HomeMy WebLinkAboutORD 2006-080 BOND ORDINANCE
NO. 2006-80
CITY OF GRAPEVINE, TEXAS
GENERAL OBLIGATION REFUNDING BONDS
SERIES 2006
Adopted: November 7, 2006
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND OTHER PRELIMINARY MATTERS
Section 1.01. Definitions 2
Section 1.02. Findings 4
Section 1.03. Table of Contents, Titles and Headings 4
Section 1.04. Interpretation 4
ARTICLE II
SECURITY FOR THE BONDS; INTEREST AND SINKING FUND
Section 2.01. Tax Levy 4
Section 2.02. Interest and Sinking Fund 5
ARTICLE III
AUTHORIZATION; GENERAL TERMS AND PROVISIONS
REGARDING THE BONDS
Section 3.01. Authorization 5
Section 3.02. Date, Denomination, Maturities and Interest 6
Section 3.03. Medium, Method and Place of Payment 6
Section 3.04. Execution and Registration of Bonds 7
Section 3.05. Ownership 8
Section 3.06. Registration, Transfer and Exchange 8
Section 3.07. Cancellation 9
Section 3.08. Temporary Bonds 9
Section 3.09. Replacement Bonds 10
Section 3.10. Book-Entry Only System 11
Section 3.11. Successor Securities Depository; Transfer Outside Book-Entry Only System 11
Section 3.12. Payments to Cede & Co 12
ARTICLE IV
REDEMPTION OF BONDS BEFORE MATURITY
Section 4.01. Limitation on Redemption 12
Section 4.02. Optional Redemption 12
Section 4.03. Mandatory Sinking Fund Redemption 12
Section 4.04. Partial Redemption 13
Section 4.05. Notice of Redemption to Owners 13
Section 4.06. Payment Upon Redemption 14
Section 4.07. Effect of Redemption 14
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ARTICLE V
PAYING AGENT/REGISTRAR
Section 5.01. Appointment of Initial Paying Agent/Registrar 14
Section 5.02. Qualifications 14
Section 5.03. Maintaining Paying Agent/Registrar 15
Section 5.04. Termination 15
Section 5.05. Notice of Change to Owners 15
Section 5.06. Agreement to Perform Duties and Functions 15
Section 5.07. Delivery of Records to Successor 15
ARTICLE VI
FORM OF THE BONDS
Section 6.01. Form Generally 15
Section 6.02. Form of the Bonds 16
Section 6.03. CUSIP Registration 22
Section 6.04. Legal Opinion 22
Section 6.05. Statement of Insurance 22
ARTICLE VII
SALE AND DELIVERY OF BONDS, DEPOSIT OF PROCEEDS
Section 7.01. Sale of Bonds, Official Statement 22
Section 7.02. Control and Delivery of Bonds 24
Section 7.03. Deposit of Proceeds 24
ARTICLE VIII
INVESTMENTS
Section 8.01. Investments 25
Section 8.02. Investment Income 25
ARTICLE IX
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 9.01. Payment of the Bonds 25
Section 9.02. Other Representations and Covenants 25
Section 9.03. Provisions Concerning Federal Income Tax Exclusion 26
Section 9.04. No Private Use or Payment and No Private Loan Financing 26
Section 9.05. No Federal Guaranty 26
Section 9.06. Bonds are not Hedge Bonds 27
Section 9.07. No-Arbitrage Covenant 27
Section 9.08. Arbitrage Rebate 27
Section 9.09. Information Reporting 27
Section 9.10. Continuing Obligation 28
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ARTICLE X
DEFAULT AND REMEDIES
Section 10.01. Events of Default 28
Section 10.02. Remedies for Default 28
Section 10.03. Remedies Not Exclusive 28
ARTICLE XI
DISCHARGE
Section 11.01. Discharge 29
ARTICLE XII
CONTINUING DISCLOSURE UNDERTAKING
Section 12.01. Annual Reports 29
Section 12.02. Material Event Notices 29
Section 12.03. Limitations, Disclaimers and Amendments 30
ARTICLE XIII
REFUNDED OBLIGATIONS
Section 13.01. Payment of Paying Agency 31
Section 13.02. Escrow Agreement 31
Section 13.03. Redemption of Refunded Obligations 32
Section 13.04. Purchase of Federal Securities 32
Schedule I - Schedule of Refunded Obligation Candidates S-1
Exhibit A- Description of Annual Disclosure of Financial Information A-1
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ORDINANCE NO. 2006-80
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF GRAPEVINE,
TEXAS, GENERAL OBLIGATION REFUNDING BONDS, SERIES 2006, IN
AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $7,500,000;
PROVIDING FOR THE AWARD OF THE SALE THEREOF IN
ACCORDANCE WITH SPECIFIED PARAMETERS; AUTHORIZING THE
EXECUTION AND DELIVERY OF A PURCHASE CONTRACT RELATING
TO SAID BONDS; AUTHORIZING THE EXECUTION AND DELIVERY OF
A PAYING AGENT/REGISTRAR AGREEMENT AND AN ESCROW
AGREEMENT; APPROVING THE OFFICIAL STATEMENT; AND
ENACTING OTHER PROVISIONS RELATING THERETO
WHEREAS, there are presently outstanding certain obligations of the City, described on
Schedule I attached hereto and incorporated herein by reference for all purposes (collectively, the
"Refunded Obligation Candidates"), which are secured by a first lien on and pledge of the net
revenues of the City's combined waterworks and sewer system (the "System"); and
WHEREAS, Chapter 1207, Texas Government Code, as amended ("Chapter 1207")
further authorizes the City to enter into escrow agreements with any commercial bank with
respect to the safekeeping, investment, reinvestment, administration and disposition of any such
deposit, upon such terms and conditions as the City and such bank may agree, provided that such
deposits may be invested and reinvested only in direct obligations of the United States of
America, including obligations the principal of and interest on which are unconditionally
guaranteed by the United States of America, and which shall mature and bear interest payable at
such times and in such amounts as will be sufficient to provide for the scheduled payment or
prepayment of the Refunded Obligations; and
WHEREAS, The Bank of New York Trust Company, National Association, is a
commercial bank which does not act as depository for the City and the Escrow Agreement
hereinafter authorized constitutes an escrow agreement of the kind authorized by said Chapter
1207; and
WHEREAS, the City Council of the City hereby finds and determines that the issuance
and delivery of the refunding bonds hereinafter authorized is in the public interest and the use of
the proceeds in the manner herein specified constitutes a valid public purpose; and
WHEREAS, the City Council hereby finds and determines that the refunding
contemplated in this Ordinance will benefit the City by providing a present value savings of debt
service payable by the City in an amount to be certified in the Pricing Certificate, and that such
benefit is sufficient consideration for the refunding of the Refunded Obligations; and
WHEREAS, the City Council has found and determined that it is necessary and in the
best interest of the City and its citizens that it authorize by this Ordinance the issuance and
delivery of the bonds in a single series at this time; and
WHEREAS, the meeting at which this Ordinance is considered is open to the public as
required by law, and the public notice of the time, place and purpose of said meeting was given
as required by Chapter 551, Texas Government Code, as amended; therefore
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BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE:
ARTICLE I
DEFINITIONS AND OTHER PRELIMINARY MATTERS
Section 1.01. Definitions.
Unless otherwise expressly provided or unless the context clearly requires otherwise in
this Ordinance, the following terms shall have the meanings specified below:
"Bond"means any of the Bonds.
"Bond Date" means the date designated as the date of the Bonds by Section 3.02(a) of
this Ordinance.
"Bonds" means one or more series of the City's bonds authorized to be issued by
Section 3.01 of this Ordinance and designated as "City of Grapevine, Texas, General Obligation
Refunding Bonds, Series 2006."
"Closing Date"means the date of the initial delivery of and payment for the Bonds.
"Code" means the Internal Revenue Code of 1986, as amended, including applicable
regulations, published rulings and court decisions.
"Designated Payment/Transfer Office" means (i) with respect to the initial Paying
Agent/Registrar named in this Ordinance, the Designated Payment/Transfer Office as designated
in the Paying Agent/Registrar Agreement, or at such other location designated by the Paying
Agent/Registrar and (ii) with respect to any successor Paying Agent/Registrar, the office of such
successor designated and located as may be agreed upon by the City and such successor.
"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 clearance and settlement of securities transactions among DTC Participants.
"Escrow Agent" means The Bank of New York Trust Company, National Association,
Dallas, Texas.
"Escrow Agreement" means the escrow agreement, dated as of November 15, 2006,
between the City and the Escrow Agent, and any other escrow agreement authorized by and
entered into by the City pursuant to Section 7.01(a)herein.
"Escrow Fund"means the fund by that name established in the Escrow Agreement.
"Event of Default" means any event of default as defined in Section 10.01 of this
Ordinance.
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"Initial Bond"means the Initial Bond authorized by Section 3.04 of this Ordinance.
"Interest and Sinking Fund" means the interest and sinking fund established by
Section 2.02 of this Ordinance.
"Interest Payment Date" means the date or dates on which interest on the Bonds is
scheduled to be paid until their respective dates of maturity or prior redemption, such dates being
August 15 and February 15 as designated in the Pricing Certificate.
"MSRB"means the Municipal Securities Rulemaking Board.
"NRMSIR" means each person whom the SEC or its staff has determined to be a
nationally recognized municipal securities information repository within the meaning of the Rule
from time to time.
"Owner" means the person who is the registered owner of a Bond or Bonds, as shown in
the Register.
"Paying Agent/Registrar" means initially The Bank of New York Trust Company,
National Association, Dallas, Texas, or any successor thereto as provided in this Ordinance.
"Pricing Certificate" means a certificate or certificates to be signed by each member of
the Pricing Committee.
"Record Date" means the last business day of the month next preceding an Interest
Payment Date.
"Refunded Obligation Candidates" means the obligations of the City described in
Schedule I attached hereto which are authorized to be designated as Refunded Obligations in the
Pricing Certificate.
"Refunded Obligations" means those obligations of the City to be designated in the
Pricing Certificate from the universe of Refunded Obligation Candidates described in Schedule I
attached hereto.
"Register"means the Register specified in Section 3.06(a) of this Ordinance.
"Representation Letter" means the Blanket Letter of Representations between the City
and DTC.
"Rule"means SEC Rule 15c2-12, as amended from time to time.
"SEC"means the United States Securities and Exchange Commission.
"SID" means any person designated by the State of Texas or an authorized department,
office, or agency thereof as, and determined by the SEC or its staff to be, a state information
depository within the meaning of the Rule from time to time.
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"Unclaimed Payments" means money deposited with the Paying Agent/Registrar for the
payment of principal of or interest on the Bonds as the same come due and payable and
remaining unclaimed by the Owners of such Bonds after the applicable payment or redemption
date.
"Underwriter" means Southwest Securities, Inc., as more particularly described in the
Purchase Contract relating to the Bonds described in Section 7.01(a).
Section 1.02. Findings.
The declarations, determinations and findings declared, made and found in the preamble
to this Ordinance are hereby adopted, restated and made a part of the operative provisions hereof.
Section 1.03. Table of Contents, Titles and Headings.
The table of contents, 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 and shall never
be considered or given any effect in construing this Ordinance or any provision hereof or in
ascertaining intent, if any question of intent should arise.
Section 1.04. Interpretation.
(a) Unless the context requires otherwise, words of the masculine gender shall be
construed to include correlative words of the feminine and neuter genders and vice versa, and
words of the singular number shall be construed to include correlative words of the plural
number and vice versa.
(b) This Ordinance and all the terms and provisions hereof shall be liberally
construed to effectuate the purposes set forth herein.
ARTICLE II
SECURITY FOR THE BONDS; INTEREST AND SINKING FUND
Section 2.01. Tax Levy.
(a) Pursuant to the authority granted by the Texas Constitution and the laws of the
State of Texas, there shall be levied and there is hereby levied for the current year and for each
succeeding year hereafter while any of the Bonds or any interest thereon is outstanding and
unpaid, an ad valorem tax on each one hundred dollars valuation of taxable property within the
City, at a rate sufficient, within the limit prescribed by law, to pay the debt service requirements
of the Bonds, being (i) the interest on the Bonds, and (ii) a sinking fund for their redemption at
maturity or a sinking fund of two percent (2%) per annum (whichever amount is greater), when
due and payable, full allowance being made for delinquencies and costs of collection.
(b) The ad valorem tax thus levied shall be assessed and collected each year against
all property appearing on the tax rolls of the City most recently approved in accordance with law
and the money thus collected shall be deposited as collected to the Interest and Sinking Fund.
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(c) Said ad valorem tax, the collections therefrom, and all amounts on deposit in or
required hereby to be deposited to the Interest and Sinking Fund are hereby pledged and
committed irrevocably to the payment of the principal of and interest on the Bonds when and as
due and payable in accordance with their terms and this Ordinance.
(d) To the extent the City has available funds which may be lawfully used to pay debt
service on the Bonds and such funds are on deposit in the Interest and Sinking Fund in advance
of the time when the City Council of the City is scheduled to set a tax rate for any year, then such
tax rate which would otherwise be required to be established pursuant to subsection (a) of this
Section may be reduced to the extent and by the amount of such funds in the Interest and Sinking
Fund.
(e) If the lien and provisions of this Ordinance shall be released in a manner
permitted by Article XI hereof, then the collection of such ad valorem tax may be suspended or
appropriately reduced, as the facts may permit, and further deposits to the Interest and Sinking
Fund may be suspended or appropriately reduced, as the facts may permit. In determining the
aggregate principal amount of outstanding Bonds, there shall be subtracted the amount of any
Bonds that have been duly called for redemption and for which money has been deposited with
the Paying Agent/Registrar for such redemption.
Section 2.02. Interest and Sinking Fund.
(a) The City hereby establishes a special fund or account, to be designated the "City
of Grapevine, Texas, General Obligation Refunding Bonds, Series 2006, Interest and Sinking
Fund," said fund to be maintained at an official depository bank of the City separate and apart
from all other funds and accounts of the City.
(b) Money on deposit in or required by this Ordinance to be deposited to the Interest
and Sinking Fund shall be used solely for the purpose of paying the interest on and principal of
the Bonds when and as due and payable in accordance with their terms and this Ordinance.
ARTICLE III
AUTHORIZATION; GENERAL TERMS AND PROVISIONS
REGARDING THE BONDS
Section 3.01. Authorization.
The City's bonds, to be designated "City of Grapevine, Texas, General Obligation
Refunding Bonds, Series 2006," are hereby authorized to be issued and delivered in accordance
with the Constitution and laws of the State of Texas, including particularly Chapter 1207, Texas
Government Code. The Bonds shall be issued in one series, as set forth in the Pricing
Certificate, and shall be issued in the original aggregate principal amount of not to exceed
$7,500,000 for the purpose of providing funds to refund the Refunded Obligations, to the extent
provided in the Pricing Certificate and paying the costs and expenses of issuing the Bonds.
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Section 3.02. Date, Denomination, Maturities and Interest.
(a) The Bonds shall be dated the date set forth in the Pricing Certificate. The Bonds
shall be in fully registered form, without coupons, in the denomination of$5,000 or any integral
multiple thereof, and shall be numbered separately from one (1) upward, except the Initial Bond,
which shall be numbered T-1.
(b) The Bonds shall mature on August 15 in the years and in the principal amounts
set forth in the Pricing Certificate. The Bonds shall mature and become payable not later than
August 15, 2019.
(c) Interest shall accrue and be paid on each Bond respectively until its maturity or
prior redemption, from the later of the Bond Date or the most recent Interest Payment Date to
which interest has been paid or provided for at the rates per annum for each respective maturity
specified in the Pricing Certificate as provided in Section 7.01 below. Such interest shall be
payable semiannually on each Interest Payment Date. Interest on the Bonds shall be calculated
on the basis of a three hundred sixty (360) day year composed of twelve (12) months of thirty
(30) days each.
Section 3.03. Medium, Method and Place of Payment.
(a) The principal of, premium, if any, and interest on the Bonds shall be paid in
lawful money of the United States of America.
(b) Interest on the Bonds shall be payable to each Owner as shown in the Register at
the close of business on the Record Date; provided, however, in the event of nonpayment of
interest on a scheduled Interest Payment Date and for 30 days thereafter, a new record date for
such interest payment (a "Special Record Date") shall be established by the Paying
Agent/Registrar, if and when funds for the payment of such interest have been received from the
City. Notice of the Special Record Date and of the scheduled payment date of the past due
interest (the "Special Payment Date," which shall be 15 days after the Special Record Date) shall
be sent at least five Business Days prior to the Special Record Date by United States mail, first
class, postage prepaid, to the address of each Owner of a Bond appearing on the Register at the
close of business on the last Business Day next preceding the date of mailing of such notice.
(c) Interest shall be paid by check, dated as of the Interest Payment Date, and sent by
the Paying Agent/Registrar to each Owner, first class United States mail, postage prepaid, to the
address of each Owner as it appears in the Register, or by such other customary banking
arrangement acceptable to the Paying Agent/Registrar and the Owner; provided, however, the
Owner shall bear all risk and expense of such other banking arrangement. At the option of an
Owner of at least $1,000,000 principal amount of the Bonds, interest may be paid by wire
transfer to the bank account of such Owner on file with the Paying Agent/Registrar.
(d) The principal of each Bond shall be paid to the Owner thereof on the due date
(whether at the maturity date or the date of prior redemption thereof) upon presentation and
surrender of such Bond at the Designated Payment/Transfer Office of the Paying
Agent/Registrar.
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(e) If the date for the payment of the principal of or interest on the Bonds shall be a
Saturday, Sunday, legal holiday, or day on which banking institutions in the city where the
Designated Payment/Transfer Office of the Paying Agent/Registrar is located are required or
authorized by law or executive order to close, the date for such payment shall be the next
succeeding day which is not a Saturday, Sunday, legal holiday, or day on which banking
institutions are required or authorized to close, and payment on such date shall have the same
force and effect as if made on the original date payment was due and no additional interest shall
be due by reason of nonpayment on the date on which such payment is otherwise stated to be due
and payable.
(f) Unclaimed Payments shall be segregated in a special account and held in trust,
uninvested by the Paying Agent/Registrar, for the account of the Owner of the Bonds to which
the Unclaimed Payments pertain. Subject to Title 6 of the Texas Property Code, Unclaimed
Payments remaining unclaimed by the Owners entitled thereto for three (3) years after the
applicable payment or redemption date shall be applied to the next payment or payments on the
Bonds thereafter coming due and, to the extent any such money remains after the retirement of
all outstanding Bonds, shall be paid to the City to be used for any lawful purpose. Thereafter,
neither the City, the Paying Agent/Registrar nor any other person shall be liable or responsible to
any holders of such Bonds for any further payment of such unclaimed monies or on account of
any such Bonds, subject to Title 6 of the Texas Property Code.
Section 3.04. Execution and Registration of Bonds.
(a) The Bonds shall be executed on behalf of the City by the Mayor and the City
Secretary, by their manual 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 those
officers, and such facsimile seal on the Bonds shall have the same effect as if the official seal of
the City had been manually impressed upon each of the Bonds.
(b) In the event that any officer of the City whose manual or facsimile signature
appears on the Bonds ceases to be such officer before the authentication of such Bonds or before
the delivery thereof, such manual or facsimile signature nevertheless shall 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
Certificate of Paying Agent/Registrar substantially in the form provided herein, duly
authenticated by manual execution by an officer or duly authorized signatory of the Paying
Agent/Registrar. It shall not be required that the same officer or authorized signatory of the
Paying Agent/Registrar sign the Certificate of Paying Agent/Registrar on all of the Bonds. In
lieu of the executed Certificate of Paying Agent/Registrar described above, the Initial Bond
delivered at the Closing Date shall have attached thereto the Comptroller's Registration
Certificate substantially in the form provided herein, manually executed by the Comptroller of
Public Accounts of the State of Texas, or by his duly authorized agent, which Certificate shall be
evidence that the Bond has been duly approved by the Attorney General of the State of Texas
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and that it is a valid and binding obligation of the City, and has been registered by the
Comptroller of Public Accounts of the State of Texas.
(d) On the Closing Date, one initial Bond representing the entire principal amount of
all Bonds, payable in stated installments to the initial purchaser, or its designee, executed by the
Mayor and City Secretary of the City by their manual or facsimile signatures, approved by the
Attorney General, and registered and manually signed by the Comptroller of Public Accounts,
will be delivered to the initial purchaser or its designee. Upon payment for the Initial Bond, the
Paying Agent/Registrar shall cancel the Initial Bond and deliver to DTC, on behalf of the initial
Purchaser, one typewritten Bond for each maturity representing the aggregate principal amount
for each respective maturity, registered in the name of Cede & Co., as nominee for DTC.
Section 3.05. Ownership.
(a) The City, the Paying Agent/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 as provided herein (except interest shall be paid to the person in
whose name such Bond is registered on the Record Date), and for all other purposes, whether or
not such Bond is overdue, and neither the City nor the Paying Agent/Registrar shall be bound by
any notice or knowledge to the contrary.
(b) All payments made to the Owner of a Bond shall be valid and effectual and shall
discharge the liability of the City and the Paying Agent/Registrar upon such Bond to the extent
of the sums paid.
Section 3.06. Registration, Transfer and Exchange.
(a) So long as any Bonds remain outstanding, the City shall cause the Paying
Agent/Registrar to keep at the Designated Payment/Transfer Office a register in which, subject to
such reasonable regulations as it may prescribe, the Paying Agent/Registrar shall provide for the
registration and transfer of Bonds in accordance with this Ordinance.
(b) The ownership of a Bond may be transferred only upon the presentation and
surrender of the Bond at the Designated Payment/Transfer Office of the Paying Agent/Registrar
with such endorsement or other evidence of transfer as is acceptable to the Paying
Agent/Registrar. No transfer of any Bond shall be effective until entered in the Register.
(c) The Bonds shall be exchangeable upon the presentation and surrender thereof at
the Designated Payment/Transfer Office of the Paying Agent/Registrar for a Bond or Bonds of
the same maturity and interest rate and in any denomination or denominations of any integral
multiple of$5,000 and in an aggregate principal amount equal to the unpaid principal amount of
the Bonds presented for exchange. The Paying Agent/Registrar is hereby authorized to
authenticate and deliver Bonds exchanged for other Bonds in accordance with this Section.
(d) Each exchange Bond delivered by the Paying Agent/Registrar in accordance with
this Section shall constitute an original contractual obligation of the City and 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 exchange Bond is delivered.
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(e) No service charge shall be made to the Owner for the initial registration,
subsequent transfer, or exchange for any different denomination of any of the Bonds. The
Paying Agent/Registrar, however, may require the Owner to pay a sum sufficient to cover any
tax or other governmental charge that is authorized to be imposed in connection with the
registration, transfer or exchange of a Bond.
(f) Neither the City nor the Paying Agent/Registrar shall be required to issue,
transfer, or exchange any Bond called for redemption, in whole or in part, where such
redemption is scheduled to occur within forty-five (45) calendar days after the transfer or
exchange date; provided, however, such limitation shall not be applicable to an exchange by the
Owner of the uncalled principal balance of a Bond.
Section 3.07. Cancellation.
All Bonds paid or redeemed before scheduled maturity in accordance with this
Ordinance, and all Bonds in lieu of which exchange Bonds or replacement Bonds are
authenticated and delivered in accordance with this Ordinance, shall be cancelled and proper
records shall be made regarding such payment, redemption, exchange or replacement. The
Paying Agent/Registrar shall then return such cancelled Bonds to the City or may in accordance
with law destroy such cancelled Bonds and periodically furnish the City with certificates of
destruction of such Bonds.
Section 3.08. Temporary Bonds.
(a) Following the delivery and registration of the Initial Bond and pending the
preparation of definitive Bonds, the proper officers of the City may execute and, upon the City's
request, the Paying Agent/Registrar shall authenticate and deliver, one or more temporary Bonds
that are printed, lithographed, typewritten, mimeographed or otherwise produced, in any
denomination, substantially of the tenor of the definitive Bonds in lieu of which they are
delivered, without coupons, and with such appropriate insertions, omissions, substitutions and
other variations as the officers of the City executing such temporary Bonds may determine, as
evidenced by their signing of such temporary Bonds.
(b) Until exchanged for Bonds in definitive form, such Bonds in temporary form shall
be entitled to the benefit and security of this Ordinance.
(c) The City, without unreasonable delay, shall prepare, execute and deliver to the
Paying Agent/Registrar the Bonds in definitive form; thereupon, upon the presentation and
surrender of the Bonds in temporary form to the Paying Agent/Registrar, the Paying
Agent/Registrar shall cancel the Bonds in temporary form and shall authenticate and deliver in
exchange therefor Bonds of the same maturity and series, in definitive form, in the authorized
denomination, and in the same aggregate principal amount, as the Bonds in temporary form
surrendered. Such exchange shall be made without the making of any charge therefor to any
Owner.
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Section 3.09. Replacement Bonds.
(a) Upon the presentation and surrender to the Paying Agent/Registrar of a mutilated
Bond, the Paying Agent/Registrar shall authenticate and deliver in exchange therefor a
replacement Bond of like tenor and principal amount, bearing a number not contemporaneously
outstanding. The City or the Paying Agent/Registrar may require the Owner of such Bond to pay
a sum sufficient to cover any tax or other governmental charge that is authorized to be imposed
in connection therewith and any other expenses connected therewith.
(b) In the event that any Bond is lost, apparently destroyed or wrongfully taken, the
Paying Agent/Registrar, 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
authenticate and deliver a replacement Bond of like tenor and principal amount, bearing a
number not contemporaneously outstanding, provided that the Owner first:
(i) furnishes to the Paying Agent/Registrar satisfactory evidence of his
ownership of and the circumstances of the loss, destruction or theft of such Bond;
(ii) furnishes such security or indemnity as may be required by the Paying
Agent/Registrar to save it and the City harmless;
(iii) pays 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 is authorized to be imposed; and
(iv) satisfies any other reasonable requirements imposed by the City and the
Paying Agent/Registrar.
(c) 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 Paying Agent/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
Paying Agent/Registrar in connection therewith.
(d) In the event that any such mutilated, lost, apparently destroyed or wrongfully
taken Bond has become or is about to become due and payable, the Paying Agent/Registrar, in its
discretion, instead of issuing a replacement Bond, may pay such Bond if it has become due and
payable or may pay such Bond when it becomes due and payable.
(e) Each replacement Bond delivered in accordance with this Section shall constitute
an original additional contractual obligation of the City and 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.
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Section 3.10. Book-Entry Only System.
(a) Notwithstanding any other provision hereof, upon initial issuance of the Bonds,
the ownership of the Bonds shall be registered in the name of Cede& Co., as nominee of DTC.
The definitive Bonds shall be initially issued in the form of a single separate fully registered
certificate for each of the maturities thereof.
(b) With respect to Bonds registered in the name of Cede& Co., as nominee of DTC,
the City and the Paying Agent/ Registrar shall have no responsibility or obligation to any DTC
Participant or to any person on behalf of whom such a DTC Participant holds an interest in the
Bonds. Without limiting the immediately preceding sentence, the City and the Paying
Agent/Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the
records of DTC, 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 a Bondholder,
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 a
Bondholder, as shown in 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 Paying Agent/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, premium, if any, and interest on such Bonds,
for the purpose of all matters with respect to such Bond, for the purpose of registering transfer
with respect to such Bond, and for all other purposes whatsoever. The Paying Agent/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 payment of, 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 certificate evidencing the obligation of the City to make
payments of amounts due pursuant to this Ordinance. Upon delivery by DTC to the Paying
Agent/Registrar of written notice to the effect that DTC has determined to substitute a new
nominee in place of Cede& Co., the word "Cede & Co." in this Ordinance shall refer to such
new nominee of DTC.
Section 3.11. Successor Securities Depository; Transfer Outside Book-Entry Only
System.
In the event that the City or the Paying Agent/Registrar determines that DTC is incapable
of discharging its responsibilities described herein and in the Representations Letter of the City
to DTC, or in the event DTC discontinues the services described herein, the City or the Paying
Agent/Registrar 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 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
of the availability through DTC of Bonds and transfer one or more separate Bonds to DTC
Participants having Bonds credited to their DTC accounts. 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
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DTC, but may be registered in the name of the successor securities depository, or its nominee, or
in whatever name or names Bondholders transferring or exchanging Bonds shall designate, in
accordance with the provisions of this Ordinance.
Section 3.12. 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
representation of the City to DTC.
ARTICLE IV
REDEMPTION OF BONDS BEFORE MATURITY
Section 4.01. Limitation on Redemption.
The Bonds shall be subject to redemption before scheduled maturity only as provided in
this Article IV.
Section 4.02. Optional Redemption.
(a) The City reserves the option to redeem Bonds in the manner provided in the Form
of Bond set forth in Section 6.02 of this Ordinance with such changes as are required by the
Pricing Certificate.
(b) The City, at least forty-five (45) days before the redemption date, unless a shorter
period shall be satisfactory to the Paying Agent/Registrar, shall notify the Paying
Agent/Registrar of such redemption date and of the principal amount of Bonds to be redeemed.
Section 4.03. Mandatory Sinking Fund Redemption.
(a) Bonds designated as "Term Bonds" in the Pricing Certificate, if any, are subject
to scheduled mandatory redemption and will be redeemed by the City, in part at a price equal to
the principal amount thereof, without premium, plus accrued interest to the redemption date, out
of moneys available for such purpose in the Interest and Sinking Fund, on the dates and in the
respective principal amounts as set forth in the Pricing Certificate.
(b) At least forty-five (45) days prior to each scheduled mandatory redemption date,
the Paying Agent/Registrar shall select for redemption by lot, or by any other customary method
that results in a random selection, a principal amount of Term Bonds equal to the aggregate
principal amount of such Term Bonds to be redeemed, shall call such Term Bonds for
redemption on such scheduled mandatory redemption date, and shall give notice of such
redemption, as provided in Section 4.05.
(c) In lieu of calling the Term Bonds described in subsection (a), above, for
mandatory redemption, the City reserves the right to purchase such Term Bonds at a price not
exceeding the principal amount thereof, plus accrued interest, with (i) moneys on deposit in the
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Interest and Sinking Fund which are available for the mandatory redemption of such Term Bonds
or(ii) other lawfully available funds.
(d) Upon any such purchase in lieu of redemption, not less than forty five (45) days
prior to a mandatory redemption date, the City shall deliver such Term Bonds to the Paying
Agent/Registrar prior to the selection of the Term Bonds for redemption and the principal
amount so delivered shall be credited against the amount required to be called for redemption in
that year.
(e) To the extent that the Term Bonds have been previously redeemed other than
from such scheduled mandatory redemption payments, the amount of each scheduled mandatory
redemption payment set forth above shall be reduced, as nearly as practicable, on a pro rata
basis.
Section 4.04. Partial Redemption.
(a) If less than all of the Bonds are to be redeemed pursuant to Section 4.02 hereof,
the City shall determine the maturity or maturities and the amounts thereof to be redeemed and
shall direct the Paying Agent/Registrar to call by lot the Bonds, or portions thereof, within such
maturity or maturities and in such principal amounts for redemption.
(b) A portion of a single Bond of a denomination greater than $5,000 may be
redeemed, but only in a principal amount equal to $5,000 or any integral multiple thereof. If
such a Bond is to be partially redeemed, the Paying Agent/Registrar shall treat each $5,000
portion of the Bond as though it were a single Bond for purposes of selection for redemption.
(c) Upon surrender of any Bond for redemption in part, the Paying Agent/Registrar,
in accordance with Section 3.06 of this Ordinance, shall authenticate and deliver an exchange
Bond or Bonds in an aggregate principal amount equal to the unredeemed portion of the Bond so
surrendered, such exchange being without charge.
(d) The Paying Agent/Registrar shall promptly notify the City in writing of the
principal amount to be redeemed of any Bond as to which only a portion thereof is to be
redeemed.
Section 4.05. Notice of Redemption to Owners.
(a) The Paying Agent/Registrar shall give notice of any redemption of Bonds by
sending notice by first class United States mail, postage prepaid, not less than thirty (30) days
before the date fixed for redemption, to the Owner of each Bond (or part thereof) to be
redeemed, at the address shown on the Register at the close of business on the business day next
preceding the date of mailing such notice.
(b) The notice shall state the redemption date, the redemption price, the place at
which the Bonds are to be surrendered for payment, and, if less than all the Bonds outstanding
are to be redeemed, an identification of the Bonds or portions thereof to be redeemed.
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(c) 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.
Section 4.06. Payment Upon Redemption.
(a) Before or on each redemption date, the City shall deposit with the Paying
Agent/Registrar money sufficient to pay all amounts due on the redemption date and the Paying
Agent/Registrar shall make provision for the payment of the Bonds to be redeemed on such date
by setting aside and holding in trust such amounts as are received by the Paying Agent/Registrar
from the City and shall use such funds solely for the purpose of paying the principal of,
redemption premium, if any, and accrued interest on the Bonds being redeemed.
(b) Upon presentation and surrender of any Bond called for redemption at the
Designated Payment/Transfer Office of the Paying Agent/Registrar on or after the date fixed for
redemption, the Paying Agent/Registrar shall pay the principal of, redemption premium, if any,
and accrued interest on such Bond to the date of redemption from the money set aside for such
purpose.
Section 4.07. Effect of Redemption.
(a) Notice of redemption having been given as provided in Section 4.05 of this
Ordinance, the Bonds or portions thereof called for redemption shall become due and payable on
the date fixed for redemption and, unless the City defaults in its obligation to make provision for
the payment of the principal thereof, redemption premium, if any, or accrued interest thereon,
such Bonds or portions thereof shall cease to bear interest from and after the date fixed for
redemption, whether or not such Bonds are presented and surrendered for payment on such date.
(b) If the City shall fail to make provision for payment of all sums due on a
redemption date, then any Bond or portion thereof called for redemption shall continue to bear
interest at the rate stated on the Bond until due provision is made for the payment of same by the
City.
ARTICLE V
PAYING AGENT/REGISTRAR
Section 5.01. Appointment of Initial Paying Agent/Registrar.
The Bank of New York Trust Company, National Association, Dallas, Texas, is hereby
appointed as the initial Paying Agent/Registrar for the Bonds.
Section 5.02. Qualifications.
Each Paying Agent/Registrar shall be a commercial bank, a trust company organized
under the laws of the State of Texas, or any other entity duly qualified and legally authorized to
serve as and perform the duties and services of paying agent and registrar for the Bonds.
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Section 5.03. Maintaining Paving Agent/Registrar.
(a) At all times while any Bonds are outstanding, the City will maintain a Paying
Agent/Registrar that is qualified under Section 5.02 of this Ordinance. The Mayor is hereby
authorized and directed to execute an agreement with the Paying Agent/Registrar specifying the
duties and responsibilities of the City and the Paying Agent/Registrar. The signature of the
Mayor shall be attested by the City Secretary of the City.
(b) If the Paying Agent/Registrar resigns or otherwise ceases to serve as such, the
City will promptly appoint a replacement.
Section 5.04. Termination.
The City, upon not less than sixty (60) days notice, reserves the right to terminate the
appointment of any Paying Agent/ Registrar by delivering to the entity whose appointment is to
be terminated written notice of such termination.
Section 5.05. Notice of Change to Owners.
Promptly upon each change in the entity serving as Paying Agent/Registrar, the City will
cause notice of the change to be sent to each Owner by first class United States mail, postage
prepaid, at the address in the Register, stating the effective date of the change and the name and
mailing address of the replacement Paying Agent/Registrar.
Section 5.06. Agreement to Perform Duties and Functions.
By accepting the appointment as Paying Agent/Registrar and executing the Paying
Agent/Registrar Agreement, the Paying Agent/Registrar is deemed to have agreed to the
provisions of this Ordinance and that it will perform the duties and functions of Paying
Agent/Registrar prescribed thereby.
Section 5.07. Delivery of Records to Successor.
If a Paying Agent/Registrar is replaced, such Paying Agent/Registrar, promptly upon the
appointment of the successor, will deliver the Register(or a copy thereof) and all other pertinent
books and records relating to the Bonds to the successor Paying Agent/Registrar.
ARTICLE VI
FORM OF THE BONDS
Section 6.01. Form Generally.
(a) The Bonds, the Registration Certificate of the Comptroller of Public Accounts of
the State of Texas, the Certificate of the Paying Agent/Registrar, and the Assignment form to
appear on each of the Bonds, (i) shall be substantially in the form set forth in this Article, with
such appropriate insertions, omissions, substitutions, and other variations as are permitted or
required by this Ordinance, and (ii) may have such letters, numbers, or other marks of
identification (including identifying numbers and letters of the Committee on Uniform Securities
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Identification Procedures of the American Bankers Association) and such legends and
endorsements (including any reproduction of an opinion of counsel) thereon as, consistently
herewith, may be determined by the City or by the officers executing such Bonds, as evidenced
by their execution thereof.
(b) Any portion of the text of any Bonds may be set forth on the reverse side thereof,
with an appropriate reference thereto on the face of the Bonds.
(c) The definitive Bonds shall be typewritten, printed, lithographed, or engraved, and
maybe produced by any combination of these methods or produced in any other similar manner,
all as determined by the officers executing such Bonds, as evidenced by their execution thereof.
(d) The Initial Bond submitted to the Attorney General of the State of Texas may be
typewritten and photocopied or otherwise reproduced.
Section 6.02. Form of the Bonds.
The form of the Bond, including the form of the Registration Certificate of the
Comptroller of Public Accounts of the State of Texas, the form of Certificate of the Paying
Agent/Registrar and the form of Assignment appearing on the Bonds, shall be substantially as
follows:
(a) Form of Bond.
REGISTERED REGISTERED
No. $
United States of America
State of Texas
County of Dallas
CITY OF GRAPEVINE, TEXAS
GENERAL OBLIGATION REFUNDING BOND
SERIES 2006'
INTEREST RATE: MATURITY DATE: BOND DATE: CUSIP NUMBER:
August 15, , 20062
The City of Grapevine, Texas (the "City"), in the County of Dallas, State of Texas, for
value received, hereby promises to pay to
' Complete title to be designated in Pricing Certificate.
2 Insert based upon the Pricing Certificate.
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or registered assigns, on the Maturity Date specified above, the sum of
DOLLARS
unless this Bond shall have been sooner called for redemption and the payment of the principal
hereof shall have been paid or provided for, and to pay interest on such principal amount from
the later of the Bond Date specified above or the most recent interest payment date to which
interest has been paid or provided for until payment of such principal amount has been paid or
provided for, at the per annum rate of interest specified above, computed on the basis of a three
hundred sixty (360) day year of twelve (12) thirty (30) day months, such interest to be paid
semiannually on August 15 and February 15 of each year, commencing
The principal of this Bond shall be payable without exchange or collection charges in
lawful money of the United States of America upon presentation and surrender of this Bond at
the corporate trust office in Dallas, Texas (the "Designated Payment/Transfer Office") of The
Bank of New York Trust Company, National Association, Dallas, Texas, as Paying
Agent/Registrar or, with respect to a successor Paying Agent/Registrar, at the Designated
Payment/Transfer Office thereof. Interest on this Bond is payable by check dated as of the
interest payment date, and will be mailed by the Paying Agent/Registrar to the registered owner
at the address shown on the registration books kept by the Paying Agent/Registrar or by such
other customary banking arrangement acceptable to the Paying Agent/Registrar and the
registered owner; provided, however, such registered owner shall bear all risk and expense of
such other banking arrangement. At the option of an Owner of at least $1,000,000 principal
amount of the Bonds, interest may be paid by wire transfer to the bank account of such Owner on
file with the Paying Agent/Registrar. For the purpose of the payment of interest on this Bond,
the registered owner shall be the person in whose name this Bond is registered at the close of
business on the "Record Date," which shall be the last business day of the month next preceding
such interest payment date.
If the date for the payment of the principal of or interest on this Bond shall be a Saturday,
Sunday, legal holiday, or day on which banking institutions in the city where the Paying
Agent/Registrar is located are required or authorized by law or executive order to close, the date
for such payment shall be the next succeeding day which is not a Saturday, Sunday, legal
holiday, or day on which banking institutions are required or authorized to close, and payment on
such date shall have the same force and effect as if made on the original date payment was due
and no additional interest shall be due by reason of nonpayment on the date on which such
payment is otherwise stated to be due and payable.
This Bond is dated , 20064 and is one of a series of fully registered bonds
specified in the title hereof issued in the aggregate principal amount of$ 5 (herein
referred to as the "Bonds"), issued pursuant to a certain ordinance of the City (the "Ordinance")
for the purpose of providing funds with which to refund in advance of their maturity certain
outstanding obligations of the City, and to pay the costs of issuing the Bonds.
3 Insert based upon the Pricing Certificate.
4 Insert based upon the Pricing Certificate.
5 Insert based upon the Pricing Certificate.
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[The City has reserved the option to redeem the Bonds maturing on or after August 15,
, in whole or in part before their respective scheduled maturity dates, on August 15,
or on any date thereafter, at a price equal to the principal amount of the Bonds so called for
redemption plus accrued interest to the date fixed for redemption. If less than all of the Bonds
are to be redeemed, the City shall determine the maturity or maturities and the amounts thereof
to be redeemed and shall direct the Paying Agent/Registrar to call by lot the Bonds, or portions
thereof, within such maturity and in such principal amounts, for redemption.]6
[The Bonds stated to mature on August 15, 20� are subject to scheduled mandatory
redemption by the Paying Agent/Registrar by lot, or by any other customary method that results
in a random selection, at a price equal to the principal amount thereof, without premium, plus
accrued interest to the redemption date, on the dates and in the respective principal amounts as
follows:
Principal
Redemption Date Amount
August 15, 20 $
August 15, 20_
August 15, 20 (maturity)
In lieu of such mandatory redemptions the District has reserved the right to purchase the
Term Bonds maturing August 15, 20 at a price not exceeding the principal amount thereof,
plus accrued interest, out of (i) moneys available for such purpose in the Interest and Sinking
Fund or (ii) other lawfully available funds. The principal amount of Term Bonds maturing
August 15, 20 , so purchased shall reduce the principal amount of Term Bonds maturing
August 15, 20 , required for mandatory redemption in such year. To the extent that the Term
Bonds maturing August 15, 20_have been previously redeemed other than from such scheduled
mandatory redemption payments, the amount of each scheduled mandatory redemption payment
set forth above shall be reduced, as nearly as practicable, on a pro rata basis.]
Notice of such redemption or redemptions shall be given by first class mail, postage
prepaid, not less than thirty (30) days before the date fixed for redemption, to the registered
owner of each of the Bonds to be redeemed in whole or in part. Notice having been so given, the
Bonds or portions thereof designated for redemption shall become due and payable on the
redemption date specified in such notice; from and after such date, notwithstanding that any of
the Bonds or portions thereof so called for redemption shall not have been surrendered for
payment, interest on such Bonds or portions thereof shall cease to accrue.
As provided in the Ordinance, and subject to certain limitations therein set forth, this
Bond is transferable upon surrender of this Bond for transfer at the Designated Payment/Transfer
Office of the Paying Agent/Registrar with such endorsement or other evidence of transfer as is
acceptable to the Paying Agent/Registrar; thereupon, one or more new fully registered Bonds of
6 Insert optional redemption provisions and revise as necessary to conform to the Pricing Certificate.
7 Insert mandatory sinking fund redemption provisions for the Bonds,if any,and revise as necessary to conform to
the Pricing Certificate.
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the same stated maturity, of authorized denominations, bearing the same rate of interest, and for
the same aggregate principal amount will be issued to the designated transferee or transferees.
Neither the City nor the Paying Agent/Registrar shall be required to issue, transfer or
exchange any Bond called for redemption where such redemption is scheduled to occur within
forty-five(45) calendar days of the transfer or exchange date; provided, however, such limitation
shall not be applicable to an exchange by the registered owner of the uncalled principal balance
of a Bond.
The City, the Paying Agent/Registrar, and any other person may treat the person in whose
name this Bond is registered as the owner hereof for the purpose of receiving payment as herein
provided (except interest shall be paid to the person in whose name this Bond is registered on the
Record Date) and for all other purposes, whether or not this Bond be overdue, and neither the
City nor the Paying Agent/Registrar shall be affected by notice to the contrary.
IT IS HEREBY CERTIFIED AND RECITED that the issuance of this Bond and the
series of which it is a part is duly authorized by law, and has been authorized by a vote of the
properly qualified electors of the City; that all acts, conditions and things required to be done
precedent to and in the issuance of the Bonds have been properly done and performed and have
happened in regular and due time, form and manner, as required by law; and that ad valorem
taxes upon all taxable property in the City have been levied for and pledged to the payment of
the debt service requirements of the Bonds, within the limit prescribed by law.
IN WITNESS WHEREOF, the City has caused this Bond to be executed by the manual
or facsimile signature of the Mayor of the City and countersigned by the manual or facsimile
signature of the City Secretary of the City, and the official seal of the City has been duly
impressed or placed in facsimile on this Bond.
City Secretary, Mayor,
City of Grapevine, Texas City of Grapevine, Texas
(SEAL)
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Dallas 1173258v.3
(b) Form of Comptroller's Registration Certificate.
The following Comptroller's Registration Certificate may be deleted from the definitive
Bonds if such certificate on the Initial Bond is fully executed.
OFFICE OF THE COMPTROLLER §
OF PUBLIC ACCOUNTS § REGISTER NO.
OF THE STATE OF TEXAS §
I hereby certify that there is on file and of record in my office a certificate of the Attorney
General of the State of Texas to the effect that this Bond has been examined by him as required
by law, that he finds that it has been issued in conformity with the Constitution and laws of the
State of Texas, and that it is a valid and binding obligation of the City of Grapevine, Texas, and
that this Bond has this day been registered by me.
Witness my hand and seal of office at Austin, Texas,
Comptroller of Public Accounts
of the State of Texas
SEAL
(c) Form of Certificate of Paying Agent/Registrar.
The following Certificate of Paying Agent/Registrar may be deleted from the Initial Bond
if the Comptroller's Registration Certificate appears thereon.
CERTIFICATE OF PAYING AGENT/REGISTRAR
The records of the Paying Agent/Registrar show that the Initial Bond of this series of
bonds was approved by the Attorney General of the State of Texas and registered by the
Comptroller of Public Accounts of the State of Texas, and that this is one of the Bonds referred
to in the within-mentioned Ordinance.
THE BANK OF NEW YORK TRUST
COMPANY, NATIONAL ASSOCIATION
Dallas, Texas, as Paying Agent/Registrar
Dated: By:
Authorized Signatory
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(d) Form of Assignment.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto
(print or typewrite name, address and Zip Code of transferee):
(Social Security or other identifying number: ) the within Bond
and all rights hereunder and hereby irrevocably constitutes and appoints
attorney to transfer the within Bond on the books kept for registration hereof, with full power of
substitution in the premises.
Dated:
NOTICE: The signature on this Assignment
must correspond with the name of the
registered owner as it appears on the face of
the within Bond in every particular and must
be guaranteed in a manner acceptable to the
Paying Agent/Registrar.
Signature Guaranteed By:
Authorized Signatory
(e) Each Initial Bond shall be in the form set forth in paragraphs (a) through (d) of
this Section, except for the following alterations:
(i) immediately under the name of the Bond (which name shall be set forth in
the Pricing Certificate), the headings "INTEREST RATE" and "MATURITY DATE"
shall both be completed with the words "As shown below";
(ii) in the first paragraph of the Bond, the words "on the Maturity Date
specified above" shall be deleted and the following will be inserted: "on August 15 in
each of the years, in the principal installments and bearing interest at the per annum rates
in accordance with the following schedule:
Year Principal Amounts Interest Rate
(Information to be inserted from Pricing Certificate)
(iii) the Initial Bond or Bonds shall be numbered T-1 upward.
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Section 6.03. CUSIP Registration.
The City may secure identification numbers through the CUSIP Service Bureau Division
of Standard & Poor's Corporation, New York, New York, and may authorize the printing of such
numbers on the face of the Bonds. It is expressly provided, however, that the presence or
absence of CUSIP numbers on the Bonds shall be of no significance or effect as regards the
legality thereof and neither the City nor the attorneys approving said Bonds as to legality are to
be held responsible for CUSIP numbers incorrectly printed on the Bonds.
Section 6.04. Legal Opinion.
The approving legal opinion of Vinson & Elkins L.L.P., Bond Counsel, may be printed
on the reverse side of each Bond over the certification of the City Secretary of the City, which
may be executed in facsimile.
Section 6.05. Statement of Insurance.
A statement relating to a municipal bond insurance policy, if any, to be issued for the
Bonds may be printed on or attached to each Bond.
ARTICLE VII
SALE AND DELIVERY OF BONDS, DEPOSIT OF PROCEEDS
Section 7.01. Sale of Bonds, Official Statement.
(a) The Bonds shall be sold at private sale to the Underwriter in accordance with the
terms of this Ordinance, including this Section 7.01(a). As authorized by the Chapter 1207,
Texas Government Code, as amended, the City Manager (or, in his absence, the Administrative
Services Director) is authorized to act on behalf of the City upon determining that the conditions
set forth below can be satisfied, in selling and delivering the Bonds and carrying out the other
procedures specified in this Ordinance, including determining the price at which each of the
Bonds will be sold, the number of Bonds to be issued, the form in which the Bonds shall be
issued, the years in which the Bonds will mature, the principal amount to mature in each of such
years, the aggregate principal amount of Refunded Obligations and the aggregate principal
amount of the Bonds, the rate of interest to be borne by each such maturity, the first interest
payment date, 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 and shall be subject to mandatory sinking
fund redemption, and all other matters relating to the issuance, sale and delivery of the Bonds,
including the refunding of the Refunded Obligations, all of which shall be specified in the
Pricing Certificate;provided that the following conditions can be satisfied:
(i) the Bonds shall not bear interest at a rate greater than the maximum rate
allowed by Chapter 1204, Texas Government Code, as amended;
(ii) the aggregate principal amount of the Bonds authorized to be issued for
the purposes described in Section 3.01 shall not exceed the maximum amount authorized
in Section 3.01 hereof and shall equal an amount sufficient to provide for the refunding of
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the maximum amount of the Refunded Obligations to be selected from the Refunded
Obligation Candidates identified in Schedule I hereto that will:
A. result in a reduction of debt service costs to the City on a present
value basis of not less than 4.00% of the Refunded Obligations:
B. not require the refunding of any maturity of any series of Refunded
Obligations that would not produce an incremental reduction in debt service costs
to the City on a present value basis for such maturity of Refunded Obligations, a
term maturity being considered a single maturity for such purposes,
(iii) all such terms and determinations pertaining to the pricing of the Bonds
shall be based on bond market conditions and available interest rates for the Bonds on the
date of the sale of the Bonds, all as set forth in the Pricing Certificate. The Refunded
Obligations shall be identified in the Pricing Certificate in accordance with the preceding
sentence, except that if less than an entire maturity is to be refunded, the Refunded
Obligations to be refunded within a maturity shall be selected as provided in the
Ordinances authorizing their issuance and, if not so provided,by lot; and
The Mayor is hereby authorized and directed to execute and deliver, a bond purchase
contract (the "Purchase Contract") which Purchase Contract is hereby accepted, approved and
authorized in substantially the form submitted to the City and upon completion of the terms of
the Purchase Contract in accordance with the terms of the Pricing Certificate and this Ordinance,
the Mayor and other appropriate officials of the City are hereby authorized and directed to
execute such Purchase Contract on behalf of the City and the Mayor 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. The Bonds shall initially be registered in the name of Southwest Securities Inc. or its
designee.
The authority granted to the City Manager under this Section 7.01(a) shall expire on
December 31, 2006 unless otherwise extended by the City Council by separate action.
The Mayor is hereby authorized to enter into two Escrow Agreements with respect to (i)
those Obligations that are to be refunded within 90 days of the initial delivery of the Bonds, and
(ii) those Obligations that are to be refunded more than 90 days after the initial delivery of the
Bonds, if it is found to be in the best interests of the City to execute two Escrow Agreements.
(b) The form and substance of the Preliminary Official Statement for the Bonds and
any addenda, supplement or amendment thereto (the "Preliminary Official Statement") presented
to and considered at this meeting, are hereby in all respects approved. The Mayor and the City
Secretary are each authorized and directed to complete on behalf of the City and in their official
capacities, that Preliminary Official Statement, with such modifications, completions, changes
and supplements, as those officers shall approve or authorize for the purpose of preparing and
determining, and to certify or otherwise represent that the revised Preliminary Official Statement
is a"deemed final" official statement as of its date (except for the omission of pricing and related
information) within the meaning and for the purposes of paragraph (b)(1) of Rule 15c2-12 under
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the Securities Exchange Act of 1934, as amended. The use and distribution of the revised
Preliminary Official Statement in the public offering of the Bonds by the Underwriter is hereby
authorized. The Mayor and the City Secretary are hereby further authorized and directed to use
and distribute or authorize the use and distribution of, the final official statement and any
addenda, supplement or amendment thereto (the "Official Statement") and to execute the same
and deliver appropriate numbers of copies thereof to the Underwriter. The Official Statement as
thus approved executed and delivered, with such appropriate variations as shall be approved by
the Mayor, the City Manager or Administrative Services Director and the Underwriter, may be
used by the Underwriter in the public offering and sale thereof. The City Secretary is hereby
authorized and directed to include and maintain a copy of the Preliminary Official Statement and
the Official Statement and any addenda, supplement or amendment thereto thus approved among
the permanent records of this meeting.
(c) The Mayor, the City Manager and all other officers of the City are authorized to
take such actions, to obtain such consents or approvals and to execute such documents,
certificates and receipts as they may deem necessary and appropriate in order to consummate the
delivery of the Bonds, to pay the costs of issuance of the Bonds, and to effectuate the terms and
provisions of this Ordinance.
(d) The obligation of the Underwriter to accept delivery of the Bonds is subject to the
Underwriter being furnished with the final, approving opinion of Vinson& Elkins L.L.P., Bond
Counsel, which opinion shall be dated and delivered on the Closing Date.
Section 7.02. Control and Delivery of Bonds.
(a) The Mayor of the City is hereby authorized to have control of the Initial Bond and
all necessary records and proceedings pertaining thereto pending investigation, examination and
approval of the Attorney General of the State of Texas, registration by the Comptroller of Public
Accounts of the State of Texas and registration with, and initial exchange or transfer by, the
Paying Agent/Registrar. Further, in connection with the submission of the record of proceedings
for the Bonds to the Attorney General of the State of Texas for examination and approval of such
Bonds, the appropriate officer of the City is hereby authorized and directed to issue a check of
the City payable to the Attorney General of the State of Texas as a nonrefundable examination
fee in the amount required by Chapter 1202, Texas Government Code (such amount not to
exceed $9,500).
(b) After registration by the Comptroller of Public Accounts of the State of Texas,
delivery of the Bonds shall be made to the initial purchasers thereof under and subject to the
general supervision and direction of the Mayor, against receipt by the City of all amounts due to
the City under the terms of sale.
Section 7.03. Deposit of Proceeds.
(a) All amounts received on the Closing Date as accrued interest on the Bonds from
the Bond Date to the Closing Date shall be deposited to the Interest and Sinking Fund.
(b) A portion of the proceeds from the sale of the Bonds, together with other funds of
the City, if any, as set forth in the Pricing Certificate shall be applied to establish an escrow fund
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to refund the Refunded Obligations and, to the extent not otherwise provided for, to pay all
expenses arising in connection with the establishment of such escrow fund and the refunding of
the Refunded Obligations.
(c) The remaining balance received on the Closing Date shall be deposited as directed
by an authorized officer of the City, and shall be used to pay the cost of issuing the Bonds.
ARTICLE VIII
INVESTMENTS
Section 8.01. Investments.
(a) Money in the Interest and Sinking Fund created by this Ordinance, at the City's
option, may be invested in such securities or obligations as permitted under applicable law.
(b) Any securities or obligations in which money is so invested shall be kept and held
in trust for the benefit of the Owners and shall be sold and the proceeds of sale shall be timely
applied to the making of all payments required to be made from the fund from which the
investment was made.
Section 8.02. Investment Income.
(a) Interest and income derived from investment of the Interest and Sinking Fund
shall be credited to such Fund.
(b) Interest and income derived from the investment of the funds deposited pursuant
to Section 7.03(c) hereof shall be credited to the fund or account where deposited until the
construction of the projects for which the Bonds are issued is completed; thereafter, to the extent
such interest and income are present, such interest and income shall be deposited to the Interest
and Sinking Fund.
ARTICLE IX
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 9.01. Payment of the Bonds.
On or before each Interest Payment Date for the Bonds and while any of the Bonds are
outstanding and unpaid, there shall be made available to the Paying Agent/Registrar, out of the
Interest and Sinking Fund, money sufficient to pay such interest on and principal of the Bonds as
will accrue or mature on the applicable Interest Payment Date or date of prior redemption.
Section 9.02. Other Representations and Covenants.
(a) The City will faithfully perform at all times any and all covenants, undertakings,
stipulations, and provisions contained in this Ordinance and in each Bond; the City will promptly
pay or cause to be paid the principal of and interest on each Bond on the dates and at the places
and manner prescribed in such Bond; and the City will, at the times and in the manner prescribed
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by this Ordinance, deposit or cause to be deposited the amounts of money specified by this
Ordinance.
(b) The City is duly authorized under the laws of the State of Texas to issue the
Bonds; all action on its part for the creation and issuance of the Bonds has been duly and
effectively taken; and the Bonds in the hands of the Owners thereof are and will be valid and
enforceable obligations of the City in accordance with their terms.
Section 9.03. Provisions Concerning Federal Income Tax Exclusion.
The City intends that the interest on the Bonds shall be excludable from gross income for
purposes of federal income taxation pursuant to sections 103 and 141 through 150 of the Internal
Revenue Code of 1986, as amended (the "Code"), and the applicable regulations promulgated
thereunder (the "Regulations"). The City covenants and agrees not to take any action, or
knowingly omit to take any action within its control, that if taken or omitted, respectively, would
cause the interest on the Bonds to be includable in the gross income, as defined in section 61 of
the Code, of the holders thereof for purposes of federal income taxation. In particular, the City
covenants and agrees to comply with each requirement of this Article IX; provided, however,
that the City shall not be required to comply with any particular requirement of this Article IX if
the City has received an opinion of nationally recognized bond counsel ("Counsel's Opinion")
that such noncompliance will not adversely affect the exclusion from gross income for federal
income tax purposes of interest on the Bonds or if the City has received a Counsel's Opinion to
the effect that compliance with some other requirement set forth in this Article IX will satisfy the
applicable requirements of the Code, in which case compliance with such other requirement
specified in such Counsel's Opinion shall constitute compliance with the corresponding
requirement specified in this Article IX.
Section 9.04. No Private Use or Payment and No Private Loan Financing.
The City shall certify, through an authorized officer, employee or agent, that, based upon
all facts and estimates known or reasonably expected to be in existence on the date the Bonds are
delivered, the proceeds of the Bonds will not be used in a manner that would cause the Bonds to
be "private activity bonds" within the meaning of section 141 of the Code and the Regulations.
The City covenants and agrees that it will make such use of the proceeds of the Bonds, including
interest or other investment income derived from Bond proceeds, regulate the use of property
financed, directly or indirectly, with such proceeds, and take such other and further action as may
be required so that the bonds will not be "private activity bonds" within the meaning of section
141 of the Code and the Regulations.
Section 9.05. No Federal Guaranty.
The City covenants and agrees not to take any action, or knowingly omit to take any
action within its control, that, if taken or omitted, respectively, would cause the Bonds to be
"federally guaranteed" within the meaning of section 149(b) of the Code and the Regulations,
except as permitted by section 149(b)(3) of the Code and the Regulations.
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Section 9.06. Bonds are not Hedge Bonds.
The City covenants and agrees not to take any action, or knowingly omit to take any
action, and has not knowingly omitted and will not knowingly omit to take any action, within its
control, that, if taken or omitted, respectively, would cause the Bonds to be "hedge bonds"
within the meaning of section 149(g) of the Code and the Regulations.
Section 9.07. No-Arbitrage Covenant.
The City shall certify, through an authorized officer, employee or agent, that,based upon
all facts and estimates known or reasonably expected to be in existence on the date the Bonds are
delivered, the City will reasonably expect that the proceeds of the Bonds will not be used in a
manner that would cause the Bonds to be"arbitrage bonds"within the meaning of section 148(a)
of the Code and the Regulations. Moreover, the City covenants and agrees that it will make such
use of the proceeds of the Bonds including interest or other investment income derived from
Bond proceeds, regulate investments of proceeds of the Bonds, and take such other and further
action as may be required so that the Bonds will not be "arbitrage bonds" within the meaning of
section 148(a) of the Code and the Regulations.
Section 9.08. Arbitrage Rebate.
If the City does not qualify for an exception to the requirements of Section 148(f) of the
Code, 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 (within the meaning
of section 148(f)(6)(B) of the Code), be rebated to the federal government. Specifically, the City
will (i) maintain records regarding the investment of the gross proceeds of the Bonds as may be
required to calculate the amount earned on the investment of the gross proceeds of the Bonds
separately from records of amounts on deposit in the funds and accounts of the City allocable to
other bond issue of the City or moneys which do not represent gross proceeds of any bonds of
the City, (ii) calculate at such times as are required by the Regulations, the amount earned from
the investment of the gross proceeds of the Bonds which is required to be rebated to the federal
government, and (iii) pay, not less often than every fifth anniversary date of the delivery of the
Bonds or on such other dates as may be permitted under the Regulations, all amounts required to
be rebated to the federal government. 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 Bonds that might result in a reduction in the amount required
to be paid to the federal government because such arrangement 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 issue not been relevant to either party.
Section 9.09. Information Reporting.
The City covenants and agrees to file or cause to be filed with the Secretary of the
Treasury, not later than the 15th day of the second calendar month after the close of the calendar
quarter in which the Bonds are issued, an information statement concerning the Bonds, all under
and in accordance with section 149(e) of the Code and the Regulations.
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Section 9.10. Continuing Obligation.
Notwithstanding any other provision of this Ordinance, the City's obligations under the
covenants and provisions of this Article IX shall survive the defeasance and discharge of the
Bonds.
ARTICLE X
DEFAULT AND REMEDIES
Section 10.01. Events of Default.
Each of the following occurrences or events for the purpose of this Ordinance is hereby
declared to be an Event of Default:
(i) the failure to make payment of the principal of or interest on any of the
Bonds when the same becomes due and payable; or
(ii) default in the performance or observance of any other covenant,
agreement or obligation of the City, which default materially and adversely affects the
rights of the Owners, including but not limited to, their prospect or ability to be repaid in
accordance with this Ordinance, and the continuation thereof for a period of sixty (60)
days after notice of such default is given by any Owner to the City.
Section 10.02. Remedies for Default.
(a) Upon the happening of any Event of Default, then any Owner or an authorized
representative thereof, including but not limited to, a trustee or trustees therefor, may proceed
against the City for the purpose of protecting and enforcing the rights of the Owners under this
Ordinance, by mandamus or other suit, action or special proceeding in equity or at law, in any
court of competent jurisdiction, for any relief permitted by law, including the specific
performance of any covenant or agreement contained herein, or thereby to enjoin any act or thing
that may be unlawful or in violation of any right of the Owners hereunder or any combination of
such remedies.
(b) It is provided that all such proceedings shall be instituted and maintained for the
equal benefit of all Owners of Bonds then outstanding.
Section 10.03. Remedies Not Exclusive.
(a) No remedy herein conferred or reserved is intended to be exclusive of any other
available remedy or remedies, but each and every such remedy shall be cumulative and shall be
in addition to every other remedy given hereunder or under the Bonds or now or hereafter
existing at law or in equity; provided, however, that notwithstanding any other provision of this
Ordinance, the right to accelerate the debt evidenced by the Bonds shall not be available as a
remedy under this Ordinance.
(b) The exercise of any remedy herein conferred or reserved shall not be deemed a
waiver of any other available remedy.
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ARTICLE XI
DISCHARGE
Section 11.01. Discharge.
The Bonds may be defeased, discharged or refunded in any manner permitted by
applicable law.
ARTICLE XII
CONTINUING DISCLOSURE UNDERTAKING
Section 12.01. Annual Reports.
(a) The City shall provide annually to each NRMSIR and to any SID, within six (6)
months after the end of each fiscal year, financial information and operating data with respect to
the City of the general type included in the final Official Statement, being the information
described in Exhibit A hereto. Any financial statements so to be provided shall be (i) prepared in
accordance with the accounting principles described in Exhibit A hereto, and (ii) audited, if the
City commissions an audit of such statements and the audit is completed within the period during
which they must be provided. If the audit of such financial statements is not complete within
such period, then the City shall provide notice that audited financial statements are not available
and shall provide unaudited financial statements for the applicable fiscal year to each NRMSIR
and any SID. The City shall provide audited financial statements for the applicable fiscal year to
each NRMSIR and to any SID, when and if audited financial statements become available.
(b) If the City changes its fiscal year, it will notify each NRMSIR and any SID of the
change (and of 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.
(c) The financial information and operating data to be provided pursuant to this
Section may be set forth in full in one or more documents or may be included by specific
referenced to any document (including an official statement or other offering document, if it is
available from the MSRB) that theretofore has been provided to each NRMSIR and any SID or
filed with the SEC.
Section 12.02. Material Event Notices.
(a) The City shall notify any SID and either each NRMSIR or the MSRB, in a timely
manner, of any of the following events with respect to the Bonds, if such event is material within
the meaning of the federal securities laws:
(i) principal and interest payment delinquencies;
(ii) nonpayment related defaults;
(iii) unscheduled draws on debt service reserves reflecting financial
difficulties;
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(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 or events affecting the tax exempt status of the
Bonds;
(vii) modifications to rights of Owners;
(viii) bond calls;
(ix) defeasances;
(x) release, substitution, or sale of property securing repayment of the Bonds;
and
(xi) rating changes.
(b) The City shall notify any SID and either each NRMSIR or the MSRB, in a timely
manner, of any failure by the City to provide financial information or operating data in
accordance with Section 12.01 of this Ordinance by the time required by such Section.
Section 12.03. Limitations, Disclaimers and Amendments.
(a) The City shall be obligated to observe and perform the covenants specified in this
Article 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 Bond calls and any defeasances that cause the City to be no longer an "obligated
person."
(b) The provisions of this Article are for the sole benefit of the Owners and beneficial
owners of the Bonds, and nothing in this Article, express or implied, shall give any benefit or any
legal or equitable right, remedy, or claim hereunder to any other person. The City undertakes to
provide only the financial information, operating data, financial statements, and notices which it
has expressly agreed to provide pursuant to this Article and does not 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 Article 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 OWNER
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 ARTICLE, BUT EVERY RIGHT AND REMEDY OF
ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH
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BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC
PERFORMANCE.
(c) No default by the City in observing or performing its obligations under this
Article shall constitute a breach of or default under the Ordinance for purposes of any other
provisions of this Ordinance.
(d) Nothing in this Article is intended or shall act to disclaim, waive, or otherwise
limit the duties of the City under federal and state securities laws.
(e) The provisions of this Article 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, status, or type of operations of the City, but only if(i) the
provisions of this Article, as so amended, would have permitted an underwriter to purchase or
sell Bonds in the primary offering of the Bonds 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 (ii) either (A) the Owners of a majority in aggregate principal
amount (or any greater amount required by any other provisions of this Ordinance that authorizes
such an amendment) of the Outstanding Bonds consent to such amendment or (B) an entity or
individual person that is unaffiliated with the City (such as nationally recognized bond counsel)
determines that such amendment will not materially impair the interests of the Owners and
beneficial owners of the Bonds. If the City so amends the provisions of this Article, it shall
include with any amended financial information or operating data next provided in accordance
with Section 12.01 an explanation, in narrative form, of the reasons for the amendment and of
the impact of any change in type of financial information or operating data so provided.
ARTICLE XIII
REFUNDED OBLIGATIONS
Section 13.01. Payment of Paying Agency.
Prior to the Closing Date, the City shall ascertain from the paying agent for the Refunded
Obligations the amount of all future fees and expenses for its paying agency services with
respect to the Refunded Obligations. Concurrently with the sale and delivery of the Bonds, the
City shall cause an amount sufficient to pay such future fees and expenses to be paid to each
such paying agent.
Section 13.02. Escrow Agreement.
The discharge and defeasance of the Refunded Obligations shall be effectuated pursuant
to the terms and provisions of one or more Escrow Agreements (the "Escrow Agreement") to be
entered into by and between the City and the Escrow Agent, which shall be substantially in the
form attached hereto as Exhibit B, the terms and provisions of which are hereby approved,
subject to such insertions, additions and modifications as shall be necessary (a) to carry out the
program designed for the City and which shall be certified as to mathematical accuracy and
sufficiency by Grant Thornton LLP, certified public accountants, (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 Obligations, (d) to carry out the other intents and purposes of this Ordinance and
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(e) to comply with the terms set forth in the Pricing Certificate, and the Mayor is hereby
authorized to execute and deliver such Escrow Agreement on behalf of the City in multiple
counterparts and the City Secretary is hereby authorized to attest thereto and affix the City's seal.
Section 13.03. Redemption of Refunded Obligations.
The City hereby calls the Refunded Obligations for redemption prior to maturity on the
dates and at the prices set forth in the Pricing Certificate. The Mayor of the City is hereby
directed to notify the paying agent for the Refunded Obligations of such redemption in
accordance with each of the ordinances authorizing the issuance of the Refunded Obligations.
The paying agent for the Refunded Obligations is hereby authorized and directed to give notice
of such redemption to the owners thereof pursuant to such resolutions authorizing the issuance
thereof.
Section 13.04. Purchase of Federal Securities.
To assure the purchase of the Federal Securities to be identified in the Escrow
Agreement, the Mayor is hereby authorized to subscribe for, agree to purchase, and purchase
obligations of the United States of America, in such amounts and maturities and bearing interest
at such rates as may be provided for in the Escrow Agreement, 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.
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PRESENTED, FINALLY PASSED AND APPROVED, AND EFFECTIVE on the 7th
day of November, 2006, at a regular meeting of the City Council of the City of Grapevine,
Texas.
By:
Mayor, City of Grapevine, Texas
ATTEST:
City Se retary, City of Grf7 e, Texas
APPROVED AS TO FORM:
By:
City Attorney, City of Grapevine, Texas
Signature Page for Bond Ordinance
Dallas 1173258v.3
SCHEDULE I
SCHEDULE OF REFUNDED OBLIGATION CANDIDATES
Waterworks and Sewer System Revenue Bonds, Series 1996
Principal Principal
Original Amount Amount
Dated Date Maturity Date Interest Rate Outstanding Refunded
10/01/1996 09/01/2008 5.150% $150,000 $150,000
09/01/2009 5.250% 160,000 160,000
09/01/2010 5.300% 170,000 170,000
09/01/2011 5.350% 180,000 180,000
09/01/2012 5.400% 185,000 185,000
09/01/2013 5.500% 200,000 200,000
09/01/2014 5.500% 210,000 210,000
09/01/2015 5.500% 220,000 220,000
09/01/2016 5.500% 235,000 235,000
$1,710,000 $1,710,000
Waterworks and Sewer System Refunding and Improvement Bonds, Series 1997
Principal Principal
Original Amount Amount
Dated Date Maturity Date Interest Rate Outstanding Refunded
08/01/1997 09/01/2010 4.850% 415,000 415,000
09/01/2011 5.000% 440,000 440,000
09/01/2012 5.000% 465,000 465,000
09/01/2013 5.000% 495,000 495,000
09/01/2014 5.125% 525,000 525,000
09/01/2015 5.125% 555,000 555,000
09/01/2016 5.125% 585,000 585,000
09/01/2017 5.125% 625,000 625,000
$4,105,000 $4,105,000
Waterworks and Sewer System Revenue Bonds, Series 1999
Principal Principal
Original Amount Amount
Dated Date Maturity Date Interest Rate Outstanding Refunded
03/01/1999 09/01/2017 5.000% $ 520,000 $ 520,000
09/01/2018 5.000% 545,000 545,000
09/01/2019 5.000% 575,000 575,000
1,640,000 1,640,000
Schedule I-1
Dallas 1173258v.3
EXHIBIT A
DESCRIPTION OF ANNUAL DISCLOSURE OF FINANCIAL INFORMATION
The following information is referred to in Article XII of this Ordinance.
Annual Financial Statements and Operating Data
The financial information and operating data with respect to the City to be provided
annually in accordance with such Section are as specified (and included in the Appendix or other
headings of the Official Statement referred to)below:
1. The portions of the financial statements of the City appended to the Official Statement as
Appendix B, but for the most recently concluded fiscal year.
2. Statistical and financial data for the most recent five years with respect to information
described in "Section Three: The City of Grapevine" "Section Four: Debt Structure and
Capital Improvement Program,"and "Section Five: Financial Information."
Accounting Principles
The accounting principles referred to in such Section are the accounting principles
described in the notes to the financial statements referred to in Paragraph 1 above.
A-1
Dallas 1173258v.3
MINUTES AND CERTIFICATION PERTAINING TO
PASSAGE Or AN ORDINANCE
STATE OF TEXAS §
COUNTIES OF TARRANT §
CITY OF GRAPEVINE §
On the 7th day of November, 2006, the City Council of the City of Grapevine, Texas,
convened in a regular meeting at the regular meeting place thereof, the meeting being open to the
public and notice of said meeting, giving the date, place and subject thereof, having been posted
as prescribed by Chapter 551, Texas Government Code, as amended; and the roll was called of
the duly constituted officers and members of the City Council, which officers and members are
as follows:
William D. Tate, Mayor C. Shane Wilbanks )
Ted R. Ware, Mayor Pro Tem ) Members of
Clydene Johnson ) the Council
Darlene Freed )
Roy Stewart )
and all of said persons were present, except Sp gAc..eg , thus constituting a quorum.
Whereupon, among other business, a written ordinance bearing the following caption was
introduced:
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF
GRAPEVINE, TEXAS, GENERAL OBLIGATION REFUNDING
BONDS, SERIES 2006, IN AN AGGREGATE PRINCIPAL
AMOUNT NOT TO EXCEED $7,500,000; PROVIDING FOR
THE AWARD OF THE SALE THEREOF IN ACCORDANCE
WITH SPECIFIED PARAMETERS; AUTHORIZING THE
EXECUTION AND DELIVERY OF A PURCHASE CONTRACT
RELATING TO SAID BONDS; AUTHORIZING THE
EXECUTION AND DELIVERY OF A PAYING
AGENT/REGISTRAR AGREEMENT AND AN ESCROW
AGREEMENT; APPROVING THE OFFICIAL STATEMENT;
AND ENACTING OTHER PROVISIONS RELATING
THERETO;
The Ordinance, a full, true and correct copy of which is attached hereto, was read and
reviewed by the City Council.
Thereupon, it was duly moved and seconded that the Ordinance be finally passed and
adopted.
The Presiding Officer put the motion to a vote of the members of the City Council, and
the Ordinance was finally passed and adopted by the following vote:
AYES:
NAYS: Q
ABSTENTIONS: V
GRA325/71016
Dallas 1182615_I.DOC
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MINUTES APPROVED AND CERTIFIED TO BE TRUE AND CORRECT, and to
correctly reflect the duly constituted officers and members of the City Council of said City, and
the attached and following copy of said Ordinance is hereby certified to be a true and correct
copy of an official copy thereof on file among the official records of the City, all on this the 7th
day of November, 2006.
d-�
rvh
City Secretary, City of G pine, Texas
[SEAL]
Signature Page to Minutes and Certification