Ord. 1484 2013-06-24 ORDINANCE NO. 1484
ORDINANCE 1484
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF PEARLAND,
TEXAS, PERMANENT IMPROVEMENT AND/OR REFUNDING BONDS IN
ONE OR MORE SERIES; SETTING CERTAIN PARAMETERS FOR THE
BONDS; AUTHORIZING REFUNDING OF CERTAIN OUTSTANDING
OBLIGATIONS; AUTHORIZING A PRICING OFFICER TO APPROVE THE
AMOUNT, THE INTEREST RATE, PRICE, AND TERMS THEREOF AND
CERTAIN OTHER PROCEDURES AND PROVISIONS RELATING THERETO
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
WHEREAS, the City of Pearland, Texas (the "City"), acting through its City Council, is
authorized by Section 3.07 of its Home Rule Charter and the Constitution and laws of the State of
Texas, particularly Chapters 1331 of the Texas Government Code, as amended, to issue bonds for
the purpose of making needed public improvements;
WHEREAS,the issuance of certain bonds herein authorized was approved by the voters of
the City at an election held for such purpose on May 12,2007(the"Election"),which was called by
the City Council pursuant to Resolution No.R2007-35 adopted March 5,2007,and which authorized
the issuance of: (i) $84,190,000 in bonds for purchasing and otherwise acquiring land for and
constructing,repairing and improving streets,bridges and sidewalks of the City with first priority to
be given to the construction,repair and improvement of Bailey Road,Cullen Boulevard,Dixie Farm
Road and McHard Road ("Proposition 1"); (ii) $35,305,000 in bonds for purchasing, acquiring,
enlarging, extending, equipping and constructing drainage improvements and facilities at various
locations within the City, including acquiring lands and rights-of-way for any of such purposes
("Proposition 2"); (iii) $2,895,000 in bonds for purchasing, acquiring, constructing, repairing and
improving land, facilities and equipment for public safety purposes (including fire fighting
needs)("Proposition 3");(iv)$19,990,000 in bonds for purchasing,acquiring,constructing,repairing
and improving land,facilities and equipment for park and recreation purposes("Proposition 4");(v)
$16,225,000 in bonds for purchasing,acquiring,constructing,repairing and improving land,facilities
and equipment for park and recreation purposes,with first priority to be given to the construction of
recreation center and the construction of a natatorium ("Proposition 5"); and (vi) $3,410,000 in
bonds for purchasing and otherwise acquiring land for and constructing, repairing and improving
library facilities ("Proposition 6");
WHEREAS, the City Council canvassed the returns of the Election and by Ordinance No.
R2007-86, adopted May 22, 2007 declared the results to be in favor of the issuance of the Bonds;
WHEREAS, the City has previously authorized, issued and delivered four installments of
such authorized bonds from the Election in an aggregate principal amount of$57,545,000,consisting
of(i)$23,560,000 of principal attributable to bonds authorized by Proposition 1;(ii)$15,486,500 of
principal attributable to bonds authorized by Proposition 2;(iii)$2,895,000 of principal attributable
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to bonds authorized by Proposition 3;and(iv)$393,000 of principal attributable to bonds authorized
by Proposition 4;(v)$15,210,500 of principal attributable to Proposition 5;and(vi)$0 of principal
attributable to Proposition 6;
WHEREAS, the City has now determined that it is necessary and advisable to authorize,
issue and deliver a fifth installment of such authorized bonds from the Election in an aggregate
principal amount not to exceed $10,000,000 for the purposes of funding the permanent
improvements described herein;
WHEREAS,the City Council is of the opinion and hereby affirmatively finds that it is in the
best interest of the City to issue such fifth installment of bonds from the Election in the amounts and
for the purposes herein stated.
WHEREAS, the City Council of the City has heretofore issued or assumed the obligations
described in Exhibit A attached hereto and as more particularly described in the Officer's Pricing
Certificate (defined herein); and
WHEREAS,the City desires to refund part of said obligations in advance of their maturities
as determined pursuant to the parameters set forth herein(the"Refunded Bonds"); and
WHEREAS, Chapter 1207, Texas Government Code, as amended ("Chapter 1207")
authorizes the City to issue refunding bonds payable from taxes,without an election,for the purpose
of refunding the Refunded Bonds in advance of their maturities,and to accomplish such refunding by
depositing directly with any paying agent for the Refunded Bonds(or other qualified escrow agent),
the proceeds of such refunding bonds,together with other available funds,in an amount sufficient to
provide for the payment or redemption of the Refunded Bonds,and provides that such deposit shall
constitute the making of firm banking and financial arrangements for the discharge and final payment
or redemption of the Refunded Bonds; and
WHEREAS,the City desires to authorize the execution of an escrow agreement,if necessary,
and provide for the deposit of proceeds of the refunding bonds,together with other lawfully available
funds of the District, to pay the Refunded Bonds; and
WHEREAS,upon the issuance of the refunding bonds herein authorized and the deposit of
funds referred to above, the Refunded Bonds shall no longer be regarded as being outstanding,
except for the purpose of being paid pursuant to such deposit, and the pledges, liens, trusts and all
other covenants,provisions, terms and conditions of the ordinances authorizing the issuance of the
Refunded Bonds shall be,with respect to the Refunded Bonds,discharged,terminated and defeased;
WHEREAS,the City is a home-rule municipality that(i)adopted its charter under Section 5,
Article XI, Texas Constitution; (ii) has a population of 50,000 or more; and (iii) has outstanding
long-term indebtedness that is rated by a nationally recognized rating agency for municipal securities
in one of the four highest rating categories for a long-term obligation and thus the City qualifies as
an"Issuer"under Chapter 1371, Texas Government Code("Chapter 1371"); and
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WHEREAS, Chapter 1207 and Chapter 1371 authorize the City to delegate the authority to
effect the sale of the Bonds to a Pricing Officer, as defined herein. Now, therefore
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PEARLAND:
1. Recitals;Consideration. It is hereby found and determined that the matters and facts
set out in the preamble to this Ordinance are true and correct.
It is hereby found and determined that the refunding contemplated in this Ordinance will
benefit the City by providing a present value savings in the debt service payable by the City, that
such benefit is sufficient consideration for the refunding of the Refunded Bonds, and that the
issuance of the refunding bonds is in the best interests of the City.
2. Definitions. Throughout this Ordinance the following terms and expressions as used
herein shall have the meanings set forth below:
"Blanket Issuer Letter of Representations"means the Blanket Issuer Letter of Representations
between the City, the Registrar and DTC.
"Bond Purchase Agreement" means an agreement between the City and the Underwriter
described in Section 23 of this Ordinance.
"Bonds"means the means one or more series of Bonds issued by the City of Pearland,Texas
authorized in this Ordinance, as designated in an Officer's Pricing Certificate.
"Business Day" means any day which is not a Saturday, Sunday, or a day on which the
Registrar is authorized by law or executive order to close, or a legal holiday.
"City"means the City of Pearland, Texas.
"Closing Date"means the date of the initial delivery of and payment any series of Bonds.
"Code"means the Internal Revenue Code of 1986, as amended.
"Comptroller"means the Comptroller of Public Accounts of the State of Texas.
"Debt Service Fund"means the debt service fund for payment of the Bonds established by
the City in Section 20 of this Ordinance.
"DTC" means The Depository Trust Company of New York, New York, or any successor
securities depository.
"DTC Participant"means brokers and dealers,banks,trust companies,clearing corporations
and certain other organizations on whose behalf DTC was created to hold securities to facilitate the
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clearance and settlement of securities transactions among DTC Participants.
"Escrow Agent"means Wells Fargo Bank, N.A.
"Escrow Agreement"means an agreement between the City and the Escrow Agent relating to
the escrow of funds to pay the Refunded Bonds.
"Initial Bond"means the Initial Bond authorized by Section 6(d).
"Interest Payment Date", when used in connection with any Current Interest Bond, means
shall mean the date(s) determined by a Pricing Officer and set forth in the Officer's Pricing
Certificate.
"MSRB"means the Municipal Securities Rulemaking Board.
"Officer's Pricing Certificate"means a certificate signed by the Pricing Officer pursuant to
Section 5 hereof.
"Ordinance" as used herein and in the Bonds means this ordinance authorizing the Bonds.
"Owner"means any person who shall be the registered owner of any outstanding Bond.
"Pricing Officer"means the Mayor, City Manager or the Director of Finance.
"Record Date"means, with respect to the Bonds,the close of business on the last Business
Day of the month preceding such Interest Payment Date.
"Refunded Bonds"means any of the obligations described on Exhibit A attached hereto and
as more specifically described in the Officer's Pricing Certificate.
"Register"means the books of registration kept by the Registrar,in which are maintained the
names and addresses of, and the principal amounts of the Bonds registered to, each Owner.
"Registrar"means Wells Fargo Bank,N.A., and its successors in that capacity.
"Report" means the report of Grant Thornton LLP, verifying the accuracy of certain
mathematical computations relating to the Bonds and the Refunded Bonds.
"Rule"means SEC Rule 15c2-12, as amended from time to time.
"SEC"means the United States Securities and Exchange Commission.
"Underwriters"means the firms listed in the Officer's Pricing Certificate as the underwriters
or initial purchasers of the Bonds.
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3. Authorization. The Bonds shall be issued in fully registered form in a maximum
principal amount, including any premium counted against voted authorization, (i) not to exceed
$10,000,00 for the public improvements as follows: (a) $4,000,000 for purchasing and otherwise
acquiring land for and constructing, repairing and improving streets, bridges and sidewalks of the
City, (b) $2,000,000 in bonds for purchasing, acquiring, enlarging, extending, equipping and
constructing drainage improvements and facilities at various locations within the City, including
acquiring lands and rights-of-way for any of such purposes,(c)$4,000,000 for purchasing,acquiring,
constructing, repairing and improving land, facilities and equipment for park and recreation
purposes, and (d) the costs of issuing the Bonds, and/or (ii) if certain savings thresholds are
achieved,in an amount not to exceed$30,000,000 for the purpose of refunding the Refunded Bonds,
under and in strict conformity with the Constitution and laws of the State of Texas, particularly
Chapters 1207, Texas Government Code and the costs of issuing the Bonds. The Bonds may be
issued in one or more series/installments.
4. Date,Denomination,Interest Rates,and Maturities. The Bonds shall be designated as
City of Pearland,Texas Permanent Improvement 1 and shall be dated the date set forth
in the Officer's Pricing Certificate, shall mature on March 1 in each of the years and in the amounts
set out in the Officer's Pricing Certificate, shall be subject to prior optional and mandatory
redemption on the dates,for the redemption prices and in the amounts set out in the Officer's Pricing
Certificate and shall bear interest from their issuance date at the rates set forth in the Officer's
Pricing Certificate payable on each March 1 and September 1 commencing on the date set forth in
the Officer's Pricing Certificate. The Bonds may be transferred and exchanged as set out in this
Ordinance. The Initial Bond shall be numbered I-1 and all other Bonds shall be numbered in
sequence beginning with R-1. Bonds delivered on transfer of or in exchange for other Bonds shall be
numbered in order of their authentication by the Registrar,shall be in the denomination of$5,000 or
integral multiples thereof,and shall mature on the same date and bear interest on the same rate as the
Bond or Bonds in lieu of which they are delivered.
5. Selling and Delivering the Bonds. As authorized by Sections 1207 and 1371,Texas
Government Code, as amended,the Pricing Officer is hereby authorized to act on behalf of the City
in selling and delivering the Bonds,in one or more series of bonds/installments,and carrying out the
other procedures specified in this Ordinance, including without limitation determining the price at
which the Bonds will be sold,the issuance date for the Bonds,the form in which the Bonds shall be
issued (whether as current interest bonds or as any combination of current interest bonds and
compound interest bonds),the years in which the Bonds will mature,the principal amount to mature
in each of such years, the rate of interest to be borne by each such maturity, the dates, prices and
terms upon and at which the Bonds shall be subject to redemption prior to maturity at the option of
the City, as well as any mandatory redemption provisions for the Bonds, and all other matters not
expressly provided in this Ordinance,relating to the issuance,sale and delivery of the Bonds,and the
refunding of the Refunded Bonds,all of which shall be specified in the Officer's Pricing Certificate;
provided that:
(i) none of the Bonds shall bear interest at a rate in excess of the maximum rate
1 Insert from Pricing Certificate.
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allowed by Chapter 1204, Texas Government Code, as amended;
(ii) the aggregate principal amounts of the Bonds may not exceed the maximum
principal amounts authorized in Section 3 hereof, and the proceeds from the
sale of the Bonds,along with any available funds of the City to be used in the
refunding,must be sufficient to provide, after all original issue discount and
underwriter's discount, amounts necessary to fund the costs and expenses of
refunding the Refunded Bonds and the estimated costs of issuance of the
Bonds; and
(iii) the net present value savings in debt service resulting from the refunding of
the Refunded Bonds shall be at least 3% of the principal amount of the
Refunded Bonds, as shown by a table of calculations prepared by the City's
financial advisor and attached to the Officer's Pricing Certificate.
6. Execution of Bonds; Seal. (a) The Bonds shall be signed on behalf of the City by the
Mayor and countersigned by the City Secretary, by their manual, lithographed, or facsimile
signatures, and the official seal of the City shall be impressed or placed in facsimile thereon. Such
facsimile signatures on the Bonds shall have the same effect as if each of the Bonds had been signed
manually and in person by each of said Officer's,and such facsimile seal on the Bonds shall have the
same effect as if the official seal of the City had been manually impressed upon each of the Bonds.
(b) If any officer of the City whose manual or facsimile signature shall appear on the
Bonds shall cease to be such officer before the authentication of such Bonds or before the delivery of
such Bonds, such manual or facsimile signature shall nevertheless be valid and sufficient for all
purposes as if such officer had remained in such office.
(c) Except as provided below,no Bond shall be valid or obligatory for any purpose or be
entitled to any security or benefit of this Ordinance unless and until there appears thereon the
Registrar's Authentication Bond substantially in the form provided herein, duly authenticated by
manual execution by an officer or duly authorized signatory of the Registrar. In lieu of the executed
Registrar's Authentication Bond described above,the Initial Bond delivered at the Closing Date shall
have attached hereto the Comptroller's Registration Certificate substantially in the form provided
herein,manually executed by the Comptroller,or by his duly authorized agent,which certificate shall
be evidence that the Initial Bond has been duly approved by the Attorney General of the State of
Texas and that it is a valid and binding obligation of the City, and has been registered by the
Comptroller.
(d) On the Closing Date, the Initial Bond, being a single bond representing the entire
principal amount of the Bonds, payable in stated installments to the Underwriter or its designee,
executed by manual or facsimile signature of the Mayor and City Secretary of the City,approved by
the Attorney General, and registered and manually signed by the Comptroller, shall be delivered to
the Underwriter or its designee. Upon payment for the Initial Bond, the Registrar shall cancel the
Initial Bond and deliver definitive Bonds to DTC.
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7. Payment of Principal and Interest. The Registrar is hereby appointed as the paying
agent and registrar for the Bonds. The principal of the Bonds shall be payable,without exchange or
collection charges, in any coin or currency of the United States of America which, on the date of
payment, is legal tender for the payment of debts due the United States of America, upon their
presentation and surrender as they respectively become due and payable at the principal payment
office of the Registrar in Dallas,Texas. The interest on each Bond shall be payable on each Interest
Payment Date,by check mailed by the Registrar on or before the Interest Payment Date to the Owner
of record as of the Record Date.
If the date for payment of the principal of or interest on any Bond is not a Business Day,then
the date for such payment shall be the next succeeding Business Day with the same force and effect
as if made on the date payment was originally due.
8. Successor Registrars. The City covenants that at all times while any Bonds are
outstanding it will provide a commercial bank or trust company, organized under the laws of the
United States or any state, and duly qualified and legally authorized to serve as Registrar for the
Bonds. The City reserves the right to change the Registrar on not less than 60 days written notice to
the Registrar, so long as any such notice is effective not less than 60 days prior to the next
succeeding principal or interest payment date on the Bonds. Promptly upon the appointment of any
successor Registrar, the previous Registrar shall deliver the Register or copies thereof to the new
Registrar, and the new Registrar shall notify each Owner,by United States mail, first class postage
prepaid,of such change and of the address of the new Registrar. Each Registrar hereunder,by acting
in that capacity, shall be deemed to have agreed to the provisions of this Section.
9. Special Record Date. If interest on any Bond is not paid on any Interest Payment Date
and continues unpaid for thirty(30) days thereafter, the Registrar shall establish a new record date
for the payment of such interest,to be known as a Special Record Date. The Registrar shall establish
a Special Record Date when funds to make such interest payment are received from or on behalf of
the City. Such Special Record Date shall be fifteen(15)days prior to the date fixed for payment of
such past due interest,and notice of the date of payment and the Special Record Date shall be sent by
United States mail,first class,postage prepaid,not later than five(5)days prior to the Special Record
Date,to each affected Owner of record as of the close of business on the day prior to the mailing of
such notice.
10. Ownership;Unclaimed Principal and Interest. The City,the Registrar and any other
person may treat the person in whose name any Bond is registered as the absolute owner of such
Bond for the purpose of making and receiving payment of the principal of or interest on such Bond,
and for all other purposes, whether or not such Bond is overdue, and neither the City nor the
Registrar shall be bound by any notice or knowledge to the contrary. All payments made to the
person deemed to be the Owner of any Bond in accordance with this Section shall be valid and
effectual and shall discharge the liability of the City and the Registrar upon such Bond to the extent
of the sums paid.
Amounts held by the Registrar which represent principal of and interest on the Bonds
remaining unclaimed by the Owner after the expiration of three years from the date such amounts
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have become due and payable shall be reported and disposed of by the Registrar in accordance with
the applicable provisions of Texas law including, to the extent applicable, Title 6 of the Texas
Property Code, as amended.
11. Registration,Transfer,and Exchange. So long as any Bonds remain outstanding,the
Registrar shall keep the Register at its principal payment office in Dallas,Texas,and,subject to such
reasonable regulations as it may prescribe,the Registrar shall provide for the registration and transfer
of Bonds in accordance with the terms of this Ordinance.
Each Bond shall be transferable only upon the presentation and surrender thereof at the
principal payment office of the Registrar in Dallas, Texas, duly endorsed for transfer, or
accompanied by an assignment duly executed by the registered Owner or his authorized
representative in form satisfactory to the Registrar. Upon due presentation of any Bond for transfer,
the Registrar shall authenticate and deliver in exchange therefor, within three Business Days after
such presentation, a new Bond or Bonds registered in the name of the transferee or transferees, in
authorized denominations and of the same maturity and aggregate principal amount and bearing
interest at the same rate as the Bond or Bonds so presented.
All Bonds shall be exchangeable upon presentation and surrender thereof at the principal
payment office of the Registrar in Dallas, Texas, for a Bond or Bonds of like maturity and interest
rate and in any authorized denomination, in an aggregate amount equal to the unpaid principal
amount of the Bond or Bonds presented for exchange. The Registrar shall be and is hereby
authorized to authenticate and deliver exchange Bonds in accordance with the provisions of this
Section. Each Bond delivered in accordance with this Section shall be entitled to the benefits and
security of this Ordinance to the same extent as the Bond or Bonds in lieu of which such Bond is
delivered.
The City or the Registrar may require the Owner of any Bond to pay a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with the transfer or
exchange of such Bond. Any fee or charge of the Registrar for such transfer or exchange shall be
paid by the City.
12. Mutilated, Lost, or Stolen Bonds. Upon the presentation and surrender to the
Registrar of a mutilated Bond, the Registrar shall authenticate and deliver in exchange therefor a
replacement Bond of like maturity, interest rate, and principal amount, bearing a number not
contemporaneously outstanding. If any Bond is lost,apparently destroyed,or wrongfully taken,the
City,pursuant to the applicable laws of the State of Texas and in the absence of notice or knowledge
that such Bond has been acquired by a bona fide purchaser, shall authorize and the Registrar shall
authenticate and deliver a replacement Bond of like maturity, interest rate and principal amount,
bearing a number not contemporaneously outstanding.
The City or the Registrar may require the Owner of a mutilated Bond to pay a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection therewith and any
other expenses connected therewith, including the fees and expenses of the Registrar. The City or
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the Registrar may require the Owner of a lost,apparently destroyed or wrongfully taken Bond,before
any replacement Bond is issued, to:
(1) furnish to the City and the Registrar satisfactory evidence of the ownership of
and the circumstances of the loss, destruction or theft of such Bond;
(2) furnish such security or indemnity as may be required by the Registrar and
the City to save them harmless;
(3) pay all expenses and charges in connection therewith, including, but not
limited to,printing costs,legal fees,fees of the Registrar and any tax or other
governmental charge that may be imposed; and
(4) meet any other reasonable requirements of the City and the Registrar.
If,after the delivery of such replacement Bond,a bona fide purchaser of the original Bond in lieu of
which such replacement Bond was issued presents for payment such original Bond,the City and the
Registrar shall be entitled to recover such replacement Bond from the person to whom it was
delivered or any person taking therefrom, except a bona fide purchaser, and shall be entitled to
recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or
expense incurred by the City or the Registrar in connection therewith.
If any such mutilated,lost, apparently destroyed or wrongfully taken Bond has become or is
about to become due and payable, the City in its discretion may, instead of issuing a replacement
Bond, authorize the Registrar to pay such Bond.
Each replacement Bond delivered in accordance with this Section shall be entitled to the
benefits and security of this Ordinance to the same extent as the Bond or Bonds in lieu of which such
replacement Bond is delivered.
13. Cancellation of Bonds. All Bonds paid in accordance with this Ordinance, and all
Bonds in lieu of which exchange Bonds or replacement Bonds are authenticated and delivered in
accordance herewith, shall be canceled and destroyed upon the making of proper records regarding
such payment. The Registrar shall furnish the City with appropriate certificates of destruction of
such Bonds.
14. Book-Entry Only System. (a) The Initial Bond shall be registered in the name of the
Underwriters. Except as provided in Section 15 hereof, all other Bonds shall be registered in the
name of Cede & Co., as nominee of DTC.
(b) With respect to Bonds registered in the name of Cede&Co.,as nominee of DTC,the
City and the Registrar shall have no responsibility or obligation to any DTC Participant or to any
person on behalf of whom such DTC Participant holds an interest in the Bonds,except as provided in
this Ordinance. Without limiting the immediately preceding sentence, the City and the Registrar
shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC,
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Cede& Co. or any DTC Participant with respect to any ownership interest in the Bonds, (ii)the
delivery to any DTC Participant or any other person,other than an Owner,as shown on the Register,
of any notice with respect to the Bonds, including any notice of redemption, or(iii) the payment to
any DTC Participant or any other person, other than an Owner, as shown on the Register, of any
amount with respect to principal of,premium,if any,or interest on the Bonds. Notwithstanding any
other provision of this Ordinance to the contrary,the City and the Registrar shall be entitled to treat
and consider the person in whose name each Bond is registered in the Register as the absolute Owner
of such Bond for the purpose of payment of principal of and interest on the Bonds,for the purpose of
giving notices of redemption and other matters with respect to such Bond, for the purpose of
registering transfer with respect to such Bond,and for all other purposes whatsoever. The Registrar
shall pay all principal of,premium,if any,and interest on the Bonds only to or upon the order of the
respective Owners, as shown in the Register as provided in this Ordinance, or their respective
attorneys duly authorized in writing, and all such payments shall be valid and effective to fully
satisfy and discharge the City's obligations with respect to payments of principal,premium, if any,
and interest on the Bonds to the extent of the sum or sums so paid. No person other than an Owner,
as shown in the Register, shall receive a Bond certificate evidencing the obligation of the City to
make payments of amounts due pursuant to this Ordinance. Upon delivery by DTC to the Registrar
of written notice to the effect that DTC has determined to substitute a new nominee in place of
Cede& Co., and subject to the provisions of this Ordinance with respect to interest checks being
mailed to the Owner of record as of the Record Date, the phrase "Cede& Co." in this Ordinance
shall refer to such new nominee of DTC.
15. Successor Securities Depository;Transfer Outside Book-Entry Only System. In the
event that the City in its sole discretion,determines that the beneficial owners of the Bonds be able to
obtain certificated Bonds, or in the event DTC discontinues the services described herein, the City
shall(i) appoint a successor securities depository,qualified to act as such under Section 17(a)of the
Securities and Exchange Act of 1934, as amended,notify DTC and DTC Participants,as identified
by DTC,of the appointment of such successor securities depository and transfer one or more separate
Bonds to such successor securities depository or(ii) notify DTC and DTC Participants,as identified
by DTC,of the availability through DTC of Bonds and transfer one or more separate Bonds to DTC
Participants having Bonds credited to their DTC accounts,as identified by DTC. In such event,the
Bonds shall no longer be restricted to being registered in the Register in the name of Cede&Co.,as
nominee of DTC, but may be registered in the name of the successor securities depository, or its
nominee,or in whatever name or names Owners transferring or exchanging Bonds shall designate,in
accordance with the provisions of this Ordinance.
16. Payments to Cede &Co. Notwithstanding any other provision of this Ordinance to
the contrary,so long as any Bonds are registered in the name of Cede&Co.,as nominee of DTC,all
payments with respect to principal of, premium, if any, and interest on such Bonds, and all notices
with respect to such Bonds, shall be made and given, respectively, in the manner provided in the
Blanket Letter of Representations.
17. Optional and/or Mandatory Redemption; Defeasance. The Bonds are subject to
optional and/or mandatory redemption as set forth in the Form of Bond in this Ordinance and in the
Officer's Pricing Certificate.
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Principal amounts maybe redeemed only in integral multiples of$5,000. If a Bond subject to
redemption is in a denomination larger than $5,000, a portion of such Bond may be redeemed,but
only in integral multiples of $5,000. Upon surrender of any Bond for redemption in part, the
Registrar,in accordance with Section 11 hereof,shall authenticate and deliver in exchange therefor a
Bond or Bonds of like maturity and interest rate in an aggregate principal amount equal to the
unredeemed portion of the Bond so surrendered.
Notice of any redemption identifying the Bonds to be redeemed in whole or in part shall be
given by the Registrar at least thirty days prior to the date fixed for redemption by sending written
notice by first class mail to the Owner of each Bond to be redeemed in whole or in part at the address
shown on the Register. Such notices shall state the redemption date,the redemption price,the place
at which Bonds are to be surrendered for payment and, if less than all Bonds outstanding of a
particular maturity are to be redeemed,the numbers of the Bonds or portions thereof of such maturity
to be redeemed. Any notice given as provided in this Section shall be conclusively presumed to have
been duly given,whether or not the Owner receives such notice. By the date fixed for redemption,
due provision shall be made with the Registrar for payment of the redemption price of the Bonds or
portions thereof to be redeemed,plus accrued interest to the date fixed for redemption. When Bonds
have been called for redemption in whole or in part and due provision has been made to redeem same
as herein provided, the Bonds or portions thereof so redeemed shall no longer be regarded as
outstanding except for the purpose of receiving payment solely from the funds so provided for
redemption, and the rights of the Owners to collect interest which would otherwise accrue after the
redemption date on any Bond or portion thereof called for redemption shall terminate on the date
fixed for redemption.
The Bonds may be discharged, defeased, redeemed or refunded in any manner now or
hereafter permitted by law.
18. Forms. The form of the Bond, including the form of Registration Certificate of the
Comptroller,which shall be attached or affixed to the Initial Bond,the form of Assignment and the
form of the Registrar's Authentication Certificate, , shall be,respectively, substantially as follows,
with such additions, deletions and variations as may be necessary to conform to the terms specified
in the Officer's Pricing Certificate:
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(a) Form of Bond.
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTIES OF BRAZORIA AND HARRIS
REGISTERED REGISTERED
NUMBER DENOMINATION
CITY OF PEARLAND, TEXAS
PERMANENT IMPROVEMENT
INTEREST RATE: MATURITY DATE: ISSUE DATE: CUSIP:
March 1, 20
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
The City of Pearland, Texas (the"City")promises to pay to the registered owner identified
above,or registered assigns,on the maturity date specified above,upon presentation and surrender of
this Bond at the principal payment office of Wells Fargo Bank, N.A., in Dallas, Texas (the
"Registrar"), the principal amount identified above, payable in any coin or currency of the United
States of America which on the date of payment is legal tender for the payment of debts due the
United States of America,and to pay interest thereon at the rate shown above,calculated on the basis
of a 360-day year of twelve 30-day months,from 1 ,or the most recent interest payment
date to which interest has been paid or duly provided for. Interest on this Bond is payable by check
on March 1 and September 1 beginning on 1 ,mailed to the registered owner of record
as of the close of business on the 15th day of the month preceding each interest payment date.
THIS BOND is one of a duly authorized issue of Bonds, aggregating $ 2 (the
"Bonds"), issued for(i) purposes authorized by the Election as set forth in the Ordinance(defined
below) and(ii)the purpose of refunding a portion of the City's outstanding obligations,under and in
strict conformity with the Constitution and laws of the State of Texas,particularly Chapters 1207 and
1371, Texas Government Code, as amended, and pursuant to an ordinance adopted by the City
Council (the"Ordinance"), which Ordinance is of record in the official minutes of the City.
2 Insert from Officers Pricing Certificate.
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THE CITY RESERVES THE RIGHT, at its option,to redeem Bonds maturing on and after
March 1, 20 3 , in whole or from time to time in part, in integral multiples of$5,000, on March 1,
20 4 , or any date thereafter at par plus accrued interest on the principal amounts called for
redemption to the date fixed for redemption. If less than all the Bonds are to be redeemed,the City
shall select the Bonds to be redeemed.
[If applicable,mandatory redemption language]
NOTICE OF ANY REDEMPTION shall be given by the Registrar at least thirty(30) days
prior to the date fixed for redemption by first class mail, addressed to the registered owners of each
Bond to be redeemed in whole or in part at the address shown on the books of registration kept by
the Registrar. When Bonds or portions thereof have been called for redemption, and due provision
has been made to redeem the same,the principal amounts so redeemed shall be payable solely from
the funds provided for redemption,and interest which would otherwise accrue on the amounts called
for redemption shall terminate on the date fixed for redemption.
THIS BOND IS TRANSFERABLE only upon presentation and surrender at the principal
payment office of the Registrar in Dallas, Texas, duly endorsed for transfer or accompanied by an
assignment duly executed by the registered owner or his authorized representative, subject to the
terms and conditions of the Ordinance.
THE BONDS ARE EXCHANGEABLE at the principal payment office of the Registrar in
Dallas,Texas, for Bonds in the principal amount of$5,000 or any integral multiple thereof, subject
to the terms and conditions of the Ordinance.
THIS BOND shall not be valid or obligatory for any purpose or be entitled to any benefit
under the Ordinance unless this Bond is either(i) registered by the Comptroller of Public Accounts
of the State of Texas by registration certificate attached or affixed hereto or(ii) authenticated by the
Registrar by due execution of the authentication certificate endorsed hereon.
THE REGISTERED OWNER of this Bond,by acceptance hereof,acknowledges and agrees
to be bound by all the terms and conditions of the Ordinance.
THE CITY has covenanted in the Ordinance that it will at all times provide a legally qualified
registrar for the Bonds and will cause notice of any change of registrar to be mailed to each
registered owner.
3 Insert from Officers Pricing Certificate.
4 Insert from Officers Pricing Certificate.
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HOU:3325305.2
IT IS HEREBY certified, recited and covenanted that this Bond has been duly and validly
issued and delivered;that all acts,conditions and things required or proper to be performed,to exist
and to be done precedent to or in the issuance and delivery of this Bond have been performed, exist
and have been done in accordance with law; and that annual ad valorem taxes, within the limits
prescribed by law,sufficient to provide for the payment of the interest on and principal of this Bond,
as such interest comes due and such principal matures, have been levied and ordered to be levied
against all taxable property in the City, and have been pledged irrevocably for such payment.
IN WITNESS WHEREOF,this Bond has been signed with the manual or facsimile signature
of the Mayor and countersigned with the manual or facsimile signature of the City Secretary,and the
official seal of the City has been duly impressed, or placed in facsimile, on this Bond.
(AUTHENTICATION •� ''. CI OF Pr ARLAND, TEXAS
CERTIFICATE) ( LçJ f,Ok Greg Hill
Mayor Pro-Tem
y• �ngL n
Secretary
rY
(b) Form of Registration Certificate of Comptroller of Public Accounts.
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO.
I hereby certify that this Bond has been examined, certified as to validity, and approved by
the Attorney General of the State of Texas,and that this Bond has been registered by the Comptroller
of Public Accounts of the State of Texas.
WITNESS MY SIGNATURE AND SEAL this
Comptroller of Public Accounts
of the State of Texas
(SEAL)
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(c) Form of Registrar's Authentication Certificate.
AUTHENTICATION CERTIFICATE
It is hereby certified that this Bond has been delivered pursuant to the Bond
Ordinance described in the text of this Bond.
Wells Fargo Bank, N.A.
As Paying Agent/Registrar
By
Authorized Signature
Date of Authentication
(d) Form of Assignment.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns, and transfers unto
(Please print or type name, address, and zip code of Transferee)
(Please insert Social Security or Taxpayer Identification Number of Transferee)
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
attorney to transfer said Bond on the books kept for registration thereof, with full power of
substitution in the premises.
DATED:
Signature Guaranteed:
Registered Owner
NOTICE: The signature above must
correspond to the name of the registered
owner as shown on the face of this Bond in
NOTICE: Signature must be guaranteed 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.
(e) The Initial Bond shall be in the form set forth in paragraphs (a), (b) and (d) of this
Section, except for the following alterations:
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(i) immediately under the name of the Bond,the headings"INTEREST RATE"
and "MATURITY DATE" shall both be completed with the words "As
Shown Below" and the word"CUSIP" deleted;
(ii) in the first paragraph of the Bond, the words "on the maturity date
specified above" and "at the rate shown above" shall be deleted and the
following shall be inserted at the end of the first sentence "..., with such
principal to be paid in installments on March 1 in each of the years and in the
principal amounts identified in the following schedule and with such
installments bearing interest at the per annum rates set forth in the following
schedule:
[Information to be inserted from the Officer's Pricing Certificate]
(iii) the Initial Bond shall be numbered I-1.
19. CUSIP Numbers. CUSIP Numbers may be printed on the Bonds, but errors or
omissions in the printing of such numbers shall have no effect on the validity of the Bonds.
20. Debt Service Fund;Tax Levy. There is hereby established a separate fund of the City
to be known as the City of Pearland,Texas,Permanent Improvement 5 Debt Service
Fund(the"Debt Service Fund"), which shall be kept separate and apart from all other funds of the
City. The proceeds from all taxes levied, assessed and collected for and on account of the Bonds
authorized by this Ordinance shall be deposited, as collected, in the Debt Service Fund. While the
Bonds or any part of the principal thereof or interest thereon remain outstanding and unpaid,there is
hereby levied and there shall be annually assessed and collected in due time,form and manner,and at
the same time as other City taxes are assessed,levied and collected,in each year,a continuing direct
annual ad valorem tax, within the limits prescribed by law, upon all taxable property in the City,
sufficient to pay the current interest on the Bonds as the same becomes due and to provide and
maintain a debt service fund of not less than two percent of the principal amount of the Bonds or the
amount required to pay each installment of principal of the Bonds as the same matures,whichever is
greater, full allowance being made for delinquencies and costs of collection, and said taxes are
hereby irrevocably pledged to the payment of the interest on and principal of the Bonds and to no
other purpose.
To pay the debt service coming due on the Bonds prior to receipt of the taxes levied to pay
such debt service, there is hereby appropriated from current funds on hand, which are hereby
certified to be on hand and available for such purpose,an amount sufficient to pay such debt service,
and such amount shall be used for no other purpose.
21. Application of Chapter 1208,Government Code. Chapter 1208,Government Code,
applies to the issuance of the Bonds and the pledge of the taxes granted by the City under Section 20
of this Ordinance, and such pledge is therefore valid, effective and perfected. If Texas law is
amended at any time while the Bonds are outstanding an unpaid such that the pledge of the taxes
5 Insert from Officers Pricing Certificate.
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HOU:3325305.2
granted by the City under Section 20 of this Ordinance is to be subject to the filing requirements of
Chapter 9, Business & Commerce Code, then in order to preserve to the registered owners of the
Bonds the perfection of the security interest in said pledge,the City agrees to take such measures as
it determines are reasonable and necessary under Texas law to comply with the applicable provisions
of Chapter 9,Business&Commerce Code and enable a filing to perfect the security interest in said
pledge to occur.
22. Further Proceedings. After the Initial Bond has been executed,it shall be the duty of
the Mayor and other appropriate officials and agents of the City to deliver the Initial Bond and all
pertinent records and proceedings to the Attorney General of the State of Texas,for examination and
approval. After the Initial Bond has been approved by the Attorney General,it shall be delivered to
the Comptroller for registration. Upon registration of the Initial Bond, the Comptroller (or the
Comptroller's bond clerk or an assistant bond clerk lawfully designated in writing to act for the
Comptroller)shall manually sign the Comptroller's Registration Certificate prescribed herein and the
seal of said Comptroller shall be impressed, or placed in facsimile, thereon.
23. Sale; Bond Purchase Agreement. The Bonds shall be sold and delivered to the
Underwriter,who shall be designated in the Pricing Officer's Certificate,at the price set forth in the
Pricing Officer's Certificate and in accordance with the terms of the Bond Purchase Contract(in the
case of a negotiated sale)or the winning bid form (in the case of a competitive bid sale)which the
Pricing Officer is hereby authorized and directed to execute on behalf of the District. The Pricing
Officer and all other officers, agents and representatives of the District are hereby authorized to do
any and all things necessary or desirable to satisfy the conditions set out therein and to provide for
the issuance and delivery of the Bonds. The Pricing Officer is hereby authorized and directed to
execute the Bond Purchase Agreement or the winning bid form,as applicable,on behalf of the City,
and the Mayor,City Manager,Director of Finance and all other officers,agents and representatives
of the City are hereby authorized to do any and all things necessary or desirable to satisfy the
conditions set out therein and to provide for the issuance and delivery of the Bonds. In the event the
Bond Purchase Agreement or the winning bid form shall not be executed by the one year anniversary
of the date of this Ordinance(the"Expiration Date"),the delegation to the Pricing Officer pursuant
to this Ordinance shall cease to be effective unless the City shall act to extend such delegation.
Bonds sold pursuant to a Bond Purchase Agreement or winning bid form executed on or before the
Expiration Date may be delivered after such date.
24. Federal Income Tax Exclusion.
The City intends that the interest on the Bonds shall be excludable from gross income of the
owners thereof for federal income tax purposes pursuant to Sections 103 and 141 through 150 of the
Internal Revenue Code of 1986, as amended, (the"Code") and all applicable temporary,proposed
and final regulations(the"Regulations")and procedures promulgated thereunder and applicable to
the Bonds. For this purpose, the City covenants that it will monitor and control the receipt,
investment, expenditure and use of all gross proceeds of the Bonds (including all property, the
acquisition, construction or improvement of which is to be financed directly or indirectly with the
proceeds of the Bonds)and take or omit to take such other and further actions as may be required by
Sections 103 and 141 through 150 of the Code and the Regulations to cause the interest on the Bonds
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to be and remain excludable from the gross income, as defined in Section 61 of the Code, of the
owners of the Bonds for federal income tax purposes. Without limiting the generality of the
foregoing, the City shall comply with each of the following covenants:
(a) The City shall not use, permit the use of or omit to use Gross Proceeds or any other
amounts(or any property the acquisition,construction or improvement of which is to
be financed directly or indirectly with Gross Proceeds)in a manner which,if made or
omitted,respectively, would cause the interest on any Bond to become includable in
the gross income, as defined in Section 61 of the Code, of the owner thereof for
federal income tax purposes. Without limiting the generality of the foregoing,unless
and until the City shall have received a written opinion of counsel nationally
recognized in the field of municipal bond law to the effect that failure to comply with
such covenant will not adversely affect the exemption from federal income tax of the
interest on any Bond,the City shall comply with each of the specific covenants in this
Section.
(b) Except as permitted by Section 141 of the Code and the regulations and rulings
thereunder, the City shall, at all times prior to the last stated maturity of the Bonds,
(1) exclusively own, operate, and possess all property the acquisition,
construction, or improvement of which is to be financed directly or indirectly with Gross
Proceeds of such series of the Bonds(including property financed with Gross Proceeds of the
Refunded Obligations or notes or bonds refunded by the Refunded Obligations and not use or
permit the use of such Gross Proceeds or any property acquired, constructed, or improved
with such Gross Proceeds in any activity carried on by any person or entity other than a state
or local government, unless such use is solely as a member of the general public, or
(2) not directly or indirectly impose or accept any charge or other payment
for use of Gross Proceeds of such series of the Bonds or any property the acquisition,
construction or improvement of which is to be financed directly or indirectly with such Gross
Proceeds(including property financed with Gross Proceeds of the Refunded Obligations or
notes or bonds refunded by the Refunded Obligations other than taxes of general application
and interest earned on investments acquired with such Gross Proceeds pending application
for their intended purposes.
(c) Except to the extent permitted by Section 141 of the Code and the regulations and
rulings thereunder, the City shall not use Gross Proceeds of the Bonds to make or
finance loans to any person or entity other than a state or local government. For
purposes of the foregoing covenant,Gross Proceeds are considered to be"loaned"to a
person or entity if(1)property acquired,constructed or improved with Gross Proceeds
(including property financed with Gross Proceeds of the Refunded Obligations or
notes or bonds refunded by the Refunded Obligations is sold or leased to such person
or entity in a transaction which creates a debt for federal income tax purposes, (2)
capacity in or service from such property is committed to such person or entity under a
take-or-pay, output, or similar contract or arrangement, or (3) indirect benefits, or
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burdens and benefits of ownership, of such Gross Proceeds or such property are
otherwise transferred in a transaction which is the economic equivalent of a loan.
(d) Except to the extent permitted by Section 148 of the Code and the regulations and
rulings thereunder,the City shall not,at any time prior to the earlier of the final stated
maturity or final payment of the Refunded Obligations, directly or indirectly invest
Gross Proceeds of such Bonds in any Investment (or use such Gross Proceeds to
replace money so invested), if as a result of such investment the Yield of all
Investments allocated to such Gross Proceeds whether then held or previously
disposed of, exceeds the Yield on the Refunded Obligations.
(e) Based on all of the facts and estimates now known or reasonably expected to be in
existence on the date the Bonds are delivered, the City reasonably expects that the
proceeds of the Bonds and the Refunded Obligations (to the extent any of such
proceeds remain unexpended) will not be used in a manner that would cause the
Bonds or the Refunded Obligations or any portion thereof to be "arbitrage bonds"
within the meaning of Section 148 of the Code.
(f) At all times while the Bonds are outstanding, the City will identify and properly
account for all amounts constituting gross proceeds of the Bonds in accordance with
the Regulations.The City will monitor the yield on the investments of the proceeds of
the Bonds and,to the extent required by the Code and the Regulations,will restrict the
yield on such investments to a yield which is not materially higher than the yield on
the Bonds.To the extent necessary to prevent the Bonds from constituting"arbitrage
bonds," the City will make such payments as are necessary to cause the yield on all
yield restricted nonpurpose investments allocable to the Bonds to be less than the
yield that is materially higher than the yield on the Bonds.
(g) The City will not take any action or knowingly omit to take any action, if taken or
omitted,would cause the Bonds to be treated as"federally guaranteed"obligations for
purposes of Section 149(b) of the Code.
(h) The City represents that not more than fifty percent(50%)of the proceeds of any new
money portion of the Bonds or any new money issue refunded by, the Refunded
Bonds was invested in nonpurpose investments(as defined in Section 148(f)(b)(A)of
the Code) having a substantially guaranteed yield for four years or more within the
meaning of Section 149(g)(3)(A)(ii)of the Code,and the City reasonably expected at
the time each issue of the Refunded Bonds was issued that at least eighty-five percent
(85%)of the spendable proceeds of the Bonds or the Refunded Bonds would be used
to carry out the governmental purpose of such Bonds within the corresponding three-
year period beginning on the respective dates of the Bonds or the Refunded Bonds.
(i) The City will take all necessary steps to comply with the requirement that certain
amounts earned by the City on the investment of the gross proceeds of the Bonds, if
any, be rebated to the federal government. Specifically, the City will (i) maintain
records regarding the receipt,investment and expenditure of the gross proceeds of the
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Bonds as may be required to calculate such excess arbitrage profits separately from
records of amounts on deposit in the funds and accounts of the City allocable to other
obligations of the City or moneys which do not represent gross proceeds of any
obligations of the City and retain such records for at least six years after the day on
which the last outstanding Bond is discharged, (ii) account for all gross proceeds
under a reasonable, consistently applied method of accounting, not employed as an
artifice or device to avoid,in whole or in part,the requirements of Section 148 of the
Code, including any specified method of accounting required by applicable
Regulations to be used for all or a portion of the gross proceeds,(iii)calculate,at such
times as are required by applicable Regulations, the amount of excess arbitrage
profits,if any,earned from the investment of the gross proceeds of the Bonds and(iv)
timely pay,as required by applicable Regulations, all amounts required to be rebated
to the federal government. In addition,the City will exercise reasonable diligence to
assure that no errors are made in the calculations required by the preceding sentence
and, if such an error is made, to discover and promptly correct such error within a
reasonable amount of time thereafter,including payment to the federal government of
any delinquent amounts owed to it, including interest thereon and penalty.
(j) The City will not indirectly pay any amount otherwise payable to the federal
government pursuant to the foregoing requirements to any person other than the
federal government by entering into any investment arrangement with respect to the
gross proceeds of the Bonds that might result in a reduction in the amount required to
be paid to the federal government because such arrangement results in smaller profit
or a larger loss than would have resulted if such arrangement had been at arm's length
and had the yield on the issue not been relevant to either party.
(k) The City will timely file or cause to be filed with the Secretary of the Treasury of the
United States the information required by Section 149(e)of the Code with respect to
the Bonds on such form and in such place as the Secretary may prescribe.
(1) The City will not issue or use the Bonds as part of an"abusive arbitrage device"(as
defined in Section 1.148 10(a)of the Regulations).Without limiting the foregoing,the
Bonds are not and will not be a part of a transaction or series of transactions that
attempts to circumvent the provisions of Section 148 of the Code and the Regulations,
by (i) enabling the City to exploit the difference between tax exempt and taxable
interest rates to gain a material financial advantage, or(ii) increasing the burden on
the market for tax-exempt obligations.
(m) Proper officers of the City charged with the responsibility for issuing the Bonds are
hereby directed to make, execute and deliver certifications as to facts, estimates or
circumstances in existence as of the Issue Date and stating whether there are facts,
estimates or circumstances that would materially change the City's expectations. On
or after the Issue Date,the City will take such actions as are necessary and appropriate
to assure the continuous accuracy of the representations contained in such certificates.
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(n) The covenants and representations made or required by this Section are for the benefit
of the Bond holders and any subsequent Bond holder, and may be relied upon by the
Bond holder and any subsequent Bond holder and bond counsel to the City.
In complying with the foregoing covenants, the City may rely upon an unqualified opinion
issued to the City by nationally recognized bond counsel that any action by the City or reliance upon
any interpretation of the Code or Regulations contained in such opinion will not cause interest on the
Bonds to be includable in gross income for federal income tax purposes under existing law.
Notwithstanding any other provision of this Ordinance, the City's representations and
obligations under the covenants and provisions of this Section 7.5 shall survive the defeasance
and discharge of the Bonds for as long as such matters are relevant to the exclusion of interest on
the Bonds from the gross income of the owners for federal income tax purposes.
25. Use of Proceeds. Proceeds from the sale of the Bonds shall,promptly upon receipt by
the City,be applied as follows:
(a) Accrued interest in the amount of$ 6 and,if necessary,net premium
on the Bonds in the amount of$ 7 , shall be deposited into the Debt
Service Fund.
(b) Premium in the amount of$ 8 shall be used to pay the underwriter's
discount.
(c) Net premium in the amount of$ 9 shall be used to pay the costs of
issuance.
(d) Bond proceeds in the amount of$ shall be used for the purposes
described in Section 3(i).
(d) The remaining proceeds from the sale of the Bonds, together with other
available funds of the City(in the amount of$ 10 ),shall be applied
to establish an escrow fund to refund the Refunded Bonds or a deposit with
the paying agent for the Refunded Bonds, as more fully provided in Section
26 below, and, to the extent not otherwise provided for, to pay all expenses
arising in connection with the issuance of the Bonds, the establishment of
such escrow fund and the refunding of the Refunded Bonds.
6 Insert from Officer's Pricing Certificate.
7 Insert from Officer's Pricing Certificate.
8 Insert from Officer's Pricing Certificate.
9 Insert from Officer's Pricing Certificate.
1°Insert from Officers Pricing Certificate.
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(e) Any proceeds of the Bonds remaining after making all such deposits and
payments shall be deposited into the Debt Service Fund.
26. Escrow Agreement/Deposit with Paying Agent for Refunding Bonds.The discharge
and defeasance of the Refunded Bonds shall be effectuated pursuant to the terms and provisions of
an Escrow Agreement to be entered into by and between the City and the Escrow Agent or pursuant
to a deposit of funds with the paying agent for the Refunded Bonds.The terms and provisions of the
Escrow Agreement, if needed, are hereby approved, subject to such insertions, additions and
modifications as shall be necessary (a) to carry out the program designed for the City by the
Underwriter, which, if required, shall be certified as to mathematical accuracy by Grant Thornton
LLP, (b) to minimize the City's costs of refunding, (c) to comply with all applicable laws and
regulations relating to the refunding of the Refunded Bonds and(d)to carry out the other intents and
purposes of this Ordinance and comply with the terms of the Officer's Pricing Certificate; and the
Mayor or Mayor Pro Tem is hereby authorized to execute and deliver such Escrow Agreement on
behalf of the City in multiple counterparts and the City Secretary or an Assistant City Secretary is
hereby authorized to attest thereto and affix the City's seal.
27. Redemption of Refunded Bonds. The City has irrevocably exercised its option to call
the bonds of the City for redemption prior to maturity on the dates and at the prices shown on Exhibit
B to the Officer's Pricing Certificate, and authorized and directed notice of such redemption to be
given in accordance with the ordinances authorizing the issuance of such bonds.
28. Purchase of Escrowed Securities. If an Escrow Agreement is utilized, to assure the
purchase of the Escrowed Securities referred to in the Escrow Agreement, if required, the Pricing
Officer is hereby authorized to subscribe for, agree to purchase,and purchase obligations which are
authorized investments for escrow accounts pursuant to Section 1207.062,Texas Government Code,
in such amounts and maturities and bearing interest at such rates as may be provided for in the
Report, and to execute any and all subscriptions, purchase agreements, commitments, letters of
authorization and other documents necessary to effectuate the foregoing,and any actions heretofore
taken for such purpose are hereby ratified and approved.
29. Continuing Disclosure Undertaking. (a) Annual Reports. The City will provide
certain updated financial information and operating data to the MSRB annually in an electronic
format as prescribed by the MSRB and available via the Electronic Municipal Market Access
("EMMA")system at www.emma.msrb.org. The information to be updated includes all quantitative
financial information and operating data with respect to the City of the general type included in the
final Official Statement authorized by Section 31 of this Ordinance under the headings
"INVESTMENT AUTHORITY AND INVESTMENT OBJECTIVES OF THE CITY - Current
Investments," "CITY TAX DEBT," "TAX DATA" (except under the subheading "Estimated
Overlapping Taxes"), "SELECTED FINANCIAL DATA,"and in APPENDIX`B." The City will
update and provide this information within six months after the end of each fiscal year.
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If the City changes its fiscal year,it will submit a notice of such change to the MSRB,and the
date of the new fiscal year end prior to the next date by which the City otherwise would be required
to provide financial information and operating data pursuant to this Section.
The financial information and operating data to be provided may be set forth in full in one or
more documents or may be included by specific reference to any document available to the public on
the MSRB's Internet Web site or filed with the SEC, as permitted by the SEC Rule. The updated
information will include audited financial statements, if the City commissions an audit and it is
completed by the required time. If audited financial statements are not available by the required
time,the City will provide unaudited financial statements by the required time and audited financial
statements when and if such audited statements become available. Any such financial statements
will be prepared in accordance with the accounting principals described in APPENDIX B or such
other accounting principals as the City may require to employ from time to time pursuant to State
law or regulation.
(b) Material Event Notices. The City shall notify the MSRB in an electronic format
prescribed by the MSRB, in a timely manner(not in excess of ten(10)days after the occurrence of
the event), of any of the following events with respect to the Bonds:
(i) Principal and interest payment delinquencies;
(ii) Non-payment related defaults, if material;
(iii) Unscheduled draws on debt service reserves reflecting financial
difficulties;
(iv) Unscheduled draws on credit enhancements reflecting financial
difficulties;
(v) Substitution of credit or liquidity providers or their failure to perform;
(vi) Adverse tax opinions,the issuance by the Internal Revenue Service of
proposed or final determinations of taxability, Notices of Proposed
Issue (IRS Form 5701-TEB) or other material notices or
determinations with respect to the tax status of the Bonds, or other
material events affecting the tax status of the Bonds;
(vii) Modifications to rights of holders of the Bonds, if material;
(viii) Bond calls, if material, and tender offers;
(ix) Defeasances;
(x) Release, substitution, or sale of property securing repayment of the
Bonds, if material;
(xi) Rating changes;
(xii) Bankruptcy, insolvency, receivership or similar event of the City;
(xiii) The consummation of a merger, consolidation, or acquisition
involving the City or the sale of all or substantially all of the assets of
the City, other than in the ordinary course of business, the entry
into a definitive agreement to undertake such an action or the
termination of a definitive agreement relating to any such actions,
other than pursuant to its terms, if material; and
(xiv) Appointment of a successor Paying Agent/Registrar or change in the
name of the Paying Agent/Registrar, if material.
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For the purposes, any event described in the immediate proceeding paragraph (12) is
considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or
similar officer for the City in a proceeding Under States Bankruptcy Code or any other proceeding
under state or federal law in which a court or governmental authority has assumed jurisdiction over
substantially all of the assets or business of the City, or if such jurisdiction has been assumed by
leaving the existing governing body and officials or officers in possession but subject to the
supervision and orders of a court or governmental authority,or the entry of order confirming a plan
of reorganization, arrangement or liquidation by a court or governmental authority having
supervision or jurisdiction over substantially all of the assets or business of the City.
The City shall notify the MSRB, in a timely manner, of any failure by the City to provide
financial information or operating data in accordance this Section by the time required by such
Section.
(c) Limitations, Disclaimers, and Amendments. The City shall be obligated to observe
and perform the covenants specified in this Section for so long as,but only for so long as, the City
remains an"obligated person"with respect to the Bonds within the meaning of the Rule,except that
the City in any event will give notice of any deposit made in accordance with Texas law that causes
Bonds no longer to be outstanding.
The provisions of this Section are for the sole benefit of the holders and the beneficial owners
of the Bonds, and nothing in this Section, express or implied, shall give any benefit or any legal or
equitable right,remedy,or claim hereunder to any other person. The City undertakes to provide only
the financial information, operating data, financial statements, and notices which it has expressly
agreed to provide pursuant to this Section and does not hereby undertake to provide any other
information that may be relevant or material to a complete presentation of the City's financial results,
condition,or prospects or hereby undertake to update any information provided in accordance with
this Section or otherwise, except as expressly provided herein. The City does not make any
representation or warranty concerning such information or its usefulness to a decision to invest in or
sell Bonds at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR
BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON,IN CONTRACT OR TORT,
FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE CITY,
WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT
SPECIFIED IN THIS SECTION,BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON,
IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE
UNLIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE.
No default by the City in observing or performing its obligations under this Section shall
comprise a breach of or default under this Order for purposes of any other provision of this Order.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the
duties of the City under federal and state securities laws.
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HOU:3325305.2
The provisions of this Section may be amended by the City from time to time to adapt to
changed circumstances that arise from a change in legal requirements, a change in law, or a change
in the identity, nature, or status or type of principal payment of the City, if(1)the agreement, as so
amended, would have permitted an underwriter to purchase or sell Bonds in the initial primary
offering in compliance with the Rule,taking into account any amendments or interpretations of the
Rule to the date of such amendment, as well as such changed circumstances, and (2) either(a) the
holders of a majority in aggregate amount of the outstanding Bonds consent to such amendment or
(b)a person unaffiliated with the City(such as nationally recognized bond counsel)determines that
the amendment will not materially impair the interests of the holders and beneficial owners of the
Bonds. The City may also amend or repeal the provisions of this continuing disclosure agreement if
the SEC amends or repeals the applicable provisions of the Rule or a court of final jurisdiction enters
judgment that such provisions of the Rule are invalid,but only if and to the extent that the provisions
of this sentence would not prevent an underwriter from lawfully purchasing or selling Bonds in the
primary offering of the Bonds. If any such amendment is made, the City will include in its next
annual update an explanation in narrative form of the reasons for the change and its impact on the
type of operating data or financial information being provided.
30. Related Matters. To satisfy in a timely manner all of the City's obligations under this
Ordinance, the Bond Purchase Agreement, and the Escrow Agreement, the Mayor or Mayor Pro
Tem,the City Secretary or an Assistant City Secretary,the City Manager, and all other appropriate
officers and agents of the City are hereby authorized and directed to take all other actions that are
reasonably necessary to provide for the refunding of the Refunded Bonds, including, without
limitation,executing and delivering on behalf of the City all certificates,consents,receipts,requests,
and other documents as may be reasonably necessary to satisfy the City's obligations under the
Escrow Agreement,the Bond Purchase Agreement,and this Ordinance and to direct the application
of funds of the City consistent with the provisions of the Escrow Agreement and this Ordinance.
31. Power to Revise Form of Documents. Notwithstanding any other provision of this the
Pricing Officer is hereby authorized to make or approve such revisions, additions, deletions, and
variations to this Ordinance and in the form of the documents attached hereto as exhibits as, in the
judgment of the Pricing Officer,and in the opinion of Bond Counsel to the City,maybe necessary or
convenient to carry out or assist in carrying out the purposes of this Ordinance, the Preliminary
Official Statement,the final Official Statement,or as may be required for approval of the Bonds by
the Attorney General of Texas;provided,however,that any changes to such documents resulting in
substantive amendments to the terms and conditions of the Bonds or such documents shall be subject
to the prior approval of the Board.
32. Amendments. The City may amend this Ordinance without the consent of or notice to
any Owner in any manner not detrimental to the interests of the Owners,including the curing of any
ambiguity, inconsistency, or formal defect or omission therein. In addition, the City may with the
written consent of the holders of a majority of the aggregate principal amount of the Bonds then
outstanding affected thereby, amend, add to, or rescind any of the provisions of the Ordinance;
except that,without the consent of the Owners of the Bonds affected,no such amendment,addition
or rescission may(i)make any change in the maturity of any of the outstanding Bonds;(ii)reduce the
rate of interest borne by any of the outstanding Bonds; (iii)reduce the amount of the principal of or
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HOU:3325305.2
redemption premium,if any,payable on any outstanding Bonds;(iv)modify the terms of payment of
principal or of interest or redemption premium on outstanding Bonds or any of them or impose any
condition with respect to such payment; or (v) change the minimum percentage of the principal
amount of the Bonds necessary for consent to such amendment.
33. Official Statement. The City Council hereby approves the form and content of the
Preliminary Official Statement prepared for the initial offering and sale of the Bonds and hereby
authorizes the preparation of a final Official Statement reflecting the terms of the Bond Purchase
Agreement and other relevant matters. The use of such Official Statement in the reoffering of the
Bonds by the Underwriter is hereby approved and authorized.
34. Registrar. The form of agreement setting forth the duties of the Registrar is hereby
approved,and the appropriate officials of the City are hereby authorized to execute such agreement
for and on behalf of the City.
35. No Personal Liability. No recourse shall be had for payment of the principal of or
interest on any Bonds or for any claim based thereon, or on this Ordinance, against any official or
employee of the City or any person executing any Bonds.
36. Open Meeting. The meeting at which this Ordinance is adopted was open to the
public,and public notice of the time,place and purpose of said meeting was given,all as required by
the Texas Open Meetings Act;and such notice as given is hereby authorized,approved,adopted and
ratified.
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HOU:3325305.2
PASSED AND APPROVED ON FIRST READING THIS THE 24th DAY OF JUNE 2013.
(ji
reg Hill
Mayor Pro-Tern
City of Pearland, Texas
ATTEST:
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PASSED AND APPROVED ON SECOND AND FINAL READING THIS THE 8`1 DAY
OF JULY 2013.
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TOM REID
MAYOR
City of Pearland, Texas
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ity of Pearland, Texas "" „,
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HOU:3325305.2
EXHIBIT A
ALL THE CITY'S OUTSTANDING OBLIGATIONS
Permanent Improvement Bonds, Series 2002
Certificates of Obligation, Series 2003
Permanent Improvement Bonds, Series 2003
Water and Sewer System Revenue Bonds, Series 2003
Certificates of Obligation, Series 2004
Permanent Improvement and Refunding Bonds, Series 2005
Permanent Improvement and Refunding Bonds, Series 2006
Certificates of Obligation, Series 2006
Certificates of Obligation, Series 2007
Waterworks and Sewer System Combined Unlimited Tax and Revenue Bonds, Series 2007
Permanent Improvement Bonds, Series 2007
Certificates of Obligation, Series 2008
Permanent Improvement Bonds, Series 2008
Certificates of Obligation, Series 2009
Permanent Improvement and Refunding Bonds, Series 2009
Certificates of Obligation, Series 2009A
Permanent Improvement Bonds, Series 2010A
Permanent Improvement Refunding Bonds, Series 2010B
Certificates of Obligation, Series 2011
Permanent Improvement Bonds, Series 2011
Permanent Improvement Refunding Bonds, Series 2012
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HOU:3325305.2