Ord 1351 09/28/2021 Refunding Bond DRAFT
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ORDINANCE
AN ORDINANCE BY THE CITY COUNCIL OF THE CITY OF CIBOLO,
TEXAS AUTHORIZING THE ISSUANCE OF"CITY OF CIBOLO,TEXAS
GENERAL OBLIGATION REFUNDING BONDS, SERIES 2021",
LEVYING A CONTINUING DIRECT ANNUAL AD VALOREM TAX,
WITHIN THE LIMITATIONS PRESCRIBED BY LAW, FOR - THE
PAYMENT OF THE BONDS; PRESCRIBING THE FORM, TERMS,
CONDITIONS, AND RESOLVING OTHER MATTERS INCIDENT AND
RELATED TO THE ISSUANCE,SALE,AND DELIVERY OF THE BONDS,
INCLUDING THE APPROVAL AND DISTRIBUTION OF NOTICE OF
SALE AND AN OFFICIAL STATEMENT PERTAINING. THERETO;
AUTHORIZING THE EXECUTION OF A PAYING AGENTIREGISTRAR
AGREEMENT, AN ESCROW DEPOSIT LETTER, AND AN OFFICIAL
BID FORM; COMPLYING WITH THE LETTER OF
REPRESENTATIONS ON FILE WITH THE DEPOSITORY TRUST -
COMPANY; DELEGATING THE AUTHORITY TO CERTAIN CITY
STAFF TO EXECUTE CERTAIN DOCUMENTS RELATING TO THE
SALE OF THE BONDS; AND PROVIDING AN EFFECTIVE-DATE
WHEREAS, the City Council(the City Council) of the City of Cibolo, Texas (the City or
the Issuer) has heretofore issued, sold, and delivered, and there are currently outstanding
obligations in the aggregate original principal amount of$11,940,000,being the obligations set
forth on Schedule I hereto which is incorporated by reference for all purposes to this ordinance
(the Refunded Obligations); and
WHEREAS, the City Council intends to issue an aggregate principal amount of-
$ in general obligation refunding bonds the proceeds of which will be utilized to
provide for the.(i) discharge and'final payment of the Refunded Obligations for debt service
savings, and(ii)payment of the costs of issuance of general obligation refunding bonds; and
WHEREAS, pursuant to the provisions of Chapter 1207, as amended, Texas Government
Code (the Act), the City Council is authorized to issue refunding bonds and deposit the proceeds
of sale under an escrow agreement to provide for the payment of the Refunded Obligations, and
such deposit;when Made in accordance with the Act, shall constitute the making of firm banking
and financial arrangements for the discharge and final payment of the Refunded Obligations; and
WHEREAS,the Act permits that the deposit of the proceeds from the sale of the refunding
bonds be deposited directly with any designated escrow agent which is not the depository bank of
the City; and
WHEREAS,when,firm banking arrangements have been made for the payment of principal
of and interest to the stated maturity or redemption dates of the Refunded Obligations, then the
Refunded Obligations shall no longer be regarded as outstanding except -for the purpose of
receiving payment from the funds provided for such purpose and may not be included in or
considered to be an indebtedness of the City for the purpose of a limitation on outstanding
indebtedness or taxation or for any other purpose; and
WHEREAS, BOKF, NA, Dallas, Texas, currently serves as the paying agent for the
Refunded Obligations; and
WHEREAS, UMB Bank, N.A., Austin, Texas, is hereby appointed as the Paying Agent
and the Escrow Agent(hereinafter defined) for the Bonds (hereafter defined); and
WHEREAS, the City Council also hereby finds and determines that the Refunded
Obligations are scheduled to mature or are subject to being redeemed, not more than twenty (20)
years from the date of the general obligation refunding bonds herein authorized and being issued
to restructure the City's debt service and associated tax rates in the coming years, and such
refunding will result in a net present value savings of$ (or %), and a
gross savings of$ ; and
WHEREAS, the City Council hereby finds and determines that the issuance of general
obligation refunding bonds for the purpose of refunding the Refunded Obligations is in the best
interests of the residents of the City, now, therefore,
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CIBOLO:
SECTION 1. Authorization - Designation - Principal Amount - Purpose. General
obligation refunding bonds of the.City shall be and are hereby authorized to be issued in the
aggregate principal amount of AND NO/100 DOLLARS
($ ), to be designated and bear the title of "CITY OF CIBOLO, TEXAS
-GENERAL OBLIGATION REFUNDING BONDS, SERIES 2021" (the Bonds), for the purpose
of providing funds for the (i) discharge and final payment of the Refunded Obligations for debt
service savings, and (ii) payment of the costs of issuance of the Bonds, all in conformity with the
laws of the.State of:Texas, particularly the Act, this ordinance adopted by-the City.Council on
September 28, 2021, and the City's Home Rule Charter.
As authorized by the Act, as amended, Texas Government Code, the Mayor, the Mayor
Pro Tem, the City Manager, the Director of Finance, and/or the City Secretary (each of the
foregoing, individually; an Authorized Off cial are each hereby authorized, appointed,. and
designated as the officer of the City authorized to act on behalf of the City in selling and delivering
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the Bonds authorized herein and carrying out the procedures specified in this Ordinance,including
approval of the aggregate principal amount of each maturity of the Bonds, the redemption
provisions therefor, the Dated-Date thereof, the method of sale, the designation of the Bonds as
taxable or tax-exempt obligations,the selection from the Refunding Candidates as to the Refunded
Obligations, and the rate of interest to be borne on the principal amount of each series. Each
Authorized Official, acting for and on behalf of the City, is authorized to execute the Approval
Certificate attached as Schedule II hereto. The Bonds shall be issued in the principal amount not
to exceed $12,000,000, the latest permitted maturity of the Bonds will be February 1, 2035, the
refunding will result in a net present value savings of at least 4.00%, and the net effective per
annum interest rate shall not exceed a rate greater than 6.00%per annum calculated in a manner
consistent with the provisions of Chapter 1204, as amended,. Texas Government Code. Each
Authorized Official may select and effectuate the provision of a bond insurance policy related to
the Bonds; as necessary or desired. The execution of the Approval Certificate shall evidence the
sale date of the Bonds by the City to the Purchasers (hereinafter defined) in accordance with the
provisions of the Act. Upon execution of the Approval Certificate, Bond Counsel is authorized to
complete this Ordinance to reflect such fmalterms.
SECTION 2.Fully Registered Obligations-Authorized Denominations-Stated Maturities
- Interest Rates - Dated Date. The Bonds shall be issued as fully registered obligations, without
coupons, shall be dated November 1, 2021. (the Dated Date), and shall generally be in
denominations of$5,000 or any integral multiple thereof, and the Bonds shall be lettered"R" and
numbered consecutively from One (1) upward, and principal.shall become due and payable on
February 1 in each of the years and in principal amounts.(the Stated Maturities) and bear interest
on the unpaid principal amounts from the Closing Date (hereinafter defined), or from the most
recent Interest Payment Date(hereinafter defined)to which interest has been paid or duly provided
for, to the earlier of redemption or Stated Maturity, at the per annum rates, while Outstanding, in
accordance with the following schedule:
Years of Principal Interest
Stated Maturity Amounts ($) Rates
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
The.Bonds shall bear interest on the unpaid principal amounts from the Closing Date
(anticipated to occur on or about November 10, 2021), or from the most recent Interest.Payment
Date (hereinafter defined)to which interest has been paid or duly provided for,to Stated Maturity
or prior redemption, while Outstanding, at the rates per annum shown in the above schedule
(calculated on the basis of a 360-day year of twelve 30-day months). Interest on the Bonds shall
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: be payable on February l.and August 1 in each year(each,an Interest Payment Date),commencing
February 1, 2022 while the Bonds are Outstanding.
SECTION 3. Payment of Bonds - Paying Agent/Registrar.
The principal of,premium,if any, and the interest on the Bonds,due and payable by reason
of Stated Maturity,redemption,or otherwise, shall be payable in any coin or currency of the United
States of America which at the time of payment is legal tender for the payment of public and
private debts;and such payment of principal of, premium, if any, and interest on the Bonds shall
be without exchange or collection charges to the Holder (as hereinafter defined) of the Bonds.
The selection and appointment of UMB .Bank, N.A., Austin, Texas (the Paying
AgentIRegistrar) to serve as the:initial Paying Agent/Registrar for the Bonds is hereby approved
and confirmed, and the City agrees and covenants to cause to be kept and maintained at the
corporate trust office of the Paying Agent/Registrar books and records (the Security Register) for
the registration,payment, and transfer of the Bonds, all as provided herein, in accordance with the.
terms and provisions of a Paying Agent/Registrar Agreement, attached,in substantially final form,
as Exhibit A hereto, and such reasonable rules and regulations as the Paying Agent/Registrar and
the City may prescribe. The City covenants to maintain and provide a Paying Agent/Registrar at
all times while the Bonds are Outstanding, and any successor Paying Agent/Registrar shall be (i)
a national or state banking institution or (ii) an association or a corporation organized and doing
business under the laws of the United States of America or of any state, authorized under such
laws to exercise trust powers. Such Paying Agent/Registrar shall be subject to supervision or
examination by federal or state authority and authorized by law to serve as a Paying
Agent/Registrar.
The City reserves the right to appoint a successor Paying Agent/Registrar upon providing,
the previous Paying Agent/Registrar with a certified copy of a resolution or ordinance terminating
such agency:Additionally, the City agrees to promptly cause a written notice of.this substitution
to be sent to each Holder of the Bonds by United States mail, first-class postage prepaid, which
notice shall also give the address of the new Paying Agent/Registrar.
Principal of,.premium, if any,. and interest on the Bonds, due and payable by reason of
Stated Maturity,or otherwise,shall be payable only to the registered owner of the-Bonds appearing
on the Security Register (the Holder or Holders) maintained on behalf of the City by the Paying
Agent/Registrar as hereinafter provided (i) on the Record Date (hereinafter defined) for purposes
of payment of interest on the Bonds, (ii) on the date of surrender of the Bonds for purposes of
receiving payment of principal thereof at the Bonds' Stated Maturity, and (iii) on any other date
for any other purpose. The City and the Paying Agent/Registrar, and any agent of either, shall treat
the Holder as the owner of a Bond for purposes of receiving payment and all other purposes
whatsoever, and neither the City nor the Paying Agent/Registrar, or any agent of either, shall be
affected by notice to the-contrary.
Principal of and premium, if any, on the Bonds shall be payable only upon presentation
and surrender:of the Bonds to the Paying Agent/Registrar at its corporate trust office. Interest on
the Bonds shall be paid to the Holder whose name appears in the Security Register at the close of
business on the fifteenth day of the month next preceding an Interest Payment Date for the Bonds
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(the Record Date) and shall be paid(i)by check sent on or prior to the appropriate date of payment
by United States mail, first-class postage prepaid,by the Paying Agent/Registrar,to the address of
the Holder appearing in the Security Register or(ii)by such other method,acceptable to the Paying
Agent/Registrar, requested in writingby the Holder at the Holder's risk and expense.
If the date for the payment of the principal of, premium, if any, or interest on the Bonds
shall be a.Saturday, a Sunday, a legal holiday, or a day on which banking institutions.in the city
where the,corporate 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 day. The payment on such date shall have the same force and effect as if made on the
original date any such payment on the Bonds was due.
In the event of a non-payment of interest on a scheduled payment date, and for thirty (30)
days thereafter, a new record date for such interest payment (a Special Record Date) will be
established by the Paying Agent/Registrar,if and when funds for the payment of such interest have
been received from the City.Notice of the Special Record Date and of the scheduled payment date
of the past due interest (the Special Payment Date - which shall be fifteen (15) days after the
Special Record Date) shall be sent at least five (5) business days prior to the Special Record Date
by United States mail, first-class postage prepaid, to the address of each Holder of a Bond
appearing on the Security Register at the close of business on the last business day of the month
next preceding the date of mailing of such notice.
SECTION 4. Redemption.
A. Optional Redemption of Bonds. The Bonds maturity on February 1, 2031 shall be
subject to redemption prior to Stated Maturity, at the option of the City, on February 1,2030 or on
any date thereafter, in whole or in part, in principal amounts of$5,000 or any integral multiple
thereof, (and if within a Stated Maturity selected at random and by lot by the Paying
Agent/Registrar) at the redemption price of par plus accrued interest to the date of redemption.
B. Exercise of Redemption Option. At least forty-five (45) days prior to a date set for
the redemption of the Bonds (unless a shorter notification period shall be satisfactory to the Paying
Agent/Registrar), the City shall notify the Paying Agent/Registrar of its decision to exercise the
right to redeem the Bonds, the principal amount of each Stated Maturity to be redeemed, and the
date set for the redemption thereof. The decision of the City to exercise the right to redeem the
Bonds shall be entered in the minutes of the Board of the City.
C. Selection of Bonds for Redemtp ion. If less than all Outstanding Bonds of the same
Stated Maturity are to be redeemed on a redemption date, the Paying Agent/Registrar shall select
at random and by lot the Bonds to be redeemed, provided that if less than the entire principal
amount of a Bond is to be redeemed,the Paying Agent/Registrar shall treat such Bond then subject
to redemption as representing the number of Bonds Outstanding which is obtained by dividing the
principal amount of such Bond by $5,000.
D. Notice of Redemption. Not less than thirty (30) days prior to the redemption date
for the Bonds,the Paying Agent/Registrar shall cause a notice of redemption to be sent by United
States mail, first-class postage prepaid, in the name of the City and at the City's expense, by the
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Paying Agent/Registrar to each Holder of a Bond to be redeemed in whole or in part at the address
of the Holder appearing on the Security Register at the time such.notice'of redemption is mailed,
and any notice of redemption so mailed shall be conclusively presumed to have been duly given
irrespective of whether received by the Holder. This notice may also be published once in a
financial publication,journal,or reporter of general circulation among securities dealers in the City
of New York, New York (including, but not limited to,'The Bond Buyer and The Wall Street
Journal), or in the State of Texas (including, but not limited to The Texas Bond Reporter).
All notices of redemption shall(i)specify the date of redemption for the Bonds, (ii)identify
the Bonds to be redeemed and, in the case of a portion of the principal amount to be redeemed,the
principal amount thereof to be redeemed, (iii) state the redemption price, (iv) state that the Bonds,
or the portion of the principal amount thereof to be redeemed, shall become due and payable on
the redemption date specified, and the interest thereon, or on the portion of the principal amount
thereof to be redeemed, shall cease to accrue from and after the redemption date, and (v) specify
that payment of the redemption price for the Bonds, or the principal amount thereof to be
redeemed, shall be made at,the corporate trust office of the Paying Agent/Registrar only upon
presentation and surrender thereof by the Holder.
-If a Bond is subject by its terms to redemption and has been called for redemption and
notice of redemption thereof has been duly given as hereinabove provided, such Bond (or the
principal amount thereof to be redeemed) so called for redemption shall become due and payable,
and if money sufficient for the payment of such Bonds (or of the principal amount thereof to be
redeemed) at the then applicable redemption price is held for the purpose of such payment by the
Paying Agent/Registrar, then on the redemption date designated in such notice, interest on the
Bond(or the principal amount thereof to be redeemed) called for redemption shall cease to accrue
and such Bonds shall.not be deemed to be Outstanding.
E. Transfer/Exchange of Bonds. Neither the City nor the Paying Agent/Registrar shall
be required to transfer or exchange any Bonds called for redemption, in whole or in part, during a
period beginning forty-five (45) days prior to the redemption date; provided, however such
limitation shall not,be applicable to an exchange by the Holder of the unredeemed balance of a
Bond which is subject to partial redemption.
SECTION 5. Execution - Registration. The Bonds shall be.executed on behalf of the City
by its Mayor or Mayor Pro Tem under the seal of the City reproduced or impressed thereon and
attested by its City Secretary. The signature of any of said officers on the Bonds may be manual,
electronic; or facsimile. Bonds bearing the manual, electronic, . or facsimile signatures of
individuals who were, at the time of the Dated Date,the proper officers of the City shall bind the
City, notwithstanding that suchindividuals or either of them shall cease to hold such offices prior
to the delivery of the Bonds to the Purchasers (hereinafter defined), all as authorized and provided
in Chapter 1201., as amended, Texas Government Code.
No. Bond shall be entitled to any right or benefit under this Ordinance, or be valid or
obligatory for any purpose,,unless there appears on such Bond either a certificate of registration
substantially in the form prvided in Section 8C, executed by the Comptroller of Public Accounts
of the State of Texas or his duly authorized agent by manual, facsimile, or electronic signature, or
a certificate of registration substantially in the form provided in Section 8D,executed by the Paying
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Agent/Registrar by manual, facsimile, or electronic signature, and either such certificate upon any
Bond shall be conclusive evidence, and the only evidence, that such Bond has been duly certified
or registered and delivered.
SECTION 6.Registration-Transfer-Exchange of Bonds-Predecessor Bonds.The Paying
Agent/Registrar shall obtain, record, and.maintain in the Security Register the name and.address
of every owner of the Bonds, or,if appropriate,the nominee thereof.Any Bond may,in accordance
with its terms and the terms hereof, be transferred or exchanged for Bonds of other authorized
denominations upon the Security Register by the Holder,in person or by his duly authorized agent,
upon surrender of such Bond to the Paying Agent/Registrar for cancellation, accompanied by a
written instrument of transfer or request for exchange duly executed by the Holder or by his duly
authorized agent, in form satisfactory to the Paying Agent/Registrar.
Upon surrender for transfer of any Bond at the corporate trust office of the Paying
Agent/Registrar, the City shall execute and the Paying Agent/Registrar shall register and deliver,
in the name of the designated transferee or transferees, one or more new Bonds of authorized
denomination and having the same Stated Maturity and of a like interest rate and aggregate
principal amount as the Bond or Bonds surrendered for transfer.
At the option of the Holder, Bonds may be exchanged for other Bonds of authorized
denominations and having the same Stated Maturity, bearing the same rate of interest and of like
aggregate principal amount as the Bonds surrendered for exchange upon surrender of the Bonds
to be exchanged at the corporate trust office of the Paying Agent/Registrar. Whenever any Bonds
are so surrendered for exchange, the-City shall execute, and the Paying,Agent/Registrar shall
register and deliver, the Bonds to the Holder requesting the exchange.
All Bonds issued upon any transfer or exchange of Bonds shall be delivered at the corporate
trust office of the Paying Agent/Registrar,or be sent by registered mail to the Holder at his request,
risk,and expense,and upon the delivery thereof,the same shall be the valid and binding obligations
of the City, evidencing the same obligation to pay, and entitled to the same benefits under this
Ordinance, as the Bonds surrendered upon such transfer or exchange.
All transfers or exchanges of Bonds pursuant to this Section shall be made without expense
or service charge to the Holder, except as otherwise herein provided, and except that the Paying
Agent/Registrar shall require payment by the Holder requesting such transfer or exchange of any
tax or other governmental charges required to be paid with respect to such transfer or exchange.
Bonds canceled by reason of an exchange or transfer pursuant to the provisions hereof are
hereby defined to be Predecessor Bonds, evidencing all or a portion, as the case may be, of the
same debt evidenced by the new Bond or Bonds registered and delivered in the exchange or
transfer therefor. Additionally,the term Predecessor Bonds shall include any Bond registered and
delivered pursuant to Section 17 in lieu of a mutilated, lost, destroyed, or stolen Bond which shall
be deemed to evidence the same obligation as the mutilated, lost, destroyed, or stolen Bond.
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SECTION 7. Initial Bond. The Bonds herein authorized shall be initially issued as either a
single fully registered Bond in the. aggregate principal amount of $ with principal
installmentsto become due and payable as provided in Section 2 hereof and numbered T-1, or(ii)
as one(1)fully registered Bond for each year of Stated Maturity in the applicable principal amount
and denomination and to be numbered consecutively from T-1 and upward (the Initial Bond, and
the Initial Bond shall_be registered in the name of the Purchasers.or. the designee thereof. The
Initial Bond shall be.the Bonds submitted to the Office of the Attorney General of the State of
Texas for approval, certified and registered by the Office of the Comptroller of Public Accounts
of the State of Texas and delivered to the Purchasers. Any time after the delivery of the Initial
Bond, the Paying Agent/Registrar, pursuant to written instructions from the Purchasers, or the
designee thereof,shall cancel the Initial Bond delivered hereunder and exchange therefor definitive
Bonds of like.kind and of authorized denominations, Stated Maturities,principal amounts bearing
applicableinterest rates, and shall be lettered "R" and numbered consecutively from one (1)
upward for transfer and delivery to the Holders named at the addresses identified therefor; all
pursuant to and.in accordance with such written instructions from the Purchasers, or the designee
thereof, and such other information and documentation as the Paying Agent/Registrar may
reasonably require.
SECTION 8. Forms.
A. Forms Generally. The Bonds, the Registration Certificate of the Comptroller of
Public Accounts of the State of Texas,the Registration Certificate of Paying Agent/Registrar, and
the form of Assignment to be printed on each of the Bonds shall be substantially in the forms set
forth in this Section with such appropriate insertions,omissions, substitutions,and other variations
as are permitted or required by this Ordinance and may have such letters,numbers, or other marks
of identification (including insurance legends in the event the Bonds, or any Stated Maturities
thereof, are insured and identifying numbers and letters of the Committee on Uniform Securities
Identification Procedures of the American Bankers Association) and such legends and
endorsements.(including insurance legends and any reproduction of an opinion of Bond Counsel
(hereinafter referenced)) thereon as may, consistent herewith, be established by the City or
determined by the officers executing the Bonds as evidenced by their execution thereof. Any
portion of the text of any Bond may be set forth on the reverse thereof, with an appropriate
reference.thereto on the face of the Bond.
The definitive Bonds shall be printed, lithographed; or engraved, produced by any
cornbination.of these methods, or produced in any other similar manner, all as determined by the
officers executing the Bonds as evidenced by their execution thereof, but the Initial Bond
submitted to the Attorney General of Texas may be typewritten or photocopied or otherwise
reproduced.
s
B. Form of Definitive Bond.
REGISTERED REGISTERED PRINCIPAL
NO. R- AMOUNT
UNITED STATES OF AMERICA
STATE OF TEXAS
COUNTY OF GUADALUPE
CITY OF CIBOLO, TEXAS
GENERAL OBLIGATION REFUNDING BONDS, SERIES 2021
Dated Date: Interest Rate: Stated Maturity: CUSIP.No.:
November 1, 2021
REGISTERED OWNER:
PRINCIPAL AMOUNT
The City of Cibolo, Texas (the City), a body corporate and a municipal corporation in the
County of Guadalupe, State of Texas, for value received, acknowledges itself indebted to and
hereby promises to pay to the order of the Registered Owner specified above, or the registered
assigns thereof, on the Stated Maturity date specified above (or so much as shall not have been
paid upon prior redemption), the Principal Amount specified above and to pay interest(computed
on the basis of a 360-day year of twelve 30-day months) on the unpaid Principal Amount hereof
from the Closing Date (anticipated to occur on or about November 10, 2021), or from the most
recent Interest Payment Date(hereinafter defined)to which interest has been paid or duly provided
for, to Stated Maturity, while Outstanding, at the per annum rate of interest specified above; such
interest being payable on February 1 and August 1 of each year (each, an Interest Payment Date),
commencing February 1, 2022.
Principal and premium, if any, on this Bond shall be payable to the Registered Owner
hereof(the Holder), upon presentation and surrender at the corporate trust office of the Paying
Agent/Registrar executing the registration certificate appearing hereon or a successor thereof.
Interest shall be payable to the Holder of this Bond(or one or more Predecessor Bonds, as defined
in the Ordinance hereinafter referenced) whose name appears on the Security Register maintained
by the Paying Agent/Registrar at the close of business on the Record Date, which is the fifteenth
day of the month next preceding each Interest Payment Date. All payments of principal of, and
interest on this Bond shall be in any coin or currency of the United States of America which at the
time of payment is legal tender for the payment of public and private debts. Interest shall be paid
by the Paying Agent/Registrar by check sent on or prior to the appropriate date of payment by
United States mail, first-class postage prepaid,to the Holder hereof at the address appearing in the
Security Register or by such other method, acceptable to the.Paying Agent/Registrar,requested by
the Holder hereof at the Holder's risk and expense. This Bond is one of the series specified in its
title issued in the aggregate principal amount of$ (the Bonds) pursuant to an
ordinance adopted by the governing body of the City(the Ordinance),for the purpose of providing
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funds for the(i) discharge and final payment of the Refunded Obligations for debt service savings,
and(ii)payment of-the costs of issuance of the Bonds,under and in strict conformity with the laws
of the State of Texas, including Chapter 1207, as amended, Texas Government Code, and the
City's Home Rule Charter.
The Bonds are payable from the proceeds of an annual ad valorem tax levied upon all
taxable property within the City within the limitations prescribed by law.. As specified in the
Ordinance, the Bonds maturity on February 1; 2031 shall be subject to redemption prior to Stated
Maturity, at the option of the City,on February 1, 2030, or on any date thereafter, in whole or in
part in principal amounts of$5,000 or any integral multiple thereof(and if within a Stated Maturity
selected at random and by lot by the Paying Agent/Registrar) at the redemption price of par,
together with accrued interest to the date of redemption, and.upon thirty.(30) days prior written
notice being given by the Paying Agent/Registrar and subject to the terms and provisions relating
thereto contained in the Ordinance. If this Bond is subject to prior redemption and is of a
denomination in excess of$5,000, portions of the principal sum hereof in installments of$5,000
or any integral multiple thereof may be redeemed, and, if less than all of the principal sum hereof
is to be redeemed, upon the surrender of this Bond to the Paying Agent/Registrar at its:corporate
trust office there shall be issued to the Holder hereof, without charge therefor, 'for the then
unredeemed balance of the principal sum hereof, a new Bond or Bonds of like Stated Maturity and
interest rate in any authorized denominations provided by the Ordinance.
If this Bond (or any portion of the principal sum hereof) shall have been duly called for
redemption and notice of such redemption duly given,then upon such redemption date this Bond
(or the portion of the principal sum hereof to be redeemed) shall become due and payable, and if
money for the payment of the redemption price and the interest accrued on the principal amount
to be redeemed to the date of redemption is held for the purpose of such payment by the Paying
Agent/Registrar, interest shall cease to accrue and be payable thereon from and after the.
redemption date on the principal amount scheduled to be redeemed. If this Bond is called for
redemption, in whole or in part, the City or the Paying Agent/Registrar shall not be required to
issue, transfer, or exchange this Bond, within forty-five (45) days from the date fixed for
redemption; provided, however, such limitation of transfer shall not be applicable to an exchange
by the Holder of the unredeemed balance of a Bond that is redeemed in part.
Reference is hereby made to the Ordinance, a copy of.which is on file in the corporate trust
office of the Paying Agent/Registrar, and to all of the provisions of which the Holder by his
acceptance hereof hereby assents, for definitions of terms; the description of and the nature and
extent of the tax levied for the payment of the Bonds; the terms and conditions relating to the
transfer or exchange of the Bonds; the conditions upon which the Ordinance may be amended or
supplemented with or without the consent of the Holders; the rights, duties, and obligations of the
.City and the Paying.Agent/Registrar; the terms and provisions upon which this Bond may be
discharged at or prior to the Stated Maturity thereof, and deemed to be no longer Outstanding
thereunder; and for the other terms and provisions specified in the Ordinance. Capitalized terms
used herein have the same meanings assigned in the Ordinance.
This Bond, subject to certain limitations contained in the Ordinance,may be transferred on
the Security Register upon presentation and surrender at the corporate trust office of the Paying
Agent/Registrar, duly endorsed by, or accompanied by a written instrument of transfer in form
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satisfactory to the Paying Agent/Registrar duly executed by the Holder hereof, or his duly
authorized agent, and thereupon one or more new fully registered Bonds of the same Stated
Maturity,of authorized denominations,bearing the same rate of interest,and of the same aggregate
principal amount will be issued to the designated transferee or transferees.
The City and the Paying Agent/Registrar, and any agent of either, shall treat the Holder
hereof whose name appears on the Security Register (i) on the Record Date as the owner hereof
for purposes of receiving payment of interest.hereon, (ii) on the date of surrender of this Bond as
the owner hereof for purposes of receiving payment of principal hereof at.its Stated Maturity and
on any other date as the owner hereof for all other purposes, and neither the City nor the Paying
Agent/Registrar,or any such agent of either, shall be affected by notice to the contrary.In the event
of anon-payment of interest on a scheduled payment date, and for thirty (30) days thereafter, a
new record date for such interest payment (a Special Record Date) will be established by the
Paying Agent/Registrar, if and when funds for the payment of such interest have been received
from the City. Notice of the Special Record,Date and of the scheduled payment date of the past
due interest(the Special Payment Date - which shall be fifteen(15) days after the Special Record
Date) shall be sent at least five (5)business days prior to the Special Record Date by United States
mail, first-class postage prepaid, to the address of each Holder appearing on the Security Register
at the close of business on the last business day next preceding the date of mailing of such notice.
It is hereby certified, covenanted, and represented that all acts, conditions, and things .
required to be performed, exist, and be done precedent to the issuance of this Bond in order to
render the same a legal, valid, and binding obligation of the City have been performed, exist, and
have been done, in regular and due time, form, and manner, as required by the laws of the State of
Texas and the Ordinance, and that the issuance of the Bonds does not exceed any constitutional or
statutory limitation; and that due provision has been made for the payment of the principal of,
premium if any, and interest on the Bonds by the levy of a tax as aforestated. In case any provision
in this Bond or any application thereof shall be deemed invalid, illegal, or unenforceable, the
validity, legality, and enforceability of the remaining provisions and applications shall not in any
way be affected or impaired thereby. The terms and provisions of this Bond and the Ordinance
shall be construed in accordance with and shall be governed by the laws of the State of Texas.
[The remainder of this page intentionally left blank]
11
IN WITNESS WHEREOF, the City has caused this Bond to be duly executed under its
official seal.
CITY OF CIBOLO, TEXAS
Mayor
ATTEST:.
f� ..
City Secretary
Eli ,, .
[The remainder of this page intentionally left blank] .
DD •Ommmm.eoo•• •
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12
C. *Form of Relzistration Certificate of Comptroller of Public Accounts to Appear
on Initial�Bond Only.
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER OF §
PUBLIC ACCOUNTS §
§ REGISTER NO.
THE STATE OF TEXAS §
I HEREBY.CERTIFY that this Bond has been examined, certified as to validity and
approved by the Attorney General of the State of Texas, and duly registered by the.Comptroller of
Public Accounts of the State of Texas.
WITNESS my signature and seal of office this
Comptroller of Public
Accounts of the
State of Texas
(SEAL)
* Note to Printer: Not to appear on printed Bonds
D. Form of Certificate of Paying Agent/Registrar to Appear on Definitive Bonds
Only..
REGISTRATION CERTIFICATE OF PAYING
AGENT/REGISTRAR
This Bond-has been duly issued under the provisions of the within-mentioned Ordinance;
the Bond or Bonds of the above-entitled and designated series originally delivered having been
approved by the Attorney General of the State of Texas and registered by the Comptroller of Public
Accounts,as shown by the records of the Paying Agent/Registrar.
Registered this date: UMB BANK,N.A..Austin, Texas, as
Paying Agent/Registrar
By:
Authorized Signature
13
E. Form of Assignment.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns, and transfers unto (Print
or typewrite name, address, and zip code of transferee):
(Social Security or other identifying number):
the within Bond and all rights thereunder,-and hereby irrevocably constitutes and appoints
attorney to transfer the within Bond on the books kept for registration
thereof, with full power of substitution in the premises.
DATED
NOTICE: The signature on this assignment must
correspond with the name of the registered owner as it
appears on the face of the within Bond in every
particular.
Signature guaranteed:
s
F. The Initial Bond shall be in the form set forth in paragraph B of this Section,
except that-the form of the single fully registered Initial Bond shall be modified as follows:
(i) immediately under the name of the Bond the headings "Interest Rate"
and"Stated Maturity" shall both be completed"as,shown below
(ii) the first two paragraphs shall read as follows: -
The City of Cibolo, Texas (the City), a body corporate and municipal corporation in the
County of Guadalupe, State of Texas, for value received, acknowledges itself indebted to and
hereby promises to pay to the order of the Registered Owner named above,or the registered assigns
thereof,the Principal Amount specified above stated to mature on the first day of February in each
of the years and in principal amounts and bearing interest at per annum rates in accordance with
the following schedule:
14
Years of Principal Interest
Stated Maturity Amounts ($) Rates
(Information to be inserted from schedule in Section 2 hereof.)
and to pay interest on the unpaid Principal Amount hereof from the Closing Date (anticipated to
occur on or about November 10,2021), or from the most recent Interest Payment Date(hereinafter
defined) to which interest has been paid or duly provided for, to Stated Maturity, while
Outstanding, at the per annum rates of interest specified above computed on the basis of a 360-day
year of twelve 30-day months; such interest being payable on February 1 and August 1 of each
year (each, an Interest Payment Date), commencing February 1, 2022.
Principal of this Bond shall be payable to the Registered Owner hereof(the Holder), upon
its presentation and surrender to Stated Maturity, while Outstanding, at the corporate trust office
of UMB Bank,N.A.,Austin,Texas (the Paying Agent/Registrar)(provided,however,with respect
to principal payments prior to the final Stated Maturity,the Bonds need not be surrendered to the
Paying Agent/Registrar, who will merely document this payment on an internal ledger maintained
by the Paying Agent/Registrar). Interest shall be payable to the Holder of this Bond whose name
appears on the Security Register maintained by the Paying Agent/Registrar at the close of business
on the Record Date, which is the fifteenth day of the month next preceding each Interest Payment
Date. All payments of principal of and interest on this Bond shall be in any coin or currency of the
United States of America which at the time of payment is legal tender for the payment of public
and private debts. Interest shall be paid by the Paying Agent/Registrar by check sent on or prior to
the appropriate date of payment by United States mail, first-class postage prepaid, to the Holder
hereof at the address appearing in the Security Register or by such other method,.acceptable to the
Paying Agent/Registrar, requested by, and at the risk and expense of,the Holder hereof.
G. Insurance Legend. If bond insurance is obtained by the City or the Purchasers
for the Bonds, the Definitive Bonds and the Initial Bond shall bear an appropriate legend as
provided by the insurer.
SECTION 9. Definitions. For all purposes of this Ordinance (as defined below), except as
otherwise expressly provided or unless the context otherwise requires: (i)the terms defined in this
Section have the meanings assigned to them in this Section, and certain terms used in Sections 21
and 37 of this Ordinance have the meanings assigned to them in such Sections, and all such terms
include the plural as well as the singular; (ii) all references in this Ordinance to designated
"Sections" and other subdivisions are to the designated Sections and other subdivisions of this
Ordinance as originally adopted; and(iii)the words"herein", "hereof, and"hereunder"and other
words of similar import refer to this Ordinance as a whole and not to any particular Section or
other subdivision.
The term Authorized Officials shall mean the Mayor, the Mayor Pro Tem, the City
Manager,the Director of Finance, and/or the City Secretary, or any person serving in an interim
or acting capacity in the indicated position.
15
A. The term Bond Fund shall mean the special fund created and established by the
provisions of Section 10 of this Ordinance..
B: The term Bonds shall mean the $ "CITY OF CIBOLO,
TEXAS GENERAL OBLIGATION REFUNDING BONDS, SERIES 2021" authorized by this
Ordinance.
C. The term City shall mean City of Cibolo, located in the County of Guadalupe,
Texas and, where appropriate, the City Council of the City.
D. The term Closing Date shall mean the date of physical delivery of the Initial
Bond in exchange for the payment in full by the Purchasers.
E. The term Debt Service Requirements shall mean, as of any particular date of
computation, with respect to any obligations and with respect to any period, the aggregate of the
amounts to be paid or set aside by the City as of such date or in such period for the payment of the
principal of, premium, if any, and interest (to`the extent not capitalized) on such obligations;
assuming, in the case of obligations without a Mixed numerical rate, that such obligations bear
interest at the maximum rate permitted by the terms thereof and further assuming in the case of
obligations required to be redeemed or prepaid as to principal prior to Stated Maturity,the principal
amounts thereof will be redeemed prior to Stated Maturity inaccordance with the mandatory
redemption provisions, if any, applicable thereto.
F. The term Depository shall mean an official depository bank of the City.
G. The term Government Securities, as used herein,'shall mean(i)direct noncallable
obligations of the United States, including obligations that are unconditionally guaranteed by, the.
United States of America; (ii)noncallable obligations of an agency or instrumentality of the United
States; including obligations that are unconditionally guaranteed or insured by the agency or
instrumentality and that, on the date the governing body 'of the issuer adopts or approves the
proceedings authorizing the issuance of refunding bonds, 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 the governing body of the issuer adopts or
approves the proceedings authorizing the issuance of refunding bonds, are rated as to investment
quality by a nationally recognized 'investment rating firm not less than AAA or its equivalent; or
(iv) any additional securities and,obligations hereafter authorized by the laws of the State of Texas
as eligible for use to accomplish the discharge of obligations such as the Bonds.
I. The term Holder or Holders shall mean the registered owner, whose name-
appears in the Security Register, for any Bond.
J. The term Interest Payment Date shall,mean the date interest is payable on the
Bonds, being February 1 and August l of each year, commencing February 1, 2022, while any of
the Bonds remain Outstanding.
16
K. The term Ordinance shall mean this ordinance adopted.by the City Council of
the City on September 28, 2021.
L. The term.Outstanding when used in this Ordinance with respect to.Bonds shall
mean, as of the date of determination,all Bonds issued and delivered under this Ordinance, except:
(1) those Bonds canceled by the Paying Agent/Registrar or delivered to the Paying
Agent/Registrar for cancellation;-
(2) those Bonds for which payment has been duly provided by the City in accordance
with the provisions of Section 23 of this Ordinance; and
(3) those Bonds that have been mutilated, destroyed,,lost, or stolen and replacement.
Bonds have been registered and delivered in lieu thereof as provided in Section 17 of this
Ordinance.
M. . The term Purchasers shall mean the initial purchasers of the Bonds named in
Section 18 of this Ordinance.
N. The term Refunding Candidates shall mean:
(1) City of'Cibolo, Texas General Obligation Refunding Bonds, Series 2012, dated
December 1., 2012,in the original principal amount of$1,465,000;
(2) City of Cibolo, Texas General Obligation Bonds, Series 2013, dated July 1, 2013,
in the original principal amount of$8,5.00,000;
(3) City of Cibolo, Texas General Obligation Refunding Bonds, Series 2017, dated
November 1, 2017, in the original principal amount of$8,325,000; and
_
.(4) Any other outstanding general or special obligation of'the City hereinafter
identified and selected by an Authorized Official as a candidate presenting an opportunity
advantageous to the City and its residents.
O. The term Stated Maturity shall mean the annual principal payments of the Bonds
payable on February 1 of each year, as set forth in Section 2 of this Ordinance.
SECTION 10. Bond Fund; Investments. For the purpose of paying the interest on and to
provide a sinking fund for the payment, redemption, and retirement of the Bonds, there shall be
and is hereby created.a special fund to.be designated "CITY OF CIBOLO, TEXAS GENERAL
OBLIGATION REFUNDING BONDS; SERIES 2021 INTEREST AND SINKING FUND" (the
Bond Fund), which fund shall be kept and maintained at the Depository, and money,deposited in
such fund shall be used for no other purpose and shall be maintained as provided in Section 21.
Authorized Officials of the City are hereby authorized and directed to make withdrawals from the
Bond Fund sufficient to pay the purchase price or amount of principal of, premium, if any;.and
interest on the Bonds as the same become due and payable and shall cause to be transferred to the
Paying Agent/Registrar from money on deposit in the Bond Fund an amount sufficientto pay the
17
amount of principal and/or interest stated to mature on the Bonds, such transfer of funds to-the
Paying Agent/Registrar.to be made in such manner as will cause immediately available funds to
be deposited with the Paying Agent/Registrar on or before the business day next preceding each
interest and principal payment date for the Bonds.
Pending the transfer of funds to the Paying Agent/Registrar, money deposited in any fund
created and established pursuant to the provisions of this Ordinance, at the option of the City,may
be placed in time deposits, certificates of deposit, guaranteed investment contracts, or similar
contractual agreements as permitted by the..provisions of the Public Funds Investment Act, as
amended,Chapter 2256,Texas Government Code,secured(to-the extent not insured by:the Federal
Deposit Insurance Corporation)by obligations of the type hereinafter described, or be invested, as
authorized by any law, including investments held in book-entry form, in securities.including, but
not limited to,direct obligations of the United States of America, obligations guaranteed or insured
by the United States of America, which, in the opinion of the Attorney General of the United
States, are backed by its full faith and credit or represent its general obligations, or invested in
indirect obligations of the United States of America, including, but not limited to, evidences'of
indebtedness issued, insured or guaranteed by such governmental agencies as the Federal Land
Banks, Federal Intermediate Credit Banks, Banks for Cooperatives, Federal Home Loan Banks,
Government National Mortgage Association, Farmers Home Administration, Federal Home Loan
Mortgage Association, Small Business Administration, or Federal Housing Association;provided
that all such deposits and investments shall be made in such a manner that the money required to
be expended from such fund will be available at the proper time'or times. All interest and income
derived from deposits and investments in such fund shall be credited to, and any losses debited to,
such fund. All such investments shall be sold promptly when necessary to prevent any default in
connection with the Bonds.
SECTION 11. Tax Lew. To provide for the payment of the Debt Service Requirements on
the Bonds being (i)the interest on the Bonds and (ii) a sinking fund for their redemption at Stated
Maturity or a sinking fund of 2% (whichever amount shall be the greater),there shall be and there
is hereby levied for the current year and each succeeding year thereafter while the Bonds or any
interest thereon shall remain Outstanding,a sufficient tax,within the limitations prescribed by law,
on each one hundred dollars' valuation of taxable property in the City, adequate to pay such Debt
Service Requirements, full allowance being made for delinquencies and costs of collection; said
tax shall be assessed and collected each year and applied to the payment of the Debt Service
Requirements, and the same shall not be diverted to any other purpose. The taxes so levied and
collected shall be paid into the Bond Fund and are thereafter pledged to the payment of the Bonds.
The City Council hereby declares its purpose and intent to provide and levy a tax legally and fully
sufficient to pay such Debt Service Requirements, it having been determined that the existing and
available taxing-authority of the City for such purpose is adequate to permit a legally sufficient tax
in consideration of all other outstanding indebtedness and other obligations of the City.
SECTION 12. Deposits to Bond Fund; Surplus.Bond Proceeds. The City hereby,covenants
and agrees to cause to be deposited in the-Bond Fund prior to a principal and interest payment date
for the Bonds, from the annual levy of an ad valorem tax or from other lawfully available funds,
amounts sufficient to fully-pay and-discharge promptly each installment of interest and principal
of the Promises as the same accrues or matures or comes due by reason of Stated Maturity.
18
Any taxes collected pertaining to the Refunded Obligations, after the Closing Date, shall
be deposited to the Bond Fund. In addition, any surplus proceeds from the sale of the Bonds,
including investment income thereon,.not expended for authorized purposes shall be deposited in.
the Bond Fund, and such amounts so deposited shall reduce the sums otherwise required to be
deposited in said fund from ad valorem taxes.
SECTION 13. Security of Funds. All money on deposit in the funds for which this
Ordinance makes provision(except any portion thereof as may be at any time properly invested as
provided herein) shall be secured in the manner and to the fullest extent required by the laws of
the State of Texas for the security of public funds, and money on deposit in such funds shall be
used only for the purposes permitted by this Ordinance.
SECTION 14. Remedies in Event of Default. In addition to all the rights and remedies
provided by the laws of the State of Texas, the City covenants and agrees particularly that in the
event the City (a) defaults in the payments to be made to the Bond Fund or (b) defaults in the
observance or performance of any other of the covenants, conditions, or obligations set forth in
this Ordinance,the 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.
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 15.Notices to Holders; Waiver. Wherever this Ordinance provides for notice to
Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and sent by United States mail, first-class postage prepaid, to the address
of each Holder appearing in the Security Register at the close of business on the business day next
preceding the mailing of such notice.
In any case where notice to Holders is given by mail,neither the failure to mail such notice
to any particular Holders, nor any defect in any notice so mailed, shall affect the sufficiency of
such notice with respect to all other Holders. Where this Ordinance provides for notice in any
manner, such notice may be waived in writing by the Holder entitled to receive such notice, either
before or after the event with respect to which such notice is given, and such waiver shall be the
equivalent of such notice. Waivers ' of notice by Holders shall be filed with the Paying
Agent/Registrar, but such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
SECTION 16. Cancellation. All Bonds surrendered for payment, redemption, transfer,
exchange,or replacement,if surrendered to the Paying Agent/Registrar,shall be promptly canceled
by it and, if surrendered to the City, shall be delivered to the Paying Agent/Registrar and, if not
already canceled, shall be promptly canceled by the Paying Agent/Registrar. The City may at any
time deliver to the Paying Agent/Registrar for cancellation any Bonds previously certified or
19
registered and delivered which the City may have acquired in any manner whatsoever, and all
Bonds so delivered shall be promptly canceled by the Paying Agent/Registrar.All canceled Bonds
.held by the Paying.Agent/Registrar shall be destroyed as directed by the City.
SECTION 17. Mutilated,.Destroyed, Lost, and Stolen Bonds. If:(I) any mutilated Bond is
surrendered to the Paying Agent/Registrar, or the City and the Paying Agent/Registrar receive
evidence to their satisfaction of the destruction,loss,or theft.of any Bond,and(2)there is delivered
to the.City and the Paying Agent/Registrar such security or indemnity as may be required to save
each of them harmless,,then,in the absence of notice to the City or the Paying Agent/Registrar that
such Bond has been acquired by a bona fide purchaser,the City shall execute and,upon its request,
the Paying Agent/Registrar shall register and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost, or stolen Bond, a new Bond of the same Stated Maturity and interest
rate and of like tenor and principal amount,bearing a number not contemporaneously Outstanding.
In case any such mutilated, destroyed, lost, or stolen Bond has become or is about to
become due and payable, the City in its discretion may, instead of issuing a new Bond, pay such
Bond.
Upon the issuance of any new Bond or payment in lieu thereof,under this Section,the City
may require.payment by the Holder of a sum sufficient to cover any tax or other governmental
charge imposed in relation thereto and any other expenses and charges (including attorney's fees
and the fees and expenses of the Paying Agent/Registrar) connected therewith.
Every new Bond issued pursuant to this Section in lieu of any mutilated, destroyed, lost,
or stolen Bond shall constitute a replacement of the prior obligation of the City,whether or not the
mutilated, destroyed, lost, or stolen Bond shall be at any time.enforceable by anyone, and shall be
entitled to all the benefits of this Ordinance equally and ratably with all other Outstanding Bonds.
The provisions of this Section are exclusive and shall preclude (to the extent lawful) all
other rights and remedies with respect to the replacement and payment of mutilated, destroyed, .
lost, or stolen Bonds.
SECTION 18. Bonds—Authorization of an Official Bid Form—Approval of the Official
Statement - Use of Bond Proceeds. The Bonds authorized by this Ordinance are hereby sold by
the City. to , as .the as the authorized
representative of a group of underwriters at a competitive sale (the Purchasers, :having all the
rights, benefits, and obligations of a Holder) in accordance with the provisions:of an Official Bid
Form (the Official Bid Form), dated , 2021, attached hereto as Exhibit B and
incorporated herein by reference as a part of this Ordinance for all purposes, at a price of par,plus
a [net] reoffering premium of$ less the Purchasers' compensation of$ )
and no accrued interest. The Initial Bond shall be registered in the name of It is
hereby officially found, determined, and declared that the Purchasers are the lowest bidder for the
Bonds and as:a result of invitations for competitive bids in compliance with applicable law. The
pricing and terms of the sale of the Bonds are hereby found and determined to be the most
advantageous reasonably obtainable by the City.
20
Furthermore, the City hereby ratifies, confirms, and approves in all respects (i) the City's
prior determination that the Preliminary Official Statement was, as of its date, "deemed final" in
accordance with the Rule (hereinafter defined) and (ii) the use and,distribution of the Preliminary
Official Statement by the Purchasers in connection with the public offering and sale of the Bonds.
The final Official Statement, being a modification and amendment of the Preliminary Official
Statement to reflect the terms of sale (together with such changes approved by any Authorized
Official), shall be and is hereby in all respects approved and the Purchasers are hereby authorized
to use and distribute the final Official Statement, dated , 2021, in the reoffering,
sale and delivery of the Bonds to the public. The Mayor and of City Secretary of the Governing.
Body are further authorized and directed to manually, facsimile, or electronically execute and
deliver for and on behalf of the Issuer copies of the Official Statement in final form as may be
required by the Purchasers, and such final Official Statement in the form and content manually,
facsimile, or electronically executed by said officials shall be deemed to be approved by the
Governing Body and constitute the Official Statement authorized for distribution and use by the
Purchasers. The proper officials of the City are hereby authorized to execute and deliver a
certificate pertaining to such Official Statement as prescribed therein, dated as of the date of
payment for and delivery of the Bonds.
SECTION 19. Escrow Deposit Letter, Approval and Execution, Proceeds of Sale,
Contribution by the City_. The Escrow Deposit Letter dated as of September 28, 2021 to be
effective upon the initial delivery of the Bonds to the Purchasers (the Escrow Agreement)between
the City and UMB Bank, N.A., Austin, Texas (the Escrow Agent), attached hereto as Exhibit C
and incorporated herein by reference as a part of this Ordinance for all purposes, is hereby
approved as to form and content, and such Escrow Agreement in substantially the form and
substance attached hereto, together with such changes or revisions as may be necessary to
accomplish the refunding or benefit the City,is hereby authorized to be executed by an Authorized
Official on behalf of the City and as the act and deed of this City Council; and such Escrow
Agreement as executed by said officials shall be deemed approved by the City Council and
constitute the Escrow Agreement herein approved.
Furthermore, any Authorized Official and Bond Counsel in cooperation with the Escrow
Agent are hereby authorized and directed to make the necessary arrangements for the purchase of
the Escrowed Securities referenced in the Escrow Agreement and the initial delivery thereof to the
Escrow Agent on the day of delivery of the Bonds to the Purchasers for deposit to the credit of the
"CITY OF CIHOLO, TEXAS GENERAL OBLIGATION REFUNDING BONDS, SERIES 2021
ESCROW FUND" (the Escrow Fund, including the execution of the subscription forms for the
purchase and issuance of the "United States Treasury Securities - State and Local Government
Series",if any,for deposit to the Escrow Fund; all as contemplated and provided by the provisions
of the Act,this Ordinance, and the Escrow Agreement.
Immediately following the delivery of the Bonds,the proceeds of sale thereof, along with
a cash contribution, if any, from the City (less certain costs of issuance and accrued interest
received from the Purchasers of the Bonds), shall be deposited with the Escrow Agent for
application and disbursement in accordance with the provisions of the Escrow Agreement. The
proceeds of sale of the Bonds not so deposited with the Escrow Agent for the refunding of the
Refunded Obligations shall be disbursed for payment of costs of issuance and deposited with the
place of payment of the Refunded Obligations in an account in the name of the City and applied
21
for the purposes of providing for the payment of the costs and expenses incurred in connection
therewith or deposited in the Bond Fund for the Bonds, all in accordance with written instructions
from any Authorized Official.
SECTION 20. Redemption of Refunded Obligations. The Refunded Obligations
referenced in the preamble hereof become subject to redemption prior to their stated maturities at
the price of par, premium, if any, and accrued interest to the date of redemption. The Mayor or
City Secretary shall give written notice to the paying agent/registrar for the Refunded Obligations
and the Escrow Agent that the Refunded Obligations have been called for redemption, and the City
Council orders that such obligations are called for redemption on the date set forth on Schedule I
attached to this Ordinance, and such order to redeem the Refunded Obligations on such date shall
be irrevocable upon the delivery of the Bonds. A copy of the notices of redemption pertaining to
the Refunded Obligations is attached to this Ordinance as Exhibit D and is incorporated herein by
reference for all purposes. The paying agent for the Refunded Obligations is authorized and
instructed to provide the notices of these redemptions to the holders of the Refunded Obligations
in the form and manner described in the ordinances authorizing the issuance of the Refunded
Obligations.
SECTION 21. Covenants to Maintain Tax-Exempt Status.
(a) Covenants. The Issuer 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 Issuer 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 or the projects financed therewith are so used, such
amounts, whether or not received by the Issuer, 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;
22
(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 3
years or less or, in the case of a refunding bond,for a period of 90 days 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),-
(8)
rbitrage);(8) to refrain from using the proceeds of the Bonds or proceeds of any prior bonds
to pay debt service on another issue more than 90 days after the date of issue of the Bonds
in contravention of the requirements of section 149(d) of the Code (relating to advance
refundings); and
(9) 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.
(b) Rebate Fund. In order to facilitate compliance with the above covenant (8), a
"Rebate Fund" is hereby established by the Issuer 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.
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(c) Proceeds. The Issuer 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 and any replacement funds. It is the understanding of the Issuer 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 Issuer.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 Issuer 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 Issuer hereby authorizes and directs
any member of the City Council and any Authorized Official to execute any documents,
certificates or reports required by the Code and to make such elections, on .behalf of the Issuer,
which may be 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 Issuer
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 (the Project) on its books and records in
accordance with the requirements of the Internal Revenue Code. The Issuer 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 Issuer recognizes that in order
for proceeds to be expended under the Internal Revenue Code, the sale proceeds or 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 Issuer 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 issuer 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) Disposition of Project. The Issuer covenants that the property constituting the
Project will not be sold or otherwise disposed in a transaction resulting in the receipt by the Issuer
of cash or other compensation, unless any action taken in connection with such disposition will
not adversely affect the tax-exempt status of the Bonds. For purpose of the foregoing, the Issuer
may rely on an opinion of nationally-recognized bond counsel that the action taken in connection
with 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 Issuer shall not be obligated to comply with this
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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.
(g) Written Procedures. Unless superseded by another action of the Issuer, to ensure
compliance with the covenants contained herein regarding private business use, remedial actions,
arbitrage and rebate, the City Council hereby adopts and establishes the instructions attached
hereto as Exhibit H as the Issuer's written procedures.
SECTION 22. Control and Custody of Bonds.The Mayor shall be and is hereby authorized
to take and have charge of all necessary orders and records pending investigation by the Attorney
General of the State of Texas and shall take and have charge and control of the Bonds pending
their approval by the Attorney General, the registration thereof by the Comptroller of Public
Accounts and the delivery of the Bonds to the Purchasers.
Furthermore, any Authorized Official, either or all, are hereby authorized and directed to
furnish and execute such documents relating to the City and its financial affairs as may be
necessary for the issuance of the Bonds,the approval of the Attorney General and their registration
by the Comptroller of Public Accounts and, together with the City's financial advisors, Bond
Counsel, and the Paying Agent/Registrar, make the necessary arrangements for the delivery of the
Initial Bond to the Purchasers and the initial exchange thereof for definitive Bonds.
SECTION 23. Satisfaction of Obligation of City. If the City shall pay or cause to be paid,
or there shall otherwise be paid to the Holders, the principal of, premium, if any, and interest on
the Bonds, at the times and in the manner stipulated in this Ordinance, then the pledge of taxes
levied under this Ordinance and all covenants, agreements, and other obligations of the City to the
Holders shall thereupon cease, terminate, and be discharged and satisfied.
Bonds, or any principal amount(s) thereof, shall be deemed to have been paid within the
meaning and with the effect expressed above in this Section when (i) money sufficient to pay in
full such Bonds or the principal amount(s)thereof on.or prior to Stated Maturity,together with all
interest due thereon, shall have been irrevocably deposited with and held in trust by the Paying
Agent/Registrar, or an authorized escrow agent, and/or(ii) Government Securities shall have been
irrevocably deposited in trust with the Paying Agent/Registrar, or an authorized escrow agent,
which Government Securities mature as to principal and interest in such amounts and at such times
as will insure the availability,without reinvestment, of sufficient money,together with any money
deposited therewith, if any, to pay when due the principal of and interest on such Bonds, or the
principal amount(s) thereof, at the Stated Maturity thereof. In the event of a defeasance of the
Bonds, the City shall deliver a certificate from its financial advisor, the Paying Agent/Registrar,
an independent accounting firm, or another qualified third parry concerning the deposit of cash
and/or Government Securities to pay, when due, the principal of, redemption premium (if any),
and interest due on any defeased Bonds.As and to the extent applicable,if at all,the City covenants
that no deposit of money or Government Securities will be made under this Section and no use
made of any such deposit which would cause the Bonds to be treated as arbitrage bonds within the
meaning of section 148 of the Code (as defined in Section 21 hereof).
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Any money so deposited with the Paying Agent/Registrar, and all income from
Government Securities held in trust by the Paying Agent/Registrar, or an authorized escrow agent,
pursuant.to this Section which is not required for the payment of the Bonds, or any principal
amount(s) thereof, or interest thereon with respect to which such money has been so deposited
shall be remitted to the City or deposited as directed by the City. Furthermore, any money held by
the Paying Agent/Registrar for.the payment of the principal of and interest on the Bonds and.
remaining unclaimed for a period of three (3) years after the Stated Maturity of the Bonds, such
money was deposited and is held in trust to pay shall upon the request of the City be remitted to
the City against a written receipt therefor, subject to the unclaimed property laws of the State of
Texas.
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(i) or(ii) above shall not be irrevocable,provided that: (1)in
the proceedings providing for such defeasance, 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 defeasance; (3)directs that notice of the reservation
be included in any redemption notice that it authorizes; and (4) at the time of the redemption,
satisfies the conditions of(i)or(ii)above with respect to such defeased debt as though it was being
defeased at the time of the exercise of the option to redeem the defeased Bonds, after taking the
redemption into account in determining the sufficiency of the provisions made for the payment of
the defeased Bonds.
SECTION 24.Printed Opinion. The Purchasers' obligation to accept delivery of the Bonds
is subject to its being furnished a final opinion of McCall,Parkhurst&Horton L.L.P.,San Antonio,
Texas, as Bond Counsel, approving certain legal matters as to the Bonds, said opinion to be dated
and delivered as of the date of initial delivery and payment for such Bonds. Printing of a true and.
correct copy of said opinion on the reverse side of each of the Bonds, with appropriate certificate
pertaining thereto executed by facsimile signature of the City Secretary of the City is hereby
approved and authorized.
SECTION 25. CUSIP Numbers. CUSIP numbers may be printed or typed on the definitive
Bonds. It is expressly provided, however, that the presence or absence of CUSIP numbers on the
definitive Bonds shall be of no significance or effect as regards the legality thereof, and neither
the City nor attorneys approving said Bonds as to legality are to be held responsible for CUSIP
numbers incorrectly printed or typed on the definitive Bonds.
SECTION 26. Effect of Headings. The Section headings herein are for convenience only
and shall not affect the construction hereof.
SECTION 27. Ordinance a. Contract. Amendments - Outstanding Bonds. The City
acknowledges that the covenants and obligations of the City herein contained are a material
inducement to the purchase of the Bonds. This Ordinance shall constitute a contract with the
Holders from time to time, shall be binding on the City and its successors and assigns, and shall
not be amended or repealed by-the City so long as any Bond remains.Outstanding except as
permitted in this Section. The City may,without the consent of or notice to any Holders, from time
to time and at any time, amend this Ordinance in any manner not detrimental to the interests of the
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Holders,including the curing of any ambiguity,inconsistency,or formal defect or omission herein.
In addition, the City may, with the written consent of Holders holding a majority in aggregate
principal amount of the Bonds then Outstanding affected thereby, amend, add to, or rescind any of
the provisions of this Ordinance; provided; however, that, without the consent of all Holders of
Outstanding Bonds, no such amendment, addition, or rescission shall (1) extend the time or times
of payment of the principal of, premium, if any, and interest on the Bonds, reduce the principal
amount thereof, the redemption price thereof, or the rate of interest thereon, or in any other way
modify the terms of payment of the principal of, or interest on the Bonds, (2) give any preference
to any Bond over any other Bond,or(3)reduce the aggregate principal amount of Bonds required
for consent to any such amendment, addition, or rescission.
SECTION 28. Benefits of Ordinance. Nothing in this Ordinance, expressed or implied, is
intended or shall be construed to confer upon any person other than the City,Bond Counsel,Paying
Agent/Registrar, and the Holders, any right, remedy, or claim, legal or equitable, under or by
reason of this Ordinance or any provision hereof, this Ordinance and all its provisions being
intended to be and being for the sole and exclusive benefit of the City, Bond Counsel, the Paying
Agent/Registrar, and the Holders.
SECTION 29. Inconsistent Provisions. All ordinances and resolutions, or parts thereof,
which are in conflict or inconsistent with any provision of this Ordinance are hereby repealed to
the extent of such conflict, and the provisions of this Ordinance shall be and remain controlling as
to the matters ordained herein.
SECTION 30. Construction of Terms. If appropriate in the context of this Ordinance,
words of the singular number shall be considered to include the plural,words of the plural number
shall be considered to include the singular, and words of the masculine, feminine or neuter gender
shall be considered to include the other genders.
SECTION 31. Governing Law. This Ordinance shall be construed and enforced m
accordance with the laws of the State of Texas and the United States of America.
SECTION 32. Incorporation of Preamble Recitals. The recitals contained in the preamble
hereof are hereby found to be true, and such recitals are hereby made a part of this Ordinance for
all purposes and are adopted as a part of the judgment and findings of the City Council.
SECTION 33. Authorization of Paving Agent/Registrar Agreement. The City Council of
the City hereby finds and determines that it is in the best interest of the City to authorize execution
of, and hereby authorized an Authorized Official to execute, a Paying Agent/Registrar Agreement
concerning the payment, exchange, registration, and transferability of the Bonds. A copy of the
Paying Agent/Registrar Agreement is attached hereto,in substantially final form, as Exhibit A and
is incorporated by reference to the provisions of this Ordinance.
SECTION 34. Public Meeting. It is officially found, determined, and declared that the
meeting at which this Ordinance is adopted was open to the public and public notice of the time,
place, and subject matter of the public business to be considered at such meeting, including this
Ordinance, was given, all as required by Chapter 551, as amended, Texas Government Code.
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SECTION 35. Unavailability of Authorized Publication. If, because of the.temporary or
permanent suspension of any newspaper, journal, or other publication, or, for any reason,
publication of notice cannot be made meeting any requirements herein established, any notice
required to be published by the provisions of this Ordinance shall be given in such other manner
and at such time or times as in the judgment of the City or of the Paying Agent/Registrar shall
most effectively approximate such required publication and the giving of such notice in such
manner shall for all purposes of this Ordinance be deemed to be in compliance with the
requirements for publication thereof.
SECTION 36. No Recourse Against City Officials. No recourse shall be had for the
payment of principal of, premium, if any, or interest on any Bond or for any claim based thereon
or on this Ordinance against any official of the City or any person executing any Bond.
SECTION 37. Continuing Disclosure Undertaking_
A. Definitions.
As used in this Section, the following terms have the meanings ascribed to such terms
below:
EMMA means the MSRB's Electronic Municipal Market Access system, accessible by the
general public, without charge, on the internet through the uniform resource locator (URL)
http://www.emma.msrb.org.
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.
Undertaking means the City's continuing disclosure undertaking, described in Paragraphs
B through E below,hereunder accepted and entered into by the City for the purpose of compliance
with the Rule.
B. Annual Reports.
The City shall file annually with the MSRB, within twelve months after the end of each
fiscal year ending in or after 2021, financial information and operating data with respect to the.
City of the general type included in the final Official Statement authorized by Section 17 of this
Ordinance being the information described in Exhibit F hereto and if not provided as part of such
financial information and operating data, audited financial statements of the City, when and if
available. Any financial statements so to be-provided shall be (i) prepared in accordance with the
accounting principles described in Exhibit F 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 (ii) audited,
if the City commissions an audit of such financial 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 unaudited financial statements within such period
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and audited financial statements for the applicable fiscal year to the MSRB,when and if the.audit
report on such statements becomes available. Under current Texas law, including, but not limited
to, Chapter 103, as amended, Texas Local Government Code, the City must have its records and.
accounts audited annually and shall have an annual financial statement prepared based on the audit.
The annual financial statement, including the auditor's opinion on the statement, shall be filed in
the office.of the City Secretary within 365 days after the last day; of the City's fiscal year.
Additionally,.upon the filing of this financial statement and the annual audit,these documents are
subject to the Texas Open Records Act, as amended, Texas Government Code, Chapter 552.
If the City changes its fiscal year, it will file notice thereof with the MSRB of the change
(and of the date of the new fiscal year end) prior to the next date by which the City otherwise
would be required to provide financial information and operating data pursuant to this Section.
C. - Notice of Certain Events.
The City shall file notice of any of the following events with respect to the Bonds to the
MSRB in a timely manner and not more than 10 business days after occurrence of the event:
(1) Principal and interest payment delinquencies;
(2) Non-payment related defaults, if material;
(3) Unscheduled draws on debt service reserves reflecting financial difficulties;
(4) Unscheduled draws on credit enhancements reflecting financial difficulties;
(5) Substitution of credit or liquidity providers, or their failure to perform;
(6) Adverse tax opinions, the issuance by: the Internal Revenue Service of
proposed or final determinations of taxability,Notices of Proposed Issue (IRS Form 5701-
TEB), or other material notices or determinations with respect to the tax status of the
Bonds, or other material events affecting the tax status of the Bonds;
(7) Modifications to rights of holders of the Bonds, if material;
(8) Bond calls, if material, and tender offers;
(9) Defeasances;
(10) Release, substitution, or sale of property securing payment of the Bonds, if .
material;
(11) Rating changes;
(12) Bankruptcy, insolvency, receivership, or similar event of the. City, which
shall occur as described below;
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(13) The consummation of a merger, consolidation, or acquisition involving the
City or the sale of all or substantially.all of its assets, other than in the ordinary course of
business, the entry into of a 1 definitive. agreement to undertake such an action or the
termination of a definitive agreement relating to any such actions, other than pursuant to
its terms, if material;
(14) Appointment of a.successor or additional paying agent/registrar or the
change of name of a paying agent/registrar, if material;
(15) Incurrence of a Financial Obligation of the Issuer, if material, or agreement
to covenants, events of default, remedies, priority rights, or other similar terms of a
Financial Obligation of the Issuer, any of which affect security holders, if material; and
(16) Default, event of acceleration, termination event, modification of terms,.or
other similar events under,the terms of a Financial Obligation of the Issuer, any of which
reflect financial difficulties.
For these purposes, (a) any event described in the immediately preceding paragraph(12)is
considered to occur when any of the following occur: the appointment of a receiver, fiscal agent,
or similar officer for the Issuer in a proceeding under the United States Bankruptcy Code or in any
other proceeding under state or federal law in which a court or governmental authority has assumed
jurisdiction over substantially all of the assets or business of the Issuer, or if such jurisdiction has
been assumed by leaving the existing governing body and officials or officers in possession but
subject to the supervision and orders of a court or governmental authority, or the entry of an order
confirming a plan of reorganization, arrangement, or liquidation by a court or governmental
authority having supervision or jurisdiction over substantially all of the assets or business of the
Issuer, and.(b)the Issuer intends the words used in the immediately preceding paragraphs (15) and,
(16) and the definition of Financial Obligation in this Section have the same meanings as when
they are used in the Rule, as evidenced by SEC Release No. 34-83885, dated August 20, 2018.
The City shall file notice with the MSRB, in a timely manner, of any failure by the City to
provide financial information or operating data in accordance with this Section by the time
required by this Section.
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 that causes the Bonds to be no longer 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.
30
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 BOND OR ANY OTHER PERSON, IN CONTRACT OR
TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY
THE CITY, WHETHER NEGLIGENT OR WITH OR WITHOUT FAULT ON ITS PART, OF
ANY COVENANT SPECIFIED IN THIS SECTION,BUT EVERY RIGHT AND REMEDY OF
ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH
BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC
PERFORMANCE.
No default by the City in observing or performing its obligations under this Section shall
constitute a breach of or default under this Ordinance for purposes of any other provision of this
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 to the date of such amendment, 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) determines that such
amendment will not materially impair the interests of the Holders and beneficial owners of the
Bonds. The City may also repeal or amend the provisions of this Section if the SEC amends or
repeals the applicable provisions of the Rule or any court of final jurisdiction enters judgment that
such provisions of the Rule are invalid, and the City also may amend the provisions of this Section
in its discretion in any other manner,or circumstance, but in either case only if and to the extent
that the provisions of this sentence would not have prevented an underwriter from lawfully
purchasing or selling Bonds in the primary .offering of the Bonds, giving effect to (a) such
provisions as so amended and (b) any amendments or interpretations of the Rule. 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 subsection B of this Section an explanation, in
narrative form, of the reasons for the amendment and of the impact of any change in the type of
financial information or operating data so provided. If the City so amends the provisions of this
Section, the City shall include with any amended financial information or operating data next
provided in accordance with this Section an explanation, in narrative form, of the reasons for the
amendment and of the impact of any change in the type of financial information or operating data
so provided.
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E. Information Format--Incorporation by Reference.
The City information required under this Section shall be filed with the MSRB through
EMMA in such format and accompanied by such identifying information as may be specified from
time to time thereby. Under the current rules of the MSRB, continuing disclosure documents
submitted to EMMA must be in word-searchable portable document format(PDF)files that permit
the document to be saved,viewed,printed, and retransmitted by electronic means and,the series of
obligations to which such continuing disclosure documents relate must be identified by CUSIP
number or numbers.
Financial information and operating data to be provided pursuant to this Section 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)available to the public through EMMA
or filed with the SEC.
F. General Policies and Procedures Concerning Compliance with the Rule.
Because the issuance of the Bonds is subject to the provisions of the Rule and-because the
potential"underwriters"in a competitive sale of the Bonds or the initial purchasers in a competitive
sale of the Bonds may be subject to MSRB rules and regulations with respect to such sale
(including certain due diligence and suitability requirements, among others), the Issuer hereby
adopts the General Policies and Procedures Concerning Compliance with the Rule (the Policies
and Procedures), attached hereto as Exhibit G, with which the Issuer shall follow.to assure
compliance with the Undertaking. The Issuer has.developed these Policies and Procedures for the
purpose of meeting its requirements.of the Undertaking and, in connection therewith, has sought
the guidance from its internal staff charged with administering the Issuer's financial affairs, its
municipal or financial advisors,its legal counsel(including its Bond Counsel),and its independent
accountants (to the extent determined to be necessary or advisable). The Policies and Procedures
can be amended at the sole discretion of the Issuer and any such amendment will not be deemed
to be an amendment to the Undertaking. Each Authorized Official is hereby authorized to amend
the Policies and Procedures as a result of a change in law,a future issuance of indebtedness subject
to the Rule, or another purpose determined by the Authorized Official to be necessary or desirable
for or with respect to future compliance with the Undertaking.
SECTION 38. Book-Entry OnlSystem.
The Bonds shall initially be registered so as to participate in a securities depository system -
(the DTC System) with the Depository Trust Company,.New York, New York, or any successor
entity thereto (DTC), as set forth Herein. Each Stated Maturity of the Bonds shall be -issued
(following cancellation of the Initial Bond described in Section 1) in the form of a separate single
definitive Bond. Upon issuance, the ownership of each such Bond shall be registered in the name
of Cede& Co., as the nominee of DTC, and all of the Outstanding Bonds shall be registered in the
name of Cede & Co.,. as the nominee of DTC. The City and the Paying Agent/Registrar are
authorized to execute, deliver, and take the actions set forth in such letters to'or agreements with.
DTC as shall be necessary to effectuate the DTC System, including the Letter of Representations
attached hereto as Exhibit (the Representation Letter).
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With respect to the 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 broker-dealer,
bank, or other financial institution for which DTC holds the Bonds from time to time as securities
depository (a Depository Participant) or to any person on behalf of whom such a Depository
Participant holds an interest in the Bonds (an Indirect Participant). 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 Depository Participant with respect to any ownership interest in the Bonds, (ii)the delivery to
any Depository Participant or any other person, other than a registered owner of the Bonds, as
shown on the Security.Register, of any notice with respect to the Bonds, including any notice of
redemption, or (iii) the delivery to any Depository Participant or any Indirect Participant or any
other Person, other than a Holder of a Bond, of any amount with respect to principal of,premium,
if any, or interest on the Bonds. While in the DTC System, no person other than Cede & Co., or
any successor thereto, as nominee for DTC, shall receive a bond certificate evidencing the
obligation of the City to make payments of principal,premium,if any, 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 or drafts being mailed to the Holder,
the word "Cede & Co."in this Ordinance shall refer to such new nominee of DTC.
In the event that (a) the City determines that DTC is incapable of discharging its
responsibilities described herein and in the Representation Letter, (b) the Representation Letter
shall be terminated for any reason, or (c) DTC or the City determines 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
notify the Paying Agent/Registrar,DTC, and the Depository Participants of the availability within
a reasonable period of time through DTC of bond certificates, and the Bonds shall no longer be
restricted to being registered in the name of Cede & Co., as nominee of DTC. At that time, the
City may determine that the Bonds shall be registered in the name of and deposited with a
successor depository operating a securities depository system, as may be acceptable to the City, or
such depository's agent or designee, and if the City and the Paying Agent/Registrar do not select
such alternate securities depository system then the Bonds may be registered in whatever name or
names the Holders of Bonds transferring or exchanging the Bonds shall designate, in accordance
with the provisions hereof.
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 of DTC,all payments with respect to principal
of, premium, if any, 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.
SECTION 39. Further Procedures. The officers and employees of the City are hereby
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 initial
sale and delivery of the Bonds,the Paying Agent/Registrar Agreement,the Purchase Contract,the
Official Statement, and the Escrow Agreement. In addition, prior to the initial delivery of the
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Bonds, any Authorized Official and.Bond Counsel are hereby.authorized and directed to approve
any technical changes or corrections 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, (ii)
obtain a rating from any of the national bond rating agencies; or (iii) obtain the approval of the
Bonds by the Texas Attorney General's office.In case any officer of the City whose signature shall
appear on any certificate shall cease to be such officer before the delivery of such certificate, such
signature shall nevertheless be valid and sufficient for all purposes the same as if such officer had
remained in office until such delivery.
SECTION 40. City's Consent to Provide Information and Documentation to the Texas
MAC. The Municipal Advisory Council of Texas (the Texas AMC), a non-profit membership
.corporation organized exclusively for non-profit purposes described in section 501(c)(6) of the
Internal Revenue Code and which serves as a comprehensive financial information repository
regarding municipal debt issuers in Texas, requires provision of written documentation regarding
the issuance of municipal debt by the issuers thereof. In support of the purpose of the Texas MAC
and in compliance with applicable law,the City hereby consents to and authorizes any Authorized
Official, Bond Counsel to the City, and/or Financial Advisor to the City to provide to the Texas
MAC information and documentation requested by the Texas MAC relating to the Bonds;
provided, however, that no such information and documentation shall be provided prior to the
Closing Date. This consent and authorization relates only to information and documentation that
is a part of the public record concerning the issuance of the Bonds.
SECTION 41. Delegation Authorization Pursuant to HB 1295. Though such parties may
be identified, and the entry into a particular form of contract may be authorized herein, pursuant
to the Act, and any other applicable law,the City Council,pursuant to the Act and other applicable
law, hereby delegates to any Authorized Official that is not a member of the City Council, the
authority to independently select the counterparty to any paying agent/registrar, rating agency,
bond insurer, securities depository, escrow agent, open market securities bidding agent, or any
other contract that is determined by the foregoing,the City's Financial Advisor, or the City's Bond
Counsel to be necessary or incidental to the issuance of the Bonds as long as each of such contracts
has a value of less than the amount referenced in Section 2252.908 of the Texas Government Code
(collectively, the Ancillary Bond Contracts) and, as necessary, to execute the Ancillary Bond
Contracts on behalf and as the act and deed of the City. The City Council has not participated in
the selection of any of the business entities which are counterparties to the Ancillary Bond
Contracts.
SECTION 42 Severability. If any provision of this Ordinance or the application thereof to
any person or circumstance shall be held to be invalid, the remainder of this Ordinance and the
application of such provision to other persons and circumstances shall nevertheless be valid, and
the City Council hereby declares that this Ordinance would have been enacted without such invalid
provision.
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SECTION 43. Effective Date:Pursuant to the provisions of Section 1201.028,as amended,
Texas Government Code, this Ordinance shall be effective immediately upon adoption,
notwithstanding any provision in the City's Home Rule Charter to the contrary concerning a
multiple reading requirement for the adoption of ordinances.
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PASSED, APPROVED AND ADOPTED on the 28th day of September, 2021. `
CITY OF CIBOLO, TEXAS
Stosh Boyle,Mayor
ATTEST:
Peggy Cimics, City Secretary
I .
l
S-1
INDEX TO SCHEDULE AND EXHIBITS
Schedule I...............Table of Refunded Obligations
Schedule II .............Approval Certificate
Exhibit A................Paying Agent/Registrar Agreement
Exhibit B ................Official Bid Form
Exhibit C ...............Escrow Deposit Letter
Exhibit D................Notice of Redemption
Exhibit E ................DTC Letter of Representations
Exhibit F.:....:..........Description of Annual Financial Information
Exhibit G................General Policies and Procedures Concerning Compliance with the Rule
Exhibit H................Written Procedures—Compliance with Federal Tax Covenants
Index
Schedule I
Refunded Obligations
1. City of Cibolo, Texas General Obligation Refunding Bonds, Series 2012,
dated December 1,2012, in the original principal amount of$1,465,000 and
stated to mature on February 1, 2025, February 1, 2028, and February 1;
2030, in the aggregate principal amount of$875,000. These obligations
` have been called for redemption on February 1, 2022.
2. City of Cibolo, Texas General Obligation Bonds, Series 2013, dated July 1,
2013, in the original principal amount-of$8,500,000 and stated to mature
on;,February 1 in each of-the years 2023 through 2033, in the aggregate
principal amount of $5,265,000. These obligations have.been called for
redemption on February 1, 2022.
3. City of Cibolo, Texas General Obligation Refunding Bonds, Series 2017,
dated November 1,2017,in the original principal amount of$8,325,000 and
stated to mature on February 1 in each of the years 2023 through 2029, in
the aggregate principal amount of$5,800,000. These obligations have been
called for redemption on November 24, 2021.
SCHEDULE II
Approval Certificate
See Tab No.
EXHIBIT A
Paying Agent/Registrar Agreement
See Tab No.
A-1
EXHIBIT B
Official Bid Form
See Tab No.
EXHIBIT C
Escrow Deposit Letter
See Tab No.
EXHIBIT D
Notice of Redemption
See Tab No.
EXHIBIT E
DTC Letter of Representations
See Tab No.
EXHIBIT F
Description of Annual Financial Information
The following information is referred to in Section 37 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 City's audited financial statements for the most recently concluded fiscal year
or to the extent these audited financial statements are not available, the portions of the unaudited
financial statements of the City appended to the Official Statement as Appendix D, but for the
most recently concluded fiscal year.
2. Subject to the exemption pursuant to subsection (d)(2) of the Rule set forth in the
Official Statement (requiring that the following information be provided only if prepared in the
ordinary course of business, which it is not currently), the quantitative financial information and
operating data of the City of the general type included in Appendix A of the Official Statement.
Accounting Principles
The accounting principles referred to in such Section are generally accepted accounting
principles for governmental units as prescribed by the Government Accounting Standards Board
from time to time.
EXHIBIT G
General Policies and Procedures Concerning Compliance with the Rule
I. Capitalized terms used in this Exhibit have the meanings ascribed thereto in Section 37 of
the Ordinance. "Bonds" refers to the Bonds that are the subject of the Ordinance to which this
Exhibit is attached.
II. As a capital markets participant,the City is aware of its continuing disclosure requirements
and obligations existing under the Rule prior to February 27, 2019, the effective date of the most
recent amendment to the Rule (the Effective Date), and has implemented and maintained internal
policies, processes, and procedures to ensure compliance therewith. Adherence to these internal
policies, processes, and procedures has enabled underwriters in non-exempt negotiated sales and
initial purchasers in non-exempt competitive sales to comply with their obligations arising under
various MSRB rules and regulations concerning due diligence and findings of suitability, among
other matters, regarding the City's compliance with the Rule.
III. The City is aware that the Rule was amended as of the Effective Date(the Rule Amendment)
and has accommodated this amendment by adding subparagraphs (15) and (16)to Section 37C of
the Ordinance, which provisions are a part of the Undertaking.
IV. The City is aware that"participating underwriters" (as such term is defined in the Rule) of
the Bonds must make inquiry and reasonably believe that the City is likely to comply with the
Undertaking and that the standards for determining compliance have increased over time as a result
of, among others, the United States Securities and Exchange Commission's Municipalities
Continuing Disclosure Cooperation Initiative and regulatory commentary relating to the
effectiveness of the Rule Amendment.
V. The City now establishes the following general policies and procedures (the Policies and
Procedures) for satisfying its obligations pursuant to the Undertaking, which policies and
procedures have been developed based on the City's informal policies, procedures, and processes
utilized prior to the Effective Date for compliance with the City's obligations under the Rule, the
advice from and discussions with the City's internal senior staff (including staff charged with
administering the City's financial affairs), its municipal or financial advisors, its legal counsel
(including Bond Counsel), and its independent accountants, to the extent determined to be
necessary or advisable (collectively,the Compliance Team):
1. the Director of Finance (the Compliance Officer) shall be responsible for satisfying the
City's obligations pursuant to the Undertaking through adherence to these Policies and
Procedures;
2. the Compliance Officer shall establish reminder or "tickler" systems to identify and
timely report to the MSRB, in the format thereby prescribed from time to time, the
City's information of the type described in Section 37B of the Ordinance;
3. the Compliance Officer shall promptly determine the occurrence of any of the events
described in Section 37C of the Ordinance;
4. the Compliance Officer shall work with external consultants of the City, as and to the
extent necessary, to timely prepare and file with the MSRB the annual information of
the City and notice of the occurrence of any of the events referenced in Clauses 2 and
3 above, respectively, the foregoing being required to satisfy the terms of the
Undertaking;
5. the Compliance Officer shall establish a system for identifying and monitoring any
Financial Obligations, whether now existing or hereafter entered into by the City, and
(upon identification) determining if such Financial Obligation has the potential to
materially impact the security or source of repayment of the Bonds;
6. upon identification of any Financial Obligation meeting the materiality standard
identified in Clause 5 above, the Compliance Officer.shall establish a process for
identifying and monitoring any City agreement to covenants, events of default,
remedies,priority rights, or other similar terms under such Financial Obligation;
7. the Compliance Officer shall establish a process for identifying the occurrence of any
default,event of acceleration,termination event,modification of terms,or other similar
events under the terms of any Financial Obligation, the occurrence of any of which
reflect financial difficulties of the City; and
8. the Compliance Officer shall annually review these Policies and Procedures with the
remainder of the Compliance Team, make any modifications on an internal document-
retained by the Compliance Officer and available to any"participating underwriter"(as
defined in the Rule), if requested, and on the basis of this annual review (to the extent
determined to be necessary or desirable), seek additional training for herself or himself,
as well as other members of the City's internal staff identified by the Compliance
Officer to assist with the City's satisfaction of the terms and provisions of the
Undertaking.
EXHIBIT H
Written Procedures Relating to
Continuing Compliance with Federal Tax Covenants
A. Arbitrage. With respect to the investment and expenditure of the proceeds of the
Bonds,the City's Chief Financial Officer(the Responsible Person),which currently is the Director
of Finance, will:
(i). .. monitor all amounts deposited into a sinking fund or funds (e.g., the Interest and
Sinking Fund), to assure that the maximum amount invested at a higher yield than
the yield on the Bonds does not exceed an amount equal to the debt service on the
Bonds in the succeeding 12 month period plus a carryover amount equal to one-
twelfth of the principal and interest payable on the Bonds for the immediately
preceding 12-month period;
(ii) monitor the actions of the Escrow Agent to ensure compliance with the applicable
provisions of the Escrow Agreement,including with respect to reinvestment of cash
balances;
(iii) ensure that the applicable information return(e.g., IRS Form 8038-G, 8038-GC, or
any successor forms) is timely filed with the IRS; and
(iv) assure that unless excepted from rebate and yield restriction under Section 148(f)
of the Code, excess investment earnings are computed and paid to the U.S.
government at such time and in such manner as directed by the IRS (A at least every
5 years after the date of deliver of the Bonds (the Issue Date), and (B) within 30
days after the date the Bonds are.retired.
B. Private Business Use. Withrespect to the use of the facilities financed or refinanced
with the proceeds of the Bonds,the Responsible Person will:
(i) monitor the date on which the facilities are substantially complete and available to
be used for the purpose intended
(ii) monitor whether, at any time the Bonds are outstanding, any person, other than the
Issuer, the employees of the Issuer, the agents of the Issuer or members of the
general public has any contractual right(such as a lease,purchase,management, or
other service agreement) with respect to any portion of the facilities;
(iii) monitor whether, at any time the Bonds are outstanding, any person, other than the
Issuer, the employees of the Issuer, the agents of the Issuer or members of the
general public has a right to use the output of the facilities (e.g., water, gas,
electricity);
(iv) monitor whether, at any time the Bonds are outstanding, any person other than the
Issuer, the employees of the Issuer, the agents of the Issuer or members of the
general public has a right to use the facilities to conduct or to direct the conduct of
research;
(v) determine whether, at any time the Bonds are outstanding, any person, other than
the Issuer,has a naming right for the facilities or any other contractual right granting
an intangible benefit;
(vi) determine whether, at any time the Bonds are outstanding,the facilities are sold are
otherwise disposed of, and
(vii) take such action as is-necessary to remediate any failure to maintain compliance
with the covenants contained in the Ordinance related to the public use of the
facilities.
C. Record Retention. The Responsible Person will maintain or cause to be maintained
all records relating to the investment and expenditure of the proceeds of the Bonds and the use of
the facilities financed or refinanced thereby for a.period ending three (3) years after the complete
extinguishment of the Bonds. If any portion of the Bonds is refunded with the proceeds of another
series of tax-exempt obligations, such records will be maintained until the three (3)years after the
refunding obligations are completely extinguished. Such records can be maintained in paper or
electronic format.
D. Responsible Person. . The Responsible Person shall receive appropriate training
regarding the Issuer's accounting system, contract intake system, facilities management and other
systems necessary to track the investment and expenditure of the proceeds and the use of the
facilities financed or refinanced with.the proceeds of the Bonds. The foregoing notwithstanding,
the Responsible Person is authorized and instructed to retain such experienced advisors and agents
as may be necessary to carry out the purposes of these instructions.