2013-024 AUTHORIZING THE ISSUANCE AND SALE OF GENERAL OBLIGATION BONDS SERIES 2013ORDINANCE NO. 2013 -024
ORDINANCE OF THE CITY OF PARIS, TEXAS
AUTHORIZING THE ISSUANCE OF
CITY OF PARIS, TEXAS
GENERAL OBLIGATION BONDS
SERIES 2013
CERTIFICATE FOR ORDINANCE
THE STATE OF TEXAS §
COUNTY OF LAMAR §
CITY OF PARIS §
We, the undersigned officers of the City of Paris (the "City "), hereby certify as follows:
1. The City Council of the City (the "City Council ") convened in SPECIAL MEETING ON
THIS 15TH DAY OF JULY, 2013, at the designated meeting place, and the roll was called of the
duly constituted officers and members of the City Council, to wit:
Arjumand Hashmi, Mayor
Aaron Jenkins, Councilmember District 1
Billie Sue Lancaster, Councilmember District 2
John Wright, Councilmember District 3
Richard Grossnickel, Councilmember District 4 and Mayor Pro -tem
Matt Freirson, Councilmember District 5
Cleonne Holmes Drake, Councilmember District 6
Janice Ellis, City Clerk
l j.. ,
and all of said persons were present, except the following absentees�ZEAk,y G��Ssy � thus
constituting a quorum. Whereupon, among other business, the following was transacted at said
Meeting: a written
ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF CITY OF
PARIS, TEXAS GENERAL OBLIGATION BONDS, SERIES 2013; LEVYING
AN ANNUAL AD VALOREM TAX FOR THE PAYMENT OF SAID BONDS;
APPROVING AN OFFICIAL STATEMENT; AND ENACTING OTHER
PROVISIONS RELATING TO THE SUBJECT
was duly introduced for the consideration of the City Council. It was then duly moved and seconded
that the Ordinance be adopted and, after due discussion, said motion, carrying with it the adoption
of the Ordinance, prevailed and carried by the following vote:
AYES: All members of the City Council shown present above voted "Aye," except as
shown below:
NOES: N 0'^ I:
ABSTAIN: 6 `� `�
2. That a true, full and correct copy of the aforesaid Ordinance adopted at the Meeting
described in the above and foregoing paragraph is attached to and follows this Certificate; that the
Ordinance has been duly recorded in the City Council's minutes of the Meeting; that the above and
foregoing paragraph is a true, full and correct excerpt from the City Council's minutes of the Meeting
pertaining to the adoption of the Ordinance; that the persons named in the above and foregoing
paragraph are the duly chosen, qualified and acting officers and members of the City Council as
indicated therein; that each of the officers and members of the City Council was duly and sufficiently
notified officially and personally, in advance, of the time, place and purpose of the aforesaid Meeting,
and that the Ordinance would be introduced and considered for adoption at the Meeting, and each
of the officers and members consented, in advance, to the holding of the Meeting for such purpose,
and that the Meeting was open to the public and public notice of the time, place and purpose of the
meeting was given, all as required by Chapter 551, Texas Government Code.
3. That the Mayor of the City (or the Mayor Pro -tem in the absence of the Mayor) has
approved and hereby approves the aforesaid Ordinance; and that the Mayor (or the Mayor Pro -tem
in the absence of the Mayor) and the City Clerk of the City hereby declare that their signing of this
Certificate shall constitute the signing of the attached and following copy of the Ordinance for all
purposes.
Jah" e Ellis, City Clerk
(SEAL)
SIGNED AND SEALED the 15th day of July, 2013.
TABLE OF CONTENTS
Section 1. Recitals, Amount and Purpose of the Bonds . ............................... 1
Section 2. Designation, Date, Denominations, Numbers, and Maturities and Interest Rates of
Bonds................................ ............................... 1
Section 3. Characteristics of the Bonds ............. ............................... 2
Section 4. Form of Bonds ....................... ............................... 6
Section 5. Interest and Sinking Fund .............. ............................... 13
Section 6. Defeasance of Bonds ................. ............................... 14
Section 7. Damaged, Mutilated, Lost, Stolen, or Destroyed Bonds ...................... 15
Section 8. Custody, Approval, and Registration of Bonds; Bond Counsel's Opinion; Cusip
Numbers and Contingent Insurance Provision, If Obtained; Engagement of Bond
Counsel.............................. ............................... 16
Section 9. Covenants Regarding Tax Exemption of Interest on the Bonds ................. 17
Section 10. Sale of Bonds and Approval of Official Statement; Further Procedures.......... 19
Section 11. Default and Remedies ................ ............................... 19
Section 12. Compliance with Rule 15c2- 12 ......... ............................... 21
Section 13. Method of Amendment ............... ............................... 23
Section 14. Effective Date ..................... ............................... 25
Section 15. Allocation Of, and Limitation On, Expenditures for the Project ............... 25
Section 16. Interest Earnings on Bond Proceeds ..... ............................... 25
Section 17. Construction Fund .................. ............................... 25
Section 18. Net Premium ...................... ............................... 26
Section 19. Appropriation ...................... ............................... 26
Section 20. Severability ...................................................... 26
Schedule Voted Bonds ....................... ............................... 27
Exhibit A Annual Financial Statements and Operating Data ........................... A -1
ORDINANCE No. 2013 -024
AUTHORIZING THE ISSUANCE AND SALE OF CITY OF PARIS, TEXAS GENERAL
OBLIGATION BONDS, SERIES 2013; LEVYING AN ANNUAL AD VALOREM TAX FOR
THE PAYMENT OF SAID BONDS; APPROVING AN OFFICIAL STATEMENT; AND
ENACTING OTHER PROVISIONS RELATING TO THE SUBJECT
THE STATE OF TEXAS §
LAMAR COUNTY §
CITY OF PARIS §
WHEREAS, at an election in the City of Paris, Texas (the "Issuer ") held on May 11, 2013 (the
"Election "), the voters of the Issuer approved the issuance of tax bonds by the Issuer in the aggregate
principal amount of $45,000,000 for the purpose of constructing and acquiring improvements and
equipping the Issuer's waterworks and sewer system, to -wit: for replacing and extending water
distribution lines and sewer collection lines and constructing repairs to streets and drainage
infrastructure necessitated by such water and sewer line construction;
WHEREAS, the City Council of the Issuer deems it necessary and advisable to authorize, issue
and deliver $35,000,000 (including principal and premium) of said voted bond authorization from the
Election for the purposes stated in the preceding paragraph, thereby leaving $10,000,000 of voted but
unissued bond authorization from the Election;
WHEREAS, the Bonds hereinafter authorized are to be issued, sold and delivered pursuant to
the general laws of the State of Texas, including Tex. Gov't Code Ann. Chapter 1331, as amended;
and
WHEREAS, It is officially found, determined, and declared that the meeting at which this
Ordinance has been adopted was open to the public and public notice of the time, place and subject
matter of the public business to be considered and acted upon at said meeting, including this
Ordinance, was given, all as required by the applicable provisions of Tex. Gov't Code Ann. ch. 551;
Now, Therefore
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS:
Section 1. RECITALS, AMOUNT AND PURPOSE OF THE BONDS. The recitals set forth
in the preamble hereof are incorporated herein and shall have the same force and effect as if set forth
in this Section. The bonds of the Issuer are hereby authorized to be issued and delivered in the
aggregate principal amount of $33,925,000 for replacing and extending water distribution lines and
sewer collection lines and constructing repairs to streets and drainage infrastructure necessitated by
such water and sewer line construction (the "Project "), and to pay the costs incurred in connection
with the issuance of the Bonds.
Section 2. DESIGNATION, DATE, DENOMINATIONS, NUMBERS, AND MATURITIES
AND INTEREST RATES OF BONDS. Each bond issued pursuant to this Ordinance shall be
designated: "CITY OF PARIS, TEXAS, GENERAL OBLIGATION BONDS, SERIES 2013," and
initially there shall be issued, sold, and delivered hereunder one fully registered bond, without interest
coupons, dated July 1, 2013, in the principal amount stated above and in the denominations hereinafter
stated, numbered T -1, with bonds issued in replacement thereof being in the denominations and
principal amounts hereinafter stated and numbered consecutively from R -1 upward, payable to the
respective Registered Owners thereof (with the initial bond being made payable to the initial purchaser
as described in Section 10 hereof), or to the registered assignee or assignees of said bonds or any
portion or portions thereof (in each case, the "Registered Owner "), and said bonds shall mature and
be payable serially on December 15 in each of the years and in the principal amounts, respectively, and
shall bear interest from the dates set forth in the FORM OF BOND set forth in Section 4 of this
Ordinance to their respective dates of maturity or redemption prior to maturity at the rates per annum,
as set forth in the following schedule:
Years of
Principal
Interest
Years of
Principal
Interest
Maturity
Amount
Rates
Maturity
Amount
Rates
2013
$875,000
1.000%
2023
$1,910,000
5.000%
2014
875,000
1.000%
2024
2,010,000
5.000%
2015
560,000
2.000%
2025
2,100,000
4.000%
2016
775,000
4.000%
2026
2,185,000
4.000%
2017
775,000
4.000%
2027
2,275,000
4.000%
2018
750,000
4.000%
2028
2,380,000
5.000%
2019
750,000
4.500%
2029
2,490,000
4.250%
2020
1,500,000
4.500%
2030
2,600,000
4.375%
2021
1,730,000
5.000%
2031
2,720,000
4.375%
2022
1,815,000
5.000%
2032
2,850,000
5.000%
Section 3. CHARACTERISTICS OF THE BONDS.
(a) Registration, Transfer, Conversion and Exchange. The Issuer shall keep or cause to be
kept at the designated corporate trust office of The Bank of New York Mellon Trust Company, N.A.,
in Dallas, Texas (the "Paying Agent /Registrar "), books or records for the registration of the transfer,
conversion and exchange of the Bonds (the "Registration Books "), and the Issuer hereby appoints the
Paying Agent /Registrar as its registrar and transfer agent to keep such books or records and make such
registrations of transfers, conversions and exchanges under such reasonable regulations as the Issuer
and Paying Agent /Registrar may prescribe; and the Paying Agent /Registrar shall make such
registrations, transfers, conversions and exchanges as herein provided. The Paying Agent /Registrar
shall obtain and record in the Registration Books the address of the registered owner of each Bond
to which payments with respect to the Bonds shall be mailed, as herein provided; but it shall be the
duty of each registered owner to notify the Paying Agent /Registrar in writing of the address to which
payments shall be mailed, and such interest payments shall not be mailed unless such notice has been
given. The Issuer shall have the right to inspect the Registration Books during regular business hours
of the Paying Agent /Registrar, but otherwise the Paying Agent /Registrar shall keep the Registration
Books confidential and, unless otherwise required by law, shall not permit their inspection by any other
entity. The Issuer shall pay the Paying Agent /Registrar's standard or customary fees and charges for
making such registration, transfer, conversion, exchange and delivery of a substitute Bond or Bonds.
Registration of assignments, transfers, conversions and exchanges of Bonds shall be made in the
manner provided and with the effect stated in the FORM OF BOND set forth in this Ordinance. Each
substitute Bond shall bear a letter and/or number to distinguish it from each other Bond.
Except as provided in Section 3(c) of this Ordinance, an authorized representative of the
Paying Agent /Registrar shall, before the delivery of any such Bond, date and manually sign said Bond,
and no such Bond shall be deemed to be issued or outstanding unless such Bond is so executed. The
Paying Agent /Registrar promptly shall cancel all paid Bonds and Bonds surrendered for conversion
and exchange. No additional ordinances, orders, or resolutions need be passed or adopted by the
governing body of the Issuer or any other body or person so as to accomplish the foregoing conversion
and exchange of any Bond or portion thereof, and the Paying Agent /Registrar shall provide for the
printing, execution, and delivery of the substitute Bonds in the manner prescribed herein, and said
Bonds shall be printed or typed on paper of customary weight and strength. Pursuant to Chapter
1201, Government Code, as amended, the duty of conversion and exchange of Bonds as aforesaid is
hereby imposed upon the Paying Agent /Registrar, and, upon the execution of said Bond, the converted
and exchanged Bond shall be valid, incontestable, and enforceable in the same manner and with the
same effect as the Bonds that initially were issued and delivered pursuant to this Ordinance, approved
by the Attorney General and registered by the Comptroller of Public Accounts.
(b) Payment of Bonds and Interest. The Issuer hereby further appoints the Paying
Agent /Registrar to act as the paying agent for paying the principal of and interest on the Bonds, all as
provided in this Ordinance. The Paying Agent /Registrar shall keep proper records of all payments
made by the Issuer and the Paying Agent /Registrar with respect to the Bonds, and of all conversions
and exchanges of Bonds, and all replacements of Bonds, as provided in this Ordinance. However, in
the event of a nonpayment of interest on a scheduled payment date, and for thirty (30) days thereafter,
a new record date for such interest payment (a "Special Record Date ") will be established by the
Paying Agent /Registrar, if and when funds for the payment of such interest have been received from
the Issuer. Notice of the past due interest 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
registered owner appearing on the Registration Books at the close of business on the last business day
next preceding the date of mailing of such notice.
(c) In General. The Bonds (1) shall be issued in fully registered form, without interest coupons,
with the principal of and interest on such Bonds to be payable only to the registered owners thereof,
(ii) may be redeemed prior to their scheduled maturities (notice of which shall be given to the Paying
Agent /Registrar by the Issuer at least 50 days prior to any such redemption date), (iii) may be
converted and exchanged for other Bonds, (iv) may be transferred and assigned, (v) shall have the
characteristics, (vi) shall be signed, sealed, executed and authenticated, (vii) the principal of and
interest on the Bonds shall be payable, and (viii) shall be administered and the Paying Agent /Registrar
and the Issuer shall have certain duties and responsibilities with respect to the Bonds, all as provided,
and in the manner and to the effect as required or indicated, in the FORM OF BOND set forth in this
Ordinance. The Bond initially 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 Bond issued in
conversion of and exchange for any Bond or Bonds issued under this Ordinance the Paying
Agent /Registrar shall execute the PAYING AGENT /REGISTRAR'S AUTHENTICATION
CERTIFICATE, in the form set forth in the FORM OF BOND.
(d) Paying Agent /Registrar for the Bonds. The Issuer covenants with the registered owners
of the Bonds that at all times while the Bonds are outstanding the Issuer will provide a competent and
legally qualified bank, trust company, financial institution, or other entity to act as and perform the
services of Paying Agent /Registrar for the Bonds under this Ordinance, and that the Paying
Agent /Registrar will be one entity. The Issuer reserves the right to, and may, at its option, change the
Paying Agent /Registrar upon not less than 75 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
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promptly it will appoint a competent and legally qualified bank, trust company, financial institution,
or other entity 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 thereof), along with all other pertinent books and records relating to
the Bonds, to the new Paying Agent /Registrar designated and appointed by the Issuer. Upon any
change in the Paying Agent /Registrar, the Issuer promptly will cause a written notice thereof to be sent
by the new Paying Agent /Registrar to each Registered Owner of the Bonds, by United States mail,
first -class postage prepaid, which notice also shall give the address ofthe 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.
(e) Authentication. Except as provided below, no Bond shall be valid or obligatory for any
purpose or be entitled to any security or benefit of this Ordinance unless and until there appears
thereon the Certificate of Paying Agent /Registrar substantially in the form provided in this Ordinance,
duly authenticated by manual execution of the Paying Agent /Registrar. It shall not be required that
the same authorized representative of the Paying Agent /Registrar sign the Certificate of Paying
Agent /Registrar on all of the Bonds. In lieu of the executed Certificate of Paying Agent /Registrar
described above, the Initial Bond delivered on the closing date shall have attached thereto the
Comptroller's Registration Certificate substantially in the form provided in this Ordinance, manually
executed by the Comptroller of Public Accounts of the State of Texas or by his duly authorized agent,
which certificate shall be evidence that the Initial Bond has been duly approved by the Attorney
General of the State of Texas and that it is a valid and binding obligation of the Issuer, and has been
registered by the Comptroller.
(f) Book -Entry Only System. The Bonds issued in exchange for the Bond initially issued to
the initial purchaser specified herein shall be initially issued in the form of a separate single fully
registered Bond for each of the maturities thereof. Upon initial issuance, the ownership of each such
Bond shall be registered in the name of Cede & Co., as nominee of The Depository Trust Company,
New York, New York ( "DTC "), and except as provided in subsection (f) hereof, all of the outstanding
Bonds shall be registered in the name of Cede & Co., as nominee of DTC.
With respect to Bonds registered in the name of Cede & Co., as nominee of DTC, the Issuer
and the Paying Agent /Registrar shall have no responsibility or obligation to any securities brokers and
dealers, banks, trust companies, clearing corporations and certain other organizations on whose behalf
DTC was created ( "DTC Participant ") to hold securities to facilitate the clearance and settlement of
securities transactions among DTC Participants or to any person on behalf of whom such a DTC
Participant holds an interest in the Bonds. Without limiting the immediately preceding sentence, the
Issuer and the Paying Agent /Registrar shall have no responsibility or obligation with respect to (1) the
accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership
interest in the Bonds, (ii) the delivery to any DTC Participant or any other person, other than a
Registered Owner of Bonds, as shown on the Registration Books, of any notice with respect to the
Bonds, or (iii) the payment to any DTC Participant or any other person, other than a Registered Owner
of Bonds, as shown in the Registration Books of any amount with respect to principal of or interest
on the Bonds. Notwithstanding any other provision of this Ordinance to the contrary, the Issuer and
the Paying Agent /Registrar shall be entitled to treat and consider the person in whose name each Bond
is registered in the Registration Books as the absolute owner of such Bond for the purpose ofpayment
ofprincipal and interest with respect to such Bond, for the purpose ofregistering transfers with respect
to such Bond, and for all other purposes whatsoever. The Paying Agent /Registrar shall pay all
principal of and interest on the Bonds only to or upon the order of the Registered Owners, as shown
in the Registration Books as provided in this Ordinance, or their respective attorneys duly authorized
in writing, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's
obligations with respect to payment of principal of and interest on the Bonds to the extent of the sum
or sums so paid. No person other than a Registered Owner, as shown in the Registration Books, shall
receive a Bond evidencing the obligation of the Issuer to make payments of principal and interest
pursuant to this Ordinance. Upon delivery by DTC to the Paying Agent /Registrar of written notice
to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject
to the provisions in this Ordinance with respect to interest checks being mailed to the Registered
Owner at the close of business on the Record date, the words "Cede & Co." in this Ordinance shall
refer to such new nominee of DTC.
The previous execution and delivery of the Blanket Letter of Representations with respect to
obligations of the Issuer is hereby ratified and confirmed; and the provisions thereof shall be fully
applicable to the Bonds.
(g) Successor Securities Depository; Transfers Outside Book -Entry Only System. In the event
that the Issuer determines that DTC is incapable of discharging its responsibilities described herein and
in the representations letter of the Issuer to DTC or that it is in the best interest of the beneficial
owners of the Bonds that they be able to obtain certificated Bonds, the Issuer shall (i) appoint a
successor securities depository, qualified to act as such under Section 17A of the Securities and
Exchange Act of 1934, as amended, notify DTC and DTC Participants of the appointment of such
successor securities depository and transfer one or more separate Bonds to such successor securities
depository or (ii) notify DTC and DTC Participants of the availability through DTC of Bonds and
transfer one or more separate certificated Bonds to DTC Participants having Bonds credited to their
DTC accounts. In such event, the Bonds shall no longer be restricted to being registered in the
Registration Books in the name of Cede & Co., as nominee of DTC, but may be registered in the name
of the successor securities depository, or its nominee, or in whatever name or names Registered
Owners transferring or exchanging Bonds shall designate, in accordance with the provisions of this
Ordinance.
(h) Payments to Cede & Co. Notwithstanding any other provision of this Ordinance to the
contrary, so long as any Bond is registered in the name of Cede & Co., as nominee of DTC, all
payments with respect to principal of and interest on such Bond and all notices with respect to such
Bond shall be made and given, respectively, in the manner provided in the representations letter of the
Issuer to DTC.
(1) Cancellation of Initial Bond. On the closing date, one initial Bond representing the entire
principal amount of the Bonds, payable in stated installments to the purchaser designated in Section
10 or its designee, executed by manual or facsimile signature of the Mayor and City Clerk of the
Issuer, approved by the Attorney General of Texas, and registered and manually signed by the
Comptroller of Public Accounts of the State of Texas, will be delivered to such purchaser or its
designee. Upon payment for the initial Bond, the Paying Agent /Registrar shall cancel the initial Bond
and deliver to the Depository Trust Company on behalf of such purchaser one registered definitive
Bond for each year of maturity of the Bonds, in the aggregate principal amount of all of the Bonds for
such maturity.
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(j) Conditional Notice of Redemption. With respect to any optional redemption of the Bonds,
unless certain prerequisites to such redemption required by this Ordinance have been met and moneys
sufficient to pay the principal of and premium, if any, and interest on the Bonds to be redeemed shall
have been received by the Paying Agent /Registrar prior to the giving of such notice of redemption,
such notice shall state that said redemption may, at the option of the Issuer, be conditional upon the
satisfaction of such prerequisites and receipt of such moneys by the Paying Agent /Registrar on or prior
to the date fixed for such redemption, or upon any prerequisite set forth in such notice of redemption.
If a conditional notice of redemption is given and such prerequisites to the redemption and sufficient
moneys are not received, such notice shall be of no force and effect, the Issuer shall not redeem such
Bonds and the Paying Agent /Registrar shall give notice, in the manner in which the notice of
redemption was given, to the effect that the Bonds have not been redeemed.
Section 4. FORM OF BONDS. The form of the Bonds, including the form of Paying
Agent /Registrar's Authentication Certificate, the form of Assignment and the form of Registration
Certificate of the Comptroller of Public Accounts of the State of Texas to be attached to the Bonds
initially issued and delivered pursuant to this Ordinance, shall be, respectively, substantially as follows,
with such appropriate variations, omissions or insertions as are permitted or required by this
Ordinance.
(a) Form of Bond.
NO. R-
Interest Rate
REGISTERED OWNER:
PRINCIPAL AMOUNT:
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF PARIS, TEXAS
GENERAL OBLIGATION BOND
SERIES 2013
Dated Date Maturity Date
July 1, 2013 December 15,
PRINCIPAL
AMOUNT
CUSIP No.
DOLLARS
ON THE MATURITY DATE specified above, the City of Paris, in Lamar County, Texas (the
"Issuer "), being a political subdivision and municipal corporation of the State of Texas, hereby
promises to pay to the Registered Owner specified above, or registered assigns (hereinafter called the
"Registered Owner "), on the Maturity Date specified above, the Principal Amount specified above.
The Issuer promises to pay interest on the unpaid principal amount hereof (calculated on the basis of
a 360 -day year of twelve 30 -day months) from July 1, 2013 at the Interest Rate per annum specified
above. Interest is payable on December 15, 2013 and semiannually on each June 15 and December
15 thereafter to the Maturity Date specified above, or the date of redemption prior to maturity; except,
if this Bond is required to be authenticated and the date of its authentication is later than the first
Record Date (hereinafter defined), such Principal Amount shall bear interest from the interest payment
date next preceding the date of authentication, unless such date of authentication is after any Record
Date 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; provided, however, that if on the
date of authentication hereof the interest on the Bond or Bonds, if any, for which this Bond is being
exchanged is due but has not been paid, then this Bond shall bear interest from the date to which such
interest has been paid in full.
THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the
United States of America, without exchange or collection charges. The principal of this Bond shall
be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity, or
upon the date fixed for its redemption prior to maturity, at the designated corporate trust office of The
Bank of New York Mellon Trust Company, N.A., in Dallas, Texas, which is the "Paying
Agent /Registrar" for this Bond. The payment of interest on this Bond shall be made by the Paying
Agent /Registrar to the registered owner hereof on each interest payment date by check 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 ordinance authorizing the issuance of this Bond (the 'Bond
Ordinance ") to be on deposit with the Paying Agent /Registrar for such purpose as hereinafter
provided; and such check 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 its
address as it appeared on the last business day of the month preceding each such date (the "Record
Date ") on the Registration Books kept by the Paying Agent /Registrar, as hereinafter described. In
addition, interest may be paid by such other method, acceptable to the Paying Agent /Registrar,
requested by, and at the risk and expense of, the registered owner. In the event of a non - payment of
interest on a scheduled payment date, and for 30 days thereafter, a new record date for such interest
payment (a "Special Record Date ") will be established by the Paying Agent /Registrar, if and when
funds for the payment of such interest have been received from the Issuer. Notice 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 business days prior to the Special Record Date by
United States mail, first -class postage prepaid, to the address of each owner of a Bond appearing on
the Registration Books at the close of business on the last business day next preceding the date of
mailing of such notice.
ANY ACCRUED INTEREST due at maturity or upon the redemption of this Bond prior to
maturity as provided herein shall be paid to the registered owner upon presentation and surrender of
this Bond for redemption and payment at the designated corporate trust office of the Paying
Agent /Registrar. The Issuer covenants with the registered owner of this Bond that on or before each
principal payment date, interest payment date, and accrued interest payment date for this Bond it will
make available to the Paying Agent /Registrar, from the "Interest and Sinking Fund" created by the
Bond Ordinance, the amounts required to provide for the payment, in immediately available funds, of
all principal of and interest on the Bonds, when due.
IF THE DATE for the payment of the principal of or interest on this Bond shall be a Saturday,
Sunday, a legal holiday or a day on which banking institutions in the city where the designated
corporate trust office ofthe 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 that 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.
8
THIS BOND is one of a series of Bonds dated July 1, 2013, authorized in accordance with the
Constitution and laws of the State of Texas in the principal amount of $33,925,000 for the public
purposes of constructing and acquiring improvements and equipping the Issuer's waterworks and
sewer system, to -wit: for replacing and extending water distribution lines and sewer collection lines
and constructing repairs to streets and drainage infrastructure necessitated by such water and sewer
line construction, and to pay the costs incurred in connection with the issuance of the Bonds.
ON DECEMBER 15, 2023, OR ON ANY DATE THEREAFTER, the outstanding Bonds of
this series that mature on and after December 15, 2024 may be redeemed prior to their scheduled
maturities, at the option of the Issuer, with funds derived from any available and lawful source, as a
whole, or in part, and, if in part, the particular Bonds, or portions thereof, to be redeemed shall be
selected and designated by the Issuer (provided that a portion of a Bond may be redeemed only in an
integral multiple of $5,000), at a redemption price equal to the principal amount to be redeemed plus
accrued interest to the date fixed for redemption.
AT LEAST 30 days prior to the date fixed for any redemption of Bonds or portions thereof
prior to maturity a written notice of such redemption shall be sent by the Paying Agent/Registrar by
United States mail, first -class postage prepaid to the registered owner of each Bond to be redeemed
at its address as it appeared on the registration books of the Paying Agent /Registrar at the close of
business on the business day next preceding the date of mailing such notice; provided, however, that
the failure of the registered owner to receive such notice, or any defect therein or in the sending or
mailing thereof, shall not affect the validity or effectiveness of the proceedings for the redemption of
any Bond. By the date fixed for any such redemption due provision shall be made with the Paying
Agent /Registrar for the payment of the required redemption price for the Bonds or portions thereof
that are to be so redeemed. If such written notice of redemption is sent and if due provision for such
payment is made, all as provided above, the Bonds or portions thereof that are to be so redeemed
thereby automatically shall be treated as redeemed prior to their scheduled maturities, and they shall
not bear interest after the date fixed for redemption, and they shall not be regarded as being
outstanding except for the right of the registered owner to receive the redemption price from the
Paying Agent /Registrar out of the funds provided for such payment. If a portion of any Bond shall be
redeemed, a substitute Bond or Bonds having the same maturity date, bearing interest at the same rate,
in any denomination or denominations in any integral multiple of $5,000, at the 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 ofthe Issuer,
all as provided in the Bond Ordinance.
ALL BONDS OF THIS SERIES are issuable solely as fully registered bonds, without interest
coupons, in the denomination of any integral multiple of $5,000. As provided in the Bond Ordinance,
this Bond may, at the request of the registered owner or the assignee or assignees hereof, be assigned,
transferred, converted into and exchanged for a like aggregate principal amount of fully registered
Bonds, without interest coupons, payable to the appropriate registered owner, assignee or assignees,
as the case may be, having the same denomination or denominations in any integral multiple of $5,000
as requested in writing by the appropriate registered owner, assignee or assignees, as the case may be,
upon surrender of this Bond to the Paying Agent /Registrar for cancellation, all in accordance with the
form and procedures set forth in the Bond Ordinance. Among other requirements for such assignment
and transfer, this Bond must be presented and surrendered to the Paying Agent /Registrar, together
with proper instruments of assignment, in form and with guarantee of signatures satisfactory to the
Paying Agent /Registrar, evidencing assignment of this Bond or any portion or portions hereof in any
integral multiple of $5,000 to the assignee or assignees in whose name or names this Bond or any such
portion or portions hereof is or are to be registered. The form of Assignment printed or endorsed on
this Bond may be executed by the registered owner to evidence the assignment hereof, but such
method is not exclusive, and other instruments of assignment satisfactory to the Paying
Agent /Registrar maybe used to evidence the assignment of this Bond or any portion or portions hereof
from time to time by the registered owner. The Paying Agent /Registrar's reasonable standard or
customary fees and charges for assigning, transferring, converting and exchanging any Bond or portion
thereof will be paid by the Issuer. In any circumstance, any taxes or governmental charges required
to be paid with respect thereto shall be paid by the one requesting such assignment, transfer,
conversion or exchange, as a condition precedent to the exercise of such privilege. The Paying
Agent/Registrar shall not be required to make any such transfer, 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 Bond
or any portion thereof called for redemption prior to maturity, within 45 days prior to its redemption
date.
IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the Issuer, resigns,
or otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly
will appoint a competent and legally qualified substitute therefor, and cause written notice thereof to
be mailed to the registered owners of the Bonds.
IT IS HEREBY certified, recited and covenanted that this Bond has been duly and validly
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 Bond
have been performed, existed and been done in accordance with law; and that annual ad valorem taxes
sufficient to provide for the payment of the interest on and principal of this Bond, as such interest
comes due and such principal matures, have been levied and ordered to be levied against all taxable
property in said Issuer, and have been pledged for such payment, within the limit prescribed by law.
THE ISSUER HAS RESERVED THE RIGHT to amend the Bond Ordinance as provided-
therein, and under some (but not all) circumstances amendments thereto must be approved by the
registered owners of a majority in aggregate principal amount of the outstanding Bonds.
BY BECOMING the registered owner of this Bond, the registered owner thereby
acknowledges all ofthe terms and provisions ofthe Bond Ordinance, agrees to be bound by such terms
and provisions, acknowledges that the Bond Ordinance is duly recorded and available for inspection
in the official minutes and records of the governing body of the Issuer, and agrees that the terms and
provisions of this Bond and the Bond Ordinance constitute a contract between each registered owner
hereof and the Issuer.
IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or
facsimile signature of the Mayor of the Issuer (or in the Mayor's absence, by the Mayor Pro -Tem) and
countersigned with the manual or facsimile signature of the City Clerk of the Issuer, and has caused
the official seal of the Issuer to be duly impressed, or placed in facsimile, on this Bond.
(signature) (signature)
Janice Ellis, City Clerk A.J. Hashmi, M.D., Mayor
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(SEAL)
(b) Form of Paying Agent /Registrar's Authentication Certificate.
PAYING AGENT /REGISTRAR'S AUTHENTICATION CERTIFICATE
(To be executed if this Bond is not accompanied by an executed Registration
Certificate of the Comptroller of Public Accounts of the State of Texas)
It is hereby certified that this Bond has been issued under the provisions of the Bond Ordinance
described in the text of this Bond; and that this Bond has been issued in conversion or replacement of,
or in exchange for, a Bond, Bonds, or a portion of a Bond or Bonds of a series that 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:
(c) Form of Assignment.
The Bank of New York Mellon Trust Company, N.A.
Dallas, Texas
Paying Agent /Registrar
011A
Authorized Representative
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
Please insert Social Security or Taxpayer Identification Number of Transferee:
Please print or typewrite name and address, including zip code of Transferee:
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
attorney, to register the transfer of the
within Bond on the books kept for registration thereof, with full power of substitution in the premises.
Dated:
Signature Guaranteed:
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NOTICE: Signature(s) must be guaranteed by an NOTICE: The signature above must correspond
eligible guarantor institution participating in a with the name of the Registered Owner as it
securities transfer association recognized appears upon the front of this Bond in every
signature guarantee program. particular, without alteration or enlargement or
any change whatsoever.
(d) Form of Registration Certificate of the Comptroller of Public Accounts.
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO.
I hereby certify that this Bond has been examined, certified as to validity and approved by the
Attorney General of the State of Texas, and that this Bond has been registered by the Comptroller of
Public Accounts of the State of Texas.
Witness my signature and seal this
Comptroller of Public Accounts of the State of Texas
(COMPTROLLER'S SEAL)
(e) Initial Bond Insertions.
(i) The initial Bond shall be in the form set forth is paragraph (a) of this Section,
except that:
A. immediately under the name of the Bond, the headings "Interest Rate" and
"Maturity Date" shall both be completed with the words "As shown below" and
"CUSIP No. " shall be deleted.
B. the first paragraph shall be deleted and the following will be inserted:
"THE CITY OF PARIS, TEXAS, in Lamar County, Texas (the "Issuer "), being a political
subdivision and municipal corporation of the State of Texas, hereby promises to pay to the Registered
Owner specified above, or registered assigns (hereinafter called the "Registered Owner "), on December
15 in each ofthe years, in the principal installments and bearing interest at the per annum rates set forth
in the following schedule:
Principal
Years Installments Interest Rates
(Information from Section 2 to be inserted)
The Issuer promises to pay interest on the unpaid principal amount hereof (calculated on the basis of
a 360 -day year of twelve 30 -day months) from July 1, 2013 at the respective Interest Rate per annum
specified above. Interest is payable on December 15, 2013, and semiannually on each June 15 and
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December 15 thereafter to the date ofpayment of the principal installment specified above, or the date
of redemption prior to maturity; except, that if this Bond is required to be authenticated and the date
of its authentication is later than the first Record Date (hereinafter defined), such Principal Amount
shall bear interest from the interest payment date next preceding the date of authentication, unless such
date of authentication is after any Record Date 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; provided, however, that if on the date of authentication hereofthe interest on the Bond or Bonds,
if any, for which this Bond is being exchanged is due but has not been paid, then this Bond shall bear
interest from the date to which such interest has been paid in full."
C. The Initial Bond shall be numbered "T -1."
Section 5. INTEREST AND SINKING FUND.
(a) A special "Interest and Sinking Fund" is hereby created and shall be established and
maintained by the Issuer at an official depository bank of said Issuer. Said Interest and Sinking Fund
shall be kept separate and apart from all other funds and accounts of said Issuer, and shall be used only
for paying the interest on and principal of said Bonds. All amounts received from the sale of the Bonds
as accrued interest shall be deposited upon receipt to the Interest and Sinking Fund, and all ad valorem
taxes levied and collected for and on account of said Bonds shall be deposited, as collected, to the
credit of said Interest and Sinking Fund. During each year while any of said Bonds are outstanding
and unpaid, the governing body of said Issuer shall compute and ascertain a rate and amount of ad
valorem tax that will be sufficient to raise and produce the money required to pay the interest on said
Bonds as such interest comes due, and to provide and maintain a sinking fund adequate to pay the
principal of said Bonds as such principal matures (but never less than 2% ofthe original amount of said
Bonds as a sinking fund each year); and said tax shall be based on the latest approved tax rolls of said
Issuer, with full allowances being made for tax delinquencies and the cost of tax collection. Said rate
and amount of ad valorem tax is hereby levied, and is hereby ordered to be levied, against all taxable
property in said Issuer, for each year while any of said Bonds 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 said Bonds, as such interest comes due and such principal matures, are hereby pledged for
such payment, within the limit prescribed by law. Notwithstanding the requirements of this subsection,
if lawfully available moneys of the Issuer are actually on 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 that otherwise would have been required to be levied pursuant to this Section may be reduced
to the extent and by the amount of the lawfully available funds then on deposit in the Interest and
Sinking Fund.
(b) Chapter 1208, Government Code, applies to the issuance of the Bonds and the pledge of
the taxes granted by the Issuer under this Section, and is therefore valid, effective, and perfected.
Should Texas law be amended at any time while the Bonds are outstanding and unpaid, the result of
such amendment being that the pledge of the taxes granted by the Issuer under this Section is to be
subject to the filing requirements of Chapter 9, Business & Commerce Code, in order to preserve to
the registered owners of the Bonds a security interest in said pledge, the Issuer agrees to take such
measures as it determines are reasonable and necessary under Texas law to comply with the applicable
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provisions of Chapter 9, Business & Commerce Code and enable a filing of a security interest in said
pledge to occur.
Section 6. DEFEASANCE OF BONDS.
(a) Any Bond and the interest thereon shall be deemed to be paid, retired and no longer
outstanding (a "Defeased Bond ") within the meaning of this Ordinance, except to the extent provided
in subsection (d) of this Section, when payment of the principal of such Bond, plus interest thereon
to the due date (whether such due date be by reason of maturity or otherwise) either (i) shall have been
made or caused to be made in accordance with the terms thereof, 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 in accordance with an escrow agreement or other instrument (the "Future Escrow
Agreement ") for such payment (1) lawful money of the United States of America sufficient to make
such payment or (2) Defeasance Securities that mature as to principal and interest in such amounts and
at such times as will insure the availability, without reinvestment, of sufficient money to provide for
such payment, and when proper arrangements have been made by the Issuer with the Paying
Agent /Registrar for the payment of its services until all Defeased Bonds shall have become due and
payable. At such time as a Bond shall be deemed to be a Defeased Bond hereunder, as aforesaid, such
Bond and the interest thereon shall no longer be secured by, payable from, or entitled to the benefits
of, the ad valorem taxes herein levied and pledged as provided in this Ordinance, and such principal
and interest shall be payable solely from such money or Defeasance Securities. Notwithstanding any
other provision of this Ordinance to the contrary, it is hereby provided that any determination not to
redeem Defeased Bonds that is made in conjunction with the payment arrangements specified in
Subsection (a)(i) or (ii) of this Section shall not be irrevocable, provided that: (1) in the proceedings
providing for such payment arrangements, the Issuer expressly reserves the right to call the Defeased
Bonds for redemption; (2) gives notice of the reservation of that right to the owners of the Defeased
Bonds immediately following the making of the payment arrangements; and (3) directs that notice of
the reservation be included in any redemption notices that it authorizes.
(b) Any moneys so deposited with the Paying Agent /Registrar may at the written direction of
the Issuer be invested in Defeasance Securities, maturing in the amounts and times as hereinbefore set
forth, and all income from such Defeasance Securities received by the Paying Agent /Registrar that is
not required for the payment of the Bonds and interest thereon, with respect to which such money has
been so deposited, shall be turned over to the Issuer, or deposited as directed in writing by the Issuer.
Any Future Escrow Agreement pursuant to which the money and/or Defeasance Securities are held
for the payment of Defeased Bonds may contain provisions permitting the investment or reinvestment
of such moneys in Defeasance Securities or the substitution of other Defeasance Securities upon the
satisfaction of the requirements specified in Subsection (a)(i) or (ii) of this Section. All income from
such Defeasance Securities received by the Paying Agent /Registrar which is not required for the
payment of the Defeased Bonds, with respect to which such money has been so deposited, shall be
remitted to the Issuer or deposited as directed in writing by the Issuer.
(c) The term " Defeasance Securities" means any securities and obligations now or hereafter
authorized by State law that are eligible to refund, retire or otherwise discharge obligations such as
the Bonds.
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(d) Until all Defeased Bonds shall have become due and payable, the Paying Agent /Registrar
shall perform the services of Paying Agent /Registrar for such Defeased Bonds the same as if they had
not been defeased, and the Issuer shall make proper arrangements to provide and pay for such services
as required by this Ordinance.
(e) In the event that the Issuer elects to defease less than all of the principal amount of Bonds
of a maturity, the Paying Agent /Registrar shall select, or cause to be selected, such amount of Bonds
by such random method as it deems fair and appropriate.
Section 7. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS.
(a) Replacement Bonds. In the event any outstanding Bond is damaged, mutilated, lost, stolen
or destroyed, the Paying Agent /Registrar shall cause to be printed, executed and delivered, a new
Bond of the same principal amount, maturity and interest rate, as the damaged, mutilated, lost, stolen
or destroyed Bond, in replacement for such Bond in the manner hereinafter provided.
(b) Application for Replacement Bonds. Application for replacement of damaged, mutilated,
lost, stolen or destroyed Bonds shall be made by the registered owner thereof to the Paying
Agent /Registrar. In every case of loss, theft or destruction of a Bond, the registered owner applying
for a replacement Bond shall furnish to the Issuer and to the Paying 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 Bond, the registered owner shall
furnish to the Issuer and to the Paying Agent /Registrar evidence to their satisfaction of the loss, theft
or destruction of such Bond, as the case may be. In every case of damage or mutilation of a Bond,
the registered owner shall surrender to the Paying Agent/Registrar for cancellation the Bond so
damaged or mutilated.
(c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the
event any such Bond shall have matured, and no default has occurred that is then continuing in the
payment of the principal of, redemption premium, if any, or interest on the Bond, the Issuer may
authorize the payment of the same (without surrender thereof except in the case of a damaged or
mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished
as above provided in this Section.
(d) Charge for Issuing Replacement Bonds. Prior to the issuance of any replacement Bond,
the Paying Agent /Registrar shall charge the registered owner of such Bond with all legal, printing, and
other expenses in connection therewith. Every replacement Bond issued pursuant to the provisions
of this Section by virtue of the fact that any Bond is lost, stolen or destroyed shall constitute a
contractual obligation of the Issuer whether or not the lost, stolen or destroyed Bond shall be found
at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Ordinance
equally and proportionately with any and all other Bonds duly issued under this Ordinance.
(e) Authority for Issuing Replacement Bonds. In accordance with Sec. 1206.022, Government
Code, this Section 7 of this Ordinance shall constitute authority for the issuance of any such
replacement Bond 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 Bonds is hereby authorized and imposed upon
the Paying Agent /Registrar, and the Paying Agent /Registrar shall authenticate and deliver such Bonds
15
in the form and manner and with the effect, as provided in Section 3(a) of this Ordinance for Bonds
issued in conversion and exchange for other Bonds.
Section 8. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND
COUNSEL'S OPINION; CUSIP NUMBERS AND CONTINGENT INSURANCE PROVISION, IF
OBTAINED; ENGAGEMENT OF BOND COUNSEL.
(a) The Mayor of the Issuer is hereby authorized to have control of the Bonds initially issued
and delivered hereunder and all necessary records and proceedings pertaining to the Bonds pending
their delivery and their 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 Accounts (or a deputy designated in writing to
act for said Comptroller) shall manually sign the Comptroller's Registration Certificate attached to such
Bonds, and the seal of said Comptroller shall be impressed, or placed in facsimile, on such Bond. The
approving legal opinion of the Issuer's Bond Counsel and the assigned CUSIP numbers may, at the
option of the Issuer, be printed on the Bonds issued and delivered under this Ordinance, but neither
shall have any legal effect, and shall be solely for the convenience and information of the registered
owners of the Bonds. In addition, if bond insurance is obtained, the Bonds may bear an appropriate
legend as provided by the insurer.
(b) The obligation of the initial purchaser to accept delivery of the Bonds is subject to the
initial purchaser being furnished with the final, approving opinion of McCall, Parkhurst & Horton
L.L.P., bond counsel to the Issuer, which opinion shall be dated as of and delivered on the date of
initial delivery of the Bonds to the initial purchaser. The engagement of such firm as bond counsel to
the Issuer in connection with issuance, sale and delivery of the Bonds is hereby approved and
confirmed. The execution and delivery of an engagement letter between the Issuer and such firm, with
respect to such services as bond counsel, is hereby authorized in such form as may be approved by the
Mayor or the City Manager, and the Mayor or the City Manager is hereby authorized to execute such
engagement letter. In addition, the execution and delivery of a professional services agreement
between the Issuer and Southwest Securities, Inc., with respect to services as Financial Advisor to the
Issuer, is hereby authorized in such form as may be approved by the Mayor and the Mayor is hereby
authorized to execute such agreement.
Section 9. COVENANTS REGARDING TAX EXEMPTION OF INTEREST ON THE
BONDS.
(a) Covenants. The Issuer covenants to take any action necessary to assure, or refrain from
any action that would adversely affect, the treatment of the Bonds as obligations described in section
103 of 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:
(1) to take any action to assure that no more than 10 percent of the proceeds of the
Bonds (less amounts deposited to a reserve fund, if any) are used for any "private business
use," as defined in section 141(b)(6) of the Code or, if more than 10 percent of the proceeds
or the Project are so used, such amounts, whether or not received by the Issuer, with respect
to such private business use, do not, under the terms of this Ordinance or any underlying
16
arrangement, directly or indirectly, secure or provide for the payment of more than 10 percent
of the debt service on the Bonds, in contravention of section 141(b)(2) of the Code;
(2) to take any action to assure that in the event that the "private business use"
described in subsection (1) hereof exceeds 5 percent of the proceeds of the Bonds or the
projects financed therewith (less amounts deposited into a reserve fund, ifany) then the amount
in excess of 5 percent is used for a "private business use" that is "related" and not
"disproportionate," within the meaning of section 141(b)(3) of the Code, to the governmental
use;
(3) to take any action to assure that no amount that is greater than the lesser of
$5,000,000, or 5 percent of the proceeds of the Bonds (less amounts deposited into a reserve
fund, if any) is directly or indirectly used to finance loans to persons, other than state or local
governmental units, in contravention of section 141(c) of the Code;
(4) to refrain from taking any action that would otherwise result in the Bonds being
treated as "private activity bonds" within the meaning of section 141(b) of the Code;
(5) to refrain from taking any action that would result in the Bonds being "federally
guaranteed" within the meaning of section 149(b) of the Code;
(6) to refrain from using any portion of the proceeds of the Bonds, directly or
indirectly, to acquire or to replace funds that were used, directly or indirectly, to acquire
investment property (as defined in section 148(b)(2) of the Code) that produces a materially
higher yield over the term of the Bonds, other than investment property acquired with —
(A) proceeds of the Bonds invested for a reasonable temporary period until
such proceeds are needed for the purpose for which the bonds are issued,
(B) amounts invested in a bona fide debt service fund, within the meaning of
section 1.148 -1(b) of the Treasury Regulations, and
(C) 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 Bonds;
(7) to otherwise restrict the use of the proceeds of the Bonds or amounts treated as
proceeds of the Bonds, as may be necessary, so that the Bonds do not otherwise contravene
the requirements of section 148 of the Code (relating to arbitrage) and, to the extent
applicable, section 149(d) of the Code (relating to advance refundmgs); and
(8) to pay to the United States of America at least once during each five -year period
(beginning on the date of delivery of the Bonds) an amount that is at least equal to 90 percent
of the 'Excess Earnings," within the meaning of section 148(f) of the Code and to pay to the
United States of America, not later than 60 days after the Bonds have been paid in full, 100
percent of the amount then required to be paid as a result of Excess Earnings under section
148(f) of the Code.
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(b) Rebate Fund. In order to facilitate compliance with the above covenant (a)(8), 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.
(c) Use of Proceeds. For purposes of the foregoing covenants (a)(1) and (a)(2), the Issuer
understands that the term "proceeds" includes "disposition proceeds" as defined in the Treasury
Regulations. 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
that modify or expand provisions of the Code, as applicable to the Bonds, the Issuer will not be
required to comply with any covenant contained herein to the extent that such failure to comply, in the
opinion of nationally recognized bond counsel, will not adversely affect the exemption from federal
income taxation of interest on the Bonds under section 103 of the Code. In the event that regulations
or rulings are hereafter promulgated that impose additional requirements applicable to the Bonds, the
Issuer agrees to comply with the additional requirements to the extent necessary, in the opinion of
nationally recognized bond counsel, to preserve the exemption from federal income taxation of interest
on the Bonds under section 103 of the Code. In furtherance of such intention, the Issuer hereby
authorizes and directs the Mayor, the City Manager or the Finance Director to execute any documents,
certificates or reports required by the Code and to make such elections, on behalf of the Issuer, that
may be permitted by the Code as are consistent with the purpose for the issuance of the Bonds.
(d) Disposition of Projects. The Issuer covenants that the Projects will not be sold or
otherwise disposed in a transaction resulting in the receipt by the Issuer of cash or other compensation,
unless the Issuer obtains an opinion of nationally - recognized bond counsel that such sale or other
disposition will not adversely affect the tax - exempt status of the Bonds. For purposes of the
foregoing, the portion of the property comprising personal property and disposed in the ordinary
course shall not be treated as a transaction resulting in the receipt of cash or other compensation. For
purposes hereof, the Issuer shall not be obligated to comply with this covenant if it obtains a legal
opinion that such failure to comply will not adversely affect the excludability for federal income tax
proposes from gross income of the interest.
Section 10. SALE OF BONDS AND APPROVAL OF OFFICIAL STATEMENT;
FURTHER PROCEDURES.
(a) The Bonds are hereby sold and shall be delivered to RBC Capital Markets, LLC, First
Southwest Company, Bosc, Inc., Raymond James & Associates, Inc. and Morgan Stanley & Company,
Inc. (the "Underwriters ") for the purchase price of $35,186,748.71 (representing the par amount of
the Bonds of $33,925,000, plus a net original issue premium of $1,472,799.85 and less an
Underwriters' discount on the Bonds of $211,051.14) plus accrued interest (accrued interest to be
deposited into the Interest and Sinking Fund) thereon to date of delivery pursuant to the terms and
provisions of a Purchase Agreement with the Underwriters. It is hereby officially found, determined,
and declared that the Bonds have been sold pursuant to the terms and provisions of a Purchase
Agreement in substantially the form presented at this meeting, which the Mayor of the Issuer is hereby
authorized and directed to execute. It is hereby officially found, determined, and declared that the
18
terms of this sale are the most advantageous reasonably obtainable. The Initial Bond shall be
registered in the name of RBC Capital Markets, LLC or its designee.
(b) The Issuer hereby approves the form and content of the Official Statement relating to the
Bonds and any addenda, supplement or amendment thereto, and approves the distribution of such
Official Statement in the reoffering of the Bonds by the Underwriters in final form, with such changes
therein or additions thereto as the officer executing the same may deem advisable, such determination
to be conclusively evidenced by his execution thereof. The distribution and use of the Preliminary
Official Statement posted and disseminated July 3, 2013, prior to the date hereof is hereby ratified and
confirmed.
(c) The Mayor and Mayor Pro -Tem, the City Manager, the Finance Director and City Clerk
and all other officers, employees and agents of the Issuer, and each of them, shall be and they are
hereby expressly authorized, empowered and directed from time to time and at any time to do and
perform all such acts and things and to execute, acknowledge and deliver in the name and on behalf
of the Issuer a Paying Agent /Registrar Agreement with the Paying Agent /Registrar, and all other
instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out
the terms and provisions of this Ordinance, the Bonds, the sale of the Bonds and the Official
Statement. In case any officer whose signature shall appear on any Bond shall cease to be such officer
before the delivery of such Bond, such signature shall nevertheless be valid and sufficient for all
purposes the same as if such officer had remained in office until such delivery.
Section 11. DEFAULT AND REMEDIES
(a) Events of Default. Each of the following occurrences or events for the purpose of this
Ordinance is hereby declared to be an Event of Default:
(i) the failure to make payment of the principal of or interest on any of the Bonds when
the same becomes due and payable; or
(ii) default in the performance or observance of any other covenant, agreement or
obligation of the Issuer, the failure to perform which materially, adversely affects the rights of
the registered owners of the Bonds, including, but not limited to, their prospect or ability to
be repaid in accordance with this Ordinance, and the continuation thereof for a period of 60
days after notice of such default is given by any Registered Owner to the Issuer.
(b) Remedies for Default.
(i) Upon the happening of any Event of Default, then and in every case, any Registered
Owner or an authorized representative thereof, including, but not limited to, a trustee or
trustees therefor, may proceed against the Issuer for the purpose of protecting and enforcing
the rights of the Registered Owners under this Ordinance, by mandamus or other suit, action
or special proceeding in equity or at law, in any court of competent jurisdiction, for any relief
permitted by law, including the specific performance of any covenant or agreement contained
herein, or thereby to enjoin any act or thing that may be unlawful or in violation of any right
of the Registered Owners hereunder or any combination of such remedies.
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(ii) It is provided that all such proceedings shall be instituted and maintained for the
equal benefit of all Registered Owners of Bonds then outstanding.
(c) Remedies Not Exclusive.
(i) No remedy herein conferred or reserved is intended to be exclusive of any other
available remedy or remedies, but each and every such remedy shall be cumulative and shall
be in addition to every other remedy given hereunder or under the Bonds or now or hereafter
existing at law or in equity; provided, however, that notwithstanding any other provision ofthis
Ordinance, the right to accelerate the debt evidenced by the Bonds shall not be available as a
remedy under this Ordinance.
(ii) The exercise of any remedy herein conferred or reserved shall not be deemed a
waiver of any other available remedy.
(iii) By accepting the delivery of a Bond authorized under this Ordinance, such
Registered Owner agrees that the certifications required to effectuate any covenants or
representations contained in this Ordinance do not and shall never constitute or give rise to a
personal or pecuniary liability or charge against the officers, employees or councilmembers of
the Issuer.
Section 12. COMPLIANCE WITH RULE 15c2 -12.
(a) Definitions. As used in this Section, the following terms have the meanings
ascribed to such terms below:
"MSRB" means the Municipal Securities Rulemaking Board.
"Rule" means SEC Rule 15c2 -12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
(b) Annual Reports. (i) The Issuer shall provide annually to the MSRB, in the electronic
format prescribed by the MSRB, within six months after the end of each fiscal year commencing in
2013, financial information and operating data with respect to the Issuer of the general type included
in the final Official Statement authorized by this Ordinance, being the information described in Exhibit
A attached hereto. Any financial statements so to be provided shall be (1) prepared in accordance with
the accounting principles described in the financial statements of the Issuer appended to the Official
Statement, or such other accounting principles as the Issuer may be required to employ from time to
time pursuant to state law or regulation, and (2) audited, if the Issuer commissions an audit of such
statements and the audit is completed within the period during which they must be provided. If the
audit of such financial statements is not completed within such period, then the Issuer shall provide
unaudited financial information within such period, and audited financial statements for the applicable
fiscal year to the MSRB, when and if the audit report on such statements become available.
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(ii) If the Issuer changes its fiscal year, it will notify the MSRB of the change (and of the date
of the new fiscal year end) prior to the next date by which the Issuer otherwise would be required to
provide financial information and operating data pursuant to this Section. The financial information
and operating data to be provided pursuant to this Section may be set forth in full in one or more
documents or may be included by specific reference to any documents available to the public on the
MSRB's internet website or filed with the SEC.
(c) Event Notices. The Issuer shall notify the MSRB, in a timely manner not in excess of ten
Business Days after the occurrence of the event, of any of the following events with respect to the
Bonds:
1. Principal and interest payment delinquencies;
2. Non - payment related defaults, if material;
3. Unscheduled draws on debt service reserves reflecting financial difficulties;
4. Unscheduled draws on credit enhancements reflecting financial difficulties;
5. Substitution of credit or liquidity providers, or their failure to perform;
6. Adverse tax opinions, the issuance by the Internal Revenue Service ofproposed or final
determinations oftaxability, Notices ofProposed Issue (IRS Form 5701 -TEB) or other
material notices or determinations with respect to the tax status of the Bonds, or other
material events affecting the tax status of the Bonds;
7. Modifications to rights of holders of the Bonds, if material;
8. Bond calls, if material, and tender offers;
9. Defeasances;
10. Release, substitution, or sale of property securing repayment of the Bonds, if material;
11. Rating changes;
12. Bankruptcy, insolvency, receivership or similar event of the Issuer;
13. The consummation of a merger, consolidation, or acquisition involving the Issuer or
the sale of all or substantially all of the assets of the Issuer, other than in the ordinary
course of business, the entry into a definitive agreement to undertake such an action
or the termination of a definitive agreement relating to any such actions, other than
pursuant to its terms, if material; and
14. Appointment of a successor Paying Agent /Registrar or change in the name of the
Paying Agent /Registrar, if material.
The Issuer shall notify the MSRB, in a timely manner, of any failure by the Issuer to provide financial
information or operating data in accordance with subsection (c) of this Section by the time required
by subsection (c). As used in clause (c) 12 above, the phrase "bankruptcy, insolvency, receivership or
similar event" means the appointment of a receiver, fiscal agent or similar officer for the Issuer in a
proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in
which a court of governmental authority has assumed jurisdiction over substantially all of the assets
or business of the Issuer, or if jurisdiction has been assumed by leaving the Board and officials or
officers of the Issuer in possession but subject to the supervision and orders of a court or governmental
authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by
a court or governmental authority having supervision or jurisdiction over substantially all of the assets
or business of the Issuer.
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(d) Limitations, Disclaimers, and Amendments. (i) The Issuer shall be obligated to observe
and perform the covenants specified in this Section for so long as, but only for so long as, the Issuer
remains an "obligated person" with respect to the Bonds within the meaning of the Rule, except that
the Issuer in any event will give notice of any deposit made in accordance with this Ordinance or
applicable law that causes the Bonds no longer to be outstanding.
(ii) The provisions of this Section are for the sole benefit of the registered owners and
beneficial owners of the Bonds, and nothing in this Section, express or implied, shall give any benefit
or any legal or equitable right, remedy, or claim hereunder to any other person. The Issuer undertakes
to provide only the financial information, operating data, financial statements, and notices which it has
expressly agreed to provide pursuant to this Section and does not hereby undertake to provide any
other information that may be relevant or material to a complete presentation of the Issuer's financial
results, condition, or prospects or hereby undertake to update any information provided in accordance
with this Section or otherwise, except as expressly provided herein. The Issuer does not make any
representation or warranty concerning such information or its usefulness to a decision to invest in or
sell Bonds at any future date.
(iii) UNDER NO CIRCUMSTANCES SHALL THE ISSUER BE LIABLE TO THE
REGISTERED OWNER OR BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON,
IN CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM
ANY BREACH BY THE ISSUER, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS
PART, OF ANY COVENANT SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND
REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF
ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC
PERFORMANCE.
(iv) No default by the Issuer in observing or performing its obligations under this Section shall
comprise a breach of or default under the Ordinance for purposes of any other provision of this
Ordinance. Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the
duties of the Issuer under federal and state securities laws.
(v) The provisions of this Section may be amended by the Issuer from time to time to adapt
to changed circumstances that arise from a change in legal requirements, a change in law, or a change
in the identity, nature, status, or type of operations of the Issuer, but only if (1) the provisions of this
Section, as so amended, would have permitted an underwriter to purchase or sell Bonds in the primary
offering of the Bonds in compliance with the Rule, taking into account any amendments or
interpretations of the Rule since such offering as well as such changed circumstances and (2) either (a)
the registered owners of a majority in aggregate principal amount (or any greater amount required by
any other provision of this Ordinance that authorizes such an amendment) of the outstanding Bonds
consent to such amendment or (b) a person that is unaffiliated with the Issuer (such as nationally
recognized bond counsel) determined that such amendment will not materially impair the interest of
the registered owners and beneficial owners of the Bonds. If the Issuer so amends the provisions of
this Section, it shall include with any amended financial information or operating data next provided
in accordance with subsection (b) of this Section an explanation, in narrative form, of the reason for
the amendment and of the impact of any change in the type of financial information or operating data
so provided. The Issuer may also amend or repeal the provisions of this continuing disclosure
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agreement if the SEC amends or repeals the applicable provision of the Rule or a court of final
jurisdiction enters judgment that such provisions of the Rule are invalid, but only if and to the extent
that the provisions of this sentence would not prevent an underwriter from lawfully purchasing or
selling Bonds in the primary offering of the Bonds.
Section 13. METHOD OF AMENDMENT. The Issuer hereby reserves the right to amend
this Ordinance subject to the following terms and conditions, to -wit:
(a) The Issuer may from time to time, without the consent of any holder, except as otherwise
required by paragraph (b) below, amend or supplement this Ordinance in order to (i) cure any
ambiguity, defect or omission in this Ordinance that does not materially adversely affect the interests
of the holders, (ii) grant additional rights or security for the benefit of the holders, (iii) add events of
default as shall not be inconsistent with the provisions of this Ordinance and that shall not materially
adversely affect the interests of the holders, (iv) qualify this Ordinance under the Trust Indenture Act
of 1939, as amended, or corresponding provisions of federal laws from time to time in effect, or (v)
make such other provisions in regard to matters or questions arising under this Ordinance as shall not
be inconsistent with the provisions of this Ordinance and that shall not in the opinion of the Issuer's
Bond Counsel materially adversely affect the interests of the holders.
(b) Except as provided in paragraph (a) above, the holders of Bonds aggregating in principal
amount 51 % of the aggregate principal amount of then outstanding Bonds that are the subject of a
proposed amendment shall have the right from time to time to approve any amendment hereto that may
be deemed necessary or desirable by the Issuer; provided, however, that without the consent of 100%
of the holders in aggregate principal amount of the then outstanding Bonds, nothing herein contained
shall permit or be construed to permit amendment of the terms and conditions of this Ordinance or in
any of the Bonds so as to:
(1) Make any change in the maturity of any of the outstanding Bonds;
(2) Reduce the rate of interest borne by any of the outstanding Bonds;
(3) Reduce the amount of the principal of, or redemption premium, if any, payable on
any outstanding Bonds;
(4) Modify the terms of payment of principal or of interest or redemption premium
on outstanding Bonds or any of them or impose any condition with respect to such
payment; or
(5) Change the minimum percentage of the principal amount of any series of Bonds
necessary for consent to such amendment.
(c) If at any time the Issuer shall desire to amend this Ordinance under this Section, the Issuer
shall send by U.S. mail to each registered owner of the affected Bonds a copy of the proposed
amendment and cause notice of the proposed amendment to be published at least once in a financial
publication published in The City of New York, New York or in the State of Texas. Such published
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notice shall briefly set forth the nature of the proposed amendment and shall state that a copy thereof
is on file at the office of the Issuer for inspection by all holders of such Bonds.
(d) Whenever at any time within one year from the date ofpublication of such notice the Issuer
shall receive an instrument or instruments executed by the holders of at least 51% in aggregate
principal amount of all of the Bonds then outstanding that are required for the amendment, which
instrument or instruments shall refer to the proposed amendment and that shall specifically consent to
and approve such amendment, the Issuer may adopt the amendment in substantially the same form.
(e) Upon the adoption of any amendatory Ordinance pursuant to the provisions ofthis Section,
this Ordinance shall be deemed to be modified and amended in accordance with such amendatory
Ordinance, and the respective rights, duties, and obligations of the Issuer and all holders of such
affected Bonds shall thereafter be determined, exercised, and enforced, subject in all respects to such
amendment.
(f) Any consent given by the holder of a Bond pursuant to the provisions of this Section shall
be irrevocable for a period of six months from the date of the publication of the notice provided for
in this Section, and shall be conclusive and binding upon all future holders of the same Bond during
such period. Such consent may be revoked at any time after six months from the date of the
publication of said notice by the holder who gave such consent, or by a successor in title, by filing
notice with the Issuer, but such revocation shall not be effective if the holders of 51 % in aggregate
principal amount of the affected Bonds then outstanding, have, prior to the attempted revocation,
consented to and approved the amendment.
For the purposes of establishing ownership of the Bonds, the Issuer shall rely solely upon the
registration of the ownership of such Bonds on the registration books kept by the Paying
Agent /Registrar.
Section 14. EFFECTIVE DATE. In accordance with the provisions of Texas Government
Code, Section 1201.028, this Ordinance shall be effective immediately upon its adoption by the City
Council.
Section 15. ALLOCATION OF, AND LIMITATION ON, EXPENDITURES FOR THE
PROJECT. The Issuer covenants to account for the expenditure of sale proceeds and investment
earnings to be used for the construction and acquisition of the Project on its books and records by
allocating proceeds to expenditures within 18 months of the later of the date that (1) the expenditure
is made, or (2) the Project is completed. The foregoing notwithstanding, the Issuer shall not expend
proceeds of the sale of the Bonds or investment earnings thereon more than 60 days after the earlier
of (1) the fifth anniversary of the delivery of the Bonds, or (2) the date the Bonds are retired, unless
the Issuer obtains an opinion of nationally - recognized bond counsel that such expenditure will not
adversely affect the status, for federal income tax purposes, of the Bonds or the interest thereon. For
purposes hereof, the Issuer shall not be obligated to comply with this covenant if it obtains an opinion
that such failure to comply will not adversely affect the excludability for federal income tax purposes
from gross income of the interest.
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Section 16. INTEREST EARNINGS ON BOND PROCEEDS. Interest earnings derived from
the investment of proceeds from the sale of the Bonds shall be used along with other Bond proceeds
for the Project; provided that after completion of such purpose, if any of such interest earnings remain
on hand, such interest earnings shall be deposited in the Interest and Sinking Fund. It is further
provided, however, that any interest earnings on Bond proceeds that are required to be rebated to the
United States of America pursuant to Section 9 hereof in order to prevent the Bonds from being
arbitrage bonds shall be so rebated and not considered as interest earnings for the purposes of this
Section.
Section 17. CONSTRUCTION FUND.
(a) The Issuer hereby creates and establishes and shall maintain on the books of the Issuer a
separate fund to be entitled the "Series 2013 General Obligation Bonds Construction Fund" for use
by the Issuer for payment of all lawful costs associated with the acquisition and construction of the
Project as hereinbefore provided. Upon payment of all such costs, any moneys remaining on deposit
in said fund shall be transferred to the Interest and Sinking fund. Amounts so deposited to the Interest
and Sinking Fund shall be used in the manner described in Section 5 of this Ordinance.
(b) The Issuer may invest proceeds of the Bonds (including investment earnings thereon)
issued for Improvement Projects and amounts deposited into the Interest and Sinking Fund in
investments authorized by the Public Funds Investment Act, Chapter 2256, Texas Government Code,
as amended; provided, however, that the Issuer hereby covenants that the proceeds of the sale of the
Bonds will be used as soon as practicable for the purposes for which the Bonds are issued.
(c) All deposits authorized or required by this Ordinance shall be secured to the fullest extent
required by law for the security of public funds.
Section 18. NET PREMIUM. The Bonds are being sold at a net premium equal to
$1,472,799.85. Premium in the amount of (i) $211,051.14 shall be allocated to pay the underwriting
discount for the Bonds, (ii) $186,748.71 to paycosts of issuance and (iii) $1,075,000 shall be allocated
to and applied against the voted authorization as set forth on Schedule I, and shall be deposited to the
Issuer's construction fund used for such purpose.
Section 19. APPROPRIATION. To pay the debt service coming due on the Bonds, if any,
prior to receipt of the taxes levied to pay such debt service, there is hereby appropriated from current
funds on hand, which are hereby certified to be on hand and available for such purpose, an amount
sufficient to pay such debt service, and such amount shall be used for no other purpose.
Section 20. SEVERABILITY. If any section, article, paragraph, sentence, clause, phrase or
word in this Ordinance, or application thereof to any persons or circumstances is held invalid or
unconstitutional by a court of competent jurisdiction, such holding shall not affect the validity of the
remaining portion of this Ordinance, despite such invalidity, which remaining portions shall remain in
full force and effect.
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Purpose
May 11, 2013 Election
SCHEDULEI
Voted Bonds
Amount
Amount
Amount Previously
Being
Authorized Issued
Issued
Unissued
Balance
Water and Sewer $45,000,000 -0- $35,000,000 0 $10,000,000
*Includes $1,075,000 premium paid for the Bonds and used to fund the construction account.
EXHIBIT A
Annual Financial Statements and Operating Data
The following information is referred to in Section 12(b) of this Ordinance:
The financial information and operating data with respect to the Issuer to be provided annually in
accordance with such Section are as specified (and included in the Appendix or under the headings of
the Official Statement referred to) below:
All quantitative financial information and operating data with respect to the Issuer of the general type
included in the Official Statement in Tables 1, 2, 11 - 13, 15 and 21 - 25 of Appendix "A" and in
Appendix "B ".
Accounting Principles
The accounting principles referred to in such Section are the accounting principles described in the
notes to the financial statements referred to in paragraph above.
A -1