ORD 1994-24 - C.O. Series 1994 Certificate of Obligation 08-16-1994ORDINANCE NO.
94 -24
AN ORDINANCE authorizing the issuance of "CITY OF
HUNTSVILLE, TEXAS, TAX AND HOTEL OCCUPANCY TAX
SURPLUS REVENUE CERTIFICATES OF OBLIGATION,
SERIES 1994 "; providing for the payment of said
certificates of obligation by the levy of an ad
valorem tax upon all taxable property within the
City and a pledge of a portion of the revenues
received from the hotel occupancy tax levied by the
City; providing the terms and conditions of such
certificates and resolving other matters incident
and relating to the issuance, payment, security,
sale and delivery of said certificates, including
the approval and execution of a Paying
Agent /Registrar Agreement and a Purchase Contract
and the approval and distribution of an Official
Statement pertaining thereto; and providing an
effective date.
WHEREAS, the City Council of the City of Huntsville, Texas,
has heretofore determined that certificates of obligation should
be issued in the maximum principal amount of $500,000 for the
purpose of paying contractual obligations to be incurred for (i)
the construction of a tourist and visitor's center honoring Sam
Houston and the history of the State of Texas and (ii)
professional services rendered in relation to such project and the
financing thereof; and
WHEREAS, a "Notice of Intention to Issue City of
Huntsville, Texas, Certificates of Obligation" was duly published
in the Huntsville Item , a newspaper hereby found
and determined to be of general circulation in the City of
Huntsville, Texas, on July 28, , 1994 and August 4,
1994, the date of the first publication of such notice being not
less than fifteen (15) days prior to the tentative date stated
therein for the passage and adoption of this Ordinance; and
WHEREAS,
certificates of
of at least 5%
presented to or
official of the
this Ordinance;
no petition protesting the issuance of such
obligation and bearing valid petition signatures
of the qualified electors of the City, has been
filed with the Mayor, City Secretary or any other
City on or prior to the date of the passage of
and
WHEREAS, the Council hereby finds and determines that all
of the certificates of obligation described in such notice should
be issued and sold at this time; now, therefore,
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
HUNTSVILLE, TEXAS:
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SECTION 1: Authorization, Designation. Principal Amount,
Purpose. Certificates of obligation of the City shall be and are
hereby authorized to be issued in the aggregate principal amount
of $500,000, to be designated and bear the title "CITY OF
HUNTSVILLE, TEXAS, TAX AND HOTEL OCCUPANCY TAX SURPLUS REVENUE
CERTIFICATES OF OBLIGATION, SERIES 1994" (hereinafter referred to
as the "Certificates"), for the purpose of paying contractual
obligations to be incurred for (i) the construction of a tourist
and visitor's center honoring Sam Houston and the history of the
State of Texas and (ii) professional services rendered in relation
to such project and the financing thereof, pursuant to authority
conferred by and in conformity with the Constitution and laws of
the State of Texas, including V.T.C.A., Local Government Code,
Subchapter C of Chapter 271, as amended.
SECTION 2: Fully Registered Obligations, - Authorized
Denominations, - Stated Maturities. - Interest Rates, - Date.
The Certificates are issuable in fully registered form only; shall
be dated August 15, 1994 (the "Certificate Date") and shall be in
denominations of $5,000 or any integral multiple thereof (within
a Stated Maturity) and the Certificates shall become due and
payable on August 15 in each of the years and in principal amounts
(the "Stated Maturities") and bear interest at per annum rates in
accordance with the following schedule:
Year of
Stated Maturity
Principal Interest
Amount Rate
1995 $ 35,000 4.20%
1996 40,000 4.70%
1997 45,000 5.00%
1998 45,000 5.10%
1999 50,000 5.30%
2000 50,000 5.40%
2001 55,000 5.60%
2002 55,000 5.75%
2003 60,000 5.90%
2004 65,000 6.00%
The Certificates shall bear interest on the unpaid principal
amounts from the Certificate Date at the rate per annum shown
above in this Section (calculated on the basis of a 360-day year
of twelve 30-day months). Interest on the Certificates shall be
payable on February 15 and August 15 of each year, commencing
February 15, 1995.
SECTION 3: Terms of Payment-Paving Agent/Registrar. The
principal of, premium, if any, and the interest on the
Certificates, due and payable by reason of maturity, redemption or
otherwise, shall be payable only to the registered owners or
holders of the Certificates (hereinafter called the "Holders")
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appearing on the registration and transfer books maintained by the
Paying Agent /Registrar and the payment thereof shall be in any
coin or currency of the United States of America, which at the
time of payment is legal tender for the payment of public and
private debts, and shall be without exchange or collection charges
to the Holders.
The selection and appointment of U. S. Trust Company of
Texas, N.A. to serve as Paying Agent /Registrar for the
Certificates is hereby approved and confirmed. Books and records
relating to the registration, payment, transfer and exchange of
the Certificates (the "Security Register ") shall at all times be
kept and maintained on behalf of the City by the Paying
Agent /Registrar, as provided herein and in accordance with the
terms and provisions of a "Paying Agent /Registrar Agreement ",
substantially in the form attached hereto as Exhibit A, and such
reasonable rules and regulations as the Paying Agent /Registrar and
the City may prescribe. The Mayor and City Secretary are
authorized to execute and deliver such Agreement in connection
with the delivery of the Certificates. The City covenants to
maintain and provide a Paying Agent /Registrar at all times until
the Certificates are paid and discharged, and any successor Paying
Agent /Registrar shall be a bank, trust company, financial
institution or other entity qualified and authorized to serve in
such capacity and perform the duties and services of Paying
Agent /Registrar. Upon any change in the Paying Agent /Registrar
for the Certificates, the City agrees to promptly cause a written
notice thereof to be sent to each Holder by United States Mail,
first class postage prepaid, which notice shall also give the
address of the new Paying Agent /Registrar.
Principal of and premium, if any, on the Certificates, shall
be payable at the Stated Maturities or redemption thereof only
upon presentation and surrender of the Certificates to the Paying
Agent /Registrar at its designated offices in New York, New York
(the "Designated Payment /Transfer Office "). Interest on the
Certificates shall be paid to the Holders whose names appear in
the Security Register at the close of business on the Record Date
(the last business day of the month next preceding each interest
payment date) and shall be paid by the Paying Agent/ Registrar
(i)by check sent United States Mail, first class postage prepaid,
to the address of the Holder recorded in the Security Register
or (ii) by such other method, acceptable to the Paying
Agent /Registrar, requested by, and at the risk and expense of, the
Holder. If the date for the payment of the principal of or
interest on the Certificates shall be a Saturday, Sunday, a legal
holiday, or a day when banking institutions in the City where the
Paying Agent /Registrar is located are authorized by law or
executive order to close, then the date for such payment shall be
the next succeeding day which is not such a Saturday, Sunday,
legal holiday, or day when banking institutions are authorized to
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close; and payment on such date shall have the same force and
effect as if made on the original date payment was due.
In the event of a non - payment of interest on a scheduled
payment date, and for thirty (30) days thereafter, a new record
date for such interest payment (a "Special Record Date ") will be
established by the Paying Agent/ Registrar, if and when funds for
the payment of such interest have been received. Notice of the
Special Record Date and of the scheduled payment date of the past
due interest (which shall be 15 days after the Special Record
Date) shall be sent at least five (5) business days prior to the
Special Record Date by United States Mail, first class postage
prepaid, to the address of each Holder appearing on the Security
Register at the close of business on the last business day next
preceding the date of mailing of such notice.
SECTION 4: Redemption. (a) Optional Redemption. The
Certificates having Stated Maturities on and after August 15,
2002, shall be subject to redemption prior to maturity, at the
option of the City, in whole or in part in principal amounts of
$5,000 or any integral multiple thereof (and if within a Stated
Maturity by lot by the Paying Agent /Registrar), on August 15, 2001
or on any date thereafter at the redemption price of par plus
accrued interest to the date of redemption.
(b) Exercise of Redemption Option. At least forty -five (45)
days prior to a redemption date for the Certificates (unless a
shorter notification period shall be satisfactory to the Paying
Agent /Registrar), the City shall notify the Paying Agent /Registrar
of the decision to redeem Certificates, the principal amount of
each Stated Maturity to be redeemed, and the date of redemption
therefor. The decision of the City to exercise the right to
redeem Certificates shall be entered in the minutes of the
governing body of the City.
(c) Selection of Certificates for Redemption. If less than
all Outstanding Certificates of the same Stated Maturity are to be
redeemed on a redemption date, the Paying Agent/ Registrar shall
treat such Certificates as representing the number of Certificates
Outstanding which is obtained by dividing the principal amount of
such Certificates by $5,000 and shall select the Certificates to
be redeemed within such Stated Maturity by lot.
(d) Notice of Redemption. Not less than thirty (30) days
prior to a redemption date for the Certificates, a notice of
redemption shall be sent by United States Mail, first class
postage prepaid, in the name of the City and at the City's
expense, to each Holder of a Certificate to be redeemed in whole
or in part at the address of the Holder appearing on the Security
Register at the close of business on the business day next
preceding the date of mailing such notice, and any notice of
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redemption so mailed shall be conclusively presumed to have been
duly given irrespective of whether received by the Holder.
All notices of redemption shall (i) specify the date of
redemption for the Certificates, (ii) identify the Certificates to
be redeemed and, in the case of a portion of the principal amount
to be redeemed, the principal amount thereof to be
redeemed, (iii) state the redemption price, (iv) state that the
Certificates, or the portion of the principal amount thereof to be
redeemed, shall become due and payable on the redemption date
specified, and the interest thereon, or on the portion of the
principal amount thereof to be redeemed, shall cease to accrue
from and after the redemption date, and (v) specify that payment
of the redemption price for the Certificates, or the principal
amount thereof to be redeemed, shall be made at the Designated
Payment/Transfer Office of the Paying Agent/Registrar only upon
presentation and surrender of the Certificates. If a Certificate
is subject by its terms to prior redemption and has been called
for redemption and notice of redemption has been duly given as
hereinabove provided, such Certificate (or the principal amount
thereof to be redeemed) shall become due and payable and interest
thereon shall cease to accrue from and after the redemption date
therefor; provided moneys sufficient for the payment of such
Certificate (or of the principal amount thereof to be redeemed) at
the then applicable redemption price are held for the purpose of
such payment by the Paying Agent/Registrar.
SECTION 5: Reaistration - Transfer - Exchange of
Certificates - Predecessor Certificates. The Paying
Agent/Registrar shall obtain, record and maintain in the Security
Register the name and address of each and every owner of the
Certificates issued under and pursuant to the provisions of this
Ordinance or if appropriate the nominee thereof. Any Certificate
may be transferred or exchanged for Certificates of other
authorized denominations by the Holder, in person or by his duly
authorized agent, upon surrender of such Certificate to the Paying
Agent/Registrar for cancellation, accompanied by a written
instrument of transfer or request for exchange duly executed by
the Holder or by his duly authorized agent, in form satisfactory
to the Paying Agent/Registrar.
Upon surrender of any Certificate for transfer at the
Designated Payment/Transfer Office of the Paying Agent/Registrar,
the Paying Agent/Registrar shall register and deliver, in the name
of the designated transferee or transferees, one or more new
Certificates, executed on behalf of, and furnished by, the City,
of authorized denominations and having the same Stated Maturity
and of a like aggregate principal amount as the Certificate or
Certificates surrendered for transfer.
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At the option of the Holders, Certificates may be exchanged
for other Certificates of authorized denominations and having the
same Stated Maturity, bearing the same rate of interest and of
like aggregate principal amount as the Certificates surrendered
for exchange upon surrender of the Certificates to be exchanged at
the Designated Payment /Transfer Office of the Paying
Agent /Registrar. Whenever any Certificates are so surrendered for
exchange, the Paying Agent /Registrar shall register and deliver
new Certificates, executed on behalf of, and furnished by the
City, to the Holder requesting the exchange.
All Certificates issued upon any transfer or exchange of
Certificates shall be delivered at the Designated Payment /Transfer
Office of the Paying Agent /Registrar, or sent by United States
mail, first class postage prepaid, to the Holder and, upon the
delivery thereof, the same shall be valid obligations of the City,
evidencing the same obligation to pay, and entitled to the same
benefits under this Ordinance, as the Certificates surrendered in
such transfer or exchange.
All transfers or exchanges of Certificates pursuant to this
Section shall be made without expense or service charge to the
Holder, except as otherwise herein provided, and except that the
Paying Agent /Registrar shall require payment by the Holder
requesting such transfer or exchange of any tax or other
governmental charges required to be paid with respect to such
transfer or exchange.
Certificates cancelled by reason of an exchange or transfer
pursuant to the provisions hereof are hereby defined to be
"Predecessor Certificates," evidencing all or a portion, as the
case may be, of the same obligation to pay evidenced by the new
Certificate or Certificates registered and delivered in the
exchange or transfer therefor. Additionally, the term
"Predecessor Certificates" shall include any mutilated, lost,
destroyed, or stolen Certificate for which a replacement
Certificate has been issued, registered and delivered in lieu
thereof pursuant to Section 25 hereof and such new replacement
Certificate shall be deemed to evidence the same obligation as the
mutilated, lost, destroyed, or stolen Certificate.
Neither the City nor the Paying Agent/ Registrar shall be
required to issue or transfer to an assignee of a Holder any
Certificate called for redemption, in whole or in part, within 45
days of the date fixed for the redemption of such Certificate;
provided, however, such limitation on transferability shall not be
applicable to an exchange by the Holder of the unredeemed balance
of a Certificate called for redemption in part.
SECTION 6: Book -Entry Only Transfers and Transactions.
Notwithstanding the provisions contained in Sections 3, 4 and 5
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hereof relating to the payment and transfer /exchange of the
Certificates, the City hereby approves and authorizes the use of
"Book -Entry Only" securities clearance, settlement and transfer
system provided by The Depository Trust Company (DTC), a limited
purpose trust company organized under the laws of the State of New
York, in accordance with the requirements and procedures
identified in the Letter of Representation by and between the
City, the Paying Agent /Registrar and DTC (the "Depository
Agreement ") relating to the Certificates.
Pursuant to the Depository Agreement and the rules of DTC,
the Certificates shall be deposited with DTC who shall hold said
Certificates for its participants (the "DTC Participants ") and,
while the Certificates are held by DTC under the Depository
Agreement, the Holder of the Certificates on the Security Register
for all purposes, including payment and notices, shall be Cede &
Co., as nominee of DTC, notwithstanding the ownership of each
actual purchaser or owner of each Certificate (the "Beneficial
Owners ") being recorded in the records of DTC and DTC
Participants.
In the event DTC determines to discontinue serving as
securities depository for the Certificates or otherwise ceases to
provide book -entry clearance and settlement of securities
transactions in general or the City determines that DTC is
incapable of properly discharging its duties as securities
depository for the Certificates, the City covenants and agrees
with the Holders of the Certificates to cause Certificates to be
printed in definitive form and provide for the Certificate
certificates to be issued and delivered to DTC Participants and
Beneficial Owners, as the case may be. Thereafter, the
Certificates in definitive form shall be assigned, transferred and
exchanged on the Security Register maintained by the Paying
Agent /Registrar and payment of such Certificates shall be made in
accordance with the provisions of Sections 3, 4 and 5 hereof.
SECTION 7: Execution - Registration. The Certificates
shall be executed on behalf of the City by the Mayor under its
seal reproduced or impressed thereon and countersigned by the City
Secretary. The signature of said officers on the Certificates may
be manual or facsimile. Certificates bearing the manual or
facsimile signatures of said individuals who are or were the
proper officers of the City on the Certificate Date shall be
deemed to be duly executed on behalf of the City, notwithstanding
that such individuals or any of them shall cease to hold such
offices prior to the delivery of the Certificates to the initial
purchaser(s), and with respect to Certificates delivered in
subsequent exchanges and transfers, all as authorized and provided
in the Bond Procedures Act of 1981, as amended.
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No Certificate shall be entitled to any right or benefit
under this Ordinance, or be valid or obligatory for any purpose,
unless there appears on such Certificate either a certificate of
registration substantially in the form provided in Section 9C,
manually executed by the Comptroller of Public Accounts of the
State of Texas or his duly authorized agent, or a certificate of
registration substantially in the form provided in Section 9D,
manually executed by an authorized officer, employee or
representative of the Paying Agent /Registrar, and either such
certificate upon any Certificate shall be conclusive evidence, and
the only evidence, that such Certificate has been duly certified,
registered and delivered.
SECTION 8: Initial Certificate(s). The Certificates herein
authorized shall be initially issued either (i) as a single fully
registered certificate in the total principal amount of $500,000
with principal installments to become due and payable as provided
in Section 2 hereof and numbered T -1, or (ii) as ten (10) fully
registered certificates, being one certificate for each year of
maturity in the applicable principal amount and denomination and
to be numbered consecutively from T -1 and upward (hereinafter
called the "Initial Certificate(s)") and, in either case, the
Initial Certificate(s) shall be registered in the name of the
initial purchaser(s) or the designee thereof. The Initial
Certificate(s) shall be the Certificates submitted to the Office
of the Attorney General of the State of Texas for approval,
certified and registered by the Office of the Comptroller of
Public Accounts of the State of Texas and delivered to the initial
purchaser(s). Any time after the delivery of the Initial
Certificate(s), the Paying Agent /Registrar, pursuant to written
instructions from the initial purchaser(s), or the designee
thereof, shall cancel the Initial Certificate(s) delivered
hereunder and exchange therefor definitive Certificates of
authorized denominations, Stated Maturities, principal amounts and
bearing applicable interest rates for transfer and delivery to the
Holders named at the addresses identified therefor; all pursuant
to and in accordance with such written instructions from the
initial purchaser(s), or the designee thereof, and such other
information and documentation as the Paying Agent /Registrar may
reasonably require.
SECTION 9: Forms. A. Forms Generally. The
Certificates, and the Registration Certificate of the Comptroller
of Public Accounts of the State of Texas, the Registration
Certificate of Paying Agent /Registrar, and the form of Assignment
to be printed on the Certificates, shall be substantially in the
forms set forth in this Section with such appropriate insertions,
omissions, substitutions, and other variations as are permitted or
required by this Ordinance and may have such letters, numbers, or
other marks of identification (including identifying numbers and
letters of the Committee on Uniform Securities Identification
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Procedures of the American Bankers Association) and such legends
and endorsements (including insurance legends in the event the
Certificates, or any maturities thereof, are purchased with
insurance and any reproduction of an opinion of counsel) thereon
as may, consistently herewith, be established by the City or
determined by the officers executing such Certificates as
evidenced by their execution thereof. Any portion of the text of
any Certificates may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Certificate.
The Certificates, including the Initial Certificate(s), shall
be typewritten, printed, lithographed, or photocopied, or produced
in any other similar manner, all as determined by the officers
executing such Certificates as evidenced by their execution.
B. Form of Definitive Certificate.
REGISTERED REGISTERED
NO. $
UNITED STATES
STATE OF
CITY OF HUNTSVILLE, TEXAS,
TAX SURPLUS
CERTIFICATE OF
SERIES
OF AMERICA
TEXAS
TAX AND HOTEL OCCUPANCY
REVENUE
OBLIGATION,
1994
Certificate Date: Interest Rate:
August 15, 1994
Registered Owner:
Stated Maturity CUSIP NO:
Principal Amount: Dollars
The City of Huntsville (hereinafter referred to as the
"City "), a body corporate and municipal corporation in the County
of Walker, State of Texas, for value received, acknowledges itself
indebted to and hereby promises to pay to the order of the
Registered Owner named above, or the registered assigns thereof,
on the Stated Maturity date specified above the Principal Amount
stated above (or so much thereof as shall not have been paid upon
prior redemption) and to pay interest on the unpaid principal
amount hereof from the Certificate Date at the per annum rate of
interest specified above computed on the basis of a 360 -day year
of twelve 30 -day months; such interest being payable on
February 15 and August 15 of each year, commencing February 15,
1995. Principal of this Certificate is payable at its Stated
Maturity or redemption to the registered owner hereof upon
presentation and surrender at the Designated Payment /Transfer
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Office of the Paying Agent /Registrar executing the registration
certificate appearing hereon, or its successor. Interest is
payable to the registered owner of this Certificate (or one or
more Predecessor Certificates, as defined in the Ordinance
hereinafter referenced) whose name appears on the "Security
Register" maintained by the Paying Agent/ Registrar at the close
of business on the "Record Date ", which is the last business day
of the month next preceding each interest payment date and
interest shall be paid by the Paying Agent /Registrar by check sent
United States Mail, first class postage prepaid, to the address of
the registered owner recorded in the Security Register or by such
other method, acceptable to the Paying Agent/ Registrar, requested
by, and at the risk and expense of, the registered owner. All
payments of principal of, premium, if any, and interest on this
Certificate shall be without exchange or collection charges to the
owner hereof and in any coin or currency of the United States of
America which at the time of payment is legal tender for the
payment of public and private debts.
This Certificate is one of the series specified in its title
issued in the aggregate principal amount of $500,000 (herein
referred to as the "Certificates ") for the purpose of paying
contractual obligations to be incurred for (i) the construction of
a tourist and visitor's center honoring Sam Houston and the
history of the State of Texas and (ii) professional services
rendered in relation to such project and the financing thereof,
under and in strict conformity with the Constitution and laws of
the State of Texas, particularly V.T.C.A., Local Government Code,
Subchapter C of Chapter 271, as amended, and pursuant to an
ordinance adopted by the governing body of the City (hereinafter
referred to as the "Ordinance ").
The Certificates maturing on and after August 15, 2002, may
be redeemed prior to their Stated Maturities, at the option of the
City, in whole or in part in principal amounts of $5,000 or any
integral multiple thereof (and if within a Stated Maturity by lot
by the Paying Agent /Registrar), on August 15, 2001, or on any date
thereafter, at the redemption price of par, together with accrued
interest to the date of redemption and upon 30 days prior written
notice being sent by United States Mail, first class postage
prepaid, to the registered owners of the Certificates to be
redeemed, and subject to the terms and provisions relating thereto
contained in the Ordinance. If this Certificate (or any portion
of the principal sum hereof) shall have been duly called for
redemption and notice of such redemption duly given, then upon
such redemption date this Certificate (or the portion of the
principal sum hereof to be redeemed) shall become due and payable,
and interest thereon shall cease to accrue from and after the
redemption date therefor, provided moneys for the payment of the
redemption price and the interest on the principal amount to be
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redeemed to the date of redemption are held for the purpose of
such payment by the Paying Agent /Registrar.
In the event of a partial redemption of the principal amount
of this Certificate, payment of the redemption price of such
principal amount shall be made to the registered owner only upon
presentation and surrender of this Certificate to the Designated
Payment /Transfer Office of the Paying Agent /Registrar, and there
shall be issued to the registered owner hereof, without charge, a
new Certificate or Certificates of like maturity and interest rate
in any authorized denominations provided by the Ordinance for the
then unredeemed balance of the principal sum hereof. If this
Certificate is selected for redemption, in whole or in part, the
City and the Paying Agent /Registrar shall not be required to
transfer this Certificate to an assignee of the registered owner
within 45 days of the redemption date therefor; provided, however,
such limitation on transferability shall not be applicable to an
exchange by the registered owner of the unredeemed balance hereof
in the event of its redemption in part.
The Certificates are payable from the proceeds of an ad .
valorem tax levied, within the limitations prescribed by law, upon
all taxable property in the City and are additionally payable from
a pledge of a portion of the revenues received from a Hotel
Occupancy Tax levied by the City, such pledge, however, being
junior and subordinate to the pledge of the Hotel Occupancy Tax
securing the payment of "Prior Lien Obligations" (defined in the
Ordinance) hereafter issued by the City. In the Ordinance, the
City reserves and retains the right to issue Prior Lien
Obligations while the Certificates are outstanding without
limitation as to principal amount but subject to any terms,
conditions or restrictions as may be applicable thereto under law
or otherwise.
Reference is hereby made to the Ordinance, a copy of which is
on file in the Designated Payment /Transfer Office of the Paying
Agent /Registrar, and to all the provisions of which the Holder by
the acceptance hereof hereby assents, for definitions of terms;
the description of and the nature and extent of the ad valorem tax
levied for the payment of the Certificates; a description of the
Hotel Occupancy Tax levied by the City and the portion thereof
pledged to the payment of the principal of and interest on the
Certificates; the nature and extent and manner of enforcement of
the pledge; the terms and conditions relating to the transfer or
exchange of this Certificate; the conditions upon which the
Ordinance may be amended or supplemented with or without the
consent of the Holders; the rights, duties, and obligations of the
City and the Paying Agent /Registrar; the terms and provisions upon
which the tax levy and the liens, pledges, charges and covenants
made therein may be discharged at or prior to the maturity of this
Certificate, and this Certificate deemed to be no longer
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Outstanding thereunder; and for the other terms and provisions
contained therein. Capitalized terms used herein have the
meanings assigned in the Ordinance.
This Certificate, subject to certain limitations contained in
the Ordinance, may be transferred on the Security Register only
upon its presentation and surrender at the Designated
Payment /Transfer Office of the Paying Agent /Registrar, with the
Assignment hereon duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Paying
Agent /Registrar duly executed by, the registered owner hereof, or
his duly authorized agent. When a transfer on the Security
Register occurs, one or more new fully registered Certificates of
the same Stated Maturity, of authorized denominations, bearing the
same rate of interest, and of the same aggregate principal amount
will be issued by the Paying Agent /Registrar to the designated
transferee or transferees.
The City and the Paying Agent /Registrar, and any agent of
either, may treat the registered owner hereof whose name appears
on the Security Register (i) on the Record Date as the owner
entitled to payment of interest hereon, (ii) on the date of
surrender of this Certificate as the owner entitled to payment of
principal hereof at its Stated Maturity or its redemption, in
whole or in part, and (iii) on any other date as the owner for all
other purposes, and neither the City nor the Paying
Agent /Registrar, or any agent of either, shall be affected by
notice to the contrary. In the event of a non - payment of interest
on a scheduled payment date, and for thirty (30) days thereafter,
a new record date for such interest payment (a "Special Record
Date ") will be established by the Paying Agent/ Registrar, if and
when funds for the payment of such interest have been received.
Notice of the Special Record Date and of the scheduled payment
date of the past due interest (which shall be 15 days after the
Special Record Date) shall be sent at least five (5) business days
prior to the Special Record Date by United States Mail, first
class postage prepaid, to the address of each Holder appearing on
the Security Register at the close of business on the last
business day next preceding the date of mailing of such notice.
It is hereby certified, recited, represented and covenanted
that the City is duly organized and legally incorporated under and
by virtue of the Constitution and laws of the State of Texas; that
the issuance of the Certificates is duly authorized by law; that
all acts, conditions and things required to exist and be done
precedent to and in the issuance of the Certificates to render the
same lawful and valid obligations of the City have been properly
done, have happened and have been performed in regular and due
time, form and manner as required by the Constitution and laws of
the State of Texas, and the Ordinance; that the Certificates do
not exceed any constitutional or statutory limitation; and that
0188562
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due provision has been made for the payment of the principal of
and interest on the Certificates by the levy of an ad valorem tax
and a pledge of a portion of the Hotel Occupancy Tax levied by the
City as aforestated. In case any provision in this Certificate or
any application thereof shall be invalid, illegal, or
unenforceable, the validity, legality, and enforceability of the
remaining provisions and applications shall not in any way be
affected or impaired thereby. The terms and provisions of this
Certificate and the Ordinance shall be construed in accordance
with and shall be governed by the laws of the State of Texas.
IN WITNESS WHEREOF, the City Council of the City has caused
this Certificate to be duly executed under the official seal of
the City as of the Certificate Date.
CITY OF HUNTSVILLE, TEXAS
COUNTERSIGNED: Mayor
City Secretary
(CITY SEAL)
C. *Form of Registration Certificate of Comptroller of Public
Accounts to appear on Initial Certificate(s) only.
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER
OF PUBLIC ACCOUNTS
THE STATE OF TEXAS
( REGISTER NO.
(
I HEREBY CERTIFY that this Certificate has been examined,
certified as to validity and approved by the Attorney General of
the State of Texas and duly registered by the Comptroller of
Public Accounts of the State of Texas.
WITNESS my signature and seal of office this
•
Comptroller of Public Accounts
of the State of Texas
(SEAL)
*NOTE TO PRINTER: not to appear on definitive certificates.
0188562
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D. Form of Certificate of Paving Agent /Registrar to appear on
Definitive Certificates onlv.
REGISTRATION CERTIFICATE OF PAYING AGENT /REGISTRAR
This Certificate has been duly issued and registered under
the provisions of the within mentioned Ordinance; the certificate
or certificates of the above entitled and designated series
originally delivered having been approved by the Attorney General
of the State of Texas and registered by the Comptroller of Public
Accounts, as shown by the records of the Paying Agent /Registrar.
The designated offices of the Paying Agent /Registrar in New
York, New York, is the Designated Payment /Transfer Office for this
Bond.
Registration Date:
E. Form of Assignment
U. S. TRUST COMPANY OF TEXAS, N.A.
as Paying Agent /Registrar
By
Authorized Signature
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns, and
transfers unto (Print or typewrite name, address, and zip code
transferee:)
(Social Security or other identifying number:
the within Certificate and all rights
thereunder, and hereby irrevocably constitutes and appoints
attorney to transfer the within Certificate on the books kept for
registration thereof, with full power of substitution in the
premises.
DATED:
Signature guaranteed:
0188562
NOTICE: The signature on this
assignment must correspond with
the name of the registered owner
as it appears on the face of the
within Certificate in every
particular.
-14-
F. The Initial Certificate(s1 shall be in the form set forth
in paragraph B of this Section, except that the form of
a single fully registered Initial Certificate shall be
modified as follows:
(i) immediately under the name of the certificate the
headings "Interest Rate " and "Stated Maturity
" shall both be omitted;
(ii) paragraph one shall read as follows:
Registered Owner:
Principal Amount: Dollars
The City of Huntsville (hereinafter referred to as the
"City "), a body corporate and municipal corporation in the County
of Walker, State of Texas, for value received, acknowledges itself
indebted to and hereby promises to pay to the order of the
Registered Owner named above, or the registered assigns thereof,
the above stated Principal Amount on August 15 in each of the
years and in principal installments in accordance with the
following schedule:
PRINCIPAL
INSTALLMENTS
(Information to be inserted from
schedule in Section 2 hereof).
INTEREST
RATE
(or so much thereof as shall not have been prepaid prior to
maturity) and to pay interest on the unpaid Principal Amount from
the Certificate Date at the per annum rate(s) of interest
specified above computed on the basis of a 360 -day year of twelve
30 -day months; such interest being payable on February 15 and
August 15 of each year, commencing February 15, 1995. Principal
installments of this Certificate are payable at its Stated
Maturity or on a prepayment date to the registered owner hereof by
U. S. Trust Company of Texas, N.A. (the "Paying Agent /Registrar "),
upon its presentation and surrender at its designated offices in
New York, New York (the "Designated Payment /Transfer Office ").
Interest is payable to the registered owner of this Certificate
whose name appears on the "Security Register" maintained by the
Paying Agent /Registrar at the close of business on the "Record
Date ", which is the last business day of the month next preceding
each interest payment date hereof and interest shall be paid by
the Paying Agent /Registrar by check sent United States Mail, first
class postage prepaid, to the address of the registered owner
0188562 -15-
recorded in the Security Register or by such other method,
acceptable to the Paying Agent/ Registrar, requested by, and at
the risk and expense of, the registered owner. All payments of
principal of, premium, if any, and interest on this Certificate
shall be without exchange or collection charges to the owner
hereof and in any coin or currency of the United States of America
which at the time of payment is legal tender for the payment of
public and private debts.
SECTION 10: Definitions. For purposes of this Ordinance
and for clarity with respect to the issuance of the Certificates
herein authorized, and the levy of taxes and appropriation of
Hotel Occupancy Tax Revenues for the payment thereof, the
following words or terms, whenever the same appear herein without
qualifying language, are defined to mean as follows:
0188562
(a) The term "Additional Obligations" shall mean
tax and revenue obligations hereafter issued under and
pursuant to the provisions of V.T.C.A., Local Government
Code, Subchapter C of Chapter 271, or other law and
payable from ad valorem taxes and additionally payable
from and equally and ratably secured with the
Certificates by a parity lien on and pledge of the
Pledged Hotel Tax Receipts.
(b) The term "Certificates" shall mean the
$500,000 "City of Huntsville, Texas, Tax and Hotel
Occupancy Tax Surplus Revenue Certificates of
Obligation, Series 1994 ", dated August 15, 1994
authorized by this Ordinance.
(c) The term "Certificate Fund" shall mean the
special Fund created and established under the
provisions of Section 11 of this Ordinance.
(d) The term "Collection Date" shall mean, when
reference is being made to the levy and collection of
annual ad valorem taxes, the date the annual ad valorem
taxes levied each year by the City become delinquent.
(e) The term "Fiscal Year" shall mean the twelve
month period ending on September 30 of each year.
(f) The term "Hotel Occupancy Tax" shall mean the
tax levied by the City upon the costs of occupancy of
any sleeping room furnished by any hotel, where the cost
of occupancy is at the rate of $2 or more per day, under
authority of V.T.C.A., Tax Code, Chapter 351, as
amended, and pursuant to Ordinance No. 74 -23, passed and
adopted by the City Council of the City of Huntsville,
Texas on November 26, 1974, as amended by Ordinance No.
-16-
77 -16, passed and adopted on July 26, 1977, by Ordinance
No. 94 -11, adopted on March 15, 1994, and any future
City ordinance amending the foregoing Ordinances Nos.
704 -23, 77 -16 and 94 -11.
(g). The term "Outstanding" when used in this
Ordinance with respect to Certificates means, as of the
date of determination, all Certificates theretofore
issued and delivered under this Ordinance, except:
(1) those Certificates cancelled by the
Paying Agent /Registrar or delivered to the
Paying Agent /Registrar for cancellation;
(2) those Certificates deemed to be
duly paid by the City in accordance with the
provisions of Section 24 hereof; and
(3) those Certificates that have been
mutilated, destroyed, lost, or stolen and
replacement Certificates have been registered
and delivered in lieu thereof as provided in
Section 25 hereof.
(h) The term "Pledged Hotel Tax Receipts" shall
mean the portion of the Hotel Occupancy Tax pledged to
the payment of the Certificates in Section 13 hereof.
(i) The term "Prior Lien Obligations" shall mean
revenue bonds or other similar obligations hereafter
issued that are payable from revenues and receipts other
than ad valorem taxes, including a prior lien on and
pledge of the Pledged Hotel Tax Receipts.
SECTION 11: Certificate Fund. For the purpose of paying
the interest on and to provide a sinking fund for the payment,
redemption and retirement of the Certificates, there shall be and
is hereby created a special account on the books of the City to be
designated "SPECIAL 1994 TAX AND HOTEL OCCUPANCY TAX REVENUE
CERTIFICATE OF OBLIGATION FUND ", and all moneys deposited to the
credit of such account shall be kept and maintained in a banking
fund maintained at the City's depository. Authorized officials of
the City are hereby authorized and directed to make withdrawals
from the Certificate Fund sufficient to pay the principal of and
interest on the Certificates as the same become due and payable,
and, shall cause to be transferred to the Paying Agent /Registrar
from moneys on deposit in the Certificate Fund an amount
sufficient to pay the amount of principal and /or interest falling
due on the Certificates, such transfer of funds to the Paying
Agent /Registrar to be made in such manner as will cause
immediately available funds to be deposited with the Paying
0188562 -17-
Agent /Registrar on or before the last business day next preceding
each interest and principal payment date for the Certificates.
Pending the transfer of funds to the Paying Agent /Registrar,
money in the Certificate Fund may, at the option of the City, be
invested in obligations identified in, and in accordance with the
provisions of the "Public Funds Investment Act of 1987" relating
to the investment of "bond proceeds "; provided that all such
investments shall be made in such a manner that the money required
to be expended from said Fund will be available at the proper time
or times. All interest and income derived from deposits and
investments in said Certificate Fund shall be credited to, and any
losses debited to, the said Certificate Fund. All such
investments shall be sold promptly when necessary to prevent any
default in connection with the Certificates.
SECTION 12: Tax Levy. To provide for the payment of the
"Debt Service Requirements" on the Certificates being (i) the
interest on said Certificates and (ii) a sinking fund for their
redemption at maturity or a sinking fund of 2% (whichever amount
shall be the greater), there shall be and there is hereby levied
for the current year and each succeeding year thereafter while
said Certificates or any interest thereon shall remain
Outstanding, a sufficient tax on each one hundred dollars'
valuation of taxable property in said City, adequate to pay such
Debt Service Requirements, full allowance being made for
delinquencies and costs of collection; said tax shall be assessed
and collected each year and applied to the payment of the Debt
Service Requirements, and the same shall not be diverted to any
other purpose. The taxes so levied and collected shall be paid
into the Certificate Fund. The City Council hereby declares its
purpose and intent to provide and levy a tax legally and fully
sufficient to pay the said Debt Service Requirements, it having
been determined that the existing and available taxing authority
of the City for such purpose is adequate to permit a legally
sufficient tax in consideration of all other outstanding
indebtedness.
The amount of taxes to be provided annually for the payment
of the principal of and interest on the Certificates shall be
determined and accomplished in the following manner:
(a) Prior to the date the City Council establishes the
annual tax rate and passes an ordinance levying ad valorem taxes
each year, the Council shall determine:
(1) The amount on deposit in the Certificate Fund
after (a) deducting therefrom the total amount of Debt
Service Requirements to become due on Certificates prior
to the Collection Date for the ad valorem taxes to be
levied and (b) adding thereto the amount of the Pledged
0188562
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Hotel Tax Receipts appropriated and allocated to pay
such Debt Service Requirements prior to the Collection
Date for the ad valorem taxes to be levied.
(2) The amount of Pledged Hotel Tax Receipts,
appropriated and to be set aside for the payment of the
Debt Service Requirements on the Certificates between
the Collection Date for the taxes then to be levied and
the Collection Date for the taxes to be levied during
the next succeeding calendar year.
(3) The amount of Debt Service Requirements to
become due and payable on the Certificates between the
Collection Date for the taxes then to be levied and the
Collection Date for the taxes to be levied during the
next succeeding calendar year.
(b) The amount of taxes to be levied annually each year to
pay the Debt Service Requirements on the Certificates shall be the
amount established in paragraph (3) above less the sum total of
the amounts established in paragraphs (1) and (2), after taking
into consideration delinquencies and costs of collecting such
annual taxes.
SECTION 13: Pledge of Hotel Occupancy Tax Receipts. The
City hereby covenants and agrees that, subject to the prior lien
on and pledge of the Pledged Hotel Tax Receipts to the payment and
security of Prior Lien Obligations, a portion of the receipts
received from the collection of the Hotel Occupancy Tax
(equivalent in amount to a Hotel Occupancy Tax of 2% being levied
under the law, i.e., 3% of the consideration paid by an occupant
of a sleeping room to the hotel -- hereinafter called the "Pledged
Hotel Tax Receipts ") shall be and are hereby irrevocably pledged
to the payment of the principal of and interest on the
Certificates, and Additional Certificates, if issued, and the
pledge of Pledged Hotel Tax Receipts herein made for the payment
of the Certificates shall constitute a lien on the Pledged Hotel
Tax Receipts in accordance with the terms and provisions hereof
and be valid and binding without further action by the City and
without any filing or recording except for the filing of this
Ordinance in the records of the City.
For purposes of satisfying the pledge of the Pledged Hotel
Tax Receipts for the payment of the Certificates, the City hereby
covenants and agrees that, during the period of time the
Certificates are Outstanding, the Pledged Hotel Tax Receipts shall
be deposited, as received and collected, into a special Fund
designated the "City of Huntsville, Texas, Pledged Hotel Occupancy
Tax Fund ", hereby created and to be maintained by the City at its
depository bank, and all Pledged Hotel Tax Receipts deposited
therein shall be pledged and appropriated to the extent required
0188562
-19-
for the following purposes and in the order of priority shown, to
wit:
First: To the payment of all amounts required to be
deposited in the special Funds maintained for the
payment,_ security and benefit of Prior Lien Obligations
in accordance with the terms and provisions of any
ordinance authorizing the issuance of Prior Lien
Obligations.
Second: To the payment, equally and ratably, of the
amounts required to be deposited in the special funds
and accounts created and established for the payment of
the Certificates (the Certificate Fund) as provided in
Section 14 hereof and any special fund or account
maintained for the payment of Additional Certificates.
Any Pledged Hotel Tax Receipts remaining in the "City of
Huntsville, Texas, Pledged Hotel Occupancy Tax Fund ", after
satisfying the foregoing priority, or making adequate and
sufficient provision therefor, may be appropriated and expended
for any purposes now or hereafter permitted by law.
SECTION 14: Deposits to Certificate Fund. The City hereby
covenants and agrees to cause to be deposited to the credit of the
Certificate Fund prior to each principal and interest payment date
for the Certificates from the Pledged Hotel Tax Receipts, after
the deduction of all payments required to be made to the special
Funds or accounts created for the payment and security of the
Prior Lien Obligations, an amount equal to one hundred per
centum (100 %) of the amount required to fully pay the interest and
principal then due and payable on the Certificates, and such
deposits to pay maturing principal and accrued interest on the
Certificates shall be made in substantially equal quarterly
installments on or before the last business day of each March,
June, September and December beginning the September next
following the month the Certificates are delivered to the initial
purchaser(s).
The quarterly deposits to be made to the credit of the
Certificate Fund, as hereinabove provided, shall be made until
such time as such Fund contains an amount equal to pay the
principal of and interest and premium, if any, on the Certificates
to maturity. Accrued interest and premium, if any, received from
the purchaser of the Certificates deposited to the Certificate
Fund and ad valorem taxes levied, collected and deposited in the
Certificate Fund for and on behalf of the Certificates may be
taken into consideration and reduce the amount of the deposits
otherwise required to be deposited in the Certificate Fund from
the Pledged Hotel Tax Receipts. In addition, any surplus proceeds
from the sale of the Certificates not expended for authorized
0188562
-20-
purposes shall be deposited in the Certificate Fund, and such
amounts so deposited shall reduce the sums otherwise required to
be deposited in said Fund from ad valorem taxes and the Pledged
Hotel Tax Receipts.
SECTION 15: Security of Funds. All moneys on deposit in
the Funds for which this Ordinance makes provision (except any
portion thereof as may be at any time properly invested) shall be
secured in the manner and to the fullest extent required by the
laws of Texas for the security of public funds, and moneys on
deposit in such Funds shall be used only for the purposes
permitted by this Ordinance.
SECTION 16: Records and Accounts - Annual Audit. The City
further covenants and agrees that while any of the Certificates
remain Outstanding, it will keep and maintain separate and
complete records and accounts pertaining to the receipt and
disbursement of the Pledged Hotel Tax Receipts. The Holder or
Holders of the Certificates or any duly authorized agent or agents
of such Holders shall have the right to inspect such records and
accounts. The City further agrees that following the close of.
each Fiscal Year, it will cause an audit of such books and
accounts to be made by an independent firm of Certified Public
Accountants. Copies of each annual audit shall be furnished to
the Executive Director of the Municipal Advisory Council of Texas
at his office in Austin, Texas, and, upon written request, to the
original purchaser of the Certificates and any subsequent Holder
thereof.
SECTION 17: Remedies in Event of Default. In
addition to all the rights and remedies provided by the laws of
the State of Texas, the City covenants and agrees particularly
that in the event the City (a) defaults in the payments to be made
to the Certificate Fund, or (b) defaults in the observance or
performance of any other of the covenants, conditions or
obligations set forth in this Ordinance, the owner or owners of
any of the Certificates shall be entitled to a writ of mandamus
issued by a court of proper jurisdiction compelling and requiring
the governing body of the City and other officers of the City to
observe and perform any covenant, condition or obligation
prescribed in this Ordinance.
No delay or omission to exercise any right or power accruing
upon any 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 and power may be exercised from time
to time and as often as may be deemed expedient. The specific
remedies herein provided shall be cumulative of all other existing
remedies and the specification of such remedies shall not be
deemed to be exclusive.
0188562
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SECTION 18: Special Covenants. The City hereby further
covenants as follows:
(a) It has the lawful power to pledge the Pledged
Hotel Tax Receipts supporting this issue of Certificates
and has lawfully exercised said powers under the
Constitution and laws of the State of Texas, including
said power existing under V.T.C.A., Local Government
Code, Sections 271.041, et seq. and V.T.C.A., Tax Code,
Chapter 351, as amended.
(b) Other than for the payment of the
Certificates, the Pledged Hotel Tax Receipts have not in
any manner been pledged to the payment of any debt or
obligation of the City.
SECTION 19: Issuance of Prior Lien Obligations and
Additional Certificates. The City hereby expressly reserves the
right to hereafter issue Prior Lien Obligations, without
limitation as to principal amount but subject to any terms,
conditions or restrictions applicable thereto under law or
otherwise, and, also reserves the right to issue Additional
Certificates which, together with the Certificates, shall be
secured by a parity lien on and pledge of the Pledged Hotel Tax
Receipts.
SECTION 20: Application of Prior Lien Bonds Covenants
and Agreements. It is the intention of this governing body and
accordingly hereby recognized and stipulated that the provisions,
agreements and covenants contained herein bearing upon the Pledged
Hotel Tax Receipts and the administering and application thereof,
shall to the extent possible be harmonized with like provisions,
agreements and covenants contained in the ordinances authorizing
the issuance of the Prior Lien Obligations, and to the extent of
any irreconcilable conflict between the provisions contained
herein and in the ordinances authorizing the issuance of the Prior
Lien Obligations, the provisions, agreements and covenants
contained therein shall prevail to the extent of such conflict and
be applicable to this Ordinance but in all respects subject to the
priority of rights and benefits, if any, conferred thereby to the
holders of the Prior Lien Obligations. Notwithstanding the
above, any change or modification affecting the application of
revenues derived from the Hotel Occupancy Tax shall not impair the
obligation of contract with respect to the pledge of Pledged Hotel
Tax Receipts herein made for the payment and security for the
Certificates.
SECTION 21: Notices to Holders Waiver. Wherever this
Ordinance provides for notice to Holders of any event, such notice
shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and sent by United States Mail, first
0188562
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class postage prepaid, to the address of each Holder appearing on
the Security Register at the close of business on the business day
next preceding the mailing of such notice.
In any case where notice to Holders is given by mail, neither
the failure to mail such notice to any particular Holders, nor any
defect in any notice so mailed, shall affect the sufficiency of
such notice with respect to all other Certificates. Where this
Ordinance provides for notice in any manner, such notice may be
waived in writing by the Holder entitled to receive such
notice, either before or after the event with respect to which
such notice is given, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the
Paying Agent/ Registrar, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon
such waiver.
SECTION 22: Cancellation. All Certificates surrendered
for payment, redemption, transfer, exchange, or replacement, if
surrendered to the Paying Agent /Registrar, shall be promptly
cancelled by it and, if surrendered to the City, shall be
delivered to the Paying Agent /Registrar and, if not already
cancelled, shall be promptly cancelled by the Paying
Agent /Registrar. The City may at any time deliver to the Paying
Agent /Registrar for cancellation any Certificates previously
certified or registered and delivered which the City may have
acquired in any manner whatsoever, and all Certificates so
delivered shall be promptly cancelled by the Paying
Agent /Registrar. All cancelled Certificates held by the Paying
Agent /Registrar shall be returned to the City.
SECTION 23: Covenants to Maintain Tax - Exempt Status.(a)
Definitions. When used in this Section 23, the following terms
have the following meanings:
"Closing Date" means the date on which the
Certificates are first authenticated and delivered to
the initial purchasers against payment therefor.
0188562
"Code" means the Internal Revenue Code of 1986, as
amended by all legislation, if any, effective on or
before the Closing Date.
"Computation Date" has the meaning set forth in
Section 1.148 -1(b) of the Regulations.
"Gross Proceeds" means any proceeds as defined in
Section 1.148 -1(b) of the Regulations, and any
replacement proceeds as defined in Section 1.148 -1(c) of
the Regulations, of the Certificates.
-23-
"Investment" has the meaning set forth in Section
1.148 -1(b) of the Regulations.
"Nonpurpose Investment" means any investment
property, as defined in section 148(b) of the Code, in
which Gross Proceeds of the Certificates are invested
and which is not acquired to carry out the governmental
purposes of the Certificates.
"Rebate Amount" has the meaning set forth in
Section 1.148 -1(b) of the Regulations.
"Regulations" means any proposed, temporary, or
final Income Tax Regulations issued pursuant to Sections
103 and 141 through 150 of the Code, and 103 of the
Internal Revenue Code of 1954, which are applicable to
the Certificates. Any reference to any specific
Regulation shall also mean, as appropriate, any
proposed, temporary or final Income Tax Regulation
designed to supplement, amend or replace the specific
Regulation referenced.
"Yield" of (1) any Investment has the meaning set
forth in Section 1.148 -5 of the Regulations and (2) the
Certificates has the meaning set forth in Section 1.148-
4 of the Regulations.
(b) Not to Cause Interest to Become Taxable. The City shall
not use, permit the use of, or omit to use Gross Proceeds or any
other amounts (or any property the acquisition, construction or
improvement of which is to be financed directly or indirectly with
Gross Proceeds) in a manner which if made or omitted,
respectively, would cause the interest on any Certificate to
become includable in the gross income, as defined in section 61 of
the Code, of the owner thereof for federal income tax purposes.
Without limiting the generality of the foregoing, unless and until
the City receives a written opinion of counsel nationally
recognized in the field of municipal bond law to the effect that
failure to comply with such covenant will not adversely affect the
exemption from federal income tax of the interest on any
Certificate, the City shall comply with each of the specific
covenants in this Section.
(c) No Private Use or Private Payments. Except as permitted
by section 141 of the Code and the Regulations and rulings
thereunder, the City shall at all times prior to the last Stated
Maturity of Certificates:
(1) exclusively own, operate and possess all
property the acquisition, construction or improvement of
which is to be financed or refinanced directly or
0188562 -24-
indirectly with Gross Proceeds of the Certificates, and
not use or permit the use of such Gross Proceeds
(including all contractual arrangements with terms
different than those applicable to the general public)
or any property acquired, constructed or improved with
such Gross Proceeds in any activity carried on by any
person or entity (including the United States or any
agency, department and instrumentality thereof) other
than a state or local government, unless such use is
solely as a member of the general public; and
(2) not directly or indirectly impose or accept
any charge or other payment by any person or entity who
is treated as using Gross Proceeds of the Certificates
or any property the acquisition, construction or
improvement of which is to be financed or refinanced
directly or indirectly with such Gross Proceeds, other
than taxes of general application within the City or
interest earned on investments acquired with such Gross
Proceeds pending application for their intended
purposes.
(d) No Private Loan. Except to the extent permitted by
section 141 of the Code and the Regulations and rulings
thereunder, the City shall not use Gross Proceeds of the
Certificates to make or finance loans to any person or entity
other than a state or local government. For purposes of the
foregoing covenant, such Gross Proceeds are considered to be
"loaned" to a person or entity if: (1) property acquired,
constructed or improved with such Gross Proceeds is sold or leased
to such person or entity in a transaction which creates a debt for
federal income tax purposes; (2) capacity in or service from such
property is committed to such person or entity under a
take -or -pay, output or similar contract or arrangement; or (3)
indirect benefits, or burdens and benefits of ownership, of such
Gross Proceeds or any property acquired, constructed or improved
with such Gross Proceeds are otherwise transferred in a
transaction which is the economic equivalent of a loan.
(e) Not to Invest at Higher Yield. Except to the extent
permitted by section 148 of the Code and the Regulations and
rulings thereunder, the City shall not at any time prior to the
final Stated Maturity of the Certificates directly or indirectly
invest Gross Proceeds in any Investment (or use Gross Proceeds to
replace money so invested), if as a result of such investment the
Yield from the Closing Date of all Investments acquired with Gross
Proceeds (or with money replaced thereby), whether then held or
previously disposed of, exceeds the Yield of the Certificates.
(f) Not Federally Guaranteed. Except to the extent
permitted by section 149(b) of the Code and the Regulations and
0188562
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rulings thereunder, the City shall not take or omit to take any
action which would cause the Certificates to be federally
guaranteed within the meaning of section 149(b) of the Code and
the Regulations and rulings thereunder.
(g) Information Report. The City shall timely file the
information required by section 149(e) of the Code with the
Secretary of the Treasury on Form 8038 -G or such other form and in
such place as the Secretary may prescribe.
(h) No Rebate Required. The City warrants and represents
that it satisfies the requirements of paragraph (2) and (3) of
section 148(f) of the Code with respect to the Certificates
without making the payments for the United States described in
such section. Specifically, the City warrants and represents that
(1) the City is a governmental unit with general
taxing powers;
(2) at least 95% of the Gross Proceeds of the
Certificates will be used for the local governmental
activities of the City;
(3) the aggregate face amount of all tax - exempt
obligations issued or expected to be issued by the City
(and all subordinate entities thereof) in the calendar
year in which the Certificates are issued is not
reasonably expected to exceed $5,000,000.
PROVIDED, HOWEVER, should additional tax exempt obligations
be issued or incurred, including lease purchase financings, in the
1994 calendar year which would cause the total face amount of tax
exempt obligations issued and incurred in such calendar year to
exceed $5,000,000, the City agrees and covenants that it will
maintain complete records regarding the investments of the
proceeds of sale of the Certificates and rebate any "arbitrage
profits" to the United States as required by Section 148(f) of the
Code.
(i) Elections. The City hereby directs and authorizes the
Mayor, City Manager, Director of Finance City Secretary,
individually or jointly, to make elections permitted or required
pursuant to the provisions of the Code or the Regulations, as they
deem necessary or appropriate in connection with the Certificates,
in the Certificate as to Tax Exemption or similar or other
appropriate certificate, form or document.
SECTION 24: Satisfaction of Obligations of City. If the
City shall pay or cause to be paid, or there shall otherwise be
paid to the Holders, the principal of, premium, if any, and
interest on the Certificates, at the times and in the manner
0188562 -26-
stipulated in this Ordinance, then the pledge of taxes levied
under this Ordinance and the Pledged Hotel Tax Receipts and all
covenants, agreements, and other obligations of the City to the
Holders shall thereupon cease, terminate, and be discharged and
satisfied.
Certificates or any principal amount(s) thereof shall be
deemed to have been paid within the meaning and with the effect
expressed above in this Section when (i) money sufficient to pay
in full such Certificates or the principal amount(s) thereof at
maturity or the redemption date therefor, together with all
interest due thereon, shall have been irrevocably deposited with
and held in trust by the Paying Agent /Registrar, or an authorized
escrow agent, or (ii) Government Obligations shall have been
irrevocably deposited in trust with the Paying Agent /Registrar, or
an authorized escrow agent, which Government Obligations have been
certified by an independent accounting firm to mature as to
principal and interest in such amounts and at such times as will
insure the availability, without reinvestment, of sufficient
money, together with any moneys deposited therewith, if any, to
pay when due the principal of and interest on such Certificates,
or the principal amount(s) thereof, on and prior to the Stated
Maturity thereof or (if notice of redemption has been duly given
or waived or if irrevocable arrangements therefor acceptable to
the Paying Agent/ Registrar have been made) the redemption date
thereof. The City covenants that no deposit of moneys or
Government securities will be made under this Section and no use
made of any such deposit which would cause the Certificates to be
treated as "arbitrage bonds" within the meaning of Section 148 of
the Internal Revenue Code of 1986, as amended, or regulations
adopted pursuant thereto.
Any moneys so deposited with the Paying Agent/ Registrar, or
an authorized escrow agent, and all income from Government
Obligations held in trust by the Paying Agent /Registrar, or an
authorized escrow agent, pursuant to this Section which is not
required for the payment of the Certificates, or any principal
amount(s) thereof, or interest thereon with respect to which such
moneys have been so deposited shall be remitted to the City or
deposited as directed by the City. Furthermore, any money held by
the Paying Agent /Registrar for the payment of the principal of and
interest on the Certificates and remaining unclaimed for a period
of four (4) years after the Stated Maturity, or applicable
redemption date, of the Certificates such moneys were deposited
and are held in trust to pay shall upon the request of the City be
remitted to the City against a written receipt therefor.
Notwithstanding the above and foregoing, any remittance of funds
from the Paying Agent /Registrar to the City shall be subject to
any applicable unclaimed property laws of the State of Texas.
0188562
-27-
The term "Government Obligations ", as used herein, means
direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United
States of America, which are non - callable prior to the respective
Stated Maturities of the Certificates and may be United States
Treasury Obligations such as the State and Local Government Series
and may be in book -entry form.
SECTION 25: Mutilated. Destroyed. Lost. and Stolen
Certificates. In case any Certificate shall be mutilated, or
destroyed, lost or stolen, the Paying Agent /Registrar may execute
and deliver a replacement Certificate of like form and tenor, and
in the same denomination and bearing a number not
contemporaneously outstanding, in exchange and substitution for
such mutilated Certificate, or in lieu of and in substitution for
such destroyed, lost or stolen Certificate, only upon the approval
of the City and after (i) the filing by the Holder thereof with
the Paying Agent /Registrar of evidence satisfactory to the Paying
Agent /Registrar of the destruction, loss or theft of such
Certificate, and of the authenticity of the ownership thereof and
(ii) the furnishing to the Paying Agent /Registrar of .
indemnification in an amount satisfactory to hold the City and the
Paying Agent /Registrar harmless. All expenses and charges
associated with such indemnity and with the preparation, execution
and delivery of a replacement Certificate shall be borne by the
Holder of the Certificate mutilated, or destroyed, lost or stolen.
Every replacement Certificate issued pursuant to this Section
shall be a valid and binding obligation, and shall be entitled to
all the benefits of this Ordinance equally and ratably with all
other Outstanding Certificates; notwithstanding the enforceability
of payment by anyone of the destroyed, lost, or stolen
Certificates.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with
respect to the replacement and payment of mutilated, destroyed,
lost or stolen Certificates.
SECTION 26: Ordinance a Contract - Amendments. This
Ordinance shall constitute a contract with the Holders from time
to time, be binding on the City, and shall not be amended or
repealed by the City so long as any Certificate remains
Outstanding except as permitted in this Section. The City, may,
without the consent of or notice to any Holders, from time to time
and at any time, amend this Ordinance in any manner not
detrimental to the interests of the Holders, including the curing
of any ambiguity, inconsistency, or formal defect or omission
herein. In addition, the City may, with the written consent of
Holders holding a majority in aggregate principal amount of the
Certificates and Additional Certificates then Outstanding affected
0188562
-28-
thereby, amend, add to, or rescind any of the provisions of this
Ordinance; provided that, without the consent of all Holders of
Outstanding Certificates, no such amendment, addition, or
rescission shall (1) extend the time or times of payment of the
principal of, premium, if any, and interest on the Certificates,
reduce the principal amount thereof, the redemption price, or the
rate of interest thereon, or in any other way modify the terms of
payment of the principal of, premium, if any, or interest on the
Certificates, (2) give any preference to any Certificate over any
other Certificate, or (3) reduce the aggregate principal amount of
Certificates required to be held by Holders for consent to any
such amendment, addition, or rescission.
SECTION 27: Qualified Tax Exempt Obligations. In
accordance with the provisions of paragraph 3 of subsection b of
Section 265 of the Code, the City hereby designates the
Certificates to be "qualified tax exempt obligations" in that the
Certificates are not "private activity bonds" as defined in the
Code and the reasonably anticipated amount of "qualified tax
exempt obligations" to be issued by the City (including all
subordinate entities of the City) for the calendar year 1994 will
not exceed $10,000,000.
SECTION 28: Sale of Certificates - Official Statement
Approval. The Certificates authorized by this Ordinance are
hereby sold by the City to First Southwest Company (herein
referred to as the "Underwriters ") in accordance with the Purchase
Contract (the "Contract "), dated August 16, 1994, attached hereto
as Exhibit B and incorporated herein by reference as a part of
this Ordinance for all purposes. The Mayor is hereby authorized
and directed to execute said Contract for and on behalf of the
City and as the act and deed of this Council, and in regard to the
approval and execution of the Contract, the Council hereby finds,
determines and declares that the representations, warranties and
agreements of the City contained therein are true and correct in
all material respects and shall be honored and performed by the
City.
Furthermore, the use of the Preliminary Official Statement in
connection with the public offering and sale of the Certificates
is hereby ratified, confirmed and approved in all respects. The
final Official Statement reflecting the terms of sale, attached as
exhibit A to the Contract (together with such changes approved by
the Mayor, City Manager or Director of Finance, any one or more of
said officials), shall be and is hereby in all respects approved
and the Underwriters are hereby authorized to use and distribute
said final Official Statement, dated August 16, 1994, in the
reoffering, sale and delivery of the Certificates to the public.
The Mayor and City Secretary are further authorized and directed
to manually execute and deliver for and on behalf of the City
copies of said Official Statement in final form as may be required
0188562 -29-
by the Underwriters, and such Official Statement in the final form
and content manually executed by any one or more of said officials
shall be deemed to be approved by the City Council and constitute
the Official Statement authorized for distribution and use by the
Underwriters.
SECTION 29: Proceeds of Sale. The proceeds of sale of the
Certificates, excluding the accrued interest received from the
Underwriters, shall be deposited in a construction fund maintained
at the City's depository bank. Pending expenditure for authorized
projects and purposes, such proceeds of sale may be invested in
authorized investments and any investment earnings realized may be
expended for such authorized projects and purposes or deposited in
the Certificate Fund as shall be determined by the City Council.
Accrued interest received from the Underwriters as well as all
surplus proceeds of sale of the Certificates, including investment
earnings, remaining after completion of all authorized projects or
purposes shall be deposited to the credit of the Certificate Fund.
SECTION 30: Control and Custody of Certificates. The
Mayor of the City shall be and is hereby authorized to take and
have charge of all necessary orders and records pending the sale
of the Certificates, the investigation by the Attorney General of
the State of Texas, including the printing and supply of
definitive Certificates, and shall take and have charge and
control of the Initial Certificate pending the approval thereof by
the Attorney General and its registration thereof by the
Comptroller of Public Accounts.
Furthermore, the Mayor, City Manager, City Secretary,
Director of Finance and City Attorney, any one or more of said
officials, are hereby authorized and directed to furnish and
execute such documents and certifications relating to the City and
the issuance of the Certificates, including a certification as to
facts, estimates, circumstances and reasonable expectations
pertaining to the use and expenditure and investment of the
proceeds of the Certificates as may be necessary for the approval
of the Attorney General and their registration by the Comptroller
of Public Accounts. In addition, such officials, together with
the City's financial advisor, bond counsel and the Paying
Agent /Registrar, are authorized and directed to make the necessary
arrangements for the delivery of the Initial Certificate(s) to the
initial purchasers.
SECTION 31: Bond Counsel's Opinion. The Underwriters'
obligation to accept delivery of the Certificates is subject to
being furnished a final opinion of Fulbright & Jaworski L.L.P.,
Dallas, Texas, approving the Certificates as to their validity,
said opinion to be dated and delivered as of the date of delivery
and payment for the Certificates. An executed counterpart of said
opinion shall accompany the global certificates deposited with The
0188562
-30-
Depository Trust Company or a reproduction thereof shall be
printed on the definitive Certificates in the event the book entry
only system shall be discontinued.
SECTION 32: CUSIP Numbers. CUSIP numbers may be printed
or typed on the definitive Certificates. It is expressly
provided, however, that the presence or absence of CUSIP numbers
on the definitive Certificates shall be of no significance or
effect as regards the legality thereof and neither the City nor
attorneys approving said Certificates as to legality are to be
held responsible for CUSIP numbers incorrectly printed or typed on
the definitive Certificates.
SECTION 33: Benefits of Ordinance,. Nothing in this
Ordinance, expressed or implied, is intended or shall be construed
to confer upon any person other than the City, the Paying
Agent /Registrar, and the Holders, any right, remedy, or claim,
legal or equitable, under or by reason of this Ordinance or any
provision hereof, this Ordinance and all its provisions being
intended to be and being for the sole and exclusive benefit of the
City, the Paying Agent /Registrar and the Holders.
SECTION 34: Inconsistent Provisions. All ordinances,
orders, or resolutions, or parts thereof which are in conflict or
inconsistent with any provision of this Ordinance are hereby
repealed to the extent of such conflict and the provisions of this
Ordinance shall be and remain controlling as to the matters
contained herein.
SECTION 35: Governing Law. This Ordinance shall be
construed and enforced in accordance with the laws of the State of
Texas and the United States of America.
SECTION 36: Effect of Headings. The Section headings
herein are for convenience only and shall not affect the
construction hereof.
SECTION 37: Severability. If any provision of this
Ordinance or the application thereof to any circumstance shall be
held to be invalid, the remainder of this Ordinance or the
application thereof to other circumstances shall nevertheless be
valid, and this governing body hereby declares that this Ordinance
would have been enacted without such invalid provision.
SECTION 38: Construction of Terms. If appropriate in the
context of this Ordinance, words of the singular number shall be
considered to include the plural, words of the plural number shall
be considered to include the singular, and words of the masculine,
feminine or neuter gender shall be considered to include the other
genders.
0188562
SECTION 39: Public Meeting. It is officially found,
determined, and declared that the meeting at which this Ordinance
is adopted was open to the public and public notice of the time,
place, and subject matter of the public business to be considered
at such meeting, including this Ordinance, was given, all as
required by V.T.C.A., Government Code, Chapter 551, as amended.
SECTION 40: Effective Date. This Ordinance shall take
effect and be in force immediately from and after its adoption,
and it is so ordained.
PASSED AND ADOPTED, this August 16, 1994.
ATTES :
ty Secretary
(City Seal)
0188562
CITY OF HUNTSVILLE, TEXAS
APPROVED:
City Attorney
-32-
EXHIBIT A ,�
PAYING AGENT /REGISTRAR AGREEMENT
THIS AGREEMENT entered into as of August 16, 1994 (this
"Agreement "), by and between the City of Huntsville, Texas (the
"Issuer "), and U. S. Trust Company of Texas, N.A., a banking
association duly organized and existing under the laws of the
United States of America (the "Bank ").
RECITALS
WHEREAS, the Issuer has duly authorized and provided for the
issuance of its "City of Huntsville, Texas, Tax and Hotel
Occupancy Tax Surplus Revenue Certificates of Obligation, Series
1994" (the "Securities ") in the aggregate principal amount of
$500,000, which Securities are scheduled to be delivered to the
initial purchasers on or about September 13, 1994; and
WHEREAS, the Issuer has selected and the Bank has agreed to
serve as Paying Agent /Registrar in connection with the payment of
the principal of, premium, if any, and interest on said Securities .
and with respect to the registration, transfer and exchange
thereof by the registered owners; and
WHEREAS, the Bank represents it has full power and authority
to perform and serve as Paying Agent /Registrar for the Securities;
NO THEREFORE, it is mutually agreed as follows:
ARTICLE ONE
APPOINTMENT OF BANK AS
PAYING AGENT AND REGISTRAR
Section 1.01. Appointment,. The Issuer hereby appoints the
Bank to serve as Paying Agent with respect to the Securities, and,
as Paying Agent for the Securities, the Bank shall be responsible
for paying on behalf of the Issuer the principal, premium (if
any), and interest on the Securities as the same become due and
payable to the registered owners thereof; all in accordance with
this Agreement and the "Bond Resolution" (hereinafter defined).
The Issuer hereby appoints the Bank as Registrar with respect to
the Securities and, as Registrar for the Securities, the Bank
shall keep and maintain for and on behalf of the Issuer books and
records as to the ownership of said Securities and with respect to
the transfer and exchange thereof as provided herein and in the
"Bond Resolution ".
The Bank hereby accepts its appointment, and agrees to serve
as the Paying Agent and Registrar for the Securities.
0189869
Section 1.02. Compensation. As compensation for the Bank's
services as Paying Agent /Registrar, the Issuer hereby agrees to
pay the Bank the fees and amounts set forth in Annex A attached
hereto for the remainder of the Fiscal Year during which the
Agreement is executed and thereafter the fees and amounts set
forth in the Bank's current fee schedule then in effect for
services as Paying Agent /Registrar for municipalities, which shall
be supplied to the Issuer on or before 90 days prior to the close
of the Fiscal Year of the Issuer, and shall be effective upon the
first day of the following Fiscal Year. This agreement assumes
retention by the Paying Agent of the float on uninvested funds
held in accounts by the Paying Agent.
In addition, the Issuer agrees to reimburse the Bank upon its
request for all reasonable expenses, disbursements and advances
incurred or made by the Bank in accordance with any of the
provisions hereof (including the reasonable compensation and the
expenses and disbursements of its agents and counsel).
ARTICLE TWO
DEFINITIONS
Section 2.01. Definitions. For all purposes of this
Agreement, except as otherwise expressly provided or unless the
context otherwise requires:
0189869
"Acceleration Date" on any Security means the date on
and after which the principal or any or all installments of
interest, or both, are due and payable on any Security which
has become accelerated pursuant to the terms of the Security.
"Bank Office" means the principal office of the Bank as
indicated on page 11 hereof. The Bank will notify the Issuer
in writing of any change in location of the Bank Office.
"Bond Resolution" means the resolution, order, or
ordinance of the governing body of the Issuer pursuant to
which the Securities are issued, certified by the Secretary
or any other officer of the Issuer and delivered to the Bank.
"Fiscal Year" means the fiscal year of the Issuer,
ending September 30th.
"Holder" and "Security Holder" each means the Person in
whose name a Security is registered in the Security Register.
"Issuer Request" and "Issuer Order" means a written
request or order signed in the name of the Issuer by the
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EXHIBIT 4
Mayor, City Manager, Director of Finance or City Secretary,
any one or more of said officials, and delivered to the Bank.
"Legal Holiday" means a day on which the Bank is
required or authorized to be closed.
"Person " means any individual, corporation, partnership,
joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or
political subdivision of a government.
"Predecessor Securities" of any particular Security
means every previous Security evidencing all or a portion of
the same obligation as that evidenced by such particular
Security (and, for the purposes of this definition, any
mutilated, lost, destroyed, or stolen Security for which a
replacement Security has been registered and delivered in
lieu thereof pursuant to Section 4.06 hereof and the
Resolution).
"Redemption Date" when used with respect to any Security
to be redeemed means the date fixed for such redemption
pursuant to the terms of the Bond Resolution.
"Responsible Officer" when used with respect to the Bank
means the Chairman or Vice - Chairman of the Board of
Directors, the Chairman or Vice - Chairman of the Executive
Committee of the Board of Directors, the President, any Vice
President, the Secretary, any Assistant Secretary, the
Treasurer, any Assistant Treasurer, the Cashier, any
Assistant Cashier, any Trust Officer or Assistant Trust
Officer, or any other officer of the Bank customarily
performing functions similar to those performed by any of the
above designated officers and also means, with respect to a
particular corporate trust matter, any other officer to whom
such matter is referred because of his knowledge of and
familiarity with the particular subject.
"Security Register" means a register maintained by the
Bank on behalf of the Issuer providing for the registration
and transfers of Securities.
"Stated Maturity" means the date specified in
Resolution the principal of a Security is scheduled
and payable.
Section 2.02. Other Definitions. The terms
"Issuer, " and "Securities (Security)" have the meanings
to them in the recital paragraphs of this Agreement.
0189869
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EXHIBIT A
the Bond
to be due
"Bank,"
assigned
The term "Paying Agent /Registrar" refers to the Bank in the
performance of the duties and functions of this Agreement.
ARTICLE THREE
PAYING AGENT
Section 3.01. Duties of Paying Agent. As Paying Agent, the
Bank shall, provided adequate collected funds have been provided
to it for such purpose by or on behalf of the Issuer, pay on
behalf of the Issuer the principal of each Security at its Stated
Maturity, Redemption Date, or Acceleration Date, to the Holder
upon surrender of the Security to the Bank at the following
offices:
By Hand:
U. S. Trust Company
of Texas, N.A.
65 Beaver Street
Lower Level
New York, New York 10005
By Mail:
U. S. Trust Company
of Texas, N.A.
P. O. Box 844
Cooper Station
New York, New York 10276
As Paying Agent, the Bank shall, provided adequate collected
funds have been provided to it for such purpose by or on behalf of
the Issuer, pay on behalf of the Issuer the interest on each
Security when due, by computing the amount of interest to be paid
each Holder and making payment thereof to the Holders of the
Securities (or their Predecessor Securities) on the Record Date.
All payments of principal and /or interest on the Securities to the
registered owners shall be accomplished (1) by the issuance of
checks, payable to the registered owners, drawn on the fiduciary
account provided in Section 5.05 hereof, sent by United States
mail, first class, postage prepaid, to the address appearing on
the Security Register or (2) by such other method, acceptable to
the Bank, requested in writing by the Holder at the Holder's risk
and expense.
Section 3.02. Payment Dates. The Issuer hereby instructs
the Bank to pay the principal of and interest on the Securities at
the dates specified in the Bond Resolution.
ARTICLE FOUR
REGISTRAR
Section 4.01. Security Register - Transfers and Exchanges.
The Bank agrees to keep and maintain for and on behalf of the
Issuer at the Bank Office books and records (herein sometimes
referred to as the "Security Register ") for recording the names
and addresses of the Holders of the Securities, the transfer,
exchange and replacement of the Securities and the payment of the
0189869
-4-
EXHIBIT A
principal of and interest on the Securities to the Holders and
containing such other information as may be reasonably required by
the Issuer and subject to such reasonable regulations as the
Issuer and Bank may prescribe. All transfers, exchanges and
replacement of Securities shall be noted in the Security Register.
The Bank represents and warrants its office in Dallas, Texas will
at all times have immediate access to the Security Register by
electronic or other means and will be capable at all times of
producing a hard copy of the Security Register at its Dallas
office for use by the Issuer. All transfers, exchanges and
replacement of Securities shall be noted in the Security Register.
Every Security surrendered for transfer or exchange shall be
duly endorsed or be accompanied by a written instrument of
transfer, the signature on which has been guaranteed by an officer
of a federal or state bank or a member of the National Association
of Securities Dealers, in form satisfactory to the Bank, duly
executed by the Holder thereof or his agent duly authorized in
writing.
The Bank may request any supporting documentation it feels .
necessary to effect a re- registration, transfer or exchange of the
Securities.
To the extent possible and under reasonable circumstances,
the Bank agrees that, in relation to an exchange or transfer of
Securities, the exchange or transfer by the Holders thereof will
be completed and new Securities delivered to the Holder or the
assignee of the Holder in not more than three (3) business days
after the receipt of the Securities to be cancelled in an exchange
or transfer and the written instrument of transfer or request for
exchange duly executed by the Holder, or his duly authorized
agent, in form and manner satisfactory to the Paying
Agent /Registrar.
Section 4.02. Certificates. The Issuer shall provide an
adequate inventory of printed Securities to facilitate transfers
or exchanges thereof. The Bank covenants that the inventory of
printed Securities will be kept in safekeeping pending their use
and reasonable care will be exercised by the Bank in maintaining
such Securities in safekeeping, which shall be not less than the
care maintained by the Bank for debt securities of other
governments or corporations for which it serves as registrar, or
that is maintained for its own securities.
Section 4.03. Form of Security Register. The Bank, as
Registrar, will maintain the Security Register relating to the
registration, payment, transfer and exchange of the Securities in
accordance with the Bank's general practices and procedures in
effect from time to time. The Bank shall not be obligated to
maintain such Security Register in any form other than those which
0189869
-5-
EXHIBIT A
the Bank has currently available and currently utilizes at the
time.
The Security Register may be maintained in written form or in
any other form capable of being converted into written form within
a reasonable time.
Section 4.04. List of Security Holders. The Bank will
provide the Issuer at any time requested by the Issuer, upon
payment of the required fee, a copy of the information contained
in the Security Register. The Issuer may also inspect the
information contained in the Security Register at any time the
Bank is customarily open for business, provided that reasonable
time is allowed the Bank to provide an up -to -date listing or to
convert the information into written form.
The Bank will not release or disclose the contents of the
Security Register to any person other than to, or at the written
request of, an authorized officer or employee of the Issuer,
except upon receipt of a court order or as otherwise required by
law. Upon receipt of a court order and prior to the release or .
disclosure of the contents of the Security Register, the Bank will
notify the Issuer so that the Issuer may contest the court order
or such release or disclosure of the contents of the Security
Register.
Section 4.05. Return of Cancelled Certificates. The Bank
will, at such reasonable intervals as it determines, surrender to
the Issuer, Securities in lieu of which or in exchange for which
other Securities have been issued, or which have been paid.
Section 4.06. Mutilated. Destroyed. Lost or Stolen Securi-
ties. The Issuer hereby instructs the Bank, subject to the
provisions of Section 25 of the Bond Resolution, to deliver and
issue Securities in exchange for or in lieu of mutilated,
destroyed, lost, or stolen Securities as long as the same does not
result in an overissuance.
In case any Security shall be mutilated, or destroyed, lost
or stolen, the Bank may execute and deliver a replacement Security
of like form and tenor, and in the same denomination and bearing
a number not contemporaneously outstanding, in exchange and
substitution for such mutilated Security, or in lieu of and in
substitution for such destroyed lost or stolen Security, only upon
the approval of the Issuer and after (i) the filing by the Holder
thereof with the Bank of evidence satisfactory to the Bank of the
destruction, loss or theft of such Security, and of the
authenticity of the ownership thereof and (ii) the furnishing to
the Bank of indemnification in an amount satisfactory to hold the
Issuer and the Bank harmless. All expenses and charges associated
with such indemnity and with the preparation, execution and
0189869
-6-
delivery of a replacement Security shall be borne by the Holder of
the Security mutilated, or destroyed, lost or stolen.
Section 4.07. Transaction Information to Issuer. The Bank
will, within a reasonable time after receipt of written request
from the Issuer, furnish the Issuer information as to the
Securities it has paid pursuant to Section 3.01, Securities it has
delivered upon the transfer or exchange of any Securities pursuant
to Section 4.01, and Securities it has delivered in exchange for
or in lieu of mutilated, destroyed, lost, or stolen Securities
pursuant to Section 4.06.
ARTICLE FIVE
THE BANK
Section 5.01. Duties of Bank. The Bank
perform the duties set forth herein and agrees to
care in the performance thereof.
Section 5.02. Reliance on Documents. Etc.
may conclusively rely, as to the truth of the
correctness of the opinions expressed therein, on
opinions furnished to the Bank.
(b) The Bank shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be
proved that the Bank was negligent in ascertaining the pertinent
facts.
undertakes to
use reasonable
(a) The Bank
statements and
certificates or
(c) No provisions of this Agreement shall require the Bank
to expend or risk its own funds or otherwise incur any financial
liability for performance of any of its duties hereunder, or in
the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or
adequate indemnity satisfactory to it against such risks or
liability is not assured to it.
(d) The Bank may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, note, security, or other paper or
document believed by it to be genuine and to have been signed or
presented by the proper party or parties. Without limiting the
generality of the foregoing statement, the Bank need not examine
the ownership of any Securities, but is protected in acting upon
receipt of Securities containing an endorsement or instruction of
transfer or power of transfer which appears on its face to be
signed by the Holder or an agent of the Holder. The Bank shall
not be bound to make any investigation into the facts or matters
stated in a resolution, certificate, statement, instrument,
0189869
-7-
EXHIBIT A
opinion, report, notice, request, direction, consent, order, bond,
note, security, or other paper or document supplied by Issuer.
(e) The Bank may consult with counsel, and the written
advice of such counsel or any opinion of counsel shall be full and
complete authorization and protection with respect to any action
taken, suffered, or omitted by it hereunder in good faith and in
reliance thereon.
(f) The Bank may exercise any of the powers hereunder and
perform any duties hereunder either directly or by or through
agents or attorneys of the Bank.
Section 5.03. Recitals of Issuer. The recitals contained
herein with respect to the Issuer and in the Securities shall be
taken as the statements of the Issuer, and the Bank assumes no
responsibility for their correctness.
The Bank shall in no event be liable to the Issuer, any
Holder or Holders of any Security, or any other Person for any
amount due on any Security from its own funds.
Section 5.04. May Hold Securities. The Bank, in its
individual or any other capacity, may become the owner or pledgee
of Securities and may otherwise deal with the Issuer with the same
rights it would have if it were not the Paying Agent /Registrar, or
any other agent.
Section 5.05. Moneys Held by Bank - Fiduciary Account/
Collateralization. A fiduciary account shall at all times be kept
and maintained by the Bank for the receipt, safekeeping and
disbursement of moneys received from the Issuer hereunder for the
payment of the Securities, and money deposited to the credit of
such account until paid to the Holders of the Securities shall be
continuously collateralized by securities or obligations which
qualify and are eligible under both the laws of the State of Texas
and the laws of the United States of America to secure and be
pledged as collateral for fiduciary accounts to the extent such
money is not insured by the Federal Deposit Insurance Corporation.
Payments made from such fiduciary account shall be made by check
drawn on such fiduciary account unless the owner of such
Securities shall, at its own expense and risk, request such other
medium of payment.
The Bank shall be under no liability for interest on any
money received by it hereunder.
Subject to the applicable unclaimed property laws of the
State of Texas, any money deposited with the Bank for the payment
of the principal, premium (if any), or interest on any Security
and remaining unclaimed for four years after final maturity of the
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Security has become due and payable will be paid by the Bank to
the Issuer, and the Holder of such Security shall thereafter look
only to the Issuer for payment thereof, and all liability of the
Bank with respect to such moneys shall thereupon cease.
Section 5.06. Indemnification. To the extent permitted by
law, the Issuer agrees to indemnify the Bank for, and hold it
harmless against, any loss, liability, or expense incurred without
negligence or bad faith on its part, arising out of or in
connection with its acceptance or administration of its duties
hereunder, including the cost and expense against any claim or
liability in connection with the exercise or performance of any of
its powers or duties under this Agreement.
Section 5.07. Interpleader. The Issuer and the Bank agree
that the Bank may seek adjudication of any adverse claim, demand,
or controversy over its person as well as funds on deposit, in
either a Federal or State District Court located in the State and
County where either the Bank Office or the administrative offices
of the Issuer is located, and agree that service of process by
certified or registered mail, return receipt requested, to the
address referred to in Section 6.03 of this Agreement shall
constitute adequate service. The Issuer and the Bank further
agree that the Bank has the right to file a Bill of Interpleader
in any court of competent jurisdiction to determine the rights of
any Person claiming any interest herein.
Section 5.08. DT Services. It is hereby represented and
warranted that, in the event the Securities are otherwise
qualified and accepted for "Depository Trust Company" services or
equivalent depository trust services by other organizations, the
Bank has the capability and, to the extent within its control,
will comply with the "Operational Arrangements ", effective August
1, 1987, which establishes requirements for securities to be
eligible for such type depository trust services, including, but
not limited to, requirements for the timeliness of payments and
funds availability, transfer turnaround time, and notification of
redemptions and calls.
ARTICLE SIX
MISCELLANEOUS PROVISIONS
Section 6.01. Amendment. This Agreement may be amended only
by an agreement in writing signed by both of the parties hereto.
Section 6.02. Assignment. This Agreement may not be
assigned by either party without the prior written consent of the
other.
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EXHIBIT A
Section 6.03. Notices. Any request, demand, authorization,
direction, notice, consent, waiver, or other document provided or
permitted hereby to be given or furnished to the Issuer or the
Bank shall be mailed or delivered to the Issuer or the Bank,
respectively, at the addresses shown on page 11.
Section 6.04. Effect of Headings. The Article and Section
headings herein are for convenience only and shall not affect the
construction hereof.
Section 6.05. Successors and Assigns. All covenants and
agreements herein by the Issuer shall bind its successors and
assigns, whether so expressed or not.
Section 6.06. Severability. In case any provision herein
shall be invalid, illegal, or unenforceable, the validity,
legality, and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
Section 6.07. Benefits of Agreement. Nothing herein,
express or implied, shall give to any Person, other than the .
parties hereto and their successors hereunder, any benefit or any
legal or equitable right, remedy, or claim hereunder.
Section 6.08. Entire Agreement. This Agreement and the Bond
Resolution constitute the entire agreement between the parties
hereto relative to the Bank acting as Paying Agent /Registrar and
if any conflict exists between this Agreement and the Bond
Resolution, the Bond Resolution shall govern.
Section 6.09. Counterparts. This Agreement may be executed
in any number of counterparts, each of which shall be deemed an
original and all of which shall constitute one and the same
Agreement.
Section 6.10. Termination. This Agreement will terminate
(i) on the date of final payment of the principal of and interest
on the Securities to the Holders thereof or (ii) may be earlier
terminated by either party upon sixty (60) days written notice;
provided, however, an early termination of this Agreement by
either party shall not be effective until (a) a successor Paying
Agent /Registrar has been appointed by the Issuer and such
appointment accepted and (b) notice given to the Holders of the
Securities of the appointment of a successor Paying
Agent /Registrar. Furthermore, the Bank and Issuer mutually agree
that the effective date of an early termination of this Agreement
shall not occur at any time which would disrupt, delay or
otherwise adversely affect the payment of the Securities.
Upon an early termination of this Agreement, the Bank agrees
to promptly transfer and deliver the Security Register (or a copy
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EXHIBIT A
thereof), together with other pertinent books and records relating
to the Securities, to the successor Paying Agent /Registrar
designated and appointed by the Issuer.
The provisions of Section 1.02 and of Article Five shall
survive and remain in full force and effect following the
termination of this Agreement.
Section 6.11. Governing Law. This Agreement shall be
construed in accordance with and governed by the laws of the State
of Texas.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the day and year first above written.
U.S. TRUST COMPANY OF TEXAS, N.A.
BY
Title:
(SEAL]
Attest:
Address: 500 N. Akard, Suite 2100
Dallas, Texas 75201
CITY OF HUNTSVILLE, TEXAS
BY
Mayor
Address: 1212 Avenue M
Attest: Huntsville, Texas 77340
Title:
(CITY SEAL)
City Secretary
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