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HomeMy WebLinkAboutORD 1991-016 BOND ORDINANCE ORDINANCE NO. 91-�_ $8,800,000 CITY OF GRAPEVINE, TEXAS GENERAL OBLIGATION BONDS, SERIES 1991 Dated: March 1, 1991 Adopted: March 5, 1991 TABLE OF CONTENTS Page Recitals 1 ARTICLE I Definitions and Other Preliminary Matters Section 1 . 01. Definitions 2 Section 1. 02 . Findings 3 Section 1. 03 . Table of Contents, Titles and Headings 3 Section 1. 04 . Interpretation 3 ARTICLE II Security for the Bonds; Interest and Sinking Fund Section 2 . 01. Tax Levy 4 Section 2 . 02 . Interest and Sinking Fund 4 ARTICLE III ' Authorization; General Terms and Provisions Regarding the Bonds Section 3 . 01 . Authorization 5 Section 3 . 02 . Date, Denomination, Maturities and Interest 5 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 9 Section 3 . 07 . Cancellation 10 Section 3 . 08 . Temporary Bonds 10 Section 3 . 09 . Replacement Bonds 10 Section 3 . 10 . Book-Entry Only System 12 Section 3 . 11 . Successor Securities Depository; 13 Transfer of Book-Entry Only System Section 3 . 12 . Payments to Cede & Co. 13 ARTICLE IV Redemption of Bonds Before Maturity Section 4 . 01. Limitation on Redemption 14 Section 4 . 02 . Optional Redemption 14 Section 4 . 03 . Partial Redemption 14 Section 4 . 04 . Notice of Redemption to Owners 15 Section 4 . 05 . Payment Upon Redemption 15 Section 4 . 06 . Effect of Redemption 15 ( i} ARTICLE V Paying Agent/Registrar Section 5 . 01. Appointment of Initial Paying Agent�Registrar 16 � Section 5. 02 . Qualifications 16 Section 5 . 03 . Maintaining Paying Agent/Registrar 16 Section 5 . 04 . Termination 16 Section 5 . 05 . Notice of Change to Owners 16 Section 5. 06 . Agreement to Perform Duties and Functions 1� Section 5 . 07 . Delivery of Records to Successor 17 ARTICLE VI Form of the Bonds Section 6 . 01 . Form Generally 17 Section 6 . 02 . Form of the Bonds 18 Section 6 . 03 . CUSIP Registration 23 Section 6 . 04 . Legal Opinion 23 Section 6 . 05 . Statement of Insurance 24 ARTICLE VII Sale and Delivery of Bonds; Deposit of Proceeds Section 7 . 01 . Sale of Bonds, Official Statement 24 Section ? . 02 . Control and Delivery of Bonds 24 Section 7 . 03 . Deposit of Proceeds 25 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 26 Section 9 . 02 . Other Representations and Covenants 26 ARTICLE X Default and Remedies Section 10 . 01. Events of Default 27 Section 10. 02 . Remedies for Default 28 Section 10 .03 . Remedies Not Exclusive 28 ( ii) ARTICLE XI Discharge Section 11 . 01 . Discharge by Payment 28 Section 11. 02 . Discharge by Deposit 29 � ARTICLE XII Emergency Section 12 . 01 . Declaring an Emergency 31 EXECUTION 31 (iii) ORDINANCE N0. 91- 16 AN ORDINANCE PROVIDING FOR THE ISSUANCE OF CITY OF GRAPEVINE, TEXAS, GENERAL OBLIGATION BONDS, SERIES 1991, IN THE AGGREGATE PRINCIPAL AMOUNT OF $8,800,000; ENACTING OTHER PROVISIONS RELATING THERETO; AND DECLARING AN EMERGENCY WHEREAS, the bonds hereinafter authorized were duly and favorably voted, as required by the Constitution and laws of the State of Texas, at an election held in the City of Grapevine, Texas (the "City" ) , on December 3, 1988; and WHEREAS, at said election, the following are among the purposes and amounts of the bonds which were authorized, reflecting any amount previously issued pursuant to each voted authorization, the amount therefrom being issued pursuant to this Ordinance, and the balance that remains unissued after the issuance of the bonds herein authorized, to wit: Amount Amount Election Amount Previously Being Unissued Purpose Date Voted Issued Issued Balance Streets 12/3/88 $22 ,570,000 $4,615,000 $8,800,000 $9, 155, 000 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 $8,800, 000 of such bonds at this time, all in a single issue; 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 Article 6252-17, Vernon ' s Texas Civil Statutes, as amended; therefore BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS: 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 the City' s bonds authorized to be issued by Section 3. 01 of this Ordinance and designated as "City of Grapevine, Texas, General Obligation Bonds, Series 1991, " in the aggregate principal amount of $8,800,000 . "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 . "DTC" shall mean The Depository Trust Company of New York, New York, or any successor securities depository. "DTC Participant" shall mean 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 . "Event of Default" means any event of default as defined in Section 10 . 01 of this Ordinance. "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 February 15 and August 15, commencing February 15, 1992 . -2- 11496 "Owner" means the person who is the registered owner of a Bond or Bonds, as shown in the Register. "Paying Agent/Registrar" means initially First City, Texas-Dallas, Dallas, Texas, or any successor thereto as provided in this Ordinance. "Record Date" means the last business day of the month next preceding an Interest Payment Date. "Register" means the Register specified in Section 3.06 (a) of this Ordinance. "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 for 90 days after the applicable payment or redemption date. Section 1 . 02 . Findinas . 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 Headinas . 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. -3- 11496 ARTICLE II SECURITY FOR THE BONDS; INTEREST AND SINKING FUND Section 2 . 01 . Tax Le�rv. (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 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. (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) 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 Bonds, Series 1991, Interest and Sinking Fund, " said fund to be maintained at an official depository -4- 11496 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 Bonds, Series 1991, " are hereby authorized to be issued and delivered in accordance with the Constitution and laws of the State of Texas, including specifically Article 1175, V.A.T.C.S. , as amended, and Section 9 .26 of the Charter of the City. The Bonds shall be issued in the aggregate principal amount of $8, 800,000, for the purpose of providing funds for payment of the costs of issuing the Bonds and for permanent public improvements, to wit: $8, 800, 000 for constructing and improving streets in and for the City, including sidewalks, landscaping, storm drainage improvements, parking facilities, traffic control and maintenance necessary and incidental thereto. Section 3 . 02 . Date, Denomination, Maturities and Interest. (a) The Bonds shall be dated March 1, 1991. 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 upward, except the Initial Bond, which shall be numbered T-l . (b) The Bonds shall mature on February 15 in the years and in the principal amounts set forth in the following schedule: Principal Interest Years Installments Rates 1993 $215,000 9 .25� 1994 235, 000 9 .25� 1995 255, 000 9 .25� 1996 285, 000 9 .25� 1997 300, 000 9 . 25� -5- 11496 1998 $335,000 9 .25� 1999 360,000 9 .25� 2000 385, 000 8 . 70� 2001 410,000 6 .40$ 2002 435, 000 6 .50� 2003 465, 000 6 .50� 2004 500, 000 6 .50� 2005 535, 000 6 . 60� 2006 570, 000 6 . 60$ 2007 615,000 6 . 70� 2008 650, 000 6 . 70� 2009 700, 000 6 . 70$ 2010 750,000 6 . 25� 2011 800, 000 6 . 25� (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 schedule contained in subsection (b) above. Such interest shall be payable semiannually commencing on February 15, 1992, and on each February 15 and August 15 thereafter until maturity or prior redemption. Interest on the Bonds shall be calculated on the basis of a 360-day year composed of 12 months of 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 the Owners as shown in the Register at the close of business on the Record Date. (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. (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 principal corporate office of the Paying Agent/Registrar. -6- 11496 (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 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 non-payment 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 any escheat, abandoned property or similar law, Unclaimed Payments remaining unclaimed by the Owners entitled thereto for four 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 moneys or on account of any such Bonds, subject to any applicable escheat law or similar law. Section 3 . 04 . Execution and ReQistration 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 said officers, and such facsimile seal on the Bonds shall have the same effect as if the official seal of the City had been manually impressed upon each of the Bonds . (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 -7- 11496 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 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, manually signed by the Mayor and City Secretary of the City, 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 registered definitive Bonds, each definitive Bond having a single, specified maturity and interest rate, in integral multiples of $5, 000, in accordance with instructions received from the initial purchaser or its designee. It shall be the duty of the initial purchaser or its designee to furnish to the Paying Agent/Registrar, at least five (5) business days prior to the Closing Date, written instructions on forms which the purchaser or its designee must request of and obtain from, and which shall be provided by, the Paying Agent/Registrar designating the names in which such definitive Bonds are to be registered, the addresses of the Owners, the respective maturities, interest rates and denominations . If such written instructions are not received within the specified time period, the cancellation of the Initial Bond and delivery of definitive Bonds in exchange therefor may be delayed until such instructions are received. 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 of the principal thereof and redemption premium, if any, thereon, for the further purpose of making and receiving payment of the interest thereon, and for all other purposes, whether or not such Bond is overdue, and -8- 11496 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 Exchanae. (a) So long as any Bonds remain outstanding, the City shall cause the Paying Agent/Registrar to keep at its principal corporate trust 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 principal corporate 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 principal corporate trust 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. (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 -9- 11496 redemption is scheduled to occur within 30 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. Section 3 . 09 . Replacement Bonds . (a) Upon the presentation and surrender to the Paying Agent/Registrar of a mutilated Bond, the Paying Agent/Registrar -10- 1149B 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 or her 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 connectio� 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 -11- 71496 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. Section 3 . 10 . Book-Entry Onl� System. 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, and except as provided in Section 3. 13 hereof, all of the outstanding 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 for each of the maturities thereof. 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 the 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 -12- 11496 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 Bond 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 representation letter of the City to DTC, and that it is in the best interest of the beneficial owners of the Bonds that they be able to obtain certificated Bonds, or in the event DTC discontinues the services described herein, the Issuer 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 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 . Pa�ments 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 representation letter of the Issuer to DTC. -13- 11496 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 . Qptional Redemption. (a) The City reserves the option to redeem Bonds maturing on and after February 15, 2002, in whole or any part, before their respective scheduled maturity dates, on February 15, 2001, or on any date thereafter, such redemption date or dates to be fixed by the City, at a price equal to the principal amount of the Bonds called for redemption plus accrued interest to the date fixed for redemption. (b) The City, at least 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 . Partial Redemption. (a) 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 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. -14- 1149B Section 4 . 04 . 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 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. (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 . 05 . Payment U�on 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 principal corporate 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 .06 . Effect of Redemption. (a) Notice of redemption having been given as provided in Section 4 . 04 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. -15- 11496 (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 Aaent/ Registrar. First City, Texas-Dallas, Dallas, Texas, is hereby appointed as the initial Paying Agent/Registrar for the Bonds . Section 5 . 02 . Oualifications . 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 . Section 5. 03 . Maintaining PayinC� 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 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 -16- 11498 date of the change and the name and mailing address of the replacement Paying Agent/Registrar. Section 5 . 06 . AQreement 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 . Deliver� 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 Generallv. (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 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 fac� of the Bonds . (c) The definitive Bonds shall be typewritten, printed, lithographed, or engraved, and may be 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 . -17- 11498 (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 Registra- tion 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 COUNTIES OF TARRANT, DALLAS AND DENTON CITY OF GRAPEVINE, TEXAS GENERAL OBLIGATION BOND SERIES 1991 INTEREST RATE: MATURITY DATE: BOND DATE: CUSIP NO. : March 1, 1991 The City of Grapevine, Texas (the "City" ) , in the Counties of Tarrant, Dallas and Denton, State of Texas, for value received, hereby promises to pay to 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 360-day year of twelve 30-day months, such interest to be paid semiannually on February 15 and August 15 of each year, commencing February 15, 1992 . -18- 1149B 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 principal corporate office of the Paying Agent/Registrar executing the registration certificate appearing hereon. 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. 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 non-payment on the date on which such payment is otherwise stated to be due and payable. This Bond is one of a series of fully registered bonds specified in the title hereof issued in the aggregate principal amount of $8,800, 000 (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 make various permanent public improvements for and within the City. The City has reserved the option to redeem the Bonds maturing on or after February 15, 2002, in whole or in part before their respective scheduled maturity dates, on February 15, 2001, 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. -19- 11496 Notice of such redemption or redemptions shall be given by first class mail, postage prepaid, not less than 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 principal corporate trust 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 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 30 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. -20- 1149B 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, City of Mayor, City of Grapevine, Gragevine, Texas Texas [SEAL] (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 N0. � 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. -21- 1149B 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. FIRST CITY, TEXAS-DALLAS Dallas, Texas, as Paying Agent/Registrar Dated: By: Authorized Signatory (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 Signature Guaranteed By: the name of the registered owner as it appears on the face of the within Bond in every particular and must be guar- anteed by an officer of a federal or state bank or a member of the National Associa- tion of Securities Dealers . Authorized Signatory -22- 11496 (e) The 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, 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 February 15 in each of the years, in the principal installments and bearing interest at the per annum rates in accordance with the following schedule: Principal Interest Years Installments Rates " (Information to be inserted from schedule in Section 3 . 02 of this Ordinance) (iii) in the second paragraph of the Bond, the wor'cis "executing the registration certificate appearing hereon" shall be deleted and an additional sentence shall be added to the paragraph as follows : "The initial Paying Agent�Registrar is First City, Texas-Dallas, Dallas, Texas . " ; and (iv) the Initial Bond shall be numbered T-1 . 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 Hutchison Boyle Brooks & Fisher, A Professional Corporation, 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. -23- 11496 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 . �ale of Bonds , Official Statement. (a) The Bonds have been duly advertised for public sale; a bid or bids have been received pursuant thereto, and the Bonds are hereby sold and shall be delivered to NCNB Capital Markets, Inc . , and Associates for a price of par plus accrued interest to the Closing Date being the best bid submitted at said public sale. (b) The Notice of Sale and Bidding Instructions and the Official Statement, dated February 18, 1991, and the Official Bid Form, dated March 5, 1991, prepared and distributed in connection with the sale of the Bonds are hereby approved, confirmed and adopted as official documents and statements of the City. (c) The use of such Notice of Sale and Bidding Instructions, Official Bid Form and Official Statement and all addenda, if any, thereto, in the offering and sale of the Bonds is hereby approved, authorized and ratified. (d) All officers of the City are authorized to execute such documents, certificates and receipts as they may deem appropriate in order to consummate the delivery of the Bonds in accordance with the Notice of Sale and Bidding Instructions therefor. (e) The obligation of the purchaser identified in subsection (a) of this Section to accept delivery of the Bonds is subject to such purchaser being furnished with the final, approving opinion of Hutchison Boyle Brooks & Fisher, A Professional Corporation, Bond Counsel for the City, which opinion shall be dated and delivered 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 -24- 11496 of Texas, registration by the Comptroller of Public Accounts of the State and registration with, and initial exchange or transfer by, the Paying Agent/Registrar. (b) After registration by the Comptroller of Public Accounts, 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, together with any premium on the Bonds, shall be deposited to the Interest and Sinking Fund. (b) The remaining balance received on the Closing Date shall be deposited to a special construction fund of the City, as directed by an authorized officer of the City, such moneys to be dedicated and used solely for the purposes for which the Bonds are being issued as herein provided. ARTICLE VIII INVESTMENTS Section 8 . 01 . Investments . (a) Money in the Interest and Sinking Fund created by this Ordinance, at the option of the City, 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(b) 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 -25- 1149B 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 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 . (c) The City hereby represents that the proceeds of the Bonds are needed at this time to finance the costs of the capital improvements for which the Bonds were issued (as specified in this Ordinance) ; that based on current facts, estimates, and circumstances, it is reasonably expected that final disbursement of the proceeds of the Bonds will occur within three years after the Closing Date, that substantial binding obligations to commence such improvements will be incurred within six months after such date, and that the construction or acquisition of the improvements will proceed with due diligence to completion; that it is not reasonably expected that the proceeds of the Bonds or money deposited in the Interest and Sinking Fund will be used or invested in a manner that would cause the Bonds to be or become "arbitrage bonds, " within the meaning of Section 148 of the Code; and -26- 11496 that, except for the Interest and Sinking Fund, no other funds or accounts have been established or pledged to the payment of the Bonds . (dj The City will not take any action or fail to take any action with respect to the investment of the proceeds of the Bonds or any other funds of the City, including amounts received from the investment of any of the foregoing, that, based upon the facts, estimates, and circumstances known on the Closing Date, would result in constituting the Bonds "arbitrage bonds, " within the meaning of such Section 148 of the Code, and the City will not take any deliberate action motivated by arbitrage that would have such result. (e) Proper officers of the City charged with the responsibility of issuing the Bonds are hereby directed to make, execute and deliver certifications as to facts, estimates and circumstances in existence as of the Closing Date and stating whether there are any facts, estimates or circumstances that would materially change the City' s current expectations . ( f) The City will comply with the provisions of Section 148(f) of the Code, and the regulations promulgated thereunder, relating to paying certain excess earnings of� investments of proceeds of the Bonds to the United States of America. (g) The covenants and representations made or required by this Section are for the benefit of the Owners and may be relied upon by the Owners and bond counsel for the City. 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 -27- 1149B Ordinance, and the continuation thereof for a period of 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. ARTICLE XI DISCHARGE Section 11. 01 . Discharge by Payment. When all Bonds have been paid in full as to principal and as to interest and premium, if any, or when all Bonds have become due and payable, whether at maturity or by prior redemption or otherwise, and the City shall have provided for the payment of the whole amount due or to become due on all Bonds then outstanding, including all interest that has accrued -28- 1149B thereon or that may accrue to the date of maturity or prior redemption, and any premium due or that may become due at maturity or prior redemption, by depositing with the Paying Agent/Registrar, for payment of the principal of such outstanding Bonds and the interest accrued thereon and any premium due thereon, the entire amount due or to become due thereon, and the City shall also have paid or caused to be paid all sums payable under this Ordinance by the City, including the compensation due or to become due the Paying Agent/ Registrar, then the Paying Agent/Registrar, upon receipt of a letter of instructions from the City requesting the same, shall discharge and release the lien of this Ordinance and execute and deliver to the City such releases or other instruments as shall be requisite to release the lien hereof. Section 11. 02 . Discharge by Deposit. (a) The City may discharge its obligation to pay the principal of, premium, if any, and interest on all or any portion of the Bonds and its obligation to pay other sums payable or to become payable under this Ordinance by the City, including the compensation due or to become due the Paying Agent/Registrar, in accordance with the following procedures : (i) depositing or causing to be deposited with the Paying Agent/Registrar an amount of money that, together with the interest earned on or capital gains or profits to be realized from the investment of such money, will be sufficient to pay the principal of, premium, if any, and accrued interest on such Bonds to maturity or to the date fixed for prior redemption of such Bonds, and to pay such other amounts as may be reasonably estimated by the Paying Agent/Registrar to become payable under this Ordinance with respect to the Bonds being provided for, including the compensation due or to become due the Paying Agent/Registrar; and (ii} providing the Paying Agent/Registrar with an opinion of nationally recognized bond counsel acceptable to the Paying Agent/Registrar to the effect that the deposit specified in subdivision (i) of this subsection (a) will not cause the interest on any of the Bonds to become subject to federal income taxation. (b) Subject to subsection (c) of this Section, upon compliance with subsection (a) of this Section, the Bonds the payment for which provision is thus made shall no longer be regarded as outstanding and unpaid, and the Paying Agent/Registrar, upon receipt of a letter of instructions from the City requesting the same, shall discharge and release the lien of this Ordinance as to such Bonds and shall execute and -29- 1149B deliver to the City such releases or other instruments as shall be requisite to release the lien hereof . (c) Before the discharge and release of any portion of the lien of this Ordinance pursuant to this Section, the City shall make the following provisions with the Paying Agent/Registrar: (i) the establishment of a separate escrow account fund with the Paying Agent/Registrar for the deposit pursuant to subsection (a) (i) of this Section; (ii) the payment to the Owners at the date of maturity or at the date fixed for prior redemption, as applicable, of the full amount to which the Owners of the appropriate Bonds would be entitled by way of principal, premium, if any, and interest to the date of such maturity or prior redemption; (iii) the investment of such moneys by the Paying Agent/Registrar 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 may be in book entry form, maturing and/or bearing interest payable at such times and in such amounts as will be sufficient to provide for the schedule� payment and/or redemption of such Bonds in securities or obligations maturing in sufficient time, in the judgment of the Paying Agent/Registrar, to make available the moneys required for such purposes; (iv) the sending of written notice by registered or certified United States mail to the Owner of each appropriate Bond then outstanding within 30 days following the date of such deposit that such moneys are so available for such payment; and (v) the payment to the City, periodically or following final payment of the principal of, premium, if any, and interest on the appropriate Bonds, of any moneys, interest earnings, profits or capital gains over and above the amounts necessary for such purposes . -30- 11496 ARTICLE XII EMERGENCY Section 12 . 01. Declaring an Emergency. That the public importance of this Ordinance and the fact that it is in the best interest of the City to provide for the permanent public improvements set forth in Section 3 . 01 hereof at the earliest possible date constitutes an emergency and creates a necessity for the immediate preservation of the public peace, property, health and safety of the citizens of the City, requiring that this Ordinance be passed and take effect as an emergency measure, and it is accordingly ordained that this Ordinance shall be in full force and effect from and after its passage in accordance with the Charter of the City. FINALLY PASSED, APPROVED AND EFFECTIVE this March 5, 1991 . ATTEST: Mayor, City of Grapevine, Texas � Ci y Secxeta , City of Grapevine, �'exas [SEAL] APPRUVLD AS TO FORM: /-----�------,,, ��` "} , � � City Attorney, City Grapevine, Texas -31- 11496