Ord. 1624 2023-03-27 CERTIFICATE FOR ORDINANCE
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA, FORT BEND AND HARRIS §
CITY OF PEARLAND §
I, the undersigned officers of the City of Pearland, Texas (the "City"), hereby
certify as follows.
1 The City Council of the City convened in a regular meeting on March 27, 2023, at
the regular meeting place thereof, within the City, and the roll was called of the duly constituted
officers and members of the City Council,to wit:
Kevin Cole Mayor
Tony Carbone Mayor Pro Tern
Joseph Koza Councilmember
Alex Kamkar Councilmember
Adrian Hernandez Councilmember
Layni Cade Councilmember
Jeffrey Barry Councilmember
Woody Owens Councilmember
and all of such persons were present, except , thus constituting a quorum.
Whereupon, among other business, the following was transacted at said meeting• a written
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF PEARLAND,
TEXAS, PERMANENT IMPROVEMENT REFUNDING BONDS IN ONE OR
MORE SERIES, SETTING CERTAIN PARAMETERS FOR THE BONDS,
AUTHORIZING REFUNDING OF CERTAIN OUTSTANDING
OBLIGATIONS, AUTHORIZING A PRICING OFFICER TO APPROVE THE
AMOUNT, THE INTEREST RATE, PRICE, AND TERMS THEREOF AND
CERTAIN OTHER PROCEDURES AND PROVISIONS RELATING
THERETO
(the "Ordinance") was duly introduced for the consideration of the City Council and read in full.
It was then duly moved and seconded that the Ordinance be adopted, and, after due discussion,
such motion, carrying with it the adoption of the Ordinance, prevailed and carried by the
following vote:
AYES NAYS ABSTENTIONS
2. That a true, full and correct copy of the Ordinance adopted at the meeting
described in the above and foregoing paragraph is attached to and follows this certificate; that the
Ordinance has been duly recorded in the City Council's minutes of such meeting; that the above
and foregoing paragraph is a true, full and correct excerpt from the City Council's minutes of
such meeting pertaining to the adoption of the Ordinance; that the persons named in the above
and foregoing paragraph are the duly chosen, qualified and acting officers and members of the
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City Council as indicated therein, that each of the officers and members of the City Council was
duly and sufficiently notified officially and personally, in advance, of the date, hour, place and
subject of the aforesaid meeting, and that the Ordinance would be introduced and considered for
adoption at such meeting, and each of such officers and members consented, in advance, to the
holding of such meeting for such purpose; that such meeting open to the public, via
teleconference and video conference in compliance with an advisory issued by the Office of the
Governor; and that public notice of the date, hour, place and subject of such meeting was given
as required by the Open Meetings Law, Chapter 551,Texas Government Code.
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SIGNED AND SEALED this (mil g 2023
(pqs7m
City Secretary
OF PEARLAND, TEXAS Y OF PEARLAND, TEXAS
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4133-2852-5381.1
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF PEARLAND,
TEXAS, PERMANENT IMPROVEMENT REFUNDING BONDS IN ONE OR
MORE SERIES, SETTING CERTAIN PARAMETERS FOR THE BONDS,
AUTHORIZING' REFUNDING OF CERTAIN OUTSTANDING
OBLIGATIONS, AUTHORIZING A PRICING OFFICER TO APPROVE THE
AMOUNT, THE INTEREST RATE, PRICE, AND TERMS THEREOF AND
CERTAIN OTHER PROCEDURES AND PROVISIONS RELATING
THERETO
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA,FORT BEND AND HARRIS §
CITY OF PEARLAND §
WHEREAS, the City of Pearland, Texas (the "City"), acting through its City Council, is
authorized by Section 3.07 of its Home Rule Charter and the Constitution and laws of the State
of Texas,particularly Chapters 1331 of the Texas Government Code, as amended, to issue bonds
for the purpose of making needed public improvements,
WHEREAS, the City Council of the City has heretofore issued or assumed the
obligations described in Exhibit A attached hereto and as more particularly described in the
Officer's Pricing Certificate (defined herein), and
WHEREAS, the City desires to refund part of said obligations in advance of their
maturities as determined pursuant to the parameters set forth herein (the "Refunded Bonds") for
the purpose of achieving debt service savings, and
WHEREAS, Chapter' 1207, Texas Government Code, as amended ("Chapter 1207")
authorizes the City to issue refunding bonds payable from taxes, without an election, for the
purpose of refunding the Refunded Bonds in advance of their maturities, and to accomplish such
refunding by depositing directly with any paying agent for the Refunded Bonds (or other
qualified escrow agent), the proceeds of such refunding bonds, together with other available
funds, in an amount sufficient to provide for the payment or redemption of the Refunded Bonds,
and provides that such deposit shall constitute the making of firm banking and financial
arrangements for the discharge and final payment or redemption of the Refunded Bonds, and
WHEREAS, the City desires to authorize the execution of an escrow agreement, if
necessary, and provide for the deposit of proceeds of the refunding bonds, together with other
lawfully available funds of the City, to pay the Refunded Bonds, and
WHEREAS, upon the issuance of the refunding bonds herein authorized and the deposit
of funds referred to above, the Refunded Bonds shall no longer be regarded as being outstanding,
except for the purpose of being paid pursuant to such deposit, and the pledges, liens, trusts and
all other covenants, provisions, terms and conditions of the ordinances authorizing the issuance
of the Refunded Bonds shall be, with respect to the Refunded Bonds, discharged, terminated and
defeased,
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WHEREAS, the City is a home-rule municipality that (i) adopted its charter under
Section 5, Article XI, Texas Constitution, (ii) has a population of 50,000 or more; and (iii)has
outstanding long-term indebtedness that is rated by a nationally recognized rating agency for
municipal securities in one of the four highest rating categories for a long-term obligation and
thus the City qualifies as an "Issuer" under Chapter 1371, Texas Government Code ("Chapter
1371"); and
WHEREAS, Chapter 1207 and Chapter 1371 authorize the City to delegate the authority
to effect the sale of the Bonds to a Pricing Officer, as defined herein. Now, therefore
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PEARLAND•
1 Recitals, Consideration. It is hereby found and determined that the matters and
facts set out in the preamble to this Ordinance are true and correct.
It is hereby found and determined that the refunding contemplated in this Ordinance will
benefit the City by providing a present value savings in the debt service payable by the City, that
such benefit is sufficient consideration for the refunding of the Refunded Bonds, and that the
issuance of the refunding bonds is in the best interests of the City
2. Definitions. Throughout this Ordinance the following terms and expressions as
used herein shall have the meanings set forth below
"Blanket Issuer Letter of Representations" means the Blanket Issuer Letter of
Representations between the City, the Registrar and DTC.
"Bond Purchase Agreement" means an agreement between the City and the Underwriter
described in Section 23 of this Ordinance.
"Bonds" means the means one or more series of Bonds issued by the City of Pearland,
Texas authorized in this Ordinance, as designated in an Officer's Pricing Certificate.
"Business Day" means any day which is not a Saturday, Sunday, or a day on which the
Registrar is authorized by law or executive order to close, or a legal holiday
"City"means the City of Pearland,Texas.
"Closing Date"means the date of the initial delivery of and payment any series of Bonds.
"Code"means the Internal Revenue Code of 1986, as amended.
"Comptroller"means the Comptroller of Public Accounts of the State of Texas.
"Debt Service Fund" means the debt service fund for payment of the Bonds established
by the City in Section 20 of this Ordinance.
"DTC" means The Depository Trust Company of New York, New York, or any
successor securities depository
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"DTC Participant" means brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations on whose behalf DTC was created to hold securities
to facilitate the clearance and settlement of securities transactions among DTC Participants.
"Escrow Agent"has the meaning set forth in the Officer's Pricing Certificate
"Escrow Agreement" means an agreement between the City and the Escrow Agent
relating to the escrow of funds to pay the Refunded Bonds.
"Initial Bond"means the Initial Bond authorized by Section 6(d).
"Interest Payment Date", when used in connection with any Bond, means shall'mean the
date(s) determined by a Pricing Officer and set forth in the Officer's Pricing Certificate.
"MSRB"means the Municipal Securities Rulemaking Board.
"Officer's Pricing Certificate" means accertificate signed by the Pricing Officer pursuant
to Section 5 hereof.
"Ordinance" as used herein and in the Bonds means this ordinance authorizing the Bonds.
"Owner"means any person who shall be the registered owner of any outstanding Bond.
"Pricing Officer" means the Mayor, City Manager, Interim City Manager, the Director of
Finance, Deputy Director of Finance or Chief Financial Officer
"Record Date" means, with respect to the Bonds, the close of business on the 15th
calendar day of the month preceding such Interest Payment Date
"Refunded Bonds" means any of the obligations described on Exhibit A attached hereto
and as more specifically described in the Officer's Pricing Certificate.
"Register" means the books of registration kept by the Registrar, in which are maintained
the names and addresses of, and the principal amounts of the Bonds registered to, each Owner
"Registrar"has the meaning set forth in the Officer's Pricing Certificate
"Report" means the report verifying the accuracy of certain mathematical computations
relating to the Bonds and the Refunded Bonds as further described in the Escrow Agreement.
"Rule"means SEC Rule 15c2-12, as amended from time to time.
"SEC"means the United States Securities and Exchange Commission.
"Underwriters" means the firms listed in the Officer's Pricing Certificate as the
underwriters or initial purchasers of the Bonds.
3 Authorization. The Bonds shall be issued in fully registered form if certain
savings thresholds are achieved, in an amount not to exceed $32,435,000 for the purpose of
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refunding the Refunded Bonds, under and in strict conformity with the Constitution and laws of
the State of Texas, particularly Chapters 1207, Texas Government Code and the costs of issuing
the Bonds. The Bonds may be issued in one or more series/installments.
4 Date, Denomination, Interest Rates, and Maturities The Bonds shall be
designated as City of Pearland, Texas Permanent Improvement 1 and shall be dated the date set
forth in the Officer's Pricing Certificate, shall mature on March 1 in each of the years and in the
amounts set out in the Officer's Pricing Certificate, shall be subject to prior optional and
mandatory redemption on the dates, for the redemption prices and in the amounts set out in the
Officer's Pricing Certificate and shall bear interest from their issuance date at the rates set forth
in the Officer's Pricing Certificate payable on each March 1 and September 1 commencing on
the date set forth in the Officer's Pricing Certificate. The Bonds may be transferred and
exchanged as set out in this Ordinance. The Initial Bond shall be numbered I-1 and all other
Bonds shall be numbered in sequence beginning with R-1 Bonds delivered on transfer of or in
exchange for other Bonds shall be numbered in order of their authentication by the Registrar,
shall be in the denomination of$5,000 or integral multiples thereof, and shall mature on the same
date and bear interest on the same rate as the Bond or Bonds in lieu of which they are delivered.
5 Selling and Delivering the Bonds. As authorized by Sections 1207 and 1371,
Texas Government Code, as amended, the Pricing Officer is hereby authorized to act on behalf
of the City in selling and delivering the Bonds, in one or more series of bonds/installments, as
taxable or tax exempt Bonds, and carrying out the other procedures specified in this Ordinance,
including without limitation determining the price at which the Bonds will be sold, the issuance
date for the Bonds, the form in which the Bonds shall be issued (whether as current interest
bonds or as any combination of current interest bonds and compound interest bonds), the years in
which the Bonds will mature, the principal amount to mature in each of such years, the rate of
interest to be borne by each such maturity, the dates, prices and terms upon and at which the
Bonds shall be subject to redemption prior to maturity at the option of the City, as well as any
mandatory redemption provisions for the Bonds, and all other matters not expressly provided in
this Ordinance, relating to the issuance, sale and delivery of the Bonds, and the refunding of the
Refunded Bonds, all of which shall be specified in the Officer's Pricing Certificate, provided
that:
(i) none of the Bonds shall bear interest at a rate in excess of the maximum rate
allowed by Chapter 1204, Texas Government Code, as amended,
(ii) the aggregate principal amounts of the Bonds may not exceed the maximum
principal amounts authorized in Section 3 hereof, and the proceeds from the sale
of the Bonds, along with any available funds of the City to be used in the
refunding, must be sufficient to provide, after all original issue discount and
underwriter's discount, amounts necessary to fund the costs and expenses of
refunding the Refunded Bonds and the estimated costs of issuance of the Bonds,
(iii) the net present value savings in debt service resulting from the refunding of the
Refunded Bonds shall be at least 3% of the principal amount of the Refunded
1 Insert from Pricing Certificate.
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Bonds, as shown by a table of calculations prepared by the City's financial
advisor and attached to the Officer's Pricing Certificate, and
(iv) the refunding of the Refunded Bonds shall be undertaken to achieve debt service
savings and not for the purpose of restructuring or shortening the amortization of
debt evidenced by the Refunded Bonds.
6 Execution of Bonds, Seal. (a) The Bonds shall be signed on behalf of the City by
the Mayor and countersigned by the City Secretary, by their manual, lithographed, or facsimile
signatures, and the official seal of the City shall be impressed or placed in facsimile thereon.
Such facsimile signatures on the Bonds shall have the same effect as if each of the Bonds had
been signed manually and in person by each of said Officer's, and such facsimile seal on the
Bonds shall have the same effect as if the official seal of the City had been manually impressed
upon each of the Bonds.
(b) If any officer of the City whose manual or facsimile signature shall appear on the
Bonds shall cease to be such officer before the authentication of such Bonds or before the
delivery of such Bonds, such manual or facsimile signature shall nevertheless be valid and
sufficient for all purposes as if such officer had remained in such office.
(c) Except as provided below, no Bond shall be valid or obligatory for any purpose or
be entitled to any security or benefit of this Ordinance unless and until there appears thereon the
Registrar's Authentication Bond substantially in the form provided herein, duly authenticated by
manual execution by an officer or duly authorized signatory of the Registrar In lieu of the
executed Registrar's Authentication Bond described above, the Initial Bond delivered at the
Closing Date shall have attached hereto the Comptroller's Registration Certificate substantially
in the form provided herein, manually executed by the Comptroller, or by his duly authorized
agent, which certificate shall be evidence that the Initial Bond has been duly approved by the
Attorney General of the State of Texas and that it is a valid and binding obligation of the City,
and has been registered by the Comptroller
(d) On the Closing Date, the Initial Bond, being a single bond representing the entire
principal amount of the Bonds, payable in stated installments to the Underwriter'or its designee,
executed by manual or facsimile signature of the Mayor and City Secretary of the City, approved
by the Attorney General, and registered and manually signed by the Comptroller, shall be
delivered to the Underwriter or its designee. Upon payment for the Initial Bond, the Registrar
shall cancel the Initial Bond and deliver definitive Bonds to DTC.
7 Payment of Principal and Interest. The Registrar is hereby appointed as the
paying agent and registrar for the Bonds. The principal of the Bonds shall be payable, without
exchange or collection charges, in any coin or currency of the United States of America which,
on the date of payment, is legal tender for the payment of debts due the United States of
America, upon their presentation and surrender as they respectively become due and payable at
the principal payment office of the Registrar The interest on each Bond shall be payable on
each Interest Payment Date, by check mailed by the Registrar on or before the Interest Payment
Date to the Owner of record as of the Record Date.
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If the date for payment of the principal of or interest on any Bond is not a Business Day,
then the date for such payment shall be the next succeeding Business Day with the same force
and effect as if made on the date payment was originally due.
8. Successor Registrars. The City covenants that at all times while any Bonds are
outstanding it will provide a commercial bank or trust company, organized under the laws of the
United States or any state, and duly qualified and legally authorized to serve as Registrar for the
Bonds. The City reserves the right to change the Registrar on not less than 60 days written
notice to the Registrar, so long as any such notice is effective not less than 60 days prior to the
next succeeding principal or interest payment date on the Bonds. Promptly upon the
appointment of any successor Registrar, the previous Registrar shall deliver the Register or
copies thereof to the new Registrar, and the new Registrar shall notify each Owner, by United
States mail, first class postage prepaid, of such change and of the address of the new Registrar
Each Registrar hereunder, by acting in that capacity, shall be deemed to have agreed to the
provisions of this Section.
9 Special Record Date. If interest on any Bond is not paid on any Interest Payment
Date and continues unpaid for thirty (30) days thereafter, the Registrar shall establish a new
record date for the payment of such interest, to be known as a Special Record Date The
Registrar shall establish a Special Record Date when funds to make such interest payment are
received from or on behalf of the City Such Special Record Date shall be fifteen (15) days prior
to the date fixed for payment of such past due interest, and notice of the date of payment and the
Special Record Date shall be sent by United States mail, first class, postage prepaid, not later
than five (5) days prior to the Special Record Date, to each affected Owner of record as of the
close of business on the day prior to the mailing of such notice.
10 Ownership; Unclaimed Principal and Interest. The City, the Registrar and any
other person may treat the person in whose name any Bond is registered as the absolute owner of
such Bond for the purpose of making and receiving payment of the principal of or interest on
such Bond, and for all other purposes, whether or not such Bond is overdue, and neither the City
nor the Registrar shall be bound by any notice or knowledge to the contrary All payments made
to the person deemed to be the Owner of any Bond in accordance with this Section shall be valid
and effectual and shall discharge the liability of the City and the Registrar upon such Bond to the
extent of the sums paid.
Amounts held by the Registrar which represent principal of and interest on the Bonds
remaining unclaimed by the Owner after the expiration of three years from the date such
amounts have become due and payable shall be reported and disposed of by the Registrar in
accordance with the applicable provisions of Texas law including, to the extent applicable, Title
6 of the Texas Property Code, as amended.
11 Registration, Transfer, and Exchange. So long as any Bonds remain outstanding,
the Registrar shall keep the Register at its principal payment office, and, subject to such
reasonable regulations as it may prescribe, the Registrar shall provide for the registration and
transfer of Bonds in accordance with the terms of this Ordinance.
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Each Bond shall be transferable only upon the presentation and surrender thereof at the
principal payment office of the Registrar, duly endorsed for transfer, or accompanied by an
assignment duly executed by the registered Owner or his authorized representative in form
satisfactory to the Registrar Upon due presentation of any Bond for transfer, the Registrar shall
authenticate and deliver in exchange therefor, within three Business Days after such presentation,
a new Bond or Bonds registered in the name of the transferee or transferees, in authorized
denominations and of the same maturity and aggregate principal amount and bearing interest at
the same rate as the Bond or Bonds so presented.
All Bonds shall be exchangeable upon presentation and surrender thereof at the principal
payment office of the Registrar, for a Bond or Bonds of like maturity and interest rate and in any
authorized denomination, in an aggregate amount equal to the unpaid principal amount of the
Bond or Bonds presented for exchange. The Registrar shall be and is hereby authorized to
authenticate and deliver exchange Bonds in accordance with the provisions of this Section. Each
Bond delivered in accordance with this Section shall be entitled to the benefits and security of
this Ordinance to the same extent as the Bond or Bonds in lieu of which such Bond is delivered.
The City or the Registrar may require the Owner of any Bond to pay a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection with the transfer
or exchange of such Bond. Any fee or charge of the Registrar for such transfer or exchange shall
be paid by the City
12. Mutilated, Lost, or Stolen Bonds. Upon the presentation and surrender to the
Registrar of a mutilated Bond, the Registrar shall authenticate and deliver in exchange therefor a
replacement Bond of like maturity, interest rate, and principal amount, bearing a number not
contemporaneously outstanding. If any Bond is lost, apparently destroyed, or wrongfully taken,
the City, pursuant to the applicable laws of the State of Texas and in the absence of notice or
knowledge that such Bond has been acquired by a bona fide purchaser, shall authorize and'the
Registrar shall authenticate and deliver a replacement Bond of like maturity, interest rate and
principal amount,bearing a number not contemporaneously outstanding.
The City or the Registrar may require the Owner of a mutilated Bond to pay a sum
sufficient to cover any tax or other governmental charge that may be imposed in connection
therewith and any other expenses connected therewith, including the fees and expenses of the
Registrar The City or the Registrar may require the Owner of a lost, apparently destroyed or
wrongfully taken Bond,before any replacement Bond is issued, to
(i) furnish to the City and the Registrar satisfactory evidence of the ownership of and
the circumstances of the loss, destruction or theft of such Bond,
(ii) furnish such security or indemnity as may be required by the Registrar and the
City to save them harmless,
(iii) pay all expenses and charges in connection therewith, including, but not limited
to, printing costs, legal fees, fees of the Registrar and any tax or other
governmental charge that may be imposed, and
(iv) meet any other reasonable requirements of the City and the Registrar
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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 City
and the Registrar shall be entitled to recover such replacement Bond from the person to whom it
was delivered or any person taking therefrom, except a bona fide purchaser, and shall be entitled
to recover upon the security or indemnity provided therefor to the extent of any loss, damage,
cost or expense incurred by the City or the Registrar in connection therewith.
If any such mutilated, lost, apparently destroyed or wrongfully taken Bond has become or
is about to become due and payable, the City in its discretion may, instead of issuing a
replacement Bond, authorize the Registrar to pay such Bond.
Each replacement Bond delivered in accordance with this Section shall be entitled to the
benefits and security of this Ordinance to the same extent as the,Bond or Bonds in lieu of which
such replacement Bond is delivered.
13 Cancellation of Bonds. All Bonds paid in accordance with this Ordinance, and all
Bonds in lieu of which exchange Bonds or replacement Bonds are authenticated and delivered in
accordance herewith, shall be canceled and destroyed upon the making of proper records
regarding such payment. The Registrar shall furnish the City with appropriate certificates of
destruction of such Bonds.
14 Book-Entry Only System. (a) The Initial Bond shall be registered in the name of
the Underwriters. Except as provided in Section 15 hereof, all other Bonds shall be registered in
the name of Cede &Co., as nominee of DTC.
(b) With respect to Bonds registered in the name of Cede & Co., as nominee of DTC,
the City and the Registrar shall have no responsibility or obligation to any DTC Participant or to
any person on behalf of whom such DTC Participant holds an interest in the Bonds, except as
provided in this Ordinance. Without limiting the immediately preceding sentence, the City and
the Registrar shall have no responsibility or obligation with respect to (i)the accuracy of the
records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in
the Bonds, (ii) the delivery to any DTC Participant or any other person, other than an Owner, as
shown on the Register, of any notice with respect to the Bonds, including any notice of
redemption, or (iii) the payment to any DTC Participant or any other person, other than an
Owner, as shown on the Register, of any amount with respect to principal of, premium, if any, or
interest on the Bonds. Notwithstanding any other provision of this Ordinance to the contrary, the
City and the Registrar shall be entitled to treat and consider the person in whose name each Bond
is registered in the Register as the absolute Owner of such Bond for the purpose of payment of
principal of and interest on the Bonds, for the purpose of giving notices of redemption and other
matters with respect to such Bond, for the purpose of registering transfer with respect to such
Bond, and for all other purposes whatsoever The Registrar shall pay all principal of, premium,
if any, and interest on the Bonds only to or upon the order of the respective Owners, as shown in
the Register as provided in this Ordinance, or their respective attorneys duly authorized in
writing, and all such payments shall be valid and effective to fully satisfy and discharge the
City's obligations with respect to payments of principal, premium, if any, and interest on the
Bonds to the extent of the sum or sums so paid. No person other than an Owner, as shown in the
Register, shall receive a Bond certificate evidencing the obligation of the City to make payments
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of amounts due pursuant to this Ordinance. Upon delivery by DTC to the Registrar of written
notice to the effect that DTC has determined to substitute a new nominee in place of Cede&Co.,
and subject to the provisions of this Ordinance with respect to interest checks being mailed to the
Owner of record as of the Record Date, the phrase "Cede & Co." in this Ordinance shall refer to
such new nominee of DTC.
15 Successor Securities Depository; Transfer Outside Book-Entry Only System. In
the event that the City in its1 sole discretion, determines that the beneficial owners of the Bonds
be able to obtain certificated Bonds, or in the event DTC discontinues the services described
herein, the City shall (i) appoint a successor securities depository, qualified to act as such under
Section 17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC
Participants, as identified by DTC, of the appointment of such successor securities depository
and transfer one or more separate Bonds to such successor securities depository or (ii) notify
DTC and DTC Participants, as identified by DTC, of the availability through DTC of Bonds and
transfer one or more separate Bonds to DTC Participants having Bonds credited to their DTC
accounts, as identified by DTC. In such event, the Bonds shall no longer be restricted to being
registered in the Register in the name of Cede & Co., as nominee of DTC, but may be registered
in the name of the successor securities depository, or its nominee, or in whatever name or names
Owners transferring or exchanging Bonds shall designate, in accordance with the provisions of
this Ordinance.
16 Payments to Cede & Co. Notwithstanding any other provision of this Ordinance
to the contrary, so long as any Bonds are registered in the name of Cede & Co , as nominee of
DTC, all payments with respect to principal of, premium, if any, and interest on such Bonds, and
all notices with respect to such Bonds, shall be made and given, respectively, in the manner
provided in the Blanket Letter of Representations.
17 Optional and/or Mandatory Redemption, Defeasance. The Bonds are subject to
optional and/or mandatory redemption as set forth in the Form of Bond in this Ordinance and in
the Officer's Pricing Certificate.
Principal amounts may be redeemed only in integral multiples of $5,000 If a Bond
subject to redemption is in a denomination larger than $5,000, a portion of such Bond may be
redeemed, but only in integral multiples of$5,000 Upon surrender of any Bond for redemption
in part, the Registrar, in accordance with Section 11 hereof, shall authenticate and deliver in
exchange therefor a Bond or Bonds of like maturity and interest rate in an aggregate principal
amount equal to the unredeemed portion of the Bond so surrendered.
Notice of any redemption identifying the Bonds to be redeemed in whole or in part shall
be given by the Registrar at least thirty days prior to the date fixed for redemption by sending
written notice by first class mail to the Owner of each Bond to be redeemed in whole or in part at
the address shown on the Register Such notices shall state the redemption date, the redemption
price, the place at which Bonds are to be surrendered for payment and, if less than all Bonds
outstanding of a particular maturity are to be redeemed, the numbers of the Bonds or portions
thereof of such maturity to be redeemed. Any notice given as provided in this Section shall be
conclusively presumed to have been duly given, whether or not the Owner receives such notice
By the date fixed for redemption, due provision shall be made with the Registrar for payment of
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the redemption price of the Bonds or portions thereof to be redeemed, plus accrued interest to the
date fixed for redemption. When Bonds have been called for redemption in whole or in part and
due provision has been made to redeem same as herein provided, the Bonds or portions thereof
so redeemed shall no longer be regarded as outstanding except for the purpose of receiving
payment solely from the funds so provided for redemption, and the rights of the Owners to
collect interest which would otherwise accrue after the redemption date on any Bond or portion
thereof called for redemption shall terminate on the date fixed for redemption.
The City reserves the right to give notice of its election or direction to optionally redeem
Bonds conditioned upon the occurrence of subsequent events. Such notice may state (i)that the
redemption is conditioned upon the deposit of moneys and/or authorized securities, in an amount
equal to the amount necessary to effect the redemption, with the Paying Agent/Registrar, or such
other entity as may be authorized by law, no later than the redemption date or (ii)that the City
retains the right to rescind such notice at any time prior to the scheduled redemption date if the
City delivers a certificate of the City to the Paying Agent/Registrar instructing the Paying Agent
/Registrar to rescind the redemption notice, and such notice of redemption shall be of no effect if
such moneys and/or authorized securities are no so deposited or if the notice is rescinded. The
Paying Agent/Registrar shall give prompt notice of any such rescission of a conditional notice of
redemption to the affected owners. Any Bonds subject to conditional redemption where
redemption has been rescinded shall remain Outstanding.
The Bonds may be discharged, defeased, redeemed or refunded in any manner now or
hereafter permitted by law,unless otherwise provided in the Officer's Pricing Certificate.
18. Forms. The form of the Bond, including the form of Registration Certificate of
the Comptroller, which shall be attached or affixed to the Initial Bond, the form of Assignment
and the form of the Registrar's Authentication Certificate, shall be, respectively, substantially as
follows, with such additions, deletions and variations as may be necessary to conform to the
terms specified in the Officer's Pricing Certificate:
(a) Form of Bond.
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTIES OF BRAZORIA,FORT BEND AND HARRIS
REGISTERED REGISTERED
NUMBER DENOMINATION
CITY OF PEARLAND, TEXAS
PERMANENT IMPROVEMENT 2
INTEREST RATE. MATURITY DATE. DATED DATE. CUSIP•
March 1, 20_ 3
2 Insert from Officer's Pricing Certificate.
3 Insert from Officer's Pricing Certificate.
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4133-2852-5381 1
REGISTERED OWNER.4
PRINCIPAL AMOUNT DOLLARS
The City of Pearland, Texas (the "City") promises to pay to the registered owner
identified above, or registered assigns, on the maturity date specified above, upon presentation
and surrender of this Bond at the principal payment office of 5 (the "Registrar"),
the principal amount identified above, payable in any coin or currency of the United States of
America which on the date of payment is legal tender for the payment of debts due the United
States of America, and to pay interest thereon at the rate shown above, calculated on the basis of
a 360-day year of twelve 30-day months, from 6, or the most recent interest payment date to
which interest has been paid or duly provided for Interest on this Bond is payable by check on
March 1 and September 1 beginning on 7, mailed to the registered owner of record as of the
close of business on the 15th day of the month preceding each interest payment date.
THIS BOND is one of a duly authorized issue of Bonds, aggregating $ 8 _ (the
"Bonds"), issued for the purpose of refunding a portion of the City's outstanding obligations,
under and in strict conformity with the Constitution and laws of the State of Texas, particularly
Chapters 1207 and 1371, Texas Government Code, as amended, and pursuant to an ordinance
adopted by the City Council (the "Ordinance"), which Ordinance is of record in the official
minutes of the City
THE CITY RESERVES THE RIGHT, at its option, to redeem Bonds maturing on and
after March 1, 20 9 , in whole or from time to time in part, in integral multiples of $5,000, on
March 1, 2010 , or any date thereafter at par plus accrued interest on the principal amounts called
for redemption to the date fixed for redemption. If less than all the Bonds are to be redeemed,
the City shall select the Bonds to be redeemed.
[If applicable, mandatory redemption language]
NOTICE OF ANY REDEMPTION shall be given by the Registrar at least thirty
(30) days prior to the date fixed for redemption by first class mail, addressed to the registered
owners of each Bond to be redeemed in whole or in part at the address shown on the books of
registration kept by the Registrar When Bonds or portions thereof have been called for
redemption, and due provision has been made to redeem the same, the principal amounts so
redeemed shall be payable solely from the funds provided for redemption, and interest which
4 Insert from Officer's Pricing Certificate.
5 Insert from Officer's Pricing Certificate.
6 Insert from Officer's Pricing Certificate.
Insert from Officer's Pricing Certificate.
8 Insert from Officer's Pricing Certificate.
9 Insert from Officer's Pricing Certificate.
10 Insert from Officer's Pricing Certificate.
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4133-2852-5381 1
would otherwise accrue on the amounts called for redemption shall terminate on the date fixed
for redemption.
THIS BOND IS TRANSFERABLE only upon presentation and surrender at the principal
payment office of the Registrar, duly endorsed for transfer or accompanied by an assignment
duly executed by the registered owner or his authorized representative, subject to the terms and
conditions of the Ordinance.
THE BONDS ARE EXCHANGEABLE at the principal payment office of the Registrar,
for Bonds in the principal amount of$5,000 or any integral multiple thereof, subject to the terms
and conditions of the Ordinance.
THIS BOND shall not be valid or obligatory for any purpose or be entitled to any benefit
under the Ordinance unless this Bond is either (i) registered by the Comptroller of Public
Accounts of the State of Texas by registration certificate attached or affixed hereto or
(ii) authenticated by the Registrar by due execution of the authentication certificate endorsed
hereon.
THE REGISTERED OWNER of this Bond, by acceptance hereof, acknowledges and
agrees to be bound by all the terms and conditions of the Ordinance.
THE CITY has covenanted in the Ordinance that it will at all times provide a legally
qualified registrar for the Bonds and will cause notice of any change of registrar to be mailed to
each registered owner
IT IS HEREBY certified, recited and covenanted that this Bond has been duly and validly
issued and delivered, that all acts, conditions and things required or proper to be performed, to
exist and to be done precedent to or in the issuance and delivery of this Bond have been
performed, exist and have been done in accordance with law; and that annual ad valorem taxes,
within the limits prescribed by law, sufficient to provide for the payment of the interest on and
principal of this Bond, as such interest comes due and such principal matures, have been levied
and ordered to be levied against all taxable property in the City, and have been pledged
irrevocably for such payment.
IN WITNESS WHEREOF, this Bond has been signed with the manual or facsimile
signature of the Mayor and countersigned with the manual or facsimile signature of the City
Secretary, and the official seal of the City has been duly impressed, or placed in facsimile, on
this Bond.
(AUTHENTICATION (SEAL) CITY OF PEARLAND, TEXAS
CERTIFICATE)
Mayor
City Secretary
(b) Form of Registration Certificate of Comptroller of Public Accounts
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4133-2852-5381.1
COMPTROLLER'S REGISTRATION CERTIFICATE. REGISTER NO
I hereby certify that this Bond has been examined, certified as to validity, and approved
by the Attorney General of the State of Texas, and that this Bond has been registered by the
Comptroller of Public Accounts of the State of Texas.
WITNESS MY SIGNATURE AND SEAL this
Comptroller of Public Accounts
of the State of Texas
(SEAL)
(c) Form of Registrar's Authentication Certificate.
AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been delivered pursuant to the Bond Ordinance
described in the text of this Bond.
11
As Paying Agent/Registrar
By
Authorized Signature
Date of Authentication
(d) Form of Assignment.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns, and transfers unto
(Please print or type name, address, and zip code of Transferee)
(Please insert Social Security or Taxpayer Identification Number of Transferee)
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
attorney to transfer said Bond on the books kept for registration thereof, with full power of
substitution in the premises.
DATED.
i 1 Insert from Officer's Pricing Certificate.
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4133-2852-5381.1
Signature Guaranteed.
Registered Owner
NOTICE. The signature above must
correspond to the name of the registered owner
as shown on the face of this Bond in every
NOTICE. Signature must be guaranteed by a particular, without any alteration, enlargement
member firm of the New York Stock Exchange or change whatsoever
or a commercial bank or trust company
(e) The Initial Bond shall be in the form set forth in paragraphs (a), (b) and (d) of this
Section, except for the following alterations.
(i) immediately under the name of the Bond, the headings "INTEREST RATE" and
"MATURITY DATE" shall both be completed with the words "As Shown
Below" and the word"CUSIP"deleted,
(ii) in the first paragraph of the Bond, the words "on the maturity date specified
above" and "at the rate shown above" shall be deleted and the following shall be
inserted at the end of the first sentence " , with such principal to be paid in
installments on March 1 in each of the years and in the principal amounts
identified in the following schedule and with such installments bearing interest at
the per annum rates set forth in the following schedule:
[Information to be inserted from the Officer's Pricing Certificate]
(iii) the Initial Bond shall be numbered I-1
19 CUSIP Numbers. CUSIP Numbers may be printed on the Bonds, but errors or
omissions in the printing of such numbers shall have no effect on the validity of the Bonds.
20. Debt Service Fund, Tax Levy There is hereby established a separate fund of the
City to be known as the City of Pearland, Texas, Permanent Improvement 12 Debt Service
Fund (the "Debt Service Fund"), which shall be kept separate and apart from all other funds of
the City The proceeds from all taxes levied, assessed and collected for and on account of the
Bonds authorized by this Ordinance shall be deposited, as collected, in the Debt Service Fund.
While the Bonds or any part of the principal thereof or interest thereon remain outstanding and
unpaid, there is hereby levied and there shall be annually assessed and collected in due time,
form and manner, and at the same time as other City taxes are assessed, levied and collected, in
each year, a continuing direct annual ad valorem tax, within the limits prescribed by law, upon
all taxable property in the City, sufficient to pay the current interest on the Bonds as the same
becomes due and to provide and maintain a debt service fund of not less than two percent of the
principal amount of the Bonds or the amount required to pay each installment of principal of the
Bonds as the same matures, whichever is greater, full allowance being made for delinquencies
12 Insert from Officers Pricing Certificate.
- 14-
4133-2852-5381.1
and costs of collection, and said taxes are hereby irrevocably pledged to the payment of the
interest on and principal of the Bonds and to no other purpose.
To pay the debt service coming due on the Bonds prior to receipt of the taxes levied to
pay such debt service, there is hereby appropriated from current funds on hand, which are hereby
certified to be on hand and available for such purpose, an amount sufficient to pay such debt
service, and such amount shall be used for no other purpose.
21 Application of Chapter 1208, Government Code Chapter 1208, Government
Code, applies to the issuance of the Bonds and the pledge of the taxes granted by the City under
Section 20 of this Ordinance, and such pledge is therefore valid, effective and perfected. If
Texas law is amended at any time while the Bonds are outstanding an unpaid such that the
pledge of the taxes granted by the City under Section 20 of this Ordinance is to be subject to the
filing requirements of Chapter 9, Business & Commerce Code, then in order to preserve to the
registered owners of the Bonds the perfection of the security interest in said pledge, the City
agrees to take such measures as it determines are reasonable and necessary under Texas law to
comply with the applicable provisions of Chapter 9, Business & Commerce Code and enable a
filing to perfect the security interest in said pledge to occur
22. Further Proceedings. After the Initial Bond has been executed, it shall be the duty
of the Mayor and other appropriate officials and agents of the City to deliver the Initial Bond and
all pertinent records and proceedings to the Attorney General of the State of Texas, for
examination and approval. After the Initial Bond has been approved by the Attorney General, it
shall be delivered to the Comptroller for registration. Upon registration of the Initial Bond, the
Comptroller (or the Comptroller's bond clerk or an assistant bond clerk lawfully designated in
writing to act for the Comptroller) shall manually sign the Comptroller's Registration Certificate
prescribed herein and the seal of said Comptroller shall be impressed, or placed in facsimile,
thereon.
23 Sale, Bond Purchase Agreement. The Bonds shall be sold and delivered to the
Underwriter, who shall be designated in the Pricing Officer's Certificate, at the price set forth in
the Pricing Officer's Certificate and in accordance with the terms of the Bond Purchase Contract
which the Pricing Officer is hereby authorized and directed to execute on behalf of the City The
Pricing Officer and all other officers, agents and representatives of the City are hereby
authorized to do any and all things necessary or desirable to satisfy the conditions set out therein
and to provide for the issuance and delivery of the Bonds. The Pricing Officer is hereby
authorized and directed to execute the Bond Purchase Agreement on behalf of the City, and the
Mayor, City Manager, Interim City Manager, Deputy Director of Finance, Director of Finance or
Chief Financial Officer and all other officers, agents and representatives of the City are hereby
authorized to do any and all things necessary or desirable to satisfy the conditions set out therein
and to provide for the issuance and delivery of the Bonds In the event the Bond Purchase
Agreement shall not be executed by the one year anniversary of the date of this Ordinance (the
"Expiration Date"), the delegation to the Pricing Officer pursuant to this Ordinance shall cease to
be effective unless the City shall act to extend such delegation. Bonds sold pursuant to a Bond
Purchase Agreement or winning bid form executed on or before the Expiration Date may be
delivered after such date.
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4133-2852-5381.1
24 Federal Income Tax Exclusion.
The City intends that the interest on the Bonds shall be excludable from gross income of
the owners thereof for federal income tax purposes pursuant to Sections 103 and 141 through
150 of the Internal Revenue Code of 1986, as amended, (the "Code") and all applicable
temporary, proposed and final regulations (the "Regulations") and procedures promulgated
thereunder and applicable to the Bonds. For this purpose, the City covenants that it will monitor
and control the receipt, investment, expenditure and use of all gross proceeds of the Bonds
(including all property, the acquisition, construction or improvement of which is to be financed
directly or indirectly with the proceeds of the Bonds) and take or omit to take such other and
further actions as may be required by Sections 103 and 141 through 150 of the Code and the
Regulations to cause the interest on the Bonds to be and remain excludable from the gross
income, as defined in Section 61 of the Code, of the owners of the Bonds for federal income tax
purposes. Without limiting the generality of the foregoing, the City shall comply with each of
the following covenants.
(a) The City shall not use, permit the use of or omit to use Gross Proceeds or any
other amounts (or any property the acquisition, construction or improvement of which is to be
financed directly or indirectly with Gross Proceeds) in a manner which, if made or omitted,
respectively, would cause the interest on any Bond to become includable in the gross income, as
defined in Section 61 of the Code, of the owner thereof for federal income tax purposes.
Without limiting the generality of the foregoing, unless and until the City shall have received a
written opinion of counsel nationally recognized in the field of municipal bond law to the effect
that failure to comply with such covenant will not adversely affect the exemption from federal
income tax of the interest on any Bond,the City shall comply with each of the specific covenants
in this Section.
(b) Except as permitted by Section 141 of the Code and the regulations and rulings
thereunder,the City shall, at all times pnor to the last stated maturity of the Bonds,
(1) exclusively own, operate, and possess all property the acquisition,
construction, or improvement of which is to be financed directly or indirectly with Gross
Proceeds of such series of the Bonds (including property financed with Gross Proceeds of
the Refunded Bonds or notes or bonds refunded by the Refunded Bonds and not use or
permit the use of such Gross Proceeds or any property acquired, constructed, or improved
with such Gross Proceeds in any activity carried on by any person or entity other than a
state or local government,unless such use is solely as a member of the general public, or
(2) not directly or indirectly impose or accept any charge or other payment for
use of Gross Proceeds of such series of the Bonds or any property the acquisition,
construction or improvement of which is to be financed directly or indirectly with such
Gross Proceeds (including property financed with Gross Proceeds of the Refunded Bonds
or notes or bonds refunded by the Refunded Bonds other than taxes of general application
and interest earned on investments acquired with such Gross Proceeds pending
application for their intended purposes.
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4133-2852-5381.1
(c) Except to the extent permitted by Section 141 of the Code and the regulations and
rulings thereunder, the City shall not use Gross Proceeds of the Bonds to make or finance loans
to any person or entity other than a state or local government. For purposes of the foregoing
covenant, Gross Proceeds are considered to be "loaned" to a person or entity if (1)property
acquired, constructed or improved with Gross Proceeds (including property financed with Gross
Proceeds of the Refunded Bonds or notes or bonds refunded by the Refunded Bonds is sold or
leased to such person or entity in a transaction which creates a debt for federal income tax
purposes, (2) capacity in or service from such property is committed to such person or entity
under a take-or-pay, output, or similar contract or arrangement, or (3) indirect benefits, or
burdens and benefits of ownership, of such Gross Proceeds or such property are otherwise
transferred in a transaction which is the economic equivalent of a loan.
(d) Except to the extent permitted by Section 148 of the Code and the regulations and
rulings thereunder, the City shall not, at any time prior to the earlier of the final stated maturity
or final payment of the Refunded Bonds, directly or indirectly invest Gross Proceeds of such
Bonds in any Investment (or use such Gross Proceeds to replace money so invested), if as a
result of such investment the Yield of all Investments allocated to such Gross Proceeds whether
then held or previously disposed of, exceeds the Yield on the Refunded Bonds.
(e) Based on all of the facts and estimates now known or reasonably expected to be in
existence on the date the Bonds are delivered, the City reasonably expects that the proceeds of
the Bonds and the Refunded Bonds (to the extent any of such proceeds remain unexpended) will
not be used in a manner that would cause the Bonds or the Refunded Bonds or any portion
thereof to be"arbitrage bonds"within the meaning of Section 148 of the Code.
(f) At all times while the Bonds are outstanding, the City will identify and properly
account for all amounts constituting gross proceeds of the Bonds in accordance with the
Regulations. The City will monitor the yield on the investments of the proceeds of the Bonds
and, to the extent required by the Code and the Regulations, will restrict the yield on such
investments to a yield which is not materially higher than the yield on the Bonds. To the extent
necessary to prevent the Bonds from constituting "arbitrage bonds," the City will make such
payments as are necessary to cause the yield on all yield restricted nonpurpose investments
allocable to the Bonds to be less than the yield that is materially higher than the yield on the
Bonds.
(g) The City will not take any action or knowingly omit to take any action, if taken or
omitted, would cause the Bonds to be treated as "federally guaranteed" obligations for purposes
of Section 149(b) of the Code.
(h) The City represents that not more than fifty percent (50%) of the proceeds of any
new money portion of the Bonds or any new money issue refunded by, the Refunded Bonds was
invested in nonpurpose investments (as defined in Section 148(f)(b)(A) of the Code) having a
substantially guaranteed yield for four years or more within the meaning of
Section 149(g)(3)(A)(ii) of the Code, and the City reasonably expected at the time each issue of
the Refunded Bonds was issued that at least eighty-five percent (85%) of the spendable proceeds
of the Bonds or the Refunded Bonds would be used to carry out the governmental purpose of
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4133-2852-5381.1
such Bonds within the corresponding three-year period beginning on the respective dates of the
Bonds or the Refunded Bonds.
(i) The City will take all necessary steps to comply with the requirement that certain
amounts earned by the City on the investment of the gross proceeds of the Bonds, if any, be
rebated to the federal government. Specifically, the City will (i) maintain records regarding the
receipt, investment and expenditure of the gross proceeds of the Bonds as may be required to
calculate such excess arbitrage profits separately from records of amounts on deposit in the funds
and accounts of the City allocable to other obligations of the City or moneys which do not
represent gross proceeds of any obligations of the City and retain such records for at least six
years after the day on which the last outstanding Bond is discharged, (ii) account for all gross
proceeds under a reasonable, consistently applied method of accounting, not employed as an
artifice or device to avoid, in whole or in part, the requirements of Section 148 of the Code,
including any specified method of accounting required by applicable Regulations to be used for
all or a portion of the gross proceeds, (iii) calculate, at such times as are required by applicable
Regulations, the amount of excess arbitrage profits, if any, earned from the investment of the
gross proceeds of the Bonds and (iv) timely pay, as required by applicable Regulations, all
amounts required to be rebated to the federal government. In addition, the City will exercise
reasonable diligence to assure that no errors are made in the calculations required by the
preceding sentence and, if such an error is made, to discover and promptly correct such error
within a reasonable amount of time thereafter, including payment to the federal government of
any delinquent amounts owed to it, including interest thereon and penalty
(j) The City will not indirectly pay any amount otherwise payable to the federal
government pursuant to the foregoing requirements to any person other than the federal
government by entering into any investment arrangement with respect to the gross proceeds of
the Bonds that might result in a reduction in the amount required to be paid to the federal
government because such arrangement results in smaller profit or a larger loss than would have
resulted if such arrangement had been at arm's length and had the yield on the issue not been
relevant to either party
(k) The City will timely file or cause to be filed with the Secretary of the Treasury of
the United States the information required by Section 149(e) of the Code with respect to the
Bonds on such form and in such place as the Secretary may prescribe
(1) The City will not issue or use the Bonds as part of an "abusive arbitrage device"
(as defined in Section 1 148 10(a) of the Regulations) Without limiting the foregoing, the
Bonds are not and will not be a part of a transaction or series of transactions that attempts to
circumvent the provisions of Section 148 of the Code and the Regulations, by (i) enabling the
City to exploit the difference between tax exempt and taxable interest rates to gain a material
financial advantage, or (ii) increasing the burden on the market for tax-exempt obligations.
(m) Proper officers of the City charged with the responsibility for issuing the Bonds
are hereby directed to make, execute and deliver certifications as to facts, estimates or
circumstances in existence as of the Issue Date and stating whether there are facts, estimates or
circumstances that would materially change the City's expectations. On or after the Issue Date,
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4133-2852-5381.1
the City will take such actions as are necessary and appropriate to assure the continuous accuracy
of the representations contained in such certificates.
(n) The covenants and representations made or required by this Section are for the
benefit of the Bond holders and any subsequent Bond holder, and may be relied upon by the
Bond holder and any subsequent Bond holder and bond counsel to the City
In complying with the foregoing covenants, the City may rely upon an unqualified
opinion issued to the City by nationally recognized bond counsel that any action by the City or
reliance upon any interpretation of the Code or Regulations contained in such opinion will not
cause interest on the Bonds to be includable in gross income for federal income tax purposes
under existing law
Notwithstanding any other provision of this Ordinance, the City's representations and
obligations under the covenants and provisions of this Section 7.5 shall survive the defeasance
and discharge of the Bonds for as long as such matters are relevant to the exclusion of interest on
the Bonds from the gross income of the owners for federal income tax purposes.
25 Use of Proceeds. Proceeds from the sale of the Bonds shall, promptly upon
receipt by the City,be applied as follows.
(a) Accrued interest in the amount of $ 13 and, if necessary, net premium on the
Bonds in the amount of$ 14 , shall be deposited into the Debt Service Fund.
(b) Premium in the amount of$ 15 shall be used to pay the underwriter's discount.
(c) Net premium in the amount of$ 16 shall be used to pay the costs of issuance.
(d) The remaining proceeds from the sale of the Bonds, together with other available
funds of the City (in the amount of $ 17 ), shall be applied to establish an escrow fund to
refund the Refunded Bonds or a deposit with the paying agent for the Refunded Bonds, as more
fully provided in Section 26 below, and, to the extent not otherwise provided for, to pay all
expenses arising in connection with the issuance of the Bonds, the establishment of such escrow
fund and the refunding of the Refunded Bonds.
(e) Any proceeds of the Bonds remaining after makuig all such deposits and
payments shall be deposited into the Debt Service Fund.
26. Escrow Agreement/Deposit with Paying Agent for Refunding Bonds. If
Refunding Bonds are issued, the discharge and defeasance of the Refunded Bonds may be
effectuated pursuant to the terms and provisions of an Escrow Agreement or other such deposit
agreement to be entered into by and between the City and the Escrow Agent or pursuant to a
deposit of funds with the paying agent for the Refunded Bonds The terms and provisions of an
13 Insert from Officer's Pricing Certificate.
14 Insert from Officer's Pricing Certificate.
15 Insert from Officer's Pricing Certificate.
16 Insert from Officer's Pricing Certificate.
17 Insert from Officer's Pricing Certificate.
- 19 -
4133-2852-5381.1
Escrow Agreement or other deposit agreement, if needed, are hereby approved, subject to such
insertions, additions and modifications as shall be necessary to carry out the terms of this
Ordinance and the Pricing Certificate. The mathematical accuracy of the terms of the refunding
shall be certified to by verification agent or by a certificate of sufficiency of deposit executed by
the City's financial advisor or the paying agent for the Refunded Bonds The Mayor is hereby
authorized to execute and deliver such Escrow Agreement or other such deposit agreement on
behalf of the City in multiple counterparts and the City Secretary or the Assistant City Secretary
is hereby authorized to attest thereto
27 Redemption of Refunded Bonds. If Refunding Bonds are issued, the City has
irrevocably exercised its option to call the bonds of the City for redemption prior to maturity on
the dates and at the prices shown on Exhibit C to the Officer's Pricing Certificate, and authorized
and directed notice of such redemption to be given in accordance with the ordinances authorizing
the issuance of such bonds.
28 Purchase of Escrowed Securities. If an Escrow Agreement is utilized, to assure
the purchase of the Escrowed Securities referred to in the Escrow Agreement, if required, the
Pricing Officer is hereby authorized to subscribe for, agree to purchase, and purchase obligations
which are authorized investments for escrow accounts pursuant to Section 1207 062, Texas
Government Code, in such amounts and maturities and bearing interest at such rates as may be
provided for in the Report, and to execute any and all subscriptions, purchase agreements,
commitments, letters of authorization and other documents necessary to effectuate the foregoing,
and any actions heretofore taken for such purpose are hereby ratified and approved.
29 Continuing Disclosure Undertaking. (a) Annual Reports. The City will provide
certain updated financial information and operating data to the MSRB annually in an electronic
format as prescribed by the MSRB and available via the Electronic Municipal Market Access
("EMMA") system at www.emma.msrb.org. Unless provided for in the Officer's Pricing
Certificate, the information to be updated includes all quantitative financial information and
operating data with respect to the City of the general type included in the final Official Statement
authorized by Section 31 of this Ordinance under Tables 1-3 and 5-13 and in APPENDIX`B "
The City will update and provide this information within six months after the end of each fiscal
year
If the City changes its fiscal year, it will submit a notice of such change to the MSRB,
and the date of the new fiscal year end prior to the next date by which the City otherwise would
be required to provide financial information and operating data pursuant to this Section.
The financial information and operating data to be provided may be set forth in full in
one or more documents or may be included by specific reference to any document available to
the public on the MSRB's Internet Web site or filed with the SEC, as permitted by the SEC Rule
The updated information will include audited financial statements, if the City commissions an
audit and it is completed by the required time. If audited financial statements are not available
by the required time, the City will provide unaudited financial statements by the required time
and audited financial statements when and if such audited statements become available. Any
such financial statements will be prepared in accordance with the accounting principles described
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4133-2852-5381.1
in APPENDIX B or such other accounting principles as the City may require to employ from
time to time pursuant to State law or regulation.
(b) Material Event Notices. The City shall notify the MSRB in an electronic format
prescribed by the MSRB, in a timely manner (not in excess of ten (10) days after the occurrence
of the event), of any of the following events with respect to the Bonds.
(i) Principal and interest payment delinquencies,
(ii) Non-payment related defaults, if material,
(iii) Unscheduled draws on debt service reserves reflecting financial difficulties,
(iv) Unscheduled draws on credit enhancements reflecting financial difficulties,
(v) Substitution of credit or liquidity providers or their failure to perform,
(vi) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed
or final determinations of taxability, Notices of Proposed Issue (IRS Form
5701-TEB) or other material notices or determinations with respect to the tax
status of the Bonds, or other material events affecting the tax status of the Bonds,
(vii) \ Modifications to rights of holders of the Bonds, if material,
(viii) Bond calls, if material, and tender offers,
(ix) Defeasances,
(x) Release, substitution, or sale of property securing repayment of the Bonds, if
material,
(xi) Rating changes,
(xii) Bankruptcy, insolvency, receivership or similar event of the City;
(xiii) The consummation of a merger, consolidation, or acquisition involving the City
or the sale of all or substantially all of the assets of the City, other than in the
ordinary course of business, the entry into a definitive agreement to undertake
such an action or the termination of a definitive agreement relating to any such
actions, other than pursuant to its terms, if material,
(xiv) Appointment of a successor Paying Agent/Registrar or change in the name of the
Paying Agent/Registrar, if material,
(xv) Incurrence of a Financial Obligation of the City, if material, or agreement to
covenants, events of default, remedies, priority rights, or other similar terms of a
Financial Obligation of the City, any of which affect security holders, if material,
and
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4133-2852-5381.1
1
(xvi) Default, event of acceleration, termination event, modification of terms, or other
similar events under the terms of a Financial Obligation of the City, any of which
reflect financial difficulties.
For the purposes, any event described in the immediate preceding paragraph (xii) is
considered to occur when any of the following occur the appointment of a receiver, fiscal agent
or similar officer for the City in a proceeding Under States Bankruptcy Code or any other
proceeding under state or federal law in which a court or governmental authority has assumed
jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has
been assumed by leaving the existing governing body and officials or officers in possession but
subject to the supervision and orders of a court or governmental authority, or the entry of order
confirming a plan of reorganization, arrangement or liquidation by a court or governmental
authority having supervision or jurisdiction over substantially all of the assets or business of the
City
The City intends the words used in the immediately preceding paragraphs (xv) and (xvi)
and the definition of Financial Obligation in this Section to have the same meanings as when
they are used in the Rule, as evidenced by SEC Release No 34-83885, dated August 20, 2018.
The Pricing Officer is authorized and directed to establish and implement written
procedures to ensure compliance with the reporting requirements imposed by this Section. Such
procedures may be modified and amended by the Pricing Officer from time to time to the extent
the modification or amendment of such procedures are deemed necessary, useful or appropriate.
The City shall notify the MSRB, in a timely manner, of any failure by the City to provide
financial information or operating data in accordance this Section by the time required by such
Section.
(c) Limitations, Disclaimers, and Amendments. The City shall be obligated to
observe and perform the covenants specified in this Section for so long as, but only for so long
as, the City remains an "obligated person" with respect to the Bonds within the meaning of the
Rule, except that the City in any event will give notice of any deposit made in accordance with
Texas law that causes Bonds no longer to be outstanding.
The provisions of this Section are for the sole benefit of the holders and the beneficial
owners of the Bonds, and nothing in this Section, express or implied, shall give any benefit or
any legal or equitable right, remedy, or claim hereunder to any other person. The City
undertakes to provide only the financial information, operating data, financial statements, and
notices which it has expressly agreed to provide pursuant to this Section and does not hereby
undertake to provide any other information that may be relevant or material to a complete
presentation of the City's financial results, condition, or prospects or hereby undertake to update
any information provided in accordance with this Section or otherwise, except as expressly
provided herein. The City does not make any representation or warranty concerning such
information or its usefulness to a decision to invest in or sell Bonds at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER
OR BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR
- 22 -
4133-2852-5381.1
TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY
THE CITY, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY
COVENANT SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND REMEDY OF
ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH
BREACH SHALL BE UNLIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC
PERFORMANCE.
No default by the City in observing or performing its obligations under this Section shall
comprise a breach of or default under this Ordinance for purposes of any other provision of this
Ordinance.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the
duties of the City under federal and state securities laws.
The provisions of this Section may be amended by the City from time to time to adapt to
changed circumstances that arise from a change in legal requirements, a change in law, or a
change in the identity, nature, or status or type of principal payment of the City, if (1)the
agreement, as so amended, would have permitted an underwriter to purchase or sell Bonds in the
initial primary offering in compliance with the Rule, taking into account any amendments or
interpretations of the Rule to the date of such amendment, as well as such changed
circumstances, and (2) either(a) the holders of a majority in aggregate amount of the outstanding
Bonds consent to such amendment or (b) a person unaffiliated with the City (such as nationally
recognized bond counsel) determines that the amendment will not materially impair the interests
of the holders and beneficial owners of the Bonds. The City may also amend or repeal the
provisions'of this continuing disclosure agreement if the SEC amends or repeals the applicable
provisions of the Rule or a court of final jurisdiction enters judgment that such provisions of the
Rule are invalid, but only if and to the extent that the provisions of this sentence would not
prevent an underwriter from lawfully purchasing or selling Bonds in the primary offering of the
Bonds. If any such amendment is made, the City will include in its next annual update an
explanation in narrative form of the reasons for the change and its impact on the type of
operating data or financial information being provided.
30. Related Matters. To satisfy in a timely manner all of the City's obligations under
this Ordinance, the Bond Purchase Agreement, and the Escrow Agreement, the Mayor or Mayor
Pro Tem, the City Secretary or an Assistant City Secretary, the City Manager, Interim City
Manager, the Director of Finance, the Deputy Director of Finance or the Chief Financial Officer
and all other appropriate officers and agents of the City are hereby authorized and directed to
take all other actions that are reasonably necessary to provide for the refunding of the Refunded
Bonds, including, without limitation, executing and delivering on behalf of the City all
certificates, consents, receipts, requests, and other documents as may be reasonably necessary to
satisfy the City's obligations under the Escrow Agreement, the Bond Purchase Agreement, and
this Ordinance and to direct the application of funds of the City consistent with the provisions of
the Escrow Agreement or other deposit agreement and this Ordinance.
31 Power to Revise Form of Documents. Notwithstanding any other provision of
this the Pricing Officer is hereby authorized to make or approve such revisions, additions,
deletions, and variations to this Ordinance and in the form of the documents attached hereto as
- 23 -
4133-2852-5381 1
exhibits as, in the judgment of the Pricing Officer, and in the opinion of Bond Counsel to the
City, may be necessary or convenient to carry out or assist in carrying out the purposes of this
Ordinance, the Preliminary Official Statement, the final Official Statement, or as may be
required for approval of the Bonds by the Attorney General of Texas, provided, however, that
any changes to such documents resulting in substantive amendments to the terms and conditions
of the Bonds or such documents shall be subject to the prior approval of the Board.
32. Amendments. The City may amend this Ordinance without the consent of or
notice to any Owner in any manner not detrimental to the interests of the Owners, including the
curing of any ambiguity, inconsistency, or formal defect or omission therein. In addition, the
City may with the written consent of the holders of a majority of the aggregate principal amount
of the Bonds then outstanding affected thereby, amend, add to, or rescind any of the provisions
of the Ordinance; except that, without the consent of the Owners of the Bonds affected, no such
amendment, addition or rescission may (i) make any change in the maturity of any of the
outstanding Bonds, (ii)reduce the rate of interest borne by any of the outstanding Bonds,
(iii)reduce the amount of the principal of or redemption premium, if any, payable on any
outstanding Bonds, (iv) modify the terms of payment of principal or of interest or redemption
premium on outstanding Bonds or any of them or impose any condition with respect to such
payment; or (v) change the minimum percentage of the principal amount of the Bonds necessary
for consent to such amendment.
33 Official Statement. The City Council hereby approves the form and content of the
Preliminary Official Statement prepared for the initial offering and sale of the Bonds and hereby
authorizes the preparation of a final Official Statement reflecting the terms of the Bond Purchase
Agreement and other relevant matters. The use of such Official Statement in the reoffering of
the Bonds by the Underwriter is hereby approved and authorized.
34 Registrar The form of agreement setting forth the duties of the Registrar is
hereby approved, and the appropriate officials of the City are hereby authorized to execute such
agreement for and on behalf of the City
35 No Personal Liability No recourse shall be had for payment of the principal of or
interest on any Bonds or for any claim based thereon, or on this Ordinance, against any official
or employee of the City or any person executing any Bonds.
36. Open Meeting. The meeting at which this Ordinance is adopted was open to the
public and public notice of the time, place and purpose of said meeting was given, all as required
by the Texas Open Meetings Act; and such notice as given is hereby authorized, approved,
adopted and ratified.
-24 -
4133-2852-5381 1
First Reading on the 6th day of March 2023
PASSED AND APPROVED on the Second Reading the 27th day of March 2023
,
,
-25 -
4133-2852-5381.1
EXHIBIT A
ALL THE CITY'S OUTSTANDING GENERAL OBLIGATION DEBT
Permanent Improvement Bonds, Series 2013
Certificates of Obligation, Series 2013
Permanent Improvement and Refunding Bonds, Series 2014
Certificates of Obligation, Series 2014
Permanent Improvement Refunding Bonds, Series 2015
Permanent Improvement Bonds, Series 2015
Certificates of Obligation, Series 2015
Permanent Improvement Refunding Bonds, Series 2015-A
Certificates of Obligation, Series 2016
Permanent Improvement and Refunding Bonds, Series 2016A
Permanent Improvement Refunding Bonds, Series 2016B
Permanent Improvement and Refunding Bonds, Series 2017
Certificates of Obligation, Series 2017
Permanent Improvement Bonds, Series 2018
Certificates of Obligation, Series 2018
Permanent Improvement and Refunding Bonds, Series 2019
Certificates of Obligation, Series 2019A
Certificates of Obligation, Series 2019B
Permanent Improvement Bonds, Series 2020
Certificates of Obligation, Series 2020A
Certificates of Obligation, Series 2020B
Permanent Improvement Bonds, Series 2021
Certificates of Obligation, Series 2021A
Certificates of Obligation, Series 2021B
Permanent Improvement Refunding Bonds, Series 2022
Certificates of Obligation, Series 2022A
Certificates of Obligation, Series 2022B
Certificates of Obligation, Series 2022C
Permanent Improvement Bonds, Series 2022
- 26 -
4133-2852-5381 1
GENERAL CERTIFICATE
STATE OF TEXAS §
COUNTIES OF BRAZORIA, § `
FORT BEND AND HARRIS §
CITY OF PEARLAND §
We, the undersigned officers of the City of Pearland, Texas (the "City"), do hereby make
and execute this certificate for the benefit of the Attorney General of the State of Texas and all
other persons interested in the $ CITY OF PEARLAND, TEXAS PERMANENT
IMPROVEMENT REFUNDING BONDS, SERIES 2023, dated , 2023 (the
"Bonds"), now in the process of issuance, as follows.
(1) The City is a home rule municipality operating under its own charter,which has not
been amended,repealed, changed or altered since the approval by the Attorney General of the State
of Texas of its City of Pearland, Texas, Permanent Improvement Bonds, Series 2022, which were
the last obligations issued by or on behalf of the City
(2) The following individuals were the duly elected and qualified Mayor and City
Council of the City holding the offices opposite their names.
Kevin Cole Mayor
Tony Carbone Mayor Pro-Tern
Joseph Koza Councilmember
Alex Kamkar Councilmember
Adrian Hernandez Councilmember
Layni Cade Councilmember
Jeffrey Barry Councilmember
Woody Owens Councilmember
(3) Frances M. Aguilar is the duly appointed and qualified City Secretary of the City
(4) Attached to this certificate as Exhibit A is a true, full and correct debt service
schedule for all of the City's outstanding tax-supported debt,including the Bonds.The total amount
of all outstanding bonded indebtedness of the City payable from ad valorem taxes is
$ , which includes the Bonds and excludes the Refunded Bonds.
(5) The 2022 certified taxable valuation of the City is $9,510,163,308.
(6) None of the bonds being refunded by the Bonds (the"Refunded Bonds")have been
held in or purchased for the account of any of the interest and sinking funds created and maintained
for the payment and security of the Refunded Bonds,and none of the Refunded Bonds are currently
owned by and have ever been purchased or held for any account or fund of the City
(7) With respect to the contracts executed in connection with the authorization and
issuance of the Bonds, all disclosure filings and acknowledgments required by Section 2252.908,
Texas Government Code, and the rules of the Texas Ethics Commission related to said provision,
have been made.
1
4146-7872-6470.1
SIGNED AND SEALED this March 91 , 2023
CITY OF PEARLAND, TEXAS
fu-jimuiv
m:jtve___
City Secretary, City o _earland, Texas 'r, City of Pearland, Texas
(CITY SEAL) ��� �•�/1 -
S-1
4146-7872-6470.1
SIGNATURE IDENTIFICATION AND
NO-LITIGATION CERTIFICATE
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA, FORT BEND AND HARRIS §
CITY OF PEARLAND §
We, the undersigned officers of the City of Pearland, Texas (the "City"), certify that we
officially signed, by our manual or facsimile signatures, on behalf of the City, the following
described bonds, to wit:
CITY OF PEARLAND, TEXAS PERMANENT IMPROVEMENT REFUNDING
BONDS, SERIES 2023, dated _, 2023 and aggregating $ (the
"Bonds").
That the Bonds have been duly and officially executed by the undersigned with their
manual or facsimile signatures in the same manner appearing hereon, and the undersigned hereby
adopt and ratify their respective signatures in the manner appearing on each of the Bonds,whether
in manual or facsimile form, as the case may be, as their own signatures.
That on the date of such signing and on the date hereof, we were and are the duly chosen,
qualified and acting officers authorized to execute the Bonds, and holding the official titles set
forth below opposite such signatures.
We further certify that no litigation is pending or,to our knowledge,threatened in any court
in any way affecting the existence or boundaries of the City or the titles of its officers to their
respective positions or their authority to act on the City's behalf or to restrain or enjoin the issuance
or delivery of the Bonds, or the levy, collection or application of the ad valorem taxes or revenues
pledged or to be pledged to pay the principal of and interest on the Bonds, or the pledge thereof,
or in any way contesting or affecting the validity of the Bonds,the ordinance dated
2023,authorizing the issuance, sale and delivery of the Bonds (the "Ordinance"), or contesting the
powers of the City or the authorization of the Bonds or the Ordinance, or contesting in any way
the accuracy, completeness or fairness of the Official Statement.
We further certify that the seal that has been impressed, or placed in facsimile, upon each
of the Bonds is the legally adopted, proper and only official seal of the City, such official seal
being impressed upon this certificate.
We further certify that the information and data contained in the General Certificate dated
, 2023 remain true and correct as of this date.
1
4152-1520-4166.1
WITNESS OUR HANDS AND THE SEAL OF THE CITY this(" )day of 014K.;k
2023
SIGNATURES TITLE OF OFFICE
Mayor,
.2('' '' -/ L----
City of Pearland, Texas
"rtuivw )0,A ii 411 ,a
City Secretary,
""" City of Pearland, Texas
.�,`Qc)RLANj',
O - ,
(CITY SEAL) =v ```� U'
OA ..t.-
Before me, on this ca'�'liarkonally appeared the foregoing individuals, known to me to be
the persons whose names were subscribed in my presence to the foregoing instrument.
Given under my hand and seal of office this 14OACA C 2023
tary lic 4oLi
c
0414C-Cadifs--
Typed or Printed Name.
Tenn is r- '\,c,tn CackinL5
„�“:4 cNiFinT ea cADMUS MyCommission Expires.
4P 9'
::° `�'•• Notary Public,State of Taxas p
_+ - *- My Commission Expires
___ December 17,2024 _ l
.°���°F��°` NOTARY ID 1168200-6ateinthVb I 1 I C� U/-'11�"-
(Notary Seal)
2
4152-1520-4166.1
` 4On,t (7_2 2023
The Attorney General of Texas The Comptroller of Public Accounts
Public Finance Section Public Finance Division
William P Clements Building,7th Floor 111 East 17th Street
300 West 15th Street Austin,Texas 78701
Austin,Texas 78701
Re: City of Pearland, Texas Permanent Improvement Refunding Bonds,
Series 2023 (the"Bonds")
Ladies and Gentlemen.
The captioned Bonds are being sent to the Office of the Attorney General, and it is
requested that such office examine and approve the Bonds in accordance with law After such
approval, it is requested that the Attorney General deliver the Bonds to the Comptroller of Public
Accounts for registration.
Enclosed with the Bonds is a signed but undated copy of the SIGNATURE
IDENTIFICATION AND NO-LITIGATION CERTIFICATE (the "Certificate") relating to the
Bonds. The Attorney General is hereby authorized and directed to date the Certificate concurrently
with the date of approval of the Bonds. If any litigation or contest should develop pertaining to
the Bonds or any other matters covered by said Certificate,the undersigned will notify the Attorney
General thereof immediately by telephone. With this assurance the Attorney General can rely on
the absence of any such litigation or contest, and on the veracity and currency of,said Certificate,
at the time the Attorney General approves the Bonds unless the Attorney General is notified
otherwise as aforesaid.
The Comptroller is hereby requested to register the Bonds as required by law and the
proceedings authorizing the Bonds. After such registration, the Comptroller is hereby authorized
and directed to deliver the Bonds, together with three copies of each of the Attorney General's
Approving Opinion and Comptroller's Certificate for the Bonds, to Tanya Fischer, Orrick,
Herrington& Sutcliffe LLP, Houston,Texas 77002.
1
4130-5797-5366.1
44198-17
•
CITY OF PEARLAND,TEXAS
By. !'
ayor
2
4130-5797-5366.1
44198-17
PAYING AGENT/REGISTRAR AGREEMENT
THIS PAYING AGENT/REGISTRAR AGREEMENT dated as of _, 2023
(together with any amendments or supplements hereto, the "Agreement") is entered into by and
between the CITY OF PEARLAND, TEXAS (the "Issuer"), and , as paying
agent/registrar(together with any successor in such capacity, the "Bank")
WTTNES SETH.
WHEREAS, the Issuer has duly authorized and provided for the issuance of its City of
Pearland, Texas Permanent Improvement Refunding Bonds, Series 2023 (the "Bonds"),
WHEREAS, all things necessary to make the Bonds (as defined herein) the valid Bonds of
the Issuer, in accordance with their terms,will be done upon the issuance and delivery thereof;
WHEREAS, the Issuer and the Bank wish to provide the terms under which the Bank will
act as Paying Agent to pay the principal of, redemption premium, if any, and interest on the Bonds,
in accordance with the terms thereof, and under which the Bank will act as Registrar for the Bonds,
and
WHEREAS, the Issuer and the Bank have duly authorized the execution and delivery of
this Agreement; and all things necessary to make this Agreement the valid agreement of the parties,
in accordance with its terms,have been done.
NOW, THEREFORE, it is mutually agreed as follows
ARTICLE ONE
APPOINTMENT OF BANK AS
PAYING AGENT AND REGISTRAR
Section 1 01 Appointment.
The Issuer hereby appoints the Bank to act as Paying Agent with respect to the Bonds, to
pay to the Registered Owners of the Bonds, in accordance with the terms and provisions of this
Agreement and the Ordinance, the principal of, redemption premium, if any, and interest on all or
any of the Bonds.
The Issuer hereby appoints the Bank as Registrar with respect to the Bonds.
The Bank hereby accepts its appointment, and agrees to act as Paying Agent and Registrar
with respect to the Bonds.
Section 1 02. Compensation.
As compensation for the Bank's Services as Paying Agent and Registrar, the Issuer hereby
agrees to pay the Bank the fees set forth in the Bank's fee schedule attached as Exhibit A hereto.
The Bank reserves the right to amend the fee schedule at any time, provided the Bank shall have
1
4163-5579-2710.1
furnished the Issuer with a written copy of such amended fee schedule at least 60 days prior to the
date that the new fees are to become effective.
In consideration of the deposits of funds required to be made with the Bank by the Issuer
pursuant to the provisions of the Ordinance (hereinafter defined), the Bank agrees to abide by
and accept the terms hereof and of the Ordinance relating to the duties of the Paying
Agent/Registrar
ARTICLE TWO
DEFINITIONS
Section 2.01 Definitions.
For all purposes of this Agreement, except as otherwise expressly provided or unless the
context otherwise requires.
"Bank" means
"Bonds" means all of the "City of Pearland, Texas Permanent Improvement Refunding
Bonds, Series 2023" authorized by the Ordinance.
"Financial Advisor" means BOK Financial Securities, Inc. and it's successors.
"Issuer" means the City of Pearland, Texas.
"Ordinance" means the ordinance authorizing issuance of the Bonds of the Issuer approved
by its City Council on March 27, 2023
"Paying Agent" means the Bank when it is performing the function of paying agent.
"Person" means any individual, corporation, partnership, joint venture, associations, joint
stock company, trust, unincorporated organization or government or any agency or political
subdivision of a government or any entity whatsoever
"Registrar" means the Bank when it is performing the function of registrar
"Registered Owner" means the Person in whose name any Obligation is registered in the
books of registration maintained by the Bank under this Agreement.
All other capitalized terms shall have the meanings assigned to them in the Ordinance.
ARTICLE THREE
DUTIES OF THE BANK
Section 3 01 Initial Delivery of the Bonds.
2
4163-5579-2710.1
The Bonds will be initially registered and delivered by the Bank to the purchasers
designated by the Issuer as set forth in the Ordinance. If a purchaser delivers a written request to
the Bank not later than five business days prior to the date of initial delivery, the Bank will, on the
date of initial delivery, exchange the Bonds initially delivered for Bonds of authorized
denominations, registered in accordance with the instructions in such request and the appropriate
Ordinance.
Section 3 02. Duties of Paying Agent.
As Paying Agent, the Bank shall, provided adequate funds have been provided to it for such
purpose by or on behalf of the Issuer, timely pay on behalf of the Issuer the principal of and interest
on each Obligation in accordance with the provisions of the appropriate Ordinance.
If the Bonds are to be Depository Trust Company (DTC) eligible, the Bank will comply
with all eligibility requirements as outlined and agreed upon in the eligibility questionnaire.
Section 3 03 Duties of Registrar.
The Bank shall provide for the proper registration of the Bonds and the exchange,
replacement and registration of transfer of the Bonds in accordance with the provisions of the
Order The Bank will maintain the books of registration in accordance with transfer agent
regulations promulgated by the Securities and Exchange Commission and the applicable provisions
of the Uniform Commercial Code.
Section 3 04 Unauthenticated Bonds.
At any time when the Bonds are not subject to a book-entry-only system of registration and
transfer, the Issuer shall provide an adequate inventory of unauthenticated Bonds to facilitate
transfers. The Bank covenants that it will maintain such unauthenticated Bonds in safekeeping and
will use reasonable care in maintaining such Bonds in safekeeping, which shall be not less than the
care it maintains for debt securities of other government entities or corporations for which it serves
as registrar, or which it maintains for its own bonds.
Section 3 05 Reports.
Upon request of the Issuer, the Bank will provide the Issuer reports which will describe in
reasonable detail all transactions pertaining to the Bonds and the books of registration for the
period of time specified by the Issuer The Issuer may also inspect and make copies of the
information in the books of registration and such other documents related to the Bonds and in the
Bank's possession at any time the Bank is customarily open for business, provided that reasonable
time is allowed the Bank to provide an up-to-date listing or to convert the information into written
form.
The Bank will not release or disclose the content of the books of registration to any person
other than to, or at the written request of, an authorized officer or employee of the Issuer, except
upon receipt of a subpoena, court order or as otherwise required by law Upon receipt of a
subpoena, court order or other lawful request, the Bank will notify the Issuer immediately so that
the Issuer may contest the subpoena,court order or other request if it so chooses.
3
4163-5579-2710.1
Section 3 06 Canceled Bonds.
All Bonds surrendered for payment, redemption, transfer, exchange or replacement, if
surrendered to the Bank, shall be promptly canceled by it and, if surrendered to the Issuer, shall be
delivered to the Bank and, if not already canceled, shall be promptly canceled by the Bank. The
Issuer may at any time deliver to the Bank for cancellation any Bonds previously authenticated
and delivered which the Issuer may have acquired in any manner whatsoever, and all Bonds so
delivered shall be promptly canceled by the Bank. All canceled Bonds held by the Bank shall be
destroyed and evidence of such destruction shall be furnished to the Issuer
Section 3 07 Reliance on Documents, Etc.
(a) The Bank may conclusively rely, as to the truth of the statements and correctness of the
opinions expressed therein, on certificates or opinions furnished to the Bank by the Issuer
(b) The Bank shall not be liable to the Issuer for actions taken under this Agreement as
long as it acts in good faith and exercises due diligence, reasonableness and care, as prescribed by
law, with regard to its duties hereunder
(c) This Agreement is not intended to require the Bank to expend its own funds for
performance of any of its duties hereunder
(d) The Bank may exercise any of the powers hereunder and perform any duties hereunder
either directly or by or through agents or attorneys.
(e) The Bank may rely and shall be protected by the Issuer against any claim by the Issuer
or any other Person in acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond, note, security, or other
paper or document believed by it to be genuine and to have been signed or presented by the proper
party or parties. Without limiting the generality of the foregoing statement, the Bank need not
examine the ownership of any Bond, but is protected in acting upon receipt of a Bond containing
an endorsement or instruction of transfer or power of transfer which appears on its face to be
signed by the holder or an agent of the holder The Bank shall not be bound to make any
investigation into the acts or matters stated in a resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, note, security or other paper or
document supplied by Issuer
(f) The Bank may consult with legal counsel, and the written advice of such counsel or any
opinion shall be full and complete authorization and protection with respect to any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon, provided that any such
written advice or opinion is supplied to the Issuer by the Bank.
(g) To the extent permitted by law, the Bank shall not be liable for any loss or damage,
including reasonable counsel fees and expenses, resulting from its actions or omissions to act
hereunder, except for any loss or damage arising out of its own negligence or willful misconduct.
IN NO EVENT SHALL THE BANK BE LIABLE FOR SPECIAL, INDIRECT OR
CONSEQUENTIAL LOSS OR DAMAGE OF ANY KIND WHATSOEVER (INCLUDING BUT
NOT LIMITED TO LOST PROFITS), EVEN IF THE BANK HAS BEEN ADVISED OF THE
4
4163-5579-2710.1
LIKELIHOOD OF SUCH LOSS OR DAMAGE AND REGARDLESS OF THE FORM OF
ACTION
Section 3 08. Money Held by Bank.
Money held by the Bank hereunder shall be held in trust for the benefit of the Registered
Owners of the Bonds.
The Bank shall be under no obligation to pay interest on any money received by it
hereunder
All money deposited with the Bank hereunder shall be secured in the manner and to the
fullest extent required by law for the security of funds of the Issuer
Any money deposited with the Bank for the payment of the principal of or interest on any
Bonds and remaining unclaimed by the Registered Owner after the expiration of three years from
the date such funds have become due and payable shall,be reported and disposed of by the Bank in
accordance with the provisions of Texas law including, to the extent applicable, Title 6 of the
Texas Property Code, as amended. To the extent such provisions of the Property Code do not apply
to the funds, such funds shall be paid by the Bank to the Issuer upon receipt of a written request
therefor from the Issuer The Bank shall have no liability to the Registered Owners of the Bonds by
virtue of actions taken in compliance with the foregoing provision.
A fiduciary account shall at all times be kept and maintained by the Bank for the receipt,
safekeeping and disbursement of moneys received from the Issuer hereunder for the payment of the
Bonds, and money deposited to the credit of such account until paid to the Holders of the Bonds
shall be continuously collateralized by securities or obligations which qualify and are eligible under
the laws of the State of Texas, including under Chapter 2256, Texas Government Code, to secure
and be pledged as collateral for fiduciary accounts to the extent such money is not insured by the
Federal Deposit Insurance Corporation. Payments made from such fiduciary account shall be made
by check drawn on such fiduciary account unless the owner of such Bonds shall, at its own expense
or risk, request such other medium of payment.
Section 3 09 Indemnification.
To the extent permitted by law the Issuer agrees to indemnify the Bank (including its
directors, officers and employees) for, and hold it harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part arising out of or in connection with its
acceptance or administration of its duties hereunder, including the reasonable cost and reasonable
expense (including its counsel fees) of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties under this
Agreement. The foregoing indemnities in this paragraph shall survive the resignation or removal of
the Paying Agent/Registrar and the termination of this Agreement.
5
4163-5579-2710.1
ARTICLE FOUR
MISCELLANEOUS PROVISIONS
Section 4 01 May Own Bonds.
The Bank, in its individual or any other capacity, may become the owner or pledgee of
Bonds with the same rights it would have if it were not the Paying Agent and Registrar for the
Bonds.
Section 4 02. Amendment.
This Agreement may be amended only by an agreement in writing signed by both of the
parties hereof.
Section 4 03 Assignment.
This Agreement may not be assigned by either party without the prior written consent of the
other
Section 4 04 Notices.
Any request, demand, authorization, direction, notice, consent, waiver or other document
provided or permitted hereby to be given or furnished to the Issuer or the Bank shall be mailed or
delivered to the Issuer or the Bank, respectively, at the addresses shown herein, or such other
address as may have been given by one party to the other by 15 days'written notice.
Section 4 05 Effect of Headings.
The Article and Section headings herein are for convenience only and shall not affect the
construction hereof.
Section 4 06 Successors and Assigns.
All covenants and agreements herein by the Issuer and the Bank shall bind their successors
and assigns, whether so expressed or not. This Agreement shall not be assigned by the Bank
without the prior written consent of the Issuer
Section 4 07 Severability.
If any provision of this Agreement shall be invalid or unenforceable, the validity and
enforceability of the remaining provisions hereof shall not in any way be affected or impaired.
Section 4 08. Benefits of Agreement. Nothing herein, express or implied, shall give to any
Person, other than the parties hereto and their successors hereunder, any benefit or any legal or
equitable right, remedy or claim hereunder
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4163-5579-2710.1
Section 4 09 Ordinance Governs Conflicts.
This Agreement and the Ordinance constitute the entire agreement between the parties
hereto relative to the Bank acting as Paying Agent and Registrar and if any conflict exists between
this Agreement and the Ordinance, the Ordinance shall govern. The Bank agrees to be bound by
the terms of the Ordinance with respect to the Bonds.
Section 4 10 Term and Termination.
This Agreement shall be effective from and after its date and may be terminated for any
reason by the Issuer or the Bank at any time upon 60 days' written notice; provided, however,. that
no such termination shall be effective until a successor has been appointed and has accepted the
duties of the Bank hereunder In the event of early termination, regardless of circumstances, the
Bank shall deliver to the Issuer or its designee all funds, Bonds and all books and records
pertaining to the Bank's role as Paying Agent and Registrar with respect to the Bonds, including,
but not limited to,the books of registration.
Section 4 11 Interpleader
The Issuer and the Bank agree that the Bank may seek adjudication of any adverse
claim, demand, or controversy over its person as well as funds on deposit hereunder, in either the
District Court of Harris County, Texas or the United States Federal District Court for the
Southern District of Texas, waive personal service of any process, and agree that service of
process by certified or registered mail, return receipt requested, to the address set forth herein
shall constitute adequate service. The Issuer and the Bank further agree that the Bank has the
right to file a Bill of Interpleader in any court of competent jurisdiction within the State of Texas,
at the expense of the Issuer, to determine the rights of any person claiming any interest
hereunder
Section 4 12. Counterparts
This Agreement may be executed in any number of counterparts, each of which shall be
deemed an original and all of which shall constitute one and the same Agreement.
Section 4 13 Governing Law.
This Agreement shall be construed in accordance with and shall be governed by the laws
of the State of Texas.
Section 4 14 Force Majeure.
In no event shall the Bank be liable for any failure or delay in the performance of its
obligations hereunder because of circumstances beyond the Bank's control, including, but not
limited to, acts of God, flood, war (whether declare4 or undeclared), terrorism, fire, riot, strikes or
work stoppages for any reason, embargo, government action, including any laws, ordinances,
regulations or the like which restrict or prohibit the providing of the services contemplated by this
Agreement, or the failure of equipment or interruption of communications or computer facilities, if
7
4163-5579-2710.1
beyond the Bank's control, and other causes beyond the Bank's control whether or not of the same
class or kind as specifically named above.
Section 4 15 Legislative Contracting Requirements
Pursuant to Section 2252.152, Texas Government Code, neither the Bank nor
any wholly owned subsidiary, majority-owned subsidiary, parent company or affiliate
of the Bank is a company currently listed by the Texas Comptroller of Public
Accounts under Sections 806.051, 807 051, or 2252.153 of the Texas Government
Code.
The Bank hereby warrants and represents to the Issuer that it is a publicly
traded business entity or a wholly owned subsidiary of such a business entity
The Issuer and the Bank hereby certify that this Agreement does not have a
value of $100,000 or more and is therefore exempt from Chapter 2271, Texas
Government Code and Chapter 2274, Texas Government Code (as added by Senate
Bill 13 and Senate Bill 19 in the 87th Texas Legislative Session) The Bank agrees
that its compensation hereunder will not exceed$100,000
[Execution Page Follows]
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4163-5579-2710.1
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
CITY OF PEARLAND
By.
May
ADDRESS 3519 Liberty Drive
Pearland, Texas 77581
ATTEST‘047/VOAPI‘
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City Secretary
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4163-5579-2710.1
COMPUTERSHARE TRUST COMPANY,N.A.
By.
Name
Title: c
10
4163-5579-2710.1
EXHIBIT A
FEES - $0 00
11
4163-5579-2710.1
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (the "Agreement"), dated as of March 27, 2023 and
made effective as of _, 2023 between the City of Pearland, Texas, a political
subdivision of the State of Texas duly created, organized and existing under the Constitution and
laws of the State of Texas (the "City"), and Computershare Trust Company, N.A. (the "Bank"), a
banking association organized and existing under the laws of the United States of America.
WITNESSETH.
WHEREAS, the City has heretofore issued the bonds described on Exhibit A attached
hereto (the "Refunded Bonds"), and
WHEREAS,the City desires to refund in advance of maturity the Refunded Bonds, and
WHEREAS, in accordance with the provisions of Chapter 1207, Government Code, as
amended (the "Code"), the City is authorized to sell refunding bonds in an amount sufficient to
provide for the full and complete payment of obligations, deposit the proceeds of such refunding
bonds with a trust company or commercial bank that does not serve as a depository for the City
and enter into an escrow or similar agreement with such institution for the safekeeping,
investment, reinvestment, administration and disposition of such deposit, upon such terms and
conditions as the parties may agree; and
WHEREAS, the governing body of the City has adopted an ordinance (the "Refunding
Bond Ordinance") authorizing the issuance, sale and delivery of the City's Permanent
Improvement Refunding Bonds, Series 2023, in the aggregate principal amount of$
(the "Refunding Bonds"), for the purpose, among other purposes, of providing the funds
necessary to refund the Refunded Bonds, and
WHEREAS, the governing body of the City has further determined to effectuate the
refunding of the Refunded Bonds pursuant to this Escrow Agreement, under which provision is
made for the safekeeping, investment, reinvestment, administration and disposition of proceeds
of the Refunding Bonds so as to provide firm banking and financial arrangements for the
discharge and final payment of the Refunded Bonds,
NOW, THEREFORE, in consideration of the mutual undertakings, promises and
agreements herein contained, and other good and valuable consideration, the receipt and
sufficiency of which hereby are acknowledged, and in order to secure the full and timely
payment of the principal of and interest on the Refunded Bonds, the City and the Bank contract
and agree as follows.
4145-4398-4454 1
1
ARTICLE I.
DEFINITIONS AND INTERPRETATIONS
Section 1.1. Definitions. Unless otherwise expressly provided or unless the context
clearly requires otherwise, the following terms shall have the respective meanings specified
below for all purposes of this Escrow Agreement:
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the applicable
regulations thereunder and under the Internal Revenue Code of 1954
"City" shall mean the City of Pearland, Texas and, where appropriate,its City Council.
"Escrow Agent" shall mean Computershare Trust Company, .N.A., in its capacity as
escrow agent hereunder, and any successor or assign in such capacity
"Escrow Agreement" shall mean this escrow agreement.
"Escrow Deposit" shall mean the initial deposit into the Escrow Fund, as more
particularly described in Section 2.1
"Escrow Fund" shall mean the fund created in Section 3 1 of this Escrow Agreement to
be administered by the Escrow Agent pursuant to the provisions of this Escrow Agreement.
"Escrow Funding Date" shall mean the date on which the City deposits with the Escrow
Agent the cash and Escrowed Securities described in Section 2.1
"Escrowed Securities" shall mean the Limited Yield Securities and the Open Market
Securities.
"Limited Yield Securities" shall mean the noncallable United States Treasury
Obligations-State and Local Government Series to be initially purchased with proceeds of the
Refunding Bonds, as more fully described in the Report attached hereto, together with all
reinvestments of the proceeds thereof as may be directed in Section 4.2 or permitted in Section
4.3 (b)
"Open Market Securities" shall mean the United States Treasury securities to be
purchased in the open market with cash and the proceeds of the Refunding Bonds, as more fully
described in the Report attached hereto, together with all reinvestments of the proceeds thereof
as may be directed in Section 4.2 or permitted in Section 4.3(b), or cash or obligations
substituted therefor pursuant to Section 4.3(a).
"Paying Agent for the Refunded Bonds" shall mean Computershare Trust Company,
N.A.
"Refunded Bond Ordinance" shall mean the City's resolutions, orders and ordinances, as
the case may be, authorizing the issuance, sale and delivery of the Refunded Bonds.
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4145-4398-4454.1
"Refunded Bonds" shall mean the City's outstanding obligations listed on Exhibit A
hereto
"Refunding Bonds" shall mean the City's Permanent Improvement Refunding Bonds,
Series 2023
"Report" shall mean the verification report prepared by Robert Thomas CPA, LLC,
independent certified public accountants, relating to the advance refunding of the Refunded
Bonds, and any subsequent verification report required by Section 4.3
Section 1.2. Interpretations. The titles and headings of the articles and sections of this
Escrow Agreement have been inserted for convenience of reference only and are not to be
considered a part hereof and shall not in any way modify or restrict the terms hereof. This
Escrow Agreement and all of the terms and provisions hereof shall be liberally construed to
effectuate the purposes set forth herein and to achieve the intended purpose of providing for the
refunding of the Refunded Bonds in accordance with applicable law
ARTICLE II.
DEPOSIT OF FUNDS AND ESCROWED SECURITIES
Section 2.1. Deposits with Escrow Agent; Acquisition of Escrowed Securities. On the
Escrow Funding Date, the City shall deposit, or cause to be deposited, with the Escrow Agent
the following:
(a) Escrowed Securities more fully described in the Report; and
(b) A beginning cash balance as provided in the Report.
ARTICLE III.
CREATION AND OPERATION OF ESCROW FUND
Section 3.1. Escrow Fund. On the Escrow Funding Date, the Escrow Agent will create in
its books a special fund and irrevocable escrow to be known as the City of Pearland, Texas
Refunding Bonds, Series 2023 Escrow Fund into which will be deposited the cash and
Escrowed Securities described in Section 2.1 The Escrowed Securities, all proceeds therefrom
and all cash balances from time to time on deposit in the Escrow Fund shall be the property of
the Escrow Fund and shall be applied only in strict conformity with the terms and conditions
hereof. The Escrowed Securities, all proceeds therefrom and all cash balances from time to time
on deposit in the Escrow Fund are hereby irrevocably pledged to the payment of the principal of
and interest on the Refunded Bonds, which payment shall be made by timely transfers to the
Paying Agent for the Refunded Bonds of such amounts at such times as are provided in Section
3.2. When the final transfers have been made to the Paying Agent for the Refunded Bonds for
the payment of such principal of and interest on the Refunded Bonds, any balance then
remaining in the Escrow Fund shall be transferred to the City, and the Escrow Agent shall
thereupon be discharged from any further duties hereunder
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4145-4398-4454.1
Section 3.2. Payment of Principal, Redemption Premium, if any, and Interest;
Redemption of Certain Refunded Bonds. (a) The Escrow Agent is hereby irrevocably instructed
to transfer to the Paying Agent for the Refunded Bonds from the cash balance from time to time
on deposit in the Escrow Fund the amounts required to pay the principal of, redemption
premium, if any, and interest on the Refunded Bonds in the amounts and at the times shown in
the Report; provided, however, that funds transferred to the Escrow Fund from the interest and
sinking funds for the Refunded Bonds, if any, and all investment earnings thereon be used for the
payment of the principal of, redemption premium, if any, and interest on the Refunded Bonds
prior to the use of proceeds of the Refunding Bonds for such purpose.
(b) Except for amounts transferred to the Paying Agent for the Refunded Bonds
pursuant to Section 3.2(a) and to the City pursuant to Section 4.2, the Escrow Agent agrees that
it shall never make any withdrawals from the Escrow Fund or assert any claims, liens or charges
against the Escrow Fund.
Section 3.3. Sufficiency of Escrow Fund. The City represents (based upon the Report)
that the successive receipts of the principal of and interest on the Escrowed Securities will
assure that the cash balance on deposit from time to time in the Escrow Fund will be at all
times sufficient to provide money for transfer to the Paying Agent for the Refunded Bonds at
the times and in the amounts required to pay the interest on the Refunded Bonds as such
interest comes due and to pay the principal of, redemption premium, if any, and interest on the
Refunded Bonds as the Refunded Bonds mature or are called for redemption, all is more fully
set forth in the Report. If, for any reason, at any time, the cash balances on deposit or
scheduled to be on deposit in the Escrow Fund shall be insufficient to transfer the amounts
required by the Paying Agent for the Refunded Bonds to make the payments set forth in
Section 3.2, the City shall timely deposit into the Escrow Fund, from lawfully available funds,
additional funds in the amounts required to make such payments. Notice of any such
insufficiency shall be given promptly by the Escrow Agent to the City as hereinafter provided,
but the Escrow Agent shall not in any manner be responsible for any insufficiency of funds in
the Escrow Fund or the City's failure to make additional deposits thereto
Section 3.4. Escrow Fund. The Escrow Agent at all times shall hold the Escrow Fund,
the Escrowed Securities and all other assets of the Escrow Fund wholly segregated from all
other funds and securities on deposit with the Escrow Agent; it shall never allow the Escrowed
Securities or any other assets of the Escrow Fund to be commingled with any other funds or
securities of the Escrow Agent; and it shall hold and dispose of the assets of the Escrow Fund ,
only as set forth herein. The Escrowed Securities and other assets of the Escrow Fund always
shall be maintained by the Escrow Agent for the benefit of the holders of the Refunded Bonds,
and a special account evidencing such fact shall be maintained at all times on the books of the
Escrow Agent. The holders of the Refunded Bonds shall be entitled to the same preferred claim
and first lien upon the Escrowed Securities, the proceeds thereof and all other assets of the
Escrow Fund to which they are entitled as holders of the Refunded Bonds. The amounts
received by the Escrow Agent under this Escrow Agreement shall not be considered as a
banking deposit by the City, and the Escrow Agent shall have no right or title with respect
thereto except as escrow agent under the terms hereof The amounts received by the Escrow
Agent hereunder shall not be subject to warrants, drafts or checks drawn by the City or, except
to the extent expressly herein provided,by the Paying Agent for the Refunded Bonds.
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4145-4398-4454.1
Section 3.5. Security for Cash Balances. Cash balances from time to time on deposit in
the Escrow Fund, to the extent not insured by the Federal Deposit Insurance Corporation or its
successor, shall be continuously secured by a pledge of direct -obligations of, or obligations
unconditionally guaranteed by, the United States of America, having a market value at least
equal to such cash balances, to the extent and manner required by Chapter 2257, Texas
Government Code.
Section 3.6 Grant of Security Interest. In order to secure payment when due of the
principal of and interest on the Refunded Bonds, the City hereby pledges and grants to the
Escrow Agent, for the account of the holders or owners of the Refunded Bonds and of any
appurtenant coupons, a security interest in all of its right, title, and interest, if any, in and to all
funds held hereunder and all investments thereof and agrees that the Escrow Agent shall have
and may exercise all of the rights of a secured party granted by the Texas Uniform Commercial
Code in respect thereof to the same extent as if such Code applied to such security interest.
ARTICLE IV.
LIMITATION ON INVESTMENTS
Section 4.1. General. Except as herein otherwise expressly provided, the Escrow Agent
shall not have any power or duty to invest any money held hereunder, to make substitutions of
the Escrowed Securities or to sell, transfer or otherwise dispose of the Escrowed Securities.
Section 4.2. Reinvestment of Proceeds of Open Market Securities. The Escrow Agent is
hereby authorized and directed to reinvest proceeds of the Open Market Securities, if any,
which are attributable to amounts received as principal of or interest on the Open Market
Securities and which are not immediately needed to pay the Refunded Bonds in direct
obligations of the United States of America, i.e., United States Treasury Bonds,Bills and Notes,
in the amounts, and maturing and bearing interest, all as set out in the Report. The City hereby
designates and appoints the Escrow Agent as its agent and duly authorized representative for
purposes of subscribing for and purchasing such obligations, all of which shall constitute
Escrowed Securities Any income or increment earned from such reinvestment remaining after
final payment of the Refunded Bonds, shall be promptly transferred to the City
Section 4.3. Substitution of Securities. (a) Concurrently with the sale and delivery of
the Refunding Bonds, the City may, upon compliance with the conditions stated in subsection
(c) of this Section 4.3, at its option, substitute cash or non-interest bearing obligations of the
United States Treasury (i.e., Treasury obligations which mature and are payable in a stated
amount on the maturity date thereof and for which there are no payments other than the
payment made on the maturity date) for non-interest bearing Open Market Securities listed in
the Report, but only if such cash and/or substituted non-interest bearing direct obligations of
the United States Treasury.
(i) are in an amount, and/or mature in an amount, which, together with any cash
substituted for such obligations, is equal to or greater than the amount payable on
the maturity date of the obligation listed in the Report for which such obligation is
substituted, and
5
4145-4398-4454 1
(ii) mature on or before the maturity date of the obligation listed in the Report for
which such obligation is substituted.
The City may at any time substitute any Open Market Securities which, as permitted by the
preceding sentence, were not deposited to the credit of the Escrow Fund, for the cash and/or
obligations that were substituted concurrently with the sale and delivery of the Refunding Bonds
for such Open Market Securities.
(b) At the written request of the City, and upon compliance with the conditions
hereinafter stated in subsection (c) of this Section 4.3, the Escrow Agent shall sell, transfer,
otherwise dispose of or request the redemption of all or any portion of the Escrowed Securities
and apply the proceeds therefrom to purchase Refunded Bonds or direct obligations of, or
obligations the principal of and interest on which are unconditionally guaranteed by, the United
States of America which do not permit the redemption thereof at the option of the obligor
(c) Any such transaction described in subsections (a) and (b) of this Section 4.3 may
be affected by the Escrow Agent only if (1) the Escrow Agent shall have received a written
opinion from a recognized firm of certified public accountants that such transaction will not
cause the amount of money and securities in the Escrow Fund to be reduced below an amount
which will be sufficient, when added to the interest to accrue thereon, to provide for the
payment of principal of, redemption premium, if any, and interest on the remaining Refunded
Bonds as they become due, and (2) the Escrow Agent shall have received the unqualified
written legal opinion of nationally recognized bond counsel or tax counsel acceptable to the City
and the Escrow Agent to the effect that (a) such transaction will not cause any of the Refunded
Bonds or Refunding Bonds to be an "arbitrage bond" within the meaning of the Code and (b)
that such transaction complies with the Constitution and laws of the State of Texas and with all
relevant documents relating to the issuance of the Refunded Bonds and the Refunding Bonds.
Section 4.4. Arbitrage. The' City hereby covenants and agrees that it shall never request
the Escrow Agent to exercise any power hereunder or permit any part of the money in the
Escrow Fund or proceeds from the sale of Escrowed Securities to be used directly or indirectly
to acquire any securities or obligations if the exercise of such power or the acquisition of such
securities or obligations would cause any Refunding Bonds to be an "arbitrage bond" within the
meaning of the Code.
ARTICLE V.
RECORDS AND REPORTS
Section 5.1. Records. The Escrow Agent shall keep books of record and account in
which complete and correct entries shall be made of all transactions relating to the receipt,
disbursement, allocation and application of the money and Escrowed Securities deposited to
the Escrow Fund and all proceeds thereof, and such books shall be available for inspection at
reasonable hours and under reasonable conditions by the City and the holders of the Refunded
Bonds.
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4145-4398-4454 1
Section 5.2. Reports. For the period beginning on the Escrow Funding Date and ending
on September 30, 2023, and for each twelve (12) month period thereafter while this Agreement
remains in effect, the Escrow Agent shall prepare and send to the City within thirty (30) days
following the end of such period a written report summarizing all transactions relating to the
Escrow Fund during such period, including, without limitation, credits to the Escrow Fund as a
result of interest payments on or maturities of the Escrowed Securities and transfers from the
Escrow Fund to the Paying Agent for the Refunded Bonds or otherwise, together with a detailed
statement of all Escrowed Securities and the cash balance on deposit in the Escrow Fund as of
the end of such period.
ARTICLE VI.
CONCERNING THE ESCROW AGENT
Section 6.1. Representations of Escrow Agent. Computershare Trust Company, N.A.,
hereby represents that it has all necessary power and authority to enter into this Escrow
Agreement and undertake the obligations and responsibilities imposed upon it herein and that it
will carry out all of its obligations hereunder
Section 6.2. Limitation on Liability. The liability of the Escrow Agent to transfer funds to
the Paying Agent for the Refunded Bonds for the payments of the principal of, redemption
premium, if any, and interest on the Refunded Bonds shall be limited to the proceeds of the
Escrowed Securities and the cash balances from time to time on deposit in the Escrow Fund.
Notwithstanding any provision contained herein to the contrary, the Escrow Agent shall have no
liability whatsoever for the insufficiency of funds from time to time in the Escrow Fund or any
failure of the obligor of the Escrowed Securities to make timely payment thereon, except for its
obligation to notify the City promptly of any such occurrence.
The recitals herein and in the proceedings authorizing the Refunding Bonds shall be
taken as the statements of the City and shall not be considered as made by, or imposing any
obligation or liability upon, the Escrow Agent. The Escrow Agent is not a party to the Refunding
Bond Ordinance or the Refunded Obligation Ordinances and in its capacity as Escrow Agent is
not responsible for or bound by any of the provisions thereof. In its capacity as Escrow Agent, it
is agreed that the Escrow Agent need look only to the terms and provisions of this Escrow
Agreement.
The Escrow Agent makes no representation as to the value, condition or sufficiency of
the Escrow Fund, or any part thereof, or as to the title of the City thereto, or as to the security
afforded thereby or hereby, and the Escrow Agent shall incur no liability or responsibility with
respect to any of such matters.
It is the intention of the City and the Escrow Agent that the Escrow Agent shall never be
required to use or advance its own funds or otherwise incur personal financial liability in the
performance of any of its duties or the exercise of any of its rights and powers hereunder
The Escrow Agent shall not be liable for the performance of any duties, except such
duties as are specifically set forth in this Escrow Agreement, and no implied covenants or
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4145-4398-4454.1
obligations shall be read into this Escrow Agreement. Nothing herein contained shall relieve the
Escrow Agent from liability for its own negligent action, negligent failure to act or willful
misconduct, except that this sentence shall not be construed to limit the effect of the immediately
preceding sentence. The Escrow Agent shall not incur any liability for any error of judgment
made in good faith by a responsible officer thereof, unless it shall be proved that it was negligent
in ascertaining the pertinent facts. The Escrow Agent shall be protected in acting upon any
notice, resolution, request, consent, order, certificate, report, opinion, bond or other paper or
document believed by it to be genuine, and to have been signed or presented by the proper party
or parties. The Escrow Agent may consult with counsel, and the opinion of such counsel shall be
full and complete authorization and protection in respect of any action taken or suffered by it in
good faith and in accordance therewith.
Unless it is specifically provided otherwise herein, the Escrow Agent has no duty to
determine or inquire into the happening or occurrence of any event or contingency or the
performance or failure of performance of the City with respect to arrangements or contracts
with others, with the Escrow Agent's sole duty hereunder being to safeguard the Escrow Fund
and to dispose of and deliver the same in accordance with this Escrow Agreement. If, however,
the Escrow Agent is called upon by the terms of this Escrow Agreement to determine the
occurrence of any event or contingency, the Escrow Agent shall be obligated, in making such
determination, only to exercise reasonable care and diligence, and in the event of error in
making such determination the Escrow Agent shall be liable only for its own misconduct or its
negligence. In determining the occurrence of any such event or contingency the Escrow Agent
may request from the City or any other person such reasonable additional evidence as the
Escrow Agent in its discretion may deem necessary to determine any fact relating to the
occurrence of such event or contingency, and in this connection may make inquiries of, and
consult with the City, among others, at any time.
The Escrow Agent shall not be liable for any action taken or neglected to be taken by it in
good faith in the exercise of reasonable care and believed by it to be within the discretion or
power conferred upon it by this Escrow Agreement, nor shall the Escrow Agent be responsible
for the consequences of any error of judgment; and the Escrow Agent shall not be answerable
except for its own neglect or default, nor for any loss unless the same shall have been through its
negligence or want of good faith.
In the absence of bad faith, the Escrow Agent may rely conclusively upon the truth,
completeness and accuracy of the statements, certificates, opinions, resolutions and other
documents conforming to the requirements of this Escrow Agreement, and shall not be obligated
to make any independent investigation with respect thereto.
To the full extent permitted by law, the parties agree to indemnify, defend and hold the
Escrow Agent harmless from and against any and all loss, damage, tax, liability and expense that
may be incurred by the Escrow Agent arising out of or in connection with its acceptance or
appointment as Escrow Agent hereunder, including attorneys fees and expenses of defending
itself against any claim or liability in connection with its performance hereunder except that the
Escrow Agent shall not be indemnified for any loss, damage, tax, liability, or expense resulting
from its own negligence or willful misconduct.
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Section 6.3. Compensation. On the Escrow Funding Date, the City will pay the Escrow
Agent, as a fee for performing the services hereunder and for all expenses incurred or to be
incurred by the Escrow Agent in the administration of this Escrow Agreement the sum of an
acceptance fee of $ , an annual fee of $ , which does not include fees for the
Refunding Bonds. The Paying Agent for the Refunded Bonds will continue to act as Paying
Agent for the Refunded Bonds under the existing fee schedules, with the sole remedy for
nonpayment being an action for amounts owing under the Paying Agency Agreements. This sum
does not include the costs of publication, printing costs, or reasonable out-of-pocket expenses of
the Escrow Agent. If the Escrow Agent is requested to perform any extraordinary services
hereunder, the City hereby agrees to pay reasonable fees to the Escrow Agent for such
extraordinary services and to reimburse the Escrow Agent for all expenses incurred by the
Escrow Agent in performing such extraordinary services. It is expressly provided that the Escrow
Agent shall look only to the City for the payment of such additional fees and reimbursement of
such additional expenses. The Escrow Agent hereby agrees that in no event shall it ever assert
any claim or lien against the Escrow Fund for any fees for its services, whether regular,
additional or extraordinary, as Escrow Agent, or in any other capacity, or for reimbursement for
any of its expenses.
The Escrow Agent acknowledges that it also acts as the Paying Agent for the Refunded
Bonds initially issued by the City The Escrow Agent, in its capacity as Paying Agent for such
Refunded Bonds, agrees that it shall continue to provide the services of Paying Agent for the
Refunded Bonds so long as the principal of and interest on the Refunded Bonds is being paid
pursuant to the terms of this Agreement, that it shall continue to be paid for such services as
Paying Agent pursuant to the terms of the paying agent agreement(s) currently in effect for such
Refunded Bonds, and that the sole remedy for nonpayment by the City of any fees due to the
Paying Agent will be an action for amounts owed under such paying agent agreement(s)
Section 6.4. Successor Escrow Agents. If at any time the Escrow Agent or its legal
successor or successors should become unable, through operation of law or otherwise, to act as
escrow agent hereunder, or if its property and affairs shall be taken under the control of any
state or federal court or administrative body because of insolvency or bankruptcy or for any
other reason, a vacancy shall forthwith exist in the office of Escrow Agent hereunder In such
event the City, by appropriate action, shall promptly appoint an Escrow Agent to fill such
vacancy If no successor Escrow Agent shall have been appointed by the City within 60 days, a
successor may be appointed by the holders of a majority in aggregate principal amount of the
Refunded Bonds then outstanding by an instrument or instruments in writing filed with the City,
signed by such holders or by their duly authorized attorneys. If, in a proper case, no
appointment of a successor Escrow Agent shall be made pursuant to the foregoing provisions of
this section within three months after a vacancy shall have occurred, the holder of any Refunded
Obligation then out-standing may apply to any court of competent jurisdiction to appoint a
successor Escrow Agent. Such court may thereupon, after such notice, if any, as it may deem
proper, prescribe and appoint a successor Escrow Agent.
Any successor Escrow Agent shall be qualified to act in such capacity under Chapter
1207, Texas Government Code, as amended, and shall be a corporation organized and doing
business under the laws of the United States or the State of Texas, authorized under such laws to
9
4145-4398-4454.1
exercise corporate trust powers, having a combined capital and surplus of at least $50,000,000
and subject to supervision or examination by federal or state authority
Any successor Escrow Agent shall execute, acknowledge and deliver to the City and the
Escrow Agent an instrument accepting such appointment hereunder, and the Escrow Agent shall
execute and deliver an instrument transferring to such successor Escrow Agent, subject to the
terms of this Agreement, all the rights, powers and trusts of the Escrow Agent hereunder Upon
the request of any such successor Escrow Agent,the City shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor Escrow Agent
all such rights, powers and duties. The Escrow Agent shall pay over to its successor Escrow
Agent a proportional part of the Escrow Agent's fee paid hereunder
The Escrow Agent at the time acting hereunder may at any time resign and be discharged
from the escrow hereby created by giving not less than sixty (60) days' written notice to the City
specifying the date when such resignation will take effect. No such resignation shall take effect
unless a successor Escrow Agent shall have been appointed by the holders of the Refunded
Bonds or by the City as herein provided and such successor Escrow Agent shall have accepted
such appointment, in which event such resignation shall take effect immediately upon the
appointment and acceptance of a successor Escrow Agent.
The Escrow Agent may be removed at any time by an instrument or concurrent
instruments in writing delivered to the Escrow Agent and to the City and signed by the holders of
a majority in aggregate principal amount of the Refunded Bonds then outstanding.
Section 6.5. Redemption Prior to Maturity of Refunded Bonds. The City has irrevocably
exercised its option to call the bonds of the District for redemption prior to maturity on the dates
and amounts shown on Exhibit A attached hereto and authorized and directed notice of such
redemption to be given in accordance with the orders authorizing the issuance of such bonds.
The Escrow Agent, as Paying Agent for the Refunded Bonds, agrees to provide such notice of
redemption in accordance with the orders.
ARTICLE VII.
MIS CELLANEOUS
Section 7.1. Notices. Any notice, authorization, request or demand required or permitted
to be given hereunder shall be made or given in writing and shall be deemed to have been duly
given when mailed by registered or certified mail, postage prepaid, addressed as follows.
To the Escrow Agent:
Computershare Trust Company, N.A.
Corporate Trust Services
600 S 4th St 6th Floor
MAC N9300-060
Minneapolis,Minnesota 55415
10
4145-4398-4454.1
To the City.
City of Pearland,Texas
3519 Liberty Drive
Pearland, Texas 77581
Attention. Mayor
The United States Post Office registered or certified mail receipt showing delivery of the
aforesaid shall be conclusive evidence of the date and fact of delivery Either party hereto may
change the address to which notices are to be delivered by giving to the other party not less than
ten days' prior written notice thereof
Section 7.2. Termination of Responsibilities. Upon the taking by the Escrow Agent of all
the actions as described herein, the Escrow Agent shall have no further obligations or
responsibilities hereunder to the City, the holders of the Refunded Bonds or to any other person
or persons in connection with this Escrow Agreement.
Section 7.3. Binding Agreement; Amendment. This Escrow Agreement shall be binding
upon the City and the Escrow Agent and their respective successors and legal representatives and
shall inure solely to the benefit of the holders of the Refunded Bonds,the City, the Escrow Agent
and their respective successors and legal representatives. This Escrow Agreement shall not be
subject to amendment without the written consent of the holders of all Refunded Bonds then
outstanding.
Section 7.4. Severability. If any one or more of the provisions contained in this Escrow
Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other provision of this Escrow
Agreement,, but this Escrow Agreement shall be construed as if such invalid or illegal or
unenforceable provision had never been contained herein.
Section 7.5. Governing Law. This Escrow Agreement shall be governed exclusively by
the provisions hereof and by the applicable laws of the State of Texas.
Section 7.6. Time of Essence. Time shall be of the essence in the performance of
obligations from time to time imposed upon the Escrow Agent by this Escrow Agreement.
Section 7.7. Legislative Contracting Requirements.
Pursuant to Section 2252.152, Texas Government Code, neither the Bank nor any wholly
owned subsidiary, majority-owned subsidiary, parent company or affiliate of the Bank is a
company currently listed by the Texas Comptroller of Public Accounts under Sections 806 051,
807 051, or 2252.153 of the Texas Government Code.
The Bank hereby warrants and represents to the Issuer that it is a publicly traded business
entity or a wholly owned subsidiary of such a business entity
The Issuer and the Bank hereby certify that this Agreement does not have a value of
$100,000 or more and is therefore exempt from Chapter 2271, Texas Government Code and
11
4145-4398-4454.1
Chapter 2274, Texas Government Code (as added by Senate Bill 13 and Senate Bill 19 in the
87th Texas Legislative Session) The Bank agrees that its compensation hereunder will not
exceed$100,000
[signature page follows]
12
4145-4398-4454.1
EXECUTED as of the date first wntten above, but effective as set forth herein.
CITY OF PEARLAND, TEXAS
yor
ATTEST
City Secretary
00, , ,,,,
� ?EAR
O O
poi t:
13
4145-4398-4454.1
COMPUTERSHARE TRUST COMPANY,N.A.,
as Escrow Agent
By
Title Escrow Agent
r
14
4145-4398-4454 1
EXHIBIT A
SCHEDULE OF REFUNDED BONDS
A-1
4145-4398-4454.1
EXHIBIT B
FEE SCHEDULE
1
B-1
4145-4398-4454.1
CITY OF PEARLAND, TEXAS
3519 Liberty Drive
Pearland,Texas 77581
GUith 1 1 , 2023
Computershare Trust Company,N.A.
Computershare Corporate Trust
600 S 4th Street, 7th Floor
MAC N9300-070
Minneapolis,MN 55415
Ladies and Gentlemen.
The bonds described on Exhibit A attached hereto have been called for redemption prior
to scheduled maturities on the redemption date set out in Exhibit A and at the redemption price of
par plus accrued interest to the date fixed for redemption,by the City of Pearland. As registrar for
such bonds, you are hereby directed to give notice of redemption in accordance with the order
authorizing their issuance. Such notice is to be given at least thirty(30)days prior to the date fixed
for redemption by first class mail, addressed to the registered owners of each Bond to be redeemed
in whole or in part at the address shown on the books of registration kept by the Registrar
The notice must identify the bonds to be redeemed and must set out the following
information.
(A) Redemption Dates (see attached Exhibit A).
(B) Redemption Price (par plus accrued interest)
(C) Place at which bonds are to be surrendered for payment (Computershare)
(D) The number of the bonds or portions thereof to be redeemed.
(E) The principal amount and identification of bonds.
(Signature Pages to Follow)
4125-3183-2646.1
CITY OF PEARLAND, TEXAS
ie- , fil _
i
4125-3183-2646.1
Receipt Acknowledged on this day of , 2023
COMPUTERSHARE TRUST COMPANY,N.A.
By.
Name:
Title:
4125-3183-2646.1
EXHIBIT A
4125-3183-2646.1
CLOSING CERTIFICATE
STATE OF TEXAS
COUNTIES OF BRAZORIA, FORT BEND AND HARRIS
CITY OF PEARLAND
Capitalized terms used in this certificate and not otherwise defined herein shall have the meanings
assigned thereto in the ordinance (the "Ordinance") authorizing the issuance of the City's Permanent
Improvement Refunding Bonds, Series 2023 (the"Bonds"), I, the undersigned,Mayor, acting solely in my
official capacity,hereby certify, as follows.
(i) The representations and warranties of the City contained in the Purchase Letter are true
and correct in all material respects on and as of the date of Closing as if made on the date
of Closing;
(ii) no litigation or proceeding against the City is pending or, to the best of my knowledge,
threatened in any court or administrative body nor is there a basis for litigation which
would (a) contest the right of the commissioners, officers or officials of the City to hold
and exercise their respective positions, (b) contest the due organization and valid existence
of the City, (c) contest the validity, due authorization and execution of the Bonds or the
Ordinance, (d) prohibit, restrain or enjoin the sale, issuance or delivery of the Bonds or the
levy and collection of taxes pledged to the payment of principal of and interest on the
Bond pursuant to the Ordinance, or (e) attempt to limit, enjoin or otherwise prevent the
City from functioning and collecting taxes or any other income or levying and collecting
the taxes pledged or to be pledged to pay the principal of and interest on the Bonds, or the
pledge thereof;
(iii) all official action of the City relating to the Ordinance and the Bond have been duly taken
by the City, are in full force and effect and have not been modified, amended,
supplemented or repealed,
(iv) there has not been any material adverse change in the financial condition of the City since
September 30,2022, the latest date as of which audited financial information is available.
[Signature Page Follows]
1
4164-5717-6902.1
EXECUTED ON BEHALF OF THE DISTRICT as of GVICII D'1, 2023
CITY OF PEARLAND, TEXAS
!nor
2
4164-5717-6902.1
CITY OF PEARLAND, TEXAS
NOTE. PLEASE USE BLUE INK. DO NOT PUT THE SEAL OVER ANY PRINT ON
THIS PAGE.
SIGNATURES:
M r
CityS cret
azY
O
SEAL ,