Ordinance 2012-31-2 - Refunding Bonds ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF HUNTSVILLE, TEXAS
GENERAL OBLIGATION REFUNDING BONDS, SERIES 2012; APPROVING AN
OFFICIAL STATEMENT; AUTHORIZING EXECUTION OF A PAYING
AGENT/REGISTRAR AGREEMENT,A BOND PURCHASE AGREEMENT AND AN
ESCROW AGREEMENT; ESTABLISHING PROCEDURES FOR SELLING AND
DELIVERING THE BONDS; AND AUTHORIZING OTHER MATTERS RELATING
TO THE BONDS
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Adopted June 19,2012
HUNTSVILLE GORB\2012. Ordinance
TABLE OF CONTENTS
Page
Section 1. Recitals 2
Section 2. Definitions 2
Section 3. Amount,Name, Purpose, and Authorization 2
Section 4. Date, Denomination, Maturities, Numbers, and Interest 2
Section 5. Redemption. 4
(a) Right of Redemption 4
(b) Notice of Redemption to Bondholder 4
(c) Effect of Redemption 5
(d) Conditional Notice of Redemption 5
Section 6. Characteristics of the Bonds 5
(a) Registration, Transfer, Conversion and Exchange; Authentication 5
(b) Payment of Principal and Interest 6
(c) In General 6
(d) Substitute Paying Agent/Registrar 7
(e) Book-Entry-Only-System 7
(f) Successor Securities Depository; Transfer Outside Book-Entry-
Only System 8
(g) Payments to Cede&Co 8
(h) DTC Blanket Letter of Representations 8
(i) Cancellation of Initial Bond 8
Section 7. Form of Bond 9
Section 8. Tax Levy 18
Section 9. Defeasance of Bonds 19
Section 10. Damaged, Mutilated, Lost, Stolen, or Destroyed Bonds 20
(a) Replacement Bonds 20
(b)Application for Replacement Bonds 20
(c)No Default Occurred 20
(d) Charge for Issuing Replacement Bonds 20
(e) Authority for Issuing Replacement Bonds 21
Section 11. Custody, Approval, and Registration of Bond; Bond Counsel's
Opinion 21
Section 12. Covenants Regarding Tax Exemption of Interest on the Bond 21
(a) Covenants 21
(b) Rebate fund 22
(c) Proceeds 23
(d) Disposition of Project 23
(e) Designation as Qualified Tax-Exempt Obligation 23
Section 13. Approval of Offering Documents, Paying Agent/Registrar Agreement
and Escrow Agreement 24
HUNTSVILLFGORB12012 Ordinance
Section 14. Control and Delivery of Bonds 24
Section 15. Approval of Official Statement 25
Section 16. Insurance Provisions 25
Section 17. Continuing Disclosure 25
(a)Annual Reports 25
(b) Event Notices 26
(c) Limitations, Disclaimers, and Amendments 27
Section 18. Amendment of Ordinance 28
Section 19. Remedies in Event of Default 29
Section 20 No Recourse Against City Officials 30
Section 21. Further Actions 30
Section 22. Perfection 30
Section 23. Interpretations 31
Section 24. Inconsistent Provisions 31
Section 25, Interested Parties 31
Section 26. Severability 31
Section 27. Funds and Accounts 31
Section 28. Repealer 31
Section 29. Effective Date 32
Section 30. Payment of Attorney General Fee 32
Exhibit "A" Definitions
Exhibit "B" Continuing Disclosure
HUNTSVILLE GORB 20 i 2 Ordinance
ORDINANCE NO. 2012-31
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF HUNTSVILLE, TEXAS
GENERAL OBLIGATION REFUNDING BONDS, SERIES 2012; APPROVING AN
OFFICIAL STATEMENT; AUTHORIZING EXECUTION OF A PAYING
AGENT/REGISTRAR AGREEMENT,A BOND PURCHASE AGREEMENT AND AN
ESCROW AGREEMENT; ESTABLISHING PROCEDURES FOR SELLING AND
DELIVERING THE BONDS; AND AUTHORIZING OTHER MATTERS RELATING
TO THE BONDS
MIMINEi■■iM■■■■Im■I■
THE STATE OF TEXAS
COUNTY OF WALKER
CITY OF HUNTSVILLE
WHEREAS,the City of Huntsville,Texas(the"City")has previously issued several series of
obligations payable from ad valorem taxes and waterworks and sewer revenue bonds; and
WHEREAS, the City Council of the City deems it advisable and in the best interest of the
City to refund the Refunded Obligations, as defined in Exhibit "A" attached hereto, in order to
achieve a net present value debt service savings of not less than 4%of the principal amount of the
Refunded Obligations net of any City contribution with such savings,among other information and
terms to be included in a pricing certificate to be executed by the City Manager, acting as the
designated pricing officer of the City, or, in the absence of the City Manager, the City's Finance
Director, all in accordance with the provisions of Chapter 1207, including 1207.007 thereof; and
WHEREAS, Chapter 1207, Texas Government Code, as amended ("Chapter 1207")
authorizes the City to issue refunding bonds and to deposit the proceeds from the sale thereof
together with any other available funds or resources,directly with a place of payment(paying agent)
for the Refunded Obligations or with a trust company or commercial bank that does not act as
depository for the City, and such deposit, if made before such payment dates, shall constitute the
making of fiutii banking and financial arrangements for the discharge and final payment of the
Refunded Obligations; and
WHEREAS, Chapter 1207 further authorizes the City to enter into an escrow agreement
with a paying agent for the Refunded Obligations or with a trust company or commercial bank that
does not act as depository for the City with respect to the safekeeping, investment, reinvestment,
administration and disposition of any such deposit,upon such terms and conditions as the City and
such escrow agent may agree, provided that such deposits may be invested and reinvested in
Defeasance Securities, as defined herein; and
WHEREAS,the Escrow Agreement hereinafter authorized,constitutes an agreement of the
kind authorized and permitted by said Chapter 1207; and
HUNTSVILLE\GORB\2012 Ordinance
WHEREAS, all the Refunded Obligations mature or are subject to redemption prior to
maturity within 20 years of the date of the bonds hereinafter authorized: and
WHEREAS,the Bonds authorized by this Ordinance are being issued and delivered pursuant
to Chapter 1207 of the Texas Government Code, as amended, and other applicable laws: and
WHEREAS, it is hereby officially found and determined that the meeting at which this
Ordinance was passed was open to the public,and public notice of the time,place and purpose of the
meeting was given, all as required by Chapter 551, Texas Government Code.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF
HUNTSVILLE,TEXAS:
Section 1. RECITALS. The recitals set forth in the preamble hereof are incorporated
herein and shall have the same force and effect as if set forth in this Section.
Section 2. DEFINITIONS. For all purposes of this Ordinance, except as otherwise
expressly provided or unless the context otherwise requires,the terms defined in Exhibit"A"to this
Ordinance have the meanings assigned to them in Exhibit "A".
Section 3. AMOUNT,NAME,PURPOSE,AND AUTHORIZATION. The Bonds,
each to be designated the "CITY OF HUNTSVILLE, TEXAS GENERAL OBLIGATION
REFUNDING BOND, SERIES 2012", is hereby authorized to be issued and delivered in
accordance with the Constitution and laws of the State of Texas,particularly Chapter 1207, Texas
Government Code,as amended. The Bonds shall be issued in the aggregate principal amount not to
exceed $10,000,000 for the purpose of providing funds for(i)refunding the Refunded Obligations
and (ii)paying the costs of issuing the Bonds.
Section 4. DATE, DENOMINATION, MATURITIES, NUMBERS, AND
INTEREST. (a) Initially there shall be issued, sold,and delivered hereunder fully registered bonds,
without interest coupons, which may be in the form of Current Interest Bonds or Premium
Compound Interest Bonds,numbered consecutively from R-1 upward,in the case of Current Interest
Bonds,and from PC-1 upward,in the case of Premium Compound Interest Bonds(except the Initial
Bond delivered to the Attorney General of the State of Texas which shall be numbered T-1 and TPC-
1 respectively) payable to the respective initial Owners thereof, or to the registered assignee or
assignees of said Bonds or any portion or portions thereof,in Authorized Denominations,maturing
not later than August 15, 2024, serially or otherwise on the dates, in the years and in the principal
amounts, respectively, and dated, as all set forth in the Pricing Certificate to be executed and
delivered by the Pricing Officer pursuant to subsection(b)of this section. The Pricing Certificate is
hereby incorporated in and made a part of this Ordinance. The authority of the Pricing Officer to
execute a Pricing Certificate shall expire at 5:00 p.m. C.D.T. on December 19,2012. Bonds priced
on or before December 19, 2012 may be delivered to the Purchasers after such date.
(b) As authorized by Chapter 1207, Texas Government Code, as amended, the Pricing
Officer is hereby authorized to act on behalf of the City in selling and delivering the Bonds,
HUNTSVILLE\GORB\2012 Ordinance 2
determining which of the Refundable Obligations shall be refunded and constitute Refunded
Obligations under this Ordinance and carrying out the other procedures specified in this Ordinance,
including determining the date of the Bonds,any additional or different designation or title by which
the Bonds shall be known,the purposes of the Bonds,the price at which the Bonds will be sold,the
years in which the Bonds will mature, the principal amount to mature in each of such years, the
aggregate principal amount of Current Interest Bonds and Premium Compound Interest Bonds,the
rate or rates of interest to be borne by each such maturity, the interest payment periods, the dates,
price,and terms upon and at which the Bonds shall be subject to redemption prior to maturity at the
option of the City, as well as any mandatory sinking fund redemption provisions, and all other
matters relating to the issuance, sale, and delivery of the Bonds and the refunding of the Refunded
Obligations,all of which shall be specified in the Pricing Certificate;provided that(i)the price to be
paid for the Bonds shall not be less than 90%of the aggregate original principal amount thereof plus
accrued interest thereon from its date to its delivery, (ii) none of the Bonds shall bear interest at a
rate, or yield in the case of Premium Compound Interest Bonds, greater than the maximum
authorized by law,(iii)the refunding must produce a net present value debt service savings of at least
4% of the principal amount of the Refunded Obligations, net of any City contribution and(iv) the
Bonds shall be rated by a nationally recognized rating agency in one of the four higher rating
categories. In establishing the aggregate principal amount of the Bonds, the Pricing Officer shall
establish an amount not to exceed the amount authorized in Section 3, which shall be sufficient to
provide for the purposes for which the Bonds are authorized and to pay the costs of issuing the
Bonds.
(c) To achieve advantageous borrowing costs for the City, the Bonds shall be sold on a
negotiated, placement or competitive basis as determined by the Pricing Officer in the Pricing
Certificate. In determining whether to sell the Bonds by negotiated,placement or competitive sale,
the Pricing Officer shall take into account any material disclosure issues which might exist at the
time, the market conditions expected at the time of the sale and any other matters which, in the
judgment of the Pricing Officer, might affect the net borrowing costs on the Bonds.
If the Pricing Officer determines that the Bonds should be sold at a competitive sale, the
Pricing Officer shall cause to be prepared a notice of sale and official statement in such manner as
the Pricing Officer deems appropriate,to make the notice of sale and official statement available to
those institutions and firms wishing to submit a bid for the Bonds,to receive such bids,and to award
the sale of the Bonds to the bidder submitting the best bid in accordance with the provisions of the
notice of sale.
If the Pricing Officer determines that the Bonds should be sold by a negotiated sale or
placement, the Pricing Officer shall designate the placement purchaser or the senior managing
underwriter for the Bonds and such additional investment banking firms as the Pricing Officer deems
appropriate to assure that the Bonds are sold on the most advantageous terms to the City. The
Pricing Officer,acting for and on behalf of the City,is authorized to enter into and carry out a bond
purchase agreement or other agreement for the Bonds to be sold by negotiated sale or placement,
with the underwriters or placement purchasers at such price, with and subject to such tenns as
determined by the Pricing Officer pursuant to Section 4(b)above. Each bond purchase agreement or
other agreement shall be substantially in the form and substance previously approved by the City in
HUNTSVILLE\GORB\2012 Ordinance 3
connection with the authorization of ad valorem tax debt with such changes as are acceptable to the
Pricing Officer.
In satisfaction of Section 1201.022(a)(3), Texas Government Code, the City hereby
determines that the delegation of the authority to the Pricing Officer to approve the final terms and
conditions of the Bonds as set forth in this Ordinance and the decisions made by the Pricing Officer
pursuant to such delegated authority and incorporated in the Pricing Certificate will be, in the best
interests and shall have the same force and effect as if such determination were made by the Pricing
Officer and the Pricing Officer is hereby authorized to make and include in the Pricing Certificate an
appropriate finding to that effect.
(d) The Current Interest Bonds shall bear interest calculated on the basis of a 360-day
year composed of twelve 30-day months from the dates specified in the FORM OF BONDS set forth
in this Ordinance to their respective dates of maturity or redemption at the rates per annum set forth
in the Pricing Certificate.
The Premium Compound Interest Bonds shall bear interest from the Original Issue Date,
calculated on the basis of a 360-day year composed of twelve 30-day months(subject to rounding to
the Compounded Amounts thereof), compounded on the Compounding Dates as set forth in the
Pricing Certificate,and payable,together with the principal amount thereof,in the manner provided
in the Form of Bonds at the rates set forth in the Pricing Certificate. Attached to the Pricing
Certificate,if Premium Compound Interest Bonds are to be issued,shall be the Accretion Table. The
Accreted Value with respect to any date other than a Compounding Date is the amount set forth on
the Accretion Table with respect to the last preceding Compounding Date, plus the portion of the
difference between such amount and the amount set forth on the Accretion Table with respect to the
next succeeding Compounding Date that the number of days (based on 30-day months) from such
last preceding Compounding Date to the date for which such determination is being calculated bears
to the total number of days(based on 30-day months)from such last preceding Compounding Date
to the next succeeding Compounding Date.
Section 5. REDEMPTION. (a) Right of Redemption. The City reserves the right,at its
option, to redeem the Bonds as set forth in the FORM OF BOND and the Pricing Certificate. The
City, at least thirty (30) days before the date of any optional redemption, shall notify the Paying
Agent/Registrar of such redemption date and of the amount and maturity of the Bonds to be
redeemed.
(b) Notice of Redemption to Bondholder. The Paying Agent/Registrar shall give notice
of any redemption of the Bonds by sending notice by first class United States mail,postage prepaid,
not less than twenty(20)days before the date fixed for redemption,to the Bondholder at the address
shown in the Register. The notice shall state among other things, the redemption date, the
redemption price,the place at which the Bonds are to be surrendered for payment,and that the Bonds
so called for redemption shall cease to bear interest after the redemption date. Any notice given as
provided in this Section shall be conclusively presumed to have been duly given,whether or not the
Bondholder receives such notice.
HUNTSVILLE\GORB 2012 Ordnance 4
(c) Effect of Redemption. Notice of redemption having been given as provided in this
Section, the Bonds called for redemption shall become due and payable on the date fixed for
redemption and, unless the City defaults in the payment of the principal thereof or accrued interest
thereon,such Bonds thereof shall cease to bear interest from and after the date fixed for redemption,
whether or not such Bond is presented and surrendered for payment on such date. If the Bonds
thereof called for redemption are not so paid upon presentation and surrender thereof for redemption,
such Bonds thereof shall continue to bear interest at the rate stated on the Bond until paid or until due
provision is made for the payment of same.
(d) Conditional Notice of Redemption. With respect to any optional redemption of the
Bonds,unless certain prerequisites to such redemption required by this Ordinance have been met and
moneys sufficient to pay the principal of and premium, if any, and interest on the Bonds to be
redeemed shall have been received by the Paying Agent/Registrar prior to the giving of such notice
of redemption, such notice shall state that said redemption may, at the option of the City, be
conditional upon the satisfaction of such prerequisites and receipt of such moneys by the Paying
Agent/Registrar on or prior to the date fixed for such redemption,or upon any and such prerequisites
to the redemption and sufficient moneys are not received,such notice shall be of no force and effect,
the City shall not redeem such Bonds and the Paying Agent/Registrar shall give notice,in the manner
in which the notice of redemption was given, to the effect that the Bonds have not been redeemed.
Section 6. CHARACTERISTICS OF THE BONDS. (a) Registration, Transfer..
Conversion and Exchange;Authentication. The City shall keep or cause to be kept at Wells Fargo
N.A.,Fort Worth,Texas(the"Paying Agent/Registrar")books or records for the registration of the
transfer, conversion and exchange of the Bonds (the "Register"), and the City hereby appoints the
Paying Agent/Registrar as its registrar and transfer agent to keep such Bonds or records and make
such registrations of transfers,conversions and exchanges under such reasonable regulations as the
City and Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such -
registrations, transfers, conversions and exchanges as herein provided within three days of
presentation in due and proper form. The Paying Agent/Registrar shall obtain and record in the
Register the address of the Registered Owner of each Bond to which payments with respect to the
Bond shall be mailed,as herein provided;but it shall be the duty of each Registered Owner to notify
the Paying Agent/Registrar in writing of the address to which payments shall be mailed, and such
interest payments shall not be mailed unless such notice has been given. The City shall have the
right to inspect the Register during regular business hours of the Paying Agent/Registrar, but
otherwise the Paying Agent/Registrar shall keep the Register confidential and, unless otherwise
required by law, shall not permit their inspection by any other entity. The Paying Agent/Registrar
shall make a copy of the Register available in the State of Texas. The City shall pay the Paying
Agent/Registrar's standard or customary fees and charges for making such registration, transfer,
conversion, exchange and delivery of a substitute Bond. Registration of assignments, transfers,
conversions and exchanges of Bonds shall be made in the manner provided and with the effect stated
in the FORM OF BOND set forth in this Ordinance. Each substitute Bond shall bear a letter and/or
number to distinguish it from each other Bond.
HUNTSVILLE\GOREP2012 Ordinance 5
Except as provided in subsection (c) hereof, an authorized representative of the Paying
Agent/Registrar shall,before the delivery of any such Bond,date and manually sign the Bond,and no
such Bond shall be deemed to be issued or outstanding unless such Bond is so executed. The Paying
Agent/Registrar promptly shall cancel all paid Bonds and Bonds surrendered for conversion and
exchange. No additional ordinances, orders, or resolutions need be passed or adopted by the City
Council or any other body or person so as to accomplish the foregoing conversion and exchange of
any Bond or portion thereof,and the Paying Agent/Registrar shall provide for the printing,execution,
and delivery of the substitute Bond in the manner prescribed herein, and the Bonds shall be
typewritten,photocopied,printed,lithographed,engraved or produced in any other similar manner,
all as determined by the officers executing such bond as evidenced by their execution thereof.
Pursuant to Chapter 1201, Texas Government Code, as amended, and particularly Subchapter D
thereof, the duty of conversion and exchange of Bonds as aforesaid is hereby imposed upon the
Paying Agent/Registrar, and,upon the execution of the Bonds,the converted and exchanged Bond
shall be valid, incontestable, and enforceable in the same manner and with the same effect as the
Bond which initially was issued and delivered pursuant to this Ordinance,approved by the Attorney
General, and registered by the Comptroller of Public Accounts.
(b) Payment of Principal and Interest. The City hereby further appoints the Paying
Agent/Registrar to act as the paying agent for paying the principal of and interest on the Bond,all as
provided in this Ordinance and in the Pricing Certificate. The Paying Agent/Registrar shall keep
proper records of all payments made by the City and the Paying Agent/Registrar with respect to the
Bond,and of all conversions and exchanges of Bonds,and all replacements of Bonds,as provided in
this Ordinance. However,in the event of a nonpayment 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 from the City. 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 Registered Owner appearing on the Register at the close of
business on the last Business Day next preceding the date of mailing of such notice
(c) In General. The Bonds (i) shall be issued in fully registered form, without interest
coupons, with the principal of and interest on such Bonds to be payable only to the Registered
Owner,(ii)may be transferred and assigned,(iii)may be converted and exchanged for another Bond,
(iv) shall have the characteristics, (v)shall be signed, sealed, executed and authenticated,(vi) shall ,?`!
be payable as to principal and interest and(vii)shall be administered and the Paying Agent/Registrar
and the City shall have certain duties and responsibilities with respect to the Bonds,all as provided,
in the manner and to the effect as required or indicated,in the Pricing Certificate and the FORM
OF BOND set forth in this Ordinance. The Bonds initially issued and delivered pursuant to this
Ordinance are not required to be,and shall not be, authenticated by the Paying Agent/Registrar,but
on each substitute Bond issued in exchange for any Bond issued under this Ordinance the Paying
Agent/Registrar shall execute the PAYING AGENT/REGISTRAR'S AUTHENTICATION
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CERTIFICATE,in the form set forth in the FORM OF BOND. On the closing date,the initial Bond
representing the entire principal amount of the Bonds, payable to the underwriter, executed by
manual or facsimile signature of the Mayor and City Secretary,approved by the Attorney General of
HUNTS V ILLEAGORB\2012:Ordinance 6
vimoimis
Texas, and registered and manually signed by the Comptroller of Public Accounts of the State of
Texas,and with the date of delivery inserted thereon by the Paying Agent/Registrar,will be delivered
to the underwriter.
(d) Substitute Paying Agent/Registrar. The City covenants with the Registered Owners
of the Bonds that at all times while the Bonds are outstanding the City will provide a competent and
legally qualified bank,trust company,financial institution,or other agency to act as and perform the
services of Paying Agent/Registrar for the Bonds under this Ordinance, and that the Paying
Agent/Registrar will be one entity. The City reserves the right to,and may,at its option,change the
Paying Agent/Registrar upon not less than 30 days written notice to the Paying Agent/Registrar,to be
effective at such time which will not disrupt or delay payment on the next principal or interest
payment date after such notice. In the event that the entity at any time acting as Paying
Agent/Registrar(or its successor by merger,acquisition,or other method)should resign or otherwise
cease to act as such, the City covenants that promptly it will appoint a competent and legally
qualified bank,trust company,financial institution,or other agency to act as Paying Agent/Registrar
under this Ordinance. Upon any change in the Paying Agent/Registrar, the previous Paying
Agent/Registrar promptly shall transfer and deliver the Register(or a copy thereof), along with all
other pertinent Bonds and records relating to the Bonds, to the new Paying Agent/Registrar
designated and appointed by the City. Upon any change in the Paying Agent/Registrar, the City
promptly will cause a written notice thereof to be sent by the new Paying Agent/Registrar to each
Registered Owner of the Bonds,by United States mail,first-class postage prepaid,which notice also
shall give the address of the new Paying Agent/Registrar. By accepting the position and performing
as such, each Paying Agent/Registrar shall be deemed to have agreed to the provisions of this
Ordinance,and a certified copy of this Ordinance shall be delivered to each Paying Agent/Registrar.
(e) Book-Entry-Only System. The Bonds issued in exchange for the Bonds initially
issued as provided in Section 6 (i) shall be issued in the form of a separate single fully registered
Bond for each of the maturities thereof registered in the name of Cede & Co., as nominee of the
Depository Trust Company of New York("DTC") and except as provided in subsection(f)hereof,
all of the outstanding Bonds shall be registered in the name of Cede& Co., as nominee of DTC.
With respect to Bonds registered in the name of Cede& Co., as nominee of DTC, the City
and the Paying Agent/Registrar shall have no responsibility or obligation to any securities brokers
and dealers,banks,trust companies,clearing corporations and certain other organizations on whose
behalf DTC was created to hold securities to facilitate the clearance and settlement of securities
transactions among DTC participants(the "DTC Participant") or to any person on behalf of whom
such a DTC Participant holds an interest in the Bonds. Without limiting the immediately preceding
sentence, the City and the Paying Agent/Registrar shall have no responsibility or obligation with
respect to(i)the accuracy of the records of DTC,Cede&Co.or any DTC Participant with respect to
any ownership interest in the Bonds, (ii) the delivery to any DTC Participant or any other person,
other than a Registered Owner,as shown on the Registration Books,of any notice with respect to the
Bonds,or(iii)the payment to any DTC Participant or any person,other than a Registered Owner,as
shown in the Registration Books of any amount with respect to principal of or interest on the Bonds.
Notwithstanding any other provision of this Ordinance to the contrary,but to the extent permitted by
law,the City and the Paying Agent/Registrar shall be entitled to treat and consider the person whose
HUNTSVILLE\GORBOOI 2 Ordinance 7
name each Bond is registered in the registration Books as the absolute owner of such Bond for the
purpose of payment of principal of and interest, with respect to such Bond, for the purposes of
registering transfers with respect to such Bond, and for all other purposes of registering transfers
with respect to such Bonds,and for all other purposes whatsoever. The Paying Agent/Registrar shall
pay all principal of and interest on the Bonds only to or upon the order of the respective Registered
Owners, as shown in the Registration Books as provided in this Ordinance, or their respective
attorneys duly authorized in writing, and all such payments shall be valid and effective to fully
satisfy and discharge the City's obligations with respect to payment of principal of and interest on the
Bonds to the extent of the sum or sums so paid. No person other than a Registered Owner,as shown
in the Registration Books, shall receive a Bond evidencing the obligation of the City to make
payments of principal,and interest pursuant to this Ordinance. Upon delivery by DTC to the Paying
Agent/Registrar of written notice to the effect that DTC has determined to substitute a new nominee
in place of Cede & Co., and subject to the provisions in this Ordinance with respect to interest
checks being mailed to the registered owner at the close of business on the Record Date the word
"Cede& Co." in this Ordinance shall refer to such new nominee of DTC.
(f) Successor Securities Depository-,Transfer Outside Book-Entry-Only System. In the
event that the City determines to discontinue the book-entry system through DTC or a successor or
DTC determines to discontinue providing its services with respect to the Bonds,the City shall either
(i) appoint a successor securities depository, qualified to act as such under Section 17(a) of the
Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants of the
availability through DTC of Bonds and transfer one or more separate Bonds to DTC Participants
having Bonds credited to their DTC accounts. In such event,the Bonds shall no longer be restricted
to being registered in the Registration Books in the name of Cede& Co., as nominee of DTC, but
shall be registered in the name of the successor securities depository,or its nominee,or in whatever
name or names the Registered Owner transferring or exchanging Bonds shall designate, in
accordance with the provisions of this Ordinance.
(g) Payments to Cede&Co. Notwithstanding any other provision of this Ordinance to
the contrary, so long as any Bond is registered in the name of Cede&Co., as nominee of DTC, all
payments with respect to principal of,and interest on such Bond and all notices with respect to such
Bond shall be made and given,respectively,in the manner provided in the Letter of Representations
of the City to DTC.
(h) DTC Blanket Letter of Representations. The City confirms execution of a Blanket
Letter of Representations with DTC establishing the Book-Entry-Only System which will be utilized
with respect to the Bonds.
(i) Cancellation of Initial Bond. On the Closing Date,one initial Bond representing the
entire principal amount of the Bonds,payable in stated installments to the order of the underwriter of
the Bonds or its designee, executed by manual or facsimile signature of the Mayor and City
Secretary, approved by the Attorney General of Texas, and registered and manually signed by the
Comptroller of Public Accounts of the State of Texas, will be delivered to such underwriter or its
designee. Upon payment for the initial Bond, the Paying Agent/Registrar shall cancel the initial
Bond and deliver to DTC or the Paying Agent/Registrar on behalf of such underwriter one registered
HUNTSVILLE\GOR1312012 Ordinance 8
11111111110111111111111
definitive Bond for each year of maturity of the Bonds, in the aggregate principal amount of all the
Bonds for such maturity.
Section 7. FORM OF BOND. The form of the Bonds, including the form of Paying
Agent/Registrar's Authentication Certificate,the form of Assignment,and the form of Registration
Certificate of the Comptroller of Public Accounts of the State of Texas to be attached to the Bonds
initially issued and delivered pursuant to this Ordinance shall be, respectively, substantially as
follows,with such appropriate variations,omissions,or insertions as are permitted or required by this
Ordinance.
FORM OF BOND
(All blanks and any appropriate or necessary insertions or deletions, to be completed as
determined by the Pricing Officer in the Pricing Certificate)
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF HUNTSVILLE,TEXAS
GENERAL OBLIGATION
REVENUE REFUNDING BOND, SERIES 2012
PRINCIPAL
R- AMOUNT
[FORM OF FIRST PARAGRAPHS OF CURRENT INTEREST BONDS]
INTEREST RATE MATURITY DATE DATE OF BOND CUSIP NO
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
ON THE MATURITY DATE specified above, the CITY OF HUNTSVILLE, TEXAS
(the "City"), being a political subdivision and municipal corporation of the State of Texas,hereby
promises to pay to the Registered Owner specified above,or registered assigns(hereinafter called the
"Registered Owner"),the Principal Amount specified above,and to pay interest thereon(calculated
on the basis of a 360-day year of twelve 30-day months) from at the Interest
*As provided in the Pricing Certificate. To the extent that the Pricing Certificate relating to the Bonds is inconsistent with any provisions in this Fonn of
Bond or contains information to complete missing information in this Form of Bond,the language in the Pricing Certificate shall be used in the executed
Bonds.
HUNTSVILLE GORB 2012 Ordinance 9
Rate per annum specified above, payable on , and semiannually on each
and thereafter to the Maturity Date specified above, or the date of
redemption prior to maturity; except that if this Bond is required to be authenticated and the date of
its authentication is later than the first Record Date (hereinafter defined), such Principal Amount
shall bear interest from the interest payment date next preceding the date of authentication, unless
such date of authentication is after any Record Date but on or before the next following interest
payment date, in which case such principal amount shall bear interest from such next following
interest payment date;provided,however,that if on the date of authentication hereof the interest on
the Bond or Bonds,if any,for which this Bond is being exchanged is due but has not been paid,then
this Bond shall bear interest from the date to which such interest has been paid in full.
Notwithstanding the foregoing, during any period in which ownership of the Bonds is determined
only by a book entry at a securities depository for the Bonds, any payment to the securities
depository, or its nominee or registered assigns, shall be made in accordance with existing
arrangements between the City and the securities depository.
THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the
United States of America,without exchange or collection charges. The principal of this Bond shall
be paid to the Registered Owner hereof upon presentation and surrender of this Bond at maturity or
upon the date fixed for its redemption prior to maturity, at the designated office for payment of
* which is the "Paying Agent/Registrar" for this Bond. The payment of
interest on this Bond shall be made by the Paying Agent/Registrar to the Registered Owner hereof on
each interest payment date by check, dated as of such interest payment date, drawn by the Paying
Agent/Registrar on,and payable solely from,funds of the City required by the Ordinance authorizing
the issuance of this Bond(the"Bond Ordinance")to be on deposit with the Paying Agent/Registrar
for such purpose as hereinafter provided;and such check shall be sent by the Paying Agent/Registrar
by United States mail, first-class postage prepaid, on each such interest payment date, to the
Registered Owner hereof, at its address as it appeared on the last business day of the month next
preceding each such date (the "Record Date") on the Registration Books kept by the Paying
Agent/Registrar, as hereinafter described. In the event of a non-payment of interest on a scheduled
payment date, and for 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 from the City. Notice of the Special Record Date and of the
scheduled payment date of the past due interest(the"Special Payment Date"which shall be 15 days
after the Special Record Date) shall be sent at least five business days prior to the Special Record
Date by United States mail, first class, postage prepaid, to the address of each Registered Owner
appearing on the Registration Books of the Paying Agent/Registrar at the close of business on the
last business day next preceding the date of mailing of such notice. Any accrued interest due upon
the redemption of this Bond prior to maturity as provided herein shall be paid to the Registered
Owner upon presentation and surrender of this Bond for redemption and payment at the principal
office for payment of the Paying Agent/Registrar(unless the redemption date is a regularly scheduled
interest payment date,in which case accrued interest on such redeemed Bonds shall be payable in the
regular manner described above). The City covenants with the Registered Owner of this Bond that
on or before each principal payment date,interest payment date, and accrued interest payment date
for this Bond it will make available to the Paying Agent/Registrar, from the "Interest and Sinking
Fund"referred to in and maintained by the Bond Ordinance,the amounts required to provide for the
HUNTSVILLE\GORB120 12 Ordnance 10
payment, in immediately available funds, of all principal of and interest on the Bonds, when due.
Terms used in this Bond and not otherwise defined shall have the meaning given in the Bond
Ordinance.
DURING ANY PERIOD in which ownership of the Bonds is determined only by a book
entry at a securities depository for the Bonds,if fewer than all of the Bonds of the same maturity and
bearing the same interest rate are to be redeemed,the particular Bonds of such maturity and bearing
such interest rate shall be selected in accordance with the arrangements between the City and the
securities depository.
[FORM OF FIRST PARAGRAPHS
OF PREMIUM COMPOUND INTEREST BOND]
NO. PC- MATURITY
AMOUNT
INTEREST RATE MATURITY DATE ISSUANCE DATE C USI P NO.
REGISTERED OWNER:
MATURITY AMOUNT:
ON THE MATURITY DATE SPECIFIED ABOVE,CITY OF HUNTSVILLE,TEXAS
(the "City"), being a political subdivision and municipal corporation of the State of Texas, hereby
promises to pay to the Registered Owner set forth above,or registered assigns(hereinafter called the
"Registered Owner")the Maturity Amount set forth above,representing the principal amount hereof
and accrued and compounded interest hereon. Interest shall accrue on the principal amount hereof
from the Issuance Date at the interest rate per annum specified above, calculated on the basis of a
360 day year comprised of twelve 30 day months, compounded semiannually on and
*of each year commencing . For convenience of reference a table
of the "Accreted Value" per $5,000 Maturity Amount is printed on the reverse side of this Bond.
The term"Accreted Value"as set forth in the table on the reverse side hereof shall mean the original
principal amount plus initial premium per$5,000 Maturity Amount compounded semiannually on
* and at the yield shown on such table.
THE MATURITY AMOUNT of this Bond is payable in lawful money of the United States
of America, without exchange or collection charges. The Maturity Amount of this Bond shall be
paid to the Registered Owner hereof upon presentation and surrender of this Bond at maturity,at the
*As provided in the Pricing Certificate. To the extent that the Pricing Certificate relating to the Bonds is inconsistent with any provisions in this Form of
Bond or contains information to complete missing information in this Form of Bond,the language in the Pricing Certificate shall be used m the executed
Bonds.
HUNTSVILLE\GORB,2012 Ordinance 11
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designated office for payment of *,which is the"Paying Agent/Registrar"for
this Bond, and shall be drawn by the Paying Agent/Registrar on, and solely from, funds of the City
required by the ordinance authorizing the issuance of the Bonds (the "Bond Ordinance") to be on
deposit with the Paying Agent/Registrar for such purpose as hereinafter provided, payable to the
Registered Owner hereof, as it appears on the Registration Books kept by the Paying
Agent/Registrar, as hereinafter described. The City covenants with the Registered Owner of this
Bond that on or before the Maturity Date for this Bond it will make available to the Paying
Agent/Registrar,from the"Interest and Sinking Fund"created by the Bond Ordinance,the amounts
required to provide for the payment,in immediately available funds of the Maturity Amount,when
due. Notwithstanding the foregoing, during any period in which ownership of the Bonds is
determined only by a book entry at a securities depository for the Bonds, any payment to the
securities depository,or its nominee or registered assigns,shall be made in accordance with existing
arrangements between the City and the securities depository.
[FORM OF REMAINDER OF EACH BOND]
IF THE DATE for the payment of the principal of or interest on this Bond shall be a
Saturday, Sunday,legal holiday,or day on which banking institutions in the city where the principal
office for payment of the Paying Agent/Registrar is located are authorized by law or executive order
to close, or the United States Postal Service is not open for business(each a "Non-Business Day"),
then the date for such payment shall be the next succeeding day which is not a Non-Business Day,
and payment on such date shall have the same force and effect as if made on the original date
payment was due.
THIS BOND is one of a series of Bonds dated as of *and authorized to
be issued pursuant to the Bond Ordinance adopted by the City Council of the City in the principal
amount of [constituting$ Current Interest Bonds and$ Premium
Compound Interest Bonds]..*
ON * OR ON ANY DATE THEREAFTER, the Bonds maturing on and after
* may be redeemed prior to their scheduled maturities, at the option of the City, with
funds derived from any available and lawful source, at a redemption price equal to the principal
amount to be redeemed plus accrued interest to the date fixed for redemption as a whole, or from
time to time in part,and,if in part,the particular Bonds,or portions thereof,to be redeemed shall be
selected and designated by the City, and if less than all of a maturity is to be redeemed the Paying
Agent/Registrar shall determine by lot the Bonds, or portions thereof within such maturity to be
redeemed(provided that a portion of a Bond may be redeemed only in integral multiples of$5,000 of
principal amount).
*As provided in the Pricing Certificate. To the extent that the Pricing Certificate relating to the Bonds is inconsistent with any provisions in this Form of
Bond or contains information to complete missing information in this Form of Bond,the language in the Pricing Certificate shall be used in the executed
Bonds.
**To be included only if Current Interest Bonds and Premium Compound Interest Bonds are both issued and completed as determined in the Pricing
Certificate.
HUNTSVILLE\GORB\2012 Ordnance 12
[THE BONDS MATURING ON are subject to mandatory sinking fund
redemption by lot prior to maturity in the following amounts on the following dates and at a price of
par plus accrued interest to the redemption date ("Term Bonds").
Term Bonds Maturing , 20
Redemption Date Principal Amount
, 20
, 20 H
"Final Maturity
THE PRINCIPAL AMOUNT of the Term Bonds required to be redeemed pursuant to the
operation of the mandatory sinking fund redemption provisions shall be reduced,at the option of the
City by the principal amount of any Term Bonds of the stated maturity which, at least 50 days prior
to a mandatory redemption date,(I)shall have been acquired by the City at a price not exceeding the
principal amount of such Term Bonds plus accrued interest to the date of purchase thereof, and
delivered to the Paying Agent/Registrar for cancellation,(2)shall have been purchased and canceled
by the Paying Agent/Registrar at the request of the City with monies in the Interest and Sinking Fund
at a price not exceeding the principal amount of the Term Bonds plus accrued interest to the date of
purchase thereof,or(3)shall have been redeemed pursuant to the optional redemption provisions and
not theretofore credited against a mandatory sinking fund redemption requirement l*
AT LEAST 20 days prior to the date fixed for any redemption of Bonds or portions thereof
prior to maturity,a written notice of such redemption shall be sent by the Paying Agent/Registrar by
United States mail,first-class postage prepaid,to the Registered Owner of each Bond to be redeemed
at its address as it appeared on the Registration Books maintained by the Paying Agent/Registrar on
the day such notice of redemption is mailed. By the date fixed for any such redemption, due
provision shall be made with the Paying Agent/Registrar for the payment of the required redemption
price for the Bonds or portions thereof which are to be so redeemed. If such written notice of
redemption is mailed and if due provision for such payment is made, all as provided above, the
Bonds or portions thereof which are to be so redeemed thereby automatically shall be treated as
redeemed prior to their scheduled maturities, and they shall not bear interest after the date fixed for
redemption,and they shall not be regarded as being outstanding except for the right of the Registered
Owner to receive the redemption price from the Paying Agent/Registrar out of the funds provided for
such payment. If a portion of any Bond shall be redeemed a substitute Bond or Bonds having the
same maturity date,bearing interest at the same rate, in any denomination or denominations in any
integral multiple of$5,000, at the written request of the Registered Owner, and in an aggregate
principal amount equal to the unredeemed portion thereof, will be issued to the Registered Owner
upon the surrender thereof for cancellation, at the expense of the City, all as provided in the Bond
Ordinance.
***Use of Term Bonds,if any to be determined by the Pricing Officer
HUNTSVILLE\GORB\20 12 Ordnance 13
.........■••••=srmiorramo
ALL BONDS OF THIS SERIES are issuable solely as fully registered Bonds, without
interest coupons, in the denomination of any integral multiple of$5,000 with respect to Current
Interest Bonds and$5,000 maturity amount on any integral multiple thereof with respect to Premium
Compound Interest Bonds (an "Authorized Denomination"). As provided in the Bond Ordinance,
this Bond, or any unredeemed portion hereof, may, at the request of the Registered Owner or the
assignee or assignees hereof,be assigned, transferred and exchanged for a like aggregate principal
amount of fully registered Bonds, without interest coupons, payable to the appropriate Registered
Owner,assignee or assignees, as the case may be,having the same denomination or denominations
in any integral multiple of$5,000 as requested in writing by the appropriate Registered Owner,
assignee or assignees,as the case maybe,upon surrender of this Bond to the Paying Agent/Registrar
for cancellation, all in accordance with the form and procedures set forth in the Bond Ordinance.
Among other requirements for such assignment and transfer, this Bond must be presented and
surrendered to the Paying Agent/Registrar,together with proper instruments of assignment,in form
and with guarantee of signatures satisfactory to the Paying Agent/Registrar,evidencing assignment
of this Bond or any portion or portions hereof in any integral multiple of$5,000 to the assignee or
assignees in whose name or names this Bond or any such portion or portions hereof is or are to be
registered. The form of Assignment printed or endorsed on this Bond may be executed by the
Registered Owner to evidence the assignment hereof, but such method is not exclusive, and other
instruments of assignment satisfactory to the Paying Agent/Registrar may be used to evidence the
assignment of this Bond or any portion or portions hereof from time to time by the Registered
Owner. The Paying Agent/Registrar's reasonable standard or customary fees and charges for
transferring and exchanging any Bond or portion thereof shall be paid by the City,but any taxes or
governmental charges required to be paid with respect thereto shall be paid by the one requesting
such assignment,transfer or exchange as a condition precedent to the exercise of such privilege. The
Paying Agent/Registrar shall not be required to make any such transfer or exchange(i) during the
period commencing with the close of business on any Record Date and ending with the opening of
business on the next following principal or interest payment date,or,(ii)with respect to any Bond or
any portion thereof called for redemption prior to maturity, within 45 days prior to its redemption
date; provided, however, such limitation of transfer shall not be applicable to an exchange by the
Registered Owner of an unredeemed balance of a Bond called for redemption in part.
WHENEVER the beneficial ownership of this Bond is determined by a book entry at a
securities depository for the Bonds,the foregoing requirements of holding,delivering or transferring
this Bond shall be modified to require the appropriate person or entity to meet the requirements of
the securities depository as to registering or transferring the book entry to produce the same effect.
IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the City,resigns
or otherwise ceases to act as such, the City has covenanted in the Bond Ordinance that it promptly
will appoint a competent and legally qualified substitute therefor,and cause written notice thereof to
be mailed to the Registered Owners of the Bonds.
IT IS HEREBY certified, recited and covenanted that this Bond has been duly and validly
authorized, issued and delivered; that all acts, conditions and things required or proper to be
performed,exist,and be done precedent to or in the authorization,issuance and delivery of this Bond
HUNTSVILLE,GORIK 2012 Ordinance 14
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have been performed,existed and been done in accordance with law;that this Bond is payable from
ad valorem taxes, within the limits prescribed by law.
BY BECOMING the Registered Owner of this Bond, the Registered Owner thereby
acknowledges all of the terms and provisions of the Bond Ordinance, agrees to be bound by such
terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for
inspection in the official minutes and records of the governing body of the City and agrees that the
terms and provisions of this Bond and the Bond Ordinance constitute a contract between each
Registered Owner hereof and the City.
IN WITNESS WHEREOF,the City has caused this Bond to be signed with the manual or
facsimile signature of the Mayor of the City, and countersigned with the manual or facsimile
signature of the City Secretary of the City and the official seal of the City has been duly impressed,
or placed in facsimile, on this Bond.
(facsimile signature) (facsimile signature)
City Secretary, City of Huntsville, Texas Mayor, City of Huntsville, Texas
(CITY SEAL)
3
FORM OF REGISTRATION CERTIFICATE
OF THE COMPTROLLER OF PUBLIC ACCOUNTS:
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO
I hereby certify that this Bond has been examined, certified as to validity, and approved by
the Attorney General of the State of Texas,and that this Bond has been registered by the Comptroller ,$
of Public Accounts of the State of Texas.
Witness my signature and seal this
(COMPTROLLER'S SEAL) Comptroller of Public Accounts
of the State of Texas
FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
(To be executed if this Bond is not accompanied by an executed Registration
Certificate of the Comptroller of Public Accounts of the State of Texas)
It is hereby certified that this Bond has been issued under the provisions of the Bond
Ordinance described in the text of this Bond; and that this Bond has been issued in exchange for a
HUNTSVILLE\GORB2012 Ordinance 1 5
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bond or bonds, or a portion of a bond or bonds of a series which originally was approved by the
Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the
State of Texas.
Dated: WELLS FARGO BANK, N.A.
Paying Agent/Registrar
By
Authorized Representative
FORM OF ASSIGNMENT:
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned Registered Owner of this Bond, or duly
authorized representative or attorney thereof; hereby sells, assigns and transfers this Bond and all
rights hereunder unto
/
(Assignee's Social Security or (Please print or typewrite Assignee's name and address,
Taxpayer Identification Number) including zip code)
and hereby irrevocably constitutes and appoints
attorney to transfer the registration of this Bond on the Paying Agent/Registrar's Registration Books
with full power of substitution in the premises.
Dated:
NOTICE: Signature(s)must be guaranteed by a NOTICE:The signature above must correspond
member firm of the New York Stock Exchange with the name of the Registered Owner as it
or a commercial bank or trust company. appears upon the front of this Bond in every
particular,without alteration or enlargement or
any change whatsoever.
INSERTIONS FOR THE INITIAL BONDS
(i) The initial Current Interest Bond shall be in the form set forth in this FORM OF BOND,
except that
A. immediately under the name of the Bond, the headings "INTEREST RATE" and
"MATURITY DATE" shall both be completed with the words "As shown below"
and "CUSIP NO." shall be deleted.
B. the first paragraph shall be deleted and the following will be inserted:
HUNTSVILLE\GOR1312012 Ordinance 16
"ON THE MATURITY DATE SPECIFIED ABOVE,the City of Huntsville,Texas(the
"City"), being a political subdivision, hereby promises to pay to the Registered Owner specified
above, or registered assigns(hereinafter called the"Registered Owner"),on in each of
the years, in the principal installments and bearing interest at the per annum rates set forth in the
following schedule:
Principal Maturity Interest
Amount Date Rate
(Information for the Current Interest Bonds from the Pricing Certificate to be inserted)
The City promises to pay interest on the unpaid principal amount hereof(calculated on the basis of a
360-day year of twelve 30-day months)from at the respective Interest Rate per annum
specified above. Interest is payable on and semiannually on each * and
*thereafter to the date of payment of the principal installment specified above;except,
that if this Bond is required to be authenticated and the date of its authentication is later than the first
Record Date (hereinafter defined), such principal amount shall bear interest from the interest
payment date next preceding the date of authentication,unless such date of authentication is after any
Record Date but on or before the next following interest payment date,in which case such principal
amount shall bear interest from such next following interest payment date;provided,however,that if
on the date of authentication hereof the interest on the Bond or Bonds,if any, for which this Bond is
being exchanged is due but has not been paid, then this Bond shall bear interest from the date to
which such interest has been paid in full."
C. The initial Bond shall be numbered "T-1."
(ii) The Initial Compound Interest Bond shall be in the form set forth in this Section,except that:
A. immediately under the name of the Bond, the headings "INTEREST RATE" and
"MATURITY DATE" shall both be completed with the words "As shown below"
and "CUSIP NO " shall be deleted.
B. the first paragraph shall be deleted and the following will be inserted:
"THE CITY OF HUNTSVILLE,Texas(the"City"),being a political subdivision of the State
of Texas, hereby promises to pay to the Registered Owner set forth above, or registered assigns
(hereinafter called the "Registered Owner") the Payment at Maturity on in each of the
years and in installments of the respective Maturity Amounts set forth in the following schedule:
*As provided in the Pricing Certificate. To the extent that the Pricing Certificate relating to the Bonds is inconsistent with any provisions in this Form
of Bond or contains information to complete missing information in this Form of Bond,the language in the Pricing Certificate shall be used in the
executed Bonds.
*As provided in the Pricing Certificate. To the extent that the Pricing Certificate relating to the Bonds is inconsistent with any provisions in this Form of
Bond or contains information to complete missing information in this Form of Bond,the language in the Pricing Certificate shall be used in the executed
Bonds.
HUNTSVILLE\GORB\2012 Ordinance 17
Maturity Maturity Interest
Amounts Date Rate
(Information for the Premium Compound Interest Bonds from the Pricing Certificate to be inserted)
The amount shown above as the respective Maturity Amounts represent the principal amount hereof
and accrued and compounded interest hereon. Interest shall accrue on the principal amount hereof
from the Issuance Date at the interest rate per annum specified above,compounded semiannually on
* and of each year commencing . For convenience of reference, a
table appears on the back of this Bond showing the"Compounded Amount"of the original principal
amount plus initial premium,if any,per$5,000 Maturity Amount compounded semiannually at the
yield shown on such table."
C. the Initial Premium Compound Interest Bond shall be numbered "TPC-1."
Section 8. TAX LEVY. A special Interest and Sinking Fund(the"Interest and Sinking
Fund")is hereby created solely for the benefit of the Bonds, and the Interest and Sinking Fund shall
be established and maintained by the City at an official depository bank of the City. The Interest and
Sinking Fund shall be kept separate and apart from all other funds and accounts of the City,and shall
be used only for paying the interest on and principal of the Bonds. All ad valorem taxes levied and
collected for and on account of the Bonds shall be deposited,as collected,to the credit of the Interest
and Sinking Fund. During each year while any of the Bonds or interest thereon are outstanding and
unpaid,the City Council shall compute and ascertain a rate and amount of ad valorem tax which will
be sufficient to raise and produce the money required to pay the interest on the Bonds as such interest
comes due,and to provide and maintain a sinking fund adequate to pay the principal of the Bonds as
such principal matures (but never less than 2% of the original principal amount of the Bonds as a
sinking fund each year); and the tax shall be based on the latest approved tax rolls of the City,with
full allowance being made for tax delinquencies and the cost of tax collection. The rate and amount
of ad valorem tax is hereby levied,and is hereby ordered to be levied,against all taxable property in
the City for each year while any of the Bonds or interest thereon are outstanding and unpaid;and the
tax shall be assessed and collected each such year and deposited to the credit of the Interest and
Sinking Fund. The ad valorem taxes sufficient to provide for the payment of the interest on and
principal of the Bonds,as such interest comes due and such principal matures,are hereby pledged for
such payment,within the limit prescribed by law. Accrued interest on the Bonds shall be deposited
in the Interest and Sinking Fund.
Section 9. DEFEASANCE OF BONDS. (a) Any Bond and the interest thereon shall be
deemed to be paid,retired and no longer outstanding(a"Defeased Bond")within the meaning of this
Ordinance,except to the extent provided in subsections(c)and(e)of this Section,when payment of
*As provided in the Pricing Certificate. To the extent that the Pricing Certificate relating to the Bonds is inconsistent with any provisions in this
Form of Bond or contains information to complete missing information in this Form of Bond,the language in the Pricing Certificate shall be used in
the executed Bonds.
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the principal of such Bond,plus interest thereon to the due date or dates(whether such due date or
dates be by reason of maturity, upon redemption, or otherwise) either(i) shall have been made or
caused to be made in accordance with the terms thereof(including the giving of any required notice
of redemption or the establishment of irrevocable provisions for the giving of such notice) or(ii)
shall have been provided for on or before such due date by irrevocably depositing with or making
available to the Paying Agent/Registrar or an eligible trust company or commercial bank for such
payment (1) lawful money of the United States of America sufficient to make such payment, (2)
Defeasance Securities, certified by an independent public accounting firm of national reputation to
mature as to principal and interest in such amounts and at such times as will ensure the availability,
without reinvestment, of sufficient money to provide for such payment and when proper
arrangements have been made by the City with the Paying Agent/Registrar or an eligible trust
company or commercial bank for the payment of its services until all Defeased Bonds shall have
become due and payable or (3) any combination of(1) and (2). At such time as a Bond shall be
deemed to be a Defeased Bond hereunder, as aforesaid, such Bond and the interest thereon shall no
longer be secured by,payable from,or entitled to the benefits of,the ad valorem taxes herein levied
as provided in this Ordinance, and such principal and interest shall be payable solely from such
money or Defeasance Securities.
(b) The deposit under clause(ii)of subsection(a)shall be deemed a payment of a Bond
as aforesaid when proper notice of redemption of such Bond shall have been given or upon the
establishment of irrevocable provisions for the giving of such notice, in accordance with this
Ordinance. Any money so deposited with the Paying Agent/Registrar or an eligible trust company or
commercial bank as provided in this Section may at the discretion of the City Council also be
invested in Defeasance Securities,maturing in the amounts and at the times as hereinbefore set forth,
and all income from all Defeasance Securities in possession of the Paying Agent/Registrar or an
eligible trust company or commercial bank pursuant to this Section which is not required for the
payment of such Bond and premium, if any, and interest thereon with respect to which such money
has been so deposited, shall be remitted to the City Council.
(c) Notwithstanding any provision of any other Section of this Ordinance which may be
contrary to the provisions of this Section, all money or Defeasance Securities set aside and held in
trust pursuant to the provisions of this Section for the payment of principal of the Bond and
premium, if any, and interest thereon, shall be applied to and used solely for the payment of the
particular Bond and premium, if any, and interest thereon, with respect to which such money or
Defeasance Securities have been so set aside in trust. Until all Defeased Bonds shall have become
due and payable,the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for
such Defeased Bonds the same as if they had not been defeased, and the City shall make proper
arrangements to provide and pay for such services as required by this Ordinance.
(d) Notwithstanding anything elsewhere in this Ordinance, if money or Defeasance
Securities have been deposited or set aside with the Paying Agent/Registrar or an eligible trust
company or commercial bank pursuant to this Section for the payment of the Bond and such Bond
shall not have in fact been actually paid in full,no amendment of the provisions of this Section shall
be made without the consent of the registered owner of each Bond affected thereby.
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(e) Notwithstanding the provisions of subsection (a) immediately above, to the extent
that, upon the defeasance of any Defeased Bond to be paid at its maturity,the City retains the right
under Texas law to later call that Defeased Bond for redemption in accordance with the provisions of
this Ordinance, the City may call such Defeased Bond for redemption upon complying with the
provisions of Texas law and upon the satisfaction of the provisions of subsection(a) immediately
above with respect to such Defeased Bond as though it was being defeased at the time of the exercise
of the option to redeem the Defeased Bond and the effect of the redemption is taken into account in
determining the sufficiency of the provisions made for the payment of the Defeased Bond.
Section 10. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED
BONDS. (a) Replacement Bonds. In the event any outstanding Bond is damaged,mutilated, lost,
stolen,or destroyed,the Paying Agent/Registrar shall cause to be printed,executed,and delivered,a
new Bond of the same principal amount,maturity,and interest rate,as the damaged,mutilated,lost,
stolen, or destroyed Bond, in replacement for such Bond in the manner hereinafter provided.
(b) Application for Replacement Bonds. Application for replacement of damaged,
mutilated, lost, stolen, or destroyed Bonds shall be made by the Registered Owner thereof to the
Paying Agent/Registrar. In every case of loss,theft,or destruction of a Bond,the Registered Owner
applying for a replacement bond shall furnish to the City and to the Paying Agent/Registrar such
security or indemnity as may be required by them to save each of them harmless from any loss or
damage with respect thereto. Also, in every case of loss, theft, or destruction of a Bond, the
Registered Owner shall furnish to the City and to the Paying Agent/Registrar evidence to their
satisfaction of the loss, theft, or destruction of such Bond, as the case may be In every case of
damage or mutilation of a Bond,the Registered Owner shall surrender to the Paying Agent/Registrar
for cancellation the Bond so damaged or mutilated.
(c) No Default Occurred. Notwithstanding the foregoing provisions of this Section,in
the event any such Bond shall have matured,and no default has occurred which is then continuing in
the payment of the principal of,redemption premium, if any,or interest on the Bond, the City may
authorize the payment of the same (without surrender thereof except in the case of a damaged or
mutilated Bond)instead of issuing a replacement Bond,provided security or indemnity is furnished
as above provided in this Section.
(d) Charge for Issuing Replacement Bonds. Prior to the issuance of any replacement
Bond, the Paying Agent/Registrar shall charge the Registered Owner of such Bond with all legal,
printing,and other expenses in connection therewith. Every replacement Bond issued pursuant to the
provisions of this Section by virtue of the fact that any Bond is lost, stolen, or destroyed shall
constitute a contractual obligation of the City whether or not the lost,stolen,or destroyed Bond shall
be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this
Ordinance equally and proportionately with any and all other Bonds duly issued under this
Ordinance.
(e) Authority for Issuing Replacement Bonds. In accordance with Subchapter D of Texas
Government Code, Chapter 1201, this Section of this Ordinance shall constitute authority for the
issuance of any such replacement Bond without necessity of further action by the governing body of
HUNTSVILLE\GOR13\2012 Ordnance 20
vommi
the City or any other body or person, and the duty of the replacement of such Bonds is hereby
authorized and imposed upon the Paying Agent/Registrar, and the Paying Agent/Registrar shall
authenticate and deliver such Bonds in the form and manner and with the effect, as provided in
Section 6(a) of this Ordinance for Bonds issued in conversion and exchange for other Bonds.
Section 11. CUSTODY, APPROVAL, AND REGISTRATION OF BOND; BOND
COUNSEL'S OPINION. The Mayor of the City and the City Manager are hereby authorized to
have control of the initial Bonds issued and delivered hereunder and all necessary records and
proceedings pertaining to the Bond pending its delivery and their investigation, examination, and
approval by the Attorney General of the State of Texas, and their registration by the Comptroller of
Public Accounts of the State of Texas. Upon registration of the Bond the Comptroller of Public
Accounts (or a deputy designated in writing to act for the Comptroller) shall manually sign the
Comptroller's Registration Certificate attached to such Bond,and the seal of the Comptroller shall be
impressed, or placed in facsimile, on such Certificate. The approving legal opinion of the City's
Bond Counsel may,at the option of the City,be printed on the Bond issued and delivered under this
Ordinance,but it shall have no legal effect, and shall be solely for the convenience and information
of the Registered Owner of the Bonds.
Section 12. COVENANTS REGARDING TAX EXEMPTION OF INTEREST ON
THE BOND. (a) Covenants. The City covenants to take any action necessary to assure,or refrain
from any action which would adversely affect,the treatment of the Bonds as an obligation described
in section 103 of the Internal Revenue Code of 1986,as amended(the"Code"),the interest on which
is not includable in the "gross income" of the holder for purposes of federal income taxation. In
furtherance thereof, the City covenants as follows: ,
(1) to take any action to assure that no more than 10 percent of the proceeds of the
Bonds or the Refunded Obligations or the projects financed or refinanced therewith (lessF'
amounts deposited to a reserve fund, if any) are used for any "private business use," as
defined in section 141(b)(6) of the Code or, if more than 10 percent of the proceeds of the
Bonds or the Refunded Obligations or the projects financed or refinanced therewith are so ,
used, such amounts, whether or not received by the City, with respect to such private
business use, do not, under the terms of this Ordinance or any underlying arrangement,
directly or indirectly, secure or provide for the payment of more than 10 percent of the debt `.
service on the Bonds, in contravention of section 141(b)(2) of the Code;
(2) to take any action to assure that in the event that the "private business use"
described in subsection (1) hereof exceeds 5 percent of the proceeds of the Bonds or the
Refunded Obligations or the projects financed or refinanced therewith (less amounts
deposited into a reserve fund, if any) then the amount in excess of 5 percent is used for a
"private business use" which is "related" and not"disproportionate," within the meaning of
section 141(b)(3) of the Code, to the governmental use;
(3) to take any action to assure that no amount which is greater than the lesser of
$5,000,000,or 5 percent of the proceeds of the Bonds(less amounts deposited into a reserve
FIUNTSVILLE\GORB\2012:Ordinance 21
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fund,if any)is directly or indirectly used to finance loans to persons,other than state or local
governmental units, in contravention of section 141(c) of the Code;
(4) to refrain from taking any action which would otherwise result in the Bonds
being treated as a"private activity bonds"within the meaning of section 141(b)of the Code;
(5) to refrain from taking any action that would result in the Bonds being
"federally guaranteed" within the meaning of section 149(b) of the Code;
(6) to refrain from using any portion of the proceeds of the Bonds, directly or
indirectly, to acquire or to replace funds which were used, directly or indirectly, to acquire
investment property (as defined in section 148(b)(2) of the Code) which produces a
materially higher yield over the term of the Bonds,other than investment property acquired
with --
(A) proceeds of the Bonds invested for a reasonable temporary period of 3
years or less or,in the case of a current refunding bonds, for a period of 90 days and
in the case of an advance refunding bonds, for a period of 30 days,
(B) amounts invested in a bona fide debt service fund,within the meaning
of section 1.148-1(b) of the Treasury Regulations, and
(C) amounts deposited in any reasonably required reserve or replacement
fund to the extent such amounts do not exceed 10 percent of the proceeds of the
Bonds;
(7) to otherwise restrict the use of the proceeds of the Bonds or amounts treated
as proceeds of the Bonds, as may be necessary, so that the Bonds does not otherwise 3
contravene the requirements of section 148 of the Code (relating to arbitrage) and, to the
extent applicable, section 149(d) of the Code(relating to advance refundings); and
(8) to pay to the United States of America at least once during each five-year
period(beginning on the date of delivery of the Bonds)an amount that is at least equal to 90
percent of the "Excess Earnings," within the meaning of section 148(f) of the Code and to
pay to the United States of America,not later than 60 days after the Bonds has been paid in
full, 100 percent of the amount then required to be paid as a result of Excess Earnings under
section 148(f) of the Code.
(b) Rebate Fund. In order to facilitate compliance with the above covenant(8),a"Rebate
Fund"is hereby established by the City for the sole benefit of the United States of America,and such
fund shall not be subject to the claim of any other person, including without limitation the
bondholders. The Rebate Fund is established for the additional purpose of compliance with section
148 of the Code.
HUNTSVILLE GOM2012 Ordinance 22
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(c) Proceeds. The City understands that the term "proceeds" includes "disposition
proceeds" as defined in the Treasury Regulations and, in the case of refunding bonds, transferred
proceeds (if any) and proceeds of the Refunded Obligations not expended prior to the date of
issuance of the Bonds. It is the understanding of the City that the covenants contained herein are
intended to assure compliance with the Code and any regulations or rulings promulgated by the U.S.
Department of the Treasury pursuant thereto. In the event that regulations or rulings are hereafter
promulgated which modify or expand provisions of the Code, as applicable to the Bonds, the City
will not be required to comply with any covenant contained herein to the extent that such failure to
comply, in the opinion of nationally recognized bond counsel, will not adversely affect the
exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In
the event that regulations or rulings are hereafter promulgated which impose additional requirements
which are applicable to the Bonds,the City agrees to comply with the additional requirements to the
extent necessary, in the opinion of nationally recognized bond counsel, to preserve the exemption
from federal income taxation of interest on the Bonds under section 103 of the Code. In furtherance
of such intention, the City hereby authorizes and directs the City Manager or the Mayor to execute
any documents, certificates or reports required by the Code and to make such elections,on behalf of
the City,which may be permitted by the Code as are consistent with the purpose for the issuance of
the Bonds.
(d) Disposition of Project. The City covenants that the property constituting the projects
financed or refinanced with the proceeds of the Bonds will not be sold or otherwise disposed in a
transaction resulting in the receipt by the City of cash or other compensation,unless the City obtains
an opinion of nationally-recognized bond counsel that such sale or other disposition will not
adversely affect the tax-exempt status of the Bonds. For purposes of the foregoing,the portion of the
property comprising personal property and disposed in the ordinary course shall not be treated as a
transaction resulting in the receipt of cash or other compensation. For purposes hereof,the City shall
not be obligated to comply with this covenant if it obtains an opinion that such failure to comply will
not adversely affect the excludability for federal income tax purposes from gross income of the
interest.
(e) Designation as Qualified Tax-Exempt Obligation. The City hereby designates the
Bonds as a "qualified tax-exempt obligation" as defined in section 265(b)(3) of the Code. In
furtherance of such designation,the City represents, covenants and warrants the following: (a)that
during the calendar year in which the Bonds are issued,the City(including any subordinate entities)
has not designated nor will designate bonds, which when aggregated with the Bonds,will result in
more than $10,000,000 of "qualified tax-exempt obligations" being issued; (b) that the City
reasonably anticipates that the amount of tax-exempt obligations issued,during the calendar year in
which the Bonds are issued, by the City(or any subordinate entities) will not exceed$10,000,000;
and, (c) that the City will take such action or refrain from such action as necessary, and as more
particularly set forth in this Section,in order that the Bonds will not be considered a"private activity
bond" within the meaning of section 141 of the Code.
Section 13. APPROVAL OF OFFERING DOCUMENTS, PAYING
AGENT/REGISTRAR AGREEMENT AND ESCROW AGREEMENT.The Pricing Officer is
hereby authorized to approve the Preliminary Official Statement,the Official Statement relating to
tiUNTSVII LE\GORB\2012 Ordinance 23
the Bonds and any addenda,supplement or amendment thereto and to deem such documents final in
accordance with Rule 1 5c2-12. The City further approves the distribution of such Official Statement
in the reoffering of the Bonds by the Purchaser in final form,with such changes therein or additions
thereto as the Pricing Officer executing the same may deem advisable, such determination to be
conclusively evidenced by his execution thereof.
The Paying Agent/Registrar Agreement by and between the City and the Paying
Agent/Registrar ("Paying Agent Agreement") in substantially the form and substance previously
approved by the City in previous transactions. The Pricing Officer is hereby authorized and directed
to complete, amend, modify and execute the Paying Agent Agreement as necessary.
The discharge and defeasance of Refunded Obligations shall be effectuated pursuant to the
terms and provisions of an Escrow Agreement,in the form and containing the terms and provisions
as shall be approved by a Pricing Officer, including any insertions, additions, deletions, and
modifications as may be necessary (a) to carry out the program designed for the City by the
Purchasers, (b)to maximize the City's present value savings and/or to minimize the City's costs of
refunding, (c) to comply with all applicable laws and regulations relating to the refunding of the
Refunded Obligations and(d)to carry out the other intents and purposes of this Ordinance;and,the
Pricing Officer is hereby authorized to execute and deliver such Escrow Agreement,on behalf of the
City, in multiple counterparts.
To maximize the City's present value savings and to minimize the City's costs of refunding,
the City hereby authorizes and directs that certain of the Refunded Obligations shall be called for
redemption prior to maturity in the amounts, at the dates and at the redemption prices set forth in
each Pricing Certificate, and the Pricing Officer is hereby authorized and directed to take all
necessary and appropriate action to give or cause to be given a notice of redemption to the holders or
paying agent/registrars,as appropriate,of such Refunded Obligations,in the manner required by the
documents authorizing the issuance of such Refunded Obligations.
The Pricing Officer and the Escrow Agent are each hereby authorized (a) to subscribe for,
agree to purchase, and purchase Defeasance Securities that are permitted investments for a
defeasance escrow established to defease Refunded Obligations, and to execute any and all
subscriptions, purchase agreements, commitments, letters of authorization and other documents
necessary to effectuate the foregoing, and any actions heretofore taken for such purpose are hereby
ratified and approved, and(b)to authorize such contributions to the escrow fund as are provided in
the Escrow Agreement.
Section 14. CONTROL AND DELIVERY OF BONDS
(a) The Pricing Officer is hereby authorized to have control of the Initial Bond and all
necessary records and proceedings pertaining thereto pending investigation, examination and
approval of the Attorney General of the State of Texas, registration by the Comptroller of Public
Accounts of the State of Texas,and registration with,and initial exchange or transfer by,the Paying
Agent/Registrar.
HUNTSVILLE\GORB\2012 Ordinance 24
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(b) After registration by the Comptroller of Public Accounts of the State of Texas,
delivery of the Bonds shall be made to the Purchasers under and subject to the general supervision
and direction of the Mayor of the City, against receipt by the City of all amounts due to the City
under the terms of sale.
Section 15. APPROVAL OF OFFICIAL STATEMENT. The Pricing Officer is hereby
authorized to approve the Preliminary Official Statement and the Official Statement relating to the
Bonds and any addenda, supplement or amendment thereto, and to deem such documents final in
accordance with Rule 15c2-12. The City further approves the distribution of such Official Statement
in the reoffering of the Bonds by the underwriter in final form, with such changes therein or
additions thereto as the Pricing Officer executing the same may deem advisable,such determination
to be conclusively evidenced by his execution thereof.
Section 16. INSURANCE PROVISIONS. In connection with the sale of the Bonds,the
City may obtain municipal bond insurance policies from one or more recognized municipal bond
insurance organizations(the "Bond Insurer"or"Bond Insurers")to guarantee the full and complete
payment required to be made by or on behalf of the City on the Bonds. The Pricing Officer is hereby
authorized to sign a commitment letter or agreement with the Bond Insurer or Bond Insurers and to
pay the premium for the bond insurance policies at the time of the delivery of the Bonds to the
underwriter out of the proceeds of sale of the Bonds or from other available funds and to execute
such other documents and certificates as necessary in connection with the bond insurance policies as
the Pricing Officer may deem appropriate. Printing on the Bonds covered by the bond insurance
policies a statement describing such insurance,in form and substance satisfactory to the Bond Insurer
and the Pricing Officer, is hereby approved and authorized. The Pricing Certificate may contain
provisions related to the bond insurance policies,including payment provisions thereunder,and the
rights of the Bond Insurer or Insurers, and any such provisions shall be read and interpreted as an
integral part of this Ordinance.
Section 17. CONTINUING DISCLOSURE.(a) Annual Reports. The City shall provide
annually to the MSRB, in an electronic format as prescribed by the MSRB,within six months after
the end of any fiscal year, financial information and operating data with respect to the City as
determined by the Pricing Officer at the time the Bonds are sold. The Pricing Certificate shall
specify such financial information and operating data of the general type included in the final
Official Statement authorized by Section 16 of this Ordinance. Any financial statements to be so
provided shall be(1)prepared in accordance with the accounting principles described in Exhibit"B"
hereto,or such other accounting principles as the City may be required to employ from time to time
pursuant to state law or regulation, and (2) audited, if the City commissions an audit of such
statements and the audit is completed within the period during which they must be provided. If the
audit of such financial statements is not complete within such period, then the City shall provide
unaudited financial statements within such period,and audited financial statements for the applicable
fiscal year to the MSRB, when and if the audit report on such statements become available.
If the City changes the fiscal year, the City will notify the MSRB of the change(and of the
date of the new fiscal year end)prior to the next date by which the City otherwise would be required
to provide financial information and operating data pursuant to this Section.
HUNTSVILLE\GORRi2O12 Ordinance 25
The financial information and operating data to be provided pursuant to this subsection may
be set forth in full in one or more documents or may be included by specific reference to any
document that is available to the public on the MSRB's internet web site or filed with the SEC. All
documents provided to the MSRB pursuant to this subsection shall be accompanied by identifying
information as prescribed by the MSRB.
(b) Event Notices. The City shall notify the MSRB,in an electronic format as prescribed
by the MSRB,in a timely manner not in excess of ten business days after the occurrence of the event,
of any of the following events with respect to the Bonds:
A. Principal and interest payment delinquencies;
B. Non-payment related defaults,if material within the meaning of the federal securities
laws;
C. Unscheduled draws on debt service reserves reflecting financial difficulties;
D. Unscheduled draws on credit enhancements reflecting financial difficulties;
E. Substitution of credit or liquidity providers, or their failure to perform;
F. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or
final determinations of taxability,Notices of Proposed Issue(IRS Form 5701BTEB)or other material
notices or determinations with respect to the tax-exempt status of the Bonds, or other events
affecting the tax-exempt status of the Bonds;
G. Modifications to rights of holders of the Bonds,if material within the meaning of the
federal securities laws;
H. Bond calls, if material within the meaning of the federal securities laws and tender
offers;
I. Defeasances;
J. Release,substitution,or sale of property securing repayment of the Bonds,if material
within the meaning of the federal securities laws;
K. Rating changes;
L. Bankruptcy, insolvency, receivership or similar event of the City;
M. The consummation of a merger,consolidation,or acquisition involving the City or the
sale of all or substantially all of the assets of the City, other than in the ordinary course of business,
the entry into a definitive agreement to undertake such an action or the termination of a definitive
HUNTSVII CE GORI3\2012 Ordinance 26
agreement relating to any such actions, other than pursuant to its terms, if material within the
meaning of the federal securities laws; and
N. Appointment of a successor or additional trustee or the change of name of a trustee,if
material within the meaning of the federal securities laws.
The City shall notify the MSRB, in an electronic format as prescribed by the MSRB, in a
timely manner, of any failure by the City to provide financial information or operating data in
accordance with this subsection by the time required.All documents provided to the MSRB pursuant
to this subsection shall be accompanied by identifying information as prescribed by the MSRB.
(c) Limitations, Disclaimers, and Amendments. The City shall be obligated to observe
and perform the covenants specified in this Section for so long as,but only for so long as, the City
remains an"obligated person"with respect to the Bonds within the meaning of the Rule,except that
the City in any event will give the notice required by this Ordinance of any Bond calls and
defeasance that cause the Bonds to be no longer outstanding.
The provisions of this Section are for the sole benefit of the holders and beneficial owners of
the Bonds, and nothing in this Section, express or implied, shall give any benefit or any legal or
equitable right,remedy,or claim hereunder to any other person. The City undertakes to provide only
the financial information, operating data, financial statements, and notices that it has expressly
agreed to provide pursuant to this Section and does not hereby undertake to provide any other
information that may be relevant or material to a complete presentation of the City's financial results,
condition, or prospects relating to the Financing System or hereby undertake to update any
information provided in accordance with this Section or otherwise, except as expressly provided
herein. The City does not make any representation or warranty concerning such information or its
usefulness to a decision to invest in or sell Bonds at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR
BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON,IN CONTRACT OR TORT,
FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE CITY,
WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT
SPECIFIED IN THIS SECTION,BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON,
IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE
LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE. `'
No default by the City in observing or performing its obligations under this Section shall
constitute a breach of or default under this Ordinance for purposes of any other provision of this
Ordinance.
Should the Rule be amended to obligate the City to make filings with or provide notices to
entities other than the MSRB,the City hereby agrees to undertake such obligation with respect to the
Bonds in accordance with the Rule as amended.
HUNTSVILLE\GORB\2012: Ordinance 27 s`
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the
duties of the City under federal and state securities laws.
The provisions of this Section may be amended by the City from time to time to adapt to
changed circumstances that arise from a change in legal requirements,a change in law,or a change
in the identity, nature, status, or type of operations of the City,but only if(1)the provisions of this
Section, as so amended, would have permitted an underwriter to purchase or sell Bonds in the
primary offering of the Bonds in compliance with the Rule,taking into account any amendments or
interpretations of the Rule to the date of such amendment, as well as such changed circumstances,
and (2) either (A) the holders of a majority in aggregate principal amount (or any greater amount
required by any other provision of this Ordinance that authorizes such an amendment) of the
outstanding Bonds consent to such amendment or(B)a person that is unaffiliated with the City(such
as nationally recognized bond counsel)determines that such amendment will not materially impair
the interests of the holders and beneficial owners of the Bonds. If the City so amends the provisions
of this Section, it shall include with any amended financial information or operating data next
provided in accordance with this Section an explanation, in narrative form, of the reasons for the
amendment and of the impact of any change in the type of financial information or operating data so
provided. The City may also amend or repeal the provisions of this continuing disclosure
requirement if the SEC amends or repeals the applicable provisions of the Rule or a court of final
jurisdiction enters judgment that such provisions of the Rule are invalid,but only if and to the extent
that the provisions of this sentence would not prevent an underwriter from lawfully purchasing or
selling the Bonds in the primary offering of the Bonds.
Section 18. AMENDMENT OF ORDINANCE. The City hereby reserves the right to
amend this Ordinance subject to the following terms and conditions, to-wit:
(a) The City may from time to time,without the consent of the Registered Owner,except
as otherwise required by paragraph (b)below, amend or supplement this Ordinance in order to (i)
cure any ambiguity,defect or omission in this Ordinance that does not materially adversely affect the
interests of the holders, (ii)grant additional rights or security for the benefit of the holders,(iii)add
events of default as shall not be inconsistent with the provisions of this Ordinance and that shall not
materially adversely affect the interests of the holders, (v) qualify this Ordinance under the Trust
Indenture Act of 1939,as amended,or corresponding provisions of federal laws from time to time in
effect, or (iv) make such other provisions in regard to matters or questions arising under this
Ordinance as shall not be inconsistent with the provisions of this Ordinance and that shall not in the
opinion of the City's Bond Counsel materially adversely affect the interests of the holders.
(b) Except as provided in paragraph(a)above,the Registered Owner shall have the right
from time to time to approve any amendment hereto that may be deemed necessary or desirable by
the City; provided, however, that without the consent of the Registered Owner, nothing herein
contained shall permit or be construed to permit amendment of the terms and conditions of this
Ordinance or in the Bond so as to
(1) Make any change in the maturity of the Bond;
HUNTSVILLE\GORB 4'012 ordinance 28
(2) Reduce the rate of interest borne by the Bond;
(3) Reduce the amount of the principal of, or redemption premium, if any,
payable on the Bond;
(4) Modify the terms of payment of principal or of interest or redemption
premium on the Bond or impose any condition with respect to such payment;
or
(5) Change the requirement with respect to Registered Owner consent to such
amendment.
(c) If at any time the City shall desire to amend this Ordinance under this Section, the
City shall send by U.S. mail to the Registered Owner a copy of the proposed amendment.
(d) Whenever at any time within one year from the date of publication of such notice the
City shall receive an instrument or instruments executed by the Registered Owner,which instrument
or instruments shall refer to the proposed amendment and that shall specifically consent to and
approve such amendment, the City may adopt the amendment in substantially the same form.
(e) Upon the adoption of any amendatory ordinance pursuant to the provisions of this
Section, this Ordinance shall be deemed to be modified and amended in accordance with such
amendatory Ordinance, and the respective rights, duties, and obligations of the City and the
Registered Owner shall thereafter be determined, exercised, and enforced, subject in all respects to
such amendment.
(f) Any consent given by the Registered Owner of a Bond pursuant to the provisions of
this Section shall be irrevocable for a period of six months from the date of such consent, and shall
be conclusive and binding upon all future holders of the same Bond during such period. Such
consent may be revoked at any time after six months from the date of consent by the Registered
Owner who gave such consent, or by a successor in title, by filing notice with the City.
For the purposes of establishing ownership of the Bonds, the City shall rely solely upon the
registration of the ownership of such Bonds on the Register kept by the Paying Agent/Registrar.
Section 19. REMEDIES IN EVENT OF DEFAULT. In addition to all the rights and
remedies provided by the laws of the State of Texas, it is specifically covenanted and agreed
particularly that in the event the City(i)defaults in the payment of the principal,premium,if any,or
interest on the Bonds, (ii)declares bankruptcy,or(iii)defaults in the observance or performance of
any other of the covenant, agreement or obligation of the City, the failure to perform which
materially adversely affects the rights of the owner, including but no limited to, their prospect or
ability to be repaid in accordance with this Section and the continuation thereof for a period of 60
days after notice of such default is given by any owner to the City, the following remedies shall be
available:
HUNTSVILLE\GORB\2012: Ordinance 29
(a) Any owner or an authorized representative thereof, including but not limited to, a
trustee or trustees therefore,may proceed against the City for the purpose of protecting and enforcing
the rights to the owner under this Ordinance,by mandamus or other suit,action or special proceeding
in equity or at law,in any court of competent jurisdiction,for any relief permitted by law,including
the specific performance of any covenant or agreement contained herein,or thereby to enjoin any act
or thing that may be unlawful or in violation of any right of the owner hereunder or any combination
of such remedies.
(b) No remedy herein conferred or reserved is intended to be exclusive of any other
available remedy or remedies, but each and every such remedy shall be cumulative and shall be in
addition to every other remedy given hereunder or under the Bonds or now or hereafter existing at
law or in equity;provided,however,that notwithstanding any other provision of this Ordinance,the
right to accelerate the debt evidenced by the Bonds shall not be available as a remedy under this
Ordinance. The exercise of any remedy herein conferred or reserved shall not be deemed a waiver of
any other available remedy.
Section 20. NO RECOURSE AGAINST CITY OFFICIALS. No recourse shall be had
for the payment of principal of or interest on the Bonds or for any claim based thereon or on this
Ordinance against any official of the City or any person executing any Bond.
Section 21. FURTHER ACTIONS. The Mayor,the City Manager and all other officers
and employees of the City are hereby authorized,empowered and directed from time to time and at
any time to do and perform all such acts and things and to execute, acknowledge and deliver in the
name and under the corporate seal and on behalf of the City all such instruments, whether or not
herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of
this Ordinance and the Bonds. In addition,prior to the initial delivery of the Bonds,the Mayor,the
City Manager, the Director of Finance and Bond Counsel are hereby authorized and directed to
approve any changes or corrections to this Ordinance or to any of the instruments authorized and
approved by this Ordinance necessary in order to(i)correct any ambiguity or mistake or properly or
more completely document the transactions contemplated and approved by this Ordinance,(ii)obtain
a rating from any of the national bond rating agencies or satisfy requirements of any bond insurer,or
(iii) obtain the approval of the Bond by the Texas Attorney General's office.
In case any officer of the City whose signature shall appear on any Bonds shall cease to be
such officer before the delivery of such Bonds, such signature shall nevertheless be valid and
sufficient for all purposes the same as if such officer had remained in office until such delivery.
Section 22. PERFECTION. Chapter 1208,Government Code,applies to the issuance of
the Bond and the pledge of ad valorem taxes granted by the City under Section 8 of this Ordinance,
and such pledge is therefore valid, effective and perfected. If Texas law is amended at any time
while the Bond is outstanding and unpaid such that the pledge of ad valorem taxes granted by the
City under Section 8 of this Ordinance is to be subject to the filing requirements of Chapter 9,
Business & Commerce Code, then in order to preserve to the Registered Owner of the Bonds the
perfection of the security interest in said pledge, the City agrees to take such measures as it
determines are reasonable and necessary under Texas law to comply with the applicable provisions
HUNTSVILLE\G01213\2012 Ordinance 30
of Chapter 9,Business&Commerce Code and enable a filing to perfect the security interest in said
pledge to occur.
Section 23. INTERPRETATIONS. All tei ins defined herein and all pronouns used in
this Ordinance shall be deemed to apply equally to singular and plural and to all genders. The titles
and headings of the articles and sections of this Ordinance have been inserted for convenience of
reference only and are not to be considered a part hereof and shall not in any way modify or restrict
any of the terms or provisions hereof. This Ordinance and all the terms and provisions hereof shall
be liberally construed to effectuate the purposes set forth herein and to sustain the validity of the
Bonds and the validity of the lien on and pledge to secure the payment of the Bonds.
Section 24. INCONSISTENT PROVISIONS. All ordinances,orders or resolutions,or
parts thereof,which are in conflict or inconsistent with any provisions 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 25. INTERESTED PARTIES. Nothing in this Ordinance expressed or implied
is intended or shall be construed to confer upon, or to give to, any person or entity, other than the
City and the Registered Owner of the Bonds, any right,remedy or claim under or by reason of this
Ordinance or any covenant,condition or stipulation hereof,and all covenants,stipulations,promises
and agreements in this Ordinance contained by and on behalf of the City shall be for the sole and
exclusive benefit of the City and the Registered Owner of the Bonds.
Section 26. SEVERABILITY. The provisions of this Ordinance are severable; and in
case any one or more of the provisions of this Ordinance or the application thereof to any person or
circumstance should be held to be invalid, unconstitutional, or ineffective as to any person or
circumstance,the remainder of this Ordinance nevertheless shall be valid,and the application of any
such invalid provision to persons or circumstances other than those as to which it is held invalid shall
not be affected thereby.
Section 27. FUNDS AND ACCOUNTS. Notwithstanding anything in this Ordinance to
the contrary any funds or accounts created by this Ordinance, other than the Escrow Fund,may be
subaccounts of the City's Funds held by the City's depository,and,as such,not held in separate bank
accounts, such treatment shall not constitute commingling of the monies in such funds or of funds
and the City shall keep full and complete records indicating the monies and investment credited to
each such fund.
Section 28. REPEALER. All orders, resolutions and ordinances, or parts thereof,
inconsistent herewith are hereby repealed to the extent of such inconsistency.
Section 29. EFFECTIVE DATE. This Ordinance shall become effective immediately
upon its adoption in accordance with Section 1201.028, Texas Government Code, as amended.
HUNTSVILLE GORE4120 1 2 Ordinance 31
Section 30. PAYMENT OF ATTORNEY GENERAL FEE. The City hereby authorizes
the disbursement of a fee equal or lesser of(i)one-tenth of one percent of the principal amount of the
Bonds or(ii) $9,500, provided that such fee shall not be less than$750, to the Attorney General of
Texas Public Finance Division for payment of the examination fee charged by the State of Texas for
the Attorney General=s review and approval of public securities and credit agreements,as required
by Section 1202.004 of the Texas Government Code. The appropriate member of the City's staff is
hereby instructed to take the necessary measures to make this payment. The City is also authorized
to reimburse the appropriate City funds for such payment from proceeds of the Bonds.
HUNTSVILLE\GORI3\20 I 2 Ordinance 32
IN ACCORDANCE WITH SECTION 1201.028, TEXAS GOVERNMENT CODE
passed and approved on First and Final Reading on the 19th day of June 2012.
Mac Woodward, ayor"
City of Huntsville, Texas
ATTEST:
1
11
his i IM ralms..--
oo7Ward, City Secretary
ty of Huntsville, Texas
APPR•VE N AS TO FORM:
f ty- .
(
i
r d Schneider, City Attorney
I of Huntsville, Texas
,
i
4
4
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HUNTSVILLEAGORM2012 Ordinance 33
EXHIBIT "A"
DEFINITIONS
As used in this Ordinance,the following terms and expressions shall have the meanings set
forth below, unless the text hereof specifically indicates otherwise:
"Accountant"means an independent certified public accountant or accountants or a firm of an
independent certified public accountants,in either case,with demonstrated expertise and competence
in public accountancy.
"Accreted Value" means, with respect to a Premium Compound Interest Bond, as of any
particular date of calculation, the original principal amount thereof, plus all interest accrued and
compounded to the particular date of calculation, as determined in accordance with the Pricing
Certificate and the Accretion Table attached as an exhibit to the Pricing Certificate relating to the
respective Bonds that shows the Accreted Value per$5,000 maturity amount on the calculation date
of maturity to its maturity.
"Accretion Table" means the exhibit attached to the Pricing Certificate that sets forth the
rounded original principal amounts at the Issuance Date for the Premium Compound Interest Bonds
and the Accreted Values and maturity amounts thereof as of each Compounding Date until final
maturity.
"Authorized Denominations" means the denomination of$5,000 or any integral multiple
thereof with respect to the Current Interest Bonds and in the denomination of$5,000 in maturity
amount or any integral multiple thereof with respect to the Premium Compound Interest Bonds.
"Bond Insurer"or"Insurer"means the provider of a municipal bond insurance policy for the
Bonds,if any,as determined by the Pricing Officer in the Pricing Certificate or any other entity that
insures or guarantees the payment of principal and interest on any Bonds.
"Bonds"means the"City of Huntsville,Texas General Obligation Refunding Bonds,Series
2012."
"Book-Entry-Only System" means the book-entry system of bond registration provided in
Section 6, or any successor system of book-entry registration.
"Business Day"means any day which is not a Saturday, Sunday or a day on which the Paying
Agent/Registrar is authorized by law or executive order to remain closed.
"Cede & Co." means the designated nominee and its successors and assigns of The
Depository Trust Company, New York.
"City" and "Issuer" mean the City of Huntsville, Texas, and where appropriate, the City 14,
Council.
A-1
HUNTSVILLE\GORB 2012 Ordinance
"City Council" means the governing body of the City.
"Closing Date" means the date of initial delivery of and payment for the Bonds.
"Compounded Amount" means, with respect to a Premium Compound Interest Bond, as of
any particular date of calculation,the original principal amount thereof plus all interest accrued and
compounded to the particular date of calculation.
"Compounding Dates" means the dates on which interest is compounded on the Premium
Compound Interest Bonds as set forth in the Accretion Table attached to the Pricing Certificate.
"Current Interest Bonds"means the Bonds paying current interest and maturing in each of the
years and in the aggregate principal amounts set forth in the Pricing Certificate.
"Defeasance Securities" means (i) Federal Securities, (ii) noncallable obligations of an
agency or instrumentality of the United States of America, including obligations that are
unconditionally guaranteed or insured by the agency or instrumentality and that,on the date the City
Council adopts or approves proceedings authorizing the issuance of refunding bonds or otherwise
provide for the funding of an escrow to effect the defeasance of the Bonds are rated as to investment
quality by a nationally recognized investment rating firm not less than"AAA"or its equivalent,(iii)
noncallable obligations of a state or an agency or a county, municipality, or other political
subdivision of a state that have been refunded and that, on the date the City Council adopts or
approves proceedings authorizing the issuance of refunding bonds or otherwise provide for the
funding of an escrow to effect the defeasance of the Bonds, are rated as to investment quality by a
nationally recognized investment rating firm no less than"AAA"or its equivalent and(iv)any other
then authorized securities or obligations under applicable State law that may be used to defease
obligations such as the Bonds.
"Depository" means one or more official depository banks of the City.
"DTC"means The Depository Trust Company,New York,New York and its successors and
assigns.
"DTC Participant" means securities brokers and dealers, banks, trust companies, clearing
corporations,and certain other organizations on whose behalf DTC was created to hold securities to
facilitate the clearance and settlement of securities transactions among DTC Participants.
"Escrow Agent"means or any successor escrow agent under the Escrow
Agreement.
"Escrow Agreement" means the agreement by and between the City and the Escrow Agent
relating to the defeasance of the Refunded Obligations.
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HUNTS V ILLE\GORB\2012: Ordinance
"Federal Securities"as used herein means direct,noncallable obligations of the United States
of America, including obligations that are unconditionally guaranteed by the United States of
America(including Interest Strips of the Resolution Funding Corporation).
"Fiscal Year"means the twelve-month accounting period used by the City currently ending
on September 30 of each year,which may be any twelve consecutive month period established by the
City,but in no event may the Fiscal Year be changed more than one time in any three calendar year
period.
"Holder," "Holders," "Owners"or"Registered Owners"means any person or entity in whose
name a Bond is registered in the Security Register, for any Parity Obligation.
"Initial Bond" means the Bond authorized, issued, and initially delivered as provided in
Section 4 of this Ordinance.
"Insurance Policy" means an insurance policy issued by any Insurer guaranteeing the
scheduled principal of and interest on the Bonds when due.
"Interest and Sinking Fund"means the special fund maintained by the provisions of Section 8
of this Ordinance.
"Interest Payment Date" means a date on which interest on the Bonds is due and payable.
"Issuance Date" means the date of delivery of the Bonds.
"MSRB" means the Municipal Securities Rulemaking Board.
"Ordinance" means this ordinance finally adopted by the City Council on June 19, 2012.
"Original Issue Date" means the date designated in each Pricing Certificate.
"Outstanding", when used with respect to Bonds,means,as of the date of determination,all
Bonds theretofore delivered under this Ordinance, except:
(1) Bonds theretofore cancelled and delivered to the City or delivered to the
Paying Agent/Registrar for cancellation;
(2) Bonds deemed paid pursuant to the provisions of Section 9 of this Ordinance;
(3) Bonds upon transfer of or in exchange for and in lieu of which other Bonds
have been authenticated and delivered pursuant to this Ordinance; and
(4) Bonds under which the obligations of the City have been released,discharged
or extinguished in accordance with the terms thereof.
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HUNTSVILLE\GORB\2012 Ordinance
"Paying Agent/Registrar"means Wells Fargo,N.A.,any successor thereto or an entity which
is appointed as and assumes the duties of paying agent/registrar as provided in this Ordinance and
each Pricing Certificate.
"Permitted Investments"means any security or obligation or combination thereof permitted
under the Public Funds Investment Act, Chapter 2256, Texas Government Code, as amended or
other applicable law.
"Premium Compound Interest Bonds"means the Bonds on which no interest is paid prior to
maturity, maturing in various amounts and in the aggregate principal amount as set forth in the
Pricing Certificate.
"Pricing Certificate"means the Pricing Certificate of the City's Pricing Officer to be executed
and delivered pursuant to Section 4 hereof in connection with the issuance of the Bonds.
"Pricing Officer"means the City Manager,acting as the designated pricing officer of the City
to execute the Pricing Certificate. In the absence of the City Manager, the City's Finance Director
may act as the designated pricing officer of the City to execute the Pricing Certificate.
"Rating Agency" means any nationally recognized securities rating agency which has
assigned, at the request of the City, a rating to the Bonds.
"Record Date" means Record Date as defined in Section 7 the Form of Bonds.
"Redemption Date"means a date fixed for redemption of any Bond pursuant to the terms of
this Ordinance.
"Refunded Obligations" means those Refundable Obligations designated by the Pricing
Officer in the Pricing Certificate to be refunded.
"Refundable Obligations" means all or a portion of the City's outstanding ad valorem tax
obligations and waterworks and sewer revenue bonds.
"Register" or "Registration Books" means the registry system maintained on behalf of the
City by the Registrar in which are listed the names and addresses of the Registered Owners and the
principal amount of Bonds registered in the name of each Registered Owner.
"Replacement Bonds"means the Bonds authorized by the City to be issued in substitution for
lost, apparently destroyed, or wrongfully taken Bonds as provided in Section 10 of this Ordinance.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
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HUNTS V I LLE\GORB\2012: Ordinance
EXHIBIT "B"
CONTINUING DISCLOSURE
The following information is referred to in Section 18 of this Ordinance.
Accounting Principles
The accounting and reporting policies of the City relating to the funds and account groups
will conform to generally accepted accounting principles (GAAP) as applied to governmental
entities.
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HUNTS V ILLE\GORB\2012: Ordinance