Loading...
HomeMy WebLinkAbout1988-1762 - Ordinance - 06/15/1988Ordinance No. 1762 ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF COLLEGE STATION, TEXAS, GENERAL OBLIGATION REFUNDING BONDS, SERIES 1988 WHEREAS, there are presently outstanding the following obligations of the following series of the City of College Station (the "Issuer"), which are secured by a pledge by the Issuer to levy ad valorem taxes sufficient to pay principal of and interest on such obligations as they become due: City of College Station, Texas, Certificate of Obligation, Series 1981 No. 00003, dated as of July 24, 1981, as modified and revised as of March 11, 1982, currently outstanding in the aggregate principal amount of $1,150,907.45, plus accrued interest, due July 15, 1988 (the "Refunded Certificate of Obligation"); City of College Station, Texas, Public Property Finance Contractual Obligations, Series 1988, dated May 15, 1988, currently outstanding in the aggregate principal amount of $1,500,000, plus accrued interest, and callable at any time (the "Refunded Contractual Obligations"); WHEREAS, the Issuer now desires to refund all of the Refunded Certificate of Obligation and the Refunded Contractual obligations, currently outstanding in the aggregate principal amount of $2,650,907.45 (collectively, the "Refunded Obligations"); WHEREAS, Article 717k, Vernon's Texas Civil Statutes, as amended (the "Act"), authorizes the Issuer to issue refunding bonds and to deposit the proceeds from the sale thereof to- gether with any other available funds or resources, directly with a place of payment (paying agent) for any of the Refunded Obligations, and such deposit, if made before such payment dates, shall constitute the making of firm banking and finan- cial arrangements for the discharge and final payment of the Refunded Obligations; WHEREAS, the City Council of the Issuer (the "Council") deems it advisable to refund the Refunded Obligations in order to lower the annual debt service requirements of the Issuer and to restructure the Issuer's debt service in a manner which will permit the issuance of additional general obligation bonds without a tax rate increase or with a smaller increase than would otherwise be required; 0O532O WHEREAS, all the Refunded Obligations mature or are subject to redemption prior to maturity within 20 years of the date of the bonds hereinafter authorized; WHEREAS, it is now deemed necessary and advisable that said bonds be issued at this time, in the amounts, and for the purpose as herein shown; and WHEREAS, the bonds hereinafter authorized are to be issued and delivered pursuant to the Act and the Charter of the Issuer. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF COLLEGE STATION, TEXAS, THAT: Section 1. AMOUNT AND PURPOSE OF THE BONDS. The bonds of City of College Station (the "Issuer") are hereby authorized to be issued and delivered in the aggregate principal amount of $2,850,000, FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND THE ISSUER'S OUTSTANDING OBLIGATIONS (as described in the preamble hereto). Section 2. DESIGNATION, DATE, DENOMINATIONS, NUMBERS, AND MATURITIES OF BONDS. Each bond issued pursuant to this Ordi- nance shall be designated: "CITY OF COLLEGE STATION, TEXAS, GENERAL OBLIGATION REFUNDING BOND, SERIES 1988", and initially there shall be issued, sold, and delivered hereunder fully registered bonds, without interest coupons, dated July 1, 1988, in the respective denominations and principal amounts herein- after stated, payable to the respective initial registered owners thereof (as designated in Section 11 hereof), or to the registered assignee or assignees of said bonds or any portion or portions thereof (in each case, the "Registered Owner", "Owner", or "owner"). The term "Bonds" as used in this Ordinance shall mean and include collectively the bonds initially issued and delivered pursuant to this Ordinance and all substitute bonds exchanged therefor, as well as all other substitute bonds and replacement bonds issued pursuant hereto, and the term "Bond" shall mean any of the Bonds. The Bonds shall be numbered R-1 upward, shall be in the denomination of $5,000 each or any integral multiple thereof, and shall mature and be payable serially on March 1 in each of the years and in the principal amounts, respectively as set forth in the following schedule: YEARS AMOUNTS YEARS AMOUNTS 1989 $ 100,000 1993 $ 325,000 1990 175,000 1994 200,000 1991 275,000 1995 125,000 1992 300,000 1996 1,350,000 Section 3. INTEREST. The Bonds scheduled to mature during the years, respectively, set forth below shall bear 2 n05321 interest from the dates specified in the FORM OF BOND set forth in this Ordinance to their respective dates of maturity or redemption prior to maturity at the following rates per annum: YEAR OF INTEREST YEAR OF INTEREST MATURITY RATE MATURITY RATE 1989 8.15% 1993 6.15% 1990 8.15 1994 6.30 1991 8.15 1995 6.40 1992 7.00 1996 6.50 Said interest shall be payable in the manner provided and on the dates stated in the FORM OF BOND set forth in this Ordi- nance. Section 4. CHARACTERISTICS OF THE BONDS. (a) Registra- tion. Transfer. and Exchange; Authentication. The Issuer shall keep or cause to be kept at the principal corporate trust office of First City National Bank of Houston, Houston, Texas (the "Paying Agent/Registrar") books or records for the registration of the transfer and exchange of the Bonds (the "Registration Books"), and the Issuer hereby appoints the Paying Agent/Registrar as its registrar and transfer agent to keep such books or records and make such registrations of transfers and exchanges under such reasonable regulations as the Issuer and Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such registrations, transfers, and exchanges as herein provided. The Paying Agent/Registrar shall obtain and record in the Registration Books the address of the registered owner of each Bond to which payments with respect to the Bonds shall be mailed, as herein provided; but it shall be the duty of each registered owner to notify the Paying Agent/Registrar in writing of the address to which payments shall be mailed, and such interest payments shall not be mailed unless such notice has been given. To the extent possible and under reasonable circumstances, all transfers of Bonds shall be made within three business days after request and presentation thereof. The Issuer shall have the right to inspect the Registration Books during regular business hours of the Paying Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books confidential and, unless otherwise required by law, shall not permit their inspection by any other entity. The Paying Agent/Registrar's standard or customary fees and charges for making such registration, transfer, exchange and delivery of a substitute Bond or Bonds shall be paid as provided in the FORM OF BOND set forth in this Ordinance. Registration of assignments, transfers, and exchanges of Bonds shall be made in the manner provided and with the effect stated in the FORM OF BOND set forth in this Ordinance. Each substitute Bond shall bear a letter and/or number to distinguish it from each other Bond. 005322 3 Except as provided in (c) below, an authorized representa- tive of the Paying Agent/Registrar shall, before the delivery of any such Bond, date and manually sign the Paying Agent/Reg- istrar's Authentication Certificate, and no such Bond shall be deemed to be issued or outstanding unless such Certificate is so executed. The Paying Agent/Registrar promptly shall cancel all paid Bonds and Bonds surrendered for transfer and exchange. No additional ordinances, orders, or resolutions need be passed or adopted by the governing body of the Issuer or any other body or person so as to accomplish the foregoing transfer and exchange of any Bond or portion thereof, and the Paying Agent/ Registrar shall provide for the printing, execution, and delivery of the substitute Bonds in the manner prescribed herein, and said Bonds shall be of type composition printed on paper with lithographed or steel engraved borders of customary weight and strength. Pursuant to Vernon's Ann. Tex. Civ. St. Art. 717k-6, and particularly Section 6 thereof, the duty of transfer and exchange of Bonds as aforesaid is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of said certificate, the transferred and exchanged Bond shall be valid, incontestable, and enforceable in the same manner and with the same effect as the Bonds which initially were issued and delivered pursuant to this Ordinance, approved by the Attorney General, and registered by the Comptroller of Public Accounts. (b) Payment of Bonds and Interest. The Issuer hereby further appoints the Paying Agent/Registrar to act as the paying agent for paying the principal of and interest on the Bonds, all as provided in this Ordinance. The Paying Agent/ Registrar shall keep proper records of all payments made by the Issuer and the Paying Agent/Registrar with respect to the Bonds. The Mayor and City Secretary are hereby authorized to execute an agreement with the Paying Agent/Registrar substantially in the form presented at this meeting. (c) In General. The Bonds (i) shall be issued in fully registered form, without interest coupons, with the principal of and interest on such Bonds to be payable only to the regis- tered owners thereof, (ii) may be redeemed prior to their scheduled maturities, (iii) may be transferred and assigned, (iv) may be exchanged for other Bonds, (v) shall have the characteristics, (vi) shall be signed, sealed, executed, and authenticated, (vii) shall have the principal of and interest on the Bonds be payable, and (viii) shall be administered and the Paying Agent/Registrar and the Issuer shall have certain duties and responsibilities with respect to the Bonds, all as provided, and in the manner and to the effect as required or indicated, in the FORM OF BOND set forth in this Ordinance. The Bonds initially issued and delivered pursuant to this Ordinance numbered R-1 through R-8 ( collectively, the "Initial Bonds") shall be delivered to the initial purchaser and are not required to be, and shall not be, authenticated by the Paying Agent/Registrar, but on each substitute Bond issued in exchange 005323 for the Initial Bonds or any Bond or Bonds issued under this Ordinance the Paying Agent/Registrar shall execute the PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE, in the form set forth in the FORM OF BOND. (d) Substitute Paving Agent/Registrar. The Issuer covenants with the registered owners of the Bonds that at all times while the Bonds are outstanding the Issuer will provide a competent and legally qualified bank, trust company, financial institution, or other agency to act as and perform the services of Paying Agent/Registrar for the Bonds under this Ordinance, and that the Paying Agent/Registrar will be one entity. The Issuer reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less than 120 days written notice to the Paying Agent/Registrar, to be effective not later than 60 days prior to the next principal or interest payment date after such notice. In the event that the entity at any time acting as Paying Agent/Registrar (or its successor by merger, acquisition, or other method) should resign or other- wise cease to act as such, the Issuer covenants that promptly it will appoint a competent and legally qualified bank, trust company, financial institution, or other agency to act as Paying Agent/Registrar under this Ordinance. Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Regis- trar promptly shall transfer and deliver the Registration Books (or a copy thereof), along with all other pertinent books and records relating to the Bonds, to the new Paying Agent/Regis- trar designated and appointed by the Issuer. Upon any change in the Paying Agent/Registrar, the Issuer promptly will cause a written notice thereof to be sent by the new Paying Agent/Registrar to each registered owner of the Bonds, by United States mail, first-class postage prepaid, which notice also shall give the address of the new Paying Agent/ Registrar. By accepting the position and performing as such, each Paying Agent/Registrar shall be deemed to have agreed to the provi- sions of this Ordinance, and a certified copy of this Ordinance shall be delivered to each Paying Agent/Registrar. Section 5. FORM OF BONDS. The form of the Bonds, includ- ing the form of Paying Agent/Registrar's Authentication Certificate, the form of Assignment, and the form of Registra- tion Certificate of the Comptroller of Public Accounts of the State of Texas to be attached to the Bonds initially issued and delivered pursuant to this Ordinance, shall be, respectively, substantially as follows, with such appropriate variations, omissions, or insertions as are permitted or required by this Ordinance. 5 n05321 [FORM OF BOND] [Form of Front Panel of Bond] NO. R- United States of America PRINCIPAL State of Texas AMOUNT CITY OF COLLEGE STATION, TEXAS, GENERAL OBLIGATION REFUNDING BOND SERIES 1988 INTEREST RATE MATURITY DATE ISSUE DATE CUSIP NO. July 1, 1988 OWNER: PRINCIPAL AMOUNT: DOLLARS ON THE MATURITY DATE, specified above, THE CITY OF COLLEGE STATION, a home rule city and municipal corporation located in Brazos County, Texas (the "Issuer"), hereby promises to pay to the Registered Owner, specified above, or registered assigns (hereinafter called the "registered owner") the principal amount set forth above, and to pay interest thereon from the Issue Date, specified above, on March 1, 1989, and semiannually on each September 1 and March 1 thereafter to the maturity date specified above, or the date of redemption prior to maturity, at the interest rate per annum specified above; except that if this Bond is required to be authenticated and the date of its authentication is later than the first Record Date (hereinafter defined), such principal amount shall bear interest from the interest payment date next preceding the date of authentica- tion, unless such date of authentication is after any Record Date but on or before the next following interest payment date, in which case such principal amount shall bear interest from such next following interest payment date; provided, however, that if on the date of authentication hereof the interest on the Bond or Bonds, if any, for which this Bond is being ex- changed is due but has not been paid, then this Bond shall bear interest from the date to which such interest has been paid in full. THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the United States of America, without exchange or collection charges. The principal of this Bond shall be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity or upon the date fixed for its redemption prior to maturity, at the principal corporate trust office of First City National Bank of Houston, Houston, Texas, or its successor, which is the "Paying Agent/Registrar" for this Bond. The payment of interest on this Bond shall be made by the Paying Agent/Registrar to the registered owner hereof on each interest payment date by check, dated as of such interest payment date, drawn by the Paying Agent/Registrar on, 005325 6 and payable solely from, funds of the Issuer required by the ordinance authorizing the issuance of this Bond adopted on June 15, 1988 (the "Bond Ordinance") to be on deposit with the Paying Agent/Registrar for such purpose as hereinafter pro- vided; and such check shall be sent by the Paying Agent/Registrar by United States mail, first-class postage pre- paid, on each such interest payment date, to the registered owner hereof, at its address as it appeared on the fifteenth calendar day of the month next preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described. In addition, interest may be paid by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the registered owner. THIS BOND is one of a Series of Bonds dated July 1, 1988, authorized in accordance with the Constitution and laws of the State of Texas in the original principal amount of $2,850,000 FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND CERTAIN OF THE IS- SUER'S OUTSTANDING OBLIGATIONS (as described in the preamble to the Bond Ordinance). REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THE BOND SET FORTH ON THE REVERSE HEREOF, WHICH PROVISIONS SHALL HAVE THE SAME FORCE AND EFFECT AS SET FORTH IN THIS SPACE. IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or facsimile signature of the Mayor of the Issuer and countersigned with the manual or facsimile signature of the City Secretary of the Issuer, and has caused the official seal of the Issuer to be duly impressed, or placed in facsimile, on this Bond. CITY OF COLLEGE STATION (facsimile signature) (facsimile signature) City Secretary Mayor [Form of Back Panel of Bond] THE BONDS are issued pursuant to the Bond Ordinance whereunder the Issuer covenants to levy a continuing direct annual ad valorem tax on taxable property within the Issuer, not to exceed $2.50 per assessed $100 valuation, as provided in Article XI, Section 5 of the Texas Constitution, for each year while any part of the Bonds are considered outstanding under the provisions of the Bond Ordinance, in sufficient amount to pay interest on each Bond as it becomes due, to provide a sinking fund for the payment of the principal of the Bonds when due, and to pay the expenses of assessing and collecting such tax, all as more specifically provided in the Bond Ordinance. Reference is hereby made to the Bond Ordinance for provisions with respect to the custody and application of the Issuer's funds, remedies in the event of a default hereunder or thereunder, and the other rights of the Registered Owner. 005326 THIS BOND IS TRANSFERABLE OR EXCHANGEABLE only upon presentation and surrender at the principal corporate office of the Paying Agent/Registrar. If this Bond is being transferred, it shall be duly endorsed for transfer or accompanied by an assignment duly executed by the Registered Owner, or his authorized representative, subject to the terms and conditions of the Bond Ordinance. ANY ACCRUED INTEREST DUE at maturity or upon the redemp- tion of this Bond prior to maturity as provided herein shall be paid to the registered owner upon presentation and surrender of this Bond for redemption and payment at the principal corporate trust office of the Paying Agent/Registrar. The Issuer cove- nants with the registered owner of this Bond that on or before each principal payment date, interest payment date, and accrued interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Interest and Sinking Fund" created by the Bond Ordinance, the amounts required to provide for the payment, in immediately available funds, of all principal of and interest on the Bonds, when due. IF THE DATE for the payment of the principal of or inter- est on this Bond shall be a Saturday, a Sunday, a legal holiday, or a day on which banking institutions in the city where the principal corporate trust office of the Paying Agent/Registrar is located are authorized by law or executive order to close, or the United States Postal Service is not open for business, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are authorized to close, or the United States Postal Service is not open for business; and payment on such date shall have the same force and effect as if made on the original date payment was due. ON MARCH 1, 1993, or on any date thereafter, the Bonds of this Series may be redeemed prior to their scheduled maturities, at the option of the Issuer, with funds derived from any available and lawful source, as a whole, or in part (provided that a portion of a Bond may be redeemed only in an integral multiple of $5,000) at the redemption price of the principal amount of Bonds called for redemption, plus accrued interest thereon to the date fixed for redemption. If less than all of the Bonds are to be redeemed, the Issuer shall determine the maturity or maturities and the amounts thereof to be redeemed and shall direct the Paying Agent/Registrar to call by lot Bonds, or portions thereof, within such maturity or maturities and in such principal amounts, for redemption. AT LEAST 30 days prior to the date fixed for any redemp- tion of Bonds or portions thereof prior to maturity, a written notice of such redemption shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, to the registered owner of each Bond to be redeemed at its address as it appeared on the day such redemption notice is 005327 8 mailed; provided, however, that the failure to send, mail, or receive such notice, or any defect therein or in the sending or mailing thereof, shall not affect the validity or effectiveness of the proceedings for the redemption of any Bond. By the date fixed for any such redemption, due provision shall be made with the Paying Agent/Registrar for the payment of the required redemption price for the Bonds or portions thereof which are to be so redeemed. If such written notice of redemption is mailed and if due provision for such payment is made, all as provided above, the Bonds or portions thereof which are to be so redeemed thereby automatically shall be treated as redeemed prior to their scheduled maturities, and they shall not bear interest after the date fixed for redemption, and they shall not be regarded as being outstanding except for the right of the registered owner to receive the redemption price from the Paying Agent/Registrar out of the funds provided for such payment. If a portion of any Bond shall be redeemed, a substi- tute Bond or Bonds having the same maturity date, bearing interest at the same rate, being in any denomination or denominations in any integral multiple of $5,000 (at the written request of the registered owner), and being in an aggregate principal amount equal to the unredeemed portion thereof will be issued to the registered owner upon the surrender thereof for cancellation, at the expense of the Issuer, all as provided in the Bond Ordinance. ALL BONDS OF THIS SERIES are issuable solely as fully registered Bonds, without interest coupons, in the denomination of any integral multiple of $5,000. As provided in the Bond Ordinance, this Bond, or any unredeemed portion hereof, may, at the request of the registered owner or the assignee or assign- ees hereof, be assigned, transferred, and exchanged for a like aggregate principal amount of fully registered Bonds, without interest coupons, payable to the appropriate registered owner, assignee, or assignees, as the case may be, having the same denomination or denominations in any integral multiple of $5,000 as requested in writing by the appropriate registered owner, assignee, or assignees, as the case may be, upon surren- der of this Bond to the Paying Agent/Registrar for cancella- tion, all in accordance with the form and procedures set forth in the Bond ordinance. Among other requirements for such assignment and transfer, this Bond must be presented and surrendered to the Paying Agent/Registrar, together with proper instruments of assignment, in form and with guarantee of signa- tures satisfactory to the Paying Agent/Registrar, evidencing assignment of this Bond or any portion or portions hereof in any integral multiple of $5,000 to the assignee or assignees in whose name or names this Bond or any such portion or portions hereof is or are to be registered. The form of Assignment printed or endorsed on this Bond may be executed by the regis- tered owner to evidence the assignment hereof, but such method is not exclusive, and other instruments of assignment satisfac- tory to the Paying Agent/Registrar may be used to evidence the assignment of this Bond or any portion or portions hereof from 9 005328 time to time by the registered owner. The person requesting such transfer and exchange shall pay the Paying Agent/Regis- trar's reasonable standard or customary fees and charges for transferring and exchanging any Bond or portion thereof. In any circumstance, any taxes or governmental charges required to be paid with respect thereto shall be paid by the person requesting such assignment, transfer, or exchange, as a condition precedent to the exercise of such privilege. The foregoing notwithstanding, in the case of the exchange of a portion of a Bond which has been redeemed prior to maturity, as provided herein, and in the case of the exchange of an assigned and transferred Bond or Bonds or any portion or portions thereof, such fees and charges of the Paying Agent/Registrar will be paid by the Issuer. The Paying Agent/Registrar shall not be required to make any such transfer or exchange (i) during the period commencing with the close of business on any Record Date and ending with the opening of business on the next following principal or interest payment date or (ii) with respect to any Bond or any portion thereof called for redemp- tion prior to maturity, within 45 days prior to its redemption date. IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly will appoint a competent and legally qualified substi- tute therefor, and cause written notice thereof to be mailed to the registered owners of the Bonds. BY BECOMING the registered owner of this Bond, the regis- tered owner thereby acknowledges all of the terms and provi- sions of the Bond Ordinance, agrees to be bound by such terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for inspection in the official minutes and records of the governing body of the Issuer, and agrees that the terms and provisions of this Bond and the Bond Ordi- nance constitute a contract between each registered owner hereof and the Issuer. IT IS HEREBY CERTIFIED, RECITED, AND COVENANTED THAT this Bond has been duly and validly authorized, issued, and de- livered; all acts, conditions, and things required or proper to be performed, exist, and be done precedent to or in the authorization, issuance, and delivery of this Bond have been performed, existed, and been done in accordance with law; and ad valorem taxes sufficient to provide for the payment of the interest on and principal of this Bond, as such interest comes due, and as such principal matures, have been levied and ordered to be levied against all taxable property in the Issuer, and have been pledged for such payment, within the limit prescribed by law. n05329 Im [FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE]* * Printer - Do not print on Initial Bonds PAYING AGENT/REGISTRAR'S AUTHENTICATION It is hereby certified that this Bond has been issued under the provisions of the Bond Ordinance described in the text of this Bond; and that this Bond has been issued in exchange for, a bond, bonds, or a portion of a bond or bonds of a Series which originally was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas. Dated FIRST CITY NATIONAL BANK HOUSTON, TEXAS Paying Agent/Registrar By Authorized Signature [FORM OF ASSIGNMENT] ASSIGNMENT OF HOUSTON, FOR VALUE RECEIVED, the undersigned registered owner of this bond or duly authorized representative or attorney there- of, hereby assigns this bond to (Assignee's Social (print or typewrite Assignee's name Security or Taxpayer and address, including zip code) Identification Number) and hereby irrevocably constitutes and appoints attorney to transfer the registration of this bond on the Bond Registration Books with full power of substitution in the premises. Dated: Signature Guaranteed: NOTICE: The signature of the Registered Owner must be gua- ranteed by a member of the New York Stock Exchange or a commercial bank or trust company. Registered Owner NOTICE: This signature must correspond with the name of the Registered Owner appearing on the face of this bond in every 11 005330 particular way without alter- ation or enlargement or any change whatsoever The following abbreviations, when used in the assignment above or on the face of the within Bond, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common UNIF GIFT MIN ACT - ...... Custodian ...... (Gust) (Minor) under Uniform Gifts to Minors Act . (State) Additional abbreviations may also be used though not in the list above. [FORM OF REGISTRATION CERTIFICATE OF THE COMPTROLLER OF PUBLIC ACCOUNTS]* *Printer - Print on Initial Bonds only COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO. I hereby certify that this Bond has been examined, cer- tified as to validity, and approved by the Attorney General of the State of Texas, and that this Bond has been registered by the Comptroller of Public Accounts of the State of Texas. Witness my signature and seal this COMPTROLLER'S SEAL Comptroller of Public Accounts of the State of Texas 12 n05331 [FORM OF STATEMENT OF INSURANCE] STATEMENT OF Municipal Bond Guaranty Insurance Policy No. 2848BE (the "Policy") with respect to payments due for principal of and interest on this Bond has been issued by AMBAC Indemnity Corporation ("AMBAC Indemnity"). The Policy has been delivered to the United States Trust Company of New York, New York, New York, as the Insurance Trustee under said Policy and will be held by such Insurance Trustee or any successor insurance trustee. The Policy is on file and available for inspection at the principal office of the Insurance Trustee and a copy thereof may be secured from AMBAC Indemnity or the Insurance Trustee. All payments required to be made under the Policy shall be made in accordance with the provisions thereof. The owner of this Bond acknowledges and consents to the subrogation rights of AMBAC Indemnity as more fully set forth in the Policy. [END OF FORM] Section 6. TAX LEVY. A special Interest and Sinking Fund (the "Interest and Sinking Fund") is hereby created solely for the benefit of the Bonds, and the Interest and Sinking Fund shall be established and maintained by the Issuer at an offi- cial depository bank of the Issuer. The Interest and Sinking Fund shall be kept separate and apart from all other funds and accounts of the Issuer, and shall be used only for paying the interest on and principal of the Bonds. All ad valorem taxes levied and collected for and on account of the Bonds shall be deposited, as collected, to the credit of the Interest and Sinking Fund. During each year while any of the Bonds or interest thereon are outstanding and unpaid, the Council shall compute and ascertain a rate and amount of ad valorem tax which will be sufficient to raise and produce the money required to pay the interest on the Bonds as such interest comes due, and to provide and maintain a sinking fund adequate to pay the principal of its Bonds as such principal matures (but never less than 2% of the original principal amount of said Bonds as a sinking fund each year); and said tax shall be based on the latest approved tax rolls of the Issuer, with full allowance being made for tax delinquencies and the cost of tax collection. Said rate and amount of ad valorem tax is hereby levied, and is hereby ordered to be levied, against all taxable property in the Issuer for each year while any of the Bonds or interest thereon are outstanding and unpaid; and said tax shall be assessed and collected each such year and deposited to the credit of the aforesaid Interest and Sinking Fund. Said ad valorem taxes sufficient to provide for the payment of the interest on and principal of the Bonds, as such interest comes due and such principal matures, are hereby pledged for such payment, within the limit prescribed by law. 005332 13 Section 7. PAYMENT PROCEDURE PURSUANT TO MUNICIPAL BOND GUARANTY INSURANCE POLICY. As long as the bond guaranty insurance shall be in full force and effect, the Issuer and the Paying Agent/Registrar agree to comply with the following provisions: (a) If payment of principal or interest due on the Bonds has not been made to the Paying Agent/Registrar in time to pay the registered owners of the Bonds, the Paying Agent/Registrar or any registered owner to whom such payment is due shall so notify AMBAC Indemnity Corporation, a Wisconsin domiciled stock insurance company ("AMBAC Indemnity") by telephonic or telegraphic notice, subsequently confirmed in writing, or written notice by registered or certified mail. Such notice shall specify the amount of the anticipated deficiency, the Bonds to which such deficiency is applicable, and whether such Bonds will be deficient as to principal or interest, or both. AMBAC Indemnity, on the later of the date due for payment or within one business day after receipt of notice of nonpayment, will deposit sufficient money with the United States Trust Company of New York, as insurance trustee for AMBAC Indemnity or any successor insurance trustee (the "Insurance Trustee"). (b) The Paying Agent/Registrar shall, after giving notice to AMBAC Indemnity as provided in (a) above, make available to AMBAC Indemnity and, at AMBAC Indemnity's direction, to the Insurance Trustee, the registration books of the Issuer maintained by the Paying Agent/Registrar, and all records relating to the Funds and Accounts maintained under this Ordinance. (c) The Paying Agent/Registrar shall provide AMBAC Indemnity and the Insurance Trustee with a list of registered owners of Bonds entitled to receive principal or interest payments from AMBAC Indemnity under the terms of the municipal bond guaranty insurance policy issued by AMBAC Indemnity insuring the payment when due of the principal of and interest on the Bonds as provided therein (the "Municipal Bond Guaranty Insurance Policy"), and shall make arrangements with the Insurance Trustee (i) to mail checks or drafts to the registered owners of Bonds entitled to receive full or partial interest payments from AMBAC Indemnity and (ii) to pay principal upon Bonds surrendered to the Insurance Trustee by the registered owners of Bonds entitled to receive full or partial principal payments from AMBAC Indemnity. (d) The Paying Agent/Registrar shall, at the time it provides notice to AMBAC Indemnity pursuant to (a) above, notify registered owners of Bonds entitled to receive the payment of principal or interest thereon from AMBAC Indemnity (i) as to the fact of such entitlement; (ii) that AMBAC Indemnity will remit to them all or a part of the interest payments next coming due; (iii) that should they be entitled to receive full payment of principal from AMBAC Indemnity, they 14 005333 must present and surrender their Bonds together with any appropriate instrument of assignment for payment to the Insurance Trustee, and not the Paying Agent/Registrar; and (iv) that should they be entitled to receive partial payment of principal from AMBAC Indemnity, they must present and surrender their Bonds for payment thereon first to the Paying Agent/Registrar, who shall note on such Bonds the portion of the principal paid by the Paying Agent/Registrar, and then, along with an appropriate instrument of assignment, to the Insurance Trustee, which will then pay the unpaid portion of principal. The Insurance Trustee shall disburse to registered owners of Bonds, or the Paying Agent/Registrar, the payment due less any amount held by the Paying Agent/Registrar for payment of principal of or interest on Bonds and legally available therefor. (e) In the event that the Paying Agent/Registrar has notice that any payment of principal of or interest on a Bond which has become due for payment and which is made to a registered owner by or on behalf of the Issuer has been deemed a preferential transfer and theretofore recovered from its registered owner pursuant to the United States Bankruptcy Code by a trustee in bankruptcy in accordance with the final, nonappealable order of a court having competent jurisdiction, the Paying Agent/Registrar shall, at the time AMBAC Indemnity is notified pursuant to (a) above, notify all registered owners that in the event that any registered owner's payment is so recovered, such registered owner will be entitled to payment from AMBAC Indemnity to the extent of such recovery if sufficient funds are not otherwise available, and the Paying Agent/Registrar shall furnish to AMBAC Indemnity its records evidencing the payments of principal of and interest on the Bonds which have been made by the Paying Agent/Registrar and subsequently recovered from registered owners and the dates on which such payments were made. (f) In addition to those rights granted AMBAC Indemnity under this Ordinance, AMBAC Indemnity shall, upon remittance and transfer of Bonds or appropriate instruments of assignment, become the owner thereof, and to evidence such ownership (i) in the case of claims for past due interest, the Paying Agent/Registrar shall note AMBAC Indemnity right's as owner on the Registration Books upon receipt from AMBAC Indemnity of proof of the payment of interest thereon to the registered owners of the Bonds and (ii) in the case of claims for past due principal, the Paying Agent/Registrar shall note AMBAC Indemnity's rights as owner on the Registration Books upon surrender of the Bonds by the registered owners thereof together with proof of the payment of principal thereof. Section 8. DISPOSITION OF BOND PROCEEDS. The proceeds of the Bonds shall be placed into the Interest and Sinking Fund and the Redemption Fund of the Issuer as follows: n05334 15 (a) Interest and Sinking Fund. An amount equal to the accrued interest on the Bonds from the date of the Bonds to the date of delivery to the Initial Purchaser shall be deposited in the Interest and Sinking Fund. (b) Redemption Fund. The proceeds of the Bonds remaining after the above described deposit into the Interest and Sinking Fund shall be placed in the Redemption Fund (hereby created with a depository bank of the Issuer) to be used by the Issuer for the purpose of paying and retiring the Refunded Obligations, and, to the extent not otherwise provided for, to pay a portion of all expenses arising in connection with the issuance of the Bonds and the refunding of the Refunded Obligations. Section 9. REMEDIES OF OWNERS. In addition to all rights and remedies of any Owner of the Bonds provided by the laws of the State of Texas, the Issuer and the Council covenant and agree that in the event the Issuer defaults in the payment of the principal of or interest on any of the Bonds when due, fails to make the payments required by this Ordinance to be made into the Interest and Sinking Fund, or defaults in the observance or performance of any of the covenants, conditions, or obligations set forth in this Ordinance, the owner of any of the Bonds shall be entitled to a writ of mandamus issued by a court of proper jurisdiction compelling and requiring the Council and other officers of the Issuer to observe and perform any covenant, obligation, or condition prescribed in this Ordinance. No delay or omission by any owner to exercise any right or power accruing to such owner upon default shall impair any such right or power, or shall be construed to be a waiver of any such default or acquiescence therein, and every such right or power may be exercised from time to time and as often as may be deemed expedient. The specific remedies mentioned in this Ordinance shall be available to any owner of any of the Bonds and shall be cumulative of all other existing remedies. Section 10. DEFEASANCE OF BONDS. (a) Any Bond and the interest thereon shall be deemed to be paid, retired, and no longer outstanding (a "Defeased Bond") within the meaning of this Ordinance, except to the extent provided in subsection (d) of this Section 10, when payment of the principal of such Bond, plus interest thereon to the due date (whether such due date be by reason of maturity, upon redemption, or otherwise) either (i) shall have been made or caused to be made in accordance with the terms thereof (including the giving of any required notice of redemption) or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Paying Agent/Registrar for such payment (A) lawful money of the United States of America sufficient to make such payment or (B) Government Obligations (hereinafter defined) which mature as to principal and interest in such amounts and at such times as will insure the availability, without reinvestment, of sufficient money to provide for such 16 005335 payment, and when proper arrangements have been made by the Issuer with the Paying Agent/Registrar for the payment of its services until all Defeased Bonds shall have become due and payable. At such time as a Bond shall be deemed to be a Defeased Bond hereunder, as aforesaid, such Bond and the interest thereon shall no longer be secured by, payable from, or entitled to the benefits of, the ad valorem taxes herein levied and pledged as provided in this Ordinance, and such principal and interest shall be payable solely from such money or Government Obligations. (b) Any money so deposited with the Paying Agent/Regis- trar may at the written direction of the Issuer also be in- vested in Government Obligations, maturing in the amounts and times as hereinbefore set forth, and all income from such Government Obligations received by the Paying Agent/Registrar which is not required for the payment of the Bonds and interest thereon, with respect to which such money has been so depos- ited, shall be turned over to the Issuer, or deposited as directed in writing by the Issuer. (c) The term "Government Obligations" as used in this Section, shall mean direct obligations of the United States of America, including obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, which may be United States Treasury obligations such as its State and Local Government Series, which may be in book -entry form. (d) Until all Defeased Bonds shall have become due and payable, the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for such Defeased Bonds the same as if they had not been defeased, and the Issuer shall make proper arrangements to provide and pay for such services as required by this Ordinance. (e) In the event that the principal and/or interest due on the Bonds shall be paid by AMBAC Indemnity pursuant to the Municipal Bond Guaranty Insurance Policy, the Bonds shall remain outstanding for all purposes, not be defeased or otherwise satisfied, and not be considered paid by the Issuer, and the assignment and pledge of the proceeds of taxes and all covenants, agreements, and other obligations of the Issuer to the registered owners shall continue to exist and shall run to the benefit of AMBAC Indemnity, and AMBAC Indemnity shall be subrogated to the rights of such registered owners. Section 11. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROY- ED BONDS. (a) Replacement Bonds. In the event any outstand- ing Bond is damaged, mutilated, lost, stolen, or destroyed, the Paying Agent/Registrar shall cause to be printed, executed, and delivered, a new bond of the same principal amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or n05336 17 destroyed Bond, in replacement for such Bond in the manner hereinafter provided. (b) Application for Replacement Bonds. Application for replacement of damaged, mutilated, lost, stolen, or destroyed Bonds shall be made by the registered owner thereof to the Paying Agent/Registrar. In every case of loss, theft, or destruction of a Bond, the registered owner applying for a replacement bond shall furnish to the Issuer and to the Paying Agent/Registrar such security or indemnity as may be required by them to save each of them harmless from any loss or damage with respect thereto. Also, in every case of loss, theft, or destruction of a Bond, the registered owner shall furnish to the Issuer and to the Paying Agent/Registrar evidence to their satisfaction of the loss, theft, or destruction of such Bond, as the case may be. In every case of damage or mutilation of a Bond, the registered owner shall surrender to the Paying Agent/Registrar for cancellation the Bond so damaged or muti- lated. (c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the event any such Bond shall have matured, and no default has occurred which is then con- tinuing in the payment of the principal of, redemption premium, if any, or interest on the Bond, the Issuer may authorize the payment of the same (without surrender thereof except in the case of a damaged or mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished as above provided in this Section. (d) Charge for Issuing Replacement Bonds. Prior to the issuance of any replacement bond, the Paying Agent/Registrar shall charge the registered owner of such Bond with all legal, printing, and other expenses in connection therewith. Every replacement bond issued pursuant to the provisions of this Section by virtue of the fact that any Bond is lost, stolen, or destroyed shall constitute a contractual obligation of the Issuer whether or not the lost, stolen, or destroyed Bond shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Ordinance equally and proportionately with any and all other Bonds duly issued under this Ordinance. (e) Authority for Issuing Replacement Bonds. In accor- dance with Section 6 of Vernon's Ann. Tex. Civ. St. Art. 717k-6, this Section 11 of this Ordinance shall constitute authority for the issuance of any such replacement bond without necessity of further action by the governing body of the Issuer or any other body or person, and the duty of the replacement of such bonds is hereby authorized and imposed upon the Paying Agent/ Registrar, and the Paying Agent/Registrar shall authen- ticate and deliver such Bonds in the form and manner and with the effect, as provided in Section 4(a) of this Ordinance for Bonds issued in exchange for other Bonds. 18 n05337 Section 12. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND COUNSEL'S OPINION, AND CUSIP NUMBERS. The Mayor of the Issuer is hereby authorized to have control of the Bonds initially issued and delivered hereunder and all necessary records and proceedings pertaining to the Bonds pending their delivery and their investigation, examination, and approval by the Attorney General of the State of Texas, and their registra- tion by the Comptroller of Public Accounts of the State of Texas. Upon registration of the Bonds said Comptroller of Public Accounts (or a deputy designated in writing to act for said Comptroller) shall manually sign the Comptroller's Registration Certificate attached to such Bonds, and the seal of said Comptroller shall be impressed, or placed in facsimile, on such Certificate. The approving legal opinion of the McCall, Parkhurst & Horton, Bond Counsel and the assigned CUSIP numbers may, at the option of the Issuer, be printed on the Bonds issued and delivered under this Ordinance, but neither shall have any legal effect, and shall be solely for the convenience and information of the registered owners of the Bonds. Section 13. COVENANTS OF THE ISSUER. (a) General Covenants. The Issuer covenants and represents that: (i) The Issuer is a duly incorporated Home Rule City, having more than 5000 inhabitants, operating and existing under the Constitution and laws of the State of Texas, and is duly authorized under the laws of the State of Texas to create and issue the Bonds; all action on its part for the creation and issuance of the Bonds has been duly and effectively taken; and the Bonds in the hands of the Owners thereof are and will be valid and enforceable obligations of the Issuer in accordance with their terms; and (ii) The Bonds shall be ratably secured in such manner that no one Contractual Obligation shall have preference over other Bonds. (b) Specific Covenants. The Issuer covenants and repre- sents that, while the Bonds are outstanding and unpaid, it will: (i) Levy an ad valorem tax that will be sufficient to provide funds to pay the current interest on the Bonds and to provide the necessary sinking fund, all as describ- ed in this Ordinance; and (ii) Keep proper books of record and account in which full, true, and correct entries will be made of all dealings, activities, and transactions relating to the Funds created pursuant to this Ordinance, and all books, documents, and vouchers relating thereto shall at all 19 n05338 reasonable times be made available for inspection upon request from any Owner. (c) _Covenants Regarding Tax Exemption of Interest on the Bonds. The Issuer covenants to take any action to maintain, or refrain from any action which would adversely affect, the treatment of the Bonds as obligations described in section 103 of the Code, the interest on which is not includable in the "gross income" of the holder for purposes of federal income taxation. In furtherance thereof, the Issuer specifically covenants as follows: (i) To take any action to assure that no more than 10% of the proceeds of the Bonds (less amounts deposited to a reserve fund, if any) are used for any "private business use," as defined in section 141(b)(6) of the Code or, if more than 10% of the proceeds are so used, that amounts, whether or not received by the Issuer with respect to such private business use, do not under the terms of this Ordinance or any underlying arrangement, directly or indirectly, secure or provide for the payment of more than 10$ of the debt service on the Bonds, in contravention of section 141(b)(2) of the Code; (ii) To take any action to assure that in the event that the "private business use" described in subsection (i) hereof exceeds 5% of the proceeds of the Bonds (less amounts deposited into a reserve fund, if any), then the amount in excess of 5% is used for a "private business use" which is "related" and not "disproportionate," within the meaning of section 141(b)(3) of the Code, to the governmental use; (iii) To take any action to assure that no amount which is greater than the lesser of $5, 000, 000 or 5% of the proceeds of the Bonds (less amounts deposited into a reserve fund, if any) is directly or indirectly used to finance loans to persons, other than state or local governmental units, in contravention of section 141(c) of the Code; (iv) To refrain from taking any action which would otherwise result in the Bonds being treated as "private activity bonds" within the meaning of section 141(b) of the Code; (v) To refrain from taking any action that would result in the Bonds being "federally guaranteed" within the meaning of section 149(b) of the Code; (vi) To refrain from using any portion of the pro- ceeds of the Bonds, directly or indirectly, to acquire or to replace funds which were used, directly or indirectly, to acquire investment property (as defined in section n05339 20 148(b)(2) of the Code) which would produce a materially higher yield over the term of the Bonds, other than investment property acquired with -- (A) proceeds of the Bonds invested for a reasonable temporary period of three years or less, or in the case of a refunding a period of 30 days or less, until such proceeds are needed for the purpose for which the Bonds are issued, (B) amounts invested in a bona fide debt service fund, within the meaning of section 1.103-13(b)(12) of the Treasury Regulations, and (C) amounts deposited in any reasonably requir- ed reserve or replacement fund to the extent such amounts do not exceed 10% of the proceeds of the Bonds; (vii) To otherwise restrict the use of the proceeds of the Bonds or amounts treated as proceeds of the Bonds, as may be necessary, so that the Bonds do not otherwise contravene the requirements of section 148 of the Code (relating to arbitrage) and, to the extent applicable, section 149(d) of the Code (relating to advance refundings); (viii) To pay to the United States of America at least once during each five year period (beginning on the date of delivery of the Bonds) an amount that is at least equal to 90% of the "Excess Earnings," within the meaning of section 148(f) of the Code, and to pay to the United States of America, not later than 60 days after the Bonds have been paid in full, 100% of the amount then required to be paid as a result of Excess Earnings under section 148(f) of the Code; and (ix) To maintain such records as will enable the Issuer to fulfill its responsibilities under this Section and section 148 of the Code and to retain such records for at least six years following the final payment of princi- pal and interest on the Bonds. It is the understanding of the Issuer that the covenants contained herein are intended to assure compliance with the Code and any regulations or rulings promulgated by the U.S. Department of Treasury pursuant thereto. In the event that regulations or rulings are hereafter promulgated which modify or expand provisions of the Code, as applicable to the Bonds, the Issuer will not be required to comply with any covenant contained herein to the extent that such modification or expansion, in the opinion of nationally -recognized bond counsel, will not adversely affect the exemption of interest on the Bonds under section 103 of the Code. In the event that 005340 21 regulations or rulings are hereafter promulgated which impose additional requirements which are applicable to the Bonds, the Issuer agrees to comply with the additional requirements to the extent necessary, in the opinion of nationally recognized bond counsel, to preserve the exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In order to facilitate compliance with the above covenants (vii), (viii), and (ix), a "Rebate Fund" is hereby established by the Issuer for the sole benefit of the United States of America, and such Fund shall not be subject to the claim of any other person, including without limitation the Bondholders. The Rebate Fund is established for the additional purpose of compliance with section 148 of the Code. Section 14. DESIGNATION AS QUALIFIED TAX-EXEMPT BONDS. The Issuer hereby designates the Bonds as "qualified tax-exempt bonds" as defined in Section 265(b)(3) of the Internal Revenue Code of 1986 (the "Code"). In furtherance of such designation, the Issuer represents, covenants, and warrants that (a) during the calendar year 1988, the Issuer (including any subordinate entities) has not designated nor will it designate any tax-exempt obligation, which, when aggregated with the Bonds, will result in more than $10,000,000 of "qualified tax-exempt bonds" being issued; (b) the Issuer reasonably anticipates that the amount of tax-exempt obligations issued during the calendar year 1988 by the Issuer (or any subordinate entities) will not exceed $10,000,000; and (c) the Issuer will take such action or refrain from such action as necessary, and as more particularly set forth in Section 13 of this Ordinance, in order that the Bonds will not be considered "private activity bonds" within the meaning of Section 142 of the Code. Section 15. SALE OF BONDS. The Bonds are hereby sold and shall be delivered to Underwood, Neuhaus & Co., Inc. and MBank Capital Markets (the "Initial Purchasers") at a price of par plus interest thereon to date of delivery, pursuant to the terms and provisions of the Official Notice of Sale and other sale documents. It is hereby officially found, determined, and declared that the terms of this sale are the most advantageous reasonably obtainable. The Bonds shall initially be registered in the name of Underwood, Neuhaus & Co., Inc. The officers of the Issuer are hereby authorized and directed to execute and deliver such certificates, instructions, or other instruments as are required or necessary to accomplish the purposes of this Ordinance. Section 16. APPROVAL OF OFFICIAL STATEMENT. The Issuer hereby approves the form and content of the Official Statement relating to the Bonds, and any addenda, supplement, or amend- ment thereto and approves the distribution of such Official Statement in the reoffering of the Bonds by the Initial Purchasers in final form, with such changes therein or addi- tions thereto as the officer executing the same may deem 22 005341 advisable, such determination to be conclusively evidenced by his execution thereof. It is further officially found deter- mined and declared that the statements and representations contained in said Official Statement are true and correct in all material respects to the best knowledge and belief of the Council. Section 17. CONSIDERATIONS OF REFUNDING. The Council hereby finds that by refunding the Refunded Obligations the Issuer will (i) lower the annual debt service requirements with respect to its general tax obligations and (ii) restructure its debt service in a manner which will allow the issuance of additional bond issues without a tax rate increase or with a smaller increase than would otherwise be required, Section 18. NOTICE TO PAYING AGENT AND REGISTERED OWNERS AND PUBLICATION. The principal of and accrued interest on the Refunded Certificate of Obligation shall be paid on its maturity date with proceeds of the Bonds. The Refunded Contractual Obligations are hereby called for redemption on July 15, 1988, and First City National Bank of Houston, Houston, Texas, is hereby directed to make appropriate arrange- ments so that the principal of and accrued interest on such Refunded Contractual Obligations may be redeemed at said bank on the redemption date. Unless notice is waived by the owners thereof, a copy of the Notice of Prior Redemption, substantially in the form attached hereto as Exhibit A, shall be delivered to the paying agent bank for the Refunded Contractual Obligations and a copy of such Notice of Prior Redemption shall be mailed to the registered owner thereof, or otherwise given as provided in the appropriate order, resolution, or ordinance authorizing the called Refunded Contractual Obligations. Section 19. MATTERS RELATED TO REFUNDING. In order that the Issuer shall satisfy in a timely manner all of its obligations under this Ordinance, the Mayor and all other appropriate officers and agents of the Issuer are hereby authorized and directed to take all other actions that are reasonably necessary to provide for the refunding of the Refunded Obligations, including without limitation, executing and delivering on behalf of the Issuer all certificates, consents, receipts, requests, notices, and other documents as may be reasonably necessary to satisfy the Issuer's obligations under this Ordinance and to direct the transfer and application of funds of the Issuer consistent with the provisions of this Ordinance. Section 20. ORDINANCE A CONTRACT; AMENDMENTS. This Ordinance shall constitute a contract with the Owners, from time to time, of the Bonds, binding on the Issuer and its successors and assigns, and shall not be amended or repealed by the Issuer as long as any Bond remains outstanding except as permitted in this Section. The Issuer may, without the consent 23 005342 of or notice to any owners, amend, change, or modify this Ordinance as may be required (i) by the provisions hereof, (ii) in connection with the issuance of any additional bonds, (iii) for the purpose of curing any ambiguity, inconsistency, or formal defect or omission herein, or (iv) in connection with any other change which is not to the prejudice of the Owners. The Issuer may, with the written consent of the Owners of a majority in aggregate principal amount of Bonds then outstanding affected thereby, and the insurer of any Bonds amend, change, modify, or rescind any provisions of this Ordinance; provided that without the consent of all of the Owners affected, no such amendment, change, modification, or rescission shall (i) extend the time or times of payment of the principal of and interest on the Bonds, reduce the principal amount thereof to the rate of interest thereon, or in any other way modify the terms of payment of the principal of or interest on additional bonds on a parity with the lien of the Bonds, (ii) give any preference of any Bond over any other Bond, (iii) extend any waiver of default to subsequent defaults, or (iv) reduce the aggregate principal amount of Bonds required for consent to any such amendment, change, modification, or rescission. Whenever the Issuer shall desire to make any amendment or addition to or rescission of this Ordinance requiring consent of the Owners, the Issuer shall cause notice of the amendment, addition, or rescission to be given as described above for a notice of redemption. Whenever at any time within one year after the date of the giving of such notice, the Issuer shall receive an instrument or instruments in writing executed by the Owners of a majority in aggregate principal amount of the Bonds then outstanding affected by any such amendment, addition, or rescission requiring the consent of Owners of Bonds, which instrument or instruments shall refer to the proposed amendment, addition, or rescission described in such notice and shall specifically consent to and approve the adoption thereof in substantially the form of the copy thereof referred to in such notice, thereupon, but not otherwise, the Issuer may adopt such amendment, addition, or rescission in substantially such form, except as herein provided. No Owner may thereafter object to the adoption of such amendment, addition, or rescission, or to any of the provisions thereof, and such amendment, addition, or rescission shall be fully effective for all purposes. Section 21. MISCELLANEOUS. (a) Titles Not Restrictive. The titles assigned to the various sections of this Ordinance are for convenience only and shall not be considered restrictive of the subject matter of any section or of any part of this Ordinance. (b) Inconsistent Provisions. All ordinances, orders, and resolutions, or parts thereof, which are in conflict or inconsistent with any provision of this Ordinance are hereby repealed and declared to be inapplicable, and the provisions of 24 n05343 this Ordinance shall be and remain controlling as to the matters prescribed herein. (c) Severability. If any word, phrase, clause, paragraph, sentence, part, portion, or provision of this Ordinance or the application thereof to any person or circumstances shall be held to be invalid, the remainder of this Ordinance shall nevertheless be valid and the Council hereby declares that this Ordinance would have been enacted without such invalid word, phrase, clause, paragraph, sentence, part, portion, or provisions. (d) Governing Law. This Ordinance shall be construed and enforced in accordance with the laws of the State of Texas. (e) Effective Date. This Ordinance shall take effect and be in full force and effect from and after the date of its passage, and it is so ordained. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF COLLEGE STATION, TEXAS this 15th day of June, 1988, at which meeting a quorum was present. ATTEST: Mayor, o y f eg ation, Texas i ecru , City of College St , Texas n05344 25 EXHIBIT A NOTICE OF REDEMPTION CITY OF COLLEGE STATION, TEXAS, PUBLIC PROPERTY FINANCE CONTRACTUAL OBLIGATIONS, SERIES 1988 DATED MAY 15, 1988 NOTICE IS HEREBY GIVEN that the City of College Station (the "Issuer"), acting through its City Council, has called for optional redemption the above described Obligations on July 15, 1988 at a redemption price equal to the principal amount thereof, plus unpaid accrued interest to the date fixed for redemption, without premium. Such redemption shall take place at the corporate trust offices of First City National Bank of Houston, Houston, Texas, on or before 10:00 a.m. on such date. THIS NOTICE IS GIVEN pursuant to the option of redemption reserved by the Issuer in the Ordinance authorizing the Obligations and shall be sent by certified mail postmarked at least ten days prior to July 15, 1988 and addressed to First City National Bank of Houston, Houston, Texas, as the Registered Owner of the Obligations. WHEN DUE PROVISION has been made to redeem these Obligations, the Obligations shall be payable solely from the funds provided for redemption, and interest would otherwise accrue shall terminate on July 15, 1988. WITNESS MY HAND this CITY OF COLLEGE STATION, TEXAS By �1 mlwbr n05345