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HomeMy WebLinkAboutORD 10.13.1967 - Issuance of Bonds78 AN ORDINANCE BY TIIE CITY COUNCIL OF THE CITY OF GEORGET`J'4VN, TL AS , AVTHORIZING TIIE ISSU1vNCL 01' Aj V- Z,'NUE BONDS OF SAID CITY IN TiE TOTAL PRINCIPAL AMOUI T OF �75,000 (BEING TIT-E SECOND AND FINAL INSTALL�,j-aNT OF A TOTAL VOTED AUTHORIZATION OF ,�400, 000) , OF' WHICH �5, 000 OF BONDS RILE AUTHORIZED FOR THE PURPOSE OF CONSTRUCTING EXTE'`TSIONS AND Ii - PROV111iZNTS TO THE CITY' S IVATEuh�' ORKS SYST1211I AND $70, 000 OF BONDS A:LE AUTIIOILIZED FOR THE PUE'OSE OF CONSTRUCT- ING EXTENSIONS AND IMIPROV uIENTS TO TIIE C ITY' S SF%V ;;"t SYST"LK; PRESCRIBING THE' FOIL&II, TEEMS AND CONDITIONS OF THE BONDS AND TIIE FORM OF THE INTEREST COUPONS; PLEDGING THE REVENUES OF THE C ITY' S COMBINED ' IATE11- !XIUI S, SEIVER, AND ELECTRIC LIGHT SYSTE.N TO THE PAPME24T OF P11INCIPAL OF AND INTETREST ON SAID BONDS AFTER DEDUCTION OF REASONABLE EYPLNSES OF OPERATING AND ILAXITAIItiING SAID COMBIivNED SYSTEM; MAKING CERTAIN COVLNA.NTS OF SAID CITY WITH REFERENCE TO THE BOND F'[ND FEW,! WHICH SAID PRINCIPAL AND INTLHEST ARE TO BE PAID; 0iACTING PROVISIONS INCIDENT AND RELATING TO THE SUBJECT AND PURPOSE OF THIS ORDINANCE; CONFII&1- It:G THE SALE OF THE BONDS; AND DECLARING AN h11EiiAGLNCY. f IVHEIIEAS, at an election held for that purpose on February 26, 1966, the City Council of the City of Georgetown was authorized by a majority of the qualified voters who were property taxpayers of said City, voting at said election to issue $400,000 revenue bonds of said City as follows: $50,000 of bonds for the pupose of constructing extensions and improve- ments of the City's waterworks system, $150,000 of bonds for the purpose of constructing extensions and improvements to the City's sewer system, and w4"200,000 of bonds for the purpose of constructing extensions and improvements to the City's electric light system; such bonds to bear interest at a rate not to exceed five per cent (5YL) per annum, and to mature serially over a period of years not to exceed thirty (30) years from their date; and WHE112JIS1 it was provided in the order calling said election and in the notice -of such election that the bonds of the three series hereinabove mentioned were to be ratably secured in such manner that no one bond shall have priority of lien over any other bond or bonds, it being the intent to provide for the creation of an indebtedness against the City's combined waterworks, sewer and electric light sys- tem for the purposes therein stated; such bonds, if approved by the qualified voters, voting at said election, to be issued in one or more installments, but as a single combined authorization, and to be payable from the -same source as are the "City of Georgetown Utility System Revenue Bonds, Series 1964," dated June 1, 1964, and secured by the same revenues, and to occupy a position of parity in all respects with said Utility System Revenue Bonds, Series 1964; and ';t�Il MAS, on Niay 2, 1966, the City Council passed an ordinance authorizing the issuance of $325,000 of the bonds so authorized at said election, such bonds being designated CITY OF GEORGETRN UTILITY SYSTE11,I AMDO I BONUS, SERIES 1966, and dated June 1, 1966, of which $45,000 of bonds were issued for the purpose of constructing extensions and improvements to the City's waterworks system,-$80,000 of bonds were issued for the purpose of constructing extensions and improvements to the City's sewer system, and--$200,000 of bonds were issued for the purpose of constructing extensions and improvements to the City's electric light system; and ti'•J%fMEAS, said $325,000 of bonds were duly approved by the Attorney General of the State of Texas, registered by the State Comptroller, and sold and delivered; and WMEUEAS, the City Council now deems it advisable and to the best interest of the City of Georgetown to make further- extensions and improvements to the City's waterworks system and to issue the $5,000 balance of bonds so authorized at said election of February 26, 1966, for such purpose, and to make further extensions and improvements to the City's sewer system and to issue the $70,000 balance of bonds so authorized at the aforesaid election for such purpose; and 'MULR111S, the City Council has determined that the City is not in default as to any covenant, condition or obligation -prescribed by the ordinances authorizing the issuance of said City of Georgetown "Utility System Revenue Bonds, Series 1964," and "Utility System Revenue Bonds,,Series 1966," and has complied with all the require- ments set out in said ordinances with reference to the issuance of additional parity revenue bonds; and 5q1EHLAS, it is now necessary and proper that the City Council proceed with the issuance of such $75,000 of bonds; TTIEIlt FORD, BE IT 0.0AINED 13Y THE CITY COUNCIL OF T1 ti' CITY OF GEORGETOUNT , TEXAS: SECTION 1, That the City Council of the City of Georgetown, Texas, by virtue of the authority expressly conferred upon it by all the resident qualified property taxpaying voters of said City, who owned taxable property in the City and who had duly rendered the same for taxation, voting at an election held for that purpose on February 26, 1966, and pursuant to the general laws of the State of Texas, particularly Articles 111.1 - 1118, inclusive, of the Revised Civil Statutes of Texas,.as amended, has determined that there shall be issued, and there is hereby issued, a series of coupon Bonds in the total principal amount of S1VENTY-FIVE `THOUSAND DOLLA_6 ($75,000)1 os which $5,000 of Bonds shall be issued for the purpose of con- structing extensions and improvements to the City's waterworks system and v70,000 of Bonds shall be issued for the purpose of constructing extensions and improvements to the City's sewer system. That said Bonds shall be designated CITY OF GEOAdETOI1W UTILITY SYSTEM .LUX-TI.^NE BONDS, SEi?IES 1967, and shall be payable together with the outstand- ing "City of Georgetown Utility System Revenue Bonds, Series 1964," dated June 1, 1964, and the outstanding "City of Georgetown Utility System Revenue Bonds, Series 1966," dated June 1, 1966, solely from and secured by a first lien on and pledge of the revenues of the City's combined waterworks, sewer and electric light system, after deduction of reasonable operation and maintenance expenses, as such expenses are defined by statute. SECTION 2. That said Bonds shall be dated November 1, 1967; shall be numbered consecutively from One (1) to Fifteen (15), both inclusive; shall be of the denomination of Five Thousand Dollars (;;5,000) each; and shall become due and payable serially in accordance with the following schedule: BOIKJ NUtiiB ELS i;'�iTUiLITY DATES A;.IOU1,TTS 1 June 1, 1969 5,000 2 June 1, 1970 5,000 3 June 1, 1971 5,000_ 4 June 1, 1972 5,000 5 June 1, 1973 5,000 6 June 1, 1974 5,000 7 June 1, 1975 52000 8 June 11 1976 52000 9 June 1, 1977 52000 10 June 1, 1978 51000 11 June 1, 1979 5,000 12 - 15 inc. June 1, 1980 20,000 SECTION 3. That said Bonds shall bear interest from date until paid as follows: Bonds numbered 1 to 5, inclusive, maturing June 1, 1969 through June 1, 1973, at the rate of FIVE PEA CINT (5;,,) per annum; and Bonds numbered 6 to 15, inclusive, Maturing June 1, 1974 through June 1, 1980, at the rate of FOU3R 10;jI ON1,J:kLF, PMi Cl!i,IT (4-1/2,d) per annum; such interest to be evidenced by proper coupons attached to each of said Bonds and to be payable June 1, 1968, and seini-annually there- after on December 1st and June Ist in eacli year. SL•CTIU:• That both principal of and interest on the Bonds shall be payable in lawful money of the United States of lAmerica, upon presentation and surrender of bonds or proper coupons at the Citizens State Bank, Georgetown, Texas, or at the option of the bearer, at the First National Bank, Georgetown, Texas, or at the Texas Bank and Trust Company of Dallas, Texas, without exchange or collection charges to the bearer thereof. SECTIO'iv 5. That said Bonds and the interest coupons appurtenant thereto shall be signed by the imprinted facsimile signature of the Mayor of the City of Georgetown, Texas, and countersigned by the im- printed facsimile signature of the City Secretary, and the execution of such Bonds and coupons in such -manner shall have the same effect as if such Bonds and coupons had been signed by the Mayor and City Secretary in person by their manual signatures. inasmuch as such Bonds are required to be registered by the Comptroller of Public Qj Accounts of the State of Texas, only his signature, or that of a deputy designated in writing to act for the Comptroller, shall be required to be manually subscribed to such Bonds in connection with his registration certificate to appear thereon as hereinafter pro- vided, all in accordance with the provisions of Article 717j-1, Vernon's Civil Statutes of Texas, 1925, as amended. That the official seal of the City of Georgetown, T xas, shall be impressed, or a facsimile thereof shall be printed, on each of said Bonds. SECTION 6. That said Bonds shall be substantially in the following form: IvO. UNITED STATES OF AI:;EHICA STATE OF TEXAS COU'dTY OF IiIiILLIAMSON, CITY OF GEORGETO`ilN UTILITY SYSTEM IkEVEdUL BOND, SERIES 1967 The City of Georgetown, a lawfully created and existing municipal corporation in `.'.'illiamson County, Texas, F0I6' VALUE LECEIVFD, hereby promises to pay to bearer, solely from the special funds hereinafter specified, the sum of FIVE THOUS `:ND DOLLARS (5,000), on the 1st day of June, 19 amd frp, saod s-ecoa; fiords to pay interest thereon from the date hereof at the rate of percent l per annwn, on June 1, 1968, and semi-annually there- after on December lst and June lst in each year until the principal amount of this Bond shall have been paid. The principal of this Bond and the interest coupons attached hereto shall be payable to bearer, in lawful money of the United States of America, without exchange or collection charges to the bearer, upon presentation and surrender of this Bond or proper interest coupons at the Citizens State Bank, Georgetown, Texas, or, at the option of the bearer, at the First National Bank, Georgetown, Texas, or, at the Texas Bank,and Trust Company of Dallas, Dallas, Texas. 82 This Bond is one of a series of 15 Bonds, numbered consecutively from. 1 to 15, inclusive, of the denomination of live Thousand Dollars ($5,000) each, aggregating Seventy-five Thousand Dollars (:75,000); Bonds of said Series in the amount of i5,000 being issued by the City of Georgetown for the purpose of constructing extensions and improvements to its waterworks system and fonds of said Series in the amount of $70,000 bein;; issued by said City for the purpose of construct- ing extensions and improvements to its sewer system, in accordance with the Constitution and laws of the State of Texas, particularly :articles 1111 - 1118, both inclusive, of the Revised Civil Statutes of Texas, 1925, as amended, and by authority of a vote of the quali- fied property taxpaying voters of the City of Georgetown, Texas, who owned taxable property therein and who had duly rendered the same for tax- ation, voting at an election held for that purpose within said City, on February 26, 1966, and pursumit to an ordinance passed by the City Council of the City of Georgetown and duly recorded in the ioiinutes of said City Council. The date of this Bond, in conformity with -the ordinance above mentioned, is November 1, 1967. This Bond, and all Bonds of the Series of which it is a part, together with the City of Georgetown "Utility System Revenue Bonds, Series 1964," and "Utility System Revenue Bonds, Series 1966," con- stitute special obligations of the City of Georgetown, payable as to both principal and interest solely from and equally secured by a first lien on and pledge of the revenues of the City's combined waterworks, sewer and electric light system, including all additions, extensions and improvements thereto which may hereafter be made (hereinafter referred to as the "Utility System"), after deduction of reasonable expenses'of operation and maintenance. The City reserves the right to issue additional bonds, in all things on a parity with the Bonds of this Series, and payable from and equally secured by a first lien on and pledge of the net revenues of the City's Utility System; PROVIDED, HOWEVI;lt, that any and all such further bonds may be so issued only in accordance with and sub- ject to the covennants, limitations, conditions and restrictions relating thereto which are set forth and contained in the ordinance authorizing this Series of Bonds and to which said ordinance refer- ence is hereby made for more complete and full particulars. The holder hereof shall never have the right to demand payment of this obligation out of any funds raised or to be raised by tax- ation. Each holder of this Bond, payable to bearer, or of the interest coupons hereto attached, is conclusively presumed to forego and renounce his equities in favor of subsequent holders for value with- out notice and to agree that, being payable to bearer, this Bond, and each of the interest coupons attached, may be negotiated by delivery howsoever possession may have been acquired; and that any subsequent holders who may receive this bond, or any of the coupons attached, for value without notice, has thereby acquired absolute title free from all equities and claims of ownership of any prior holder. The City of Georgetown, its officers and the paying agents shall not be affected by any notice to the contrary. AND IT IS I REBY CERTIFIED AND RECITED that the issuance of this Bond, and the Series of which'it is a part, is duly authorized by law; that all acts, conditions and things required to exist and to be done precedent to and in the issuance of this Bond to render the same law- ful and valid have been properly done, have happened and have been performed in regular and due time, form and manner, as required by the Constitution and laws of the State of Texas and the ordinance hereinabove mentioned; and that this Series of Bonds does not exceed any constitutional or statutory limitation; and that provision has been made for the payment, of the principal of and the interest on this Bond, and the Series of which it is a part, by irrevocably pledging the revenues of the City's utility System. IN "U'ITNE'SS ':�_I OF, this ,Bond and the interest coupons attachedl �AM M hereto have been signed by the imprinted facsimile signature of the liayor of said City and countersigned by the imprinted facsimile signature of the City Secretory of said City, and the official seal of said City has been duly impressed or printed on this bond. COUN `I'ERS IGNLD : Jay C. Sloan, N,.ayor City of Georgetown, Texas Claud Eads, City Secretary City of Georgetown, Texas SECTION 7. That the form of said interest coupons shall be substantially as follows: NO. ON TFE 1ST DAY OF 19 _ The City of Georgetown, Texas, will pay to bearer out of funds specified in the Bond to which this coupon is attached at the Citizens State i3ank, Georgetown, Texas, or, at the option of the bearer, at the First National Hunk, Georgetown, Texas, or at the Texas Hank and Trust Company of Dallas, Dallas, Texas, without exchange or collection charges to the bearer hereof, the sum of Dollar G ), in lawful money of the United States of America, said sum being months' interest due that day on CITY OF GE0AGETO1,N UTILITY SYSTEM _'RLVENJE BOND, SERIES 1967, dated November 1, 1967, No. , to which this coupon is attached and is a part thereof. The holder hereof shall never have the right to demand payment of this obligation out of any funds raised or to be raised by taxation.. Claud Eads, City Secretary Jay C. Sloan, Mayor SECTION 8. That substantially the following, certificate shall be printed on the back of each Bond: C0NiYTAOLLER'S REGISTIUTION CERTIFICATE: iti;GISTEt N0. I HEREBY CEIMFY that this !Bond has been examined, certified as to validily, 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. 1VITNLSS MY SIGNAT'U.tE and seal this Comptroller of Public Accounts of The State of Texas SECTION 9. DEFINITIONS. The following words, terms and express- ions used in this Ordinance shall have the folloitiinc; meanings unless the context indicates or implies a different meaning: (a) "City" means the City of Georgetown. (b) "City Council" or "Council" means the governing body of the City of Georgetown. (c) "Bonds" shall mean the ;?'75,000 of revenue bonds authorized by this ordinance. (d) "Outstanding Bonds" shall mean collectively the "City of Georgetown Utility System Revenue bonds, Series 1964," dated June 1, 1964, and the "City of Georgetown Utility System ievenue Bonds, Series 1966," dated June 1, 1966. (e) "Parity Bonds" shall mean collectively the Bonds and the Outstanding Bonds. (f) "Additional -bonds" shall mean the additional parity revenue bonds permitted to be issued under the provisions of the ordinances authorizing the rarity ]Bonds. (g) "Utility System" shall mean the System created and establish- ed for and on behalf of the City under the provisions of the ordinance authorizing the "City of Georgetown Utility System ;tevenue Bonds, Series 1964." kh) "Net Revenues" and "Pledged levenues" shall mean the revenues derived from the operation of the Utility System as such revenues are defined and pledged in Section 11 of this ordinance. (i) "Utility System Revenue Fund," "Utility System Revenue Bonds Interest and Sinking Fund," "Utility System Revenue Bonds heserve Fund," and"Utility System Contingency Fund," shall mean the special funds which the City Council has heretofore created and ordered to be established and maintained for the payment of expenses of operating and maintaining the Utility System and costs of certain repairs or replacements to said System and for the payment of prin- cipal of and interest on bonds outstanding against the Utility System as hereinafter more specifically stated. SECTION 10. UTILITY SYSTi1. That the UTILITY SYST0,(herein- after sometimes called the "System"), as created and established by the City Council, is comprised of the entire waterworks system, the entire sewer system, and the entire electric light system now owned and operated by the City of Georgetown, Texas, together with all improvements, extensions and additions thereto which may be made while any Parity Bonds or additional Bonds remain outstanding against the System. Such Utility System shall be operated on the basis of a fiscal year commencing on September 1st of each year and ending on August 31st of the following year. SECTION 11. Pledg-e of aeventie:s. The Bonds herein authorized and the outstanding City of Georgetown "Utility SystemJIL'evenue Bonds, Series 1964," dated June 1, 1964, and Utility System revenue Bonds, Series 1966," dated June 1, 1966, shall be equally and ratably secured by and payable from an irrevocable first lien on and pledge of the income and revenues derived and to be derived from, the oper- ation of the System, after deduction therefrom of the amount necessary to pay all operating, maintenance, replacement and betterment charges of the System, as is required by Article 1113, of the i,evised Civil Statutes of Texas, 1925, as amended, and by other applicable Statutes of the State of Texas. Si MUN 12. '4ALYTEXILNGE UP RATL_;. The City hereby covenants and agrees that it will, at ail times, while any of the Parity Bonds or any Additional Bonds, or any interest thereon, are outstanding and unpaid, charge and collect for services rendered by said Utility System rates sufficient to pay all maintenance, depreciation, replace- ment, betterment, and interest charges and to provide an Interest and Sinking Fund sufficient to pay the interest and principal of such bonds as such interest and principal mature and any outstanding indebtedness of said System, as is required by applicable Statutes of Texas. For the benefit of the original purchasers and for the benefit of any and all subsequent holders of the Parity Bonds, Additional Bonds, coupons, or any part thereof, and in addition to all other provisions and covenants in the laws of the State of Texas, and in this ordinance; it is expressly covenanted that the City shall fix and maintain rates and collect charges for the facilities and ser- vices afforded by the System to the City and to all other customers which will provide revenues sufficient at all times: (a) To pay all operating, maintenance and replacement charges of the Utility System, as is required by Article 1113 of the Civil Statutes, as amended, and by other applicable Statutes of the State of Texas. (b) To establish and maintain the Interest and Sinking Fund and the heserve Fund for the Parity Bonds and for any Additional Bonds; (c) To pay in addition all outstanding; indebtedness against the Utility System other than the Parity Bonds, or any Additional Bonds, as and when the same becomes due; and (d) To provide for the payments into the "Contingency Fund" as required under the provisions of the Ordinances authorizing the issuance of the Parity Bonds. SECTION 13. UTILITY SYSTIN RLVLi'NUE FUND. There shall,be deposited in the I.:tility System Revenue fund (already established) as collected all revenues derived from the operation of the Utility Sys- tem, which fund shall be maintained separate and apart from all other funds of the City. Such Utility System Revenue Fund shall be maintained so long as any Parity Bonds, or any Additional Bonds, remain outstand- ing, in the City's official Depository, and shall be administered as 8:5 follows: (a) OPLUATIONT AND KAINTI dANCI" FXTENTSES: The money in the Utility System Revenue Fund shall be used first for the payment of the reasonable and proper expenses of operating and maintaining the Utility System, including salaries, labor, materials, interest, repairs and extensions necessary to render efficient service. The words "Illepairs" and "extensiohs;: as used in this paragraph shall be construed to refer only to such repairs and extensions, as in the judgment of the govern- ing body of the City, are necessary to keep the System in operation and render adequate service to the City and the inhabitants thereof, or such as might be necessary to remedy some physical accident or con- dition which would otherwise impair the security of the Parity Bonds or any Additional Bonds. (b) BOND FUND: The amounts to be paid into the Utility System Revenue Bonds Interest and Sinking fund (already established and hereinafter called the "Bond Fund") during each year in which any of the Parity Bonds, or any Additional Bonds, are outstanding, shall be an amount equal to 100 per centum of the amount required to meet the interest and principal payments falling due on or before the next maturity date of the Parity Bonds o-r any Addition Bonds then out- standin. On or before the loth day of each month, after payments have been made as required by subsection (a) of this Section 13, the City shall withdraw from the Utility System Revenue Fund and deposit into the bond Fund an amount not less than the total of: 1/12th of the next maturing installments of principal of the Parity Bonds then out- standing, and of any Additional 13onds then outstanding, and 1/6th of the next semi-annual installment of interest on the Parity Bonds then outstanding and on any Additional Bonds then outstanding. The monies in the Bond Fund shall be used so'_ly for the purpose of paying the interest on and the principal of the Parity Bonds, and any additional Bonds, until all such bonds have been retired. In the event the income and revenues of the Utility System are insufficient in any month to permit the required deposits into the Bond Fund in full accord with the provisions hereof, then the amount of any deficiency shall be added to the amount otherwise required to be deposited into said Bond Fund in the next month, until all deficiencies are rectified. That concurrently with the delivery of the :fonds to the pur- chasers thereof, all sums of money received from the purchasers as accrued interest paid on the Bonds shall be placed in the Bond fund. (c) 1CLSL:I1'E Commencing on the loth day of the month followsing delivery and payment for the lionds, and on or before the loth day of each month thereafter, after payments have been amde as required by subsections (a) and (b) of this Section 13, the City shall withdraw from the Utility System Revenue Fund and deposit into the Utility System Revenue Bonds ILeserve Fund (already established and hereinafter called the "reserve Fund"), in addition to the payments and deposits otherwise required to be made therein, the sum of $ 117.00 until an additional debt service reserve of i8.424.uu on the outstanding Bonds has been established, and thereafter, such sums monthly as may be necessary to maintain the required reserve of �64.308.00 on the Parity Bonds. The City covenants and agrees that in the event Additional Bonds are issued as hereinafter provided, the ordinance authorizing such Additional Bonds shall provide for the payment into the reserve Fund of such addi- tional sums as shall be necessary to permit an accumulation in the Re- serve Fund, within six years from the date of the Additional Bonds, as an additional reserve, of an amount of money at least equal to one year's average annual principal and interest requirements of the Additional Bonds then outstanding. The Reserve Fund shall be used to pay principal of or interest on the Parity Bonds and such Additional Bonds falling due at any tine for the payment of which there is no money available in the Bond Fund. No payments need be made into the Aeserve Fund after there shall have been accumulated and shall exist in said fund the amount of money herein stiplated; but if at any time it becomes necessary to use temporarily any part of such :Lweserve Fund for the payment of principal or interest, or i_t is otherwise depleted, pay- ments into the Reserve Fund shall be resumed and continued until such time as such Fund contains the amount of money then required to be on deposit therein. The City's official ;Depository is hereby authorized to invest the money in the Reserve Fund in direct obligations of or obligations unconditionally guaranteed by the United States Government, having maturities not in excess of five (5) years from the date of the making of such investment, as the City Council may direct. Said obligations shall be deposited in escrow with said Depository under an escrow agreement, and if at any time uninvested funds shall be insufficient to permit payment of principal and interest maturities of the Parity Bonds or any Additional Bonds then outstanding as heretofore directed, said Depository shall sell on the open market such amount of the securities as is required to pay said Parity Bonds or Additional Bonds and the interest thereon when due, and shall give due notice thereof to the City of Georgetown. All TTToney resulting frog the maturity of principal and interest of the securities in which the Reserve Fund is invested may be reinvested and accumulated in said iteserve Fund and considered a -Dart thereof and used for and only for the purposes hereinabove provided with respect to said Fund. (d) CONTING12KCY FUI D: Based on an annual review of the experience as to the cost of repairs and replacements to the Utility System necessitated by the occurring of -emergencies and the recommendation of the City's Consulting Engineer, the City Council has determined that the Utility System Contingency Fund (hereinafter referred to as the "Contingency Fund"), heretofore created and ordered to be established and maintained in the amount of 5M ,000 is sufficient for the time being. The Contingency Fund shall be used to pay the (1) cost of any repairs or replacements to the Utility System necessitated by the occurring of an emergency and (2) interest on and/or principal of the Parity Bonds or any Additional Bonds, when other funds of the City are insufficient for such purpose. The City covenants and agrees that in the event Additional Bonds are issued, the ordinance authorizing such additional Bonds shall provide for such appropriate additional or larger amounts to be accumulated in the Contingency Fund as deemed advisable by the City Council, based on an annual review of the experience as to the cost of repairs and replacements to the Utility System necessitated by t he occurinb of eii-�ergencies and the recor,T:aendation of a Consulting 'engineer. No paraents need be :Wade into the Contingency Fund after there s'..--1I1 have been accumulated in said Fund the amount of money then required to be on deposit therein, except that wherever any money is paid out of said Fund, payn:erts into the fund shall be reswiied and continues: until such tii:le as the Fund has been restored to the required sun. The City's official Depository is hereby authorizes) to invest the money in the Contingency Fund in direct obligations of or obligations unconditionally guaranteed by the United States Government, having maturities not in excess of five (5) years from the date of the making of such investment, as the City Council may direct. Any obligations in which money is so invested shall be kept insescrow in said Depository and shall be promptly sold and the proceeds of sale applied to the making of payments required to be made from the Contingency Fund, whenever such payments are required to be made under the foregoin(r provisions of this ordinance. (e) SUiG'LiJS FUNDS: All moneys remaining in the Utility System ileve.ue Fund after the requirements of subsections (a), (b), (c) and (d) of this erection 13 have been met (including any increased payments in- to the aforesaid ::fond Funs:, Reserve Fund, and Contingency Fund as may be necessary by reason of the issuance of Additional Bonds in the future under the provisions of the ordinances authorizing the Parity Bonds), and after all deficiencies shall have been amde up and all replacements made, shall be either used or accumulated for the making of improvements, extensions and additions to the Utility System,'or may, in the discre- tion of the City be used for any other proper city purpose now or here- after permitted by law, including the use thereof in retiring in advance of maturity any additional Bonds then outstanding, in accordance with the provisions made for their prior redemption, or may be used to purchase the Parity Bonds and Additional Bonds on the open market at not exceeding the market value thereof. All bonds so paid, redeemed or purchased shall be cancelled and shall not be re -issued. Nothing herein shah) be construed however, as iipluairing the right of the City to pay in accordance with the provisions thereof any junior lien bonds hereafter legally issued by it. 7 SECTION 14. Security for Funds. All monies which are to be paid into the Depository under the provisions of the ordinances authorizing the Parity Bonds shall be secured in accordance with the laws of the State of Texas applicable thereto, and the City covenants especially that such money shall be continuously secured by a -valid pledge of direct obligations of, or obligations unconditionally guaranteed by.,.the United States of America, having a par value, or market value when less than par, exclusive of accrued interest, at all times at least equal to the total amount of money on deposit in the several Funds in the Depository. SECTION 15. Additional Bonds. In addition to the right to issue bonds of inferior lien as authorized by the laws of this State, the City of Georgetown reserve the right to issue additional bonds from time to time payable from the net income and revenues of the Utility System; and, when issued in compliance with law and the terms and conditions hereinafter appearing, such Additional Bonds shall be equally secured by a first lien on and pledge of the Pledged Revenues; and the Additional Bonds, when issued, shall be payable from the Utility System revenue Bonds Interest and Sinking Fund and shall be in all respects of equal dignity and on a parity with the Parity Bonds, PROVIDED that in each instance: (a) The Additional Bonds are authorized and issued in con- formity with the Constitution and applicable Statutes of the State of Texas; (b) The Bond Fund, ' the r1 eserve und, and the Contingency Fund contain the amount of money then required to be on deposit therein and the City is in compliance with all other covenants and undertakings in connection with all bonds then outstanding and payable from the net revenues of the Utility System; (c) The Net revenues of the Utility System for either the fiscal year or twelve month period next preceding the date of the passage of an ordinance authorizing the issuance of the Additional Bonds are certified by a Certified Public Accountant to have been at least equal to one and'one-half times the average annual principal and interest requirements on all bonds then outstanding against the Utility System and the bonds then to be issued; (d) A competent independent engineer certifies in writing that in his opinion the average annual net earnings throughout the life of ,the bonds then outstanding against the Utility System'and the bonds then to be issued shall be equal to at least one and one-half times the aver- age annual principal and interest requirements on all bonds then outstand- ing against the Utility System and the bonds then to be issued; (e) The ordinance authorizing the issuance of the Additional Bonds shall provide W for an identical FLOW OF FUINIDS as prescribed by Section 13 of the ordinances authorizing the Parity Bonds; (ii) that all revenues deposited in the special funds and accounts created and established by such ordinances shall be commingled; and (iii) for appropriate additional or larger payments to be made into said special funds and accounts and for appropriate additional or larger amounts to be accumulated in said special funds and accounts for all bonds then outstanding against the Utility System and the proposed Additional Bonds, in full accord with the provisions of this ordinance. SECTION 16. Maintenance and Operation. The City hereby covenants and agrees to maintain the facilities of the Utility System in good con- dition and operate the same in an efficient manner and at a reasonable cost. So'long as any Parity Bonds are outstanding, the City covenants and agrees to maintain insurance for the benefit of the holder or holders of such bonds of the kinds and in the amounts which usually are carried by private companies operating similar properties, and that during such tine all policies of insurance shall be maintained in force and'dept current as to premium payments. All moneys received from losses under such insurance policies other than public liability policies, are hereby pledged as security for such bonds until and unless the proceeds are paid out in making good the loss or damage in respect of which such proceeds are received, either by replacing the property destroyed or repairing the property damaged, and adequate provision for making good such loss or da.age made within ninety (90) days after the date of'loss. The payment of premiums for all insurance policies required under the provisions hereof shall be considered as maintanance and operation expense. SECTION 17. ii,ecords and Accounts. The City hereby covenants and agrees that so iui__ ;_I_ any Parity Bonds, or any interest thereon, remain outstanding and unpaid, it will keep and maintain a proper and complete system of records and accounts pertaining to the operation of the Utility System, separate and apart from all other records and accounts, in which complete and correct entries shall be made of all transactions relating to said System as provided in Article 1113, Revised Civil Statutes of Texas, 1925, as amended, and that the holder or holders of any of the Parity Bonds, or any duly authorized agent or agents of such holders, shall have the right at all reason- able times to inspect all such records,aaccounts, and data relating thereto, and to inspect the System and all properties comprising same. The City further agrees that within sixty (60) days following the close of each fiscal year, it will cause an audit of such books and accounts to be made by an independent firm of Certified Public Accountants, showing the receipts and disbursements for account of the Utility System for the fiscal year, and each such audit, in addition to whatever other matters may be thought proper by the :accountant, shall particularly include the following: (a) A detailed statement of the income and expenditures for account of the Utility System for such fiscal year. (b) A balance sheet as of the end of such fiscal year. (c) The :accountant's comments regarding the manner in which the City has carried out the requirements of this ordinance and his recom- mendations for any changes or improvements in the operation, records and accounts of the Utility System. (d) A list of the insurance policies in force at the end of the fiscal year on the Utility System properties, setting out as to each policy the amount thereof, the risk covered, the name of the insurer, and the policy's expiration date. (e) A list of the securities which have been on deposit as security for the money in the Bond Fund, the Reserve Fund, and the Contingency Fund, throughout the fiscal year; a list of the securities, if any, in which the '.eserve Fund and the Contingency Fund have been invested, and -a statement of the manner in which money in the Utility System Revenue Fund has been secured in such fiscal year. M The number of P.,etered and unmetered customers connected with the various departments of the Utility System, showing totals as of the end of the year. Lxpenses incurred in making the audits above required are to be paid as maintanance and operation expenses. The City further agrees to promptly furnish a copy of each such audit to FIRST SOUT_TWEST COMPANY, DALI IS, TLY.AS, and to any holder of any of the Bonds who shall request samie in writing, and that the holder of any of the Bonds shall have the right to discuss with the accountant making the audit the contents of the audit and to ask for such additional information as he may reasonably request. SECTION 18. Sale, Lease or other Encumbrance of System. The City hereby covenants, binds and obligates itself not to sell, lease or in any manner dispose of the Utility System, or any part thereof, including any and all extensions and additions that may be made thereto, until all Bonds shall have been paid in full as to both principal and interest provided that this covenant shall not be construed to prevent the disposal by the City of property which in its judgment has become inexpedient to use in connection with the Utility System when other property of equal value has been substituted therefor). SECTION 19. Xo Cownetingir �vstem. That so far as it legally may, the City covenants and agrees, for the protection and security of the Bonds and the holders thereof from time to time that it will not grant a franchise for the operation of any competing waterworks, sewer and/or electric light system in the City of Georgetown, until all Bonds issued hereunder shall have been retired. SECTION 20. Remedies in Event of Default. In addition to all the rights and remedies provided by the laws of the State of ,Texas, the City covenants and agrees particularly that in. the event the City (a) defaults in the payment of principal of or interest on any Bonds wher. due, (b) fails to make the payments required by Section 13 of the ordinances authorizing the Parity Bonds to be made into the Bond Fund, Reserve Fund and Contingency Fund, or (c) defaults in the observance or performance of any other of the covenants, conditions or obligations set forth in this ordinance, the following remedies shall be available: (a) The holder or holders of any of the :fonds issued here- under shall be entitled to a writ of mandaY;ius issued by a court of proper jurisdiction compelling and requiring the City Council and other officers of the City to observe and perform any covenant, obligation or condition prescribed in this Bond Ordinance. (b) No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein, and every such right and power may be exercised from time to time and as often as may be deemed expedient. The specific remedies herein provided shall be cumulative of all other existing remedies and the specification of such remedies shall not be deemed to be exclusive. SECTION 21. Special Covenants and uundl-LiuiL (a) The City will duly and punctually keep, observe and perform each and every term, covenant and condition on its part to be kept, observed and performed, contained in this ordinance, and will punctually perform all duties with reference to the Utility System required by the Constitution and laws of the State of Texas, including particularly the making and collecting of such reasonable and sufficient rates and charges for services supplied by the Utility System to the City and to all other customers, adjusting such rates and charges from time to time in such manner as will be fully sufficient to meet all the requirements of the.ordinances authorizing the Parity Bonds, and the proper segregation and application of the revenues of such System; (b) The City is duly authorized under the laws of the State of Texas to issue the Bonds and to pledge the revenues pledged here- under, and all necessary action on the part of the City and its City Council for the issuance of the Bonds have been duly and effectively ta<ien, and that the Bonds in the hands of the holders thereof are and will be valid and enforceable oblin-ations of the City in accordance with their terms; (c) That the Bonds authorized hereunder shall be special obligations of the City and the holder thereof shall never have the ri�`it to demand payment out of funds raised or to be raised by taxation; (d) That other than for the parent of the Bonds, the outstanding "City of Georgetown Utility System }�evenu'e Bonds, Series 1964," dated June 1, 1964, and the outstanding "City of Georgetown Utility System .LLevenue Bonds, Series 1966," dated June 1, 1966, the rents, revenues and income of the Utility System have riot been pledged in any manner to the payment of any debts or obligations of the City nor of said Systeia; and (e) That the Utility System of the City is free and clear of all encumbrances. SECTION 22. Ordinance to Constitute �..ontract. That the pro- visions of this ordinance shall constitute a contract between the City and the holder or holders from time to time of. the Bonds, and after the issuance of any of said Bonds, .no change, variation or alteration of any kind of the provisions of this ordinance may be made, unless as herein otherwise provided, until all of the Bonds shall have been paid as to both principal and interest. SECTION 23. Approval and Rezistration of Bonds. That the Bonds and a complete record of proceedings shall be submitted to the Attorney General, they shall- be left in the care and custody of the Comptroller of Public Accounts, and the State Comptroller is hereby authorized to deliver the Bonds, after registration thereof, to The American National Lank of Austin, Austin, Texas, SECTION 24. Confirmation of Sale. That the sale of the Bonds to FIRST SOUTIE-VEST CONPANY, DALLAS, TEXAS, at a price of par and accrued interest to date of delivery, plus a cash premium of $12.50, is hereby confirmed. Delivery of the Bonds to said purchaser shall be made as soon as may be after the passage of this ordinance, upon pay- ment therefor in accordance with the terms of sale. SECTION 25. IT IS HEREBY CERTIFIED and RECITED by the City Council: (a) That the City is in compliance with all covenants and undertakings in connection with the Outstanding Bonds; and (b) That in issuing the Bonds, the City has complied with all the requirements pertaining to the issuance of additional parity bonds as set forth in the ordinances authorizing the issuance of the Outstanding Bonds. SECTION 26. E�mer;::ency. The fact that the City Council considers the passage of this ordinance and the issuance of the Bonds necessary for the preservation of the public health and safety of the citizens of the City of Geor(retown, it is hereby declared to be an emergency measure demanding that the rule requiring ordinances to be read at more than one meeting of the City Council be suspended and that this ordinance take effect immediately from: and after its passage, and it is so ordained. P.1.SSED AND APPROVED at a Meeting open to the public this the 13th day of October , 1967. ATTEST: Claud Eads, City Secretary. TIC; STATE OF TEXAS COUNTY OF WILLIA1 SON CITY OF GEORGETOVPN Jay C. Sloan, Mayor City of Georgetown, Texas I, the undersigned, City Secretary of the City of Georgetown, Texas, DO IITi�Ii,EBY CMUTIFY that the foregoing is a true and correct copy of an ORDINANCE passed by the City Council of said City on the 25tL day of September , 1967, and of the Minutes pertain- ing to its passage, as said Ordinance appears of record in Ordinance Book II Page 78-89. Vv'ITNESS MY HAND and the seal of the City of Georgetown, Texas, this the 13th day of October, 1967. SEAL Claud Eads, City Secretary Cit,= of Georgetown, Texas