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83-027 ORD CERTIFICATE FOR ORDINANCE ~ ~ E ~ r ~ d CERTIFICATE FOR ORDINANCE ' ~ THE STATE OF TEXAS • ' ~ COUNTY OF LAMAR • ; a ? CITY OF PARIS • ~ ~i We, the undersigned officers of said City, hereby ~ certify as follows: ! 1. The City Council of said City convened in SPECIAL ~ MEETING ON THE 31ST DAY OF MAY,. 1983, at the City Hall, and the roll was called of the duly constituted officers and members of said City Council, to-wit: ? i Joe Graham, Mayor George Fisher, Jr. Nathan Bell Jeff Hoog ~ ' Donald G. Wilson Walter F. Williams ; Harold Green, City Clerk ~ ' and all of said persons were present, except the following ~ ~i absentees : 1l/o k C ~ thus constituting a quorum. Whereupon, among other ~ business, the following was transacted at said Meeting: a~ ~ written ORDINANCE AUTHORIZING THE ISSUANCE OF REVENUE REFUNDING BONDS was duly introduced for the consideration of said City ~ 3 Council and read in full. It was then duly moved and ~ seconded that said Ordinance be passed; and, after due ~ i: discussion, said motion carrying with it the passage of said Ordinance, prevailed and carried by the following vote: ~ ~ AYES: Al1 members of said City Council shown ~ present above voted "Aye". ~ € NOE S: I+Io.PB .(A) ~u-u s i 2. That a true, full and correct copy of the aforesaid Ordinance passed at the Meeting described in the above and i~ foregoing paragraph is attached to and follows this Certifi- cate; that said Ordinance has been duly recorded in said City Council's minutes of said Meeting; that the above and foregoing paragraph is a true, full and correct excerpt from said City Council's minutes of said Meeting pertaining to the passage of said Ordinance; that the persons named in the above and foregoing paragraph are the duly chosen, qualified ' and acting officers and members of said City Council as indicated therein; that each of the officers and members of said City Council was duly and sufficiently notified officially and personally, in advance, of the time, place and purpose of the aforesaid Meeting, and that said Ordinance would be introduced and considered for passage at said Meeting, and each of said officers and members consented, in advance, to the holding of said Meeting for such purpose, and that said Meeting was open to the public ~ and public notice of the time, place and purpose of said j meeting was given, all as required by Vernon's Ann. Civ. St. Article 6252-17. ' ' 3. That the Mayor of said City has approved and hereby approves the aforesaid Ordinance; that the Mayor and the ; City Clerk of said City have duly signed said Ordinance; and that the Mayor and the City Clerk of said City hereby declare that their signing of this Certificate shall constitute the signing of the attached and following copy of said Urdinance for all purposes. SIGNED AND SEALED the 31st day of May, 1983. ~ ~~-.2.~-~---- a C ty Cler yor ~ SEAL t i' a'. ORDINANCE N0. 33-027 ORDINANCE AUTHORIZING THE ISSUANCE OF ; i C I TY OF PARI S WATERWORKS AND SEWER SYSTEM ; ~ REVENUE REFUNDING BONDS, SERIES 1983 ;s THE STATE OF TEXAS . COUNTY OF LAMFiR . CITY OF PARIS • i WHEREAS, the City of Paris, Texas (the "City") has duly issued, and there are now outstanding, pursuant to Vernon's ; Ann. Tex. Civ. St. Articles 1111 through 1118 and other j is applicable laws, the following series or issues oi revenue ~ y: bonds which are secured solely by a lien on and piedge of ~ the net revenues of the City's entire waterworks and sewer ~ ' system: Y`. 1 a' Waterworks and Sewer Revenue Refunding Bonds, i Series 1957, dated January 1, 1957, now out- ; standing in the principal amount of $305, 000 ~ n; Waterworks and Sewer System Revenue Bonds, f' Series 1957-A, dated August 1, 1957, now out- standing in the principal amount of $185,000 ~ Waterworks and Sewer System Revenue Bonds, x { Series 1962, dated October 1, 1962, now out- ~ standing in the principal amount of $130, 000 , Waterworks and Sewer System Revenue Bonds, Series 1973-A, dated January 1, 1973, now out- standing in the principal amount of $145, 000 ' a Waterworks and Sewer System Revenue Bonds, ; Series 1973-B, dated January 1, 1973, now out- ' standing in the principal amount of $220, 000 ~ Waterworks and Sewer System Junior Lien Revenue Bonds, s Series 1966, dated January 10, 1966, now out- standing in the principal amount of $1,820,000; q' (collectively the "Outstanding Bonds"); and ; i: WHEREAS, the Outstanding Bonds are the only bonds or other obligations secured by or payable from the net revenues of the City' s waterworks and sewer system; and WHEREAS, the City has authorized and issued City of ' Paris, Texas Certificates of Obligation, Series 1981, dated April 15, 1981 (the "Outstanding Bonds"); and d WHEREAS, the City Council of the City is the governing ; body of the City; and ~ Y WHEREAS, the refunding bonds hereinafter authorized are to be issued and delivered pursuant to Vernon's Ann. Tex. ? Civ. St. Article 717k, as amended, and other applicable ~ laws, for the purpose of refunding all of the Outstanding Bonds. THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE ; CITY OF PARIS: Y Section 1. BONDS AUTHORIZED. That the City's bonds ~ are hereby authorized to be issued in the principal amount ' Vof $3,110,000, FOR THE PURPOSE OF REFUNDING ALL OF THE OUTSTANDING CITY OF PARIS WATERWORKS AND SEWER SYSTEM ; REVENUE BONDS AND THE CITY OF PARIS, TEXAS CERTIFICATES OF OBLIGATION, SERIES 1981. ~ 4 ~ ~ ~ s ~ i, ~ f y 3 1( i' R£ ~ Y; Section 2. BONDS DESIGNATED. That said bonds shall be ~ ~ designated as the: "CITY OF PARIS WATERWORKS AND SEWER ~ SYSTEM REVENUE REFUNDING BONDS, SERIES 1983" (the "Bonds"). ~ Section 3. DATE AND MATURITIES. That the Bonds shall i be dated June 15, 1983, shall be in the denomination of ~ F' $5,000 each, shall be numbered consecutively from one E upward, and shall mature serially on June 15 of each of the years, and in the amounts, respectively, unless redeemed prior to maturity as required or permitted in the FORM OF ~ BOND set forth in Section 6 of this Ordinance, as set forth in the following schedule: ; 3s YEARS AMOUNTS YEARS AMOUNTS ' p ~ 1a ~ 1984 $ 70,000 1994 $140,000 ~ 1985 70,000 1995 155,000 ~ 1986 75,000 1996 170,000 ` 1987 80,000 1997 185,000 ~ b~ 1988 90,000 1998 200,000 ~ ' 1989 95,000 1999 220,000 ~ 1990 100,000 2000 240,000 ; 1991 110,000 2001 260,000 1992 120,000 2002 285,000 1993 130,000 2003 315,000 ~ 4 ~ Section 4. INTEREST. That the Bonds scheduled to ~ mature during the years, respectively, set forth as follows ~ shall bear interest from the date thereof to maturity or ti ; redemption at the following rates per annum: ! maturity 1984 6.00% maturity 1994 9.00$ ; maturity 1985 6.50$ maturity 1995 9.00g 3 maturity 1986 7.00% maturity 1996 9.10% ~ ° maturity 1987 7.40$ maturity 1997 9.20$ maturity 1988 7.75% maturity 1998 9.30$ a maturity 1989 7.90$ maturity 1999 9.40% ~ maturity 1990 8.00% maturity 2000 9.50$ ; ,f maturity 1991 8.25$ maturity 2001 9.50% ~ maturity 1992 8.50% maturity 2002 9.55$ ~ maturity 1993 8.75% maturity 2003 9.60% ; jj Said interest shall be evidenced by interest coupons which ~ <i shall appertain to the Bonds, and which shall be payable in y the manner provided and on the dates stated in the FORM OF ; 9 BOND set forth in Section 6 of this Ordinance. ~ Section 5. GENERAL CHARACTERISTICS. That the Bonds ' and interest coupons shall be issued, shall be payable, ~ shall and may be redeemed prior to their scheduled maturity, ~ shall have the characteristics, and shall be signed and tl executed (and the Bonds shall be sealed) , all as provided, ~ and in the manner indicated, in the FORM OF BOND set forth in Section 6 of this Ordinance. Section 6. FORMS. That the form of the Bonds, includ- ~ ing the form of Registration Certificate of the Comptroller ~ of Public Accounts of the State of Texas to be printed and endorsed on each of the Bonds, and the form of the aforesaid ; I" interest coupons which shall appertain and be attached initially to each of the Bonds, shall be, respectively, substantially as follows: R P ~ C Ep i i- 2 t W { j ~ Yi ~ , 9 ~ FORM OF BOND ~ NO. $5, 000 ~ s ' UNITED STATES OF AMERICA i STATE OF TEXAS ' ;t COUNTY OF LAMAR ; i! CITY OF PARIS " ~f WATERWORK5 AND SEWER SYSTEM REVENUE REFUNDING BOND ~ SERIES 1983 ~ ON JUNE 15, 19 , THE C I TY OF PAR I S, I N LAMAR COUNTY, ~ TEXAS, hereby promises to pay to bearer hereof the principal ~ amount of i FIVE THOUSAND DOLLARS ; } and to pay interest thereon from the date of this Bond, at ~ ~ the rate of % per annum, evidenced by interest coupons ~ payable June 15, 1984, and semiannually on each December 15 ~ and June 15 thereafter while this Bond is outstanding. ~ THE PRINCIPAL of this Bond and the interest coupons ap- ~ pertaining hereto shall be payable to bgarer, in lawful money of the United States of America, without exchange or e collection charges to the bearer, upon presentation and ± surrender of this Bond or proper interest coupon, at the following, which, collectively, shall constitute and be i. defined as the "Paying Agents" for this Series of Bonds: g ~ LIBERTY NATIONAL BANK IN PARIS, PARIS, TEXAS i, or at the t INTERFIRST BANK DALLAS, N.A., g ; DALLAS, TEXAS r , ~ THIS BOND is one of a Series dated as of June 15, 1983, ; authorized and issued in the principal amount of $3,110,000, ~ ~ FOR THE PURPOSE OF REFUNDING ALL OF THE OUTSTANDING CITY OF ~ ~ PARIS WATERWORKS AND SEWER SYSTEM REVENUE BONDS AND THE CITY ~ ; OF PARIS, TEXAS CERTIFICATES OF OBLIGATION, SERIES 1981. j d j, ON JUNE 15, 1993, or on any interest payment date ~ j thereafter, the outstanding Bonds of this Series may be ; i redeemed prior to their scheduled maturities, at the option f i of said City, with funds derived from any source, in whole, ~ ` or in part, for the principal amount thereof and accrued ; ij interest thereon to the date fixed for redemption, and ! ~ without premium. i ~ ~ AT LEAST thirty days prior to the date fixed for any # ~ prior redemption a written notice of such redemption shall 4 ~ be published at least once in a financial publication ~ published in The City of New York, New York or in the City ~ of Austin, Texas. By the date fixed for any such redemption ~ due provision shall be made with the Paying Agents for the ~ 4 payment of the principal amount of the Bonds which are to be ~ i' so redeemed and accrued interest thereon to the date fixed ~ for redemption. If such written notice of redemption is ~ j; published and if due provision for such payment is made, all ~ as provided above, the Bonds which are to be so redeemed ~ thereby automatically shall be redeemed prior to their scheduled maturities, and they shall not bear interest after iI ' the date fixed for redemption, and they shall not be re- ~ garded as being outstanding except for the right of the ; bearer to receive the redemption price from the Paying ~ Agents out of the funds provided for such payment. ; ; ~ IT IS HEREBY certified, recited, and covenanted that j this Bond has been duly and validly authorized, issued, and „ delivered pursuant to the applicable laws of the State of ~ , Texas, including particularly Vernon's Ann. Tex. Civ. St. ' ~ Article 717k, as amended, and other applicable laws; that ~ all acts, conditions, and things required or proper to be ` i ; ~ 3 3 ~ p~ ga V; 'performed, exist, and be done precedent to or in the author- ization, issuance, and delivery of this Bond and the Series f !of which it is a part have been performed, existed, and been done in accordance with law; that this Bond and the Series ~ = of which it is a part constitute special obligations of said ; I,City, secured by and payable from an irrevocable lien on and ~ pledge of the "Pledged Revenuesas defined in the Bond ~ i Ordinance, which Pledged Revenues incl.ude initially the "Net ` Revenues" of the "System", as such terms are defined in the Bond Ordinance, with the "System" initially consisting of ° ~ the City's entire existing waterworks and sewer system; provided that the "Pledged Revenues" may, in the future, at E± the option of the City, include other revenues, income, or a resources, and with such lien being subject and subordinate ; only to any first lien on and pledge of the "Pledged ° ~i Revenues" hereafter created and made to secure and pay any "Prior Lien Additional Bonds" hereafter issued as permitted in the Bond Ordinance. ~c THE CITY has reserved the right, subject to the ~ restrictions stated in the Bond Ordinance, and without ; a~ obtaining the consent of the holder of this Bond, (1) to ! , issue "Additional Parity Revenue Bonds" designated as ¢ "Additional Bonds" in the Bond Ordinance which also may be ° • secured by and payable from an irrevocable lien on and ~ ; pledge of the aforesaid Pledged Revenues, subject and ; subordinate only to any Prior Lien Additional Bonds hereafter issued, in the same manner and to the same extent ~ as this Bond and the Series of which it is a part, and (2) to issue "Additional Parity Revenue Bonds" designated as "Prior Lien Additional Bonds" in the Bond Ordinance, to be secured by and payable from an irrevocable first lien on and pledge of the Pledged Revenues. THE CITY has reserved the right, subject to the ; restrictions stated in the Bond Ordinance, to amend the Bond i~ Ordinance with the approval of the holders of 51% of the ~ outstanding principal amount of all Bonds and Additional ~a Parity Revenue Bonds. ` BY ACCEPTING THIS BOND the holder hereof acknowledges ~ the terms and provisions of the Bond Ordinance, agrees to be „ bound by such terms and provisions, and acknowledges that ~ ' the Bond Ordinance is duly recorded in the official minutes and records of the City. g 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, or from any source whatsoever other than the Pledged Revenues and other sources described in the Bond ~ ± Ordinance. ~ ~ g ' IN WITNESS WHEREOF, this Bond and the interest coupons ~ ; appertaining hereto have been signed with the facsimile $ ~ signature of the Mayor of said City and countersigned with ~ the facsimile signature of the City Clerk of said City, and ~ the official seal of said City has been duly impressed, or ; placed in facsimile, on this Bond. ' i ~ , i City Clerk, City of Paris Mayor, City of Paris ~ 1 i B a FORM OF REGISTRATION CERTIFICATE: ~ COMPTROLLER' REGISTRATION CERTIFICATE: REGISTER NO. ~ i ~ I hereby certify that this Bond has been examined, cer- s y, and approved by the Attorney General ~ tified as to validit of the State of Texas, and that this Bond has been register- ; E' ed by the Comptroller of Public Accounts of the State of ; Texas. ~ ~ 4 I! ~ I ~y . ~ bG~ l} g. L 't Witness my signature and seal this ~ , Comptroller of Public Accounts ~ of the State of Texas FORM OE INTEREST CO'JPON: ' NO. $ ON 1, 19 THE CITY OF PARIS, IN LAMAR COUNTY, TEXAS, promises to ~ pay to bearer the amount shown on this interest coupon, in ~ lawful money of the United States of America, without ~ exchange or collection charges to the bearer, uniess due ~ provision has been made for the redemption prior to maturity of the Bond to which this interest coupon appertains, upon presentation and surrender of this interest coupon, at the i' LIBERTY NATIONAL BANK IN PARIS, PARIS, TEXAS, or at the INTERFIRST BANK DALLAS, N.A., DALLAS, TEXAS, said amount si being interest due that day on the Bond, bearing the number hereinafter designated, of that issue of CITY OF PARIS ~k WATERWORKS AND SEWER SYSTEM REVENUE REFUND~NG BONDS, SERIES 1983, DATED JUNE 15, 1983. 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, or from any source whatsoever other than the Pledged Revenues and other sources described in the Bond to which this coupon apper- ~ tains. Bond No. City Clerk, City of Paris Mayor, City of Paris Section 7. DEFINITIONS. That as used in this Ordin- ; ~ ance the following terms shall have the meanings set forth ' x below, unless the text hereof specifically indicates other- wise: ; (a) The term "City" shall mean the City of Paris, in ~ Lamar County, Texas. ' ;i (b) The term "City Council" or "Council" shall mean ~s the governing body of the City. , (c) The term "Outstanding Bonds" shall mean the ~ P resently outstanding Waterworks and Sewer System Revenue ; ~j ~ Bonds and Certificates of Obligation of the City described s in the preamble to this Ordinance. ~ ~a (d) The term "Bonds" shall mean the City of Paris f Waterworks and Sewer System Revenue Refunding Bonds, Series ? 1983, authorized by this Ordinance. j (e) The term "Additional Parity Revenue Bonds" shall ' mean the revenue bonds which the City reserves the right to ' ' issue in the future, which revenue bonds may be either `"Additional Bonds" or "Prior Lien Additional Bonds", all as ; provided in Section 23 of this Ordinance. i Y (f) The term "System" shall mean (1) the City's entire existing waterworks and sewer system, together with all I; future extensions, improvements, enlargements, and additions thereto, and all replacements thereof, and (2) at the sole ~ option of the City, which may or may not be exercised in the i future, the City's entire waterworks and sewer system, which may be added to the initial System, and (3) any other related facilities, all or any part of the revenues or income from which may, in the future, at the option of the City, and in accordance with law, become "Pledged Revenues" ` as hereinafter defined; provided that, notwithstanding the ' foregoing, and to the extent now or hereafter authorized or ~ 5 ~ - ~ E 1 R permitted by law, the term System shall not mean any sewer, ~ ~ water, or other facilities of any kind which are declared ; not to be a part of the System, and which are acquired or q constructed by 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 ~ ~ payable from or secured by any Pledged Revenues, but which ~ ; are secured by and payable from liens on and pledges of any ~ ~ other revenues, sources, or payments, including, but not ; ~ limited to, special contract revenues or payments received ~ ; from any other legal entity in connection with such facili- ' ~ ties; and such revenues, sources, or payments shall not be ! considered as or constitute Gross Revenues of the System, G ` unless and to the extent otherwise provided in the ordinance ` or ordinances authorizing the issuance of such "Special Facilities Bonds". ' (g) The terms "Gross Revenues of the System" and ~ ~"Gross Revenues" shall mean all revenues and income of every ~ nature derived or received by the City from the operation ; and ownership of the System, including the interest income ' from the investment or deposit of money in any Fund created E by this Ordinance. ; w , (h) The terms "Net Revenues of the System", and "Net ~F Revenues" shall mean all Gross Revenues after deducting and ~ paying the current expenses of operation and maintenance of ` the System out of the System Fund, hereinafter created, in- cluding all salaries, labor, materials, repairs, and exten- sions necessary to render efficient service, provided, how- ever, that only such repairs and extensions, as in the judgment of the City Council, reasonably and fairly exer- cised by the adoption of appropriate resolutions, are necessary to keep the System in operation and render ade- quate service to to said City and the inhabitants thereof, ? or such as might be necessary to meet some physical accident ; or condition which would otherwise impair the Bonds or Additional Parity Revenue Bonds, shall be deducted in determining "Net Revenues". Depreciation and amortization shall not be considered as an expense of operation and : maintenance in determining Net Revenues. i' (i) The term "Pledged Revenues" shall mean t (1) the Net Revenues, plus ~ (2) any additional revenues, income, or other resources, including, without limitation, any grants, ~ donations, or income received or to be received from the United States Government, or any other public or ~ S; private source, whether pursuant to an agreement or ` otherwise, which in the future may, at the option of ' the City, be pledged to the payment of the Bonds or Additional Bonds. tl. (j) The term "year" or "fiscal year" shall mean the g fiscal year used by the City in connection with the opera- ~ tion of the System. F (k) The term "Government Obligations" shall mean ; ; direct obligations of the United States of America, includ- ~ ing obligations the principal of and interest on which are " ; unconditionally guaranteed by the United States of America, A` which may be United States Treasury obligations such as its State and Local Government Series, which may be in book- ~E entry form. Section 8. PLEDGE. That the Bonds and any Additional , j Bonds (as defined in Section 23 hereof), and the interest ; coupons appertaining thereto, are and shall be secured by s ; and payable from an irrevocable lien on and pledge of the ~ Pledged Revenues, subject and subordinate only to any first a ~ F E 6 r, i i y ! j: ~ I 3 i lien on and pledge of the Pledged Revenues hereafter created and made to secure and pay any Prior Lien Additional Bonds (as defined in Section 23 hereof) hereafter issued, and the ~ Pledged Revenues are further pledged irrevocably to the ~ establishment and maintenance of the Funds created by this ~ Ordinance, and any Funds created by any ordinance authoriz- ~ ing the issuance of any Additional Bonds. The Bonds and any ~ ~ Additional Parity Revenue Bonds (as defined in Section 23 : hereof) are and shall be secured by and payable from the ~ ~ Pledged Revenues, in the manner and to the extent provided ; in the ordinances authorizing their issuance, but they are ~ not and will not be secured by or payable from a mortgage or ~ ; deed of trust on any real, personal, or mixed properties ; constituting the System. ~ R ` Section 9. SYSTEM FUND. That there is hereby created ~ and there shall be established and maintained on the books ; i= of the City, aiid accounted for separate and apart from all ` ~ r, other funds of the City, a special fund to be entitled the ~ '"City of Paris Waterworks and Sewer System Fund" (the ~"System Fund"). All Gross Revenues shall be credited to the ; Systetr, Fund immediately upon receipt, unless otherwise ' x provided in this Ordinance. All current e*penses of opera- ; tion and maintenance of the System shall be paid from such s Gross Revenues credited to the System Fund as a first charge against same. Before making any deposits hereinafter ' required to be made from the System Fund, the City shall retain in the System Fund at all times an amount at least y` equal to one-sixth of the amount budgeted for the then w ?i current fiscal year for the current operation and mainten- ' ance expenses of the System. ? Section 10. INTEREST AND SINKING FUND. That for the ; s sole purpose of paying the principal of and interest on all s bonds which are payable from Pledged Revenues, there is hereby created and there shall be established and maintained ~ on the books of the City, and accounted for separate and ~ apart from all other funds of the City, a separate fund to be entitled the "City of Paris Waterworks and Sewer System ~ Revenue Refunding Bonds Interest and Sinking Fund" (the s~ "Interest and Sinking Fund" ) . ; Section 11. PRIOR LIEN ADDITIONAL BONDS RESERVE FUND. ~ That there is hereby created, and if, in the future, any ~ ~ry Prior Lien Additional Bonds are issued by the City, there ~ c9 shall be established and maintained, at the same bank where ~ the Reserve Fund created pursuant to Section 12 is kept, a ; separate fund to be entitled the "City of Paris Waterworks ' ` and Sewer System Prior Lien Additional Bonds Reserve Fund" (the "Prior Lien Reserve Fund"). The Prior Lien Reserve Fund shall be used to pay the principal of and interest on ~ any Prior Lien Additional Bonds when and to tfie extent the : amounts in the Interest and Sinking Fund are insufficient ' for such purpose, and may be used for the purpose of finally retiring the last of any Prior Lien Additional Bonds. Section 12. RESERVE FUND. That there is hereby ` created and there shall be established and maintained initially at the City's official depository bank, a separate fund to be entitled the "City of Paris Waterworks and Sewer System Bonds and Additional Bonds Reserve Fund" (the "Re- serve Fund"). The Reserve Fund shall be used to pay the s; principal of and interest on any Bonds or Additional Bonds ( when and to the extent the amounts in the Interest and i; Sinking Fund available for such payment are insufficient for ~i such purpose, and may be used for the purpose of finally ' retiring the last of any Bonds or Additional Bonds. ~4 ? ; Section 13. IMPROVEMENT AND CONTINGENCY FUND. That ~ ; there is hereby created and there shall be established and ~ ~ maintained on the books of the City, and accounted for ' ' separate and apart from all other funds of the City, a ~ { E 92 ~ 4 ~ ~7 i ~ / I ~ _ _ _ . . . . . . . . . ~ . . i, k f fl: ~ ~ separate fund to be entitled the "City of Paris Waterworks ~ F and Sewer System Improvement and Contingency Fund" (the ` '"Improvement and Contingency Fund"). The Improvement and ! i`Contingency Fund shall be used for the purpose of paying the ~ costs of improvements, enlargements, extensions, additions, ; ~ replacements, or other capital expenditures related to the ~ System, or for paying the costs of unexpected or extraordin- e ary repairs or replacements of the System for which System Funds are not available, or for paying unexpected or extra- p ; ordinary expenses of operation and maintenance of the System ~ ~ for which System funds are not otherwise available, or for ~ any other lawful purpose. ! ~ Section 14. DEPOSITS OF PLEDGED REVENUES; INVESTMENTS; ~ FUNDS SECURED. (a) That Pledged Revenues shall be credited ~ : to or deposited in the Interest and Sinking Fund, the Prior Lien Reserve Fund, the Reserve Fund, the Improvement and Contingency Fund, and other funds when and as required by ~ ? this Ordinance and any ordinance authorizing the issuance of ' a Additional Parity Revenue Bonds. ~ t: (b) That money in any Fund established pursuant to ~ this Ordinance or any ordinance authorizing the issuance of ; Additional Parity Revenue Bonds, may, at the option of the ~ City, be placed in time deposits or certificates of deposit ; secured by obligations of the type hereinafter described, or ~ be invested 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 obligations of instrumentalities of the United States of ~ America, including, but not limited to, evidences of indebt- ~ edness issued, insured, or guaranteed by such governmental ~ ; agencies as the Federal Land Banks, Federal Intermediate 4 r; Credit Banks, Banks for Cooperatives, Eederal Home Loan ; ; Banks, Government National Mortgage Association, United ` ~ States Postal Service, Farmers Home Administration, Federal ' ;i Home Loan Mortgage Association, Small Business Administra- ~ tion, Federal Housing Association, or Participation Certifi- cates in the Federal Assets Financing Trust; provided that ~ all such deposits and investments shall be made in such manner that the money required to be expended from any Eund ; ;i will be available at the proper time or times. Such invest- ~ ments shall be valued in terms of current market value as of 9 ' the last day of each fiscal year. All interest and income j derived from such deposits and investments immediately shall ; be credited to, and any losses debited to, the Fund f rom F which the deposit or investment was made, and surpluses in ~ any Fund shall or may be disposed of as hereinafter ~ provided. Such investments shall be sold promptly when necessary to prevent any default in connection with the Bonds, Additional Bonds, or Prior Lien Additional Bonds, consistent with the ordinances, respectively, authorizing their issuance. ,r (c) That money in all Funds created by this Ordinance, ~ to the extent not invested, shall be secured in the manner ~ ~i prescribed by law. ~ ~ s Section 15. PRIORITY OF DEPOSITS AND PAYMENTS FROM SYSTEM FUND. That the City shall make the deposits and pay- ments from Pledged Revenues in the System Fund when and as ~ required by this Ordinance and any ordinance authorizing ~ , ? Additional Parity Revenue Bonds or any other subordinate ~ lien bonds, and such deposits shall be made in the following ; ~ order and with the following irrevocable priorities, respec- ~ ~tively: ~ First, to the Prior Lien Additional Bonds Account ~ in the Interest and Sinking Fund, when and in ~ ? the amounts required by this Ordinance and 1 ~ 8 ~ F ~ ~ v any ordinance authorizing any Prior Lien Addi- ~ tional Bonds; ~ Second, to the Prior Lien Reserve Fund, when and in the amounts required by this Ordinance and ~ any ordinance authorizing any Prior Lien ~ g~ Additional Bonds; ~ s ~ Third, to the Bonds and Additional Bonds Account in ~ the Interest and Sinking Fund, when and in the amounts required by this Ordinance and any or- j ; dinance authorizing the issuance of Additional ? Bonds; ~ F Fourth, to the Reserve Fund, when and in the amounts ~ f'e required by this Ordinance and any ordinance ~ authorizing any Additional Bonds; ~ ~ Fifth, to the payment of principal, interest, and ~ reserve fund requirements for any bonds which C ~ hereafter may be issued by the City that are ~ payable from and secured by a lien on and pledge of the Pledged Revenues whiqh is subor- ~ dinate to the liens of the Bonds, Additional Bonds, and Prior Lien Additional Bonds, when s and in the amounts required by any ordinance au- 3 thorizing the issuance of such subordinate lien ; bonds; and ~ ; I Sixth, to the Improvement and Contingency Fund, when ~ and as required by Section 19 of this Ordinance. ~ ai Y~ Section 16. INTEREST AND SINKING FUND REQUIREMENTS. ~ (a) That there is hereby created, and if, in the ~ ~ future, any Prior Lien Additional Bonds are issued by the ~ City there shall be established and maintained, a separate ; account within the Interest and Sinking Fund to be known as ~ the "Prior Lien Additional Bonds Account", for the sole ~ benefit of such bonds. Deposits shall be made to the credit ~ of said Account monthly, on or before the lOth day of each month while any Prior Lien Additional Bonds are outstanding, ' in amounts sufficient, together with any other funds on hand ~ "i therein, to pay all of the interest or principal and inter- est coming due, or required to be redeemed prior to maturity ~ , pursuant to any mandatory redemption requirements, on the + next succeeding June 15 or December 15, respectively, all as ~ required by any ordinance authorizing any such Prior Lien ~ Additional Bonds. Such deposits shall be made in approxi- ~ mately equal monthly installment to the extent practicable. ~ f} (b) That there is hereby created and there shall be j established and maintained a separate account within the In- a terest and Sinking Eund to be known as the "Bonds and Addi- ~ tional Bonds Account", for the sole benefit of such bonds. ~ On or before July 10, 1983, and monthly, on or before the j lOth day of each month thereafter, while any Bonds or Ad- ~ ~ ditional Bonds are outstanding, deposits shall be made to ; the credit of said Account in amounts sufficient, together y with any other funds on hand therein, to pay the interest or principal and interest coming due, or required to be re- ' deemed prior to maturity pursuant to the mandatory redemp- ~ tion requirements for the Bonds and Additional Bonds, on the t next succeeding June 15 or December 15, respectively, all as ~ li required by this Ordinance and any ordinances authorizing ~ any Additional Bonds. It is specifically ordained that such ; deposits shall be sufficient to provide the funds necessary ~ to redeem prior to maturity the principal amounts of the ~ Bonds, respectively, when required to be redeemed pursuant ' ~i to the mandatory redemption requirement set forth on the ~ s faces of the Bonds and in the Form of Bonds in Section 6 of a ~ 9 s ; i 4! ~ ~ ~ ~ ~ ; ~ 3 this Ordinance. Such deposits shall be made in approximate- 9 ~i ly equal monthly installments to the extent practicable. ~ ~ ~ Section 17. PRIOR LIEN RESERVE FUND REQUIREMENTS. Y i';;That after the initial delivery of any Prior Lien Additional i i;Bonds the City shall cause to be deposited in the Prior Lien ,:Reserve Fund an amount equal to the average annual principal and interest requirements, of such initial Prior Lien Addi- i : tional Bonds. After the delivery of any other Prior Lien ~ Additional Bonds the City shall cause the Prior Lien Reserve t i'.Fund to be increased, if and to the extent necessary, so ' J that such Fund will contain an amount of money and ° investments equa] in market value to the average annual ° ;`principal and interest requirements of all Prior Lien ; : Additional Bonds which will be outstanding after such ; P delivery. An amount of money and investments equal in ' market value to the average annual principal and interest ~ requirements, of all Prior Lien Additional Bonds at any time ~ E`outstanding is hereby designated as the "Required Prior Lien ' Reserve Amount". All or any part of the Prior Lien Reserve ~ ; Fund may be funded from Pledged Revenues, or from proceeds N ' from the sale of any Prior Lien Additional Bonds, or any g other available source, or any combination of sources. All % ~ or any part of the Prior Lien Reserve Fund not funded ; ° initially and immediately after the delivery of any series ~ or issue of Prior Lien Additional Bonds shall be funded, ; within not more than five years from such date of such ~ delivery, by deposits of Pledged Revenues in approximately 'i equal semiannual installments, made on or before the lOth ~ E day of each June and each December. Principal amounts of ; i' any Prior Lien Additional Bonds which must be redeemed ; pursuant to any applicable mandatory redemption requirements shall be deemed to be maturing amounts of principal for the F purpose of calculating principal and interest requirements ? ' of the Prior Lien Additional Bonds. When and so long as the ; amount in the Prior Lien Reserve Fund is not less than the f ! Required Prior Lien Reserve Amount no deposits shall be made to the credit of the Prior Lien Reserve Fund; but when and ; i if the Prior Lien Reserve Fund at any time contains less i' than the Required Prior Lien Reserve Amount, then the City l shall transfer from Pledged Revenues in the System Fund, semiannually on or before the lOth day of each June and of = each December, a sum equal to 1/10th of the Required Prior ; ' Lien Reserve Amount, until the Prior Lien Reserve Fund is ; ; restored to the Required Prior Lien Reserve Amount. The ; City specifically covenants that when and so long as the ~ Prior Lien Reserve Fund contains the Required Prior Lien Reserve Amount, the City shall cause all interest and income a ; derived from the deposit or investment of the Prior Lien ' ~.i Reserve Fund to be deposited to the credit of the Prior Lien < Additional Bonds Account in the Interest and Sinking Fund. 9 ~ i Section 18. RESERVE FUND REQUIREMENTS. That on or ~ before the delivery of the Bonds the City shall cause to be ~ deposited in the Reserve Fund, from available funds of the ~ City the amount of $336, 500, which is at least equal to the ; ' average annual principal and interest requirements of the ~ ; Bonds. After the delivery of any Additional Bonds the City ~ shall cause the Reserve Fund to be increased, if and to the ~ ; extent necessary, so that such fund will contain an amount i of money and investments equal in market value to the ~ average principal and interest requirements, of all Bonds ; and Additional Bonds which will be outstanding after such delivery. An amount of money and investments equal in ~ market value to the average annual principal and interest requirements of all Bonds and Additional Bonds at any time j ~ outstanding is hereby designated as the "Required Reserve ~ Amount". Any increase in the Required Reserve Amount may be ~ ` funded from Pledged Revenues, or from proceeds from the sale ; of any Additional Bonds, or any other available source or combination of sources. All or any part of the Required Reserve Amount not funded initially and immediately after ~ , ~ 10 ~ ~ ~ ~ s ~ ~ p the delivery of any installment or issue of Additional Bonds ~ shall be funded, within not more than five years from the a=',date of such delivery, by deposits of Pledged Revenues in ~ 1a,approximately equal semiannual installments on or before the ; lOth day of each June and each December. Principal amounts ~ 1! of the Bonds and any Additional Bonds which must be redeemed ~ pursuant to any applicable mandatcry redemption requirements ~ ; shall be deemed to be maturing amounts of principal for the ; y purpose of calculating principal and interest requirements on such bonds. When and so long as the amount in the ~ # Reserve Fund is not less than the Required Reserve Amount no ~ deposits shall be made to the credit of the Reserve Fund; ; but when and if the Reserve Fund at any time contains less i' than the Required Reserve Amount, then the City shall ; transfer from Pledged Revenues in the System Fund, and ; deposit to the credit of the Reserve Fund, semiannually on ; or before the lOth day of each June and of each December, a : ; sum equal to 1/10th of the Required Reserve Amount, until ~ the Reserve Fund is restored to the Required Reserve Amount. ~ The City specifically covenants that when and so long as the ~ ; Reserve Fund contains the Required Reserve Amount, the City ' shall cause all interest and income derived from the deposit or investment of the Reserve Fund to be ~deposited to the ~ ~ credit of the Bonds and Additional Bonds Account in the ~ Interest and Sinking Fund. ~ E; Section 19. IMPROVEMENT AND CONTINGENCY FUND REQUIRE- ~ ~ MENTS. That after delivery of the Bonds and subject to the priorities and deposits provided for and required under ~ Section 15 of this Ordinance, the City will, at the end of i i: each fiscal year, cause all remaining surplus Pledged ~ ' Revenues from the System Fund to be transferred and ; deposited to the credit of the Improvement and Contingency ? Fund, to be used as provided or permitted in Section 13 of ? ~ ± this Ordinance. ; Jl ~ ; Section 20. DEFICIENCIES; EXCESS PLEDGED REVENUES. (a) That if on any occasion there shall not be sufficient ; F' Pledged Revenues to make the required deposits into the In- ~ terest and Sinking Fund, the Prior Lien Reserve Fund, or the ; ~ Reserve Fund, then such deficiency shall be made up as soon e as possible from the next available Pledged Revenues. ; ? (b) That, subject to making the required deposits to ~ m the credit of the various Funds when and as required by this Ordinance or any ordinance authorizing the issuance of Addi- ~ tional Parity Revenue Bonds, any surplus Pledged Revenues ~ may be used by the City for any lawful purpose. ~ ; Section 21. PAYMENT OF BONDS AND ADDITIONAL PARITY ~ z REVENUE BONDS. On or before June 10, 1984, and semiannually € = on or before each December 10 and June 10 thereafter while y ~ any of the Bonds or Additional Parity Revenue Bonds are x outstanding and unpaid the City shall make available to the ± Paying Agents therefor, out of the Interest and Sinking c Fund, or if necessary, out of the Reserve Fund, or the Prior Lien Reserve Fund, as applicable, money sufficient to pay, ' on each of such dates, the principal of and interest on the ' ~ Bonds and Additional Parity Revenue Bonds as the same matures and comes due, or to redeem the Bonds or Additional ~ Parity Revenue Bonds prior to maturity, either upon manda- Y; ~ tory redemption or at the option of the City. The Paying ; ; Agents shall destroy all paid Bonds and Additional Parity Revenue Bonds, and the coupons appertaining thereto, and ~ furnish the City with an appropriate certificate of can- cellation or destruction. ; Section 22. FINAL DEPOSITS. (a) That any Bond or fi Additional Parity Revenue Bond shall be deemed to be paid, ~ i` retired, and no longer outstanding within the meaning of ? this Ordinance when payment of the principal of, redemption ~ premium, if any, on such Bond or Additional Parity Revenue ~ s ~ ~ 11 ; ~ ; ~ ; ~ ~ i` ~ ~a ~;Bond, plus interest thereon to the due date thereof (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 ~ ~shave been provided by irrevocably depositing with or making ~ available to a Paying Agent therefor, in trust and irrevoc- $ ably set aside exclusively for such payment, (1) money sufficient to make such payment or (2) Government Obliga- ~ tions 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 make such ~ payment, and all necessary and proper fees, compensation, ~ ~3!and expenses of such Paying Agent pertaining to the Bonds ~ and Additional Parity Revenue Bonds with respect to which ~ such deposit is made shall have been paid or the payment ~ thereof provided for to the satisfaction of such paying ' agent. At such time as a Bond or Additional Parity Revenue ~ Bond shall be deemed to be paid hereunder, as aforesaid, it ' j shall no longer be secured by or entitled to the benefits of ~ this Ordinance or a lien on and pledge of the Pledged j ' Revenues, and shall be entitled to payment solely from such ~ money or Government Obligations. , s' (b) That any moneys so deposited with a paying agent j=may at the direction of the City also be invested in Govern- ment Obligations, maturing in the amounts and times as I hereinbefore set forth, and all income from all Government Obligations in the hands of the PaYing agent pursuant to this Section which is not required for the payment of the j Bonds and Additional Parity Revenue Bonds, the redemption ~ ~ipremium, if any, and interest thereon, with respect to which ~ such money has been so deposited, shall be turned over to ; the City or deposited as directed by the City. ' e ; Section 23. ADDITIONAL PARITY REVENUE BONDS. (a) ~ ?That the City shall have the right and power at any time and ~ from time to time, and in one or more Series or issues, to ~ authorize, issue, and deliver additional parity revenue ~ ~"bonds (herein called "Additional Parity Revenue Bonds"), in i ~ accordance with law, in any amounts, for any lawful purpose, s including the refunding of any Bonds, Additional Bonds, ~ ~ Prior Lien Additional Bonds, or other obligations. Such ~ Additional Parity Revenue Bonds, if and when authorized, a issued, and delivered in accordance with this Ordinance, may ~ ;Ibe either (1) bonds payable from and secured by an irrevoc- ~ able first lien on and pledge of the Pledged Revenues ~ ("Prior Lien Additional Bonds"), or (2) bonds payable from ~ ~ and secured by an irrevocable lien on and pledge of the ~ Pledged Revenues subject and subordinate only to any Prior ~ Lien Additional Bonds then outstanding or thereafter issued # ("Additional Bonds") with such Additional Bonds to be on a ~ ~ parity in all respects with the Bonds, all as hereinafter ~ i provided. ~ , j= (b) Prior Lien Additional Bonds, if and when authoriz- ~ ed, issued, and delivered in accordance with this Ordinance, ~ 1shall be payable from the Prior Lien Additional Bonds Account in the Interest and Sinking Fund, and shall be ~ !i payable from and secured by an irrevocable first lien on and ~ pledge of the Pledged Revenues, equally and ratably on a ~ parity with all other Prior Lien Additional Bonds. Also, ~ all Prior Lien Additional Bonds shall be additionally ; secured equally and ratably by the Prior Lien Reserve Fund, h as provided in Sections 11 and 17 hereof. ' y (c) Additional Bonds, if and when authorized, issued, ~ ~i and delivered in accordance with this Ordinance, shall be ~ ~ payable from the Bonds and Additional Bonds Account in the E Interest and Sinking Fund and shall be payable from and ~ secured by an irrevocable lien on and pledge of the Pledged ~ Revenues, subject and subordinate only to any Prior Lien ~ 12 ~ ~i ~ f< f ~ ' tAdditional Bonds then outstanding or thereafter issued, ?equally and ratably on a parity with the Bonds and all other ~outstanding Additional Bonds. Also the Additional Bonds ~ sha11 be additionally secured equally along with the Bonds ' by the Reserve Fund, as provided in Sections 12 and 18 j hereof. !3 (d) That the principal of and interest on all Addi- tional Parity Revenue Bonds must be scheduled to be paid or ~ mature on June 15 and/or December 15 of the years in which ~ such principal and interest are scheduled to be paid or mature. 1 ~ Section 24. FURTHER REQUIREMENTS FOR ADDITIONAL PARITY ¢ ' REVENUE BONDS. That Additional Parity Revenue Bonds shall ~ be issued only in accordance with this Ordinance, and no in- ~ stallment, Series, or issue of Additional Parity Revenue J; Bonds shall be issued or delivered unless: ; (a) The Mayor of the City and the City Clerk sign a ~ written certificate to the effect` that the City is not in ~ } default as to any covenant, condition, or obligation in ; ` connection with all then outstanding Bonds and Additional I Parity Revenue Bonds, and the ordinances authorizing same, ~ and that the Interest and Sinking Fund, the Prior Lien ~ Reserve Fund, and the Reserve Fund each contains the amount ~s then required to be therein. ~ (b) An independent certified public accountant, or in- dependent firm of certified public accountants, acting by ~ ~D and through a certified public accountant, signs a written ~ certificate to the effect that, in his or its opinion, 6 during either the next preceding fiscal year, or any twelve E consecutive calendar month period ending not more than ~ ninety days prior to the passage of the ordinance author- " ~ izing the issuance of the then proposed Additional Parity ; ~ Revenue Bonds, the Pledged Revenues were: j , ~ (1) if the then proposed bonds are to be Prior ; ~ Lien Additional Bonds, at least 1.25 times an amount ~ ~ equal to the average annual principal and interest ? ~ requirements, of Prior Lien Additional Bonds which are ~ payable from Pledged Revenues and which are scheduled ; ? to be outstanding after the delivery of the then ' proposed Prior Lien Additional Bonds, or ~ (2) if the then proposed bonds are to be Addi- ~ tional Bonds, at least equal to the aggregate of 1.10 ' times an amount equal to the average annual principal ~ and interest requirements of all then outstanding bonds s of any nature or lien which are payable from Pledged ~ Revenues and which are scheduled to be outstanding ~ ~ after the delivery of the then proposed Additional ~ ~ Bonds. ~ , It is specifically provided, however, that in calculat- i ing the amount of Pledged Revenues for the purposes of this ~ subsection (b), if there has been any increase in the rates ~ or charges for services of the System which is then in ; effect, but which was not in effect during all or any part E of the entire period for which the Pledged Revenues are € being calculated (hereinafter referred to as the "entire & 9 period") then the certified public accountant shall deter- ~ ? mine and certify the amount of Pledged Revenues as being the ¢ a, total of (i) the actual Pledged Revenues for the entire ~ ' period, plus (ii) a sum equal to the aggregate amount by which the actual billings to customers of the System during ~ y" the entire period would have been increased if such in- ~ creased rates or charges had been in effect during the entire period. ~ tl 13 ~ i i; i! 'rd i ' (c) If the then proposed bonds are to be Additional p'Bonds, an independent registered professional engineer of E;the State of Texas, or an independent firm of engineers ~ ~jacting by and through a registered professional engineer of ~ 'the State of Texas, signs a written certificate to the ~ ~°effect that, in his or its opinion, during each fiscal year s i!while any Bonds or Additional Bonds are scheduled to be ~ 1;,outstanding, beginning with the fiscal year next following R the date of the then proposed Additional Bonds, the Pledged ~ (Revenues estimated to be received during each of said fiscal ~ years, respectively, will be at least equal to 1.25 times ~ the principal and interest requirements, during each such ~ fiscal year, respectively, of all bonds of any nature or s a'lien which are payable from Pledged Revenues and which are ~ j~scheduled to be outstanding after the issuance of the then ~ proposed Additional Bonds. In arriving at such opinion dthere may be taken into consideration any prospective ; liadditions to the System or the Pledged Revenues, any ~ ~ scheduled, projected, or reasonably expected changes ~ rates and charges, anticipated increases or decreases in ~ 1?Pledged Revenues or maintenance and operation expenses of ; ~~the System, and any other factor which in his or its opinion ~ would have a material impact on the Pledged Revenues. ; (d) If the then proposed bonds are to be Prior Lien ~ Additional Bonds, provision shall be made in the ordinance ~ ~ authorizing their issuance for funding or increasing the Prior Lien Reserve Fund to the Required Prior Lien Reserve ~ Amount as required by Section 17 hereof. (e) If the then proposed bonds are to be Additional Bonds, provision shall be made in the ordinance authorizing ~ their issuance for increasing the Reserve Fund to the Required Reserve Amount as required by Section 18 hereof. o , f (f) That all calculations of principal and interest ~ t requirements of any bonds made in connection with the ~ issuance of any then proposed Additional Parity Revenue ~ " Bonds shall be made as of the date of such Additional Parity Revenue Bonds; and also in making calculations for such ; purpose, and for any other purpose under this Ordinance, ~ principal amounts of any bonds which must be redeemed prior ~ to maturity pursuant to any applicable mandatory redemption ~ E; requirements shall be deemed to be maturing amounts of ~ 1= principal of such bonds. ~ ¢ Section 25. GENERAL COVENANTS. The City further cove- ~ nants and agrees that in accordance with and to the extent ° required or permitted by law: ~ (a) Performance. It will faithfully perform at all ' times any and all covenants, undertakings, stipizlations, and ;s. provisions contained in this Ordinance, and each ordinance authorizing the issuance of Additional Parity Revenue Bonds, and in each and every Bond and Additional Parity Revenue i' Bond; that it will promptly pay or cause to be paid the ~ principal of and interest on every Bond and Additional ` Parity Revenue Bond, on the dates and in the places and f manner prescribed in such ordinances and Bonds or Additional ~ Parity Revenue Bonds; and that it will, at the times and in ~ ~I the manner prescribed, deposit or cause to be deposited the ~ I amounts required to be deposited into the Interest and E Sinking Fund, the Prior Lien Reserve Fund, and the Reserve ? i' Fund; and any holder of the Bonds or Additional Parity ~ ; Revenue Bonds may require the City, its officials, and ~ ~ employees, to carry out, respect, or enforce the covenants + ; and obligations of this Ordinance, or any ordinance author- ~ ; izing the issuance of Additional Parity Revenue Bonds, by { all legal and equitable means, including specifically, but without limitation, the use and filing of mandamus proceed- ~ ~ ings, in any court of competent jurisdiction, against the ; City, its officials, and employees. " ; ; ~ 14 ~ ~ f' € ~ ;i (b) City's Legal Authority. The City is a duly created and existing home rule city of the State of Texas, ; ~ and is duly authorized under the laws of the State of Texas a to create and issue the Bonds and Additional Parity Revenue ~ Bonds; that all action on its part for the creation and ~ issuance of the said obligations has been or will be duly s s i' and effectively taken, and that said obligations in the ~ hands of the holders and owners thereof are and will be a ; valid and enforceable special obligations of the City in ~ j' accordance with their terms. ~ ~ (c) Title. The City has or will obtain lawful title ~ ' to the lands, buildings, structures, and facilities consti- a ~j tuting the System, that it warrants that it will defend t'^e ~ title to all the aforesaid lands, buildings, structures, and ~ facilities, and every part thereof, for the benefit of the ~ holders and owners of the Bonds and Additional Parity ; Revenue Bonds, against the claims and demands of all persons + j' whomsoever, that it is lawfully qualified to pledge the ' Pledged Revenues to the payment of the Bonds and Additional ; ~ Parity Revenue Bonds in the manndr prescribed herein, and has lawfully exercised such rights. ! ~ (d) Liens. It will from time to time and before the $ same become delinquent pay and discharge all taxes, assess- ~ ments, and governmental charges, if any, which shall be law- ~ fully imposed upon it, or the System, that it will pay all ; lawful claims for rents, royalties, labor, materials, and ? supplies which if unpaid might by law become a lien or " ; charge thereon, the lien of which would be prior to or ~ interfere with the liens hereof, so that the priority of the " liens granted hereunder shall be fully preserved in the 1 manner provided herein, and that it will not create or ~ suffer to be created any mechanic's, laborer's, material- man's, or other lien or charge which might or could be prior ; ` to the liens hereof, or do or suffer any matter or thing y whereby the liens hereof might or could be impaired; pro- ? vided, however, that no such tax, assessment, or charge, and that no such claims which might be used as the basis of a ' mechanic's, laborer's, materialman's, or other lien or charge, shall be required to be paid so long as the validity ` of the same shall be contested in good faith by the City. ~ (e) Operation of System; No Free Service. While the ~ Bonds or any Additional Parity Bonds are outstanding and un- ~ paid the City shall continuously and efficiently operate the System, and shall maintain the System in good condition, re- " pair, and working order, all at reasonable cost. No free ; service of the System sha11 be allowed, and should the City € # or any of its agencies, instrumentalities, lessors, or con- 6 cessionaires make use of the services and facilities of the System, payment monthly of the standard retail price of the ~ i! services provided shall be made by the City or any of its x; agencies, instrumentalities, lessors, or concessionaires out of funds from sources other than the revenues of the System. ~ (f) Further Encumbrance. While the Bonds or any Addi- ~ j; tional Bonds are outstanding and unpaid, the City shall not ' ~t additionally encumber the Pledged Revenues in any manner, r except as permitted in this Ordinance in connection with ~ ~ Additional Parity Revenue Bonds, and as permitted in Section ~ 28 hereof, unless said encumbrance is made junior and ~ subordinate in all respects to the liens, pledges, coven- ~ ants, and agreements of this Ordinance and any ordinance ~ authorizing the issuance of Additional parity Revenue Bonds; $ but the right of the City to issue revenue bonds payable ; from a subordinate lien on the Pledged Revenues is specific- ~a ally recognized and retained. ~ d 9 Sale or Disposal of Property. While the Bonds or ; any Additional Parity Revenue Bonds are outstanding and un- ~ paid, the City shall not sell, convey, mortgage, encumber, ~ ~r 15 ~ r ~ ~a _ _ . ~ Y, d s @ 3 lease, or in any manner transfer title to, or dedicate to ~ ~ other use, or otherwise dispose of the System, or any ~ significant or substantial part thereof; provided that ; = whenever the City deems it necessary to dispose of any ~ 5 property, machinery, fixtures, or equipment, or dedicate ; such property to other use, it may sell or otherwise dispose ; ; of such property, machinery, fixtures or equipment, or ' s;dedicate such property to other use, when it has made € arrangements to replace the same or provide substitutes ~.therefor, unless it is determined by resolution of the City ~ Council that no such replacement or substitute is necessary. ; s (h) Insuranr.e. (1) The City shall cause to be insur- ~ ;ed for such parts of the System as would usually be insured by corporations operating like properties, with a respons- ; ible insurance company or companies, against risks, acci- 1 dents, or casualties against which and to the extent insur- ; ance is usually carried by corporations operating like properties, including, to the extent reasonably obtainable, ~ fire and extended coverage insurance, insurance against ~ damage by floods, and use and occupancy insurance. Public ' liability and property damage insurance shall also be carried unless the City Attorney gives a written opinion to ° the effect that the City is not liable for claims which ~ would be protected by such insurance. Al1 insurance prem- ; iums shall be paid as an expense of operation of the System. At any time while any contractor engaged in construction work shall be fully responsible therefor, the City shall not be required to carry insurance on the work being constructed ~ j! if the contractor is required to carry appropriate insur- ance. All such policies shall be open to the inspection of ~ the Bondholders and their representatives at all reasonable ~ times. Upon the happening of any loss or damage covered by ~ ' insurance from one or more of said causes, the City shall : make due proof of loss and shall do all things necessary or ; desirable to cause the insuring companies to make payment in ' full directly to the City. The proceeds of insurance cover- ~ ing such property, together with any other funds necessary . ; and available for such purpose, shall be used forthwith by ~ the City for repairing the property damaged or replacing the ~ ai, property destroyed; provided, however, that if said insur- ance proceeds and other funds are insufficient for such ~ purpose, then said insurance proceeds pertaining to the ~ System shall be deposited in a special and separate trust F fund, at an official depository of the City, to be desig- ; nated the Insurance Account. The Insurance Account shall be ; held until such time as other funds become available which, together with the Insurance Account, will be sufficient to ~ make the repairs or replacements originally required. (2) The annual audit hereinafter required may contain ~ a section commenting on whether or not the City has complied ~ ~s with the requirements of this Section with respect to the ? ~ maintenance of insurance, and shall state whether or not all ~ ~ insurance premiums upon the insurance policies to which ~ : reference is made have been paid. ` ~ (i) Rate Covenant. The City shall fix, establish, ~ maintain, and collect, such rates, charges, and fees for the " use and availability of the System at all times as are " necessary to produce Gross Revenues sufficient, together ~ with any other Pledged Revenues, (1) to pay all current ~ operation and maintenance expenses of the System, and (2) ~ produce an amount of Pledged Revenues during each fiscal ~ year at least (i) equal to 1.25 times the principal and ~ ~~~interest requirements during such fiscal year of all then ' ii outstanding Prior Lien Bonds, if any, and (ii) equal to 1.10 ~ " times the principal and interest requirements during each ~ fiscal year of all then outstanding bonds of any nature or ~ lien which are payable from Pledged Revenues. ~ n ~ ~ 16 ~ I ~ (j) Records. The City shall keep proper books of ~.record and account in which full, true, proper, and correct ~ ~entries will be made of all dealings, activities, and ~ ~transactions relating to the System, the Pledged Revenues, I ;and the Funds created pursuant to this Ordinance, and all ~ I9books, documents, and vouchers relating thereto shall at all ; ~ireasonable times be made available for inspection upon ~ request of any Bondholder or citizen of the City. To the ; extent consistent with the provisions of this Ordinance, the ~ !'City shall keep its books and records in a manner conforming ; to standard accounting practices as usually would be fol- lowed by private corporations owning and operating a similar ~ System, with appropriate recognition being given to essen- ~ tial differences between municipal and corporate accounting ~ ,~practices. 9 (k) Audits. After the close of each fiscal year while ~ ~i any of the Bonds or any Additional Parity Revenue Bonds are outstanding, an audit will be made of the books and accounts ~ relating to the System and the Pledged Revenues by an ~ independent certified public accduntant or an independent ~ firm of certified public accountants. As soon as practic- able after the close of each such year, and when said audit has been completed and made available to the City, a copy of ~ ~ such audit for the preceding year shall be mailed to the Municipal Advisory Council of Texas, to each paying agent ~ ~ for any bonds payable from Pledged Revenues, and to any Bondholders who shall so request in writing. The annual ~ audit reports shall be open to the inspection of the Bond- ~ holders and their agents and representatives at all reason- ~ able times. s ; (1) Governmental Agencies. It will comply with all of the terms and conditions of any and all franchises, permits, f3 , PI and authorizations applicable to or necessary with respect ~ to the System, and which have been obtained from any govern- i% mental agency; and the City has or will obtain and keep in p full force and effect all franchises, permits, authoriza- ~ : tion, and other requirements applicable to or necessary with respect to the acquisition, construction, equipment, opera- ; tion, and maintenance of the System. ' N' (m) No Competition. It will not operate, or grant any franchise or permit for the acquisition, construction, or operation of, any facilities which would be in competition with the System, and to the extent that it legally may, the City will prohibit any such competing facilities. ; (n) No Arbitrage. That the City covenants to and with ~ the purchasers of the Bonds and any Additional Parity Revenue Bonds that no use will be made of the proceeds of r; any of such bonds at any time throughout the term of any of , such bonds which, if such use had been reasonably expected on the date of delivery of any of such bonds to and payment therefor by the purchasers, would have caused any of such ~ bonds to be arbitrage bonds within the meaning of Section ~ 103(c) of the Internal Revenue Code of 1954, as amended, or y; any regulations or rulings pertaining thereto; and by this j covenant the City is obligated to comply with the require- g ments of the aforesaid Section 103(c) and all applicable and ~ pertinent Department of the Treasury regulations relating to ~ arbitrage bonds. The City further covenants that the ~ proceeds of all such bonds will not otherwise be used ? directly or indirectly so as to cause all or any part of x such bonds to be or become arbitrage bonds within the ' E' meaning of the aforesaid Section 103(c), or any regulations ~ f j' pertaining thereto. ~ ; ~ Section 26. AMENDMENT OF ORDINANCE. (a) The holders of Bonds and Additional Parity Revenue Bonds aggregating in ~ principal amount 51% of the aggregate principal amount of then outstanding Bonds and Additional Parity Revenue Bonds f ~ 4. ~ i. ~ 1/ pq _ ~ I il I : g} 1 1!shall have the right from time to time to approve any amend- ( H ment to this Ordinance which may be deemed necessary or de- ~ sirable by the City, provided, however, that nothing herein ~ ~ contained shall permit or be construed to permit the amend- ~;ment of the terms and conditions in this Ordinance or in the ~ Bonds or Additional Parity Revenue Bonds so as to: ~ (1) Make any change in the maturity of the out- ~ standing Bonds or Additional Parity Revenue Bonds; ~ (2) Reduce the rate of interest borne by any of the outstanding Bonds or Additional Parity Revenue ~ ~ Bonds; y: (3) Reduce the amount of the principal payable on the outstanding Bonds or Additional Parity Revenue Bonds; (4) Modify the terms of payment of principal of or interest on the outstanding Bonds or Additional Parity Revenue Bonds, or impose any conditions with respect to such payment; (5) Affect the rights of the holders of less , ~s than all of the Bonds and Additional Parity Revenue ` Bonds then outstanding; ii (6) Change the minimum percentage of the prin- ~ cipal amount of Bonds and Additional Parity Revenue Bonds necessary for consent to such amendment. ~ i` (b) If at any time the City shall desire to amend the ~ ~a Ordinance under this Section, the City shall cause notice of " the proposed amendment to be published in a financial news- ~ ;i paper or journal published in the City of New York, New ; York, once during each calendar week for at least two ~ successive calendar weeks. Such notice shall briefly set j ' forth the nature of the proposed amendment and shall state ~ that a copy thereof is on file at the principal office of ; the Paying Agents for inspection by all holders of Bonds and ~ t~ Additional Parity Revenue Bonds. Such publication is not ~ required, however, if notice in writing is given to each holder of Bonds and Additional Parity Revenue Bonds. ~ (c) Whenever at any time not less than thirty days, 'i and within one year, from the date of the first publication ! of said notice or other service of written notice the City shall receive an instrument or instruments executed by the holders of at least 51% in aggregate principal amount of all Bonds and Additional Parity Revenue Bonds then outstanding, i which instrument or instruments shall refer to the proposed ; ~n amendment described in said notice and which specifically ~ consent to and approve such amendment in substantially the ~ g!; form of the copy thereof on file with the Paying Agents, the City Council may pass the amendatory ordinance in substan- ~ tially the same €orm. ~ 9 (d) Upon the passage of any amendatory ordinance pur- ~ suant to the provisions of this Section, this Ordinance & shall be deemed to be amended in accordance with such ~ amendatory ordinance, and the respective rights, duties, and ~ . obligations under this Ordinance of the City, and all the ~ holders of then outstanding Bonds and Additional Parity ~ Revenue Bonds and all future Bonds and Additional Parity ~ ~ t= Revenue Bonds shall thereafter be determined, exercised, and ~ enforced hereunder, subject in all respects to such amend- ~ ws V ments. ~ (e) Any consent given by the holder of a Bond or Addi- ~ ~r I r4 tional Parity Revenue Bond pursuant to the provisions of q3 this Section shall be irrevocable for a period of six months ; from the date of the first publication of the notice ~ ~ ~ ~ ;i ',1 18 ~s J'provided for in this Section, and shall be conclusive and '=:'binding upon all future holders of the same Bond or Addi- itional Parity Revenue Bond during such period. Such consent ~ ~jmay be revoked at any time after six months from the date of i,"the first publication of such notice by the holder who gave ~ psuch consent, or by a successor in title, by filing notice thereof with the paying agents and the City, but such ; revocation shall not be effective if the holders of 51°,o in 6'aggregate principal amount of the then outstanding Bonds and j:Additional Parity Revenue Bonds as in this Section defined ~have, prior to the attempted revocation, consented to, and ~ ~F approved the amendment. ~ 's (f) For the purpose of this Section, the fact of the iholding of Bonds or Additional Parity Revenue Bonds by any bondholder and the amount and numbers of such Bonds or Addi- ~ ~~tional Parity Revenue Bonds and the date of their holding , lpsame, may be proved by the affidavit of the person claiming ~ {'to be such holder, or by a certificate executed by any trust ~ ;;company, bank, banker, or any other depository wherever J,situated showing that at the date therein mentioned such ;;person had on deposit with such trust company, bank, banker, ~ j°'or other depository, the Bonds and Additior~al Parity Revenue i`Bonds described in such certificate. The City may conclu- % i !;sively assume that such ownership continues until written ~ s notice to the contrary is served upon the City. Section 29. APPROVAL AND REGISTRATION OF BONDS. That ~ ~;the Mayor of the City is hereby authorized to have control ~ jof the Bonds and all necessary records and proceedings per- ' ;~taining to the Bonds pending their delivery and their =1 investigation, examination, and approval by the Attorney ~General of the State of Texas, and their registration by the ~ Comptroller of Public Accounts of the State of Texas. Upon 'registration of the Bonds, said Comptroller of Public ~ i Accounts (or a deputy designated in writing to act for said ~ ~=.Comptroller) shall manually sign the Comptroller's Registra- ~ tion Certificate printed and endorsed on the Bonds, and the ~ seal of said Comptroller shall be impressed, or placed in ~ facsimile, on each of the Bonds. ' f Section 30. SALE OF BONDS. That the Bonds are hereby ~ ?±sold and shall be delivered in accordance with an Bond ' Purchase Contract in form and substance approved by a ~ F~resolution adopted by the City Council at the meeting at which this Bond Ordinance has been passed. ; i; Section 31. APPROVAL OF OFFICIAL STATEMENT. That an ~ Official Statement dated May 20, 1983, relating to the a. Bonds, in substantially the form as submitted to this meet- ' `+ing, is hereby approved and authorized to be distributed to ~ prospective investors, including all ultimate purchasers, ~ and other interested parties in connection with the sale and ~ resale of the Bonds, with such changes therein as shall be ~ approved by the Mayor of the City. It is further officially ; found, determined, and declared that the statements and ~ !i? representations contained in said Official Statement are i true and correct in all material respects to the best ; y` knowledge and belief of the City Council. ! ~i a Section 32. PROCEEDS OF SALE. That promptly after the delivery of the Bonds all of the proceeds from the sale and delivery of the Bonds shall be deposited with InterFirst R' Bank N.A., Dallas, Texas, which is a place of payment ~ (paying agent) for the Outstanding Bonds, and such proceeds ~ shall be used for the purpose of refunding, discharging, and ~ retiring all of the Outstanding Bonds, for the deposit of 'a accrued interest to the credit of the Bonds and Additional ~ Bonds Account, in the Interest and Sinking Fund, and for , s~ paying all costs and expenses of issuing the Bonds. By a q resolution of the City Council of even date herewith the j City Council has authorized the execution of a"Escrow ~ ~ 19 i c! ! ~ i 6. E; Agreement City of Paris Waterworks and Sewer System Revenue ~ Refunding Bonds, Series 1983" between the City and ~ InterFirst Bank, National Association, Dallas, Texas, which ~ provides for the deposit with said bank of the part of said , e; proceeds required for the purpose of refunding, discharging, ~ k and retiring the Outstanding Bonds. ~ x' Section 33. REASONS FOR REFUNDING. That it is speci- ~i fically found and determined by the City that the underlying ~ ordinances authorizing the Outstanding Bonds contain restrictive covenants which require the City to provide ~ Y excess revenues which results in the necessity of charging R; and collecting rates considerably higher than necessary, ~ thus increasing the cost of water and sewer services to the g inhabitants of the City and prevent, because of excessively ~ restrictive covenants, the adequate and economical financing P of projects.which are expected to be required for the System ~ in the near future, and require unnecessary, cumbersome, and , onerous procedures with respect to operation and maintenance ~ ; of the System and the issuance of bonds thereunder. There- ~ fore, for the reasons stated in this Section, the City and ? ~ the City Council have found it to be necessary and essential ~ in the best interest of the City that such refunding be ; accomplished, and the Outstanding Bonds be refunded, dis- ~ charged, and retired thereby. ' i Section 34. FURTHER PROCEDURES. That the Mayor, City ~ ~s Clerk, and all other officers, employees, and agents of the j; City, and each of them, shall be and they are hereby ' ~a expressly authorized, empowered, and directed from time to ? time and at any time to do and perform all such acts and § things and to exexecute, acknowledge and deliver in the name g and under the corporate seal and on behalf of the City all ~ i; such instruments, whether or not herein mentioned, as may be ~ g; necessary or desirable in order to carry out the terms and ; provisions of this Ordinance and the Bonds, and the Bond h Purchase Contract and Official Statement pertaining thereto. h ~ In case any officer whose facsimile signature shall appear ~ ~ on any Bond or interest coupon appertaining thereto shall ~ cease to be such officer before the delivery of the Bonds, r ' such facsimile signature shall nevertheless be valid and ~ ' sufficient for all purposes the same as if he or she had i t` remained in office until such delivery. ~ Section 35. EMERGENCY MEASURE; EFFECTIVE DATE. That ~ this Ordinance is hereby passed as an emergency measure, to ➢ be effective immediately upon enactment, such emergency ~ being that the issuance and delivery of the Bonds herein g siauthorized are required as soon as possible for the preser- ; vation of the public peace, property, health, or safety. ~ Section 36. SEVERABILITY. That the provisions of this p Ordinance are severable; and in case any one or more of the ~ provisions of this Ordinance or the application thereof to any person or circumstance should be held to be invalid, un- ? :i constitutional, or ineffective as to any person or circum- a i~ stance, the remainder of this Ordinance nevertheless shall ~ ~ be valid, and the application of any such invalid provision ~ ~ to persons or circumstances other than those as to which it ' 5i is held invalid shall not be affected thereby. ~ Passed and adopted this 31s day of May, 19 3. ~ ~ - City of P ris z; ATTEST - City Cle k, City of Paris ~ s ; k s APPROVED AS T FORM: ~ s; k 4 / ~ ~ i City ttorney, City of Paris € „ i~