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Ord 89-85 8/27/1985 CERTIFICATE FOR ORDINANCE THE STATE OF TEXAS • COUNTY OF WICHITA • CITY OF WICHITA FALLS .• We, the undersigned officers of said City, hereby g Y� Y certify as follows: 1. The City Council of said City convened in SPECIAL MEETING ON THE 27TH DAY OF AUGUST, 1985 , at the City Hall, and the roll was called of the duly constituted officers and members of said City Council, to-wit: Gary Cook, Mayor Thomas Swift Charles Thomas Charles Harper Craig A. Wilson Bill Palmer James Welburn Wilma J. Thomas, City Clerk and all of said persons were present, except the following absentees: thus con- stituting a quorum. Whereupon, among other business, the following was transacted at said Meeting: a written ORDINANCE AUTHORIZING THE ISSUANCE OF GENERAL OBLIGATION REFUNDING AND IMPROVEMENT BONDS, SERIES 1985, AUTHORIZING THE EXECUTION OF A BOND PURCHASE CONTRACT, APPROVING AN OFFICIAL STATEMENT AND THE EXECUTION OF AN ESCROW AGREEMENT was duly introduced for the consideration of said City Council and read in full. It was then duly moved and seconded that said Ordinance be passed; and, after due discussion, said motion carrying with it the passage of said Ordinance, prevailed and carried by the following vote: AYES: All members of said City Council shown present above voted "Aye" . NOES: None. 2. That a true, full and correct copy of the aforesaid Ordinance passed at the Meeting described in the above and foregoing paragraph is attached to and follows this Certifi cate; that said Ordinance has been duly recorded in said City Council' s minutes of said Meeting; that the above and foregoing paragraph is a true, full and correct excerpt from said City Council' s minutes of said Meeting pertaining to the passage of said Ordinance; that the persons named in the above and foregoing paragraph are the duly chosen, qualified and acting officers and members of said City Council as indicated therein; that each of the officers and members of said City Council was duly and sufficiently notified offi- cially and personally, in advance, of the time, place and purpose of the aforesaid Meeting, and that said Ordinance would be introduced and considered for passage at said Meeting, and each of said officers and members consented, in advance, to the holding of said Meeting for such purpose, and that said Meeting was open to the public and public notice of the time, place and purpose of said meeting was given, all as required by Vernon' s Ann. Civ. St. Article 6252-17. 3 . That the Mayor of said City has approved and hereby approves the aforesaid Ordinance; that the Mayor and the City Clerk of said City have duly signed said Ordinance; and that the Mayor and the City Clerk of said City hereby declare that their signing of this Certificate shall constitute the signing of the attached and following copy of said Ordinance for all purposes. SIGNED AND SEALED the p .r �Qay of Auguu. City Clerk • or (SEAL) i Z ORDINANCE NO. ��O ORDINANCE AUTHORIZING THE ISSUANCE OF GENERAL OBLIGATION REFUNDING AND IMPROVEMENT BONDS , SERIES 1985, AUTHORIZING THE EXECUTION OF A BOND PURCHASE CONTRACT, APPROVING AN OFFICIAL STATEMENT AND THE EXECUTION OF AN ESCROW AGREEMENT THE STATE OF TEXAS S COUNTY OF WICHITA § CITY OF WICHITA FALLS S WHEREAS, there are presently outstanding the following bonds of the following series of bonds of the City of Wichita Falls (the "Issuer") (including three issues of bonds originally issued by water control and improvement districts and later assumed by the Issuer) which are secured by the full faith and credit of the Issuer and a pledge by the Issuer to levy ad valorem taxes sufficient to pay principal of and interest on the bonds as they become due: City of Wichita Falls General Obligation Bonds, Series 1963, dated August 1 , 1963, currently outstanding in the aggregate principal amount of $360 ,000; City of Wichita Falls General Obligation Bonds, Series 1968 , dated January 10, 1968, currently outstanding in the aggregate principal amount of $350,000; City of Wichita Falls General Obligation Bonds , Series 1968-A, dated December 1 , 1968, currently outstanding in the aggregate principal amount of $1 ,000 ,000; City of Wichita Falls General Obligation Bonds, Series 1970 , dated February 15, 1970 , currently outstanding in the aggregate principal amount of $600 ,000; City of Wichita Falls General Obligation Bonds, Series 1971, dated February 15, 1971, currently outstanding in the aggregate principal amount of $750 ,000; City of Wichita Falls General Obligation Bonds, Series 1980 , dated June 15, 1980, currently outstanding in the aggregate principal amount of $3, 100,000; City of Wichita Falls General Obligation Bonds, Series 1981 , dated October 1, 1981, currently outstanding in the aggregate principal amount of $4 ,350 ,000; City of Wichita Falls General Obligation Bonds, Series 1982 , dated August 1 , 1982, currently outstanding in the aggregate principal amount of $2, 725,000; Wichita County Water Control and Improvement District # 5, Water Revenue and Tax Bonds, Series 1956, dated November 1, 1956 , currently outstanding in the aggregate principal amount of $80,000; Wichita County Water Control and Improvement District # 6 Water and Sewer Revenue and Tax Bonds, Series 1959 , dated September 1, 1959 , currently outstanding in the aggregate principal amount of $120,000; Wichita County Water Control and Improvement District # 4 Sewer Revenue and Tax Bonds, Series 1959, dated September 1, 1959 , currently outstanding in the aggregate principal amount of $117,000; and i r WHEREAS, the Issuer now desires to refund all of said bonds currently outstanding in the aggregate principal amount of $13,552,000 (the "Refunded Bonds" or "Issuer' s Outstanding General Obligation Bonds") ; and WHEREAS, Article 717k, V.A.T.C.S. authorizes the Issuer to issue refunding bonds and to deposit the proceeds from the sale thereof together with any other available funds or resources, directly with a place of payment (paying agent) for any of the Refunded Bonds, and such deposit, if made before such payment dates, shall constitute the making of firm banking and finan- cial arrangements for the discharge and final payment of the Refunded Bonds; and WHEREAS , Article 717k, V.A.T.C.S. further authorizes the Issuer to enter into an escrow agreement with any paying agent for the Refunded Bonds with respect to the safekeeping, invest- ment, reinvestment, administration and disposition of any such deposit, upon such terms and conditions as the Issuer and such paying agent may agree, provided that such deposits may be invested and reinvested including obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, and which shall mature and bear interest payable at such times and in such amounts as will be sufficient to provide for the scheduled payment or prepayment of the Refunded Bonds; and WHEREAS, the City Council of the Issuer deems it advisable to refund the Refunded Bonds in order to lower the annual debt service requirements of the Issuer and to restructure the Issuer's cash flow and to have uniform payment dates for the principal and interest payments for the Issuer's bond debt; and WHEREAS, InterFirst Bank Wichita Falls, N.A. , Wichita Falls, Texas, (formerly City National Bank in Wichita Falls, Wichita Falls, Texas) is paying agent for the following series of the refunded Bonds : Series 1963 , Series 1968 , Series 1968-A, Series 1970, Series 1971, Series 1980, Series 1981 , and Series 1982, and the Escrow Agreement hereinafter authorized constitutes an escrow agreement of the kind authorized and permitted by said Article 717k; and WHEREAS, all the Refunded Bonds mature or are subject to redemption prior to maturity within 20 years of the date of the bonds hereinafter authorized; and WHEREAS, $9,000 ,000 of the Bonds hereinafter authorized were duly and favorable voted, as required by the Constitution and laws of the State of Texas, at an election held in said City on the 23rd day of July, 1985; and WHEREAS, it is now deemed necessary and advisable that said bonds be issued at this time, in the amounts and for the purpose as herein shown; and WHEREAS, the bonds hereinafter authorized are to be issued and delivered pursuant to Articles 717k and 823, V.A.T.C.S. , as amended and the Charter of said City; and BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF WICHITA FALLS, TEXAS: Section 1 . AMOUNT AND PURPOSE OF THE BONDS. The bonds of City of Wichita Falls (the "Issuer") are hereby authorized to be issued and delivered in the aggregate principal amount of $21, 870,000, FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND THE ISSUER'S OUTSTANDING GENERAL OBLIGATION BONDS (all as described in the preamble hereto) and for the purpose of providing 2 A $9,000 ,000 for constructing, improving and providing storm drainage facilities in said City. Section 2. DESIGNATION, DATE DENOMINATIONS, NUMBERS AND MATURITIES OF BONDS . Each bond issued pursuant to this Ordinance shall be designated: "CITY OF WICHITA FALLS, TEXAS GENERAL OBLIGATION REFUNDING AND IMPROVEMENT BOND, SERIES 1985" , and initially there shall be issued, sold and delivered hereunder fully registered bonds, without interest coupons, dated September 1, 1985 , in the respective denominations and principal amounts hereinafter stated, numbered consecutively from R-1 upward, payable to the respective initial registered owners thereof (as designated in Section 11 hereof) , or to the registered assignee or assignees of said bonds or any portion or portions thereof (in each case, the "Registered Owner") , and said bonds shall mature and be payable serially on September 1 in each of the years and in the principal amounts, respectively as set forth in the following schedule: YEARS AMOUNTS YEARS AMOUNTS 1986 $ 760 ,000 1994 $1 ,305,000 1987 805 ,000 1995 1,410,000 1988 855 ,000 1996 1 ,530 ,000 1989 915 ,000 1997 1, 665,000 1990 975 ,000 1998 1 ,810,000 1991 1,040, 000 1999 1,975,000 1992 1 , 115 ,000 2000 2,155,000 1993 1,205,000 2001 2,350,000 The term "Bonds" as used in this Ordinance shall mean and include collectively the bonds initially issued and delivered pursuant to this Ordinance and all substitute bonds exchanged therefor, as well as all other substitute bonds and replacement bonds issued pursuant hereto, and the term "Bond" shall mean any of the Bonds. Section 3 . INTEREST. The Bonds scheduled to mature during the years, respectively, set forth below shall bear interest from the dates specified in the FORM OF BOND set forth in this Ordinance to their respective dates of maturity or redemption prior to maturity at the following rates per annum: maturities 1986 5.25% maturities 1987 6 .00% maturities 1988 6.50% maturities 1989 7 .00% maturities 1990 7.25% maturities 1991 7.50% maturities 1992 7. 75% maturities 1993 8 .00% maturities 1994 8.25% maturities 1995 8 .50% maturities 1996 8.75% maturities 1997 8.90% maturities 1998 9 .00% maturities 1999 9 .10% maturities 2000 9 . 15% maturities 2001 9 .20% Said interest shall be payable in the manner provided and on the dates stated in the FORM OF BOND set forth in this Ordinance. Section 4 . CHARACTERISTICS OF THE BONDS. Registration, Transfer, and Exchange; Authentication. (a) The Issuer shall keep or cause to be kept at the principal corporate trust office of the InterFirst Bank Dallas, N.A. , Dallas, Texas (the "Paying Agent/Registrar") books or records for the registration 3 of the transfer and exchange of the Bonds (the "Registration Books") , and the Issuer hereby appoints the Paying Agent/Regis- trar as its registrar and transfer agent to keep such books or records and make such registrations of transfers and exchanges under such reasonable regulations as the Issuer and Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such registrations, transfers and exchanges as herein provided. The Paying Agent/Registrar shall obtain and record in the Registration Books the address of the registered owner of each Bond to which payments with respect to the Bonds shall be mailed, as herein provided; but it shall be the duty of each registered owner to notify the Paying Agent/Registrar in writing of the address to which payments shall be mailed, and such interest payments shall not be mailed unless such notice has been given. To the extent possible and under reasonable circumstances, all transfers of Bonds shall be made within three business days after request and presentation thereof. The Issuer shall have the right to inspect the Registration Books during regular business hours of the Paying Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books confidential and, unless otherwise required by law, shall not permit their inspection by any other entity. The Paying Agent/Registrar' s standard or customary fees and charges for making such registration, transfer, exchange and delivery of a substitute Bond or Bonds shall be paid as provided in the FORM OF BOND set forth in this Ordinance. Registration of assignments, transfers and ex- changes of Bonds shall be made in the manner provided and with the effect stated in the FORM OF BOND set forth in this Ordinance. Each substitute Bond shall bear a letter and/or number to distinguish it from each other Bond. Except as provided in (c) below, an authorized representa- tive of the Paying Agent/Registrar shall, before the delivery of any such Bond, date and manually sign the Paying Agent/Reg- istrar' s Authentication Certificate, and no such Bond shall be deemed to be issued or outstanding unless such Certificate is so executed. The Paying Agent/Registrar promptly shall cancel all paid Bonds and Bonds surrendered for transfer and exchange. No additional ordinances, orders, or resolutions need be passed or adopted by the governing body of the Issuer or any other body or person so as to accomplish the foregoing transfer and exchange of any Bond or portion thereof, and the Paying Agent/ Registrar shall provide for the printing, execution, and delivery of the substitute Bonds in the manner prescribed herein, and said Bonds shall be of type composition printed on paper with lithographed or steel engraved borders of customary weight and strength. Pursuant to Vernon' s Ann. Tex. Civ. St. Art. 717k-6 , and particularly Section 6 thereof, the duty of transfer and exchange of Bonds as aforesaid is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of said Certificate, the transferred and exchanged Bond shall be valid, incontestable, and enforceable in the same manner and with the same effect as the Bonds which initially were issued and delivered pursuant to this Ordinance, approved by the Attorney General, and registered by the Comptroller of Public Accounts. (b) Payment of Bonds and Interest. The Issuer hereby further appoints the Paying Agent/Registrar to act as the paying agent for paying the principal of and interest on the Bonds, all as provided in this Ordinance. The Paying Agent/ Registrar shall keep proper records of all payments made by the Issuer and the Paying Agent/Registrar with respect to the Bonds. (c) In General. The Bonds (i) shall be issued in fully registered form, without interest coupons, with the principal of and interest on such Bonds to be payable only to the 4 registered owners thereof, (ii) may be redeemed prior to their scheduled maturities (notice of which shall be given to the Paying Agent/Registrar by the Issuer at least 50 days prior to any such redemption date) , (iii) transferred and assigned, (iv) may be exchanged for other Bonds, (v) shall have the character- istics, (vi) shall be signed, sealed, executed and authenti- cated, (vii) the principal of and interest on the Bonds shall be payable , and (viii) shall be administered and the Paying Agent/Registrar and the Issuer shall have certain duties and responsibilities with respect to the Bonds, all as provided, and in the manner and to the effect as required or indicated, in the FORM OF BOND set forth in this Ordinance. The Bonds initially issued and delivered pursuant to this Ordinance are not required to be, and shall not be, authenticated by the Paying Agent/ Registrar, but on each substitute Bond issued in exchange for any Bond or Bonds issued under this Ordinance the Paying Agent/Registrar shall execute the PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE, in the form set forth in the FORM OF BOND. (d) Substitute Paying Agent/Registrar. The Issuer covenants with the registered owners of the Bonds that at all times while the Bonds are outstanding the Issuer will provide a competent and legally qualified bank, trust company, financial institution, or other agency to act as and perform the services of Paying Agent/Registrar for the Bonds under this Ordinance, and that the Paying Agent/Registrar will be one entity. The Issuer reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less than 120 days written notice to the Paying Agent/Registrar, to be effective not later than 60 days prior to the next principal or interest payment date after such notice. In the event that the entity at any time acting as Paying Agent/Registrar (or its successor by merger, acquisition, or other method) should resign or other- wise cease to act as such, the Issuer covenants that promptly it will appoint a competent and legally qualified bank, trust company, financial institution, or other agency to act as Paying Agent/Registrar under this Ordinance. Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Regis- trar promptly shall transfer and deliver the Registration Books (or a copy thereof) , along with all other pertinent books and records relating to the Bonds, to the new Paying Agent/Regis- trar designated and appointed by the Issuer. Upon any change in the Paying Agent/Registrar, the Issuer promptly will cause a written notice thereof to be sent by the new Paying Agent/Registrar to each registered owner of the Bonds, by United States mail, first-class postage prepaid, which notice also shall give the address of the new Paying Agent/ Registrar. By accepting the position and performing as such, each Paying Agent/Registrar shall be deemed to have agreed to the provi- sions of this Ordinance, and a certified copy of this Ordinance shall be delivered to each Paying Agent/Registrar. Section 5 . FORM OF BONDS. The form of the Bonds, includ- ing the form of Paying Agent/Registrar' s Authentication Certificate, the form of Assignment and the form of Registra- tion Certificate of the Comptroller of Public Accounts of the State of Texas to be attached to the Bonds initially issued and delivered pursuant to this Ordinance, shall be, respectively, substantially as follows, with such appropriate variations, omissions, or insertions as are permitted or required by this Ordinance. 5 FORM OF BOND NO. R- UNITED STATES OF AMERICA PRINCIPAL STATE OF TEXAS AMOUNT COUNTY OF WICHITA $ CITY OF WICHITA FALLS , TEXAS GENERAL OBLIGATION REFUNDING AND IMPROVEMENT BOND SERIES 1985 INTEREST RATE MATURITY DATE CUSIP NO. REGISTERED OWNER: PRINCIPAL AMOUNT: DOLLARS ON THE MATURITY DATE specified above, CITY OF WICHITA FALLS, in Wichita County, Texas (the "Issuer") , being a political subdivision of the State of Texas, hereby promises to pay to the Registered Owner set forth above, or registered assigns (hereinafter called the "registered owner") the principal amount set forth above, and to pay interest thereon from September 1 , 1985 , on March 1, 1986 and semiannually on each March 1 and September 1 thereafter to the maturity date specified above, or the date of redemption prior to maturity, at the interest rate per annum specified above; except that if this Bond is required to be authenticated and the date of its authentication is later than the first Record Date (hereinafter defined) , such principal amount shall bear interest from the interest payment date next preceding the date of authentication, unless such date of authentication is after any Record Date but on or before the next following interest payment date, in which case such principal amount shall bear interest from such next following interest payment date; pro- vided, however, that if on the date of authentication hereof the interest on the Bond or Bonds, if any, for which this Bond is being exchanged is due but has not been paid, then this Bond shall bear interest from the date to which such interest has been paid in full. THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the United States of America, without exchange or collection charges. The principal of this Bond shall be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity or upon the date fixed for its redemption prior to maturity, at the principal corporate trust office of InterFirst Bank Dallas, N.A. , Dallas, Texas, which is the "Paying Agent/Registrar" for this Bond. The payment of interest on this Bond shall be made by the Paying Agent/Registrar to the registered owner hereof on each interest payment date by check, dated as of such interest payment date, drawn by the Paying Agent/Registrar on, and payable solely from, funds of the Issuer required by the ordinance authorizing the issuance of this Bond (the "Bond Ordinance") to be on deposit with the Paying Agent/Registrar for such purpose as hereinafter provided; and such check shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, on each such interest payment date, to the registered owner hereof, at its address as it appeared on the fifteenth day of the month next preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described. In addition, interest may be paid by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the registered owner. Any accrued interest due at maturity or upon the redemption of this Bond prior to maturity as provided herein shall be paid to the registered owner upon presentation and 6 II surrender of this Bond for redemption and payment at the principal corporate trust office of the Paying Agent/Registrar. The Issuer covenants with the registered owner of this Bond that on or before each principal payment date, interest payment date, and accrued interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Inter- est and Sinking Fund" created by the Bond Ordinance, the amounts required to provide for the payment, in immediately available funds, of all principal of and interest on the Bonds, when due. IF THE DATE for the payment of the principal of or inter- est on this Bond shall be a Saturday, Sunday, a legal holiday, or a day on which banking institutions in the City where the principal corporate trust office of the Paying Agent/Registrar is located are authorized by law or executive order to close, or the United States Postal Service is not open for business, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are authorized to close, or the United States Postal Service is not open for business; and payment on such date shall have the same force and effect as if made on the original date payment was due. THIS BOND is one of a Series of Bonds dated September 1 , 1985, authorized in accordance with the Constitution and laws of the State of Texas in the principal amount of $21,870,000 FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND THE ISSUER'S OUT- STANDING GENERAL OBLIGATION BONDS (all as described in the preamble to the Ordinance authorizing the issuance of this Bond) and FOR THE PURPOSE OF PROVIDING $9 ,000,000 FOR CONSTRUCT- ING, IMPROVING AND PROVIDING STORM DRAINAGE FACILITIES IN SAID CITY. ON SEPTEMBER 1, 1995, or on any interest payment date thereafter, the Bonds of this Series may be redeemed prior to their scheduled maturities, at the option of the Issuer, with funds derived from any available and lawful source, as a whole, or in part, (provided that a portion of a Bond may be redeemed only in an integral multiple of $5 ,000) at the redemption price of the principal amount of Bonds called for redemption, plus accrued interest thereon to the date fixed for redemption. If less than all of the Bonds are to be redeemed, the Issuer shall determine the maturity or maturities and the amounts thereof to be redeemed and shall direct the Paying Agent/Registrar to call by lot Bonds, or portions thereof, within such maturity or maturities and in such principal amounts, for redemption. AT LEAST 30 days prior to the date fixed for any redemp- tion of Bonds or portions thereof prior to maturity, a written notice of such redemption shall be published once in a finan- cial publication, journal or reporter of general circulation among securities dealers in The City of New York, New York or in the State of Texas . Such notice also shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, at least 30 days prior to the date fixed for any such redemption, to the registered owner of each Bond to be redeemed at its address as it appeared on the day such redemption notice is mailed; provided, however, that the failure to send, mail or receive such notice, or any defect therein or in the sending or mailing thereof, shall not affect the validity or effectiveness of the proceedings for the redemption of any Bond, and it is hereby specifically provided that the publication of such notice as required above shall be the only notice actually required in connection with or as a prerequisite to the redemption of any Bonds or portions thereof. By the date fixed for any such redemption, due provision shall be made with the Paying Agent/Registrar for the payment of the required redemption price for the Bonds or 7 portions thereof which are to be so redeemed. If such written notice of redemption is published and if due provision for such payment is made, all as provided above, the Bonds or portions thereof which are to be so redeemed thereby automatically shall be treated as redeemed prior to their scheduled maturities, and they shall not bear interest after the date fixed for redemption, and they shall not be regarded as being outstanding except for the right of the registered owner to receive the redemption price from the Paying Agent/Registrar out of the funds provided for such payment. If a portion of any Bond shall be redeemed a substitute Bond or Bonds having the same maturity date, bearing interest at the same rate, in any denomination or denominations in any integral multiple of $5,000 , at the written request of the registered owner, and in an aggregate principal amount equal to the unredeemed portion thereof, will be issued to the registered owner upon the surrender thereof for cancellation, at the expense of the Issuer, all as provided in the Bond Ordinance. ALL BONDS OF THIS SERIES are issuable solely as fully registered Bonds, without interest coupons, in the denomination of any integral multiple of $5,000 . As provided in the Bond Ordinance, this Bond, or any unredeemed portion hereof, may, at the request of the registered owner or the assignee or assignees hereof, be assigned, transferred and exchanged for a like aggregate principal amount of fully registered Bonds , without interest coupons, payable to the appropriate registered owner, assignee or assignees , as the case may be, having the same denomination or denominations in any integral multiple of $5,000 as requested in writing by the appropriate registered owner, assignee or assignees, as the case may be, upon surren- der of this Bond to the Paying Agent/Registrar for cancella- tion, all in accordance with the form and procedures set forth in the Bond Ordinance. Among other requirements for such assignment and transfer, this Bond must be presented and surrendered to the Paying Agent/Registrar, together with proper instruments of assignment, in form and with guarantee of signa- tures satisfactory to the Paying Agent/Registrar, evidencing assignment of this Bond or any portion or portions hereof in any integral multiple of $5,000 to the assignee or assignees in whose name or names this Bond or any such portion or portions hereof is or are to be registered. The form of Assignment printed or endorsed on this Bond may be executed by the regis- tered owner to evidence the assignment hereof, but such method is not exclusive, and other instruments of assignment satisfac- tory to the Paying Agent/Registrar may be used to evidence the assignment of this Bond or any portion or portions hereof from time to time by the registered owner. The one requesting such transer and exchange shall pay the Paying Agent/Registrar' s reasonable standard or customary fees and charges for transferring and exchanging any Bond or portion thereof. In any circumstance, any taxes or governmental charges required to be paid with respect thereto shall be paid by the one request- ing such assignment, transfer or exchange, as a condition precedent to the exercise of such privilege. The foregoing notwithstanding, in the case of the exchange of a portion of a Bond which has been redeemed prior to maturity, as provided herein, and in the case of the exchange of an assigned and transferred Bond or Bonds or any portion or portions thereof, such fees and charges of the Paying Agent/Registrar will be paid by the Issuer. The Paying Agent/Registrar shall not be required to make any such transfer or exchange (i) during the period commencing with the close of business on any Record Date and ending with the opening of business on the next following principal or interest payment date, or, (ii) with respect to any Bond or any portion thereof called for redemption prior to maturity, within 45 days prior to its redemption date. 8 IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly will appoint a competent and legally qualified substi- tute therefor, and cause written notice thereof to be mailed to the registered owners of the Bonds. IT IS HEREBY certified, recited, and covenanted that this Bond has been duly and validly authorized, issued, and de- livered; that all acts, conditions, and things required or proper to be performed, exist, and be done precedent to or in the authorization, issuance, and delivery of this Bond have been performed, existed, and been done in accordance with law; that this Bond is a general obligation of the Issuer, issued on the full faith and credit thereof; and that ad valorem taxes sufficient to provide for the payment of the interest on and principal of this Bond, as such interest comes due, and as such principal matures, have been levied and ordered to be levied against all taxable property in the Issuer, and have been pledged for such payment, within the limit prescribed by law. BY BECOMING the registered owner of this Bond, the regis- tered owner thereby acknowledges all of the terms and provi- sions of the Bond Ordinance, agrees to be bound by such terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for inspection in the official minutes and records of the governing body of the Issuer, and agrees that the terms and provisions of this Bond and the Bond Ordinance constitute a contract between each registered owner hereof and the Issuer. IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the facsimile signature of the Mayor of the Issuer and countersigned with the facsimile signature of the City Clerk of the Issuer, and has caused the official seal of the Issuer to be duly impressed, or placed in facsimile, on this Bond. (facsimile signature) (facsimile signature) City Clerk, Mayor, (SEAL) FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE (To be executed if this Bond is not accompanied by an executed Registration Certificate of the Comptroller of Public Accounts of the State of Texas) It is hereby certified that this Bond has been issued under the provisions of the Bond Ordinance described in the text of this Bond; and that this Bond has been issued in exchange for, a bond, bonds, or a portion of a bond or bonds of a Series which originally was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas. Dated INTERFIRST BANK DALLAS, N.A. , DALLAS, TEXAS Paying Agent/Registrar By Authorized Representative 9 FORM OF ASSIGNMENT: ASSIGNMENT FOR VALUE REC I E VED the undersigned registered ned re istered owner of this bond or duly authorized representative or attorney thereof, hereby assigns this bond to / / (Assignee ' s Social (print or typewrite Assignee' s name Security or Taxpayer and address, including zip code) Identification Number) and hereby irrevocably constitutes and appoints attorney to transfer the registration of this bond on the Bond Registration Books with full power of substitution in the premises. Dated: Signature Guaranteed: NOTICE : The signature of the Registered Owner Registered Owner must be gua- NOTICE: This signature ranteed by a member of the must correspond with the New York Stock Exchange or a name of the Registered commercial bank or trust Owner appearing on the face company. of this bond. FORM OF REGISTRATION CERTIFICATE OF THE COMPTROLLER OF PUBLIC ACCOUNTS: COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO. I hereby certify that this Bond has been examined, cer- tified as to validity, and approved by the Attorney General of the State of Texas, and that this Bond has been registered by the Comptroller of Public Accounts of the State of Texas. Witness my signature and seal this Comptroller of Public Accounts of the State of Texas (COMPTROLLER'S SEAL) Section 6 . TAX LEVY. A special Interest and Sinking Fund (the "Interest and Sinking Fund") is hereby created solely for the benefit of the Bonds, and the Interest and Sinking Fund shall be established and maintained by the Issuer at an offi- cial depository bank of the Issuer. The Interest and Sinking Fund shall be kept separate and apart from all other funds and accounts of the Issuer, and shall be used only for paying the interest on and principal of the Bonds. All ad valorem taxes levied and collected for and on account of the Bonds shall be deposited, as collected, to the credit of the Interest and Sinking Fund. During each year while any of the Bonds or interest thereon are outstanding and unpaid, the City Council of the Issuer shall compute and ascertain a rate and amount of ad valorem tax which will be sufficient to raise and produce the money required to pay the interest on the Bonds as such 10 a interest comes due , and to provide and maintain a sinking fund adequate to pay the principal of its Bonds as such principal matures (but never less than 2% of the original principal amount of said Bonds as a sinking fund each year) ; and said tax shall be based on the latest approved tax rolls of the Issuer, with full allowance being made for tax delinquencies and the cost of tax collection. Said rate and amount of ad valorem tax is hereby levied, and is hereby ordered to be levied, against all taxable property in the Issuer for each year while any of the Bonds or interest thereon are outstanding and unpaid; and said tax shall be assessed and collected each such year and de- posited to the credit of the aforesaid Interest and Sinking Fund. Said ad valorem taxes sufficient to provide for the payment of the interest on and principal of the Bonds, as such interest comes due and such principal matures , are hereby pledged for such payment, within the limit prescribed by law. Section 7 . DEFEASANCE OF BONDS. (a) Any Bond and the interest thereon shall be deemed to be paid, retired, and no longer outstanding (a "Defeased Bond") within the meaning of this Ordinance, except to the extent provided in subsection (d) of this Section 7, when payment of the principal of such Bond, plus interest thereon to the due date (whether such due date be by reason of maturity, upon redemption, or otherwise) either (i) shall have been made or caused to be made in accordance with the terms thereof (including the giving of any required notice of redemption) , or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Paying Agent/Registrar for such payment (1) lawful money of the United States of America sufficient to make such payment or (2) Government Obligations which mature as to principal and interest in such amounts and at such times as will insure the availability, without reinvestment, of suffi- cient money to provide for such payment, and when proper arrangements have been made by the Issuer with the Paying Agent/Registrar for the payment of its services until all Defeased Bonds shall have become due and payable. At such time as a Bond shall be deemed to be a Defeased Bond hereunder, as aforesaid, such Bond and the interest thereon shall no longer be secured by, payable from, or entitled to the benefits of, the ad valorem taxes herein levied and pledged as provided in this Ordinance, and such principal and interest shall be payable solely from such money or Government Obligations. (b) Any moneys so deposited with the Paying Agent/Regis- trar may at the written direction of the Issuer also be in- vested in Government Obligations, maturing in the amounts and times as hereinbefore set forth, and all income from such Government Obligations received by the Paying Agent/Registrar which is not required for the payment of the Bonds and interest thereon, with respect to which such money has been so depos- ited, shall be turned over to the Issuer, or deposited as directed in writing by the Issuer. (c) The term "Government Obligations" as used in this Section, shall mean direct obligations of the United States of America, including obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, which may be United States Treasury obligations such as its State and Local Government Series, which may be in book-entry form. (d) Until all Defeased Bonds shall have become due and payable, the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for such Defeased Bonds the same as if they had not been defeased, and the Issuer shall make proper arrangements to provide and pay for such services as required by this Ordinance. 11 Section 8 . DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS. (a) Replacement Bonds. In the event any outstanding Bond is damaged, mutilated, lost, stolen, or destroyed, the Paying Agent/Registrar shall cause to be printed, executed, and delivered, a new bond of the same principal amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or destroyed Bond, in replacement for such Bond in the manner hereinafter provided. (b) Application for Replacement Bonds. Application for replacement of damaged, mutilated, lost, stolen, or destroyed Bonds shall be made by the registered owner thereof to the Paying Agent/Registrar. In every case of loss, theft, or destruction of a Bond, the registered owner applying for a replacement bond shall furnish to the Issuer and to the Paying Agent/Registrar such security or indemnity as may be required by them to save each of them harmless from any loss or damage with respect thereto. Also, in every case of loss, theft, or destruction of a Bond, the registered owner shall furnish to the Issuer and to the Paying Agent/Registrar evidence to their satisfaction of the loss, theft, or destruction of such Bond, as the case may be. In every case of damage or mutilation of a Bond, the registered owner shall surrender to the Paying Agent/Registrar for cancellation the Bond so damaged or muti- lated. (c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the event any such Bond shall have matured, and no default has occurred which is then con- tinuing in the payment of the principal of, redemption premium, if any, or interest on the Bond, the Issuer may authorize the payment of the same (without surrender thereof except in the case of a damaged or mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished as above provided in this Section. (d) Charge for Issuing Replacement Bonds. Prior to the issuance of any replacement bond, the Paying Agent/Registrar shall charge the registered owner of such Bond with all legal, printing, and other expenses in connection therewith. Every replacement bond issued pursuant to the provisions of this Section by virtue of the fact that any Bond is lost, stolen, or destroyed shall constitute a contractual obligation of the Issuer whether or not the lost, stolen, or destroyed Bond shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Ordinance equally and proportionately with any and all other Bonds duly issued under this Ordinance. (e) Authority for Issuing Replacement Bonds. In accor- dance with Section 6 of Vernon' s Ann. Tex. Civ. St. Art. 717k-6, this Section 8 of this Ordinance shall constitute authority for the issuance of any such replacement bond without necessity of further action by the governing body of the Issuer or any other body or person, and the duty of the replacement of such bonds is hereby authorized and imposed upon the Paying Agent/ Registrar, and the Paying Agent/Registrar shall authen- ticate and deliver such Bonds in the form and manner and with the effect, as provided in Section 4 (a) of this Ordinance for Bonds issued in exchange for other Bonds . Section 9 . CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND COUNSEL'S OPINION, AND CUSIP NUMBERS. The Mayor of the Issuer is hereby authorized to have control of the Bonds initially issued and delivered hereunder and all necessary records and proceedings pertaining to the Bonds pending their delivery and their investigation, examination, and approval by the Attorney General of the State of Texas, and their registra- tion by the Comptroller of Public Accounts of the State of 12 • Texas. Upon registration of the Bonds said Comptroller of Public Accounts (or a deputy designated in writing to act for said Comptroller) shall manually sign the Comptroller' s Registration Certificate attached to such Bonds , and the seal of said Comptroller shall be impressed, or placed in facsimile, on such Certificate. The approving legal opinion of the Issuer' s Bond Counsel and the assigned Ct1SIP numbers may, at the option of the Issuer, be printed on the Bonds issued and delivered under this Ordinance, but neither shall have any legal effect, and shall be solely for the convenience and information of the registered owners of the Bonds . Section 10 . NO ARBITRAGE. The Issuer covenants to and with the registered owners of the Bonds that it will make no use of the proceeds of the Bonds at any time throughout the term of this issue of Bonds which, if such use had been reason- ably expected on the date of delivery of the Bonds to and payment for the Bonds by the purchasers, would have caused the Bonds to be arbitrage bonds within the meaning of Section 103 (c) of the Internal Revenue Code of 1954, as amended, or any regulations or rulings pertaining thereto; and by this covenant the Issuer is obligated to comply with the requirements of the aforesaid Section 103 (c) and all applicable and pertinent Department of the Treasury regulations relating to arbitrage bonds . The Issuer further covenants that the proceeds of the Bonds will not otherwise be used directly or indirectly so as to cause all or any part of the Bonds to be or become arbitrage bonds within the meaning of the aforesaid Section 103 (c) , or any regulations or rulings pertaining thereto. Section 11 . SALE OF BONDS . The Bonds are hereby sold and shall be delivered to Schneider, Bernet & Hickman (the "Under- writers") at a price of $21,323, 250 and accrued interest thereon to date of delivery, pursuant to the terms and provi- sions of a Purchase Contract in substantially the form attached hereto as Exhibit A which the Mayor of the Issuer is hereby authorized and directed to execute and deliver and which the City Clerk of the Issuer is hereby authorized and directed to attest. It is hereby officially found, determined, and de- clared that the terms of this sale are the most advantageous reasonably obtainable. The Bonds shall initially be registered in the name of Schneider, Bernet & Hickman. The Officers of the Issuer are hereby authorized and directed to execute and deliver such Certificates, instructions, or other instruments as are required or necessary to accomplish the purposes of this Ordinance, the Purchase Contract, the Official Statement, or the Escrow Agreement. Section 1 2. APPROVAL OF OFFICIAL STATEMENT. The Issuer hereby approves the form and content of the Official Statement dated August 27, 1985 , relating to the Bonds, and any addenda, supplement or amendment thereto and approves the distribution of such Official Statement in the reoffering of the Bonds by the Underwriters in final form, with such changes therein or additions thereto as the officer executing the same may deem advisable, such determination to be conclusively evidenced by his execution thereof. It is further officially found determined and declared that the statements and representations contained in said Official Statement are true and correct in all material respects to the best knowledge and belief of the City Council. Section 13 . APPROVAL OF SPECIAL ESCROW AGREEMENT AND TRANSFER OF FUNDS . The Mayor of the Issuer is hereby author- ized and directed to execute and deliver and the City Clerk is hereby authorized and directed to attest a Special Escrow Agreement in substantially the form attached hereto as Exhibit B. In addition, the Mayor is authorized to execute such subscriptions for the purchase of United States Treasury 13 • . • a • Securities, State and Local Government Series, as may be necessary for the Escrow Fund, and that the Issuer may also purchase from Schneider, Bernet & Hickman for investment in the Escrow Fund such obligations of the United States of America or any of its agencies, or such obligations fully guaranteed by the United States of America that will be appropriate open market investments for such Escrow Fund. In addition, offi- cials of the Issuer are directed, upon delivery of the Bonds, to transfer to InterFirst Bank Wichita Falls, N.A. , Wichita Falls, Texas, as Escrow Agent under the Special Escrow Agree- ment from the funds on hand an amount necessary to purchase such open market investments, which amount shall be deposited in the Escrow Fund and used in accordance with the provisions of the Special Escrow Agreement. Section 14. NOTICE OF REDEMPTION. There is attached to this Ordinance as Exhibit C and made a part hereof for all purposes, a Notice of Prior Redemption of Bonds for the Series 1981 Bonds and the Series 1982 Bonds to be redeemed prior to stated maturity and such Series 1981 Bonds and Series 1982 Bonds described in said Notice of Prior Redemption are hereby called for redemption and shall be redeemed prior to maturity on the dates, places and at the prices as set forth in Exhibit C. Pursuant to the Ordinances authorizing the Series 1981 Bonds, and the Series 1982 Bonds, respectively, the City Clerk of the Issuer shall cause said Notice of Prior Redemption to be published prior to the delivery of the Bonds in a financial publication published in the City of New York, New York. In addition, at least 30 days but not more than 90 days prior to said redemption date said notice shall again be published by InterFirst Bank Dallas, N.A. , Dallas, Texas in the same manner. Section 15. CONSIDERATIONS OF REFUNDING. The City Council hereby finds that by refunding the Refunded Bonds the City will (i) lower the Annual Debt Service requirements with respect to that obligation, (ii) restructure its Debt Service in a manner which allows the issuance of the new money portion of this issue without a tax rate increase, (iii) restructure its cash flow to improve utilization of the City's cash resources and (iv) consolidate its Paying Agent Services into one bank. Section 16 . EMERGENCY. That it is hereby officially found and determined: that a case of emergency or urgent public necessity exists which requires the holding of the meeting at which this Ordinance is passed, such emergency or urgent public necessity being that it is necessary that the bonds be refunded and that the proceeds from the sale of said bonds are required as soon as possible and without delay for necessary and urgently needed public improvements; and that said meeting was open to the public, and public notice of the time, place, and purpose of said meeting was given, all as required by Vernon's Ann. Civ. St. Article 6252-17. Section 17 . IMMEDIATE EFFECT. This Ordinance shall take effect and be in force immediately upon and after its passage in accordance with the provisions of the Charter of the City, and it is accordingly so ordained. 14 PURCHASE CONTRACT RELATING TO $21,870,000 CITY OF WICHITA FALLS, TEXAS GENERAL OBLIGATION REFUNDING AND IMPROVEMENT BONDS SERIES 1985 August 27, 1985 The Honorable Mayor and City Council City of Wichita Falls Wichita Falls, Texas Dear Mayor and Members of the Council: The undersigned (the "Underwriter") hereby offers to enter into this Purchase Contract with the City of Wichita Falls, Texas (the "City"). This offer is made subject to the City's acceptance of this Purchase Contract on or before 5:00 p.m., Central Daylight Time, on August 27, 1985, and if not so accepted, will be subject to withdrawal by the Underwriter upon notice delivered to the City at any time prior to the acceptance hereof by the City. 1. Upon the terms and conditions and upon the basis of the representations set forth herein, the Underwriter hereby agrees to purchase from the City, and the City hereby agrees to sell and deliver to the Underwriter an aggregate of $21,870,000 principal amount of City of Wichita Falls, Texas, General Obligation Refunding and Improvement Bonds, Series 1985 (the "Bonds"). The Bonds shall be dated September 1, 1985, and shall have the maturities and bear interest from their date or have a yield to maturity at the rate or rates per annum set forth in the City's ordinance authorizing the issuance and sale of the Bonds (the "Ordinance"). The interest on the Bonds shall be payable on September 1, 1986, and semiannually thereafter on September 1 and March 1 in each year until maturity or prior redemption. The purchase price for the Bonds shall be $21,323,250, plus interest accrued on the Bonds from their date to the date of the payment for and delivery of the Bonds (such payment and delivery being herein sometimes called the "Closing"). Exhibit A hereto is the Official Statement, including the cover page and Appendices thereto, of the City, dated August 27, 1985, with respect to the Bonds. The Official Statement, including the cover page and Appendices thereto, as further amended only in the manner hereinafter provided, is hereinafter called the "Official Statement." 2. The Bonds shall be described in and shall be issued and secured under the provisions of the Ordinance adopted by the City on August 27, 1985. The Bonds shall be subject to redemption and shall be payable as provided in the Ordinance. 3. It shall be a condition of the obligation of the City to sell and deliver the Bonds to the Underwriter, and of the obligation of the Underwriter to purchase and accept delivery of the Bonds, that the entire $21,870,000 principal amount of the Bonds authorized by the Ordinance shall be sold and delivered by the City and accepted and paid for by the Underwriter at the Closing. The Underwriter agrees to • • make a bona fide public offering of all of the Bonds, at not in excess of the initial public offering prices, as set forth on the cover page of the Official Statement, plus interest accrued thereon, if any, from the date of the Bonds. 4. The City hereby authorizes the use by the Underwriter of the Ordinance, the Official Statement and the information therein contained and the audited financial statements for the fiscal year of the City ending September 30, 1984, along with the Report of Independent Certified Public Accountants for the fiscal year ending September 30, 1984 (the "Financial Statements") which are attached to the Official Statement as Appendix A in connection with the public offering and sale of the Bonds. The City confirms its consent to the use by the Underwriter prior to the date hereof of the Preliminary Official Statement, dated August 20, 1985 (the "Preliminary Official Statement"), and the Financial Statements in connection with the public offering of the Bonds. 5. On the date hereof, the City represents, warrants and agrees as follows: (a) The City is a municipal corporation, a political subdivision of the State of Texas and a body politic and corporate, and has full legal right, power and authority to enter into this Purchase Contract, to adopt the Ordinance, to sell the Bonds, and to issue and deliver the Bonds to the Underwriter as provided herein and to carry out and consummate all other transactions contemplated by the Ordinance and this Purchase Contract; (b) By official action of the City prior to or concurrently with the acceptance hereof, the City has duly adopted the Ordinance, has duly authorized and approved the execution and delivery and the performance by the City, of the obligations contained in the Bonds and this Purchase Contract; (c) The City is not in breach of or default under any applicable law or administrative regulation of the State of Texas or the United States or any applicable judgment or decree or any loan agreement, note, resolution, agreement or other instrument, except as may be disclosed in the Official Statement, to which the City is a party or is otherwise subject, which would have a material and adverse effect upon the business or financial condition of the City; and the execution and delivery of this Purchase Contract by the City and the execution and delivery of the Bonds and the adoption of the Ordinance by the City and compliance with the provisions of each thereof will not violate or constitute a breach of or default under any existing law, administrative regulation, judgment, decree or any agreement or other instrument to which the City is a party or is otherwise subject; (d) All approvals, consents and orders of any governmental authority or agency having jurisdiction of any matter which would constitute a condition precedent to the performance by the City of its obligations to sell and deliver the Bonds hereunder will have been obtained prior to the Closing; (e) At the time of the City's acceptance hereof, the Official Statement does not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make 0301p -2- 1 II the statements therein, in the light of the circumstances under which they were made, not misleading; (f) Between the date of this Purchase Contract and the Closing, the City will not, without the prior written consent of the Underwriter, issue any additional bonds, notes or other obligations for borrowed money, and the City will not incur any material liabilities, direct or contingent relating to, nor will there be any adverse change of a material nature in the financial position of the City; (g) Except as described in the Official Statement, no litigation is pending or, to the knowledge of the City, threatened in any court affecting the corporate existence of the City, the title of its officers to their respective offices, or seeking to restrain or enjoin the issuance or delivery of the Bonds, or the collection of the revenues of the City pledged or to be pledged to pay the principal of and interest on the Bonds, or in any way contesting or affecting the validity or enforceability of the Bonds, the Ordinance, or this Purchase Contract, or contesting the powers of the City, or any authority for the Bonds, the Ordinance, or this Purchase Contract or contesting in any way the completeness, accuracy or fairness of the Preliminary Official Statement or the Official Statement; (h) The City will cooperate with the Underwriter in its efforts to arrange for the qualification of the Bonds for sale and to determine their eligibility for investment under the laws of such jurisdictions as the Underwriter designates, and will use its best efforts to continue such qualifications in effect so long as may be required for the initial distribution of the Bonds; provided, however, that the City will not be required to execute a special or general consent to service of process or qualify to do business in connection with any such qualification in any jurisdiction; (i) The descriptions contained in the Official Statement of the plan of financing to be implemented by the issuance of the Bonds, the Bonds and the Ordinance accurately reflect the provisions of such plan and instruments, and the Bonds, when validly executed, authenticated, certified and delivered in accordance with the Ordinance and sold to the Underwriter as provided herein, will be validly issued and outstanding direct obligations of the City payable from ad valorem taxes which are entitled to the benefits of the Ordinance; and (j) The Financial Statements are precise copies of the audited financial statements of the City for the fiscal year ending September 30, 1984, which along with the Report of Independent Certified Public Accountants, were submitted to the City; and to the best knowledge of the City constitute full, complete and latest audited financial information relating to the City and there is no basis for a belief that the information contained therein is inaccurate or misleading in any material respect. (k) If prior to the Closing an event occurs affecting the City which is materially adverse for the purpose for which the Official Statement is to be used and is not disclosed in the Official Statement, the City shall notify the Underwriter, and if in the opinion of the City and the Underwriter such event requires a supplement or amendment to the Official Statement, 0301p -3- the City will supplement or amend the Official Statement in a form and in a manner approved by the Underwriter and Bond Counsel to the City. 6. At 10:00 a.m., Central Daylight Time, on September 26, 1985 (the "Closing"), the City will deliver the Bonds to the Underwriter in definitive form, duly executed, authenticated and certified, together with the other documents hereinafter mentioned, and the Underwriter will accept such delivery and pay the purchase price of the Bonds as set forth in Paragraph 1 hereof by check payable in federal funds to the order of the City. The Underwriter shall advise the Paying Agent/Registrar (as defined in the Ordinance) of the names of the persons to whom the Bonds will be registered no less than (five) 5 business days prior to the Closing. Delivery and payment as aforesaid shall be made at the offices of McCall, Parkhurst & Horton, or such other place, as shall have been mutually agreed upon by the City and the Underwriter. The Bonds shall be printed or lithographed on steel engraved borders; shall be prepared and delivered as fully registered bonds in the denomination of $5,000 or any integral multiple thereof, and shall be made available to the Underwriter at least one business day before the Closing for the purpose of inspection. 7. The Underwriter has entered into this Purchase Contract in reliance upon the representations and warranties of the City contained herein and to be contained in the documents and instruments to be delivered at the Closing, and upon the performance of the City of its obligations hereunder, both as of the date hereof and as of the date of Closing. Accordingly, the Underwriter's obligations under this Purchase Contract to purchase and pay for the Bonds shall be subject to the performance by the City of its obligations to be performed hereunder and under such documents and instruments at or prior to the Closing, and shall also be subject to the following conditions: (a) The representations and warranties of the City contained herein shall be true, complete and correct in all material respects at the date hereof and on and as of the date of Closing, as if made on the date of Closing; (b) At the time of the Closing, the Ordinance shall be in full force and effect, and the Ordinance shall not have been amended, modified, or supplemented and the Official Statement shall not have been amended, modified or supplemented, except as may have been agreed to by the Underwriter; (c) At the time of the Closing, all official action of the City related to the Ordinance shall be in full force and effect and shall not have been amended, modified or supplemented; (d) The City shall not have failed to pay principal or interest when due on any of its outstanding obligations for borrowed money; (e) At or prior to the Closing, the Underwriter shall have received each of the following documents: (1) Two copies of the Official Statement executed on behalf of the City by the Mayor of the City; 0301p -4- • (2) The Ordinance certified by the City Secretary under its seal as having been duly adopted by the City and as being in effect, with such changes or amendments as may have been agreed to by the Underwriter; (3) An unqualified bond opinion, dated the date of Closing, of McCall, Parkhurst & Horton, Bond Counsel to the City; (4) The supplemental opinion, dated the date of Closing of McCall, Parkhurst & Horton, addressed to the Underwriter, substantially to the effect that (i) the Bonds are exempted securities within the meaning of Section 3(a)(2) of the Securities Act of 1933, as amended; and (ii) in connection with the sale of the Bonds, it is not necessary to register the Bonds under the Securities Act of 1933, as amended, or to registrar the Ordinance under the Trust Indenture Act of 1939, as amended; and that the information contained in the Official Statement under the captions "Plan of Financing," "The Series 1985 Bonds" and "Tax Exemption" attached thereto are fair, accurate and complete; (5) An unqualified opinion or certificate, dated on or prior to the date of Closing, of the Attorney General of Texas, approving the initial bond or bonds delivered to the Underwriter; (6) The opinion, dated the date of Closing of Hutchison Price Boyle & Brooks, Counsel to the Underwriter, in form and substance satisfactory to the Underwriter; (7) A certificate, dated the date of Closing, signed by the City Manager or an Assistant City Manager of the City, to the effect that (i) the representations and warranties of the City contained herein are true and correct in all material respects on and as of the date of Closing as if made on the date of Closing; (ii) except to the extent disclosed in the Official Statement, no litigation is pending or, to the knowledge of such person, threatened in any court to restrain or enjoin the issuance or delivery of the Bonds, or the collection of revenues and assets of the City pledged or to be pledged to pay the principal of and interest on the Bonds, or the pledge thereof, or in any way contesting or affecting the validity of the Bonds, the Ordinance or this Purchase Contract, or contesting the powers of the City or contesting the authorization of the Bonds or the Ordinance, or contesting in any way the accuracy, completeness or fairness of the Preliminary Official Statement or the Official Statement (but in lieu of or in conjunction with such certificate the Underwriter may, in their sole discretion, accept certificates or opinions of the City Attorney, that, in his opinion, the issues raised in any such pending or threatened litigation are without substance or that the contentions of all plaintiffs therein are without merit); and (iii) to the best of his knowledge, no event affecting the City has occurred since the date of the Official Statement which should be disclosed in the Official Statement for the purpose for which it is to be used or which it is necessary to disclose therein in order to make the statements and information therein not misleading in any respect; 0301p -5- • (8) A certificate, dated the date of Closing, of the City Y Manager or an Assistant City Manager of the City that there has not been any material adverse change in the financial condition of the City, since September 30, 1984, the latest date as of which audited financial information is available; (9) A certificate or certificates of the City with respect to arbitrage; (10) The report of Alexander Grant & Company, independent Certified Public Accountants, relating to the arithmetical and mathematical computations made relating to the adequacy of the maturing principal and interest on federal securities and reinvested cash held to pay the debt service on the bonds being refunded by the Bonds and supporting the conclusion that the Bonds are not "arbitrage bonds" within the meaning of Section 103(c) of the Internal Revenue Code of 1954, as amended; (11) Evidence satisfactory to the Underwriter that the Bonds have been rated "Al/AA" or better by Moody's Investor Service and Standard & Poor's Corporation, respectively; (12) Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request, including the opinion of the City Attorney, to evidence the truth, accuracy and completeness, as of the date hereof and as of the date of Closing, of the City's representations and warranties contained herein and of the statements and information contained in the Official Statement and the due performance and satisfaction by the City at or prior to the date of Closing of all agreements then to be performed and all conditions then to be satisfied by the City; and (13) A copy of all proceedings of the City relating to the authorization of this Purchase Contract and to the authorization and issuance of the Bonds, certified as true, accurate and complete by the City Secretary of the City. All the opinions, letters, certificates, instruments and other documents mentioned above or elsewhere in this Purchase Contract shall be deemed to be in compliance with the provisions hereof if, but only if, they are satisfactory to the Underwriter. If the City shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds contained in this Purchase Contract, or if the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds shall be terminated for any reason permitted by this Purchase Contract, this Purchase Contract shall terminate and neither the Underwriter nor the City shall be under further obligation hereunder, except that the respective obligations of the City and the Underwriter set forth in Paragraphs 10 and 11 hereof shall continue in full force and effect. 0301p -6- 10. The Underwriter may terminate its obligation to purchase at any time before the Closing if any of the following should occur: (a) (i) Legislation shall have been enacted by the Congress of the United States, or recommended to the Congress for passage by the President of the United States or favorably reported for passage to either House of the Congress by any Committee of such House; or (ii) a decision shall have been rendered by a court established under Article III of the Constitution of the United States or by the United States Tax Court; or (iii) an order, ruling or regulation shall have been issued or proposed by or on behalf of the Treasury Department of the United States or the Internal Revenue Service or any other agency of the United States; or (iv) a release or official statement shall have been issued by the President of the United States or by the Treasury Department of the United States or by the Internal Revenue Service, the effect of which, in any such case described in clause (i), (ii), (iii), or (iv), would be to impose, directly or indirectly, Federal income taxation upon interest received on obligations of the general character of the Bonds or upon income of the general character to be derived by the City in such a manner as in the judgment of the Underwriter would materially impair the marketability or materially reduce the market price of obligations of the general character of the Bonds. (b) Legislation shall have been enacted by the Congress of the United States to become effective on or prior to the Closing, or a decision of a court ruling, regulation or proposed regulation by or on behalf of the Securities and Exchange Commission or other agency having jurisdiction over the subject matters shall be issued or made, to the effect that the issuance, sale and delivery of the Bonds, or any other obligations of any similar public body of the general character of the City, is in violation of the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, or the execution and delivery of the Ordinance or any indenture of similar character is in violation of the Trust Indenture Act of 1939, as amended, or with the purpose or effect of otherwise prohibiting the issuance, sale or delivery of the Bonds as contemplated hereby or by the Official Statement or of obligations of the general character of the Bonds. (c) (i) The Constitution of the State of Texas shall be amended or an amendment shall be proposed; or (ii) legislation shall be enacted; or (iii) a decision shall have been rendered as to matters of Texas law; or (iv) any order, ruling or regulation shall have been rendered as to or on behalf of the State of Texas by an official, agency or department thereof, affecting the tax status of the City, its property or income, its bonds (including the Bonds) or the interest thereon, which in the judgment of the Underwriter would materially affect the market price of the Bonds. (d) (i) A general suspension of trading in securities shall have occurred on the New York Stock Exchange or (ii) the United States shall have become engaged in hostilities which have resulted in the declaration, on or after the date of this Purchase Contract, of a national emergency or war, the effect of which, in either case described in clause (i) and (ii), is, in the judgment of the Underwriter, so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the 0301p -7- delivery of the Bonds on the terms and in the manner contemplated in this Purchase Contract and the Official Statement. (e) An event described in Paragraph 5(k) hereof occurs which, in the opinion of the Underwriter, requires a supplement or amendment to the Official Statement. (f) A general banking moratorium shall have been declared by authorities of the United States or the State of New York or the State of Texas. 11. Costs related to the issuance and sale of the Bonds shall be paid as follows: (a) The following items will be paid from the proceeds of the Bonds as costs of issuance: (i) the cost of the preparation and printing of the Ordinance, the Preliminary Official Statement and the Official Statement; (ii) the cost of the preparation and printing of the Bonds; (iii) the fees and disbursements of the City's Bond Counsel, Financial Advisor and other professionals employed by the City in connection with the issuance of the Bonds; and (iv) fees and expenses incurred in obtaining bond ratings. (b) The Underwriter shall pay: (i) all advertising expenses in connection with the offering of the Bonds; (ii) the cost of any federal funds; (iii) the fees and disbursements of Underwriter's Counsel; (iv) travel expenses of Underwriter and Underwriter's Counsel; and (v) all other expenses incurred by them or any of them in connection with their offering and distribution of the Bonds. 12. Any notice or other communication to be given to the City under this Purchase Contract may be given by delivering the same in writing at the address for the City set forth above, and any notice or other communication to be given to the Underwriter under this Purchase Contract may be given by delivering the same in writing to Schneider, Bernet & Hickman, 2400 InterFirst Two, Dallas, Texas 75270, Attention: J. D. Buchanan. 13. This Purchase Contract is made solely for the benefit of the City and the Underwriter (including the successors or assigns of the Underwriter) and no other person shall acquire or have any right hereunder or by virtue hereof. The City's representations, warranties and agreements contained in this Purchase Contract shall remain operative and in full force and effect, regardless of (i) any investigations made by or on behalf of any of the Underwriters and (ii) delivery of any payment for the Bonds hereunder; and the City's representations and warranties contained in Paragraph 7 of this Purchase Contract shall remain operative and in full force and effect, regardless of any termination of this Purchase Contract. 14. This Purchase Contract shall become effective upon the execution of the acceptance hereof by the Mayor of the City and shall be valid and enforceable as of the time of such acceptance. Very truly yours, SCHNEIDER, $ERNET & HICKMAN ^ 0111111 0301p -8- • • ACCEPTED: Thi 9alday of 7 7 , 1985. CITY OF WICHITA FALLS, TEXAS ' - "- - - it o ichita'Falls, Texas Attest: Jk-_,1444A0j 1 " C71 'Ill-A'd City Sty, ity of Wichita Falls, Texas CZ zir [SEAL] APPROVED AS TO FORM AND LEGALITY: ity Attorney, ►' of W chita Falls, 'exas 0301p -9- r Exhibit A OFFICIAL STATEMENT 0301p -xfr«/r 3 ESCROW AGREEMENT THIS ESCROW AGREEMENT, dated as of September 1, 1985 (herein, together with any amendments or supplements hereto, called the "Agreement" ) is entered into by and between the City of Wichita Falls, Texas (herein called the "Issuer" ) and InterFirst Bank Wichita Falls, N.A. , Wichita Falls, Texas, as escrow agent (herein, together with any successor in such capacity, called the "Escrow Agent" ) . The addresses of the Issuer and the Escrow Agent are shown on Exhibit "A" attached hereto and made a part hereof. W I T N E S S E T H: WHEREAS, the Issuer heretofore has issued and there presently remain outstanding the obligations described in Exhibit "B" attached hereto (the "Refunded Obligations" ) ; and WHEREAS, the Refunded Obligations are scheduled to come due in such years, bear interest at such rates, and be payable at such times and in such amounts as are set forth in Exhibit "C" attached hereto and made a part hereof; and WHEREAS, when firm banking arrangements have been made for the payment of all principal and interest of the Refunded Obligations when due, then the Refunded Obligations shall no longer be regarded as outstanding except for the purpose of receiving payment from the funds provided for such purpose; and WHEREAS, Vernon' s Ann. Tex. Civ. St. Article 717k, as amended, authorizes the Issuer to issue refunding bonds and to deposit the proceeds from the sale thereof, and any other available funds or resources, directly with any place of payment (paying agent) for any of the Refunded Obligations, and such deposit, if made before such payment dates and in suffi- cient amounts, shall constitute the making of firm banking and financial arrangements for the discharge and final payment of the Refunded Obligations; and WHEREAS, Article 717k further authorizes the Issuer to enter into an escrow agreement with any such paying agent for any of the Refunded Obligations with respect to the safe- keeping, investment, administration and disposition of any such deposit, upon such terms and conditions as the Issuer and such paying agent may agree, provided that such deposits may be invested only in direct obligations of the United States of America, including obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, and which may be in book entry form, and which shall mature and/or bear interest payable at such times and in such amounts as will be sufficient to provide for the scheduled payment of principal and interest on the Refunded Obligations when due; and WHEREAS, the Escrow Agent is a paying agent (the "Paying Agent" ) for the Refunded Obligations and this Agreement consti- tutes an escrow agreement of the kind authorized and required by said Article 717k; and WHEREAS, Article 717k makes it the duty of the Escrow Agent to comply with the terms of this Agreement and timely make available to the other places of payment (paying agents) for the Refunded Obligations the amounts required to provide for the payment of the principal of and interest on such obligations when due, and in accordance with their terms, but solely from the funds, in the manner, and to the extent pro- vided in this Agreement; and WHEREAS, the issuance, sale, and delivery of City of Wichita Falls, Texas General Obligation Refunding and Improvement Bonds, Series 1985 (the "Refunding Obligations" ) have been duly authorized to be issued, sold, and delivered for the purpose of obtaining the funds required to provide for the payment of the principal of and interest on the Refunded Obligations when due; and WHEREAS, the Issuer desires that, concurrently with the delivery of the Refunding Obligations to the purchasers there- of, certain proceeds of the Refunding Obligations, together with certain other available funds of the Issuer, shall be applied to purchase certain direct obligations of the United States of America hereinafter defined as the "Escrowed Securi- ties" for deposit to the credit of the Escrow Fund created pursuant to the terms of this Agreement and to establish a beginning cash balance (if needed) in such Escrow Fund; and WHEREAS, the Escrowed Securities shall mature and the interest thereon shall be payable at such times and in such amounts so as to provide moneys which, together with cash balances from time to time on deposit in the Escrow Fund, will be sufficient to pay interest on the Refunded Obligations as it accrues and becomes payable and the principal of the Refunded Obligations as it becomes due and payable; and WHEREAS, to facilitate the receipt and transfer of pro- ceeds of the Escrowed Securities, particularly those in book entry form, the Issuer desires to establish the Escrow Fund at the principal corporate trust office of the Escrow Agent; and WHEREAS, the Escrow Agent is a party to this Agreement to acknowledge its acceptance of the terms and provisions hereof; NOW, THEREFORE, in consideration of the mutual undertak- ings, promises and agreements herein contained, the sufficiency of which hereby are acknowledged, and to secure the full and timely payment of principal of and the interest on the Refunded Obligations, the Issuer and the Escrow Agent mutually under- take, promise, and agree for themselves and their respective representatives and successors, as follows: ARTICLE I DEFINITIONS AND INTERPRETATIONS Section 1 .01 . Definitions. Unless the context clearly indicates otherwise, the following terms shall have the mean- ings assigned to them below when they are used in this Agree- ment: "Code" means the Internal Revenue Code of 1954, as amended, and the rules and regulations thereunder. "Escrow Fund" means the fund created by this Agreement to be administered by the Escrow Agent pursuant to the provisions of this Agreement. "Escrowed Securities" means the noncallable United States Treasury obligations described in Exhibit "D" attached to this Agreement, or cash or other direct obligations of the United States of America substituted therefor pursuant to Section 4.03 of this Agreement. Section 1.02 . Other Definitions. The terms "Agreement", "Issuer", "Escrow Agent", "Refunded Obligations" , "Refunding Obligations" and "Paying Agent" , when they are used in this Agreement, shall have the meanings assigned to them in the preamble to this Agreement. 2 Section 1 .03 . Interpretations. The titles and headings of the articles and sections of this Agreement have been inserted for convenience and reference only and are not to be considered a part hereof and shall not in any way modify or restrict the terms hereof. This Agreement and all of the terms and provisions hereof shall be liberally construed to effect- uate the purposes set forth herein and to achieve the intended purpose of providing for the refunding of the Refunded Obliga- tions in accordance with applicable law. ARTICLE II DEPOSIT OF FUNDS AND ESCROWED SECURITIES Section 2 .01. Deposits in the Escrow Fund. Concurrently with the sale and delivery of the Refunding Obligations the Issuer shall deposit, or cause to be deposited, with the Escrow Agent, for deposit in the Escrow Fund, the funds and Escrowed Securities described in Exhibit "D" attached hereto, and the Escrow Agent shall, upon the receipt thereof, acknowledge such receipt to the Issuer in writing. ARTICLE III CREATION AND OPERATION OF ESCROW FUND Section 3 . 01. Escrow Fund. The Escrow Agent has created on its books a special trust fund and irrevocable escrow (the "Escrow Fund" ) . The Escrow Agent hereby agrees that upon receipt thereof it will deposit to the credit of the Escrow Fund the funds and the Escrowed Securities described in Exhibit "D" attached hereto. Such deposit, all proceeds therefrom, and all cash balances from time to time on deposit therein (a) shall be the property of the Escrow Fund, (b) shall be applied only in strict conformity with the terms and conditions of this Agreement, and (c) are hereby irrevocably pledged to the payment of the principal of and interest on the Refunded Obligations, which payment shall be made by timely transfers of such amounts at such times as are provided for in Section 3 .02 hereof. When the final transfers have been made for the payment of such principal of and interest on the Refunded Obligations, any balance then remaining in the Escrow Fund shall be transferred to the Issuer, and the Escrow Agent shall thereupon be discharged from any further duties hereunder. Section 3 .02 . Payment of Principal and Interest. The Escrow Agent is hereby irrevocably instructed to transfer from the cash balances from time to time on deposit in the Escrow Fund, the amounts required to pay the principal of and interest on the Refunded Obligations when due in the amounts and at the times shown in Exhibit "C" attached hereto. Section 3 .03 . Sufficiency of Escrow Fund. The Issuer represents that the successive receipts of the principal of and interest on the Escrowed Securities will assure that the cash balance on deposit from time to time in the Escrow Fund will be at all times sufficient to provide moneys for transfer to the Paying Agent at the times and in the amounts required to pay the interest on the Refunded Obligations as such interest comes due and the principal of the Refunded Obligations as the Refunded Obligations mature, all as more fully set forth in Exhibit "E" attached hereto. If, for any reason, at any time, the cash balances on deposit or scheduled to be on deposit in the Escrow Fund shall be insufficient to transfer the amounts required by each place of payment (paying agent) for the Refunded Obligations to make the payments set forth in Section 3 . 02 hereof, the Issuer shall timely deposit in the Escrow Fund, from any funds that are lawfully available therefor, additional funds in the amounts required to make such payments. 3 Notice of any such insufficiency shall be given promptly as hereinafter provided, but the Escrow Agent shall not in any manner be responsible for any insufficiency of funds in the Escrow Fund or the Issuer' s failure to make additional deposits thereto. Section 3 .04. Trust Fund. The Escrow Agent shall hold at all times the Escrow Fund, the Escrowed Securities and all other assets of the Escrow Fund, wholly segregated from all other funds and securities on deposit with the Escrow Agent; it shall never allow the Escrowed Securities or any other assets of the Escrow Fund to be commingled with any other funds or securities of the Escrow Agent; and it shall hold and dispose of the assets of the Escrow Fund only as set forth herein. The Escrowed Securities and other assets of the Escrow Fund shall always be maintained by the Escrow Agent as trust funds for the benefit of the owners of the Refunded Obligations; and a special account thereof shall at all times be maintained on the books of the Escrow Agent. The owners of the Refunded Obliga- tions shall be entitled to the same preferred claim and first lien upon the Escrowed Securities, the proceeds thereof, and all other assets of the Escrow Fund to which they are entitled as owners of the Refunded Obligations. The amounts received by the Escrow Agent under this Agreement shall not be considered as a banking deposit by the Issuer, and the Escrow Agent shall have no right to title with respect thereto except as a con- structive trustee and Escrow Agent under the terms of this Agreement. The amounts received by the Escrow Agent under this Agreement shall not be subject to warrants, drafts or checks drawn by the Issuer or, except to the extent expressly herein provided, by the Paying Agent. Section 3 . 05. Security for Cash Balances. Cash balances from time to time on deposit in the Escrow Fund shall, to the extent not insured by the Federal Deposit Insurance Corporation or its successor, be continuously secured by a pledge of direct obligations of, or obligations unconditionally guaranteed by, the United States of America, having a market value at least equal to such cash balances. ARTICLE IV LIMITATION ON INVESTMENTS Section 4. 01. Except for the initial investment of the proceeds of the Refunding Obligations in the Escrowed Securi- ties, and except as provided in Sections 4.02 and 4. 03 hereof, the Escrow Agent shall not have any power or duty to invest or reinvest any money held hereunder, or to make substitutions of the Escrowed Securities, or to sell, transfer, or otherwise dispose of the Escrowed Securities. Section 4. 02 . Reinvestment of Certain Cash Balances in Escrow by Escrow Agent. In addition to the Escrowed Securities listed in Exhibit "D" hereto, the Escrow Agent shall reinvest cash balances shown in Exhibit "F" attached hereto in zero (0) interest rate United States Treasury Obligations - State and Local Government Series to the extent such Obligations are available from the Department of the Treasury. All such reinvestments shall be made only from the portion of cash balances derived from the maturing principal of and interest on Escrowed Securities that are United States Treasury Certifi- cates of Indebtedness, Notes, or Bonds - State and Local Government Series. All such reinvestments shall be acquired on and shall mature on the dates shown on Exhibit "F" attached hereto. Section 4.03 . Substitution for Escrowed Securities. Concurrently with the sale and delivery of the Refunding Obligations, but not thereafter, the Issuer, at its option, may 4 substitute cash or non-interest bearing direct obligations of the United States Treasury (i . e. , Treasury obligations which mature and are payable in a stated amount on the maturity date thereof, and for which there are no payments other than the payment made on the maturity date) for non-interest bearing Escrowed Securities, if any, listed in part III of Exhibit "D" attached hereto, but only if such cash and/or substituted non-interest bearing direct obligations of the United States Treasury - (a) are in an amount, and/or mature in an amount, which, together with any cash substituted for such obliga- tions, is equal to or greater than the amount payable on the maturity date of the obligation listed in part III of Exhibit "D" for which such obligation is substituted, and (b) mature on or before the maturity date of the obligation listed in part III of Exhibit "D" for which such obligation is substituted. If any such cash and/or obligations are so substituted for any Escrowed Securities, the Issuer may, at any time thereafter, substitute for such cash and/or obligations the same Escrowed Securities for which such cash and/or obligations originally were substituted. Section 4.04. Allocation of Certain Escrowed Securities. Except as provided in this Section 4. 04, the maturing principal of and interest on the Escrowed Securities may be applied to the payment of any Refunded Obligations and no allocation or segregation of the receipts of principal or interest from such Escrowed Securities is required. The maturing principal of and interest on the Escrowed Securities listed in Exhibit "G" hereto shall be allocated and applied only to pay the Refunded Obligations listed on Exhibit "G" hereto. Section 4.05. Arbitrage. The Issuer hereby covenants and agrees that it shall never request the Escrow Agent to exercise any power hereunder or permit any part of the money in the Escrow Fund or proceeds from the sale of Escrowed Securi- ties to be used directly or indirectly to acquire any securi- ties or obligations if the exercise of such power or the acquisition of such securities or obligations would cause any Refunding Obligations or Refunded Obligations to be an "arbitrage bond" within the meaning of Section 103(c) of the Code. ARTICLE V APPLICATION OF CASH BALANCES Section 5.01 . In General. Except as provided in Sections 3 .02 and 4.02 hereof, no withdrawals, transfers, or reinvest- ment shall be made of cash balances in the Escrow Fund. ARTICLE VI RECORDS AND REPORTS Section 6. 01 . Records. The Escrow Agent will keep books of record and account in which complete and correct entries shall be made of all transactions relating to the receipts, disbursements, allocations and application of the money and Escrowed Securities deposited to the Escrow Fund and all proceeds thereof, and such books shall be available for in- spection at reasonable hours and under reasonable conditions by the Issuer and the owners of the Refunded Obligations. 5 Section 6. 02 . Reports. While this Agreement remains in effect, the Escrow Agent annually shall prepare and send to the Issuer a written report summarizing all transactions relating to the Escrow Fund during the preceding year, including, without limitation, credits to the Escrow Fund as a result of interest payments on or maturities of the Escrowed Securities and transfers from the Escrow Fund for payments on the Refunded Obligations or otherwise, together with a detailed statement of all Escrowed Securities and the cash balance on deposit in the Escrow Fund as of the end of such period. ARTICLE VII CONCERNING THE PAYING AGENTS AND ESCROW AGENT Section 7 .01. Representations. The Escrow Agent hereby represents that it has all necessary power and authority to enter into this Agreement and undertake the obligations and responsibilities imposed upon it herein, and that it will carry out all of its obligations hereunder. Section 7 . 02 . Limitation on Liability. The liability of the Escrow Agent to transfer funds for the payment of the principal of and interest on the Refunded Obligations shall be limited to the proceeds of the Escrowed Securities and the cash balances from time to time on deposit in the Escrow Fund. Notwithstanding any provision contained herein to the contrary, neither the Escrow Agent nor the Paying Agent shall have any liability whatsoever for the insufficiency of funds from time to time in the Escrow Fund or any failure of the obligors of the Escrowed Securities to make timely payment thereon, except for the obligation to notify the Issuer promptly of any such occurrence. The recitals herein and in the proceedings authorizing the Refunding Obligations shall be taken as the statements of the Issuer and shall not be considered as made by, or imposing any obligation or liability upon, the Escrow Agent. The Escrow Agent is not a party to the proceedings authorizing the Refund- ing Obligations or the Refunded Obligations and is not respon- sible for nor bound by any of the provisions thereof (except as a place of payment and paying agent and/or a Paying Agent/- Registrar therefor) . In its capacity as Escrow Agent, it is agreed that the Escrow Agent need look only to the terms and provisions of this Agreement. The Escrow Agent makes no representations as to the value, conditions or sufficiency of the Escrow Fund, or any part thereof, or as to the title of the Issuer thereto, or as to the security afforded thereby or hereby, and the Escrow Agent shall not incur any liability or responsibility in respect to any of such matters. It is the intention of the parties hereto that the Escrow Agent shall never be required to use or advance its own funds or otherwise incur personal financial liability in the perfor- mance of any of its duties or the exercise of any of its rights and powers hereunder. The Escrow Agent shall not be liable for any action taken or neglected to be taken by it in good faith in any exercise of reasonable care and believed by it to be within the discretion or power conferred upon it by this Agreement, nor shall the Escrow Agent be responsible for the consequences of any error of judgment; and the Escrow Agent shall not be answerable except for its own action, neglect or default, nor for any loss unless the same shall have been through its negligence or want of good faith. 6 • Unless it is specifically otherwise provided herein, the Escrow Agent has no duty to determine or inquire into the happening or occurrence of any event or contingency or the performance or failure of performance of the Issuer with respect to arrangements or contracts with others, with the Escrow Agent' s sole duty hereunder being to safeguard the Escrow Fund, to dispose of and deliver the same in accordance with this Agreement. If, however, the Escrow Agent is called upon by the terms of this Agreement to determine the occurrence of any event or contingency, the Escrow Agent shall be obli- gated, in making such determination, only to exercise reason- able care and diligence, and in event of error in making such determination the Escrow Agent shall be liable only for its own misconduct or its negligence. In determining the occurrence of any such event or contingency the Escrow Agent may request from the Issuer or any other person such reasonable additional evidence as the Escrow Agent in its discretion may deem neces- sary to determine any fact relating to the occurrence of such event or contingency, and in this connection may make inquiries of, and consult with, among others, the Issuer at any time. Section 7 .03 . Compensation. (a) Concurrently with the sale and delivery of the Refunding Obligations, the Issuer shall pay to the Escrow Agent, as a fee for performing the services hereunder and for all expenses incurred or to be incurred by the Escrow Agent in the administration of this Agreement, the sum of $ , the sufficiency of which is hereby acknowledged by the Escrow Agent. In the event that the Escrow Agent is requested to perform any extraordinary services hereunder, the Issuer hereby agrees to pay reasonable fees to the Escrow Agent for such extraordinary services and to re- imburse the Escrow Agent for all expenses incurred by the Escrow Agent in performing such extraordinary services, and the Escrow Agent hereby agrees to look only to the Issuer for the payment of such fees and reimbursement of such expenses. The Escrow Agent hereby agrees that in no event shall it ever assert any claim or lien against the Escrow Fund for any fees for its services, whether regular or extraordinary, as Escrow Agent, or in any other capacity, or for reimbursement for any of its expenses. (b) In addition to the Escrow Agent, InterFirst Bank Dallas, N.A. , Dallas, Texas, MBank Wichita Falls, Wichita Falls, Texas and The Chase Manhattan Bank, N.A. , New York, New • York also are places of payment (paying agents) for some of the Refunded Obligations. Concurrently with the sale and delivery of the Refunding Obligations the Issuer shall pay to the Escrow Agent the sum of $ , the sufficiency of which is hereby acknowledged by the Escrow Agent, for all future paying agency services of the Escrow Agent and all of the other places of payment (paying agents) for any of the Refunded Obligations; and the Escrow Agent warrants that such sum is sufficient for such purpose, and that it has confirmed such sufficiency, and received approval of the arrangements herein made, with all of said places of payment (paying agents) . The Escrow Agent shall be obligated to make available to such other places of payment (paying agents) for the Refunded Obligations amounts from the Escrow Fund sufficient to pay when due the principal of and interest on any Refunded Obligations presented to them for payment, and to pay all charges of all places of payment (paying agents) for the Refunded Obligations for such paying agency services. * [The Issuer agrees separately and independently to pay to the Paying Agent/Registrar for the Issuer' s Series 1985 Bonds being refunded the fees and charges of such Paying Agent/Regis- trar for performing the registrar and transfer agent services of such Paying Agent/Registrar in accordance with the pro- visions of the proceedings authorizing the issuance of said Series 1985 Bonds, but that for such services as Paying 7 r Agent/Registrar relating solely to its function as registrar and transfer agent for the registration and transfer of said Series 1985 Bonds, said Paying Agent/Registrar separately will be responsible for billing the Issuer for its fees and expenses from time to time for continuing to act as such registrar and transfer agent. ]* (c) Upon receipt of the aforesaid specific sums stated in subsections (a) and (b) of this Section 7 .03 for Escrow Agent and paying agency fees, expenses, and services, the Escrow Agent shall acknowledge such receipt to the Issuer in writing. Section 7.04. Successor Escrow Agents. If at any time the Escrow Agent or its legal successor or successors should become unable, through operation or law or otherwise, to act as escrow agent hereunder, or if its property and affairs shall be taken under the control of any state or federal court or administrative body because of insolvency or bankruptcy or for any other reason, a vacancy shall forthwith exist in the office of Escrow Agent hereunder. In such event the Issuer, by appropriate action, promptly shall appoint an Escrow Agent to fill such vacancy. If no successor Escrow Agent shall have been appointed by the Issuer within 60 days, a successor may be appointed by the owners of a majority in principal amount of the Refunded Obligations then outstanding by an instrument or instruments in writing filed with the Issuer, signed by such owners or by their duly authorized attorneys-in-fact. If, in a proper case, no appointment of a successor Escrow Agent shall be made pursuant to the foregoing provisions of this section within three months after a vacancy shall have occurred, the owner of any Refunded Obligation may apply to any court of competent jurisdiction to appoint a successor Escrow Agent. Such court may thereupon, after such notice, if any, as it may deem proper, prescribe and appoint a successor Escrow Agent. Any successor Escrow Agent shall be a corporation organ- ized and doing business under the laws of the United States or the State of Texas, authorized under such laws to exercise corporate trust powers, having its principal office and place of business in the State of Texas, having a combined capital and surplus of at least $5,000,000 and subject to the super- vision or examination by Federal or State authority. Any successor Escrow Agent shall execute, acknowledge and deliver to the Issuer and the Escrow Agent an instrument accepting such appointment hereunder, and the Escrow Agent shall execute and deliver an instrument transferring to such successor Escrow Agent, subject to the terms of this Agreement, all the rights, powers and trusts of the Escrow Agent here- under. Upon the request of any such successor Escrow Agent, the Issuer shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor Escrow Agent all such rights, powers and duties. The Escrow Agent shall pay over to its successor Escrow Agent a proportional part of the Escrow Agent' s fee hereunder. ARTICLE VIII MISCELLANEOUS Section 8.01 . Notice. Any notice, authorization, re- quest, or demand required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given when mailed by registered or certified mail, postage prepaid addressed to the Issuer or the Escrow Agent at the address shown on Exhibit "A" attached hereto. The United States Post Office registered or certified mail receipt showing delivery of the aforesaid shall be conclusive evidence of the date and fact of delivery. Any party hereto may change the address to which 8 notices are to be delivered by giving to the other parties not less than ten ( 10) days prior notice thereof. Section 8.02 . Termination of Responsibilities. Upon the taking of all the actions as described herein by the Escrow Agent, the Escrow Agent shall have no further obligations or responsibilities hereunder to the Issuer, the owners of the Refunded Obligations or to any other person or persons in connection with this Agreement. Section 8.03 . Binding Agreement. This Agreement shall be binding upon the Issuer and the Escrow Agent and their respec- tive successors and legal representatives, and shall inure solely to the benefit of the owners of the Refunded Obliga- tions, the Issuer, the Escrow Agent and their respective successors and legal representatives. Section 8. 04. Severability. In case any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement, but this Agree- ment shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein. Section 8.05 . Texas Law Governs. This Agreement shall be governed exclusively by the provisions hereof and by the applicable laws of the State of Texas. Section 8. 06. Time of the Essence. Time shall be of the essence in the performance of obligations from time to time imposed upon the Escrow Agent by this Agreement. Section 8. 07 . Effective date of Agreement. This Agree- ment shall be effective upon receipt by the Escrow Agent of the funds described in Exhibit "D" attached hereto and the Escrowed Securities, together with the specific sums stated in subsec- tions (a) and (b) of Section 7.03 for Escrow Agent and paying agency fees, expenses, and services. . EXECUTED as of the date first written ay •e. s By ATTEST: -J-e-tYre-4.4 rA(/-1-91-4ed (SEAL) By Vice President & Trust Officer ATTEST: Trust Officer (SEAL) 9 INDEX TO EXHIBITS Exhibit "A" Addresses of the Issuer and the Escrow Agent Exhibit "B" Description of the Refunded Obligations Exhibit "C" Schedule of Debt Service on Refunded Obligations Exhibit "D" Description of Beginning Cash Deposit (if any) and Escrowed Securities Exhibit "E" Escrow Fund Cash Flow Exhibit "F" Reinvestments in Zero Coupon SLGS Exhibit "G" Open Market Reinvestments Exhibit "H" Allocation of Certain Escrowed Securities • EXHIBIT "A" ADDRESSES OF THE ISSUER AND ESCROW AGENT ISSUER City of Wichita Falls 1300 7th Street P. 0. Box 1431 Wichita, Falls, Texas 76307 Attention: Manager ESCROW AGENT InterFirst Bank Wichita Falls, N.A. 800 E. Scott Street Drawer 60 Wichita Falls, Texas 76307 Attention: Corporate Trust Department EXHIBIT "B" DESCRIPTION OF THE REFUNDED OBLIGATIONS City of Wichita Falls General Obligation Bonds, Series 1963, dated August 1, 1963, currently outstanding in the aggregate principal amount of $360, 000; City of Wichita Falls General Obligation Bonds, Series 1968, dated January 10, 1968 , currently outstanding in the aggregate principal amount of $1,000,000; City of Wichita Falls General Obligation Bonds, Series 1968-A, dated December 1, 1968, currently outstanding in the aggregate principal amount of $1,000, 000; City of Wichita Falls General Obligation Bonds, Series 1970 , dated February 15, 1970, currently outstanding in the aggregate principal amount of $600,000; Wichita Falls General Obligation Bonds,of ich g , Series City 1971, dated February 15, 1971, currently outstanding in the aggregate principal amount of $750,000; City of Wichita Falls General Obligation Bonds, Series 1980, dated June 15, 1980, currently outstanding in the aggregate principal amount of $3, 100,000; City of Wichita Falls General Obligation Bonds, Series 1981, October 1, 1981, currently outstanding in the aggregate principal amount of $4, 350,000; City of Wichita Falls General Obligation Bonds, Series 1982, dated August 1, 1982, currently outstanding in the aggregate principal amount of $2, 725,000; Wichita County Water Control and Improvement District #5, Water Revenue and Tax Bonds, Series 1956 dated November 1, 1956 , currently outstanding in the aggregate principal amount of $80,000; Wichita County Water Control and Improvement District #6, Water and Sewer Revenue and Tax Bonds, Series 1959, dated September 1 , 1959, currently outstanding in the aggregate principal amount of $100 ,000; Wichita County Water Control and Improvement District #4, Water Revenue and Tax Bonds , Series 1959, dated September 1, 1959, currently outstanding in the aggregate principal amount of $105,000; • EXHIBIT "C" SCHEDULE OF DEBT SERVICE ON REFUNDED OBLIGATIONS TO BE PROVIDED BY ACCOUNTING FIRM • . EXHIBIT "D" ESCROW DEPOSIT I . CASH II . STATE AND LOCAL GOVERNMENT SERIES OBLIGATIONS Principal Amount Interest Rate Maturity Date III . OTHER OBLIGATIONS Principal Interest Maturity Description Amount Rate Date • r • • EXHIBIT "E" ESCROW FUND CASH FLOW To Be Provided By Accounting Firm 1 • ( s I EXHIBIT "F" REINVESTMENTS IN ZERO COUPON SLGS Principal Amount Purchase Date Maturity Date • • • , • EXHIBIT "G" OPEN MARKET REINVESTMENTS Date of Maturity of Reinvestment Amount Investment Obligation r - EXHIBIT "H" ALLOCATION OF CERTAIN ESCROWED SECURITIES The maturing principal of and interest on the Escrowed Securities listed below shall be allocated and applied only to pay the Refunded Obligations listed below opposite such Escrowed Securities: Escrowed Securities' Refunded Obligations r NOTICE OF REDEMPTION CITY OF WICHITA FALLS, TEXAS GENERAL OBLIGATION BONDS NOTICE IS HEREBY GIVEN that the City of Wichita Falls, Texas , has called for redemption all of the outstanding Bonds of the following described issue ON DECEMBER 1, 1989 City of Wichita Falls General Obligation Bonds, Series 1981 , dated October 1 , 1981, currently outstanding in the aggregate principal amount of $4,350,000; and has also called for redemption all of the outstanding Bonds of the following described issue ON AUGUST 1 , 1992 City of Wichita Falls General Obligation Bonds, Series 1982, dated August 1, 1982, currently outstanding in the aggregate principal amount of $2, 725,000. Said above described Bonds of each series shall be redeemed at InterFirst Bank Wichita Falls, N.A. , Wichita Falls, Texas (formerly City National Bank in Wichita Falls, Wichita Falls, Texas) the place of payment of said Bonds. Upon presentation thereof at said place of payment on the redemption date, the holders of said Bonds of each series shall be entitled to receive par and accrued interest to said redemption date. NOTICE IS FURTHER GIVEN that due and proper arrangements have been made for providing the place of payment of said Bonds called for redemption with funds sufficient to pay the principal amount of said Bonds and the interest thereon to the redemption date. In the event said Bonds, or any of them, are not presented for payment by the respective date fixed for their redemption, they shall not thereafter bear interest. THIS NOTICE is issued and given pursuant to the optional redemption provisions set forth in the proceedings authorizing the issuance of the aforementioned Bonds , in accordance with the recitals and provisions of each of said Bonds and pursuant to authority of an Ordinance passed by the City Council of the City of Wichita Falls, Texas on the 27th day of August, 1985 . WITNESS MY OFFICIAL SIGNATURE, this the day of August, 1985. Director of Finance City of Wichita Falls, Texas r dAa-4 eta , if- 81.: Affidavit of Publication THE STATE OF TEXAS COUNTY OF WICHITA (Paste Clipping Here) On this 30 day of . Augus t ORDINANCE NO.$9-85 ORDINANCE AUTHOMIING 1 E ISSUANCE FUUNDI ATION REF AL M- A.D. 1985 • personally appeared before me, the undersigned authority PROVEMENT BONDS, SERIES 1985, AUTHORIZING THE EX- Toni Belvedere , bookkeeper ELUTION OF A BOND PURCHASE CONTRACT, AP- PROVING AN OFFICIAL STATE- MENT AND THE EXECUTION OF for the Times Publishing Company of Wichita Falls, publishers of the AN ESCROW AGREEMENT Wichita Falls Record News, a newspaper published at Wichita Falls in Wichita County, Texas, and upon being duly sworn by me, on oath states that the attached,advertisement is a true and correct copy of advertising published in 0NE(1) issues thereof on the following dates: Aug. 30 • Bookkeeper for Times Publishing Company of Wichita Falls Subscribed and sworn to before me this the day and year first above (SEAL) written. (;)27-). ;q®, JOY DAVIS „ Notary Public, Texas Z 8 v,3;•.. 3 My s Commission Expire _„ too • • • 4