Ordinance 2002-35
ORDINANCE NO.pa7~ - 35
AN ORDINANCE authorizing the issuance of "CITY OF WYLIE, TEXAS,
WATERWORKS AND SEWER SYSTEM REVENUE BONDS,
SERIES 2002"; pledging the net revenues of the City's Waterworks and
Sewer System to the payment of the principal of and interest on said
Bonds; enacting provisions incident and related to the issuance, payment,
security and delivery of said bonds, including the approval and execution
of a Paying AgentlRegistrar 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 hereby finds and determines the
remaining principal amount of revenue bonds ($1,150,000) approved and authorized to be
issued at an election held May 1, 1999 for improvements and extensions to the City's combined
Waterworks and Sewer System should be issued and sold at this time;
WHEREAS, the City Council further finds and determines that such revenue bonds can
and should be issued as -Additional Parity Obligations" (hereinafter defined) on a parity with
certain currently outstanding revenue bonds (hereinafter identified and defined as the Previously
Issued Bonds) that are payable from and equally and ratably secured by a first lien. on and
pledge of the Net Revenues of the City's Waterworks and Sewer System (the -System") in that
(i) the Director of Finance of the City will execute a certificate stating (a) that, to the best of his
knowledge and belief, the City is not now in default as to any covenant, obligation or agreement
contained in any ordinance or other proceeding relating to any obligations of the City payable
from and secured by a lien on and pledge of the Net Revenues of the System that would
materially affect the security or payment of such obligations and (b) payments into all special
funds or accounts created and established for the payment and security of all outstanding
obligations payable from and secured by a lien on and pledge of the Net Revenues of the
System have been made and that the amounts on deposit in such special funds or accounts are
the amounts then required to be on deposit therein; (ii) the Additional Parity Bonds herein
authorized shall mature or be payable as to principal on February 15 in each year, and (iii) the
City can secured a certificate or opinion of a certified public accountant to the effect that,
according to the books and records of the City, the Net Earnings, for the preceding Fiscal Year
or for 12 consecutive months out of the 15 months immediately preceding the month this
ordinance is adopted, are at least equal to 1.25 times the -Average Annual Debt Service" (as
herein defined) for all outstanding -Previously Issued Bonds. and the bonds herein authorized;
now, therefore,
,
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BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF WYLIE, TEXAS:
SECTION 1: Authorization-Desianation-Principal Amount - Puroose. Revenue bonds
of the City shall be and are hereby authorized to be issued in the aggregate principal amount of
$1,150,000 to be designated and bear the title "CITY OF WYLIE, TEXAS, WATERWORKS AND
SEWER SYSTEM REVENUE BONDS, SERIES 2002" (hereinafter referred to as the "Bonds"),
for improvements and extensions to the City's combined Waterworks and Sewer System, in
conformity with the Constitution and laws of the State of Texas, including V.T.CA., Government
Code, Section 1502.051(c).
SECTION 2: Fullv Reaistered Obliaations - Authorized Denominations - Stated
Maturities - Date. The Bonds shall be issued as fully registered obligations, without coupons,
viYL1E REV 2002_ ORDINANCE (3).DOC
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shall be dated September 15, 2002 (the "Bond Date") and, other than the single fully registered
Initial Bond referenced in Section 8 hereof, shall be in denominations of $5,000 or any integral
multiple thereof (within a Stated Maturity), shall be numbered consecutively from One (1)
upward 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 per annum rates in accordance with the
following schedule:
YEAR OF PRINCIPAL INTEREST
STATED AMOUNT RA TE(S)
MATURITY
2003 $ 40,000 %
2004 35,000 %
2005 40,000 %
2006 40,000 %
2007 40,000 %
2008 45,000 %
2009 45,000 %
2010 50,000 %
2011 50,000 %
2012 55,000 %
2013 55,000 %
2014 60,000 %
2015 60,000 %
2016 65,000 %
2017 70,000 %
2018 70,000 %
2019 75,000 %
2020 80,000 %
2021 85,000 %
2022 90,000 %
The Bonds shall bear interest on the unpaid principal amounts from the Bond Date at the
rate(s) per annum shown in the above schedule (calculated on the basis of a 36O-day year of
twelve 30-day months). Interest on the Bonds shall be payable on February 15 and August 15
in each year, commencing February 15, 2003.,
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SECTION 3: Terms of Payment - Pavino AoenVReoistrar. 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 "Holde~s") appearing on the registration and transfer books maintained by the Paying
Agent/Registrar, and such payment 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 JP Morgan Chase Bank, Dallas, Texas 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
WYLIE REV 2002_ ORDINANCE (3).DOC
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Agent/Registrar, as provided 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 AgentlRegistrar and the City may
prescribe. The Mayor 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 AgenVRegistrar 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 AgentlRegistrar 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 AgenVRegistrar.
Principal of and premium, if any, on the Bonds shall be payable at the Stated Maturities
or upon the earlier redemption thereof, only upon presentation and surrender of the Bonds to
the Paying Agent/Registrar at its designated offICeS in Dallas, Texas (the "Designated
PaymentlTransfer Office"). Interest on the Bonds shall be paid to the Holders whose names
appear 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
AgenVRegistrar (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 AgenVRegistrar, 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 PaymentITransfer
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 non-payment of interest on one or more maturities on a scheduled
payment date, and for thirty (30) days thereafter, a new record date for such interest payment
for such maturity or maturities (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 of such m~urity or maturities appearing on the Security
Register at the close of business on the last busir'less day next preceding the date of mailing of
such notice.
SECTION 4: Redemption. (a) Optional Redemption. The Bonds maturing on and
after February 15, 2013, 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 August 15, 2012 or on any
date thereafter at the redemption price of par plus accrued interest to the date of redemption.
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 AgentlRegistrar), the City shall notify the
Paying AgenVRegistrar 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
WYLIE REV 2002_ ORDINANCE (3).DOC
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exercise the right to redeem Bonds shall be entered in the minutes of the goveming body of the
City.
(b) Mandatory Redemption. The Bonds having Stated Maturities of February 15"
20_, February 15, 20_ and February 15, 20_ (the "Term Bonds") shall be subject to
mandatory redemption in part prior to maturity at the redemption price of par and accrued
interest to the date of redemption on the respective dates and in principal amounts as follows:
Term Bonds due February 15, 20_
Redemption Date Principal Amount
Term Bonds due February 15, 20_
Redemption Date Principal Amount
February 15, 20
February 15, 20
$ ,000
$ ,000
February 15, 20
February 15, 20
$ ,000
$ ,000
Term Bonds due February 15, 20
Redemption Date Principal Amount
February 15, 20
February 15, 20
February 15, 20
$ ,000
$ ,000
$ ,000
Approximately forty-fIVe (45) days prior to each redemption date specified above the
Term Bonds are to be mandatorily redeemed, the Paying AgentlRegistrar shall select by lot the
numbers of the Term Bonds within the applicable Stated Maturity to be redeemed on the next
following February 15 from rnoneys set aside for that purpose in the Interest and Sinking Fund
(as hereinafter defined). Any Term Bond not selected for prior redemption shall be paid on the
date of their Stated Maturity.
The principal amount of the Term Bonds for a Stated Maturity required to be redeemed
on a redemption date may be reduced, at the option of the City, by the principal amount of Term
Bonds of like Stated Maturity which, at least 50 days prior to a mandatory redemption date, (1)
shall have been acquired by the City at a price not exceeding the principal amount of such Term
Bonds plus accrued interest to the date of purchase thereof, and delivered to the Paying
AgentlRegistrar for cancellation or (2) shall have been redeemed pursuant to the optional
redemption provisions set forth in paragraph(a) of this Section and not theretofore credited
against a mandatory redemption requirement.
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(c) Selection of Bonds for Redemptior'l.lf 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 ~uch Stated Maturity by lot.
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(d) Notice of Redemption. 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 notice, and
any notice of redemption so mailed shall be conclusively presumed to have been duly given
irrespective of whether received by the Holder.
WYLIE REV 2002_ ORDINANCE (3).DOC
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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 redernption 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
redernption date, and (v) specify that payment of the redemption price for the Bonds, or the
principal amount thereof to be redeemed, shall be made at the Designated Paymentrrransfer
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 or waived as herein 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 Bonds (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: Reoistration - Transfer - Exchanoe of Bonds - Predecessor Bonds. The
Paying Agent/Registrar shall obtain, record, and maintain in the Security Register the name and
address of each registered owner of the Bonds issued under and pursuant to the provisions of
this Ordinance. Any Bond may, in accordance with its terms and the terms hereof, be
transferred or exchanged for Bonds of other authorized denominations upon the Security
Register by the Holder, in person or by his duly authorized agent, upon surrender of such Bond
to 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 for transfer of any Bond (other than the Initial Bonds authorized in
Section 8 hereof) at the Designated PaymentlTransfer Office of the Paying Agent/Registrar, the
Paying Agent/Registrar shall register and deliver, in the name of the designated transferee or
transferees, one or more new Bonds, executed on behalf of, and furnished by, the City of
authorized denorninations and having the same 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 Bonds 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 surrencter of the Bonds to be exchanged at the
Designated PayrnentlTransfer Office of the Payinb Agent/ Registrar. Whenever any Bonds are
surrendered for exchange, the Paying Agent/Registrar shall register and deliver new Bonds,
executed on behalf of, and furnished by, the City, to the Holder requesting the exchange.
All Bonds issued upon any transfer or exchange of Bonds shall be delivered at the
Designated PaymentlTransfer Office of the Paying AgentlRegistrar, or sent by United States
Mail, first class postage prepaid, to the Holder and, upon the delivery thereof, the same shall be
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
WYLIE REV 2002_ ORDINANCE (3).DOC
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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 sarne obligation to pay evidenced by the 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 Section 30 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 AgentlRegistrar shall be required to transfer or exchange
any Bond called for redemption, in whole or in part, within 45 days of the date fIXed for
redemption of such Bond; provided, however, such limitation of transfer 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 operational arrangements referenced in the
Blanket Issuer Letter of Representation, by and between the City and DTC (the "Depository
Agreement").
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, shall be Cede & Co., as
nominee of DTC, notwithstanding 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 definith7e 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.
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SECTION 7: Execution - Reoistration. The Bonds shall be executed on behalf of the
City by the Mayor under its seal reproduced or impressed thereon and countersigned by the
City Secretary. The signature of said officers 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
WYLIE REV 2002_ ORDINANCE (3).DOC
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subsequent exchanges and transfers, all as authorized and provided in V.T.CA., Governrnent
Code, Chapter 1201.
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 registration
substantially in the form provided in Section 90, manually executed by an authorized officer,
employee or representative of the Paying Agent/ Registrar, and either such certificate upon any
Bond duly signed 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 referenced in Section 1
hereof with principal installments to become due and payable as provided in Section 2 hereof
and numbered T-1, or (ii) as multiple fully registered bonds, being one bond for each year of
maturity in the 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 narned 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 Generally. The Bonds, the Registration Certificate
of the Comptroller of Public Accounts of the State of Texas, the Certificate of Registration, 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, or any
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maturities thereof, are purchased with insurance clnd 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 thereof. 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,
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.
WYLIE REV 2002_ ORDINANCE (3).DOC
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B. Form of Definitive Bond.
REGISTERED REGISTERED
NQ $
UNITED STATES OF AMERICA
STATE OF TEXAS
CITY OF WYLIE, TEXAS,
WATERWORKS AND SEWER SYSTEM
REVENUE BOND, SERIES 2002
Bond Date: Interest Rate:
September 15, 2002
Stated Maturity:
CUSIP NO:
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, hereby promises to pay
to the order of the Registered Owner named above, or the registered assigns thereof, solely
from the revenues hereinafter identified, on the Stated Maturity date specified above the
Principal Amount stated above (or so much thereof as shall not have been paid upon prior
redemption) and to pay interest (computed on the basis of a 360-day year of twelve 30-day
months) on the unpaid Principal Amount hereof from the Bond Date at the per annum rate of
interest specified above; such interest being payable on February 15 and August 15 of each
year, commencing February 15, 2003. Principal of this Bond is payable at its Stated Maturity or
redemption to the registered owner hereof, upon presentation and surrender, at the Designated
PaymentlTransfer Office of the Paying Agent/Registrar executing the registration certificate
appearing hereon, or its successor; provided, however, while this Bond is registered to Cede &
Co., the payment of principal upon a partial redemption of the principal amount hereof may be
accomplished without presentation and surrender of this Bond. 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 AgentlRegistrar, requested by, and at the risk and expense of, the
registered owner. 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.
This Bond is one of the series specified in its title issued in the aggregate principal
amount of $1,150,000 (herein referred to as the "Bonds") for the purpose of making
improvements and extensions to the City's combined Waterworks and Sewer System, under
and in strict conformity with the Constitution and laws of the State of Texas, including V.T.CA.,
Government Code, Section 1502.051(c), and pursuant to an Ordinance adopted by the City
WYLIE REV 2002_0RDINANCE (3).DOC
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Council of the City (herein referred to as the "Ordinance").
The Bonds maturing on the dates hereinafter identified (the "Term Bonds") are subject to
mandatory redemption prior to maturity with funds on deposit in the Interest and Sinking Fund
established and maintained for the payment thereof in the Ordinance, and shall be redeemed in
part prior to maturity at the price of par and accrued interest thereon to the date of redemption,
and without premium, on the date and in the principal amount as follows:
Term Bonds due February 15, 20_
Redemption Date Principal Amount
Term Bonds due February 15, 20_
Redemption Date Principal Amount
February 15, 20
February 15, 20
$ ,000
$ ,000
February 15, 20
February 15, 20
$ ,000
$ ,000
Term Bonds due February 15, 20
Redemption Date Principal Amount
February 15, 20
February 15, 20
February 15, 20
$ ,000
$ ,000
$ ,000
The particular Term Bonds of a stated maturity to be redeemed on each redemption date
shall be chosen by lot by the Paying AgentlRegistrar; provided, however, that the principal
amount of Term Bonds for a stated maturity required to be redeemed on a redemption date may
be reduced, at the option of the City, by the principal amount of Term Bonds of like stated
maturity which, at least 50 days prior to a mandatory redemption date, (1) shall have been
acquired by the City at a price not exceeding the principal amount of such Term Bonds plus
accrued interest to the date of purchase thereof, and delivered to the Paying Agent/Registrar for
cancellation or (2) shall have been redeemed pursuant to the optional redemption provisions
appearing below and not theretofore credited against a mandatory redemption requirement.
The Bonds maturing on and after February 15, 2013, 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
AgentlRegistrar), on August 15, 2012 or on any date thereafter at the redemption price of par
plus accrued interest thereon to the redemption d~e.
.\
At least thirty days prior to the date fIXed for any redemption of Bonds, the City shall
cause a written notice of such redemption to be sent by United States Mail, first class postage
prepaid, to the registered owners of each Bond to be redeemed at the address shown on the
Security Register and subject to the terms and provisions relating thereto contained in the
Ordinance. If a Bond (or any portion of its principal sum) shall have been duly called for
redemption and notice of such redemption duly given, then upon such redemption date such
Bond (or the portion of its principal sum 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
AgentlRegistrar.
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In the event a portion of the principal amount of a Bond is to be redeemed and the
registered owner is someone other than Cede & Co., payment of the redemption price of such
principal amount shall be made to the registered owner only upon presentation and surrender of
such Bond to the Designated PaymentITransfer Office of the Paying AgentIRegistrar, and 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 thereof will be issued to
the registered owner, without charge. If a Bond is selected for redemption, in whole or in part,
the City and the Paying AgentlRegistrar shall not be required to transfer such 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 to an exchange by the
registered owner of the unredeemed balance of a Bond redeemed in part.
The Bonds are special obligations of the City and, together with the outstanding
.Previously Issued Bonds" (identified and defined in the Ordinance, payable solely from and
equally and ratably secured by a first lien on and pledge of the Net Revenues (as defined in the
Ordinance) of the City's combined Waterworks and Sewer System (the "System"). The Bonds
do not constitute a legal or equitable pledge, charge, lien or encumbrance upon any property of
the City or the System, except with respect to the Net Revenues. The holder hereof shall never
have the right to demand payment of this obligation out of any funds raised or to be raised by
taxation.
Subject to satisfying the terms and conditions prescribed therefor, the City has reserved
the right to issue additional revenue obligations payable from and equally and ratably secured
by a parity lien on and pledge of the Net Revenues of the System, in the same manner and to
the same extent as the Previously Issued Bonds and the Bonds.
Reference is hereby made to the Ordinance, a copy of which is on file in the Designated
PaymentlTransfer Office of the Paying AgentlRegistrar, and to all of the provisions of which the
Holder by the acceptance hereof hereby assents, for definitions of terms; the description of and
the nature and extent of the security for 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 lien and pledge securing the payment of the
Bonds; the terms and conditions for the issuance of additional revenue obligations; 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 AgentlRegistrar; the terms and
provisions upon which the liens, pledges, charges and covenants made therein may be
discharged at or prior to the maturity or redemptio{l 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 same 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
PaymentlTransfer:Office of the Paying AgentlRegistrar, 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 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
AgentlRegistrar to the designated transferee or transferees.
WYLIE REV 2002_ ORDINANCE (3).DOC
-11-
The City and the Paying Agent/Registrar, and any agent of either, rnay treat the
registered owner hereof 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 payrnent 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 non-payment of interest on a scheduled payment date and for
thirty (30) days thereafter, a new record date for such interestpayrnent (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 covenanted that the City is a duly
organized and legally existing municipal corporation 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 rnanner 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 a pledge of the Net Revenues of the
System as aforestated. In case any provision in this Bond or any application thereof shall be
invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining
provisions and applications 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.
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.
~yor
COUNTERSIGNED:
(SEAL)
l
r
't
WYLIE REV 2002_ ORDINANCE (3).DOC
-12-
/
C. Form of Registration Certificate of Comptroller of Public Accounts to Appear on
Initial Bond(s) only.
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER
OF PUBLIC ACCOUNTS
THE STATE OF TEXAS
)
)
)
)
)
REGISTER NO.
I HEREBY CERTIFY that this Bond has been examined, certified as to validity and
approved by the Attorney General of the State of Texas, and duly registered by the Comptroller
of Public Accounts of the State of Texas.
WITNESS rny signature and seal of office this
Comptroller of Public Accounts
of the State of Texas
(SEAL)
*NOTE TO PRINTER: Do Not Print on Definitive Bonds
only.
D. Form of Certificate of Paying AgentlRegistrar to appear on Definitive Bonds
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 the records of the Paying
AgentlRegistrar.
-
.-
The designated offices of the Paying Agent/Registrar in Dallas, Texas is the "Designated
PaymentlTransfer Office" for this Bond.
JPMORGAN CHASE BANK,
Dallas, Texas,
as Paying Agent/Registrar
Registration date:
By:
Authorized Signature
WYLIE REV 2002_ ORDINANCE (3).DOC
-13-
E. Form of Assignment.
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
NOTICE: The signature on this
assignment must correspond with the
guaranteed: name of the registered owner as it
appears on the face of the within Bond in
every particular.
F. The Initial Bond(s) shall be in the form set forth in paragraph 8 of this Section,
except that the form of a single fully registered 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:
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, hereby promises to pay
to the order of the Registered Owner named above, or the registered assigns thereof, solely
from the revenues hereinafter identified, the Principal Amount hereinabove stated on
February 15 in each of the years and in principal installments in accordance with the following
schedule:
"
YEAR
PRINCIPAL
INSTALLMENTS
INTEREST
RATE
(Information to be inserted from schedule in Section 2 hereof).
.-
~
(or so much thereof as shall not have been prepaid prior to maturity) and to pay interest,
computed on the basis of a 36O-day year of twelve 3O-day months, on the unpaid principal
amounts hereof from the Bond Date at the per annum rates of interest specified above; such
interest being payable on February 15 and August 15 in each year, commencing February 15,
2003. Principal i~allments of this Bond are payable in the year of maturity or on a prepayment
date to the registered owner hereof by JP Morgan Chase Bank, Dallas, Texas (the "Paying
AgentlRegistrar"), upon presentation and surrender, at its designated offices in Dallas, Texas
(the "Designated PaymentlTransfer Office"). Interest is payable to the registered owner of this
Bond whose name appears on the "Security Register" maintained by the Paying
AgentlRegistrar 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
AgentlRegistrar by check sent United States Mail, first class postage prepaid, to the address of
WYLIE REV 2002_ ORDINANCE (3).DOC
-14-
registered owner recorded in the Security Register or by such other method, acceptable to the
Paying AgenVRegistrar, requested by, and at the risk and expense of, the registered owner. 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 all purposes of this Ordinance and in particular for clarity
with respect to the issuance of the Bonds herein authorized and the pledge and appropriation of
revenues to the payment of the Bonds, the following definitions are provided:
(a) "Additional Parity Bonds" - Revenue bonds or other evidences of
indebtedness which the City reserves the right to issue or enter into, as the case
may be, in the future under the terms and conditions provided in Section 19 of
this Ordinance and which, together with the Bonds, are equally and ratably
secured by a first lien on and pledge of the Net Revenues of the Systern.
(b) "Average Annual Debt Service" - That average amount which, at
the time of computation, will be required to pay the Debt Service of obligations
when due and derived by dividing the total of such Debt Service by the number of
years then remaining before final maturity. Capitalized interest payments
provided from proceeds of Bonds Similarly Secured shall be excluded in making
the aforementioned computation.
(c) "Bonds" - The "City of Wylie, Texas, Waterworks and Sewer
System Revenue Bonds, Series 2002", dated September 15, 2002, authorized
by this Ordinance.
(d) "Bonds Similarly Secured" - Collectively the Previously Issued
Bonds, the Bonds and Additional Parity Bonds.
(e) "City" - The City of Wylie located in the County of Collin, Texas.
(f) "Debt Service" - As of any particular date of computation, with
respect to any obligations and with respect to any period, the aggregate of the
amounts to be paid or set aside by the City as of such date or in such period
for the payment of the principal of, premium, if any, and interest (to the extent not
capitalized) on such obligations; assuming, in the case of Bonds Similarly
Secured without a fIXed numerical rate, tha) such obligations bear, or would have
borne, interest at the highest rate reached, or that would have applied to such
obligations (using the index or method for computing interest applicable to such
obligations) during'the twenty-four (24) month period. next preceding the date of
computation; and further assuming in the case of obligations required to be
redeemed ;or prepaid as to principal prior to maturity, the principal amounts
thereof will be redeemed prior to maturity in accordance with the mandatory
redemption provisions applicable thereto.
(g) "Fiscal Year" - The twelve month accounting period used by the
City in connection with the operation of the System which may be any twelve
consecutive month period established by the City.
WYLIE REV 2002_ ORDINANCE (3).DOC
-15-
(h) "Government Obligations" - mean (i) direct noncallable
obligations of the United States of Arnerica, including obligations the principal of
and interest on which are unconditionally guaranteed by the United States of
America, (ii) noncallable obligations of an agency or instrumentality of the United
States, including obligations unconditionally guaranteed or insured by the agency
or instrumentality and on the date of their acquisition or purchase by the City are
rated as to investment quality by a nationally recognized investment rating firm
not less than AAA or its equivalent and (iii) noncallable Qbligations of a state or
an agency or a county, municipality, or other political subdivision of a state that
have been refunded and on the date of their acquisition or purchase by the City,
are rated as to investment quality by a nationally recognized investrnent rating
firm not less than AAA or its equivalent.
(i) "Gross Revenues" - All income, receipts and revenues of every
nature derived or received from the operation and ownership (excluding
refundable meter deposits, restricted gifts and grants in aid of construction) of the
System, including earnings and income derived frorn the investment or deposit of
moneys in any special funds or accounts cr~ted and established for the
payment and security of the Bonds Similarly Secured and other obligations
payable solely from and secured only by a lien on and pledge of the Net
Revenues.
0> "Maintenance and Operating Expenses" - All current expenses of
operating and rnaintaining the System, including all salaries, labor, materials,
repairs and extensions necessary to render efficient service; provided, however,
that only such repairs and extensions, as in the judgment of the City Council,
reasonably and fairly exercised, are necessary to maintain the operations 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 obligations payable from Net Revenues shall be.deducted in determining
"Net Revenues". Depreciation charges shall not be considered Maintenance and
Operating Expenses. Maintenance and Operating Expenses shall include
payments under contracts for the purchase of water supply, treatrnent of sewage
or other materials, goods or services for the System to the extent authorized by
law and the provisions of such contract.
(k)
hereof.
"Net Earnings" - The meaning assigned to such term in Section 19
.-
.-
(I) "Net Revenues" - Gross Revenues of the System, with respect to
any period, after deducting the System's Maintenance and Operating Expenses
during such period.
(m): "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;
WYLIE REV 2002_ ORDINANCE (3).DOC
-16-
(2) those Bonds deemed to be duly paid by the City in
accordance with the provisions of Section 28 hereof; and
(3) those Bonds that have been mutilated, destroyed,
lost, or stolen and replacement Bonds have been registered and
delivered in lieu thereof as provided in Section 30 hereof.
(n) .Previously Issued Bonds" means the (i) .City of Wylie, Texas
Waterworks and Sewer System Revenue Bonds, Series 1999", dated September
1, 1999, and originally issued in the aggregate principal amount of $1,380,000,
and (ii)"City of Wylie, Texas, Waterworks and Sewer System Revenue Bonds,
Series 2000", dated August 15, 2000, and originally is~ued in the aggregate
principal amount of $1,750,000.
(0) "Required Reserve" - The amount required to be accumulated and
maintained in the Reserve Fund under the provisions of Section 15.
(p) "System" - All properties, facilities and plants currently owned,
operated and maintained by the City for the supply, treatment, transmission and
distribution of treated potable water and the collection, treatment and disposal of
water-carried wastes, together with all future extensions, improvements,
replacements and additions thereto; provided, however, that notwithstanding the
foregoing, and to the extent now or hereafter authorized or permitted by law, the
term "System" shall not mean to include facilities of any kind which are declared
not to be a part of the System and which are acquired or constructed by or on
behalf of the City with the proceeds from the issuance of "Special Facilities
Bonds", which are hereby defined as being special revenue obligations of the
City which are not Bonds but which are payable from and secured by other liens
on and pledges of any revenues, sources or payments, not pledged to the
payment of the Bonds including, but not limited to, special contract revenues or
payments received from any other legal entity in connection with such facilities.
SECTION 11: Pledoe. The City hereby covenants and agrees that the Net Revenues of
the System, with the exception of such Net Revenues in excess of the amounts required for the
payment and security of the Bonds Similarly Secured, are hereby irrevocably pledged, equally
and ratably, to the payment and security of the Previously Issued Bonds and the Bonds
including the establishment and maintenance of the special funds created and established for
the payment and security thereof, all as hereinaft~r provided; and it is hereby ordained that the
Bonds Similarly Secured, and the interest thereon, shall constitute a first lien on the Net
Revenues of the System and be valid and binding and fully perfected from and after the date of
adoption of this Ordinance without physical delivery or transfer or transfer of control of the Net
Revenues, the filing of this Ordinance or any other act; all as provided in Chapter 1208 of the
Texas Government Code.
,
Section 1208, Government Code, applies to the issuance of the Bonds and the pledge of
the Net Revenues granted by the City under this Section 11, and such pledge is therefore valid,
effective and perfected. If Texas law is amended at any time while the Bonds are Outstanding
such that the pledge of the Net Revenues granted by the City under this Section 11 is to be
subject to the filing requirements of Chapter 9, Business & Commerce Code, then in order to
preserve to the registered owners of the Bonds the perfection of the security interest in said
pledge, the City agrees to take such measures as it determines are reasonable and necessary
WYLIE REV 2002_ ORDINANCE (3).DOC
-17-
under Texas law to comply with the applicable provisions of Chapter 9, Business & Commerce
Code and enable a filing to perfect the security interest in said pledge to occur.
SECTION 12: Rates and Charoes. For the benefit of the Holders of the Bonds and in
addition to all provisions and covenants in the laws of the State of Texas and in this Ordinance,
the City hereby expressly stipulates and agrees, while any of the Bonds are Outstanding, to
establish and maintain rates and charges for facilities and services afforded by the System that
are reasonably expected, on the basis of available information and experience and with due
allowance for contingencies, to produce Gross Revenues in eac~ Fiscal Year suffICient:
(a) To pay Maintenance and Operating Expenses, depreciation
charges and replacement and betterment costs,
(b) To produce Net Revenues sufficient to pay the principal of and
interest on the Bonds Similarly Secured and the amounts required to be
deposited in any reserve or contingency fund created for the payment and
security of the Bonds Similarly Secured, and other obligations or evidences of
indebtedness issued or incurred that are payable only from and secured solely by
a lien on and pledge of the Net Revenues of the System, and
(c) To produce Net Revenues equal to at least 1.20 times the
Average Annual Debt Service for the then outstanding Bonds Similarly Secured.
SECTION 13: Water and Sewer System Fund. The City hereby covenants and agrees
that Gross Revenues of the System (excluding earnings and income derived from the
investment or deposit of moneys in the Bond Fund and Reserve Fund) shall be deposited, as
collected and received, into a separate account (created, established and maintained with a
depository bank of the City) known as the "Water and Sewer System Fund" (herein called the
"System Fund") and the Gross Revenues of the System shall be kept separate and apart from
all other funds of the City. All revenues deposited in the System Fund shall be pledged and
appropriated to the extent required for the following uses and in the order of priority shown:
FIRST: To the payment of all necessary and reasonable Maintenance
and Operating Expenses as defined herein or required by statute to be a first
charge on and claim against the Gross Revenues thereof.
SECOND: To the payment of the amounts required to be deposited in the
Bond Fund created and established for the payment of Debt Service on the
Bonds Similarly Secured as the same becOmes due and payable.
THIRD: To the payment of the amounts required to be deposited in the
Reserve Fund to establish and maintain the Required Reserve in accordance
with the provisions of this Ordinance or any other ordinance relating to issuance
of BondsSI.milarly Secured.
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.
SECTION 14: Bond Fund. For purposes of providing funds to pay the principal of and
interest on the Bonds Similarly Secured as the same becomes due and payable, the City hereby
WYLIE REV 2002_ ORDINANCE (3).DOC
-18-
covenants and agrees to maintain at a depository bank of the City a separate and special
account or fund known as the "City of Wylie Interest and Sinking Revenue Bond Fund" (the
"Bond Fund"). In addition to the payments for the Previously Issued Bonds, the City covenants
that there shall be deposited from the Net Revenues into the Bond Fund prior to each principal
and interest payment date an amount equal to one hundred per centurn (100%) of the amount
required to fully pay the interest on and the principal of the Bonds then falling due and payable,
such deposits to pay maturing principal and accruing, interest on the Bonds to be made in
substantially equal monthly installments on or before the 1st day of each month, beginning on or
before the 1- day of the. month next followingth"e-month the Bonds are delivered to the initial
purchaser(s). If the Net Revenues in any month are insufficient to make the required payments
into the Bond Fund, then the amount of any deficiency in the payment shall be added to the
amount otherwise required to be paid into the Bond Fund in the next month.
The required monthly deposits to the Bond Fund for the payment of principal of and
interest on the Bonds shall continue to be made as hereinabove provided until such time as
(i) the total amount on deposit in the Bond Fund and Reserve Fund is equal to the amount
required to fully pay and discharge all outstanding Bonds Similarly Secured (principal and
interest) or (ii) the Bonds are deemed to be paid in accordance with the provisions of Section 28
hereof.
Accrued interest and premium, if any, received from the purchaser(s) of the Bonds, as
well as earnings derived from the investment of rnoneys in the Bond Fund and any proceeds of
the Bonds not required to complete the improvements and extensions to the System and
deposited in the Bond Fund, shall be taken into consideration and reduce the amount of the
monthly deposits otherwise required to be deposited in the Bond Fund from the Net Revenues
of the System.
SECTION 15: Reserve Fund. For purposes of accumulating and maintaining funds as a
reserve for the payment of the Bonds Similarly Secured, the City hereby covenants and agrees
to maintain a separate and special fund or account known as the "City of Wylie Revenue Bond
Reserve Fund" (the "Reserve Fund"), and all funds deposited therein (excluding earnings and
income derived or received from deposits or investments which may be transferred to the
System Fund referenced in Section 13 hereof during such periods as there is on deposit in the
Reserve Fund the Required Reserve) shall be used solely for the payment of the principal of
and interest on the Bonds Similarly Secured, when and to the extent other funds available for
such purposes are insufficient, and, in addition, may be used to the extent not required to
maintain the "Required Reserve", to pay, or provide for the payment of, the final principal
amount of a series of Bonds Similarly Secured so that such series of Bonds Similarly Secured is
no longer deemed to be "Outstanding" within the hleaning of Section 28 hereof.
In accordance with the ordinance authorizing the issuance of the Previously Issued
Bonds, the amount currently on deposit to the credit of the Reserve Fund is in excess of $_
(the .Old Reserve"). By reason of the issuance of the Bonds, the amount to be
accumulated and maintained in said Fund shall be increased to an arnount equal to $_ (the
.Required Reserve"), which amount is hereby found to equal or exceed the Average Annual
Debt Service for the outstanding Bonds Similarly Secured after giving effect to the issuance of
the Bonds (calculated on a Fiscal Year basis as of the date the Bonds are to be delivered).
The City agrees that there shall be deposited to the credit of the Reserve Fund from the Net
Revenues of the System on or before the 1- day of the month next following the month the
Bonds are delivered to the initial purchasers and on or before the 1 st day of each following
month an amount equal to at least 1160th of the difference between the Required Reserve and
WYLIE REV 2002_ ORDINANCE (3).DOC
-19-
the Old Reserve until the Required Reserve has been fully accumulated in the Reserve Fund.
As and when Additional Parity Bonds are delivered or incurred, the Required Reserve
shall be increased, if required, to an amount equal to not less than the Average Annual Debt
Service (calculated on a Fiscal Year basis) for all Bonds Similarly Secured then outstanding, as
determined on the date each series of Bonds are delivered or incurred, as the case may be.
Any additional amount required to be maintained in the Reserve Fund shall be so accumulated
by the deposit in the Reserve Fund of all or any part thereof in cash immediately after the
delivery of the then proposed Additional Parity Bonds, or, at the option of the City, by the
deposit of monthly installments, made on or before the 1 st day of each month following the
month of delivery of the then proposed Additional Parity Bonds, of not less than 1160th of the
additional amount to be maintained in said Fund by reason of the issuance of the Additional
Parity Bonds then being issued (or 1/6Oth of the balance of the additional amount not deposited
irnrnediately in cash).
While the cash and investments in the Reserve Fund total not less than the Required
Reserve, no deposits need be made to the credit of the Reserve Fund; but, if and when the
Reserve Fund at any time contains less than the Required Reserve (other than as the result of
the issuance of Additional Parity Bonds as provided in the preceding paragraph), the City
covenants and agrees to cure the deficiency in the Required Reserve by making monthly
deposits to said Fund from the Net Revenues of the System, such monthly deposits to be in
amounts equal to not less than 1/6Oth of the then total Required Reserve to be maintained in
said Fund and to be rnade on or before the 1 st day of each month until the total Required
Reserve then to be maintained in said Fund has been fully restored. The City further covenants
and agrees that, subject only to the payments to be made to the Bond Fund, the Net Revenues
shall be applied and appropriated and used to establish and maintain the Required Reserve and
to cure any deficiency in such amounts as required by the terms of this Ordinance and any other
ordinance pertaining to the issuance of Bonds Similarly Secured.
During such time as the Reserve Fund contains the total Required Reserve, the City
may, at its option, withdraw all surplus in the Reserve Fund in excess of the Required Reserve
and deposit such surplus in the System Fund. The City hereby designates its depository bank
or banks as the custodian of the Reserve Fund.
Notwithstanding anything herein to the contrary, the City retains the right to fund the
Required Reserve in whole or in part with a surety bond or insurance policy issued by an
insurance company or other entity that is rated either for the long term unsecured debt of the
issuer of such surety bond or for obligations insured, secured or guaranteed by such issuer
-
have a rating in the highest letter category by two major municipal securities rating or
evaluation services, and money deposited to the credit of the Reserve Fund may be used to
make any payments required to satisfy the City's repayment obligation to the issuer of such
surety bond or insurance Policy in the same manner and with like effect as if such payments
were being used to accumulate, maintain or restore the Required Reserve in cash or with
authorized investments.
SECTION 16: Deficiencies: Excess Net Revenues. (a) If on any occasion there shall
not be suffICient Net Revenues of the System to make the required deposits into the Bond Fund
and the Reserve Fund, then such deficiency shall be cured as soon as possible from the next
available Net Revenues of the System, or from any other sources available for such purpose.
(b) Subject to making the required deposits to the Bond Fund and the Reserve Fund
WYLIE REV 2002_ ORDINANCE (3).DOC
-20-
when and as required by this Ordinance, or any ordinance authorizing the issuance of Bonds
Similarly Secured, the excess Net Revenues may be used by the City for any lawful purpose.
SECTION 17: Payment of Bonds. While any of the Bonds are Outstanding, the City's
chief financial officer shall cause to be transferred to the Paying Agent/Registrar therefor, from
funds on deposit in the Bond Fund, and, if necessary, in the Reserve Fund, amounts sufficient
to fully pay and discharge promptly as each installment of interest and principal of the Bonds
accrues or matures or comes due by reason of redemption prior to maturity; such transfer of
funds to be made in such manner as will cause immediately available funds to be deposited with
the Paying AgenVRegistrar for the Bonds at the close of the business day next preceding the
date of payment for the Bonds.
SECTION 18: Investments - Security of Funds. (a) Money in any Fund referred
to in this Ordinance may, at the option of the City, be placed in time deposits or certificates of
deposit secured (to the extent not insured by the Federal Deposit Insurance Corporation) by
obligations of the type hereinafter described, or be invested, including investments held in
book-entry form, in direct obligations of the United States of America, obligations guaranteed or
insured by the United States of America, which, in the opinion of the Attorney General of the
United States, are backed by its full faith and credit or represent its general obligations, or
invested in indirect obligations of the United States of America, including, but not limited to,
evidences of indebtedness issued, insured or guaranteed by such governmental agencies as
the Federal Land Banks, Federal Intermediate Credit Banks, Banks for Cooperatives, Federal
Home Loan Banks, Government National Mortgage Association, Farmers Home Administration,
Federal Home Loan Mortgage Association, or Federal Housing Association; provided that all
such deposits and investments shall be made in such a manner that the money required to be
expended from any Fund will be available at the proper time or times. Such investrnents
(except State and Local Government Series investments held in book entry form, which shall at
all times be valued at cost) shall be valued in terms of current market value within 45 days of the
close of each Fiscal Year and, with respect to investments held for the account of the Reserve
Fund, within 30 days of the date of passage of each ordinance authorizing the issuance of
Additional Parity Bonds. All interest and income derived from deposits and investments in the
Bond Fund immediately shall be credited to, and any losses debited to, the Bond Fund. All
interest and interest income derived from deposits in and investments of the Reserve Fund
shall, subject to the limitations provided in Section 14 hereof, be credited to and deposited in the
Bond Fund. All such investments shall be sold promptly when necessary to prevent any default
in connection with the Bonds.
(b) Money in all Funds created by this Qrdinance, to the extent not invested, shall be
secured in the manner and to the fullest extent required by the laws of the State of Texas for the
security of public funds.
SECTION 19: Issuance of Additional Parity Oblioations. Subject to the provisions
hereinafter appearing as to conditions precedent which must be satisfied, the City reserves the
right to issue, from time to time as needed, Additional Parity Bonds for any lawful purpose.
Such Additional Parity Bonds may be issued in such form and manner as now or hereafter
authorized by the laws of the State of Texas for the issuance of evidences of indebtedness or
other instruments, and should new methods or financing techniques be developed that differ
from those now available and in normal use, the City reserves the right to employ the same in
its financing arrangements provided only that the following conditions precedent for the
authorization and issuance of the same are satisfied, to wit:
WYLIE REV 2002_ ORDINANCE (3).DOC
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(a) The Director of Finance of the City (or other officer of the City then
having the primary responsibility for the financial affairs of the City) shall have
executed a certificate stating (a) that, to the best of their knowledge and belief,
the City is not then in default as to any covenant, obligation or agreement
contained in any ordinance or other proceeding relating to any obligations of the
City payable from and secured by a lien on and pledge of the Net Revenues of
the System that would materially affect the security or payrnent of such
obligations and (b) either (i) payments into all special funds or accounts created
and established for the payment and security of all outstanding obligations
payable from and secured by a lien on and pledge of the Net Revenues of the
System have been made and that the amounts on deposit in such special funds
or accounts are the amounts then required to be on deposit therein or (ii) the
application of the proceeds of sale of such obligations then being issued will cure
any such deficiency.
(b) The Additional Parity Bonds shall be scheduled to mature or be
payable as to principal on February 15 or August 15 (or both) in each year the
same are to be outstanding or during the term thereof.
(c) The City has secured a certificate or opinion of a Certified Public
Accountant to the effect that, according to the books and records of the City, the
Net Earnings, for the preceding Fiscal Year or for 12 consecutive months out of
the 15 months immediately preceding the month the ordinance authorizing the
issuance of the Additional Parity Bonds is adopted, are at least equal to 1.25
times the Average Annual Debt Service for all outstanding Bonds Similarly
Secured after giving effect to the issuance of the Aclditional Parity Bonds then
being issued. In making a determination of the Net Earnings, the Accountant
may take into consideration a change in the rates and charges for services and
facilities afforded by the System that became effective at least sixty (60) days
prior to the last day of the period for which Net Earnings are determined and, for
purposes of satisfying the above Net Earnings test, make a pro forma
determination of the Net Earnings of the System for the period of time covered by
his certifICation or opinion based on such change in rates and charges being in
effect for the entire period covered by the Accountant's certificate or opinion.
As used in this Section, the term "Net Earnings" shall mean the Gross Revenues of the
System after deducting the Maintenance and Operating Expenses of the System, but not
depreciation charges or expenditures which, under generally accepted accounting principles,
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should be charged to capital expenditures. ~
SECTION 20: Refundino Bonds. The City reserves the right to issue refunding bonds to
refund all or any part of the outstanding Bonds Similarly Secured (pursuant to any law then
available) upon such terms and conditions as the City Council ofthe City may deem to be in the
best interest of the' City and its inhabitants, and if less than all such outstanding Bonds Similarly
Secured are refunded, the conditions precedent prescribed (for the issuance of Additional Parity
Bonds) set forth in subparagraph (c) of Section 19 shall be satisfied and the Accountant's
certificate or opinion required in subparagraph (c) shall give effect to the Debt Service of the
proposed refunding bonds (and shall not give effect to the Debt Service of the Bonds Similarly
Secured being refunded following their cancellation or provision being made for their payment).
WYLIE REV 2002_ ORDINANCE (3).DOC
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SECTION 21: Oblioations of Inferior Lien and Pledoe. The City hereby reserves the
right to issue obligations payable from and secured by a lien on and pledge of the Net
Revenues of the System, junior and subordinate in rank and dignity to the lien and pledge
securing the payment of the Bonds Similarly Secured, as may be authorized by the laws of the
State of Texas.
SECTION 22: Maintenance and Operation - Insurance. The City covenants that the
System shall be maintained in good condition and operated in an efficient manner and at
reasonable cost. While any Bonds are Outstanding, the City agrees to maintain casualty and
other insurance on the Systern of a kind and in an amount customarily carried by municipal
corporations engaged in a similar type of business. Nothing in this Ordinance shall be
construed as requiring the City to expend any funds derived from sources other than the
operation of the System, but nothing herein shall be construed as preventing the City from doing
so.
SECTION 23: Sale or Lease of Properties. The City, to the extent and in the manner
authorized by law, may sell or exchange for consideration representing the fair value thereof, as
determined by the City Council of the City, any property not necessary or required in the
efficient operations of the Systern, or any equipment not necessary or useful in the operations
thereof or which is obsolete, damaged or worn out or otherwise unsuitable for use in the
operation of the System. The proceeds of any sale of properties of the System shall be
deposited in the Systern Fund.
SECTION 24: Records and Accounts. The City hereby covenants and agrees that while
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 V.T.CA., Government Code,
Chapter 1502 or other applicable law. The Holders of any Bonds or any duly authorized agent
or agents of such Holders shall have the right at all reasonable times to inspect such records,
accounts and data relating thereto, and to inspect the System and all properties comprising
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.
Each such audit, in addition to whatever other matters may be thought proper by the
Accountant, shall particularly include the following:
(a) A statement of the income and expenses of the System for such
Fiscal Year.
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(b) A balance sheet for the System as of the end of such Fiscal Year.
(c) A statement describing the sources and application of funds of the
System for such FiScal Year.
(d): The Accountant's comments regarding the manner in which the
City has carried out the requirements of this Ordinance and any other ordinance
authOrizing the issuance of Bonds Similarly Secured and his recommendations
for any changes or irnprovements in the operations, records and accounts of the
System.
WYLIE REV 2002_ ORDINANCE (3).DOC
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(e) A list of insurance policies in force at the end of the Fiscal Year
covering the properties of the System, setting out as to each policy the amount
thereof, the risk covered, the name of the insurer and the policy's expiration date.
Expenses incurred in making an annual audit of the operations of the System are to be
regarded as Maintenance and Operating Expenses. 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 request, to the original purchaser of the Bonds and subsequent
holders or owners of any of said Bonds. The audits herein required shall be made within 120
days following the close of each Fiscal Year insofar as is possible.
SECTION 25: Special Covenants. The City further covenants and agrees by and
through this Ordinance as follows:
(a) It has the lawful power to pledge the Net Revenues of the System
to the payment of the Bonds to the extent provided herein and has lawfully
exercised said power under the Constitution and laws of the State of Texas, and
that the Bonds issued hereunder, together with the Previously Issued Bonds and
Additional Parity Bonds, if issued, shall be ratably secured in such manner that
no one Bond shall have preference over any other Bond of said issues.
(b) The Net Revenues of the System have not been in any manner
pledged or encumbered to the payment of any debt or obligation of the City or
the System, save and except for the Previously Issued Bonds, the Bonds and the
outstanding "City of Wylie, Texas, Tax and Waterworks and Sewer System
Surplus Revenue Refunding Bonds, Series 1993".
(c) No free services of the System shall be allowed, and should the
City or any of its agents or instrumentalities make use of the services and
facilities of the System, payment of the reasonable value thereof shall be made
by the City out of funds from sources other than the revenues and income of the
System.
(d) To the extent that it legally may, the City further covenants and
agrees that, while the Bonds are Outstanding, no franchise shall be granted for
the installation or operation of any waterworks or sewer system other than those
owned by the City, and the operation of any such system by anyone other than
this City is hereby prohibited.
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(e) The City will comply with all of the terms and conditions of any and
all franchises, permits and authorizations applicable to or necessary with respect
to the System, and which have been obtained from any governmental agency;
and the City has or will obtain and keep in full force and effect all franchises,
permits, auJhorizations and other requirements applicable to or necessary with
respect to the acquisition, construction, equipment, operation and maintenance
of the System.
SECTION 26: Remedy in Event of Default. In addition to all 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 payments to be made to the Bond Fund or the Reserve Fund as
required by this Ordinance or (b) defaults in the observance or performance of any other of the
WYLIE REV 2002_ ORDINANCE (3).DOC
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covenants, conditions or obligations set forth in this Ordinance, the Holders of any of the Bonds
shall be entitled to a writ of mandamus issued by a court of proper jurisdiction, compelling and
requiring the City and its officers to observe and perform any covenant, condition or obligation
prescribed in this Ordinance. 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 remedy herein provided shall be cumulative of all other existing remedies
and the specification of such remedy shall not be deemed to be exclusive.
SECTION 27: Special Oblioations. The Bonds are special obligations of the City
payable from the pledged Net Revenues of the System and the Holders thereof shall never
have the right to demand payment thereof out of funds raised or to be raised by taxation.
SECTION 28: Satisfaction of Oblioation of City. 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 the
Net Revenues of the System under this Ordinance and all other obligations of the City to the
Holders shall thereupon cease, terminate, and become void and be discharged and satisfied.
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 AgenVRegistrar, or an authorized escrow agent, or (ii) Governrnent
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 AgentlRegistrar 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.
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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 AgentlRegistrar for the payment of the
principal of and interest on the Bonds and remaining unclaimed for a period of three (3) 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 AgentlRegistrar to the City shall be subject to any applicable unclairned
property laws of the State of Texas.
WYLIE REV 2002_ ORDINANCE (3).DOC
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SECTION 29: Ordinance a Contract - Amendments. This Ordinance shall constitute a
contract with the Holders from time to tirne, 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 detrirnental to the interests of the Holders,
including the curing of any ambiguity, inconsistency, or formal defect or omission herein. In
addition, the City may, with the written consent of Holders hOlding a majority in aggregate
principal amount of the Bonds Similarly Secured 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 the Bonds then outstanding, 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 arnount 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 30: Mutilated - Destroved - Lost and Stolen Bonds. In case any Bond shall
be mutilated, or destroyed, lost or stolen, the Paying AgentlRegistrar may execute and deliver a
replacement Bond of like form and tenor, and in the same denornination 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 stoien 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 indernnity and with the preparation,
execution and delivery of a replacernent Bond shall be borne by the Holder of the Bond
rnutilated, or destroyed, lost or stolen.
Every new Bond issued pursuant to this Section in lieu of any rnutilated, destroyed, lost,
or stolen Bond shall constitute a replacement of the prior obligation of the City, whether or not
the mutilated, destroyed, lost, or stolen Bond shall be at any tirne enforceable by anyone, and
shall be entitled to all the benefits of this Ordinance equally and ratably with all other
Outstanding Bonds.
The provisions of this Section are exclusive and shall preclude (to the extent lawful) all
other rights and remedies with respect to the repla~ement and payrnent of rnutilated, destroyed,
lost, or stolen Bonds. !'
SECTION 31: 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 as it appears in the Security Register.
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 rnailed, 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
WYLIE REV 2002_ ORDINANCE (3).DOC
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the Paying AgentlRegistrar, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
SECTION 32: Cancellation. All Bonds surrendered for payment, redemption, transfer or
exchange, if surrendered to the Paying AgentlRegistrar, shall be promptly cancelled by it and, if
surrendered to the City, shall be delivered to the Paying AgentlRegistrar and, if not already
cancelled, shall be promptly cancelled by the Paying AgentlRegistrar. 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 AgentlRegistrar. All cancelled
Bonds held by the Paying Agent/Registrar shall be destroyed as directed by the City.
SECTION 33: Covenants to Maintain Tax-Exempt Status. (a) Definitions.
used in this Section 33, the following terms 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.
When
"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.
"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
WYLIE REV 2002_ ORDINANCE (3).DOC
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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, 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 than a state or local govemment, 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, 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.
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(e) Not to Invest at Hioher 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 Federallv 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.
(g) Information Report. The City shall timely file the information required by section
WYLIE REV 2002_ ORDINANCE (3).DOC
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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) No Rebate Reauired. The City warrants and represents that it satisfies the
requirements of paragraph (2) and (3) of section 148(f) of the Code with respect to the Bonds
without making the payments for the United States described in such section. Specifically, the
City warrants and represents that
(1) the City is a governmental unit with general taxing powers;
(2) at least 95% of the net proceeds of the Bonds will be used for the
local governmental activities of the City;
(3) the aggregate face amount of all tax-exempt obligations issued or
expected to be issued by the City (and all subordinate entities thereof) in the
calendar year in which the Bonds are issued is not reasonably expected to
exceed $5,000,000.
(j) Elections. The City hereby directs and authorizes the Mayor, City Secretary, City
Manager, Assistant City Manager, and Director of Finance, individually or jointly, 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) Qualified Tax Exempt Oblioations. 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 "private activity bonds"
as defined in the Code and represents the amount of "tax exernpt obligations" to be issued by
the City (including all subordinate entities of the City) for the calendar year 2002 will not exceed
$10,000,000.
SECTION 34: Sale of Bonds. Pursuant to a public sale for the Bonds, the bid submitted
by (herein referred to as the "Purchasers") is declared to be
the best bid received producing the lowest true interest cost rate to the City; such bid is hereby
accepted and incorporated herein by reference as a part of this Ordinance for all purposes and
the sale of the Bonds to said Purchasers at the price of par and accrued interest to the date of
delivery, plus a premium of $ , is hereby approved and confirmed. Delivery of the Bonds
to the Purchasers shall occur as soon as pos$ible upon -Payment being made therefor in
accordance with the terms of sale. .'
SECTION 35: Official Statement. The use of the Preliminary Official Statement, dated
September 13, 2002, in the offering and sale of the Bonds is hereby ratified, confirmed and
approved in all. respects, and the City Council hereby finds that the information and data
contained in said Preliminary Official Statement pertaining to the City and its financial affairs is
true and correct in all material respects and no material facts have been omitted therefrom
which are necessary to make the statements therein, in light of the circurnstances under which
they were made, not misleading. The final OffICial Statement, which reflects the terms of sale
(together with such Changes approved by the Mayor, City Secretary, City Manager of Director of
Rnance, one 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
September 24, 2002, in the reoffering, sale and delivery of the Bonds to the public.
WYLIE REV2002_0RDINANCE (3).DOC
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SECTION 36: Control and Custody of Bonds. The Mayor 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 prirrting and supply of
definitive Bonds, and shall take and have charge and control of the Initial Sond(s) 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, City Secretary, City Manager and Director of Finance, anyone
or more of said officials, are hereby authorized and directed to fumish and execute such
docurnents 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, their 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 AgentlRegistrar, make the necessary arrangements for the delivery of
the Initial Bond(s) to the Purchasers and the initial exchange thereof for definitive Bonds.
SECTION 37: Proceeds of Sale. The proceeds of sale of the Bonds, excluding the
accrued interest received from the purchasers, shall be deposited in a construction fund
rnaintained at the City's depository bank. Pending expenditure for authorized projects and
purposes, such proceeds of sale may be invested in authorized investments in accordance with
the provisions of V.T.C.A., Government Code, Chapter 2256, including guaranteed investment
contracts permitted by V.T.C.A., Section 2256.015 et seq., and the City's investment policies
and guidelines, and any investment earnings realized shall be expended for such authorized
projects and purposes or deposited in the Interest and Sinking Fund as shall be determined by
the City Council. Accrued interest and premium, if any, received from the sale of the Bonds and
any excess bond proceeds, including investment earnings, remaining after completion of all
authorized projects or purposes shall be deposited to the credit of the Bond Fund.
SECTION 38: Leoal Opinion. 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 is hereby authorized to be printed on the definitive Bonds or an executed counterpart
thereof shall accompany the global Bonds deposited with the Depository Trust Company.
SECTION 39: 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 Bonds shall be of no sIgnificance or effect as regards the legality
thereof and neither the City nor attorneys approving said Bonds as to legality are to be held
responsible for CUSIP numbers incorrectly printed or typed on the definitive Bonds.
SECTION 40: Benefits 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
AgentlRegistrar 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 41: Inconsistent Provisions. All ordinances, orders or resolutions, or parts
thereof, which are in conflict or inconsistent with any provision of this Ordinance are hereby
WYLIE REV 2002_ ORDINANCE (3).DOC
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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 42: Governino 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 43: Severability. If any provision of this Ordinance or the application thereof
to any circumstance shall be held to be invalid, the remainder of this Ordinance and the
application thereof to other circumstances shall nevertheless be valid, and the Council hereby
declares that this Ordinance would have been enacted without such invalid provision.
SECTION 44: 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 45: Continuino Disclosure Undertakino. (a) Definitions. As used in this
Section, the following terms have the meanings ascribed to such terms below:
"MSRB' means the Municipal Securities Rulemaking Board.
"NRMSIR" means each person whom the SEC or its staff has determined to be a
nationally recognized municipal securities information repository within the meaning of the Rule
from time to time.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC' means the United States Securities and Exchange Commission.
"SID" means any person designated by the State of Texas or an authorized department,
officer, or agency thereof as, and determined by the SEC or its staff to be, a state information
depository within the meaning of the Rule from time to time.
(b) Annual Reports. The City shall provide annually to each NRMSIR and any SID,
within six months after the end of each fiscal year (beginning with the fiscal year ending
September 30, 2002) financial information and operating data with respect to the City of the
general type included in the final Official Statement approved by Section 35 of this Ordinance,
being the information described in Exhibit 8 hereto. Financial statements to be provided shall
be (1) prepared in accordance with the accounting principles described in Exhibit 8 hereto and
(2) audited, if the City commissions an audit of such statements and the audit is completed
within the period during which they must be provided. If audited financial statements are not
available at the time the financial information and operating data must be provided, then the City
shall provide unaudited financial statements for the applicable fiscal year to each NRMSIR and
any SID with the financial information and operating data and will file the annual audit report
when and if the same becomes available.
If the City changes its fiscal year, it will notify each NRMSIR and any SID of the change
(and of the date of the new fiscal year end) prior to the next date by which the City otherwise
would be required to provide financial information and operating data pursuant to this Section.
The financial information and operating data to be provided pursuant to this Section may
WYLIE REV 2002_ ORDINANCE (3).DOC
-31-
be set forth in full in one or more documents or may be included by specific reference to any
document (including an official statement or other offering document, if it is available from the
MSRB) that theretofore has been provided to each NRMSIR and any SID or filed with the SEC.
(c) Material Event Notices. The City shall notify any SID and either each NRMSIR or
the MSRB, in a timely manner, of any of the following events with respect to the Bonds, if such
event is material within the meaning of the federal securities laws:
1. Principal and interest payment delinquencies;
2. Non-payment related defaults;
3. Unscheduled draws on debt service reserves reflecting financial difficulties;
4. Unscheduled draws on credit enhancements reflecting financial difficulties;
5. Substitution of credit or liquidity providers, or their failure to perform;
6. Adverse tax opinions or events affecting the tax-exernpt status of the Bonds;
7. Modifications to rights of holders of the Bonds;
8. Bond calls;
9. Defeasances;
10. Release, substitution, or sale of property securing repayrnent of the Bonds; and
11. Rating changes.
The City shall notify any SID and either each NRMSIR or the MSRB, in a timely manner,
of any failure by the City to provide financial information or operating data in accordance with
subsection (b) of this Section by the time required by such Section.
(d) Limitations, Disclaimers, and Amendments. The City shall be obligated to
observe and perform the covenants specified in this Section while, but only while, the City
remains an "obligated person" with respect to the Bonds within the rneaning of the Rule, except
that the City in any event will give the notice required by subsection (c) hereof of any Bond calls
and defeasance that cause the City to be no longer such an "obligated person."
The provisions of this Section are for the sole benefit of the Holders and beneficial
owners of the Bonds, and nothing in this Section, express or implied, shall give any benefit or
any legal or equitable right, remedy, or claim hereunder to any other person. The City
undertakes to provide only the financial information, operating data, financial staternents, and
notices which it has expressly agreed to provide pursuant to this Section and does not hereby
undertake to provide any other information that may be relevant or material to a complete
presentation of the City's financial results, condition, or prospects or hereby undertake to update
any information provided in accordance with this Section or otherwise, except as expressly
provided herein. The City does not make any Tepresentation or warranty concerning such
information or its usefulness to a decision to invest in or sell Bonds at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR
BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT,
FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE CITY,
WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT
SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON,
IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE
LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE.
No default by the City in observing or performing its obligations under this Section shall
constitute a breach of or default under this Ordinance for purposes of any other provision of this
WYLIE REV 2002_ ORDINANCE (3).DOC
-32-
Ordinance.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the
duties of the City under federal and state securities laws.
The provisions of this Section may be amended by the City from time to time to adapt to
changed circumstances resulting from a change in legal requirements, a change in law, or a
change in the identity, nature, status, or type of operations of the City, but only if (1) the
provisions of this Section, as so amended, would have permitted an underwriter to purchase or
sell Bonds in the primary offering of the Bonds in compliance with the Rule, taking into account
any amendments or interpretations of the Rule to the date of such amendment, as well as such
changed circumstances, and (2) either (a) the Holders of a rnajority in aggregate principal
amount (or any greater amount required by any other provision of this Ordinance that authorizes
such an amendment) of the outstanding Bonds consent to such amendrnent or (b) a Person that
is unaffiliated with the City (such as nationally recognized bond counsel) determines that such
amendment will not materially impair the interests of the Holders and beneficial owners of the
Bonds. The provisions of this Section may also be amended from time to time or repealed by
the City if the SEC amends or repeals the applicable provisions of the Rule or a court of final
jurisdiction determines that such provisions are invalid, but only if and to the extent that
reservation of the City's right to do so would not prevent underwriters of the initial public offering
of the Bonds from lawf8uilly purchasing or selling Bonds in such offering. If the City so amends
the provisions of this Section, it shall included with any amended financial information or
operating data filed with each NRMSIR and SID pursuant to subsection (b) of this Section an
explanation, in narrative form, of the reasons for the arnendment and of the impact of any
change in the type of financial information or operating data so provided.
SECTION 46: Public Meetino. 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 rneeting, including this
Ordinance, was given, all as required by V.T.C.A., Government Code, Chapter 551, as
amended.
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WYLIE REV 2002_ ORDINANCE (3).DOC
-33-
SECTION 47: Effective Date. This Ordinance shall be in force and effect from and after
its passage on the date shown below and it is so ordained.
PASSED AND ADOPTED, this September 24, 2002.
ATTEST:
(City Seal)
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-
WYLIE REV 2002_ ORDINANCE (3).DOC
-34-
Exhibit B
to
Ordinance
DESCRIPTION OF ANNUAL FINANCIAL INFORMATION
The following information is referred to in Section 45 of this Ordinance.
Annual Financial Statements and Operating Data
The financial information and operating data with respect to the City to be provided
annually in accordance with such Section are as specified (an included in the Appendix or under
the headings of the Official Statement referred to) below:
1. The financial statements of the City appended to the Official Statement as
Appendix B, but for the most recently concluded fiscal year.
2. The information contained in Tables 1 through 11 of the OffICial
Statement.
Accounting Principles
The accounting principles referred to in such Section are the generally accepted
accounting principles as applicable to governmental units as prescribed by The Government
Accounting Standards Board.
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WYLIE REV 2002_ ORDINANCE (3).DOC
ExhIbit B to Ordinance
THE WYLIE NEWS
Covering Wylie, Sachse, Murphy and the surrounding area
liON. Ballard St.
P.O. Box 369
Wylie, Texas 75098
972.442.5515
Fax 972.442.4318
STATE OF TEXAS
COUNTY OF COLLIN
Before me, the undersigned authority, on this day personally appeared Chad Engbrock, of THE WYLIE
NEWS, a newspaper regularly published in Collin County, Texas and having general circulation in CoUin
County, Texas, who being by me duly sworn deposed and says that the foregoing attached
fJ-nR. _ /NO, ~ 0 oc1 ~3 ~/
was published in said newspaper on the following dates, to-wit:
t2{.-I. ;l..
, 2002, and
, 2002.
~
--.,
'~\~
Subscribed and sworn to before me this the ~:---
to certify which witness my hand and seal of office.
day of tuov R..,y~~..)..e_A.-
, 2002,
WlhY-ll2."\.
J\...-
SUMMElIt R. LADUE
Notary Public
Slate of Texaa
My Comm. Exp. 12-30-05
otary Public in and for
he State of Texas
My Commission Expires J ~:L- -:sO._~
Public Notices
Engineering Conference
Room. Representatives of
Owner and Consulting
Engineer will be present to
discuss the Project.
Bids will be received on a
lump sum basis.
Bid security in the amount
of 5 percent of the Bidder's
maximum bid must accom-
pany each Bid.
The Successful Bidder will
be required to furnish a
Performance Bond and a
Payment Bond as security
for the faithful perfor-
mance and the payment of
all bills and obligations
arising from the perfor-
mance of the Contract. No
Bid may be withdrawn
within a period of 60 days
after the date fixed for
opening Bids.
Owner reserves the right to
reject any or all Bids,
including without limita-
tion the rights to reject any
or all nonconforming, non-
responsive, unbalanced, or
conditional Bids, and to
reject the Bid of any
Bidder if Owner believes
that it would not be in the
best interest of Owner to
make an award to that
Bidder. Owner also
reserves the right to waive
informalities.
If the Contract is the be
awarded, Owner will give
the Successful Bidder a
Notice Award within the
number of days set forth in
the Bid For.
NORTH
MUNICIPAL
TEXAS
WATER
AN ORDINANCE
AUTHORIZING THE
ISSUANCE OF "CITY OF
WYLIE, TEXAS,
WATERWORKS AND
SEWER SYSTEM REV-
ENuE BONDS, SERIES
2002"; PLEDGING THE
NET REVENUES OF
THE CITY'S WATER-
WORKS AND SEWER
SYSTEM TO THE PAY-
MENT OF THE PRINCI-
PAL OF AND INTEREST
ON SAID BONDS;
ENACTING PROVI-
SIONS INCIDENT AND
RELATED TO THE
ISSUANCE, PAYMENT,
SECURITY AND DELIV-
ERy OF SAID BONDS,
INCLUDING THE
APPROVAL AND EXE-
CUTION OF A PAYING
A public hearing will be AGENT/REGISTRAR
held by and before the AGREEMENT AND THE
Sachse Economic APPROVAL AND DIS-
Development Corporation TRIBUTION OF AN
of the City of Sachse, OFFICIAL STATEMENT
Texas on the 9th day of PERTAINING THERETO;
October, 2002 at 7:00 p.m. AND PROVIDING AN
in the City Council EFFECTIVE DATE.
Chamber of City Hall of PASSED AND
the City of Sachse, 5560 APPROVED by the City
Highway 78, Sachse, Council of the City of
Texas, for all persons inter- Wylie, Texas, this 24th day
ested in the above 4B of September 2002.
Project. At said time and \
place, all such persons JOHN MONDY, MAYOR \"
shall have the right to ATIEST: ORDINANCE NO.
appear and be heard. Of all BARBARA SALINAS 2002-36
said matters and things, all CITY SECRETARY
persons interested in the , 19-1t-3~ AN ORDINANCE
things and matters herein/'ll '\. AUTHORIZING THE
mentioned, will take 0\ ORDINANCE NO. ISSUANCE OF "CITY OF
notice. 19-1t-1370 \ 2002-35 WYLIE, TEXAS, GEN-
AN ORDINANCE ERAL OBLIGATION
Public Notices
Public Notices
DISTRICT
By s/ Bobby Robinson
Bobby Robinson
President,
Board of Directors
18-3t-235
NOTICE OF PUBLIC
HEARINGS
ORDINANCE NO.
2002-34
NOTICE IS HEREBY
GIVE TO ALL INTER-
EsTED PERSONS,
THAT:
The Sachse Economic
Development Corporation
proposes to initiate a 4B
Project within the City of
Sachse for the purpose of
the purchase of 6 1/2 acres
of land and improvements
located at 5001 Ben Davis
Road in Sachse, Texas for
redevelopment and subse-
quent sale or lease for
commercial uses.
Public Notices
AUTHORIZING THE
ISSUANCE OF "CITY OF
WYLIE, TEXAS, TAX
NOTES, SERIES 2002";
SPECIFYING THE
TERMS AND FEATURES
OF SAID NOTES; LEVY-
ING A CONTINUING
DIRECT ANNUAL AD
VALOREM TAX FOR
THE PAYMENT OF SAID
NOTES; AND RESOLV-
ING OTHER MATTERS
INCIDENT AND RELAT-
ED TO THE ISSUANCE,
SALE, PAYMENT AND
DELIVERY OF SAID
NOTES, INCLUDING
THE APPROVAL AND
EXECUTION OF A PAY-
ING AGENT/REGIS-
TRAR AGREEMENT
AND THE APPROVAL
AND DISTRIBUTION OF
AN OFFICIAL STATE-
MENT PERTAINING
THERETO; AND PRO-
VIDING AN EFFECTIVE
DATE.
PASSED AND
APPROVED by the City
Council of the City of
Wylie, Texas, this 24th day
of September 2002.
JOHN MONDY, MAYOR
ATTEST:
BARBARA SALINAS
CITY SECRETARY
19-1t-339
/
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