HomeMy WebLinkAboutOrdinance 1782
ORDINANCE NO. 1782
AN ORDINANCE authorizing the issuance of "CITY OF
NORTH RICHLAND HILLS, TEXAS, GENERAL
OBLIGATION REFUNDING BONDS, SERIES 1992" and
"CITY OF NORTH RICHLAND HILLS, TEXAS,
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES
1992-A"; specifying the terms and features
of said bonds; levying a continuing direct
annual ad valorem tax for the payment of
said bonds; and resolving other matters
incident and related to the issuance, sale,
payment and delivery of said bonds,
including the approval and execution of a
Bond Purchase Agreement and Special Escrow
Agreement and the approval and distribution
of an Official Statement pertaining thereto;
and providing an effective date.
WHEREAS, the City Council of the City of North Richland
Hills, Texas (the "City") has heretofore issued, sold, and
delivered, and there is currently outstanding obligations
totalling in principal amount $17,800,000 of the following
issue or series (hereinafter called the "Refunded
Obligations"), to wit:
(1) City of North Rich1and Hills, Texas,
General Obligation Refunding and Improvement
Bonds, Series 1985, dated November 1, 1985,
maturing on February 15, 1996 through
February 15, 1999, and aggregating in principal
amount of
$4,010,000
(2) City of North Rich1and Hills, Texas,
General Obligation Bonds, Series 1986, dated
August 1, 1986, maturing on February 15, 1997
through February 15, 2007, and aggregating in
principal amount of
$4,490,000
(3) City of North Rich1and Hills, Texas,
General Obligation Bonds, Series 1987, dated
July 1, 1987, maturing on February 15, 1998
through February 15, 2008, and aggregating in
principal amount of
$5,810,000
(4) City of North Rich1and Hills, Texas,
General Obligation Bonds, Series 1989, dated
March 1, 1989, maturing on February 15, 2000
through February 15, 2009, and aggregating in
principal amount of
$3,490,000
AND WHEREAS, pursuant to the provisions of Article 7l7k,
V.A.T.C.S., as amended, the City Council is authorized to issue
refunding bonds and deposit the proceeds of sale thereof
directly with the place of payment for the Refunded
Obligations, and such deposit, when made in accordance with
said statute, shall constitute the making of firm banking and
financial arrangements for the discharge and final payment of
the Refunded Obligations; and
WHEREAS, the City Council hereby finds and determines that
the Refunded Obligations should be refunded at this time to
take advantage of debt service savings of approximately
$692,521.52, and the Refunded Obligations are scheduled to
mature, or are subject to being redeemed, not more than twenty
(20) years from the date of the refunding bonds herein
authorized; and
WHEREAS, in addition to the bonds to be issued to refund
the Refunded Obligations, the City Council further finds and
determines that $4,400,000 in principal amount of general
obligation bonds approved and authorized to be issued at an
election held on September 10, 1985 should be issued and sold
at this time; a summary of the general obligation bonds
authorized at said election, the principal amount authorized,
amounts heretofore issued and being issued pursuant to this
ordinance and amounts remaining to be issued subsequent hereto
being as follows:
Total Amounts Amounts
Amount Heretofore Being Unissued
Purpose Authorized Issued Issued Balance
Street $14,475,000 $11 ,495 ,000 $1,400,000 $ 1,580,000
Drainage 16,870,000 7,585,000 3,000,000 6,285,000
AND WHEREAS, the City Council hereby reserves and retains
the right to issue the balance of unissued bonds approved at
said election in one or more installments when, in the judgment
of the Council, funds are needed to accomplish the purposes for
which such bonds were voted; and
WHEREAS, to preserve the rights of the City under current
federal income tax laws to advance refund the $4,400,000 in
principa 1 amount of new money bonds herein authorized wi th .. tax
exempt obligations" at a future date or dates, it is necessary
for the City to issue and sell the refunding bonds and the new
money bonds herein authorized as two separate and distinct
series of obligations; now, therefore,
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BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF NORTH
RICHLAND HILLS, TEXAS:
SECTION 1: Authorization-Designation-Principal Amount-
Purpose - Date. In conformity with the Constitution and laws
of the State of Texas, particularly Articles 717k and 1175,
V.A.T.C.S., general obligation bonds of the City shall be and
are hereby authorized to be issued and such general obligation
bonds shall be issued as two series of obligations as follows:
(i) "CITY OF NORTH RICHLAND HILLS, TEXAS, GENERAL OBLIGATION
REFUNDING BONDS, SERIES 1992" (hereinafter referred to as the
"Series 1992 Bonds") for the purpose of providing funds for the
discharge and final payment of certain outstanding obligations
of the City (identified in the preamble hereof and referred to
as the "Refunded Obligations") and to pay costs of issuance,
and (i i) "CITY OF NORTH RICHLAND HILLS, TEXAS, GENERAL
OBLIGATION IMPROVEMENT BONDS, SERIES 1992-A" (hereinafter
referred to as the "Series 1992-A Bonds") for permanent public
improvements and public purposes, to wit: $1,400,000 for street
improvements, including drainage incidental thereto and the
acquisition of land and right-of-way therefor, and $3,000,000
for flood control/storm sewer improvements. The Series 1992
Bonds and the Series 1992-A Bonds are hereinafter collectively
referred to as the "Bonds" . The Bonds sha 11 be dated
February I, 1992 (the "Issue Date") and shall be issued as
fully registered obligations, without coupons.
SECTION 2: Fully Registered Interest Paying/Non-Interest
Paying Obligations Terms. (a) Series 1992 Bonds. The
Series 1992 Bonds shall be issued in the aggregate principal
amount of $17,799,932.25 and in part as "Current Interest
Bonds" (obligations paying accrued interest to the holders or
owners on and at stated intervals prior to maturity or
redemption) totalling $17,450,000 in principal amount and in
part as "Capital Appreciation Bonds" (obligations paying no
accrued interest to the holders or owners prior to maturi ty)
totalling $349,932.25 in original principal amount and
aggregating in Maturity Amount $5,440,000.
(1) The Current Interest Bonds of the Series 1992 Bonds
(other than the Initial Bond referenced in Section 8 hereof)
shall be in denominations of $5,000 or any integral multiple
(within a Stated Maturi ty) thereof, shall be lettered "R- "
and the definitive obligations shall be numbered consecutively
from One (1) upward and shall become due and payable on
February 15 in each of the years and in principal amounts (the
"Stated Maturi ties") and bear interest at the rates per annum
in accordance with the following schedule:
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Year of
Stated Maturity
Principal
Amount
Interest
Rate(s)
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
$ 370,000
385,000
400,000
1,610,000
1,885,000
1,930,000
1,610,000
1,315,000
1,395,000
1,485,000
1,580,000
1,685,000
1,800,000
3.75%
4.30%
4.65%
4.80%
5.10%
5.35%
5.55%
5.70%
5.85%
6.00%
6.10%
6.20%
6.30%
The Current Interest Bonds of the Series 1992 Bonds
shall bear interest (calculated on the basis of a 360-day year
of twelve 30-day months) on the unpaid principal amounts from
the Issue Date at the per annum rate(s) shown in the schedule
hereafter appearing, and such interest shall be payable on
February 15 and August 15 in each year, commencing August 15,
1992.
(2) The Capital Appreciation Bonds of the Series 1992
Bonds shall each be issued in Maturity Amounts (the "Accreted
Va lue" [as hereinafter defined] at maturi ty) of $5,000, or any
integral multiple thereof within a Stated Maturity (except for
the Initial Bond referenced in Section 8 hereof), shall be
lettered "CAB- " and the definitive obligations shall be
numbered consecutively from One (1) upward, and shall be issued
in original principal amounts, which shall ace rete in value at
the interest rate(s) stated in the table below, and shall
become due and payable on February 15 in each of the years (the
"Stated Maturities") in the Maturity Amounts set forth in the
following table:
Stated
Year of Original Principal Interest Maturity Stated
Maturity Amount Rate Amount Yield*
2006 $ 143,567.70 19.28% $1,865,000 6.80,%
2007 119,434.60 19.28% 1,865,000 6.85%
2008 66,321.15 19.28% 1,245,000 6.85%
2009 20,608.80 19.28% 465,000 6.90%
* based on initial premium paid
Interest on such Capital Appreciation Bonds shall accrue
from the date of delivery of the Bonds to the initial
purchasers (March 10, 1992) and compound semiannually on
February 15 and August 15 in each year, commencing August 15,
1992, until the Stated Maturity. The accrued interest on
Capital Appreciation Bonds shall be payable at maturity as a
portion of the Maturity Amount.
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The term "Accreted Value", as herein used with respect to
Capital Appreciation Bonds, shall mean the original principal
amount of a Capital Appreciation Bond plus the initial premium,
if any, paid therefor wi th interest thereon compounded
semiannually to February 15 or August IS, as the case may be,
next preceding the date of such calculation (or the date of
calculation, if such calculation is made on February 15 or
August 15), at the respective stated yield(s) in the schedule
hereinabove appearing therefor and, with respect to each $5,000
Accreted Value at maturity, as set forth in the Accreted Value
table appearing in the Official Statement referred to in
Section 16 hereof. For any day other than a February 15 or
August IS, the Accreted Value of a Capital Appreciation Bond
shall be determined by a straight line interpolation between
the values for the applicable semiannual compounding dates
(based on 30-day months).
(b) Series 1992-A Bonds. The Series 1992-A Bonds shall
be issued only as Current Interest Bonds in the aggregate
principal amount of $4,400,000 and (other than the Initial Bond
referenced in Section 8 hereof) shall be in denominations of
$5,000 or any integral multiple (within a Stated Maturity)
thereof, shall be lettered "R- " and the definitive
obligations shall be numbered consecutively from One (1) upward
and shall become due and payable on February 15 in each of the
years and in principal amounts (the "Stated Maturities") and
bear interest at the rates per annum in accordance wi th the
following schedule:
Year of
Stated Maturity
Principal
Amount
Interest
Rate(s)
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
$135,000
140,000
145,000
155,000
160,000
170,000
180,000
190,000
205,000
215,000
230,000
245,000
260,000
275,000
295,000
315,000
340,000
360,000
385,000
4.30%
4.65%
4.90%
5.20%
5.45%
5.65%
5.80%
5.95%
6.10%
6.20%
6.30%
6.40%
6.45%
6.50%
6.55%
6.60%
6.65%
6.70%
6.75%
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The Current Interest Bonds of the Series 1992-A Bonds
shall bear interest (calculated on the basis of a 360-day year
of twelve 30-day months) on the unpaid principal amounts from
the Issue Date at the per annum rate(s) shown in the schedule
hereafter appearing, and such interest shall be payable on
February 15 and August 15 in each year, commencing February 15,
1993.
SECTION 3: Terms of Payment - Paying Agent/Registrar.
The principal of, premium, if any, and the interest on the
Bonds, due and payable by reason of maturi ty, redemption or
otherwise, shall be payable only to the registered owners or
holders of the Bonds (hereinafter called the "Holders")
appearing on the registration and transfer books (the "Security
Register") for the Bonds maintained by the Paying
Agent/Registrar and the payment thereof shall be in any coin or
currency of the United States of America, which at the time of
payment is legal tender for the payment of public and private
debts, and shall be without exchange or collection charges to
the Holders.
The selection and appointment of Team Bank, Fort Worth,
Texas to serve as Paying Agent/Registrar for the Bonds is
hereby approved and confirmed. The City covenants to maintain
and provide a Paying Agent/Registrar at all times until the
Bonds are paid and discharged, and any successor Paying
Agent/Registrar shall be a bank, trust company, financial
institution or other entity qualified and authorized to serve
in such capacity and perform the duties and services of Paying
Agent/Registrar. Upon any change in the Paying
Agent/Registrar for the Series 1992 Bonds or Series 1992-A
Bonds, the City agrees to promptly cause a written notice
thereof to be sent to each Holder by United States Mail, first
class postage prepaid, which notice shall also give the address
of the new Paying Agent/Registrar.
The Bonds shall be payable at their Stated Maturities or
upon their earlier redemption only upon the presentation and
surrender to the principal office of the Paying
Agent/Registrar. Interest on a Capital Appreciation Bond shall
be payable at its Stated Maturity as a portion of the Accreted
Value or Maturi ty Amount. Interest on a Current Interest Bond
shall be paid to the Holders whose names appear in the Security
Register at the close of business on the Record Date (the last
business day of the month next preceding each interest payment
date) and shall be paid by the Paying Agent/Registrar (i) by
check sent United States Mail, first class postage prepaid, to
the address of the Holder recorded in the Security Register or
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(ii) by such other method, acceptable to the Paying
Agent/Registrar, requested by, and at the risk and expense of,
the Holder. If the date for the payment of the Bonds shall be
a Saturday, Sunday, a legal holiday, or a day when banking
institutions in the City where the Paying Agent/Registrar is
located are authorized by law or executive order to close, then
the date for such payment shall be the next succeeding day
which is not such a Saturday, Sunday, legal holiday, or day
when 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.
In the event of a non-payment of interest on one or more
maturities on a scheduled payment date on the Current Interest
Bonds, and for thirty (30) days thereafter, a new record date
for such interest payment for such maturi ty or maturi ties (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 City. Notice of the
Special Record Date and of the scheduled payment date of the
past due interest (which shall be 15 days after the Special
Record Date) shall be sent at least five (5) business days
prior to the Special Record Date by United States Mail, first
class postage prepaid, to the address of each Holder of the
Current Interest Bonds appearing on the Securi ty Register at
the close of business on the last business day next preceding
the date of mailing of such notice.
SECTION 4: Redemption. (a) Optional Redemption. (1) The
Current Interest Bonds of both series having Stated Maturi ties
on and after February 15, 2003, shall be subject to redemption
prior to maturity, at the option of the City, in whole or in
part in principal amounts of $5,000 or any integral multiple
thereof (and if wi thin a Stated Maturi ty by lot by the Paying
Agent/ Registrar), on February 15, 2002 or on any date
thereafter at the redemption price of par, together with
accrued interest to the redemption date.
(2) The Capital Appreciation Bonds of the Series 1992
Bonds shall not be subject to redemption at the option of the
City prior to their Stated Maturities.
(b) Exercise of Redemption Option. At least
forty-five (45) days prior to a date set for the redemption of
Bonds (unless a shorter notification period shall be
satisfactory to the Paying Agent/Registrar), the City shall
notify the Paying Agent/Registrar of its decision to redeem
Bonds, the series of Bonds to be redeemed, the principal
amount of each Stated Maturity to be redeemed, and the date
set for the redemption thereof. The decision of the Ci ty to
exercise the right to redeem Bonds shall be entered in the
minutes of the governing body of the City.
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(c) Selection of Bonds for Redemption. If less than all
Outstanding Current Interest Bonds of the same series and same
Stated Maturity are to be redeemed on a redemption date, the
Paying Agent/Registrar shall treat such Bonds as representing
the number of Bonds Outstanding which is obtained by dividing
the principal amount by $5,000 and shall select the Current
Interest Bonds of like series to be redeemed within such Stated
Maturity, by lot.
(d) Notice of Redemption. Not less than thirty (30) days
prior to a redemption date for the Bonds, a notice of
redemption shall be sent by United States Mail, first class
postage prepaid, in the name of the Ci ty and at the Ci ty' s
expense, to each Holder of a Bond to be redeemed in whole or in
part at the address of the Holder appearing on the Securi ty
Register at the close of business on the last business day next
preceding the date of mailing such notice, and any notice of
redemption so mailed shall be conclusively presumed to have
been duly given irrespective of whether received by the Holder.
All not ices of redempt ion sha 11 (i) speci fy the date of
redemption for the Bonds, (ii) identify by series and number
the Bonds to be redeemed and, in the case of a portion of the
principal amount to be redeemed, the principal amount thereof
to be redeemed, (iii) state the redemption price, (iv) state
that the Bonds, or the port ion of the principa 1 amount to be
redeemed, sha 11 become due and payable on the redempt ion date
specified, and the accrual of interest shall cease from and
after the redemption date, and (v) specify that payment of the
redemption price for the Bonds, or the principal amount to be
redeemed, shall be made at the principal office of the Paying
Agent/Registrar only upon presentation and surrender of the
Bonds to be redeemed, in whole or in part, by the Holder. If a
Bond is subject by its terms to prior redemption and has been
called for redemption and notice of redemption has been duly
given or waived as herein provided, such Bond (or the principal
amount to be redeemed) shall become due and payable, and
interest thereon shall cease to accrue from and after the
redemption date therefor, provided moneys sufficient for the
payment of such Bonds (or of the principal amount to be
redeemed) at the then applicable redemption price are held for
the purpose of such payment by the Paying Agent/Registrar.
SECTION 5: Registration - Transfer - Exchange of Bonds
Predecessor Bonds. A separate Security Register for the
Series 1992 Bonds and for the Series 1992-A Bonds (each
Security Register relating to the registration, payment, and
transfer or exchange of the bonds of such series) shall at all
times be kept and maintained on behalf of the City by the
Paying Agent/Registrar, as provided herein and in accordance
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with the provisions of an agreement with the Paying
Agent/Registrar and such rules and regulations as the Paying
Agent/Registrar and the Ci ty may prescribe. The Paying
Agent/Registrar shall obtain, record, and maintain in the
appropriate Security Register the name and address of each
registered owner of the Bonds issued under and pursuant to the
provisions of this Ordinance. Any Bond may, in accordance with
its terms and the terms hereof, be transferred or exchanged for
Bonds of the same series, of like kind (Current Interest Bonds
or Capital Appreciation Bonds), of other authorized
denominations upon the Security Register by the Holder, in
person or by his duly authorized agent, upon surrender of such
Bond to the Paying Agent/Registrar for cancellation,
accompanied by a written instrument of transfer or request for
exchange duly executed by the Holder or by his duly authorized
agent, in form satisfactory to the Paying Agent/Registrar.
Upon surrender for transfer of any Bond at the principal
office of the Paying Agent/Registrar, the Paying
Agent/Registrar shall register and deliver, in the name of the
designated transferee or transferees, one or more new Bonds,
executed on behalf of, and furnished by, the City of like
series, of authorized denominations and of like Stated Maturity
and of a like aggregate principal amount (with respect to
Current Interest Bonds) or Maturity Amount (with respect to
Capital Appreciation Bonds) as the Bond or Bonds surrendered
for transfer.
At the option of the Holder, Bonds may be exchanged for
other Bonds of the same series, of authorized denominations and
having the same Stated Maturity, bearing the same rate of
interest and of like aggregate principal amount (with respect
to Current Interest Bonds) or Maturity Amount (with respect to
Capital Appreciation Bonds) as the Bonds surrendered for
exchange, upon surrender of the Bonds to be exchanged at the
principal office of the Paying Agent/ Registrar. Whenever any
Bonds are surrendered for exchange, the Paying Agent/Registrar
shall register and deliver new Bonds, executed on behalf of,
and furnished by, the City, to the Holder requesting the
exchange.
All Bonds issued upon any such transfer or exchange shall
be delivered at the principal office of the Paying
Agent/Registrar, or sent by United States Mail, first class
postage prepaid, to the Holder and, upon the delivery thereof,
the same shall be valid obligations of the City, evidencing the
same obligation to pay, and entitled to the same benefits under
this Ordinance, as the Bonds surrendered in such transfer or
exchange.
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All transfers or exchanges of Bonds pursuant to this
Section shall be made without expense or service charge to the
Holder, except as otherwise herein provided, and except that
the Paying Agent/Registrar shall require payment by the Holder
requesting such transfer or exchange of any tax or other
governmental charges requi red to be paid wi th respect to such
transfer or exchange.
Bonds cancelled by reason of an exchange or transfer
pursuant to the provisions hereof are hereby defined to be
"Predecessor Bonds," evidencing all or a portion, as the case
may be, of the same obligation to pay evidenced by the Bond or
Bonds registered and delivered in the exchange or transfer
therefor. Additionally, the term "Predecessor Bonds" shall
include any mutilated, lost, destroyed, or stolen Bond for
which a replacement Bond has been issued, registered and
delivered in lieu thereof pursuant to Section 11 hereof and
such new replacement Bond shall be deemed to evidence the same
obligation as the mutilated, lost, destroyed, or stolen Bond.
Neither the City nor the Paying Agent/Registrar shall be
required to transfer or exchange any Current Interest Bond
called for redemption, in whole or in part, within 45 days of
the date fixed for redemption of such Current Interest Bond;
provided, however, such limitation on transferability shall not
be applicable to an exchange by the Holder of the unredeemed
balance of a Current Interest Bond called for redemption in
part.
SECTION 6: Book-Entry Only Transfers and Transactions.
Notwithstanding the provisions contained in Sections 3, 4 and 5
hereof relating to the payment, and transfer/exchange of the
Bonds, the City hereby approves and authorizes the use of
"Book-Entry Only" securities clearance, settlement and transfer
system provided by The Depository Trust Company (DTC), a
limi ted purpose trust company organized under the laws of the
State of New York, in accordance with the requirements and
procedures identified in respective the Letters of
Representation, by and between the City, the Paying
Agent/Registrar' and DTC (the "Depository Agreement") executed
in connection with each series of Bonds.
Pursuant to the Depository Agreement and the rules of DTC,
the Series 1992 Bonds and the Series 1992-A Bonds sha 11 be
deposited with DTC who shall hold said Bonds for its
participants (the "DTC Participants"). While the Series 1992
Bonsd and the Series 1992-A Bonds are held by DTC under each
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applicable Depository Agreement, the Holder of the Bonds on the
Security Register for all purposes, including payment and
notices, shall be Cede & Co., as nominee of DTC,
notwithstanding the ownership of each actual purchaser or owner
of each Bond (the "Beneficial Owners") being recorded in the
records of DTC and DTC Participants.
In the event DTC determines to discontinue serving as
securities depository for either series of Bonds, or both
series, or otherwise ceases to provide book-entry clearance and
settlement of securities transactions in general or the City
determines that DTC is incapable of properly discharging its
duties as securities depository for the Bonds, the City
covenants and agrees wi th the Holders of the Bonds to cause
Bonds for each series to be printed in definitive form and
provide for appropriate Bond certificates to be issued and
delivered to DTC Participants and Beneficial Owners, as the
case may be. Thereafter, each series of Bonds in defini ti ve
form shall be assigned, transferred and exchanged on the
appropriate Security Register maintained by the Paying
Agent/Registrar and payment of such Bonds shall be made in
accordance with the provisions of Sections 3, 4 and 5 hereof.
SECTION 7: Execution Registration. The Bonds of
each series shall be executed on behalf of the City by the
Mayor under its seal reproduced or impressed thereon and
countersigned by the City Secretary. The signature of said
officers on the Bonds may be manual or facsimile. Bonds
bearing the manual or facsimile signatures of individuals who
are or were the proper officers of the City on the Issue Date
shall be deemed to be duly executed on beha If of the Ci ty,
notwithstanding that such individuals or either of them shall
cease to hold such offices at the time of delivery of the Bonds
to the initial purchaser(s) and with respect to Bonds of each
series delivered in subsequent exchanges and transfers, all as
authorized and provided in the Bond Procedures Act of 1981, as
amended.
No Bond of either series shall be entitled to any right or
benefit under this Ordinance, or be valid or obligatory for any
purpose, unless there appears on such Bond either a certificate
of registration substantially in the form provided in
Section 9C, manually executed by the Comptroller of Public
Accounts of the State of Texas or his duly authorized agent, or
a certificate of registration substantially in the form
provided in Section 9D, manually executed by an authorized
officer, employee or representative of the Paying Agent/
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Registrar, and
signed shall be
that such Bond
delivered.
ei ther such
conclusive
has been
certificate upon any Bond duly
evidence, and the only evidence,
duly certified, registered and
SECTION 8: Initial Bonds. The Series 1992 Bonds
herein authorized shall be initially issued as two (2) fully
registered bonds, being (i) a single fully registered Current
Interest Bond in the aggregate principal amount shown in
Section 2(a) hereof with principal installments to become due
and payable as provided in Section 2(a)(1) hereof and numbered
TR-l and (ii) a single fully registered Capital Appreciation
Bond in the aggregate Maturity Amount appearing in Section 2(a)
hereof with installments of such Maturity Amount to become due
and payable as provided in Section 2(a)(2) hereof and numbered
TCAB-l. The Series 1992-A Bonds herein authorized shall be
initially issued as one (1) fully registered bond in the
aggregate principal amount shown in Section 2 (b) hereof wi th
principal installments to become due and payable as provided in
Section 2(b) hereof and numbered TR-l. The two (2) initial
bonds for the Series 1992 Bonds and the one (1) initial bond
for the Series 1992-A Bonds (hereinafter collectively called
the "Initial Bonds") shall be registered in the name of the
initial purchaser(s), or the designee thereof. The Initial
Bonds shall be the Bonds of each series submitted to the Office
of the Attorney General of the State of Texas for approval,
certified and registered by the Office of the Comptroller of
Public Accounts of the State of Texas and delivered to the
initial purchaser(s). Any time after the delivery of the
Initial Bonds, the Paying Agent/Registrar, pursuant to written
instructions from the initial purchaser(s), or the designee
thereof, shall cancel the Initial Bonds delivered hereunder and
exchange therefo r def ini t i ve Bonds of 1 i ke ser ies, of
authorized denominations, Stated Maturities, principal amounts
(wi th respect to Current Interest Bonds) or Maturi ty Amounts
(with respect to Capital Appreciation Bonds) and bearing
applicable interest rates for transfer and delivery to the
Holders named at the addresses identified therefor; all
pursuant to and in accordance wi th such wri tten instructions
from the initial purchaser(s), or the designee thereof, and
such other information and documentation as the Paying
Agent/Registrar may reasonably require.
SECTION 9: Forms. A. Forms Generally. The Bonds,
the Registration Certificate of the Comptroller of Public
Accounts of the State of Texas, the Certificate of
Registration, and the form of Assignment to be printed on each
of the Bonds, shall be substantially in the forms set forth in
this Section with such appropriate insertions, omissions,
substi tutions, and other vari at ions as are permi tted or
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required by this Ordinance and may have such letters, numbers,
or other marks of identification (including identifying numbers
and letters of the Committee on Uniform Securities
Identification Procedures of the American Bankers Association)
and such legends and endorsements (including insurance legends
on insured Bonds and any reproduction of an opinion of counsel)
thereon as may, consistently herewith, be established by the
Ci ty or determined by the officers executing such Bonds as
evidenced by their execution thereof. Any portion of the text
of any Bonds may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Bond.
The definitive Bonds and the Initial Bonds shall be
printed, lithographed, or engraved, typewritten, photocopied or
otherwise reproduced in any other similar manner, all as
determined by the officers executing such Bonds as evidenced by
their execution thereof.
B. Form of Definitive Bond.
[Current Interest Bond]
REGISTERED
$
REGISTERED
NO.
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF NORTH RICHLAND HILLS,
GENERAL OBLIGATION (1)
SERIES 19---.in.
TEXAS,
BOND,
Issue Date: Interest Rate:
February It 1992
Stated Maturity:
CUSIP NO:
Registered Owner:
Principal Amount:
DOLLARS
The Ci ty of North Richland Hi lIs (hereinafter referred
to as the "City"), a body corporate and municipal corporation
in the County of Tarrant, State of Texas, for value received,
acknowledges itself indebted to and hereby promises to pay to
(1) "Refunding" for the Series 1992 Bonds and "Improvement"
for the Series 1992-A Bonds
(2) "92" for the Series 1992 Bonds and "92-A" for the Series
1992-A Bonds
-13-
the order of the Registered Owner named above, or the
registered assigns thereof, on the Stated Maturi ty date
specified above the Principal Amount hereinabove stated (or so
much thereof as shall not have been paid upon prior redemption)
and to pay interest on the unpaid principal amount hereof from
the Issue Date at the per annum rate of interest specified
above computed on the basis of a 360-day year of twelve 3D-day
months; such interest being payable on February 15 and
August 15 in each year, commencing (1) Principal
of this Bond is payable at its Stated Maturity or redemption to
the registered owner hereof, upon presentation and surrender,
at the principal office of the Paying Agent/Registrar executing
the registration certificate appearing hereon, or its
successor. Interest is payable to the registered owner of this
Bond (or one or more Predecessor Bonds, as defined in the
Ordinance hereinafter referenced) whose name appears on the
"Security Register" maintained by the Paying Agent/Registrar at
the close of business on the "Record Date", which is the last
business day of the month next preceding each interest payment
date, and interest shall be paid by the Paying Agent/Registrar
by check sent United States Mail, first class postage prepaid,
to the address of the registered owner recorded in the Security
Register or by such other method, acceptable to the Paying
Agent/Registrar, requested by, and at the risk and expense of,
the registered owner. All payments of principal of, premium,
if any, and interest on this Bond shall be without exchange or
collection charges to the owner hereof and in any coin or
currency of the United States of America which at the time of
payment is legal tender for the payment of public and private
debts.
SERIES 1992 BONDS ONLY: This Bond is one of the series
specified in its title issued in the aggregate principal amount
of $17,799,932.25 (herein referred to as the "Bonds") for the
purpose of providing funds for the discharge and final payment
of certain outstanding obligations of the City and to pay costs
of issuance, under and in strict conformity with the
Constitution and laws of the State of Texas, including Article
717k, V.A.T.C.S., and pursuant to an Ordinance adopted by the
City Council of the City (herein referred to as the
"Ordinance"). The Bonds are issued in part as "Current
Interest Bonds", which total in principal amount $17,450,000
and pay accrued interest at stated intervals to registered
owners and in part as "Capital Appreciation Bonds", which total
in original principal amount $349,932.25 and pay no accrued
interest prior to their Stated Maturities.
(1) "August 15, 1992" for the Series 1992 Bonds and
"February 15, 1993" for the Series 1992-A Bonds
-14-
SERIES 1992-A BONDS ONLY: This Bond is one of the
series specified in its title issued in the aggregate principal
amount of $4,400,000 (herein referred to as the "Bonds") for
permanent public improvements and public purposes, to wit:
$1,400,000 for street improvements, including drainage
incidental thereto and the acquisition of land and right-of-way
therefor, and $3,000,000 for flood control/storm sewer
improvements, under and in strict conformi ty wi th the
Constitution and laws of the State of Texas and pursuant to an
Ordinance adopted by the City Council of the City (herein
referred to as the "Ordinance").
The [Current Interest]* Bonds maturing on and after
February 15, 2003, may be redeemed prior to their Stated
Maturities, at the option of the City, in whole or in part in
principal amounts of $5,000 or any integral multiple thereof
(and if within a Stated Maturity by lot by the Paying
Agent/Registrar), on February 15, 2002, or on any date
thereafter, at the redemption price of par, together with
accrued interest to the date of redemption and upon 30 days
prior wri tten notice being sent by Uni ted States Mai I, first
class postage prepaid, to the registered owners of the Bonds to
be redeemed, and subject to the terms and provisions relating
thereto contained in the Ordinance. If this Bond (or any
portion of the principal sum hereof) shall have been duly
called for redemption and notice of such redemption duly given,
then upon such redemption date this Bond (or the portion of the
principal sum hereof to be redeemed) shall become due and
payable, and interest thereon shall cease to accrue from and
after the redemption date therefor, provided moneys for the
payment of the redemption price and the interest on the
principal amount to be redeemed to the date of redemption are
held for the purpose of such payment by the Paying
Agent/Registrar.
In the event of a partial redemption of the principal
amount of this Bond, payment of the redemption price of such
principal amount shall be made to the registered owner only
upon presentation and surrender of this Bond to the Paying
Agent/Registrar at its principal office, and there shall be
issued to the registered owner hereof, without charge, a new
Bond or Bonds of like maturity and interest rate in any
authorized denominations provided by the Ordinance for the then
unredeemed balance of the principal sum hereof. If this Bond is
selected for redemption, in whole or in part, the City and the
Paying Agent/Registrar shall not be required to transfer this
Bond to an assignee of the registered owner within 45 days of
the redemption date therefor; provided, however, such
limitation on transferability shall not be applicable to an
exchange by the registered owner of the unredeemed balance
hereof in the event of its redemption in part.
*insert language in bracketts only in Series 1992 Bonds.
-15-
The Bonds are payable from the proceeds of an ad valorem
tax levied, within the limitations prescribed by law, upon all
taxable property in the City. Reference is hereby made to the
Ordinance, a copy of which is on file in the principal office
of the Paying Agent/Registrar, and to all of the provisions of
which the owner or holder of this Bond by the acceptance hereof
hereby assents, for defini tions of terms; the description of
and the nature and extent of the tax levied for the payment of
the Bonds; the terms and conditions relating to the transfer or
exchange of this Bond; the conditions upon which the Ordinance
may be amended or supplemented with or wi thout the consent of
the Holders; the rights, duties, and obI ig a t ions of the Ci ty
and the Paying Agent/Registrar; the terms and provisions upon
which this Bond may be discharged at or prior to its maturity
or redemption, and deemed to be no longer Outstanding
thereunder; and for other terms and provisions contained
therein. Capitalized terms used herein have the meanings
assigned in the Ordinance.
This Bond, subject to certain limitations contained in
the Ordinance, may be transferred on the Security Register only
upon its presentation and surrender at the principal office of
the Paying Agent/Registrar, with the Assignment hereon duly
endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Paying Agent/Registrar duly
executed by, the registered owner hereof, or his duly
authorized agent. When a transfer on the Security Register
occurs, one or more new fully registered Bonds of the same
Stated Maturi ty, of authorized denominations, bearing the same
rate of interest, and of the same aggregate principal amount
will be issued by the Paying Agent/Registrar to the designated
transferee or transferees.
The City and the Paying Agent/Registrar, and any agent
of either, shall treat the registered owner whose name appears
on the Security Register (i) on the Record Date as the owner
entitled to payment of interest hereon, (ii) on the date of
surrender of this Bond as the owner entitled to payment of
principal hereof at its Stated Maturity or its redemption, in
whole or in part, and (iii) on any other date as the owner for
all other purposes, and neither the City nor the Paying Agent/
Registrar, or any agent of either, shall be affected by notice
to the contrary. In the event of nonpayment of interest on a
scheduled payment date and for thi rty (30) days thereafter, a
new record date for such interest payment (a "Special Record
Date") wi 11 be established by the Paying Agent/Registrar, if
and when funds for the payment of such interest have been
received from the City. 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
-16-
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 Holder appearing on the Security Register at
the close of business on the last business day next preceding
the date of mailing of such notice.
It is hereby certified, recited, represented and
declared that the City is a body corporate and political
subdivision duly organized and legally existing under and by
virtue of the Constitution and laws of the State of Texas; that
the issuance of the Bonds is duly authorized by law; that all
acts, conditions and things required to exist and be done
precedent to and in the issuance of the Bonds to render the
same lawful and valid obligations of the City have been
properly done, have happened and have been performed in regular
and due time, form and manner as required by the Constitution
and laws of the State of Texas, and the Ordinance; that the
Bonds do not exceed any Constitutional or statutory limitation;
and that due provision has been made for the payment of the
principal of and interest on the Bonds by the levy of a tax as
aforestated. In case any provision in this Bond shall be
invalid, illegal, or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way
be affected or impai red thereby. The terms and provis ions of
this Bond and the Ordinance shall be construed in accordance
with and shall be governed by the laws of the State of Texas.
IN WITNESS WHEREOF, the Ci ty Counci I of the Ci ty has
caused this Bond to be duly executed under the official seal of
the City as of the Issue Date.
CITY OF NORTH RICHLAND HILLS,
TEXAS
COUNTERSIGNED:
Mayor
City Secretary
(SEAL)
-17-
[Capital Appreciation Bond]
REGISTERED
NO. CAB-
REGISTERED
MATURITY AMOUNT
$
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF NORTH RICHLAND HILLS, TEXAS,
GENERAL OBLIGATION REFUNDING BOND,
SERIES 1992
Issue Date:
February 1, 1992
Stated Yield:
'1.
Stated Maturity:
CUSIP NO:
Registered Owner:
Maturity Amount:
DOLLARS
The City of North Richland Hills (hereinafter referred
to as the "City"), a body corporate and municipal corporation
in the Counties of Tarrant, State of Texas, for value received,
acknowledges itself indebted to and hereby promises to pay to
the order of the Registered Owner named above, or the
registered assigns thereof, on the Stated Maturity date
specified above, without right of prior redemption or
prepayment, the Maturity Amount stated above. The Maturity
Amount of this Bond represents the accretion of the original
principal amount of this Bond, together with any premium paid
by the initial purchasers, from the date of delivery to the
initial purchasers (March 10, 1992) to the Stated Maturity and
such accretion in value occuring at the above Stated Yield and
compoundi ng on Augus t 15, 1992, and semi annua lly thereaf ter on
February 15 and August 15. A table of the "Accreted Values"
per $5,000 "Accreted Value" at maturity is printed on the
reverse side of this Bond. The term "Accreted Value", as used
herein, means the original principal amount of this Bond,
together with any premium paid by the initial purchasers, plus
the interest thereon compounded semiannually to February 15 and
August IS, as the case may be, next preceding the date of such
calculation (or the date of calculation, if such calculation is
made on February 15 or August 15) at the Stated Yield for the
Stated Maturity shown above and in the Table of Accreted Values
printed hereon. For any date other than February 15 or
August IS, the Accreted Value of this Bond shall be determined
by a straight line interpolation between the values for the
applicable semiannual compounding dates (based on 30-day
months).
-18-
This Bond is payable to the registered owner hereof,
upon presentation and surrender, at the principal office of the
Paying Agent/Registrar executing the registration certificate
appearing hereon, or its successor. Payment of this Bond shall
be wi thout exchange or collection charges to the owner hereof
and in any coin or currency of the Uni ted States of America
which at the time of payment is legal tender for the payment of
public and private debts.
This Bond is one of the series specified in its title
issued in the aggregate principal amount of $17,799,932.25
(herein referred to as the "Bonds") for the purpose of
providing funds for the discharge and final payment of certain
outstanding obligations of the City and to pay costs of
issuance, under and in strict conformity with the Constitution
and laws of the State of Texas, including Article 717k,
V.A.T.C.S., and pursuant to an Ordinance adopted by the City
Council of the City (herein referred to as the "Ordinance").
The Bonds are issued in part as "Current Interest Bonds", which
total in principal amount $17,450,000 and pay accrued interest
at stated intervals to registered owners and in part as
"Capital Appreciation Bonds", which total in original principal
amount $349,932.25 and pay no accrued interest prior to their
Stated Maturities.
The Bonds are payable from the proceeds of an ad valorem
tax levied, within the limitations prescribed by law, upon all
taxable property in the City. Reference is hereby made to the
Ordinance, a copy of which is on file in the principal office
of the Paying Agent/Registrar, and to all of the provisions of
which the owner or holder of this Bond by the acceptance hereof
hereby as sents, fo r def ini t ions of te rms; the desc r ipt ion of
and the nature and extent of the tax levied for the payment of
the Bonds; the terms and conditions relating to the transfer or
exchange of this Bond; the conditions upon which the Ordinance
may be amended or supplemented wi th or wi thout the consent of
the Holders; the rights, duties, and obligations of the City
and the Paying Agent/Registrar; the terms and provisions upon
which this Bond may be discharged at or prior to its maturity,
and deemed to be no longer Outstanding thereunder; and for
other terms and provisions contained therein. Capitalized
terms used herein have the meanings assigned in the Ordinance.
This Bond, subject to certain limitations contained in the
Ordinance, may be transferred on the Security Register only
upon its presentation and surrender at the principal office of
the Paying Agent/Registrar, with the Assignment hereon duly
endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Paying Agent/Registrar duly
executed by, the registered owner hereof, or his duly
-19-
authorized agent. When a transfer on the Security Register
occurs, one or more new fully registered Bonds of the same
Stated Maturity, of authorized denominations, accruing interest
at the same rate, and of the same aggregate Maturity Amount
will be issued by the Paying Agent/Registrar to the designated
transferee or transferees.
The City and the Paying Agent/Registrar, and any agent of
either, shall treat the registered owner whose name appears on
the Security Register (i) on the date of surrender of this Bond
as the owner entitled to payment of the Maturity Amount at its
Stated Maturi ty, and (i i) on any other date as the owner for
all other purposes, and neither the City nor the Paying Agent/
Registrar, or any agent of either, shall be affected by notice
to the contrary.
It is hereby certified, recited, represented and declared
that the City is a body corporate and political subdivision
duly organized and legally existing under and by virtue of the
Constitution and laws of the State of Texas; that the issuance
of the Bonds is duly authorized by law; that all acts,
condi tions and things required to exist and be done precedent
to and in the issuance of the Bonds to render the same lawful
and valid obligations of the City have been properly done, have
happened and have been performed in regular and due time, form
and manner as required by the Constitution and laws of the
State of Texas, and the Ordinance; that the Bonds do not exceed
any Constitutional or statutory limitation; and that due
provision has been made for the payment of the principal of and
interest on the Bonds by the levy of a tax as aforestated. In
case any provision in this Bond shall be invalid, illegal, or
unenforceable, the validity, legality, and enforceability of
the remaining provisions shall not in any way be affected or
impaired thereby. The terms and provisions of this Bond and
the Ordinance sha 11 be const rued in accordance wi th and sha 11
be governed by the laws of the State of Texas.
IN WITNESS WHEREOF, the City Council of the City has
caused this Bond to be duly executed under the official seal of
the City as of the Issue Date.
CITY OF NORTH RICHLAND HILLS, TEXAS
COUNTERSIGNED:
Mayor
City Secretary
(SEAL)
-20-
C. *Form of Registration Certificate of Comptroller
of Public Accounts to appear on Initial Bonds
only.
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
THE STATE OF TEXAS
(
(
(
(
REGISTER NO.
OFFICE OF THE COMPTROLLER
OF PUBLIC ACCOUNTS
I HEREBY CERTIFY that this Bond has been examined,
certified as to validi ty and approved by the Attorney General
of the State of Texas, and duly registered by the Comptroller
of Public Accounts of the State of Texas.
WITNESS my signature and seal of office this
Comptroller of Public Accounts
of the State of Texas
(SEAL)
*NOTE TO PRINTER:
Do Not Print on Definitive Bonds
D. Form of Certificate of Paying Agent/Registrar to
appear on Definitive Bonds only.
REGISTRATION CERTIFICATE OF PAYING AGENT/REGISTRAR
This Bond has been duly issued and registered under the
provisions of the within-mentioned Ordinance; the bond or bonds
of the above entitled and designated series originally
delivered having been approved by the Attorney General of the
State of Texas and registered by the Comptroller of Public
Accounts, as shown by the records of the Paying Agent/Registrar.
TEAM BANK, Fort Worth, Texas,
as Paying Agent/Registrar
Registration Date:
By
Authorized Signature
-21-
E. Form of Assignment.
ASSIGNMENT
FOR VALUE RECEIVED
assigns, and transfers unto
and zip code of transferee:)
the undersigned hereby sells,
{Print or typewrite name, address,
.... .... ........ ......... .........
........... ................ ..... ....... ............ ....... ......
........ ........ ...... ........... .... ................. ... .......
(Social Security or other identifying number: .................
.................) the within Bond and all rights thereunder,
and hereby irrevocably constitutes and appoints ...............
......... ................... ...... ....................... ... ....
attorney to
registration
premises.
transfer
thereof,
the wi thin Bond on the books kept for
with full power of substitution in the
DATED:
.....................
. ...... .........................
......... ...... ....... .... ...
NOTICE: The signature on this
assignment must correspond with
the name of the registered owner
as it appears on the face of the
within Bond in every particular.
Signature guaranteed:
F. The Ini tial Bonds for the Current Interest Bonds
and the Capital Appreciation Bonds shall be in the respective
forms set forth therefor in paragraph B of this Section, except
as follows:
(l)
[Form of Current Interest Initial Bond]
Heading and paragraph one shall be amended to read as follows:
NO. TR-l
$
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF NORTH RICHLAND HILLS,
GENERAL OBLIGATION (1)
SERIES 19 (2)
TEXAS,
BOND,
Issue Date:
February 1, 1992
CUSIP NO:
Registered Owner:
Principal Amount:
DOLLARS
(1) "Refunding" for the Series 1992 Bonds and "Improvement"
for the Series 1992-A Bonds
(2) "92" for the Series 1992 Bonds and "92-A" for the Series
1992-A Bonds
-22-
The City of North Richland Hills, Texas (hereinafter
referred to as the "City"), a body corporate and municipal
corporation in the County of Tarrant, State of Texas, for value
received, acknowledges itself indebted to and hereby promises
to pay to the order of the Registered Owner named above, or the
registered assigns thereof, the Principal Amount hereinabove
stated on February 15 in the years and in principal
installments in accordance with the following schedule:
YEAR OF
MATURITY
PRINCIPAL
INSTALLMENTS
INTEREST
RATE
(Information to be inserted from
schedule in Section 2 hereof)
(or so much thereof as shall not have been paid upon prior
redemption) and to pay interest on the unpaid principal amount
hereof from the Issue Date at the per annum rate of interest
specified above computed on the basis of a 360-day year of
twelve 30-day months; such interest being payable on
February 15 and August 15 in each year, commencing
(1) Principal installments of this Bond are payable
at the year of maturity or on a prepayment date to the
registered owner hereof, upon presentation and surrender, at
the principal office of Team Bank, Fort Worth, Texas (the
"Paying Agent/Registrar"). Interest is payable to the
registered owner of this Bond (or one or more Predecessor
Bonds, as defined in the Ordinance hereinafter referenced)
whose name appears on the "Security Register" maintained by the
Paying Agent/Registrar at the close of business on the "Record
Date", which is the last business day of the month next
preceding each interest payment date, and interest sha 11 be
paid by the Paying Agent/Registrar by check sent United States
Mail, first class postage prepaid, to the address of the
registered owner recorded in the Security Register or by such
other method, acceptable to the Paying Agent/Registrar,
requested by, and at the risk and expense of, the registered
owner. All payments of principal of, premium, if any, and
interest on this Bond shall be without exchange or collection
charges to the owner hereof and in any coin or currency of the
United States of America which at the time of payment is legal
tender for the payment of public and private debts.
(1) "August 1St 1992" for the Series 1992 Bonds and
"February 1St 1993" for the Series 1992-A Bonds
-23-
(2)
[Form of Capital Appreciation Initial Bond]
Heading and first two paragraphs shall be amended to read as
follows:
REGISTERED
NO. TCAB-l
MATURITY AMOUNT
$
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF NORTH RICHLAND HILLS, TEXAS,
GENERAL OBLIGATION REFUNDING BOND,
SERIES 1992
Issue Date:
February 1, 1992
CUSIP NO:
Registered Owner:
Maturity Amount:
DOLLARS
The City of North Richland Hills, Texas (hereinafter
referred to as the "Ci ty"), a body corporate and municipal
corporation in the County of Tarrant, State of Texas, for value
recei ved, acknowledges itself indebted to and hereby promises
to pay to the order of the Registered Owner named above, or the
registered assigns thereof, the aggregate Maturity Amount
stated above on February 15 in each of the years and in
installments in accordance with the following schedule:
Year of
Maturity
Maturity
Amount
Stated
Yield(s)
(Information to be inserted from
schedule in Section 2 hereof).
(without right of prior redemption or prepayment). The
respective installments of the Maturity Amount hereof
represents the accretion of the original principal amounts of
each year of maturi ty, together wi th any premium paid by the
initial purchasers, from the date of delivery to the initial
purchasers (March 10, 1992) to the respective years of maturity
and such accretion in values occuring at the respective Stated
Yields and compounding on August 15, 1992, and semiannually
thereafter on each February 15 and August 15. A table of the
"Accreted Values" per $5,000 "Accreted Value" at maturity is
attached to this Bond. The term "Accreted Value", as used
herein, means the original principal amount of this Bond,
together with any premium paid by the initial purchasers, plus
the interest thereon compounded semiannually to February 15 and
-24-
August 15, as the case may be, next preceding the date of such
calculation (or the date of calculation, if such calculation is
made on February 15 or August 15) at the respective Stated
Yields shown above and in the Table of Accreted Values attached
hereto. For any date other than February 15 or August 15, the
Accreted Value of this Bond shall be determined by a straight
line interpolation between the values for the applicable
semiannual compounding dates (based on 3D-day months).
The installments of Maturity Amounts of this Bond are
payable at maturi ty to the registered owner hereof, wi thout
exchange or collection charges, upon its presentation and
surrender, at the principal office of Team Bank, Fort Worth,
Texas (the "Paying Agent/ Registrar"), and shall be payable in
any coin or currency of the United States of America which at
the time of payment is legal tender for the payment of public
and private debts.
SECTION 10: Levy of Taxes. To provide for the payment
of the "Debt Service Requirements" of the Bonds, being (i) the
interest on the Bonds and (ii) a sinking fund for their
redemption at maturity or a sinking fund of 2% (whichever
amount is the greater), there is hereby levied, and there shall
be annually assessed and collected in due time, form, and
manner, a tax on a 11 taxable property in the City, wi thin the
limitations prescribed by law, and such tax hereby levied on
each one hundred dollars' valuation of taxable property in the
City for the Debt Service Requirements of the Bonds shall be at
a rate from year to year as will be ample and sufficient to
provide funds each year to pay the principal of and interest on
said Bonds while Outstanding; full allowance being made for
delinquencies and costs of collection. The taxes levied,
assessed and collected for and on account of the Series 1992
Bonds and the Series 1992-A Bonds shall be accounted for
separate and apart from all other funds of the City and the
taxes assessed and collected for the Debt Service Requirements
on the Series 1992 Bonds shall be deposited to the credit of a
"Special 1992 Refunding Bond Account" and the taxes assessed
and collected for the Debt Service Requirements on the Series
1992-A Bonds shall deposited to the credit of a "Special 1992-A
Bond Account" (collectively hereinafter referred to as the
"Interest and Sinking Funds"), which Funds shall be maintained
on the records of the City and deposited in a special fund
maintained at an officia 1 deposi tory of the City's funds; and
the tax hereby levied, and to be assessed and collected
annually, for the Series 1992 Bonds and the Series 1992-A Bonds
is hereby pledged to the payment of the respective series of
Bonds.
-25-
Proper officers of the City are hereby authorized and
directed to cause to be transferred to the Paying Agent/
Registrar for the Bonds, from funds on deposit in the Interest
and Sinking Funds, amounts sufficient to fully pay and
di scharge prompt ly each insta llment of interest and pr incipa 1
of the Series 1992 Bonds and the Series 1992-A Bonds as the
same accrues or matures or comes due by reason of redemption
prior to maturity; such transfers of funds to be made in such
manner as will cause collected funds to be deposited with the
Paying Agent/Registrar on or before each principal and interest
payment date for the Bonds.
Provided, however, in regard to the payment to become due
on the Series 1992 Bonds on August 15, 1992, sufficient current
funds will be available and are hereby appropriated to pay such
payment; and proper officials of the City are hereby authorized
and directed to transfer and deposit in the "Special 1992
Refunding Bond Account" such current funds which, together with
the accrued interest received from the purchaser, will be
sufficient to pay the amount of the payment due on the Series
1992 Bonds on August 15, 1992.
SECTION 11: Mutilated Destroyed Lost and Stolen
Bonds. In case any Bond shall be mutilated, or destroyed, lost
or stolen, the Paying Agent/Registrar may execute and deliver a
replacement Bond of like series, form and tenor, and in the
same denomination and bearing a number not contemporaneously
outstanding, in exchange and substitution for such mutilated
Bond, or in lieu of and in substitution for such destroyed,
lost or stolen Bond, only upon the approval of the Ci ty and
after (i) the filing by the Holder thereof with the Paying
Agent/Registrar of evidence satisfactory to the Paying
Agent/Registrar of the destruction, loss or theft of such Bond,
and of. the authenticity of the ownership thereof and (ii) the
furnishing to the Paying Agent/Registrar of indemnification in
an amount satisfactory to hold the City and the Paying
Agent/Registrar harmless. All expenses and charges associated
with such indemnity and with the preparation, execution and
delivery of a replacement Bond shall be borne by the Holder of
the Bond mutilated, or destroyed, lost or stolen.
Every replacement Bond issued pursuant to this Section
shall be a valid and binding obligation, and shall be entitled
to all the benefits of this Ordinance equally and ratably with
all other Outstanding Bonds; notwithstanding the enforceability
of payment by anyone of the destroyed, lost, or stolen Bonds.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies
with respect to the replacement and payment of mutilated,
destroyed, lost or stolen Bonds.
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SECTION 12: Satisfaction of Obligation of City. If the
City shall payor cause to be paid, or there shall otherwise be
paid to the Ho lders, the pr incipa I of, premium, if any, and
interest on the Bonds, at the times and in the manner
stipulated in this Ordinance, then the pledge of taxes levied
under this Ordinance and all covenants, agreements, and other
obligations of the City to the Holders shall thereupon cease,
terminate, and be discharged and satisfied.
Bonds or any principal amount(s) (with respect to Current
Interest Bonds) and Maturi ty Amounts (wi th respect to Capi ta I
Appreciation Bonds) shall be deemed to have been paid wi thin
the meaning and with the effect expressed above in this Section
when (i) money sufficient to pay in full such Bonds at maturity
or to the redemption date therefor, together with all interest
due thereon, shall have been irrevocably deposited with and
held in trust by the Paying Agent/Registrar, or an authorized
escrow agent, or (ii) Government Securities shall have been
irrevocably deposited in trust with the Paying Agent/Registrar,
or an authorized escrow agent, which Government Securities have
been certified by an independent accounting firm to mature as
to principal and interest in such amounts and at such times as
will insure the availability, without reinvestment, of
sufficient money, together with any moneys deposited therewith,
if any, to pay when due the Bonds on the Stated Maturi ties
thereof or (if notice of redemption has been duly given or
waived or if irrevocable arrangements therefor acceptable to
the Paying Agent/ Registrar have been made) the redemption date
thereof. The City covenants that no deposit of moneys or
Government Securities will be made under this Section and no
use made of any such deposit which would cause the Bonds to be
treated as "arbitrage bonds" within the meaning of Section 148
of the Internal Revenue Code of 1986, as amended, or
regulations adopted pursuant thereto.
Any moneys so deposited with the Paying Agent/ Registrar,
or an authorized escrow agent, and all income from Government
Securities held in trust by the Paying Agent/Registrar, or an
authorized escrow agent, pursuant to this Section in excess of
the amount required for the payment of the Bonds shall be
remitted to the City or deposited as directed by the City.
Furthermore, any money held by the Paying Agent/Registrar for
the payment of the Bonds and remaining unclaimed for a period
of four (4) years after the Stated Maturity, or applicable
redemption date, of the Bonds such moneys were deposi ted and
are held in trust to pay shall upon the request of the City be
remitted to the City against a written receipt therefor.
Notwithstanding the above and foregoing, any remittance of
funds from the Paying Agent/Registrar to the City shall be
subject to any applicable unclaimed property laws of the State
of Texas.
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The term "Government Securities", as used herein, means
direct obligations of the Uni ted States of America, which are
non-callable prior to the respective Stated Maturities of the
Bonds and may be United States Treasury Obligations such as the
State and Local Government Series and may be in book-entry form.
SECTION 13: Ordinance a Contract Amendments
Outstanding Bonds. This Ordinance shall consti tute a contract
with the Holders from time to time, be binding on the City, and
shall not be amended or repealed by the Ci ty whi Ie any Bond
remains Outstanding except as permi tted in this Section. The
City may, without the consent of or notice to any Holders, from
time to time and at any time, amend this Ordinance in any
manner not detrimental to the interests of the Holders,
including the curing of any ambiguity, inconsistency, or formal
defect or omission herein. In addition, the City may, with the
consent of Holders who own in aggregate 51% of the principal
amount (wi th respect to Current Interest Bonds) and Maturi ty
Amount (with respect to Capital Appreciation Bonds) of the
Bonds then Outstanding, amend, add to, or rescind any of the
provisions of this Ordinance; provided that, without the
consent of all Holders of Outstanding Bonds, no such amendment,
addition, or rescission shall (1) extend the time or times of
payment of the principal of, premium, if any, and interest on
the Bonds, reduce the principal amount or Maturi ty Amount, as
the case may be, thereof, the redemption price therefor, or the
rate of interest thereon, or in any other way modify the terms
of payment of the principal of, premium, if any, or interest on
the Bonds, (2) give any preference to any Bond over any other
Bond, or (3) reduce the aggregate principal amount or Maturity
Amount, as the case may be, of Bonds required to be held by
Holders for consent to any such amendment, addition, or
rescission.
The term "Outstanding" when used in this Ordinance wi th
respect to Bonds means, as 0 f the date of dete rmi nat ion, a 11
Bonds theretofore issued and delivered under this Ordinance,
except:
(1) those Bonds cancelled by the Paying
Agent/Registrar or delivered to the Paying Agent/
Registrar for cancellation;
(2) those Bonds deemed to be duly paid by
the City in accordance with the provisions of
Section 12 hereof; and
(3) those mutilated, destroyed, lost, or
stolen Bonds which have been replaced with Bonds
registered and delivered in lieu thereof as
provided in Section 11 hereof.
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SECTION 14:
Covenants to Maintain Tax-Exempt Status.
(a) Definitions. When used in this Section, the
following terms shall 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
Treas. Reg. § l.l48-8T{b)(I).
"Gross Proceeds" has the meaning stated in
Treas. Reg. § 1.148-8T{d).
"Investment" has the meaning stated in Treas.
Reg. § 1.148-8T{e).
"Nonpurpose Investment" means any Investment in
which Gross Proceeds of the Bonds are invested and
which is not acquired to carry out the governmental
purpose of the Bonds. Obligations acquired with
proceeds of the Bonds that are to be used to
discharge the Refunded Obligations are Nonpurpose
Investments.
"Rebatable Arbi trage" has the meaning stated in
Treas. Reg. § 1.148-2T.
"Yield of"
(I) any Investment shall be computed in
accordance with Treas. Reg. §1.148-2T, and
(2) the Bonds has the mean1ng stated in
Treas. Reg. § 1.148-3T.
(b) Not to Cause Interest to Become Taxable. The Ci ty
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 omi tted, respectively, would cause the interest on
any Bond to become includable in the gross income, as defined
in section 61 of the Code, of the owner thereof for federal
income tax purposes. Without limiting the generality of the
foregoing, unless and until the City shall have 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 Bond, the City shall
comply with each of the specific covenants in this Section.
-29-
(c) No Private Use or Private Payments. Except as
permitted by section 141 of the Code and the regulations and
rul ings thereunder, the Ci ty sha II, at all times pr ior to the
last Stated Maturity of Bonds,
(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 Bonds
(including property financed wi th Gross Proceeds of
the Refunded Obligations) and not use or permi t the
use of such Gross Proceeds or any property acquired,
constructed, or improved with such Gross Proceeds
(including all contractual arrangements with terms
different than those applicable to the general
public) 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 Bonds or any property the acquisition,
construction, or improvement of which is to be
financed directly or indirectly with such Gross
Proceeds (including property financed with Gross
Proceeds of the Refunded Obligations), other than
taxes of general application within the City or
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
thereunder, the City shall not use Gross Proceeds of the Bonds
to make or finance loans to any person or enti ty other than a
state or local government. For purposes of the foregoing
covenant, such Gross Proceeds are considered to be "loaned" to a
person or entity if (1) property acquired, constructed, or
improved wi th such Gross Proceeds is sold or leased to such
person or enti ty in a transaction which creates a debt for
federal income tax purposes, (2) capacity in or service from
such property is commi tted to such person or enti ty 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 any property acquired, constructed, or
improved with such Gross Proceeds are otherwise transferred in a
transaction which is the economic equivalent of a loan.
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(e) Not to Invest at Higher Yield. Except to the extent
permitted by section 148 of the Code and the regulations and
rulings thereunder, the City shall not, at any time prior to the
final Stated Maturity of the Bonds, directly or indirectly
invest Gross Proceeds of the Bonds 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 of the Bonds.
(f) Not Federally Guaranteed. Except to the extent
permitted by section l49(b) of the Code and the regulations and
rulings thereunder, the City shall not take or omit to take any
action which would cause the Bonds to be federally guaranteed
within the meaning of Section l49(b) of the Code and the
regulations and rulings thereunder.
(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 Bonds on such
form and in such place as such Secretary may prescribe.
(h) Payment of Rebatable Arbitrage. Except to the extent
otherwise provided in section l48(f) of the Code and the
regulations and rulings thereunder,
(1) The City shall account for all Gross
Proceeds of the Bonds (inc luding all recei pts,
expendi tures, and investments thereof) on its books
of account separately and apart from all other funds
(and receipts, expenditures, and investments thereof)
and shall maintain all records of such accounting
with the official transcript of the proceedings
relating to the issuance of the Bonds until six years
after the final Computation Date. The City may,
however, to the extent permitted by section 148(f) of
the Code and the regulations thereunder, commingle
Gross Proceeds of the Bonds wi th other money of the
City, provided that the City separately accounts for
each receipt and expendi ture of such Gross Proceeds
and the obligations acquired therewith.
(2) Not less frequently than each Computation
Date, the City shall either (i) cause to be
calculated by a nationally recognized accounting or
financial advisory firm or (ii) calculate and cause
its calculations to be verified by a nationally
recognized accounting or financial advisory firm, in
ei ther case in accordance with rules set forth in
section l48(f) of the Code and Treas. Reg. § 1.148-2T
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and rulings thereunder, the Rebatable Arbitrage with
respect to the Bonds. The Ci ty shall maintain such
calculations relating to the Bonds until six years
after the final Computation Date.
(3) As additional consideration for the
purchase of the Bonds by the initial purchasers
thereof and the loan of the money represented
thereby, and in order to induce such purchase by
measures designed to result in the excludability of
the interest thereon from the gross income of the
owners thereof for federal income tax purposes, the
City shall pay to the United States the amount
described in paragraph (2) above and the amount
described in paragraph (4) below, 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
Treas. Reg. §§ 1.148-1 T through 1.14 8-9T and rul ings
thereunder.
(4) The Ci ty sha 11 exerc i se 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
thereafter, including payment to the United States of
any Correction Amount as described in Treas.
Reg. § 1.148-1T(c)(2) and any penalty under Treas.
Reg. § 1.148-1T(c)(3)(ii)(B).
(i) Qualified Advance Refunding. The Series 1992 Bonds
are being issued exclusively to refund the Refunded
Obligations, and the Series 1992 Bonds will be issued more than
90 days before the redemption of the Refunded Obligations. The
City represents that:
(1) None. of the Refunded Obligations are
"private activity bonds," within the meaning of
section 141 of the Code. Specifically, the covenants
set forth in subsection (c) and (d) of this Section
are true, correct, and complete with respect to the
Refunded Obligations, their proceeds, and the
facilities financed therewith.
(2) The Series 1992 Bonds are the first advance
refunding of the Series 1986, Series 1987 and Series
1989 Refunded Obligations and the second advance
refunding of the Series 1985 Refunded Obligations
(within the meaning of section 149(d)(5) of the Code).
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(3) The Refunded Obligations are being called
for redemption, and will be redeemed, not later than
the earliest date on which each such issue may b~
redeemed at par or at a premium of 3 percent or less.
(4) The ini tia I temporary period under section
l48(c) of the Code will end (i) with respect to th~
proceeds of the Series 1992 Bonds not later than 3()
days after the date of issue of such Series 199~
Bonds and (ii) with respect to proceeds of th~
Refunded Obligations on the date of issuance of th~
Series 1992 Bonds if not ended prior thereto.
(5) Section l48(e) of the Code did not apply tQ
the Refunded ObI igations. On and after the date of
issue of the Series 1992 Bonds no proceeds of th~
Refunded Obligations will be invested in Nonpurpos~
Investments having a Yield in excess of the Yield on
the Refunded Obligations to which any of such
proceeds relate.
(6) The debt service savings achieved by th~
City are a result solely of the interest rates on th~
Series 1992 Bonds being lower than the interest rate~
of the Refunded Obligations. In the issuance of thE:!
Series 1992 Bonds the City has employed no "device"
to obtain a material financial advantage (based on
arbitrage), within the meaning of section 149(d)(4)
of the Code, apart from savings attributable to lower
interest rates.
SECTION 15: Sale of Bonds - Official Statement Approval.
The Bonds authorized by this Ordinance have been and are hereby
sold by the City to Prudential Securities Incorporated (herein
referred to as the "Purchasers") in accordance wi th the Bond
Purchase Agreement, dated February 10, 1992, attached her~to as
Exhibi t A and incorporated herein by reference as a part of
this Ordinance for all purposes. The Mayor is hereby
authorized and directed to execute said Bond Purchase Agreement
for and on behalf of the City and as the act and deed of this
Council, and the City Secretary is authorized to attest said
Bond Purchase Agreement, in regard to the approval and
execution of the Bond Purchase Agreement, the Council hereby
finds, determines and declares that the representations,
warranties and agreements of the Ci ty contained therein are
true and correct in all material respects and shall be hQnored
and performed by the City.
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Furthermore, the use of the Preliminary Official Statement
in connection with the public offering and sale of the Bonds is
hereby ratified, confirmed and approved in all respects. The
final Official Statement reflecting the terms of sale, attached
as Exhibit A to the Bond Purchase Agreement (together with such
changes approved by the Mayor, City Manager, City Secretary, or
Director of Finance, anyone or more of said officials), shall
be and is hereby in all respects approved and the Purchasers
are hereby authorized to use and distribute said final Official
Statement, dated February 10, 1992, in the reoffering, sale and
delivery of the Bonds to the public. The Mayor and City
Secretary are further authorized and directed to manually
execute and deliver for and on behalf of the Ci ty copies of
said Official Statement in final form as may be required by the
Purchasers, and such Official Statement in the final form and
content manually executed by said officials shall be deemed to
be approved by the City Council and constitute the Official
Statement authorized for distribution and use by the Purchasers.
SECTION 16: Special Escrow Agreement Approval and
Execution. The "Special Escrow Agreement" (the "Agreement") by
and between the Ci ty and Team Bank, Fort Worth, Texas (the
"Escrow Agent"), attached hereto as Exhibi t B and incorporated
herein by reference as a part of this Ordinance for all
purposes, is hereby approved as to form and content, and such
Agreement in substantially the form and substance attached
hereto, together with such changes or revisions as may be
necessary to accomplish the refunding or benefit the City, is
hereby authorized to be executed by the Mayor and City
Secretary for and on behalf of the City and as the act and deed
of the City Council; and such Agreement as executed by said
officials shall be deemed approved by the City Council and
constitute the Agreement herein approved.
Furthermore, the Ci ty Manager, Di rector of Finance, and
Assistant City Manager, anyone or more of said officials, in
cooperation wi th the Escrow Agent are hereby authorized and
directed to make the necessary arrangements for the purchase of
the Federal Securities referenced in the Agreement and the
delivery thereof to the Escrow Agent on the day of delivery of
the Series 1992 Bonds to the Purchasers for deposit to the
credit of the "SPECIAL CITY OF NORTH RICHLAND HILLS, TEXAS,
REFUNDING BOND ESCROW FUND" (the "Escrow Fund"), including the
execution of the subscription forms for the purchase and
issuance of the "United States Treasury Securities - State and
Local Government Series"; all as contemplated and provided in
Article 717k, V.A.T.C.S., as amended, this Ordinance and the
Agreement.
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SECTION 17: Control and Custody of Bonds. The Mayor of
the City shall be and is hereby authorized to take and have
charge of all necessary orders and records pending
investigation by the Attorney General of the State of Texas,
including the printing and supply of definitive Bonds, and
shall take and have charge and control of the Initial Bonds
pending the approval thereof by the Attorney General, the
registration thereof by the Comptroller of Public Accounts and
the delivery thereof to the Purchasers.
Furthermore, the Mayor, City Secretary, City Manager,
Director of Finance, and Assistant City Manager, anyone or
more of said officials, are hereby authorized and directed to
furnish and execute such documents and certifications relating
to the Ci ty and the issuance of the Bonds, including
certifications as to facts, estimates, circumstances and
reasonable expectations pertaining to the use, expenditure and
investment of the proceeds of the Bonds, as may be necessary
for the approval of the Attorney General, the registration by
the Comptroller of PUblic Accounts and the delivery of the
Bonds to the Purchasers, and, together wi th the Ci ty' s
financial advisor, bond counsel and the Paying Agent/Registrar,
make the necessary arrangements for the delivery of the Initial
Bonds to the Purchasers and the initial exchange thereof for
definitive Bonds.
SECTION 18: Proceeds of Sale. Immediately following
the delivery of the Series 1992 Bonds, the proceeds of sale
(less certain costs of issuance and the accrued interest
recei ved f rom the Purchaser of the Bonds) sha 11 be depos i ted
with the Escrow Agent for application and disbursement in
accordance with the provisions of the Agreement and in
accordance wi th wri tten instructions to the Escrow Agent from
the Director of Finance.
The proceeds of sale of the Series 1992-A Bonds, excluding
the accrued interest, received from the Purchasers, shall be
deposited in a construction fund maintained at the City's
depository bank. Pending expenditure for authorized projects
and purposes, such proceeds of sale may be invested in
authorized investments and, subject to the provisions of
Section 14(h) hereof, any investment earnings realized shall be
expended for such authorized projects and purposes or deposited
in the Series 1992-A Bond Account as shall be determined by the
City Council. All surplus proceeds of sale of the Series
1992-A Bonds, including investment earnings, remaining after
completion of all authorized projects or purposes and paying or
making provision for the payment of the amounts owed pursuant
to Section 14(h)(2) hereof, shall be deposited to the credit of
the Series 1992-A Bond Account.
-35-
SECTION 19: Notices to Holders - Waiver. Wherever this
Ordinance provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein
expressly provided) if in wri ting and sent by Uni ted States
Mail, first class postage prepaid, to the address of each
Holder appearing in the Security Register at the close of
business on the business day next preceding the mailing of such
notice.
In any case where notice to Holders is given by mai 1,
neither the failure to mail such notice to any particular
Holders, nor any defect in any notice so mailed, shall affect
the sufficiency of such notice with respect to all other
Bonds. Where this Ordinance provides for notice in any manner,
such notice may be waived in writing by the Holder entitled
to receive such notice, ei ther before or after the event wi th
respect to which such notice is given, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Paying Agent/Registrar, but such filing
shall not be a condition precedent to the validity of any
action taken in reliance upon such waiver.
SECTION 20: Cancellation. All Bonds surrendered for
payment, redemption, transfer, exchange, or replacement, if
surrendered to the Paying Agent/Registrar, shall be promptly
cancelled by it and, if surrendered to the City, shall be
delivered to the Paying Agent/Registrar and, if not already
cancelled, shall be promptly cancelled by the Paying Agent/
Registrar. The City may at any time deliver to the Paying
Agent/Registrar for cancellation any Bonds previously certified
or registered and delivered which the City may have acquired in
any manner whatsoever, and all Bonds so delivered shall be
promptly cancelled by the Paying Agent/Registrar. All
cancelled Bonds held by the Paying Agent/Registrar shall be
returned to the City.
SECTION 21: Printed Opinion. The Purchasers'
obligation to accept delivery of the Bonds is subject to being
furnished a final opinion of Fulbright & Jaworksi, Dallas,
Texas, approving the Bonds as to their validity, said opinion
to be dated and delivered as of the date of delivery and
payment for the Bonds. Printing of a true and correct
reproduction of said opinion on the reverse side of each of the
definitive Bonds is hereby approved and authorized.
SECTION 22: CUSIP Numbers. CUSIP numbers may be
printed or typed on the definitive Bonds. It is expressly
provided, however, that the presence or absence of CUSIP
numbers on the definitive Bonds shall be of no significance or
effect as regards the legality thereof and neither the City nor
-36-
attorneys approving the Bonds as to legality are to be held
responsible for CUSIP numbers incorrectly printed or typed on
the definitive Bonds.
SECTION 23: Benefits of Ordinance. Nothing in this
Ordinance, expressed or implied, is intended or shall be
construed to confer upon any person other than the Ci ty, the
Paying Agent/Registrar and the Holders, any right, remedy, or
claim, legal or equitable, under or by reason of this Ordinance
or any provision hereof, this Ordinance and all its provisions
being intended to be and being for the sole and exclusive
benefit of the City, the Paying Agent/Registrar and the Holders.
SECTION 24: Inconsistent Provisions. All ordinances,
orders or resolutions, or parts thereof, which are in conflict
or inconsistent with any provision of this Ordinance are hereby
repealed to the extent of such conflict, and the provisions of
this Ordinance shall be and remain controlling as to the
matters contained herein.
SECTION 25: Governing Law. This Ordinance shall be
construed and enforced in accordance with the laws of the State
of Texas and the United States of America.
SECTION 26: Effect of Headings.
herein are for convenience only and
construction hereof.
The
shall
Section headings
not affect the
SECTION 27: Construction of Terms. If appropriate in
the context of this Ordinance, words of the singular number
shall be considered to include the plural, words of the plural
number shall be considered to include the singular, and words
of the masculine, feminine or neuter gender shall be considered
to include the other genders.
SECTION 28: Severability. If any provision of this
Ordinance or the application thereof to any circumstance shall
be held to be invalid, the remainder of this Ordinance and the
application thereof to other circumstances shall nevertheless
be valid, and the City Council hereby declares that this
Ordinance would have been enacted without such invalid
provision.
SECTION 29: Incorporation of Findings and Determinations.
The findings and determinat ions of the Ci ty Counci I conta ined
in the preamble hereof are hereby incorporated by reference and
made a part of this Ordinance for all purposes as if the same
were restated in full in this Section.
-37-
SECTION 30: Public Meeting. It is officially found,
determined, and declared that the meeting at which this
Ordinance is adopted was open to the public and public notice
of the time, place, and subject matter of the public business
to be considered at such meeting, including this Ordinance, was
given, all as required by Article 6252-17, Vernon's Texas Civil
Statutes, as amended.
SECTION 31: Effective Date. This Ordinance shall be in
full force and effect from and after its passage on the date
shown below and it is so ordained.
PASSED AND ADOPTED, this February 10, 1992.
CITY OF NORTH RICHLAND
HILLS, TEXAS
,-b
Mayor
ATTEST:
(};~~g£;~
?f=y Secretary
APPROVED AS TO LEGALITY:
{ Af o~
(City Seal)
6 1 08 s
-38-
$17,799,932.25
City of North Riclùand Hills, Texas
General Obligation Refunding Bonds
Series 1992
$4,400,000
City of North Riclùand Hills, Texas
General Obligation Improvement Bonds
Series 1992-A
BOND PURCHASE AGREEMENT
February 10, 1992
THE HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
City of North Riclùand Hills, Texas
7301 North East Loop 820
North Riclùand Hills, Texas 76182
Dear Mayor and Members of the City Council:
The undersigned, Prudential Securities Incorporated (the "Underwriter"), offers to enter
into this Bond Purchase Agreement with the City of North Riclùand Hills, Texas (the
"Issuer") which, upon the Issuer's written acceptance of this offer, will be binding upon the
Issuer and upon the Underwriter. This offer is made subject to the Issuer's written acceptance
hereof on or before 9:00 p.m. Central Standard time on the date hereof, and if not so accepted,
will be subject to withdrawal by the Underwriter upon notice delivered to the Issuer at any
time prior to the acceptance hereof by the Issuer.
1. purchase and Sale of the Bonds. Subject to the tenns and conditions and in
reliance upon the representations, warranties and agreements set forth herein, the Underwriter
hereby agrees to purchase from the Issuer, and the Issuer hereby agrees to sell and deliver to
the Underwriter, all, but not less than all, of the Issuer's $17,799,932.25 principal amount of
City of North Riclùand Hills, Texas General Obligation Refunding Bonds, Series 1992 (the
"Series 1992 Bonds") and $4,400,000 principal amount of City of North Riclùand Hills, Texas
General Obligation Improvement Bonds, Series 1992-A (the "Series 1992-A Bonds") (the
Series 1992 Bonds and Series 1992-A Bonds referred to herein collectively as the "Bonds").
The principal amount of the Bonds to be issued, the dated date thereof, the maturities and
optional redemption provisions, and interest rates per 8IU1um are set forth in, and the Bonds
shall otherwise have such tenns and provisions as set forth in the Official Statement (as
hereinafter deÍmed).
The purchase price for the Bonds shall be $23,715,008.79, representing the par amount
of the Bonds of $22,199,932.25, plus a premium of $1,640,249.20 on the Premium Capital
Appreciation Bonds, less an underwriter's discount of $155,855.52, less an original issue
discount of $104,300.20, plus interest accrued on the Bonds, other than the Premium Capital
Appreciation Bonds, from their date to the date of payment for and delivery of the Bonds.
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The Underwriter has delivered to the Issuer a corporate check of the Underwriter
payable to the order of the Issuer in the amount of $230,999.32. The Issuer agrees to hold
such check uncashed until the Closing to ensure the perfonnance by the Underwriter of its
obligations to purchase, accept delivery of and pay for the Bonds at Closing. Concurrently
with the payment by the Underwriter of the purchase price of the Bonds, the Issuer shall
return such check to the Underwriter as provided in Paragraph 6 hereof. Should the Issuer fail
to deliver the Bonds at the Cosing, or should the Issuer be unable to satisfy the conditions of
the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds, as set
forth in this Bond Purchase Agreement (1inless waived by the Underwriter), or should such
obligations of the Underwriter be tenninated for any reason pennitted by this Bond Purchase
Agreement, such check shall immediately be returned to the Underwriter. In the event the
Underwriter fails (other than for a reason pennitted hereunder) to purchase, accept delivery of
and pay for the Bonds at the Closing as herein provided, such check shall be retained by the
Issuer as and for full liquidated damages for such failure of the Underwriter and for any
defaults hereunder on the part of the Underwriter. The Underwriter hereby agrees not to stop,
or cause payment on said check to be stopped, unless the Issuer has breached any of the tenns
of this Bond Purchase Agreement.
The Preliminary Official Statement of the Issuer, dated January _, 1992, including the
cover page and Appendices thereto, relating to the Bonds (the "Preliminary Official
Statement"), with such changes and amendments to the date hereof as have been mutually
agreed to by the Issuer and the Underwriter, is attached as Exhibit A hereto, and is hereinafter
called the "Official Statement."
2. The Bonds and the Official Statement; F.1]d of the Underwritin¡ Period.
(a) The Bonds shall be as described in, and shall be issued and secured under and
fursuant to the provisions of, an ordinance to be adopted by the City Council (the
'Council") of the Issuer on February 10, 1992, as amended and supplemented (the
"Ordinance").
(b) Prior to or concurrently with the acceptance hereof by the Issuer, the
Issuer has delivered to the Underwriter:
(i) one certified copy of the Ordinance authorizing the issuance and
sale of the Bonds; and
(ü) two copies of the Official Statement manually signed on behalf of
the Issuer by the Mayor.
(c) The Issuer hereby represents and warrants that the Official Statement
delivered to the Underwriter immediately prior to or concurrently herewith is deemed
fmal by the Issuer as of the date hereof, except for the omission of such infonnation
which is dependent upon the final pricing of the Bonds for completion, all as pennitted
to be excluded by Rule 15c2·12 under the Securities Exchange Act of 1934, as amended
("Rule 15c2-12").
(d) Unless otherwise notified in writing by the Underwriter by the Closing
Date (defmed herein), the Issuer can assume that the "end of the underwriting period"
for purposes of Rule 15c2-12 shall be the Closing Date. In the event'such notice is so
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given in writing by the Underwriter, the Underwriter agrees to notify the Issuer in
writing following the occurrence of the "end of the underwriting period" as defmed in
Rule 15c2-12. The "end of the underwriting period" as used in this Bond Purchase
Agreement shall mean the Closing Date or such later date as to which notice is given by
the Underwriter in accordance with the preceding sentence.
3. PubJic Offert'1i. It shall be a condition to the Issuer's obligations to sell and
deliver the Bonds to the Underwriter and to the Underwriter's obligations to purchase, to
accept delivery of and to pay for the Bonds that the entire principal amount of the Bonds
authorized by the Ordinance shall be issued, sold and delivered by the Issuer and purchased,
accepted and paid for by the Underwriter at the Closing. The Underwriter agrees to make a
bona fide public offering of the Bonds at prices not in excess of the initial offering prices or
yields set forth on the cover page of the Official Statement and in Schedule 1 attached hereto,
plus interest accrued thereon, except for the Premium Capital Appreciation Bonds, from the
date of the Bonds.
4. Use of J}ocl11nents; Cert~it1 Covenants and A¡reements of the Issuer. (a)
The Issuer hereby authorizes the use by the Underwriter of the Ordinance and the
Official Statement, including any supplements or amendments thereto, and the
infonnation therein contained, in connection with the public offering and sale of the
Bonds. The Issuer ratifies and confmns the use by the Underwriter prior to the date
hereof of the Preliminary Official Statement, which the Issuer confmns is "deemed
fmal" as of the date of initial mailing, within the meaning of and for the pwposes of
Rule 15c2-12 in connection with the public offering of the Bonds.
(b) The Issuer covenants and agrees:
(i) To cause reasonable quantities of the Official Statement, as
requested by the Underwriter, to be delivered to the Underwriter, without
charge, within seven business days of the date hereof;
(ii) To apply the proceeds from the sale of the Bonds as provided in
and subject to all of the tennsand provisions of the Ordinance and not to take or
omit to take any action which action or omission will adversely affect the
exclusion from gross income for federal income tax pwposes of the interest on
the Bonds;
(iii) If, after the date of this Bond Purchase Agreement and until
twenty-five (25) days after the end of the underwriting period, any event shall
occur, or circumstances shall exist, or such occurrence or existence shall become
known, which might or would cause the Official Statement to contain any untrue
statement of a material fact or to omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or as a result of
which it is necessary to amend or supplement the Official Statement in order to
make the statements made therein, in the light of the circumstances when the
Official Statement is delivered to a purchaser, not misleading, or if it is
necessary to amend or supplement the Official Statement to comply with law, to
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13820016:2
notify the Underwriter (and for the purpose of this clause (iii) to provide the
Underwriter with such infonnation as it may from time to time request), and to
amend or supplement the Official Statement so that the statements in the
Official Statement, as so amended and supplemented, will not, in the light of
the circwnstances when the Official Statement is delivered to a purchaser, be
misleading or so that the Official Statement will comply with law;
(iv) To furnish such infonnation and execute such instruments and
take such action in cooperation with the Underwriter as the Underwriter may
reasonably request (A) to qualify the Bonds for offer and sale under the Blue
Sky or other securities laws and regulations of such states and other jurisdictions
in the United States as the Underwriter may designate, and to detennine the
eligibility of the Bonds for investment under the laws of such states and other
jurisdictions and (B) to continue such qualifications in effect so long as required
for the distribution of the Bonds; provided, however, that the Issuer will not be
required to qualify as a foreign corporation or to me any general or special
consents to service of process under the laws of any state;
(v) To advise the Underwriter immediately of receipt by the Issuer of
any notification with respect to the suspension of the qualification of the Bonds
for sale in any jurisdiction or the initiation or threat of any proceeding for that
purpose; and
(vi) Prior to Closing not to offer or issue any bonds, notes or other
obligations for borrowed money or incur any material liabilities, direct or
contingent, payable from or secured by a pledge of the revenues or other assets
of the Issuer other than the Issuer's Tax and Waterworks and Sewer System
(Limited Pledge) Revenue Certificates of Obligation, Series 1992.
5. Representations and Warranties of the Issuer. The Issuer represents and
warrants to the Underwriter, which representations and warranties shall survive the purchase
and offering of the Bonds, as follows:
(a) The Issuer is a home-rule municipality, a political subdivision of the
State of Texas, a body politic and corporate, and has full legal right, power and
authority, and at the date of the Closing will have full legal right, power and authority,
(i) to enter into this Bond Purchase Agreement and the Special Escrow Agreement
between the Issuer and the Escrow Agent named in the Official Statement (the "Escrow
Agreement"), and to adopt the Ordinance, (ii) to sell, issue and deliver the Bonds to the
Underwriter as provided herein and (iii) to carry out and consummate the transactions
contemplated by this Bond Purchase Agreement, the Ordinance, the Escrow Agreement
and the Official Statement, and the Issuer has complied, and will at the Closing be in
compliance in all respects, with the tenns of relevant law and the Ordinance as they
pertain to such transactions;
(b) By all necessary official action of the Issuer prior to or concurrently with
the acceptance hereof, the Issuer has duly adopted the Ordinance, has duly authorized
and approved the execution and delivery of, and the perfonnance by the Issuer of the
obligations on its part contained in the Bonds, the Ordinance, the EsCrow Agreement,
this Bond Purchase Agreement, and the consummation by it of all other transactions
contemplated by the Official Statement, the Ordinance and this Bond Purchase
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Agreement; the Ordinance, the Escrow Agreement and this Bond Purchase Agreement
constitute legal, valid and binding obligations of the Issuer, enforceable in accordance
with their respective tenns, subject to bankruptcy, insolvency, reorganization,
moratorium and other similar laws and principles of equity relating to or affecting the
enforcement of creditor's rights; the Bonds, when issued, authenticated and delivered to
the Underwriter in accordance with the Ordinance and this Bond Purchase Agreement,
will be payable from an ad valorem tax, within legal limits as set forth in the Official
Statement, against taxable property within the City, and will be entitled to the benefits
of the Ordinance and enforceable in accordance with their tenns, subject to bankruptcy,
insolvency, reorganization, moratorium and other similar laws and principles of equity
relating to or affecting the enforcement of creditor's rights;
(c) The Issuer is not in breach of or default under any applicable
constitutional provision, law or administrative regulation of the State of Texas or the
United States or any applicable judgment or decree or any loan agreement, indenture,
bond, note, ordinance, resolution, agreement or other instrument to which the Issuer is a
party or to which the Issuer or any of its property or assets are otherwise subject, and no
event has occurred and is continuing which constitutes or with the passage of time or
the giving of notice, or both, would constitute a default or event of default by the Issuer
under any such instrument; and the execution and delivery of the Bonds, this Bond
Purchase Agreement and the Escrow Agreement and the adoption of the Ordinance by
the Issuer and compliance with the provisions on the Issuer's part contained therein will
not conflict with or constitute a breach of or default under any constitutional provision,
law, administrative regulation, judgment, decree, loan agreement or other instrument to
which the Issuer is a party or to which the Issuer or any of its property or assets are
otherwise subject nor will any such execution, delivery, adoption, or compliance result
. in the creation or imposition of any lien, charge, or other security interest or
encumbrance of any nature whatsoever upon any of the property or assets of the Issuer
or under the tenns of any such constitutional provision, law, regulation or instrument,
except as provided by the Bonds and the.Ordinance;
(d) All authorizations, approvals, licenses, pennits, consents and orders of
any governmental authority, legislative body, board, agency or commission having
jurisdiction of the matter which are required for the due authorization of, which would
constitute a condition precedent to, or the absence of which would materially adversely
affect the due perfonnance by the Issuer of its obligations under, this Bond Purchase
Agreement, the Ordinance, the Bonds and the Escrow Agreement have been duly
obtained, except for the approval of the Bonds by the Attorney General of the State of
Texas (and the registration of the Bonds by the Comptroller of Public Accounts of the
State of Texas) and such approvals, consents and orders as are stated in the Official
Statement as yet to be obtained or as may be required under the Blue Sky or securities
laws of any state in connection with the offering and sale of the Bonds;
(e) The descriptions contained in the Official Statement of the Bonds, the
Escrow Agreement and the Ordinance accurately reflect the provisions of such
instruments and agreement, and the proceeds of the sale of the Bonds will be applied
generally as described in the Official Statement under the caption "Plan of Financing -
Sources and Applications of Funds";
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(f) There is no action, suit, proceeding, inquiry or investigation, at law or in
equity, before or by any court, governmental agency, public board or body, pending or,
to the best knowledge of the Issuer, after due inquiry, threatened against the Issuer,
affecting the corporate existence of the Issuer or the titles of its officers to their
respective offices, or affecting or seeking to prohibit, restrain or enjoin the sale,
issuance or delivery of the Bonds or in any way contesting or affecting the issuance,
execution, delivery, payment, security, validity or enforceability of the Bonds, the
Ordinance, or this Bond Purchase Agreement, or contesting the exclusion from gross
income of interest on the Bonds for federal income tax purposes, or contesting in any
way the completeness or accuracy of the Preliminary Official Statement or the Official
Statement or any supplement or amendment thereto, or contesting the powers of the
Issuer or any authority for the issuance of the Bonds, the adoption of the Ordinance or
the execution and delivery of this Bond Purchase Agreement or the Escrow Agreement,
nor, to the best knowledge of the Issuer, is there any basis therefor, wherein an
unfavorable decision, ruling or rmding would materially adversely affect the validity or
enforceability of the Bonds, the Ordinance, this Bond Purchase Agreement or the
Escrow Agreement;
(g) As of the date thereof, the Preliminary Official Statement did not contain
any untrue statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; at the time of the Issuer's
acceptance hereof and as of the Closing, the Official Statement does not and will not
contain any untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(h) At the time of the Issuer's acceptance hereof and (unless an event or
circumstance occurs or becomes known of the nature described in clause (ill) of
paragraph (b) of Section 4) at all times subsequent thereto during the period up to and
including twenty-five (25) days subsequent to the end of the underwriting period, the
Official Statement does not and will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made, not
misleading;
(i) If the Official Statement is supplemented or amended pursuant to clause
(ili) of paragraph (b) of Section 4, at the time of each supplement or amendment thereto
and (unless subsequently again supplemented or amended pursuant to such paragraph)
at all times subsequent thereto during the period up to and including twenty-five (25)
days subsequent to the end of the underwriting period, the Official Statement as so
supplemented or amended will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made, not
misleading;
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(j) The fmancial statements of, and other fmancial infonnation regarding,
the Issuer in the Official Statement present fairly the fmancial position of the Issuer as
of the dates and for the period covered thereby and are stated on a basis substantially
consistent with that of the Issuer's prior year's audited fmancial statements; and
(k) Between the date of this Bond Purchase Agreement and the Closing, the
Issuer will not issue any additional bonds, notes or other obligations for borrowed
money payable in whole or in pan from ad valorem taxes (other than the Issuer's Tax
and Waterworks and Sewer System (Limited Pledge) Revenue Certificates of
Obligation, Series 1992), and the Issuer will not incur any material liabilities, direct or
contingent, nor will there be any adverse change of a material nature in the fmancial
position of the Issuer.
6. Closini. At 9:00 a.m., Central Standard time, on March 10, 1992, or at such
other time and date as shall have been mutually agreed upon by the Issuer and the Underwriter
(the "Closing" or the "Closing Date"), the Issuer will, subject to the tenns and conditions
hereof, deliver the Bonds to the Underwriter duly executed and authenticated in the fonn and
manner contemplated below, together with the other documents hereinafter mentioned, and
the Underwriter will, subject to the tenns and conditions hereof, accept such delivery and pay
the purchase price of the Bonds as set forth in Section I hereof in immediately available
funds. The Issuer will deliver the initial bond or bonds (as defmed in the Ordinance) to the
Underwriter and, provided the Underwriter shall have made arrangements with The
Depository Trost Company ("DTC") for the Bonds to be immobilized and thereafter traded as
book-entry-oIÙY secunties, the Issuer shall take appropriate steps to provide DTC with one
definitive bond for each year of maturity of the Bonds, the Issuer shall make available to the
Underwriter the other documents hereinafter mentioned and the Underwriter will accept such
delivery and pay the purchase price of the Bonds as set forth in Section I hereof in
immediately available funds. Concurrently with such payment by the Underwriter, the Issuer
shall return to the Underwriter the deposit check referred to in Section I hereof. Payment for
the Bonds as aforesaid shall be made at the offices of the Paying Agent/Registrar named in the
Official Statement, or such other place as shall have been mutually agreed upon by the Issuer
and the Underwriter.
7. Closin¡ Conditions. The Underwriter has entered into this Bond Purchase
Agreement in reliance upon the representations, warranties, covenants and agreements of the
Issuer contained herein and in reliance upon the representations, warranties and agreements to
be contained in the documents and instruments to be delivered at the Closing, and upon the
perfonnance by the Issuer of its obligations hereunder, both as of the date hereof and as of the
date of Closing. Accordingly, the Underwriter's obligations under this Bond Purchase
Agreement to purchase, to accept delivery of, and to pay for the Bonds shall be conditioned
upon the perfonnance by the Issuer of its obligations to be perfonned hereunder and under
such documents and instruments at or prior to the Closing, and shall also be subject to the
following additional conditions:
(a) The representations and warranties of the Issuer contained herein shall be
true, complete and correct, and the Issuer shall have complied with the covenants and
agreements of the Issuer contained herein, on the date hereof and on and as of the date
of Closing, as if made on the date of Qosing; .
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(b) At the time of the Cosing, the Ordinance and the Escrow Agreement
shall be in full force and effect and shall not have been amended, modified or
supplemented and the Official Statement shall not have been amended, modified or
supplemented, except in any such case as may have been agreed to by the Underwriter;
(c) At the time of the Closing, all official action of the Issuer relating to this
Bond Purchase Agreement, the Bonds, the Ordinance and the Escrow Agreement shall
be in full force and effect and shall not have been amended, modified or supplemented
and the Underwriter shall have received, in appropriate fonn, evidence thereof;
(d) At the time of the Closing, there shall not have occurred any change in
the condition, fmancial or otherwise, from that set forth in the Official Statement that,
in the judgmènt of the Underwriter, is material and adverse and that makes it, in the
judgment of the Underwriter, impracticable to market the Bonds on the tenns and in the
manner contemplated in the Official Statement;
(e) The Issuer will purchase, or cause to be purchased, the Federal Securities
(as deÍmed in the Official Statement) as may be necessary to effect the refunding of the
Issuer's outstanding obligations as contemplated by the Escrow Agreement;
(f) The Issuer shall not have failed to pay principal or interest when due on
any of its outstanding obligations for borrowed money; and
(g) At or prior to the Cosing, the Underwriter shall have received copies of
each of the following documents:
(i) The Official Statement and each supplement or amendment, if
any, thereto, executed on behalf of the Issuer by the Mayor and City Secretary;
(ü) The Ordinance, certified by the City Secretary under its seal as
having been duly adopted by. the Issuer and as being in effect, with such changes
or amendments as may have been agreed to by the Underwriter;
(üi) The opinions of Fulbright & Jaworski ("Bond Counsel") in
substantially the fonn and substance of Appendix C to the Official Statement
and a reliance letter from Bond Counsel addressed to the Underwriter, each
dated the date of Closing;
(iv) An opinion or certificate, dated on or prior to the date of Closing,
of the Attorney General of Texas, approving the Bonds as required by law and
the registration certificate of the Comptroller of Public Accounts of the State of
Texas;
(v) The supplemental opinion, dated the date of Cosing, of Fulbright
& Jaworski addressed to the Issuer and the Underwriter to the effect that: (A) the
Bonds are exempt securities within the meaning of Section 3(a)(2) of the
Securities Act of 1933, as amended, and it is not necessary in connection with
the sale of the Bonds to the public to register the Bonds under the Securities Act
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13820016:2
of 1933, as amended, or to qualify the Ordinance under the Trust Indenture Act
of 1939, as amended; (B) except to the extent noted herein, said Ímn has not
verified and is not passing upon, and does not assume any responsibility for, the
accuracy, completeness or fairness of the statements contained in the Official
Statement but that said Í1D11 has reviewed the infonnation relating to the Bonds
and the Ordinance contained under the captions "Plan of Financing," "Bond
Infonnation," "Other Relevant Infonnation - Tax Exemption," "Other Relevant
Infonnation - Tax Accounting Treatment of Discount Bonds" and "Other
Relevant Infonnation - Legal Investments and Eligibility to Secure Public Funds
in Texas" contained in the Official Statement and such Ímn is of the opinion that
the infonnation relating to the Bonds and the Ordinance contained under such
captions is a fair and accurate summary of the infonnation purported to be
shown and that the infonnation and descriptions contained under such captions
relating to the provisions of applicable state and federal laws confonn to such
state and federal laws; and (C) such Ímn has reviewed the Official Statement
and, although such Ímn has not undertaken to verify, is not passing upon, and
does not assume any responsibility for, the accuracy, completeness or fairness of
the statements contained in the Official Statement, and although such Ímn has
not been requested to investigate or verify and have not independently
investigated or verified any records, data or other material relating to the
Ímancial condition or capabilities of the Issuer and has not assumed any
responsibility with respect thereto, such fmn does not have knowledge of facts
wlùch have resulted in a conclusion that the Official Statement (excluding
therefrom the reports, Ímancial and statistical data and forecasts included
therein, and excluding therefrom the Appendices thereto, all as to wlùch such
finn expresses no view) contains any untrue statement of a material fact or omits
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under wlùch they were made,
not misleading;
(vi) The opinion, dated the date of Closing, of Hughes & Luce, L.L.P.
("Underwriter's Counsel") addressed to the Underwriter as to such matters as
the Underwriter may reasonably request;
(vii) A certificate, dated the date of Closing, signed by the City
Manager and Director of Finance of the City, to the effect that (A) the
representations and warranties of the Issuer contained herein are true and correct
in all material respects on and as of the date of Closing as if made on the date of
Closing; (B) except to the extent disclosed in the Official Statement, no
litigation is pending or, to the knowledge of such persons, threatened in any
court to restrain or enjoin the issuance or delivery of the Bonds, or the levy,
collection, or application of the ad valorem taxes pledged or to be pledged to pay
9
13820016:2
the principal of and interest on the Bonds, or the pledge thereof, or in any way
contesting or affecting the validity of the Bonds, the Ordinance, the Escrow
Agreement, or this Bond Purchase Agreement, or contesting the powers of the
Issuer or contesting the authorization of the Bonds or the Ordinance, or
contesting in any way the accuracy, completeness or fairness of the Official
Statement (but in lieu of or in conjunction with such certificate the Underwriter
may, in its sole discretion, accept certificates or opinions of the City Attorney
that, in his or her opinion, the issues raised in any such pending or threatened
litigation are without substance or that the contentions of all plaintiffs therein
are without merit); (C) to the best of their knowledge, no event affecting the
Issuer has occurred since the date of the Official Statement which should be
disclosed in the Official Statement for the purpose for which it is to be used or
which it is necessary to disclose therein in order to make the statements and
infonnation therein not misleading in any respect; and (D) there has not been
any material and adverse change in the affairs or fmancial condition or
anticipated future fmancial condition or prospects of the Issuer since September
30,1991, the latest date as to which audited fmancial infonnation is available;
(vüi) A certificate, dated the date of the Closing, of the Director of
Finance of the City to the effect that, on the basis of the facts, estimates and
circumstances in effect on the date. of delivery of the Bonds, it is not expected
that the proceeds of the Bonds will be used in a manner that would cause the
Bonds to be arbitrage bonds within the meaning of Section 148 of the Internal
Revenue Code of 1986, as amended;
(ix) A copy of a special report prepared by the independent Certified
Public Accountants named in the Official Statement, addressed to the Issuer,
Bond Counsel, the Underwriter and Underwriter's Counsel, verifying the
arithmetical computations of the adequacy of the maturing principal and interest
on the escrowed securities and uninvested cash on hand under the Escrow
Agreement to pay, when due, the principal of and interest on the bonds being
refunded and the computation of the yield with respect to such securities and the
Bonds;
(x) A copy of or policy of municipal bond insurance insuring the
timely payment of the principal of and interest on the Bonds issued by a
company having the highest rating by Standard & Poor's Corporation and
Moody's Investors Service;
(xi) Evidence of the rating or ratings on the Bonds shall be delivered
in a fonn acceptable to the Underwriter; and
(xü) Such additional legal opinions, certificates, instruments and other
documents as the Underwriter or the Underwriter's Counsel may request to
evidence the truth, accuracy and completeness, as of the date hereof and as of
the date of Closing, of the Issuer's representations and warranties contained
herein and of the statements and infonnation contained in the Official Statement
and the due perfonnance and satisfaction by the Issuer on or prior to the date of
Closing of all agreements then to be perfonned and all conditions then to be
satisfied by the Issuer.
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All of the opinions, letters, certificates, instruments and other documents mentioned
above or elsewhere in this Bond Purchase Agreement shall be deemed to be in compliance
with the provisions hereof if, but only if, they are in fonn and substance satisfactory to the
Underwriter.
If the Issuer shall be unable to satisfy the conditions to the obligations of the
Underwriter to purchase, to accept delivery of and to pay for the Bonds contained in this Bond
Purchase Agreement, or if the· obligations of the Underwriter to purchase, to accept delivery of
and to pay for the Bonds shall be tenninated for any reason pennitted by this Bond Purchase
Agreement, this Bond Purchase Agreement shall tenninate and neither the Underwriter nor
the Issuer shall be under further obligation hereunder, except that the respective obligations of
the Issuer and the Underwriter set forth in Section 9 hereof shall continue in full force and
effect, and the Issuer shall return to the Underwriter the deposit check referred to in Section 1
hereof.
8. TennÎl1ation. The Underwriter shall have the right to tenninate in its absolute
discretion the Underwriter's obligations under this Bond Purchase Agreement to purchase, to
accept delivery of and to pay for the Bonds by notifying the Issuer of its election to do so if,
after the execution hereof and prior to the Closing:
(a) (i) Legislation (including any amendment thereto) shall have been
introduced in or adopted by either House of the Congress of the United States or
recommended to the Congress or otherwise endorsed for passage by the President of the
United States, the Treasury Department of the United States, the Internal Revenue
Service or the Chainnan or ranking minority member of the Committee on Finance of
the United States Senate or the Committee on Ways and Means of the United States
House of Representatives, or legislation is proposed for consideration by either such
committee by any member thereof or presented as an option for consideration by either
such committee by the staff of such committee, or by the staff of the Joint Committee
on Taxation of the Congress of the United States, or a bill to amend the Internal
Revenue Code (which, if enacted, would be effective as of a date prior to the Closing)
shall be fIled in either House, or (ii) a decision shall have been rendered by a court
established under Artic1em of the Constitution of the United States or by the United
States Tax Court, or (iii) an order, ruling or regulation shall have been issued or
proposed by or on behalf of the Treasury Department of the United States or the Internal
Revenue Service or any other agency of the United States, or (iv) a release or official
statement shall have been issued by the President of the United States or by the
Treasury Department of the United States or by the Internal Revenue Service, the effect
of which, in any such case described in clause (i), (ii), (ill), or (iv), would be to impose,
directly or indirectly, federal income taxation upon interest received on obligations of
the general character of the Bonds or upon income of the general character to be derived
by the Issuer, other than as imposed on the Bonds and income therefrom under the
federal tax laws in effect on the date hereof, in such a manner as in the judgment of the
Underwriter would make it impracticable to market the Bonds on the tenns and in the
manner contemplated in the Official Statement.
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13820016:2
(b) Any action shall have been taken by the Securities and Exchange
Commission or by a court which would require registration of any security under the
Securities Act of 1933, as amended, or qualification of any indenture under the Trust
Indenture Act of 1939, as amended, in connection with the public offering of the Bonds,
or any action shall have been taken by any court or any governmental authority
suspending the use of Prellininary Official Statement or the Official Statement or any
amendment or supplement thereto, or any proceeding for that purpose shall have been
initiated or threatened in any such court or by any such authority.
(c) (i) The Constitution of the State of Texas shall be amended or an amendment
shall be proposed, or (ii) legislation shall be enacted, or (ill) a decision shall have been
rendered as to matters of Texas law, or (iv) any order, ruling or regulation shall have
been issued or proposed by or on behalf of the State of Texas, or by an official, agency
or department thereof, affecting the legality or tax status of the Issuer, its property or
income, its notes or bonds (including the Bonds) or the interest thereon, which in the
judgment of the Underwriter would make it impracticable to market the Bonds on the
tenns and in the manner contemplated in the Official Statement.
(d) Any fact or event shall exist or have existed that in the Underwriter's
judgment requires or has required a supplement or amendment to the Official
Statement, which in the judgment of the Underwriter would make it impracticable to
market the Bonds on the tenns and in the manner contemplated in the Official
Statement.
(e) (i) (A) trading generally shall have been suspended or materially limited on
or by, as the case may be, either of the New York Stock Exchange or the American
Stock Exchange, (B) a general moratorium on commercial banking activities in New
York shall have been declared by either federal or New York state authorities, or (C)
there shall have occurred any outbreak or escalation of hostilities or any change in
fmancial markets or any calamity or crisis that, in the judgment of the Underwriter, is
material and adverse and (ii) in the case of any of the events specified in clauses (A)
through (C), such event singly or together with any other such event makes it, in the
judgment of the Underwriter, impracticable to market the Bonds on the tenns and in the
manner contemplated in the Official Statement.
(f) There shall have occurred any downgrading, or any notice shall have
been given of (i) any intended or potential downgrading or (ü) any review or possible
change that does not indicate the direction of a possible change, in the rating accorded
any of the Issuer's obligations (including the rating to be accorded the Bonds) by any
"nationally recognized statistical rating organization," as such tenn is defmed for
pwposes of Rule 436(g)(2) under the Securities Act of 1933, as amended.
(g) Legislation shall have been enacted by the federal government or the
State of Texas, a decision of any federal or State of Texas court shall have been made,
or a ruling or regulation (proposed, temporary or Ímal) of the Securities and Exchange
Commission or other governmental agency shall have been made or issued that, in the
opinion of Underwriter's Counsel, has the effect of requiring the contemplated
distribution of the Bonds or any agreement offered in connection therewith to be
registered under the Securities Act of 1933, as amended, or the 'Ordinance to be
qualified as an indenture under the Trust Indenture Act of 1939, as amended.
12
13820016:2
(h) The purchase of and payment for the Bonds by the Underwriter, or the
resale of the Bonds by the Underwriter, on the tenns and conditions herein provided
shall be prohibited by any applicable law, govenunental authority, board, agency or
c01mnission.
9. Expenses. (a) The Underwriter shall be under no obligation to pay, and
the Issuer shall pay, any expenses incident to the perfonnance of the Issuer's
obligations hereunder, including but not limited to: (i) the cost of the preparation,
printing and delivery of the Preliminary Official Statement and the Official Statement;
(ü) the cost of the preparation and printing of the Bonds; (üi) the fees and expenses of
Fulbright & 1 aworski, Bond Counsel to the Issuer; (iv) the fees and disbursements of
First Southwest Company for their services as fmancial advisor to the Issuer; (v) the
fees and disbursements of any engineers, accountants, and other experts, consultants, or
advisors retained by the Issuer, including the fee of the independent Certified Public
Accountant for the preparation of the verification report relating to the refunding; and
(vi) the fees for bond ratings and travel or other expenses incurred incident thereto.
(b) The Underwriter shall pay: (i) the cost of the preparation and printing of
the underwriting documents, including, without limitation, this Bond Purchase
Agreement; (ü) all advertising expenses incurred in the public offering of the Bonds;
and (ill) all other expenses incurred by the Underwriter in connection with the public
offering of the Bonds, including the fees and disbursements of its counsel.
10. Notices. Any notice or other communication to be given to the Issuer under this
Bond Purchase Agreement may be given by delivering the same in writing at the address for
the Issuer set forth above, and any notice or other communication to be given to the
Underwriter under this Bond Purchase Agreement may be given by delivering the same in
writing to Prudential Securities Incorporated, 2121 San Jacinto Street, Suite 1900, Dallas,
Texas 75201, Attention: 10hn W. Thomas, Vice President.
11. Parties in Jl1terest. This Bond Purchase Agreement as heretofore specified shall
constitute the entire agreement between us and is made solely for the benefit of the Issuer and
the Underwriter (including successors or assigns of the Underwriter) and no other person shall
acquire or have any right hereunder or by virtue hereof. This Bond Purchase Agreement shall
remain operative and in full force and effect, regardless of (i) any investigations made by or
on behalf of the Underwriter; (ii) delivery of and payment for the Bonds pursuant to this Bond
Purchase Agreement; and (ill) any tennination of this Bond Purchase Agreement.
12. Effective Date. This Bond Purchase Agreement shall become effective upon the
execution of the acceptance hereof by the Issuer and shall be valid and enforceable as of the
time of such acceptance.
13. Choice of Law. This Bond Purchase Agreement shall be governed by and
construed in accordance with the laws of the State of Texas.
14. Severability. If any provision of this Bond Purchase Agreement shall be held or
deemed to be or shall, in fact, be invalid, inoperative or unenforceable as applied in any
particular case in any jurisdiction or jurisdictions, or in all jurisdictions because it conflicts
with any provisions of any Constitution, statute, rule of public policy, or any other
13
13820016:2
reason, such circumstances shall not have the effect of rendering the provision in question
invalid, inoperative or unenforceable in any other case or circumstance, or of rendering any
other provision or provisions of this Bond Purchase Agreement invalid, inoperative or
unenforceable to any extent whatever.
15. Business Day. For purposes of this Bond Purchase Agreement, "business day"
means any day on which the New York Stock Exchange is open for trading.
16. Section Hearlini's. Section headings have been inserted in this Bond Purchase
Agreement as a matter of convenience of reference only, and it is agreed that such section
headings are not a part of this Bond Purchase Agreement and will not be used in the
interpretation of any provisions of this Bond Purchase Agreement.
17. Counterparts. This Bond Purchase Agreement may be executed in several
counterparts each of which shall be regarded as an original (with the same effect as if the
signatures thereto and hereto were upon the same document) and all of which shall constitute
one and the same document.
Very truly yours,
PRUDENTIAL SECURITIES
INCORPORATED
By: W(lh~'l/{J· dfJI1?ZÆ-~
Û1>hn W. Thomas, Vice President
ACCEPTED:
This 10th day of February, 1992
By: ,J~~-CA~
Mayor ~
The City of North Riclùand Hills, Texas
ATIEST:
By: Q/0t~ø;;; ~
~~retary
(SEAL)
14
13820016:2
~ ",}} ~,j ~; .,,-,
SPECIAL ESCROW AGREEMENT
THE STATE OF TEXAS
§
§
§
COUNTY OF TARRANT
THIS SPECIAL ESCROW AGREEMENT (the "Ag reement") I made and
entered into as of February 10, 1992, by and between the Ci ty
of North Richland Hi lIs, Texas, a duly incorporated municipa 1
corporation in Tarrant County, Texas (the "City") acting by and
through the Mayor and City Secretary, and Team Bank, Fort
Worth, Texas (the "Bank"), a state banking corporation
organized and existing under the laws of the State of Texas,
WIT N E SSE T H :
WHEREAS, the City has duly issued certain obligations now
outstanding in the total aggregate amount $17,800,000 of the
following issue or series (hereinafter called the "Refunded
Obligations"), to wit:
(1) City of North Rich1and Hills, Texas,
General Obligation Refunding and Improvement
Bonds, Series 1985, dated November 1, 1985,
maturing on February 15, 1996 through
February 15, 1999, and aggregating in principal
amount of
$4,010,000
(2) City of North Richland Hills, Texas,
General Obligation Bonds, Series 1986, dated
August 1, 1986, maturing on February 15, 1997
through February 15, 2007, and aggregating in
principal amount of
$4,490,000
(3) City of North Richland Hills, Texas,
General Obligation Bonds, Series 1987, dated
July 1, 1987, maturing on February 15, 1998
through February 15, 2008, and aggregating in
principal amount of
$5,810,000
(4) City of North Richland Hills, Texas,
General Obligation Bonds, Series 1989, dated
March 1, 1989, maturing on February 15, 2000
through February 15, 2009, and aggregating in
principal amount of
$3,490,000
AND WHEREAS, in accordance with the provisions of Article
7l7k, V.A.T.C.S., as amended (the "Act"), the City is
authorized to sell refunding bonds in an amount sufficient to
provide for the payment of obligations to be refunded, deposit
the proceeds of such refunding bonds with the place of payment
for the obligations being refunded and enter into an escrow or
simi lar agreement with such place of payment for the
safekeeping, investment, reinvestment, administration and
disposition of such deposit, upon such terms and conditions as
the parties may agree, provided such deposi ts may be invested
only in direct obligations of the United States of America,
including obligations the principal of and interest on are
unconditionally guaranteed by the United States of America, and
which may be in book entry form and which shall mature and/or
bear interest payable at such times and in such amounts as will
be sufficient to provide for the scheduled payment of such
obligations; and
WHEREAS, the Refunded Obligations are scheduled to mature,
or be redeemed, and interest thereon is payable on the dates
and in the manner set forth in Exhibit A attached hereto and
incorporated herein by reference as a part of this Agreement
for all purposes; and
WHEREAS, the City on the lOth day of February, 1992,
pursuant to an ordinance (the "Bond Ordinance") passed and
adopted by the City Counci I, authorized the issuance of bonds
known as "City of North Richland Hills, Texas, General
Obligation Refunding Bonds, Series 1992" (the "Bonds"), and
such Bonds are being issued to refund, discharge and make final
payment of the principal of and interest on the Refunded
Obligations; and
WHEREAS, upon the delivery of the Bonds, the proceeds of
sale are to be used in part to purchase United States Treasury
Securities -State and Local Government Series (hereinafter
called "SLGS" or "Federal Securities"), and such SLGS shall be
immediately credited to and deposited into the "Escrow Fund" to
be held by the Bank in accordance with this Agreement; and
WHEREAS, a list and description of the SLGS to be
purchased and held for the account of the Escrow Fund 1S
attached hereto as Exhibit B, which Exhibit B is hereby
incorporated by reference and made a part of this Agreement for
all purposes; and
WHEREAS, the Federal Securities, together with the
beginning cash balance, if any, in the Escrow Fund, shall
mature and the interest thereon shall be payable at such times
to insure the existence of monies sufficient to pay the
-2-
principal amount of
interest thereon, as
with the terms of the
Refunded Obligations
hereto; and
the Refunded Obligations and the accrued
the same shall become due in accordance
ordinance authorizing the issuance of the
and as set forth in Exhibi t A attached
WHEREAS, the City has completed all arrangements for the
purchase of the Federal Securities and the deposit and credit
of the same to the Escrow Fund as provided herein; and
WHEREAS, the Bank is a state banking corporation organized
and existing under the laws of the State of Texas, possessing
trust powers and is fully qualified and empowered to enter into
this Agreement; and
WHEREAS, in Section 16 of the Bond Ordinance,
Council duly approved and authorized the execution
Agreement; and
the Ci ty
of this
WHEREAS, the Ci ty and the Escrow Agent, as the case may
be, shall take all action necessary to call, pay, redeem and
retire said Refunded Obligations in accordance with the
provisions thereof, including, without limitation, all actions
required by the ordinance authorizing the Refunded Obligations,
the Act, the Bond Ordinance and this Agreement;
NOW, THEREFORE, in consideration of the mutal agreements
herein contained, and to secure the payment of the principal of
and the interest on the Refunded Obligations as the same shall
become due, the City and the Bank hereby mutually undertake,
promise and agree as follows:
SECTION 1: Receipt of Refunded Bond Ordinance.
Receipt of true and correct copies of the ordinances
authorizing the issuance of the Refunded Obligations and the
Bond Ordinance are hereby aCknowledged by the Bank. Reference
herein to or citation herein of any provision of said documents
shall be deemed an incorporation of such provision as a part
hereof in the same manner and wi th the same effect as if it
were fully set forth herein.
SECTION 2: Escrow Fund Creation/Funding. There is hereby
created by the City with the Bank a special segregated and
irrevocable trust fund designated "SPECIAL CITY OF NORTH
RICHLAND HILLS, TEXAS, REFUNDING BOND ESCROW FUND" (hereinafter
called the "Escrow Fund") for the benefit of the holders of the
Refunded Obligations, and, immediately following the delivery
of the Bonds, the City agrees and covenants to cause to be
deposited with the Bank the following:
-3-
$18,909,000.00 for the purchase of the SLGS listed
in Exhibi t B to be held for the
account of the Escrow Fund;
$
50.00 for deposit in the Escrow Fund as a
beginning cash balance; and
The Bank hereby accepts the Escrow Fund and further agrees
to receive said moneys, apply the same as set forth herein, and
to hold the cash and Federal Securities deposited and credited
to the Escrow Fund for application and disbursement for the
purposes and in the manner provided in this Agreement.
SECTION 3: Escrow Fund Sufficiency Warranty. The City
hereby represents that the cash and Federal Securities,
together wi th the interest to be earned thereon, deposi ted to
the credit of the Escrow Fund will be sufficient to pay the
principal of and premium and interest on the Refunded
Obligations as the same shall become due and payable, and such
Refunded Obligations, and the interest thereon, are to mature
or be redeemed and shall be paid at the times and in the
amounts set forth and identified in Exhibit A attached hereto.
FURTHERMORE, the Bank aCknowledges receipt of a copy of
the resolution by the City Council of the City providing for
the redemption of (i) the Series 1985 Refunded Obligations on
February IS, 1995 at the redemption price of par plus accrued
interest, (ii) the Series 1986 Refunded Obligations on
February IS, 1996 at the redemption price of par plus accrued
interest, (iii) the Series 1987 Refunded Obligations on
February IS, 1997 at the redemption price of par plus accrued
interest, and (iv) the Series 1989 Refunded Obligations on
February IS, 1999 at the redemption price of par plus accrued
interest; all in accordance with the provisions of the notice
requirements applicable to said Refunded Obligations and the
notice requirements contained in the respective ordinances
authorizing the Refunded Obligations.
The Bank agrees that to cause a notice of redemption
pertaining to the above identified obligations to be sent to
the registered owners thereof appearing on the registration
books at least thirty (30) days prior to the respe~tive
redemption dates therefor.
SECTION 4: Pledge of Escrow. The Bank ag rees that all
cash and Federal Securities, together with any income or
interest earned thereon, held in the Escrow Fund shall be and
is hereby irrevocably pledged to the payment of the principal
of and interest on the Refunded Obligations which will mature
and become due on and after the date of this Agreement, and
-4-
such funds initially deposited and to be received from maturing
principal and interest on the Federal Securities in the Escrow
Fund shall be applied solely in accordance with the provisions
of this Agreement.
SECTION 5: Escrow Insufficiency - City Warranty to Cure.
If, for any reason, the funds on hand in the Escrow Fund shall
be insufficient to make the payments set forth in Exhibit A
attached hereto, as the same becomes due and payable, the City
shall make timely deposits to the Escrow Fund, from lawfully
available funds, of additional funds in the amounts required to
make such payments. Notice of any such insufficiency shall be
immediately given by the Bank to the City by the fastest means
possible, but the Bank shall in no manner be responsible for
the City's failure to make such deposits.
SECTION 6: Escrow Fund Securities/Segregation. The Bank
shall hold said Federal Securities and moneys in the Escrow
Fund at all times as a special and separate trust fund for the
benefit of the holders of the Refunded Obligations, wholly
segregated from other moneys and securities on deposit with the
Bank; shall never commingle said Federal Securities and moneys
with other moneys or securities of the Bank; and shall hold and
dispose of the assets therein only as set forth herein.
Nothing herein contained shall be construed as requiring the
Bank to keep the identical moneys, or any part thereof, in said
Escrow Fund, if it is impractical, but moneys of an equal
amount, except to the extent such are represented by the
Federal Securities, shall always be maintained on deposit in
the Escrow Fund by the Bank, as trustee; and a special account
evidencing such facts shall at all times be maintained on the
books of the Bank.
SECTION 7: Escrow Fund Collections/Payments. The Bank
shall from time to time collect and receive the principal of
and interest on the Federal Securities as they respectively
mature and become due and credi t the same to the Escrow Fund.
On or before each principal and/or interest payment date or
redemption date, as the case may be, for the Refunded
Obligations shown in Exhibit A attached hereto, the Bank,
without further direction from anyone, including the City,
shall cause to be withdrawn from the Escrow Fund the amount
required to pay the accrued interest on the Refunded
Obligations due and payable on said payment date and the
principal of the Refunded Obligations due and payable on said
payment date or redemption date, as the case may be, and the
amount withdrawn from the Escrow Fund shall be immediately
transmitted and deposited with the paying agent for the
Refunded Obligations to be paid wi th such amount. The paying
agent for the Refunded Obligations is the Bank.
-5-
If any Refunded Obligation or interest coupon thereon
shall not be presented for payment when the principal thereof
or interest thereon shall have become due, and if cash shall at
such times be held by the Bank in trust for that purpose
sufficient and available to pay the principal of such Refunded
Obligation and interest thereon it shall be the duty of the
Bank to hold said cash without liability to the holder of such
Refunded Obligation for interest thereon after such maturity or
redemption date, in trust for the benefit of the holder of such
Refunded Obligation, who shall thereafter be restricted
exclusively to said cash for any claim of whatever nature on
his part on or with respect to said Refunded Obligation,
including for any claim for the payment thereof and interest
thereon. All cash required by the provisions hereof to be set
aside or held in trust for the payment of the Refunded
Obligations, including interest thereon, shall be applied to
and used solely for the payment of the Refunded Obligations and
interest thereon wi th respect to which such cash has been so
set aside in trust.
Subject to the provisions of the last sentence of
Section 25 hereof, cash held by the Bank in trust for the
payment and discharge of any of the Refunded Obligations and
interest thereon which remains unclaimed for a period of
four (4) years after the stated maturi ty date or redemption
date of such Refunded Obligations shall be returned to the
Ci ty. Notwi thstanding the above and foregoing, any remi ttance
of funds f rom the Bank to the Ci ty sha 11 be subj ect to any
applicable unclaimed property laws of the State of Texas.
SECTION 8: Disposal of Refunded Obligations. All
Refunded Obligations cancelled on account of payment by the
Bank shall be disposed of or otherwise destroyed by the Bank,
and an appropriate certificate of destruction furnished the
City.
SECTION 9: Escrow Fund Encumbrance. The escrow created
hereby shall be irrevocable and the holders of the Refunded
Obligations shall have an express lien on all moneys and
Federal Securities in the Escrow Fund until paid out, used and
applied in accordance with this Agreement.
Unless disbursed in payment of the Refunded Obligations,
all funds and the Federal Securities received by the Bank for
the account of the City hereunder shall be and remain the
property of the Escrow Fund and the City and the owners of the
Refunded Obligations shall be entitled to a preferred claim and
shall have a first lien upon such funds and Federal Securities
enjoyed by a trust beneficiary. The funds and Federal
Securities received by the Bank under this Agreement shall not
-6-
be considered as a banking deposit by the City and the Bank and
the Ci ty shall have no right or ti tIe wi th respect thereto,
except as otherwise provided herein. Such funds and Federal
Securi ties shall not be subject to checks or drafts drawn by
the City.
SECTION 10: Absence of Bahk Claim/Lien on Escrow Fund.
The Bank shall have no lien whatsoever upon any of the moneys
or Federal Securities in the Escrow Fund for payment of
services rendered hereunder, services rendered as paying
agent/registrar for the Refunded Obligations, or for any costs
or expesnes incurred hereunder and reimbursable from the City.
SECTION 11: Substitution of Investments. The Bank shall
be authorized to accept initially and temporarily cash and/or
substituted securities pending the delivery of the Federal
Securities identified in the Exhibit B attached hereto, or
shall be authorized to redeem the Federal Securities and
reinvest the proceeds thereof, together with other moneys held
in the Escrow Fund in noncallable direct obligations of the
Uni ted States of America provided such early redemption and
reinvestment of proceeds does not change the repayment schedule
of the Refunded Obligations appearing in Exhibit A and the Bank
receives the following:
(1) an opinion by an independent certified
public accountant to the effect that (i) the initial
and/or temporary substitution of cash and/or
securities for one or more of the Federal Securities
identified in Exhibit B pending the receipt and
delivery thereof to the Escrow Agent or (ii) the
redemption of one or more of the Federa 1 Securi ties
and the reinvestment of such funds in one or more
substituted securities (which shall be noncallable
direct obligations of the United States of America),
together with the interest thereon and other
available moneys then held in the Escrow Fund, will,
in either case, be sufficient to pay, as the same
become due in accordance with Exhibit A, the
principal of, and interest on, the Refunded
Obligations which have not previously been paid, and
(2) with respect to an early redemption of
Federal Securities and the reinvestment of the
proceeds thereof, an unqualified opinion of
nationally recognized municipal bond counsel to the
effect that (a) such investment will not cause
interest on the Bonds or Refunded Obligations to be
included in the gross inèome for federal income tax
purposes, under the Code and related regulations as
-7-
in effect on the date of such investment, or
otherwise make the interest on the Bonds or the
Refunded Obligations subject to Federal income
taxation and (b) such reinvestment complies with the
Constitution and laws of the State of Texas and with
all relevant documents relating to the issuance of
the Refunded Obligations and the Bonds.
SECTION 12: Restriction on Escrow Fund Investments -
Reinvestment. Except as provided in Section 11 hereof, moneys
in the Escrow Fund will be invested only in the Federal
Securities listed in Exhibit B and neither the City nor the
Bank shall reinvest any moneys deposited in the Escrow Fund
except as specifically provided by this Agreement.
SECTION 13: Excess Funds. If at any time through
redemption or cancellation of the Refunded Obligations there
exists or will exist excesses of interest on or maturing
principal of the Federal Securi ties in excess of the amounts
necessary hereunder for the Refunded Obligations, the Bank may
transfer such excess amounts to or on the order of the Ci ty,
provided that the City delivers to the Bank the following:
(1) an opinion by an independent certified
public accountant that after the transfer of such
excess, the principal amount of securities in the
Escrow Fund, together wi th the interest thereon and
other available monies then held in the Escrow Fund,
will be sufficient to pay, as the same become due, in
accordance with Exhibit A, the principal of, and
interest on, the Refunded Obligations which have not
previously been paid, and
(2) an unqualified opinion of nationally
recognized municipal bond counsel to the effect that
(a) such transfer will not cause interest on the
Bonds or the Refunded Obligations to be included in
gross income for federal income tax purposes, under
the Code and related regulations as in effect on the
date of such transfer, or otherwise make the interest
on the Bonds or the Refunded Obligations subject to
Federal income taxation, and (b) such transfer
complies with the Constitution and laws of the State
of Texas and with all relevant documents relating to
the issuance of the Refunded Obligations or the Bonds.
SECTION 14: Collateralization. The Bank shall
continuously secure the monies in the Escrow Fund not invested
in Federal Securities by a pledge of direct obligations of the
Uni ted States of America, in the par or face amount at least
-8-
equal to the principal amount of said uninvested monies to the
extent such money is not insured by the Federal Deposit
Insurance Corporation.
SECTION 15: Absence of Bank's Liability for Investments.
The Bank shall not be liable or responsible for any loss
resulting from any investment made in the Federal Securities or
substitute securities as provided in Section 11 hereof.
SECTION 16: Bank's Compensation - Escrow Administration/
Settlement of Paying Agent's Charges. The City agrees to pay
the Bank for the performance of services hereunder and as
reimbursement for anticipated expenses to be incurred hereunder
the amount of $4,700.00 and, except for reimbursement of costs
and expenses incurred by the Bank pursuant to Sections 3, 11,
and 19 hereof, the Bank hereby agrees said amount is full and
complete payment for the administration of this Agreement.
The City also agrees to deposit with the Bank on the
effect i ve date of this Agreement, the sum of $17,250.00 which
deposi t represents the total charges due for the paying agent
for the Refunded Obligations, and the Bank acknowledges and
agrees that the above amount is and represents the total amount
of compensation due the Bank for services rendered as paying
agent for the Refunded Obligations. The Bank hereby agrees to
pay, assume and be fully responsible for any additional charges
that it may incur in the performance of its duties and
responsibilities as paying agent for the Refunded Obligations.
The City acknowledges and agrees that the above amount
deposited with the Escrow Agent to cover paying agents' charges
and expenses does not include amounts which shall become due
and payable for services rendered as registrar and transfer
agent for fully registered Refunded Obligations, and the City
agrees to pay directly to each "registrar" for the Refunded
Obligations all reasonable costs, expenses and charges incurred
in connection with the maintenance of the registration books
and records and the transfer of such fully registered
obligations as and when such costs, expenses and charges are
incurred and against written invoices, statements or bills
submitted therefor.
SECTION 17: Escrow Agent's Duties / Responsibilities/
Liability. The Bank shall not be responsible for any recital
herein, except with respect to its organization and its powers
and authority. As to the existence or nonexistence of any fact
relating to the City or as to the sufficiency or validity of
any instrument, paper or proceedings relating to the City, the
Bank shall be entitled to rely upon a certificate signed on
behalf of the City by its Ci ty Manager or Mayor and/or Ci ty
-9-
Secretary of the City as sufficient evidence of the facts
therein contained. The Bank may accept a certificate of the
Ci ty Secretary under the Ci ty I S seal, to the effect that a
resolution or other instrument in the form therein set forth
has been adopted by the City Council of the City, as conclusive
evidence that such resolution or other instrument has been duly
adopted and is in full force and effect.
The duties and obligations of the Bank shall be determined
solely by the express provisions of this Agreement and the Bank
shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this
Agreement, and no implied covenants or obligations shall be
read into this Agreement against the Bank.
In the absence of bad faith on the part of the Bank, the
Bank may conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon any
certificate or opinion furnished to the Bank, conforming to the
requi rements of this Agreement; but notwi thstanding any
provision of this Agreement to the contrary, in the case of any
such certificate or opinion or any evidence which by any
provision hereof is specifically required to be furnished to
the Bank, the Bank shall be under a duty to examine the same to
determine whether it conforms to the requirements of this
Agreement.
The Bank shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Officers of the
Bank unless it shall be proved that the Bank was negligent in
ascertaining or acting upon the pertinent facts.
The Bank shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance
wi th the di rect ion 0 f the ho Iders of not less than a maj or i ty
in aggregate principal amount of all said Refunded Obligations
at the time outstanding relating to the time, method and place
of conducting any proceeding for any remedy available to the
Bank not in conflict with the intent and purpose of this
Agreement. For the purposes of determining whether the holders
of the required principal amount of said Refunded Obligations
have concurred in any such direction, Refunded Obligations
owned by any obligor upon the Refunded Obligations, or by any
person directly or indirectly controlling or controlled by or
under direct or indirect common control with such obligor,
shall be disregarded, except that for the purposes of
determining whether the Bank shall be protected in relying on
any such direction only Refunded Obligations which the Bank
knows are so owned shall be so disregarded.
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The term "Responsible Officers" of the Bank, as used in
this Agreement, shall mean and include the Chairman of the
Board of Directors, the President, any Vice President and any
Second Vice President, the Secretary and any Assistant
Secretary, the Treasurer and any Assistant Treasurer, any Trust
Officer, and every other officer and assistant officer of the
Bank customarily performing functions similar to those
performed by the persons who at the time shall be officers,
respectively, or to whom any corporate trust matter is
referred, because of his knowledge of and familiarity with a
particular subject; and the term "Responsible Officer" of the
Bank, as used in this Agreement, shall mean and include any of
said officers or persons.
SECTION 18: Limitation Re: Bank's Duties/Responsibilities/
Liabilities to Third Parties. The Bank shall not be
responsible or liable to any person in any manner whatever for
the sufficiency, correctness, genuineness, effectiveness, or
validity of this Agreement with respect to the City, or for the
identity or authority of any person making or executing this
Agreement for and on behalf of the City. The Bank is
authorized by the City to rely upon the representations of the
City with respect to this Agreement and the deposits made
pursuant hereto and as to the City's right and power to execute
and deliver this Agreement, and the Bank shall not be liable in
any manner as a result of such reliance. The duty of the Bank
hereunder shall only be to the City and the holders of the
Refunded Obligations. Neither the City nor the Bank shall
assign or attempt to assign or transfer any interest hereunder
or any portion of any such interest. Any such assignment or
attempted assignment shall be in direct conflict with this
Agreement and be without effect.
SECTION 19: Interpleader. In the event of any
disagreement or controversy hereunder or if conflicting demands
or notices are made upon Bank growing out of or relating to
this Agreement or in the event that the Bank in good faith is
in doubt as to what action should be taken hereunder, the City
expressly agrees and consents that the Bank shall have the
absolute right at its election to:
(a)
1n, and
to the
received
Wi thhold and stop all further proceedings
performance of, this Agreement with respect
issue in question and of all instructions
hereunder in regard to such issue; and
(b) File a suit in interpleader and obtain an
order from a court of appropriate jurisdiction
requiring all persons involved to interplead and
litigate in such court their several claims and
rights among themselves.
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In the event the Bank becomes involved in litigation in
connection with this Section, the City to the extent permitted
by law agrees to indemnify and save the Bank harmless from all
loss, cost, damages, expenses and attorney fees suffered or
incurred by the Bank as a result thereof. The obligations of
the Bank under this Agreement shall be performable at the
principal corporate office of the Bank in the City of Fort
Worth, Texas.
The Bank may advise with legal counsel in the
dispute or question as to the construction of
provisions hereof or its duties hereunder, and it
no liability and shall be fully protected in
accordance with the opinion and instructions of such
event of any
any of the
shall incur
acting in
counsel.
SECTION 20: Accounting - Annual Report. Promptly after
September 30th of each year, commencing wi th the year 1992, so
long as the Escrow Fund is maintained under this Agreement, the
Bank sha 11 forward by letter to the Ci ty, to the attention of
the Di recto r of Finance, or other des igna ted off ici a 1 of the
City, a statement in detail of the Federal Securities and
monies held, and the current income and maturities thereof, and
the withdrawals of money from the Escrow Fund for the preceding
12 month period ending September 30th of each year.
SECTION 21: Notices. Any notice, authorization, request
or demand required or permitted to be given hereunder shall be
in writing and shall be deemed to have been duly given when
mailed by registered or certified mail, postage prepaid
addressed as follows:
CITY OF NORTH RICHLAND HILLS, TEXAS
P. O. Box 820609
North Richland Hills, Texas 76182
Attention: Director of Finance
TEAM BANK
P. O. Box 2604
Fort Worth, Texas 76113
Attention: Corporate Trust Department
The United States Post Office registered or certified mail
receipt showing delivery of the aforesaid shall be conclusive
evidence of the date and fact of delivery.
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Any party hereto may change the address to which notices
are to be delivered by giving to the other parties not less
than ten (10) days prior notice thereof.
SECTION 22: Performance Date. Whenever under the terms
of this Agreement the performance date of any provision hereof,
including the date of maturi ty of interest on or principal of
the Refunded Obligations, shall be a Sunday or a legal holiday
or a day on which the Bank is authorized by law to close, then
the performance thereof, including the payment of principal of
and interest on the Refunded Obligations, need not be made on
such date but may be performed or paid, as the case may be, on
the next succeeding business day of the Bank wi th the same
force and effect as if made on the date of performance or
payment and with respect to a payment, no interest shall accrue
for the period after such date.
SECTION 23: Warranty of Parties Re: Power to Execute and
Deliver Escrow Agreement. The City covenants that it will
faithfully perform at all times any and all covenants,
undertakings, stipulations and provisions contained in this
Agreement, in any and every said Refunded Obligation as
executed, authenticated and delivered and in all proceedings
pertaining thereto as said Refunded Obligations shall have been
modified as provided in this Agreement. The City covenants
that it is duly authorized under the Constitution and laws of
the State of Texas to execute and deliver this Agreement, that
all actions on its part for the payment of said Refunded
Obligations as provided herein and the execution and delivery
of this Agreement have been duly and effectively taken and that
said Refunded Obligations and coupons in the hands of the
holders and owners thereof are and will be valid and
enforceable obligations of the City according to the import
thereof as provided in this Agreement.
SECTION 24: Severability. If anyone or more of the
covenants or agreements provided in this Agreement on the part
of the parties to be performed should be determined by a court
of competent jurisdiction to be contrary to law, such covenant
or agreement shall be deemed and construed to be severable from
the remaining covenants and agreements herein contained and
shall in no way affect the validity of the remaining provisions
of this Agreement.
SECTION 25: Termination. This Agreement shall terminate
when the Refunded Obligations, including interest due thereon,
have been paid and discharged in accordance with the provisions
of this Agreement. If any Refunded Obligations are not
presented for payment when due and payable, the nonpayment
thereof shall not prevent the termination of this Agreement.
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Funds for the payment of any nonpresented Refunded Obligations
and accrued interest thereon shall upon termination of this
Agreement be held by the Bank for such purpose in accordance
with Section 7 hereof. Any moneys or Federal Securities held
in the Escrow Fund at termination and not needed for the
payment of the principal of or interest on any of the Refunded
Obligations shall be paid or transferred to the City.
SECTION 26: Time of the Essence. Time shall be of the
essence in the performance of obligations from time to time
imposed upon the Bank by this Agreement.
SECTION 27: Escrow Agreement - Amendment/Modification.
This Agreement shall be binding upon the City and the Bank and
their respective successors and legal representatives and shall
inure solely to the benefit of the holders of the Refunded
Obligations, the City, the Bank and their respective successors
and legal representatives. Furthermore, no alteration,
amendment or modification of any provision of this Agreement
shall (1) alter the firm financial arrangements made for the
payment of the Refunded Obligations or (2) be effective unless
(i) prior written consent of such alteration, amendment or
modification shall have been obtained from the holders of all
Refunded Obligations outstanding at the time of such
alteration, amendment or modification and (ii) such alteration,
amendment or modification is in writing and signed by the
parties hereto; provided, however, the City and the Bank may,
without the consent of the holders of the Refunded Obligations,
amend or modify the terms and provisions of this Agreement to
cure in a manner not adverse to the holders of the Refunded
Obligations any ambiguity, formal defect or omission in this
Agreement.
SECTION 28: Effect of
herein are for convenience
construction hereof.
Headings.
only and
The
shall
Section headings
not affect the
SECTION 29: Executed Counterparts. This Agreement may
be executed in several counterparts, all or any of which shall
be regarded for all purposes as one original and shall
constitute and be but one and the same instrument. This
Agreement shall be governed by the laws of the State of Texas
and shall be effective as of the date of the delivery of the
Bonds.
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IN WITNESS WHEREOF, the parties hereto have each caused
this Agreement to be executed by their duly authorized officers
and their corporate seals to be hereunto affixed and attested
as of the date first above written.
CITY OF NORTH RICHLAND
HILLS, TEXAS
Mayor
ATTEST:
City Secretary
(City Seal)
TEAM BANK, Fort Worth, Texas,
as Escrow Agent
Assistant Vice President
and Trust Officer
ATTEST:
Trust Officer
(Bank Seal)
6 1 0 9 s
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