HomeMy WebLinkAboutOrdinance 13226ORDINANCE NO I ~~~~
FIFTH SUPPLEMENTAL ORDINANCE AUTHORIZING THE
ISSUANCE AND SALE OF CITY OF FORT WORTH, TEXAS
WATER AND SEWER SYSTEM REVENUE REFUNDING
AND Il1~IPROVEMENT BONDS, SERIES 1997
THE STATE OF TEXAS
COUNTIES OF TARItANT AND DENTON
CITY OF FORT WORTH
WHEREAS, the City of Fort Worth, Texas (the "City" or the "Issuer"), a "home-rule" city
operating under ahome-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 heretofore has established the City of Fort Worth, Texas Water and
Sewer System Revenue Finance Program for the purpose of providing a financing structure for
revenue supported indebtedness of the System; and
WHEREAS, said Program was established pursuant .to the terms of a "Master Ordinance
Establishing the City of Fort Worth, Texas Water and Sewer System Revenue Financing Program"
(the "Master Ordinance"); and
WHEREAS, unless otherwise defined herein, terms used herein shall have the meaning given
in the Master Ordinance; and
VVI~REAS, the Master Ordinance authorizes revenue supported indebtedness to be issued,
incurred or assumed pursuant to the terms of supplemental ordinances (any such ordinance being a
"Supplement"); and
WHEREAS, pursuant to the terms of the Master Ordinance, the City has adopted four
Supplements (designated as the "First Supplement", "Second Supplement", "Third Supplement" and
"Fourth Supplement", respectively, and the "Prior Supplements", collectively) pursuant to which (i)
the City of Fort Worth, Texas Water and Sewer System Revenue Refunding Bonds, Series 1991A
and Series 1991B, the City of Fort Worth, Texas Water and Sewer System Revenue Refunding
Bonds, Senes 1993, and the City of Fort Worth; Texas Water and Sewer System Revenue Refunding
and Improvement Bonds, Series 1996 (the "Previously Issued Parity Bonds") were issued, and (ii)
the City entered into two respective ISDA Master Agreements (referred to herein as the "Swap
Agreements"), one with Lehman Brothers Special Financing Inc., and the other with GBDP, L.P ,
for the purpose of enhancing the security for or providing for the payment of the principal of and
interest on the Previously Issued Panty Bonds by providing for the receipt of fixed rate payments
which were estimated to exceed the variable rate payments to be made by the City under the Swap
Agreements; and
WHEREAS, the Previously Issued Parity Bonds and the obligations of the City under the
Swap Agreements are secured by a pledge of a first lien on and pledge of the Pledged Revenues of
the System; and
WHEREAS, the Previously Issued Parity Bonds and the obligations of the City under the
Swap Agreements are referred to herein as the "Previously Issued Parity Obligations", and
WHF1tEAS, in addition to the Previously Issued Parity Obligations, the City has authorized
the issuance of up to $75,000,000 of its Water and Sewer System Commercial Paper Notes, Series
A (the "Commercial Paper Notes"), for the purpose of improving and extending the City's Water and
Sewer System (the "System"); and
WHEREAS, the City currently has outstanding $49,300,000 in principal amount of
Commercial Paper Notes; and
WI~REAS, the City deems it appropriate to issue the hereinafter authorized bonds (i) in the
amount of $15,700,000 for the purpose of extending and improving the System and (ii) in the amount
of $49,300,000 for the purpose of retiring the outstanding Commercial Paper Notes; and
WHEREAS, notice of intention to sell the bonds hereinafter authorized was published in the
Fort Worth Star-Telegram, a newspaper of general circulation published in the City, in the manner
provided by applicable law, on October 20, 1997 and October 27, 1997, and
WHEREAS, no petition has been filed by the time fixed for the adoption of this Ordinance
meeting the requirements of Article 2368a, V.A.T C.S., as amended, and Chapter 252, Texas Local
Governument Code, as amended, requesting that an election be held on the question of issuing the
bonds hereinafter authorized, thereby rendering such an election unnecessary; and
WHEREAS, the City Council has adopted this Fifth 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
Article 717k and Articles 1111 through 1118, inclusive, V.A.T C S., as amended, for the purposes
set forth above.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCII, OF THE CITY OF
FORT WORTH, TEXAS
SECTION 1 DEFINITIONS In addition to the definitions set forth m the preamble of this
Fifth Supplement, the terms used in this Fifth Supplement (except to the FORM OF BOND set forth
m Exhibit B to this Fifth Supplement) and not otherwise defined shall have the meanings given m the
Master Ordinance, the Prior Supplements or in Exhibit A to this Fifth Supplement.
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Section 2. BONDS AUTHORIZED That the "City of Fort Worth, Texas Water and Sewer
System Revenue Refunding and Improvement Bonds, Series 1997" are hereby authorized to be issued
in the aggregate principal amount of $65,000,000, for the following purposes, to-wit: (i) in the
amount of $15,700,000 for the purpose of extending and improving the System and (ii) in the amount
of $49,300,000 for the purpose of retiring the currently outstanding Commercial Paper Notes. The
Bonds shall be issued, shall be payabley 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), as
provided, in the FORM OF BOND in Exhibit B to this Fifth Supplement.
Section 3 DATE AND MATURITIES. That the Bonds shall be dated November 1, 1997,
shall be in the denomination of $5,000, or airy integral multiple thereof, shall be numbered
consecutively from one upward, and shall mature on February 15 in each of the years, and in the
amounts, respectively, unless redeemed as stated in the FORM OF BOND set forth in Exhibit B of
this Fifth Supplement, as set forth in the following schedule:
YEARS AMOUNTS($1 YEARS AMOUNTS($)
1999 1,135,000 2009 3,210,000
2000 2,135,000 2010 3,370,000
2001 2,225,000 2011 3,545,000
2002 2,325,000 2012 3,730,000
2003 2,430,000 2013 3,925,000
2004 2,540,000 2014 4,135,000
2005 2,655,000 2015 4,355,000
2006 2,780,000 2016 4,590,000
2007 2,915,000 2017 4,840,000
2008 3,055,000 2018 5,105,000
Section 4 RIGHT OF PRIOR REDEMPTION (a) That the Bonds are subject to optional
redemption prior to their scheduled maturities in the manner provided in the FORM OF BOND set
forth in Exhibit B to this Fifth Supplement.
(b) Notice of any redemption of Bonds shall be given in the following manner, to-wit, (i) a
written notice of such redemption 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, addressed
to each such owner at the address thereof shown on the Registration Books of the Paying
AgentlRegistrar 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 carves 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)
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above shall be the only notice actually required in connection. with or as a prerequisite to the
redemption of any Bonds. By the date f xed for any such redemption due provision shall be made by
the City with the Paying AgentlRegistrar 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
£uced for redemption. If such notice of redemption is given, and if due provision for such paymem
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 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 AgentlReg'rstrar out of the funds provided for such payment. The Paying
AgentlRegistrar 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 irrtegral multiple of $5,000 at the written request of the owner, and in an aggregate prin-
cipal 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 Fifth Supplement.
The maturities of Bonds to be called for redemption shall be detennined 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 AgentlRegistrar (provided that a portion of a Bond maybe 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 b0 calendar days (or such shorter period
as is acceptable to the Paying AgentlRegistrar) prior to such redemption.
(c) (i) In addition to the manner of providing notice of redemption of Bonds as set forth
above, the Paying AgentiRegistrar 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 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 AgentlRegistrar 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
Fifth Supplement, shall contain a description of the Bonds to be redeemed including the complete
name of the Bands, the senes, 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
AgentlRegistrar and the address at which the Bond maybe redeemed including a contact person and
telephone number
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(iii) All redemption payments made by the Paying Agent/Registrar to the registered owners
of the Bonds shall include a C`tJSIP number relating to each amount paid fo such registered owner
Section 5 INTEREST That the Bonds scheduled to mature during the years, respectively,
set forth below shall bear interest at the following rates per annum:
maturities 1999, 4,500%
maturities 2000, 5 000%
maturities 2001, 5 000%
maturities 2002, 5 000%
maturities 2003, 5 000%
maturities 2004, 5 500%
maturities 2005, 5.500%
maturities 2006, 5.500%
maturities 2007, 5.500%
maturities 2008, 5 500%
maturities 2009, 5.500%
maturities 2010, 5.500%
maturities 2011, 5 150%
maturities 2012, 5.200%
maturities 2013, 5.250%
maturities 2014, 5.300%
maturities 2015, 5.350%
maturities 2016, 5.375%
maturities 2017, 5.250%
maturities 2018, 5 000%
Said interest shall be payable to the owner in the manner provided and on the dates stated in the
FORM OF BOND set forth in Exhibit B to this Fifth Supplement.
Section 6. CHARACTERISTICS OF THE BONDS. (a) Registration. Transfer. Conversion
and Exchange: Authentication. The City shall keep or cause to be kept at the designated corporate
trust office in Dallas, Texas (the "Designated Trust Office") of Texas Commerce Bank National
Association (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/R.egistrar 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 m the Regis-
trationBooks 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 wasting 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 at the Designated Trust Office the Registration Books during regular business hours of the
Payuig 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 BOND set forth in Exhibit B to this Fifth
Supplement, the owner of each Bond requesting a conversion, transfer, exchange and delivery of such
Bond shall pay the Paying AgentlRegistra~'s standard or customary fees and charges for malung 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 m the manner provided
and with the effect stated in the in the FORM OF BOND set forth in Exhibit B to this Fifth
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Supplement. Each substitute Bond shall bear a letter and/or number to distinguish it fr_ om each other
Bond. An authorized representative of the Paying AgentlRegistrar 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 BOND set forth in Exhibit B to this Fifth 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 BOND set forth in Exhibit B to this Fifth 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 AgentlRegistrar shall provide for the printing, execution, and
delivery of the substitute Bonds in 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-b, 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 AgentlRegistrar, and, upon the execution of said Certificate, the converted and exchanged
Bond shall be valid, incontestable, and enforceable iri the same manner and with the same effect as
the Bonds which initially were issued and delivered pursuant to this Fifth 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 Fifth 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 inrterest 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,
~v) maybe 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 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 BOND set forth in Exhibit B to this Fifth
Supplement. The Bonds initially issued and delivered pursuant to this Fifth Supplement are not re-
quired 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 Fifth Supplement
the Paying AgentlRegistrar shall execute the "Paying Agent/Registrar's Authentication Certificate",
in the form set forth in said FORM OF BOND
(d} Substitute Pa}nn$ A eg nt/Reg~-strar The City covenants vv~th the owners of the Bonds that
at all tunes while the Bonds are Outstanding a competent and legally qualified entity shall act as and
perform the services of Paying AgentlRegistrar for the Bonds under this Fifth Supplement, and that
the Paying Agent/Registrar will be one entity Such entity maybe the City, to the extent permitted
by law, or a bank, trust company, financial institution, or other agency, as~ selected by the City The
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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 tune acting as Paying Agent/Registrar (or its successor by merger, acquisition, or other method)
should resign or otherwise cease to act as such, the City covenants .that promptly it will appoint a
competent and legally qualified entity to act as Paying Agent/Registraruader this Fifth 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 AgentlRegistrar designated and appointed by
the City Upon any change in the Paying Agerrt/Registrar, the City promptly will cause a written not-
ice thereof to be sent by the new Paying AgentlRegistrar 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 AgentlRegistrar
shall be deemed to have agreed to the provisions of this Fifth Supplement, and a certified copy of this
Fifth Supplement shall be delivered to each Paying AgentlRegistrar
Section 7 FORM OF BONDS (a) That the form of all Bonds, including the form of the
Paying Agent/R.egistrar's Certificate, the form of Assignment, and the form of the Comptrollers
Registration Certificate to be attached only to the Bonds initially issued and delivered pursuant to this
Fifth Supplement, shall be, respectively, substantially as set forth in Exhibit B, with such appropriate
variations, omissions, or insertions as are permitted or required by this Fifth 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 ESTABLISHIVIENT 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 incwred. This Fifth Supplement provides for the authorization, issuance, sale, delivery, form,
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 extern modified and supplemented hereby, and the Bonds
are hereby declazed to be Parity Obligations under 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 Sernce 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 Revenues; 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
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__ 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 F[JND ACCOUNTS. That in connection with the Bonds, the
City need not establish any special accounts within the Debt Service Fund.
Section 11 RESERVE FUND That deposits to the credit of the Reserve Fund shall be
made is the manner described in Section 13(b) of this Fifth Supplement.
Section 12. INVES'TMEN'TS. That money in the Reserve Fund created under this Fifth
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 10th day of the
following month, commencing during the months and in the order of priorty 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 10th day thereof, as will be sufficient, together with other amounts,
if any, in the Debt Service Fund available for such purpose, to pay the interest scheduled to
come due on the Bonds on the next succeeding interest payment date; and
(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 ofthe Bonds, or (ri) the month in which the Bonds are delivered,
or the month thereafter if delivery is made after the 10th day thereof, as will be sufficient,
together vv~th other amounts, if any, in the Debt Sernce Fund available for such purpose, to
pay the principal scheduled to mature on the Bonds on the next succeeding principal payment
date.
(b) Reserve Fund. To the credit of the Reserve Fund, such amounts, deposited in
approximately equal monthly installments, commencing dunng the month in which the Bonds are
delivered, or the month thereafter ~f delivery is made after the 10th day thereof, equal to not less than
1/24 of the Required Reserve Amount, until such tune as such amounts together with other amounts,
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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 theq 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 fmm the next available Pledged
Revenues or from any other sources available for such purpose, in monthly installments of not less
than 1/12 of the Required Reserve Amount, in the manner provided in the Master Ordinance.
Reimbursements to the provider, if any, of a 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 maybe, of the amount of the Credit Facility
Section 14 PAYNIEN'T 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 Reserve Fund, if necessary) monies sufficient to pay such
interest on and such principal amount of the Bonds, as shall become due on such dates, respectively,
at maturity or by redemption prior to maturity The Paying Agent/Registrar shall destroy all paid
Bonds and fiunish 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 percent is used fora "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
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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
induectly, 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 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 1 148-1(b) of the Treasury Regulations, and
(3) amounts deposited in any reasonably required reserve or replacement fund
to the extent such amounts do not exceexi 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); and
(h) to pay to the United States of America at least once during each five-year
period (beginning on the date of delivery of the Bonds) an amount that is at least equal to 90
percent of the "Excess Earnings", within the meaning of section 148(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.
For purposes of the foregoing clauses (a) and (b} above, the Issuer understands that the term
"proceeds" includes "disposition proceeds" as defined m the Treasury Regulations and, in the case
of a refunding bond, transferred proceeds (if any) and 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 failure to comply, in the opinion of nationally-recognized bond counsel, will not
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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
a additional requiremenrts to the extent necessary, in the opinion ofnationally-recognized bond counsel,
to preserve the exemption from federal income taxation of interest oa the Bonds under section 103
of the Code. In furtherance of the foregoing, the Mayor, the City Manager,- any Assistant City
Manager, and the Director of Fiscal Services may execute any certificates or other reports required
by the Code and to make such elections, on behalf of the City, which maybe permitted by the Code
as are consistent with the purpose for the issuance of the Bonds. In order to facilitate compliance
with the above clause (h), a "Rebate Fund" is hereby established by the City for the sole benefit of the
United States of America, and such Rebate Fund shall not be subject to the claim of any other person,
including without limitation the registered owners of the Bonds. The Rebate Fund is established for
the additional purpose of compliance with section 148 of the Code..
Section 16. AMENDMENT OF FIFTH SUPPL~:MENT (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 Fifth 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 amend-
ment of the terms and conditions in this Fifth 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 ot; 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.
(b) That if at any time the City shall desire to amend the Fifth 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 AgentlRegistrar for inspection by all owners of the Bonds. Such
publication is not required, however, if notice in wasting 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
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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 Fifth Supplement shall be deemed to be amended in accordance with such amendment, and the
respective rights, duties and obligations under this Fifth 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 arty consent given by the owners of a Bond pursuant to the provisions of this Section
shall be irrevocable for a 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 Agent/Registrar 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 Fifth 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 Fifth Supplement
contained, other covenants and agreements thereafter to be observed, grant additional rights
or remedies to the owners of the Bonds or to surrender, 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 Fifth Supplement, or
in regard to clarifying matters or questions arising under this Fifth Supplement, as are neces-
sary or desirable and not contrary to or inconsistent with this Fifth 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 Fifth 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 Fifth Supplement as may be required, m the
op~ruon of Bond Counsel, to ensure compliance vv~th sectrons 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 m order to allow the owners of the Bonds to thereafter avail themselves of a book-
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entry system for.payments, transfers and other matters relating_toae Bonds, which changes,.
modifications or amendments are not contrary to or inconsistent with other provisions of this
Fifth 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 amendmern maybe 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 implemernation 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 AgenttRegistrar, 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, 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
o~ redemption premium, if any, or interest on the Bond, the City may authorize the payment of the
same (without surrender thereof except in the case of a damaged or mutilated Bond) instead of
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issuing a replacement Bond, provided security or indemnity is furnished. as above provided yin 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, stoleq or destroyed Bond shall be found at any time, or be enforceable by anyone, and shall be
entitled to all the benefits of this Fifth Supplement equally and proportionately with anY' and all other
Bonds duly issued under this Fifth Supplement.
(e) In accordance with Section b of Article 717k-6, Texas Revised Civil Statutes, as
amended, this Section of this Fifth 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 'unposed
upon the Paying AgentlRegistrar, 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 Fifth Supplement
for Bonds issued in exchange for other Bonds.
Section 18 CONTINUING DISCLOSURE UNDERTAKING. (a) Annual Reports. (i)
The City shall provide annually to each NRMSIR and any SID, within six months after the end of
each Fiscal Year ending in or alter 1997, financial information and operating data with respect to the
City of the general type included in the final Official Statement authorized by Section 25 of this Fifth
Supplement, being the information described in Exhibit C hereto. Any financial statements so to be
provided shall be (1) prepared in accordance with the accounting principles described in Exhibit C
hereto, or such other accounting principles as the City maybe required to employ from time to time
pursuant to state law or regulation, and (2) audited, if the City commissions an audit of such
statemenrts and the audit is completed within the period during which they must be provided. If the
audit of such financial statements is not complete within such period, then the City shall provide
unaudited financial statements within such period and shall provide audited financial statements for
the applicable fiscal year to each NRMSIR and any SID, when. and if the audit report on such
statements becomes available.
(ii) ffthe City changes its Fiscal Year, it will notify each NRMSIR and any SID of the change
(and of the date of the new Fiscal Yearend) prior to the next date by which the City otherwise would
be required to provide financial information and operating data pursuant to this Section. The financial
information and operating data to be provided pursuant to this Section may be set forth in full in one
or more documents or may be included by specific reference to any document (including an official
statement or other offering document, if it is available from the MSRB) that theretofore has been
provided to each NRMSIR and any SID or filed with the SEC
(b) Matenal .Event Notices. The City shall notify any SID and either each NRMSIR or the
MSRB, in a timely manner, of any of the following events with respect to the Bonds, if such event
is matenal within the meaning of the federal securities laws
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1 Principal and interest payment delinquencies; _
2. Non-payment related~defaults; u~ ~~
3 Unscheduled draws on debt service reserves reflecting financial difficulties;
4 Unscheduled draws on credit enhancements reflecting financial difficulties;
5 Substitution of credit or liquidity providers, or their failure to perform;
6. Advease tax opinions or events affecting the tax-exempt status of the Bonds;
7 Modifications to rights of holders of the Bonds;
8. Bond calls;
9 Defeasances;
10 Releaser substitution, or sale of property se<auing repayment of the Bonds; and
11 Rating changes.
The City shall notify any SID and either each NRMSIR or the MSRB, in a timely manner, of any
failure by the City to provide financial information or operating data in accordance with subsection
(a) of this Section by the time required by such subsection.
(c) Limitations Disclaimers. and Amendments. (i) The City shall be obligated to observe
and perform the covenants specified in this Section for so long as, but only for so long as, the City
remains an "obligated person" with respect to the Bonds within the meaning of the Rule, except that
the City in any event will give notice of any deposit made in accordance with this Fifth Supplement
or applicable law that causes Bonds no longer to be outstanding.
(ii) The provisions of this Section are for the sole benefit of the Holders and beneficial owners
of the Bonds, and nothing in this Section,, express or implied, shall give any benefit or any legal or
equitable right, remedy, or claim hereunder to any other person. The City undertakes to provide only
the financial information, operating data, financial statements, and notices which it has expressly
agreed to provide pursuant to this Section and does not hereby undertake to provide airy other
information that maybe relevant or material to a complete presentation of the City's financial results,
condition, or prospects or to update any information provided in accordance with this Section or
otherwise, except as expressly provided herein. The City does not make any representation or
warranty concerning such information or its usefulness to a decision to invest ur or sell Bonds at any
future date.
(iii) UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER
OR BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR
TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY
THE CITY,. WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY
COVENANT SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND REMEDY OF ANY
SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH
SHALL BE LIlvIITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE.
(iv) No default by the City in observing or performing its obligations under this Section shall
comprise a breach of or default under this Fifth Supplement for purposes of any other provision of
this Fifth Supplement. Nothing in this Section is intended or shall act to disclaim, waive, or otherwise
lirrut the duties of the City under federal and state securities laws.
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(v) The provisions of this Section maybe amended by the City from time to time to adapt to
changed circumstances that arise from a change in legal requirements, a change in law, or a change
in the identity, nature, status, or type of operations of the City, but only if (1) the provisions of this
Section,- as so amended, would have permitted an underwriter to purchase or sell Bonds in the
primary offering of the Bonds in compliance with the Rule, taking into account any amendments or
ititetpretations of the Rule since such offering as well as such changed circumstances and (2) either
(a) the Holders of a majority in aggregate principal amount (or any greater amount required by any
other provision of this Fifth Supplement that authorizes such an amendment) of the outstanding
Bonds consent to such amendment or (b) a person that is unaffiliated with the City (such as nationally
r+ecogaized bond counsel) determines that such amendment will not materially impair the interest of
the holders and beneficial owners of the Bonds. If the City so amends the provisions of this Section,
it shall include with any amended financial information or operating data next provided in accordance
with subsection (a) of this Section an explanation, in narrative form, of the reason for the amendment
and of the impact of any change in the type of financial information or operating data so provided.
Section 19 FIFTH 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 Fifth 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 Fifth Supplement by the City and the covenants and
agreements set forth in this Fifth 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-Fifth Supplement.
Section 20 SEVERABILTTY OF IlWALID 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 BOND set forth in Exhibit B to this Fifth Supplement,
whenever under the terms of this Fifth 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 maybe, on the next succeeding Business Day with the same force and effect as if made on the
date of performance or payment.
Section 22. LIlvIITATION OF BENEFITS WITH RESPECT TO THE FIFTH
SUPPLEMENT That with the exception of the rights or benefits herein expressly conferred, nothing
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expressed or contained herein or implied from the provisions of this Fifth Supplement or the Bonds
is intended or should be construed to confer upon or give to any person other than the City, the
Holders, and the Paying AgentlRegistrar, any legal or equitable right, remedy, or claim under or by
reason of or in respect to this Fifth Supplement or aay covenant, conditioq stipulation, promise,
agreement, or provision herein contained. This Fifth Supplement and all of the covenants, conditions,
stipulationsy promises, ageeanentsy and provisions hereof are intended to be and shall be for and inure
to the sole aad exclusive beneSt 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 aU such acts and things and to execute,
acknowledge, and deliver is the name and under the seal and on behalf of the City all such
instrurrrents, whether or not herein mentioned, as maybe necessary or desirable in order to carry out
the terms and provisions of this Fifth 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 hereoi!~ or the. Escrow Agreement described m Section 27 hereof
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 nevertheless be valid and sufficient for all purposes the
same as if he or she had remained in office until such delivery
Section 24; APPROVAL AND REGISTRATION OF BONDS. That the City Manager 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
conSrtned. One Bond is 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 sate of the Bonds to the
Underwriters, in substantially the form attached to this Fifth Supplement, is hereby accepted,
approved and authorized to be delivered in executed form to said Underwriters.
(c) That the offering documents prepared in connection with the sale of the Bonds, rn
substantially the form. attached to this Fifth Supplement, are hereby accepted, approved and
authorized to be delivered in executed form to the Underwriters. The use of the "Preliminary Officrat
Statement" prepared in connection wrth the sale of the Bonds is hereby ratified.
•I7-
Section 26. 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
Tnist 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 Fifth Supplement shall be delivered to
and registered in the name of CEDE 8c 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 of CEDE & CO., the Paying AgentlRegistrar 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 abook-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
delivered Bonds is duly filed with the Paying Agent/Registrar with proper request for transfer and
substitution, as provided for in this Fifth Supplement, substitute Bonds will be duly delivered as
provided in this Fifth Supplement, and there will be no assurance or representation that any book-
entry system will be maintained for such Bonds. The City heretofore has executed the "DTC Master
Letter of Representations" in the form provided by DTC to effect. the establishment of the foregoing
book-entry system.
Section 27 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, an "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 Commercial Paper Notes being retired with~a portion of the proceeds from the sale of the
Bonds, the form of said Escrow Agreement being in substantially the form attached to this Fifth
Supplement.
Section 28 ALLOCATION OF, AND LIlvIITATION ON, EXPENDITURES FOR THE
PROJECT That the City covenants to account for on its books and records the expenditure of
proceeds from the sale of the Bonds and any investment earnings thereon to be used for the
improvement and extension of the System (referred to herein and Section 29 hereof as a "Project")
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by allocating proceeds to expeaditu_res within 18 months of the later of the date that (a) the
expenditure on a Project is made or (b) each such Project is completed. The foregoing
notwithstanding, the City shall not expend such proceeds or investment earnings more than 60 days
after the later of (a) the fifth anniversary of the date of delivery of the Bonds or (b) the date the Bonds
are retired, unless the City obtains an opinion of nationally-recognized bond counsel substantially to
the effect that such expenditure will not adversely affect the tax-exempt status of the Bonds. For
purposes of this Section, the City shall not be obligated to comply with this covenant if it obtains an
opinion of nationally-recognized bond counsel to the effect that such failure to comply will not
adversely affect the excludability for federal income tax purposes from gross income of the interest.
Section 29 DISPOSITION OF PROJECT That the City covenants that the property
constituting a Project will not be sold or otherwise disposed in a transaction resulting in the receipt
by the City of cash or other compensation, unless. the City obtains an opinion ofnationally-recognized
bond counsel substantially to the effect that such sale or other disposition will not adversely affect
the tax-exempt status of the Bonds. For purposes of this Section, the portion of the property
comprising personal property and disposed of in the ordinary course of business shall not be treated
as a transaction resulting in the receipt of cash or other compensation. For purposes of this Section,
the Issuer shall not be obligated to comply with this covenant if it obtains an opinion of nationally-
recognized bond counsel to the effect that such failure- to comply will not adversely affect the
excludability for federal income tax purposes from gross income of the interest.
Section 30 DELIVERY OF DOCUMENTS TO SWAP PROVIDERS AND SURETY
BOND PROVIDER. That the Designated Financial'Officer is hereby directed to send to the Swap
Providers copies of this Fifth Supplemenrt and the final Official Statement prepared in connection with
the sale of the Bonds promptly after the date of adoption of this Fifth Supplement.
Section 31 PREAMBLE. That the preamble to this Fifth Supplement is hereby
incorporated by reference, and is to be considered a part of the operative text of this Fifth
Supplement.
Section 32. IlVIlVIEDIATE EFFECT That this Fifth 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.
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SIGNED AND SEALED THIS 11TH DAY OF NOVEMBER, 1997
Mayor,
City of Fort Worth, Texas
City Secretary.
APPROVED AS TO FORM AND LEGALITY
City Attorney
(SEAL)
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EXffiBIT A
That, as used in this Fifth Supplement, the following terms shall have the meanings set forth
below, unless the text hereof specifically indicates otherwise:
"Bond Purchase Agreement" means the Bond Purchase Agreement, dated November 11,
1997, by and among the City and the Underwriters.
"Bonds" means the Series 1997 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 mist office of the Paying Agent/Registrar
is located are authorized by law or executive order to close.
"Commercial Paper Notes" shall have the meaning given said term in the preamble to the Fifth,
Supplement.
"Fifth Supplement" means the ordinance authorizing the issuance of the Bonds.
"First Supplement" means the ordinance authorizing the issuance of the Series 1991 A Bonds
and the Series 1991B Bonds.
"Fourth Supplement" means the ordinance authorizing the execution and delivery of the Swap
Agreements.
"GBDP Agreement" means the "ISDA Master Agreement" between the City of Fort Worth
and GBDP, L.P., as maybe novated by the Termination and Replacement Agreement, executed and
delivered by the City under authority of the Fourth Supplement.
"Lehman Agreement" means the "ISDA Master Agreement" between the City of Fort Worth
and Lehman Brothers Special Financing Inc., executed and delivered by the City under authority of
the Fourth 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
"MSRB" means the Municipal Secunttes Rulemaldng Board.
"NRMSIR" means each person whom the SEC or its staff has determined to be a nationally
recognized municipal securities information repository within the meaning of the Rule from time to
time.
"Paying Agent/Registrar" means the financial institution specified in Section 6(a) of the Fifth
Supplement.
A-1
"Previously Issued Parity Bonds" means the Series 1991A Bonds, the Series 1991B Bonds,
the Series 1993 Bonds and the Series 1996 Bonds.
"Previously Lssued Parity Obligations" shall include (i) the Previously Issued Parity Bonds and
(ii) the obligations incurred by the City pursuant to the terms of the Swap Agreements.
"Registration Books" shall have the meaning given said term in Section 6(a) of the Fifth
Supplement.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
"Second Supplement" means the ordinance authoriiir-g the issuance of the Series 1993 Bonds.
"Series 1991A Bonds" means the City of Fort Worth, Texas Water and Sewer System
Revenue Refunding Bonds, Series 1991A, authorized by the First Supplement.
"Series 1991B Bonds" means the City of Fort Worth, Texas Water and Sewer System
Revenue Refunding Bonds, Series 1991B, authorized by the First Supplement.
"Series 1993 Bonds" means the City of Fort Worth, Texas Water and Sewer System Revenue
Refunding Bonds, Series 1993, authorized by the Second Supplement.
"Series 1996 Bonds" means the City of Fort Worth, Texas Water and Sewer System Revenue
Refunding and Improvement fonds, Series 1996, authorized by the Third Supplement.
"Series 1997 Bonds" means the City of Fort Worth, Texas Water and Sewer System Revenue
Refunding and Improvement Bonds, Series 1997, authorized by the Fifth Supplement.
"SID" means any person designated by the State of Texas or an authorized departmerrt,
officer, or agency thereof as, and determined by the SEC or its staff to be, a state information
depository within the meaning of the Rule from time to time.
"Swap Agreements" means, collectively, the GBDP Agreement and the Lehman Agreement.
"Swap Providers" means GBDP, L.P ,Lehman Brothers Special Financing Inc., or their
successors and assigns under the terms of the GBDP Agreement and the Lehman Agreement,
respectively
"Termination and Replacement Agreement" means the Termination and Replacement
Agreement, between the City and General Re Financial Products Corporation, executed and delivered
by the City in respect to the GBDP Agreement, under authority of the Fourth Supplement.
"Thud Supplement" means the ordinance authonzing the issuance of the Senes 1996 Bonds.
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"Underwriters" means the investment banking Srms that contract to purchase the Bonds
pursuant to the terms of the Bond Purchase Agreement.
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EXHIBIT B
NO
FORM OF BOND'
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTIES OF TA1tRANT AND DENTON
CITY OF FORT WORTH, TEXAS
WATER AND SEWER SYSTEM REVENUE REFUNDING
AND IlVIPROVEMENT BOND, SERIES 1997
MATURITY DATE INTEREST RATE DATED DATE CUSIP
NOVEMBER 1, 1997
ON THE MATURITY DATE SPECIFIED ABOVE, THE CITY OF FORT WORTH, IN
TA-RRANT 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 dated date specified above, on August 15, 1998 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, 1998, such interest is payable semiannually on each February 1 S 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 rts redemption prior to maturity, at the designated corporate trust office in
Dallas, Texas (the "Designated Trust Office"), of Texas Commerce Bank National Association, which
is the "Paying AgentlRegistraz" 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/Reg~straz on, and payable
solely from, funds of the Issuer required by the ordinance authonzing 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 AgentlRegistrar by United States mail,
first-class postage prepaid, on each such interest payment date, to the registered owner hereof, at its
address as rt appeared on the last day of the month next preceding each such date (the "Record Date")
on the Registration Books kept by the Paying AgentlRegistraz, as hereinafter described. Any accrued
interest due at matunty or upon the redemption of this Bond pnor to matunty as provided herein shall
be paid to the registered owner upon presentation and surrender of this Bond for redemption and
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payment at the Designated 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.
IN THE EVENT of a noo-payment of interest on a scheduled payment date, and for 30 days
thereafter, a new record date for such interest payment (a "Special Record Date") will be established
by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received
from the Issuer Notice of the Special Record Date and of the scheduled payment date of the past
due interest ("Special Payment Date", which shall be 15 days after the Special Record Date) shall be
sent at least five business days prior to the Special Record Date by United States mail, first class
postage prepaid, to the address of each registered owner appearing on the registration books of the
Paying Agent/Registrar at the close of business on the last business day next preceding the date of
mailing of such notice.
IF THE DATE for the payment of the principal of or urterest on this Bond shall be a Saturday,
Sunday, a legal holiday, or a day on which banking institutions in the City where the Designated Trust
Office of the Paying AgentlRegistrar 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.
Notwithstanding the foregoing, during any period in which ownership of the Bands is determined
only by a book entry at a securities depository for the Bonds, any payment to the. securities
depository, or its nominee or registered assigns, shall be made in accordance with existing
arrangements between the Board and the securities depository
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 dated date specified
above, aggregating $65,000,000 (herein sometimes called the "Bonds") issued for the following
purposes, to-wit: (i) in the amount of $15,700,000 for the purpose of extending and improving the
Issuer's Water and Sewer System and (ii) in the amount of $49,300,000 for the purpose of retiring
the Issuer's currently outstanding Water and Sewer System Commercial Paper Notes, Series A.
THE OUTSTANDING BONDS maturing on and after February 15, 2008 may be redeemed
prior to their scheduled maturities, at the option of the Issuer, in whole, or m part on February 15,
2007, 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,
provrded, that during any period m which ownership of the Bonds is determined only by a book entry
at a securities depository for the Bonds, if fewer than all of the Bonds of the same maturity and
bearing the same interest rate are to be redeemed, the particular Bonds of such maturity and bearing
such interest rate shall be selected in accordance with the arrangements between the Issuer and the
securities depository
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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 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 Agerrt/Registrar and (ii) a notice of such redemption shall be published one time, at least
30 days prior to the date fixed for such redemptioq 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 arty 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/R.egistrarfoi 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. ff such notice of redemption is giveq 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 redemptioq 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 ofthis 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 cancellatioq 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 maybe 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 assignee 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 cancellatioq 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 at the Designated Trust Office,
together with proper instruments of assignmenrt, in form and with guarantee of signatures satisfactory
to the Paying AgentlRegistrar, evidencing 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
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any such portion or portions hereof is or are to be registered. The form of Assignment printed or
endorsed on this Bond maybe 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 r~:gistered owner. The one requesting such conversion and exchange
shall pay the PayingAgent/Registrar's reasonable standard or customary fees and charges for convert-
ing 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, comrersion or exchange, as a condition precedent to the exercise of such privilege. The fore-
going 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 AgentlRegistrar shall not be required (i) to
make any such transfer, 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 34 calendar days; provided,
however, such limitation of transfer shall not be applicable to an exchange by the regrstered owner
of an unredeemed balance of a Bond called for redemption in part.
IN THE EVENT any Paying Agent/Registrarfnr 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 substan-
tially 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.
WHENEVER the beneficial ownership of this Bond is determined by a book entry at a
securities depository for the Bonds, the foregoing requirements of holding, delivering or transferring
this Bond shall be modified to require the appropriate person or entity to meet the requirements of
the securities depository as to registering or transfemng the book entry to produce the same effect.
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 ofl3cral 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. The Issuer has reserved the nght, subject to
the restrictions stated, and adopted by reference, in the Master Ordinance, to issue additional parity
revenue obligations which also maybe made payable from, and secured by a first lien on and pledge
of, the aforesard Pledged Revenues. For a more complete description and rdentification of the
revenues and funds pledged to the payment of the Bonds, and other obligations of the Issuer secured
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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.
TT 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 or the Mayor Pro-Tem of said Issuer, attested by the
unpnnted 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
By
Mayor (Pro-Tem)
ATTEST
City Secretary (SEAL)
APPROVED AS TO FORM AND LEGALITY
City Attorney
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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
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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 vv~thm Bond and all nghts thereunder, and hereby
irrevocably constitutes and appoints
attorney to register the transfer of the within Bond on the
books kept for registration thereoiy with full power of
substitution in the prerruses.
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 signature(s) 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
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TT~E STATE OF TEXAS
COUNTIES OF TA,R1tANT AND DENTON
CITY OF FORT WORTH
I, Alice Church, City Secretary of the City of Fort Worth, in the State of Texas, do hereby
certify that I have compared the attached and foregoing excerpt from the minutes of the regular,
open, public meeting of the City Council of the City of Fort Worth, Texas held on November 11,
1997, and of Ordinance No which was duly passed at said meeting, and that said copy is
a true and correct copy of said excerpt and the whole of said ordinance. Said meeting was open to
the public, and public notice of the time, place, and purpose of said meeting was given, all as required
by Chapter 551, Texas Government Code, as amended.
In testimony whereof, I have set my hand and have hereunto affixed the seal of said City of
Fort Worth, this 11th day of November, 1997
City Secretary of the
City of Fort Worth, Texas
(SEAL)