COUNCIL COMMUNICATION
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DATE: 10/07/2002 |
SUBJECT: FINAL READING OF ORDINANCE 2002-O-249
Authorizing the issuance of City of Laredo, Texas Subordinate Water System Revenue Bonds, Series 2002, in the amount of $741,000; and awarding the sale of the bonds to the Texas Water Development Board and making provisions for the security thereof; and authorizing the amendment to the City’s budget to appropriate such proceeds for the purpose authorized herein; and ordaining other matters relating to the subject. |
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INITIATED
BY: Larry Dovalina, City Manager Cynthia Collazo, Assistant City Manager |
STAFF
SOURCE: Rosario C. Cabello, Finance Director |
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PREVIOUS
COUNCIL ACTION: Ordinance
93-O-211 Authorizing the City Manager to execute an Interlocal Agreement
between the City of Laredo and the Count of Webb for the purpose of extending
water and wastewater services to unincorporated areas of the County under the
Economically Distressed Areas Program.
Resolution 2000-R-035 Requesting assistance from the Texas Water
Development Board for the Colonias Project under the Economically Distressed
Areas Program. A public hearing and introduction of this ordinance was held
on September 16, 2002. |
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BACKGROUND: As
part of the Colonias project that will provide water and wastewater services
to unincorporated areas of the County, the City of Laredo applied for
financial assistance from the Texas Water Development Board for the Colonias project
under the Economically Distressed Areas Program. Ordinance 93-O-211 was adopted to approve an Interlocal
Agreement between the City of Laredo and the County of Webb. Resolution 2000-R-035 was adopted on
February 28, 2002, requesting assistance from the Texas Water Development
Board for the Colonias project Under the Economically Distressed Area
Program. |
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FINANCIAL: The bond will have a final maturity of
April 1, 2024 with interest rates that range from 3.32% to 5.92%. The average
coupon rate is 5.478%, Average annual debt service of $60,227.44, Maximum
annual debt service of $62,301.10 at a total cost of interest of $551,380.48
over the life of the bonds. |
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COMMITTEE
RECOMMENDATION: |
RECOMMENDATION:
Approval of final reading of this ordinance. |
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ORDINANCE NO. 2002-O-249
AUTHORIZING THE ISSUANCE OF CITY OF LAREDO, TEXAS
SUBORDINATE
WATERWORKS SYSTEM REVENUE BONDS, SERIES 2002, IN THE AMOUNT
OF
$741,000; AND AWARDING THE SALE OF THE BONDS TO THE TEXAS
WATER
DEVELOPMENT BOARD AND MAKING PROVISIONS FOR THE SECURITY
THEREOF;
AND AUTHORIZING THE AMENDMENT TO THE CITY'S BUDGET TO
APPROPRIATE
SUCH PROCEEDS FOR THE PURPOSE AUTHORIZED HEREIN; AND
ORDAINING
OTHER MATTERS RELATING TO THE SUBJECT
THE STATE OF TEXAS §
COUNTY OF WEBB §
WHEREAS, the following
Waterworks System Revenue Bonds of the Issuer are presently
outstanding:
Waterworks System Revenue Bonds, New Series 1990, dated
February 1, 1990,
maturing April 1, 2003, now outstanding in the principal
amount of $300,000 (the "New
Series 1990 Bonds" or "New Series Bonds");
and
Waterworks System Revenue Refunding Bonds, New Series 1992,
dated May 15, 1992,
maturing April 1, 2003 through April 1, 2006, now
outstanding in the principal amount of
$635,000 (the "New Series 1992 Bonds" or "New
Series Bonds"); and
Waterworks System Revenue Refunding Bonds, New Series 1996,
dated September 1,
1996, maturing April 1, 2003 through April 1, 2010, now
outstanding in the principal
amount of $6,435,000 (the "New Series 1996 Bonds"
or "New Series Bonds"); and
WHEREAS, the bonds
hereinafter authorized are to be issued and delivered pursuant to Chapter
1502, Government Code; and
WHEREAS, the meeting
was open to the public and public notice of the time, place and purpose
of said meeting was given pursuant to Chapter 551, Texas
Government Code.
NOW, THEREFORE,
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
LAREDO, TEXAS:
Section 1.
AMOUNT AND PURPOSE OF THE BONDS. The bond or bonds of the City
of Laredo (the
"Issuer") are hereby authorized to be issued and delivered in the
aggregate principal amount
of $741,000,
for the purpose of improvements and extensions to the Issuer's Waterworks
System.
2
Section 2.
DESIGNATION OF THE BONDS. Each bond issued pursuant to this Ordinance
shall be
designated: "CITY OF LAREDO, TEXAS SUBORDINATE WATERWORKS SYSTEM
REVENUE BOND,
SERIES 2002", and initially there shall be issued, sold, and delivered
hereunder a
single fully
registered bond, without interest coupons, payable in annual installments of
principal (the "Initial
Bond"),
but the Initial Bond may be assigned and transferred and/or converted into and
exchanged for a
like aggregate
principal amount of fully registered bonds, without interest coupons, having
serial and annual
maturities, and
in the denomination or denominations of $1,000 or any integral multiple of
$1,000, all in the
manner
hereinafter provided. The term "Bonds" as used in this Ordinance
shall mean and include
collectively
the Initial Bond and all substitute bonds exchanged therefor, as well as all
other substitute bonds
and replacement
bonds issued pursuant hereto, and the term "Bond" shall mean any of
the Bonds.
Section 3.
INITIAL DATE, DENOMINATION, NUMBER, MATURITIES, INITIAL
REGISTERED
OWNER, AND CHARACTERISTICS OF THE INITIAL BOND. (a) The Initial Bond
is hereby
authorized to be issued, sold, and delivered hereunder as a single fully
registered Bond, without
interest
coupons, dated April 1, 2002, in the denomination and aggregate principal
amount of $741,000,
numbered R-1,
payable in annual installments of principal to the initial registered owner
thereof, to-wit:
TEXAS WATER
DEVELOPMENT BOARD, or to the registered assignee or assignees of
said Bond
or any portion
or portions thereof (in each case, the "registered owner"), with the
annual installments of
principal of
the Initial Bond to be payable on the dates, respectively, and in the principal
amounts,
respectively,
stated in the FORM OF INITIAL BOND set forth in this Ordinance.
(b) The Initial
Bond (i) may be prepaid or redeemed prior to the respective scheduled due dates
of installments
of principal thereof, (ii) may be assigned and transferred, (iii) may be converted
and
exchanged for
other Bonds, (iv) shall have the characteristics, and (v) shall be signed and
sealed, and the
principal of
and interest on the Initial Bond shall be payable, all as provided, and in the
manner required
or indicated,
in the FORM OF INITIAL BOND set forth in this Ordinance.
Section 4.
INTEREST. The unpaid principal balance of the Initial Bond shall bear interest
from the date
of delivery of the Initial Bond, and will be calculated on the basis of a
360-day year of twelve
30-day months
to the respective scheduled due dates, or to the respective dates of prepayment
or
redemption, of
the installments of principal of the Initial Bond, and said interest shall be
payable, all in the
manner provided
and at the rates and on the dates stated in the FORM OF INITIAL BOND set forth
in
this Ordinance.
Section 5. FORM
OF INITIAL BOND. The form of the Initial Bond, including the form of
Registration
Certificate of the Comptroller of Public Accounts of the State of Texas to be
endorsed on the
Initial Bond,
shall be substantially as follows:
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FORM OF INITIAL
BOND
NO. R-1
$741,000
UNITED STATES
OF AMERICA
STATE OF TEXAS
COUNTY OF WEBB
CITY OF LAREDO,
TEXAS
SUBORDINATE
WATERWORKS SYSTEM REVENUE BOND
SERIES 2002
CITY OF LAREDO,
in WEBB COUNTY (the "Issuer"), being a political subdivision of the
State
of Texas,
hereby promises to pay to
TEXAS WATER
DEVELOPMENT BOARD
or to the
registered assignee or assignees of this Bond or any portion or portions hereof
(in each case, the
"registered
owner") the aggregate principal amount of
SEVEN HUNDRED
FORTY ONE THOUSAND DOLLARS
in annual
installments of principal due and payable on April 1 in each of the years, and
in the respective
principal
amounts, as set forth in the following schedule:
YEAR AMOUNT
YEAR AMOUNT
2005 23,000 2015 36,000
2006 24,000 2016 38,000
2007 25,000 2017 40,000
2008 26,000 2018 42,000
2009 27,000 2019 44,000
2010 28,000 2020 47,000
2011 30,000 2021 49,000
2012 31,000 2022 52,000
2013 32,000 2023 55,000
2014 34,000 2024 58,000
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and to pay
interest, from the date of delivery of this Bond, on the balance of each such
installment of
principal,
respectively, from time to time remaining unpaid, at the rates as follows:
maturity 2005,
3.320 % maturity 2015, 5.170 %
maturity 2006,
3.620 % maturity 2016, 5.320 %
maturity 2007,
3.920 % maturity 2017, 5.420 %
maturity 2008,
4.220 % maturity 2018, 5.520 %
maturity 2009,
4.420 % maturity 2019, 5.620 %
maturity 2010,
4.620 % maturity 2020, 5.720 %
maturity 2011,
4.770 % maturity 2021, 5.770 %
maturity 2012,
4.870 % maturity 2022, 5.820 %
maturity 2013,
4.970 % maturity 2023, 5.870 %
maturity 2014,
5.070 % maturity 2024, 5.920 %
with said
interest being payable on April 1, 2003 and semiannually on each October 1 and
April 1
thereafter
while this Bond or any portion hereof is outstanding and unpaid.
THE
INSTALLMENTS OF PRINCIPAL OF AND THE INTEREST ON this bond are payable
in lawful money
of the United States of America, without exchange or collection charges. The
installments
of principal
and the interest on this Bond are payable to the registered owner hereof
through the services
of JPMORGAN
CHASE BANK, DALLAS, TEXAS, which is the "Paying
Agent/Registrar" for this
Bond. Payment
of all principal of and interest on this Bond shall be made by the Paying
Agent/Registrar
to the
registered owner hereof on each principal and/or interest payment date by check
or draft, dated as
of such date,
drawn by the Paying Agent/Registrar on, and payable solely from, funds of the
Issuer required
by the
ordinance authorizing the issuance of this Bond (the "Bond
Ordinance") to be on deposit with the
Paying
Agent/Registrar for such purpose as hereinafter provided; and such check or
draft shall be sent by
the Paying
Agent/Registrar by United States mail, first class postage prepaid, on each
such principal and/or
interest
payment date, to the registered owner hereof, at the address of the registered
owner, as it appeared
on the 15th day
of the month next preceding each such date (the "Record Date") on the
Registration Books
kept by the
Paying Agent/Registrar, as hereinafter described, or by such other method
acceptable to the
Paying
Agent/Registrar requested by, and at the risk and expense of, the registered
owner; however, if the
Bond is owned
by the Texas Water Development Board, there will be no charge to the Texas
Water
Development
Board. The Issuer covenants with the registered owner of this Bond that on or
before each
principal
and/or interest payment date for this Bond it will make available to the Paying
Agent/Registrar,
from the
"Bond Fund" created by the Bond Ordinance, the amounts required to
provide for the payment,
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in immediately
available funds, of all principal of and interest on this Bond, when due.
IF THE DATE for
the payment of the principal of or interest on this Bond shall be a Saturday,
Sunday, a legal
holiday, or a day on which banking institutions in the city where the 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 on which
banking
institutions
are authorized to close; and payment on such date shall have the same force and
effect as if
made on the
original date payment was due.
THIS BOND has
been authorized in accordance with the Constitution and laws of the State of
Texas, in the
principal amount of $741,000, for the purpose of improvements and extensions to
the Issuer's
Waterworks System.
ON APRIL 1,
2012, or any date thereafter, the unpaid installments of principal of this Bond
may
be prepaid or
redeemed prior to their scheduled due dates, at the option of the Issuer, with
funds derived
from any
available source, as a whole, or in part, and, if in part, the Issuer shall, in
inverse order of annual
maturity,
select and designate the maturity, or maturities, and the amount that is to be
redeemed, and if less
than a whole
maturity is to be redeemed, the Issuer shall direct the Paying Agent/Registrar
to call by lot
(provided that
a portion of this Bond may be redeemed only in an integral multiple of $1,000),
at a price
equal to the
principal amount to be so prepaid or redeemed, plus accrued interest to the
date fixed for
prepayment or
redemption.
AT LEAST 30
days prior to the date fixed for any such prepayment or redemption a written
notice
of such
prepayment or redemption shall be mailed by the Paying Agent/Registrar to the
registered owner
hereof. By the
date fixed for any such prepayment or redemption due provision shall be made by
the Issuer
with the Paying
Agent/Registrar for the payment of the required prepayment or redemption price
for this
Bond or the
portion hereof which is to be so prepaid or redeemed, plus accrued interest
thereon to the date
fixed for
prepayment or redemption. If such written notice of prepayment or redemption is
given, and if
due provision
for such payment is made, all as provided above, this Bond, or the portion
thereof which is
to be so
prepaid or redeemed, thereby automatically shall be treated as prepaid or
redeemed prior to its
scheduled due
date, and shall not bear interest after the date fixed for its prepayment or
redemption, and
shall not be
regarded as being outstanding except for the right of the registered owner to
receive the
prepayment or
redemption price plus accrued interest to the date fixed for prepayment or
redemption from
the Paying
Agent/Registrar out of the funds provided for such payment. The Paying
Agent/Registrar shall
record in the
Registration Books all such prepayments or redemptions of principal of this
Bond or any
portion hereof.
THIS BOND, to
the extent of the unpaid or unredeemed principal balance hereof, or any unpaid
and unredeemed
portion hereof in any integral multiple of $1,000, may be assigned by the
initial registered
owner hereof
and shall be transferred only in the Registration Books of the Issuer kept by
the Paying
Agent/Registrar
acting in the capacity of registrar for the Bonds, upon the terms and conditions
set forth
6
in the Bond
Ordinance. Among other requirements for such transfer, this Bond must be
presented and
surrendered to
the Paying Agent/Registrar for cancellation, together with proper instruments
of assignment,
in form and
with guarantee of signatures satisfactory to the Paying Agent/Registrar,
evidencing assignment
by the initial
registered owner of this Bond, or any portion or portions hereof in any
integral multiple of
$1,000, to the
assignee or assignees in whose name or names this Bond or any such portion or
portions
hereof is or
are to be transferred and registered. Any instrument or instruments of
assignment satisfactory
to the Paying
Agent/Registrar may be used to evidence the assignment of this Bond or any such
portion or
portions hereof
by the initial registered owner hereof. A new bond or bonds payable to such
assignee or
assignees
(which then will be the new registered owner or owners of such new Bond or
Bonds) or to the
initial
registered owner as to any portion of this Bond which is not being assigned and
transferred by the
initial
registered owner, shall be delivered by the Paying Agent/Registrar in
conversion of and exchange for
this Bond or
any portion or portions hereof, but solely in the form and manner as provided
in the next
paragraph
hereof for the conversion and exchange of this Bond or any portion hereof. The
registered
owner of this
Bond shall be deemed and treated by the Issuer and the Paying Agent/Registrar
as the
absolute owner
hereof for all purposes, including payment and discharge of liability upon this
Bond to the
extent of such
payment, and the Issuer and the Paying Agent/Registrar shall not be affected by
any notice
to the
contrary.
AS PROVIDED
above and in the Bond Ordinance, this Bond, to the extent of the unpaid or
unredeemed
principal balance hereof, may be converted into and exchanged for a like
aggregate principal
amount of fully
registered bonds, without interest coupons, payable to the assignee or
assignees duly
designated in
writing by the initial registered owner hereof, or to the initial registered
owner as to any
portion of this
Bond which is not being assigned and transferred by the initial registered
owner, in any
denomination or
denominations in any integral multiple of $1,000 (subject to the requirement
hereinafter
stated that
each substitute bond issued in exchange for any portion of this Bond shall have
a single stated
principal
maturity date), upon surrender of this Bond to the Paying Agent/Registrar for
cancellation, all in
accordance with
the form and procedures set forth in the Bond Ordinance. If this Bond or any
portion
hereof is
assigned and transferred or converted each bond issued in exchange for any
portion hereof shall
have a single
stated principal maturity date corresponding to the due date of the installment
of principal of
this Bond or
portion hereof for which the substitute bond is being exchanged, and shall bear
interest at the
rate applicable
to and borne by such installment of principal or portion thereof. Such bonds,
respectively,
shall be
subject to redemption prior to maturity on the same dates and for the same
prices as the
corresponding
installment of principal of this Bond or portion hereof for which they are
being exchanged.
No such bond
shall be payable in installments, but shall have only one stated principal
maturity date. AS
PROVIDED IN THE
BOND ORDINANCE, THIS BOND IN ITS PRESENT FORM MAY BE
ASSIGNED AND
TRANSFERRED OR CONVERTED ONCE ONLY, and to one or more assignees,
but the bonds
issued and delivered in exchange for this Bond or any portion hereof may be
assigned and
transferred,
and converted, subsequently, as provided in the Bond Ordinance. The Issuer
shall pay the
Paying Agent/
Registrar's standard or customary fees and charges for transferring,
converting, and
exchanging this
Bond or any portion thereof, but the one requesting such transfer, conversion,
and exchange
shall pay any
taxes or governmental charges required to be paid with respect thereto. The
Paying
7
Agent/Registrar
shall not be required to make any such assignment, conversion, or exchange (i)
during the
period
commencing with the close of business on any Record Date and ending with the
opening of business
on the next
following principal or interest payment date, or, (ii) with respect to any Bond
or portion thereof
called for
prepayment or redemption prior to maturity, within 30 days prior to its
prepayment or redemption
date.
IN THE EVENT
any Paying Agent/Registrar for this Bond is changed by the Issuer, resigns, or
otherwise ceases
to act as such, the Issuer has covenanted in the Bond Ordinance that it
promptly will
appoint a
competent and legally qualified substitute therefor, and promptly will cause
written notice thereof
to be mailed to
the registered owner of this Bond.
IT IS HEREBY
certified, recited, and covenanted that this Bond has been duly and validly
authorized,
issued, and delivered pursuant to the applicable laws of the State of Texas,
including particularly
Chapter 1502,
Texas Government Code; that all acts, conditions, and things required or proper
to be
performed,
exist, and be done precedent to or in the authorization, issuance, and delivery
of this Bond have
been performed,
existed, and been done in accordance with law, and that the principal of and
interest on
this Bond, are
payable from, and secured by a lien on and pledge of, the net revenues of the
Issuer's
Waterworks
System, all as defined in the Bond Ordinance, which includes initially the net
revenues of the
Issuer's
Waterworks System, junior and subordinate to the first lien on and pledge of
the net revenues of
the Waterworks
System heretofore created to secure and pay the New Series Bonds, all as such
terms
are defined in
the Ordinance, and which net revenues of the Waterworks System constitutes a part
of the
Pledged
Revenues for the New Series Bonds may, in the future, at the option of the
Issuer, include other
resources.
THE ISSUER has
reserved the right, subject to the restrictions stated in the Ordinance
authorizing
this Series of
Bonds, to issue additional revenue bonds which also may be made payable from,
and secured
by a lien on
and pledge of, the net revenues of the Waterworks System.
THE OWNER
HEREOF shall never have the right to demand payment of this obligation out of
any
funds raised or
to be raised by taxation.
BY BECOMING the
registered owner of this Bond, the registered owner thereby acknowledges
all of the
terms and provisions of the Bond Ordinance, agrees to be bound by such terms
and provisions,
acknowledges
that the Bond Ordinance is duly recorded and available for inspection in the
official minutes
and records of
the governing body of the Issuer, and agrees that the terms and provisions of
this Bond and
the Bond
Ordinance constitute a contract between the registered owner hereof and the
Issuer.
8
IN WITNESS
WHEREOF, the Issuer has caused this Bond to be signed with the manual signature
of the Mayor of
the Issuer and countersigned with the manual signature of the City Secretary of
the Issuer,
has caused the
official seal of the Issuer to be duly impressed on this Bond, and has caused
this Bond to
be dated April
1, 2002.
City Secretary
Mayor
(CITY SEAL)
The following
shall be printed on said Initial Bond:
"This
Initial Bond was delivered to and paid for by the Purchaser thereof on
_____________."
FORM OF
REGISTRATION CERTIFICATE OF THE
COMPTROLLER OF
PUBLIC ACCOUNTS:
COMPTROLLER'S
REGISTRATION CERTIFICATE: REGISTER NO.
I hereby
certify that this Bond has been examined, certified as to validity, and
approved by the
Attorney
General of the State of Texas, and that this Bond has been registered by the
Comptroller of Public
Accounts of the
State of Texas.
Witness my
signature and seal this
Comptroller of
Public Accounts of the State of Texas
(COMPTROLLER'S
SEAL)
Section 6.
ADDITIONAL CHARACTERISTICS OF THE BONDS. (a) Registration and
Transfer. The
Issuer shall keep or cause to be kept at the principal corporate trust office
of JPMORGAN
CHASE BANK,
DALLAS, TEXAS, (the "Paying Agent/Registrar") books
or records of the registration
and transfer of
the Bonds (the "Registration Books"), and the Issuer hereby appoints
the Paying
Agent/Registrar
as its registrar and transfer agent to keep such books or records and make such
transfers
and
registrations under such reasonable regulations as the Issuer and Paying
Agent/Registrar may prescribe;
and the Paying
Agent/Registrar shall make such transfers and registrations as herein provided.
The Paying
Agent/Registrar
shall obtain and record in the Registration Books the address of the registered
owner of
each Bond to
which payments with respect to the Bonds shall be mailed, as herein provided;
but it shall
be the duty of
each registered owner to notify the Paying Agent/Registrar in writing of the
address to which
payments shall
be mailed, and such interest payments shall not be mailed unless such notice
has been given.
The Issuer
shall have the right to inspect the Registration Books during regular business
hours of the Paying
Agent/Registrar,
but otherwise the Paying Agent/Registrar shall keep the Registration Books
confidential
9
and, unless
otherwise required by law, shall not permit their inspection by any other
entity. Registration of
each Bond may
be transferred in the Registration Books only upon presentation and surrender
of such
Bond to the
Paying Agent/Registrar for transfer of registration and cancellation, together
with proper written
instruments of
assignment, in form and with guarantee of signatures satisfactory to the Paying
Agent/Registrar,
(i) evidencing the assignment of the Bond, or any portion thereof in any
integral multiple
of $1,000, to
the assignee or assignees thereof, and (ii) the right of such assignee or
assignees to have the
Bond or any
such portion thereof registered in the name of such assignee or assignees. Upon
the
assignment and
transfer of any Bond or any portion thereof, a new substitute Bond or Bonds
shall be issued
in conversion
and exchange therefor in the manner herein provided. The Initial Bond, to the
extent of the
unpaid or
unredeemed principal balance thereof, may be assigned and transferred by the
initial registered
owner thereof
once only, and to one or more assignees designated in writing by the initial
registered owner
thereof. All
Bonds issued and delivered in conversion of and exchange for the Initial Bond
shall be in any
denomination or
denominations of any integral multiple of $1,000 (subject to the requirement
hereinafter
stated that
each substitute Bond shall have a single stated principal maturity date), shall
be in the form
prescribed in
the FORM OF SUBSTITUTE BOND set forth in this Ordinance, and shall have the
characteristics,
and may be assigned, transferred, and converted as hereinafter provided. If the
Initial Bond
or any portion
thereof is assigned and transferred or converted the Initial Bond must be
surrendered to the
Paying
Agent/Registrar for cancellation, and each Bond issued in exchange for any
portion of the Initial
Bond shall have
a single stated principal maturity date, and shall not be payable in
installments; and each
such Bond shall
have a principal maturity date corresponding to the due date of the installment
of principal
or portion
thereof for which the substitute Bond is being exchanged; and each such Bond
shall bear interest
at the single rate
applicable to and borne by such installment of principal or portion thereof for
which it is
being
exchanged. If only a portion of the Initial Bond is assigned and transferred,
there shall be delivered
to and
registered in the name of the initial registered owner substitute Bonds in
exchange for the unassigned
balance of the
Initial Bond in the same manner as if the initial registered owner were the
assignee thereof.
If any Bond or
portion thereof other than the Initial Bond is assigned and transferred or
converted each
Bond issued in
exchange shall have the same principal maturity date and bear interest at the
same rate as
the Bond for
which it is exchanged. A form of assignment shall be printed or endorsed on
each Bond,
excepting the
Initial Bond, which shall be executed by the registered owner or its duly
authorized attorney
or
representative to evidence an assignment thereof. Upon surrender of any Bonds
or any portion or
portions
thereof for transfer of registration, an authorized representative of the
Paying Agent/Registrar shall
make such
transfer in the Registration Books, and shall deliver a new fully registered
substitute Bond or
Bonds, having
the characteristics herein described, payable to such assignee or assignees
(which then will
be the registered
owner or owners of such new Bond or Bonds), or to the previous registered owner
in
case only a
portion of a Bond is being assigned and transferred, all in conversion of and
exchange for said
assigned Bond
or Bonds or any portion or portions thereof, in the same form and manner, and
with the
same effect, as
provided in Section 6(d), below, for the conversion and exchange of Bonds by
any
registered
owner of a Bond. The Issuer shall pay the Paying Agent/Registrar's standard or
customary fees
and charges for
making such transfer and delivery of a substitute Bond or Bonds, but the one
requesting
such transfer
shall pay any taxes or other governmental charges required to be paid with
respect thereto.
The Paying
Agent/Registrar shall not be required to make transfers of registration of any
Bond or any
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portion thereof
(i) during the period commencing with the close of business on any Record Date
and ending
with the
opening of business on the next following principal or interest payment date,
or, (ii) with respect
to any Bond or
any portion thereof called for redemption prior to maturity, within 45 days
prior to its
redemption
date.
(b) Ownership
of Bonds. The entity in whose name any Bond shall be registered in the
Registration
Books at any time shall be deemed and treated as the absolute owner thereof for
all purposes
of this
Ordinance, whether or not such Bond shall be overdue, and the Issuer and the
Paying
Agent/Registrar
shall not be affected by any notice to the contrary; and payment of, or on
account of, the
principal of,
premium, if any, and interest on any such Bond shall be made only to such
registered owner.
All such
payments shall be valid and effectual to satisfy and discharge the liability
upon such Bond to the
extent of the
sum or sums so paid.
(c) Payment of
Bonds and Interest. The Issuer hereby further appoints the Paying
Agent/Registrar
to act as the
paying agent for paying the principal of and interest on the Bonds, and to act
as its agent to
convert and
exchange or replace Bonds, all as provided in this Ordinance. The Paying
Agent/Registrar
shall keep
proper records of all payments made by the Issuer and the Paying
Agent/Registrar with respect
to the Bonds,
and of all conversions and exchanges of Bonds, and all replacements of Bonds,
as provided
in this
Ordinance. However, in the event of a nonpayment of interest on a scheduled
payment date, and
for thirty (30)
days thereafter, a new record date for such interest payment (a "Special
Record Date") will
be established
by the Paying Agent/Registrar, if and when funds for the payment of such
interest have been
received from
the Issuer. Notice of the Special Record Date and of the scheduled payment date
of the past
due interest
(which shall be two 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 Bondholder
appearing on the Security Register at the close of business on the last
business day next
preceding the
date of mailing of such notice.
(d) Conversion
and Exchange or Replacement; Authentication. Each Bond issued and delivered
pursuant to
this Ordinance, to the extent of the unpaid or unredeemed principal balance or
principal
amount thereof,
may, upon surrender of such Bond at the principal corporate trust office of the
Paying
Agent/Registrar,
together with a written request therefor duly executed by the registered owner
or the
assignee or
assignees thereof, or its or their duly authorized attorneys or
representatives, with guarantee
of signatures
satisfactory to the Paying Agent/Registrar, may, at the option of the
registered owner or such
assignee or
assignees, as appropriate, be converted into and exchanged for fully registered
bonds, without
interest
coupons, in the form prescribed in the FORM OF SUBSTITUTE BOND set forth in
this
Ordinance, in
the denomination of $1,000, or any integral multiple of $1,000 (subject to the
requirement
hereinafter
stated that each substitute Bond shall have a single stated maturity date), as
requested in writing
by such
registered owner or such assignee or assignees, in an aggregate principal
amount equal to the
unpaid or
unredeemed principal balance or principal amount of any Bond or Bonds so
surrendered, and
payable to the
appropriate registered owner, assignee, or assignees, as the case may be. If
the Initial Bond
is assigned and
transferred or converted each substitute Bond issued in exchange for any
portion of the
11
Initial Bond
shall have a single stated principal maturity date, and shall not be payable in
installments; and
each such Bond
shall have a principal maturity date corresponding to the due date of the
installment of
principal or
portion thereof for which the substitute Bond is being exchanged; and each such
Bond shall
bear interest
at the single rate applicable to and borne by such installment of principal or
portion thereof
for which it is
being exchanged. If a portion of any Bond (other than the Initial Bond) shall
be redeemed
prior to its
scheduled maturity as provided herein, a substitute Bond or Bonds having the
same maturity
date, bearing
interest at the same rate, in the denomination or denominations of any integral
multiple of
$1,000 at the
request of the registered owner, and in aggregate principal amount equal to the
unredeemed
portion
thereof, will be issued to the registered owner upon surrender thereof for
cancellation. If any Bond
or portion
thereof (other than the Initial Bond) is assigned and transferred or converted,
each Bond issued
in exchange
therefor shall have the same principal maturity date and bear interest at the
same rate as the
Bond for which
it is being exchanged. Each substitute Bond shall bear a letter and/or number
to distinguish
it from each
other Bond. The Paying Agent/Registrar shall convert and exchange or replace
Bonds as
provided
herein, and each fully registered bond delivered in conversion of and exchange
for or replacement
of any Bond or
portion thereof as permitted or required by any provision of this Ordinance
shall constitute
one of the
Bonds for all purposes of this Ordinance, and may again be converted and
exchanged or
replaced. It is
specifically provided that any Bond authenticated in conversion of and exchange
for or
replacement of
another Bond on or prior to the first scheduled Record Date for the Initial
Bond shall bear
interest from
the date of the Initial Bond, but each substitute Bond so authenticated after
such first
scheduled
Record Date shall bear interest from the interest payment date next preceding
the date on which
such substitute
Bond was so authenticated, unless such Bond is authenticated after any Record
Date but
on or before
the next following interest payment date, in which case it shall bear interest
from such next
following
interest payment date; provided, however, that if at the time of delivery of
any substitute Bond
the interest on
the Bond for which it is being exchanged is due but has not been paid, then
such Bond shall
bear interest
from the date to which such interest has been paid in full. THE INITIAL BOND
issued and
delivered
pursuant to this Ordinance is not required to be, and shall not be,
authenticated by the Paying
Agent/
Registrar, but on each substitute Bond issued in conversion of and exchange for
or replacement of
any Bond or
Bonds issued under this Ordinance there shall be printed a certificate, in the
form substantially
as follows:
"PAYING
AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
It is hereby
certified that this Bond has been issued under the provisions of the Bond
Ordinance
described on
the face of this Bond; and that this Bond has been issued in conversion of and
exchange for
or replacement
of a bond, bonds, or a portion of a bond or bonds of an issue which originally
was
approved by the
Attorney General of the State of Texas and registered by the Comptroller of
Public
Accounts of the
State of Texas.
Paying
Agent/Registrar
Dated
__________ By_________________________
Authorized
Representative"
12
An authorized
representative of the Paying Agent/Registrar shall, before the delivery of any
such Bond, date
and manually
sign the above Certificate, and no such Bond shall be deemed to be issued or
outstanding
unless such
Certificate is so executed. The Paying Agent/Registrar promptly shall cancel
all Bonds
surrendered for
conversion and exchange or replacement. No additional ordinances, orders, or
resolutions
need be passed
or adopted by the governing body of the Issuer or any other body or person so
as to
accomplish the
foregoing conversion and exchange or replacement of any Bond or portion
thereof, and the
Paying
Agent/Registrar shall provide for the printing, execution, and delivery of the
substitute Bonds in the
manner
prescribed herein, and said Bonds shall be of type composition printed on paper
with lithographed
or steel
engraved borders of customary weight and strength. Pursuant to Chapter 1201,
Texas
Government
Code, the duty of conversion and exchange or replacement of Bonds as aforesaid
is hereby
imposed upon
the Paying Agent/Registrar, and, upon the execution of the above Paying
Agent/Registrar's
Authentication
Certificate, the converted and exchanged or replaced Bond shall be valid,
incontestable, and
enforceable in
the same manner and with the same effect as the Initial Bond which originally
was issued
pursuant to
this Ordinance, approved by the Attorney General, and registered by the
Comptroller of Public
Accounts. The
Issuer shall pay the Paying Agent/Registrar's standard or customary fees and
charges for
transferring,
converting, and exchanging any Bond or any portion thereof, but the one
requesting any such
transfer,
conversion, and exchange shall pay any taxes or governmental charges required
to be paid with
respect thereto
as a condition precedent to the exercise of such privilege of conversion and
exchange. The
Paying
Agent/Registrar shall not be required to make any such conversion and exchange
or replacement
of Bonds or any
portion thereof (i) during the period commencing with the close of business on
any Record
Date and ending
with the opening of business on the next following principal or interest
payment date, or,
(ii) with
respect to any Bond or portion thereof called for redemption prior to maturity,
within 45 days prior
to its
redemption date.
(e) In General.
All Bonds issued in conversion and exchange or replacement of any other Bond
or portion
thereof, (i) shall be issued in fully registered form, without interest
coupons, with the principal
of and interest
on such Bonds to be payable only to the registered owners thereof, (ii) may be
redeemed