G-04-07-22-12A1 - 7/22/2004-oy-o7-as-iaAi
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF ROUND
ROCK, TEXAS GENERAL OBLIGATION AND
REFUNDING BONDS, SERIES 2004;
LEVYING AN AD VALOREM TAX IN SUPPORT OF THE BONDS;
APPROVING A PAYING AGENT/REGISTRAR AGREEMENT, AN
OFFICIAL STATEMENT, A PURCHASE AGREEMENT
AND AN ESCROW AGREEMENT; CALLING CERTAIN OBLIGATIONS
FOR REDEMPTION; AND AUTHORIZING OTHER MATTERS
RELATING TO THE BONDS
TABLE OF CONTENTS
Page
Preamble..................................................................1
Section 1. RECITALS, AMOUNT AND PURPOSE OF THE BONDS .................. 3
Section 2. DESIGNATION, DATE, DENOMINATIONS, NUMBERS AND
MATURITIES OF BONDS ........................................... 3
Section 3. INTEREST.......................................................4
Section 4. CHARACTERISTICS OF THE BONDS ................................. 4
Section 5. FORM OF BOND .................................................. 8
Section 6. TAX LEVY ...................................................... 16
Section 7. ESTABLISHMENT OF PROJECT FUND AND ESCROW FUND ............ 17
Section 8. DEFEASANCE OF BONDS ........................................ 17
Section 9. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS ..... 19
Section 10. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS;
BOND COUNSEL'S OPINION; CUSIP NUMBERS AND
CONTINGENT INSURANCE PROVISION, IF OBTAINED ............... 20
Section 11. COVENANTS REGARDING TAX EXEMPTION OF INTEREST ON
THEBONDS...................................................20
Section 12. SALE OF BONDS ................................................ 23
Section 13. APPROVAL OF OFFICIAL STATEMENT ............................ 23
Section 14. APPROVAL OF ESCROW AGREEMENT AND TRANSFER OF FUNDS .... 23
Section 15. APPROVAL OF A PAYING AGENT/REGISTRAR AGREEMENT ......... 24
Section 16. NOTICES OF REDEMPTION ...................................... 24
Section 17. NOTICE TO PAYING AGENT ..................................... 24
I
Paye
Section 18. CONTINUING DISCLOSURE UNDERTAKING ........................ 24
Section 19. AMENDMENT OF ORDINANCE ................................... 27
Section 20. REMEDIES IN EVENT OF DEFAULT ............................... 28
Section 21. ADDITIONAL BOND INSURANCE PROVISIONS ..................... 29
Section 22. NO RECOURSE AGAINST CITY OFFICIALS ......................... 29
Section 23. FURTHER ACTIONS ............................................. 29
Section 24. INTERPRETATIONS ............................................. 30
Section 25. INCONSISTENT PROVISIONS ..................................... 30
Section 26. INTERESTED PARTIES .......................................... 30
Section 27. SEVERABILITY ................................................. 30
EXIIIBIT A ESCROW AGREEMENT ......................................... A-1
EXIIIBIT B PURCHASE AGREEMENT ....................................... B-1
EXHIBIT C PAYING AGENT/REGISTRAR AGREEMENT ....................... C-1
EXHIBIT D NOTICES OF REDEMPTION ..................................... D-1
EXHIBIT E DESCRIPTION OF ANNUAL FINANCIAL INFORMATION ............. E-1
11
ORDINANCE NO. G -04-07-22-12A1
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF ROUND ROCK, TEXAS
GENERAL OBLIGATION AND REFUNDING BONDS, SERIES 2004;
LEVYING AN AD VALOREM TAX IN SUPPORT OF THE BONDS;
APPROVING A PAYING AGENT/REGISTRAR AGREEMENT, AN OFFICIAL
STATEMENT, A PURCHASE AGREEMENT AND AN ESCROW AGREEMENT;
CALLING CERTAIN OBLIGATIONS FOR REDEMPTION; AND AUTHORIZING
OTHER MATTERS RELATING TO THE BONDS
THE STATE OF TEXAS §
COUNTIES OF WILLIAMSON AND TRAVIS §
CITY OF ROUND ROCK §
WHEREAS, at an election held within the City of Round Rock, Texas (the "City") on
November 6, 2001 the voters of the City authorized the City Council of the City to issue in one or
more series the bonds set forth in proposition numbers 1, 2, 3 and 4 set forth below, which aggregate
$89,800,000 in aggregate principal amount; and
WHEREAS, the City Council deems it to be in the best interest of the City to issue
$10,100,000 of the remaining $25,155,000 from Proposition No. 1 for the purpose of constructing,
improving, extending, expanding, upgrading and/or developing City street, bridges and intersections
including, utility relocation, sidewalks, traffic safety and operational improvements, the purchase of
any necessary right-of-way, drainage improvements and other related costs, reserving the right to
issue the remaining $15,055,000 bonds authorized by Proposition No. 1; and
WHEREAS, the City Council deems it to be in the best interest of the City to issue
$3,620,000 of the remaining $11,175,000 from Proposition No. 2 for the purpose of constructing,
acquiring, improving, renovating, equipping, and/or developing land and buildings for City park and
recreational purposes including parkland, scenic easement, trail acquisition, pedestrian and bike trail
improvements, a recreation center and a senior citizen center and other related costs, reserving the
right to issue the remaining $7,555,000 bonds authorized by Proposition No. 2; and
WHEREAS, the City Council deems it to be in the best interest of the City to issue
$5,045,000 of the remaining $5,470,000 from Proposition No. 3 for the purpose of constructing,
improving, renovating and equipping City police and fire department facilities including the
acquisition of necessary sites and other related costs, reserving the right to issue the remaining
$425,000 bonds authorized by Proposition No. 3; and
WHEREAS, the City Council deems it to be in the best interest of the City to issue
$1,235,000 of the remaining $13,000,000 from Proposition No. 4 for the purpose of constructing,
improving, renovating, expanding and equipping Municipal Office Campus Phase II and Public Works
RR0CK\G0NdtdgB—b2004: 0,d—.CW
Building expansion including acquisition of necessary sites and related water, wastewater, drainage,
streets, sidewalks and parking infrastructure and other related costs, reserving the right to issue the
remaining $11,765,000 bonds authorized by Proposition No. 4; and
WHEREAS, the City has duly issued and there is now outstanding the following obligations:
City ofRound Rock, Texas Combination Tax and Revenue Certificates of Obligation,
Series 1995 (the "Series 1995 Certificates"); and
City of Round Rock, Texas General Obligation and Refunding Bonds, Series 1996
(the "Series 1996 Bonds"); and
WHEREAS, the City now desires to refund a portion of the Series 1995 Certificates
maturing on June 1 in each of the years 2006 through 2011, in the aggregate principal amount of
$1,270,000 and a portion of the Series 1996 Bonds maturing August 15, 2007 and August 15 in each
of the years 2009 through 2016, inclusive, and August 15, 2021 in the aggregate principal amount
of $10,845,000; (collectively, the "Refunded Obligations"); and
WHEREAS, the City Council of the City deems it advisable and in the best interest of the
City to refund the Refunded Obligations in order to achieve a gross savings of $696,177.74 and a net
present value savings of $637,244.31 and the City further finds that the aggregate amount of
payments under the Refunded Obligations exceeds the aggregate amount of payments under the
refunding bonds by $696,177.74; and
WHEREAS, Chapter 1207, Texas Government Code, as amended ("Chapter 1207")
authorizes the City to issue refunding bonds and to deposit the proceeds from the sale thereof
together with 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
WHEREAS, Chapter 1207 further authorizes the City to enter into an escrow agreement
with a paying agent for the Refunded Obligations 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
in Defeasance Securities, as defined herein; and
WHEREAS, the Escrow Agreement hereinafter authorized, constitutes an agreement of the
kind authorized and permitted by said Chapter 1207; and
WHEREAS, all the Refunded Obligations mature or are subject to redemption prior to
maturity within 20 years of the date of the bonds hereinafter authorized; and
RR0CK\G0AndKdgBon&2004: Ordi-Ced
WHEREAS, the City deems it appropriate to call for redemption the Refunded Obligations.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF ROUND
ROCK, TEXAS:
Section 1. RECITALS AMOUNT AND PURPOSE OF THE BONDS. The recitals set
forth in the preamble hereof are incorporated herein and shall have the same force and effect as if set
forth in this section. The bond or bonds of the City are hereby authorized to be issued pursuant to
Chapters 1207 and 1331, Texas Government Code, as amended and delivered in the aggregate
principal amount of $31,945,000, to: (A) provide $20,000,000 in funds for the following projects:
(i) construct, improve, expand, extend, upgrade and/or develop City streets, bridges, intersections,
including utility relocation, sidewalks, traffic safety and operational improvements and other related
costs; (ii) construct, improve, renovate and equip City police and fire department facilities including
acquisition of any necessary sites; (iii) construct, improve, expand, renovate and equip municipal
offices including acquisition of any necessary sites and related water, wastewater, drainage, streets,
sidewalks and parking infrastructure; (iv) construct, improve, renovate, expand and equip Municipal
Office Complex Phase II and Public Works Building Expansion including acquiring of necessary sites
and related water, wastewater, drainage, streets, sidewalks and parking infrastructure and other
related costs, (B) provide $12,510,000 to refund the Refunded Obligations and (C) pay the costs
associated with the issuance of the Bonds as further set forth in the preamble to this Ordinance.
Section 2. DESIGNATION, DATE, DENOMINATIONS, NUMBERS AND
MATURITIES OF BONDS. Each bond issued pursuant to this Ordinance shall be designated:
"CITY OF ROUND ROCK, TEXAS GENERAL OBLIGATION AND REFUNDING BOND,
SERIES 2004" and initially there shall be issued, sold, and delivered hereunder fully registered
bonds, without interest coupons, dated July 15, 2004, in the respective denominations and principal
amounts hereinafter stated, numbered consecutively from R-1 upward (except the initial Bond
submitted to the Attorney General of the State of Texas which will be numbered T-1), payable to the
respective initial registered owners thereof (as designated in Section 12 hereof), or to the registered
assignee or assignees of the Bonds or any portion or portions thereof (in each case, the "Registered
Owner"), and the Bonds shall mature and be payable serially on August 15 in each of the years and
in the principal amounts, respectively, as set forth in the following schedule:
YEARS
AMOUNTS
YEARS
AMOUNTS
2005
$ 210,000
2015
$1,880,000
2006
835,000
2016
1,955,000
2007
60,000
2017
2,025,000
2008
1,630,000
2018
2,130,000
2009
1,380,000
2019
2,235,000
2010
1,620,000
2020
2,350,000
2011
1,795,000
2021
2,470,000
2012
955,000
2022
1,355,000
2012
650,000
2023
1,420,000
2013
1,690,000
2024
1,495,000
2014
1,805,000
mode G0Anmc a0N:
The term "Bonds" as used in this Ordinance shall mean and include collectively the bonds initially
issued and delivered pursuant to this Ordinance and all substitute bonds exchanged therefor, as well
as all other substitute bonds and replacement bonds issued pursuant hereto, and the term "Bond" shall
mean any of the Bonds.
Section 3. INTEREST. The Bonds scheduled to mature during the years, respectively, set
forth below shall bear interest from the dates specified in the FORM OF BOND set forth in this
Ordinance to their respective dates of maturity at the following rates per annum:
YEARS
RATES
YEARS
RATES
2005
2.000%
2015
4.000%
2006
2.250
2016
4.000
2007
3.000
2017
5.000
2008
3.000
2018
5.000
2009
3.250
2019
5.000
2010
5.000
2020
5.250
2011
4.000
2021
5.250
2012
4.500
2022
5.000
2012
4.875
2023
5.000
2013
5.000
2024
5.250
2014
4.000
Interest shall be payable in the manner provided and on the dates stated in the FORM OF BOND set
forth in this Ordinance.
Section 4. CHARACTERISTICS OF THE BONDS. (a) Registration, Transfer,
Conversion and Exchanize; Authentication. The City shall keep or cause to be kept at JPMorgan
Chase Bank, Dallas, Texas (the "Paying Agent/Registrar") books or records for the registration of
the transfer, conversion and exchange of the Bonds (the "Registration Books"), and the City hereby
appoints the Paying Agent/Registrar as its registrar and transfer agent to keep such books or records
and make such registrations of transfers, conversions and exchanges under such reasonable regula-
tions as the City and Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall
make such registrations, transfers, conversions and exchanges as herein provided within three days
of presentation in due and proper form. The Paying Agent/Registrar shall obtain and record in the
Registration Books the address of the Registered Owner of each Bond to which payments with
respect to the Bonds shall be mailed, as herein provided; but it shall be the duty of each Registered
Owner to notify the Paying Agent/Registrar in writing of the address to which payments shall be
mailed, and such interest payments shall not be mailed unless such notice has been given. The City
shall have the right to inspect the Registration Books during regular business hours of the Paying
Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books
confidential and, unless otherwise required by law, shall not permit their inspection by any other
entity. The Paying Agent/Registrar shall make a copy of the Registration Books available in the State
of Texas. The City shall pay the Paying Agent/Registrar's standard or customary fees and charges
RR0CK\G0MAtdgBwds2004: OrdinmceCat
for making such registration, transfer, conversion, exchange and delivery of a substitute Bond or
Bonds. Registration of assignments, transfers, conversions and exchanges of Bonds shall be made
in the manner provided and with the effect stated in the FORM OF BOND set forth in this Ordinance.
Each substitute Bond shall bear a letter and/or number to distinguish it from each other Bond.
Except as provided in Section 4(c) hereof, an authorized representative of the Paying
Agent/Registrar shall, before the delivery of any such Bond, date and manually sign the Bond, and
no such Bond shall be deemed to be issued or outstanding unless such Bond is so executed. The
Paying Agent/Registrar promptly shall cancel all paid Bonds and Bonds surrendered for conversion
and exchange. No additional orders, orders, or resolutions need be passed or adopted by the govern-
ing body of the City or any other body or person so as to accomplish the foregoing conversion and
exchange of any Bond or portion thereof, and the Paying Agent/Registrar shall provide for the
printing, execution, and delivery of the substitute Bonds in the manner prescribed herein, and the
Bonds shall be of type composition printed on paper with lithographed or steel engraved borders of
customary weight and strength. Pursuant to Chapter 1201, Texas Government Code, as amended,
and particularly Subchapter D thereof, the duty of conversion and exchange of Bonds as aforesaid
is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of the Bond, the
converted and exchanged Bond shall be valid, incontestable, and enforceable in the same manner and
with the same effect as the Bonds which initially were issued and delivered pursuant to this
Ordinance, approved by the Attorney General, and registered by the Comptroller ofPublic Accounts.
(b) Payment of Bonds and Interest. The City hereby further appoints the Paying
Agent/Registrar to act as the paying agent for paying the principal of and interest on the Bonds, all
as provided in this Ordinance. The Paying Agent/Registrar shall keep proper records of all payments
made by the City and the Paying Agent/Registrar with respect to the Bonds, and of all conversions
and exchanges of Bonds, and all replacements of Bonds, as provided in this Ordinance. However,
in the event of a nonpayment of interest on a scheduled payment date, and for thirty (3 0) days thereaf-
ter, a new record date for such interest payment (a "Special Record Date") will 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 (which shall be 15 days after the Special Record Date) shall be sent at least five (5) business
days prior to the Special Record Date by United States mail, first-class postage prepaid, to the
address of each Registered Owner appearing on the Registration Books at the close of business on
the last business day next preceding the date of mailing of such notice.
(c) In General. The Bonds (i) shall be issued in fully registered form, without interest
coupons, with the principal of and interest on such Bonds to be payable only to the Registered
Owners thereof, (ii) may be transferred and assigned, (iii) may be converted and exchanged for other
Bonds, (iv) shall have the characteristics, (v) shall be signed, sealed, executed and authenticated, (vi)
the principal of and interest on the Bonds shall be payable, and (vii) shall be administered and the
Paying Agent/Registrar and the City shall have certain duties and responsibilities with respect to the
Bonds, all as provided, and in the manner and to the effect as required or indicated, in the FORM OF
BOND set forth in this Ordinance. The Bonds initially issued and delivered pursuant to this
Ordinance are not required to be, and shall not be, authenticated by the Paying Agent/Registrar, but
RR0CK\G0MAidgBon&2004: Orlin Cot 5
on each substitute Bond issued in conversion of and exchange for any Bond or Bonds issued under
this Ordinance the Paying Agent/Registrar shall execute the PAYING AGENT/REGISTRAR'S
AUTHENTICATION CERTIFICATE, in the form set forth in the FORM OF BOND.
(d) Substitute PMing Agent/Registrar. The City covenants with the Registered Owners of
the Bonds that at all times while the Bonds are outstanding the City will provide a competent and
legally qualified bank, trust company, financial institution, or other agency to act as and perform the
services of Paying Agent/Registrar for the Bonds under this Ordinance, and that the Paying
Agent/Registrar will be one entity. The City reserves the right to, and may, at its option, change the
Paying Agent/Registrar upon not less than 30 days written notice to the Paying Agent/Registrar, to
be effective at such time which will not disrupt or delay payment on the next principal or interest
payment date after such notice. In the event that the entity at any time acting as Paying
Agent/Registrar (or its successor by merger, acquisition, or other method) should resign or otherwise
cease to act as such, the City covenants that promptly it will appoint a competent and legally qualified
bank, trust company, financial institution, or other agency to act as Paying Agent/Registrar under this
Ordinance. Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar
promptly shall transfer and deliver the Registration Books (or a copy thereof), along with all other
pertinent books and records relating to the Bonds, to the new Paying Agent/Registrar designated and
appointed by the City. Upon any change in the Paying Agent/Registrar, the City promptly will cause
a written notice thereof to be sent by the new Paying Agent/Registrar to each Registered Owner of
the Bonds, by United States mail, first-class postage prepaid, which notice also shall give the address
of the new Paying Agent/Registrar. By accepting the position and performing as such, each Paying
Agent/Registrar shall be deemed to have agreed to the provisions of this Ordinance, and a certified
copy of this Ordinance shall be delivered to each Paying Agent/Registrar.
(e) Book-Entrv-OnlySystem. The Bonds issued in exchange for the Bonds initially issued
as provided in Section 4(h) shall be issued in the form of a separate single fully registered Bond for
each of the maturities thereof registered in the name of Cede & Co., as nominee of The Depository
Trust Company of New York ("DTC") and except as provided in subsection (f) hereof, all of the
outstanding Bonds shall be registered in the name of Cede & Co., as nominee of DTC.
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 securities 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 (the "DTC Participant") or to any person on behalf of whom such a DTC
Participant holds an interest in the Bonds. Without limiting the immediately preceding sentence, the
City and the Paying Agent/Registrar shall have no responsibility or obligation with respect to (i) the
accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership
interest in the Bonds, (ii) the delivery to any DTC Participant or any other person, other than a
Registered Owner, as shown on the Registration Books, of any notice with respect to the Bonds, or
(iii) the payment to any DTC Participant or any person, other than a Registered Owner, as shown on
the Registration Books of any amount with respect to principal of or interest on the Bonds.
Notwithstanding any other provision of this Ordinance to the contrary, but to the extent permitted
RR0MG0AnAtdgBmd120G4: Ordin Cw
by law, 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 Registration Books as the absolute owner of such Bond
for the purpose of payment of principal of and interest, with respect to such Bond, for the purposes
of registering transfers with respect to such Bond, and for all other purposes of registering transfers
with respect to such Bonds, and for all other purposes whatsoever. The Paying Agent/Registrar shall
pay all principal of and interest on the Bonds only to or upon the order of the respective Registered
Owners, as shown in the Registration Books 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 principal of and interest on the Bonds
to the extent of the sum or sums so paid. No person other than a Registered Owner, as shown in the
Registration Books, shall receive a Bond evidencing the obligation of the City to make payments of
principal, and interest 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., and subject to the provisions in this Ordinance with respect to interest checks
being mailed to the registered owner at the close of business on the Record Date the word "Cede &
Co." in this Ordinance shall refer to such new nominee of DTC.
(f) Successor Securities Depository: Transfer Outside Book -Entry -Only System. In the event
that the City determines to discontinue the book -entry system through DTC or a successor or DTC
determines to discontinue providing its services with respect to the Bond, the City shall either (i)
appoint a successor securities depository, qualified to act as such under Section 17(a) of the
Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants of the
appointment of such successor securities depository and transfer one or more separate Bonds to such
successor securities depository or (ii) notify DTC and DTC Participants of the availability through
DTC of Bonds and transfer one or more separate Bonds to DTC Participants having Bonds credited
to their DTC accounts. In such event, the Bonds shall no longer be restricted to being registered in
the Registration Books 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 the
Registered Owner transferring or exchanging Bond shall designate, in accordance with the provisions
of this Ordinance.
(g) Payments to Cede & Co. Notwithstanding any other provision of this Ordinance to the
contrary, so long as any Bond is registered in the name of Cede & Co., as nominee of DTC, all
payments with respect to principal of, and interest on such Bond and all notices with respect to such
Bond shall be made and given, respectively, in the manner provided in the Letter of Representations
of the City to DTC.
(h) DTC Blanket Letter of Representations. The City confirms execution of a Blanket Issuer
Letter of Representations with DTC establishing the Book -Entry -Only System which will be utilized
with respect to the Bonds.
(i) Cancellation of Initial Bond. On the closing date, one initial Bond representing the entire
principal amount of the Bonds, payable in stated installments to the order of the Underwriter of the
Bonds or its designee set forth in Section 12 of this Ordinance, executed by manual or facsimile
RR0CK\G0MWRcfSBwds2004: Ordinm Cv 7
signature of the Mayor or Mayor Pro -tem and City Secretary, approved by the Attorney General of
Texas, and registered and manually signed by the Comptroller of Public Accounts of the State of
Texas, will be delivered to such Underwriters set forth in Section 12 of this Ordinance 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 such underwriter one registered definitive Bond for each year of maturity
of the Bonds, in the aggregate principal amount of all the Bonds for such maturity.
Section 5. FORM OF BOND. The form of the Bond, including the form of Paying
Agent/Registrar's Authentication Certificate, the form of Assignment, the form of initial Bond and
the form of Registration Certificate of the Comptroller of Public Accounts of the State of Texas to
be attached to the Bonds initially issued and delivered pursuant to this Ordinance, shall be, respec-
tively, substantially as follows, with such appropriate variations, omissions, or insertions as are
permitted or required by this Ordinance including any reproduction of an opinion of counsel and
information regarding the issuance of any bond insurance policy.
NO. R -
FORM OF BOND
UNITED STATES OF AMERICA
STATE OF TEXAS
WILLIAMSON AND TRAVIS COUNTIES
CITY OF ROUND ROCK, TEXAS
GENERAL OBLIGATION AND REFUNDING BOND
SERIES 2004
INTEREST RATE DATE OF BOND MATURITY DATE
July 15, 2004
REGISTERED OWNER:
PRINCIPAL AMOUNT:
PRINCIPAL
AMOUNT
CUSIP NO.
DOLLARS
ON THE MATURITY DATE specified above, ROUND ROCK, TEXAS (the "City"),
being a political subdivision of the State of Texas, hereby promises to pay to the Registered Owner
set forth above, or registered assigns (hereinafter called the "Registered Owner") the principal amount
set forth above, and to pay interest thereon from July 15, 2004, on February 15, 2005 and
semiannually thereafter on each August 15 and February 15 to the maturity date specified above, or
the date of redemption prior to maturity, at the interest rate per annum specified above calculated on
the basis of a 360 -day year of twelve 30 -day months; except that if this Bond is required to be
authenticated and the date of its authentication is later than the first Record Date (hereinafter
defined), such principal amount shall bear interest from the interest payment date next preceding the
date of authentication, unless such date of authentication is after any Record Date but on or before
the next following interest payment date, in which case such principal amount shall bear interest from
RR0MO0MdRdgBwnds2004: OrcF-Cat
such next following interest payment date; provided, however, that if on the date of authentication
hereof the interest on the Bond or Bonds, if any, for which this Bond is being exchanged or converted
from is due but has not been paid, then this Bond shall bear interest from the date to which such
interest has been paid in full. Notwithstanding the foregoing, during any period in which ownership
of the Bonds is determined only by a book entry at a securities depository for the Bonds, any payment
to the securities depository, or its nominee or registered assigns, shall be made in accordance with
existing arrangements between the City and the securities depository.
THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the
United States of America, without exchange or collection charges. The principal of this Bond shall
be paid to the Registered Owner hereof upon presentation and surrender of this Bond at maturity or
upon the date fixed for its redemption prior to maturity, at JPMorgan Chase Bank (the "Paying
Agent/Registrar") at their office for payment in Dallas, Texas (the "Designated Payment/Transfer
Office"). The payment of interest on this Bond shall be made by the Paying Agent/Registrar to the
Registered Owner hereof on each interest payment date by check or draft, dated as of such interest
payment date, drawn by the Paying Agent/Registrar on, and payable solely from, funds of the City
required by the ordinance authorizing the issuance of this Bond (the 'Bond Ordinance") to be on
deposit with the Paying Agent/Registrar for such purpose as hereinafter provided; and such check or
draft shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid,
on each such interest payment date, to the Registered Owner hereof, at its address as it appeared on
the close of business on the last day of the month next preceding each such date (the "Record Date")
on the registration books kept by the Paying Agent/Registrar (the "Registration Books"). In addition,
interest may be paid by such other method, acceptable to the Paying Agent/Registrar, requested by,
and at the risk and expense of, the Registered Owner. In the event of a non-payment of interest on
a scheduled payment date, and for 30 days thereafter, a new record date for such interest payment
(a "Special Record Date") will 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 (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
Registration Books at the close of business on the last business day next preceding the date of mailing
of such notice.
DURING ANY PERIOD in which ownership of the Bonds is determined only by a book
entry at a securities depository for the Bonds, if fewer than all of the Bonds of the same maturity and
bearing the same interest rate are to be redeemed, the particular Bonds of such maturity and bearing
such interest rate shall be selected in accordance with the arrangements between the City and the
securities depository.
ANY ACCRUED INTEREST due at maturity as provided herein shall be paid to the
Registered Owner upon presentation and surrender of this Bond for payment at the Designated
Payment/Transfer Office of the Paying Agent/Registrar. The City covenants with the Registered
Owner of this Bond that on or before each payment date for this Bond it will make available to the
Paying Agent/Registrar, from the "Interest and Sinking Fund" created by the Bond Ordinance, the
RR0CK\O0MdRdgBondf2004: Ordi—Cat
amounts required to provide for the payment, in immediately available funds, of all principal of and
interest on the Bonds, when due.
IF THE DATE for the payment of the principal of or interest on this Bond shall be a
Saturday, Sunday, a legal holiday, or a day on which banking institutions in the City where the
principal corporate trust office of the Paying Agent/Registrar is located are authorized by law or
executive order to close, then the date for such payment shall be the next succeeding day which is not
such a Saturday, Sunday, legal holiday, or day on which banking institutions are 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.
THIS BOND is one of a series of Bonds dated July 15, 2004, authorized in accordance with
the Constitution and laws of the State of Texas in the principal amount of $31,945,000, TO: (A)
PROVIDE $20,000,000 IN FUNDS FOR THE FOLLOWING PROJECTS: (I) CONSTRUCT,
IMPROVE, EXPAND, EXTEND, UPGRADE AND/OR DEVELOP CITY STREETS,
BRIDGES, INTERSECTIONS, INCLUDING UTILITY RELOCATION, SIDEWALKS,
TRAFFIC SAFETY AND OPERATIONAL IMPROVEMENTS AND OTHER RELATED
COSTS; (H) CONSTRUCT, IMPROVE, RENOVATE AND EQUIP CITY POLICE AND
FIRE DEPARTMENT FACILITIES INCLUDING ACQUISITION OF ANY NECESSARY
SITES; (III) CONSTRUCT, IMPROVE, EXPAND, RENOVATE AND EQUIP MUNICIPAL
OFFICES INCLUDING ACQUISITION OF ANY NECESSARY SITES AND RELATED
WATER, WASTEWATER, DRAINAGE, STREETS, SIDEWALKS AND PARKING
INFRASTRUCTURE; (IV) CONSTRUCT, IMPROVE, RENOVATE, EXPAND AND EQUIP
MUNICIPAL OFFICE COMPLEX PHASE H AND PUBLIC WORKS BUILDING
EXPANSION INCLUDING ACQUIRING OF NECESSARY SITES AND RELATED
WATER, WASTEWATER, DRAINAGE, STREETS, SIDEWALKS AND PARKING
INFRASTRUCTURE AND OTHER RELATED COSTS, (B) PROVIDE $12,510,000 TO
REFUND THE REFUNDED OBLIGATIONS AND (C) PAY THE COSTS ASSOCIATED
WITH THE ISSUANCE OF THE BONDS.
ON AUGUST 15, 2013, or on any date thereafter, the Bonds of this Series maturing on and
after August 15, 2014 may be redeemed prior to their scheduled maturities, at the option of the City,
with funds derived from any available and lawful source, at par plus accrued interest to the date fixed
for redemption as a whole, or from time to time in part, and, if in part, the particular maturities to be
redeemed shall be selected and designated by the City and if less than all of a maturity is to be
redeemed, the Paying Agent/Registrar shall determine by lot the Bonds, or a portion thereof, within
such maturity to be redeemed (provided that a portion of a Bond may be redeemed only in an integral
multiple of $5,000).
NO LESS THAN 30 days prior to the date fixed for any such redemption, the City shall
cause the Paying Agent/Registrar to send notice by United States mail, first-class postage prepaid to
the Registered Owner of each Bond to be redeemed at its address as it appeared on the Registration
Books of the Paying Agent/Registrar at the close of business on the 45th day prior to the redemption
RR0WG0A..MdgBor.e2004: 0,d-Cet 10
date and to major securities depositories, national bond rating agencies and bond information services;
provided, however, that the failure to send, mail or receive such notice, or any defect therein or in
the sending or mailing thereof, shall not affect the validity or effectiveness of the proceedings for the
redemption of any Bonds. By the date fixed for any such redemption due provision shall be made
with the Paying Agent/Registrar for the payment of the required redemption price for the Bonds or
portions thereof which are to be so redeemed. If due provision for such payment is made, all as
provided above, the Bonds or portions thereof which are to be so redeemed thereby automatically
shall be treated as redeemed prior to their scheduled maturities, and they shall not bear interest after
the date fixed for redemption, and they shall not be regarded as being outstanding except for the right
of the Registered Owner to receive the redemption price from the Paying Agent/Registrar out of the
funds provided for such payment. If a portion of any Bonds shall be redeemed a substitute Bonds or
Bonds having the same maturity date, bearing interest at the same rate, in any denomination or
denominations in any integral multiple of $5,000, at the written request of the Registered Owner, and
in aggregate principal amount equal to the unredeemed portion thereof, will be issued to the
Registered Owner upon the surrender thereof for cancellation, at the expense of the City, all as
provided in the Bond Ordinance.
ALL BONDS OF THIS SERIES are issuable solely as fully registered Bonds, without
interest coupons, in the denomination of any integral multiple of $5,000. As provided in the Bond
Ordinance, this Bond, or any unredeemed portion hereof, may, at the request of the Registered
Owner or the assignee or assignees hereof, be assigned, transferred, converted into and exchanged
for a like aggregate principal amount of fully registered Bonds, without interest coupons, payable to
the appropriate Registered Owner, assignee or assignees, as the case may be, having the same
denomination or denominations in any integral multiple of $5,000 as requested in writing by the
appropriate Registered Owner, assignee or assignees, as the case maybe, upon surrender ofthis Bond
to the Paying Agent/Registrar for cancellation, all in accordance with the form and procedures set
forth in the Bond Ordinance. Among other requirements for such assignment and transfer, this Bond
must be presented and surrendered to the Paying Agent/Registrar, together with proper instruments
of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/Registrar,
evidencing assignment of this Bond or any portion or portions hereof in any integral multiple of
$5,000 to the assignee or assignees in whose name or names this Bond or any such portion or
portions hereof is or are to be registered. The form of Assignment printed or endorsed on this Bond
may be executed by the Registered Owner to evidence the assignment hereof, but such method is not
exclusive, and other instruments of assignment satisfactory to the Paying Agent/Registrar may be
used to evidence the assignment of this Bond or any portion or portions hereof from time to time by
the Registered Owner. The Paying Agent/Registrar's reasonable standard or customary fees and
charges for assigning, transferring, converting and exchanging any Bond or portion thereof will be
paid by the City. In any circumstance, any taxes or governmental charges required to be paid with
respect thereto shall be paid by the one requesting such assignment, transfer, conversion or exchange,
as a condition precedent to the exercise of such privilege. The Paying Agent/Registrar shall not be
required to make any such transfer, conversion, or exchange during the period commencing on the
close of business on any Record Date and ending with the opening of business on the next following
principal or interest payment date.
RR0MG0n„mRdesor1s2004: Or&n—Cat I I
WHENEVER the beneficial ownership of this Bond is determined by a book entry at a
securities depository for the Bonds, the foregoing requirements of holding, delivering or transferring
this Bond shall be modified to require the appropriate person or entity to meet the requirements of
the securities depository as to registering or transferring the book entry to produce the same effect.
IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the City, resigns,
or otherwise ceases to act as such, the City has covenanted in the Bond Ordinance that it promptly
will appoint a competent and legally qualified substitute therefor, and cause written notice thereof to
be mailed to the Registered Owners of the Bonds.
IT IS HEREBY certified, recited, and covenanted that this Bond has been duly and validly
authorized, issued, and delivered; that all acts, conditions, and things required or proper to be
performed, exist, and be done precedent to or in the authorization, issuance, and delivery ofthis Bond
have been performed, existed, and been done in accordance with law; and that ad valorem taxes
sufficient to provide for the payment of the interest on and principal of this Bond, as such interest
comes due, and as such principal matures, have been levied and ordered to be levied against all
taxable property in the City, and have been pledged for such payment, within the limit prescribed by
law.
BY BECOMING the Registered Owner of this Bond, the Registered Owner thereby
acknowledges all of the terms and provisions of the Bond Ordinance, agrees to be bound by such
terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for
inspection in the official minutes and records of the governing body of the City, and agrees that the
terms and provisions of this Bond and the Bond Ordinance constitute a contract between each
Registered Owner hereof and the City.
IN WITNESS WHEREOF, the City has caused this Bond to be signed with the manual or
facsimile signature of the Mayor or Mayor Pro -tem of the City and countersigned with the manual
or facsimile signature of the City Secretary and has caused the official seal of the City to be duly
impressed, or placed in facsimile, on this Bond.
City Secretary
[CITY SEAL]
Mayor Pro -tem
FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
(To be executed if this Bond is not accompanied by an
executed Registration Certificate of the Comptroller
of Public Accounts of the State of Texas)
RR0MG0AnadgB-&2W4: o am -cm 12
It is hereby certified that this Bond has been issued under the provisions of the Bond
Ordinance described in the text of this Bond; and that this Bond has been issued in conversion or
replacement of, or in exchange for, a Bond, Bonds, or a portion of a Bond or Bonds of a Series which
originally was approved by the Attorney General of the State of Texas and registered by the
Comptroller of Public Accounts of the State of Texas.
Dated
JPMORGAN CHASE BANK
Paying Agent/Registrar
Authorized Representative
FORM OF ASSIGNMENT
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
Please insert Social Security or Taxpayer
Identification Number of Transferee
(Please print or typewrite name and address,
including zip code, of Transferee)
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
, attorney, to register the transfer ofthe within
Bond on the books kept for registration thereof, with full power of substitution in the premises.
Dated:
Signature Guaranteed:
RR0MCj0An&dgBon&2004: oral Cat 13
NOTICE: Signature(s) must be
guaranteed by a member firm of
the New York Stock Exchange or
a commercial bank or trust company.
NOTICE: The signature above
must correspond with the name
of the Registered Owner as it
appears upon the front of this
Bond in every particular, with-
out alteration or enlargement
or any change whatsoever.
FORM OF REGISTRATION CERTIFICATE OF
THE COMPTROLLER OF PUBLIC ACCOUNTS:
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO.
I hereby certify that this Bond has been examined, certified as to validity, and approved by
the Attorney General ofthe State of Texas, and that this Bond has been registered by the Comptroller
of Public Accounts of the State of Texas.
Witness my signature and seal this
Comptroller of Public Accounts
of the State of Texas
[COMPTROLLER'S SEAL]
INSERTIONS FOR THE INITIAL BOND
The initial Bond shall be in the form set forth in this Section, except that:
A. 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
"CUSIP NO." shall be deleted.
B. the first paragraph shall be deleted and the following will be inserted:
"ON THE MATURITY DATE SPECIFIED BELOW, the City of Round Rock, Texas
(the "City"), being a political subdivision, hereby promises to pay to the Registered Owner specified
above, or registered assigns (hereinafter called the "Registered Owner"), on August 15 in each of the
years, in the principal installments and bearing interest at the per annum rates set forth in the
following schedule:
RR0MQ0AndRdgBondc2009: OrdiCa 14
Years Principal Installments Interest Rates
(Information from Sections 2 and 3 to be inserted)
The City promises to pay interest on the unpaid principal amount hereof (calculated on the basis of
a 360 -day year of twelve 30 -day months) from July 15, 2004 at the respective Interest Rate per
annum specified above. Interest is payable on February 15, 2005 and semiannually on each August
15 and February 15 thereafter to the date of payment of the principal installment specified above;
except, that if this Bond is required to be authenticated and the date of its authentication is later than
the first Record Date (hereinafter defined), such principal amount shall bear interest from the interest
payment date next preceding the date of authentication, unless such date of authentication is after any
Record Date but on or before the next following interest payment date, in which case such principal
amount shall bear interest from such next following interest payment date; provided, however, that
if on the date of authentication hereof the interest on the Bond or Bonds, if any, for which this Bond
is being exchanged is due but has not been paid, then this Bond shall bear interest from the date to
which such interest has been paid in full."
C. The initial Bond shall be numbered "T-1."
Section 6. TAX LEVY. A special Interest and Sinking Fund (the "Interest and Sinking
Fund") is hereby created solely for the benefit of the Bonds, and the Interest and Sinking Fund shall
be established and maintained by the City at an official depository bank of the City. The Interest and
Sinking Fund shall be kept separate and apart from all other funds and accounts of the City, and shall
be used only for paying the interest on and principal of the Bonds. All ad valorem taxes levied and
collected for and on account of the Bonds shall be deposited, as collected, to the credit of the Interest
and Sinking Fund. During each year while any of the Bonds or interest thereon are outstanding and
unpaid, the governing body of the City shall compute and ascertain a rate and amount of ad valorem
tax which will be sufficient to raise and produce the money required to pay the interest on the Bonds
as such interest comes due, and to provide and maintain a sinking fund adequate to pay the principal
of the Bonds as such principal matures (but never less than 2% of the original principal amount of the
Bonds as a sinking fund each year); and the tax shall be based on the latest approved tax rolls of the
City, with full allowance being made for tax delinquencies and the cost of tax collection. The rate
and amount of ad valorem tax is hereby levied, and is hereby ordered to be levied, against all taxable
property in the City for each year while any of the Bonds or interest thereon are outstanding and
unpaid; and the tax shall be assessed and collected each such year and deposited to the credit of the
Interest and Sinking Fund. The ad valorem taxes sufficient to provide for the payment of the interest
on and principal of the Bonds, as such interest comes due and such principal matures, are hereby
pledged for such payment, within the limit prescribed by law. Accrued interest and any premium on
the Bonds shall be deposited in the Interest and Sinking Fund. Any such premium shall be used to
only pay principal of the Bonds.
Chapter 1208, Texas Government Code, applies to the issuance of the Bonds and the pledge
of the ad valorem taxes granted by the City under this Section, and is therefore valid, effective, and
perfected. If Texas law is amended at any time while the Bonds are outstanding and unpaid such that
RROCMGONnfftdgB.,W.2004: OrdinanceCat 15
the pledge of the ad valorem taxes granted by the City under this Section is to be subject to the filing
requirements of Chapter 9, Business & Commerce Code, then in order to preserve to the Owners of
the Bonds the perfection of the security interest in said pledge, the City agrees to take such measures
as it determines are reasonable and necessary under Texas law to comply with the applicable
provisions of Chapter 9, Business & Commerce Code and enable a filing to perfect the security
interest in said pledge to occur.
Section 7. ESTABLISHMENT OF PROJECT FUND AND ESCROW FUND. (a)
Project Fund. The Series 2004 Project Fund is hereby created and shall be established and maintained
by the City at an official depository bank of the City. Proceeds from the sale of the Bonds and
accrued interest, shall be deposited in the Project Fund.
(b) Investment of Funds. The City hereby covenants that the proceeds of the sale of the
Bonds will be used as soon as practicable for the purposes for which the Bonds are issued.
Obligations purchased as an investment of money in any fund shall be deemed to be a part of such
fund. Any money in any fund created by this Ordinance may be invested as permitted by the Public
Funds Investment Act, as amended and the City's Investment Policy.
(c) Security for Funds. All funds created by this Ordinance shall be secured in the manner
and to the fullest extent required by law for the security of funds of the City.
(d) Maintenance of Funds. Any funds created pursuant to this Ordinance may be created
as separate funds or accounts or as subaccounts of the City's General Fund held by the City's
depository, and, as such, not held in separate bank accounts, such treatment shall not constitute a
commingling of the monies in such funds or of such funds and the City shall keep full and complete
records indicating the monies and investments credited to each such fund.
(e) Escrow Fund. A portion of the proceeds of the Bonds, together with any cash
contribution, in an amount necessary to refund the Refunded Obligations shall be deposited in the
Escrow Fund created and governed by the terms of the Escrow Agreement dated July 15, 2004
attached hereto as Exhibit "A."
(f) Interest Earnings. Interest earnings derived from the investment of proceeds from the sale
of the Bonds shall be used along with the Bond proceeds for the purpose for which the Bonds are
issued as set forth in Section 1 hereof or to pay principal or interest payments on the Bonds; provided
that after completion of such purpose, if any of such interest earnings remain on hand, such interest
earnings shall be deposited in the Interest and Sinking Fund. It is further provided, however, that any
interest earnings on bond proceeds which are required to be rebated to the United States of America
pursuant to Section 11 hereof in order to prevent the Bonds from being arbitrage bonds shall be so
rebated and not considered as interest earnings for the purposes of this Section.
Section 8. DEFEASANCE OF BONDS. (a) Any Bond and the interest thereon shall be
deemed to be paid, retired and no longer outstanding (a "Defeased Bond") within the meaning of this
Ordinance, except to the extent provided in subsections (c) and (e) of this Section, when payment of
RR0CKK70AndRdgBondc2M4: Orli-Ce 16
the principal of such Bond, plus interest thereon to the due date or dates (whether such due date or
dates be by reason of maturity, upon redemption, or otherwise) either (i) shall have been made or
caused to be made in accordance with the terms thereof (including the giving of any required notice
of redemption) or (ii) shall have been provided for on or before such due date by irrevocably
depositing with or making available to the Paying Agent/Registrar or a commercial bank or trust
company for such payment (1) lawful money of the United States of America sufficient to make such
payment, (2) Defeasance Securities, certified by an independent public accounting firm of national
reputation to mature as to principal and interest in such amounts and at such times as will ensure the
availability, without reinvestment, of sufficient money to provide for such payment and when proper
arrangements have been made by the City with the Paying Agent/Registrar or a commercial bank or
trust company for the payment of its services until all Defeased Bonds shall have become due and
payable or (3) any combination of (1) and (2). At such time as a Bond shall be deemed to be a
Defeased Bond hereunder, as aforesaid, such Bond and the interest thereon shall no longer be secured
by, payable from, or entitled to the benefits of, the ad valorem taxes herein levied as provided in this
Ordinance, and such principal and interest shall be payable solely from such money or Defeasance
Securities.
(b) The deposit under clause (ii) of subsection (a) shall be deemed a payment of a Bond as
aforesaid when proper notice of redemption of such Bonds shall have been given, in accordance with
this Ordinance. Any money so deposited with the Paying Agent/Registrar or a commercial bank or
trust company as provided in this Section may at the discretion of the City Council also be invested
in Defeasance Securities, maturing in the amounts and at the times as hereinbefore set forth, and all
income from all Defeasance Securities in possession of the Paying Agent/Registrar or a commercial
bank or trust company pursuant to this Section which is not required for the payment of such Bond
and premium, if any, and interest thereon with respect to which such money has been so deposited,
shall be turned over to the City Council.
(c) Notwithstanding any provision of any other Section of this Ordinance which may be
contrary to the provisions of this Section, all money or Defeasance Securities set aside and held in
trust pursuant to the provisions of this Section for the payment of principal of the Bonds and
premium, if any, and interest thereon, shall be applied to and used solely for the payment of the
particular Bonds and premium, if any, and interest thereon, with respect to which such money or
Defeasance Securities have been so set aside in trust. Until all Defeased Bonds shall have become
due and payable, the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for
such Defeased Bonds the same as if they had not been defeased, and the City shall make proper
arrangements to provide and pay for such services as required by this Ordinance.
(d) Notwithstanding anything elsewhere in this Ordinance, if money or Defeasance Securities
have been deposited or set aside with the Paying Agent/Registrar or a commercial bank or trust
company pursuant to this Section for the payment of Bonds and such Bonds shall not have in fact
been actually paid in full, no amendment of the provisions of this Section shall be made without the
consent of the registered owner of each Bond affected thereby.
(e) Notwithstanding the provisions of subsection (a) immediately above, to the extent that,
upon the defeasance of any Defeased Bond to be paid at its maturity, the City retains the right under
RR0CK\G0MdRdgBon&2004: Ordin ceCct 17
Texas law to later call that Defeased Bond for redemption in accordance with the provisions of the
Ordinance authorizing its issuance, the City may call such Defeased Bond for redemption upon
complying with the provisions of Texas law and upon the satisfaction of the provisions of subsection
(a) immediately above with respect to such Defeased Bond as though it was being defeased at the
time of the exercise of the option to redeem the Defeased Bond and the effect of the redemption is
taken into account in determining the sufficiency of the provisions made for the payment of the
Defeased Bond.
As used in this section, Defeasance Securities means (i) Federal Securities, (ii) noncallable
obligations of an agency or instrumentality of the United States of America, including obligations that
are unconditionally guaranteed or insured by the agency or instrumentality and that, on the date the
City Council adopts or approves proceedings authorizing the issuance of refunding bonds or
otherwise provide for the funding of an escrow to effect the defeasance of the Bonds are rated as to
investment quality by a nationally recognized investment rating firm not less than "AAA" or its
equivalent, and (iii) noncallable obligations of a state or an agency or a City, municipality, or other
political subdivision of a state that have been refunded and that, on the date the City Council adopts
or approves proceedings authorizing the issuance of refunding bonds or otherwise provide for the
funding of an escrow to effect the defeasance of the Bonds, are rated as to investment quality by a
nationally recognized investment rating firm no less than "AAA" or its equivalent. "Federal
Securities" as used herein means direct, noncallable obligations of the United States of America,
including obligations that are unconditionally guaranteed by the United States of America (including
Interest Strips of the Resolution Funding Corporation).
Section 9. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS.
(a) Replacement Bonds. In the event any outstanding Bond is damaged, mutilated, lost, stolen, or
destroyed, the Paying Agent/Registrar shall cause to be printed, executed, and delivered, a new Bond
of the same principal amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or
destroyed Bond, in replacement for such Bond in the manner hereinafter provided.
(b) Application for Replacement Bonds. Application for replacement of damaged, mutilated,
lost, stolen, or destroyed Bonds shall be made by the Registered Owner thereof to the Paying
Agent/Registrar. In every case of loss, theft, or destruction of a Bond, the Registered Owner
applying for a replacement bond shall furnish to the City and to the Paying Agent/Registrar such
security or indemnity as may be required by them to save each of them harmless from any loss or
damage with respect thereto. Also, in every case of loss, theft, or destruction of a Bond, the
Registered Owner shall furnish to the City and to the Paying Agent/Registrar evidence to their
satisfaction of the loss, theft, or destruction of such Bond, as the case may be. In every case of
damage or mutilation of a Bond, the Registered Owner shall surrender to the Paying Agent/Registrar
for cancellation the Bond so damaged or mutilated.
(c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the
event any such Bond shall have matured, and no default has occurred which is then continuing in the
payment of the principal of, redemption premium, if any, or interest on the Bond, the City may
authorize the payment of the same (without surrender thereof except in the case of a damaged or
RR0MG0MdtdgBmWr20N:OrdinaiceCe t 18
mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished
as above provided in this Section.
(d) Chafe for Issuing Replacement Bonds. Prior to the issuance of any replacement Bond,
the Paying Agent/Registrar shall charge the Registered Owner of such Bond with all legal, printing,
and other expenses in connection therewith. Every replacement Bond issued pursuant to the
provisions of this Section by virtue of the fact that any Bond is lost, stolen, or destroyed shall
constitute a contractual obligation of the City whether or not the lost, stolen, or destroyed Bond shall
be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this
Ordinance equally and proportionately with any and all other Bonds duly issued under this Ordinance.
(e) Authority for Issuing_ Replacement Bonds. In accordance with Subchapter B of Texas
Government Code, Chapter 1206, this Section of this Ordinance shall constitute authority for the
issuance of any such replacement Bond without necessity of further action by the governing body of
the City or any other body or person, and the duty of the replacement of such Bonds is hereby
authorized and imposed upon the Paying Agent/Registrar, and the Paying Agent/Registrar shall
authenticate and deliver such Bonds in the form and manner and with the effect, as provided in
Section 4(a) of this Ordinance for Bonds issued in conversion and exchange for other Bonds.
Section 10. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND
COUNSEL'S OPINION• CUSIP NUMBERS AND CONTINGENT INSURANCE
PROVISION, IF OBTAINED. The Mayor of the City is hereby authorized to have control of the
Bonds initially issued and delivered hereunder and all necessary records and proceedings pertaining
to the Bonds pending their delivery and their investigation, examination, and approval by the Attorney
General of the State of Texas, and their registration by the Comptroller of Public Accounts of the
State of Texas. Upon registration of the Bonds the Comptroller of Public Accounts (or a deputy
designated in writing to act for the Comptroller) shall manually sign the Comptroller's Registration
Certificate attached to such Bonds, and the seal of the Comptroller shall be impressed, or placed in
facsimile, on such Certificate. The approving legal opinion of the City's Bond Counsel and the
assigned CUSIP numbers may, at the option ofthe City, be printed on the Bonds issued and delivered
under this Ordinance, but neither shall have any legal effect, and shall be solely for the convenience
and information ofthe Registered Owners of the Bonds. In addition, if bond insurance or other credit
enhancement is obtained, the Bonds may bear an appropriate legend.
Section 11. COVENANTS REGARDING TAX EXEMPTION OF INTEREST ON
THE BONDS. (a) Covenants. The City covenants to take any action necessary to assure, or refrain
from any action which would adversely affect, the treatment of the Bonds as obligations described
in section 103 of the Internal Revenue Code of 1986, as amended (the "Code"), the interest on which
is not includable in the "gross income" of the holder for purposes of federal income taxation. In
furtherance thereof, the City covenants as follows:
(1) to take any action to assure that no more than 10 percent of the proceeds of the
Bonds or the projects financed therewith (less amounts deposited to a reserve fund, if any)
are used for any "private business use," as defined in section 141(b)(6) of the Code or, if more
RR0MG0NAtdgBm.h2004: Or&n—Cat 19
than 10 percent of the proceeds or the projects financed therewith are so used, such amounts,
whether or not received by the City, with respect to such private business use, do not, under
the terms of this Ordinance or any underlying arrangement, directly or indirectly, secure or
provide for the payment of more than 10 percent of the debt service on the Bonds, in
contravention of section 141(b)(2) of the Code;
(2) to take any action to assure that in the event that the "private business use"
described in subsection (1) hereof exceeds 5 percent of the proceeds of the Bonds or the
projects financed therewith (less amounts deposited into a reserve fund, if any) then the
amount in excess of 5 percent is used for a "private business use" which is "related" and not
"disproportionate," within the meaning of section 141(b)(3) ofthe Code, to the governmental
use;
(3) to take any action to assure that no amount which is greater than the lesser of
$5,000,000, or 5 percent of the proceeds of the Bonds (less amounts deposited into a reserve
fund, if any) is directly or indirectly used to finance loans to persons, other than state or local
governmental units, in contravention of section 141(c) of the Code;
(4) to refrain from taking any action which would otherwise result in the Bonds being
treated as "private activity bonds" within the meaning of section 141(b) of the Code;
(5) to refrain from taking any action that would result in the Bonds being "federally
guaranteed" within the meaning of section 149(b) of the Code;
(6) to refrain from using any portion of the proceeds of the Bonds, directly or
indirectly, to acquire or to replace funds which were used, directly or indirectly, to acquire
investment property (as defined in section 148(b)(2) ofthe Code) which produces a materially
higher yield over the term of the Bonds, other than investment property acquired with --
(A) proceeds of the Bonds invested for a reasonable temporary period of 3
years or less or, in the case of a refunding bond, for a period of 90 days or less until
such proceeds are needed for the purpose for which the bonds are issued,
(B) amounts invested in a bona fide debt service fund, within the meaning of
section 1.148-1(b) of the Treasury Regulations, and
(C) amounts deposited in any reasonably required reserve or replacement fund
to the extent such amounts do not exceed 10 percent of the proceeds of the Bonds;
(7) to otherwise restrict the use of the proceeds of the Bonds or amounts treated as
proceeds of the Bonds, as may be necessary, so that the Bonds do not otherwise contravene
the requirements of section 148 of the Code (relating to arbitrage) and, to the extent
applicable, section 149(d) of the Code (relating to advance refundings); and
RR0MG0AnAldgBondd004: Orch-Cat 20
(8) to pay to the United States of America at least once during each five-year period
(beginning on the date of delivery of the Bonds) an amount that is at least equal to 90 percent
of the "Excess Earnings," within the meaning of section 148(0 of the Code and to pay to the
United States of America, not later than 60 days after the Bonds have been paid in full, 100
percent of the amount then required to be paid as a result of Excess Earnings under section
148(f) of the Code.
(b) Rebate Fund. In order to facilitate compliance with the above covenant (8), a "Rebate
Fund" is hereby established by the City for the sole benefit of the United States of America, and such
fund shall not be subject to the claim of any other person, including without limitation the
bondholders. The Rebate Fund is established for the additional purpose of compliance with section
148 of the Code.
(c) Proceeds. The City understands that the term "proceeds" includes "disposition proceeds"
as defined in the Treasury Regulations and, in the case of refunding bonds, transferred proceeds (if
any) and proceeds of the refunded bonds expended prior to the date of issuance of the Bonds. It is
the understanding of the City that the covenants contained herein are intended to assure compliance
with the Code and any regulations or rulings promulgated by the U.S. Department of the Treasury
pursuant thereto. In the event that regulations or rulings are hereafter promulgated which modify or
expand provisions of the Code, as applicable to the Bonds, the City will not be required to comply
with any covenant contained herein to the extent that such failure to comply, in the opinion of
nationally recognized bond counsel, will not adversely affect the exemption from federal income
taxation of interest on the Bonds under section 103 of the Code. In the event that regulations or
rulings are hereafter promulgated which impose additional requirements which are applicable to the
Bonds, the City agrees to comply with the additional requirements to the extent necessary, in the
opinion of nationally recognized bond counsel, to preserve the exemption from federal income
taxation of interest on the Bonds under section 103 of the Code. In furtherance of such intention,
the City hereby authorizes and directs the City Manager or Director of Finance to execute any
documents, certificates or reports required by the Code and to make such elections, on behalf of the
City, which may be permitted by the Code as are consistent with the purpose for the issuance of the
Bonds.
(d) Allocation Of. and Limitation On Expenditures for the Project. The City covenants to
account for the expenditure of sale proceeds and investment earnings to be used for the purposes
described in Section 1 of this Ordinance (the 'Project") on its books and records in accordance with
the requirements of the Internal Revenue Code. The City recognizes that in order for the proceeds
to be considered used for the reimbursement of costs, the proceeds must be allocated to expenditures
within 18 months of the later of the date that (1) the expenditure is made, or (2) the Project is
completed; but in no event later than three years after the date on which the original expenditure is
paid. The foregoing notwithstanding, the City recognizes that in order for proceeds to be expended
under the Internal Revenue Code, the sale proceeds or investment earnings must be expended no
more than 60 days after the earlier of (1) the fifth anniversary of the delivery of the Bonds, or (2) the
date the Bonds are retired. The City agrees to obtain the advice of nationally -recognized bond counsel
if such expenditure fails to comply with the foregoing to assure that such expenditure will not
adversely affect the tax-exempt status of the Bonds. For purposes hereof, the City shall not be
RR0CK\G0ArWRefgBon&2004: Ordin n Ca 21
obligated to comply with this covenant if it obtains an opinion that such failure to comply will not
adversely affect the excludability for federal income tax purposes from gross income of the interest.
(e) Disposition of Project. The City covenants that the property constituting the Project will
not be sold or otherwise disposed in a transaction resulting in the receipt by the City of cash or other
compensation, unless the City obtains an opinion of nationally -recognized bond counsel that such sale
or other disposition will not adversely affect the tax-exempt status of the Bonds. For purposes of the
foregoing, the portion of the property comprising personal property and disposed in the ordinary
course shall not be treated as a transaction resulting in the receipt of cash or other compensation. For
purposes hereof, the City shall not be obligated to comply with this covenant if it obtains an opinion
that such failure to comply will not adversely affect the excludability for federal income tax purposes
from gross income of the interest.
Section 12. SALE OF BONDS. The Bonds are hereby sold and shall be delivered to RBC
Dain Rauscher as the senior managing underwriter on behalf of itself and the other underwriters as
set forth in the Purchase Agreement, (collectively, the "Underwriters") in accordance with the terms
and provisions of a Purchase Agreement in substantially the form attached hereto as Exhibit "B"
which the Mayor and Mayor Pro -Tem of the City are hereby authorized to execute and deliver and
which the City Secretary of the City is hereby authorized to attest. The City will initially deliver to
the Underwriters the Bonds authorized under this Ordinance. The Bonds shall initially be registered
in the name of RBC Dain Rauscher.
Section 13. APPROVAL OF OFFICIAL STATEMENT. The City hereby approves the
form and content of the Official Statement relating to the Bonds and any addenda, supplement or
amendment thereto, and approves the distribution of such Official Statement in the reoffering of the
Bonds by the Underwriters in final form, with such changes therein or additions thereto as the officer
executing the same may deem advisable, such determination to be conclusively evidenced by his
execution thereof. The distribution and use ofthe Preliminary Official Statement dated June 16, 2004
prior to the date hereof is confirmed, approved and ratified. The City Council hereby finds and
determines that the Preliminary Official Statement and final Official Statement were "deemed final"
(as that term is defined in 17 CFR Section 240.15c(2)-12) as of their respective dates.
Section 14. APPROVAL OF ESCROW AGREEMENT AND TRANSFER OF FUNDS.
The Mayor or Mayor Pro -tem of the City is hereby authorized and directed to execute and deliver
and the City Secretary of the City is hereby authorized and directed to attest an Escrow Agreement
in substantially the form attached hereto as Exhibit "A". In addition, the Mayor and Director of
Finance are each hereby authorized to execute such subscriptions or other documentation for the
purchase of United States Treasury Securities, and to authorize the transfer of such funds of the City,
as may be necessary for the Escrow Fund.
Section 15. APPROVAL OF PAYING AGENT/REGISTRAR AGREEMENT. Attached
hereto as Exhibit "C" is a substantially final form of Paying Agent/Registrar Agreement. The Mayor
or Mayor Pro -tem is hereby authorized to amend, complete or modify such agreement as necessary
xx0MWAraLe%Bwds20N: omin—c.e 22
and are further authorized to execute such agreement and the City Secretary is hereby authorized to
attest such agreement.
Section 16. NOTICES OF REDEMPTION. Attached to this Ordinance, as Exhibit "D",
and made a part hereof for all purposes, are copies of notices of deposit and prior redemption for the
Refunded Obligations in substantially final form and such Refunded Obligations described in said
notices of prior redemption are hereby called for redemption and shall be redeemed prior to maturity
on the dates, places, and at the prices set forth therein. The Mayor and Director of Finance are each
hereby authorized to amend, complete or modify such notices as necessary to call such Refunded
Obligations for redemption.
Section 17. NOTICE TO PAYING AGENT. The Refunded Obligations described in
Exhibit "D" attached hereto are so called for redemption, and the respective paying agents for the
Refunded Obligations are hereby directed to make appropriate arrangements so that such Refunded
Bonds may be redeemed on the respective redemption dates. A copy of such notice of redemption
shall be delivered to the respective paying agents so mentioned in the notices.
Section 18. CONTINUING DISCLOSURE UNDERTAKING. (a) Annual Reports. The
City shall provide annually to each NRMSIR and any SID, within six 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 authorized by Section 13 of this Ordinance, being the
information described in Exhibit "E" hereto. Any financial statements so to be provided shall be (1)
prepared in accordance with the accounting principles described in Exhibit "E" hereto, or such other
accounting principles as the City may be required to employ from time to time pursuant to state law
or regulation, and (2) 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 unaudited financial
statements within the required time period and audited financial statements for the applicable fiscal
year to each NRMSIR and any SID, when and if the audit report on such statements become
available.
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.
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 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.
(b) Material Event Notices. 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:
RR0MG0MdRdgBmWs2004: Orft—Cat 23
A. Principal and interest payment delinquencies;
B. Non-payment related defaults;
C. Unscheduled draws on debt service reserves reflecting financial difficulties;
D. Unscheduled draws on credit enhancements reflecting financial difficulties;
E. Substitution of credit or liquidity providers, or their failure to perform;
F. Adverse tax opinions or events affecting the tax-exempt status of the Bonds;
G. Modifications to rights of holders of the Bonds;
H. Bond calls;
I. Defeasances;
Release, substitution, or sale ofproperty securing repayment ofthe Bonds; and
K. Rating changes.
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 this
Section of this Ordinance by the time required by such Section.
(c) Limitations Disclaimers, and Amendments. The City shall be obligated to observe and
perform the covenants specified in this Section for so long as, but only for so long as, the City
remains an "obligated person" with respect to the Bonds within the meaning of the Rule, except that
the City in any event will give notice of any deposit made in accordance with Section 8 that causes
the Bonds no longer to be outstanding.
The provisions of this Section are for the sole benefit of the holders and beneficial owners of
the Bonds, and nothing in this Section, express or implied, shall give any benefit or any legal or
equitable right, remedy, or claim hereunder to any other person. The City undertakes to provide only
the financial information, operating data, financial statements, and notices which it has expressly
agreed to provide pursuant to this Section and does not hereby undertake to provide any other
information that may be relevant or material to a complete presentation of the City's financial results,
condition, or prospects or hereby undertake to update any information provided in accordance with
this Section or otherwise, except as expressly provided herein. The City does not make any
representation or warranty concerning such information or its usefulness to a decision to invest in or
sell Bonds at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR
BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT,
RR0MG0MAteege«n&2004: aaiec n 24
FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE CITY,
WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT
SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND REMEDY OF ANY SUCH
PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH
SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE.
No default by the City in observing or performing its obligations under this Section shall
comprise a breach of or default under the Ordinance for purposes of any other provision of this
Ordinance.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the duties
of the City under federal and state securities laws.
The provisions of this Section may be amended by the City from time to time to adapt to
changed circumstances that arise from a change in legal requirements, a change in law, or a change
in the identity, nature, status, or type of operations of the City, but only if (1) the provisions of this
Section, 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 since such offering as well as such changed circumstances and (2) either
(a) the holders of a majority in aggregate principal amount (or any greater amount required by any
other provision of this Ordinance that authorizes such an amendment) of the outstanding Bonds
consents to such amendment or (b) a person that is unaffiliated with the City (such as nationally
recognized bond counsel) determines that such amendment will not materially impair the interest of
the holders and beneficial owners of the Bonds. If the City so amends the provisions of this Section,
it shall include with any amended financial information or operating data next provided in accordance
with this Section an explanation, in narrative form, of the reason for the amendment and of the impact
of any change in the type of financial information or operating data so provided. The City may also
amend or repeal the provisions of this continuing disclosure agreement if the SEC amends or repeals
the applicable provision of the Rule or a court of final jurisdiction enters judgment that such
provisions of the Rule are invalid, but only if and to the extent that the provisions of this sentence
would not prevent an underwriter from lawfully purchasing or selling Bonds in the primary offering
of the Bonds.
(d) Definitions. As used in this Section, the following terms have the meanings ascribed
to such terms below:
"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 ofthe Rule from
time to time.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
RR0MG0AnAefgBon&2004: OrdimnceCe n 25
"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.
Section 19. AMENDMENT OF ORDINANCE. The City hereby reserves the right to
amend this Ordinance subject to the following terms and conditions, to -wit:
(a) The City may from time to time, without the consent of any holder, except as otherwise
required by paragraph (b) below, amend or supplement this Ordinance in order to (i) cure any
ambiguity, defect or omission in this Ordinance that does not materially adversely affect the interests
of the holders, (ii) grant additional rights or security for the benefit of the holders, (iii) add events of
default as shall not be inconsistent with the provisions of this Ordinance and that shall not materially
adversely affect the interests of the holders, (iv) qualify this Ordinance under the Trust Indenture Act
of 1939, as amended, or corresponding provisions of federal laws from time to time in effect, (v)
obtain insurance or ratings on the Bonds, (vi) obtain the approval of the Attorney General ofthe State
Texas, or (vii) make such other provisions in regard to matters or questions arising under this
Ordinance as shall not be inconsistent with the provisions of this Ordinance and that shall not in the
opinion of the City's Bond Counsel materially adversely affect the interests of the holders.
(b) Except as provided in paragraph (a) above, the holders of Bonds aggregating in
principal amount 51% of the aggregate principal amount of then outstanding Bonds that are the
subject of a proposed amendment shall have the right from time to time to approve any amendment
hereto that may be deemed necessary or desirable by the City; provided, however, that without the
consent of 100% of the holders in aggregate principal amount of the then outstanding Bonds, nothing
herein contained shall permit or be construed to permit amendment of the terms and conditions of this
Ordinance or in any of the Bonds so as to:
(1) Make any change in the maturity of any of the outstanding Bonds;
(2) Reduce the rate of interest borne by any of the outstanding Bonds;
(3) Reduce the amount of the principal of, or redemption premium, if any, payable
on any outstanding Bonds;
(4) Modify the terms of payment of principal or of interest or redemption premium
on outstanding Bonds or any of them or impose any condition with respect to such
payment; or
(5) Change the minimum percentage of the principal amount of any series of
Bonds necessary for consent to such amendment.
(c) If at any time the City shall desire to amend this Ordinance under this Section, the City
shall send by U.S. mail to each registered owner of the affected Bonds a copy of the proposed
amendment and cause notice of the proposed amendment to be published at least once in a financial
nxoc[\co,ndccegnoam.xooa: oraincm 26
publication published in The City of New York, New York or in the State of Texas. Such published
notice shall briefly set forth the nature of the proposed amendment and shall state that a copy thereof
is on file at the office of the City for inspection by all holders of such Bonds.
(d) Whenever at any time within one year from the date of publication of such notice the
City shall receive an instrument or instruments executed by the holders of at least 51 % in aggregate
principal amount of all of the Bonds then outstanding that are required for the amendment, which
instrument or instruments shall refer to the proposed amendment and that shall specifically consent
to and approve such amendment, the City may adopt the amendment in substantially the same form.
(e) Upon the adoption of any amendatory Ordinance pursuant to the provisions of this
Section, this Ordinance shall be deemed to be modified and amended in accordance with such
amendatory Ordinance, and the respective rights, duties, and obligations of the City and all holders
of such affected Bonds shall thereafter be determined, exercised, and enforced, subject in all respects
to such amendment.
(f) Any consent given by the holder of a Bond pursuant to the provisions of this Section
shall be irrevocable for a period of six months from the date of the publication of the notice provided
for in this Section, and shall be conclusive and binding upon all future holders of the same Bond
during such period. Such consent may be revoked at any time after six months from the date of the
publication of said notice by the holder who gave such consent, or by a successor in title, by filing
notice with the City, but such revocation shall not be effective if the holders of 51% in aggregate
principal amount of the affected Bonds then outstanding, have, prior to the attempted revocation,
consented to and approved the amendment.
Section 20. REMEDIES IN EVENT OF DEFAULT. In addition to all the rights and
remedies provided by the laws of the State of Texas, it is specifically covenanted and agreed
particularly that in the event the City (i) defaults in the payment of the principal, premium, if any, or
interest on the Bonds, (ii) declares bankruptcy, or (iii) defaults in the observance or performance of
any other ofthe covenant, agreement or obligation ofthe City, the failure to perform which materially
adversely affects the rights of the owners, including but no limited to, their prospect or ability to be
repaid in accordance with this Section and the continuation thereof for a period of 60 days after
notice of such default is given by any owner to the City, the following remedies shall be available:
(a) 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 to 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 the Bonds then outstanding.
RR0CKMArdtdgBm&2004: OrdinmccCat 2
(c) The bond insurer, if any, shall be deemed to be the sole holder of the Bonds for the
purpose of exercising any voting right or privilege or giving any consent or direction or taking any
other action that the owners of the Bonds are entitled to take.
(d) 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.
The exercise of any remedy herein conferred or reserved shall not be deemed a waiver of any other
available remedy.
Section 21. ADDITIONAL BOND INSURANCE PROVISIONS. Bond Counsel is
authorized to insert provisions, if any, required by the bond insurer and agreed to by the City and the
City Attorney.
Section 22. NO RECOURSE AGAINST CITY OFFICIALS. No recourse shall be had
for the payment of principal of or interest on the Bonds or for any claim based thereon or on this
Ordinance against any official of the City or any person executing any Bonds.
Section 23. FURTHER ACTIONS. The officers and employees of the City are hereby
authorized, empowered and directed from time to time and at any time to do and perform all such
acts and things and to execute, acknowledge and deliver in the name and under the corporate seal and
on behalf of the City all such instruments, whether or not herein mentioned, as may be necessary or
desirable in order to carry out the terms and provisions of this Ordinance, the Bonds, the initial sale
and delivery ofthe Bonds, the Paying Agent/Registrar Agreement, the Bond Purchase Agreement and
the Official Statement. In addition, prior to the initial delivery of the Bonds, the Mayor, is hereby
authorized and directed to approve any changes or corrections to this Ordinance or to any of the
instruments authorized and approved by this Ordinance necessary in order to (i) correct any ambiguity
or mistake or properly or more completely document the transactions contemplated and approved
by this Ordinance and as described in the Official Statement or (ii) obtain the approval of the Bonds
by the Texas Attorney General's office.
In case any officer of the City whose signature shall appear on any Bond shall cease to be such
officer before the delivery of such Bond, such signature shall nevertheless be valid and sufficient for
all purposes the same as if such officer had remained in office until such delivery.
Section 24. INTERPRETATIONS. All terms defined herein and all pronouns used in this
Ordinance shall be deemed to apply equally to singular and plural and to all genders. The titles and
headings ofthe articles and sections ofthis Ordinance have been inserted for convenience of reference
only and are not to be considered a part hereof and shall not in any way modify or restrict any of the
terms or provisions hereof. This Ordinance and all the terms and provisions hereof shall be liberally
construed to effectuate the purposes set forth herein and to sustain the validity of the Bonds and the
validity of the lien on and pledge to secure the payment of the Bonds.
RR0MC,0MdRdgBwcb2004: Ordi-Ca 28
Section 25. INCONSISTENT PROVISIONS. All ordinances, orders or resolutions, or
parts thereof, which are in conflict or inconsistent with any provisions of this Ordinance are hereby
repealed to the extent of such conflict and the provisions of this Ordinance shall be and remain
controlling as to the matters contained herein.
Section 26. INTERESTED PARTIES. Nothing in this Ordinance expressed or implied is
intended or shall be construed to confer upon, or to give to, any person or entity, other than the City
and the registered owners of the Bonds, any right, remedy or claim under or by reason of this
Ordinance or any covenant, condition or stipulation hereof, and all covenants, stipulations, promises
and agreements in this Ordinance contained by and on behalf of the City shall be for the sole and
exclusive benefit of the City and the registered owners of the Bonds.
Section 27. SEVERABILITY. The provisions of this Ordinance are severable; and in case
any one or more of the provisions of this Ordinance or the application thereof to any person or
circumstance should be held to be invalid, unconstitutional, or ineffective as to any person or
circumstance, the remainder of this Ordinance nevertheless shall be valid, and the application of any
such invalid provision to persons or circumstances other than those as to which it is held invalid shall
not be affected thereby.
,Rom, naeWo &2004: adin—Cat 29
IN ACCORDANCE WITH SECTION 1201.028, Texas Government Code, passed and
approved on the first and final reading on the 22nd day of July, 2004.
Alan McGraw, Mayor Pro -tem
City of Round Rock, Texas
ATTEST:
Christine Martinez, City Secretary
,R0MG0H„adfSB- .2W4: ad—,C.1 ExecutionPgOrdinance
EXHIBIT A
ESCROW AGREEMENT
RROCK\GOAn&cfgBorWs20O4: Or& -Ca A-1
I* I:
PURCHASE AGREEMENT
RROCK\GOM&idgBon&2004: OrdinnceCc D-1
EXHIBIT C
PAYING AGENUREGISTRAR AGREEMENT
RROCK\GOMAtdgBrndR004: Ordi—Cat C-1
EXHIBIT D
NOTICES OF REDEMPTION
NOTICE OF DEFEASANCE/REDEMPTION
NOTICE IS HEREBY GIVEN that Round Rock, Texas (the "City") has deposited cash and
United States government securities in escrow to defease, and has further called for redemption, a
portion of the following obligations of the City (the "Obligations"):
CITY OF ROUND ROCK, TEXAS
COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION,
SERIES 1995
Maturity
Redemption
Principal
Interest
CUSIP
June 1
Date
Amount
Rate
Number*
2006
June 1, 2005
$185,000
5.400%
779222 QC 5
2007
June 1, 2005
195,000
5.500
779222 QD 3
2008
June 1, 2005
205,000
5.600
779222 QE 1
2009
June 1, 2005
215,000
5.700
779222 QF 8
2010
June 1, 2005
230,000
5.800
779222 QG 6
2011
June 1, 2005
240,000
5.900
779222 QH 4
*The CUSIP Numbers have been assigned to this issue by the CUSIP Service Bureau and are included solely for the convenience of the owners of the Bonds. The City shall not be responsible for
the selection or the correctness of the CUSIP numbers set forth herein.
The redemption price for the above Obligations is par plus accrued interest to the date fixed
for redemption. Such Bonds shall be redeemed and shall not longer bear interest after the redemption
date. Due provision for the payment of the obligations described above has been made with The
Bank ofNew York Trust Company, N.A. (the "Bank"), the paying agent for said obligations, and said
obligations shall be presented for payment either in person or by mail, at the following address:
BY MAIL: HAND DELIVERY:
The Bank of New York The Bank of New York
111 Sanders Creek Parkway 111 Sanders Creek Parkway
East Syracuse, NY 13057 East Syracuse, NY 13057
Attn: Helen Scanlon Attn: Helen Scanlon
In compliance with section 3406 of the Internal Revenue Code of 1986, as amended, payors
making certain payments due on debt securities may be obligated to deduct and withhold 28% of such
payment from the remittance to any payee who has failed to provide such payor with a valid taxpayer
identification number. To avoid the imposition of this withholding tax, such payees should submit
a certified taxpayer identification number when surrendering the Bonds for redemption.
RR0MC,0ArWRdgBwW+2004: Ordin—.Ca D-1
NOTICE OF DEFEASANCE/REDEMPTION
NOTICE IS HEREBY GIVEN that Round Rock, Texas (the "City") has deposited cash
and United States government securities in escrow to defease, and has further called for redemption,
a portion of the following obligations of the City (the 'Bonds"):
CITY OF ROUND ROCK, TEXAS
GENERAL OBLIGATION AND REFUNDING BONDS,
SERIES 1996
Maturity Redemption Principal Interest CUSIP
August 15 Date Amount Rate Number*
2007
August 15, 2006
$ 105,000
5.200%
779222 QT 8
2009
August 15, 2006
315,000
5.375
779222 QV 3
2010
August 15, 2006
525,000
5.500
779222 QW 1
2011
August 15, 2006
650,000
5.600
779222 QX 9
2012
August 15, 2006
685,000
5.625
779222 QY 7
2013
August 15, 2006
725,000
5.650
779222 QZ 4
2014
August 15, 2006
800,000
5.650
779222 RA 8
2015
August 15, 2006
850,000
5.700
779222 RB 6
2016
August 15, 2006
895,000
5.700
779222 RC 4
2021
August 15, 2006
5,295,000
5.800
779222 RH 3
-The CUSIP Numbers have been assigned to this issue by the CUSIP Service Bureau and are included solely for the convenience of the owners of the Bonds. The City shall not be responsible for
the selection or the correctness of the CUSIP numbers set forth herein.
The redemption price for the above Bonds is par plus accrued interest to the date fixed for
redemption. Such Bonds shall be redeemed and shall not longer bear interest after the redemption
date. The redemption price for such Bonds shall be paid upon presentation to JPMorgan Chase Bank,
the Paying Agent, at its principal payment office in Dallas, Texas.
First Class/Registered/Certified Mail By Ovemikht or Courier By Hand
JP Morgan Chase Bank JPMorgan Chase Bank JPMorgan Chase Bank
Institutional Trust Services Institutional Trust Services GIS Unit Trust Window
P.O. Box 2320 2001 Bryan Street, 9ti' Floor 4 New York Plaza, 1st Floor
Dallas, Texas 75221-2320 Dallas, Texas 75201 New York, NY 10004
In compliance with section 3406 of the Internal Revenue Code of 1986, as amended, payors
making certain payments due on debt securities may be obligated to deduct and withhold 28% of such
payment from the remittance to any payee who has failed to provide such payor with a valid taxpayer
identification number. To avoid the imposition of this withholding tax, such payees should submit
a certified taxpayer identification number when surrendering the Bonds for redemption.
RROCKMArdtdgBondo2004: OrdinameCat D -L
EXHIBIT E
DESCRIPTION OF ANNUAL FINANCIAL INFORMATION
The following information is referred to in Section 15 of this Ordinance.
Annual Financial Statements and Operating Data
The financial information and operating data with respect to the City to be provided annually
in accordance with such Section are as specified (and included in the Appendix or under the headings
of the Official Statement referred to) below:
(1)
Appendix B -
Excerpts from Annual Financial Report;
(2)
Table 1-
Valuation, Exemptions and General Obligation Debt;
(3)
Table 2 -
Taxable Assessed Valuation by Category;
(4)
Table 3 -
Valuation and General Obligation Debt History;
(5)
Table 4 -
Tax Rate, Levy and Collection History,
(6)
Table 5 -
Ten Largest Taxpayers;
(7)
Table 7 -
Pro -Forma General Obligation Debt Service Requirements;
(8)
Table 8 -
Interest and Sinking Fund Budget Projection;
(8)
Table 9 -
Authorized But Unissued General Obligation Bonds;
(9)
Table 10 -
General Fund Revenues and Expenditure History; and
(10)
Table 11 -
Current Investments.
Accounting Principles
The accounting principles referred to in such Section are the accounting principles described
in the notes to the financial statements referred to in the paragraph above.
RRCmMC,0Andtd'gaad2004: oras Cat E-1
$
CITY OF ROUND ROCK, TEXAS
GENERAL OBLIGATION AND REFUNDING BONDS,
SERIES 2004
PURCHASE AGREEMENT
July 22, 2004
The Honorable Mayor and City Council
City of Round Rock, Texas
221 East Main Street
Round Rock, Texas 78664
Dear Mayor and Members of the City Council:
The undersigned (hereinafter sometimes called the "Representative"), acting on behalf of
itself and on behalf of the other underwriters named in the list attached as Schedule I hereto (the
Representative and such other underwriters being collectively called the "Underwriters"), offers
to enter into the following agreement with the City of Round Rock, Texas (hereinafter called the
"Issuer"), which, upon the Issuer's written acceptance of this offer, will be binding upon the
Issuer and upon the Underwriters. This offer is made subject to the Issuer's written acceptance
hereof on or before 10:00 p.m., Austin, Texas time on the date hereof, and, if not so accepted,
will be subject to withdrawal by the Underwriters upon notice delivered to the Issuer at any time
prior to the acceptance hereof by the Issuer. Terms not otherwise defined in this Purchase
Agreement shall have the same meanings set forth in the Bond Ordinance (as hereinafter
defined) or in the Official Statement (as hereinafter defined).
1. Purchase and Sale of the Bonds. Subject to the terms and conditions and in
reliance upon the representations, warranties and agreements set forth herein, the Underwriters
hereby agree to purchase from the Issuer, and the Issuer hereby agrees to sell and deliver to the
Underwriters, all, but not less than all, of the Issuer's General Obligation, Series 2004 (the
"Bonds"). The principal amounts of the Bonds to be issued, the dated date therefor, the
maturities and optional redemption provisions and interest rates per annum shall be as set forth in
the Official Statement.
The purchase price for the Bonds shall be $ (representing the par amount
of the Bonds of $ , plus a net original issue premium of $ and
less the underwriters' discount on the Bonds of $ ), plus interest accrued on the
Bonds from the dated date of the Bonds to the Closing Date (as hereinafter defined).
Delivered to the Issuer herewith is a corporate check of the Representative payable to the
order of the Issuer in the amount of $200,000. The Issuer agrees to hold such check uncashed
until the Closing (as hereinafter defined) to ensure the performance by the Underwriters of their
RAU505/64005; Austin Purchase AgreementZDOC
obligations to purchase, accept delivery of and pay for the Bonds at the Closing. Concurrently
with the payment by the Underwriters of the purchase price of the Bonds, the Issuer shall return
such check to the Representative as provided in Paragraph 6 hereof. Should the Issuer fail to
deliver the Bonds at the Closing, or should the Issuer be unable to satisfy the conditions of the
obligations of the Underwriters to purchase, accept delivery of and pay for the Bonds, as set forth
in this Purchase Agreement (unless waived by the Underwriters), or should such obligations of
the Underwriters be terminated for any reason permitted by this Purchase Agreement, such check
shall immediately be returned to the Representative. In the event the Underwriters fail (other
than for a reason permitted hereunder) to purchase, accept delivery of and pay for the Bonds at
the Closing as herein provided, such check shall be retained by the Issuer as full liquidated
damages for such failure of the Underwriters and for any defaults hereunder on the part of the
Underwriters. The Representative hereby agrees not to stop or cause payment on said check to
be stopped unless the Issuer has breached any of the terms of this Purchase Agreement.
Inasmuch as this purchase and sale represents a negotiated transaction, the Issuer
understands, and hereby confirms, that the Underwriters are not acting as a fiduciary of the
Issuer, but rather are acting solely in their individual capacities as Underwriters for their own
account.
2. The Bonds and the Official Statement; End of the Underwriting Period. (a)
The Bonds shall be as described in, and shall be issued and secured under and pursuant to the
provisions of an ordinance authorizing the issuance and sale of the Bonds (the "Bond
Ordinance"), adopted by the City Council of the Issuer on July 22, 2004.
(b) The Preliminary Official Statement of the Issuer, dated June 16, 2004, including
the cover page and Appendices thereto, relating to the Bonds (the "Preliminary Official
Statement"), as amended to conform to the terms of this Purchase Agreement and with such
changes and amendments to the date hereof as have been mutually agreed to by the Issuer and
the Underwriters, as indicated on Exhibit A attached hereto, is hereinafter called the "Official
Statement."
(c) The Issuer hereby represents and warrants that the Preliminary Official Statement
previously delivered to the Underwriters was deemed final by the Issuer as of its date, except for
the omission of such information which is dependent upon the final pricing of the Bonds for
completion, all as permitted to be excluded by Rule 15c2-12 under the Securities Exchange Act
of 1934 ("Rule 15c2-12").
(d) The Issuer has duly authorized, approved and executed the Official Statement,
which is final for purposes of Rule 15c2-12.
(e) Unless otherwise notified in writing by the Representative by the Closing Date,
the Issuer can assume that the "end of the underwriting period" for purposes of Rule 15c2-12
shall be the Closing Date. In the event such notice is so given in writing by the Representative,
the Representative agrees to notify the Issuer in writing following the occurrence of the "end of
the underwriting period" as defined in Rule 15c2-12. The "end of the underwriting period" as
used in this Purchase Agreement shall mean the Closing Date or such later date as to which
notice is given by the Representative in accordance with the preceding sentence.
RAU505/64005; Austin Purchase Agreement2.DOC
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(f) To the best knowledge and belief of the Issuer, the Official Statement contains
information, including financial information or operating data, concerning every entity,
enterprise, fund, account, or person that is material to an evaluation of the offering of the Bonds.
The Issuer has complied in all material respects with all continuing disclosure agreements made
by it in accordance with Rule 15c2-12.
3. Sale to Underwriters. It shall be a condition to the Issuer's obligation to sell and
deliver the Bonds to the Underwriters and to the Underwriters' obligation to purchase, to accept
delivery of and to pay for the Bonds, that the entire principal amount of the Bonds authorized by
the Bond Ordinance shall be issued, sold and delivered by the Issuer and purchased, accepted
and paid for by the Underwriters at the Closing. The Underwriters agree to offer the Bonds at
prices not in excess of the initial offering prices or yields set forth on the inside front cover page
of the Official Statement, plus interest accrued thereon from the date of the Bonds, and further
represent that at least ten percent (10%) of the principal amount or maturity amount of the Bonds
of each maturity shall be sold to the "public" (exclusive of dealers, brokers, investment bankers,
etc.) at the offering price set forth on the inside front cover page of the Official Statement.
4. Use of Documents; Certain Covenants and Agreements of the Issuer. (a) The
Issuer hereby authorizes the use by the Underwriters of the Bond Ordinance and the Official
Statement, including any supplements or amendments thereto, and the information therein
contained in connection with the public offering and sale of the Bonds. The Issuer ratifies and
confirms the use by the Underwriters prior to the date hereof of the Preliminary Official
Statement in connection with the public offering of the Bonds.
(b) The Issuer covenants and agrees:
(i) To cause reasonable quantities of the Official Statement, as requested by
the Underwriters, to be delivered to the Underwriters, without charge, within seven
business days of the date hereof.
(ii) To provide such information as necessary for the Underwriters to comply
with the filing requirements of Rule G-36 of the Municipal Securities Rulemaking Board.
(iii) To apply the proceeds from the sale of the Bonds as provided in and
subject to all of the terms and provisions of the Bond Ordinance authorizing their
issuance and not to take or omit to take any action which action or omission will
adversely affect the exclusion from gross income for federal income tax purposes of the
interest on the Bonds under the Internal Revenue Code of 1986 (the "Code").
(iv) If, after the date of this Purchase Agreement to and including the date the
Underwriters are no longer required pursuant to Rule 15c2-12 to provide the Official
Statement to potential customers requesting an Official Statement (such date being the
earlier of (A) 90 days from the end of the underwriting period and (B) the time when the
Official Statement is available to any person from a nationally recognized municipal
securities repository, but in no case less than 25 days after the end of the underwriting
period), any event shall occur as a result of which it is necessary to amend or supplement
the Official Statement in order to make the statements therein, in the light of the
RAU505/64005; Austin Purchase AgreementIDOC
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circumstances when the Official Statement is delivered to a purchaser, not misleading, or
if it is necessary to amend or supplement the Official Statement to comply with law, to
notify the Representative (and for the purposes of this clause (iv) to provide the
Underwriters with such information as they may from time to time request), and to
cooperate with the Representative in the preparation of either amendments or
supplements to the Official Statement so that the statements in the Official Statement as
so amended and supplemented will not, in light of the circumstances when the Official
Statement is delivered to a purchaser, be misleading or so that the Official Statement will
comply with law.
(v) To furnish such information and execute such instruments and take such
action in cooperation with the Underwriters as the Underwriters may reasonably request
(A) to (y) qualify the Bonds for offer and sale under the Blue Sky or other securities laws
and regulations of such states and other jurisdictions in the United States as the
Underwriters may designate and (z) determine the eligibility of the Bonds for investment
under the laws of such states and other jurisdictions and (B) to continue such
qualifications in effect so long as required for the distribution of the Bonds; provided,
however, that the Issuer will not be required to qualify as a foreign corporation or
otherwise to do business or to file any general or special consents to service of process
under the laws of any state or other jurisdiction.
(vi) To advise the Underwriters immediately of receipt by the Issuer of any
notification with respect to the suspension of the qualification of the Bonds for sale in
any jurisdiction or the initiation or threat of any proceeding for that purpose.
(vii) Between the date of this Purchase Agreement and the delivery of the
Bonds, the Issuer will not, without the prior consent of the Underwriters, issue any bonds,
notes or other obligations for borrowed money or incur any material liabilities, direct or
contingent, payable from or secured by a pledge of the taxes, revenues or other assets of
the Issuer.
5. Representations and Warranties of the Issuer. The Issuer hereby represents
and warrants to the Underwriters as of the date hereof and as of the Closing Date, which
representations and warranties shall survive the purchase and offering of the Bonds as follows:
(a) The Issuer is a duly organized municipal corporation and a political subdivision
duly created and validly existing under the Constitution and the laws of the State of Texas and
has full legal right, power and authority pursuant to the Constitution and laws of the State of
Texas, including particularly Chapters 1207 and 1331, Texas Government Code, as amended
(the "Acts"), and at the date of the Closing will have, full legal right, power and authority to (i)
enter into this Purchase Agreement, (ii) enter into the escrow agreement (the "Escrow
Agreement") pertaining to the Refunded Bonds, between the Issuer and the escrow agent named
in the Official Statement, (iii) adopt the Bond Ordinance, (iv) sell, issue and deliver the Bonds to
the Underwriters as provided herein, (v) secure the payment of the Bonds as provided in the
Bond Ordinance, and (vi) carry out and consummate the transactions contemplated by this
Purchase Agreement, the Bond Ordinance, the Escrow Agreement and the Official Statement,
RAU505/64005; Austin Purchase Agreementll)OC
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and the Issuer has complied, and will at the Closing be in compliance in all respects, with the
terms of the Acts and the Bond Ordinance as they pertain to such transactions.
(b) By all necessary official action of the Issuer prior to or concurrently with the
acceptance hereof, the Issuer has duly adopted the Bond Ordinance, has duly authorized and
approved the execution and delivery of, and the performance by the Issuer of the obligations on
its part contained in the Bonds, the Bond Ordinance, this Purchase Agreement, the Escrow
Agreement and the consummation by it of all other transactions contemplated by the Official
Statement, the Bond Ordinance, the Escrow Agreement and this Purchase Agreement; the Bond
Ordinance, the Escrow Agreement and this Purchase Agreement each constitute legal, valid and
binding obligations of the Issuer, enforceable in accordance with their respective terms, subject
to bankruptcy, insolvency, reorganization, moratorium and other similar laws and principles of
equity relating to or affecting the enforcement of creditors' rights; the Bonds, when issued,
authenticated and delivered to the Underwriters in accordance with the Bond Ordinance, the
Escrow Agreement and this Purchase Agreement, will be payable from the levy and collection of
a direct and continuing ad valorem tax levied, within the limits prescribed by law, on all taxable
property located within the Issuer, will be entitled to the benefits of the Bond Ordinance and will
be enforceable in accordance with their terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other similar laws and principles of equity relating to or affecting the
enforcement of creditors' rights.
(c) The Issuer is not in breach of or default under any applicable constitutional
provision, law or administrative regulation of the State of Texas or the United States of America
or any applicable judgment or decree or any loan agreement, indenture, bond, note, ordinance,
resolution, agreement or other instrument to which the Issuer is a party or to which the Issuer or
any of its property or assets are otherwise subject, and no event has occurred and is continuing
which constitutes or with the passage of time or the giving of notice, or both, would constitute a
default or event of default by the Issuer under any such instrument except as may be disclosed in
the Official Statement; and the execution and delivery of the Bonds and this Purchase
Agreement, adoption of the Bond Ordinance and compliance on the Issuer's part with the
provisions contained therein, will not conflict with or constitute a breach of or default under any
constitutional provision, administrative regulation, judgment, decree, loan agreement, indenture,
bond, note, ordinance, resolution, agreement or other instrument to which the Issuer is a party or
to which the Issuer or any of its property or assets are otherwise subject, nor will any such
execution, delivery, adoption or compliance result in the creation or imposition of any lien,
charge or other security interest or encumbrance of any nature whatsoever upon any of the
property or assets of the Issuer under the terms of any such law, regulation or instrument, except
as provided by the Bonds and the Bond Ordinance.
(d) All authorizations, approvals, licenses, permits, consents and orders of any
governmental authority, legislative body, board, agency or commission having jurisdiction over
the matter which are required for the due authorization of, which would constitute a condition
precedent to, or the absence of which would have a material adverse effect on the due
performance by the Issuer of its obligations under, this Purchase Agreement, the Escrow
Agreement, the Bond Ordinance and the Bonds have been duly obtained, except for the approval
of the Bonds by the Attorney General of the State of Texas (and the registration of the Bonds by
the Comptroller of Public Accounts of the State of Texas) and such approvals, consents and
RAU505/64005; Austin Purchase Agreementl[)OC
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orders as are stated in the Official Statement as yet to be obtained or as may be required under
the Blue Sky or securities laws of any state in connection with the offering and sale of the Bonds.
(e) The Bonds conform to the description thereof contained in the Official Statement
under the caption "THE BONDS" (except under the subcaption "Book -Entry -Only System") and
the proceeds of the Bonds will be applied generally as described in the Official Statement.
(f) There is no action, suit, proceeding, inquiry or investigation, at law or in equity,
before or by any court, government agency, public board or body, pending or, to the best
knowledge of the Issuer after due inquiry, threatened against the Issuer, affecting the corporate
existence of the Issuer or the titles of its officers to their respective offices, or affecting or
seeking to prohibit, restrain or enjoin the sale, issuance or delivery of the Bonds or the levy,
collection or application of the ad valorem taxes pledged or to be pledged to pay the principal of
and interest on the Bonds, or the pledge thereof, or in any way contesting or affecting the validity
or enforceability of the Bonds, the Bond Ordinance, the Escrow Agreement or this Purchase
Agreement, or contesting in any way the completeness or accuracy of the Preliminary Official
Statement or the Official Statement or any supplement or amendment thereto, or contesting the
powers of the Issuer or any authority for the issuance of the Bonds, the adoption of the Bond
Ordinance or the execution and delivery of this Purchase Agreement and the Escrow Agreement,
nor, to the best knowledge of the Issuer, is there any basis therefor, wherein an unfavorable
decision, ruling or finding would have a material adverse effect on the validity or enforceability
of the Bonds, the Bond Ordinance, the Escrow Agreement or this Purchase Agreement.
(g) As of the date thereof, the Preliminary Official Statement did not contain any
untrue statement of a material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances under which they were
made, not misleading.
(h) At the time of the Issuer's acceptance hereof and (unless an event occurs of the
nature described in Paragraph 4(b)(iv)) at all times subsequent thereto during the period up to
and including the date the Underwriters are no longer required pursuant to Rule 15c2-12 to
provide the Official Statement to potential customers requesting an Official Statement (as more
particularly described in Paragraph 4(b)(iv)), the Official Statement does not and will not contain
any untrue statement of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
(i) If the Official Statement is supplemented or amended pursuant to Paragraph
4(b)(iv), at the time of each supplement or amendment thereto and (unless subsequently again
supplemented or amended pursuant to such paragraph) at all times subsequent thereto during the
period up to and including the date the Underwriters are no longer required pursuant to Rule
15c2-12 to provide the Official Statement to potential customers requesting an Official Statement
(as more particularly described in Paragraph 4(b)(iv)), the Official Statement as so supplemented
or amended will not contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
RAU505/64005; Austin Purchase Agreement2.DOC
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0) The financial statements of, and other financial information regarding, the Issuer
in the Official Statement fairly present the financial position and results of the operations of the
Issuer as of the dates and for the periods therein set forth and (i) the unaudited financial
statements have been prepared on a basis substantially consistent with the audited financial
statements included in the Official Statement and reflect all adjustments necessary to that effect,
and (ii) the other financial information has been determined on a basis substantially consistent
with that of the Issuer's audited financial statements included in the Official Statement.
(k) Any certificate signed by any official of the Issuer authorized to do so in
connection with the transactions contemplated by this Purchase Agreement shall be deemed a
representation and warranty by the Issuer to the Underwriters as to the statements made therein.
6. Closin . (a) At 10:00 a.m., Austin, Texas time, on August 12, 2004, or at such
other time and date as shall have been mutually agreed upon by the Issuer and the Representative
(the "Closing Date"), the Issuer will, subject to the terms and conditions hereof, deliver to the
Representative the initial Bonds registered in the name of the Representative, in temporary form,
together with the other documents hereinafter mentioned, and will have available for immediate
exchange definitive Bonds deposited with The Depository Trust Company, New York, New
York ("DTC"), or deposited with the Paying Agent/Registrar, if the Bonds are to be held in
safekeeping for DTC by the Paying Agent/Registrar pursuant to DTC's FAST system and the
Bond Ordinance, duly executed and authenticated in the form and manner contemplated below,
together with the other documents hereinafter mentioned, and the Underwriters will, subject to
the terms and conditions hereof, accept such delivery and pay the purchase price of the Bonds as
set forth in Paragraph 1 hereof in immediately available funds (such events being referred to
herein as the "Closing"). Concurrently with such payment by the Underwriters, the Issuer shall
return to the Representative, the check referred to in Paragraph 1 hereof. Payment for the Bonds
as aforesaid shall be made at the offices of the paying agent/registrar, or such other place as shall
have been mutually agreed upon by the Issuer and the Underwriters.
(b) Delivery of the definitive Bonds in exchange for the initial Bonds shall be made
through DTC, utilizing the book -entry only form of issuance, and the Issuer agrees to enter into
such agreement, including a "Letter of Representations," as may be required to allow for the use
of such book -entry only system. The definitive Bonds shall be delivered in fully registered form
bearing CUSIP numbers without coupons with one Certificate for each maturity of Bonds,
registered in the name of CEDE & CO. and shall be made available at the Designated
Payment/Transfer Office of the Paying Agent/Registrar to the Representative at least one
business day before the Closing for purposes of inspection.
7. Closing Conditions. The Representative has entered into this Purchase
Agreement in reliance upon the representations, warranties and agreements of the Issuer
contained herein, and in reliance upon the representations, warranties and agreements to be
contained in the documents and instruments to be delivered at the Closing and upon the
performance by the Issuer of its obligations hereunder, both as of the date hereof and as of the
date of the Closing. Accordingly, the Underwriters' obligations under this Purchase Agreement
to purchase, to accept delivery of and to pay for the Bonds shall be conditioned upon the
performance by the Issuer of its obligations to be performed hereunder and under such
RAU505/64005; Austin Purchase AgreementIDOC
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documents and instruments at or prior to the Closing, and shall also be subject to the following
additional conditions:
(a) The representations and warranties of the Issuer contained herein or in any
certificate or other document delivered pursuant to the provisions hereof shall be true, complete
and correct on the date hereof and on and as of the date of the Closing, as if made on the date of
the Closing.
(b) At the time of the Closing, the Bond Ordinance shall be in full force and effect
and shall not have been amended, modified or supplemented, and the Official Statement shall not
have been supplemented or amended, except in any such case as may have been agreed to by the
Representative.
(c) At the time of the Closing, all official action of the Issuer relating to this Purchase
Agreement, the Bonds and the Bond Ordinance shall be in full force and effect and shall not have
been amended, modified or supplemented; and the Representative shall have received, in
appropriate form, evidence thereof.
(d) At the time of the Closing, there shall not have occurred any change in the
condition, financial or otherwise, or in the earnings or operations of the Issuer, from that set forth
in the Official Statement that, in the judgment of the Representative, is material and adverse and
that makes it, in the judgment of the Representative, impracticable to market the Bonds on the
terms and in the manner contemplated in the Official Statement.
(e) The Issuer shall not have failed to pay principal or interest when due on any of its
outstanding obligations for borrowed money.
(f) All steps to be taken and all instruments and other documents to be executed, and
all other legal matters in connection with the transactions contemplated by this Purchase
Agreement shall be reasonably satisfactory in legal form and effect to counsel for the
Underwriters.
(g) At or prior to the Closing, the Representative shall have received copies of each
of the following documents:
(1) The Official Statement, and each supplement or amendment, if
any, thereto, executed on behalf of the Issuer by the Mayor and the City Secretary
of the Issuer.
(2) The Bond Ordinance certified by the City Secretary under its seal
as having been duly adopted by the Issuer and as being in effect, with such
changes or amendments as may have been agreed to by the Representative, and
containing therein the agreement of the Issuer to provide certain periodic
information and notices of material events in accordance with Rule 15c2-12, as
described in the Official Statement under the caption "CONTINUING
DISCLOSURE OF INFORMATION."
RAU505/64005; Austin Purchase Agreement2S)OC
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(3) The Escrow Agreement, having been duly executed on behalf of
the Issuer by the Mayor and City Secretary and JPMorgan Chase Bank (the
"Escrow Agent").
(4) The opinion of McCall, Parkhurst & Horton L.L.P., Bond Counsel,
in substantially the form and substance of Appendix C to the Official Statement.
(5) An opinion or certificate, dated on or prior to the date of Closing,
of the Attorney General of the State of Texas, approving the Bonds, as required
by law, and the registration certificates of the Comptroller of Public Accounts of
the State of Texas for the Bonds.
(6) The supplemental opinion, dated the date of the Closing, of
McCall, Parkhurst & Horton L.L.P., addressed to the Issuer and the Underwriters
to the effect that: (i) the Bonds are exempt securities within the meaning of
Section 3(a)(2) of the Securities Act of 1933, as amended, and it is not necessary
in connection with the sale of the Bonds to the public to register the Bonds under
the Securities Act of 1933, as amended, or to qualify the Bond Ordinance under
the Trust Indenture Act of 1939, as amended, and (ii) except to the extent noted
therein, said firm has not verified and is not passing upon, and does not assume
any responsibility for, the accuracy, completeness or fairness of the statements
contained in the Official Statement but that said firm has reviewed the
information contained in the Official Statement under the captions "PLAN OF
FINANCING" (other than information under the subcaption "Sources and Uses of
Proceeds"), "THE BONDS" (other than information under the subcaptions
"Book -Entry -Only System" and "Bondholders' Remedies"), "TAX MATTERS,"
"CONTINUING DISCLOSURE OF INFORMATION" (other than information
under the subcaption "Compliance with Prior Undertakings"), and under the
subcaptions "- Registration and Qualification of Bonds for Sale," "- Legal
Investments and Eligibility to Secure Public Funds in Texas," and "- Legal
Matters" under the caption "OTHER INFORMATION" and in APPENDIX C,
and such firm is of the opinion that the information relating to the Bonds and the
Bond Ordinance contained therein accurately and fairly reflects the provisions
thereof and is correct as to matters of law.
(7) An opinion, dated the date of the Closing and addressed to the
Underwriters, of Vinson & Elkins L.L.P., Austin, Texas ("Underwriters'
Counsel"), in substantially the form of Exhibit B hereto.
(8) A certificate, dated the date of the Closing, signed by the Mayor
and the City Manager, to the effect that (i) the representations and warranties of
the Issuer contained herein or in any certificate or document delivered by the
Issuer pursuant to the provisions hereof are true and correct in all material
respects on and as of the date of Closing as if made on the date of Closing, and all
agreements or conditions to be performed or complied with by the Issuer
hereunder on or prior to the date of the Closing have been performed or complied
with; (ii) except to the extent disclosed in the Official Statement, no litigation is
RAU505/64005; Austin Purchase Agreementll)OC
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pending or, to the knowledge of such persons, threatened in any court to restrain
or enjoin the issuance or delivery of the Bonds or the levy, collection or
application of the ad valorem taxes pledged or to be pledged to pay the principal
of and interest on the Bonds, or the pledge thereof, or in any way contesting or
affecting the validity of the Bonds, the Bond Ordinance, the Escrow Agreement or
this Purchase Agreement, or contesting the powers of the Issuer or contesting the
authorization of the Bonds or the Bond Ordinance, or contesting in any way the
accuracy, completeness or fairness of the Official Statement (but in lieu of or in
conjunction with such certificate, the Representative may, in its sole discretion,
accept certificates or opinions of the General Counsel of the Issuer that, in his or
her opinion, the issues raised in any such pending or threatened litigation are
without substance or that the contentions of all plaintiffs therein are without
merit); (iii) no event affecting the Issuer has occurred since the date of the Official
Statement which should be disclosed in the Official Statement for the purpose for
which it is to be used or which it is necessary to disclose therein in order to make
the statements and information therein not misleading in any material respect; (iv)
the descriptions and statements of or pertaining to the Issuer contained in the
Official Statement, on the date of sale of the Bonds and on the date of the delivery
of the Bonds, were and are true and correct in all material respects; (v) insofar as
the Issuer and its affairs, including its financial affairs, are concerned, such
Official Statement did not and does not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; (vi) insofar as the descriptions and statements
including financial data, of or pertaining to entities, other than the Issuer, and their
activities contained in the Official Statement are concerned, such statements and
data have been obtained from sources which the Issuer believes to be reliable and
the Issuer has no reason to believe that they are untrue in any material respect;
and (vii) there has not been any material and adverse change in the affairs or
financial condition of the Issuer since September 30, 2003, the latest date as to
which audited financial information is available.
(9) A certificate, dated the date of Closing, of an appropriate official
of the Issuer to the effect that, on the basis of the facts, estimates and
circumstances in effect on the date of delivery of the Bonds, it is not expected that
the proceeds of the Bonds will be used in a manner that would cause the Bonds to
be arbitrage bonds within the meaning of Section 148 of the Code.
(10) Evidence satisfactory to the Representative that the Bonds have
been rated "Aaa" by Moody's Investors Service, Inc. and "AAA" by Standard &
Poor's Ratings Services, A Division of the McGraw-Hill Companies, Inc. and that
all such ratings are in effect as of the date of Closing.
(11) Evidence acceptable to the Underwriters of the purchase by the
Issuer or the Escrow Agent of the federal securities, as described in the Escrow
Agreement, and the deposit thereof to the escrow fund described therein.
RAU505/64005; Austin Purchase Agreement2DOC
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(12) The verification of mathematical computations by Grant Thornton
LLP (the "Verification Agent") referred to in the Official Statement, addressed to
the Issuer, Bond Counsel and the Underwriters.
(13) A copy of the policy of municipal bond insurance issued by
, together with the customary opinion of its
legal counsel as to the validity and enforceability of such policy and the fairness
and accuracy of the language contained in the Official Statement.
(14) Such additional legal opinions, certificates, instruments and other
documents as the Representative or Underwriters' Counsel may request to
evidence the truth and accuracy, as of the date hereof and as of the date of the
Closing, of the Issuer's representations and warranties contained herein and of the
statements and information contained in the Official Statement and the due
performance or satisfaction by the Issuer on or prior to the date of the Closing of
all the respective agreements then to be performed and conditions then to be
satisfied by the Issuer.
All of the opinions, letters, certificates, instruments and other documents mentioned
above or elsewhere in this Purchase Agreement shall be deemed to be in compliance with the
provisions hereof if, but only if, they are in form and substance satisfactory to the Underwriters.
If the Issuer shall be unable to satisfy the conditions to the obligations of the
Underwriters to purchase, to accept delivery of and to pay for the Bonds contained in this
Purchase Agreement, or if the obligations of the Underwriters to purchase, to accept delivery of
and to pay for the Bonds shall be terminated for any reason permitted by this Purchase
Agreement, this Purchase Agreement shall terminate and neither the Underwriters nor the Issuer
shall be under any further obligation hereunder, except that (i) the check referred to in Paragraph
1 hereof shall be immediately returned to the Representative by the Issuer and (ii) the respective
obligations of the Issuer and the Underwriters set forth in Paragraph 9 hereof shall continue in
full force and effect.
8. Termination. The Underwriters shall have the right to terminate in its absolute
discretion the Underwriters' obligation under this Purchase Agreement to purchase, to accept
delivery of and to pay for the Bonds by notifying the Issuer of its election to do so if, after the
execution hereof and prior to the Closing:
(a) (i) Legislation (including any amendment thereto) shall have been introduced in
or adopted by either House of the Congress of the United States or recommended to the Congress
or otherwise endorsed for passage by the President of the United States, the Treasury Department
of the United States, the Internal Revenue Service or the Chairman or ranking minority member
of the Committee on Finance of the United States Senate or the Committee on Ways and Means
of the United States House of Representatives, or legislation is proposed for consideration by
either such committee by any member thereof or presented as an option for consideration by
either such committee by the staff of such committee, or by the staff of the Joint Committee on
Taxation of the Congress of the United States, or a bill to amend the Internal Revenue Code
(which, if enacted, would be effective as of a date prior to the Closing) shall be filed in either
RAU505/64005; Austin Purchase Agreementll)OC
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house, or (ii) a decision shall have been rendered by a court established under Article III of the
Constitution of the United States or by the United States Tax Court, or (iii) an order, filing,
ruling or regulation shall have been issued or proposed by or on behalf of the Treasury
Department of the United States or the Internal Revenue Service or any other agency of the
United States, or (iv) a release or official statement shall have been issued by the President of the
United States or by the Treasury Department of the United States or by the Internal Revenue
Service, the effect of which, in any such case described in clause (i), (ii), (iii), or (iv), would be
to impose, directly or indirectly, federal income taxation upon interest received on obligations of
the general character of the Bonds or upon income of the general character to be derived by the
Issuer, other than as imposed on the Bonds and income therefrom under the federal tax laws in
effect on the date hereof, in such a manner as in the judgment of the Underwriters would make it
impracticable to market the Bonds on the terms and in the manner contemplated in the Official
Statement.
(b) Any action shall have been taken by the Securities and Exchange Commission or
by a court which would require registration of any security under the Securities Act of 1933, as
amended, or qualification of any indenture under the Trust Indenture Act of 1939, as amended, in
connection with the public offering of the Bonds; any action shall have been taken by any court
or by any governmental authority suspending the use of the Official Statement or any
amendment or supplement thereto, or any proceeding for that purpose shall have been initiated or
threatened in any such court or by any such authority; any state blue sky or securities
commission or other governmental agency or body shall have withheld registration, exemption
or clearance of the offering of the Bonds, as described herein, or issued a stop order or similar
ruling relating thereto.
(c) (i) The Constitution of the State of Texas shall be amended or an amendment shall
be proposed, or (ii) legislation shall be enacted, or (iii) a decision shall have been rendered as to
matters of Texas law, or (iv) any order, ruling or regulation shall have been issued or proposed
by or on behalf of the State of Texas by an official, agency or department thereof, affecting the
tax status of the Issuer, its property or income, its notes or bonds (including the Bonds) or the
interest thereon, which in the judgment of the Underwriters would make it impracticable to
market the Bonds on the terms and in the manner contemplated in the Official Statement.
(d) Any fact or event shall exist or have existed that, in the Representative's judgment
would make it impracticable to market the bonds on the terms and in the manner contemplated in
the Official Statement, and requires or has required an amendment of or supplement to the
Official Statement in order to make the statements therein, in light of the circumstances under
which they were made, not misleading or to comply with law.
(e) (i) (A) Trading generally shall have been suspended or materially limited on or
by, as the case may be, either of the New York Stock Exchange or the American Stock
Exchange, (B) a general moratorium on commercial banking activities in New York shall have
been declared by either Federal or New York State authorities, or (C) there shall have occurred
any outbreak or escalation of hostilities or any change in financial markets or any calamity or
crisis that, in the reasonable judgment of the Underwriters, is material and adverse and (ii) in the
case of any of the events specified in clauses (A) through (C), such event singly or together with
RAU505/64005; Austin Purchase AgreementIDOC
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any other such event makes it, in the judgment of the Representative, impracticable to market the
Bonds on the terms and in the manner contemplated in the Official Statement.
(f) There shall have occurred any downgrading, or any notice shall have been given
of (i) any intended or potential downgrading or (ii) any review or possible change that does not
indicate the direction of a possible change, in the rating accorded any of the Issuer's obligations
(including the ratings to be accorded the Bonds) by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2) under the Securities Act of
1933, as amended.
(g) Legislation shall have been enacted by the federal government or the State of
Texas, a decision of any federal or State of Texas court shall have been made, or a ruling or
regulation (proposed, temporary or final) of the Securities and Exchange Commission or other
governmental agency shall have been made or issued that, in the opinion of Underwriters'
Counsel, has the effect of requiring the contemplated distribution of the Bonds or any agreement
offered in connection therewith to be registered under the Securities Act of 1933, as amended, or
the Bond Ordinance to be qualified as an indenture under the Trust Indenture Act of 1939, as
amended.
(h) A change in applicable law shall occur or any governmental authority, board,
agency or commission of the federal government or in the State of Texas shall take any action
the result of which in each case is to prohibit the purchase of and payment for the Bonds by the
Underwriters, or the resale of the Bonds by the Underwriters, on the terms and conditions herein.
(i) The debt ceiling of the United States is such that the federal securities required to
fund the Escrow Agreement are not available for delivery on the date of the delivery of the
Bonds.
9. Expenses. (a) The Underwriters shall be under no obligation to pay, and the
Issuer shall pay, any expenses incident to the performance of the Issuer's obligations hereunder,
including, but not limited to (i) the cost of preparation, printing and delivery of the Preliminary
Official Statement and the Official Statement; (ii) the cost of preparation and printing of the
Bonds; (iii) the fees and disbursements of McCall, Parkhurst & Horton L.L.P. for their services
as Bond Counsel to the Issuer; (iv) the fees and disbursements of the financial advisor to the
Issuer; (v) the fees and disbursements of any other engineers, accountants, and other experts,
consultants or advisers retained by the Issuer; and (vi) the fees, if any, for bond ratings.
(b) The Underwriters shall pay (i) the cost of preparation and printing of this
Purchase Agreement; (ii) all advertising expenses in connection with the public offering of the
Bonds; and (iii) all other expenses incurred by them or any of them in connection with the public
offering of the Bonds, including the fees and disbursements of Underwriters' Counsel.
10. Notices. Any notice or other communication to be given to the Issuer under this
Purchase Agreement may be given by delivering the same in writing at City of Round Rock,
Texas, 221 East Main Street, Round Rock, Texas 78664, Attention: City Manager, and any
notice or other communication to be given to the Underwriters under this Purchase Agreement
RAU505/64005; Austin Purchase Agreement2.DOC
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may be given by delivering the same in writing to RBC Dain Rauscher Inc., 1001 Fannin, Suite
400, Houston, Texas 77002, Attention: Mark Nitcholas.
11. Parties in Interest. This Purchase Agreement as heretofore specified shall
constitute the entire agreement between us and is made solely for the benefit of the Issuer and the
Underwriters (including successors or assigns of the Underwriters) and no other person shall
acquire or have any right hereunder or by virtue hereof. This Purchase Agreement may not be
assigned by the Issuer. All of the Issuer's representations, warranties and agreements contained
in this Purchase Agreement shall remain operative and in full force and effect, regardless of (i)
any investigations made by or on behalf of the Underwriters; (ii) delivery of and payment for the
Bonds pursuant to this Purchase Agreement; and (iii) any termination of this Purchase
Agreement.
12. Effectiveness. This Purchase Agreement shall become effective upon the
acceptance hereof by the Issuer and shall be valid and enforceable at the time of such acceptance.
13. Representative Capacity. Any authority, right, discretion or other power
conferred upon the Underwriters or the Representative under any provision of this Purchase
Agreement may be exercised by the Representative, and the Issuer shall be entitled to rely upon
any request, notice or statement if the same shall have been given or made by the Representative.
14. CHOICE OF LAW. THIS PURCHASE AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE
OF TEXAS.
15. Severability. If any provision of this Purchase Agreement shall be held or
deemed to be or shall, in fact, be invalid, inoperative or unenforceable as applied in any
particular case in any jurisdiction or jurisdictions, or in all jurisdictions because it conflicts with
any provisions of any Constitution, statute, rule of public policy, or any other reason, such
circumstances shall not have the effect of rendering the provision in question invalid, inoperative
or unenforceable in any other case or circumstance, or of rendering any other provision or
provisions of this Purchase Agreement invalid, inoperative or unenforceable to any extent
whatever.
16. Business Day. For purposes of this Purchase Agreement, "business day" means
any day on which the New York Stock Exchange is open for trading.
17. Parazraph Headings. Paragraph headings have been inserted in this Purchase
Agreement as a matter of convenience of reference only, and it is agreed that such paragraph
headings are not a part of this Purchase Agreement and will not be used in the interpretation of
any provisions of this Purchase Agreement.
18. Counterparts. This Purchase Agreement may be executed in several
counterparts each of which shall be regarded as an original (with the same effect as if the
signatures thereto and hereto were upon the same document) and all of which shall constitute one
and the same document.
RAU505/64005; Austin Purchase Agreement2.DOC
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Accepted and agreed to this
day of July _, 2004
CITY OF ROUND ROCK, TEXAS
By:
Title: Mayor
ATTEST:
By:
Title: City Secretary
Very truly yours,
RBC DAIN RAUSCHER INC.
as Representative for the Underwriters
identified on Schedule I
LIZ
Authorized Officer
[Signature Page for Purchase Agreement]
RAU505/64005; Austin Purchase Agreementll)OC
SCHEDULEI
LIST OF UNDERWRITERS
RBC DAIN RAUSCHER INC.
A.G. EDWARDS & SONS, INC.
ESTRADA HINOJOSA & COMPANY, INC.
MORGAN KEEGAN & COMPANY, INC.
RAU505/64005; Austin Purchase Agreement2.DOC
Exhibit A
[Attach form of Official Statement completed as provided in
Section 1 hereof)
RAU505/64005; Austin Purchase Agreement2.DOC
A-1
Exhibit B
, 2004
RBC Dain Rauscher Inc.
Morgan Keegan & Company, Inc.
Estrada Hinojosa & Company, Inc.
A.G. Edwards, Inc.
c/o RBC Dain Rauscher Inc.
1001 Fannin, Suite 400
Houston, Texas 77002
Re: City of Round Rock, Texas, General Obligation and Refunding Bonds,
Series 2004
Ladies and Gentlemen:
We have acted as counsel to you as Underwriters of $ aggregate principal
amount of the captioned General Obligation and Refunding Bonds, Series 2004 (the "Bonds")
issued by the City of Round Rock, Texas (the "Issuer"), pursuant to an ordinance adopted by the
City Council of the Issuer on (the "Bond Ordinance"). The Underwriters are
purchasing the Bonds pursuant to the Purchase Agreement (the "Purchase Agreement") with
respect thereto, dated , 2004. Unless otherwise expressly provided herein,
capitalized terms used in this opinion shall have the meanings ascribed to them in the Purchase
Agreement.
As your counsel, we have examined executed copies of the Bond Ordinance, the
Purchase Agreement and the Official Statement and the certificates and opinions referred to in
Paragraph 7(g) of the Purchase Agreement. In addition, we have examined the originals or
copies, certified or otherwise identified to our satisfaction, of such records of the Issuer,
agreements and other instruments, certificates of public officials and representatives of the
Issuer, and such other documents as we have deemed necessary or advisable as a basis for the
opinions hereinafter expressed.
Based on the foregoing and in reliance on the matters described below, we are of the
opinion that the offer and sale of the Bonds by you do not require the registration of any security
under the Securities Act of 1933, as amended and now in effect, and no instrument need be
qualified under the Trust Indenture Act of 1939, as amended and now in effect, in connection
therewith.
RAU505/64005; Austin Purchase AgreementZDOC
B-1
Because the primary purpose of our professional engagement was not to establish factual
matters and because of the wholly or partially non -legal character of many determinations
involved in the preparation of the Official Statement, we are not passing upon and do not assume
any responsibility for the accuracy, completeness, or fairness of the statements contained in the
Official Statement, and make no representation that we have independently verified the accuracy,
completeness or fairness of any such statements. At your request, we have participated as your
counsel in conferences with representatives of the Issuer, the bond counsel to the Issuer, the
financial advisors to the Issuer and your representatives, at which conferences the contents of the
Official Statement and related matters were discussed. Based on our participation in the above-
mentioned conferences and in reliance thereon and on the certificates, opinions and other
documents herein mentioned, we advise you that no facts have come to our attention that lead us
to believe that the Official Statement (except as to any statistical or financial data included in the
Official Statement, as to which we are not called upon to express any opinion or belief) contains
any untrue statement of a material fact or omits to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made, not misleading.
The opinions expressed herein are expressed only insofar as the laws of the State of
Texas and the United States of America may be applicable. This opinion may be relied upon
only by the addressees hereof and may not be used or relied upon by any other person for any
purpose whatsoever without, in each instance, our prior written consent.
Very truly yours,
RAU505/64005; Austin Purchase Agreement2.DOC
B-2
ESCROW AGREEMENT
Round Rock, Texas
General Obligation and Refunding Bonds, Series 2004
THIS ESCROW AGREEMENT, dated as of July 15, 2004 (herein, together with any
amendments or supplements hereto, called the "Agreement") is entered into by and between Round
Rock, Texas (herein called the "Issuer") and JPMorgan Chase Bank as escrow agent (herein, together
with any successor in such capacity, called the "Escrow Agent"). The addresses of the Issuer and the
Escrow Agent are shown on Exhibit "A" attached hereto and made a part hereof.
WITNESSETH:
WHEREAS, the Issuer heretofore issued and there presently remain outstanding the
obligations (the "Refunded Obligations") described in the Verification Report ofGrant Thornton LLP
(the "Report") relating to the Refunded Obligations, attached hereto as Exhibit "B" and made a part
hereof; and
WHEREAS, the Refunded Obligations are scheduled to mature in such years, bear interest
at such rates, and be payable at such times and in such amounts as are set forth in the Report; and
WHEREAS, when firm banking arrangements have been made for the payment of principal
and interest to the maturity or redemption dates of the Refunded Obligations, then the Refunded
Obligations shall no longer be regarded as outstanding except for the purpose of receiving payment
from the funds provided for such purpose; and
WHEREAS, Chapter 1207, Texas Government Code, as amended (Chapter 1207),
authorizes the Issuer to issue refunding bonds and to deposit the proceeds from the sale thereof, and
any other available funds or resources, directly with any place of payment (paying agent) for any of
the Refunded Obligations, and such deposit, if made before such payment dates and in sufficient
amounts, shall constitute the making offirmbanking and financial arrangements for the discharge and
final payment of the Refunded Obligations; and
WHEREAS, Chapter 1207 further authorizes the Issuer to enter into an escrow agreement
with any such paying agent for any of the Refunded Obligations with respect to the safekeeping,
investment, administration and disposition of any such deposit, upon such terms and conditions as
the Issuer and such paying agent may agree, provided that such deposits may be invested only in
obligations authorized in Chapter 1207 and which shall mature and/or bear interest payable at such
times and in such amounts as will be sufficient to provide for the scheduled payment ofprincipal and
interest on the Refunded Obligations when due; and
RR0CK/G0AndRefgRonds2004: Es=Ag=ment
WHEREAS, the Escrow Agent is a paying agent for the Refunded Obligations and this
Agreement constitutes an escrow agreement of the kind authorized and required by said Chapter
1207; and
WHEREAS, Chapter 1207 makes it the duty of the Escrow Agent to comply with the terms
of this Agreement and timely make available to the other places of payment (paying agents) for the
Refunded Obligations the amounts required to provide for the payment ofthe principal ofand interest
on such obligations when due, and in accordance with their terms, but solely from the funds, in the
manner, and to the extent provided in this Agreement; and
WHEREAS, the issuance, sale, and delivery of the Issuer's General Obligation and
Refunding Bonds, Series 2004 (the "Refunding Obligations") have been issued, sold and delivered
for the purpose, among others, of obtaining the funds required to provide for the payment of the
principal of the Refunded Obligations at their respective maturity dates or dates of redemption and
the interest thereon to such dates; and
WHEREAS, the Issuer desires that, concurrently with the delivery of the Refunding
Obligations to the purchasers thereof, certain proceeds of the Refunding Obligations, together with
certain other available funds of the Issuer, if applicable, shall be applied to purchase certain direct
obligations of the United States of America hereinafter defined as the "Escrowed Securities" for
deposit to the credit of the Escrow Fund created pursuant to the terms of this Agreement and to
establish a beginning cash balance (if needed) in such Escrow Fund; and
WHEREAS, the Escrowed Securities shall mature and the interest thereon shall be payable
at such times and in such amounts so as to provide moneys which, together with cash balances from
time to time on deposit in the Escrow Fund, will be sufficient to pay interest on the Refunded
Obligations as it accrues and becomes payable and the principal of the Refunded Obligations on their
maturity dates or dates of redemption; and
WHEREAS, to facilitate the receipt and transfer of proceeds of the Escrowed Securities,
particularly those in book entry form, the Issuer desires to establish the Escrow Fund at the principal
corporate trust office of the Escrow Agent; and
WHEREAS, the Escrow Agent is herein also referred to as the "Paying Agent," and any
paying agent for the Refunded Obligations, acting through the Escrow Agent, is also a party to this
Agreement, as a paying agent for the Refunded Obligations to acknowledge their acceptance of the
terms and provisions of this Agreement in such capacity.
NOW, THEREFORE, inconsideration ofthe mutual undertakings, promises and agreements
herein contained, the sufficiency of which hereby are acknowledged, and to secure the full and timely
payment of principal of and the interest on the Refunded Obligations, the Issuer and the Escrow
Agent mutually undertake, promise, and agree for themselves and their respective representatives and
successors, as follows:
RROCK/GOAndRe4g3onds2O04: Es—Agreement
ARTICLE I
DEFINITIONS AND INTERPRETATIONS
Section 1.01. Definitions. Unless the context clearly indicates otherwise, the following
terms shall have the meanings assigned to them below when they are used in this Agreement:
"Code" means the Internal Revenue Code of 1986, as amended, or to the extent applicable
the Internal Revenue Code of 1954, together with any other applicable provisions of any successor
federal income tax laws.
"Escrow Fund" means the fund created by this Agreement to be administered by the Escrow
Agent pursuant to the provisions of this Agreement.
"Escrowed Securities" means the direct noncallable, not pre -payable United States Treasury
obligations and obligations the due timely payment of which is unconditionally guaranteed by the
United States of America described in the Report or cash or other direct obligations of the United
States of America substituted therefor pursuant to Article IV of this Agreement.
"Paying Agent" means The Bank of New York Trust Company, N.A. as paying agent for the
Series 1995 Combination Tax and Revenue Certificates of Obligation and JPMorgan Chase Bank as
paying agent for the Series 1996 General Obligation and Refunding Bonds.
Section 1.02. Other Definitions. The terms "Agreement", "Issuer", "Escrow Agent",
"Refunded Obligations", "Refunding Obligations," "Report" and "Paying Agent", when they are used
in this Agreement, shall have the meanings assigned to them in the preamble to this Agreement.
Section 1.03. Interpretations. The titles and headings of the articles and sections of this
Agreement have been inserted for convenience and reference only and are not to be considered a part
hereof and shall not in any way modify or restrict the terms hereof. This Agreement and all of the
terms and provisions hereof shall be liberally construed to effectuate the purposes set forth herein and
to achieve the intended purpose of providing for the refunding of the Refunded Obligations in
accordance with applicable law.
ARTICLE II
DEPOSIT OF FUNDS AND
ESCROWED SECURITIES
Section 2.01. Deposits in the Escrow Fund. Concurrently with the sale and delivery of the
Refunding Obligations the Issuer shall deposit, or cause to be deposited, with the Escrow Agent, for
deposit in the Escrow Fund, the funds and Escrowed Securities described in the Report, and the
Escrow Agent shall, upon the receipt thereof, acknowledge such receipt to the Issuer in writing.
RROCK/OOAndRefgBonds2O04: Fsaro Agm ment 3
ARTICLE III
CREATION AND OPERATION OF ESCROW FUND
Section 3.01. Escrow Fund. The Escrow Agent has created on its books a special trust fund
and irrevocable escrow to be known as the Issuer's Refunded Obligations Escrow Fund (the "Escrow
Fund"). The Escrow Agent hereby agrees that upon receipt thereof it will irrevocably deposit to the
credit of the Escrow Fund the funds and the Escrowed Securities described in the Report. Such
deposit, all proceeds therefrom, and all cash balances from time to time on deposit therein (a) shall
be the property of the Escrow Fund, (b) shall be applied only in strict conformity with the terms and
conditions of this Agreement, and (c) are hereby irrevocably pledged to the payment of the principal
of and interest on the Refunded Obligations, which payment shall be made by timely transfers of such
amounts at such times as are provided for in Section 3.02 hereof. When the final transfers have been
made for the payment of such principal of and interest on the Refunded Obligations, any balance then
remaining in the Escrow Fund shall be transferred to the Issuer, and the Escrow Agent shall
thereupon be discharged from any further duties hereunder.
Section 3.02. Payment of Principal and Interest. The Escrow Agent is hereby irrevocably
instructed to transfer from the cash balances from time to time on deposit in the Escrow Fund, the
amounts required to pay the principal of the Refunded Obligations at their respective maturity dates
and interest thereon to such maturity dates in the amounts and at the times shown in the Report.
Section 3.03. Sufficiency of Escrow Fund. The Issuer represents that the successive
receipts of the principal of and interest on the Escrowed Securities will assure that the cash balance
on deposit from time to time in the Escrow Fund will be at all times sufficient to provide moneys for
transfer to the Paying Agent at the times and in the amounts required to pay the interest on the
Refunded Obligations as such interest comes due and the principal of the Refunded Obligations as
the Refunded Obligations mature, all as more fully set forth in the Report. If, for any reason, at any
time, the cash balances on deposit or scheduled to be on deposit in the Escrow Fund shall be insuffi-
cient to transfer the amounts required by each place of payment (paying agent) for the Refunded
Obligations to make the payments set forth in Section 3.02 hereof, the Issuer shall timely deposit in
the Escrow Fund, from any funds that are lawfully available therefor, additional funds in the amounts
required to make such payments. Notice of any such insufficiency shall be given as promptly as
practicable as hereinafter provided, but the Escrow Agent shall not in any manner be responsible for
any insufficiency of funds in the Escrow Fund or the Issuer's failure to make additional deposits
thereto.
Section 3.04. Trust Fund. The Escrow Agent shall hold at all times the Escrow Fund, the
Escrowed Securities and all other assets of the Escrow Fund, wholly segregated from all other funds
and securities on deposit with the Escrow Agent; it shall never allow the Escrowed Securities or any
other assets of the Escrow Fund to be commingled with any other funds or securities of the Escrow
Agent; and it shall hold and dispose of the assets of the Escrow Fund only as set forth herein. The
Escrowed Securities and other assets of the Escrow Fund shall always be maintained by the Escrow
Agent as trust funds for the benefit of the owners of the Refunded Obligations; and a special account
RR0CK/G0AndRcfgHon&2004: Fsa—Agmement 4
thereof shall at all times be maintained on the books of the Escrow Agent. The owners of the
Refunded Obligations shall be entitled to the same preferred claim and first lien upon the Escrowed
Securities, the proceeds thereof, and all other assets of the Escrow Fund to which they are entitled
as owners of the Refunded Obligations. The amounts received by the Escrow Agent under this
Agreement shall not be considered as a banking deposit by the Issuer, and the Escrow Agent shall
have no right to title with respect thereto except as a constructive trustee and Escrow Agent under
the terms of this Agreement. The amounts received by the Escrow Agent under this Agreement shall
not be subject to warrants, drafts or checks drawn by the Issuer or, except to the extent expressly
herein provided, by the Paying Agent.
Section 3.05. Security for Cash Balances. Cash balances from time to time on deposit in
the Escrow Fund shall, to the extent not insured by the Federal Deposit Insurance Corporation or its
successor, be continuously secured by a pledge of direct obligations of, or obligations unconditionally
guaranteed by, the United States of America, having a market value at least equal to such cash
balances.
ARTICLE IV
LIMITATION ON INVESTMENTS
Section 4.01. Except as provided in Sections 3.02, 4.02, 4.03 and 4.04 hereof, the Escrow
Agent shall not have any power or duty to invest or reinvest any money held hereunder, or to make
substitutions of the Escrowed Securities, or to sell, transfer or otherwise dispose of the Escrowed
Securities.
Section 4.02. Reinvestment of Certain Cash Balances in Escrow by Escrow Agent. In
addition to the Escrowed Securities listed in the Report, the Escrow Agent shall reinvest cash
balances shown in the Report in United States Treasury Obligations - State and Local Government
Series with an interest rate equal to zero percent (0%) to the extent such Obligations are available
from the Department of the Treasury. All such re -investments shall be made only from the portion
of cash balances derived from the maturing principal of and interest on Escrowed Securities that are
United States Treasury Certificates of Indebtedness, Notes or Bonds - State and Local Government
Series. All such re -investments shall be acquired on and shall mature on the dates shown on the
Report.
Section 4.03. Substitutions and Reinvestments. At the discretion ofthe Issuer, the Escrow
Agent shall reinvest cash balances representing receipts from the Escrowed Securities, make
substitutions ofthe Escrowed Securities or redeem the Escrowed Securities and reinvest the proceeds
thereof or hold such proceeds as cash, together with other moneys or securities held in the Escrow
Fund provided that the Issuer delivers to the Escrow Agent the following:
(1) an opinion by an independent certified public accountant that after such
substitution or reinvestment the principal amount of the securities in the Escrow Fund (which
shall be noncallable, not pre -payable direct obligations of the United States of America),
RROCK/GOAndRefgBonds20O4: EsmwAgwment
together with the interest thereon and other available moneys, will be sufficient to pay,
without further investment or reinvestment, as the same become due in accordance with the
Report, the principal of, interest on and premium, if any, on the Refunded Obligations which
have not previously been paid, and
(2) an unqualified opinion of nationally recognized municipal bond counsel to the
effect that (a) such substitution or reinvestment will not cause the Refunded Obligations to
be "arbitrage bonds" within the meaning of Section 103 of the Code or the regulations
thereunder in effect on the date of such substitution or reinvestment, or otherwise make the
interest on the Refunded Obligations subject to federal income taxation, and (b) such
substitution or reinvestment complies with the Constitution and laws of the State of Texas
and with all relevant documents relating to the issuance of the Refunded Obligations.
The Escrow Agent shall have no responsibility or liability for loss or otherwise with respect
to investments made at the direction of the Issuer.
Section 4.04. Substitution for Escrowed Securities. Concurrently with the initial deposit
by the Issuer with the Escrow Agent, but not thereafter, the Issuer, at its option, may substitute cash
or non-interest bearing direct noncallable and not pre -payable obligations of the United States
Treasury (i.e., Treasury obligations which mature and are payable in a stated amount on the maturity
date thereof, and for which there are no payments other than the payment made on the maturity date)
(the "Substitute Obligations") for non-interest bearing Escrowed Securities, if any, but only if such
Substitute Obligations
(a) are in an amount, and/or mature in an amount, which is equal to or greater than the
amount payable on the maturity date of the obligation listed in the Report for which
such Substitute Obligation is substituted,
(b) mature on or before the maturity date of the obligation listed in the Report for which
such Substitute Obligation is substituted, and
(c) produce the amount necessary to pay the interest on and principal of the Refunded
Obligations, as set forth in the Report, as verified by a certified public accountant or
a firm of certified public accountants.
If, concurrently with the initial deposit by the Issuer with the Escrow Agent, any such Substitute
Obligations are so substituted for any Escrowed Securities, the Issuer may, at any time thereafter,
substitute for such Substitute Obligations the same Escrowed Securities for which such Substitute
Obligations originally were substituted.
Section 4.05. Arbitrage. The Issuer hereby covenants and agrees that it shall never request
the Escrow Agent to exercise any power hereunder or permit any part of the money in the Escrow
Fund or proceeds from the sale ofEscrowed Securities to be used directly or indirectly to acquire any
securities or obligations if the exercise of such power or the acquisition of such securities or
RR0CK/G0AndRefgBon&2004: EscrowAgm—ent 6
obligations would cause any Refunding Obligations or Refunded Obligations to be an "arbitrage
bond" within the meaning of the Code.
ARTICLE V
APPLICATION OF CASH BALANCES
Section 5.01. In General. Except as provided in Sections 3.02, 4.02, 4.03 and 4.04 hereof,
no withdrawals, transfers, or reinvestment shall be made of cash balances in the Escrow Fund.
ARTICLE VI
RECORDS AND REPORTS
Section 6.01. Records. The Escrow Agent will keep books of record and account in which
complete and correct entries shall be made of all transactions relating to the receipts, disbursements,
allocations and application of the money and Escrowed Securities deposited to the Escrow Fund and
all proceeds thereof, and such books shall be available for inspection at reasonable hours and under
reasonable conditions by the Issuer and the owners of the Refunded Obligations.
Section 6.02. Reports. While this Agreement remains in effect, the Escrow Agent annually
shall prepare and send to the Issuer a written report summarizing all transactions relating to the
Escrow Fund during the preceding year, including, without limitation, credits to the Escrow Fund as
a result of interest payments on or maturities of the Escrowed Securities and transfers from the
Escrow Fund for payments on the Refunded Obligations or otherwise, together with a detailed
statement of all Escrowed Securities and the cash balance on deposit in the Escrow Fund as of the
end of such period.
ARTICLE VII
CONCERNING THE PAYING AGENTS AND ESCROW AGENT
Section 7.01. Representations. The Escrow Agent hereby represents that it has all
necessary power and authority to enter into this Agreement and undertake the obligations and
responsibilities imposed upon it herein, and that it will carry out all of its obligations hereunder.
Section 7.02. Limitation on Liability. The liability of the Escrow Agent to transfer funds
for the payment of the principal of and interest on the Refunded Obligations shall be limited to the
proceeds of the Escrowed Securities and the cash balances from time to time on deposit in the
Escrow Fund. Notwithstanding any provision contained herein to the contrary, neither the Escrow
Agent nor the Paying Agent shall have any liability whatsoever for the insufficiency of funds from
time to time in the Escrow Fund or any failure of the obligors of the Escrowed Securities to make
RROCK/GOAndRefgBonds2O04: FsuowAgmemen[
timely payment thereon, except for the obligation to notify the Issuer as promptly as practicable of
any such occurrence.
The recitals herein and in the proceedings authorizing the Refunding Obligations shall be taken
as the statements of the Issuer and shall not be considered as made by, or imposing any obligation or
liability upon, the Escrow Agent. The Escrow Agent is not a party to the proceedings authorizing
the Refunding Obligations or the Refunded Obligations and is not responsible for nor bound by any
of the provisions thereof (except as a place of payment and paying agent and/or a Paying Agent/ -
Registrar therefor). In its capacity as Escrow Agent, it is agreed that the Escrow Agent need look
only to the terms and provisions of this Agreement.
The Escrow Agent makes no representations as to the value, conditions or sufficiency of the
Escrow Fund, or any part thereof, or as to the title of the Issuer thereto, or as to the security afforded
thereby or hereby, and the Escrow Agent shall not incur any liability or responsibility in respect to
any of such matters.
It is the intention of the parties hereto that the Escrow Agent shall never be required to use
or advance its own funds or otherwise incur personal financial liability in the performance of any of
its duties or the exercise of any of its rights and powers hereunder.
The Escrow Agent shall not be liable for any action taken or neglected to be taken by it in
good faith in any exercise of reasonable care and believed by it to be within the discretion or power
conferred upon it by this Agreement, nor shall the Escrow Agent be responsible for the consequences
of any error of judgment; and the Escrow Agent shall not be answerable except for its own action,
neglect or default, nor for any loss unless the same shall have been through its negligence or willful
misconduct.
Unless it is specifically otherwise provided herein, the Escrow Agent has no duty to determine
or inquire into the happening or occurrence of any event or contingency or the performance or failure
of performance of the Issuer with respect to arrangements or contracts with others, with the Escrow
Agent's sole duty hereunder being to safeguard the Escrow Fund, to dispose of and deliver the same
in accordance with this Agreement. If, however, the Escrow Agent is called upon by the terms of this
Agreement to determine the occurrence of any event or contingency, the Escrow Agent shall be obli-
gated, in making such determination, only to exercise reasonable care and diligence, and in event of
error in making such determination the Escrow Agent shall be liable only for its own willful
misconduct or its negligence. In determining the occurrence of any such event or contingency the
Escrow Agent may request from the Issuer or any other person such reasonable additional evidence
as the Escrow Agent in its discretion may deem necessary to determine any fact relating to the
occurrence of such event or contingency, and in this connection may make inquiries of, and consult
with, among others, the Issuer at any time.
Section 7.03. Compensation. (a) Concurrently with the sale and delivery of the Refunding
Obligations, the Issuer shall pay to the Escrow Agent, as a fee for performing the services hereunder
and for all expenses incurred or to be incurred by the Escrow Agent in the administration of this
RROCK/GOAndRefgBonds2004: FsuowAg=ment
Agreement, the sum of $ , the sufficiency of which is hereby acknowledged by the
Escrow Agent. In the event that the Escrow Agent is requested to perform any extraordinary services
hereunder, the Issuer hereby agrees to pay reasonable fees to the Escrow Agent for such extra-
ordinary services and to reimburse the Escrow Agent for all expenses incurred by the Escrow Agent
in performing such extraordinary services, and the Escrow Agent hereby agrees to look only to the
Issuer for the payment of such fees and reimbursement of such expenses. The Escrow Agent hereby
agrees that in no event shall it ever assert any claim or lien against the Escrow Fund for any fees for
its services, whether regular or extraordinary, as Escrow Agent, or in any other capacity, or for
reimbursement for any of its expenses.
(b) The Bank ofNew York Trust Company, N.A. is the place of payment (paying agent)
for the Series 1995 Refunded Obligations. Concurrently with the sale and delivery of the Refunded
Obligations the Issuer shall pay to The Bank ofNew York Trust Company, N.A., the sum of $
which is comprised of a bond call fee of $ and closing out-of-pocket expenses of $, the
sufficiency of which is hereby acknowledged by The Bank of New York Trust Company, N.A., for
all future paying agency services of The Bank ofNew York Trust Company, N.A. for the Series 1995
Refunded Obligations; and The Bank ofNew York Trust Company, N.A. warrants that such sum is
sufficient for such purpose.
(c) JPMorgan Chase Bank is the place of payment (paying agent) for the Series 1996
Refunded Obligations. The Issuer covenants to timely pay for all future paying agency services of
JPMorgan Chase Bank for the Series 1996 Refunded Obligations in accordance with the paying agent
fee schedule now in effect through the final payment of the Series 1996 Refunded Obligations, the
sufficiency of which is hereby acknowledged by JPMorgan Chase Bank.
Section 7.04. Successor Escrow Agents. If at any time the Escrow Agent or its legal
successor or successors should become unable, through operation or law or otherwise, to act as
escrow agent hereunder, or if its property and affairs shall be taken under the control of any state or
federal court or administrative body because of insolvency or bankruptcy or for any other reason, a
vacancy shall forthwith exist in the office of Escrow Agent hereunder. In such event the Issuer, by
appropriate action, promptly shall appoint an Escrow Agent to fill such vacancy. If no successor
Escrow Agent shall have been appointed by the Issuer within 60 days, a successor may be appointed
by the owners of a majority in principal amount of the Refunded Obligations then outstanding by an
instrument or instruments in writing filed with the Issuer, signed by such owners or by their duly
authorized attorneys -in -fact. If, in a proper case, no appointment of a successor Escrow Agent shall
be made pursuant to the foregoing provisions of this section within three months after a vacancy shall
have occurred, the owner of any Refunded Obligation may apply to any court of competent
jurisdiction to appoint a successor Escrow Agent. Such court may thereupon, after such notice, if
any, as it may deem proper, prescribe and appoint a successor Escrow Agent.
Any successor Escrow Agent shall be a corporation organized and doing business under the
laws of the United States or the State of Texas, authorized under such laws to exercise corporate
trust powers, authorized under Texas law to act as an escrow agent, having its principal office and
RR0CK/G0AndRefgBonds2004: Fsa—Agreement
place of business in the State of Texas, having a combined capital and surplus of at least $5,000,000
and subject to the supervision or examination by Federal or State authority.
Any successor Escrow Agent shall execute, acknowledge and deliver to the Issuer and the
Escrow Agent an instrument accepting such appointment hereunder, and the Escrow Agent shall
execute and deliver an instrument transferring to such successor Escrow Agent, subject to the terms
of this Agreement, all the rights, powers and trusts of the Escrow Agent hereunder. Upon the request
of any such successor Escrow Agent, the Issuer shall execute any and all instruments in writing for
more fully and certainly vesting in and confirming to such successor Escrow Agent all such rights,
powers and duties.
The Escrow Agent at the time acting hereunder may at any time resign and be discharged
from the trust hereby created by giving not less than sixty (60) days' written notice to the Issuer and
publishing notice thereof, specifying the date when such resignation will take effect, in a newspaper
printed in the English language and with general circulation in New York, New York, such
publication to be made once at least three (3) weeks prior to the date when the resignation is to take
effect. No such resignation shall take effect unless a successor Escrow Agent shall have been
appointed by the owners of the Refunded Obligations or by the Issuer as herein provided and such
successor Escrow Agent shall be a paying agent for the Refunded Obligations and shall have accepted
such appointment, in which event such resignation shall take effect immediately upon the appointment
and acceptance of a successor Escrow Agent.
Under any circumstances, the Escrow Agent shall pay over to its successor Escrow Agent
proportional parts of the Escrow Agent's fee and, if applicable, its Paying Agent's fee hereunder.
ARTICLE VIII
MISCELLANEOUS
Section 8.01. Notice. Any notice, authorization, request, or demand required or permitted
to be given hereunder shall be in writing and shall be deemed to have been duly given when mailed
by registered or certified mail, postage prepaid addressed to the Issuer or the Escrow Agent at the
address shown on Exhibit "A" attached hereto. The United States Post Office registered or certified
mail receipt showing delivery of the aforesaid shall be conclusive evidence of the date and fact of
delivery. Any party hereto may change the address to which notices are to be delivered by giving to
the other parties not less than ten (10) days prior notice thereof. Prior written notice of any
amendment to this Agreement contemplated pursuant to Section 8.08 and immediate written notice
of any incidence of a severance pursuant to Section 8.04 shall be sent to Moody's Investors Service,
Attn: Public Finance Rating Desk/Refunded Bonds, 99 Church Street, New York, New York 10007
and Standard & Poor's Corporation, Attn: Municipal Bond Department, 25 Broadway, New York,
New York 10004.
Section 8.02. Termination of Responsibilities. Upon the taking of all the actions as
described herein by the Escrow Agent, the Escrow Agent shall have no further obligations or
RROCK/GOAndRefgBonds2004: EsaowAgreement 10
responsibilities hereunder to the Issuer, the owners of the Refunded Obligations or to any other
person or persons in connection with this Agreement.
Section 8.03. Binding Agreement. This Agreement shall be binding upon the Issuer and
the Escrow Agent and their respective successors and legal representatives, and shall inure solely to
the benefit of the owners of the Refunded Obligations, the Issuer, the Escrow Agent and their
respective successors and legal representatives.
Section 8.04. Severability. In case any one or more of the provisions contained in this
Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement, but
this Agreement shall be construed as if such invalid or illegal or unenforceable provision had never
been contained herein.
Section 8.05. Texas Law Governs. This Agreement shall be governed exclusively by the
provisions hereof and by the applicable laws of the State of Texas.
Section 8.06. Time of the Essence. Time shall be of the essence in the performance of
obligations from time to time imposed upon the Escrow Agent by this Agreement.
Section 8.07. Effective date of Agreement. This Agreement shall be effective upon receipt
by the Escrow Agent ofthe funds described in the Report and the Escrowed Securities, together with
the specific sums stated in subsections (a) and (b) of Section 7.03 for Escrow Agent and paying
agency fees, expenses, and services.
Section 8.08. Amendments. This Agreement shall not be amended except to cure any
ambiguity or formal defect or omission in this Agreement. No amendment shall be effective unless
the same shall be in writing and signed by the parties thereto. No such amendment shall adversely
affect the rights of the holders of the Refunded Obligations.
RROCK/GOAndRefgBonds2OO4: Esa—Agreement I 1
EXECUTED as of the date first written above.
ROUND ROCK, TEXAS
0
ATTEST:
City Secretary
(SEAL)
RROCK/GOAndRefgBonds2O04: EsamAgeement
Mayor Pro -tem
JPMORGAN CHASE BANK
By:
Title:
ATTEST:
Title:
(SEAL)
RROCK/GOAndRefgBonds2004: E—owAgeement
Solely for the purpose of acknowledging the provisions in Section 7.03(b).
THE BANK OF NEW YORK
TRUST COMPANY, N.A.
RROCK/GOAndRefgBonds2004: EsaowAgreement
INDEX TO EXHIBITS
Exhibit "A" Addresses of the Issuer and the Escrow Agent
Exhibit "B" Verification Report of Grant Thornton LLP
RROCK/GOAndRefgB-62004: Esa—Agreement
EXHIBIT "A"
ADDRESSES OF THE ISSUER AND THE ESCROW AGENT
ISSUER
City of Round Rock, Texas
221 E. Main Street
Round Rock, Texas 78664
Attention: Director of Finance
ESCROW AGENT
JPMorgan Chase Bank
2001 Bryan Street, IOth Floor
Dallas, Texas 75201
Attention: Issuer Administrative Services
RROCK/GOAndRe£gBonds2004: EsmwAgeement
EXHIBIT "B"
Verification Report
RROCK/GOAndRefgBonds2OO4: EsumAgreement
PAYING AGENT/REGISTRAR AGREEMENT
THIS AGREEMENT dated as of July 15, 2004 ("Agreement"), by and between Round
Rock, Texas (the "Issuer"), and JPMorgan Chase Bank, a New York banking corporation duly
organized and existing under the laws of the State of New York ('Bank").
RECITALS
WHEREAS, the Issuer has duly authorized and provided for the issuance of bonds to be
issued only in registered form, as to payment of principal and interest thereon in an aggregate
principal amount of $ and titled General Obligation and Refunding Bonds, Series 2004
(the 'Bonds"); and
WHEREAS, the Bonds are scheduled to be delivered to the initial purchasers thereof on or
about August 12, 2004; and
WHEREAS, the Issuer has selected the Bank to serve as Paying Agent/Registrar in
connection with the payment of the principal of, premium, if any, and interest on the Bonds and with
respect to the registration, transfer and exchange thereof by the registered owners thereof, and
WHEREAS, the Bank has agreed to serve in such capacities for and on behalf ofthe City and
has full power and authority to perform and serve as Paying Agent/Registrar for the Bonds;
NOW, THEREFORE, it is mutually agreed as follows:
ARTICLE ONE
APPOINTMENT OF BANK AS
PAYING AGENT AND REGISTRAR
Section 1.01. Appointment.
The Issuer hereby appoints the Bank to serve as Paying Agent with respect to the Bonds. As
Paying Agent for the Bonds, the Bank shall be responsible for paying on behalf of the City the
principal, premium (if any), and interest on the Bonds as the same become due and payable to the
registered owners thereof, all in accordance with this Agreement and the "Ordinance" (hereinafter
defined).
The Issuer hereby appoints the Bank as Registrar with respect to the Bonds. As Registrar for
the Bonds, the Bank shall keep and maintain for and on behalf of the Issuer books and records as to
the ownership of the Bonds and with respect to the transfer and exchange thereof as provided herein
and in the "Orders."
RR0CK\G0&R.Vg2004: PAYAGAGR
The Bank hereby accepts its appointment, and agrees to serve as the Paying Agent and
Registrar for the Bonds.
Section 1.02. Compensation.
As compensation for the Bank's services as Paying Agent/Registrar, the Issuer hereby agrees
to pay the Bank the fees and amounts set forth in Schedule A attached hereto.
In addition, the Issuer agrees to reimburse the Bank upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Bank in accordance with any of the
provisions hereof (including the reasonable compensation and the expenses and disbursements of its
agents and counsel).
ARTICLE TWO
DEFINITIONS
Section 2.01. Definitions.
For all purposes of this Agreement, except as otherwise expressly provided or unless the
context otherwise requires:
"Acceleration Date" on any Security means the date on and after which the principal
or any or all installments of interest, or both, are due and payable on any Security which has
become accelerated pursuant to the terms of the Security.
"Bank Office" means the corporate trust office of the Bank as indicated herein. The
Bank will notify the City in writing of any change in location of the Bank Office.
"Fiscal Year" means the fiscal year of the Issuer.
"Holder" and "Bond Holder" each means the Person in whose name a Bond is
registered in the Bond Register.
"Issuer Request" and "Issuer Order" means a written request or order signed in the
name of the Issuer by the Mayor, delivered to the Bank.
"Legal Holiday" means a day on which the Bank is required or authorized to be
closed.
"Ordinance" mean the ordinance of the governing body of the City pursuant to which
the Bonds are issued, certified by the City Secretary or any other officer of the City and
delivered to the Bank.
RR0CK\G0&Rwg2004: PAYAG.AGR 2
"Person" means any individual, corporation, partnership, joint venture, association,
joint stock company, trust, unincorporated organization or government or any agency or
political subdivision of a government.
"Predecessor Bonds" of any particular Bond means every previous Bond evidencing
all or a portion of the same obligation as that evidenced by such particular Bond (and, for the
purposes of this definition, any mutilated, lost, destroyed, or stolen Bond for which a
replacement Bond has been registered and delivered in lieu thereof pursuant to Section 4.06
hereof and the Ordinance).
"Redemption Date" when used with respect to any Bond to be redeemed means the
date fixed for such redemption pursuant to the terms of the Ordinance.
"Responsible Officer" when used with respect to the Bank means the Chairman or
Vice -Chairman of the Board of Directors, the Chairman or Vice -Chairman of the Executive
Committee of the Board of Directors, the President, any Vice President, the Secretary, any
Assistant Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any Assistant
Cashier, any Trust Officer or Assistant Trust Officer, or any other officer of the Bank
customarily performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter, any other officer
to whom such matter is referred because of his knowledge of and familiarity with the
particular subject.
"Bond Register" means a register maintained by the Bank on behalf of the City
providing for the registration and transfer of the Bonds.
"Stated Maturity" means the date specified in the Ordinance on which the principal
of a Bond is scheduled to be due and payable.
Section 2.02. Other Definitions.
The terms 'Bank," "Issuer," and 'Bonds" have the meanings assigned to them in the recital
paragraphs of this Agreement.
The term "Paying Agent/Registrar" refers to the Bank in the performance of the duties and
functions of this Agreement.
RROCK\GO&R,rg20O4: PAYAGAGR
ARTICLE THREE
PAYING AGENT
Section 3.01. Duties of Paying Agent.
As Paying Agent, the Bank shall, provided adequate collected funds have been provided to
it for such purpose by or on behalf of the Issuer, pay on behalf of the Issuer the principal of each
Bond at its Stated Maturity, Redemption Date, or Acceleration Date, to the Holder upon surrender
of the Bond to the Bank at the Bank Office.
As Paying Agent, the Bank shall, provided adequate collected funds have been provided to
it for such purpose by or on behalf of the Issuer, pay on behalf of the Issuer the interest on each Bond
when due, by computing the amount of interest to be paid each Holder and preparing and sending
checks by United States Mail, first class postage prepaid, on each payment date, to the Holders of
the Bonds (or their Predecessor Bonds) on the respective Record Date, to the address appearing on
the Bond Register or by such other method, acceptable to the Bank, requested in writing by the
Holder at the Holder's risk and expense.
Section 3.02. Payment Dates.
The Issuer hereby instructs the Bank to pay the principal of and interest on the Bonds on the
dates specified in the Orders.
ARTICLE FOUR
REGISTRAR
Section 4.01. Bond Register - Transfers and Exchanges.
The Bank agrees to keep and maintain for and on behalf of the Issuer at the Bank Office
books and records (herein sometimes referred to as the "Bond Register") for recording the names and
addresses of the Holders of the Bonds, the transfer, exchange and replacement of the Bonds and the
payment of the principal of and interest on the Bonds to the Holders and containing such other
information as may be reasonably required by the Issuer and subject to such reasonable regulations
as the Issuer and the Bank may prescribe. All transfers, exchanges and replacement of Bonds shall
be noted in the Bond Register.
Every Bond surrendered for transfer or exchange shall be duly endorsed or be accompanied
by a written instrument of transfer, the signature on which has been guaranteed by an officer of a
federal or state bank or a member of the National Association of Bond Dealers, Inc., in form
satisfactory to the Bank, duly executed by the Holder thereof or his agent duly authorized in writing.
The Bank may request any supporting documentation it feels necessary to effect a
re -registration, transfer or exchange of the Bonds.
RRGCK\GG&Ref g2004: PAYAGAGR 4
To the extent possible and under reasonable circumstances, the Bank agrees that, in relation
to an exchange or transfer of Bonds, the exchange or transfer by the Holders thereof will be
completed and new Bonds delivered to the Holder or the assignee of the Holder in not more than
three (3) business days after the receipt of the Bonds to be canceled in an exchange or transfer and
the written instrument of transfer or request for exchange duly executed by the Holder, or his duly
authorized agent, in form and manner satisfactory to the Paying Agent/Registrar.
Section 4.02. Bonds.
The Issuer shall provide an adequate inventory of printed Bonds to facilitate transfers or
exchanges thereof. The Bank covenants that the inventory of printed Bonds will be kept in
safekeeping pending their use, and reasonable care will be exercised by the Bank in maintaining such
Bonds in safekeeping, which shall be not less than the care maintained by the Bank for debt Bonds
of other political subdivisions or corporations for which it serves as registrar, or that is maintained
for its own securities.
Section 4.03. Form of Bond Register.
The Bank, as Registrar, will maintain the Bond Register relating to the registration, payment,
transfer and exchange of the Bonds in accordance with the Bank's general practices and procedures
in effect from time to time. The Bank shall not be obligated to maintain such Bond Register in any
form other than those which the Bank has currently available and currently utilizes at the time.
The Bond Register may be maintained in written form or in any other form capable of being
converted into written form within a reasonable time.
Section 4.04. List of Bond Holders.
The Bank will provide the Issuer at any time requested by the Issuer, upon payment of the
required fee, a copy of the information contained in the Bond Register. The Issuer may also inspect
the information contained in the Bond Register at any time the Bank is customarily open for business,
provided that reasonable time is allowed the Bank to provide an up-to-date listing or to convert the
information into written form.
The Bank will not release or disclose the contents of the Bond Register to any person other
than to, or at the written request of, an authorized officer or employee of the Issuer, except upon
receipt of a court order or as otherwise required by law. Upon receipt of a court order and prior to
the release or disclosure of the contents of the Bond Register, the Bank will notify the Issuer so that
the Issuer may contest the court order or such release or disclosure of the contents of the Bond
Register.
RROMGO&.Rerg2004: PAYAGAGR
Section 4.05. Return of Cancelled Bonds.
The Bank will, at such reasonable intervals as it determines, surrender to the Issuer, Bonds
in lieu of which or in exchange for which other Bonds have been issued, or which have been paid.
Section 4.06. Mutilated, Destroyed, Lost or Stolen Bonds.
The Issuer hereby instructs the Bank, subject to the applicable provisions of the Orders, to
deliver and issue Bonds in exchange for or in lieu of mutilated, destroyed, lost, or stolen Bonds as
long as the same does not result in an overissuance.
In case any Bond shall be mutilated, or destroyed, lost or stolen, the Bank, in its discretion,
may execute and deliver a replacement Bond of like form and tenor, and in the same denomination
and bearing a number not contemporaneously outstanding, in exchange and substitution for such
mutilated Bond, or in lieu of and in substitution for such destroyed lost or stolen Bond, only after (1)
the filing by the Holder thereof with the Bank of evidence satisfactory to the Bank of the destruction,
loss or theft of such Bond, and of the authenticity of the ownership thereof and (ii) the furnishing to
the Bank of indemnification in an amount satisfactory to hold the Issuer and the Bank harmless. All
expenses and charges associated with such indemnity and with the preparation, execution and delivery
of a replacement Bond shall be borne by the Holder of the Bond mutilated, or destroyed, lost or
stolen.
Section 4.07. Transaction Information to Issuer.
The Bank will, within a reasonable time after receipt of written request from the Issuer,
furnish the Issuer information as to the Bonds it has paid pursuant to Section 3.01, Bonds it has
delivered upon the transfer or exchange of any Bonds pursuant to Section 4.01, and Bonds it has
delivered in exchange for or in lieu of mutilated, destroyed, lost, or stolen Bonds pursuant to Section
4.06.
ARTICLE FIVE
THE BANK
Section 5.01. Duties of Bank.
The Bank undertakes to perform the duties set forth herein and agrees to use reasonable care
in the performance thereof.
Section 5.02. Reliance on Documents, Etc.
(a) The Bank may conclusively rely, as to the truth of the statements and correctness of
the opinions expressed therein, on Bonds or opinions furnished to the Bank.
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(b) The Bank shall not be liable for any error of judgment made in good faith by a
Responsible Officer, unless it shall be proved that the Bank was negligent in ascertaining the pertinent
facts.
(c) No provisions ofthis Agreement shall require the Bank to expend or risk its own funds
or otherwise incur any financial liability for performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment
of such funds or adequate indemnity satisfactory to it against such risks or liability is not assured to
it.
(d) The Bank may rely and shall be protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, note, bond, or other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties. Without limiting the generality of the foregoing
statement, the Bank need not examine the ownership of any Bonds, but is protected in acting upon
receipt of Bonds containing an endorsement or instruction of transfer or power of transfer which
appears on its face to be signed by the Holder or an agent of the Holder. The Bank shall not be
bound to make any investigation into the facts or matters stated in a resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond, note, bond, or other
paper or document supplied by Issuer.
(e) The Bank may consult with counsel, and the written advice of such counsel or any
opinion of counsel shall be full and complete authorization and protection with respect to any action
taken, suffered, or omitted by it hereunder in good faith and in reliance thereon.
(f) The Bank may exercise any ofthe powers hereunder and perform any duties hereunder
either directly or by or through agents or attorneys of the Bank.
Section 5.03. Recitals of Issuer.
The recitals contained herein with respect to the Issuer and in the Bonds shall be taken as the
statements of the Issuer, and the Bank assumes no responsibility for their correctness.
The Bank shall in no event be liable to the Issuer, any Holder or Holders of any Bond, or any
other Person for any amount due on any Bond from its own funds.
Section 5.04. May Hold Bonds.
The Bank, in its individual or any other capacity, may become the owner or pledgee ofBonds
and may otherwise deal with the Issuer with the same rights it would have if it were not the Paying
Agent/Registrar, or any other agent.
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Section 5.05. Moneys Held by Bank.
The Bank shall deposit any moneys received from the Issuer into a trust account to be held
in a paying agency capacity for the payment of the Bonds, with such moneys in the account that
exceed the deposit insurance available to the Issuer by the Federal Deposit Insurance Corporation to
be fully collateralized with Bonds or obligations that are eligible under the laws of the State of Texas
to secure and be pledged as collateral for trust accounts, until the principal and interest on such Bonds
have been presented for payment and paid to the owner thereof. Payments made from such trust
account shall be made by check drawn on such trust account unless the owner of such Bonds shall,
at its own expense and risk, request such other medium of payment.
Subject to the Unclaimed Property Laws of the State of Texas, any money deposited with the
Bank for the payment of the principal, premium (if any), or interest on any Bond and remaining
unclaimed for three years after the final maturity of the Bond has become due and payable will be paid
by the Bank to the Issuer if the Issuer so elects, and the Holder of such Bond shall hereafter look only
to the Issuer for payment thereof, and all liability of the Bank with respect to such monies shall
thereupon cease. If the Issuer does not elect, the Bank is directed to report and dispose of the funds
in compliance with Title Six of the Texas Property Code, as amended.
Section 5.06. Indemnification.
To the extent permitted by law, the Issuer agrees to indemnify the Bank for, and hold it
harmless against, any loss, liability, or expense incurred without negligence or bad faith on the Bank's
part, arising out of or in connection with the Bank's acceptance or administration of its duties
hereunder, including the cost and expense incurred by the Bank in defending against any claim or
from liability imposed on the Bank in connection with the Bank's exercise or performance of any of
its powers or duties under this Agreement.
Section 5.07. Interpleader.
The Issuer and the Bank agree that the Bank may seek adjudication of any adverse claim,
demand, or controversy over its person as well as funds on deposit, in either a Federal or State Issuer
Court located in the State of Texas and County where either the Bank Office or the administrative
offices ofthe Issuer is located, and agree that service ofprocess by certified or registered mail, return
receipt requested, to the address referred to in Section 6.03 of this Agreement shall constitute
adequate service. The Issuer and the Bank further agree that the Bank has the right to file a Bill of
Interpleader in any court of competent jurisdiction in the State of Texas to determine the rights of any
Person claiming any interest herein.
Section 5.08. De op sitory Trust Company Services.
It is hereby represented and warranted that, in the event the Bonds are otherwise qualified and
accepted for "Depository Trust Company" services or equivalent depository trust services by other
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organizations, the Bank has the capability and, to the extent within its control, will comply with the
"Operational Arrangements," effective August 1, 1987, which establishes requirements for Bonds to
be eligible for such type depository trust services, including, but not limited to, requirements for the
timeliness of payments and funds availability, transfer turnaround time, and notification of
redemptions and calls.
Attached hereto is a copy ofthe Blanket Issuer Letter ofRepresentations with The Depository
Trust Company.
ARTICLE SIX
MISCELLANEOUS PROVISIONS
Section 6.01. Amendment.
This Agreement maybe amended only by an agreement in writing signed by both of the parties
hereto.
Section 6.02. Assignment.
This Agreement may not be assigned by either party without the prior written consent of the
other.
Section 6.03. Notices.
Any request, demand, authorization, direction, notice, consent, waiver, or other document
provided or permitted hereby to be given or furnished to the Issuer or the Bank shall be mailed or
delivered to the Issuer or the Bank, respectively, at the addresses shown on the signature page of this
Agreement.
Section 6.04. Effect of Headings.
The Article and Section headings herein are for convenience only and shall not affect the
construction hereof.
Section 6.05. Successors and Assigns.
All covenants and agreements herein by the Issuer shall bind its successors and assigns,
whether so expressed or not.
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Section 6.06. Severability.
In case any provision herein shall be invalid, illegal, or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
Section 6.07. Benefits of Agreement.
Nothing herein, express or implied, shall give to any Person, other than the parties hereto and
their successors hereunder, any benefit or any legal or equitable right, remedy, or claim hereunder.
Section 6.08. Entire Agreement.
This Agreement and the Orders constitute the entire agreement between the parties hereto
relative to the Bank acting as Paying Agent/Registrar and if any conflict exists between this
Agreement and the Orders, the Orders shall govern.
Section 6.09. Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be
deemed an original and all of which shall constitute one and the same Agreement.
Section 6.10. Termination.
This Agreement will terminate (i) on the date of final payment of the principal of and interest
on the Bonds to the Holders thereof or (ii) may be earlier terminated by either party upon sixty (60)
days written notice; provided, however, an early termination of this Agreement by either party shall
not be effective until (a) a successor Paying Agent/Registrar has been appointed by the Issuer and
such appointment accepted and (b) notice has been given to the Holders of the Bonds of the
appointment of a successor Paying Agent/Registrar. Furthermore, the Bank and Issuer mutually
agree that the effective date of an early termination of this Agreement shall not occur at any time
which would disrupt, delay or otherwise adversely affect the payment of the Bonds. However, upon
resignation or termination, the Bank reserves the right, after 30 days, to petition a court of competent
jurisdiction to appoint a successor.
Upon an early termination of this Agreement, the Bank agrees to promptly transfer and deliver
the Bond Register (or a copy thereof), together with other pertinent books and records relating to
the Bonds, to the successor Paying Agent/Registrar designated and appointed by the Issuer.
The provisions of Section 1.02 and of Article Five shall survive and remain in full force and
effect following the termination of this Agreement.
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Section 6.11. Governing Law.
This Agreement shall be construed in accordance with and governed by the laws of the State
of Texas.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year first above written.
JPMORGAN CHASE BANK
By:_
Title:
2001 Bryan Street, 10th Floor
Dallas, Texas 75201
Attest:
Title
[BANK SEAL]
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ROUND ROCK, TEXAS
By:
Mayor Pro -tem
221 E. Main Street
Round Rock, Texas 78664
[ISSUER SEAL]
Attest:
City Secretary
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SCHEDULE A
Paying Agent/Registrar Fee Schedule
Acceptance Fee $ -0-
Annual Administration Fee $ 300
RROCK\GO&Refg2004: P"AG.AGR A— I
DATE: July 16, 2004
SUBJECT: City Council Meeting - July 22, 2004
ITEM: 12.A.1. Consider an ordinance authorizing the issuance of City of Round
Rock, Texas General Obligation and Refunding Bonds, Series 2004;
levying an ad valorem tax in support of the bonds; approving a
paying agent/registrar agreement, an official statement, a bond
purchase agreement and an escrow agreement; calling certain
obligations for redemption and authorizing other matters relating to
bonds. (Only one reading is required as authorized in Section
1201.028 Texas Local Government Code.)
Department: Finance Department
Staff Person: David Kautz, Assistant City Manager/Chief Financial Officer
Cindy Demers, Finance Director
Justification:
The City is selling General Obligation bonds in the amount of $20 million for new project
financing. The $20 million is the 2nd issuance of the $89.8 million authorization approved by
voters in November 2001. The City previously issued $35 million of this authorization. Once
this transaction is complete, $34.8 million will remain in authorized but unissued general
obligation bonds. The refunding transaction is estimated to refund up to $18 million in existing
bonds and will provide a present value savings due to lower market interest rates and for a
restructuring of current outstanding bonds.
The issuance of these obligations is not expected to adversely affect the City's excellent credit
rating because of the City's strong financial position and debt capacity.
Funding:
Cost: N/A
Source of funds: N/A
Outside Resources: McCall, Parkhurst & Horton, L.L.P., Bond Counsel
First Southwest Company, Financial Advisors
Public Comment: N/A