R99-064 09-13-99RESOLUTION NO. R99-64
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PEARLAND,
TEXAS, APPROVING A BOND ORDER OF BRAZORIA COUNTY
MUNICIPAL UTILITY DISTRICT NO. 5 AUTHORIZING THE ISSUANCE OF
$2,300,000 UNLIMITED TAX BONDS, SERIES 1999.
WHEREAS, the Brazoria County Municipal Utility District No. 5 (the "District")
is located within the extraterritorial jurisdiction of the City of Pearland, Texas (the
"City"); and
WHEREAS, by Resolution No. R80-5, dated January 28, 1980, the City
consented to the creation of the District, and placed certain conditions on the issuance
of bonds by the District, including the approval by the City Council of the District's
resolution authorizing the issuance of such bonds; and
WHEREAS, the City Council has considered such a bond resolution in
connection with the issuance of the District's proposed $2,300,000 Unlimited Tax
Bonds, Series 1999, and has found it to be acceptable; now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS:
All of the matters and facts set forth in the preamble hereof are true
Section I.
and correct.
Section 2.
The bond order of the board of directors of Brazoria County
Municipal Utility District No. 5, attached hereto and made a part hereof as Exhibit "A",
authorizing the issuance of its $2,300,000 Unlimited Tax Bonds, Series 1999, is
hereby approved.
RESOLUTION NO. R99-64
Section 3. The Mayor of the City of Pearland is hereby authorized to execute
such letters or other documents required to be provided to the Attorney General of
Texas in connection with the issuance of such bonds by the District.
Section 4. This Resolution shall take effect immediately from and after its
passage in accordance with the provisions of the Charter of the City of Pearland and
it is accordingly so resolved.
PASSED, APPROVED
~'e_..~'FCrn It, P--A," , A. D., 1999.
and ADOPTED this the / ~"Y~ day of
TOM REID
MAYOR
ATTEST:
/Yi~TU~SECO~i~ARY
APPROVED AS TO FORM:
DARRIN M. COKER
CITY ATTORNEY
2
Exhibit "A"
[reso of MUD 5]
3
RESOLUTION AUTHORIZING THE ISSUANCE OF $2,300,000
UNLIMITED TAX BONDS, SERIES 1999; PRESCRIBING THE TERMS
AND PROVISIONS THEREOF; MAKING PROVISION FOR THE PAYMENT
OF THE iNTEREST THEREON AND THE PRINCIPAL THEREOF;
AUTHORIZING THE SALE THEREOF; AND CONTAINING OTHER
PROVISIONS RELATING TO THE SUBJECT
IT IS HEREBY ORDERED BY THE BOARD OF DIRECTORS OF BRAZORIA
COUNTY MUNICIPAL UTILITY DISTRICT NO. 5 THAT:
ARTICLE ONE
STATUTORY AUTHORITY, RECITALS AND FINDINGS
SECTION 1.01: AUTHORITY FOR THE DISTRICT. Brazoria County
Municipal Utility District No. 5 (the "District") of Brazoria
County, Texas, is a conservation and reclamation district created
pursuant to the provisions of Article XVI, Section 59, of the Texas
Constitution by order of the Texas Water Rights Commission dated
March 18, 1981, and confirmed at an election held within the
District on April 4, 1981.
SECTION 1.02.: PURPOSES OF THE DISTRICT. The District was
organized, created and established for the following purposes:
(a)
the control, storage, preservation, and distribution of
its storm water and floodwater, the water of its rivers
and streams for irrigation, power, and all other useful
purposes;
(b)
the reclamation and irrigation of its arid, semi-arid,
and other land needing irrigation;
(c)
the reclamation and drainage of its overflowed land and
other land needing drainage;
(d)
the conservation and development of its forests, water,
and hydroelectric power;
(e) the navigation of its inland and coastal water;
(f)
the control, abatement, and change of any shortage or
harmful excess of water;
(g)
the protection, preservation, and restoration of the
purity and sanitary condition of water within the state;
and
(h) the preservation of all natural resources of the state.
LLR\60809.1\BONDRESOLUTION2021
SECTION 1.03: POWERS OF THE DISTRICT. The District is
authorized to purchase, construct, acquire, own, operate, maintain,
repair, improve, or extend inside and outside its boundaries any
and all works, improvements, facilities, plants, equipment, and
appliances necessary to accomplish the purposes of its creation,
including all works, improvements, facilities, plants, equipment,
and appliances incident, helpful, or necessary to:
(a)
supply water for municipal uses, domestic uses, power,
and commercial purposes and all other beneficial uses or
controls;
(b)
collect, transport, process, dispose of, and control all
domestic, industrial, or communal wastes whether in
fluid, solid, or composite state;
(c)
gather, conduct, divert, and control local storm water or
other local harmful excesses of water in the District;
(d) irrigate the land in the District;
(e) alter land elevation in the District where it is needed;
(f) navigate coastal and inland waters of the District; and
(g) provide parks and recreational facilities for the
inhabitants in the District.
SECTION 1.04: AUTHORITY OF THIS RESOLUTION. The District is
authorized to issue bonds for the purposes of purchasing,
constructing, acquiring, owning, operating, repairing, improving,
or extending any District works, improvements, facilities, plants,
equipment, and appliances needed to accomplish the purposes, except
for the purpose of providing parks and recreation facilities, for
which the District was created, including works, improvements,
facilities, plants, equipment, and appliances needed to provide a
waterworks system, sanitary sewer system, and drainage system or
solid waste disposal system, or to make payment of sums due or to
become due under contracts for such purposes.
SECTION 1.05:
declared that:
FINDINGS.
It is hereby found, determined and
(a)
the matters and facts set out in this Article One are
true and correct;
(b)
at elections held on April 4, 1981, November 8, 1983, and
November 7, 1987, the District was authorized to issue
the bonds of the District in the maximum amount of
$23,775,000, for the purpose or purposes of purchasing,
constructing, acquiring, owning, operating, repairing,
improving, or extending a waterworks system, a sanitary
LLR\S0S09.1\BONDRESOLUTION2021 2
sewer system, and a drainage and storm sewer system for
the District and all additions to such systems and all
works, improvements, facilities, plants, equipment,
appliances, interests in property, and contract rights
needed therefor and administrative facilities needed in
connection therewith, and for refunding all or part of
the principal of or interest on the District's bonds, and
to provide for the payment of principal of and interest
on bonds by the levy and collection of a sufficient tax
upon all taxable property within said District;
(c)
the elections described in Paragraph (b) hereof were
called and held under and in strict conformity with the
Constitution and laws of the State of Texas, and of the
United States of America, and the Board of Directors has
heretofore officially declared the results of said
elections and declared that the District was legally
created and authorized to issue the bonds described in
Paragraph (b);
(d)
the District has heretofore issued to acquire and
construct various phases of a waterworks, sanitary sewer,
and drainage system for the District $1,735,000 Unlimited
Tax Bonds, Series 1982 (the "Series 1982 Bonds");
$2,750,000 Unlimited Tax Bonds, Series 1983 (the "Series
1983 Bonds"); $1,620,000 Unlimited Tax Bonds, Series 1984
(the "Series 1984 Bonds"); $6,065,000 Unlimited Tax
Refunding Bonds, Series 1992 (the "Series 1992 Refunding
Bonds"), to refund parts of the Series 1982 Bonds, the
Series 1983 Bonds, and the Series 1984 Bonds; $2,020,000
Unlimited Tax Bonds, Series 1995 (the "Series 1995
Bonds"); $1,980,000 Unlimited Tax Bonds, Series 1998 (the
"Series 1998 Bonds"); and $4,555,000 Unlimited Tax
Refunding Bonds, Series 1998A (the "Series 1998A
Refunding Bonds") to refund certain maturities of the
Series 1992 Refunding Bonds;
(e)
the District intends to issue $2,300,000 in bonds (the
"Bonds") to provide funds to reimburse a developer for
construction of water distribution, sanitary sewer
collection, and drainage facilities serving Southdown
Subdivision, Sections 8-11 and utilities along County
Road 94; to set aside funds for the District's share of
construction of water distribution, sanitary sewer
collection, and drainage facilities for Southdown
Subdivision, Sections 12 and 13; to finance the
District's share of water plant improvements and
detention pond rehabilitation; to finance a water line
replacement and improvements to lift station number two
in Southdown Subdivision; to pay certain engineering
costs associated with the design and construction of such
facilities; to pay interest on funds advanced to the
LLR\60809.1\BONDRESOLUTION2021 3
District; to set aside interest payments on the Bonds;
and to pay the costs of issuing the Bonds. As a result
of the issuance of the Bonds, the District's remaining
authorized but unissued bonds for the purposes of
financing improvements to the District's water, sewer,
and drainage systems or any other lawful purpose will be
$4,755,000;
(f)
the District has been authorized to levy taxes, and the
taxes to be collected will be sufficient to make the
principal and interest payments on the Bonds authorized
by this Resolution;
(g)
the Board of Directors reserves the right to issue the
remaining $4,755,000 in bonds which were voted on at the
election described in Paragraph (b) hereof in one or more
series at a future date or dates when, in the Board's
judgment, such amounts are required for the authorized
purposes.
ARTICLE TWO
DEFINITIONS AND INTERPRETATIONS
SECTION 2.01: DEFINITIONS. When used in this Resolution,
except in Article Five, and in any order amendatory or supplemental
hereto, the terms listed below shall have the meanings specified
below, unless it is otherwise expressly provided or unless the
context otherwise requires:
Additional Bonds.
The term "Additional Bonds" shall mean the additional bonds
which the District expressly reserves the right to issue in Section
9.01 of this Resolution.
Authorized Investments.
The term"Authorized Investments" shall mean all direct or
indirect obligations of the United States or one of its agencies,
the State of Texas, or any county, city, school district, or other
political subdivision of the State and certificates of deposit of
state or national banks or savings and loan associations within the
State provided that they are secured in the manner provided for the
security of the funds of counties of the State of Texas.
Board of Directors.
The term "Board of Directors" or "Board" shall mean the
governing body of the District.
LLR\60809.1\BONDRESOLUTION2021 4
Bondholders.
The term "Bondholder" or "Bondholders" shall mean the holder
or holders of a Bond or Bonds, as the context requires.
Bond Register.
The term "Bond Register" shall mean the books of registration
kept by the Paying Agent/Registrar in which are maintained the
papers and addresses of and the principal amount of the Bonds
Registered to'each Holder.
Bond Resolution.
The term "Bond Resolution" or "Resolution" shall mean this
Resolution and all amendments hereof and supplements hereto.
Bonds.
The term "Bond" or "Bonds" shall mean any obligation of the
District authorized and issued pursuant to this Resolution, whether
initially delivered or issued in exchange for, upon transfer of, or
in lieu of any Bond previously issued.
Business Day.
The term "Business Day" shall mean any day which is not a
Saturday, Sunday, legal holiday, or a day on which the Paying
Agent/Registrar is authorized by law or executive order to remain
closed.
Debt Service Fund.
The term "Debt Service Fund" shall mean the District's Debt
Service Fund which is established and affirmed in Section 7.01 of
this Resolution.
Definitive Bonds.
The term "Definitive Bond" or "Definitive Bonds" shall mean
the Initial Bond, as defined herein, as it may be transferred and
converted into or exchanged for fully registered Bonds in the
denomination of $5,000 or any integral multiple of $5,000.
Depository.
The term "Depository" shall mean the bank or banks which the
District may select from time to time as its depository or
depositories.
ua\e0e09. ~\sO~MSOn~xON202~ 5
Districti
The term "District" shall mean Brazoria County Municipal
Utility District No. 5 and any other public agency succeeding to
the powers, rights, privileges and functions of the District and,
when appropriate, the Board of Directors of the District.
Fiscal Year.
The term "Fiscal Year" shall mean the accounting period for
the District, which is currently the period ending September 30,
1998, and thereafter shall be the twelve-month period beginning on
October 1 of each year and ending on September 30 of the following
year, but which may be changed from time to time by the Board of
Directors.
Governmental Securities.
The term "Governmental Securities" shall mean direct
obligations of, or obligations the timely payment of the principal
of and interest on which are fully and unconditionally guaranteed
by, the United States of America.
Holders.
The term "Holder" or "Holders" when used with respect to any
Bond means the Person in whose name such Bond is registered in the
Bond Register.
Initial Bond.
The term "Initial Bond" shall mean the Bond authorized to be
issued hereunder which have the registration certificate executed
on behalf of the Comptroller of Public Accounts of the State of
Texas endorsed thereon, as contemplated by Section 5.07 hereof.
Initial Date.
The term "Initial Date" means October 1, 1999.
Interest Payment Date.
The term "Interest Payment Date" shall mean the Stated
Maturity of an installment of interest on any Bonds.
Maturity.
The term "Maturity" when used with respect to any Bond means
the date on which the principal of such Bond becomes due and
payable as therein and herein provided, whether at the Stated
Maturity or call for redemption.
LLR\60809.1\BONDRESOLUTION2021 6
Net Revenues.
The term "Net Revenues" shall mean the moneys received hy the
District from the ownership or operation of the District's
waterworks, sanitary sewer, drainage and storm sewer systems, as
well as under specific contracts, after deducting the costs of
operating, maintaining, and repairing the System and administration
of the District.
Outstandinq Bonds.
The term."Outstanding Bonds" shall mean the previously issued
bonds that remain outstanding, specifically the remaining
$1,125,000 principal amout of the Series 1992 Refunding Bonds;
$1,905,000 of the Series 1995 Bonds; $1,915,000 of the Series 1998
Bonds; $4,505,000 of the Series 1998A Refunding Bonds; and all of
the Bonds authorized by this Resolution.
Payinc Agent/Reqistrar.
The term "Paying Agent/Registrar" or "Registrar" means the
Person named as "Paying Agent/Registrar" herein until a successor
Paying Agent/Registrar shall have become such pursuant to the
applicable provisions of this Resolution, and thereafter "Paying
Agent/Registrar" shall mean such successor PayingAgent/Registrar.
Person.
The term "Person" means any individual, corporation,
partnership, joint venture, association, joint-stock company,
trust, unincorporated organization, or government or any agency or
political subdivision thereof.
Predecessor Bonds.
The term "Predecessor Bonds" of any particular Bond means
every previous Bond evidencing all or a portion of the same debt as
that evidenced by such particular Bond, and, for the purposes of
this definition, any Bond registered and delivered pursuant to
Section 3.08 in lieu of a mutilated, lost, destroyed, or stolen
Bond shall be deemed to evidence the same debt as the mutilated,
lost, destroyed, or stolen Bond.
Purchaser.
The term "Purchaser" has the meaning stated in Section 11.01.
Record Date.
The term "Record Date" for the interest payable on any
Interest Payment Date means the fifteenth (15th) day (whether or
LLR\60809.1\BONDRESOLUTION2021 7
not a business day) of the calendar month next preceding such
Interest Payment Date.
Redemption Date.
The term "Redemption Date," when used with respect to any Bond
to be redeemed, means the date fixed for such redemption pursuant
to the terms of this Resolution.
Redemption Price.
The term "Redemption Price" when used with respect to any Bond
to be redeemed means the price at which it is to be redeemed
pursuant to the terms of this Resolution, excluding installments of
interest whose Stated Maturity is on or before the Redemption Date.
Stated Maturity.
The term "Stated Maturity" when used with respect to any Bond
or any installment of interest thereon means the date specified in
such Bond as the fixed date on which the principal of such Bond or
such installment of interest is due and payable.
System.
The term "System" shall mean the District's waterworks,
sanitary sewer, drainage, and storm sewer systems presently
existing or to be constructed, all additions thereto, and all
works, improvements, facilities, plants, equipment, and appliances
connected therewith.
SECTION 2.02: INTERPRETATIONS. The titles and headings of
the articles and sections of this Resolution have been inserted for
convenience of reference only and are not to be considered a part
hereof and shall not in any way modify or restrict any of the terms
or provisions hereof. This Resolution and all the terms and
provisions hereof shall be liberally construed to effectuate the
purposes set forth herein and to sustain the validity of the Bonds
and the validity of the taxes levied in payment thereof.
ARTICLE THREE
AUTHORIZATION, DESCRIPTION, AND EXECUTION OF BONDS
SECTION 3.01: AMOUNT, NAME, PURPOSE AND AUTHORIZATION. The
Bonds of the District, to be known and designated as Brazoria
County Municipal Utility District No. 5 Unlimited Tax Bonds, Series
1999, shall be issued in the aggregate principal amount of Two
Million Three Hundred Thousand and No/100 Dollars ($2,300,000.00)
for the purposes of purchasing and constructing extensions and
additions to the District's existing water and sanitary sewer
system and drainage system and paying the costs of issuance of the
LLR\ 6 0 8 0 9.1 \BONDRESOLUT ION2 0 2 1 8
Bonds, in the form specified herein and bearing the terms herein
provided, under and in strict conformity with the Constitution and
laws of the State of Texas, particularly Section 59 of Article XVI
of the Constitution of Texas, and Chapters 49 and 54 of the Texas
Water Code, as amended.
SECTION 3.02: DATE, DENOMINATION, INTEREST RATE, AND
MATURITIES. The Bonds shall be issued in fully registered form in
the denomination of $5,000 or any integral multiple thereof. The
Initial Bond shall be dated October 1, 1999, and all Bonds
registered and delivered by the Paying Agent/Registrar shall be
dated October.l, 1999. The Bonds shall mature in the respective
principal amounts on September 1 of the respective years and bear
interest from the Initial Date until maturity or redemption at the
respective rates per annum set forth below:
Principal Year of Interest
Amount Maturity Rate
$ 50,000 2000
55,000 2001
60,000 2002
65,000 2003
65,000 2004
70,000 2005
75,000 2006
80,000 2007
85,000 2008
90,000 2009
90,000 2010
95,000 2011
95,000 2012
420,000 2013
445,000 2014
460,000 2015
SECTION 3.03: INTEREST PAYMENT DATES. The interest on the
Bonds shall be payable on September 1, 2000, and semiannually
thereafter on March 1 and September 1 of each year until the
maturity or redemption date of the Bonds. The amount of interest
on the Bonds payable on each Interest Payment Date shall be
computed on the basis of a 360-day year of twelve 30-day months.
SECTION 3.04: MEDIUMAND PLACE OF PAYMENT. The Bonds shall
be payable without exchange or collection charges, in any coin or
currency of the United States of America which on the respective
dates of payment is legal tender for the payment of debts due the
United States of America, upon presentation and surrender of the
certificate representing the Bonds as they become due, or at
LLR\60809.1\BONDRESOLUTION2021 9
their earliest redemption date, at the principal trust office of
the Paying Agent/Registrar.
SECTION 3.05: EXECUTION OF BONDS. The Bonds shall be
signed by the President or Vice President and attested by the
Secretary or Assistant Secretary of the Board of Directors by the
manual. or facsimile signatures, and the official seal of the
District shall be impressed or placed in facsimile thereon. The
facsimile signatures on the Bonds shall have the same effect as
if the Bonds had been signed manually and in person, and the
facsimile seal on the Bonds shall have the same effect as if the
official seal of the District had been manually impressed upon
each of the Bonds. Bonds bearing the manual or facsimile
signatures of individuals who were at the time the proper
officers of the District shall bind the District, notwithstanding
that such individuals or either of them shall cease to hold such
offices prior to the certification or registration and delivery
of such Bonds or shall not have held such offices at the date of
such Bonds, all as provided in the Bond Procedures Act of 1981,
as amended. Any Bond may be signed on behalf of the District by
the actual or facsimile signature of such person as, at the
actual time of execution of such Bond, shall be the proper
officer of the District, although at the time of the Initial Date
of the Bonds or the adoption of this Resolution, any such person
was not said officer. Minor typographical and other minor errors
in the text of any Bond or minor defects in the seal or facsimile
signature on any Bond shall not affect the validity or
enforceability of such Bond if it has been duly authenticated by
the Paying Agent/Registrar.
SECTION 3.06: PAYING AGENT/REGISTRAR. The District shall
at all times maintain a Paying Agent/Registrar meeting the
qualifications herein described, for the performance of the
duties hereunder. Chase Bank of Texas National Association in
Dallas, Texas, is hereby appointed Paying Agent/Registrar for
such purposes. The District reserves the right to appoint a
successor Paying Agent/Registrar by (a) filing with the Person
then performing such function a certified copy of a resolution or
ordinance giving notice of the termination of the Agreement and
appointing a successor, and (b) causing notice to be given to
each Bondholder and the Municipal Advisory Council of Texas.
Every Paying Agent/Registrar appointed hereunder shall at all
times be a corporation organized and doing business under the
laws of the United States of America or of any State, authorized
under such laws to exercise trust powers, and subject to
supervision or examination by Federal or State authority. The
form of agreement submitted by the Person named above as Paying
Agent/Registrar is hereby approved, and an appropriate official
of the District is hereby authorized to execute such agreement
for and on behalf of the District.
LLR\60809.1\BONDRESOLUTION2021 10
SECTION 3.07: REGISTRATION, DELIVERY, AND TRANSFER OF
BONDS. Initially one Bond (the "Initial Bond") representing the
entire principal amount of the Bonds shall be issued in the name
of the Purchaser (as defined herein), or its designee, executed
and submitted to the Attorney General of Texas for approval, and
thereupon certified by the Comptroller of Public Accounts of the
State of Texas by manual signature of an appropriate official in
such office. At any time thereafter the Holder may deliver the
Initial Bond to the Paying Agent/Registrar for transfer or
exchange, accompanied by instruction from the Purchaser or such
designee designating the Persons, maturities, and principal
amounts to and in which the Initial Bond is to be transferred or
exchanged and the addresses of such Persons, and the Paying
Agent/Registrar shall thereupon, within not more than three (3)
Business Days, register and deliver Definitive Bonds upon
authorization of the District as provided in such instructions.
In the event that the Purchaser provides written instructions to
the Paying Agent/Registrar at least five (5) Business Days prior
to the date of delivery of the Initial Bond to the Purchaser,
then the Paying Agent/Registrar shall transfer or exchange
Definitive Bonds for the Initial Bond on the date of delivery
upon payment for and surrender for exchange or transfer of the
Initial Bond by the Purchaser. No Bond shall be entitled to any
right or benefit under this Resolution, or be valid or obligatory
for any purpose, unless there appears on such Bond either a
certificate of registration substantially in the form provided in
Section 5.03, executed by the Comptroller of Public Accounts of
the State of Texas or his duly authorized agent by manual
signature, or a certificate of registration substantially in the
form provided in Section 5.04, as appropriate, executed by the
Paying Agent/Registrar by manual signature, and either such
certificate upon any Bond shall be conclusive evidence, and the
only evidence, that such Bond has been duly certified or
registered and delivered. The District shall cause to be kept at
the principal office of the Paying Agent/Registrar a register
(herein referred to as the "Bond Register") in which, subject to
such reasonable regulations as it may prescribe, registration of
the Bonds and of transfers of the Bonds shall be made as provided
herein. Upon surrender for transfer of any Bond at the principal
payment office of the PayingAgent/Registrar, the District shall
execute and the Paying Agent/Registrar shall register and
deliver, in the name of the designated transferee or transferees,
one or more new Bonds of the same Stated Maturity, of any
authorized denominations, bearing the same rate of interest, and
of like aggregate principal amount, upon surrender of the Bond to
be exchanged at the principal payment office of the Paying
Agent/Registrar. Whenever any Bonds are so surrendered for
exchange, the District shall execute, and the Paying
Agent/Registrar shall register and deliver, the Bonds which the
Holder of Bonds making the exchange is entitled to receive. All
Bonds issued upon any transfer or exchange of Bonds shall be the
valid obligations of the District, evidencing the same debt, and
LLR\60809.1\BONDRa~SOLUTION2021 11
entitled to the same benefits under this Resolution, as the Bonds
surrendered upon such transfer or exchange. Every Bond presented
or surrendered for transfer or exchange shall be duly endorsed or
be accompanied by a written instrument of transfer in form
satisfactory to the Payin9 Agent/Registrar duly executed by the
Holder thereof or his attorney duly authorized in writin9. No
service charge shall be made to the Holder for any registration,
transfer, or exchange of Bonds, but the District or the Payin9
Agent/Registrar may require payment of a sum sufficient to cover
any tax or other 9overnmental charge that may be imposed in
connection with any transfer or exchange of Bonds. Neither the
District nor the PayingAgent/Registrar shall be required (a) to
issue, transfer or exchange any Bond durin9 the period beginnin9
at the openin9 of business on a Record Date and endin9 at the
close of business on the next succeedin9 Interest Payment Date,
or (b) to transfer or exchange any Bond selected for redemption
in whole or in part where such redemption is scheduled to occur
within thirty (30) calendar days.
SECTION 3.08: MUTILATED, DESTROYED, LOST, AND STOLEN BONDS.
If (a) any mutilated Bond is surrendered to the Payin9
Agent/Registrar, or the District and the Payin9 Agent/Registrar
receive evidence to their satisfaction of the destruction, loss,
or theft of any Bond, and (b) there is delivered to the District
and the PayingAgent/Registrar such security or indemnity as may
be required by them to save each of them harmless, then, in the
absence of notice to the District or the Payin9 Agent/Registrar
that such Bond has been acquired by a bona fide purchaser, the
District shall execute and upon its request the Paying
Agent/Registrar shall register and deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost, or stolen Bond, a
new Bond of the same Stated Maturity and of like tenor and
principal amount, bearin9 a number not contemporaneously
outstanding. In case any such mutilated, destroyed, lost, or
stolen Bond has become or is about to become due and payable, the
District in its discretion may, instead of issuing a new Bond,
pay such Bond. Upon the issuance of any new Bond under this
Section, the District may require the payment by the Holder of a
sum sufficient to cover any tax or other 9overnmental charge that
may be imposed in relation thereto and any other expenses
(includin9 the fees and expenses of the Payin9 Agent/Registrar,
bond printing, and legal fees) connected therewith. Every new
Bond issued pursuant to this Section in lieu of any mutilated,
destroyed, lost, or stolen Bond shall constitute a replacement of
the prior obligation of the District, whether or not the
mutilated, destroyed, lost, or stolen Bond shall be at any time
enforceable by anyone, and shall be entitled to all the benefits
of this Resolution equally and ratably with all other outstanding
bonds. The procedures set forth in the Payin9 Agent/Registrar
Agreement, approved in Section 3.06 hereof, shall also be
available with respect to mutilated, destroyed, lost, or stolen
Bonds. The provisions of this Section are exclusive and shall
LLR\60S09.1\BONDRESOLUTION2021 12
preclude (to the extent lawful) all other rights and remedies
with respect to the replacement and payment of mutilated,
destroyed, lost, or stolen Bonds.
SECTION 3.09: CANCELLATION. All bonds surrendered for
payment, redemption, transfer, exchange, or replacement, if
surrendered to the Payin9 A~ent/Registrar, shall be promptly
cancelled by it and, if surrendered to the District, shall be
delivered to the Payin~ Agent/Registrar and, if not already
cancelled, shall be promptly cancelled by the Payin~
Agent/Registrar. The District may at any time deliver to the
Payin~ Agent/Registrar for cancellation any Bonds previously
certified or registered and delivered which the District may have
acquired in any manner whatsoever, and all Bonds so delivered
shall be promptly cancelled by the PayingAgent/Registrar. All
cancelled Bonds held by the Paying A~ent/Re~istrar shall be
disposed of as directed by the District.
ARTICLE FOUR
REDEMPTION OF BONDS BEFORE MATURITY
SECTION 4.01: REDEMPTION OF BONDS. The District reserves
the right to redeem the Bonds maturin9 on September 1, 2007, or
thereafter, prior to their scheduled maturities, in whole, or
from time to time in part, in such manner as the District may
determine, in integral multiples of $5,000, on September 1, 2006,
or on any date thereafter, at a price equal to the principal
amount of the Bonds to be redeemed plus accrued interest thereon
to the date fixed for redemption.
SECTION 4.02: NOTICE TO PAYING AGENT/REGISTRAR OF
REDEMPTION. The exercise by the District of its option to redeem
any Bonds shall be entered in the minutes of the Board of
Directors of the District. The District shall, at least forty-
five (45) days prior to the Redemption Date (unless a shorter
notice shall be satisfactory to the Payin9 A~ent/Re~istrar),
notify the Paying A~ent/Re~istrar of such Redemption Date and of
the principal amount of Bonds of each Stated Maturity to be
redeemed.
SECTION 4.03: MANNER OF REDEMPTION. If less than all of
the Outstandin~ Bonds of the same Stated Maturity are to be
redeemed, the particular Bonds to be redeemed shall be selected
by the Registrar by lot or other random method from the Bonds
which have not previously been called for redemption. The
District shall promptly notify the Payin9 Agent/Registrar in
writin9 of the Bonds selected for redemption and, in the case of
any Bond selected for partial redemption, the principal amount
thereof to be redeemed. For purposes of this Resolution, unless
the context otherwise requires, all provisions relating to the
redemption of Bonds shall relate, in the case of any Bond
I.,I.2R\60809. l\BONDRIi/SOI~UTION2021 13
redeemed or to be redeemed only in part, to the portion of the
principal of such Bond which has been or is to be redeemed.
SECTION 4.04: NOTICE TO HOLDERS OF REDEMPTION. Notice of
redemption shall be mailed by the Payin9 Agent/Registrar in the
name of and at the expense of the District, not less than thirty
(30) days prior to the Redemption Date, to each Holder of Bonds
to be redeemed. All notices of redemptions shall include a
statement as to (a) the Redemption Date, (b) the Redemption
Price, (c) the principal amount of the Bonds to be redeemed and,
if less than all Bonds are to be redeemed, the identification
(and, in the case of partial redemption, the respective principal
amounts) of the Bonds to be redeemed, (d) that on the Redemption
Date the Redemption Price of each of the Bonds to be redeemed
will become due and payable and that interest thereon shall cease
to accrue from and after such date, and (e) that such Bonds are
to be surrendered for payment of the Redemption Price at the
principal payment office of the Payin9 Agent/Registrar, and the
address of such office.
SECTION 4.05: PAYMENT FOR REDEEMED BONDS. Notice of
redemption havin9 been 9iven as aforesaid, the Bonds so to be
redeemed shall, on the Redemption Date, become due and payable at
the Redemption Price, and from and after such date (unless the
District shall default in the payment of the Redemption Price)
such Bonds shall cease to bear interest. Upon the surrender of
such Bonds for redemption in accordance with such notice, such
Bonds shall be paid by the Payin9 Agent/Registrar at the
Redemption Price out of money supplied by the District.
Installments of interest with a Stated Maturity on or prior to
the RedemptiOn Date shall be payable to the Holders of such Bonds
registered as such on the relevant Record Dates accordin9 to
their terms. If any Bond called for redemption shall not be so
paid on the date set for redemption by reason of the failure of
the District to provide collected funds, the same shall continue
to bear interest from the Redemption Date at the rate borne by
such Bond.
SECTION 4.06: PARTIAL REDEMPTION. Any Bond which is to be
redeemed only in part shall be surrendered at the office of the
Payin9 Agent/Registrar (if payment is to be made to other than
the registered Holder with due endorsement by, or a written
instrument of transfer in form satisfactory to the Paying
Agent/Registrar duly executed by, the Holder thereof or his
attorney duly authorized in writing), and the District shall
execute and the PayingAgent/Registrar shall register and deliver
to the Holder of such Bond, without service charge to the Holder,
a new Bond or Bonds of the same Stated Maturity and of any
authorized denomination or denominations as requested by such
Holder in aggregate principal amount equal to and in exchange for
the unredeemed portion of the principal of the Bond so
surrendered.
LLR\60809.1\BONDRESOLUTION2021 14
ARTICLE FIVE
FORM OF BONDS AND CERTIFICATES
SECTION 5.01: FORMS GENERALLY. The Bonds, the Registration
Certificates of the Comptroller of Public Accounts of the State
of Texas, the Certificates of Registration, the legend to be
placed on the Bonds relating to municipal bond guaranty
insurance, and the form of Assignment to be printed on each of
the Bonds shall be substantially in the forms set forth in this
Article with such appropriate insertions, omissions,
substitutions, and other variations as are permitted or required
by this Resolution, and may have such letters, numbers, or other
marks of identification (including identifying numbers and
letters of the Committee on Uniform Securities Identification
Procedures of the American Bankers Association ["CUSIP"]) and
such legends and endorsements (including any reproduction of any
opinion of counsel) thereon as may, consistently herewith, be
established by the District or determined by the officers
executing such Bonds as evidenced by their execution thereof.
Any portion of the text of any Bonds may be set forth on the
reverse thereof, with an appropriate reference thereto on the
face of the Bond. The Definitive Bonds shall be printed,
lithographed, or engraved, produced by any combination of these
methods, or produced in any other similar manner, all as
determined by the officers executing such Bonds as evidenced by
their execution thereof, but the Initial Bond submitted to the
Attorney General of Texas may be typewritten or photocopied or
otherwise reproduced.
SECTION 5.02: FORM OF BONDS. The Bonds authorized by this
Resolution shall be in substantially the following form, with
such omissions, insertions, and variations as may be necessary
and desirable and consistent with the terms of this Resolution:
LLR\60809.1\BONDRESOLUTION2021 15
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF BRAZORIA
REGISTERED
NUMBER
REGISTERED
AMOUNT
$
BRAZORIA COUNTY MUNICIPAL UTILITY DISTRICT No. 5
UNLIMITED TAX BOND
SERIES 1999
Interest Rate:
Stated Maturity:
Initial Date:
October 1, 1999
CUSIP:
BRAZORIA COUNTY MUNICIPAL UTILITY DISTRICT No. 5, a
conservation and reclamation district, a body politic and
corporate and a governmental agency created under the
Constitution and laws of the State of Texas, situated in Brazoria
County, Texas (herein, the "District"), FOR VALUE RECEIVED hereby
acknowledges itself indebted to and PROMISES TO PAY TO
(the "Holder"), or registered assigns, on the Stated Maturity
specified above, the sum of
DOLLARS
(or so much thereof as shall not have been paid upon prior
redemption) and to pay interest thereon from the later of the
Initial Date or the most recent Interest Payment Date to which
interest has been paid or duly provided for, on September 1,
2000, and thereafter semiannually on September 1 and March I in
each year, at the per annum rate of interest specified above,
computed on the basis of a 360-day year of twelve 30-day months.
The principal of this Bond is payable at the agency of the
District, which shall be the principal payment office of the
Paying Agent/Registrar executing the registration certificate
appearing hereon, upon presentation and surrender of this Bond.
The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date will be paid to the person in
whose name this Bond (or one or more Predecessor Bonds, as
defined in the Resolution hereinafter defined), is registered at
the close of business on the Record Date for such interest, which
shall be the fifteenth (15th) day of the month next preceding
such Interest Payment Date. All such payments may be made by the
Paying Agent/Registrar by check dated as of the Interest Payment
Date and mailed to the registered Holder.
ma\eosos. Z\9OZ,TD~aSOx.U~zOz~=O=Z 16
THE DATE OF THE INITIAL BOND OF THIS ISSUE, in conformity
with the Resolution authorizing the issuance of the series of
Bonds of which this Bond is a part (herein the "Resolution',), is
October 1, 1999.
THIS BOND IS ONE OF ANAUTHORIZED ISSUE OF BONDS, designated
Brazoria County Municipal Utility District No. 5 Unlimited Tax
Bonds, Series 1999 (hereinafter sometimes called the "Bonds")
aggregating Two Million Three Hundred Thousand and No/100 Dollars
($2,300,000.00). The Bonds are issued for the purpose of
purchasing and constructing extensions of and additions to the
District's existing water and sanitary sewer system and drainage
system, and paying the costs of issuance of the Bonds, all under
and in strict conformity with the Constitution and laws of the
State of Texas, particularly Section 59 of Article XVI of the
Constitution of Texas, and Chapters 49 and 54, Texas Water Code,
as amended.
THE DISTRICT RESERVES THE RIGHT TO REDEEM the Bonds of this
issue maturing on September 1, 2007, or thereafter, prior to
their scheduled maturities, in whole, or from time to time in
part, in such manner as the District may determine, in integral
multiples of $5,000, on September 1, 2006, or on any date
thereafter, at a price equal to the principal amount of the Bonds
to be redeemed plus accrued interest thereon to the date fixed
for redemption.
AS PROVIDED IN THE BOND Resolution and subject to certain
limitations therein set forth, this Bond is transferable on the
Bond Register of the District, upon surrender of this Bond for
transfer at the principal payment office of the Paying
Agent/Registrar, duly endorsed by or accompanied by a written
instrument of transfer in form satisfactory to the Paying
Agent/Registrar duly executed by the registered Holder hereof or
his attorney duly authorized in writing, and thereupon one or
more new fully registered Bonds of the same Stated Maturity, of
authorized denominations, bearing the same rate of interest, and
for the same aggregate principal amount will be issued to the
designated transferee or transferees.
NEITHER THE DISTRICT NOR THE PAYING AGENT/REGISTRARshall be
required (i) to issue, transfer, or exchange any Bond during a
period beginning at the opening of business on a Record Date and
ending at the close of business on the next succeeding Interest
Payment Date, or (ii) to transfer or exchange any Bond so
selected for redemption in whole or in part when such redemption
is scheduled to occur within forty-five (45) calendar days.
THE DISTRICT, THE PAYING AGENT/REGISTRAR, and any agent of
either of them may treat the person in whose name this Bond is
registered as the owner hereof for the purpose of receiving
payment as herein provided and for all other purposes, whether or
not this Bond be overdue, and neither the District, the Paying
LLR\60809.1\BONDRESOLUTION2021 17
Agent/Registrar, nor any such agent shall be affected by notice
to the contrary.
THIS BOND, AND THE OTHER BONDS OF THE SERIES OF WHICH IT IS
A PART, is payable from the proceeds of a continuing, direct
annual ad valorem tax levied, without limit as to rate or amount,
upon all taxable property within the District. Reference is made
to the Resolution for a more complete description of the funds
charged with and pledged to the payment of this Bond and the
series of which it is a part. By acceptance of this Bond, the
Holder hereof expressly assents to all of the provisions of the
Resolution.
IN ADDITION TO THE RIGHT TO ISSUE BONDS OF INFERIOR LIEN,
the District has reserved the right to issue Additional Bonds, as
defined in the Resolution, which may be secured by a lien on and
pledge of the Net Revenues resulting from the ownership or
operation of the District's waterworks, sanitary sewer, and
drainage and storm sewer system. Such Additional Bonds may be
payable solely from such revenues or solely from taxes or may be
payable from a combination of taxes and such revenues. The
District has also reserved the right to issue Special Project
Bonds, as defined in the Resolution, which will be payable from
and secured .by the proceeds of a contract or contracts with
persons, corporations, municipal corporations, political
subdivisions, or other entities. Reference is made to the
Resolution for a complete description of the right to issue
Additional Bonds and Special Project Bonds.
IT IS HEREBY CERTIFIED, RECITED, AND REPRESENTED that the
issuance of this Bond and the series of Bonds of which it is a
part is duly authorized by law; that all acts, conditions, and
things required to exist and to be done precedent to and in the
issuance of this Bond and said series of Bonds to render the same
lawful and valid have been properly done and performed and have
happened in regular and due time, form, and manner as required by
law; that due provision has been made for the payment of the
interest on and the principal of this Bond and the series of
Bonds of which it is a part by levy of a continuing, direct
annual ad valorem tax upon all taxable property within the
District sufficient for said purposes; and that the issuance of
this series of Bonds does not exceed any Constitutional or
statutory limitation.
IN WITNESS WHEREOF, BRAZORIA COUNTY MUNICIPAL UTILITY
DISTRICT No. 5 has caused this Bond to be executed by the
facsimile signatures of the President and Secretary of its Board
of Directors and its official seal to be impressed or placed in
facsimile hereon, all as of the 1st day of October, 1999.
LLR\60809.1\BONDRESOLUTION2021 18
BRAZORIA COUNTY MUNICIPAL
UTILITY DISTRICT No. 5
By:
President, Board of Directors
ATTEST:
Secretary, Board of Directors
(SEAL)
SECTION 5.03: FORM OF REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS. The Initial Bond shall be
registered by the Comptroller of Public Accounts of the State of
Texas as provided by law. The registration certificate of said
Comptroller of Public Accounts shall be printed on the back of
said Initial Bond in substantially the following form:
OFFICE OF THE COMPTROLLER §
OF PUBLIC ACCOUNTS
REGISTER NO.
STATE OF TEXAS
I HEREBY CERTIFY THAT there is on file and of record in my
office a certificate to the effect that the Attorney General of
the State of.Texas has approved this Bond, and further that this
Bond has been registered this day by me.
WITNESS my signature and seal of office this
, 1999.
day of
(COMPTROLLER'S SEAL)
Comptroller of Public Accounts
of the State of Texas
SECTION 5.04: FORM OF AUTHENTICATION CERTIFICATE OF PAYING
AGENT/REGISTRAR. On the front of all Bonds other than the
Initial Bond, the Authentication Certificate of the Paying
Agent/Registrar shall be printed in substantially the following
form:
AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been delivered
pursuant to the Bond Resolution described in the text of this
Bond, in exchange for or in replacement of a bond, bonds, or a
portion of a bond approved by the Attorney General of the State
of Texas and registered by the Comptroller of Public Accounts of
the State of Texas.
Chase Bank of Texas, National
Association
Date of Authentication:
By:
Authorized Signature
SECTION 5.05: FORM OF ASSIGNMENT. On the back of all Bonds
other than the Initial Bond, the Form of Assignment shall be
printed in substantially the following form:
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns,
and transfers unto (Print or typewrite name, address, and zip
code of Transferee):
(Social Security or other identifying number of Transferee:
) the within Bond and all rights thereunder,
and hereby irrevocably constitutes and appoints
as attorney to transfer the
within Bond on the books kept for registration thereof, with full
power of substitution in the premises.
Dated:
Registered Owner (s)
NOTICE: The signature(s) on this
assignment must correspond with
the name(s) of the registered
Holder(s) as shown on the face of
this Bond in every particular,
without enlargement or change
whatsoever.
LLR\60809.1\BONDRESOLUTION2021 2 0
Signature Guaranteed
NOTICE: Signature(s) must be
guaranteed by a member firm of the
New York Stock Exchange or a
commercial bank or trust company.
The following abbreviations, when used in the inscription on
the face of the within Bond or above Assignment, shall be construed
as though they were written out in full according to applicable
laws or regulations:
TEN COM -- as'tenants
in common
UNIF GIFT MIN ACT
Custodian
(Cust.)
(Minor)
TEN ENT -- as tenants by
the entireties
JT TEN
-- as joint tenants
with rights of
survivorship and
not as tenants
in common
under Uniform Gifts to Minors Act
State
Additional abbreviations may also be used though not in the above
list.
SECTION 5.06: INSURANCE STATEMENT. On the back of all Bonds,
the following statement of insurance shall be printed:
STATEMENT OF INSURANCE
MBIA Insurance Corporation (the "Insurer") has issued a policy
containing the following provisions, such policy being on file at
Chase Bank of Texas National Association, Houston, Texas.
The Insurer, in consideration of the payment of the premium
and subject to the terms of this policy, hereby unconditionally and
irrevocably guarantees to any owner, as hereinafter defined, of the
following described obligations, the full and complete payment
required to be made by or on behalf of the Issuer to Chase Bank of
Texas National Association or its successor (the "PayingAgent,,) of
an amount equal to (i) the principal of (either at the stated
maturity or by any advancement of maturity pursuant to a mandatory
sinking fund payment) and interest on, the Obligations (as that
term is defined below) as such payments shall become due but shall
not be so paid (except that in the event of any acceleration of the
due date of such principal by reason of mandatory or optional
redemption or acceleration resulting from default or otherwise,
other than any advancement of maturity pursuant to a mandatory
LLR\60S09.1\BONDRESOLUTION2021 2 1
sinking fund payment, the payments guaranteed hereby shall be made
in such amounts and at such times as such payment of principal
would have been due had there not been any such acceleration); and
(ii) the reimbursement of any such payment which is subsequently
recovered from any owner pursuant to a final judgment by a court of
competent jurisdiction that such payment constitutes an avoidable
preference to such owner within the meaning of any applicable
bankruptcy law. The amounts referred to in clauses (i) and (ii) of
the preceding sentence shall be referred to herein collectively as
the "Insured Amounts." "Obligations" shall mean:
$2,300,000
BRAZORIA COUNTY MUNICIPAL UTILITY DISTRICT NO. 5
UNLIMITED TAX BONDS
SERIES 1999
Upon receipt of telephonic or telegraphic notice, such notice
subsequently confirmed in writing by registered or certified mail,
or upon receipt of written notice by registered or certified mail,
by the Insurer from the Paying Agent or any owner of an Obligation
the payment of an Insured Amount for which is then due, that such
required payment has not been made, the Insurer on the due date of
such payment or within one business day after receipt of notice of
such nonpayment, whichever is later, will make a deposit of funds,
in an account with State Street Bank and Trust Company, N.A., in
New York, New York, or its successor, sufficient for the payment of
any such Insured Amounts which are then due. Upon presentment and
surrender of such Obligations or presentment of such other proof of
ownership of~ the Obligations, together with any appropriate
instruments of assignment to evidence the assignment of the Insured
Amounts due on the Obligations as are paid by the Insurer, and
appropriate instruments to effect the appointment of the Insurer as
agent for such owners of the Obligations in any legal proceeding
related to payment of Insured Amounts on the Obligations, such
instruments being in a form satisfactory to State Street Bank and
Trust Company, N.A., State Street Bank and Trust Company, N.A.
shall disburse to such owners or the Paying Agent payment of the
Insured Amounts due on such Obligations, less any amount held by
the Paying Agent for the payment of such Insured Amounts and
legally available therefor. This policy does not insure against
loss of any prepayment premium which may at any time be payable
with respect to any Obligation.
As used herein, the term "owner" shall mean the registered
owner of any Obligation as indicated in the books maintained by the
Paying Agent, the Issuer, or any designee of the Issuer for such
purpose. The term owner shall not include the Issuer or any party
whose agreement with the Issuer constitutes the underlying security
for the Obligations.
Any service of process on the Insurer may be made to the
Insurer at its offices located at 113 King Street, Armonk, New York
10504 and such service of process shall be valid and binding.
LLR\e08Og. 1\BONDRESOLUTION2021 2 2
This policy is non-cancellable for any reason. The premium on
this policy is not refundable for any reason including the payment
prior to maturity of the Obligations.
DISCLOSURE OF GUARANTY FUND NONPARTICIPATION: In the event the
Insurer is unable to fulfill its contractual obligation under this
policy or contract or application or certificate or evidence of
coverage, the policyholder or certificateholder is not protected by
an insurance guaranty fund or other solvency protection
arrangement.
MBIA INSURANCE CORPORATION
SECTION 5.07: FORM OF INITIAL BOND. The Initial Bond shall
be in the form set forth in Section 5.02 of this Article, except
that:
(a)
immediately under the name of the bond the headings
"Interest Rate" and "Stated Maturity" and "CUSIP" shall
all be eliminated.
(b) in the first paragraph:
(i) the words "on the Stated Maturity specified
above" shall be deleted and the followinq will be
inserted: "on the first day of September in ~ach of the
years indicated below and bearing interest at the per
annum rates in accordance with the following schedule:
Principal Year of Interest
Amount Maturity Rate
[Information to be inserted from schedules in Section 3.02 hereof,
incorporating the Principal Amount, Year of Maturity, and Interest
Rate of the Bonds.]
(ii) the words "executing the registration
certificate appearing hereon" shall be deleted and an
additional sentence shall be added to the paragraph as
follows: "The initial Paying Agent/Registrar is Chase
Bank of Texas National Association, Dallas, Texas."
(iii) the words "(or one or more Predecessor Bonds,
as defined in the Resolution hereinafter defined)" shall
be deleted.
(c) the Initial Bond for the Bond shall be numbered T-1.
(d)
the adjective "facsimile" modifying the noun "signatures,,
in the last paragraph shall be deleted.
SECTION 5.08: CUSIP REGISTRATION. The President of the Board
of Directors or the PayingAgent/Registrar may secure the printing
ma\e0a09. ~\BO~DR~.SOLU~ON202~ 2 3
of identification numbers on the front of the Bonds through the
CUSIP Service Bureau Division of Standard & Poors Corporation, New
York, New York.
SECTION 5.09: LEGAL OPINION. The approving opinion of Coats,
Rose, Yale, Ryman & Lee, P.C., Houston, Texas, bond counsel, may be
printed on the back of the Bonds over the certification of the
Secretary of the Board of Directors which may be executed in
facsimile.
ARTICLE SIX
SECURITY OF THE BONDS
SECTION 6.01: SECURITY OF BONDS. The Bonds are secured by
and payable from the levy of a continuing, direct annual ad valorem
tax, without limit as to rate or amount, upon all taxable property
within the District.
SECTION 6.02: LEVY OF TAX. To pay the interest on the Bonds,
and to create a sinking fund for the payment of the principal
thereof when due, and to pay the expenses of assessing and
collecting such taxes, there is hereby levied, and shall be
assessed and collected in due time, a continuing, direct annual ad
valorem tax, without limit as to rate or amount, on all taxable
property in the District for each year while any of the Bonds are
outstanding. All of the proceeds of such collections, except
expenses incurred in that connection, shall be paid into the Debt
Service Fund, and the aforementioned tax and such payments into
such fund shall continue until the Bonds and the interest thereon
have been fully paid and discharged, and such proceeds shall be
used for such purposes and no other. While said Bonds, or any of
them, are outstanding and unpaid, an ad valorem tax each year at a
rate from year to year as will be ample and sufficient to provide
funds to pay the interest on said Bonds and to provide the
necessary sinking fund to pay the principal when due, full
allowance being made for delinquencies and costs of collection,
shall be levied, assessed, and collected and applied to the payment
of principal and interest on the Bonds. In determining the amount
of taxes which should be levied each year, the Board may consider
whether proceeds from the sale of Bonds have been placed in escrow
to pay interest during construction and whether the Board
reasonably expects to have revenue or receipts available from other
sources which are legally available to pay principal of or interest
or redemption price on the Bonds.
SECTION 6.03: CONSOLIDATION OF DISTRICT. The laws of the
State of Texas permit the District to be consolidated with one or
more conservation and reclamation districts. In the event the
District is consolidated with another district or districts, the
District reserves the right to:
(a)
consolidate the System with a similar system of one or
more districts with which the District is consolidating
and operate and maintain the systems as one consolidated
system (herein for purposes of this section the
"Consolidated System");
(b)
apply the net revenues from the operation of the
Consolidated System to the payment of principal,
interest, redemption price, and bank charges on the
revenue bonds or the combination tax and revenue bonds
(herein for purposes of this section the "Revenue Bonds")
of the District and of the district or districts with
which the District is consolidating (herein collectively
the "Consolidating Districts") without preference to any
series of bonds (except subordinate lien revenue bonds
which shall continue to be subordinate to the first lien
revenue bonds of the Consolidating Districts); and
(c)
pledge the net revenues of the Consolidated System to the
payment of principal, interest, redemption price, and
bank charges on revenue bonds which may be issued by the
Consolidating Districts on a parity with the outstanding
first lien revenue bonds of the Consolidating Districts.
ARTICLE SEVEN
FLOW OF FUNDS AND INVESTMENTS
SECTION 7.01: CREATION OF FUNDS. The establishment of the
Debt Service Fund is hereby affirmed. Such fund shall be kept
separate and apart from all other funds of the District. The Debt
Service Fund shall constitute a trust fund which shall be held in
trust for the benefit of the Bondholders and, to the extent
permitted by law, the Holders of Additional Bonds, if any.
SECTION 7.02: SECURITY OF FUNDS. Any cash balance in any
fund shall, to the extent not insured by the Federal Deposit
Insurance Corporation or its successor, be continuously secured by
a valid pledge to the District of securities eligible under the
laws of Texas.to secure the funds of municipal utility districts,
having an aggregate market value, exclusive of accrued interest, at
all times equal to the uninsured cash balance in the fund to which
such securities are pledged.
SECTION 7.03: GENERAL OPERATING FUND. The establishment of
the General Operating Fund is hereby affirmed. The District shall
deposit, as collected, the Revenues (except earnings and profits
derived from the investment of the funds as provided in Section
7.09 hereof) from the operation of the System into the General
Operating Fund. Preferentially, all moneys deposited in the
General Operating Fund shall be used for the purpose of paying the
maintenance and operation expenses of the System. The District may
LLR\60S09.1\BONDRESOLUTION2021 2 5
accumulate and maintain an operating reserve in the General
Operating Fund (the "Operating Reserve").
SECTION 7.04: DEBT SERVICE FUND. The District shall deposit
or cause to be deposited into the Debt Service Fund the aggregate
of the following at the time specified:
(a)
as soon as practicable after the Bonds are sold, accrued
interest on the Bonds from the Initial Date to the date
of delivery of the Bonds to the Purchaser;
(b)
as soon as practicable after the Bonds are sold,
capitalized interest on the Bonds; and
(c)
taxes levied and collected pursuant to Section 6.02
hereof, less costs of collection, as collected.
Not later than five (5) days prior to any principal and/or interest
payment date on the Bonds, the Board of Directors shall cause the
transfer of moneys out of the Debt Service Fund to the Paying
Agent/Registrar in an amount not less than that which is sufficient
to paythe principal which matures on such date, the interest which
accrues on such date, and the Paying Agent/Registrar's fees for
handling such payments on that date.
SECTION 7.05: CONSTRUCTION FUND. The establishment of the
Construction Fund is hereby affirmed. The proceeds from the sale
of the Bonds, after making the deposits to the Debt Service Fund
from the proceeds of the Bonds as specified in Section 7.04 above,
shall be deposited into the Construction Fund and shall be used
solely for the expenses incident to the issuance of the Bonds and
the costs of acquiring, purchasing, and constructing the facilities
for which the Bonds were sold.
The District shall have the authority to retain the following
described monies in the Construction Fund and may expend such sums
for any item which may be properly paid by the District from its
Construction Fund upon the approval of the Texas Natural Resource
Conservation Commission.
(a)
The balance of the District's Construction Fund, if any,
remaining unexpended from the proceeds of the sale of the
Bonds after completion of the acquisition, purchase and
construction of the facilities for which the Bonds were
sold; and
(b)
All interest, income, and increment accruing to the
District as a result of the temporary investment of the
proceeds of the sale of the Bonds which are placed in the
District's Construction Fund.
Upon completion of the acquisition, purchase, and construction
of all facilities, any unspent monies remaining from the sale of
LLR\60809.1\BONDRESOLUTION2021 2 6
the Bonds, and the interest earned on such monies, shall he
deposited into the District's Debt Service Fund.
SECTION 7.06: BOND REDEMPTION FUND. The District reserves
the right to create one or more funds to be known as "Bond
Redemption FUnds" in connection with any issue or issues of
Additional Bonds or Revenue Bonds which are term bonds, and to
provide for the transfer of Net Revenues into a Bond Redemption
Fund for the purpose of redeeming all or a specified part of such
Additional Bonds or Revenue Bonds prior to maturity.
SECTION 7.07: INVESTMENTS, EARNINGS. Moneys deposited into
the Debt Service Fund, and any other fund or funds which the
District may lawfully create may be invested or reinvested in
Authorized Investments. All investments and any profits realized
from or interest accruing on such investments shall belong tothe
fund from which the moneys for such investments were taken;
provided, however, that at the discretion of the Board of Directors
the profits realized from and interest accruing on investments made
from any fund may be transferred to the Debt Service Fund. If any
moneys are so invested, the District shall have the right to have
sold in the open market a sufficient amount of such investments to
meet its obligations in the event any fund does not have sufficient
uninvested funds on hand to meet the obligations payable out of
such fund. Under such circumstances, the District shall give
notice to the Depository to sell such investments in the open
market. After such sale the moneys resulting therefrom shall
belong to the fund from which the moneys for such investments were
initially taken. The District shall not be responsible to the
Bondholders for any loss arising out of the sale of any
investments.
ARTICLE EIGHT
TAX EXEMPTION
SECTION 8.01 Definitions. When used in this Article, the
terms listed below shall have the meanings specified below, unless
it is otherwise expressly provided or unless the context otherwise
requires:
"Code" means the Internal Revenue Code of 1986, as amended by
any amendments thereto enacted prior to the Issue Date.
"Computation Date" has the meaning set forth in Section 1.148-
3(e) of the Regulations.
"Gross Proceeds" has the meaning set forth in Section 1.148-
l(b) of the Regulations.
"Investment" has the meaning stated in section 1.148-1(b) of
the Regulations and includes:
LLR\60809.1\BONDRESOLUTION2021 2 7
(1) Stock: a share of stock in a corporation or a
right to'subscribe for or to receive such a share,
(2) Debt: any indebtedness or evidence thereof,
including without limitation United States Treasury bonds,
notes, and bills (whether or not of the State and Local
Government Series) and bank deposits (whether or not
certificated or interest bearing or made pursuant to a
depository contract),
(3) Annuities and Deferred Payments: any annuity
contract, or any other deferred payment contract acquired to
fund an obligation of the District, or
(4) Other Property: any other investment-type property.
"Issue Date" means the date on which the Bonds are initially
authenticated and delivered to the Purchaser against payment
therefor.
"Issue Price" of the Bonds of any series and stated maturity
means the amounts set out in paragraph 4 of the Certificate of
Underwriters executed on the Closing Date.
"Net sale Proceeds" has the meaning set forth in section
1.148-1(b) of the Regulations.
"Proceeds" has the meaning set forth in section 1.148-1(b) of
the Regulations.
"Rebate Amount" has the meaning set forth in section 1.148-3
of the Regulations.
"Regulations" shall mean the temporary or final Income Tax
Regulations applicable to the Bonds issued pursuant to Sections 141
through 150 of the Code. Any reference to a section of the
Regulations shall also refer to any successor provision to such
section hereafter promulgated by the Internal Revenue Service
pursuant to Sections 141 through 150 of the Code and applicable to
the Bonds.
"Sale Proceeds" has the meaning set forth in section 1.148-
l(b) of the Regulations.
"Taxable Investment" means any Investment other than
(1)' Non-AMT Tax Exempt Obliaations: an obligation the
interest on which is excluded from the gross income, as
defined in section 61 of the Code, of the owners thereof for
federal income tax purposes (or, when such obligation was
issued, was purported by the evidence of such obligation to be
so excluded) and which is not a preference item, as defined in
section 57 of the Code,
B. No Private Use or Payments. At all times prior to the
last Maturity of Bonds, the District shall neither
(1). use nor permit the use of Gross Proceeds (or any
property acquired, constructed or improved with Gross Proceeds
or income from the investment thereof) in any trade or
business carried on by any Person (or in any activity of any
Person other than an individual) other than a state or local
government, nor
(2) directly or indirectly impose or accept any charge
or other payment for use of Gross Proceeds (or use of any
property acquired, constructed, or improved with Gross
Proceeds or income from the investment thereof) in any trade
or business carried on by any Person (or in any activity of
any Person other than an individual) other than a state or
local government,
unless either (i) such use is merely as a member (and, except
possibly for the amount of use and any corresponding rate
adjustment, is extended by the District on the same terms as to all
other members) of the general public or (ii) such charge or payment
consists of taxes of general application within the District or
interest earned on temporary Investments acquired with Gross
Proceeds pending application of such Gross Proceeds for their
intended purposes. For purposes of this Subsection B, property is
considered to be "used" by a Person if:
(a) Sale or Lease: it is sold or otherwise disposed of,
or leased, to such Person;
(b) Manaqement Contract: it is operated, managed, or
otherwise physically employed, utilized, or consumed by such
Person, excluding operation or management pursuant to an
agreement which meets the conditions described in I.R.S. Rev.
Proc. 97-13;
(c) Capacity, Output. or Service Commitment: capacity
in or output or service from such property is reserved or
committed to such Person under a take-or-pay, output,
incentive payment, or similar contract or arrangement;
(d) Preferential Service: such property is used to
provide service to (or such service is committed to or
reserved for) such Person on a basis or terms which (except
possibly for the amount of use and any corresponding rate
adjustment) are different from the basis or terms on which
such service is provided (or committed or reserved) to members
of the public generally;
(e) Developer: such Person is a developer and a
significant amount of property acquired, constructed, or
improved with proceeds from the sale of a series of bonds of
LLR\60809.1\BONDRESOLUTION2021 3 0
which the Bonds are a part serves only a limited area
substantially all of which is owned by such Person, or a
limited group of developers, unless such property carries out
an essential governmental function, use by such Person is
during an initial development period, and such property is
developed and sold to (and occupied by) members of the general
public in accordance with the Regulations; or
(f) Other Incidents of Ownership: substantial burdens
and benefits of ownership of such property are otherwise
effectively transferred to such Person,
but the temporary investment of Gross Proceeds pending application
for their intended purposes shall not constitute "use" of Gross
Proceeds.
C. No Private Loan. The District shall not use Gross
Proceeds to make or finance loans to any Person other than a state
or local government, excluding loans consisting of temporary
investments of Gross Proceeds pending application of such Gross
Proceeds for their intended purposes. For purposes of this
Subsection C, Gross Proceeds are considered to be "loaned" to a
Person if (1) property acquired, constructed, or improved with
Gross Proceeds is sold or leased to such Person 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 under
a take-or-pay, output, or similar contract or arrangement, or (3)
indirect benefits, or burdens and benefits of ownership, of Gross
Proceeds or such property are otherwise transferred to such Person
in a transaction which is the economic equivalent of a loan.
D. Not to Invest at Higher Yield. The District shall not, at
any time prior to the final Maturity of the Bonds, directly or
indirectly invest Gross Proceeds in any Taxable Investment (or use
Gross Proceeds to replace money so invested), if, as a result of
such investment, the Yield of all Taxable Investments acquired with
(or representing an investment of) Gross Proceeds (or money
replaced thereby), whether then held or previously disposed of, to
the date of such investment exceeds the Yield of the Bonds.
Notwithstanding the foregoing, however, the following Investments
shall' be excluded from the limitation described in this
Subsection D:
(1) Three-Year Period for Sale Proceeds: Taxable
Investments acquired with (or representing an investment of)
proceeds from the sale of the Bonds or earnings from the
investment thereof, to the extent such Taxable Investments are
held during the three-year period beginning on the Issue Date;
(2) One-Year Period for Earnings on Sale Proceeds:
Taxable Investments acquired with (or representing an
investment of) income from investment of proceeds from the
I.,I..R\6080S. I\BONDRI~SO'LUTION2021 3 1
sale of the Bonds, to the extent such Taxable Investments are
held durin9 the first year after receipt of such income;
(3) 1998 Debt Service Fund Deposits: Taxable
Investments acquired with (or representing an investment of)
amounts held for the credit of the Debt Service Fund for the
payment of the debt service on the Bonds during the then
current bond year (the "1999 Debt Service Fund"), but only
during the first 13 months after the date of deposit of such
amounts to the Debt Service Fund;
(4) Debt Service Fund Deposits: Taxable Investments
acquired with (or representing an investment of) amounts held
for the credit of the Debt Service Fund in excess of the
amounts held for the credit of the 1999 Debt Service Fund to
the extent such Taxable Investments are held during the first
30 days after the date of deposit of such amounts to the Debt
Service Fund or, if held more than 30 days after deposit, do
not exceed 10% of the stated principal amount of the Bonds;
and
(5) Other Investments: any other Taxable Investments
acquired with (or representing an investment of) Gross
Proceeds described in Clause (3) of the definition thereof, to
the extent the aggregate amount of Gross Proceeds invested in
such Taxable Investments does not exceed the lesser of
$100,000 or 5% of the proceeds from sale of the Bonds.
The District shall not use any money to pay principal of or
interest on the Bonds, or pledge (or permit to be pledged) or
otherwise restrict any money, funds, or Taxable Investments so as
to give reasonable assurance of their availability for such
purpose, except in each case amounts deposited to the Debt Service
Fund.
E. No Federal Guarantees, Etc. The District shall not
either (a) use Gross Proceeds in an amount which exceeds 5% of the
proceeds from the sale of the Bonds (i) to make loans which are
guaranteed in whole or in part by the United States or any.agency
or instrumentality thereof, including any entity with statutory
authority to borrow from the United States, or (ii) to invest in
any deposit or account in a financial institution to the extent
such deposit or account is insured under federal law by the Federal
Deposit Insurance Corporation, the National Credit Union Admin-
istration, or any similar federally-Ohartered corporation, or (b)
otherwise permit payment of principal of or interest on the Bonds
to be directly or indirectly guaranteed in whole or in part by the
United States or any agency or instrumentality thereof, including
any entity with statutory authority to borrow from the United
States (e.g., by the investment of amounts held for the credit of
the Debt Service Fund in federally-guaranteed or federally-insured
obligations). Notwithstanding the foregoing, however, the District
may acquire:
x.xa\eosos. ~\BommEsox,u'no~2o2~ 3 2
(1) Certain Temporary Investments: Investments
described in Subsections D(1), D(3), or D(4) of this Section,
whether or not federally-guaranteed or federally-insured, to
the extent such Investments are held during the period
described in such Subsection;
(2) Treasury Investments:
United States Treasury; and
Investments issued by the
(3) Investments Permitted by Regulations: Any other
Investments permitted by regulations of the United States
Department of Treasury issued under section 149(b)(3)(B)(v) of
the Code.
F. Not to Divert Arbitraqe Profits. Prior to the final
Maturity of the Bonds, the District shall not at any time invest
amounts held for the credit of the Construction Fund or the Debt
Service Fund in any Investment purchased at other than an arm's
length price or for which there is not an established market at the
time of investment, except possibly for Investments described in
Subsection D(2) of this Section to the extent such Investments are
acquired and mature or are disposed of during the period described
in such Subsection.
G. To File Informational Report. The District shall execute
and file with the Secretary of the Treasury, not later than the
15th day of the second calendar month after the close of the
calendar quarter in which the Issue Date occurs (or by such later
date as such Secretary may permit for reasonable cause or may
prescribe with respect to any portion of such statement), a
statement containing the information and in the form required by
section 149(e) of the Code or the Regulations promulgated
thereunder.
H. Not to Cause Bonds to Become Hedge Bonds.
warrants and represents that:
The District
(1) the District reasonably expects that at least 85% of
the Net Sale Proceeds of the Bonds will be used to carry
out the governmental purposes of the Bonds within three
years from the Issue Date, and
(2) not more than 50% of the Proceeds of the Bonds will
be invested in nonpurpose investments (as defined in
section 148(f)(6)(A) of the Code) having a substantially
guaranteed Yield for four years or more.
I. Payment of Rebatable Arbitrage.
otherwise provided in section 148(f) of
regulations and rulings thereunder,
Except to the extent
the Code and the
(1) The District shall account for all Gross Proceeds
(including all receipts and expenditures thereof) on its books of
I'.I.,R\60S09. I\BONDRESOT.UTION2021 3 3
account separately and apart from all other funds (and receipts,
expenditures, and investments thereof) and shall maintain all
records of such accounting with the transcript of proceedings
relating to the issuance of the Bonds until six years after the
final Computation Date. The District may, however, to the extent
permitted by law, commingle Gross Proceeds of the Bonds with other
money of the District, provided that the District separately
accounts for each receipt and expenditure of such Gross Proceeds
and the obligations acquired therewith.
(2) Not less frequently than each Computation Date, the
District shall either (i) cause to be calculated by a nationally
recognized accounting or financial advisory firm or (ii) calculate
and cause its calculations to be verified by a nationally
recognized accounting or financial advisory firm, in either case in
accordance with rules set forth in section 148(f) of the Code and
section 1.148-3 of the Regulations and rulings thereunder, the
Rebate Amount with respect to the Bonds. The District shall
maintain such calculations with the official transcript of the
proceedings relating to the issuance of the Bonds until six years
after the final Computation Date.
(3) As additional consideration for the purchase of the
Bonds by the Purchasers and the loan of money represented thereby,
and in order to induce such purchase by measures designed to
preserve the excludability of the interest thereon from the gross
income of the owners thereof for federal income tax purposes, the
District shall remit to the United States the amount described in
paragraph (2) above and the amount described in paragraph (4)
below, at the times, in the installments, to the place, in the
manner, and accompanied by such forms or other information as is or
may be required by section 148(f) of the Code and the Regulations
and rulings thereunder.
(4) The District shall exercise reasonable diligence to
assure that no errors are made in the calculations required by
paragraph (2) and, if such error is made, to discover and promptly
to correct such error within a reasonable amount of time
thereafter, including payment to the United States of any interest
and any penalty required by section 1.148-3(h) of the Regulations.
SECTION 8.03. Oualified Tax-Exempt Obligations. The District
hereby designates the Bonds as "qualified tax-exempt obligations"
pursuant to Section 265(b)(3) of the Code.
The District hereby warrants and represents that
(a) the aggregate face amount (or, in the case of
obligations on which interest is paid less frequently than
semiannually, the aggregate amount of principal and interest
due at maturity) of all debt obligations issued or expected to
be issued by the District in the calendar year of the Issue
Date (including the Bonds) is not reasonably expected to
exceed $10,000,000;
(b) there are no other Persons which derive their authority
from or are subject to the control of the District and which
have authority to issue obligations described in section 103
of the Code; and
(c) consequently, the Bonds are eligible to be "qualified
tax-exempt obligations" pursuant to section 265(b)(3) of the.
Code.
The President of the Board is hereby authorized to take such
other action as may be necessary to make effective the designation
herein.
ARTICLE NINE
ADDITIONAL BONDS AND REFUNDING BONDS
SECTION 9.01: ADDITIONAL BONDS. The District expressly
reserves the right to issue, in one or more installments, for the
purpose of completing, repairing, improving, extending, enlarging,
or replacing the System or any other lawful purpose:
(a)
the unissued unlimited tax bonds which were authorized at
the bond elections described in Section 1.05 of this
Resolution; and
(b) such other unlimited tax bonds as may hereafter be
authorized at subsequent elections.
SECTION 9.02: REVENUE BONDS. The District expressly reserves
the right to issue revenue bonds in one or more installments for
the purpose of completing, repairing, improving, extending,
enlarging, or replacing the System, which will be payable solely
from the Net Revenues and such bonds may be payable from and
equally secured by a lien on and pledge of the Net Revenues, if
such revenue bonds are approved by the voters of the District.
SECTION 9.03: INFERIOR LIEN BONDS. The District also
reserves the right to issue inferior lien bonds and pledge the Net
Revenues to the payment thereof, such pledge to be subordinate in
all respects to the lien of previously issued Additional Bonds and
Revenue Bonds.
SECTION 9.04: SPECIAL PROJECT BONDS. The District further
reserves the right to issue bonds in one or more installments for
the purchase, construction, improvement, extension, replacement,
enlargement, or repair of water, sewer, and/or drainage facilities
necessary under a contract or contracts with persons, corporations,
municipal corporations, political subdivisions, or other entities,
such bonds to be payable from and secured by the proceeds of such
m.a\eosog. ~\~OX~ORSSOLFnON20~ 3 5
contract or contracts. The District further reserves the right to
refund such bonds.
SECTION 9.05: REFUNDING BONDS. The District further reserves
the right to issue Refunding Bonds in any manner permitted by law
to refund any Bonds and Additional Bonds at or prior to their
respective dates of maturity or redemption.
ARTICLE TEN
SECTION 10.01: PERSONS DEEMED OWNERS. The District, the
PayingAgent/Registrar, and any agent of either of them may treat
the Person in whose name any Bond is registered as the owner of
such Bond for the purpose of receiving payment of the principal
(and Redemption Price) of and interest on such Bond and for all
other purposes whatsoever, and to the extent permitted by law,
neither the District, the PayingAgent/Registrar, nor any agent of
either of them shall be affected by notice to the contrary.
SECTION 10.02: NOTICES TO HOLDERS; WAIVER. Wherever this
Resolution provides for notice to Bondholders of any event, such
notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to each Holder of such Bonds, at the address of such
Holder as it appears in the Bond Register. In any case where
notice to Holders of Bonds is given by mail, neither the failure to
mail such notice to any particular Holder of Bonds, nor any defect
in any notice so mailed, shall affect the sufficiency of such
notice with respect to all other Bonds. Where this Resolution
provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent
of such notice. Waivers of notice by Holders shall be filed with
the Paying Agent/Registrar, but such filing shall not be a
condition precedent to the validity of any action taken in reliance
upon such waiver.
SECTION 10.03: DUTIES OF DISTRICT OFFICIALS. The President
or any Vice President and the Secretary or any Assistant Secretary
of the Board of Directors and other appropriate officers and agents
of the District are hereby authorized and directed to do any and
all things necessary and/or convenient to carry out the provisions
of this Resolution.
ARTICLE ELEVEN
SALE AND DELIVERY OF BONDS
SECTION 11.01: SALE OF BONDS: BOND PURCHASE AGREEMENT. The
Bonds are hereby sold and shall be delivered to
(the
"Purchaser") pursuant to the taking of public bids therefor on
September 28,1999, for a price of $ plus accrued
LLR\60809.1\BONDRESOLUTION2021 3 6
interest from the Initial Date to the date of delivery. Delivery
of the Bonds to the Purchaser shall be made as soon as practicable
after the adoption of this Resolution, upon payment therefor, in
accordance with the terms of the sale. Purchaser's obligation to
accept delivery of the Bonds is subject to it being furnished an
approving legal opinion of Coats, Rose, Yale, Ryman & Lee, P.C.,
bond counsel to the District, approving the Bonds as to their
validity and that the interest thereon is exempt from Federal
taxation, said opinion to be dated and delivered as of the date of
delivery and payment for the Bonds. The Board hereby finds and
determines that the net effective interest rate of the issue or
series of bonds authorized by this Resolution is %, which
is the lowest net effective interest rate bid to the District, as
required by law.
SECTION 11.02: APPROVAL, REGISTRATION AND DELIVERY. The
President of the Board of Directors of the District and
representatives of Coats, Rose, Yale, Ryman & Lee, P.C. are hereby
authorized and directed to submit the Bonds, and a transcript of
the proceedings relating to the issuance of the Bonds, to the
Attorney General of the State of Texas for approval and, following
said approval~ to submit the Initial Bond to the Comptroller of
Public Accounts of the State of Texas for registration. Upon
registration of the Initial Bond, the Comptroller of Public
Accounts (or a deputy designated in writing to act for the
Comptroller) shall manually sign the Comptroller's registration
certificate prescribed herein to be printed and endorsed on the
Initial Bond. After the Initial Bond has been registered and
signed by the Comptroller, it shall be delivered to the
Underwriter, but only upon receipt of the full purchase price.
ARTICLE TWELVE
SPECIFIC OBLIGATIONS OF BOARD
The Board on behalf of the District expressly stipulates and
covenants that, for the benefit of the Purchaser and any and all
subsequent Holders of the Bonds (and enforceable by any one or all
of said Holders), in addition to all other provisions hereof, it
will:
(a)
Fix and maintain rates and collect charges for the
facilities and services rendered by the District which,
together with any taxes levied for maintenance purposes,
will provide revenues sufficient at all times to pay all
reasonable administration expenses of the District and
all efficient operation and adequate maintenance expenses
of the System. The Board has enacted and will maintain
in effect an order fixing rates and charges for services
which contains, among other provisions, a requirement for
periodic billing of all customers of the District and a
prohibition against the furnishing of water or sewer
LLR\60S09.1\BONDRESOLUTION2021 3 7
(b)
(c)
(d)
(e)
(f)
service without charge to any person, firm, organization,
or corporation.
Subject to the provisions of Article Six of this
Resolution, levyan ad valorem tax that will be ample and
sufficient to provide funds to pay the interest on the
Bonds and to provide the necessary sinking fund.
Not mortgage or otherwise encumber the physical
properties of the System, nor sell, lease, or otherwise
dispose of any substantial portion of such physical
properties, unless said properties of the System are
deemed by the Board of Directors of the District to be
unnecessary to the operation of the System.
Maintain the System in good condition and operate it in
an efficient manner and at a reasonable cost.
Maintain insurance on the System of a kind and in an
amount which usually would be carried by municipal
corporations and political subdivisions in Texas
operating similar facilities.
Keep records and accounts and employ an independent
certified public accountant of recognized integrity and
ability to direct the installation of the required
accounting procedures and to audit its affairs at the
close of each fiscal year. The fiscal year of the
District is from October I to September 31 of the
following year, or such other fiscal year as the Board of
Directors may hereafter designate. Said audits shall
include a statement in detail of the income and
expenditures of the System for each year; a balance sheet
as of the end of the year; the auditor's comments
regarding the manner in which the District has carried
out the requirements of all Bond Resolutions; his recom-
mendations, if any, for changes or improvements in the
operation of the District's plants, facilities, and
improvements; a list of insurance policies in force as of
the date of the audit including the amount, expiration
date, risk covered, and name of the insurer for each such
policy; and the number of properties connected to the
System as of the end of the fiscal year. The audit
report shall be delivered to each member of the Board not
later than 120 days after the close of each fiscal year
and shall be retained and filed in the office of the
auditor. Copies of said audit shall be filed as required
by law and maintained in the office of the District,
available for inspection by any interested person or
persons during normal office hours.
LLR\60809.1\BONDRESOLUTION2021 3 8
ARTICLE THIRTEEN
DEFEASANCE OF OBLIGATIONS OF DISTRICT
SECTION 13.01: DEFEASANCE. If the District shall pay or
cause to be paid, or there shall otherwise be paid to the Holders,
the principal of and interest on the Bonds, at the times and in the
manner stipulated in this Resolution, then the pledge of any taxes
or other money, securities, and funds pledged under this Resolution
and all covenants, agreements, and other obligations of the
District to the Holders of Bonds shall thereupon cease, terminate,
and become void and be discharged and satisfied, and the Paying
Agent/Registrar shall pay over or deliver all money held by it
under this Resolution to the District.
Bonds or interest installments for the payment of which money
shall have been set aside and shall be held in trust by the Paying
Agent/Registrar or with any other bank or trust company which has
agreed to hold the same for such purpose (through deposit by the
District of funds for such payment or otherwise) at the Stated
Maturity thereof shall be deemed to have been paid within the
meaning and with the effect expressed above in this Section. All
Bonds shall be deemed to have been paid, prior to their Stated
Maturity, within the meaning and with the effect expressed above in
this Section, if there shall have been deposited with the Registrar
either (a) money in an amount which shall be sufficient to make
such payment, (b) Governmental Securities certified by an
independent public accounting firm of national reputation to be of
such maturities and interest payment dates and to bear such
interest as will, without further investment or reinvestment of
either the principal amount thereof or the interest earnings
therefrom, be sufficient to make such payment, or (c) a combination
of money and Governmental Securities together so certified to be
sufficient to make such payment, provided that all the expenses
pertaining to the Bonds with respect to which such deposit is made
shall have been paid or the payment thereof provided for to the
satisfaction of the PayingAgent/Registrar (and to such other bank
or trust company).
SECTION 13.02: PARTIAL DEFEASANCE. In the event such deposit
is made with respect to some but not all of the Bonds then
outstanding, the District shall designate the Stated Maturities of
Bonds with respect to which such deposit is made. If such deposit
shall be sufficient to provide for the payment of the principal of
and interest on some but not all Outstanding Bonds of a particular
Stated Maturity so designated, the Paying Agent/Registrar shall
select the Outstanding Bonds of such Stated Maturity with respect
to which such deposit is made by such random method as the Paying
Agent/Registrar shall deem fair and appropriate and which may
provide for the selection of portions (equal to and leaving
unredeemed an authorized denomination) of Bonds a denomination
larger than $5,000. Notwithstanding anything herein to the
contrary, no such deposit shall have the effect described in this
LLR\60809.1\BONDRESOLUTION2021 3 9
Article if made during the subsistence of a default in the payment
of any Bond (a) unless made with respect to all of the Bonds then
outstanding, or (b) unless accompanied by an opinion of counsel of
recognized standing in the field of federal income taxation to the
effect that neither such deposit nor the investment thereof shall
adversely affect the excludability of interest on any Bond from the
gross income of any owner thereof for federal income tax purposes.
SECTION 13.03: INVESTMENTS. No money or Governmental
Securities so deposited shall be invested or reinvested unless in
Governmental Securities and unless such money and Governmental
Securities not invested and such new investments are together
certified by an independent public accounting firm of national
reputation to be of such amounts, maturities, and interest payment
dates and to bear such interest as will, without further investment
or reinvestment of either the principal amount thereof or the
interest earnings therefrom, be sufficient to make such payment.
Neither Governmental Securities nor money deposited with the Paying
Agent/Registrar or other bank or trust company pursuant to this
Section, nor principal or interest payments on any such
Governmental Securities, shall be withdrawn or used for any purpose
other than, and shall be held in trust for, the payment of the
principal of, and interest on such Bonds. Any cash received from
such principal of and interest on such investment securities
deposited with the Paying Agent/Registrar, if not needed for such
purpose, shall, to the extent practicable, be reinvested in
Governmental Securities (which may be non-interest bearing)
maturing at times and in amounts sufficient to pay when due the
principal of and interest on such Bonds on and prior to the
maturity thereof, and interest earned from such reinvestments shall
be paid over to the District as received by the Paying
Agent/Registrar, free and clear of any trust, lien, or pledge and
used in accordance with applicable law. Any payment for
Governmental Securities purchased for the purpose of reinvesting
cash as aforesaid shall be made only against delivery of such
Governmental Securities.
SECTION 13.04: RETIREMENT OF BONDS. At such times as a Bond
shall be deemed to be paid hereunder, as aforesaid, it shall no
longer be entitled to the benefits of this Resolution, except for
the purposes of any such payment from such money or Governmental
Securities, and for the provisions of Section 3.07 and 3.08
relating to transfer, exchange, and replacement of Bonds and the
covenants of the District contained in Article Eight. At such
times as all of the Bonds are retired, or provision is made for
their payment, money in the Debt Service Fund, if any, may be
transferred to the General Operating Fund of the District, provided
that any money held by the Paying Agent/Registrar which has been
provided for 'the payment of interest or principal and not so
utilized for any reason shall continue to be held for a period of
four calendar years, and if not claimed, the same may be returned
to the General Operating Fund of the District, subject, however, to
applicable unclaimed property laws of the State of Texas.
LLR\60809.1\BONDRESOLUTION2021 4 0
ARTICLE FOURTEEN
CONTINUING DISCLOSURE
SECTION 14.01: ANNUAL REPORTS. The District shall provide
annually to each nationally recognized municipal securities
information repository ("NRMSIR") and the state information
depository ("SID"), within six (6) months after the end of each
fiscal year ending in or after 1999, financial information and
operating data with respect to the District of the general type
included in the Official Statement authorized by Section 16.05 of
this Bond Resolution, being the information described in Section
14.04 hereof. Any financial statements so to be provided shall be
(1) in accordance with generally accepted accounting principles and
(2) audited, if the District commissions an audit of such
statements and the audit is complete within the period during which
they must be provided. If audited financial statements are not so
provided, then the District shall provide unaudited financial
statements as part of the annual report and shall provide audited
financial statements for the applicable fiscal year to each NRMSIR
and the SID, when and if audited financial statements become
available.
If the District changes its fiscal year, it will notify each
NRMSIR and the SID of the change (and of the date of the new fiscal
year) prior to the next day by which the District would otherwise
be required to provide financial information and operating data
pursuant to this Article.
The financial information and operating data to be provided
pursuant to this Article may be set forth in full in one or more
documents or may be included by specific reference to any document
including an official statement or other offering document, if it
is available from the Municipal Securities Rulemaking Board
("MSRB") that heretofore has been provided to each NRMSIR and the
SID or filed with the United States Securities and Exchange
Commission ("SEC").
SECTION 14.02: MATERIAL EVENTS NOTICES. The District shall
notify any SID and either each NRMSIR or the MSRB, in a timely
manner, of any of the following events with respect to the Bonds,
if such event is material within the meaning of the federal
securities laws:
1. Principal and interest payment delinquencies;
2. Non-payment related defaults;
Unscheduled draws on debt service reserves reflecting
financial difficulties;
LLR\60a09.1\BONDRESOLUTION2021 4 1
4. Unscheduled draws on credit enhancements, if any,
reflecting financial difficulties;
Substitution of credit or liquidity providers, if any, or
their failure to perform;
Adverse tax opinions or events affecting the tax-exempt
status of the Bonds;
7. Modifications of the rights of the Owners of the Bonds;
8. Bond calls;
9. Defeasance;
10.
Release, substitution, or sale of property securing
payment of the Bonds; and
11. Rating changes.
SECTION 14.03: LIMITATION, DISCLAIMERS, AND AMENDMENTS.
The District shall be obligated to observe and perform the
covenants specified in this Article for so long as, but only for so
long as, the District remains an "obligated person" with respect to
the Bonds within the meaning of the Rule, except that the District,
in any event, will give the notice required by Section 14.02 of any
Bond calls and defeasance that cause the District to no longer be
an "obligated person."
The provisions of this Article are for the sole benefit of the
Holders of the Bonds and nothing in this Article express or implied
shall give any benefit or any legal or equitable right, remedy, or
claim hereunder to any other person. The District undertakes to
provide only the financial information, operating data, financial
statements, and notices which it has expressly agreed to provide
pursuant to this Article and does not undertake to provide any
other information that may be relevant or material to a complete
presentation of the District's financial results, conditions,
prospects or hereby undertakes to update any information provided
in accordance.with this Article or otherwise, except as expressly
provided herein. The District does not make any representation or
warranty concerning such information or concerning its usefulness
to a decision to invest in or sell Bonds at any future date.
UNDER NO CIRCUMSTANCE SHALL THE DISTRICT BE LIABLE TO THE
OWNER OF ANY BOND OR AMY OTHER PERSON, IN CONTRACT OR TORT, FOR
DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE
DISTRICT, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY
COVENANT SPECIFIED IN THIS ARTICLE, BUT EVERY RIGHT AND REMEDY OF
ANY EUC~ PEREON, IN CONTRACT OR IN TORT, FOR OR ON ACCOUNT OF ANY
SUCH BREACH SHALL BE LIMITED TO ANACTION FOR M/~qDAMUS OR SPECIFIC
PERFORMANCE.
LLR\60809.1\BONDRESOLUTION2021 4 2
No default by the District in observing or performing its
obligations under this Article shall comprise a breach of or a
default underthe Resolution for purposes of any other provision of
this Resolution.
Nothing in this Article is intended or shall act to disclaim,
waive or otherwise limit the duties of the District under federal
and state securities laws.
The District may amend its continuing disclosure agreement
from timeto time to adapt to changed circumstances that arise from
a change in legal requirements, a change in law, or a change in the
identity, nature, status, or type of operations of the District, if
but only if (1) the agreement, as amended, would have permitted an
underwriter to purchase or sell Bonds in the 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 principal amount of the outstanding bonds
consent to such amendment or (b) any person unaffiliated with the
District (such as nationally recognized bond counsel) determines
that such amendment will not materially impair the interests of the
Holders of the Bonds. The District may amend or repeal this Article
if the SEC amends or repeals the applicable provisions of the Rule
or a court of final jurisdiction determines that such provisions
are invalid or unenforceable, but only to the extent that its right
to do so would not prevent the Underwriter from lawfully purchasing
the Bonds in the initial offering. If the District amends the
agreement, it will include with any financial information or
operating data 'next provided in accordance with its agreement
described above under "Annual Reports" an explanation, in narrative
form, of the reasons for the amendment and of the impact of any
change in the type of financial information and operating data so
provided.
The District has not previously made a continuing disclosure
agreement in accordance with SEC Rule 15c2-12.12.
SECTION 14.04: DESCRIPTION OF ANNUAL FINANCIAL INFORMATION.
The following information is referred in Section 14.01 of this
Article:
a. Annual Financial Statements and Operating Data. The
financial information and operating data with respect to the
District to be provided annually are as specified below:
(i) Appendix B to the Official Statement: Financial
Statements and Auditor's Report; and
(ii) Quantitative financial information and operating
data of the general type included in the Official
Statement under the headings "DISTRICT DEBT" and
"TAX DATA."
LLR\60809. I\BONDRESOLUTION2021 4 3
b. Accounting Principles. The accounting principles
referred to in Section 14.01 are generally accepted accounting
principles for governmental units as prescribed by the Governmental
Accounting Standards Board from time to time, as such principles
may be changed from time to time to comply with state law or
regulation, or as otherwise stated in the financial statements.
ARTICLE FIFTEEN
MUNICIPAL BOND INSURANCE POLICY
PAYMENTS UNDER THE POLICY
A. In the event that, on the second Business Day, and again
on the Business Day, prior to the payment date on the Bonds, the
Registrar has not received sufficient moneys to pay all principal
of and interest on the Bonds due on the second following or
following, as the case may be, Business Day, the Registrar shall
immediately notify the Insurer or its designee on the same Business
Day by telephone or telegraph, confirmed in writing by registered
or certified mail, of the amount of the deficiency.
B. If the deficiency is made up in whole or in part prior to
or on the payment date, the Registrar shall so notify the Insurer
or its designee.
C. In addition, if the Registrar has notice that any Owner
of the Bonds has been required to disburse payments of principal or
interest on the Bonds to a trustee in Bankruptcy or creditors or
others pursuant to a final judgment by a court of competent
jurisdiction that such payment constitutes an avoidable preference
to such Owner within the meaning of any applicable bankruptcy laws,
then the Registrar shall notify the Insurer or its designee of such
fact by telephone or telegraphic notice, confirmed in writing by
registered or certified mail.
D. The Registrar is hereby irrevocably designated,
appointed, directed and authorized to act as attorney-in-fact for
the Owners of the Bonds as follows:
(i)
If and to the extent there is a deficiency in amounts
required to pay interest on the Bonds, the Registrar
shall (a) execute and deliver to State Street Bank and
Trust Company, N.A., or its successors under the Policy
(the "Insurance Paying Agent"), in form satisfactory to
the Insurance Paying Agent, an instrument appointing the
Insurer as agent for the Owners of the Bonds in any legal
proceeding related to the payment of such interest and an
assignment to the Insurer of the claims for interest to
which such deficiency relates and which are paid by the
Insurer, (b) receive as designee of the respective Owners
(and not as Registrar) in accordance with the tenor of
the Policy payment from the Insurance Paying Agent with
LLR\60809.1\BONDRESOLUTION2021 4 4
respect to the claims for interest so assigned, and (c)
disburse the same to such respective Owners; and
(2)
If and to the extent of a deficiency in amounts required
to pay principal of the Bonds, the Registrar shall (a)
execute and deliver to the Insurance PayingAgent in form
satisfactory to the Insurance Paying Agent an instrument
appointing the Insurer as agent for such Owner in any
legal proceeding relating to the payment of such
principal and an assignment to the Insurer of any of the
Bonds surrendered to the Insurance Paying Agent of so
much of the principal amount thereof as has not
previously been paid or for which moneys are not held by
the Registrar and available for such payment (but such
assignment shall be delivered only if payment from the
Insurance Paying Agent is received), (b) receive as
designee of the respective Owners (and not as Registrar)
in accordance with the tenor of the Policy payment
therefor from the Insurance Paying Agent, and (c)
disburse the same to such Owners.
E. Payments with respect to claims for interest on and
principal of Bonds disbursed by the Registrar from proceeds of the
Policy shall not be considered to discharge the obligation of the
Issuer with respect to such Bonds, and the Insurer shall become the
owner of such unpaid Bonds and claims for the interest in
accordance with the tenor of the assignment made to it under the
provisions of this subsection or otherwise.
F. Irrespective of whether any such assignment is executed
and delivered, the Issuer and the Registrar hereby agree for the
benefit of the Insurer that:
They recognize that to the extent the Insurer makes
payments, directly or indirectly (as by paying through
the Registrar), on account of principal of or interest on
the Bonds, the Insurer will be subrogated to the rights
of such Owners to receive the amount of such principal
and interest from the Issuer, with interest thereon as
provided and solely from the sources stated in this Bond
Resolution and the Bonds; and
(2)
They will accordingly pay to the Insurer the amount of
such principal and interest (including principal and
interest recovered under subparagraph (ii) of the first
paragraph of the Policy, which principal and interest
shall be deemed past due and not to have been paid), with
interest thereon as provided in this Bond Resolution and
the Bonds, but only from the sources and in the manner
provided herein for the payment of principal of and
interest on the Bonds to Owners, and will otherwise treat
the Insurer as the owner of such rights to the amount of
such principal and interest.
LLR\60809.1\BONDRESOLUTION2021 4 5
G. In connection with the issuance of additional Bonds, the
Issuer shall deliver to the Insurer a copy of the disclosure
document, if any, circulated with respect to such additional Bonds.
H. Copies of any amendments made to the documents executed
in connection with the issuance of the Bonds which are consented to
by the Insurer shall be sent to Standard & Poor's Corporation.
removal
thereto.
The Insurer shall receive notice of the resignation or
of the Registrar and the appointment of a successor
J. The Insurer shall receive copies of all notices required
to be delivered to Owners of the Bonds and, on an annual basis,
copies of the Issuer's audited financial statements and Annual
Budget.
Notices: Any notice that is required to be given to an Owner
of the Bonds or to the Registrar pursuant to this Bond Resolution
shall also be provided to the Insurer. All notices required to be
given to the Insurer under this Bond Resolution shall be in writing
and shall be sent by registered or certified mail addressed to MBIA
Insurance Corporation, 113 King Street, Armonk, New York 10504,
Attention: Surveillance.
ARTICLE SIXTEEN
MISCELLANEOUS PROVISIONS
SECTION 16.01: OPEN MEETING. The Board of Directors
officially finds, determines, and declares that this Resolution was
reviewed, carefully considered, and adopted at a regular meeting of
the Board beginning at 6:30 p.m., Central Daylight Time, on
September 27, 1999, and that a sufficient written notice of the
date, hour, place, and subject of this meeting was posted at a
place readily accessible and convenient to the public within the
District and on bulletin boards located at a place convenient to
the public in the Brazoria County Courthouse for the time required
by law preceding this meeting, as required by the Texas Government
Code, Section 551.043, as amended, and that this meeting has been
open to the public as required by law at all times during which
this Resolution and the subject matter hereof has been discussed,
considered, and acted upon. The Board of Directors further
ratifies, approves, and confirms such written notice and the
contents and posting thereof.
SECTION 16.02: UNCLAIMED MONIES. Notwithstanding any other
provision of this Resolution to the contrary, the Texas Property
Code requires that all monies (including principal and interest
payments on the Bonds) which are unclaimed after three years be
turned over to the Texa~ State Treasurer if (a) the owner'~ last
known address as shown in the records of the PayingAgent/Registrar
is in Texas, or (b) if the holder of such unclaimed monies is a
LLR\60S09.1\BONDRESOLUTION2021 4 6
Texas governmental entity or a Texas corporation and (i) the
owner's identity is unknown or there is no known address for the
owner or (ii) the last known address of the owner is in a state
whose escheat or unclaimed property law is inapplicable to such
monies. Bondholders are advised to be cognizant of the provisions
of the Texas Property Code, particularly Chapters 71, 72, and 74
thereof as such provisions relate to the escheatment of unclaimed
monies to the Texas State Treasurer.
SECTION 16.03: RELATED MATTERS. To satisfy in a timely
manner all of the District's obligations under this Resolution, the
President and Secretary of the Board of Directors of the District
and all other appropriate officers and agents of the District are
hereby authorized and directed to take all other actions that are
reasonably necessary to provide for the issuance, sale, and
delivery of the Bonds including, without limitation, executing and
delivering on behalf of the District all certificates, consents,
receipts, requests, and other documents as may be reasonably
necessary to satisfy the District's obligations under this
Resolution and to direct the transfer and application of funds of
the District consistent with the provisions of this Resolution.
SECTION 16.04: PAYING AGENT/REGISTRAR. The form of agreement
setting forth the duties of the Paying Agent/Registrar is hereby
approved, and the appropriate officials of the District are hereby
authorized to execute such agreement for and on behalf of the
District.
SECTION 16.05: OFFICIAL STATEMENT. The Board of Directors of
the District hereby ratifies, authorizes, and approves, in
connection with the sale of the Bonds, the preparation and
distribution of the Preliminary Official Statement, dated
August 30, 1999,'and a final Official Statement substantially in
the same form containing such additional information and amendments
as may be necessary to conform to the terms of the Bonds and this
Resolution. The appropriate officials of the District are hereby
authorized to sign such Official Statement and/or to deliver
certificates pertaining to such Official Statement as prescribed
therein, dated as of the date of payment for and delivery of the
Bonds.
SECTION 16.06: REMEDIES IN EVENT OF DEFAULT. In addition to
any other rights and remedies provided by the laws of the State of
Texas, the District covenants and agrees that in the event of
default in payment of principal of or interest on any of the Bonds
when due, or, in the event it fails to make the payments required
to be made into the Debt Service Fund, as defined in Section 7.01,
or defaults in the observance or performance of any other of the
covenants, conditions, or obligations set forth in this Resolution,
the Holders shall be entitled to a writ of mandamus issued by a
court of competent jurisdiction compelling and requiring the
District and the officials thereof to observe and perform the
covenants, obligations, or conditions prescribed in this
LLR\60809.1\BONDRESOLUTION2021 4 7
Resolution. Any delay or omission to exercise any right or power
accruing upon any default shall not impair any such right or power
or be construed to be a waiver of any such default or acquiescence
therein, and every such right and power may be exercised from time
to time and as often as may be deemed expedient.
In consideration of the purchase and acceptance of the Bonds
authorized to be issued hereunder by the Holders, the provisions of
this Resolution shall constitute a contract between the District
and the Holders; and the covenants and agreements herein set forth
to be performed on behalf of the District shall be for the equal
benefit, protection, and security of each of the Holders. The
Bonds, regardless of the time or times of their issue or maturity,
shall be of equal rank without preference, priority, or distinction
of any Bond over any other, except as expressly provided herein.
SECTION 16.07: AMENDMENTS TO BOND RESOLUTION. The District
may, without the consent of or notice to any Holders of the Bonds,
amend, change, or modify this Resolution as may be required (a) by
the provisions hereof, (b) for the purpose of curing any ambiguity,
inconsistency, or formal defect or omission herein, or (c) in
connection with any other change which is not to the prejudice of
the Holders of the Bonds. Except for such amendments, changes, or
modifications, the District shall not amend, change, or modify this
Resolution in any manner without the consent of the Holders of the
Bonds.
SECTION 16.08: 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 in this Resolution against any official
or employee of the District or any person executing any Bonds.
SECTION 16.09: EFFECTIVE DATE OF RESOLUTION. This Resolution
shall take effect and be in full force and effect upon and after
its passage.
LLR\60809.1\BONDRESOLUTION2021 4 8
PASSED AND APPROVED this 27th day of September, 1999.
/s/Ricki A. Willoughby
ATTEST:
/s/Kelly C. Flanagan
President, Board of Directors
Brazoria County Municipal Utility
District No. 5
Secretary/Treasurer, Board
of Directors Brazoria County
Municipal Utility District No. 5
(SEAL)
nza\e0e09. :\BO~DRESOnU~:ON202: 4 9