HomeMy WebLinkAboutORD 15-008ORDINANCE NO.15-008
ORDINANCE AUTHORIZING THE ISSUANCE OF THE CITY OF
BEAUMONT, TEXAS, GENERAL OBLIGATION REFUNDING
BONDS, SERIES 2015A IN ONE OR MORE SERIES OR SUBSERIES
AS MAY BE FURTHER DESIGNATED; AUTHORIZING THE
MAYOR OR THE CITY MANAGER AND THE CITY CHIEF
FINANCIAL OFFICER TO APPROVE THE AMOUNTS, INTEREST
RATES, PRICES, AND TERMS THEREOF AND CERTAIN OTHER
MATTERS RELATING THERETO; PROVIDING FOR THE
PAYMENT THEREOF; MAKING OTHER PROVISIONS
REGARDING SUCH BONDS INCLUDING AUTHORIZING THE
PREPARATION AND DISTRIBUTION OF ONE OR MORE
PRELIMINARY OFFICIAL STATEMENTS AND AUTHORIZING
THE PREPARATION AND DISTRIBUTION OF ONE OR MORE
OFFICIAL STATEMENTS AND MATTERS INCIDENT THERETO;
AWARDING THE SALE OF THE BONDS; AUTHORIZING THE
EXECUTION AND DELIVERY OF ONE OR MORE BOND
PURCHASE AGREEMENTS; AUTHORIZING THE DEFEASANCE,
FINAL PAYMENT, AND DISCHARGE OF CERTAIN
OUTSTANDING OBLIGATIONS; AUTHORIZING THE EXECUTION
AND DELIVERY OF ONE OR MORE ESCROW AGREEMENTS;
AUTHORIZING THE PURCHASE OF AND SUBSCRIPTION FOR
CERTAIN ESCROWED SECURITIES; AUTHORIZING ESCROW
VERIFICATION AND ENGAGEMENT OF AN ESCROW AGENT;
AUTHORIZING BOND INSURANCE; AUTHORIZING THE
EXECUTION AND DELIVERY OF A PAYING AGENT/REGISTRAR
AGREEMENT AND OTHER RELATED DOCUMENTS; AND
MAKING OTHER PROVISIONS REGARDING SUCH BONDS.
WHEREAS, the City Council (the "Council") of the City has previously issued, sold, and
delivered, and there is currently outstanding, obligations 'identified in Schedule I, attached hereto
(the "Refunded Obligations"); and,
WHEREAS, pursuant to the provisions of Texas Government Code, Chapter 1207, as
amended, the City is authorized to issue refunding bonds and deposit the proceeds of sale directly
with any place of payment for the Refunded Obligations, or other authorized depository, and such
deposit, when made in accordance with said statute, shall constitute the making of firm banking
and financial arrangements for the discharge and final payment of the Refunded Obligations; and,
WHEREAS, the City shall by this Ordinance, in accordance with the provisions of Chapter
1207, Texas Government Code, as amended, delegate to a Pricing Officer (hereinafter designated)
the authority to determine the principal amount of Bonds to be issued and negotiate the terms of
sale thereof and to select the specific maturities, in whole or in part, of the Refunded Obligations
to be refunded; and,
WHEREAS, the Council hereby finds and determines that it is a public purpose and in the
best interests of the City to (1) issue the Bonds with such terms to be included in a pricing
certificate (the "Officer's Pricing Certificate") to be executed by the Pricing Officer, and (2)
refund the Refunded Obligations in order to achieve a net present value debt service savings and
that such benefit is sufficient consideration for the refunding of the Refunded Obligations, with
such savings, among other information and terms to be included in the Officer's Pricing
Certificate, all in accordance with the provisions of Chapter 1207, Texas Government Code, as
amended; and,
WHEREAS, the Council hereby finds that it may purchase a credit agreement in the form
of a municipal bond insurance policy or policies with respect to the Bonds if it deems such
purchase is cost effective; and,
WHEREAS, the City hereby finds and determines that the manner in which the refunding
is being executed does not make it practicable to make the determination described by Section
1207.008(a)(2) of Chapter 1207, Texas Government Code, as amended; and,
WHEREAS, the City is a home -rule municipality that: (i) adopted its charter under
Section 5, Article XI, Texas Constitution; (ii) has a population of more than 50,000 and (iii) has
outstanding long-term indebtedness that is rated by a nationally recognized rating agency for
municipal securities in one of the four highest rating categories for a long-term obligation;
NOW, THEREFORE, BE IT ORDAINED
BY THE CITY COUNCIL OF THE CITY OF BEAUMONT:
1. Findings and Determinations. It is hereby found and determined that the matters
and facts contained in the preamble to this Ordinance are hereby found to be true and correct.
2. Definitions. Throughout this ordinance the following terms and expressions as
used herein shall have the meanings set forth below:
The term "Blanket Issuer Letter of Representations" means the Blanket Issuer Letter of
Representations between the City and DTC.
The term "Bond Insurer" shall mean, if any, a third parry financial institution that provides
a credit agreement in the form of a municipal bond insurance policy, as determined in the
Officer's Pricing Certificate.
The term "Bond Register" shall mean 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.
The terms "Bonds" shall mean THE CITY OF BEAUMONT, TEXAS, GENERAL
OBLIGATION REFUNDING BONDS, SERIES 2015A.
The term "Business Day" shall mean any day which is not a Saturday, Sunday, a day on
which banking institutions in the city where the principal corporate trust office of the Paying
Agent/Registrar or Bond Insurer, if any, is located, are authorized or required by law or executive
order to close, or a legal holiday.
The term "City" shall mean The City of Beaumont, Texas.
The term "Closing Date" means the date of the initial delivery of and payment for the
Bonds.
The term "Code" means the Internal Revenue Code of 1986, as heretofore and hereafter
amended.
The term "Comptroller" means the Comptroller of Public Accounts of the State of Texas.
The term "DTC" means The Depository Trust Company of New York, New York, or any successor
securities depository.
The term "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.
The term "Insured Bonds" shall mean the Bonds during the time period in which the
payment of principal and interest in connection with such bonds is guaranteed by the Insurer.
The term "Interest Payment Date", when used in connection with any Bond, shall mean
September 1, 2015 and each March 1 and September 1 thereafter until maturity or earlier
redemption of such Bond.
The term "Issuer" shall mean the City.
The term "MSRB" shall mean the Municipal Securities Rulemaking Board.
The term "Officer's Pricing Certificate" shall mean a certificate or certificates to be signed
by the Mayor, the City Manager or the Chief Financial Officer of the City pursuant to Section 5
hereof and delivered to the City Clerk, in substantially the forms attached hereto as Exhibit D.
The term "Ordinance" as used herein and in the Bonds shall mean this ordinance
authorizing the Bonds and all amendments and supplements hereto.
The term "Outstanding" shall mean, in connection with the Bonds, any Bonds that remain
outstanding until maturity, refunding or defeasance.
The term "Owner" shall mean any person who shall be the registered owner of any Bonds.
The term "Paying Agent" for the Bonds shall mean the Registrar.
The term "Pricing Officer" shall mean the Mayor, City Manager, or Chief Financial
Officer of the City.
The term "Record Date" shall mean, for any Interest Payment Date, the fifteenth (15th)
calendar day of the month next preceding each Interest Payment Date.
The term "Registrar" shall mean The Bank of New York Mellon Trust Company, N.A.,
Dallas, Texas, and its successors in that capacity.
The term "Report" shall mean the verification report provided by Grant Thornton LLP,
certified public accountants, with respect to the Bonds and the adequacy of the amounts deposited
pursuant to the Escrow Agreement to pay, when due, the principal of, and interest on the
Refunded Obligations and certain other calculations.
The term "Rule" shall mean SEC Rule 15c-12, as amended from time to time.
The term "SEC" shall mean the United States Securities and Exchange Commission.
The term "Underwriter" shall mean, collectively, , as senior
underwriter, as co -senior underwriter, , and as co -managers.
3. Authorization. The Series 2015A Bonds shall be issued in fully registered form in
the total authorized aggregate principal amount not to exceed FORTY-FIVE MILLION AND
NO/100 DOLLARS ($45,000,000) for the purpose of providing funds to (i) discharge and make
final payment of certain obligations of the City, as set forth in Schedule I, attached hereto (the
"Refunded Obligations"), and (ii) paying costs of issuance of the Bonds and refunding the
Refunded Obligations.
4. Designation, Date, and Interest Payment Dates. The Series 2015A Bonds shall be
designated as "THE CITY OF BEAUMONT, TEXAS, GENERAL OBLIGATION REFUNDING
BONDS, SERIES 2015A." The Bonds shall be dated, mature, bear interest from the dates and at
the rates per annum, and be payable on the dates and in the principal amounts as set forth in the
Officer's Pricing Certificate.
5. Sale of Bonds. As authorized by Chapters 1207, Texas Government Code, as
amended, the Mayor, the City Manager or the Chief Financial Officer of the City are hereby
authorized to act on behalf of the City in selling and delivering the Bonds and carrying out the
other procedures specified in this Ordinance, including any additional designation or title by
which the Bonds shall be known, the number of subseries of Bonds to be issued and the principal
amount of each subseries, the price at which each series of the Bonds will be sold, the date or
dates (which may be different dates for each series of the Bonds) on which the Bonds shall be
sold, the form in which the Bonds shall be issued whether as current interest bonds, as compound
interest bonds, or as a combination of current interest bonds and compound interest bonds, any
additional designation or title by which the Bonds shall be known, the year or years in which each
series of the Bonds will mature, the principal amount to mature in each of such years, the
aggregate principal amount of each series of the Bonds, the.rate of interest to be borne by each
such maturity, the first interest payment date or compounding date, as the case may be, the dates,
prices, and terms, if any, upon and at which each series of the Bonds shall be subject to
redemption prior to maturity at the option of the City, as well as any mandatory sinking fund
redemption provisions, or make -whole provisions, and such officers are also hereby authorized to
act on behalf of the City in approving all other matters relating to the issuance, sale and delivery
of the Bonds, including the refunding of the Refunded Obligations and the purchase of a bond
insurance policy or policies for all or any portion of the Bonds, all of which shall be specified in
one or more bond purchase agreements (the "Bond Purchase Agreement") for the Bonds
substantially in the form attached hereto as Exhibit C, in accordance with the terms of the
Officer's Pricing Certificate for the Bonds and this Ordinance, provided that:
(a) the price to be paid for each series of the Bonds shall not be less than 90% of the
aggregate original principal amount of the current interest bonds plus accrued interest, if any,
thereon from their date to their delivery,
(b) none of the Bonds shall bear interest at a rate greater than 6% per annum or in
excess of the maximum rate allowed by Chapter 1204, Texas Government Code,
(c) the aggregate principal amount of each subseries of the Bonds shall not exceed the
maximum amount authorized in Section 3, and the sum of the principal amount of each series,
plus net premium generated, plus any available funds of the City, if any, shall equal an amount
sufficient to provide for the redemption of the Refunded Obligations as identified on the Officer's
Pricing Certificate, to pay costs of issuance of the Bonds,
(d) each series of the Bonds to be issued, prior to delivery, must have been rated by a
nationally recognized rating agency for municipal securities in one of the four highest rating
categories for long-term obligations, and
(e) the refunding of the Refunded Obligations shall produce a net present value debt
service savings of at least 2.5%, as shown by a calculation prepared by the Municipal Advisors
(defined herein), and attached to the Officer's Pricing Certificate.
Any fmding by the Mayor, City Manager or the Chief Financial Officer relating to the sale and delivery of
the Bonds and the purchase of bond insurance shall have the same force and effect as a finding or determination made
by the City Council.
6. Bond Numbers and Denominations. Each series of Bonds shall be numbered from
R-1 and upward (except the Initial Bond, which shall each be numbered T-1), and may be transferred
and exchanged as set out in this Ordinance. Such Bonds shall mature on September 1 in each of the
years and in the amounts set forth in the Initial Bond. The Bonds delivered in 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 Bonds or Bonds in lieu of which they are delivered.
7. Execution of Bonds; Seal. The Bonds shall be signed by the Mayor or Mayor Pro
Tem and countersigned by the City Clerk or Deputy 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. 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 shall nevertheless be valid
and sufficient for all purposes as if such officer had remained in such office.
8. Approval by Attorney General; Registration by Comptroller. The Bonds to be
initially issued shall be delivered to the Attorney General of Texas for approval and shall be
registered by the Comptroller of Public Accounts of the State of Texas. The manually executed
registration Bond of the Comptroller of Public Accounts substantially in the form provided in
Officer's Pricing Certificate shall be attached or affixed to the Bonds to be initially issued.
9. Authentication. Except for the Bonds to be initially issued, which need not be
authenticated by the Registrar, only such Bonds which bear thereon a certificate of authentication,
substantially in the form provided in Section 19 of this Ordinance, manually executed by an
authorized representative of the Registrar, shall be entitled to the benefits of this Ordinance or
shall be valid or obligatory for any purpose. Such duly executed certificate of authentication shall
be conclusive evidence that the Bonds so authenticated were delivered by the Registrar hereunder.
10. Payment of Principal and Interest. The Registrar is hereby appointed as the paying
agent for the Bonds. The principal of and premium, if any, on the Bonds shall be payable, without
exchange or collection charges, in any coin or currency of the United States of America which, on
the date of payment, is legal tender for the payment of debts due the United States of America,
upon their presentation and surrender as they respectively become due and payable, whether at
maturity or by prior redemption, at the principal corporate trust office of the Registrar. The
interest on each Bond shall be payable by check on the Interest Payment Date, mailed by the
Registrar on or before each Interest Payment Date to the Owner of record as of the Record Date,
to the address of such Owner as shown on the Bond Register. Any accrued interest payable at
maturity on a Bond shall be paid upon presentation and surrender of such Bond at the principal
corporate trust office of the Registrar.
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, and payment on such date shall have the same force and
effect as if made on the original date such payment was due.
11. Successor Registrars. The City covenants that at all times while any Bonds are
outstanding it will provide a legally qualified bank, trust company, financial institution or other
agency to act as Registrar for the Bonds. The City reserves the right to change the Registrar for
the Bonds 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 interest payment date on
the Bonds. Promptly upon the appointment of any successor Registrar, the previous Registrar
shall deliver the Bond Register or copies thereof to the new Registrar, and the new Registrar shall
notify each Owner, by United States mail, first class postage prepaid, of such change and of the
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.
12. 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.
13. Ownership, Unclaimed Principal and Interest. The City, the Registrar and any
other person may treat the person in whose name any Bond is registered as the absolute owner of
such Bond for the purpose of making and receiving payment of principal of and premium, if any,
or interest on such Bond, and for all other purposes, whether or not such Bond is overdue, and
neither the City nor the Registrar shall be bound by any notice or knowledge to the contrary. All
payments made to the person deemed to be the owner of any Bond in accordance with this Section
13 shall be valid and effectual and shall discharge the liability of the City and the Registrar upon
such Bond to the extent of the sums paid.
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 Title 6
of the Texas Property Code, as amended.
14. Registration, Transfer, and Exchange. So long as any Bonds remain outstanding,
the Registrar shall keep the Bond Register, at its principal corporate trust office and, subject to
such reasonable regulations as it may prescribe, the Registrar shall provide for the registration and
transfer of Bonds in accordance with the terms of this Ordinance. If the Registrar does not
maintain its principal offices in the State of Texas, the City agrees to keep a Bond Register at its
offices which is identical to the Bond Register maintained by the Registrar and the Registrar will
notify the City as to any changes in the Bond Register within 1 business day.
Each Bond shall be transferable only upon the presentation and surrender thereof at the
principal corporate trust office of the Registrar, duly endorsed for transfer, or accompanied by an
assignment duly executed by the registered Owner or his authorized representative in form
satisfactory to the Registrar. Upon due presentation of any Bond in proper form for transfer, the
Registrar shall authenticate and deliver in exchange therefor, within three (3) business days after
such presentation, a new Bond or Bonds, registered in the name of the transferee or transferees, in
authorized denominations and of the same type, maturity and aggregate principal amount and
bearing interest at the same rate as the Bond or Bonds so presented.
All Bonds shall be exchangeable upon presentation and surrender thereof at the principal
corporate trust office of the Registrar for a Bond or Bonds of the same type, 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 14. Each Bond delivered in accordance with this Section 14 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 Owner of any Bond to pay a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection with the transfer
or exchange of such Bond. Any fee or charge of the Registrar for such transfer or exchange shall
be paid by the City.
Neither the City nor the Registrar shall be required to transfer or exchange any Bond called
for redemption, in whole or in part, within forty-five (45) days of the date fixed for redemption;
provided, however, such limitation on transfer shall not be applicable to an exchange by the Owner
of the unredeemed balance of a Bond called for redemption in part.
15. 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 execute 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 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 14 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.
16. 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 Bonds of
destruction of such Bonds.
17. Book -Entry System. (a) Notwithstanding any other provision hereof, upon initial
issuance of the Bonds but at the sole election of the Underwriter, the ownership of the Bonds shall be
registered in the name of Cede & Co., as nominee of DTC, and except as otherwise provided in this
Section, all of the Outstanding Bonds shall be registered in the name of Cede & Co., as nominee of
DTC. The definitive Bonds shall be initially issued in the form of a single separate Bond for each of
the maturities thereof. If the Underwriter shall elect to invoke the provisions of this Section, then the
following provisions shall take effect with respect to the Bonds.
(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 a DTC Participant holds an interest in the Bonds. Without
limiting the immediately preceding sentence, the City and the Registrar shall have no
responsibility or obligation with respect to (i) 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 of a Bond, 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 of a Bond, as shown in 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, premium,
if any, and interest on the Bonds, for the purpose of all matters with respect to such Bond, for the
purpose of registering transfers 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 payment of principal
of, 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 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., the word "Cede & Co." in this Ordinance shall refer to such new nominee
of DTC.
(c) In the event that the City in its sole discretion determines that the beneficial owners of
the Bonds be able to obtain Bonds, or in the event DTC discontinues the services described herein,
the City shall (i) appoint a successor securities depository, qualified to act as such under Section
17(a) of the Securities and Exchange Act of 1934, as amended, and 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 their DTC , as
identified by DTC. In such event, the Bonds shall no 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.
(d) The execution and delivery of the Blanket Letter of Representations is hereby ratified
and approved and the. Mayor is hereby authorized and directed to execute a new Blanket Letter of
Representations, if required, with such changes as may be approved by the Mayor or City
Manager of the City.
(e) 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.
18. Redemption and Defeasance.
(a) Optional Redemption. The Bonds shall be subject to redemption prior to the stated
maturity, at the option of the City at such times, in such amounts, in such manner and at such
redemption prices as may be designated and provided for in the Officer's Pricing Certificate.
Bonds 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 A 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 14 hereof, shall authenticate and deliver in exchange
therefor a Bond(s) of like maturity and interest rate in an aggregate principal amount equal to the
unredeemed portion of the Bond(s) so surrendered.
The City, at least 45 days before the redemption date, unless a shorter period shall be
satisfactory to the Paying Agent/Registrar, shall notify the Paying Agent/Registrar of such
redemption date and of the principal amount of Bonds to be redeemed.
Not less than thirty (30) days prior to a redemption date for the Bonds, the City shall cause a
notice of redemption to be sent by United States mail, first class, postage prepaid, to each Owner of
each Bond to be redeemed in whole or in part, at the address of the Owner appearing on the Register
at the close of business on the Business Day next preceding the date of the mailing of such notice.
Such notice shall state the redemption date, the redemption price, the place at which Bonds are to be
surrendered for payment and, if less than all the Bonds are to be redeemed, the numbers of the Bonds
or portions thereof to be redeemed. Any notice of redemption so mailed 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. When Bonds have been called for redemption in
whole or in part and due provision made to redeem the same as herein provided, the Bonds or
portions thereof so redeemed shall no longer be regarded as outstanding except for the purpose of
being paid 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 Series 2015A Bond or
portion thereof called for redemption shall terminate on the date fixed for redemption.
With respect to any optional redemption of the Bonds, unless moneys sufficient to pay the
principal of and premium, if any, and interest on the Bonds to be redeemed shall have been received
by the Paying Agent/Registrar prior to the giving of such notice of redemption, such notice may state
that said redemption is conditional upon the receipt of such moneys by the Paying Agent/Registrar on
or prior to the date fixed for such redemption, or upon the satisfaction of any prerequisites set forth in
such notice of redemption; and, if sufficient moneys are not received, such notice shall be of no force
and effect, the City shall not redeem such Bonds and the Paying Agent/Registrar shall give notice, in
the manner in which the notice of redemption was given, to the effect that the Bonds have not been
redeemed.
(b) The City may defease the provisions of this Ordinance or any ordinance applicable to
any Bonds being defeased and discharge its obligation to the Owners of any or all of the Bonds, or
any or all Bonds to pay principal, interest and redemption premium, if any, thereon in any manner
permitted by law, including by depositing with the Paying Agent/Registrar, or if authorized by Texas
law, with any national or state bank having trust powers and having combined capital and surplus of
at least $50 million, or with the State Treasurer of the State of Texas either: (a) cash in an amount
equal to the principal amount and redemption premium, if any, of such bonds being defeased plus
interest thereon to the date of maturity or redemption; or (b) pursuant to an escrow or trust agreement,
cash and/or direct bonds of, or bonds the principal of and interest on which are guaranteed by or,
secured by the pledge of direct bonds of the United States of America, in principal amounts and
maturities and bearing interest at rates sufficient to provide for the timely payment of the principal
amount and redemption premium, if any, of such bonds being defeased plus interest thereon to the
date of maturity or redemption; provided, however, that if any of such bonds being defeased are to be
redeemed prior to their respective dates of maturity, provision shall have been made for giving notice
of redemption as provided in this Ordinance or ordinance applicable to the Bonds being defeased.
Upon such deposit, such bonds being defeased shall no longer be regarded to be outstanding or
unpaid. Any surplus amounts not required to accomplish such defeasance shall be returned to the
City.
19. Form. The Form of Bond as set forth in Exhibit A to the Officer's Pricing Certificate
is hereby approved. The form of the Bonds, including the form of the Registrar's Authentication
Certificate, the form of Assignment, and the form of Registration Bond of the Comptroller of Public
Accounts of the State of Texas which shall be attached or affixed to the Bonds initially issued shall
be, respectively, substantially as set forth in Exhibit A to the Officer's Pricing Certificate, with such
additions, deletions and variations as may be necessary or desirable and not prohibited by this
Ordinance.
20. Legal Opinion; CUSIP Numbers. The approving opinion of Bracewell & Giuliani
LLP, Houston, Texas, Bond Counsel, and CUSIP Numbers may be printed on the Bonds, but
errors or omissions in the printing of such opinion or such numbers shall have no effect on the
validity of the Bonds.
21. Pledge and Source of Payment. IT IS ORDERED AND DIRECTED that this
Ordinance pledging ad valorem tax revenue of the City for the payment of the Bonds to the extent
provided herein be filed and recorded in the records of the City as necessary to cause the pledge to
be valid under Section 1201.44 of the Government Code of Texas. At any time while any of the
Bonds are outstanding, it is determined by the City or demanded by the holder of any Bonds that
further action by the City is required to make the pledge valid or maintain the validity of the
pledge, the City covenants and hereby directs the officers of the City to make such filings,
including but not limited to appropriate filings under Chapter 9 of the Business and Commerce
Code of Texas as are necessary to make the pledge valid or continue its validity.
22. Interest and Sinking Fund; Levy, Assessment and Collection of Taxes. There is
hereby established a separate fund of the City to be known as the "Series 2015A General Obligation
Refunding Bonds Interest and Sinking 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 Interest and Sinking
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 other City taxes are assessed, levied and collected, in each
year, beginning with the current year, a continuing direct annual ad valorem tax upon all taxable
property in said City sufficient to pay the current interest on said Bonds as the same becomes due,
and to create and provide a sinking fund of not less than two percent (2%) of the original principal
amount of the Bonds or of not less than the amount required to pay each installment of the principal
of said Bonds as the same matures, whichever is greater, full allowance being made for
delinquencies and costs of collection, and said taxes when collected shall be applied to the payment
of the interest on and principal of said Bonds and to no other purpose. In addition, interest accrued
from the date of the Bonds until their delivery is to be deposited in such fund. There is hereby
appropriated from current funds on hand, which are certified to be on hand and available for such
purpose, an amount sufficient to pay debt service coming due on the Bonds on September 1, 2015,
and such amount shall not be used for any other purpose. A tax rate has not been determined for
2015, but the City certifies that such rate, when determined, will take into account the Bonds
being issued.
23. Covenants and Provisions Relating to the Bonds.
(a) Punctual Payment of Bonds. The City will punctually pay or cause to be paid the
interest on and principal of all Bonds according to the terms thereof and will faithfully do and
perform, and at all times fully observe, any and all covenants, undertakings, stipulations and
provisions contained in this Ordinance and in any ordinance authorizing the issuance of
Additional Bonds.
(b) Accounts, Records and Audits. So long as any Bonds remain outstanding, the
City -covenants and agrees that it will maintain a proper and complete system of records and
accounts pertaining to the operation of the System in which full, true and proper entries will be
made of all dealings, transactions, business and affairs which in any way affect or pertain to the
System or the Gross Revenues or the Net Revenues thereof. The City shall after the close of
each of its Fiscal Years cause an audit report of such records and accounts to be prepared by an
independent certified public accountant or independent firm of certified public accountants.
Each year promptly after such audit report is prepared, the City shall furnish a copy thereof
without cost to the Municipal Advisory Council of Texas and any holders of Bonds who shall
request same. All expenses incurred in preparing such audits shall be Maintenance and
Operation Expenses.
(c) Legal Holidays. In any case where the date fixed for payment of interest on or
principal of the Bonds or the date fixed for redemption of any Bonds shall be a legal holiday or a
day on which a paying agent for the Bonds is authorized by law to close, then payment of
interest or principal by such paying agent need not be made on such date but may be made on the
next succeeding business day with the same force and effect as if made on the date fixed for such
payment and no interest shall accrue for the period from such date to the date of actual payment.
(d) Unavailability of Authorized Publication. If, because of the temporary or
permanent suspension of any newspaper, journal or other publication, or, for any reason,
publication of notice cannot be made meeting any requirements herein established, any notice
required to be published by the provisions of this Ordinance shall be given in such other manner
and at such time or times as in the judgment of the City shall most effectively approximate such
required publication and the giving of such notice in such manner shall for all purposes of this
Ordinance be deemed to be in compliance with the requirements for publication thereof.
24. Events of Default. Each of the following occurrences or events for the purpose
of this Ordinance is hereby declared to be an Event of Default:
(a) the failure to make payment of the principal of or interest on any of the Bonds
when the same becomes due and payable; or
(b) default in the performance or observance of any other covenant, agreement or
obligation of the City, which default materially and adversely affects the rights of the Owners,
including but not limited to, their prospect or ability to be repaid in accordance with this
Ordinance, and the continuation thereof for a period of sixty (60) days after notice of such
default is given by any Owner to the City.
25. Remedies for Default. Upon the happening of any Event of Default, then any
Owner or an authorized representative thereof, including but not limited to, a trustee or trustees
therefor, may proceed against the City for the purpose of protecting and enforcing the rights of
the Owners under this Ordinance, by mandamus or other suit, action or special proceeding in
equity or at law, in any court of competent jurisdiction, for any relief permitted by law, including
the specific performance of any covenant or agreement contained herein, or thereby to enjoin any
act or thing that may be unlawful or in violation of any right of the Owners hereunder or any
combination of such remedies.
It is provided that all such proceedings shall be instituted and maintained for the equal
benefit of all Owners of Bonds then outstanding.
26. Remedies Not Exclusive. No remedy herein conferred or reserved is intended to
be exclusive of any other available remedy or remedies, but each and every such remedy shall be
cumulative and shall be in addition to every other remedy given hereunder or under the Bonds or
now or hereafter existing at law or in equity; provided, however, that notwithstanding any other
provision of this Ordinance, the right to accelerate the debt evidenced by the Bonds shall not be
available as a remedy under this Ordinance.
The exercise of any remedy herein conferred or reserved shall not be deemed a waiver of
any other available remedy.
27. Further Proceedings. After the Bonds to be initially issued shall have been
executed, it shall be the duty of the Mayor 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 of the State of Texas, for examination and approval. After the Bonds to be
initially issued shall have been approved by the Attorney General, they shall be delivered to the
Comptroller of Public Accounts of the State of Texas for registration. Upon registration of the
Bonds to be initially issued, the Comptroller of Public Accounts (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.
28. Tax Exemption.
(a) The City intends that the interest on the Bonds shall be excludable from gross
income for federal income tax purposes pursuant to Sections 103 and 141 through 150 of the
Code, and the applicable Treasury Regulations promulgated thereunder (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 (i) 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
or (ii) result in the violation or failure to satisfy any provision of Section 103 and 141 through
150 of the Code and the applicable Regulations. In particular, the City covenants and agrees to
comply with each requirement of this Section 25; provided, however, that the City shall not be
required to comply with any particular requirement of this Section 25 if the City has received an
opinion of nationally recognized bond counsel (a "Counsel's Opinion") that (i) such
noncompliance will not adversely affect the exclusion from gross income for federal income tax
purposes of interest on the Bonds or (ii) compliance with some other requirement set forth in this
Section 25 will satisfy the applicable requirements of the Code and the Regulations, in which
case compliance with such other requirement specified in such Counsel's Opinion shall
constitute compliance with the corresponding requirement specified in this Section 25.
(b) No Private Use or Payment and No Private Loan Financing. 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 Series 2015A 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. Moreover, the City shall certify,
through an authorized officer, employee or agent that based upon all facts and circumstances
known or reasonably expected to be in existence on the date the Bonds are delivered, that the
proceeds of the outstanding Bonds have not been and 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.
(c) No Federal Guaranty. 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 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 not to 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 "hedge bonds" within the meaning of section 149(g) of the Code and the
applicable Regulations thereunder. Moreover, the City will certify, through an authorized
officer, employee or agent, 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 Refunded
Obligations have not been used in a manner that would cause the Refunded Obligations or the
Bonds to be "hedge bonds" within the meaning of section 149(g) of the Code and the
Regulations promulgated thereunder.
(e) No -Arbitrage. The City covenants ,and agrees that it will make such use of the
proceeds of the Bonds, including interest or other investment income derived therefrom, regulate
investments of such proceeds and amounts, 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. Moreover, 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 "arbitrage
bonds" within the meaning of Section 148(a) of the Code and 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 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) determine at such times 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 date 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 an 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 Reporting. 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
applicable Regulations promulgated thereunder.
(h) Record Retention. The City will retain all pertinent and material records relating
to the use and expenditure of the proceeds of the Refunded Obligations and the Bonds until three
years after the last Series 2015A Bond is redeemed, or such shorter period as authorized by
subsequent guidance issued by the Department of Treasury, if applicable. All records will be
kept in a manner that ensures their complete access throughout the retention period. For this
purpose, it is acceptable that such records are kept either as hardcopy books and records or in an
electronic storage and retrieval system, provided that such electronic system includes reasonable
controls and quality assurance programs that assure the ability of the City to retrieve and
reproduce such books and records in the event of an examination of the Bonds by the Internal
Revenue Service.
(i) Registration. The Bonds will be issued in registered form.
0) Deliberate Actions. The City will not take a deliberate action (as defined in
section 1.141-2(d)(3) of the Regulations) that causes the Bonds to fail to meet any requirement of
section 141 of the Code after the issue date of the Bonds unless an appropriate remedial action is
permitted by section 1.141-12 of the Regulations and an opinion of Bond Counsel is obtained.
that such remedial action cures any failure to meet the requirements of section 141 of the Code.
` (k) 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 for so long as such matters are relevant to the exclusion
from gross income of interest on the Bonds for federal income tax purposes.
29. Escrow Agreements. The form of the escrow agreement (the "Escrow Agreement")
by and between the City and The Bank of New York Mellon Trust Company, N.A., Dallas, Texas
(the "Escrow Agent"), attached hereto as Exhibit A and incorporated herein by reference as a part of
this Ordinance for all purposes, is hereby approved as to form and content, and such Escrow
Agreement in substantially the form and substance attached hereto, together with such changes or
revisions as may be necessary to accomplish the refunding or benefit the City, is hereby authorized
to be executed by the Mayor or Mayor Pro Tem and City Clerk for and on behalf of the City.
Furthermore, appropriate officials of the City in cooperation with the Escrow Agent are hereby authorized
and directed to make the necessary arrangements for the purchase of the escrowed securities referenced in the
Escrow Agreement, if any, and the delivery thereof to the Escrow Agent on the day of delivery of the Bonds to the
Underwriter for deposit to the credit of the "2015 CITY OF BEAUMONT, TEXAS, GENERAL OBLIGATION
REFUNDING BOND ESCROW FUND" (the "Escrow Fund"); all as contemplated and provided in Texas
Government Code, Chapter 1207, as amended, this Ordinance and the Escrow Agreement.
30. Refunded Obligations. (a) In order to provide for the refunding, discharge and retirement of the
Refunded Obligations, the Refunded Obligations are called for redemption on at the price of par plus
accrued interest to the redemption date, and notice of such redemption shall be given in accordance with the applicable
provisions of the ordinance adopted by the Council, which authorized the issuance of the Refunded Obligations. The
City Clerk is hereby authorized and directed to file a copy of this Ordinance, together with a suggested form of notice of
redemption to be sent to bondholders, with The Bank of New York Mellon Trust Company, N.A., Dallas, Texas, in
accordance with the redemption provisions applicable to the Refunded Obligations.
(b) The redemption of the Refunded Obligations described above being associated
with the refunding of such Refunded Obligations, the approval, authorization and arrangements
herein given and provided for the redemption, of such Refunded Obligations on the redemption
date designated therefor and in the manner provided shall be -irrevocable upon the issuance and
delivery of the Bonds; and the City Clerk is hereby authorized and directed to make all
arrangements necessary to notify the holders of such Refunded Obligations of the City's decision
to redeem such Refunded Obligations on the date and in the manner herein provided and in
accordance with the ordinance authorizing the issuance of the Refunded Obligations and this
Ordinance.
31. Engagement of Professionals. The City Council hereby confirms the
engagement of (i) RBC Capital Markets, LLC, as Municipal Advisor, to the City and (ii)
as the senior underwriter, as co -senior underwriter,
and as co -managers (together, the "Underwriter") in connection
with the issuance and sale of the Bonds.
32. Proceeds of Sale. Proceeds from the sale of the Bonds, together with other funds
of the City, if any, shall, promptly upon receipt by the City, be applied as set forth in the
Officer's Pricing Certificate. Any proceeds remaining after the accomplishment of such
purposes, including interest earnings on the investment of such proceeds, shall be deposited to
the Interest and Sinking Fund.
33. Bond Insurance. In order to obtain the lowest attainable interest rates on the
Bonds, the Mayor, the City Manager or the Chief Financial Officer are authorized to enter into a
credit agreement with one or more Bond Insurers to obtain one or more bond insurance policies
with respect to all or a portion of the Bonds. The Mayor, the City Manager or the Chief
Financial Officer are authorized to execute and the City Secretary is authorized to attest and affix
the City's seal to any documents required in connection with the purchase of any such policy or
policies. The City hereby agrees to the following:
(a) "Insurance Policy" shall be defined as follows: "the insurance policy issued by the Insurer
guaranteeing the scheduled payment of principal of and interest on the Bonds when due".
"Insurer" shall be defined as follows: "Assured Guaranty Municipal Corp., a New York
stock insurance company, or any successor thereto or assignee thereof'.
(b) The prior written consent of the Insurer shall be a condition precedent to the deposit of any
credit instrument provided in lieu of a cash deposit into the Debt Service Reserve Fund, if
any. Notwithstanding anything to the contrary set forth in the Ordinance, amounts on
deposit in the Debt Service Reserve Fund shall be applied solely to the payment of debt
service due on the Bonds.
(c) The Insurer shall be deemed to be the sole holder of the Insured Bonds for the purpose of
exercising any voting right or privilege or giving any consent or direction or taking any
other action that the holders of the Bonds insured by it are entitled to take pursuant to the
section or article of the Ordinance pertaining to (i) defaults and remedies and (ii) the duties
and obligations of the Paying Agent. In furtherance thereof and as a term of the Ordinance
and each Bond, the Paying Agent and each Bondholder appoint the Insurer as their agent
and attorney-in-fact and agree that the Insurer may at any time during the continuation of
any proceeding by or against the Issuer under the United States Bankruptcy Code or any
other applicable bankruptcy, insolvency, receivership, rehabilitation or similar law (an
"Insolvency Proceeding") direct all matters relating to such Insolvency Proceeding,
including without limitation, (A) all matters relating to any claim or enforcement
proceeding in connection with an Insolvency Proceeding (a "Claim"), (B) the direction of
any appeal of any order relating to any Claim, (C) the posting of any surety, supersedeas or
performance bond pending any such appeal, and (D) the right to vote to accept or reject
any plan of adjustment. In addition, the Paying Agent and each Bondholder delegate and
assign to the Insurer, to the fullest extent permitted by law, the rights of the Paying Agent
and each Bondholder in the conduct of any Insolvency Proceeding, including, without
limitation, all rights of any party to an adversary proceeding or action with respect to any
court order issued in connection with any such Insolvency Proceeding. Remedies granted
to the Bondholders shall expressly include mandamus.
(d) The security for the Bonds shall include a pledge of any agreement with any underlying
obligor that is a source of payment for the Bonds and a default under any such agreement
shall constitute an Event of Default under the Ordinance.
(e) If acceleration is permitted under the Ordinance, the maturity of Bonds insured by the
Insurer shall not be accelerated without the consent of the Insurer and in the event the
maturity of the Bonds is accelerated, the Insurer may elect, in its sole discretion, to pay
accelerated principal and interest accrued on such principal to the date of acceleration (to
the extent unpaid by the Issuer) and the Paying Agent shall be required to accept such
amounts. Upon payment of such accelerated principal and interest accrued to the
acceleration date as provided above, the Insurer's obligations under the Insurance Policy
with respect to such Bonds shall be fully discharged.
(f) No grace period for a covenant default shall exceed 30 days or be extended for more than
60 days, without the prior written consent of the Insurer. No grace period shall be
permitted for payment defaults.
(g) The Insurer shall be included as a third party beneficiary to the Ordinance.
(h) Upon the occurrence of an extraordinary optional, special or extraordinary mandatory
redemption in part, the selection of Bonds to be redeemed shall be subject to the approval
of the Insurer. The exercise of any provision of the Ordinance which permits the purchase
of Bonds in lieu of redemption shall require the prior written approval of the Insurer if any
Bond so purchased is not cancelled upon purchase.
(i) Any amendment, supplement, modification to, or waiver of, the Ordinance or any other
transaction document, including any underlying security agreement (each a "Related
Document"), that requires the consent of Bondowners or adversely affects the rights and
interests of the Insurer shall be subject to the prior written consent of the Insurer.
(j) Unless the Insurer otherwise directs, upon the occurrence and continuance of an Event of
Default or an event which with notice or lapse of time would constitute an Event of
Default, amounts on deposit in the Construction Fund shall not be disbursed, but shall
instead be applied to the payment of debt service or redemption price of the Bonds.
(k) The rights granted to the Insurer under the Ordinance or any other Related Document to
request, consent to or direct any action are rights granted to the Insurer in consideration
of its issuance of the Insurance Policy. Any exercise by the Insurer of such rights is
merely an exercise of the Insurer's contractual rights and shall not be construed or
deemed to be taken for the benefit, or on behalf, of the Bondholders and such action does
not evidence any position of the Insurer, affirmative or negative, as to whether the
consent of the Bondowners or any other person is required in addition to the consent of
the Insurer.
(1) Only (1) cash, (2) non -callable direct obligations of the United States of America
("Treasuries"), (3) evidences of ownership of proportionate interests in future interest and
principal payments on Treasuries held by a bank or trust company as custodian, under
which the owner of the investment is the real party in interest and has the right to proceed
directly and individually against the obligor and the underlying Treasuries are not
available to any person claiming through the custodian or to whom the custodian may be
obligated, (4) subject to the prior written consent of the Insurer, pre -refunded municipal
obligations rated "AAA" and "Aaa" by S&P and Moody's, respectively, or (5) subject to
the prior written consent of the Insurer, securities eligible for "AAA" defeasance under
then existing criteria of S&P or any combination thereof, shall be used to effect
defeasance of the Bonds unless the Insurer otherwise approves. Any obligations or
securities deposited as provided in this paragraph, shall qualify under Section
1207.062(b) of the Local Government Code, as amended.
To accomplish defeasance, the Issuer shall cause to be delivered (i) a report of an
independent firm of nationally recognized certified public accountants or such other
accountant as shall be acceptable to the Insurer ("Accountant") verifying the sufficiency
of the escrow established to pay the Bonds in full on the maturity or redemption date
("Verification"), (ii) an Escrow Deposit Agreement (which shall be acceptable in form
and substance to the Insurer), (iii) an opinion of nationally recognized bond counsel to
the effect that the Bonds are no longer "Outstanding" under the Ordinance and (iv) a
certificate of discharge of the Paying Agent with respect to the Bonds; each Verification
and defeasance opinion shall be acceptable in form and substance, and addressed, to the
Issuer, Paying Agent and Insurer. The Insurer shall be provided with final drafts of the
above -referenced documentation not less than five business days prior to the funding of
the escrow.
Bonds shall be deemed Outstanding under the Ordinance unless and until they are in fact
paid and retired or the above criteria are met.
Notwithstanding the above, in the event any provisions in this Section 30(1) conflict with
Section 1207.033 of the Texas Government Code, as amended ("Section 1207.033"), the
provisions of Section 1207.033 shall prevail.
(m) Amounts paid by the Insurer under the Insurance Policy shall not be deemed paid for
purposes of the Ordinance and the Bonds relating to such payments shall remain
Outstanding and continue to be due and owing until paid by the Issuer in accordance with
the Ordinance. The Ordinance shall not be discharged unless all amounts due or to
become due to the Insurer have been paid in full or duly provided for.
(n) Each of the Issuer and Paying Agent covenant and agree to take such action (including, as
applicable, filing of UCC financing statements and continuations thereof) as is necessary
from time to time to preserve the priority of the pledge of the Trust Estate under
applicable law.
(o) Claims Upon the Insurance Policy and Payments by and to the Insurer.
If, on the third Business Day prior to the related scheduled interest payment date or
principal payment date ("Payment Date") there is not on deposit with the Paying Agent,
after making all transfers and deposits required under the Ordinance, moneys sufficient to
pay the principal of and interest on the Bonds due on such Payment Date, the Paying
Agent shall give notice to the Insurer and to its designated agent (if any) (the "Insurer's
Fiscal Agent") by telephone or telecopy of the amount of such deficiency by 12:00 noon,
New York City time, on such Business Day. If, on the second Business Day prior to the
related Payment Date, there continues to be a deficiency in the amount available to pay
the principal of and interest on the Bonds due on such Payment Date, the Paying Agent
shall make a claim under the Insurance Policy and give notice to the Insurer and the
Insurer's Fiscal Agent (if any) by telephone of the amount of such deficiency, and the
allocation of such deficiency between the amount required to pay interest on the Bonds
and the amount required to pay principal of the Bonds, confirmed in writing to the Insurer
and the Insurer's Fiscal Agent by 12:00 noon, New York City time, on such second
Business Day by filling in the form of Notice of Claim and Certificate delivered with the
Insurance Policy.
The Paying Agent shall designate any portion of payment of principal on Bonds paid by
the Insurer, whether by virtue of mandatory sinking fund redemption, maturity or other
advancement of maturity, on its books as a reduction in the principal amount of Bonds
registered to the then current Bondholder, whether DTC or its nominee or otherwise, and
shall issue a replacement Bond to the Insurer, registered in the name of Assured Guaranty
Municipal Corp., in a principal amount equal to the amount of principal so paid (without
regard to authorized denominations); provided that the Paying Agent's failure to so
designate any payment or issue any replacement Bond shall have no effect on the amount
of principal or interest payable by the Issuer on any Bond or the subrogation rights of the
Insurer.
The Paying Agent shall keep a complete and accurate record of all funds deposited by the
Insurer into the Policy Payments Account (defined below) and the allocation of such
funds to payment of interest on and principal of any Bond. The Insurer shall have the
right to inspect such records at reasonable times upon reasonable notice to the Paying
Agent.
Upon payment of a claim under the Insurance Policy, the Paying Agent shall establish a
separate special purpose trust account for the benefit of Bondholders referred to herein as
the "Policy Payments Account" and over which the Paying Agent shall have exclusive
control and sole right of withdrawal. The Paying Agent shall receive any amount paid
under the Insurance Policy in trust on behalf of Bondholders and shall deposit any such
amount in the Policy Payments Account and distribute such amount only for purposes of
making the payments for which a claim was made. Such amounts shall be disbursed by
the Paying Agent to Bondholders in the same manner as principal and interest payments
are to be made with respect to the Bonds under the sections hereof regarding payment of
Bonds. It shall not be necessary for such payments to be made by checks or wire transfers
separate from the check or wire transfer used to pay debt service with other funds
available to make such payments. Notwithstanding anything herein to the contrary, the
Issuer agrees to pay to the Insurer (i) a sum equal to the total of all amounts paid by the
Insurer under the Insurance Policy (the "Insurer Advances"); and (ii) to the extent
permitted by law and subject to annual appropriation, interest on such Insurer Advances
from the date paid by the Insurer until payment thereof in full, payable to the Insurer at
the Late Payment Rate per annum (collectively, the "Insurer Reimbursement Amounts").
"Late Payment Rate" means the lesser of (a) the greater of (i) the per annum rate of
interest, publicly announced from time to time by JPMorgan Chase Bank at its principal
office in The City of New York, as its prime or base lending rate (any change in such rate
of interest to be effective on the date such change is announced by JPMorgan Chase
Bank) plus 3%, and (ii) the then applicable highest rate of interest on the Bonds and (b)
the maximum rate permissible under applicable usury or similar laws limiting interest
rates. The Late Payment Rate shall be computed on the basis of the actual number of
days elapsed over a year of 360 days. The Issuer hereby covenants and agrees that the
Insurer Advances are secured by a lien on and pledge of the Net Revenues and payable
from such Net Revenues on a parity with debt service due on the Bonds.
Funds held in the Policy Payments Account shall not be invested by the Paying Agent
and may not be applied to satisfy any costs, expenses or liabilities of the Paying Agent.
Any funds remaining in the Policy Payments Account following a Bond payment date
shall promptly be remitted to the Insurer.
(p) The Insurer shall, to the extent it makes any payment of principal of or interest on the
Bonds, become subrogated to the rights of the recipients of such payments in accordance
with the terms of the Insurance Policy (which subrogation rights shall also include the
rights of any such recipients in connection with any Insolvency Proceeding). Each
obligation of the Issuer to the Insurer under the Related Documents shall survive
discharge or termination of such Related Documents.
(q) The Issuer shall pay or reimburse the Insurer any and all charges, fees, costs and
expenses that the Insurer may reasonably pay or incur in connection with (i) the
administration, enforcement, defense or preservation of any rights or security in any
Related Document; (ii) the pursuit of any remedies under the Ordinance or any other
Related Document or otherwise afforded by law or equity, (iii) any amendment, waiver
or other action with respect to, or related to, the Ordinance or any other Related
Document whether or not executed or completed, or (iv) any litigation or other dispute in
connection with the Ordinance or any other Related Document or the transactions
contemplated thereby, other than costs resulting from the failure of the Insurer to honor
its obligations under the Insurance Policy. The Insurer reserves the right to charge a
reasonable fee as a condition to executing any amendment, waiver or consent proposed in
respect of the Ordinance or any other Related Document.
(r) After payment of reasonable expenses of the Paying Agent, the application of funds
realized upon default shall be applied to the payment of expenses of the Issuer or rebate
only after the payment of past due and current debt service on the Bonds and amounts
required to restore the Debt Service Reserve Fund to the Debt Service Reserve
Requirement.
(s) The Insurer shall be entitled to pay principal or interest on the Bonds that shall become
Due for Payment but shall be unpaid by reason of Nonpayment by the Issuer (as such
terms are defined in the Insurance Policy) and any amounts due on the Bonds as a result
of acceleration of the maturity thereof in accordance with the Ordinance, whether or not
the Insurer has received a Notice of Nonpayment (as such terms are defined in the
Insurance Policy) or a claim upon the Insurance Policy.
(t) The notice address of the Insurer is: Assured Guaranty Municipal Corp., 31 West 52nd
Street, New York, New York 10019, Attention: Managing Director — Surveillance, Re:
Policy No. 216211-N, Telephone: (212) 826-0100; Telecopier: (212) 339-3556. In each
case in which notice or other communication refers to an Event of Default, then a copy of
such notice or other communication shall also be sent to the attention of the General
Counsel and shall be marked to indicate "URGENT MATERIAL ENCLOSED."
(u) The Insurer shall be provided with the following information by the Issuer or Paying
Agent, as the case may be:
(i) Annual audited financial statements within 180 days (or such longer
period agreed to by AGM) after the end of the Issuer's fiscal year
(together with a certification of the Issuer that it is not aware of any
default or Event of Default under the Ordinance), and the Issuer's
annual budget within 30 days after the approval thereof together with
such other information, data or reports as the Insurer shall reasonably
request from time to time;
(ii) Notice of any draw upon the Debt Service Reserve Fund within two
Business Days after knowledge thereof other than (i) withdrawals of
amounts in excess of the Debt Service Reserve Requirement and (ii)
withdrawals in connection with a refunding of Bonds;
(iii) Notice of any default known to the Paying Agent or Issuer within five
Business Days after knowledge thereof,
(iv) Prior notice of the advance refunding or redemption of any of the
Bonds, including the principal amount, maturities and CUSIP numbers
thereof;
(v) Notice of the resignation or removal of the Paying Agent and Bond
Registrar and the appointment of, and acceptance of duties by, any
successor thereto;
(vi) Notice of the commencement of any proceeding by or against the
Issuer or Obligor commenced under the United States Bankruptcy
Code or any other applicable bankruptcy, insolvency, receivership,
rehabilitation or similar law (an "Insolvency Proceeding");
(vii) Notice of the making of any claim in connection with any Insolvency
Proceeding seeking the avoidance as a preferential transfer of any
payment of principal of, or interest on, the Bonds;
(viii) A full original transcript of all proceedings relating to the execution of
any amendment, supplement, or waiver to the Related Documents; and
(ix) All reports, notices and correspondence to be delivered to Bondholders
under the terms of the Related Documents.
In addition, to the extent that the Issuer has entered into a continuing disclosure agreement,
covenant or undertaking with respect to the Bonds, all information furnished pursuant to such
agreements shall also be provided to the Insurer, simultaneously with the furnishing of such
information.
(v) The Insurer shall have the right to receive such additional information as it may
reasonably request.
(w) The Issuer will permit the Insurer to discuss the affairs, finances and accounts of the
Issuer or any information the Insurer may reasonably request regarding the security for
the Bonds with appropriate officers of the Issuer and will use commercially reasonable
efforts to enable the Insurer to have access to the facilities, books and records of the
Issuer on any business day upon reasonable prior notice.
(x) The Issuer shall notify the Insurer of any failure of the Issuer to provide notices,
certificates and other information under the transaction documents.
(y) Notwithstanding satisfaction of the other conditions to the issuance of Additional Bonds
set forth in the Ordinance, no such issuance may occur (1) if an Event of Default (or any
event which, once all notice or grace periods have passed, would constitute an Event of
Default) exists unless such default shall be cured upon such issuance and (2) unless the
Debt Service Reserve Fund is fully funded at the Debt Service Reserve Requirement
(including the proposed issue) upon the issuance of such Additional Bonds, in either case
unless otherwise permitted by the Insurer.
(z) In determining whether any amendment; consent, waiver or other action to be taken, or
any failure to take action, under the Ordinance would adversely affect the security for the
Bonds or the rights of the Bondholders, the Paying Agent shall consider the effect of any
such amendment, consent, waiver, action or inaction as if there were no Insurance Policy.
(aa) No contract shall be entered into or any action taken by which the rights of the Insurer or
security for or sources of payment of the Bonds may be impaired or prejudiced in any
material respect except upon obtaining the prior written consent of the Insurer.
(bb) If the Bonds are issued for refunding purposes, there shall be delivered an opinion of
Bond Counsel addressed to the Insurer (or a reliance letter relating thereto), or a
certificate of discharge of the Paying Agent for the Refunded Obligations, to the effect
that, upon the making of the required deposit to the escrow, the legal defeasance of the
Refunded Obligations shall have occurred. If the Refunded Obligations are insured by
Assured Guaranty Municipal Corp., at least three business days prior to the proposed date
for delivery of the Policy with respect to the Refunding Bonds, the Insurer shall also
receive (i) the verification letter, of which the Insurer shall be an addressee, by an
independent firm of certified public accountants which is either nationally recognized or
otherwise acceptable to the Insurer, of the adequacy of the escrow established to provide
for the payment of the Refunded Obligations in accordance with the terms and provisions
of the Escrow Deposit Agreement, and (ii) the form of an opinion of Bond Counsel
addressed to the Insurer (or a reliance letter relating thereto) to the effect that the Escrow
Deposit Agreement is a valid and binding obligation of the parties thereto, enforceable in
accordance with its terms (such Escrow Deposit Agreement shall provide that no
amendments are permitted without the prior written consent of the Insurer). An executed
copy of each of such opinion and reliance letter, if applicable, or Paying Agent's
discharge certificate, as the case may be, shall be forwarded to the Insurer prior to
delivery of the Bonds.
(cc) Any interest rate exchange agreement ("Swap Agreement") entered into by the Issuer
shall meet the following conditions: (i) the Swap Agreement must be entered into to
manage interest costs related to, or a hedge against (a) assets then held, or (b) debt then
outstanding, or (iii) debt reasonably expected to be issued within the next twelve (12)
months, and (ii) the Swap Agreement shall not contain any leverage element or multiplier
component greater than 1.0x unless there is a matching hedge arrangement which
effectively off -sets the exposure from any such element or component. Unless otherwise
consented to in writing by the Insurer, any uninsured net settlement, breakage or other
termination amount then in effect shall be subordinate to debt service on the Bonds and
on any debt on parity with the Bonds. The Issuer shall not terminate a Swap Agreement
unless it demonstrates to the satisfaction of the Insurer prior to the payment of any such
termination amount that such payment will not cause the Issuer to be in default under the
Related Documents, including but not limited to, any monetary obligations thereunder.
All counterparties or guarantors to any Swap Agreement must have a rating of at least
`.`A-" and "A3" by Standard & Poor's (`S&P") and Moody's Investors Service
("Moody's"). If the counterparty or guarantor's rating falls below "A-" or "A3" by either
S&P or Moody's, the counterparty or guarantor shall execute a credit support annex to
the Swap Agreement, which credit support annex shall be acceptable to the Insurer. If
the counterparty or the guarantor's long term unsecured rating falls below "Baal" or
"BBB+" by either Moody's or S&P, a replacement counterparty or guarantor, acceptable
to the Insurer, shall be required.
Any consent, approval or permit required herein by the Insurer shall not be unreasonably
withheld.
34. Paying A en�t/Registrar Agreement. The paying agent/registrar agreement (the
"Paying Agent Agreement") by and between the City and Paying Agent, a form of which is attached
hereto as Exhibit B and incorporated herein by reference as a part of this Ordinance for all purposes,
is hereby approved, together with such changes or revisions as may be necessary to accomplish the
refunding or benefit the City, is hereby authorized to be executed by the Mayor or Mayor Pro Tem
and City Clerk for and on behalf of the City.
35. Official Statement. The Preliminary Official Statement and the Official Statement
prepared in the initial offering and sale of the Bonds have been and are hereby authorized, approved
and ratified as to form and content. The use of the Preliminary Official Statement and the Official
Statement in the reoffering of the Bonds by the Underwriter is hereby approved, authorized and
ratified. The proper officials of the City are hereby authorized to execute and deliver a Bond
pertaining to the Preliminary Official Statement and the Official Statement as prescribed therein,
dated as of the date set forth in the Officer's Pricing Certificate.
36. No Personal Liability. No recourse shall be had for payment of the principal of or
interest on any Bonds or for any claim based thereon, or on this Ordinance, against any official
or employee of the City or any person executing any Bonds.
37. Continuing Disclosure Undertaking.
(a) Annual Reports. The City undertakes and agrees for the benefit of the Bond holders to
provide annually to the MSRB, 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 final
Official Statement authorized in this Ordinance (i) under the headings "INVESTMENT
AUTHORITY AND INVESTMENT OBJECTIVES OF THE CITY;" "DEBT STATEMENT;"
"TAX DATA;" "SELECTED FINANCIAL DATA;" ."ADMINISTRATION OF THE CITY;" and
in APPENDIX B. The information to be provided shall include the financial statements of the City
prepared in accordance with the accounting principles the City may be required to employ from
time to time pursuant to State law or regulation and audited, if the audit is completed within the
period during which they must be provided. If the audit of such financial statements is not
completed within such period, then the City shall provide unaudited financial statements for the
applicable fiscal year to the MSRB within such six month period, and audited financial statements
when the audit report on such statement becomes available.
If the City changes its fiscal year, it will notify the MSRB of the change (and of the date of the new fiscal
year end) prior to the next date by which the City otherwise would be required to provide financial information and
operating data pursuant to this Section.
The financial information and operating data to be provided pursuant to this Section may be set forth in full
in one or more documents or may be included by specific reference to any document (including an official statement
or other offering document, if it is available from the MSRB) that theretofore has been provided to the MSRB or
filed with the SEC.
(b) Material Event Notices. The City shall notify 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:
i. Principal and interest payment delinquencies;
ii. Non-payment related defaults, if material;
iii. Unscheduled draws on debt service reserves reflecting financial difficulties;
iv. Unscheduled draws on credit enhancements reflecting financial difficulties;
V. Substitution of credit or liquidity providers, or their failure to perform;
vi. Adverse tax opinions or the issuance by the Internal Revenue Service of
proposed or final determination of taxability, Notices of Proposed Issue (IRS
Form 5701-TEB) or other material notices or determinations with respect to
the tax status of the security, or other material events affecting the tax status
of the security;
vii. Modifications to rights of Bondholders, if material;
viii. Bond calls, if material, and tender offers;
ix. Defeasances;
X. Release, substitution or sale of property securing repayment of the securities,
if material;
xi. Rating changes;
xii. Bankruptcy, insolvency, or receivership, or similar event of the obligated
person;
xiii. The consummation of a merger, consolidation, or acquisition involving an
obligated person or the sale of all or substantially all of the assets of the
obligated person, other than in the ordinary course of business, the entry into
a definitive agreement or undertake such action, or the termination of a
definitive agreement relating to any such actions, other than pursuant to its
terms, if material; and
xiv. Appointment of a successor or additional trustee or the change of name of a
trustee, if material.
The City shall notify the MSRB, in a timely manner, of any failure by the City to provide financial
information or operating data in accordance with section (a) above. All documents provided to the MSRB shall be
ed by identifying information as prescribed by the MSRB.
(c) Limitations, Disclaimers and Amendments. The City shall be obligated to observe
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.
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, WHETHER NEGLIGENT OR WITHOUT
FAULT ON ITS PART, OF ANY COVENANT SPECIFIED IN THIS SECTION OR FROM ANY STATEMENT
MADE PURSUANT TO THIS SECTION. HOLDERS OR BENEFICIAL OWNERS OF BONDS MAY SEEK AS
THEIR SOLE REMEDY A WRIT OF MANDAMUS TO COMPEL THE CITY TO COMPLY WITH ITS
AGREEMENT.
No default by the City with respect to its continuing disclosure agreement shall constitute a breach of or
default under this Ordinance for purposes of any other provision of this Ordinance.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the duties of the City
under federal and state securities laws.
The provisions of this Section may be amended by the City from time to time to adapt to changed
circumstances that arise from a change in legal requirements, a change in law, or a change in the identity, nature,
status or type of operations of the City, if (i) the agreement, as amended, would have permitted the Underwriter to
purchase or sell the Bonds in the initial primary offering in compliance with the Rule, taking into account any
amendments or interpretations of such rule to the date of such amendment, as well as such changed circumstances,
and (ii) either (a) the holders of a majority in aggregate principal amount of the outstanding Bonds consent to such
amendment, or (b) any person unaffiliated with the City (such as nationally recognized bond counsel) determines 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 obligations and agreement in this Section if the SEC amends or repeals the applicable
provisions of the Rule or a court of final jurisdiction determines that such provisions are invalid, and the City may
amend the agreement in its discretion in any other circumstance or manner, but in either case only to the extent that
its right to do so would not prevent an underwriter from lawfully purchasing or reselling the Bonds in the primary
offering of the Bonds in compliance with the Rule. If the City amends its agreement, it must include with the next
financial information and operating data provided in accordance with its agreement an explanation, in narrative
form, of the reasons for the amendment and of the impact of any change in the type of information and operating
data so provided.
38. Repealer. All orders, resolutions, and ordinances, and parts thereof inconsistent herewith are hereby
repealed to the extent of such inconsistency.
39. Effective Date. This Ordinance shall be in force and effect from and after its final passage, and it is so
ordered.
40. Amendment of Ordinance.
(a) If and to the extent permitted by this Ordinance, the owners of the Bonds aggregating
in the principal amount of 51% of the aggregate principal amount of the outstanding Bonds shall
have the right from time to time to approve any amendment to this Ordinance which may be
deemed necessary or desirable by the City provided, however, that without the consent of the
owners of all of the Bonds at the time outstanding, nothing herein contained shall permit or be
construed to permit the amendment of the terms and conditions in this Ordinance or in the Bonds
so as to:
(1) Make any change in the maturity of the outstanding Bonds;
(2) Reduce the rate of interest borne by any of the outstanding Bonds;
(3) Reduce the amount of the principal payable on the outstanding Bonds;
(4) Modify the terms of payment of principal of or interest on the outstanding
Bonds, or impose any conditions with respect to such payment;
(5) Affect the owners of less than all of the outstanding Bonds then
outstanding;
(6) Change the percentage of the principal amount of outstanding Bonds,
necessary for consent to such amendment.
(b) If at any time the City shall desire to amend this Ordinance under this Section, the
City shall cause notice of the proposed amendment to be published in a financial newspaper or
journal published in The City of New York, New York, once during each calendar week for at
least two successive calendar weeks. Such notice shall briefly set forth the nature of the
proposed amendment and shall state that a copy thereof is on file at the principal office of the
Paying Agent for inspection by all owners of the Bonds.' Such publication is not required,
however, if notice in writing is given to each owner of the outstanding Bonds. Not less than
thirty (30) days' notice of the proposed amendment shall also be given by the City to the
Underwriter.
(c) Whenever at any time not less than thirty (30) days, and within one (1) year, from
the date of the publication of said notice or other service of written notice the City shall receive
an instrument or instruments executed by the owners of at least 51% in aggregate principal
amount of the Bonds then outstanding, which instrument or instruments shall refer to the
proposed amendment described in said notice and which specifically consent to and approve
such amendment in substantially the form of the copy thereof on file with the Paying Agent, the
City Council may adopt the amendatory resolution in substantially the same form.
(d) Upon adoption of any amendatory resolution pursuant to the provision of this
Section, this Ordinance shall be deemed to be amended in accordance with such amendatory
resolution, and the respective rights, duties and Bonds under this Ordinance of the City and all
the owners of then outstanding Bonds, shall thereafter be determined, exercised and enforced
hereunder, subject in all respect to such amendments.
(e) Any consent given by the owner of the outstanding Bonds pursuant to the
provisions of this Section shall be irrevocable for a period of six months from the date of the first
publication of the notice provided for in this Section, and shall be conclusive and binding upon
all future owners of the same Bonds, during such period. Such consent may be revoked at any
time after six months from the date of the first publication of such notice by the owner who gave
such consent, or by a successor in title, by filing notice thereof with the Paying Agent and the
City, but such revocation shall not be effective if the owners of 51% in aggregate principal
amount of the then outstanding Bonds, as in this Section defined have, prior to the attempted
revocation, consented to and approved the amendment.
(f) For the purpose of this Section, the fact of the owning of Bonds, by any owner of
Bonds, and the amount and number of such Bonds, and the date of their owning same shall be
determined by the Registration Books of the Paying Agent/Registrar.
(g) The foregoing provisions of this Section notwithstanding, the City by action of
the City Council (or as item (2) by the City Council or by the Mayor, Mayor Pro Tem, City
Manager or Chief Financial Officer as to changes prior to issuance to comply with requirements
by the Attorney General of Texas or Underwriter) may amend this Ordinance for any one or
more of the following purposes:
(1) To add to the covenants and agreements of the City in this
Ordinance contained, other covenants and agreements thereafter to be observed,
grant additional rights or remedies to the owners of bonds or to surrender, restrict
or limit any right or power herein reserved to or conferred upon the City.
(2) To make such provisions for the purpose of clarifying matters or
questions arising under this Ordinance, as are required by the Attorney General of
Texas to obtain the Attorney General's approval of the issuance of the Bonds or
required by the Underwriter before their issuance or for the purpose of curing any
ambiguity, or curing, correcting or supplementing any defective provision
contained in this Ordinance, or at any time before or after issuance as are
necessary or desirable and not contrary to or inconsistent with this Ordinance, and
in all events which shall not adversely affect the interests of the owners of the
Bonds.
(3) To modify any of the provisions of this Ordinance in any other
respect whatever, provided that: (i) such modification shall be, and be expressed
to be, effective only after all Bonds outstanding at the date of the adoption of such
modification shall cease to be outstanding, and (ii) such modification shall be
specifically referred to in the text of all Bonds issued after the date of the adoption
of such modification.
41. Related Matters. To satisfy in a timely manner all of the City's obligations under
this Ordinance, the Mayor or Mayor Pro Tem, City Manager, Chief Financial Officer,
City Clerk or any Deputy City Clerk, and all other appropriate officers and agents of
the City are hereby authorized and directed to take all other actions that are
reasonably necessary to provide for the issuance of the Bonds, including without
limitation, executing and delivering on behalf of the City all Bonds, consents,
receipts, requests, and other documents as may be reasonably necessary to satisfy the
City's obligations under this Ordinance and to direct the application of funds of the
City consistent with the provisions of this Ordinance.
42. Open Meeting. It is hereby officially found and determined that 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 Chapter 551 of
the Texas Government Code.
43. Interpretations. All terms defined herein and all pronouns used in this Ordinance
shall be deemed to apply equally to singular and plural and to all genders. The titles
and headings of the sections of this Ordinance have been inserted for convenience of
reference only and are not to be considered a part hereof and shall not in any way
modify or restrict any of the terms or provisions hereof. This Ordinance and all of the
terms and provisions hereof shall be liberally construed to effectuate the purposes set
forth herein and to sustain the validity of the Bonds and the validity of the lien on and
pledge of the Net Revenues to secure the payment of the Bonds.
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PASSED BY THE CITY COUNCIL of the City of Beaumont this the 5t` day of May, 2015.
k
V
ATTEST:
City Clerk
(SEAL)
Mayor Bee cy Ames -
SCHEDULEI
REFUNDED OBLIGATIONS
Certain maturities of:
The City of Beaumont, Texas, General Obligation Refunding Bonds, Series 2006
The City of Beaumont, Texas Certificates of Obligation, Series 2006
The City of Beaumont, Texas Certificates of Obligation, Series 2008
The City of Beaumont, Texas Certificates of Obligation, Series 2009
Exhibit A
EXHIBIT "A"
ESCROW AGREEMENT
Exhibit A
EXHIBIT "B"
PAYING AGENUREGISTRAR AGREEMENT
Exhibit B
EXHIBIT "C"
BOND PURCHASE AGREEMENT
Exhibit C
EXHIBIT "D"
OFFICER'S PRICING CERTIFICATE
Exhibit D