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<br />BOND INFORMATION
<br />Authority for Issuance
<br />The Bonds were authorized at elections held on various dates. The City is authorized to incur debt by
<br />voter authorization by Article 1175 of the general laws of the State of Texas and by Ordinance as
<br />authorized in the City Charter adopted by voters on February 24, 1967.
<br />Security for Bonds
<br />All taxable property within the City is subject to a continuing direct annual ad valorem tax levied by the
<br />City sufficient to provide for the payment of principal of and interest on all obligations payable in whole
<br />or in part from ad valorem taxes, which tax must be levied within limits prescribed by law. The City
<br />operates under a home-rule charter as authorized by Article XI, Section 5 of the Constitution of the State
<br />of Texas. The City's charter restricts such tax levy to no more than $2.50 per $100 of Assessed Valuation
<br />for payment of debt.
<br />Retlemption of Bonds
<br />The City reserves the right, at its option, to redeem Bonds having stated maturities on and after
<br />August 1,2001, in whole or in part in principal amounts of $5,000 or any integral multiple thereof, on
<br />August 1, 2000, or any date thereafter, at the par value thereof plus accrued interest to the date fixed for
<br />redemption. If less than all of the Bonds are to be redeemed and if less than all of a maturity is to be
<br />redeemed, the Paying Agent/Registrar shall determine by lot the Bonds, or portions thereof, within such
<br />maturity to be redeemed.
<br />Not less than 30 days prior to a redemption date for the Bonds, the City shall cause a notice of
<br />redemption to be sent by United States mail, first class, postage prepaid, to each registered owner of a
<br />Bond to be redeemed, in whole or in part, at the address of the registered owner appearing on the
<br />registration books of the Paying Agent/Registrar at the close of business on the business day next
<br />preceding the date of mailing such notice. Any notice of redemption so mailed shall be conclusively
<br />presumed to have been duly given irrespective of whether received by the bondholder.
<br />Paying Agent/Registrar
<br />The initial Paying Agent/Registrar is Ameritrust Texas, N. A., Austin, Texas. In the Ordinance the City
<br />retains the right to replace the Paying Agent/Registrar. The City covenants to maintain and provide a
<br />Paying Agent/Registrar at all times while the Bonds are outstanding and any successor Paying
<br />Agent/Registrar shall be a commercial bank or trust company organized under the laws of the State of
<br />Texas or other entity duly qualified and legally authorized to serve as and perform the duties and services
<br />of Paying Agent/Registrar for the Bonds. Upon any change in the Paying Agent/Registrar for the Bonds,
<br />the City agrees to promptly cause a written notice thereof to be sent to each registered owner of the
<br />Bonds by United States mail, first class, postage prepaid, which notice shall also give the address of the
<br />new Paying Agent/Registrar.
<br />Principal of the Bonds will be payable to the registered 9wner at maturity or prior redemption upon
<br />presentation at the principal office of the Paying Agent/Registrar. Interest on the Bonds will be payable
<br />by check, dated as of the interest payment date, and mailed by the Paying Agent/Registrar to registered
<br />owners as shown on the records of the Paying Agent/Registrar on the Record Date (see "Record Date for
<br />Interest Payment" herein), or by such other method, acceptable to the Paying Agent/Registrar, requested
<br />by, and at the risk and expense of, the registered owner. If the date for the payment of the principal of or
<br />interest on the Bonds shall be a Saturday, Sunday, legal holiday, or day on which banking institutions in the
<br />city where the Paying Agent/Registrar is located are authorized by law or executive order to close, then
<br />the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal
<br />holiday, or day on which banking institutions are authorized to close; and payment on such date shall have
<br />the same force and effect as if made on the original date payment was due.
<br />Transfer, Exchange and Registration
<br />The Bonds may be transferred and exchanged on the registration books of the Paying Agent/Registrar only
<br />upon presentation and surrender thereof to the Paying Agent/Registrar and such transfer or exchange
<br />shall be without expense or service charge to the registered owner, except for any tax or other
<br />governmental charges required to be paid with respect to such registration, exchange and transfer. A
<br />Bond may be assigned by the execution of an assignment form on the Bond or by other instrument of
<br />transfer and assignment acceptable to the Paying Agent/Registrar. A new Bond or Bonds will be delivered
<br />by the Paying Agent/Registrar, in lieu of the Bond being transferred or exchanged, at the principal office
<br />of the Paying Agent/Registrar, or sent by United States mail, first class, postage prepaid, to the new
<br />registered owner or his designee. To the extent possible, new Bonds issued in an exchange or transfer of
<br />Bonds will be delivered to the registered owner or assignee of the registered owner in not more than three
<br />business days after the receipt of the Bonds to be cancelled, and the written instrument of transfer or
<br />request for exchange duly executed by the registered owner or his duly authorized agent, in form
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