R99-096 11-08-99RESOLUTION NO. R99-96
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PEARLAND,
TEXAS, APPROVING A BOND ORDER OF BRAZORIA COUNTY
MUNICIPAL UTILITY DISTRICT NO. 6 AUTHORIZING THE ISSUANCE OF
$4,690,000 UNLIMITED TAX BONDS, SERIES 1999.
WHEREAS, the Brazoria County Municipal Utility District No. 6 (the "District")
is located within the extraterritorial jurisdiction of the City of Pearland, Texas
(the "City"); and
WHEREAS, by Resolution No. R86-7, dated February 10, 1986, the City
consented to the creation of the District, and placed certain conditions on the issuance
of bonds by the District, including the approval by the City Council of the District's
resolution authorizing the issuance of such bonds; and
WHEREAS, the City Council has considered such a bond resolution in
connection with the issuance of the District's proposed $4,690,000 Unlimited Tax
Bonds, Series 1999, and has found it to be acceptable; now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS:
Section 1. All of the matters and facts set forth in the preamble hereof are true
and correct.
Section 2. The bond order of the board of directors of Brazoria County
Municipal Utility District No. 6, attached hereto and made a part hereof as Exhibit "A",
authorizing the issuance of its $4,690,000 Tax Bonds, Series 1999, is hereby
approved.
1
RESOLUTION NO. R99-96
Section 3. The Mayor of the City of Pearland is hereby authorized to execute
such letters or other documents required to be provided to the Attorney General of
Texas in connection with the issuance of such bonds by the District.
Section 4. This Resolution shall take effect immediately from and after its
passage in accordance with the provisions of the Charter of the City of Pearland and
it is accordingly so resolved.
PASSED, APPROVED and ADOPTED this the 8th day of
November , A. D., 1999.
ATTEST:
? U N G�y� e /
Y Sr ' ETARY
APPROVED AS TO FORM:
DARRIN M COKER
CITY ATTORNEY
2
TOM REID
MAYOR
O RDER AUTHORIZING THE ISSUANCE OF $4,690,000 UNLIMITED TAX
BONDS, SERIES 1999, PRESCRIBING THE TERMS AND PROVISIONS
THEREOF; MAKING PROVISION FOR THE PAYMENT OF THE INTEREST
THEREON AND THE PRINCIPAL THEREOF; AUTHORIZING THE SALE AND
DELIVERY THEREOF• AND CONTAINING OTHER PROVISIONS RELATING
TO THE SUBJECT
BE IT ORDERED BY THE BOARD OF DIRECTORS OF BRAZORIA COUNTY
MUNICIPAL UTILITY DISTRICT NO. 6, OF BRAZORIA COUNTY, TEXAS:
ARTICLE ONE
STATUTORY AUTHORITY, RECITALS AND FINDINGS
S ECTION 1.01: AUTHORITY FOR THE DISTRICT. Brazoria County
Municipal Utility District No. 6, of Brazoria County, Texas (the
"District") was organized, created and established as a
conservation and reclamation district by an Order of the Texas
Water Commission, predecessor to the Texas Natural Resource
Conservation Commission, dated April 1, 1987, pursuant to the
provisions of Chapter 54, V.T C.A. Water Code, as amended, and
t he provisions of Article XVI, Section 59, of the Texas
Constitution, and operates pursuant to Chapter 49 and Chapter 54,
✓ .T.C.A. Water Code, as amended ("Water Code").
S ECTION 1.02. PURPOSES OF THE DISTRICT. The District was
created and operates by and pursuant to the Water Code for the
following purposes:
(a) the control, storage, preservation and distribution of
its storm water and floodwater, the water of its rivers
and streams for irrigation, power, and all other useful
purposes;
(b) the reclamation and irrigation of its arid, semiarid,
and other land needing irrigation
(c) the reclamation and drainage of its overflowed land and
other land needing drainage;
(d) the conservation and development of its forests, water,
and hydroelectric power;
(e) the navigation of its inland and coastal water;
(f) the control, abatement, and change of any shortage or
harmful excess of water;
(g) the protection, preservation and restoration of the
purity and sanitary condition of water within the
state; and
(h) the preservation of all natural resources of the state.
SECTION 1.03: POWERS OF THE DISTRICT. The District is
authorized by the Water Code to purchase, construct, acquire,
own, operate, maintain, repair, improve, or extend inside and
outside its boundaries any and all works, improvements,
facilities, plants, equipment and appliances necessary to
accomplish the purposes of its creation, including all works,
improvements facilities, plants, equipment and appliances
incident, helpful, or necessary to:
(a) supply water for municipal uses, domestic uses, power
and commercial purposes and all other beneficial uses
or controls;
(b) collect, transport, process, dispose of and control all
domestic, industrial, or communal wastes whether in
fluid, solid, or composite state;
(c) gather, conduct, divert, and control local storm water
or other local harmful excesses of water in the
District;
(d) irrigate the land in the District;
(e) alter land elevation in the District where it is
needed; and
(f) navigate coastal and inland waters of the District.
SECTION 1.04: AUTHORITY OF THIS ORDER. The District is
authorized by the Water Code to issue bonds for the purpose of
purchasing, constructing, acquiring, owning, operating
repairing, improving, or extending any District works, improve-
ments, facilities, plants, equipment, and appliances needed to
accomplish the purposes for which the District was created,
including works, improvements, facilities, plants, equipment and
appliances needed to provide a waterworks system, sanitary sewer
system, drainage system, and solid waste disposal system, or to
make payment of sums due or to become due under contracts for
such purposes, or to refund or provide for payment of any
outstanding bonds, notes or other obligations of the District.
Said bonds are authorized by the Water Code and by V.T.C.A.
Government Code §1201.001 et seq., as amended, to be issued in
various series or issues, with or without interest coupons, in
any denomination, payable at such time or times, in such amount
or amounts or installments at such place or places, in such
form, under such terms, conditions, and details, in such manner,
redeemable prior to maturity at any time or times, bearing no
interest, or bearing interest at any rate or rates (either fixed,
variable, floating, adjustable, or otherwise), all as determined
by the Board of Directors of the District, and the Board of
Directors finds that issuance of said bonds in multiple series or
issues over an extended period of time is in the best interests
of the District in order to ensure the continuing and orderly
development of the District on terms and conditions which are
feasible and practical.
SECTION 1.05: FINDINGS. It is hereby found, determined and
declared that
(a) the matters and facts set out in this Article One are
true and correct;
(b) the creation of the District was confirmed at an
election held within and for the District on May 3,
1997;
(c) at an election held within and for the District on May
3 1997, the District was authorized to issue bonds in
maximum aggregate principal amount of $38,500 000 for
the purpose or purposes of purchasing, constructing,
acquiring, owning, operating, repairing, improving, or
extending a waterworks system, a sanitary sewer system,
and a drainage and storm sewer system, including, but
not limited to, all additions to such systems and all
works, improvements, facilities, plants, equipment,
appliances, interests in property and contract rights
needed therefor, and administrative facilities needed
in connection therewith, and to provide for the payment
of the principal of and interest on such bonds by the
levy and collection annually of a sufficient tax upon
all taxable property within the District;
(d) at an election held within and for the District on May
3, 1997, the District was authorized to issue refunding
bonds in the maximum aggregate principal amount of
$38,500,000 to provide for the refunding by any lawful
means of all or any portion of the Bonds (hereinafter
d efined), Additional Bonds (hereinafter defined) or
✓ efunding bonds payable in whole or in part from taxes;
(e) the elections described in paragraphs (b), (c) and (d)
h ereof were called and held under and in strict
conformity with the Constitution and laws of the State
o f Texas and of the United States of America, and the
Board of Directors of the District has heretofore
o fficially declared the results of said elections and
d eclared that the District was legally created and
authorized to issue the bonds described in paragraphs
(c) and (d) above;
(f) the $4,690,000 bonds authorized by this Order are the
first series of bonds issued pursuant to the authority
of the election held May 3 1997, as described in
paragraph (c) above;
(g) the $4,690,000 bonds authorized by this Order should be
issued pursuant to the authority of the election held
on May 3, 1997, as described in paragraph (c) above,
for the acquisition and/or construction of water,
sanitary sewer and storm drainage facilities to serve
land within the District and to pay certain other costs
and expenses relating to the issuance of the bonds;
(h) the District has been authorized to levy taxes in
payment of such bonds, and the taxes to be levied and
collected will be sufficient to pay the principal of
the bonds herein authorized as it matures and the
interest thereon as it accrues and becomes payable; and
(i) the Board of Directors reserves the right to issue the
remaining $33,810,000 unissued bonds which were
authorized at the election described in paragraph (c)
hereof, in one or more series, at a future date or
dates when, in the judgment of the Board of Directors,
such amounts are required for authorized purposes.
(End of Article One)
0006\Bond99\Article l .bnd
ARTICLE TWO
DEFINITIONS AND INTERPRETATIONS
SECTION 2.01: DEFINITIONS. The following definitions
t ogether with the supplemental definitions in Article Eleven,
shall apply with equal force herein (except in Section 8.01
h ereof and in Exhibits "A", "B", and "C" hereto) and in any
amendment or supplement hereto.
Additional Bonds.
The term 'Additional Bonds" shall mean any additional bonds,
including Additional Tax Bonds, revenue bonds, contract revenue
bonds, special proDect revenue bonds, refunding bonds and other
bonds which the Board of Directors expressly reserves the right
t o issue in Article Nine of this Order
Additional Tax Bonds.
The term "Additional Tax Bonds" shall mean all or any
portion of the $33,810,000 unissued bonds authorized at the
election described in paragraph (c) of Section 1 05 of this
O rder, the $38,500,000 unissued bonds authorized at the election
d escribed in paragraph (d) of Section 1 05 of this Order, and
such other bonds, including refunding bonds, payable wholly from
ad valorem taxes, which the District may now or hereafter be
authorized to issue from time to time.
Authorized Investments.
The term "Authorized Investments" shall mean all instruments
which are authorized under the District's policies for investment
of funds of the District adopted by the Board of Directors of the
District from time to time, but in any event, all such
instruments shall be authorized under the laws of the State of
Texas for investment of funds of municipal utility districts.
Board of Directors.
The term "Board of Directors" shall mean the governing body
of the District as now or hereafter constituted.
Bond Counsel.
The term "Bond Counsel" shall mean the law firm of Schwartz,
Page & Harding, L L.P., Houston, Texas.
Bond Fund.
The term "Bond Fund" shall mean the District's debt service
fund created and established pursuant to this Order.
Bonds.
The term "Bond" or "Bonds" shall mean any Bond or Bonds, as
the case may be, of the issue of $4,690,000 Unlimited Tax Bonds,
Series 1999, initially dated as of December 1, 1999, and
authorized, issued and delivered pursuant to this Order
Business Day.
The term "Business Day" or "Business Days" shall mean any
calendar day or days which fall on Monday through Friday, but
shall not include any such day which is designated as an official
state or national holiday or a day on which financial
institutions where the Paying Agent is located are authorized or
required by state or national law or by executive order to close.
Construction Fund.
The term "Construction Fund" shall mean the District's
construction fund created and established pursuant to this Order.
District.
The term "District" is defined in Article One hereof and
shall mean and include any successors and assigns of the District
and where appropriate, shall refer to the Board of Directors of
the District
Fiscal Year.
The term 'Fiscal Year" shall mean the annual period from
August 1 through July 31, or such other period as may hereafter
be established by resolution of the Board of Directors of the
District.
Holder.
The term "Holder" or "Holders" shall mean, when used with
respect to any Bond, the Person or Persons in whose name such
Bond is registered on the Register.
Initial Bonds.
The term "Initial Bond" or "Initial Bonds" shall mean any
one or more of the Bonds authorized, issued and initially
delivered hereunder upon which the manually executed certificate
2-2
of registration of the Comptroller of Public Accounts of the
S tate of Texas, or his duly authorized deputy, substantially in
t he form prescribed in Section 5 03 hereof, has been placed.
Initial Date.
The term "Initial Date" shall mean December 1, 1999.
Initial Purchaser.
The term "Initial Purchaser" shall mean the Person or
P ersons to whom the Bonds are to be sold and delivered, as
provided in Section 13.01 hereof.
Interest Payment Date.
The term "Interest Payment Date' shall mean the date on
which interest on any then outstanding Bond is due and payable,
as provided in Section 3.04 hereof.
Maturity Date.
The term "Maturity Date" shall mean any date on which the
principal of any then outstanding Bond is due and payable, as
provided in Section 3.03 hereof
N et Proceeds.
The term "Net Proceeds" shall mean all proceeds received by
t he District from the sale of the Bonds, except those proceeds
d eposited into the Bond Fund pursuant to the provisions of
S ection 7.04 hereof.
O rder.
The term "Order" shall mean this Order and all amendments
hereof and supplements hereto.
P aying Agent.
The term "Paying Agent" shall mean the agency or agencies
selected and maintained from time to time by the District for the
purpose of making payment on behalf of the District of the
principal of and the interest on the Bonds, as provided in
S ection 12.06 of this Order.
P erson.
The term "Person" shall mean any individual, corporation,
partnership, firm, joint venture, association joint stock
company, trust unincorporated organization or government, or any
agency or political subdivision thereof.
Predecessor Bonds.
The term "Predecessor Bonds" shall mean, with respect to any
particular Bond, every previous Bond evidencing all or a portion
of the same obligation as that evidenced by such particular Bond,
and, for the purposes of this definition, any Bond registered and
delivered pursuant to Section 3.10 hereof shall be deemed to
evidence the same debt as the mutilated, lost, destroyed or
stolen Bond in lieu of which such Bond was delivered.
Record Date.
The term "Record Date" shall mean, with respect to an
Interest Payment Date of March 1, the preceding February 15, and
with respect to an Interest Payment Date of September 1, the
preceding August 15, whether or not such dates are Business Days.
Redemption Date.
The term "Redemption Date" shall mean, when used with
✓ espect to any Bond, the date fixed for redemption of such Bond
pursuant to the terms of this Order.
Register.
The term "Register" shall mean the registry books maintained
on behalf of the District by a Registrar designated by the
District for such purpose in which are maintained the names and
addresses of Holders and the principal amounts of the Bonds
✓ egistered in the name of each Holder.
Registrar.
The term "Registrar" shall mean the trust or banking corpo-
✓ ation or association designated and acting in such capacity from
time to time, as provided in Section 12.05 of this Order.
System.
The term "System' shall mean the waterworks system, sanitary
sewer system, and drainage and storm sewer system, of the
District, including, but not limited to, all works, improvements,
facilities, plants equipment, appliances interest in property
and contract rights needed therefor, and administrative
facilities needed in connection therewith, now owned or hereafter
purchased, constructed or otherwise acquired, and all extensions
and replacements thereof and improvements thereto whensoever
made.
2-4
Water Code.
The term "Water Code" is defined in Article One hereof.
SECTION 2.02: INTERPRETATIONS; TIME OF PERFORMANCE The
t itles and headings of the articles and sections of this Order
have been inserted for convenience of reference only and are not
t o be considered a part hereof and shall not in any way modify or
✓ estrict any of the terms or provisions hereof. This Order and
all the terms and provisions hereof shall be liberally construed
t o effectuate the purposes set forth herein and to sustain the
validity of the Bonds and the validity of the taxes levied in
payment thereof. Unless a time period specified for performance
o f any action under this Order is specified to be a Business Day
o r Business Days such performance time period means the number
o f calendar days for such performance to be accomplished.
(End of Article Two)
0006\B ond99\Article2. bnd
ARTICLE THREE
AUTHORIZATION, DESCRIPTION AND EXECUTION OF BONDS
SECTION 3.01: AMOUNT, NAME, PURPOSE AND AUTHORIZATION. The
Bonds of the District, to be known and designated as "Brazoria
County Municipal Utility District No. 6, of Brazoria County,
Texas, Unlimited Tax Bonds, Series 1999", shall be issued in the
aggregate principal amount of Four Million Six Hundred Ninety
Thousand Dollars ($4,690,000) for the purpose or purposes of
purchasing, constructing, acquiring, owning, operating, repair-
ing, improving or extending a waterworks system, a sanitary sewer
system, and a drainage and storm sewer system for the District,
including but not limited to all additions to such systems and
all works, improvements, facilities, plants, equipment,
appliances, interests in property, and contract rights needed
t herefor and administrative facilities needed in connection
t herewith, all under and in strict conformity with the
Constitution and laws of the State of Texas, including,
particularly, Section 59 of Article XVI of the Constitution of
Texas and the Water Code.
SECTION 3.02: FORM, INITIAL DATE, NUMBERS AND DENOMIN-
ATIONS. The Initial Bonds shall be issued and delivered in fully
✓ egistered form, without interest coupons and shall be dated as
o f the Initial Date. Thereafter, each Bond registered and
d elivered by the Registrar hereunder shall be similarly dated as
o f the Initial Date, but shall include thereon the date of its
authentication by the Registrar. Each Initial Bond submitted for
approval, registration and delivery in accordance with Section
3.07 hereof shall be numbered "IR-", followed by the last two
d igits of the year in which such Initial Bond is scheduled to
mature. Each Bond registered and delivered by the Registrar
t hereafter shall be numbered consecutively, in succession,
beginning with the numeral "1", which shall be preceded by the
prefix "R-", and shall be in denominations of $5,000, or any
integral multiple thereof.
SECTION 3.03: INTEREST RATES AND MATURITY DATES The Bonds
shall be serial Bonds, shall bear interest from the later of the
Initial Date, or the most recent Interest Payment Date to which
interest has been paid or duly provided for, at the rate or rates
set forth in the following schedule, and shall mature and become
payable sub:ect to prior redemption in accordance with the pro-
visions of Article IV hereof, on September 1 in each of the years
and in the principal amounts set forth in the schedule below:
Principal
Amount
$130,000
140,000
150,000
160,000
170,000
180,000
190,000
205,000
220,000
235,000
250,000
265,000
280,000
300,000
320,000
340,000
360,000
385,000
410,000
Year of
Maturity
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Interest
Rate
SECTION 3.04: DATES AND MANNER OF PAYMENT OF INTEREST.
Interest on the Bonds shall be payable semiannually on March 1
and September 1 of each year, commencing on March 1, 2000, until
payment of the principal thereof has been made or duly provided
for. The amount of interest on the Bonds payable on each Interest
P ayment Date, Maturity Date or Redemption Date shall be computed
o n the basis of a 360-day year of twelve 30-day months. Not later
t han ten (10) days before each Interest Payment Date, Maturity
Date or Redemption Date, the Paying Agent shall compute the
amount of interest to be due and payable on such date and shall
send to the District notice of the amount so computed to be due
and payable on such date.
The payments of interest on the Bonds shall be payable, at
t he option of the District, by check mailed by the Paying Agent
t o the Holder, at the address shown on the Register; or by wire
t ransfer to such Holder at the expense of the Holder, or by such
o ther customary banking arrangements as may be acceptable to the
P aying Agent and the Holder, at the risk and expense of such
Holder. The interest so payable on any Interest Payment Date
will be paid to the Person in whose name each Bond (or one or
more Predecessor Bonds evidencing the same obligation) is regis-
t ered at the close of business on the Record Date for such
Interest Payment Date. Each Bond delivered pursuant to the terms
o f this Order upon transfer or in exchange for or in lieu of any
P redecessor Bond shall carry all the rights to interest, both
accrued and unpaid and to accrue which were carried by such
Predecessor Bond, and each such Bond shall bear or accrue
interest as specified herein so that neither gain nor loss in
interest shall result from such transfer, exchange or
substitution.
SECTION 3.05: MEDIUM AND PLACE OF PAYMENT AT MATURITY OR
REDEMPTION. The principal of the Bonds payable at any Maturity
Date or Redemption Date, shall be payable, without exchange or
collection charges, in any coin or currency of the United States
of America which on such dates of payment is legal tender for the
payment of debts due the United States of America, upon the
presentation and surrender of such Bonds, as they become due or
at their earlier Redemption Date, at the designated corporate
trust office of the Paying Agent.
SECTION 3.06: EXECUTION. The Bonds shall be signed on
behalf of the District by the President and Secretary of the
Board of Directors of the District, and the District's seal shall
be placed or impressed thereon. Such signatures may be manually
executed or placed in facsimile on the Bonds, and the District s
seal may be manually Impressed or printed or otherwise mechan-
ically reproduced in facsimile on the Bonds. In case any official
o f the District who shall have signed any of the Bonds, either
manually or by facsimile signature, shall cease to be such
o fficer before the Bonds so signed shall have been authenticated
and delivered by the Registrar, or disposed of by the District,
such Bonds, nevertheless, may be authenticated and delivered or
d isposed of as though the Person who signed such Bonds had not
ceased to be such officer of the District, and any Bond may be
signed on behalf of the District by such Person as, at the actual
t ime of execution of such Bond, shall be a proper officer of the
District, although at the date of such Bond or of the adoption of
this Order, such Person was not such officer. Minor typograph-
ical and other minor errors in the text of any Bond or minor
d efects in the seal or facsimile signature on any Bond shall not
affect the validity or enforceability of such Bond, if same has
been duly authenticated by the Registrar or registered by the
Comptroller of Public Accounts of the State of Texas as required
h erein.
SECTION 3.07: APPROVAL, REGISTRATION AND DELIVERY. The
Initial Bonds shall consist of one Bond for each year of maturity
specified in Section 3.03 hereof, representing the entire
principal amount of the Bonds scheduled to mature in each of such
years of maturity, and shall be made payable to the Initial
Purchaser, or its designee. The President and Secretary of the
Board of Directors of the District and representatives of the
District s Bond Counsel are each hereby authorized and directed
to submit the Initial Bonds and a transcript of the proceedings
relating to the issuance of the Bonds to the Attorney General of
Texas for approval and, following said approval, to submit the
Initial Bonds to the Comptroller of Public Accounts of the State
of Texas for registration. Upon registration of the Initial
Bonds, the Comptroller of Public Accounts (or a deputy designated
in writing to act for the Comptroller) shall manually sign the
Comptroller's registration certificate prescribed herein to be
printed and endorsed on each Initial Bond. After the Initial
Bonds have been registered and signed by the Comptroller, they
shall be registered on the Register in the name of and shall be
d elivered to the Initial Purchaser, but only upon receipt of the
full purchase price therefor.
At any time after delivery of the Initial Bonds, the Initial
Purchaser or any subsequent Holder may, subject to the require-
ments of and in accordance with the procedures prescribed in
S ection 3.09 hereof, surrender any Bonds to the Registrar for
t ransfer or exchange, accompanied by instructions specifying the
name(s) and address(es) of the Person(s) to whom such Bonds are
t o be transferred and the principal amount(s) of the Bond(s) to
be authenticated and delivered in exchange therefor and the
Registrar shall thereupon, within not more than three (3)
Business Days, authenticate and register Bonds conforming to such
instructions and the provisions of this Order.
No Initial Bond shall be entitled to any right or benefit
under this Order, or be valid or obligatory for any purpose,
unless there appears on such Initial Bond a certificate of
registration substantially in the form provided in Section 5.03
hereof, duly executed by the Comptroller of Public Accounts of
the State of Texas, or his duly authorized deputy, by manual
signature; nor shall any Bond authenticated and delivered
subsequent to the Initial Bonds be so entitled or be valid or
obligatory, unless there appears on such Bond a Certificate of
Registrar substantially in the form provided in Section 5.02
h ereof, duly executed by an authorized officer or employee of the
Registrar, by manual signature. Such Certificate of Registrar
upon any Bond authenticated and delivered subsequent to the
Initial Bonds shall be conclusive evidence that such Bond has
been so certified or registered and delivered.
SECTION 3.08: OWNERSHIP OF BONDS. The District, the Paying
Agent, 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 thereof and interest thereon and for all other
purposes whether or not such Bond is overdue, and neither the
District the Paying Agent, nor the Registrar shall be bound by
any notice or knowledge to the contrary. All payments made to
t he Person deemed to be the owner of any Bond in accordance with
t his Section 3.08 shall be valid and effective for all purposes
and shall discharge the liability of the District, the Paying
Agent and the Registrar to the extent of the sums paid.
SECTION 3.09: REGISTRATION, TRANSFER AND EXCHANGE So long
as any Bonds remain outstanding, the Registrar shall keep and
maintain at its designated corporate trust office a Register in
which, subject to such reasonable regulations as it may
prescribe, the Registrar shall provide for the registration,
t ransfer and exchange of Bonds in accordance with the terms of
t his Order.
Each Bond shall be transferable only upon the presentation
and surrender thereof at the office designated by the Registrar,
duly endorsed for transfer or accompanied by an assignment duly
e xecuted by the registered owner or his authorized represent-
ative. Within three (3) Business Days following due presentation
for registration of the transfer of any Bond, the District shall
cause to be executed and the Registrar shall authenticate in the
name of the transferee or transferees one or more exchange Bonds
in a like aggregate principal amount and a like interest rate and
shall deliver or mail same to the transferee or transferees by
United States mail, first class, postage prepaid.
All Bonds shall be exchangeable upon the presentation and
surrender thereof at the office designated by the Registrar for a
Bond or Bonds having the same maturity and interest rate, in any
authorized denomination, and in an aggregate principal amount
e qual to the unpaid principal amount of the Bond or Bonds
presented for exchange. Within three (3) Business Days following
due presentation for exchange of any Bond, the District shall
cause to be executed and the Registrar shall authenticate
✓ egister and deliver or send to the Holder, by United States
mail, first class, postage prepaid, exchange Bonds in accordance
with the provisions of this Section 3.09.
Each Bond transferred or exchanged and duly authenticated
and delivered in accordance with this Section 3.09 shall be
e ntitled to the benefits and security of this Order to the same
extent as the Bond or Bonds in lieu of which such exchange Bond
is delivered. No service charge shall be made for any transfer
o r exchange referred to above, but the District or the Registrar
may require the Holder of any Bond to pay a sum sufficient to pay
any tax or other governmental charge that may be imposed in
connection with the transfer or exchange of such Bond.
The Registrar shall not be required to transfer or exchange
any Bond on any date subsequent to a Record Date and prior to the
next succeeding Interest Payment Date, or during any period
beginning fifteen (15) calendar days prior to, and ending on the
date of the mailing of, notice of redemption of Bonds prior to
maturity, nor shall the Registrar be required to transfer or
exchange any Bond selected for redemption in whole or in part
when such Redemption Date is scheduled to occur within thirty
(30) calendar days.
SECTION 3 10: REPLACEMENT BONDS. Upon the presentation and
surrender to the Registrar of a mutilated Bond, the District
shall cause to be executed, and the Registrar shall authenticate,
✓ egister and deliver in exchange therefor, a replacement Bond of
like tenor and principal amount bearing a number not contemporan-
e ously outstanding. In the event that any Bond is lost,
apparently destroyed or wrongfully taken, the District, pursuant
to the applicable laws of the State of Texas, and in the absence
o f actual notice or knowledge that such Bond has been acquired by
a bona fide purchaser, shall cause to be executed, and the
Registrar shall authenticate, register and deliver, a replacement
Bond of like tenor, interest, and principal amount bearing a
number not contemporaneously outstanding provided that the
Holder thereof shall have:
(a) furnished to the Registrar and the District satisfac-
t ory evidence of the ownership and the circumstances of
t he loss, destruction or theft of such Bond;
(b) furnished such security or indemnity as may be required
by the Registrar, the District and the Paying Agent to
save the District, the Registrar and the Paying Agent
harmless;
(c) paid all expenses and charges in connection therewith,
including, but not limited to, printing costs, legal
fees, fees and expenses of the Registrar, the District
and Paying Agent and any tax or other governmental
charge that may be imposed; and
(d) met any other reasonable requirements of the District,
t he Registrar and the Paying Agent.
If, after the delivery of such replacement Bond, a bona fide
purchaser of the original Bond in lieu of which such replacement
Bond was issued presents for payment such original Bond, the
District, the Registrar and the Paying Agent shall be entitled to
recover upon 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 District, the Registrar and the
Paying Agent in connection therewith
In the event that any such mutilated, lost, apparently
d estroyed or wrongfully taken Bond has become or is about to
become due and payable the Paying Agent, with the concurrence of
t he Registrar, in their discretion, may pay such Bond, in lieu of
issuance of a replacement Bond.
Each replacement Bond delivered in accordance with this
S ection 3.10 shall be entitled to the benefits and security of
t his Order to the same extent as the Bond or Bonds in lieu of
which such replacement Bond is delivered.
SECTION 3.11 CANCELLATION. All Bonds paid or redeemed in
accordance with this Order and all Bonds in lieu of which
e xchange Bonds or replacement Bonds are executed, authenticated,
✓ egistered and delivered in accordance with Section 3.09 or
S ection 3.10 of this Order, shall be cancelled upon the making of
proper records regarding such payment, redemption, exchange or
✓ eplacement and shall be treated in accordance with the document
✓ etention policies of the Paying Agent and the records retention
schedules of the District. The Paying Agent and Registrar shall
periodically furnish the District with certificates of
cancellation of such Bonds, upon written request therefor
(End of Article Three)
0006\Bond99\Article3.bnd
ARTICLE FOUR
REDEMPTION OF BONDS BEFORE MATURITY
SECTION 4.01: REDEMPTION OF BONDS. The District reserves
t he right, at its option, to redeem the Bonds maturing on or
after September 1, 2010, prior to their scheduled maturities, in
whole or from time to time, in part, on September 1, 2009, or on
any Interest Payment Date thereafter, at a price equal to the
principal amount thereof to be redeemed plus accrued interest on
t he Bonds called for redemption to the Redemption Date. The
District shall, at least forty-five (45) calendar days prior to
t he Redemption Date (unless a shorter notice shall be satisfac-
t ory to the Registrar and Paying Agent), notify the Registrar and
t aying Agent of such Redemption Date and of the principal amount
o f the Bonds of each maturity to be redeemed. If less than all
o f the Bonds of the same maturity are to be redeemed, the
particular Bonds to be redeemed in whole or in part from within
e ach such maturity shall be selected by the Registrar from the
Bonds which have not previously been called for redemption, by
method of random selection; provided, however, that in the event
t hat a Bond subject to redemption is in a denomination larger
t han $5,000 a portion of such Bond may be redeemed, but only in
a principal amount equal to $5,000 or an integral multiple
t hereof. The Registrar shall promptly notify the District and
t he Paying Agent, if different than the Registrar in writing, of
t he Bonds selected for redemption and, in the case of any Bond
selected for partial redemption, of the principal amount thereof
t o be redeemed.
For purposes of this Order, unless the context otherwise
✓ equires, all provisions relating to the redemption of Bonds
shall relate, in the case of any Bond redeemed or to be redeemed
only in part, to the portion of the principal amount of such Bond
which has been or is to be redeemed. Upon surrender of any Bond
for redemption in part, the Registrar, in accordance with Section
3.09 of this Order, shall authenticate, register and deliver an
e xchange Bond or Bonds of like interest rate and in aggregate
principal amount equal to the unredeemed portion of the Bond so
surrendered.
SECTION 4.02: NOTICE OF REDEMPTION. Notice of each exercise
o f the reserved right of redemption shall be given by the
District, or at the District's request, by the Registrar, at
least thirty (30) calendar days prior to the Redemption Date by
sending such notice by first class United States mail, postage
prepaid, to the Holder of each Bond to be redeemed in whole or in
part at the address shown on the Register on the date which is
forty-five (45) calendar days prior to the Redemption Date. Such
notice shall state the Redemption Date, the redemption price, the
4-1
principal amounts of the Bonds to be redeemed and, if less than
all of the then outstanding Bonds are to be redeemed, the identi-
fication (and, in the case of partial redemptions within a
maturity, the respective principal amounts) of the Bonds to be
✓ edeemed, the amount of accrued interest payable on the
Redemption Date and the place at which the Bonds are to be
surrendered for payment. Any notice mailed as provided in this
S ection 4.02 shall be conclusively presumed to have been duly
g iven, whether or not the Holder actually receives such notice.
Except as otherwise provided in Section 11.03 of this Order, no
✓ ther notice of the reserved right of redemption shall be given
unless otherwise required by law. By the Redemption Date, due
provision shall be made with the Paying Agent for the payment of
t he principal of the Bonds to be redeemed, plus accrued interest
t hereon to the Redemption Date When Bonds have been called for
✓ edemption, in whole or in part, as provided above, and due
provision has been made to redeem same, such Bonds, or portions
t hereof, shall no longer be regarded as outstanding, except for
t he purpose of receiving payment from the funds provided for
✓ edemption, and the right of the Holders to collect interest
which would otherwise accrue after the Redemption Date upon the
principal of such Bonds or the portions thereof so called for
✓ edemption shall be terminated.
(End of Article Four)
0006\B ond99\Article4. Und
ARTICLE FIVE
FORM OF BONDS AND CERTIFICATES
SECTION 5.01: FORM OF BONDS. The Bonds authorized by this
O rder shall be in substantially the forms specified in Exhibits
"A" and 'B" attached hereto and made a part hereof for all
purposes, with such omissions, insertions and variations as may
be necessary or desirable and consistent with the terms of this
O rder.
SECTION 5.02: CERTIFICATE OF REGISTRAR. The following form
o f Certificate of Registrar shall be printed on the face of each
o f the Bonds authenticated, registered and delivered subsequent
t o the Initial Bonds:
CERTIFICATE OF REGISTRAR
This is to certify that this bond is one of the bonds issued
under the provisions of the within -mentioned Bond Order, and it
is hereby further certified that this bond has been authorized
and delivered in conversion and exchange for, or in replacement
o f, a bond, bonds or portions thereof (or one or more prior
conversion, exchange or replacement bonds) originally issued by
Brazoria County Municipal Utility District No. 6, of Brazoria
County Texas approved by the Attorney General of Texas, and
initially registered by the Comptroller of Public Accounts of the
S tate of Texas.
, Registrar
Dated: By:
Authorized Signatory
SECTION 5.03: REGISTRATION OF BONDS BY STATE COMPTROLLER
AND CERTIFICATE The Initial Bonds shall be registered by the
Comptroller of Public Accounts of the State of Texas, as provided
by law. In lieu of the Certificate of Registrar specified in
S ection 5.02 hereof, the registration certificate of the
Comptroller of Public Accounts of the State of Texas shall be
printed or typed on each of the Initial Bonds and shall be in
substantially the following form:
OFFICE OF THE COMPTROLLER
REGISTER NO.
THE STATE OF TEXAS
I HEREBY CERTIFY that there is on file and of record in my
office a certificate of the Attorney General of the State of
Texas to the effect that this bond has been examined by him as
required by law, that he finds that it has been issued in
conformity with the Constitution and laws of the State of Texas,
and it is a valid and binding obligation of Brazoria County
Municipal Utility District No. 6, of Brazoria County, Texas, and
said bond has this day been registered by me.
WITNESS MY HAND AND SEAL OF OFFICE at Austin, Texas,
•
Comptroller of Public Accounts
of the State of Texas
SECTION 5.04: FORM OF ASSIGNMENT. The following form of
Assignment shall be printed on the back of each of the Bonds:
ASSIGNMENT
For value received, the undersigned hereby sells, assigns
and transfers unto (print or typewrite name address and zip code
of transferee) :
(Social Security or other identifying number): the
within Bond and does hereby irrevocably constitute and appoint
as attorney to transfer said
Bond on the books kept for registration thereof, with full power
of substitution in the premises.
Dated:
The signature of the Registered
Owner appearing on this Assign-
ment is hereby verified as true
and genuine and is guaranteed
by:
(Bank, Trust Company, or
Brokerage Firm)
By:
(Authorized Representative)
Registered Owner
NOTICE• The signature on this
Assignment must correspond in
every particular with the name
of the Registered Owner as it
appears on the face of the
within Bond.
SECTION 5.05: CUSIP REGISTRATION. The officers and repre-
sentatives of the District may secure the printing of identi-
fication numbers on the Bonds through the CUSIP Service Bureau
Division of Standard & Poors Corporation, New York, New York.
SECTION 5.06: LEGAL OPINION. The approving opinion of the
District s Bond Counsel may be printed on the Bonds over the
certification of the Secretary of the Board of Directors, which
may be executed in facsimile.
(End of Article Five)
0006\Bond99\Article5.bnd
ARTICLE SIX
SECURITY FOR THE BONDS
SECTION 6.01: SECURITY FOR THE BONDS. The Bonds are se-
cured by and payable from the levy of a continuing, direct,
annual ad valorem tax, without legal limitation as to rate or
amount, upon all taxable property within the District.
SECTION 6.02: LEVY OF TAX. To pay the interest on the
Bonds, and to create a sinking fund for the payment of the
principal thereof when due, and to pay the expenses of assessing
and collecting such taxes and making payments in respect of the
Bonds, there is hereby levied, and there shall be assessed and
collected in due time, a continuing, direct, annual ad valorem
t ax without limit as to rate or amount, on all taxable property
in the District for each year while any of the Bonds are
outstanding. All of the proceeds of such collections, except
costs incurred in that connection, shall be paid into the Bond
Fund [Tax Bond Account] and the aforementioned tax and such
payments into the Bond Fund [Tax Bond Account] shall continue
until the Bonds and the interest thereon, together with all
expenses incurred in making payments in respect of the Bonds and
all amounts due to the United States of America pursuant to
S ection 8.01(h) hereof have been fully paid and discharged and
such proceeds shall be used for such purposes and no other.
While said Bonds, or any of them, are outstanding and unpaid an
ad valorem tax, each year at a rate from year to year as will be
ample and sufficient to provide funds to pay the current interest
on said Bonds and to provide the necessary sinking fund to pay
t he principal and accrued interest on the Bonds when due with
full allowance being made for delinquencies and costs of
collection, shall be levied, assessed and collected, as follows:
(a) After receipt of the certified roll of taxable property
in each year, and at such time as required by then
applicable law, the Board of Directors shall consider
t he taxable property in the District and determine the
actual rate per $100 valuation of taxable property
which is to be levied in that year and shall levy such
t ax against all taxable property in the District.
(b) In determining the actual rate to be levied in each
year, the Board of Directors shall consider, among
other matters:
(1) the amount which should be levied for the payment
of the principal of or the interest, payment
expenses and redemption price on each series of
bonds or notes of the District payable in whole or
in part from taxes, including but not limited to,
6-1
t he Bonds, [the Outstanding Bonds] and any
Additional Bonds; and
(2) the percentage of anticipated tax collections and
t he costs of assessing and collecting such taxes.
(c) In determining the amount of taxes which should be
levied each year, the Board of Directors may also
consider whether proceeds from the sale of bonds of the
District have been capitalized or placed in escrow to
pay interest during construction and whether the Board
o f Directors reasonably expects to have investment
e arnings from the Bond Fund [Tax Bond Account] or
excess arbitrage profits payable to the United States
o f America, or revenues or receipts available from
o ther sources which are legally available to pay the
principal of or the interest, payment expenses or
✓ edemption price on the Bonds, [the Outstanding Bonds]
o r any Additional Bonds or notes payable in whole or in
part from taxes.
In addition to the tax levied pursuant to this Section 6.02, the
District may also levy from time to time taxes for maintenance
and operation purposes, for contract obligations payable from
taxes, and for any other purpose or purposes authorized by law.
SECTION 6.03: CONSOLIDATION OF DISTRICT. The laws of the
State of Texas permit the District to be consolidated with one or
more conservation and reclamation districts. In the event the
District is consolidated with another district or districts, the
District reserves the right to:
(a) Consolidate the System with a similar system of
one or more districts with which the District is
consolidating and operate and maintain the systems
as one consolidated system (herein for purposes of
t his section the "Consolidated System").
(b) Apply the net revenues from the operation of the
Consolidated System to the payment of principal,
interest, redemption price and payment expenses on
t he revenue bonds or the combination tax and
✓ evenue bonds (herein for purposes of this section
t he "revenue bonds") of the District and of the
t istrict or districts with which the District is
consolidating (herein collectively the "Consoli-
dating Districts") without preference to any
series of bonds (except subordinate lien revenue
bonds which shall continue to be subordinate to
t he first lien revenue bonds of the Consolidating
Districts).
6-2
(c) Pledge the net revenues of the Consolidated System
to the payment of principal interest, redemption
price and payment expenses on revenue bonds which
may be issued by the Consolidating Districts on a
parity with the outstanding first lien revenue
bonds on the Consolidating Districts.
(End of Article Six)
0006\Bond99\Article6.bnd
ARTICLE SEVEN
APPLICATION OF BOND PROCEEDS; FLOW OF FUNDS AND INVESTMENTS
S ECTION 7.01: BOND PROCEEDS. Proceeds from the sale of the
Bonds will be disbursed in accordance with this Article Seven.
S ECTION 7.02: CREATION OF FUNDS AND ACCOUNTS. The District
hereby creates and establishes a Bond Fund and a Construction
Fund. Each fund shall be kept separate and apart from all other
funds of the District. The Bond Fund, to the extent permitted by
law, shall constitute a trust fund for the benefit of the Holders
o f the Bonds and any Additional Bonds payable in whole or in
part from taxes, and shall be applied only to pay interest and
principal on the Bonds and any Additional Bonds payable in whole
o r in part from taxes and the fees and expenses of any Paying
Agent or Registrar in respect of same, and to defray the
e xpenses, if any, of assessing and collecting taxes levied for
payment of the interest on and principal of the Bonds and any
Additional Bonds payable in whole or in part from taxes, to pay
any tax anticipation notes issued together with interest thereon,
as such tax anticipation notes shall become due, and to pay to
the United States of America any excess arbitrage profits in
✓ espect of the Bonds and any Additional Bonds payable in whole or
in part from taxes which may hereafter come due.
SECTION 7.03: SECURITY OF ACCOUNTS. Any cash balance in
any fund of the District, to the extent not insured by the Bank
Insurance Fund managed and maintained by the Federal Deposit
Insurance Corporation, or a successor insurance fund, shall be
continuously secured by a valid pledge to the District of
securities eligible under the laws of Texas to secure the funds
o f districts such as the District, having an aggregate market
value, exclusive of accrued interest, at all times at least equal
to the uninsured cash balance in the fund to which such
securities are pledged or such higher amount as required by the
District's policies for investment of funds of the District.
SECTION 7.04: DEPOSITS TO AND WITHDRAWALS FROM BOND FUND.
The District shall deposit or cause to be deposited into the Bond
Fund the aggregate of the following at the times specified:
(a) As soon as practicable after the Initial Bonds are sold
and delivered, moneys received from the Initial
Purchaser representing accrued interest on the Bonds
from the Initial Date to the date of their delivery;
and
(b) As soon as practicable after the Initial Bonds are sold
and delivered, out of the proceeds of the sale of the
Bonds, a sum equal to the initial twenty-four (24)
months of interest on the Bonds; and
(c) As collected, the proceeds from collection of the ad
valorem tax levied pursuant to Section 6.02 hereof,
less the costs of collection thereof.
Not later than five (5) calendar days prior to any Maturity Date,
Redemption Date and/or Interest Payment Date on the Bonds the
Board of Directors shall cause moneys to be deposited into the
Bond Fund in an amount not less than that which is sufficient to
pay the principal of the Bonds which matures and becomes payable
on such date, the interest which accrues and becomes payable on
such date, and the fees and expenses of the Paying Agent and the
Registrar for handling and making such payments on the Bonds on
such date, and not later than two (2) Business Days prior to such
payment dates shall cause such amounts to be wire transferred to
t he Paying Agent.
SECTION 7.05: CONSTRUCTION FUND The District shall
deposit or cause to be deposited into the Construction Fund the
Net Proceeds of the Bonds provided however, that pursuant to the
applicable Rules of the Texas Natural Resource Conservation
Commission and the requirements of the order of said Commission
dated , 1999, approving the issuance of the Bonds
t he sum of $( ) shall be deposited and held
in escrow in or for the account of the Construction Fund. Moneys
on deposit in the Construction Fund shall be used solely for the
payment of the expenses incident to the issuance of the Bonds,
including financial advisory, legal and engineering fees and
expenses, administration, organization and printing expenses of
t he District, and the costs of purchasing, constructing, acquir-
ing, owning, operating, repairing, improving or extending the
t ystem.
SECTION 7.06: SURPLUS CONSTRUCTION FUNDS. After completion
o f the facilities for which the Bonds are issued and the payment
o f all lawful obligations, at the option of the Board and, if
✓ equired, with the consent of any regulatory authority having
jurisdiction, the funds remaining in the Construction Fund,
t ogether with investment earnings thereon, may be used to provide
additional facilities which will become part of the System and/or
for any other legally authorized purpose if such use, in the
opinion of Bond Counsel, does not adversely affect the status of
t he exemption of interest on the Bonds from federal income taxes.
Any moneys remaining in the Construction Fund after completion of
t he entire System shall be deposited into the Bond Fund.
SECTION 7.07: INVESTMENTS; EARNINGS. Moneys deposited into
t he Bond Fund, the Construction Fund, and any other fund or funds
which the District may lawfully create may be invested or
7-2
reinvested from time to time, but only in Authorized Investments.
Except to the extent otherwise required to maintain compliance
with the covenants set forth in Section 8.01 hereof all
investments and any profits realized from or interest accruing on
such investments shall belong to the fund from which the moneys
for such investment were taken; provided, however that in the
discretion of the Board of Directors, and if required, with the
consent of any regulatory authority having jurisdiction, the
profits realized from and interest accruing on investments made
from any fund may be transferred to the Bond Fund. If any moneys
are so invested, the District shall have the right to have sold
in the open market a sufficient amount of such investments to
meet its obligations in the event any fund does not have
sufficient uninvested moneys on hand to meet the obligations
payable out of such fund. After such sale, the moneys resulting
therefrom shall belong to the fund from which such investments
were initially taken. The District shall not be responsible to
the Holders for any loss arising out of the sale of any
investments.
(End of Article Seven)
0006\Bond99\Article7.bnd
ARTICLE EIGHT
TAX EXEMPTION
SECTION 8.01: TAX EXEMPTION. For purposes of this Section
8.01, the term "Net Proceeds' means the proceeds derived from the
sale of the Bonds, plus interest earnings thereon, less any
amounts deposited in a reasonably required reserve or replacement
fund; the term "Person" includes any individual, corporation,
partnership unincorporated association or any other entity
capable of carrying on a trade or business; and the term "trade
or business' means, with respect to any natural person, any
activity regularly carried on for profit and with respect to
P ersons other than natural persons, means any activity other than
an activity carried on by a governmental unit.
The District covenants that it shall make such use of the
N et Proceeds of the Bonds, regulate investments thereof and take
such other and further actions as may be required by Sections 103
and 141-150 of the Internal Revenue Code of 1986 (the "Code"),
and all applicable temporary, proposed and final regulations and
procedures promulgated thereunder or promulgated under the
Internal Revenue Code of 1954, to the extent applicable to the
Code (the "Regulations"), necessary to assure that interest on
t he Bonds is excludable from gross income for federal income tax
purposes. Without limiting the generality of the foregoing, the
District hereby covenants as follows:
(a) The District has not permitted and will not permit
more than ten percent (10%) of the Net Proceeds of the Bonds
t o be used in the trade or business of any Person (other
t han use as a member of the general public) other than a
g overnmental unit ("private -use proceeds")
(b) The District has not permitted and will not permit
more than five percent (5%) of the Net Proceeds of the Bonds
t o be used in the trade or business of any Person, other
t han a governmental unit, if such use is unrelated to the
g overnmental purpose of the Bonds; and further the amount
of private -use proceeds of the Bonds in excess of five
percent (5%) of the Net Proceeds of the Bonds ("excess
private -use proceeds") will not exceed the proceeds of the
Bonds expended for the governmental purpose of the Bonds to
which such excess private -use proceeds relate;
(c) The principal of and interest on the Bonds will be
paid from ad valorem tax collections, together with
investment profits and interest earnings thereon,
(d) The District has not permitted and will not permit
an amount exceeding the lesser of (i) $5,000 000 or (ii)
five percent (5%) of the Net Proceeds of the Bonds to be
used directly or indirectly to finance loans to Persons
o ther than governmental units;
(e) The District will not use the proceeds of the
Bonds in a manner that would cause the Bonds or any portion
t hereof to be an 'arbitrage bond" within the meaning of
S ection 148 of the Code or otherwise in any manner which
would cause the Bonds to violate the provisions of Section
149(d) of the Code. The District will monitor the yield on
t he investment of the proceeds of the Bonds and moneys
pledged to the payment of the Bonds, other than amounts not
subject to yield restriction because of their deposit in a
✓ easonably required reserve or replacement fund or a bona
fide debt service fund, and will restrict the yield on such
investments to the extent required by the Code or the
Regulations. Without limiting the generality of the
foregoing, the District will take appropriate steps to
✓ estrict the yield on (i) all Net Proceeds of the Bonds on
h and on a date that is three (3) years from the date of
d elivery of the Bonds and on all amounts within the Bond
Fund not disbursed within thirteen (13) months of the date
o f deposit therein (using a last -in, first out accounting
conversion) and (ii) all investment earnings on hand on a
date that is three (3) years from the date of delivery of
t he Bonds or one (1) year from the date such investment
proceeds are received, whichever is later, to a yield which
is not materially higher than the yield on the Bonds (in
both cases calculated in accordance with the Code and the
Regulations);
(f) The District will not cause the Bonds to be
t reated as "federally guaranteed" obligations within the
meaning of Section 149(b) of the Code (as same may be
modified in any applicable rules, rulings, policies,
procedures, regulations or other official statements
promulgated or proposed by the Department of the Treasury or
t he Internal Revenue Service with respect to 'federally
guaranteed" obligations described in Section 149(b) of the
Code) ;
(g) To the extent, if applicable, required by the Code
o r Regulations, the District will take all necessary steps
t o comply with the requirement that "excess arbitrage
profits" earned on the investment of the gross proceeds of
t he Bonds, if any, be rebated to the United States of
America, and specifically, the District will (i) maintain
✓ ecords regarding the investment of the gross proceeds of
t he Bonds as may be required to calculate such "excess
8-2
arbitrage profits" separately from records of amounts on
d eposit in the funds and accounts of the District which are
allocable to other bond issues of the District or moneys
which do not represent gross proceeds of any bonds of the
District, (ii) calculate, not less often than required by
applicable federal law and the Regulations, the amount of
"excess arbitrage profits", if any, earned from the
investment of the gross proceeds of the Bonds and (iii) pay,
not less often than required by applicable federal law and
the Regulations, all amounts required to be rebated to the
United States of America; and the District will not
indirectly pay any amount otherwise payable to the United
S tates of America pursuant to the foregoing requirements to
any Person other than the United States of America by
entering into any investment arrangement with respect to the
g ross proceeds of the Bonds that might result in a smaller
profit or a larger loss than would have resulted if the
arrangement had been at arm's length and had the yield on
t he issue not been relevant to either party• and
(h) The District will timely file a statement with the
United States of America setting forth the information
required pursuant to Section 149(e) of the Code.
For purposes of the foregoing (a) and (b), the District
understands that the term "Net Proceeds" includes "disposition
proceeds" as defined in the Regulations and in the case of
refunding bonds, transferred proceeds (if any) and proceeds of
t he refunded bonds expended prior to the date of issuance of the
Bonds. It is the understanding of the District that the covenants
contained herein are intended to assure compliance with the Code
and any regulations or rulings promulgated by the United States
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
District will not be required to comply with any covenant
contained herein to the extent that such failure to comply, in
t he 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,
t he District agrees to comply with the additional requirements to
t he extent necessary, in the opinion of nationally -recognized
bond counsel, to preserve the exemption from federal income
t axation of interest on the Bonds under Section 103 of the Code.
In furtherance of such intention, the District hereby authorizes
and directs the President or Vice President of the Board to
execute any documents, certificates or reports required by the
Code and to make such elections, on behalf of the District, which
may be permitted by the Code as are consistent with the purpose
8-3
for the issuance of the Bonds. Furthermore, all officers,
employees and agents of the District are authorized and directed
t o provide certifications of facts, estimates and circumstances
which are material to the reasonable expectations of the District
as of the date the Initial Bonds are delivered and paid for and
any such certifications may be relied upon by Bond Counsel, by
t he Holders of the Bonds, and by any person interested in the
exclusion of interest on the Bonds from gross income for federal
income tax purposes. Moreover, the District covenants that it
shall make such use of the proceeds of the Bonds, regulate
investments of proceeds thereof, and take such other and further
actions as may be required to maintain the exclusion of interest
o n the Bonds from gross income for federal income tax purposes.
SECTION 8.02. QUALIFIED TAX-EXEMPT OBLIGATIONS. The
District hereby designates the Bonds as "qualified tax-exempt
o bligations' for purposes of Section 265(b) of the Code and
covenants that it shall take all actions necessary to satisfy
with respect to the Bonds the requirements of Section 265(b)(3)
o f the Code In particular the District represents that:
(a) the aggregate amount of tax-exempt obligations
issued by the District during calendar year 1999, including
the Bonds, which have been designated as "qualified tax-
exempt obligations" under Section 265(b)(3) of the Code,
does not exceed $10,000,000; and
(b) the reasonably anticipated amount of tax-exempt
obligations which will be issued by the District during the
calendar year 1999, including the Bonds, will not exceed
$10,000,000.
For purposes of this Section 8.02, the term "tax-exempt obliga-
t ion' does not include "specified private activity bonds" within
t he meaning of Section 141 of the Code, other than 'qualified
501 (c) (3) bonds" within the meaning of Section 145 of the Code.
In addition, for purposes of this Section 8.02, the District
includes all governmental units of which the District is a
"subordinate entity" and governmental units which are 'subord-
inate entities" of the District, within the meaning of Section
265 (b) (3) (E) of the Code
SECTION 8.03: ALLOCATION OF, AND LIMITATION ON, EXPENDI-
TURES. The District covenants to account for the expenditure of
t he proceeds of the sale of the Bonds and investment earnings to
be used for the purposes for which the Bonds are issued on its
books and records by allocating proceeds to expenditures within
18 months of the later of the date that (1) the expenditure is
made, or (2) the facilities to be constructed and/or purchased
with the proceeds of the Bonds are completed. The foregoing
n otwithstanding, the District shall not expend sale proceeds or
8-4
investment earnings thereon more than 60 days after the earlier
o f (1) the fifth anniversary of the delivery of the Bonds, or (2)
t he date the Bonds are retired. For purposes of determining
compliance with this covenant the District and its officers,
agents and representatives may rely upon an opinion of nationally
✓ ecognized bond counsel or tax counsel to the effect that the
proposed actions or omissions of the District will not adversely
affect the excludability for federal income tax purposes from
t ross income of the interest.
SECTION 8.04: DISPOSITION OF FACILITIES. The District
covenants that the property constituting the facilities to be
constructed and/or purchased with the proceeds of the Bonds will
n ot be sold or otherwise disposed in a transaction resulting in
t he receipt by the District of cash or other compensation unless
t he District obtains an opinion of nationally recognized bond
counsel or tax counsel to the effect that the proposed actions of
t he District will not adversely affect the excludability for
federal income tax purposes from gross income of the interest.
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.
(End of Article Eight)
0006\Bond99\Article8.bnd
ARTICLE NINE
ADDITIONAL BONDS AND REFUNDING BONDS
SECTION 9.01: ADDITIONAL BONDS. The District expressly
✓ eserves the right to issue, in one or more installments,
Additional Bonds for authorized purposes, including, without
limitation:
(a) the remaining unissued bonds which were authorized at
t he election described in Section 1.05 (c) of this
O rder; and
(b) such other bonds as the District may hereafter be
authorized to issue from time to time.
SECTION 9.02: REFUNDING BONDS. The District further
✓ eserves the right to issue refunding bonds including, without
limitation, the refunding bonds which were authorized at the
e lection described in Section 1.05 (d) of this Order in any
manner permitted by law to refund the Bonds and any Additional
Bonds, at or prior to their respective Maturity Dates or on any
Redemption Dates.
(End of Article Nine)
0006\Bond99\Article9.Und
ARTICLE TEN
DEFAULT PROVISIONS
SECTION 10.01: REMEDIES IN EVENT OF DEFAULT In addition to
any other rights and remedies provided by the laws of the State
o f Texas, the District covenants and agrees that in the event of
t efault in the payment of the principal of or interest on any of
t he Bonds when due, or, in the event the District fails to make
t he payments required to be made into the Bond Fund, or defaults
in the observance or performance of any other of the covenants,
conditions or obligations set forth in this Order, the Holders
shall be entitled to seek a writ of mandamus issued by a court of
competent jurisdiction compelling and requiring the District and
t he officials thereof to observe and perform the covenants,
obligations or conditions prescribed in this Order Any delay or
omission in the exercise of any right or power accruing upon any
default shall not impair any such right or power or be construed
t o be a waiver of any such default or acquiescence therein, and
every such right and power may be exercised from time to time and
as often as may be deemed expedient.
SECTION 10.02: ORDER IS CONTRACT. In consideration of the
purchase and acceptance of the Bonds by the Holders, the
provisions of this Order shall be deemed to be and shall consti-
t ute a contract between the District and such Holders, and the
covenants and agreements herein set forth to be performed on
behalf of the District shall be for the equal benefit, protection
and security of each of such Holders Each of the Bonds,
✓ egardless of the time or times of their issue, authentication,
✓ egistration, delivery or maturity, shall be of equal rank,
without preference, priority or distinction of any Bond over any
o ther, except as expressly provided herein.
(End of Article Ten)
0006\Bond99\Artic110.bnd
ARTICLE ELEVEN
CONTINUING DISCLOSURE
SECTION 11.01: DEFINITIONS. As used in this Article, the
following terms have the meanings ascribed to them below:
The term "MSRB" means the Municipal Securities Rulemaking
Board
The term "NRMSIR" means each person whom the SEC or its
staff has determined from time to time to be a nationally
recognized municipal securities information repository, within
t he meaning of the Rule.
The term "obligated person" has the meaning assigned to such
t erm in the Rule.
The term "Offering" has the meaning assigned to such term in
t he Rule.
The term "Rule" means SEC Rule 15c2-12, as amended from time
t o time.
The term "SEC" means the United States Securities and
Exchange Commission.
The term "SID" means any person designated by the State of
Texas or an authorized department, officer or agency thereof as
and determined by the SEC or its staff from time to time to be, a
state information depository, within the meaning of the Rule.
SECTION 11.02: ANNUAL REPORTS. The Bonds qualify for the
Rule 15c2-12(d)(2) exemption from Rule 15c2-12(b)(5) regarding
t he District's continuing disclosure obligations because the
District does not have more than $10,000,000 in aggregate amount
of outstanding bonds, including the Bonds, and no person is
committed by contract or other arrangement with respect to
payment of the Bonds. As required by the exemption, the District
shall provide within six (6) months after the end of each Fiscal
Year ending in or after 2000, to the SID, financial information
and operating data which is customarily prepared by the District
and is publicly available being the information and data
t escribed in Exhibit "C" attached hereto.
If the District changes its Fiscal Year, the District will
notify any SID of the change (and of the date of the new Fiscal
Year end) prior to the next date by which the District otherwise
would be required to provide financial information and operating
data pursuant to this Section 11.02. The District shall notify
any SID and either each NRMSIR or the MSRB in a timely manner,
o f any failure of the District to provide financial information
o r operating data in accordance with this Section 11.02 by the
time required herein.
SECTION 11.03: MATERIAL EVENT NOTICES The District shall
notify any SID and either each NRMSIR or MSRB, in a timely
manner, of any of the following events with respect to the Bonds,
if such event is material within the meaning of the applicable
provisions of the federal securities laws:
(a) Principal and interest payment delinquencies;
(b) Non-payment related defaults;
(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 or events affecting the tax-exempt
status of the Bonds;
(g) Modifications to the rights of the Holders of the
Bonds;
(h) Calls for redemption of the Bonds;
(i) Defeasances of the Bonds;
(j) Release, substitution or sale of property securing
repayment of the Bonds; or
(k) Rating changes.
SECTION 11.04: LIMITATIONS, DISCLAIMERS AND AMENDMENTS.
(a) The District shall be obligated to observe and perform
t he covenants specified in this Article for so long as, but only
for so long as, the District remains an "obligated person' with
✓ espect to the Bonds, within the meaning of the Rule, except that
t he District in any event will give notice of any call for
✓ edemption of the Bonds or defeasance of the Bonds, in whole or
in substantial part, made in accordance with this Order or
applicable law that causes such Bonds to no longer be
o utstanding.
(b) The provisions of this Article are for the sole benefit
o f the Holders and beneficial owners of the Bonds, and nothing
11-2
herein, expressed or implied, shall be deemed to confer any
benefit or any legal or equitable right, remedy or claim
hereunder upon any other person. The District undertakes to
provide only the financial information, operating data financial
statements and notices which it has expressly agreed to provide
pursuant to this Article and does not hereby undertake to provide
any other information that may be relevant or material to a
complete presentation of the District's financial results,
conditions or prospects of the District nor does the District
undertake to update any information provided in accordance with
t his Article or otherwise, except as expressly provided herein.
The District does not make any representation or warranty
concerning such information or its usefulness to a decision to
invest in or to sell Bonds at any future date.
(c) Under no circumstances shall the District be liable to
t he Holder or beneficial owners of any Bond or any other person,
in contract or in tort, for damages resulting, in whole or in
part, from any breach by the District, whether negligent or
without fault on its part, of any covenant specified in this
Article, but every right and remedy of any such person, in
contract or in tort, for or on account of any such breach, shall
be limited to an action for mandamus or specific performance.
(d) No default by the District in observing or performing
its obligations under this Article shall constitute a breach of
o r default under this Order for purposes of any other provision
o f this Order.
(e) Nothing in this Article is intended or shall act to
d isclaim, waive or otherwise limit the duties of the District
under applicable federal and state securities laws
(f) Except as provided hereinafter, the provisions of this
Article may be amended by the District from time to time, in its
d iscretion, to adapt to changed circumstances that arise from a
change in law, the identity, nature, status or type of operations
o f the District or other circumstances, but only if (i) the
provisions of this Article, as so amended, would have permitted
an underwriter to purchase or sell the Bonds in a primary
o ffering of the Bonds in compliance with the Rule, taking into
account any amendments or interpretations of the Rule to the date
o f such amendment, as well as such changed circumstances, and
(ii) either (A) the Holders of a majority in aggregate principal
amount (or any greater amount required by any other provision of
t his Order that authorizes such an amendment) of the outstanding
Bonds consent to such amendment, or (B) a person that is
unaffiliated with the District (such as nationally recognized
bond counsel) determines that such amendment will not materially
impair the interests of the Holders of the Bonds Notwith-
standing the foregoing, the District may also repeal or amend the
11-3
provisions of this Article if the SEC amends or repeals the
applicable provisions of the Rule or if any court of final
jurisdiction enters judgment that such provisions of the Rule are
invalid, but, in either case, only if and to the extent that any
such amendment or repeal by the District would not prevent an
underwriter from lawfully purchasing or selling the Bonds in the
primary offering of the Bonds. If this Article is so amended,
the District shall include with any amended financial information
or operating data next provided in accordance with this Article
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.
(End of Article Eleven)
0006\Bond99\Artic(' 1.bnd
ARTICLE TWELVE
MISCELLANEOUS PROVISIONS
S ECTION 12.01: PAYMENT OF BONDS AND PERFORMANCE OF OBLIGA-
TIONS. The District covenants to pay promptly the principal of
and the interest on the Bonds as the same become due and payable,
whether at maturity or by prior redemption, in accordance with
t he terms of the Bonds and this Order and to keep and perform
faithfully all of its covenants, undertakings and agreements
contained in this Order, the Initial Bonds or in any Bond
e xecuted, authenticated, registered and delivered hereunder.
SECTION 12.02: DISTRICT'S SUCCESSORS AND ASSIGNS. Whenever
in this Order the District is named and referred to, such naming
o r reference shall be deemed to include the District's successors
and assigns, and all covenants and agreements in this Order by or
on behalf of the District, except as otherwise provided herein,
shall bind and inure to the benefit of the District's successors
and assigns, whether or not so expressed.
SECTION 12.03: NO RECOURSE AGAINST DISTRICT OFFICERS. No
✓ ecourse shall be had for the payment of the principal of or
interest on the Bonds or for any claim based thereon or on this
O rder against any officer of the District or any Person executing
the Bonds.
S ECTION 12.04: PAYING AGENT MAY OWN BONDS. The Paying
Agent, in its individual or any other capacity, may become the
owner or pledgee of the Bonds with the same rights it would have
if it were not Paying Agent.
S ECTION 12.05: REGISTRAR. The initial Registrar in respect
o f the Bonds shall be Chase Bank of Texas, National Association.
The District will maintain at least one Registrar in the State of
Texas, where the Bonds may be surrendered for registration of
t ransfer and/or for exchange or replacement for other Bonds, and
for the purpose of maintaining the Register on behalf of the Dis-
t rict. The Registrar shall at all times be a duly qualified and
competent trust or banking corporation or association organized
and doing business under the laws of the United States of
America, or of any State thereof, with a combined capital and
surplus of at least $25,000,000, which is sub:ect to supervision
o f or examination by federal or State banking authorities, and
which is a transfer agent duly registered with the United States
S ecurities and Exchange Commission The District, by order,
✓ esolution or other appropriate action reserves the right and
authority to change any Registrar or to appoint additional Regis-
t rars, and upon any such change or appointment, the District
covenants and agrees to promptly cause written notice thereof,
12-1
specifying the name and address of such changed or additional
Registrar, to be sent to each Holder of the Bonds by United
S tates mail, first class postage prepaid.
S ECTION 12.06: PAYING AGENT. The initial Paying Agent in
✓ espect of the Bonds shall be Chase Bank of Texas, National
Association. To the extent practicable, the District will
maintain in the City of Houston, Texas at least one (1) duly
qualified and competent trust or banking corporation or
association organized and doing business under the laws of the
United States of America, or of any State thereof, where the
Bonds may be presented or surrendered for payment of principal.
The District, by order, resolution or other appropriate action,
✓ eserves the right and authority to change any Paying Agent or to
appoint additional Paying Agents, and upon any such change or
appointment, the District covenants and agrees to promptly cause
written notice thereof, specifying the name and address of such
changed or additional Paying Agent, to be sent to each Holder of
t he Bonds by United States mail, first class, postage prepaid.
S ECTION 12.07: DISCHARGE BY DEPOSIT. The District may
d ischarge its obligation to the Holders to pay the principal of
and the interest on the Bonds and may defease the Bonds in
accordance with the provisions of then applicable law, including,
without limitation, V.T.C.A. Government Code §1207.001 et seq.,
as amended.
S ECTION 12.08: LEGAL HOLIDAYS. In any case when any
Interest Payment Date, Maturity Date or Redemption Date for any
Bond is not a Business Day, then payment by the Paying Agent of
such principal, interest or redemption price need not be made on
such day, but may be made on the next succeeding Business Day
with the same force and effect as if made on the scheduled
Interest Payment Date, Maturity Date or Redemption Date, and no
further interest shall accrue beyond such scheduled date.
S ECTION 12.09: ESCHEAT LAWS Notwithstanding any part or
provision of the Bonds or this Order to the contrary, the powers,
✓ ights, duties, functions and responsibilities of the District,
t he Paying Agent the Registrar, the Initial Purchaser, and the
Holders shall at all times conform and be subject to the
✓ equirements limitations, procedures and provisions of Title 6,
Texas Property Code, as now and hereafter amended, and in case of
any conflict or inconsistency therewith now existing or hereafter
created the provisions of such laws shall prevail and control,
and the provisions of this Order and the Bonds shall be deemed to
be supplemented or amended to conform thereto.
S ECTION 12.10: BENEFITS OF ORDER Nothing in this Order or
in the Bonds, expressed or implied, shall give or be construed to
give any Person, other than the District, the Paying Agent, the
12-2
Registrar, and the Holders, any legal or equitable right or claim
under or in respect of this Order, or under any covenant,
condition or provision herein contained, and all the covenants,
conditions and provisions contained in this Order or in the Bonds
shall be for the sole benefit of the District, the Paying Agent,
t he Registrar and the Holders.
S ECTION 12.11: SEVERABILITY CLAUSE. If any word, phrase,
clause, sentence paragraph, section or other part of this Order,
o r the application thereof to any Person or circumstance, shall
ever be held to be invalid or unconstitutional by any court of
competent jurisdiction, the remainder of this Order and the
application of such word phrase, clause, sentence, paragraph,
section or other part of this Order to any other Persons or
circumstances shall not be affected thereby.
S ECTION 12.12: ACCOUNTING. The District will keep proper
✓ ecords and accounts regarding the levy and collection of taxes,
which records and accounts will be made available to any Holder
o n reasonable request. Each year while any of the Bonds are
o utstanding, the District shall have an audit of its books and
accounts performed by a certified public accountant or firm of
certified public accountants, based on its Fiscal Year, and
copies of such audits will be made available to any Holder upon
✓ equest and upon payment by such Holder of the reasonable costs
t o the District of providing same.
S ECTION 12.13: NOTICE Except as otherwise expressly
provided herein, any notice, authorization, request or demand
✓ equired or permitted to be given hereunder shall be in writing
and shall be deemed to have been duly given when deposited in the
United States mail, first class postage prepaid, and addressed to
t he Person to be notified and, with respect to notice to any
Holder shall be addressed to the latest address shown on the
Register.
SECTION 12.14: FURTHER PROCEEDINGS. The President, Vice
P resident Secretary and Assistant Secretary of the Board of
Directors and other appropriate officials of the District are
h ereby authorized and directed to do any and all things necessary
and/or convenient to carry out the terms of this Order.
S ECTION 12.15: AMENDMENT OF ORDER. The District may,
without the consent of or notice to any Holder of the Bonds,
amend, change or modify this Order as may be required (a) by the
provisions hereof (including, without limitation, Article Eleven
h ereof); (b) for the purpose of curing any ambiguity, inconsis-
t ency or formal defect or omission herein; or (c) in connection
with any other change which is not to the prejudice of the
Holders of the Bonds. Except for such amendments, changes or
modifications, the District shall not amend, change or modify
12-3
t his Order in any manner without the consent of the Holders of
all the Bonds then outstanding in any manner, which would (a)
extend the time or times of payment of the principal of and
interest on the Bonds, or reduce the principal amount thereof or
t he rate or interest thereon or in any way modify the terms or
sources of payment of the principal of or interest on the Bonds;
(b) create any lien ranking prior to the lien of the Bonds; (c)
g ive preference of any Bond over any other Bonds; or (d) extend
any waiver of default to subsequent defaults.
(End of Article Twelve)
0006\Bond99\Artic112.bnd
ARTICLE THIRTEEN
SALE AND DELIVERY OF BONDS
S ECTION 13.01:
awarded to
SALE OF BONDS. Sale of the Bonds is hereby
(the "Initial
Purchaser'), for the sum of $
interest on the Bonds from the
, plus accrued
Initial Date to the date of
d elivery, subject to the issuance of an approving opinion as to
legality of the Initial Bonds of the Attorney General of Texas
and of Bond Counsel for the District. It is hereby found and
d eclared that the bid of the Initial Purchaser produces the
lowest net effective interest rate to the District and is the
best obtained for the Bonds pursuant to and after taking public
bids therefor, as required by law, and that the net effective
interest rate resulting from said bid is % which is less than
t he maximum of % permitted by the District's Official Notice
of Sale.
S ECTION 13.02: NOTICE OF SALE It is hereby affirmatively
found and declared that notice of the time and place of this sale
and the details concerning the sale of the Bonds was given by
publishing an appropriate notice of sale:
(a) at least one (1) time not less than ten (10) days
before the date of sale in a newspaper of general
circulation in the county in which the District is
located; and
(b) at least one (1) time in a recognized financial
publication of general circulation in the State of
Texas, as approved by the Attorney General of Texas.
S ECTION 13.03: APPROVAL, REGISTRATION AND DELIVERY. The
P resident and Secretary of the Board of Directors of the District
and Bond Counsel for the District are hereby authorized and
d irected to submit the Initial Bonds, and a transcript of the
proceedings relating to the issuance of the Bonds, to the
Attorney General of Texas for approval and, following said
approval, to submit the Initial Bonds to the Comptroller of
Public Accounts of the State of Texas for registration. Upon
registration of the Initial Bonds, the Comptroller of Public
Accounts (or a deputy designated in writing to act for such
Comptroller) shall manually sign such Comptroller's registration
certificate prescribed herein to be endorsed on each Initial
Bond. After the Initial Bonds have been registered and signed by
such Comptroller they shall be delivered to the Initial
Purchaser but only upon receipt of the full purchase price
t herefor.
0006\Bond99\Articl l 3.bnd
(End of Article Thirteen)
13-1
ARTICLE FOURTEEN
OPEN MEETING AND EFFECTIVE DATE
SECTION 14.01: OPEN MEETING. The Board of Directors
o fficially finds, determines and declares that this Order was
✓ eviewed considered and adopted at a meeting of the Board of
Directors beginning at 12 00 Noon, Houston, Texas, time on
November 15, 1999, and that a sufficient written notice of the
date, hour, place and subject of this meeting was posted at the
District s administrative office and at a place readily
accessible and convenient to the public within the District and
was timely furnished to the County Clerk of Brazoria County,
Texas, for posting on a bulletin board located at a place
convenient to the public in the Brazoria County Courthouse for
t he time prescribed by law preceding this meeting, as required by
t he Open Meetings Law, Chapter 551, Texas Government Code, as
amended and Section 49.063 of the Texas Water Code, as amended,
and that this meeting has been open to the public, as required by
law, at all times during which this Order and the subject matter
hereof has been discussed, considered and acted upon The Board
o f Directors further ratifies, approves and confirms such written
notice and the contents and posting thereof.
SECTION 14.02: EFFECTIVE DATE OF ORDER. This Order shall
t ake effect and be in full force and effect upon and after its
passage.
PASSED AND ADOPTED this 15th day of November, 1999.
President, Board of Directors
Brazoria County Municipal
Utility District No. 6, of
Brazoria County Texas
ATTEST:
S ecretary, Board of Directors
Brazoria County Municipal
Utility District No. 6, of
Brazoria County, Texas
(SEAL)
(End of Article Fourteen)
0006\Bond99\Artic114.bnd
EXHIBIT "A"
(FORM OF INITIAL BOND)
REGISTERED REGISTERED
NUMBER AMOUNT
IR- UNITED STATES OF AMERICA $
STATE OF TEXAS
COUNTY OF BRAZORIA
BRAZORIA COUNTY MUNICIPAL UTILITY DISTRICT NO. 6,
OF BRAZORIA COUNTY TEXAS
UNLIMITED TAX BOND
SERIES 1999
Interest Rate: Maturity Date:
Initial Date: CUSIP NO.:
September 1, December 1, 1999
BRAZORIA COUNTY MUNICIPAL UTILITY DISTRICT NO. 6, of
Brazoria County, Texas, a conservation and reclamation district,
a body politic and corporate and a governmental agency and
political subdivision created under the Constitution and laws of
t he State of Texas, situated in Brazoria County, Texas (herein
t he "District"), FOR VALUE RECEIVED hereby acknowledges itself
indebted to and PROMISES TO PAY TO
o r registered assigns, on the due date specified above, the
principal sum of
DOLLARS
(or so much thereof as shall not have been paid or deemed to have
been paid upon prior redemption), and to pay interest thereon
from the later of the initial date specified above or the most
✓ ecent Interest Payment Date (hereinafter defined) to which
interest has been paid or duly provided for, at the per annum
✓ ate of interest specified above, computed on the basis of a 360-
day year of twelve 30-day months. Interest hereon is payable
semiannually on March 1 and September 1 (individually, an
"Interest Payment Date") of each year, commencing on March 1,
2000, until the maturity or redemption date of this Bond, as
provided in the order of the Board of Directors of the District
duly adopted on November 15, 1999 (the 'Bond Order"), authorizing
t he issuance of this Bond, to the person in whose name this Bond
is registered at the close of business on the 15th day (whether
o r not a business day) of the calendar month next preceding such
Interest Payment Date (the "Record Date"). Principal of this
Bond due at maturity or upon prior redemption is 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 upon presentation and surrender of this
Bond at the designated corporate trust office of the agency
selected by the District for such purpose (the "Paying Agent").
Interest on this Bond is payable by,,mailing of a check of the
t aying Agent for such interest payable to, or upon written order
o f, the registered owner hereof at. the address shown. on the
✓ egistry books maintained on behalf of the District by a trust or
banking corporation or association selected by the District for
such purpose (the "Registrar') at the expense of the registered
owner or by such other customary banking arrangements as may be
acceptable to the Paying Agent and the registered owner hereof,
at the risk and expense of the registered owner hereof. The
initial Registrar and Paying Agent shall be Chase Bank of Texas,
National Association, having its principal payment office in
Dallas, Texas.
THIS BOND IS ONE OF AN AUTHORIZED ISSUE OF BONDS,
aggregating Four Million Six Hundred Ninety Thousand and No/100
Dollars ($4,690,000) (the "Bonds"), issued for the purpose or
purposes of purchasing, constructing, acquiring, owning, operat-
ing, repairing, improving, or extending a waterworks system, a
sanitary sewer system and a drainage and storm sewer system for
t he District, including, but not limited to, all additions
t hereto and all works, improvements, facilities, plants, equip-
ment, appliances, interests in property and contract rights
needed therefor, and administrative facilities needed in connec-
t ion therewith, by authority of an election held within and for
t he District on May 3, 1997, and pursuant to the Bond Order and
under and in strict conformity with the Constitution and laws of
t he State of Texas
THE TRANSFER OF THIS BOND may be accomplished by due
execution of the provisions for assignment hereon and is
✓ egisterable at the designated office of the Registrar by the
✓ egistered owner hereof, or by his duly authorized
✓ epresentative, but only in the manner and subject to the
limitations provided in the Bond Order, and only upon surrender
o f this Bond. Upon any such registration of transfer, one or
more exchange Bonds, in authorized denominations, for a like
interest rate and aggregate principal amount, shall be
authenticated by the Registrar and registered and delivered or
sent by United States mail, first class, postage prepaid, to the
t ransferee in exchange therefor. This Bond, with or without
o thers of like form and series, may in like manner be exchanged
for one or more registered bonds of other authorized
d enominations at the same interest rate and in the same aggregate
principal amount. No service charge shall be made for any such
t ransfer or exchange, but the District and/or the Registrar may
impose a charge sufficient to defray any tax or governmental
charge in connection therewith.
THE DISTRICT RESERVES THE RIGHT, AT ITS OPTION, TO REDEEM
t he bonds of this issue maturing on or after September 1, 2010,
in whole or, from time to time, in part, prior to their scheduled
maturities, on September 1 2009, or on any Interest Payment Date
t hereafter, at a price equal to the principal amount thereof to
be redeemed, plus accrued interest thereon to the date fixed for
✓ edemption. In the event that a Bond subject to redemption is in
a denomination larger than $5,000, a portion of such bond may be
✓ edeemed, but only in a principal amount equal to $5,000, or an
integral multiple thereof, and only upon the delivery of one or
more exchange bonds of the same interest rate and in aggregate
principal amount equal to the unredeemed portion of the bond so
✓ edeemed in part.
NOTICE OF THE EXERCISE OF THE RESERVED RIGHT OF REDEMPTION
will be given by mailing same to the registered owners of the
bonds to be redeemed in whole or in part, at least thirty (30)
days prior to the date fixed for redemption. By the date fixed
for redemption, due provision will have been made with the Paying
Agent for payment of the principal amount of the bonds so called
for redemption, plus accrued interest thereon 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,
such bonds, or the portions thereof so called for redemption,
shall no longer be regarded as outstanding, except for the
purpose of receiving payment from the funds provided for
✓ edemption and the rights of the owners to collect interest
which would otherwise accrue after the redemption date on the
principal of the bonds, or the portions thereof so called for
✓ edemption, will be terminated.
NEITHER THE DISTRICT NOR THE REGISTRAR SHALL BE REQUIRED to
t ransfer or exchange any bond on any date subsequent to a Record
Date and prior to the next succeeding Interest Payment Date, or
during any period beginning fifteen (15) calendar days prior to,
and ending on the date of, the mailing of any notice of
✓ edemption prior to maturity; nor shall the District or the
Registrar be required to transfer or exchange any bond so
selected for redemption, in whole or in part, when such
✓ edemption is scheduled to occur within thirty (30) calendar days
t hereafter.
PRIOR TO DUE PRESENTATION OF THIS BOND FOR REGISTRATION OF
TRANSFER, the District, the Paying Agent and the Registrar may
d eem and treat the registered owner hereof as the absolute owner
o f this Bond (whether or not this Bond shall be overdue and
notwithstanding any notation of ownership or other writing
hereon) for the purpose of receiving payment hereof, or on
account hereof, and interest due hereon, and for all other
purposes, and neither the District, the Paying Agent nor the
Registrar shall be bound or affected by any notice to the
contrary.
THE DISTRICT HAS DESIGNATED THE BONDS AS "qualified tax-
e xempt obligations" pursuant to the provisions of Section 265(b)
o f the Internal Revenue Code of 1986 in effect on the date of the
issuance of the Bonds.
THIS BOND, AND THE OTHER BONDS OF THE SERIES OF WHICH IT IS
A PART, are payable from the proceeds of an ad valorem tax levied
without legal limitation as to rate or amount upon all taxable
property within the District Reference is hereby made to the
Bond Order for a complete description of: the terms, covenants
and provisions pursuant to which this Bond and said series of
bonds are secured and made payable; the respective rights
thereunder of the registered owners of the bonds and of the
District, the Paying Agent and the Registrar; and the terms upon
which the bonds are, and are to be, registered and delivered. By
acceptance of this Bond, the owner hereof expressly assents to
all of the provisions of the Bond Order.
IT IS HEREBY CERTIFIED, RECITED AND REPRESENTED that the
issuance of this Bond and the series of bonds of which it is a
part, is duly authorized by law; that all acts, conditions, and
things required to exist and to be done precedent to and in the
issuance of this Bond and said series of bonds to render the same
lawful and valid have been properly done and performed and have
happened in regular and due time, form and manner, as required by
law; that due provision has been made for the payment of the
interest on and the principal of this Bond and the series of
bonds of which it is a part by the levy of a direct, annual ad
valorem tax upon all taxable property within the District
sufficient for said purposes; and that the issuance of this Bond
and said series of bonds does not exceed any constitutional or
statutory limitation
UNLESS AND UNTIL A CERTIFICATE OF REGISTRATION of the
Comptroller of Public Accounts of the State of Texas (or his duly
authorized deputy) has been manually executed as provided in the
Bond Order this Bond shall not be entitled to the benefit and
security of the Bond Order nor be valid or obligatory for any
purpose.
IN WITNESS WHEREOF, BRAZORIA COUNTY MUNICIPAL UTILITY
DISTRICT NO 6, of Brazoria County, Texas, has caused this Bond
t o be executed by the manual or facsimile signatures of the
P resident and Secretary of its Board of Directors and its
official seal to be impressed or placed in facsimile hereon.
BRAZORIA COUNTY MUNICIPAL
UTILITY DISTRICT NO 6 of
Brazoria County Texas
By:
President, Board of Directors
ATTEST:
S ecretary, Board of Directors
(SEAL)
OFFICE OF THE COMPTROLLER
REGISTER NO.
THE STATE OF TEXAS
I HEREBY CERTIFY that there is on file and of record in my
office a certificate of the Attorney General of the State of
Texas to the effect that this bond has been examined by him as
required by law, that he finds that it has been issued in
conformity with the Constitution and laws of the State of Texas,
and it is a valid and binding obligation of Brazoria County
Municipal Utility District No. 6, of Brazoria County, Texas, and
said bond has this day been registered by me.
WITNESS MY HAND AND SEAL OF OFFICE at Austin, Texas,
•
Comptroller of Public Accounts
of the State of Texas
ASSIGNMENT
For value received, the undersigned hereby sells, assigns
and transfers unto (print or typewrite name address and zip code
of transferee):
(Social Security or other identifying number).
the within Bond and does hereby irrevocably constitute and
appoint as attorney to
transfer said Bond on the books kept for registration thereof,
with full power of substitution in the premises.
Dated:
The signature of the Registered
Owner appearing on this Assign-
ment is hereby verified as true
and genuine and is guaranteed
by:
(Bank, Trust Company, or
Brokerage Firm)
By:
(Authorized Representative)
0006\Bond99\ExhibitA
Registered Owner
NOTICE• The signature on this
Assignment must correspond in
every particular with the
name of the Registered Owner
as it appears on the face of
the within Bond.
EXHIBIT "B"
(FORM OF PRINTED BOND)
REGISTERED REGISTERED
NUMBER AMOUNT
IR- UNITED STATES OF AMERICA $
STATE OF TEXAS
COUNTY OF BRAZORIA
BRAZORIA COUNTY MUNICIPAL UTILITY DISTRICT NO. 6,
OF BRAZORIA COUNTY TEXAS
UNLIMITED TAX BOND
SERIES 1999
Interest Rate: Maturity Date:
Initial Date: CUSIP NO.:
September 1, December 1, 1999
BRAZORIA COUNTY MUNICIPAL UTILITY DISTRICT NO. 6, of
Brazoria County, Texas, a conservation and reclamation district,
a body politic and corporate and a governmental agency and
political subdivision created under the Constitution and laws of
t he State of Texas, situated in Brazoria County, Texas (herein
t he "District"), FOR VALUE RECEIVED hereby acknowledges itself
indebted to and PROMISES TO PAY TO
o r registered assigns, on the due date specified above, the
principal sum of
DOLLARS
(or so much thereof as shall not have been paid or deemed to have
been paid upon prior redemption), and to pay interest thereon
from the later of the initial date specified above or the most
✓ ecent Interest Payment Date (hereinafter defined) to which
interest has been paid or duly provided for, at the per annum
✓ ate of interest specified above, computed on the basis of a
360-day year of twelve 30-day months. Interest hereon is payable
semiannually on March 1 and September 1 (individually, an
"Interest Payment Date") of each year, commencing on March 1,
2000, until the maturity or redemption date of this Bond, as
provided in the order of the Board of Directors of the District
duly adopted on November 15, 1999 (the 'Bond Order"), authorizing
t he issuance of this Bond, to the person in whose name this Bond
is registered at the close of business on the 15th day (whether
o r not a business day) of the calendar month next preceding such
Interest Payment Date (the 'Record Date"). Principal of this Bond
due at maturity or upon prior redemption is payable in any coin
o r currency of the United States of America which, on the date of
payment, is legal tender for the payment of debts due the United
t tates of America, upon presentation and surrender of this Bond
at the designated corporate trust office of the agency selected
by the District for such purpose (the "Paying Agent"). Interest
o n this Bond is payable, at the option of the District, by
mailing of a check of the Paying Agent for such interest payable
t o, or upon written order of, the registered owner hereof at the
address shown on the registry books maintained on behalf of the
District by a trust or banking corporation or association
selected by the District for such purpose (the "Registrar') or
by such other customary banking arrangements as may be acceptable
t o the Paying Agent and the registered owner hereof at the risk
and expense of the registered owner hereof. The initial Registrar
and Paying Agent shall be Chase Bank of Texas, National
Association, having its principal payment office in Dallas
Texas.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
BOND SET FORTH ON THE REVERSE HEREOF WHICH PROVISIONS SHALL HAVE
THE SAME FORCE AND EFFECT AS IF SET FORTH AT THIS PLACE
THIS BOND IS ONE OF AN AUTHORIZED ISSUE OF BONDS, aggregating
Four Million Six Hundred Ninety Thousand and No/100 Dollars
($4,690,000) (the "Bonds"), issued for the purpose or purposes of
purchasing, constructing, acquiring, owning, operating, repair-
ing, improving, or extending a waterworks system, a sanitary
sewer system, and a drainage and storm sewer system for the
District, including, but not limited to all additions thereto and
all works, improvements, facilities, plants, equipment, appli-
ances, interests in property and contract rights needed therefor,
and administrative facilities needed in connection therewith, by
authority of an election held within and for the District on May
3, 1997 and pursuant to the Bond Order and under and in strict
conformity with the Constitution and laws of the State of Texas.
THE TRANSFER OF THIS BOND may be accomplished by due
execution of the provisions for assignment hereon and is
✓ egisterable at the designated office of the Registrar by the
✓ egistered owner hereof, or by his duly authorized representa-
t ive, but only in the manner and subject to the limitations
provided in the Bond Order, and only upon surrender of this Bond.
Upon any such registration of transfer, one or more exchange
Bonds, in authorized denominations for a like interest rate and
aggregate principal amount, shall be authenticated by the
Registrar and registered and delivered or sent by United States
mail, first class postage prepaid to the transferee in exchange
t herefor. This Bond, with or without others of like form and
series, may in like manner be exchanged for one or more
✓ egistered bonds of other authorized denominations at the same
interest rate and in the same aggregate principal amount. No
service charge shall be made for any such transfer or exchange,
but the District and/or the Registrar may impose a charge
sufficient to defray any tax or governmental charge in connection
t herewith.
THE DISTRICT RESERVES THE RIGHT, AT ITS OPTION, TO REDEEM
the bonds of this issue maturing on or after September 1, 2010,
in whole or, from time to time, in part, prior to their scheduled
maturities, on September 1 2009, or on any Interest Payment Date
t hereafter, at a price equal to the principal amount thereof to
be redeemed, plus accrued interest thereon to the date fixed for
✓ edemption. In the event that a Bond subject to redemption is in
a denomination larger than $5,000, a portion of such bond may be
✓ edeemed, but only in a principal amount equal to $5 000, or an
integral multiple thereof, and only upon the delivery of one or
more exchange bonds of the same interest rate and in aggregate
principal amount equal to the unredeemed portion of the bond so
✓ edeemed in part.
NOTICE OF THE EXERCISE OF THE RESERVED RIGHT OF REDEMPTION
will be given by mailing same to the registered owners of the
bonds to be redeemed, in whole or in part, at least thirty (30)
days prior to the date fixed for redemption. By the date fixed
for redemption, due provision will have been made with the Paying
Agent for payment of the principal amount of the bonds so called
for redemption, plus accrued interest thereon 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,
such bonds, or the portions thereof so called for redemption,
shall no longer be regarded as outstanding, except for the
purpose of receiving payment from the funds provided for
✓ edemption, and the rights of the owners to collect interest
which would otherwise accrue after the redemption date on the
principal of the bonds, or the portions thereof so called for
✓ edemption, will be terminated.
NEITHER THE DISTRICT NOR THE REGISTRAR SHALL BE REQUIRED to
t ransfer or exchange any bond on any date subsequent to a Record
Date or during any period beginning fifteen (15) calendar days
prior to, and ending on the date of, the mailing of any notice of
✓ edemption prior to maturity; nor shall the District or the
Registrar be required to transfer or exchange any bond so
selected for redemption, in whole or in part, when such
✓ edemption is scheduled to occur within thirty (30) calendar days
t hereafter.
PRIOR TO DUE PRESENTATION OF THIS BOND FOR REGISTRATION OF
TRANSFER, the District, the Paying Agent and the Registrar may
d eem and treat the registered owner hereof as the absolute owner
o f this Bond (whether or not this Bond shall be overdue and
n otwithstanding any notation of ownership or other writing
h ereon) for the purpose of receiving payment hereof, or on
account hereof, and interest due hereon, and for all other
purposes, and neither the District, the Paying Agent nor the
Registrar shall be bound or affected by any notice to the
contrary.
THE DISTRICT HAS DESIGNATED THE BONDS AS "qualified
t ax-exempt obligations" pursuant to the provisions of Section
265(b) of the Internal Revenue Code of 1986 in effect on the date
of the issuance of the Bonds.
THIS BOND, AND THE OTHER BONDS OF THE SERIES OF WHICH IT IS
A PART, are payable from the proceeds of an ad valorem tax levied
without legal limitation as to rate or amount upon all taxable
property within the District. Reference is hereby made to the
Bond Order for a complete description of: the terms, covenants
and provisions pursuant to which this Bond and said series of
bonds are secured and made payable; the respective rights
thereunder of the registered owners of the bonds and of the
District, the Paying Agent and the Registrar; and the terms upon
which the bonds are, and are to be, registered and delivered. By
acceptance of this Bond, the owner hereof expressly assents to
all of the provisions of the Bond Order.
IT IS HEREBY CERTIFIED, RECITED AND REPRESENTED that the
issuance of this Bond and the series of bonds of which it is a
part, is duly authorized by law; that all acts, conditions, and
things required to exist and to be done precedent to and in the
issuance of this Bond and said series of bonds to render the same
lawful and valid have been properly done and performed and have
happened in regular and due time, form and manner, as required by
law; that due provision has been made for the payment of the
interest on and the principal of this Bond and the series of
bonds of which it is a part by the levy of a direct, annual ad
valorem tax upon all taxable property within the District
sufficient for said purposes; and that the issuance of this Bond
and said series of bonds does not exceed any constitutional or
statutory limitation
UNLESS AND UNTIL A CERTIFICATE OF REGISTRATION of the
Registrar has been manually executed by an authorized
representative of the Registrar as provided in the Bond Order,
t his Bond shall not be entitled to the benefit and security of
t he Bond Order nor be valid or obligatory for any purpose.
IN WITNESS WHEREOF, BRAZORIA COUNTY MUNICIPAL UTILITY
DISTRICT NO 6, of Brazoria County, Texas, has caused this Bond
t o be executed by the manual or facsimile signatures of the
P resident and Secretary of its Board of Directors and its
official seal to be impressed or placed in facsimile hereon.
BRAZORIA COUNTY MUNICIPAL
UTILITY DISTRICT NO 6 of
Brazoria County Texas
By:
ATTEST: President, Board of Directors
By:
Secretary, Board of Directors
(SEAL)
CERTIFICATE OF REGISTRAR
This is to certify that this bond is one of the bonds issued
under the provisions of the within -mentioned Bond Order, and it
is hereby further certified that this bond has been authorized
and delivered in conversion and exchange for, or in replacement
o f, a bond, bonds or portions thereof (or one or more prior
conversion, exchange or replacement bonds) originally issued by
Brazoria County Municipal Utility District No. 6, of Brazoria
County Texas, approved by the Attorney General of Texas, and
initially registered by the Comptroller of Public Accounts of the
State of Texas.
, Registrar
Dated: By:
Authorized Signatory
ASSIGNMENT
For value received, the undersigned hereby sells, assigns
and transfers unto (print or typewrite name address and zip code
o f transferee):
(Social Security or other identifying number): the
within Bond and does hereby irrevocably constitute and appoint
as attorney to transfer said
Bond on the books kept for registration thereof, with full power
o f substitution in the premises.
Dated:
The signature of the Registered
Owner appearing on this Assign-
ment is hereby verified as true
and genuine and is guaranteed
by:
(Bank, Trust Company, or
Brokerage Firm)
By:
(Authorized Representative)
0006\Bond99\ExhibitB
Registered Owner
NOTICE: The signature on this
Assignment must correspond in
every particular with the name
of the Registered Owner as it
appears on the face of the
within Bond.
EXHIBIT "C"
CONTINUING DISCLOSURE
The information to be updated includes all quantitative
financial information and operating data with respect to the
District of the general type included in the Official Statement
under the sections entitled: "APPENDIX A".
The Municipal Advisory Council of Texas ("MAC"), has been
d esignated by the State of Texas as a SID and has been recognized
by the SEC as a qualified SID. The current mailing address and
t elephone number of MAC is: P.O. Box 2177, Austin, Texas 78768-
2177, (512) 476-6947.
Any financial statements of the District will be prepared in
accordance with generally accepted accounting principles for
local government units as prescribed by the Governmental
Accounting Standards Board or such other accounting principles as
t he District may be required to employ from time to time pursuant
t o State law or regulation.
0006\Bond99\ExhibitC