HomeMy WebLinkAboutORD 2009-010 BOND ORDINANCE NO. 2009-10
relating to
CITY OF GRAPEVINE, TEXAS
COMBINATION TAX AND TAX INCREMENT REINVESTMENT
ZONE NUMBER ONE REVENUE REFUNDING BONDS
SERIES 2009
Adopted: April 7, 2009
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND OTHER PRELIMINARY MATTERS
Section 1.01. Definitions. 5
Section 1.02. Findings. 8
Section 1.03. Table of Contents, Titles.and Headings. 8
Section 1.04. Interpretation. 8
ARTICLE II
SECURITY FOR THE BONDS; INTEREST AND SINKING FUND
Section 2.01. Revenue Pledge. 9
Section 2.02. Tax Levy for Payment of the Bonds. 9
Section 2.03. Interest and Sinking Fund. 10
ARTICLE III
AUTHORIZATION; GENERAL TERMS AND PROVISIONS REGARDING THE BONDS
Section 3.01. Authorization 10
Section 3.02. Date, Denomination, Maturities and Interest. 11
Section 3.03. Medium, Method and Place of Payment. 11
Section 3.04. Execution and Registration of Bonds 12
Section 3.05. Ownership. 13
Section 3.06. Registration, Transfer and Exchange. 13
Section 3.07. Cancellation 14
Section 3.08. Temporary Bonds. 14
Section 3.09. Replacement Bonds. 15
Section 3.10. Book-Entry-Only System. 16
Section 3.11. Successor Securities Depository; Transfer Outside Book-Entry Only System 16
Section 3.12. Payments to Cede & Co. : 17
ARTICLE IV
REDEMPTION OF BONDS BEFORE MATURITY
Section 4.01. Limitation on Redemption. 17
Section 4.02. Optional Redemption. 17
Section 4.03. Mandatory Sinking Fund Redemption. 17
Section 4.04. Partial Redemption. 18
Section 4.05. Notice of Redemption to Owners 18
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Section 4.06. Payment Upon Redemption. 19
Section 4.07. Effect of Redemption. 19
Section 4.08. 'Conditional Notice of Redemption. 19
Section 4.09. Lapse of Payment 20
ARTICLE V
PAYING AGENT/REGISTRAR
Section 5.01. Appointment of Initial Paying Agent/Registrar. 20
Section 5.02. Qualifications. 20
Section 5.03. Maintaining Paying Agent/Registrar 20
Section 5.04. Termination. 20
Section 5.05. Notice of Change to Owners. 20
Section 5.06. Agreement to Perform Duties and Functions. 21
Section 5.07. Delivery of Records to Successor. 21
ARTICLE VI
FORM OF THE BONDS
Section 6.01. Form Generally. 21
Section 6.02. Form of the Bonds. 21
Section 6.03. CUSIP Registration. 29
Section 6.04. Legal Opinion 30
Section 6.05. Statement of Insurance. 30
ARTICLE VII
SALE AND DELIVERY OF BONDS, DEPOSIT OF PROCEEDS
Section 7.01. Sale of Bonds, Official Statement. 30
Section 7.02. Control and Delivery of Bonds. 32
Section 7.03. Deposit of Proceeds 32
Section 7.04. Security of Funds. 33
ARTICLE VIII
INVESTMENTS
Section 8.01. Investments 33
Section 8.02. Investment Income. 33
ARTICLE IX
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 9.01. Payment of the Bonds. 33
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Section 9.02. Other Representations and Covenants 34
Section 9.03. Provisions Concerning Federal Income Tax Exclusion. 34
Section 9.04. No Private Use or Payment and No Private Loan Financing. 34
Section 9.05. No Federal Guaranty. 35
Section 9.06. Bonds are not Hedge Bonds. 35
Section 9.07. No-Arbitrage Covenant. 35
Section 9.08. Arbitrage Rebate. 35
Section 9.09. Information Reporting. 36
Section 9.10. Continuing Obligation 36
ARTICLE X
DEFAULT AND REMEDIES
Section 10.01. Events of Default 36
Section 10.02. Remedies for Default. 36
Section 10.03. Remedies Not Exclusive. 37
ARTICLE XI
DISCHARGE
Section 11.01. Discharge 37
ARTICLE XII
CONTINUING DISCLOSURE UNDERTAKING
Section 12.01. Annual Reports 37
Section 12.02. Material Event Notices 38
Section 12.03. Limitations, Disclaimers and Amendments. 38
ARTICLE XIII
REDEMPTION OF OBLIGATIONS; APPROVAL OF ESCROW AGREEMENT; PURCHASE
OF ESCROWED SECURITIES
Section 13.01. Payment:of Paying Agency. 40
Section 13.02. Escrow Agreement. 40
Section 13.03. Purchase of Federal Securities. 40
Section 13.04. Redemption and Payment of Refunded Obligations. 40
Section 13.05. Notice of Deposit and Redemption. 41
Schedule I— Schedule of Refunded Obligations
Exhibit A - Description of Annual Disclosure of Financial Information A-1
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ORDINANCE NO. 2009-10
AN ORDINANCE PROVIDING FOR THE ISSUANCE OF CITY
OF GRAPEVINE, TEXAS COMBINATION TAX AND TAX
INCREMENT REINVESTMENT ZONE NUMBER ONE
REVENUE REFUNDING BONDS, SERIES 2009, IN THE
AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED
$16,000,000; PROVIDING FOR THE AWARD OF THE SALE
THEREOF IN ACCORDANCE WITH SPECIFIED
PARAMETERS LEVYING A TAX IN PAYMENT THEREOF;
PRESCRIBING THE FORM OF SAID BONDS; APPROVING
THE OFFICIAL STATEMENT; APPROVING EXECUTION
AND DELIVERY OF A BOND PURCHASE AGREEMENT
AND AN ESCROW AGREEMENT; AND ENACTING OTHER
PROVISIONS RELATING THERETO;
WHEREAS, the City of Grapevine (the "City") created its Tax Increment Financing
Reinvestment Zone Number One (the "Zone") pursuant to Texas Tax Code, Chapter 311 and
established a Tax Increment Fund pursuant to the provision of Chapter 311; and
WHEREAS, the City Council ("City Council") of the City adopted Ordinance No. 96-82,
approving the issuance of its $28,915,000 Combination Tax and Tax Increment Reinvestment
Zone Revenue Certificates of Obligation, Series 1996 (the"Series 1996 Certificates"); and
WHEREAS, the City Council found and determined that the issuance of the Series 1996
Certificates would provide public works and facilities for the benefit, use and safety of the
citizens and taxpayers of the City; and
WHEREAS, the Series 1996 Certificates were issued pursuant to Texas Tax Code,
Chapter 311, as amended, and Texas Local Government Code, Chapter 271, Subchapter C, as
amended; and
WHEREAS, the Series 1996 Certificates remain outstanding and are secured by a pledge
of a continuing direct annual ad valorem tax levied by the City, within the limits prescribed by
law, upon all taxable property in the City, and by a lien on and pledge of the Tax Increments
deposited into the Tax Increment Fund established for the Zone, such pledge being subordinate
to any Prior Lien Obligations; and
WHEREAS, the City now desires to refund the Series 1996 Certificates as described on
Schedule I hereto (the "Refunded Obligations"); and
WHEREAS, Chapter 1207, Texas Government Code, authorizes the City to issue
refunding bonds and to deposit the proceeds from the sale thereof, and any other available funds
or resources, directly with a place of payment (paying agent) for the Refunded Obligations, and
such deposit, if made before such payment dates, shall constitute the making of firm banking and
financial arrangements for the discharge and final payment of the Refunded Obligations; and
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WHEREAS, Chapter 1207 further authorizes the City to enter into an escrow agreement
with a commercial bank or trust company with respect to the safekeeping, investment,
reinvestment, administration and disposition of any such deposit, upon such terms and conditions
as the City and such paying agent 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 Mellon Trust Company, N.A. is a trust company
that does not serve as a depository of the City, and the Escrow Agreement hereinafter authorized
constitutes an escrow agreement of the kind authorized and permitted by said Chapter 1207; 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 a pricing certificate (the "Pricing
Certificate"), and that such benefit is sufficient consideration for the refunding of the Refunded
Obligations; and
WHEREAS, pursuant to Chapter 1207, the City has found and determined that the bonds
herein authorized shall mature on the dates, bear interest at the rates and have such other terms
and provisions specified in the Pricing Certificate within the parameters set forth in this
Ordinance; 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 its bonds in a single series at this time; and
WHEREAS, it is officially found, determined and declared that the meeting at which this
Ordinance has been adopted was 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
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.
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"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, Combination Tax and Tax Increment
Reinvestment Zone Number One Revenue Refunding Bonds, Series 2009."
"Business Day" means a day that is not a Saturday, Sunday, legal holiday or other day on
which banking institutions in the city where the Designated Payment/Transfer Office is located
are required or authorized by law or executive order to close.
"City"means the City of Grapevine, Texas.
"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 herein, its office in Dallas, Texas, 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 Mellon Trust Company, N.A. or its
successors or assigns.
"Escrow Agreement" means that certain Escrow Agreement, authorized pursuant to
Section 13.02 herein and dated the date set forth in the Pricing Certificate, between the City and
the Escrow Agent.
"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.
"Initial Bond"means the Initial Bond authorized by Section 3.04(d) of this Ordinance.
"Interest and Sinking Fund" means the interest and sinking fund established by
Section 2.02 of this Ordinance.
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"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, as set forth 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 Mellon Trust
Company, N.A., or any successor thereto as provided in this Ordinance.
"Pledged Revenues" means Tax Increments on deposit or deposited into the Tax
Increment Fund and any other funds or sources of revenue that may be hereafter designated as
Pledged Revenues.
"Pricing Certificate" means a certificate or certificates to be signed by the Pricing
Officer.
"Pricing Officer"means the City Manager or Director of Administration of the City.
"Prior Lien Obligations"means (i) any future bonds or obligations issued by the City that
by the express terms thereof have a prior lien on and pledge of the Tax Increment Fund, and (ii)
any bonds or other obligations heretofore or hereafter issued by the City, or other participant in
the Reinvestment Zone, and secured by a levy of ad valorem taxes upon all taxable property
within the City, or such participant, respectively, for which the levy and collection of ad valorem
taxes have been insufficient for the payment thereof and which have a prior lien on the Tax
Increments of the City or such participant.
"Record Date" means the last Business Day of the month next preceding an Interest
Payment Date.
"Refunded Obligation Candidates" means the bonds 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 the bonds 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 bond register specified in Section 3.06(a) of this Ordinance.
"Reinvestment Zone" means Tax Increment Financing Reinvestment Zone Number One,
City of Grapevine, Texas, established by the City by an ordinance adopted February 20, 1996.
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"Representations Letter" means the Blanket Letter of Representations previously
executed by the City and DTC and on file with DTC.
"SEC"means the United States Securities and Exchange Commission.
"SID" means any person designated by the State of Texas or an authorized department,
officer 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.
"Special Payment Date" means the Special Payment Date prescribed by Section 3.03(b).
"Special Record Date"means the Special Record Date prescribed by Section 3.03(b).
"Tax Increment Fund" shall mean the fund established by the City pursuant to
Section 311.014 of the Act and into which all Tax Increments are deposited by the taxing units
participating in the Reinvestment Zone.
"Tax Increments" shall mean the taxes on real property located in the Reinvestment Zone
that the taxing units participating in the Reinvestment Zone, including the City, have agreed to
deposit into the Tax Increment Fund.
"Unclaimed Payments" means money deposited with the Paying Agent/Registrar for the
payment of principal of, redemption premium, if any, or interest on the Bonds as the same come
due and payable or money set aside for the payment of Bonds duly called for redemption prior to
maturity.
"Underwriters"the Underwriter(s) specified in the Pricing Certificate.
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.
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(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. Revenue Pledge.
(a) All Pledged Revenues deposited into the Tax Increment Fund pursuant to
Section 311.013 of the Act shall be accounted for separately from other funds of the City.
During each fiscal year while any of the Bonds are outstanding, the City shall transfer to the
Interest and Sinking Fund from the Pledged Revenues deposited into the Tax Increment Fund up
to an amount equal to the amount of the principal and interest payments coming due on the
Bonds during such fiscal year, such transfers to be made as and when such Pledged Revenues are
received and subject to the requirements of any Prior Lien Obligations.
(b) The City expressly reserves the right to issue or incur, under any applicable law,
bonds, notes or other obligations secured by and payable from a lien on and pledge of the
Pledged Revenues that is superior to, on a parity with or subordinate to the lien on and pledge of
the Pledged Revenues securing the payment of the Bonds.
(c) Subject to the requirements of any Prior Lien Obligations and to subsection(d) of
this Section 2.01, the Pledged Revenues are hereby pledged to the payment of the Bonds and
shall be deposited into the Interest and Sinking Fund.
(d) Any Pledged Revenues remaining in the Tax Increment Fund each fiscal year
after the payments required by subsection (a) of this Section 2.01, and subject to the
requirements of any Prior Lien Obligations, may be used for the purposes described in
Section 311.014(b) of the Act or as otherwise authorized by the Act.
Section 2.02. Tax Levy for Payment of the Bonds.
(a) The City Council hereby declares and covenants that it will provide and levy a tax
legally and fully sufficient for payment of the Bonds, it having been determined that the existing
and available taxing authority of the City for such purpose is adequate to permit a legally
sufficient tax in consideration of all other outstanding obligations of the City.
(b) In order to provide for the payment of the debt service requirements on the Bonds,
being (i) the interest on the Bonds, and (ii) a sinking fund for their payment at maturity or a
sinking fund of two percent per annum (whichever amount is the greater), there is hereby levied
for the current year and each succeeding year thereafter, while the Bonds or interest thereon
remain 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
such debt service requirements, full allowance being made for delinquencies and costs of
collection.
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(c) The tax levied by this Section shall be assessed and collected each year and
deposited into the Interest and Sinking Fund for the payment of the debt service requirements on
the Bonds, and the tax shall not be diverted to any other purpose.
(d) 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.
(e) Notwithstanding the requirements of this Section 2.02, if Pledged Revenues or
other legally available funds are budgeted and appropriated for deposit in the Interest and
Sinking Fund in advance of the time when ad valorem taxes are scheduled to be assessed and
collected for any year, then the amount of taxes which otherwise would be required to be
assessed and collected pursuant to this Section 2.02 may be reduced to the extent and by the
amount of the Pledged Revenues or other funds budgeted and appropriated for deposit in the
Interest and Sinking Fund.
(f) If the liens and provisions of this Ordinance shall be discharged in a manner
permitted by Article XI, 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 within
the Paying Agent/Registrar for such redemption.
Section 2.03. Interest and Sinking Fund.
(a) The City hereby establishes a special fund or account, to be designated the "City
of Grapevine, Texas Combination Tax and Tax Increment Reinvestment Zone Number One
Revenue Refunding Bonds, Series 2009, 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 Combination Tax and Tax
Increment Reinvestment Zone Number One Revenue Refunding Bonds, Series 2009," are hereby
authorized to be issued and delivered in accordance with Tex. Const. art. XI, Sec. 5, Chapter
1207 Texas Government Code, as amended, and Section 9.26 of the City's Home-Rule Charter.
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The Bonds shall be issued in the not to exceed aggregate principal amount of$16,000,000 for the
purpose of providing funds to (i) refund the Refunded Obligations, and (ii) pay the costs of
issuing the Bonds.
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 upward, except the Initial Bond,
which shall be numbered T-1.
(b) The Bonds shall mature on February 15 in the years and in the principal amounts
set forth in the Pricing Certificate. The Bonds shall mature and become payable no later than
February 15, 2016.
(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 the date set forth in the Pricing Certificate, 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; 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 and mailed on 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, that 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.
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(d) The principal of each Bond shall be paid to the Owner on the due date thereof
(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.
(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 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 escrow account and held in
trust, uninvested by the Paying Agent/Registrar, for the account of the Owners of the Bonds to
which the Unclaimed Payments pertain. Subject to Title 6 of the Texas Property Code, any
Unclaimed Payments remaining unclaimed by the Owners entitled thereto for three 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 Owners of such Bonds for any further payment of such unclaimed moneys or on account of
•
any such Bonds, subject to Title 6 of the Texas Property Code, any applicable escheat law or
similar.
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 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 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
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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, executed
manually or by facsimile 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 to DTC on behalf of the Purchaser one
registered definitive Bond for each year of maturity of the Bonds in the aggregate principal
amount of all Bonds for such maturity, registered in the name of Cede & Co., as nominee of
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 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 (except interest will be paid to the person in whose name such bond is registered on the
Record Date or Special Record Date, as applicable), 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 (the "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 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 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
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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 a 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, within 45 calendar
days prior to the date fixed for redemption; 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 dispose of cancelled Bonds in accordance with the Securities
Exchange Act of 1934.
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
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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 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 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 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 bond 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 an Owner, as
shown on the Register, of any notice with respect to the Bonds, including any notice of
redemption, or (iii) the payment to any DTC Participant or any other person, other than an
Owner, as shown 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 giving
notices of redemption and other matters with respect to such Bond, for the purpose of registering
transfer with respect to such Bond, and for all other purposes whatsoever. The 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.
(c) The Representations Letter previously executed and delivered by the City, and
applicable to the City's obligations delivered in book-entry-only form to DTC as securities
depository, is hereby ratified and approved for the Bonds.
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, 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
City shall (i) appoint a successor securities depository, qualified to act as such under
Section 17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC
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Dallas 1541202v3
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 certificated Bonds and cause the Paying Agent/Registrar to
transfer one or more separate registered 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 Owners
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 Representations
Letter 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 with such changes as are required by the Pricing Certificate.
(b) If less than all of the Bonds are to be redeemed pursuant to an optional
redemption, 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.
(c) : 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. 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.
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Dallas 1541202v3
(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
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 he reduced, as nearly as practicable, on a pro rata
basis.
Section 4.04. Partial Redemption.
(a) 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.
(b) 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.
(c) 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 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.
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(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 4.06. 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 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.
Section 4.08. Conditional Notice of Redemption.
The City reserves the right, in the case of an optional redemption pursuant to Section 4.01
herein, to give notice of its election or direction to redeem Bonds conditioned upon the
occurrence of subsequent events. Such notice may state (i) that the redemption is conditioned
upon the deposit of moneys and/or authorized securities, in an amount equal to the amount
necessary to effect the redemption, with the Paying Agent/Registrar, or such other entity as may
be authorized by law, no later than the redemption date, or (ii) that the City retains the right to
rescind such notice at any time on or prior to the scheduled redemption date if the City delivers a
certificate of the City to the Paying Agent/Registrar instructing the Paying Agent/Registrar to
rescind the redemption notice and such notice and redemption shall be of no effect if such
moneys and/or authorized securities are not so deposited or if the notice is rescinded. The
Paying Agent/Registrar shall give prompt notice of any such rescission of a conditional notice of
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redemption to the affected Owners. Any Bonds subject to conditional redemption and such
redemption has been rescinded shall remain Outstanding and the rescission of such redemption
shall not constitute an Event of Default. Further, in the case of a conditional redemption, the
failure of the City to make moneys and.or authorized securities available in part or in whole on
or before the redemption date shall not constitute an Event of Default.
Section 4.09. Lapse of Payment. Money set aside for the redemption of the Bonds and
remaining unclaimed by Owners thereof shall be subject to the provisions of Section 3.03(f)
hereof.
ARTICLE V
PAYING AGENT/REGISTRAR
Section 5.01. Appointment of Initial Paving Agent/Registrar.
The Bank of New York Mellon Trust Company, N.A. 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.
Section 5.03. Maintaining Paying 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 "Paying
Agent/Registrar Agreement"). 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
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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, including 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 face of the Bonds.
(c) The definitive Bonds shall be typewritten, photocopied, 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.
(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
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Agent/Registrar and the form of Assignment appearing on the Bonds, shall be substantially as
follows:
•
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(a) Form of Bond.
REGISTERED REGISTERED
No. $
United States of America
State of Texas
County of Tarrant
CITY OF GRAPEVINE, TEXAS
COMBINATION TAX AND TAX INCREMENT REINVESTMENT
ZONE NUMBER ONE REVENUE REFUNDING BOND
SERIES 2009
INTEREST RATE: MATURITY DATE: BOND DATE: CUSIP NUMBER:
February 15, , 20091
The City of Grapevine (the "City"), in the County of Tarrant, 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
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 designated office in Dallas, Texas (the "Designated Payment/Transfer Office"), of The Bank
of New York Mellon Trust Company, N.A. as Initial Paying Agent/Registrar, or, with respect to
a successor paying agent/registrar, at the Designated Payment/Transfer Office of such successor.
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
Insert based on Pricing Certificate.
2 Insert based on Pricing Certificate.
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arrangement. At the option of the 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; provided, however, in the event of nonpayment of interest on a scheduled 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 date 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 books of the Paying Agent/Registrar at the close of business
on the last Business Day next preceding the date of mailing of such notice.
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 Designated
Payment/Transfer Office 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 3 and is one of a series of fully registered bonds specified
in the title hereof issued in the aggregate principal amount of$ 4 (herein referred to
as the "Bonds"), issued pursuant to a certain ordinance of the City (the "Ordinance") for the
purpose of providing funds to refund certain outstanding obligations of the City, and to pay the
costs of issuing the Bonds.
[The City has reserved the option to redeem the Bonds maturing on or after August 15,
20 , in whole or in part, before their respective scheduled maturity dates, on February 15, 20_,
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 or other customary
method that results in a random selection the Bonds, or portions thereof, within such maturity
and in such principal amounts, for redemption.]5
[The Bonds stated to mature on (the "Term Bonds"), 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
3 Insert based on Pricing Certificate.
4 Insert based on Pricing Certificate.
5 Optional Redemption Provisions to be inserted from Pricing Certificate.
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Dallas 154120203
moneys available for such purpose in the Debt Service Fund, on the dates and in the respective
principal amounts as set forth in the following schedule:
Term Bonds Maturing
Redemption Date Principal
(February 15) Amount
20
20
20
20_(Maturity)
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 and shall call such Bonds for redemption on such
scheduled mandatory redemption date.
The principal amount of the Bonds required to be redeemed on any mandatory sinking
fund redemption date shall be reduced, at the option of the City, by the principal amount of any
Bonds which, at least 45 days prior to the mandatory sinking fund redemption date (i) shall have
been acquired by the City at a price not exceeding the principal amount of such Bonds plus
accrued interest to the date of purchase thereof, and delivered to the Paying Agent/Registrar for
cancellation, or (ii) shall have been redeemed pursuant to an optional redemption and not
previously credited to a mandatory sinking fund redemption.]6
The City reserves the right, in the case of an optional redemption pursuant to the terms of
the Ordinance, to give notice of its election or direction to redeem Bonds conditioned upon the
occurrence of subsequent events. Such notice may state (i) that the redemption is conditioned
upon the deposit of moneys and/or authorized securities, in an amount equal to the amount
necessary to effect the redemption, with the Paying Agent/Registrar, or such other entity as may
be authorized by law, no later than the redemption date, or (ii) that the City retains the right to
rescind such notice at any time on or prior to the scheduled redemption date if the City delivers a
certificate of the City to the Paying Agent/Registrar instructing the Paying Agent/Registrar to
rescind the redemption notice and such notice and redemption shall be of no effect if such
moneys and/or authorized securities are not so deposited or if the notice is rescinded. The
Paying Agent/Registrar shall give prompt notice of any such rescission of a conditional notice of
redemption to the affected Owners. Any Bonds subject to conditional redemption and such
redemption has been rescinded shall remain Outstanding and the rescission of such redemption
shall not constitute an event of default. Further, in the case of a conditional redemption, the
failure of the City to make moneys and or authorized securities available in part or in whole on
or before the redemption date shall not constitute an event of default.
6 Insert Mandatory Redemption Provisions from Pricing Certificate
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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 Designated Payment/Transfer
Office 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
45 calendar days of the date fixed for redemption; 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; 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; that,
in addition to said taxes, further provisions have been made for the payment of the debt service
requirements of the Bonds by pledging to such purpose, the Pledged Revenues, as defined in the
Ordinance, derived by the City from the Tax Increments on deposit or deposited into the Tax
Increment Fund, such taxes and Pledged Revenues shall be appropriated to such purposes; and
that the total indebtedness of the City, including the Bonds, does not exceed any constitutional or
statutory limitation.
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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]
(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]
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(c) Form of Certificate of Paving Agent/Registrar.
The following Certificate of Paying Agent/Registrar may be deleted from the Initial Bond
if the executed 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 MELLON
TRUST COMPANY,N.A.
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
Signature Guaranteed By: 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
Authorized Signatory Paying Agent/Registrar.
(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" and the words "CUSIP NUMBER:" shall be deleted;
(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:
Years Principal Installments Interest Rates
(Information to be inserted from schedule in the Pricing Certificate)
(iii) 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
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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 or attached to 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 Underwriters 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 Pricing Officer 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, acquisition of municipal bond insurance 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($16,000,000) and shall equal an amount sufficient to provide for
the refunding of the maximum amount of the Refunded Obligations to be selected from
the Refunded Obligation Candidates identified in Schedule I hereto that will result in a
reduction of debt service costs to the City on a present value basis of not less than 5.00%
of the Refunded Obligations; and
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(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.
The Pricing Officer is hereby authorized and directed to negotiate and deliver, a bond
purchase contract (the "Purchase Contract"), and upon completion of the terms of the Purchase
Contract in accordance with the terms of the Pricing Certificate and this Ordinance, the Pricing
Officer and other appropriate officials of the City are hereby authorized and directed to execute
such Purchase Contract on behalf of the City and the Pricing Officer 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 the Underwriter or its designee.
The authority granted to the Pricing Officer under this Section 7.01(a) shall expire on
August 1, 2009, unless otherwise extended by the City Council by separate action.
(b) The form and substance of the Preliminary Official Statement and any addenda,
supplement or amendment thereto, presented to and considered at this meeting are hereby in all
respects approved. The City's financial advisor, Bond Counsel, City Manager and Director of
Administration are each authorized to complete the Preliminary Official Statement with such
modifications, completions, changes and supplements, as those persons 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
within the meaning and for the purposes of paragraph(b)(1)of Rule 15c2-12 under the Securities
Exchange Act of 1934, as amended. The use and distribution of the revised Preliminary Official
Statement in the public offering of the Certificates by the Underwriters is hereby authorized.
The City Manager, Director of Administration, Mayor and the City Secretary of the City are
hereby 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 executed copies thereof
to the Underwriters of the Certificates. The Official Statement as thus approved, executed and
delivered, with such appropriate variations as shall be approved by the City Manager, Director of
Administration, Mayor of the City and the Underwriters, may be used by the Underwriters in the
public offering and sale thereof. The City Secretary is hereby authorized and directed to include
and maintain a copy of the Official Statement and any addenda, supplement or amendment
thereto thus approved among the permanent records of this meeting.
(c) 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 terms of sale therefor. 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
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a nonrefundable examination fee in the amount required by Chapter 1202, Texas Government
Code (such amount to be the lesser of(i) 1/10th of 1% of the principal amount of the Bonds or
(ii) $9,500).
(d) The obligation of the Underwriters to accept delivery of the Certificates is subject
to the Underwriters 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.
(e) 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 for the City, which opinion shall be dated as of and delivered on the Closing Date. The
Mayor is hereby authorized and directed to execute the engagement letter with Vinson & Elkins
L.L.P., setting forth such firm's duties as Bond Counsel for the City, and such engagement letter
and the terms thereof in the form presented at this meeting is hereby approved and accepted.
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 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.
(c) In the event the Mayor or City Secretary is absent or otherwise unable to execute
any document or take any action authorized herein, the Mayor Pro Tem and the Assistant City
Secretary, respectively, shall be authorized to execute such documents and take such actions, and
the performance of such duties by the Mayor Pro Tem and the Assistant City Secretary shall for
the purposes of this Ordinance have the same force and effect as if such duties were performed
by the Mayor and City Secretary, respectively.
Section 7.03. Deposit of Proceeds.
On the Closing Date, the City shall cause the proceeds from the sale of the Bonds to be
deposited as follows:
(a) All amounts received on the Closing Date as accrued interest on the Bonds from
the Original Issue 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 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.
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(c) The remaining balance received on the Closing Date shall be deposited to a
special fund, such moneys to be dedicated and used for paying the costs of issuance, including
any bond insurance premium..
Section 7.04. Security of Funds.
All moneys on deposit in funds referred to in this Ordinance shall be secured in the
manner and to the fullest extent required by the laws of the State of Texas for the security of
public funds and moneys on deposit in such funds shall be used only for the purposes permitted
by this Ordinance.
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
as in effect on the date of the investment.
(b) Any securities or obligations in which money in the Interest and Sinking Fund 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 Interest and Sinking Fund.
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) The investment and application of money in the Escrow Fund shall be in
accordance with the provisions of the Escrow Agreement.
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, principal of, and redemption
premium, if any, on the Bonds as will accrue or mature on the applicable Interest Payment Date,
maturity date or date of prior redemption if any.
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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, redemption premium, if any, 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.
•
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 tax purposes pursuant to sections 103 and 141 through 150 of the
Code and the applicable Income Tax 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 gross income, as defined in section 61 of the Code, 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 and
the Regulations, 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, that the proceeds of the Refunded Obligations have not been used and 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 promulgated thereunder.
Moreover, the City covenants and agrees that it will make such use of the proceeds of the Bonds
and the Refunded Obligations, 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 promulgated
thereunder.
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Section 9.05. No Federal Guaranty.
The City covenants and agrees not to take any action, or knowingly omit 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 applicable Regulations thereunder, except as permitted by section
149(b)(3) of the Code and such Regulations.
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 applicable Regulations thereunder.
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 applicable Regulations thereunder. 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 applicable Regulations promulgated
thereunder.
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 applicable 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 applicable 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
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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 promulgated thereunder.
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, redemption premium, if
any, 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 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.
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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.
The Bonds may be defeased, refunded and discharged 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. Thereafter, when and if audited financial statements become
available, the City shall provide such audited financial statements as required to each NRMSIR
and to any SID.
(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
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reference 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;
(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) defeasance;
(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 deposit made in accordance with Article XI that causes Bonds no longer to be
outstanding.
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(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
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 comprise 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 a person that is unaffiliated with the City(such as nationally recognized bond counsel)
detenmines 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 the type of financial information or operating data so provided.
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Dallas 1541202v3
ARTICLE XIII
REDEMPTION OF OBLIGATIONS; APPROVAL OF ESCROW AGREEMENT;
PURCHASE OF ESCROWED SECURITIES
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 an Escrow Agreement (the "Escrow Agreement") to be entered
into by and between the City and the Escrow Agent, the terms and provisions of which, as
delivered by the Pricing Officer pursuant to the Pricing Certificate, 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 (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. Purchase of Federal Securities.
To assure the purchase of the Federal Securities to be identified in the Escrow
Agreement, the Pricing Officer is hereby authorized to subscribe for, agree to purchase, and
purchase Federal Securities, 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.
Section 13.04. Redemption and Payment of Refunded Obligations.
The Refunded Obligations are hereby called for redemption or payment, as applicable,
and shall be paid on their payment date or redeemed prior to their stated maturities on the
redemption date and at the redemption price specified in the Pricing Certificate. Following the
deposit to the Escrow Fund as herein specified, the Refunded Obligations shall be payable solely
from and secured by the cash and securities on deposit in the Escrow Fund and shall cease to be
payable from Pledged Revenues.
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Daflas 1541202v3
Section 13.05. Notice of Deposit and Redemption.
The City Secretary is hereby authorized to cause notice of redemption to be given to the
respective paying agent/registrar for the Refunded Obligations by delivery of a certified copy of
this Ordinance. Each paying agent/registrar for the Refunded Obligations is hereby authorized
and directed to give notice of deposit and notice of redemption with respect to the Refunded
Obligations as required under the ordinance pursuant to which the Refunded Obligations were
issued.
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Dallas 1541202v3
FINALLY PASSED, APPROVED AND EFFECTIVE THIS APRIL 7th, 2009.
Mayor, City of Grapevine, Texas
ATTEST:
,
Amt.. Ii
City Secretary
City of Grapevine, Texas
[SEAL]
APPROVED AS TO FORM:
_.r
By 17 7" `! •
City Attorney, City of Gras vine, Texa'
Signature Page for Bond Ordinance
SCHEDULE I
SCHEDULE OF REFUNDED OBLIGATIONS
Combination Tax and Tax Increment Reinvestment Zone Revenue
Certificates of Obligation, Series 1996
Original Principal
Original Principal Amount
Dated Date Maturity Date Interest Rate Amount Refunded
10/01/1996 02/15/2010 . 5.250% $1,750,000 $1,750,000
02/15/2011 5.250% 1,890,000 1,890,000
02/15/2012 5.250% 2,005,000 2,005,000
02/15/2013m 5.250% 2,130,000 2,130,000
02/15/2014m1m 5.250% 2,260,000 2,260,000
02/15/2015(2) 5.250% 2,400,000 2,400,000
02/15/2016(2) 5.250% 2,550,000 2,550,000
$15,015,000 $15,015,000
The 2010-2016 maturities will be redeemed prior to original maturity as set forth in the Pricing
Certificate.
(`)Represents mandatory sinking fund redemption amounts for the Term Bond maturing February 15,2014.
12 Represents mandatory sinking fund redemption amounts for the Term Bond maturing February 15,2016.
Schedule I-1
Dallas 1541202v3
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 Article 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 set forth in Tables numbered 1 through 6 and 8
through 15.
Accounting Principles
The accounting principles referred to in such Article are the accounting principles
described in the notes to the financial statements referred to in Paragraph 1 above.
•
Exhibit A-1
Dallas 1541202v3
MINUTES AND CERTIFICATION PERTAINING TO
PASSAGE OF AN ORDINANCE
STATE OF TEXAS §
CITY OF GRAPEVINE §
On the 7th day of April, 2009, 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 Mike Lease )
C. Shane Wilbanks, Mayor Pro Tern Sharron Spencer ) Members of
Chris Coy ) the Council
Darlene Freed )
Roy Stewart )
and all of said persons were present except , thus
constituting a quorum. Whereupon, among other business, a written Ordinance bearing the
following caption was introduced:
AN ORDINANCE PROVIDING FOR THE ISSUANCE OF CITY
OF GRAPEVINE, TEXAS COMBINATION TAX AND TAX
INCREMENT REINVESTMENT ZONE NUMBER ONE
REVENUE REFUNDING BONDS, SERIES 2009, IN THE
AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED
$16,000,000; PROVIDING FOR THE AWARD OF THE SALE
THEREOF IN ACCORDANCE WITH SPECIFIED
PARAMETERS LEVYING A TAX IN PAYMENT THEREOF;
PRESCRIBING THE FORM OF SAID BONDS; APPROVING
THE OFFICIAL STATEMENT; APPROVING EXECUTION
AND DELIVERY OF A BOND PURCHASE AGREEMENT
AND AN ESCROW AGREEMENT; 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: 0 ABSTENTIONS: 0
Dallas 1541592v.1
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
r1+h day of A toy i I , 2009.
4451T1>\, City Secretary, City of Grap•4 ne,Texas
�.Yi�'t
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[SEAL] (v.J, :�\
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Minutes and Certification for Ordinance