Loading...
Ordinance No. 12,486ORDINANCE NO.12,486 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS,AUTHORIZING THE ISSUANCE OF CITY OF BAYTOWN,TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 2014;LEVYING A TAX IN PAYMENT THEREOF;SETTING CERTAIN PARAMETERS FOR THE SALE OF THE CERTIFICATES; APPROVING THE PREPARATION AND DISTRIBUTION OF AN OFFICIAL STATEMENT;ENACTING OTHER PROVISIONS RELATING THERETO; AND PROVIDING FOR THE EFFECTIVE DATE THEREOF WHEREAS,undertheprovisions of SubchapterC,Chapter271,Texas Local GovernmentCode,asamended(the "Act"),theCity of Baytown,Texas (the "City"),is authorizedtoissuecertificates of obligationforthepurposes specified inthisOrdinanceandfor the payment of alloraportion of thecontractualobligationsfor professional services,including that of engineers,attorneys,andfinancialadvisorsin connection therewith,andtosellthesame forcashas herein provided;and WHEREAS,the City is authorized toprovidethatsuch obligations will bepayablefrom andsecured by the levy of adirectandcontinuingannualad valorem tax,within thelimits prescribed bylaw,againstalltaxablepropertywithintheCity,incombinationwithalimited pledge of asubordinatelienonthenetrevenues of the City's waterworksandsanitarysewer system(the "System")inanamountnottoexceed$1,000asauthorizedbythe Act and Chapter 1502,Texas Government Code;and WHEREAS,theCityCouncilhasfoundanddeterminedthatitisnecessaryandinthe bestinterests of theCityanditscitizensthatitissuesuchcertificates of obligationauthorizedby this Ordinance;and WHEREAS,pursuant toa resolution heretofore passedbythisgoverningbody,notice of intentiontoissuecertificates of obligation of theCitypayableasprovidedinthis Ordinance was published ina newspaper of general circulation intheCityin accordance withthelaws of the State of Texas,whichnoticeprovidedthatthe principal amount of such certificates of obligation wouldnotexceed$12,500,000andthe proceeds wouldbeusedforthepurpose of paying contractual obligations tobe incurred for the purposes set forth inSection3.1hereof;and WHEREAS,suchnoticeprovidedthattheCitytentativelyplannedtoconsiderthe passage of an ordinance authorizing the issuance ofthe Certificates on February 27,2014;and WHEREAS,nopetition of anykindhasbeenfiledwiththeCityClerk,anymember of theCity Council orany other official of theCity,protesting the issuance of such certificates of obligation;and WHEREAS,thisCity Council isnow authorized and empowered to proceed withthe issuance of saidcertificates of obligationandtosellthesamefor cash;and WHEREAS,theCityisa home-rule municipality thathas adopted a charter under Article XI,Section 5 of theTexas Constitution,has a population inexcess of 50,000 and has 4465101.6 outstandingindebtednessthatisratedbyanationallyrecognizedratingagencyformunicipal securitiesinone of thefourhighestratingcategoriesforalong-termobligation;and WHEREAS,theCityhasaprincipalamount of atleast $100,000,000 ina combination of outstandinglong-termindebtednessandlong-termindebtednessproposedtobeissued,andsome amount of suchlong-termindebtednessisratedinone of thefourhighestratingcategoriesfor long-termdebtinstrumentsbyanationallyrecognizedratingagencyformunicipalsecurities without regardtothe effect of anycreditagreementor other form of credit enhancement entered intoin connection withtheobligation,andthereforequalifiesasan "Issuer"under Chapter 1371 of theTexas Government Code,asamended ("Chapter 1371");and WHEREAS,pursuant to Section 1371,theCity desires to delegate the authority to effect thesale ofthe certificates of obligation totheAuthorized Officer (hereinafter defined);and WHEREAS,themeetingatwhichthisOrdinanceisconsideredisopentothepublicas requiredbylaw,andpublicnotice of thetime,place,andpurpose of saidmeetingwasgivenas requiredbyChapter 551,TexasGovernmentCode,asamended;therefore, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS: ARTICLE I DEFINITIONS AND OTHER PRELIMINARY MATTERS Section 1.1.Definitions. Unlessotherwiseexpresslyprovidedorunlessthecontextclearlyrequiresotherwisein thisOrdinance,thefollowingtermsshallhavethemeaningsspecifiedbelow: Act"hasthe meaning assigned tosuchtermintherecitals of this Ordinance. AuthorizedOfficer"meanstheMayororCityManager of theCity,whoareauthorized toactonbehalfoftheCityinsellingand delivering the Certificates,orsuchotherofficers of the Cityasdesignatedinwriting. Bond Counsel"means Bracewell &Giuliani LLP. BusinessDay"meansadaythatisnota Saturday,Sunday,legalholidayorotherdayon which banking institutions inthecity where the Designated Payment/Transfer Office is located arerequiredorauthorizedbylaworexecutiveordertoclose. Certificate"means any of the Certificates. Certificates"meanstheCity's certificates of obligation authorized tobeissuedby Section 3.1 ofthis Ordinance and designated as"Cityof Baytown,Texas Combination Taxand Revenue Certificates of Obligation,Series 2014"andsuchotherseriesor subseries asmaybe designatedinthePricingCertificate. 4465101.6 Chapter 1371"hasthe meaning assigned to such term inthe recitals of this Ordinance. City"means theCity of Baytown,Texas. Closing Date"means thedate of theinitial delivery of and payment forthe Certificates as designated inthe Pricing Certificate. Code"means the Internal Revenue Code of 1986,as amended. DatedDate"meanstheApril1,2014,unlessotherwise designated inthePricing Certificate. DebtService"meansthecollectively,allamountsdueandpayablewithrespecttothe Certificatesrepresentingtheprincipal of theCertificatesandtheinterest,payableatthetimes andinthemannerprovidedhereinandinthePricingCertificate. Designated Payment/Transfer Office"means (i)with respecttotheinitialPaying Agent/Registrar,Dallas,TexasorsuchotherlocationdesignatedbythePaying Agent/Registrar, and(ii)withrespecttoanysuccessorPaying Agent/Registrar,theoffice of suchsuccessor designated andlocatedasmaybeagreeduponbytheCityandsuch successor. DTC"meansTheDepositoryTrust Company of NewYork,NewYork,orany successor securities depository. DTC Participant"means brokers and dealers,banks,trust companies,clearing corporations and certain other organizations on whose behalf DTC was created to hold securities tofacilitatetheclearanceandsettlement of securitiestransactionsamongDTCParticipants. FiscalYear"meanssuch fiscal yearasshallfromtimetotimebesetbytheCity Council. Interest and Sinking Fund"means the interest and sinking fund established by Section 2.2 of this Ordinance. InitialCertificate"meanstheinitialcertificateauthorizedbySection3.4(d)of this Ordinance. Interest Payment Date"means each February 1and August 1,commencing August 1, 2014,unlessotherwisedesignatedinthePricingCertificate. Maturity"means the date on which the principal of the Certificates become due and payable according tothe terms thereof,orby proceedings for prior redemption. MSRB"meanstheMunicipalSecuritiesRulemakingBoard. NetRevenues"meanstherevenuestobederivedfromtheSystem,afterthepayment of all operation and maintenance expenses thereof. 4465101.6 Ordinance"asusedhereinandintheCertificatesmeansthisordinanceauthorizingthe Certificates. Owner"means the person whoisthe registered owner of a Certificate or Certificates,as shown intheRegister. Paying Agent/Registrar"meansThe Bank of New York Mellon Trust Company,N.A., unless otherwise designated inthe Pricing Certificate. Paying Agent/Registrar Agreement"meansthe Paying Agent/Registrar Agreement betweenthePaying Agent/Registrar andtheCityrelatingtotheCertificates. Pricing Certificate"meansacertificateor certificates tobe signed bythe Authorized Officer,insubstantiallytheformattachedheretoasExhibitAwithsuchvariations,omissions andinsertionsasareapprovedbytheAuthorizedOfficerasindicatedbyhis/hersignature. Purchase Contract"meansthePurchaseContract between theCityandthe Underwriter providingforthesale of theCertificatestotheUnderwriter. Record Date"means the fifteenth (15th)day of the month preceding each Interest PaymentDate,unlessotherwisedesignatedinthePricingCertificate. Register"meansthebondregisterspecifiedinSection3.6(a)of thisOrdinance. Representation Letter"means the Blanket Letter of Representations between theCity and DTC. Rule"means SEC Rule 15c2-12,as amended from time to time. SEC"means the United States Securities and Exchange Commission. Special Payment Date"means thedatethatis fifteen (15)daysafterthe Special Record Date,as described in Section 3.3(e). Special Record Date"means anew record date for interest payment established inthe event ofa nonpayment of interest ona scheduled date,andfor thirty (30)days thereafter,as described in Section 3.3(e). State"means the State of Texas. Stated Maturity"means the respective stated maturity dates ofthe Certificates specified inthePricingCertificate. System"as used inthis Ordinance means theCity's waterworks and sanitary sewer system. Unclaimed Payments"means money deposited with the Paying Agent/Registrar forthe payment of principal,redemption premium,if any,or interest on the Certificates as the same becomes due and payable or money set aside for the payment of Certificates duly called for 4- 4465101.6 redemption prior to maturity and remaining unclaimed bythe Owners of such Certificates for90 daysafterthe applicable payment or redemption date. Underwriter"meansthesyndicate of underwriters designated inthePricingCertificate. Section 1.2.Findings. The declarations,determinations,andfindingsdeclared,made,andfoundinthe preamble tothis Ordinance are hereby adopted,restated,andmadeapart of the operative provisions hereof. Section 1.3.Table of Contents,Titles,and Headings. Thetable of contents,titles,andheadings of theArticlesand Sections of this Ordinance have been inserted for convenience of reference onlyandarenottobe considered a part hereof andshallnotinanywaymodifyorrestrictany of thetermsorprovisions hereof andshallnever beconsideredorgivenanyeffectinconstruingthisOrdinanceorany provision hereof orin ascertainingintent,if anyquestion of intentshouldarise. Section 1.4.Interpretation. a)Unlessthecontextrequires otherwise,words of themasculinegendershallbe construedtoinclude correlative words of thefeminineand neuter genders andviceversa,and words of thesingularnumbershallbeconstruedtoincludecorrelativewords of thepluralnumber and vice versa. b)AnyactionrequiredtobetakenonadatewhichisnotaBusinessDayshallbe takenonthenextsucceedingBusinessDayandhavethesameeffectas if takenonthedateso required. c)ThisOrdinanceandallthetermsandprovisionshereofshallbeliberally construedtoeffectuatethepurposessetforthhereintosustainthevalidity of thisOrdinance. d)Articleandsectionreferencesshallmeanreferencestoarticlesandsections of this Ordinanceunless otherwise designated. ARTICLE II TAX LEVY;INTEREST AND SINKING FUND;PLEDGE OF REVENUES Section 2.1.Tax Lew. a)PursuanttotheauthoritygrantedbytheTexasConstitutionandthelaws of the State of Texas,thereshallbeleviedandthereisherebyleviedforthe current yearandforeach succeeding year thereafter while anyofthe Certificates orany interest thereon is outstanding and unpaid,anad valorem taxon each one hundred dollars valuation of taxable property within the City,ata rate sufficient,within the limit prescribed by law,topaythedebt service requirements ofthe Certificates,being(i)the interest onthe Certificates,and(ii)a sinking fundfortheir 4465101.6 redemptionatmaturityorasinkingfund of 2%perannum (whichever amountis greater),when dueandpayable,fullallowance being madefordelinquenciesandcosts of collection. b)Thead valorem taxthusleviedshallbeassessedand collected eachyearagainst allpropertyappearingonthetaxrolls of theCitymostrecentlyapprovedinaccordance with law andthe money thus collected shallbe deposited as collected totheInterestand Sinking Fund. c)Saidad valorem tax,the collections therefrom,andall amounts on deposit inor requiredherebytobedepositedtotheInterestand Sinking Fundareherebypledgedand committed irrevocablytothe payment of theprincipal of andinterestonthe Certificates and relatedfeesand expenses when andasdueandpayableinaccordance with theirtermsandthis Ordinance. d)TopayDebtServiceonthe Certificates comingdue prior toreceipt of thetaxes leviedtopaysuchDebtService,thereishereby appropriated fromcurrentfundsonhand,which areherebycertifiedtobeonhandand available forsuchpurpose,anamount sufficient topay suchdebtservice,andsuch amount shallbeusedfornootherpurpose. Section 2.2.Interest and Sinking Fund. a)TheCityhereby establishes a special fundoraccounttobe designated the"City of Baytown,Texas Combination Tax and Revenue Certificates of Obligation,Series 2014, Interest andSinking Fund"(the "Interest and Sinking Fund")withsaid fund tobe maintained at an official depository bank of theCity separate and apart from all other funds and accounts of the City. b)Moneyondepositin,or required bythis Ordinance tobe deposited to,the Interest and Sinking Fund shall beusedsolely for the purpose of paying the interest onand principal of the Certificates whenandasdueand payable in accordance withtheirtermsandthis Ordinance. Section 2.3.Pledge of Revenues. TheNet Revenues tobederivedfromtheoperation of the System inanamountnotto exceedOneThousand Dollars ($1,000)are herebypledgedtothepayment of the principal of and interestontheCertificatesasthesamecomedue;provided,however,thatsuchpledgeisand shall be junior and subordinate in all respects tothe pledge of theNet Revenues tothe payment of all outstanding obligations of theCity and any obligation of theCity,whether authorized heretofore or hereafter,whichtheCity designates ashavingapledgeseniortothepledge of the NetRevenuestothepayment of the Certificates.TheCity also reserves the right to issue,for any lawful purpose atanytime,inoneor more installments,bonds,certificates of obligation and other obligations of any kind payable in whole orin part from theNet Revenues,secured bya pledge of theNet Revenues that maybe prior and superior in right to,ona parity with,or junior and subordinate tothepledge ofNetRevenuessecuringtheCertificates. 4465101.6 ARTICLE III AUTHORIZATION;GENERAL TERMS AND PROVISIONS REGARDING THE CERTIFICATES Section 3.1.Authorization. TheCertificatesareherebyauthorizedtobeissuedanddeliveredinaccordancewiththe Constitution andlaws of theState,specificallytheActand Chapter 1371.The Certificates shall beissuedinatotalaggregateprincipalamountnottoexceed $12,500,000 forthecostsassociated withthe(i)repairandrenovationof,theconstruction of improvements toandtheequipment of the City's waterworksandsanitarysewersystem,(ii)repairandrenovationof,theconstruction of improvementstoandtheequipment of theCity'sparksandrecreationalfacilities,and(iii) cost of professionalservicesincurredinconnectiontherewith. Section 3.2.Date.Denomination.Maturities,and Interest. a)The Certificates shall be dated the Dated Dateandshallbeissuedin fully registeredform,withoutcoupons. b)The Certificates shall be issued inthe aggregate principal amount designated in the Pricing Certificate,shall beinthe denomination of $5,000 principal amount orany integral multiple thereof and shall be numbered separately from one upward,except the Initial Certificate, which shall be numbered 1-1. c)The Certificates shall mature onthe dates andinthe principal amounts and shall bear interest attheperannumratesset forth inthe Pricing Certificate. d)Interest shall accrue and be paid on each Certificate,respectively,until the principal amount thereof has been paid or provision for such payment has been made,from the later of(i)the Closing Date or such other date asset forth inthe Pricing Certificate or(ii)the most recent Interest Payment Dateto which interest hasbeenpaidorprovidedforattherateper annum foreach respective maturity specified inthe Pricing Certificate.Such interest shallbe payable on each Interest Payment Date and shall be computed onthe basis ofa 360-day year of twelve 30-day months. Section 3.3.Medium.Method and Place of Payment. a)Debt Service shall be paid in lawful money ofthe United States of America. b)Interest on each Certificate shall be paid by check dated asofthe Interest Payment Date,andsent first class United States mail,postage prepaid,bythe Paying Agent/Registrar to eachOwner,asshownintheRegisteratthecloseofbusinessontheRecordDate,attheaddress of each such Owner assuch appears inthe Register orbysuchother customary banking arrangements acceptable to the Paying Agent/Registrar and the person to whom interest isto be paid;provided,however,that such person shall bear all risk and expense of such other customary banking arrangements. 4465101.6 c)The principal of each Certificate shallbepaidtotheOwner thereof atMaturity upon presentation and surrender of such Certificate atthe Designated Payment/Transfer Office of thePaying Agent/Registrar. d)If thedateforthepayment of DebtServiceisnotaBusinessDay,thedatefor suchpayment shall bethenext succeeding Business Day,andpaymentonsuch date shall for all purposes bedeemedtohavebeenmadeonthedue date thereofasspecifiedinthis Section. e)Intheevent of a nonpayment of interest ona scheduled payment date,and for thirty(30)days thereafter,anew record date for such interest payment(a"Special Record Date") willbe established bythe Paying Agent/Registrar,if andwhen funds forthepayment of such interesthavebeenreceivedfromtheCity.Notice of theSpecialRecordDateand of the special payment date of the past due interest (the "Special Payment Date,"which shall be fifteen (15) days after the Special Record Date)shall be sent at least five Business Days prior tothe Special Record Date byUnited States mail,first class,postage prepaid,tothe address of each Owner of a Certificate appearing onthebooks of the Paying Agent/Registrar attheclose of business onthe lastBusinessDay next precedingthedate of mailing of suchnotice. f)Payments shall be segregated ina special account andheldin trust,uninvested by the Paying Agent/Registrar,for the account of the Owner of the Certificates towhichthe Unclaimed Payments pertain.SubjecttoTitle6,Texas Property Code,Unclaimed Payments remaining unclaimed bythe Owners entitled thereto for three (3)years after the applicable payment or redemption date shall be applied tothenext payment or payments onthe Certificates thereafter comingdue and,totheextentanysuchmoney remains afterthe retirement of all outstanding Certificates,shall be paid totheCitytobe used for any lawful purpose.Thereafter, neither theCity,the Paying Agent/Registrar norany other person shall be liable or responsible to any holders of such Certificates for any further payment of such unclaimed moneysoron account of anysuch Certificates,subjecttoTitle6,Texas Property Code. Section 3.4.Execution and Registration of Certificates. a)The Certificates shall beexecutedonbehalf of theCitybytheMayoror Mayor Pro Tern andCity Clerk,bytheir manual or facsimile signatures,andtheofficial seal of theCity shall be impressed or placed in facsimile thereon.Such facsimile signatures onthe Certificates shallhavethesame effect as if each of theCertificateshadbeensigned manually andinperson by each of said officers,and such facsimile seal onthe Certificates shall havethe same effectas if theofficialseal oftheCityhadbeenmanuallyimpresseduponeach ofthe Certificates. b)Intheeventthatanyofficer of theCitywhosemanualorfacsimile signature appears onthe Certificates ceases tobe such officer before the authentication of such Certificates orbeforethe delivery thereof,such signature nevertheless shall bevalidandsufficient for all purposesas if such officer hadremainedinsuchoffice. c)Exceptas provided below,no Certificate shall bevalidor obligatory for any purpose orbe entitled toany security or benefit of this Ordinance unless and until there appears thereon the Certificate of Paying Agent/Registrar substantially intheform provided herein,duly authenticated by manual execution by an officer orduly authorized signatory of the Paying 8- 4465101.6 Agent/Registrar.Itshallnotberequiredthatthesame officer or authorized signatory of the Paying Agent/Registrar sign the Certificate of Paying Agent/Registrar onall of the Certificates. In lieu of the executed Certificate of Paying Agent/Registrar described above,the Initial Certificate delivered attheClosingDateshallhaveattached thereto the Comptroller's Registration Certificate substantially intheform provided herein,manually executed bythe Comptroller of Public Accounts of theState,orbyherduly authorized agent,which certificate shallbeevidencethatthe Certificate hasbeenduly approved bythe Attorney General of the State,andthatitisavalidandbinding obligation of theCity,and that ithasbeen registered by theComptroller of PublicAccounts of theState. d)OntheClosingDate,oneInitialCertificaterepresentingtheentireprincipal amount of theCertificatesdesignatedinthePricingCertificate,payableinstatedinstallmentsto the Underwriter orits designee,executed bythemanualor facsimile signatures of the Mayor or MayorProTernandCityClerk,approvedbytheAttorneyGeneral of theState,andregistered andmanually signed bytheComptrollerofPublicAccounts of theState,willbedeliveredtothe Underwriterorits designee.UponpaymentfortheInitialCertificate,thePayingAgent/Registrar shallcanceltheInitialCertificateanddeliverregistereddefinitiveCertificatestoDTCin accordance with Section 3.9hereof.Tothe extent the Paying Agent/Registrar is eligible to participate inDTC's FAST System,as evidenced byan agreement between the Paying Agent/Registrar and DTC,the Paying Agent/Registrar shall holdthe definitive Certificates in safekeeping forDTC. Section 3.5.Ownership. a)The City,the Paying Agent/Registrar andanyother person maytreatthe Owner astheabsoluteowner of suchCertificateforthepurpose of makingandreceivingpaymentofthe principal thereof,forthe purpose of making and receiving payment ofthe interest thereon subject tothe provisions herein thatthe interest istobepaidtothe person in whose name the Certificate is registered onthe Record Date or Special Record Date,as applicable),andforall other purposes,whether ornot such Certificate is overdue,and neither the City northe Paying Agent/Registrar shallbeboundbyany notice or knowledge tothe contrary. b)All payments made tothe Owner ofa Certificate shall be valid and effectual and shall discharge the liability ofthe City and the Paying Agent/Registrar upon such Certificate to the extent of thesumspaid. Section 3.6.Registration.Transfer,and Exchange. a)So long as any Certificates remain outstanding,the City shall cause the Paying Agent/Registrar to keep atits Designated Payment/Transfer Office a register (the "Register")in which,subject to such reasonable regulations asit may prescribe,the Paying Agent/Registrar shall provide for the registration and transfer of Certificates in accordance with this Ordinance. b)The ownership ofa Certificate may be transferred only upon the presentation and surrender ofthe Certificate tothe Paying Agent/Registrar atthe Designated Payment/Transfer Officewithsuch endorsement orother instrument of transfer and assignment asis acceptable to 9- 4465101.6 thePaying Agent/Registrar.No transfer of any Certificate shallbe effective untilenteredinthe Register. c)The Certificates shall be exchangeable uponthe presentation and surrender thereofatthe Designated Payment/Transfer Office for a Certificate or Certificates of thesame maturityandinterest rate andinany denomination or denominations of any integral multiple of 5,000,andinan aggregate principal amountequaltotheunpaid principal amount of the Certificatespresentedforexchange. d)ThePayingAgent/Registrarisherebyauthorizedto authenticate anddeliver Certificates transferred orexchangedin accordance withthisSection.AnewCertificateor CertificateswillbedeliveredbythePayingAgent/Registrar,inlieu of theCertificatebeing transferred orexchanged,attheDesignatedPayment/Transfer Office,orsentbyUnitedStates mail,firstclass,postage prepaid,totheOwnerorhis designee.EachCertificatedeliveredbythe Paying Agent/Registrar in accordance withthisSectionshallconstitutean original contractual obligation of theCityandshallbeentitledtothebenefitsandsecurity of this Ordinance tothe same extent as the Certificate or Certificates in lieu of which such Certificate is delivered. e)Noservice charge shall bemadetotheOwnerfortheinitial registration, subsequent transfer,or exchange for adifferent denomination of any of the Certificates.The Paying Agent/Registrar,however,may require theOwnertopayasumsufficienttocoveranytax orother governmental chargethatis authorized tobeimposedinconnectionwiththe registration, transfer,or exchange of a Certificate. f)NeithertheCitynorthe Paying Agent/Registrar shallbe required to transfer or exchange any Certificate called for redemption,inwholeorin part,within45days prior tothe datefixedforredemption;provided,however,suchlimitationshallnotbeapplicabletoan exchangebytheOwner of theuncalledbalance of aCertificate. Section 3.7.Cancellation. AllCertificatespaidorredeemedbeforeStatedMaturityinaccordancewiththis Ordinance,andall Certificates inlieu of whichexchange Certificates or replacement Certificates are authenticated and delivered inaccordance with thisOrdinance,shallbe cancelled andproper records made regarding suchpayment,redemption,exchange,orreplacement.ThePaying Agent/Registrarshalldispose of suchcancelledCertificatesinthemannerrequiredbythe Securities Exchange Act of 1934,asamended. Section 3.8.Replacement Certificates. a)Uponthe presentation and surrender tothePayingAgent/Registrar of amutilated Certificate,thePayingAgent/Registrarshallauthenticateanddeliverinexchangetherefora replacement Certificate of liketenorand principal amount,bearinganumbernot contemporaneously outstanding.TheCityorthe Paying Agent/Registrarmay require theOwner of such Certificate topayasumsufficienttocoveranytaxorothergovernmental charge thatis authorized tobeimposedinconnectiontherewithandanyotherexpensesconnectedtherewith. 10- 4465101.6 b)Inthe event thatanyCertificateislost,apparently destroyed or wrongfully taken, thePaying Agent/Registrar,pursuanttotheapplicablelaws of theState of Texas andinthe absence of noticeor knowledge thatsuchCertificatehasbeenacquiredbyabonafide purchaser, shallauthenticateand deliver a replacement Certificate of like tenorandprincipal amount, bearinga number not contemporaneously outstanding,provided thatthe Owner first complies with the following requirements: i)furnishestothePaying Agent/Registrar satisfactory evidence of hisorher ownership of andthecircumstances of theloss,destruction,or theft of suchCertificate; ii)furnishessuchsecurityor indemnity as may berequired by thePaying Agent/Registrar tosaveitandtheCityharmless; iii)paysallexpensesand charges inconnectiontherewith,including,butnot limitedto,printingcosts,legalfees,fees of thePaying Agent/Registrar,andanytaxor othergovernmentalchargethatisauthorizedtobeimposed;and iv)satisfiesanyother reasonable requirementsimposedbytheCityandthe Paying Agent/Registrar. c)If,afterthedelivery of such replacement Certificate,abonafide purchaser of the original Certificate inlieu of whichsuch replacement Certificate wasissued presents forpayment such original Certificate,theCityandthe Paying Agent/Registrarshallbeentitledtorecoversuch replacement Certificate from the person towhomitwas delivered orany person taking therefrom,exceptabona fide purchaser,and shall beentitledto recover uponthe security or indemnity provided therefor totheextent of any loss,damage,cost,or expense incurred bythe Cityorthe Paying Agent/Registrar in connection therewith. d)Intheeventthatanysuch mutilated,lost,apparently destroyed,or wrongfully takenCertificatehasbecomeorisabouttobecomedueandpayable,thePayingAgent/Registrar, inits discretion,instead of issuinga replacement Certificate,maypaysuch Certificate whenit becomes dueandpayable. e)Each replacement Certificate delivered in accordance withthisSection shall constitute an original additional contractual obligation of theCityandshallbeentitledtothe benefitsand security of this Ordinance tothe same extentasthe Certificate or Certificates inlieu of whichsuchreplacementCertificateisdelivered. Section 3.9.Book-Entrv-Onlv System. a)Unless otherwise specified inthe Pricing Certificate,the definitive Certificates shall be initially issuedinthe form of a separate singlefully registered Certificate for each maturity.Uponinitial issuance,the ownership of eachsuch Certificate shallbe registered inthe name of Cede&Co.,asnominee of DTC,andexceptasprovidedinSection3.10hereof,all of the outstanding Certificates shall be registered inthe name of Cede &Co.,as nominee of DTC. b)With respect to Certificates registered inthe name of Cede &Co.,as nominee of DTC,theCity and the Paying Agent/Registrar shall have no responsibility or obligation toany 11- 4465101.6 DTCParticipantortoanypersonon behalf of whom suchaDTCParticipantholdsaninterestin theCertificates,except asprovidedinthisOrdinance.Without limiting the immediately precedingsentence,theCityandthePaying Agent/Registrar shall have no responsibility or obligation with respectto(i)theaccuracy of therecords of DTC,Cede&Co.oranyDTC Participant with respecttoany ownership interestintheCertificates,(ii)the delivery toanyDTC Participantoranyotherperson,otherthananOwner,as shown ontheRegister,of anynotice withrespecttotheCertificates,including anynotice of redemption,or(iii)the payment toany DTCParticipantoranyotherperson,otherthananOwner,as shown inthe Register of any amount with respecttoprincipalof,premium,if any,orinterestontheCertificates. Notwithstanding anyother provision of thisOrdinancetothecontrary,the City andthePaying Agent/RegistrarshallbeentitledtotreatandconsiderthepersoninwhosenameeachCertificate isregisteredintheRegisterastheabsoluteOwner of suchCertificateforthepurpose of payment of principal of,premium,if any,andinterestontheCertificates,forthepurpose of givingnotices of redemptionandothermatterswithrespecttosuch Certificate,forthe purpose of registering transferwithrespecttosuchCertificate,andforallotherpurposeswhatsoever.ThePaying Agent/Registrarshallpayall principal of,premium,if any,andinterestontheCertificatesonlyto oruponthe order of therespective Owners,asshownintheRegisterasprovidedinthis Ordinance,ortheirrespectiveattorneysduly authorized inwriting,andallsuchpaymentsshall bevalidand effective tofullysatisfyand discharge the City's obligationswithrespecttopayment of principal of,premium,if any,and interest onthe Certificates totheextent of thesumorsums so paid.No person other than an Owner,as shown inthe Register,shall receive a certificate evidencing the obligation of theCitytomake payments of amounts due pursuant tothis Ordinance.Upon delivery by DTC tothe Paying Agent/Registrar of written notice totheeffect thatDTChasdeterminedtosubstituteanewnomineeinplace of Cede&Co.,andsubjecttothe provisions inthis Ordinance with respect to interest checks or drafts being mailed tothe registered Owner atthe close of business onthe Record Date,the word "Cede&Co."inthis Ordinance shall refer to such new nominee of DTC. c)The Representation Letter previously executed and delivered bytheCity,and applicable totheCity's obligations delivered in book entry only form to DTC as securities depository,ishereby ratified and approved for the Certificates. Section3.10.Successor Securities Depository:TransferOutsideBook-Entry-Only System. IntheeventthattheCity determines thatitisinthebest interest of theCityandthe beneficial owners of the Certificates thattheybeabletoobtaincertificated Certificates,orinthe event DTC discontinues theservicesdescribedherein,the City shall(i)appointasuccessor securities depository,qualified toactas such under Section 17(a)of the Securities Exchange Act of 1934,as amended,notifyDTCandDTC Participants of the appointment of such successor securities depository and transfer oneor more separate Certificates tosuch successor securities depository;or (ii)notify DTC and DTC Participants of the availability through DTC of certificatedCertificatesandcausethePayingAgent/Registrartotransferoneormore separate registered Certificates to DTC Participants having Certificates credited to their DTC accounts. Insuchevent,the Certificates shall no longer be restricted tobeing registered intheRegisterin thename of Cede&Co.,asnominee of DTC,butmayberegisteredinthename of thesuccessor 12- 4465101.6 securitiesdepository,oritsnominee,orinwhatevernameornamesOwnerstransferringor exchangingCertificatesshalldesignate,inaccordancewiththeprovisions of thisOrdinance. Section 3.11.Payments to Cede &Co. Notwithstanding anyotherprovision of thisOrdinancetothecontrary,solongasthe Certificatesareregisteredinthename of Cede&Co.,asnominee of DTC,allpaymentswith respecttoprincipalof,premium,if any,andinterestonsuchCertificates,andallnoticeswith respecttosuchCertificatesshallbemadeandgiven,respectively,inthemannerprovidedinthe RepresentationLetter of theCitytoDTC. ARTICLE IV REDEMPTION OF CERTIFICATES BEFORE MATURITY Section 4.1.Limitation on Redemption. TheCertificatesshallbesubjecttoredemptionbeforeStatedMaturityonlyasprovidedin this Article IVandinthe Pricing Certificate. Section4.2.OptionalRedemption. TheCertificatesshallbesubjecttoredemptionpriortomaturityattheoption of theCity atsuchtimes,insuchamounts,insuchmannerandatsuchredemptionpricesasmaybe designatedandprovidedforinthePricingCertificate. Section 4.3.Mandatory Sinking Fund Redemption. a)The Certificates designated as"Term Certificates"inthePricing Certificate Term Certificates"),if any,are subject to scheduled mandatory redemption andwillbe redeemed bytheCity,inpartataprice equal tothe principal amount thereof,without premium, plus accrued interest tothe redemption date,outof moneys available forsuch purpose inthe InterestandSinkingFund,onthedatesandinthe respective principalamountsassetforthinthe PricingCertificate. b)Priortoeach scheduled mandatory redemption date,thePaying Agent/Registrar shallselectfor redemption bylot,orbyanyother customary methodthatresultsina random selection,a principal amount of Term Certificates equal tothe aggregate principal amount of suchTerm Certificates toberedeemed,shallcallsuchTerm Certificates for redemption onsuch scheduledmandatoryredemptiondate,andshallgivenotice of suchredemption,asprovidedin Section 4.5. c)Theprincipalamount of theTermCertificatesrequiredtoberedeemedonany redemption date pursuant to subparagraph (a)ofthis Section 4.3 shall be reduced,atthe option of the City,bythe principal amount ofanyTerm Certificates which,atleast45dayspriortothe mandatory sinking fund redemption date(i)shallhavebeen acquired bytheCityatapricenot exceeding the principal amount ofsuch Term Certificates plus accrued interest tothedateof purchase thereof,and delivered tothe Paying Agent/Registrar for cancellation,or(ii)shall have 13- 4465101.6 beenredeemedpursuanttotheoptionalredemptionprovisions hereof andnot previously credited toa mandatory sinking fund redemption. Section 4.4.Partial Redemption. a)If lessthanall of theCertificatesaretobe redeemed pursuantto Section 4.2 hereof,theCityshalldeterminethematurityormaturitiesandtheamounts thereof tobe redeemedandshalldirectthePaying Agent/Registrar tocall by lot,orother customary method thatresultsinrandomselection,theCertificates,orportions thereof,within such maturity or maturitiesandinsuchprincipalamountsforredemption. b)A portion of asingle Certificate of a denomination greater than$5,000maybe redeemed,butonlyinaprincipalamountequalto$5,000oranyintegralmultiplethereof.If sucha Certificate istobe partially redeemed,the Paying Agent/Registrarshalltreateach$5,000 portion of the Certificate asthoughitwerea single Certificate for purposes of selection for redemption. c)Upon surrender of any Certificate forredemptionin part,the Paying Agent/Registrar,in accordance withSection3.6 of this Ordinance,shall authenticate anddeliver an exchange Certificate or Certificates inan aggregate principal amount equal tothe unredeemed portion of the Certificate so surrendered,such exchange beingwithout charge. d)The Paying Agent/Registrar shall promptly notifytheCityin writing of the principal amount tobe redeemed of any Certificate astowhichonlya portion thereofistobe redeemed. Section4.5.Notice of Redemption toOwners. a)The Paying Agent/Registrar shall give notice of any redemption of Certificates by sending notice by first class United States mail,postage prepaid,notless than thirty (30)days beforethedatefixedfor redemption,totheOwner of eachCertificate(or part thereof)tobe redeemed,atthe address shownontheRegisterattheclose of businessontheBusinessDaynext precedingthedate of mailingsuchnotice. b)Thenoticeshallstatethe redemption date,theredemption price,theplaceat whichtheCertificatesaretobe surrendered forpayment,and,if lessthanalltheCertificates outstanding are tobe redeemed,an identification of the Certificates or portions thereoftobe redeemed. c)TheCity reserves the right togive notice of its election or direction to redeem Certificates underSection4.2 conditioned uponthe occurrence of subsequentevents.Such notice may state (i)thatthe redemption is conditioned uponthe deposit of moneys and/or authorizedsecurities,inanamountequaltotheamountnecessaryto effect theredemption,with the Paying Agent/Registrar,or such other entity as maybe authorized by law,no later than the redemption date or (ii)that theCity retains the right to rescind such notice atanytime prior tothe scheduled redemption date if theCity delivers a certificate of theCitytothe Paying Agent/Registrar instructing the Paying Agent/Registrar to rescind the redemption notice,and such notice and redemption shall be of noeffect if suchmoneys and/or authorized securities are 14- 4465101.6