R2003-0071 05-12-03RESOLUTION NO. R2003-71
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PEARLAND,
TEXAS, APPROVING A BOND ORDER OF BRAZORIA COUNTY
MUNICIPAL UTILITY DISTRICT NO. 6 AUTHORIZING THE ISSUANCE OF
$8,500,000 UNLIMITED TAX BONDS, SERIES 2003.
WHEREAS, the Brazoria County Municipal Utility District No. 6 (the "District") is
located within the extraterritorial jurisdiction of the City of Pearland, Texas
(the "City"); and
WHEREAS, by Resolution No. R 86-7, dated February 10, 1986, the City
Section 1.
true and correct.
Section 2.
consented to the creation of the District, and placed certain conditions on the issuance
of bonds by the District, including the approval by the City Council of the District's
resolution authorizing the issuance of such bonds; and
WHEREAS, the City Council has considered such a bond resolution in connection
with the issuance of the District's proposed $8,500,000 Unlimited Tax Bonds,
Series 2003, and has found it to be acceptable; now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS:
All of the matters and facts set forth in the preamble hereof are
The bond order of the board of directors of Brazoria County
Municipal Utility District No. 6, authorizing the issuance of its $8,500,000 Unlimited
Tax Bonds, Series 2003, is hereby approved.
Section 3. The Mayor of the City of Pearland is hereby authorized to execute
such letters or other documents required to be provided to the Attorney General of
Texas in connection with the issuance of such bonds by the District.
RESOLUTION NO. R2003-71
Section 4. This Resolution shall take effect immediately from and after its
passage in accordance with the provisions of the Charter of the City of Pearland and it
is accordingly so resolved.
PASSED, APPROVED and ADOPTED this the 12th day of Ha_v ,
A. D., 2003.
TOM REID
MAYOR
ATTEST:
C~ SECRETARY r
APPROVED AS TO FORM:
DARRIN M. COKER
CITY ATTORNEY
2
OFFICIAL NOTICE OF SALE AND
PRELIMINARY OFFICIAL STATEMENT
$8,500,000
BRAZORIA COUNTY
MUNICIPAL UTILITY DISTRICT NO. 6,
OF BRAZORIA COUNTY, TEXAS
(A Political Subdivision of the State of Texas
located in Brazoria County, Texas)
UNLIMITED TAX BONDS, SERIES 2003
Selling: Friday, May 30, 2003, at 12:00 Noon, Houston, Texas Time
Prepared under the supervision of
Legg Mason Wood Walker
Incorporated
1111 Bagby Street, Suite 1400
Houston, Texas 77002
Financial Advisor to the District
This OFFICIAL NOTICE OF SALE does not alone constitute an invitation for bids on the Bonds but is merely
notice of sale of the Bonds described herein. The invitation for bids is being made by means of this OFFICIAL
NOTICE OF SALE, the PRELIMINARY OFFICIAL STATEMENT and the OFFICIAL BID FORM attached
hereto. Information contained in this OFFICIAL NOTICE OF SALE is qualified in its entirety by the more detailed
information contained in the PRELIMINARY OFFICIAL STATEMENT.
NEW ISSUE - Book-Entry-Only
OFFICIAL NOTICE OF SALE
$8,500,000
BRAZORIA COUNTY MUNICIPAL UTILITY DISTRICT NO. 6,
OF BRAZORIA COUNTY, TEXAS
(A political subdivision of the State of Texas located in Brazoria County, Texas)
UNLIMITED TAX BONDS, SERIES 2003
Selling: Friday, May 30, 2003, at 12:00 Noon, Houston, Texas Time
The Bonds are obligations solely of Brazoria County Municipal Utility District No. 6, of Brazoria County, Texas
(the "District"), and are not obligations of the State of Texas; Brazoria County; the City of Pearland, Texas; City of
Manvel, Texas; or any entity other thanlhe District.
THE BONDS ARE NOT "QUALIFIED TAX-EXEMPT OBLIGATIONS" FOR FINANCIAL INSTITUTIONS.
THE SALE
Bonds Offered for Sale at Competitive Bidding... Brazoria County Municipal Utility District No. 6, of Brazoria
County, Texas (the "District"), is offering for sale $8,500,000 Unlimited Tax Bonds, Series 2003 (the "Bonds").
Address of Bids... Sealed bids, plainly marked "Bid for Bonds," should be addressed and delivered to the Board of
Directors, Brazoria County Municipal Utility District No. 6, at the designated meeting place outside the boundaries of
the District, c/o Schwartz, Page & Harding, L.L.P., 1300 Post Oak Blvd., Suite 1400, Houston, Texas 77056 prior to
12:00 Noon, Houston, Texas Time, on the date of the bid opening. No bids will be accepted after 12:00 Noon. All bids
must be submitted in duplicate on the Official Bid Form, copies of which accompany the Preliminary Official
Statement.
Time and Place of Bid Opening... The District will open and publicly read sealed bids for the purchase of the Bonds
at the designated meeting place outside the boundaries of the District, c/o Schwartz, Page & Harding, L.L.P., 1300 Post
Oak Blvd., Suite 1400, Houston, Texas 77056, at 12:00 Noon, Houston, Texas Time, Friday, May 30, 2003. The Board
of Directors of the District will formally award the sale of the Bonds at its meeting.
Award of Bonds... The District will take action to award the Bonds or reject all bids promptly upon the Board of
Directors reviewing and approving the bids. Upon awarding the Bonds, the District also will adopt the order
authorizing issuance of the Bonds (the "Order") and will approve the Official Statement. Sale of the Bonds will be
made subject to the terms, conditions and provisions of the Order, to which reference is hereby made for all purposes.
THE BONDS
Description of Bonds . . . The Bonds will be dated June 1, 2003, and interest on the Bonds will be payable
September 1, 2003, and semiannually thereafter on each March 1 and September 1 ("Interest Payment Date") until
maturity or earlier redemption. The Bonds will be delivered to the Initial Purchaser (hereinafter del'reed) as one
Bond for each maturity, in fully registered form, and may be exchanged for Bonds in the denomination of $5,000 or
any integral multiple thereof. Principal and semiannual interest will be paid by The Bank of New York, New York,
New York, the paying agent/registrar (the "Paying Agent/Registrar"). Principal of and redemption price, if any, of
the Donds will be payable to the registered owner ("Registered Owner") at maturity or earlier redemption upon
presentation and surrender to the Paying Agent/Registrar. Interest on the Bonds will be payable by check dated as of
the Interest Payment Date, and mailed on or before each Interest Payment Date by the Paying Agent/Registrar to
each Registered Owner as of the 15~h day of the month immediately preceding an Interest Payment Date ("Record
Date") or by such other customary banking arrangement as agreed upon by the Paying Agent/Registrar and
Registered Owner, at the risk and the expense of the Registered Owner. The Bonds mature serially on September 1
in the years and amounts shown below.
2004 $275,000 2014 $450,000
2005 275,000 2015 475,000
2006 300,000 2016 500,000
2007 300,000 2017 525,000
2008 325,000 2018 575,000
2009 350,000 2019 600,000
2010 375,000 2020 625,000
2011 375,000 2021 650,000
2012 400,000 2022 700,000
2013 425,000 ..
Redemption Provisions... The District reserves the right to redeem prior to maturity those Bonds maturing on or
after September 1, 2014, in whole or from time to time in part in integral multiples of $5,000 on September 1, 2013,
or on any Interest Payment Date thereafter at a price of par plus accrued interest from the most recent Interest
Payment Date to the date fixed for redemption. If less than all the Bonds are redeemed, the District shall determine
the maturity or maturities and the amounts thereof to be redeemed in integral multiples of $5,000 within a maturity.
If less than all of the Bonds within a maturity are redeemed, the particular Bonds or portions thereof to be redeemed
shall be selected by the Paying Agent/Registrar by method of random selection.
Source and Security of payment,. The Bonds will constitute valid and legally binding obligations of the District,
with principal and interest payable solely from the proceeds of a continuing, direct, annual ad valorem tax levied,
without legal limitation as to rate or amount, against all taxable property located within the District.
Other Terms and Covenants... Other terms of the Bonds and various covenants of the District contained in the
Bond Order are described in the Preliminary Official Statement, to which reference is made for all purposes.
CONDITIONS OF SALE
Types of Bids and Interest Rates... The Bonds will be sold in one block, all or none, and no bid of less than 97%
of par value plus accrued interest to the date of delivery will be considered. Bidders must specify the rate or rates of
interest the Bonds will bear, but no bid which results in a net effective interest rate, as calculated pursuant to
Chapter 1204, Texas Government Code, as amended (the IBA method), of more than % will be considered.
The difference between the highest interest rate bid and the lowest interest rate bid shall not exceed 2%. Interest
rates must be in multiples of 1/8 or 1/20 of 1%. Any number of interest rates and rate changes may be named, but
graduating or declining interest rates within a maturity, split interest rates within a maturity, or supplemental or zero
interest rates will not be acceptable.
Serial Bonds and/or Term Bonds...Bidders have the option of specifying that the principal amount of the Bonds
payable in any two or more consecutive years may, in lieu of maturing in each of such years, be combined into one
or more term bonds. Term bonds may be used for any of the maturities in the years 2014 through 2022, both
inclusive.
In the event that bidders choose to specify one or more term bonds, such term bonds will be subject to mandatory
redemption by the District prior to their scheduled maturities on September 1 in the years and in the amounts set
forth in the maturity schedule of the serial bonds. The term bonds, along with the serial bonds maturing on and after
September 1, 2014, will be subject to optional redemption on September 1, 2013, or any date thereafter, in whole or
from time to time in part, at a price of par plus accrued interest from the most recent interest payment date to the
date fixed for redemption.
Basis of Award . . . For the purpose of awarding sale of the Bonds, the total interest cost of each bid will be
computed by determining, at the interest rate or rates specified, the total dollar value of all interest on the Bonds
from the date thereof to their respective maturities and adding thereto the dollar amount of the discount bid, if any,
or deducting therefrom the premium bid, if any. The District reserves the right to reject any or all bids and to waive
any and all irregularities, except time of filing. Subject to such rights, the Bonds will be axvarded to the bidder
whose bid, based on the above computation, produces the lowest net interest cost to the District. In the event of
mathematical discrepancies between the interest rate or rates and the interest rate cost determined therefrom, as both
appear on the Official Bid Form, the bid will be solely governed by the interest rates shown on the Official Bid
Form.
Good Faith Deposit... Each bid must be accompanied by a bank cashier's check payable to the order of"Brazoria
County Municipal Utility District No. 6" in the amount of $170,000 which is 2% of the par value of the Bonds. The
check will be considered as a Good Faith Deposit, and the check of the successful bidder (the "Initial Purchaser")
will be retained uncashed by the District until the Bonds are delivered. No interest will be paid on the Good Faith
Deposit. Upon payment for and delivery of the Bonds in immediately available funds, the Good Faith Deposit will
be returned uncashed to the Initial Purchaser. If the Initial Purchaser should fail or refuse to make payment for or
accept delivery of the Bonds in accordance with its bid, then the check will be cashed and accepted by the District
as full and complete liquidated damages. Such check may accompany the Official Bid Form or it may be submitted
separately. If submitted separately, it shall be made available to the District prior to the opening of the bids and
shall be accompanied by instructions from the bank on which it is drawn which authorize its use as a Good Faith
Deposit. The checks of the unsuccessful bidders will be returned immediately after bids are opened .and sale of the
Bonds has been awarded.
Financial Advisor's Reservation of Rights... The District's Financial Advisor, Legg Mason Wood Walker, Inc.,
has requested the right to bid on the Bonds, and the District has given its consent.
Rule G-36 Requirements . . . It is the responsibility of the Initial Purchaser to comply with the Municipal
Securities Rule Making Board's Rule G-36 within the required time frame.
OFFICIAL STATEMENT
By accepting the winning bid, the District agrees to the following representations and covenants to assist the Initial
Purchaser in complying with Rule 15c2-12(e) of the Securities and Exchange Commission ("SEC").
Final Official Statement . . . The District has prepared the accompanying Preliminary Official Statement for
dissemination to potential purchasers of the Bonds, but will not prepare any other document or version for such
purpose, except as described below. The District will be responsible for completing the Official Statement by
inserting the interest rates bid, the purchase price bid, anY ratings assigned to the Bonds (if not currently included),
the purchase of municipal bond insurance, if any, and the initial public offering yields as set forth in the Official Bid
Form, or otherwise supplied by the Initial Purchaser, and for preparing and inserting the final debt service schedule.
The District does not intend to amend or supplement the Official Statement otherwise, except to take into account
certain subsequent events, if any, as described below. Accordingly, the District deems the accompanying
Preliminary Official Statement to be final as of its date, within the meaning of SEC Rule 15c2-12(b)(1), except for
the omission of the foregoing items. Notwithstanding the foregoing, the only representations concerning the
absence of material misstatements or omissions from the Official Statement which are or will be made by the
District are those described in the Official Statement under "OFFICIAL STATEMENT - Certification as to Official
Statement."
Changes to Official Statement... If, subsequent to the date of the Official Statement, the District learns, through
the ordinary course of business and without undertaking any investigation or examination for such purposes, or is
notified by the Initial Purchaser, of any adverse event which causes any of the key representations in the Official
Statement to be materially misleading, the District will promptly prepare and supply to the Initial Purchaser a
supplement to the Official Statement which corrects such representation to the reasonable satisfaction of the Initial
Purchaser, unless the Initial Purchaser elects to terminate its obligation to purchase the Bonds as described below.
See "DELIVERY OF THE BONDS AND ACCOMPANYING DOCUMENTS - Conditions to Delivery." The
obligation of the District to do so will terminate when the District delivers the Bonds to the Initial Purchaser, unless
the Initial Purchaser notifies the District that less than all of the Bonds have been sold to ultimate customers on or
before such date, in which case the obligation will extend for an additional period of time (but not for more than 90
days after the sale date) until all of the Bonds have been sold to ultimate customers.
Delivery of Official Statements ... The District will furnish to the Initial Purchaser (and to each other participating
underwriter of the Bonds, within the meaning of SEC Rule 15c2-12(a), designated by the Initial Purchaser), within
seven (7) business days after the sale date, the aggregate number of Official Statements specified in the winning bid.
The District will also furnish to the Initial Purchaser a like number of any supplement or amendment prepared by
the District for dissemination to potential purchasers of the Bonds as described above as well as such additional
copies of the Official Statement or any supplement or amendment as the Initial Purchaser may request prior to the
90th day after the end of. the underwriting period referred to in SEC Rule 15c2-12(e)(2). The District will pay the
expense of preparing up to 250 copies of the Official Statement and an equal number of copies of any supplement or
amendment issued on or before the delivery date, but the Initial Purchaser must pay for all other copies of the
Official Statement or any supplement or amendment thereto.
Continuing Disclosure...The District will agree in the Order to provide certain periodic information and notices
of material events in accordance with Rule 15c2-12, as described in the Preliminary Official Statement under
"CONTINUING DISCLOSURE OF INFORMATION." The Initial Purchaser's obligation to accept and pay for the
Bonds is conditioned upon delivery to the Initial Purchaser of the certified copy of the Order containing the
agreement described under such heading.
DELIVERY OF THE BONDS AND ACCOMPANYING DOCUMENTS
Initial Delivery of Initial Bonds... Initial delivery ("Initial Delivery") will be accomplished by the issuance of one
initial bond for each maturity (the "Initial Bonds"), either in typed or printed form, registered in the name of the
Initial Purchaser, manually signed by the President or Vice President and Secretary or Assistant Secretary of the
Board, or executed by such facsimile signatures and approved by the Attorney General of Texas, and registered and
manually signed by the Comptroller of Public Accounts of Texas or his authorized deputy. Upon delivery of the
Initial Bonds, they shall be immediately cancelled and one definitive Bond for each maturity will be registered and
delivered only to Cede & Co. and deposited with DTC in connection with DTC's Book-Entry-Only System. Initial
Delivery will be at the principal corporate trust office of the Paying Agent/Registrar in Houston, Texas on June 26,
2003. Payment for the Bonds must be made in immediately available funds for unconditional credit to the District,
or as otherwise directed by the District. The Initial Purchaser will be given five (5) business days' notice of the time
fixed for delivery of the Bonds. It is anticipated that Initial Delivery can be made on or about June 26, 2003, and,
subject to the aforementioned notice, it is understood and agreed that the Initial Purchaser will accept delivery of
and make payment for the Bonds by 10:00 A.M., Houston, Texas time, June 26, 2003, or thereafter on the date the
Bonds are tendered for delivery, up to and including July 29, 2003. If for any reason the District is unable to make
delivery on or before July 29, 2003, then the District shall immediately contact the Initial Purchaser and offer to
allow the Initial Purchaser to extend its offer for an additional thirty (30) days. If the Initial Purchaser does not elect
to extend its offer within six (6) business days thereafter, then its Good Faith Deposit will be returned, and both the
District and the Initial Purchaser shall be relieved of any further obligation.
Delivery of Exchange Bonds... Upon presentment of the Initial Bonds and upon payment for the Initial Bonds at
the time of the Initial Delivery, the Paying Agent/Registrar shall cancel the Initial Bonds and deliver the exchange
Bonds in denominations of any integral multiple of $5,000 for any one maturity in accordance with instructions
received from the Initial Purchaser as to the persons to whom such exchange bonds are to be registered and
transferred, the addresses of such persons, and the principal amounts and maturity of such exchange Bonds. Such
Bonds shall be registered by the Paying Agent/Registrar. If the Initial Purchaser desires to exchange the Initial
Bonds for exchange Bonds on the same day as the delivery of the Initial Bonds, the Initial Purchaser must furnish to
the Paying Agent/Registrar, at least five (5) business days prior to the Initial Delivery, written instructions on forms
to be provided by the Paying Agent/Registrar designating the names of the persons to whom such exchange Bonds
are to be registered and transferred, addresses, social security or taxpayer identification numbers of such persons,
and the principal amounts, maturities, and denominations of the exchange Bonds corresponding to ~uch persons.
The Paying Agent/Registrar will not accept any registration instructions after the five (5) day period. Otherwise, the
Initial Bonds will be transferred and exchanged in the ordinary course by the Paying Agent/Registrar. It is
understood that all costs and expenses for the shipping, packing, insuring and delivery of the exchange Bonds shall
be borne by the Initial Purchaser if the Initial Purchaser requests delivery of the exchange Bonds at any location
other than the principal corporate trust office of the Paying Agent/Registrar.
CUSIP Numbers... It is anticipated that CUSIP identification numbers will be printed on the Bonds, but neither the
failure to print such number on any Bond nor any error with respect thereto shall constitute cause for a failure or
refusal by the Initial Purchaser to accept delivery of and pay for the Bonds in accordance with the terms of this
OFFICIAL NOTICE OF SALE. CUSIP identification numbers will be made available to the Initial Purchaser at the
time the Bonds are awarded or as soon thereafter as practicable. The CUSIP Service Bureau charge for the
assignment of the numbers shall be the responsibility of and shall be paid by the Initial Purchaser.
Conditions to Delivery... The Initial Purchaser's obligation to accept delivery of and pay for the Bonds is subject to
the i~uanee of the legal opinion of thc Attorney General of Texas as to the legality o£ the Bonds, and the legal
opinion of Schwartz, Page & Harding, L.L.P. ("Bond Counsel"), the No-Litigation Certificate, and the non-
occurrence of the events indicated under "No Material Adverse Change" all as described below.
iv
Legal Opinions... The District will furnish to the Initial Purchaser a transcript of certain certified proceedings
incident to the issuance and authorization of the Bonds, including a certified copy of the approving legal opinion of
the Attorney General of Texas, as recorded in the Bond Register of the Comptroller of Public Accounts of the State
of Texas, to the effect that the Attorney General has examined a transcript of proceedings authorizing the issuance
of the Bonds, and that based upon such examination, the Bonds are valid and binding obligations of the District
payable from the proceeds of an annual ad valorem tax, levied without legal limitation as to rate or amount upon all
taxable property in the District. The District will also furnish the approving legal opinion of Schwartz, Page &
Harding, L.L.P., Bond Counsel, Houston, Texas, to the effect that, based upon an examination of such transcript, the
Bonds are valid and binding obligations of the District under the Constitution and laws of the State of Texas, except
to the extent that enforcement of the rights and remedies of the Registered Owners of the Bonds may be limited by
laws relating to bankruptcy, reorganization, or other similar laws of general application affecting the rights of
creditors of political subdivisions such as the District. The legal opinion of Bond Counsel will further state that the
Bonds are payable, both as to principal and interest, from the levy of ad valorem taxes without legal limitation as to
rate or amount, against taxable property within the District, and that the interest on the Bonds is excludable from
gross income for federal income tax purposes under statutes, regulations, published rulings and court decisions
existing on the date of such opinion assuming compliance by the District with certain covenants relating to the use
and investment of the proceeds of the Bonds. See "LEGAL MATTERS" in the Preliminary Official Statement.
Such opinions express no opinion with respect to the sufficiency of the security for or marketability of the Bonds.
The opinion of Bond Counsel is expected to be reproduced on the initial Bonds over a certification of the Secretary
of the Board of Directors attesting that such opinion was dated as of the date of delivery of and payment for the
Bonds and that such reproduction is a tree and correct copy of the original opinion. Errors or omissions in the
reproduction of such legal opinion on any Bond shall not affect the validity of the Bonds or constitute cause for a
failure or refusal by the Initial Purchaser to accept delivery of and pay for the Bonds.
Certification Regarding Offering Price of Bonds... In order to provide the District with information to enable it to
comply with certain conditions of the Internal Revenue Code of 1986 as amended (the "Code") relating to the
exclusion of interest on the Bonds from gross income for federal income tax purposes, the Initial Purchaser will be
required to complete, execute and deliver to the District (on or before the date of delivery of the Bonds) a
certification regarding "issue price" substantially in the form accompanying this Official Notice of Sale. If the
Initial Purchaser will not reoffer the Bonds for sale or has not sold a substantial amount of the Bonds of any
maturity by the date of delivery, such certificate may be modified in a manner approved by the District. In no event
will the District fail to deliver the Bonds as a result of the Initial Purchaser's inability to certify actual sales of Bonds
at a particular price prior to delivery. Each bidder, by submitting its bid, agrees to complete, execute and deliver
such a certificate by the date of delivery of the Bonds if its bid is accepted by the District. It will be the
responsibility of the Initial Purchaser to institute such syndicate reporting requirements, to make such investigation,
or otherwise to ascertain the facts necessary to enable it to make such certification with reasonable certainty. Any
question concerning such certification should be directed to Bond Counsel.
No-Litigation Certificate... The District will furnish the Initial Purchaser a certificate executed by both the
President or Vice President and Secretary or Assistant Secretary of the Board, dated as of the date of delivery of the
Bonds, to the effect that there is not pending, and, to their knowledge, there is not threatened, any litigation
affecting the validity of the Bonds, or the levy and/or collection of taxes for the payment thereof, or the organization
or boundaries of the District or the title of the officers thereof to their respective offices.
No Material Adverse Change... The obligation of the District to deliver the Bonds and of the Initial Purchaser to
accept delivery of and pay for the Bonds are subject to the condition that to the time of delivery of and receipt of
payment for the Bonds, there shall have been no material adverse change in the conditions of the District (financial
or otherwise) from those set forth in or contemplated by the PRELIMINARY OFFICIAL STATEMENT, as it may
have been supplemented or amended through the date of delivery.
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