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HomeMy WebLinkAboutOrdinance 10969~_ -- 4r'`f 11/27 91 ORDINANCE N0. ~~q FIRST SUPPLEMENTAL ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF CITY OF FORT WORTH, TEXAS WATER AND SEWER SYSTEM REVENUE REFUNDING BONDS, SERIES 1991A _AND CITY_OF.F_ORT WORTH, TEXAS WATER AND SEWER SYSTEM REVENUE REFUNDING BO D , ~~~,~~ SERIES 1991E THE STATE OF TEXAS COUNTIES OF TARRANT AIJD DENTON CITY OF FORT WORTH WHEREAS, the City of Fort Worth, Texas (the "City" or the "Issuer"), a "home-rule" city operating under a home-rule charter adopted pursuant to Section 5 of Article XI of the Texas Constitution, with a population according to the latest federal `~ decennial census of in excess of 90,000, has established and currently owns and operates a combined waterworks and sanitary sewer system (the "System"); and WHEREAS, the City has outstanding the following obligations secured by the pledge of a first lien on and pledge of the net revenues of the System, to-wit: City of Fort Worth, Texas Water and Sewer System Revenue Refunding Bonds, Series 1984, now outstanding in the aggregate principal amount of x$31,174,000; City of Fort Worth, Texas Water and Sewer System Revenue Bonds, Series 1984A, now outstanding in the aggregate principal amount of,$4~0, 00,0; City of Fort Worth, Texas Water and Sewer System Revenue Bonds, Series 1985, now outstanding in the aggregate principal amount of~57,200.000; City of Fort Worth, Texas Water and Sewer System Revenue Bonds, Series 1986, now outstanding in the aggregate principal amount of A$15, 100, 000; ^~. City of Fort Worth, Texas Water and Sewer System Revenue Refunding Bonds, Series 1986-A, now outstanding in the aggregate principal amount of w$60,360,000; City of Fort Worth, Texas Water and Sewer System Revenue Bonds, Series 1987, now outstanding in the aggregate principal amount of x$15, 2.00,,000; City of Fort Worth, Texas Water and Sewer System Revenue Bonds, Series 1988, now outstanding in the aggregate principal amount of $1~7: 4 =0, 000; .+.-... (the "Previously Issued Parity Bonds"); and WHEREAS, in the ordinances authorizing the issuance of the Previously Issued Parity Bonds (together., the "Prior Lien Bond Ordinance"}, the Previously Issued Parity Bonds were secured by a first lien on and pledge of the "Pledged Revenues" (as defined in the Prior Lien Bond Ordinance); and WHEREAS, the City reserved the right in the Prior Lien Bond Ordinance to issue obligations payable from a subordinate lien on the Pledged Revenues to that granted to the Previously Issued Parity Bonds; and WHEREAS, on March 8, 1990, the City adopted an ordinance authorizing the establishment of a commercial paper program and the issuance of commercial paper notes in a principal amount at any time outstanding not to exceed $75,000,000 (the "Series A Notes"); and WHEREAS, the Series A Notes are secured in part by a line of credit with The Mitsui Taiyo Kobe Bank, Limited (the "Bank"); and WHEREAS, the City has pledged to the Bank as security for said line of credit a lien on and pledge of the Pledged Revenues -2- ~, ~ t subordinate to that securing the Previously Issued Parity Bonds; and WHEREAS, concurrently herewith, the City Council has adopted a "Master Ordinance Establishing The City of Fort Worth, Texas System Revenue Financing Program" (referred to herein as the "Master Ordinance"); and WHEREAS, unless otherwise defined herein, terms used herein shall. have the meaning given in the Master Ordinance; and WHEREAS, the Master Ordinance establishes said Revenue Financing System, and pledges the Pledged Revenues of the System to the payment of Parity Obligations to be outstanding thereunder; and WHEREAS, the City Council finds it necessary and advisable to refund the Previously Issued Parity Bonds and the outstanding Series A Notes (collectively defined in Exhibit A hereto as the "Refunded Obligations"); and WHEREAS, Article ?17k, Texas Revised Civil Statutes, as amended, authorizes the City to enter into an escrow agreement with any paying agent for the Previously Issued Parity Bonds or the Series A Notes with respect to the safekeeping, investment, reinvestment, administration and disposition of any such deposit, upon such terms and conditions as the City and such paying agent may agree, provided that such deposits may be invested and reinvested only in direct obligations of the United States of America, including obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, and which shall mature and bear interest payable at such -3- ~ ;~ ~ ~~: J' i times and in such amounts as will be sufficient to provide for the scheduled payment or prepayment of the Previously Issued Parity Bonds and the Series A Notes; and WHEREAS,~Manufacturers Hanover Trust Company, is the paying agent forAsaid Series 1984_, Series 1984A, Series 1985, Series 1986 ~~...-.. and Series 1986-A Bonds, andAAmeritrust Texas National Association (the successor to MTrust National Association) is the paying agent for. said Series 1987 and Series 1988 Bonds; and WHEREAS, in accordance with the aforesaid Article 717k, the City has concurrently herewith authorized an "Escrow Agreement" withAAmeritrust Texas National Association wherein a portion of the .. proceeds from the bonds hereinafter authorized, together with other available funds, are held for the purpose of the payment of principal of and interest on the Previously Issued Parity Bonds and the Series A Notes; and WHEREAS, the Previously Issued Parity Bonds and the Series A Notes each mature or are subject to redemption prior to maturity within twenty years of the date of the bonds hereinafter authorized; and WHEREAS, the City Council has adopted this First Supplement to the Master Ordinance in accordance with the provisions of the Master Ordinance and the bonds hereinafter authorized shall hereafter constitute Parity Obligations under the Master Ordinance; and WHEREAS, the bonds hereinafter authorized are to be issued and delivered pursuant to the laws of the State of Texas, including -4- ~, .r specifically Article 717k and Article 717q, Texas Revised Civil Statutes,. as amended, for the purpose of refunding the Previously Issued Parity Bonds and the Series A Notes. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS: SECTION 1. DEFINITIONS. In addition to the definitions set forth in the preamble of this First Supplement, the terms used in this First Supplement (except in the FORM OF BOND set forth in Exhibit B to this First Supplement) and not otherwise defined shall have the meanings given in the Master Ordinance or in Exhibit A to this First Supplement attached hereto and made a part hereof. Section 2. BONDS AUTHORIZED. That then"City of Fort Worth, Texas Water and Sewer System Revenue Refunding Bonds, Series 1991A" are hereby authorized to be issued in the aggregate principal amount of A$50~5_ 75., 000 and the "City of Fort Worth,. Texas Water an_d Sewer System Revenue Refunding Bonds, Series 1991B" are hereby ----- - - authorized to be issued in the aggregate principal amount of $151,475,000, for the purpose of refunding the Refunded Obligations. The Bonds shall be issued, shall be payable, are subject to redemption prior to their scheduled maturities, shall have the characteristics, and shall be signed and executed (and the Bonds shall be sealed), all as provided, and in the manner indicated, in the FORM OF BONDS set forth in Exhibit B to this First Supplement. Section 3. DATE AND MATURITIES. That the Bonds shall be datedADecember 1, 1991, shall be in the denomination of $5,000, or -5- a~ , any integral multiple thereof, shall be n~imbered consecutively from one upward, and shall mature on~February 15 in each of the years, and in the amounts, respectively, unless redeemed prior to maturity as required or permitted in the FORM OF BONDS set forth in Exhibit B of this First Supplement, as set forth in the following schedule: SERIES 1991A BONDS Y A S AMOUNTS YEARS AMOUNTS 1993 1994 1995 1996 1997 1998 1999 2000 2001 SERIES 1991B BONDS YEARS 1993 1994 1995 1996 1997 1998 1999 2000 $ 2002 2003 2004 2005 2006 2007 **** 2012 AMOUNTS YEARS 2001 2002 2003 2004 2005 2006 2007 AMOUNTS The Series 1991A Bonds maturing ~F b`rurar~, 15. 2012 are hereby designated as Term Bonds for purposes of this First Supplement. Section 4. RIGHT OF PRIOR REDEMPTION. (a) That the Bonds are subject to optional and mandatory redemption prior to their scheduled maturities in the manner provided in the FORM OF BONDS set forth in Exhibit B to this First Supplement. (b) Notice of any redemption of Bonds shall be given in the following manner, to-wit, (i) a written notice of such redemption -6- r „~: shall be given to the owner of each Bond or a portion thereof being called for redemption not more than 60 days nor less than 30 days prior to the date fixed for such redemption by depositing such notice in the United States Mail, first-class postage prepaid, ad- dressed to each such owner at the address thereof shown on the Registration Books of the Paying Agent/Registrar and (ii) a notice of such redemption shall be published one time, at least 30 days prior to the date fixed for such redemption, in a journal or publication of general circulation in the United States of America which carries as a regular feature notices of redemption of municipal bonds; provided, however, that the failure to send, mail, or receive such notice described in clause (i) above, 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 Bond, as publication of notice as described in clause (ii) above shall be the only notice actually required in connection with or as a prerequisite to the redemption of any Bonds. By the date fixed for any such redemption due provision shall be made by the City with the Paying Agent/Registrar for the payment of the required redemption price for the Bonds or the portions thereof which are to be so redeemed, plus accrued interest thereon to the date fixed for redemption. If such notice of redemption is given, and if due provision for such payment is made, all as provided above, the Bonds, or the portions thereof which are to be so redeemed, thereby automatically shall be redeemed prior to their scheduled maturities, and shall not bear interest after the date -7- fixed for their redemption, and shall not be regarded as being Outstanding except for the right of the owner to receive the redemption price plus accrued interest to the date fixed for redemption. from the Paying. Agent/Registrar out of the funds provided for such payment. The Paying Agent/Registrar shall record in the Registration Books all such redemptions of principal of the Bonds or any portion thereof. If a portion of any Bond shall be redeemed, a substitute Bond or Bonds having the same maturity date, bearing interest at the. same rate, in any denomination or denomina- tions in any integral multiple of $5,000 at the written request of the owner, and in an aggregate principal amount equal to the unredeemed portion thereof, will be issued to the owner upon the surrender thereof for cancellation, at the expense of the City, all as provided in this First Supplement. The maturities of Bonds to be called for redemption shall be determined by the City. The Bonds or portions to be redeemed within each such maturity shall be selected by lot or other customary random method selected by the Paying Agent/Registrar (provided that a portion of a Bond may be redeemed only in an integral multiple of $5,000). The City shall give written notice to the Paying Agent/Registrar of any such redemption of Bonds at least 60 calendar days (or such shorter period as is acceptable to the Paying Agent/Registrar) prior to such redemption. Section 5. INTEREST. (a) That the Series 1991A Bonds sched- ... uled to mature during the years, respectively, set forth below shall bear interest at the following rates per annum: -8- maturities 1993 ----------- $ maturities 1994 ----------- $ maturities 1995 ----------- $ maturities 1996 ----------- $ maturities 1997 ----------- $ maturities 1998 ----------- $ maturities 1999 ----------- $ maturities 2000 ----------- $ maturities 2001 ----------- $ maturities 2002 ----------- $ maturities 2003 ----------- $ maturities 2004 ----------- $ maturities 2005 ----------- $ maturities 20.06 ----------- $ maturities 2007 ----------- $ *********** maturities 2012 ----------- $ (b) That the Series 19918 Bonds scheduled to mature during the years, respectively, set forth below shall bear interest at the following rates per annum: maturities 1993 --------- -- $ maturities 1994 --------- -- $ maturities 1995 --------- -- $ maturities 1996 --------- -- $ maturities 1997 --------- -- $ maturities 1998 --------- -- $ maturities 1999 --------- -- $ maturities 2000 --------- -- $ maturities 2001 --------- -- $ maturities 2002 --------- -- $ maturities 2003 --------- -- $ maturities 2004 --------- -- $ maturities 2005 --------- -- $ maturities 2006 --------- -- $ maturities 2007 --------- -- $ (c) Said interest shall be payable to the owner of any such -- Series 1991A Bond or Series 1991E Bond, as the case may be, in the manner provided and on the dates stated in the FORM OF BONDS ... set forth in Exhibit B to this First Supplement. Section 6. CHARACTERISTICS OF THE BONDS. Registration. Transfer.. Conversion and Exchange; Authentication. (a) The City -9- shall keep or cause to be kept at the principal corporate trust office ofAAmeritrust Texas National Association, in Fort Worth, 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 the Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such registrations, transfers, conversions and exchanges as herein provided. The City Manager or the designee thereof is hereby authorized to execute a "Paying Agent/Registrar Agreement" in such form as is approved by the City Attorney. The Paying Agent/Registrar shall obtain and record in the Registration Books the address of the 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 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./~Except as otherwise provided in the FORM of BONDS set forth in Exhibit B to this First Supplement, the owner of -10- each Bond requesting a conversion,, transfer, exchange and delivery ~_ - of such Bond 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 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 in the FORM OF BONDS set forth in Exhibit B to this .. First Supplement. Each substitute Bond shall bear a letter and/or number to distinguish it from each other Bond. An authorized representative of the Paying Agent/Registrar shall, before the delivery of any such Bond, date and manually sign the "Paying Agent/Registrar's Authentication Certificate" in the form set forth in the FORM OF BONDS set forth in Exhibit B to this First i~ Supplement, and, except as provided below, no such Bond shall be deemed to be issued or Outstanding unless such Certificate is so executed; the foregoing notwithstanding, such Certificate need not be executed if any such Bond is accompanied by an executed "Comptroller's Registration Certificate" in the form set forth in the FORM OF BONDS set forth in Exhibit B to this First Supplement. 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 -11- i the manner prescribed herein, and said 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 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 said Certificate, 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 First Supplement, 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, premium, if any, and interest on the Bonds, all as provided in this First Supplement. 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. (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 redeemed prior to their scheduled maturities, (iii) may be transferred and assigned, (iv) may be converted and exchanged for other Bonds, (v) shall have the characteristics, (vi) shall be signed, sealed, executed and authenticated, (vii) the principal of and interest on the Bonds -12- shall be payable, and (viii) 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 BONDS set forth in Exhibit B to this First Supplement. The Bonds initially issued and delivered pursuant to this First Supplement 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 First Supplement the Paying Agent/Registrar shall execute the "Paying Agent/Registrar's Authentication Certificate", in the form set forth in said FORM OF BONDS. .. (d) Substitute Paying Agent Registrar. The City covenants with the owners of the Bonds that at all times while the Bonds are Outstanding a competent and legally qualified entity shall act as and perform the services of Paying Agent/Registrar for the Bonds under this First Supplement, and that the Paying Agent/Registrar will be one entity. Such entity may be the City, to the extent permitted by law, or a bank, trust company, financial institution, or other agency, as selected by the City. The City reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less. than 120 days written notice to the Paying Agent/Registrar, to be effective not later than 60 days prior to the next principal or interest payment date after such notice. In the event that the entity at any time acting as Paying Agent/Reg- istrar (or its successor by merger, acquisition, or other method) -13- should resign or otherwise cease to act as such, the City covenants that promptly it will appoint a competent and legally qualified entity to act as Paying Agent/Registrar under this First Supplement. 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 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 First Supplement, and a certified copy of this First Supplement shall be delivered to each Paying Agent/Registrar. (e) Notice of Redemption. (i) In addition to the manner of providing notice of redemption of Bonds as set forth in this First Supplement, the Paying Agent/Registrar shall give notice of redemption of Bonds by United States Mail, first-class postage prepaid, at least thirty (30) days prior to a redemption date to each registered securities depository and to any national information service that disseminates redemption notices. In addition, in the event of a redemption caused by an advance refunding of the Bonds, the Paying Agent/Registrar shall send a -14- second notice of redemption to the persons specified in the immediately preceding sentence at least thirty (30) days but not more than ninety (90) days prior to the actual redemption date. Any notice sent to the registered securities depositories or such national information services shall be sent so that they are received at least two (2) days prior to the general mailing or publication date of such notice. The Paying Agent/Registrar shall also send a notice of prepayment or redemption to the owner of any Bond who has not sent the Bonds in for redemption sixty (60) days after the redemption date. (ii) Each redemption notice, whether required in the FORM OF BOND: or otherwise by this First Supplement, shall contain a description of the Bonds to be redeemed including the complete name of the Bonds, the series, the date of issue, the interest rate, the maturity date, the CUSIP number, if any, the certificate numbers, the amounts called of each certificate, the publication and mailing date for the notice, the date of redemption, the redemption price, the name of the Paying Agent/Registrar and the address at which the Bond may be redeemed including a contact person and telephone number. (iii) All redemption payments made by the Paying Agent/Registrar to the registered owners of the Bonds shall include a CUSIP number relating to each amount paid to such registered owner. Section 7. FORM OF BONDS. (a) That the form of all Bonds, including the farm of the Paying Agent/Registrar's Certificate, the -15- fora of Assignment, and the form of the Comptroller's Registration Certificate to be attached only to the Bonds initially issued and delivered pursuant to this First Supplement, shall be, res- pectively, substantially as set forth in Exhibit B, with such appropriate variations, omissions, or insertions as are permitted or required by this First Supplement and any Bond Purchase Agreement. (b) The printer of the Bonds is hereby authorized to print on the Bonds the form of bond counsel's opinion relating to the Bonds, and is hereby authorized to print on the Bonds an appropriate statement of insurance furnished by a municipal bond insurance company providing municipal bond insurance, if any, covering all or any part of the Bonds. Section 8. ESTABLISHMENT OF FINANCING PROGRAM AND ISSUANCE OF PARITY OBLIGATIONS. That. by adoption of the Master Ordinance the City has established the City of Fort Worth., Texas Water and Sewer System Revenue Financing Program for the purpose of providing a financing structure for revenue supported indebtedness of the System. The Master Ordinance is intended to establish a master plan under which revenue supported debt of the System can be incurred. This First Supplement provides for the authorization, issuance, sale, delivery, for:, characteristics, provisions of payment and redemption, and security of the Bonds which are a series of Parity Obligations. The Master Ordinance is incorporated herein by reference and as such made a part hereof for all purposes, except to the extent modified and supplemented hereby, -16- ~:.. and the Bonds are hereby declared to be Parity Obligations under the Master Ordinance. As required by Section 8(a) of the Master Ordinance, the City hereby determines that it will have sufficient funds to meet the financial obligations of the System, including sufficient Pledged Revenues to satisfy the Annual Debt Service Requirements of the System and to meet all financial obligations of the City relating to the System. Section 9. PLEDGE. That the Bonds are and shall be secured by and payable from a first lien on and pledge of the Pledged Reve- nues; and the Pledged Revenues are further pledged to the establishment and maintenance of the Debt Service Fund, and to the Reserve Fund to the extent hereinafter provided. The Bonds are and will be secured by and payable only from the Pledged Revenues, and are not secured by or payable from a mortgage or deed of trust on any properties, whether real, personal, or mixed, constituting the System. Section 10. DEBT SERVICE FUND ACCOUNTS. That within the Debt Service Fund there is hereby established the Mandatory Redemption Account. Amortization Installments shall be deposited to the credit of the Mandatory Redemption Account and be used to retire the principal amount of those Series 1991A Bonds which are designated as Term Bonds under this First Supplement. Section 11. RESERVE FUND. That deposits to the credit of the Reserve Fund shall be made in the manner described in Section 13 (b) of this First Supplement. -17- Section 12. INVESTMENTS. That money in the Reserve Fund created under this First Supplement shall not be invested in securities with an average aggregate weighted maturity of greater than seven years. The value of the Reserve Fund, in addition to the annual determination described in the Master Ordinance, shall be established at the time or times withdrawals are made therefrom. Investments shall be sold promptly when necessary to prevent any default in connection with the Bonds. Earnings derived from the investment of moneys on deposit in the various Funds and Accounts shall be credited to the Fund or Account from which moneys used to acquire such investment shall have come. Section 13. FLOW OF FUNDS. That all monies in the System Fund not required for paying Operating Expenses during each month shall be applied by the City, on or before the t~Ot~h day of the following month, commencing during. the months and in the order of priority with respect to the Funds and Accounts that such applications are hereinafter set forth in this Section. (a) .Debt Service Fund - To the credit of the Debt Service Fund, in the following order of priority, to-wit: (1) such amounts, deposited in approximately equal monthly installments, commencing during the month in which the Bonds are delivered, or the month thereafter if delivery is made after the 1~ day thereof, as will be sufficient, together with other amounts, if any, in the Debt Service Fund available for such purpo ~, to pay the interest scheduled to -18- come due on the Bonds on the next succeeding interest payment date; {2) such amounts, deposited in approximately equal monthly installments, commencing during the month which shall be the later to occur of, (i) the twelfth month before the first maturity date of the Bonds, or (ii) the month in which the Bonds are delivered, or the month thereafter if delivery is made after the~l0t~h day thereof, as will be sufficient, together with other amounts, if any, in the Debt Service Fund available for such purpose, to pay the principal scheduled to mature on the Bonds on the next succeeding principal payment date; and (3) with respect to those Series 1991A Bonds which are Term Bonds, there shall be deposited in monthly installments on or before the ~h day of each month as Amortization Installments to the credit of the Mandatory Redemption Account commencing inA March, 2008 and continuing through/February, 2012, 1/12 of the respective annual amounts as follows: Twelve Month Period Ending Amortization Installment February 10, 2008 February 10, 2009 February 10, 2010 February 10, 2011 February 10, 2012* *Payable at maturity The City shall redeem such Term Bonds on~F'ebruary 15 in each of the years 2~OOr8 to2012, inclusive. The principal amount of such Term Bonds required to be redeemed pursuant to the operation of such -19- mandatory redemption provisions shall be reduced, at the option of the City, by the principal amount of any such Term Bonds which, at least 50 days prior to the mandatory redemption date, (1) shall have been acquired by the City at a price not exceeding the principal amount of such Term 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 moneys in the Mandatory Redemption Account, at a price not exceeding the principal amount of such Term .Bonds plus accrued interest to the date of purchase thereof, or (3) have been redeemed pursuant to the optional redemption provisions set forth in the FORM OF BONDS set forth in Exhibit B to this First Supplement and ... not theretofore credited against a mandatory redemption requirement. On the maturity date of such Term Bonds, the City shall apply the monies on hand in the Mandatory Redemption Account for the payment of the principal of the maturing Terra Bonds. If the monthly transfers to the Mandatory Redemption Account required hereby will produce a surplus in the Mandatory Redemption Account at maturity of such Term Bonds, the monthly transfers required on the account of such Term Bonds may be reduced accordingly and in approximately equal amounts. (b) Reserve Fund.- To the credit of the Reserve Fund, such amounts, deposited in approximately equal monthly installments, commencing during the month in which the Bonds are delivered, or the month thereafter if delivery is made after the ~h day -20- -~- , thereof, equal to not less than 1j~4 of the Required Reserve Amount, until such time as such amounts together with other amounts, if any, in the Reserve Fund, equal the Required Reserve Amount. When and so long as the Reserve Fund Obligations in the Reserve Fund are not less than the Required Reserve Amount, no deposits need be made to the credit of the Reserve Fund. When and if the Reserve Fund at any time contains less than the Required Reserve Amount due to any cause or condition then, subject and subordinate to making the required deposits to the credit of the Debt Service Fund, commencing with the month during which such deficiency occurs, such deficiency shall be made up from the next available Pledged Revenues or from any other sources available for such purpose, in the man er provided in the Master Ordinance. Reimbursements tolthe rovider, if any~f_~ Credit Facility shall constitute the making up of a deficiency to the extent that such reimbursements result in the reinstatement, in whole or in part, as the case may be, of the amount of the Credit Facility. Section 14. PAYMENT OF BONDS. That on or before the first scheduled interest payment date, and on or before each interest payment date and principal payment date thereafter while any of the Bonds are Outstanding and unpaid, the City shall make available to the~Paying Agent/Registrar, out of the Debt Service Fund (and the - -~...~t.~ - wRes~e_Fun ~, if necessary) monies sufficient to pay such interest on and such principal amount of the Bonds, as shall become due and mature on such dates, respectively, at maturity or by redemption prior to maturity. The Paying Agent/Registrar shall destroy all -21- ' `i , paid Bonds and furnish the City with an appropriate certificate of cancellation or destruction. Section 15. COVENANTS REGARDING TAX-EXEMPTION. That the Issuer covenants to refrain from any action which would adversely affect, or to take such action as to ensure, the treatment of the Bonds as obligations described in section 103 of 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 Issuer covenants as follows: (a) to take any action to assure that no more than ten percent of the proceeds of the Bonds or the projects financed therewith (less amounts deposited to a reserve fund, if any) are used for any "private business use", as defined in section 141(b)(6) of the Code or, if more than ten percent of the proceeds are so used, that amounts, whether or not received by the Issuer, 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 ten 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 five percent of the proceeds of the Bonds or the projects financed therewith (less amounts deposited into a reserve fund, if any) then the amount in excess of five -22- 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 five 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; (f ) 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 - (1) proceeds of the Bonds invested for a reasonable temporary period of three years or less or, in the case of a refunding bond, for a period of 30 days or less -23- ~, until such proceeds are needed for the purpose for which _~~ the Bonds are issued, (2) amounts invested in a bona fide debt service fund, within the meaning of section 1.103-13(b)(12) of the Treasury Regulations., and (3) amounts deposited in any reasonably required reserve or replacement fund to the extent such amounts do not exceed ten 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); (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(f) of the Code and to pay to the United States of America, not later than 60 days after the Bonds have been paid in full, 100 percent of the amount then required to be paid as a result of Excess Earnings under section 148(f) of the Code; and (i) to maintain such records as will enable the Issuer to fulfill its responsibilities under this Section and section 148 of the Code and to retain such records for at least six -24- years following the final payment of principal and interest on the Bonds. For purposes of the foregoing, the Issuer understands that in the case of a refunding bond., the term proceeds includes transferred proceeds and for purposes of clauses (a} and (b) above, proceeds of the refunded bonds expended prior to the date of the issuance of the Bonds. It is the understanding of the Issuer 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 Issuer 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 Issuer agrees to comply with the additional requirements to the extent necessary, in the opinion of nationally-recognized bond counsel, to preserve the exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In addition, any Designated Financial Officer is hereby authorized to execute any instrument concerning or relating to the tax-exempt status of the Bonds. -25- Section 16. AMENDMENT OF FIRST SUPPLEMENT. (a) That the owners of a majority in Outstanding Principal Amount of the Bonds shall have the right from time to time to approve any amendment to this First Supplement which may be deemed necessary or desirable by the City, provided, however, that nothing herein contained shall permit or be construed to permit the amendment of the terms and conditions in this First Supplement or in the Bonds so as to: (1) Make any change in the maturity of any of the Outstanding Bonds; (2) Reduce the rate of interest borne by any of the Outstanding Bonds; (3) Reduce the amount of the principal payable on the Outstanding Bonds; (4) Modify the terms of payment of principal of, premium, if .. any, or interest on the Outstanding Bonds or impose any conditions with respect to such payment; (5) Affect the rights of the owners of less than all of the Bonds then Outstanding; (6) Amend this clause (a) of this Section; or (7) Change the minimum percentage of the principal amount of Bonds necessary for consent to any amendment; unless such amendment or amendments shall be approved by the owners of all of the Bonds then Outstanding. -26- (bj That if at any time the City shall desire to amend the First Supplement under this Section, the City shall cause notice of the proposed amendment to be published in a financial newspaper or journal published in The City of New York, New York, and a newspaper of general circulation in the City, once during each calendar week for at least two successive calendar weeks. Such notice shall briefly set forth the nature of the proposed amendment and shall state that a copy thereof is on file at the principal office of the Paying AgentJRegistrar for inspection by all owners of the Bonds. Such publication is not required, however, if notice in writing is given to each owner of the Bonds. (c) That whenever at any time not less than 30 days, and within one year, from the date of the first publication of said notice or other service of written notice the City shall receive an instrument or instruments executed by the owners of at least a majority in Outstanding Principal Amount of the Bonds then Outstanding, which instrument or instruments shall refer to the proposed amendment described in said notice and which specifically consent to and approve such amendment in substantially the form of the copy thereof on file with the Paying Agent/Registrar, the governing body of the City may pass such amendment in substantially the same form. (d) That upon the passage of any such amendment pursuant to the provisions of this Section, this First Supplement shall be deemed to be amended in accordance with such amendment, and the respective rights, duties and obligations under this First -27- Supplement of the City and all the owners of then Outstanding Bonds shall thereafter be determined, exercised and enforced hereunder, subject in all respects to such amendment. (e} That any consent given by the //owners of a Bond pursuant to the provisions of this Section shall be irrevocable fora period of six months from the date of the first publication of the notice provided for in this Section, and shall be conclusive and binding upon all future owners of the same Bond during such period. Such consent may be revoked at any time after six months from the date of the first publication of such notice by the owner who gave such consent, or by a successor in title, by filing written notice thereof with the Paying AgentjRegistrar and the City, but such revocation shall not be effective if the owners of at least a majority in Outstanding Principal Amount of the Bonds have, prior to the attempted revocation, consented to and approved the amendment. (f) The foregoing provisions of this Section notwithstanding, the City by action of the City Council may amend this First Supplement without the consent of any owner of the Bonds or any other Parity Obligations, solely for any one or more of the following purposes: (1) To add to the covenants and agreements of the City in this First Supplement contained, other covenants and agreements thereafter to be observed, grant additional rights or remedies to the owners of the Bonds or to surrender, -28- M~ restrict or limit any right or power herein reserved to or conferred upon the City; (2) To make such provisions for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained in this First Supplement, or in regard to clarifying matters or questions arising under this First Supplement, as are necessary or desirable and not contrary to or inconsistent with this First Supplement and which shall not adversely affect the interests of the owners of the Bonds then Outstanding; (3) To modify any of the provisions of this First Supplement in any other respect whatever, provided that such modification shall be, and be expressed to be, effective only after the Bonds Outstanding at the date of the adoption of such modification shall cease to be Outstanding; (4) To make such amendments to this First Supplement as may be required, in the opinion of Bond Counsel, to ensure compliance with sections 103 and 141 through 150 of the Code and the regulations promulgated thereunder and applicable thereto; (5) To make such changes, modifications or amendments as may be necessary or desirable in order to allow the owners of the Bonds to thereafter avail themselves of a book-entry system for payments, transfers and other matters relating to the Bonds, which changes, modifications or amendments are not contrary to or inconsistent with other provisions of this -29- First Supplement and which shall not adversely affect the interests of the owners of the Bonds; (6) To make such changes, modifications or amendments as may be necessary or desirable in order to obtain or maintain the granting of a rating on the Bonds by a Rating Agency or to obtain or maintain a Credit Agreement or a Credit Facility issued in support of the Bonds; and (7) To make such changes, modifications or amendments as may be necessary or desirable, which shall not adversely affect the interests of the owners of the Bonds, in order, to the extent permitted by law, to facilitate the economic and practical utilization of interest rate swap agreements, foreign currency exchange agreements, or similar type of agreements with respect to the Bonds. Notice of any such amendment may be published by the City in the manner described in clause (b) of this Section; provided, however, that the publication of such notice shall not constitute a condition precedent to the adoption of such amendatory ordinance and the failure to publish such notice shall not adversely affect the implementation of such amendment as adopted pursuant to such amendatory ordinance. (g) Ownership of the Bonds shall be established by the Registration Books maintained by the Paying Agent/Registrar, in its capacity as registrar and transfer agent for the Bonds. Section 17. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS. (a) That in the event any Outstanding Bond is damaged, -30- 6 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 of damaged, mutilated, lost, stolen, or destroyed Bonds shall be made to the Paying Agent/Registrar. In every case of loss, theft, or destruction of a Bond, the applicant 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 applicant 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 applicant shall surrender to the Paying Agent/Registrar for cancellation the Bond so damaged or mutilated. (c) 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 -31- ~~, 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) Prior to the issuance of any replacement bond, the Paying Agent/Registrar shall charge the 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 First Supplement equally and proportionately with any and all other Bonds duly issued under this First Supplement. (e) In accordance with Section 6 of Article 717k-6, Texas Revised Civil Statutes, as amended, this Section of this First Supplement 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 Payinq 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 6(a) of this First Supplement for Bonds issued in exchange for other Bonds . Section 18. REASONS FOR REFUNDING. That the City has determined that in order to remove various covenants set forth in the Prior Lien Bond Ordinance which restrict the ability of the -32- City to establish and maintain an efficient financing system for the issuance of Parity Obligations (including the Bonds), it is in the best interest of the City to refund all of the Previously Issued Parity Bonds. The refunding of the Previously Issued Parity Bonds also will result in a net present value savings to the City and to the System.. The Series A Notes were issued to provide interim financing for various System projects, and the City has determined that it is in the best interest of the City to convert the interim financing into permanent financing by refunding the Series A Notes with a part of the proceeds of the Bonds. Section 19. FIRST SUPPLEMENT TO CONSTITUTE A CONTRACT; EQUAL SECURITY. That in consideration of the acceptance of the Bonds, the issuance of which is authorized hereunder, by those who shall hold the same from time to time, this First Supplement shall be deemed to be and shall constitute a contract between the City and the Holders from time to time of the Bonds and the pledge made in this First Supplement by the City and the covenants and agreements set forth in this First Supplement to be performed by the City shall be for the equal and proportionate benefit, security, and protection of all Holders, without preference, priority, or distinction as to security or otherwise of any of the Bonds authorized hereunder over any of the others by reason of time of issuance, sale, or maturity thereof or otherwise for any cause whatsoever, except as expressly provided in or permitted by this First Supplement. -33- Section 20. SEVERABILITY OF INVALID PROVISIONS. That if any one or more of the covenants, agreements, or provisions herein contained shall be held contrary to any express provisions of law or contrary to the policy of express law, though not expressly prohibited, or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements, or provisions shall be null and void and shall be deemed separable from the remaining covenants, agreements, or provisions and shall in no way affect the validity of any of the other provisions hereof or of the Bonds issued hereunder. Section 21. PAYMENT AND PERFORMANCE ON BUSINESS DAYS. That, except as provided to the contrary in the FORM OF BONDS set forth in Exhibit B to this First Supplement, whenever under the terms of this First Supplement or the Bonds, the performance date of any provision hereof or thereof, including the payment of principal of or interest. on the Bonds, shall occur on a day other than a Business Day, then the performance thereof, including the payment of principal of and interest on the Bonds, need not be made on such day but may be performed or paid, as the case may be, on the next succeeding Business Day with the same force and effect as if made on the date of performance or payment. Section 22. LIMITATION OF BENEFITS WITH. RESPECT TO THE FIRST SUPPLEMENT. That with the exception of the rights or benefits herein expressly conferred, nothing expressed or contained herein or implied from they provisions of this First Supplement or the Bonds is intended or should be construed to confer upon or give to -34- any person other than the City, the Holders, and the Paying Agent/Registrar, any legal or equitable right, remedy, or claim under or by reason of or in respect to this First Supplement or any covenant, condition, stipulation, promise, agreement, or provision herein contained. This First Supplement and all of the covenants, conditions, stipulations, promises, agreements, and provisions hereof are intended to be and shall be for and inure to the sole and exclusive benefit of the City, the Holders, and the Paying Agent/Registrar as herein and therein provided. Section 23. FURTHER PROCEDURES. That the Mayor, the City Secretary or Assistant City Secretary, any Designated Financial Officer, and all other officers, employees, and agents of the City, and each of them,. shall be and they are hereby expressly authorized, empowered, and directed from time to time and at any time to do and. perform all such acts and things and to execute, acknowledge, and deliver in the name and under the seal and on behalf of the Issuer all such instruments, whether or not herein mentioned,. as may be necessary or desirable in order to carry out the terms and provisions of this First Supplement, the Bonds, the Bond Purchase Agreement, the offering documents prepared in connection with the sale of the Bonds, the Paying Agent/Registrar Agreement described in Section 6 hereof, the Escrow Agreement or the redemption of those Previously Issued Parity Bonds called for redemption prior to their scheduled maturities. In case any officer whose signature appears on any Bond shall cease to be such officer before the delivery of such Bond, such signature shall -35- nevertheless be valid and sufficient for all purpose the same as if he or she had remained in office until such delivery. Section 24. APPROVAL AND REGISTRATION OF BOND5. That the Mayor of the City is hereby authorized to have control of the Bonds 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, said Comptroller of Public Accounts (or a deputy designated in writing to act for said Comptroller) shall manually sign the Comptroller's Registration Certificate accompanying the Bonds, and the seal of said Comptroller shall be impressed, or placed in facsimile, on each such certificate. Section 25. SALE OF BONDS. (a) That the sale of the Bonds to the Underwriters, at the purchase price described in the Bond Purchase Agreement, is hereby authorized, ratified and confirmed. One Bond in the principal amount maturing on each maturity date as set forth in Section 3 hereof shall be delivered to the Underwriters, and the Underwriters shall have the right to exchange such bonds as provided in Section 6 hereof without cost. (b) That the Bond Purchase Agreement setting forth the terms of the sale of the Bonds to the Underwriters, in substantially the form attached to this First Supplement, is hereby accepted, approved and authorized to be delivered in executed form to said Underwriters. -36- (c) That the offering documents prepared in connection with the sale of the Bonds, in substantially the form attached to this First Supplement, are hereby accepted, approved and authorized to be delivered in executed form to the Underwriters. Section 26. ESCROW AGREEMENT. That the City Manager of the City is hereby authorized and directed to execute, the City Secretary is authorized to attest, and the City Attorney is authorized to approve as to form, on behalf of the City, the Escrow Agreement covering the use of the moneys to be deposited with the "Escrow Agent" therein named for the benefit of the holders of the Refunded Obligations, the form of the Escrow Agreement being in substantially the form attached to this First Supplement. Section 27. MUNICIPAL BOND INSURANCE. That the City Manager or the designee thereof is hereby authorized to execute on or before the date of delivery of the Bonds any instruments necessary to obtain a municipal bond insurance .policy in support of the Bonds, as is anticipated by the offering documents and the Bond Purchase Agreement herein approved with respect to the sale of the Bonds, including, but not limited to, any insurance commitment issued by a municipal bond insurance company which agrees to issue a municipal bond new issue insurance policy in support of the Bonds. Section 28. REDEMPTION OF REFUNDED OBLIGATIONS. That the following of the Refunded Obligations are hereby called for redemption prior to their scheduled maturities, at the price of par plus accrued interest to the date fixed for redemption: -37- i° ~, A11 of such Series 1984 Bonds maturng in the years 1995 '.:through 2004, inclusive; Redemption Date: March 1, 1994; All of such Series 1986 Bonds maturing in the years 1998 through 2007, inclusive; Redemption Date: March 1, 1997; All of such Series 1986-A Bonds maturing in the years 1992 through 2001, inclusive, and in 2006; Redemption Date: March 1, 1997; All of such Series 1987 Bonds maturing in the years 1998 through 2007, inclusive; Redemption Date: March 1, 1997; and All of such Series 1988 Bonds maturing in the years 1999 through 2007, inclusive; Redemption Date: March 1, 1998. The City Secretary or Assistant City Secretary is hereby directed -- to coordinate with the paying agent for each such series of Refunded Obligations so called for redemption to give notice of such redemption, in substantially the form attached to t~hi~~ First Supplement, in accordance with the applicable terms of the Prior Lien Bond Ordinance. Section 29. DTC REGISTRATION. The Bonds initially shall be issued and delivered in such manner that no physical distribution of the Bonds will be made to the public, and The Depository Trust Company ("DTC"), New York, New York, initially will act as depository for the Bonds. DTC has represented that it is a limited purpose trust company incorporated under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered under Section 17A of the Securities Exchange Act of 1934, as amended, and the City accepts, but in no way verifies, such representations. The Bonds initially authorized by this First Supplement shall be delivered to and -38- registered in the name of CEDE & CO., the nominee of DTC. It is expected that DTC will hold the Bonds on behalf of the Underwriters and their respective participants. So long as each Bond is registered in the name o€ CEDE & CO., the Paying Agent/Registrar shall treat and deal with DTC the same in all respects as if it were the actual and beneficial owner thereof. It is expected that DTC will maintain a book-entry system which will identify ownership of the Bonds in integral amounts of $5,000, with transfers of ownership being effected on the records of DTC and its participants pursuant to rules and regulations established by them, and that the Bonds initially deposited with DTC shall be immobilized and not be further exchanged for substitute Bonds except as hereinafter provided. The City is not responsible or liable for any functions of DTC, will not be responsible for paying any fees or charges with respect to its services, will not be responsible or liable for maintaining, supervising, or reviewing the records of DTC or its participants, or protecting any interests or rights of the beneficial owners of the Bonds. It shall be the duty of the DTC Participants, as defined in the Official Statement herein approved, to make all arrangements with DTC to establish this book-entry system, the beneficial ownership of the Bonds, and the method of paying the fees and charges of DTC. The City does not represent, nor does it in any way covenant that the initial book-entry system established with DTC will be maintained in the future. Notwithstanding the initial establishment of the foregoing book- entry system with DTC, if for any reason any of the originally -39- :± delivered Bonds is duly filed with the Paying Agent/Registrar with proper request for transfer and substitution, as provided for in this First Supplement, substitute Bonds will be duly delivered as rvided in this First Supplement, and there will be no assurance representation that any book-entry system will be maintained for :h Bonds. To effect the establishment of the foregoing book- xy system, the Mayor or the City Manager are hereby authorized execute the "DTC Letter of Representation" in the form provided by DTC to evidence the City's intent to establish said book-entry system. Section 30. FUNDING OF RESERVE FUND. That the Director of Fiscal Services is hereby directed to take such steps as are necessary to cause to be deposited to the credit of the Reserve Fund, as soon as practicable on or after the date of delivery of the Bonds, an amount equal to the Required Reserve Amount, from available funds other than proceeds from the Bonds. Section ^31. PREAMBLE. That the preamble to this First Supplement is hereby incorporated by reference, and is to be considered a part of the operative text of this First Supplement. Section~2. IMMEDIATE EFFECT. That this First Supplement shall be effective immediately from and after its passage in accordance with the provisions of Section 2 of Chapter 25 of the Charter of the City, and it is accordingly so ordained. -40- ,.~. SIGNED AND SEALED THIS DAY OF , 1991. Mayor, City of Fort Worth, Texas City Secretary (SEAL) APPROVED AS TO FORM AND LEGALITY: City Attorney -41- .+ EBHIBIT A That, as used in this First Supplement, the following terms shall have the meanings set forth below, unless the text hereof specifically indicates otherwise: "Amortization Installment" means the amount of money which is required to be deposited into the Mandatory Redemption Account for retirement of Term Bonds (whether at maturity or by mandatory redemption and including redemption premium, if any). "Bond Purchase Agreement" means the Bond Purchase Contract, dated w December 10, 1991, by and among the City and tie AUnderwriters. "Bonds" means collectively, the Series 1991A Bonds and the Series 1991B Bonds. "Business Day" means a day other than a Sunday, Saturday, a legal holiday, or a day on which banking institutions in the city where the principal corporate trust office of the Paying Agent/Registrar is located are authorized by law or executive order to close. "Capitalized Interest Account" means the "City of Fort Worth, Texas Water and Sewer System Series 1991 Bonds Capitalized Interest Account" created within the Debt Service Fund and established by the First Supplement. "Escrow Agreement" means the Escrow Agreement, dated_ADecember 10 1991, by and between the City and,~Ameritrust Texas Nat- onnal ssA ociation. "First Supplement" means the ordinance authorizing the issuance of the Series 1991 Bonds. "Mandatory Redemption Account" means the Account known as the "City of Fort Worth, Texas Water and Sewer System Series 1991 Bonds Mandatory Redemption Account" created within the Debt Service Fund and established by the First Supplement. "Master Ordinance" means the "Master Ordinance establishing the City of Fort Worth Texas Water and Sewer System Revenue Financing Program", passed by the City on December 10, 1991. "Paying Agent/Registrar" means the financial institution specified in Section 6(a) of the First Supplement. "Previously Issued Parity Bonds" shall have the same meaning given said term in the preamble to the First Supplement. A-1 ., "Prior Lien Bond Ordinance" shall have the same meaning given term in the preamble to the First Supplement. "Refunded Obligations" means the Previously Issued Parity Bonds and the Series A Notes. "Registration Books" shall have the meaning given said term in Section 6(a~ of the First Supplement. "Series A Notes" means the City of Fort Worth, Texas Water and Sewer System Commercial Paper Notes, Series A, currently >utstanding in the principal amount of $50,000,000. "Series 1991A Bonds" shall mean the City of Fort Worth, Texas Water and Sewer System Revenue Refunding Bonds, Series 1991A, authorized by the First Supplement. "Series 1991B Bonds" shall mean the City of Fort Worth, Texas Water and Sewer System Revenue Refunding Bonds, Series 19918, authorized by the First Supplement. "Term Bonds" means those Series 1991A Bonds so designated in Section 3 of the First Supplemen . "Underwriters" means Merrill Lynch & Co., on its behalf and the underwriters named in the Bond Purchase Agreement. A-2 EBBIBIT H FORM. OF BONDS: SERIES 1991A BONDS NO. $ UNITED STATES OF AMERICA STATE OF TEXAS COUNTIES OF TARRANT AND DENTON CITY OF FORT WORTH, TEXAS WATER AND SEWER SYSTEM REVENUE REFUNDING BOND SERIES 1991~A MATURITY DATE INTEREST RATE ORIGINAL ISSUE DATE CUSIP December 1, 1991 ON THE MATURITY DATE SPECIFIED ABOVE, THE CITY OF FORT WORTH, IN TARRANT AND DENTON COUNTIES, TEXAS (the "Issuer"), hereby promises to pay to or to the registered assignee hereof (either being hereinafter called the "registered owner") the principal amount of and to pay interest thereon from the original issue date specified above, on~August 1.5,__1992 and semiannually on eachtFebruary 15 and ,~_QUS,_,.t 15 therea er o he maturity date specified above, or the date of redemption prior to maturity, at the interest rate per annum specified above; except that if the Paying Agent/Registrar's Authentication Certificate appearing on the face of this Bond is dated later than AAuc~ust 15, .1992, such interest is payable semiannually on each,Februarv 15 and~ugust 15 following such date. THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the United States of America, without exchange or collection charges. The principal of this Bond shall be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity or upon the date fixed for its redemption prior to maturity, at the principal corporate trust office ofAAmeritrust texas Naf.ional Association, which is the "Paying Agent/Registrar" for this Bond. 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 Issuer 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 las day of the month next preceding each such date (the "Record Date") on the B-1 f Registration Books kept by the Paying Agent/Registrar, as hereinafter described. Any accrued interest due at maturity or upon the redemption of this Bond prior to maturity as provided herein shall be paid to the registered owner upon presentation and surrender of this Bond for redemption and payment at the principal corporate trust office of the Paying Agent/Registrar. The Issuer has covenanted in the Bond Ordinance that on or before each principal payment date, interest payment date, and accrued interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Debt Service Fund" created by the ordinance establishing the City of Fort Worth, Texas Water and Sewer System Revenue Financing ro ram (the "Master Ordinance"), the amounts required to provi a or a payment, in immediately available funds, of all principal of and interest on the Bonds, when due. THE TERMS AND PROVISIONS of this Bond are continued on the reverse side hereof and shall for all purposes have the same effect as though fully set forth at this place. *IF THE DATE for the payment of the principal of or interest on this Bond shall be a Saturday, Sunday,. a legal holiday, or a day on which banking institutions in the City where the principal corporate trust office of the Paying Agent/Registrar is located are authorized by law or executive order to close, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are authorized to close; and payment on such date shall have the same force and effect as if made on the original date payment was due. *THIS BOND is one of a series of bonds of like tenor and effect except as to number, principal amount, interest rate, maturity, and right of prior redemption, dated as of the Original Issue Date specified above, aggregating X459.575.000 (herein some- times called the "Bonds"), whic , together with the "Cit of For Worth Texas Water and Sewer S s enue Re n on s Series 199 B" issue concurrentlY~herewithL are issued for the purpose of refunding-~h~'~' i s anding ind~e-b fines of the Ci_ t~ Fort Worth, Texas defined in the Bond Ordinance as the "Previously Issued Parity Bonds" and/~for the purpose of refunding,~$50.000.000 of the outstanding indebtedness of the City of Fort Worth, Texas defined in the Bond Ordinance as the "Series A Notes". *THE OUTSTANDING BONDS maturing on and after Februar 15, 2~0 may be redeemed prior to their scheduled maturi ies, at e option of the Issuer, in whole, or in part on~Februarv is_ iggg, or on any date thereafter, at the/redemption price of the principal amount of the Bonds called for redemption, plus accrued interest thereon to the date fixed for redemption, and without premium. B-2 *THE OUTSTANDING BONDS maturingaF'ebruarv 15 , 2 012 , are subject to mandatory redemption, and shall be redeemed in part by lot prior to maturity annually onAFebruarv 15 in the years~0og through~oll, inclusive, and at final maturity in 2~ 012 w_it-T-funds inn'-t'~ie "Mandatory Redemption Account" of the Debt Service Fund established in the Bond Ordinance, in accordance with the terms of the Master Ordinance, at a redemption price equal to the principal amount of such Bonds called for redemption, plus accrued interest to the. date fixed for redemption,, and without premium. *NOTICE OF any such redemption of Bonds shall be given in the following manner, to-wit, (i) a written notice of such redemption sha21 be given to the registered owner of each Bond or a portion thereof being called for redemption not more than 60 days nor less than 30 days prior to the date fixed for such redemption by depositing such notice in the United States Mail, first-class, postage prepaid, addressed to each such registered owner at his address shown on the Registration Books of the Paying Agent/Registrar and (ii) a notice of such redemption shall be published one time, at least 30 days prior to the date fixed for such redemption, in a journal or publication of general circulation in the United States of America which carries as a regular feature notices of redemption of municipal bonds; provided, however, that the failure to send, mail, or receive such notice described in clause (i) above, 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 Bond, as publication of notice as described in clause (ii) above shall be the only notice actually required in connection with or as a prerequisite to the redemption of any Bonds. By the date fixed for any such redemption due provision shall be made by the Issuer with the Paying Agent/Registrar for the payment of the required redemption price for this Bond or the portion hereof which is to be so redeemed, plus accrued interest thereon to the date fixed for redemption. If such notice of redemption is given, and if due provision for such payment is made, all as provided above, this Bond, or the portion hereof which is to be so redeemed, thereby automatically shall be redeemed prior to its scheduled maturity, and shall not bear or accrue interest after the date fixed for its redemption, and shall not be regarded as being outstanding except for the right of the registered owner to receive the redemption price plus accrued interest to the date fixed for redemption from the Paying Agent/Registrar out of the funds provided for such payment. The Paying Agent/Registrar shall record in the Registration Books all such redemptions of principal amount of this Bond or any portion hereof. If a portion of any Bond shall be redeemed a substitute Bond 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 an 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 Issuer, B-3 all as provided in the Bond Ordinance. The years of maturity of the Bonds called for such redemption shall be selected by the Issuer. The Bonds or portions thereof redeemed within a maturity shall be selected by lot or other customary random method selected by the Paying Agent/Registrar (provided that a portion of a Bond may be redeemed only in an integral multiple of $5,000). *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 may, at the request of the registered owner or the as- signee or assignees hereof, be assigned, transferred, converted into and exchanged for a like aggregate amount of fully registered Bonds, without interest coupons, payable to the appropriate registered owner, assignee or assignees, as the case may be, having any authorized denomination or denominations 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, evi- dencing assignment of this Bond or any portion or portions hereof in any authorized denomination 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 fora 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 one requesting such conversion and exchange shall pay the Paying AgentjRegistrar's reasonable standard or customary fees and charges for converting and exchanging any Bond or portion thereof. 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 foregoing notwithstanding, in the case of the conversion and exchange of an assigned and transferred Bond or Bonds or any portion or portions thereof, such fees and charges of the Paying Agent/Registrar will be paid by the Issuer. The Paying Agent/Registrar shall not be required (i) to make any such trans- fer, conversion or exchange during the period beginning at the opening of business 30 days before the day of the first mailing of a notice of redemption and ending at the close of business on the day of such mailing, or (ii) to transfer, convert or exchange any Bonds so selected for redemption when such redemption is scheduled B-4 to occur within 30 calendar days; provided, however, such limita- tion of transfer shall not be applicable to an exchange by the registered owner of an unredeemed balance of a Bond called for redemption in part. *IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly will appoint a competent and legally qualified substitute therefor, whose qualificationsA are substan Tally similar to the previous Paying Agent/Registrar it is replacing, and promptly will cause written notice thereof to be mailed to the registered owners of the Bonds. *BY BECOMING the registered owner of this Bond, the registered owner thereby acknowledges all of the terms and provisions of the Master Ordinance and the Bond Ordinance, agrees to be bound by such terms and provisions, acknowledges that the Master Ordinance and the Bond Ordinance are duly recorded and available for inspection in the official minutes and records of the Issuer, and agrees that the terms and provisions of this Bond, the Master Ordinance and the Bond Ordinance constitute a contract between. each registered owner hereof and the Issuer. All capitaliz` end terms not defined her~eV shall have. the same meanin as given sal terms in the Mas r Or finance or the Bon r finance. *THE BONDS are special obligations of the Issuer payable solely from and equally secured by a first lien on and pledge of the Pledged Revenues of the System. The Issuer has reserved the right, subject to the restrictions stated, and adopted by reference, in the Master Ordinance, to issue additional parity revenue obligations which also may be made payable from, and secured by a first lien on and pledge of, the aforesaid Pledged Revenues. For a more complete description and identification of the revenues and funds pledged to the payment of the Bonds, and other obligations of the Issuer secured by and payable from the same source or sources as the Bonds, reference is hereby made to the Master Ordinance and the Bond Ordinance. *THE ISSUER has reserved the right, subject to the restrictions stated, and adopted by reference, in the Bond Ordinance, to amend the Bond Ordinance; and under some (but not all) circumstances amendments must be approved by the owners of a majority in Outstanding Principal Amount of the Bonds. *THE REGISTERED OWNER HEREOF shall never have the right to demand payment of this obligation out of any funds raised or to be raised by taxation. *IT IS HEREBY certified. and covenanted that this Bond has been duly and validly authorized, issued and delivered; and that all acts, conditions and things required or proper to be performed, B-5 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. IN WITNESS WHEREOF, this Bond has been signed with the imprinted or lithographed manual or facsimile signature of the Mayor of said Issuer, attested by the imprinted or lithographed facsimile signature of the City Secretary, and approved as to form and legality by the imprinted or lithographed facsimile signature of the City Attorney, and the official seal of said Issuer has been duly affixed to, printed, lithographed or impressed on this Bond. CITY OF FORT WORTH, TEXAS (SEAL) By Mayor ATTEST: City Secretary APPROVED AS TO FORM AND LEGALITY: City Attorney B-6 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 proceedings adopted by the Issuer as described in the text of this Bond; and that this Bond has been issued in exchange for or replacement of a bond, bonds, or a portion of a bond or bonds of an issue 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 By Authorized Signatory Texas Paying Agent/Registrar B-7 *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. NOTICE: The signatures above must correspond with tie name of the Registered Owner as it appears upon the front of this Bond in every particular, without alteration or enlargement or any change whatsoever. B-8 ** FORM OF COMPTROLLER'S REGISTRATION CERTIFICATE: OFFICE OF COMPTROLLER REGISTER NO. STATE OF TEXAS . 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 (SEAL) NOTE TO PRINTER: *$s to be printed on back of Bond **1 not to be printed on Bond B-9 FORM OF BONDS: SERIES 1991B BONDS N0. $ UNITED STATES OF AMERICA STATE OF TEXAS COUNTIES OF TARRANT AND DENTON CITY OF FORT WORTH, TEXAS WATER AND SEWER SYSTEM REVENUE REFUNDING BOND SERIES 1991B MATURITY DATE INTEREST RATE ORIGINAL ISSUE DATE CUSIP December 1, 1991 ON THE MATURITY DATE SPECIFIED ABOVE, THE CITY OF FORT WORTH, IN TARRANT AND DENTON COUNTIES, TEXAS (the "Issuer"), hereby promises to pay to , or to the registered assignee hereof (either being hereinafter called the "registered owner") the principal amount of and to pay interest thereon from the original issue date specified above, on August 15, 1992 and semiannually on each February 15 and August 15 thereafter to the maturity date specified above, or the date of redemption prior to maturity, at the interest rate per annum specified above; except that if the Paying Agent/Registrar's Authentication Certificate appearing on the face of this Bond is dated later than August 15, 1992, such interest is payable semiannually on each February 15 and August 15 following such date . THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the United States of America, without exchange or collection charges. The principal of this Bond shall be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity or upon the date fixed for its redemption prior to maturity, at the principal corporate trust office of Ameritrust Texas National Association, which is the "Paying Agent/Registrar" for this Bond. 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 Issuer 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 fifteenth day of the month next preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described. Any accrued interest due at maturity or B-10 upon the redemption of this Bond prior to maturity as provided herein shall be paid to the registered owner upon presentation and surrender of this Bond for redemption and payment at the principal corporate trust office of the Paying Agent/Registrar. The Issuer has covenanted in the Bond Ordinance that on or before each principal payment date, interest payment date, and accrued interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Debt Service Fund" created by the ordinance establishing the City of Fort Worth, Texas Water and Sewer System Revenue Financing Program (the "Master Ordinance"), the amounts required to provide for the payment, in immediately available funds, of all principal of and interest on the Bonds, when due. THE TERMS AND PROVISIONS of this Bond are continued on the reverse side hereof and shall for all purposes have the same effect as though fully set forth at this place. *IF THE DATE for the payment of the principal of or interest on this Bond shall be a Saturday, Sunday, a legal holiday, or a day on which banking institutions in the City where the principal corporate trust office of the Paying .Agent/Registrar is located are authorized by law or executive order to close, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are authorized to close; and payment on such date shall have the same force and effect as if made on the original date payment was due. *THIS BOND is one of a series of bonds of like tenor and effect except as to number, principal amount, interest rate, maturity., and right of prior redemption, dated as of the Original Issue Date specified above, aggregating $1.51,475,000 (herein some- times called the "Bonds"), which, together with the "City of Fort Worth, Texas Water and Sewer System .Revenue Refunding Bonds, Series 1991A" issued concurrently herewith, are issued for the purpose of refunding the outstanding indebtedness of the City of Fort Worth, Texas defined in the Bond Ordinance as the "Previously Issued Parity Bonds" and for the purpose of refunding $50,000,000 of the outstanding indebtedness of the City of Fort Worth, Texas defined in the Bond Ordinance as the "Series A Notes". *THE OUTSTANDING BONDS maturing on and after February 15, 2000 may be redeemed prior to their scheduled maturities, at the option of the Issuer, in whole, or in part on February 15, 1999, or on any date thereafter, at the redemption price of the principal amount of the Bonds called for redemption, plus accrued interest thereon to the date fixed for redemption, and without premium. *NOTICE OF any such redemption of Bonds shall be given in the following manner, to-wit, (i) a written notice of such redemption shall be given to the registered owner of each Bond or a portion B-11 thereof being called for redemption not more than 60 days nor less than 30 days prior to the date fixed for such redemption by depositing such notice in the United States Mail, first-class, postage prepaid, addressed to each such registered owner at his address shown on the Registration Books of the Paying Agent/Registrar and (ii) a notice of such redemption shall be published one time, at least 30 days prior to the date fixed for such redemption, in a journal or publication of general circulation in the United States of America which carries as a regular feature notices of redemption of municipal bonds; provided, however,. that the failure to send, mail, or receive such notice described in clause (i) above, 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 Bond, as publication of notice as described in clause (ii) above shall be the only notice actually required in connection with or as a prerequisite to the redemption of any Bonds. By the date fixed for any such redemption due provision shall be made by the Issuer with the Paying Agent/Registrar for the payment of the required redemption price for this Bond or the portion hereof which is to be so redeemed, plus accrued interest thereon to the date fixed for redemption. If such notice of redemption is given, and if due provision for such payment is made, all as provided above, this Bond, or the portion hereof which is to be so redeemed, thereby automatically shall be redeemed prior to its scheduled maturity, and shall not bear or accrue interest after the date fixed for its. redemption, and shall not be regarded as being outstanding except for the right of the registered owner to receive the redemption price plus accrued interest to the date fixed for redemption from the Paying Agent/Registrar out of the funds provided for such payment. The Paying Agent/Registrar shall record in the Registration Books all such redemptions of principal amount of this-Bond or any portion hereof. If a portion of any Bond shall be redeemed a substitute Bond 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 an 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 Issuer, all as provided in the Bond Ordinance. The years of maturity of the Bonds called for such redemption shall be selected by the Issuer. The Bonds or portions thereof redeemed within a maturity shall be selected by lot or other customary random method selected by the Paying Agent/Registrar (provided that a portion of a Bond may be redeemed only in an integral multiple of $5,000). *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 may, at the request of the registered owner or the as- signee or assignees hereof, be assigned, transferred, converted into and exchanged for a like aggregate amount of fully registered B-12 Bonds, without interest coupons, payable to the appropriate registered owner, assignee or assignees, as the case may be, having any authorized denomination or denominations 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, evi- dencing assignment of this Bond or any portion or portions hereof in any authorized denomination 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 one requesting such conversion and exchange shall pay the Paying Agent/Registrar's reasonable standard or customary fees and charges for converting and exchanging any Bond or portion thereof. 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 foregoing notwithstanding, in the case of the conversion and exchange of an assigned and transferred Bond or Bonds or any portion or portions thereof, such fees and charges of the Paying Agent/Registrar will be paid by the Issuer. The Paying Agent/Registrar shall not be required (i) to make any such trans- fer, conversion or exchange during the period beginning at the opening of business 30 days before the day of the first mailing of a notice of redemption and ending at the close of business on the day of such mailing, or (ii) to transfer, convert or exchange any Bonds so selected for redemption when such redemption is scheduled to occur within 30 calendar days; provided, however, such limita- tion of transfer shall not be applicable to an exchange by the registered owner of an unredeemed balance of a Bond called for redemption in part. *IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly will appoint a competent and legally qualified substitute therefor, whose qualifications are substantially similar to the previous Paying Agent/Registrar it is replacing, and promptly will cause written notice thereof to be mailed to the registered owners of the Bonds. 8-13 *BY BECOMING the registered owner of this Bond, the registered owner thereby acknowledges all of the terms and provisions of the Master Ordinance and the Bond Ordinance, agrees to be bound by such terms and provisions, acknowledges that the Master Ordinance and the Bond Ordinance are duly recorded and available for inspection in the official minutes and records of the Issuer, and agrees that the terms and provisions of this Bond, the Master Ordinance and the Bond Ordinance constitute a contract between each registered owner hereof and the Issuer. All capitalized terms not defined herein shall have the same meaning as given said terms in the Master Ordinance or the Bond Ordinance. *THE BONDS are special obligations of the Issuer payable solely from and equally secured by a first lien on and pledge of the Pledged Revenues of the System. The Issuer has reserved the right, subject to the restrictions stated, and adopted by reference, in the Master Ordinance, to issue additional parity revenue obligations which also may be made payable from, and secured by a first lien on and pledge of, the aforesaid Pledged Revenues. For a more complete description and identification of the revenues and funds pledged to the payment of the Bonds, and other obligations of the Issuer secured by and payable from the same source or sources as the Bonds, reference is hereby made to the Master Ordinance and the Bond Ordinance. *THE ISSUER has reserved the right, subject to the restrictions stated, and adopted by reference, in the Bond Ordinance, to amend the Bond Ordinance; and under some (but not all) circumstances amendments must be approved by the owners of a majority in Outstanding Principal Amount of the Bonds. *THE REGISTERED OWNER HEREOF shall never have the right to demand payment of this obligation out of any funds raised or to be raised by taxation. *IT IS HEREBY certified and covenanted that this Bond has been duly and validly authorized, issued and delivered; and 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. IN WITNESS WHEREOF, this Bond has been signed with the imprinted or lithographed manual or facsimile signature of the Mayor of said Issuer, attested by the imprinted or lithographed facsimile signature of the City Secretary, and approved as to form and legality by the imprinted. or lithographed facsimile signature of the City Attorney, and the official seal of said Issuer has been duly affixed to, printed, lithographed or impressed on this Bond B-14 CITY OF FORT WORTH, TEXAS (SEAL) By Mayor ATTEST: City Secretary APPROVED AS TO FORM AND LEGALITY: City Attorney B-15 ~,. 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 proceedings adopted by the Issuer as described in the text of this Bond; and that this Bond has been issued in exchange for or replacement of a bond, bonds, or a portion of a bond or bonds of an issue 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 Paying Agent/Registrar By Authorized Signatory B-16 _ ?_ *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. NOTICE: The signatures above must correspond with the name of the Registered Owner as it appears upon the front of this Bond in every particular, without alteration or enlargement or any change whatsoever. B-17 /r+ r ** FO M OF COMPTROLLER'S REGISTRATION CERTIFICATE: OFFICE OF COMPTROLLER REGISTER NO. STATE OF TEXAS 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 (SEAL) NOTE TO PRINTER: *~[s to be printed on back of Bond **i not to be printed on Bond 8-18 MASTER YI~US~1~ ACCOUNT[N0.2 w ~y ,TRANSPCRTATiON~PUBL[C WORKS=a ~~ Of ~~ - ~- -7 ~~~~ V~ATER Af1f,AlNIf,TR it ~ ~ ~~ '~~~I,,~~'~ f~~'IL~~~ • FIN.ANCE~p y II I f L'AiVe 1' ~~`~T' 12/10/91 E UMB_9423 1360NDS 1 of 1 SUBJECT SALE OF WATER AND SEWER SYSTEM REVENUE REFUNDING BONDS, SERIES 1991A ANO 19916 RECOMMENDATION: It ~s recommended that the City Council approve: 1. Master Ordinance No. 10968 establishing the City of Fort Worth, Texas Water and Sewer System Revenue Financing Program, and 2. The First Supplemental Ordinance No. 10969 authorizing the Issuance and Sale of City of Fort Worth, Texas Water and Sewer System Revenue Refunding Bonds, Series 1991A and City of Fort Worth, Texas Water and Sewer System Revenue Refunding Bonds, Series 19916 and other matters related thereto. DISCUSSION: On D~ ecem~r 3, 1991, the City Council authorized the staff to proceed with establishing a master ordinance for the Revenue Financing Program of the Water and Sewer System. The Master Ordinance is intended to establish a master program under which revenue supported indebtedness attributable to the system and payable from pledged revenues can be incurred. Revenue debt may be issued, incurred or assumed pursuant to the terms of a Supplement. The supplement will provide the authorization, issuance, sale, delivery, form ,characteristics, provisions of payment and redemption, and security of each issue or Parity Obligation and any other matters related to Parity Obligation not inconsistent with the Constitution and laws of the State of Texas or the provisions of the ordinance. The City entered into a negotiated sale to complete the refunding of Water and Sewer Revenue Debt. The rocess concluded with the refunding of X150,630,000 Water and Sewer Revenue Bonds and 50,000,000 in Commercial Paper for Water and Sewer. The refunding of Water and Sewer Revenue Bonds had a present value saving of X2,108,020. The principal debt was reduced by X9,080,000. The total new debt for revenue and commercial paper is X192,825,000 verses the refunded debt of X200,630,000. Today, the Council is being asked to approve the master ordinance and the first supplement for the refunding. The proceeds from the refunding will be used to provide funds which with other available funds of the City Water and Sewer Fund will be sufficient to refund the outstanding revenue bonds and the Commercial Paper debt. CB:t u tte or C ty Manager's FUND ACCOUNT CENTER AMOUNT ITY SECR Y Office by: to p,p'pKUv~'~ '" `~Y council Charles Boswell 8500 ~ ~~CG OCt~Ii~Uii~:L ~:~OP ~~^~ Or nat n De argent Hea 9 9 P f, ~ G ~a ~hC3Pj ~~~~ ~ ~#~~ ~ _- ~ I~~ Qt Judson Bailiff 8185 rom ~,, ,,I 1r_ ~~ ~ ` For A dit ona In orsation ~,~. ~ ~''"~° Contact: --~'"°'~ of t~,o xet°"~ Judson Bdi 1 i ff 8185 Tex~~ C:tY ~`-° ~, PrfrRed on rotycJed D~