (the "Bond Ordinance") to be on deposit with the Paying Agent/Registrar for such
purpose as hereinafter provided; and such check shall be sent by the Paying Agent/Registrar by United States
mail, flfst-class postage prepaid, on each such interest payment date, to the registered owner hereof, at the
address of the registered owner, as it appeared at the close of business on the last day of the month next
BRIZ: 070S.066\5-23-2005-GO-Ordinance
II
preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar.
as hereinafter described. However, the payment of such interest may be made by any other method
acceptable to the Paying Agent/Registrar and requested by, and at the risk and expense of, the registered
owner hereof Any accrued interest due upon the redemption of this Bond prior to maturity as provided
herein shall be paid to the registered owner at the principal corporate trust office of the Paying Agent/Regis-
trar upon presentation and surrender of this Bond for redemption and payment at the principal corporate trust
office of the Paying Agent/Registrar. The Issuer covenants with the registered owner of this Bond that on
or before each principal payment date, interest payment date, and accrued interest payment date for this Bond
it will make available to the Paying Agent/ Registrar, from the "Interest and Sinking Fund" created by the
Bond Ordinance, the amounts required to provide for the payment, in immediately available funds, of all
principal of and interest on the Bonds, when due.
IN THE EVENT ofa nonpayment of interest on a scheduled payment date, and for thirty (30) days
thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the
Paying Agent/Registrar, if and when funds for the payment of such interest have been received from the
Issuer. Notice ofthe Special Record Date and of the scheduled payment date of the past due interest ("Special
Payment Date", which shall be fifteen (IS) days after the Special Record Date) shall be sent at least five (5)
business days prior to the Special Record Date by United States mail, first class postage prepaid, to the
address of each Holder of a Bond appearing on the registration books of the Paying Agent/Registrar at the
close of business on the 15th business day next preceding the date of mailing of such notice.
IF THE DATE for the payment of the principal of or interest on this Bond shall be a Saturday,
Sunday, a legal holiday, or a day on which banking institutions in the City where the Paying Agent/Registrar
is located are authorized by law or executive order to close, then the date for such payment shall be the next
succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are
authorized to close: and payment on such date shall have the same force and effect as if made on the original
date payment was due.
THIS BOND is one ofan issue of Bonds initially dated May 15,2005, authorized in accordance with
the Constitution and laws of the State of Texas in the principal amount of$5,000,000, FOR THE PURPOSE
OF THE ACQUISITION OF PROPERTY AND MAKING IMPROVEMENTS FOR PUBLIC PURPOSES
IN SAID CITY, TO-WIT: SENIOR CENTER AND LIBRARY IMPROVEMENTS, STREET
IMPROVEMENTS AND PARK IMPROVEMENTS.
ON FEBRUARY 15,2015, or on any date whatsoever thereafter, the Bonds of this Series may be
redeemed prior to their scheduled maturities, at the option of the Issuer, with funds derived from any available
and lawful source, as a whole, or in part, and, if in part, the particular Bonds, or portions thereof, to be
redeemed shall be selected and designated by the Issuer (provided that a portion of a Bond may be redeemed
only in an integral multiple of $5,000), at the redemption price of the par or principal amount thereof, plus
accrued interest to the date fixed for redemption.
AT LEAST 30 days prior to the date fixed for any redemption of Bonds or portions thereof prior to
maturity a written notice of such redemption shall be sent by the Paying Agent/Registrar by United States
maiL first-class postage prepaid, to the registered owner of each Bond to be redeemed at its address as it
appeared on the 45th day prior to such redemption date; provided, however, that the failure to send. mail, or
receive such notice. or any defect therein or in the sending or mailing thereof, shall not affect the validity or
effectiveness of the proceedings for the redemption of any Bond. By the date fixed for any such redemption
due provision shall be made with the Paying Agent/Registrarfor the payment of the required redemption price
for the Bonds or portions thereof which are to be so redeemed, plus accrued interest thereon to the date fixed
BRIZ: 0705.066\5-23-2005-GO-Ordinance
12
for redemption. Ifsuch wrinen notice of redemption is given and if due provision for such payment is made.
all as provided above, the Bonds or ponions thereof which arc to be so redeemed thereby automatically shall
be treated as redeemed prior to their scheduled maturities, and they shall not bear interest after the date fixed
for redemption, and they shall not be regarded as being outstanding except for the right of the registered
owner to receive the redemption price plus accrued interest from the Paying Agent/ Registrar out of the funds
provided for such payment. If a ponion of any Bond shall be redeemed a substitute Bond or Bonds having
the same maturity date, bearing interest at the same rate, in any denomination or denominations in any
integral multiple of$5,000, at the wrinen request of the registered owner. and in aggregate principal amount
equal to the umedeemed portion thereof, will be issued to the registered owner upon the surrender thereof
for cancellation, at the expense of the Issuer, all as provided in the Bond Ordinance.
THIS BOND OR ANY PORTION OR PORTIONS HEREOF IN ANY INTEGRAL MULTIPLE OF
$5,000 may be assigned and shall be transferred only in the Registration Books of the Issuer kept by the
Paying Agent/Registrar acting in the capacity of registrar for the Bonds, upon the tenns and conditions set
forth in the Bond Ordinance. Among other requirements for such assignment and transfer, this Bond must
be presented and surrendered to the Paying AgentIRegistrar, together with proper instruments of assignment,
in fonn and with guarantee of signatures satisfactory to the Paying AgentIRegistrar, evidencing assignment
of this Bond or any ponion or ponions hereof in any integral multiple of$5,000 to the assignee or assignees
in whose name or names this Bond or any such ponion or portions hereof is or are to be transferred and
registered. The form of Assignment printed or endorsed on this Bond shall be executed by the registered
owner or its duly authorized anorney or representative, to evidence the assignment hereof. A new Bond or
Bonds payable to such assignee or assignees (which then will be the new registered owner or owners of such
new Bond or Bonds), or to the previous registered owner in the case of the assignment and transfer of only
a portion of this Bond, may be delivered by the Paying AgentIRegistrar in conversion of and exchange for
this Bond, all in the fonn and manner as provided in the next paragraph hereof for the conversion and
exchange of other Bonds. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and
charges for making such transfer, but the one requesting such transfer shall pay any taxes or other
governmental charges required to be paid with respect thereto. The Paying Agent/Registrar shall not be
required to make transfers of registration of this Bond or any ponion hereof (i) during the period commencing
with the close of business on any Record Date and ending with the opening of business on the next following
principal or interest payment date, or, (ii) with respect to any Bond or any ponion thereof called for
redemption prior to maturity, within 45 days prior to its redemption date. The registered owner of this Bond
shall be deemed and treated by the Issuer and the Paying AgentIRegistrar as the absolute owner hereof for
all purposes, including payment and discharge of liability upon this Bond to the extent of such payment, and
the Issuer and the Paying Agent/Registrar shall not be affected by any notice to the contrary.
ALL BONDS OF THIS SERIES are issuable solely as fully registered bonds, without interest
coupons, in the denomination of any integral multiple of $5,000. As provided in the Bond Ordinance, this
Bond, or any umedeemed ponion hereof, may, at the request of the registered owner or the assignee or
assignees hereof, be convened into and exchanged for a like aggregate principal amount of fully registered
bonds, without interest coupons, payable to the appropriate registered owner, assignee, or assignees, as the
case may be, having the same maturity date, and bearing interest at the same rate, in any denomination or
denominations in any integral multiple of$5,000 as requested in writing by the appropriate registered owner,
assignee, or assignees, as the case may be, upon surrender of this Bond to the Paying Agent/Registrar for
cancellation, all in accordance with the fonn and procedures set forth in the Bond Ordinance. The Issuer shall
pay the Paying Agent/ Registrar's standard or customary fees and charges for transferring, convening, and
exchanging any Bond or any ponion 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 privilege of conversion and exchange. The Paying Agent/Registrar shall not be
BRIZ, 070S.066\S-23-200S-GO-Ordinano.
13
required to make any such conversion and exchange (i) during the period commencing with the close of
business on any Record Date and ending with the opening of business on the next following principal or
interest payment date, or, (ii) with respect to any Bond or portion thereof called for redemption prior to
maturity, within 45 days prior to its redemption date.
IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the Issuer, resigns, or
otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly will appoint
a competent and legally qualified substitute therefor, and will promptly cause written notice thereof to be
mailed to the registered owners of the Bonds.
IT IS HEREBY certified, recited, and covenanted that this Bond has been duly and validly voted,
authorized, issued, sold, and delivered; that all acts, conditions, and things required or proper to be perfonued,
exist, and be done precedent to or in the authorization, issuance, and delivery of this Bond have been
perfonued, existed, and been done in accordance with law; that this Bond is a general obligation of the Issuer,
issued on the full faith and credit thereof; and that annual ad valorem taxes sufficient to provide for the
payment of the interest on and principal of this Bond, as such interest comes due and such principal matures,
have been levied and ordered to be levied against all taxable property in the Issuer, and have been pledged
iITevocably for such payment, within the limit prescribed by law.
BY BECOMING the registered owner of this Bond, the registered owner thereby acknowledges all
of the tenus and provisions of the Bond Ordinance, agrees to be bound by such tenus and provisions,
acknowledges that the Bond Ordinance is duly recorded and available for inspection in the official minutes
and records of the governing body of the Issuer, and agrees that the tenus and provisions of this Bond and
the Bond Ordinance constitute a contract betWeen each registered owner hereof and the Issuer.
IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or facsimile
signature of the Mayor of the Issuer and countersigned and attested with the manual or facsimile signature
of the City Secretary of the Issuer, and has caused the official seal of the Issuer to be duly impressed, or
placed in facsimile, on this Bond.
ATIEST:
CITY OF DENTON, TEXAS
By:
Euline Brock
Mayor, City of Denton, Texas
By:
Jennifer Walters
City Secretary, City of Denton, Texas
(CITY SEAL)
BRIZ: 0705.066\5-23-2005-GO-Ordinance
14
FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTlFICA TE
(To be executed if this Bond is not accompanied by an executed Registration
CeI1ificate of the Comptroller of Public Accounts of the State of Texas)
It is hereby ceI1ified that this Bond has been issued under the provisions of the Bond Ordinance
described in this Bond; and that this Bond has been issued in conversion of and exchange for or replacement
of a bond, bonds, or a portion ofa bond or bonds of an issue which originally was approved by the Attorney
General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas.
JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION, DALLAS, TEXAS, Paying Agent/Registrar
Dated
By
Authorized Representative
(INSERT BOND INSURANCE LEGEND, IF ANY)
FORM OF ASSIGNMENT:
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned registered owner of this Bond, or duly authorized
representative or attorney thereof, hereby assigns this Bond to
/ /
(Assignee's Social
Security or Taxpayer
Identification Number)
(print or typewrite Assignee's name and
address, including zip code)
and hereby iITevocably constitutes and appoints
attorney to transfer the registration of this Bond on the Paying Agent/Registrar's Registration Books with full
power of substitution in the premises.
Dated:
Signature Guaranteed:
Registered Owner
NOTICE: This sib'11ature mustcoITespond with
the name of the Registered Owner appearing on
the face of this Certificate in every paI1icular
without alteration or enlargement or any
change whatsoever.
NOTICE: Signature(s) must be guaranteed by
an eligible guarantor institution paI1ieipating in
a securities transfer association recognized
signature guarantee program.
BRIZ: 0705.066\5-23-2005-GO-Ordinancc
15
Section 8. TAX LEVY. A special Interest and Sinking Fund (the "Interest and Sinking Fund") is
hereby created solely for the benefit of the Bonds, and the Interest and Sinking Fund shall be established and
maintained by the Issuer at an official depository bank of the Issuer. The Interest and Sinking Fund shall be
kept separate and apart from all other funds and accounts of the Issuer, and shall be used only for paying the
interest on and principal of the Bonds. All ad valorem taxes levied and collected for and on account of the
Bonds, together with any premium and accrued interest received upon sale of the Bonds, shall be deposited,
as collected, to the credit of the Interest and Sinking Fund. During each year while any of the Bonds or
interest thereon are outstanding and unpaid, the goveming body of the Issuer shall compute and ascertain
a rate and amount of ad valorem tax which will be sufficient to raise and produce the money required to pay
the interest on the Bonds as such interest becomes due, and to provide and maintain a sinking fund adequate
to pay the principal of its Bonds as such principal matures (but never less than 2% of the original principal
amount of the Bonds as a sinking fund each year). Said tax shall be based on the latest approved tax rolls of
the Issuer, with full allowance being made for tax delinquencies and the cost of tax collection. Said rate and
amount of ad valorem tax is hereby levied, and is hereby ordered to be levied, against all taxable property in
the Issuer for each year while any of the Bonds or interest thereon arc outstanding and unpaid: and said tax
shall be assessed and collected each such year and deposited to the credit of the aforesaid Interest and Sinking
Fund. Said ad valorem taxes sufficient to provide for the payment of the interest on and principal of the
Bonds, as such interest comes due and such principal matures, are hereby pledged for such payment, within
the limit prescribed by law.
Section 9. DEFEASANCE OF BONDS. (a) Any Bond and the interest thereon shall be deemed to
be paid, retired, and no longer outstanding (a "Defeased Bond") within themeaning of this Ordinance, except
to the extent provided in subsection (d) of this Section 9, when payment of the principal of such Bond, plus
interest thereon to the due date (whether such due date be by reason of maturity, upon redemption, or
otherwise) either (i) shall have been made or caused to be made in accordance with the terms thereof
(including the giving of any required notice of redemption), or (ii) shall have been provided for on or before
such due date by irrevocably depositing with or making available to the Paying Agent/Registrar for such
payment (1) lawful money of the United States of America sufficient to make such payment or (2)
Government Obligations which mature as to principal and interest in such amounts and at such times as will
insure the availability, without reinvestment, of sufficient money to provide for such payment, and when
proper arrangements have been made by the Issuer with the Paying Agent/Registrar for the payment of its
services until all Defeased Bonds shall have become due and payable. At such time as a Bond shall be
deemed to be a Defeased Bond hereunder, as aforesaid, such Bond and the interest thereon shall no longer
be secured by, payable from, or entitled to the benefits of, the ad valorem taxes herein levied and pledged as
provided in this Ordinance, and such principal and interest shall be payable solely from such money or
Government Obligations.
(b) Any moneys so deposited with the Paying Agent/Registrar may at the written direction of
the Issuer also be invested in Government Obligations, maturing in the amounts and times as hereinbefore
set forth, and all income from such Government Obligations received by the Paying Agent/Registrar which
is not required for the payment of the Bonds and interest thereon, with respect to which such money has been
so deposited, shall be turned over to the Issuer, or deposited as directed in writing by the Issuer.
(c) The term "Government Obligations" as used in this Section shall mean direct obligations of
the United States of America, including obligations the principal of and interest on which are unconditionally
guaranteed by the United States of America, which may be United States Treasury obligations such as its
State and Local Government Series, which may be in book-entry form.
BRIZ: 070S.066\S-23-200S-GO-Ordinance
16
(d) Until all Defeased Bonds shall have become due and payable, the Paying AgentlRegistrar
shall perform the services of Paying AgentlRegistrar for such Defeased Bonds the same as if they had not
been defeased, and the Issuer shall make proper arrangements to provide and pay for such services as required
by this Ordinance.
Section 10. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS. (a)
Replacement Bonds. In the event any outstanding Bond is damaged, mutilated, lost, stolen, or destroyed, the
Paying AgentlRegistrar shall cause to be printed, executed, and delivered, a new bond of the same principal
amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or destroyed Bond, in replacement
for such Bond in the manner hereinafter provided.
(b) Application for Replacement Bonds. Application for replacement of damaged, mutilated,
lost, stolen, or destroyed Bonds shall be made by the registered owner thereof to the Paying Agent/Registrar.
In every case of loss, theft, or destruction of a Bond, the registered owner applying for a replacement bond
shall furnish to the Issuer and to the Paying AgentlRegistrar such security or indemnity as may be required
by them to save each of them harmless from any loss or damage with respect thereto. Also, in every case of
loss, theft, or destruction of a Bond, the registered owner shall furnish to the Issuer and the Paying
Agent/Registrar evidence to their satisfaction of the loss, theft, or destruction of such Bond, as the case may
be. In every case of damage or mutilation of a Bond, the registered owner shall surrender to the Paying
Agent/Registrar for cancellation the Bond so damaged or mutilated.
(c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the event
of any such Bond shall have matured, and no default has occurred which is then continuing in the payment
of the principal of, redemption premium, if any, or interest on the Bond, the Issuer may authorize the payment
of the same (without surrender thereof except in the case ofa damaged or mutilated Bond) instead ofissuing
a replacement Bond, provided security or indemnity is furnished as above provided in this Section.
(d) Charge for Issuing Replacement Bonds. Prior to the issuance orany replacement bond. the
Paying Agent/Registrar shall charge the registered owner of such Bond with all legal, printing, and other
expenses in connection therewith. Every replacement bond issued pursuant to the provisions of this Section
by virtue of the fact that any Bond is lost, stolen, or destroyed shall constitute a contractual obligation of the
Issuer whether or not the lost, stolen, or destroyed Bond shall be found at any time, or be enforceable by
anyone. and shall be entitled to all the benefits of this Ordinance equally and proportionately with any and
all other Bonds duly issued under this Ordinance.
(e) Authoritv for Issuing Replacement Bonds. In accordance with Chapter 1201, Texas
Government Code, this Section of this Ordinance shall constitute authority for the issuance of any such
replacement bond without necessity offurther action by the governing body of the Issuer or any other body
or person, and the duty of the replacement of such bonds is hereby authorized and imposed upon the Paying
Agent/Registrar, and the Paying Agent/Registrar shall authenticate and deliver such Bonds in the form and
manner and with the effect, as provided in Section 6(d) of this Ordinance for Bonds issued in conversion and
exchange for other Bonds.
Section II. COYENANTSREGARDINGTAX-EXEMPTION. The Issuer covenants to refrain from
taking any action which would adversely affect, or to take such action to assure, the treatment of the Bonds
as obligations described in section 103 of the Internal Revenue Code of 1986, as amended (the "Code"), the
interest on which is not includable in the "gross income" of the holder for purposes of federal income
taxation. In furtherance thereof, the Issuer covenants as follows:
BRIZ: 0705.066\5-23-2005-GO-Ordinance
17
(a) to take any action to assure that no more than to percent of the proceeds of the
Bonds or the projccts fmanced therewith (less amounts deposited to a reserve fund, if any) are used
for any "privatc business use", as defmed in section 14 I (b)(6) of the Code, or if more than to percent
of the proceeds or the projects financed therewith are so used, such amounts, whether or not received
by the Issuer, with respect to such private business use, do not, under the terms of this Ordinance or
any underlying arrangement, directly or indirectly, secure or provide for the payment of more than
10 percent of the debt service on the Bonds, in contravention of section 14 t (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 five percent of the proceeds of the Bonds or the projects financed
therewith (less amounts deposited into a reserve fund, if any) then the amount in excess of five
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 five percent of the proceeds of the Bonds (less amounts deposited into a reserve fund,
if any) is, directly or indirectly, used to finance loans to persons, other than state or local
governmental units, in contravention of section 141(c) of the Code;
(d) to refrain from taking any action which would otherwise result in the Bonds being
treated as "private activity bonds" within the meaning of section 141(b) of the Code;
(e) to refrain from taking any action that would result in the Bonds being "federally
guaranteed" within the meaning of section 149(b) of the Code;
(I) to refrain from using any portion of the proceeds of the Bonds, directly or indirectly,
to acquire or to replace funds which were used, directly or indirectly, to acquire investment property
(as defined in section 148(b)(2) of the Code) which produces a materially higher yield over the term
of the Bonds, other than investment property acquired with--
(1) proceeds of the Bonds invested for a reasonable temporary period of3 years
or less, or in the case ofa refunding bonds, for a period 000 days or less until such proceeds
arc needed for the purpose for which the Bonds are issued,
(2) amounts invested in a bona fide debt service fund, within the meaning of
section t.t 48-1 (b) of the Treasury Regulations, and
(3) amounts deposited in any reasonably required reserve or replacement fund
to the extent such amounts do not exceed to percent of the stated principal amount (or, in
the case of a discount, the issue price) of the Bonds;
(g) to otherwise restrict the use of the proceeds of the Bonds or amounts treated as
proceeds of the Bonds, as may be necessary, so that the Bonds do not otherwise contravene the
requirements of section t 48 of the Code (relating to arbitrage), section I 49(g) of the Code (relating
to hedge bonds), and, to the extent applicable, section 149(d) of the Code (relating to advance
refundings); and
(h) to pay to the United States of America at least once during each five-year period
(beginning on the date of delivery of the Bonds) an amount that is at least equal to 90 percent of the
BRIZ: 070S.066\S-23-200S.GO.Ordinancc
18
"Excess Earnings", within the meaning of section t48(1) of the Code and to pay to the United States
of America, not later that 60 days after the Bonds have been paid in full, 100 percent of the amount
then required to be paid as a result of Excess Earnings under section 148(1) of the Code.
For purposes of the foregoing (a) and (b), the Issuer understands that the term "proceeds" includes
"disposition proceeds" as defined in the Treasury Regulations and, in the case of refunding bonds, transferred
proceeds (if any) and proceeds of the refunded bonds expended prior to the date of issuance of the Bonds.
It is the understanding of the Issuer that the covenants contained herein are intended to assure compliance
with the Code and any regulations or rulings promulgated by the U.S. Department of the Treasury pursuant
thereto. In the event that regulations or rulings are hereafter promulgated which modify, or expand provisions
of the Code, as applicable to the Bonds, the Issuer will not be required to comply with any covenant contained
herein to the extent that such failure to comply, in the opinion of nationally-recognized bond counsel, will
not adversely affect the exemption from federal income taxation of interest on the Bonds under section 103
of the Code. In the event that regulations or rulings are hereafter promulgated which impose additional
requirements which are applicable to the Bonds, the Issuer agrees to comply with the additional requirements
to the extent necessary and reasonably possible, in the opinion of nationally-recognized bond counsel, to
preserve the exemption from federal income taxation of interest on the Bonds under section 103 of the Code.
In furtherance of such intention, the Issuer hereby authorizes and directs the Mayor to execute any documents,
certificates or reports required by the Code and to make such elections, on behalf of the Issuer, which may
be permitted by the Code as are consistent with the purpose for the issuance of the Bonds. The Issuer
covenants to comply with the covenants in this section after defeasance of the Bonds.
In order to facilitate compliance with the above covenant (h), a "Rebate Fund" is hereby established
by the Issuer for the sole benefit of the United States of America, and such fund shall not be subject to the
claim of any other person, including without limitation, the bondholders. The Rebate Fund is established for
the additional purpose of compliance with section 148 of the Code.
Section 12. ALLOCATION OF, AND LIMITATION ON, EXPENDITURES FOR THE PROJECT.
The Issuer covenants to account for the expenditure of sale proceeds and investment earnings to be used for
the purposes described in Section I of this Ordinance (the "Project") on its books and records in accordance
with the requirements of the Internal Revenue Code. The Issuer recognizes that in order for the proceeds to
be considered used for the reimbursement of costs, the proceeds must be allocated to expenditures within 18
months of the later of the date that (I) the expenditure is made, or (2) the Project is completed; but in no event
later than three years after the date on which the original expenditure is paid. The foregoing notWithstanding,
the Issuer recognizes that in order for proceeds to be expended under the Internal Revenue Code, the sale
proceeds or investment earnings must be expended no more than 60 days after the later of (I) the fifth
anniversary of the delivery of the Bonds, or (2) the date the Bonds are retired. The Issuer agrees to obtain
the advice of nationally-recognized bond counsel if such expenditure fails to comply with the foregoing to
assure that such expenditure will not adversely affect the tax-exempt status of the Bonds. For purposes
hereof, the Issuer shall not be obligated to comply with this covenant if it obtains an opinion that such failure
to comply will not adversely affect the excludability for federal income tax purposes from gross income of
the interest.
Section 13. DISPOSITION OF PROJECT. The Issuer covenants that the property constituting the
Project will not be sold or otherwise disposed in a transaction resulting in the receipt by the Issuer of cash
or other compensation, unless the Issuer obtains an opinion of nationally-recognized bond counsel that such
sale or other disposition will not adversely affect the tax-exempt status of the Bonds. For purposes hereof,
the Issuer shall not be obligated to comply with this covenant ifit obtains a legal opinion that such failure to
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comply will not adversely affect the excludability for federal income tax purposes from gross income of the
interest.
Section 14. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND COUNSEL'S
OPINION, CUSIP NUMBERS, PREAMBLE AND INSURANCE. The Mayor of the Issuer is hereby
authorized to have control of the Initial Bond issued hereunder and all necessary records and proceedings
penaining to the Initial Bond pending its delivery and its investigation, examination, and approval by the
Attorney General of the State of Texas, and its registration by the Comptrollerofpublic Accounts of the State
of Texas, Upon registration of the Initial Bond said Comptroller of Public Accounts (or a deputy designated
in writing to act for said Comptroller) shall manually sign the Comptroller's Registration Certificate on the
Initial Bond, and the seal of said Comptroller shall be impressed, or placed in facsimile, on the Initial Bond.
The approving legal opinion of the Issuer's Bond Counsel and the assigned CUSIP numbers may, at the option
of the Issuer, be printed on the Initial Bond or on any Bonds issued and delivered in conversion of and
exchange or replacement of any Bond, but neither shall have any legal efTect, and shall be solely for the
convenience and information of the registered owners of the Bonds. The preamble to this Ordinance is
hereby adopted and made a part hereof for all purposes, If insurance is obtained on any of the Bonds, the
Initial Bond and all other Bonds shall bear an appropriate legend concerning insurance as provided by the
insurer.
Section 15. SALE OF INITIAL CERTIFICATE; BOND INSURANCE. (a) The Initial Bond is
hereby sold and shall be delivered to RBC DAIN RAUSCHER INc., as representative of the underwriters,
in accordance with the Purchase Contract dated the date of this meeting and presented to the City Council
of the City at this meeting. The City Council hereby finds that the terms of the Purchase Contraet are the
most advantageous terms for the City that are reasonably available. The Mayor of the Issuer is authorized
and directed to execute, on behalf of the Issuer, said Purchase Contract in the form and substance submitted
at this meeting.
(b) The Issuer approves the insurance of the Bonds by Ambac Assurance Corporation and the
payment of the premium on the Insurance Policy, and agrees to comply with the terms of the "Provisions
Relating to Bond Insurance" attached hereto as Exhibit B and incorporated herein.
Section 16. OFFICIAL STATEMENT. An Omcial Statement dated as of the date of this meeting
has been prepared in connection with the sale of the Initial Bond and the Bonds, in the form and substance
submitted at this meeting. Said Omcial Statement and any supplement or addenda thereto have been and
are hereby approved, and their use in the afTer and sale of the Bonds is hereby approved. It is funher
omcially found, detenn ined, and declared that tile statements and representations contained in said Official
Statement are true and colTect in all material rcspects, to tile best knowledge and bclief of the Issuer. The
distribution and use of the Preliminary Omcial Statement dated May t 7, 2005, prior to the date hereof is
hereby ratified and approved.
Section 17. INTEREST EARNINGS ON BOND PROCEEDS. Interest earnings derived from the
invesnnent of proceeds from the sale of the Initial Bond shall be used along with other bond proceeds for the
aequisition and construction of the improvements for which the Bonds are issued; provided that after
completion of such improvements, 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
bond proceeds which are required to be rebated to the United States of America pursuant to Section 1 thereof
in order to prevent the Bonds from being arbitrage bonds shall be so rebated and not considered as interest
earnings for the purposes of this Section.
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Section 18. DTC REGISTRATION. The Bonds initially shall be issued and delivered in such
manner that no physical distribution of the Bonds will be made to the public, and The Depository Trust
Company ("DTC"), New York, New York, initially will act as depository for the Bonds. DTC has
represented that it is a limited purpose trust company incorporated under the laws of the State of New York,
a member of the Federal Reserve System, a "elearing corporation" within the meaning of the New York
Unifonn Commercial Code, and a "clearing agency" registered under Section t 7 A of the federal Securities
Exchange Act of 1934, as amended, and the Issuer accepts, but in no way verifies, such representations. The
Initial Bond authorized by this Ordinance shall be delivered to and registered in the name of the Purchaser.
However, it is a condition of delivery and sale that the Purchaser, immediately after such delivery, shall cause
the Paying Agent/Registrar, as provided for in this Ordinance, to cancel said Initial Bond and deliver in
exchange therefor a substitute Bond for each maturity of such Initial Bond, with each such substitute Bond
to be registered in the name of CEDE & CO., the nominee ofDTC, and it shall be the duty of the Paying
Agent/Registrar to take such action. It is expected that DTC will hold the Bonds on behalf of the Purchaser
and/or The DTC Participants, as defined and described in the Official Statement referred to and approved in
Section 15 hereof (the "DTC Participants"). So long as each Bond is registered in 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 Bonds by DTC Participants in integral amounts of $5,000, with transfers of
ownership being e!Tected on the records ofDTC and the DTC Participants pursuant to rules and regulations
established by them, and that the substitute Bonds initially deposited with DTC shall be immobilized and not
be further exchanged for substitute Bonds except as hereinafter provided. The Issuer is not responsible or
liable for any functions of DTC, will not be responsible for paying any fees or charges with respect to its
services, will not be responsible or liable for maintaining, supervising, or reviewing the records of DTC or
the DTC Participants, or protecting any interests or rights of the beneficial owners of the Bonds. It shall be
the duty of the Purchaser and the DTC Participants to make all arrangements with DTC to establish this book-
entry system, the beneficial ownership of the Bonds, and the method of paying the fees and charges ofDTc.
The Issuer does not represent, nor does it in any way covenant that the initial book-entry system established
with DTC will be maintained in the future. The Issuer reserves the right and option at any time in the future,
in its sole discretion, to tenninate the DTC (CEDE & CO.) book-entry only registration requirement described
above, and to pennit the Bonds to be registered in the name of any owner. If the Issuer exercises its right and
option to terminate such requirement, it shall give written notice of such tennination to the Paying Agent/
Registrar and to DTC, and thereafter the Paying Agent/Registrar shall, upon presentation and proper request,
register any Bond in any name as provided for in this Ordinance. Notwithstanding the initial establishment
of the foregoing book-entry system with DTC, if for any reason any of the originally delivered substitute
Bonds is duly filed with the Paying Agent/Registrar with proper request for transfer and substitution, as
provided for in this Ordinance, substitute Bonds will be duly delivered as provided in this Ordinance, and
there will be no assurance or representation that any book-entry system will be maintained for such Bonds.
Section 19. CONTINUING DISCLOSURE. (a) Annual ReDolts. (i) The Issuer shall provide
annually to each NRMSIR and any SID, within six months after the end of each fiscal year ending in or after
2004, financial information and operating data with respect to the Issuer of the general type included in the
final Official Statement authorized by Section 16 of this Ordinance, being the infonnation described in
Exhibit A hereto, which Exhibit is attached to and incorporated in this Ordinance as if written word for word
herein. Any financial statements so to be provided shall be (1) prepared in accordance with the accounting
principles described in Exhibit A hereto, or such other accounting principles as the Issuer may be required
to employ from time to time pursuant to state law or regulation, and (2) audited, if the Issuer commissions
an audit of such statements and the audit is completed within the period during which they must be provided.
If the audit of such financial statements is not complete within such period, then the Issuer shall provide
unaudited financial statements by the required time and will provide audited financial statements for the
BRIZ, 0705.066\5-23-2005-GO-Ordinance
21
applicable fiscal year to each NRMSIR and any SID, when and if the audit report on such statements become
available.
(ii) If the Issuer changes its fiscal year, it will notify each NRMSIRand any SID of the change (and
of the date of the new fiscal year end) prior to the next date by which the Issuer otherwise would be required
to provide financial information and operating data pursuant to this Section. The financial information and
operating data to be provided pursuant to this Section may be set forth in full in one or more documents or
may be included by specific reference to any doewnent (including an official statement or other offering
document, ifit is available from the MSRB) that theretofore has been provided to each NRMSIR and any SID
or filed with the SEe.
(b) Material Event Notices. The Issuer shall notifY any SID and either each NRMSIR or the MSRB,
in a timely manner, of any of the following events with respect to the Bonds, if such event is material within
the meaning of the federal securities laws:
I.
Principal and interest payment delinquencies;
2.
Non-payment related defaults;
3.
Unscheduled draws on debt service reserves reflecting financial difficulties;
4.
Unscheduled draws on credit enhancements reflecting fInancial difficulties;
5.
Substitution of credit or ltquidity providers, or their failure to perform;
6.
Adverse tax opinions or events affecting the tax-exempt status of the Bonds;
7.
Modifications to rights of holders of the Bonds;
8.
Bond calls;
9.
Defeasances:
10.
Release, substitution, or sale of property securing repayment of the Bonds; and
II.
Rating changes.
The Issuer shall notify any SID and either each NRMSIR or the MSRB, in a timely manner, of any failure
by the Issuer to provide financial information or operating data in accordance with subsection (a) of this
Section by the time required by such subsection.
(c) Limitations Disclaimers and Amendments. (i) The Issuer shall be obligated to observe and
perform the covenants specified in this Section for so long as, but only for so long as. the Issuer remains an
"obligated person" with respect to the Bonds within the meaning of the Rule, except that the Issuer in any
event will give the notice required by Subsection (b) hereof of any Bond calls and defeasance that cause the
Issuer to no longer be such an "obligated person".
(ii) The provisions of this Section are for the sole benefit of the registered owners and beneficial
owners of the Bonds, and nothing in this Section, express or implied, shall give any benefit or any legal or
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22
equitable right, remedy, or claim hereunder to any other person. The Issuer undertakes to provide only the
financial information, operating data, financial statements, and notices which it has expressly agreed to
provide pursuant to this Section and does not hereby undertake to provide any other information that may be
relevant or material to a complete presentation of the Issuer's financial results, condition, or prospects or
hereby undertake to update any information provided in accordance with this Section or otherwise, except
as expressly provided herein. The Issuer does not make any representation or warranty concerning such
information or its usefulness to a decision to invest in or sell Bonds at any future date.
(iii) UNDER NO CIRCUMST ANCES SHALL THE ISSUER, ITS OFFICERS, AGENTS AND
EMPLOYEES, BE LIABLE TO THE REGISTERED OWNER OR BENEFICIAL OWNER OF ANY
BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT, FOR DAMAGES RESULTING IN
WHOLE OR IN PART FROM ANY BREACH BY THE ISSUER, WHETHER NEGLIGENT OR
WITHOUT FAULT ON ITS PART, OF ANY COVENANT SPECIFIED IN THIS SECTION, BUT EVERY
RIGHT AND REMEDY OF ANY SUCH PERSON, IN CONTRACTOR TORT, FORORON ACCOUNT
OF ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC
PERFORMANCE
(iv) No default by the Issuer in observing or performing its obligations under this Section shall
comprise a breach of or default under the Ordinance for purposes of any other provision of this Ordinance.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the duties of the Issuer
under federal and state securities laws.
(v) The provisions of this Section may be amended by the Issuer from time to time to adapt to
changed circumstances that arise from a change in legal requirements, a change in law, or a change in the
identity, nature, status, or type of operations of the Issuer, but only if (1) the provisions of this Section, as so
amended, would have permitted an underwriter to purchase or sell Bonds in the primary offering of the Bonds
in compliance with the Rule, taking into account any amendments or interpretations of the Rule since such
offering as well as such changed circumstances and (2) either (a) the registered owners of a majority in
aggregate principal amount (or any greater amount required by any other provision of this Ordinance that
authorizes such an amendment) of the outstanding Bonds consent to such amendment or (b) a person that is
unaffiliated with the Issuer (such as nationally recognized bond counscl) determined that such amendment
will not materially impair the interest of the registered owners and beneficial owners of the Bonds. If the
tssuer so amends the provisions of this Section, it shall include with any amended financial information or
operating data next provided in accordance with subsection (a) of this Section an explanation, in narrative
form, of the reason for the amendment and of the impact of any change in the type of financial information
or operating data so provided. The Issuer may also amend or repeal the provisions of this continuing
disclosure agreement if the SEC amends or repeals the applicable provision of the Rule or a court of final
jurisdiction enters judgment that such provisions of the Rule arc invalid, but only if and to the extent that the
provisions of this sentence would not prevent an underwriter from lawfully purchasing or selling Bonds in
the primary offering of the Bonds.
(d) Definitions. As used in this Section, the following terms have the meanings ascribed to such
terms below:
"MSRB" means the Municipal Securities Rulemaking Board.
"NRMSIR" means each person whom the SEC or its staff has determined to be a nationally
recognized municipal securities information repository within the meaning of the Rule from time to time.
BRIZ: 070S.066\S-23-200S-GO-Ord;nancc
23
"Rule" means SEC Rule 15c2-t2, as amended from time to time.
"SEe" means the United States Securities and Exchange Commission.
"SID" means any person designated by the State of Texas or an authorized department, officer, or
agency thereof as, and detennined by the SEC or its staff to be, a state infonnation depository within the
meaning of the Rule from time to time.
Section 20. PROTECTION OF PLEDGE. Chapter 1208, Govcrnment Code, applies to the issuance
of the Bonds and the pledge of the taxes granted by the Issuer under Section 8 of this Ordinance, and is
therefore valid, effective, and perfected. If Texas law is amended at any time while the Bonds are outstanding
and unpaid such that the pledge of the taxes granted by the Issuer under Section 8 of this Ordinance is to be
subject to the filing requirements of Chapter 9, Texas Business & Commerce Code, then in order to preserve
to the registered owners of the Bonds the perfection of the security interest in said pledge, the Issuer agrees
to take such measures as it detennines are reasonable and necessary under Texas law to comply with the
applicable provisions of Chapter 9, Texas Business & Commerce Code and enable a filing to perfect the
security interest in said pledge to occur.
Section 21. 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 perfonn all such
acts and things and to execute, acknowledge, and deliver in the name and under the corporate seal and on
behalf of the Issuer all such instruments, whether or not herein mentioned, as may be necessary or desirable
in order to carry out the tenns and provisions of this Ordinance, the Bonds, the sale of the Bonds, and the
Notice of Sale and Official Statement; and the Assistant City ManagerlFiscal and Municipal Services of the
City shall cause the expenses of issuance of the Bonds to be paid from the proceeds of sale of the Initial Bond
or from any other lawfully available funds of the Issuer. In case any officer whose signature shall appear on
any Bond shall cease to be such officer before the delivery of such Bond, such signature shall nevertheless
be valid and sufficient for all purposes the same as if such officer had remained in office until such delivery.
Section 22. OPEN MEETINGS. The City Council has found and determined that the meeting at
which this Ordinance is considered is open to the public and that notice thereof was given in accordance with
the provisions of the Texas Open Meetings, Law, Tex. Gov't. Code, Chapter 551, as amended.
Section 23. EFFECTIVE DATE. This Ordinance shall become effective immediately upon its
passage and approval.
BRIZ: 0705.066\5-23-2005-GO-Ordinance
24
PASSED AND APPROVED this the 24th day of May, 2005.
e ~ ~oÂL
Entine Brock, Mayor
ATTEST:
Jennifer Walters. City Secretary
~\>1J\^ \~Qb'l\
APPROVED AS TO LEGAL FORM:
Edwin ~nterim City lIomey
By:
------------------------------------
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EXHIBIT A
DESCRIPTION OF ANNUAL FINANCIAL INFORMATION
The following information is referred to in Section 19 of this Ordinance:
Annual Financial Statements and Operating Data
The financial information and operating data with respect to the Issuer to be provided annually in
accordance with such Section are as specified (and included in the Appendix or under the tables of the
Official Statement referred to) below:
Tables numbered I through 15, inclusive, under the captions "Tax Information", "Debt Service
Requirements" and "Financiallnformation" in the Official Statement.
Appendix B in the Official Statement.
Accounting Principles
The accounting principles referred to in such Section are the accounting principles described in the
notes to the financial statements referred to in the paragraph above.
___mn_m____m_mn_--------------
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A-I
EXHIBIT B
PROVISIONS RELATING TO BOND INSURANCE
NotWithstanding any provision the Ordinance to the contrary, the following provisions shall apply
so long as the Financial Guaranty Insurance Policy (as defined below) is in effect and Ambac Assurance (as
defined below) is not in default thereunder.
Part I. Definitions.
"Ambac Assurance" shall mean Ambac Assurance Corporation, a Wisconsin-domiciled stock
insurance company.
"Financial Guaranty Insurance Policy" shall mean the financial guaranty insurance policy issued by
Ambac Assurance insuring the payment when due of the principal of and interest on the Bonds as
provided therein.
Part 2. Ambac Consent.
(a) Consent of Ambac Assurance. Any provision of this Ordinance expressly recognizing or granting
rights in or to Ambac Assurance may not be amended in any manner which affects the rights of Ambac
Assurance hereunder without the prior written consent of Ambac Assurance.
(b) Consent of Ambac Assurance in Addition to Registered Owner Consent. Unless otherwise
provided in this Exhibit B, Ambac Assurance's consent shall be required in addition to registered owner
consent, when required, for the following purposes: (i) any amendment, supplement or change to or
modification of the Ordinance (ii) removal of the Paying Agent/Registrar and selection and appoinnnent of
any successor Paying AgentlRegistrar; and (iii) initiation or approval of any action not described in (i) or (ii)
above which requires registered owner consent.
(c) Consent of Ambac Assurance in the Event oflnsolvencv. Any reorganization or liquidation plan
with respect to the Issuer must be acceptable to Ambac Assurance. In the event of any reorganization or
liquidation, Ambac Assurance shall have the right to vote on behalf of all registered owners who hold Ambac
Assurance-insured Bonds absent a default by Ambac Assurance under the Financial Guaranty Insurance
Policy.
(d) Consent of Ambac Assurance UDon Default. Anything in this Ordinance to the contrary
notwithstanding, upon the OCCUITence and continuance of an event of default under the Ordinance, Ambac
Assurance shall be entitled to control and direct the enforcement of all rights and remedies granted to the
registered owners for the benefit of the registered owners under this Ordinance.
Part 3. Notices/lnfonnation to Be Given to Ambac.
(a) Notices to be sent to the attention of the Surveillance DeDarnnent:
(I) While the Financial Guaranty Insurance Policy is in effect, the Issuer shall furnish to Ambac
Assurance:
BRIZ: 0705.066\5-23-2005-GO-O,dinancc
B-1
(A) as soon as practicable after the filing thereof, a copy of any audit and annual fmancial
repoI1 of the Issuer;
(B) such additional infonuation it may reasonably request.
(2) A copy of any notice to be given to the registered owners of the Bonds, including, without
limitation, notice of any redemption of or defeasance of Bonds, and any ceI1ificate rendered pursuant
to this Ordinance relating to the security for the Bonds.
(3) To the extent that the Issuer has entered into a continuing disclosure agreement with respect to
the Bonds, Ambac Assurance shall be included as party to be notified.
(b) Notices to be sent to the attention of the General Counsel Office:
(I) The Issuer shall notifY Ambac Assurance of any failure of the Issuer to provide relevant notices,
certificates, etc.
(2) Notwithstanding any other provision of this Ordinance, the Issuer shall immediately notify
Ambac Assurance if at any time there are insufficient moneys to make any payments of principal
and/or interest as required and immediately upon the occurrence of any event of default hereunder.
(c) Other Information to be given to Ambac Assurance:
The Issuer will penn it Ambac Assurance to discuss the affairs, finances and accounts of the Issuer
or any infonnation Ambac Assurance may reasonably request regarding the security for the Bonds
with appropriate officers of the Issuer. The Issuer will pennit Ambac Assurance to have access to and
to make copies of all books and records relating to the Bonds at any reasonable time.
Part 4. Defeasance.
(a) Notwithstanding anything herein to the contrary, in the event that the principal and/or interest
due on the Bonds shall be paid by Ambac Assurance Corporation pursuant to the Financial Guaranty
Insurance Policy. the Bonds shall remain Outstanding for all purposes, not be defeased or otherwise satisfied
and not be considered paid by the Issuer, and the assignment and pledge of the funds pledged to the payment
of the Bonds and all covenants, agreements and other obligations of the Issuer to the registered owners shall
continue to exist and shall run to the benefit of Ambac Assurance, and Ambac Assurance shall be subrogated
to the rights of such registered owners.
(b) The following obligations are pennitted investments for the defeasance of the Bonds pursuant
to Section 6 of the Ordinance, but only to the extent such investments are authorized by applicable State law
and subject to any limitations with respect thereto set fonh in the Ordinance:
(1) cash;
(2) direct, obligations of the United States of America, ineluding obligations that are unconditionally
guaranteed by the United States of America; and
(3) other investments approved in writing by Ambac Assurance.
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Part 5. Payment Procedure Pursuant to the Financial Guaranty Insurance Policy.
(a) At least one (I) day prior to all Interest Payment Dates the Paying AgentlRegistrar, if any, will
detennine whether there will be sufficient funds in the Funds to pay the principal of or interest on the Bonds
on such Interest Payment Date. lithe Paying AgentIRegistrar detennines that there will be insufficient funds
in such Funds or Accounts, the Paying AgentIRegistrar shall so notify Ambac Assurance. Such notice shall
specifY the amount of the anticipated deficiency, the Bonds to which such deficiency is applicable and
whether such Bonds will be deficient as to principal or interest, or both. If the Paying Agent/Registrar has
not so notified Ambac Assurance at least one (I) day prior to an Interest Payment Date, Ambac Assurance
will make payments of principal or interest due on the Bonds on or before the first (I st) day next following
the date on which Ambac Assurance shall have received notice of nonpayment from the Paying
Agent/Registrar, if any.
(b) The Paying Agent/Registrar shall, after giving notice to Ambac Assurance as provided in (a)
above, make available to Ambac Assurance and, at Ambac Assurance's direction, to The Bank of New York,
in New York, New York, as insurance trustee for Ambac Assurance or any successor insurance trustee (the
"Insurance Trustee"), the registration books of the Issuer maintained by the Paying AgentlRegistrar and all
records relating to the funds and accounts maintained under this Ordinance.
(c) The Paying Agent/Registrar shall provide Ambac Assurance and the Insurance Trustee with a list
of registered owners of Bonds entitled to receive principal or interest payments from Ambac Assurance under
the tenns of the Financial Guaranty Insurance Policy, and shall make arrangements with the Insurance Trustee
(i) to mail checks or drafts to the registered owners of Bonds entitled to receive full or partial interest
payments from Ambae Assurance and (ii) to pay principal upon Bonds surrendered to the Insurance Trustee
by the registered owners of Bonds entitled to receive full or partial principal payments from Ambac
Assurance.
(d) The Paying AgentIRegistrar shall, at the time it provides notice to Ambac Assurance pursuant to
(a) above, notifY registered owners of Bonds entitled to receive the payment of principal or interest thereon
from Ambac Assurance (i) as to the fact of such entitlement, (ii) that Ambac Assurance will remit to them
all or a part of the interest payments next coming due upon proof of registered owner entitlement to interest
payments and delivery to the Insurance Trustee, in fonn satisfactory to the Insurance Trustee, of an
appropriate assignment of the registered owner's right to payment, (iii) that should they be entitled to receive
full payment of principal from Ambac Assurance, they must surrender their Bonds (along with an appropriate
instrument of assignment in form satisfactory to the Insurance Trustee to pennit ownership of such Bonds
to be registered in the name of Ambac Assurance) for payment to the Insurance Trustee, and not the Paying
Agent/Registrar, and (iv) that should they be entitled to receive partial payment of principal from Ambac
Assurance, they must surrender their Bonds for payment thereon first to the Paying Agent/Registrar, who
shall note on such Bonds the portion of the principal paid by the Paying Agent/Registrar, and then, along with
an appropriate instrument of assignment in fonn satisfactory to the Insurance Trustee, to the Insurance
Trustee, which will then pay the unpaid portion of principal.
(e) In the event that the Paying AgentlRegistrar has notice that any payment of principal of or interest
on an Bond which has become Due for Payment and which is made to a registered owner by or on behalf of
the Issuer has been deemed a preferential transfer and theretofore recovered from its registered owner
pursuant to the United States Bankruptcy Code by a trustee in bankruptcy in accordance with the final,
nonappealable order of a court having competent jurisdiction, the Paying Agent/Registrar shall, at the time
Ambac Assurance is notified pursuant to (a) above, notifY all registered owners that in the event that any
registered owner's payment is so recovered, such registered owner will be entitled to payment from Ambac
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Assurance to the extent of such recovery if sufficient funds are not otherwise available, and the Paying
Agent/Registrar shall furnish to Ambac Assurance its records evidencing the payments of principal of and
interest on the Bonds which have been made by the Paying Agent/Registrar and subsequently recovered from
registered owners and the dates on which such payments were made.
(1) In addition to those rights granted Ambac Assurance under this Ordinance, Ambac Assurance
shall, to the extent it makes payment of principal of or interest on Bonds, become subrogated to the rights of
the recipients of such payments in accordance with the tenus of the Financial Guaranty Insurance Policy, and
to evidence such subrogation (i) in the case of subrogation as to claims for past due interest, the Paying
Agent/Registrar shall note Ambac Assurance's rights as subrogee on the registration books of the Issuer
maintained by the Paying Agent/Registrar upon receipt from Ambac Assurance of proof of the payment of
interest thereon to the registered owners of the Bonds, and (ii) in the case of subrogation as to claims for past
due principal, the Paying AgentlRegistrar shall note Ambac Assurance's rights as subrogee on the registration
books of the Issuer maintained by the Paying Agent/Registrar upon surrender ofthe Bonds by the registered
owners thereof together with proof of the payment of principal thereof
Part 6. Ambac As Third Partv Beneficiarv.
To the extent that this Ordinance confers upon or gives or grants to Ambac any right, remedy or claim
under or by reason of this Ordinance, Ambac is hereby explicitly recognized as being a third-party beneficiary
hereunder and may enforce any such right remedy or claim conferred, given or granted hereunder.
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