G-97-11-25-9D - 11/25/1997Ordinance No. 4 "C11" 11 .. t5" ? D
ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF ROUND ROCK, TEXAS
GENERAL OBLIGATION REFUNDING BONDS, SERIES 1997; LEVYING AN AD
VALOREM TAX IN SUPPORT OF THE BONDS; APPROVING AN OFFICIAL
STATEMENT; AUTHORIZING THE EXECUTION OF A PURCHASE AGREEMENT,
A PAYING AGENT/REGISTRAR AGREEMENT, A LETTER OF
REPRESENTATIONS, AND AN ESCROW AGREEMENT; MAKING CERTAIN
CONTINUING DISCLOSURE COVENANTS UNDER RULE 15c2-12; CALLING
CERTAIN OBLIGATIONS FOR REDEMPTION AND ORDAINING OTHER
MATTERS RELATING TO THE ISSUANCE OF THE BONDS
THE STATE OF TEXAS §
COUNTIES OF WILLIAMSON AND TRAVIS §
CITY OF ROUND ROCK §
WHEREAS, the City now desires to refund certain of its outstanding obligations, to wit: a
portion of the Series 1995 Certificates of Obligation, maturing in the years 2012 through 2025 in the
aggregate principal amount of $3,795,000; the Series 1990 Certificates of Obligation maturing in the
years 2002 and 2010 in the aggregate principal amount of $225,000; the Series 1988 Certificates of
Obligation maturing in the year 2004 in the aggregate principal amount of $225,000; and the Series
1987 Certificates of Obligation maturing in the years 2000 and 2004 through 2006 in the aggregate
principal amount of $630,000 (collectively, the "Refunded Obligations"); and
WHEREAS, the City Council of the City deems it advisable to refund the Refunded
Obligations in order to achieve a present value savings of approximately $146,562.88 and a gross
debt service savings of $138,059.87; and
WHEREAS, Article 717k, Texas Annotated Revised Civil Statutes, as amended ("Article
717k") 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, Article 717k 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 direct obligations of the United States of America including obligations the principal of and interest
on which are unconditionally guaranteed by the United States of America, and which shall mature and
bear interest payable at such times and in such amounts as will be sufficient to provide for the
scheduled payment or prepayment of the Refunded Obligations; and
RROCKJ: ORDIN2.AUT 11/20/97
WHEREAS, the Escrow Agreement hereinafter authorized, constitutes an agreement of the
kind authorized and permitted by Article 717k; 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
WHEREAS, the City deems it appropriate to call for redemption the following Refunded
Obligations:
REFUNDED OBLIGATION REDEMPTION DATE REDEMPTION PRICE
A portion of the Series 1995 June 1, 2005 Par
Certificates of Obligation maturing
on June 1 in the years 2012
through 2025 ($3,795,000)
Series 1990 Certificates of August 1, 2000 Par
Obligation maturing on August 1
in the years 2002 and 2010
($225,000)
Series 1988 Certificates of August 1, 1998 Par
Obligation maturing on August 1,
2004 ($225,000)
Series 1987 Certificates of February 1, 1998 Par
Obligation maturing on February 1
in the years 2000 and 2004
through 2006 ($630,000)
NOW,'1HEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
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 and delivered
in the aggregate principal amount of $5,300,000, for the purpose of providing funds to: (i) refund
the Refunded Obligations and (ii) pay the costs of issuance in connection with the Bonds.
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 REFUNDING BOND,
SERIES 1997" and initially there shall be issued, sold, and delivered hereunder fully registered
bonds, without interest coupons, dated November 15, 1997, in the respective denominations and
principal amounts hereinafter stated, numbered consecutively from R-1 upward (except the initial
Bonds submitted to the Attorney General of the State of Texas which will be numbered T-1 upward),
payable to the respective initial registered owners thereof (as designated in Section 13 hereof), or to
RPOCR,: ORDIN2.AUT 1U20/97
2
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 1 in each of the
years and in the principal amounts, respectively, as set forth in the following schedule:
YEARS AMOUNTS YEARS AMOUNTS
2000 $105,000 2013 $295,000
2001 25,000 2014 310,000
2002 110,000 2015 325,000
2003 25,000 2016 220,000
2004 410,000 2017 230,000
2005 195,000 2018 * * * *
2006 205,000 2019 * * * *
2007 20,000 2020 * * * *
2008 20,000 2021 * * * *
2009 20,000 2022 * * * *
2010 170,000 2023 * * * *
2011 25,000 2024 * * * *
2012 285,000 2025 2,305,000
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:
RROCIU. ORDIN2.AUT 11/20/97
3
YEARS RATES YEARS RATES
2000 4.10% 2013 5.10%
2001 4.20 2014 5.15
2002 4.30 2015 5.20
2003 4.40 2016 5.25
2004 4.50 2017 5.25
2005 4.60 2018 * * *
2006 4.70 2019 * * *
2007 4.80 2020 * * *
2008 4.90 2021 * * *
2009 5.00 2022 * * *
2010 5.00 2023 * * *
2011 5.00 2024
2012 5.10 2025 5.375
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 Exchange; Authentication. The City shall keep or cause to be kept at Texas
Commerce Bank National Association, 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 regulations 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 for making such registration, transfer, conversion, exchange and delivery of a substitute Bond
RROCK/: ORDIN2.AUT 11/20/97
4
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 ordinances, orders, or resolutions need be passed or adopted by the
governing 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 Article 717k-6, Texas Annotated Revised Civil Statutes,
as amended, and particularly Section 6 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 of Public 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 (30) 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
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.
RROCK/. ORINN2.AUT 11/20/97
5
(d) Substitute Paying 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 -Entry -Only System. 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 (0 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
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
MOCK!: ()RUIN2.AUT 11120!97
6
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 Bonds, 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 the 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) Initial Bonds(s). The Bonds herein authorized shall be initially issued as fully registered
Bonds, being one Bond for each maturity in the denomination of the applicable principal amount and
the initial Bond(s) shall be registered in the names of the underwriter or the designees thereof as set
forth in Section 13 hereof. The initial Bond(s) shall be the Bonds submitted to the Office of the
Attorney General of the State of Texas for approval, certified and registered by the Office of the
Comptroller of Public Accounts of the State of Texas and delivered to the underwriter as set forth
in Section 13. Immediately after the delivery of the initial Bond(s), the Paying Agent/Registrar shall
cancel the initial Bond(s) delivered hereunder and exchange therefor Bonds 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 DTC and except as provided in Section 4(f), all of the outstanding Bonds shall be
registered in the name of Cede & Co., as nominee of DTC.
Section 5. FORM OF BOND. The form of the Bond, including the form of Paying
Agent/Registrar's Authentication Certificate, the form of Assignment and the form of Registration
Certificate of the Comptroller of Public Accounts of the State of Texas to be attached to the Bonds
RROCK/: URUIN2.AUT 11/20/97
7
initially issued and delivered pursuant to this Ordinance, shall be, respectively, 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 PRINCIPAL
STATE OF TEXAS AMOUNT
WILLIAMSON AND TRAVIS COUNTIES $
CITY OF ROUND ROCK, TEXAS
GENERAL OBLIGATION REFUNDING BOND
SERIES 1997
INTEREST RATE DATE OF BONDS
November 15, 1997
REGISTERED OWNER:
PRINCIPAL AMOUNT:
MATURITY DATE CUSIP NO.
DOLLARS
ON THE MATURITY DATE specified above, CITY OF ROUND ROCK, TEXAS in
Williamson and Travis Counties, 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 November 15, 1997, on February 1, 1998 and semiannually thereafter on each August
1 and February 1 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 such next following interest payment date; provided, how-
ever, 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.
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
RROCK/: ORDIN2.AUT 11/20/97
8
upon the date fixed for its redemption prior to maturity, at Texas Commerce Bank National
Association (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 15th 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. 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, payments made
to the securities depository, or its nominee, shall be made in accordance with 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
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
Designated Payment/Transfer 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 November 15, 1997, authorized in accordance
with the Constitution and laws of the State of Texas in the principal amount of $5,300,000 FOR
THE PURPOSE OF PROVIDING FUNDS TO: (i) REFUND CERTAIN REFUNDED
OBLIGATIONS AND (ii) PAY THE COSTS OF ISSUANCE IN CONNECTION WITH THE
BONDS.
IUWCKI: ORDIN2.AUT 11/20/97
9
ON AUGUST 1, 2007, or on any date thereafter, the Bonds of this Series maturing on and
after August 1, 2008 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, except as provided below, 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).
THE BONDS MATURING ON AUGUST 1, 2025 are subject to mandatory sinking fund
redemption prior to maturity in the following amounts on the following dates and at a price of par
plus accrued interest to the redemption date. The principal amount of $340,000 remaining after
application of the sinking fund redemptions shall be payable on maturity.
Bonds Maturing on August 1, 2025
Redemption Date Principal Amount
August 1, 2018 $240,000
August 1, 2019 250,000
August 1, 2020 265,000
August 1, 2021 280,000
August 1, 2022 290,000
August 1, 2023 310,000
August 1, 2024 330,000
THE PRINCIPAL AMOUNT of the Bonds required to be redeemed pursuant to the
operation of the mandatory sinking fund redemption provisions shall be reduced, at the option of the
City by the principal amount of any Bonds of the stated maturity which, at least 50 days prior to a
mandatory redemption date, (1) shall have been acquired by the City at a price not exceeding the
principal amount of such Bonds plus accrued interest to the date of purchase thereof, and delivered
to the Paying Agent/Registrar for cancellation, (2) shall have been purchased and cancelled by the
Paying Agent/Registrar at the request of the City with monies in the Interest and Sinking Fund at a
price not exceeding the principal amount of the Bonds plus accrued interest to the date of purchase
thereof, or (3) shall have been redeemed pursuant to the optional redemption provisions and not
theretofore credited against a mandatory sinking fund redemption requirement.
IF LESS THAN ALL BONDS maturing on a maturity date are called for redemption, the
Bonds selected within such maturity shall be chosen by lot by the Paying Agent/Registrar (provided
that a portion of a Bond may be redeemed only in an integral multiple of $5,000 principal amount);
provided, that 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.
NO LESS THAN 30 days prior to the date fixed for any such redemption, the City shall
RROCK/: ORDIN2.AUT 11/2097
10
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
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 may be, upon surrender of this 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.
MOCK/: 01U)IN3 AUT II/30/47
11
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.
EN 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 of this 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 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 Mayor
[CITY SEAL]
RROCK/. URUIN7.AUT 11120/97
12
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)
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 Texas Commerce Bank National Association
Paying Agent/Registrar
PAOCK/: ORD1N2.AUT 11130/97
By
Authorized Representative
13
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 of the within
Bond on the books kept for registration thereof, with full power of substitution in the premises.
Dated:
Signature Guaranteed:
NOTICE: Signature(s) must be
guaranteed by a member firm of
the New York Stock Exchange or
a commercial bank or trust company.
RROCK/: ORD1Nl.AUT 1120/97
14
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 of the State of Texas, and that this Bond has been registered by the Comptroller
of Public Accounts of the State of Texas.
Witness my signature and seal this
Comptroller of Public Accounts
of the State of Texas
[COMPTROLLER'S SEAL]
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.
Section 7. ESTABLISHMENT OF ESCROW FUND AND ACCRUED INTEREST.
(a) Escrow Fund. Proceeds of the Bonds, exclusive of accrued interest, shall be deposited in the
Escrow Fund as set forth in the Closing Instruction Letter prepared by the Director of Finance which
fund is created and governed by the terms of the Escrow Agreement dated November 15, 1997
attached hereto as Exhibit A.
RROCK/: ORDIN2.AUT/1120/97
15
(b) Accrued Interest. Proceeds of the Bonds representing accrued interest shall be deposited
in the Interest and Sinking Fund.
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 subsection (d) of this Section 8, when payment of the
principal of such Bond, plus interest thereon to the due date either (i) shall have been made or caused
to be made in accordance with the terms thereof, 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 for
such payment (1) lawful money of the United States of America sufficient to make such payment, (2)
Government Obligations which 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 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 here-
under, 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 and pledged as provided in this
Ordinance, and such principal and interest shall be payable solely from such money or Government
Obligations.
(b) Any moneys so deposited with the Paying Agent/Registrar may at the written direction
of the City also be invested in Government Obligations, maturing in the amounts and times as herein-
before set forth, and all income from such Government Obligations received by the Paying
Agent/Registrar which is not required for the payment of the Bonds and interest thereon, with respect
to which such money has been so deposited, shall be turned over to the City, or deposited as directed
in writing by the City.
(c) The term "Government Obligations" as used in this Section, shall mean direct obligations
of the United States of America, including obligations the principal of and interest on which are
unconditionally guaranteed by the United States of America, which may be United States Treasury
obligations such as its State and Local Government Series, which may be in book -entry form.
(d) 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.
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
RROCKJ: ORDINI. AUT II /AIM
16
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
mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished
as above provided in this Section.
(d) Charge 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 Section 6 of Article 717k-
6, Texas Revised Civil Statutes Annotated, as amended, this Section 9 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 of the 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 of the Registered Owners of the Bonds. In addition, if bond insurance or other credit
PROCK/: ORDINT.AUT 11/20/97
17
enhancement is obtained, the Bonds may bear an appropriate legend.
Section 11. COVENANTS REGARDING TAX EXEMPTION OF INTEREST ON
THE BONDS. 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:
(a) to take any action to assure that no more than 10 percent of the proceeds of the
Bonds or the project 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
than 10 percent of the proceeds are so used, that 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;
(b) to take any action to assure that in the event that the "private business use"
described in subsection (a) hereof exceeds 5 percent of the proceeds of the Bonds (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) of the Code, to the governmental use;
(c) 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;
(d) 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;
(e) 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;
(0 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) of the Code) which produces a
materially higher yield over the term of the Bonds, other than investment property acquired
with --
NROCK/: ORDIN2.AUT II/20197
(1) 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 30 days or less until
such proceeds are needed for the purpose for which the bonds are issued,
18
(2) amounts invested in a bona fide debt service fund, within the meaning of
section 1.148-1(b) of the Treasury Regulations, and
(3) 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;
(g) 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
(h) 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(0 of the Code.
In order to facilitate compliance with the above covenant (h), 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.
For purposes of the foregoing (a) and (b), 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 modification
or expansion, 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.
Section 12. DISPOSITION OF PROJECT. The City covenants that the property financed
with the proceeds of the Refunded Obligations 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
RROCK/: ORDIN2.AUT 11/20197
19
obligated to comply with tis 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 13. SALE OF BONDS. The Bonds are hereby sold and shall be delivered to Legg
Mason Wood Walker, Incorporated, as the representative of the Underwriters, at the price and in
accordance with the terms and provisions of a Purchase Agreement in substantially the form attached
hereto as Exhibit B, which the Mayor of the City is hereby authorized and directed to execute and
deliver and the City Secretary is further authorized and directed to attest such agreement. It is hereby
officially found, determined, and declared that the terms of this sale are the most advantageous
reasonably obtainable. The initial Bonds shall be registered in the name of Legg Mason Wood
Walker, Incorporated.
Section 14. 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 of the Preliminary Official Statement dated October 23,
1997, prior to the date hereof is ratified and confirmed. The City Council of the City hereby finds and
determines that the Preliminary Official Statement and the Official Statement were and are "deemed
final" (as that term is defined in 17 C.F.R. Section 240.15c-12) as of their respective dates.
Section 15. APPROVAL OF ESCROW AGREEMENT, TRANSFER OF FUNDS
AND APPROPRIATION OF FUNDS. The Mayor 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,
City Manager 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, if any, as may be necessary for deposit to the Escrow Fund and to
have sufficient funds to provide for the refunding of the Refunded Obligations.
There is hereby appropriated, from lawfully available funds on hand, amounts necessary to
pay interest on the Bonds on February 15, 1998 and August 15, 1998 and to fund the Escrow Fund,
if necessary.
Section 16. APPROVAL OF PAYING AGENT/REGISTRAR AGREEMENT AND
LETTER OF REPRESENTATIONS. Attached hereto as Exhibit "C" is a substantially final form
of the Paying Agent/Registrar Agreement with a copy of the Blanket Issuer Letter of Representations,
which is currently on file with The Depository Trust Company, attached thereto. Each of the Mayor,
City Manager and Director of Finance are hereby authorized to amend, complete or modify such
agreement and the Letter of Representations as necessary and are further authorized to execute such
agreement and the City Secretary is hereby authorized to attest such agreement.
Section 17. NOTICE 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
RAOCK/: ORDIN2.AUT 11/20/97
20
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, City Manager 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 18. 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 19. 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 ending in or after 1997, financial information and operating data with respect to the
City of the general type included in the final Official Statement authorized by Section 14 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
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:
RROCKI: ORDIN2.AUT 1/120197
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;
21
H.
I.
J.
and
K. Rating changes.
Adverse tax opinions or events affecting the tax-exempt status of the Bonds;
Modifications to rights of holders of the Bonds;
Bond calls;
Defeasances;
Release, substitution, or sale of property securing repayment of the Bonds;
The City shall notify any SID and either each NRMSIR or the MSRB, in a timely manner,
of any failure by the City to provide financial information or operating data in accordance with
Section 19(a) 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, 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.
RRDCK/: ORDIN2.AUT 11120197
22
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 Section 19(a) 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 of the 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.
"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 20. INSURANCE. (a) Insurance Commitment. The COMMITMENT TO ISSUE
A FINANCIAL GUARANTY INSURANCE POLICY (the "Commitment") from MBIA Insurance
Corporation ("MBIA") regarding the issuance of a financial guaranty insurance policy (the "Policy")
with respect to the Bonds is hereby approved and the Mayor is authorized and directed to execute
and deliver the Commitment.
RROCK/: OROIN2.AUT 11(20197
23
(b) Payments Under the Policy.
A. In the event that, on the second business day, and again on the business day, prior to
the payment date on the Bonds, the Paying Agent/Registrar has not received sufficient
moneys to pay all principal of and interest on the Bonds due on such payment date, the
Paying Agent/Registrar shall immediately notify MBIA or its designee on the same Business
Day by telephone or telegraph, confirmed in writing by registered or certified mail, of the
amount of the deficiency.
B. If the deficiency is made up in whole or in part prior to or on the payment date, the
Paying Agent/Registrar shall so notify the MBIA or its designee.
C. In addition, if the Paying Agent/Registrar has notice that any Holder has been required
to disgorge payments of principal or interest on the Bonds to a trustee in Bankruptcy or
creditors or others pursuant to a final judgment by a court of competent jurisdiction that such
payment constitutes an avoidable preference to such Holder within the meaning of any
applicable bankruptcy laws, then the Paying Agent/Registrar shall notify MBIA or its
designee of such fact by telephone or telegraphic notice, confirmed in writing by registered
or certified mail.
D. The Paying Agent/Registrar is hereby irrevocably designated, appointed, directed and
authorized to act as attorney-in-fact for Holders of the Bonds as follows:
UMW: ORUIN3.AUT 11120/97
1. If and to the extent there is a deficiency in amounts required to pay interest
on the Bonds, the Paying Agent/Registrar shall (a) execute and deliver to State Street
Bank and Trust Company, N.A., or its successors under the Policy (the "Insurance
Paying Agent"), in form satisfactory to the Insurance Paying Agent, an instrument
appointing MBIA as agent for such Holders in any legal proceeding related to the
payment of such interest and an assignment to the Insurer of the claims for interest
to which such deficiency relates and which are paid by the Insurer, (b) receive as
designee of the respective Holders (and not as Paying Agent/Registrar) in accordance
with the tenor of the Policy payment from the Insurance Paying Agent with respect
to the claims for interest so assigned, and (c) disburse the same to such respective
Holders; and
2. If and to the extent of a deficiency in amounts required to pay principal of the
Bonds, the Paying Agent/Registrar shall (a) execute and deliver to the Insurance
Paying Agent in form satisfactory to the Insurance Paying Agent an instrument
appointing MBIA as agent for such Holder in any legal proceeding relating to the
payment of such principal and an assignment to MBIA of any of the Bonds
surrendered to the Insurance Paying Agent of so much of the principal amount thereof
as has not previously been paid or for which moneys are not held by the Paying
Agent/Registered and available for such payment (but such assignment shall be
delivered only if payment from the Insurance Paying Agent is received), (b) receive
as designee of the respective Holders (and not as Paying Agent/Registrar) in
accordance with the tenor of the Policy payment therefor from the Insurance Paying
24
Agent, and (c) disburse the same to such Holders.
E. Payments with respect to claims for interest on and principal of Bonds disbursed by
the Paying Agent/Registrar from proceeds of the Policy shall not be considered to discharge
the obligation of the Issuer with respect to such Bonds, and MBIA shall become the owner
of such unpaid Certificate and claims for the interest in accordance with the tenor of the
assignment made to it under the provisions of this subsection or otherwise.
F. Irrespective of whether any such assignment is executed and delivered, the Issuer and
the Paying Agent/Registrar hereby agree for the benefit of MBIA that:
1. They recognize that to the extent MBIA makes payments, directly or
indirectly (as by paying through the Paying Agent/Registrar), on account of principal
of or interest on the Bonds, MBIA will be subrogated to the rights of such Holders
to receive the amount of such principal and interest from the City, with interest
thereon as provided and solely from the sources stated in this Ordinance and the
Bonds, and
2. They will accordingly pay to MBIA the amount of such principal and interest
(including principal and interest recovered under subparagraph (ii) of the first
paragraph of the Policy, which principal and interest shall be deemed past due and not
to have been paid), with interest thereon as provided in this Ordinance and the Bonds,
but only from the sources and in the manner provided herein for the payment of
principal of and interest on the Bonds to Holders, and will otherwise treat MBIA as
the owner of such rights to the amount of such principal and interest.
G. In connection with the issuance of additional obligations, the City shall deliver to
MBIA a copy of the disclosure document, if any, circulated with respect to such additional
obligations.
H. Copies of any amendments made to the documents executed in connection with the
issuance of the Bonds which are consented to by MBIA shall be sent to Standard & Poor's
Corporation.
I. MBIA shall receive notice of the resignation or removal of the Paying Agent/Registrar
and the appointment of a successor thereto.
J. MBIA shall receive copies of all notices required to be delivered to Holders and, on
an annual basis, copies of the City's audited financial statements and annual budget.
K. Notices: Any notice that is required to be given to a holder of the Bonds or to the
Paying Agent/Registrar pursuant to this Ordinance shall also be provided to MBIA. All
notices required to be given to MBIA under this Ordinance shall be in writing and shall be
sent by registered or certified mail addressed to MBIA Insurance Corporation, 113 King
Street, Armonk, New York 10504 Attention Surveillance.
RHOCK/: ORUIN2.AUT 11/20/97
25
Section 21. 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.
By motion duly made, seconded and passed with an affirmative vote of all the Council
members present, the requirement for reading this ordinance on two separate days was dispensed with
in accordance with Section 3.13 and 9.01(e)(2) of the City's Charter.
RRO(.7C/: OR131N2.AUT 11/20/97
26
READ, PASSED AND ADOPTED on first reading this 25th day of November, 1997.
ATTEST:
Joanne Land, City Secretary
RROCC/: ORDIN2.AUT 11/2097
27
Charles Culpepper, Mayor
City of Round Rock, Texas
RROCK/: ORDIN2.AUT 11/20/97
EXHIBIT A
ESCROW AGREEMENT
28
ESCROW AGREEMENT
A Portion of Certificates of Obligation, Series 1995,
maturities 6/1/2012 through 6/1/2025
Certificates of Obligation, Series 1990,
maturities 8/1/2002 and 8/1/2010
Certificates of Obligation, Series 1988,
maturity 8/1/2004
Certificates of Obligation, Series 1987,
maturities 8/1/2000 and 8/1/2004 through 8/1/2006
THIS ESCROW AGREEMENT, dated as of November 15, 1997 (herein, together with
any amendments or supplements hereto, called the "Agreement") is entered into by and between the
City of Round Rock, Texas (herein called the "Issuer") and Texas Commerce Bank National
Association, as escrow agent (herein, together with any successor in such capacity, called the
"Escrow Agent"). The addresses of the Issuer, the Escrow Agent, bond rating agencies and bond
insurance company are shown on Exhibit "A" attached hereto and made a part hereof.
WITNESSETH:
WHEREAS, the Issuer heretofore has issued and there presently remain outstanding the
obligations described in Exhibit "B" attached hereto (the "Refunded Obligations"); and
WHEREAS, the Refunded Obligations are scheduled to come due in such years, bear interest
at such rates, and be payable at such times and in such amounts as are set forth in Exhibit "C"
attached hereto and made a part hereof; and
WHEREAS, when firm banking arrangements have been made for the payment of all
principal and interest of the Refunded Obligations when due, 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, Article 717k, V.A.T.C.S. 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 of firm banking and
financial arrangements for the discharge and final payment of the Refunded Obligations; and
MOCK: E3C11.OW.AO0.11/6/97
WHEREAS, Article 717k 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
direct obligations of the United States of America, including obligations the principal of and interest
on which are unconditionally guaranteed by the United States of America, and which may be in book
entry form, 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 of principal and interest on the Refunded
Obligations when due; and
WHEREAS, Texas Commerce Bank National Association (as successor to Mtrust Corp.),
Texas is a paying agent for a portion of the Refunded Obligations and shall act as Escrow Agent, and
this Escrow Agreement constitutes an escrow agreement of the kind authorized and permitted by said
Article 717k; and such Bank has signed this agreement acknowledging same; and
WHEREAS, Article 717k makes it the duty of the Escrow Agent to comply with the terms
of this Agreement and timely make available to the place of payment (paying agent) for the Refunded
Obligations the amounts required to provide for the payment of the principal of and 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 City of Round Rock, Texas General
Obligation Refunding Bonds, Series 1997 (the "Refunding Obligations") have been duly authorized
to be issued, sold, and delivered for the purpose of obtaining funds required to provide for the
payment of the principal of and interest on the Refunded Obligations when due; 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, 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 Obliga-
tions as it accrues and becomes payable and the principal of the Refunded Obligations as it becomes
due and payable; 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
KAOCK. ESCAOW.AOR 11/6197
2
WHEREAS, the Escrow Agent is a party to this Agreement to acknowledge its acceptance
of the terms and provisions hereof,
NOW, THEREFORE, in consideration of the 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:
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:
"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, non prepayable United States Treasury
obligations described in Exhibit "D" attached to this Agreement, or cash or other direct noncallable,
non prepayable obligations of the United States of America.
Section 1.02. Other Definitions. The terms "Agreement", "Issuer", "Escrow Agent",
"Refunded Obligations", "Refunding Obligations" 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 herein, and the Escrow
Agent shall, upon the receipt thereof, acknowledge such receipt to the Issuer in writing.
RROCK: F2CROW.AOR II/ /97
ARTICLE III
CREATION AND OPERATION OF ESCROW FUND
3
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 "City of Round Rock, Texas Certificates of
Obligation, Series 1995, City of Round Rock, Texas Certificates of Obligation, Series 1990, City of
Round Rock, Texas Certificates of Obligation, Series 1988 and City of Round Rock, Texas
Certificates of Obligation, Series 1987 Escrow Fund (the "Escrow Fund"). The Escrow Agent hereby
agrees that upon receipt thereof it will deposit to the credit of the Escrow Fund the funds and the
Escrowed Securities described in Exhibit "D" attached hereto. 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 Exhibit "C"
attached hereto.
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 Exhibit "E" attached hereto. If, for
any reason, at any time, the cash balances on deposit or scheduled to be on deposit in the Escrow
Fund shall be insufficient 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
promptly 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
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
RROCK. ESCROW AOR 11/6/97
4
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. Investments. Except for the initial deposit in the Escrowed Securities, and
except as provided in Sections 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 Exhibit 'D" hereto, the Escrow Agent shall reinvest cash
balances shown in Exhibit "F" attached hereto in zero (0) interest rate United States Treasury
Obligations - State and Local Government Series to the extent such obligations are available from the
Department of the Treasury. All such reinvestments 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 reinvestments shall be acquired on and shall mature on the dates on Exhibit "F" attached
hereto.
Section 4.03. Substitution of Securities. At the written request of the Issuer, and upon
compliance with the conditions hereinafter stated, the Escrow Agent shall utilize cash balances in the
Escrow Fund, or sell, transfer, otherwise dispose of or request the redemption of the Escrowed
Securities and apply the proceeds therefrom to purchase Refunded Obligations or direct obligations
of, direct non prepayable obligations of, or obligations the principal of and interest on which is
unconditionally guaranteed by, the United States of America which do not permit the redemption
thereof at the option of the obligor. Any such transaction may be effected by the Escrow Agent only
if (a) the Escrow Agent shall have received a written opinion from a nationally recognized
independent firm of certified public accountants that such transaction will not cause the amount of
money and securities in the Escrow Fund to be reduced below an amount sufficient without further
investment or reinvestment of either the principal amount thereof or the interest earnings thereof to
provide for the full and timely payment of principal of, redemption premium on and interest on all of
the remaining Refunded Obligations as they become due, taking into account any optional redemption
thereof exercised by the Issuer in connection with such transaction; and (b) the Escrow agent shall
RROCK:+UCROW.AOR 1116/97
5
have received the unqualified written legal opinion of nationally recognized bond counsel licensed in
the State of Texas to the effect that such transaction will not cause any of the Refunded Obligations
or the Refunding Obligations to be an "arbitrage bond" within the meaning of Section 103(c) of the
Code or to otherwise affect the tax exempt status of the interest on such bonds.
Section 4.04. 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 of Escrowed 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
obligations would cause any Refunding Obligations or Refunded Obligations to be an "arbitrage
bond" within the meaning of the Internal Revenue Code of 1986 or, if applicable, the Internal
Revenue Code of 1954, as amended.
ARTICLE V
APPLICATION OF CASH BALANCES
Section 5.01. In General. Except as provided in Sections 3.02, 4.02 and 4.03 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
MOCK: FJCROW.AOR 11/6/77
6
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 obligor of the Escrowed Securities to make
timely payment thereon, except for the obligation to notify the Issuer promptly 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 lossjunless the same shall have been through its negligence or want of
good faith.
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 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.
RROCK. ESCROW. AOR 11/6/97
7
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
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 Paying Agent is a place of payment (paying agent) for the Refunded Obligations.
Concurrently with the sale and delivery of the Refunding Obligations the Issuer shall pay to the
Paying Agent the sum of $ , the sufficiency of which is hereby acknowledged by the Paying Agent,
for all future paying agency services of the Paying Agent; and the Paying Agent warrants that such
sum is sufficient for such purpose. Also concurrently with the sale and delivery of the Refunding
Obligations the Issuer shall pay to any other places of payment (paying agents) for the Refunded
Obligations all sums due for all future paying agency services in connection with certain of the
Refunded Obligations.
(c) Upon receipt of the aforesaid specific sums stated in subsections (a) and (b) of this
Section 7.03 for Escrow Agent and paying agency fees, expenses, and services, the Escrow Agent
and other places of payment (paying agents) shall acknowledge such receipt to the Issuer in writing.
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, having its principal office and 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.
RKOCK: ESCROW. AOR 11/6/97
8
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 shall pay over to its successor Escrow Agent a proportional
part of the Escrow Agent's fee hereunder.
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 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 or 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 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 and
Rating Agency 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 10 days prior notice thereof.
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
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, the
Escrow Agent and the Paying 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, the Paying 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
RROCK: 93CRUW.AUR 11/6/97
9
this Agreement shall be construed as if such invalid or illegal or unenforceable provision had never
been contained herein. If any portion of the Agreement is held to be invalid or illegal or
unenforceable, Moody's Investors Service and Standard & Poors Corporation should be notified.
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. 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. Moody's Investors Service, Standard
& Poors Corporation and insurance shall be given copies of proposed amendments prior to execution.
RROCK: E8CROW.AUR 11/6/91
10
EXECUTED as of the date first written above.
ATTEST:
City Secretary
(SEAL)
ATTEST:
Title:
(SEAL)
MOCK: H CROW.AOA 11/f/97
11
CITY OF ROUND ROCK, TEXAS
By
Mayor
TEXAS COMMERCE BANK
NATIONAL ASSOCIATION
By
Vice President
INDEX TO EXHIBITS
Exhibit "A" Addresses of the Issuer and the Escrow Agent
Exhibit "B" Description of the Refunded Obligations
Exhibit "C" Schedule of Debt Service on Refunded Obligations
Exhibit "D" Description of Beginning Cash Deposit (if any) and Escrowed Securities
Exhibit "E" Escrow Fund Cash Flow
Exhibit "F" Reinvestments in Zero Coupon SLGS
MOCK: EISCROW.A011 II/4/97
Issuer
Escrow Agent
Rating Agency
Insurer
MOCK: EICROW.Ac 11/U,7
EXHIBIT "A"
ADDRESSES OF THE ISSUER, ESCROW AGENT,
RATING AGENCY, AND INSURER
City of Round Rock, Texas
211 East Main Street
Round Rock, Texas 78664
Texas Commerce Bank National Association
700 Lavaca
Austin, Texas 78701
Moody's Investors Service
99 Church Street
New York, N. Y. 10007
Attention: Public Finance Rating Desk - Refunded Bonds
Standard & Poor's Ratings Group
25 Broadway
New York, N. Y. 10004
Attention: Public Finance Rating Desk - Refunded Bonds
MBIA Insurance Corporation
113 King Street
Armonk, New York 10504
Attention: Diana M. Allen
A-1
ROCK E CROW.AOR 1 I/6/97
EXHIBIT "B"
DESCRIPTION OF THE
REFUNDED OBLIGATIONS
A Portion of Certificates of Obligation, Series 1995,
maturities 6/1/2011 through 6/1/2025
Certificates of Obligation, Series 1990,
maturities 8/1/2002 and 8/1/2010
Certificates of Obligation, Series 1988,
maturity 8/1/2004
Certificates of Obligation, Series 1987,
maturities 8/1/2000 and 8/1/2004 through 8/1/2006
B-1
RROCK: E CROW.AOR 11/ 6/97
EXHIBIT "C"
SCHEDULE OF DEBT SERVICE
ON REFUNDED OBLIGATIONS
C-1
EXHIBIT "D"
ESCROW DEPOSIT
I. CASH
II. STATE AND LOCAL GOVERNMENT SECURITIES
A. Certificates of Indebtedness
Principal Amount
B. Notes
Principal Amount
.ROCK: e3CROW.AOR 1116197
Interest Rate Maturity Date
Interest Rate Maturity Date
D-1
Dates
MOCK: BDCROW.A®l 111/ 4/97
EXHIBIT "E"
ESCROW FUND CASH FLOW
Remaining Debt
Debt Service
Payment on
Cash Receipts Refunded Cash
from SLGS Obligations Balance
E-1
RROCK: ESCROW.ACIR II/6/97
EXHIBIT "F"
REINVESTMENT IN ZERO SLGS
F-1
RROCKL ORDIN3.AUT 11130197
EXHIBIT B
PURCHASE AGREEMENT
B-1
$5,300,000
City of Round Rock, Texas
(Williamson and Travis Counties)
General Obligation Refunding Bonds
Series 1997
PURCHASE AGREEMENT
November 25, 1997
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 1 hereto (the
Representative and such other underwriters being herein 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. The Representative need not advise the Issuer of any change in such list of
Underwriters, except that the Representative shall in any event remain on such list. This offer is made
subject to the Issuer's written acceptance hereof on or before 10:00 p.m., 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.
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 Refunding Bonds, Series 1997 (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 (as
hereinafter defined).
The purchase price for the Bonds shall be $5,214,749.10 (representing the par amount of the
Bonds of $5,300,000 less an original issue discount on the Bonds of $42,850.90 and less an underwriters
discount on the Bonds of $42,400.00) plus interest accrued on the Bonds from the dated date of the Bonds
to the Closing Date (as hereinafter defined).
F:\RDI366\LEG503\ROUNDRK\BPA5. WPD
Delivered to the Issuer herewith is a corporate check of the Underwriters payable to the order of
the Issuer in the amount of $58,000. The Issuer agrees to hold such check uncashed until the Closing to
ensure the performance by the Underwriters of their obligations to purchase, accept delivery of and pay
for the Bonds at the Closing. Concurrently with the payment by the Underwriters of the aggregate
purchase price of the Bonds, the Issuer shall return such check to the Underwriters 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 Underwriters. 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 and for full liquidated damages
for such failure of the Underwriters and for any defaults hereunder on the part of the Underwriters. The
Underwriters hereby agree 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.
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 November 25, 1997.
(b) The Preliminary Official Statement of the Issuer, dated October 23, 1997, including the
cover page, Schedules 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 Representative, as
indicated on Exhibit A attached hereto, is hereinafter called the "Official Statement."
(c) Prior to or concurrently with the acceptance hereof by the Issuer, the Issuer has delivered
to the Representative:
(1) one certified copy of the Bond Ordinance; and
(ii) two copies of the Official Statement manually signed on behalf of the Issuer by
the Mayor of the Issuer.
(d) The Issuer hereby represents and warrants that the Preliminary Official Statement
previously delivered to the Representative 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").
P: \RD 1366\LEG503\ROU N DRK\BPA5. W PD
-2-
(e) The Issuer has duly authorized, approved and executed the Official Statement, which is
final for purposes of Rule 15c2-12.
(f) 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.
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 make a bona fide public offering of all of 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.
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.
(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
F: \RDI 366\LGG503\ROUNDRK\0PA5. W PD
-3-
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 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 Underwriters 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 Representative as the Representative 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 Representative 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.
(vi) To advise the Representative 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) Prior to Closing not to offer or 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 each of 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
(including the Issuer's Home Rule Charter) and has full legal right, power and authority pursuant
to the Constitution and laws of the State of Texas, including particularly Article 717k, Vernon's
Annotated Texas Civil Statutes, as amended (the "Act"), and at the date of the Closing will have,
full legal right, power and authority to (i) enter into this Purchase Agreement and the Escrow
Agreement described in the Bond Ordinance (the "Escrow Agreement"), (ii) adopt the Bond
Ordinance, (iii) sell, issue and deliver the Bonds to the Underwriters as provided herein, (iv)
P:\RDI366\LEG503\ROUNDRK\BPA5. WI'D
-4-
secure the payment of the Bonds as provided in the Bond Ordinance, and (v) carry out and
consummate the transactions contemplated by this Purchase Agreement, the Bond Ordinance, the
Escrow Agreement and the Official Statement, and the Issuer has complied, and will at the
Closing be in compliance in all respects, with the terms of the Act 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, the Escrow Agreement, this Purchase
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 and this
Purchase Agreement, will be payable from an ad valorem tax levied, within the limits prescribed
by law, against all taxable property 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, the Escrow Agreement
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
P: \RD 1366\LEG503\ROUNDRK\BPA5. W I'D
-5-
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
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"; the Bond Ordinance and the Escrow Agreement conform to
the description thereof contained in the Official Statement; 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 the exclusion from gross income of interest on the Bonds for federal
income tax purposes, 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 or 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, this Purchase Agreement, or the Escrow
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
P:\RD1366\LEG503\ROUNDRK\OPAS. WPD
-6-
therein or necessary to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
(i) [f 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.
(j) 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) any unaudited financial
information has 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.
6. Closing. (a) At 10:00 a.m., Texas time, on December 23, 1997, 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 the Bonds to the Representative duly
executed and authenticated in the form and manner contemplated below, together with the other
documents hereinafter mentioned, and the Representative 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 McCall, Parkhurst
& Horton L.L.P., Austin, Texas, or such other place as shall have been mutually agreed upon by the
Issuer and the Representative.
(b) Delivery of the Bonds shall be made at The Depository Trust Company, New York, New
York. The Bonds shall be delivered in fully registered form bearing CUSIP numbers without coupons
with one Bond for each maturity of Bonds, registered in the name of CEDE & CO. and shall be made
available 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'
P:\RD 1366\LEG503\ROUNDRK\IRPM. W I'D
-7-
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 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 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 and the Escrow Agreement 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 Escrow 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) At or prior to the Closing, either (i) the District shall have purchased or
subscribed for the purchase of the United States Treasury Obligations described in the
Verification Report (hereinafter defined) at prices not exceeding the market prices thereof or (ii)
the Issuer shall have subscribed to the United States Treasury for the purchase of State and Local
Government Series securities required to be deposited with the Escrow Agent named in the
Official Statement (the "Escrow Agent") pursuant to the Bond Ordinance and the Escrow
Agreement.
(f) 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 City Secretary.
(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 Underwriters, and containing therein the
agreement of the Issuer to provide certain periodic information and notices of material
F:\RD I366\LE0503\ROUNDRK\UPAS. W PD
-8-
events in accordance with Rule 15c2-12, as described in the Official Statement under the
caption "CONTINUING DISCLOSURE OF INFORMATION."
(3) The opinion of McCall, Parkhurst & Horton L.L.P., in substantially the
form and substance of Appendix C to the Official Statement.
(4) 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 certificate of the Comptroller of Public Accounts of the State of Texas for the
Bonds.
(5) 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 "THE
BONDS" (other than information under the subcaptions "—Book -Entry -Only System"
and "—Use of Proceeds"), "TAX MATTERS," "CONTINUING DISCLOSURE OF
INFORMATION" (other than information under the subcaption "—compliance with
prior undertakings") and "OTHER INFORMATION—Legal Investments and Eligibility
to Secure Public Funds in Texas" 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.
(6) An opinion, dated the date of the Closing and addressed to the
Underwriters, of Vinson & Elkins L.L.P., Dallas and Austin, Texas ("Underwriters'
Counsel"), in substantially the form of Exhibit B hereto.
(7) A certificate, dated the date of the Closing, signed by the Mayor, the City
Manager and the City Secretary, to the effect that (i) the representations and warranties
of the Issuer contained herein are true and correct in all material respects on and as of the
date of Closing as if made on the date of Closing; (ii) except to the extent disclosed in the
Official Statement, no litigation is 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
P:\RD1366\LEG503\ROUNDRK\BPA3. WPD
-9-
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 Underwriters may, in their 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; and (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 the latest date as
to which audited financial information is available.
(8) A certificate, dated the date of the 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 Internal Revenue Code of 1986, as amended.
(9) A copy of the municipal bond insurance policy issued by MBIA
Insurance Corporation (the "Insurer") insuring the timely payment of the principal of and
interest on the Bonds.
(10) A legal opinion from counsel to the Insurer addressed to the
Underwriters, Underwriters' Counsel and the Issuer in a form acceptable to Bond Counsel
to the Issuer and Underwriters' Counsel.
(11) Rating letters from Moody's Investors Service and Standard & Poors, a
division of the McGraw Hill Companies, indicating a rating for the Bonds which is not
lower than "Aaa" and "AAA", respectively, and which are in a form acceptable to the
Underwriters.
F. \RD 1366\LGG503\ROUNDRK\0PA5. W PD
-10-
(12) A copy of a special report (the "Verification Report") prepared by Grant
Thornton L.L.P., independent certified public accountants, addressed to the Issuer, Bond
Counsel, the Underwriters and Underwriters' Counsel (i) verifying the mathematical
computations of the adequacy of the maturing principal amounts of and interest on the
Escrowed Securities (as defined in the Escrow Agreement) and uninvested cash held
under the Escrow Agreement to pay, when due, the principal or redemption price of and
interest on the bonds being refunded and (ii) verifying the mathematical computations
supporting the conclusion of Bond Counsel that the Bonds are not "arbitrage bonds"
under the Code;
(13) 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 Representative.
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 Underwriters 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 Representative 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 under
consideration by either such committee or is introduced as an option for consideration by either
F:\RD1366\LEG5O3\ROUNDRK\BPA5. WPD
-11-
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 house, or (ii) a
decision shall have been rendered by a court established under Article [II 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 Representative 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, or 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.
(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 Representative 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, requires or has required an amendment of or supplement to the Official Statement.
(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 Representative, 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
P:\RD 1366\LEG503\ROUN DRK\61'A5. W 1'D
-12-
with 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 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.
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.; (iv) the fees and disbursements of the financial advisor to the
Issuer, if any; (v) the fees and disbursements of any other engineers, accountants, and other experts,
consultants or advisers retained by the Issuer, including the fee of Grant Thornton L.L.P. for the
preparation of the Verification Report; (vi) the premium and all other costs associated with acquiring
municipal bond insurance for the Bonds; and (vii) 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, 221 East Main Street,
Round Rock, Texas 78664, Attention: Director of Finance, and any notice or other communication to
be given to the Underwriters under this Purchase Agreement may be given by delivering the same in
F:\RD1366\LEG503\ROUNDRK\BPAS. WPD
-13-
writing to Legg Mason Wood Walker, Inc., 1111 Bagby Street, Suite 1400, Houston, Texas 77002,
Attention: Bob Schnakenberg.
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 any Underwriter) 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 any 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. CHOICE OF LAW. THIS PURCHASE AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF TEXAS.
14. 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.
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. Paragraph 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.
P:\RD 1366\LC0503\ ROU NDRK\UPA5. W PD
-14-
Accepted and agreed to this
day of November, 1997.
CITY OF ROUND ROCK, TEXAS
By:
Title: Mayor
F: \RD 1366\LEG503\ROUNDRK\BPA5. W PD
-15-
Very truly yours,
LEGG MASON WOOD WALKER, INC.
as Representative for the Underwriters
identified on Schedule 1
By
Authorized Officer
F:\RD 1766\LEG503\ROUNDRK\BPA5. W PD
LIST OF UNDERWRITERS
LEGG MASON WOOD WALKER, INC.
SOUTHWEST SECURITIES, INC.
-16-
SCHEDULE1
Exhibit A
[Attach form of Official Statement completed as provided in
Section 1 hereof]
Legg Mason Wood Walker, Inc.
Southwest Securities, Inc.
c/o Legg Mason Wood Walker, Inc.
221 West Sixth Street, Suite 950
Austin, Texas 78701
, 1997
Exhibit B
Re: City of Round Rock, Texas, General Obligation Refunding Bonds, Series 1997
Ladies and Gentlemen:
We have acted as counsel to you as Underwriters of $5,300,000 aggregate principal amount of
the captioned Bonds (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 November 25, 1997 (the "Ordinance"). The
Underwriters are purchasing the Bonds pursuant to the Purchase Agreement (the "Purchase Agreement")
with respect thereto, dated November 25, 1997. 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 Ordinance, the Purchase Agreement
and the Official Statement and the certificates and opinions referred to in Paragraph 7(e) 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.
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, 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
, 1997
Page 2
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,
PADDY : ORDIN2.AUT 11/20/97
EXHIBIT C
PAYING AGENT/REGISTRAR AGREEMENT
C-1
PAYING AGENT/REGISTRAR AGREEMENT
THIS AGREEMENT dated as of November 20, 1997 ("Agreement"), by and between the
City of Round Rock, Texas (the "Issuer"), and Texas Commerce Bank National Association, a
banking association duly organized and existing under the laws of the State of Texas ("Bank").
RECITALS
WHEREAS, the Issuer has duly authorized and provided for the issuance of certificates of
obligation to be issued only in registered form, as to payment of principal and interest thereon in an
aggregate principal amount of $5,300,000 and titled General Obligation Refunding Bonds, Series
1997 (the "Bonds"); and
WHEREAS, the Bonds are scheduled to be delivered to the initial purchasers thereof on or
about December 23, 1997; 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 of the 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 "Ordinance."
The Bank hereby accepts its appointment, and agrees to serve as the Paying Agent and
Registrar for the Bonds.
RAOCK: PAYAO.AOR II/ /97
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 Ordinance" means a written request or ordinance signed
in the name of the Issuer by the Mayor of the Issuer, any one or more of said officials,
delivered to the Bank.
"Legal Holiday" means a day on which the Bank is required or authorized to be
closed.
"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).
ROCK PAYAQA011 11//7
2
"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.
"Ordinance" means the ordinance of the governing body of the City pursuant to which
the Bonds are issued, certified by the Secretary of the Board of Emergency Services
Commissioners or any other officer of the City and delivered to the Bank.
"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 "Certificates" and "Bond" 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.
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
MOCK: PAYAO.AOR I1/6N97
3
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 Ordinance.
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.
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 cancelled 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.
MOCK. PAYAO.AG 11 /617
4
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 ordinance or as otherwise required by law. Upon receipt of a court ordinance 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 ordinance or such release or disclosure of the contents of the
Bond Register.
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 Ordinance,
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.
MOCK: PAYAO.AOR ll/6/97
5
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.
(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 of this 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,
ordinance, 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, ordinance,
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.
RAOCA: PAYAO.AOA 11/6/f7
6
(f) The Bank may exercise any of the 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 of Bonds
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.
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 fiduciary 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.
RROCK: PAYA(I.A .11/411
7
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 and County where either the Bank Office or the administrative offices of
the Issuer is located, and agree that service of process 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 to determine the rights of any Person claiming any interest
herein.
Section 5.08. Depository 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
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 of the Letter of Representations with The Depository Trust
Company.
hereto.
other.
ARTICLE SIX
MISCELLANEOUS PROVISIONS
Section 6.01. Amendment.
This Agreement may be amended only by an agreement in writing signed by both of the parties
Section 6.02. Assignment.
This Agreement may not be assigned by either party without the prior written consent of the
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.
MOCK: PAYA(I.AW. 11/4/97
8
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.
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 Ordinance 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 Ordinance, the Ordinance 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.
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.
RROCK: PAYAO.AOR 11/6N7
9
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.
Section 6.11. Governing Law.
This Agreement shall be construed in accordance with and governed by the laws of the State
of Texas.
MOCK: PAYAO.AOR 11/6/97
10
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year first above written.
Attest:
Title
[BANK SEAL]
[ISSUER SEAL]
Attest:
City Secretary
RROCR: PAYAO.AOR 11/f/f7
11
TEXAS COMMERCE BANK
NATIONAL ASSOCIATION
By:
Title:
700 Lavaca, 5th Floor
Austin, Texas 78701
CITY OF ROUND ROCK, TEXAS
By:
Mayor
211 East Main Street
Round Rock, Texas 78664
PROM: PAYAQAal&uam
SCHEDULE A
Paying Agent/Registrar Fee Schedule
Acceptance Fee $
Annual Administration Fee $
A-1
Exhibit D
NOTICE OF DEPOSIT AND PRIOR REDEMPTION
CITY OF ROUND ROCK, TEXAS
CERTIFICATES OF OBLIGATION,
SERIES 1995
NOTICE IS HEREBY GIVEN that the City of Round Rock, Texas ("City") has deposited money
and direct obligations of the United States of America in an amount sufficient to defease until the first
available redemption date the following obligations of the City (the "Certificates"):
City of Round Rock, Texas Certificates of Obligation, Series 1995, a portion of the
amounts maturing on June 1 in the years 2012 through 2025 in the aggregate
principal amount of $3,795,000; redemption date: June 1, 2005 redeemable at par
plus accrued interest at the designated office for payment of The Bank of New York,
New York, at the addresses set forth below, only upon presentation and surrender
thereof. The described Certificates shall become due and payable on the redemption
date specified, and the interest thereon shall cease to accrue from and after the
redemption date of June 1, 2005.
BY MAIL: HAND DELIVERY:
The Bank of New York
P. O. Box 3856
Houston, Texas 77253-3856
Attn: BNY Information Services
The Bank of New York
1301 Fannin, Suite 2215
Houston, Texas 77002
Attn: BNY Information Services
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 20% (31%
for taxable years beginning in and after 1993) 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 Certificates for redemption.
NAOCK/: ORDIN2.AI1T 11/20/97
D-1
CITY OF ROUND ROCK, TEXAS
NOTICE OF DEPOSIT AND PRIOR REDEMPTION
CITY OF ROUND ROCK, TEXAS
CERTIFICATES OF OBLIGATION,
SERIES 1990
NOTICE IS HEREBY GIVEN that the City of Round Rock, Texas ("City") has deposited money
and direct obligations of the United States of America in an amount sufficient to defease until the first
available redemption date the following obligations of the City (the "Certificates"):
City of Round Rock, Texas Certificates of Obligation, Series 1990, maturing on
August 1 in the years 2002 and 2010 in the aggregate principal amount of $225,000;
redemption date: August 1, 2000; redeemable at par plus accrued interest at the
designated office for payment of Texas Commerce Bank National Association, at the
addresses set forth below, only upon presentation and surrender thereof. The
described Certificates shall become due and payable on the redemption date specified,
and the interest thereon shall cease to accrue from and after the redemption date of
August 1, 2000.
BY MAIL: HAND DELIVERY:
Texas Commerce Bank National
Association
P. O. Box 2320
Dallas, Texas 75221-2320
Attn: Registered Bond Processing
Texas Commerce Bank National
Association
1201 Main Street, 18th Floor
Dallas, Texas 75202
Attn: Registered Bond Processing
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 20% (31%
for taxable years beginning in and after 1993) 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 Certificates for redemption.
KNOCK/: ORDINI.AOT 11/20/97
D-2
CITY OF ROUND ROCK, TEXAS
NOTICE OF DEPOSIT AND PRIOR REDEMPTION
CITY OF ROUND ROCK, TEXAS
CERTIFICATES OF OBLIGATION,
SERIES 1988
NOTICE IS HEREBY GIVEN that the City of Round Rock, Texas ("City") has deposited money
and direct obligations of the United States of America in an amount sufficient to defease until the first
available redemption date the following obligations of the City (the "Certificates"):
City of Round Rock, Texas Certificates of Obligation, Series 1988, maturing on
August 1, 2004 in the aggregate principal amount of $225,000; redemption date:
August 1, 1998; redeemable at par plus accrued interest at the designated office for
payment of Texas Commerce Bank National Association, at the addresses set forth
below, only upon presentation and surrender thereof. The described Certificates shall
become due and payable on the redemption date specified, and the interest thereon
shall cease to accrue from and after the redemption date of August 1, 1998.
BY MAIL:
Texas Commerce Bank National
Association
P. O. Box 2320
Dallas, Texas 75221-2320
Attn: Registered Bond Processing
HAND DELIVERY:
Texas Commerce Bank National
Association
1201 Main Street, 18th Floor
Dallas, Texas 75202
Attn: Registered Bond Processing
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 20% (31%
for taxable years beginning in and after 1993) 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 Certificates for redemption.
RROCK/: ORRDIN2.AUT 11/20/97
D-3
CITY OF ROUND ROCK, TEXAS
NOTICE OF DEPOSIT AND PRIOR REDEMPTION
CITY OF ROUND ROCK, TEXAS
CERTIFICATES OF OBLIGATION,
SERIES 1987
NOTICE IS HEREBY GIVEN that the City of Round Rock, Texas ("City") has deposited money
and direct obligations of the United States of America in an amount sufficient to defease until the first
available redemption date the following obligations of the City (the "Certificates"):
City of Round Rock, Texas Certificates of Obligation, Series 1987, maturing on
August 1 in the years 2000 and 2004 through 2006 in the aggregate principal amount
of $630,000; redemption date: February 1, 1998; redeemable at par plus accrued
interest at the designated office for payment of The Bank of New York, New York,
at the addresses set forth below, only upon presentation and surrender thereof. The
described Certificates shall become due and payable on the redemption date specified,
and the interest thereon shall cease to accrue from and after the redemption date of
February 1, 1998.
BY MAIL: HAND DELIVERY:
The Bank of New York
P. O. Box 3856
Houston, Texas 77253-3856
Attn: BNY Information Services
The Bank of New York
1301 Fannin, Suite 2215
Houston, Texas 77002
Attn: BNY Information Services
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 20% (31%
for taxable years beginning in and after 1993) 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 Certificates for redemption.
RROCK/: O11DIN2.AUT 11/30/97
D-4
CITY OF ROUND ROCK, TEXAS
EXHIBIT E
DESCRIPTION OF ANNUAL FINANCIAL INFORMATION
The following information is referred to in Section 19 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) Table 1 Valuation, Exceptions and General Obligation Debt;
(2) Table 2 Taxable Assessed Valuations by Category;
(3) Table 3 Valuation and General Obligation Debt History;
(4) Table 4 Tax Rate, Levy and Collection History;
(5) Table 5 Ten Largest Taxpayers;
(6) Table 8 Pro -Forma General Obligation Debt Service Requirements;
(7) Table 12 General Fund Revenues and Expenditure History;
(8) Table 13 Municipal Sales Tax History; and
(9) Information under the subheading "Financial Information - 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 paragraph 1 above.
RROCK/: ORDINT.AUT 11/20197
E-1
DATE: November 20, 1977
SUBJECT: City Council Meeting, November 25, 1997
ITEM: 9. D. Consider an ordinance authorizing the Issuance of City of Round Rock,
Texas General Obligation Refunding Bonds, Series 1997; Levying an
Ad Valorem Tax in Support of the Bonds; Approving an Official
Statement; Authorizing the Execution of a Purchase Agreement, a
Paying Agent/Registrar Agreement and a Letter of Representations,
and an Escrow Agreement; Making Certain Continuing Disclosure
Covenants Under Rule 15c2-12; Calling Certain Obligations for
Redemption and Ordaining Other Matters Relating to the Issuance of
the Bonds. (First Reading) (Tabled 11/13/97)
STAFF RESOURCE PERSON: David Kautz
The general proposal is to issue $5,300,000 (preliminary, subject to change) in refunding
general obligation bonds and achieve approximately 3% present value savings, all costs
included. This would represent a cumulative debt service savings of $151,000 over
the life of the issue.
A firm bid has been received which will enable the City to realize the above savings. A
presentation on the final figures will be made by staff and the City's financial advisor.