HomeMy WebLinkAboutO-2021-3838 auth. issuance, $13.5 million, Certificates of Obligation, new city hallC)rd'ante Kb, 2bjq -�M
ORDINANCE AUTHORIZING ISSUANCE OF
CITY OF LA PORTE, TEXAS,
CERTIFICATES OF OBLIGATION, SERIES 2021
Adopted July 12, 2021
099900.24203 EMFUS 8568979N2
TABLE OF CONTENTS
Page
ARTICLE I FINDINGS AND DETERMINATIONS.................................................................... 1
Section LI: Findings and Determinations.............................................................................. 1
ARTICLE II DEFINITIONS AND INTERPRETATIONS
Section2.1: Definitions.......................................................................................................... 2
Section2.2: Interpretations..................................................................................................... 3
ARTICLE III TERMS OF THE CERTIFICA
Section 3.1:
Amount, Purpose and Authorization.................................................................. 3
Section 3.2:
Designation, Date and Interest Payment Dates .................................................. 3
Section 3.3:
Numbers, Denomination, Interest Rates and Maturities .................................... 4
Section 3.4:
Redemption Prior to Maturity............................................................................ 4
Section 3.5:
Manner of Payment, Characteristics, Execution and Authentication ................. 5
Section3.6:
Authentication.................................................................................................... 5
Section3.7:
Ownership.......................................................................................................... 6
Section 3.8:
Registration, Transfer and Exchange................................................................. 6
Section 3.9:
Book -Entry Only System................................................................................... 7
Section 3.10:
Replacement Certificates.................................................................................... 8
Section3.11:
Cancellation........................................................................................................ 9
ARTICLE IV FORM OF CERTIFICATES
10
Section 4.1:
Form of Certificates..........................................................................................
10
ARTICLE V SECURITY FOR THE CERTIFICATES...............................................................
10
Section 5.1:
Pledge and Levy of Taxes and Revenues.........................................................
10
Section5.2:
Debt Service Fund............................................................................................
10
Section5.3:
Further Proceedings..........................................................................................
10
ARTICLE VI CONCERNING THE PAYING AGENT/REGISTRAR
11
Section6.1:
Acceptance.......................................................................................................
I 1
Section6.2:
Trust Funds.........................................................................................I.............
11
Section 6.3:
Certificates Presented.......................................................................................
11
Section 6.4:
Unclaimed Funds Held by the Paying Agent/Registrar...................................
11
Section 6.5:
Paying Agent/Registrar May Own Certificates ................................................
12
Section 6.6:
Successor Paying Agents/Registrars................................................................
12
ARTICLE VII
PROVISIONS CONCERNING SALE AND APPLICATION OF PROCEEDS
OFCERTIFICATES.....................................................................................................................
12
Section 7.1:
Sale of Certificates...........................................................................................
12
Section 7.2:
Approval, Registration and Delivery ................................................................
12
Section 7.3:
Official Statement; Ratings..............................................................................
13
099900.24203 EMF_US 85689991v2
Section 7.4: Application of Proceeds of Certificates; Appropriation ................................... 13
Section 7.5: Covenants to Maintain Tax Exemption............................................................ 13
Section7.6: Related Matters................................................................................................. 16
ARTICLE VIII CONTINUING DISCLOSURE UNDERTAKING ............................................ 16
Section8.1:
Definitions ........................................................................................................
16
Section 8.2:
Annual Reports.................................................................................................
17
Section 8.3:
Material Event Notices.....................................................................................
17
Section 8.4:
Identifying Information....................................................................................
18
Section 8.5:
Limitations, Disclaimers and Amendments.....................................................
18
ARTICLE IX MISCELLANEOUS..............................................................................................
20
Section9.1:
Defeasance........................................................................................................
20
Section 9.2:
Ordinance a Contract - Amendments...............................................................
20
Section 9.3:
Legal Holidays.................................................................................................
21
Section 9.4:
Power to Revise Form of Documents...............................................................
21
Section 9.5:
No Recourse Against City Officials.................................................................
21
Section 9.6:
Further Proceedings..........................................................................................
21
Section 9.7:
Severability.......................................................................................................
21
Section9.8:
Open Meeting...................................................................................................
21
Section9.9:
Repealer............................................................................................................
22
Section 9.10:
Effective Date...................................................................................................
22
EXHIBIT A - FORM OF CERTIFICATE
ORDINANCE NO.2021-3838
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF LA PORTE, TEXAS,
CERTIFICATES OF OBLIGATION, SERIES 2021; AND CONTAINING OTHER
RELATED MATTERS
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LA PORTE, TEXAS
ARTICLE I
Section 1.1: Findings and DeterminationsThe City Council hereby officially finds
and determines that:
(a) The City of La Porte, Texas (the "City"), acting through its City Council, is
authorized pursuant to and in accordance with the provisions of Texas Local Government Code,
Chapter 271, Subchapter C, as amended (the "Act"), to issue certificates of obligation to provide
all or part of the funds to pay contractual obligations to be incurred for the construction of public
works and the purchase of materials, supplies, equipment, machinery, buildings, land and rights -
of -way for authorized needs and purposes and for the payment of contractual obligations for
professional services, to wit: (i) planning, acquisition, design, construction and equipment of a
new City Hall, (ii) renovation, improvement and equipment of existing City buildings, (iii)
construction, improvement, extension, upgrade and development of City streets, including
drainage, streetscaping, signalization and other traffic controls, sidewalks, street lights and the
acquisition of any right-of-way, (iv) drainage improvements, (v) construction, renovation,
improvement, and equipment of the City's water and sewer system, (vi) purchase of land for and
construction, renovation, improvement, and equipment of the City's Bay Forest Golf Course and
related facilities, and (vii) the cost of professional services rendered in connection the above listed
projects.
(b) The City Council authorized the publication of a notice of intention to issue its City
of La Porte, Texas, Certificates of Obligation, Series 2021 (the "Certificates") to the effect that the
City Council was tentatively scheduled to meet at 6:00 p.m. on July 12, 2021, at its regular meeting
place to adopt an ordinance authorizing the issuance of the Certificates to be payable from an ad
valorem tax levied, within the limits prescribed by law, on the taxable property located within the
City, and a limited pledge of surplus net revenues of the City's waterworks and sewer system (the
"System").
(c) Such notice was published and posted at the times and in the manner required by
the Act.
(d) No petition signed by at least five percent (5%) of the qualified voters of the City
has been filed with or presented to any official of the City protesting the issuance of such
Certificates on or before the date of passage of this Ordinance.
099900,24203 EMF_US 8%8979IQ
(e) No bond proposition to authorize the issuance of bonds for the same purposes as
the Certificates was submitted to the voters during the preceding three years and failed to be
approved.
(f) The City has determined that it is in the best interests of the City and that it is
otherwise desirable to issue the Certificates to provide all or part of the funds to pay contractual
obligations to be incurred for the purposes authorized by the Act.
ARTICLE II
Section 2.1: DefinitionsAs used herein, the following terns shall have the meanings
specified, unless the context clearly indicates otherwise:
"Act" means Texas Local Government Code, Chapter 271, Subchapter C, as amended.
"Attorney General" means the Attorney General of the State of Texas.
"Certificate" or "Certificates" means any or all of the City of La Porte, Texas, Certificates
of Obligation, Series 2021, authorized by this Ordinance.
"City" means the City of La Porte, Texas, and, where appropriate, its City Council.
"City Council" means the governing body of the City.
"Code" means the Internal Revenue Code of 1986, as amended.
"Comptroller" means the Comptroller of Public Accounts of the State of Texas.
"Debt Service Fund" means the fund by that name created pursuant to Section 5.2 hereof.
"Interest Payment Date," when used in connection with any Certificate, means March 15,
2022, and each September 15 and March 15 thereafter until maturity or earlier redemption of such
Certificate.
"Issuance Date" means the date on which the Certificates are delivered to and paid for by
the Underwriter.
"Ordinance" means this Ordinance and all amendments hereof and supplements hereto.
"Outstanding," when used with reference to the Certificates, means, as of a particular date,
all Certificates theretofore and thereupon delivered pursuant to this Ordinance except: (a) any
Certificates canceled by or on behalf of the City at or before such date; (b) any Certificates
defeased pursuant to the defeasance provisions of this Ordinance or otherwise defeased as
permitted by applicable law; and (c) any Certificates in lieu of or in substitution for which a
replacement Certificate shall have been delivered pursuant to this Ordinance.
"Paying Agent/Registrar" means Zions Bancorporation, National Association, Houston,
Texas, and its successors in that capacity.
"Purchase Contract" means the bond purchase agreement between the City and the
Underwriter regarding the issuance of the Certificates.
"Record Date" means the close of business on the last business day of the calendar month
immediately preceding the month in which the applicable Interest Payment Date occurs.
"Register" means the registration books for the Certificates kept by the Paying
Agent/Registrar in which are maintained the names and addresses of, and the principal amounts
registered to, each Registered Owner of Certificates.
"Registered Owner" means the person or entity in whose name any Certificate is registered
in the Register.
"Underwriter" shall mean the entity or entities specified in Section 7.1 hereof.
Section 2.2: InterpretationsAll terms defined herein and all pronouns used in this
Ordinance shall be deemed to apply equally to singular and plural and to all genders. The titles
and headings of the articles and sections of this Ordinance have been inserted for convenience of
reference only and are not to be considered a part hereof and shall not in any way modify or restrict
any of the terms or provisions hereof. This Ordinance and all the terms and provisions hereof shall
be liberally construed to effectuate the purposes set forth herein and to sustain the validity of the
Certificates and the validity of the levy of ad valorem taxes to pay the principal of and interest on
the Certificates.
ARTICLE III
TERMS OF THE CERTIFICATES
Section 3.1: Amount, Purpose and AuthorizationThe Certificates shall be issued in
fully registered form, without coupons, under and pursuant to the authority of the Act in the total
authorized aggregate principal amount of [THIRTEEN MILLION FIVE HUNDRED
THOUSAND DOLLARS ($13,500,000)] for the purpose of providing all or part of the funds to
pay contractual obligations to be incurred for the purposes described in paragraph 1.1(a) hereof,
and to pay the costs of issuing the Certificates.
Section 3.2: Designation, Date and Interest Payment DatesThe Certificates shall be
designated as the "City of La Porte, Texas, Certificates of Obligation, Series 2021," and shall be
dated July 1, 2021. The Certificates shall bear interest at the rates set forth in Section 3.3 below,
from the later of the Issuance Date, or the most recent Interest Payment Date to which interest has
been paid or duly provided for, calculated on the basis of a 360-day year of twelve 30-day months,
payable on March 15, 2022, and each September 15 and March 15 thereafter until maturity or
earlier redemption.
If interest on any Certificate is not paid on any Interest Payment Date and continues unpaid
for thirty (30) days thereafter, the Paying Agent/Registrar shall establish a new record date for the
payment of such interest, to be (mown as a Special Record Date. The Paying Agent/Registrar shall
establish a Special Record Date when funds to make such interest payment are received from or
on behalf of the City. Such Special Record Date shall be fifteen (15) days prior to the date fixed
for payment of such past due interest, and notice of the date of payment and the Special Record
Date shall be sent by United States mail, first class, postage prepaid, not later than five (5) days
prior to the Special Record Date, to each affected Registered Owner as of the close of business on
the day prior to mailing of such notice.
Section 3.3: Numbers, Denomination, Interest Rates and MaturitiesThe Certificates
shall be initially issued bearing the numbers, in the principal amounts and bearing interest at the
rates set forth in the following schedule, and may be transferred and exchanged as set out in this
Ordinance. The Certificates shall mature on March 15 in each of the years and in the amounts set
out in such schedule. Certificates delivered in transfer of or in exchange for other Certificates shall
be numbered in order of their authentication by the Paying Agent/Registrar, shall be in the
denomination of $5,000 or integral multiples thereof and shall mature on the same date and bear
interest at the same rate as the Certificate or Certificates in lieu of which they are delivered.
Year of
Principal
Interest
Maturity
Amount
Rate
2022
$235,000
L--%]
2023
$280,000
(%]
2024
$290,000
[_%]
2025
$300,000
[--%]
2026
$615,000
L%]
2027
$630,000
�°/a]
2028
$650,000
L—%]
2029
$670,000
L%]
2030
$690,000
[_%]
2031
$710,000
L_%]
2032
$735,000
L---%]
2033
$755,000
[%]
2034
$780,000
L-9%]
2035
$805,000
L-21-1
2036
$825,000
L--%]
2037
$850,000
L-21-1
2038
$880,000
L_%]
2039
$905,000
[%]
2040
$935,000
L--%]
2041
$960,000
L-1%1
Section 3.4: Redemption Prior to MaturityThe Certificates are subject to redemption
as provided in the FORM OF CERTIFICATES set forth in Article IV of and Exhibit A to this
Ordinance.
(b) Certificates may be redeemed in part only in integral multiples of $5,000. If a
Certificate subject to redemption is in a denomination larger than $5,000, a portion of such
Certificate may be redeemed, but only in integral multiples of $5,000. In selecting portions of
Certificates for redemption, each Certificate shall be treated as representing that number of
Certificates of $5,000 denomination which is obtained by dividing the principal amount of such
Certificate by $5,000. Upon presentation and surrender of any Certificate for redemption in part,
the Paying Agent/Registrar, in accordance with the provisions of this Ordinance, shall authenticate
and deliver in exchange therefor a Certificate or Certificates of like maturity and interest rate in an
aggregate principal amount equal to the unredeemed portion of the Certificate so surrendered.
(c) Notice of any redemption, identifying the Certificates or portions thereof to be
redeemed, shall be sent by United States mail, first class, postage prepaid, to the Registered
Owners thereof at their addresses as shown on the Register, not less than thirty (30) days before
the date fixed for such redemption. By the date fixed for redemption, due provision shall be made
with the Paying Agent/Registrar for the payment of the redemption price of the Certificates called
for redemption. If such notice of redemption is given, and if due provision for such payment is
made, all as provided above, the Certificates which are to be so redeemed thereby automatically
shall be redeemed prior to their scheduled maturities, they shall not bear interest after the date
fixed for redemption, and they shall not be regarded as being Outstanding except for the purpose
of being paid with the funds so provided for such payment.
Section 3.5: Manner of Payment, Characteristics, Execution and
AuthenticationThe Paying Agent/Registrar is hereby appointed the paying agent for the
Certificates. The Certificates shall be payable, shall have the characteristics and shall be executed,
sealed, registered and authenticated, all as provided and in the manner indicated in the FORM OF
CERTIFICATES set forth in Article IV of and Exhibit A to this Ordinance. If any officer of the
City whose manual or facsimile signature shall appear on the Certificates shall cease to be such
officer before the authentication of the Certificates or before the delivery of the Certificates, such
manual or facsimile signature shall nevertheless be valid and sufficient for all purposes as if such
officer had remained in such office.
The approving legal opinion of Houton Andrews Kurth LLP, Houston, Texas, Bond
Counsel, may be printed on the back of the Certificates over the certification of the City Secretary,
which may be executed in facsimile. CUSIP numbers also may be printed on the Certificates, but
errors or omissions in the printing of either the opinion or the numbers shall have no effect on the
validity of the Certificates.
Section 3.6: AuthenticationExcept for the Certificates to be initially issued, which
need not be authenticated by the Registrar, only such Certificates as shall bear thereon a certificate
of authentication, substantially in the form provided in Article IV of and Exhibit A to this
Ordinance, manually executed by an authorized representative of the Paying Agent/Registrar, shall
be entitled to the benefits of this Ordinance or shall be valid or obligatory for any purpose. Such
duly executed certificate of authentication shall be conclusive evidence that the Certificate so
authenticated was delivered by the Paying Agent/Registrar hereunder.
Section 3.7: OwnershipThe City, the Paying Agent/Registrar and any other person
may treat the person in whose name any Certificate is registered as the absolute owner of such
Certificate for the purpose of making and receiving payment of the principal thereof and interest
thereon and for all other purposes, whether or not such Certificate is overdue, and neither the City
nor the Paying Agent/Registmr shall be bound by any notice or knowledge to the contrary. All
payments made to the person deemed to be the Registered Owner of any Certificate in accordance
with this Section shall be valid and effective and shall discharge the liability of the City and the
Paying Agent/Registrar upon such Certificate to the extent of the sums paid.
Section 3.8: Registration, Transfer and ExchangeThe Paying Agent/Registrar is
hereby appointed the registrar for the Certificates. So long as any Certificate remains Outstanding,
the Paying Agent/Registrar shall keep the Register at its office in Houston, Texas, in which, subject
to such reasonable regulations as it may prescribe, the Paying Agent/Registrar shall provide for
the registration and transfer of the Certificates in accordance with the terms of this Ordinance.
Each Certificate shall be transferable only upon the presentation and surrender thereof at
the principal corporate trust office of the Paying Agent/Registrar, accompanied by an assignment
duly executed by the Registered Owner or his authorized representative in form satisfactory to the
Paying Agent/Registrar. Upon due presentation of any Certificate for transfer, the Paying
Agent/Registrar shall authenticate and deliver in exchange therefor, within seventy-two (72) hours
after such presentation, a new Certificate or Certificates, registered in the name of the transferee
or transferees, in authorized denominations and of the same maturity and aggregate principal
amount and bearing interest at the same rate as the Certificate or Certificates so presented and
surrendered.
All Certificates shall be exchangeable upon the presentation and surrender thereof at the
principal corporate trust office of the Paying Agent/Registrar for a Certificate or Certificates of the
same maturity and interest rate and in any authorized denomination, in an aggregate principal
amount equal to the unpaid principal amount of the Certificate or Certificates presented for
exchange. The Paying Agent/Registrar shall be and is hereby authorized to authenticate and
deliver exchange Certificates in accordance with the provisions of this Section. Each Certificate
delivered by the Paying Agent/Registrar in accordance with this Section shall be entitled to the
benefits and security of this Ordinance to the same extent as the Certificate or Certificates in lieu
of which such Certificate is delivered.
All Certificates issued in transfer or exchange shall be delivered to the Registered Owners
thereof at the principal corporate trust office of the Paying Agent/Registrar or sent by United States
mail, first class, postage prepaid.
The City or the Paying Agent/Registrar may require the Registered Owner of any
Certificate to pay a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with the transfer or exchange of such Certificate. Any fee or charge of the
Paying Agent/Registrar for such transfer or exchange shalt be paid by the City.
The Paying Agent/Registrar shall not be required to transfer or exchange any Certificate
called for redemption in whole or in part during the forty-five (45) day period immediately prior
to the date fixed for redemption; provided, however, that this restriction shall not apply to the
transfer or exchange by the Registered Owner of the unredeemed portion of a Certificate called
for redemption in part.
Section 3.9: Book -Entry Only System(a) The definitive Certificates shall be
initially issued in the form of a separate single fully registered Certificate for each of the maturities
thereof. Upon initial issuance, the ownership of each such Certificate shall be registered in the
name of Cede & Co., as nominee of DTC, and except as provided in subsection (b) hereof, all of
the Outstanding Certificates shall be registered in the name of Cede & Co., as nominee of DTC.
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 word "Cede & Co." in this Ordinance shall refer to such new
nominee of DTC.
With respect to Certificates registered in the name of Cede & Co., as nominee of DTC, the
City and the Paying Agent/Registrar shall have no responsibility or obligation to any DTC
Participant or to any person on behalf of whom such a DTC Participant holds an interest in the
Certificates. Without limiting the immediately preceding sentence, the City and the Paying
Agent/Registrar shall have no responsibility or obligation with respect to (a) the accuracy of the
records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in the
Certificates, (b) the delivery to any DTC Participant or any other person, other than a holder of the
Certificate, as shown on the Register, of any notice with respect to the Certificates, including any
notice of redemption or (c) the payment to any DTC Participant or any other person, other than a
holder of the Certificate, as shown in the Register of any amount with respect to principal of
Certificates, premium, if any, or interest on the Certificates.
Except as provided in subsection (c) of this Section 3.9, the City and the Paying
Agent/Registrar shall be entitled to treat and consider the person in whose name each Certificate
is registered in the Register as the absolute owner of such Certificate for the purpose of payment
of principal of, premium, if any, and interest on Certificates, for the purpose of giving notices of
redemption and other matters with respect to such Certificate, for the purpose of registering
transfer with respect to such Certificate, and for all other purposes whatsoever. The Paying
Agent/Registrar shall pay all principal of Certificates, premium, if any, and interest on the
Certificates only to or upon the order ofthe respective owners, as shown in the Register 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 City's obligations with respect to
payment of principal of, premium, if any, and interest on the Certificates to the extent of the sum
or sums so paid. No person other than an owner shall receive a Certificate evidencing the
obligation of the City to make payments of amounts due pursuant to this Ordinance.
(b) Payments and Notices to Cede & Co. Notwithstanding any other provision of this
Ordinance to the contrary, as long as any Certificates are registered in the name of Cede & Co., as
nominee of DTC, all payments with respect to principal of, premium, if any, and interest on the
Certificates, and all notices with respect to such Certificates shall be made and given, respectively,
in the manner provided in the representation letter of the City to DTC.
(c) Successor Securities Depository; Transfer Outside Book -Entry Only System. In
the event that the City or the Paying Agent/Registrar determines that DTC is incapable of
discharging its responsibilities described herein and in the representation letter of the City to DTC,
and that it is in the best interest of the beneficial owners of the Certificates that they be able to
obtain certified Certificates, the City or the Paying Agent/Registrar shall (a) appoint a successor
securities depository, qualified to act as such under Section 17(a) of the Securities and Exchange
Act of 1934, as amended, notify DTC of the appointment of such successor securities depository
and transfer one or more separate Certificates to such successor securities depository or (b) notify
DTC of the availability through DTC of Certificates and transfer one or more separate Certificates
to DTC Participants having Certificates credited to their DTC accounts. In such event, the
Certificates shall no longer be restricted to being registered in the Register 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 holders of the Certificates transferring or exchanging
Certificates shall designate, in accordance with the provisions of this Ordinance.
Section 3.10: Replacement Cer ificatesUpon the presentation and surrender to the
Paying Agent/Registrar of a damaged or mutilated Certificate, the Paying Agent/Registrar shall
authenticate and deliver in exchange therefor a replacement Certificate, of the same maturity,
interest rate and principal amount, bearing a number not contemporaneously outstanding. The
City or the Paying Agent/Registrar may require the Registered Owner of such Certificate to pay a
sum sufficient to cover any tax or other governmental charge that may be imposed in connection
therewith and any other expenses connected therewith, including the fees and expenses of the
Paying Agent/Registrar and the City.
If any Certificate is lost, apparently destroyed or wrongfully taken, the City, pursuant to
the applicable laws of the State of Texas and ordinances of the City, and in the absence of notice
or knowledge that such Certificate has been acquired by a bona fide Underwriter, shall execute,
and the Paying Agent/Registrar shall authenticate and deliver, a replacement Certificate of the
same maturity, interest rate and principal amount, bearing a number not contemporaneously
outstanding, provided that the Registered Owner thereof shall have:
(a) famished to the City and the Paying Agent/Registrar satisfactory evidence of the
ownership of and the circumstances of the loss, destruction or theft of such Certificate;
(b) famished such security or indemnity as may be required by the Paying
Agent/Registrar and the City to save and hold them harmless;
(c) paid all expenses and charges in connection therewith, including, but not limited
to, printing costs, legal fees, fees of the Paying Agent/Registrar and any tax or other governmental
charge that may be imposed; and
(d) met any other reasonable requirements of the City and the Paying Agent/Registrar.
If, after the delivery of such replacement Certificate, a bona fide Underwriter of the original
Certificate in lieu of which such replacement Certificate was issued presents for payment such
original Certificate, the City and the Paying Agent/Registrar shall be entitled to recover such
replacement Certificate from the person to whom it was delivered or any person taking therefrom,
except a bona fide Underwriter, and shall be entitled to recover upon the security or indemnity
provided therefor to the extent of any loss, damage, cost or expense incurred by the City or the
Paying Agent/Registrar in connection therewith.
If any such mutilated, lost, apparently destroyed or wrongfully taken Certificate has
become or is about to become due and payable, the City in its discretion may, instead of issuing a
replacement Certificate, authorize the Paying Agent/Registrar to pay such Certificate.
Each replacement Certificate delivered in accordance with this Section shall be entitled to
the benefits and security of this Ordinance to the same extent as the Certificate or Certificates in
lieu of which such replacement Certificate is delivered.
Section 3.11: CancellationAll Certificates paid or redeemed in accordance with this
Ordinance, and all Certificates in lieu of which exchange Certificates or replacement Certificates
are authenticated and delivered in accordance herewith, shall be canceled and destroyed upon the
making of proper records regarding such payment or redemption. The Paying Agent/Registrar
shall periodically famish the City with certificates of destruction of such Certificates.
[Remainder ofpage intentionally left blank]
ARTICLE IV
FORM OF CERTIFICATES
Section 4.1: Form of CertificatesThe Certificates, including the Form of
Comptroller's Registration Certificate, Form of Paying Agent/Registrar Authentication
Certificate, Form of Assignment and Form of Statement of Insurance, if any, shall be in
substantially the form set forth in Exhibit A hereto, with such omissions, insertions and variations
as may be necessary or desirable, and not prohibited by this Ordinance.
ARTICLE V
SECURITY FOR THE CERTIFICATES
Section 5.1: Pledge and Levy of Taxes and Revenues(a) To provide for the
payment of principal of and interest on the Certificates, there is hereby levied, within the limits
prescribed by law, for the current year and each succeeding year thereafter, while the Certificates
or any part of the principal thereof and the interest thereon remain outstanding and unpaid, an ad
valorem tax upon all taxable property within the City sufficient to pay the interest on the
Certificates and to create and provide a sinking fund of not less than 2% of the principal amount
of the Certificates or not less than the principal payable out of such tax, whichever is greater, with
full allowance being made for tax delinquencies and the costs of tax collection, and such taxes,
when collected, shall be applied to the payment of principal of and interest on the Certificates by
deposit to the Debt Service Fund (as hereinafter defined) and to no other purpose.
(b) In addition, pursuant to the authority of Chapter 1502, Texas Government Code,
the City also hereby pledges the revenues to be derived from the City's waterworks and sewer
system, after the payment of all operation and maintenance expenses thereof (the "Net
Revenues"), in an amount not to exceed $1,000, to the payment of the principal of and interest on
the Certificates, provided that the pledge of Net Revenues is and shall be junior and subordinate
in all respects to the pledge of Net Revenues to the payment of any obligation of the City, whether
authorized heretofore or hereafter, which the City designates as having a pledge senior to the
pledge of the Net Revenues to the payment of the Certificates. The City also reserves the right to
issue, for any lawful purpose at any time, in one or more installments, bonds, certificates of
obligation and other obligations of any kind, secured in whole or in part by a pledge of Net
Revenues, that may be prior and superior in right to, on a parity with, or junior and subordinate
to the pledge of Net Revenues securing the Certificates.
Section 5.2: Debt Service FundThe "Certificates of Obligation, Series 2021, Debt
Service Fond" (the "Debt Service Fund') is hereby created, and the proceeds from all taxes levied,
assessed and collected for and on account of the Certificates authorized by this Ordinance shall be
deposited, as collected, in such Fund. Such amount, plus any other amounts deposited by the City
into such Fund and any and all investment earnings on amounts on deposit in such Fund, shall be
used only to pay the principal of, premium, if any, and interest on the Certificates.
Section 5.3: Further ProceedingsAfter the Certificates to be initially issued have been
executed, it shall be the duty of the Mayor and other appropriate officials and agents of the City to
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deliver the Certificates to be initially issued and all pertinent records and proceedings to the
Attorney General for examination and approval. After the Certificates to be initially issued shall
have been approved by the Attorney General, they shall be delivered to the Comptroller for
registration. Upon registration of the Certificates to be initially issued, the Comptroller (or a
deputy lawfully designated in writing to act for the Comptroller) shall manually sign the
Comptroller's registration certificate prescribed herein to be affixed or attached to the Certificates
to be initially issued, and the seal of said Comptroller shall be impressed, or placed in facsimile,
thereon.
ARTICLE VI
CONCERNING THE PAYING AGENT/REGISTRAR
Section 6.1: AcceptanceZions Bancorporation, National Association, Houston, Texas
is hereby appointed as the initial Paying Agent/Registrar for the Certificates pursuant to the terms
and provisions of the Paying Agent/Registrar Agreement by and between the City and the Paying
AgemlRegistrar in substantially the form presented at the meeting at which this Ordinance was
approved. The Mayor is hereby authorized to execute and deliver such Paying Agent/Registrar
Agreement on behalf of the City in multiple counterparts and the City Secretary is hereby
authorized to attest thereto and affix the City's seal. Such initial Paying Agent/Registrar and any
successor Paying Agent/Registrar, by undertaking the performance of the duties of the Paying
Agent/Registrar hereunder, and in consideration of the payment of any fees pursuant to the terms
of any contract between the Paying Agent/Registrar and the City and/or the deposits of money
pursuant to this Ordinance, shall be deemed to accept and agree to abide by the terms of this
Ordinance.
Section 6.2: Trust FundsAll money transferred to the Paying Agent/Registrar in its
capacity as Paying Agent/Registrar for the Certificates under this Ordinance (except any sums
representing Paying Agent/Registrar's fees) shall be held in trust for the benefit of the City, shall
be the property of the City and shall be disbursed in accordance with this Ordinance.
Section 63: Certificates PresentedSubject to the provisions of Section 6.4, all matured
Certificates presented to the Paying Agent/Registrar for payment shall be paid without the
necessity of further instructions from the City. Such Certificates shall be canceled as provided
herein.
Section 6.4: Unclaimed Funds Held by the Paying Agent/RegistrarFunds held by
the Paying Agent/Registrar that represent principal of and interest on the Certificates remaining
unclaimed by the Registered Owner thereof after the expiration of three years from the date such
funds have become due and payable (a) shall be reported and disposed of by the Paying
Agent/Registrar in accordance with the provisions of Title 6 of the Texas Property Code, as
amended, to the extent such provisions are applicable to such fonds, or (b) to the extent such
provisions do not apply to the funds, such funds shall be paid by the Paying Agent/Registrar to the
City upon receipt by the Paying Agem/Registrar of a written request therefor from the City.
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The Paying Agent/Registrar shall have no liability to the Registered Owners of the
Certificates by virtue of actions taken in compliance with this Section.
Section 6.5: Paying Agent/Registrar May Own CertificatesThe Paying
Agent/Registrar in its individual or any other capacity, may become the owner or pledgee of
Certificates with the same rights it would have if it were not the Paying AgentlRegistrar.
Section 6.6: Successor Paying Agents/RegistrarsThe City covenants that at all times
while any Certificates are Outstanding it will provide a legally qualified bank, trust company,
financial institution or other agency to act as Paying Agent/Registrar for the Certificates. The City
reserves the right to change the Paying Agent/Registrar for the Certificates on not less than sixty
(60) days' written notice to the Paying Agent/Registrar, as long as any such notice is effective not
less than 60 days prior to the next succeeding principal or interest payment date on the Certificates.
Promptly upon the appointment of any successor Paying Agent/Registrar, the previous Paying
Agent/Registrar shall deliver the Register or a copy thereof to the new Paying Agent/Registrar,
and the new Paying Agent/Registrar shall notify each Registered Owner, by United States mail,
first class, postage prepaid, of such change and of the address of the new Paying Agent/Registrar.
Each Paying Agent/Registrar hereunder, by acting in that capacity, shall be deemed to have agreed
to the provisions of this Ordinance.
ARTICLE VII
PROVISIONS CONCERNING SALE AND
APPLICATION OF PROCEEDS OF CERTIFICATES
Section 7.1: Sale of CertificatesThe sale of the Certificates to J.P. Morgan Securities
LLC (the "Underwriter") at a price of $ (representing the par amount of the
Certificates plus a net premium of $L—.�and and underwriter's discount of $[.)
in accordance with the terms of the Purchase Contract of even date herewith, which price and terms
are hereby found and determined to be the most advantageous reasonably obtainable by and are in
the best interest of the City. The Mayor, City Manager or Director of Finance is hereby authorized
and directed to executed the Purchase Contract on behalf of the City, and the Mayor, City
Secretary, City Manager, Director of Finance and other appropriate officials of the City are hereby
authorized to do any and all things necessary or desirable to satisfy the conditions set out therein
and to provide for the issuance and delivery of the Certificates.
Section 7.2: Approval, Registration and DeliveryThe Mayor is hereby authorized to
have control and custody of the Certificates and all necessary records and proceedings pertaining
thereto pending their delivery, and the Mayor and other officers and employees of the City are
hereby authorized and directed to make such certifications and to execute such instruments as may
be necessary to accomplish the delivery of the Certificates and to assure the investigation,
examination and approval thereof by the Attorney General and the registration of the initial
Certificates by the Comptroller. Upon registration of the Certificates, the Comptroller (or the
Comptroller's certificates clerk or an assistant certificates clerk lawfully designated in writing to
act for the Comptroller) shall manually sign the Comptroller's Registration Certificates prescribed
herein to be attached or affixed to each Certificates initially delivered and the seal of the
Comptroller shall be impressed or printed or lithographed thereon.
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Section 73: Official Statement; RatingsThe City Council hereby approves the form
and content and distribution of the Preliminary Official Statement prepared in the initial offering
and sale of the Certificates and hereby authorizes the preparation of a final Official Statement
reflecting the final pricing terms of the Certificates and other relevant information. The use of
such final Official Statement by the Underwriter is hereby approved and authorized and the proper
officials of the City are authorized to sign such Official Statement.
Further, the City Council hereby ratifies, authorizes and approves the actions of the Mayor,
the City Manager, the Director of Finance, the City's financial advisor and other consultants in
seeking a rating on the Certificates from S&P Global Ratings.
Section 7.4: Application of Proceeds of CertiftcatesProceeds from the sale of the
Certificates shall, promptly upon receipt by the City, be applied as follows:
(1) Accrued interest, if any, shall be deposited into the Debt Service Fund;
(2) Net premium in the amount of $[ _] shall be applied to pay
underwriter's discount and in the amount of $[ _] shall be applied to pay costs of
issuance arising in connection with the issuance of the Certificates;
(3) The remaining proceeds shall be applied, together with other funds of the
City, to provide funds to pay contractual obligations to be incurred for the purposes set
forth in Section 3.1 of this Ordinance.
Section 7.5: Covenants to Maintain Tax ExemptionDefinitions. When used in this
Section, the following terms have the following meanings:
"Code" means the Internal Revenue Code of 1986, as amended by all legislation, if any,
enacted on or before the Issue Date.
"Computation Date" has the meaning stated in section 1.148 1(b) of the Regulations.
"Gross Proceeds" has the meaning stated in section 1.148 1(b) of the Regulations.
"Investment" has the meaning stated in section 1.148 1(b) of the Regulations.
"Issue Date" for the Certificates or other obligations of the City is the respective date on
which such Certificates or other obligations of the City, is delivered against payment therefor.
"Net Sale Proceeds" has the meaning stated in section 1.148 1(b) of the Regulations.
"Nonpurpose Investment" has the meaning stated in section 1.148 1(b) of the Regulations.
"Proceeds" has the meaning stated in section 1.148-1(b) of the Regulations.
"Rebate Amount" has the meaning stated in section 1.148-3 of the Regulations.
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"Regulations" means the temporary or final Income Tax Regulations applicable to the
Certificates issued pursuant to sections 141 through 150 of the Code. Any reference to a section
of the Regulations shall also refer to any successor provision to such section hereafter promulgated
by the Internal Revenue Service pursuant to sections 141 through 150 of the Code and applicable
to the Certificates.
"Yield of
(1) any Investment shall be computed in accordance with section 1.148-5 of the
Regulations, and
(2) the Certificates shall be computed in accordance with section 1.148-4 of the
Regulations.
(b) Not to Cause Interest to Become Taxable. The City shall not use, permit the use of
or omit to use Gross Proceeds or any other amounts (or any property the acquisition, construction
or improvement of which is to be financed directly or indirectly with Gross Proceeds) in a manner
which, if made or omitted, respectively, would cause the interest on any Certificates to become
includable in the gross income, as defined in section 61 of the Code, of the owner for federal
income tax purposes. Unless and until the City has received a written opinion of counsel nationally
recognized in the field of municipal bond law to the effect that failure to comply with such
covenant will not adversely affect the exemption from federal income tax of the interest on any
Certificate, the City shall comply with the specific covenants in this Section.
(c) No Private Use or Private Payments. Except as permitted by section 141 of the
Code and the regulations and rulings relating to section 141 of the Code, the City shall, at all times
prior to the last stated maturity of the Certificates,
(1) exclusively own, operate, and possess all property the acquisition, construction, or
improvement of which is to be financed directly or indirectly with Gross Proceeds of the
Certificates and not use or permit the use of such Gross Proceeds or any property acquired,
constructed, or improved with such Gross Proceeds in any activity carried on by any person or
entity other than a state or local government, unless such use is solely as a member of the general
public, or
(2) not directly or indirectly impose or accept any charge or other payment for use of
Gross Proceeds of the Certificates or any property the acquisition, construction or improvement of
which is to be financed directly or indirectly with such Gross Proceeds other than taxes of general
application and interest earned on investments acquired with such Gross Proceeds pending
application for their intended purposes.
(d) No Private Loan. Except to the extent permitted by section 141 of the Code and
the regulations and rulings relating to section 141 of the Code, the City shall not use Gross
Proceeds of the Certificates to make or finance loans to any person or entity other than a state or
local government. For purposes of the foregoing covenant, Gross Proceeds are considered to be
"loaned" to a person or entity if (1) property acquired, constructed or improved with Gross
Proceeds is sold or leased to such person or entity in a transaction which creates a debt for federal
income tax purposes, (2) capacity in or service from such property is committed to such person or
14
entity under a take or pay, output, or similar contract or arrangement, or (3) indirect benefits, or
burdens and benefits of ownership, of such Gross Proceeds or such property are otherwise
transferred in a transaction which is the economic equivalent of a loan.
(e) Not to Invest at Higher Yield. Except to the extent permitted by section 148 of the
Code and the regulations and rulings relating to section 148 of the Code, the City shall not, at any
time prior to the earlier of the final stated maturity or final payment of the Certificates, directly or
indirectly invest Gross Proceeds of such Certificates in any Investment (or use such Gross
Proceeds to replace money so invested), if as a result of such investment the Yield of all
Investments allocated to such Gross Proceeds whether then held or previously disposed of, exceeds
the Yield on the Certificates.
(f) Not Federally Guaranteed. Except to the extent permitted by section 149(b) of the
Code and the regulations and rulings relating to section 149(b) of the Code, the City shall not take
or omit to take any action which would cause the Certificates to be federally guaranteed within the
meaning of section 149(b) of the Code and the regulations and rulings relating to section 149(b)
of the Code.
(g) Information Report. The City shall timely file with the Secretary of the Treasury
the information required by section 149(e) of the Code with respect to the Certificates on such
forms and in such place as such Secretary may prescribe.
(h) Payment of Rebate Amount. Except to the extent otherwise provided in section
148(f) of the Code and the regulations and rulings relating to section 148(f) of the Code, the City
shall:
(1) account for all Gross Proceeds (including all receipts, expenditures and investments
thereof) on its books of account separately and apart from all other funds (and receipts,
expenditures and investments thereof) and shall retain all records of such accounting for at least
six years after the final Computation Date. The City may, however, to the extent permitted by
law, commingle Gross Proceeds of the Certificates with other money of the City, provided that the
City separately accounts for each receipt and expenditure of such Gross Proceeds and the
Certificates acquired with these proceeds.
(2) calculate the Rebate Amount with respect to the Certificates, not less frequently
than each Computation Date, in accordance with rules set forth in section 148(f) of the Code,
section 1.148 3 of the Regulations, and the rulings thereunder. The City shall maintain a copy of
such calculations for at least six years after the final Computation Date.
(3) as additional consideration for the purchase of the Certificates by the initial
Underwriter and the loan of the money represented by this purchase, and in order to induce such
purchase by measures designed to ensure the excludability of the interest from the gross income
of the owners for federal income tax purposes, pay to the United States the amount described in
paragraph (2) above at the times, in the installments, to the place, in the manner and accompanied
by such forms or other information as is or may be required by section 148(f) of the Code and the
regulations and rulings relating to section 148(f) of the Code, and
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(4) exercise reasonable diligence to assure that no errors are made in the calculations
required by paragraph (2) and, if such error is made, to discover and promptly to correct such error
within a reasonable amount of time, including payment to the United States of any interest and any
penalty required by the Regulations.
(i) Not to Divert Arbitrage Profits. Except to the extent permitted by section 148 of
the Code and the regulations and rulings relating to section 148 of the Code, the City shall not, at
any time prior to the earlier of the final stated maturity or final payment of the Certificates, enter
into any transaction that reduces the amount required to be paid to the United States pursuant to
Subsection (h) of this Section because such transaction results in a smaller profit or a larger loss
than would have resulted if the transaction had been at arm's length and had the Yield of the
Certificates not been relevant to either party.
0) Not Hedge Bonds. The City will not invest more than 50 percent of the Proceeds
of the Certificates in Nonpurpose Investments having a guaranteed yield for four years or more.
On the Closing Date, the City will reasonably expect that at least 85 percent of the Net Sale
Proceeds of the Certificates will be used to carry out the governmental purpose of such series
within three years after the Closing Date.
Section 7.6: Related MattenIn order that the City shall satisfy in a timely manner all
of its obligations under this Ordinance, the Mayor, the Mayor Pro-Tem, City Secretary and all
other appropriate officers, agents, representatives and employees of the City are hereby authorized
and directed to take all other actions that are reasonably necessary to provide for the issuance and
delivery of the Certificates, including, without limitation, executing and delivering on behalf of
the City all certificates, consents, receipts, requests, notices, and other documents as may be
reasonably necessary to satisfy the City's obligations under this Ordinance and to direct the
transfer and application of funds of the City consistent with the provisions of this Ordinance.
ARTICLE VIII
Section 8.1: Definitions As used in this Article, the following terms have the meanings
ascribed to such terms below:
"Financial Obligation" means a (a) debt obligation; (b) derivative instrument entered into
in connection with, or pledged as security or a source of payment for, an existing or planned debt
obligation; or (c) guarantee of a debt obligation or any such derivative instrument provided that
"financial obligation" shall not include municipal securities (as defined in the Securities Exchange
Act of 1934, as amended) as to which a final Official Statement (as defined in the Rule) has been
provided to the MSRB consistent with the Rule.
"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.
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Section 8.2: Annual ReportsThe City shall provide annually to the MSRB, (1) within
six months after the end of each fiscal year of the City, financial information and operating data
with respect to the City of the general type included in the final Official Statement, being the
information described in Appendix A (Table 1 and Tables 3-11) of the Official Statement and (2)
if not provided as part of such financial information and operating data, audited financial
statements of the City, when and if available. Any financial statements to be provided shall be (i)
prepared in accordance with the accounting principles described in Appendix C of the Official
Statement or such other accounting principles as the City may be required to employ, from time to
time, by State law or regulation, and (ii) audited, if the City commissions an audit of such
statements and the audit is completed within the period during which they must be provided. If the
audit of such financial statements is not complete within 12 months after any such fiscal year end,
then the City shall file unaudited financial statements within such 12-month period and audited
financial statements for the applicable fiscal year, when and if the audit report on such statements
becomes available.
The City may provide updated information in full text or may incorporate by reference
certain other publicly available documents, as permitted by the Rule.
The City's current fiscal year end is September 30. Accordingly, it must provide updated
the required information in Appendix A by the last day of March in each year and the required
information in Appendix C by the last day of September in each year unless the City changes its
fiscal year. If the City changes its fiscal year, it will notify the MSRB of the change.
Section 8.3: Material Event Notices.
The City shall notify the MSRB, in a timely manner, of any of the following events with
respect to the Certificates (not in excess of ten (10) business days after the occurrence of the event):
(a) Principal and interest payment delinquencies;
(b) Non-payment related defaults, if material;
(c) Unscheduled draws on debt service reserves reflecting financial difficulties;
(d) Unscheduled draws on credit enhancements reflecting financial difficulties;
(e) Substitution of credit or liquidity providers, or their failure to perform;
(f) Adverse tax opinions or events affecting the tax-exempt status of the Certificates;
(g) Modifications to rights of holders of the Certificates;
(h) Certificate calls;
(i) Defeasances;
0) Release, substitution, or sale of property securing repayment of the Certificates;
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(k) Rating changes'
(1) bankruptcy, insolvency, receivership, or similar event of the City;
(m) consummation of a merger, consolidation, or acquisition involving the City or the
sale of all or substantially all of the assets of the City, other than in the ordinary course of business,
the entry into a definitive agreement to undertake such action, or the termination of a definitive
agreement relating to any such actions, other than pursuant to its terms, if material;
(n) the appointment of a successor or additional trustee or change of name of the
trustee, if material;
(o) incurrence of a "Financial Obligation" of the City (as defined by the Rule, which
includes certain debt, debt -like, and debt -related obligations), if material, or agreement to
covenants, events of default, remedies, priority rights, or other similar terms of any such
Financial Obligation of the City, any of which affect security holders, if material; and
(p) default, event of acceleration, termination event, modification of terms, or other
similar events under the terms of any such Financial Obligation of the City, any of which reflect
financial difficulties.
For these purposes, any event described in the immediately preceding paragraph (1) is
considered to occur when any of the following occur: the appointment of a receiver, fiscal agent,
or similar officer for the City in a proceeding under the United States Bankruptcy Code or in any
other proceeding under state or federal law in which a court or governmental authority has assumed
jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has
been assumed by leaving the existing governing body and officials or officers 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
City.
The City shall notify the MSRB, in a timely manner, of any failure by the City to provide
financial information or operating data in accordance with Section 8.1 of this Ordinance by the
time required by such Section.
Section 8.4: Identifying Information. All documents shall be provided to the MSRB
in an electronic format and accompanied by identifying information, as prescribed by the MSRB.
Section 8.5: Limitations, Disclaimers and AmendmentsThe City shall be obligated
to observe and perform the covenants specified in this Article for so long as, but only for so long
m, the City remains an "obligated person" with respect to the Certificates within the meaning of
the Rule, except that the City in any event will give the notice required by Section 8.2 of any
Certificate calls and defeasance that cause the City to be no longer such an `obligated person."
The provisions of this Article are for the sole benefit of the holders and beneficial owners
of the Certificates, and nothing in this Article, express or implied, shall give any benefit or any
18
legal or equitable right, remedy, or claim hereunder to any other person. The City undertakes to
provide only the financial information, operating data, financial statements, and notices which it
has expressly agreed to provide pursuant to this Article and does not hereby undertake to provide
any other information that may be relevant or material to a complete presentation of the City's
financial results, condition, or prospects or hereby undertake to update any information provided
in accordance with this Article or otherwise, except as expressly provided herein. The City does
not make any representation or warranty concerning such information or its usefulness to a
decision to invest in or sell Certificates at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER
OR BENEFICIAL OWNER OF ANY CERTIFICATE OR ANY OTHER PERSON, IN
CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM
ANY BREACH BY THE CITY, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS
PART, OF ANY COVENANT SPECIFIED IN THIS ARTICLE, 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.
No default by the City in observing or performing its obligations under this Article shall
constitute a breach of or default under the Ordinance for purposes of any other provision of this
Ordinance.
Nothing in this Article is intended or shall act to disclaim, waive, or otherwise limit the
duties of the City under federal and state securities laws.
The provisions of this Article may be amended by the City from time to time to adapt the
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 City, but only if (1) the provisions of this
Article, as so amended, would have permitted an underwriter to purchase or sell the Certificates in
the primary offering of the Certificates in compliance with the Rule, taking into account any
amendments or interpretations of the Rule to the date of such amendment, as well as such changed
circumstances, and (2) either (a) the holders 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 Certificates consent to such amendment or (b) a person that is
unaffiliated with the City (such as nationally recognized bond counsel) determines that such
amendment will not materially impair the interests of the holder and beneficial owners of the
Certificates. If the City so amends the provisions of this Article, it shall include with any amended
financial information or operating data next provided in accordance with Section 8.1 an
explanation, in narrative form, of the reasons for the amendment and of the impact of any change
in the type of financial information or operating data so provided. The City may also amend or
repeal the provisions of this Article if the SEC amends or repeals the applicable provisions of the
Rule or a court of final jurisdiction enters judgment that such provisions of the Rule are invalid,
and the City also may amend the provisions of this Article in its discretion in any other manner or
circumstance, but in either case only if and to the extent that the provisions of this sentence would
not have prevented an underwriter from lawfully purchasing or selling Certificates in the primary
offering of the Certificates, giving effect to (a) such provisions as so amended and (b) any
amendments or interpretations of the Rule.
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ARTICLE IX
MISCELLANEOUS
Section 9.1: DefeasanceThe City may defease the provisions of this Ordinance and
discharge its obligations to the Registered Owners of any or all of the Certificates to pay the
principal of and interest thereon in any manner now or hereafter permitted by law, including by
depositing with the Paying Agent/Registrar, a trust company or commercial bank other than the
Paying Agent/Registrar, or with the Comptroller of Public Accounts of the State of Texas either:
(a) cash in an amount equal to the principal amount of such Certificates and premium,
if any, and interest thereon to the date of maturity or redemption; or
(b) pursuant to an escrow or trust agreement, cash and/or (i) direct noncallable
obligations of United States of America, including obligations that are unconditionally guaranteed
by the United States of America; (ii) noncallable obligations of an agency or instrumentality of the
United States, including obligations that are unconditionally guaranteed or insured by the agency
or instrumentality and that are rated as to investment quality by a nationally recognized investment
rating firm not less than "AAA" or its equivalent; or (iii) noncallable obligations of a state or an
agency or a county, municipality, or other political subdivision of a state that have been refunded
and that are rated as to investment quality by a nationally recognized investment rating firm not
less than "AAA" or its equivalent, which, in the case of (i), (ii) or (iii), may be in book -entry form,
and the principal of and interest on which will, when due or redeemable at the option of the holder,
without further investment or reinvestment of either the principal amount thereof or the interest
earnings thereon, provide money in an amount which, together with other moneys, if any, held in
such escrow at the same time and available for such purpose, shall be sufficient to provide for the
timely payment of the principal of and interest thereon to the date of maturity or earlier redemption;
provided, however, that if any of the Certificates are to be redeemed prior to their respective dates
of maturity, provision shall have been made for giving notice of redemption as provided in this
Ordinance. Upon such deposit, such Certificates shall no longer be regarded to be Outstanding or
unpaid. Any surplus amounts not required to accomplish such defeasance shall be returned to the
City.
Section 9.2: Ordinance a Contract - AmendmentsThis Ordinance shall constitute a
contract with the Registered Owners from time to time, be binding on the City, and shall not be
amended or repealed by the City so long as any Certificate remains Outstanding except as
permitted in this Section. The City may, without the consent of or notice to any Registered
Owners, from time to time and at any time, amend this Ordinance in any manner not detrimental
to the interests of the Registered Owners, including the curing of any ambiguity, inconsistency, or
formal defect or omission herein. In addition, the City may, with the consent of Registered Owners
who own in the aggregate 51% of the principal amount of the Certificates then Outstanding,
amend, add to, or rescind any of the provisions of this Ordinance; provided that, without the
consent of all Registered Owners of Outstanding Certificates, no such amendment, addition, or
rescission shall (i) extend the time or times of payment of the principal of and interest on the
Certificates, reduce the principal amount thereof, the redemption price, or the rate of interest
thereon, or in any other way modify the terms of payment of the principal of or interest on the
20
Certificates, (ii) give any preference to any Certificate over any other Certificate, or (iii) reduce
the aggregate principal amount of Certificates required to be held by Registered Owners for
consent to any such amendment, addition, or rescission.
Section 9.3: Legal Hofidaysln any case where the date interest accrues and becomes
payable on the Certificates or principal of the Certificates matures or the date fixed for redemption
of any Certificates or a Record Date shall be in the City a Saturday, Sunday, legal holiday or a day
on which banking institutions are authorized by law to close, then payment of interest or principal
need not be made on such date, or the Record Date shall not occur on such date, but payment may
be made or the Record Date shall occur on the next succeeding day which is not in the City a
Saturday, Sunday, legal holiday or a day on which banking institutions are authorized by law to
close with the same force and effect as if (i) made on the date of maturity or the date fixed for
redemption and no interest shall accrue for the period from the date of maturity or redemption to
the date of actual payment or (ii) the Record Date had occurred on the fifteenth calendar day of
that month.
Section 9.4: Power to Revise Form of DocumentsNotwithstanding any other
provision of this Ordinance, the Mayor is hereby authorized to make or approve such revisions,
additions, deletions, and variations to this Ordinance and in the form of the documents attached
hereto as exhibits as, in the judgment of the Mayor, and in the opinion of Bond Counsel to the
City, may be necessary or convenient to carry out or assist in carrying out the purposes of this
Ordinance, the Preliminary Official Statement, the final Official Statement, or as may be required
for approval of the Certificates by the Attorney General of Texas; provided, however, that any
changes to such documents resulting in substantive amendments to the terms and conditions of the
Certificates or such documents shall be subject to the prior approval of the City Council.
Section 9.5: No Recourse Against City OfticialsNo recourse shall be had for the
payment of principal of or interest on any Certificates or for any claim based thereon or on this
Ordinance against any official of the City or any person executing any Certificates.
Section 9.6: Further ProceedingsThe Mayor, Mayor Pro-Tem, City Secretary and
other appropriate officials of the City are hereby authorized and directed to do any and all things
necessary and/or convenient to carry out the terms of this Ordinance.
Section 9.7: Severabilitylf any Section, paragraph, clause or provision of this
Ordinance shall for any reason be held to be invalid or unenforceable, the invalidity or
unenforceability of such Section, paragraph, clause or provision shall not affect any of the
remaining provisions of this Ordinance.
Section 9.8: Open MeetingIt is hereby found, determined and declared that a sufficient
written notice of the date, hour, place and subject of the meeting of the City Council at which this
Ordinance was adopted was posted at a place convenient and readily accessible at all times to the
general public at City Hall for the time required by law preceding this meeting, as required by the
Open Meetings Law, Chapter 551, Texas Government Code, and that this meeting has been open
to the public as required by law at all times during which this Ordinance and the subject matter
21
thereof has been discussed, considered and formally acted upon. The City Council further ratifies,
approves and confirms such written notice and the contents and posting thereof.
Section 9.9: RepealerAll orders, resolutions and ordinances, or parts thereof,
inconsistent herewith are hereby repealed to the extent of such inconsistency.
Section 9.10: Effective DateThis Ordinance shall be in force and effect from and after
its passage on the date shown below.
[Signature page follows.]
22
DULY PASSED AND APPROVED this the 12th day of July, 2021.
CITY OF LA O TE, TEXAS
May r
ATTEST
City a tary
(SEAL) Y
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099900.24203 EMF_US 85689/91v2
NUMBER
R-1
REGISTERED
INTEREST RATE':
aka
DATED DATE:
REGISTERED OWNER:
PRINCIPAL AMOUNT:
EXHIBIT A
FORM OF CERTIFICATE
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF LA PORTE, TEXAS,
CERTIFICATE OF OBLIGATION
SERIES 2021
ISSUANCE DATE:
August _, 2021
July 1, 2021
MATURITY DATE':
March 15,
DENOMINATION
REGISTERED
CUSIP':
DOLLARS
THE CITY OF LA PORTE, TEXAS, a municipal corporation of the State of Texas (the
"City"), for value received, hereby promises to pay to the Registered Owner identified above or
its registered assigns, on the Maturity Date specified above (or on earlier redemption as herein
provided), upon presentation and surrender of this Certificate at the principal corporate trust office
of Zions Bancorporation, National Association, or its successor (the "Paying Agent/Registrar"),
the principal amount identified above (or so much thereof as shall not have been paid or deemed
to have been paid upon prior redemption) payable in any coin or currency of the United States of
America which on the date of payment of such principal is legal tender for the payment of debts
due to the United States of America, and to pay interest thereon at the rate shown above, calculated
on a basis of a 360-day year composed of twelve 30-day months, from the later of the Issuance
Date identified above or the most recent interest payment date to which interest has been paid or
duly provided for.' Interest on this Certificate is payable on March 15, 2022, and each September
' Initial Certificate shall be numbered 1-1.
' Omitted from initial Certificate.
' The first sentence of the initial Certificate shall read as follows:
THE CITY OF LA PORTE, TEXAS, a municipal corporation of the State of Texas (the "City"), for value received,
hereby promises to pay to the Registered Owner identified above or its registered assigns, on March 15 of each of the
years and in the principal amounts set forth in the following schedule: [Insert information regarding years of maturity,
principal amounts and interest rates from Section 3.3 of the Ordinance.] (or on earlier redemption as herein provided),
upon presentation and surrender of this Certificate at the principal corporate trust office of Zions Bancorporation,
National Association, or its successor (the "Paying Agent/Registrar"), the principal amounts identified above (or so
much thereof as shall not have been paid or deemed to have been paid upon prior redemption) payable in any coin or
currency of the United States of America which on the date of payment of such principal is legal tender for the payment
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09 W.2N203 EMF_US 85689]91v2
15 and March 15 thereafter until maturity or earlier redemption of this Certificate, by check sent
by United States mail, first class, postage prepaid, by the Paying Agent/Registrar to the Registered
Owner of record as of the close of business on the last business day of the calendar month
immediately preceding the applicable interest payment date, as shown on the registration books
kept by the Paying Agent/Registrar. Any accrued interest payable at maturity or earlier redemption
shall be paid upon presentation and surrender of this Certificate at the principal corporate trust
office of the Paying Agent/Registrar.
THIS CERTIFICATE IS ONE OF A DULY AUTHORIZED SERIES OF
CERTIFICATES (the "Certificates") in the aggregate principal amount of $[13,500,000] issued
pursuant to an ordinance adopted by the City Council of the City on July 12, 2021 (the
"Ordinance"), for the purpose of providing all or part of the funds to pay contractual obligations
to be incurred for the construction of public works and the purchase of materials, supplies,
equipment, machinery, buildings, land and rights -of -way for authorized needs and purposes and
for the payment of contractual obligations for professional services, to wit (i) planning,
acquisition, design, construction and equipment of a new City Hall, (ii) renovation, improvement
and equipment of existing City buildings, (iii) construction, improvement, extension, upgrade and
development of City streets, including drainage, streetscaping, signalization and other traffic
controls, sidewalks, street lights and the acquisition of any right-of-way, (iv) drainage
improvements, (v) construction, renovation, improvement, and equipment of the City's water and
sewer system, (vi) purchase of land for and construction, renovation, improvement, and equipment
of the City's Bay Forest Golf Course and related facilities, and (vii) the cost of professional
services rendered in connection the above listed projects.
THE CITY RESERVES THE RIGHT, at its option, to redeem, prior to their maturity,
Certificates maturing on or after March 15, [20 ], in whole or in part, in inverse order of maturity,
on March 15, [20_], or any date thereafter, at par plus accrued interest to the date fixed for
redemption.
THE CERTIFICATES MAY BE REDEEMED IN PART only in integral multiples of
$5,000. If a Certificate subject to redemption is in a denomination larger than $5,000, a portion of
such Certificate may be redeemed, but only in integral multiples of $5,000. In selecting portions
of Certificates for redemption, each Certificate shall be treated as representing that number of
Certificates of $5,000 denomination which is obtained by dividing the principal amount of such
Certificate by $5,000. Upon surrender of any Certificate for redemption in part, the Paying
Agent/Registrar, in accordance with the provisions of the Ordinance, shall authenticate and deliver
in exchange therefor a Certificate or Certificates of like maturity and interest rate in an aggregate
principal amount equal to the umedee red portion of the Certificate so surrendered.
NOTICE OF ANY SUCH REDEMPTION, identifying the Certificates or portions thereof
to be redeemed, shall be sent by United States mail, first class, postage prepaid, to the Registered
Owners thereof at their addresses as shown on the books of registration kept by the Paying
Agent/Registrar, not less than thirty (30) days before the date fixed for such redemption. By the
date fixed for redemption, due provision shall be made with the Paying Agent/Registrar for the
payment of the redemption price of the Certificates called for redemption. If such notice of
of debts due to the United States of America, and to pay interest thereon at the rate shown above, calculated on a basis
of a 360-day year composed of twelve 30-day months, from the later of the Issuance Date identified above or the
most recent interest payment date to which interest has been paid or duly provided for.
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099900.26203 EMF_US 85689791 �2
redemption is given, and if due provision for such payment is made, all as provided above, the
Certificates which are to be so redeemed thereby automatically shall be redeemed prior to their
scheduled maturities, they shall not bear interest after the date fixed for redemption, and they shall
not be regarded as being outstanding except for the purpose of being paid with the funds so
provided for such payment.
THIS CERTIFICATE IS TRANSFERABLE only upon presentation and surrender at the
principal corporate trust office of the Paying Agent/Registrar, accompanied by an assignment duly
executed by the Registered Owner or its authorized representative, subject to the terms and
conditions of the Ordinance.
THIS CERTIFICATE IS EXCHANGEABLE at the principal corporate trust office of the
Paying Agent/Registrar for a Certificate or Certificates of the same maturity and interest rate and
in the principal amount of $5,000 or any integral multiple thereof, subject to the terms and
conditions of the Ordinance.
THE PAYING AGENT/REGISTRAR is not required to accept for transfer or exchange
any Certificate called for redemption, in whole or in part, during the forty-five (45) day period
immediately prior to the date fixed for redemption; provided, however, that such limitation shall
not apply to the transfer or exchange by the Registered Owner of an unredeemed portion of a
Certificate called for redemption in part.
THE CITY OR PAYING AGENT/REGISTRAR may require the Registered Owner of any
Certificate to pay a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with the transfer or exchange of a Certificate. Any fee or charge of the
Paying Agent/Registrar for a transfer or exchange shall be paid by the City.
THE REGISTERED OWNER of this Certificate by acceptance hereof, acknowledges and
agrees to be bound by all the terms and conditions of the Ordinance.
IT IS HEREBY DECLARED AND REPRESENTED that this Certificate has been duly
and validly issued and delivered; that all acts, conditions and things required or proper to be
performed, exist and to be done precedent to or in the issuance and delivery of this Certificate have
been performed, exist and have been done in accordance with law; that the Certificates do not
exceed any constitutional or statutory limitation; and that annual ad valorem taxes sufficient to
provide for the payment of the interest on and principal of this Certificate, as such interest comes
due and such principal matures, have been levied and ordered to be levied, within the limits
prescribed by law, against all taxable property in the City and have been irrevocably pledged for
such payment.
IT IS FURTHER DECLARED AND REPRESENTED that the revenues to be derived
from the City's waterworks and sewer system, after the payment of all operation and maintenance
expenses thereof (the "Net Revenues"), in an amount not to exceed $1,000, are pledged to the
payment of the principal of and interest on the Certificates, provided that the pledge of Net
Revenues is and shall be junior and subordinate in all respects to the pledge of Net Revenues to
the payment of any obligation of the City, whether authorized heretofore or hereafter, which the
City designates as having a pledge senior to the pledge of the Net Revenues to the payment of the
Certificates. The City also reserves the right to issue, for any lawful purpose at any time, in one
or more installments, bonds, certificates of obligation and other obligations of any kind, secured
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099900.24203 EMF_US 85689791 v2
in whole or in part by a pledge of Net Revenues, that may be prior and superior in right to, on a
parity with, or junior and subordinate to the pledge of Net Revenues securing the Certificates.
REFERENCE IS HEREBY MADE TO THE ORDINANCE, a copy of which is filed with
the Paying Agent/Registrar, for the full provisions thereof, to all of which the Registered Owners
of the Certificates assent by acceptance of the Certificates.
THIS CERTIFICATE shall not be valid or obligatory for any purpose or be entitled to any
benefit under the Ordinance unless this Certificate is authenticated by the Paying AgentlRegistrar
by due execution of the authentication certificate endorsed hereon.'
IN WITNESS WHEREOF, the City has caused its corporate seal to be impressed or placed
in facsimile hereon and this Certificate to be signed by the Mayor, countersigned by the City
Secretary by their manual, lithographed or printed facsimile signatures.
(SEAL)
° In the initial Certificate, this paragraph shall read:
"THIS CERTIFICATE shall not be valid or obligatory for any purpose or be entitled to
any benefit under the Ordinance unless this Certificate is registered by the Comptroller of Public
Accounts of the State of Texas by due execution of the registration certificate endorsed hereon."
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09990024203 EMF_US 85689791v2
FORM OF COMPTROLLER'S REGISTRATION CERTIFICATE
The following form of Comptroller's Registration Certificate shall be attached or affixed
to each of the Certificates initially delivered:
THE STATE OF TEXAS
REGISTER NO.
OFFICE OF THE COMPTROLLER OF PUBLIC ACCOUNTS
I hereby certify that this certificate has been examined, certified as to validity and approved
by the Attorney General of the State of Texas, and that this certificate has been registered by the
Comptroller of Public Accounts of the State of Texas.
WITNESS MY SIGNATURE AND SEAL OF OFFICE this
[SEAL]
Comptroller of Public Accounts
of the State of Texas
• a a
FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
The following form of authentication certificate shall be printed on the face of each of the
Certificates other than those initially delivered:
AUTHENTICATION CERTIFICATE
This Certificate is one of the Certificates described in and delivered pursuant to the within -
mentioned Ordinance; and, except for the Certificates initially delivered, this Certificate has been
issued in exchange for or replacement of a Certificate, Certificates, or a portion of a Certificate or
Certificates of an issue which originally was approved by the Attorney General of the State of
Texas and registered by the Comptroller of Public Accounts of the State of Texas.
ZIONS BANCORPRATION,
NATIONAL ASSOCIATION,
as Paying Agent/Registrar
Authorized Signature
Date of Authentication:
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099900.24203 EMF_US 85089791v2
FORM OF ASSIGNMENT
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers
(Please print or type name, address, and zip code of Transferee)
(Please insert Social Security or Taxpayer Identification Number of Transferee)
the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints
attorney to transfer such certificate on the books kept for
registration thereof, with full power of substitution in the premises.
DATED:
Signature Guaranteed:
NOTICE: Signature must be guaranteed by a
member firm of the New York Stock
Exchange or a commercial bank or trust
company.
Registered Owner
NOTICE: The signature above must
correspond to the name of the Registered
Owner as shown on the face of this certificate
in every particular, without any alteration,
enlargement or change whatsoever.
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099900.U203 EMF_US 85689791v2