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HomeMy WebLinkAbout26785-03-2024 - City Council - OrdinanceOrdinance No. 26785-03-2024 AN ORDINANCE ADJUSTING ESTIMATED RECEIPTS AND APPROPRIATIONS IN THE GENERAL DEBT SERVICE FUND IN THE TOTAL AMOUNT OF $12,559,902.00, BY INCREASING APPROPRIATIONS BY $7,740,271.00 FROM AVAILABLE FUND BALANCE, AND BY REALLOCATING $4,819,631.00 PREVIOUSLY APPROPRIATED AS CONTRIBUTION TO FUND BALANCE TO THE DEBT ACCOUNTS, FOR THE PURPOSE OF FUNDING DEFEASANCE OF OUTSTANDING GENERAL DEBT SERVICE OBLIGATIONS; PROVIDING FOR A SEVERABILITY CLAUSE; MAKING THIS ORDINANCE CUMULATIVE OF PRIOR ORDINANCES; REPEALING ALL ORDINANCES IN CONFLICT HEREWITH; AND PROVIDING AN EFFECTIVE DATE. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS: SECTION 1. That in addition to those amounts allocated to the various City departments for Fiscal Year 2023-2024 in the Budget of the City Manager, there shall also be adjusted estimated receipts and appropriations in the General Debt Service Fund in the amount of $12,559,902.00, by increasing $7,740,271.00 from available fund balance, and by reallocating $4,819,631.00 previously appropriated as contribution to fund balance to the debt accounts, for the purpose of funding defeasance of outstanding general debt service obligations. SECTION 2. That should any portion, section or part of a section of this ordinance be declared invalid, inoperative or void for any reason by a court of competent jurisdiction, such decision, opinion or judgment shall in no way impair the remaining portions, sections, or parts of sections of this ordinance, which said remaining provisions shall be and remain in full force and effect. SECTION 3. That this ordinance shall be cumulative of Ordinance 26453-09-2023 and all other ordinances and appropriations amending the same except in those instances where the provisions of this ordinance are in direct conflict with such other ordinances and appropriations, in which instance said conflicting provisions of said prior ordinances and appropriations are hereby expressly repealed. SECTION 4. This ordinance shall take effect upon adoption. APPROVED AS TO FORM AND LEGALITY: Assistant City Attorney ADOPTED AND EFFECTIVE: March 26, 2024 CITY SECRETARY Jannette S. Goodall City Secretary a ��00000000 oar .s ° 0 -� P �o o� 0° 0 °� 0 0 ° °0 00. * c a% o 0 0000000 ,o' �� SEX AS Za' ESCROW AGREEMENT CITY OF FORT WORTH, TEXAS 2024 ESCROW THIS ESCROW AGREEMENT, dated as of April 24, 2024 (herein, together with any amendments or supplements hereto, called the "Agreement") is entered into by and between the City of Fort Worth, Texas (herein called the "Issuer") and BOKF, NA, as escrow agent (herein, together with any successor in such capacity, called the 'Escrow Agent"). The addresses of the Issuer and the Escrow Agent are shown on Exhibit "A" attached hereto and made a part hereof. WITNESSETH: WHEREAS, the Issuer heretofore issued and there presently remain outstanding the obligations (the "Defeased Obligations") described in the Verification Report of Robert Thomas CPA, LLC, a true and correct copy of which is attached hereto as Exhibit "B" and made a part hereof (the "Report"), relating to the Defeased Obligations; and WHEREAS, the Defeased Obligations are scheduled to mature on such dates, bear interest at such rates, and be payable at such times and in such amounts as are set forth in the Report; and WHEREAS, when firm banking arrangements have been made for the payment of principal and interest to the maturity or redemption date of the Defeased Obligations, then the Defeased Obligations shall no longer be regarded as outstanding except for the purpose of receiving payment from the funds provided for such purpose; and WHEREAS, Chapter 1207, Texas Government Code ("Chapter 1207"), authorizes the Issuer to deposit available funds of the Issuer directly with any place of payment (paying agent) for any of the Defeased Obligations, and such deposit, if made before such payment dates and in sufficient amounts, shall constitute the making of firm banking and financial arrangements for the discharge and final payment of the Defeased Obligations; and WHEREAS, Chapter 1207 further authorizes the Issuer to enter into an escrow agreement with any such paying agent for any of the Defeased Obligations with respect to the safekeeping, investment, administration and disposition of any such deposit, upon such terms and conditions as the Issuer and such paying agent may agree, provided that such deposits may be invested in direct obligations of the United States of America, including obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, and which may be in book entry form, and which shall mature and/or bear interest payable at such times and in such amounts as will be sufficient to provide for the scheduled payment of principal and interest on the Defeased Obligations when due; and WHEREAS, the Escrow Agent is the paying agent for the Defeased Obligations, and this Agreement constitutes an escrow agreement of the kind authorized and required by Chapter 1207; and WHEREAS, Chapter 1207 makes it the duty of the Escrow Agent to comply with the terms of this Agreement and timely make available the amounts required to provide for the payment of the principal of and interest on such obligations when due, and in accordance with their terms, but solely from the funds, in the manner, and to the extent provided in this Agreement; and WHEREAS, the Issuer has determined to fund with cash the deposit to the Escrow Fund created pursuant to the terms of this Agreement for the payment of the principal of the Defeased Obligations at their respective dates of maturity or date of redemption and the interest thereon to such dates; and WHEREAS, the Issuer desires that the cash deposited to the credit of such Escrow Fund shall be applied to purchase certain direct obligations of the United States of America hereinafter defined as the "Escrowed Securities" for deposit to the credit of the Escrow Fund created pursuant to the terms of this Agreement and to establish a beginning cash balance (if needed) in such Escrow Fund; and WHEREAS, the Escrowed Securities shall mature and the interest thereon shall be payable at such times and in such amounts so as to provide moneys which, together with any cash balances from time to time on deposit in the Escrow Fund, will be sufficient to pay interest on the Defeased Obligations as it accrues and becomes payable and the principal of the Defeased Obligations on their respective dates of maturity or date of redemption; and WHEREAS, to facilitate the receipt and transfer of proceeds of the Escrowed Securities, particularly those in book entry form, the Issuer desires to establish the Escrow Fund at the designated corporate trust office of the Escrow Agent; and WHEREAS, the Escrow Agent is herein also referred to as the "Paying Agent", and in such capacity as paying agent for the Defeased Obligations, acting through the Escrow Agent, is also a party to this Agreement, as the sole Paying Agent for the Defeased Obligations, to acknowledge its acceptance of the terms and provisions of this Agreement in such capacity. NOW, THEREFORE, in consideration of the mutual undertakings, promises and Agreements herein contained, the sufficiency of which hereby are acknowledged, and to secure the full and timely payment of principal of and the interest on the Defeased Obligations, the Issuer and the Escrow Agent mutually undertake, promise, and agree for themselves and their respective representatives and successors, as follows: ARTICLE I DEFINITIONS AND INTERPRETATIONS Section 1.01. Definitions. Unless the context clearly indicates otherwise, the following terms shall have the meanings assigned to them below when they are used in this Agreement: "Code" means the Internal Revenue Code of 1986, as amended, or to the extent applicable the Internal Revenue Code of 1954, together with any other applicable provisions of any successor federal income tax laws. 2 "Escrow Fund" means the fund created by this Agreement to be administered by the Escrow Agent pursuant to the provisions of this Agreement. "Escrowed Securities" means the direct noncallable, non -prepayable United States Treasury obligations and obligations the due timely payment of which is unconditionally guaranteed by the United States of America described in the Report or cash or other direct obligations of the United States of America substituted therefor pursuant to Article IV of this Agreement. Section 1.02. Other Definitions. The terms "Agreement", "Defeased Obligations", "Escrow Agent", "Issuer", "Paying Agent" and "Report", when they are used in this Agreement, shall have the meanings assigned to them in the preamble to this Agreement. Section 1.03. Interpretations. The titles and headings of the articles and sections of this Agreement have been inserted for convenience and reference only and are not to be considered a part hereof and shall not in any way modify or restrict the terms hereof. This Agreement and all of the terms and provisions hereof shall be liberally construed to effectuate the purposes set forth herein and to achieve the intended purpose of providing for the defeasance of the Defeased Obligations in accordance with applicable law. ARTICLE II DEPOSIT OF FUNDS AND ESCROWED SECURITIES The Issuer shall deposit, or cause to be deposited, with the Escrow Agent, for deposit in the Escrow Fund, the funds and Escrowed Securities described in the Report, and the Escrow Agent shall, upon the receipt thereof, acknowledge such receipt to the Issuer in writing. ARTICLE III CREATION AND OPERATION OF ESCROW FUND Section 3.01. Escrow Fund. The Escrow Agent has created on its books two separate, special trust funds and irrevocable escrows to be known as the City of Fort Worth, Texas Combination Tax and Revenue Certificates of Obligation, Series 2012 Escrow Fund (the "2012 Escrow Fund") and the General Purpose Refunding and Improvement Bonds, Series 2013 Defeasnece Escrow Fund (the "2013 Escrow Fund", and together with the 2012 Escrow Fund, the 'Escrow Fund"). The Escrow Agent hereby agrees that upon receipt thereof it will irrevocably deposit to the credit of the Escrow Fund the funds and the Escrowed Securities described in the Report. Such deposit, all proceeds therefrom, and all cash balances from time to time on deposit therein (a) shall be the property of the Escrow Fund, (b) shall be applied only in strict conformity with the terms and conditions of this Agreement, and (c) are hereby irrevocably pledged to the payment of the principal of and interest on the Defeased Obligations, which payment shall be made by timely transfers of such amounts at such times as are provided for in Section 3.02 hereof. When the final transfers have been made for the payment of such principal of and interest on the Defeased Obligations, any balance then remaining in the Escrow Fund shall be transferred to the Issuer, and the Escrow Agent shall thereupon be discharged from any further duties hereunder. 3 Section 3.02. Payment of Principal and Interest. The Escrow Agent is hereby irrevocably instructed to transfer from the cash balances from time to time on deposit in the Escrow Fund, the amounts required to pay the principal of the Defeased Obligations and interest thereon in the amounts and on the date shown in the Report. Section 3.03. Sufficiency of Escrow Fund. The Issuer represents that the successive receipts of the principal of and interest on the Escrowed Securities will assure that the cash balances on deposit from time to time in the Escrow Fund will be at all times sufficient to provide moneys for transfer to the Paying Agent at the times and in the amounts required to pay the interest on the Defeased Obligations as such interest comes due and the principal of the Defeased Obligations as the Defeased Obligations mature, all as more fully set forth in the Report. If, for any reason, at any time, the cash balances on deposit or scheduled to be on deposit in the Escrow Fund shall be insufficient to transfer the amounts required by each place of payment (paying agent) for the Defeased Obligations to make the payments set forth in Section 3.02 hereof, the Issuer shall timely deposit in the Escrow Fund, from any funds that are lawfully available therefor, additional funds in the amounts required to make such payments. Notice of any such insufficiency shall be given as promptly as practicable as hereinafter provided, but the Escrow Agent shall not in any manner be responsible for any insufficiency of funds in the Escrow Fund or the Issuer's failure to make additional deposits thereto. Section 3.04. Trust Fund. The Escrow Agent shall hold at all times the Escrow Fund, the Escrowed Securities and all other assets of the Escrow Fund, wholly segregated from all other funds and securities on deposit with the Escrow Agent; it shall never allow the Escrowed Securities or any other assets of the Escrow Fund to be commingled with any other funds or securities of the Escrow Agent; and it shall hold and dispose of the assets of the Escrow Fund only as set forth herein. The Escrowed Securities and other assets of the Escrow Fund shall always be maintained by the Escrow Agent as trust funds for the benefit of the owners of the Defeased Obligations; and a special account thereof shall at all times be maintained on the books of the Escrow Agent. The owners of the Defeased Obligations shall be entitled to the same preferred claim and first lien upon the Escrowed Securities, the proceeds thereof, and all other assets of the Escrow Fund to which they are entitled as owners of the Defeased Obligations. The amounts received by the Escrow Agent under this Agreement shall not be considered as a banking deposit by the Issuer, and the Escrow Agent shall have no right to title with respect thereto except as a constructive trustee and Escrow Agent under the terms of this Agreement. The amounts received by the Escrow Agent under this Agreement shall not be subject to warrants, drafts or checks drawn by the Issuer or, except to the extent expressly herein provided, by the Paying Agent. Section 3.05. Security for Cash Balances. Cash balances from time to time on deposit in the Escrow Fund shall, to the extent not insured by the Federal Deposit Insurance Corporation or its successor, be continuously collateralized by securities or obligations which qualify and are eligible under both the laws of the State of Texas and the laws of the United States of America, having a market value at least equal to such cash balances. 4 ARTICLE IV LIMITATION ON INVESTMENTS Section 4.01. Dutv of Escrow Agent to Investment Funds. Except as provided in Sections 3.02, 4.02 and 4.03 hereof, the Escrow Agent shall not have any power or duty to invest or reinvest any money held hereunder, or to make substitutions of the Escrowed Securities, or to sell, transfer or otherwise dispose of the Escrowed Securities. Section 4.02. Substitutions and Reinvestments. At the direction of the Issuer, the Escrow Agent shall reinvest cash balances representing receipts from the Escrowed Securities, make substitutions of the Escrowed Securities or redeem the Escrowed Securities and reinvest the proceeds thereof in other Escrowed Securities or hold such proceeds as cash, together with other moneys or securities held in the Escrow Fund, provided that the Issuer delivers to the Escrow Agent the following: (1) an opinion by an independent certified public accountant that after such substitution or reinvestment the principal amount of the securities in the Escrow Fund, together with the interest thereon and other available moneys, will be sufficient to pay, without further investment or reinvestment, as the same become due in accordance with the Report, the principal of, interest on and premium, if any, on the Defeased Obligations which have not previously been paid, and (2) an unqualified opinion of nationally recognized municipal bond counsel to the effect that (a) such substitution or reinvestment will not cause the Defeased Obligations to be "arbitrage bonds" within the meaning of section 103 of the Code or the regulations thereunder in effect on the date of such substitution or reinvestment, or otherwise make the interest on the Defeased Obligations subject to federal income taxation, and (b) such substitution or reinvestment complies with the Constitution and laws of the State of Texas and with all relevant documents relating to the issuance of the Defeased Obligations. The Escrow Agent shall have no responsibility or liability for loss or otherwise with respect to investments made at the direction of the Issuer. Section 4.03. Substitution for Escrowed Securities. Concurrently with the initial deposit by the Issuer with the Escrow Agent, but not thereafter, the Issuer, at its option, may substitute cash or non -interest bearing direct noncallable, non -prepayable obligations of the United States Treasury (i.e., Treasury obligations which mature and are payable in a stated amount on the maturity date thereof, and for which there are no payments other than the payment made on the maturity date) (the "Substitute Obligations") for non -interest bearing Escrowed Securities, if any, but only if such Substitute Obligations (a) are in an amount, and/or mature in an amount, which is equal to or greater than the amount payable on the maturity date of the obligation listed in the Report for which such Substitute Obligation is substituted, (b) mature on or before the maturity date of the obligation listed in the Report for which such Substitute Obligation is substituted, and (c) produce the amount necessary to pay the interest on and principal of the Defeased Obligations, as set forth in the Report, as verified by a certified public accountant or a firm of certified public accountants. If, concurrently with the initial deposit by the Issuer with the Escrow Agent, any such Substitute Obligations are so substituted for any Escrowed Securities, the Issuer may, at any time thereafter, substitute for such Substitute Obligations the same Escrowed Securities for which such Substitute Obligations originally were substituted. Section 4.04. Arbitrate. The Issuer hereby covenants and agrees that it shall never request the Escrow Agent to exercise any power hereunder or permit any part of the money in the Escrow Fund or proceeds from the sale of Escrowed Securities to be used directly or indirectly to acquire any securities or obligations if the exercise of such power or the acquisition of such securities or obligations would cause any Defeased Obligations to be an "arbitrage bond" within the meaning of the Code. ARTICLE V APPLICATION OF CASH BALANCES Except as provided in Sections 3.01, 3.02, 4.02 and 4.03 hereof, no withdrawals, transfers, or reinvestment shall be made of cash balances in the Escrow Fund. ARTICLE VI Section 6.01. Records. The Escrow Agent will keep books of record and account in which complete and correct entries shall be made of all transactions relating to the receipts, disbursements, allocations and application of the money and Escrowed Securities deposited to the Escrow Fund and all proceeds thereof, and such books shall be available for inspection at reasonable hours and under reasonable conditions by the Issuer and the owners of the Defeased Obligations. Section 6.02. Reports. While this Agreement remains in effect, the Escrow Agent annually shall prepare and send to the Issuer a written report summarizing all transactions relating to the Escrow Fund during the preceding year, including, without limitation, credits to the Escrow Fund as a result of interest payments on or maturities of the Escrowed Securities and transfers from the Escrow Fund for payments on the Defeased Obligations or otherwise, together with a detailed statement of all Escrowed Securities and the cash balance on deposit in the Escrow Fund as of the end of such period. ARTICLE VII CONCERNING THE PAYING AGENTS AND ESCROW AGENT Section 7.01. Representations. The Escrow Agent hereby represents that it is the duly acting Paying Agent for the Defeased Obligations, it has all necessary power and authority to enter into this Agreement and undertake the obligations and responsibilities imposed upon it herein, and that it will carry out all of its obligations hereunder. 6 Section 7.02. Verifications of Statutory Representations and Covenants. The Escrow Agent makes the following representations and covenants pursuant to Chapters 2252, 2271, 2274, and 2276, Texas Government Code, as amended (the "Government Code"), in entering into this Agreement. As used in such verifications, "affiliate" means an entity that controls, is controlled by, or is under common control with the Escrow Agent within the meaning of SEC Rule 405, 17 C.F.R. § 230.405, and exists to make a profit. Liability for breach of any such verification during the term of this Agreement shall survive until barred by the applicable statute of limitations, and shall not be liquidated or otherwise limited by any provision of this Agreement, notwithstanding anything in this Agreement to the contrary. (a) Not a Sanctioned Companv. The Escrow Agent represents that neither it nor any of its parent company, wholly- or majority -owned subsidiaries, and other affiliates is a company identified on a list prepared and maintained by the Texas Comptroller of Public Accounts under Section 2252.153 or Section 2270.0201, Government Code. The foregoing representation excludes the Escrow Agent and each of its parent company, wholly- or majority -owned subsidiaries, and other affiliates, if any, that the United States government has affirmatively declared to be excluded from its federal sanctions regime relating to Sudan or Iran or any federal sanctions regime relating to a foreign terrorist organization. (b) No Bovcott of Israel. The Escrow Agent hereby verifies that it and its parent company, wholly- or majority -owned subsidiaries, and other affiliates, if any, do not boycott Israel and will not boycott Israel during the term of this Agreement. As used in the foregoing verification, "boycott Israel" has the meaning provided in Section 2271.001, Government Code. (c) No Discrimination Against Firearm Entities. The Escrow Agent hereby verifies that it and its parent company, wholly- or majority -owned subsidiaries, and other affiliates, if any, do not have a practice, policy, guidance, or directive that discriminates against a firearm entity or firearm trade association and will not discriminate against a firearm entity or firearm trade association during the term of this Agreement. As used in the foregoing verification, "discriminate against a firearm entity or firearm trade association" has the meaning provided in Section 2274.001(3), Government Code. (d) No Bovcott of Enerav Companies. The Escrow Agent hereby verifies that it and its parent company, wholly- or majority -owned subsidiaries, and other affiliates, if any, do not boycott energy companies and will not boycott energy companies during the term of this Agreement. As used in the foregoing verification, "boycott energy companies" has the meaning provided in Section 2276.001(1), Government Code. Section 7.03. Limitation on Liabilitv. The liability of the Escrow Agent to transfer funds for the payment of the principal of and interest on the Defeased Obligations shall be limited to the proceeds of the Escrowed Securities and the cash balances from time to time on deposit in the Escrow Fund. Notwithstanding any provision contained herein to the contrary, neither the Escrow Agent nor the Paying Agent shall have any liability whatsoever for the insufficiency of funds from time to time in the Escrow Fund or any failure of the obligors of the Escrowed Securities to make timely payment thereon, except for the obligation to notify the Issuer as promptly as practicable of any such occurrence. 7 The recitals herein shall be taken as the statements of the Issuer and shall not be considered as made by, or imposing any obligation or liability upon, the Escrow Agent. The Escrow Agent is not a party to the proceedings authorizing the Defeased Obligations and is not responsible for nor bound by any of the provisions thereof (except as a place of payment and paying agent and/or a Paying Agent/Registrar therefor). In its capacity as Escrow Agent, it is agreed that the Escrow Agent need look only to the terms and provisions of this Agreement. The Escrow Agent makes no representations as to the value, conditions or sufficiency of the Escrow Fund, or any part thereof, or as to the title of the Issuer thereto, or as to the security afforded thereby or hereby, and the Escrow Agent shall not incur any liability or responsibility in respect to any of such matters. It is the intention of the parties hereto that the Escrow Agent shall never be required to use or advance its own funds or otherwise incur personal financial liability in the performance of any of its duties or the exercise of any of its rights and powers hereunder. The Escrow Agent shall not be liable for any action taken or neglected to be taken by it in good faith in any exercise of reasonable care and believed by it to be within the discretion or power conferred upon it by this Agreement, nor shall the Escrow Agent be responsible for the consequences of any error of judgment; and the Escrow Agent shall not be answerable except for its own action, neglect or default, nor for any loss unless the same shall have been through its negligence or willful misconduct. Unless it is specifically otherwise provided herein, the Escrow Agent has no duty to determine or inquire into the happening or occurrence of any event or contingency or the performance or failure of performance of the Issuer with respect to arrangements or contracts with others, with the Escrow Agent's sole duty hereunder being to safeguard the Escrow Fund, to dispose of and deliver the same in accordance with this Agreement. If, however, the Escrow Agent is called upon by the terms of this Agreement to determine the occurrence of any event or contingency, the Escrow Agent shall be obligated, in making such determination, only to exercise reasonable care and diligence, and in event of error in making such determination the Escrow Agent shall be liable only for its own willful misconduct or its negligence. In determining the occurrence of any such event or contingency the Escrow Agent may request from the Issuer or any other person such reasonable additional evidence as the Escrow Agent in its discretion may deem necessary to determine any fact relating to the occurrence of such event or contingency, and in this connection may make inquiries of, and consult with, among others, the Issuer at any time. The Escrow Agent may conclusively rely and shall be protected in acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, or other paper or document reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties. The Escrow Agent may consult with counsel, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it in good faith and in accordance therewith. Section 7.04. Compensation. (a) Concurrently with the deposit of cash to the credit of the Escrow Fund by the Issuer, the Issuer shall pay to the Escrow Agent, as a fee for performing the services hereunder and for all expenses incurred or to be incurred by the Escrow Agent in the 8 administration of this Agreement, and for all future paying agency services as Paying Agent for certain of the Defeased Obligations, $1,600, the sufficiency of which is hereby acknowledged by the Escrow Agent. In the event that the Escrow Agent is requested to perform any extraordinary services hereunder, the Issuer hereby agrees to pay reasonable fees to the Escrow Agent for such extraordinary services and to reimburse the Escrow Agent for all expenses incurred by the Escrow Agent in performing such extraordinary services, and the Escrow Agent hereby agrees to look only to the Issuer for the payment of such fees and reimbursement of such expenses. The Escrow Agent hereby agrees that in no event shall it ever assert any claim or lien against the Escrow Fund for any fees for its services, whether regular or extraordinary, as Escrow Agent, or in any other capacity, or for reimbursement for any of its expenses. (b) Upon receipt of the aforesaid specific sums stated in subsection (a) of this Section 7.03 for Escrow Agent and paying agency fees, expenses, and services, the Escrow Agent shall acknowledge such receipt to the Issuer in writing. Section 7.05. Successor Escrow Agents. If at any time the Escrow Agent or its legal successor or successors should become unable, through operation or law or otherwise, to act as escrow agent hereunder, or if its property and affairs shall be taken under the control of any state or federal court or administrative body because of insolvency or bankruptcy or for any other reason, a vacancy shall forthwith exist in the office of Escrow Agent hereunder. In such event the Issuer, by appropriate action, promptly shall appoint an Escrow Agent to fill such vacancy. If no successor Escrow Agent shall have been appointed by the Issuer within 60 days, a successor may be appointed by the owners of a majority in principal amount of the Defeased Obligations then outstanding by an instrument or instruments in writing filed with the Issuer, signed by such owners or by their duly authorized attorneys -in -fact. If, in a proper case, no appointment of a successor Escrow Agent shall be made pursuant to the foregoing provisions of this section within three months after a vacancy shall have occurred, the Escrow Agent may appoint a successor or petition any court of competent jurisdiction for the appointment of a successor Escrow Agent or for other appropriate relief. Such court may thereupon, after such notice, if any, as it may deem proper, prescribe and appoint a successor Escrow Agent. Any successor Escrow Agent shall be a corporation organized and doing business under the laws of the United States or the State of Texas, authorized under such laws to exercise corporate trust powers, authorized under Texas law to act as an escrow agent, having its principal office and place of business in the State of Texas, having a combined capital and surplus of at least $50,000,000 and subject to the supervision or examination by Federal or State authority. Any successor Escrow Agent shall execute, acknowledge and deliver to the Issuer and the Escrow Agent an instrument accepting such appointment hereunder, and the Escrow Agent shall execute and deliver an instrument transferring to such successor Escrow Agent, subject to the terms of this Agreement, all the rights, powers and trusts of the Escrow Agent hereunder. Upon the request of any such successor Escrow Agent, the Issuer shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor Escrow Agent all such rights, powers and duties. The Escrow Agent at the time acting hereunder may at any time resign and be discharged from the trust hereby created by giving not less than sixty (60) days' written notice to the Issuer and publishing notice thereof, specifying the date when such resignation will take effect, in a newspaper printed in the English language and with general circulation in New York, New York, 9 such publication to be made once at least three (3) weeks prior to the date when the resignation is to take effect. No such resignation shall take effect unless a successor Escrow Agent shall have been appointed by the owners of the Defeased Obligations or by the Issuer as herein provided and such successor Escrow Agent shall be a paying agent for the Defeased Obligations and shall have accepted such appointment, in which event such resignation shall take effect immediately upon the appointment and acceptance of a successor Escrow Agent. If the sixty (60) day notice period expires and no successor has been appointed, the Escrow Agent, at the expense of the Issuer, has the right to petition a court of competent jurisdiction to appoint a successor under this Agreement. Under any circumstances, the Escrow Agent shall pay over to its successor Escrow Agent proportional parts of the Escrow Agent's fee and, if applicable, its Paying Agent's fee hereunder. Section 7.06. Indemnitv. To the extent permitted by law, the Issuer agrees to indemnify and save harmless the Escrow Agent from all losses, liabilities, costs and expenses, including reasonable attorney's fees and expenses, which may be incurred by the Escrow Agent as a result of its acceptance of the Escrow Fund or arising from the performance of its duties hereunder, unless such losses, liabilities, costs and expenses have resulted from the bad faith or negligence of the Escrow Agent, and such indemnification shall survive the resignation by or removal of the Escrow Agent, or the termination of this Agreement. ARTICLE VIII MISCELLANEOUS Section 8.01. Notice. Any notice, authorization, request, or demand required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given when mailed by registered or certified mail, postage prepaid addressed to the Issuer or the Escrow Agent at the address shown on Exhibit "A" attached hereto. The United States Post Office registered or certified mail receipt showing delivery of the aforesaid shall be conclusive evidence of the date and fact of delivery. Any parry hereto may change the address to which notices are to be delivered by giving to the other parties not less than ten (10) days prior notice thereof. Prior written notice of any amendment to this Agreement contemplated pursuant to Section 8.08 and immediate written notice of any incidence of a severance pursuant to Section 8.04 shall be sent to Moody's Investors Service, Attn: Public Finance Rating Desk/Defeased Obligations, 99 Church Street, New York, New York 10007; Standard & Poor's Corporation, Attn: Municipal Bond Department, 25 Broadway, New York, New York 10004; and Fitch Ratings, Attn: Municipal Structured Finance, One State Street Plaza, New York, New York 10004. Section 8.02. Termination of Responsibilities. Upon the taking of all the actions as described herein by the Escrow Agent, the Escrow Agent shall have no further obligations or responsibilities hereunder to the Issuer, the owners of the Defeased Obligations or to any other person or persons in connection with this Agreement. Section 8.03. Binding Agreement. This Agreement shall be binding upon the Issuer and the Escrow Agent and their respective successors and legal representatives, and shall inure solely to the benefit of the owners of the Defeased Obligations, the Issuer, the Escrow Agent and their respective successors and legal representatives. 10 Section 8.04. Severabilitv. In case any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement, but this Agreement shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. Section 8.05. Texas Law Governs. This Agreement shall be governed exclusively by the provisions hereof and by the applicable laws of the State of Texas. Section 8.06. Time of the Essence. Time shall be of the essence in the performance of obligations from time to time imposed upon the Escrow Agent by this Agreement. Section 8.07. Effective Date of Agreement. This Agreement shall be effective upon receipt by the Escrow Agent of the funds described in the Report and the Escrowed Securities, together with the specific sums stated in subsection (a) of Section 7.03 for Escrow Agent and paying agency fees, expenses, and services. Section 8.08. Amendments. This Agreement shall not be amended except to cure any ambiguity or formal defect or omission in this Agreement. No amendment shall be effective unless the same shall be in writing and signed by the parties thereto. No such amendment shall adversely affect the rights of the holders of the Defeased Obligations. Section 8.09. Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute one and the same Agreement. The delivery of copies of this Agreement as executed by Adobe Acrobat PDF or similar electronic form of execution, or by electronic reproduction of a manual signature transmitted via electronic mail or facsimile, shall constitute effective execution and delivery as to the parties and may be used in lieu of originals for all purposes. [EXECUTION PAGES FOLLOW] II EXECUTED as of the date first written above. ATTEST: City Secretary CITY OF FORT WORTH, TEXAS City Manager Signature Page - Escrow Agreement (CITY SEAL) BOKF, NA, Escrow Agent Title: Signature Page - Escrow Agreement INDEX TO EXHIBITS Exhibit "A" Addresses of the Issuer and the Escrow Agent Exhibit "B" Verification Report of Robert Thomas CPA, LLC EXHIBIT "A" ADDRESSES OF THE ISSUER AND ESCROW AGENT ISSUER City of Fort Worth, Texas 200 Texas Street Fort Worth, Texas 76102 Attention: City Manager ESCROW AGENT BOKF, NA 5956 Sherry Lane, Suite 1201 Dallas, Texas 75225 Attention: Financial Services EXHIBIT "B" VERIFICATION REPORT OF ROBERT THOMAS CPA, LLC City of Fort Worth, Texas Mayor and Council Communication DATE: 03/26/24 M&C FILE NUMBER: M&C 24-0232 LOG NAME: 13CASH DEFEASANCE 2012 CO AND 2013 GEN PURP BONDS SUBJECT (ALL) Adopt Resolution Authorizing Cash Defeasance of Combination Tax & Revenue Certificates of Obligation, Series 2012 and General Purpose Refunding and Improvement Bonds, Series 2013 to Achieve Savings; Adopt Appropriation Ordinance; and Amend the Fiscal Year 2024 Adopted Budget RECOMMENDATION: It is recommended that the City Council: 1. Adopt the attached resolution authorizing cash defeasance of City of Fort Worth, Texas Combination Tax and Revenue Certificates of Obligation, Series 2012 and General Purpose Refunding and Improvement Bonds, Series 2013, including principal, accrued interest, and transaction costs, to achieve projected net present value savings in the estimated amount of $339,105.65 or 1.37 percent; 2. Adopt the attached ordinance adjusting estimated receipts and appropriations in the General Debt Service Fund in the total amount of $12,559,902.00, by increasing appropriations by $7,740,271.00 from available fund balance, and by reallocating $4,819,631.00 previously appropriated as contribution to fund balance to the debt accounts, for the purpose of funding defeasance of outstanding general debt service obligations, with such amount subject to reduction to conform to final figures at the time of defeasance; and 3. Amend the Fiscal Year 2024 Adopted Budget. DISCUSSION: The purpose of this Mayor and Council Communication (M&C) is to take actions associated with defeasance of outstanding general debt service obligations in order to achieve savings. Each year, the Financial Management Services Department, in conjunction with the City's financial advisors, PFM Financial Advisors LLC, and Tijerina Galvan Lawrence LLC, evaluate the City's financial position and its debt portfolio to identity opportunities to refund (refinance) and/or defease outstanding debt obligations to achieve net savings and/or free up capacity for future debt -funded projects. This strategy supports the City's initiative of being good stewards of taxpayers' money. The attached resolution authorizes the recommended cash defeasance further described below: Citv of Fort Worth. Texas. Combination Tax and Revenue Certificates of Obliaation. Series 2012 and General Pura_ ose Refundina and Improvement Bonds. Series 2013 Series 2012 was issued for an initial principal amount of $85,790,000.00 for the purpose of designing, constructing, and equipping a police/fire facility; purchasing fire equipment; constructing streets; constructing water, wastewater, and stormwater improvements; purchasing traffic and public safety signals; public art; and constructing a public safety telecommunications tower. Series 2012 was callable on or after March 1, 2022, at a price of par plus accrued interest to the redemption date. Series 2013 was issued for an initial principal amount of $37,130,000.00 for the purpose of constructing street and stormwater improvements and refinancing a portion of the City's debt for debt service savings. Series 2013 was callable on or after March 1, 2023, at a price of par plus accrued interest to the redemption date. The cash defeasance would be for the approximate amount of $24,750,000.00, which represents $20,230,000.00 of remaining principal of the Series 2012 Certificates maturing March 1, 2026 through March 1, 2028 and March 1, 2031 through March 1, 2032; $4,520,000.00 of remaining principal of the Series 2013 Bonds maturing March 1, 2026 through March 1, 2033; and accrued interest and transaction costs. Defeasance of the identified maturities will achieve projected net present value savings in the estimated amount of $339,105.65 or 1.37 percent. As a result of the cash defeasance, the general debt service fund will have four remaining maturities for the Series 2012 Certificates due March 1, 2025, March 1, 2029, March 1, 2030, and March 2031, and one remaining maturity outstanding for the Series 2013 Bonds due March 1, 2025. Adoption of this M&C will adjust appropriations in the total amount of $12,559,902.00, which includes $7,740,271.00 from use of fund balance and $4,819,631.00 reallocated from previously appropriated contribution to fund balance. Funding is available for appropriation in the available fund balance of the General Debt Service Fund above required reserve amounts. This new appropriation will be coupled with existing available appropriations in the Debt Service Fund to defease callable debt. If approved, defeasance of the identified maturities would occur on April 24, 2024. The action in this M&C will amend the Fiscal Year 2024 Adopted Budget as approved in connection with Ordinance 26453-09-2023, Section 3. Debt Service Funds, as listed on page 12. NOTE ON APPROPRIATIONS - The attached appropriation ordinance reflects the maximum additional appropriation amount for this defeasance. The structure accommodates variables in costs that are associated with the transaction date being a month away. To the extent numbers at the time of defeasance are less than those reflected in the ordinance, the available appropriation amount will be reduced as needed to reflect final figures to ensure appropriations do not exceed actuals. A Form 1295 is not required because: This M&C does not request approval of a contract with a business entity. FISCAL INFORMATION / CERTIFICATION: The Director of Finance certifies that upon adoption of the attached resolution and appropriation ordinance, funds for principal, accrued interest, and transaction costs will be available in the General Debt Service Fund, as appropriated, to legally defease the above referenced obligations. Submitted for Citv Manaaer's Office bv: Reginald Zeno 8517 Oriainatina Business Unit Head: Reginald Zeno 8517 Additional Information Contact: Anthony Rousseau 8338 Expedited