Ordinance No. 9,505ORDINANCE NO. 9505
® AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS, AUTHORIZING THE ISSUANCE OF $7,355,000 CITY OF BAYTOWN
TEXAS, GENERAL OBLIGATION BONDS, SERIES 2003; AND PROVIDING
FOR THE EFFECTWE DATE THEREOF.
WHEREAS, the bonds hereinafter authorized were duly and favorably voted at an election
held in the City of Baytown, Texas (the "City ") on the 5th day of May, 2001; and
WHEREAS, the City Council of the City does hereby determine that bonds should be issued
in the amount of $7,355,000 as a portion and the second installment of the $29,490,000 tax bonds
voted at the election mentioned above, said bonds having been authorized for the purposes and
issued in the amounts shown below:
NOW THEREFORE
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS:
Section 1. Definitions. Throughout this Ordinance the following terms and expressions
as used herein shall have the meanings set forth below:
"Act" means Chapter 1331, Texas Government Code, as amended.
"Blanket Issuer Letter of Representations" means the Blanket Issuer Letter of Representations
between the City, the Registrar and DTC.
"Bonds" means the $7,355,000 City of Baytown, Texas, General Obligation Bonds, Series
2003, authorized in this Ordinance, unless the context clearly indicates otherwise.
® 'Business Day" means any day which is not a Saturday, Sunday, or a day on which the
Registrar is authorized by law or executive order to close.
Amount
Prior
Purpose
Authorized
Issue
This Issue
Unissued
Street Improvements
$20,375,000
$4,000,000
$4,800,000
$11,575,000
Drainage Improvements
3,250,000
650,000
900,000
1,700,000
Fire Fighting Facilities and
Equipment
2,175,000
350,000
1,000,000
825,000
Communications Equipment
2,090,000
730,000
455,000
905,000
Community Center
Improvements
1,250,000
1,250,000
0
0
Park Improvements
350,000
100,000
125,000
125,000
TOTAL
$29,490,000
$7,080,000
$7,280,000
$15,130,000
NOW THEREFORE
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS:
Section 1. Definitions. Throughout this Ordinance the following terms and expressions
as used herein shall have the meanings set forth below:
"Act" means Chapter 1331, Texas Government Code, as amended.
"Blanket Issuer Letter of Representations" means the Blanket Issuer Letter of Representations
between the City, the Registrar and DTC.
"Bonds" means the $7,355,000 City of Baytown, Texas, General Obligation Bonds, Series
2003, authorized in this Ordinance, unless the context clearly indicates otherwise.
® 'Business Day" means any day which is not a Saturday, Sunday, or a day on which the
Registrar is authorized by law or executive order to close.
9 "City" means the City of Baytown, Texas.
"Closing Date" means the date of the initial delivery of and payment for the Bonds.
"Code" means the Internal Revenue Code of 1986, as amended.
"Comptroller" means the Comptroller of Public Accounts of the State of Texas.
"Debt Service Fund" means the debt service fund for payment of the Bonds established by the
City in Section 19 of this Ordinance.
"DTC" means The Depository Trust Company of New York, New York, or any 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 to facilitate the
clearance and settlement of securities transactions among DTC Participants.
"Initial Bond" means the Initial Bond authorized by Section 5(d).
"Interest Payment Date ", when used in connection with any Bond, means August 1, 2003, and
each February 1 and August 1 thereafter until maturity or earlier redemption.
"MSRB" means the Municipal Securities Rulemaking Board.
"NRMSIR" means each person whom the SEC or its staff has determined to be a nationally
recognized municipal securities information repository within the meaning of the Rule from time to
time.
"Ordinance" as used herein and in the Bonds means this ordinance authorizing the Bonds.
"Owner" means any person who shall be the registered owner of any outstanding Bond.
"Record Date" means, for any Interest Payment Date, the fifteenth day of the month next
preceding each Interest Payment Date.
"Register" means the books of registration kept by the Registrar, in which are maintained the
names and addresses of, and the principal amounts of the Bonds registered to, each Owner.
"Registrar" means JPMorgan Chase Bank, and its successors in that capacity.
"Rule" means SEC Rule 15c2 -12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
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"SID" means the Municipal Advisory Council of Texas, which has been designated by the
State of Texas as, and determined by the SEC staff to be, a state information depository within the
meaning of the Rule.
Section 2. Authorization. The matters and facts recited in the preamble to this Ordinance
are hereby found to be true and correct. The Bonds shall be issued, pursuant to the Act, in fully
registered form in the aggregate principal amount of Seven Million Three Hundred Fifty -Five
Thousand Dollars ($7,355,000) with the amount for each purpose being as described in the preamble
to this Ordinance:
(1) street improvements;
(ii) drainage improvements;
(iii) fire fighting facilities and equipment;
(iv) communications equipment; and
(v) park improvements,
Section 3. Designation, Date, and Interest Payment Dates. The Bonds shall be
designated as "CITY OF BAYTOWN, TEXAS, GENERAL OBLIGATION BONDS, SERIES 2003"
and shall be dated March 1, 2003. The Bonds shall bear interest at the rates set forth in Section 4 of
this Ordinance from the later of March 1, 2003, or the most recent Interest Payment Date to which
such interest has been paid or duly provided for, calculated on the basis of a 360 day year of twelve
30 day months, interest payable on August 1, 2003, and semiannually thereafter on February 1 and
August 1 of each year until maturity or earlier redemption.
Section 4. Principal Amounts and Interest Rates, Numbers and Denominations. The
Bonds shall be issued in the principal amounts and bearing interest at the rates set forth in the
following schedule, and maybe transferred and exchanged asset out in this Ordinance. The Bonds
shall mature on February 1 in each of the years and in the amounts set out in such schedule. The
Initial Bond shall be numbered 1 -1 and all other Bonds shall be numbered in sequence beginning
with R -1. Bonds delivered on transfer of or in exchange for other Bonds shall be numbered in order
of their authentication by the Registrar, shall be in the denomination of $5,000 or integral multiples
thereof, and shall mature on the same date and bear interest at the same rate as the Bond or Bonds in
lieu of which they are delivered.
Year
2004
2005
2006
2007
2008
2009
2010
Principal
Amount
$250,000
255,000
260,000
270,000
280,000
290,000
300,000
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Interest
Rate
%
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2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
310,000
325,000
340,000
355,000
375,000
390,000
410,000
430,000
455,000
475,000
500,000
530,000
555,000
Section 5. Execution of Bonds• Seal. (a) The Bonds shall be signed by the Mayor Pro
Tern and countersigned by the City Clerk, by their manual, lithographed, or facsimile signatures, and
the official seal of the City shall be impressed or placed in facsimile thereon. Such facsimile
signatures on the Bonds shall have the same effect as if each of the Bonds had been signed manually
and in person by each of said officers, and such facsimile seal on the Bonds shall have the same
effect as if the official seal of the City had been manually impressed upon each of the Bonds.
(b) If any officer of the City whose manual or facsimile signature shall appear on the
Bonds shall cease to be such officer before the authentication of such Bonds or before the delivery of
such Bonds, such manual or facsimile signature shy ll nevertheless be valid and sufficient for all
purposes as if such officer had remained in such office.
(c) Except as provided below, no Bond shall be valid or obligatory for any purpose or be
entitled to any security or benefit of this Ordinance unless and until there appears thereon the
Registrar's Authentication Certificate substantially in the form provided herein, duly authenticated by
manual execution by an officer or duly authorized signatory of the Registrar. In lieu of the executed
Registrar's Authentication Certificate described above, the Initial Bond delivered at the Closing Date
shall have attached hereto the Comptroller's Registration Certificate substantially in the forni
provided herein, manually executed by the Comptroller, or by his duly authorized agent, which
certificate shall be evidence that the Initial Bond has been duly approved by the Attorney General
and that it is a valid and binding obligation of the City, and has been registered by the Comptroller.
(d) On the Closing Date, the Initial Bond, being a single bond representing the entire
principal amount of the Bonds, payable in stated installments to the Underwriter or its designee,
executed by manual or facsimile signature of thel Mayor Pro Tern and City Clerk of the City,
approved by the Attorney General, and registered and manually signed by the Comptroller, shall be
delivered to the Underwriter or its designee. Upon payment for the Initial Bond, the Registrar shall
cancel the Initial Bond and deliver definitive bonds to DTC.
Section 6. Payment of Principal and Interest. The Registrar is hereby appointed as the
paying agent and registrar for the Bonds. The principal of the Bonds shall be payable, without
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exchange or collection charges, in any coin or current
date of payment is legal tender for the payment of deb
presentation and surrender as they respectively becc
earlier redemption, at the principal payment office of
be payable on each Interest Payment Date, by check n
Payment Date to the Owner of record as of the Recon
on the Register.
V of the United States of America which on the
s due the United States of America, upon their
me due and payable, whether at maturity or
he Registrar. The interest on each Bond shall
ailed by the Registrar on or before the Interest
Date, to the address of such Owner as shown
If the date for payment of the principal of or interest on any Bond is not a Business Day, then
the date for such payment shall be the next succeeding Business Day with the same force and effect
as if made on the date payment was originally due.
Section 7. Successor Registrars. The City covenants that at all times while any Bonds are
outstanding it will provide a commercial bank or trust company, organized under the laws of the
United States or any state, authorized under such laws to exercise trust powers, and subject to
supervision or examination by federal or state authority, to serve as and perform the duties and
services of Registrar for the Bonds. The City reserves the right to change the Registrar on not less
than 60 days written notice to the Registrar, so long as any such notice is effective not less than 60
days prior to the next succeeding principal or interesti payment date on the Bonds. Promptly upon the
appointment of any successor Registrar, the previous Registrar shall deliver the Register or copies
thereof to the new Registrar, and the new Registrars I hal I notify each Owner, by United States mail,
first class postage prepaid, of such change and of th address of the new Registrar. Each Registrar
hereunder, by acting in that capacity, shall be deemed to have agreed to the provisions of this
Section. I
Section 8. Special Record Date. If interest on any Bond is not paid on any Interest
Payment Date and continues unpaid for thirty (30) days thereafter, the Registrar shall establish a new
record date for the payment of such interest, to be known as a Special Record Date. The Registrar
shall establish a Special Record Date when funds to make such interest payment are received from or
on behalf of the City. Such Special Record Date shall be fifteen (15) days prior to the date fixed for
payment of such past due interest, and notice of the date of payment and the Special Record Date
shall be sent by United States mail, first class, postage prepaid, not later than five (5) days prior to
the Special Record Date, to each affected Owner of record as of the close of business on the day prior
to the mailing of such notice.
Section 9.
other person may treat the person in whose name
such Bond for the purpose of making and receivin
Bond, and for all other purposes, whether or not su
Registrar shall be bound by any notice or knowle
person deemed to be the Owner of any Bond in
effectual and shall discharge the liability of the Cit,
of the sums paid.
0
:ipal and Interest. The City, the Registrar and any
my Bond is registered as the absolute owner of
payment of the principal of or interest on such
h Bond is overdue, and neither the City nor the
ge to the contrary. All payments made to the
ccordance with this Section shall be valid and
and the Registrar upon such Bond to the extent
•
Amounts held by the Registrar which represent principal of and interest on the Bonds
remaining unclaimed by the Owner after the expiration of three years from the date such amounts
have become due and payable shall be reported and disposed of by the Registrar in accordance with
the applicable provisions of Texas law including, to the extent applicable, Title 6 of the Texas
Property Code, as amended.
Section 10. Registration, Transfer, and Exchange. So ' long as any Bonds remain
outstanding, the Registrar shall keep the Register at its principal payment office in Dallas, Texas.
Subject to such reasonable regulations as it may prLscribe, the Registrar shall provide for the
registration and transfer of Bonds in accordance with, I the terms of this Ordinance.
Each Bond shall be transferable only upon
principal payment office of the Registrar In D,
accompanied by an assignment duly executed
representative in form satisfactory to the Registrar. t
the Registrar shall authenticate and deliver in exch,
such presentation, a new Bond or Bonds registered
authorized denominations and of the same maturit,
interest at the same rate as the Bond or Bonds so pr
he presentation and surrender thereof at the
las, Texas, duly endorsed for transfer, or
� the registered Owner or his authorized
)on due presentation of any Bond for transfer,
ge therefor, within three Business Days after
i the name of the transferee or transferees, in
and aggregate principal amount and bearing
All Bonds shall be exchangeable upon presentation and surrender thereof at the principal
payment office in Dallas, Texas, of the Registrar, for a Bond or Bonds of like maturity and interest
rate and in any authorized denomination, in an aggregate amount equal to the unpaid principal
amount of the Bond or Bonds presented for exchange. The Registrar shall be and is hereby
authorized to authenticate and deliver exchange Bonds in accordance with the provisions of this
Section. Each Bond delivered in accordance with this Section shall be entitled to the benefits and
security of this Ordinance to the same extent as the Bond or Bonds in lieu of which such Bond is
delivered,
The City or the Registrar may require the O
any tax or other governmental charge that may
exchange of such Bond. Any fee or charge of the
paid by the City.
er of any Bond to pay a sum sufficient to cover
imposed in connection with the transfer or
gistrar for such transfer or exchange shall be
Section 11. Mutilated, Lost, or Stolen Bonds. Upon the presentation and surrender to the
Registrar of a mutilated Bond, the Registrar shall authenticate and deliver in exchange therefor a
replacement Bond of like maturity, interest rate, and principal amount, bearing a number not
contemporaneously outstanding. If any Bond is lost, apparently destroyed, or wrongfully taken, the
City, pursuant to the applicable laws of the State of Texas and in the absence of notice or knowledge
that such Bond has been acquired by a bona fide purchaser, shall authorize and the Registrar shall
authenticate and deliver a replacement Bond of like maturity, interest rate and principal amount,
bearing a number not contemporaneously outstanding.
The City or the Registrar may require the Owner of a mutilated Bond to pay a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection therewith and any
Ire
other expenses connected therewith, including the fees and expenses of the Registrar. The City or
the Registrar may require the Owner of a lost, apparently destroyed or wrongfully taken Bond, before
any replacement Bond is issued, to:
(1) furnish to the City and the Registrar satisfactory evidence of the ownership of
and the circumstances of the loss, destruction or theft of such Bond;
(2) furnish such security or indemnity as may be required by the Registrar and
the City to save them harmless;
(3) pay all expenses and charges in connection therewith, including, but not
limited to, printing costs, legal fees, fees of the Registrar and any tax or other
governmental charge that may be imposed; and
(4) meet any other reasonable requirements of the City and the Registrar.
If, after the delivery of such replacement Bond, a bona fide purchaser of the original Bond in lieu of
which such replacement Bond was issued presents for payment such original Bond, the City and the
Registrar shall be entitled to recover such replacement Bond from the person to whom it was
delivered or any person taking therefrom, except a bona fide purchaser, and shall be entitled to
recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or
expense incurred by the City or the Registrar in connection therewith.
If any such mutilated, lost, apparently destroyed or wrongfully taken Bond has become or is
about to become due and payable, the City in its discretion may, instead of issuing a replacement
Bond, authorize the Registrar to pay such Bond.
Each replacement Bond delivered in accordance with this Section shall be entitled to the
benefits and security of this Ordinance to the same extent as the Bond or Bonds in lieu of which such
replacement Bond is delivered.
Section 12. Cancellation of Bonds. All Bonds paid in accordance with this Ordinance,
and all Bonds in lieu of which exchange Bonds or replacement Bonds are authenticated and
delivered in accordance herewith, shall be cancelled and destroyed upon the making of proper
records regarding such payment. The Registrar shall furnish the City with appropriate certificates of
destruction of such Bonds.
Section 13. Book -Entry Only (a) The Initial Bond shall be registered in the name
of . Except as provided in Section 14 hereof, all
other Bonds shall be registered in the name of Cede & Co., as nominee of DTC.
(b) With respect to Bonds registered in the name of Cede & Co., as nominee of DTC, the
City and the Registrar shall have no responsibility or obligation to any DTC Participant or to any
person on behalf of whom such DTC Participant holds an interest in the Bonds, except as provided in
this Ordinance. Without limiting the immediately preceding sentence, the City and the Registrar
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® shall have no responsibility or obligation with respect to (1) the accuracy of the records of DTC, Cede
& Co. or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to
any DTC Participant or any other person, other than an Owner, as shown on the Register, of any
notice with respect to the Bonds, including any notice of redemption, or (iii) the payment to any DTC
Participant or any other person, other than an Owner, as shown on the Register, of any amount with
respect to principal of, premium, if any, or interest on the Bonds. Notwithstanding any other
provision of this Ordinance to the contrary, the City and the Registrar shall be entitled to treat and
consider the person in whose name each Bond is registered in the Register as the absolute Owner of
such Bond for the purpose of payment of principal of and interest on the Bonds, for the purpose of
giving notices of redemption and other matters with respect to such Bond, for the purpose of
registering transfer with respect to such Bond, and for all other purposes whatsoever. The Registrar
shall pay all principal of, premium, if any, and interest on the Bonds only to or upon the order of the
respective Owners, as shown in the Register as provided in this Ordinance, or their respective
attorneys duly authorized in writing, and all such payments shall be valid and effective to fully
satisfy and discharge the City's obligations with respect to payments of principal, premium, if any,
and interest on the Bonds to the extent of the sum or sums so paid. No person other than an Owner,
as shown in the Register, shall receive a Bond certificate evidencing the obligation of the City to
make payments of amounts due pursuant to this Ordinance. Upon delivery by DTC to the Registrar
of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede
& Co., and subject to the provisions of this Ordinance with respect to interest checks being mailed to
the Owner of record as of the Record Date, the phrase "Cede & Co." in this Ordinance shall refer to
such new nominee of DTC.
14. Successor Securities Depository; Transfer Outside Book -Entry Only System. In the
event that the City, in its sole discretion, determines that the beneficial owners of the Bonds should
be able to obtain certificated Bonds, or in the event DTC discontinues the services described herein,
the City shall (1) appoint a successor securities depository, qualified to act as such under Section
17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants, as
identified by DTC, of the appointment of such successor securities depository and transfer one or
more separate Bonds to such successor securities depository or (ii) notify DTC and DTC
Participants, as identified by DTC, of the availability through DTC of Bonds and transfer one or
more separate Bonds to DTC Participants having Bonds credited to theirDTC accounts, as identified
by DTC. In such event, the Bonds shall not longer be restricted to being registered in the Register in
the name of Cede & Co., as nominee of DTC, but may be registered in the name of the successor
securities depository, or its nominee, or in whatever name or names Owners transferring or
exchanging Bonds shall designate, in accordance with the provisions of this Ordinance.
Section 15. Payments to Cede & Co. Notwithstanding any other provision of this
Ordinance to the contrary, so long as any Bonds are registered in the name of Cede & Co., as
nominee of DTC, all payments with respect to principal of, premium, if any, and interest on such
Bonds, and all notices with respect to such Bonds, shall be made and given, respectively, in the
manner provided in the Blanket Letter of Representations.
Section 16. Optional and Mandatory Redemption. The Bonds are subject to optional and
mandatory redemption as set forth in the Form of Bonds in this Ordinance.
In
C
Principal amounts may be redeemed only in integral multiples of $5,000. If a Bond subject to
redemption is in a denomination larger than $5,000, a portion of such Bond may be redeemed, but
only in integral multiples of $5,000. Upon surrender of any Bond for redemption in part, the
Registrar, in accordance with Section 10 hereof, shall authenticate and deliver in exchange therefor a
Bond or Bonds of like maturity and interest rate in an aggregate principal amount equal to the
unredeemed portion of the Bond so surrendered.
Notice of any redemption identifying the Bonds to be redeemed in whole or in part shall be
given by the Registrar at least thirty days prior to the date fixed for redemption by sending written
notice by first class mail to the Owner of each Bond to be redeemed in whole or in part at the address
shown on the Register. Such notices shall state the redemption date, the redemption price, the place
at which Bonds are to be surrendered for payment and, if less than all Bonds outstanding of a
particular maturity are to be redeemed, the numbers of the Bonds or portions thereof of such maturity
to be redeemed. Any notice given as provided in this Section shall be conclusively presumed to have
been duly given, whether or not the Owner receives such notice. By the date fixed for redemption,
due provision shall be made with the Registrar for payment of the redemption price of the Bonds or
portions thereof to be redeemed, plus accrued interest to the date fixed for redemption. When Bonds
have been called for redemption in whole or in part and due provision has been made to redeem same
as herein provided, the Bonds or portions thereof so redeemed shall no longer be regarded as
outstanding except for the purpose of receiving payment solely from the funds so provided for
redemption, and the rights of the Owners to collect interest which would otherwise accrue after the
redemption date on any Bond or portion thereof called for redemption shall terminate on the date
fixed for redemption.
Section 17. Forms. The form of the Bonds, including the form of the Registrar's
Authentication Certificate, the form of Assignment, and the form of Registration Certificate of the
Comptroller, which shall be attached or affixed to the Bonds initially issued, shall be, respectively,
substantially as follows, with such additions, deletions and variations as may be necessary or
desirable and not prohibited by this Ordinance, including any legend regarding bond insurance if
such insurance is obtained by the Underwriter:
In
(a) Form of Bonds.
REGISTERED REGISTERED
NUMBER DENOMINATION
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTIES OF HARRIS AND CHAMBERS
CITY OF BAYTOWN, TEXAS
GENERAL OBLIGATION BOND
SERIES 2003
INTEREST RATE: MATURITY DATE: ISSUE DATE: CUSIP:
February 1, 20 March 1, 2003
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
The City of Baytown, Texas (the "City ") promises to pay to the registered owner identified
above, or registered assigns, on the maturity date specified above, upon presentation and surrender of
this Bond to JPMorgan Chase Bank (the "Registrar "), at its principal payment office in Dallas,
Texas, the principal amount identified above, payable in any coin or currency of the United States of
America which on the date of payment of such principal is legal tender for the payment of debts due
the United States of America, and to pay interest thereon at the rate shown above, calculated on the
basis of a 360 day year of twelve 30 day months, from the later of March 1, 2003, or the most recent
interest payment date to which interest has been paid or duly provided for. Interest on this Bond is
payable by check on August 1, 2003, and semiannually thereafter on each February 1 and August 1,
mailed to the registered owner as shown on the books of registration kept by the Registrar as of the
fifteenth day of the month next preceding such interest payment date.
THIS BOND is one of a duly' authorized issue of Bonds, aggregating $7,355,000 (the
'Bonds "), issued for the purposes of acquiring and constructing community center improvements,
street improvements, fire fighting facilities and equipment, communications equipment, and park
improvements, under and in strict conformity with the Constitution and laws of the State of Texas
and by authority of an election held within the City on May 5, 2001 and pursuant to an ordinance
adopted by the City Council (the "Ordinance "), which Ordinance is of record in the official minutes
• of the City Council.
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THE CITY RESERVES THE RIGHT to redeem Bonds maturing on and after February 1,
2014, prior to their scheduled maturities, in whole or from time to time in part, in integral multiples
of $5,000, on February 1, 2013, or any date thereafter at par plus accrued interest on the principal
amounts called for redemption to the date fixed for redemption., Reference is made to the Ordinance
for complete details concerning the manner'of redeeming the Bonds
THE BONDS maturing in the year 20_ (the "Term Bonds') are subject to mandatory
redemption prior to maturity in the amounts and on the dates set out below, at a price equal to the
principal amount to be redeemed plus accrued interest to the redemption date:
TERM BONDS MATURING IN THE YEAR 20
Mandatory Redemption Principal Amount
February 1, 20_ S
February 1, 20_
February 1, 20_ (maturity)
The particular Term Bonds to be redeemed shall be selected by the Registrar by lot or other
customary random selection method, on or before January I of each year in which Term Bonds are
to be mandatorily redeemed. The principal amount of Term Bonds to be mandatorily redeemed in
each year shall be reduced by the principal amount of such Term Bonds that have been purchased
and canceled by the City or have been optionally redeemed and which have not been made the basis
for a previous reduction.
NOTICE OF ANY REDEMPTION shall be given at least thirty (30) days prior to the date
fixed for redemption by first class mail, addressed to the registered owners of each Bond to be
redeemed in whole or in part at the address shown on the books of registration kept by the Registrar.
When Bonds or portions thereof have been called for redemption, and due provision has been made
to redeem the same, the amounts so redeemed shall be payable solely from the funds provided for
redemption, and interest which would otherwise accrue on the amounts called for redemption shall
terminate on the date fixed for redemption.
THIS BOND is transferable only upon presentation and surrender at the principal payment
office of the Registrar in Dallas, Texas, duly endorsed for transfer or accompanied by an assignment
duly executed by the registered owner or his authorized representative, subject to the terms and
conditions of the Ordinance.
THE BONDS are exchangeable at the principal payment office of the Registrar in Dallas,
Texas, for Bonds in the principal amount of $5,000 or any integral multiple thereof, subject to the
terms and conditions of the Ordinance.
L�
THIS BOND shall not be valid or obligatory for any purpose or be entitled to any benefit
under the Ordinance unless this Bond is either (i) registered by the Comptroller of Public Accounts
of the State of Texas by registration certificate attached or affixed hereto or (ii) authenticated by the
Registrar by due execution of the authentication certificate endorsed hereon.
THE REGISTERED OWNER of this Bond, by acceptance hereof, acknowledges and agrees
to be bound by all the terms and conditions of the Ordinance.
THE CITY has covenanted in the Ordinance that it will at all times provide a legally qualified
registrar for the Bonds and will cause notice of any change of registrar to be mailed to each
registered owner.
IT IS HEREBY certified, recited and covenanted that this Bond has been duly and validly
issued and delivered; that all acts, conditions and things required or proper to be performed, to exist
and to be done precedent to or in the issuance and delivery of this Bond have been performed, exist
and have been done in accordance with law; and that annual ad valorem taxes, within the limits
prescribed by law, sufficient to provide for the payment of the interest on and principal of this Bond,
as such interest comes due and such principal matures, have been levied and ordered to be levied
against all taxable property in the City, and have been pledged irrevocably for such payment.
IN WITNESS WHEREOF, this Bond has been signed with the manual or facsimile signature
of the Mayor Pro Tern of the City and countersigned with the manual or facsimile signature of the
City Clerk of the City, and the official seal of the City has been duly impressed, or placed in
facsimile, on this Bond.
(AUTHENTICATION (SEAL)
CERTIFICATE)
(b) Form of Registration Certificate of Comptroller.
COMPTROLLER'S REGISTRATION CERTEF'ICATE: 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.
0 WITNESS MY SIGNATURE AND SEAL this
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® Comptroller of Public Accounts
(SEAL) of the State of Texas
(c) Form of Registrar's Authentication Certificate.
AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been delivered pursuant to the
Ordinance described in the text of this Bond.
JPMorgan Chase Bank
As Paying Agent/Registrar
am
Authorized Signature
Date of Authentication
(d) Form of Assignment.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns, and transfers unto
(Please print or type name, address, and zip code of Transferee)
(Please insert Social Security or Taxpayer Identification Number of Transferee)
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
attorney to transfer said
Bond on the books kept for registration thereof, with full power of substitution in the premises.
DATED:
Signature Guaranteed:
NOTICE: Signature must be
guaranteed by a member firm of the
New York Stock Exchange or a
commercial bank or trust company.
Registered Owner
NOTICE: The signature above must
correspond to the name of the registered
owner as shown on the face of this
Bond in every particular, without any
alteration, enlargement or change
whatsoever.
(e) The Initial Bond shall be in the form set forth in paragraphs (a), (b) and (d) of this
Section, except for the following alterations:
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•
(i) immediately under the name of the Bond, the headings
"INTEREST RATE" and "MATURITY DATE" shall both be
completed with the words "As Shown Below" and the word "CUSIP"
deleted;
(ii) in the first paragraph of the Bond, the words "on the maturity
date specified above" and "at the rate shown above" shall be deleted
and the following shall be inserted at the end of the first sentence "...,
with such principal to be paid in installments on February 1 in each of
the years and in the principal amounts identified in the following
schedule and with such installments bearing interest at the per annum
rates set forth in the following schedule:
[Information to be inserted from schedule in Section 4]
(iii) the Initial Bond shall be numbered I -1.
Section 18. CUSIP Numbers, Bond Insurance. CUSIP Numbers may be printed on the
Bonds, but errors or omissions in the printing of such numbers shall have no effect on the validity of
the Bonds. If bond insurance is obtained by the Underwriter, the Bonds may bear an appropriate
legend as provided by the insurer.
Section 19. Debt Service Fund; Tax Levy. There is hereby established a separate fund of
the City to be known as the City of Baytown, Texas, General Obligation Bonds, Series 2003 Debt
Service Fund (the "Debt Service Fund "), which shall be kept separate and apart from all other funds
of the City. The proceeds from all taxes levied, assessed and collected for and on account of the
Bonds authorized by this Ordinance shall be deposited, as collected, in the Debt Service Fund.
While the Bonds or any part of the principal thereof or interest thereon remain outstanding and
unpaid, there is hereby levied and there shall be annually assessed and collected in due time, form
and manner, and at the same time as other City taxes are assessed, levied and collected, in each year,
a continuing direct annual ad valorem tax, within the limits prescribed by law, upon all taxable
property in the City, sufficient to pay the current interest on the Bonds as the same becomes due and
to provide and maintain a sinking fund of not less than two percent of the principal amount of the
Bonds or the amount required to pay each installment of principal of the Bonds as the same matures,
whichever is greater, full allowance being made for delinquencies and costs of collection, and said
taxes are hereby irrevocably pledged to the payment of the interest on and principal of the Bonds and
to no other purpose.
To pay the debt service coming due on the Bonds prior to receipt of the taxes levied to pay
such debt service, there is hereby appropriated from current funds on hand, which are hereby
certified to be on hand and available for such purpose, an amount sufficient to pay such debt service,
and such amount shall be used for no other purpose.
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® Section 20. Application of Chapter 1208, Government Code. Chapter 1208, Government
Code, applies to the issuance of the Bonds and the pledge of the taxes granted by the City under
Section 19 of this Ordinance, and such pledge is therefore valid, effective and perfected. If Texas
law is amended at any time while the Bonds are outstanding and unpaid such that the pledge of the
taxes granted by the City under Section 19 of this Ordinance is to be .subject to the filing
requirements of Chapter 9, Business & Commerce Code, then in order to preserve to the registered
owners of the Bonds the perfection of the security interest in said pledge, the City agrees to take such
measures as it determines are reasonable and necessary under Texas law to comply with the
applicable provisions of Chapter 9, Business & Commerce Code and enable a filing to perfect the
security interest in said pledge to occur.
Section 21. Further Proceeding. After the Bonds to be initially issued have been
executed, it shall be the duty of the Mayor or Mayor Pro Tem and other appropriate officials and
agents of the City to deliver the Bonds to be initially issued and all pertinent records and proceedings
to the Attorney General, for examination and approval. After the Bonds to be initially issued have
been approved by the Attorney General, they shall be delivered to the Comptroller for registration.
Upon registration of the Bonds to be initially issued, the Comptroller (or the Comptroller's bond
clerk or an assistant bond clerk lawfully designated in writing to act for the Comptroller) shall
manually sign the Comptroller's Registration Certificate prescribed herein and the seal of said
Comptroller shall be impressed, or placed in facsimile, thereon.
Section 22. Sale. The sale and delivery of the Bonds to
(the "Underwriter ") at a price of par, plus a cash premium of
$ , plus accrued interest thereon to date of delivery, is hereby authorized, approved,
ratified and confirmed, subject to the approving opinion as to the legality of the Bonds of the
Attorney General of the State of Texas, and of Vinson & Elkins L.L.P., Houston, Texas, bond
counsel. It is hereby found and declared that the Bonds were sold at public sale and that the bid of
the Underwriter was the best bid received by the City.
Section 23. Federal Income Tax Inclusion.
(a) General Tax Covenant. The City intends that the interest on the Bonds shall be
excludable from gross income for purposes of federal income taxation pursuant to sections 103 and
141 through 150 of the Internal Revenue Code of 1986, as amended (the "Code), and applicable
Income Tax Regulations (the "Regulations "). The City covenants and agrees not to take any action,
or knowingly omit to take any action within its control that, if taken or omitted, respectively, would
cause the interest on the Bonds to be includable in gross income, as defined in section 61 of the
Code, for federal income tax purposes. In particular, the City covenants and agrees to comply with
each requirement of this Section; provided, however, that the City shall not be required to comply
with any particular requirement of this Section if the City has received an opinion of nationally
recognized bond counsel ( "Counsel's Opinion ") that such noncompliance will not adversely affect
the exclusion from gross income for federal income tax purposes of interest on the Bonds or if the
City has received a Counsel's Opinion to the effect that compliance with some other requirement set
forth in this Section will satisfy the applicable requirements of the Code and Regulations, in which
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case compliance with such other requirement specified in such Counsel's Opinion shall constitute
compliance with the corresponding requirement specified'in this Section. ,
(b) No Private Use or Payment and No Private Loan_Emancing. The City shall certify,
through an authorized officer, employee or agent that based upon all facts and estimates known or
reasonably expected to be in existence on the date the Bonds are delivered, that the proceeds of the
Bonds will not be used in a manner that would cause the Bonds to be "private activity bonds" within
the meaning of section 141. of the Code and the Regulations promulgated thereunder. Moreover, the
City covenants and agrees that it will make such use of the proceeds of the Bonds including interest
or other investment income derived from Bond proceeds, regulate the use of property financed,
directly or indirectly, with such proceeds, and take such other and further action as may be required
so that the Bonds will not be "private activity bonds" within the meaning of section 141 of the Code
and the Regulations promulgated thereunder.
(c) No Federal Guarantee. The City covenants and agrees not take any action, or
knowingly omit to take any action within its control, that, if taken or omitted, respectively, would
cause the Bonds to be "federally guaranteed" within the meaning of section 149(b) of the Code and
the applicable Regulations thereunder, except as permitted by section 149(b)(3) of the Code and such
Regulations.
(d) No Hedge Bonds. The City covenants and agrees that it has not and will not take any
action, and has not knowingly omitted and will not knowingly omit to take any action, within its
control, that, if taken or omitted, respectively, would cause the Bonds to be "hedge bonds" within the
meaning of section 149(8) of the Code and the applicable Regulations thereunder.
(e) No Arbitrage. The City shall certify, through an authorized officer, employee or agent
that based upon all facts and estimates known or reasonably expected to be in existence on the date
the Bonds are delivered, the City will reasonably expect that the proceeds of the Bonds will not be
used in a manner that would cause the Bonds to be "arbitrage bonds" within the meaning of section
148(a) of the Code and the applicable Regulations promulgated thereunder. Moreover, the City
covenants and agrees that it will make such use of the proceeds of the Bonds including interest or
other investment income derived frorn Bond proceeds, regulate investments of proceeds of the
Bonds, and take such other and further action as may be required so that the Bonds will not be
"arbitrage bonds" within the meaning of section 148(a) of the Code and the applicable Regulations
promulgated thereunder.
(f) Arbitrage Rebate. If the City does not qualify for an exception to the requirements of
section 148(f) of the Code relating to the required rebate to the United States, the City will take all
necessary steps to comply with the requirement that certain amounts earned by the City on the
investment of the "gross proceeds" of the Bonds (within the meaning of section 148(f)(6)(B) of the
Code), be rebated to the federal government. Specifically, the City will (i) maintain records
regarding the investment of the gross proceeds of the Bonds as may be required to calculate the
amount earned on the investment of the gross proceeds of the Bonds separately from records of
amounts on deposit in the funds and accounts of the City allocable to other bond issues of the City or
moneys which do not represent gross proceeds of any bonds of the City, (ii) calculate at such times
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as are required by applicable Regulations, the amount earned from the investment of the gross
proceeds of the Bonds which is required to be rebated to the federal government, and (iii) pay, not
less often than every fifth anniversary date of the delivery of the Bonds or on such other dates as may
be permitted under applicable Regulations, all amounts required to be rebated to the federal
government. Further, the City will not indirectly pay any amount otherwise payable to the federal
government pursuant to the foregoing requirements to any person other than the federal government
by entering into any investment arrangement with respect to the gross proceeds of the Bonds that
might result in a reduction in the amount required to be paid to the federal government because such
arrangement results in a smaller profit or a larger loss than would have resulted if the arrangement
had been at arm's length and had the yield on the issue not been relevant to either party.
(g) Information Reportin -. The City covenants and agrees to file or cause to be filed with
the Secretary of the Treasury, not later than the 15th day of the second calendar month after the close
of the calendar quarter in which the Bonds are issued, an information statement concerning the
Bonds, all under and in accordance with section 149(e) of the Code and the applicable Regulations
promulgated thereunder.
(h) Continuing Obligation. Notwithstanding any other provision of this Ordinance, the
City's obligations under the covenants and provisions of this Section shall survive the defeasance and
discharge of the Bonds.
Section 24, Use of Proceeds. Proceeds from the sale of the Bonds shall, promptly upon
receipt by the City, be applied as follows:
(a) Accrued interest and any premium on the Bonds shall be deposited
into the Debt Service Fund.
(b) The remaining proceeds of the Bonds shall be used for the purposes
described in Section 2 of this Ordinance and for paying the costs of
issuance of the Bonds. After accomplishing the purposes described in
Section 2, any remaining bond proceeds, including earnings on
investment of such proceeds, shall be transferred to the Debt Service
Fund.
Section 25. Official Statement. The City ratifies and confirms its prior approval of the
form and content of the Preliminary Official Statement prepared in the initial offering and sale of the
Bonds and hereby authorizes the preparation of a final Official Statement reflecting the terms of the
Underwriter's bid and other relevant information. The use of such Official Statement in the
reoffering of the Bonds by the Underwriter is hereby approved and authorized. The proper officials
of the City are hereby authorized to execute and deliver a certificate pertaining to such Official
Statement as prescribed therein, dated as of the date of payment for and delivery of the.Bonds.
Section 26. Continuing Disclosure Undertakin.Q. (a) Annual Reports. The City shall
provide annually to each NRMSIR and the SID, within six months after the end of each fiscal year,
financial information and operating data with respect to the City of the general type included in the
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final Official Statement authorized by Section 25 of this Ordinance under Tables numbered 1
through 7 and 9 through 20, and in Appendix B. The information to be provided will include
audited financial statements, if the City commissions an audit and it is completed by the required
time. If audited financial statements are not available by the required time, the City will provide
unaudited financial statements at the required.time and audited financial statements when and if they
become available. Any financial statements so to be provided shall be prepared in accordance with
the accounting principles described in Appendix B to the Official Statement, or such other
accounting principles as the City may be required to employ from time to time pursuant to State law
or regulation.
If the City changes its fiscal year, it will notify each NRMSIR and the SID 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
(including an official statement or other offering document, if it is available from the MSRB) that
theretofore has been provided to each NRMSIR and the SID or filed with the SEC.
(b) Material Event Notices. The City shall notify the SID and either each NRMSIR or the
MSRB, in a timely manner, of any of the following events with respect to the Bonds, if such event is
material within the meaning of the federal securities laws:
A. Principal and interest payment delinquencies;
B. Non - payment related defaults;
C. Unscheduled draws on debt service reserves reflecting financial
difficulties;
D. Unscheduled draws on credit enhancements reflecting financial
difficulties;
E. Substitution of credit or liquidity providers, or their failure to
perform;
F. Adverse tax opinions or events affecting the tax - exempt status of the
Bonds;
G. Modifications to rights of holders of the Bonds;
H. Bond calls;
I. Defeasances;
J. Release, substitution, or sale of property securing repayment of the
Bonds; and
K. Rating changes.
The City shall notify the SID and either each NRMSIR or the MSRB, in a timely manner, of
any failure by the City to provide financial information or operating data in accordance with Section
26(a) of this Ordinance by the time required by such Section.
0 (c) Limitations, Disclaimers, and Amendments. The City shall be obligated to observe
M
and perform the covenants specified in this Section for so long as, but only for so long as, 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 notice of any deposit made in accordance,with Texas law that causes
Bonds no longer to be outstanding.
r" t
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
comprise 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.
The provisions of this Section may be amended by the City from time to time to adopt to
changed circumstances that arise from a change in legal requirements, change in law, or change in
the identity, nature, status or type of operations of the City, but only if (1) the agreement, as
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 of the outstanding Bonds consent to such
amendment, or (b) a person unaffiliated with the City (such as nationally recognized bond counsel),
determines that the amendment will not materially impair the interests of the holders and beneficial
owners of the Bonds. The City may also amend or repeal the provisions of this continuing disclosure
agreement if the SEC amends or repeals the applicable provisions of the Rule or a court of final
jurisdiction enters judgment hat such provisions of the Rule are invalid, but only if and to the extent
that the provisions of this sentence would not prevent an underwriter form lawfully purchasing or
selling Bonds in the primary offering of the Bonds. If any such amendment is made, the City will
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include in its next annual update an explanation in narrative form of the reasons for the change and
its impact on the type of operating data or financial information being provided.
Section 27. Registrar. The form of agreement setting forth the duties of the Registrar is
hereby approved, and the appropriate officials of the City are hereby authorized to execute such
agreement for and on behalf of the City.
Section 28. Further Proceedings. The Mayor, the Mayor Pro Tem, City Clerk and other
appropriate officials of the City are hereby authorized and directed to do any and all things necessary
and/or convenient to carry out the terms and purposes of this Ordinance.
Section 29. Partial Invalidity. If any Section, paragraph, clause or provision of this
Ordinance shall for any reason be held to be invalid or unenforceable, the invalidity or
unenforceability of such Section, paragraph, clause or provision shall not affect any of the remaining
provisions of this Ordinance.
Section 30. Open Meeting. The meeting at which this Ordinance was adopted was open to
the public, and public notice of the time, place and purpose of said meeting, was given, all as
required by the Texas Open Meetings Act.
Section 31: This ordinance shall take effect immediately from and after its passage by the
City Council of the City of Baytown.
INTRODUCED, READ and PASSED by the affirmative vote of the City Council of the City
of Baytown this the 13`h day of February, 2003,
ATTEST:
i f W SMITII, City Clerk
APPROVED AS TO FORM:
ACIO RAWREZ, SW., City Attorney
F:Ueanene\My Documents \Council \02 -03\ February\ GeneralObligationBondsSeries2003 .DOC
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