HomeMy WebLinkAboutOrdinance 3280ORDINANCE NO. 3280
AN ORDINANCE authorizing the issuance of "CITY OF NORTH
RICHLAND HILLS, TEXAS, GENERAL OBLIGATION REFUNDING AND
IMPROVEMENT BONDS, SERIES 2013 "; 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 Paying Agent /Registrar
Agreement, and an Escrow Agreement, and the approval and distribution
of a Preliminary Official Statement and an Official Statement; providing for
the redemption of the obligations being refunded; and providing an
effective date.
WHEREAS, the City Council (the "Council ") of the City of North Richland Hills, Texas
(the "City ") has heretofore issued, sold, and delivered, and there is currently outstanding,
obligations totaling in principal amount $4,220,000 (collectively, the "Refunded Obligations ")
more particularly described as follows:
(1) City of North Richland Hills, Texas, General Obligation Bonds, Series 2003,
dated April 15, 2003, scheduled to mature on February 15, 2015, and aggregating in the
principal amount of $140,000 (the "Series 2003 Refunded Bonds ");
(2) City of North Richland Hills, Texas, Tax and Waterworks and Sewer System
Surplus Revenue Certificates of Obligation, Series 2004, dated April 15, 2004, scheduled to
mature on February 15, in each of the years 2015 through 2019, and aggregating in the
principal amount of $225,000 (the "Series 2004 Refunded Certificates ");
(3) City of North Richland Hills, Texas, General Obligation Refunding and
Improvement Bonds, Series 2004, dated April 15, 2004, scheduled to mature on February 15 in
each of the years 2015 through 2024, and aggregating in the principal amount of $3,855,000
(the "Series 2004 Refunded Bonds "); and
WHEREAS, pursuant to the provisions of the Texas Government Code, Chapter 1207,
as amended, the Council is authorized to issue refunding bonds and deposit the proceeds of
sale directly with any place of payment for the Refunded Obligations, or other authorized
depository, 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 Council hereby finds and determines that general obligation refunding
bonds should be issued at this time to refund the Refunded Obligations, and such refunding will
result in the City saving approximately $368,043 in debt service payments on such
indebtedness and further provide net present value savings of approximately $331,644; and
WHEREAS, in combination with the issuance of such refunding bonds, the Council
hereby finds and determines that general obligation bonds authorized to be issued at elections
held on February 1, 2003 and May 12, 2012 should be issued and sold at this time; a summary
of the general obligation bonds authorized at such elections, the principal amounts authorized,
amounts heretofore issued and being issued pursuant to this ordinance and amounts remaining
to be issued subsequent hereto being as follows:
57354025.5/11310082
Date of
Amount
Previously
Amount Being
Premium
Unissued
Election Purpose
Authorized ($)
Issued
Issued
Applied ($)"
Balance ($)
2 -1 -03 Street Improvements
30,010,000
22,950,000
2,760,000
50,000
4,250,000
2 -1 -03 Drainage Improvements
4,000,000
3,840,000
0
0
160,000
2 -1 -03 Public Safety Facilities
1,900,000
1,650,000
0
0
250,000
2 -1 -03 Animal Shelter
1,300,000
0
1,275,000
25,000
0
5 -12 -12 Municipal Government
48,000,000
35,000,000
12,765,000
235,000
0
Complex
85,210,000
63,440,000
16,800,000
310,000
4,660,000
* Premium in the amount of $310,000
which the City has allocated to and applied against the voted authorizations
referenced in the above table results in a total amount of $17,110,000 allocated to and
applied against
the voted
authorizations.
AND WHEREAS, the Council hereby reserves and retains the right to issue the balance
of unissued bonds approved at such elections 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; now, therefore,
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF NORTH RICHLAND
HILLS, TEXAS:
SECTION 1: Authorization - Designation - Principal Amount - Purpose. General
obligation bonds of the City shall be and are hereby authorized to be issued in the aggregate
principal amount of $20,945,000, to be designated and bear the title "CITY OF NORTH
RICHLAND HILLS, TEXAS, GENERAL OBLIGATION REFUNDING AND IMPROVEMENT
BONDS, SERIES 2013" (hereinafter referred to as the "Bonds "), for the purpose of providing
funds for (1) the discharge and final payment of certain outstanding obligations of the City
(identified in the preamble hereof and referred to as the "Refunded Obligations "); (2) permanent
public improvements and public purposes, to wit: (i) street improvements, including traffic
signalization, drainage incidental thereto and the acquisition of land therefor, (ii) constructing,
improving, and equipping a new municipal government complex to include City hall facilities,
police and fire facilities and municipal court facilities, including the acquisition of land therefor,
and (iii) constructing and improving the City's animal shelter, and (3) payment of the costs of
issuance of the Bonds, all in accordance with the authority conferred by and in conformity with
the Constitution and laws of the State of Texas, including Chapters 1207 and 1331 of the Texas
Government Code, as amended.
SECTION 2: Fullv Registered Obliqations - Bond Date - Authorized Denominations -
Stated Maturities - Interest Rates. The Bonds shall be issued as fully registered obligations
only, shall be dated October 15, 2013 (the "Bond Date "), shall be in denominations of $5,000 or
any integral multiple (within a Stated Maturity) thereof, 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 with the following schedule:
Maturity
Principal
Interest
Date
Amount
Rates
2014
$ 85,000
2.000%
2015
1,990,000
2.000%
2016
1,510,000
3.000%
2017
1,400,000
3.000%
2018
1,130,000
4.000%
57354025.5/11310082 2
Maturity
Principal
Interest
Date
Amount
Rates
2019
1,125, 000
4.000%
2020
1,070,000
4.000%
2021
1,075,000
4.000%
2022
1,070,000
3.000%
2023
1,070,000
3.000%
2024
1,070,000
3.000%
2025
840,000
3.125%
2026
840,000
3.250%
2027
840,000
3.500%
2028
835,000
3.750%
* * * **
* * * * * * **
* * * * * * **
2030
1,670,000
4.000%
2031
835,000
4.000%
2032
830,000
4.000%
2033
830,000
4.000%
2034
830,000
4.125%
The Bonds shall bear interest on the unpaid principal amounts from the Bond Date at the
rate(s) per annum shown above in this Section (calculated on the basis of a 360 -day year of
twelve 30 -day months). Interest on the Bonds shall be payable on February 15 and August 15
in each year, commencing February 15, 2014, until maturity or earlier redemption.
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 maturity, 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 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 The Bank of New York Mellon Trust Company, N.A.,
Dallas, Texas, to serve as Paying Agent/Registrar for the Bonds is hereby approved and
confirmed. Books and records relating to the registration, payment, transfer and exchange of
the Bonds (the "Security Register') shall at all times be kept and maintained on behalf of the
City by the Paying Agent /Registrar, as provided herein and in accordance with the terms and
provisions of a "Paying Agent /Registrar Agreement ", substantially in the form attached hereto as
Exhibit A, and such reasonable rules and regulations as the Paying Agent /Registrar and the
City may prescribe. The Mayor or Mayor Pro Tern and City Secretary or Assistant City
Secretary are authorized to execute and deliver such Paying Agent/Registrar Agreement in
connection with the delivery of the Bonds. 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 commercial 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 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.
57354025.5/11310082 3
Principal of and premium, if any, on the Bonds shall be payable at the Stated Maturities
or on a date of earlier redemption thereof only upon presentation and surrender of the Bonds to
the Paying Agent /Registrar at its designated offices, initially in East Syracuse, New York, or,
with respect to a successor Paying Agent/Registrar, at the designated offices of such successor
(the "Designated Payment/Transfer Office "). Interest on the Bonds 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 (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 principal of or interest on the Bonds shall be a
Saturday, Sunday, a legal holiday, or a day when banking institutions in the city where the
Designated Payment/Transfer Office of 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 nonpayment of interest on a scheduled payment date, and for thirty (30)
days thereafter, a new record date for such interest payment (a "Special Record Date ") will be
established by the Paying Agent /Registrar, if and when funds for the payment of such interest
have been received from the 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 appearing on the Security
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. The Bonds having Stated Maturities on and after
February 15, 2024, 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 within a
Stated Maturity by lot by the Paying Agent/Registrar), on February 15, 2023 or on any date
thereafter at the redemption price of par plus accrued interest to the date of redemption.
At least forty -five (45) days prior to an optional redemption date for the Bonds (unless a
shorter notification period shall be satisfactory to the Paying Agent /Registrar), the City shall
notify the Paying Agent/Registrar of the decision to redeem Bonds, the principal amount of each
Stated Maturity to be redeemed, and the date of redemption therefor. The decision of the City
to exercise the right to redeem Bonds shall be entered in the minutes of the governing body of
the City.
(b) Mandatory Redemption. The Bonds having a Stated Maturity of February 15,
2030 (the "Term Bonds ") shall be subject to mandatory redemption in part prior to maturity at
the redemption price of par and accrued interest to the date of redemption on the respective
dates and in principal amounts as follows:
57354025.5/11310082 4
Term Bonds due February 15, 2030
Redemption Date Principal Amount
February 15, 2029 $835,000
February 15, 2030* $835,000
Stated maturity.
Approximately forty -five (45) days prior to each mandatory redemption date for the Term
Bonds, the Paying Agent/Registrar shall select by lot the numbers of the Term Bonds within the
applicable Stated Maturity to be redeemed on the next following February 15 from moneys set
aside for that purpose in the Interest and Sinking Fund (as hereinafter defined). Any Term Bond
not selected for prior redemption shall be paid on the date of their Stated Maturity.
The principal amount of the Term Bonds for a Stated Maturity required to be redeemed
on a mandatory redemption date may be reduced, at the option of the City, by the principal
amount of Term Bonds of like Stated Maturity which, at least fifty (50) days prior to the
mandatory redemption date, (1) shall have been acquired by the City at a price not exceeding
the principal amount of such Term Bonds plus accrued interest to the date of purchase thereof,
and delivered to the Paying Agent/Registrar for cancellation or (2) shall have been redeemed
pursuant to the optional redemption provisions set forth in subsection (a) of this Section and not
theretofore credited against a mandatory redemption requirement.
(c) Selection of Bonds for Redemption. If less than all Outstanding Bonds of the
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 of such Bonds by $5,000 and shall select the Bonds, or principal
amount thereof, 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 City and at the City'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 Security Register at
the close of business on the 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 notices of redemption shall (i) specify the date of redemption for the Bonds,
(ii) identify 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 portion of the principal amount thereof to be redeemed, shall
become due and payable on the redemption date specified, and the interest thereon, or on the
portion of the principal amount thereof to be redeemed, shall cease to accrue from and after the
redemption date, and (v) specify that payment of the redemption price for the Bonds, or the
principal amount thereof to be redeemed, shall be made at the Designated Payment/Transfer
Office of the Paying Agent /Registrar only upon presentation and surrender thereof by the
Holder. If a Bond is subject by its terms to prior redemption, and has been called for
redemption, and notice of redemption thereof has been duly given as hereinabove provided,
such Bond (or the principal amount thereof 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 Bond (or of the principal amount thereof to be
57354025.5/11310082 5
redeemed) at the then applicable redemption price are held for the purpose of such payment by
the Paying Agent /Registrar.
(e) Conditional Notice of Redemption. With respect to any optional redemption of
the Bonds, unless moneys sufficient to pay the principal of and premium, if any, and interest on
the Bonds to be redeemed shall have been received by the Paying Agent/Registrar prior to the
giving of such notice of redemption, such notice may state that said redemption is conditional
upon the receipt of such moneys by the Paying Agent/Registrar on or prior to the date fixed for
such redemption, or upon the satisfaction of any prerequisites set forth in such notice of
redemption; and, if sufficient moneys are not received, such notice shall be of no force and
effect, the City shall not redeem such Bonds and the Paying Agent/Registrar shall give notice, in
the manner in which the notice of redemption was given, to the effect that the Bonds have not
been redeemed.
SECTION 5: Registration - Transfer - Exchange of Bonds - Predecessor Bonds. The
Paying Agent /Registrar shall obtain, record, and maintain in the Security Register the name and
address of each and every owner of the Bonds issued under and pursuant to the provisions of
this Ordinance, or if appropriate, the nominee thereof. Any Bond may be transferred or
exchanged for Bonds of other authorized denominations by the Holder, in person or by his duly
authorized agent, upon surrender of such Bond to the Designated Payment/Transfer Office of
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 of any Bond (other than the Initial Bond(s) referenced in Section 8
hereof) for transfer at the Designated Payment/Transfer 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 of authorized denominations and having the same
Stated Maturity and of a like aggregate principal amount as the Bond or Bonds surrendered for
transfer.
At the option of the Holder, Bonds (other than the Initial Bond(s) referenced in Section 8
hereof) may be exchanged for other Bonds of authorized denominations and having the same
Stated Maturity, bearing the same rate of interest and of like aggregate principal amount as the
Bonds surrendered for exchange, upon surrender of the Bonds to be exchanged at the
Designated Payment/Transfer Office of the Paying Agent/Registrar. Whenever any Bonds are
surrendered for exchange, the Paying Agent/Registrar shall register and deliver new Bonds to
the Holder requesting the exchange.
All Bonds issued in any transfer or exchange of Bonds shall be delivered to the Holders
at the Designated Payment/Transfer Office of the Paying Agent /Registrar or sent by United
States Mail, first class, postage prepaid to the Holders, and, upon the registration and delivery
thereof, the same shall be the 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.
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 required to be paid with respect to such
transfer or exchange.
57354025.5/11310082 6
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 new 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 the provisions of 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 issue or transfer to
an assignee of a Holder any Bond called for redemption, in whole or in part, within 45 days of
the date fixed for the redemption of such Bond; provided, however, such limitation on
transferability shall not be applicable to an exchange by the Holder of the unredeemed balance
of a 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, a limited purpose trust company organized under the laws of the State of New
York ( "DTC "), in accordance with the operational arrangements referenced in the Blanket Issuer
Letter of Representations, by and between the City and DTC (the "Depository Agreement ").
Pursuant to the Depository Agreement and the rules of DTC, the Bonds shall be
deposited with DTC who shall hold said Bonds for its participants (the "DTC Participants ").
While the Bonds are held by DTC under the 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 the
Bonds 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 with the Holders of
the Bonds to cause Bonds to be printed in definitive form and provide for the Bond certificates to
be issued and delivered to DTC Participants and Beneficial Owners, as the case may be.
Thereafter, the Bonds in definitive form shall be assigned, transferred and exchanged on the
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 shall be executed on behalf of the
City by the Mayor under its seal reproduced or impressed thereon and countersigned by the
City Secretary or Assistant 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 Bond Date shall be deemed to be duly executed on
behalf of the City, 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 delivered in subsequent exchanges and transfers, all as authorized and provided in the
Texas Government Code, Chapter 1201, as amended.
57354025.5/11310082 7
No Bond 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 9(c), 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 9(d), manually executed by an
authorized officer, employee or representative of the Paying Agent/Registrar, and either such
certificate duly signed upon any Bond shall be conclusive evidence, and the only evidence, that
such Bond has been duly certified, registered, and delivered.
SECTION 8: Initial Bond(s). The Bonds herein authorized shall be initially issued
either (i) as a single fully registered bond in the aggregate principal amount of the Bonds with
principal installments to become due and payable as provided in Section 2 hereof and
numbered T -1, or (ii) as multiple fully registered bonds, being one bond for each year of maturity
in the applicable principal amount and denomination and to be numbered consecutively from
T -1 and upward (hereinafter called the "Initial Bond(s)") and, in either case, the Initial Bond(s)
shall be registered in the name of the initial purchaser(s) or the designee thereof. The Initial
Bond(s) shall be the Bond(s) 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 Bond(s), the Paying Agent/Registrar, pursuant to written instructions from the initial
purchaser(s), or the designee thereof, shall cancel the Initial Bond(s) delivered hereunder and
exchange therefor definitive Bonds of authorized denominations, Stated Maturities, principal
amounts and bearing applicable interest rates for transfer and delivery to the Holders named at
the addresses identified therefor; all pursuant to and in accordance with such written
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 Registration Certificate of Paying Agent/Registrar,
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, substitutions, and
other variations as are permitted or 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 in the event the
Bonds, or any maturities thereof, are purchased with insurance and any reproduction of an
opinion of counsel) thereon as may, consistently herewith, be established by the City or
determined by the officers executing such Bonds as evidenced by their execution. 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 Bond(s) shall be printed, lithographed, 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.
57354025.5/11310082 8
(b) Form of Definitive Bond.
REGISTERED
NO.
REGISTERED
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF NORTH RICHLAND HILLS, TEXAS
GENERAL OBLIGATION REFUNDING AND IMPROVEMENT BOND
SERIES 2013
Bond Date: Interest Rate: Stated Maturity: CUSIP NO:
October 15, 2013 % February 15, 20_
Registered Owner:
Principal Amount:
DOLLARS
The City of North Richland Hills, Texas (hereinafter referred to as the "City "), a body
corporate and political subdivision in the County of Tarrant, State of Texas, for value received,
acknowledges itself indebted to and hereby promises to pay to the Registered Owner named
above, or the registered assigns thereof, on the Stated Maturity 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 interest payment
date next preceding the "Registration Date" of this Bond appearing below (unless this Bond
bears a "Registration Date" as of an interest payment date, in which case it shall bear interest
from such date, or unless the "Registration Date" of this Bond is prior to the initial interest
payment date in which case it shall bear interest from the Bond 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 February
15, 2014, until maturity or earlier redemption. Principal of this Bond is payable at its Stated
Maturity or on a date of earlier redemption to the registered owner hereof, upon presentation
and surrender, at the Designated Payment/Transfer 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. If the date for the payment of the principal of or interest on the Bonds shall be
a Saturday, Sunday, a legal holiday, or a day when banking institutions in the city where the
Designated Payment/Transfer Office of 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. 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
57354025.5/11310082 9
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.
This Bond is one of the series specified in its title issued in the aggregate principal
amount of $20,945,000 (herein referred to as the "Bonds ") for the purpose of providing funds for
(1) the discharge and final payment of certain outstanding obligations of the City (identified in
the preamble hereof and referred to as the "Refunded Obligations "); (2) permanent public
improvements and public purposes, to wit: (i) street improvements, including traffic signalization,
drainage incidental thereto and the acquisition of land therefor, (ii) constructing, improving, and
equipping a new municipal government complex to include City hall facilities, police and fire
facilities and municipal court facilities, including the acquisition of land therefor, and
(iii) constructing and improving the City's animal shelter, and (3) payment of the costs of
issuance of the Bonds, all in accordance with the authority conferred by and in conformity with
the Constitution and laws of the State of Texas, including Texas Government Code, Chapters
1207 and 1331, as amended, and pursuant to an Ordinance adopted by the City Council of the
City (herein referred to as the "Ordinance ").
The Bonds maturing on the date hereinafter identified (the "Term Bonds ") are subject to
mandatory redemption prior to maturity with funds on deposit in the Interest and Sinking Fund
established and maintained for the payment thereof in the Ordinance, and shall be redeemed in
part prior to maturity at the price of par and accrued interest thereon to the mandatory
redemption date on the respective dates and in principal amounts as follows:
Term Bonds due February 15, 2030
Redemption Date Principal Amount
February 15, 2029 $835,000
February 15, 2030 $835,000
Stated maturity.
The particular Term Bonds of a stated maturity to be redeemed on each redemption date
shall be chosen by lot by the Paying Agent/Registrar; provided, however, that the principal
amount of Term Bonds for a Stated Maturity required to be redeemed on a mandatory
redemption date may be reduced, at the option of the City, by the principal amount of Term
Bonds of like Stated Maturity which, at least fifty (50) days prior to the mandatory redemption
date, (1) shall have been acquired by the City at a price not exceeding the principal amount of
such Term Bonds plus accrued interest to the date of purchase thereof, and delivered to the
Paying Agent/Registrar for cancellation or (2) shall have been redeemed pursuant to the
optional redemption provisions appearing below and not theretofore credited against a
mandatory redemption requirement.
The Bonds maturing on and after February 15, 2024, 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, 2023, or on any date thereafter, at the redemption price of
par, together with accrued interest to the date of redemption.
At least thirty days prior to the date fixed for any redemption of Bonds, the City shall
cause a written notice of such redemption to be sent by United States Mail, first class postage
prepaid, to the registered owners of each Bond to be redeemed at the address shown on the
57354025.5/11310082 10
Security Register and subject to the terms and provisions relating thereto contained in the
Ordinance. If a Bond (or any portion of its principal sum) shall have been duly called for
redemption and notice of such redemption duly given, then upon such redemption date such
Bond (or the portion of its principal sum 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 a portion of the principal amount of a Bond is to be redeemed and the
registered owner is someone other than Cede & Co., payment of the redemption price of such
principal amount shall be made to the registered owner only upon presentation and surrender of
such Bond to the Designated Payment/Transfer Office of the Paying Agent /Registrar, and 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 thereof will be issued to
the registered owner, without charge. If a Bond is selected for redemption, in whole or in part,
the City and the Paying Agent/Registrar shall not be required to transfer such 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 of a Bond redeemed in part.
With respect to any optional redemption of the Bonds, unless moneys sufficient to pay
the principal of and premium, if any, and interest on the Bonds to be redeemed shall have been
received by the Paying Agent/Registrar prior to the giving of such notice of redemption, such
notice may state that said redemption is conditional upon the receipt of such moneys by the
Paying Agent /Registrar on or prior to the date fixed for such redemption, or upon the satisfaction
of any prerequisites set forth in such notice of redemption; and, if sufficient moneys are not
received, such notice shall be of no force and effect, the City shall not redeem such Bonds and
the Paying Agent/Registrar shall give notice, in the manner in which the notice of redemption
was given, to the effect that the Bonds have not been redeemed.
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 Designated Payment/Transfer 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 definitions 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 without 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 or redemption, and deemed to be no longer
Outstanding thereunder; and for other terms and provisions contained therein. Capitalized
terms used herein and not otherwise defined 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 Designated
Payment/Transfer 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 Maturity, of authorized denominations, bearing the same rate of interest, and
57354025.5/11310082 11
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 upon its prior 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 thirty (30)
days thereafter, a new record date for such interest payment (a "Special Record Date ") will be
established by the Paying Agent /Registrar, if and when funds for the payment of such interest
have been received from the 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 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 impaired thereby. The terms and provisions 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 City Council of the City has caused this Bond to be duly
executed under the official seal of the City as of the Bond Date.
CITY OF NORTH RICHLAND HILLS, TEXAS
Mayor
COUNTERSIGNED:
City Secretary
(City Seal)
57354025.5/11310082 12
(c) Form of Registration Certificate of Comptroller of Public Accounts to appear on
Initial Bond(s) only.
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER )
OF PUBLIC ACCOUNTS ) REGISTER NO.
THE STATE OF TEXAS )
I HEREBY CERTIFY that this Bond has been examined, certified as to validity and
approved by the Attorney General of the State of Texas, and duly registered by the Comptroller
of Public Accounts of the State of Texas.
(SEAL)
WITNESS my signature and seal of office this
Comptroller of Public Accounts
of the State of Texas
(d) Form of Certificate of Paving 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.
The designated offices of the Paying Agent/Registrar in East Syracuse, NY is the
"Designated Payment/Transfer Office" for this Bond.
Registration date:
(e) Form of Assignment.
THE BANK OF NEW YORK MELLON TRUST
COMPANY, N.A., Dallas, Texas,
as Paying Agent/Registrar
In
Authorized Signature
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns, and transfers unto
(Print or typewrite name, address, and zip code of transferee:)
57354025.5/11310082 13
(Social Security or other identifying number
all rights thereunder, and hereby irrevocably constitutes and appoints
the within Bond and
attorney to transfer the within Bond on the books kept for registration thereof, with full power of
substitution in the premises.
DATED:
Signature guaranteed:
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.
(f) The Initial Bond(s) shall be in the form set forth in paragraph (b) of this Section,
except that the form of the single fully registered Initial Bond shall be modified as follows:
Heading and paragraph one shall be amended to read as follows:
REGISTERED
NO. T -1
REGISTERED
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF NORTH RICHLAND HILLS, TEXAS
GENERAL OBLIGATION REFUNDING AND IMPROVEMENT BOND
SERIES 2013
Bond Date: October 15, 2013
Registered Owner:
Principal Amount:
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 Registered Owner named
above, or the registered assigns thereof, the Principal Amount hereinabove stated on
February 15 in each of the years and in principal installments in accordance with the following
schedule:
MATURITY PRINCIPAL INTEREST
DATE AMOUNT RATES
(Information to be inserted from schedule in Section 2 hereof).
(or so much principal thereof as shall not have been redeemed prior to maturity) and to pay
interest on the unpaid Principal Amount hereof from the Bond Date at the per annum rates 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 February
15, 2014, until maturity or earlier redemption. Principal installments of this Bond are payable on
57354025.5/11310082 14
the Stated Maturity dates or on a redemption date to the registered owner hereof by The Bank
of New York Mellon Trust Company, N.A., Dallas, Texas (the "Paying Agent /Registrar"), upon its
presentation and surrender at its designated offices, initially in East Syracuse, New York, or,
with respect to a successor paying agent/registrar, at the designated office of such successor
(the "Designated Payment/Transfer Office "). Interest is payable to the registered owner of this
Bond 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. If the date
for the payment of the principal of or interest on the Bonds shall be a Saturday, Sunday, a legal
holiday, or a day when banking institutions in the city where the Designated Payment/Transfer
Office of 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. 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.
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
payment at maturity or redemption 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 all taxable property in the City, within 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;
separate books and records relating to the receipt and disbursement of taxes levied, assessed
and collected for and on account of the Bonds shall be kept and maintained by the City at all
times while the Bonds are Outstanding, and the taxes collected for the payment of the Debt
Service Requirements on the Bonds shall be deposited to the credit of a "Special 2013 Bond
Account" (the "Interest and Sinking Fund ") maintained on the records of the City and deposited
in a special fund maintained at an official depository of the City's funds; and such tax hereby
levied, and to be assessed and collected annually, is hereby pledged to the payment of the
Bonds.
The Mayor, Mayor Pro Tem, City Manager, Assistant City Manager, Director of Finance,
City Secretary and Assistant City Secretary of the City, any one or more of said officials, 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 Fund, amounts sufficient to fully pay
and discharge promptly each installment of principal of and interest on the 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.
The City has sufficient current funds available to pay the amounts to become due on the
Bonds on February 15, 2014 and August 15, 2014, and there will be deposited in the Interest
57354025.5/11310082 15
and Sinking Fund such amount of current funds which will be sufficient to pay the amounts to
become due on the Bonds on February 15, 2014 and August 15, 2014.
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 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
City 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.
SECTION 12: Satisfaction of Obligation of City. If the City shall pay or cause to be paid,
or there shall otherwise be paid to the Holders, the principal 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) thereof shall be deemed to have been paid within the
meaning and with the effect expressed above in this Section when (i) money sufficient to pay in
full such Bonds or the principal amount(s) thereof 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 principal of and interest on such Bonds, or the
principal amount(s) thereof, on and prior to the Stated Maturity 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,
57354025.5/11310082 16
or an authorized escrow agent, pursuant to this Section which is not required for the payment of
the Bonds, or any principal amount(s) thereof, or interest thereon with respect to which such
moneys have been so deposited 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
principal of and interest on the Bonds and remaining unclaimed for a period of three (3) years
after the Stated Maturity or applicable redemption date of the Bonds (for which such moneys
were deposited 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.
The term "Government Securities" shall mean (i) direct noncallable obligations of the
United States of America, including obligations the principal of and interest on which are
unconditionally guaranteed by the United States of America, (ii) noncallable obligations of an
agency or instrumentality of the United States, including obligations unconditionally guaranteed
or insured by the agency or instrumentality and, on the date of their acquisition or purchase by
the City, are rated as to investment quality by a nationally recognized investment rating firm not
less than AAA or its equivalent, (iii) noncallable obligations of a state or an agency or a county,
municipality, or other political subdivision of a state that have been refunded and that, on the
date of their acquisition or purchase by the City, are rated as to investment quality by a
nationally recognized investment rating firm not less than AAA or its equivalent, and (iv) any
other then authorized securities or obligations that may be used to defease obligations such as
the Bonds under applicable laws of the State of Texas.
SECTION 13: Ordinance a Contract - Amendments - Outstanding Bonds. This
Ordinance shall constitute a contract with the Holders from time to time, be binding on the City,
and shall not be amended or repealed by the City so long as any Bond remains Outstanding
except as permitted in this Section and in Section 29 hereof. 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 holding a majority in aggregate principal amount 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 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 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 with respect to Bonds means, as of
the date of determination, all 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
57354025.5/11310082 17
(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.
SECTION 14: Covenants to Maintain Tax - Exempt Status.
(a) Definitions. When used in this Section, the following terms have the following
meanings:
"Closing Date" means the date on which the Bonds are first authenticated
and delivered to the initial purchasers against payment therefor.
"Code" means the Internal Revenue Code of 1986, as amended by all
legislation, if any, effective on or before the Closing Date.
"Computation Date" has the meaning set forth in Section 1.148 -1(b) of the
Regulations.
"Gross Proceeds" means any proceeds as defined in Section 1.148 -1(b)
of the Regulations, and any replacement proceeds as defined in Section
1.148 -1(c) of the Regulations, of the Bonds.
"Investment" has the meaning set forth in Section 1.148 -1(b) of the
Regulations.
"Nonpurpose Investment" means any investment property, as defined in
section 148(b) of the Code, in which Gross Proceeds of the Bonds are invested
and which is not acquired to carry out the governmental purposes of the Bonds.
"Rebate Amount" has the meaning set forth in Section 1.148 -1(b) of the
Regulations.
"Regulations" means any proposed, temporary, or final Income Tax
Regulations issued pursuant to Sections 103 and 141 through 150 of the Code,
and 103 of the Internal Revenue Code of 1954, which are applicable to the
Bonds. Any reference to any specific Regulation shall also mean, as
appropriate, any proposed, temporary or final Income Tax Regulation designed
to supplement, amend or replace the specific Regulation referenced.
"Yield" of (1) any Investment has the meaning set forth in Section 1.148 -5
of the Regulations and (2) the Bonds has the meaning set forth in Section 1.148-
4 of the Regulations.
(b) Not to Cause Interest to Become Taxable. The City shall not use, permit the use
of, or omit to use Gross Proceeds or any other amounts (or any property the acquisition,
construction or improvement of which is to be financed directly or indirectly with Gross
Proceeds) in a manner which if made or omitted, respectively, would cause the interest on any
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 receives 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
57354025.5/11310082 18
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.
(c) No Private Use or Private Payments. Except as permitted by section 141 of the
Code and the Regulations and rulings thereunder, the City shall at all times prior 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 or refinanced directly or
indirectly with Gross Proceeds of the Bonds (including property financed with
Gross Proceeds of the Refunded Obligations), and not use or permit the use of
such Gross Proceeds (including all contractual arrangements with terms different
than those applicable to the general public) or any property acquired, constructed
or improved with such Gross Proceeds in any activity carried on by any person or
entity (including the United States or any agency, department and instrumentality
thereof) other than a state or local government, unless such use is solely as a
member of the general public; and
(2) not directly or indirectly impose or accept any charge or other
payment by any person or entity who is treated as using Gross Proceeds of the
Bonds or any property the acquisition, construction or improvement of which is to
be financed or refinanced 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 entity 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 with such Gross Proceeds is
sold or leased to such person or entity in a transaction which creates a debt for federal income
tax purposes; (2) capacity in or service from such property is committed to such person or entity
under a take -or -pay, output or similar contract or arrangement; or (3) indirect benefits, or
burdens and benefits of ownership, of such Gross Proceeds or any property acquired,
constructed or improved with such Gross Proceeds are otherwise transferred in a transaction
which is the economic equivalent of a loan.
(e) Not to Invest at Higher Yield. Except to the extent permitted by section 148 of
the Code and the Regulations and rulings thereunder, the City shall not at any time prior to the
final Stated Maturity of the Bonds directly or indirectly invest Gross Proceeds in any Investment
(or use Gross Proceeds to replace money so invested), if as a result of such investment the
Yield from the Closing Date of all Investments acquired with Gross Proceeds (or with money
replaced thereby), whether then held or previously disposed of, exceeds the Yield of the Bonds.
(f) Not Federally Guaranteed. Except to the extent permitted by section 149(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
149(b) of the Code and the Regulations and rulings thereunder.
57354025.5/11310082 19
(g) Information Report. The City shall timely file the information required by section
149(e) of the Code with the Secretary of the Treasury on Form 8038 -G or such other form and
in such place as the Secretary may prescribe.
(h) Rebate of Arbitrage Profits. Except to the extent otherwise provided in section
148(f) of the Code and the Regulations and rulings thereunder:
(1) The City shall account for all Gross Proceeds (including all
receipts, expenditures and investments thereof) on its books of account
separately and apart from all other funds (and receipts, expenditures and
investments thereof) and shall retain all records of accounting for at least six
years after the day on which the last outstanding Bond is discharged. However,
to the extent permitted by law, the City may commingle Gross Proceeds of the
Bonds with other money of the City, provided that the City separately accounts
for each receipt and expenditure of Gross Proceeds and the obligations acquired
therewith.
(2) Not less frequently than each Computation Date, the City shall
calculate the Rebate Amount in accordance with rules set forth in section 148(f)
of the Code and the Regulations and rulings thereunder. The City shall maintain
such calculations with its official transcript of proceedings relating to the issuance
of the Bonds until six years after the final Computation Date.
(3) As additional consideration for the purchase of the Bonds by the
Purchasers (defined below) and the loan of the money represented thereby and
in order to induce such purchase by measures designed to insure 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 from the
construction fund, the general fund, or other appropriate fund or, if permitted by
applicable Texas statute, regulation or opinion of the Attorney General of the
State of Texas, the Interest and Sinking Fund, the amount that when added to
the future value of previous rebate payments made for the Bonds equals (i) in the
case of a Final Computation Date as defined in Section 1.148- 3(e)(2) of the
Regulations, one hundred percent (100 %) of the Rebate Amount on such date;
and (ii) in the case of any other Computation Date, ninety percent (90 %) of the
Rebate Amount on such date. In all cases, the rebate payments shall be made
at the times, in the installments, to the place and in the manner as is or may be
required by section 148(f) of the Code and the Regulations and rulings
thereunder, and shall be accompanied by Form 8038 -T or such other forms and
information as is or may be required by Section 148(f) of the Code and the
Regulations and rulings thereunder.
(4) The City shall exercise reasonable diligence to assure that no
errors are made in the calculations and payments required by paragraphs (2) and
(3), and if an error is made, to discover and promptly correct such error within a
reasonable amount of time thereafter (and in all events within one hundred eighty
(180) days after discovery of the error), including payment to the United States of
any additional Rebate Amount owed to it, interest thereon, and any penalty
imposed under Section 1.148 -3(h) of the Regulations.
57354025.5/11310082 20
(i) Not to Divert Arbitrage Profits. 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
earlier of the Stated Maturity or final payment of the Bonds, enter into any transaction that
reduces the amount required to be paid to the United States pursuant to Subsection h of this
Section because such transaction results in a smaller profit or a larger loss than would have
resulted if the transaction had been at arm's length and had the Yield of the Bonds not been
relevant to either party.
Q) Bonds Not Hedge Bonds. (1) At the time the original bonds refunded by the
Bonds were issued, the City reasonably expected to spend at least 85% of the spendable
proceeds of such bonds within three years after such bonds were issued and (2) not more than
50% of the proceeds of the original bonds refunded by the Bonds were invested in Nonpurpose
Investments having a substantially guaranteed Yield for a period of 4 years or more.
(k) Current Refunding. The Bonds are a current refunding of the Refunded
Obligations in that the Refunded Obligations will be paid and redeemed within ninety (90) days
of the date of the delivery of the Bonds.
(1) Elections. The City hereby directs and authorizes the Mayor, Mayor Pro Tem,
City Manager, Assistant City Manager, Director of Finance and City Secretary, individually or
jointly, to make elections permitted or required pursuant to the provisions of the Code or the
Regulations, as they deem necessary or appropriate in connection with the Bonds, in the
Certificate as to Tax Exemption or similar or other appropriate certificate, form or document.
SECTION 15: Sale of Bonds - Official Statement Approval. Pursuant to a public sale for
the Bonds, the bid submitted by Robert W. Baird & Co., Incorporated and syndicate (herein
referred to collectively as the Underwriters ") is declared to be the best bid received producing
the lowest true interest cost rate to the City, and the sale of the bonds to said Underwriters at
the price of par plus a cash premium of $475,451.50 and accrued interest, is hereby determined
to be in the best interests of the City and is approved and confirmed. Delivery of the bonds to
the Underwriters shall occur as soon as possible upon payment being made therefore in
accordance with the terms of sale. The initial Bond shall be registered in the name as provided
in the winning bid form.
Furthermore, the use of the Preliminary Official Statement by the Underwriters in
connection with the public offering and sale of the Bonds is hereby ratified, confirmed and
approved in all respects. The final Official Statement, which reflects the terms of sale (together
with such changes approved by the Mayor, Mayor Pro Tem, City Secretary, City Manager and
Director of Finance, any one or more of said officials), shall be and is hereby in all respects
approved and the Underwriters are hereby authorized to use and distribute said final Official
Statement dated October 28, 2013, in the reoffering, sale and delivery of the Bonds to the
public. The Mayor or Mayor Pro Tem, City Secretary and Assistant City Secretary are further
authorized to deliver for and on behalf of the City copies of said Official Statement in final form
as may be required by the Purchasers, and such final Official Statement in the form and content
authorized to be delivered by said officials shall be deemed to be approved by the Council and
constitute the Official Statement authorized for distribution and use by the Purchasers.
SECTION 16: Escrow Agreement Approval and Execution. The "Escrow Agreement"
(the "Agreement ") by and between the City and The Bank of New York Mellon Trust Company,
N.A., Dallas, Texas (the "Escrow Agent "), attached hereto as Exhibit B and incorporated herein
by reference as a part of this Ordinance for all purposes, is hereby approved as to form and
57354025.5/11310082 21
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 or Mayor Pro Tern and City Secretary or
Assistant City Secretary for and on behalf of the City and as the act and deed of this Council;
and such Agreement as executed by said officials shall be deemed approved by the Council
and constitute the Agreement herein approved.
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 Bond(s) pending the
approval thereof by the Attorney General, the registration thereof by the Comptroller of Public
Accounts and the delivery thereof to the Purchasers.
SECTION 18: Proceeds of Sale. Immediately following the delivery of the Bonds,
proceeds of sale in the sum of (i) $4,309,621.45 shall be deposited to the credit of the Escrow
Fund, (ii) $17,110,000 shall be deposited to the credit of the construction fund and
(iii) $96,323.38 shall be deposited to the credit of the Interest and Sinking Fund. The balance of
the proceeds of sale of the Bonds shall be expended to pay costs of issuance and any excess
amount budgeted for such purpose shall be deposited to the credit of the Interest and Sinking
Fund.
SECTION 19: Redemption of Refunded Obligations.
(a) The Series 2003 Refunded Bonds shall be redeemed and the same are hereby
called for redemption on January 07, 2014, at the price of par and accrued interest to the date of
redemption. The City Secretary or Assistant City Secretary are hereby authorized and directed
to file a copy of this Ordinance, together with a suggested form of notice of redemption to be
sent to bondholders, with The Bank of New York Mellon Trust Company, N.A. (successor
paying agent/registrar to Bank One, National Association), in accordance with the redemption
provisions applicable to such bonds; such suggested form of notice of redemption being
attached hereto as Exhibit C and incorporated herein by reference as a part of this Ordinance
for all purposes.
(b) The Series 2004 Refunded Certificates shall be redeemed and the same are
hereby called for redemption on February 15, 2014, at the price of par and accrued interest to
the date of redemption. The City Secretary or Assistant City Secretary are hereby authorized
and directed to file a copy of this Ordinance, together with a suggested form of notice of
redemption to be sent to certificate holders, with The Bank of New York Mellon Trust Company,
N.A. (successor paying agent /registrar to JPMorgan Chase Bank), in accordance with the
redemption provisions applicable to such certificates; such suggested form of notice of
redemption being attached hereto as Exhibit D and incorporated herein by reference as a part
of this Ordinance for all purposes.
(c) The Series 2004 Refunded Bonds shall be redeemed and the same are hereby
called for redemption on February 15, 2014, at the price of par and accrued interest to the date
of redemption. The City Secretary or Assistant City Secretary are hereby authorized and
directed to file a copy of this Ordinance, together with a suggested form of notice of redemption
to be sent to bondholders, with The Bank of New York Mellon Trust Company, N.A. (successor
paying agent/registrar to JPMorgan Chase Bank), in accordance with the redemption provisions
57354025.5/11310082 22
applicable to such bonds; such suggested form of notice of redemption being attached hereto
as Exhibit E and incorporated herein by reference as a part of this Ordinance for all purposes.
The redemption of the Refunded Obligations as described above being associated with
the refunding of the Refunded Obligations, the approval, authorization and arrangements herein
given and provided for the redemption of the Refunded Obligations on the redemption dates
designated therefor and in the manner provided shall be irrevocable upon the issuance and
delivery of the Bonds; and the City Secretary and Assistant City Secretary are hereby
authorized and directed to make all arrangements necessary to notify the holders of the
Refunded Obligations of the City's decision to redeem the Refunded Obligations on the dates
and in the manner herein provided and in accordance with the ordinances authorizing the
issuance of the Refunded Obligations and this Ordinance.
SECTION 20: 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 writing and sent by United 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 mail, 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, either before or after the event with 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 21: 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 22: Legal Opinion. The obligation of the Purchasers to accept delivery of the
Bonds is subject to being furnished a final opinion of Fulbright & Jaworski LLP, Attorneys,
Dallas, Texas, approving such Bonds as to their validity, said opinion to be dated and delivered
as of the date of delivery and payment for such Bonds. A true and correct reproduction of said
opinion or an executed counterpart thereof shall accompany the global Bonds deposited with
DTC or a reproduction thereof shall be printed on the definitive Bonds in the event the book -
entry -only system is discontinued.
SECTION 23: 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 attorneys approving the Bonds as to legality are to be held
responsible for CUSIP numbers incorrectly printed or typed on the definitive Bonds.
57354025.5/11310082 23
SECTION 24: Benefits of Ordinance. Nothing in this Ordinance, expressed or implied,
is intended or shall be construed to confer upon any person other than the City, 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 25: 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. With respect to the City's General Obligation
Bonds, Series 2010 issued in the original principal amount of $5,850,000, $300,000 in par
amount of such bonds should be allocated to the proposition for drainage improvements
approved by the voters at the City's bond election held on February 1, 2003. To the extent any
prior ordinances, resolutions or orders conflict with such allocation, such prior documents are
hereby modified to appropriately reflect such allocation.
SECTION 26: 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 27: Effect of Headings. The Section headings herein are for convenience
only and shall not affect the construction hereof.
SECTION 28: 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 29: Continuing Disclosure Undertaking.
(a) Definitions. As used in this Section, the following terms have the meanings
ascribed to such terms below:
"MSRB" means the Municipal Securities Rulemaking Board.
"Rule" means SEC Rule 15c2 -12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
(b) Annual Reports. The City shall provide annually to the MSRB (1) within six
months after the end of each fiscal year, beginning in or after 2011, financial information and
operating data with respect to the City of the general type included in Official Statement and
described in Exhibit F hereto, and (2) if not provided as part of such financial information and
operating data, audited financial statements of the City, when and if available. Any financial
statements so provided shall be prepared in accordance with the accounting principles
described in Exhibit F hereto, or such other accounting principles as the City may be required
to employ from time to time pursuant to state law or regulation, and audited, if the City
commissions an audit of such statements and the audit is completed within the period during
which they must be provided.
57354025.5/11310082 24
If the City changes its fiscal year, it will notify the MSRB of the change (and of the date
of the new fiscal year end) prior to the next date by which the City otherwise would be required
to provide financial information and operating data pursuant to this Section.
The financial information and operating data to be provided pursuant to this Section may
be set forth in full in one or more documents or may be included by specific reference to any
document available to the public on the MSRB's Internet Web site or filed with the SEC.
(c) Notice of Certain Events. The City shall provide notice of any of the following
events with respect to the Bonds to the MSRB in a timely manner and not more than 10
business days after occurrence of the event:
(1) Principal and interest payment delinquencies;
(2) Non - payment related defaults, if material;
(3) Unscheduled draws on debt service reserves reflecting financial difficulties;
(4) Unscheduled draws on credit enhancements reflecting financial difficulties;
(5) Substitution of credit or liquidity providers, or their failure to perform;
(6) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed
or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701 -
TEB), or other material notices or determinations with respect to the tax status of
the Bonds, or other material events affecting the tax status of the Bonds;
(7) Modifications to rights of holders of the Bonds, if material;
(8) Bond calls, if material, and tender offers;
(9) Defeasances;
(10) Release, substitution, or sale of property securing repayment of the Bonds, if
material;
(11) Rating changes;
(12) Bankruptcy, insolvency, receivership, or similar event of the City, which shall
occur as described below;
(13) The consummation of a merger, consolidation, or acquisition involving the City or
the sale of all or substantially all of its assets, other than in the ordinary course of
business, the entry into of a definitive agreement to undertake such an action or
the termination of a definitive agreement relating to any such actions, other than
pursuant to its terms, if material; and
(14) Appointment of a successor or additional trustee or the change of name of a
trustee, if material.
For these purposes, any event described in the immediately preceding subsection (c)12
is considered to occur when any of the following occur: the appointment of a receiver, fiscal
agent, or similar officer for the City in a proceeding under the United States Bankruptcy Code or
in any other proceeding under state or federal law in which a court or governmental authority
has assumed jurisdiction over substantially all of the assets or business of the City, or if such
jurisdiction has been assumed by leaving the existing governing body and officials or officers in
possession but subject to the supervision and orders of a court or governmental authority, or the
entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or
governmental authority having supervision or jurisdiction over substantially all of the assets or
business of the City.
The City shall notify the MSRB, in a timely manner, of any failure by the City to provide
financial information or operating data in accordance with subsection (b) of this Section by the
time required by such Section.
57354025.5/11310082 25
(d) Filings with the MSRB. All financial information, operating data, financial
statements, notices and other documents provided to the MSRB in accordance with this Section
shall be provided in an electronic format prescribed by the MSRB and shall be accompanied by
identifying information as prescribed by the MSRB.
(e) Limitations, Disclaimers, and Amendments. The City shall be obligated to
observe and perform the covenants specified in this Section while, but only while, the City
remains an "obligated person" with respect to the Bonds within the meaning of the Rule, except
that the City in any event will give the notice required by subsection (c) of this Section of any
Bond calls and defeasance that cause the City to be no longer such an "obligated person."
The provisions of this Section are for the sole benefit of the Holders and beneficial
owners of the Bonds, and nothing in this Section, express or implied, shall give any benefit or
any legal or equitable right, remedy, or claim hereunder to any other person. The City
undertakes to provide only the financial information, operating data, financial statements, and
notices which it has expressly agreed to provide pursuant to this Section and does not hereby
undertake to provide any other information that may be relevant or material to a complete
presentation of the City's financial results, condition, or prospects or hereby undertake to update
any information provided in accordance with this Section or otherwise, except as expressly
provided herein. The City does not make any representation or warranty concerning such
information or its usefulness to a decision to invest in or sell Bonds at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR
BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT,
FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE CITY,
WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT
SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON,
IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE
LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE.
No default by the City in observing or performing its obligations under this Section shall
constitute a breach of or default under this Ordinance for purposes of any other provision of this
Ordinance.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the
duties of the City under federal and state securities laws.
Notwithstanding anything herein to the contrary, the provisions of this Section may be
amended by the City from time to time to adapt to changed circumstances resulting from a
change in legal requirements, a change in law, or a change in the identity, nature, status, or
type of operations of the City, but only if (1) the provisions of this Section, as so amended,
would have permitted an underwriter to purchase or sell Bonds in the primary offering of the
Bonds in compliance with the Rule, taking into account any amendments or interpretations of
the Rule to the date of such amendment, as well as such changed circumstances, and (2) either
(a) the Holders of a majority in aggregate principal amount (or any greater amount required by
any other provision of this Ordinance that authorizes such an amendment) of the Outstanding
Bonds consent to such amendment or (b) a Person that is unaffiliated with the City (such as
nationally recognized bond counsel) determines that such amendment will not materially impair
the interests of the Holders and beneficial owners of the Bonds. The provisions of this Section
may also be amended from time to time or repealed by the City if the SEC amends or repeals
the applicable provisions of the Rule or a court of final jurisdiction determines that such
57354025.5/11310082 26
provisions are invalid, but only if and to the extent that reservation of the City's right to do so
would not prevent underwriters of the initial public offering of the Bonds from lawfully purchasing
or selling Bonds in such offering. If the City so amends the provisions of this Section, it shall
include with any amended financial information or operating data next provided pursuant to
subsection (b) of this Section an explanation, in narrative form, of the reasons for the
amendment and of the impact of any change in the type of financial information or operating
data so provided.
SECTION 30: 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 Council hereby
declares that this Ordinance would have been enacted without such invalid provision.
SECTION 31: Further Procedures. Any one or more of the Mayor, Mayor Pro Tem, City
Manager, Assistant City Manager, Director of Finance, City Secretary and Assistant City
Secretary are hereby expressly authorized, empowered and directed from time to time and at
any time to do and perform all such acts and things and to execute, acknowledge and deliver in
the name and on behalf of the City all agreements, instruments, certificates or other documents,
whether mentioned herein or not, as may be necessary or desirable in order to carry out the
terms and provisions of this Ordinance and the issuance, sale and delivery of the Bonds. In
addition, prior to the delivery of the Bonds, the Mayor, Mayor Pro Tem, City Manager, Assistant
City Manager, Director of Finance or Bond Counsel to the City are each hereby authorized and
directed to approve any changes or corrections to this Ordinance or to any of the documents
authorized and approved by this Ordinance: (i) in order to cure any ambiguity, formal defect, or
omission in this Ordinance or such other document, or (ii) as requested by the Attorney General
of the State of Texas or his representative to obtain the approval of the Bonds by the Attorney
General. In the event that any officer of the City whose signature shall appear on any document
shall cease to be such officer before the delivery of such document, such signature
nevertheless shall be valid and sufficient for all purposes the same as if such officer had
remained in office until such delivery.
SECTION 32: Incorporation of Findings and Determinations. The findings and
determinations of the Council contained in the preamble and recitals hereto 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.
SECTION 33: 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 the Texas Government Code, Chapter 551, as
amended.
SECTION 34: Effective Date. This Ordinance shall take effect and be in full force from
and after its adoption on the date shown below in accordance with the Texas Government
Code, Section 1201.028, as amended.
[remainder of page intentionally left blank]
57354025.5/11310082 27
PASSED AND ADOPTED, this October 28, 2013.
CITY OF NORTHRtfHLAND HILLS, TEXAS
ATTEST:
'k 7w o a: / V6 �
City Secretary
APPROVED AS TO LEGALITY:
Director of F' ance
57354025.5/11310082 S-1
EXHIBIT A
PAYING AGENT /REGISTRAR AGREEMENT
See Attached
57354025.5/11310082 A-
PAYING AGENT /REGISTRAR AGREEMENT
THIS AGREEMENT is entered into as of October 28, 2013 (this "Agreement "), by and
between The Bank of New York Mellon Trust Company, N.A., Dallas, Texas, a banking
association duly organized and existing under the laws of the United States of America (the
"Bank ") and the City of North Richland Hills, Texas (the "Issuer").
RECITALS
WHEREAS, the Issuer has duly authorized and provided for the issuance of its "City of
North Richland Hills, Texas, General Obligation Refunding and Improvement Bonds,
Series 2013 ", dated October 15, 2013 (the "Securities "), such Securities scheduled to be
delivered to the initial purchasers thereof on or about December 3, 2013; and
WHEREAS, the Issuer has selected the Bank to serve as Paying Agent/Registrar in
connection with the payment of the principal of, premium, if any, and interest on said Securities
and with respect to the registration, transfer and exchange thereof by the registered owners
thereof; and
WHEREAS, the Bank has agreed to serve in such capacities for and on behalf of the
Issuer and has full power and authority to perform and serve as Paying Agent /Registrar for the
Securities;
NOW, THEREFORE, it is mutually agreed as follows:
ARTICLE ONE
APPOINTMENT OF BANK AS PAYING AGENT AND REGISTRAR
Section 1.01 Appointment. The Issuer hereby appoints the Bank to serve as Paying
Agent with respect to the Securities, and, as Paying Agent for the Securities, the Bank shall be
responsible for paying on behalf of the Issuer the principal, premium (if any), and interest on the
Securities as the same become due and payable to the registered owners thereof; all in
accordance with this Agreement and the "Authorizing Document" (hereinafter defined). The
Issuer hereby appoints the Bank as Registrar with respect to the Securities and, as Registrar for
the Securities, the Bank shall keep and maintain for and on behalf of the Issuer books and
records as to the ownership of said Securities and with respect to the transfer and exchange
thereof as provided herein and in the Authorizing Document.
The Bank hereby accepts its appointment, and agrees to serve as the Paying Agent and
Registrar for the Securities.
Section 1.02 Compensation. As compensation for the Bank's services as Paying
Agent /Registrar, the Issuer hereby agrees to pay the Bank the fees and amounts set forth in
Annex A attached hereto.
In addition, the Issuer agrees to reimburse the Bank upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Bank in accordance with any
of the provisions hereof (including the reasonable compensation and the expenses and
disbursements of its agents and counsel).
79067328.1/11310082
ARTICLE TWO
DEFINITIONS
Section 2.01 Definitions. For all purposes of this Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
"Acceleration Date" on any Security means the date, if any, on and after
which the principal or any or all installments of interest, or both, are due and
payable on any Security which has become accelerated pursuant to the terms of
the Security.
"Authorizing Document" means the resolution, order, or ordinance of the
governing body of the Issuer pursuant to which the Securities are issued, as the
same may be amended or modified, including any pricing certificate related
thereto, certified by the secretary or any other officer of the Issuer and delivered
to the Bank.
"Bank Office" means the designated office of the Bank at the address
shown in Section 3.01 hereof. The Bank will notify the Issuer in writing of any
change in location of the Bank Office.
"Financial Advisor" means First Southwest Company.
"Holder" and "Security Holder" each means the Person in whose name a
Security is registered in the Security Register.
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision of a government.
"Predecessor Securities" of any particular Security means every previous
Security evidencing all or a portion of the same obligation as that evidenced by
such particular Security (and, for the purposes of this definition, any mutilated,
lost, destroyed, or stolen Security for which a replacement Security has been
registered and delivered in lieu thereof pursuant to Section 4.06 hereof and the
Authorizing Document).
"Redemption Date ", when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to the terms of the
Authorizing Document.
"Responsible Officer ", when used with respect to the Bank, means the
Chairman or Vice - Chairman of the Board of Directors, the Chairman or
Vice - Chairman of the Executive Committee of the Board of Directors, the
President, any Vice President, the Secretary, any Assistant Secretary, the
Treasurer, any Assistant Treasurer, the Cashier, any Assistant Cashier, any
Trust Officer or Assistant Trust Officer, or any other officer of the Bank
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
79067328.1/11310082 2
"Security Register" means a register maintained by the Bank on behalf of
the Issuer providing for the registration and transfers of Securities.
"Stated Maturity" means the date specified in the Authorizing Document
the principal of a Security is scheduled to be due and payable.
Section 2.02 Other Definitions. The terms "Bank," "Issuer," and "Securities
(Security)" have the meanings assigned to them in the recital paragraphs of this Agreement.
The term "Paying Agent/Registrar" refers to the Bank in the performance of the duties
and functions of this Agreement.
ARTICLE THREE
PAYING AGENT
Section 3.01 Duties of Paving Agent. As Paying Agent, the Bank shall pay, provided
adequate collected funds have been provided to it for such purpose by or on behalf of the
Issuer, on behalf of the Issuer the principal of each Security at its Stated Maturity, Redemption
Date or Acceleration Date, to the Holder upon surrender of the Security to the Bank at the
following address:
First Class /Registered /Certified Express Delivery /Courier
The Bank of New York Mellon
Trust Company, N.A.
Global Corporate Trust
P.O. Box 396
East Syracuse, NY 13057
The Bank of New York Mellon
Trust Company, N.A.
Global Corporate Trust
111 Sanders Creek Pkwy.
East Syracuse, NY 13057
By Hand Only
The Bank of New York Mellon
Trust Company, N.A.
Global Corporate Trust
Corporate Trust Window
101 Barclay Street, 1 st Floor East
New York, NY 10286
As Paying Agent, the Bank shall, provided adequate collected funds have been provided
to it for such purpose by or on behalf of the Issuer, pay on behalf of the Issuer the interest on
each Security when due, by computing the amount of interest to be paid each Holder and
making payment thereof to the Holders of the Securities (or their Predecessor Securities) on the
Record Date (as defined in the Authorizing Document). All payments of principal and /or interest
on the Securities to the registered owners shall be accomplished (1) by the issuance of checks,
payable to the registered owners, drawn on the paying agent account provided in Section 5.05
hereof, sent by United States mail, first class postage prepaid, to the address appearing on the
Security Register or (2) by such other method, acceptable to the Bank, requested in writing by
the Holder at the Holder's risk and expense.
Section 3.02 Payment Dates. The Issuer hereby instructs the Bank to pay the
principal of and interest on the Securities on the dates specified in the Authorizing Document.
ARTICLE FOUR
REGISTRAR
Section 4.01 Security Register - Transfers and Exchanges. The Bank agrees to
keep and maintain for and on behalf of the Issuer at the Bank Office books and records (herein
sometimes referred to as the "Security Register ") for recording the names and addresses of the
Holders of the Securities, the transfer, exchange and replacement of the Securities and the
payment of the principal of and interest on the Securities to the Holders and containing such
79067328.1/11310082 3
other information as may be reasonably required by the Issuer and subject to such reasonable
regulations as the Issuer and the Bank may prescribe. All transfers, exchanges and
replacements of Securities shall be noted in the Security Register.
Every Security surrendered for transfer or exchange shall be duly endorsed or be
accompanied by a written instrument of transfer, the signature on which has been guaranteed
by an officer of a federal or state bank or a member of the National Association of Securities
Dealers, such written instrument to be in a form satisfactory to the Bank and duly executed by
the Holder thereof or his agent duly authorized in writing.
The Bank may request any supporting documentation it feels necessary to effect a
re- registration, transfer or exchange of the Securities.
To the extent possible and under reasonable circumstances, the Bank agrees that, in
relation to an exchange or transfer of Securities, the exchange or transfer by the Holders thereof
will be completed and new Securities delivered to the Holder or the assignee of the Holder in
not more than three (3) business days after the receipt of the Securities to be cancelled in an
exchange or transfer and the written instrument of transfer or request for exchange duly
executed by the Holder, or his duly authorized agent, in form and manner satisfactory to the
Paying Agent /Registrar.
Section 4.02 Securities. The Issuer shall provide additional Securities when needed
to facilitate transfers or exchanges thereof. The Bank covenants that such additional Securities,
if and when provided, will be kept in safekeeping pending their use and reasonable care will be
exercised by the Bank in maintaining such Securities in safekeeping, which shall be not less
than the care maintained by the Bank for debt securities of other governments or corporations
for which it serves as registrar, or that is maintained for its own securities.
Section 4.03 Form of Security Register. The Bank, as Registrar, will maintain the
Security Register relating to the registration, payment, transfer and exchange of the Securities
in accordance with the Bank's general practices and procedures in effect from time to time. The
Bank shall not be obligated to maintain such Security Register in any form other than those
which the Bank has currently available and currently utilizes at the time.
The Security Register may be maintained in written form or in any other form capable of
being converted into written form within a reasonable time.
Section 4.04 List of Security Holders. The Bank will provide the Issuer at any time
requested by the Issuer, upon payment of the required fee, a copy of the information contained
in the Security Register. The Issuer may also inspect the information contained in the Security
Register at any time the Bank is customarily open for business, provided that reasonable time is
allowed the Bank to provide an up -to -date listing or to convert the information into written form.
The Bank will not release or disclose the contents of the Security Register to any person
other than to, or at the written request of, an authorized officer or employee of the Issuer, except
upon receipt of a court order or as otherwise required by law. Upon receipt of a court order and
prior to the release or disclosure of the contents of the Security Register, the Bank will notify the
Issuer so that the Issuer may contest the court order or such release or disclosure of the
contents of the Security Register.
79067328.1/11310082 4
Section 4.05 Return of Cancelled Securities. The Bank will, at such reasonable
intervals as it determines, surrender to the Issuer, all Securities in lieu of which or in exchange
for which other Securities have been issued, or which have been paid.
Section 4.06 Mutilated, Destroyed, Lost or Stolen Securities. The Issuer hereby
instructs the Bank, subject to the provisions of the Authorizing Document, to deliver and issue
Securities in exchange for or in lieu of mutilated, destroyed, lost, or stolen Securities as long as
the same does not result in an overissuance.
In case any Security shall be mutilated, destroyed, lost or stolen, the Bank may execute
and deliver a replacement Security of like form and tenor, and in the same denomination and
bearing a number not contemporaneously outstanding, in exchange and substitution for such
mutilated Security, or in lieu of and in substitution for such mutilated, destroyed, lost or stolen
Security, only upon the approval of the Issuer and after (i) the filing by the Holder thereof with
the Bank of evidence satisfactory to the Bank of the destruction, loss or theft of such Security,
and of the authenticity of the ownership thereof and (ii) the furnishing to the Bank of
indemnification in an amount satisfactory to hold the Issuer and the Bank harmless. All
expenses and charges associated with such indemnity and with the preparation, execution and
delivery of a replacement Security shall be borne by the Holder of the Security mutilated,
destroyed, lost or stolen.
Section 4.07 Transaction Information to Issuer. The Bank will, within a reasonable
time after receipt of written request from the Issuer, furnish the Issuer information as to the
Securities it has paid pursuant to Section 3.01, Securities it has delivered upon the transfer or
exchange of any Securities pursuant to Section 4.01, and Securities it has delivered in
exchange for or in lieu of mutilated, destroyed, lost, or stolen Securities pursuant to
Section 4.06.
ARTICLE FIVE
THE BANK
Section 5.01 Duties of Bank. The Bank undertakes to perform the duties set forth
herein and agrees to use reasonable care in the performance thereof.
Section 5.02 Reliance on Documents, Etc.
(a) The Bank may conclusively rely, as to the truth of the statements and
correctness of the opinions expressed therein, on certificates or opinions furnished to the Bank.
(b) The Bank shall not be liable for any error of judgment made in good faith by a
Responsible Officer, unless it shall be proved that the Bank was negligent in ascertaining the
pertinent facts.
(c) No provisions of this Agreement shall require the Bank to expend or risk its own
funds or otherwise incur any financial liability for performance of any of its duties hereunder, or
in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity satisfactory to it against such risks or
liability is not assured to it.
(d) The Bank may rely and shall be protected in acting or refraining from acting upon
any resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
79067328.1/11310082 5
consent, order, bond, note, security or other paper or document believed by it to be genuine and
to have been signed or presented by the proper party or parties. Without limiting the generality
of the foregoing statement, the Bank need not examine the ownership of any Securities, but is
protected in acting upon receipt of Securities containing an endorsement or instruction of
transfer or power of transfer which appears on its face to be signed by the Holder or an agent
of the Holder. The Bank shall not be bound to make any investigation into the facts or matters
stated in a resolution, certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, note, security or other paper or document supplied by the
Issuer.
(e) The Bank may consult with counsel, and the written advice of such counsel or
any opinion of counsel shall be full and complete authorization and protection with respect to
any action taken, suffered, or omitted by it hereunder in good faith and in reliance thereon.
(f) The Bank may exercise any of the powers hereunder and perform any duties
hereunder either directly or by or through agents or attorneys of the Bank.
(g) The Bank is also authorized to transfer funds relating to the closing and initial
delivery of the Securities in the manner disclosed in the closing memorandum or letter as
prepared by the Issuer, the Financial Advisor or other agent. The Bank may act on a facsimile
or e-mail transmission of the closing memorandum or letter acknowledged by the Issuer, the
Issuer's financial advisor or other agent as the final closing memorandum or letter. The Bank
shall not be liable for any losses, costs or expenses arising directly or indirectly from the Bank's
reliance upon and compliance with such instructions.
Section 5.03 Recitals of Issuer. The recitals contained herein with respect to the
Issuer and in the Securities shall be taken as the statements of the Issuer, and the Bank
assumes no responsibility for their correctness.
The Bank shall in no event be liable to the Issuer, any Holder or Holders of any Security,
or any other Person for any amount due on any Security from its own funds.
Section 5.04 May Hold Securities. The Bank, in its individual or any other capacity,
may become the owner or pledgee of Securities and may otherwise deal with the Issuer with the
same rights it would have if it were not the Paying Agent/Registrar, or any other agent.
Section 5.05 Moneys Held by Bank - Paving Agent Account/Collateralization. A
paying agent account shall at all times be kept and maintained by the Bank for the receipt,
safekeeping, and disbursement of moneys received from the Issuer under this Agreement for
the payment of the Securities, and money deposited to the credit of such account until paid to
the Holders of the Securities shall be continuously collateralized by securities or obligations
which qualify and are eligible under both the laws of the State of Texas and the laws of the
United States of America to secure and be pledged as collateral for paying agent accounts to
the extent such money is not insured by the Federal Deposit Insurance Corporation. Payments
made from such paying agent account shall be made by check drawn on such account unless
the owner of the Securities shall, at its own expense and risk, request an alternative method of
payment.
Subject to the applicable unclaimed property laws of the State of Texas, any money
deposited with the Bank for the payment of the principal of, premium (if any), or interest on any
Security and remaining unclaimed for three years after final maturity of the Security has become
79067328.1/11310082 6
due and payable will be held by the Bank and disposed of only in accordance with Title 6 of the
Texas Property Code, as amended. The Bank shall have no liability by virtue of actions taken in
compliance with this provision.
The Bank is not obligated to pay interest on any money received by it under this
Agreement.
This Agreement relates solely to money deposited for the purposes described herein,
and the parties agree that the Bank may serve as depository for other funds of the Issuer, act as
trustee under indentures authorizing other bond transactions of the Issuer, or act in any other
capacity not in conflict with its duties hereunder.
Section 5.06 Indemnification. To the extent permitted by law, the Issuer agrees to
indemnify the Bank for, and hold it harmless against, any loss, liability, or expense incurred
without negligence or bad faith on its part, arising out of or in connection with its acceptance or
administration of its duties hereunder, including the cost and expense against any claim or
liability in connection with the exercise or performance of any of its powers or duties under this
Agreement.
Section 5.07 Interpleader. The Issuer and the Bank agree that the Bank may seek
adjudication of any adverse claim, demand, or controversy over its person as well as funds on
deposit, in either a Federal or State District Court located in the state and county where the
administrative office of the Issuer is located, and agree that service of process by certified or
registered mail, return receipt requested, to the address referred to in Section 6.03 of this
Agreement shall constitute adequate service. The Issuer and the Bank further agree that the
Bank has the right to file a Bill of Interpleader in any court of competent jurisdiction in the State
of Texas to determine the rights of any Person claiming any interest herein.
In the event the Bank becomes involved in litigation in connection with this Section, the
Issuer, 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.
The obligations of the Bank under this Agreement shall be performable at the principal
corporate office of the Bank in the City of Dallas, Texas.
Section 5.08 DTC Services. It is hereby represented and warranted that, in the event
the Securities are otherwise qualified and accepted for "Depository Trust Company" services or
equivalent depository trust services by other organizations, the Bank has the capability and, to
the extent within its control, will comply with the "Operational Arrangements ", which establishes
requirements for securities to be eligible for such type depository trust services, including, but
not limited to, requirements for the timeliness of payments and funds availability, transfer
turnaround time, and notification of redemptions and calls.
ARTICLE SIX
MISCELLANEOUS PROVISIONS
Section 6.01 Amendment. This Agreement may be amended only by an agreement in
writing signed by both of the parties hereto.
Section 6.02 Assignment. This Agreement may not be assigned by either party
without the prior written consent of the other.
79067328.1/11310082 7
Section 6.03 Notices. Any request, demand, authorization, direction, notice, consent,
waiver, or other document provided or permitted hereby to be given or furnished to the Issuer or
the Bank shall be mailed or delivered to the Issuer or the Bank, respectively, at the addresses
shown on the signature page hereof.
Section 6.04 Effect of Headings. The Article and Section headings herein are for
convenience of reference only and shall not affect the construction hereof.
Section 6.05 Successors and Assigns. All covenants and agreements herein by the
Issuer shall bind its successors and assigns, whether so expressed or not.
Section 6.06 Severability. In case any provision herein 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.
Section 6.07 Merger, Conversion, Consolidation, or Succession. Any corporation
or association into which the Bank may be merged or converted or with which it may be
consolidated, or any corporation or association resulting from any merger, conversion, or
consolidation to which the Bank shall be a party, or any corporation or association succeeding
to all or substantially all of the corporate trust business of the Bank shall be the successor of the
Bank as Paying Agent under this Agreement without the execution or filing of any paper or any
further act on the part of either parties hereto.
Section 6.08 Benefits of Agreement. Nothing herein, express or implied, shall give to
any Person, other than the parties hereto and their successors hereunder, any benefit or any
legal or equitable right, remedy, or claim hereunder.
Section 6.09 Entire Agreement. This Agreement and the Authorizing Document
constitute the entire agreement between the parties hereto relative to the Bank acting as Paying
Agent/Registrar and if any conflict exists between this Agreement and the Authorizing
Document, the Authorizing Document shall govern.
Section 6.10 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall constitute one
and the same Agreement.
Section 6.11 Termination. This Agreement will terminate (i) on the date of final
payment of the principal of and interest on the Securities to the Holders thereof or (ii) may be
earlier terminated by either party upon sixty (60) days written notice; provided, however, an
early termination of this Agreement by either party shall not be effective until (a) a successor
Paying Agent /Registrar has been appointed by the Issuer and such appointment accepted and
(b) notice has been given to the Holders of the Securities of the appointment of a successor
Paying Agent/Registrar. However, if the Issuer fails to appoint a successor Paying
Agent/Registrar within a reasonable time, the Bank may petition a court of competent
jurisdiction within the State of Texas to appoint a successor. Furthermore, the Bank and the
Issuer mutually agree that the effective date of an early termination of this Agreement shall not
occur at any time which would disrupt, delay or otherwise adversely affect the payment of the
Securities.
Upon an early termination of this Agreement, the Bank agrees to promptly transfer and
deliver the Security Register (or a copy thereof), together with the other pertinent books and
79067328.1/11310082 8
records relating to the Securities, to the successor Paying Agent/Registrar designated and
appointed by the Issuer.
The provisions of Section 1.02 and of Article Five shall survive and remain in full force
and effect following the termination of this Agreement.
Section 6.12 Governing Law. This Agreement shall be construed in accordance with
and governed by the laws of the State of Texas.
[The remainder of this page intentionally left blank.]
79067328.1/11310082 9
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
THE BANK OF NEW YORK MELLON TRUST
COMPANY, N.A., Dallas, Texas
la
Title:
Address: 2001 Bryan Street, 11th Floor
Dallas, Texas 75201
Attest:
Title:
79067328.1/11310082 S-1
CITY OF NORTH RICHLAND HILLS, TEXAS
Mayor
ATTEST:
City Secretary
79067328.1/11310082 S -2
ANNEX A
79067328.1/11310082 A-1
EXHIBIT B
ESCROW AGREEMENT
See Attached
57354025.5/11310082 B-1
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (the "Agreement "), dated and made effective as of
October 28, 2013 by and between the City of North Richland Hills, Texas (the "City "), and The
Bank of New York Mellon Trust Company, N.A., a banking association organized and existing
under the laws of the United States of America, or its successor (the "Escrow Agent').
WITNESSETH:
WHEREAS, the City Council of the City has heretofore issued, sold and delivered, and
there is currently outstanding obligations of the following issue or series, totaling in principal
amount of $4,220,000 (collectively, the "Refunded Obligations ") more particularly described as
follows:
(a) City of North Richland Hills, Texas, General Obligation Bonds, Series
2003, dated April 15, 2003, scheduled to mature on February 15, 2015,
aggregating in the principal amount of $140,000 (the "Series 2003 Refunded
Bonds ");
(b) City of North Richland Hills, Texas, Tax and Waterworks and Sewer
System Surplus Revenue Certificates of Obligation, Series 2004, dated April 15,
2004, being a portion of such certificates scheduled to mature on February 15 in
each of the years 2015 through 2019, aggregating in the principal amount of
$225,000 (the "Series 2004 Refunded Certificates "); and
(c) City of North Richland Hills, Texas, General Obligation Refunding and
Improvement Bonds, Series 2004, dated April 15, 2004, being a portion of such
bonds scheduled to mature on February 15 in each of the years 2015 through
2024, aggregating in the principal amount of $3,855,000 (the "Series 2004
Refunded Bonds ").
WHEREAS, in accordance with the provisions of Texas Government Code,
Chapter 1207, as amended (the "Act'), the City is authorized to sell refunding bonds in an
amount sufficient to provide for the full and complete payment of obligations, deposit the
proceeds of such refunding bonds with the place of payment for the obligations being refunded,
or other authorized depository, and enter into an escrow or similar 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; and
WHEREAS, the City on the 28th day of October, 2013, pursuant to an ordinance (the
"Bond Ordinance ") finally passed and adopted by the City Council, authorized the issuance of
bonds known as "City of North Richland Hills, Texas, General Obligation Refunding and
Improvement Bonds, Series 2013" (the "Bonds "), and such Bonds are being issued to refund,
discharge and make final payment of the principal of and interest on the Refunded Bonds
pursuant to the Bond Ordinance; and
WHEREAS, proceeds of sale of the Bonds are to be deposited with the Escrow Agent
under this Agreement, which deposit of funds will be sufficient to pay and redeem in full the
(i) Series 2003 Refunded Bonds on January 7, 2014 and (ii) Series 2004 Refunded Bonds and
Series 2004 Refunded Certificates on February 15, 2014 (hereinafter referred to collectively as
the "Payment Dates ");
57377620.1/11310082
NOW, THEREFORE, in consideration of the mutual agreements herein contained and
the payment to the Escrow Agent of the amounts provided in Section 9 hereof, and to secure
the payment of the principal of and the interest on the Refunded Bonds, the City and the Escrow
Agent hereby agree as follows:
SECTION 1: There is hereby created by the City with the Escrow Agent a special
segregated and irrevocable trust fund designated "CITY OF NORTH RICHLAND HILLS,
TEXAS, SERIES 2013 GENERAL OBLIGATION REFUNDING AND IMPROVEMENT BOND
ESCROW FUND" (hereinafter called the "Escrow Fund ") for the benefit of the holders of the
Refunded Bonds, and, immediately following the delivery of the Bonds, the City agrees and
covenants to cause to be deposited with the Escrow Agent for the credit of the Escrow Fund the
sum of $4,309,621.45. The Escrow Agent, as paying agent for the Refunded Bonds, represents
that such amount will be sufficient to pay and redeem in full all the Refunded Bonds on the
Payment Dates by reason of redemption.
The Escrow Agent agrees to establish such Escrow Fund and further agrees to receive
said moneys, apply the same as set forth herein, and to hold the cash deposited and credited to
the Escrow Fund for application and disbursement for the payment and redemption of the
Refunded Bonds on the respective Payment Dates.
SECTION 2: The Escrow Agent acknowledges receipt of a copy of the Bond Ordinance
which provides for the redemption of the Refunded Bonds on the Payment Dates at the price of
par plus accrued interest to the date of redemption and as paying agent for the Refunded Bonds
agrees to cause notices of redemption pertaining to the Refunded Bonds to be sent to the
registered owners thereof appearing on the registration books at least thirty (30) days prior to
the redemption dates therefor.
SECTION 3: The Escrow Agent agrees that all funds and /or investments held in the
Escrow Fund shall constitute dedicated interest and sinking funds for the payment of the
principal of and interest on the Refunded Bonds which will mature and become due on and after
the date of this Agreement, and such funds deposited to the credit of the Escrow Fund shall be
applied solely in accordance with the provisions of this Agreement and the City shall have no
right or title with respect thereto, except as otherwise provided herein. Such funds shall not be
subject to checks or drafts drawn by the City.
SECTION 4: If, for any reason, the funds on hand in the Escrow Fund shall be
insufficient to pay the redemption price of the Refunded Bonds on the Payment Date, the City
shall timely deposit to the credit of the Escrow Fund, from lawfully available funds, additional
funds in the amounts required to make such payment. Notice of any such insufficiency shall be
immediately given by the Escrow Agent to the City by the fastest means possible, but the
Escrow Agent shall in no manner be responsible for the City's failure to make such deposit.
SECTION 5: The Escrow Agent represents that the deposit covered by this Agreement
shall constitute firm banking arrangements to insure payment of the Refunded Bonds, and funds
deposited to the credit of the Escrow Fund shall be collateralized, in the par or face amount
equal to the amount on deposit in such Account and not otherwise covered by the Federal
Deposit Insurance Corporation.
57377620.1/11310082 2
SECTION 6: The Escrow Agent shall, without further direction from anyone, including
the City, cause to be withdrawn from the Escrow Fund the amount required to pay the principal
and accrued interest on the Refunded Bonds due and payable on the Payment Date and the
amount withdrawn from the Escrow Fund shall be immediately transmitted and deposited with
the paying agent for the Refunded Bonds to be paid with such amount. The paying agent for
the Refunded Bonds is the Escrow Agent.
SECTION 7: The Escrow Agent shall have no lien whatsoever upon any of the moneys
deposited to the credit of the Escrow Fund for payment of services rendered hereunder, or for
any costs or expenses incurred hereunder and reimbursable from the City.
SECTION 8: Pending the disbursement of moneys held in the Escrow Fund, amounts
deposited to the credit of the Escrow Fund may be invested at the direction of the City in direct
obligations of the United States of America which mature on or before the Payment Date and
are not subject to prior redemption. Absent written instructions from the City, the funds in the
Escrow Fund will remain uninvested. All earnings realized from the investment of such funds, if
any, will be immediately remitted to the City following the receipt thereof by the Escrow Agent.
No investment of funds deposited to the credit of the Escrow Fund shall be made on or after the
Payment Date. Except as authorized and permitted in this Section, neither the City nor the
Escrow Agent shall invest any moneys deposited in the Escrow Fund.
SECTION 9: The City agrees to pay the Escrow Agent for the performance of services
hereunder and as reimbursement for anticipated expenses to be incurred hereunder the amount
of $500 and, except for reimbursement of costs and expenses incurred by the Escrow Agent
pursuant to Sections 2 and 11 hereof, the Escrow Agent hereby agrees said amount is full and
complete payment for the administration of this Agreement.
The City also agrees to deposit with the Escrow Agent on the date of the delivery of the
Bonds, the sum of $900, which represents the total charge due the Escrow Agent as paying
agent for the Refunded Bonds and the Escrow Agent acknowledges and agrees that above
amount is and represents the total amount of compensation due the Escrow Agent for services
rendered as paying agent for the Refunded Bonds. The Escrow Agent 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 Bonds.
SECTION 10: The Escrow Agent shall not be responsible for any recital herein, except
with respect to its organization, its powers and authority and to the safety and security of the
deposit of funds to be made by the City hereunder. 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 Escrow Agent shall be entitled to rely upon a certificate
signed on behalf of the City by its City Secretary as sufficient evidence of the facts therein
contained. The Escrow Agent may accept a certificate of the City Secretary under the City'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 Escrow Agent shall be determined solely by the
express provisions of this Agreement and the Escrow Agent 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 Escrow Agent.
57377620.1/11310082 3
In the absence of bad faith on the part of the Escrow Agent, the Escrow Agent 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 Escrow Agent, conforming to
the requirements of this Agreement; but notwithstanding 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 Escrow Agent, the Escrow Agent shall be
under a duty to examine the same to determine whether it conforms to the requirements of this
Agreement.
The Escrow Agent shall not be liable for any error of judgment made in good faith by a
Responsible Officer or Officers of the Escrow Agent unless it shall be proved that the Escrow
Agent was negligent in ascertaining or acting upon the pertinent facts. The Escrow Agent shall
not be responsible or liable to any person in any manner whatever for the sufficiency,
correctness, genuineness, effectiveness, or validity of the deposits made pursuant to this
Agreement, or for the form or execution thereof, or for the identity or authority of any person
making or executing such deposits.
The term "Responsible Officers" of the Escrow Agent, 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, and every other officer and assistant officer of the Escrow Agent
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", when
used with respect to the Escrow Agent, means the officer in the corporate trust department of
the Escrow Agent having direct responsibility for administration of this Agreement.
None of the provisions of this Agreement shall require the Escrow Agent to expend or
risk its own funds or otherwise to incur any liability, financial or otherwise, in the performance of
any of its duties hereunder.
To the extent permitted by law, the City shall indemnify, defend and hold harmless the
Escrow Agent and its officers, directors, employees, representatives and agents, from and
against and reimburse the Escrow Agent for any and all claims, obligations, liabilities, losses,
damages, actions, suits, judgments, reasonable costs and expenses (including reasonable
attorneys' and agents' fees and expenses) of whatever kind or nature regardless of their merit,
demanded, asserted or claimed against the Escrow Agent directly or indirectly relating to, or
arising from, claims against the Escrow Agent by reason of its participation in the transactions
contemplated hereby, except to the extent caused by the Escrow Agent's negligence or willful
misconduct. The foregoing indemnity shall survive the termination of this Agreement or the
earlier resignation or removal of the Escrow Agent.
SECTION 11: This Agreement is between the City and the Escrow Agent only and in
connection therewith the Escrow Agent 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 this City's right and power to execute and deliver this Agreement, and the
Escrow Agent shall not be liable in any manner as a result of such reliance. The duty of the
Escrow Agent hereunder shall only be to the City and the holders of the Refunded Bonds. In
the event conflicting demands or notices are made upon the Escrow Agent growing out of or
relating to this Agreement or the Escrow Agent in good faith is in doubt as to what action should
be taken hereunder, the Escrow Agent shall have the right at its election to:
57377620.1/11310082 4
(a) Withhold and stop all further proceedings in, and
performance of, this Agreement with respect to the issue in question and of all
instructions received hereunder in regard to such issue; and
(b) File a suit in interpleader and obtain an order from a court
of appropriate jurisdiction in the State of Texas requiring all persons involved to
interplead and litigate in such court their several claims and rights among
themselves.
In the event the Escrow Agent becomes involved in litigation in connection with this
Section, the City, to the extent permitted by law, agrees to indemnify and save the Escrow
Agent harmless from all loss, cost, damages, expenses and attorney fees suffered or incurred
by the Escrow Agent as a result thereof. The obligations of the Escrow Agent under this
Agreement shall be performable at the principal corporate office of the Escrow Agent in the City
of Dallas, Texas.
The Escrow Agent may advise with legal counsel in the event of any dispute or question
regarding the construction of any of the provisions hereof or its duties hereunder, and in the
absence of negligence or bad faith on the part of the Escrow Agent, no liability shall be incurred
by the Escrow Agent for any action taken pursuant to this Section and the Escrow Agent shall
be fully protected in acting in accordance with the opinion and instructions of legal counsel that
is knowledgeable and has expertise in the field of law addressed in any such legal opinion or
with respect to the instructions given.
SECTION 12: Time shall be of the essence in the performance of obligations from time
to time imposed upon the Escrow Agent by this Agreement.
SECTION 13: Following the final payment and redemption of the Refunded Bonds, the
Escrow Agent shall forward by letter to the City, to the attention of the City Manager or the
Director of Finance, or other designated official of the City, a final accounting statement with
respect to the payment and discharge of the Refunded Bonds. The Escrow Agent shall treat all
cancelled bonds in accordance with the Escrow Agent's retention policy.
SECTION 14: 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 upon receipt
when mailed by registered or certified mail, postage prepaid addressed as follows:
CITY OF NORTH RICHLAND HILLS
7301 NE Loop 820
North Richland Hills, Texas 76180
Attention: Director of Finance
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.
2001 Bryan Street, 11th Floor
Dallas, Texas 75201
Attention: Issuer Administrative Services
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.
57377620.1/11310082 5
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 15: Whenever under the terms of this Agreement the performance date of
any provision hereof, including the date of maturity of interest on or principal of the Refunded
Bonds, shall be a Sunday or a legal holiday or a day on which the Escrow Agent is authorized
by law to close, then the performance thereof, including the payment of principal of and interest
on the Refunded Bonds, need not be made on such date but may performed or paid, as the
case may be, on the next succeeding business day of the Escrow Agent with 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 16: 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 Bond as executed, authenticated and delivered and in all proceedings
pertaining thereto as said Refunded Bonds 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 Bonds as provided herein and the execution and delivery of this Agreement
have been duly and effectively taken and that said Refunded Bonds 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 17: If any one 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 18: This Agreement shall terminate either (i) when the Refunded Bonds and
coupons appertaining thereto have been paid and discharged in accordance with the provisions
of this Agreement or (ii) at the expiration of three (3) years after the last Payment Date,
whichever circumstance shall first occur. Subject to applicable unclaimed property laws of the
State, moneys held in the Escrow Fund at the termination of this Agreement shall be remitted
and transferred to the City.
SECTION 19: Neither the City nor the Escrow Agent 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 20: Any corporation or association into which the Escrow Agent may be
merged or converted or with which it may be consolidated, or any corporation or association
resulting from any merger, conversion, or consolidation to which the Escrow Agent shall be a
party, or any corporation or association succeeding to all or substantially all of the corporate
trust business of the Escrow Agent shall be the successor of the Escrow Agent under this
Agreement without the execution or filing of any paper or any further act on the part of either
parties hereto.
SECTION 21: This Agreement shall inure to the benefit of and be binding upon the
Escrow Agent and the City and their respective successors.
57377620.1/11310082 6
SECTION 22: 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.
SECTION 23: This Agreement shall be governed by the laws of the State of Texas.
[The remainder of this page intentionally left blank.]
57377620.1/11310082 7
IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be
executed by their duly authorized officers and attested as of the date first above written.
CITY OF NORTH RICHLAND HILLS, TEXAS
Mayor
ATTEST:
City Secretary
[signature page to Escrow Agreement — signatures continue on next page]
57377620.1/11310082 S-1
ATTEST:
Title:
THE BANK OF NEW YORK MELLON TRUST
COMPANY, N.A., Dallas, Texas, as escrow agent
Title:
[signature page to Escrow Agreement]
57377620.1/11310082 S -2
EXHIBIT C
NOTICE OF REDEMPTION
CITY OF NORTH RICHLAND HILLS, TEXAS
GENERAL OBLIGATION BONDS
SERIES 2003
Dated April 15, 2003
NOTICE IS HEREBY GIVEN that the bonds of the above series maturing on February
15, 2015 and aggregating in the principal amount of $140,000 have been called for redemption
on January 07, 2014 at the redemption price of par and accrued interest to the date of
redemption, such bonds being identified as follows:
Year of
Principal CUSIP
Maturity
Amount Number
2015
$140,000
ALL SUCH BONDS shall become due and payable on January 07, 2014, and interest
thereon shall cease to accrue from and after said redemption date and payment of the
redemption price of said bonds shall be paid to the registered owners thereof only upon
presentation and surrender of such bonds to The Bank of New York Mellon Trust Company,
N.A. (as successor paying agent /registrar to Bank One, National Association), at its designated
offices at the following addresses:
First Class/
Reg istered /Certified
The Bank of New York Mellon
Trust Company, N.A.
Institutional Trust Services
P. O. Box 2320
Dallas, Texas 75221 -2320
Express Delivery /Courier
The Bank of New York Mellon
Trust Company, N.A.
Institutional Trust Services
2001 Bryan Street, 9th Floor
Dallas, Texas 75201
By Hand Only
The Bank of New York
Mellon Trust Company, N.A.
Room 234 -North Building
Institutional Trust
Securities Window
55 Water Street
New York, New York 10041
THIS NOTICE is issued and given pursuant to the terms and conditions prescribed for
the redemption of said bonds and pursuant to an ordinance adopted by the City Council of the
City of North Richland Hills, Texas.
THE BANK OF NEW YORK MELLON
TRUST COMPANY, N.A.
2001 Bryan Street, 9th Floor
Dallas, Texas 75201
57354025.5/11310082 C-
EXHIBIT D
NOTICE OF REDEMPTION
CITY OF NORTH RICHLAND HILLS, TEXAS
TAX AND WATERWORKS AND SEWER SYSTEM SURPLUS REVENUE
CERTIFICATES OF OBLIGATION
SERIES 2004
Dated April 15, 2004
NOTICE IS HEREBY GIVEN that the obligations of the above series maturing on and
after February 15, 2015 in the principal amount of $225,000 have been called for redemption on
February 15, 2014 at the redemption price of par and accrued interest to the date of redemption,
such obligations being identified as follows:
Year of
Principal CUSIP
Maturity
Amount Number
2015
$45,000
2016
$45,000
2017
$45,000
2018
$45,000
2019
$45,000
ALL SUCH OBLIGATIONS shall become due and payable on February 15, 2014, and
interest thereon shall cease to accrue from and after said redemption date and payment of the
redemption price of said obligations shall be paid to the registered owners thereof only upon
presentation and surrender of such obligations to The Bank of New York Mellon Trust
Company, N.A. (as successor paying agent/registrar to JPMorgan Chase Bank), at its
designated offices at the following addresses:
First Class/
Registered /Certified
The Bank of New York Mellon
Trust Company, N.A.
Institutional Trust Services
P. O. Box 2320
Dallas, Texas 75221 -2320
Express Delivery /Courier
The Bank of New York Mellon
Trust Company, N.A.
Institutional Trust Services
2001 Bryan Street, 9th Floor
Dallas, Texas 75201
By Hand Only
The Bank of New York
Mellon Trust Company, N.A.
Room 234 -North Building
Institutional Trust
Securities Window
55 Water Street
New York, New York 10041
THIS NOTICE is issued and given pursuant to the terms and conditions prescribed for
the redemption of said obligations and pursuant to an ordinance adopted by the City Council of
the City of North Richland Hills, Texas.
THE BANK OF NEW YORK MELLON
TRUST COMPANY, N.A.
2001 Bryan Street, 9th Floor
Dallas, Texas 75201
57354025.5/11310082 D-1
EXHIBIT E
NOTICE OF REDEMPTION
CITY OF NORTH RICHLAND HILLS, TEXAS
GENERAL OBLIGATION REFUNDING AND IMPROVEMENT BONDS
SERIES 2004
Dated April 15, 2004
NOTICE IS HEREBY GIVEN that the bonds of the above series maturing on and after
February 15, 2015 and aggregating in the principal amount of $3,855,000 have been called for
redemption on February 15, 2014 at the redemption price of par and accrued interest to the date
of redemption, such bonds being identified as follows:
Year of
Principal
CUSIP Year of
Principal CUSIP
Maturity
Amount
Number Maturity
Amount Number
2015
$980,000
2020
$245,000
2016
$625,000
2021
$245,000
2017
$535,000
2022
$245,000
2018
$245,000
2023
$245,000
2019
$245,000
2024
$245,000
ALL SUCH BONDS shall become due and payable on February 15, 2014, and interest
thereon shall cease to accrue from and after said redemption date and payment of the
redemption price of said bonds shall be paid to the registered owners thereof only upon
presentation and surrender of such bonds to The Bank of New York Mellon Trust Company,
N.A. (as successor paying agent /registrar to JPMorgan Chase Bank), at its designated offices at
the following addresses:
First Class/
Reg istered /Certified
The Bank of New York Mellon
Trust Company, N.A.
Institutional Trust Services
P. O. Box 2320
Dallas, Texas 75221 -2320
Express Delivery /Courier
The Bank of New York Mellon
Trust Company, N.A.
Institutional Trust Services
2001 Bryan Street, 9th Floor
Dallas, Texas 75201
By Hand Only
The Bank of New York
Mellon Trust Company, N.A.
Room 234 -North Building
Institutional Trust
Securities Window
55 Water Street
New York, New York 10041
THIS NOTICE is issued and given pursuant to the terms and conditions prescribed for
the redemption of said bonds and pursuant to an ordinance adopted by the City Council of the
City of North Richland Hills, Texas.
THE BANK OF NEW YORK MELLON
TRUST COMPANY, N.A.
2001 Bryan Street, 9th Floor
57354025.5/11310082 E-
EXHIBIT F
DESCRIPTION OF ANNUAL FINANCIAL INFORMATION
The following information is referred to in Section 29 of this Ordinance.
Annual Financial Statements and Operating Data
The financial information and operating data with respect to the City to be provided
annually in accordance with such Section are as specified below:
1. Financial information of the general type included in the Official Statement as
Appendix B for the most recently concluded fiscal year.
2. The information contained in Tables 1 through 5 and 7 through 14 in the Official
Statement.
Accounting Principles
The accounting principles referred to in such Section are generally those described in
Appendix B to the Official Statement, as such principles may be changed from time to time to
comply with state law or regulation.
57354025.5/11310082 F-