91-046 ORD CERTIFICATE FOR ORDINANCE
CERTIFICATE FOR ORDINANCE
THE STATE OF TEXAS •
COUNTY OF LANIAR .
CITY OF PARIS •
We, the undersigned officers of said City, hereby certify as follows:
1. The City Council of said City convened in SPECIAL MEETING ON THE 23RD
DAY OF SEPTEMBER, 1991, at the City Hall, and the roll was called of the duly
constituted officers and members of said City Council, to-wit:
George Fisher, Mayor
Don Stzelton, Mayor Pro Tem
Jim Bell
E. W. Booth
Billy Joe Burnett
Emma Smith
Millie Inb am
Mattie Cunningham, City Clerk
and all of said persons were present,
except the following absentees: George Fisher and Don Shelton
thus constituting a quorum. Whe 7eupon, among other business, the following was transacted
at said Meeting: a written
ORDINANCE
AUTHORIZING THE ISSUANCE OF COMBINATION TAX AND UTILITY
SYSTENi REVENUE CERTIFICATES OF OBLIGATION, SERIES 1991
was duly introduced for the consideration of said City Council and read in full. It was then
duly moved and seconded that said Ordinance be passed; and, after due discussion, said
motion carrying with it the passage of said Ordinance, prevailed and carried by the following
vote:
AYES: All members of said City Council shown present above voted "Aye".
NOES: None.
ORDIPdANCE N0. 91-046
ORDINANCE AUTHORIZING THE I3MANCE OF
CITY OF PARIS, TEXAS COMBINATION TAX AND UTILITY SYSTEM REVENUE
CERTIFICATES OF OBLIGATION, SERIES 1991
THE STATE OF TEXAS .
COUNTY OF LAMAR .
CITY OF PARIS .
WHEREAS, the City Council deems it advisable to issue Certificates of Obligation,
in the amount of $3,300,00(}, for paying, in whole or in part, contractual obligations for
improving and extending the City's combined Waterworks and Sewer System, and for paying
all or a portion of the legal, fiscal and engineering fees in connection with this project; and
WHEREAS, the City Council has heretofore, on the 29th day of August, 1991,
adopted an Ordinance authorizing and directing the City Clerk to give notice of intention
to issue Certificates of Obligation; and
WHEREAS, the notice of intention to issue Certificates of Obligation was published
in the Paris News, which is a newspaper of general circulation in said City, in its issues of
September 1, 1991 and September 8, 1991; and
WHEREAS, the City received no petition from the qualified electors of the City
protesting the issuance of such Certificates of Obligation; and
WHEREAS, the Certificates of Obligation hereinafter authorized and designated are
to be issued and delivered for cash pursuant to 271.041 et. seq. of the Local Government
Code.
THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
PARIS, TEXAS, THAT:
Section 1. AMOUNT AND PURPOSE OF THE CERTIFICATES OF
OBLIGATION. The certificate of obligation or certificates of obligation of the City of Paris
(the "Issuer") are hereby authorized to be issued and delivered in the aggregate principal
amount of $3,300,000, for paying, in whole or in part, contractual obligations for improving
and extending the City's combined Waterworks and Sewer System, and for paying all or a
portion of the legal, fiscal and engineering fees in connection with this project; and
Section 2. DESIGNATION OF THE CERTIFICATE OF OBLIGATION. Each
certificate of obligation issued pursuant to this Ordinance shall be designated: "CITY OF
PARIS, TEXAS COMBINATION TAX AND UTILITY SYSTEM REVENUE
CERTIFICATE OF OBLIGATION, SERIES 1991", and initially there shall be issued, sold,
and delivered hereunder a single fully registered certificate of obligation, without interest
coupons, payable in installments of principal (the "Initial Certificate of Obligation"), but the
coupons, payable in installments of principal (the "Initial Certificate of Obligation"), but the
Initial Certificate of Obligation may be assigned and transferred and/or converted into and
exchanged for a like aggregate principal amount of fully registered certificates of obligation,
without interest coupons, having serial maturities, and in the denomination or denominations
of $5,000 or any integral multiple of $5,000, all in the manner hereinafter provided. The
term "Certificates of Obligation" as used in this Ordinance shall mean and include collec-
tively the Initial Certificate of Obligation and all substitute certificates of obligation ex-
changed therefor, as well as all other substitute certificates of obligation and replacement
certificates of obligation issued pursuant hereto, and the term "Certificate of Obligation"
shall mean any of the Certificates of Obligation.
Section 3. INITIAL DATE, DENOMINATION, NUMBER, MATURITIES,
INITIAL REGISTERED OWNER, AND CHARACTERISTICS OF THE INITIAL
CERTIFICATE OF OBLIGATION. (a) The Initial Certificate of Obligation is hereby
authorized to be issued, sold, and delivered hereunder as a single fully registered Certificate
of Obligation, without interest coupons, dated October 15, 1991, in the denomination and
aggregate principal amount of $3,300,000 numbered R-1, payable in annual installments of
principal to the initial registered owner thereof, to-wit: Southwest Securities Incorporated,
or to the registered assignee or assignees of said Certificate of Obligation or any portion or
portions thereof (in each case, the "registered owner"), with the annual instaliments of
principal of the Initial Certificate of Obligation to be payable on the dates, respectively, and
in the principal amounts, respectively, stated in the FORM OF INITIAL CERTIFICATE
OF OBLIGATION set forth in this Ordinance.
(b) 1fie Initial Certificate of Obligation (i) may be prepaid or redeemed prior to the
respective scheduled due dates of installments of principal thereof, (ii) may be assigned and
transferred, (iii) may be converted and exchanged for other Certificates of Obligation, (iv)
shall have the characteristics, and (v) shall be signed and sealed, and the principal of and
interest on the Initial Certificate of Obligation shall be payable, all as provided, and in the
manner required or indicated, in the FORM OF INITIAL CERTIFICATE OF
OBLIGATION set forth in this Ordinance.
Section 4. INTEREST. The unpaid principal balance of the Initial Certificate of
Obligation shall bear interest from the date of the Initial Certificate of Obligation, and will
be calculated on the basis of a 360-day year of twelve 30-day months to the respective
scheduled due dates, or to the respective dates of prepayment or redemption, of the
installments of principal of the Initial Certificate of Obligation, and said interest shall be
payable, all in the manner provided and at the rates and on the dates stated in the FORN1
OF INITIAL CERTIFICATE OF OBLIGATION set forth in this Ordinance.
Section 5. FORM OF INITIAL CERTIFICATE OF OBLIGATION. The form of
the Initial Certificate of Obligation, including the form of Registration Certificate of the
Comptroller of Public Accounts of the State of Texas to be endorsed on the Initial
Certificate of Obligation, shall be substantially as follows:
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FORM OF INITIAL CERTIFICATE OF OBLIGATION
NO. R-1 $3,300,000
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF LAMAR
CITY OF PARIS, TEXAS
COMBINATION TAX AND UTILITY SYSTEM REVENUE
CERTIFICATE OF OBLIGATION
SERIES 1991
The CITY OF PARIS, in Lamar County (the "Issuer"), being a political subdivision
of the State of Texas, hereby promises to pay to
or to the registered assignee or assignees of this Certificate of Obligation or any portion or
portions hereof (in each case, the "registered owner") the aggregate principal amount of
THREE MILLION THREE HUNDRED THOUSAND DOLLARS
in annual installments of principal due and payable on December 15 in each of the years,
and in the respective principal amounts, as set forth in the following schedule:
YEAR A-MOUNT YEAR AMOUNT
1992 $ 70,000 2002 $155,000
1993 75,000 2003 170,000
1994 80,000 2004 180,000
1995 90,000 2005 195,000
1996 95,000 2006 215,000
1997 105,000 2007 230,000
1998 110,000 2008 250,000
1999 120,000 2009 270,000
. 20(}0 130,000 2010 295,000
2001 145,000 2011 320,000
and to pay interest, from the date of this Certir;Icate of Obligation hereinafter stated, on the
balance of each such installment of principal, respectively, from time to time remaining
unpaid, at the rate of 7.00% per annum until June 15, 1992 and thereafter at the rate oi'
8.00% per annum, with said interest being payau;e on December 15, 1991, and semiannualf;,
on each June 15 and December 15 thereafter while this Certificate of Obligation or any
portion hereof is outstanding and unpaid.
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- THE INSTALLMENTS OF PRINCIPAL OF AND THE INTEREST ON this
Certificate of Obligation are payable in lawful money of the United States of America,
without exchange or collection charges. The installments of the principal of and the interest
on this Certificate of Obligation are payable to the registered owner hereof through the
services of NCNB Texas National Bank, Dallas, Texas, which is the "Paying Agent/Registrar"
for this Certificate of Obligation. Payment of all principal of and interest on this Certificate
of Obligation shall be made by the Paying Agent/Registrar to the registered owner hereof
on each principal and/or interest payment date by check or draft, dated as of such date,
drawn by the Paying Agent/Registrar on, and payable solely from, funds of the Issuer
required by the order authorizing the issuance of this Certificate of Obligation (the
"Certificate of Obligation Ordinance") to be on deposit with the Paying Agent/Registrar for
such purpose as hereinafter provided; and such check or draft shall be sent by the Paying
Agent/Registrar by United States mail, first class postage prepaid, on each such principal
and/or interest payment date, to the registered owner hereof, at the address of the registered
owner, as it appeared on the last business day of the month next preceding each such date
(the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as
hereinafter described, or by such other method acceptable to the Paying Agent/Registrar,
requested by, and at the risk and expense of the registered owner. The Issuer covenants
with the registered owner of this Certificate of Obligation that on or before each principal
and/or interest payment date for this Certificate of Obligation it will make available to the
Paying Agent/Registrar, from the "Interest and Sinking Fund" created by the Certificate of
Obligation Ordinance, the amounts required to provide for the payment, in immediately
available funds, of all principal of and interest on this Certificate of Obligation, when due.
IF THE DATE for the payment of the principal of or interest on this Certificate of
Obligation shall be a Saturday, Sunday, a legal holiday, or a day on which banking
institutions in the city where the Paying Agent/Registrar is located are authorized by law or
executive order to close, then the date for such payment shall be the next succeeding day
which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are
authorized to close; and payment on such date shall have the same force and effect as if
made on the original date payment was due.
THIS CERTIFICATE OF OBLIGATION has been authorized in accordance with
the Constitution and laws of the State of Texas in the aggregate principal amount of
$3,300,000, for paying, in whole or in part, contractual obligations for improving and
extending the City's combined Waterworks and Sewer System, and for paying all or a portion
of the legal, fiscal and engineering fees in connection with this project; and
THE UNPAID INSTALLMENTS of principal of this Certificate of Obligation may
be prepaid or redeemed prior to their scheduled due dates, at the option of the Issuer, on
any date from October 15, 1991 to June 15, 1992, and on any date from June 15, 2001 and
thereafter, with funds derived from any available source, as a whole, or in part, and, if in
part, the Issuer shall select and designate the maturity, or maturities, and the amount that
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is to be redeemed, and if less than a whole maturity is to be called, the Issuer shall direct
the Paying Agent/Registrar to call by lot (provided that a portion of this Certificate of
Obligation may be redeemed only in an integral multiple of $5,000), at the prepayment or
redemption price of the principal amount thereof, plus accrued interest to the date fixed for
prepayment or redemption. At least 30 days prior to the date fixed for any such prepayment
or redemption a written notice of such prepayment or redemption shall be mailed by the
Paying Agent/Registrar to the registered owner hereof. By the date fixed for any sucH
prepayment or redemption due provision shall be made by the Issuer with the Paying Agent/Registrar for the payment of the required prepayment or redemption price for this
Certificate of Obligation or the portion hereof which is to be so prepaid or redeemed, plus
accrued interest thereon to the date fixed for prepayment or redemption. If such written
notice of prepayment or redemption is given, and if due provision for such payment is made,
all as provided above, this Certificate of Obligation, or the portion thereof which is to be so
prepaid or redeemed, thereby automatically shall be treated as prepaid or redeemed prior
to its scheduled due date, and shall not bear interest after the date fixed for its prepayment
or redemption, and shall not be regarded as being outstanding except for the right of the
registered owner to receive the prepayment or redemption price plus accrued interest to the
date fiYed for prepayment or redemption from the Paying Agent/Registrar out of the funds
provided for such payment. The Paying Agent/Registrar shall record in the Registration
Books all such prepayments or redemptions of principal of this Certificate of Obligation or
any portion hereof.
THIS CERTIFICATE OF OBLIGAT~ON, to the extent of the unpaid or
unredeemed principal balance hereof, or any unpaid and unredeemed portion hereof in any
integral multiple of $5,000, may be assigned by the initial registered owner hereof and shall
be transferred only in the Registration Books of the Issuer kept by the Paying
Agent/Registrar acting in the capacity of registrar for the Certificates of Obligation, upon
the terms and conditions set forth in the Certificate of Obligation Ordinance. Among other
requirements for such transfer, this Certificate of Obligation must be presented and
surrendered to the Paying Agent/Registrar for cancellation, together with proper instruments
of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/
Registrar, evidencing assignment by the initial registered owner of this Certificate of
Obligation, or any portion or portions hereof in any integral multiple of $5,000, to the
assignee or assignees in whose name or names this Certificate of Obligation or any such
portion or portions hereof is or are to be transferred and registered. Any instrument or
instruments of assignment satisfactory to the Paying Agent/Registrar may be used to
evidence the assignment of this Certificate of Obligation or any such portion or portions
hereof by the initial registered owner hereof. A new certificate of obligation or certificate
of obligations payable to such assignee or as:;ignees (which then will be the new registered
owner or owners of such new Certificate of Obligation or Certificates of Obligation) or to
the initial registered owner as to any portion of this Certificate of Obligation which is not
being assigned and transferred by the initial registered owner, shall be delivered by the
Paying Agent/Registrar in conversion of and exchange for this Certificate of Obligation or
any portion or portions hereof, but solely ia the form and manner as provided in the next
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paragraph hereof for the conversion and exchange of this Certificate of Obligation or any
portion hereof. The registered owner of this Certificate of Obligation shall be deemed and
treated by the Issuer and the Paying Agent/Registrar as the absolute owner hereof for all
purposes, including payment and discharge of liability upon this Certificate of Obligation to
the extent of such payment, and the Issuer and the Paying Agent/Registrar shall not be
affected by any notice to the contrary.
AS PROVIDED above and in the Certificate of Obligation Ordinance, this Certificate
of Obligation, to the extent of the unpaid or unredeemed principal balance hereof, may be
converted into and exchanged for a like aggregate principal amount of fully registered
certific.ate of obligations, without interest coupons, payable to the assignee or assignees duly
designated in writing by the initial registered owner hereof, or to the initial registered owner
as to any portion of this Certificate of Obligation which is not being assigned and transferred
by the initial registered owner, in any denomination or denomin,ations in any integral
multiple of $5,000 (subject to the requirement hereinafter stated that each substitute
certificate of obligation issued in exchange for any portion of this Certificate of Obligation
shall have a single stated principal maturity date), upon surrerrder of this Certificate of
Obligation to the Paying Agent/Registrar for cancellation, all in accordance with the form
and procedures set forth in the Certificate of Obligation Ordinance. If this Certificate of
Oblijation or any portion hereof is assigned and transferred or converted each certificate
of obligation issued in exchange for any portion hereof shall have a single stated principal
maturity date corresponding to the due date of the installment of principal of this Certificate
of Obligation or portion hereof for which the substitute certificate of obligation is being
exchanged, and shall bear interest at the rate applicable to and borne by such installment
of principal or portion thereof. Such certificate of obligations, respectively, shall be subject
to redemption prior to maturity on the same dates and for the same prices as the
corresponding installment of principal of this Certificate of Obligation or portion hereof for
which they are being exchanged. No such certificate of obligation shall be payable in
installments, but shall have only one stated principal maturity date. AS PROVIDED IN
THE CERTIFICATE OF OBLIGATION ORDINANCE, THIS CERTIFICATE OF
OBLIGATION IN ITS PRESENT FORM MAY BE ASSIGNED AND TRANSFERRED
OR CONVERTED ONCE ONLY, and to one or more assignees, but the certificate of
obligations issued and delivered in exchange for this Certificate of Obligation or any portion
hereof may be assigned and transferred, and converted, subsequently, as provided in the
Certificate of Obligation Ordinance. The Issuer shall pay the Paying Agent/Registrar's
standard or customary fees and charges for transferring, converting, and exchanging this
Certificate of Obligation or any portion thereof, but the one requesting such transfer,
conversion, and exchange shall pay any taxes or governmental charges required to be paid
with respect thereto. The Paying Agent/Registrar shall not be required to make any such
assignment, conversion, or exchange (i) during the period commencing with the close of
business on any Record Date and ending with the opening of business on the next following
principal or interest payment date, or, (ii) with respect to any Certificate of Obligation or
portion thereof called for prepayment or redemption prior to maturity, within 45 days prior
to its prepayment or redemption date.
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IN THE EVENT any Paying Agent/Registrar for this Certificate of Obligation is
changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted
in the Certificate of Obligation Ordinance that it promptly will appoint a competent and
legally qualified substitute therefor, and promptly will cause written notice thereof to be
mailed to the registered owner of this Certificate of Obligation.
IT IS HEREBY certified, recited, and covenanted that this Certificate of Obligation
has been duly and validly authorized, issued, and delivered; that all acts, conditions, and
things required or proper to be performed, exist, and be done precedent to or in the
authorization, issuance, and delivery of this Certificate of Obligation have been performed,
existed, and been done in accordance with law; that this Certificate of Obligation is a general
obligation of the Issuer, issued on the full faith and credit thereof; and that ad valorem taxes
sufficient to provide for the payment of the interest on and principal of this Certificate of
Obligation, as such interest comes due, and as such principal matures, have been levied and
ordered to be levied against all taxable property in the Issuer, and have been pledged for
such payment, within the limit prescribed by law, and that this Certificate of Obligation is
additionally secured from surplus revenues of the Issuer's combined Waterworks and Sewer
System, remaining after payment of all operation and maintenance expenses thereof, and
all debt service and reserve requirements and any other payments, and deposits required in
connection with the Issuer's revenue bonds (now or hereafter outstanding), which are
payable from all or any part of the revenues of the Issuer's combined Waterworks and Sewer
System.
BY BECOMING the registered owner of this Certificate of Obligation, the registered
owner thereby acknowledges all of the terms and provisions of the Certificate of Obligation
Ordinance, agrees to be bound by such terms and provisions, acknowledges that the
Certificate of Obligation Ordinance is duly recorded and available for inspection in the offi-
cial minutes and records of the governing body of the Issuer, and agrees that the terms and
provisions of this Certificate of Obligation and the Certificate of Obligation Ordinance
constitute a contract between the registered owner hereof and the Issuer.
IN WITNESS WHEREOF, the Issuer has caused this Certificate of Obligation to be
signed with the manual signature of the Mayor of the Issuer and countersigned with the
manual signature of the City Clerk of the Issuer, has caused the official seal of the Issuer
to be duly impressed on this Certificate of Obligation, and has caused this Certificate of
Obligation to be dated October 15, 1991.
,
Q~_4
C;ty Clerk Ac in _ ayor
SEAL .
7
FORM OF REGISTRATION CERTIFICATE OF THE
COMPTROLLER OF PUBLIC ACCOUNTS:
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO.
I hereby certify that this Certificate of Obligation has been examined, certified as to
validity, and approved by the Attorney General of the State of Texas, and that this
Certificate of Obligation has been registered by the Comptroller of Public Accounts of the
State of Texas.
Witness my signature and seal this
Comptroller of Public Accounts
of the State of Texas
(COMPTROLLER'S SEAL)
Section 6. ADDTTIONAL CHARACTERISTICS OF THE Certificates of Obligation.
Registration and Transfer. (a) The Issuer shall keep or cause to be kept at the principal
corporate trust office of NCNB Texas National Bank, Dallas, Texas (the "Paying
Agent/Registrar") books or records of the registration and transfer of the Certificates of
Obligation (the "Registration Books"), and the Issuer hereby appoints the Paying
Agent/Registrar as its registrar and transfer agent to keep such books or records and make
such transfers and registrations under such reasonable regulations as the Issuer and Paying
Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such transfers
and registrations as herein provided. The Paying Agent/Registrar shall obtain and record
in the Registration Books the address of the registered owner of each Certificate cf
Obligation to which payments with respect to the Certificates of Obligation shall be mailed,
as herein provided; but it shall be the duty of each registered owner to notify the Paying
Agent/Registrar in writing of the address to which payments shall be mailed, and such
interest payments shall not be mailed unless such notice has been given. The Issuer shall
have the right to inspect the Reg-istration Books during regular business hours of the Paying
Agent/Regisirar, but otherwise the Paying Agent/Registrar shall keep the Registration Books
confidential and, unless otherwise required by law, shall not permit their inspection by any
. other entity. Registration of each Certificate of Obligation may be transfened in the
Registration Books only upon presentation and surrender of such Certificate of Obligation
to the Paying Agent/Registrar for transfer of registration and cancellation, together with
proper written instruments of assignment, in form and with guarantee of signatures satis-
factory to the Paying Agent/Registrar, (i) evidencing the assignment of the Certificate of
Obligation, or any portion thereof in any integral multiple of $5,000, to the assignee or as-
signees thereof, and (ii) the right of such assignee or assignees to have the Certificate of
Obligation or any such portion thereof registered in the name of such assignee or assignees.
Upon the assignment and transfer of any Certificate of Obligation or any portion thereof,
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a new substitute Certificate of Obligation or Certificates of Obligation shall be issued in
conversion and exchange therefor in the manner herein provided. The Initial Certificate of
Obli;ation, to the extent of the unpaid or unredeemed principal balance thereof, may be
assigned and transferred by the initial registered ovmer thereof once only, and to one or
more assignees designated in writing by the initial registered owner thereof. All Certificates
of Obligation issued and delivered in conversion of and exchange for the Initial Certificate
of Obligation shall be in any denomination or denominations of any integral multiple of
$5,000 (subject to the requirement hereinafter stated that each substitute Certificate of
Obligation shall have a single stated principal maturity date), shall be in the form prescribed
in the FORM OF SUBSTITLJTE CERTIFICATE OF OBLIGATION set forth in this
Ordinance, and shall have the characteristics, and may be assigned, transferred, and
converted as hereinafter provided. If the Initial Certificate of Obligation or any portion
thereof is assigned and transferred or converted the Initial Certificate of Obligation must be
surrendered to the Paying Agent/Registrar for cancellation, and each Certificate of
Obligation issued in exchange for any portion of the Initial Certificate of Obligation shall
have a single stated principal maturity date, and shall not be payable in installments; and
each such Certificate of Obligation shall have a principal maturiry date corresponding to the
due date of the installment of principal or portion thereof for which the substitute Certificate
of Obligation is being exchanged; and each such Certificate of Obligation shall bear interest
at the single rate applicable to and borne by such installment of principal or portion thereof
for which it is being exchanged. If only a portion of the Initial Certificate of Obligation is
assigned and transferred, there shall be delivered to and registered in the name of the initial
registered owner substitute Certificates of Obligation in exchange for the unassigned balance
of the Initial Certificate of Obligation in the same manner as if -the initial registered owner
were the assignee thereof. If any Certificate of Obligation or portion thereof other than the
Initial Certificate of Obligation is assigned and transferred or converted each Certificate of
Obligation issued in exchange therefor shall have the same principal maturity date and bear
interest at the same rate as the Certificate of Obligation for which it is exchanged. A form
of assignment shall be printed or endorsed on each Certificate of Obligation, excepting the
Initial Certificate of Obligation, which shall be executed by the registered owner or its duly
authorized attorney or representative to evidence an assignment thereof. Upon surrender
of any Certificates of Obligation or any portion or portions thereof for transfer of
registration, an authorized representative of the Paying Agent/Registrar shall make such
transfer in the Registration Books, and shall deliver a new fully registered substitute
Certificate of Obligation or Certificates of Obligation, having the characteristics herein des-
cribed, payable to such assignee or assignees (which then will be the registered owner or
owners of such new Certificate of Obligation or Certificates of Obligation), or to the
previous registered owner in case only a portion of a Certificate of Obligation is bein-
assigned and transferred, all in conversion of and exchange for said assigned Certificate of
Obligation or Certificates of Obligation or any portion or portions thereof, in the same form
and manner, and with the same effect, as provided in Section 6(d), below, for the conversion
and exchange of Certificates of Obligation by any registered owner of a Certificate of
Obligation. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees
and charges for making such transfer and delivery of a substitute Certificate of Obligation
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or Certificates of Obligation, but the one requesting such transfer shall pay any taxes or
other governmental charges required to be paid with respect thereto. The Paying
Agent/Registrar shall not be required to make transfers of registration of any Certificate of
Obligation or any portion thereof (i) during the period commencing with the close of
business on any Record Date and ending with the opening of business on the next following
principal or interest payment date, or, (ii) with respect to any Certificate of Obligation or
any portion thereof called for redemption prior to maturity, within 45 days prior to its
redemption date. (b) Ownership of Certificates of Obli a~~tion. The entity in whose name any
Certificate of Obligation shall be registered in the Registration Books at any time shall be
deemed and treated as the absolute owner thereof for all purposes of this Ordinance,
whether or not such Certificate of Obligation shall be overdue, and the Issuer and the Paying
Agent/Registrar shall not be affected by any notice to the contrary; and payment of, or on
account of, the principal of, premium, if any, and interest on any such Certificate of
Obli,-ation shall be made only to such registered owner. All such payments shall be valid
and effectual to satisfy and discharge the liability upon such Certificate of Obligation to the
extent of the sum or sums so paid.
(c) Payment of Certificates of Obligation and Interest. The Issuer hereby further
appoints the Paying Agent/Registrar to act as the paying agent for paying the principal of
and interest on the Certificates of Obligation, and to act as its agent to convert and exchange
or replace Certificates of Obligation, all as provided in this Ordinance. The Paying
Agent/Registrar shall keep proper records of all payments m-ade by the Issuer and the
Payin' Agent/Registrar with respect to the Certificates of Obligation, and of all conversions
and exchanges of Certificates of Obligation, and all replacements of Certificates of
Obligation, as provided in this Ordinance. However, in the event of a nonpayment of interest
on a scheduled payment date, and for thirty (30) days thereafter, a new record date for such
interest payment (a "Special Record Date") will be established by the Paying Agent/Regis-
trar, if and when funds for the payment of such interest have been received from the Issuer.
Notice of the Special Record Date and of the scheduled payment date of the past due
interest (which shall be 15 days after the Special Record Date) shall be sent at least five (5)
business days prior to the Special Record Date by United States mail, first class postage
prepaid, to the address of each Certificate of Obligation holder appearing on the Security
Register at the close of business on the last business day next preceding the date of mailing
of such notice.
(d) Conversion and Exchanize or Replacement; Authentication. Each Certificate of
Obligation issued and delivered pursuant to this Ordinance, to the extent of the unpaid or
unredeemed principal balance or principal amount thereof, may, upon surrender of sucn
Certificate of Obligation at the principal corporate trust office of the Paying Agent/Registrar,
together with a written request therefor duly executed by the registered owner or the
assianee or assignees thereof, or its or their duly authorized attorneys or representatives,
with guarantee of signatures satisfactory to the Paying Agent/Registrar, may, at the option
10
of the registered owner or such assignee or assignees, as appropriate, be converted into and exchanged for fully registered certificate of obligations, without interest coupons, in the form
prescribed in the FORM OF SUBSTITUTE CERTIFICATE OF OBLIGATION set forth
in this Ordinance, in the denomination of $5,000, or any integral multiple of $5,000 (subject
to the requirement hereinafter stated that each substitute Certificate of Obligation shall have
a single stated maturity date), as requested in writing by such registered owner or such
assignee or assignees, in an aggregate principal amount equal to the unpaid or unredeemed
principal balance or principal amount of any Certificate of Obligation or Certificates of
Obligation so surrendered, and payable to the appropriate registered owner, assignee, or
assignees, as the case may be. If the Initial Certificate of Obligation is assigned and
transferred or converted each substitute Certificate of Obligation issued in exchange for any
portion of the Initial Certificate of Obligation shall have a single stated principal maturity
date, and shall not be payable in installments; and each such Certificate of Obligation shall
have a principal maturity date corresponding to the due date of the installment of principal
or portion thereof for which the substitute Certificate of Obligation is being exchanged; and
each such Certificate of Obligation shall bear interest at the single rate applicable to and
borne by such installment of principal or portion thereof for which it is being exchanged.
If a portion of any Certificate of Obligation (other than the Initial Certificate of Obligation)
shall be redeemed prior to its scheduled maturity as provided herein, a substitute Certificate
of Obligation or Certificates of Obligation having the same maturity date, bearing interest
at the same rate, in the denomination or denominations of any integral multiple of $5,000
at the request of the registered owner, and in aggregate principal amount equal to the
unredeemed portion thereof, will be issued to the registered owner upon surrender thereof
for cancellation. If any Certificate of Obligation or portion thereof (other than the Initial
Certificate of Obligation) is assigned and transfened or converted, each Certificate of
Obligation issued in exchange therefor shall have the same principal maturity date and bear
interest at the same rate as the Certificate of Obligation for which it is being exchanged.
Each substitute Certificate of Obligation shall bear a letter and/or number to distinguish it
from each other Certificate of Obligation. The Paying Agent/Registrar shall convert and
exchange or replace Certificates of Obligation as provided herein, and each fully registered
certificate of obligation delivered in conversion of and exchange for or replacement of any
Certificate of Obligation or portion thereof as permitted or req}sired by any provision of this
Ordinance shall constitute one of the Certificates of Obligation for all purposes of this
Ordinance, and may again be converted and exchanged or replaced. It is specifically
provided that any Certificate of Obligation authenticated in conversion of and exchange for
or replacement of another Certificate of Obligation on or prior to the first scheduled Record
Date for the Initial Certificate of Obligation shall bear interest from the date of the Initial
Certificate of Obligation, but each substitute Certificate of Obligation so authenticated after
such first scheduled Record Date shall bear interest from the interest payment date next
preceding the date on which such substitute Certificate of Obligation was so authenticated,
unless such Certificate of Obligation is authenticated after any Record Date but on or before
the next following interest payment date, in which case it shall bear interest from such next
following interest payment date; provided, however, that if at the time of delivery of any
substitute Certificate of Obligation the interest on the Certificate of Obligation for which it
11
is being exchanged is due but has not been paid, then such Certificate of Obligation shall
bear interest from the date to which such interest has been paid in full. THE INITIAL
Certificate of Obligation issued and delivered pursuant to this Ordinance is not required to
be, and shall not be, authenticated by the Paying Agent/Registrar, but on each substitute
Certificate of Obligation issued in conversion of and exchange for or replacement of any
Certificate of Obligation or Certificates of Obligation issued under this Ordinance there shall
be printed a certificate, in the form substantially as follows:
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
It is hereby certified that this Certificate of Obligation has been issued under the
provisions of the Certificate of Obligation Ordinance described on the face of this Certificate
of Obligation; and that this Certificate of Obligation has been issued in conversion of and
exchange for or replacement of a certificate of obligation, certificate of obligations, or a
portion of a certificate of obligation or certificate of obligations of an issue which originally
was approved by the Attorney General of the State of Texas and registered by th?
Comptroller of Public Accounts of the State of Texas.
Paying Agent/Registrar
Dated By
Authorized Representative
An authorized representative of the Paying Agent/Registrar shall, before the delivery of any
such Certificate of Obligation, date and manually sign the above Certificate, and no such
Certificate of Obligation shall be deemed to be issued or outstanding unless such Certificate
is so executed. The Paying Agent/Registrar promptly shall cancel all Certificates of
Obligation surrendered for conversion and exchange or replacement. No additional orders,
orders, or resolutions need be passed or adopted by the governing body of the Issuer or any
other body or person so as to accomplish the foregoing conversion and exchange or replace-
ment of any Certificate of Obligation or portion thereof, and the Paying Agent/Registrar
shall provide for the printing, execution, and delivery of the substitute Certificates of
Obligation in the manner prescribed herein, and said Certificates of Obligation shall be of
type composition printed on paper with lithographed or steel engraved borders of customary
weight and strength. Pursuant to TEX. REV. CIV. STAT. ANN. art. 717k-6 (Vernon, as
amended), and particularly Section 6 thereof, the duty of conversion and exchange or
replacement of Certificates of Obligation as aforesaid is hereby imposed upon the Paying
Agent/Registrar, and, upon the execution of the above Paying Agent/Registrar's
Authentication Certificate, the converted and exchanged or replaced Certificate of
Obligation shall be valid, incontestable, and enforceable in the same manner and with the
same effect as the Initial Certificate of Obligation which originally was issued pursuant to
this Ordinance, approved by the Attorney General, and registered by the Comptroller of
Public Accounts. The Issuer shall pay the Paying Agent/Registrar's standard or customary
12
fees and charges for transferring, converting, and exchanging any Certificate of Obligation
or any portion thereof, but the one requesting any such transfer, conversion, and exchange
shall pay any taxes or governmental charges required to be paid with respect thereto as a
condition precedent to the exercise of such privilege of conversion and exchange. The
Paying Agent/Registrar shall not be required to make any such conversion and exchange or
replacement of Certificates of Obligation or any portion thereof (i) during the period
commencing with the close of business on any Record Date and ending with the opening of
business on the next following principal or interest payment date, or, (ii) with respect to any
Certificate of Obligation or portion thereof called for redemption prior to maturity, within
45 days prior to its redemption date.
(e) In General. All Certificates of Obligation issued in conversion and exchange or
replacement of any other Certificate of Obligation or portion thereof, (i) shall be issued in
fully registered form, without interest coupons, with the principal of and interest on such
Certificates of Obligation to be payable only to the registered owners thereof, (ii) may be
redeemed prior to their scheduled maturities, (iii) may be transferred and assigned, (iv) may
be converted and exchanged for other Certificates of Obligation, (v) shall have the character-
istics, (vi) shall be signed and sealed, and (vii) the principal of and interest on the
Certificates of Obligation shall be payable, all as provided, and in the manner required or
indicated, in the FORM OF SUBSTITUTE CERTIFICATE OF OBLIGATION set forth
in this Ordinance.
Pavment of Fees and Charges. The Issuer hereby covenants with the registered
owners of the Certificates of Obligation that it will (i) pay the standard or customary fees
and charges of the Paying Agent/Registrar for its services with respect to the payment of the
principal of and interest on the Certificates of Obligation, when due, and (ii) pay the fees
and charges of the Paying Agent/Registrar for services with respect to the transfer of
registration of Certificates of Obligation, and with respect to the conversion and exchange
of Certificates of Obligation solely to the extent above provided in this Ordinance.
(g) Substitute Paying Agent/Registrar. The Issuer covenants with the registered
owners of the Certificates of Obligation that at all times while the Certificates of Obligation
are outstanding the Issuer will provide a competent and legally qualified commercial bank
or trust company organized under the laws of the State of Texas or the United States of
America or other entity duly qualified and legally authorized to act as and perform the
. services of Paying Agent/Registrar for the Certificates of Obligation under this Ordinance,
and that the Paying Agent/Registrat will be one entity. The Issuer reserves the right to, and
may, at its option, change the Paying Agent/Registrar upon not less than 120 days written
notice to the Paying Agent/Registrar, to be effective not later than 60 days prior to the next
principal or interest payment date after such notice. In the event that the entity at any time
acting as Paying Agent/Registrar (or its successor by merger, acquisition, or other method)
should resign or otherwise cease to act as such, the Issuer covenants that promptly it will
appoint a competent and legally qualified commercial bank or trust company organized
under the laws of the State of Texas or the United States of America or other entity duly
13
qualified and legally authorized to act as Paying Agent/Registrar under this Ordinance.
Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar
promptly shall transfer and deliver the Registration Books (or a copy thereoo, along with
all other pertinent books and records relating to the Certificates of Obligation, to the new
Paying Agent/Registrar designated and appointed by the Issuer. Upon any change in the
Paying Agent/Registrar, the Issuer promptly will cause a written notice thereof to be sent
by the new Paying Agent/Registrar to each registered owner of the Certificates of Obligation,
by United States mail, first-class postage prepaid, which notice also shall give the address
of the new Paying Agent/ Registrar. By accepting the position and performing as such, each
Paying Agent/Registrar shall be deemed to have agreed to the provisions of this Ordinance,
and a certified copy of this Ordinance shall be delivered to each Paying Agent/Registrar.
Section 7. FORM OF SUBSTITUTE CERTIFICATE OF OBLIGATION. The
form of all Certificates of Obligation issued in conversion and exchange or replacement of
any other Certificate of Obligation or portion thereof, including the form of Paying
Agent/Registrar's Certificate to be printed on each of such Certificates of Obligation, and
the Form of Assignment to be printed on each of the Certificates of Obligation, shall be,
respectiveiy, substantialiy as follows, with such appropriate variations, omissions, or insertions
as are permitted or required by this Ordinance.
FORM OF SUBSTITUTE CERTIFICATE OF OBLIGATION
NO. PRINCIPAL AMOUNT
. $
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF LAMAR
CITY OF PARIS, TEXAS
COMBINATION TAX AND UTILITY SYSTEM REVENUE
CERTIFICATE OF OBLIGATION
SERIES 1991
DATE OF
INTEREST RATE MATURITY DATE ORIGINAL ISSUE CUSIP NO.
7.00% until
June 15, 1992 and
thereafter at the
rate of 8.00% October 15, 1991
ON THE MATU2ITY DATE specified above, CITY OF PAI2IS, in Lamar County,
the "Issuer"), being a political subdivision of the State of Texas, hereby promises to pay to
14
~
or to the registered assignee hereof (either being hereinafter called the "registered owner")
the principal amount of
and to pay interest thereon from October 15, 1991, to the maturity date specified above, or
the date of redemption prior to maturity, with interest being payable on December 15, 1991
and semiannually on each June 15 and December 15 thereafter, at the interest rate per-
annum specified above; except that if the date of authentication of this Certificate of Obligation is later than November 30, 1991, such principal amount shall bear interest from
the interest payment date next preceding the date of authentication, unless such date of
authentication is after any Record Date (hereinafter defined) but on or before the next
following interest payment date, in which case such principal amount shall bear interest from
such next following interest payment date.
THE PRINCIPAL OF AND INTEREST ON this Certificate of Obligation are
payable in lawful money of the United States of America, without exchange or collection
charges. The principal of this Certificate of Obligation shall be paid to the registered owner
hereof upon presentation and sunender of this Certificate of Obligation at maturity or upon
the date fixed for its redemption prior to maturity, at the principal corporate trust office of
NCNB Texas National Bank, Dallas, Texas, which is the "Paying Agent/Registrar" for this
Certificate of Obligation. The payment of interest on this Certificate of Obligation shall be
made by the Paying Agent/Registrar to the registered owner hereof on each interest
payment date by check or draft, dated as of such interest payment date, drawn by the Paying
Agent/Registrar on, and payable solely from, funds of the Issuer required by the order auth-
orizing the issuance of the Certificates of Obligation (the "Certificate of Obligation
Ordinance") to be on deposit with the Paying Agent/Registrar for such purpose as herein-
after provided; and such check or draft shall be sent by the Paying Agent/Registrar by
United States mail, first class postage prepaid, on each such interest payment date, to the
registered owner hereof, at the address of the registered owner, as it appeared on the last
business day of the month next preceding each such date (the "Record Date") on the Regis-
tration Books kept by the Paying Agent/Registrar, as hereinafter described, or by such other
method acceptable to the Paying Agent/Registrar requested by, and at the risk and expense
of, the registered owner. Any accrued interest due upon the redemption of this Certificate
of Obligation prior to maturity as provided herein shall be paid to the registered owner at
the principal corporate trust office of the Paying Agent/Registrar upon presentation and
surrender of this Certificate of Obligation for redemption and payment at the principal
corporate trust office of the Paying Agent/Registrar. The Issuer covenants with the
registered owner of this Certificate of Obligation that on or before each principal payment
date, interest payment date, and accrued interest payment date for this Certificate of
Obligation it will make available to the Paying Agent/Registrar, from the "Interest and
Sinking Fund" created by the Certificate of Obligation Ordinance, the amounts required to
provide for the payment, in immediately available funds, of all principal of and interest on
the Certificates of Obligation, when due.
15
IF THE DATE for the payment of the principal of or interest on this Certificate of
Obligation shall be a Saturday, Sunday, a legal holiday, or a day on which banking
institutions in the city where the Paying Agent/Registrar is located are authorized by law or
executive order to close, then the date for such payment shall be the next succeeding day
which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are
authorized to close; and payment on such date shall have the same force and effect as if
made on the original date payment was due.
THIS CERTIFICATE OF OBLIGATION is one of an issue of Certificates of
Obligation initially dated October 15, 1991, authorized in accordance with the Constitution
and laws of the State of Texas in the principal amount of $3,300,000, for paying, in whole
or in part, contractual obligations for improving and extending the City's combined
Waterworks and Sewer System, and for paying all or a portion of the legal, fiscal and
engineering fees in connection with this project.
THE CERTIFICATES OF OBLIGATION of this Series may be prepaid or
redeemed prior to their scheduled due dates, at the option of the Issuer, on any date from
October 15, 1991 to June 15, 1992, and on any date from June 15, 2001 and thereafter, with
funds derived from any available and lawful source, as a whole, or in part, and, if in part,
the Issuer shall select and designate the maturity or maturities and the amount that is to be
redeemed, and if less than a whole maturity is to be called, the Issuer shall direct the Paying
Agent/Registrar to call by lot (provided that a portion of a Certificate of Obligation may be
redeemed only in an integral multiple of $5,000), at the redemption price of the principal
amount thereof, plus accrued interest to the date fixed for prepayment or redemption. At
least 30 days prior to the date fixed for any redemption of Certificates of Obligation or
portions thereof prior to maturity a written notice of such redemption shall be published
once in a financial publication, journal, or reporter of general circulation among securities
dealers in the City of New York, New York (including, but not limited to, The Bond Buyer
and The Wall Street Journal), or in the State of Texas (including, but not limited to, The
Texas Bond Reporter). Such notice also shall be sent by the Paying Agent/Registrar by
United States mail, first class postage prepaid, not less than 30 days prior to the date fixed
for any such redemption, to the registered owner of each Certificate of Obligation to be
redeemed at its address as it appeared on the 45th day prior to such redemption date;
provided, however, that the failure to send, mail, or receive such notice, or any defect
therein or in the sending or mailing thereof, shall not affect the validity or effectiveness of
the proceedings for the redemption of any Certificate of Obligation, and it is hereby
specifically provided that the publication of such notice as required above shall be the only
notice actually required in connection with or as a prerequisite to the redemption of any
Certificates of Obligation or portions thereof. By the date fixed for any such redemption
due provision shall be made with the Paying Agent/Registrar for the payment of the required
redemption price for the Certificates of Obligation or portions thereof which are to be so
redeemed, plus accrued interest thereon to the date fixed for redemption. If such written
notice of redemption is published and if due provision for such payment is made, all as
provided above, the Certificates of Obligation or portions thereof which are to be so re-
16
deemed thereby automatically shall be treated as redeemed prior to their scheduled
maturities, and they shall not bear interest after the date fixed for redemption, and they shall
not be regarded as being outstanding except for the right of the registered owner to receive
the redemption price plus accrued interest from the Paying Agent/Registrar out of the funds
provided for such payment. If a portion of any Certificate of Obligation shall be redeemed
a substitute Certificate of Obligation or Certificates of Obligation having the same maturity
date, bearing interest at the same rate, in any denomination or denominations in any integral
multiple of $5,000, at the written request of the registered owner, and in aggregate principal
amount equal to the unredeemed portion thereof, will be issued to the registered owner
upon the surrender thereof for cancellation, at the expense of the Issuer, all as provided in
the Certificate of Obligation Ordinance.
THIS CERTIFICATE OF OBLIGATION OR ANY PORTION OR PORTIONS
HEREOF IN ANY IiNTEGRAL MULTIPLE OF $5,000 may be assigned and shall be trans-
ferred only in the Registration Books of the Issuer kept by the Paying Agent/Registrar acting
in the capacity of registrar for the Certificates of Obligation, upon the terms and conditions
set forth in the Certificate of Obligation Ordinance. Among other requirements for such
assignment and transfer, this CertiFcate of Obligation must be presented and surrendered
to the Paying Agent/Registrar, together with proper instruments of assignmen', in form and
with guarantee of signatures satisfactory to the Paying Agent/Registrar, evidt:ncing assign-
ment of this Certificate of Obligation or any portion or portions hereof in any integral
multiple of $5,000 to the assignee or assignees in whose name or names this Certificate of
Obligation or any such portion or portions hereof is or are to be transferred and registered.
The form of Assignment printed or endorsed on this Certificate of Obligation shall be
executed by the registered owner or its duly authorized attorney or representative, to
evidence the assignment hereof. A new Certificate of Obligation or Certificates of
Obligation payable to such assignee or assignees (which then will be the new registered
owner or owners of such new Certificate of Obligation or Certificates of Obligation), or to
the previous registered owner in the case of the assignment and transfer of only a portion
of this Certificate of Obligation, may be delivered by the Paying Agent/Registrar in
conversion of and exchange for this Certificate of Obligation, all in the form and manner as
provided in the next paragraph hereof for the conversion and exchange of other Certificates
of Obligation. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees
and charges for making such transfer, but the one requesting such transfer shall pay any
taxes or other governmental charges required to be paid with respect thereto. The Paying
Agent/Registrar shall not be required to make transfers of registration of this Certificate of
Obligation or any portion hereof (i) during the period commencing with the close of business
on any Record Date and ending with the opening of business on the next following principal
or interest payment date, or, (ii) with respect to any Certificate of Obligation or any portion
thereof called for redemption prior to maturity, within 45 days prior to its redemption date.
The registered owner of this Certificate of Obligation shall be deemed and treated by the
Issuer and the Paying Agent/Registrar as the absolute owner hereof for all purposes,
including payment and discharge of liability upon this Certificate of Obligation to the extent
17
of such payment, and the Issuer and the Paying Agent/Registrar shall not be affected by any
notice to the contrary.
ALL CERTIFICATES OF OBLIGATION OF THIS SERIES are issuable solely as
fully registered certificate of obligations, without interest coupons, in the denomination of
any integral multiple of $5,000. As provided in the Certificate of Obligation Ordinance, this
Certificate of Obligation, or any unredeemed portion hereof, may, at the request of the
registered owner or the assignee or assignees hereof, be converted into and exchanged for
a like aggregate principal amount of fully registered certificate of obligations, without interest
coupons, payable to the appropriate registered owner, assignee, or assignees, as the case may
be, having the same maturity date, and bearing interest at the same rate, in any denomina-
tion or denominations in any integral multiple of $5,000 as requested in writing by the
appropriate registered owner, assignee, or assignees, as the case may be, upon sunender of
this Certificate of Obligation to the Paying Agent/Registrar for cancellation, all in accordance
with the form and procedures set forth in the Certificate of Obligation Ordinance. The
Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for
transferring, converting, and exchanging any Certificate of Obligation or any portion thereof,
but the one requesting such transfer, conversion, and exchange shall pay any taxes or govern-
mental charges required to be paid with respect thereto as a condition precedent to the
exercise of such privilege of conversion and exchange. The Paying Agent/Registrar shall not
be required to make any such conversion and exchange (i) during the period commencing
with the close of business on any Record Date and ending with the opening of business on
the next following principal or interest payment date, or, (ii) with respect to any Certificate
of Obligation or portion thereof called for redemption prior to maturity, within 45 days prior
to its redemption date. IN THE EVENT any Paying Agent/Registrar for the Certificates of Obligation is
changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted
in the Certificate of Obligation Ordinance that it promptly will appoint a competent and
legally qualified substitute therefor, and promptly will cause written notice thereof to be
mailed to the registered owners of the Certificates of Obligation.
IT IS HEREBY certified, recited, and covenanted that this Certificate of Obligation
has been duly and validly authorized, issued, and delivered; that all acts, conditions, and
things required or proper to be performed, exist, and be done precedent to or in the
authorization, issuance, and delivery of this Certificate of Obligation have been performed,
existed, and been done in accordance with law; that this Certificate of Obligation is a general
obligation of the Issuer, issued on the full faith and credit thereof; and that ad valorem taxes
sufficient to provide for the payment of the interest on and principal of this Certificate of
Obligation, as such interest comes due, and as such principal matures, have been levied and
ordered to be levied against all taxable property in the Issuer, and have been pledged for
such payment, within the limit prescribed by law, and that this Certificate of Obligation is
additionally secured from surplus revenues of the Issuer's combined Waterworks and Sewer
System, remaining after payment of all operation and maintenance expenses thereof, and
18
all debt service and reserve requirements and any other payments, and deposits required in
connection with the Issuer's revenue bonds (now or hereafter outstanding), which are
payable &om all or any part of the revenues of the Issuer's combined Waterworks and Sewer
System.
BY BECOMING the registered owner of this Certificate of Obligation, the registered
owner thereby acknowledges all of the terms and provisions of the Certificate of Obligation
Ordinance, agrees to be bound by such terms and provisions, acknowledges that the
Certificate of Obligation Ordinance is duly recorded and available for inspection in the offi-
cial minutes and records of the governing body of the Issuer, and agrees that the terms and
provisions of this Certificate of Obligation and the Certificate of Obligation Ordinance
constitute a contract between each registered owner hereof and the Issuer.
IN WITNESS WHEREOF, the Issuer has caused this Certificate of Obligation to be
signed with the facsimile signature of the Mayor of the Issuer, countersigned with the
facsimile signature of the City Clerk of the Issuer, and has caused the officiai seal of the
Issuer to be duly impressed, or placed in facsimile, on this Certificate of Obligation.
City Clerk
SEAL
FORM OF PAYING AGENT/REGISTR.AR'S AUTHENTIGATION CERTIFICATE
(To be executed if this Certificate of Obligation is not accompanied by an
executed Registration Certificate of the Comptroller of Public Accounts of the
State of Texas)
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIi ICATE
It is hereby certified that this Certificate of Obligation has been issued under the
provisions of the Certificate of Obligation Ordinance described on the face of this Certificate
of Obligation; and that this Certificate of Obligation has been issued in conversion of and
exchange for or replacement of a certificate of obligation, certificate of obligations, or a
portion of a certificate of obligation or certificate of obligations of an issue which originally
was approved by the Attorney General of the State of Texas and registered by the
Comptroller of Public Accounts of the State of Texas.
Dated
Paying Agent/Registrar
By
Authorized Representative
19
FORM OF ASSIGNMENT
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned registered owner of this Certificate of
Obligation, or duly authorized representative or attorney thereof, hereby assigns this
Certificate of Obligation to '
(Assignee's Social Security (print or type Assignee's name
or Taxpayer ldentification Number) and address, including zip code)
and hereby irrevocably constitutes and appoints
attorney to transfer the registration of this Certificate of Obligation on the Paying
Agent/Registrar's Registration Books with full power of substitution in the premises.
Dated
Signature Guaranteed:
NOTICE: This signature must be guaranteed by a member of the New York Stock
Exchange or a commercial bank or trust company.
Registered O,.vner
NOTICE: This signature must correspond with the name. of the Registered Owner
appearing on the face of this Certificate of Obligation in every particular without alteration
or enlargement or any change whatsoever.
Section 8. TAX LEVY. A special Interest and Sinking Fund (the "Interest and
Sinking Fund") is hereby created solely for the benefit of the Certificates of Obligation, and
the Interest and Sinlcing Fund shall be established and maintained by the Issuer at an official
depository bank of the Issuer. The Interest and Sinking Fund shall be kept separate and
apart from all other funds and accounts of the Issuer, and shall be used only for paying the
interest on and principal of the Certificates of Obligation. All ad valorem taxes levied and
collected for and on account of the Certificates of Obligation shall be deposited, as collected,
to the credit of the Interest and Sinking Fund. During each year while any of the
Certificates of Obligation or interest thereon are outstanding and unpaid, the governing body
of the Issuer shall compute and ascertain a rate and amount of ad valorem tax which will
be sufficient to raise and produce the money required to pay the interest on the Certificates
of Obligation as such interest comes due, and to provide and maintain a sinking fund
adequate to pay the principal of the Certificates of Obligation as such principal matures (but
never less than 2% of the original principal amount of the Certificates of Obligation as a
sinking fund each year); and said tax shall be based on the latest approved tax rolls of the
Issuer, with full allowance being made for tax delinquencies and the cost of tax collection.
Said rate and amount of ad valorem tax is hereby levied, and is hereby ordered to be levied,
20
against all taxable property in the Issuer for each year while any of the Certificates oE
Obligation or interest thereon are outstanding and unpaid; and said tax shall be assessed and
collected each such year and deposited to the credit of the aforesaid Interest and Sinking
Fund. Said ad valorem taxes sufficient to provide for the payment of the interest on and
principal of the Certificates of Obligation, as such interest comes due and such principal
matures, are hereby pledged for such payment, within the limit prescribed by law.
Section 9. REVENUES. That said Certificates of Obligation are additionally secured
by and shall be payable from and secured by the revenues of the Issuer's Waterworks and
Sewer System, remaining after payment of all maintenance and operation expenses thereof,
and all debt service, reserve, and other requirements in connection with all of the Issuer's
revenue bonds (which may hereafter be outstanding) which are payable from all or any part
of the Surplus Revenues of the Issuer's Waterworks and Sewer System, constituting "Surplus
Revenues". The Issuer shall deposit such Surplus Revenues to the credit of the Interest and
Sinking Fund created pursuant to Section 8, to the extent necessary to pay the principal and
interest on the Certificates of Obligation. Notwithstanding the requirements of Section 6,
if Surplus Revenues are actually on deposit or budgeted for deposit in the Interest and
Sinking Fund in advance of the time when ad valorem taxes are scheduled to be levied for
any year, then the amount of taxes which otherwise would have been required to be levied
pursuant to Section 8 may be reduced to the extent and by the amount of the Surplus
Revenues then on deposit in the Interest and Sinking Fund or budgeted for deposit therein.
Section 10. TRANSFER. That the Mayor and the City Clerk are hereby ordered
to do any and all things necessary to accomplish the transfer of 'monies to the Interest and
Sinking Fund of this issue in ample time to pay such items of principal and interest.
Section 11. DEFEASANCE OF CERTIFICATES OF OBLIGATION. (a) Any
Certificate of Obligation and the interest thereon shall be deemed to be paid, retired, and
no longer outstanding (a "Defeased Certificate of Obligation") within the meaning of this
Ordinance, except to the extent provided in subsection (d) of this Section, when payment
of the principal of such Certificate of Obligation, plus interest thereon to the due date
(whether such due date be by reason of maturity, upon redemption, or otherwise) either (i)
shall have been made or caused to be made in accordance with the terms thereof (including
the giving of any required notice of redemption), or (ii) shall have been provided for on or
before such due date by irrevocably depositing with or making available to the Paying
Agent/Registrar for such payment (1) lawful money of the United States of America
sufficient to make such payment or (2) Government Obligations which mature as to principal
and interest in such amounts and at such times as will insure the availability, without
reinvestment, of sufficient money to provide for such payment, and when proper arrange-
ments have been made by the Issuer with the Paying Agent/Registrar for the payment of its
services until all Defeased Certificates of Obligation shall have become due and payable.
At such time as a Certificate of Obligation shall be deemed to be a Defeased Certificate of
Obligation hereunder, as aforesaid, such Certificate of Obligation and the interest thereon
shall no longer be secured by, payable from, or entitled to the benefits of, the ad valorem
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, taxes herein levied and pledged as provided in this Ordinance, and such principal and
interest shall be payable solely from such money or Government Obligations.
(b) Any moneys so deposited with the Paying Agent/Registrar may at the written
direction of the Issuer also be invested in Government Obligations, maturing in the amounts
and times as hereinbefore set forth, and all income from such Government Obligations
received by the Paying Agent/ Registrar which is not required for the payment of the
Certificates of Obligation and interest thereon, with respect to which such money has been
so deposited, shall be turned over to the Issuer, or deposited as directed in writing by the
Issuer.
(c) The term "Government Obligations" as used in this Section shall mean direct
obligations of the United States of America, including obligations the principal of and
interest on which are unconditionally guaranteed by the United States of America, which
may be United States Treasury obligations such as its State and Local Government Series,
which may be in book-entry form.
(d) Until all Defeased Certificates of Obligation shall have become due and payable,
the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for such
Defeased Certificates of Obligation the same as if they had not been defeased, and the
Issuer shall make proper arrangements to provide and pay for such services as required by
this Ordinance.
Section 12. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED
CERTIFICATES OF OBLIGATION. (a) Replacement Certificates of Obliization. In the
event any outstanding Certificate of Obligation is damaged, mutilated, lost, stolen, or
destroyed, the Paying Agent/Registrar shall cause to be printed, executed, and delivered, a
new certificate of obligation of the same principal amount, maturity, and interest rate, as the
damaged, mutilated, lost, stolen, or destroyed Certificate of Obligation, in replacement for
such Certificate of Obligation in the manner hereinafter provided.
(b) Application for Replacement Certificates of Obli.ag t~. Application for
replacement of damaged, mutilated, lost, stolen, or destroyed Certificates of Obligation shall
be made by the registered owner thereof to the Paying Agent/Registrar. In every case of
loss, theft, or destruction of a Certificate of Obligation, the registered owner applying for a
replacement certificate of obligation shall furnish to the Issuer and to the Paying
Agent/Registrar such security or indemnity as may be required by them to save each of them
harmless from any loss or damage with respect thereto. Also, in every case of loss, theft,
or destruction of a Certificate of Obiigation, the registered owner shall furnish to the Issue:
and to the Paying Agent/Registrar evidence to their satisfaction of the loss, theft, or
destruction of such Certificate of Obligation, as the case may be. In every case of damage
or mutilation of a Certificate of Obligation, the registered owner shall surrender to the
Paying Agent/Registrar for cancellation the Certificate of Obligation so damaged or muti-
lated.
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(c) No Default Occuned. Notwithstanding the foregoing provisions of this Section,
in the event any such Certificate of Obligation shall have matured, and no default has
occuned which is then continuing in the payment of the principal of, redemption premium,
if any, or interest on the Certificate of Obligation, the Issuer may authorize the payment of
the same (without surrender thereof except in the case of a damaged or mutilated
Certificate of Obligation) instead of issuing a replacement Certificate of Obligation, provided
security or indemnity is furnished as above provided in this Section.
(d) Charg~e for Issuing Replacement Certificates of Obli ag tion. Prior to the issuance
of any replacement certificate of obligation, the Paying Agent/Registrar shall charge the
registered owner of such Certificate of Obligation with all legal, printing, and other expenses
in connection therewith. Every replacement certificate of obligation issued pursuant to the
provisions of this Section by virtue of the fact that any Certificate of Obligation is lost,
stolen, or destroyed shall constitute a contractual obligation of the Issuer whether or not the
lost, stolen, or destroyed Certificate of Obligation shall be found at any time, or be
enforceable by anyone, and shall be entitled to all the benefits of this Ordinance equally and
proportionately with any and all other Certificates of Obligation duly issued under this
Ordinance.
(e) Authoritv for Issuing Replacement Certificates of Obli ag tion. In accordance with
Section 6 of TEX. REV. CIV. STAT. ANN. art. 717k-6 (Vernon, as amended), this Section
of this Ordinance shall constitute authority for the issuance of any such replacement
certificate of obligation without necessity of further action by the governing body of the
issuer or any other body or person, and the duty of the replacement of such certificate of
obligations is hereby authorized and imposed upon the Paying Agent/Registrar, and the
Paying Agent/Registrar shall authenticate and deliver such Certificates of Obligation in the
form and manner and with the effect, as provided in Section 6(d) of this Ordinance for
Certificates of Obligation issued in conversion and exchange for other Certificates of
Obligation.
Section 13. CUSTODY, APPROVAL, AND REGISTRATION OF CERTIFICATES
OF OBLIGATION; BOND COUNSEL'S OPINION; CUSIP NUVIBERS AND
CONTINGENT INSURANCE PROVISION, IF OBTAINED. The Mayor of the Issuer is
hereby authorized to have control of the Initial Certificate of Obligation issued hereunder
and all necessary records and proceedings pertaining to the Initial Certificate of Obligation
pending its delivery and its investigation, examination, and approval by the Attorney General
of the State of Texas, and its registration by the Comptroller of Public Accounts of the State
of Texas. Upon registration of the Initial Certificate of Obligation said Comptroller of
Public Accounts (or a deputy designated in writing to act for said Comptroller) shall
manually sign the Comptroller's Registration Certificate on the Initial Certificate of
Obligation, and the seal of said Comptroller shall be impressed, or placed in facsimile, on
the Initial Certificate of Obligation. The approving legal opinion of the Issuer's Bond
Counsel and the assigned CUSIP numbers may, at the option of the Issuer, be printed on
the Initial Certificate of Obligation or on any Certificates of Obligation issued and delivered
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in conversion of and exchange or replacement of any Certificate of Obligation, but neither
shall have any legal effect, and shall be solely for the convenience and information of the
registered owners of the Certificates of Obligation. In addition, if certificate of obligation
insurance is obtained, the Certificates of Obligation may bear an appropriate legend as
provided by the insurer.
Section 14. COVENANTS REGARDING TAX EXEMPTION. The Issuer covenants
to take any action or refrain from any action which would adversely affect the treatment of
the Certificates of Obligation as obligations described in Section 103 of the Internal Revenue
Code of 1986, as amended, (the "Code"), the interest on which is not includable in the "gross
income" of the holder for purposes of federal income taxation. In furtherance thereof, the
Issuer covenants as follows:
(a) to take any action to assure that no more than 10 percent of the proceeds of
the Certificates of Obligation (less amounts deposited to a reserve fund, if any) are used for
any "private business use," as defined in Section 141(b)(6) of the Code or, if more than 10
percent of the proceeds are so used, that amounts, whether or not received by the Issuer,
with respect to such private business use, do not, under the terms of this Ordinance, or any
underlying arrangement, directly or indirectly, secure or provide for the payment of more
than 10 percent of the debt service on the Certificates of Obligation, in contravention of
Section 141(b)(2) of the Code;
(b) to take any action to assure that in the event that the "private business use"
described in subsection (a) hereof exceeds 5 percent of the proceeds of the Certificates of
Obiigation (less amounts deposited into a reserve fund, if any) then the amount in excess
of 5 percent is used for a"private business use" which is "related" and not "disproportionate,"
within the meaning of Section 141(b)(3) of the Code, to the governmental use;
(c) to tak-- any action to assure that no amount which is greater than the lesser
of $5,000,000, or 5 percent of the proceeds of the Certificates of Obligation (less amounts
deposited into a reserve fund, if any) is directly or indirectly used to finance loans to
persons, other than state or local governmental units, in contravention of Section 141(c) of
the Code;
(d) to refrain from taking any action which would otherwise result in the
Certificates of Obligation being treated as "private activity bonds" within the meaning of
Section 141(b) of the Code;
(e) to refrain from taking any action that would result in the Certificates of
Obligation being "federally guaranteed" within the meaning of Section 149(b) of the Code;
(f) to refrain from using any portion of the proceeds of the Certificates of
Obligation, directly or indirectly, to acquire or to replace funds which were used, directly or
indirectly, to acquire investment property (as defined in Section 148(b)(2) of the Code)
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which praduces a materially higher yield over the term of the Certificates of Obligation,
other than investment property acquired with
(1) proceeds of the Certificates of Obligation invested for a reasonable
temporary period of 3 years or less or, in the case of a refunding bond, for a period
of 30 days or less until such proceeds are needed for the purpose for which the bonds
are issued,
(2) amounts invested in a bona fide debt service fund, within the meaning
of Section 1.103-13(b)(12) of the Treasury Regulations, and
(3) amounts deposited in any reasonably required reserve or replacement
fund to the extent such amounts do not exceed 10 percent of the proceeds of the
Certificates of Obligation; (g) to otherwise restrict the use of the proceeds of the Certificates of Obligation
or arnounts treated as proceeds of the Certificates of Obligation, as may be necessary, so
that the Certificates of Obligation do not otheiwise 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 Certificates of Obligation) an amount that
is at least equal to 90 percent of the "Fxcess 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
Certificates of Obligation have been paid in full, 100 percent of the amount then required
to be paid as a result of Excess Earnings under Section 148(o of the Code; and
(i) to maintain such records as will enable the Issuer to fulfill its responsibilities
under this Section and Section 148 of the Code and to retain such records for at least six
years following the final payment of principal and interest on the Certificates of Obligation.
In order to facilitate compliance with the above covenants (g), (h), and (i), a"Rebate
Fund" is hereby established by the Issuer for the sole benefit of the United States of
America, and such Fund shall not be subject to the claim of any other person, including
without limitation the bondholders. The Rebate Fund is established for the additional
purpose of compliance with Section 148 of the Code.
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 pravisions of the Code, as applicable to the
Certificates of Obligation, the Issuer will not be required to comply with any covenant
contained herein to the extent that such modification or expansion, in the opinion of
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hereafter promulgated which modify, or expand provisions of the Code, as applicable to the
Certificates of Obligation, the Issuer will not be required to comply with any covenant
contained herein to the extent that such modification or expansion, in the opinion of
nationally-recognized bond counsel, will not adversely affect the exemption from federal
income taxation of interest on the Certificates of Obligation under Section 103 of the Code.
In the event that regulations or rulings are hereafter promulgated which impose additional
requirements which are applicable to the Certificates of Obligation, 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 Certificates of Obligation under Section 103 of the Code.
Section 15. SALE OF INTTIAL CERTIFICATE OF OBLIGATION. The Initial
Certificate of Obligation is hereby sold and shall be delivered to Southwest Securities
Incorporated, for the par value thereof and accrued interest thereon to date of delivery.
Section 16. INTEREST EARNINGS ON CERTIFICATES OF OBLIGATION
PROCEEDS. The earnings derived from the investment of proceeds from the sale of the
Certificates of Obligation shall be used along with other Certificate of Obligation proceeds
for the purpose of paying, in whole or in part, the City's contractual obligations for the
for improving and extending the City's combined Waterworks and Sewer System, and for
paying all or a portion of the legal, fiscal and engineering fees in connection with this project
for which the Certificates of Obligation are issued; provided that after completion of such
project, if any of such interest earnings remain on hand, such interest earnings shall be
deposited in the Interest and Sinking Fund.
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hereafter promulgated which modify, or expand provisions of the Code, as applicable to the
Certificates of Obligation, the Issuer will not be required to comply with any covenant
contained herein to the extent that such modification or expansion, in the opinion of
nationally-recognized bond counsel, will not adversely affect the exemption from federal
income taxation of interest on the Certificates of Obligation under Section 103 of the Code.
In the event that regulations or rulings are hereafter promulgated which impose additional
requirements which are applicable to the Certificates of Obligation, 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 Certificates of Obligation under Section 103 of the Code.
Section 15. SALE OF INITIAL CERTIFICATE OF OBLIGATION. The Initial
Certificate of Obligation is hereby sold and shall be delivered to Southwest Securities
Incorporated, for the par value thereof and accrued interest thereon to date of delivery.
Section 16. INTEREST EARNINGS ON CERTIFICATES OF OBLIGATION
PROCEEDS. The earnings derived from the investment of proceeds from the sale of the
Certificates of Obligation shall be used along with other Certificate of Obligation proceeds
for the purpose of paying, in whole or in part, the City's contractual obligations for the
for improving and extending the Ciry's combined Waterworks and Sewer System, and for
paying all or a portion of the legal, fiscal and engineering fees in connection with this project
for which the Certificates of Obligation are issued; provided that after completion of such
project, if any of such interest earnings remain on hand, such, interest earnings shall be
deposited in the Interest and Sinking Fund.
Section 17. This ordinance shall become effective on
September 23, 1491.
Passed an: adopted tfi.is 23rd day of September, 1991',
' ^
'ra el , Acting Mayor
ATTEST:
iattie~Cunning am, City C er
APPROyED AS 0 FORM:
i ^
T. K. aynes, ity Attorney
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