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R95-15 03-13-95 i RESOLUTION NO. R95 -15 CERTIFICATE FOR RESOLUTION 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 a regular meeting on the 13th day of March, 1995, at the regular meeting place thereof, within the City, and the roll was called of the duly constituted officers and members of the City Council and the City Secretary, to wit: C.V. Coppinger Mayor D.A. Miller, Jr. Council Member Richard Tetens Council Member Randy K. Weber Council Member Jerry Richardson Council Member David L. Smith Council Member Tommie Jean Vial Interim City Secretary and all of such persons were present, thus constituting a quorum. Whereupon, among other business, the following was transacted at such meeting: a written RESOLUTION AUTHORIZING PUBLICATION OF NOTICE OF INTENTION TO ISSUE CERTIFICATES OF OBLIGATION IN A PRINCIPAL AMOUNT NOT TO EXCEED $5,500,000 FOR THE ACQUISITION, CONSTRUCTION AND IMPROVEMENT OF CERTAIN PUBLIC WORKS, AUTHORIZING DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT RELATING TO SUCH CERTIFICATES AND AUTHORIZING CERTAIN OTHER MATTERS RELATING THERETO (the "Resolution was duly introduced for the consideration of the City Council and read in full. It was then duly moved and seconded that such Resolution be adopted; and, after due discussion, the motion, carrying with it the adoption of the Resolution, prevailed and carried by the following vote: AYES Q NOES 2. That a true, full and correct copy of the aforesaid Resolution adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been duly recorded in the City Council's minutes of the meeting; that the above and foregoing paragraph is a true, full and correct excerpt from the City Council's minutes of the meeting pertaining to the adoption of the Resolution; 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 purpose of the aforesaid meeting, and that the Resolution would be introduced and considered for adoption at the meeting, and each of the officers and members consented, in advance, to the holding of such meeting for such purpose; that the meeting was open to the public as required by law; and that public notice of the date, hour, place and subject of the meeting was given as required by the Open Meetings Law, Chapter 551, Texas Government Code, as amended. SIGNED AND SEALED this L day of March, 1995. 1. jrntiritUL. City Secretary (Inte m) Mayor (pro -Tem City of Pearland, Texas City of Pearland, Tex.. (SEAL) 0212005.01 039513/1045 2 RESOLUTION NO. R95 -15 RESOLUTION AUTHORIZING PUBLICATION OF NOTICE OF INTENTION TO ISSUE CERTIFICATES OF OBLIGATION IN A PRINCIPAL AMOUNT NOT TO EXCEED $5,500,000 FOR THE ACQUISITION, CONSTRUCTION AND IMPROVEMENT OF CERTAIN PUBLIC WORKS, AUTHORIZING DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT RELATING TO SUCH CERTIFICATES AND AUTHORIZING CERTAIN OTHER MATTERS RELATING THERETO STATE OF TEXAS COUNTIES OF BRAZORIA AND HARRIS CITY OF PEARLAND WHEREAS, the City Council (the "City Council of the City of Pearland, Texas (the "City"), is authorized to issue certificates of obligation to pay contractual obligations to be incurred for the construction of public works, for the purchase of materials, supplies, equipment, machinery, buildings, land and rights -of -way for authorized needs and purposes, and for professional services rendered in connection therewith pursuant to Texas Local Government Code sections 271.041 -.064, as amended; WHEREAS, the City Council has determined that it is in the best interests of the City and otherwise desirable to issue certificates of obligation in a principal amount not to exceed $5,500,000 styled "City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995" (the "Certificates for the acquisition, construction and improvement of certain public works to be used for authorized needs and purposes; WHEREAS, in connection with the Certificates, the City Council intends to publish notice of intent to issue the Certificates (the "Notice in a newspaper of general circulation in the City; WHEREAS, for purposes of providing for the sale of the Certificates, this City Council intends to authorize the preparation of a Preliminary Official Statement (the "Preliminary Official Statement to be used by the underwriters in the public offering of the Certificates; and WHEREAS, this City Council has been presented with and has examined the proposed form of Notice and finds that the form and substance thereof are satisfactory, and that the recitals and findings contained therein are true, correct and complete. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS: 1 Section 1. Preamble. The facts and recitations contained in the preamble of this Resolution are hereby found and declared to be true and correct. Section 2. Authorization of Notice. The City Secretary is hereby authorized and directed to execute and deliver the Notice set forth in Exhibit A hereto and to publish such Notice on behalf of the City in both English and Spanish once a week for two (2) consecutive weeks in a newspaper which is of general circulation in the City, the date of the first publication to be at least fifteen (15) days before the date tentatively set in the Notice for the passage of the ordinance authorizing the issuance of the Certificates. Section 3. Engagement of Professionals. This City Council hereby approves the engagement of certain professional firms in connection with the sale and delivery of the Certificates. Rauscher Pierce Refsnes, Inc., as financial advisor (the "Financial Advisor and Mayor, Day, Caldwell Keeton, L.L.P., as bond counsel "Bond Counsel are hereby approved in connection with the issuance of the Certificates pursuant to the terms of the agreements with such professional firms in substantially the forms attached hereto as Exhibit B and Exhibit C, respectively. Section 4. Authorization of a Preliminary Official Statement. This City Council hereby approves the preparation and distribution by the Financial Advisor to prospective purchasers of the Certificates of the Preliminary Official Statement, as the same may be completed, modified, or supplemented with the approval of the Mayor or other authorized officers and agents of the City. Section 5. Authorization of Other Matters Relating Thereto. The Mayor, City Secretary and other officers and agents of the City are hereby authorized and directed to do any and all things necessary or desirable to .carry out the provisions of this Resolution. Section 6. Effective Date. This Resolution shall take effect immediately upon passage. Section 7. Public Meeting. It is officially found determined and declared that the Y meeting at which this Resolution is adopted was open to the public and public notice of the time, place and subject matter of the public business to be considered at such meeting, including this Resolution, was given all as required by the Texas Government Code, Chapter 551, as amended. 2 s PASSED AND APPROVED this /3 day of March, 1995 Mayor pro -Tem) City of Pearland, Texas ATTEST: A 74/ Thkel /14 City Secretary (I n t rim City of Pearland, Texas (SEAL) 0212005.01 039513/1045 3 EXHIBIT A TO RESOLUTION NOTICE OF INTENTION TO ISSUE CERTIFICATES NOTICE IS HEREBY GIVEN that the City Council of the City of Pearland, Texas (the "City will meet at its regular meeting place at City Hall, Pearland, Texas at 7:30 p.m. on the 24th day of April, 1995, which is the time and place tentatively set for the passage of an ordinance and such other action as may be deemed necessary to authorize the issuance of the City's certificates of obligation, payable from ad valorem taxation and a subordinate pledge of certain revenues of the City's water and sewer system, in the maximum aggregate principal amount of $5,500,000, bearing interest at any rate or rates, not to exceed the maximum interest rate now or hereafter authorized by law, as shall be determined within the discretion of the City Council at the time of issuance and maturing over a period of years not to exceed forty (40) years from the date thereof, for the purpose of evidencing the indebtedness of the City to be incurred (1) for certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Lizer Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Lizer Road; renovations and improvements to Shadybend Drive (including drainage) from Liberty Drive to Misty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West Broadway and O'Day Road, (2) for renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's public library located at 3523 Liberty Drive, Pearland, Texas 77581, (3) for the acquisition, construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City -wide storm water drainage plan, and (4) for professional services. WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this 13th day of March, 1995. City Secretary (I n ter m City of Pearland, Texas (SEAL) 0212005.01 039513/1045 CITY OF PEARLAND, TEXAS S5,000,000 COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION SERIES 1995 TRANSCRIPT OF PROCEEDINGS MAYOR, DAY, CALDWELL & KEETON, L.L.P. 700 Louisiana, Suite 1900 Houston, Texas 77002 (713) 225-7000 CITY OF PEARLAND, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION SERIES 1995 INDEX OF CONTENTS I. CERTIFICATE PROCEEDINGS AND DOCUMENTS Resolution Authorizing Publication of Notice 1 of Intention to Issue Certificates Affidavits of Publication of Notice of Intent 2 Ordinance Authorizing Issuance of the Certificates 3 Preliminary Official Statement and 4 Official Notice of Sale Official Statement 5 Paying Agent/Registrar Agreement 6 II. CERTIFICATES General Certificate 7 Signature Identification and No-Litigation Certificate 8 No-Arbitrage Certificate and Form 8038G 9 Certificate of Assessed Valuation 10 Closing Certificate 11 Certificate of City Manager 12 Official Statement Certificate of the Bond Insurer 13 III, OPINIONS Approving Opinion of Bond Counsel 14 Opinion of Attorney General of Texas with 15 Certificate of Comptroller of Public Accounts Opinion of Counsel to the Bond Insurer 16 IV. MISCELLANEOUS Receipt and Cross Receipt 17 Registrar's Receipt 18 Reliance Letter to the Bond Insurer 19 Specimen Insurance Policy 20 Rating Agency Letters 21 Specimen Certificate 22 Winning Bid 23 0212142.01 069519/0910 1 2 r Council's minutes of the meeting pertaining to the adoption of the Resolution; 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 purpose of the aforesaid meeting, and that the Resolution would be introduced and considered for adoption at the meeting, and each of the officers and members consented, in advance, to the holding of such meeting for such purpose; that the meeting was open to the public as required by law; and that public notice of the date, hour, place and subject of the meeting was given as required by the Open Meetings Law, Chapter 551, Texas Government Code, as amended. SIGNED AND SEALED this /3 day of March, 1995. ity Secretary ( IWterim) Mayor (Pro-Tam) City of Pearland, Texas City of Pearland, Texas (SEAL) 0212005.01 039513/1049 2 r RESOLUTION NO. R95-15 RESOLUTION AUTHORIZING PUBLICATION OF NOTICE OF INTENTION TO ISSUE CERTIFICATES OF OBLIGATION IN A PRINCIPAL AMOUNT NOT TO EXCEED $5,500,000 FOR THE ACQUISITION, CONSTRUCTION AND IMPROVEMENT OF CERTAIN PUBLIC WORKS, AUTHORIZING DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT RELATING TO SUCH CERTIFICATES AND AUTHORIZING CERTAIN OTHER ' MA FI'ERS RELATING THERETO STATE OF TEXAS § COUNTIES OF BRAZORIA AND HARRIS § CITY OF PEARLAND § WHEREAS, the City Council (the "City Council") of the City of Pearland, Texas (the "City"), is authorized to issue certificates of obligation to pay contractual obligations to be incurred for the construction of public works, for the purchase of materials, supplies, equipment, machinery, buildings, land and rights-of-way for authorized needs and purposes, and for professional services rendered in connection therewith pursuant to Texas Local Government Code sections 271.041-.064, as amended; WHEREAS, the City Council has determined that it is in the best interests of the City and otherwise desirable to issue certificates of obligation in a principal amount not to exceed $5,500,000 styled "City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995" (the "Certificates") for the acquisition, construction and improvement of certain public works to be used for authorized needs and purposes; P WHEREAS, in connection with the Certificates, the City Council intends to publish notice of intent to issue the Certificates (the "Notice") in a newspaper of general circulation in the City; WHEREAS, for purposes of providing for the sale of the Certificates, this City Council intends to authorize the preparation of a Preliminary Official Statement(the "Preliminary Official Statement") to be used by the underwriters in the public offering of the Certificates; and WHEREAS, this City Council has been presented with and has examined the proposed form of Notice and finds that the form and substance thereof are satisfactory, and that the recitals and findings contained therein are true, correct and complete. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS: 1 r Section 1. Preamble. The facts and recitations contained in the preamble of this Resolution are hereby found and declared to be true and correct. • Section 2. Authorization of Notice. The City Secretary is hereby authorized and directed to execute and deliver the Notice set forth in Exhibit A hereto and to publish such Notice on behalf of the City in both English and Spanish once a week for two (2) consecutive weeks in a newspaper which is of general circulation in the City, the date of the first publication to be at least fifteen (15) days before the date tentatively set in the Notice for the passage of the ordinance authorizing the issuance of the Certificates. Section 3. Engagement of Professionals. This City Council hereby approves the engagement of certain professional firms in connection with the sale and delivery of the Certificates. Rauscher Pierce Refsnes, Inc., as financial advisor (the "Financial Advisor") and Mayor, Day, Caldwell & Keeton, L.L.P., as bond counsel ("Bond Counsel"), are hereby r" approved in connection with the issuance of the Certificates pursuant to the terms of the agreements with such professional firms in substantially the forms attached hereto as Exhibit B and Exhibit C, respectively. Section 4. Authorization of a Preliminary Official Statement. This City Council hereby approves the preparation and distribution by the Financial Advisor to prospective purchasers of the Certificates of the Preliminary Official Statement, as the same may be completed, modified, or supplemented with the approval of the Mayor or other authorized officers and agents of the City. r" Section 5. Authorization of Other Matters Relating Thereto. The Mayor, City Secretary and other officers and agents of the City are hereby authorized and directed to do any and all things necessary or desirable to carry out the provisions of this Resolution. Section 6. Effective Date. This Resolution shall take effect immediately upon passage. Section 7. Public Meeting. It is officially found, determined and declared that the meeting at which this Resolution is adopted was open to the public and public notice of the time, place and subject matter of the public business to be considered at such meeting, including this Resolution, was given all as required by the Texas Government Code, Chapter 551, as amended. r 2 V PASSED AND APPROVED this /3 day of March, 1995. r ; Mayor (Pro-Tern City of Pearland, Texas ATTEST: r )6,nao' t-u. )1.4.ce City Secretary (I terim) City of Pearland, Texas (SEAL) r 0212005.01 039513/1049 r r I P 3 EXHIBIT A TO RESOLUTION NOTICE OF INTENTION TO ISSUE CERTIFICATES NOTICE IS HEREBY GIVEN that the City Council of the City of Pearland, Texas (the "City") will meet at its regular meeting place at City Hall, Pearland, Texas at 7:30 p.m. on the 24th day of April, 1995, which is the time and place tentatively set for the passage of an r ordinance and such other action as may be deemed necessary to authorize the issuance of the City's certificates of obligation, payable from ad valorem taxation and a subordinate pledge of certain revenues of the City's water and sewer system, in the maximum aggregate principal amount of$5,500,000, bearing interest at any rate or rates, not to exceed the maximum interest rate now or hereafter authorized by law, as shall be determined within the discretion of the City Council at the time of issuance and maturing over a period of years not to exceed forty (40) years from the date thereof, for the purpose of evidencing the indebtedness of the City to be incurred (1) for certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Lizer Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Lizer Road; renovations and improvements to Shadybend Drive (including drainage) from Liberty Drive to Misty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West Broadway and O'Day Road, (2) for renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's �. public library located at 3523 Liberty Drive, Pearland, Texas 77581, (3) for the acquisition, construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City-wide storm water drainage plan, and (4) for professional services. r WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this 13th day of March, 1995. .mot t)/gte City Secretary ( Inter m) City of Pearland, Texas r (SEAL) 0212005.01 039513/1045 EXHIBIT B TO RESOLUTION RAUSCHER PIERCE REFSNES,INC. Frank J. lldebrando March 13, 1995 Senior Vice President • FINANCIAL ADVISORY CONTRACT Mayor and City Council City of Pearland Pearland, Texas Dear Council Members: 1. We understand that you desire this agreement from us to perform in the capacity of Financial Advisor for the City of Pearland, Texas (the "City") in connection with the issuance of Certificates of Obligation. 2. By this proposal we offer our professional services and our facilities to assist you in the authorization, issuance, sale and delivery of certificates of obligation (the "Securities"). We are to be compensated by the sale and delivery of such securities in accordance with the fee schedule as Appendix A. 3. We agree to perform the following duties and such other duties as, in our judgment, may be necessary or advisable: a. We will make a study of the debt structure of your City, the trend of its assessed valuation, its taxing power and the present and estimated future taxing requirements. Such plan shall include a maturity schedule and other terms and conditions, such as options of prior payment and the like, as will, in our opinion, result in the issuance of the securities under terms and conditions most advantageous to your City consistent with a minimum effective interest rate. b. We understand that you will retain a firm of recognized municipal bond attorneys, who will prepare the proceedings and advise the steps necessary to be taken in the bond election if necessary, the legal issuance of the securities and the final delivery of the securities and who will issue an opinion approving the legality of the Securities. All services rendered pursuant to this contract will be performed in such manner, and will include assembling and accumulating such financial facts, information and data, as will be necessary or appropriate to obtain the unqualified approving legal opinion of the bond attorneys. The fee of said attorneys will be paid by the City. 1001 Fannin • Suite 700 • IlouNtnn. Ic‘u> 77002 • CI 1)6i1_1170 AJemher N'ru• );t,k Ctnrk ll.'hnnrr le, r c. If it shall be decided to r o der a bond election, we will assemble and transmit to the bond attorneys such data as may be required in the preparation of the necessary petitions, orders, resolutions, notices and certificates; and will assist your governing body in the expeditious handling thereof rd. We will advise you of current bond market conditions, forthcoming bond issues and other general information and economic data which might normally be expected to influence interest rates so that the date for the sale of the Securities, in our opinion, will be favorable. e. We agree to assist in the preparation of an Official Statement or Prospectus, containing official data and other information of the nature and to the extent ordinarily required, all of which we are to furnish in a sufficient number of copies to permit mailing to prospective purchasers. Expenses related to printing and distribution of the Official Statement will be paid by the City. f. We will arrange for the printing of the Securities, with the cost to be paid by the City. 4. We will consult with you on the matter of bond ratings for the proposed issue and when so instructed, will direct the preparation of such information as in our opinion is required for submission to the bond rating agencies. In case it is considered advisable for personal presentation of information to the bond rating agencies, we will be available to accompany those representing the City for such presentation. All costs of any such presentation, including any fees or charges of the rating agencies and the cost of travel by our representative shall be at the expense of the City. 5. We agree to direct and coordinate the entire program of financing herein contemplated and to assume and pay for our own travel within the State of Texas, communication and out-of-pocket expenses incurred. It is specifically understood and agreed, however, that this obligation on our part shall not cover the cost of publication of notices in newspapers, or other publication cost, or the expenses of any litigation. 6. This agreement shall be terminated by the delivery of the Securities covered hereby, or r by the lapse of 24 months from date of your acceptance hereof, whichever shall first occur; however, if the securities have not been so delivered within the period specified, this agreement may be extended by mutual consent. r 7. This proposal is submitted in duplicate and when accepted by you it will constitute the entire agreement between the City and the undersigned for the purposes and considerations herein specified. Respectfully submitted, — RAUSCHER PIERCE REFSNES, INC. By: = v Frank J. Ildebrando Senior Vice President — ACCEPTANCE — ACCEPTED by the City of Pearland on this 13th day of March, 1995. City Manager AFIEST: City Secretary (Interim) — APPENDIX A FEE SCHEDULE IF THE AMOUNT OF SECURITIES ISSUED IS: MORE AND NOT THAN MORE THAN 111E FEE IS $ -0- $ 500,000 $ 5,000(minimum fee) $ 500,000 $ 1,000,000 $ 5,000 plus $5.00 per $1,000 for all over $500,000 — $ 1,000,000 $ 5,000,000 $ 7,500 plus $2.50 per $1,000 for all over $1,000,000 $ 5,000,000 $10,000,000 $17,500 plus $1.25 per $1,000 for all over $5,000,000 $10,000,000 $20,000,000 $23,500 plus $1.00 per $1,000 for all over $10,000,000 $20,000,000 No limit $33,500 plus $0.40 per $1,000 for all over — $20,000,000 HOURLY FEE(Projects unrelated to Bond Issue): • $150/Hour- Senior Professional 100/Hour-Technical Support 75/Hour-Clerical - EXHIBIT C TO RESOLUTION MAYOR, DAY, CALDWELL 1i KEETON, L.L.P 700 LOUISIANA, SUITE 1900 HOUSTON,TEXAS 77002-2778 (7131225-7000 100 CONGRESS AVENUE TELECOPIER(7131225-7047 SUITE 1500 AUSTIN,TEXAS 78701-4042 1512)March 13, 1995 OPIE (512)3 0 TELECOP[ER(512)320-9292 Mayor and City Council City of Pearland, Texas P. O. Box 2068 Pearland, Texas 77588-2068 Re: $5,000,000 City of Pearland, Texas Tax and Revenue Certificates of Obligation, Series 1995 Dear Mayor and Council Members: We are pleased to submit to you a proposed agreement for Mayor, Day, Caldwell & Keeton, L.L.P. ("MDC&K"), Houston, Texas to serve as Bond Counsel with respect to the captioned certificates of obligation (the "Certificates"). When approved by you (the "City"), this letter will become effective and will evidence an agreement between the City and MDC&K. As Bond Counsel, we will prepare, or assist the appropriate City officials and staff in the preparation of, all required legal proceedings and will perform certain other necessary legal work in connection with the City's authorization, issuance and sale of the Certificates. Our services as Bond Counsel will include the following Basic Services, which we will carry out directly or in concert with City officials and staff, as follows: (1) Preparation of the ordinance authorizing the issuance of the Certificates (the "Ordinance") and all other legal instruments which comprise the transcript of legal proceedings pertaining to the authorization, issuance and sale of the Certificates; (2) Attendance at meetings called by the appropriate City officials and staff, to discuss the sizing, timing or sale of the Certificates; (3) Consultation with City officials and staff and the City's financial advisor to review information to be included in the offering documents for the Certificates, but only to the extent •• that such information describes the Certificates, the security therefor, its federal income tax status and our opinion; (4) Preparation and submission of a transcript of legal proceedings pertaining to the issuance of the Certificates to the Attorney General of Texas to obtain an approving opinion; City of Pearland, Texas March 13, 1995 Page 2 (5) Supervision of the printing of the Certificates and the delivery thereof to the purchasers, including, if requested, solicitation of bids from bond printers, to obtain the lowest responsible printing costs for the City; (6) At the closing of the Certificates, delivery of an approving opinion, based on facts and law existing as of its date, generally to the effect that the Certificates have been duly issued, executed and delivered in accordance with the Constitution and laws of the State of Texas, that the Certificates constitute valid and legally binding obligations of the City secured by a lien on and pledge of ad valorem taxes of the City pledged to their payment in the Ordinance (subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws in effect from time to time relating to or affecting the enforcement of rights of creditors of political subdivisions) and that, subject to certain restrictions, interest on the Certificates is excludable from the gross income of the owners thereof for federal income tax purposes under then existing law; provided that, after the closing, we do not undertake, unless specifically engaged by you to do so an Additional Service described below, to provide continuing advice concerning any actions necessary to assure that interest paid on the Certificates will continue to be excludable from gross income for federal income tax purposes; and (7) Prior to and in connection with the closing of the Certificates, giving advice to the City to enable appropriate officials to comply with the arbitrage requirements of the Internal Revenue Code of 1986 as they affect the Certificates, including yield restrictions and rebate requirements. In addition to the foregoing Basic Services, as Bond Counsel, we are prepared to undertake the following Additional Services, as directed by appropriate City officials; (1) Disclosure work or similar services (other than the limited review of certain sections of the offering documents for the Certificates as described in paragraph (3) under Basic Services above) to assist the City or its financial advisor in the preparation of such offering documents, on such basis and to such extent as shall be directed by the appropriate City officials and staff; (2) Attendance at rating agency presentations, investor meetings or other presentations relating to the marketing of the Certificates and consultation with City officials, staff and advisors to develop such presentations; (3) Preparation of "Blue Sky" surveys or securities registration services; (4) Any other special services not ordinarily required in connection with the issuance of obligations of the nature of the Certificates, including services rendered in connection with �. special federal income tax issues, unusual issues arising in connection with the City's financial City of Penland, Texas March 13, 1995 Page 3 r reports or audits, any documentation or related services for credit or liquidity facilities or enhancements or other special structuring techniques or devices to be employed in connection with the issuance of the Certificates; and r (5) After the closing of the Certificates, providing assistance to the City concerning questions and issues that may arise prior to the maturity of the Certificates. For the Basic Services performed for the Certificates, MDC&K will be paid a fee of $7,500. Such fee shall be paid from the proceeds of the sale of the Certificates or from other funds, as the City deems appropriate. Except as otherwise provided below, payment of the fee shall be made after the issuance and delivery of the Certificates and within thirty (30) days after receipt by the City of an approved invoice therefor. The fee for any Additional Services provided by MDC&K will be determined on an �. hourly rate basis, using rates customarily charged by MDC&K to other clients for the same or similar services and taking into consideration the time consumed in providing the services, the level of expertise and ability of the attorneys performing the services and the difficulty and . complexity of the tasks involved. The total fee for Additional Services prior to and in connection with the closing of the Certificates (other than fees for special services as described in paragraph (4) above under Additional Services) will not exceed such amount as is agreed to r in writing by the City. MDC&K will be reimbursed for its reasonable and actual out-of-pocket expenses, such j' as the cost of reproduction of documents, out-of-town travel, long-distance telephone, telecopy and similar expenses, deliveries, filing fees and all items paid for by MDC&K on behalf of the City, incurred in connection with the performance of any services hereunder. All of such expenses will be reasonable. Nothing herein shall be construed as creating any personal liability on the part of any officer of the City, and this agreement may be terminated by the City by giving 30 days' written notice. r r r City of Pearland, Texas March 13, 1995 Page 4 gma If this proposed agreement for the services of MDC&K as Bond Counsel is satisfactory, pleace evidence your acceptance and approval by executing three copies in the space provided below. Very truly yours, r Rick A. Witte APPROVED: ,, Mayor, C t Pearland (Pro-Tern ATTEST: A701/01 1(i—bfAtVe City Secretary, City of Pearland (Interim) r p 0211717 01 0395 1 3/1 049 • s CERTIFICATE FOR RESOLUTION a 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 a regular meeting on the 13th day of March, 1995, at the regular meeting place thereof, within the City, and the roll was called of the duly constituted officers and members of the City Council and the City Secretary, to wit: C.V. Coppinger Mayor D.A. Miller, Jr. Council Member Richard Tetens Council Member Randy K. Weber Council Member Jerry Richardson Council Member David L. Smith Council Member Tommie Jean Vial Interim City Secretary and all of such persons were present, thus constituting a quorum. Whereupon, among other business, the following was transacted at such meeting: a written RESOLUTION AUTHORIZING PUBLICATION OF NOTICE OF INTENTION TO ISSUE CERTIFICATES OF OBLIGATION IN A PRINCIPAL AMOUNT NOT TO EXCEED $5,500,000 FOR THE ACQUISITION, CONSTRUCTION AND IMPROVEMENT OF CERTAIN PUBLIC WORKS, AUTHORIZING DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT RELATING TO SUCH CERTIFICATES AND AUTHORIZING CERTAIN OTHER MATTERS RELATING THERETO (the "Resolution") was duly introduced for the consideration of the City Council and read in full. It was then duly moved and seconded that such Resolution be adopted; and, after due discussion, the motion, carrying with it the adoption of the Resolution, prevailed and carried by the following vote: AYES .Q NOES 2. That a true, full and correct copy of the aforesaid Resolution adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been duly recorded in the City Council's minutes of the meeting; that the above and foregoing paragraph is a true, full and correct excerpt from the City CERTIFICATE_Q'J UBLISHER THE STATE OP TEXAS 1 COUNTY OF GALVESTON I, LINDA KNIGHT, Classified Director of the PEMRTER NEWS, do hereby certify that the PORT,$NEWS is: (i) a newspaper as defined by Chapter 2051.44, Government Code; and (ii) a newspaper of general circulation in the area of the City of Pearland, Texas. L„\Jv\ A KNIG Subscribed and sworn to before me this day of May, 1995, A.D. 4.;y , t � ,• <1 4A , M1.Fr l,/ i • �r11 1 . C,y !, : • 2[t r. . Notary's Printed/Typed Name Commission Expiration Date 434403.01 05)522/1410 AFFIDAVIT OF PUBLICATION REPORTER NEWS P.O. Box 954 Friendswod, Texas 77546 State of Texas County of Galveston I, Linda Knight, hereby certify that the notice hereby appended was published in Galveston County in the RE ORTER NEWS, a newspaper for general circulation in Galveston County and Brazoria County, for issues, as follows: No. / Date �!l� 19 l� No. Date 19 No. Date 19 No. Date 19 No. Date 19 Classified Dir tor Subscribed and sworn to before me this ..23 day of 7/7011-4/ 19 rrr,i„p �,,� a w , LAtJR• • is gel •o` �.� -r• "''••t tary ' . 0;4; tafe o Texas Laura Ann Emmons • V -*asap! el op 101UOIW1J +••'+••r'"', ""f•""" 'suet owns*Ann-swoop -olaw A sauolosAOUSJ AWA IO POP to uiNePibm a6Jsl •Jsplsuoo of pssu ssl :ploy man uyor spec *It HS) noA 6ulyiawos sl *Woo VUIPPW•puslJesd to IJI.y 7�O MHO �Ja o■ fu..ru AN •n slay(fits NA)Awapowe n WSW U10A1060010* u cum 0/4 6ul�uJw situ �wrer rorrovav u' onto el *poop (*wend 6ulpnl0U1)3ssM a t0 uolt . ul ' a- Kamm7Me NH • u n us o l e g s u A (pious* 4R4$a03 Psi Asa 10 1460 031v30-wit 3 N0O 1 SZ l 9ls liar wwieEM MOO -Is opu.Anloul) onto sun 10 uopp}nbos an:al PIIM+N . . .. . .• ,.. op uoloorUisuoo el A osed lOu lnq !MINIM!AND SMi op ayoSJSP sp uolalslnbps el Pgsool sloe(iold Peas ' :::-4., , j s /\'Th''t t. \. \ °\1 "� t , Ill iI •(SE Hs) tasJts uIIM, Mina*Jot(l)PaJJnwl M I J�J(.��J. L !Ilea II Wig plod man of ANO ill 10 MSQalcaPUI laNeeri 'fluor ergo it•poop(opus*1 an Summits 10 *sod pus APO)•eQg•ettr•0oe-1 S3l1 N G'21?!G'M A JIOl O n ?J3ON is opuSAnpu)allgo sun op 1 -ma ayl Jot'loslap IMP all la Dawn%Metepv ma'NIP u0t,onJisuooelA owl .p les4.SSA(OP)AIM Mau ""Id 'PIf10o IPA ApinoJr►o Smof1a1 aNd S2ld^l ammo op uop pinbpe oi el low gala 10 'mad I t0A lap PI POP AKA WV :s.lusinets sot 'swamps J.A°But.nluW WO 00011001 S WOP1 3 dfilni Pus •pu oad opu.Anpui pepMo to own ow re 1pun00 Pe0 %J gI us sspezlleool ells* syl t0 ineePolP ins IMINP Allvl3NYN1A 'DNIA01 oi ago solo.Aad sown.!. PaMtempIs.*4 Nils es' . M a .. �� *i4�1�1*u WaI u tat(l)'PlPnlo II 0PN1 AN OU3MNOY1 � -'mot s 1 �D'�6�IIMtl 7r�M �y sAsy .nb epn.p a Jeloup O 'IMSJ _ •Magus woo`gloat pe woo x. Jo*3u Aue 3+col 3UJstul Sul It 'IM Pall 'P0CSssPUNJd '00U P I $ lout(01.)quaJlno .ptox. ou snb sous .p opo4Jsd •mg'000'009'9i l0 lssiouel '{Weed Allod) 'J0 eelPIv tLt WIZYW t66 L S un WOOS uolownpew A uop lediouijd owSwe6g wnw '100C • VIVS 70vNv0 pus op odwap s ittownw 'IXiW MR W 'WQIAS JSN N WON AVM t Pp1NMleg .. TM_ - olosuo ip o lap uOloo.JO. pug Jsoui 0,A;13 *MI $ ' '1r1Z 6I$poo test _- -- 4. 1.1 *mop opouluus)SP goo WWusA*l 014100 10 SIps d : .1110 'usd Aid%NA'sAol 14(6— •- ••- ' *moo 'Ali Jod opeziiolns 1lsuprosna I Pug uopgsq •aa111WNd g •poonlspusNd _ no op sandosp o wogs ow W*JOIM Pe WOJ1 slgsAsd , '(utnb.or um:) *.or -gnu mom op JOilA N USP 'uo1N61140 to este011I WI P0i1 ire t•wsv i`ig l.oxe ou snb'sofa swolA •J*0 OW Mt t0*oug $S1 )�3dYN :000MS0N3l AJOIIAJ.1nbpnos *wow, a .coAJ s ... v3 J\'v ... so opue6U.A.p`000`00S'S$ sp PSWNP sq AMU OW {MOO uI JIIJqus.JD 90E1 ''w-d ope6.J6s owpntw Ndloupd J1Li)O Lions pus sousupJo Z• 'WI II '9Z OAR 'log pSPRueo sun us popn10 uI t0 .6.snd up Jot wo ''W'd t►• •iro 9 'rg yoJIM -!I ago eoeola A ones sp AM.Alilw•i solid pus owls 'AIPIJA -• 311/1,lDyyvD ,allotele pp.sollgnd mum laget y01LiM 'Sell 'HMV •tea ONYD101211S '7'0 ,Iiiimito sp epusid sun IO Alp MltrZ all Ito 'W sill. d 10 'own! PMonsonO% ,4 JopA un6ss solssndwl Oiit IS Iexal'pillllmsd leH 1a4010 lu•d Vero i`Aluo .ego opliJsd*J *peep Alto to amid 6ullssw al 1.11ldv'wall u0lielissM ` 'Pspu10 of sp uoloe611gO 41801 ON 1010010 610(.413• 'N QZLZ -- Julys °VIA i 11.1.N op ammonia.p UolhWs s43).sxsl'ptwlny p A1IO 'NOW pit ism 011411111 li t jr JIzJJ4rli wad opeasosu ail tO MO11llOO Alp ago 4° `spool)Pi I4Ienoti 'mop ivk uusplsuoo anb Uo100s N3AwD AQ3d3N a IOIL0N s,u*w `SJnIluJnd •UI•d g >a ono le;A szusuapio sun.p •we e'iZ OM'AaPAIS ... 4 *sad II said opeww6old 8311f31.4.11MO3f$$l • gZ 1.JIM 'Aaponlyl awawSAiiewsi Je6n1 A od 01 NOI1N31M r10 30110N •poo*spuong '(•qns gel11 , 'AM a'9661 ago INgs sp►L _ f4'ON NOLLvoflddv euuv) Wed 'agoutis OOS ZA ... . AV il Inp I.'w•d Og:L set I Iasi •MS anNv310 muds . . ^ PeePo.d sp o3UslwqunAs AJsWoaS Arlo WI+W1 9te991t'14nlo II'alum(.P J010601 ono Is pm war Ii wol Hoe 'wswdlnbs *wiax. V.smut(es (.Plpnlo al.) `swell PIOU.snoy •oslw Oriel'Pull and eP P$Pnlo ' •` AO1N ] ANI N00yi sp Iedlolunn ossuoo ago 00 PIsaM se pus Jmdde 'slob tq 'sdwtl 'some; '1a •nb maim 3110i of Alpuniioddo pus MI/ pua'sA.JMOJoIw'Jalsja6lyw NH IAay Maya **Pitt Pe 'nue*p 'PM SN '113A'Al soavouLui30 tdl1JM3 -3s•JMWI nI pewee ire iv '01ggluJn$'*$OS'oil!SS•�'�u-��ra . ' . N0loN3J.Nl 3Q ytotlON 9'�'SC 43JS �' N ,\ rlye ,y t. - A► Ilxsl PUIlJIM 10 40 (P*od>4111110OSC 'ENS IONYI 111l10NA1d 911C , a.:;x was '` � J 11 -OOsg)A.AJnS'eTl'H ago l0 'Iw/3I • (w la^U W0j ZPS $oI.4.4v 'Vet b•I $30.1 P1011a.noy In 6uIMs'sio03 u 1 'spullq `OpusiuIN 'Al`eu *mu, sapolo vim . AIM-0i'AiJ.dojd -14to 0w.is 'sAO) ',mop ploy.snoy 'iuswdlnb. '968 VMS to Asp 143CL sly! `Alt!O 3141 pecHadsop Bu!MoIIO$ ow e1J16 'JIIy34614 'usdAeld 6ulysld 'SZ 43JI11 'IRS ' PAW 19 A0 1Y3S 1 AM O 3Hl 1y6i1Jis01 (l(3) 1 i3lileI0 inPul 113all ''Ndd'a00MSON31dd 'Z yaJIM ' 11. IH 'I t.d HWL- B , I9 31313 aIIPIszeH 'iszeH •ONV ONVH AM SS3N.LIM I1IoJswwo3 uolisoltlsstla 'HotineNta3 fioet LILz•31VS A1IMvtil-MP 1 aoiloN o!Jgnd 1 eonoN oIgnd sales a6eie9 sales abeieD ,yr•, .,,n••, r,•1 � , -.., r + 44iviiiie I dren's clothing 2T-T,misc, of the City's water and ,dlacr.ccion as, L.onesio household&baby Items. sewer system, In the maxi-!Municipal al Hemp°de eml- 1993 MAZDA 323 GARAGE SALE - 2006. mum aggregate principal'Mon Y madurecion sabre un Airline Dr. (Polly Ranch), amount of 85,500,000, bear- period° de anos que no $ Frlendswood.March 25, 11 Ing Interest at any rate or aced* cuarenta (40)arias 14900 am.-4 p.m'No Early Bads. rates, not to exceed the de sea fiche, con fin a cvi- MOMTh r maximum Interest rats now denciar a dauda qua hays K AIVRI lrsssf,Oil YrYt tfisri twR L ' $:°•' ,, by irkurido la Ciudad, i d q.a aria pb tlei .f1,W 1t tMi as t ii --� , or hereafter authorized (1) Pant PI, 1 ,~ , law,es shell be determined algunos proyectos de la LOVING, FINANCIALLY min the discretion of the call. locallzadas en li SECURE Actor/miter, Dad City Council at the time of Chided,,Pw°n6 and full-time Mom seek to issuance end minting wet solamente, los sigulentes: ' RS AND TRUCKS give your child all that you a period of years not to laadquisicion de derscho would It you could.Please exceed forty(ad)years from de peso y la construction 'ER FACTORY WARRANTIES ' cell our Adoption Canter It tire date thereof,for the pur. de urea calls (incluyendo e1 1-800-488,3238.(Cory and Pose of evidencing the fie)diked.►s aUs 4°"14• indebtednese of the cite to User Road haste la calla �) (( (r��{�(` 1 Ill yam) be incurred(t)for certain .rain Street (8H 35); la �� l V���� r 1 tJ�=\.� I street projects located in adquisicion de derecho de. the city Including bat we m t Pa y Is construction de a.:,: ;:4;<..:..; :,: ,•:.: Misted to;the of ins calls (incluyendo el- crone imp en Paw 116,125 '1• 2 CONVENIENTLY COCAIIED right of way and comm. drone), y traba)o in un v�lr�rn In the heart of Pearland. lion of a street(includingPuente) deed. la calle 'E n ORFXDEM. '' "es` TN*charming two bedroomdrainage)from John Lizer Broadway(FM 518)testa IS Fief m.rti.rw a 91radid. cottage is something you Rod to Win street(sti 35); .calls John Liar Road; las need to consider. Large sofiummon of right of wey renovaciones y mejo- closets,four ceiling fans, and colothkeion of a arm ramientos de la intersec= lovely kitchen. Large lot (inciading drainage and I cion de la calla North' PEwith great trees. $48,000 bridge work) from i Hatfield vieja y la calls( ' f MCFARLAND'OR . fig 51a)to John !�Ha w� n y re�l._ ry DEBINE WNW' ERA 'ovations y mejorarnientos' REALTY 485-3295 or pgr. improvements to de las IMersecciones de la 3ZT-2871 ora17.1123. shedymnd Drive(including calls West Broadway, li 3-2-2 CONTEMPORARY, dtabneP)1rom Liberty Drive calls Harkey Road y la call* open concept with formal b way street;renovation ;O'er Road,(2) pars repo-, RAJ '92 CHEW X-CAB are Greet enMrteil• and Improvements to the ;vaciones, mejorami.ntos, $5,757 hi..Show*/7117A $15,489 Mg home with appetite interovcgon of Way pito I met riales, surtidos,equipo '94 CHEW SPORTS1DE Indoor room,flagstone Soar onoM�asn Rood; maw- Y maquinartas Para clertos $6,987 vs,kw,only m a►wan.rn $16,303 with Jacuzzi tub and wet tlons and improvenente to edfklos y faciidades di is )1 '94 FORD F-150 bar, overlooking full size the intersection of old and Ciudad incluyando p.r°no "'1.• $7,371 X!T•Sale.Await $16,479 1 and lush landscaadamant.la biblkrtea pub• '93 CHEW S-BLAZER pool pe' new North Hatfield Roads; Ciudad IocaUzado .•s $8,979 ukuno..vsrsww $16,661 990s,to view, call RETTA and renovations and il 3523 Liberty Drive, CAB '94 CHEW FLEETSIDE ABSHER/AGENT eves 445- improvements of the inter- $10,581 A ..as wheal..sans $16,879 �pgr�- sections of West Broadway Pearland, Texas 77581,(� y Road West la dquislcion, construc- '93 FORD EXPLORER XLT ij� ° , rejaremlento, S 10,943 m Limbo.wens $17,879 y> Broedwey and O'Day Road, don, ...,. . .,... cion, materials, surtidos, '93 CHEW X-CAB (2) for renovations, . $12,289 Samm%ComMINA $17,899 NOTICE OF A JOINT PUB- Improvements, materials, equip° y maqulnarla pars '94 CHEW SPORTSIDE UC HEARING OF THE CfTY supplies, equipment end ciertas facllidades drenaje '$12,876 Rooneyosns.,wsn $18,641 p locaiizados en la Ciudad, '93 CHEW SUBURBAN COUNCIL AND THE PLAN- machinery for certain City Inciuysndo, peso no cola+ $12,899 l�.e a ans.lo.d. SUMM $22,971 MISSIONNINt AND ZONING CON• buildings and facilities mente; mejoramientos de DE '94 CHEW SUBURBAN OF THE CITY OF including but not miltedtD controlar la inundation ea $12,949 ow NC.*weft.MIA $25,861 PEARui�TEXAS the City's public library locelizedo el sus de Is sui? located at 3523 Liberty division de South Cort$gan;` I Notice Is hereby given that Drive, Pearland, Texas 'la Hickory Regional SE N A 3 L A FAST, F R.E t�O[X on the 10th day of April, 77581,(3)for the acquisi- ESPAt(OL SERVICE 1996,at 7:00 p.m.,th.City neon,construction, Improve- �nti0nlizndo el de Council and the Planning mint,repair,materials,w de la subdivision de Tw(n and Zoning Commission of piles, equipment and don un d'art d d the City of Pearland, machinery for certain don de un de drereji Brazoria and Morris drainage facilities located In 'cis ague de una torments //g/iiii I e;,ai pars la Ciudad enters,y (4) J'%. Counties,Texas,will con- the City Including but not pars a Ciudad enter', profe ion- . ,ET,SMAK .y;f, duct a Joint Public Hearing limited to: flood control skis in the Council Chambers, Improvements south of the 8525 r2y� � City Hall,3519 Liberty Drive, South Corrigan subdivision; TESTIGUE MI NANO Y LA L�"w�desl Pearland, Texas, on the the Hickory Regional ]dared request of Robert I. Ellis, Detention located south of SELLA DE LA CIUDAD,este Jr., owner,for an amend- the Twin Creek Woods sub- 13 dla d.Margo,1995. , mint to the Land Use and division;and formulation of• Tommie Jean Vial Urban Development a City-wide storm water Secretarla de le Ciudad _ fi <, .:€; Ordinance of said City from drainage plan, and (4) for (Interim) . >; . .1, ,. ,.:..: ;:i a' professional services. ; . � Ciudad de Pearland,Texas CI&D CARE IN my home. Ii N.r � Springfield subdivision. For WILIOWCRESTI Pretty g Lan. l,j 8.1 8llrellr I 1 AFFIDAVIT OF PUBLICATION REPORTER NEWS P.O. Box 954 Friendswod, Texas 77546 State of Texas County of Galveston I, Linda Knight, hereby certify that the notice hereby appended was published in Galveston County in the RRPORTER NEWS, a newspaper for general circulation in Galveston County and Brazoria County, for issues, as follows: No. / Date 944/r/ 421 19 No. Date 19 No. Date 19 No. Date 19 No. Date 19 Classified Dir tor Subscribed and sworn to before me this 20 day of 19 9r.41 'i -ws� c .�0 • !;/ • h . - ., State exas Laura Ann Emmons $7.50eds for 1 Reel Estate Reel Estate [ Real Estate J Real Estate NORTH AMERICAN MORT. �.r � . 20 Words or Less 485 7501 GAGE COMPANY 'purc'Purchases 'RNinaos .�! AI ® 10c for each additional word 'pr..Approvals Call Lill '1104\ WAI( , WIIktN,17171 fee-!e!S aotkt .:,.. ,.. 42. D,,m..tS., _ ides 1 , Motor Vehicles + f Motor Vt 1 Motor Vihkies „ _,.,R•, �.•.••. -• . .,_.,, ` J Motor VMINei »a...,..114 P.,. -,4141 Retta Absher � ' s.i.,♦.,Ot all -. b ROM $1 .5 MILLION INVENTORY ;+;"h.W,r`•,a77 Sttdi'.t,?t?P. r9987PO1 ®MIS lD PRICE IS A PRICE u��' . . . _ ' on 1.25 se., Saarland 3.2- ��Ldvaly one mum In Nodes. S•2.2 Or. Apartw.nt In xlgOM Owrlw .runs bask Rod a spa gam• don arasbutdon improv. . .a flppded. Must Ne t0 i M M12 elm am bif naarrL repay,Rna'ternate,•P- EEL GOODABOUT" ORbe MACE DEggY 141.1111. r Anna.Must it plies, agwpmsm and OR MACAW Y5 ap9obMr.srK Cat now macmn.ry for tartan.ERA REALTY 4S6-S21s or Orroniftot Ye 4s6.12/S. Minims facilities acrid In 22gun7.1<71 or517•tt22. • w p. Ma City including out raw In" In'a• Laeat peke in anbdMNon limited to:flood control when they buy a new Chevrolet,but we go way beyond that.When e1y°'arse°M1 nice and ewer.,•pill rloo< Improvnenu ,d ar fits of l 6N a plan, leadedty, n cp a Cor re going to have a good experience,and when you(aloe bock that / open poor leaded „ a soot the Hickory Raglonal a i. , glass doors,Iseiui tub ;row and grow.' ` iegn,,M,rr snow..•ones Comore earn a.ca and rage Iocnw soutlt d C.L.STRICKLAND p, f DEW HESETTT ,w yard w/2 favN related aft Ta.n CraM wood.Sao YAOGE YCPA10.AIp ERA gmdsfs.Cass todpl RETTA *Nsbn:tend�tbn d ` a REALTY ISF225s or espy ASSNER/agtnt,Pg.an- a Clty-wide storm water Pi are ' "c PROGRAM CARS 2r�„a„'„ dr.inageplan,and(4)fer 7457108WN 31-1r2-t. • • custom IrWees"isrncit suidmeign. r - 1pwhamsM � rq. WITNESS MY HAND AND V THE arr. nue SEAL OF Oskar 0�Dart WIN workarap wMn else• THE CITY.tines t 2al oily d bey MF q on 112 are melt Marta NNW _ �1'����s. his � O.IP°nb beautiful pecan testes for ' �` /,_i` awing and inn.Include him.►rkw b NW(Mot. .__ma tbrsga bldg q Tarmac Ilan(b ' ."' _,_ e: «' 1s7.000.RETTA ASSNER/ �j✓��, — ail bnm wmrtlq.nETTA AQIRT NH7a2 anti.or (btirkn) ,✓ jai , AlSHER/agtot.pg.SSS• aia pi„ 7s07. cave*, d Pear1arKL Tasat SCORT LX 1993 CAVALIER RS 19935 IMAZDA 323 - WIU,OwcRE~iTI Pretty oo mama alrtmCERTSICA000 100 $79 9 3 m nr o.m.F.d not wort pars,pmtie pha a 6 9 9 3 f a�Yagnal4 the sOY. DOROTHY TONE NOTICIA N. md.Tll Des..No PINE Some fare STALL REALTORS,4111• Canaille Municipal de la .,.,i t r:.o hem a...AC,Mx I►sw uw.am(chew L am Mend a..t(aays k m aaa na..c r 44.0.11811.8 a MUM tan"I Ail asps ow. gutted de Panarnd.Tens -v.fa n4s%Are Cram et Want)+...tap Sea ► boa Om rab tiaadiw. and an Inclosed porch ('Is Ciudad')se Notre an stress th back.DEl6.E ' Ptak el eft regular de helm el IEI M MA REALTY 4s6• sywsssminto de Pemtand, .EAGE PROGRAM CARS AND TRUCKS '2" vi. 80NOTIM CE�(oof INTENT T6 ;me a SUEOFVISION-Price•lust po y sugar t•ntathamente CAR FINANCING • STILL UNDER FACTORY WARRANTIES AMA/MOLooking for a Thls I.to give notice of programsa°pars al Pisan ham with lots of rooatT Mein to introduce In the Ida ma ordsne m y tar aba r This 4r22 Mop tom met 74th Legislature,Regular action qua considered long tiring room la randy lassos,a MS to be welded nee.aarlo pars subrlar b 14 DOOR '94 CHEVY CAVALIERS :ofCli yq de Ciudad,rocantDrain� obligation ecapiM ie easalWty b see Olswkt N:the powers and j elando r.partfdo cis .m erything available 4 AVAILABLE a antes.MAGGE NICPAR- duties of the district;the lmpwstos Begun valor y LAND ERA REALTY mfg. election,terms and tom- urea prends d• clefts* n New S16,125 I=lot pp¢¢.617.1123. p•nsatlon of district coot- raves arnicaarnicadesla sms MHO,/t7L RAPE{J__ -11,495 .144 ,to IBANBURY CROSSm•past missfors and filling de aqua y clone de la =GREAT '9997 �a' °°°'L pricedie w re In die nod positions on the muna Ciudad en ctldad .s ' ' MC INES� Gnat loo.Non for a try to Mt board of commission- principal maxim prpado r. ills malts or downtown) arm;and Oilmanthe narr. do S5.500.000,dtvagndo This 9*3.R.game room Of ter owlet' Wane a cuelpuisr valor 0 CAR CENTER SPECIALS r Your e a sow MOOSE MCFARLAID ERA .IIOTICE is Ho my GIVEN I autorindo per lay,como MS REALTY 41111.12111 or pgr ass ale ply CDstell of as WI d•terminado demo l '93 CHEVY CORSICA gr PLYMOUTN CARAVAN 91 CHEVY SUBURBAN s17.1125 !distraction del Conti o S489 w...a car.roc mos $8991 ,Na o.rile $2989 sa...m Or arc rise $10,675 CS r are Saarland Teas Car 1 '92 EAGLE TALON 90 SUZI�SAMARAI 92 CREW XCAB PUMIXIMIMMU • amyl us m it a es rep. *Nit r al bulpo Os wtw S875 tuns sows=IA $8977 r.a.,s u.wait mat s4972 ,.tot sum.u.n S10,984 S)EAITTtfiJ<moms an CMS In mating pine at City eon y msdn.aebn sobs un '94 BUICK SKYLARK 91 FORD RANGER XLT 92.EEP CIEROREE land.4 I-1f2 Two yew. Hag P.srard Tssost 710 p•rfodo a areas gale no $945 w..4cs,...no $10,976 .a.agtm. 96846 t..tr.•L...anal $14,687 oN brd.00dlbars grown p.m.on the 24th day of sued*maracas leg)also. '93 SATURN SU Ti9 FORD BRONCO N '94 GS(C C1500 mow!.NIb.dne.r W. APrll,INN,which Is the d.ass fact.•nor tin a s0F S985 4 o.s 4c.Gra,, $11,897 a..at maim $6948 Ina noo......tea $14,876 with bonbon treating. eras tend plan t•mathNy Mira:a deuce qua hays net for tine p.aaaq•of an'93 PONTIAC GRAND Mrs 91 GMC SONOMA 93 CHEW SPORTSIOE PTO 1onMh decorsesd. ��r Cludeo•(1)Pa 2979 woo,44.1..ana.r $11,947 C^.sea ens.ma $6993 as..mwwra 814,991 $1S2,500.Cd1184716 Opines ro sctos de la wows.and such otter 9 D Y a. 3989 wrovarnaw la .Sw> .11,979 r.*a Pro. $8p4 Asa*.OfVY 10� $15,961 CIOUS,owerstsd bl!114- eetlon w nay be deemhe calls !ocdltache•�.ro Inso.esary b authorize the '94 CHEW EUROSPORT 19 FORD XCAi '93 FORD EXPLORER 24441 on paw pat new- imam et ar awe osr- Selsnent•,Ise.Ig.tOnM: 6999 co.a.w.ioaea ma, 812,989 ar,aa►om ram. sips ...ul..rtwatt 916,977 fay daps awn room an tNkatn* of obligation, Is arqulafcbn de duNtto 94 FORO TAURUS GL '92 SUZUKI SAAIARAJ 94 FORD AEROSTAR XLT$16 be mpn is pram wows mod- wow from.a vainrtw la peso y construction 7489 am r crl saw 812,998 aa.>ta.ae.rout sp7e ar rat tea wags 977 MI entrance,Iry Indoor tendon and a eabordrrb de..r all.(„cinMwrsdc II 94 CHEVY CAPRICE 90 CHEVY SUBURBAN 94 CHEVY XCAB Y illy,"Rd Milan,ITd at NNW revenuer 16Jarrls)dads a aaa,loin ... 7979 ...a.r.....wnn $14,979 ow*4 shwa,owe UM es.e.. XCAB 917,1174 1�9• grebe oe '33 FORD 93 CREW CUSTOM XCAB arb0ka NO Ind. of trio Ctty's water and Um Road nests la clef* '93 NM PARK 8987 M.tt.aialOwA�' Si6,677 netaam RANGER $9879 sm...raa.a..rt.a $17,987 rapt and pool)ero Vein Strut ISN 76); IIrage MOW Wank in du mid- - building,home warranty, mum aggregate principal sdqufakan a darsetw a .and suet more.Cal Rees awes.or 65A00.000.ter Peso 1 ls connnKtfortM 71:U I r,: AbsMriA ent, runs calls(Ineluyendo al Uf.lt!(f It"•'.t Dl:,ff ,,,....J `,f H,;31. 14%1.181111/81 g egg qs• In,Interest K any rocs a IMO f llLlpllq(, f1lIIVF HY P:.Y'1f JJ1S E`,{',if1UI SFRVIQ 7102...a*uo.411.- 03. stet,trot to Meld Ha denial•y treM10 an ahn madam rarest rob now point.) dada Ill ells Nog commaM Fish on or ien alb t r auortred by "Id",fFM SIP .ab l la R ells mabel Traci.24.2A(L bar.are ail be dabs fined I calls,holm Lieu Road;lsa Flrsolse•In den Intercom w1NIn the Marlon of the ;ranovselonss y mslo• CERTIFICATE FOR ORDINANCE r 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: r 1. The City Council of the City convened in regular meeting on April 24, 1995, at the regular meeting place thereof, within the City, and the roll was called of the duly constituted officers and members of the City Council, to wit: Vacant Mayor David L. Smith, Jr. Council Member, Mayor Pro Tem D.A. Miller, Jr. Council Member Richard Tetens Council Member Randy K. Weber Council Member Jerry Richardson Council Member Tommie Jean Vial Interim City Secretary and all of such persons were present, thus constituting a quorum. Whereupon, among other business, the following was r transacted at said meeting: a written ORDINANCE AUTHORIZING AND ORDERING THE ISSUANCE OF CITY OF PEARLAND, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 1995; PRESCRIBING THE TERMS AND FORM THEREOF; PROVIDING FOR THE PAYMENT OF THE PRINCIPAL THEREOF AND INTEREST THEREON; AWARDING THE SALE THEREOF; AUTHORIZING THE PREPARATION AND DISTRIBUTION OF AN OFFICIAL STATEMENT TO BE USED IN CONNECTION WITH THE SALE OF THE CERTIFICATES; MAKING OTHER PROVISIONS REGARDING SUCH CERTIFICATES, INCLUDING USE OF THE PROCEEDS THEREOF, AND MATTERS INCIDENT THERETO; AND DECLARING AN EMERGENCY p (the "Ordinance") was duly introduced for the consideration of the City Council and read in full. It was then duly moved and seconded that the Ordinance be adopted; and, after due discussion, such motion, carrying with it the adoption of the r Ordinance, prevailed and carried by the following vote: AYES: Q NAYS: • 2. That a true, full and correct copy of the Ordinance adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; that the Ordinance has been duly recorded in the City — Council's minutes of such meeting; that the above and foregoing paragraph is a true, full and correct excerpt from the City Council's minutes of such meeting pertaining to the adoption of the Ordinance; that the persons named in the above and foregoing paragraph are the duly chosen, qualified and acting officers and members of the City Council as indicated — therein; that each of the officers and members of the City Council was duly and sufficiently notified officially and personally, in advance, of the date, hour, place and subject of the aforesaid meeting, and that the Ordinance would be introduced and considered for adoption at such meeting, and each of such officers and members consented, in advance, to the holding of such meeting for such purpose; that such meeting was open to the public as required by law; and that public notice of the date, hour, place and subject of such meeting was given as required by the Open Meetings Law, Chapter 551, Texas Government Code. SIGNED AND SEALED this April 24 , 1995. Ci y Secretary CITY OF PEARLAND, TEXAS r (SEAL) r r r 0216086.01 049521/1416 2 ORDINANCE NO. 689 AN ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF PEARLAND,TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 1995; PRESCRIBING THE TERMS AND FORM THEREOF; PROVIDING FOR THE PAYMENT OF THE PRINCIPAL THEREOF AND INTEREST THEREON; AWARDING THE SALE THEREOF; AUTHORIZING THE PREPARATION AND DISTRIBUTION OF AN OFFICIAL STATEMENT TO BE USED IN CONNECTION WITH THE SALE OF THE CERTIFICATES; MAKING OTHER PROVISIONS REGARDING SUCH CERTIFICATES, INCLUDING USE OF THE PROCEEDS THEREOF, AND MA TIERS IRS INCIDENT THERETO; AND DECLARING AN EMERGENCY BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PEARLAND: ARTICLE I FINDINGS AND DETERMINATIONS Section 1.1: Findings and Determinations. The City Council hereby officially finds and determines that: (a) The City of Pearland, Texas (the "City"), acting through its City Council, is authorized pursuant to and in accordance with the provisions of Texas Local Government Code, Chapter 271, Subchapter C, as amended (the "Act"), to issue certificates of obligation to provide all or part of the funds to pay contractual obligations to be incurred for (i) certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Lizer Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Lizer Road; renovations and improvements to Shadybend Drive (including drainage) from Liberty Drive to Misty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West Broadway and O'Day Road, (ii) renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's public library located at 3523 Liberty Drive, Pearland, Texas 77581 and (iii) the acquisition,construction, improvement, repair, materials, supplies,equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; 1 the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City-wide storm water drainage plan, and (iv) for the payment of costs of issuance of such certificates of obligation and other professional services related thereto. (b) The City Council authorized the publication of a notice of intention to issue Combination Tax and Revenue Certificates of Obligation, Series 1995 (the "Certificates") to the effect that the City Council was tentatively scheduled to r meet at 7:30 p.m. on April 24, 1995 at its regular meeting place to adopt an ordinance authorizing the issuance of the Certificates to be payable from (i) an ad valorem tax levied, within the limits prescribed by law, on the taxable property located within the City, and (ii) the revenues to be derived from the City's waterworks and sanitary sewer system (the "System") after the payment r of all operation and maintenance expenses thereof (the "Net Revenues") in an amount not to exceed $10,000, to the extent that ad valorem taxes are ever insufficient or unavailable for such purposes, provided that the pledge of Net Revenues is and shall be junior and subordinate in all respects to the pledge of Net Revenues to the payment of any obligation of the City, whether authorized heretofore or hereafter, which the City designates as having a pledge senior to the pledge of the Net Revenues to the payment of the Certificates. (c) Such notice was published at the times and in the manner required by the Act. (d) No petition signed by at least five percent (5%) of the qualified voters of the City has been filed with or presented to any official of the City protesting the issuance of such Certificates on or before April 24, 1995, or the date of passage of this Ordinance. (e) The City has determined that it is in the best interests of the City and that it is otherwise desirable to issue the Certificates to provide all or part of the funds to pay contractual obligations to be incurred for the purposes authorized by the Act. F ARTICLE II DEFINITIONS AND INTERPRETATIONS Section 2.1: Definitions. As used herein, the following terms shall have the meanings specified, unless the context clearly indicates otherwise: r "Act" shall mean Texas Local Government Code, Chapter 271, Subchapter C, as amended. "Attorney General" shall mean the Attorney General of the State of Texas. 2 "Certificate" or "Certificates" shall mean any or all of the City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995, authorized by this Ordinance. "City" shall mean the City of Pearland, Texas and, where appropriate, its City Council. "City Council" shall mean the governing body of the City. "Code" shall mean the Internal Revenue Code of 1986, as amended. "Comptroller" shall mean the Comptroller of Public Accounts of the State of Texas. "Fiscal Year" shall mean the City's then designated fiscal year, which currently is the twelve-month period beginning on the first day of October of a calendar year and ending on the last day of September of the next succeeding calendar year and each such period may be designated with the number of the calendar year in which such period ends. "Interest Payment Date," when used in connection with any Certificate, shall mean March 1, 1996, and each September 1 and March 1 thereafter until maturity or earlier redemption of such Certificate. "Issuance Date" shall mean the date on which the Certificates are delivered to and paid for by the Purchaser. "Ordinance" shall mean this Ordinance and all amendments hereof and supplements hereto. "Outstanding", when used with reference to the Certificates, shall mean, as of a particular date, all Certificates theretofore and thereupon delivered pursuant to this Ordinance except: (a) any Certificates canceled by or on behalf of the City at or before such date; (b) any Certificates defeased pursuant to the defeasance provisions of this Ordinance or otherwise defeased as permitted by applicable law; and (c) any Certificates in lieu of or in substitution for which a replacement Certificate shall have been delivered pursuant to this Ordinance. "Paying Agent/Registrar" shall mean Texas Commerce Bank National Association, Houston, Texas, and its successors in that capacity. "Purchaser" shall mean the entity or entities specified in Section 7.1 hereof. "Record Date" shall mean the close of business on the fifteenth day of the calendar month immediately preceding the applicable Interest Payment Date. 3 "Register" shall mean the registration books for the Certificates kept by the Paying Agent/Registrar in which are maintained the names and addresses of, and the principal amounts registered to, each Registered Owner of Certificates. "Registered Owner" shall mean the person or entity in whose name any Certificate is registered in the Register. Section 2.2: Interpretations. All terms defined 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 sections 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 provisions hereof shall be liberally construed to effectuate the purposes set forth herein and to sustain the validity of the Certificates and the validity of the levy of ad valorem taxes to pay the principal of and interest on the Certificates. ARTICLE III TERMS OF THE CERTIFICATES Section 3.1: Amount. Purpose and Authorization. (a) The Certificates shall be issued in fully registered form, without coupons, under and pursuant to the authority of the Act in the total authorized aggregate principal amount of FIVE MILLION AND NO/100 DOLLARS ($5,000,000) for the purpose of providing all or part of the funds to pay contractual obligations to be incurred for (i) certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Lizer Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Lizer Road; renovations and improvements to Shadybend Drive (including drainage) from Liberty Drive to Misty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West Broadway and O'Day Road, (ii) renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's public library located at 3523 Liberty Drive, Pearland, Texas 77581 and (iii) the acquisition, construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City-wide storm water drainage plan. Proceeds of the Certificates also will be used to pay costs of issuance of the Certificates and other professional services related thereto. 4 Section 3.2 : Designation. Date and Interest Payment Dates. The Certificates shall be designated as the "City of Pearland, Texas Combination Tax and Revenue Certificates of f Obligation, Series 1995," and shall be dated May 1, 1995. The Certificates shall bear interest at the rates set forth in Section 3.3 below, from the later of May 1, 1995 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, payable on March 1, 1996, and each September 1 and March 1 thereafter until maturity or earlier redemption. If interest on any Certificate is not paid on any Interest Payment Date and continues unpaid for thirty (30) days thereafter, the Paying Agent/Registrar shall establish a new record date for the payment of such interest, to be known as a Special Record Date. The Paying Agent/Registrar shall establish a Special Record Date when funds to make such interest payment are received from or on behalf of the City. Such Special Record Date shall be fifteen (15) days prior to the date fixed for payment of such past due interest, and notice of the date of payment and the Special Record Date shall be sent by United States mail, first class, postage prepaid, not later than five (5) days prior to the Special Record Date, to each affected Registered Owner as of the close of business on the day prior to mailing of such notice. Section 3.3: Numbers.Denomination.Interest Rates and Maturities. (a) The Certificates shall be initially 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 Certificates shall mature on March 1 in each of the years and in the amounts set out in such schedule. Certificates delivered in transfer of or in exchange for other Certificates shall be numbered in order of their authentication by the Paying Agent/Registrar, shall be in the denomination of$5,000 or integral multiples thereof and shall mature on the same date and bear interest at the same rate as the Certificate or Certificates in lieu of which they are delivered. Certificate Year of Principal Interest Number Maturity Amount Rate R-1 1997 $130,000 7.00% R-2 1998 140,000 7.00 R-3 1999 150,000 7.00 R-4 2000 155,000 7.00 R-5 2001 165,000 7.00 / R-6 2002 175,000 7.00 R-7 2003 185,000 7.00 R-8 2004 200,000 7.00 R-9 2005 210,000 5.20 R-10 2006 225,000 5.10 R-11 2007 240,000 5.20 R-12 2008 255,000 5.30 R-13 2009 270,000 5.40 r R-14 2010 500,000 5.50 5 r r Certificate Year of Principal Interest Number Maturity Amount Rate R-15 2011 500,000 5.60 R-16 2012 500,000 5.70 R-17 2013 500,000 5.80 R-18 2014 500,000 5.00 Section 3.4: Redemption Prior to Maturity. (a) Optional Redemption. The Certificates maturing on and after March 1, 2006 are subject to redemption prior to maturity, at the option of the City, in whole or in part, on March 1, 2005, or any date thereafter, at par plus accrued interest to the date fixed for redemption. (b) Certificates may be redeemed in part only in integral multiples of $5,000. If a Certificate subject to redemption is in a denomination larger than $5,000, a portion of such Certificate may be redeemed, but only in integral multiples of$5,000. In selecting portions of Certificates for redemption, each Certificate shall be treated as representing that number of Certificates of $5,000 denomination which is obtained by dividing the principal amount of such Certificate by $5,000. Upon presentation and surrender of any Certificate for redemption in part, the Paying Agent/Registrar, in accordance with the provisions of this Ordinance, shall authenticate and deliver in exchange therefor a Certificate or Certificates of like maturity and interest rate in an aggregate principal amount equal to the unredeemed portion of the Certificate so surrendered. (c) Notice of any redemption, identifying the Certificates or portions thereof to be redeemed, shall be sent by United States mail, first class, postage prepaid, to the Registered Owners thereof at their addresses as shown on the Register, not less than thirty (30) days before the date fixed for such redemption. By the date fixed for redemption, due provision shall be made with the Paying Agent/Registrar for the payment of the redemption price of the Certificates called for redemption. If such notice of redemption is given, and if due provision for such payment is made, all as provided above, the Certificates which are to be so redeemed thereby automatically shall be redeemed prior to their scheduled maturities, they shall not bear interest •- after the date fixed for redemption, and they shall not be regarded as being Outstanding except for the purpose of being paid with the funds so provided for such payment. Section 3.5: Manner of Payment. Characteristics. Execution and Authentication. The Paying Agent/Registrar is hereby appointed the paying agent for the Certificates. The Certificates shall be payable, shall have the characteristics and shall be executed, sealed, registered and authenticated, all as provided and in the manner indicated in the FORM OF CERTIFICATES set forth in Article IV of this Ordinance. If any officer of the City whose manual or facsimile signature shall appear on the Certificates shall cease to be such officer before the authentication of the Certificates or before the delivery of the Certificates, such manual or facsimile signature shall nevertheless be valid and sufficient for all purposes as if such officer had remained in such office. 6 The approving legal opinion of Mayor, Day, Caldwell & Keeton, L.L.P., Houston, Texas, Bond Counsel, may be printed on the back of the Certificates over the certification of the Interim City Secretary, which may be executed in facsimile. CUSIP numbers also may be printed on the Certificates, but errors or omissions in the printing of either the opinion or the numbers shall have no effect on the validity of the Certificates. Section 3.6: Authentication. Except for the Certificates to be initially issued, which need not be authenticated by the Registrar, only such Certificates as shall bear thereon a certificate of authentication, substantially in the form provided in Article IV of this Ordinance, manually executed by an authorized representative of the Paying Agent/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 Certificate so authenticated was delivered by the Paying Agent/Registrar hereunder. Section 3.7: Ownership. The City, the Paying Agent/Registrar and any other person may treat the person in whose name any Certificate is registered as the absolute owner of such Certificate for the purpose of making and receiving payment of the principal thereof and interest 7 thereon and for all other purposes, whether or not such Certificate is overdue, and neither the City nor the Paying Agent/Registrar shall be bound by any notice or knowledge to the contrary. All payments made to the person deemed to be the Registered Owner of any Certificate in accordance with this Section shall be valid and effective and shall discharge the liability of the City and the Paying Agent/Registrar upon such Certificate to the extent of the sums paid. Section 3.8: Registration.Transfer and Exchange. The Paying Agent/Registrar is hereby appointed the registrar for the Certificates. So long as any Certificate remains Outstanding, the Paying Agent/Registrar shall keep the Register at the City Administrator's office in which, 4 subject to such reasonable regulations as it may prescribe, the Paying Agent/Registrar shall provide for the registration and transfer of the Certificates in accordance with the terms of this .•. Ordinance. Each Certificate shall be transferable only upon the presentation and surrender thereof at the principal corporate trust office of the Paying Agent/Registrar, accompanied by an assignment duly executed by the Registered Owner or his authorized representative in form satisfactory to the Paying Agent/Registrar. Upon due presentation of any Certificate for transfer, the Paying Agent/Registrar shall authenticate and deliver in exchange therefor, within seventy-two (72) hours after such presentation, a new Certificate or Certificates, 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 Certificate or Certificates so presented and surrendered. All Certificates shall be exchangeable upon the presentation and surrender thereof at the principal corporate trust office of the Paying Agent/Registrar for a Certificate or Certificates, maturity and interest rate and in any authorized denomination, in an aggregate principal amount equal to the unpaid principal amount of the Certificate or Certificates presented for exchange. 7 The Paying Agent/Registrar shall be and is hereby authorized to authenticate and deliver exchange Certificates in accordance with the provisions of this Section. Each Certificate delivered by the Paying Agent/Registrar in accordance with this Section shall be entitled to the benefits and security of this Ordinance to the same extent as the Certificate or Certificates in lieu of which such Certificate is delivered. All Certificates issued in transfer or exchange shall be delivered to the Registered Owners thereof at the principal corporate trust office of the Paying Agent/Registrar or sent by United States mail, first class, postage prepaid. The City or the Paying Agent/Registrar may require the Registered Owner of any Certificate 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 Certificate. Any fee or charge of the Paying Agent/Registrar for such transfer or exchange shall be paid by the City. The Paying Agent/Registrar shall not be required to transfer or exchange any Certificate called for redemption in whole or in part during the forty-five (45) day period immediately prior to the date fixed for redemption; provided, however, that this restriction shall not apply to the transfer or exchange by the Registered Owner of the unredeemed portion of a Certificate called for redemption in part. Section 3.9: Replacement Certificates. Upon the presentation and surrender to the Paying Agent/Registrar of a damaged or mutilated Certificate, the Paying Agent/Registrar shall authenticate and deliver in exchange therefor a replacement Certificate, of the same maturity, interest rate and principal amount, bearing a number not contemporaneously outstanding. The City or the Paying Agent/Registrar may require the Registered Owner of such Certificate to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith and any other expenses connected therewith, including the fees and expenses of the Paying Agent/Registrar and the City. If any Certificate is lost, apparently destroyed or wrongfully taken, the City, pursuant to the applicable laws of the State of Texas and ordinances of the City, and in the absence of notice or knowledge that such Certificate has been acquired by a bona fide purchaser, shall execute, and the Paying Agent/Registrar shall authenticate and deliver, a replacement Certificate of the same maturity, interest rate and principal amount, bearing a number not contemporaneously outstanding, provided that the Registered Owner thereof shall have: (a) furnished to the City and the Paying Agent/Registrar satisfactory evidence of the ownership of and the circumstances of the loss, destruction or theft of such Certificate; (b) furnished such security or indemnity as may be required by the Paying Agent/Registrar and the City to save and hold them harmless; 8 a (c) paid all expenses and charges in connection therewith, including, but not limited to, printing costs, legal fees, fees of the Paying Agent/Registrar ` and any tax or other governmental charge that may be imposed; and (d) met any other reasonable requirements of the City and the Paying Agent/Registrar. If, after the delivery of such replacement Certificate, a bona fide purchaser of the original Certificate in lieu of which such replacement Certificate was issued presents for payment such original Certificate, the City and the Paying Agent/Registrar shall be entitled to recover such replacement Certificate from the person to whom it was delivered or any person taldng therefrom, except a bona fide purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by the City or the Paying Agent/Registrar in connection therewith. If any such mutilated, lost, apparently destroyed or wrongfully taken Certificate has become or is about to become due and payable, the City in its discretion may, instead of issuing a replacement Certificate, authorize the Paying Agent/Registrar to pay such Certificate. Each replacement Certificate delivered in accordance with this Section shall be entitled to the benefits and security of this Ordinance to the same extent as the Certificate or Certificates in lieu of which such replacement Certificate is delivered. Section 3.10: Cancellation. All Certificates paid or redeemed in accordance with this Ordinance, and all Certificates in lieu of which exchange Certificates or replacement Certificates are authenticated and delivered in accordance herewith, shall be canceled and destroyed upon the making of proper records regarding such payment or redemption. The Paying Agent/Registrar shall periodically furnish the City with certificates of destruction of such Certificates. ARTICLE IV FORM OF CERTIFICATES The Certificates, including the Form of Comptroller's Registration Certificate, Form of Paying Agent/Registrar Authentication Certificate and Form of Assignment, shall be in substantially the following forms, with such omissions, insertions and variations as may be necessary or desirable, and not prohibited by this Ordinance: 9 [FRONT OF CERTIFICATE] UNITED STATES OF AMERICA STATE OF TEXAS CITY OF PEARLAND, TEXAS NUMBER DENOMINATION R- COMBINATION TAX AND REVENUE $ REGISTERED CERTIFICATE OF OBLIGATION REGISTERED SERIES 1995 INTEREST RATE: ISSUE DATE: MATURITY DATE: CUSIP: May 1, 1995 March 1, REGISTERED OWNER: PRINCIPAL AMOUNT: DOLLARS THE CITY OF PEARLAND, TEXAS, a municipal corporation of the State of Texas (the "City"), for value received, hereby promises to pay to the Registered Owner identified above or its registered assigns, on the maturity date specified above (or on earlier redemption as herein provided), upon presentation and surrender of this Certificate at the principal corporate trust office of Texas Commerce Bank National Association, Houston, Texas, or its successor (the "Paying Agent/Registrar"), the principal amount identified above (or so much thereof as shall not have been paid or deemed to have been paid upon prior redemption) 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 to the United States of America, and to pay interest thereon at the rate shown above, calculated on a basis of a 360-day year composed of twelve 30-day months, from the later of the Issue Date identified above or the most recent interest payment date to which interest has been paid or duly provided for. Interest on this Certificate is payable on March 1, 1996, and each September 1 and March 1 thereafter until maturity or earlier redemption of this Certificate, by check sent by United States mail, first class, postage prepaid, by the Paying Agent/Registrar to the Registered Owner of record as of the close of business on the fifteenth day of the calendar month immediately preceding the applicable interest payment date, as shown on the registration books kept by the Paying Agent/Registrar. Any accrued interest payable at maturity or earlier redemption shall be paid upon presentation and surrender of this Certificate at the principal corporate trust office of the Paying Agent/Registrar. 10 REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS CERTIFICATE 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, the City has caused its corporate seal to be impressed or placed in facsimile hereon and this Certificate to be signed by the Mayor Pro Tem, countersigned by the Interim City Secretary by their manual, lithographed or printed facsimile signatures. (AUTHENTICATION OR CITY OF PEARLAND, TEXAS REGISTRATION CERTIFICATE) Mayor Pro Tern (SEAL) COUNTERSIGNED: Interim City Secretary * * * [REVERSE OF CERTIFICATE] THIS CERTIFICATE IS ONE OF A DULY AUTHORIZED SERIES OF CERTIFICATES (the "Certificates") in the aggregate principal amount of $5,000,000 issued pursuant to an ordinance adopted by the City Council of the City on April 24, 1995 (the "Ordinance") for the purpose of providing all or part of the funds to pay contractual obligations to be incurred for (i) certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Lizer Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Lizer Road; renovations and improvements to Shadybend Drive (including drainage) from Liberty Drive to Misty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West 11 S Broadway and O'Day Road, (ii) renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's public library located at 3523 Liberty Drive, Pearland, Texas 77581, and (iii) the acquisition, construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City-wide storm water drainage plan. Proceeds of the Certificates also will be used to pay costs of issuance of the Certificates and other professional services related thereto. THIS CERTIFICATE shall not be valid or obligatory for any purpose or be entitled to any benefit under the Ordinance unless this Certificate either (i) is registered by the Comptroller of Public Accounts of the State of Texas by due execution of the registration certificate endorsed hereon or (ii) is authenticated by the Paying Agent/Registrar by due execution of the authentication certificate endorsed hereon. THE CITY RESERVES THE RIGHT, at its option, to redeem, prior to their maturity, Certificates maturing on and after March 1, 2006, in whole or in part, on March 1, 2005, or any date thereafter, at par plus accrued interest to the date fixed for redemption. CERTIFICATES MAY BE REDEEMED IN PART only in integral multiples of$5,000. If a Certificate subject to redemption is in a denomination larger than $5,000, a portion of such Certificate may be redeemed, but only in integral multiples of$5,000. In selecting portions of Certificates for redemption, each Certificate shall be treated as representing that number of Certificates of$5,000 denomination which is obtained by dividing the principal amount of such Certificate by $5,000. Upon surrender of any Certificate for redemption in part, the Paying Agent/Registrar, in accordance with the provisions of the Ordinance, shall authenticate and deliver in exchange therefor a Certificate or Certificates of like maturity and interest rate in an -. aggregate principal amount equal to the unredeemed portion of the Certificate so surrendered. NOTICE OF ANY SUCH REDEMPTION, identifying the Certificates or portions thereof to be redeemed, shall be sent by United States mail, first class, postage prepaid, to the Registered Owners thereof at their addresses as shown on the books of registration kept by the Paying Agent/Registrar, not less than thirty (30) days before the date fixed for such redemption. • By the date fixed for redemption, due provision shall be made with the Paying Agent/Registrar for the payment of the redemption price of the Certificates called for redemption. If such notice of redemption is given, and if due provision for such payment is made, all as provided above, the Certificates which are to be so redeemed thereby automatically shall be redeemed prior to their scheduled maturities, they shall not bear interest after the date fixed for redemption, and they shall not be regarded as being outstanding except for the purpose of being paid with the funds so provided for such payment. 12 THIS CERTIFICATE IS TRANSFERABLE only upon presentation and surrender at the principal corporate trust office of the Paying Agent/Registrar, accompanied by an assignment duly executed by the Registered Owner or its authorized representative, subject to the terms and conditions of the Ordinance. T THIS CERTIFICATE IS EXCHANGEABLE at the principal corporate trust office of the Paying Agent/Registrar for a Certificate or Certificates of the same maturity and interest rate and in the principal amount of$5,000 or any integral multiple thereof, subject to the terms and conditions of the Ordinance. THE PAYING AGENT/REGISTRAR is not required to accept for transfer or exchange any Certificate called for redemption, in whole or in part, during the forty-five (45) day period immediately prior to the date fixed for redemption; provided, however, that such limitation shall not apply to the transfer or exchange by the Registered Owner of an unredeemed portion of a Certificate called for redemption in part. THE CITY OR PAYING AGENT/REGISTRAR may require the Registered Owner of any Certificate 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 a Certificate. Any fee or charge of r the Paying Agent/Registrar for a transfer or exchange shall be paid by the City. THE REGISTERED OWNER of this Certificate by acceptance hereof, acknowledges and ,,. agrees to be bound by all the terms and conditions of the Ordinance. IT IS HEREBY DECLARED AND REPRESENTED that this Certificate has been duly and validly issued and delivered; that all acts, conditions and things required or proper to be performed, exist and to be done precedent to or in the issuance and delivery of this Certificate have been performed, exist and have been done in accordance with law; that the Certificates do not exceed any constitutional or statutory limitation; and that annual ad valorem taxes sufficient to provide for the payment of the interest on and principal of this Certificate, as such interest comes due and such principal matures, have been levied and ordered to be levied, within the limits prescribed by law, against all taxable property in the City and have been irrevocably pledged for such payment. IT IS FURTHER DECLARED AND REPRESENTED that the revenues to be derived from the City's waterworks and sanitary sewer system, after the payment of all operation and maintenance expenses thereof (the "Net Revenues"), in an amount not to exceed $10,000, are pledged to the payment of the principal of and interest on the Certificates to the extent that ad valorem taxes may ever be insufficient or unavailable for such purpose, provided that the pledge of Net Revenues is and shall be junior and subordinate in all respects to the pledge of Net Revenues to the payment of any obligation of the City, whether authorized heretofore or hereafter, which the City designates as having a pledge senior to the pledge of the Net Revenues to the payment of the Certificates. The City also reserves the right to issue, for any lawful purpose at any time, in one or more installments, bonds, certificates of obligation and other 13 obligations of any kind, secured in whole or in part by a pledge of Net Revenues, that may be prior and superior in right to, on a parity with, or junior and subordinate to the pledge of Net Revenues securing the Certificates. REFERENCE IS HEREBY MADE TO THE ORDINANCE, a copy of which is filed with the Paying Agent/Registrar, for the full provisions thereof, to all of which the Registered Owners of the Certificates assent by acceptance of the Certificates. * * * FORM OF COMPTROLLER'S REGISTRATION CERTIFICATE The following form of Comptroller's Registration Certificate shall be attached or affixed to each of the Certificates initially delivered: THE STATE OF TEXAS REGISTER NO. OFFICE OF THE COMPTROLLER OF PUBLIC ACCOUNTS I hereby certify that this certificate has been examined, certified as to validity and approved by the Attorney General of the State of Texas, and that this certificate has been registered by the Comptroller of Public Accounts of the State of Texas. WITNESS MY SIGNATURE AND SEAL OF OFFICE this Comptroller of Public Accounts [SEAL] of the State of Texas * * * 14 ft FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE The following form of authentication certificate shall be printed on the face of each of the Certificates other than those initially delivered: �- AUTHENTICATION CERTIFICATE This Certificate is one of the Certificates described in and delivered pursuant to the within-mentioned Ordinance; and, except for the Certificates initially delivered, this Certificate has been issued in exchange for or replacement of a Certificate, Certificates, or a portion of a Certificate or Certificates of an issue which originally was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas. TEXAS COMMERCE BANK NATIONAL ASSOCIATION, as Paying Agent/Registrar • By Authorized Signature Date of Authentication: * * * 1 1' r 15 r FORM OF ASSIGNMENT The following form of assignment shall be printed on the back of each of the Certificates: ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto (Please print or type name, address, and zip code of Transferee) (Please insert Social Security or Taxpayer Identification Number of Transferee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints attorney to transfer such certificate on the books kept for registration thereof, with full power of substitution in the premises. DATED: Signature Guaranteed: Registered Owner NOTICE: The signature above must correspond to the name of the registered owner as shown on the face of this certificate NOTICE: Signature must be guaranteed in every particular, without any alteration, by a member firm of the New York Stock enlargement or change whatsoever. Exchange or a commercial bank or trust company. ARTICLE V SECURITY FOR THE CERTIFICATES Section 5.1. Pledge and Levy of Taxes and Revenues. (a) To provide for the payment of principal of and interest on the Certificates, there is hereby levied, within the limits prescribed by law, for the current year and each succeeding year thereafter, while the Certificates or any part of the principal thereof and the interest thereon remain outstanding and unpaid, an ad valorem tax upon all taxable property within the City sufficient to pay the interest on the Certificates and to create and provide a sinking fund of not less than 2% of the principal amount of the Certificates or not less than the principal payable out of such tax, whichever is greater, with full allowance being made for tax delinquencies and the costs of tax collection, and such taxes, when collected, shall be applied to the payment of principal of and interest on the 16 Certificates by deposit to the Combination Tax and Revenue Certificates of Obligation, Series 1995 Debt Service Fund and to no other purpose. (b) The City hereby declares its purpose and intent to provide and levy a tax legally sufficient to pay the principal of and interest on the Certificates, it having been determined that the existing and available taxing authority of the City for such purpose is adequate to permit a legally sufficient tax. As long as any Certificates remain outstanding, all moneys on deposit in, or credited to, the Combination Tax and Revenue Certificates of Obligation, Series 1995 Debt Service Fund shall be secured by a pledge of security, as provided by law for cities in the State of Texas. (c) In addition, the City also hereby pledges the revenues to be derived from the City's waterworks and sanitary sewer system, after the payment of all operation and maintenance expenses thereof(the "Net Revenues"), in an amount not to exceed $10,000, to the payment of the principal of and interest on the Certificates to the extent that the ad valorem taxes referred to in Section 4.1(a) of this Ordinance are ever insufficient or unavailable for such purpose, _ provided that the pledge of Net Revenues is and shall be junior and subordinate in all respects to the pledge of Net Revenues to the payment of any obligation of the City, whether authorized heretofore or hereafter, which the City designates as having a pledge senior to the pledge of the Net Revenues to the payment of the Certificates. The City also reserves the right to issue, for any lawful purpose at any time, in one ore more installments, bonds, certificates of obligation and other obligations of any kind, secured in whole or in part by a pledge of Net Revenues, that may be prior and superior in right to, on a parity with, or junior and subordinate to the pledge of Net Revenues securing the Certificates. Section 5.2. Debt Service Fund. The Combination Tax and Revenue Certificates of Obligation, Series 1995 Debt Service Fund is hereby created as a special fund solely for the benefit of the Certificates. The City shall establish and maintain such fund at an official City ,.. depository and shall keep such fund separate and apart from all other funds and accounts of the City. Any amount on deposit in the Combination Tax and Revenue Certificates of Obligation, Series 1995 Debt Service Fund shall be maintained by the City in trust for the Registered Owners of the Certificates. Such amount, plus any other amounts deposited by the City into such fund and any and all investment earnings on amounts on deposit in such fund, shall be used only to pay the principal of, premium, if any, and interest on the Certificates. Section 5.3: Further Proceedings. After the Certificates to be initially issued have been executed, it shall be the duty of the Mayor Pro Tern to deliver the Certificates to be initially issued and all pertinent records and proceedings to the Attorney General for examination and approval. After the Certificates to be initially issued shall have been approved by the Attorney General, they shall be delivered to the Comptroller for registration. Upon registration of the Certificates to be initially issued, the Comptroller (or a deputy lawfully designated in writing to act for the Comptroller) shall manually sign the Comptroller's registration certificate prescribed herein to be affixed or attached to the Certificates to be initially issued, and the seal of said Comptroller shall be impressed, or placed in facsimile, thereon. 17 ARTICLE VI CONCERNING THE PAYING AGENT/REGISTRAR Section 6.1: Acceptance. Texas Commerce Bank National Association, Houston,Texas, is hereby appointed as the initial Paying Agent/Registrar for the Certificates pursuant to the terms and provisions of the Paying Agent/Registrar Agreement by and between the City and the Paying Agent/Registrar. The Paying Agent/Registrar Agreement shall be substantially in the form attached hereto as Exhibit A, the terms and provisions of which are hereby approved, and the Mayor Pro Tem is hereby authorized to execute and deliver such Paying Agent/Registrar Agreement on behalf of the City in multiple counterparts and the Interim City Secretary is hereby authorized to attest thereto and affix the City's seal. Such initial Paying Agent/Registrar and any successor Paying Agent/Registrar, by undertaking the performance of the duties of the Paying Agent/Registrar hereunder, and in consideration of the payment of any fees pursuant to the terms of any contract between the Paying Agent/Registrar and the City and/or the deposits of money pursuant to this Ordinance, shall be deemed to accept and agree to abide by the terms of this Ordinance. Section 6.2: Trust Funds. All money transferred to the Paying Agent/Registrar in its capacity as Paying Agent/Registrar for the Certificates under this Ordinance (except any sums representing Paying Agent/Registrar's fees) shall be held in trust for the benefit of the City, shall be the property of the City and shall be disbursed in accordance with this Ordinance. Section 6.3: Certificates Presented. Subject to the provisions of Section 6.4, all matured Certificates presented to the Paying Agent/Registrar for payment shall be paid without the necessity of further instructions from the City. Such Certificates shall be canceled as provided herein. Section 6.4: Unclaimed Funds Held by the Paying Agent/Registrar. Funds held by the Paying Agent/Registrar that represent principal of and interest on the Certificates remaining unclaimed by the Registered Owner thereof after the expiration of three years from the date such funds have become due and payable (a) shall be reported and disposed of by the Paying Agent/Registrar in accordance with the provisions of Title 6 of the Texas Property Code, as amended, to the extent such provisions are applicable to such funds, or (b) to the extent such provisions do not apply to the funds, such funds shall be paid by the Paying Agent/Registrar to the City upon receipt by the Paying Agent/Registrar of a written request therefor from the City. r The Paying Agent/Registrar shall have no liability to the Registered Owners of the Certificates by virtue of actions taken in compliance with this Section. Section 6.5: Paying Agent/Registrar May Own Certificates. The Paying Agent/Registrar in its individual or any other capacity, may become the owner or pledgee of Certificates with the same rights it would have if it were not the Paying Agent/Registrar. r 18 r r Section 6.6: Successor Paving Agents/Registrars. The City covenants that at all times while any Certificates are Outstanding it will provide a legally qualified bank, trust company, financial institution or other agency to act as Paying Agent/Registrar for the Certificates. The City reserves the right to change the Paying Agent/Registrar for the Certificates on not less than sixty (60) days' written notice to the Paying Agent/Registrar, as long as any such notice is effective not less than 60 days prior to the next succeeding principal or interest payment date on the Certificates. Promptly upon the appointment of any successor Paying Agent/Registrar, the previous Paying Agent/Registrar shall deliver the Register or a copy thereof to the new Paying Agent/Registrar, and the new Paying Agent/Registrar shall notify each Registered Owner, by United States mail, first class, postage prepaid, of such change and of the address of the new Paying Agent/Registrar. Each Paying Agent/Registrar hereunder, by acting in that capacity, shall be deemed to have agreed to the provisions of this Ordinance. ARTICLE VII PROVISIONS CONCERNING SALE AND APPLICATION OF PROCEEDS OF CERTIFICATES Section 7.1: Sale of Certificates: Insurance. The sale of the Certificates to NationsBanc Capital Markets, Inc. (the "Purchaser") at a price of the par value thereof plus accrued interest on the Certificates, is hereby approved, and delivery of the Certificates to the Purchaser shall be made upon payment therefor in accordance with the terms of sale and the terms and conditions of the Purchaser's bid. It is hereby officially found, determined and declared that the Purchaser is the highest bidder for the Certificates as a result of invitations for competitive bids. It is further officially found, determined and declared that the Certificates have been sold at public sale to the bidder offering the lowest interest cost, which is hereby determined to be a net effective interest rate of 5.6249%, after receiving sealed bids pursuant to an Official Notice of Sale and Preliminary Official Statement prepared and distributed in connection with the sale of �. the Certificates. The City hereby acknowledges that the Purchaser's bid is contingent upon the issuance of a policy of municipal bond guaranty insurance from Capital Guaranty Insurance Company ("Capital Guaranty") insuring the timely payment of principal of and interest on the Certificates. Such insurance is to be obtained at the Purchaser's expense. The appropriate officials and representatives of the City are hereby authorized and directed to execute such documents and certificates and to do any and all things necessary or desirable to obtain such insurance, and the printing on the Certificates of an appropriate legend or statement regarding such insurance, as provided by Capital Guaranty, is hereby approved. Section 7.2: Approval. Registration and Delivery. The Mayor Pro Tem is hereby authorized to have control and custody of the Certificates and all necessary records and proceedings pertaining thereto pending their delivery, and the Mayor Pro Tern and other officers and employees of the City are hereby authorized and directed to make such certifications and to execute such instruments as may be necessary to accomplish the delivery of the �.. 19 r Certificates and to assure the investigation, examination and approval thereof by the Attorney General and the registration of the initial Certificates by the Comptroller. Upon registration of the Certificates, the Comptroller (or the Comptroller's certificates clerk or an assistant certificates clerk lawfully designated in writing to act for the Comptroller) shall manually sign the Comptroller's Registration Certificates prescribed herein to be attached or affixed to each Certificates initially delivered and the seal of the Comptroller shall be impressed or printed or lithographed thereon. Section 7.3: Offering Documents; Ratings. The City hereby approves the form and contents of the Official Notice of Sale, Preliminary Official Statement and the final Official Statement, dated as of the date hereof, relating to the Certificates, and any addenda, supplement or amendment thereto, and ratifies and approves the distribution of such Preliminary Official Statement and Official Statement in the offer and sale of the Certificates and in the reoffering of the Certificates by the Purchaser, with such changes therein or additions thereto as the officials executing same may deem advisable, such determination to be conclusively evidenced by their execution thereof. The Mayor Pro Tern is hereby authorized and directed to execute, and the Interim City Secretary is hereby authorized and directed to attest, the final Official Statement. It is further hereby officially found, determined and declared that the statements and representations contained in the Official Notice of Sale, Preliminary Official Statement and final Official Statement are true and correct in all material respects, to the best knowledge and belief of the City Council, and that, as of the date thereof, the Preliminary Official Statement was an official statement of the City with respect to the Certificates that was deemed "final" by an authorized official of the City except for the omission of no more than the information permitted by subsection (b)(1) of Rule 15c2-12 of the Securities and Exchange Commission. Further, the City Council hereby ratifies, authorizes and approves the actions of the Mayor Pro Tem, the City's financial advisor and other consultants in seeking ratings on the Certificates from Moody's Investors Service, Inc. and Standard & Poor's Ratings Group and such actions are hereby ratified and confirmed. Section 7.4: Application of Proceeds of Certificates: Appropriation. Proceeds from the sale of the Certificates shall, promptly upon receipt by the City, be applied as follows: (1) Accrued interest shall be deposited into the Combination Tax and Revenue — Certificates of Obligation, Series 1995 Debt Service Fund created in Section 5.2 of this Ordinance; (2) A portion of the proceeds shall be applied to pay expenses arising in connection with the issuance of the Certificates; (3) The remaining proceeds shall be applied, together with other funds of the City, to provide funds to pay contractual obligations to be incurred for the construction of a public work and the purchase of materials, supplies, equipment, machinery, buildings, land and rights-of-way for authorized 20 needs and purposes, including specifically the projects enumerated in paragraph (a) of Section 1.1. Section 7.5: Tax Exemption. The City intends that the interest on the Certificates shall be excludable from gross income of the owners thereof for federal income tax purposes pursuant to Sections 103 and 141 through 150 of the Internal Revenue Code of 1986, as amended (the "Code"), and all applicable temporary, proposed and final regulations and procedures promul- gated thereunder or promulgated under the Internal Revenue Code of 1954, to the extent applicable to the Code (the "Regulations"), necessary to assure that interest on the Certificates is excludable from gross income of the owners thereof for federal income tax purposes. For that purpose, the City covenants that it shall use, permit the use of or omit to use the proceeds of the Certificates or any other amounts (or any property the acquisition, construction or improvement of which is to be financed directly or indirectly with the proceeds of the Certificates), regulate investments of proceeds thereof and take or omit to take such other and further actions as may be required by Sections 103 and 141 through 150 of the Code and the Regulations to cause the interest on the Certificates to be and remain excludable from the gross income, as defined in Section 61 of the Code, of the owners of the Certificates for federal income tax purposes. Without limiting the generality of the foregoing, unless and until the City has received a written opinion of nationally recognized bond counsel to the effect that failure to comply with such covenant will not adversely affect the exclusion of interest on the Certificates from gross income of the owner thereof for federal income tax purposes, the City shall comply with each of the specific covenants in this Ordinance, as follows: (a) The City will use all of the Net Proceeds (as defined below) of the Certificates to (i) provide funds to pay contractual obligations to be incurred for the construction of a public work and the purchase of materials, supplies, equipment, machinery, buildings, land and rights-of-way for authorized needs and purposes, including specifically a public works/vehicle maintenance facility and (ii) to pay the costs of issuing the Certificates. (b) The City has limited, and will limit, the amount of original or investment proceeds of the Certificates to be used (other than use as a member of the general public) in the trade or business of any person other than a governmental unit to an amount which does not exceed ten percent of the Net Proceeds of the Certificates ("private-use proceeds"). For purposes of this Section, the term "person" includes any individual, corporation, partnership, unincorporated asso- ciation or any other entity capable of carrying on a trade or business; and the term "trade or business" means, with respect to any natural person, any activity regularly carried on for profit and, with respect to persons other than natural persons, means any activity other than an activity carried on by a governmental unit. Any use of proceeds of the Certificates in any manner contrary to the guidelines set forth in Revenue Procedure 93-19, including any revisions or 21 amendments thereto, shall constitute the use of such proceeds in the trade or business of one who is not a governmental unit. (c) The City has not permitted and will not permit, more than five percent of the Net Proceeds of the Certificates to be used in the trade or business of any person other than a governmental unit if such use is unrelated to the governmental pur- pose of the Certificates. Further, the amount of private-use proceeds of the Certificates in excess of five percent of the Net Proceeds of the Certificates ("excess private-use proceeds") will not exceed the proceeds of the Certificates expended for the governmental purpose of the Certificates which such excess private-use proceeds relate; (d) The City will not permit to be used an amount of proceeds of the Certificates exceeding the lesser of (i) $5,000,000 or (ii) five percent of the Net Proceeds of the Certificates to be used, directly or indirectly, to make or finance loans to persons other than governmental units; (e) Based upon all facts and estimates now known or reasonably expected to be in existence on the date the Certificates are delivered, the City reasonably expects that the proceeds of the Certificates will not be used in a manner that would cause the Certificates or any portion thereof to be an "arbitrage bond" within the meaning of Section 148 of the Code; (f) The City will monitor the yield on the investment of the proceeds of the Certificates and moneys pledged to the repayment of the Certificates and will restrict the yield on such investments to the extent required by the Code or the Regulations. Without limiting the generality of the foregoing, the City will take appropriate steps to restrict the yield on all original and investment proceeds of the Certificates remaining on hand on or after that date which is three years from the date of delivery of the Certificates and all other proceeds (other than amounts constituting a "minor portion" of the proceeds or a "bona fide debt service fund") to a yield which is not materially higher than the lower of (a) the yield on the Certificates or (b) the combined yield on the Certificates and all other obligations of the City which are issued at substantially the same time as the Certificates, sold pursuant to a common plan of financing with the Certificates and will be paid out of substantially the same source of funds (or will have the same claim to be paid out of the same source of funds) as the Certificates (in all cases calculated in accordance with the Code and Regulations); (g) The City will not take any action, or as the case may be, knowingly omit to take any action, within its control that, if taken or omitted, would cause the Certificates to be treated as "federally guaranteed" obligations for purposes of Section 149(b) of the Code and applicable regulations thereunder (as may be 22 modified in any applicable rules, rulings, policies, procedures, regulations or other official statements promulgated or proposed by the Department of the Treasury or the Internal Revenue Service with respect to "federally guaranteed" obligations described in Section 149(b) of the Code) except as permitted by Section 149(b)(3) of the Code and such regulations; (h) The City will take all necessary steps to comply with the requirement that certain amounts earned by the City on the investment of the "gross proceeds" of the Certificates (within the meaning of section 148(f)(6)(B) of the Code), if any, be rebated to the federal government. Specifically, the City will (i) maintain records regarding the receipt, investment, and expenditure of the gross proceeds of the Certificates as may be required to calculate and substantiate the amount earned on the investment of the gross proceeds of the Certificates separately from records of amounts on deposit in the funds and accounts of the City allocable to other obligations of the City or moneys which do not represent gross proceeds of any obligations of the City, and retain such records for at least six years after the date the last outstanding Certificate is discharged or for such large period of time as may be required or appropriate under the Code or applicable regulations (ii) account for all gross proceeds under a reasonable, consistently applied method of accounting, not employed as an artifice or device to avoid, in whole or in part, the requirements of Section 148 of the Code, including any specified method of accounting required by applicable regulations to be used for all or a portion of the gross proceeds, (iii) calculate, at such times as are required by applicable regulations, the amount earned from the investment of the gross proceeds of the Certificates and (iv) timely pay, all amounts required to be rebated to the federal government. In addition, the City will exercise reasonable diligence to assure that no errors are made in the calculations required in the preceding sentence and, if such an error is made, to discover and promptly correct within a reasonable amount of time thereafter, including the payment to the federal government of any delinquent amounts owed to it, including interest thereon and penalty, if any, as may be necessary or appropriate to assure that interest on the Certificates is not includable in the gross income, as defined in Section 61 of the Code, of the owners of the Certificates for federal income tax purposes. (i) The City will not directly or indirectly pay any amount otherwise payable to the federal government pursuant to the foregoing requirements to any person other than the federal government by entering into any investment arrangement with respect to the gross proceeds of the Certificates that might result in a reduction in the amount required to be paid to the federal government under Section 148(f) of the Code or the applicable regulations, such as through an arrangement that results in a smaller profit or a larger loss than would have resulted if the arrangement had been at arm's length and had the yield on the Certificate not been relevant to either party. 23 a (j) The City will timely file or cause to be filed with the Secretary of the Treasury of the United States, an information statement required by Section 149(e) of the Code and applicable regulations thereunder with respect to the Certificates, on such form and in such place as the Secretary may prescribe from time to time. (k) The City hereby designates the Certificates as "qualified tax-exempt obligations" as defined in Section 265(b)(3) of the Code. With respect to such designation, the City represents the following: (a) that during the calendar year 1995, the City (including all entities which issue obligations on behalf of the City, has not designated nor will designate obligations, which when aggregated with the Certificates, will result in more than $10,000,000 of "qualified tax-exempt obligations" being issued and (b) that the City has examined its financing needs for the calendar year 1995 and reasonably anticipates that the amount of bonds, leases, loans or other obligations, together with the Certificates and any other tax- exempt obligations heretofore issued by the City (plus those other entities which issue obligations on behalf of the City during calendar year 1995), when the higher of the face amount or the issue price of each such tax-exempt obligation issued for calendar year 1995 by the City is taken into account, will not exceed $10,000,000. When used in this Section, the term Net Proceeds of the Certificates shall mean the proceeds from the sale of the issue of the Certificates, including investment earnings on the proceeds of such issue, less accrued interest with respect to such issue. 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 regarding the foregoing as of the date the Certificates are delivered. In complying with the foregoing covenants, the City may rely from time to time upon an opinion issued by a nationally -. recognized bond counsel to the effect that any action by the City or reliance upon any interpretation of the Code or Regulations contained in such opinion will not cause interest on the Certificates to be includable in gross income for federal income tax purposes under existing law. Notwithstanding any other provision of this Ordinance, the City's obligations under the covenants and provisions of this Section 7.5 shall survive the defeasance and discharge of the Certificates. Section 7.6: Related Matters. In order that the City shall satisfy in a timely manner all of its obligations under this Ordinance, the Mayor, the Mayor Pro Tern, Interim City Secretary and all other appropriate officers, agents, representatives and employees of the City are hereby authorized and directed to take all other actions that are reasonably necessary to provide for the issuance and delivery of the Certificates, including, without limitation, executing and delivering on behalf of the City all certificates, consents, receipts, requests, notices, and other documents as may be reasonably necessary to satisfy'the City's obligations under this Ordinance and to 24 a direct the transfer and application of funds of the City consistent with the provisions of this Ordinance. ARTICLE VIII MISCELLANEOUS Section 8.1: Defeasance. The City may defease the provisions of this Ordinance and discharge its obligations to the Registered Owners of any or all of the Certificates to pay the principal of and interest thereon in any manner permitted by law, including by depositing with the Paying Agent/Registrar or with the State Treasurer of the State of Texas either: (a) cash in an amount equal to the principal amount of such Certificates plus interest thereon to the date of maturity or redemption; or (b) pursuant to an escrow or trust agreement, cash and/or direct obligations of, or obligations the principal of and interest on which are guaranteed by the United States of America, in principal amounts and maturities and bearing interest at rates sufficient to provide for the timely payment of the principal amount of the Certificates plus interest thereon to the date of maturity or redemption; provided, however, that if any of the Certificates are to be redeemed prior to their respective dates of maturity, provision shall have been made for giving notice of redemption as provided in this Ordinance. Upon such deposit, such Certificates shall no longer be regarded to be Outstanding or unpaid. Any surplus amounts not required to accomplish such defeasance shall be returned to the City. Section 8.2: Legal Holidays. In any case where the date interest accrues and becomes payable on the Certificates or principal of the Certificates matures or the date fixed for redemption of any Certificates or a Record Date shall be in the City a Saturday, Sunday, legal holiday or a day on which banking institutions are authorized by law to close, then payment of interest or principal need not be made on such date, or the Record Date shall not occur on such date, but payment may be made or the Record Date shall occur on the next succeeding day which is not in the City a Saturday, Sunday, legal holiday or a day on which banking institutions are authorized by law to close with the same force and effect as if (i) made on the date of maturity or the date fixed for redemption and no interest shall accrue for the period from the date of maturity or redemption to the date of actual payment or (ii) the Record Date had occurred on the fifteenth day of that calendar month. Section 8.3: No Recourse Against City Officials. No recourse shall be had for the payment of principal of or interest on any Certificates or for any claim based thereon or on this Ordinance against any official of the City or any person executing any Certificates. Section 8.4: Further Proceedings. The Mayor, Mayor Pro-Tem, 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 of this Ordinance. 25 _ Section 8.5: 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 unenforceability of such Section, paragraph, clause or provision shall not affect any of the remaining provisions of this Ordinance. Section 8.6: Open Meeting. It is hereby found, determined and declared that a sufficient written notice of the date, hour, place and subject of the meeting of the City Council at which this Ordinance was adopted was posted at a place convenient and readily accessible at all times to the general public at City Hall for the time required by law preceding this meeting, as required by the Open Meetings Law, Chapter 551, Texas Government Code, and that this meeting has been open to the public as required by law at all times during which this Ordinance and the subject matter thereof has been discussed, considered and formally acted upon. The City Council further ratifies, approves and confirms such written notice and the contents and posting thereof. Section 8.7: Repealer. All orders, resolutions and ordinances, or parts thereof, inconsistent herewith are hereby repealed to the extent of such inconsistency. Section 8.8: Emergency. 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 exists, the specific emergency being that the proceeds from the sale of the Certificates are required as soon as possible for necessary and urgently needed improvements, and that this Ordinance be passed and approved on the date of its introduction. Section 8.9: Effective Date. This Ordinance shall be in force and effect from and after its passage on the date shown below. 26 PASSED AND APPROVED on first reading pursuant to Section 3.10 of the City Charter this April 24 , 1995. CITY OF PEARLA , TEXAS l Mayor Pro Tem ATTEST 2l 22GC e r//, Interim City Sec tary (SEAL) Exhibit A — Paying Agent/Registrar Agreement Exhibit B — Official Notice of Sale Exhibit C — Preliminary Official Statement Exhibit D — Official Statement 0216086.01 049521/1607 a a 27 a EXHIBIT A PAYING AGENT/REGISTRAR AGREEMENT See Tab No. 6 a a EXHIBIT B OFFICIAL NOTICE OF SALE See Tab No. 4 a — a a a a a a a a a a EXHIBIT C OFFICIAL ST ATEM`E� P I'Th p gY pFF See Tab No 4 0111 • S� MD so See �o, 5 021 (1 °29 o69S*' so soo a so • ss r r" PAYING AGENT/REGISTRAR AGREEMENT THIS PAYING AGENT/REGISTRAR AGREEMENT dated as of April 24, 1995 (together with any amendments or supplements hereto, the "Agreement") is entered into by and between the CITY OF PEARLAND, TEXAS (the "Issuer"), and TEXAS COMMERCE BANK NATIONAL ASSOCIATION,HOUSTON,TEXAS, as paying agent/registrar(together with any successor in such capacity, the "Bank"). WITNES SETH: WHEREAS, the Issuer has duly authorized and provided for the issuance of its City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995 (the "Certificates") in the aggregate principal amount of$5,000,000 to be issued as fully registered certificates; WHEREAS, all things necessary to make the Certificates the valid obligations of the Issuer, in accordance with their terms, will be done upon the issuance and delivery thereof; WHEREAS, the Issuer and the Bank wish to provide the terms under which the Bank will act as Paying Agent to pay the principal of, redemption premium, if any, and interest on the Certificates, in accordance with the terms thereof, and under which the Bank will act as Registrar for the Certificates; and WHEREAS, the Issuer and the Bank have duly authorized the execution and delivery of this Agreement; and all things necessary to make this Agreement the valid agreement of the parties, in accordance with its terms, have been done. NOW, THEREFORE, it is mutually agreed as follows: ARTICLE ONE APPOINTMENT OF BANK AS PAYING AGENT AND REGISTRAR Section 1.01. Appointment. The Issuer hereby appoints the Bank to act as Paying Agent with respect to the Certificates, to pay to the Registered Owners of the Certificates, in accordance with the terms and provisions of this Agreement and the ordinance authorizing the issuance of the Certificates (the "Ordinance"), the principal of, redemption premium, if any, and interest on all or any of the Certificates. The Issuer hereby appoints the Bank as Registrar with respect to the Certificates. The Bank hereby accepts its appointment, and agrees to act as Paying Agent and Registrar with respect to the Certificates. 7 Section 1.02. Compensation. _ In consideration of the deposits of funds required to be made with the Bank by the Issuer ' pursuant to the provisions of the Ordinance, the Bank agrees to abide by and accept the terms hereof and of the Ordinance relating to the duties of the Paying Agent/Registrar. ARTICLE TWO DEFINITIONS Section 2.01. Definitions. For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires: "Bank" means Texas Commerce Bank National Association, Houston, Texas, a commercial bank which is a national bank duly organized and existing under the laws of the * United States of America. "Certificate" or "Certificates" means any one or all of the "City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995" authorized by the Ordinance. "Issuer" means the City of Pearland, Texas. "Ordinance" means the ordinance of the Issuer approved by its City Council on April 24, 1995, pursuant to which the Certificates are issued. 1 "Paying Agent" means the Bank when it is performing the function of paying agent. "Person" means any individual,corporation, partnership,joint venture, associations,joint stock company, trust, unincorporated organization or government or any agency or political subdivision of a government or any entity whatsoever. "Registrar" means the Bank when it is performing the function of registrar. "Registered Owner" means the Person in whose name any Certificate is registered in the books of registration maintained by the Bank under this Agreement. 1 All other capitalized terms shall have the meanings assigned to them in the Ordinance. I p 2 p Section 3.08. Money Held by Bank. Money held by the Bank hereunder shall be held in trust for the benefit of the Registered Owners of the Certificates. The Bank shall be under no obligation to pay interest on any money received by it hereunder. All money deposited with the Bank hereunder shall be secured in the manner and to the fullest extent required by law for the security of funds of the Issuer. Any money deposited with the Bank for the payment of the principal of or interest on any Certificates and remaining unclaimed by the Registered Owner after the expiration of three years from the date such funds have become due and payable shall be reported and disposed of by the Bank in accordance with the provisions of Texas law including, to the extent applicable, Title 6 of the Texas Property Code, as amended. To the extent such provisions of the Property Code do not apply to the funds, such funds shall be paid by the Bank to the Issuer upon receipt of a written request therefor from the Issuer. The Bank shall have no liability to the Registered Owners of the Certificates by virtue of actions taken in compliance with the foregoing provision. ARTICLE FOUR MISCELLANEOUS PROVISIONS Section 4.01. May Own Certificates. The Bank, in its individual or any other capacity, may become the owner or pledgee of Certificates with the same rights it would have if it were not the Paying Agent and Registrar for the Certificates. Section 4.02. Amendment. This Agreement may be amended only by an agreement in writing signed by both of the parties hereof. Section 4.03. Assignment. This Agreement may not be assigned by either party without the prior written consent of the other. Section 4.04. Notices. Any request, demand, authorization, direction, notice, consent, waiver or other document provided or permitted hereby to be given or furnished to the Issuer or the Bank shall be mailed 5 a I 1' or delivered to the Issuer or the Bank, respectively, at the addresses shown herein, or such other address as may have been given by one party to the other by 15 days' written notice. Section 4.05. Effect of Headings. The Article and Section headings herein are for convenience only and shall not affect the construction hereof. Section 4.06. Successors and Assigns. All covenants and agreements herein by the Issuer and the Bank shall bind their successors and assigns, whether so expressed or not. This Agreement shall not be assigned by the Bank without the prior written consent of the Issuer. Section 4.07. Severability. If any provision of this Agreement shall be invalid or unenforceable, the validity and �. enforceability of the remaining provisions hereof shall not in any way be affected or impaired. Section 4.08. Benefits of Agreement. Nothing herein, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, any benefit or any legal or equitable right, remedy or claim hereunder. Section 4.09. Ordinance Governs Conflicts. r This Agreement and the Ordinance constitute the entire agreement between the parties hereto relative to the Bank acting as Paying Agent and Registrar and if any conflict exists between this Agreement and the Ordinance, the Ordinance shall govern. The Bank agrees to be bound by the terms of the Ordinance with respect to the Certificates. Section 4.10. Term and Termination. This Agreement shall be effective from and after its date and may be terminated for any 100 reason by the Issuer or the Bank at any time upon 60 days' written notice; provided, however, that no such termination shall be effective until a successor has been appointed and has accepted the duties of the Bank hereunder. In the event of early termination, regardless of circumstances, the Bank shall deliver to the Issuer or its designee all funds, Certificates and all books and records pertaining to the Bank's role as Paying Agent and Registrar with respect to the Certificates, including, but not limited to, the books of registration. 6 Section 4.11. Governing Law. This Agreement shall be construed in accordance with and shall be governed by the laws a of the State of Texas. w IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. CITY OF E AND, TEXAS a By: David L. Smith, Jr., Mayor Pro Tem ADDRESS: 3519 Liberty Drive Pearland, Texas 77581 ATTEST: _ 1 '7111>vf ' 'emu, r}/ Tommie Jean Vial, Interim City Secretary — (SEAL) TEXAS COMMERCE BANK NATIONAL ASSOCIATION By: Title: Corporate Trust Officer ADDRESS: 600 Travis, 11th Floor Houston, Texas 77002 ATTEST: • B . �ii1--�Lrr� 1 /ZL� , Title: Assistant Vice President Corporate Trust Officer (SEAL) 0216671.01 049521/1413 7 r r TEXAS COMMERCE BANK NATIONAL ASSOCIATION SECRETARY'S CERTIFICATE r I, Melanie McKittrick, Vice President and Assistant Secretary of Texas Commerce Bank National Association (the "Bank") hereby certify that on January 12, 1994, April 13, 1994 and July 13, 1994, at meetings duly called and convened and at which a quorum was present, the Board of Directors of the Bank adopted the resolutions set forth below, and such resolutions are presently in full force and effect and have not been modified, revoked or rescinded: — -- RESOLVED, that for the purposes of the following resolutions, the following words shall have the meaning ascribed to them as follows: "Bank" shall mean Texas Commerce Bank National Association. "Trust Officer" shall mean any Corporate Trust Officer, any Real Estate Trust Officer, any Petroleum Trust Officer, any Personal Trust Officer, any Institutional Trust Officer, any Trust Operations Officer and any Trust Officer of the Bank. "Senior Officer" shall mean the Chairman of the Board, the President, any Vice Chairman, any Executive Vice President, any Senior Vice President, any Managing Director, any Vice President, the General Counsel, the Secretary, the Controller and the Cashier of the Bank, and any Chairman, any Vice Chairman, any Executive Vice President, any Senior Vice President, any Managing Director and any Vice President of any region of the Bank. "Senior Trust Officer" shall mean any Senior Corporate Trust Officer, any Senior Real Estate Trust Officer, any Senior Petroleum Trust Officer, any Senior Personal Trust Officer, any Senior Institutional Trust Officer, any Senior Trust Operations Officer and any Senior Trust Officer of the Bank. RESOLVED, that the Chairman of the Board, the President, any Vice Chairman, any Executive Vice President and Trust Officer, any Senior Vice President and Trust Officer, any Vice President and Trust Officer, any Assistant Vice President and Trust Officer, any Senior Trust Officer, and any Trust Officer of the Bank, and any Chairman, President, Vice Chairman, Executive Vice President and Trust Officer, Senior Vice President and Trust Officer, Vice President and Trust Officer, Assistant Vice President and Trust Officer, Senior Trust Officer, or Trust Officer of any region of the Bank be, and each of them hereby is, authorized to execute and deliver for and on behalf of the Bank agreements (including, but not limited to, agency agreements, transfer agency agreements, paying agency agreements, exchange agreements, escrow agreements and other similar agreements), indentures, mortgages, deeds, releases, conveyances, assignments, transfers, leases, demands, proofs of debt, claims, discharges, satisfactions, settlements, petitions, affidavits, receipts, instruments or documents, powers of attorney, records, bonds, undertakings, proxies, other agency powers, authentication r certificates appearing on bonds and debentures, registration certificates appearing on stock, 1 bond or debentures certificates and such other documents and instruments, other than r r r secretary's certificates or officer's certificates, as may be necessary and appropriate to carry out the fiduciary or agency powers of the Bank. RESOLVED, that the Senior Officers, the Chief Financial Officer, the Chief Administrative Officer, the Secretary, any Assistant Secretary, any Assistant Vice President, any Senior Trust Officer, any Trust Officer, and any Assistant Trust Officer of the Bank, and any Executive Vice President and Trust Officer, Senior Vice President and Trust Officer, Vice President and Trust Officer, Assistant Vice President and Trust Officer, Senior Trust Officer and Trust Officer of any region of the Bank be, and each of them hereby is, authorized to countersign. acknowledge or verify accounts, schedules, requisitions, certifications and declarations, other -- -- than secretary's certificates or officer's certificates, in connection with the exercise of the fiduciary or agency powers of the Bank. RESOLVED, that the power and authority conferred to any person pursuant to these resolutions shall include, but not be limited to, the power to execute any other documents and to do and perform such other acts and things as may be necessary or appropriate to consummate the transactions so authorized or to carry out the purposes and intent of such resolutions. EXECUTED effective as of the day of APR 2 4 , 1995, at Houston, Texas. - Texas Commerce Bank National Association _ r - _ _ By: Melanie McKittrick Vice President and Assistant Secretary p r p r p p r t CERTIFICATION AS TO CORPORATE AUTHORITY The undersigned officers of Texas Commerce Bank National Association, a national banking association, serving as Vice President and Trust Officer, under the resolution authorizing the issuance of $5,000,000 CITY OF PEARLAND, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 1995, hereby certifies as follows: The Agreements were executed on behalf of the Texas Commerce Bank National Association by the persons named below whose offices appear set opposite their names, and said persons were at the time of executing the Agreements, and are now, duly elected, qualified, and acting incumbents of their respective offices; and the signature appearing after each of said person' s names is the true and correct specimen of such person' s genuine signature. Name Office Signature Yolanda C. Garcia Corporate Trust Officer P Sharon McNeill Assistant Vice President and . Corporate Trust Officer ti-r4'7L P ,. The foregoing officers of the Texas Commerce Bank National Association by virtue of the authority delegated to them by the Board of Directors of the Texas Commerce Bank National Association pursuant to resolution, a true and correct copy of which is attached hereto as Exhibit A, are authorized to execute and deliver on behalf of the Texas Commerce Bank National Association such other and further documents as may be necessary or incidental to the acceptance and performance of the trusts set forth in the Agreements to attest any of the foregoing, and to apply the seal of the Texas Commerce Bank National Association thereto. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the Texas Commerce Bank National Association this day of APR 2 4 , 1995. By haj-c( J /� [SEAL] FEE SCHEDULE BOND REGISTRAR, TRANSFER AGENT, AND PAYING AGENT ACCEPTANCE For accepting appointment, execution of documents, attendance at closing, conferring with Interested parties and setting up records $0.00 BOND REGISTRAR Annual Administrative Charge 375.00 Account Maintenance For each bondholder account maintained, based upon the number of accounts maintained at the beginning of each billing period, plus all new accounts added 5.00 Annual Minimum 100.00 Bondholder List For each account 04 Minimum per List 50.00 Mailing Services Preparation of labels — per account 02 Minimum per set of labels 50.00 Inserting enclosures — per enclosure 02 Minimum per job 50.00 TRANSFER AGENT ACTIVITY For each bond issue. Includes cancellation of surrendered bond(s), and posting to account 1.85 Replacement of lost bonds 15.00 Cancelled bonds will be retained for one year without charge and then returned to the issuer. PAYING AGENT ACTIVITY Interest Payment For each check issued including calculation, check register, replacement of checks, and reconcilement 50 Minimum per payable date 50.00 Principal Payment For each bond redeemed at maturity or call 5.20 INCOME TAX REPORTING REQUIREMENTS For preparation of forms required to report income to either state, federal or individuals — per form 25 Minimum 250.00 ADDITIONAL EXPENSES Out—of—pocket expenses incurred in rendering any service covered by this schedule are in addition to the fees quoted. Expenses for which we are regularly reimbursed include, but are not limited to, counsel fees, travel expenses, publications, printing cost, postage, wire charges, long distance telephone calls, stationery, and forms. Fees as quoted above are subject to change. Notification of any change and a revised Fee Schedule will be mailed prior to invoicing. GENERAL CERTIFICATE STATE OF TEXAS § COUNTIES OF BRAZORIA AND HARRIS § CITY OF PEARLAND § We, the undersigned officers of the City of Pearland, Texas (the "City"), do hereby make and execute this certificate for the benefit of the Attorney General of the State of Texas and all other persons interested in the City's $5,000,000 CITY OF PEARLAND, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 1995, dated May 1, 1995 (the "Certificates"), now in the process of issuance, as follows: (1) The City is a duly incorporated Home Rule City, having more than 5,000 inhabitants, operating and existing under the Constitution and laws of the State of Texas and the duly adopted Home Rule Charter of the City, which charter or boundaries has not been changed since the approval by the Attorney General of the State of Texas of the City of Pearland, Texas Refunding Bonds, Series 1993, dated May 1, 1993, which are the last bonds issued by or on behalf of the City. (2) The Certificates are being issued to provide funds to pay contractual obligations to be incurred (a) for certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Lizer Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Lizer Road; renovations and improvements to Shadybend Drive (including drainage) from Liberty Drive to Misty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West Broadway and O'Day Road, (b) for renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's public library located at 3523 Liberty Drive, Pearland, Texas 77581, (c) for the acquisition, construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City-wide storm water drainage plan and, (d) for the payment of costs of issuance of the Certificates and other professional services related thereto. (3) From March 1, 1995, to May 8, 1995, the following individuals were the duly elected and qualified Mayor, Mayor Pro Tem and City Council of the City holding the offices opposite their names (except that C.V. Coppinger died on March 28, 1995, leaving a vacancy in the Mayor's office): C.V. Coppinger Mayor David L. Smith, Jr. Mayor Pro Tern D.A. Miller, Jr. Council Member Richard Tetens Council Member Randy K. Weber Council Member Jerry Richardson Council Member (4) From May 8, 1995, to the date hereof, the following individuals were the duly elected and qualified Mayor, Mayor Pro Tem and City Council of the City, holding the offices opposite their names: Vacant Mayor Richard Tetens Mayor Pro Tern Randy K. Weber Council Member Jerry Richardson Council Member Kevin Cole Council Member Helen Beckman Council Member (5) From March 1, 1995, to the date hereof, the following individuals were the duly appointed and qualified officers of the City holding the positions opposite their names: - Administration Position Paul Grohman City Administrator Richard Burdine Assistant City Manager Tommie Jean Vial Interim City Secretary Billy Jo Knight Tax Assessor/Collector (6) The Certificates were sold at a price equal to $5,000,000 (representing the principal amount of the Certificates plus accrued interest) by means of a competitive sale to NationsBanc Capital Markets, Inc. (7) Attached to this certificate as Exhibit A is a true, full and correct debt service schedule for the Certificates and for all presently outstanding obligations of the City which are payable from ad valorem taxes. (8) The currently effective ad valorem tax appraisal roll of the City (the "Tax Roll") is the Tax Roll prepared and approved during the calendar year 1994, being the most recently approved Tax Roll of the City; the taxable property in the City has been appraised, assessed and valued as required and provided by the Texas Constitution and Property Tax Code (collectively, "Texas law"); the Tax Roll for the year has been submitted to the City Council of the City as required by Texas law, and has been approved and recorded by the City Council; and according to the Tax Roll for the year, the net aggregate taxable value of taxable property in the City (after deducting the amount of all applicable exemptions required or authorized under Texas law), upon which the annual ad valorem tax of the City has been or will be imposed or levied, is $781,701,057. (9) The following is a true, full and current schedule of the City's waterworks and sewer system (the "System") revenues, remaining after the payment of all operation and maintenance expenses thereof ("Net Revenues"), for the past three fiscal years: 2 r Fiscal Year Ended September 30 1992 1993 1994 $850,851 $741,126 $1,209,965 (10) Attached to this certificate as Exhibit B is a true, full and current resolution establishing the utility rates of the System that are currently in effect. (11) Except as described in the Official Statement, neither the revenues nor the properties of the System are in any way pledged or hypothecated other than the pledge of the Net Revenues of the System to the Certificates now in the process of issuance, the City's Combination Tax and Revenue Certificates of Obligation, Series 1991 and the City's Waste Water and Sanitary Sewer System Improvement Bonds, Series 1966. (12) The City is not in default as to any covenant, condition or obligation on any prior �. bonds or other obligations payable from the Net Revenues of the System. r r 3 SIGNED AND SEALED this MAY 2 4 , 1995. CITY OF PEARLAND, TEXAS rtia-ce T JEAN i AL, DAVID . S16;71. Interim City Secretary Mayor Pro Tern (CITY SEAL) r r 1 0216107.01 049521/1557 4 1' �Cetes eaule cot tie Cert' Debt Service Scb • DF„$T SERVICE SCHEDULE The following sets forth the principal and interest requirements on the City's outstanding debt and the Certificates. Fiscal Year Outstanding Total New Total Ending Debt Tlie Certificates Principal Debt _ 9-30 $equirements Principa' Interest & Interest Service_ 1995 $ 2,033,151 $ 2,035,353 1996 2,028,804 $ 389,293 $ 389,293 2,418,098 1997 2,026,184 $ 130,000 287,420 417,4-20 2,443,604 1998 2,033,471 140,000 277,970 417,970 2,451,443 1999 2,023,969 150,000 267,820 417,820 2,441,790 2000 2,025,169 155,000 257,145 412,145 2,437,315 2001 2,027,266 165,000 245,945 410,945 2,438,212 2002 2,021,556 175,000 234,045 409,045 2,430,602 2003 2,017,434 185,000 221,445 406,445 2,423,880 2004 2,026,663 200,000 207,970 407,970 2,434,633 2005 2,028,049 210,000 195,510 405.510 2,433,559 2006 2,025,458 225,000 184,313 409,313 2,434,771 2007 2,031,930 240,000 172,335 412,335 2,444,265 2008 2,031,300 255.000 159,338 414,338 2,445.638 2009 2,032,800 270,000 145,290 415,290 2,448,090 2010 500,000 124,250 624,250 624,250 2011 500,000 96,500 596,500 596,500 2012 500,000 68,250 568,250 568,250 2013 500,000 39,500 539,500 539.500 2014 500.00U 12.500 512.500 512,500 $30,413„204 $5)00,000 $3,586,839 $8.586,839 139,0022 53 Avcrrge Annual Debt Service Requirements (1995/2014) S1,950,113 Maximum Annual Debt Service Requirement (1998) $2,451,443 r- f I r I Exhibit B Resolution Establishing Utility Rates of the System OFFICE OF THE CITY SECRETARY • CITY OF PEARL AND, TEXAS TO: PAULETTE MIRE DATE: SEPTEMBER 29, 1994 UTILITY BILLING SUPERVISOR At the SEPTEMBER 26, 1994 meeting of the City Council of the City of Pearland, Texas, the following matter was referred to you for appropriate disposal or for specific action as indicated: ORDINANCE NO. 679 - WATER & SEWER RATES - WAS PASSED & APPROVED ON THE SECOND AND FINAL READING Documents Attached: ORD. NO. 679 cc: RICHARD BURDINE City ecretary off.cs r ORDINANCE NO. 679 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY Or PEARLAND, TEXAS,DETERMINING CHARGES FOR WATER AND SEWER SERVICES FURNISHED BY TIIE CITY, AS PROVIDED IN CHAPTER 30, ARTICLE II, SECTION 30-38 OF TILE CODE OF ORDINANCES; REPEALING PREVIOUS WATER AND SEWER SERVICE RATE SCHEDULES; PROVIDING A SAVINGS CLAUSE, PROVIDING A SEVERABILITY CLAUSE AND PROVIDING AN EFFECTIVE DATE. WHEREAS, Chapter 30, Article II, Section 30-38 of the Code of Ordinances of the City of Pearland,Texas provides that the rates and charges for the consumption of utility services furnished by the City shall be determined by the City Council from time to time,and the same shall be on file in the office of the City Secretary; NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PEARLAND,TEXAS,THAT: Section 1. Definitions. Residential Unit-Any structure or part thereof used to fulfill the housing requirements of one or more persons living together as a single family. Commercial Unit-Any other structure or part thereof used to fulfill the housing requirements of not more than one business establishment or of not more than one establishment of any other kind, but a business unit shall not include any kind of multi-family establishment. Multi-Unit Residence or Business-A building consisting of two or more residential or commercial �. units. User - Any person, firm or corporation connected to the city water system for the purpose of receiving water service. Section 2. Water Rates. All property upon which any building has been or may hereafter be erected having a connection with any mains or pipes presently existing or which may be hereafter constructed and used in connection with the City water system shall pay the following rates each month for water service furnished by the City: Residential Unit or Commercial Unit Consisting of a Single Unit: Up to and including first 2000 gallons $8.25 $8 50 minimum All over 2000 gallons $tom$17 per 1000 gallons Multi-Unit Residence or Business: Up to and including first 2000 gallons $7.43$7 65 minimum per unit All over 2000 gallons $tom $1.41 per 1000 gallon .� usage The rate of $8.25 $8S�SI shall be the minimum monthly rate for all water users including the users for less than a monthly period. If the user's water meter becomes inoperative and fails to register, the user will be charged at the average monthly consumption as shown by the meter when in order.'All water that passes through the meter shall be charged for,whether used or not. 1 w• Section 3. Sewer Rates. The following rates or charges for the use and service of the sewage system of the City of Pcarland arc determined as follows: 1. Commercial and Industrial Users Ilaving City Water Service: The monthly sewer service charge for all Commercial and Industrial Users having City Water Service will be $8.63 $8.89 minimum for 2000 gallons of water usage or less and $t-H-$1.14 per 1000 gallons for water usage over 2000 gallons. 2. Commercial and Industrial Users Not !laving City Water Service: The monthly sewer service charge for all Commercial and Industrial Users having sewer set-vice but not having City Water Service will be $1-I-i- $1,14 per 1000 gallons of comparable bill for City Water Service. The City will install, at its expense, a water meter 'w in the private water supply and read the meter monthly to determine the amount of water consumption. $8.63 $8.89 Monthly Minimum charge. via 3. Commercial and Industrial Users Who Have Waste Water Discharge Split Between the ,Sanitary Sewer and Other Methods of Discharge: In the event only a portion of the user's waste water is discharged into the Sanitary Sewer, • the City Council, upon the user's request, shall estimate what portion of the water usage is discharged into the Sanitary Sewer and his monthly sewer charge will be figured accordingly. $8.63 $889 Monthly Minimum Charge. 4. Commercial and Industrial Users Who Use the Water That is a Part of Their Product or Production Process and That is Not Discharged into the Sanitary Sewer System: If water is a part of a Commercial or Industrial user's product or is used in his production process in such a manner that there is no discharge into the Sewer System, then, upon the user's request,the City Council will establish the amount of water used for such purpose and his monthly sewer charge will be figured accordingly. $8.63 $889r Monthly Minimum MIR Charge. 5. Residential Users Having City Water and Sewer Service: The monthly sewer set-vice charge for all users having City Water will be $8.61 $8,89 minimum for 2000 gallons of water usage or less and $i-H- $144 per 1000 gallons for water usage over 2000 gallons. 6. Residential Users llavine City Sewer Service but not having City Water Service; If a residential user is connected to the Sanitary Sewer System but not connected to the Water System,then the private system will be metered at City expense and the sewer rate will be $ttt$j'14 per 1000 gallons of the comparable bill for City Water Set-vice. $8-63 $8.89 Monthly Minimum Charge. 7. Multi-Unit Building.Residence or Business: Each unit of a multi-unit,residence or business which is separately metered will be charged a monthly sewer service charge at the rate of $8-66-$8.89 for 2000 gallons of water usage or less and $-t-t-t'$T 14 per 1000 gallons for water usage over 2000 gallons. 8. Multi-Unit Building With Common Water Meter for All Units: A multi-unit residence or business in which the units are served through a common water meter will be billed at the rate of $7.7G$13.00 minimum for 2000 gallons of water usage or less and S-hee$103 per 1000 gallons for water usage over 2000 gallons (Multi-unit being defined as being a building, residence or business consisting of two or more units.l 2 I ORDINANCE NO. 679 Section 4. Repealer. All previously adopted water and sewer rate schedules shall be and are hereby repealed. Section 5. Savings. All rights and remedies which have accrued in the favor of the City under this Ordinance and its amendments thereto shall be and are preserved for the benefit of the City. Section 6. Severability. If any section,subsection, sentence,clause, phrase,or portion of this Ordinance is for any reason held invalid or unconstitutional by any Court of competent jurisdiction, such portion shall be deemed a separate,distinct and independent provision and such holding shall not effect the validity of the remaining portions thereof. Section 7. Effective Date. This ordinance shall become effective on the Nuvc,ubci NOR-1-94/-3 0:04 billing. PASSED and APPROVED on First Reading this /aZ. day of A.D.,1994. rC. V. Coppin e , Mayor ATTEST: Pat Jones,Cit ecretary PA SED a d APPROVED on Second and Final Reading tltis2 G day of — C. .Coppinger, or rATTEST: Pat Jones,City cretary• APPROVED AS TO FORM: tats ile gifeerl Am Mo s-M Cullough, City Attorney r r 3 . SIGNATURE IDENTIFICATION AND NO-LITIGATION CERTIFICATE THE STATE OF TEXAS § COUNTIES OF BRAZORIA AND HARRIS § CITY OF PEARLAND § We, the undersigned officers of the City of Pearland, Texas (the "City"), certify that we officially signed, by our manual or facsimile signatures, on behalf of the City, the following described certificates of obligation, to wit: CITY OF PEARLAND, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 1995, dated May 1, 1995, and aggregating $5,000,000 (the "Certificates"). That the Certificates have been duly and officially executed by the undersigned with their manual or facsimile signatures in the same manner appearing hereon, and the undersigned hereby adopt and ratify their respective signatures in the manner appearing on each of the Certificates, whether in manual or facsimile form, as the case may be, as their own signatures. That on the date of such signing and on the date hereof, we were and are the duly chosen, qualified and acting officers authorized to execute the Certificates, and holding the official titles set forth below opposite such signatures. We further certify that no litigation is pending or, to our knowledge, threatened in any court to restrain or enjoin the issuance or delivery of the Certificates, or the levy, collection or application of the ad valorem taxes or revenues pledged or to be pledged to pay the principal of and interest on the Certificates, or the pledge thereof, or in any way contesting or affecting the validity of the Certificates, the ordinance dated April 24, 1995, authorizing the issuance, sale and delivery of the Certificates (the "Ordinance"), or contesting the powers of the City or the authorization of the Certificates or the Ordinance, or contesting in any way the accuracy, completeness or fairness of the Official Statement. We further certify that the seal that has been impressed, or placed in facsimile, upon each of the Certificates is the legally adopted, proper and only official seal of the City, such official seal being impressed upon this certificate. We further certify that no petition or other request has been filed with or presented to any official of the City requesting that any of the proceedings authorizing the Certificates be submitted to a referendum or other election. a a We further certify that Paul Grohman is the City Manager of the City and that his signature as set forth below is genuine. mow ' City Manager, City of Pearland, Texas We further certify that the information and data contained in the General Certificate dated MAY 2 4 , 1995 remain true and correct as of this date. MAY 2 4 WITNESS OUR HANDS AND THE SEAL OF THE CITY this , 1995. I A R TITLE OF OFFICE Ir Mayor Pro Tern, City of Pearland, Texas CQCl-dr,4-pc,n744i Interim City Secretary, City of Pearland, Texas (CITY SEAL) The signatures of the above officers of the City of Pearland, Texas, are hereby certified to be genuine. PEARLAND STATE BANK Name of Bank Signature /Bank ffi r PEARLAND CASHIER City Title of Bank Officer (BANK SEAL) 0216130.01 049521/1417 NO ARBITRAGE CERTIFICATE I, the undersigned officer of the City of Pearland, Texas, a political subdivision of the State of Texas located within Galveston and Harris Counties (the "City"), make this certification for the benefit of all persons interested in the exclusion from gross income and certain other treatment for federal income tax purposes of the interest to be paid on the City's Combination Tax and Revenue Certificates of Obligation, Series 1995 (the "Certificates") in the aggregate principal amount of $5,000,000, which are being issued and delivered simultaneously with the delivery of this certificate (the "Certificate"). I do hereby certify as follows: 1. General. I am the duly chosen, qualified and acting officer of the City for the office shown below my signature. In such capacity, I am charged, along with others, with responsibility for issuing the Certificates. I am familiar with the facts, estimates and expectations certified herein, and I am duly authorized to execute and deliver this Certificate. I am familiar with the provisions of the ordinance adopted on August 9, 1994, authorizing the .• issuance of the Certificates (the "Ordinance"), and particularly the provisions thereof relating to the treatment of the Certificates and the interest thereon for federal income tax purposes. I am aware of the provisions of the Internal Revenue Code of 1986, as amended (the "Code"), including Sections 103 and 141 through 150 thereof, and the Treasury Regulations (the "Regulations") promulgated under the Code. This Certificate is being executed and delivered pursuant to the relevant provisions of the Code and Sections 1.148-0 through 1.148-11, 1.149(d)- 1, 1.149(g)-1, 1.150-1 and 1.150-2 of the Regulations. Certain terms used herein have the same meanings as given to those terms in the Code and the Regulations. Capitalized terms used in this Certificate (unless otherwise indicated herein) shall have the meanings ascribed to them in the Ordinance. 2. Reasonable Expectations. As an officer of the City responsible for issuing the Certificates, the undersigned hereby certifies, in good faith, that the City's expectations, as of the Issue Date (as defined herein), regarding the amount and use of the gross proceeds of the Certificates and other matters relevant to the treatment of interest on the Certificates for federal income tax purposes are accurately and completely stated herein, that all of such expectations and estimates stated in this Certificate are accurate, and that there are no facts, estimates or circumstances which would indicate that any of the expectations stated herein are not reasonable. 3. Descriptions of Governmental Purpose. The City is issuing the Certificates pursuant to the Ordinance to provide funds which will be used: (a) to provide all or part of the funds to pay contractual obligations to be incurred for certain street projects, renovations, improvements, materials, supplies, equipment and machinery for certain city buildings and facilities, including but not limited to the City's public library, acquisition and construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City (the "Project"); and (b) the costs of issuing the Certificates. 4. Proceeds of the Certificates. The sales proceeds from the sale of the Certificates will be $5,047,645.95 which represents the principal amount of the Certificates in the amount of $5,000,000, plus original issue premium in the amount of $128,401.45 and minus original issue discount in the amount of $80,755.50. 5. Use of Proceeds of the Certificates. The sales proceeds from the sale of the Certificates will be expended and applied by the City as follows: (a) Proceeds of the Certificates in an amount equal to $4,960,000.00 will be used by the City to pay the costs of the Project. (b) Proceeds of the Certificates in the amount of $47,645.95 represent the underwriter's compensation and will be retained by the underwriters from the sales proceeds as a cost to the City of issuing the Certificates. (c) Proceeds of the Certificates in the amount of approximately $40,000.00 -• will be disbursed within one year of the date hereof to pay the costs of issuing the Certificates. 6. Pre-Issuance Accrued Interest. In addition to the sale proceeds described in paragraph 5, the City will receive, upon the issuance of the Certificates, the amount of $18,653.64 representing interest on the Certificates accruing during the period from May 1, 1995, to the date hereof. Such amount will be deposited in the City's Combination Tax and Revenue Certificates of Obligation, Series 1995 Debt Service Fund (the "Debt Service Fund") and, along with all investment earnings therefrom, will be disbursed to pay interest on the Certificates on March 1, 1996, the first interest payment date on the Certificates. Further, because the amount of $18,653.64 represents accrued interest on the Certificates for a period of less than one year and will be spent to pay interest on the Certificates within one year from the Issue Date, such amount constitutes pre-issuance accrued interest on the Certificates and, as such, is not considered proceeds, but will, along with the earnings therefrom, constitute gross proceeds of the Certificates. Further, this amount and the earnings thereon will be received and spent for the payment of debt service on the Certificates within the same bond year (which begins on the Issue Date), and, consequently, will constitute a part of the Bona Fide Portion of _ the Debt Service Fund (as described in paragraph 17 below) and will be considered invested for temporary period, during which such amount and the earnings thereon may be invested at a yield materially higher than the yield on the Certificates. s 7. Investment Proceeds. The City has estimated the total amount of investment proceeds to be received with respect to the Certificates to be approximately $30,000.00. Such earnings on the investment of the proceeds of the Certificates described in paragraph 5(a) will be used in addition to the amounts described in paragraph 5(a) to pay the costs of the Project. The total cost of the Project is expected to equal or exceed the sum of the amount described in paragraph 5(a) and the investment earnings on the amount described in paragraph 5(a) which are 2 10. Temporary Period Requirements for the Certificates. (a) Time Test. The City has incurred or will incur within six months of the date hereof a binding obligation to one or more unrelated parties (not subject to contingencies within the City's or third party's control) pursuant to which the City is obligated to expend at least 5 percent of the net sale proceeds of the Certificates. (b) Expenditure Test. The City expects at least 85 percent of the original proceeds of the Certificates will have been expended prior to May 24, 1998 for costs of the Project. All original proceeds of the Certificates will be expended prior to May 24, 1998, will be invested on and after such date until final expenditure at a yield (as defined in paragraph 14) which is not materially higher than the yield on the Certificates, except as set forth in paragraph 17 below. (c) Due Diligence. The City expects that purchase of the Project will proceed with due diligence to completion and that the proceeds of the Certificates will be expended on the Project with reasonable dispatch. (d) Investment. Proceeds. The City expects that all amounts derived from the •• investment of monies received from the sale of the Certificates and from the reinvestment of such investment proceeds will be expended within three years from the date hereof or within one year after receipt of such investment income, whichever is later. All investment proceeds of the Certificates not expended prior to such date will be invested on and after such date until final expenditure at a yield which is not materially higher than the yield on the Certificates, except as provided in paragraph 17 below. r11. Flow of Funds. Under the Ordinance, the City is obligated to levy, assess and collect taxes and revenues in an amount sufficient to pay debt service on the Certificates. All taxes and revenues levied, assessed and collected by the City for or on account of the Certificates will be deposited into the Debt Service Fund. 12. Issue Price. For purposes of this Certificate, the issue price of the Certificates (the "Issue Price") is the aggregate of the Issue Price for each Certificate of the entire issue of Certificates determined as follows: (a) Except as provided in paragraph 12(b), the Issue Price of a Certificate is its Initial Offering Price at which such Certificate was reasonably expected on the Sale f Date (as defined below) to be sold to the Public (as defined below) if: (i) The Certificate is in fact offered to the public in a bona fide public offering of all the Certificates; and (ii) A substantial amount of the Certificates of the same maturity and otherwise identical to such Certificate are sold to the public at such Initial Offering Price. r" (b) If the Issue Price of a Certificate is not controlled or determined by the rules in paragraph 12(a), the Issue Price of such Certificate shall be determined on the basis of the Initial Offering Price to the Public (as defined below) at which price a substantial amount of the identical Certificates was sold to the public. (c) In no event shall the Issue Price of a Certificate exceed the fair market value of the Certificate as of the Sale Date. The term "public" shall not include bond houses, brokers and similar persons or organizations acting in the capacity of underwriters or wholesalers. The term "Sale Date" shall mean the first day on which there was a binding written contract for the sale or exchange of the Certificates by the City on specific terms that were not later modified or adjusted in any material respect. In the case of the Certificates, the Sale Date is April 24, 1995. The term "Issue Date" shall mean the first day on which there is a physical delivery of the written evidence of the Certificates in exchange for the purchase price, (but not earlier than the first day on which interest begins to accrue on the Certificates for federal income tax purposes). In the case of the Certificates, the Issue Date is May 24, 1995. Based on the foregoing and on the Certificate Regarding Issue Price attached hereto as Exhibit A, the Issue Price of the Certificates, plus pre-issuance accrued interest, is $5,066,299.59. •• 13. Other Issues. During the period of time beginning 15 days prior to the Sale Date and ending 15 days after the Issue Date, neither the City nor any related party of the City, has sold or issued any obligations which the City reasonably expects will be paid from the same source of funds as the Certificates and which have been or will be sold or issued pursuant to the same plan of financing as the Certificates. 14. Yield on the Certificates. For purposes of this Certificate, the term "yield" shall have the meaning ascribed to it in Section 148(h) of the Code and the Regulations in effect thereunder and, when used with respect to the Certificates, shall mean that interest rate which when used as a discount factor to compute the present value as of the Issue Date of all scheduled payments of principal of and interest on the Certificates produces an amount equal to (i) the present value (using the same discount rate) of the Issue Price of the Certificates, plus (ii) pre-issuance accrued interest on the Certificates as of the Issue Date. The yield on the Certificates shall not take into account or reflect any underwriters' discount or cost of issuance of the Certificates. For purposes hereof, yield is and shall be calculated on the basis of a 360- day year with interest compounded semi-annually. The yield on the Certificates is calculated on the basis of the final maturity date because, in the case of the Certificates subject to optional redemption, except as provided above, (i) the City has no present intention to call the Certificates for optional redemption, (ii) no Certificate is callable at any time for a price less than par plus accrued interest, and (iii) the Underwriter has represented on Exhibit A hereto that the Issue Price of each such callable Certificate is not greater than par plus accrued interest. No Certificate is subject to mandatory early redemption. 5 s The insurance premium is separately stated from all other fees or charges payable to the City or the insurer. It is reasonably expected that Capital Guaranty Insurance Company ("Capital") as guarantor, will not be called upon to make any payment with respect to the Certificates for which Capital will not be reimbursed immediately or upon commercially reasonable repayment terms (during a workout period that is not unreasonably long) for any payment under the Capital guarantee. All payments to Capital for any nonguarantee service performed by the guarantor will be fully and adequately compensated separate and apart from the guarantee fees described above based on a comparison to payments that would be charged for the nonguarantee service if such service was performed by a person other than a guarantor. Based on a representation of the underwriter set forth in Exhibit A hereto (a) the insurance premium does not exceed a reasonable charge for the transfer of credit risk taking into account payments charged by guarantors in comparable transactions (including transactions in which a guarantor has no involvement other than as a guarantor) and (b) the present value of the debt service savings expected to be realized as a result of such insurance exceeds the present value of the insurance premium discounted at a rate equal to the yield on the Certificates which results assuming recovery of the insurance premium. The yield on the Certificates, calculated in this manner and based on the information set forth in the Certificate Regarding Issue Price, attached hereto as Exhibit A, is 5.571565 percent. 15. The Debt Service Fund. The proceeds from all taxes and revenues levied, assessed and collected for and on account of the Certificates and all investment earnings on amounts in the Debt Service Fund will be deposited promptly into the Debt Service Fund. The Debt Service Fund will be used primarily to achieve a proper matching of revenues and debt service on the Certificates within each Certificate year. All amounts which will be used to pay principal of and interest on the Certificates with 13 months of the date of deposit in the Debt Service Fund and which will be depleted annually, except for a reasonable carryover amount not to exceed the greater of (i) one year's earnings on the Debt Service Fund or (ii) one-twelfth of the annual debt service on the Certificates, will constitute a bona fide debt service fund component of the Debt Service Fund (the "Bona Fide Portion"). All amounts on deposit in the Debt Service Fund from time to time in excess of the Bona Fide Portion thereof and all amounts t in the Debt Service Fund and not spent within 13 months of the date of deposit therein (the i "Reserve Portion") shall be treated separately for purposes of this Certificate. The expenditure of money deposited in the Debt Service Fund shall be accounted for on the basis of such method Po of accounting as properly adopted and consistently applied by the City for tax purposes. Amounts on deposit from time to time in the Bona Fide Portion and in the Reserve Portion are allocable between the Certificates and any other obligations of the City the payment of which may be secured by the Debt Service Fund and shall be allocated under such method as properly adopted and consistently applied by the City for tax purposes. So long as any of the Certificates are outstanding, the portion of the Reserve Portion allocable to the Certificates is not expected to exceed the lesser of (i) ten percent of the Issue Price, (ii) the maximum annual debt service on the Certificates or (iii) 125 percent of the average annual debt service on the Certificates. If, however, the balance of the Reserve Portion should ever exceed the limitation specified in the preceding sentence, such excess shall be invested at a yield not in excess of the yield on the Certificates. a a 16. No Other Sinking Funds. Other than the Debt Service Fund, there are no other funds or accounts comprised of investment property established by and on behalf of the City (a) which are expected to be used, or expected to generate earnings to be used, to pay debt service on the Certificates, or which are reserved or pledged as collateral for payment of debt service on the Certificates and (b) for which there is reasonable assurance that amounts therein will be available to pay debt service on the Certificates if the City encounters financial difficulties. Use of amounts in the Debt Service Fund are described above. There is no other fund established, or to be created or established, which would be treated as a sinking fund with respect to the Certificates. Use of amounts in the Debt Service Fund are described above. There is no other fund established, or to be created or established, which would be treated as a sinking fund with respect to the Certificates. 17. Minor Portion. The City expects that the gross proceeds of the Certificates, including all proceeds received with respect to the Certificates and all investment proceeds received on such amounts, and all other amounts pledged or anticipated to be used to pay principal of and interest on the Certificates, other than amounts representing a portion of the Bona Fide Portion of the Debt Service Fund, will be expended in accordance with paragraphs 10 and 15 above. To the extent that such amounts remain unexpended or are otherwise on hand following the periods set forth in paragraphs 10 and 15 above exceeds the amount specified in paragraph 15, the City will invest such amounts (other than a minor portion not exceeding the lesser of 5 percent of the proceeds of the Certificates or $100,000 in the aggregate) at a yield not materially higher than the yield on the Certificates. 18. Qualified Tax-Exempt Obligations. Section 265 of the Code permits designation of governmental obligations such as the Certificates as "qualified-tax-exempt obligations." The Certificates have been, or are hereby, designated by the City as "qualified tax-exempt obligations" for purposes of Section 265(b)(3) of the Code. The Certificates are not private activity bonds within the meaning of Section 141(a) of the Code. The City (and all entities related to the City) does not reasonably expect to issue, and will not designate, tax-exempt obligations, including the Certificates, in an aggregate amount (based in each case on the higher of the principal amount or the issue price) in excess of $10,000,000 during the calendar year 1995. 19. Identification of Replacement Proceeds. Notwithstanding the expectations of the City as stated above in paragraph 8 above, the City will (at all times while the Certificates are outstanding) identify all replacement proceeds with respect to the Certificates, including any sinking fund created for repayment of the principal or interest on the Certificates or any other amounts held in any fund of the City reasonably expected by the City to be used to pay principal or interest on the Certificates. If the City identifies any replacement proceeds and determines that a temporary period pursuant to Section 1.148-2(e) of the Regulations is not applicable to such replacement proceeds, the City will limit the yield on the investment of such replacement proceeds to the yield on the Certificates until such proceeds are treated as spent in accordance with the Regulations. The City acknowledges that failure to properly identify replacement proceeds and account for the investment and expenditure thereof as required by the Regulations may result in interest on the Certificates being includable in the gross income of the holders of the Certificates. 7 20. Compliance with Rebate Requirements. The City has covenanted in the Ordinance that it will take all necessary steps to comply with the requirement that rebatable arbitrage earnings on the investment of the gross proceeds of the Certificates, within the meaning of Section 148(f) of the Code, be rebated to the federal government. Specifically, the City will (i) maintain separate records regarding the amount and timing of disbursements of proceeds of the Certificates, (ii) maintain records regarding the investment of the gross proceeds of the Certificates as may be required to calculate the amount earned on the investment of the gross proceeds of the Certificates which are part of a reasonably required reserve or replacement fund separately from records of amounts in other funds or accounts maintained for the Certificates, amounts on deposit in the funds and accounts of the City allocable to other bond issues of the City or moneys which do not represent gross proceeds of any bonds of the City, (iii) calculate at such times as required by applicable Regulations, the rebatable amount earned from the investment of the gross proceeds of any bonds of the City, (iii) calculate at such times as required by applicable Regulations, the rebatable amount earned from the investment of the gross proceeds of the Certificates which are part of a reasonably required reserve or replacement fund, and (iv) pay, not less often than every fifth anniversary date of the delivery of the Certificates or on such other dates as permitted or required by applicable Regulations, all amounts required to be rebated and all penalties required to be paid to the federal government. The City acknowledges that for purposes of compliance with Section 148 of the Code, gross proceeds of ••. the Certificates must be accounted for on the basis of a reasonable, consistently applied method of accounting, not employed in whole or in part as an artifice or device. The City will employ accountants or other persons with expertise in performing the rebate calculations as necessary to insure compliance with the Code. The City will employ legal counsel as necessary to resolve any interpretive issues involved in complying with the rebate requirements of the Code. Further, the City will not indirectly pay any amount otherwise payable to the federal government pursuant to the foregoing requirements to any person other than the federal government by entering into any investment arrangement with respect to the gross proceeds of the Certificates. In the event that the City fails to comply with the rebate requirements of the Code, the City agrees to take all steps available under the Code to bring the Certificates into compliance with the Code; such steps include paying any penalty, interest, or other amounts which will allow the City to return to compliance with the rebate requirements of the Code. If the City is required to pay rebate ±' or other amounts, such as penalties and interest, to the United States with respect to the Certificates pursuant to Section 148(f) of the Code in order to prevent the Certificates from constituting arbitrage bonds or being otherwise classified or treated such that interest on the Certificates would not be excludable from the gross income of the holders thereof for federal 4 income tax purposes, the City will timely make such payments from available funds of the City and the City reasonably expects that it will have the ability to make such payments from available funds of the City in the event such payments become necessary. The undersigned reasonably expects that the City will fulfill its covenants and representations in this regard. 21. Not a Refunding. No portion of the proceeds of the Certificates are expected to be used to pay any interest on or principal of any issue of governmental obligations other than the Certificates. 8 1 a a 22. Not a Reimbursement. No portion of the proceeds of the Certificates will be allocated to, or otherwise used to reimburse, any expenditure paid by the City, either actually or constructively, prior to the Issue Date. 23. No Change in Use. The City does not expect to dispose of any portion of any a project related to the Certificates, or to change the use of the proceeds of the Certificates while any of the Certificates are outstanding. 24. Not a Hedge Bond. Not more than 50 percent of the proceeds of the Certificates will be invested in non-purpose investments (as defined in Section 148(f)(6)(A) of the Code) having a substantially guaranteed yield for four years or more within the meaning of Section 149(g)(3)(A)(ii) of the Code, and the City reasonably expects that at least 85 percent of the spendable proceeds of the Certificates will be used to carry out the governmental purposes of the Certificates within the three-year period beginning on the date the Certificates were issued. 25. No Abusive Arbitrage Device. The Certificates are not and will not be a part •• of an issue in which an abusive arbitrage device (as defined in Section 1.148-10(a) of the Regulations) is used. Without limiting the foregoing, the Certificates are not and will not be a part of a transaction or series of transactions that attempts to circumvent the provisions of Section 148 of the Code and the Regulations, by (i) enabling the City to exploit the difference between tax-exempt and taxable interest rates to gain a material financial advantage, and (ii) increasing the burden on the market for tax-exempt obligations. In this regard, the City a issued the Certificates for the primary purpose of accomplishing the bona fide governmental purposes set forth in paragraph 3 of this Certificate. Based on all the facts and circumstances, the City has not issued the Certificates in an amount higher than is reasonably necessary to accomplish the governmental purposes of the Certificates, the City has not issued the Certificates earlier than is reasonably necessary to accomplish the governmental purposes of the Certificates and the City is not allowing the Certificates to remain outstanding longer than is reasonably necessary to accomplish the governmental purposes of the Certificates. The City would have issued the Certificates regardless of any arbitrage benefit which it may realize in connection with the Certificates. In fact, the City reasonably expects that even if the Certificates were not tax- exempt obligations and if market rates of interest on taxable and tax-exempt obligations were equal to each other and to the rates at which the Certificates are in fact now being issued, the City would have issued the Certificates, notwithstanding the loss of any opportunity to borrow at lower tax-exempt rates and invest at higher taxable rates. (a) No Impermissible Sinking Fund. No portion of the Certificates has a maturity determined primarily for the purpose of creating a sinking fund with respect to the Certificates the yield on which will be blended with the yield on the investment of other proceeds of the Certificates to reduce the negative arbitrage related to such investment. (b) No Window Refunding. No portion of the Certificates has been structured with the purpose of making available released revenues that will allow the City to avoid transferred proceeds, to invest such released revenues at a yield materially a 9 r i higher than the yield on the Certificates or to pay principal and interest on another issue of obligations of the City. (c) No Sale of a Conduit Loan. No portion of the gross proceeds of the Certificates has been or will be used to acquire, finance or refinance a conduit loan. 26. No Arbitrage. On the basis of the foregoing facts, estimates and circumstances, it is expected that the proceeds of the Certificates will not be used in a manner that would cause any of the Certificates to be an "arbitrage bond" within the meaning of Section 148 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 would materially change such expectations. WITNESS MY HAND, this 24th day of May, 1995. - CITY OF PEARLAND, TEXAS By: _ Paul Grohman City Manager EXHIBIT A -- Certificate Regarding Issue Price EXHIBIT B -- Certificate of Financial Advisor ,� 0228958.01 059522/1844 w 10 r EXHIBIT A r CERTIFICATE REGARDING ISSUE PRICE The undersigned hereby certifies with respect to the sale of$5,000,000 City of Pearland,Texas Combination Tax pi and Revenue Certificates of Obligation, Series 1995 (individually, a "Certificate," and collectively, the "Certificates"), as follows: 1. The undersigned is a duly authorized representative of the underwriter or of the manager of the r syndicate of underwriters that purchased the Certificates from the City of Pearland(the"City")pursuant to a competitive bid sale. (Such underwriter or syndicate of underwriters is referred to herein as the"Underwriters.") In this capacity,the undersigned is familiar with the facts stated herein. 2. The term "Initial Offering Prices" means the respective initial offering prices (exclusive of accrued interest)for the Certificates of each maturity(stated in term of dollars or as a percent of par) as set forth in the following table. YEAR OF MATURITY PRINCIPAL INTEREST INITIAL r (MARCH 1) AMOUNT RATE OFFERING PRICE 1997 $130,000 Z. % cr.� 1998 140,000 7.,f % V.00 r 1999 150,000 7 po % el. �v 2000 155,000 Zov % Y, o 2001 165,000 7.0o % 5-90 Ps 2002 175,000 -7.po % TQ9 2003 185,000 '-7. 2 % V-70�� 2004 200,000 '7 Da % c/;"/tv r 2005 210,000 ,(72 % .f,,/o 2006 225,000 J 7i(, % yo 2007 240,000 ,j^lo % .r:3 0 ,^ 2008 255,000 .13o % ✓l4Fv 2009 270,000 .1;Vo % a .S 2010 500,000 .rr "/a /.6� 2011 500,000 . 0 o T7o 2012 500,000 .T?o % J-.to 2013 500,000 ,[iv % ,j"::yo 2014 500,000 5 V % t.7:77o r 3. The term"Sale Date" means the first day on which there was a binding contract in writing for the sale of the Certificates by the City to the Initial Purchasers on specific erms that were not later modified or adjusted in any r material respect. In the rise of the Certificates,the Sale Date is r-,/ 1995. 4. The term"Issue Date"means the first day on which there is physical delivery of the written evidence of 1010 the Certificates in exchange for the purchase price(but not earlier than the day interest on the Certificates begins to accrue for federal income tax purposes). In the case of the Certificates,the Issue Date is /-/wy Z f , 1995. 5. The term "Public" shall not include bond houses,brokers, and similar persons or organizations acting in the capacity of wholesalers or underwriters. 6. Based on the actual facts and reasonable expectations in existence on the Sale Date,the Initial Offering r~ Price for each Certificate: a. Represented as the price (payable in cash, with no other consideration being included, and exclusive of accrued interest), at which the Underwriters reasonably expected, as of the Sale Date, each such r Certificate would be sold to the Public;and r + b. Did not exceed what the Underwriters believed to be the respective fair market value of each such Certificate as of the Sale Date. 7. The Underwriters have purchased the Certificates for contemporaneous sale to the Public and not for investment for their own account. Each of the Certificates has actually been offered to the Public at its respective Initial Offering Price in a bona fide offering of all the Certificates and, as of the Issue Date, a substantial amount of the Certificates(at least 10 percent)of each maturity has been sold to the Public in arm's length transactions for cash prices (with no other consideration being included). Of the Certificates sold, none were sold at prices other than the respective Initial Offering Prices for such Certificates,plus accrued interest. 8. The accrued interest on the Certificates as of the Issue Date is$18 ,6 5 3 . 6 4 The aggregate of the respective Initial Offering Prices of all of the Certificates, exclusive of accrued interest and without adjustment for any costs of issuance,is$_5 , 0 4 7 ,6 4 5 .9 5 9. The Underwriters [have] [have not] purchased bond insurance or another form of credit enhancement .M ("Guarantee")securing the payment of the principal of,or interest on, any of the Certificates. If any Guarantee has been purchased with respect to all or any portion of the Certificates-- a. The provider of the Guarantee is ti�0i 74 / (; (the"Guarantor"). + b. The fee or premium paid to the Guarantor for the Guarantee is $ /2,oa) (the "Premium"). The Premium is set forth in the Guarantor's commitment,does not exceed a reasonable charge for the transfer of the credit risk provided by the Guarantee,and does not include any direct or indirect payment or compensation (such as rating agency fees) for any service other than the transfer of such credit risk. The Guarantor has not provided any service other than the Guarantee, except for any such service for which the Guarantor has charged a reasonable,arm's length price which will be in addition to, and stated separately from, the Premium. No portion of the Premium is refundable upon the redemption or defeasance of any of the Certificates. c. As a result of the Guarantee, the interest rates on the Certificates, as set forth above, are less than those which would have been necessary in order to sell the Certificates at the respective Initial Offering Prices without the Guarantee. The present value of such interest savings expected to result from the Guarantee is .. greater than the present value of the Premium. In both cases,such present values have been determined as of the Issue Date using the yield on the Certificates(computed for this purpose by treating the Premium as additional interest on the Certificates)as the discount rate. We understand that the City will rely on the above in making certain representations to Mayor,Day,Caldwell& Keeton,L.L.P.,Bond Counsel to the City,and in complying with the conditions of the Internal Revenue Code of 1986,as amended, and the Treasury Regulations in effect thereunder, necessary for interest on the Certificates to be and remain excludable from gross income for federal income tax purposes. EXECUTED and DELIVERED as of and on May 24 _, 1995. Very truly yours, UNDERWRITERS NationsBanc Capital Markets, Inc. Name of Underwriter or Manager of Syndicate .. � 1 By: � IXAir1J- ( ry � C l Barnes h J Name: Title: Investment Officer '"' a EXHIBIT B CERTIFICATE OF FINANCIAL ADVISOR The undersigned hereby certifies with respect to the sale of$5,000,000 City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995 (individually, a "Certificate", and collectively, the "Certificates"), as follows: The undersigned has acted as financial advisor to the City of Pearland, Texas (the "City") with respect to the Certificates. In the capacity as financial advisor, the undersigned is familiar with the facts stated herein and represents as follows. With respect to the yield on the Certificates: 1. The term "yield" shall have the meaning ascribed to it in Section 148(h) of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations in effect thereunder, and, when used with respect to the Certificates, shall mean that interest a rate which when used as a discount factor to compute the present value as of the Issue Date of all scheduled payments of principal of and interest on the Certificates produces an amount equal to (i) the present value (using the same discount rate) of the Issue Price a of the Certificates, plus (ii) pre-issuance accrued interest on the Certificates as of the Issue Date. Yield on the Certificates shall not take into account or reflect any underwriters' discount, cost of issuance of the Certificates or costs of carrying or repaying the Certificates. For purposes hereof, yield is and shall be calculated on the basis of a 360-day year with interest compounded semi-annually. 2. The yield is calculated on the basis of the final maturity date of each of the Certificates because, in the case of the Certificates subject to optional redemption, (i) no present intention exists to call the Certificates for optional redemption, (ii) no Certificate is callable at any time for a price less than par plus accrued interest, and (iii) the Issue Price of each callable Certificate is not greater than par plus accrued interest. No Certificate is subject to mandatory early redemption. 3. The insurance premium is separately stated from all other fees or charges payable to the City or the insurer. It is reasonably expected that Capital as guarantor, will not be called upon to make any payment with respect to the Certificates for which Capital will not be reimbursed immediately or upon commercially reasonable repayment terms (during a workout period that is not unreasonably long) for any payment under the Capital guarantee. All payments to Capital for any nonguarantee service performed by the guarantor will be fully and adequately compensated separate and apart from the guarantee fees described above based on a comparison to payments that would be charged for the nonguarantee service if such service was performed by a person other than a guarantor. The insurance premium does not exceed a reasonable charge for the transfer of credit risk taking into account payments charged by guarantors in comparable transactions (including transactions in which a guarantor has no involvement other than as a guarantor), and the present value of the debt service savings expected to be realized as a result of such insurance exceeds the present value of the insurance premium Page B-1 of 2 discounted at a rate equal to the yield on the Certificates which results assuming recovery of the insurance premium. 4. Based on the foregoing, the yield on the Certificates calculated in this manner is 5.571565 percent. r We understand that the City will rely on the above in making certain representations to rMayor, Day, Caldwell & Keeton, L.L.P., Bond Counsel to the City, and in complying with the conditions of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations in effect thereunder, necessary for interest on the Certificates to be and remain excludable from rgross income for federal income tax purposes. EXECUTED and DELIVERED as of and on May 24, 1995. Very truly yours, rFINANCIAL ADVISOR RAUSCHER PIERCE REFSNES, INC. rBy: V2-(,„4- Frank J. Ildebrando Senior Vice President r 0228958.01 059523/1525 r r r r Page B-2 of 2 r Form 8038-G Information Return for Tax-Exempt Governmental Obligations ► Under Internal Revenue Code section 149(e) OMB No. 1545-0720 ima (Rev. May 1993) ► See separate Instructions. Uevan o1 the ry xy Internal (Use Form 8038-GC if the issue price is under$100,000.) Revenue Service Part I Reporting Authority If Amended Return, check here 10. 111 r 1 Issuer's name 2 Issuer's employer identification number CITY OF PEARLAND, TEXAS 74 6028909 3 Number and street(or P.O. box if mail is not delivered to street address) Room/suite 4 Report number 3519 LIBERTY DRIVE G19 95 - 1 5 City,town,state, and ZIP code 6 Date of issue PEARLAND, TEXAS 77581 MAY 24, 1995 7 Name of Issue $5,000,000 CITY OF PEARLAND, TEXAS COMBINATION TAX 8 CUSIP Number AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 1995 704862ML2 Part II Type of Issue (check applicable box(es) and enter the issue price) Issue price r9 ❑ Education (attach schedule-see instructions) $ 10 ❑ Health and hospital (attach schedule see instructions) 11 ❑ Transportation 12 ❑ Public safety 13 ❑ Environment (including sewage bonds) 14 ❑ Housing . 15 ❑ Utilities AM 16 El Other. Describe (see Instructions) 0-STREET IMPROVEMENTS, LIBRARY EXPANSION, 5 047 594.55 17 If obligations are tax or other revenue anticipation bonds, check box ► DAND DRAINAGE 18 If obligations are in the form of a lease or installment sale, check box ► ❑ IMPROVEMENTS A "' Part III Description of Obligations (a) (b) (c) (d) (e) (g) Maturity date Interest rate Issue price Stated redemption Weighted Yield Net interest price at maturity average maturity cost 19 Final maturity. 9/30/2014 5.00 % 449,2.95.00 500,000.00 , /4 20 Entire issue . ����A 5,047,594.55 5,000,000.00 12,448113vz 5.571 %5.601798% Part IV Uses of Original Proceeds of Bond Issue (including underwriters' discount) 592 21 Proceeds used for accrued interest 21 19,464.67 22 Issue price of entire issue (enter amount from line 20, column (c)) . . . . . . . _ _ . 22 5,047,594.55 23 Proceeds used for bond issuance costs(including underwriters' discount) . 23 75,594.55 I 24 Proceeds used for credit enhancement 24 12,000.00 25 Proceeds allocated to reasonably required reserve or replacement fund . 25 - 0 - 26 Proceeds used to refund prior issues 26 - 0 - 27 Total (add lines 23 through 26) 27 87,594.55 P, 28 Nonrefunding proceeds of the issue (subtract line 27 from line 22 and enter amount here). . 28 4,960,000.00 Part V Description of Refunded Bonds (complete this part only for refunding bonds) N/A 29 Enter the remaining weighted average maturity of the bonds to be refunded ► years 30 Enter the last date on which the refunded bonds will be called ► 31 Enter the date(s) the refunded bonds were issued 0- Part VI Miscellaneous 32 Enter the amount of the state volume cap allocated to the issue ► N/A WM 33 Enter the amount of the bonds designated by the issuer under section 265(b)(3)(B)(ixlll) (small issuer exception) ► 5,047,594.55 34 Pooled financings: am a Enter the amount of the proceeds of this issue that are to be used to make loans to other governmental units ► N/A b If this issue is a loan made from the proceeds of another tax-exempt issue, check box ► ❑ and enter the name of the issuer ► and the date of the issue ► 35 If the issuer has elected to pay a penalty in lieu of rebate, check box ► ❑ '. Underpenalties of perjury,I declare that I have examined this return and accompanyingschedules and statements,and to the best of myknowledge P n ry• - 9 and belief,they are true,correct,and complete. Please / r Sign Here iill'' 3J clel�J+ � Paul Grohman, City Manager Signature of officer Date Type or print name and title For Paperwork Reduction Act Notice, see page 1 of the Instructions. Cat. No.63773S Form 8038-G (Rev.5-93) 'U.S.Government Printing Office: 1993—343-034/80150 CERTIFICATE OF ASSESSED VALUATION — THE STATE OF TEXAS § COUNTIES OF BRAZORIA AND HARRIS § CITY OF PEARLAND § I, Rubye Jo Knight, the duly appointed, qualified and acting Tax Assessor-Collector of — the City of Pearland, Texas (the "City"), do hereby certify that the following is a true and correct statement of the assessed value of taxable property within the City, as shown by the duly approved tax rolls for the tax year 1994 as of the date shown below, which are the last approved tax rolls for the City on file in my office, to wit: • $ 7811 ? 1, oli WITNESS MY HAND this 27th day of April, 1995 - — Tax Ass sor- ollector City of Pearland, Texas — a a a a — 0216131.01 049526/1435 CLOSING CERTIFICATE THE STATE OF TEXAS § COUNTIES OF BRAZORIA AND HARRIS § CITY OF PEARLAND § We, the undersigned, Mayor and City Manager of the City of Pearland, Texas (the "City"), acting solely in our respective official capacities, hereby certify with respect to the $5,000,000 City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995 (the "Certificates"), as follows: 1. We certify that the ordinance of the City Council of the City authorizing the issuance of the Certificates, dated April 24, 1995 (the "Ordinance") and the Paying Agent/Registrar Agreement have not been amended, modified, supplemented or repealed, except as may have been agreed to by the Purchaser and are in full force and effect. 2. We further certify that: (i) the City has authorized, by all necessary action, the execution and delivery or receipt and due performance of the Ordinance, Paying Agent/Registrar Agreement, Certificates, Official Statement and any and all such other agreements and documents as may be required to be executed and delivered or received by the City in order to carry out, give effect to and consummate the transactions contemplated hereby and by the Ordinance and Official Statement and the City Council has authorized, by all necessary action, the adoption of the Ordinance; (ii) except to the extent disclosed in the Official Statement, no litigation is pending or, to the best of our knowledge, threatened in any court to restrain or enjoin the issuance, sale or delivery of the Certificates, or the levy, collection or application of the ad valorem taxes or revenues pledged or to be pledged to pay the principal of and interest on the Certificates, or the pledge thereof, or in any way contesting or affecting the validity of the Certificates, or the Ordinance, or contesting the powers of the City or the authorization of the Certificates or the Ordinance, or contesting in any way the accuracy, completeness or fairness of the Official Statement; (iii) the adoption of the Ordinance by the City Council and the execution and delivery of the Certificates, the Official Statement and the other agreements contemplated by the Official Statement to be executed and delivered by the City or the City Council under the circumstances contemplated thereby, and the compliance by the City and the City Council with the provisions thereof will not conflict with or constitute on the part of the City or the City Council a breach of or a default under any existing law, court or administrative regulation, decree or ordinance or any agreement, indenture, mortgage, lease or other instrument to which the City or the City Council is subject or by which the City, the City Council or any of the City's properties is bound; (iv) the information set forth in the Official Statement is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and (v) to the best of our knowledge, no event affecting the City has occurred since the date of the Official Statement which should be disclosed in the Official Statement for the purposes for which it is to be used or which it is necessary to disclose therein in order to make the statements and information therein not misleading in any respect. (vi) there has not been any material and adverse change in the affairs or financial condition of the City since September 30, 1994, the latest date as to which audited financial information is available. EXECUTED ON BEHALF OF THE CITY as of MAY 2 4 1995 CITY OF PEARL , TEXAS David L. Smith, Niayor Pro Tem Paul Grohman, City Manager 0216673.01 049521/1414 CERTIFICATE OF CITY MANAGER CITY OF PEARLAND, TEXAS THE STATE OF TEXAS § COUNTIES OF BRAZORIA AND HARRIS § CITY OF PEARLAND § This certificate is made for the benefit of all persons interested in the City of Pearland, Texas Combination Tax and Revenue Certificates of Obligations, Series 1995, now in the process of issuance. I hereby certify as follows: 1. That I am City Manager for the City of Pearland, Texas (the "City") and as such am familiar with the matters and facts set out in this certificate. 2. Nothing has come to my attention that causes me to believe that during the period from September 30, 1994, to May 24, 1995 (the "Closing") there has been any material adverse change in the financial affairs of the City from that set forth in the audited financial statements of the City as of September 30, 1994, and included in the Official Statement dated as of April 24, 1995. WITNESS MY HAND, this MAY 2 4 , 1995. Paul Grohman, City anager City of Pearland, Texas i 0216140.01 049521/1415 CAPITALARAINITY CERTIFICATE OF CAPITAL GUARANTY INSURANCE COMPANY Reference is made to (i) that certain Municipal Bond Guaranty Insurance Policy dated the date hereof (the "Municipal Bond Guaranty Insurance Policy" ) issued by Capital Guaranty Insurance Company, a corporation organized under the laws of Maryland ( "Capital Guaranty" ) , which Municipal Bond Guaranty Insurance Policy secures, pursuant to its terms, payment of the principal of and interest on $5, 000, 000 in aggregate principal amount of City of Pearland, Texas (Brazoria and Harris Counties) , Combination Tax and Revenue Certificates of Obligation, Series 1995, dated May 1, 1995 (the "Obligations" ) and (ii) that certain Official Statement of the City of Pearland, Texas dated April 24, 1995 (the "Official Statement" ) , relating to the issuance and sale of the Obligations . Having examined the Municipal Bond Guaranty Insurance Policy and certain statements contained in the Official Statement, the undersigned Alan F. Morcos, Vice President and Controller of Capital Guaranty, hereby certifies that the statements contained in the Official Statement, set forth under the caption "Municipal Bond Insurance, " in Appendices D and E and on the cover page of the Official Statement, insofar as such statements relate to Capital Guaranty, accurately and fairly present the information purported to be shown and, insofar as such statements describe Capital Guaranty and the Municipal Bond Guaranty Insurance Policy, accurately and fairly describe Capital Guaranty and the Municipal Bond Guaranty Insurance Policy. IN WITNESS WHEREOF, the undersigned has executed this certificate as of the 24th day of May, 1995 . CAPITAL GUARANTY I SURANCE COMPANY By: Alan F. Morcos Title : Vice President and Controller MAYOR, DAY, CALDWELL £3 KEETON, L.L.P 700 LOUISIANA, SUITE 1900 HOUSTON,TEXAS 77002-2778 (713)225-7000 100 CONGRESS AVENUE TELECOPIER(713)225-7047 SUITE 1500 AUSTIN,TEXAS 78701-4042 (512)320-9200 TE LECOPI ER(512)320-9292 May 24, 1995 WE HAVE ACTED as Bond Counsel for the City of Pearland, Texas (the "City") in connection with an issue of certificates of obligation (the "Certificates") described as follows: CITY OF PEARLAND, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 1995, dated May 1, 1995, in the aggregate principal amount of $5,000,000, maturing on March 1 in each year from 1997 through and including 2014. The Certificates are issuable in fully registered form only, in denominations of $5,000 or integral multiples thereof, bear interest, are subject to redemption prior to maturity and may be transferred and exchanged as set out in the Certificates and in the ordinance (the "Ordinance") adopted by the City Council of the City authorizing their issuance. WE HAVE ACTED as Bond Counsel for the sole purpose of rendering an opinion with respect to the legality and validity of the Certificates under the Constitution and laws of the State of Texas and with respect to the exclusion of interest on the Certificates from gross income under federal income tax law. In such capacity we have examined the Constitution and laws of the State of Texas; federal income tax law; and a transcript of certain certified proceedings pertaining to the issuance of the Certificates, as described in the Ordinance. The transcript con- tains certified copies of certain proceedings of the City; certain certifications and representations and other material facts within the knowledge and control of the City, upon which we rely; and certain other customary documents and instruments authorizing and relating to the issuance of the Certificates. We have also examined executed Certificate No. R-1 of this issue. WE HAVE NOT BEEN REQUESTED to examine, and have not investigated or verified, any original proceedings, records, data or other material, but have relied upon the transcript of certified proceedings. 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 Certificates. Our role in connection with the City's Official Statement prepared for use in connection with the sale of the Certificates has been limited as described therein. BASED ON SUCH EXAMINATION, it is our opinion as follows: (1) The transcript of certified proceedings evidences complete legal authority for the issuance of the Certificates in full compliance with the Constitution and laws of the State of Texas presently in effect; the Certificates constitute valid and legally binding obligations of the City enforceable in accor- dance with the terms and conditions thereof, except to the extent that the rights and remedies of the owners of the Certificates may be limited by laws heretofore or hereafter enacted relating to bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the rights of creditors of political subdivisions and the exercise of judicial discretion in appropriate cases; and the Certificates have been authorized and delivered in accordance with law; and (2) The Certificates are payable, both as to principal and interest, from the receipts of an annual ad valorem tax levied, within the limits prescribed by law, upon taxable property located within the City, which taxes have been pledged irrevocably to pay the principal of and interest on the Certificates; and (3) The revenues to be derived from the operation of the City's waterworks and sanitary sewer system after the payment of all operation and maintenance expenses thereof(the "Net Revenues"), in an amount not to exceed $10,000, are pledged to the payment of the principal of and interest on the Certificates, to the extent that ad valorem taxes may ever be insufficient or unavailable for said purpose; provided, however, that such pledge is junior and subordinate in all respects to the pledge of Net Revenues to the payment of any obligation of the City, whether authorized heretofore or hereafter, which the City designates as having a pledge senior to the pledge of Net Revenues to the payment of the Certificates. The City has reserved the right to issue, for any lawful purpose at any time, in one or more installments, bonds, certificates of obligation and other obligations of any kind secured by a pledge of the Net Revenues that may be prior and superior in right to, on a parity with, or junior and subordinate to the pledge of Net Revenues securing the Certificates. ALSO BASED ON OUR EXAMINATION AS DESCRIBED ABOVE, it is our further opinion that, subject to the restrictions hereinafter described, interest on the Certificates is excludable from gross income of the owners thereof for federal income tax purposes under existing law and is not subject to the alternative minimum tax on individuals or, except as hereinafter described, corporations. The opinion set forth in the first sentence of this paragraph is subject to the condition that the City comply with all requirements of the Internal Revenue Code of 1986, as amended (the "Code"), that must be satisfied subsequent to the issuance of the Certificates in order that interest thereon be, or continue to be, excluded from gross income for federal income tax purposes. The City has covenanted in the Ordinance to comply with each 2 such requirement. Failure to comply with certain of such requirements may cause the inclusion of interest on the Certificates in gross income for federal income tax purposes to be retroactive to the date of issuance of the Certificates. The Code and the existing regulations, rulings and court decisions thereunder, upon which the foregoing opinions of Bond Counsel are based, are subject to change, which could prospectively or retroactively result in the inclusion of the interest on the Certificates in gross income of the owners thereof for federal income tax purposes. INTEREST ON all tax-exempt obligations, including the Certificates, owned by a corporation (other than an S corporation, a regulated investment company, a real estate investment trust (REIT) or a real estate mortgage investment conduit (REMIC)) will be included in such corporation's adjusted current earnings for purposes of calculating such corporation's alternative minimum taxable income. A corporation's alternative minimum taxable income is the basis on which the alternative minimum tax and the environmental tax imposed by the Code are computed. Purchasers of Certificates are directed to the discussion entitled "TAX EXEMPTION" set forth in the Official Statement. UNDER EXISTING LAW and based upon the assumptions stated in the Official Statement prepared for use in connection with the sale of the Certificates, it is also our opinion as follows: (1) the difference between (a) the stated redemption price at maturity of each Certificate maturing in the years, 2006 through 2014, inclusive (the "Discount Certificates"), and (b) the initial offering price at which a substantial amount of such Discount Certificates of the same maturity were sold to the public, as described in the Official Statement, constitutes original issue discount with respect to each such Discount Certificate in the hands of an owner who purchased such Discount Certificate at the initial offering price in the initial public offering of the Certificates; and (2) such initial owner is entitled to exclude from gross income for federal income tax purposes with respect to such Discount Certificate that portion of the original issue discount deemed to be earned for federal income tax purposes during the period that such Discount Certificate continues to be owned by such owner. In the event of the redemption, sale or other taxable disposition of such Discount Certificate prior to its stated maturity, however, any amount realized by such owner in excess of the basis of such Discount Certificate in the hands of such owner (adjusted upward by the portion of the original issue discount deemed to be earned during the period for which such Discount Certificate was held by such initial owner) is includable in gross income for federal income tax purposes. PURCHASERS OF DISCOUNT CERTIFICATES in the initial public offering are directed to the discussion entitled "TAX TREATMENT OF ORIGINAL ISSUE DISCOUNT AND PREMIUM CERTIFICATES" set forth in the Official Statement for purposes of determining the portion of the original issue discount which is deemed to be earned for federal income tax purposes during the period such Certificates are held by an initial owner. The federal income tax consequences of the purchase, ownership and redemption, sale or other taxable disposition of Discount Certificates which are not purchased in the initial public offering at the initial offering price may be determined according to rules which differ from those described above and in the Official Statement. 3 T r EXCEPT AS DESCRIBED ABOVE, we express no opinion as to any federal, state or local tax consequences resulting from the ownership of, receipt or accrual of interest on, or the acquisition or disposition of, the Certificates. Prospective purchasers of the Certificates should be aware that the ownership of tax-exempt obligations, such as the Certificates, may result in collateral federal income tax consequences to, among others, financial institutions, property and casualty insurance companies, certain foreign corporations doing business in the United States, certain S corporations with Subchapter C earnings and profits, individual recipients of Social Security or Railroad Retirement benefits and taxpayers who are deemed to have incurred or continued indebtedness to purchase or carry tax-exempt obligations. Such prospective purchasers should consult their tax advisors as to the consequences of investing in the Certificates. V V V r 0218852.01 059522/1817 4 r Q�tN EY C, ;Q ,*' t: ��xTEXA`?'` Office of tije ZIttornep enerat *tate of Texas DAN MORALES ATTORNEY GENERAL May 22, 1995 THIS IS TO CERTIFY that the City of Pearland, Texas (the "Issuer'), has submitted to me City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995 (the "Certificates") in the aggregate principal amount of $5,000,000 for approval. The Certificates are dated May 1, 1995, numbered R-1 through R-18, and were authorized by Ordinance No. 689 of the Issuer passed on April 24, 1995 (the "Ordinance). I have examined the law and such certified proceedings and other papers as I deem necessary to render this opinion. As to questions of fact material to my opinion, I have relied upon representations of the Issuer contained in the certified proceedings and other certifications of public officials furnished to me without undertaking to verify the same by independent investigation. I express no opinion relating to the Official Statement or any other offering material relating to the Certificates. Based on my examination, I am of the opinion, as of the date hereof and under existing law, as follows (capitalized terms, except as herein defined, have the meanings given to them in the Ordinance): (1) The Certificates have been issued in accordance with law and are valid and binding obligations of the Issuer. (2) The Certificates are payable from the proceeds of an annual ad valorem tax levied, within the limit prescribed by law, upon all taxable property in the Issuer, and are further payable from and secured by a junior and subordinate lien on and pledge of the Net Revenues of the Issuer's waterworks and sanitary sewer system in an amount not to exceed $10,000. Therefore, the Certificates are approved. Attorney General of the State of Texas No. 29257 Book No.95-B SPC 512/463-2100 P.O. BOX 12548 AUSTIN, TEXAS 78711-2548 PRI T 1), . PFC}CI.FP PAPFR AN EOUAL EMPLOYMENT OPPORTUNITY EMPLOYER OFFICE OF COMPTROLLER OF THE STATE OF TEXAS I, John Sharp, 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 Pearland. Texas Combination Tax and Revenue Certificates of Obligation. Series 1995 numbered Fi-1/R-18, of the denomination of $ various, dated May 1 . 1995, as authorized by issuer, interest various percent, under and by authority of which said bonds/certificates were registered electronically in the office of the Comptroller, on the 22nd day of May. 1995, under Registration Number 57259. Given under my hand and seal of office, at Austin, Texas, the 22nd day of May. 1995. JOHN SHARP Comptroller of Public Accounts of the State of Texas r OFFICE OF COMPTROLLER OF THE STATE OF TEXAS I, Melissa Guzman, nBond Clerk X Assistant Bond Clerk in the office of the Comptroller of the State of Texas, do hereby certify that, acting under the direction and authority of the Comptroller on the 22nd day of May. 1995, I signed the name of the Comptroller to the certificate of registration endorsed upon the: City of Pearland. Texas Combination Tax and Revenue Certificates of Obligation. Series 1995, numbered Ji-1/R-1a, dated May 1. 1995, and that in signing the certificate of registration I used the following signature: G/IP) IN WITNESS WHEREOF I have executed this certificate this the 22nd day of May. 1995. /6-1, 177av14— I, John Sharp, Comptroller of Public Accounts of the State of Texas, certify that the person who has signed the above certificate was duly designated and appointed by me under authority vested in me by TEX. REV. CIV. STAT. ANN. art. 4362 (1969), with authority to sign my name to all certificates of registration, and/or cancellation of bonds required by law to be registered and/or cancelled by me, and was acting as such on the date first mentioned in this certificate, and that the bonds/certificates described in this certificate have been duly registered in the office of the Comptroller, under Registration Number 57259. GIVEN under my hand and seal of office at Austin, Texas, this the 22nd day of May. 1995. JOHN SHARP Comptroller of Public Accounts of the State of Texas r Capital Guaranty Insurance Company Steuart Tower•22nd Floor One Market San Francisco, CA 94105 rim (415)995-8000 14151 995-8008 Telecopier May 24, 1995 CAPITAL �NTY City of Pearland, Texas Re : LEGAL OPINION $5, 000, 000 '" City of Pearland, Texas (Brazoria and Harris Counties) Combination Tax and Revenue Certificates of Obligation, Series 1995 — Dated Date: May 1, 1995 (the "Obligations" ) Municipal Bond Guaranty Insurance Policy Number: 95-0142-14TX1-10 Ladies and Gentlemen: I am the Associate General Counsel of Capital Guaranty Insurance Company, a stock insurance company incorporated in the State of Maryland ( "Capital Guaranty") and, as such, am familiar with the corporate affairs of Capital Guaranty. In connection with the issuance by Capital Guaranty of a certain municipal bond guaranty insurance policy on the date hereof (the "Municipal Bond Guaranty Insurance Policy" ) insuring the payment of the principal of and interest on the above-captioned Obligations, I have examined such documents and reviewed such questions of law and procedures as I deemed necessary or appropriate for the purpose of this opinion and, on the basis of such knowledge, examination and review, you are advised that in my opinion: (1) Capital Guaranty has been duly incorporated and is validly existing and in good standing under the laws of the State of Maryland; and (2) the Municipal Bond Guaranty Insurance Policy was issued in the ordinary course of business and constitutes the legal, valid and binding obligation of Capital Guaranty enforceable — in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization, rehabilitation and other similar laws of general applicability relating to or affecting creditors ' and/or claimants ' rights against insurance companies and to general equity principles . r $5, 000 , 000 City of Pearland, Texas (Brazoria and Harris Counties) Combination Tax and Revenue Certificates of Obligation, Series 1995 May 24 , 1995 Page 2 P _ I am admitted to practice law in the State of Texas and do not hold myself out as expert in, generally familiar with, or qualified to express legal conclusions as to the laws of any other state, except for the matters expressly set forth in the foregoing opinion. This opinion is intended solely for your benefit and is not to be relied upon by any person other than you without my prior written PP consent . I specifically disclaim any express or implied obligation to update or continue the opinions or references contained hereinabove beyond the present date . Very truly yours, Robert J. David Vice President Associate General Counsel I I p p p I p p If p S5,000,000 CITY ON PBAP.LAND, TEXAS cONIBDIATION TAX AND REV1N7UB CffitT1PICATES OP OBLIQA'1'1UN. S1'tY .0 1995 May 24, 1995 I, the tuatiersigned, a duly authorized motive of Tarns Commerce Bank National Asiatiaa, Houma, Teams, bescby acknowledge receipt on behalf of the City of Pea,dand, Texas (the 'My') of the dirt purchase price for the City's Combination Tax and Revenue Certificates of Obligation, Series 1995, in the total account of S5,018,653.64, represeadag ties par amount of the Certifumtes of $5,000,000 plus aaarued ink of$18,653.64 al the date hereof. TEXAS C t ?BANK NATIONAL ASSOC EATION lean, Texas Narne Yp.„.c...(2, ICA C. GARCSA Title: CORPCVtATtRusT oFFren I, the undersigned, a duly authorized representative of Nationalaxw Capital Market!, Inc., hereby L ici ledge reoppt.from the City of(I) the Initial bands of its Combination Tax and Revenue Cc tiftCAtca of Obligidca, Series 1995, dated May 1, 1995, which have been deltvered to the undersigned in Now form on the date hereof and (ii)our encashed God Faith Check in the amount of$100,000. NATIONSBANC CAPITAL MARKETS, INC. J By C. Name; L . o n r ntle:' Assistant Vice President 0216t4.l.0t e54.124 0156 REGISTRAR'S RECEIPT THE STATE OF TEXAS § COUNTIES OF BRAZORIA AND HARRIS § CITY OF PEARLAND § The undersigned duly authorized representative of Texas Commerce Bank National Association, Houston, Texas, the paying agent/registrar for the $5,000,000 City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995, certifies that said certificates have been duly registered in accordance with the Ordinance dated April 24, 1995, and have been delivered to the purchaser of said Certificates. Executed and delivered this Zv9, , 1995. TEXAS COMMERCE BANK NATIONAL ASSOCIATION Houston, Texas By: Name: YOLANDA C. GARCIA Title: CORPORATE TRUST OFFICER 0216146.01 049521/1418 MAYOR, DAY, CALDWELL 8 KEETON, L.L.P. 700 LOUISIANA, SUITE 1900 HOUSTON,TEXAS 77002-2778 (713)225-7000 100 CONGRESS AVENUE TELECOPIER(713)225-7047 SUITE 1500 AUSTIN,TEXAS 78701-4042 (512)320-9200 May 24, 1995 TELECOPIER(512)320 9292 Capital Guaranty Insurance Company Steuart Tower, 22nd Floor One Market San Francisco, California 94015 Re: City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995; Municipal Bond Insurance Policy No. 95-0142-14TX1-10 Ladies and Gentlemen: This letter is provided to you pursuant to your offer to NationsBanc Capital Markets, Inc., dated April 25, 1995, to issue a Municipal Bond Guaranty Insurance Policy for the captioned certificates of obligation (the "Certificates"). We have delivered an opinion, dated as of the date hereof, in our capacity as Bond Counsel in connection with the issuance and sale of the Certificates regarding the validity of the Certificates and the exclusion of interest on the Certificates from gross income for federal income tax purposes. Please be advised that such opinion may be relied upon by Capital Guaranty Insurance Company as if such opinion were addressed to you. a/y / p(S1 ay- F r r 0223972.01 059522/1734 f F AItAARANiY r CAPITAL GUARANTY INSURANCE COMPANY MUNICIPAL BOND GUARANTY INSURANCE POLICY •- IN THE EVENT CAPITAL GUARANTY INSURANCE COMPANY IS UNABLE TO FULFILL ITS CONTRACTUAL OBLIGATION UNDER THIS POLICY OR CONTRACT OR APPLICATION OR CERTIFICATE OR EVIDENCE OF COVERAGE, THE POLICYHOLDER OR CERTIFICATEHOLDER IS NOT PROTECTED BY AN INSURANCE GUARANTY FUND OR OTHER SOLVENCY PROTECTION ARRANGEMENT. Policy No: 95-0142-14TX1-10 ri Capital Guaranty Insurance Company ("Capital Guaranty" ) in consideration of the payment of the premium and subject to the terms of this policy, hereby unconditionally and irrevocably guarantees to any owner, as hereinafter defined, of the following described Obligations, the full and complete payment required to be made by or on behalf of the Issuer to: Texas Commerce Bank National Association, Houston, Texas or its successor (the "Paying Agent" ) of an amount equal to (i) the principal of (either at the stated maturity or by any advancement of maturity pursuant to a mandatory sinking fund payment) and interest on, the Obligations (as that term is defined below) as such payments shall become due but shall not be so paid (except that in the event of any .• acceleration of the due date of such principal by reason of mandatory or optional redemption or acceleration resulting from default or otherwise, other than any advancement of maturity pursuant to a mandatory sinking fund payment, the payments guaranteed hereby shall be made in such amounts and at such times as such payments of principal would have been due had there not been any such acceleration) ; and (ii) the reimbursement of any r such payment which is subsequently recovered from any owner pursuant to a final judgment by a court of competent jurisdiction that such payment constitutes an avoidable preference to such owner within the meaning of any applicable bankruptcy law. The amounts referred to in clauses (i) and (ii) of the preceding sentence shall be referred to herein collectively as the "Insured Amounts . " "Obligation" shall mean: ISSUER: City of Pearland, Texas (Brazoria and Harris Counties) r ISSUE: $5, 000 , 000 Combination Tax and Revenue Certificates of Obligation, Series 1995 GUARANTIED MATURITIES : Serial Certificates maturing March 1, 1997, through March 1, 2014 rDATED DATE : May 1, 1995 r Upon receipt of telephonic or telegraphic notice, such notice subsequently confirmed in writing by registered or certified mail, or upon receipt of written notice by registered or certified mail, by the Claims Officer or its designee from the Paying Agent or any owner of an Obligation the payment of an Insured Amount for which is then due, that such required payment has not been made, Capital Guaranty on the due date of such payment or within one business day after receipt of notice of such nonpayment, whichever is later, will make a deposit of funds, in an account with its Disbursing Agent or its successor, sufficient for the payment of any such Insured Amounts which are then due . Upon presentment and surrender of such Obligations or presentment of such other proof of ownership of the Obligations, together with any appropriate instruments of assignment to evidence the assignment of the Insured Amounts due on the Obligations as are paid by Capital Guaranty and appropriate instruments to effect the appointment of Capital Guaranty as agent for such owners of the Obligations in any legal proceeding relating to payment of Insured Amounts on the „ Obligations, such instruments being in a form satisfactory to Capital Guaranty, Capital Guaranty shall cause its Disbursing Agent to disburse to such owners or the Paying Agent payment of the Insured Amounts due on such Obligations, less any amount held by the Paying Agent for the payment of such Insured Amounts and legally available therefor. This policy does not insure against loss of any prepayment premium which may at any time be payable with respect to any Obligation. As used herein, the term "owner" shall mean the registered owner of any Obligation as indicated in the books maintained by the Paying Agent, the Issuer, or any designee of the Issuer for such purpose . The term owner shall not include the Issuer or any party whose agreement with the Issuer constitutes the underlying r. security for the Obligations. As used herein, the term "Disbursing Agent" means a bank or trust .• company selected by Capital Guaranty or a successor Disbursing Agent, designated to receive and remit funds on behalf of Capital Guaranty. This policy is non-cancellable for any reason. The premium on this policy is not refundable for any reason including the payment prior to maturity of the Obligations . r Any service of process on Capital Guaranty may be made to the Secretary, Capital Guaranty Insurance Company, One Market, Steuart Tower, 22nd Floor, San Francisco, California 94105-1413 and such service of process shall be valid and binding. vio a In Witness Whereof, Capital Guaranty has caused this policy to be executed by its Senior Vice President and Assistant Secretary as of the 24th day of May, 1995 . CAPITAL U TY INSURANCE COMPANY /, By: Barry Levine Title : Vice President Pla B o �Q„ .�t.,r .' 9-� Y Robert J. David Title : Assistant Secretary Effective Date : May 24 , 1995 Resident Agent Countersignature Agency: C.A. Schutze Agency Stephen P. Schutze Address : 1101 South Congress Austin, Texas 78764 Y 1 a Date : May 16 , 1995 a a a TX9-BS 3 r FROM r lal MO. •y t I lvestors Service i 99 Church Street New York,NY 10007 rMay 23, 1995 r Capital Guar my Insurance Company Steua t Towe , 22nd Floor One M rket P aza San F aneisoo, CA 94105-1413 Dear .07c : Moody s investors Service has assigned the rating of Jiaa (CGIC Insured - Policy No_ 95-0142-14TX1-10) to the 55, 00 , Goo ;ity of pearland, Texas, (Brazoria and Harris Count. en) , dombination Tax and Revenue Certificates of Oblig: tion, Series 1995, dated May 1, 1996, which sold on April 24 , 1495 . The rating is based upon an insurance polio. provided by Capital Guaranty Insurance Company. Shout- you have any questions regarding the above, please do n• hesitate to contact the assigned analyst, Margaret Kess:. -r at (212) 553-7884 . Sincerely yours, kohm-~7.6---- ' Daniel N. Heimowitz Executive Vice President Director Public Finance Department DH:gm Standard & Poor's Ratings Group, A Division of McGraw-Hill, Inc_ Bond Insurance Administration 25 Broadway New York, New York 10004-1084 Telephone 212/208-1740 FAX Z1Z/208-8262 May 15. 1995 Ms. Nancy J. McGee Senior Vice President Capital Guaranty Insurance Company Steuart Tower - 22nd Floor One Market Plaza San Francisco, California 94105-1413 Re: SS,000,000 Pearland, .9ratarj. and Harris Counties, Combination Tax and Revenue Certificates of Obligation, Series 1995, dated: May 1, 1995, Serial Certificates due: March I, 1997-2014, (POLICY #95-0142-14TXI-10) Dear Ms. McGee: This is to advise you that we have changed the rating to 'AAA' from 'A' on the subject bonds. The rating change reflects our assessment of the likelihood of repayment of principal and interest based on the bond insurance policy your company is providing. When using this Standard & Poor's rating, include S&P's definition of the rating together with a statement that this may be changed, suspended or withdrawn as a result of changes in, or unavailability of, information. This rating is not a "market rating because it is not a recommendation to buy, hold or sell die obligations. If you have any questions, please contact us. Very truly yours, v aw r:� r • 11� Capital Guaranty Insurance Company,a Maryland corporation,has issued its Municipal Bond Guaranty Insurance Policy Number 95-0142-I4TX1-10 �• •/ (the"Insurance Policy")securing the payment of Insured Amounts of this Obligation,as such terms are defined in said Insurance Policy. ��� r� �� Reference is made to the Insurance Policy for the complete provisions thereof.All payments required to be made under the Insurance Policy shall be ,,` ' \ it made in accordance with provisions thereof. �� �• UNITED STATES OF AMERICA . _ �'i nb• ' • ••• • ••• STATE OF TEXAS • ••• •:•• ••• A GI>;T$R D •'• 'J •' ��_,:,I__ '• •• •::• • •'i CITY OF PEARLAND, TEXAS ••' • ' �o► •aRs •.-: •; ,� COMBINATION TAX AND REVENUE ('::.:::: CERTIFICATE OF OBLIGATION ;- t "` • ••• • SERIES 1995 • • •..• : . ,•• -_- :• 111lTERUST••RA•TE: : : : ISSUE DATE: MATURITY DATE: •:•• ••• • •CI�S1R: : : : A • ••• •• •. ••• •. , May 1, 1995 ti >qi iY r r s "K (\ THE CITY OF PEARLAND,TEXAS,a municipal corporation of and to pay interest thereon at the rate shown above,calculated on a earlier redemption shall be paid upon presentation and surrender of '' • the State of Texas(the"City"),for value received,herebypromises to basis of a 360-day year composed of twelve 30-day months,from the this Certificate at the principal corporate trust office of the Paying , g j- z '/ a to the Registered OAK t d abo red as later ,Issue ifi e I t t/Reg —' '`' on the maturity date spy �� �(or �t t e as\payti� � t �� st o� ��. d fa� FER� \��,`��ER TO THE FURTHER herein provided), upon pr • �: d su th cat\ tere this ' s 13�ab ch \an) eac \ SION \\IS CE CA ET FORTH ON THE at the principal corporal st a of s, o e ank slater 1 there until t . �arli R RSE IC OVI S SHALL HAVE THE National Association, \ 4r he • ed �f t by V t b n � 'OR\ ORTH AT THIS PLACE. :- e� ',tiCity corporate �����h' , ,,,; ,� Agent/Registrar"),the principa amount ide ito above(or so muc first c ass, postage prepaid, by the aying Agen egistrar tote IN WITNESS WHEREOF,the has caused its seal � �' paidpaiduponRegisteredto be impressed or placed in facsimile hereon and this Certificate to ��,})t.`,S':> ,thereof as shall not have been or deemed to have been Owner of record as of the close of business on the fifteenth t „ prior redemption)payable in any coin or currency of the United States day of the calendar month immediately preceding the applicable be signed by the Mayor Pro Tern, countersigned by the Interim City ;',":.s `�-,��' or printed facsimile of America which on the date of payment of such principal is legal interest payment date,as shown on the registration books kept by the Secretary by their manual, lithographed tender for the payment of debts due to the United States of America, Paying Agent/Registrar. Any accrued interest payable at maturity or signatures. :,e`-'7 . AUTHENTICATION CERTIFICATE It1111IIIIbp, ,r This Certificate is one of the Certificates described in and delivered pursuant to the within-mentioned ss%ui epR I ,",, CITY OF PEARLAND,TEXAS off;< Ordinance;and,except for the Certificates initially delivered,this Certificate has been issued in exchange for or `‘� N.• •••HO �.,, \tea K /✓.. replacement of a Certificate,Certificates,or a portion of a Certificate or Certificates of an issue which originally = p.:'• ••• •" J. �Z was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public a�,: ' \\\ _ 1'' Accounts of the State of Texas. a L: •��•••••.,4 r 1�1i�3• a 1. D Z. COUNTERSIGNED: i /\ ,itof ��' Date of Authentication: F.V'• ��` .' CIO'� " �.y TEXAS COMMERCE BANK NATIONAL ASSOCIATION, \ as Paying Agent/Registrar •: �o� . 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Vf' ��l ll dill ill Ih\�. ,.,� 1 ,�h7N l o� �'�i � �I I pp II 11 11 I I��� _.:� I '.v� 11 � � � d.Yl. I �� d.. % /���,//�(I/i�.11111 g1t0, M„� ../',( I V ✓/I M p�1�' ✓/I '�/•r 'I� � '��' �lry��l1 ./ri �"', ,yN=��i� • ���� .) H,``• �' �\ r n,d I I 16;A I N e,h e•, (�.: t.. ,,at Q 6 1) ,nh•;Q ges'� I ,,lit.el/.nJ, 11 r 1 , CA G 9 b "wi\0.�1N.g1,✓ `S• 9, + r Ae :�o•�.e.o•. � ✓:,-' ..r,..l,.,l, 1Jii,,It 11,p.,l ;. % �:'' ;a� °�..r✓//lln.. , t.tl 'X,,.uit�li",. dd H ,�6 � ,. !, $ u f., ,.�ry+��, rr., l{{yy/1.1n11 1 ,,�vcYr��� I ll„.I 1, 1A;10 L,d i. ll ll.,.p�AµpC Ih. '?�(i ���.b� .,. 1 � I�. .•,s.�.... �}{{@@',q.•.�:;f��� x,,���I" �� „ ��, ...�'.. ,.N. o .. �. Yi a�...• � ` �' , J,.;jllt7b .1I�N�, ,�•v1 h d .,.,.a hY" ri.;•.,i,'l,o, ll ,.,� _ i .d1�6�7A 'N15,...�• , .,�II§fh ,� ri„� �. . �1. , f , (7tb t ,,,,. ,,'M :•I y�v,•,•', b.'V�Hlr (.,..• d�t��'fle.i..,..,...nl,. tSl�vKfflfli. l�vl�rl�. a� �ebs..,....,l4\.....�;r... �, t:...., n^a•,..,.,.alul�ltil:.,. ..... ��aA���fGs:•..,., _ . ... a 1 IIr.KN BANK Nol r..,,ii'AN\ THIS CERTIFICATE IS ONE OF A DULY AUTHORIZED SERIES OF CERTIFICATES (the regarded as being outstanding except for the purpose of being paid with the funds so provided for such "Certificates")in the aggregate principal amount of$5,000,000 issued pursuant to an ordinance adopted by the payment. City Council of the City on April 24,199$(the"Ordinance")for the purpose of providing all or part of the THIS CERTIFICATE IS TRANSFERABLE only upon presentation and surrender at the principal funds to pay contractual obligations to be incurred for(i)certain street projects located in the City including corporate trust office of the Paying Agent/Registrar,accompanied by an assignment duly executed by the but not limited to:the acquisition of right of way and construction of a street(including drainage)from John Registered Owner or its authorized representative,.subject to the terms and conditions of the Ordinance. Liter Road to Main Street(SH 35);acquisition of right of way and construction of a street(including drainage THIS CERTIFICATE IS EXCHANGEABLE at the principal corporate trust office of the Paying and bridge work)from Broadway(FM 518)to John Liter Road;renovations and improvements to Shadybend Agent/Registrar for a Certificate or Certificates of the same maturity and interest rate and in the principal Drive(including drainage) from Liberty Drive to Misty Street; renovations and improvements to the amount of$5.(8)0 or any integral multiple thereof,subject to the terms and conditions of the Ordinance. intersection of Walnut Drive and McLean Road;renovations and improvements to the intersection of old and THE PAYING AGENT/REGISTRAR is not required to accept for transfer or exchange any Certificate new North Hatfield Roads;and renovations and improvements of the intersections of West Broadway and called for redemption,in whole or in part,during the forty-five(45)day period immediately prior to the date Harkey Road and West Broadway and O'Day Road,(ii)renovations,improvements,materials,supplies, fixed for redemption;provided,however,that such limitation shall not apply to the transfer or exchange by the equipment and machinery for certain City buildings and facilities including but not limited to the City's public Registered Owner of an unredeemed portion of a Certificate called for redemption in part. library located ay 352 Liberty Drive, Pearland, Texas 77581, and (iii) the acquisition, construction, THE CITY OR PAYING AGENT/REGISTRAR may require the Registered Owner of any Certificate to improvement,r 3i m rials,supplies,egrap•ye %id machinery for certain drainage facilities located in the r• pay a sum sufficient to cover any tax or.other governmental or hargl chargefthat may be imposed inconnectionratransfer nsfe the City including set nos bruited to:flood control improvements south of the South Corrigan subdivision;the transfer or exchange of a Certificate.Any fee or charge of the Paying Agent/Registrar for a transfer or Hickory Regional Detention located south of gibe Twin Creek Woods subdivision;and formulation of a exchange shall be paid by the City. City-wide storryhtrlriloinage plan.Proceeds of Sle Certificates also will be used to pay costs of issuance of THE REGISTERED OWNER of this Certificate by acceptance hereof,acknowledges and agrees to be the Certificates•nd rather professional serviclale• i hereto. bond by all the terms and conditions of the Ordinance. THIS CERTIFICATE shall not be valid or obligatory for any purpose or be entitled to any benefit under IT IS HEREBY DECLARED AND REPRESENTED that this Certificate has been duly and validly the Ordinance sent ssr Certificate either( r red by the Comptroller of Public Accounts of the State issued and delivered;that all acts,conditions and things required or proper to be performed,exist and to be of Texas by du c� of the registratto c e endorsed hereon or Ili)is authenticated by the Paying done precedent to or in the issuance and delivery of this Certificate have been performed,exist and have been AgenVRegistra y a ecution of the autMenugplio•certificae endorsed hereon. done in accordance with law;that the Certificates do not exceed any constitutional or statutory limitation;and THE CIT RESESE VES THE RIGHT,rat i•option,to redeem,prior to their maturity,Certificates that annual ad valorem taxes sufficient to provide for the payment of the interest on and principal of this maturing on and s arch I,21106,in whole or in part,on March I,2005,or any date thereafter,at par plus Certificate,as such interest comes due and suchprincipal matures,have been levied and ordered to be levied. accrued interests°the fixed for redemption. CERTIFIgkTES I4AY BE REDEEMSDAR PART only in integral multiples of$5,000.If a Certificate within the limits prescribed by law,against all taxable property in the City and have been irrevocably pledged subject to redemption is in a denomination largh than$5,000,a portion of such Certificate may be redeemed, for such payment. but only in int*.fiAttjtles of$5,000.In scree portions of Certificates for redemption,each Certificate IT IS FURTHER DECLARED AND REPRESENTED that the revenues to be derived from the City's shall be treated as representing that numbev%f •ficates of$5,000 denomination which is obtained by waterworks and sanitary sewer system,after the payment of all operation and maintenance expenses thereof dividing the prir�iaaT arr�unt of such Certificate ,(100.Upon surrender of any Certificate for redemption iji (the"Net Revenues'),in an amount not to exceed$10,000,are pledged to the payment of the principal of and in part,the Paying/5ent/Registrar,in accordance with the provisions of the Ordinance.shall authenticate and interest on the Certificates to the extent that ad valorem taxes may ever be insufficient or unavailable for such deliver in exchange therefor a Certificate or Certificates of like maturity and interest rate in an aggregate purpose,provided that the pledge of Net Revenues is and shall be junior and subordinate in all respects to the principal amoungesualsoahe unredeemed portion of the Certificate so surrendered. pledge of Net Revenues to the payment of any obligation of the City,whether authorized heretofore or NOTICE OF ANY SUCH REDEMFTICONAI identifying the Certificates or portions thereof to be hereafter,which the City designates as having a pledge senior to the pledge of the Net Revenues to the redeemed,shall be••rab,United Stales mai►first cl&s,postage prepaid,to the Registered Owners thereof at payment of the Certificates.The City also reserves the right to issue,for any lawful purpose at any time,in one their addresses At sh•wne,n the books of re trationlept by the Paying Agent/Registrar,not less than thirty or more installments,bonds,certificates of obligation and other obligations of any kind,secured in whole or in (30)days heforelhe datetxed for such redo ption. y the date fixed for redemption,due provision shall be part by a pledge of Net Revenues,that may be prior and superior in right to,on a parity with,or junior and made with the Paying Agent/Registrar for the paervent of the redemption price of the Certificates called for subordinate to the pledge of Net Revenues securing the Certificates. redemption.If Ofc 1 o u e of redemption is mien,yid if due provision for such payment is made,all as REFERENCE IS HEREBY MADE TO THE ORDINANCE,a copy of which is filed with the Paying provided above,the cfrtificaes which are to bu►so redeemed thereby automatically shall be redeemed prior to Agent/Registrar,for the full provisions thereof,to all of which the Registered Owners of the Certificates assent their scheduled raaar•iapsthey shall not bear inteca after the date fixed for redemption,and they shall not be by acceptance of the Certificates. MAYOR,DAY,CALDWELL&KEETON,L.L.P. tax purposes.The City has covenanted in the Ordinance to comply with each such requirement.Failure to 700 Louisiana,Suite 1900 comply with certain of such requirements may cause the inclusion of interest on the Certificates in gross Houston,Texas 77002 income for federal income tax purposes to be retroactive to the date of issuance of the Certificates.The Code WE HAVE ACTED as Bond Counsel for the City of Pearland,Texas(The"City")in connection with an and the existing regulations,rulings and court decisions thereunder,upon which the foregoing opinions of issue of certificates of obligation(the"Certificates")described as follows: Bond Counsel are based,are subject m change,which could prospectively or of for federal result in the inclusion of the interest on the Certificates in gross income of the owners thereof for federal income tax CITY OF PEARLAND,TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF puToses. OBLIGATION, SERIES 1995, dated May I, 1995, in the aggregate principal amount of INTEREST ON all tax-exempt obligations,including the Certificates,owned by a corporation(other than $5,000,000,maturing on March I in each year from 1997 through and including 2014.The an S corporation,a regulated investment company,a real estate investment trust(REIT)or a real estate Certificates are issuable in fully registered form only,in denominations of$5,000 or integral mortgage investment conduit(REMIC))will be included in such corporation's adjusted current earnings for multiples thereof,bear interest,are subject to redemption prior to maturity and may be transferred purposes of calculating such corporation's alternative minimum taxable income.A corporation's alternative and exchanged as set out in the Certificates and in the ordinance(the"Ordinance")adopted by the minimum taxable income is the basis on which the altemative minimum tax and the environmental tax City Council of the City authorizing their issuance, imposed by the Cede are computed.Purchasers of Certificates are directed to the discussion entitled"TAX WE HAVE ACTED as Bond Counsel for the sole purpose of rendering an opinion with respect to the EXEMPTION"set forth in the Official Statement. legality and validity of the Certificates under the Constitution and laws of the State of Texas and with respect UNDER EXISTING LAW and based upon the assumptions stated in the Official Statement prepared for to the exclusion of interest on the Certificates from gross income under federal income tax law.In such use in connection with the sale of the Certificates,it is also our opinion as follows:(I)the difference between capacity we have examined the Constitution and laws of the State of Texas;federal income tax law;and a (a)the staled redemption price at maturity of each Certificate maturing in the years, through transcript of certain certified proceedings pertaining to the issuance of the Certificates,as described in the inclusive(the"Discount Certificates'),and(b)the initial offering price at which a substantial amount of such Ordinance.The transcript contains certified copies of certain proceedings of the City;certain certifications and Discount Certificates of the same maturity were sold to the public,as described in the Official Statement, representations and other material facts within the knowledge and control of the City,upon which we rely;and constitutes original issue discount with respect to each such Discount Certificate in the hands of an owner who certain other customary documents and instruments authorizing and relating to the issuance of the Certificates, purchased such Discount Certificate at the initial offering price in the initial public offering of the Certificates; We have also examined executed Certificate No.R-I of this issue. and(2)such initial owner is entitled to exclude from gross income for federal income tax purposes with WE HAVE NOT BEEN REQUESTED to examine,and have not investigated or verified,any original respect to such Discount Certificate that portion of the original issue discount deemed to be eased for federal proceedings,records,data or other material.but have relied upon the transcript of certified proceedings.We income tax purposes during the period that such Discount Certificate continues to ae owned by such owner.In have not assumed any responsibility with respect to the financial condition or capabilities of the City or the the event of the redemption,sale or other taxable disposition of such Discount Certificate prior to its stated disclosure thereof in connection with the sale of the Certificates.Our role in connection with the City's maturity,however,any amount realized by such owner in excess of the basis of such Discount Certificate in Official Statement prepared for use in connection with the sale of the Certificates has been limited as described the hands of such owner(adjusted upward by the portion of the original issue discount deemed to be earned therein. during the period for which such Discount Certificate was held by such initial owner)is includable in gross income for federal income tax purposes. BASED ON SUCH EXAMINATION,it is our opinion as follows: PURCHASERS OF DISCOUNT CERTIFICATES in the initial public offering are directed to the (1)The transcript of certified proceedings evidences complete legal authority for the issuance of the discussion entitled 'TAX TREATMENT OF ORIGINAL ISSUE DISCOUNT AND PREMIUM Certificates in full compliance with the Constitution and laws of the State of Texas presently in effect;the CERTIFICATES"set forth in the Official Statement for purposes of determining the portion of the original Certificates constitute valid and legally binding obligations of the City enforceable in accordance with issue discount which is deemed to be earned for federal income tax purposes during the period such the terms and conditions thereof,except to the extent that the rights and remedies of the owners of the Certificates are held by an initial owner.The federal income tax consequences of the purchase,ownership and Certificates may be limited by laws heretofore or hereafter enacted relating to bankruptcy,insolvency, redemption,sale or other taxable disposition of Discount Certificates which are not purchased in the initial reorganization,moratorium or other similar laws affecting the rights of creditors of political subdivisions public offering at the initial offering price may be determined according to rules which differ from those and the exercise of judicial discretion in appropriate cases;and the Certificates have been authorized and described above and in the Official Statement. delivered in accordance with law;and EXCEPT AS DESCRIBED ABOVE,we express no opinion as to any federal,state or local tax (2)The Certificates are payable,both as to principal and interest,from the receipts of an annual ad consequences resulting from the ownership of,receipt or accrual of interest on,or the acquisition or disposition valorem tax levied,within the limits prescribed by law,upon taxable property located within the City, of. the Certificates. Prospective purchasers of the Certificates should be aware that the ownership of which taxes have been pledged irrevocably to pay the principal of and interest on the Certificates;and lax-exempt obligations,such as the Certificates,may result in collateral federal income tax consequences to, (3)The revenues to be derived from the operation the City's and sanitary sewer among others,financial institutions,property and casualty insurance companies,certain foreign corporations system after thepayment of all operation dfrand a operation of uses City's waterworks(the"Net Revenues' doing business in the United States,certain S corporations with Subchapter C earnings and profits,individual y expenses ),in an recipients of Social Security or Railroad Retirement benefits and taxpayers who are deemed to have incurred amount not to exceed$10,000,are pledged to the payment of the principal of and interest on the or continued indebtedness to purchase or carry tax-exempt obligations.Such prospective purchasers should Certificates,to the extent that ad valorem taxes may ever be insufficient or unavailable for said purpose; consult their tax advisors as to the consequences of investing in the Certificates. provided,however,that such pledge is junior and subordinate in all respects to the pledge of Net Revenues to the payment of any obligation of the City,whether authorized heretofore or hereafter,which MAYOR,DAY,CALDWELL&KEETON,L.L.P. the City designates as having a pledge senior to the pledge of Net Revenues to the payment of the Certificates. I HEREBY CERTIFY that the above and foregoing is a true and correct copy of the legal opinion upon The City has reserved the right to issue,for any lawful purpose at any time,in one or more the Certificates of Obligation there described which was manually signed by Mayor,Day,Caldwell&Keeton, installments,bonds,certificates of obligation and other obligations of any kind secured by a pledge of the L.L.P.,Houston,Texas,and was dated as of the date of delivery of and payment for said Certificates of Net Revenues that may be prior and superior in right to,on a parity with,or junior and subordinate to the Obligation and that a signed original copy of such opinion is on file in the office of the City of Pearland, pledge of Net Revenues securing the Certificates. Texas. ALSO BASED ON OUR EXAMINATION AS DESCRIBED ABOVE,it is our further opinion that, subject to the reuriclions hereinafter described,interest on the Certificates is excludable from gross income of the owners thereof for federal income tax purposes under existing law and is not subject to the alternative � minimum tax on individuals or,except as hereinafter described,corporations.The opinion en forth in the first �`57�., M�z p j-'n I' /f sentence of this paragraph is subject to the condition that the City comply with all requirements of the Internal "117/('6e )(/J`,C_W/V C(.. Revenue Code of 1986,as amended(the"Code'),that must be satisfied subsequent to the issuance of the Certificates in order that interest thereon be,or continue to be.excluded from gross income for federal income Interim City Secretary ••• • ASSIGNMENT For value received,the undersign&(hereby sells,assigns and transfers unto • • • • •(toE#!E INSERT SOCI Sf i OR TAXPP EI�fDFZITIFICAT ON NUM EIl,OF RANSFEREE) • • ••• • ••••4 • ••••III ••rat• (Please print or type name,address,and zip code of Transferee) • • • •the within ceyti .tp and all rights thereunder,and hereby irrevocably constitutes and appoints • • • • • • • • • attorney •• to transfer sunee?tillcate on the boos ke=t for registration thereof,with full power of substitution in the premises. • • DATED: •• Signature Guaranteed: NOTICE:Signature must be guaranteed by a member firm of the New York Registered Owner Stock Exchange or a commercial hank nr mist cmmnanv sanmrr n.m._ _._-.__.._.__—____�__ ____ _ .... , AFFIDAVIT OF PUBLICATION REPORTER NEWS P.O. Box 954 Friendswod, Texas 77546 State of Texas County of Galveston improvements tg TICE OF INTENTION ISSUE CERTIFICATES ' Shadybend Drive (including ' drainage)from Liberty Drive I, Linda Knight, to Misty Street; renovations:nded was published in Galveston County in NOTICE IS HEREBY GIVEN and improvements to the the RE ORTER t that the City COuncil of th in Galveston County and Brazoria County, for intersection of Walnut Drive ISSUE City of Pearland,Texas(th ; and McLean Road; renova- "City")will meet at its reg tions and improvements to lar meeting place at Cit the intersection of old and Hall,Pearland,Texas at 7:3 new North Hatfield Roads; p.m. on the 24th day o l' and renovations and APril, 1995, which is the improvements of the inter- 19 S No. / time and place tentatively- sections of West Broadway set for the passage of an and Harkey Road and West 19 No. ordinance and such other_ Broadway and O'Day Road, action as may be deemed (2) for renovations, No. necessary to authorize the improvements, materials, 19 issuance of the City's cer- supplies, equipment and tificates of obligation, machinery for certain City 19 No. payable from ad valorem- buildings and facilities taxation and a subordinate No. pledge of certain revenues includingheCity's butnot limited to 1 g of the City's water and the public library located at 3523 Liberty sewer system, in the maxi- Drive, Pearland, Texas mum aggregate principal 77581, (3) for the acquisi- amount of $5,500,000, bear- tion,construction, improve- ing interest at any rate or ment,repair,materials,sup- rates, not to exceed the plies, equipment and maximum interest rate now machinery for certain or hereafter authorized by drainage facilities located in law, as shall be determined the City including but not �� within the discretion of the limited to: flood control Classified Director City Council at the time of improvements south of the issuance and maturing over South Corrigan subdivision; a period of years not to the Hickory Regional exceed forty(40)years from Detention located south of the date thereof,for the pur• the Twin Creek Woods sub- i�� / pose of evidencing the division; and formulation of dayofc�1/'1 SubscribE indebtedness of the City tc a City-wide storm water be incurred (1) for certain drainage plan, and (4) for 19 !� street projects located in the City including but not professional services. - - - _ _ limited to:the acquisition of A. y� I wU4 ° $ f right of way and construc-I Public Notice j .4.� :-=F1�T;,R;r ;TA'Tans tion of a street (including _��44.1, i ;:�•!2t1 'RES drainage) from John Lizer �`' !^ c- !-Xas 9 ) WITNESS MY HAND AND �' � . �t �'y � � e Road to Main Street(SH 35); THE OFFICIAL SEAL OF- acquisition -�• -- acquisition of right of way THE CITY, this 13th day of _ and construction of a street March,1995. aura Ann Emmons (including drainage and bridge work) from Tommie Jean Vial Broadway(FM 518)to John City Secretary(Interim) Lizer Road;renovations and City of Pearland,Texas AFFIDAVIT OF PUBLICATION REPORTER NEWS P.O. Box 954 Friendswod, Texas 77546 • State of Texas County of Galveston NOTICIA DE INTENCION l E EMITIR CERTIFICADOS Broadway(FM 518) hasta la hereby appended was published in Galveston County in calle John Lizer Road; las TOME NOTICIA que el renovaciones y mejo- tl circulation in Galveston County and Brazoria County, for Consejo Municipal de la 'ramientos de la intersec- •Ciudad de Pearland, Texas cion de la calle North ('la Ciudad") se juntara en Hatfield vieja y la calle el sitio regular de juntas, el North Hatfield nueva; y ren- ayuntamiento de Pearland, !ovaciones y mejoramientos Texas a las 7:30 p.m.el dia j de las intersecciones de la C,/ 24 de abril de 1995, e tiem- calle West Broadway, la 1 9 po y lugar tentativamente [calla Harkey Road y la calle programado para el pasaje I O'Day Road, (2) para reno- 19 de una ordenanza y tal otra vaciones, mejoramientos, accion que consideren materiales, surtidos,equipo 19 necesario para autorizar la Y maquinarias para clefts emision de certificados de edificios y facilidades de la obligacion de la Ciudad, Ciudad incluyendo pero no 19 siendo repartido de solamente la biblioteca pub- impuestos segun valor y lica de la Ciudad localizado 1 9 una prenda de ciertas a 3523 Liberty Drive, rentas publicas del sistema !Pearland, Texas 77581, (3) de agua y cloaca de la la adquisicion, construc- Ciudad en una cantidad cion, mejoramiento, repara- principal maximo agregado don, materiales, surtidos, de $5,500,000, devengando equipo y maquinaria para interes a cualquier valor o ciertas facilidades drenaje valores fijos, que no exce localizados en la Ciudad, den el valor de interes maxi- incluyendo, pero no sola mo ahora o despues de ser mente; mejoramientos de autorizado pot ley, como controlar la inundation Classified Dire tor sea determinado dentro la localizado el sur de la sub discreccion del Consejo division de South Corrigan; Municipal al tiempo de emi- la Hickory Regional sion y maduracion sobre un Detention localizado el sur perfodo de anos que no de la subdivision de Twin excede cuarenta (40) anos Creek Woods; y la formula- :his Z.? day of Mat'id, de esa fecha, con fin a evi- cion de un plan de drenaje denciar a deuda que haya de agua de una torments incurido la Ciudad, (1) para para la Ciudad enters, y (4) _ _ _ . algunos proyectos de la para servicios profesion ales. , 'F`'y ��5' itAMONS t calle localizadas en la Y. Ciudad,incluyendo,pero no — ,• .`nr ' �FSar� TESTIGUE MI MANO Y LA .,:e ��' solamente,los siguientes: / la adquisicion de derecho SELLA DE LA CIUDAD,este tita ! ublic cStattotf Tex--s de paso y la construccion 13 dia de Margo,1995. __ ---—--- de una calle (incluyendo el • drenaje)desde la calle John Tommie Jean Vial Laura Ann Emmons Lizer Road hasta la calle Secretaria de la Ciudad Main Street (SH 35); la (Interina) adquisicion de derecho de Ciudad de Pearland,Texas ' paso y la construccion de una calle (incluyendo el drenaje y trabajo en un puente) desde la calle e? Cuj of p@affiland Pv *A\EX 3519 liberty Drive • Pearland, Texas 77581-5416 P`� (713) 485-2411 • fax (713) 485-8764 March 20, 1995 VIA FAX TRANSMISSION The Reporter Newspaper Pearland, Texas Re: Notice of Intention to Issue Certificates Gentlemen: Please published the attached legal notice in both English and Spanish on the following dates: March 22, 1995 March 29, 1995 Thank you very much. Sincerely, nete ommie Jean Vial Interim City Secretary TJV/s Attachment Printed on Recycled Paper NOTICE OF INTENTION TO ISSUE CERTIFICATES NOTICE IS HEREBY GIVEN that the City Council of the City of Pearland, Texas (the "City") will meet at its regular meeting place at City Hall, Pearland, Texas at 7:30 p.m. on the 24th day of April, 1995, which is the time and place tentatively set for the passage of an ordinance and such other action as may be deemed necessary to authorize the issuance of the City's certificates of obligation, payable from ad valorem taxation and a subordinate pledge of certain revenues of the City's water and sewer system, in the maximum aggregate principal amount of$5,500,000, bearing interest at any rate or rates, not to exceed the maximum interest rate now or hereafter authorized by law, as shall be determined within the discretion of the City Council at the time of issuance and maturing over a period of years not to exceed forty (40) years from the date thereof, for the purpose of evidencing the indebtedness of the City to be incurred (1) for certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Lizer Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Lizer Road; renovations and improvements to Shadybend Drive (including drainage) from Liberty Drive to Misty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West Broadway and O'Day Road, (2) for renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's public library located at 3523 Liberty Drive, Pearland, Texas 77581, (3) for the acquisition, construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City-wide storm water drainage plan, and (4) for professional services. WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this 13th day of March, 1995. City Secretary (Interim) City of Pearland, Texas (SEAL) NOTICIA DE INTENCION DE EMITIR CERTIFICADOS TOME NOTICIA que el Consejo Municipal de la Ciudad de Pearland, Texas ("la Ciudad") se juntara en el sitio regular de juntas, el ayuntamiento de Pearland, Texas a las 7:30 p.m. el dia 24 de abril de 1995, el tiempo y lugar tentativamente programado para el pasaje de una ordenanza y tal otra acci6n que consider6n necesario para autorizar la emisi6n de certificados de obligaci6n de la Ciudad, siendo repartido de impuestos segun valor y una prenda de ciertas rentas publicas del sistema de agua y cloaca de la Ciudad en una cantidad principal maximo agregado de $5,500,000, devengando inter6s a cualquier valor o valores fijos, que no exceden el valor de inter6s maximo ahora o despues de ser autorizado por ley, como sea determinado dentro la discreccion del Consejo Municipal al tiempo de emisi6n y maduracion sobre un periodo de aiios que no excede cuarenta (40) anos de esa fecha, con fin a evidenciar la deuda que haya incurido la Ciudad, (1) para algunos proyectos de la calle localizadas en la Ciudad, incluyendo, pero no solamente, los siguientes: la adquisici6n de derecho de paso y la construccion de una calle (incluyendo el drenaje) desde la calle John Lizer Road hasta la calle Main Street (SH 35); la adquisici6n de derecho de paso y la construccion de una calle (incluyendo el drenaje y trabajo en un puente) desde la calle Broadway (FM 518) hasta la calle John Lizer Road; las renovaciones y mejoramientos de la interseccion de la calle North Hatfield vieja y la calle North Hatfield nueva; y renovaciones y mejoramientos de las intersecciones de la calle West Broadway, la calle Harkey Road y la calle O'Day Road, (2) para renovaciones, mejoramientos, materiales, surtidos, equipo y maquinarias pars ciertos edificios y facilidades de la Ciudad incluyendo pero no solamente la biblioteca pliblica de la Ciudad localizado a 3523 Liberty Drive Pearland, Texas 77581, (3) la adquisici6n, construccion, mejoramiento, reparacion, materiales, surtidos, equipo y maquinaria para ciertas facilidades drenaje localizados en la Ciudad, incluyendo, pero no solamente: mejoramientos de controlar la inundaci6n localizado el sur de la subdivision de South Corrigan; la Hickory Regional Detention localizado el sur de la subdivision de Twin Creek Woods; y la formulaciOn de un plan de drenaje de agua de una tormenta para la Ciudad entera, y (4) para servicios profesionales. TESTIGUE MI MANO Y LA SELLA DE LA CIUDAD, este %/ dia de /i''4't , 1995. r ),,ir-xn-27-u.e. s...,t., 2 Secretaria de la Ciudad (I ter i n a) Ciudad de Pearland, Texas 0214897.01 039517/1600 MAYOR, DAY, CALDWELL 8 KEETON, L.L.P. 700 LOUISIANA, SUITE 1900 HOUSTON,TEXAS 77002-2778 (713)225-7000 100 CONGRESS AVENUE TELECOPIER(713)225-7047 SUITE 1500 RICK A.WITTE AUSTIN,TEXAS 78701-4042 PARTNER (5121 320-9200 225-7165 March 29, 1995 TE LECOPIER(5121320-9292 VIA LONE STAR OVERNIGHT Ms. Tommie Jean Vial City of Pearland, Texas 3519 Liberty Drive Pearland, Texas 77581 Re: City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995 Dear Ms. Vial: As you requested, I have enclosed a copy of the Resolution Authorization Publication of Notice of Intention to issue the referenced Certificates of Obligation. Please call me at (713) 225-7165 if you have any questions or need any additional information. Very truly yours, Rick A. Witte RAW:eag Enclosure 0217667.01 039529/1150 CERTIFICATE FOR RESOLUTION 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 a regular meeting on the 13th day of March, 1995, at the regular meeting place thereof, within the City, and the roll was called of the duly constituted officers and members of the City Council and the City Secretary, to wit: C.V. Coppinger Mayor D.A. Miller, Jr. Council Member Richard Tetens Council Member Randy K. Weber Council Member Jerry Richardson Council Member David L. Smith Council Member Tommie Jean Vial Interim City Secretary and all of such persons were present, thus constituting a quorum. Whereupon, among other business, the following was transacted at such meeting: a written RESOLUTION AUTHORIZING PUBLICATION OF NOTICE OF INTENTION TO ISSUE CERTIFICATES OF OBLIGATION IN A PRINCIPAL AMOUNT NOT TO EXCEED $5,500,000 FOR THE ACQUISITION, CONSTRUCTION AND IMPROVEMENT OF CERTAIN PUBLIC WORKS, AUTHORIZING DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT RELATING TO SUCH CERTIFICATES AND AUTHORIZING CERTAIN OTHER MATTERS RELATING THERETO (the "Resolution") was duly introduced for the consideration of the City Council and read in full. It was then duly moved and seconded that such Resolution be adopted; and, after due discussion, the motion, carrying with it the adoption of the Resolution, prevailed and carried by the following vote: AYES Q NOES 2. That a true, full and correct copy of the aforesaid Resolution adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been duly recorded in the City Council's minutes of the meeting; that the above and foregoing paragraph is a true, full and correct excerpt from the City Council's minutes of the meeting pertaining to the adoption of the Resolution; 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 purpose of the aforesaid meeting, and that the Resolution would be introduced and considered for adoption at the meeting, and each of the officers and members consented, in advance, to the holding of such meeting for such purpose; that the meeting was open to the public as required by law; and that public notice of the date, hour, place and subject of the meeting was given as required by the Open Meetings Law, Chapter 551, Texas Government Code, as amended. SIGNED AND SEALED this L day of March, 1995. 1 . Ariltritac2101- L�AiteLeCity Secretary ( Inte ) Mayor (pro-Tem City of Pearland, Texas City of Pearland, Tex (SEAL) 0212005.01 039513/1045 2 RESOLUTION NO. R95-15 RESOLUTION AUTHORIZING PUBLICATION OF NOTICE OF INTENTION TO ISSUE CERTIFICATES OF OBLIGATION IN A PRINCIPAL AMOUNT NOT TO EXCEED $5,500,000 FOR THE ACQUISITION, CONSTRUCTION AND IMPROVEMENT OF CERTAIN PUBLIC WORKS, AUTHORIZING DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT RELATING TO SUCH CERTIFICATES AND AUTHORIZING CERTAIN OTHER MATTERS RELATING THERETO STATE OF TEXAS § COUNTIES OF BRAZORIA AND HARRIS § CITY OF PEARLAND § WHEREAS, the City Council (the "City Council") of the City of Pearland, Texas (the "City"), is authorized to issue certificates of obligation to pay contractual obligations to be incurred for the construction of public works, for the purchase of materials, supplies, equipment, machinery, buildings, land and rights-of-way for authorized needs and purposes, and for professional services rendered in connection therewith pursuant to Texas Local Government Code sections 271.041-.064, as amended; WHEREAS, the City Council has determined that it is in the best interests of the City and otherwise desirable to issue certificates of obligation in a principal amount not to exceed $5,500,000 styled "City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995" (the "Certificates") for the acquisition, construction and improvement of certain public works to be used for authorized needs and purposes; WHEREAS, in connection with the Certificates, the City Council intends to publish notice of intent to issue the Certificates (the "Notice") in a newspaper of general circulation in the City; WHEREAS, for purposes of providing for the sale of the Certificates, this City Council intends to authorize the preparation of a Preliminary Official Statement(the"Preliminary Official Statement") to be used by the underwriters in the public offering of the Certificates; and WHEREAS, this City Council has been presented with and has examined the proposed form of Notice and finds that the form and substance thereof are satisfactory, and that the recitals and findings contained therein are true, correct and complete. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS: 1 Section 1. Preamble. The facts and recitations contained in the preamble of this Resolution are hereby found and declared to be true and correct. Section 2. Authorization of Notice. The City Secretary is hereby authorized and directed to execute and deliver the Notice set forth in Exhibit A hereto and to publish such Notice on behalf of the City in both English and Spanish once a week for two (2) consecutive weeks in a newspaper which is of general circulation in the City, the date of the first publication to be at least fifteen (15) days before the date tentatively set in the Notice for the passage of the ordinance authorizing the issuance of the Certificates. Section 3. Engagement of Professionals. This City Council hereby approves the engagement of certain professional firms in connection with the sale and delivery of the Certificates. Rauscher Pierce Refsnes, Inc., as financial advisor (the "Financial Advisor") and Mayor, Day, Caldwell & Keeton, L.L.P., as bond counsel ("Bond Counsel"), are hereby approved in connection with the issuance of the Certificates pursuant to the terms of the agreements with such professional firms in substantially the forms attached hereto as Exhibit B and Exhibit C, respectively. Section 4. Authorization of a Preliminary Official Statement. This City Council hereby approves the preparation and distribution by the Financial Advisor to prospective purchasers of the Certificates of the Preliminary Official Statement, as the same may be completed, modified, or supplemented with the approval of the Mayor or other authorized officers and agents of the City. Section 5. Authorization of Other Matters Relating Thereto. The Mayor, City Secretary and other officers and agents of the City are hereby authorized and directed to do any and all things necessary or desirable to carry out the provisions of this Resolution. Section 6. Effective Date. This Resolution shall take effect immediately upon passage. Section 7. Public Meeting. It is officially found, determined and declared that the meeting at which this Resolution is adopted was open to the public and public notice of the time, place and subject matter of the public business to be considered at such meeting, including this Resolution, was given all as required by the Texas Government Code, Chapter 551, as amended. 2 PASSED AND APPROVED this/3 day of March, 1995. Mayor (pro-Tern) City of Pearland, Texas ATTEST: AXM,LCI ktt./ (ete City Secretary (I n t rim) City of Pearland, Texas (SEAL) 0212005.01 039513/1045 3 EXHIBIT A TO RESOLUTION NOTICE OF INTENTION TO ISSUE CERTIFICATES NOTICE IS HEREBY GIVEN that the City Council of the City of Pearland, Texas (the "City") will meet at its regular meeting place at City Hall, Pearland, Texas at 7:30 p.m. on the 24th day of April, 1995, which is the time and place tentatively set for the passage of an ordinance and such other action as may be deemed necessary to authorize the issuance of the City's certificates of obligation, payable from ad valorem taxation and a subordinate pledge of certain revenues of the City's water and sewer system, in the maximum aggregate principal amount of$5,500,000, bearing interest at any rate or rates, not to exceed the maximum interest rate now or hereafter authorized by law, as shall be determined within the discretion of the City Council at the time of issuance and maturing over a period of years not to exceed forty (40) years from the date thereof, for the purpose of evidencing the indebtedness of the City to be incurred (1) for certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Lizer Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Lizer Road; renovations and improvements to Shadybend Drive (including drainage) from Liberty Drive to Misty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West Broadway and O'Day Road, (2) for renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's public library located at 3523 Liberty Drive, Pearland, Texas 77581, (3) for the acquisition, construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City-wide storm water drainage plan, and (4) for professional services. WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this 13th day of March, 1995. City Secretary ( Interim) City of Pearland, Texas (SEAL) 0212005.01 03951311045 EXHIBIT B TO RESOLUTION RAUSCHER PIERCE REFSNFS,INC. Frank J. Ildebrando March 13, 1995 Senior Vice President FINANCIAL ADVISORY CONTRACT Mayor and City Council City of Pearland Pearland, Texas Dear Council Members: 1. We understand that you desire this agreement from us to perform in the capacity of Financial Advisor for the City of Pearland, Texas (the "City") in connection with the issuance of Certificates of Obligation. 2. By this proposal we offer our professional services and our facilities to assist you in the authorization, issuance, sale and delivery of certificates of obligation (the "Securities"). We are to be compensated by the sale and delivery of such securities in accordance with the fee schedule as Appendix A. 3. We agree to perform the following duties and such other duties as, in our judgment, may be necessary or advisable: a We will make a study of the debt structure of your City, the trend of its assessed valuation, its taxing power and the present and estimated future taxing requirements. Such plan shall include a maturity schedule and other terms and conditions, such as options of prior payment and the like, as will, in our opinion, result in the issuance of the securities under terms and conditions most advantageous to your City consistent with a minimum effective interest rate. b. We understand that you will retain a firm of recognized municipal bond attorneys, who will prepare the proceedings and advise the steps necessary to be taken in the bond election if necessary, the legal issuance of the securities and the final delivery of the securities and who will issue an opinion approving the legality of the Securities. All services rendered pursuant to this contract will be performed in such manner, and will include assembling and accumulating such financial facts, information and data, as will be necessary or appropriate to obtain the unqualified approving legal opinion of the bond attorneys. The fee of said attorneys will be paid by the City. 1001 Fannin • Suite 700 • Ilou.ton, !c'. 77002 • CI 3)01-- 70 c. If it shall be decided to order a bond election, we will assemble and transmit to the bond attorneys such data as may be required in the preparation of the necessary petitions, orders, resolutions, notices and certificates; and will assist your governing body in the expeditious handling thereof. d. We will advise you of current bond market conditions, forthcoming bond issues and other general information and economic data which might normally be expected to influence interest rates so that the date for the sale of the Securities, in our opinion, will be favorable. e. We agree to assist in the preparation of an Official Statement or Prospectus, containing official data and other information of the nature and to the extent ordinarily required, all of which we are to furnish in a sufficient number of copies to permit mailing to prospective purchasers. Expenses related to printing and distribution of the Official Statement will be paid by the City. f. We will arrange for the printing of the Securities, with the cost to be paid by the City. 4. We will consult with you on the matter of bond ratings for the proposed issue and when so instructed, will direct the preparation of such information as in our opinion is required for submission to the bond rating agencies. In case it is considered advisable for personal presentation of information to the bond rating agencies, we will be available to accompany those representing the City for such presentation. All costs of any such presentation, including any fees or charges of the rating agencies and the cost of travel by our representative shall be at the expense of the City. 5. We agree to direct and coordinate the entire program of financing herein contemplated and to assume and pay for our own travel within the State of Texas, communication and out-of-pocket expenses incurred. It is specifically understood and agreed, however, that this obligation on our part shall not cover the cost of publication of notices in newspapers, or other publication cost, or the expenses of any litigation. 6. This agreement shall be terminated by the delivery of the Securities covered hereby, or by the lapse of 24 months from date of your acceptance hereof whichever shall first occur; however, if the securities have not been so delivered within the period specified, this agreement may be extended by mutual consent. 7. This proposal is submitted in duplicate and when accepted by you it will constitute the entire agreement between the City and the undersigned for the purposes and considerations herein specified. Respectfully submitted, RAUSCHER PIERCE REFSNES, INC. By: -%1 Frank J. ndebrando Senior Vice President ACCEPTANCE ACCEP 1'ED by the City of Pearland on this 13th day of March, 1995. City Manager • Al hST: City Secretary ( Interim) APPENDIX A FEE SCHEDULE IF THE AMOUNT OF SECURITIES ISSUED IS: MORE AND NOT THAN MORE THAN THl: FEE IS $ -0- $ 500,000 $ 5,000(minimum fee) $ 500,000 $ 1,000,000 $ 5,000 plus $5.00 per $1,000 for all over $500,000 $ 1,000,000 $ 5,000,000 $ 7,500 plus $2.50 per $1,000 for all over $1,000,000 $ 5,000,000 $10,000,000 $17,500 plus $1.25 per $1,000 for all over $5,000,000 $10,000,000 $20,000,000 $23,500 plus $1.00 per $1,000 for all over $10,000,000 $20,000,000 No limit $33,500 plus $0.40 per $1,000 for all over $20,000,000 HOURLY FEE(Projects unrelated to Bond Issue): • $150/Hour- Senior Professional 100/Hour-Technical Support 75/Hour-Clerical EXHIBIT C TO RESOLUTION MAYOR, DAY, CALDWELL 8 KEETON, L.L.P. 700 LOUISIANA, SUITE 1900 HOUSTON,TEXAS 77002-2778 (713)225-7000 100 CONGRESS AVENUE TE LECOPI ER(713)225-7047 SUITE 1500 AUSTIN,TEXAS 78701-4042 March 13, 1995 (512)320-9200 TELECOPIER(512)320-9292 Mayor and City Council City of Pearland, Texas P. O. Box 2068 Pearland, Texas 77588-2068 Re: $5,000,000 City of Pearland, Texas Tax and Revenue Certificates of Obligation, Series 1995 Dear Mayor and Council Members: We are pleased to submit to you a proposed agreement for Mayor, Day, Caldwell & Keeton, L.L.P. ("MDC&K"), Houston, Texas to serve as Bond Counsel with respect to the captioned certificates of obligation (the "Certificates"). When approved by you (the "City"), this letter will become effective and will evidence an agreement between the City and MDC&K. As Bond Counsel, we will prepare, or assist the appropriate City officials and staff in the preparation of, all required legal proceedings and will perform certain other necessary legal work in connection with the City's authorization, issuance and sale of the Certificates. Our services as Bond Counsel will include the following Basic Services, which we will carry out directly or in concert with City officials and staff, as follows: (1) Preparation of the ordinance authorizing the issuance of the Certificates (the "Ordinance") and all other legal instruments which comprise the transcript of legal proceedings pertaining to the authorization, issuance and sale of the Certificates; (2) Attendance at meetings called by the appropriate City officials and staff, to discuss the sizing, timing or sale of the Certificates; (3) Consultation with City officials and staff and the City's financial advisor to review information to be included in the offering documents for the Certificates, but only to the extent that such information describes the Certificates, the security therefor, its federal income tax status and our opinion; (4) Preparation and submission of a transcript of legal proceedings pertaining to the issuance of the Certificates to the Attorney General of Texas to obtain an approving opinion; City of Pearland, Texas March 13, 1995 Page 2 (5) Supervision of the printing of the Certificates and the delivery thereof to the purchasers, including, if requested, solicitation of bids from bond printers, to obtain the lowest responsible printing costs for the City; (6) At the closing of the Certificates, delivery of an approving opinion, based on facts and law existing as of its date, generally to the effect that the Certificates have been duly issued, executed and delivered in accordance with the Constitution and laws of the State of Texas, that the Certificates constitute valid and legally binding obligations of the City secured by a lien on and pledge of ad valorem taxes of the City pledged to their payment in the Ordinance (subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws in effect from time to time relating to or affecting the enforcement of rights of creditors of political subdivisions) and that, subject to certain restrictions, interest on the Certificates is excludable from the gross income of the owners thereof for federal income tax purposes under then existing law; provided that, after the closing, we do not undertake, unless specifically engaged by you to do so an Additional Service described below, to provide continuing advice concerning any actions necessary to assure that interest paid on the Certificates will continue to be excludable from gross income for federal income tax purposes; and (7) Prior to and in connection with the closing of the Certificates, giving advice to the City to enable appropriate officials to comply with the arbitrage requirements of the Internal Revenue Code of 1986 as they affect the Certificates, including yield restrictions and rebate requirements. In addition to the foregoing Basic Services, as Bond Counsel, we are prepared to undertake the following Additional Services, as directed by appropriate City officials; (1) Disclosure work or similar services (other than the limited review of certain sections of the offering documents for the Certificates as described in paragraph (3) under Basic Services above) to assist the City or its financial advisor in the preparation of such offering documents, on such basis and to such extent as shall be directed by the appropriate City officials and staff; (2) Attendance at rating agency presentations, investor meetings or other presentations relating to the marketing of the Certificates and consultation with City officials, staff and advisors to develop such presentations; (3) Preparation of "Blue Sky" surveys or securities registration services; (4) Any other special services not ordinarily required in connection with the issuance of obligations of the nature of the Certificates, including services rendered in connection with special federal income tax issues, unusual issues arising in connection with the City's financial City of Pearland, Texas March 13, 1995 Page 3 reports or audits, any documentation or related services for credit or liquidity facilities or enhancements or other special structuring techniques or devices to be employed in connection with the issuance of the Certificates; and (5) After the closing of the Certificates, providing assistance to the City concerning questions and issues that may arise prior to the maturity of the Certificates. For the Basic Services performed for the Certificates, MDC&K will be paid a fee of $7,500. Such fee shall be paid from the proceeds of the sale of the Certificates or from other funds, as the City deems appropriate. Except as otherwise provided below, payment of the fee shall be made after the issuance and delivery of the Certificates and within thirty (30) days after receipt by the City of an approved invoice therefor. The fee for any Additional Services provided by MDC&K will be determined on an hourly rate basis, using rates customarily charged by MDC&K to other clients for the same or similar services and taking into consideration the time consumed in providing the services, the level of expertise and ability of the attorneys performing the services and the difficulty and complexity of the tasks involved. The total fee for Additional Services prior to and in connection with the closing of the Certificates (other than fees for special services as described in paragraph (4) above under Additional Services) will not exceed such amount as is agreed to in writing by the City. MDC&K will be reimbursed for its reasonable and actual out-of-pocket expenses, such as the cost of reproduction of documents, out-of-town travel, long-distance telephone, telecopy and similar expenses, deliveries, filing fees and all items paid for by MDC&K on behalf of the City, incurred in connection with the performance of any services hereunder. All of such expenses will be reasonable. Nothing herein shall be construed as creating any personal liability on the part of any officer of the City, and this agreement may be terminated by the City by giving 30 days' written notice. City of Pearland, Texas March 13, 1995 Page 4 If this proposed agreement for the services of MDC&K as Bond Counsel is satisfactory, please evidence your acceptance and approval by executing three copies in the space provided below. Very truly yours, Rick A. Witte APPROVED: Mayor, C t Pearland (Pro-Tem ATTEST: • / eta, City Secretary, City of Pearland (Interim) 0211717.01 039513/1049 1 4. - ISL.\► 13:4U hi, U, Ublh h(.WSTON TEL: 713 225 7'047 P. 002 MAYOR, DAY, CALDWE LL 8 KE ETON, L.L P 700 LOUISIANA. SUITE 1900 HOUSTON,TEXAS 77002-2778 V1.11&5-/UUU 100 CONGRESS AVENUE TELECOPIERp131225-7047 SUITE Moo TUCK A WITTE AUSTIN.TF.XAA 7e7O1-.1042 PART14 EP. ;512/320-9200 225.7185 March 17, 1995 TELECOPIER15121320.9202 Mr. Richard Burdine City of Pcarland, Texas 3519 Liberty Drive Pearland, Texas T/j 81 Re: City of Pearland, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995 Dear Richard: As we discussed, I have enclosed the Notice of Intention to Issue Certificates in both F,nglish and Spanish for publication in the Pearl nd Reporter New*. This notice should be published on March 22 and March 29 as required by law. For the newspaper's convenience, I have also included a diskette containing the Notice in WordPerfect 5.1 format. Please call me at (713) 225-7165 if you have any questions on the enclosed or need any additional information. Very truly yours, Rick A. Witte RAW:eag Enclosure cc: T.J. Vial Frank Ildebrando .0214395.01 039517/1032 bir?,1(. -1'1 `13 I'011 13.40 i►1. u. GSh HUUSIUl1 TEL. 713 225 70:1- P. 003 NOTICE OF INY'Er'TIoN TO UE CERTjFICA1'ES NOTICE IS HEREBY GIVEN that the City Council of the City of Pearland, Texas (the "City") will meet at its regular meeting place at City Hall, Pearland, Texas at 7:30 p.m. on the 24th day of April, 1995, which is the time and place tentatively set for the passage of an ordinance and such other action as may be deemed necessary to authorize the issuance of the City's certificates of obligation, payable from ad valorem taxation and a subordinate pledge of certain revenues of the City's water and sewer system, in the maximum aggregate principal amount of$5,500,000,bearing interest at any rate or rates, not to exceed the maximum interest rate now or hereafter authorized by law, as shall be determined within the discretion of the City Council at the time of issuance and maturing over a period of years not to exceed forty (40) years from the date thereof, for the purpose of evidencing the indebtedness of tliC City to be incurred (1) for certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Lizer Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Lizer Road; renovations and improvements to Shadybend Drive (including drdinagC) (Loin Liberty Drive to Nfisty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West Broadway and O'Day Road, (2) for renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's public library located at 3523 Liberty Drive, Pearland, Texas 77581, (3) for the acquisition, construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City-wide storm water drainage plan, and (4) for professional services. WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this 13th day of March, 1995. City Secretary City of Pearland, Texas (SEAL) h1AR. -19' 95 (SUN) 13:41 M. D, C&1i HUSTON TEL: 113 225 "O4% P. OU4 NOTICIA DE lNJI'ENCIQN DE EMIY[R CERTIFI_CADOS TOME NOTICIA que el Consejo Municipal de la Ciudad de Pearland, Texas ("la Ciudad") se juntari en el sitio regular de juntas, el ayuntarnicnto dc Pcarland, Texas a las 7:30 p.m. el dia 24 de abril de 1995, el tiempo y lugar tentativamente programado para el pasaje de una ordenanza y tal otra aecion que consideren necesario para autorizar la emisidn de certificados de obligation de la Ciudad, siendo repartido de impuestos segun valor y una prenda de ciertas rentas publicas del sistema de agua y cloaca de la Ciudad en una cantidad principal maxim agregado de $5,500,000, devengando inters a cualquier valor o valores fijos, quc no exceden el valor de inters maximo ahora o despues de ser autorizado por ley, como sea dctcrminado dcntro Ia discrecuidn del Consejo Municipal al tiempo de emisipn y maduraciOn sobre un periodo de arms que no excede cuarenta (40) anos de esa fecha, con fin a evident iar la deuda que haya incurido la Ciudad, (1) para algunos proyectos de la calle localizadas en la Ciudad, incluyendo, pero no solamente, los siguieni : la adquisicidn de derecho de paso y la construction de una calle (incluyendo el drenaje) desde la calle John T.i7rr Road hasta la cane Main Street (SH 35); la adquisicidn de derecho de paso y la cuustruccion de una ealle (incluyendo el drenaje y trabajo en un puente) desde la calle Broadway (FM 518) hasta 1a calle John r.izer Road; las renovaciones y mejoramientos de la interseccidn de la ralle North Hatfield vieja y la calle North Hatfield nueva: y renovaciones y mejoramientos de las interserciones de la cane West Broadway, la calle Harkey Road y la mile O'Day Road, (2) para renovaciones, :nejoramientos, materiales, surtidos, equipo y maquinarias para cicrtos edificios y facilidades de la Ciudad incluyendo pero no solamente la biblioteca piiblica de la Ciudad localizado a 3523 Liberty Drive Pearland, Texas 77581, (3) la adquisicidn, construction, mejoramiento, reparacidn, materiales, surtidos, equipo y maquinaria para ciertas facilidades drenaje localizados en la Ciudad, incluyendo, pero no solamente: mejoramientos de controlar la inundacidn locaiizacln el sur de la subdivision de South Corrigan; la Hickory Regional Detention localizado el sur de la subdivisidn de Twin Creek Woods; y la formulation de un plan de drenaje de agua dc una tormenta para la Ciudad enterd, y (4) para servicios profesionales. TESTIGUE MI MANO Y LA SF' LA DE LA CIUDAD, este dia de , 1995. Secretaria de la Ciudad Ciudad de Pearland, Texas 0214897.01 039517/1600 Mk RAUSCHER PIERCE REFSNES,INC. Frank J. Ildebrando March 13, 1995 Senior Vice President FINANCIAL ADVISORY CONTRACT Mayor and City Council City of Pearland Pearland, Texas Dear Council Members: 1. We understand that you desire this agreement from us to perform in the capacity of Financial Advisor for the City of Pearland, Texas (the "City") in connection with the issuance of Certificates of Obligation. 2. By this proposal we offer our professional services and our facilities to assist you in the authorization, issuance, sale and delivery of certificates of obligation (the "Securities"). We are to be compensated by the sale and delivery of such securities in accordance with the fee schedule as Appendix A. 3. We agree to perform the following duties and such other duties as, in our judgment, may be necessary or advisable: a. We will make a study of the debt structure of your City, the trend of its assessed valuation, its taxing power and the present and estimated future taxing requirements. Such plan shall include a maturity schedule and other terms and conditions, such as options of prior payment and the like, as will, in our opinion, result in the issuance of the securities under terms and conditions most advantageous to your City consistent with a minimum effective interest rate. b. We understand that you will retain a firm of recognized municipal bond attorneys, who will prepare the proceedings and advise the steps necessary to be taken in the bond election if necessary, the legal issuance of the securities and the final delivery of the securities and who will issue an opinion approving the legality of the Securities. All services rendered pursuant to this contract will be performed in such manner, and will include assembling and accumulating such financial facts, information and data, as will be necessary or appropriate to obtain the unqualified approving legal opinion of the bond attorneys. The fee of said attorneys will be paid by the City. 1001 Fannin • Suite 700 • Houston,Texas 77002 • (713)651-3370 Member New York Stock Exchange, Inc. c. If it shall be decided to order a bond election, we will assemble and transmit to the bond attorneys such data as may be required in the preparation of the necessary petitions, orders, resolutions, notices and certificates; and will assist your governing body in the expeditious handling thereof. d. We will advise you of current bond market conditions, forthcoming bond issues and other general information and economic data which might normally be expected to influence interest rates so that the date for the sale of the Securities, in our opinion, will be favorable. e. We agree to assist in the preparation of an Official Statement or Prospectus, containing official data and other information of the nature and to the extent ordinarily required, all of which we are to furnish in a sufficient number of copies to permit mailing to prospective purchasers. Expenses related to printing and distribution of the Official Statement will be paid by the City. f. We will arrange for the printing of the Securities, with the cost to be paid by the City. 4. We will consult with you on the matter of bond ratings for the proposed issue and when so instructed, will direct the preparation of such information as in our opinion is required for submission to the bond rating agencies. In case it is considered advisable for personal presentation of information to the bond rating agencies, we will be available to accompany those representing the City for such presentation. All costs of any such presentation, including any fees or charges of the rating agencies and the cost of travel by our representative shall be at the expense of the City. 5. We agree to direct and coordinate the entire program of financing herein contemplated and to assume and pay for our own travel within the State of Texas, communication and out-of-pocket expenses incurred. It is specifically understood and agreed, however, that this obligation on our part shall not cover the cost of publication of notices in newspapers, or other publication cost, or the expenses of any litigation. 6. This agreement shall be terminated by the delivery of the Securities covered hereby, or by the lapse of 24 months from date of your acceptance hereof, whichever shall first occur; however, if the securities have not been so delivered within the period specified, this agreement may be extended by mutual consent. 7. This proposal is submitted in duplicate and when accepted by you it will constitute the entire agreement between the City and the undersigned for the purposes and considerations herein specified. Respectfully submitted, RAUSCHER PIERCE REFSNES, INC. By: o4. Frank J. Iidebrando Senior Vice President ACCEPTANCE ACCEPTED by the City of Pearland on this 13th day of March, 1995. jj.),i.,\L„ '- Manager ATTEST: V 'l'��i�liC2� freiV ity Secretary ( I n t e i m) APPENDIX A FEE SCHEDULE IF THE AMOUNT OF SECURITIES ISSUED IS: MORE AND NOT THAN MORE THAN THE FEE IS $ -0- $ 500,000 $ 5,000 (minimum fee) $ 500,000 $ 1,000,000 $ 5,000 plus $5.00 per $1,000 for all over $500,000 $ 1,000,000 $ 5,000,000 $ 7,500 plus $2.50 per $1,000 for all over $1,000,000 $ 5,000,000 $10,000,000 $17,500 plus $1.25 per $1,000 for all over $5,000,000 $10,000,000 $20,000,000 $23,500 plus $1.00 per $1,000 for all over $10,000,000 $20,000,000 No limit $33,500 plus $0.40 per $1,000 for all over $20,000,000 HOURLY FEE(Projects unrelated to Bond Issue): • $150/Hour- Senior Professional 100/Hour-Technical Support • 75/Hour-Clerical MAYOR, DAY, CALDWELL 8 KEETON, L.L.P. 700 LOUISIANA, SUITE 1900 HOUSTON,TEXAS 77002-2778 (713)225-7000 100 CONGRESS AVENUE TELECOPIER(713)225-7047 SUITE 1500 AUSTIN,TEXAS 78701-4042 (512)320-9200 March 13, 1995 TELECOP[ER(512)320-9292 Mayor and City Council City of Pearland, Texas P. O. Box 2068 Pearland, Texas 77588-2068 Re: $5,000,000 City of Pearland, Texas Tax and Revenue Certificates of Obligation, Series 1995 Dear Mayor and Council Members: We are pleased to submit to you a proposed agreement for Mayor, Day, Caldwell & Keeton, L.L.P. ("MDC&K"), Houston, Texas to serve as Bond Counsel with respect to the captioned certificates of obligation (the "Certificates"). When approved by you (the "City"), this letter will become effective and will evidence an agreement between the City and MDC&K. As Bond Counsel, we will prepare, or assist the appropriate City officials and staff in the preparation of, all required legal proceedings and will perform certain other necessary legal work in connection with the City's authorization, issuance and sale of the Certificates. Our services as Bond Counsel will include the following Basic Services, which we will carry out directly or in concert with City officials and staff, as follows: (1) Preparation of the ordinance authorizing the issuance of the Certificates (the "Ordinance") and all other legal instruments which comprise the transcript of legal proceedings pertaining to the authorization, issuance and sale of the Certificates; (2) Attendance at meetings called by the appropriate City officials and staff, to discuss the sizing, timing or sale of the Certificates; (3) Consultation with City officials and staff and the City's financial advisor to review information to be included in the offering documents for the Certificates, but only to the extent that such information describes the Certificates, the security therefor, its federal income tax status and our opinion; (4) Preparation and submission of a transcript of legal proceedings pertaining to the issuance of the Certificates to the Attorney General of Texas to obtain an approving opinion; City of Pearland, Texas March 13, 1995 Page 2 (5) Supervision of the printing of the Certificates and the delivery thereof to the purchasers, including, if requested, solicitation of bids from bond printers, to obtain the lowest responsible printing costs for the City; (6) At the closing of the Certificates, delivery of an approving opinion, based on facts and law existing as of its date, generally to the effect that the Certificates have been duly issued, executed and delivered in accordance with the Constitution and laws of the State of Texas, that the Certificates constitute valid and legally binding obligations of the City secured by a lien on and pledge of ad valorem taxes of the City pledged to their payment in the Ordinance (subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws in effect from time to time relating to or affecting the enforcement of rights of creditors of political subdivisions) and that, subject to certain restrictions, interest on the Certificates is excludable from the gross income of the owners thereof for federal income tax purposes under then existing law; provided that, after the closing, we do not undertake, unless specifically engaged by you to do so an Additional Service described below, to provide continuing advice concerning any actions necessary to assure that interest paid on the Certificates will continue to be excludable from gross income for federal income tax purposes; and (7) Prior to and in connection with the closing of the Certificates, giving advice to the City to enable appropriate officials to comply with the arbitrage requirements of the Internal Revenue Code of 1986 as they affect the Certificates, including yield restrictions and rebate requirements. In addition to the foregoing Basic Services, as Bond Counsel, we are prepared to undertake the following Additional Services, as directed by appropriate City officials; (1) Disclosure work or similar services (other than the limited review of certain sections of the offering documents for the Certificates as described in paragraph (3) under Basic Services above) to assist the City or its financial advisor in the preparation of such offering documents, on such basis and to such extent as shall be directed by the appropriate City officials and staff; (2) Attendance at rating agency presentations, investor meetings or other presentations relating to the marketing of the Certificates and consultation with City officials, staff and advisors to develop such presentations; (3) Preparation of "Blue Sky" surveys or securities registration services; (4) Any other special services not ordinarily required in connection with the issuance of obligations of the nature of the Certificates, including services rendered in connection with special federal income tax issues, unusual issues arising in connection with the City's financial City of Pearland, Texas March 13, 1995 Page 3 reports or audits, any documentation or related services for credit or liquidity facilities or enhancements or other special structuring techniques or devices to be employed in connection with the issuance of the Certificates; and (5) After the closing of the Certificates, providing assistance to the City concerning questions and issues that may arise prior to the maturity of the Certificates. For the Basic Services performed for the Certificates, MDC&K will be paid a fee of $7,500. Such fee shall be paid from the proceeds of the sale of the Certificates or from other funds, as the City deems appropriate. Except as otherwise provided below, payment of the fee shall be made after the issuance and delivery of the Certificates and within thirty (30) days after receipt by the City of an approved invoice therefor. The fee for any Additional Services provided by MDC&K will be determined on an hourly rate basis, using rates customarily charged by MDC&K to other clients for the same or similar services and taking into consideration the time consumed in providing the services, the level of expertise and ability of the attorneys performing the services and the difficulty and complexity of the tasks involved. The total fee for Additional Services prior to and in connection with the closing of the Certificates (other than fees for special services as described in paragraph (4) above under Additional Services) will not exceed such amount as is agreed to in writing by the City. MDC&K will be reimbursed for its reasonable and actual out-of-pocket expenses, such as the cost of reproduction of documents, out-of-town travel, long-distance telephone, telecopy and similar expenses, deliveries, filing fees and all items paid for by MDC&K on behalf of the City, incurred in connection with the performance of any services hereunder. All of such expenses will be reasonable. Nothing herein shall be construed as creating any personal liability on the part of any officer of the City, and this agreement may be terminated by the City by giving 30 days' written notice. City of Pearland, Texas March 13, 1995 Page 4 If this proposed agreement for the services of MDC&K as Bond Counsel is satisfactory, please evidence your acceptance and approval by executing three copies in the space provided below. Very truly yours, Rick A. Witte APPROVED: uti Mayor ity of Pearland (Pro-Tem) ATTEST: 7:t14-4(1)/i, City Secretary, City o Pearland (Interim) 0211717.01 039513/1049 ��� PEAR9 Cnl � of o coc� 0 0rrllondz �J C7 *rEXAs* 3519 Liberty Drive • Pearland, Texas 77581-5416 (713) 485-2411 • fax (713) 485-8764 AGENDA ITEM To: Mayor and City Council Through: Paul Grohman, City Manager U, From: Richard Burdine, Assistant City Manager Subject : Resolution R95-15 Authorizing Publication of Notice of Intention to Issue Certificates of Obligation in a Principal Amount Not to Exceed $5, 500 ,000 , et cetera Date: March 7 , 1995 The attached documents relate to this agenda item. Reference them by the number in the top right hand corner of the page, as follows : Page 1 - Schedule of Events for Issuance of $5 ,000 ,000 Certificates of Obligation Series 1995; Pages 2 to 4 - The Resolution; Page 5 - Exhibit A - Notice of Intention to Issue Certificates of Obligation; Pages 6 to 9 - Exhibit B - Financial Advisory Contract ; Pages 10 to 13 - Exhibit C - Bond Counsel Contract ; Page 14 - Principle and Interest Schedule for 1995 Issue; Page 15 - Series 1995 with Present Debt Requirement ; and, Page 16 - Total Debt Service Plus Series 1995 to Maintain a $0 . 26 Debt Service Tax Rate. Page 16 illustrates that the proposed $5 , 000 ,000 issue will not require a tax increase for debt service, maintaining the current $0 . 26/$100 rate. A 3% per year growth in the property tax base is assumed; the average increase for the last ten years is 7% . Also assumed is a gradual draw down of the Debt Service Fund balance from the current 50% of annual requirements to 25%. The balance can only be used for debt service . Recall that last year our auditors reviewed all fund balance needs and suggested 25% for this one . The City' s financial advisor agrees with the auditors ' recommendation. Action: 0 a-nted on Recycled Pape' 2 3/6/95 RESOLUTION AUTHORIZING PUBLICATION OF NOTICE OF INTENTION TO ISSUE CERTLHCATES OF OBLIGATION IN A PRINCIPAL AMOUNT NUT T'J EXCEED 15,500,000 FOR THE ACQUISITION, CONSTRUCTION AND IMPROVEMENT OF CERTAIN PUBLIC WORKS, AUTHORIZING DISTRIRi1TION OF A PRELIMINARY OFFICIAL STATEMENT RELATING TO SUCH CERTIFICATES AND AIJ T IORI7JNC; CERTAIN OTHER MATTERS RELATING THERETO STATE OF TEXAS COUNTIES OF IIRAZORIA AND HARRIS $ CITY OF PEARLAND WHEREAS, the City Council (the "City Council") of the City of Pearland, Texas (the "City"), is authorized to issue certificates of obligation to pay coot ctual obligations to be incurred for the construction of public works, for the purchase of materials, supplies, equipment, mact lnery, buildings, land and rights-of-way for authorized needs and purposes, and for professional services rendered in connection therewith punsuant to Texas Local Government Code sections 271.041-.064, as amended; WHEREAS, the City Council has determined that it is in the best interests of the City and otherwise desirable to issue certificates of obligation in a principal amount not to meed $5, 00,000 styled "City of Peariand, Texas Combination Tax and Revenue Certificates of Obligation, Series 1995" (the "Certificates") for the acquisition, constnicdon and improvement of certain public works to be used for authorized needs and purposes; WHEREAS, in connection with the Certifi tes, the City Council intends to publish notice of intent to issue Me Certificates (the `Notice") in a newspaper of general circulation in the City; WHEREAS, for purposes of pro Mciing for tine sale of the Certificates, this City Council intends to authorize the preparation of a Preliminary Official Statement(the "Preliminary Official Statement") to be used by the underwriters in die public offering of the Certificates; and WHEREAS, this City Council has been presented with and has examined the proposed form of Notice and finds that the form and substance thereof are satisfactory, and that the recitals and findings contained therein are true, correct and complete. BE IT RESOLVED BY '[HE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS: 3 Section 1. Preamble. The facts and recitations contained in the preamble of this Resolution are hereby found and declared to be true and curet. eection 2. Atithorizatoo of Notice. The City Secretary is hereby authorized and directed to execute and deliver the Notice set forth in Exhibit A hereto and to publish such Notice on behalf of the City in both English and Spanish once a week for two (2) consecutive weeks in a newspaper which is of general circulation in the City, the date of the first publication to be at least fifteen (15) days before the date tentatively set in the Notice for the passage of the ordinance authorizing the issuance of the Certificates, won 3. Engagement of Profegaionall. This City Council hereby approver; the engagement of chin professional firms in connection with the sale and delivery of the Certificates. Rauscher Pierce Refsnes, Inc., as financial advisor (the "Financial Advice") and Mayor, Day, Caldwell & Keeton, L.I..P., as bond counsel ("Bond Counsel"), are hereby approved in connection with the issuance of the Certificates pumuant to the terms of the agreements with such professional firms in substantially the forms attached hereto as Exhibit B and Exhibit C, restively. , Lion 4. $nitJ-torization a Prclinrinar Q.fficial Statement. This City Council hereby approves the preparation and distribution by the Financial Advisor to prospective purchasers of die Certificates of the Preliminary Official Statement, as the same may be completed, modified, or supplemented with the approval of the Mayor or other authorized officers and agents of the City. Secttoni. Authodtion of Other Matters Relating Thereto. The Mayor, City Secretary and other officers and agents of the City are hereby authorized and directed to do any and all things necessary or desirable to carry out the provisions of this Resolution. ;action 6. Effective Date. This Resolution shall take effect immediately upon passage. Section 7. Public.ng. It is officially found, determined and declared that the meeting at which this Resolution is adopted was open to the public and public notice of the time, place and subject matter of the public business to be considered at such meeting. including this Resolution,was given all as required by the Texas Government Code, Chapter 551,as amended. 4 PASSED AND APPROVED this—day of March, 1995. Mayor City of Pearland, Texas ATTEST: City Secxetary City of Pearland, Teams (Sue) a3t2006.o1 039606/1415 5 EXHIBIT A TO RESOLUTION ION CF On-NTF Odq To ISSJJ .CERTIFICATES NOTICE IS HEREBY GIVEN that the City Council of the City of Pearland, Texas (the "City") will meet at its regular meeting place at City Hall, Fear and, Texas at 7:30 p.m. on the 24th day of April, 1995, which is the time and place tentatively set for the passage of an ordinance and such other action as may be deemed necessary to authorize the issuance of the City's certificates of obligation, payable from ad valorem taxation and a vubordinate pledge of certain revenues of the City's water and sewer system, in the maximum aggregate principal amount of$5,500,000, bearing interest at any rate or rates, not to exceed the maximum interest rate now or hereafter authorized by law, as shall be determined within the discretion of the City Council at the time of issuance and maturing over a period of years not to exceed forty (40) years from the date thereof, for the purpose of evidencing the indebtedness of the City to be incurred (1) for certain street projects located in the City including but not limited to: the acquisition of right of way and construction of a street (including drainage) from John Liar Road to Main Street (SH 35); acquisition of right of way and construction of a street (including drainage and bridge work) from Broadway (FM 518) to John Liver Road; renovations and improvements to Shadybend Drive (including drainage) from Liberty Drive to Misty Street; renovations and improvements to the intersection of Walnut Drive and McLean Road; renovations and improvements to the intersection of old and new North Hatfield Roads; and renovations and improvements of the intersections of West Broadway and Harkey Road and West Broadway and O'Day Road, (2) for renovations, improvements, materials, supplies, equipment and machinery for certain City buildings and facilities including but not limited to the City's public library located at 3523 Liberty Drive, Pearland, Texas 77581, (3) for the acquisition, construction, improvement, repair, materials, supplies, equipment and machinery for certain drainage facilities located in the City including but not limited to: flood control improvements south of the South Corrigan subdivision; the Hickory Regional Detention located south of the Twin Creek Woods subdivision; and formulation of a City-wide storm water drainage plan, and (4) for professional services. WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this 13th day of March, 1995. City Secretary City of Pearland, Texa (SEAL) 02r2005.v1 (39505/1757 EXHIBIT B TO RESOLUTION 6 Rek RAUSCHER PIERCE REFSN ES,INC. Frank J. lidebrando March 13 1995 Senior(rice President ' FINANCIAL ADVISORY CONTRACT Mayor and City Council City of Pearland Peariand, Texas Dear Council Members: 1. We understand that you desire this agreement from us to perform in the capacity of Financial Advisor for the City of Pearland, Texas (the "City") in connection with the issuance of Certificates of Obligation. 2. by this proposal we offer our professional services and our facilities to assist you in the authorization, issuance, sale and delivery of certificates of obligation (the "Securities"). We are to be compensated by the sale and delivery of such securities in accordance with the fee schedule as Appendix A 3. We agree to perform the following duties and such other duties as, in our judgment, may be necessary or advisable; a. We will make a study of the debt structure of your City, the trend of its assessed valuation,its taxing power and the present and estimated future taxing requirements. Such plan shall include a maturity schedule and other terms and conditions, such as options of prior payment and the like, as will, in our opinion, result in the issuance of the securities under terms and conditions most advantageous to your City consistent with a minimum effective interest rate. b. We understand that you will retain a tirm of recognized municipal bond attorneys, who will prepare the proceedings and advise the steps necessary to be taken in the bond election if necessary, the legal issuance of the securities and the final delivery of the securities and who will issue an opinion approving the Legality of the Securities. All services rendered pursuant to this contract will be performed in such manner, and will include assembling and accumulating such financial facts, information and data, as will be necessary or appropriate to obtain the unqualified approving legal opinion of the bond attorneys. The fee of said attorneys will be paid by the City. 1001 Fannii • Suite 700 • Houston,'i'exac 77002 • (713)651-3370 Mends&New York Stuck Exchange,Inc. 7 c. If it shall be decided to order a bond election, we will assemble and transmit to the bond attorneys such data as may he required in the preparation of the necessary petitions, orders, resolutions, notices and certificates; and will assist your governing body in the expeditious handling thereof. d. We will advise you of current bond market conditions,forthcoming bond issues and other general information and economic data which might normally be expected to influence interest rates so that the date for the sale of the Securities, in our opinion, will be favorable. e. We agree to assist in the preparation of an Official Statement or Prospectus, containing official data and other information of the nature and to the extent ordinarily required, all of which we are to furnish in a sufficient number of copies to peuuit mailing to prospective purchasers. expenses related to printing and distribution of the Official Statement will be paid by the City. f We will arrange for the printing of the Securities, with the cost to be paid by the City. 4. We will consult with you on the matter of bond ratings for the proposed issue and when so instructed, will direct the preparation of such information as in our opinion is required for submission to the bond rating agencies In c:ace it is considered advisable for personal presentation of information to the bond rating agencies, we will be available to accompany those representing the City for such presentation. All costs of any such pi esentation, including any fees or charges of the rating agencies and the cost of travel by our representative shall be at the expense of the City. 5 We agree to direct and coordinate the entire program of financing herein contemplated and to assume and pay for our own travel within the State of Texas,communication and out-of-pocket ei►praiscs incuu1Cd. IL is specifically understood and agreed, however, that this obligation on our part shall not cover the cost of publication of notices in newspapers, or other publication cost, or the expenses of any litigation. 6. This agreement shall be terminated by the delivery of the Securities covered hereby, or by the lapse of 24 months from date of your acceptance her rxi whichever shall first occur; however, if the securities have not been so delivered within the period specified, this agreement may be extended by mutual consent. kitriames STD • ta` ra kith -S661 `( IENjo i(p g1£I site uo Pue1JdJo Q3icMTT 3IDNVId3.0DV 1UapTc Id°1!A InT2S opuVQGP'1't3 $ DM`S ISd3x 3ZYT3Id 2T SilVIi `pailnugns Xntjadsag 'pagraads araraq suo9grap!sun0 pug sgsodtrid a .103 p u S3'Pun a ptrg Aro atp uaa^fit lumina-en arraua 341 arn4nsuoa ll not fig pavdao uatim pus amiidnp in pawnugns si fesodoid siy 8 9 APPENDIX A FEE SCI{ED LE IF THE AMOUNT OF SECURITIES ISSUED IS: MORE AND NOT THAN MORE THAN Till;r'EE IS $ -0- $ 500,000 $ 5,000(minimum fee) $ 500,000 $ 1,000,000 $ 5,000 plus $5.00 per $1,000 for all over $500,000 $ 1,000,000 $ 5,000,000 $ 7,500 plus $2.50 per $1,000 for all over $1,000,000 $ 5,000,000 $10,000,000 $17,500 plus$1.25 per $1,000 for all over $5,000,000 $10,000,000 $20,000,000 $23,500 plus $1.00 per $1,000 for all over $10,000,000 ' $20,000,000 No limit $33.500 plus $0.40 per $1,000 for all over $20,000,000 HOURLY FEE(Projects unrelated to Bond Issue): • $150/Iiour- Senior Professional • 100/Hour-Technical al Support • 75/Hour-Clerical OBIT C TO RESOLUTION 10 MAYOR, DAY, CALDWELL 8 KEETON, L.L.P 700 LOUISIANA. SUITE 1900 HOUSTON,TEXAS 77002 2776 (713)225-7000 too coNC2ess AVENUE TELECOPIER713)225-7047 51.11TE 150C AUSTIN,TEXAS 78701-4042 (St2)320-9200 march 6, 1995 TELECOPIER312}320-9292 Mayor and City Council City of Pearland, Texas P. O. Box 2068 Pearland, Texas 77588-2068 Re: $5,000,000 City of Pearland, Texas Tax and Revenue Certificates of Obligation, Series 1995 Dear Mayor and Council Members: We are pleased to submit to you a proposed agreement for Mayor, Day, Caldwell & Keeton, L.L.P. ("MDC&K"), Houston, Texas to serve as Bond Counsel with respect to the captioned certificates of obligation(the "Certificates"). When approved by you (the "City"),this letter will become effective and will evidence an agreement between the City and iviDC&K. As Bond Counsel, we will prepare, or assist the appropriate City officials and staff in the preparation of, all required legal proceedings and will perform certain other necessary legal work in connection with the City's authorization, issuance and sale of the Certificates. Our services as Bond Counsel will include the following Basic Services, which we will carry out directly or in concert with City officials and staff, as follows: (1) Preparation of the ordinance authorizing the issuance of the Certificates (the "Ordinance") and all other legal instruments which comprise the transcript of legal proceedings pertaining to the authorization, issuance and sale of the Certificates; (2) Attendance at meetings called by the appropriate City officials and staff,to discuss the sizing, timing or sale of the Certificates; (3) Consultation with,City officials and staff and the City's financial advisor to review information to be included in the offering documents for the Certificates, but only to the extent that such information describes the Certificates, the security therefor, its federal income tax status and our opinion..; (4) Preparation and submission of a transcript of legal proceedings pertaining to the issuance of the Certificates to the Attorney General of Texas to obtain an approving opinion; 11 City of Pearland, Texas March 6, 1995 Page 2 (5) Supervision of the printing of the Certificates and the delivery thereof to the purchasers, including, if requested, solicitation of bids from bond printers, to obtain the lowest responsible printing costs for the City; (6) At the closing of the Certificates, delivery of an approving opinion, based on facts and law existing as of its date, generally to the effect that the Certificates have been duly issued, executed and delivered in accordance with the Constitution and laws of the State of Texas, that the Certificates constitute valid and legally binding obligations of the City secured by a lien on and pledge of ad valorem taxes of the City pledged to their payment in the Ordinance (subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws in effect from time to time relating to or affecting the enforcement of rights of creditors of political subdivisions) and that, subject to certain restrictions, interest on the Certificates is excludable from the gross income of the owners thereof for federal income tax purposes under then existing law; provided that, after the closing, we do not undertake, unless specifically engaged by you to do so an Additional Service described below, to provide continuing advice concerning any actions necessary to assure that interest paid on the Certificates will continue to be excludable from gross income for federal income tax purposes; and (7) Prior to and in connection with the closing of the Certificates, giving advice to the City to enable appropriate officials to comply with the arbitrage requirements of the Internal Revenue Code of 1986 as they affect the Certificates, including yield restrictions and rebate requirements. In addition to the foregoing Basic Services, as Bond Counsel, we are prepared to undertake the following Additional Services, as directed by appropriate City officials; (1) Disclosure work or similar services (other than the limited review of certain sections of the offering documents for the Certificates as described in paragraph (3) under Basic Services above) to assist the City or its financial advisor in the preparation of such offering documents, on such basis and to such extent as shall be directed by the appropriate City officials and staff; (2) Attendance at rating agency presentations,investor meetings or other presentations relating to the marketing of the Certificates and consultation with City officials, staff and advisors to develop such presentations; (3) Preparation of "Blue Sky" surveys or securities registration services; (4) Any other special services not ordinarily required in connection with the issuance of obligations of the nature of the Certificates, including services rendered in connection with special federal income tax issues, unusual issues arising in connection with the City's financial 12 City of Pearland, Texas March 6, 1995 Page 3 reports or audits, any documentation or related services for credit or liquidity facilities or enhancements or other special structuring techniques or devices to be employed in connection with the imwince of the Certificates; and (5) After the closing of the Certificates, providing assistance to the City concerning questions and issues that may arise prior to the maturity of the Certificates. For the Basic Services performed for the Certificates, MDC&K will be paid a fee of $7,500. Such fee shall be paid from the proceeds of the sale of the Certificates or from other funds, as the City deems appropriate. Except as otherwise provided below, payment of the fee shall be made after the issuance and delivery of the Certificates and within thirty (30) days after receipt by the City of an approved invoice therefor. The fee for any Additional Services provided by MDC&K will be determined on an hourly rate basis, using rates customarily charged by MDC&K to other clients for the same or similar services and taking into consideration the time consumed in providing the services, the level of expertise and ability of the attorneys performing the services and the difficulty and complexity of the tasks involved. The total fee for Additional Services prior to and in connection with the closing of the Certificates (other than fees for special services as described in paragraph (4) above under Additional Services) will not exceed such amount as is agreed to in writing by the City. MDC&K will be reimbursed for its reasonable and actual out-of-pocket expenses, such as the cost of reproduction of documents, out-of-town travel, long-distance telephone, telecopy and similar expenses, deliveries, filing fees and all items paid for by MDC&K on bi half of the City, incurred in connection with the performance of any services hereunder. All of such expenses will be reasonable. Nothing herein shall be construed as creating any personal liability on the part of any officer of the City, and this agreement may be terminated by the City by giving 30 days' written notice. 13 City of Pearland, Texas March 6, 1995 Page 4 If this proposed agreement for the services of MDC&K as Bond Counsel is satisfactory, please evidence your acceptance and approval by executing three copies in the space provided below. Very truly yours, Rick A. Witte APPROVED: Mayor, City of Pearland ATTEST: City Secretary, City of Pearland 0211717.01 039506/1419 CITY OF PEARLAND Issue Date: 5/01/95 CERTIFICATES OF OBLIGATION Delivery Date: 5/01/95 SERIES 1995 MATURING COUPON INTEREST TOTAL FISCAL YEAR DATES PRINCIPAL PROCEEDS RATE YIELD PRICE AMOUNT DEBT SERVICE TOTAL 3/01/96 250,000.00 250,000.00 9/01/96 150,000.00 150,000.00 400,000.00 3/01/97 130,000 130,000.00 6.000 6.000000 100.000000 150,000.00 280,000.00 9/01/97 146,100.00 146,100.00 426,100.00 3/01/98 140,000 140,000.00 6.000 6.000000 100.000000 146,100.00 286,100.00 9/01/98 141,900.00 141,900.00 428,000.00 3/01/99 150,000 150,000.00 6.000 6.000000 100.000000 141,900.00 291,900.00 9/01/99 137,400.00 137,400.00 429,300.00 3/01/00 155,000 155,000.00 6.000 6.000000 100.000000 137,400.00 292,400.00 9/01/00 132,750.00 132,750.00 425,150.00 3/01/01 165,000 165,000.00 6.000 6.000000 100.000000 132,750.00 297,750.00 9/01/01 127,800.00 127,800.00 425,550.00 3/01/02 175,000 175,000.00 6.000 6.000000 100.000000 127,800.00 302,800.00 9/01/02 122,550.00 122,550.00 425,350.00 3/01/03 185,000 185,000.00 6.000 6.000000 100.000000 122,550.00 307,550.00 9/01/03 117,000.00 117,000.00 424,550.00 3/01/04 200,000 200,000.00 6.000 6.000000 100.000000 117,000.00 317,000.00 9/01/04 111,000.00 111,000.00 428,000.00 3/01/05 210,000 210,000.00 6.000 6.000000 100.000000 111,000.00 321,000.00 9/01/05 104,700.00 104,700.00 425,700.00 3/01/06 225,000 225,000.00 6.000 6.000000 100.000000 104,700.00 329,700.00 9/01/06 97,950.00 97,950.00 427,650.00 3/01/07 240,000 240,000.00 6.000 6.000000 100.000000 97,950.00 337,950.00 9/01/07 90,750.00 90,750.00 428,700.00 3/01/08 255,000 255,000.00 6.000 6.000000 100.000000 90,750.00 345,750.00 9/01/08 83,100.00 83,100.00 428,850.00 3/01/09 270,000 270,000.00 6.000 6.000000 100.000000 83,100.00 353,100.00 9/01/09 75,000.00 75,000.00 428,100.00 3/01/10 500,000 500,000.00 6.000 6.000000 100.000000 75,000.00 575,000.00 9/01/10 60,000.00 60,000.00 635,000.00 3/01/11 500,000 500,000.00 6.000 6.000000 100.000000 60,000.00 560,000.00 9/01/11 45,000.00 45,000.00 605,000.00 3/01/12 . 500,000 500,000.00 6.000 6.000000 100.000000 45,000.00 545,000.00 9/01/12 30,000.00 30,000.00 575,000.00 3/01/13 500,000 500,000.00 6.000 6.000000 100.000000 30,000.00 530,000.00 9/01/13 15,000.00 15,000.00 545,000.00 3/01/14 500,000 500,000.00 6.000 6.000000 100.000000 15,000.00 515,000.00 515,000.00 5,000,000 5,000,000.00 3,826,000.00 8,826,000.00 8,826,000.00 Acc Int 0.00 0.00 Totals 5,000,000 5,000,000.00 3,826,000.00 8,826,000.00 TIC (Incl. all expenses) 5.99440128% Average Coupon 6.00000000% TIC (Arbitrage TIC) 5.99440128% Average Life (yrs) 12.75 Bond Years 63,766.67 WAM (yrs) 12.753333 PEARC95: NEW95 03/02/95 a 16:49 CITY OF PEARLAND CERTIFICATES OF OBLIGATION SERIES 1995 INTEREST INTEREST PRESENT PRINCIPAL a 6.000% a 6.000% TOTAL TOTAL NEW TOTAL DEBT YEAR ENDING DEBT DUE DUE DUE NEW PRINCIPAL SERVICE 09/30 REQUIREMENT 03/01 03/01 09/01 INTEREST & INTEREST REQUIREMENT 1995 2,033,151 2,033,151 1996 2,028,804 250,000 150,000 400,000 400,000 2,428,804 1997 2,026,184 130,000 150,000 146,100 296,100 426,100 2,452,284 1998 2,033,471 140,000 146,100 141,900 288,000 428,000 2,461,471 1999 2,023,969 150,000 141,900 137,400 279,300 429,300 2,453,269 2000 2,025,169 155,000 137,400 132,750 270,150 425,150 2,450,319 2001 2,027,266 165,000 132,750 127,800 260,550 425,550 2,452,816 2002 2,021,556 175,000 127,800 122,550 250,350 425,350 2,446,906 2003 2,017,434 185,000 122,550 117,000 239,550 424,550 2,441,984 2004 2,026,663 200,000 117,000 111,000 228,000 428,000 2,454,663 2005 2,028,049 210,000 111,000 104,700 215,700 425,700 2,453,749 2006 2,025,458 225,000 104,700 97,950 202,650 427,650 2,453,108 2007 2,031,930 240,000 97,950 90,750 188,700 428,700 2,460,630 2008 2,031,300 255,000 90,750 83,100 173,850 428,850 2,460,150 2009 2,032,800 270,000 83,100 75,000 158,100 428,100 2,460,900 2010 500,000 75,000 60,000 135,000 635,000 635,000 2011 500,000 60,000 45,000 105,000 605,000 605,000 2012 500,000 45,000 30,000 75,000 575,000 375,000 2013 500,000 30,000 15,000 45,000 545,000 545,000 2014 500,000 15,000 15,000 515,000 515,000 $30,413,204 $5,000,000 $2,038,000 $1,788,000 $3,826,000 $8,826,000 $39,239,204 DATED: 5/01/95 DUE: 3/01/97 - 3/01/14 FIRST COUPON: 3/01/96 PEARC95: NEW95 AGG94TOT 03/02/95 a 16:49 0, CITY OF PEARLAND TOTAL D.S. PLUS SERIES 1995 MAINTAIN $0.26 D.S. TAX RATE FOR FIVE YEARS I & S Assessed Fund I & S Other Valuation Tax Income Total Total Debt Fiscal Beginning Fund Erngs Investments of Prior Tax a 98% Funds Debt Ending Service Year Balance iI 5.00 Tax Year Rate Collection Available Service Balance Coverage 1995 1,200,000 60,000 25,000 786,617,562 0.2600 2,004,302 3,289,302 2,033,151 1,256,150 0.517 1996 1,256,150 62,808 150,000 818,082,265 0.2600 2,084,474 3,553,431 2,428,804 1,124,628 0.459 1997 1,124,628 56,231 50,000 850,805,555 0.2600 2,167,853 3,398,712 2,452,284 946,428 0.384 1998 946,428 47,321 0 884,837,777 0.2600 2,254,567 3,248,316 2,461,471 786,845 0.321 1999 786,845 39,342 0 920,231,288 0.2500 2,254,567 3,080,754 2,453,269 627,485 0.256 2000 627,485 31,374 0 957,040,540 0.2500 2,344,749 3,003,608 2,450,319 553,290 0.226 2001 553,290 27,664 0 995,322,162 0.2500 2,438,539 3,019,493 2,452,816 566,677 0.232 2002 566,677 28,334 0 1,035,135,048 0.2427 2,462,391 3,057,402 2,446,906 610,496 0.250 2003 610,496 30,525 0 1,076,540,450 0.2289 2,414,629 3,055,650 2,441,984 613,666 0.250 2004 613,666 30,683 0 1,119,602,068 0.2209 2,423,751 3,068,100 2,454,662 613,437 0.250 2005 613,437 30,672 0 1,164,386,151 0.2123 2,422,917 3,067,026 2,453,749 613,277 0.250 2006 613,277 30,664 0 1,210,961,597 0.2043 2,424,324 3,068,265 2,453,108 615,157 0.250 2007 615,157 30,758 0 1,259,400,060 0.1969 2,429,752 3,075,667 2,460,630 615,038 0.250 2008 615,038 30,752 0 1,309,776,063 0.1893 2,429,586 3,075,375 2,460,150 615,225 0.250 2009 615,225 30,761 0 1,362,167,105 0.1478 1,973,664 2,619,650 2,460,900 158,750 0.250 2010 158,750 7,938 0 1,416,653,790 0.0446 619,563 786,250 635,000 151,250 0.250 2011 151,250 7,563 0 1,473,319,941 0.0409 589,937 748,750 605,000 143,750 0.250 2012 143,750 7,188 0 1,532,252,739 0.0373 560,313 711,250 575,000 136,250 0.250 2013 136,250 6,813 0 1,593,542,848 0.0340 530,688 673,750 545,000 128,750 0.250 2014 128,750 6,438 0 1,657,284,562 0.0234 379,813 515,000 515,000 0 0.250 $603,827 $225,000 $37,210,376 $39,239,203 Avg Tax Rate .... 0.1850 Prepared by: Rauscher Pierce Refsnes, Inc. PEARC95: TAX95 AGG95TOT 03/02/95 a 16:47 CT) PEARS Cftuj o OO o 00fllc� �J v, 'E 5* 3519 Liberty Drive • Peariand, Texas 77581-5416 X A (713) 485-241 1 • fax (713) 485-8764 AGENDA ITEM To: Mayor and City Council Through: Paul Grohman, City Manager '— From: Richard Burdine, Assistant City Manager /1(2 t Subject : Review of Immediate Capital Improvement Needs Date: March 7 , 1995 The attached table shows costs for the six highest priority projects out of the fourteen street projects presented at the City Council Workshop on the Capital Improvement Program. Of the $3, 172 , 400 total , over 80% is for Projects 1 & 2 , extending Centennial Boulevard from Main Street (SH 35) to Broadway (FM 518) . The City Council has already committed to engineering and right-of- way negotiations for both projects . Project 3 , reconstruction of Shady Bend Drive from Liberty to Misty, addresses long-standing street maintenance problems . The urgency here is two-fold; to stop wasting money on temporary patches and to finish the project before school starts next Fall . Projects 4, 5 and 6 work in conjunction with TxDOT plans to overlay West Broadway from Texas to FM 1128 and restripe it for four travel lanes and a continuous left turn lane . Project 4 would reconstruct the McLean/Walnut intersection to allow a free right turn off eastbound Walnut and full signalization, coordinated with the TxDOT signal at McLean and Broadway . We receive frequent complaints about this intersection. Project 5 would reconstruct the intersection of old and new North Hatfield Roads to warrant full signalization of the new North Hatfield at Broadway intersection, which aligns with South Hatfield . TxDOT has agreed to install a signal based on traffic counts and complaints from residents and business owners in the area. Project 6 would realign Harkey Road with O' Day Road at Broadway to allow full signalization and reduce the frequency and severity of traffic accidents . The Funding Summary shows total resources of $5 , 686, 800 . Deducting immediate funding needs of $3 , 172, 400 , unallocated 1995 Certificates of Obligation of $2 , 514, 400 would remain. The City Council would later allocate these funds for street , drainage and/or building projects as it deems appropriate . 0 Printed on Recycled Paper Street Capital Improvements Program - Immediate Needs 3 Year Priority No.-Project Name 1994-95 1995-96 1996-97 Total 1-Centennial Blvd./Oiler Dr. $961 ,000 $345,000 $1 ,306,000 2-Centennial Blvd. - Lizer to Broadway (FM 518) $896,400 $375,000 $1 ,271 ,400 3-Shadybend Drive $130,000 $130,000 West Broadway Upgrade 4-McLean/Walnut Intersection $65,000 $135,000 $200,000 5-Hatfield/Hatfield Intersection $22,500 $22,500 $45,000 6-Harkey/O'Day Intersection $120,000 $100,000 $220,000 Estimated Expenditure by Year $2,194,900 $977,500 $0 $3,172,400 Funding Summary - Immediate Needs Resource Type Proceeds from 1995 Certificates $5,000,000 Centennial Blvd. Eng. Paid-to-Date $228,800 Remaining 1992 Street Bonds $458,000 Total Resources $5,686,800 Minus Immediate Funding Needs ($3,172,400) Unallocated 1995 Certificates _ $2,514,400 Cfluj aon©rllano v *�\ * 3519 liberty Drive • Pearland, Texas 77581-5416 11 • Fax 7 4 5 7 4 (713) 485 Q4 a ( 13) 8 8 6 AGENDA ITEM To: Mayor and City Council Through: Paul Grohman, City Manager From: Richard Burdine, Assistant City Manager R/6---' Subject : Review of Immediate Capital Improvement Needs Date: March 7 , 1995 The attached table shows costs for the six highest priority projects out of the fourteen street projects presented at the City Council Workshop on the Capital Improvement Program. Of the $3 , 172 , 400 total , over 80% is for Projects 1 & 2 , extending Centennial Boulevard from Main Street (SH 35) to Broadway (FM 518) . The City Council has already committed to engineering and right-of- way negotiations for both projects . Project 3 , reconstruction of Shady Bend Drive from Liberty to Misty, addresses long-standing street maintenance problems . The urgency here is two-fold; to stop wasting money on temporary patches and to finish the project before school starts next Fall . Projects 4, 5 and 6 work in conjunction with TxDOT plans to overlay West Broadway from Texas to FM 1128 and restripe it for four travel lanes and a continuous left turn lane . Project 4 would reconstruct the McLean/Walnut intersection to allow a free right turn off eastbound Walnut and full signalization, coordinated with the TxDOT signal at McLean and Broadway . We receive frequent complaints about this intersection. Project 5 would reconstruct the intersection of old and new North Hatfield Roads to warrant full signalization of the new North Hatfield at Broadway intersection, which aligns with South Hatfield . TxDOT has agreed to install a signal based on traffic counts and complaints from residents and business owners in the area . Project 6 would realign Harkey Road with O'Day Road at Broadway to allow full signalization and reduce the frequency and severity of traffic accidents . The Funding Summary shows total resources of $5 , 686, 800 . Deducting immediate funding needs of $3 , 172, 400 , unallocated 1995 Certificates of Obligation of $2 , 514, 400 would remain. The City Council would later allocate these funds for street , drainage and/or building projects as it deems appropriate . 0 Printed on Recycled Paper Street Capital Improvements Program - Immediate Needs 3 Year Priority No.-Project Name 1994-95 1995-96 1996-97 Total 1-Centennial Blvd./Oiler Dr. $961 ,000 $345,000 $1 ,306,000 2-Centennial Blvd. - Lizer to Broadway (FM 518) $896,400 $375,000 $1 ,271 ,400 3-Shadybend Drive $130,000 $130,000 West Broadway Upgrade 4-McLean/Walnut Intersection $65,000 $135,000 $200,000 5-Hatfield/Hatfield Intersection $22,500 $22,500 $45,000 6-Harkey/O'Day Intersection $120,000 $100,000 $220,000 Estimated Expenditure by Year $2,194,900 $977,500 $0 $3,172,400 Funding Summary - Immediate Needs Resource Type Proceeds from 1995 Certificates $5,000,000 Centennial Blvd. Eng. Paid-to-Date $228,800 Remaining 1992 Street Bonds $458,000 Total Resources $5,686,800 1 Minus Immediate Funding Needs ($3,172,400) Unallocated 1995 Certificates $2,514,400 .„-co : ale de,t1_,(.4_,Le • STANDARD .& POOR'S 1 1 MUNICIPAL THE AUTHORITY ON CREDIT QUALITY MARCH 6, 1995 CLEARING ROADBLOCKS TO PUBLIC-PRIVATE PARTNERSHIPS When Congress passed the ment,and allow govern- In a partnership,the pri- Intermodal Surface Trans- ments to quickly address vate sector ideally benefits • `` portation Efficiency Act regulatory matters.They from the potential for profits (ISTEA)in 1991,lawmakers have been slow,however,to while the public sector gains hailed it as a win-win solu- embrace that role.To date, access to the toll road sooner tion for cash-strapped gov- only Minnesota and Wash- and in a more cost-effective ernments needing to finance ington have passed such leg- manner than traditional gov- billions of dollars of infra- islation. ernmental financing.But structure projects and pri- ISTEA was designed to reaching that point has been vate companies wishing to provide a link between part- difficult for supporters of gr7.3a7rxrp s T, gain access to the artner nershi sand toll roads,for public-private partnerships D� : if ' ', ' ship business.Soar,how- the first time allowing the in many states. Iti ° t j ' ever,political and financial commingling of federal and The most significant hur- dl.1 ii es roadblocks have stunted the private sector funds on toll dles facing partnerships are growth of ISTEA public pri- facilities.Additionally, financial.Funding by pri LIAR 1995 vate partnerships. ISTEA expanded state and vate companies,whose 0 State legislators can play local eligibility for federal bonds are taxable,are at a disared CITY of PEARLAND an important role in clearing funds for new toll-road con- with tax-exempt ptco bondin „�,, with tax-exempt bonding by CITY 2ECRETARY'S OFFICE those obstacles by passing struction,reconstruction of public entities.Moreover, laws that facilitate the forma- existing systems,and conver- tion of partnerships,acceler- sion of free highways to toll ate procurement of equip- roads. Continued on page 18 HIGHLIGHTS 65 WISC. PROPERTY TAX RELIEF COULD LEAD TO HIGHER STATE TAXES � �NS Wisconsin lawmakers are debating a proposed budget that includes major property tax relief, but will voters be willing to absorb the increased state taxes such relief could require? --- 66 STATE COMMITTED TO CAL-MORTGAGE;PROBLEMS REMAIN toREo Recent events involving the California Mortgage Loan Guarantee Program have s.0c re' demonstrated the state's commitment to the program while underscoring the problems inherent its speculative portfolio. 67 FINANCING AFFORDABLE HOUSING IN CALIFORNIA Affordable housing is an ongoing need,particularly in the high-cost state of California.The state has used housing set-aside funds generated by redevelopment project areas to help meet this need. 68 STATUTE CHANGES DID NOT AFFECT OREGON NOTE RATINGS GE os*t s Legislative changes that weakened Oregon's short-term borrowing statute have not affected 0`'�P fi _ note ratings and are unlikely to lead to a deterioration in credit quality. (SEE PAGE 3 FOR A COMPLETE LIST OF ISSUE CONTENTS.) ` UPDATES CONTINUED As a result, NWCC's unrestricted monies total OUTLOOK:STABLE S&P anticipates that break- ((f 3.6%of overall budget and,when combined with even financial operations will continue,property the debt service reserve fund,12.9%of debt.Debt tax collections will remain constant,and that debt totals$11.2 million($7.1 million G.O.bonds,$4.1 levels will not increase.In addition,slow enroll- million revenue bonds). Maximum annual debt ment growth is expected to continue. { service is high at$1.6 million,or 14%of budget; however, debt amoritization is rapid, with the 1 series 1992 due in 2002. OHIO WATER DEVELOPMENT AUTHORITY S&P Contacts:Seth Lehman(212)208-1356,David Woodrow(212)208-1789 1 RATING AFFIRMED Ohio Water Development Authority (OWDA) identity of such communities to receive loans are $114.4 mil.wtr dev rev has modified some legal provisions in the pro- not yet known.The program's structure,under a beds.1995 Fresh Water A gram's trust indenture since S&P initially as- new indenture, incorporates adequate security signed its 'A' rating to OWDA's fresh water provisions by pledging surplus funds available OUTLOOK: STABLE 3 bonds on Feb. 13, 1995. The most important from three prior OWDA pool programs—Pure 1 LONG TERM change establishes an additional dedicated re- Water,Safe Water,and Clean Water—in addition lir 1 serve through a restricted account within the to loan repayments from existing fresh water �� � cross-collateralization fund, equal to 50% of borrowers. Prior to releasing accumulated sur- ���j� maximum annual debt service (MADS). How- pluses for any lawful purpose, a minimum re- Pi" ever,despite the new program feature,a higher serve equal to 50%MADS must be maintained for rating is precluded because of the average credit the Fresh Water program. Security also is pro- ` "r+' pro- profile of existing borrowers with fairly high con- vided by a separate reserve fund equal to one-half { centration levels and a weak additional bonds MADS.However,uncertainty remains about the ytest of 1.05 times(x)coverage.Over the long term, program's future coverage requirements and reduced concentration of the program's largest borrower concentration levels, given the pool's 1 1 borrowers,through additional loans,could lead open nature structure and management's ability to a higher rating. to issue parity obligations by meeting only a 1.05x Credit strengths for the fresh water program coverage test. are provided by underlying cash flows. These The six-largest borrowers account for about (4) underlying cash flows comprise loan repayments 65% of total loan repayments. The largest bor- from local governmental agencies and surpluses rower, Southwest Licking Water & Sewer Dis- from previous OWDA pool programs to meet'A' trict, Ohio (unrated), accounts for 25% of loans category cash flow sufficiency under S&P's de- outstanding and is expected to remain the pro- fault tolerance criteria for large pool financings. gram's dominant borrower.OWDA has an excel- Also factored in the rating is OWDA's historical lent track record of ensuring timely loan repay- financial management of pool programs. ment for all of its programs over the past 26 years. The fresh water program was established in 1992 and already has 48 participating communi- OUTLOOK:STABLE The outlook reflects suffi- ties,with about$120 million of originated loans. ciency of cash flow tests for based on existing and Bond proceeds will be used to finance various future financings under this indenture,given the water and sewer system projects; however, the weak additional bonds test. PEARLAND, TEXAS S&P Contacts:Amy Mullen Luster(212)208-8687,Alex Fraser(212)208-1747 UPGRADED The upgrade on Pearland,Texas'bonds reflects Mart,with only one oilfield equipment company TO FROM the city's strong tax base growth and diversifica- remaining in the top-10 taxpayers.Over the past $100,000 unenhanced tion within the local economy,as well as slightly five years,the city's assessed value has grown by G.0.debt A A- lower,although still high,debt levels.Other un- $210 million(an average annual rate of 6.5%)to RATING AFFIRMED derlying credit characteristics include the city's $786 million in fiscal 1995,which reflects the local $18.9E mil.ins.G.0 access to Houston metro litan statistical area economy's recoveryand expansion. OUTLOOK: STABLE. debt AAA and stable financial position with strong reserve The city's finanal operations are sound. De- levels. spite rapid budget growth because of population LONG TERM Located about 15 miles southeast of downtown growth,the city has been able to lower its tax rate Houston, Pearland's population has grown by and maintain strong reserves.As the tax base has almost 8,000(44%)to 27,000 from 1990-1995.Al- grown,the city has lowered its 1995 tax rate by R��ONS though still predominantly residential,Pearland almost 15%to 6.974 mills from 8.25 mills in 1990. Ge. Gp,(1 • has an established employment base of small oil Since fiscal 1988,annual operating expenses have O :� 41 equipment manufacturing companies, which is increased by$4.4 million to about$9 million at `. expanding to new manufacturing and more year-end Sept.30,1994(unaudited).In 1994,un- t4 rade-related employment. Among the leading designated general fund balance was $2.1 mil- taxpayers is a new airplane parts manufacturer lion,or 24%of annual operating expenses,versus (Aerospace International)and an expanded Wal- $247,000, or 4.9% of expenses, in 1988. During / STANDARD & POOR'S CREDITWEEK MUNICIPAL MARCH 6, 1995 61 - -1 SECONDARY MARKET fiscals 1993-1994,the city did draw down its fund Sept.30,1994 but far lower than the high of 41% balance from its high in 1992 of 45% of annual in 1989. The city's debt service reserve of $1.2 operating expenses,or$3.1 million,to the current million at Sept.30,1994 provides further liquid 111 - level.These drawdowns were for previous budg- ity.The city plans to issue about$5 million of G.O. eted capital projects not completed as planned in bonds in late spring or early summer. prior years and for an accounting change in ex- pense recognition. The city manager plans to OUTLOOK:STABLE The outlook reflects the ex- keep reserves around the 1994 reserve of 24%. pectation that the city will maintain strong finan- As expected with a growing city,debt levels are cial operations and continue to experience diver- 4 high.Overall net debt per capita is$1,961 and 6% sification in the local economy with an ongoing of true value. The city has reduced carrying high debt level. charges to a still high 20%of annual expenses at STARTEX-JACKSON-WELLFORD-DUNCAN WATER DISTRICT, SOUTH CAR O LI NA S&P Contact Jeffrey Panger(212)208-8935 RATING AFFIRMED The rating on Startex-Jackson-Wellford-Duncan ers.The district's customer base has continued its $2.1 mil.G.O.bnds.ser. Water District,S.C.'s bonds reflects good tax-base trend of expansion,increasing 7%in fiscal 1994. 1988 A- growth,solid tax collection rates,adequate finan- Financial operations remain solid.The district OUTLOOK:STABLE cial position,and low debt levels, offset by the has posted operating surpluses in each of the last LONG TERM single-purpose nature of the district. three years.Water sales constitute 76%of district The district levies property taxes for debt serv- revenues, while property taxes account for the ice costs associated with these bonds.The district bulk of the remaining revenue base.The district has experienced strong property value growth, had$175,000 in unrestricted cash at fiscal year- _NS with nearly 10%average annual increases in as- end 1994,equivalent to 5.6%of operating expen- sessed values over the past five years. This ditures.Carrying charges account for a manage- growth enabled the district to cut the tax rate in able 6% of operating expenses, while the debt 1993 to 10 mills from 11.6 mills.Current tax col- burden is low at$264 per capita and 0.6%of true lections have continued at their traditionally high value. 95%level. The district, located in the rapidly growing OUTLOOK:STABLE The outlook is based on the Spartanburg, S.C. metropolitan statistical area district's participation in the Spartanburg MSA (MSA),provides water service to 11,600 custom- and the anticipation that tax-base growth will continue. TULSA JUNIOR COLLEGE, OKLAHOMA S&P Contact Kara Glover(212)208-1264 RATINGS AFFIRMED The rating on Tulsa Junior College Okla.'s(TJC) (often the University of Oklahoma or Oklahoma $1.435 mil.stud.ctr.rev. bonds is based on good and improving debt serv- State University) to complete their undergradu- bnds.ser.1976 and ice coverage provided by the revenues of the ate education.The other 50%are enrolled in tech- 1978 A student center system. Additional ratingfactors nical occupational programs. The college has a $2.235 mil.stud.ctr.rev. Y P P gr g bnds.ser.1994 include strong community support and utiliza- state required open admissions policy. Admis- (MBIA-ins.) AM tion of the institution and the consistent genera- sion is granted with a high school diploma or a $2.5 mil.stud.ctr.rev. tion of operating surpluses.These factors are off- G.E.D. equivalent. TJC is the only community bnds.ser.1994 (MBIA-ins.) AAA set by TJC's open admissions policy by virtue of college in the county and receives much support OUTLOOK:STABLE its community college status,giving it no admis- from the community in local tax revenues as well sions flexibility. as through close relationships with business and LONG TERM TJC is a two-year comprehensive community civic groups in the surrounding area. college. It is the largest and only multicampus The bonds are secured by net revenues of the ,. junior college in Oklahoma.Almost all students student center system, including the bookstore, come from within the state,with 82%living in or dining facility, surface parking, and the gross just around Tulsa County.Approximately 64%of receipts of the student activity and student center students in Tulsa County begin their education at fees.System revenues continue to grow allowing TJC.The college presently has three campuses in net available to increase to$1.47 million in fiscal operation and is constructing its fourth campus 1994 from$1.27 million the previous year.These scheduled to open in the fall of 1995.The addition surpluses provided maximum annual debt serv- of the West Campus is a result of many years of ice(MADS)coverage of 1.64 times(x)and 1.41x enrollment growth.Total headcount enrollment in fiscal 1994 and 1993,respectively.MADS will for 1994 was 30,359, translating into 9,766 full- occur in 1995.Therefore,if net available contin- time equivalents (FTEs)—a 12.0% increase in ues at the present level, coverage would only headcount but a 30.3%increased in FTEs over the improve. The college presently has no plans to past six year period. Approximately 50%of stu- issue additional bonds off this revenue stream. dents are enrolled in university parallel programs The overall financial performance of the college and plan to transfer to a four-year institution remains strong.Operating surpluses average$3.1 Ma.aramexamliSelliatwo 2 STANDARD & POOR'S CREDITWEEK MUNICIPAL MARCH 6, 1993