Constituting the Nineteenth Supplemental Ordinance to the General Gas Works Revenue Bond Ordinance of 1975 (the "1975 General Ordinance"); authorizing the Mayor, the City Controller and the City Solicitor, or a majority of them, to sell, either at public or private sale, Gas Works Revenue Bonds, Nineteenth Series (1975 General Ordinance), of the City of Philadelphia, in one or more subseries (the "Nineteenth Series Bonds") to be issued to pay the cost of refunding or redeeming all or a portion of certain outstanding Gas Works Revenue Bonds and other Project Costs, as hereinafter more particularly described, and authorizing the application of proceeds of the Nineteenth Series Bonds for such purposes; authorizing the City of Philadelphia to obtain credit enhancement for the Nineteenth Series Bonds; authorizing the City of Philadelphia to enter into swap agreements or exchange agreements with respect to the Nineteenth Series Bonds; determining the sufficiency of Project Revenues; covenant...

THE COUNCIL OF THE CITY OF PHILADELPHIA HEREBY ORDAINS:

SECTION 1. The Mayor, the City Controller and the City Solicitor (the "Bond Committee"), or a majority of them, are hereby authorized, on behalf of the City of Philadelphia (the "City"), to borrow, by the issuance and sale of Gas Works Revenue Bonds, Nineteenth Series, of the City of Philadelphia (the "Nineteenth Series Bonds"), in one or more subseries and with such relative priorities as they deem desirable, pursuant to The First Class City Revenue Bond Act of October 18, 1972, Act No. 234 (the "Act") and the General Gas Works Revenue Bond Ordinance of 1975, Bill No. 1871 (approved May 30, 1975), as amended (the "1975 General Ordinance"), a sum or sums which in the aggregate shall not exceed the principal amount of Nineteenth Series Bonds authorized to be issued hereunder, to be expended as provided in Section 2 of this Ordinance. The Nineteenth Series Bonds shall be sold at public or private sale and shall contain such terms and provisions as are determined by a majority of the Bond Committee to be in the best interest of the City and are not inconsistent with the provisions hereof, of the Act or of the 1975 General Ordinance or any other applicable law. If a majority of the Bond Committee determines it to be in the best interest of the City, the Nineteenth Series Bonds may be issued in book-entry form; and in such event a majority of the Bond Committee shall also select a securities depository (the "Depository") for the Nineteenth Series Bonds. If a majority of the Bond Committee determines it to be in the best interest of the City, the City may obtain credit enhancement for all or a portion of the Nineteenth Series Bonds. If a majority of the Bond Committee determines it to be in the best interest of the City, the City may enter into swap agreements or exchange agreements with respect to the Nineteenth Series Bonds upon such terms and conditions as provided by the Bond Committee and which terms and conditions are not inconsistent with the requirements of the 1975 General Ordinance and any other applicable law. The Nineteenth Series Bonds shall mature or be subject to mandatory redemption in such principal amounts and on such dates, shall bear interest from such date or dates and at such rate or rates (including, without limitation, variable, adjustable or convertible rates), all as shall be determined by the Bond Committee. A majority of the Bond Committee is further authorized to take any and all other actions as may be necessary or appropriate in connection with the consummation of the transactions contemplated herein.

The Nineteenth Series Bonds are authorized to be issued hereunder in an aggregate principal amount up to Sixty Million Dollars ($60,000,000); provided that, if any of the Nineteenth Series Bonds are to be sold at discounts which are in lieu of periodic interest, the aggregate principal amount of the Nineteenth Series Bonds which may be issued hereunder shall be increased to reflect such discounts, as long as the aggregate gross proceeds to the City from the sale of the Nineteenth Series Bonds shall not exceed Sixty Million Dollars ($60,000,000), plus accrued interest, if any.

The Nineteenth Series Bonds shall not pledge the City's credit or taxing power, create any debt or charge against the tax or general revenues of the City or create any lien against any property of the City other than the revenues pledged by the 1975 General Ordinance. The opinion of the City Solicitor required by Section 8 of the Act with respect to the matters stated in the preceding sentence has been filed with City Council and shall be kept on file at the office of the Clerk of City Council.

SECTION 2. The Nineteenth Series Bonds shall be issued for the purpose of providing funds for any and all of the following purposes (the "Refunding Project"): (i) the refunding and redeeming all or any portion of the outstanding City of Philadelphia, Pennsylvania, Gas Works Revenue Bonds, Fifteenth Series (1975 General Ordinance) together with such other Gas Works Revenue Bonds, upon such terms and in such amounts as shall be determined by the Director of Finance (the "Prior Bonds"); (ii) paying the costs of issuing the Nineteenth Series Bonds and any required deposits to the Sinking Fund Reserve; and (iii) paying any other Project Costs (as defined in the Act) relating to the refunding of the Prior Bonds or the issuance of the Nineteenth Series Bonds which may include, without limitation, the repayment to any fund of the City or to the accounts of the Philadelphia Gas Works (the "Gas Works") of amounts advanced for Project Costs, and the funding or refunding of outstanding bond anticipation notes or other obligations of the City issued in respect of Project Costs.

The City covenants that the proceeds of the Nineteenth Series Bonds which remain available for the payment of the costs of refunding and redemption of the Prior Bonds, after payment of the financing costs, and the required payment into the Sinking Fund Reserve, shall be deposited, held in and disbursed from a special account of the Sinking Fund or the escrow fund to be established pursuant to the Escrow Agreement (defined below).

The City hereby authorizes the redemption of the Prior Bonds in accordance with the terms of the 1975 General Ordinance and the Prior Bonds and further authorizes the Bond Committee or the Director of Finance to enter into an Escrow Agreement (the "Escrow Agreement") providing, among other things, for the deposit and investment of all or a portion of the Nineteenth Series Bond proceeds and any other available funds of the City in amounts sufficient, together with interest thereon, if any, to defease the lien of such Prior Bonds and providing for payment of the Prior Bonds at maturity or redemption, as applicable, including all interest payable on such Prior Bonds to such maturity or redemption dates, as applicable. All interest and income earned, if any, on the investment of such proceeds (except for amounts to be rebated to the United States), which is not required for the Refunding Project, pending expenditure for the aforesaid purposes may be transferred to and deposited in the operating funds of the Gas Works and applied as Project Revenues in accordance with Section 4.02 of the 1975 General Ordinance.

The Director of Finance is hereby authorized to determine, on behalf of the City, the particular series and maturities of the Prior Bonds to be refunded, the amount of Nineteenth Series Bond proceeds to be applied to the refunding of the Prior Bonds and to deposit such proceeds in an escrow account for the benefit of the holders of the refunded Prior Bonds, and to take any and all other action, including the irrevocable pledge of such proceeds and/or the income or profit from the investment thereof, for the payment and redemption of the refunded Prior Bonds, and the publication of all required redemption notices or the giving of irrevocable instructions therefor, as may be necessary or appropriate to accomplish the refunding of the Prior Bonds and to comply with the requirements of Section 10 of the Act.

SECTION 3. Based on the report of the Director of Finance of the City required by Section 8 of the Act (the "Financial Report"), it is hereby determined that the pledged Project Revenues (as defined in the 1975 General Ordinance) will be sufficient to comply with the rate covenant contained in Section 4.03(b) of the 1975 General Ordinance and also to pay all costs, expenses and payments required to be paid therefrom in the order and priority stated in Section 4.02 of the 1975 General Ordinance. An executed copy of the Financial Report has been filed with City Council and shall be kept on file at the office of the Clerk of City Council.

SECTION 4. The City covenants that, as long as any of the Nineteenth Series Bonds shall remain outstanding, all pledged Project Revenues shall be deposited and held in and disbursed from one or more unsegregated accounts of the Gas Works which shall be separate from and not commingled with the consolidated cash account of the City or any other account of the City not held exclusively for Gas Works purposes. Such pledged Project Revenues shall be held for the security and payment of the Nineteenth Series Bonds and all Bonds issued under the 1975 General Ordinance to the extent and, to be applied in the order of priority, set forth in Section 4.02 of the 1975 General Ordinance. This covenant shall not be construed to require the establishment of any Gas Works account segregated from any other Gas Works accounts except as provided in Section 2 hereof or as otherwise required by the 1975 General Ordinance.

SECTION 5. The City covenants that, as long as any Nineteenth Series Bonds shall remain unpaid, it shall make payments or cause payments to be made out of its Gas Works Revenue Bond Sinking Fund created under the 1975 General Ordinance at such times and in such amounts as shall be sufficient for the payment of the interest thereon and the principal thereof when due; provided, however, that whenever the City shall be required to deposit moneys with the Fiscal Agent for the mandatory redemption of any of the Nineteenth Series Bonds, such obligation may be satisfied, in whole or in part, by the delivery by the City to the Fiscal Agent of a principal amount of Nineteenth Series Bonds of the maturity required to be redeemed for cancellation prior to the date specified for such redemption.

SECTION 6. The Director of Finance is authorized to make such elections under the Internal Revenue Code of 1986, as amended (the "Code"), and Treasury Regulations promulgated thereunder with respect to the Nineteenth Series Bonds and to take such actions on behalf of the City with respect to the investment of the proceeds of the Nineteenth Series Bonds as is deemed advisable, and the Director of Finance or any member of the Bond Committee is authorized to make such covenants as may be necessary or advisable in order that the Nineteenth Series Bonds shall not be "arbitrage bonds" as defined in the Code.

SECTION 7. In the event Nineteenth Series Bonds are issued in book-entry form, the ownership of one fully registered Nineteenth Series Bonds for each maturity, each in the aggregate principal amount of such maturity, will be registered in the name(s) designated by the Depository. So long as, but only so long as, the book-entry only system is applicable to the Nineteenth Series Bonds, the following provisions of this Section 7 shall govern as to the applicable matters set forth In Article III of the 1975 General Ordinance.

Pursuant to the book entry only system, ownership interests in the Nineteenth Series Bonds may be purchased in the manner directed by the Depository, which may be through financial institutions for whom the Depository effects book-entry transfers (the "Participants"). A person who owns such an interest in the Nineteenth Series Bonds (a "Beneficial Owner") will not receive certificated Nineteenth Series Bonds and will not be the registered owner thereof. Receipt by the Beneficial Owners of timely payment of principal, purchase price, redemption price and interest on the Nineteenth Series Bonds, is subject to the Depository's making such timely payment, either to the Beneficial Owner or to the Participants to be forwarded to the Beneficial Owners. Neither the City nor the Fiscal Agent will have any responsibility or obligation to such Participants or to the Beneficial Owners for any failure of the Depository to act or make any payment with respect to the Nineteenth Series Bonds or the providing of notices relating to redemption or mandatory tender to Participants or the Beneficial Owners of the Nineteenth Series Bonds.

The Depository will receive payments from the Fiscal Agent to be remitted by the Depository to the Beneficial Owners or to the Participants for whom the Depository holds the Nineteenth Series Bonds for subsequent disbursement to the Beneficial Owners. The ownership interest of each Beneficial Owner in the Nineteenth Series Bonds shall be recorded on the records of the Depository or the records of the Participants, whose ownership interests will be recorded on the records of the Depository.

When notices are given, they shall be sent by the Fiscal Agent to the Depository with a request that the Depository forward (or cause to be forwarded) the notice to the Participants so that such Participants may forward (or cause to be forwarded) the notices to the Beneficial Owners.

Transfers of ownership interests in the Nineteenth Series Bonds will be accomplished by book-entries made by the Depository and/or the Participants who act on behalf of the Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the Nineteenth Series Bonds, except as specifically provided herein. So long as the Depository is the Bondholder, interest, principal and redemption price of the Nineteenth Series Bonds will be paid when due by the Fiscal Agent to the Depository, then paid by the Depository to the Beneficial Owners, or by the Depository to the Participants and thereafter paid by the Participants to the Beneficial Owners. The payments to the Depository shall satisfy the City's obligations under the Nineteenth Series Bonds.

For every transfer and exchange of the Nineteenth Series Bonds, the Fiscal Agent, the Depository and the Participants may charge the Beneficial Owner of the Nineteenth Series Bonds a sum sufficient to cover any tax, fee or other governmental charge that may be imposed in relation thereto. No transfer or exchange of any Nineteenth Series Bonds shall be required to be made fewer than fifteen (15) days prior to any interest payment date or fifteen (15) days prior to any mailing of a notice of redemption of the Nineteenth Series Bonds. No transfers shall be made of Nineteenth Series Bonds previously called for redemption, except pursuant to any optional or mandatory tender provisions thereof.

The Depository may determine to discontinue providing its services with respect to the Nineteenth Series Bonds at any time by giving notice to the City and the Fiscal Agent and discharging its responsibilities with respect thereto under applicable law. Under such circumstances (if there is no successor securities depository), the City is obligated to deliver bond certificates in such names as the City and the Fiscal Agent are directed by the Depository.

The Bondholders have no right to a depository for the Nineteenth Series Bonds. If the book-entry only system is no longer utilized, bond certificates will be issued in such names as the City and Fiscal Agent are directed by the Depository.

Notwithstanding any other provision of the 1975 General Ordinance, so long as the Depository is the registered Bondholder of all Nineteenth Series Bonds, the Depository may present notices, approvals, waivers or other communications required or permitted to be made by bondholders under the 1975 General Ordinance on a fractionalized basis on behalf of some or all of the Beneficial Owners.

The appropriate officials of the City are authorized to execute any documentation required by the Depository in connection with book-entry registration of the Nineteenth Series Bonds.

SECTION 8. Section 6.04 of the 1975 General Ordinance is hereby amended by adding the following paragraph at the end thereof:

The Sinking Fund Reserve shall be valued at the current market value thereof by the Sinking Fund Depository promptly after any withdrawal from the Sinking Fund Reserve or any other event indicating a possible deficiency in the Sinking Fund Reserve and on August 31 of each Fiscal Year. Investment earnings on the Sinking Fund Reserve shall be included in Gas Works Revenues and, to the extent not required to be retained in the fund or account to which such earnings relate shall be transferred to the operating accounts of the Gas Works.

SECTION 9. This Ordinance is supplementary to the 1975 General Ordinance and all sections of the 1975 General Ordinance not modified, amended or superseded by this Ordinance are applicable to the Nineteenth Series Bonds. All definitions of terms contained in the Act or the 1975 General Ordinance not inconsistent herewith shall apply to such terms in this Ordinance.

SECTION 10. This Ordinance shall take effect immediately.

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