HomeMy WebLinkAbout1988-O-06 - Utility System Refunding Revenue BondsORDINANCE NO. 1988-06
AN ORDINANCE authorizing the issuance of "CITY OF
STEPHENVILLE, TEXAS, UTILITY SYSTEM REFUNDING REVENUE
BONDS, SERIES 1988"; pledging the net revenues of the
City's Utility System to the payment of the principal
of and interest on said bonds; enacting provisions
incident and related to the issuance, payment, security
and delivery of said bonds; authorizing the execution
of certain agreements in connection with the payment of
the refunded bonds and the bonds now being issued; and
declaring an emergency.
WHEREAS, the City of Stephenville, Texas (the "City")
has duly issued and delivered, and there are currently
outstanding, the following series or issue of obligations
(the "Prior Issue") which is in whole or in part payable
from and secured by a lien on and pledge of the net revenues
of City' s Utility System (the."System"), to -wit: _
City of Stephenville, Texas, Waterworks and Sewer
System Refunding and Improvement Revenue Bonds, Series
1985, dated October 1, 1985, and now outstanding in the
principal sum of ....................$ 71785,000
AND WHEREAS, the City Council has determined that
refunding bonds should be issued in an amount sufficient to
discharge and make final payment of the principal of and
interest on a portion of the Prior Issue, to -wit: those
Series 1985 Bonds maturing on June 1 in each of the years
1996 through 2006, inclusive, aggregating $5,930,000 in
principal amount (the "Refunded Obligations"), when and as
the same shall become due and payable to provide a debt
service savings to the City;
AND WHEREAS, the City Council reserved the right in the
ordinance authorizing the issuance of the Prior Issue to
issue refunding bonds to refund all or any part of the
outstanding Bonds Similarly Secured (as hereinafter de-
fined), which refunding bonds may be on a parity with the
Prior Issue;
AND WHEREAS, Article 717k, V.A.T.C.S., as amended,
authorizes the City to enter into an escrow agreement with
any paying agent for the Refunded Obligations with respect
to the safekeeping, investment, reinvestment, administration
and disposition of any such deposit, upon such terms and
conditions as the City and such paying agent may agree,
provided that such deposits may be invested and reinvested
only in 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, and which shall mature and bear interest payable at
such times and in such amounts as will be sufficient to
provide for the scheduled payment or prepayment of the
Refunded Obligations;
AND WHEREAS, First RepublicBank Dallas, National
Association (formerly RepublicBank Dallas, National Associa-
tion) , Dallas, Texas, is the paying agent for the Refunded
Obligations; and the Escrow Agreement hereinafter authorized
constitutes an escrow agreement of the kind authorized and
permitted by said Article 717k, V.A.T.C.S.;
AND WHEREAS, the Refunded Obligations are scheduled to
mature, or are subject to redemption prior to maturity, not
more than 20 years from the date of the bonds hereinafter
authorized;
AND WHEREAS, the bonds hereinafter authorized to be
issued to refund the Refunded Obligations shall be on a
parity with Prior Issue; now, therefore
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
STEPHENVILLE, TEXAS:
SECTION 1: Authorization -Designation -Principal Amount
Purpose. Revenue bonds of the City shall be and are hereby
authorized to be issued in the aggregate principal amount of
$7,045, 000, to be designated and bear the title "City of
Stephenville, Texas, Utility System Refunding Revenue Bonds,
Series 1988" (hereinafter referred to as the "Bonds") , for
the purpose of refunding certain outstanding obligations of
the City (identified in the preamble hereof as the "Refunded
Obligations"), in conformity with the Constitution and laws
of the State of Texas, including Article 717k, as amended,
V.A.T.C.S.
SECTION 2: Authorized Denominations - Maturities. The
Bonds shall be issued in fully registered form only, shall
be dated March 15, 1988 (the "Bond Date") and shall be in
denominations of $5,000 or any integral multiple thereof,
and shall become due and payable on June 1 in each of the
years and in principal amounts (the "Stated Maturities") and
bear interest at the rates per annum in accordance with the
following schedule:
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Year of
Principal
Interest
Stated Maturity
Amount ($ )—
Rate
1989
30,000
5.00
1990
35,000
5.25
1991
70,000
5.50
1992
70,000
5.75
1993
75,000
6.00
1994
80,000
6.20
1995
80,000
6.40
1996
415,000
6.60
1997
445,000
6.75
1998
475,000
6.90
1999
510,000
7.05
2000
545,000
7.15
2001
580,000
7.25
2002
625,000
7.35
2003
670,000
7.40
2006
21340,000
7.60
The Bonds shall bear interest on the unpaid principal
amounts from the Bond Date at the rates per annum shown
above in this Section. Interest on the Bonds shall be
payable on June 1 and December 1 in each year, commencing
June 1, 1988. The Bonds maturing in the year 2006 are
hereby designated "Term Bonds", and shall be subject to
retirement by operation of the "Mandatory Redemption Ac-
count", as herein provided.
SECTION 3: Terms of Payment-PayincTAgent. Registrar.
The principal of, premium, if any, and the interest on the
Bonds, due and payable by reason of maturity, redemption or
otherwise, shall be payable only to the registered owners or
holders of the Bonds (hereinafter called the "Holders")
appearing on the registration and transfer books (the
"Registration Books") maintained by the Paying
Agent/Registrar (hereinafter defined) and the payment
thereof shall be in any coin or currency of the United
States of America, which at the time of payment is legal
tender for the payment of public and private debts, and
shall be without exchange or collection charges to the
Holders.
The selection and appointment of First Interstate Bank
of Texas, National Association, Houston, Texas to serve as
Paying Agent/Registrar for the Bonds (the "Paying
Agent/Registrar" ) is hereby approved and 'confirmed . The
execution by the officials of the City of the "Paying
Agent/Registrar Agreement' in substantially the form at-
tached as Exhibit A is hereby authorized. The City cove-
nants to maintain and provide a Paying Agent/Registrar at
all times until the Bonds are paid and discharged, and any
successor Paying Agent/Registrar shall be a commercial bank,
K
trust company or other financial institution organized under
the laws of the United States or a state thereof, and
qualified and authorized to serve in such capacity and
perform the duties and services of Paying Agent/Registrar.
Upon any change in the Paying Agent/Registrar for the Bonds,
the City agrees to promptly cause a written notice thereof
to be sent to each registered owner of the Bonds by United
States Mail, first class postage prepaid, which notice shall
also give the address of the new Paying Agent/Registrar.
Principal of and premium, if any, on the Bonds shall be
payable at the Stated Maturity or the redemption thereof,
only upon presentation and surrender of the Bonds to the
Paying Agent/Registrar at its principal office. Interest on
the Bonds shall be paid to the Holder whose name appears on
the Registration Books at the close of business on the 15th
day of the month next preceding each interest payment date
(the "Record Date") and shall be paid by the Paying
Agent/Registrar (i) by check sent United States Mail, f first
class postage prepaid, to the address of the registered
owner recorded on the Registration Books or (ii) by such
other method, acceptable to the Paying Agent/Registrar,
requested by, and at the risk and expense of, the Holder.
If the date for the payment of the principal of or interest
on the Bonds 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 Satur-
day, Sunday, legal holiday, or day on which banking institu-
tions 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.
SECTION 4: Redemption. (a) O tional Redemption. The
Bonds having Stated Maturities on and after June 1, 1999,
shall be subject to redemption prior to maturity, at the
option of the City, in whole or in part in principal amounts
of $5,000 or any integral multiple thereof (and if within a
Stated Maturity by lot by the Paying Agent/Registrar), on
June 1, 1998 or on any interest payment date thereafter, at
the redemption price of par plus accrued interest to the
date of redemption.
(b) Exercise of Redemption Option. At least for-
ty-five (45) days prior to a redemption date for the Bonds
(unless a shorter notification period shall be satisfactory
to the Paying Agent/Registrar), the City shall notify the
Paying Agent/Registrar of the decision to redeem Bonds, the
principal amount of each Stated Maturity to be redeemed, and
the date of the redemption therefor. The decision of the
City to exercise the right to redeem Bonds shall be entered
in the minutes of the governing body of the City.
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(c) Selection of Bonds for Redemption. If less than
all Outstanding Bonds.of the same Stated Maturity are to be
redeemed on a redemption date, the Paying Agent/Registrar
shall treat such Bonds as representing the number of Bonds
Outstanding which is obtained by dividing the principal
amount of such Bonds by $5,000 and shall select the Bonds to
be redeemed within such Stated Maturity by lot.
(d) Mandatory Redem tion. The Term Bonds are subject
to mandatory redemption, and shall be redeemed in part by
lot prior to their Stated Maturity annually on June 1 in the
years 2004 through 2006, inclusive, with funds in the
Mandatory Redemption Account of the Bond Fund established
herein at par and accrued interest to date of redemption.
(e) Notice of Redemption. Not less than thirty (30)
days prior to a redemption date for the Bonds, (i) a notice
of redemption shall be sent by United States Mail, first
class postage prepaid, in the name of the City and at the
City's expense, to each Holder of a Bond to be redeemed in
whole or in part at the address of the Holder appearing on
the Registration Books at the close of business on the
business day next preceding the date of mailing such notice,
and (ii) a notice of such redemption shall be published
one (1) time in a financial journal or publication of
general circulation in the United States of America carrying
as a regular feature notices of municipal bonds called for
redemption; provided, however, that the failure to send,
mail or receive such notice described in (i) above, or any
defect therein or in the sending or mailing thereof, shall
not affect the validity or effectiveness of the proceedings
for the redemption of any Bond, and the publication of
notice as described in (ii) above shall be the only notice
actually required in connection with or as a prerequisite to
the redemption of any Bonds.
All notices of redemption shall (i) specify the date of
redemption for the Bonds, (ii) identify the Bonds to be
redeemed and, in the case of a portion of the principal
amount to be redeemed, the principal amount thereof to be
redeemed, (iii) state the redemption price, (iv) state that
the Bonds, or the portion of the principal amount thereof to
be redeemed, shall become due and payable on the redemption
date specified, and the interest thereon, or on the portion
of the principal amount thereof to be redeemed, shall cease
to accrue from and after the redemption date, and (v)
specify that payment of the redemption price for the Bonds,
or the principal amount thereof to be redeemed, shall be
made at the principal office of the Paying Agent/Registrar
only upon presentation and surrender thereof by the Holder.
If a Bond is subject by its terms to prior redemption and
has been called for redemption and notice of redemption
thereof has been duly given or waived as provided in Sec-
tion 35, such Bond (or the principal amount thereof to be
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redeemed) shall become due and payable, and interest thereon
shall cease to accrue from and after the redemption date
therefor; provided moneys sufficient for the payment of such
Bonds (or of the principal amount thereof to be redeemed) at
the then applicable redemption price are held for the
purpose of such payment by the Paying Agent/Registrar.
SECTION 5: Registration; Transfer and Exchange of
Bonds. Registration Books relating to the registration,
payment, and transfer or exchange of the Bonds shall at a l l
times be kept and maintained by the City at the principal
office of the Paying Agent/Registrar, as provided herein and
in accordance with the provisions of the Paying
Agent/Registrar Agreement and such rules and regulations as
the City and the Paying Agent/Registrar may prescribe. The
Paying Agent/Registrar shall obtain, record, and maintain in
the Registration Books the name and address of each and
every Holder or, if appropriate, the nominee thereof. Any
Bond may, in accordance with its terms and the terms hereof,
be transferred or exchanged for Bonds of other authorized
denominations by the Holder, in person or by his duly
authorized agent, upon surrender of such Bond to the Paying
Agent/Registrar for cancellation, accompanied by a written
instrument of transfer or request for exchange duly executed
by the Holder or by his duly authorized agent, in form
satisfactory to the Paying Agent/Registrar.
Upon surrender for transfer of any Bond at the princi-
pal office of the Paying Agent/Registrar, the Paying
Agent/Registrar shall register and deliver, in the name of
the designated transferee or transferees, one or more new
Bonds of authorized denominations and having the same Stated
Maturity and of a like aggregate principal amount as the
Bond or Bonds surrendered for transfer.
At the option of the Holder, Bonds may be exchanged for
other Bonds of authorized denominations and having the same
Stated Maturity, bearing the same rate of interest and of
like aggregate principal amount as the Bonds surrendered for
exchange, upon surrender of the Bonds to be exchanged at the
principal office of the Paying Agent/Registrar. Whenever
any Bonds are surrendered for exchange, the Paying
Agent/Registrar shall register and deliver new Bonds to the
Holder requesting the exchange.
All Bonds issued in any transfer or exchange of Bonds
shall be delivered to the Holders at the principal office of
the Paying Agent/Registrar, or sent by United States Mail,
first class postage prepaid, to the Holder, and, upon the
delivery thereof, the same shall be valid obligations of the
City, evidencing the same obligation to pay, and entitled to
the same benefits under this Ordinance, as the Bonds surren-
dered in such transfer or exchange.
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All transfers or exchanges of Bonds pursuant to this
Section shall be made without expense or service charge to
any Holder, except as otherwise herein provided, and except
that the Paying Agent/Registrar shall require payment by any
Holder requesting such transfer or exchange of any tax or
other governmental charges required to be paid with respect
to such transfer or exchange.
Bonds cancelled by reason of an exchange or transfer
pursuant to the provisions hereof are hereby defined to be
"Predecessor Bonds", evidencing all or a portion, as the
case may be, of the same obligation to pay evidenced by the
new Bond or Bonds registered and delivered in the exchange
or transfer therefor. Additionally, the term "Predecessor
Bonds" shall include any mutilated, lost, destroyed, or
stolen Bond for which a replacement Bond has been issued,
registered and delivered in lieu thereof pursuant to Sec-
tion 28 hereof and such new replacement Bond shall be deemed
to evidence the same obligation as the mutilated, lost,
destroyed, or stolen Bond.
Neither the City nor the Paying Agent/Registrar shall
be required to transfer or exchange any Bond called for
redemption, in whole or in part, within 45 days of the date
fixed for redemption of such Bond; provided, however, such
limitation on transferability shall not be applicable to an
exchange by the Holder of an unredeemed balance of a Bond
called for redemption in part.
SECTION 6: Execution - Registration. The Bonds shall
be executed on behalf of the City by the Mayor under its
seal reproduced or impressed thereon and countersigned by
the City Secretary. The signature of said officers on the
Bonds may be manual or facsimile. Bonds bearing the manual
or facsimile signatures of individuals who are or were the
proper officers of the City on the Bond Date shall be deemed
to be duly executed on behalf of the City, notwithstanding
that such individuals or either of them shall cease to hold
such offices at the time of delivery of the Bonds to the
initial purchaser(s) and with respect to Bonds delivered in
subsequent exchanges and transfers, all as authorized and
provided in Article 717k-6, V.A.T.C.S., as amended.
No Bond shall be entitled to any right or benefit under
this Ordinance, or be valid or obligatory for any purpose,
unless there appears on such Bond either a certificate of
registration, manually executed by the Comptroller of Public
Accounts of the State of Texas or his duly authorized agent,
or a certificate of registration, manually executed by an
authorized officer, employee or representative of the Paying
Agent/Registrar, substantially in the form provided in
Section 7, and either such certificate upon any Bond duly
signed shall be conclusive -evidence, and the only evidence,
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that such Bond has been duly certified, registered and
delivered.
SECTION 7: Form of Bond. The Bonds, the Registration
Certificate of the Comptroller of Public Accounts of the
State of Texas, the Paying Agent/Registrar's Registration
Certificate, and the form of Assignment to be printed on
each of the Bonds, shall be substantially in the forms set
forth in this Section with such appropriate insertions,
omissions, substitutions, and other variations as are
permitted or required by this Ordinance and may have such
letters, numbers, or other marks of identification (includ-
ing identifying numbers and letters of the Committee on
Uniform Securities Identification Procedures of the American
Bankers Association) and such legends and endorsements
(including any reproduction of an opinion of counsel)
thereon as may, consistently herewith, be established by the
City or determined by the officers executing such Bonds as
evidenced by their execution. Any portion of the text of
any Bonds may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Bond. _
The definitive Bonds shall be printed, lithographed, or
engraved or produced in any other similar manner, all as
determined by the officers executing such Bonds as evidenced
by their execution, but Bonds submitted to the Attorney
General of Texas may be typewritten or photocopied or
otherwise reproduced.
NO.
FORM OF BOND
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF ERATH
CITY OF STEPHENVILLE, TEXAS, UTILITY
SYSTEM REFUNDING REVENUE BOND
SERIES 1988
Bond Date: Interest Rate: Stated Maturity: CUSIP NO.
March 15, 1988
Registered Owner:
Principal Amount:
The City of Stephenville (hereinafter referred to as
the "City"), a body corporate and political subdivision in
the County of Erath, State of Texas, for value received,
hereby promises to pay to the order of the registered owner
named above, or the registered assigns thereof (the
8
"registered owner"), solely from the revenues hereinafter
identified, on the Stated Maturity date specified above, the
Principal Amount stated above (or so much thereof as shall
not have been paid upon prior redemption) and to pay inter-
est on the unpaid Principal Amount hereof from the Bond Date
at the per annum rate of interest specified above; such
interest being payable on June 1 and December 1 in each
year, commencing June 1, 1988. Principal of this Bond is
payable at its Stated Maturity or redemption prior to its
Stated Maturity to the registered owner hereof, upon presen-
tation and surrender, at the principal office of the Paying
Agent/Registrar executing the registration certificate
appearing hereon, or its successor,, interest is payable to
the registered owner of this Bond (or one or more Predeces-
sor Bonds, as defined in the Ordinance hereinafter refer-
enced) whose name appears on the "Registration Books"
maintained by the Paying Agent/Registrar at the close of
business on the "Record Date", which is the 15th day of the
month next preceding each interest payment date. All
payments of principal of, premium, if any, and interest on
this Bond shall be in any coin or currency of the United
States of America which at the time of payment if legal
tender for the payment of public and private debts and
interest shall be paid by the Paying Agent/Registrar by
check sent United States Mail., first class postage prepaid,
to the address of the registered owner recorded in the
Registration Books or by such other method, acceptable to
the Paying Agent/Registrar, requested by, and at the risk
and expense of, the registered owner.
*This Bond is one of a series of bonds issued in the
aggregate principal amount of $7,045,000 (herein referred to
as the "Bonds") for the purpose of refunding certain out-
standing obligations of the City (identified in the Ordi-
nance), under and in strict conformity with the Constitution
and laws of the State of Texas, including Article 717k, as
amended, V.A.T.C.S., and pursuant to an ordinance adopted by
the governing body of the City (herein referred to as the
"Ordinance").
*The Bonds maturing on and after June 1, 1999, may be
redeemed prior to their Stated Maturities, at the option of
the City, in whole or in part in principal amounts of $5,000
of any integral multiple thereof (and if within a Stated
Maturity by lot by the Paying Agent/Registrar), on June 1,
1998, or on any interest payment date thereafter, at the
redemption price of par, together with accrued interest to
the date of redemption.
*The Bonds maturing June 1, 2006 are subject to manda-
tory redemption, and shall be redeemed in part by lot prior
to their Stated Maturity annually on June 1 in the years
2004 through 2006, inclusive, with funds in the Mandatory
Redemption Account of the Bond Fund established in the
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Ordinance, at par and accrued interest to date of redemp-
tion.
*Not less than 30 days prior to the redemption date,
(i) written notice of redemption shall be sent by United
State Mail, first class postage prepaid, to registered
owners of the Bonds to be redeemed, and subject to the terms
and provisions relating thereof contained in the Ordinance
and (ii) a notice of such redemption shall be published one
(1) time in a financial journal or publication of general
circulation in the United State of America carrying as a
regular feature notices of municipal bonds called for
redemption; provided, however, that the failure to send,
mail or receive such notice described in (i) above, or any
defect therein or in the sending or mailing thereof, shall
not affect the validity or effectiveness of the proceedings
for the redemption of any Bond, and the publication of
notice as described in (ii) above shall be the only notice
actually required in connection with or as a prerequisite to
the redemption of any Bonds. If this Bond (or any portion
of the principal sum hereof) shall have been duly called for
redemption and notice of such redemption duly given, then
upon such redemption date this Bond (or the portion of the
principal sum hereof to be redeemed) shall become due and
payable, and interest thereon shall cease to accrue from and
after the redemption date therefor; provided moneys for the
payment of the redemption price and the interest on the
principal amount to be redeemed to the date of redemption
are held for the purpose of such payment by the Paying
Agent/Registrar.
*in the event of a partial redemption of the principal
amount of this Bond, payment of the redemption price of such
principal amount shall be made to the registered owner only
upon presentation and surrender of this Bond to the Paying
Agent/Registrar at its principal office, and there shall be
issued, without charge therefor, to the registered owner
hereof, a new Bond or Bonds of like maturity and interest
rate in any authorized denominations provided in the Ordi-
nance for the then unredeemed balance of the principal sum
hereof. If this Bond is called for redemption, in whole or
in part, the City and the Paying Agent/Registrar shall not
be required to transfer this Bond to an assignee of the
registered owner within 45 days of the redemption date
therefor; provided, however, such limitation on transfer-
ability shall not be applicable to an exchange by the
registered owner of the unredeemed balance hereof in the
event of its redemption in part.
*The Bonds are special obligations of the City, payable
solely from and equally and ratably secured by a first lien
on and pledge of the Net Revenues (as defined in the Ordi-
nance) of the City's Utility System (the "System"). The
Bonds do not constitute a legal or equitable pledge, charge,
10
lien or encumbrance upon any property of the City or the
System, except with respect to the Net Revenues. The holder
hereof shall never have the right to demand payment of this
obligation out of any funds raised or to be raised by
taxation.
*Subject to satisfying the terms and conditions pre-
scribed therefor, the City has reserved the right to issue
additional revenue obligations payable from, and together
with the Bonds equally and ratably secured by a parity lien
on and pledge of, the Net Revenues of the System.
*Reference is hereby made to the Ordinance, a copy of
which is on file in the principal office of the Paying
Agent/Registrar, and to all of the provisions of which the
owner or holder of this Bond by the acceptance hereof hereby
assents, for definition of terms; the description of and the
nature and extent of the security for the payment of the
Bonds; the properties constituting the System; the Net
Revenues pledged to the payment of the principal of and
interest on the Bonds; the nature and extent and manner of
enforcement of the lien and pledge securing the payment of
the Bonds; the terms and conditions for the issuance of
additional revenue obligations; the terms and conditions
relating to the transfer of exchange of this Bond; the
conditions upon which the Ordinance may be amended of
supplemented with or without the consent of the Holders; the
rights, duties, and obligations of the City and the Paying
Agent/Registrar; the terms and provisions upon which the
liens, pledges, charges and covenants made therein may be
discharged at or prior to the maturity or redemption of this
Bond, and this Bond deemed to be no longer Outstanding
thereunder; and for other terms and provisions contained
therein. Capitalized terms used herein have the same
meanings assigned in the Ordinance.
*The Bond, subject to certain limitations contained in
the Ordinance, may be transferred on the Registration Books
only upon its presentation and surrender at the principal
of f ice of the Paying Agent/Registrar, with the Assignment
hereon duly endorsed by, or accompanied by a written instru-
ment of transfer in form satisfactory to the Paying
Agent/Registrar duly executed by, the registered owner
hereof, or his duly authorized agent. When a transfer on
the Registration Books occurs, one or more new fully regis-
tered Bonds of the same Stated Maturity, or authorized
denominations, bearing the same rate of interest, and of the
same aggregate principal amount will be issued by the Paying
Agent/Registrar to the designated transferee or transferees.
*The City and the Paying Agent/Registrar, and any agent
of either, may treat the registered owner hereof whose name
appears on the Registration Books (i) on the Record Date as
the owner entitled to payment of interest hereon, (ii) on
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the date of surrender of this Bond as the owner entitled to
payment of principal hereof at its Stated Maturity or its
redemption, in whole or in part, and (iii) on any other date
as the owner for all other purposes, and neither the City
nor the Paying Agent/Registrar, or any agent of either,
shall be affected by notice to the contrary.
It is hereby certified, recited, represented and
covenanted that the City is a body corporate and political
subdivision duly organized and legally existing under and by
virtue of the Constitution and laws of the State of Texas;
that the issuance of the Bonds is duly authorized by law;
that all acts, conditions and things required to exist and
be done precedent to and in the issuance of the Bonds to
render the same lawful and valid obligations of the City
have been properly done, have happened and have been per-
formed in regular and due time, form and manner as required
by the Constitution and laws of the State of Texas, and the
Ordinance; that the Bonds do not exceed any constitutional
or statutory limitation; and that due provision has been
made for the payment of the principal of and interest on the
Bonds by a pledge of the Net Revenues of the System as
aforestated. In case any provision in this Bond or any
applications shall not in any way be affected or impaired
thereby. The terms and provisions of this Bond and the
Ordinance shall be construed in accordance with and shall be
governed by the laws of the State of Texas.
IN WITNESS WHEREOF, the City Council of the City has
caused this Bond to be duly executed under the official seal
of the City as of the Bond Date.
CITY OF STEPHENVILLE, TEXAS
Mayor
TERSIGNE .
45T_t1_ecretary
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**Form of Registration Certificate of Comptroller
of Public Accounts to Appear on Initial Bond(s) only
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER
OF PUBLIC ACCOUNTS
REGISTER NO.
THE STATE OF TEXAS
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 duly registered by the
Comptroller of Public Accounts of the State of Texas.
WITNESS my signature and seal of office this
Comptroller of Public Accounts
of the State of Texas
(SEAL)
NOTE TO PRINTER:
*Is printed on back of Bonds
**Comptroller Certificate not printed on Bonds
Form of Certificate of Payina Agent/Registrar
to appear on Bonds
PAYING AGENT/REGISTRAR REGISTRATION CERTIFICATE
This Bond has been duly issued and registered in the
name of the Registered Owner shown above under the provi-
sions of the within -mentioned Ordinance; the bond or bonds
of the above entitled and designated series originally
delivered having been approved by the Attorney General of
the State of Texas and registered by the Comptroller of
Public Accounts, as shown by the records of the Paying
Agent/Registrar.
Registration Date:
FIRST INTERSTATE BANK OF TEXAS,
NATIONAL ASSOCIATION, Houston,
Texas as Paying Agent/Registrar
By
13
Authorized Signature
*FORM OF ASSIGNMENT
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells,
assigns, and transfers unto (print or typewrite name,
address, and zip code of transferee:)
(Social Security or other identifying number:
) the within Bond and all rights
thereunder, and hereby irrevocably constitutes and appoints
attorney to transfer the within Bond on the books kept for
registration thereof, with full power of substitution in the
premises.
DATED:
NOTICE: The signature on
this assignment must corres-
pond with the name of the
registered owner as it
appears on the face of the
within Bond in every partic-
ular.
Signature guaranteed:
The printing of a true and correct reproduction of the
final opinion of McCall, Parkhurst & Horton, Dallas, Texas,
approving such Bonds as to their validity, is hereby approv-
ed and authorized.
CUSIP numbers may be printed or typed on the definitive
Bonds. It is expressly provided, however, that the presence
or absence of CUSIP numbers on the definitive Bonds shall be
of no significance or effect as regards the legality thereof
and neither the City nor attorneys approving said Bonds as
to legality are to be held responsible for CUSIP numbers
incorrectly printed or typed on the definitive Bonds.
The City hereby authorizes the printer of the Bonds to
print thereon any statement of insurance with respect to the
Bonds furnished by the municipal bond insurance company
insuring the Bonds, as described in Section 38.
SECTION 8: Reasons for Refunding. The City is issuing
the Bonds for the purpose of refunding the Refunded Obliga-
tions, which shall result in a debt service savings to the
City, enabling the City to delay and reduce anticipated rate
increases for water and sewer services.
14
SECTION 9: Definitions. For all purposes of this
Ordinance and in particular for clarity with respect to the
issuance of the Bonds herein authorized and the pledge and
appropriation of revenues to the payment of the Bonds, the
following definitions are provided.
"Additional Bonds" - Revenue bonds or other
evidences of indebtedness which the City reserves the
right to issue or enter into, as the case may be, in
the future in accordance with the terms and conditions
prescribed therefore and which are equally and ratably
secured by a first lien on and pledge of the Net
Revenues of the System.
"Amortization Installment" — With respect to any
Term Bonds of the Bonds or any series of Additional
Bonds, shall mean the amount of money which is required
to be deposited into the Mandatory Redemption Account
for retirement of such Term Bonds (whether at maturity
or by mandatory redemption and including redemption
premium, if any) provided that the total Amortization
Installments for such Term Bonds shall be sufficient to
provide for retirement of the aggregate principal
amount of such Term Bonds.
"Average Annual Debt Service" - That average
amount which, at the time of computation, will be
required to pay the Debt Service of obligations when
due and derived by'dividing the total of such Debt
Service by the number of complete Fiscal Years then
remaining before final maturity. Capitalized interest
payments provided from bond proceeds shall be excluded
in making the aforementioned computation.
"Bonds" - The "City of Stephenville, Texas,
Utility System Refunding Revenue Bonds, Series 198811,
dated March 15, 1988, authorized by this Ordinance.
"Bonds Similarly Secured" - Collectively, the
Prior Issue, the Bonds and Additional Bonds.
"City" or "Issuer" - The City of Stephenville,
located in the County of Erath, Texas.
"Code" - The Internal Revenue Code of 1986, and
any amendments thereto.
"Debt Service" - As of any particular date of
computation, with respect to any obligations and with
respect to any period, the aggregate of the amounts to
be paid or set aside by the City as of such date or in
such period for the payment of the principal of (in-
cluding Amortization Installments, premium, if any,
and interest (to the extent not capitalized) on such
15
obligations; provided however, if the Additional Bonds
to be issued bear interest at a variable rate of
interest, prior to the issuance of such obligations,
the Director of Finance, subject to the approval of the
governing body of the City, shall determine as of the
date of the adoption of the ordinance authorizing the
issuance of such Additional Bonds:
(a) the maturity schedule of the fixed rate
obligations which would have otherwise been
issued on a schedule normally utilized by the
City in financing improvements, extensions,
or repairs to the System, and
(b) the fixed rate that would have been applica-
ble under market conditions at the time to
such obligations had they been issued and
delivered on such maturity schedule.
The debt service requirements based upon such determi-
nation shall thereafter be considered (including any calcu-
lation thereafter to be made when such Additional Bonds are
considered as Bonds Similarly Secured) as the debt service
requirements with respect to such Additional Bonds.
"Fiscal Year"
used by the City
the System, which
period established
- the twelve month
in connection with
may be any twelve
by the City.
accounting period
the operation of
consecutive month
"Government Obligations" - 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, and United
States Treasury obligations such as its State and Local
Government Series in book -entry form.
"Gross Revenues" - All income, receipts and
revenues of every nature derived or received from the
operation and ownership (excluding refundable meter
deposits, restricted gifts and grants in aid of con-
struction, but including all fees paid to and on
deposit with the City at the start of the Fiscal Year
for access to the System) of the System, including
earnings and income derived from the investment or
deposit of moneys in any special funds or accounts
created and maintained for the payment and security of
the Bonds Similarly Secured and other obligations
payable solely from and secured only by a lien on and
pledge of the Net Revenues.
"Maintenance and Operating Expenses" - All current
expenses of operating and maintaining the System,
including all salaries, labor, materials, repairs and
16
extensions necessary to render efficient service;
provided, however, that only such repairs and exten-
sions, as in the judgment of the City Council, reason-
ably and fairly exercised, are necessary to maintain
the operations of the System and render adequate
service to the City and the inhabitants thereof, or
such as might be necessary to meet some physical
accident or condition which would otherwise impair
obligations payable from Net Revenues shall be deducted
in determining "Net Revenues". Depreciation charges
shall not be considered Maintenance and Operating
Expenses. Maintenance and Operating Expenses shall
include payment under contracts for the purchase of
water supply, treatment of sewage or other materials,
goods or services for the System to the extent author-
ized by law and the provisions of such contract.
"Net Earnings" - The meaning assigned to such term
in Section 18 hereof.
"Net Revenues" - Gross Revenues of the System,
with respect to any period, after deducting the Sys-
tem's Maintenance and Operating Expenses during such
period.
"Outstanding" - When used in this Ordinance with
respect to Bonds means, as of the date of determina-
tion, all Bonds theretofore issued and delivered under
this Ordinance, except:
(1) those Bonds cancelled by the Paying
Agent/Registrar or delivered to the Paying
Agent/Registrar for cancellation;
(2) those Bonds deemed to be paid by the City in
accordance with the provisions of Section 29 hereof by
the irrevocable deposit with the Paying
Agent/Registrar, or an authorized escrow agent, of
money or Government Obligations, or both, in the amount
necessary to fully pay the principal of (including
Amortization Installments), premium, if any, and
interest thereon to maturity or redemption, as the case
may be, provided that, if such Bonds are to be re-
deemed, notice of redemption thereof shall have been
duly given pursuant to this Ordinance or irrevocably
provided to be given to the satisfaction of the Paying
Agent/Registrar, or waived; and
(3) those Bonds that have been mutilated, de-
stroyed, lost, or stolen and replacement Bonds have
been registered and delivered in lieu thereof as
provided in Section 28 hereof.
17
"Paying Agent/Registrar" - The bank, trust compa-
ny, financial institution or other entity so named in
accordance with the provisions of Section 3.
"Prior Issue" - The presently outstanding and
unpaid obligations payable in whole or in part from a
lien on and pledge of the Net Revenues of the System,
more particularly described in the preamble of this
Ordinance; provided, the term Prior Issue shall not
include the Refunded Obligations.
"Refunded Obligations" - The presently outstanding
and unpaid obligations of the City to be refunded with
the proceeds of the Bonds, more particularly described
in the preamble of this Ordinance.
"Required Reserve" - The amount required to be
accumulated and maintained in the Reserve Fund under
the provisions of Section 13.
"System" - All properties, facilities and plants
currently owned, operated and maintained by the City
for the supply, treatment and transmission of treated
potable water, the collection, treatment and disposal
of water -carried wastes and the generation, transmis-
sion and distribution of electricity, together with all
future extensions, improvements, replacements and
additions thereto; provided, however, that notwith-
standing the foregoing, and to the extent now or
hereafter authorized or permitted by law, the term
"System" shall not wean to include facilities of any
kind which are declared not to be a part of the System
and which are acquired or constructed by or on behalf
of the City with the proceeds from the issuance of
"Special Facilities Bonds", which are hereby defined as
being special revenue obligations of the City which are
not Bonds but which are payable from and secured by
other liens on and pledges of any revenues, sources or
payments, not pledged to the payment of the Bonds
including, but not limited to, special contract reve-
nues or payments received from any other legal entity
in connection with such facilities.
"Terra Bonds" - Those Bonds or Additional Bonds so
designated in the ordinances authorizing such bonds
which shall be subject to retirement by operation of
the Mandatory Redemption Account.
If appropriate in the context of this Ordinance, words
of the singular number shall be considered to include the
plural, words of the plural number shall be considered to
include the singular, and words of the masculine, feminine
or neuter gender shall be considered to include the other
genders.
18
SECTION 10: Pledae. That the City hereby covenants
and agrees that the Net Revenues of the System, with the
exception of those in excess of the amounts required for the
payment and security of the Bonds Similarly Secured, are
hereby pledged to the payment and security of the Bonds and
Additional Bonds, if issued, including the establishment and
maintenance of the special funds created and to be main-
tained by this Ordinance, all as hereinafter provided; and
it is hereby ordained that the Bonds Similarly Secured, and
the interest thereon, shall constitute a first lien on the
Net Revenues of the System and be valid and binding without
any physical delivery thereof or further act by the City.
SECTION 11: Utility System Fund. The City hereby
covenants and agrees that Gross Revenues of the System
(excluding earnings and income from investments held for the
benefit of special funds created for the payment and securi-
ty of obligations payable in whole or in part from the Net
Revenues) shall be deposited to the credit of an account
created and maintained by the City and known as the "City of
Stephenville Utility System Fund" (herein called the "System
Fund"). The revenues of the System deposited in the System
Fund shall be pledged and appropriated to the extent re-
quired for the following uses in the order of priority
shown:
FIRST: To the payment of all necessary and
reasonable Maintenance and Operating Expenses of the
System as defined herein or required by statute to be a
first charge on and claim against the Gross Revenues.
SECOND: To the payment of the amounts required
to be deposited in the Bond Fund created and estab-
lished for the payment of Debt Service on the Bonds
Similarly Secured as the same becomes due and payable.
THIRD: To the payment of the amounts required
to be deposited in the Reserve Fund to establish and
maintain the Required Reserve in accordance with the
provisions of this Ordinance or any other ordinance
relating to issuance of Bonds Similarly Secured.
Any Net Revenues remaining in the System Fund after
satisfying the foregoing payments, or making adequate and
sufficient provision for the payment thereof, may be appro-
priated and used for any other City purpose now or hereafter
permitted by law.
SECTION 12: Bond Fund. For purposes of providing
funds to pay the principal of and interest on the Bonds
Similarly Secured as the same becomes due and payable, the
City agrees to create and maintain a separate and special
account or fund known as the "City of Stephenville Interest
and Sinking Revenue Bond Fund" (the "Bond Fund"). The City
19
rW r
covenants that there shall be deposited to the credit of the
Bond Fund prior to each principal and interest payment date
from the Net Revenues an amount equal to one hundred per
centum (100%) of the amount required to fully pay the
interest on and the principal of the Bonds then falling due
and payable, such deposits to pay maturing principal (in-
cluding Amortization Installments) and accruing interest on
the Bonds to be made in substantially equal monthly install-
ments on or before the 15th day of each month, beginning on
or before the 15th day of the month next following the month
the Bonds are delivered to the initial purchaser(s).
The required monthly deposits to the Bond Fund for the
payment of principal of and interest on the Bonds shall
continue to be made as hereinabove provided until such time
as (i) the total amount on deposit in the Bond Fund and
Reserve Fund is equal to the amount required to fully pay
and discharge all Outstanding Bonds Similarly Secured
(principal, including Amortization Installments, and inter-
est) or (ii) the Bonds are no longer Outstanding.
There is hereby created within the Bond Fund a special
account hereby designated the "Mandatory Redemption Ac-
count". As Amortization Installments for the Term Bonds of
the Bonds scheduled to mature on June 1, 2006, there shall
be deposited to the credit of the Mandatory Redemption
Account on or before the 15th day of each month commencing
June 15, 2003 and continuing through May 15, 2006, 1/ 12th of
the respective annual amounts as follows:
Twelve Month Period
Ending May 15
2004
2005
2006*
*Maturity
Amortization Installment
$720,000
775,000
845,000
The City shall redeem Term Bonds of the Bonds on June 1 of
each of the years 2004 through 2006, inclusive, selected by
lot, or purchase in the open market Bonds of the same
maturity, in amounts no less than that which will exhaust
all monies required by this Ordinance to be credited to the
Mandatory Redemption Account during the 12 months period
preceding June 1. The City shall apply the monies in the
Mandatory Redemption Account to the retirement of the Term
Bonds required to be retiredby mandatory redemption under
the provisions hereof, by either redemption in accordance
herewith or prior purchase in the open market at a price not
exceeding the redemption price. On the Stated Maturity of
any Terra Bonds, the City shall apply the monies on hand in
the Mandatory Redemption Account for the payment of the
principal of maturing Terra Bonds,,
Wk
SECTION 13: Reserve Fund. For purposes of accumulat-
ing and maintaining funds as a reserve for the payment of
the Bonds Similarly Secured, the City agrees and covenants
to create a separate and special fund or account to be know
as the "City of Stephenville Revenue Bond Reserve Fund" (the
"Reserve Fund"), and all funds deposited to the credit of
said Fund (excluding earnings and income derived or received
from investments which may be transferred to the System Fund
during such periods as there is on deposit in the Reserve
Fund the Required Reserve) shall be used solely for the
payment of the principal of and interest on the Bonds
Similarly Secured, when and to the extent an amount is not
required for the maintenance of the Required Reserve, such
excess amount may also be used to pay, or provide for the
payment of, the final principal amount of a series of Bonds
Similarly Secured so that such series of Bonds Similarly
Secured is no longer deemed to be "Outstanding" within the
meaning of Section 29 hereof.
The total amount to be accumulated and maintained in
the Reserve Fund by reason of the issuance of the Bonds
shall be $888,451 (the "Required Reserve"). Simultaneously
with the delivery of the Bonds to the initial purchaser(s)
thereof, the City shall deposit to the credit of the Reserve
Fund an amount equal to at least $460,,000 (the "Initial
Deposit") from the proceeds of sale of the Bonds. Addition-
ally, on or before the 15th day of the month next following
the delivery of the Bonds to the initial purchasers and on
or before the last day of each month thereafter until the
Required Reserve has been fully accumulated, the City agrees
to deposit, from sources other than Bond proceeds, a sum
equal to 1/60th of the difference between the Required
Reserve and the Initial Deposit.
As and when Additional Bonds are delivered or incurred,
the Required Reserve shall be increased, if required, to an
amount equal to not less than the Average Annual Debt
Service (calculated on a Fiscal Year basis) for all Bonds
Similarly Secured then outstanding, as determined on the
date the last series of Additional Bonds are delivered or
incurred, as the case may be. Any additional amount re-
quired to be maintained in the Reserve Fund shall be so
accumulated by the deposit in the Reserve Fund of all or any
part thereof in cash immediately after the delivery of the
then proposed Additional Bonds, or, at the option of the
City, by the deposit of monthly installments, made on or
before the 15th day of each month following the month of
delivery of the Additional Bonds, of not less than 1/ 60th of
the additional amount to be maintained in said Fund by
reason of the issuance of the Additional Bonds then being
issued (or 1/ 60th of the balance of the additional amount
not deposited immediately in cash).
21
When and so long as the cash and investments in the
Reserve Fund total not less than the Required Reserve, no
deposits need be made to the credit of the Reserve Fund;
but, if and when the Reserve Fund at any time contains less
than the Required Reserve (other than as the result of the
reissuance of Additional Bonds as provided in the preceding
paragraph), the City covenants and agrees to cure the
deficiency in the Required Reserve by resuming monthly
deposits to said Fund from the Net Revenues of the System,
such monthly deposits to be in amounts equal to not less
than 1/60th of the then total Required Reserve to be main-
tained in said Fund and made on or before the 15th day of
each month until the total Required Reserve then to be
maintained in said Fund has been fully restored. The City
further covenants and agrees that, subject only to the
payments to be made to the Bond Fund, the Net Revenues shall
be applied and appropriated and used to establish and
maintain the Required Reserve and to cure any deficiency in
such amounts as required by the terms of this Ordinance and
any other ordinance pertaining to the issuance of Additional
Bonds. _
During such time as the Reserve Fund contains the total
Required Reserve, the City may, at its option, withdraw all
surplus in the Reserve Fund in excess of the Required
Reserve and deposit such surplus in the System Fund.
SECTION 14: Depository for Funds; Security. All funds
required to be maintained by the City pursuant to the
provisions of this Ordinance shall be kept at an official
depository of the City and moneys deposited to the credit of
such Funds, to the extent not invested, shall be secured in
the manner prescribed by law for securing other funds of the
City.
SECTION 15: Deficiencies; Excess Net Revenues. (a) If
on any occasion there shall not be sufficient Net Revenues
to make the required deposits into the Bond Fund and the
Reserve Fund, then such deficiency shall be cured as soon as
possible from the next available Net Revenues of the System,
or from any other sources available for such purpose.
(b) Subject to making the required deposits to the
Bond Fund (including the Mandatory Redemption Account) and
the Reserve Fund when and as required by this Ordinance, or
any ordinance authorizing the issuance of Additional Bonds,
the excess Net Revenues may be used by the City for any
lawful purpose.
SECTION 16: Payment of Bonds. While any of the Bonds
are Outstanding, authorized officials of the City shall
cause to be transferred to the Paying Agent/Registrar, from
funds on deposit in the Bond Fund and, if necessary, in the
Reserve Fund, amounts sufficient to fully pay and discharge
22
promptly as each installment
the Bonds accrues or matures
redemption prior to maturity;
made in such manner as will
funds to be deposited with the
close of the business day next
for the Bonds.
)f interest and principal of
or comes due by reason of
such transfer of funds to be
cause immediately available
Paying Agent/Registrar at the
preceding the date of payment
SECTION 17: Investments. Money in any Fund required
to be maintained pursuant to this Ordinance may, at the
option of the City, be placed in time deposits or certifi-
cates of deposit secured (to the extent not insured by the
Federal Deposit Insurance Corporation) by obligations of the
type hereinafter described, or be invested, including
investments held in book -entry form, in direct obligations
of the United States of America, obligations guaranteed or
insured by the United States of America, which, in the
opinion of the Attorney General of the United States, are
backed by its full faith and credit or represent its general
obligations, or invested in indirect obligations of the
United States of America, including, but not limited to,
evidences of indebtedness issued, insured or guaranteed by
such governmental agencies as the Federal Home Loan Banks,
Government National Mortgage Association, Farmers Home
Administration, Federal Home Loan Mortgage Association,
Federal Housing Association, or Participation Certificates
in the Federal Assets Financing Trust; provided that all
such deposits and investments shall be made in such a manner
that the money required to be expended from any fund will be
available at the proper time or times. Such investments
(except State and Local Government Series investments held
in book entry form, which shall at all times be valued at
cost) shall be valued in terms of current market value
within 45 days of the close of each Fiscal Year and, with
respect to investments held for the account of the Reserve
Fund, within 30 days of the date of passage of the ordinance
authorizing the issuance of Additional Bonds. All interest
and income derived from deposits and investments in the Bond
Fund immediately shall be credited to, and any losses
debited to, the Bond Fund. All interest and interest income
derived from deposits in and investments of the Reserve Fund
shall, subject to the limitations provided in Section 13
hereof, be credited to and deposited in the System Fund.
All such investments shall be sold promptly when necessary
to prevent any default in connection with the Bonds Similar-
ly Secured.
SECTION 18: Issuance of Additional Parity Obligations.
Subject to the provisions hereinafter appearing as condi-
tions precedent which must be satisfied, the City reserves
the right to issue, from time to time as needed, Additional
Bonds for any lawful purpose. Such Additional Bonds may be
issued in such form and manner as now or hereafter author-
ized by the laws of the State of Texas for the issuance of
23
evidences of indebtedness or other instruments, and should
new methods or financing techniques be developed that differ
from those now available and in normal use, the City re-
serves the right to employ the same in its financing ar-
rangements provided only that the following conditions
precedent for the authorization and issuance of the same are
satisfied, to -wit:
(1) The City Treasurer of the City (or other
officer of the City then having the primary responsi-
bility for the financial affairs of the City) shall
have executed a certificate stating (a) that, to the
best of his knowledge and belief, the City is not then
in default as to any covenants, obligation or agreement
contained in any ordinance or other proceeding relating
to any obligations of the City payable from and secured
by a lien on and pledge of the Net Revenues of the
System that would materially affect the security or
payment of such obligations and (b) either (i) payments
into all special funds or accounts created and estab-
lished for the payment and security of all outstanding
obligations payable from and secured by a lien on and
pledge of the Net Revenues of the System have been made
and that the amounts on deposit in such special funds
or accounts are the amounts then required to be on
deposit therein or (ii) the application of the proceeds
of sale of such obligations then being issued will cure
any such deficiency.
(2) The Additional Bonds shall be scheduled to
mature or be payable as to principal on June 1 and
December 1 (or both) in each year the same are to be
outstanding or during the term thereof.
(3) The City has secured a certificate or opinion
of a Certified Public Accountant to the effect that.,
according to the books and records of the City, the Net
Earnings, for the preceding Fiscal Year or for a 12
consecutive month period out of the 15 consecutive
months immediately preceding the month the ordinance
authorizing the issuance of the Additional Bonds is
adopted are equal to (a) at least (i) 1.40 times the
Average Annual Debt Service for all Bonds Similarly
Secured then Outstanding and (ii) 1.10 times the
maximum annual Debt Service payment to be paid in a
Fiscal Year for the Bonds Similarly Secured then
Outstanding after giving effect to the issuance of the
Additional. Bonds then being issued, or (b) at least
1.25 times the Average Annual Debt Service of the Bonds
Similarly Secured after giving effect to the issuance
of the proposed Additional Bonds, and in making the
determination of the Net Earnings under this paragraph
(b), the Accountant may take into consideration a
change in the rates and charges for services and
24
facilities afforded by the System that became effective
at least sixty (60) days prior to the last day of the
period for which Net Earnings are determined and, for
purposes of satisfying the above Net Earnings test,
make a pro forma determination of the Net Earnings of
the System for the period of time covered by this
certification or opinion based on such changed in rates
and charges being in effect for the entire period
covered by the Accountant's certificate or opinion.
The foregoing notwithstanding, at such point in time as
there are no longer any bonds of the Prior Issue Outstand-
ing,1 the following condition shall be substituted in lieu of
the condition described in (3) above, to -wit:
"The City has secured a certificate or opinion of
a Certified Public Accountant to the effect that,
according to the books and records of the City, the Net
Earnings, for the preceding Fiscal Year or for a 12
consecutive month period out of the 15 consecutive
months immediately preceding the month the ordinance
authorizing the issuance of the Additional Bonds is
adopted are equal to at least (i) 1.25 times the
Average Annual Debt Service for all Bonds Similarly
Secured then Outstanding and (l*i) 1.10 times the
maximum annual Debt Service payment to be paid in a
Fiscal Year for the Bonds Similarly Secured then
outstanding after giving effect to the issuance of the
Additional Bonds then being issued, and in making the
determination of the Net Earnings under this paragraph,
the Accountant may take into consideration a change in
the rates and charges for services and facilities
afforded by the System that became effective at least
sixty (60) days prior to the last day of the period for
which Net Earnings are determined and, for purposes of
satisfying the above Net Earnings test, make a pro
forma determination of the Net Earnings of the System
for the period of time covered by this certification or
opinion based on such change in rates and charges being
in effect for the entire period covered by the Accoun-
tant's certificate or opinion."
As used in this Section, the term "Net Earnings" shall
mean the Gross Revenues of the System after deducting the
Maintenance and Operating Expenses of the System, but not
depreciation charges or expenditures which, under generally
accepted accounting principles, should be charged to capital
expenditures.
SECTION 19: Refunding Bonds,, The City reserves the
right to issue refunding bonds to refund all or any part of
the outstanding Bonds Similarly Secured (pursuant to any law
then available) upon such terms and conditions as the City
Council of the City may deem to be in the best interest of
25
the City and its inhabitants, and if less than all such
outstanding Bonds Similarly Secured are refunded, the
conditions precedent prescribed (for the issuance of Addi-
tional Bonds) set forth in subparagraph (3) of Section 18
shall be satisfied and the Accountant's certificate or
opinion required in subparagraph (3) shall give effect to
the Debt Service of the proposed refunding bonds (and shall
not give effect to the Debt Service of the Bonds Similarly
Secured being refunded following their cancellation or
provision being made for their payment).
SECTION 20: Obligations of Inferior Lien and Pledge.
The City hereby reserves the right to issue obligations
payable from and secured by a lien on and pledge of the Net
Revenues of the System, junior and subordinate in rank and
dignity to the lien and pledge securing the payment of the
Bonds Similarly Secured, as may be authorized by the laws of
the State of Texas.
SECTION 21: Rates and Charges. That, for the benefit
of the Holders of the Bonds and in addition to all provi-
sions and covenants in the laws of the State of Texas and in
this Ordinance, the City hereby expressly stipulates and
agrees, while any of the Bonds are Outstanding, to establish
and maintain rates and charges for facilities and services
afforded by the System that are reasonably expected, on the
basis of available information and experience, with due
allowance for contingencies, and giving effect to revenues
on hand and budgeted for system expenditures at the begin-
ning of the Fiscal Year to produce Gross Revenues in each
Fiscal Year sufficient:
(1) To pay Maintenance and Operating Expenses,
depreciation charges and replacement and betterment
costs
(2) To produce Net Revenues sufficient to pay the
principal of and interest on the Bonds Similarly
Secured and the amounts required to be deposited in any
reserve or contingency fund created for the payment and
security of the Bonds Similarly Secured, and other
obligations or evidences of indebtedness issued or
incurred that are payable only from and secured solely
by a lien on and pledge of the Net Revenues of the
System, and
(3) To produce Net Revenues equal to at least
1.10 times the Debt Service due and, payable on the
outstanding Bonds Similarly Secured.,
SECTION 22: Maintenance and Operation - Insurance.
The City shall maintain the System in good condition and
operate the System in an efficient manner and at reasonable
cost. While any Bonds are Outstanding, the City agrees to
26
maintain casualty and other insurance on the System of a
kind and in an amount customarily carried by municipal
corporations owning and operating similar properties. The
City is in compliance with all franchises, permits and
authorizations necessary for the operation of the System and
required by any governmental agency; and the City has
obtained or will obtain, and shall keep in full force and
effect while the Bonds are Outstanding, all franchises,
permits, authorizations and approvals required for or with
respect to the operation and maintenance of the System.
SECTION 23: Sale or Lease of Properties. The City, to
the extent and in the manner authorized by law, may sell or
exchange for consideration representing the fair value
thereof, as determined by the City Council of the City, any
property not necessary or required in the efficient opera-
tions of the System, or any equipment not necessary or
useful in the operations thereof or which is obsolete,
damaged or worn out or otherwise unsuitable for use in the
operation of the System. The proceeds of any sale of
properties of the System shall be deposited in the System
Fund.
SECTION 24: Records and Accounts. The City hereby
covenants and agrees that so long as any of the Bonds or any
interest thereon remain Outstanding, it will keep and
maintain separate and complete records and accounts pertain-
ing to the operations of the System in which complete and
correct entries shall be made of all transactions relating
thereto, as provided by Article 1113, V.A.T.C.S., or other
applicable law. The holder or holders of any Bonds Similar-
ly Secured or any duly authorized agent or agents of such
holders shall have the right at all reasonable times to
inspect such records, accounts and date relating thereto,
and to inspect the System and all properties comprising
same. The City further agrees that following the close of
each Fiscal Year, it will cause an audit of such books and
accounts to be made by an independent firm of Certified
Public Accountants. Each such audit, in addition to
whatever other matters may be thought proper by the Accoun-
tant, shall particularly include the following:
(a) A statement of the income and expenses of the
System for such Fiscal Year.
(b) A balance sheet for the System as of the end
of such Fiscal Year.
(c) A statement describing the sources and
applications of funds of the Systems for such Fiscal
Year.
(d) The Accountant's comments regarding the
manner in which the City has carried out the
27
requirements of this Ordinance and any other ordinance
authorizing the issuance of Additional Bonds and his
recommendations for any changes or improvements in the
operations, records and accounts of the System..
(e) A list of insurance policies in f orce at the
end of the Fiscal Year covering the properties of the
System, setting out as to each policy the amount
thereof, the risk covered, the name of the insurer and
the policy's expiration date.
Expenses incurred in making an annual audit of the
operations of the System are to be regarded as Maintenance
and Operating Expenses. Copies of each annual audit shall
be furnished to the Executive Director of the Municipal
Advisory Council of Texas at his office in Austin, Texas,
the City's Financial Advisor and, upon request, to the
original purchaser of the Bonds and subsequent Holders of
any of said Bonds. The audits herein required shall be made
within 120 days following the close of each Fiscal Year
insofar as is possible. _
SECTION 25: Special Covenants, The City further
covenants and agrees by and through this Ordinance as
follows:
(a) It has the lawful power to pledge the Net
Revenues of the System to the payment of the Bonds to
the extent provided herein and has lawfully exercised
said power under the Constitution and laws of the State
of Texas, and that the Bonds issued hereunder, together
with any Additional Bonds shall be ratably secured in
such manner that no one Bond shall have preference over
any other Bond of said issues.
(b) The Net Revenues of the System have not been
in any manner pledged or encumbered to the payment of
any debt or obligation of the City or the System, save
and except for the Prior Issue, other than as made
herein for the payment and security of the Bonds.
(c) That no free services of the System shall be
allowed, and should the City or any of its agents or
instrumentalities make use of the services and facili-
ties of the System, payment of the reasonable value
thereof shall be wade by the City out of funds from
sources other than the revenues and income of the
System.
(d) To the extent that it legally may, the City
further covenants and agrees that, so long as any of
the Bonds or any interest thereon are Outstanding, no
franchise shall be granted for the installation or
operation of any competing waterworks and sewer
28
facilities other than those owned by the City, and the
operation of any such competing system or facilities by
anyone other than this City is hereby prohibited.
SECTION 26: Remedv in Event of Default. In addition
to all rights and remedies provided by the laws of the State
of Texas, the City covenants and agrees particularly that in
the event the City (a) defaults in payments to be made to
the Bond Fund or the Reserve Fund as required by this
Ordinance or (b) defaults in the observance or performance
of any other of the covenants, conditions or obligations set
forth in this Ordinance, the Holder of any of the Bonds
shall be entitled to a writ of mandamus issued by a court of
proper jurisdiction, compelling and requiring the City and
its officers to observe and perform any covenant, condition
or obligation prescribed in this Ordinance. No delay or
omission to exercise any right or power accruing upon any
default shall impair any such right or power, or shall be
construed to be a waiver of any such default or acquiescence
therein, and every such right and power may be exercised
from time to time and as often as may be deemed expedient. _
The specific remedy herein provided shall be cumulative
of all other existing remedies and the specification of such
remedy shall not be deemed to be exclusive.
SECTION 270 Soecial Obligations. The Bonds are
special obligations of the City payable from the pledged Net
Revenues of the System and the Holders thereof shall never
have the right to demand payment thereof out of funds raised
or to be raised by taxation.
SECTION 28: Mutilation. Destroyed; Lost and Stolen
Bonds. In case any Bond shall be mutilated, or destroyed,
lost or stolen, the Paying Agent/Registrar, in its discre-
tion and subject to City approval, may execute and deliver a
replacement Bond of like form and tenor, and in the same
denomination and bearing a number not contemporaneously
outstanding, in exchange and substitution for such mutilated
Bond, or in lieu of and in substitution for such destroyed,
lost or stolen Bond, only upon (i) the f it ing by the Holder
thereof with the Paying Agent/Registrar of evidence satis-
factory to the Paying Agent/Registrar of the destruction,
loss or theft of such Bond, and of the authenticity of the
ownership thereof and (ii) the furnishing to the Paying
Agent/Registrar of indemnification in an amount satisfactory
to hold the City and the Paying Agent/Registrar harmless.
All expenses and charges associated with such indemnity and
with the preparation, execution and delivery of a replace-
ment Bond shall be borne by the Holder of the Bond mutilat-
ed, or destroyed, lost or stolen.
Every replacement Bond issued pursuant to this Section
shall be a valid and binding obligation, and shall be
29
entitled to all the benefits of this Ordinance equally and
ratably with all other Outstanding Bonds, notwithstanding
the enforceability of payment by anyone of the destroyed,
lost, or stolen Bonds.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and reme-
dies with respect to the replacement and payment of mutilat-
ed, destroyed, lost or stolen Bonds.
SECTION 29: Cancellation. All Bonds surrendered for
payment, redemption, transfer, exchange, or replacement, if
surrendered to the Paying Agent/Registrar, shall be promptly
cancelled by it and, if surrendered to the City, shall be
delivered to the Paying Agent/Registrar and, if not already
cancelled, shall be promptly cancelled by the Paying
Agent/Registrar for cancellation any Bonds previously
certified or registered and delivered which the City may
have acquired in any manner whatsoever, and all Bonds so
delivered shall be promptly cancelled by the Paying
Agent/Registrar. All cancelled Bonds held by the Paying
Agent/Registrar shall be destroyed as directed by the City.
SECTION 30: Satisfaction of Obligation of CityG._ If
the City shall pay or cause to be paid, or there shall
otherwise be paid to the Holders, the principal of, premium,
if any, and interest on the Bonds, at the times and in the
manner stipulated in this Ordinance, then the pledge of the
Net Revenues of the System under this Ordinance and all
other obligations of the City to the Holders shall thereupon
cease, terminate, and become void and be discharged and
satisfied.
Bonds or any principal amount(s) thereof shall be
deemed to have been paid within the meaning and with the
effect expressed above in this Section when (i) money
sufficient to pay in full such Bonds or the principal
amount(s) thereof at maturity or to the redemption date
therefor, together with all interest due thereon, shall have
been irrevocably deposited with and held in trust by the
Paying Agent/Registrar, or an authorized escrow agent, or
(ii) Government Obligations shall have been irrevocably
deposited in trust with the Paying Agent/Registrar, or an
authorized escrow agent, which Government Obligations have
been certified by an independent accounting firm to mature
as to principal and interest in such amounts and at such
times as will insure the availability, without reinvestment,
of sufficient money, together with with any moneys deposited
therewith, if any, to pay when. due the principal of and
interest on such Bonds, or the principal amount(s) thereof,
on and prior to the Stated Maturity thereof or (if notice of
redemption has been duly given or waived or if irrevocable
arrangements therefor acceptable to the Paying
Agent/Registrar have been made) the redemption date thereof.
30
The City covenants that no deposit of moneys or Government
Obligations will be made under this Section and no use made
of any such deposit which would cause the Bonds to be
treated as "arbitrage bonds" within the meaning of section
148 of the Code, or regulations adopted pursuant thereto.
Any moneys so deposited with the Paying
Agent/Registrar, or an authorized escrow agent, and all
income from Government Obligations held in trust by the
Paying Agent/Registrar or an authorized escrow agent,
pursuant to this Section which is not required for the
payment of the Bonds, or any principal amount(s) thereof, or
interest thereon with respect to which such moneys have been
so deposited shall be remitted to the City or deposited as
directed by the City. Furthermore, any money held by the
Paying Agent/Registrar for the payment of the principal of
and interest on the Bonds and the remaining unclaimed for a
period of three (3) years after the Stated Maturity, or
applicable redemption date, of the Bonds such moneys were
deposited and are held in trust to pay shall, upon the
request of the City, be remitted to the City against a
written receipt therefor.
SECTION 31: Ordinance a Contract; Amendments., This
Ordinance shall constitute a contract with the Holders from
time to time, be binding on the City, and shall not be
amended or repealed by the City so long as any Bond remains
Outstanding except as permitted in this Section. The City,
may, without the consent of or notice to any Holders, from
time to time and at any time, amend this Ordinance in any
manner not detrimental to the interests of the Holders,
including the curing of any ambiguity, inconsistency, or
formal defect or omission herein. In addition, the City
may, with the written consent of Holders holding a majority
in aggregate principal amount of the Bonds Similarly Secured
then Outstanding affected thereby, amend, add to, or rescind
any of the provisions of this Ordinance; provided that,
without the consent of all Holders of Outstanding Bonds, no
such amendment, addition, or rescission shall(1) extend the
time or times of payment of the principal of, premium, if
any, and interest on the Bonds, reduce the principal amount
thereof, the redemption price therefore, or the rate of
interest thereon, or in any other way modify the terms of
payment of the principal of, premium, if any, or interest on
the Bonds, (2) give any preference to any Bond over any
other Bonds, or (3) reduce the aggregate principal amount of
Bonds required to be held by Holders for consent to any such
amendment, addition or rescission. Nothing in this Ordi-
nance, expressed or implied, is intended or shall be con-
strued to confer upon any person other than the City, the
Paying Agent/Registrar and the Holders, any right, remedy,
or claim, legal or equitable, under or by reason of this
Ordinance or any provisions hereof, this Ordinance and all
its provisions being intended to be and being for the sole
W
and exclusive benefit of the City, the Paying
Agent/Registrar and the Holders.
SECTION 32: Notices to Holders -Waiver. Wherever this
Ordinance provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and sent by United States
Mail, first class postage prepaid, to the address of each
Holder as it appears on the Registration Books.
In any case where notice to Holders is given by mail,
neither the failure to mail such notice to any particular
Holders, nor any defect in any notice so mailed, shall
affect the sufficiency of such notice with respect to all
other Bonds. Where this Ordinance provides for notice in
any manner, such notice may be waived in writing by the
Holder entitled to receive such notice, either before or
after the event with respect to which such notice is given,
and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders shall be filed with the Paying
Agent/Registrar, but such filing shall not be a condition
precedent to the validity of any action taken in reliance
upon such waiver.
SECTION 33: Covenants Regarding Tax Exemption. The
Issuer covenants to take any action to assure, or refrain
from any action which would adversely affect, the treatment
of the Bonds as obligations described in section 103 of the
Internal Revenue Code of 1986 (the "Code"), the interest on
which is not includable in the "gross income" of the holder
for purposes of federal income taxation. In furtherance
thereof, the Issuer covenants as follows:
(a) to take any action to assure that no more
than ten percent of the proceeds of the Bonds (less
amounts deposited to a reserve fund, if any) are used
for any "private business use", as defined in section
141(b) (6) of the Code or, if more than ten percent of
the proceeds are so used, that amounts, whether re-
ceived by the Issuer, with respect to such private
business use, do not, under the terms of this Order or
any underlying arrangement, directly or indirectly,
secure or provide for the payment of more than ten per-
cent of the debt service on the Bonds, in contravention
of section 141(b) (2 ) of the Code;
(b) to take any action to assure that in the
event that the "private business use" described in sub-
section (a) hereof exceeds five percent of the proceeds
of the Bonds (less amounts deposited into a reserve
fund, if any) then the amount in excess of f ive percent
is used for a "private business use" which is "related"
and not "disproportionate", within the meaning of sec-
tion 141(b) (3 ) of the Code, to the governmental use;
32
(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 de-
posited 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 ref rain from taking any action that would
result in the Bonds being "federally guaranteed" within
the meaning of section 14 9 (b) of the Code;
(f) to refrain from using any portion of the pro-
ceeds of the Bonds, directly or indirectly, to acquire
or to replace funds which were used, directly or indi-
rectly, to acquire investment property (as defined in
section 14 8 (b) (2 ) of the Code) which produces a materi-
ally higher yield over the term of the Bonds, other
than investment property acquired with --
(1) proceeds of the Bonds invested for a
reasonable temporary period of three years or less
until such proceeds are needed for the purpose for
which the bonds are issued,
(2) amounts invested in a bona fide debt
service fund, within the meaning of section
1.103-13(b)(12) of the Treasury Regulations, and
(3) amounts deposited in any reasonably re-
quired reserve or replacement fund to the extent
such amounts do not exceed ten percent of the pro-
ceeds of the Bonds;
(g) to otherwise restrict the use of the proceeds
of the Bonds or amounts treated as proceeds of the
Bonds, as may be necessary, so that the Bonds do not
otherwise contravene the requirements of section 148 of
the Code (relating to arbitrage) and, to the extent
applicable, section 149(d) of the Code (relating to
advance refundings) ;
(h) to pay to the United States of America at
least once during each five-year period (beginning on
the date of delivery of the Bonds) an amount that is at
least equal to 90 percent of the "Excess Earnings",
within the meaning of section 148(f) of the Code and to
pay to the United States of America, not later than 60
days after the Bonds have been paid in full, 100
0*1
percent of the amount then required to be paid as a
result of Excess Earnings under section 148(f) of the
Code; and
(i) to maintain such records as will enable the
Issuer to fulfill its responsibilities hereunder and
under section 148 of the Code and to retain such
records for at least six years following the final pay-
ment of principal and interest on the Bonds.
It is the understanding of the Issuer that the covenants
contained herein are intended to assure compliance with the
Code and any regulations or rulings promulgated by the U.S.
Department of the Treasury pursuant thereto. In the event
that regulations or rulings are hereafter promulgated which
modify or expand provisions of the Code, as applicable to
the Bonds, the Issuer will not be required to comply with
any covenant contained herein to the extent that such modi-
fication or expansion, in the opinion of nationally -recog-
nized 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, 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.
(j) The Issuer hereby designates the Bonds as "quali-
fied tax-exempt bonds" as defined in section 2 6 5 (b) (3) of
the Code. In furtherance of such designation, the Issuer
represents, covenants and warrants the following: (i) that
during the calendar year in which the Bonds are issued, the
Issuer (including any subordinate entities) has not desig-
nated nor will designate bonds, which when aggregated with
the Bonds, will result in more than $10,000,000 of "quali-
fied tax-exempt bonds" being issued; (ii) that the Issuer
reasonably anticipates that the amount of tax-exempt obliga-
tions issued during the calendar year in which the Bonds are
issued, by the Issuer (or any subordinate entities) will not
exceed $10,000,000; and (iii) that the Issuer will take such
action or refrain from such action as necessary, and as more
particularly set forth in this Ordinance, in order that the
Bonds will not be considered "private activity bonds" within
the meaning of section 142 of the Code.
SECTION 34: Confirmation of Sale of the Bonds. The
sale of the Bonds to Kirchner Moore & Company (the "Purchas-
er") in accordance with the Purchase Contract, attached
hereto as Exhibit B, is hereby confirmed and the delivery of
the Bonds to the Purchaser shall occur upon payment of the
agreed purchase price as set forth therein. The execution
34
of the Purchase Contract on behalf of this City Council by
the Mayor or Mayor pro-tem of the City is hereby authorized.
It is hereby found and determined that the price and terms
as set forth in such Purchase Contract are the most advanta-
geous and reasonably obtainable by the City, and the repre-
sentations and warranties set forth therein are hereby
found, determined and declared to be true and correct as of
the date hereof*
The City hereby ratifies the use of the "Preliminary
Official Statement" and approves the use of the "Official
Statement" prepared in connection of the sale of the Bonds.
The execution of the Official Statement by the Mayor or
P
Mayor pro-tem of the City is hereby authorized.
Y
SECTION 35: Control and Custo.f Bonds. The Mayor
of the City shall be and is hereby authorized to take and
have charge of all necessary orders and records pending
investigation by the Attorney General of the State of Texas,
including the printing and supply of the Bonds, and shall
take and have charge and control of the Bonds pending their
approval by the Attorney General, the registration thereof
by the Comptroller of Public Accounts and the delivery
thereof to the Purchaser.
Furthermore, the Mayor and City Secretary of the City
and City Treasurer, any one or more of said officials, are
hereby authorized and directed to furnish and execute such
documents relating to the City and its financial affairs as
may be necessary for the issuance of the Bonds, the approval
of the Attorney General and their registration by the
Comptroller of Public Accounts and, together with the City's
financial advisor, bond counsel and the Paying
Agent/Registrar, make the necessary arrangements for the
delivery of the Bonds to the Purchaser.
SECTION 36: Proceeds of Sale. Immediately following
the delivery of the Bonds, a portion of the proceeds from
the sale thereof shall be deposited in immediately available
funds with First RepublicBank Dallas, National Association,
Dallas, Texas (the "Escrow Agent") in accordance with the
"Escrow Agreement" for the purposes of providing for the
full and complete discharge and final payment of the Refund-
ed Obligations and the payment of certain costs and expenses
incurred in connection therewith.
This City Council hereby authorizes the execution of a
"Escrow Agreement" between the City and the Escrow Agent
whereby a special trust fund account is created with the
Escrow Agent for the deposit of the proceeds of sale of the
Bonds and all moneys deposited in said trust fund account
shall be used only to provide for the refunding, discharge
and retirement of the Refunded Obligations, such Escrow
35
Agreement to be in substantially the form attached as
Exhibit C.
The balance of the proceeds of the Bonds received,
which are not required for the complete and full discharge
and payment of the Refunded Obligations and the payment of
certain costs of issuance of the Bonds, shall be immediately
transferred to the City's depository bank, and allocated,
app�cpriated and deposited either to the credit of the Bond
Fund or the Reserve. Fund, as directed by the Mayor on behalf
of the City.
SECTION 37: Notice of Redemption. The City hereby
directs the "Paying Agent/Registrar" for the Refunded
Obligations to send a notice of redemption to the Holders of
the Refunded Obligations, in substantially the form attached
hereto as Exhibit D, in the manner described in the ordi-
nance authorizing the issuance of the Refunded Obligations,
SECTION 38: Municipal,. Bond Insurance. The City
anticipates that a municipal -)ond guaranty insurance policy
will be issued by AMBAC Indemnity Corporation t11AMBAC111
relating to the Bonds. In consideration thereof, the City
agrees to be bound by and comply with the conditions of the
"Commitment for Municipal Bond Insurance" issued by AMBAC.
SECTION 39: Inconsistent Provisions. All ordinances,
orders or resolutions, or parts thereof, which are in
conflict or inconsistent with any provision of this Ordi-
nance, are hereby repealed and cancelled and the provisions
of this Ordinance shall supercede and control as to the
matters contained herein.
SECTION 40: Governing Law. This Ordinance shall be
construed and enforced in accordance with the laws cf the
State of Texas and the United States of America.
SECTION 41: Severability. If any provision of this
Ordinance or the application thereof to any circumstance
shall be held to be invalid, the remainder of this Ordinance
and. the application thereof to other circumstances shall
nevertheless be valid, and this City Council hereby declares
that this Ordinance would have been enacted without such
invalid provision.
SECTION 42: Public Meeting. It is officially found,
determined, and declared that the meeting at which this
Ordinance is adopted was open to the public and public
notice of the time, place, and subject matter of the public
business to be considered at such meeting, including this
Ordinance, was given, all as required by Article 6252-17,
Vernon's Texas Civil Statutes as amended.
36
SECTION 43: Emergency. That the public importance of
this measure and the fact the Bonds must be delivered to the
initial purchasers on April 19, 1988 to accomplish the
refunding constitute and creates an emergency for the
immediate preservation of the public peace, health, or
safety, and an urgent public necessity requiring the suspen-
sion of any rule requiring ordinances to be read and voted
upon at more than one meeting and any such rule or provi-
sions is accordingly suspended and this ordinance is de-
clared to be an emergency measure, and shall take effect and
be in full force immediately from and after its passage on
the date shown below.
PASSED AND ADOPTED, this March 17, 1988.
ATTEST:
Q_."_10 -.44 A -A.00&4 I A A
_ ;3= 04,z 404f�
OOV "i. y Secretary
(City Seal)
37
CITY OF STEPHENVILLE, TEXAS
n
:f
Mayor
EXHIBIT D
NOTICE OF REDEMi"TION
CITY OF STEPHENVILLE, TEXAS UTILITY SYSTEM
REFUNDING AND IMPROVEMENT REVENUE BONDS, SERIES 1985
(Name and address of
registered owner)
THE REGISTRATION BOOKS for said Bonds show that you are
the registered owner of Bond No. , aggregating $
in principal amount, scheduled to mature June 1, _.
NOTICE IS HEREBY GIVEN that the City of Stephenville,
Texas has called for redemption on the date shown below the
outstanding Bonds of the City described as follows:
City of Stephenville, Texas Utility System Refunding
and Improvement Revenue Bonds, Series 1985, dated
October 11 1985, Bonds maturing on June 1 of each of
the years 1996 through 2006, both inclusive, aggregat-
ing $5,930,000; redemption date: June 1, 1995
NOTICE IS FURTHER GIVEN that due and proper arrange-
mealts have been made for provid.: ng First RepublicBank
Dallas, National Association, Dallas, Texas the place of
payment of said Bonds called for redemption, with funds
sufficient to pay the redemption price of the Bonds, being
the principal amount of said Bonds and the interest thereon
to the redemption date. Payment of the redemption price of
the Bonds shall be made only upon presentation and surrender
of the Bonds by you to the place of payment of said Bonds.
In the event said Bonds, or any of them, are not presented
for payment by the date fixed for. their redemption, they
shall not thereafter bear interest.
THIS NOTICE is issued and given pursuant to the redemp-
tion provisions set forth in the ordinance authorizing the
issuance of said Bonds, in accordance with the recitals and
provisions of said Bonds and pursuant to authority of an
ordinance passed by the City Council of the City of
Stephenville on the 17th day of March, 1988.
FIRST REPUBLICBANK DALLAS,
NATIONAL ASSOCIATION
By.
Title: