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HomeMy WebLinkAbout027708 ORD - 05/20/2008ORDINANCE AUTHORIZING ISSUANCE OF TAX NOTES IN THE PRINCIPAL AMOUNT T F $22,260,000; APPROVING THE SALE OF THE NOTES; PROVIDING FOR THE LEVY, ASSESSMENT AND COLLECTION OF A TAX SUFFICIENT TO PAY THE INTEREST ON SAID NOTES AND TO CREATE A SINKING FUND FOR THE PAYMENT OF THE PRINCIPAL THEREOF; AND ORDAINING OTHER MATTERS RELATED THERETO THE STATE OF TEXAS COUNTIES OF NUECES AND SAN PATRICIO CITY F CORPUS CHRISTI WHEREAS, the Issuer (such term and other capitalized terms used in this Ordinance being as defined in Exhibit A attached hereto), is a home -rule municipality having a total population of at least 50,000 according to the last preceding federal census, and was organized, created and established pursuant to the Constitution and laws of the State of Texas; and WHEREAS, the City Council is authorized pursuant to Chapter 1431 to issue anticipation notes for specified purposes, including, without limitation, to pay a contractual obligation incurred or to be incurred for the construction of a public work and the purchase of materials, supplies, equipment, machinery, buildings, lands, and rights-of-way for an issuer's authorized needs and purposes; and WHEREAS, the City Council deems it in the best interest of the Issuer to issue the Notes, pursuant to Chapter 1431, for the purposes hereinafter stated, and to secure the payment of the Notes from a pledge of the ad valorem taxes assessed and collected by the City. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: Section 1. RECITALS, AMOUNT AND PURPOSE OF NOTES. That pursuant to authority granted to the City Council by Chapter 1431, the Notes shall be and are hereby authorized to be issued in the aggregate principal amount of $22,260,000 for the purpose of THE CONSTRUCTION F PUBLIC WORKS AND THE PURCHASE OF MATERIALS, SUPPLIES, EQUIPMENT, MACHINERY, BUILDINGS, LANDS, AND RIGHTS-OF-WAY, as more fully described in Schedule 1 attached to this Ordinance (the "Projects"), and to pay the costs of issuance of the Notes. Section 2. DESIGNATION, DATE, DENOMINATIONS, NUMBERS, AND MATURI- TIES OF NOTES. That the Notes shall be designated as the "City of Corpus Christi, Texas, Tax Notes, Series 2008". The Notes shall be dated May 1, 2008, shall be in Authorized Denominations, shall be numbered consecutively from R-1 upward, and shall mature on March 1 in each of the years, and in the amounts, respectively, as set forth in the following schedule: 027708 MATURITY DATE: MARCH 1 YEARS AMOUNTS ($) 2009 16,000,000 2010 965,000 2011 995,000 2012 1,025,000 2013 1,060,000 2014 1,090,000 2015 1,125,000 Section 3. NOTE PURCHASE AGREEMENT. That the Purchase Agreement in substantially the form attached to this Ordinance is hereby accepted, approved and authorized to be delivered in executed form to the Purchaser. An Authorized Representative, acting for and on behalf of the City Council, shall cause the Purchase Agreement to be executed and delivered to the Purchaser. The City Secretary is hereby authorized to attest the execution of the Purchase Agreement on behalf of the City. Section 4. INTEREST. That the Notes shall bear interest from the date specified in the FORM OF NOTE set forth in this Ordinance to their respective dates of maturity or redemption prior to maturity at the rate of 3.52% per annum. Said interest shall be payable in the manner provided and on the dates stated in the FORM OF NOTE set forth in this Ordinance. Section 5. CHARACTERISTICS OF THE NOTES. (a) Registration, Transfer, Conversion and Exchange; Authentication. That the Issuer shall keep or cause to be kept at the designated corporate trust office of the Paying Agent/Registrar the Registration Books, and the Issuer hereby appoints the Paying Agent/Registrar as its registrar and transfer agent to keep such books or records and make such registrations of transfers and exchanges under such reasonable regulations as the Issuer and the Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such registrations, transfers and exchanges as herein provided within three days of presentation in due and proper form. The Paying Agent/Registrar shall obtain and record in the Registration Books the address of the registered owner of each Note. The Issuer shall have the right to inspect the Registration Books during regular business hours of the Paying Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books confidential and, unless otherwise required by law, shall not permit their inspection by any other entity. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for making such registration, transfer, exchange and delivery of a substitute Note or Notes. Registration of assignments, transfers and exchanges of Notes shall be made in the manner provided and with the effect stated in the FORM OF NOTE. Each substitute Note shall bear a letter andlor number to distinguish it from each other Note. -2- An authorized representative of the Paying Agent/Registrar shall, before the delivery of any such Note (other than Notes that bear the signature of the Comptroller of Public Accounts of the State of Texas, as provided in the FORM OF NOTE), date and manually sign said Note, and no such Note shall be deemed to be issued or outstanding unless such Note is so executed. The Paying Agent/Registrar promptly shall cancel all paid Notes surrendered for transfer and exchange. No additional ordinances, orders, or resolutions need be passed or adopted by the Issuer or any other body or person so as to accomplish the foregoing transfer and exchange of any Note or portion thereof, and the Paying Agent/Registrar shall provide for the printing, execution, and delivery of the substitute Notes in the manner prescribed herein. Pursuant to Chapter 1201, and particularly Subchapter D thereof, the duty of transfer and exchange of Notes as aforesaid is hereby imposed upon the Paying AgentlRegistrar, and, upon the execution of said Notes, the transferred and exchanged Notes shall be valid and enforceable in the same manner and with the same effect as the Notes which initially were issued and delivered pursuant to this Ordinance and approved by the Attorney General of the State of Texas. (b) Payment of Notes and Interest. The Issuer hereby further appoints the Paying AgentlRegistrar to act as the paying agent for the payment of the principal of and interest on the Notes, all as provided in this Ordinance. The Paying Agent/Registrar shall keep proper records of all payments made by the Issuer and the Paying Agent/Registrar with respect to the Notes, and of all transfers and exchanges of Notes, and all replacements of Notes, as provided in this Ordinance. In General. The Notes (1) shall be issued in fully registered form, without interest coupons, with the principal of and interest on such Notes to be payable only to the registered owners thereof,(ii) may be transferred, assigned, converted, and exchanged for other Notes, (iii) may be subject to redemption prior to their scheduled maturities, (iv) shall have the characteristics, (v) shall be signed, sealed, executed and authenticated, (vi) the principal of and interest on the Notes shall be payable, and (vii) shall be administered and the Paying AgentlRegistrar and the Issuer shall have certain duties and responsibil- ities with respect to the Notes, all as provided, and in the manner and to the effect as required or indicated, in the FORM OF NOTE. On each substitute Note issued in conversion of and exchange for any Note or Notes issued under this Ordinance the Paying Agent/Registrar shall execute the PAVING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE, in the form set forth in the FORM OF NOTE. (d) Substitute Paying gentlFegistrar. The issuer covenants with the registered owners of the Notes that at all times while the Notes are outstanding the Issuer will provide a competent and legally qualified bank, trust company, financial institution, orotherageny to act as and perform the services of Paying AgentlRegistrar for the Notes under this Ordinance, and that the Paying Agent/Registrar will be one entity. The Issuer reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less than 30 days written notice to the Paying AgentlRegistrar, to be effective not later than 15 days prior to the next succeeding Payment Date. In the event that the entity at any time acting -3- as Paying Agent/Registrar egistrar or its successor by merger, acquisition, or other method) should resign or otherwise cease to act as such, the Issuer covenants that promptly it will appoint a competent and legally qualified bank, trust company, financial institution, or other agency to act as Paying Agent/Registrar under this Ordinance. Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar promptly shall transfer and deliver the Registration Books (or a copy thereof), along with all other pertinent books and records relating to the Notes, to the new Paying Agent/Registrar designated and appointed by the Issuer. Upon any change in the Paying Agent/Registrar, the Issuer promptly will cause a written notice thereof to be sent by the new Paying Agent/Registrar to each registered owner of the Notes, by United States mail, first-class postage prepaid, which notice also shall give the address of the new Paying Agent/Registrar. By accepting the position and performing as such, each Paying Agent/Registrar shall be deemed to have agreed to the provisions of this Ordinance, and a certified copy of this Ordinance shall be delivered to each Paying Agent/Registrar. Section 6. FORM OF NOTES. That the form of the Notes, including the form of Paying Agent/Registrar's Authentication Certificate and the form of Assignment shall be, respectively, substantially in the form attached hereto as Exhibit B, with such variations, omissions, or insertions as are appropriate, permitted or required by this Ordinance including, without limitation, those variations, omissions, or insertions to be completed by an Authorized Representative reflect the terms of the sale of Notes as permitted by Section 2 hereof. Section 7. INTEREST EST AICD SINKING FUND/TAX LEVY. That the Interest and Sinking Fund is hereby created and established solely for the benefit of the Notes, and the Interest and Sinking Fund shall be established and maintained by the Issuer at an official depository bank of the Issuer for so long as the Notes or interest thereon are outstanding and unpaid. The lnterest and Sinking Fund shall be kept separate and apart from alt other funds and accounts of the Issuer, and shall be used only for paying the interest on and principal of the Notes. Until expended for the purposes set forth in Section 1 hereof, the proceeds derived from the sale of the Notes shall be held as further security for the timely payment of the principal and interest on the Notes All ad valorem taxes levied and collected for and on account of the Notes shall be deposited, as collected, to the credit of the Interest and Sinking Fund. During each yearwhile any of the Notes is outstanding and unpaid, the City Council shall compute and ascertain a rate and amount of ad valorem tax which will be sufficient to raise and produce the money required to pay the interest on the Notes as such interest comes due, and to provide and maintain a sinking fund of at least two percent (2%) thereof, in any event in an amount adequate to pay the principal of such Notes as such principal matures; and said tax shalt be based on the latest approved tax rolls of said Issuer, with full allowance being made for tax delinquencies and the cost of tax collection. Said rate and amount of ad valorem tax is hereby levied by the governing body of the Issuer, and is hereby ordered to be levied, against all taxable property in the Issuer for each year while any Note is outstanding and unpaid; and said tax shalt be assessed and collected each such year and deposited to the credit of the aforesaid -4- Interest and Sinking Fund. Said ad valorem taxes sufficient to provide for the payment of the interest on and principal of the Notes as such interest comes due and such principal matures, are hereby pledged from the ad valorem taxes of the Issuer for such payment, within the limit prescribed by law. If sufficient ad valorem taxes have not been levied and collected for the purpose of making debt service payments on Notes when due, there shall be appropriated from the City's general fund moneys sufficient to enable the City to make such debt service payments on a Payment Date including specifically the payment of debt service on the Notes on the first Payment Date therefor. Section 8. CHAPTER 1208, GOVERNMENT CODE, APPLIES TO THE NOTES. Chapter 1208 applies to the issuance of the Notes and the pledge of the taxes granted by the Issuer under Section 7 of this Ordinance, and such pledge is therefore valid, effective, and perfected. If Texas law is amended at any time while the Notes are outstanding and unpaid such that the pledge of the taxes granted by the Issuer under Section 7 of this Ordinance is to be subject to the filing requirements of Chapter 9, then in order to preserve to the registered owners of the Notes the perfection of the security interest in said pledge, the Issuer agrees to take such measures as it determines are reasonable and necessary under Texas law to complywith the applicable provisions of Chapter 9 and enable a filing to perfect the security interest in said pledge to occur. Section 9. REMEDIES OF REGISTERED OWNERS. That in addition to all rights and remedies of any registered owners of the Notes provided by the laws of the State of Texas, the Issuer covenants and agrees that in the event the Issuer defaults in the payment of the principal of or interest on the Notes when due, or fails to make the payments required by this Ordinance to be set forth in this Ordinance, the registered owners of the Notes shall be entitled to a writ of mandamus issued by a court of proper jurisdiction compelling and requiring the City Council and other officers of the Issuer to observe and perform any covenant, obligation or condition prescribed in this Ordinance. No delay or omission by any registered owner to exercise any right or power accruing to him upon 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 or power may be exercised from time to time and as often as may be deemed expedient. The specific remedies mentioned in this Ordinance shall be available to the registered owners of the Notes and shall be cumulative of all other existing remedies. By accepting the delivery of a Note authorized under this Ordinance, the registered owner thereof agrees that the certifications required to effectuate any covenants or representations contained in this Ordinance do not and shall never constitute or give rise to a personal or pecuniary liability or charge against the officers, employees or members of the City or the City Council. None of the members of the City Council, nor any other official or officer, agent, or employee of the City, shall be charged personally by the registered owners with any liability, or be held personally liable to the registered owners of the Notes under any term or provision of this Ordinance, or because of any default or alleged default under this Ordinance. -5- Section 10. TRANSFERS TO PAYING AGENT. That the Issuer further covenants that on or before each Payment Date, or any redemption date, there shall be transferred to the Paying Agent/Registrar an amount sufficient to pay the principal and interest requirements due on the Notes as they become due and payable. Section 11. USE OF NOTE PROCEEDS. That the proceeds of the issuance of the Notes shall be deposited in a designated account within the Issuer's general fund and used to pay contractual obligations incurred or to be incurred in connection with the purposes described in Section 1 of this Ordinance. The foregoing notwithstanding, proceeds representing accrued interest, if any, on the Notes shall be deposited to the credit of the Interest and Sinking Fund, and proceeds, if any, representing premium paid as part of the purchase price for the Notes may be used for any purpose authorized by Section 1201.0 2 d , Texas Government Code. Section 12. INVESTMENTS. (a) That the City may place proceeds of the Notes (including investment earnings thereon) in time deposits or invest the same as authorized by law, including, without limitation, the Public Funds Investment Act of 1987, as amended (Chapter 2256, Texas Government Code), and the City's investment policy; provided, however, that the Issuer hereby covenants that the proceeds of the sale of the Notes will be used as soon as practicable for the purposes for which the Notes are issued. (b) Amounts received from the investment of the proceeds of the Notes remaining after the payment of all project costs and the retirement of debt service on the Notes, to the extent not required to be deposited to a separate rebate fund as required by section 148 of the Code and Section 15 of this Ordinance, shall be placed into the Interest and Sinking Fund and used for the payment of debt service on the Notes. Section 13. SECURITY FOR FUNDS. That all deposits authorized or required by this Ordinance shall be secured to the fullest extent required by law for the security of public funds. Section 14. DUTIES OF OFFICERS OF THE ISSUER. (a) That the Mayor, any Authorized Representative and the City Manager are hereby instructed and directed to do any and all things necessary in reference to the maintenance of the Issuer and to make money available for the payment of the Notes in the mariner provided by law. (b) The City Secretary is authorized to execute the certificate to which this Ordinance is attached on behalf of the City. The Mayor, any Authorized Representative and the City Secretary are authorized to do any and all things proper and necessary to carry out the intent of this Ordinance. (c) The City Manager is hereby authorized to have control of the Notes and all necessary records and proceedings pertaining to the Notes pending their delivery to the -6- Purchaser. The City Manager or the designee thereof is directed to submit for investigation, examination and approval by the Attorney General of the State of Texas the Notes and the proceedings authorizing their issuance, and to request the registration of the Notes and the proceedings authorizing their issuance by the Comptroller of Public Accounts of the State of Texas. The City Council hereby authorizes the payment of the fee of the Office of the Attorney General of the State of Texas for the examination of the proceedings relating to the issuance of the Notes, in the amount determined in accordance with the provisions of Section 1202.004, Texas Government Code. Section 15. FEDERAL TAX COVENANTS. TS. That the issuer covenants to and with the purchasers of the Notes to comply with the provisions of the Code. The Issuer's covenant to comply with the Code shall include, without limitation, compliance with those provisions of the Code regarding the timing of expenditure of proceeds of the Notes, the restriction on irivestnnent yields, the filing of information returns with the Internal Revenue Service, and, if required by the Code, the rebate of excess arbitrage earnings to the United States. Further, the Issuer certifies that based upon all facts and estimates now known or reasonably expected to be in existence on the date the Notes are delivered and paid for, the Issuer expects that the proceeds of the Notes will not be used in a manner that would cause the Notes or any portion of the Notes to be an "arbitrage bond" within the meaning of section 148 of the Code, and the regulations prescribed thereunder. Furthermore, the Mayor and each Authorized Representative is authorized and directed to provide certifications of facts and estimates that are material to the reasonable expectations of the Issuer as of the date the Notes are delivered and paid for. In particular, the Mayor and each Authorized Representative is authorized to certify for the Issuer the facts and circumstances and reasonable expectations of the Issuer on the date the Notes are delivered and paid for regarding the amount and use of the proceeds of the Notes. Moreover, the Issuer covenants to make such use of the proceeds of the Notes, regulate investments of proceeds of the Notes, take such other and further actions and follow such procedures, including, without limitation the method of calculating yield on the Notes, as may be required so that the interest on the Notes shall continue to be excluded from gross income for federal income tax purposes under the Code. The issuer further covenants that the proceeds of the Notes will not be used directly or indirectly so as to cause all or any part of the Notes to become a "private activity bond" within the meaning of section 141(a) of the Code. In complying with the provisions of this Section, the Issuer shall be entitled to rely upon an opinion of Bond Counsel. In furtherance thereof, the Issuer covenants as follows: (a) to take any action to assure that no more than ten percent of the proceeds of the Notes (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 ten percent of the proceeds are so used, that 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 ten percent of the debt service on the -7- Notes, in contravention of section 141(b)(2) of the Code; (b) to take any action to assure that in the event that the "private business use described in subsection (a) hereof exceeds five percent of the proceeds of the Notes (less amounts deposited into a reserve fund, if any), then the amount in excess of five 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; (c) to take any action to assure that no amount which is greater than the lesser of $5,000,000, or five percent of the proceeds of the Notes (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; (d) to refrain from taking any action which would otherwise result in the Notes being treated as "private activity bonds" within the meaning of section 141(b) of the Code; (e) to refrain from taking any action that would result in the Notes being "federally guaranteed" within the meaning of section 149(b) of the Code; (f) to refrain from using any portion of the proceeds of the Notes, 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 Notes, other than investment property acquired with -- 1proceeds of the Notes invested for a reasonable temporary period until such proceeds are needed for the purpose for which the Notes are issued, (2) amounts invested in a bona fide debt service fund, within the meaning of section 1.148-1(b) of the Treasury Regulations, and (3) amounts deposited in any reasonably required reserve or replacement fund to the extent such amounts do not exceed ten percent of the proceeds of the Notes; (g) to otherwise restrict the use of the proceeds of the Notes or amounts treated as proceeds of the Notes, as may be necessary, so that the Notes do not otherwise contravene the requirements of section 148 of the Code (relating to arbitrage) and, to the extent applicable, section 149(d) of the Code (relating to advance refundings); and -8- (h) to pay to the United States of America at least once during each five- year period (beginning on the date of delivery of the Notes) 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 Notes 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. In order to facilitate compliance with the above clause (h), a "Rebate Fund" is hereby established by the City for the sole benefit of the United States of America, and such Rebate Fund shall not be subject to the claim of any other person, including without limitation the registered owners of the Bonds. The Rebate Fund is established for the additional purpose of compliance with section 148 of the Code. 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 the issuance of the Bonds. 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 Notes, the Issuer will not be required to comply with any covenant contained herein to the extent that such modification or expansion, in the opinion of Bond Counsel, will not adversely affect the exemption from federal income taxation of interest on the Notes 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 Notes, the Issuer agrees to comply with the additional requirements to the extent necessary, in the opinion of Bond Counsel, to preserve the exemption from federal income taxation of interest on the Notes under section 103 of the Code. Section 16. ALLOCATION OF, AND LIMITATION ON, EXPENDITURES FOR ELIGIBLE PROJECTS. That the City covenants to account for on its books and records the expenditure of proceeds from the sale of the Notes and any investment earnings thereon to be used for the acquisition of the Projects by allocating proceeds to expenditures within 18 months of the later of the date that (a) the expenditure on the Projects is made or (b) each item of each Project is acquired. The foregoing notwithstanding, the City shall not expend such proceeds or investment earnings more than 60 days after the later of (a) the fifth anniversary of the date of delivery of the Notes or (b) the date the Notes are retired, unless the City obtains an opinion of Bond Counsel substantially to the effect that such expenditure will not adversely affect the tax-exempt status of the Notes. For purposes of this Section, the City shall not be obligated to comply with this covenant if it obtains an opinion of Bond Counsel to the effect that such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the interest. -9- Section 17. DISPOSITION OFELIGIBLEPF JECTS.ThattheCitycovenantsthat any item of the Projects will not be sold or otherwise disposed in a transaction resulting in the receipt by the City of cash or other compensation, unless the City obtains an opinion of Bond Counsel substantially to the effect that such sale or other disposition will not adversely affect the tax-exempt status of the Notes. For purposes of this Section, the portion of the property comprising personal property and disposed of in the ordinary course of business shall not be treated as a transaction resulting in the receipt of cash or other compensation. For purposes of this Section, the City shall not be obligated to comply with this covenant if it obtains an opinion of Bond Counsel to the effect that such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the interest. Section 18. DAMAGED, MUTIL TED, LOST, STOLEN, ORDESTI DESTROYED NOTES. (a) Notes. That in the event any outstanding Note is damaged, mutilated, Inst, stolen, or destroyed, the Paying Agent/Registrar shall cause to be printed, executed, and delivered, a new Note of the same principal amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or destroyed Note, in replacement for such Note in the manner hereinafter provided. (b) Application for Replacement ement Nates. Application for replacement of damaged, mutilated, lost, stolen, or destroyed Notes shall be made by the registered owner thereof to the Paying Agent/Registrar. In every case of loss, theft, or destruction of a Note, the registered owner applying for a replacement Note shall furnish to the issuer and to the Paying Agent/Registrar such security or indemnity as may be required by them to save each of them harmless from any loss or damage with respect thereto. Also, in every case of loss, theft, or destruction of a Note, the registered ownershall furnish to the Issuer and to the Paying Agent/Registrar evidence to their satisfaction of the loss, theft, or destruction of such Note, as the case may be. In every case of damage or mutilation of a Note, the registered owner shall surrender to the Paying Agent/Registrar for cancellation the Note so damaged or mutilated. No Default Occurred. Notwithstanding the foregoing provisions of this Section 18, in the event any such Note shall have matured, and no default has occurred which is then continuing in the payment of the principal of, redemption premium, if any, or interest on such Note, the Issuer may authorize the payment of the same (without surrender thereof except in the case of a damaged or mutilated Note) instead of issuing a replacement Note, provided security or indemnity is furnished as above provided in this Section 18. (d) Charge for Issuing Replacement ement Notes. Prior to the issuance of any replacement Note, the Paying Agent/Registrar shall charge the registered owner of such Note with all legal, printing, and other expenses in connection therewith. Every -10- replacement Note issued pursuant to the provisions of this Section 18 by virtue of the fact that any Note is lost, stolen, or destroyed shall constitute a Note of the Issuer whether or not the lost, stolen, or destroyed Note shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Ordinance equally and proportionately with any and all other Notes duly issued under this Ordinance. (e) Authority for Issuing Replacement ement Notes. In accordance with Subchapter D of Chapter 1201, this Section 18 of this Ordinance shall constitute authority for the issuance of any such replacement Note without necessity of further action by the Issuer or any other body or person, and the duty of the replacement of such Notes is hereby authorized and imposed upon the Paying Agent/Registrar, and the Paying Agent/Registrar shall authenticate and deliver such replacement Notes in the form and manner and with the effect, as provided in Section a f this Ordinance for Notes issued in conversion and exchange of other Notes. Section 19. CONTINUING DISCLOSURE UNDERTAKING. ING. a Annual Reports. rlts. That the City shall provide annually to each NRMSIR and any SID, within 180 days after the end of each Fiscal Year ending in or after 2008, financial information and operating data with respect to the City of the general type described in Exhibit C hereto. Any financial statements so to be provided shall be (1) prepared in accordance with the accounting principles described in Exhibit C hereto and audited, if the City commissions an audit of such statements and the audit is completed within the period during which they must be provided. If audited financial statements are not so provided, then the City shall provide unaudited financial statements when due under the Rule and further shall provide audited financial statements for the applicable Fiscal Year to each NRMSIR and any SID, when and if audited financial statements become available. If the City changes its Fiscal Year, it will notify each NRMSIR and any SID of the change (arid of the date of the new Fiscal Year end) prior to the next date by which the City othemise would be required to provide financial information and operating data pursuant to this Section. The 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, if it is available from the MSRB) that theretofore has been provided to each NRMSIR and any SID or filed with the SEC. (b) Material Event Notices. The City shall notify any SID and either each NRMSIR or the MSRB, in a timely manner, of any of the following events with respect to the Notes, if such event is material within the meaning of the federal securities laws: 1. Principal and interest payment delinquencies; 2. Non-payment related defaults; 3. Unscheduled draws on debt service reserves reflecting financial difficulties; 4. Unscheduled draws on credit enhancements reflecting financial -11- difficulties; 5. Substitution of credit or liquidity providers, or their failure to perform; 6. Adverse tax opinions or events affecting the tax-exempt status of the Notes; 7. Modifications to rights of holders of the Notes; 8. Note calls; 9. Defeasances; 10. Release, substitution, or sale of property securing repayment of the Notes; and 11. Rating changes. The City shall notify any SID and either each N RMSI R or the MSRB, in a timely manner, of any failure by the City to provide financial information or operating data in accordance with subsection (a) of this Section by the time required thereby. Any filing under this Section may be made solely by transmitting such filing to the MAC as provided at bjtp:I/www.disclosureusaorQ, unless the SEC has withdrawn the interpretive advice stated in its letter to the MAC dated September 7, 2004. (c) 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 Notes within the meaning of the Rule, except that the City in any event will give the notice required by subsection (b) of this Section of any Note calls and defeasance that cause the City no longer to be an "obligated person". The provisions of this Section are for the sole benefit of the holders and beneficial owners of the Notes, and nothing in this Section, express or implied, shall give any benefit or any legal or equitable right, remedy, or claim hereunder to any other person. The City undertakes to provide only the financial information, operating data, financial statements, and notices which it has expressly agreed to provide pursuant to this Section and does not hereby undertake to provide any other information that may be relevant or material to a complete presentation of the City's financial results, condition, or prospects or hereby undertake to update any information provided in accordance with this Section or otherwise, except as expressly provided herein. The City does not make any representation or warranty concerning such information or its usefulness to a decision to invest in or sell Notes at any future date. UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR BENEFICIAL OWNER OF ANY NOTE OR ANY OTHER PERSON, IN CONTRACTOR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE CITY, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE. -12- 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 ofoperationsofthe City, but only if 1 the provisions of this Section, as so amended, would have permitted an underwriter to purchase or sell Notes in the primary offering of the Notes 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 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 Notes consent to such amendment orb 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 Notes. 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 (a) 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. The City may also amend or repeal the provisions of this continuing disclosure requirement if the SEC amends or repeals the applicable provision of the Rule or a court of final jurisdiction enters judgment that such provisions of the Rule are invalid, but only if and to the extent that the provisions of this sentence would not prevent an underwriter from lawfully purchasing or selling Notes in the primary offering of the Notes. Section 20. DEFEASANCE. (a) Deemed Paid. That the principal of andior interest on and redemption premium, if any, on any Note shall be deemed to be paid, retired and no longer outstanding within the meaning of this Ordinance, except to the extent provided by subsection (d) of this Section, when payment of the principal of, redemption premium, if any, on such Note, plus interest thereon to the due date thereof (whether such due date be by reason of maturity, upon redemption, or otherwise) either (1) shalt have been made or caused to be made in accordance with the terms thereof, or (11)shall have been provided for by irrevocably depositing with, or making available to, a paying agent (or escrow agent) therefor, in trust and irrevocably set aside exclusively for such payment, (1) money sufficient to make such payment, (2) Defeasance Obligations, as hereinafter defined in this Section, certified by an independent public accounting firm of national reputation, to mature as to principal and interest in such amounts and at such times as will insure the availability, without reinvestment, of sufficient money to make such payment, and all necessary and proper fees, compensation, and expenses of such paying agent pertaining to the Notes with respect to which such deposit is made shall have been paid or the payment thereof provided for to the satisfaction of such paying agent, ora any -13- combination of and 2 above, and when i any required notice of redemption has been given or irrevocable provisions for the giving of such notice shall have been made and (11) proper arrangements have been made by the City with each such paying agent for the payment af its services until after all of the Notes so defeased shall have become due and payable. At such time as a Note shall be deemed to be paid hereunder, as aforesaid, it shall no longer be secured by or entitled to the benefit of this Ordinance or a lien on and pledge of the security granted in support of the payment of the Notes, and shall be entitled to payment solely from such money or Defeasance Obligations, and shall not be regarded as outstanding for any purposes other than payment, transfer, and exchange. (b) Retention of Rights. Notwithstanding the provisions of subsection (a), to the extent that, upon the defeasance of any Notes to be paid at maturity, the City retains the right, pursuant to Section 120 .0 , Texas Government Code, to later call such Notes for redemption in accordance with the provisions thereof, the City may call such Notes for redemption upon (1) in the proceedings providing for the defeasance of Notes, the City expressly reserves the right to call Notes for redemption, (2) the City giving notice of the reservation of that right to the owners of such Notes immediately following the establishment of the defeasance escrow, and (3) the City directing that notice of the reservation be included in any redemption notices that it may authorize, and upon satisfaction of the provisions of subsection (a) with respect to such Notes as though such Notes were being defeased at the time of the exercise of the option to redeem such Notes and the effect of the redemption is taken into account in determining the sufficiency of the provisions made for the payment of such Notes. Investments. Any escrow agreement or other instrument entered into by the City and a paying agent pursuant to which the money and/or Defeasance Obligations are being held by such paying agent for the payment of such Notes may contain provisions permitting the investment or reinvestment of such moneys in Defeasance Obligations or the substitution of other Defeasance Obligations upon the satisfaction of the requirements specified in subsection ai or (ii). All income from all Defeasance Obligations in the hands of the paying agent pursuant to this Section which is not required for the payment of the Notes, the redemption premium, if any, and interest thereon, with respect to which such money has been so deposited, shall be remitted to the City, or deposited as directed in writing by the City, and upon receipt of an opinion of bond counsel that such transfer is permitted under state law. (d) Federal Income Tax Consideration. The City covenants that no deposit will be made or accepted under subsection (a)(ii) of this Section and no use made of any such deposit which would cause such Notes to be treated as arbitrage bonds within the meaning of section 148 of the Code. (e) Defeasance Obligations. For the purpose of this Section, the term "Defeasance Obligations" shall mean (0 direct, noncallable obligations of the United States of America, including obligations that are unconditionally guaranteed by the United States of America, (11) noncallable obligations of an agency or instrumentality of the United States of America, including obligations that are unconditionally guaranteed or insured by the -14- agency or instrumentality and that, on the date the City adopts or approves proceedings authorizing the issuance of refunding bonds or, if such defeasance is not in connection with the issuance of refunding bonds, on the date the City provides for the funding of an escrow to effect the defeasance of the Notes, are rated as to investment quality by a nationally recognized investment rating firm not Less than AAA or its equivalent, and (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 City adopts or approves proceedings authorizing the issuance of refunding bonds or, if such defeasance is not in connection with the issuance of refunding bonds, on the date the City provides for the funding of an escrow to effect the defeasance of the Notes, are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent. (f) Continuing Duty of Paying Agent/Registrar. Until all Notes defeased under this Section of this Ordinance shall become due and payable, the Paying Agentlegistrar for such Notes shall perform the services of Paying Agent/Registrar for such Notes the same as if they had not been defeased, and the City shall make proper arrangements to provide and pay for such services. Section 21. SALE OF NOTES. That the sale of the Notes to Frost National Bank (the "Purchaser"), ata price of par, is hereby authorized, ratified and confirmed. One Note in the principal amount maturing on each maturity date as set forth in Section 2 hereof shall be delivered to the Purchaser, and the Purchaser shall have the right to exchange such Notes as provided in Section 5 hereof without cost. Section 22. DEFAULT AND REMEDIES. IES. a Events of Default. Each of the following occurrences or events for the purpose of this Ordinance is hereby declared to be an Event of Default: (1) the failure to make payment of the principal of or interest on any of the Notes when the same becomes due and payable; or it default in the performance or observance of any other covenant, agreement or obligation of the City, the failure to perform which materially, adversely affects the rights of the registered owners of the Notes, including, but not limited to, their prospect or ability to be repaid in accordance with this Ordinance, and the continuation thereof for a period of 60 days after notice of such default is given by any registered owner to the City. (b) Remedies for Default. (i) Upon the happening of any Event of Default, then and in every case, any registered owner or an authorized representative thereof, including, but not limited to, a trustee or trustees therefor, may proceed against the City, or any official, officer or employee of the City in their official capacity, for the purpose of protecting -15- and enforcing the rights of the registered owners under this Ordinance, by mandamus or other suit, action or special proceeding in equity or at law, in any court of competent jurisdiction, for any relief permitted by law, including the specific performance of any covenant or agreement contained herein, or thereby to enjoin any act or thing that may be unlawful or in violation of any right of the registered owners hereunder or any combination of such remedies. (ii) It is provided that all such proceedings shall be instituted and maintained for the equal benefit of all registered owners of Notes then outstanding. (c) Remedies Not Exclusive. (1) No remedy herein conferred or reserved is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or under the Notes or now or hereafter existing at law or in equity; provided, however, that notwithstanding any other provision of this Ordinance, the right to accelerate the debt evidenced by the Notes shall not be available as a remedy under this Ordinance. (li)The exercise of any remedy herein conferred or reserved shall not be deemed a waiver of any other available remedy. (iii) By accepting the delivery of a Note authorized under this Ordinance, such registered owner agrees that the certifications required to effectuate any covenants or representations contained in this Ordinance do not and shall never constitute or give rise to a personal or pecuniary liability or charge against the officers, employees or members of the City or the City Council. (iv)None of the members of the City Council, nor any other official or officer, agent, or employee of the City, shall be charged personally by the registered owners with any liability, or be held personally liable to the registered owners under any term or provision of this Ordinance, or because of any Event of Default or alleged Event of Default under this Ordinance. Section 23. MISCELLANEOUS PROVISIONS. (a) Preamble. The preamble to this Ordinance shall be considered an integral part of this Ordinance, and is herein incorporated as part of the body of this Ordinance for all purposes. (b) Immediate Effect. This Ordinance shall be effective immediately from and after its passage in accordance with the provisions of Section 1201.028, Texas Government Code. (c) Open Meeting. It is hereby officially found and determined that the meeting at which this Ordinance was passed was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by Chapter 551, Texas Government Code, as amended. (d) Rules of Construction. 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. Except where the context otherwise requires, terms defined in this Ordinance to impart the singular number shall be considered to include the plural number and vice versa. References to any named person means that party and its successors and assigns. References to any constitutional, statutory or regulatory provision means such provision as it exists on the date this Ordinance is adopted by the City and any future amendments thereto or successor provisions thereof. Any reference to the payment of principal in this Ordinance shall be deemed to include the payment of any mandatory sinking fund redemption payments as may be described herein. Any reference to FORM OF NOTE shall refer to the form attached to this Ordinance as Exhibit B. (e) Inconsistent Provisions. All orders and resolutions, or parts thereof, which are in conflict or inconsistent with any provision of this Ordinance are hereby repealed and declared to be inapplicable, and the provisions of this Ordinance shall be and remain controlling as to the matters prescribed herein. SIGNED AND SEALED THIS 20TH DAY OF MAY, 2008. City Secretary APPROVED: M at a 1, D-007 City Attorne _1 7 - Mayor, City of Corpus Christi, Texas Athvv% (SEAL) Schedule 1 1. South Guth Bali Fields Relocation Project $7,500,000 2. Improvements to facilities within Bayfront Arts and Sciences Park, $3,500,000 Such area to include American Bank Center, Museum of Science History, Water Garden, Harbor Playhouse, and Art Museum of South Texas, such improvements to include: Life Cycle Replacement Rehabilitation of Bayfront Arts and Sciences Park buildings and facilities including the American Bank Convention Center air handlers, chillers, cooling towers, controls, pumps, electrical, appurtenances and other Bayfront Park mechanical electrical systems 3. Solid Waste equipment to include: a. two side loaders refuse trucks at $235,000/each 470,000 b. three brush trucks at $82,000/each $ 246,000 c. two open top trailers with push blade for unloading $ 150,654 d. two truck tractors for hauling 45 foot trai EXHIBIT A "Chapter 9" shall mean Chapter 9, Texas Business & Commerce a Code. "Chapter 1201" shall mean Chapter 1201, Texas Government Code. "Chapter 1208" shall mean Chapter 1208, Texas Government Code. "Chapter 1431" shall mean Chapter 1431, Texas Government Code. "Authorized Denomination" shall mean Notes in the denomination of $5,000 or any integral multiple thereof. "Authorized Representative" shall mean one or more of the following officers or employees of the City, acting in concert or individually, to -wit: the City Manager, any Assistant City Manager, the Director of Financial Services, or such other officer or employee of the City designated in writing by the City Council to act as an Authorized Representative. "Bond Counsel" shall mean McCall, Parkhurst & Horton L.L.R., or such other attorney or firm of attorneys of such are nationally recognized as having expertise in the practice of tax-exempt municipal finance law as approved by the City. "City" or "Issuer" shall mean the City of Corpus Christi, Texas. "City Council" shall mean the City Council of the Issuer, its governing body. "Code" shall mean the Internal Revenue Code of 1986, as amended. "Fiscal Year" shall mean the twelve-month period ending July 31, or any consecutive twelve-month period declared by the City to be its fiscal year. "Interest and sinking Fund" shall mean the "City of Corpus Christi, Texas Tax Notes Series 2008 Interest and Sinking Fund" established by this Ordinance. "MAC" shall mean the Municipal Advisory Council of Texas "MSF B" shall mean the Municipal Securities Rulemaking ing Board. "Notes" shall mean the "City of Corpus Christi, Texas, Tax Notes, Series 2008", issued in the aggregate principal amount of $22,260,000. The term "Notes" shall mean and include the Notes initially issued and delivered pursuant to this Ordinance (including the Initial Notes) and all substitute Notes exchanged therefor, as well as all other substitute Notes and replacement Notes issued pursuant to the Ordinance, and the term "Note" shall mean any of the Notes. A-1 "NRMSIR" shall mean each person whom the SEC or its staff has determined to be a nationally recognized municipal securities information repository within the meaning of the Rule from time to time. "Ordinance" shall mean the Ordinance adopted by the Issuer authorizing the issuance of the Notes. "Paying AgentlRegistrar" shall mean Frost National Bank. "Payment Date" shall mean each date interest or principal on the Notes shall be due and payable. "Purchase Agreement" shall mean the Note Purchase Agreement between the City and the Purchaser, executed in connection with the sale and delivery of the Notes. "Purchaser" shall mean the initial purchaser of the Notes so designated in Section 21 of this Ordinance. "Registration Books" shall mean the books or records for the registration of the transfer and exchange of the Notes. "Rule" shall mean SEC Rule 15c2-12, as amended from time to time. "SEC" shall mean the United States Securities and Exchange Commission. "SID" shall mean any person designated by the State or an authorized department, officer, or agency thereof as, and determined by the SEC or its staff to be, a state information depository within the meaning of the Rule from time to time. "State" shall mean the State of Texas. A-2 N. R - EXHIBIT B FORM OF NOTE UNITED STATES OF AMERICA STATE OF TEXAS COUNTIES TIES F NUECES AND SAN PATRICIO CITY OF CORPUS CHRISTI, TEXAS TAX NOTE, SERIES 2008 INTEREST DATE OF MATURITY RATE INITIAL DELIVERY DATE 3.52%% June 24, 2008 REGISTERED OWNER: PRINCIPAL AMOUNT CUSIP N. PRINCIPAL AMOUNT: DOLLARS ON THE MATURITY DATE specified above, the CITY OF CORPUS CHRISTI, TEXAS (the "Issuer"), being a political subdivision of the State of Texas, hereby promises to pay to the Registered Owner set forth above, or registered assigns (hereinafter called the "registered owner") the principal amount set forth above and interest thereon from the Date of Initial Delivery of this Note as set forth above, on September 1, 2008 and on each March 1 and September 1 thereafter to the maturity date specified above, or the date fixed for redemption, at the interest rate per annum specified above; except that if the Paying Agent/Registrar's Authentication Certificate appearing on the face of this Note is dated later than September 1, 2008, such interest is payable on each March 1 and September 1 following such date. THE PRINCIPAL OF AND INTEREST ON this Note are payable in lawful money of the United States of America, without exchange or collection charges. The principal of this Note shall be paid to the registered owner hereof upon presentation and surrender of this Note at maturity at the designated corporate trust office in Corpus Christi, Texas of Frost National Bank, which is the "Paying AgentlRegistrar" for this Note. The payment of interest on this Note shall be made by the Paying Agent/Registrar to the registered owner hereof on each interest payment date by check orraft, dated as ofsuch interest payment date, drawn by the Paying AgentlRegistrar on, and payable solely from, funds of the Issuer required by the Ordinance authorizing the issuance of this Note (the "Ordinance") to be on deposit with the Paying Agent/Registrar for such purpose as hereinafter provided; and B-1 such check or draft shall be sent by the Paying AgentlRegistrar by United States mail, first- class postage prepaid, on each such interest payment date, to the registered owner hereof, at its address as it appeared on the fifteenth day of the month next preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described. Any accrued interest due at maturity shall be paid to the registered owner upon presentation and surrender of this Note for payment at the designated corporate trust office of the Paying Agent/Registrar. IN THE EVENT T of a non-payment of interest on a scheduled payment date, and for 30 days thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the Paying AentlRegistrar, if and when funds for the payment of such interest have been received from the Issuer. Notice of the Special Record Date and of the scheduled payment date of the past due interest ("Special Payment Date", which shall be 15 days after the Special Record Date) shall be sent at least five business days prior to the Special Record Date by United States mail, first class postage prepaid, to the address of each registered owner appearing on the registration books of the Paying Agent/Registrar at the close of business on the last business day next preceding the date of mailing of such notice. IF THE DATE for the payment of the principal of or interest on this Note shall be a Saturday, Sunday, a legal holiday, or a day on which banking institutions in the City where the designated 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 Saturday, Sunday, legal holiday, or day on which banking institutions are authorized to close; and payment on such date shall have the same force and effect as if made on the original date payment was due. THE ISSUER COVENANTS TS with the registered owner of this Note that on or before the principal and interest payment date for this Note it will make available to the Paying AgentlRegistrar, from the "Interest and Sinking Fund" created by the Ordinance, the amounts required to provide for the payment, in immediately available funds, of all princi- pal of and interest on the Notes, when due. THIS NOTE, dated as of May 1, 2008, is one of the series of notes authorized by the Ordinance to be issued in the aggregate principal amount of $22,260,000. This Note, and the series of which it is a part, is authorized pursuant to Chapter 1431, Texas Government Code ("Chapter 1431"), and issued for the purpose of PAYING CONTRACTUAL OBLIGATIONS INCURRED OR TO BE INCURRED FOR THE CONSTRUCTION F PUBLIC WORKS AND THE PURCHASE OF MATERIALS, SUPPLIES, EQUIPMENT, T, MACHINER , BUILDINGS, LANDS, AND RIGHTS-OF-WAY, as more fully described in the Ordinance, and to pay costs of issuance. This Note and the series of which it is a part is issued pursuant to the Ordinance passed and adopted by the City Council of the Issuer and duly recorded in the minutes of said City Council, as authorized by the Constitution and laws of the State of Texas, including Chapter 1431. B-2 ALL NOTES OF THIS SERIES are issuable solely as fully registered Notes, without interest coupons, in the denomination of any integral multiple of $5,000 (an "Authorized Denomination"). As provided in the Ordinance, this Note may, at the request of the registered owner or the assignee or assignees hereof, be assigned transferred, converted into and exchanged for a like aggregate principal amount of fully registered Notes, without interest coupons, payable to the appropriate registered owner, assignee or assignees, as the case may be, having the same denomination or denominations in any Authorized Denomination as requested in writing by the appropriate registered owner, assignee or assignees, as the case may be, upon surrender of this Note to the Paying Agent/Registrar for cancellation, all in accordance with the form and procedures set forth in the Ordinance. Among other requirements for such assignment and transfer, this Note must be presented and surrendered to the Paying Agent/Registrar, together with the proper instruments of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/Registrar, evidencing assignment of this Note or any portion or portions hereof in any Authorized Denomination to the assignee or assignees in whose name or names this Note or any such portion or portions hereof is or are to be registered. The form of Assignment printed or endorsed on this Note may be executed by the registered owner to evidence the assignment hereof, but such method is not exclusive, and other instruments of assignment satisfactory to the Paying Agent/Registrar may be used to evidence the assignment of this Note or any portion or portions hereof from time to time by the registered owner. In the case of the assignment, transfer, conversion or exchange of a Note or Notes or any portion or portions thereof, the reasonable standard or customary fees and charges of the Paying Agent/Registrar will be paid by the Issuer. In any circumstance, any taxes or governmental charges required to be paid with respect thereto shall be paid by the one requesting such assignment, transfer, conversion or exchange, as a condition precedent to the exercise of such privilege. IN THE EVENT any Paying Agent/Registrar for the Notes is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Ordinance that it promptly will appoint a competent and legally qualified substitute therefor, and cause written notice thereof to be mailed to the registered owners of the Notes. IT IS HEREBY CERTIFIED AND REPRESENTED ESENTED that this Note has been duly and validly authorized, issued and delivered; that all acts, conditions and things required or proper to be performed, exist and be done precedent to or in the authorization, issuance and delivery of this Note have been performed, existed and been done in accordance with law; that this Note constitutes an obligation of said Issuer; and that annual ad valorem taxes sufficient to provide for the payment of the interest on and principal of this Note, as such interest comes due and such principal matures, have been levied and ordered to be levied against all taxable property in said Issuer, and have been pledged from the Issuer's annual ad valorem tax for such payment, within the limits prescribed by law. Reference is made to the Ordinance for a more complete description of the Issuer's obligation to provide for the payment of the principal of and interest on the Notes. By acceptance of this Note, the registered owner expressly assents to all provisions of the Ordinance. B-3 IN WITNESS ESS WHEF E F, the Issuer has caused this Note to be signed with the manual or facsimile signature of the Mayor of said City, and attested with the manual or facsimile signature of the City Secretary and the official seal of the Issuer has been duly affixed to, or impressed, or placed in facsimile, on this Note. (signature) sl nature City Secretary Mayor, City of Corpus Christi, Texas City of Corpus Christi, Texas (SEAL) - . 1 13-4 FORM OF ASSIGNMENT ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto Please insert Social Security or Taxpayer Identification Number of Transferee (Please print or typewrite name and address, including zip code of Transferee) the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints , attorney, to register the transfer of the within Note on the books kept for registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed: NOTICE: Signature(s) must be guaranteed by a member firm of the New York Stock Exchange or a commercial bank or trust company. B-5 NOTICE: The signature above must correspond with the name of the registered owner as it appears upon the front of this Note in every particular, with- out alteration or enlargement or any change whatsoever. FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE PAYING AGENT REGISTRAR'S AUTHENTICATION I CERTIFICATE It is hereby certified that this Note has been issued under the provisions of the Ordinance described in the text of this Note; that this Note has been duly authenticated; and that this Note has been issued in exchange for or replacement of a note, notes, or a portion of a note or notes of an issue, the proceedings pursuant to which such issue was authorized were approved by the Attorney General of the State of Texas. Dated: Paying Agent/Registrar By _. Authorized Representative B-6