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Ordinance 1993-40 ORDINANCE NO. tj<lr -t(O AN ORDINANCE authorizing the issuance of "CITY OF WYLIE, TEXAS, TAX AND WATERWORKS AND SEWER SYSTEM SURPLUS REVENUE REFUNDING BONDS, SERIES 1993"; specifying the terms and features of said bonds; providing for the payment of said bonds by the levy of an ad valorem tax upon all taxable property within the City and a pledge of the net revenues derived from the operation of the City's Waterworks and Sewer System; and resolving other matters incident and relating to the issuance, payment, security, sale and delivery of said bonds, including the approval and execution of a Paying Agent/Registrar Agreement, a Purchase Contract and a Special Escrow Agreement and the approval and distribution of an Official Statement pertaining thereto; and providing an effective date. WHEREAS, the City Council of the City of Wylie, Texas (the "City") has heretofore issued, sold, and delivered, and there is currently outstanding, obligations totalling in principal amount $5,165,000 (collectively, the "Refunded Obligations") of the following issues or series, to wit: (1) City of wylie, Texas, Waterworks and Sewer System Revenue Bonds, Series 1971, dated March 1, 1971, maturing on June 1 in each of the years 1994 through 1996, and aggregating in principal amount $ 80,000 (2) City of Wylie, Texas, Waterworks and Sewer System Revenue Bonds, Series 1980, dated March 1, 1980, maturing on June 1 in each of the years 1997 through 2005, and aggregating in principal amount $ 390,000 (3) City of Wylie, Texas, Waterworks and Sewer System Revenue Bonds, Series 1986, dated July 1, 1986, maturing on June 1 in each of the years 1994 through 2006, and aggregating in principal amount $ 130,000 (4) City of wylie, Texas, General Obligation Bonds, Series 1986, dated August 15, 1986, maturing on February 15 in each of the years 1997 through 2006, and aggregating in principal amount $1,280,000 0108934 (5) City of Wylie, Texas, Tax and Waterworks and Sewer system Limited Pledge Revenue Certificates of Obligation, Series 1988, dated May 15, 1988, maturing on February 15 in each of the years 1999 through 2008, and aggregating in principal amount $ 910,000 (6) City of Wylie, Texas, Tax and Waterworks and Sewer System Limited Pledge Revenue Certificates of Obligation, Series 1990, dated February 15, 1990, maturing on February 15 in each of the years 2001 through 2010, and aggregating in principal amount $2,375,000 WHEREAS, pursuant to the provisions of Article 717k, V.A.T.C.S., as amended, the City Council is authorized to issue refunding bonds and deposit the proceeds of sale thereof directly with the place of payment for the Refunded Obligations, and such deposit, when made in accordance with said statute, shall constitute the making of firm banking and financial arrangements for the discharge and final payment of the Refunded obligations; and WHEREAS, the City council hereby finds and determines refunding bonds should be issued and sold at this time to refund the Refunded Obligations, and such refunding will result in gross debt service savings on such indebtedness of approximately $580,977.62 and present value savings of approximately $368,728.33; now, therefore, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF WYLIE, TEXAS: SECTION 1: Authorization. Designation. PrinciDal Amount. PurDose. Refunding bonds of the City shall be and are hereby authorized to be issued in the aggregate principal amount of $5,890,000 to be designated and bear the title "CITY OF WYLIE, TEXAS, TAX AND WATERWORKS AND SEWER SYSTEM SURPLUS REVENUE REFUNDING BONDS, SERIES 1993" (hereinafter referred to as the "BondS"), for the purpose of refunding certain outstanding obligations of the City (identified in the preamble hereof as the "Refunded Obligations") and paying costs of iSSiuance, in conformity with the constitution and laws of the State of Texas, including Article 717k, V.A.T..C.S., as amended. SECTION 2: Full v Reaistered Obliaations - Bond Date - Authorized Denominations - Stated Maturities - Interest Rates. The Bonds shall be issued as fully registered obligations only, shall be dated August 1, 1993 (the "Bond Date"), shall be in denominations of $5,000 or any integral multiple (within a stated 0108934 -2- Maturity, except for the Initial Bond authorized in section 8 hereof) thereof, and shall become due and payable on February 15 in each of the years and in principal amounts (the "Stated Maturities") and bear interest at the rate(s) per annum in accordance with the following schedule: YEAR OF PRINCIPAL INTEREST MATURITY INSTALLMENTS RATE 1994 $135,000 2.70% 1995 115,000 3.10% 1996 120,000 3.40% 1997 210,000 3.70% 1998 225,000 3.90% 1999 285,000 4.00% 2000 300,000 4.10% 2001 485,000 4.25% 2002 500,000 4.40% 2003 530,000 4.60% 2004 540,000 4.80% 2005 580,000 5.00% 2006 555,000 5.10% 2007 360,000 5.20% 2008 390,000 5.30% 2009 270,000 5.40% 2010 290,000 5.40% The Bonds shall bear interest on the unpaid principal amounts from the Bond Date at the rate(s) per annum shown above in this Section, and such interest (calculated on the basis of a 360-day year of twelve 30-day months) shall be payable on February 15 and August 15 in each year, commencing February 15, 1994. SECTION 3: Terms of Payment - pavina Aaent/Reaistrar. The principal of, premium, if any, and the interest on the Bonds, due and payable by reason of maturity, redemption or otherwise, shall be payable only to the registered owners or holders of the Bonds (hereinafter called the "Holders") appearing on the registration and transfer books maintained by the Paying Agent/Registrar and the payment thereof shall be in any coin or currency of the United States of America, which at the time of payment is legal tender for the payment of public and private debts, and shall be without exchange or collection charges to the Holders. The selection and appointment of Ameritrust Texas National Association to serve as Paying Agent/Registrar for the Bonds is hereby approved and confirmed. Books and records relating to the registration, payment, transfer and exchange of the Bonds (the "security Register") shall at all times be kept and maintained on behalf of the City by the Paying Agent/Registrar, as provided 0108934 -3- herein and in accordance with the terms and provisions of a "paying Agent/ Registrar Agreement", substantially in the form attached hereto as Exhibit A and such reasonable rules and regulations as the Paying Agent/Registrar and the City may prescribe. The Mayor or Mayor Pro Tem and city Secretary are authorized to execute and deliver such Agreement in connection with the delivery of the Bonds. The city covenants to maintain and provide a Paying Agent/Registrar at all times until the Bonds are paid and discharged, and any successor Paying Agent/Registrar shall be a bank, trust company, financial institution or other entity qualified and authorized to serve in such capacity and perform the duties and services of Paying Agent/Registrar. Upon any change in the Paying Agent/Registrar for the Bonds, the City agrees to promptly cause a written notice thereof to be sent to each Holder by united States Mail, first class postage prepaid, which notice shall also give the address of the new Paying Agent/Registrar. Principal of and premium, if any, on the Bonds shall be payable at the Stated Maturities or the redemption thereof, only upon presentation and surrender of the Bonds to the Paying Agent/Registrar at its principal offices in Dallas, Texas (the "Designated PaYment/Transfer Office"). Interest on the Bonds shall be paid to the Holders whose name appears in the Security Register at the close of business on the Record Date (the last business day of the month next preceding each interest paYment date) and shall be paid by the Paying Agent/Registrar (i) by check sent united States Mail, first class postage prepaid, to the address of the Holder recorded in the Security Register or (ii) by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the Holder. If the date for the paYment of the principal of or interest on the Bonds shall be a Saturday, Sunday, a legal holiday, or a day when banking institutions in the City where the Designated PaYment/Transfer Office of the Paying Agent/Registrar is located are authorized by law or executive order to close, then the date for such paYment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day when 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. In the event of a nonpaYment of interest on a scheduled paYment date, and for thirty (30) days thereafter, a new record date for such interest paYment (a "special Record Date") will be established by the Paying Agent/Registrar, if and when funds for the paYment of such interest have been received from the city. Notice of the Special Record Date and of the scheduled paYment date of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least five (5) business days prior to the Special Record Date by United States Mail, first class postage prepaid, to the address of each Holder appearing on the Security 0108934 -4- Register at the close of business on the last business day next preceding the date of mailing of such notice. SECTION 4: RedemDtion. (a) oDtional RedemDtion. The Bonds having Stated Maturities on and after February 15, 2003, shall be subject to redemption prior to maturity, at the option of the City, in whole or in part in principal amounts of $5,000 or any integral multiple thereof (and if within a Stated Maturity by lot by the Paying Agent/Registrar), on February 15, 2002 or on any date thereafter at the redemption price of par plus accrued interest to the date of redemption. . (b) Exercise of RedemDtion ODtion. At least forty-five (45) days prior to a redemption date for the Bonds (unless a shorter notification period shall be satisfactory to the Paying Agent/Registrar), the City shall notify the Paying Agent/Registrar of the decision to redeem Bonds, the principal amount of each Stated Maturity to be redeemed, and the date of redemption therefor. The decision of the City to exercise the right to redeem Bonds shall be entered in the minutes of the governing body of the City. (c) Selection of Bonds for RedemDtion. If less than all Outstanding Bonds of the same Stated Maturity are to be redeemed on a redemption date, the Paying Agent/Registrar shall treat such Bonds as representing the number of Bonds outstanding which is obtained by dividing the principal amount of such Bonds by $5,000 and shall select the Bonds to be redeemed within such stated Maturity by lot. (d) Notice of RedemDtion. Not less than thirty (30) days prior to a redemption date for the Bonds, a notice of redemption shall be sent by united States Mail, first class postage prepaid, in the name of the City and at the City's expense, to each Holder of a Bond to be redeemed in whole or in part at the address of the Holder appearing on the security Register at the close of business on the business day next preceding the date of mailing such no+-. :-:e, and any notice of redemption so mailed shall be conclu ly presumed to have been duly given irrespective of whether ree,,, - led by the Ho;J..der. All notices of redemption shall (i) specify the date of redemption for the Bonds, (ii) identify the Bonds to be redeemed and, in the case of a portion of the principal amount to be redeemed, the principal amount thereof to be redeemed, (iii) state the redemption price, (iv) state that the Bonds, or the portion of the principal amount thereof to be redeemed, shall become due and payable on the redemption date specified, and the interest thereon, or on the portion of the principal amount thereof to be redeemed, shall cease to accrue from and after the redemption date, and (v) 0108934 -5- specify that payment of the redemption price for the Bonds, or the principal amount thereof to be redeemed, shall be made at Designated Payment/Transfer Office of the Paying Agent/Registrar only upon presentation and surrender thereof by the Holder. If a Bond is SUbject by its terms to prior redemption and has been called for redemption and notice of redemption thereof has been duly given as hereinabove provided, such Bond (or the principal amount thereof to be redeemed) shall become due and payable and interest thereon shall cease to accrue from and after the redemption date therefor; provided moneys sufficient for the payment of such Bond (or of the principal amount thereof to be redeemed) at the then applicable redemption price are held for the purpose of such payment by the Paying Agent/Registrar. SECTION 5: Reaistration - Transfer - Exchange of Bonds- Predecessor Bonds. The Paying Agent/Registrar shall obtain, record, and maintain in the security Register the name and address of each and every owner of the Bonds issued under and pursuant to the provisions of this Ordinance, or if appropriate, the nominee thereof. Any Bond may be transferred or exchanged for Bonds of other authorized denominations by the Holder, in person or by his duly authorized agent, upon surrender of such Bond to the Designated payment/Transfer Office of the Paying Agent/Registrar for cancellation, accompanied by a written instrument of transfer or request for exchange duly executed by the Holder or by his duly authorized agent, in form satisfactory to the Paying Agent/ Registrar. Upon surrender of any Bond (other than the Initial Bond authorized in section 8 hereof) for transfer at the Designated Payment/Transfer Office of the Paying Agent/Registrar, one or more new Bonds shall be registered and issued to the assignee or transferee of the previous Holder; such Bonds to be in authorized denominations, of like Stated Maturity and of a like aggregate principal amount as the Bond or Bonds surrendered for transfer. At the option of the Holder, Bonds (other than the Initial Bond authorized in section 8 hereof) may be exchanged for other Bonds of authorized denominations and having the same Stated Maturity, bearing the same rate of interest and of like aggregate principal amount as the Bonds surrendered for exchange, upon surrender of the Bonds to be exchanged at the Designated Payment/Transfer Office of the Paying Agent/Registrar. Whenever any Bonds are surrendered for exchange, the Paying Agent/Registrar shall register and deliver new Bonds to the Holder requesting the exchange. All Bonds issued in any transfer or exchange of Bonds shall be delivered to the Holders at the Designated Payment/Transfer Office of the Paying Agent/Registrar or sent by United states Mail, first 0108934 -6- class postage prepaid, to the Holders, and, upon the registration and delivery thereof, the same shall be the valid obligations of the City, evidencing the same obligation to pay, and entitled to the same benefits under this ordinance, as the Bonds surrendered in such transfer or exchange. All transfers or exchanges of Bonds pursuant to this Section shall be made without expense or service charge to the Holder, except as otherwise herein provided, and except that the Paying Agent/Registrar shall require payment by the Holder requesting such transfer or exchange of any tax or other governmental charges required to be paid with respect to such transfer or exchange. Bonds cancelled by reason of an exchange or transfer pursuant to the provisions hereof are hereby defined to be "Predecessor Bonds", evidencing all or a portion, as the case may be, of the same obligation to pay evidenced by the new Bond or Bonds registered and delivered in the exchange or transfer therefor. Additionally, the term "Predecessor Bonds" shall include any mutilated, lost, destroyed, or stolen Bond for which a replacement Bond has been issued, registered and delivered in lieu thereof pursuant to the provisions of Section 24 hereof and such new replacement Bond shall be deemed to evidence the same obligation as the mutilated, lost, destroyed, or stolen Bond. Neither the City nor the paying AgentjRegistrar shall be required to issue or transfer to an assignee of a Holder any Bond called for redemption, in whole or in part, within 45 days of the date fixed for the redemption of such Bond; provided, however, such limitation on transferability shall not be applicable to an exchange by the Holder of the unredeemed balance of a Bond called for redemption in part. SECTION 6: Book-Entry Only Transfers and Transactions. Notwithstanding the provisions contained in sections 3, 4 and 5 hereof relating to the payment, and transfer/exchange of the Bonds, the City hereby approves and authorizes the use of "Book-Entry Only" securities clearance, settlement and transfer system provided by The Depository Trust Company (DTC), a limited purpose trust company organized under the laws of the State of New York, in accordance with the requirements and procedures identified in the Letter of Representation, by and between the City, the Paying Agent/Registrar and DTC (the "Depository Agreement") relating to the Bonds. Pursuant to the Depository Agreement and the rules of DTC, the Bonds shall be deposited with DTC who shall hold said Bonds for its participants (the "DTC Participants"). While the Bonds are held by DTC under the Depository Agreement, the Holder of the Bonds on the Security Register for all purposes, including payment and notices, 0108934 -7- shall be Cede & Co., as nominee of DTC, notwi thstanding the ownership of each actual purchaser or owner of each Bond (the "Beneficial Owners") being recorded in the records of DTC and DTC Participants. In the event DTC determines to discontinue serving as securities depository for the Bonds or otherwise ceases to provide book-entry clearance and settlement of securities transactions in general or the City determines that DTC is incapable of properly discharging its duties as securities depository for the Bonds, the City covenants and agrees with the Holders of the Bonds to cause Bonds to be printed in definitive form and provide for the Bond certificates to be issued and delivered to DTC Participants and Beneficial Owners, as the case may be. Thereafter, the Bonds in definitive form shall be assigned, transferred and exchanged on the Security Register maintained by the Paying Agent/Registrar and paYment of such Bonds shall be made in accordance with the provisions of sections 3, 4 and 5 hereof. SECTION 7: Execution - Reaistration. The Bonds shall be executed on behalf of the city by the Mayor or Mayor Pro Tem under its seal reproduced or impressed thereon and countersigned by the ci ty Secretary. The signature of said off icers on the Bonds may be manual or facsimile. Bonds bearing the manual or facsimile signatures of individuals who are or were the proper officers of the City on the Bond Date shall be deemed to be duly executed on behalf of the City, notwithstanding that such individuals or either of them shall cease to hold such offices at the time of delivery of the Bonds to the initial purchaser(s) and with respect to Bonds delivered in subsequent exchanges and transfers, all as authorized and provided in the Bond Procedures Act of 1981, as amended. No Bond shall be entitled to any right or benefit under this Ordinance, or be valid or obligatory for any purpose, unless there appears on such Bond either a certificate of registration substantially in the form provided in section 9C, manually executed by the Comptroller of Public Accounts of the State of Texas, or his duly authorized agent, or a certificate of registt-ation substantially in the form provided in section 9D, manually executed by an authorized officer, employee or representative of the Paying Agent/Registrar, and either such certificate duly signed upon any Bond shall be conclusive evidence, and the only evidence, that such Bond has been duly certified, registered and delivered. SECTION 8: Initial Bond(s). The Bonds herein authorized shall be initially issued either (i) as a single fully registered bond in the total principal amount identified in section 1 with principal installments to become due and payable as provided in section 2 hereof and numbered T-1, or (ii) as seventeen (17) fully registered bonds, being one bond for each year of maturity in the 0108934 -8- applicable principal amount and denomination and to be numbered consecutively from T-1 and upward (hereinafter called the "Initial Bond(s) ") and, in either case, the Initial Bond(s) shall be registered in the name of the initial purchaser(s) or the designee thereof. The Initial Bond(s) shall be the Bonds submitted to the Office of the Attorney General of the state of Texas for approval, certified and registered by the Office of the Comptroller of Public Accounts of the state of Texas and delivered to the initial purchaser(s). Any time after the delivery of the Initial Bond(s), the Paying Agent/ Registrar, pursuant to written instructions from the initial purchaser(s), or the designee thereof, shall cancel the Initial Bond(s) delivered hereunder and exchange therefor definitive Bonds of authorized denominations, stated Maturities, principal amounts and bearing applicable interest rates for transfer and delivery to the Holders named at the addresses identified therefor; all pursuant to and in accordance with such written instructions from the initial purchaser(s), or the designee thereof, and such other information and documentation as the Paying Agent/Registrar may reasonably require. SECTION 9: Forms. A. Forms Generallv. The Bonds, the Registration Certificate of the Comptroller of Public Accounts of the state of Texas, the Registration Certificate of Paying Agent/Registrar, and the form of Assignment to be printed on each of the Bonds, shall be substantially in the forms set forth in this Section with such appropriate insertions, omissions, substitutions, and other variations as are permitted or required by this Ordinance and may have such letters, numbers, or other marks of identification (including identifying numbers and letters of the Committee on Uniform Securities Identification Procedures of the American Bankers Association) and such legends and endorsements (including insurance legends in the event the Bonds are sold with insurance and any reproduction of an opinion of counsel) thereon as may, consistently herewith, be established by the City or determined by the officers executing such Bonds as evidenced by their execution. Any portion of the text of any Bonds may be set forth on the reverse thereof, with an appropriate reference thereto on the face of the Bond. The definitive Bonds and the Initial Bond(s) shall be printed, lithographed, or engraved or typewritten, photocopied or otherwise reproduced in any other similar manner, all as determined by the officers executing such Bonds as evidenced by their execution thereof. 0108934 -9- B. Form of Definitive Bond. REGISTERED REGISTERED NO. $ UNITED STATES OF AMERICA STATE OF TEXAS CITY OF WYLIE, TEXAS, TAX AND WATERWORKS AND SEWER SYSTEM SURPLUS REVENUE REFUNDING BOND, SERIES 1993 Bond Date: AUgust 1, 1993 Interest Rate: Stated Maturity: CUSIP NO: Registered Owner: Principal Amount: DOLLARS The City of Wylie (hereinafter referred to as the "City"), a body corporate and political sUbdivision in the County of Collin, State of Texas, for value received, acknowledges itself indebted to and hereby promises to pay to the order of the Registered Owner named above, or the registered assigns thereof, on the stated Maturity date specified above the Principal Amount hereinabove stated (or so much thereof as shall not have been paid upon prior redemption) and to pay interest on the unpaid principal amount hereof from the Bond Date at the per annum rate of interest specified above computed on the basis of a 360-day year of twelve 30-day months; such interest being payable on February 15 and August 15 in each year, commencing February 15, 1994. Principal of this Bond is payable at its stated Maturity or redemption to the registered owner hereof, upon presentation'\nd surrender, at the Designated Payment/Transfer Office of the fa .ng Agent/Registrar executing the registration certificate appearing hereon, or its successor. Interest is payable to the registered owner of this Bond (or one or more Predecessor Bonds, as defined in the Ordinance hereinafter referenced) whose name appears on the "Security Register" maintained by the Paying Agent/Registrar at the close of business on the "Record Date", which is the last business day of the month next preceding each interest payment date, and interest shall be paid by the Paying Agent/Registrar by check sent united States Mail, first class postage prepaid, to the address of the registered owner recorded in the Security Register or by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the registered owner. All 0108934 -10- payments of principal of, premium, if any, and interest on this Bond shall be without exchange or collection charges to the owner hereof and in any coin or currency of the United states of America which at the time of payment is legal tender for the payment of public and private debts. This Bond is one of the series specified in its title issued in the aggregate principal amount of $5,890,000 (herein referred to as the "Bonds") for the purpose of refunding certain outstanding obligations of the City (identified in the Ordinance) and paying costs of issuance, under and in strict conformity with the Constitution and laws of the state of Texas, including Article 717k, V.A.T.C.S., as amended, and pursuant to an Ordinance adopted by the City Council of the City (herein referred to as the "Ordinance"). The Bonds maturing on and after February 15, 2003 may be redeemed prior to their stated Maturities, at the option of the City, in whole or in part in principal amounts of $5,000 or any integral multiple thereof (and if within a stated Maturity by lot by the Paying Agent/Registrar), on February 15, 2002, or on any date thereafter, at the redemption price of par, together with accrued interest to the date of redemption and upon 30 days prior written notice being sent by United states Mail, first class postage prepaid, to the registered owners of the Bonds to be redeemed, and subject to the terms and provisions relating thereto contained in the Ordinance. If this Bond (or any portion of the principal sum hereof) shall have been duly called for redemption and notice of such redemption duly given, then upon such redemption date this Bond (or the portion of the principal sum hereof to be redeemed) shall become due and payable, and interest thereon shall cease to accrue from and after the redemption date therefor, provided moneys for the payment of the redemption price and the interest on the principal amount to be redeemed to the date of redemption are held for the purpose of such payment by the Paying Agent/Registrar. In the event of a partial redemption of the principal amount of this Bond, payment of the redemption price of such principal amount shall be made to the registered owner only upon presentation and surrender of this Bond to the Designated Payment/Transfer Office of the Paying Agent/Registrar, and there shall be issued to the registered owner hereof, without charge, a new Bond or Bonds of like maturity and interest rate in any authorized denominations provided by the Ordinance for the then unredeemed balance of the principal sum hereof. If this Bond is selected for redemption, in whole or in part, the City and the Paying Agent/Registrar shall not be required to transfer this Bond to an assignee of the registered owner within 45 days of the redemption date therefor; provided, however, such limitation on transferability shall not be applicable 0108934 -11- to an exchange by the registered owner of the unredeemed balance hereof in the event of its redemption in part. The Bonds are payable from the proceeds of an ad valorem tax levied, within the limitations prescribed by law, upon all taxable property in the City and, together with the outstanding and unpaid Previously Issued Obligations (identified and defined in the Ordinance), are additionally payable from and secured by a lien on and pledge of the Net Revenues (as defined in the Ordinance) of the City'S combined Waterworks and Sewer System (the "System"), such lien and pledge, however, being junior and subordinate to the lien on and pledge of the Net Revenues of the System securing the payment of "Prior Lien Bonds" (as defined in the Ordinance) now outstanding and hereafter issued by the City. In the Ordinance, the City reserves and retains the right to issue Prior Lien Bonds without limitation as to principal amount but subject to any applicable terms, conditions or restrictions under law or otherwise as well as the right to issue additional obligations payable from the same sources as the Bonds and, together with the Bonds and the Previously Issued Obligations, equally and ratably secured by a parity lien on and pledge of the Net Revenues of the System. Reference is hereby made to the Ordinance, a copy of which is on file in the Designated Payment/Transfer Office of the Paying Agent/Registrar, and to all the provisions of which the owner or holder of this Bond by the acceptance hereof hereby assents, for definitions of terms; the description of and the nature and extent of the tax levied for the payment of the Bonds; the properties constituting the System; the Net Revenues pledged to the payment of the principal of and interest on the Bonds; the nature and extent and manner of enforcement of the pledge; the terms and conditions relating to the transfer or exchange of this Bond; the conditions upon which the Ordinance may be amended or supplemented with or without the consent of the Holders; the rights, duties, and obligations of the City and the Paying Agent/Registrar; the terms and provisions upon which the tax levy and the liens, pledges, charges and covenants made therein may be discharged at or prior to the maturity of this Bond, and this Bond deemed to be no longer Outstanding thereunder; and for the other terms and provisions contained therein. capitalized terms used herein have the meanings assigned in the Ordinance. This Bond, subject to certain limitations contained in the Ordinance, may be transferred on the Security Register only upon its presentation and surrender at the Designated Payment/Transfer Office of the Paying Agent/Registrar, with the Assignment hereon duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Paying Agent/Registrar duly executed by, the registered owner hereof, or his duly authorized agent. When a transfer on the Security Register occurs, one or more 0108934 -12- new fully registered Bonds of the same stated Maturity, of authorized denominations, bearing the same rate of interest, and of the same aggregate principal amount will be issued by the Paying Agent/Registrar to the designated transferee or transferees. The City and the Paying Agent/Registrar, and any agent of either, shall treat the registered owner whose name appears on the Security Register (i) on the Record Date as the owner entitled to payment of interest hereon, (ii) on the date of surrender of this Bond as the owner entitled to payment of principal hereof at its Stated Maturity or its redemption, in whole or in part, and (iii) on any other date as the owner for all other purposes, and neither the City nor the Paying Agent/Registrar, or any agent of either, shall be affected by notice to the contrary. In the event of nonpayment of interest on a scheduled payment date and for thirty (30) days thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received from the city. Notice of the Special Record Date and of the scheduled payment date of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least five (5) business days prior to the Special Record Date by United States Mail, first class postage prepaid, to the address of each Holder appearing on the Security Register at the close of business on the last business day next preceding the date of mailing of such notice. It is hereby certified, recited, represented and declared that the City is a body corporate and political subdivision dUly organized and legally existing under and by virtue of the Constitution and laws of the State of Texas; that the issuance of the Bonds is duly authorized by law; that all acts, conditions and things required to exist and be done precedent to and in the issuance of the Bonds to render the same lawful and valid obligations of the City have been properly done, have happened and have been performed in regular and due time, form and manner as required by the Constitution and laws of the state of Texas, and the ordinance; that the Bonds do not exceed any Constitutional or statutory limitation; and that due provision has been made for the payment of the principal of and interest on the Bonds by the levy of a tax and a pledge of and lien on the Net Revenues of the System as aforestated. In case any provision in this Bond shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. The terms and provisions of this Bond and the Ordinance shall be construed in accordance with and shall be governed by the laws of the State of Texas. 0108934 -13- IN WITNESS WHEREOF, the City Council of the City has caused this Bond to be duly executed under the official seal of the City as of the Bond Date. CITY OF WYLIE, TEXAS COUNTERSIGNED: Mayor City Secretary (SEAL) C. *Form of Reaistration Certificate of ComDtroller of Public Accounts to aDDear on Initial Bondls) only. REGISTRATION CERTIFICATE OF COMPTROLLER OF PUBLIC ACCOUNTS OFFICE OF THE COMPTROLLER OF PUBLIC ACCOUNTS ( ( ( ( REGISTER NO. THE STATE OF TEXAS I HEREBY CERTIFY that this Bond has been examined, certified as to validity and approved by the Attorney General of the State of Texas, and duly registered by the Comptroller of Public Accounts of the State of Texas. WITNESS my signature and seal of office this Comptroller of Public Accounts of the State of Texas (SEAL) 0108934 -14- D. Form of certificate of Pavina Aaent/Reaistrar to aDDear on Definitive Bonds only. REGISTRATION CERTIFICATE OF PAYING AGENT/REGISTRAR This Bond has been duly issued and registered under the provisions of the within-mentioned Ordinance; the bond or bonds of the above entitled and designated series originally delivered having been approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts, as shown by ~he records of the Paying Agent/Registrar. The principal offices of the Paying Agent/Registrar in Dallas, Texas, is the "Designated Payment/Transfer Office" for this Bond. Registration Date: AMERITRUST TEXAS NATIONAL ASSOCIATION, as Paying Agent/Registrar By Authorized Signature *NOTE TO PRINTER: Do Not Print on Definitive Bonds E. Form of Assianment. ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sells, assigns, and transfers unto (print or typewrite name, address, and zip code of transferee: ) (Social Security or other identifying number: ) the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints attorney. to transfer the within Bond on the books kept for registration thereof, with full power of substitution in the premises. DATED: Signature guaranteed: NOTICE: The signature on this assignment must correspond with the name of the registered owner as it appears on the face of the within Bond in every particular. 0108934 -15- F. The Initial Bondls) shall be in the form set forth in DaraaraDh B of this Section. exceDt that the form of the sinale fullv reaistered Initial Bond shall be modified as follows: (i) immediately under the name of the bond the headings "Interest Rate " and "Stated Maturity " shall both be omitted; ( ii) Paragraph one shall read as follows: Registered Owner: Principal Amount: Dollars The City of Wylie (hereinafter referred to as the "city"), a body corporate and municipal corporation in the County of Collin, State of Texas, for value received, acknowledges itself indebted to and hereby promises to pay to the order of the Registered Owner named above, or the registered assigns thereof, the Principal Amount hereinabove stated on February 15 in each of the years and in principal installments in accordance with the following schedule: YEAR OF MATURITY PRINCIPAL INSTALLMENTS INTEREST RATE (Information to be inserted from schedule in Section 2 hereof). (or so much principal thereof as shall not have been prepaid prior to maturity) and to pay interest on the unpaid Principal Amount hereof from the Bond Date at the per annum rates of interest specified above computed on the basis of a 360-day year of twelve 30-day months; such interest being payable on February 15 and August 15 in each year, commencing February 15, 1994. Principal installments of this Bond are payable in the year of maturity or on a prepayment date to the registered owner hereof by Ameritrust Texas National Association (the "paying Agent/Registrar"), upon presentation and surrender, at its principal offices in Dallas, Texas (the "Designated Payment/Transfer Office"). Interest is payable to the registered owner of this Bond whose name appears on the "Security Register" maintained by the Paying Agent/Registrar at the close of business on the "Record Date", which is the last business day of the month next preceding each interest payment date, and interest shall be paid by the paying Agent/Registrar by check sent United states Mail, first class postage prepaid, to the address of the registered owner recorded in the Security Register or by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the registered owner. 0108934 -16- All payments of principal of, premium, if any, and interest on this Bond shall be without exchange or collection charges to the owner hereof and in any coin or currency of the united states of America which at the time of payment is legal tender for the payment of public and private debts. SECTION 10: Definitions. For purposes of this Ordinance and for clarity with respect to the issuance of the Bonds herein authorized, and the levy of taxes and appropriation of Net Revenues therefor, the following words or terms, whenever the same appears herein without qualifying language, are defined to mean as follows: (a) The term "Bond Fund" shall mean the special Fund created and established under the provisions of Section 11 of this Ordinance. (b) The term "Bonds" shall mean the "City of Wylie, Texas, Tax and Waterworks and Sewer System Surplus Revenue Refunding Bonds, Series 1993", dated August 1, 1993 authorized by this Ordinance. (c) The term "Collection Date" shall mean, when reference is being made to the levy and collection of annual ad valorem taxes, the date the annual ad valorem taxes levied each year by the City become delinquent. (d) The term "Fiscal Year" shall mean the twelve months' period ending September 30th of each year. (e) The term "Net Revenues" shall mean the gross revenues of the System, less the expense of operation and maintenance, including all salaries, labor, materials, interest, repairs and extensions necessary to render eff icient service; provided, however, that only such repairs and extensions, as in the judgment of the City Council, reasonably and fairly exercised, are necessary to keep the System in operation and render adequate service to the City and the inhabitants thereof, or such as might be necessary to meet some physical accident or condition which would otherwise impair any obligations payable from and secured by a lien on the Net Revenues shall be deducted in determining "Net Revenues". (f) The term "Government Obligations" shall mean direct obligations of the United States of America, including obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, and United States Treasury obligations such as its State and Local Government Series in book-entry form. 0108934 -17- 0108934 (g) The term "outstanding" when used in this Ordinance with respect to Bonds means, as of the date of determination, all Bonds theretofore issued and delivered under this Ordinance, except: (1) those Bonds cancelled by the Paying Agent/Registrar or delivered to the Paying Agent/Registrar for cancellation; (2) those Bonds for which payment has been duly provided by the City in accordance with the provisions of Section 25 hereof; and (3) those Bonds that have mutilated, destroyed, lost, or stolen replacement Bonds have been registered delivered in lieu thereof as provided Section 24 hereof. been and and in (h) The term "Prior Lien Bonds" shall mean all bonds or other similar obligations now outstanding and hereafter issued that are payable from and secured by a lien on and pledge of the Net Revenues of the System, which is prior in right and claim to the lien on and pledge of the Net Revenues securing the payment of the Bonds, including, but not limited to the outstanding and unpaid Refunded Obligations until defeased with the proceeds of the Bonds. (i) The term "Previously Issued Obligations" shall mean outstanding and unpaid "City of Wylie, Texas, Tax and Waterworks and Sewer System Subordinate Lien Revenue Certificates of Obligation, Series 1989", dated June 15, 1989, and originally issued in the aggregate principal amount of $200,000. (j) The term "Similarly Secured Obligations" shall mean additional tax and revenue obligations hereafter issued under and pursuant to the provisions of V.T.C.A., Local Government Code, Subchapter C of Chapter 271, or other law that are payable from ad valorem taxes and additionally payable from and secured by a lien on and pledge of the Net Revenues of the System on a parity with and of equal rank and dignity with the lien and pledge securing the payment of the Previously Issued Obligations and the Bonds. (k) The term "System" shall mean the city's combined Waterworks and Sanitary Sewer System, including -18- all properties, real, personal, mixed or otherwise, now owned or hereafter acquired by the City of Wylie through purchase, construction or otherwise, and used in connection with the System and in anywise appertaining thereto, whether situated within or without the limits of the city. SECTION 11: Bond Fund. For the purpose of paying the interest on and to provide a sinking fund for the payment, redemption and retirement of the Bonds, there shall be and is hereby created a special account or fund on the books and records of the city known as "SPECIAL 1993 TAX AND REVENUE REFUNDING BOND FUND", which Fund shall be kept and maintained at the City'S depository bank, and moneys deposited in said Fund shall be used for no other purpose. Authorized officials of the City are hereby authorized and directed to make withdrawals from said Fund sufficient to pay the principal of and interest on the Bonds as the same become. due and payable, and, shall cause to be transferred to the Paying Agent/Registrar from moneys on deposit in the Bond Fund an amount sufficient to pay the amount of principal and/or interest falling due on the Bonds, such transfer of funds to the Paying Agent/Registrar to be made in such manner as will cause immediately available funds to be deposited with the Paying Agent/Registrar on or before the last business day next preceding each interest and principal payment date for the Bonds. Pending the transfer of funds to the Paying Agent/Registrar, money in the Bond Fund may, at the option of the city, be invested in obligations identified in, and in accordance with the provisions of the "Public Funds Investment Act of 1987" relating to the investment of "bond proceeds"; provided that all such investments shall be made in such a manner that the money required to be expended from said Fund will be available at the proper time or times. All interest and income derived from deposits and investments in said Bond Fund shall be credited to, and any losses debited to, the said Bond Fund. All such investments shall be sold promptly when necessary to prevent any default in connection with the Bonds. SECTION 12: Tax Levv. To provide for the payment of the "Debt Service Requirements" on the Bonds being (i) the interest on said Bonds and (ii) a sinking fund for their redemption at maturity or a sinking fund of 2% (whichever amount shall be the greater), there shall be and there is hereby levied for the current year and each succeeding year thereafter while said Bonds or any interest thereon shall remain outstanding, a sufficient tax on each one hundred dollars' valuation of taxable property in said City, adequate to pay such Debt Service Requirements, full allowance being made for delinquencies and costs of collection; said tax shall be assessed and collected each year and applied to the 0108934 -19- payment of the Debt Service Requirements, and the same shall not be diverted to any other purpose. The taxes so levied and collected shall be paid into the Bond Fund. The City Council hereby declares its purpose and intent to provide and levy a tax legally and fully sufficient to pay the said Debt Service Requirements, it having been determined that the existing and available taxing authority of the City for such purpose is adequate to permit a legally sufficient tax in consideration of all other outstanding indebtedness. The amount of taxes to be provided annually for the payment of the principal of and interest on the Bonds shall be determined and accomplished in the following manner: (a) Prior to the date the City Council establishes the annual tax rate and passes an ordinance levying ad valorem taxes each year, the Council shall determine: (1) The amount on deposit in the Bond Fund after (a) deducting therefrom the total amount of Debt Service Requirements to become due on Bonds prior to the Collection Date for the ad valorem taxes to be levied and (b) adding thereto the amount of the Net Revenues of the System appropriated and allocated to pay such Debt Service Requirements prior to the Collection Date for the ad valorem taxes to be levied. (2) The amount of Net Revenues of the System, appropriated and to be set aside for the payment of the Debt Service Requirements on the Bonds between the Collection Date for the taxes then to be levied and the Collection Date for the taxes to be levied during the next succeeding calendar year. (3) The amount of Debt Service Requirements to become due and payable on the Bonds between the Collection Date for the taxes then to be levied and the Collection Date for the taxes to be levied during the next succeeding calendar year. (b) The amount of taxes to be levied annually each year to pay the Debt Service Requirements on the Bonds shall be the amount established in paragraph (3) above less the sum total of the amounts established in paragraphs (1) and (2), after taking into consideration delinquencies and costs of collecting such annual taxes. SECTION 13: Pledae of Revenues. The City hereby covenants and agrees that, subject to the prior lien on and pledge of the Net Revenues of the System to the payment and security of Prior Lien 0108934 -20- Bonds, all the Net Revenues of the System, with the exception of those in excess of the amounts required to be deposited to the Bond Fund as hereafter provided, are hereby irrevocably pledged, equally and ratably, to the payment of the principal of and interest on the Previously Issued Obligations, the Bonds and Similarly Secured Obligations, and the pledge of Net Revenues of the System herein made for the payment of the Bonds shall constitute a lien on the Net Revenues of the System in accordance with the terms and provisions hereof and be valid and binding without further action by the City and without any filing or recording except for the filing of this Ordinance in the records of the city. SECTION 14: System Fund. The city hereby covenants and agrees that all revenues derived from the operation of the System shall be accounted for separate and apart from all other funds, accounts and moneys of the City, and all such revenues shall be deposited as collected into the "System Fund" maintained at the City's depository bank and created and established in connection with the issuance of the outstanding Prior Lien Bonds and hereby reaffirmed to be maintained during the period of time the Bonds are Outstanding. All moneys deposited to the credit of the System Fund shall be pledged and appropriated to the extent required for the following purposes and in the order of priority shown, to wit: First: To the payment of the reasonable and proper expenses of operating and maintaining the System as defined in section 10 hereof or required by statute to be a first charge on and claim against the revenues of the System. Second: To the payment of all amounts required to be deposited in the special Funds created and established for the payment, security and benefit of Prior Lien Bonds in accordance with the terms and provisions of any ordinance authorizing the issuance of Prior Lien Bonds. Third: Equally and ratably, to the payment of the amounts required to be deposited in the special funds and accounts created and established for the payment of the Previously Issued Obligations, the Bonds (the Bond Fund) and Similarly Secured Obligations. Any Net Revenues remaining in the System Fund after satisfying the foregoing payments, or making adequate and sufficient provision for the payment thereof, may be appropriated and used for any other City purpose now or hereafter permitted by law. 0108934 -21- SECTION 15: DeDosits to Bond Fund. The City hereby covenants and agrees to cause to be deposited to the credit of the Bond Fund prior to each principal and interest payment date for the Bonds from the pledged Net Revenues of the System in the System Fund, after the deduction of all payments required to be made to the special Funds or accounts created for the payment and security of the Pr ior Lien Bonds, an amount equal to one hundred per centum (100%) of the amount required to fully pay the interest and principal then due and payable on the Bonds, such deposits to pay maturing principal and accrued interest on the Bonds to be made in substantially equal monthly installments on or before the 20th day of each month beginning the 20th day of the month first to follow the date of delivery of the Bonds to the initial purchaser(s). The deposits to be made to the credit of the Bond Fund, as hereinabove provided, shall be made until such time as such Fund contains an amount equal to pay the principal of and interest and premium, if any, on the Bonds to maturity or redemption, as the case may be. Accrued interest and premium, if any, received from the purchaser of the Bonds deposited to the Bond Fund and ad valorem taxes levied, collected and deposited in the Bond Fund for and on behalf of the Bonds may be taken into consideration and reduce the amount of the deposits otherwise required to be deposited in the Bond Fund from the Net Revenues of the System. In addition, any surplus proceeds from the sal.e of the Bonds not expended for authorized purposes shall be deposited in the Bond Fund, and such amounts so deposited shall reduce the sums otherwise required to be deposited in sai~ Fund from ad valorem taxes and the Net Revenues of the System. SECTION 16: Securitv of Funds. All moneys on deposit in the Funds for which this Ordinance makes provision (except any portion thereof as may be at any time properly invested) shall be secured in the manner and to the fullest extent required by the laws of Texas for the security of public funds, and moneys on deposit in such Funds shall be used only for the purposes permitted by this Ordinance. SECTION 17: Maintenance of Svstem - Insurance. The City covenants and agrees that while the Bonds remain outstanding, it will maintain and operate the System with all. possible efficiency and maintain casualty and other insurance on the properties of the System and its operations of a kind and in such amounts customarily carried by municipal corporations in the State of Texas engaged in a similar type business; that it will faithfully and punctually perform all duties with reference to the System required by the Constitution and laws of the State of Texas. SECTION 18: Rates and Charaes. The City hereby covenants and agrees with the Holders of the Bonds that rates and charges for 0108934 -22- services afforded by the System will be established and maintained that are reasonably expected, on the basis of available information and experience and with due allowance for contingencies, to provide revenues in each Fiscal Year sufficient to pay: (a) All operating, maintenance, depreciation, replacement, betterment and other costs incurred in the maintenance and operation of the System; (b) the interest on and principal of the Prior Lien Bonds as the same becomes due and payable and the amounts required to be deposited in any special Fund created and established for the payment and security thereof and (ii) the amounts, if any, required to be deposited in the special funds created and established for the payment of the Previously Issued Obligations, the Bonds (the Bond Fund) and Similarly Secured Obligations. (c) any other legally incurred indebtedness payable from the revenues of the System and/or secured by a lien on the System or the revenues thereof. SECTION 19: Records and Accounts - Annual Audit. The City further covenants and agrees that so long as any of the Bonds remain Outstanding, it will keep and maintain separate and complete records and accounts pertaining to the operations of the System in which complete and correct entries shall be made of all transactions relating thereto, as provided. by Article 1113, V.A.T.C.S., or other applicable law. The Holders of the Bonds or any duly authorized agent or agents of such Holders shall have the right to inspect the System and all properties comprising the same. The City further agrees that following the close of each Fiscal Year, it will cause an audit of such books and accounts to be made by an independent firm of certified Public Accountants. copies of each annual audit shall be furnished to the Executive Director of the Municipal Advisory Council of Texas at his office in Austin, Texas, and, upon written request, to the original purchaser of the Bonds and any subsequent Holder thereof. SECTION 20: Remedies in Event of Default. In addition to all the rights and remedies provided by the laws of the State of Texas, the City covenants and agrees particularly that in the event the City (a) defaults in the payments to be made to the Bond Fund, or (b) defaults in the observance or performance of any other of the covenants, conditions or obligations set forth in this Ordinance, the owner or owners of any of the Bonds shall be entitled to a writ of mandamus issued by a court of proper jurisdiction compelling and requiring the governing body of the City and other officers of the City to observe and perform any covenant, condition or obligation prescribed in this Ordinance. 0108934 -23- No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power, or shall be construed to be a waiver of any such default or acquiescence therein, and every such right and power may be exercised from time to time and as often as may be deemed expedient. The specific remedies herein provided shall be cumulative of all other existing remedies and the specification of such remedies shall not be deemed to be exclusive. SECTION 21: Special Covenants. covenants as follows: The City hereby further (a) It has the lawful power to pledge the Net Revenues of the System supporting this issue of Bonds and has lawfully exercised said powers under the Constitution and laws of the State of Texas. (b) other than for the payment of the Bonds, the Refunded Obligations (until defeased with the proceeds of sale of the Bonds), the outstanding Previously Issued Obligations and the "City of Wylie, Texas, Tax and Waterworks and Sewer System Limited Pledge Revenue Certificates of obligation, Series 1988", dated May 15, 1988 and "City of Wylie, Texas, Tax and Waterworks and Sewer System Limited Pledge Revenue Certificates of obligation, Series 1990", dated February 15, 1990, the Net Revenues of the System have not in any manner been pledged to the payment of any debt or obligation of the City or of the System. SECTION 22: Issuance of Prior Lien Bonds and Similarly Secured Obliaations. The City hereby expressly reserves the right to hereafter issue Prior Lien Bonds, without limitation as to principal amount but subject to any terms, conditions or restrictions applicable thereto under law or otherwise, and, also reserves the right to issue Similarly Secured Obligations which, together with the Previously Issued Obligations and the Bonds, shall be equally and ratably secured by a parity lien on and pledge of the Net Revenues of the System. SECTION 23: ADDlication of Prior Lien Bonds Covenants and Aareements. It is the intention of this governing body and accordingly hereby recognized and stipulated that the provisions, agreements and covenants contained herein bearing upon the management and operations of the System, and the administering and application of revenues derived from the operation thereof, shall to the extent possible be harmonized with like provisions, agreements and covenants contained in the ordinances authorizing the issuance of the Prior Lien Bonds, and to the extent of any irreconcilable conflict between the provisions contained herein and 0108934 -24- in the ordinances authorizing the issuance of the Prior Lien Bonds, the provisions, agreements and covenants contained therein shall prevail to the extent of such conflict and be applicable to this Ordinance but in all respects subject to the priority of rights and benefits, if any, conferred thereby to the holders of the Prior Lien Bonds. Notwithstanding the above, any change or modification affecting the application of revenues derived from the operation of the System shall not impair the obligation of contract with respect to the pledge of revenues herein made for the payment and security of the Bonds. SECTION 24: Mutilated - Destroved - Lost and Stolen Bonds. In case any Bond shall be mutilated, or destroyed, lost or stolen, the Paying Agent/Registrar may execute and deliver a replacement Bond of like form and tenor, and in the same denomination and bearing a number not contemporaneously outstanding, in exchange and substitution for such mutilated Bond, or in lieu of and in substitution for such destroyed, lost or stolen Bond, only upon the approval of the City and after (i) the filing by the Holder thereof with the Paying Agent/Registrar of evidence satisfactory to the Paying Agent/Registrar of the destruction, loss or theft of such Bond, and of the authenticity of the ownership thereof and (ii) the furnishing to the Paying Agent/Registrar of indemnification in an amount satisfactory to hold the City and the Paying Agent/Registrar harmless. All expenses and charges associated with such indemnity and with the preparation, execution and delivery of a replacement Bond shall be borne by the Holder of the Bond mutilated, or destroyed, lost or stolen. Every replacement Bond issued pursuant to this Section shall be a valid and binding obligation, and shall be entitled to all the benefits of this Ordinance equally and ratably with all other outstanding Bonds; notwithstanding the enforceability of payment by anyone of the destroyed, lost, or stolen Bonds. The provlslons of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement and payment of mutilated, destroyed, lost or s~olen Bonds. SECTION 25: Satisfaction of Obliqation of Citv. If the City shall payor cause to be paid, or there shall otherwise be paid to the Holders, the principal of, premium, if any, and interest on the Bonds, at the times and in the manner stipulated in this Ordinance, then the pledge of taxes levied under this Ordinance and the lien on and pledge of the Net Revenues created by this Ordinance and all covenants, agreements, and other obligations of the City to the Holders shall thereupon cease, terminate, and be discharged and satisfied. 0108934 -25- Bonds or any principal amount(s) thereof shall be deemed to have been paid within the meaning and with the effect expressed above in this Section when (i) money sufficient to pay in full such Bonds or the principal amount(s) thereof at maturity or to the redemption date therefor, together with all interest due thereon, shall have been irrevocably deposited with and held in trust by the Paying Agent/Registrar, or an authorized escrow agent, or (ii) Government Obligations shall have been irrevocably deposited in trust with the Paying Agent/Registrar, or an authorized escrow agent, which Government Obligations have been certified by an independent accounting firm to mature as to principal and interest in such amounts and at such times as will insure the availability, without reinvestment, of sufficient money, together with any moneys deposited therewith, if any, to pay when due the principal of and interest on such Bonds, or the principal amount(s) thereof, on and prior to the Stated Maturity thereof or (if notice of redemption has been duly given or waived or if irrevocable arrangements therefor acceptable to the Paying Agent/Registrar have been made) the redemption date thereof. The City covenants that no deposit of moneys or Government Obligations will be made under this Section and no use made of any such deposit which would cause the Bonds to be treated as "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, or regulations adopted pursuant thereto. Any moneys so deposited with the Paying Agent/Registrar, or an authorized escrow agent, and all income from Government Obligations held in trust by the Paying Agent/Registrar, or an authorized escrow agent, pursuant to this Section which is not required for the payment of the Bonds, or any principal amount(s) thereof, or interest thereon with respect to which such moneys have been so deposited shall be remitted to the City or deposited as directed by the City. Furthermore, any money held by the Paying Agent/Registrar for the payment of the principal of and interest on the Bonds and remaining unclaimed for a period of four (4) years after the Stated Maturity, or applicable redemption date, of the Bonds such moneys were deposited and are held in trust to pay shall upon the request of the City be remitted to the City against a written receipt therefor. Notwithstanding the above and foregoing, any remittance of funds from the Paying Agent/Registrar to the City shall be sUbject to any applicable unclaimed property laws of the state of Texas. SECTION 26: Ordinance a Contract ~ Amendments. This Ordinance shall constitute a contract with the Holders from time to time, be binding on the City, and shall not be amended or repealed by the City so long as any Bond remains outstanding except as permitted in this Section. The City may, without the consent of or notice to any Holders, from time to time and at any time, amend this Ordinance in any manner not detrimental to the interests of 0108934 -26- the Holders, including the curing of any ambiguity, inconsistency, or formal defect or omission herein. In addition, the City may, with the consent of Holders holding a majority in aggregate principal amount of the Bonds then outstanding affected thereby, amend, add to, or rescind any of the provisions of this ordinance; provided that, without the consent of all Holders of outstanding Bonds, no such amendment, addition, or rescission shall (1) extend the time or times of payment of the principal of, premium, if any, and interest on the Bonds, reduce the principal amount thereof, the redemption price therefor, or the rate of interest thereon, or in any other way modify the terms of payment of the principal of, premium, if any, or interest on the Bonds, (2) give any preference to any Bond over any other Bond, or (3) reduce the aggregate principal amount of Bonds required to be held by Holders for consent to any such amendment, addition, or rescission. SECTION 27: Covenants to Maintain Tax-ExemDt status. (a) Definitions. When used in this Section, the following terms shall have the following meanings: "Closing Date" means the date on which the Bonds are first authenticated and delivered to the initial purchasers against payment therefor. "Code" means the Internal Revenue Code of 1986, as amended by all legislation, if any, effective on or before the Closing Date. "Computation Date" has the meaning set forth in section 1.148-1(b) of the Regulations. "Gross Proceeds" means any proceeds as defined in section 1.148-1 (b) of the Regulations, and any replacement proceeds as defined in Section 1.148-1(c) of the Regulations, of the Bonds. "Investment" has the meaning set forth in section 1.148-1(b) of the Regulations. "Nonpurpose Investment" means any investment property, as defined in section 148(b) of the Code, in which Gross Proceeds of the Bonds are invested and which is not acquired to carry out the governmental purposes of the Bonds. "Rebate Amount" has the meaning set forth in Section 1.148-1(b) of the Regulations. 0108934 -27- "Regulations" means any proposed, temporary, or final Income Tax Regulations issued pursuant to Sections 103 and 141 through 150 of the Code, and 103 of the Internal Revenue Code of 1954, which are applicable to the Bonds. Any reference to any specific Regulation shall also mean, as appropriate, any proposed, temporary or final Income Tax Regulation designed to supplement, amend or replace. the specific Regulation referenced. "Yield" of (1) any Investment has the meaning set forth in Section 1.148-5 of the Regulations; and (2) the Bonds has the meaning set forth in Section 1.148-4 of the Regulations. (b) Not to Cause Interest to Become Taxable. The City shall not use, permit the use of, or omit to use Gross Proceeds or any other amounts (or any property the acquisition, construction or improvement of which is to be financed directly or indirectly with Gross Proceeds) in a manner which if made or omitted, respectively, would cause the interest on any Bond to become includable in the gross income, as defined in section 61 of the Code, of the owner thereof for federal income tax purposes. Without limiting the generality of the foregoing, unless and until the City receives a written opinion of counsel nationally recognized in the field of municipal bond law to the effect that failure to comply with such covenant will not adversely affect the exemption from federal income tax of the interest on any Bond, the City shall comply with each of the specific covenants in this section. (c) No Private Use or Private Payments. Except as permitted by section 141 of the Code and the Regulations and rulings thereunder, the City shall at all times prior to the last Stated Maturity of Bonds: (1) exclusively own, operate and possess all property the acquisition, construction or improvement of which is to be financed or refinanced directly or indirectly with Gross Proceeds of the Bonds (including property financed with Gross Proceeds of the Refunded Obligations), and not use or permit the use of such Gross Proceeds (including all contractual arrangements with terms different than those applicable to the general public) or any property acquired, constructed or improved with such Gross Proceeds in any activity carried on by any person or entity (including the United States or any agency, department and instrumentality thereof) other 0108934 -28- than a state or local government, unless such use is solely as a member of the general public; and (2) not directly or indirectly impose or accept any charge or other payment by any person or entity who is treated as using Gross Proceeds of the Bonds or any property the acquisition, construction or improvement of which is to be financed or refinanced directly or indirectly with such Gross Proceeds (including property financed with Gross Proceeds of the Refunded Obligations), other than taxes of general application within the City or interest earned on investments acquired with such Gross Proceeds pending application for their intended purposes. (d) No Private Loan. Except to the extent permitted by section 141 of the Code and the Regulations and rulings thereunder, the City shall not use Gross Proceeds of the Bonds to make or finance loans to any person or entity other than a state or local government. For purposes of the foregoing covenant, such Gross Proceeds are considered to be "loaned" to a person or entity if: (1) property acquired, constructed or improved with such Gross Proceeds is sold or leased to such person or entity in a transaction which creates a debt for federal income tax purposes; (2) capacity in or service from such property is committed to such person or entity under a take-or-pay, output or similar contract or arrangement; or (3) indirect benefits, or burdens and benefits of ownership, of such Gross Proceeds or any property acquired, constructed or improved with such Gross Proceeds are otherwise transferred in a transaction which is the economic equivalent of a loan. (e) Not to Invest at Higher Yield. Except to the extent permitted by section 148 of the Code and the Regulations and rulings thereunder, the City shall not at any time prior to the final stated Maturity of the Bonds directly or indirectly invest Gross Proceeds in any Investment (or use Gross Proceeds to replace money so invested), if as a result of such investment the Yield from the Closing Date of all Investments acquired with Gross Proceeds (or with money replaced thereby), whether then held or previously disposed of, exceeds the Yield of the Bonds. (f) Not Federally Guaranteed. Except to the extent permitted by section 149 (b) .of the Code and the Regulations and rulings thereunder, the City shall not take or omit .to take any action which would cause the Bonds to be federally guaranteed within the meaning of section 149 (b) of the Code and the Regulations and rulings thereunder. 0108934 -29- (g) Information ReDort. The City shall timely file the information required by section 149 (e) of the Code with the Secretary of the Treasury on Form 8038-G or such other form and in such place as the Secretary may prescribe. (h) Rebate of Arbitraae Profits. Except to the extent otherwise provided in section 148(f) of the Code and the Regulations and rUlings thereunder: (1) The City shall account for all Gross Proceeds (including all receipts, expenditures and investments thereof) on its books of account separately and apart from all other funds (and receipts, expenditures and investments thereof) and shall retain all records of accounting for at least six years after the day on which the last outstanding Bond is discharged. However, to the extent permitted by law, the City may commingle Gross Proceeds of the Bonds with other money of the City, provided that the City separately accounts for each receipt and expenditure of Gross Proceeds and the obligations acquired therewith. (2) Not less frequently than each Computation Date, the City shall calculate the Rebate Amount in accordance with rules set forth in section 148(f) of the Code and the Regulations and rulings thereunder. The City shall maintain such calculations with its official transcript of proceedings relating to the issuance of the Bonds until six years after the final computation Date. (3) As additional consideration for the purchase of the Bonds by the Purchasers and the loan of the money represented thereby and in order to induce such purchase by measures designed to insure the excludability of the interest thereon from the gross income of the owners thereof for federal income tax purposes, the City shall pay to the united States out of the Bond Fund or its general fund, as permitted by applicable Texas statute, regulation or opinion of the Attorney General of the state of Texas, the amount that when added to the future value of previous rebate payments made for the Bonds equals (i) in the case of a Final Computation Date as defined in Section 1.148-3(e) (2) of the Regulations, one hundred percent (100%) of the Rebate Amount on such date; and (ii) in the case of any other Computation Date, ninety percent (90%) of the Rebate Amount on such date. In all cases, the rebate payments shall be made at the times, in the installments, to the place and in the manner as is or may be required by section 148(f) of the Code and the Regulations and rulings thereunder, and 0108934 -30- shall be accompanied by Form 8038-T or such other forms and information as is or may be required by Section 148 (f) of the Code and the Regulations and rulings thereunder. (4) The City shall exercise reasonable diligence to assure that no errors are made in the calculations and payments required by paragraphs (2) and (3), and if an error is made, to discover and promptly correct such error within a reasonable amount of time thereafter (and in all events within one hundred eighty (180) days after discovery of the error), including payment to the United states of any additional Rebate Amount owed to it, interest thereon, and any penalty imposed under Section 1.148-3(h) of the Regulations. (i) Not to Divert Arbitraae Profits. Except to the extent permitted by section 148 of the Code and the Regulations and rulings thereunder, the City shall not, at any time prior to the earlier of the Stated Maturity or final payment of the Bonds, enter into any transaction that reduces the amount required to be paid to the united states pursuant to Subsection H of this Section because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction had been at arm's length and had the Yield of the Bonds not been relevant to either party. (j) Elections. The City hereby directs and authorizes the City Manager and Director of Finance and Human Resources, either or any combination of them, to make elections permitted or required pursuant to the provisions of the Code or the Regulations, as they deem necessary or appropriate in connection with the Bonds, in the Certificate as to Tax Exemption or similar or other appropriate certificate, form or document. (k) Bonds Not Hedae Bonds. (1) At the time the original bonds refunded by the Bonds were issued, the City reasonably expected to spend at least 85% of the spendable proceeds of such bonds within three years after such bonds were issued. (2) Not more than 50% of the proceeds of the original bonds refunded by the Bonds were invested in Nonpurpose Investments having a substantially guaranteed Yield for a period of 4 years or more. (1) Qualified Advance Refundinq. The Bonds are issued exclusively to refund the Refunded Obligations, and the Bonds will be issued more than 90 days before the redemption of the Refunded Obligations. The city represents as follows: 0108934 -31- (1) The Bonds are the first advance refunding of the Refunded obligations within the meaning of section 149(d) (3) of the Code. (2) The Refunded obligations are being called for redemption, and will be redeemed: (i) in the case of Refunded Obligations issued after 1985, not later than the earliest date on which such bonds may be redeemed and on which the City will realize present value debt service savings (determined without regard to administrative expenses) on the issue; and (ii) in the case of Refunded obligations issued before 1986, not later than the earliest date on which such issue may be redeemed at par or at a premium of 3 percent or less and on which the City will realize present value debt service savings (determined without regard to administrative expenses) on the issue. (3) The initial temporary period under section 148(c) of the Code will end: (i) with respect to the proceeds of the Bonds not later than 30 days after the date of issue of such Bonds; and (ii) with respect to proceeds of the Refunded Obligations on the Closing Date if not ended prior thereto. ( 4 ) On and after the date of issue of the Bonds, no proceeds of the Refunded Obligations will be invested in Nonpurpose Investments having a Yield in excess of the Yield on such Refunded obligations. (5) The Bonds are being issued for the purposes stated in the preamble of this Ordinance. There is a present value savings associated with the refunding. In the issuance of the Bonds the City has neither: (i) overburdened the tax-exempt bond market by issuing more bonds, issuing bonds earlier or allowing bonds to remain outstanding longer than reasonably necessary to accomplish the governmental purposes for which the Bonds were issued; (ii) employed on "abusive arbitrage device" within the meaning of Section 1.148-10(a) of the Regulations; nor (iii) employed a "device" to obtain a material financial advantage based on arbitrage, within the meaning of section 149(d) (4) of the Code, apart from savings attributable to lower interest rates and reduced debt service payments in early years. SECTION 28: Qualified Tax ExemDt Obliaations. In accordance with the provisions of paragraph (3) of subsection (b) of Section 265 of the Code, the City hereby designates the Bonds to be "qualified tax exempt obligations" in that the Bonds are not 0108934 -32- "private activity bonds" as defined in the Code and the reasonably anticipated amount of "qualified tax exempt obligations" to be issued by the city (including all subordinate entities of the city) for the calendar year in which the Bonds are issued will not exceed $10,000,000. SECTION 29: Sale of Bonds - Official Statement ADDroval. The sale of the Bonds authorized by this Ordinance to Rauscher pierce Refsnes, Inc. and NationsBanc Capital Markets, Inc. (herein refer- red to as the "Purchasers") at a special meeting of the Council held August 12, 1993, and pursuant to a Purchase Contract, dated August 12, 1993, attached hereto as Exhibit B and incorporated herein by reference as a part of this Ordinance for all purposes is hereby ratified, confirmed and approved in all respects, and such Purchase Contract, duly approved by the Council on August 12, 1993, and executed on behalf of the city by the Mayor Pro Tem is hereby ratified, confirmed and approved as a binding agreement in accordance with its terms. The Council hereby finds, determines and declares that the representations, warranties and agreements of the city (contained in paragraph 5 of said Purchase Contract) are true and correct in all material respects and shall be honored and performed by the city. Furthermore, the use of the Official Statement by the Purchasers in connection with the public offering and sale of the Bonds is hereby ratified, confirmed and approved in all respects. The final Official Statement, which reflects the terms of sale, attached as Exhibit A to the Purchase Contract (together with such changes approved by the Mayor, ci ty Secretary, ci ty Manager or Director of Finance and Human Resources, anyone or more of said officials), shall be and is hereby in all respects approved and the Purchasers are hereby authorized to use and distribute said final Official Statement, dated August 12, 1993, in the reoffering, sale and delivery of the Bonds to the public. The Mayor and City Secretary are further authorized and directed to manually execute and deliver for and on behalf of the city copies of said Official Statement in final form as may be required by the Purchasers, and such final Official Statement in the form and content manually executed by said officials shall be deemed to be approved by the City Council and constitute the Official Statement authorized for distribution and use by the Purchasers. SECTION 30: SDecial Escrow Aqreement ADDroval and Execution. The "Special Escrow Agreement" (the "Agreement") by and between the City and Ameritrust Texas National Association (the "Escrow Agent"), attached hereto as Exhibit C and incorporated herein by reference as a part of this Ordinance for all purposes, is hereby approved as to form and content, and such Agreement in substantially the form and substance attached hereto, together with such changes or revisions as may be necessary to accomplish the 0108934 -33- refunding or benefit the City, is hereby authorized to be executed by the Mayor or Mayor Pro Tem and City Secretary for and on behalf of the City and as the act and deed of this City Council; and such Agreement as executed by said officials shall be deemed approved by the City Council and constitute the Agreement herein approved. Furthermore, appropriate officials of the City in cooperation with the Escrow Agent are hereby authorized and directed to make the necessary arrangements for the purchase of the Federal Securities referenced in the Agreement and the delivery thereof to the Escrow Agent on the day of delivery of the Bonds to the Underwriters for deposit to the credit of the "SPECIAL CITY OF WYLIE, TEXAS, TAX AND REVENUE REFUNDING BOND ESCROW FUND" (the "Escrow Fund"); all as contemplated and provided in Article 717k, V.A.T.C.S., as amended, this Ordinance and the Agreement. SECTION 31: Control and Custodv of Bonds. The Mayor or Mayor Pro Tem of the City shall be and is hereby authorized to take and have charge of all necessary orders and records pending investigation by the Attorney General of the State of Texas, including the printing and supply of definitive Bonds, and shall take and have charge and control of the Initial Bonds pending the approval thereof by the Attorney General, the registration thereof by the Comptroller of Public Accounts and the delivery thereof to the Purchasers. Furthermore, the Mayor, Mayor Pro Tem, City Secretary, City Manager and Director of Finance and Human Resources, anyone or more of said officials, are hereby authorized and directed to furnish and execute such documents and certifications relating to the City and the issuance of the Bonds, including certifications as to facts, estimates, circumstances and reasonable expectations pertaining to the use, expenditure and investment of the proceeds of the Bonds, as may be necessary for the approval of the Attorney General, the registration by the comptroller of Public Accounts and the delivery of the Bonds to the Purchasers, and, together with the City's financial advisor, bond counsel and the Paying Agent/Registrar, make the necessary arrangements for the de~ivery of the Initial Bond(s) to the Purchasers and the initial exchange thereof for definitive Bonds. SECTION 32: Notices to Holders-Waiver. Wherever this Ordinance provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and sent by united States Mail, first class postage prepaid, to the address of each Holder appearing in the Security Register at the close of business on the business day next preceding the mailing of such notice. 0108934 -34- In any case where notice to Holders is given by mail, neither the failure to mail such notice to any particular Holders, nor any defect in any notice so mailed, shall affect the sufficiency of such notice with respect to all other Bonds. Where this Ordinance provides for notice in any manner, such notice may be waived in writing by the Holder entitled to receive such notice, either before or after the event with respect to which such notice is given, and such waiver shall be the equivalent of such notice. waivers of notice by Holders shall be filed with the paying Agent/Registrar, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. SECTION 33: Proceeds of Sale. Immediately following the delivery of the Bonds, the proceeds of sale thereof (less certain costs of issuance, and the accrued interest received from the Purchasers of the Bonds) shall be deposited with the Escrow Agent for application and disbursement in accordance with the provisions of the Agreement. The proceeds of sale of the Bonds not so deposited with the Escrow Agent for the refunding of the Refunded Obligations shall be disbursed and deposited for paYment of costs of issuance and deposited in the Bond Fund. SECTION 34: Cancellation. All Bonds surrendered for paYment, redemption, transfer, exchange, or replacement, if surrendered to the Paying Agent/Registrar, shall be promptly cancelled by it and, if surrendered to the City, shall be delivered to the paying Agent/Registrar and, if not already cancelled, shall be promptly cancelled by the Paying Agent/Registrar. The City may at any time deliver to the Paying Agent/Registrar for cancellation any Bonds previously certified or registered and delivered which the City may have acquired in any manner whatsoever, and all Bonds so delivered shall be promptly cancelled by the paying Agent/Registrar. All cancelled Bonds held by the Paying Agent/Registrar shall be returned to the City. SECTION 35: Leaal ODinion. The obligation of the Purchasers to accept delivery of the Bonds is subject to being furnished a final opinion of Fulbright & Jaworski L:L.P., Attorneys, Dallas, Texas, approving such Bonds as to their validity, said opinion to be dated and delivered as of the date of delivery and paYment for such Bonds. A true and correct reproduction of said opinion or an executed counterpart thereof is hereby authorized to be either printed on definitive printed obligations or deposited with DTC along with the global certificates for the implementation and use of the Book Entry Only system used in the settlement and transfer of the Bonds. SECTION 36: CUSIP Numbers. CUSIP numbers may be printed or typed on the definitive Bonds. It is expressly provided, however, that the presence or absence of CUSIP numbers on the definitive 0108934 -35- Bonds shall be of no significance or effect as regards the thereof and neither the City nor attorneys approving the to legality are to be held responsible for CUSIP incorrectly printed or typed on the definitive Bonds. legality Bonds as numbers SECTION 37: Benef its of Ordinance. Nothing in this Ordinance, expressed or implied, is intended or shall be construed to confer upon any person other than the City, the Paying Agent/Registrar and the Holders, any right, remedy, or claim, legal or equitable, under or by reason of this Ordinance or any provision hereof, this Ordinance and all its provisions being intended to be and being for the sole and exclusive benefit of the City, the Paying Agent/Registrar and the Holders. SECTION 38: Inconsistent Provisions. All ordinances, orders or resolutions, or parts thereof, which are in conflict or inconsistent wi th any provision of this Ordinance are hereby repealed to the extent of such conflict, and the provisions of this Ordinance shall be and remain controlling as to the matters contained herein. SECTION 39: Governina Law. This Ordinance shall be construed and enforced in accordance with the laws of the State of Texas and the United States of America. SECTION 40: Effect of Headings. herein are for convenience only and construction hereof. The shall section headings not affect the SECTION 41: Construction of Terms. If appropriate in the context of this Ordinance, words of the singular number shall be considered to include the plural, words of the plural number shall be considered to include the singular, and words of the masculine, feminine or neuter gender shall be considered to include the other genders. SECTION 42: Severability. If any provision of this Ordinance or the application thereof to any circumstance shail be held to be invalid, the remainder of this Ordinance and the application thereof to other circumstances shall nevertheless be valid, and the City Council hereby declares that this Ordinance would have been enacted without such invalid provision. SECTION 43: IncorDoration of Findinas and Determinations. The findings and determinations of the City Council contained in the preamble hereof are hereby incorporated by reference and made a part of this Ordinance for all purposes as if the same were restated in full in this section. 0108934 -36- SECTION 44: Insurance. The Bonds have been offered and sold with the principal of and interest thereon being insured by AMBAC Indemnity Corporation (hereinafter called "AMBAC") pursuant to a Municipal Bond Guaranty Insurance Policy. In accordance with the terms and conditions applicable to insurance provided by AMBAC, the city covenants and agrees that, in the event the principal and interest due on the Bonds shall be paid by AMBAC pursuant to the policy referred to this Section, the assignment and pledge of all funds and all covenants, agreements and other obligations of the City to the Holders shall continue to exist and AMBAC shall be subrogated to the rights of such Holders; and furthermore, the City covenants and agrees that: (a) Consent of AMBAC where Holder Consent Reauired. AMBAC shall be deemed to be the holder of the Bonds insured by AMBAC at all times for the purpose of the execution and delivery of any amendment, change or modification of this Ordinance or the initiation by Holders of any action to be taken under this Ordinance at the Holder's request, which under this Ordinance (or under such underlying documents requires the written approval or consent of or can be initiated by the Holders of a majority (50% percent) in aggregate principal amount of the Bonds at the time Outstanding. (b) Defeasance. In the event that the principal and redemption price, if applicable, and interest due on the Bonds shall be paid by AMBAC pursuant to the policy referred to in this Section, all covenants, agreements and other obligations of the City to the Holders shall continue to exist and AMBAC shall be subrogated to the rights of such Holders. (c) Notices to be Given to AMBAC. While the Municipal Bond Guaranty Insurance Policy is in effect, the City shall furnish to AMBAC: ( 1) as soon as practicable filing thereof, a copy of any statement of the City and a copy of and annual report of the city; after the financial any audit (2) a copy of any notice to be given to the registered owners of the Bonds, including, without limitation, notice of any redemption or defeasance of Bonds, and any certificate rendered pursuant to this Ordinance relating to the security for the Bonds; and 0108934 -37- 0108934 (3) such additional information as it may reasonably request. The City will permit AMBAC to discuss the affairs, finances and accounts of the City, or any information AMBAC may reasonably request regarding the security for the Bonds with appropriate officers of the city. The City will permit AMBAC to have access to and make copies of all books and records relating to the Bonds at any reasonable time. (d) Consent of AMBAC. Any provision of this Ordinance expressly recognizing or granting rights in or to AMBAC may not be amended in any manner which affects the rights of AMBAC hereunder without the prior written consent of AMBAC. Furthermore, anything in this Ordinance to the contrary notwi thstanding , upon the occurrence and continuance of an event of default, AMBAC shall be entitled to control and direct the enforcement of all rights and remedies granted to the Holders of the Bonds for the benefit of such Holders. (e) Concerninq the Bond Insurance Policy. As long as insurance for the Bonds shall be in full force and effect, the City agrees to comply with the following provisions: (1) if five (5) days prior to an interest payment date for the Bonds the City determines that there will be insufficient funds in the Interest and Sinking Fund to pay the principal of or interest on the Bonds on such interest payment date, the City shall so notify AMBAC. Such notice shall specify the amount of the anticipated deficiency, the Bonds to which such deficiency is applicable and whether such Bonds will be deficient as to principal or interest, or both. (2) the City shall, after giving notice to AMBAC as provided in (1) above, make available to AMBAC and the united States Trust Company of New York, as insurance trustee for AMBAC, the registration books of the City maintained by the Paying Agent/Registrar, and all records relating to the funds and accounts maintained under this Ordinance. (3) the city shall cause the Paying Agent/Registrar to provide AMBAC and the -38- 0108934 United states Trust Company of New York with a list of registered owners of Bonds entitled to receive principal or interest paYments from AMBAC under the terms of the Municipal Bond Insurance POlicy, and shall cause the Paying Agent/Registrar to make arrangements with united states Trust Company of New York (i) to mail checks or drafts to the registered owners of Bonds entitled to receive full or partial interest paYments from AMBAC, and (ii) to pay principal upon Bonds surrendered to united states Trust Company of New York by the registered owners of Bonds entitled to receive full or partial principal payments from AMBAC. (4) the city shall cause the Paying Agent/Registrar to notify, at the time it provides notice to AMBAC pursuant to (1) above, the registered owners of Bonds entitled to receive the payment of principal or interest thereon from AMBAC (i) as to the fact of such entitlement, (ii) that AMBAC will remit to them all or a part of the interest paYments next coming due, (iii) that should they be entitled to receive full paYment of principal from AMBAC they must tender their Bonds (along with a form of transfer of title thereto) for paYment to united states Trust Company of New York, as insurance trustee for AMBAC, and not the Paying Agent/Registrar, and (iv) that should they be entitled to receive partial paYment of principal from AMBAC they must tender their Bonds for paYment thereon first to the Paying Agent/Registrar, who shall note on such Bonds the portion of the principal paid by the Paying Agent/Registrar, and then, along with a form of transfer of title thereto, to AMBAC, which will then pay the unpaid portion of principal. (5) AMBAC shall, to the extent it makes a paYment of principal of or interest on Bonds, become subrogated to the rights of the recipients of such payments in accordance with the terms of the Municipal Bond Insurance POlicy, and to evidence such sUbrogation (i) in the case of subrogation as to claims for past due interest, the City shall cause the Paying Agent/Registrar to note AMBAC's rights as subrogee on the registration books of the -39- city maintained by the Paying Agent/Registrar upon receipt from AMBAC of proof of the paYment of interest thereon to the registered owners of the Bonds, and (ii) in the case of subrogation as to claims for past due principal, the City shall cause the Paying Agent/Registrar to note AMBAC's rights as subrogee on the registration books of the city maintained by the Paying Agent/ Registrar upon surrender of the Bonds by the registered owners thereof together with proof of the paYment of principal thereof. SECTION 45: Public Meeting. It is officially found, determined, and declared that the meeting at which this Ordinance is adopted was open to the public and public notice of the time, place, and subject matter of the public business to be considered at such meeting, including this Ordinance, was given, all as required by Article 6252-17, Vernon's Texas civil Statutes, as amended. SECTION 46: Effective Date. This Ordinance shall take effect and be in force immediately from and after its passage, and it is so ordained. PASSED AND ADOPTED, this August 19, 1993. CITf OF WYLIE, T~S /r//ffJ/1 I!({/(;;:f 0ayor Pro Tem .J ATTEST: l(!ftJ!~ (city Seal) 0108934 -40- .1...& .j,~)~,\J II lit.,' .. \ ' , '-' ' I, ... PAYING AGENT/REGISTRAR AGREEMENT THIS AGREEMENT entered into as of August 19, 1993 (this "Agreement"), by and between the City of Wylie, Texas (the "Issuer"), and Ameritrust Texas National Association, a banking association duly organized and existing under the laws of the united States of America, (the "Bank"). RECITALS WHEREAS, the Issuer has duly authorized and provided for the execution and delivery of its "City of Wylie, Texas, Tax and Waterworks and Sewer System Surplus Revenue Refunding Bonds, Series 1993" (the "securities"), dated August 1, 1993, such Securities to be issued in fully registered form only as to the payment of principal and interest thereon; and WHEREAS, the Securities are scheduled to be delivered to the initial purchasers thereof on or about September 14, 1993; and WHEREAS, the Issuer has selected the Bank to serve as paying Agent/Registrar in connection with the payment of the principal of, premium, if any, and interest on said Securities and with respect to the registration, transfer and exchange thereof by the registered owners thereof; and WHEREAS, the Bank has agreed to serve in such capacities for and on behalf of the Issuer and has full power and authority to perform and serve as paying Agent/Registrar for the Securities; NOW, THEREFORE, it is mutually agreed as follows: ARTICLE ONE APPOINTMENT OF BANK AS PAYING AGENT AND REGISTRAR Section 1.01. ADDointment. The Issuer hereby appoints the Bank to serve as paying Agent with respect to the Securities, and, as Paying Agent for the Securities, the Bank shall be responsible for paying on behalf of the Issuer the principal, premium (if any), and interest on the Securities as the same become due and payable to the registered owners thereof; all in accordance with this Agreement and the "Bond Resolution" (hereinafter defined). The Issuer hereby appoints the Bank as Registrar with respect to the Securities and, as Registrar for the Securities, the Bank shall keep and maintain 0109004 for and on behalf of the Issuer books and records as to the ownership of said Securities and with respect to the transfer and exchange thereof as provided herein and in the "Bond Resolution". The Bank hereby accepts its appointment, and agrees to serve as the Paying Agent and Registrar for the Securities. Section 1.02. ComDensation. As compensation for the Bank's services as Paying Agent/Registrar, the Issuer hereby agrees to pay the Bank the fees and amounts set forth in Annex A attached hereto. In addition, the Issuer agrees to reimburse the Bank upon its request for all reasonable expenses, disbursements and advances incurred or made by the Bank in accordance with any of the provisions hereof (including the reasonable compensation and the expenses and disbursements of its agents and counsel) . ARTICLE TWO DEFINITIONS Section 2.01. Definitions. For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires: "Acceleration Date" on any Security means the date on and after which the principal or any or all installments of interest, or both, are due and payable on any Security which has become accelerated pursuant to the terms of the Security. "Bank Office" means the principal offices of located at the address appearing on page 12 hereof. will notify the Issuer in writing of any change in of the Bank Office. the Bank The Bank location "Bond Resolution" means the resolution, order, or ordinance of the governing body of the Issuer pursuant to which the Securities are issued, certified by the Secretary or any other officer of the Issuer and delivered to the Bank. "Fiscal Year" means the fiscal year of the Issuer, ending September 30th. 0109004 -2- EXHIBIT A 0109004 "Holder" and "Security Holder" each means the Person in whose name a Security is registered in the Security Register. "Issuer Request" and "Issuer Order" means a written request or order signed in the name of the Issuer by the Mayor, City Secretary, City Manager, or Director of Finance and Human Resources, anyone or more of said officials, and delivered to the Bank. "Legal Holiday" means a day on which the Bank is required or authorized to be closed. "Person" means any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political sUbdivision of a government. "Predecessor Securities" of any particular Security means every previous Security evidencing all or a portion of the same obligation as that evidenced by such particular Security (and, for the purposes of this definition, any mutilated, lost, destroyed, or stolen Security for which a replacement Security has been registered and delivered in lieu thereof pursuant to section 4.06 hereof and the Resolution). "Redemption Date" when used with respect to any Security to be redeemed means the date fixed for such redemption pursuant to the terms of the Bond Resolution. "Responsible Officer" when used with respect to the Bank means the Chairman or Vice-Chairman of the Board of Directors, the Chairman or Vice-Chairman of the Executive Committee of the Board of Directors, the President, any Vice President, the Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any Assistant Cashier, any Trust Officer or Assistant Trust Officer, or any other officer of the Bank customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any o~her officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject. "Security Register" means a register maintained by the Bank on behalf of the Issuer providing for the registration and transfers of Securities. -3- ~:Yd\RIT ,~' L / \~. ..,1 "Stated Maturity" means the date specified in the Bond Resolution the principal of a Security is scheduled to be due and payable. Section 2.02. Other Definitions. The terms "Bank," "Issuer," and "Securities (Security)" have the meanings assigned to them in the recital paragraphs of this Agreement. The term "Paying Agent/Registrar" refers to the Bank in the performance of the duties and functions of this Agreement. ARTICLE THREE PAYING AGENT Section 3.01. Duties of pavina Aaent. As paying Agent, the Bank shall, provided adequate collected funds have been provided to it for such purpose by or on behalf of the Issuer, pay on behalf of the Issuer the principal of each Security at its Stated Maturity, Redemption Date, or Acceleration Date, to the Holder upon surrender of the Security to the Bank Office. As Paying Agent, the Bank shall, provided adequate collected funds have been provided to it for such purpose by or on behalf of the Issuer, pay on behalf of the Issuer the interest on each Security when due, by computing the amount of interest to be paid each Holder and making payment thereof to the Holders of the Securities (or their Predecessor Securities) on the Record Date. All payments of principal and/or interest on the Securities to the registered owners shall be accomplished (1) by the issuance of checks, payable to the registered owners, drawn on the fiduciary account provided in Section 5.05 hereof, sent by United States mail, first class, postage prepaid, to the address appearing on the Security Register or (2) by such other method, acceptable to the Bank, requested in writing by the Holder at the Holder's risk and expense. Section 3.02. Payment Dates. The Issuer hereby instructs the Bank to pay the principal of and interest on the Securities at the dates specified in the Bond Resolution. 0109004 -4- EXHIBIT A ARTICLE FOUR REGISTRAR section 4.01. Securitv Reaister - Transfers and Exchanges. The Bank agrees to keep and maintain for and on behalf of the Issuer at the Bank Office books and records (herein sometimes referred to as the "Security Register") for recording the names and addresses of the Holders of the Securities, the transfer, exchange and replacement of the Securities and the payment of the principal of and interest on the Securities to the Holders and containing such other information as may be reasonably required by the Issuer and subject to such reasonable regulations as the Issuer and Bank may prescribe. All transfers, exchanges and replacement of Securities shall be noted in the Security Register. Every Security surrendered for transfer or exchange shall be duly endorsed or be accompanied by a written instrument of transfer, the signature on which has been guaranteed by an officer of a federal or state bank or a member of the National Association of Securities Dealers, in form satisfactory' to the Bank, duly executed by the Holder thereof or his agent duly authorized in writing. The Bank may request any supporting documentation it feels necessary to effect a re-registration, transfer or exchange of the Securities. To the extent possible and under reasonable circumstances, the Bank agrees that, in relation to an exchange or transfer of Securities, the exchange or transfer by the Holders thereof will be completed and new Securities delivered to the Holder or the assignee of the Holder in not more than three (3) business days after the receipt of the Securities to be cancelled in an exchange or transfer and the written instrument of transfer or request for exchange duly executed by the Holder, or his duly authorized agent, in form and manner satisfactory to the paying Agent/Registrar. Section 4.02. Certifipates. The Issuer shall provide an adequate inventory of printed Securities to facilitate transfers or exchanges thereof. The Bank covenants that the inventory of printed Securities will be kept in safekeeping pending their use and reasonable care will be exercised by the Bank in maintaining such Securities in safekeeping, which shall be not less than the care maintained by the Bank for debt securities of other governments or corporations 0109004 -5- EXHIB! T '~ for which it serves as registrar, or that is maintained for its own securities. Section 4.03. Form of Securitv Reaister. The Bank, as Registrar, will maintain the Security Register relating to the registration, payment, transfer and exchange of the Securities in accordance with the Bank's general practices and procedures in effect from time to time. The Bank shall not be obligated to maintain such Security Register in any form other than those which the Bank has currently available and currently utilizes at the time. The Security Register may be maintained in written form or in any other form capable of being converted into written form within a reasonable time. Section 4.04. List of Security Holders. The Bank will provide the Issuer at any time requested by the Issuer, upon payment of the required fee, a copy of the information contained in the Security Register. The Issuer may also inspect the information contained in the Security Register at any time the Bank is customarily open for business, provided that reasonable time is allowed the Bank to provide an up-to-date listing or to convert the information into written form. The Bank will not release or disclose the contents of the Security Register to any person other than to, or at the written request of, an authorized officer or employee of the Issuer, except upon receipt of a court order or as otherwise required by law. Upon receipt of a court order and prior to the release or disclosure of the contents of the Security Register, the Bank will notify the Issuer so that the Issuer may contest the court order or such release or disclosure of the contents of the Security Register. Section 4.05. Return of Cancelled Certificates. The Bank will, at such reasonable intervals as it determines, surrender to the Issuer, Securities in lieu of which or in exchange for which other Securities have been issued, or which have been paid. Section 4.06. Mutilated. Destroved. Lost or Stolen Securi- ties. The Issuer hereby instructs the Bank, subject to the provisions of Section 24 of the Bond Resolution, to deliver and issue Securities in exchange for or in lieu of mutilated, 0109004 -6- ~} iQ'T <~ destroyed, lost, or stolen Securities as long as the same does not result in an overissuance. In case any Security shall be mutilated, or destroyed, lost or stolen, the Bank may execute and deliver a replacement Security of like form and tenor, and in the same denomination and bearing a number not contemporaneously outstanding, in exchange and substitution for such mutilated Security, or in lieu of and in substitution for such destroyed, lost or stolen Security, only upon the approval of the Issuer and after (i) the filing by the Holder thereof with the Bank of evidence satisfactory to the Bank of the destruction, loss or theft of such Security, and of the authenticity of the ownership thereof and (ii) the furnishing to the Bank of indemnification in an amount satisfactory to hold the Issuer and the Bank harmless. All expenses and charges associated with such indemnity and with the preparation, execution and delivery of a replacement Security shall be borne by the Holder of the security mutilated, or destroyed, lost or stolen. Section 4.07. Transaction Information to Issuer. The Bank will, within a reasonable time after receipt of written request from the Issuer, furnish the Issuer information as to the Securities it has paid pursuant to Section 3.01, Securities it has delivered upon the transfer or exchange of any Securities pursuant to Section 4.01, and Securities it has delivered in exchange for or in lieu of mutilated, destroyed, lost, or stolen Securities pursuant to Section 4.06. ARTICLE FIVE THE BANK Section 5.01. Duties of Bank. The Bank undertakes to perform the duties set forth herein and agrees to use reasonable care in the performance thereof. Section 5.02. Reliance on Documents. Etc. (a) The Bank may conclusively rely, as to the truth of the statements and correctness of the opinions expressed therein, on certificates or opinions furnished to the Bank. (b) The Bank shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Bank was negligent in ascertaining the pertinent facts. (c) No provls~ons of this Agreement shall require the Bank to expend or risk its own funds or otherwise incur any financial 0109004 -7- EXHIBIT A liability for performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity satisfactory to it against such risks or liability is not assured to it. (d) The Bank may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note, security, or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. Without limiting the generality of the foregoing statement, the Bank need not examine the ownership of any Securities, but is protected in acting upon receipt of Securities containing an endorsement or instruction of transfer or power of transfer which appears on its face to be signed by the Holder or an agent of the Holder. The Bank shall not be bound to make any investigation into the facts or matters stated in a resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note, security, or other paper or document supplied by Issuer. (e) The Bank may consult with counsel, and the written advice of such counselor any opinion of counsel shall be full and complete authorization and protection with re~pect to any action taken, suffered, or omitted by it hereunder in good faith and in reliance thereon. (f) The Bank may exercise any of the powers hereunder and perform any duties hereunder either directly or by or through agents or attorneys of the Bank. Section 5.03. Recitals of Issuer. The recitals contained herein with respect to the Issuer and in the Securities shall be taken as the statements of the Issuer, and the Bank assumes no responsibility for their correctness. The Bank shall in no event be liable to the Issuer, any Holder or Holders of any Security, or any other Person for any amount due on any Security from its own funds. Section 5.04. Mav Hold Securities. The Bank, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with the Issuer with the same rights it would have if it were not the Paying Agent/Registrar, or any other agent. 0109004 -8- EXHIBIT A "':'i 1 Section 5.05. Monevs Collateralization. Held bv Bank - Fiduciarv Account/ A fiduciary account shall at all times be kept and maintained by the Bank for the receipt, safekeeping and disbursement of moneys received from the Issuer hereunder for the payment of the Securities, and money deposited to the credit of such account until paid to the Holders of the Securities shall 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 to secure and be pledged as collateral for fiduciary accounts to the extent such money is not insured by the Federal Deposit Insurance Corporation. Payments made from such fiduciary account shall be made by check drawn on such fiduciary account unless the owner of such Securities shall, at its own expense and risk, request such other medium of payment. The Bank shall be under no liability for interest on any money received by it hereunder. SUbject to the applicable unclaimed property laws of the State of Texas, any money deposited with the Bank for the payment of the principal, premium (if any), or interest on any Security and remaining unclaimed for four years after final maturity of the Security has become due and payable will be paid by the Bank to the Issuer, and the Holder of such Security shall thereafter look only to the Issuer for payment thereof, and all.liability of the Bank with respect to such moneys shall thereupon cease. section 5.06. Indemnification. To the extent permi tted by law, the Issuer agrees to indemnify the Bank for, and hold it harmless against, any loss, liability, or expense incurred without negligence or bad faith on its part, arising out of or in connection with its acceptance or administration of its duties hereunder, including the cost and expense against any claim or liability in connection with the exercise or performance of any of its powers or duties under this Agreement. Section 5.07. InterDleader. The Issuer and the Bank agree that the Bank may seek adjudication of any adverse claim, demand, or controversy over its person as well as funds on deposit, in either a Federal or State District Court located in the State and County where either the Bank Office or the administrative offices of the Issuer is located, and agree that service of process by certified or registered mail, return receipt requested, to the address referred to in Section 6.03 of this Agreement shall constitute adequate 0109004 -9- ! t~~! service. The Issuer and the Bank further agree that the Bank has the right to file a Bill of Interpleader in any court of competent jurisdiction to determine the rights of any Person claiming any interest herein. Section 5.08. DT Services. It is hereby represented and warranted that, in the event the Securities are otherwise qualified and accepted for "Depository Trust Company" services or equivalent depository trust services by other organizations, the Bank has the capability and, to the extent within its control, will comply with the "Operational Arrangements", effective August 1, 1987, which establishes requirements for securities to be eligible for such type depository trust services, including, but not limited to, requirements for the timeliness of payments and funds availability, transfer turnaround time, and notification of redemptions.and calls. ARTICLE SIX MISCELLANEOUS PROVISIONS Section 6.01. Amendment. This Agreement may be amended only by an agreement in writing signed by both of the parties hereto. Section 6.02. Assianment. This Agreement may not be assigned by either party without the prior written consent of the other. Section 6.03. Notices. Any request, demand, authorization, direction, notice, consent, waiver, or other document provided or permitted hereby to be given or furnished to the Issuer or the Bank shall be mailed or delivered to the Issuer or the Bank, respectively, at the addresses shown on page 12. Section 6.04. Effect of Headinas. The Article and Section headings herein are for convenience only and shall not affect the construction hereof. Section 6.05. Successors and Assians. All covenants and agreements herein by the Issuer shall bind its successors and assigns,. whether so expressed or not. 0109004 -10- h~HIBIT ,A section 6.06. Severability. In case any provision herein shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. Section 6.07. Benefits of Aareement. Nothing herein, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, any benefit or any legal or equitable right, remedy, or claim hereunder. section 6.08. Entire Agreement. This Agreement and the Bond Resolution constitute the entire agreement between the parties hereto relative to the Bank acting as Paying Agent/Registrar and if any conflict exists between this Agreement and the Bond Resolution, the Bond Resolution shall govern. section 6.09. CounterDarts. This Agreement may be executed in any number of counterparts~ each of which shall be deemed an original and all of which shall constitute one and the same Agreement. Section 6.10. Termination. This Agreement will terminate (i) on the date of final payment of the principal of and interest on the Securities to the Holders thereof or (ii) may be earlier terminated by either party upon sixty (60) days written notice; provided, however, an early termination of this Agreement by either party shall not be effective until (a) a successor paying Agent/Registrar has been appointed by the Issuer and such appointment accepted and (b) notice given to the Holders of the Securities of the appointment of a succe~sor Paying Agent/Registrar. Furthermore, the Bank and Issuer mutually agree that the effective date of an early termination of this Agreement shall not occur at any time which would disrupt, delay or otherwise adversely affect the payment of the Securities. Upon an early termination of this Agreement, the Bank agrees to promptly transfer and deliver the Security Register (or a copy thereof), together with other pertinent books and records relating to the Securities, to the successor Paying Agent/Registrar designated and appointed by the Issuer. 0109004 -11- EXHIBIT A The provisions of section 1.02 and of Article Five shall survive and remain in full force and effect following the termination of this Agreement. section 6.11. Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the state of Texas. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. AMERITRUST ASSOCIATION TEXAS NATIONAL BY Title: [SEAL] Attest: Address: P. o. Box 2320 Dallas, TX 75221-2320 Title: CITY OF WYLIE, TEXAS BY Mayor Pro Tem (CITY SEAL) Attest: Address: 2000 Highway 78 North Wylie, Texas 75098 City Secretary 0109004 -12- EYJnPfT A c\J,HIBIT B ~J. $5,890,000 CITY OF WYLIE, TEXAS Combination Tax and Revenue Refunding Bonds Series 1993 PURCHASE CONTRAcr August 12, 1993 The Honorable Mayor Pro Tern and Members of the City Council City of Wylie 2000 Highway 78 North Wylie, Texas 75098 Dear Mayor Pro Tern and Members of the City Council: Rauscher Pierce Refsnes, Inc. and NationsBanc Capital Markets, Inc. (collectively, the "Underwriters"), offer to enter into this Purchase Contract with the City of Wylie, Texas (the "City"). This offer is made subject to the City's acceptance of this Purchase Contract on or before 9:00 p.m. Central Time on August 12, 1993. 1. Purchase and Sale of the Bonds. Upon the terms and conditions and upon the basis of the representations set forth herein, the Underwriter hereby agrees, jointly and severally, to purchase from the City, and the City hereby agrees to sell and deliver to the Underwriter an aggregate of $5,890,000 principal amount of City of Wylie, Combination Tax and Revenue Refunding Bonds, Series 1993 (the "Bonds"). The Bonds shall have the dated date, the maturities and bear interest from the date at the rate or rates per annum as shown in the Official Statement (hereinafter defined), such interest being payable as shown in the Official S~t~ment. The purchase price for the Bonds shall be $5,803,730.75 (representing the principal amount of the Bonds, less an Underwriter's discount on the Bonds of $49,476.00 and less original issue discount on the Bonds in the amount of $36,793.25) plus accrued interest on the Bonds from their date to the date of the payment for and delivery of the Bonds (the "Closing"). 2. Ordinance. The Bonds shall be as described in and shall be issued and secured under the provisions of the Ordinance authorizing the issuance and sale of the Bonds to be approved by the City Council on August 19, 1993 (the "Ordinance"). The Bonds shall be secured and payable as provided in the Ordinance. 3. Public Offering. It shall be a condition of the obligations of the City to sell and deliver the Bonds to the Underwriter, and of the obligations of the Underwriter to purchase and accept delivery of the Bonds, that the entire principal amount of the Bonds authorized by the Ordinance shall be sold and delivered by the City and accepted and paid for by the Underwriter at the Closing. The Underwriter agrees to make a bona fide public offering of all of the Bonds, at not in excess of the initial public offering prices, as set forth in the Official Statement, plus interest accrued on the Bonds from the date of the Bonds. 4. Security Deposit. Delivered to the City herewith is a corporate check of Rauscher Pierce Refsnes, Inc. payable to the order of the City in the amount of one percent (1%) of the principal amount of the Bonds. The City agrees to hold such check uncashed until the Closing to ensure the performance by the Underwriter of its obligation to purchase, accept delivery of and pay for the Bonds at the Closing. Concurrently with the payment by the Underwriter of the purchase price of the Bonds, the City shall return such check to Rauscher Pierce Refsnes, Ine. as provided in Paragraphs 7 and 8 hereof. Should the City fail to deliver the Bonds at the Closing, or should the City be unable to satisfy the conditions of the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds, as set forth in this Purchase Contract (unless waived by the Underwriter), or should such obligations of the Underwriter be terminated for any reason permitted by this Purchase Contract, such check shall immediately be returned to Rauscher Pierce Refsnes, Ine. In the event the Underwriter fails (other than for a reason permitted hereunder) to purchase, accept delivery of and pay for the Bonds at the Closing as herein provided, such check shall be retained by the City as and for full liquidated damages for such failure of the Underwriter and for any defaults hereunder on the part of the Underwriter. Rauscher Pierce Refsnes, Ine. hereby agrees not to stop or cause payment on said check to be stopped unless the City has breached any of the terms of this Purchase Contract. 5. Official Statement. Exhibit A hereto is the Official Statement, including the cover pages and Appendices thereto, of the City, dated August 12, 1993 with respect to the Bonds. The Official Statement, including the cover pages and Appendices thereto, as further amended only in the manner herein provided, is hereinafter called the "Official Statement." The City hereby authorizes the Escrow Agreement, hereinafter defined, the Ordinance and the Official Statement and the information therein contained to be used by the Underwriter in connection with the public offering and sale of the Bonds. The City confirms its consent to the use by the Underwriter prior to the date hereof of the Preliminary Official Statement, relative to the Bonds, dated July 23, 1993 (the "Preliminary Official Statement"), in connection with the preliminary public offering and sale of the Bonds, and it is "deemed final" as of its date, within the meaning, and for the purposes, of Rule 15c2- 12 promulgated under authority granted by the federal Securities and Exchange Act of 1934 (the "Rule"). The City agrees to cooperate with the Underwriter to provide a supply of final Official Statements within seven business days of the date hereof in sufficient quantities to comply with the Underwriter's obligations under the Rule and the applicable rules of the Municipal Securities Rulemaking Board. The Underwriter will use its best efforts to assist the City in the preparation of the final Official Statement in order to ensure compliance with the aforementioned rules. If at any time after the date of this Purchase Contract but before the first to occur of (i) the date upon which the Underwriter notifies the City that the period of the initial public offering of the Bonds has expired or (ii) the date that is 90 days after the date hereof, any event shall occur which might or would cause the Official Statement to contain any untrue statement of a material fact or to omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the City shall notify the Underwriter and, if in the opinion of the Underwriter such event requires the preparation and publication of a supplement or amendment to the Official Statement, the City will at its expense supplement or amend the Official Statement in the form and in a manner approved by the Underwriter and furnish to the Underwriter a reasonable number of copies requested by the Underwriter in order to enable the Underwriter to comply with the Rule. 6. Representations, Warranties and Agreements or the City. On the date hereof, the City represents, warrants and agrees as follows: (a) The City is a home rule municipality and a political subdivision of the State of Texas and a body politic and corporate, and has full legal right, power and authority to enter into this Purchase Contract and the Escrow Agreement pertaining to the Bonds by and between the City and the Escrow Agent named therein (the "Escrow Agreement"), to adopt the Ordinance, to sell the Bonds, and to issue and deliver the Bonds to the Underwriter as provided herein and to carry out and consummate all other transactions contemplated by the Ordinance, the Escrow Agreement and this Purchase Contract; 2 EXHIBIT B '"' (b) By official action of the City, the City covenants to duly adopt the Ordinance which authorizes and approves the execution and delivery of, and the performance by the City of the obligations contained in, this Purchase Contract, the Bonds, the Escrow Agreement and the Ordinance, and authorizes and approves the Official Statement and the use of the Preliminary Official Statement in the offering of the Bonds by the Underwriters; (c) The City is not in breach of or default under any applicable law or administrative regulation of the State of Texas or the United States (including regulations of its agencies) or any applicable judgment or decree or any loan agreement, note, order, agreement or other instrument, except as may be disclosed in the Official Statement, to which the City is a party or, to its knowledge, is otherwise subject, which would have a material and adverse effect upon the business or financial condition of the City; and the execution and delivery this Purchase Contract and the Escrow Agreement by the City and the execution and delivery of the Bonds and the adoption of the Ordinance by the City and compliance with the provisions of each thereof will not violate or constitute a breach of or default under any existing law, administrative regulation, judgment, decree or any agreement or other instrument to which the City is a party or, to the knowledge of the City, is otherwise subject; (d) All approvals, consents and orders of any governmental authority or agency having jurisdiction of any matter which would constitute a condition precedent to the performance by the City of its obligations to sell and deliver the Bonds hereunder will have been obtained prior to the Closing; (e) At the time of the City's acceptance hereof and at the time of the aosing, the Official Statement does not and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (1) Between the date of this Purchase Contract and the Closing, the City will not, without the prior written consent of the Underwriter, issue any additional bonds, notes or other obligations for borrowed money payable in whole or in part from ad valorem taxes of the City, nor will there be any adverse change of a material nature in the financial position of the City; (g) Except as described in the Official Statement, no litigation is pending or, to the knowledge of the City, threatened in any court affecting the corporate existence of the City, the title of its officers to their respective offices, or seeking to restrain or enjoin the issuance or delivery of the Bonds, the collection or application of the taxes and revenues pledged or to be pledged to pay the principal of and interest on the Bonds, or in any way contesting or affecting the issuance, execution, delivery, payment, security or validity of the Bonds, or in any way contesting or affecting the validity or enforceability of the Ordinance, the Escrow Agreement or this Purchase Contract, or contesting the powers of the City, or any authority for the Bonds, the Escrow Agreement, the Ordinance or this Purchase Contract or contesting in any way the completeness, accuracy or fairness of the Preliminary Official Statement or the Official Statement; (h) The City will cooperate with the Underwriter in arranging for the qualification of the Bonds for sale and the determination of their eligibility for investment under the laws of such jurisdictions as the Underwriter designates, and will use its best efforts to continue such qualifications in effect so long as required for distribution of the Bonds; provided, however, that the City will not be required to execute a general consent to service of process or to qualify to do business in connection with any such qualification in any jurisdiction; (i) The descriptions of the Bonds, the Escrow Agreement and the Ordinance contained in the Official Statement accurately summarize certain provisions of such instruments, and the Bonds, when validly executed, authenticated and delivered in accordance with the Ordinance and sold to the 3 EXHIBll B Undetwriter as provided herein, will be validly issued and outstanding obligations of the City entitled to the benefits of, and subject to the limitations contained in, the Ordinance; G) If prior to the Closing an event occurs affecting the City which is materially adverse for the purpose for which the Official Statement is to be used and is not disclosed in the Official Statement, the City shall notify the Undetwriter, and if in the opinion of the City and the Undetwriter such event requires a supplement or amendment to the Official Statement, the City will supplement or amend the Official Statement in a form and in a manner approved by the Undetwriter; and (k) The financial statements contained in the Official Statement present fairly the financial position of the City as of the date and for the period covered thereby and are stated on a basis substantially consistent with that of the prior year's audited financial statements. 7. Closing. At 10:00 a.m., Central Time, on September 14, 1993 (the wClosingW), the City will deliver the initial bond or bonds (as defined in the Ordinance) to the Undetwriter and, provided the Undetwriter shall have made arrangements with The Depository Trust Company eDTC'} for the Bonds to be immobilized and thereafter traded as book-entry only bonds, the City shall take appropriate steps to provide DTC with one definite bond for each year or maturity of the Bonds, and to provide the Undetwriter with the other documents hereinafter mentioned, and the Undetwriter will accept such delivery and pay the purchase price of the Bonds as set fonh in Paragraph 1 hereof in immediately available funds. Concurrently with such payment by the Undetwriter, the City shall return to Rauscher Pierce Refsnes, Ine. the check referred to in paragraph 4 hereof. Delivery and payment as aforesaid shall be made at the office of Fulbright & Jaworski L.L.P., 2200 Ross Avenue, Suite 2800, Dallas, Texas 75201, or such other place, as shall have been mutually agreed upon by the City and the Undetwriter. 8. Conditions. The Undetwriter has entered into this Purchase Contract in reliance upon the representations and warranties of the City contained herein and to be contained in the documents and instruments to be delivered at the Closing, and upon the performance by the City of its obligations hereunder, both as of the date hereof and as of the date of Closing. Accordingly, the Undetwriter's obligations under this Purchase Contract to purchase and pay for the Bonds shall be subject to the performance by the City of its obligations to be performed hereunder and under such documents and instruments at or prior to the Closing, and shall also be subject to the following conditions: (a) The representations and warranties of the City contained herein shall be true, complete and correct in all material respects on the date hereof and on and as of the date of Closing, as if made on the date of Qosing; (b) At the time of the Closing, the Ordinance shall be in full force and effect, and the Ordinance and the Escrow Agreement shall not have been amended, modified or supplemented and the Official Statement shall not have been amended, modified or supplemented, except as may have been agreed to by the Undetwriter; (c) At the time of the Closing, all official action of the City related to the Ordinance shall be in full force and effect and shall not have been amended, modified or supplemented; (d) The City shall not have failed to pay principai or interest when due on any of its outstanding obligations for borrowed money; (e) The City will purchase or cause to be purchased the Federal Securities (as defined in the Official Statement) as may be necessary to effect the refunding of the City's outstanding obligations as contemplated by the Escrow Agreement; 4 ~VL\I.~IT .., 'R (f) At or prior to the Closing, the Underwriter shall have received each of the following documents: (1) The Official Statement of the City executed on behalf of the City by the Mayor and City Secretary; (2) The Ordinance certified by the City Secretary under its seal as having been duly adopted by the City and as being in effect, with such changes or amendments as may have been agreed to by the Underwriter; (3) The opinion, dated the date of Closing, of Fulbright & Jaworski LLP. ("Bond Counsel") in substantially the form and substance of Appendix C to the Official Statement; (4) An opinion or certificate, dated on or prior to the date of Closing, of the Attorney General of Texas, approving the Bonds as required by law and the registration certificate of the Comptroller of Public Accounts of the State of Texas; (5) The supplemental opinion, dated the date of Closing, of Bond Counsel, addressed to the City and the Underwriter, to the effect that (A) in its capacity as Bond Counsel, such firm has reviewed the information in the Official Statement under the captions "Plan of Financing: "Bond Information" (exclusive of subcaptions "Book-Entry Only System" and "Municipal Bond Insurance"), and the subcaptions "Tax Exemption: "Tax Accounting Treatment of DiscountJPreniium Bonds" and "Legal Investments and Eligibility to Secure Public Funds in Texas" under the captions "Other Information" and such firm is of the opinion that such information is correct as to matters of law and that provisions relating to the Bonds and the Ordinance fairly and accurately summarize such instruments in all materials respects; and (B) the Bonds are exempt from registration pursuant to the Securities Act of 1933, as amended, and the Ordinance is exempt from qualification as an indenture pursuant to the Trust Indenture Act of 1939, as amended. (6) An opinion of McCall, Parkhurst & Horton LLP., Underwriter's Counsel, addressed to the Underwriter, and dated the date of Closing to the effect that: (i) the Bonds are exempt securities within the meaning of Section 3(a)(2) of the Securities Act of 1933, as amended, and it is not necessary in connection with the sale of the Bonds to the public to register the Bonds under the Securities Act of 1933, as amended, or to qualify the Ordinance under the Trust Indent..ure Act of 1939, as amended; and (ii) in their participation in the preparation of the Official Statement, nothing has come to the attention of said firm which would lead them to believe that the Official Statement (excluding the financial and statistical data and forecasts included therein, all as to which no view need be expressed) contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (7) A certificate, dated the date of Closing, signed by the Director of Finance and the City Manager, to the effect that (i) the representations and warranties of the City contained herein are true and correct in all material respects on and as of the date of Closing as if made on the date of Qosing; (ii) except to the extent disclosed in the Official Statement, no litigation is pending or, to the knowledge of such persons, threatened in any court to restrain or enjoin the issuance or delivery of the Bonds, or the collection or application of the taxes and revenues pledged or to be pledged to pay the principal of and interest on the Bonds, or the 5 fV'-\\B\T B pledge thereof, or in any way contesting or affecting the validity of the Bonds, the Ordinance , the Escrow Agreement or this Purchase Contract, or contesting the powers of the City or the authorization of the Bonds or the Ordinance, or contesting in any way the accuracy, completeness or fairness of the Official Statement (but in lieu of or in conjunction with such certificate, the Underwriter may, in its sole discretion, accept certificates or opinions of the City Attorney that, in the opinion thereof, the issues raised in any such pending or threatened litigation are without substance or that the contentions of all plaintiffs therein are without merit); (iii) to the best of their knowledge, no event affecting the City has occurred since the date of the Official Statement which should be disclosed in the Official Statement for the purpose for which it is to be used or which it is necessary to disclose therein in order to make the statements and information therein not misleading in any respect; and (iv) that there has not been any material and adverse change in the affairs or financial condition of the City since September 30, 1992, the latest date as to which audited financial information is available; (8) A certificate, dated the date of the Closing, of an appropriate officer of the City to the effect that, on the basis of the facts, estimates and circumstances in effect on the date of delivery of the Bonds, it is not expected that the proceeds of the Bonds will be used in a manner that would cause the Bonds to be arbitrage bonds within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended; (9) A copy of a special report prepared by KPMG Peat Marwickwith respect to the Bonds addressed to the City, Bond Counsel, the Underwriters and the Underwriters' Counsel verifying the arithmetical computations of the adequacy of the maturing principal and interest on the escrowed securities and uninvested cash on hand under the Escrow Agreement to pay, when due, the principal of and interest on the obligations being refunded and the computation of the yield with respect to such securities and the Bonds; (10) Evidence of the rating on the Bonds, which shall be "Aaa" by Moody's Investors Service, Ine. ("Moody's") and "AAA" or better by Standard and Poor's Corporation ("S&P"), shall be delivered in a form acceptable to the Underwriter; (11) Evidence satisfactory to the Underwriter that the Bonds have been insured by a company having a claims-paying rating of not less than "Aaa" by Moody's and "AAA" by S&P; and (12) Such additional legal opinions, certificates, instruments and other documents as Bond Counselor the Underwriter may reasonably request to evidence the truth, accuracy and completeness, as of the date hereof and as of the date of Closing, of the City's representations and warranties contained herein and of the statements and information contained in the Official Statement and the due performance and satisfaction by the City at or prior to the date of Closing of all agreements then to be performed and all conditions then to be satisfied by the City. All of the opinions, letters, certificates, instruments and other documents mentioned above or elsewhere in this Purchase Contract shall be deemed to be in compliance with the provisions hereof if, but only if, they are satisfactory to the Underwriter. 6 EXJHBll B If the City shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds as set forth in this Purchase Contract, or if the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds shall be terminated for any reason permitted by this Purchase Contract, this Purchase Contract shall terminate, the security deposit referred to in Paragraph 4 of this Purchase Contract shall be returned to Rauscher Pierce Refsnes, Ine. and neither the Underwriter nor the City shall be under further obligation hereunder, except that the respective obligations of the City and the Underwriter set forth in Paragraphs 10 and 12 hereof shall continue in full force and effect. 9. Termination. The Underwriter may terminate its obligation to purchase the Bonds at any time before the Closing if any of the following should occur: (a) (i) Legislation shall have been enacted by the Congress of the United States, or recommended to the Congress for passage by the President of the United States or favorably reported for passage to either House of the Congress by any Committee of such House, or (ii) a decision shall have been rendered by a court established under Article III of the Constitution of the United States or by the United States Tax Court, or (ill) an order, ruling or regulation shall have been issued or proposed by or on behalf of the Treasury Department of the United States or the Internal Revenue Service or any other agency of the United States, or (iv) a release or official statement shall have been issued by the President of the United States or by the Treasury Department of the United States or by the Internal Revenue Service, the effect of which, in any such case described in clause (i), (ii), (ill), or (iv), would be to impose, directly or indirectly, federal income taxation upon interest received on obligations of the general character of the Bonds or upon income of the general character to be derived by the City, other than any imposition of federal income taxes upon interest received on obligations of the general character as the Bonds on the date hereof and other than as disclosed in the Official Statement, in such a manner as in the judgment of the Underwriter would materially impair the marketability or materially reduce the market price of obligations of the general character of the Bonds. (b) Any action shall have been taken by the Securities and Exchange Commission or by a court which would require registration of any security under the Securities Act of 1933, as amended, or qualification of any indenture under the Trust Indenture Act of 1939, as amended, in connection with the public offering of the Bonds, or any action shall have been taken by any court or by any governmental authority suspending the use of the Preliminary Official Statement or the Official Statement or any amendment or supplement thereto, or any proceeding for that purpose shall have been initiated or threatened in any such court or by any such authority. (c) (i) The Constitution of the State of Texas shall be amended or an amendment shall be proposed, or (ii) legislation shall be enacted, or (ill) a decision shall have been rendered as to matters of Texas law, or (iv) any order, ruling or regulation shall have been issued or proposed by or on behalf of the State of Texas by an official, agency or department thereof, affecting the tax status of the City, its property or income, its bonds (including the Bonds) or the interest thereon, which in the judgment of the Underwriter would materially affect the market price of the Bonds. (d) (i) A general suspension of trading in bonds shall have occurred on the New York Stock Exchange, or (ii) the United States shall have become engaged in hostilities (including the escalation of any hostilities existing on the date hereof, whether or not foreseeable), the effect of which, in either case described in clause (i) and (ii), is, in the judgment of the Underwriter, so material and adverse as to make it impracticable or 7 EXHIBiT B w_; inadvisable to proceed with the public offering or the delivery of the Bonds on the terms and in the manner contemplated in this Purchase Contract and the Official Statement. (e) An event described in Paragraph 6(j) hereof occurs which, in the opinion of the Underwriter, requires a supplement or amendment to the Official Statement that is deemed by it, in its discretion, to adversely affect the market for the Bonds. (1) A general banking moratorium shall have been declared by authorities of the United States, the State of New York or the State of Texas. (g) A lowering of the ratings initially assigned to the Bonds by Moody's and S&P, shall occur prior to the Closing. 10. Expenses. (a) The City shall payout of the bond proceeds all expenses incident to the issuance of the Bonds, including but not limited to: (i) the cost of the preparation and printing of the Preliminary Official Statement, the Official Statement and the Bonds; (ii) the fees and expenses of Bond Counsel to the City; (ill) the fees and disbursements of the City's accountants, advisors, and of any other experts or consultants retained by the City including its Financial Advisor and KPMG Peat Marwick for the verification report relating to the refunding; and (iv) the fees for the bond ratings and the premium for the policy of municipal bond insurance on the Bonds and any travel or other expenses incurred incident thereto; (b) The Underwriter shall pay (i) the cost of mailing the Preliminary Official Statement and the Official Statement; (ii) all advertising expenses in connection with the offering of the Bonds; (ill) the cost of the preparation and printing of all the underwriting documents; and (iv) the fee of McCall, Parkhurst & Horton LLP. as Underwriters Counsel. 11. Notices. Any notice or other communication to be given to the City under this Purchase Contract may be given by delivering the same in writing at the address for the City set forth above, and any notice or other communication to be given to the Underwriter under this Purchase Contract may be given by delivering the same in writing to Rauscher Pierce Refsnes, Inc., 2400 RPR Tower, Plaza of the Americas, Dallas, Texas 75201. 12. Parties in Interest. This Purchase Contract is made solely for the benefit of the City and the Underwriter (including the successors or assigns of any Underwriter) and no other person shall acquire or have any right hereunder or by virtue hereof. The City's representations, warranties and agreements contained in this Purchase Contract shall remain operative and in full force and effect, regardless of (i) any investigations made by or on behalf of the Underwriter, and (ii) deliyeJ)' of any payment for the Bonds hereunder; and the City's representations and warranties contained in Paragraph 6 of this Purchase Contract shall remain operative and in full force and effect, regardless of any termination of this Purchase Contract. 8 [XHf ,-, .r - .. ....-'! ;.<~ . .,,, ~ .,.." ~-' ",,'j ~ J' 13. Effective Date. This Purchase Contract shall become effective upon the execution of the acceptance hereof by the Mayor Pro Tem of the City and shall be valid and enforceable as of the time of such acceptance. Very truly yours, RAUScllliR PIERCE REFSNES, INe. NATIONSBANC CAPITAL MARKETS, INe. By: Rauscher Pierce Refsnes, Ine. Title: Accepted: This 12th day of August, 1993 By: Mayor Pro Tem City of Wylie, Texas Attest: City Secretary City of Wylie, ,Texas 9 EXHIBIT R EXHIBIT A OFFICIAL STATEMENT EXHIBIT B- C\/ U \ :-; \T C (..1\\ \ \ L) \ SPECIAL ESCROW AGREEMENT COUNTY OF DALLAS ~ ~ ~ THE STATE OF TEXAS THIS SPECIAL ESCROW AGREEMENT (the "Agreement"), made and entered into as of August 19, 1993, by and between the City of Wylie, Texas, a duly incorporated municipal corporation in Collin County, Texas (the "City") acting by and through the Mayor and City Secretary, and Ameritrust Texas National Association, a banking association organized and existing under the laws of the united States of America, or its successors or assigns hereunder (the "Bank"), WIT N E SSE T H : WHEREAS, the City has duly issued certain obligations now outstanding in the aggregate amount $5,165,000 (hereinafter collectively referred to as the "Refunded Obligations") and more particularly described as follows: (1) City of Wylie, Texas, Waterworks and Sewer system Revenue Bonds, Series 1971, dated March 1, 1971, maturing on June 1 in each of the years 1994 through 1996, and aggregating in principal amount $ 80,000 (2) ci ty of Wylie, Texas, Waterworks and Sewer System Revenue Bonds, Series 1980, dated March 1, 1980, maturing on June 1 in each of the years 1997 through 2005, and aggregating in principal amount $ 390,000 (3) City of Wylie, Texas, Waterworks and Sewer System Revenue Bonds, Series 1986, dated July 1, 1986, maturing on June 1 in each of the years 1994 through 2006, and aggregating in principal amount $ 130,000 (4) City of Wylie, Texas, General Obligation Bonds, Series 1986, dated August 15, 1986, maturing on February 15 in each of the years 1997 through 2006, and aggregating in principal amount $1,280,000 0108992 (5) City of Wylie, Texas, Tax and Waterworks and Sewer System Limited Pledge Revenue Certificates of Obligation, Series 1988, dated May 15, 1988, maturing on February 15 in each of the years 1999 through 2008, and aggregating in principal amount $ 910,000 (6) City of Wylie, Texas, Tax and Waterworks and Sewer System Limited Pledge Revenue Certificates of Obligation, Series 1990, dated February 15, 1990, maturing on February 15 in each of the years 2001 through 2010, and aggregating in principal amount $2,375,000 WHEREAS, in accordance with the provisions of Article 7l7k, V.A.T.C.S., as amended (the "Act"), the city is authorized to sell refunding bonds in an amount sufficient to provide for the payment of obligations to be refunded, deposit the proceeds of such refunding bonds with any place of payment for the obligations being refunded and enter into an escrow or similar agreement with such place of payment for the safekeeping, investment, reinvestment, administration and disposition of such deposit, upon such terms and conditions as the parties may agree, provided such deposits may be invested only in direct obligations of the united States of America, including obligations the principal of and interest on are unconditionally guaranteed by the United States of America, (hereinafter called the "Federal Securities") that mature and/or bear interest payable at such times and in such amounts as will be sufficient to provide for the scheduled payment of Refunded Obligations; and WHEREAS, the Refunded Obligations are scheduled to mature, or be redeemed, and interest thereon is payable on the dates and in the manner set forth in Exhibit A attached hereto and incorporated herein by reference as a part of this Agreement for all purposes; and WHEREAS, the City on the 19th day of August, 1993, pursuant to an ordinance (the "Bond ordinance") passed and adopted by the City Council, authorized the issuance of bonds known as "City of Wylie, Texas, Tax and Waterworks and Sewer System Surplus Refunding Bonds, Series 1993" (the "Bonds"), and such Bonds are being issued to refund, discharge and make final payment of the principal of and interest on the Refunded Obligations; and WHEREAS, upon the delivery of the Bonds, the proceeds of sale, together wi th other available funds of the ci ty , are to be deposited with the Bank and used in part to purchase the Federal Securities listed and identified in Exhibit B attached hereto and 0108992 -2- incorporated by reference as a part of this Agreement for all purposes; and WHEREAS, the Federal Securities shall be held and deposited to the credit of the "Escrow Fund" to be established and maintained by the Bank in accordance with this Agreement; and WHEREAS, the Federal Securities, together with the beginning cash balance in the Escrow Fund, shall mature and the interest thereon shall be payable at such times to insure the existence of monies sufficient to pay the principal amount of the Refunded Obligations and the accrued interest thereon, as the same shall become due in accordance with the terms of the ordinances authorizing the issuance of the Refunded obligations and as set forth in Exhibit A attached hereto; and WHEREAS, the City has completed all arrangements for the purchase of the Federal Securities listed in Exhibit B and the deposit and. credit of the same to the Escrow Fund as provided herein; and WHEREAS, the Bank is a banking association organized and existing under the laws of the United States of America, possessing trust powers and is fully qualified and empowered to enter into this Agreement; and WHEREAS, in Section 30 of the Bond Ordinance, the City Council duly approved and authorized the execution of this Agreement; and WHEREAS, the City and the Escrow Agent, as the case may be, shall take all action necessary to call, pay, redeem and retire said Refunded Obligations in accordance with the provisions thereof, including, without limitation, all actions required by the ordinances authorizing the Refunded Obligations, the Act, the Bond Ordinance and this Agreement; NOW, THEREFORE, in consideration of the mutual agreements herein contained, and to secure the payment of the principal of and the interest on the Refunded Obligations as the same shall become due, the City and the Bank hereby mutually undertake, promise and agree as follows: SECTION 1: ReceiDt of Refunded Bond ordi~ances. Receipt of copies of the. ordinances authorizing the lssuance of the Refunded obligations and the Bond Ordinance are-hereby acknowledged by the Bank. Reference herein to or citation herein of any provision of said documents shall be deemed an incorporation of such provision as a part hereof in the same manner and with the same effect as if it were fully set forth herein. 0108992 -3- ~_-_ >i\. ' ! r"\ - J1l .~..( f T i- SECTION 2: Escrow Fund Creation/Fundinq. There is hereby created by the City with the Bank a special segregated and irrevocable trust fund designated "SPECIAL 1993 CITY OF WYLIE, TEXAS, TAX AND REVENUE REFUNDING BOND ESCROW FUND" (hereinafter called the "Escrow Fund") for the benefit of the holders of the Refunded Obligations, and, immediately following the delivery of the Bonds, the City agrees and covenants to cause to be deposited with the Bank the following amounts: $5,665,871.15 for the purchase of Federal Securities identified in Exhibit B to be held for the account of the Escrow Fund $ 908.83 for deposit in the Escrow Fund as a beginning cash balance. The Bank hereby accepts the Escrow Fund and further agrees to receive said moneys, apply the same as set forth herein, and to hold the cash and Federal Securities deposited and credited to the Escrow Fund for application and disbursement for the purposes and in the manner provided in this Agreement. SECTION 3: Escrow Fund Sufficiencv Warranty. The City hereby represents that the cash and Federal Securities, together with the interest to be earned thereon, deposited to the credit of the Escrow Fund will be sufficient to pay the principal of and premium and interest on the Refunded Obligations as the same shall become due and payable, and such Refunded Obligations, and the interest thereon, are to mature or be redeemed and shall be paid at the times and in the amounts set forth and identified in Exhibit A attached hereto. FURTHERMORE, the Bank acknowledges receipt of (1) a notice of redemption with respect to the Series 1971 Refunded Obligations on December 1, 1993 and with respect to the Series 1980 Refunded Obligations on June 1, 1995 and (2) a copy of the resolution providing for the redemption of (i) series 1971 Refunded Obligations on December 1, 1993 at the redemption price of par plus accrued interest, (ii) Series 1980 Refunded Obligations on June 1, 1995 at the redemption price of par plus accrued interest, (iii) Series 1986 Refunded Obligations identified in paragraph (iii) on page 1 hereof on December 1, 1993 at the redemption price of par plus accrued inte~est, (iv) series 1986 Refunded Obligations identified in paragraph (iv) on page 1 hereof on February 15, 1996 at the redemption price of par plus accrued interest, (v) series 1988 Refunded Obligations on February 15, 1998 at the redemption price of par plus accrued interest and (vi) Series 1990 Refunded Obligations on February 15, 2000 at the redemption price of par plus accrued interest; all in accordance with the provisions of the 0108992 -4- EXHIBIT C respective notice requirements applicable to said Refunded Obligations and the notice requirements contained in the ordinances authorizing the Refunded Obligations. The Bank agrees to cause a notice of redemption pertaining to the Series 1986, Series 1988 and Series 1990 Refunded Obligations to be sent to the registered owners thereof appearing on the registration books at least thirty (30) days prior to the redemption date therefor. The Bank further agrees it will cause on a best effort basis to notify the holders of the Series 1971 and Series 1980 Refunded Obligations of the respective dates of redemption. SECTION 4: Pledae of Escrow. The Bank agrees that all cash and Federal Securities, together with any income or interest earned thereon, held in the Escrow Fund shall be and is hereby irrevocably pledged to the payment of the principal of and interest on the Refunded Obligations which will mature and become due on and after the date of this Agreement, and such funds initially deposited and to be received from maturing principal and interest on the Federal Securities in the Escrow Fund shall be applied solely in accordance with the provisions of this Agreement. SECTION 5: Escrow Insufficiencv - citv Warrantv to Cure. If, for any reason, the funds on hand in the Escrow Fund shall be insufficient to make the payments set forth in Exhibit A attached hereto, as the same becomes due and payable, the City shall make timely deposits to the Escrow Fund, from lawfully available funds, of additional funds in the amounts required to make such payments. Notice of any such insufficiency shall be immediately given by the Bank to the City by the fastest means possible, but the Bank shall in no manner be responsible for the City's failure to make such deposits. SECTION 6: Escrow Fund Securities/Segreqation. The Bank shall hold said Federal Securities and moneys in the Escrow Fund at all times as a special and separate trust fund for the benefit of the holders of the Refunded Obligations, wholly segregated from other moneys and securities on deposit with the Bank; shall never commingle said Federal Securities and moneys with other moneys or securities of the Bank; and shall hold and dispose of the assets therein only as set forth herein. Nothing herein contained shall be construed as requiring the Bank to keep the identical moneys, or any part thereof, in said Escrow Fund, if it is impractical, but moneys of an equal amount, except to the extent such are represented by the Federal Securities, shall always be maintained on deposit in the Escrow Fund by the Bank, as trustee; and a special account evidencing such facts shall at all times be maintained on the books of the Bank. 0108992 -5- :- ^ L1.' i ~!. I; to'." ';) ~ ~ u SECTION 7: Escrow Fund Collections/Payments. The Bank shall from time to time collect and receive the principal of and interest on the Federal Securities as they respectively mature and become due and credit the same to the Escrow Fund. On or before each principal and/or interest payment date or redemption date, as the case may be, for the Refunded Obligations shown in Exhibi t A attached hereto, the Bank, without further direction from anyone, including the City, shall cause to be withdrawn from the Escrow Fund the amount required to pay the accrued interest on the Refunded Obligations due and payable on said payment date and the principal of the Refunded - Obligations due and payable on said payment date or redemption date, as the case may be, and the amount withdrawn from the Escrow Fund shall be immediately transmitted and deposited with the paying agent for the Refunded Obligations to be paid with such amount. The paying agent for the Refunded Obligations is the Bank. If any Refunded Obligation or interest coupon thereon shall not be presented for payment when the principal thereof or interest thereon shall have become due, and if cash shall at such times be held by the Bank in trust for that purpose sufficient and available to pay the principal of such Refunded Obligation and interest thereon it shall be the duty of the Bank to hold said cash without liability to the holder of such Refunded Obligation for interest thereon after such maturity or redemption date, in trust for the benefit of the holder of such Refunded Obligation, who shall thereafter be restricted exclusively to said cash for any claim of whatever nature on his part on or with respect to said Refunded Obligation, including for any claim for the payment thereof and interest thereon. All cash required by the provisions hereof to be set aside or held in trust for the payment of the Refunded Obligations, including interest thereon, shall be applied to and used solely for the payment of the Refunded Obligations and interest thereon with respect to which such cash has been so set aside in trust. Subject to the provisions of the last sentence of section 25 hereof, cash held by the Bank in trust for the payment and discharge of any of the Refunded Obligations and interest thereon which remains unclaimed for a period of four (4) years after the stated maturity date or redemption date of such Refunded Obligations shall be returned to the City. .Notwithstanding the above and foregoing, any remittance of funds from the Bank to the City shall be subject to any applicable unclaimed property laws of the State of Texas.. 0108992 -6- EXHIBIT C SECTION 8: DisDosal of Refunded Obligations. All Refunded Obligations cancelled on account of payment by the Bank shall be disposed of or otherwise destroyed by the Bank, and an appropriate certificate of destruction furnished the city. SECTION 9 : Escrow Fund Encumbrance. The escrow created hereby shall be irrevocable and the holders of the Refunded Obligations shall have an express lien on all moneys and Federal Securities in the Escrow Fund until paid out, used and applied in accordance with this Agreement. Unless disbursed in payment of the Refunded Obligations, all funds and the Federal Securities received by the Bank for the account of the City hereunder shall be and remain the property of the Escrow Fund and the Ci ty and the owners of the Refunded Obligations shall be entitled to a preferred claim and shall have a first lien upon such funds and Federal Securities enjoyed by a trust beneficiary. The funds and Federal Securities received by the Bank under this Agreement shall not be considered as a banking deposit by the City and the Bank and the City shall have no right or title with respect thereto, except as otherwise provided herein. Such funds and Federal Securities shall not be subject to checks or drafts drawn by the City. SECTION 10: Absence of Bank Claim/Lien on Escrow Fund. The Bank shall have no lien whatsoever upon any of the moneys or Federal Securities in the Escrow Fund for paYment of services rendered hereunder, services rendered as paying agent/registrar.for the Refunded Obligations, or for any costs or expenses incurred hereunder and reimbursable from the City. SECTION 11: Substitution of Investments/Reinvestments. The Bank shall be authorized to accept initially and temporarily cash and/or substituted securities pending the delivery of the Federal Securities identified in the Exhibit B attached hereto, or shall be authorized to redeem the Federal Securities and reinvest the proceeds thereof, together with other moneys held in the Escrow Fund in noncallable direct obligations of the United States of America provided such early redemption and reinvestment of proceeds does not change the repayment schedule of the Refunded Obligations appearing in Exhibit A and the Bank receives the following: (1) an opinion by an independent certified public accountant to the effect that (i) the initial and/or temporary substitution of cash and/or securities for one or more of the Federal Securities identified in Exhibit B pending the receipt and delivery thereof to the Escrow Agent or (ii) the redemption of one or more of the Federal Securities and the reinvestment of such funds in one or more substituted securities (which shall 0108992 -7- u\HIBtT 0 be noncallable direct obligations of the United states of America), together with the interest thereon and other available moneys then held in the Escrow Fund, will, in either case, be sufficient, without reinvestment, to pay, as the same become due in accordance with Exhibit A, the principal of, and interest on, the Refunded Obligations which have not previously been paid, and (2) with respect to an early redemption of Federal Securities and the reinvestment of the proceeds thereof, an unqualified opinion of nationally recognized municipal bond counsel to the effect that (a) such investment will not cause interest on the Bonds or Refunded Obligations to be included in the gross income for federal income tax purposes, under the Code and related regulations as in effect on the date of such investment, or otherwise make the interest on the Bonds or the Refunded Obligations subject to Federal income taxation and (b) such reinvestment complies with the Constitution and laws of the state of Texas and with all relevant documents relating to the issuance of the Refunded Obligations and the Bonds. SECTION 12: Restriction on Escrow Fund Investments - Reinvestment. Except as provided in Section 11 hereof, moneys in the Escrow Fund will be invested only in the Federal Securities listed in Exhibit B and neither the City nor the Bank shall reinvest any moneys deposited in the Escrow Fund except as specifically provided by this Agreement. SECTION 14: Excess Funds. If at any time through redemption or cancellation of the Refunded Obligations there exists or will exist excesses of interest on or maturing principal of the Federal Securities in excess of the amounts necessary hereunder for the Refunded Obligations, the Bank may transfer such excess amounts to or on the order of the City, provided that the City delivers to the Bank the following: (1) an oplnlon by an independent certified public accountant that after the transfer of such excess, the principal amount of securities in the Escrow Fund, together with the interest thereon and other available monies then held in the Escrow Fund, will-be sufficient to pay, as the same become due, in accordance with Exhibit A, the principal of, and interest on, the Refunded Obligations which have not previously been paid, and 0108992 -8- EXHIBIT C (2) an unqualified oplnlon of nationally recognized municipal bond counsel to the effect that (a) such transfer will not cause interest on the Bonds or the Refunded Obligations to be included in gross income for federal income tax purposes, under the Code and related regulations as in effect on the date of such transfer, or otherwise make the interest on the Bonds or the Refunded Obligations subject to Federal income taxation, and (b) such transfer complies with the Constitution and laws of the state of Texas and with all relevant documents relating to the issuance of the Refunded Obligations or the Bonds. SECTION 14: Collateralization. The Bank shall continuously secure the monies in the Escrow Fund not invested in Federal Securities by a pledge of direct obligations of the United States of America, in the par or face amount at least equal to the principal amount of said uninvested monies to the extent such money is not insured by the Federal Deposit Insurance Corporation. SECTION 15: Absence of Bank's Liabilitv for Investments. The Bank shall not be liable or responsible for any loss resulting from any investment made in the Federal Securities or substitute securities as provided in Section 11 hereof. SECTION 16: Bank's ComDensation - Escrow Administration/ Settlement of pavina Aaent's Charqes. The City agrees to pay the Bank for the performance of services hereunder and as reimbursement for anticipated expenses to be incurred hereunder the amount of $5,500.00 and, except for reimbursement of costs and expenses incurred by the Bank pursuant to Sections 3, 11 and 19 hereof, the Bank hereby agrees said amount is full and complete payment for the administration of this Agreement. The City also agrees to deposit with the Bank on the effective date of this Agreement, the sum of $11,765 which deposit represents the total charges due for the Refunded Obligations and the Bank acknowledges and agrees that the above amount is and represents the total amount of compensation due the Bank for services rendered as paying agent for the Refunded Obligations. The Bank hereby agrees to pay, assume and be fully responsible for any additional charges that it may incur in the performance of its duties and responsibilities as paying agent for the Refunded Obligations. 0108992 -9- Ey ~W=< ii t .Jl\.., ; to' ~ The Ci ty acknowledges and agrees that the above amount deposited with the Escrow Agent to cover paying agents' charges and expenses does not include amounts which shall become due and payable for services rendered as registrar and transfer agent for fully registered Refunded Obligations, and the City agrees to pay directly to each "registrar" for the Refunded Obligations all reasonable costs, expenses and charges incurred in connection with the maintenance of the registration books and records and the transfer of such fully registered obligations as and when such costs, expenses and charges are incurred and against wr i tten invoices, statements or bills submitted therefor. SECTION 17: Escrow Aqent's Duties / ResDonsibilities/ Liabilitv. The Bank shall not be responsible for any recital herein, except with respect to its organization and its powers and authority. As to the existence or nonexistence of any fact relating to the City or as to the sufficiency or validity of any instrument, paper or proceedings relating to the City, the Bank shall be entitled to rely upon a certificate signed on behalf of the City by its City Manager or Mayor and/or City Secretary of the City as sufficient evidence of the facts therein contained. The Bank may accept a certificate of the City Secretary under the City's seal, to the effect that a resolution or other instrument in the form therein set forth has been adopted by the City Council of the City, as conclusive evidence that such resolution or other instrument has been duly adopted and is in full force and effect. The duties and obligations of the Bank shall be determined solely by the express provisions of this Agreement and the Bank shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Agreement, and no implied covenants or obligations shall be read into this Agreement against the Bank. In the absence of bad faith on the part of the Bank, the Bank may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificate or opinion furnished to the Bank, conforming to the requirements of this Agreement; but notwithstanding any provision of this Agreement to the contrary, in the case of any such certificate or opinion or any evidence which by any provision hereof is specifically required to be furnished to the Bank, the Bank shall be under a duty to examine the same to determine whether it conforms- to the requirements of this Agreement. The Bank shall not be liable for any error of judgment made in good faith by a Responsible Officer or Officers of the Bank unless it shall be proved that the Bank was negligent in ascertaining or acting upon the pertinent facts. 0108992 -10- f:i~HIBIT C The Bank shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the holders of not less than a majority in aggregate principal amount of all said Refunded Obligations at the time outstanding relating to the time, method and place of conducting any proceeding for any remedy available to the Bank not in conflict with the intent and purpose of this Agreement. For the purposes of determining whether the holders of the required principal amount of said Refunded Obligations have concurred in any such direction, Refunded Obligations owned by any obligor upon the Refunded Obligations, or by any person directly or indirectly controlling or controlled by or under direct or indirect common control with such obligor, shall be disregarded, except that for the purposes of determining whether the Bank shall be protected in relying on any such direction only Refunded Obligations which the Bank knows are so owned shall be so disregarded. The term "Responsible Officers" of the Bank, as used in this Agreement, shall mean and include the Chairman of the Board of Directors, the President, any Vice President and any Second Vice President, the Secretary and any Assistant Secretary, the Treasurer and any Assistant Treasurer, and every other officer and assistant officer of the Bank customarily performing functions similar to those performed by the persons who at the time shall be officers, respectively, or to whom any corporate trust matter is referred, because of his knowledge of and familiarity with a particular subject; and the term "Responsible Officer" of the Bank, as used in this Agreeme~t, shall mean and include any of said officers or persons. SECTION 18: Limitation Re: Bank's Duties/Responsibilities/ Liabilities to Third Parties. The Bank shall not be responsible or liable to any person in any manner whatever for the sufficiency, correctness, genuineness, effectiveness, or validity of this Agreement with respect to the City, or for the identity or authority of any person making or executing this Agreement for and on behalf of the City. The Bank is authorized by the City to rely upon the representations of the City with respect to this Agreement and the deposits made pursuant hereto and as to the City's right and power to execute and deliver this Agreement, and the Bank shall not be liable in any manner as a result of such reliance. The duty of the Bank hereunder shall only be to the City and the holders of the Refunded Obligations. Neither the City nor the Bank shall assign or attempt to assign or transfer any interest hereunder or any portion of any such interest. Any such assignment or attempted assignment shall be in direct conflict with this Agreement and be without effect. 0108992 -11- HI R i"f C . ("...,t \:a; SECTION 19: InterDleader. In the event conflicting demands or notices are made upon the Bank growing out of or relating to this Agreement or the Bank in good faith is in doubt as to what action should be taken hereunder, the Bank shall have the right at its election to: (a) Withhold and stop all further proceedings in, and performance 9f, this Agreement with respect to the issue in question and of all instructions recei ved hereunder in regard to such issue; and (b) File a suit in interpleader and obtain an order from a court of appropriate jurisdiction requiring all persons involved to interplead and litigate in such court their several claims and rights among themselves. In the event the Bank becomes involved in litigation in connection with this Section, the City, to the extent permitted by law, agrees to indemnify and save the Bank harmless from all loss, cost, damages, expenses and attorney fees suffered or incurred by the Bank as a result thereof. The obligations of the Bank under this Agreement shall be performable at the principal corporate office of the Bank in the City of Dallas, Texas. The Bank may advise with legal counsel in the event of any dispute or question regarding the construction of any of the provisions hereof or its duties hereunder, and in the absence of negligence or bad faith on the part of the Bank, no liability shall be incurred by the Bank for any action taken pursuant to this Section and the Bank shall be fully protected in acting in accordance with the opinion and instructions of legal counsel that is knowledgeable and has expertise in the field of law addressed in any such legal opinion or with respect to the instructions given. SECTION 20: Accountina - Annual ReDort. Promptly after September 30th of each year, commencing with the year 1993, while the Escrow Fund is maintained under this Agreement, the Bank shall forward to the City, to the attention of the City Manager, or other designated official of the City, a statement in detail of the Federal Securities and monies held, and the current income and maturities thereof, and the withdrawals of money from the Escrow Fund for the preceding 12 month period ending September 30th of each year. 0108992 -12- r:~H!B'T C SECTION 21: Notices. 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 as follows: CITY OF WYLIE, TEXAS 2000 Highway 78 North Wylie, Texas 75098 Attention: City Manager AMERITRUST TEXAS NATIONAL ASSOCIATION P. o. Box 2320 Dallas, texas 75201 Attention: Debt Administration The United States Post Office registered or certified mail receipt showing delivery of the aforesaid shall be conclusive evidence of the date and fact of delivery. Any party hereto may change the address to which notices are to be delivered by giving to the other parties not less than ten (10) days prior notice thereof. SECTION 22: Performance Date. Whenever under the terms of this Agreement the performance date of any provision hereof, including the date of maturity of interest on or principal of the Refunded Obligations, shall be a Sunday or a legal holiday or a day on which the Bank is authorized by law to close, then the performance thereof, including the payment of principal of and interest on the Refunded Obligations, need not be made on such date but may be performed or paid, as the case may be, on the next succeeding business day of the Bank with the same force and effect as if made on the date of performance or payment and with respect to a payment, no interest shall accrue for the period after such date. SECTION 23: Warrantv of Parties Re: Power to Execute and Deliver Escrow Aareement. The City covenants that it will faithfully perform at all times any and all covenants, undertakings, stipulations and provisions contained in this Agreement, in any and every said Refunded Obligation as executed, authenticated and delivered and in all proceedings pertaining thereto as said Refunded Obligations shall have been modified as provided in this Agreement. The City covenants that it is duly authorized under the Constitution and laws of the State of Texas 0108992 -13- fiXHIRIT to execute and deliver this Agreement, that all actions on its part for the payment of said Refunded Obligations as provided herein and the execution and delivery of this Agreement have been duly and effectively taken and that said Refunded Obligations and coupons in the hands of the holders and owners thereof are and will be valid and enforceable obligations of the City according to the import thereof as provided in this Agreement. SECTION 24: Severabilitv. If anyone or more of the covenants or agreements provided in this Agreement on the part of the parties to be performed should be determined by a court of competent jurisdiction to be contrary to law, such covenant or agreement shall be deemed and construed to be severable from the remaining covenants and agreements herein contained and shall in no way affect the validity of the remaining provisions of this Agreement. In the event any covenant or agreement contained in this Agreement is declared to be severable from the other provisions of this Agreement, written notice of such event shall immediately be given to each national rating service (Moody's Investors Service, Standard & Poor's Corporation or Fitch Investors Service) which has rated the Refunded Obligations on the basis of this Agreement. SECTION 25: Termination. This Agreement shall terminate when the Refunded Obligations, including interest due thereon, have been paid and discharged in accordance with the provisions of this Agreement. If any Refunded Obligations are not presented for payment when due and payable, the nonpayment thereof shall not prevent the termination of this Agreement. Funds for the payment of any nonpresented Refunded Obligations and accrued interest thereon shall upon termination of this Agreement be held by the Bank for such purpose in accordance with Section 7 hereof. Any moneys or Federal Securities held in the Escrow Fund at termination and not needed for the payment of the principal of or interest on any of the Refunded Obligations shall be paid or transferred to the City. SECTION 26: Time of the Essence. Time shall be of the essence in the performance of obligations from time to time imposed upon the Bank by this Agreement. SECTION 27: Successors/Assians. (a) Should the Bank not be able to legally serve or perform the duties and obligations under this Agreement, or should the Bank be declared to be insolvent or closed for any reason by federal or state regulatory authorities or a court of competent jurisdiction, the City, upon being notified or discovering the Bank's inability or disqualification to serve hereunder, shall forthwith appoint a successor to replace the Bank, and upon being notified of such appointment, the Bank shall (i) transfer all funds and securities 0108992 -14- EXHIBfT C held hereunder, together with all books, records and accounts relating to the Escrow Fund and the Refunded Obligations, to such successor and (ii) assign all rights, duties and obligations under this Agreement to such successor. If the City should fail to appoint such a successor within ninety (90) days from the date the Ci ty discovers, or is notif ied of, the event or circumstance causing the Bank's inability or disqualification to serve hereunder, the Bank, or a bondholder of the Refunded Obligations, may apply to a court of competent jurisdiction to appoint a successor or assigns of the Bank and such court, upon determining the Bank is unable to continue to serve, shall appoint a successor to serve under this Agreement and the amount of compensation, if any, to be paid to such successor for the remainder of the term of this Agreement for services to be rendered both for administering the Escrow Fund and for paying agent duties and responsibilities for the Refunded Obligations. (b) Furthermore, the Bank may resign and be discharged from performing its duties and responsibilities under this Agreement upon notifying the City in writing of its intention to resign and requesting the City to appoint a successor. No such resignation shall take effect until a successor has been appointed by the City and such successor has accepted such appointment and agreed to perform all duties and obligations hereunder for a total compensation equal to the unearned proportional amount paid the Bank under section 16 hereof for the administration of this Agreement and the unearned proportional amount of the paying agents fees for the Refunded Obligations due the Bank. Any successor to the Bank shall be a bank, trust company or other financial institution that is duly qualified under applicable law (the Act or other appropriate statute) to serve as escrow agent hereunder and authorized and empowered to perform the duties and Obligations contemplated by this Agreement and organized and doing business under the laws of the United states or the state of Texas, having its principal office and place of business in the State of Texas, having a combined capital and surplus of at least $5,000,000 and be subject to the supervision or examination by Federal or State authority. Any successor or assigns to the Bank shall execute, acknowledge and deliver to the City and the Bank, or its successor or assigns, an instrument accepting such appointment hereunder, and the Bank shall execute and deliver an instrument transferring to such successor, subject to the terms of this Agreement, all the rights, powers and trusts created and established and to be performed under this Agreement. Upon the request of any such successor Bank, the City shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor Bank all such rights, powers and duties. The term 0108992 -15- EXHH3n t "Bank" as used herein shall be the Bank and its legal assigns and successor hereunder. SECTION 28: Escrow Aareement - Amendment/Modification. This Agreement shall be binding upon the City and the Bank and their respective successors and legal representatives and shall inure solely to the benefit of the holders of the Refunded Obligations, the City, the Bank and their respective successors and legal representatives. Furthermore, no alteration, amendment or modification of any provision of this Agreement shall (1) alter the firm financial arrangements made for the payment of the Refunded Obligations or (2) be effective unless (i) prior written consent of such alteration, amendment or modification shall have been obtained from the holders of all Refunded Obligations outstanding at the time of such alteration, amendment or modification and (ii) such alteration, amendment or modification is in writing and signed by the parties hereto; provided, however, the City and the Bank may, without the consent of the holders of the Refunded Obligations, amend or modify the terms and provisions of this Agreement to cure in a manner not adverse to the holders of the Refunded Obligations any ambiguity, formal defect or omission in this Agreement. If the parties hereto agree to any amendment or modification to this Agreement, prior written notice of such amendment or proposed modification, together with the legal documents amending or modifying this Agreement, shall be furnished to each national rating service (Standard & Poor's Corporation, Moody's Investors Service or Fitch Investors Service) which has rated the Refunded Obligations on the basis of this Agreement, prior to such amendment or modification being executed. SECTION 29: Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction hereof. SECTION 30: Executed CounterDarts. This Agreement may be executed in several counterparts, all or any of which shall be regarded for all purposes as one original and shall constitute and be but one and the same instrument. This Agreement shall be governed by the laws of the State of Texas and shall be effective as of the date of the delivery of the Bonds. 0108992 -16- HIBfT C IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be executed by their duly authorized officers and their corporate seals to be hereunto affixed and attested as of the date first above written. CITY OF WYLIE, TEXAS Mayor Pro Tem ATTEST: City Secretary (City Seal) AMERITRUST TEXAS ASSOCIATION, as Escrow Agent NATIONAL Title: ATTEST: Authorized Signer (Bank Seal) 0108992 -17- EXHiBIT ()