HomeMy WebLinkAbout12874 ORD - 10/29/1975TO THE MEMBERS OF THE CITY COUNCIL
Corpus Christi, Texas
For the reasons set forth in the emergency clause
of the foregoing ordinance, a public emergency and imper-
ative necessity exist for the suspension of the Charter
rule or requirement that no ordinance or resolution shall
be passed finally on the date it is introduced, and that
such ordinance or resolution shall be read at three meetings
of the City Council; I, therefore, request that you suspend
said Charter rule or requirement and pass this ordinance
finally on the date it is introduced, or at the present
meeting of the City Council.
Respectfully,
MAYOR (::;
THE CITY OF CORPUS CHRISTI,
TEXAS
•
THE STATE OF TEXAS
COUNTY OF NUECES
CITY OF CORPUS CHRISTI
On this the 29th day of October, 1975, the City
Council of the City of Corpus Christi, Texas, convened in
Regular Meeting, with the following members of said Council
present, to -wit:
Jason Luby, Mayor,
Mayor Pro Tem,
Edward De Ases,
Commissioners,
Ruth Gill,
Bob Gulley,
Gabe Lozano, Sr.,
Bil ad. City Secretary
with the following absent: A
C� constituting a quorum,
at which time the following among other business was transacted:
presented for the consideration of
the Council an ordinance. The ordinance was read by the City
Secretary. The Mayor presented to the Council a communication
in writing pertaining to said proposed ordinance, as follows:
"Corpus Christi, Texas
October 22, 1975
"TO THE MEMBERS OF THE CITY COUNCIL
Corpus Christi, Texas
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"For the reasons set forth in the emergency clause of
the foregoing ordinance, a public emergency and imperative
necessity exist for the suspension of the Charter rule or re-
quirement that no ordinance or resolution shall be passed
finally on the date it is introduced, and that such ordinance
or resolution shall be read at three meetings of the City
Council; I, therefore, request that you suspend said Charter
rule or requirement and pass this ordinance finally on the
date it is introduced, or at the present meeting of the City
Council.
Respectfully,
/s/ Jason Luby
MAYOR
THE CITY OF CORPUS CHRISTI,
TEXAS"
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Commissioner moved that the Charter
provision prohibiting ordina ces from being passed finally on
the date introduced be suspended for the reasons stated in the
written request of the Mayor and stated in the emergency clause
of the ordinance. The motion was seconded by Commissioner
The motion was carried by a unanimou
vote by the City Council, viz:
AYES: All present voting A
NAYS: Non '
The Mayor requested that the records show that he
voted Aye. This was done.
Commissioner moved that the
ordinance be passed finally. The motion was seconded by Com-
missioner The motion was carried by the
following vote: \ _
AYES: All presen am& voting,Xyd' A.
NAYS: Nonev
The Mayor requested that the records show that he
voted Aye. This was done.
The Mayor announced that the ordinance had been
passed. The ordinance is as follows:
ORDINANCE NO. 12874
AUTHORIZING THE EXECUTION OF AN ESCROW
AGREEMENT WITH MERCANTILE NATIONAL BANK
AT DALLAS AND DECLARING AN EMERGENCY.
WHEREAS, the following bond issues of said City are
presently outstanding:
City of Corpus Christi First Mortgage
Waterworks Revenue Bonds, Series 1954, dated
February 1, 1954, aggregating $2,505,000
in principal amount, maturing in the years
1976 through 1983;
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City of Corpus Christi First Mortgage
Waterworks Revenue Bonds, Series 2 of 1954,
dated October 1, 1954, aggregating
$1e5�,000 in 976incipalha 983t, maturing in
City of Corpus Christi First Mortgage Water-
works Revenue Bonds, Serie6eprinci-
June 1, 1960, aggregating $610000 ears t in in
pal amount, maturing in the y
through 1984;
City of Corpus Christi First Mortgage
Waterworks Revenue Bonds, Series 1962, dated
February 1, 1962, aggregating $65r000 in
1976;
principal amount, maturing in the year
City of Corpus Christi, Texas First Mortgage d
Waterworks Revenue Bonds, Series 120,000 in
February 1, 1969, aggregating $ in the y ears 1976
principal amount, maturing
through 1986; and
City of Corpus Christi, Texas, First Mortgage
Waterworks Revenue Bonds, Series 1969 -Al 00
dated October 1, 1969, augreg ti the years
in principal amount, ma
1976 through 1980; and
WHEREAS, the City is authorized to refund all of
said bonds (the "Underlying Bonds ") in accordance with Vernon's
Art. 717k, in order to eliminate the mortgage on the City's
Waterworks System and to permit the issuance of the bonds herei
authorized and bonds on a parity therewith; and
WHEREAS, concurrently herewith the City has duly
authorized to be issued and sold in accordance with Article
717k its refunding bond to be designated City of Corpus
Christi, Texas, Junior Lien Waterworks Revenue Bond, Series
1975 (the "Bond ") in the principal amount of $7,895,000, for
the purpose of providing moneys to redeem the Underlying Bonds
in the aggregate principal amount of $7,105,000, the required
redemption premium therefor and interest thereon to maturity
or redemption date.
WHEREAS, the proceeds of the sale of the Bond, to-
gether with other moneys of the City lawfully available
therefor, shall be applied as follows:
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(a) to pay the principal of the Under-
lying Bonds maturing as follows:
June 1, 1976 $ 681,000
June 1, 1977 $ 694,000
June 1, 1978 $ 714,000
June 1, 1979 $ 734,000
June 1, 1980 $ 765,000
(b) to pay the principal of the Underlying
Bonds prior to stated maturities thereof, on June
6, 1980, $3,517,000;
(c) to pay interest on the Underlying Bonds
to date of redemption or maturity as provided in
(a) and (b), $1,125,803.75;
(d) to pay premium on the Underlying Bonds
called for redemption prior to stated maturities,
$87,925.00;
(e) to pay Paying Agent's fee for paying the
premium of and interest on the Underlying Bonds,
$2,926.23 and
(f) to pay State Treasurer's Fee, $1,000.00
WHEREAS, in accordance with Article 717k, such proceed,
and such other funds will be deposited by the City with the Stat,
Treasurer, and it is the duty of the State Treasurer, immediatel:
after receipts of such funds, to forward such funds by the most
expeditious manner to the place of payment for the Underlying
Bonds located in the State of Texas, to wit, the Mercantile
National Bank at Dallas, Dallas, Texas, (the "Paying Agent ");
and
WHEREAS, in accordance with Article 717k it is the
duty of said bank to deposit the aforementioned funds received
from the State Treasurer (excepting the amount thereof repre-
senting the changes of the place of payment) into an interest
and sinking fund to be established and maintained in trust and
as a trust fund for payment of the Underlying Bonds; and
WHEREAS, it is in order that the City and the Paying
Agent enter into an escrow agreement governing the handling of
the funds held in said interest and sinking fund.
NOW THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF
THE CITY OF CORPUS CHRISTI: .
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Section 1. That the City of Corpus Christi is hereby
authorized to enter into an agreement with Mercantile National
Bank at Dallas, the Mayor of the City of Corpus Christi is here-
by authorized to execute such Agreement on behalf of the City,
and the City Secretary is authorized to impress the seal of
said city thereon and attest same, such agreement to be in the
form substantially as follows:
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ESCROW AGREEMENT
THE STATE OF TEXAS
COUNTY OF NUECES
CITY OF CORPUS CHRISTI
THIS AGREEMENT dated the 29th day of October, 1975,
made by and between the City of Corpus Christi, Texas (herein-
after referred to as the "City "), a duly constituted municipal
corporation and body politic and corporate under the laws of
the State of Texas, party of the first part, and Mercantile
National Bank at Dallas, Dallas, Texas, a national banking
association organized and existing under the laws of the United
States of America, having its principal office in the City of
Dallas, Texas (hereinafter referred to as the "Paying Agent"),
party of the second part.
W I T N E S S E T H:
WHEREAS, the following bond issues of said City are
presently outstanding:
City of Corpus Christi First Mortgage
Waterworks Revenue Bonds, Series 1954, dated
February 1, 1954, aggregating $2,505,000 in
principal amount, maturing in the years 1976
through 1983;
City of Corpus Christi First Mortgage
Waterworks Revenue Bonds, Series 2 of 1954, dated
October 1, 1954, aggregating $155,000 in
principal amount, maturing in the years 1976
through 1983;
City of Corpus Christi First Mortgage
Waterworks Revenue Bonds, Series 1960, dated
June 1, 1960, aggregating $610,000 in principal
amount, maturing in the years 1976 through 1984;
City of Corpus Christi First Mortgage
Waterworks Revenue Bonds, Series 1962, dated
February 1, 1962, aggregating $65,000 in prin-
cipal amount, maturing in the year 1976;
City of Corpus Christi, Texas, First Mortgage
Waterworks Revenue Bonds, Series 1969, dated
February 1, 1969, aggregating $3,120,000 in
principal amount, maturing in the years 1976
through 1986; and
•
City of Corpus Christi, Texas, First Mortgage
Waterworks Revenue Bonds, Series 1969 -A,
dated October 1, 1969, aggregating $650,000
in principal amount, maturing in the years
1976 through 1980; and
WHEREAS, the City is authorized to refund all of said
bonds (the "Underlying Bonds ") in accordance with Art. 717k
V.A.C.S. ( "Article 717k ") in order to eliminate the mortgage on
the City's Waterworks System and to permit the issuance of the
bond herein described and bonds on a parity therewith; and
WHEREAS, concurrently herewith the City has duly
authorized to be issued and sold in accordance with Article
717k its refunding bond to be designated City of Corpus Christi,
Texas, Junior Lien Waterworks Revenue Bond, Series 1975 ( "the
Bond ") in the principal amount of $7,895,000 for the purpose of
providing moneys to redeem the Underlying Bonds in the aggregate
principal amount of $7,105,000, the required redemption premium
therefor and interest thereon to maturity or redemption date;
and
WHEREAS, the proceeds of the sale of the Bond,
together with other moneys of the City lawfully available there-
for, shall be applied as follows:
(a) to pay the principal of the Under-
lying Bonds maturing as follows:
June 1, 1976 $ 681,000
June 1, 1977 $ 694,000
June 1, 1978 $ 714,000
June 1, 1979 $ 734,000
June 1, 1980 $ 765,000;
(b) to pay the principal of the Under-
lying Bonds prior to stated maturities thereof,
on June 6, 1980, $3,517,000;
(c) to pay interest on the Underlying
Bonds to date of redemption or maturity as
provided in (a) and (b), $1,125,803.75;
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(d) to pay premium on the Underlying
Bonds called for redemption prior to stated
maturities, $87,925.00;
(e) to pay Paying Agent's fee for paying the
principal of and interest on the Underlying Bonds,
$2,926.23; and
(f) to pay State Treasurer's fee, $1,000.00; and
WHEREAS, in accordance with Article 717k, such pro-
ceeds and other funds will be deposited by the City with
the State Treasurer, and it is the duty of the State Treasurer,
immediately after receipt of such funds, to forward such funds
by the most expeditious means to the place of payment for the
Underlying Bonds located in the State of Texas, to -wit:
Mercantile National Bank at Dallas, Dallas, Texas (the "Paying
Agent"); and
WHEREAS, in accordance with Article 717k it is the duty
of the Paying Agent to deposit the aforementioned funds received
from the State Treasurer (excepting the amount thereof repre-
senting the charges of the place of payment) into an interest
and sinking fund to be established and maintained in trust and
as a trust fund for payment of the Underlying Bonds; and
WHEREAS, it is in order that the City and the Paying
Agent enter into an escrow agreement governing the handling of
the funds held in said interest and sinking fund.
NOW, THEREFORE, in consideration of the mutual agree-
ments herein contained and in consideration of Ten Dollars
($10.00) duly paid by the City to the Paying Agent concurrently
herewith, the receipt whereof is hereby acknowledged, and in
order to secure the payment of the principal of and interest on
the Underlying Bonds, as the same mature and become due, the
Parties hereto mutually undertake, promise and agree for them-
selves, their respective representatives, successors and assigns,
as follows:
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SECTION 1. (a) There shall be deposited by the
City with the Bank to be held in a special trust fund and
separate trust account, designated as the "City of Corpus Christi
Texas First Mortgage Waterworks Revenue Bonds Interest and Sink-
ing Fund" (hereinafter sometimes referred to as the "Escrow
Account ") from moneys to be furnished by the City to the State
Treasurer and in turn remitted by the State Treasurer, the amount
of $8,318,728.75 from the proceeds of the sale of its City of
Corpus Christi, Texas, Junior Lien Waterworks Revenue Bond,
Series 1975, and other lawfully available funds of the City.
(b) The Paying Agent will invest said moneys imme-
diately upon receipt thereof in the Federal Securities listed in
Exhibit A attached hereto and made a part hereof.
SECTION 2. The Paying Agent shall hold the Escrow
Account and the securities as a special and separate trust
fund, wholly segregated from other funds and securities on
deposit with it; shall never commingle such deposit or securities
with other funds or securities of the Paying Agent, and shall neve
at any time use, loan or borrow the same in any way. Nothing
herein contained shall be construed as requiring the Paying Agent
to keep the identical moneys, or any part thereof, received for
the City's account on hand, but moneys of an equal amount, ex-
cept to the extent such are represented by Federal Securities,
and such Federal Securities shall always be maintained on hand
as trust funds belonging to the City and held by the Paying
Agent as trustee; and a special account thereof evidencing such
fact shall at all times be maintained on the books of the Paying
Agent, together with such securities so purchased.
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SECTION 3. The Paying Agent shall from time to time
present for payment the Federal Securities in the Escrow Account
as they respectively mature so that the proceeds from the
maturing Federal Securities held for the account of the City
will be sufficient to pay the principal, the premium thereon and
interest thereon as the Underlying Bonds mature or are payable
on redemption prior to maturity, and as the interest thereon
becomes due.
SECTION 4. The Paying Agent shall collect the interes
on the Federal Securities as the same becomes due and remit same
to the City.
SECTION 5. The Escrow Account will be invested only
in the securities listed in Exhibit A and neither the City nor
the Paying Agent shall reinvest any moneys in the Escrow Account
other than that initially invested as evidenced by the securitie
listed in Exhibit A. The Paying Agent shall maintain the Escrow
Account until the date upon which said Underlying Bonds are full
paid as to principal, premium and interest whereupon the Paying
Agent shall sell or redeem any Federal Securities remaining in
the Escrow Account and shall remit to the City the proceeds
thereof, together with all other moneys, if any, then remaining
in the Escrow Account.
SECTION 6. The Paying Agent shall continuously secure
the moneys in the Escrow Account not so invested, if any, by
direct obligations of the United States of America in an amount
at all times at least equal to said moneys.
SECTION 7. The Paying Agent shall not be liable or
responsible for any loss resulting from any investment made pur-
suant to this Escrow Account agreement and made in compliance wi
the provisions hereof. The Paying.Agent's usual and reasonable
charges for its escrow services, $250.00 for each semiannual
Li
period,shall not be deducted from the Escrow Account but shall
be paid directly to the Paying Agent by the City.
SECTION 8. In the event of the Paying Agent's failure
to account for any funds or securities received by it for the
City's account, the said funds and securities shall be and
remain the property of the City and the City shall be entitled
to the preferred claim upon such funds and securities enjoyed
by a trust beneficiary. The funds received by the Paying Agent
shall not be considered as a banking deposit by the City and the
Paying Agent shall have no right or title with respect thereto.
The funds so received by the Paying Agent as Escrow Agent and
Trustee shall not be subject to checks drawn by the City.
SECTION 9. The Paying Agent will pay the principal
and interest on the Underlying Bonds in the following manner:
(a) to pay the principal of the Under-
lying Bonds maturing as follows:
June 1, 1976 $ 681,000
June 1, 1977 $ 694,000
June 1, 1978 $ 714,000
June 1, 1979 $ 734,000
June 1, 1980 $ 765,000;
(b) to pay the principal of the Under-
lying Bonds prior to stated maturities thereof,
on June 6, 1980, $3,517,000;
(c) to pay interest on the Underlying
Bonds to date of redemption or maturity as
provided in (a) and (b), $1,125,803.75;
(d) to pay premium on the Underlying
Bonds called for redemption prior to stated
maturities, $87,925.00.
SECTION 10. If, for any reason, at any time, the
funds on hand in the Escrow Account shall be insufficient to
make such payments, which shall be about to become due and pay-
able, the City shall forthwith deposit in the Escrow Account
from lawfully available funds such additional funds as may be
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required to meet fully the amount so about to become due and
payable. Notice of such insufficiency shall be given as herein-
after provided, but the Paying Agent shall in no manner be
responsible for the City's failure to make such deposit.
SECTION 11. The Paying Agent shall, from time to time,
as necessary forward to Chemical Bank, New York, New York as a
place of payment for the Underlying Bonds, for deposit in separat
funds and trust accounts for the payment thereof the amount of
interest and principal becoming due on each interest and princi-
pal payment date for the Underlying Bonds as shall be presented to
the said Chemical Bank for payments. The amount so forwarded to
the Chemical Bank shall be forwarded in sufficient time to permit
such payments on each interest and principal payment date without
default.
SECTION 12. The Paying Agent shall immediately notify
the City by registered, first -class mail, postage prepaid, if
and whenever for any reason the funds on hand in the Escrow Ac-
count, plus the Federal Securities therein will be insufficient to
Pay the principal, the premium thereon and interest thereon, as tl
Underlying Bonds mature, or are payable on redemption prior to
maturity, and as the interest thereon becomes due.
SECTION 13. As of the first day of September of each
calendar year, commencing in the year 1976, and so long as the
Escrow Account is maintained, and at times when any moneys
therein are invested or any Federal Securities therein are sold
or redeemed, the Paying Agent shall forward by letter to the
City a statement in detail of the income, investments, maturities
and withdrawals of moneys from the Escrow Account for the
immediately preceding year, or for that portion of the current
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year, or in the case of a statement for such investments, re-
garding the manner in which it has carried out the requirements
of this Agreement.
SECTION 14. The Paying Agent shall not be liable for
any act done or step taken or omitted by it or any mistake of
fact or law or for anything which it may do or refrain from doing
except for its negligence or its default in the performance of
any obligation imposed upon it hereunder. The Paying Agent shalt
not be responsible in any manner whatsoever for the recitals or
statements contained in the Underlying Bonds or the Bond or any
proceedings taken in connection therewith.
SECTION 15. Time shall be of the essence in the
performance of obligations from time to time imposed upon the
Paying Agent by this Agreement.
IN WITNESS WHEREOF, the City of Corpus Christi, Texas,
has caused these presents to be signed in its corporate name by
the Mayor, sealed with its corporate seal, and attested by the
City Secretary, and Mercantile National Bank at Dallas, Dallas,
Texas, has caused these presents to be signed in its corporate
name by one of its Assistant Vice Presidents and Trust Officers,
sealed with its corporate seal, attested by its Cashier or one
of its Assistant Cashiers, all as of the date and year above
written.
CITY OF,,100ROUS CHRISTI, TEXAS
BY
ATTEST:
A4 _
Mayor
The foregoing Ordinance was approved prior to
passage as to form and correctness this 29th day of October,
1975.
City Attorne
(SEAL)
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MERCANTILE NATIONAL BANK AT
BY
Assistant Vice Pres
ATTEST: Trust Officer
(SEAL)
Cashier
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EXHIBIT A
CITY OF* CORPUS C1IRISTI FIRST MORTGAGE •
WATERWORKS REVENUE REFUNDING 13ONDS
ADVANCE REFUNDING
Aland Requirements
Interest
Principal
Total
$158,176.25
$ 681,000
$ 839,176.25
144,297.50
144,297.50
144,297.50
694,000
.838,297.50
130,026.25
130,026.25
130,026.25
714,000
844,026.25
114,435.00
114,435.00
114,435.00
734,000
848,435.00
95,055.00
95,055.00
95,055.00
•765,000
860,055.00
Premium
87,925.00
3,517,000
3,604,925.00
$7,105,000
$8,318,728.75
.Mercantile
National Bank Fee
..... 2,926.23
$8,321,654.98
State Treasurer's Fee ............. 1,000.00
TOTAL REQUIREMENTS ..............$8,322,654.98
FUNDS
Bond Proceeds ...................
Premium .......................
Total Bond Proceeds .........
Deposit by City .................
Total Funds .................
Less: Fees .....................
Funds Available for Investment ..
$7,895,000.00
••12,396.99
$7,907,396.99
415,257.99
$8,322,654.98
3,926.23
$8,318,728.75
EXHIBIT A - page 2 •
CITY OF CORPUS CHRISTI FIRST MORTGAGE
WATERWORKS REVENUE REFUNDING BONDS
ADVANCE REFUNDING
Investment of Funds
November 5, 1975 Purchases
U. S. Treasury Bills due 11 -28 -75
@ approx. 5.20% disc. $6,781,939.15
* U. S. Treasury 6 7/8% Notes due 5 -15 -80
@ approx. 7.60% yield 1,536,789.60
$8,318,728.75
December 1, 1975
Purchases
U. S. Treasury
Certificates of
Indebtedness and
Treasury Notes - State & Local Government Series
Certificates of
Indebtedness
Amount
Interest Rate
Maturity
$ 840,000
4.10378%
6 -1 -76
$ 145,000
4.10378%
12 -1 -76
Treasury Notes
$ 840,000
4.10378%
6 -1 -77
1301000
"
12 -1 -77
845,000
"
6 -1 -7B
115,000
"
12 -1 -78
850,000
"
6 -1 -79
95,000
"
12 -1 -79
2,920,000
6 -1 -80
** $6,780,000
* Represents the lessor of the following under Sec. 1.103 -13 (b)
Arbitrage Bonds (38 Fed Reg - 10944)
A. 15% of face amount of Jr. Lien, 1975 Issue $7,895,000
_ $1,184,250
B. 5% of face amount of Jr. Lien, 1975 Issue
$7,895,000 = $ 394,750.00
1 year average debt serv.
Principal $526,333.33
Interest 21,711.25
5 8,094.5 x 1 1/3 = 730,707.84
$1,125,457.84
Plus deposit by City less fees 411,331.76
1,536,789.60
** Represents $1,939.15 under authorized investments because of 5M
denominational limitation in State and Local Government issue.
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Section 2. The fact that refunding of the Underlying
Bonds is necessary in order to issue bonds for extensions and
improvements to the System and such extensions and improvements
are necessary for the orderly development and growth of the
City of Corpus Christi, Texas, and the escrow agreement which
is the subject of this ordinance is necessary to facilitate
such refunding creates a public emergency and an imperative
public necessity requiring the suspension of the Charter Rule
providing that no ordinance or resolution shall-be passed
finally on the date it is introduced and that such ordinance
or resolution shall be read at three several meetings of the
City Council and the Mayor having declared that such public
emergency and imperative necessity exist, and having requested
that said Charter Rule be suspended and that this ordinance
take effect and be in full force and effect from and after its
passage, it is accordingly so ordained.
Section 3. That all ordinances and resolutions or
parts thereof in conflict herewith are hereby repealed.
PASSED AND APPROVED this the 29th day of October, 1975
of CorpTs`Chrigt/,
ATTEST:
City Secretary, City o
Corpus Christi, Texas
The foregoing Ordinance was approved prior to passage
as to form and correctness this 29th day of July, 1975.
4V44A0JAA
i i ty Attor ey, ity of Corpus Christi
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THE STATE OF TEXAS
COUNTY OF NUECES
CITY OF CORPUS CHRISTI
I, the undersigned, City Secretary of the City of
Corpus Christi, Texas, do hereby certify that the above and
foregoing is a true, full and correct copy of an Ordinance
passed by the City Council of the City of Corpus Christi,
Texas, (and of the minutes pertaining thereto) on the 29th
day of October, 1975, authorizing an escrow agreement with
Mercantile National Sank at Dallas, which ordinance is duly
of record in the minutes of said City Council, and said meet-
ing was open to the public as required by law and public
notice of the time, place, and purpose of said meeting was
given as required by V.A.C.S., Art. 6252 -17, as amended.
EXECUTED UNDER MY HAND AND SEAL OF SAID CITY, this
the a9 W day of VL' jyac-g_ , 1975.
( SEAL)
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City Secretary, City + Corpus
Christi, Texas \