Ord. 0510 03-10-86ORDINANCE NO. 510
ORDINANCE AUTHORIZING THE ISSUANCE OF $4,500,000
CITY OF PEARLAND, TEXAS, PUBLIC IMPROVEMENT BONDS,
SERIES 1986; AND DECLARING THAT A SPECIFIC AND
IMMEDIATE PUBLIC EMERGENCY EXISTS IN THAT PROCEEDS OF
SALE OF SUCH BONDS ARE REQUIRED AS SOON AS POSSIBLE TO
ACCOMPLISH THE BOND PURPOSES FOR PROTECTION OF LIFE,
HEALTH, PROPERTY AND THE PUBLIC PEACE WITHIN THE CITY
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
WHEREAS, the bonds hereinafter authorized were duly and
favorably voted at an election held in the City on the 15th
day of September, 1984; and
WHEREAS, the\City Council of the City has and does
hereby determine that bonds in the amount of $4,500,000, as a
portion and the second installment of the $13,500,000 bonds
voted at said election, should now be issued and delivered in
order to accomplish the purposes for which they were voted,
$5,000,000 bonds of said voted authorization having been
heretofore issued, sold, and delivered, and the City reserving
the right to issue the remainder of the bonds authorized at
such election at a later time; Now, Therefore
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
PEARLAND, TEXAS:
ARTICLE I
DEFINITIONS AND INTERPRETATIONS
Section 1.1: Definitions. Throughout this ordinance
the following terms and expressions as used herein shall have
the meanings set forth below:
The term "Bond" or "Bonds" shall mean any bond or all
bonds, as the case may be, of the Public Improvement Bonds,
Series 1986, authorized in this Ordinance, unless the context
clearly indicates otherwise.
The term "City" shall mean the City of Pearland, Texas.
The term "Construction Fund" shall mean the construction
fund established by the City pursuant to Article VI of this
Ordinance.
The term "Interest and Sinking Fund" shall mean the
interest and sinking fund established by the City pursuant to
Section 5.1 of this Ordinance.
The term "Interest Payment Date", when used in connec-
tion with any Bond, shall mean September 1, 1986, and each
March 1 and September 1 thereafter until maturity or earlier
redemption of such Bond.
The term "Ordinance" as used herein and in the Bonds
shall mean this ordinance authorizing the Bonds.
The term "Owner" shall mean any person who shall be the
registered owner of any outstanding Bonds.
The term "Paying Agent" shall mean the Registrar.
The term "Record Date" shall mean, for any Interest
Payment Date, the 15th calendar date of the month next
preceding such Interest Payment Date.
The term "Register" shall mean the books of registration
kept by the Registrar in which are maintained the names and
addresses of and the principal amounts registered to each
Owner.
The term "Registrar" shall mean the First City National
Bank of Houston, Houston, Texas, and its successors in that
capacity.
Section 1.2: Interpretations. All definitions of terms
used herein and 411 pronouns used in this Ordinance shall be
deemed to apply equally to singular and plural and to all
genders. The titles and headings of the articles and sec-
tions of this Ordinance 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 Ordinance and all the terms and pro-
visions hereof shall be liberally construed to effectuate the
purposes set forth herein.
ARTICLE II
TERMS OF THE BONDS
Section 2.1: Purpose and Amount. The Bonds shall be
issued in fully registered form, without coupons, in the
total authorized aggregate amount of Four Million Five
Hundred Thousand Dollars ($4,500,000) for the purpose of
providing $500,000 FOR THE CONSTRUCTION AND IMPROVEMENT OF
THE ROADS, BRIDGES, AND STREETS OF THE CITY, $2,000,000 FOR
CONSTRUCTING IMPROVEMENTS AND EXTENSIONS TO THE SANITARY
SEWER SYSTEM OF THE CITY, and $2,000,000 FOR CONSTRUCTING AND
PERMANENTLY EQUIPPING A NEW CITY HALL BUILDING FOR THE CITY.
Section 2.2: Designation, Date, and Interest. The
Bonds shall be designated as the "CITY OF PEARLAND, TEXAS,
PUBLIC IMPROVEMENT BONDS, SERIES 1986", and shall be dated
April 1, 1986. The Bonds shall bear interest from the later
of April 1, 1986, or the most recent Interest Payment Date to
which interest has been paid or duly provided for, calculated
on the basis of a 360 day year of twelve 30 day months, in-
terest payable on September 1, 1986, and semiannually there-
after on March 1 and September 1 of each year until maturity
or prior redemption.
Section 2.3: Numbers, Denomination, Interest Rates and
Maturities. The Bonds shall be issued bearing the numbers,
in the principal amounts, and bearing interest at the rates
set forth in the followingschedule, and may be transferred
and exchanged as set out in this Ordinance. The Bonds shall
mature, subject to prior redemption in accordance with this
Ordinance, on March 1 in each of the years and in the amounts
set out in such schedule. Bonds delivered in transfer of or
in exchange for other Bonds shall be numbered in order of
their authentication by the Registrar, shall be in the de-
nomination of $5,000 or integral multiples thereof, and shall
mature on the same date and bear interest at the same rate as
the Bond or Bonds in lieu of which they are delivered.
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Section 2.7: Ownership. The City, the Registrar and
any other person may treat the person in whose name any Bond
is registered as the absolute owner of such Bond for the
purpose of making and receiving payment of the principal
thereof and for the further purpose of making and receiving
payment of the interest thereon, and for all other purposes,
whether or not such Bond is overdue, and neither the City nor
the Registrar shall be bound by any notice or knowledge to
the contrary. All payments made to the person deemed to be
the Owner of any Bond in accordance with this Section 2.7
shall be valid and effectual and shall discharge the lia-
bility of the City and the Registrar upon such Bond to the
extent of the sums paid.
Section 2.8: Registration, Transfer and Exchange. So
long as any Bonds remain outstanding, the Registrar shall
keep the Register at its principal corporate trust office in
which, subject to such reasonable regulations as it may pre-
scribe, the Registrar shall provide for the registration and
transfer of Bonds in accordance with the terms of this
Ordinance.
Each Bond shall be transferable only upon the presenta-
tion and surrender thereof at the principal corporate trust
office of the Registrar, duly endorsed for transfer, or
accompanied by an assignment duly executed by the registered
Owner or his authorized representative in form satisfactory
to the Registrar. Upon due presentation of any Bond for
transfer, the Registrar shall authenticate and deliver in
exchange therefor, within 72 hours after such presentation, a
new Bond or Bonds, registered in the name of the transferee
or transferees, in authorized denominations and of the same
maturity and aggregate principal amount and bearing interest
at the same rate as the Bond or Bonds so presented.
All Bonds shall be exchangeable upon presentation and
surrender thereof at the principal corporate trust office of
the Registrar for a Bond or Bonds of the same maturity and
interest rate and in any authorized denomination, in an
aggregate principal amount equal to the unpaid principal
amount of the Bond or Bonds presented for exchange. The
Registrar shall be and is hereby authorized to authenticate
and deliver exchange Bonds in accordance with the provisions
of this Section 2.8. Each Bond delivered in accordance with
this Section 2.8 shall be entitled to the benefits and
security of this Ordinance to the same extent as the Bond or
Bonds in lieu of which such Bond is delivered.
The City or the Registrar may require the Owner of any
Bond to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with
the transfer or exchange of such Bond. Any fee or charge of
the Registrar for such transfer or exchange shall be paid by
the City.
The Registrar shall not be required to transfer or
exchange any Bond during a period beginning at the opening of
business fifteen (15) calendar days prior to the first
mailing of a notice of redemption of Bonds and ending at the
close of business on the day of such mailing.
Section 2.9: Cancellation. All Bonds paid or redeemed
in accordance with this Ordinance, and all Bonds in lieu of
which exchange Bonds or replacement Bonds are authenticated
and delivered in accordance herewith, shall be cancelled and
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ARTICLE III
OPTION OF PRIOR REDEMPTION
Section 3.1: Optional Redemption. The City reserves
the right, at its option, to redeem prior to maturity the
Bonds maturing on or after March 1, 1998, in whole or from
time to time in part, on March 1, 1997, or on any Interest
Payment Date thereafter at par plus accrued interest on the
Bonds called for redemption to the date fixed for redemption.
If less than all of the Bonds are redeemed within a stated
maturity at any time, the Bonds to be redeemed shall be
selected by the City.
Section 3.2: Partial Redemption. Principal amounts may
be redeemed only in integral multiples of $5,000. If a Bond
subject to redemption is in a denomination larger than
$5,000, a portion of such Bond may be redeemed, but only in
integral multiples of $5,000. Upon surrender of any Bond for
redemption in part, the Registrar, in accordance with Section
2.8 hereof, shall authenticate and deliver in exchange there-
for a Bond or Bonds of like maturity and interest rate in an
aggregate principal amount equal to the unredeemed portion of
the Bond so surrendered.
Section 3.3: Notice of Redemption. Notice of any
redemption identifying the Bonds to be redeemed in whole or
in part shall be given by the Registrar at least thirty days
prior to the date fixed for redemption by (i) sending written
notice by certified mail to the Owner of each Bond to be
redeemed in whole or in part at the address shown on the
Register and (ii) publication one time in a financial journal
or publication published in the City of New York, New York,
or in the City of Austin, Texas. Such notices shall state
the redemption date, the amount of accrued interest payable
on the redemption date, the place at which Bonds are to be
surrendered for payment and, if less than all Bonds out-
standing are to be redeemed, the numbers of the Bonds or
portions thereof to be redeemed. Any notice given as pro-
vided in this Section 3.3 shall be conclusively presumed to
have been duly given, whether or not the Owner receives such
notice. By the date fixed for redemption, due provision
shall be made with the Registrar for payment of the redemp-
tion price of the Bonds or portions thereof to be redeemed,
plus accrued interest to the date fixed for redemption. When
Bonds have been called for redemption in whole or in part and
due provision has been made to redeem same as herein provided,
the Bonds or portions thereof so redeemed shall no longer be
regarded as outstanding except for the purpose of receiving
payment solely from the funds so provided for redemption, and
the rights of the Owners to collect interest which would
otherwise accrue after the redemption date on any Bond or
portion thereof called for redemption shall terminate on the
date fixed for redemption.
ARTICLE IV
FORM OF BONDS AND CERTIFICATES
Section 4.1: Form of Bonds. The Bonds shall be in sub-
stantially the following form, with such additions, deletions
and variations as may be necessary or desirable and permitted
by this Ordinance:
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THE ROADS, BRIDGES, AND STREETS OF THE CITY, $2,000,000 FOR
CONSTRUCTING IMPROVEMENTS AND EXTENSIONS TO THE SANITARY
SEWER SYSTEM OF THE CITY, and $2,000,000 FOR CONSTRUCTING AND
PERMANENTLY EQUIPPING A NEW CITY HALL BUILDING FOR THE CITY,
and pursuant to an ordinance adopted by the City Council on
March 10, 1986 (the "Ordinance").
THE CITY RESERVES THE RIGHT, at its option, to redeem
the Bonds maturing on or after March 1, 1998, prior to their
scheduled maturities, in whole or from time to time in part,
in integral multiples of $5,000, on March 1, 1997, or on any
interest payment date thereafter at par plus accrued interest
on the principal amounts called for redemption to the date
fixed for redemption. Reference is made to the Ordinance for
complete details concerning the manner of redeeming the
Bonds.
NOTICE OF ANY REDEMPTION shall be given at least thirty
(30) days prior to the date fixed for redemption by certified
mail, addressed to the registered owners of each Bond to be
redeemed in whole or in part at the address shown on the
books of registration kept by the Registrar and by publica-
tion once in a financial journal or publication published in
the City of New York, New York, or in the City of Austin,
Texas. When Bonds or portions thereof have been called for
redemption, and due provision has been made to redeem the
same, the principal amounts so redeemed shall be payable
solely from the funds provided for redemption, and interest
which would otherwise accrue on the amounts called for
redemption shall terminate on the date fixed for redemption.
THIS BOND IS TRANSFERABLE only upon presentation and
surrender at the principal corporate trust office of the
Registrar, duly endorsed for transfer or accompanied by an
assignment duly executed by the registered owner or his
authorized representative, subject to the terms and condi-
tions of the Ordinance.
THE BONDS ARE EXCHANGEABLE at the principal corporate
trust office of the Registrar for bonds in the principal
amount of $5,000 or any integral multiple thereof, subject to
the terms and conditions of the Ordinance.
THE REGISTRAR SHALL NOT BE REQUIRED to transfer or
exchange any Bond during a period beginning at the opening of
business fifteen (15) calendar days prior to the first
mailing of a notice of redemption of Bonds and ending at the
close of business on the day of such mailing.
THIS BOND SHALL NOT BE valid or obligatory for any pur-
pose or be entitled to any benefit under the Ordinance unless
this Bond either (i) is registered by the Comptroller of
Public Accounts of the State of Texas by registration cer-
tificate endorsed hereon or (ii) is authenticated by the
Registrar by due execution of the authentication certificate
endorsed hereon.
IT IS HEREBY CERTIFIED, RECITED AND COVENANTED that this
Bond has been duly and validly issued and delivered; that all
acts, conditions and things required or proper to be per-
formed, to exist and to be done precedent to or in the issu-
ance and delivery of this Bond have been performed, exist and
have been done in accordance with law; and that annual
ad valorem taxes sufficient to provide for the payment of the
interest on and principal of this Bond, as such interest
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Section 4.5: Opinion and CUSIP Numbers. The approving
opinion of Vinson & Elkins, Houston, Texas, and CUSIP Numbers
may be printed on the Bonds, but errors or omissions in the
printing of such opinion or such numbers shall have no effect
on the validity of the Bonds.
ARTICLE V
SECURITY AND SOURCE OF PAYMENT FOR BONDS
Section 5.1: Interest and Sinking Fund. The proceeds
from all taxes levied, assessed and collected for and on
account of the Bonds authorized by this Ordinance shall be
deposited, as collected, in a special fund to be designated
"City of Pearland, Texas, Public Improvement Bonds, Series
1986, Interest and Sinking Fund". While said Bonds or any
part of the principal thereof or interest thereon remain
outstanding and unpaid, there is hereby levied and there
shall be annually'levied, assessed and collected in due time,
form and manner, and at the same time other City taxes are
levied, assessed and collected, in each year, beginning with
the current year, a, continuing direct annual ad valorem tax
upon all taxable property in said City sufficient to pay the
current interest on said Bonds as the same becomes due, and
to provide and maintain a sinking fund adequate to pay the
principal of the Bonds as such principal matures but never
less than two per cent (2%) of the original principal amount
of the Bonds each year, full allowance being made for delin-
quencies and costs of collection, and said taxes when col-
lected shall be applied to the payment of the interest on and
principal of said Bonds and to no other purpose. In addi-
tion, interest accrued from the date of the Bonds until their
delivery,and premium if any, is to be deposited in such
fund.
Section 5.2: Investment of Interest and Sinking Fund.
Money in the Interest and Sinking Fund may, at the option of
the City, be invested in time deposits or certificates of
deposit secured in the manner required by law for public
funds, or be invested in direct obligations of, or obliga-
tions the principal of and interest on which are uncondition-
ally guaranteed by, the United States of America, in obliga-
tions of any agencies or instrumentalities of the United
States of America or as otherwise permitted by state law;
provided that all such deposits and investments shall be made
in such manner (which may include repurchase agreements for
such investments with any national bank) that money required
to be expended from the Interest and Sinking Fund will be
available at the proper time or times. All such investments
shall be valued in terms of current market value no less
frequently than the last business day of the City's Fiscal
Year, except that any direct obligations of the United States
of America - State and Local Government Series shall be con-
tinuously valued at their par value or principal face amount.
Any obligation in which money is so invested shall be kept
and held in an official depository of the City, except as
hereinafter provided. For purposes of maximizing investment
returns, money in such Interest and Sinking Fund may be in-
vested, together with money in the Construction Fund or with
other money of the City, in common investments of the kind
described above, or in a common pool of such investments
which shall be kept and held at an official depository of the
City, which shall not be deemed to be or constitute a com-
mingling of such money or Funds provided that safekeeping
receipts or certificates of participation clearly evidencing
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ARTICLE VII
PROVISIONS CONCERNING SALE AND
DISPOSITION OF PROCEEDS OF BONDS
Section 7.1: Sale of Bonds. The sale of the Bonds to
(herein referred to as the "Purchaser") at the price of par
and accrued interest thereon to date of delivery, plus a cash
premium of $ , is hereby authorized, approved, ratified
and confirmed, subject to the unqualified approving opinion
as to the legality of the Bonds of the Attorney General of
the State of Texas, and of Vinson & Elkins, Houston, Texas,
bond counsel.
Section 7.2: Approval, Registration and Delivery.
After the Bonds to be initially issued shall have been exe-
cuted, it shall be the duty of the Mayor of the City to
deliver the Bonds to be initially issued and all pertinent
records and proceedings to the Attorney General of Texas, for
examination and approval by the Attorney General. After the
Bonds to be initially issued shall have been approved by the
Attorney General, they shall be delivered to the Comptroller
of Public Accounts of the State of Texas for registration.
Upon registration of the Bonds to be initially issued, the.
Comptroller of Public Accounts (or a deputy lawfully desig-
nated in writing to act for the Comptroller) shall manually
sign the Comptroller's Registration Certificate prescribed
herein to be printed and endorsed on the Bonds to be ini-
tially issued, and the seal of said Comptroller shall be,
impressed, or placed in facsimile, thereon.
Section 7.3: No Arbitrage. The City specifically
covenants that, unless it receives an opinion of nationally
recognized bond counsel to the effect that failure to do so
will not cause interest on the Bonds to become subject to
federal income taxation, the City will comply with the
provisions of H.R. 3838, adopted by the House of Representa-
tives of the Congress of the United States of America on
December 17, 1985, including, without limitation, compliance
with the provisions of H.R. 3838 regarding the timing of the
expenditure of the proceeds of the Bonds, the use of such
proceeds and the facilities financed with such proceeds, the
restriction of investment yields, the filing of information
with the Internal Revenue Service, and the rebate of arbitrage
profit to the United States. Further, the City certifies
that based upon all facts and estimates now known or reason-
ably expected to be in existence on the date the Bonds
initially issued are delivered and paid for, the City reason-
ably expects that the proceeds of the Bonds will not be used
in a manner that would cause the Bonds or any portion of the
Bonds to be an "arbitrage bond" under Section 103(c)(2) of
the Internal Revenue Code of 1954, as amended, and the regu-
lations prescribed thereunder. Furthermore, all officers,
employees and agents of the City are authorized and directed
to provide certifications of facts and estimates that are
material to the reasonable expectations of the City as of the
date the Bonds initially issued are delivered and paid for.
In particular, all or any officers of the City are authorized
to certify for the City the facts and circumstances and
reasonable expectations of the City on the date the Bonds
initially issued are delivered and paid for regarding the
amount and use of the proceeds of the Bonds. Moreover, the
City covenants that it shall make such use of the proceeds of
the Bonds, regulate investments of proceeds of the Bonds and
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Ordinance is adopted at the time and place held; the meeting
at which this Ordinance was adopted was open to the public,
and public" notice of the time, place and purpose of said
meeting was given, all as required by Vernon's Ann. Tex. Civ.
St. Article 6252-17, as amended; and that such notice as
given is hereby authorized, approved, adopted and ratified.
Section 8.6: Effect of Ordinance. This Ordinance shall
be in force and effect from and after its passage, and it is
so ordered.
Section 8.7: Repealer. All orders, resolutions and
ordinances, or parts thereof, inconsistent herewith are
hereby repealed to the extent of such inconsistency.
PASSED AND APPROVED this loth day of Marc 1986.
Mayor
CITY OF PEARLAND, TEXAS
ATTEST:
City Sicretary
CITY OF PEARLAND, TEXAS
(SEAL)
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take such other and further actions as may be required so
that the Bonds shall not be "arbitrage bonds" under Section
103 (c) (2) -of-the Internal Revenue Code of 1954, as amended,
and the regulations prescribed from time to time thereunder.
ARTICLE VIII
ii
MISCELLANEOUS
Section 8.1: Official Statement. The City ratifies and
confirms its prior approval of the form and content of the
Official Statement prepared for initial offering and sale of
the Bonds and hereby approves the form and content of any
addenda, supplement, or amendment thereto. The use of such
Official Statement in the reoffering of the Bonds by the
Purchaser is hereby approved and authorized. The proper
officials of the City are hereby authorized to execute and
deliver a certificate pertaining to such Official Statement
as prescribed therein, dated as of the date of payment for
and delivery of the Bonds.
Section 8.2: Provisions Concerning Registrar. (a) The
Registrar, by undertaking the performance of the duties of
the Registrar and in consideration of the payment of fees
and/or deposits of moneypursuant to this Ordinance and a.
Paying Agent/Registrar Agreement, accepts and agrees to abide
by the terms of this Ordinance and such Agreement. The City
hereby approves the Paying Agent/Registrar Agreement.
(b) The City reserves the right to replace the Regis-
trar or its successor at any time. If the Registrar is
replaced by the City, the new Registrar shall accept the
previous Registrar's records and act in the same capacity as
the previous Registrar. Any successor Registrar shall be
either a national or state banking institution and a corpora-
tion organized and doing business under the laws of the .
United States of America or any State authorized under such
laws to exercise trust powers and subject to supervision or
examination by Federal or State authority.
Section 8.3: Further Procedures. The Mayor, and the
City Secretary and other appropriate officials of the City
are hereby authorized and directed to do any and all things
necessary and/or convenient to carry out the terms and
purposes of this Ordinance.
Section 8.4: Severability. If any Section, paragraph,
clause or provision of this Ordinance shall for any reason be
held to beinvalid or unenforceable, the invalidity or unen-
forceability of such Section, paragraph, clause or provision
shall not affect any of the remaining provisions of this
Ordinance.
Section 8.5: Declaration of Emergency; Open Meeting.
It is hereby officially found and determined that this
Ordinance relates to an immediate public emergency affecting
life, health, property and the public peace, and that such
,,• •L_ 4
the investment or investment pool in which such money is
invested and the share thereof purchased with such money or
owned by such Fund are held by or on behalfof each such
Fund. If necessary, such investmentsshall be promptly sold
to prevent any default. All interest and income derived from
such deposits and investments of the Interest and Sinking
Fund shall be credited to the Interest and Sinking Fund. So
long as any Bonds remain outstanding, all uninvested moneys
on deposit in, or credited to, the Interest and Sinking Fund
shall be secured by the pledge of security, as provided by
law for cities in the State of Texas.
ARTICLE VI
CONSTRUCTION FUND
Section 6.1: Construction Fund. There is hereby
created and established a special fund of the City, to be
known as the "City of Pearland, Texas, Public Improvement
Bonds, Series 1986, Construction Fund", which shall be.
maintained as a separate account on the books of the City.
Money on deposit in the Construction Fund shall be used only
for the purposes set,forth in Section 2.1 of this Ordinance,
except that interest, and income, derived from deposit and
investment of moneys in the Construction Fund may be utilized
as provided below in Section 6.2 hereof.
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Section 6.2: Investment of Money in Construction Fund.
Money on deposit in the Construction Fund may, at the option
of the City, be invested as permitted by Texas law; provided
that all such deposits and investments shall be made in such
manner (which may include repurchase agreements for such
investments with any national bank) that the money required
tobe -expended from the Construction Fund will be available
at the proper time or times. All such investments shall be.
valued in terms of current market value no lessfrequently
than the last business day of the City's Fiscal Year, except
that any direct obligations of the United States of America
-- State and Local Government Series shall be continuously
valued at their par value or principal face amount. Any
obligation in which money is so invested shall be kept and
held in an official depository of the City, except as herein-
after provided. For purposes of maximizing investment re-
turns, money in theConstruction Fund may be invested,
together with money in the Interest and Sinking Fund or with
other money of the City, in common investments of the kind
described above, or in a common pool of such investments
which shall be kept and held at an official depository of the
City, which shall not be deemed to be or constitute a com-
mingling of such money or Funds provided that safekeeping
receipts or certificates of participation clearly evidencing
the investment or investment pool in which such money is
invested and the share thereof purchased with such money or
owned by the Construction Fund are held by or on behalf of
the Construction Fund. All interest and income derived from
such deposits and investments shall remain in the Construc-
tion Fund, except that (a) to the extent required by law,
comes due and such principal matures, have been levied and
ordered to be levied against all taxable property in the City
within the limits prescribed by the Constitution and laws of
the State of Texas, and have been pledged irrevocablyfor
such payment.
Section 4.2: Registration of Bonds by State Comptroller.
Bonds No. R-1 through R-17 shall be registered by the Comp-
troller of Public Accounts of the State of Texas, as provided
by law. The registration certificate of the Comptroller of
Public Accounts shall be printed on Bonds R-1 through R-17
and shall be in substantially the following form:
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO.
I HEREBY CERTIFY that this bond has been examined, cer-
tified as to validity, and approved by the Attorney General
of the State of Texas, and that this bond has been registered
by the Comptroller of Public Accounts of the State of Texas.
WITNESS MY SIGNATURE AND SEAL this
(SEAL)
xxxxxxxxxx
Comptroller of Public Accounts
.of the State of Texas
Section 4.3: Form of Authentication Certificate. The
following form of authentication certificate shall be printed
on the face of each of the Bonds:
Registration Date:
AUTHENTICATION CERTIFICATE
This bond is one of the bonds
described in and delivered
pursuant to the within -mentioned
Ordinance.
FIRST CITY NATIONAL BANK OF HOUSTON
Houston, Texas
By
Authorized Officer
Section 4.4: Form of Assignment. The following form of
assignment shall be printed on the back of each of the Bonds:
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells,
assigns, and transfers unto (print or typewrite name, address,
and zip code of transferee):
•
number:
(Social Security or other identifying
) the within bond and all rights
thereunder, and hereby irrevocably constitutes and appoints
attorney
to transfer said bond on the books kept for registration
NUMBER
R- - •
REGISTERED
(Face.of Bond)
UNITED STATES OF.AMERICA
STATE OF TEXAS
COUNTIES OF BRAZORIA AND HARRIS
CITY OF PEARLAND, TEXAS .
PUBLIC IMPROVEMENT BOND, SERIES 1986
INTEREST RATE: MATURITY DATE:
REGISTERED OWNER:
PRINCIPAL AMOUNT:'\ DOLLARS
THE CITY OF PEARLAND, TEXAS (the "City") promises to pay
to the Registered Owner identified above, or registered
assigns,..on.the date; specified above, upon presentation and
surrenderof this bond at the principal corporate trust
office of the FIRST CITY NATIONAL BANK OF HOUSTON, HOUSTON,.,
TEXAS(the"Registrar"), the principal amount identified
above, payable in any coin or currency of the United States.
of America which on the date of payment of such principal is
legal tender for the payment of debts due the United States
of America, and to pay interest thereon at the rate shown,
above, calculated on the basis of a 360 day year of twelve
30 day months, from the later of April 1, 1986, or the most
recent interest payment date to which interest has been paid
or duly provided for. Interest on this bond is payable by
check or draft payable on September 1, 1986 and semiannually
thereafter on each March 1 and September 1, mailed to the
registered owner as shown on the books of registration kept
by the Registrar as of the 15th calendar date of the month
next preceding each interest payment date.
DENOMINATION
REGISTERED
ISSUE DATE: CUSIP NO.
APRIL 1, 1986
REFERENCE IS -HEREBY MADE TO THE FURTHER PROVISIONS OF
THIS BOND SET FORTH ON THE REVERSE HEREOF, WHICH' PROVISIONS
SHALL HAVE THE SAME FORCE AND EFFECT AS IF SET FORTH AT THIS
PLACE. •
IN WITNESS WHEREOF, this bond has been signed with the
manual or facsimile signature of the Mayor of the City and
countersigned with the manual or facsimile signature of the
City Secretary of the City, and the official seal of the City
has been duly impressed, or placed in facsimile, on this
bond.
(AUTHENTICATION CERTIFICATE) (SEAL) 'CITY ---OF PEARLAND,-TEXAS
Mayor
destroyed upon the making of proper records regarding such
payment or redemption. The Registrar shall furnish the City
with appropriate certificates of destruction of such Bonds.
Section 2.10: Replacement Bonds. Upon the presentation
and surrender to the Registrar of a mutilated Bond, the
Registrar shall authenticate and deliver in exchange therefor
a replacement Bond of like maturity, interest rate and prin-
cipal amount, bearing a number not contemporaneously out-
standing. The City or the Registrar may require the Owner of
such Bond to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection there-
with and any other expenses connected therewith, including
the fees and expenses of the Registrar.
If any Bond is lost,apparently destroyed., or wrongfully
taken, the City, pursuant to the applicable laws of the State
of Texas and in the absence of notice or knowledge that such
Bond has been acquired by a bona fide purchaser, shall exe-
cute and the Registrar shall authenticate and deliver a re-
placement Bond of like maturity, interest rate and principal
amount, bearing a number not contemporaneously outstanding,
provided that the Owner thereof shall have:
(a) furnished to the City and the Registrar
satisfactory evidence of the ownership of and the
circumstances of the loss, destruction or theft of such
Bond;
(b) furnished such security or indemnity as may be
required by the Registrar and the City to save them
harmless;
(c) paid all expenses andcharges in connection
therewith, including, but not limited to, printing
costs, legal fees, fees of the Registrar and any tax or
other governmental charge that may be imposed; and
(d) met any other reasonable requirements of the
City and the Registrar.
If, after the delivery of such replacement Bond, a bona fide
purchaser of the original Bond in lieu of which such replace-
ment Bond was issued presents for payment such original Bond,
the City and the Registrar shall be entitled to-recover'such
replacement Bond from the person to whom it was delivered or
any person taking therefrom, except a bona fide. purchaser,
and shall be entitled to recover upon the security or indem-
nity provided therefor to the extent of any loss, damage,
cost or expense incurred by the City or the Registrar in
connection therewith.
If any such mutilated, lost, apparently destroyed or
wrongfully taken Bond has become or is about to become due
and payable, the City in its discretion may, instead of
issuing a replacement Bond, authorize the Registrar to pay
such Bond.
Bond
Number
Year
Principal Interest
Amount Rate
R- 1 1987 $ 50,000
R- 2 1988 50,000
R- 3 1989 75,000
R- 4 1990 75,000.
R- 5 1991 100,000
R- 6 1992 125,000
R- 7 1993 125,000
R- 8 1994 150,000
R- 9 1995 175,000
R-10 1996 300,000
R-11 1997 425,000
R-12 1998 450,000
R-13 1999 . 450,000
R-14 2000 475,000
R-15 2001 475,000
R-16 \ 2002 500,000
R-17 2003 500,000
8.50 %
8.50 %
8.50 %
8.50 %
g.50 %
8.50 %
8.50 %
8.50 %
8.50 %
8.50 %
6.50 %
6.60 %
6.60 %
6.70 %
6.75 %
6.80 %
6.50 %
Section 2.4: Execution of Bonds. The .Bonds shall be
signed by the Mayor of the City and countersigned by the City
Secretary of the City, by their manual, lithographed, or fac-
simile signatures, and the official seal of the City shall be
impressed or placed in facsimile thereon. Such facsimile
signatures on the Bonds shall have the same effect as if each
of the Bonds had been signed manually and in person by each
of said officers, and such facsimile seal on the Bonds shall
have the same effect as if the official seal of the City had
been manually impressed upon each of the Bonds. If any
officer of the City whose manual or facsimile signature shall
appear on the Bonds shall cease to be such officer before the
authentication of such Bonds or before the delivery of such
Bonds, such manual or facsimile signature shall nevertheless
be valid and sufficient for all purposes as if such officer
had remained in such office.
Section 2.5: Authentication. Only such Bonds as shall
bear thereon either (i) the manually executed registration
certificate of the Comptroller of Public Accounts of Texas
substantially in the form provided in Section 4.2 of this
Ordinance or (ii) a certificate of authentication, substan-
tially in the form provided in Section 4.3.of this Ordinance,
manually executed by an authorized officer of the Registrar,
shall be entitled to the benefits of this Ordinance or shall
be valid or obligatory for any purpose. Such duly executed
certificate of authentication shall be conclusive evidence
that the Bond so authenticated was delivered by the Registrar
hereunder. -
Section 2.6: Medium and Place of Payment. The Regis-
trar is hereby appointed as the Paying Agent for the Bonds.
The principal of the Bonds shall be payable, without exchange
or collection charges, in any coin or currency of the United
States of America, which, on the date of payment, is legal
tender for the payment of debts due the United States of
nnri cairranArbr aG i-hAv become
CERTIFICATE FOR ORDINANCE
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND-HARRIS. §
CITY OF PEARLAND §•
We, the undersigned officers of the CITY OF PEARLAND, TEXAS (the
"City"), hereby certify as follows:
1. The_ City Council of the City convened in regular meeting on.
the loth day of March, 1986, at the regular meeting place thereof,.
within the City, and the roll was called of the duly constituted offi-
cers and members of the City Council and the City Secretary, to -wit:
Tom Reid
James E. Bost
Dennis M. Frauenberger
Terry Gray
Alfred E. Lentz
Richard F. Tetens
Kay Krouse '
Mayor
Mayor Pro Tem
Councilman
Councilman
Councilman
Councilman
City Secretary
and all of said persons were present, except the following absentees:
thus constituting' a quorum.,
Whereupon, -among other business, the following was transacted.at said
meeting: a written
ORDINANCE AUTHORIZING THE ISSUANCE OF $4,500;000 CITY OF
PEARLAND, TEXAS, PUBLIC IMPROVEMENT BONDS, SERIES'1986; AND,
DECLARING THAT A SPECIFIC AND IMMEDIATE PUBLIC EMERGENCY EXISTS
IN THAT PROCEEDS OF SALE OF SUCH BONDS ARE REQUIRED AS SOON AS
POSSIBLE TO ACCOMPLISH THE BOND PURPOSES FOR PROTECTION OF
LIFE,_HEALTH, PROPERTY AND THE PUBLIC PEACE WITHIN THE CITY
none
(the "Ordinance") was duly introduced for the consideration of the City
Council and read in full. It was then duly moved and seconded that the
Ordinance be adopted; and, after due discussion, said motion, carrying
with it the adoption of the Ordinance, prevailed and carried by the
following vote:
AYES: All members of the City Council shown present above
voted "Aye".
NAYS: None.
2. That a true, full and correct copy of the Ordinance adopted
at the meeting described in the above and foregoing paragraph is
attached to and follows this certificate; that the Ordinance has been
duly recorded in the City Council's minutes of said meeting; that the
above and foregoing paragraph is a true, full and correct excerpt from
the City Council's minutes of said meeting pertaining to the adoption
of the Ordinance; that the persons named in the above and foregoing
paragraph are the duly chosen, qualified and acting officers and
members of the City Council as indicated therein; that each of the
officers and members of the City Council was duly and sufficiently
notified officially and personally, in advance, of the date, hour,
place and subject of the aforesaid meeting, and that the Ordinance
would be introduced and considered for adoption at said meeting, and
each of said officers and members consented, in advance, to the holding
of such meeting for such purpose; that said meeting was open to the
ri l,l i r. � c rcrr7i i rct� hx7 law- anrl i-ha+ rlllh1 l c nr 1- i C•_e_ of the date. hour.
r- r"- r -"NI
CITY OF PEARLAND, TEXAS
PUBLIC IMPROVEMENT BONDS
SERIES 1986
* * * * * * * *
$4 ,500 , 000
* * * * * * * *
8 . 50% , 6 . 50% , 6 . 60% ,
6 . 70% , 6 . 75% , 6 . 80% and 6 . 50%
CITY OF PEARLAND, TEXAS
PUBLIC IMPROVEMENT BONDS
SERIES 1986
* * * * * * * *
$4 ,500 , 000
* * * * * * * *
8 .50% , 6 . 50% , 6 . 60% ,
6 .70% , 6 . 75% , 6 . 80% and 6 . 50%
CITY OF PEARLAND, TEXAS
PUBLIC IMPROVEMENT BONDS
SERIES 1986
$4 ,500 , 000
Document No.
Vinson & Elkins Opinion 1
General Certificate 2
Official Notice of Sale and Official Statement 3
Notice of Meeting and Certificate of Posting 4
Winning Bid 5
Certified copy of Bond Ordinance 6
Appropriation Certificate 7
Certificate of Assessed Valuation 8
Signature Identification and No-Litigation
Certificate 9
Attorney General' s Opinion and Comptroller ' s
Registration Certificate 10
First City National Bank of Houston
Authorization Resolution 11
Paying Agent/Registrar Agreement 12
FGIC Insurance Policy and Opinion 13
Official Statement Certificate 14
No-Arbitrage Certificate 15
VINSON & ELKINS
ATTORNEYS AT LAW
FIRST CITY TOWER
HOUSTON, TEXAS 77002
APR 1 5 1986
WE HAVE ACTED as bond counsel for the City of Pearland,
Texas (the "City" ) , in connection with an issue of bonds (the
"Bonds" ) described as follows:
CITY OF PEARLAND, TEXAS, PUBLIC IMPROVEMENT BONDS,
SERIES 1986 , dated April 1 , 1986 , in the total
authorized aggregate amount of $4 ,500 , 000 , matur-
ing on March 1 in each year as follows:
$ 50 ,000 1987
50 ,000 1988
75 ,000 1989
75 ,000 1990
100 , 000 1991
125 ,000 1992
125 , 000 1993
150 ,000 1994
175 ,000 1995
300 ,000 1996
425 , 000 1997
450 ,000 1998
450 , 000 1999
475 ,000 2000
475, 000 2001
500 ,000 2002
500 , 000 2003
The Bonds bear interest, are subject to redemption
prior to maturity, and may be transferred and
exchanged as set out in the Bonds and in the ordi-
nance adopted by the City Council of the City
authorizing their issuance (the "Ordinance" ) .
WE HAVE ACTED as bond counsel for the sole purpose of
rendering an opinion with respect to the legality and validity
of the Bonds under the Constitution and laws of the State of
Texas, under which the City is acting as a home-rule city of
the State of Texas, and with respect to the exemption of in-
terest on the Bonds from federal income taxation. We have
not investigated or verified original proceedings, records,
data or other material, but have relied solely upon the tran-
script of certified proceedings described in the following
paragraph. We have not assumed any responsibility with
respect to the financial condition or capabilities of the
City or the disclosure thereof in connection with the sale of
the Bonds. Our role in connection with the City' s Official
Statement prepared for use in connection with the sale of the
Bonds has been limited as described therein.
IN OUR CAPACITY as bond counsel, we have participated in
the preparation of and have examined a transcript of certi-
fied proceedings pertaining to the Bonds which contains cer-
tified copies of certain proceedings of the City, customary
certificates of officers, agents and representatives of the
City and other public officials and other certified showings
BASED ON SUCH EXAMINATION, IT IS OUR OPINION that the
transcript of certified proceedings evidences complete legal
authority for the issuance of the Bonds in full compliance
with the Constitution and laws of the State of Texas pres-
ently effective and that therefore the Bonds constitute valid
and legally binding obligations of the City, and that taxable
property within the City is subject to the levy of ad valorem
taxes, within the limits prescribed by law, to pay the Bonds
and the interest thereon.
THE RIGHTS OF THE HOLDERS of the Bonds are subject to
the applicable provisions of the federal bankruptcy laws and
any other similar laws affecting the rights of creditors of
political subdivisions generally.
IT IS OUR FURTHER OPINION that the interest on the Bonds
is exempt from federal income taxes under the law existing on
the date of this opinion. The exemption of interest on the
Bonds from federal income taxes may depend, in part, upon
continuing compliance by the City with certain covenants
relating to the requirements of H.R. 3838 , the "Tax Reform
Act of 1985" , which if enacted in its current form, would
apply to obligations , including the Bonds, issued on or after
January 1 , 1986 . If H.R. 3838 or similar legislation is
finally enacted with a January 1 , 1986 effective date for
provisions relating to tax-exempt obligations such as these
Bonds , noncompliance with the foregoing covenants will cause
interest on the Bonds to become taxable retroactive to the
date of issue of the Bonds . However, it is our opinion that
if H.R. 3838 is enacted in its present form and the City
complies with the aforementioned covenants, interest on the
Bonds will continue to be exempt from federal income taxes,
except that, in the case of property and casualty insurance
companies, the interest on the Bonds may be subject to an
alternative minimum tax during any period when such Bonds are
held by such companies /for taxable years beginning after
1987 .
GENERAL CERTIFICATE
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
I , the undersigned, City Secretary of the CITY OF
PEARLAND, TEXAS (the "City") , hereby make and execute this
certificate for the benefit of the Attorney General of Texas
and all other persons interested in the City' s $4 , 500, 000
PUBLIC IMPROVEMENT BONDS, SERIES 1986 , dated April 1 , 1986 ,
now in process of issuance. I certify that:
1 . The following persons are the members of the City
Council of the City:
Tom Reid Mayor
James E . Bost Mayor Pro Tem
Dennis M. Frauenberger Councilman
Terry Gray Councilman
Alfred E. Lentz Councilman
Richard F. Tetens Councilman
2 . Kay Krouse is City Secretary and Barbara J. Lenamon
is City Tax Assessor-Collector of the City.
3 . The Home-Rule Charter of the City has not been
amended, altered, changed, or repealed since the issuance of
the City' s Refunding Bonds, Series 1985 , dated August 15,
1985 , Comptroller' s Registration No. 48739 .
4 . As to the election held September 15 , 1984 , the
City has complied with the Federal Voting Rights Act of 1965 ,
as amended, and the Texas Election Code.
5 . The following is a true, correct and complete
statement of all indebtedness of the City payable from
taxation:
Purpose Date Interest Maturities Amt. Outst.
Brazoria
Co. WC&ID
#3 WW&SS
„_� 1 L 1 A 1 L1 A nno ' nit' A 1 1 n0L /0'7 nn nnn
Purpose Date Interest Maturities Amt. Outst.
WW&SSS
Ser. ' 64 12-1-64 3 . 75% $ 30M 6-1-1986
3 . 80% 35M 1987
45M 1988
50M 1989/91
3 . 90% 55M 1992/94 $ 425 , 000
G.O.
Ser. ' 66 6-1-66 4 . 30% 30M 6-1-1986/88
4 . 35% 30M 1989/90
35M 1991
4 . 40% 35M 1992/93
40M 1994
100M 1995 395 ,000
G.O.
Ser. ' 68 8-1-68 5 . 00% 30M 2-1-1987
35M 1988/89
5 . 10% 40M 1990/91
5-1/4% 40M 1992
50M 1993/95 370 ,000
G.O.
Ser. ' 75 6-1-75 5 .90% 45M 2-1-1987
6 . 00% 50M 1988/89
6 . 10% 55M 1990
6 . 25% 60M 1991
6 . 40% 65M 1992
6 .50% 65M 1993 390 ,000
Cert. of
Oblig.
Ser. ' 76 7-1-76 6 . 25% 25M 8-1-1986 25 ,000
Cert. of
Oblig.
Ser. ' 76A 7-1-76 6 . 25% 5M 8-1-1986
35M 1987/88
40M 1989
1M 1990 116 ,000
Cert. of
Oblig.
Ser. ' 78 5-1-78 5 . 00% 60M 2-1-1987/88 120 ,000
Cert. of
Oblig.
Ser. ' 78A 6-1-78 6 .00% 5M 2-1-1987 5 ,000
Perm. Imp.
Ser. ' 78 9-1-78 5 . 90% 30M 3-1-1987
4 . 90% 50M 1988
5 . 00% 125M 1989/90
5 . 10% 125M 1991
5 . 20% 125M 1992
5.25% 125M 1993
5 . 30% 200M 1994
5 . 40% 200M 1995
5 . 50% 250M 1996/97 1 ,605 , 000
Purpose Date Interest Maturities Amt. Outst.
Cert. of
Oblig.
Ser. ' 80 9-1-80 6 . 50% $ 65M 3-1-1987
60M 1988
55M 1989 $ 180 ,000
WW Cert.
of Oblig.
Ser. ' 81 6-1-81 9 . 25% 100M 3-1-1990
9 . 40% 100M 1991
9 . 75% 100M 1992/93 400 ,000
Refunding
Ser. ' 85 8-15-85 5 . 50% 545M 3-1-1987
6 . 20% 610M 1988
6 . 70% 645M 1989
7 . 00% 705M 1990
7 . 25% 770M 1991
7 . 50% 830M 1992
7 . 75% 915M 1993
8 . 00% 1095M 1994
8 . 10% 1190M 1995
8 . 25% 1285M 1996
8 . 40% 1280M 1997
8 . 50% 510M 1998
8 . 60% 500M 1999
8 . 70% 490M 2000
8 . 80% 485M 2001 11 ,855 ,000
BONDS IN PROCESS OF ISSUANCE
Pub. Imp.
Ser. ' 86 4-1-86 50M 3-1-1987/88
75M 1989/90
100M 1991
125M 1992/93
150M 1994
175M 1995
300M 1996
425M 1997
450M 1998/99
475M 2000/01
500M 2002/03 4 ,500 ,000
TOTAL $20 , 406 , 000
WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this
10th day of March, 1986 .
City Se retary
CITY OF PEARLAND, TEXAS
(SEAL)
NOTICE OF MEETING
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
NOTICE is hereby given of a meeting of the City Council
of the CITY OF PEARLAND, Brazoria and Harris Counties, Texas
(the "City") , to be held on the 10th day of March, 1986 , at
7 : 30 p.m. in the:
City Council Chambers
City Hall
Pearland, Texas
for the purpose of adopting an ordinance authorizing issuance
of $4 ,500 , 000 public improvement bonds and for the purpose of
conducting, considering, and acting upon such other business
as shall come before the meeting.
The need of the City for such financing creates an
emergency and an urgent public necessity for the holding of
the meeting and for the adoption of the bond ordinance at the
meeting.
WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this
7 day of March, 1986 .
/s/ Kay Krouse
City Secretary
CITY OF PEARLAND, TEXAS
(SEAL)
CERTIFICATE OF POSTING OF
NOTICE OF MEETING
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
I , the undersigned officer of the CITY OF PEARLAND,
Brazoria and Harris Counties, Texas (the "City") , do hereby
execute this certificate for the benefit of all persons
interested in the posting of notice of a meeting of the City
Council of the City as required by the Open Meetings Act
(Article 6252-17 , Vernon' s Texas Civil Statutes, as amended)
and the validity of all actions and proceedings taken at
such meeting and I do hereby certify as follows:
1 . I am the duly chosen, qualified and acting officer
of the City for the office shown beneath my signature, and
in such capacity I am familiar with the matters contained in
this certificate.
2 . The attached and foregoing is a true and correct
copy of the Notice of Meeting which was posted by me at
2 :00 o' clock p .m. on the 7 day of March , 1986 ,
in a place readily accessible to the general public at all
times, to-wit: bulletin boards
in the City Hall of the City.
WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this
7 day of March , 1986 .
/&41- 2,g7e7.4.¢.1
City Sw retary
CITY OF PEARLAND, TEXAS
(SEAL)
r-)G-
OFFICIAL BID FORM
Mayor and City Council
City of Pearland
City Hall
2335 North Texas
Pearland, Texas
Gentlemen:
We have read in detail the Official Notice of Sale and accompanying Preliminary
Official Statement of City of Pearland (the "City"), relating to its $4,500,000 Public
Improvement Bonds, Series 1986 (the "Bonds"). We hereby offer to purchase the Bonds,
described in your Official Notice of Sale and Preliminary Official Statement, upon the
terms and conditions set forth in such Official Notice of Sale, which terms and conditions
are incorporated herein by reference for all purposes, for a price of par value thereof,
plus accrued interest, to the date the Bonds are delivered to us, plus a cash premium of
$ No.vtt , provided such Bonds bear interest at the following rates:
Maturity Interest Rate Maturity Interest Rate
3-1-1987 r.. So % 3-1-1996 d so %
3-1-1988 So % 3-1-1997 G. 52 %
3-1-1989 e 50 % 3-1-1998 •Go %
3-1-1990 % 3-1-1999 '•Go %
3-1-1991 sa % 3-1-2000 %
3-1-1992 esa % 3-1-2001 a•'7S %
3-1-1993 F•So % 3-1-2002 %
3-1-1994 e•50 % 3-1-2003 G. So %
3-1-1995 %
Our calculation (which is not a part of this bid) of the interest cost from the above is:
Total Interest Cost From April 1, 1986 $ ,3, 7 7/ `/s/2... 7z
Less: Cash Premium $ —o —
Net Interest Cost $ 3 77/ 1572. 7Z
Net Effective Interest Rate . . 9327f %
The Initial Bonds shall be registered in the name of Shearson/Lehman Brothers, Inc .
(syndicate manager). We will advise First City National
Bank of Houston, Houston, Texas, Corporate Trust Division, the paying agent/registrar (The
"Registrar"), of our registration instructions at least five business days prior to the
date set for Initial Delivery. We will not ask the Registrar to accept any registration
instructions after the five day period.
We agree to accept delivery of and make payment for the Bonds in immediately
available funds at the Corporate Trust Office, First City National Bank of Houston,
Houston, Texas, not later than 10:00 A.M., Central Standard Time, on or about April 14,
1986, or thereafter on the date the Bonds are tendered for delivery, pursuant to the terms
set forth in the Notice of Sale and Bidding Instructions.
Cashier's Check No. issued by First City National Bank of Austin
Bank, , Texas, and payable to your order in the amount of $90,000
(is attached hereto) (has been made available to you prior to the opening of this Bid) or
a Good Faith Deposit for disposition in accordance with the terms and conditions set forth
herein and in the Official Notice of Sale. Should we fail or refuse to make payment for
the Bonds in accordance with such terms and conditions, this check shall be cashed and the
Respectfully submitted,
Shearson/Lehman Brothers, Inc.
Bear, Stearns & Co . r� ���
Smith Barney, Harris Upham By
& Co . , Incorporated A rized Repres ive
Bob Bone
ACCEPTANCE CLAUSE
The above and foregoing bid is hereby in all things accepte b the City of Pearland
this 10th day of March 1986.
/
ATTEST:
/e4."4.-""4-4-"° ------ el-X.- / '121
City Secretary, City of Pearland Mayor, City of earland
Return of $90,000 Good Faith Deposit is hereby acknowledged:
BOND YEARS
Dated: April 1, 1986 Due: March 1, Annually
Accumulated
Year Amount Bond Years Bond Years
1987 $ 50,000 45.833 45.833
1988 50,000 95.833 141.667
1989 75,000 218.750 360.417
1990 75,000 293. 750 654.167
1991 100,000 491.667 1,145.833
1992 125,000 739.583 1,885.417
1993 125,000 864.583 2,750.000
1994 150,000 1,187.500 3,937.500
1995 175,000 1,560.417 5,497.917
1996 300,000 2,975.000 8,472.917
1997 425,000 4,639.583 13,112.500
1998 450,000 5,362.500 18,475.000
1999 450,000 5,812.500 24,287.500
2000 475,000 6,610.417 30,897.917
2001 475,000 7,085.417 37,983.333
2002 500,000 7,958.333 45,941.667
2003 500,000 8,458.333 54,400.000
Total Bond Years: 54,400.000
Average Maturity: 12.089 years
CERTIFICATE FOR ORDINANCE
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
We, the undersigned officers of the CITY OF PEARLAND, TEXAS (the
"City") , hereby certify as follows :
1 . The City Council of the City convened in regular meeting on
the 10th day of March, 1986 , at the regular meeting place thereof,
within the City, and the roll was called of the duly constituted offi-
cers and members of the City Council and the City Secretary, to-wit:
Tom Reid Mayor
James E. Bost Mayor Pro Tem
Dennis M. Frauenberger Councilman
Terry Gray Councilman
Alfred E. Lentz Councilman
Richard F. Tetens Councilman
Kay Krouse City Secretary
and all of said persons were present, except the following absentees:
none , thus constituting a quorum.
Whereupon, among other business, the following was transacted at said
meeting: a written
ORDINANCE AUTHORIZING THE ISSUANCE OF $4 ,500 ,000 CITY OF
PEARLAND, TEXAS , PUBLIC IMPROVEMENT BONDS, SERIES 1986 ; AND
DECLARING THAT A SPECIFIC AND IMMEDIATE PUBLIC EMERGENCY EXISTS
IN THAT PROCEEDS OF SALE OF SUCH BONDS ARE REQUIRED AS SOON AS
POSSIBLE TO ACCOMPLISH THE BOND PURPOSES FOR PROTECTION OF
LIFE, HEALTH, PROPERTY AND THE PUBLIC PEACE WITHIN THE CITY
(the "Ordinance" ) was duly introduced for the consideration of the City
Council and read in full. It was then duly moved and seconded that the
Ordinance be adopted; and, after due discussion, said motion, carrying
with it the adoption of the Ordinance, prevailed and carried by the
following vote:
AYES: All members of the City Council shown present above
voted "Aye" .
NAYS : None.
2 . That a true, full and correct copy of the Ordinance adopted
at the meeting described in the above and foregoing paragraph is
attached to and follows this certificate; that the Ordinance has been
duly recorded in the City Council' s minutes of said meeting; that the
above and foregoing paragraph is a true, full and correct excerpt from
the City Council' s minutes of said meeting pertaining to the adoption
of the Ordinance; that the persons named in the above and foregoing
paragraph are the duly chosen, qualified and acting officers and
members of the City Council as indicated therein; that each of the
officers and members of the City Council was duly and sufficiently
notified officially and personally, in advance, of the date, hour,
place and subject of the aforesaid meeting, and that the Ordinance
would be introduced and considered for adoption at said meeting, and
each of said officers and members consented, in advance, to the holding
of such meeting for such purpose; that said meeting was open to the
public as required by law; and that public notice of the date, hour,
place and subject of said meeting was given as required by Vernon' s
Article 6252-17 , as amended.
ORDINANCE NO. 510
ORDINANCE AUTHORIZING THE ISSUANCE OF $4 ,500 ,000
CITY OF PEARLAND, TEXAS, PUBLIC IMPROVEMENT BONDS,
SERIES 1986; AND DECLARING THAT A SPECIFIC AND
IMMEDIATE PUBLIC EMERGENCY EXISTS IN THAT PROCEEDS OF
SALE OF SUCH BONDS ARE REQUIRED AS SOON AS POSSIBLE TO
ACCOMPLISH THE BOND PURPOSES FOR PROTECTION OF LIFE,
HEALTH, PROPERTY AND THE PUBLIC PEACE WITHIN THE CITY
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
WHEREAS , the bonds hereinafter authorized were duly and
favorably voted at an election held in the City on the 15th
day of September, 1984; and
WHEREAS , the City Council of the City has and does
hereby determine that bonds in the amount of $4 , 500 , 000 , as a
portion and the second installment of the $13 , 500 ,000 bonds
voted at said election, should now be issued and delivered in
order to accomplish the purposes for which they were voted,
$5 , 000 , 000 bonds of said voted authorization having been
heretofore issued, sold, and delivered, and the City reserving
the right to issue the remainder of the bonds authorized at
such election at a later time; Now, Therefore
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
PEARLAND, TEXAS:
ARTICLE I
DEFINITIONS AND INTERPRETATIONS
Section 1 . 1 : Definitions. Throughout this ordinance
the following terms and expressions as used herein shall have
the meanings set forth below:
The term "Bond" or "Bonds" shall mean any bond or all
bonds , as the case may be, of the Public Improvement Bonds,
Series 1986 , authorized in this Ordinance, unless the context
clearly indicates otherwise.
The term "City" shall mean the City of Pearland, Texas.
The term "Construction Fund" shall mean the construction
fund established by the City pursuant to Article VI of this
Ordinance.
The term "Interest and Sinking Fund" shall mean the
interest and sinking fund established by the City pursuant to
Section 5 . 1 of this Ordinance.
The term "Interest Payment Date" , when used in connec-
tion with any Bond, shall mean September 1 , 1986 , and each
March 1 and September 1 thereafter until maturity or earlier
redemption of such Bond.
The term "Ordinance" as used herein and in the Bonds
shall mean this ordinance authorizing the Bonds.
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The term "Record Date" shall mean, for any Interest
Payment Date, the 15th calendar date of the month next
preceding such Interest Payment Date.
The term "Register" shall mean the books of registration
kept by the Registrar in which are maintained the names and
addresses of and the principal amounts registered to each
Owner.
The term "Registrar" shall mean the First City National
Bank of Houston, Houston, Texas, and its successors in that
capacity.
Section 1 .2 : Interpretations. All definitions of terms
used herein and all pronouns used in this Ordinance shall be
deemed to apply equally to singular and plural and to all
genders. The titles and headings of the articles and sec-
tions of this Ordinance 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 Ordinance and all the terms and pro-
visions hereof shall be liberally construed to effectuate the
purposes set forth herein.
ARTICLE II
TERMS OF THE BONDS
Section 2 . 1 : Purpose and Amount. The Bonds shall be
issued in fully registered form, without coupons, in the
total authorized aggregate amount of Four Million Five
Hundred Thousand Dollars ($4 , 500 , 000) for the purpose of
providing $500 , 000 FOR THE CONSTRUCTION AND IMPROVEMENT OF
THE ROADS , BRIDGES , AND STREETS OF THE CITY, $2 , 000 , 000 FOR
CONSTRUCTING IMPROVEMENTS AND EXTENSIONS TO THE SANITARY
SEWER SYSTEM OF THE CITY, and $2 , 000 ,000 FOR CONSTRUCTING AND
PERMANENTLY EQUIPPING A NEW CITY HALL BUILDING FOR THE CITY.
Section 2 . 2 : Designation, Date, and Interest. The
Bonds shall be designated as the "CITY OF PEARLAND, TEXAS,
PUBLIC IMPROVEMENT BONDS, SERIES 1986" , and shall be dated
April 1 , 1986 . The Bonds shall bear interest from the later
of April 1 , 1986 , or the most recent Interest Payment Date to
which interest has been paid or duly provided for, calculated
on the basis of a 360 day year of twelve 30 day months, in-
terest payable on September 1 , 1986 , and semiannually there-
after on March 1 and September 1 of each year until maturity
or prior redemption.
Section 2 . 3 : Numbers , Denomination, Interest Rates and
Maturities . The Bonds shall be issued bearing the numbers,
in the principal amounts , and bearing interest at the rates
set forth in the following schedule, and may be transferred
and exchanged as set out in this Ordinance . The Bonds shall
mature , subject to prior redemption in accordance with this
Ordinance, on March 1 in each of the years and in the amounts
set out in such schedule. Bonds delivered in transfer of or
in exchange for other Bonds shall be numbered in order of
their authentication by the Registrar, shall be in the de-
nomination of $5 ,000 or integral multiples thereof, and shall
mature on the same date and bear interest at the same rate as
Bond Principal Interest
Number Year Amount Rate
R- 1 1987 $ 50 ,000 8 .50%
R- 2 1988 50 ,000 8 . 50%
R- 3 1989 75 ,000 8 . 50%
R- 4 1990 75 ,000 8 . 50%
R- 5 1991 100 ,000 8 . 50%
R- 6 1992 125 ,000 8 . 50%
R- 7 1993 125 ,000 8 . 50%
R- 8 1994 150 ,000 8 .50%
R- 9 1995 175 ,000 8 .50%
R-10 1996 300, 000 8 .50%
R-11 1997 425 ,000 6 . 50%
R-12 1998 450 ,000 6 . 60%
R-13 1999 450 , 000 6 . 60%
R-14 2000 475, 000 6 . 70%
R-15 2001 475 ,000 6 .75%
R-16 2002 500 , 000 6 . 80%
R-17 2003 500 ,000 6 .50%
Section 2 . 4 : Execution of Bonds. The Bonds shall be
signed by the Mayor of the City and countersigned by the City
Secretary of the City, by their manual, lithographed, or fac-
simile signatures, and the official seal of the City shall be
impressed or placed in facsimile thereon. Such facsimile
signatures on the Bonds shall have the same effect as if each
of the Bonds had been signed manually and in person by each
of said officers, and such facsimile seal on the Bonds shall
have the same effect as if the official seal of the City had
been manually impressed upon each of the Bonds. If any
officer of the City whose manual or facsimile signature shall
appear on the Bonds shall cease to be such officer before the
authentication of such Bonds or before the delivery of such
Bonds, such manual or facsimile signature shall nevertheless
be valid and sufficient for all purposes as if such officer
had remained in such office.
Section 2 .5 : Authentication. Only such Bonds as shall
bear thereon either (i) the manually executed registration
certificate of the Comptroller of Public Accounts of Texas
substantially in the form provided in Section 4 . 2 of this
Ordinance or (ii) a certificate of authentication, substan-
tially in the form provided in Section 4 . 3 of this Ordinance,
manually executed by an authorized officer of the Registrar,
shall be entitled to the benefits of this Ordinance or shall
be valid or obligatory for any purpose. Such duly executed
certificate of authentication shall be conclusive evidence
that the Bond so authenticated was delivered by the Registrar
hereunder.
Section 2 . 6 : Medium and Place of Payment. The Regis-
trar is hereby appointed as the Paying Agent for the Bonds .
The principal of the Bonds shall be payable, without exchange
or collection charges, in any coin or currency of the United
States of America, which, on the date of payment, is legal
tender for the payment of debts due the United States of
America, upon their presentation and surrender as they become
due and payable, whether at maturity or by prior redemption,
at the principal corporate trust office of the Registrar.
The interest on each Bond shall be payable by check or draft
payable on the Interest Payment Date mailed by the Registrar
Section 2 .7 : Ownership. The City, the Registrar and
any other person may treat the person in whose name any Bond
is registered as the absolute owner of such Bond for the
purpose of making and receiving payment of the principal
thereof and for the further purpose of making and receiving
payment of the interest thereon, and for all other purposes,
whether or not such Bond is overdue, and neither the City nor
the Registrar shall be bound by any notice or knowledge to
the contrary. All payments made to the person deemed to be
the Owner of any Bond in accordance with this Section 2 . 7
shall be valid and effectual and shall discharge the lia-
bility of the City and the Registrar upon such Bond to the
extent of the sums paid.
Section 2 . 8 : Registration, Transfer and Exchange . So
long as any Bonds remain outstanding, the Registrar shall
keep the Register at its principal corporate trust office in
which, subject to such reasonable regulations as it may pre-
scribe, the Registrar shall provide for the registration and
transfer of Bonds in accordance with the terms of this
Ordinance.
Each Bond shall be transferable only upon the presenta-
tion and surrender thereof at the principal corporate trust
office of the Registrar, duly endorsed for transfer, or
accompanied by an assignment duly executed by the registered
Owner or his authorized representative in form satisfactory
to the Registrar. Upon due presentation of any Bond for
transfer, the Registrar shall authenticate and deliver in
exchange therefor, within 72 hours after such presentation, a
new Bond or Bonds, registered in the name of the transferee
or transferees , in authorized denominations and of the same
maturity and aggregate principal amount and bearing interest
at the same rate as the Bond or Bonds so presented.
All Bonds shall be exchangeable upon presentation and
surrender thereof at the principal corporate trust office of
the Registrar for a Bond or Bonds of the same maturity and
interest rate and in any authorized denomination, in an
aggregate principal amount equal to the unpaid principal
amount of the Bond or Bonds presented for exchange. The
Registrar shall be and is hereby authorized to authenticate
and deliver exchange Bonds in accordance with the provisions
of this Section 2 . 8 . Each Bond delivered in accordance with
this Section 2 . 8 shall be entitled to the benefits and
security of this Ordinance to the same extent as the Bond or
Bonds in lieu of which such Bond is delivered.
The City or the Registrar may require the Owner of any
Bond to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with
the transfer or exchange of such Bond. Any fee or charge of
the Registrar for such transfer or exchange shall be paid by
the City.
The Registrar shall not be required to transfer or
exchange any Bond during a period beginning at the opening of
business fifteen (15) calendar days prior to the first
mailing of a notice of redemption of Bonds and ending at the
close of business on the day of such mailing.
Section 2 . 9: Cancellation. All Bonds paid or redeemed
destroyed upon the making of proper records regarding such
payment or redemption. The Registrar shall furnish the City
with appropriate certificates of destruction of such Bonds.
Section 2 . 10 : Replacement Bonds . Upon the presentation
and surrender to the Registrar of a mutilated Bond, the
Registrar shall authenticate and deliver in exchange therefor
a replacement Bond of like maturity, interest rate and prin-
cipal amount, bearing a number not contemporaneously out-
standing. The City or the Registrar may require the Owner of
such Bond to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection there-
with and any other expenses connected therewith, including
the fees and expenses of the Registrar.
If any Bond is lost, apparently destroyed, or wrongfully
taken, the City, pursuant to the applicable laws of the State
of Texas and in the absence of notice or knowledge that such
Bond has been acquired by a bona fide purchaser, shall exe-
cute and the Registrar shall authenticate and deliver a re-
placement Bond of like maturity, interest rate and principal
amount, bearing a number not contemporaneously outstanding,
provided that the Owner thereof shall have:
(a) furnished to the City and the Registrar
satisfactory evidence of the ownership of and the
circumstances of the loss , destruction or theft of such
Bond;
(b) furnished such security or indemnity as may be
required by the Registrar and the City to save them
harmless;
(c) paid all expenses and charges in connection
therewith, including, but not limited to, printing
costs, legal fees , fees of the Registrar and any tax or
other governmental charge that may be imposed; and
(d) met any other reasonable requirements of the
City and the Registrar.
If, after the delivery of such replacement Bond, a bona fide
purchaser of the original Bond in lieu of which such replace-
ment Bond was issued presents for payment such original Bond,
the City and the Registrar shall be entitled to recover such
replacement Bond from the person to whom it was delivered or
any person taking therefrom, except a bona fide purchaser,
and shall be entitled to recover upon the security or indem-
nity provided therefor to the extent of any loss , damage,
cost or expense incurred by the City or the Registrar in
connection therewith.
If any such mutilated, lost, apparently destroyed or
wrongfully taken Bond has become or is about to become due
and payable, the City in its discretion may, instead of
issuing a replacement Bond, authorize the Registrar to pay
such Bond.
Each replacement Bond delivered in accordance with this
Section 2 . 10 shall be entitled to the benefits and security
of this Ordinance to the same extent as the Bond or Bonds in
ARTICLE III
OPTION OF PRIOR REDEMPTION
Section 3 . 1 : Optional Redemption. The City reserves
the right, at its option, to redeem prior to maturity the
Bonds maturing on or after March 1 , 1998 , in whole or from
time to time in part, on March 1 , 1997 , or on any Interest
Payment Date thereafter at par plus accrued interest on the
Bonds called for redemption to the date fixed for redemption.
If less than all of the Bonds are redeemed within a stated
maturity at any time, the Bonds to be redeemed shall be
selected by the City.
Section 3 . 2 : Partial Redemption. Principal amounts may
be redeemed only in integral multiples of $5, 000 . If a Bond
subject to redemption is in a denomination larger than
$5 ,000 , a portion of such Bond may be redeemed, but only in
integral multiples of $5 ,000 . Upon surrender of any Bond for
redemption in part, the Registrar, in accordance with Section
2 . 8 hereof, shall authenticate and deliver in exchange there-
for a Bond or Bonds of like maturity and interest rate in an
aggregate principal amount equal to the unredeemed portion of
the Bond so surrendered.
Section 3 .3 : Notice of Redemption. Notice of any
redemption identifying the Bonds to be redeemed in whole or
in part shall be given by the Registrar at least thirty days
prior to the date fixed for redemption by (i) sending written
notice by certified mail to the Owner of each Bond to be
redeemed in whole or in part at the address shown on the
Register and (ii) publication one time in a financial journal
or publication published in the City of New York, New York,
or in the City of Austin, Texas. Such notices shall state
the redemption date, the amount of accrued interest payable
on the redemption date, the place at which Bonds are to be
surrendered for payment and, if less than all Bonds out-
standing are to be redeemed, the numbers of the Bonds or
portions thereof to be redeemed. Any notice given as pro-
vided in this Section 3 . 3 shall be conclusively presumed to
have been duly given, whether or not the Owner receives such
notice. By the date fixed for redemption, due provision
shall be made with the Registrar for payment of the redemp-
tion price of the Bonds or portions thereof to be redeemed,
plus accrued interest to the date fixed for redemption. When
Bonds have been called for redemption in whole or in part and
due provision has been made to redeem same as herein provided,
the Bonds or portions thereof so redeemed shall no longer be
regarded as outstanding except for the purpose of receiving
payment solely from the funds so provided for redemption, and
the rights of the Owners to collect interest which would
otherwise accrue after the redemption date on any Bond or
portion thereof called for redemption shall terminate on the
date fixed for redemption.
ARTICLE IV
FORM OF BONDS AND CERTIFICATES
Section 4 . 1 : Form of Bonds. The Bonds shall be in sub-
stantially the following form, with such additions, deletions
and variations as may be necessary or desirable and permitted
mm—
(Face of Bond)
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTIES OF BRAZORIA AND HARRIS
NUMBER DENOMINATION
R- $
REGISTERED REGISTERED
CITY OF PEARLAND, TEXAS
PUBLIC IMPROVEMENT BOND, SERIES 1986
INTEREST RATE: MATURITY DATE: ISSUE DATE: CUSIP NO.
APRIL 1 , 1986
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
THE CITY OF PEARLAND, TEXAS (the "City" ) promises to pay
to the Registered Owner identified above, or registered
assigns, on the date specified above, upon presentation and
surrender of this bond at the principal corporate trust
office of the FIRST CITY NATIONAL BANK OF HOUSTON, HOUSTON,
TEXAS (the "Registrar") , the principal amount identified
above, payable in any coin or currency of the United States
of America which on the date of payment of such principal is
legal tender for the payment of debts due the United States
of America, and to pay interest thereon at the rate shown
above, calculated on the basis of a 360 day year of twelve
30 day months, from the later of April 1 , 1986 , or the most
recent interest payment date to which interest has been paid
or duly provided for. Interest on this bond is payable by
check or draft payable on September 1 , 1986 and semiannually
thereafter on each March 1 and September 1 , mailed to the
registered owner as shown on the books of registration kept
by the Registrar as of the 15th calendar date of the month
next preceding each interest payment date.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF
THIS BOND SET FORTH ON THE REVERSE HEREOF, WHICH PROVISIONS
SHALL HAVE THE SAME FORCE AND EFFECT AS IF SET FORTH AT THIS
PLACE.
IN WITNESS WHEREOF, this bond has been signed with the
manual or facsimile signature of the Mayor of the City and
countersigned with the manual or facsimile signature of the
City Secretary of the City, and the official seal of the City
has been duly impressed, or placed in facsimile, on this
bond.
(AUTHENTICATION CERTIFICATE) (SEAL) CITY OF PEARLAND, TEXAS
Mayor
City Secretary
(Back Panel of Bond)
THE ROADS , BRIDGES, AND STREETS OF THE CITY, $2 , 000 , 000 FOR
CONSTRUCTING IMPROVEMENTS AND EXTENSIONS TO THE SANITARY
SEWER SYSTEM OF THE CITY, and $2 ,000 ,000 FOR CONSTRUCTING AND
PERMANENTLY EQUIPPING A NEW CITY HALL BUILDING FOR THE CITY,
and pursuant to an ordinance adopted by the City Council on
March 10 , 1986 (the "Ordinance" ) .
THE CITY RESERVES THE RIGHT, at its option, to redeem
the Bonds maturing on or after March 1 , 1998 , prior to their
scheduled maturities, in whole or from time to time in part,
in integral multiples of $5 ,000 , on March 1 , 1997 , or on any
interest payment date thereafter at par plus accrued interest
on the principal amounts called for redemption to the date
fixed for redemption. Reference is made to the Ordinance for
complete details concerning the manner of redeeming the
Bonds.
NOTICE OF ANY REDEMPTION shall be given at least thirty
(30) days prior to the date fixed for redemption by certified
mail, addressed to the registered owners of each Bond to be
redeemed in whole or in part at the address shown on the
books of registration kept by the Registrar and by publica-
tion once in a financial journal or publication published in
the City of New York, New York, or in the City of Austin,
Texas . When Bonds or portions thereof have been called for
redemption, and due provision has been made to redeem the
same, the principal amounts so redeemed shall be payable
solely from the funds provided for redemption, and interest
which would otherwise accrue on the amounts called for
redemption shall terminate on the date fixed for redemption.
THIS BOND IS TRANSFERABLE only upon presentation and
surrender at the principal corporate trust office of the
Registrar, duly endorsed for transfer or accompanied by an
assignment duly executed by the registered owner or his
authorized representative, subject to the terms and condi-
tions of the Ordinance.
THE BONDS ARE EXCHANGEABLE at the principal corporate
trust office of the Registrar for bonds in the principal
amount of $5 , 000 or any integral multiple thereof, subject to
the terms and conditions of the Ordinance.
THE REGISTRAR SHALL NOT BE REQUIRED to transfer or
exchange any Bond during a period beginning at the opening of
business fifteen (15) calendar days prior to the first
mailing of a notice of redemption of Bonds and ending at the
close of business on the day of such mailing.
THIS BOND SHALL NOT BE valid or obligatory for any pur-
pose or be entitled to any benefit under the Ordinance unless
this Bond either (i) is registered by the Comptroller of
Public Accounts of the State of Texas by registration cer-
tificate endorsed hereon or (ii) is authenticated by the
Registrar by due execution of the authentication certificate
endorsed hereon.
IT IS HEREBY CERTIFIED, RECITED AND COVENANTED that this
Bond has been duly and validly issued and delivered; that all
acts, conditions and things required or proper to be per-
formed, to exist and to be done precedent to or in the issu-
ance and delivery of this Bond have been performed, exist and
comes due and such principal matures , have been levied and
ordered to be levied against all taxable property in the City
within the limits prescribed by the Constitution and laws of
the State of Texas, and have been pledged irrevocably for
such payment.
Section 4 . 2 : Registration of Bonds by State Comptroller.
Bonds No. R-1 through R-17 shall be registered by the Comp-
troller of Public Accounts of the State of Texas, as provided
by law. The registration certificate of the Comptroller of
Public Accounts shall be printed on Bonds R-1 through R-17
and shall be in substantially the following form:
COMPTROLLER' S REGISTRATION CERTIFICATE: REGISTER NO.
I HEREBY CERTIFY that this bond has been examined, cer-
tified as to validity, and approved by the Attorney General
of the State of Texas, and that this bond has been registered
by the Comptroller of Public Accounts of the State of Texas.
WITNESS MY SIGNATURE AND SEAL this
xxxxxxxxxx
Comptroller of Public Accounts
(SEAL) of the State of Texas
Section 4 .3 : Form of Authentication Certificate. The
following form of authentication certificate shall be printed
on the face of each of the Bonds:
Registration Date:
AUTHENTICATION CERTIFICATE
This bond is one of the bonds
described in and delivered
pursuant to the within-mentioned
Ordinance.
FIRST CITY NATIONAL BANK OF HOUSTON
Houston, Texas
By
Authorized Officer
Section 4 .4 : Form of Assignment. The following form of
assignment shall be printed on the back of each of the Bonds:
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells,
assigns, and transfers unto (print or typewrite name , address,
and zip code of transferee) :
(Social Security or other identifying
number: ) the within bond and all rights
thereunder, and hereby irrevocably constitutes and appoints
attorney
to transfer said bond on the books kept for registration
thereof, with full power of substitution in the premises .
DATED:
Section 4 .5 : Opinion and CUSIP Numbers. The approving
opinion of Vinson & Elkins, Houston, Texas, and CUSIP Numbers
may be printed on the Bonds, but errors or omissions in the
printing of such opinion or such numbers shall have no effect
on the validity of the Bonds.
ARTICLE V
SECURITY AND SOURCE OF PAYMENT FOR BONDS
Section 5 . 1 : Interest and Sinking Fund. The proceeds
from all taxes levied, assessed and collected for and on
account of the Bonds authorized by this Ordinance shall be
deposited, as collected, in a special fund to be designated
"City of Pearland, Texas, Public Improvement Bonds, Series
1986 , Interest and Sinking Fund" . While said Bonds or any
part of the principal thereof or interest thereon remain
outstanding and unpaid, there is hereby levied and there
shall be annually levied, assessed and collected in due time,
form and manner, and at the same time other City taxes are
levied, assessed and collected, in each year, beginning with
the current year, a continuing direct annual ad valorem tax
upon all taxable property in said City sufficient to pay the
current interest on said Bonds as the same becomes due, and
to provide and maintain a sinking fund adequate to pay the
principal of the Bonds as such principal matures but never
less than two per cent (2%) of the original principal amount
of the Bonds each year, full allowance being made for delin-
quencies and costs of collection, and said taxes when col-
lected shall be applied to the payment of the interest on and
principal of said Bonds and to no other purpose. In addi-
tion, interest accrued from the date of the Bonds until their
delivery, and premium if any, is to be deposited in such
fund.
Section 5 . 2 : Investment of Interest and Sinking Fund.
Money in the Interest and Sinking Fund may, at the option of
the City, be invested in time deposits or certificates of
deposit secured in the manner required by law for public
funds, or be invested in direct obligations of, or obliga-
tions the principal of and interest on which are uncondition-
ally guaranteed by, the United States of America, in obliga-
tions of any agencies or instrumentalities of the United
States of America or as otherwise permitted by state law;
provided that all such deposits and investments shall be made
in such manner (which may include repurchase agreements for
such investments with any national bank) that money required
to be expended from the Interest and Sinking Fund will be
available at the proper time or times. All such investments
shall be valued in terms of current market value no less
frequently than the last business day of the City' s Fiscal
Year, except that any direct obligations of the United States
of America - State and Local Government Series shall be con-
tinuously valued at their par value or principal face amount.
Any obligation in which money is so invested shall be kept
and held in an official depository of the City, except as
hereinafter provided. For purposes of maximizing investment
returns, money in such Interest and Sinking Fund may be in-
vested, together with money in the Construction Fund or with
other money of the City, in common investments of the kind
described above, or in a common pool of such investments
which shall be kept and held at an official depository of the
the investment or investment pool in which such money is
invested and the share thereof purchased with such money or
owned by such Fund are held by or on behalf of each such `.„
Fund. If necessary, such investments shall be promptly sold
to prevent any default. All interest and income derived from
such deposits and investments of the Interest and Sinking
Fund shall be credited to the Interest and Sinking Fund. So
long as any Bonds remain outstanding, all uninvested moneys
on deposit in, or credited to, the Interest and Sinking Fund
shall be secured by the pledge of security, as provided by
law for cities in the State of Texas.
ARTICLE VI
CONSTRUCTION FUND
Section 6 . 1 : Construction Fund. There is hereby
created and established a special fund of the City, to be
known as the "City of Pearland, Texas, Public Improvement
Bonds, Series 1986 , Construction Fund" , which shall be
maintained as a separate account on the books of the City.
Money on deposit in the Construction Fund shall be used only
for the purposes set forth in Section 2 . 1 of this Ordinance,
except that interest and income derived from deposit and
investment of moneys in the Construction Fund may be utilized
as provided below in Section 6 . 2 hereof.
Section 6 . 2 : Investment of Money in Construction Fund.
Money on deposit in the Construction Fund may, at the option
of the City, be invested as permitted by Texas law; provided
that all such deposits and investments shall be made in such
manner (which may include repurchase agreements for such
investments with any national bank) that the money required
to be expended from the Construction Fund will be available
at the proper time or times. All such investments shall be
valued in terms of current market value no less frequently
than the last business day of the City' s Fiscal Year, except
that any direct obligations of the United States of America
-- State and Local Government Series shall be continuously
valued at their par value or principal face amount. Any
obligation in which money is so invested shall be kept and
held in an official depository of the City, except as herein-
after provided. For purposes of maximizing investment re-
turns, money in the Construction Fund may be invested,
together with money in the Interest and Sinking Fund or with
other money of the City, in common investments of the kind
described above, or in a common pool of such investments
which shall be kept and held at an official depository of the
City, which shall not be deemed to be or constitute a com-
mingling of such money or Funds provided that safekeeping
receipts or certificates of participation clearly evidencing
the investment or investment pool in which such money is
invested and the share thereof purchased with such money or
owned by the Construction Fund are held by or on behalf of
the Construction Fund. All interest and income derived from
such deposits and investments shall remain in the Construc-
tion Fund, except that (a) to the extent required by law,
such interest and income may be applied to make such payments
to the United States of America as shall be required to
assure that interest on the Bonds is exempt from federal
income taxation, and (b) in the discretion of the City, such
ARTICLE VII
PROVISIONS CONCERNING SALE AND
DISPOSITION OF PROCEEDS OF BONDS
Section 7 . 1 : Sale of Bonds. The sale of the Bonds to
SHEARSON/LEHMAN BROTHERS , INC. , and Associates
(herein referred to as the "Purchaser") at the price of par
and accrued interest thereon to date of delivery, plus a cash
premium of $ -0- , is hereby authorized, approved, ratified
and confirmed, subject to the unqualified approving opinion
as to the legality of the Bonds of the Attorney General of
the State of Texas, and of Vinson & Elkins, Houston, Texas,
bond counsel.
Section 7 .2 : Approval, Registration and Delivery.
After the Bonds to be initially issued shall have been exe-
cuted, it shall be the duty of the Mayor of the City to
deliver the Bonds to be initially issued and all pertinent
records and proceedings to the Attorney General of Texas, for
examination and approval by the Attorney General. After the
Bonds to be initially issued shall have been approved by the
Attorney General, they shall be delivered to the Comptroller
of Public Accounts of the State of Texas for registration.
Upon registration of the Bonds to be initially issued, the
Comptroller of Public Accounts (or a deputy lawfully desig-
nated in writing to act for the Comptroller) shall manually
sign the Comptroller' s Registration Certificate prescribed
herein to be printed and endorsed on the Bonds to be ini-
tially issued, and the seal of said Comptroller shall be
impressed, or placed in facsimile, thereon.
Section 7 .3 : No Arbitrage. The City specifically
covenants that, unless it receives an opinion of nationally
recognized bond counsel to the effect that failure to do so
will not cause interest on the Bonds to become subject to
federal income taxation, the City will comply with the
provisions of H.R. 3838 , adopted by the House of Representa-
tives of the Congress of the United States of America on
December 17 , 1985, including, without limitation, compliance
with the provisions of H.R. 3838 regarding the timing of the
expenditure of the proceeds of the Bonds, the use of such
proceeds and the facilities financed with such proceeds, the
restriction of investment yields, the filing of information
with the Internal Revenue Service, and the rebate of arbitrage
profit to the United States. Further, the City certifies
that based upon all facts and estimates now known or reason-
ably expected to be in existence on the date the Bonds
initially issued are delivered and paid for, the City reason-
ably expects that the proceeds of the Bonds will not be used
in a manner that would cause the Bonds or any portion of the
Bonds to be an "arbitrage bond" under Section 103 (c) (2) of
the Internal Revenue Code of 1954 , as amended, and the regu-
lations prescribed thereunder. Furthermore, all officers,
employees and agents of the City are authorized and directed
to provide certifications of facts and estimates that are
material to the reasonable expectations of the City as of the
date the Bonds initially issued are delivered and paid for.
In particular, all or any officers of the City are authorized
to certify for the City the facts and circumstances and
reasonable expectations of the City on the date the Bonds
initially issued are delivered and paid for regarding the
rarara —
take such other and further actions as may be required so
that the Bonds shall not be "arbitrage bonds" under Section
103 (c) (2) of the Internal Revenue Code of 1954 , as amended,
and the regulations prescribed from time to time thereunder.
ARTICLE VIII
MISCELLANEOUS
Section 8 . 1 : Official Statement. The City ratifies and
confirms its prior approval of the form and content of the
Official Statement prepared for initial offering and sale of
the Bonds and hereby approves the form and content of any
addenda, supplement, or amendment thereto. The use of such
Official Statement in the reoffering of the Bonds by the
Purchaser is hereby approved and authorized. The proper
officials of the City are hereby authorized to execute and
deliver a certificate pertaining to such Official Statement
as prescribed therein, dated as of the date of payment for
and delivery of the Bonds.
Section 8 . 2 : Provisions Concerning Registrar. (a) The
Registrar, by undertaking the performance of the duties of
the Registrar and in consideration of the payment of fees
and/or deposits of money pursuant to this Ordinance and a
Paying Agent/Registrar Agreement, accepts and agrees to abide
by the terms of this Ordinance and such Agreement. The City
hereby approves the Paying Agent/Registrar Agreement.
(b) The City reserves the right to replace the Regis-
trar or its successor at any time. If the Registrar is
replaced by the City, the new Registrar shall accept the
previous Registrar ' s records and act in the same capacity as
the previous Registrar. Any successor Registrar shall be
either a national or state banking institution and a corpora-
tion organized and doing business under the laws of the
United States of America or any State authorized under such
laws to exercise trust powers and subject to supervision or
examination by Federal or State authority.
Section 8 . 3 : Further Procedures . The Mayor, and the
City Secretary and other appropriate officials of the City
are hereby authorized and directed to do any and all things
necessary and/or convenient to carry out the terms and
purposes of this Ordinance .
Section 8 . 4 : Severability. If any Section, paragraph,
clause or provision of this Ordinance shall for any reason be
held to be invalid or unenforceable , the invalidity or unen-
forceability of such Section, paragraph, clause or provision
shall not affect any of the remaining provisions of this
Ordinance.
Section 8 .5 : Declaration of Emergency; Open Meeting.
It is hereby officially found and determined that this
Ordinance relates to an immediate public emergency affecting
life, health, property and the public peace, and that such
emergency and urgent public necessity exist, the specific
emergency being that the proceeds from the sale of the Bonds
are required as soon as possible so that the City may proceed
without unnecessary delay to accomplish the purposes for
which the Bonds were voted in order to further protect life,
mmm
Ordinance is adopted at the time and place held; the meeting
at which this Ordinance was adopted was open to the public,
and public notice of the time, place and purpose of said
meeting was given, all as required by Vernon' s Ann. Tex. Civ.
St. Article 6252-17 , as amended; and that such notice as
given is hereby authorized, approved, adopted and ratified.
Section 8 . 6 : Effect of Ordinance. This Ordinance shall
be in force and effect from and after its passage, and it is
so ordered.
Section 8 . 7 : Repealer. All orders, resolutions and
ordinances, or parts thereof, inconsistent herewith are
hereby repealed to the extent of such inconsistency.
PASSED AND APPROVED this 10th day of March, 1986 .
/s/ Tom Reid
Mayor
CITY OF PEARLAND, TEXAS
ATTEST:
/s/ Kay Krouse
City Secretary
CITY OF PEARLAND, TEXAS
(SEAL)
APPROPRIATION CERTIFICATE
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
WE, the undersigned, Mayor and City Secretary, respec-
tively, of the CITY OF PEARLAND, TEXAS (the "City") , do
hereby make and execute this certificate for the benefit of
the Attorney General of the State of Texas and all other
persons interested in the City' s $4 ,500 ,000 PUBLIC IMPROVE-
MENT BONDS, SERIES 1986 , dated April 1 , 1986 (the "Bonds" ) ,
now in the process of issuance.
WE hereby certify that there has been appropriated from
funds of the City on hand and lawfully available for such
purpose an amount of money sufficient to pay the interest
which will be due on the Bonds on September 1 , 1986 , and such
funds shall be used for no other purpose.
WITNESS our hands and the official seal of the City,
this 7 day of April, 1986 .
4-1
Mayor
CITY OF PEARLAND, TEXAS
ATTEST:
0617 7�/Zeu4--e
Cityecretary
CITY OF PEARLAND, TEXAS
(SEAL)
CERTIFICATE OF ASSESSED VALUATION
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
I , the undersigned, the duly appointed, qualified, and
acting Tax Assessor-Collector of the CITY OF PEARLAND of
Brazoria and Harris Counties , Texas (the "City") , do hereby
certify that the following is a true and correct statement
of the assessed valuation of taxable property in the City as
shown by the duly approved tax rolls for the year 1985 ,
which are the last approved tax rolls for the City on file
in my office, to-wit:
$591 , 810 , 120
WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this
/Qf4 day of March, 1986 .
n 7
Tax Assessor oll ctor
CITY OF PEARLAND, TEXAS
(SEAL)
SIGNATURE IDENTIFICATION AND
NO-LITIGATION CERTIFICATE
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
We, the undersigned officers of the City of Pearland, Texas,
certify that we officially signed, by our facsimile signatures, on
behalf of said City, the following described bonds, hereinafter called
the "Bonds" , to-wit:
CITY OF PEARLAND, TEXAS , PUBLIC IMPROVEMENT BONDS,
SERIES 1986 , dated April 1 , 1986 , aggregating
$4 , 500 ,000 , and maturing on March 1 in each of the years
1987 through 2003 , both inclusive,
being on the date of such signing and on the date hereof the duly
chosen, qualified and acting officers authorized to execute the Bonds,
and holding the official titles set forth below opposite such signa-
tures. We further certify that said facsimile signatures have been
affixed to the Bonds with our full knowledge and consent, and we
hereby respectively adopt the same as our own signatures .
We further certify that, to our knowledge, no litigation of any
nature is now pending or threatened, either in the State or Federal
courts contesting or attacking the Bonds or restraining or enjoining
their issuance, execution or delivery, or restraining or enjoining the
levy and/or collection and/or pledge of the funds from which the Bonds
are payable, or in any manner questioning the authority or proceedings
for the issuance, execution or delivery of the Bonds, or affecting the
title of the present officials, and that no proceedings or authority
for the issuance, execution or delivery of the Bonds have been re-
pealed, rescinded or revoked.
We further certify that the seal which has been impressed, or
placed in facsimile, upon the Bonds is the legally adopted, proper and
only official seal of the issuer of the Bonds, said official seal
being impressed on this certificate.
We further certify that no petition or other request has been
filed with or presented to any official of the issuer of the Bonds
requesting that any of the proceedings authorizing the Bonds be sub-
mitted to a referendum or other election.
We further certify that the information and data contained in the
General Certificate dated March 10 , 1986 , are still true and correct
as of this date.
WITNESS OUR HANDS AND SAID SEAL, this /Q,'t day of ,
1986 .
r'
SIG ATURES TITLE OF OFFICE
Mayor
Tom Reid
City Secretary
Kay Kr use
(SEAL)
The signatures of the above officers re hereby certified to be
genuine.
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land State Bank Si n t re of Bank Officer
Name of Bank Cashier
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OFFICE OF COMPTROLLER I
OF THE STATE OF TEXAS
I, Bob Bullock, Comptroller of Public Accounts of the State of Texas, do hereby
certify that the attachment is a true and correct copy of the opinion of the Attorney
General approving the City of Pearl and, Texas, Public Improvement Bonds,
Series 1986
numbered consecutively from R-1 to R-1 7 of the denomination of
as authorized
S Various each, dated April 1 19 86 , due by issuer
interest Various percent, under and by authority of which said bonds were registered
in this office, on the 11 th day of April 19 86 , as the same appears of
record on page 375 Bond Register of the Comptroller's Office, Vol. 87
Register Number 49295
Given under my hand and seal of office, at Austin, Texas, the 11 th
day of April , 19 86.
atN• (c
BOB BULLOCK
Comptroller of Public Accounts
State of Texas
(73-116
Rev. 5-82)
STATE OF TEXAS §
COUNTY OF HARRIS §
I, S. Whitten Rusk, in my offical capacity, hereby certify, That I am an
officer, namely, Assistant Cashier of FIRST CITY NATIONAL BANK OF HOUSTON,
(Houston, Texas) a National bank; that at a meeting of the Board of Directors
of this bank, duly and regularly convened and held on the 21st day of March
1985, at which a quorum for the transaction of business was present and acting
throughout, the following resolution was duly and regularly adopted, and is
still in full force and effect, and appears as follows in the Minutes of said
meeting:
"BE IT RESOLVED, That the Chairman of the Board, President and all Execu-
tive Vice Presidents, Senior Vice Presidents, Senior Vice Presidents and Trust
Officers, Vice Presidents, Vice Presidents and Trust Officers, Vice Presidents
and Trust Investment Officers, Assistant Vice Presidents, Trust Officers,
Assistant Trust Officers, Trust Investment Officers, Assistant Trust Investment
Officer, Trust Development Officers, Pension Trust Officers, Trust Real Estate
Officers, Trust Operations Officers, Trust Petroleum Officers, Corporate Trust
Officers, Personal Trust Officers, Trust Administrative Officer and Trust
Safekeeping Officers of FIRST CITY NATIONAL BANK OF HOUSTON (hereinafter called
'this bank') , and any one of them acting without another, shall be and hereby
are fully authorized, to represent and act for this bank in all matters related
to the designation, appointment, qualifying, and acting of this all matters
related to the designation appointment, qualifying, and acting of this bank
(whether as sole or co-fiduciary) as Trustee, Successor Trustee, Substitute
Trustee, Receiver, Executor, Administrator, Temporary Administrator, Guardian,
Temporary Guardian, Agent, Escrow Agent, Custodian, Registrar, Transfer Agent,
Dividend or Guardian, Agent, Escrow Agent, Custodian, Registrar, Transfer
Agent, Dividend or Interest Disbursing Agent, and/or in any fiduciary capacity,
be it under any deed of trust, will, court order, proceeding, and/or any other
instrument or transaction, and in the performance of its duties in any or all
such capacities; and without in anywise limiting any of the general provisions
hereof that any of said officers be and are fully authorized for this bank to:
(a) Execute and deliver petitions, applications, oaths, bonds, reports,
certificates, and all other instruments and perform all acts desired,
required, or deemed advisable in connection with the appointment,
qualifying, and acting in any such capacity and the performance of
duties and exercise of rights in any of such capacities or under and
in connection with any of such capacities or under and in connection
with any such orders, proceedings and instruments;
(b) Handle, manage, operate, control, exchange, mortgage, pledge, sell,
and/or dispose of any or all interests, properties, assets, claims,
and things of value at any time involved in or connected with any of
said appointments, designations, orders, proceedings, instruments,
and/or matters connected therewith to the extent and as may be
permitted or authorized by governing laws, statutes, or under any
orders, proceedings, instruments, or transactions;
(c) Received, receipt for, handle, and disburse funds, monies, and
properties which might be realized, payable, or result fran any
matters and transactions herein mentioned; and
(d) Post and give notices (including notices of sale) ; conduct and
conclude foreclosures and sales; execute, forward, files and deliver
all such deeds, assignments, and instruments; exercise and enforce
all rights and powers; and perform or cause to be performed all such
acts and duties at any time permitted, necessary, required, desired,
requested, or deemed advisable in connection with or in anywise
related to all or all of the matters hereinbefore mentioned, or the
acting by this bank or the performance and discharge of its duties as
or any of the capacities hereinbefore mentioned."
I further certify that the foregoing resolutions are not contrary to any
provisions in the charter or bylaws of this bank; that I am authorized to make
this certificate on behalf of FIRST CITY NATIONAL BANK OF HOUSTON; and that the
title(s) and signature(s) appearing opposite the name(s) of the officer(s)
below are the authentic title(s) and signature(s) respectively of such
officer(s) :
NAME TITLE SIGNATURE
Margaret P. Mata Assistant Vice President and '
Trust Officer
Josie L. Hixon Assistant Cashier .� / X Yb —J
IN WITNESS WHEREOF, I hereunt set hand and affix the corporate seal of
this bank of this /JL day of A.D. 1986.
44-‘14/-
.Assistant Kshier
(SEAL)
PAYING AGENT/REGISTRAR AGREEMENT
THIS AGREEMENT (this "Agreement" ) , is entered into as of
March 10 , 1986 , by and between the City of Pearland, Texas
(the "Issuer") , and the First City National Bank of Houston,
Houston, Texas, a national bank duly organized and existing
under the laws of the United States of America (the "Bank" ) .
RECITALS OF THE ISSUER
The Issuer has duly authorized and provided for the
issuance of its bonds, entitled "City of Pearland, Texas,
Public Improvement Bonds , Series 1986" (the "Bonds" ) in an
aggregate principal amount of $4 ,500 ,000 to be issued as
fully registered bonds without coupons;
All things necessary to make the Bonds the valid obliga-
tions of the Issuer, in accordance with their terms, will be
done upon the issuance and delivery thereof;
The Issuer and the Bank wish to provide the terms under
which the Bank will act as Paying Agent to pay the principal
and interest on the Bonds, in accordance with the terms
thereof, and under which the Bank will act as Registrar for
the Bonds;
The Issuer and the Bank have duly authorized the execu-
tion and delivery of this Agreement; and all things necessary
to make this Agreement the valid agreement of the parties , in
accordance with its terms, have been done.
NOW, THEREFORE, it is mutually agreed as follows:
ARTICLE ONE
APPOINTMENT OF BANK AS
PAYING AGENT AND REGISTRAR
Section 1 .01 . Appointment.
The Issuer hereby appoints the Bank to act as Paying
Agent with respect to the Bonds, to pay to the Registered
Owners of the Bonds in accordance with the terms and provi-
sions of this Agreement and the Bond Ordinance, the principal
of and interest on all or any of the Bonds.
The Issuer hereby appoints the Bank as Registrar with
respect to the Bonds .
The Bank hereby accepts its appointment, and agrees to
act as Paying Agent and Registrar.
Section 1 . 02 . Compensation.
As compensation for the Bank' s services as Paying Agent
and Registrar, the Issuer hereby agrees to pay the Bank the
ARTICLE TWO
DEFINITIONS
Section 2 . 01 . Definitions.
For all purposes of this Agreement, except as otherwise
expressly provided or unless the context otherwise requires :
"Bank" means the First City National Bank of Houston,
Houston, Texas, a national bank duly organized and existing
under the laws of the United States of America.
"Bank Office" means the principal corporate trust
office of the Bank as indicated on the signature page of the
Bank hereon. The Bank will notify the Issuer in writing of
any change in location of the Bank Office.
"Bond Register" means the book or books of registration
kept by the Bank in which are maintained the names and
addresses and principal amounts registered to each Registered
Owner.
"Bond Ordinance" means the ordinance of the Issuer
approved March 10 , 1986 , pursuant to which the Bonds are
issued.
"Bond" or "Bonds" means any one or all of the
"$4 ,500 , 000 City of Pearland, Texas , Public Improvement
Bonds, Series 1986" .
"Issuer" means the City of Pearland, Texas.
"Issuer Request" means a written request or order signed
in the name of the Issuer by the Mayor and City Secretary of
the Issuer and delivered to the Bank.
"Paying Agent" means the Bank when it is performing the
function of paying agent.
"Person" means any individual, corporation, partnership,
joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or
political subdivision of a government or any entity whatso-
ever.
"Redemption Date" when used with respect to any Bond to
be redeemed means the date fixed for such redemption pursuant
to the terms of the Bond Ordinance.
"Registered Owner" means a Person in whose name a Bond
is registered in the Bond Register.
"Registrar" means the Bank when it is performing the
function of registrar.
"Stated Maturity" when used with respect to any Bond
means the date specified in the Bond Ordinance as the date on
ARTICLE THREE
PAYING AGENT
Section 3 . 01 . Duties of Paying Agent.
As Paying Agent, the Bank shall, provided adequate funds
have been provided to it for such purpose by or on behalf of
the Issuer, pay on behalf of the Issuer the principal of and
interest on each Bond at its Stated Maturity or Redemption
Date, to the Registered Owner in accordance with the provi-
sions of the Bond Ordinance.
Section 3 .02 . Payment Date.
The Issuer hereby instructs the Bank to pay the princi-
pal of and interest on the Bonds on the dates specified in
the Bond Ordinance.
ARTICLE FOUR
REGISTRAR
Section 4 . 01 . Initial Delivery of Bonds.
The Bonds will be initially registered and delivered to
the purchaser designated by the Issuer in the Bond Ordinance
as one Bond for each maturity. If such purchaser delivers a
written request to the Bank not later than five business days
prior to the date of initial delivery, the Bank will, on the
date of initial delivery, exchange the Bonds initially
delivered for Bonds of authorized denominations, registered
in accordance with the instructions in such request, and
maturing on the same Stated Maturity dates as and bearing
interest at the rates borne by the Bonds initially delivered.
Section 4 .02 . Duties of Registrar.
The Bank shall provide for the proper registration of
transfer, exchange and replacement of the Bonds , in accor-
dance with the provisions of the Bond Ordinance.
Section 4 . 03 . Unauthenticated Bonds .
The Issuer shall provide an adequate inventory of
unauthenticated Bonds to facilitate transfers. The Bank
covenants that it will maintain such unauthenticated bonds in
safekeeping and will use reasonable care in maintaining such
Bonds in safekeeping, which shall be not less than the care
it maintains for debt securities of other government entities
or corporations for which it serves as registrar, or which it
maintains for its own bonds.
Section 4 . 04 . Form of Bond Register.
The Bank as Registrar will maintain the records of the
Bond Register in accordance with the Bank' s general practices
and procedures in effect from time to time.
Section 4 . 05 . Reports.
The Bank will provide the Issuer reports not less often
• --- --.� ��„ oo months. which reports will describe in
and the Bond Register. The Issuer may also inspect and make
copies of the information in the Bond Register at any time
the Bank is customarily open for business, provided that
reasonable time is allowed the Bank to provide an up-to-date
listing or to convert the information into written form.
The Bank will not release or disclose the content of the
Bond Register to any person other than to, or at the written
request of, an authorized officer or employee of the Issuer,
except upon receipt of a subpoena or court order. Upon
receipt of a subpoena or court order the Bank will notify the
Issuer immediately so that the Issuer may contest the sub-
poena or court order.
Section 4 .06 . Cancelled Bonds.
All Bonds surrendered for payment, redemption, transfer,
exchange, or replacement, if surrendered to the Bank, shall
be promptly cancelled by it and, if surrendered to the
Issuer, shall be delivered to the Bank and, if not already
cancelled, shall be promptly cancelled by the Bank. The
Issuer may at any time deliver to the Bank for cancellation
any Bonds previously authenticated and delivered which the
Issuer may have acquired in any manner whatsoever, and all
Bonds so delivered shall be promptly cancelled by the Bank.
All cancelled Bonds held by the Bank shall be destroyed and
evidence of such destruction furnished to the Issuer.
ARTICLE FIVE
THE BANK
Section 5 . 01 . Duties of Bank.
The Bank undertakes to perform the duties set forth
herein and in accordance with the Bond Ordinance and agrees
to use reasonable care in the performance thereof. The Bank
hereby agrees to use the funds deposited with it for payment
of the principal of and interest on the Bonds to pay the
Bonds as the same shall become due and further agrees to
establish and maintain all accounts and funds as may be
required for the Bank to function as Paying Agent.
Section 5 .02 . Reliance on Documents, Etc .
(a) The Bank may conclusively rely, as to the truth of
the statements and correctness of the opinions expressed
therein, on certificates or opinions furnished to the Bank by
the Issuer.
(b) The Bank shall not be liable to the Issuer for
actions taken under this Agreement so long as it acts in good
faith and exercises due diligence, reasonableness and care,
as prescribed by law, with regard to its duties hereunder.
(c) This Agreement is not intended to require the Bank
to expend its own funds for performance of any of its duties
hereunder.
(d) The Bank may exercise any of the powers hereunder
_ _ A i rcn+1 v nr by or
Section 5 . 03 . Recitals of Issuer.
The recitals contained in the Bond Ordinance and the
Bonds shall be taken as the statements of the Issuer, and the
Bank assumes no responsibility for their correctness.
Section 5 . 04 . May Own Bonds.
The Bank, in its individual or any other capacity, may
become the owner or pledgee of Bonds with the same rights it
would have if it were not the Paying Agent and Registrar for
the Bonds.
Section 5 . 05 . Money Held by Bank.
Money held by the Bank hereunder shall be held in trust
for the benefit of the Registered Owners of the Bonds.
The Bank shall be under no obligation to pay interest on
any money received by it hereunder.
All money deposited with the Bank hereunder shall be
secured in the manner and to the fullest extent required by
law for the security of funds of the Issuer.
Any money deposited with the Bank for the payment of the
principal or interest on any Bond and remaining unclaimed for
four years after the Stated Maturity of the Bond will be paid
by the Bank to the Issuer, upon receipt of a written Issuer
Request, and the Issuer and the Bank agree that the Regis-
tered Owner of such Bond shall thereafter look only to the
Issuer for payment thereof, and that all liability of the
Bank with respect to such moneys shall thereupon cease.
ARTICLE SIX
MISCELLANEOUS PROVISIONS
Section 6 . 01 . Amendment.
This Agreement may be amended only by an agreement in
writing signed by both of the parties hereof.
Section 6 . 02 . Assignment.
This Agreement may not be assigned by either party with-
out the prior written consent of the other.
Section 6 . 03 . Notices.
Any request, demand, authorization, direction, notice,
consent, waiver or other document provided or permitted
hereby to be given or furnished to the Issuer or the Bank
shall be mailed or delivered to the Issuer or the Bank,
respectively, at the addresses shown hereon, or such other
address as may have been given by one party to the other by
15 days written notice.
Section 6 . 04 . Effect of Headings.
The Article and Section headings herein are for con-
Section 6 . 05 . Successors and Assigns.
All covenants and agreements herein by the Issuer and
the Bank shall bind their successors and assigns, whether so
expressed or not.
Section 6 .06 . Severability.
If any provision of this Agreement shall be invalid or
unenforceable, the validity and enforceability of the re-
maining provisions hereof shall not in any way be affected or
impaired.
Section 6 .07 . Benefits of Agreement.
Nothing herein, express or implied, shall give to any
Person, other than the parties hereto and their successors
hereunder, any benefit or any legal or equitable right,
remedy or claim hereunder.
Section 6 . 08 . Bond Ordinance Governs Conflicts .
This Agreement and the Bond Ordinance constitute the
entire agreement between the parties hereto relative to the
Bank acting as Paying Agent and Registrar and if any conflict
exists between this Agreement and the Bond Ordinance, the
Bond Ordinance shall govern.
Section 6 .09 . Counterparts .
This Agreement may be executed in any number of counter-
parts, each of which shall be deemed an original and all of
which shall constitute one and the same Agreement.
Section 6 . 10 . Term and Termination.
This Agreement shall be effective from and after its
date for a term ending on the Stated Maturity date or Redemp-
tion Date of the last Bond to mature or be redeemed, which-
ever first occurs , and may be terminated for any reason by
the Issuer or Bank at any time upon 60 days written notice;
provided, however, that no such termination shall be effec-
tive until a successor has been appointed and has accepted
the duties of the Bank hereunder. In the event of early
termination regardless of circumstances , the Bank shall
deliver to the Issuer or its designee all funds and Bonds,
and all books and records pertaining to the Bank' s role as
Paying Agent and Registrar with respect to the Bonds, includ-
ing, but not limited to, the Bond Register.
Section 6 . 11 . Governing Law.
This Agreement shall be construed in accordance with and
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the day and year first above written.
CITY OF PEARLAND, E AS
By )09,1,t . p
Mayor
ATTEST: ADDRESS:
2335 North Texas
P. O. Box 1157
<a_e� Pearland, Texas 77581
City Vecretary
(SEAL)
FIRST CITY NATIONAL BANK OF
HOUSTON, Houston, Texas
Ti le ASSIANT VIC PRESIDENT &
TRUST OFFICER
ATTEST: ADDRESS:
Corporate Trust Department
,,� P. O. Box 809
n � i ,� - --- - -
Financial Guaranty Insurance MIME
Gmv
175Wanyer 1 VIC,M
Water Street
New York,New York 10038
(212)608-2400
(800)352-0001
An FGIC Company
•
Ann C.Stern
Senior Mee President
General Counsel
April 15, 1986
City of Pearland
Pearland, Texas
Shearson Lehman Brothers Inc.
New York, New York
Bear, Stearns & Co.
New York, New York
Smith Barney, Harris
Upham & Co. Incorporated
New York, New York
Gentlemen:
I am Senior Vice President and General Counsel of Financial
Guaranty Insurance Company ("Financial Guaranty") , and have
been requested to render an opinion in connection with the
issuance by Financial Guaranty of its Municipal Bond New
Issue Insurance Policy (the "Policy") delivered to First City
National Bank of Houston, Houston, Texas, as paying agent for
$4, 500, 000 in principal amount of City of Pearland, Texas
Public Improvement Bonds, Series 1986 (the "Bonds") . I have
examined such documents and records as I have deemed relevant
for purposes of this opinion, including (i) the Certificate
of Incorporation of Financial Guaranty, including all
amendments thereto, (ii) the amended By-laws of Financial
Guaranty as in effect on the date hereof, (iii) the
Certificate of Authority issued to Financial Guaranty by the
Superintendent of Insurance of the State of New York, (iv)
the Certificate of Authority issued to Financial Guaranty by
the Commissioner of Insurance of the State of Texas, (v) the
executed Policy and (vi) the statements in the Official
Statement dated March 10, 1986 relating to the Bonds (the
"Official Statement") under the caption "Bond Insurance" .
Financial Guaranty Insurance
Company
City of Pearland, Texas April 15, 1986
Shearson Lehman Brothers Inc. Page 2
Bear, Stearns & Co.
Smith Barney, Harris Upham & Co.
Incorporated
On the basis of the foregoing, it is my opinion that:
(1) Financial Guaranty is a stock insurance corporation
validly existing and in good standing under the laws of the
State of New York and qualified to do business therein and is
licensed and authorized to issue the Policy under the laws of
the State of Texas.
(2) The Policy is valid and binding upon Financial
Guaranty and enforceable in accordance with its terms,
subject to applicable laws affecting creditors ' rights
generally.
(3) Financial Guaranty, as an insurance company, is not
eligible for relief under the Federal Bankruptcy Laws. Any
proceedings for the liquidation, conservation or
rehabilitation of Financial Guaranty would be governed by the
provisions of the Insurance Law of the State of New York.
(4) The statements described above in the Official
Statement relating to Financial Guaranty and the Policy
accurately and fairly present the summary information set
forth therein and do not omit any material fact with respect
to the description of Financial Guaranty relative to the
material terms of the Policy or the ability of Financial
Guaranty to meet its obligations under the Policy.
Very truly yours,
Ann C. Stern
Senior Vice President
General Counsel
ACS/ar
_s
Financial Guaranty Insurance MEM
Company
175 Water Street
New York,New York 10038
(212) 607-3000
Municipal Bond New Issue Insurance Policy
Issuer: City of Pearland, Texas Policy Number: 86010025
Control Number: 0 010 001
Bonds: $4 , 500, 000 in principal P1emium: $48 , 000
amount of Public Improvement
Bonds, Series 1986
Financial Guaranty Insurance Company("Financial Guaranty"),a New York stock
insurance company,in consideration of the payment of the premium and subject to the
terms of this Policy,hereby unconditionally and irrevocably agrees to pay to Citibank,
N.A.,or its successor,as its agent(the'`Fiscal Agent"),for the benefit of Bondholders,that
portion of the principal and interest on the above-described debt obligations(the"Bonds")
which shall become Due for Payment but shall be unpaid by reason of Nonpayment by the Issuer.
Financial Guaranty will make such payments to the Fiscal Agent on the date such principal
or interest becomes Due for Payment or on the Business Day next following the day on
which Financial Guaranty shall have received Notice of Nonpayment,whichever is later.
The Fiscal Agent will disburse to the Bondholder the face amount of principal and interest
which is then Due for Payment but is unpaid by reason of Nonpayment by the Issuer but
only upon receipt by the Fiscal Agent in form reasonably satisfactory to it,of(i)evidence
of the Bondholder's right to receive payment of the principal or interest Due for Payment
and (ii)evidence,including any appropriate instruments of assignment,that all of the
Bondholder's rights to payment of such principal or interest Due for Payment shall
thereupon vest in Financial Guaranty.Upon such disbursement,Financial Guaranty shall
become the owner of the Bond,appurtenant coupon or right to payment of principal or
interest on such Bond and shall be fully subrogated to all of the Bondholder's rights
thereunder,including the Bondholder's right to payment thereof.
This Policy is non-cancellable for any reason.The premium on this Policy is not
refundable for any reason,including the payment of the Bonds prior to their maturity.This
Policy does not insure against loss of any prepayment premium which may at any time be
payable with respect to any Bond.
As used herein,the term"Bondholder"means,as to a particular Bond,the person other
than the Issuer who,at the time of Nonpayment,is entitled under the terms of such Bond to
payment thereof. "Due for Payment"means,when referring to the principal of a Bond,the
stated maturity date thereof or the date on which the same shall have been duly called for
mandatory sinking fund redemption and does not refer to any earlier date on which
payment is due by reason of call for redemption (other than by mandatory sinking fund
redemption),acceleration or other advancement of maturity and means,when referring to
SM:Service mark used by
Page 1 of 2 Form 9000 Financial Guaranty Insurance
Company under license from
its parent company,FGIC
Corporation
Financial Guaranty Insurance 111.111111
Company
175 water Street FGICas
New York,New York 10038
(212) 607-3000
Municipal Bond Issue Insurance Policy
interest on a Bond,the stated date for payment of interest."Nonpayment"in respect of a
Bond means the failure of the Issuer to have provided sufficient funds to the paying agent
for payment in full of all principal and interest Due for Payment on such Bond."Notice"
means telephonic or telegraphic notice,subsequently confirmed in writing,or written
notice by registered or certified mail from a Bondholder or a paying agent for the Bonds to
Financial Guaranty. "Business Day"means any day other than a Saturday,Sunday or a
day on which the Fiscal Agent is authorized by law to remain closed.
In Witness Whereof,Financial Guaranty has caused this Policy to be affixed with its
corporate seal and to be signed by its duly authorized officers in facsimile to become
effective and binding upon Financial Guaranty by virtue of the countersignature of its duly
, 17 • . authorized representative.
yam— QV/
President Executive Vice President
Counters neds�„ ��
License Hetft Agent`' 1
Effective Date: Aa r j i 15, 1936 Authorized Representative
Citibank,N.A.,acknowledges that it has agreed to perform the duties of Fiscal Agent
under this Policy.
Authorized Officer
SM:Service mark used by
Page 2 of 2 Form 9000 Financial Guaranty Insurance
Company under license from
its parent company,FGIC
Corporation
Financial Guaranty Insurance 11111109111
Company
175 Water Street
New York,New York 10038
(212)607-3000
Endorsement
To Financial Guaranty Insurance Company Insurance Policy
Policy Number: 86010025 Control Number: 0010001
It is further understood that the term"Nonpayment"in respect of a Bond includes any
payment of principal or interest made to a Bondholder by or on behalf of the issuer of such
Bond which has been recovered from such Bondholder pursuant to the United States
Bankruptcy Code by a trustee in bankruptcy in accordance with a final,nonappealable
order of a court having competent jurisdiction.
sig .)- In Witness Whereof,Financial Guaranty has caused this Endorsement to be affixed with its
corporate seal and to be signed by its duly authorized officers in facsimile to become
effective and binding upon Financial Guaranty by virtue of the countersignature of its duly
authorized representative.
• )6 -t
•
• =' Preside Executive Vice President
Countersigned: , d
en iden� AgenE
Effective Date: AD r i l 15, 1 g 8 6 Authorized Representative
Acknowledged as of the Effective Date written above:
Authorized Officer
Citibank,N.A.,as Fiscal Agent
X
SM:Service mark used by
Page 1 of 1 Form E-0002 Financial Guaranty Insurance
Company under license from
its parent company,FGIC
Corporation
OFFICIAL STATEMENT CERTIFICATE
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
We, the undersigned, Mayor, City Secretary, and City
Manager, respectively, of the CITY OF PEARLAND, TEXAS (the
"City") , acting in our official capacity as such, hereby
certify with respect to that issue of "City of Pearland,
Texas, Public Improvement Bonds, Series 1986" , in the
principal amount of $4 ,500 , 000 (the "Bonds") , as follows:
That, to the best of our knowledge and belief:
(a) the description and statements of or pertaining
to the City contained in its Preliminary and
final Official Statements , on the respective
dates of such statements, on the date of sale of
the Bonds and the acceptance of the best bid
therefor, and on the date of the delivery of the
Bonds, were and are true and correct in all
material respects;
(b) insofar as the City and its affairs, including
its financial affairs, are concerned, such
Preliminary and final Official Statements did
not and do not contain an untrue statement of a
material fact or omit to state a material fact
required to be stated therein or necessary to
make the statements therein, in the light of the
circumstances under which they were made, not
misleading; and
(c) insofar as the descriptions and statements , in-
cluding financial data, contained in such
Preliminary and final Official Statements, of or
pertaining to entities other than the City and
their activities are concerned, such statements
and data have been obtained from sources which
the City believes to be reliable and that the
City has no reason to believe that they are
untrue in any material respect.
EXECUTED this APR 1 5 1986 , the date of
payment for and delivery of the Bonds .
CITY OF PEARLAND, TEXAS
BY:
c---A)-7.2 I/ '"
Mayor
City Secr4ary
(SEALI A 1 .., I / � �� . 0
NO-ARBITRAGE AND USE OF PROCEEDS CERTIFICATE
OF THE
CITY OF PEARLAND, TEXAS
THE STATE OF TEXAS §
§
COUNTY OF HARRIS §
I, the undersigned Mayor of the City of Pearland, Texas
(the "City") , make this certification for the benefit of all
persons interested in the exemption from federal income
taxation of the interest to be paid on the City' s Public
Improvement Bonds, Series 1986, in the aggregate principal
amount of $4, 500, 000 (the "Bonds") , which are being issued
and delivered simultaneously with the delivery of this
certificate, and do hereby certify as follows:
1 . Executing Official. I am the duly elected Mayor
of the City; as such, I am familiar with the facts herein
certified and I am duly authorized to execute and deliver
this certificate.
2 . Qualification of Official. I am charged, along
with others, with responsibility for issuing the Bonds. I
am aware of the provisions of Section 103 (c) of the Internal
Revenue Code of 1954 , as amended (the "Code") , and the
Treasury Regulations (the "Regulations") heretofore promul-
gated thereunder. This certificate is being executed and
delivered pursuant to such Regulations and certain terms
used herein have the same meanings given to such terms in
the Regulations.
3 . Reasonable Expectations. Except with respect to
the matters set forth in paragraph 13 , this certification is
based on the facts and estimates in existence on the date of
issue of the Bonds, and to the best of my knowledge and
belief the expectations set forth herein are reasonable in
the light of such facts and estimates .
4 . Governmental Purpose. The Bonds are being issued
for the purpose of providing funds to finance (i) the
extension, improvement or betterment of the City' s roads,
(ii) the extension, improvement or betterment of the City' s
sewer system, (iii) the construction of a new city hall
building (the "Project") , and (iv) the costs of issuance of
the Bonds, all as more fully described and approved in an
ordinance adopted by the City Council of the City on
March 10 , 1986 (the "Ordinance") , and in the Official
Statement with respect to the Bonds dated March 10 , 1986 .
All capitalized terms appearing herein have the meaning
ascribed to such terms in the Ordinance unless otherwise
defined.
5 . Amount and Use of Proceeds. The City will receive
proceeds from the sale of the Bonds equal to $4 , 512,504 . 24
which amount is equal to the face amount of the Bonds, equal
to $4,500 ,000 .00 , plus accrued interest to the date of
delivery of the Bonds, equal to $12,504 .24 . Proceeds of the
Bonds (exclusive of the accrued interest) will be deposited
in the Construction Fund and disbursed to pay the Project
costs and issuance costs in the amounts set forth below:
Project Costs $4,459 ,619
Costs of Issuance 40, 381
TOTAL $4 , 500, 000
6 . Use of Investment Proceeds. All investment
proceeds resulting from the investment of any proceeds of
the Bonds pending expenditure of such proceeds for costs of
the Project will be (i) retained in the Construction Fund
and used to pay or reimburse other Project costs (to the
extent such interest and other Project costs were not paid
out of the original proceeds of the Bonds) or (ii) trans-
ferred to the Interest and Sinking Fund and used to pay
interest on the Bonds for not more than three years follow-
ing the date of issue of the Bonds.
7 . No Overissuance. Based on the foregoing represen-
tations , the City expects that the original proceeds and
investment proceeds of the Bonds will not exceed the amount
necessary for the governmental purposes of the Bonds by more
than five percent of such amount, if at all.
8 . Temporary Period Requirements .
A. Time Test. The City will incur a binding
obligation to a third party to construct or acquire the
Project within 180 days of the date hereof pursuant to which
the City will be obligated to expend at least $100 ,000 .
- 2 -
B. Expenditure Test. The City reasonably
expects that at least 85 percent of the original proceeds of
the Bonds will have been expended on the Project prior to
April 1 , 1989 .
C. Due Diligence. The City reasonably expects
that acquisition and construction of the Project will
proceed with due diligence to completion and that the
proceeds of the Bonds will be expended on the Project with
reasonable dispatch.
9 . Temporary Period for Investment Proceeds. The
City reasonably expects that any amount derived from the
investment of moneys received from the sale of the Bonds and
from the investment of such investment income will be
expended within three years from the date of delivery of the
Bonds or one year after receipt of such investment income,
whichever is later, for purposes described in paragraph 6 . •
10. Flow of Funds. Under the Ordinance, all taxes
levied, assessed and collected for and on account of the
Bonds will be deposited, as collected, in the Interest and
Sinking Fund. The City expects that amounts deposited in
the Interest and Sinking Fund each year will be sufficient
to pay debt service on the Bonds.
11 . Interest and Sinking Fund. The Interest and
Sinking Fund established in the Ordinance will be used
primarily to achieve a proper matching of revenues and debt
service on the Bonds within each bond year. As set forth
above, taxes levied, assessed and collected are anticipated
to be sufficient to pay debt service each year on the Bonds.
The Interest and Sinking Fund will be depleted at least once
each year except for a reasonable carryover amount not to
exceed the greater of (i) one year' s earnings on the Inter-
est and Sinking Fund or (ii) one-twelfth of annual debt
service.
12 . Sinking Funds. Other than the Construction Fund
and the Interest and Sinking Fund, there are no other funds
or accounts comprised of securities, evidences of indebted-
ness or other obligations established by and on behalf of
the City which are reasonably expected to pay debt service
on the Bonds or which are reserved or pledged as collateral
for payment of debt service on the Bonds, and for which
- 3 -
there is reasonable assurance that amounts therein will be
available to pay such debt service if the City encounters
financial difficulties. Uses of amounts in the Construction
Fund and the Interest and Sinking Fund are described above,
and therefore, there is no other fund established, or to be
created or established, which would be treated as a sinking
fund in connection with the Bonds.
13 . Compliance with H.R. 3838 . Notwithstanding
anything contained herein to the contrary, the City has
covenanted in the Ordinance that it will take all steps
necessary to preserve the tax-exempt status of interest on
the Bonds including compliance with H.R. 3838 , the Tax
Reform Act of 1985 (the "Bill") , as passed by the United
States House of Representatives on December 17 , 1985 , until
such time as the City receives an opinion of nationally
recognized bond counsel to the effect that such steps are no
longer necessary. Without limiting the generality of the
covenants in the Ordinance , such covenants include the
following:
A. Essential Function Bonds . None of the
proceeds of the Bonds will be used directly or indirectly
(i) to make or finance loans to persons or (ii) to acquire
or construct facilities to be used in any trade or business
carried on by any person (other than use as a member of the
general public) . For purposes of the preceding sentence ,
the term "person" does not include a governmental unit other
than the United States or any agency or instrumentality
thereof and the term "trade or business" means any activity
carried on by a person other than a natural person.
B . No Early Issuance. The City will expend
(i.e. actually disburse to third parties) an amount in
excess of $223 , 606 . 16 , which is equal to five percent of the
net proceeds of the Bonds , within 30 days after the date of
delivery of the Bonds , to carry out the governmental purpose
of the Bonds; further, the City will expend (i.e . actually
disburse to third parties) an amount equal to the net pro-
ceeds of the Bonds within three years after the date of
delivery of the Bonds to carry out the governmental purpose
of the Bonds . For this purpose , the term "net proceeds"
means the proceeds of the Bonds actually received by the
City reduced by the costs of issuance of the Bonds . Com-
puted in this manner, the net proceeds of the Bonds are
expected to equal $4 , 472 , 123 . 24 . All expenditures to be
- 4 -
made in satisfaction of the foregoing requirements will be
reflected on the City' s books and records as having been
made with the proceeds of the Bonds and not some other
source.
C. Temporary Periods . Except as provided below,
the proceeds of the Bonds will not be invested in securi-
ties , obligations, annuity contracts or investment type
properties (collectively, referred to herein as "Acquired
Obligations") that bear a yield that exceeds the yield of
the Bonds by more than one-eighth of one percentage point.
The term "yield" means that yield which when used in
computing the present worth of all payments of principal and
interest to be paid on the obligation produces an amount
equal to the purchase price of such obligation. The yield
on both the Bonds and the Acquired Obligations shall be
calculated by the same frequency interval of compounding
interest. In the case of the Bonds , the term "purchase
price" means the initial offering price of the Bonds to the
public. Any underwriters discount, issuance costs or costs
of carrying or repaying the Bonds shall not be taken into
account as an adjustment to the purchase price. Based upon
the representation of Shearson Lehman Brothers , Inc. set
forth in Exhibit A hereto, the initial "offering price"
(including accrued interest) of the Bonds to the public at
which a substantial number of Bonds were sold aggregated
$4,574 , 609 . 74 . As set forth in Exhibit B, the City' s
Financial Advisor, Underwood, Neuhaus & Co. , Inc. , has
calculated the yield on the Bonds based upon this "purchase
price" to be 6 . 804827 percent. In the case of Acquired
Obligations, the term "purchase price" means the mean of the
bid and offered prices on an established market where such
Acquired Obligations are traded on the date of a binding
contract to acquire such Acquired Obligations. If Acquired
Obligations purchased by the City include any investment
contracts (or similar arrangements, such as negotiated rate
bank accounts) the City will follow the procedures for
bidding such contracts set forth in Temp. Treas. Reg.
§1 . 103-15AT (d) (b) (iii) so as to avoid any "prohibited
payment" as defined in Temp. Treas. Reg. §1 . 103-15AT (d) . As
used herein, the term "Acquired Obligations" does not
include obligations described in section 103 (a) of the Code.
The foregoing requirements do not apply to proceeds of the
Bonds invested as follows:
(i) Proceeds of the Bonds that are used in
connection with the acquisition of tangible property
- 5 -
and that are invested for a period not in excess of 30
days from the date of delivery of the Bonds.
(ii) Proceeds of the Bonds that are used for
construction expenditures and that are invested for a
period beginning on the date of delivery of the Bonds
and ending on the earlier of --
(a) the date on which construction is
substantially (i.e. 90 percent) completed or is
abandoned;
(b) the date on which an amount equal to the
proceeds of the Bonds has been expended on the
Project; or
(c) the date which is three years after the
earlier of (1) the date of delivery of the Bonds
or (2) the date construction begins.
For purposes of this paragraph, the term "construction"
includes reconstruction and rehabilitation.
The City expects that all of the proceeds of the Bonds
will be expended for the purposes of construction. Thus,
the City will invest the proceeds of the Bonds in accordance
with the provisions of paragraph (ii) hereof.
D. Investment in Nonpurpose Obligations. Except
for amounts invested during the temporary periods described
in subparagraph (C) hereof and except for the temporary
investment of amounts on deposit in the Interest and Sinking
Fund, at no time during any bond year will the amounts
invested in Acquired Obligations with a yield materially
higher than the yield on the Bonds (in both cases as deter-
mined under the method set forth in subparagraph (C) hereof)
exceed 150 percent of the debt service on the Bonds for the
bond year. Furthermore, such amount so invested will be
promptly and appropriately reduced as the amount of the
outstanding obligations of the Bonds are reduced.
E. Rebate of Positive Arbitrage. The City will
comply with the requirements of Section 147 (e) of the Code
as amended by the Bill relating to the required rebate to
the United States. Specifically, the City will take steps
to ensure that all earnings on gross proceeds of the Bonds
(as defined in section 147 (e) (6) (B) ) in excess of the yield
- 6 -
on the Bonds as defined in subparagraph (C) required to be
rebated to the federal government will be timely paid.
F. Records. In order to comply with the fore-
going requirements and regulations, the City will account
for all of the proceeds of the Bonds deposited in the
Construction Fund, as well as amounts on deposit in the
Interest and Sinking Fund which are allocable to the Bonds,
and all investments of such amounts, separately from amounts
on deposit in such funds and investments allocable to
previous and subsequent public improvement bonds.
G. Reports . I have examined the completed
Internal Revenue Service Form 8038 , a copy of which is
attached hereto, including accompanying Schedules and
statements , and to the best of my knowledge and belief, it
is true, correct and complete.
16 . No Artifice or Device. The Bonds are not and will
not be part of a transaction or series of transactions that
attempt to circumvent the provisions of section 103 (c) of
the Code and the Regulations (i) enabling the City to
exploit the difference between tax-exempt and taxable
interest rates to gain a material financial advantage and
(ii) increasing the burden on the market for tax-exempt
obligations.
17 . Issue. There are no other obligations of the City
which (i) are to be issued at substantially the same time as
the Bonds, (ii) are to be sold pursuant to a common plan of
financing together with the Bonds and (iii) will be paid out
of substantially the same source of funds or will have
substantially the same claim to be paid out of substantially
the same source of funds as the Bonds .
18. No-Arbitrage. On the basis of the foregoing
facts, estimates and circumstances, it is not expected that
the proceeds of the Bonds will be used in a manner that
would cause the Bonds to be "arbitrage bonds" within the
meaning of section 103 (c) of the Code and the Regulations.
To the best of the knowledge and belief of the undersigned,
there are no other facts , estimates or circumstances that
will materially change such expectations .
19. No Listing. The City has not been notified nor is
the City aware of any listing or proposed listing of it by
the Commissioner of Internal Revenue, by publication in the
- 7 -
Internal Revenue Bulletin, or otherwise, to the effect that
it may not certify the Bonds.
WITNESS MY HAND and the official seal of the City this
/1"-/ day of April, 1986 .
CITY OF PEARLAND, TEXAS
(.. )47),7A_, 7/ P'
Mayor,
Pearland, Texas
(SEAL)
- 8 -
EXHIBIT A
CERTIFICATE REGARDING PURCHASE PRICE
We, the undersigned, have acted as underwriters in
connection with the sale and issuance of the City of
Pearland Public Improvement Bonds, Series 1986 , in the
aggregate principal amount of $4 ,500 ,000 (the "Bonds") . In
our capacity as underwriters , we hereby certify that the
initial offering price (including accrued interest) of the
Bonds to the public at which a substantial number of Bonds
were sold aggregated $4 ,574,609. 74 .
SHEARSON LEHMAN BROTHERS, INC.
61143C71- /
Title: .�
EXHIBIT B
CERTIFICATE REGARDING YIELD
We, the undersigned, have acted as financial advisor to
the City of Pearland (the "City") in connection with the
sale and issuance of the City' s Public Improvement Bonds,
Series 1986 , in the aggregate principal amount of $4 ,500 ,000
(the "Bonds") . We have been informed that the initial
offering price (including accrued interest) of the Bonds to
the public at which a substantial number of Bonds were sold
aggregated $4 ,574 ,609. 74. Based on that initial offering
price, we have calculated the yield on the Bonds to be
6 . 804827 percent. For purposes of this certificate, the
term "yield" means that yield which when used in computing
the present worth of all payments of principal and interest
to be paid on the obligation produces an amount equal to the •
purchase price of such obligation.
UNDERWOOD, NEUHAUS & CO. ,
INCORPORATED
Title: F (42cr ))10E PIeLSl �E
TREASURER' S RECEIPT
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
I , the undersigned, Treasurer of the City of Pearland, Texas,
certify as follows:
1 . That on APR 15 1986 , I delivered to the Purchaser
thereof the following described bonds, hereinafter called the "Bonds" :
CITY OF PEARLAND, TEXAS, PUBLIC IMPROVEMENT BONDS,
SERIES 1986 , dated April 1 , 1986 , aggregating
$4 ,500 ,000 , and maturing on March 1 in each of the years
1987 through 2003 , both inclusive.
2 . At the time of such delivery, I received from said Purchaser
full payment for the Bonds in keeping with the order, ordinance or
resolution authorizing the issuance thereof and the order, ordinance or
resolution awarding the sale thereof, said full purchase price being
par plus accrued interest from date to delivery.
IN WITNESS WHEREOF, I have hereunto set my hand and the official
seal of said City, on APR 1 5 NPR
(SEAL) L.. /> 77.4 _46? 3'f'�?d��^�
Treasurer J
NO-LITIGATION CERTIFICATE
We, the undersigned officers of said City of Pearland, Texas, do
hereby certify that at the time of delivery of the Bonds, as set forth
in the Treasurer' s Receipt above, there was not pending, and, to our
knowledge, there was not threatened, any litigation affecting the
validity of the Bonds, or the levy and/or collection and/or pledge of
funds for the payment thereof, or the organization or boundaries of
said City, or the title of the officers thereof to their respective
offices, and that no additional bonds, warrants or other indebtedness
have been issued since the date of the statement of indebtedness or
non-encumbrance certificate submitted to the Attorney General of Texas
in connection with the approval of the Bonds .
WITNESS OUR HANDS AND THE OFFICIAL SEAL OF SAID CIT , on
APR 1 5 1986
!
Mayor: __.-- 0.1-2
(SEAL)
City Secretary:
The foregoing signatures of the above Treasurer, Mayor, and City
Secretary are hereby certified to be genuine.
Pearland State Bank
Name of Bank
Pearland,Tx 77581
ty
(BANK SEAL)
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;C `T < -fif"' � --a UNITED STATES OF AMERICA-STATE OF TEXAS-COUNTIES OF BRAZORIA AND HARRIS v• • ••
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°, � ,;, } CITY OF PEARLAN � , TEXAS ;,{; ,. ;�s
7. c` ` 1 fY.P4,t'ptV-7 IrI �'; PUBLIC IMPROVEMENT BOND, SERIES 1986 f }tSi� @
ak i'42 dui. ,,. rr V...:. t ii ,l it .++ i4d a „,„ t,,T,., / iri. + t INTEREST RATE: MATURITY DATE. ISSUE DATE: CUSIP NO + � rr oQ•r sw � Y sYA`raS��j,qAPRIL 1, 1986 r.
ar
as++i .. . tr REGISTERED OWNER: _ -_ '�'; �, ;Y1r A
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�i * 1 . �C,F` � * ; —�AtNCiPAL AMOUNT: - _ - DOLLARS �� k'r�i
:?' A., rlt;•'r _ 4. . THE CITY OF PEARLAND, TEXAS (the "City") promises to pay to the Registered Owner identified above, or registered assigns, on the date specified
�,f ^r �,ts7;a a err ^ � .3 above, upon presentation and surrender of this bond at the principal corporate trust office of the FIRST CITY NATIONAL BANK OF HOUSTON, HOUSTON,
4.-4 t��:7 "ffi` t '` ". "� TEXAS (the "Registrar"), the principal amount identified above, payable in anycoin or currencyof the United States of America which on the date of `'lam„ w = q,''{t„"", ;. e "t' t 't-`A
J�' its t ix ,�yw/ �{,'s'�ttih,�fr psi, t��f ,� payment of such principal is legal tender for the payment of debts due the United States of America, and to pay interest thereon at the rate shown above ��. .
,t :W ••'42 it O, k8V.:."`tf t;}a'sf.1 i� calculated on the basis of a 360 day year of twelve 30 day months, from the later of April 1, 1986, or the most recent interest payment date to which s }s{ f t'j
r t�sr !?wit Arks •, 0,;.„ •Hsu_, Interest has been paid or duly provided for. Interest on this bond is payable by check or draft payable on September 1, 1986 and semiannually thereafter on � � 4 .r
` r if,,9t 4� 1 each March 1 and September 1, mailed to the registered owner as shown on the books of registration kept bythe Registrar as of the 15th calendar date of ,,,
: ,�,;•S ,fey� r�4 / .�,� the month next preceding each interest payment date. i:,
'4 GJ �n l�p `i4 r� 4 �1
.,>sr �`��, REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE HEREOF, WHICH PROVISIONS , \ .,I
7'' f l `t ' �,'q 1•1. '" a ', I SHALL HAVE THE SAME FORCE AND EFFECT AS IF SET FORTH AT THIS PLACE. #1 fi '` ��1R'�
`. t4r,ty,'• s, ' +I,, 3 r. ,,+SA ;' IN WITNESS WHEREOF, this bond has been signed with the manual or facsimile signature of the Mayor of the City and countersigned with the manual ,• 'ti"f +� ,...4. `'
dtti} } ' ••• i •r or facsimile signature of the City Secretary of the City, and the official seal of the City has been duly impressed, or placed in facsimile, on this bond. i; ''6r
r •44, �-�- '�'$ tO� , Registration Date: L•,
^ +�` 'igti 'e�,'� y,,N ,,, , CITY OF PEARLAND,TEXAS
'Alt
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!rt e 7t ' ! i .: 7, / b 10 AUTHENTICATION CERTIFICATE ,
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tl I < 4 < <j a «� This bond is one of the bonds described in and deliveredeD Y , y t Pursuant to ,d j f 44 b i the within-mentionedOrdinance ti 11 f /�r ht+
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Houston,Texas �\ ' Nr •
4.•79
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i Y i 7 ,� t BY ��,n,n m„'N,N,t`y >i,it 000
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�p `City Secretaryr'.,
t�Y } I I Authorized Officer Y _ ,i {}}�a {
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ii:kf Sti`u:r 'r i g4),:rl r� t"
MIDWEST BANK NOTE COMPANY,PLYMOUTH MICH '