Ord. 1594 2020-08-24ORDINANCE NO. 1=4
An Ordinance of the City Council of the City of Pearland, Texas, authorizing
the issuance of City of Pearland, Texas, permanent improvement refunding
bonds in one or more series; setting certain parameters for the bonds;
authorizing refunding of certain outstanding obligations; authorizing a
pricing officer to approve the amount, the interest rate, price, and terms
thereof and certain other procedures and provisions relating thereto.
WHEREAS, the City of Pearland, Texas (the "City"), acting through its City Council, is
authorized by Section 3.07 of its Home Rule Charter and the Constitution and laws of the State
of Texas, particularly Chapters 1331 of the Texas Government Code, as amended, to issue
bonds for the purpose of making needed public improvements;
WHEREAS, the City Council of the City has heretofore issued or assumed the
obligations described in Exhibit A attached hereto and as more particularly described in the
Officer's Pricing Certificate (defined herein); and
WHEREAS, the City desires to refund part of said obligations in advance of their
maturities as determined pursuant to the parameters set forth herein (the "Refunded Bonds") for
the purpose of achieving debt service savings; and
WHEREAS, Chapter 1207, Texas Government Code, as amended ("Chapter 1207")
authorizes the City to issue refunding bonds payable from taxes, without an election, for the
purpose of refunding the Refunded Bonds in advance of their maturities, and to accomplish
such refunding by depositing directly with any paying agent for the Refunded Bonds (or other
qualified escrow agent), the proceeds of such refunding bonds, together with other available
funds, in an amount sufficient to provide for the payment or redemption of the Refunded Bonds,
and provides that such deposit shall constitute the making of firm banking and financial
arrangements for the discharge and final payment or redemption of the Refunded Bonds; and
WHEREAS, the City desires to authorize the execution of an escrow agreement, if
necessary, and provide for the deposit of proceeds of the refunding bonds, together with other
lawfully available funds of the City, to pay the Refunded Bonds; and
WHEREAS, upon the issuance of the refunding bonds herein authorized and the deposit
of funds referred to above, the Refunded Bonds shall no longer be regarded as being
outstanding, except for the purpose of being paid pursuant to such deposit, and the pledges,
liens, trusts and all other covenants, provisions, terms and conditions of the ordinances
authorizing the issuance of the Refunded Bonds shall be, with respect to the Refunded Bonds,
discharged, terminated and defeased;
WHEREAS, the City is a home -rule municipality that (i) adopted its charter under
Section 5, Article XI, Texas Constitution; (ii) has a population of 50,000 or more; and (iii) has
outstanding long-term indebtedness that is rated by a nationally recognized rating agency for
municipal securities in one of the four highest rating categories for a long-term obligation and
thus the City qualifies as an "Issuer" under Chapter 1371, Texas Government Code ("Chapter
1371 "); and
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WHEREAS, Chapter 1207 and Chapter 1311 authorize the City to delegate the authority
to effect the sale of the Bonds to a Pricing Officer, as defined herein. Now, therefore
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PEARLAND:
1. Recitals; Consideration. It is hereby found and determined that the matters and
facts set out in the preamble to this Ordinance are true and correct.
It is hereby found and determined that the refunding contemplated in this Ordinance will
benefit the City by providing a present value savings in the debt service payable by the City, that
such benefit is sufficient consideration for the refunding of the Refunded Bonds, and that the
issuance of the refunding bonds is in the best interests of the City.
2. Definitions. Throughout this Ordinance the following terms and expressions as
used herein shall have the meanings set forth below:
"Blanket Issuer Letter of Representations" means the Blanket Issuer Letter of
Representations between the City, the Registrar and DTC.
"Bond Purchase Agreement" means an agreement between the City and the Underwriter
described in Section 23 of this Ordinance.
"Bonds" means the means one or more series of Bonds issued by the City of Pearland,
Texas authorized in this Ordinance, as designated in an Officer's Pricing Certificate.
"Business Day" means any day which is not a Saturday, Sunday, or a day on which the
Registrar is authorized by law or executive order to close, or a legal holiday.
"City" means the City of Pearland, Texas.
"Closing Date" means the date of the initial delivery of and payment any series of Bonds.
"Code" means the Internal Revenue Code of 1986, as amended.
"Comptroller" means the Comptroller of Public Accounts of the State of Texas.
"Debt Service Fund" means the debt service fund for payment of the Bonds established
by the City in Section 20 of this Ordinance.
"DTC" means The Depository Trust Company of New York, New York, or any successor
securities depository.
"DTC Participant" means brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations on whose behalf DTC was created to hold
securities to facilitate the clearance and settlement of securities transactions among DTC
Participants.
"Escrow Agent" means Wells Fargo Bank, N.A.
"Escrow Agreement" means an agreement between the City and the Escrow Agent
relating to the escrow of funds to pay the Refunded Bonds.
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"Initial Bond" means the Initial Bond authorized by Section 6(d).
"Interest Payment Date when used in connection with any Bond, means shall mean the
ate(s) determined by a Pricing Officer and set forth in the Officer's Pricing Certificate.
"MSRB" means the Municipal Secures RUlemaking Board.
"Officer's Pricing Certificate" means a certificate signed by the Pricing Officer pursuant to
Section 5 hereof.
Bonds.
"Ordinance" as used herein and in the Bonds means this ordinance authorizing the
"Owner" means any person who shall be the registered owner of any outstanding Bond.
"Pricing Officer" means the Mayor, City Manager, Deputy City Manager, Director of
Finance or the Interim Director of Finance.
"Record Date" means, with respect to the Bonds, the close of business on the 15th
calendar day of the month preceding such Interest Payment Date.
"Refunded Bonds" means any of the obligations described on Exhibit A attached hereto
and as more specifically described in the Officer's Pricing Certificate.
"Register" means the books of registration kept by the Registrar, in which are maintained
the names and addresses of, and the principal amounts of the Bonds registered to, each
Owner.
"Registrar" means Wells Fargo Bank, N.A., and its successors in that capacity.
"Report" means the report verifying the accuracy of certain mathematical computations
relating to the Bonds and the Refunded Bonds as further described in the Escrow Agreement.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
"Underwriters" means the firms listed in the Officer's Pricing Certificate as the
underwriters or initial purchasers of the Bonds.
3. Authorization, The Bonds shall be issued in fully registered form principal if
certain savings thresholds are achieved, in an amount not to exceed $35,000,000 for the
purpose of refunding the Refunded Bonds, under and in strict conformity with the Constitution
and laws of the State of Texas, particularly Chapters 1207, Texas Government Code and the
costs of issuing the Bonds. The Bonds may be issued in one or more series/installments.
4. Date Denomination Interest Rates and Maturities. The Bonds shall be
designated as City of Pearland, Texas Permanent Improvement' and shall be dated the date
set forth in the Officer's Pricing Certificate, shall mature on March 1 in each of the years and in
the amounts set out in the Officer's Pricing Certificate, shall be subject to prior optional and
� Insert from Pricing Certificate.
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mandatory redemption on the dates, for the redemption prices and in the amounts set out in the
Officer's Pricing Certificate and shall bear interest from their issuance date at the rates set forth
in the Officer's Pricing Certificate payable on each March 1 and September 1 commencing on
the date set forth in the Officer's Pricing Certificate. The Bonds may be transferred and
exchanged as set out in this Ordinance. The Initial Bond shall be numbered I-1 and all other
Bonds shall be numbered in sequence beginning with R-1. Bonds delivered on transfer of or in
exchange for other Bonds shall be numbered in order of their authentication by the Registrar,
shall be in the denomination of $5,000 or integral multiples thereof, and shall mature on the
same date and bear interest on the same rate as the Bond or Bonds in lieu of which they are
delivered.
5. Selling and Delivering the Bonds. As authorized by Sections 1207 and 1371,
Texas Government Code, as amended, the Pricing Officer is hereby authorized to act on behalf
of the City in selling and delivering the Bonds, in one or more series of bonds/installments, as
taxable or tax exempt Bonds, and carrying out the other procedures specified in this Ordinance,
including without limitation determining the price at which the Bonds will be sold, the issuance
date for the Bonds, the form in which the Bonds shall be issued (whether as current interest
bonds or as any combination of current interest bonds and compound interest bonds), the years
in which the Bonds will mature, the principal amount to mature in each of such years, the rate of
interest to be borne by each such maturity, the dates, prices 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 redemption provisions for the Bonds, and all other matters not expressly provided in
this Ordinance, relating to the issuance, sale and delivery of the Bonds, and the refunding of the
Refunded Bonds, all of which shall be specified in the Officer's Pricing Certificate; provided that:
(i) none of the Bonds shall bear interest at a rate in excess of the maximum rate
allowed by Chapter 1204, Texas Government Code, as amended;
(ii) the aggregate principal amounts of the Bonds may not exceed the maximum
principal amounts authorized in Section 3 He, and the proceeds from the sale
of the Bonds, along with any available funds of the City to be used in the
refunding, must be sufficient to provide, after all original issue discount and
underwriter's discount, amounts necessary to fund the costs and expenses of
refunding the Refunded Bonds and the estimated costs of issuance of the Bonds;
(iii) the net present value savings in debt service resulting from the refunding of the
Refunded Bonds shall be at least 3% of the principal amount of the Refunded
Bonds, as shown by a table of calculations prepared by the City's financial
advisor and attached to the Officer's Pricing Certificate; and
(iv) the refunding of the Refunded Bonds shall be undertaken to achieve debt service
savings and not for the purpose of restructuring or shortening the amortization of
debt evidenced by the Refunded Bonds.
6. Execution of Bonds; Seal. (a) The Bonds shall be signed on behalf of the City by
the Mayor and countersigned by the City Secretary, by their manual, lithographed, or facsimile
signatures, and the official seal of the City shall be impressed or placed in facsimile thereon.
Such facsimile signatures on the Bonds shall have the same effect as if each of the Bonds had
been signed manually and in person by each of said Officer's, and such facsimile seal on the
Bonds shall have the same effect as if the official seal of the City had been manually impressed
upon each of the Bonds.
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(b) If any officer of the City whose manual or facsimile signature shall appear on the
Bonds shall cease to be such officer before the authentication of such Bonds or before the
delivery of such Bonds, such manual or facsimile signature shall nevertheless be valid and
sufficient for all purposes as if such officer had remained in such office.
(c) Except as provided below, no Bond shall be valid or obligatory for any purpose or
be entitled to any security or benefit of this Ordinance unless and until there appears thereon
the Registrar's Authentication Bond substantially in the form provided herein, duly authenticated
by manual execution by an officer or duly authorized signatory of the Registrar. In lieu of the
executed Registrar's Authentication Bond described above, the Initial Bond delivered at the
Closing Date shall have attached hereto the Comptroller's Registration Certificate substantially
in the form provided herein, manually executed by the Comptroller, or by his duly authorized
agent, which certificate shall be evidence that the Initial Bond has been duly approved by the
Attorney General of the State of Texas and that it is a valid and binding obligation of the City,
and has been registered by the Comptroller.
(d) On the Closing Date, the Initial Bond, being a single bond representing the entire
principal amount of the Bonds, payable in stated installments to the Underwriter or its designee,
executed by manual or facsimile signature of the Mayor and City Secretary of the City, approved
by the Attorney General, and registered and manually signed by the Comptroller, shall be
delivered to the Underwriter or its designee. Upon payment for the Initial Bond, the Registrar
shall cancel the Initial Bond and deliver definitive Bonds to DTC.
7. Payment of Principal and Interest. The Registrar is hereby appointed as the
paying agent and registrar for the Bonds. The principal of the Bonds shall be payable, without
exchange or collection charges, in any coin or currency of the United States of America which,
on the date of payment, is legal tender for the payment of debts due the United States of
America, upon their presentation and surrender as they respectively become due and payable
at the principal payment office of the Registrar. The interest on each Bond shall be payable on
each Interest Payment Date, by check mailed by the Registrar on or before the Interest
Payment Date to the Owner of record as of the Record Date.
If the date for payment of the principal of or interest on any Bond is not a Business no
then the date for such payment shall be the next succeeding Business Day with the same force
and effect as if made on the date payment was originally due.
8. Successor Registrars. The City covenants that at all times while any Bonds are
outstanding it will provide a commercial bank or trust company, organized under the laws of the
United States or any state, and duly qualified and legally authorized to serve as Registrar for the
Bonds. The City reserves the right to change the Registrar on not less than 60 days written
notice to the Registrar, so long as any such notice is effective not less than 60 days prior to the
next succeeding principal or interest payment date on the Bonds. Promptly upon the
appointment of any successor Registrar, the previous Registrar shall deliver the Register or
copies thereof to the new Registrar, and the new Registrar shall notify each Owner, by United
States mail, first class postage prepaid, of such change and of the address of the new Registrar.
Each Registrar hereunder, by acting in that capacity, shall be deemed to have agreed to the
provisions of this Section.
9. Special Record Date. If interest on any Bond is not paid on any Interest Payment
Date and continues unpaid for thirty (30) days thereafter, the Registrar shall establish a new
record date for the payment of such interest, to be known as a Special Record Date. The
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Registrar shall establish a Special Record Date when funds to make such interest payment are
received from or on behalf of the City. Such Special Record Date shall be fifteen (15) days prior
to the date fixed for payment of such past due interest, and notice of the date of payment and
the Special Record Date shall be sent by United States mail, first class, postage prepaid, not
later than five (5) days prior to the Special Record Date, to each affected Owner of record as of
the close of business on the day prior to the mailing of such notice.
10. Ownership; Unclaimed Principal and Interest. The City, the Registrar and any
other person may treat the person in whose name any Bond is registered as the absolute owner
of such Bond for the purpose of making and receiving payment of the principal of or interest on
such Bond, and for all other purposes, whether or not such Bond is overdue, and neither the
City nor the Registrar shall be bound by any notice or knowledge to the contrary. All payments
made to the person deemed to be the Owner of any Bond in accordance with this Section shall
be valid and effectual and shall discharge the liability of the City and the Registrar upon such
Bond to the extent of the sums paid.
Amounts held by the Registrar which represent principal of and interest on the Bonds
remaining unclaimed by the Owner after the expiration of three years from the date such
amounts have become due and payable shall be reported and disposed of by the Registrar in
accordance with the applicable provisions of Texas law including, to the extent applicable, Title
6 of the Texas Property Code, as amended.
11. Registration, Transfer, and Exchange. So long as any Bonds remain
outstanding, the Registrar shall keep the Register at its principal payment office, and, subject to
such reasonable regulations as it may prescribe, the Registrar shall provide for the registration
and transfer of Bonds in accordance with the terms of this Ordinance.
Each Bond shall be transferable only upon the presentation and surrender thereof at the
principal payment office of the Registrar, duly endorsed for transfer, or accompanied by an
assignment duly executed by the registered Owner or his authorized representative in form
satisfactory to the Registrar. Upon due presentation of any Bond for transfer, the Registrar shall
authenticate and deliver in exchange therefor, within three Business Days after such
presentation, a new Bond or Bonds registered in the name of the transferee or transferees, in
authorized denominations and of the same maturity and aggregate principal amount and
bearing interest at the same rate as the Bond or Bonds so presented.
All Bonds shall be exchangeable upon presentation and surrender thereof at the
principal payment office of the Registrar, for a Bond or Bonds of like maturity and interest rate
and in any authorized denomination, in an aggregate amount equal to the unpaid principal
amount of the Bond or Bonds presented for exchange. The Registrar shall be and is hereby
authorized to authenticate and deliver exchange Bonds in accordance with the provisions of this
Section. Each Bond delivered in accordance with this Section shall be entitled to the benefits
and security of this Ordinance to the same extent as the Bond or Bonds in lieu of which such
Bond is delivered.
The City or the Registrar may require the Owner of any Bond to pay a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection with the transfer
or exchange of such Bond. Any fee or charge of the Registrar for such transfer or exchange
shall be paid by the City.
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12. Mutilated Lost or Stolen Bonds. Upon the presentation and surrender to the
Registrar of a mutilated Bond, the Registrar shall authenticate and deliver in exchange therefor
a replacement Bond of like maturity, interest rate, and principal amount, bearing a number not
contemporaneously outstanding. If any Bond is lost, apparently destroyed, or wrongfully taken,
the City, pursuant to the applicable laws of the State of Texas and in the absence of notice or
knowledge that such Bond has been acquired by a bona fide purchaser, shall authorize and the
Registrar shall authenticate and deliver a replacement Bond of like maturity, interest rate and
principal amount, bearing a number not contemporaneously outstanding.
The City or the Registrar may require the Owner of a mutilated Bond to pay a sum
sufficient to cover any tax or other governmental charge that may be imposed in connection
therewith and any other expenses connected therewith, including the fees and expenses of the
Registrar. The City or the Registrar may require the Owner of a lost, apparently destroyed or
wrongfully taken Bond, before any replacement Bond is issued, to:
(i) furnish to the City and the Registrar satisfactory evidence of the ownership of
and the circumstances of the loss, destruction or theft of such Bond;
(ii) furnish such security or indemnity as may be required by the Registrar and the
City to save them harmless;
(iii) pay all expenses and charges in connection therewith, including, but not limited
to, printing costs, legal fees, fees of the Registrar and any tax or other
governmental charge that may be imposed; and
(iv) meet any other reasonable requirements of the City and the Registrar.
If, after the delivery of such replacement Bond, a bona fide purchaser of the original Bond in lieu
oI which such replacement Bond was issued presents for payment such original Bond, the City
and the Registrar shall be entitled to recover such replacement Bond from the person to whom it
was delivered or any person taking therefrom, except a bona fide purchaser, and shall be
entitled to recover upon the security or indemnity provided therefor to the extent of any loss,
damage, cost or expense incurred by the City or the Registrar in connection therewith.
If any such mutilated, lost, apparently destroyed or wrongfully taken Bond has become
or is about to become due and payable, the City in its discretion may, instead of issuing a
replacement Bond, authorize the Registrar to pay such Bond.
Each replacement Bond delivered in accordance with this Section shall be entitled to the
benefits and security of this Ordinance to the same extent as the Bond or Bonds in lieu of which
such replacement Bond is delivered.
13. Cancellation of Bonds. All Bonds paid in accordance with this Ordinance, and all
Bonds in lieu of which exchange Bonds or replacement Bonds are authenticated and delivered
in accordance herewith, shall be canceled and destroyed upon the making of proper records
regarding such payment. The Registrar shall furnish the City with appropriate certificates of
destruction of such Bonds.
14, Book -Entry Only System. (a) The Initial Bond shall be registered in the name of
the Underwriters. Except as provided in Section 15 hereof, all other Bonds shall be registered
in the name of Cede & Co., as nominee of DTC.
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(b) With respect to Bonds registered in the name of Cede & Co., as nominee of
DTC, the City and the Registrar shall have no responsibility or obligation to any DTC Participant
or to any person on behalf of whom such DTC Participant holds an interest in the Bonds, except
as provided in this Ordinance. Without limiting the immediately preceding sentence, the City
and the Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the
records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in
the Bonds, (ii) the delivery to any DTC Participant or any other person, other than an Owner, as
shown on the Register, of any notice with respect to the Bonds, including any notice of
redemption, or (iii) the payment to any DTC Participant or any other person, other than an
Owner, as shown on the Register, of any amount with respect to principal of, premium, if any, or
interest on the Bonds. Notwithstanding any other provision of this Ordinance to the contrary,
the City and the Registrar shall be entitled to treat and consider the person in whose name each
Bond is registered in the Register as the absolute Owner of such Bond for the purpose of
payment of principal of and interest on the Bonds, for the purpose of giving notices of
redemption and other matters with respect to such Bond, for the purpose of registering transfer
with respect to such Bond, and for all other purposes whatsoever. The Registrar shall pay all
principal of, premium, if any, and interest on the Bonds only to or upon the order of the
respective Owners, as shown in the Register as provided in this Ordinance, or their respective
attorneys duly authorized in writing, and all such payments shall be valid and effective to fully
satisfy and discharge the City's obligations with respect to payments of principal, premium, if
any, and interest on the Bonds to the extent of the sum or sums so paid. No person other than
an Owner, as shown in the Register, shall receive a Bond certificate evidencing the obligation of
the City to make payments of amounts due pursuant to this Ordinance. Upon delivery by DTC
to the Registrar of written notice to the effect that DTC has determined to substitute a new
nominee in place of Cede & Co., and subject to the provisions of this Ordinance with respect to
interest checks being mailed to the Owner of record as of the Record Date, the phrase "Cede &
Co." in this Ordinance shall refer to such new nominee of DTC.
15. Successor Securities Depository; Transfer Outside Book -Entry Only System. In
the event that the City in its sole discretion, determines that the beneficial owners of the Bonds
be able to obtain certificated Bonds, or in the event DTC discontinues the services described
herein, the City shall (i) appoint a successor securities depository, qualified to act as such under
Section 17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC
Participants, as identified by DTC, of the appointment of such successor securities depository
and transfer one or more separate Bonds to such successor securities depository or (ii) notify
DTC and DTC Participants, as identified by DTC, of the availability through DTC of Bonds and
transfer one or more separate Bonds to DTC Participants having Bonds credited to their DTC
accounts, as identified by DTC. In such event, the Bonds shall no longer be restricted to being
registered in the Register in the name of Cede & Co., as nominee of DTC, but may be
registered in the name of the successor securities depository, or its nominee, or in whatever
name or names Owners transferring or exchanging Bonds shall designate, in accordance with
the provisions of this Ordinance.
16. Payments to Cede & Co. Notwithstanding any other provision of this Ordinance
to the contrary, so long as any Bonds are registered in the name of Cede & Co., as nominee of
DTC, all payments with respect to principal of, premium, if any, and interest on such Bonds, and
all notices with respect to such Bonds, shall be made and given, respectively, in the manner
provided in the Blanket Letter of Representations.
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17. Optional and/or Mandatory Redemption; Defeasance, The Bonds are subject to
optional and/or mandatory redemption as set forth in the Form of Bond in this Ordinance and in
the Officer's Pricing Certificate.
Principal amounts may be redeemed only in integral multiples of $5,000. If a Bond
subject to redemption is in a denomination larger than $5,000, a portion of such Bond may be
redeemed, but only in integral multiples of $5,000, Upon surrender of any Bond for redemption
in part, the Registrar, in accordance with Section 11 hereof, shall authenticate and deliver in
exchange therefor a Bond or Bonds of like maturity and interest rate in an aggregate principal
amount equal to the unredeemed portion of the Bond so surrendered.
Notice of any redemption identifying the Bonds to be redeemed in whole or in part shall
be given by the Registrar at least thirty days prior to the date fixed for redemption by sending
written notice by first class mail to the Owner of each Bond to be redeemed in whole or in part at
the address shown on the Register. Such notices shall state the redemption date, the
redemption price, the place at which Bonds are to be surrendered for payment and, if less than
all Bonds outstanding of a particular maturity are to be redeemed, the numbers of the Bonds or
portions thereof of such maturity to be redeemed. Any notice given as provided in this Section
shall be conclusively presumed to have been duly given, whether or not the Owner receives
such notice. By the date fixed for redemption, due provision shall be made with the Registrar
for payment of the redemption price of the Bonds or portions thereof to be redeemed, plus
accrued interest to the date fixed for redemption. When Bonds have been called for redemption
in whole or in part and due provision has been made to redeem same as herein provided, the
Bonds or portions thereof so redeemed shall no longer be regarded as outstanding except for
the purpose of receiving payment solely from the funds so provided for redemption, and the
rights of the Owners to collect interest which would otherwise accrue after the redemption date
on any Bond or portion thereof called for redemption shall terminate on the date fixed for
redemption.
The City reserves the right to give notice of its election or direction to optionally redeem
Bonds conditioned upon the occurrence of subsequent events. Such notice may state (i) that
the redemption is conditioned upon the deposit of moneys and/or authorized securities, in an
amount equal to the amount necessary to effect the redemption, with the Paying
Agent/Registrar, or such other entity as may be authorized by law, no later than the redemption
date or (ii) that the City retains the right to rescind such notice at any time prior to the scheduled
redemption date if the City delivers a certificate of the City to the Paying Agent/Registrar
instructing the Paying Agent /Registrar to rescind the redemption notice, and such notice of
redemption shall be of no effect if such moneys and/or authorized securities are no so deposited
or if the notice is rescinded. The Paying Agent/Registrar shall give prompt notice of any such
rescission of a conditional notice of redemption to the affected owners. Any Bonds subject to
conditional redemption where redemption has been rescinded shall remain Outstanding.
The Bonds may be discharged, defeased, redeemed or refunded in any manner now or
hereafter permitted by law, unless otherwise provided in the Officer's Pricing Certificate.
18, Forms. The form of the Bond, including the form of Registration Certificate of the
Comptroller, which shall be attached or affixed to the Initial Bond, the form of Assignment and
the form of the Registrar's Authentication Certificate, shall be, respectively, substantially as
follows, with such additions, deletions and variations as may be necessary to conform to the
terms specified in the Officer's Pricing Certificate:
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(a) For of Bond.
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTIES OF BRAZORIA, FORT BEND AND HARRIS
REGISTERED REGISTERED
NUMBER DENOMINATION
INTEREST RATE
REGISTERED OWNER:
PRINCIPAL AMOUNT:
CITY OF PEARLANDI TEXAS
PERMANENTIMPROVEMENT 2
MATURITY DATE: DATED DATE:
March 1, 20_ 2
CUSIP
DOLLARS
The City of Pearland, Texas (the "City") promises to pay to the registered owner
identified above, or registered assigns, on the maturity date specified above, upon presentation
and surrender of this Bond at the principal payment office of Wells Fargo Bank, N.A. (the
'Registrar"), the principal amount identified above, payable in any coin or currency of the United
States of America which on the date of payment is legal tender for the payment of debts due the
United States of America, and to pay interest thereon at the rate shown above, calculated on
the basis of a 360-day year of twelve 30-day months, from 2 or the most recent interest
payment date to which interest has been paid or duly provided for. Interest on this Bond is
payable by check on March 1 and September 1 beginning on 2 mailed to the registered
owner of record as of the close of business on the 15th day of the month preceding each
interest payment date.
THIS BOND is one of a duly authorized issue of Bonds, aggregating $ s (the
"Bonds"), issued for the purpose of refunding a portion of the City's outstanding obligations,
under and in strict conformity with the Constitution and laws of the State of Texas, particularly
Chapters 1207 and 1371, Texas Government Code, as amended, and pursuant to an ordinance
adopted by the City Council (the "Ordinance"), which Ordinance is of record in the official
minutes of the City.
THE CITY RESERVES THE RIGHT, at its option, to redeem Bonds maturing on and
after March 1, 20 a , in whole or from time to time in part, in integral multiples of $5,000, on
March 11 20 e , or any date thereafter at par plus accrued interest on the principal amounts
a Insert from Officers Pricing Certificate
s Insert from Officers Pricing Certificate.
Insert fi om Officers Pricing Certificate.
s Insert fi•om Officers Pricing Certificate.
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called for redemption to the date fixed for redemption. If less than all the Bonds are to be
redeemed, the City shall select the Bonds to be redeemed.
[If applicable, mandatory redemption languagej
NOTICE OF ANY REDEMPTION shall be given by the Registrar at least thirty (30) days
prior to the date fixed for redemption by first class mail, addressed to the registered owners of
each Bond to be redeemed in whole or in part at the address shown on the books of registration
kept by the Registrar. When Bonds or portions thereof have been called for redemption, and
due provision has been made to redeem the same, the principal amounts so redeemed shall be
payable solely from the funds provided for redemption, and interest which would otherwise
accrue on the amounts called for redemption shall terminate on the date fixed for redemption.
THIS BOND IS TRANSFERABLE only upon presentation and surrender at the principal
payment office of the Registrar, duly endorsed for transfer or accompanied by an assignment
July executed by the registered owner or his authorized representative, subject to the terms and
conditions of the Ordinance.
THE BONDS ARE EXCHANGEABLE at the principal payment office of the Registrar, for
Bonds in the principal amount of $5,000 or any integral multiple thereof, subject to the terms
and conditions of the Ordinance.
THIS BOND shall not be valid or obligatory for any purpose or be entitled to any benefit
under the Ordinance unless this Bond is either (i) registered by the Comptroller of Public
Accounts of the State of Texas by registration certificate attached or affixed hereto or
(ii) authenticated by the Registrar by due execution of the authentication certificate endorsed
hereon.
THE REGISTERED OWNER of this Bond, by acceptance hereof, acknowledges and
agrees to be bound by all the terms and conons of the Ordinance.
THE CITY has covenanted in the Ordinance that it will at all times provide a legally
qualified registrar for the Bonds and will cause notice of any change of registrar to be mailed to
each registered owner.
IT IS HEREBY certified, recited and covenanted that this Bond has been duly and validly
issued and delivered; that all acts, conditions and things required or proper to be performed, to
exist and to be done precedent to or in the issuance and delivery of this Bond have been
performed, exist and have been done in accordance with law; and that annual ad valorem taxes,
within the limits prescribed by law, sufficient to provide for the payment of the interest on and
principal of this Bond, as such interest comes due and such principal matures, have been levied
and ordered to be levied against all taxable property in the City, and have been pledged
irrevocably for such payment.
IN WITNESS WHEREOF, this Bond has been signed with the manual or facsimile
signature of the Mayor and countersigned with the manual or facsimile signature of the City
Secretary, and the official seal of the City has been duly impressed, or placed in facsimile, on
this Bond.
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4143-2215-1718.1
(AUTHENTICATION
CERTIFICATE)
(SEAL) CITY OF PEARLAND, TEXAS
Mayor
City Secretary
(b) Form of Registration Cercate of 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.
(SEAL)
WITNESS MY SIGNATURE AND SEAL this
Comptroller of Public Accounts
of the State of Texas
(c) Form of Registrar's Authentication Certificate.
AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been delivered pursuant to the Bond Ordinance
described in the text of this Bond.
Wells Fargo Bank, N.A.
As Paying Agent/Registrar
(d)
Authorized Signature
Date of Authentication
Form of Assignment.
ASSIGNMENT
For value received, the undersigned
hereby sells, assigns, and transfers unto
(Please print or type name, address, and zip code of Transferee)
(Please insert Social Security or Taxpayer Identification Number of Transferee)
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
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4143-2215-1718.1
attorney to transfer said Bond on the books kept for registration thereof, with full power of
substitution in the premises.
DATED:
Signature Guaranteed:
NOTICE: Signature must be guaranteed by a
member firm of the New York Stock Exchange
or a commercial bank or trust company.
Registered Owner
NOTICE: The signature above must
correspond to the name of the registered
owner
as shown on the face of this Bond in every
particular, without any alteration, enlargement
or change whatsoever.
(e) The Initial Bond shall be in the form set forth in paragraphs (a), (b) and (d) of this
Section, except for the following alterations:
(i) immediately under the name of the Bond, the headings "INTEREST RATE" and
"MATURITY DATE" shall both be completed with the words "As Shown Below"
and the word "CUSIP" deleted;
(ii) in the first paragraph of the Bond, the words "on the maturity date specified
above" and at the rate shown above" shall be deleted and the following shall be
inserted at the end of the first sentence "..., with such principal to be paid in
installments on March 1 in each of the years and in the principal amounts
identified in the following schedule and with such installments bearing interest at
the per annum rates set forth in the following schedule:
[Information to be inserted from the Officer's Pricing Certificate]
the Initial Bond shall be numbered I-1.
19. CUSIP Numbers. CUSIP Numbers may be printed on the Bonds, but errors or
omissions in the printing of such numbers shall have no effect on the validity of the Bonds.
20, Debt Service Fund; Tax Levy. There is hereby established a separate fund of
the City to be known as the City of Pearland, Texas, Permanent Improvement s Debt
Service Fund (the "Debt Service Fund"), which shall be kept separate and apart from all other
funds of the City. The proceeds from all taxes levied, assessed and collected for and on
account of the Bonds authorized by this Ordinance shall be deposited, as collected, in the Debt
Service Fund. While the Bonds or any part of the principal thereof or interest thereon remain
outstanding and unpaid, there is hereby levied and there shall be annually assessed and
collected in due time, form and manner, and at the same time as other City taxes are assessed,
levied and collected, in each year, a continuing direct annual ad valorem tax, within the limits
prescribed by law, upon all taxable property in the City, sufficient to pay the current interest on
the Bonds as the same becomes due and to provide and maintain a debt service fund of not
less than two percent of the principal amount of the Bonds or the amount required to pay each
� Insert fi•om Officers Pricing Certificate.
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installment of principal of the Bonds as the same matures, whichever is greater, full allowance
being made for delinquencies and costs of collection, and said taxes are hereby irrevocably
pledged to the payment of the interest on and principal of the Bonds and to no other purpose.
To pay the debt service coming due on the Bonds prior to receipt of the taxes levied to
pay such debt service, there is hereby appropriated from current funds on hand, which are
hereby certified to be on hand and available for such purpose, an amount sufficient to pay such
debt service, and such amount shall be used for no other purpose.
21. Application of Chapter 1208, Government Code. Chapter 1208, Government
Code, applies to the issuance of the Bonds and the pledge of the taxes granted by the City
under Section 20 of this Ordinance, and such pledge is therefore valid, effective and perfected.
If Texas law is amended at any time while the Bonds are outstanding an unpaid such that the
pledge of the taxes granted by the City under Section 20 of this Ordinance is to be subject to the
filing requirements of Chapter 9, Business & Commerce Code, then in order to preserve to the
registered owners of the Bonds the perfection of the security interest in said pledge, the City
agrees to take such measures as it determines are reasonable and necessary under Texas law
to comply with the applicable provisions of Chapter 9, Business & Commerce Code and enable
a filing to perfect the security interest in said pledge to occur.
22. Further Proceedings. After the Initial Bond has been executed, it shall be the
duty of the Mayor and other appropriate officials and agents of the City to deliver the Initial Bond
and all pertinent records and proceedings to the Attorney General of the State of Texas, for
examination and approval. After the Initial Bond has been approved by the Attorney General, it
shall be delivered to the Comptroller for registration. Upon registration of the Initial Bond, the
Comptroller (or the Comptroller's bond clerk or an assistant bond clerk lawfully designated in
writing to act for the Comptroller) shall manually sign the Comptroller's Registration Certificate
prescribed herein and the seal of said Comptroller shall be impressed, or placed in facsimile,
thereon.
23. Sale; Bond Purchase Agreement. The Bonds shall be sold and delivered to the
Underwriter, who shall be designated in the Pricing Officer's Certificate, at the price set forth in
the Pricing Officer's Certificate and in accordance with the terms of the Bond Purchase Contract
which the Pricing Officer is hereby authorized and directed to execute on behalf of the City. The
Pricing Officer and all other officers, agents and representatives of the City are hereby
authorized to do any and all things necessary or desirable to satisfy the conditions set out
therein and to provide for the issuance and delivery of the Bonds. The Pricing Officer is hereby
authorized and directed to execute the Bond Purchase Agreement on behalf of the City, and the
Mayor, City Manager, Deputy City Manager, Director of Finance or Interim Director of Finance
and all other officers, agents and representatives of the City are hereby authorized to do any
and all things necessary or desirable to satisfy the conditions set out therein and to provide for
the issuance and delivery of the Bonds. In the event the Bond Purchase Agreement shall not
be executed by the one year anniversary of the date of this Ordinance (the "Expiration Date"),
the delegation to the Pricing Officer pursuant to this Ordinance shall cease to be effective
unless the City shall act to extend such delegation. Bonds sold pursuant to a Bond Purchase
Agreement or winning bid form executed on or before the Expiration Date may be delivered
after such date.
24. Federal Income Tax Exclusion.
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The City intends that the interest on the Bonds shall be excludable from gross income of
the owners thereof for federal income tax purposes pursuant to Sections 103 and 141 through
150 of the Internal Revenue Code of 1986, as amended, (the "Code") and all applicable
temporary, proposed and final regulations (the "Regulations") and procedures promulgated
thereunder and applicable to the Bonds. For this purpose, the City covenants that it will monitor
and control the receipt, investment, expenditure and use of all gross proceeds of the Bonds
(including all property, the acquisition, construction or improvement of which is to be financed
directly or indirectly with the proceeds of the Bonds) and take or omit to take such other and
further actions as may be required by Sections 103 and 141 through 150 of the Code and the
Regulations to cause the interest on the Bonds to be and remain excludable from the gross
income, as defined in Section 61 of the Code, of the owners of the Bonds for federal income tax
purposes. Without limiting the generality of the foregoing, the City shall comply with each of the
following covenants:
(a) The City shall not use, permit the use of or omit to use Gross Proceeds or any
other amounts (or any property the acquisition, construction or improvement of which is to be
financed directly or indirectly with Gross Proceeds) in a manner which, if made or omitted,
respectively, would cause the interest on any Bond to become includable in the gross income,
as defined in Section 61 of the Code, of the owner thereof for federal income tax purposes.
Without limiting the generality of the foregoing, unless and until the City shall have received a
written opinion of counsel nationally recognized in the field of municipal bond law to the effect
that failure to comply with such covenant will not adversely affect the exemption from federal
income tax of the interest on any Bond, the City shall comply with each of the specific covenants
in this Section.
(b) Except as permitted by Section 141 of the Code and the regulations and rulings
thereunder, the City shall, at all times prior to the last stated maturity of the Bonds,
(1) exclusively own, operate, and possess all property the acquisition,
construction, or improvement of which is to be financed directly or indirectly with Gross
Proceeds of such series of the Bonds (including property financed with Gross Proceeds
of the Refunded Bonds or notes or bonds refunded by the Refunded Bonds and not use
or permit the use of such Gross Proceeds or any property acquired, constructed, or
improved with such Gross Proceeds in any activity carried on by any person or entity
other than a state or local government, unless such use is solely as a member of the
general public, or
(2) not directly or indirectly impose or accept any charge or other payment for
use of Gross Proceeds of such series of the Bonds or any property the acquisition,
construction or improvement of which is to be financed directly or indirectly with such
Gross Proceeds (including property financed with Gross Proceeds of the Refunded
Bonds or notes or bonds refunded by the Refunded Bonds other than taxes of general
application and interest earned on investments acquired with such Gross Proceeds
pending application for their intended purposes.
(c) Except to the extent permitted by Section 141 of the Code and the regulations
and rulings thereunder, the City shall not use Gross Proceeds of the Bonds to make or finance
loans to any person or entity other than a state or local government. For purposes of the
foregoing covenant, Gross Proceeds are considered to be "loaned" to a person or entity if
(1) property acquired, constructed or improved with Gross Proceeds (including property
financed with Gross Proceeds of the Refunded Bonds or notes or bonds refunded by the
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Refunded Bonds is sold or leased to such person or entity in a transaction which creates a debt
for federal income tax purposes, (2) capacity in or service from such property is committed to
such person or entity under a take -or -pay, output, or similar contract or arrangement, or
(3) indirect benefits, or burdens and benefits of ownership, of such Gross Proceeds or such
property are otherwise transferred in a transaction which is the economic equivalent of a loan.
(d) Except to the extent permitted by Section 148 of the Code and the regulations
and rulings thereunder, the City shall not, at any time prior to the earlier of the final stated
maturity or final payment of the Refunded Bonds, directly or indirectly invest Gross Proceeds of
such Bonds in any Investment (or use such Gross Proceeds to replace money so invested), if
as a result of such investment the Yield of all Investments allocated to such Gross Proceeds
whether then held or previously disposed of, exceeds the Yield on the Refunded Bonds.
(e) Based on all of the facts and estimates now known or reasonably expected to be
in existence on the date the Bonds are delivered, the City reasonably expects that the proceeds
of the Bonds and the Refunded Bonds (to the extent any of such proceeds remain unexpended)
will not be used in a manner that would cause the Bonds or the Refunded Bonds or any portion
thereof to be "arbitrage bonds" within the meaning of Section 148 of the Code.
(f) At all times while the Bonds are outstanding, the City will identify and properly
account for all amounts constituting gross proceeds of the Bonds in accordance with the
Regulations. The City will monitor the yield on the investments of the proceeds of the Bonds
and, to the extent required by the Code and the Regulations, will restrict the yield on such
investments to a yield which is not materially higher than the yield on the Bonds. To the extent
necessary to prevent the Bonds from constituting "arbitrage bonds," the City will make such
payments as are necessary to cause the yield on all yield restricted nonpurpose investments
allocable to the Bonds to be less than the yield that is materially higher than the yield on the
Bonds.
(g) The City will not take any action or knowingly omit to take any action, if taken or
omitted, would cause the Bonds to be treated as "federally guaranteed" obligations for purposes
of Section 149(b) of the Code.
(h) The City represents that not more than fifty percent (50%) of the proceeds of any
new money portion of the Bonds or any new money issue refunded by, the Refunded Bonds
was invested in nonpurpose investments (as defined in Section 148(f)(b)(A) of the Code) having
a substantially guaranteed yield for four years or more within the meaning of
Section 149(g)(3)(A)(ii) of the Code, and the City reasonably expected at the time each issue of
the Refunded Bonds was issued that at least eighty-five percent (85%) of the spendable
proceeds of the Bonds or the Refunded Bonds would be used to carry out the governmental
purpose of such Bonds within the corresponding three-year period beginning on the respective
dates of the Bonds or the Refunded Bonds.
(i) The City will take all necessary steps to comply with the requirement that certain
amounts earned by the City on the investment of the gross proceeds of the Bonds, if any, be
rebated to the federal government. Specifically, the City will (i) maintain records regarding the
receipt, investment and expenditure of the gross proceeds of the Bonds as may be required to
calculate such excess arbitrage profits separately from records of amounts on deposit in the
funds and accounts of the City allocable to other obligations of the City or moneys which do not
represent gross proceeds of any obligations of the City and retain such records for at least six
years after the day on which the last outstanding Bond is discharged, (ii) account for all gross
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4143-2215-1718.1
proceeds under a reasonable, consistently applied method of accounting, not employed as an
artifice or device to avoid, in whole or in part, the requirements of Section 148 of the Code,
including any specified method of accounting required by applicable Regulations to be used for
all or a portion of the gross proceeds, (iii) calculate, at such times as are required by applicable
Regulations, the amount of excess arbitrage profits, if any, earned from the investment of the
gross proceeds of the Bonds and (iv) timely pay, as required by applicable Regulations, all
amounts required to be rebated to the federal government. In addition, the City will exercise
reasonable diligence to assure that no errors are made in the calculations required by the
preceding sentence and, if such an error is made, to discover and promptly correct such error
within a reasonable amount of time thereafter, including payment to the federal government of
any delinquent amounts owed to it, including interest thereon and penalty.
(j) The City will not indirectly pay any amount otherwise payable to the federal
government pursuant to the foregoing requirements to any person other than the federal
government by entering into any investment arrangement with respect to the gross proceeds of
the Bonds that might result in a reduction in the amount required to be paid to the federal
government because such arrangement results in smaller profit or a larger loss than would have
resulted if such arrangement had been at arm's length and had the yield on the issue not been
relevant to either party.
(k) The City will timely file or cause to be filed with the Secretary of the Treasury of
the United States the information required by Section 149(e) of the Code with respect to the
Bonds on such form and in such place as the Secretary may prescribe.
(I) The City will not issue or use the Bonds as part of an "abusive arbitrage device"
as defined in Section 1.148 10(a) of the Regulations). Without limiting the foregoing, the Bonds
are not and will not be a part of a transaction or series of transactions that attempts to
circumvent the provisions of Section 148 of the Code and the Regulations, by (i) enabling the
City to exploit the difference between tax exempt and taxable interest rates to gain a material
financial advantage, or (ii) increasing the burden on the market for tax-exempt obligations.
(m) Proper officers of the City charged with the responsibility for issuing the Bonds
are hereby directed to make, execute and deliver certifications as to facts, estimates or
circumstances in existence as of the Issue Date and stating whether there are facts, estimates
or circumstances that would materially change the City's expectations. On or after the Issue
Date, the City will take such actions as are necessary and appropriate to assure the continuous
accuracy of the representations contained in such certificates.
(n) The covenants and representations made or required by this Section are for the
benefit of the Bond holders and any subsequent Bond holder, and may be relied upon by the
Bond holder and any subsequent Bond holder and bond counsel to the City.
In complying with the foregoing covenants, the City may rely upon an unqualified opinion
issued to the City by nationally recognized bond counsel that any action by the City or reliance
upon any interpretation of the Code or Regulations contained in such opinion will not cause
interest on the Bonds to be includable in gross income for federal income tax purposes under
existing law.
Notwithstanding any other provision of this Ordinance, the City's representations and
obligations under the covenants and provisions of this Section 7.5 shall survive the defeasance
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and discharge of the Bonds for as long as such matters are relevant to the exclusion of interest
on the Bonds from the gross income of the owners for federal income tax purposes.
25. Use of Proceeds. Proceeds
receipt by the City, be applied as follows:
from the sale of the Bonds shall, promptly upon
(a) Accrued interest in the amount of $ ' and, if necessary, net premium on the
Bonds in the amount of $ e , shall be deposited into the Debt Service Fund.
(b) Premium in the amount of $ s shall be used to pay the underwriter's discount.
(c) Net premium in the amount of $ 10 shall be used to pay the costs of issuance.
(d) The remaining proceeds from the sale of the Bonds, together with other available
funds of the City (in the amount of $ " ), shall be applied to establish an escrow fund to
refund the Refunded Bonds or a deposit with the paying agent for the Refunded Bonds, as more
fully provided in Section 26 below, and, to the extent not otherwise provided for, to pay all
expenses arising in connection with the issuance of the Bonds, the establishment of such
escrow fund and the refunding of the Refunded Bonds.
(e) Any proceeds of the Bonds remaining after making all such deposits and
payments shall be deposited into the Debt Service Fund.
26. Escrow Agreement/Deposit with Payinq Agent for Refunding Bonds. If
Refunding Bonds are issued, the discharge and defeasance of the Refunded Bonds may be
effectuated pursuant to the terms and provisions of an Escrow Agreement to be entered into by
and between the City and the Escrow Agent or pursuant to a deposit of funds with the paying
agent for the Refunded Bonds. The terms and provisions of an Escrow Agreement or other
deposit agreement, if needed, are hereby approved, subject to such insertions, additions and
modifications as shall be necessary to carry out the terms of this Ordinance and the Pricing
Certificate. The mathematical accuracy of the terms of the refunding shall be certified to by
verification agent or by a certificate of sufficiency of deposit executed by the City's financial
advisor or the paying agent for the Refunded Bonds. The Mayor is hereby authorized to
execute and deliver such Escrow Agreement or other such deposit agreement on behalf of the
City in multiple counterparts and the Secretary or the Assistant Secretary is hereby authorized
to attest thereto and affix the City's seal.
27. Redemption of Refunded Bonds. If Refunding Bonds are issued, the City has
irrevocably exercised its option to call the bonds of the City for redemption prior to maturity on
the dates and at the prices shown on Exhibit C to the Officer's Pricing Certificate, and
authorized and directed notice of such redemption to be given in accordance with the
ordinances authorizing the issuance of such bonds.
28. Purchase of Escrowed Securities. If an Escrow Agreement is utilized, to assure
the purchase of the Escrowed Securities referred to in the Escrow Agreement, if required, the
Pricing Officer is hereby authorized to subscribe for, agree to purchase, and purchase
Insert from Officer's Pricing Certificate.
s Insert fi•om Officer's Pricing Certificate.
Insert from Officer's Pricing Certificate.
10 Insert from Officer's Pricing Certificate.
" Insert from Officer's Pricing Certificate.
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4143-2215-1718.1
obligations which are authorized investments for escrow
Section 1207,062, Texas Government Code, in such
interest at such rates as may be provided for in the
subscriptions, purchase agreements, commitments,
documents necessary to effectuate the foregoing, and
purpose are hereby ratified and approved.
pursuant to
and bearing
Report, and to execute any and all
letters of authorization and other
any actions heretofore taken for such
amounts and
accounts
maturities
29. Continuing Disclosure Undertaking. (a) Annual Reports. The City will provide
certain updated financial information and operating data to the MSRB annually in an electronic
format as prescribed by the MSRB and available via the Electronic Municipal Market Access
("EMMA") system at www.emma.msrb.org. Unless provided for in the Pricing Certificate, the
information to be updated includes all quantitative financial information and operating data with
respect to the City of the general type included in the final Official Statement authorized by
Section 31 of this Ordinance under Tables 1-3 and 5-13 and in APPENDIX "B." The City will
update and provide this information within six months after the end of each fiscal year.
If the City changes its fiscal year, it will submit a notice of such change to the MSRB,
and the date of the new fiscal year end prior to the next date by which the City otherwise would
be required to provide financial information and operating data pursuant to this Section.
The financial information and operating data to be provided may be set forth in full in one
or more documents or may be included by specific reference to any document available to the
public on the MSRB Is Internet Web site or filed with the SEC, as permitted by the SEC Rule.
The updated information will include audited financial statements, if the City commissions an
audit and it is completed by the required time. If audited financial statements are not available
by the required time, the City will provide unaudited financial statements by the required time
and audited financial statements when and if such audited statements become available. Any
such financial statements will be prepared in accordance with the accounting principles
described in APPENDIX B or such other accounting principles as the City may require to
employ from time to time pursuant to State law or regulation.
(b) Material Event Notices. The City shall notify the MSRB in an electronic format
prescribed by I in a timely manner (not in excess of ten (10) days after the occurrence
of the event), of any of the following events with respect to the Bonds:
(i) Principal and interest payment delinquencies;
(ii) Non-payment related defaults, if material;
(iii) Unscheduled draws on debt service reserves reflecting financial difficulties;
(iv) Unscheduled draws on credit enhancements reflecting financial difficulties;
(v) Substitution of credit or liquidity providers or their failure to perform;
(vi) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed
or final determinations of taxability, Notices of Proposed Issue (IRS Form
5701-TEB) or other material notices or determinations with respect to the tax
status of the Bonds, or other material events affecting the tax status of the
Bonds;
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4143-2215-1718.1
(vii) Modifications to rights of holders of the Bonds, if material;
(WI) Bond calls, if material, and tender offers;
(ix) Defeasances;
(x) Release, substitution, or sale of property securing repayment of the Bonds, if
material;
(xi) Rating changes;
(xii) Bankruptcy, insolvency, receivership or similar event of the City;
(xiii) 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 agreement relating to any such
actions, other than pursuant to its terms, if material;
(xiv) Appointment of a successor Paying Agent/Registrar or change in the name of the
Paying Agent/Registrar, if material;
(xv) Incurrence of a Financial Obligation of the City, if material, or agreement tc
covenants, events of default, remedies, priority rights, or other similar terms of a
Financial Obligation of the City, any of which affect security holders, if material;
and
(xvi) Default, event of acceleration, termination event, modification of terms, or other
similar events under the terms of a Financial Obligation of the City, any of which
reflect financial difficulties.
For the purposes, any event described in the immediate preceding paragraph (xii) is
considered to occur when any of the following occur: the appointment of a receiver, fiscal agent
or similar officer for the City in a proceeding Under States Bankruptcy Code or any other
proceeding under state or federal law in which a court or governmental authority has assumed
jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has
been assumed by leaving the existing governing body and officials or officers in possession but
subject to the supervision and orders of a court or governmental authority, or the entry of order
confirming a plan of reorganization, arrangement or liquidation by a court or governmental
authority having supervision or jurisdiction over substantially all of the assets or business of the
City.
The City intends the words used in the immediately preceding paragraphs (xv) and (xvi)
and the definition of Financial Obligation in this Section to have the same meanings as when
they are used in the Rule, as evidenced by SEC Release No. 34-83885, dated August 20, 2018.
The Pricing Officer is authorized and directed to establish and implement written
procedures to ensure compliance with the reporting requirements imposed by this Section.
Such procedures may be modified and amended by the Pricing Officer from time to time to the
extent the modification or amendment of such procedures are deemed necessary, useful or
appropriate.
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4143-22 15-1718. I
The City shall notify the MSRB, in a timely manner, of any failure by the City to provide
financial information or operating data in accordance this Section by the time required by such
Section.
(c) Limitations O%a a I I lul 01 and Amendments. The City shall be obligated to
observe and perform the covenants specified in this Section for so long as, but only for so long
as, the City remains an "obligated person" with respect to the Bonds within the meaning of the
Rule, except that the City in any event will give notice of any deposit made in accordance with
Texas law that causes Bonds no longer to be outstanding.
The provisions of this Section are for the sole benefit of the holders and the beneficial
owners of the Bonds, and nothing in this Section, express or implied, shall give any benefit or
any legal or equitable right, remedy, or claim hereunder to any other person. The City
undertakes to provide only the financial information, operating data, financial statements, and
notices which it has expressly agreed to provide pursuant to this Section and does not hereby
undertake to provide any other information that may be relevant or material to a complete
presentation of the City's financial results, condition, or prospects or hereby undertake to update
any information provided in accordance with this Section or otherwise, except as expressly
provided herein. The City does not make any representation or warranty concerning such
information or its usefulness to a decision to invest in or sell Bonds at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR
BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT,
FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE CITY,
WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT
SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON,
IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE
UNLIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE.
No default by the City in observing or performing its obligations under this Section shall
comprise a breach of or default under this Ordinance for purposes of any other provision of this
Ordinance.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the
duties of the City under federal and state securities laws.
The provisions of this Section may be amended by the City from time to time to adapt to
changed circumstances that arise from a change in legal requirements, a change in law, or a
change in the identity, nature, or status or type of principal payment of the City, if (1) the
agreement, as so amended, would have permitted an underwriter to purchase or sell Bonds in
the initial primary offering 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 amount of the
outstanding Bonds consent to such amendment or (b) a person unaffiliated with the City (such
as nationally recognized bond counsel) determines that the amendment will not materially
impair the interests of the holders and beneficial owners of the Bonds. The City may also
amend or repeal the provisions of this continuing disclosure agreement if the SEC amends or
repeals the applicable provisions of the Rule or a court of final jurisdiction enters judgment 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 Bonds in the
primary offering of the Bonds. If any such amendment is made, the City will include in its next
-21-
4143-2215-1718.1
annual update an explanation in narrative form of the reasons for the change and its impact on
the type of operating data or financial information being provided.
30. Related Matters. To satisfy in a timely manner all of the City's obligations under
this Ordinance, the Bond Purchase Agreement, and the Escrow Agreement, the Mayor or Mayor
Pro Tem, the City Secretary or an Assistant City Secretary, the City Manager, Deputy City
Manager, the Director of Finance or the Interim Director of Finance and all other appropriate
officers and agents of the City are hereby authorized and directed to take all other actions that
are reasonably necessary to provide for the refunding of the Refunded Bonds, including, without
limitation, executing and delivering on behalf of the City all certificates, consents, receipts,
requests, and other documents as may be reasonably necessary to satisfy the City's obligations
under the Escrow Agreement, the Bond Purchase Agreement, and this Ordinance and to direct
the application of funds of the City consistent with the provisions of the Escrow Agreement and
this Ordinance.
31. Power to Revise Form of Documents. Notwithstanding any other provision of this
the Pricing Officer is hereby authorized to make or approve such revisions, additions, deletions,
and variations to this Ordinance and in the form of the documents attached hereto as exhibits
as, in the judgment of the Pricing Officer, and in the opinion of Bond Counsel to the City, may be
necessary or convenient to carry out or assist in carrying out the purposes of this Ordinance, the
Preliminary Official Statement, the final Official Statement, or as may be required for approval of
the Bonds by the Attorney General of Texas; provided, however, that any changes to such
documents resulting in substantive amendments to the terms and conditions of the Bonds or
such documents shall be subject to the prior approval of the Board.
32. Amendments. The City may amend this Ordinance without the consent of or
notice to any Owner in any manner not detrimental to the interests of the Owners, including the
curing of any ambiguity, inconsistency, or formal defect or omission therein. In addition, the City
may with the written consent of the holders of a majority of the aggregate principal amount of
the Bonds then outstanding affected thereby, amend, add to, or rescind any of the provisions of
the Ordinance; except that, without the consent of the Owners of the Bonds affected, no such
amendment, addition or rescission may (i) make any change in the maturity of any of the
outstanding Bonds; (ii) reduce the rate of interest borne by any of the outstanding Bonds;
(iii) reduce the amount of the principal of or redemption premium, if any, payable on any
outstanding Bonds; (iv) modify the terms of payment of principal or of interest or redemption
premium on outstanding Bonds or any of them or impose any condition with respect to such
payment; or (v) change the minimum percentage of the principal amount of the Bonds
necessary for consent to such amendment.
33. Official Statement. The City Council hereby approves the form and content of
the Preliminary Official Statement prepared for the initial offering and sale of the Bonds and
hereby authorizes the preparation of a final Official Statement reflecting the terms of the Bond
Purchase Agreement and other relevant matters. The use of such Official Statement in the
reoffering of the Bonds by the Underwriter is hereby approved and authorized.
34. Registrar. The form of agreement setting forth the duties of the Registrar is
hereby approved, and the appropriate officials of the City are hereby authorized to execute such
agreement for and on behalf of the City.
-22-
4143-2215-1718.1
35. No Personal Liability. No recourse shall be had for payment of the principal of or
interest on any Bonds or for any claim based thereon, or on this Ordinance, against any official
or employee of the City or any person executing any Bonds.
36. Open Meeting. The meeting at which this Ordinance is adopted was open to the
public, via teleconference and video conference in compliance with an advisory issued by the
Office of the Governor, and public notice of the time, place and purpose of said meeting was
given, all as required by the Texas Open Meetings Act; and such notice as given is hereby
authorized, approved, adopted and ratified.
41 �F3-2215-1718. I
PASSED and APPROVED on First Reading this the 241h day of August, A. D., 2020.
c
Y
TOM REID
M AYO R
0
CRYSTAL ROAN, TRMC, CMC
CITY SECRETARY
PASSED AND APPROVED on Second and Final Reading on the 14th day of
AO
O
September, A. D., 20iN0'
TOM REID
M AYO R
C�l"STAC ROAN; TRMC, CMC
CITY SECRETARY
APPROVED AS TO FORM:
•
DARRIN M. COKER
CITY ATTORNEY
-24-
i
4143-2215-1718.1
EXHIBIT A
ALL THE CITY'S OUTSTANDING GENERAL OBLIGATION DEBT
Cercates %J Obligation, Series 2009
Certificates of Obligation, Series 2011
Permanent Improvement Bonds, Series 2011
Unlimited Tax Bonds, Series 2011 (Brazoria County MUD No. 4)
Permanent Improvement Refunding Bonds, Series 2012
Permanent Improvement Bonds, Series 2013
Certificates of Obligation, Series 2013
Permanent Improvement and Refunding Bonds, Series 2014
Certificates of Obligation, Series 2014
Permanent Improvement Refunding Bonds, Series 2015
Permanent Improvement Bonds, Series 2015
Certificates of Obligation, Series 2015
Permanent Improvement Refunding Bonds, Series 2015-A
Certificates of Obligation, Series 2016
Permanent Improvement and Refunding Bonds, Series 2016A
Permanent Improvement Refunding Bonds, Series 2016B
Permanent Improvement and Refunding Bonds, Series 2017
Certificates of Obligation, Series 2017
Permanent Improvement Bonds, Series 2018
Certificates of Obligation, Series 2018
Permanent Improvement and Refunding Bonds, Series 2019
Certificates of Obligation, Series 2019A
Certificates of Obligation, Series 2019E
Permanent Improvement Bonds, Series 2020
Certificates of Obligation, Series 2020A
Certificates of Obligation, Series 2020B
-25-
4143-2215-1718.1
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