ORD 901 06/09/2009 DRAFT DATE: MAY 29,2009
ORDINANCE NO. g�1-
ORDINANCE AUTHORIZING THE ISSUANCE,SALE AND DELIVERY OF
$ IN AGGREGATE PRINCIPAL AMOUNT OF "CITY OF
CIBOLO, TEXAS GENERAL OBLIGATION BONDS, SERIES 2009";
SECURING THE PAYMENT THEREOF BY AUTHORIZING FHE LEVY OF
AN ANNUAL AD VALOREM TAX; AND APPROVING AND
AUTHORIZING THE EXECUTION OF A PAYING AGENT/REGISTRAR
AGREEMENT,A PURCHASE CONTRACT,AN OFFICIAL STATEMENT
AND ALL OTHER INSTRUMENTS AND PROCEDURES RELATED
THERETO
DATE OF APPROVAL:JUNE 9,2009
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TABLE OF CONTENTS
Recitals 1
Section 1. AMOUNT AND PURPOSE OF THE BONDS 2
Section 2. DESIGNATION,DATE, DENOMINATIONS,NUMBERS,AND
MATURITIES OF THE BONDS 2
Section 3. INTEREST 3
Section 4. CHARACTERISTICS OF THE BONDS 4
Section 5. FORM OF BONDS 7
Section 6. INTEREST AND SINKING FUND; TAX LEVY 15
Section 7. CONSTRUCTION FUND 16
Section 8. INVESTMENTS 16
Section 9. DEFEASANCE OF BONDS 17
Section 10. DAMAGED,MUTILATED,LOST, STOLEN, OR DESTROYED BONDS 18
Section 11. CUSTODY,APPROVAL,AND REGISTRATION OF BONDS;
BOND COUNSEL'S OPINION; CUSIP NUMBERS; AND
OTHER MATTERS 19
Section 12. COVENANTS REGARDING TAX-EXEMPTION OF INTEREST
ON THE BONDS 19
Section 13. SALE AND DELIVERY OF BONDS 22
Section 14. APPROVAL OF OFFICIAL STATEMENT 23
Section 15. MUNICIPAL BOND INSURANCE POLICY 23
Section 16. AUTHORITY FOR OFFICERS TO EXECUTE DOCUMENTS
AND APPROVE CHANGES 23
Section 17. ORDINANCE A CONTRACT;AMENDMENTS 24
Section 18. INTERESTED PARTIES 24
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Section 19. COMPLIANCE WITH RULE 15c2-12 24
Section 20. SECURITY INTEREST 27
Section 21. REMEDIES IN EVENT OF DEFAULT 27
Section 22. INCORPORATION OF RECITALS 28.
Section 23. SEVERABILITY 28
Section 24. EFFECTIVE DATE 28
SIGNATURES
PAYING AGENT/REGISTRAR AGREEMENT Exhibit A
PURCHASE CONTRACT Exhibit B
REQUIREMENTS OF THE INSURER WITH RESPECT TO THE
MUNICIPAL BOND INSURANCE POLICY Exhibit C
DESCRIPTION OF ANNUAL FINANCIAL INFORMATION Exhibit D
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ORDINANCE NO.
ORDINANCE AUTHORIZING THE ISSUANCE,SALE AND DELIVERY OF
$ IN AGGREGATE PRINCIPAL AMOUNT OF "CITY OF
CIBOLO, TEXAS GENERAL OBLIGATION BONDS, SERIES 2009";
SECURING THE PAYMENT THEREOF BY AUTHORIZING THE LEVY OF
AN ANNUAL AD VALOREM TAX; AND APPROVING AND
AUTHORIZING THE EXECUTION OF A PAYING AGENT/REGISTRAR
AGREEMENT,A PURCHASE CONTRACT,AN OFFICIAL STATEMENT
AND ALL OTHER INSTRUMENTS AND PROCEDURES RELATED
THERETO
THE STATE OF TEXAS §
COUNTY OF CAMERON §
CITY OF CIBOLO §
WHEREAS, the CITY OF CIBOLO,TEXAS(the "City") in Guadalupe County, Texas, is a
political subdivision of the State of Texas operating as a home-rule city pursuant to the Texas Local
Government Code and its City Charter which was initially approved by the qualified voters of the
City on September 11, 2004; and
WHEREAS, at an election held on November 4, 2008, the qualified voters of the City
approved the issuance of general obligation bonds for certain purposes,and the City Council deems
it necessary and advisable to issue and deliver pursuant to this Ordinance$10,750,000 in principal
amount of general obligation bonds pursuant to such voted authorization(which will constitute the
first installment of general obligations bonds approved at such election), all pursuant to Chapters
1251 and 1331, Texas Government Code, as amended, and other applicable laws of the State of
Texas, and as further specified below:
BONDS
BONDS ISSUED BONDS
DATE AMOUNT - PREVIOUSLY THIS AUTHORIZED
VOTED PURPOSE VOTED `ISSUED" SERIES BUT UNISSUED
11/04/08 Public Safety Improvements $6,400,000 -0- $6,400,000 -0-
11/04/08 Streets and Related Drainage 4,200,000 -0- 4,200,000 -0-
11/04/08 Drainage Improvements 9,200,000 -0- 150,000 9,050,000
11/04/08 Athletic Field Improvements 3,300,000 -0- -0- 3,300,000
11/04/08 Recreation Center 4,800,000 -0- -0- 4,800,000
TOTAL *** $27,950,000 -0- $10,750,000 $17,200,000
WHEREAS, the City Council of the City hereby finds and declares a public purpose and
deems it advisable and in the best interests of the City to issue a series of bonds(defined in Section 2
hereof as the "Bonds"), the proceeds from which will be used to pay costs of issuance and make
public safety improvements,street improvements and drainage improvements pursuant to the voted
authorization described above; and
WHEREAS,the Bonds hereinafter authorized and designated are to be issued and delivered
pursuant to Chapters 1251 and 1331, Texas Government Code; and
WHEREAS, it is hereby officially found and determined that the meeting at which this
Ordinance was passed was open to the public, and public notice of the time,place, and purpose of
said meeting was given, all as required by Chapter 551,Texas Government Code.
THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
CIBOLO, TEXAS:
SECTION 1. AMOUNT AND PURPOSE OF THE BONDS. General obligation bonds of
the City are hereby authorized to be issued and delivered in the aggregate principal amount of
$ FOR THE PURPOSE OF PROVIDING FUNDS TO FINANCE THE
CONSTRUCTION OF PUBLIC SAFETY IMPROVEMENTS, STREET IMPROVEMENTS,
AND DRAINAGE IMPROVEMENTS,AND TO PAY FOR COSTS OF ISSUANCE.
SECTION 2. DESIGNATION, DATE, DENOMINATIONS, NUMBERS AND
MATURITIES OF BONDS. (a) Each Bond issued pursuant to this Ordinance shall be designated:
"CITY OF CIBOLO,TEXAS GENERAL OBLIGATION BOND,SERIES 2009"(a"Bond"and collectively,
the "Bonds") and initially there shall be issued, sold and delivered hereunder one fully registered
bond,without interest coupons,dated as of June 1,2009,with Bonds issued in replacement thereof
being in the denomination of$5,000 or any integral multiple thereof, and with Bonds issued and
delivered in substitution for the Initial Bond being numbered consecutively from R-1 upward, all
payable to the initial registered owner thereof(with the Initial Bond being payable to the initial
purchaser designated in Section 13 hereof), or to the registered assignee or assignees of said bond
or any portion or portions thereof(in each case,the "Registered Owner").
[The remainder of this page intentionally left blank]
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(b) The Bonds shall mature on February 1 in each of the years and in the respective principal
amounts as set forth below:
YEAR OF PRINCIPAL YEAR OF PRINCIPAL
MATURITY AMOUNT($) MATURITY AMOUNT($)
2010 2020
2011 2021
2012 2022
2013 2023
2014 2024
2015 2025
2016 2026
2017 2027
2018 2028
7019 7079
SECTION 3. INTEREST. (a) The Bonds shall bear interest calculated on the basis of a 360-
day year composed of twelve 30-day months from the dates specified in the FORM OF BONDS set
forth in this Ordinance to their respective dates of maturity or prior redemption at the rates per
annum as set forth below:
YEAR OF , INTEREST YEAR OF INTEREST
MATURITY RATE(%) MATURITY RATE(%)
2010 2020
2011 2021
2012 2022
2013 2023
2014 2024
2015 2025
2016 2026
2017 2027
2018 2028
7019 7079
Said interest shall be payable in the manner provided and on the dates stated in the FORM OF
BONDS set forth in this Ordinance.
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SECTION 4. CHARACTERISTICS OF THE BONDS. (a) Registration. Transfer. and
Exchange:Authentication. The City shall keep or cause to be kept at the designated corporate trust
or commercial banking office (initially located in Austin, Texas) of WELLS FARGO BANK,
NATIONAL ASSOCIATION (the "Paying Agent/Registrar")books or records for the registration of
the transfer and exchange of the Bonds(the"Registration Books"),and the City hereby appoints the
Paying Agent/Registrar as its registrar and transfer agent to keep such books or records and make
such registrations of transfers and exchanges under such reasonable regulations as the City and
Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such regis-
trations,transfers and exchanges as herein provided. Attached hereto as Exhibit A is a copy of the
Paying Agent/Registrar Agreement between the City and the Paying Agent/Registrar which is
hereby approved in substantially final form,and the Mayor,Mayor Pro-Tern and City Secretary of
the City are hereby authorized to execute the Paying Agent/Registrar Agreement and approve any
changes in the final form thereof.
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 City 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 exchanges 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 representative of the Paying Agent/Registrar
shall, before the delivery of any such Bond, date and manually sign the Paying Agent/Registrar'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 City 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 Subchapter D
of Chapter 1201,Texas Government Code,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
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Ordinance, approved by the Attorney General, and registered by the Comptroller of Public Ac-
counts.
(b) Payment of Bonds and Interest. The City hereby further appoints the Paying
Agent/Registrar to act as the paying agent for paying the principal of 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 City and the Paying Agent/Registrar with respect to the Bonds.
(c) In General. The Bonds (i) shall be issued in fully registered form, without interest
coupons,with the principal of and interest on such Bonds to be payable only to the 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 City at least 50 days prior to any such redemption date),(iii)may
be transferred and assigned, (iv)may be exchanged for other Bonds, (v) shall have the character-
istics, (vi) shall be signed, sealed, executed and authenticated, (vii)the principal of and interest on
the Bonds shall be payable,and(viii)shall be administered and the Paying Agent/Registrar and the
City shall have certain duties and responsibilities with respect to the Bonds, all as provided, and in
the manner and to the effect as required or indicated, in the FORM OF BOND set forth in this
Ordinance. The Initial Bond is not required to be, and shall not be, authenticated by the Paying
Agent/Registrar,but on each substitute Bond issued in exchange for the Initial Bond 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. In lieu of the
executed Paying Agent/Registrar's Authentication Certificate described above, the Initial Bond
delivered on the closing date (as further described in subparagraph(i)below) shall have attached
thereto the Comptroller's Registration Certificate substantially in the form set forth in the FORM OF
BOND below,manually executed by the Comptroller of Public Accounts of the State of Texas or
by his duly authorized agent,which certificate shall be evidence that the Initial Bond has been duly
approved by the Attorney General of the State of Texas and that it is a valid and binding obligation
of the City, and has been registered by the Comptroller.
(d) Substitute Paying Agent/Registrar. The City covenants with the registered owners of
the Bonds that at all times while the Bonds are outstanding the City will provide a competent and
legally qualified bank,trust company,financial institution,or other entity 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 and shall be an entity registered with the Securities and Exchange
Commission. The City reserves the right to, and may, at its option, change the Paying
Agent/Registrar upon not less than 120 days written notice to the Paying Agent/Registrar, to be
effective not later than 60 days prior to the next principal or interest payment date after such notice.
In the event that the entity at any time acting as Paying Agent/Registrar(or its successor by merger,
acquisition,or other method)should resign or otherwise cease to act as such,the City covenants that
promptly it will appoint a competent and legally qualified 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/Registrar promptly shall transfer and deliver the
Registration Books(or a copy thereof), along with all other pertinent books and records relating to
the Bonds, to the new Paying Agent/Registrar designated and appointed by the City. Upon any
change in the Paying Agent/Registrar, the City 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
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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 provisions of this Ordinance, and a certified copy of this
Ordinance shall be delivered to each Paying Agent/Registrar.
(e) Book-Entry Only System for Bonds. The Bonds issued in exchange for the Bonds
initially issued to the purchaser specified in Section 13 herein shall be initially issued in the form
of a separate single fully registered Bond for each of the maturities thereof. Upon initial issuance,
the ownership of each such Bond shall be registered in the name of Cede&Co.,as nominee of The
Depository Trust Company of New York("DTC"),and except as provided in subsection(i)hereof,
all of the outstanding Bonds shall be registered in the name of Cede&Co., as nominee of DTC.
With respect to Bonds registered in the name of Cede&Co., as nominee of DTC,the City
and the Paying Agent/Registrar shall have no responsibility or obligation to any securities brokers
and dealers,banks,trust companies,clearing corporations and certain other organizations on whose
behalf DTC was created ("DTC Participant") to hold securities to facilitate the clearance and
settlement of securities transaction among DTC Participants or to any person on behalf of whom
such a DTC Participant holds an interest in the Bonds. Without limiting the immediately preceding
sentence, the City and the Paying Agent/Registrar shall have no responsibility or obligation with
respect to(i)the accuracy of the records of DTC, Cede&Co. or any DTC Participant with respect
to any ownership interest in the Bonds,(ii)the delivery to any DTC Participant or any other person,
other than a registered owner of the Bonds,as shown on the Registration Books,of any notice with
respect to the Bonds, or(iii)the payment to any DTC Participant or any other person, other than a
registered owner of Bonds, as shown in the Registration Books of any amount with respect to
principal of or interest on the Bonds. Notwithstanding any other provision of this Ordinance to the
contrary,the City and the Paying Agent/Registrar shall be entitled to treat and consider the person
in whose name each Bond is registered in the Registration Books as the absolute owner of such
Bond for the purpose of payment of principal and interest with respect to such Bond,for the purpose
of registering transfers with respect to such Bond, and for all other purposes whatsoever. The
Paying Agent/Registrar shall pay all principal of and interest on the Bonds only to or upon the
Ordinance of the registered owners, as shown in the Registration Books as provided in this
Ordinance, or their respective attorneys duly authorized in writing, and all such payments shall be
valid and effective to fully satisfy and discharge the City's obligations with respect to payment of
principal of and interest on the Bonds to the extent of the sum or sums so paid. No person other than
a registered owner,as shown in the Registration Books, shall receive a Bond certificate evidencing
the obligation of the City to make payments of principal and interest pursuant to this Ordinance.
Upon delivery by DTC to the Paying Agent/Registrar of written notice to the effect that DTC has
determined to substitute a new nominee in place of Cede&Co.,and subject to the provisions in this
Ordinance with respect to interest checks being mailed to the registered owner at the close of
business on the Record Date, the words "Cede & Co." in this Ordinance shall refer to such new
nominee of DTC.
(f) Successor Securities Depository: Transfers Outside Book-Entry Only Systems. In the
event that the City determines that DTC is incapable of discharging its responsibilities described
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herein and in the representation letter of the City to DTC or that it is in the best interest of the
beneficial owners of the Bonds that they be able to obtain certificated Bonds, the City shall (i)
appoint a successor securities depository, qualified to act as such under Section 17(a) of the
Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants of the
appointment of such successor securities depository and transfer one or more separate Bonds to such
successor securities depository or(ii)notify DTC and DTC Participants of the availability through
DTC of Bonds and transfer one or more separate Bonds to DTC Participants having Bonds credited
to their DTC accounts. In such event,the Bonds shall no longer be restricted to being registered in
the Registration Books in the name of Cede&Co.,as nominee of DTC,but may be registered in the
name of the successor securities depository,or its nominee,or in whatever name or names registered
owners transferring or exchanging Bonds shall designate,in accordance with the provisions of this
Ordinance.
(g) Payments.to Cede& Co. Notwithstanding any other provision of this Ordinance to the
contrary, so long as any Bond is registered in the name of Cede & Co., as nominee for DTC, all
payments with respect to principal of and interest on such Bond and all notices with respect to such
Bond shall be made and given,respectively, in the manner provided in the representation letter of
the City to DTC.
(h) DTC Letter of Representation. The officers of the City are herein authorized for and on
behalf of the City and as officers of the City to enter into one or more Letters of Representation,if
necessary,with DTC establishing the book-entry only system with respect to the Bonds.
(i) Delivery of Initial Bond. On the closing date, one Initial Bond representing the entire
principal amount of the Bonds and, payable in stated installments to the initial registered owner
named in Section 13 of this Ordinance or its designee, executed by manual or facsimile signature
of the Mayor or Mayor Pro-Tem and City Secretary of the City,approved by the Attorney General
of Texas,and registered and manually signed by the Comptroller of Public Accounts of the State of
Texas,will be delivered to the initial purchaser or its designee. Upon payment for the Bonds, the
Paying Agent/Registrar shall cancel the Initial Bond and deliver to the initial registered owner or
its designee one registered definitive Bond for each year of maturity of the Bonds,in the aggregate
principal amount of all of the Bonds for such maturity.
SECTION 5. FORM OF BONDS. The form of the Bonds, including the form of Paying
Agent/Registrar's Authentication Certificate,the form of Assignment and the form of Registration
Certificate of the Comptroller of Public Accounts of the State of Texas (to be attached only 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.
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FORM OF BOND
R-1 UNITED STATES OF AMERICA PRINCIPAL
STATE OF TEXAS AMOUNT
COUNTY OF GUADALUPE
CITY OF CIBOLO,TEXAS S
GENERAL OBLIGATION BOND, SERIES 2009
INTEREST RATE DATE OF SERIES MATURITY DATE CUSIP NO.
June 1,2009
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
ON THE MATURITYDATE specified above,the CITY OF CIBOLO,TEXAS(the"City"),
being a political subdivision and home-rule municipality 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 June 1,2009,at the
Interest Rate per annum specified above,on February 1,2010,and semiannually on each August 1
and February 1 thereafter to the Maturity Date specified above or date of redemption prior to
redemption;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; provided, 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 or converted from 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 redemption prior to maturity, at the designated corporate trust or commercial banking
office(initially located in Austin,Texas)of WELLS FARGO BANK,NATIONAL ASSOCIATION,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 or draft,dated as of such interest payment date,drawn by the Paying Agent/Registrar on,and
payable solely from, funds of the City required by the ordinance authorizing the issuance of the
Bonds(the "Bond Ordinance")to be on deposit with the Paying Agent/Registrar for such purpose
as hereinafter provided; and such check or draft shall be sent by the Paying 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 last business 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
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Paying Agent/Registrar,requested by,and at the risk and expense of,the Registered Owner. In the
event of a non-payment of interest on a scheduled payment date, and for 30 days thereafter, a new
record date for such interest payment(a "Special Record Date")will be established by the Paying
Agent/Registrar, if and when funds for the payment of such interest have been received from the
City. Notice of the Special Record Date and of the scheduled payment date of the past due interest
(which shall be 15 days after the Special Record Date)shall be sent at least five business days prior
to the Special Record Date by United States mail,first-class postage prepaid,to the address of each
owner of a Bond appearing on the Registration Books at the close of business on the last business
day next preceding the date of mailing of such notice. Any accrued interest due upon the
redemption of this Bond prior to maturity as provided herein shall be paid to the Registered Owner
upon presentation and surrender of this Bond for redemption and payment to the Paying
Agent/Registrar at the Designated Trust Office(unless the redemption date is a regularly scheduled
interest payment date, in which case accrued interest on such redeemed Bonds shall be payable in
the regular manner described above). The City covenants with the Registered Owner of this Bond
that on or before each principal payment date and interest payment date for this Bond it will make
available to the Paying Agent/Registrar,from the"Interest 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 ANY PAYMENT DUE on this Bond shall be a Saturday, Sunday, a
legal holiday, or a day on which banking institutions in the city where the Designated Trust Office
of the Paying Agent/Registrar is located are authorized by law or executive order to close,then the
date for such payment shall be the next succeeding day which is not such a Saturday, Sunday,legal
holiday,or day on which banking institutions are authorized to close,and payment on such date shall
have the same force and effect as if made on the original date payment was due.
THIS BOND IS ONE OF A SERIES OF BONDS dated as of June 1, 2009, authorized in
accordance with the Constitution and laws of the State of Texas in the principal amount of
$ FOR THE PURPOSE OF PROVIDING FUNDS TO FINANCE THE
CONSTRUCTION OF PUBLIC SAFETY IMPROVEMENTS, STREET IMPROVEMENTS,
AND DRAINAGE IMPROVEMENTS,AND TO PAY FOR COSTS OF ISSUANCE.
ONFEBRUARY1,2019,OR ONANY DATE THEREAFTER,the Bonds maturing on and
after February 1, 2020, may be redeemed prior to their scheduled maturities, at the option of the
City,with funds derived from any available and lawful source,as a whole,or in part(provided that
a portion of such Bond may be redeemed only in an integral multiple of$5,000 in principal amount)
at the redemption price equal to the principal amount being called for redemption plus unpaid
accrued interest. If less than all of such Bonds are to be redeemed, the particular Bonds to be
redeemed shall be selected by the Paying Agent/Registrar at random and by lot.
ADDITIONALLY, THE BONDS MATURING on February 1 in the years 20_,20_and
20_(the"Term Bonds") are subject to mandatory redemption prior to maturity in part by lot, at a
price equal to the principal amount thereof plus accrued interest to the date of redemption, on the
dates and in the respective principal amounts shown below:
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TERM BONDS MATURING TERM BONDS MATURING
FEBRUARY 1,20 FEBRUARY 1,20
Mandatory Redemption Mandatory Redemption
Redemption Date Amount Redemption Date Amount
February 1, 20_ February 1, 20_
February 1, 20_ February 1, 20_
February 1, 20_(maturity) February 1, 20 (maturity)
TERM BONDS MATURING
FEBRUARY 1,20
Mandatory Redemption
Redemption Date Amount
February 1, 20_ $
February 1, 20_
February 1,20_(maturity)
The principal amount of the Term Bonds required to be redeemed pursuant to the operation of such
mandatory redemption requirements may be reduced, at the option of the Issuer, by the principal
amount of any such Term Bonds which,prior to the date of the mailing of notice of such mandatory
redemption,(i) shall have been acquired by the Issuer and delivered to the Paying Agent/Registrar
for cancellation, (ii) shall have been purchased and canceled by the Paying Agent/Registrar at the
request of the Issuer, or (iii) shall have been redeemed pursuant to the optional redemption
provisions described in the preceding paragraph and not theretofore credited against a mandatory
redemption requirement.
AT LEAST 30 DAYS PRIOR to the date fixed for any redemption of Bonds or portions
thereof prior to maturity, a written notice of such redemption 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 Registration Books maintained by the Paying Agent/Registrar on the day such
notice of redemption is mailed. Any notice of redemption so mailed shall be conclusively presumed
to have been duly given irrespective of whether received by the Registered Owner. 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 portions thereof which are to be so
redeemed. If such written notice of redemption is mailed 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
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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 City, 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 may, at the request of the Registered Owner or the assignee or assignees
hereof,be assigned,transferred,converted into and exchanged for a like aggregate amount of fully
registered Bonds,without interest coupons,payable to the appropriate Registered Owner,assignee
or assignees,as the case maybe,having any authorized denomination or denominations as requested
in writing by the appropriate Registered Owner,assignee or assignees,as the case may be,upon sur-
render of this Bond to the Paying Agent/Registrar for cancellation, 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 signatures satisfactory to the
Paying Agent/Registrar,evidencing assignment of this Bond or any portion or portions hereof in any
authorized denomination to the assignee or assignees in whose name or names this Bond or 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 Registered Owner to evidence the assignment hereof,but such
method is not exclusive, and other instruments of assignment satisfactory to the Paying
Agent/Registrar may be used to evidence the assignment of this Bond or any portion or portions
hereof from time to time by the Registered Owner. The Paying Agent/Registrar's reasonable
standard or customary fees and charges for assigning,transferring,converting and exchanging any
Bond or portion thereof will be paid by the City. In any circumstance, any taxes or governmental
charges required to be paid with respect thereto shall be paid by the one requesting such assignment,
transfer, conversion or exchange, as a condition precedent to the exercise of such privilege. The
Paying Agent/Registrar shall not be required to make any such transfer or exchange of a Bond(i)
during the period commencing with the close of business on any Record Date immediately preceding
a principal or interest payment date for such Bond 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;provided,
however,such limitation of transfer shall not be applicable to an exchange by the Registered Owner
of an unredeemed balance of a Bond called for redemption in part.
IN THE EVENT ANY PAYING AGENT/REGISTRAR for the Bonds is changed by the
City,resigns,or otherwise ceases to act as such,the City has covenanted in the Bond Ordinance that
it promptly will appoint a competent and legally qualified substitute therefor, and cause written
notice thereof to be mailed to the registered owners of the Bonds.
ITIS HEREBY CERTIFIED,RECITED,AND COVENANTED that this Bond has been
duly and validly authorized, issued, and delivered; 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
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is a general obligation of the City, 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 City,and have been pledged for such payment,within the limits provided
by law.
THE CITY HAS RESERVED THE RIGHT TO AMEND the Bond Ordinance as provided
therein, and under some (but not all) circumstances amendments thereto must be approved by the
registered owners of a majority in aggregate principal amount of the outstanding Bonds.
BY BECOMING THE REGISTERED OWNER of this Bond,the Registered Owner thereby
acknowledges all of the terms and provisions 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 City,and agrees that the
terms and provisions of this Bond and the Bond Ordinance constitute a contract between each
Registered Owner hereof and the City.
[The remainder of this page intentionally left blank]
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IN WITNESS WHEREOF,the City has caused this Bond to be signed with the manual or
facsimile signature of the Mayor or Mayor Pro-Tem of the City and countersigned with the manual
or facsimile signature of the City Secretary of the City, and has caused the official seal of the City
to be duly impressed, or placed in facsimile, on this Bond.
(facsimile signature) (facsimile signature)
City Secretary, City of Cibolo, Texas Mayor [Pro-Tem], City of Cibolo,
Texas
(SEAL)
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, certified 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
(COMPTROLLER'S SEAL) of the State of Texas
FORM OF STATEMENT RELATING TO BOND INSURANCE
STATEMENT RELATING TO BOND INSURANCE
[To come if municipal bond insurance is obtained]
[The remainder of this page intentionally left blank]
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FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
(To be executed if this Bond is not accompanied by an executed Registration Certificate of
the Comptroller of Public Accounts of the State of Texas)
It is hereby certified that this Bond has been issued under the provisions of the Bond
Ordinance described in the text of this Bond; and that this Bond has been issued in conversion or
replacement of,or 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 WELLS FARGO BANK,NATIONAL ASSOCIATION
Austin, Texas
Paying Agent/Registrar
By
Authorized Representative
FORM OF ASSIGNMENT:
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned Registered Owner of this Bond, or duly authorized
representative or attorney thereof, hereby assigns this Bond to
(Assignee's Social Security or (Print or typewrite Assignee's name and address,including zip code)
Taxpayer Identification)
and hereby irrevocably constitutes and appoints
attorney to register the transfer of the within Bond on the books kept for registration thereof,with
full power of substitution in the premises.
Dated:
Signature Guaranteed:
NOTICE:Signature(s)must be guaranteed by NOTICE: The signature above must
a member firm of the New York Stock correspond with the name of the Registered
Exchange or a commercial bank or trust Owner as it appears upon the front of this
company. Bond in every particular,without alteration or
enlargement or any change whatsoever.
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INITIAL BOND INSERTIONS
The Initial Bond shall be in the form set forth above except that:
(A) Immediately under the name of the Bond, the headings "INTEREST RATE" and
"MATURITY DATE" shall be completed with the words "As shown below" and
"CUSIP NO. " shall be deleted.
(B) The first paragraph shall be deleted and the following shall be inserted:
"ON THE RESPECTIVE MATURITY DATES specified below,the CITY OF CIBOLO,
TEXAS(the"City"),being a political subdivision and home-rule municipality of the State of Texas,
hereby promises to pay to the Registered Owner specified above,or registered assigns(hereinafter
called the "Registered Owner"),the respective Principal Installments specified below, and to pay
interest thereon(calculated on the basis of a 360-day year composed of twelve 30-day months)from
June 1, 2009 at the respective Interest Rates per annum specified below, payable on
February 1, 2010, and semiannually on each August 1 and February 1 thereafter to the respective
Maturity Dates specified below,or the date of redemption prior to maturity. The respective Maturity
Dates,Principal Installments and Interest Rates for this Bond are set forth in the following schedule:
MATURITY DATE PRINCIPAL INTEREST
(FEBRUARY 1), INSTALLMENT RATE
[Insert information from Sections 2 and 3 above]
(C) The Initial Bond shall be numbered "T-1."
SECTION 6. INTEREST AND SINKING FUND; TAX LEVY. A special "Interest and
Sinking Fund" is hereby created and shall be established and maintained by the City at an official
depository bank of the City. Said Interest and Sinking Fund shall be kept separate and apart from
all other funds and accounts of the City, and shall be used only for paying the interest on and the
principal of said Bonds. Immediately after the issuance and delivery of the Bonds, all accrued
interest on the Bonds, together with any premium on the Bonds that is not used by the City to pay
costs of issuance in accordance with the provisions of Section 1201.042(d), Texas Government
Code,as amended, shall be deposited to the credit of the Interest and Sinking Fund. In addition,all
ad valorem taxes levied and collected for and on account of said Bonds shall be deposited, as
collected, to the credit of said Interest and Sinking Fund. For each fiscal year while any of the
Bonds or interest thereon are outstanding and unpaid,the governing body of the City shall compute
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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 interest comes due, and to provide and
maintain a sinking fund adequate to pay the principal of the Bonds as such principal matures (but
never less than 2% of the original principal amount of the Bonds as a sinking fund each year); and
said tax shall be based on the latest approved tax rolls of the City,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 City 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 deposited to the credit of the Interest and Sinking Fund
created by this Ordinance. 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. CONSTRUCTION FUND. There is hereby created and established in the
depository of the City, a fund to be called the City of Cibolo, Texas General Obligation Bonds
(Series 2009) Construction Fund(herein called the"Construction Fund"). Proceeds from the sale
and delivery of the Bonds(other than proceeds representing accrued interest on the Bonds and any
premium on the Bonds that is not used by the City to pay costs of issuance in accordance with the
provisions of Section 1201.042(d),Texas Government Code,as amended,which shall be deposited
in the Interest and Sinking Fund) shall be deposited in the Construction Fund. Money in the
Construction Fund shall be subject to disbursements by the City for payment of all costs incurred
in carrying out the purpose for which the Bonds are issued, including but not limited to costs for
construction, engineering, architecture, financing, fmancial consultants and legal services related
to the project being financed with proceeds of the Bonds,and to pay costs of issuance of the Bonds.
All funds remaining on deposit in the Construction Fund upon completion of the projects being
financed with the proceeds from the Bonds, if any, shall be transferred to the Interest and Sinking
Fund.
SECTION 8. INVESTMENTS. Funds on deposit in the Interest and Sinking Fund and the
Construction Fund shall be secured by the depository bank of the City in the manner and to the
extent required by law to secure other public funds of the City and may be invested from time to
time in any investment authorized by applicable law,including but not limited to the Public Funds
Investment Act(Chapter 2256,Texas Government Code),and the City's investment policy adopted
in accordance with the provisions of the Public Funds Investment Act; provided, however, that
investments purchased for and held in each Interest and Sinking Fund shall have a final maturity no
later than the next principal or interest payment date on which such funds will be needed, and
investments purchased for and held in the Construction Fund shall have a final maturity of not later
than the date the City reasonably expects the funds from such investments will be required to pay
costs of the projects for which the Bonds were issued. Income and profits from such investments
shall be deposited in the respective Fund which holds such investments;however,any such income
and profits from investments in the Construction Fund may be withdrawn by the City and deposited
in the Interest and Sinking Fund to pay all or a portion of the interest next coming due on the Bonds.
It is further provided, however, that any interest earnings on proceeds which are required to be
rebated to the United States of America pursuant to Section 12 hereof in order to prevent the Bonds
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from being arbitrage bonds shall be so rebated and not considered as interest earnings for the
purposes of this Section.
SECTION 9. 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,when payment of the
principal of such Bond,plus interest thereon to the due date(whether such due date be by reason of
maturity or otherwise)either(i)shall have been made or caused to be made in accordance with the
terms thereof, 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 in accordance with an escrow
agreement or other instrument (the "Future Escrow Agreement") for such payment (1) lawful
money of the United States of America sufficient to make such payment or(2)Defeasance Securities
that mature as to principal and interest in such amounts and at such times as will insure the
availability, without reinvestment, of sufficient money to provide for such payment, and when
proper arrangements have been made by the City 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 or
revenues herein levied and pledged as provided in this Ordinance, and such principal and interest
shall be payable solely from such money or Defeasance Securities. Notwithstanding any other
provision of this Ordinance to the contrary, it is hereby provided that any determination not to
redeem Defeased Bonds that is made in conjunction with the payment arrangements specified in
subsection(a)(i)or(ii)of this Section shall not be irrevocable,provided that: (1)in the proceedings
providing for such payment arrangements,the City expressly reserves the right to call the Defeased
Bonds for redemption;(2)gives notice of the reservation of that right to the owners of the Defeased
Bonds immediately following the making of the payment arrangements; and(3)directs that notice
of the reservation be included in any redemption notices that it authorizes.
(b) Any moneys so deposited with the Paying Agent/Registrar may at the written
direction of the City be invested in Defeasance Securities, maturing in the amounts and times as
hereinbefore set forth, and all income from such Defeasance Securities received by the Paying
Agent/Registrar that is not required for the payment of the Bonds and interest thereon,with respect
to which such money has been so deposited,shall be turned over to the City,or deposited as directed
in writing by the City. Any Future Escrow Agreement pursuant to which the money and/or
Defeasance Securities are held for the payment of Defeased Bonds may contain provisions
permitting the investment or reinvestment of such moneys in Defeasance Securities or the
substitution of other Defeasance Securities upon the satisfaction of the requirements specified in
subsection(a)(i)or(ii)of this Section. All income from such Defeasance Securities received by the
Paying Agent/Registrar which is not required for the payment of the Defeased Bonds,with respect
to which such money has been so deposited, shall be remitted to the City or deposited as directed
in writing by the City.
(c) The term "Defeasance Securities" means (i) direct, noncallable obligations of the
United States of America,including obligations that are unconditionally guaranteed by the United
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States of America,(ii)noncallable obligations of an agency or instrumentality of the United States
of America, including obligations that are unconditionally guaranteed or insured by the agency or
instrumentality and that, on the date of the purchase thereof are rated as to investment quality by a
nationally recognized investment rating firm not less than AAA or its equivalent, (iii)noncallable
obligations of a state or an agency or a county,municipality,or other political subdivision of a state
that have been refunded and that, on the date on the date the governing body of the City adopts or
approves the proceedings authorizing the financial arrangements are rated as to investment quality
by a nationally recognized investment rating firm not less than AAA or its equivalent, and(iv)any
other then authorized securities or obligations under applicable state law that may be used to defease
obligations such as the Bonds.
(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 City shall make proper arrangements to provide and
pay for such services as required by this Ordinance.
(e) In the event that the City elects to defease less than all of the principal amount of
Bonds of a maturity,the Paying Agent/Registrar shall select, or cause to be selected, such amount
of Bonds by such random method as it deems fair and appropriate.
SECTION 10. 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 City and to the Paying Agent/Registrar such
security or indemnity as may be required by them to save each of them harmless from any loss or
damage with respect thereto. Also, in every case of loss, theft, or destruction of a Bond, the
registered owner shall furnish to the City and to the Paying Agent/Registrar evidence to their
satisfaction of the loss,theft, or destruction of such Bond. 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 mutilated.
(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 continuing in
the payment of the principal of or interest on the Bond,the City may authorize the payment of the
same (without surrender thereof except in the case of a damaged or mutilated Bond) instead of
issuing a replacement Bond,provided security or indemnity is furnished as above provided in this
Section.
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(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 City 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 accordance with Chapter 1201, Texas
Government Code, as amended, this Section 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 City 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
authenticate 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 conversion and exchange for other Bonds.
SECTION 11. CUSTODY,APPROVAL,AND REGISTRATION OF BONDS; BOND
COUNSEL'S OPINION;CUSIP NUMBERS;AND OTHER MATTERS. The Mayor or Mayor
Pro-Tem of the City 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 registration by the Comptroller of Public Accounts of the State of Texas. Upon registration
of the Bonds said Comptroller of Public Accounts(or a deputy designated in writing to act for said
Comptroller)shall manually sign the Comptroller's Registration Certificate 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 City's Bond Counsel (with an appropriate certificate pertaining
thereto executed by facsimile signature of the City Secretary of the City) and the assigned CUSIP
numbers may, at the option of the City, 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. If bond insurance is obtained,the Bonds may
bear an appropriate legend as provided by the insurer.
SECTION 12. COVENANTS REGARDING TAX EXEMPTION OF INTEREST ON
THE BONDS. (a) Covenants. The City covenants to take any action necessary to assure,or refrain
from any action which would adversely affect,the treatment of the Bonds as obligations described
in section 103 of the Internal Revenue Code of 1986,as amended(the"Code"),the interest on which
is not includable in the "gross income" of the holder for purposes of federal income taxation. In
furtherance thereof, the City covenants as follows:
(1) to take any action to assure that no more than 10 percent of the proceeds of the
Bonds or the projects financed therewith(less amounts deposited to a reserve fund,if any)
are used for any "private business use," as defined in section 141(b)(6) of the Code or, if
more than 10 percent of the proceeds of the Bonds or the projects financed therewith are so
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used, such amounts, whether or not received by the City, with respect to such private
business use, do not, under the terms of this Ordinance or any underlying arrangement,
directly or indirectly, secure or provide for the payment of more than 10 percent of the debt
service on the Bonds, in contravention of section 141(b)(2) of the Code;
(2) to take any action to assure that in the event that the "private business use"
described in subsection (1) hereof exceeds 5 percent of the proceeds of the Bonds or the
projects financed therewith (less amounts deposited into a reserve fund, if any) then the
amount in excess of 5 percent is used for a"private business use"which is"related" and not
"disproportionate,"within the meaning of section 141(b)(3)of the Code,to the governmental
use;
(3) to take any action to assure that no amount which is greater than the lesser of
$5,000,000,or 5 percent of the proceeds of the Bonds(less amounts deposited into a reserve
fund,if any)is directly or indirectly used to finance loans to persons,other than state or local
governmental units, in contravention of section 141(c) of the Code;
(4) to refrain from taking any action which would otherwise result in the Bonds
being treated as "private activity bonds"within the meaning of section 141(b) of the Code;
(5) to refrain from taking any action that would result in the Bonds being"federally
guaranteed" within the meaning of section 149(b) of the Code;
(6) to refrain from using any portion of the proceeds of the Bonds, directly or
indirectly,to acquire or to replace funds which were used,directly or indirectly,to acquire
investment property (as defined in section 148(b)(2) of the Code) which produces a
materially higher yield over the term of the Bonds,other than investment property acquired
with--
(A) proceeds of the Bonds invested for a reasonable temporary period of
three years or less until such proceeds are needed for the purpose for which the
Bonds are issued,
(B) amounts invested in a bona fide debt service fund, within the meaning
of section 1.148-1(b) of the Treasury Regulations, and
(C) amounts deposited in any reasonably required reserve or replacement
fund to the extent such amounts do not exceed 10 percent of the proceeds of the
Bonds;
(7) to otherwise restrict the use of the proceeds of the Bonds or amounts treated as
proceeds of the Bonds, as may be necessary,so that the Bonds do not otherwise contravene
the requirements of section 148 of the Code (relating to arbitrage) and, to the extent
applicable, section 149(d) of the Code(relating to advance refundings);
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(8) to pay to the United States of America at least once during each five-year period
(beginning on the date of delivery of the Bonds)an amount that is at least equal to 90 percent
of the"Excess Earnings,"within the meaning of section 148(f)of the Code and to pay to the
United States of America,not later than 60 days after the Bonds have been paid in full, 100
percent of the amount then required to be paid as a result of Excess Earnings under section
148(f) of the Code; and
(9)to assure that the proceeds of the Certificates of Ob ligation will be used solely
for new money projects.
(b) Rebate Fund. In order to facilitate compliance with the above covenant (8), a
"Rebate Fund"is hereby established by the City for the sole benefit of the United States of America,
and such fund shall not be subject to the claim of any other person,including without limitation the
bondholders. The Rebate Fund is established for the additional purpose of compliance with section
148 of the Code.
(c) Proceeds. The City understands that the term "proceeds" includes "disposition
proceeds" as defined in the Treasury Regulations and, in the case of refunding bonds, transferred
proceeds(if any) and proceeds of the refunded bonds expended prior to the date of issuance of the
Bonds. It is the understanding of the City that the covenants contained herein are intended to assure
compliance with the Code and any regulations or rulings promulgated by the U.S. Department of
the Treasury pursuant thereto. In the event that regulations or rulings are hereafter promulgated
which modify or expand provisions of the Code, as applicable to the Bonds, the City will not be
required to comply with any covenant contained herein to the extent that such failure to comply,in
the opinion of nationally recognized bond counsel, will not adversely affect the exemption from
federal income taxation of interest on the Bonds under section 103 of the Code. In the event that
regulations or rulings are hereafter promulgated which impose additional requirements which are
applicable to the Bonds, the City agrees to comply with the additional requirements to the extent
necessary, in the opinion of nationally recognized bond counsel, to preserve the exemption from
federal income taxation of interest on the Bonds under section 103 of the Code. In furtherance of
such intention,the City hereby authorizes and directs the Mayor,the City Manager or the Director
of Finance of the City to execute any documents, certificates or reports required by the Code and
to make such elections,on behalf of the City,which maybe permitted by the Code as are consistent
with the purpose for the issuance of the Bonds.
(d) Allocation of, and Limitation on, Expenditures for the Project. The City covenants
to account for the expenditure of sale proceeds and investment earnings to be used for the purposes
described in Section 1 of this Ordinance (collectively referred to herein as the "Project") on its
books and records in accordance with the requirements of the Internal Revenue Code. The City
recognizes that in order for the proceeds to be considered used for the reimbursement of costs,the
proceeds must be allocated to expenditures within 18 months of the later of the date that (1) the
expenditure is made, or(2)the Project is completed;but in no event later than three years after the
date on which the original expenditure is paid. The foregoing notwithstanding,the City recognizes
that in order for proceeds to be expended under the Internal Revenue Code, the sale proceeds or
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investment earnings must be expended no more than 60 days after the earlier of (1) the fifth
anniversary of the delivery of the Bonds, or(2) the date the Bonds are retired. The City agrees to
obtain the advice of nationally-recognized bond counsel if such expenditure fails to comply with the
foregoing to assure that such expenditure will not adversely affect the tax-exempt status of the
Bonds. For purposes hereof, the City shall not be obligated to comply with this covenant if it
obtains an opinion that such failure to comply will not adversely affect the excludability for federal
income tax purposes from gross income of the interest.
(e) Disposition of Proj ect. The City covenants that the property constituting the projects
financed or refinanced with the proceeds of the Bonds will not be sold or otherwise disposed in a
transaction resulting in the receipt by the City of cash or other compensation,unless the City obtains
an opinion of nationally-recognized bond counsel that such sale or other disposition will not
adversely affect the tax-exempt status of the Bonds. For purposes of the foregoing, the portion of
the property comprising personal property and disposed in the ordinary course shall not be treated
as a transaction resulting in the receipt of cash or other compensation. For purposes hereof,the City
shall not be obligated to comply with this covenant if it obtains an opinion that such failure to
comply will not adversely affect the excludability for federal income tax purposes from gross
income of the interest.
(f) Designation as Qualified Tax-Exempt Obligations. The City hereby designates the
Bonds as "qualified tax-exempt bonds" as defined in section 265(b)(3)of the Code. In furtherance
of such designation, the City represents, covenants and warrants the following: (i)that during the
calendar year in which the Bonds are issued, the City(including any subordinate entities)has not
designated nor will designate bonds,which when aggregated with the Bonds,will result in more than
$10,000,000 ($30,000,000 for taxable years beginning after December 31, 2008 and ending prior
to January 1, 2011) of "qualified tax-exempt bonds" being issued; (ii) that the City reasonably
anticipates that the amount of tax-exempt obligations issued,during the calendar year in which the
Bonds are issued,by the City(or any subordinate entities)will not exceed$10,000,000($30,000,000
for taxable years beginning after December 31,2008 and ending prior to January 1,2011);and,(iii)
that the City will take such action or refrain from such action as necessary,and as more particularly
set forth in this Section, in order that the Bonds will not be considered "private activity bonds"
within the meaning of section 141 of the Code.
SECTION 13. SALE AND DELIVERY OF BONDS. The Bonds are hereby authorized
to be sold and shall be delivered to SAMCO CAPITAL,MARKETS,INC., as representative of the
Underwriters (collectively,the "Underwriters") at a price equal to $ (which amount is
equal to par, [plus/less]net original issue premium of$ , and less Underwriters'discount
of$ ),plus accrued interest to date of delivery,all pursuant to the terms and provisions
of a Purchase Contract in substantially the form attached hereto as Exhibit B which the Mayor or
Mayor-Pro Tem is hereby authorized and directed to execute and deliver. The City will deliver to
the Underwriters an Initial Bond in the aggregate principal amount of$ payable in
principal installments on the dates and in the principal amounts shown in Section 2 hereof, and
bearing interest at the rates for each respective maturity as shown in Section 3 hereof. The Bonds
shall initially be registered in the name of SAMCO CAPITAL,MARKETS,INC.
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SECTION 14. APPROVAL OF OFFICIAL STATEMENT. The City Council hereby
approves the form and content of the Official Statement relating to the Bonds and any addenda,
supplement, or amendment thereto, and approves the distribution of the 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. The distribution and use of the Preliminary Official Statement
for the Bonds, dated _, 2009,prior to the date hereof is hereby ratified and confirmed.
The City Council finds and determines that the Preliminary Official Statement and the Official
Statement were and are"deemed final" as of each of their respective dates within the meaning,and
for the purpose,of Rule 15c2-12 promulgated under authority granted by the Federal Securities and
Exchange Act of 1934.
SECTION 15. MUNICIPAL BOND INSURANCE POLICY. On the date of delivery of
the Bonds,the City will obtain from (the"Insurer")a municipal bond insurance
policy in support of the Bonds. To that end, for so long as said policy is in effect, the ordinance
requirements of the Insurer, as a condition to the issuance of said policy, attached hereto as
Exhibit C, are incorporated by reference into this Ordinance and made a part hereof for all purposes,
notwithstanding any other provision of this Ordinance to the contrary. The Issuer is authorized to
use proceeds of the Bonds to purchase such policy.
SECTION 16. AUTHORITY FOR OFFICERS TO EXECUTE DOCUMENTS AND
APPROVE CHANGES. The Mayor,Mayor Pro-Tem,City Secretary,City Manager and Director
of Finance of the City, and all other officers, employees, and agents of the City, and each of them,
shall be and they are hereby expressly authorized, empowered, and directed from time to time and
at any time to do and perform all such acts and things and to execute, acknowledge, and deliver in
the name and under the corporate seal and on behalf of the City all such instruments,whether or not
herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions
of this Ordinance, the Bonds, the sale of the Bonds, the Official Statement, and the Paying
Agent/Registrar Agreement. In addition,prior to the initial delivery of the Bonds,the Mayor,Mayor
Pro-Tern, City Secretary,City Manager,Director of Finance,City Attorney and Bond Counsel are
hereby authorized and directed to approve any technical changes or correction to this Ordinance or
to any of the instruments authorized and approved by this Ordinance necessary in order to(i)correct
any ambiguity or mistake or properly or more completely document the transactions contemplated
and approved by this Ordinance and as described in the Official Statement,(ii)obtain a rating from
any of the national bond rating agencies or satisfy any requirements of the provider of a municipal
bond insurance policy, if any, or(iii) obtain the approval of the Bonds by the Attorney General's
office. In case any officer whose signature shall appear on any Bond shall cease to be such officer
before the delivery of such Bond, such signature shall nevertheless be valid and sufficient for all
purposes the same as if such officer had remained in office until such delivery. The Director of
Finance of the City is further authorized to pay to the Attorney General of Texas prior to the delivery
of the Bonds,for the Attorney General's review of the transcript ofproceedings related to the Bonds,
the amount required pursuant to Section 1202.004, Texas Government Code, as amended.
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SECTION 17. ORDINANCE A CONTRACT; AMENDMENTS. This Ordinance shall
constitute a contract with the Registered Owners of the Bonds,binding on the City and its successors
and assigns, and shall not be amended or repealed by the City as long as any Bond remains
outstanding except as permitted in this Section. The City may, with prior written notice to the
Insurer but without the consent of or notice to any Registered Owners, amend, change, or modify
this Ordinance as may be required (i) by the provisions hereof, (ii) for the purpose of curing any
ambiguity,inconsistency,or formal defect or omission herein, or(iii)in connection with any other
change which is not to the prejudice of the Registered Owners. The City may, with the written
consent of the Insurer and the Registered Owners of a majority in aggregate principal amount of the
Bonds then outstanding affected thereby, amend,change,modify,or rescind any provisions of this
Ordinance; provided that without the consent of the Insurer and all of the Registered Owners
affected,no such amendment,change,modification,or rescission shall(i) extend the time or times
of payment of the principal of and interest on the Bonds,reduce the principal amount thereof or the
rate of interest thereon, (ii) give any preference to any Bond over any other Bond, (ii) extend any
waiver of default to subsequent defaults, or (iv) reduce the aggregate principal amount of Bonds
required for consent to any such amendment, change, modification, or rescission. Whenever the
City shall desire to make any amendment or addition to or rescission of this Ordinance requiring
consent of the Registered Owners, the City shall cause notice of the amendment, addition, or
rescission to be sent by first class mail, postage prepaid, to the Insurer at the address shown on
Exhibit E attached hereto and to the Registered Owners at the respective addresses shown on the
Registration Books. Whenever at any time within one year after the date of the giving of such
notice,the City shall receive an instrument or instruments in writing executed by the Insurer and the
Registered Owners of a majority in aggregate principal amount of the Bonds then outstanding
affected by any such amendment,addition,or rescission requiring the consent of the Insurer and the
Registered Owners, which instrument or instruments shall refer to the proposed amendment,
addition, or rescission described in such notice and shall specifically consent to and approve the
adoption thereof in substantially the form of the copy thereof referred to in such notice,thereupon,
but not otherwise,the City may adopt such amendment,addition,or rescission in substantially such
form,except as herein provided. No Registered Owner may thereafter object to the adoption of such
amendment, addition, or rescission, or to any of the provisions thereof, and such amendment,
addition, or rescission shall be fully effective for all purposes.
SECTION 18.INTERESTED PARTIES. Nothing in this Ordinance expressed or implied
is intended or shall be construed to confer upon, or to give to, any person or entity, other than the
City and the registered owners of the Bonds, any right,remedy or claim under or by reason of this
Ordinance or any covenant,condition or stipulation hereof,and all covenants,stipulations,promises
and agreements in this Ordinance contained by and on behalf of the City shall be for the sole and
exclusive benefit of the City and the registered owners of the Bonds.
SECTION 19. COMPLIANCE WITH RULE 15c2-12.
(a) Definitions. As used in this Section,the following terms have the meanings ascribed to
such terms below:
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"EMMA" means the Electronic Municipal Market Access system being established by the
MSRB.
"MSRB" means the Municipal Securities Rulemaking Board.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
(b) Annual Reports. The City shall provide annually to the MSRB through EMMA within
six months after the end of each fiscal year ending in or after 2009, financial information and
operating data with respect to the City of the general type included in the fmal Official Statement
authorized by this Ordinance being the information described in Exhibit D hereto. Any financial
statements so to be provided shall be (1) prepared in accordance with the accounting principles
described in Exhibit D hereto, or such other accounting principles as the City may be required to
employ from time to time pursuant to state law or regulation, and (2) audited, if the City
commissions an audit of such statements and the audit is completed within the period during which
they must be provided. If the audit of such financial statements is not complete within such period,
then the City shall provide (1) unaudited financial statements for such fiscal year within such six
month period, and (2) audited financial statements for the applicable fiscal year to the MSRB
through EMMA when and if the audit report on such statements become available.
If the City changes its fiscal year,it will notify the MSRB through EMMA of the date of the
new fiscal year end prior to the next date by which the City otherwise would be required to provide
financial information and operating data pursuant to this paragraph(b).
The financial information and operating data to be provided pursuant to this paragraph(b)
may be set forth in full in one or more documents or may be included by specific reference to any
document (including an official statement or other offering document, if it is available from the
MSRB)that theretofore has been provided to the MSRB through EMMA or filed with the SEC.
(c) Material Event Notices. The City shall notify the MSRB through EMMA in a timely
manner, of any of the following events with respect to the Bonds, if such event is material within
the meaning of the federal securities laws:
A. Principal and interest payment delinquencies;
B. Non-payment related defaults;
C. Unscheduled draws on debt service reserves reflecting financial difficulties;
D. Unscheduled draws on credit enhancements reflecting financial difficulties;
E. Substitution of credit or liquidity providers, or their failure to perform;
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F. Adverse tax opinions or events affecting the tax-exempt status of the Bonds;
G. Modifications to rights of holders of the Bonds;
H. Certificate of Obligation calls;
I. Defeasances;
J. Release, substitution, or sale of property securing repayment of the Bonds;
and
K. Rating changes.
The City shall notify the MSRB through EMMA,in a timely manner, of any failure by the
City to provide financial information or operating data in accordance with paragraph (b) of this
Section by the time required by such paragraph.
(d) Limitations.Disclaimers, and Amendments. The City shall be obligated to observe and
perform the covenants specified in this Section for so long as, but only for so long as, the City
remains an"obligated person"with respect to the Bonds within the meaning of the Rule,except that
the City in any event will give notice of any deposit made in accordance with Section 8 of this
Ordinance that causes Bonds no longer to be outstanding.
The provisions of this Section are for the sole benefit of the holders and beneficial owners
of the Bonds, and nothing in this Section, express or implied, shall give any benefit or any legal or
equitable right, remedy, or claim hereunder to any other person. The City undertakes to provide
only the financial information, operating data, financial statements, and notices which it has
expressly agreed to provide pursuant to this Section and does not hereby undertake to provide any
other information that may be relevant or material to a complete presentation of the City's financial
results, condition, or prospects or hereby undertake to update any information provided in
accordance with this Section or otherwise, except as expressly provided herein. The City does not
make any representation or warranty concerning such information or its usefulness to a decision to
invest in or sell Bonds at any future date.
UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR
BENEFICIAL OWNER OF ANY CERTIFICATE OF OBLIGATION OR ANY OTHER PERSON,
IN CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM
ANY BREACH BY THE CITY, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS
PART, OF ANY COVENANT SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND
REMEDY OF ANY SUCH PERSON,IN CONTRACT OR TORT,FOR OR ON ACCOUNT OF
ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR
SPECIFIC PERFORMANCE.
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No default by the City in observing or performing its obligations under this Section shall
comprise a breach of or default under this Ordinance for purposes of any other provision of this
Ordinance.
Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the
duties of the City under federal and state securities laws.
The provisions of this Section may be amended by the City from time to time to adapt to
changed circumstances that arise from a change in legal requirements,a change in law,or a change
in the identity,nature, status,or type of operations of the City,but only if(1)the provisions of this
Section, as so amended, would have permitted an underwriter to purchase or sell Bonds in the
primary offering of the Bonds in compliance with the Rule,taking into account any amendments or
interpretations of the Rule since such offering as well as such changed circumstances and(2)either
(a)the holders of a majority in aggregate principal amount(or any greater amount required by any
other provision of this Ordinance that authorizes such an amendment) of the Outstanding Bonds
consent to such amendment or (b) a person that is unaffiliated with the City (such as nationally
recognized bond counsel) determined that such amendment will not materially impair the interest
of the holders and beneficial owners of the Bonds. The City may also amend or repeal the
provisions of this continuing disclosure agreement if the SEC amends or repeals the applicable
provision of the Rule or a court of final jurisdiction enters judgment that such provisions of the Rule
are invalid,but only if and to the extent that the provisions of this sentence would not prevent an
underwriter from lawfully purchasing or selling Bonds in the primary offering of the Bonds. If the
City so amends the provisions of this Section, it shall include with any amended financial
information or operating data next provided in accordance with paragraph (b) of this Section an
explanation,in narrative form,of the reason for the amendment and of the impact of any change in
the type of financial information or operating data so provided.
SECTION 20. SECURITY INTEREST. Chapter 1208,Texas Government Code, applies
to the issuance of the Bonds and the pledge of the ad valorem taxes granted by the City under
Section 6 of this Ordinance,and is therefore valid,effective,and perfected. If Texas law is amended
at any time while the Bonds are outstanding and unpaid such that the pledge of the ad valorem taxes
or surplus revenues granted by the City under Section 6 of this Ordinance is to be subject to the
filing requirements of Chapter 9, Texas Business &Commerce Code, then in order to preserve to
the registered owners of the Bonds the perfection of the security interest in said pledge, the City
agrees to take such measures as it determines are reasonable and necessary under Texas law to
comply with the applicable provisions of Chapter 9,Texas Business&Commerce Code,and enable
a filing to perfect the security interest in said pledge to occur.
SECTION 21. REMEDIES IN EVENT OF DEFAULT. In addition to all the rights and
remedies provided by the laws of the State of Texas, it is specifically covenanted and agreed
particularly that in the event the City(i) defaults in the payment of the principal,premium, if any,
or interest on the Bonds, (ii) defaults in the deposits and credits required to be made to the Interest
and Sinking Fund, or(iii) defaults in the observance or performance of any other of the covenants,
conditions or obligations set forth in this Ordinance and the continuation thereof for 30 days after
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the City has received written notice of such defaults, the Holders of any of the Bonds shall be
entitled to seek a writ of mandamus issued by a court of proper jurisdiction compelling and requiring
the governing body of the City and other officers of the City to observe and perform any covenant,
condition or obligation prescribed in this Ordinance. Notwithstanding the foregoing, the Insurer
shall have the right to direct all remedies upon an event of default, and the Insurer shall be
recognized as the registered owner of the Bonds for the purposes of exercising all rights and
privileges available to the Holders.
No delay or omission to exercise any right or power accruing upon any default shall impair
any such right or power or shall be construed to be a waiver of any such default or acquiescence
therein,and every such right and power may be exercised from time to time and as often as may be
deemed expedient. The specific remedy herein provided shall be cumulative of all other existing
remedies, and the specification of such remedy shall not be deemed to be exclusive.
SECTION 22. INCORPORATION OF RECITALS. The City hereby finds that the
statements set forth in the recitals of this Ordinance are true and correct, and the City hereby
incorporates such recitals as a part of this Ordinance.
SECTION 23. SEVERABILITY. If any provision of this Ordinance or the application
thereof to any circumstance shall be held to be invalid, the remainder of this Ordinance and the
application thereof to other circumstances shall nevertheless be valid, and this governing body
hereby declares that this Ordinance would have been enacted without such invalid provision.
SECTION 24. EFFECTIVE DATE. Pursuant to the provisions of Section 1201.028,Texas
Government Code,this Ordinance shall become effective immediately after its adoption by the City
Council.
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PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF CIBOLO,
TEXAS ATA REGULAR MEETING HELD ON THE 9TH DAY OF JUNE, 2009,AT WHICH
MEETING A QUORUM WAS PRESENT.
Mayor, City of Cibolo, Texas
ATTEST:
City Secretary
City of Cibolo, Texas
(City Seal)
** ** ** ** **
[EXECUTION PAGE TO THE BOND ORDINANCE]
EXHIBIT A
THE PAYING AGENT/REGISTRAR AGREEMENT IS OMITTED AT THIS POINT AS IT APPEARS IN
EXECUTED FORM ELSEWHERE IN THIS TRANSCRIPT OF PROCEEDINGS.
A-1
EXHIBIT B
THE PURCHASE CONTRACT IS OMITTED AT THIS POINT AS IT APPEARS IN EXECUTED FORM
ELSEWHERE IN THIS TRANSCRIPT OF PROCEEDINGS.
B-1
EXHIBIT C
REQUIREMENTS OF THE INSURER
WITH RESPECT TO THE MUNICIPAL BOND INSURANCE POLICY
C-1
EXHIBIT D
DESCRIPTION OF ANNUAL FINANCIAL INFORMATION
The following information is referred to in Section 19 of this Ordinance.
Annual Financial Statements and Operating Data
The financial information and operating data with respect to the City to be provided annually
in accordance with such Section are as specified (and included in the Appendix or under the
headings of the Official Statement referred to)below:
1. The annual audited financial statements of the City or the unaudited fmancial
statements of the City in the event audited financial statements are not completed within six months
after the end of any fiscal year.
2. All quantitative fmancial information and operating data with respect to the City of
the general type included in the Official Statement under Table 1 in the main body of the Official
Statement and in Tables 1 through 10 of Appendix A thereof.
Accounting Principles
The accounting principles referred to in such Section are the accounting principles described
in the notes to the fmancial statements referred to in paragraph 1 above.
D-1