ORD 2013-17Og,j ova Qn)3 -)7
CERTIFICATION PERTAINING TO
PASSAGE OF AN ORDINANCE
STATE OF TEXAS §
TOWN OF TROPHY CLUB §
On the 5th day of August, 2013, Town Council of the Town of Trophy Club, Texas,
convened in a regular meeting at the regular meeting place thereof, the meeting being open to the
public and notice of said meeting, giving the date, place and subject thereof, having been posted
as prescribed by Chapter 551, Texas Government Code, as amended; and the roll was called of
the duly constituted officers and members of the Town Council, which officers and members are
as follows:
Connie White, Mayor Bill Rose )
Jeannette Tiffany, Mayor Pro Tem Greg Lamont )
Clint Schroeder ) Members of
Danny Mayer ) the Council
and all of said persons were present thus constituting a quorum. Whereupon, among other
business, a written ordinance bearing the following caption was introduced:
AN ORDINANCE AUTHORIZING THE ISSUANCE OF TOWN
OF TROPHY CLUB, TEXAS, COMBINATION TAX AND
REVENUE CERTIFICATES OF OBLIGATION, SERIES 2013
IN THE APPROXIMATE AGGREGATE PRINCIPAL
AMOUNT OF $3,000,000; AWARDING THE SALE OF THE
CERTIFICATES; LEVYING A TAX, AND PROVIDING FOR
THE SECURITY FOR AND PAYMENT OF SAID
CERTIFICATES; AUTHORIZING THE EXECUTION OF AN
AGREEMENT FOR FINANCIAL ADVISORY SERVICES;
APPROVING THE OFFICIAL STATEMENT; ENACTING
OTHER PROVISIONS RELATING TO THE SUBJECT; AND
DECLARING AN EFFECTIVE DATE
The Ordinance, a full, true and correct copy of which is attached hereto, was read and
reviewed by the Town Council.
Thereupon, it was duly moved and seconded that the Ordinance be finally passed and
adopted.
The Presiding Officer put the motion to a vote of the members of the Town Council, and
the Ordinance was finally passed and adopted by the following vote:
AYES: 6
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NAYS: 0 ABSTENTIONS: 0
THIS CERTIFICATE IS CERTIFIED TO BE TRUE AND CORRECT, and to correctly
reflect the duly constituted officers and members of the Town Council of said Town, and the
attached and following copy of said Ordinance is hereby certified to be a true and correct copy of
an offi ' 1 copy thereof on file among the official records of the Town, all on this the ,ay
of ,,, , , 2013.
Town Secretary, ToxWfof Trophy Club, Texas
ORDINANCE
relating to
$3,000,000
TOWN OF TROPHY CLUB, TEXAS
COMBINATION TAX AND REVENUE
CERTIFICATES OF OBLIGATION
SERIES 2013
Adopted: August 5, 2013
Dated: August 1, 2013
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND OTHER PRELIMINARY MATTERS
Section1.01. Definitions................................................................................................................2
Section1.02. Findings....................................................................................................................4
Section 1.03. Table of Contents, Titles, and Headings..................................................................4
Section1.04. Interpretation............................................................................................................5
ARTICLE II
SECURITY FOR THE CERTIFICATES; INTEREST AND SINKING FUND
Section 2.01. Payment of the Certificates......................................................................................5
Section 2.02. Interest and Sinking Fund........................................................................................6
ARTICLE III
AUTHORIZATION; GENERAL TERMS AND PROVISIONS
REGARDING THE CERTIFICATES
Section3.01. Authorization...........................................................................................................7
Section 3.02. Date, Denomination, Maturities, and Interest..........................................................7
Section 3.03. Medium, Method, and Place of Payment.................................................................8
Section 3.04. Execution and Registration of Certificates..............................................................9
Section3.05. Ownership..............................................................................................................10
Section 3.06. Registration, Transfer, and Exchange....................................................................10
Section3.07. Cancellation...........................................................................................................11
Section 3.08. Temporary Certificates..........................................................................................11
Section 3.09. Replacement Certificates.......................................................................................12
Section 3.10. Book -Entry -Only System.......................................................................................13
Section 3.11. Successor Securities Depository; Transfer Outside Book -Entry -Only System..... 13
Section 3.12. Payments to Cede & Co.........................................................................................14
ARTICLE IV
REDEMPTION OF CERTIFICATES BEFORE MATURITY
Section 4.01. Limitation on Redemption.....................................................................................14
Section 4.02. Optional Redemption.............................................................................................14
Section 4.03. Partial Redemption.................................................................................................15
Section 4.04. Notice of Redemption to Owners..........................................................................16
Section 4.05. Payment Upon Redemption...................................................................................16
Section 4.06. Effect of Redemption.............................................................................................16
(i)
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Section 4.07. Conditional Notice of Redemption........................................................................17
Section4.08. Lapse of Payment...................................................................................................17
ARTICLE V
PAYING AGENT/REGISTRAR
Section 5.01.
Appointment of Initial Paying Agent/Registrar.....................................................17
Section5.02.
Qualifications.........................................................................................................18
Section 5.03.
Maintaining Paying Agent/Registrar.....................................................................18
Section5.04.
Termination............................................................................................................18
Section 5.05.
Notice of Change to Owners..................................................................................18
Section 5.06.
Agreement to Perform Duties and Functions.........................................................18
Section 5.07.
Delivery of Records to Successor..........................................................................18
ARTICLE VI
FORM OF THE CERTIFICATES
Section6.01. Form Generally......................................................................................................19
Section 6.02. Form of the Certificates.........................................................................................19
Section 6.03. CUSIP Registration................................................................................................26
Section6.04. Legal Opinion........................................................................................................26
Section 6.05. Statement Insurance...............................................................................................26
ARTICLE VII
SALE AND DELIVERY OF CERTIFICATES;
DEPOSIT OF PROCEEDS; FLOW OF FUNDS
Section 7.01. Sale of Certificates; Official Statement.................................................................26
Section 7.02. Control and Delivery of Certificates......................................................................27
Section 7.03. Deposit of Proceeds...............................................................................................28
ARTICLE VIII
INVESTMENTS
Section8.01. Investments............................................................................................................28
Section 8.02. Investment Income.................................................................................................28
ARTICLE IX
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 9.01. Payment of the Certificates....................................................................................29
Section 9.02. Other Representations and Covenants...................................................................29
Section 9.03. Provisions Concerning Federal Income Tax Exclusion.........................................29
(ii)
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Section 9.04.
No Private Use or Payment and No Private Loan Financing.................................30
Section 9.05.
No Federal Guaranty..............................................................................................30
Section 9.06.
Certificates are not Hedge Certificates..................................................................30
Section 9.07.
No -Arbitrage Covenant..........................................................................................30
Section 9.08.
Arbitrage Rebate....................................................................................................30
Section 9.09.
Information Reporting...........................................................................................31
Section 9.10.
Continuing Obligation...........................................................................................31
Section 9.11.
Qualified Tax -Exempt Obligations........................................................................32
ARTICLE X
DEFAULT AND REMEDIES
Section 10.01. Events of Default...................................................................................................32
Section 10.02. Remedies for Default.............................................................................................32
Section 10.03. Remedies Not Exclusive........................................................................................33
ARTICLE XI
DISCHARGE
Section11.01. Discharge...............................................................................................................33
ARTICLE XII
CONTINUING DISCLOSURE UNDERTAKING
Section12.01. Annual Reports......................................................................................................33
Section 12.02. Material Event Notices..........................................................................................34
Section 12.03. Limitations, Disclaimers and Amendments...........................................................35
ARTICLE XIII
AMENDMENTS
Section13.01. Amendments..........................................................................................................36
ARTICLE XIV
MISCELLANEOUS
Section 14.01. Changes to Ordinance............................................................................................37
Section 14.02. Partial Invalidity.....................................................................................................37
Section 14.03. No Personal Liability.............................................................................................37
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RMIMMMA
EFFECTIVENESS
Section 15.01. Effectiveness..........................................................................................................37
EXHIBIT A - Description of Annual Disclosure of Financial Information
(iv)
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TOWN OF TROPHY CLUB, TEXAS
ORDINANCE NO. 2013-17
AN ORDINANCE AUTHORIZING THE ISSUANCE OF
$3,000,000 TOWN OF TROPHY CLUB, TEXAS,
COMBINATION TAX AND REVENUE CERTIFICATES OF
OBLIGATION, SERIES 2013; LEVYING A TAX, AND
PROVIDING FOR THE SECURITY FOR AND PAYMENT
OF SAID CERTIFICATES; AUTHORIZING THE
EXECUTION OF AN AGREEMENT FOR FINANCIAL
ADVISORY SERVICES; APPROVING THE OFFICIAL
STATEMENT; ENACTING OTHER PROVISIONS
RELATING TO THE SUBJECT; AND DECLARING AN
EFFECTIVE DATE.
WHEREAS, under the provisions of the Texas Local Government Code, Chapter 271,
Subchapter C, as amended, the Town of Trophy Club, Texas (the "Town"), is authorized to issue
certificates of obligation for the purposes specified in this Ordinance and for the payment of all
or a portion of the contractual obligations for professional services, including that of engineers,
attorneys, and financial advisors in connection therewith, and to sell the same for cash as herein
provided; and
WHEREAS, the Town is authorized to provide that such obligations will be payable
from and secured by the levy of a direct and continuing ad valorem tax against all taxable
property within the Town, in combination with all or a part of certain revenues of the Town's
municipal drainage utility system (the "System") remaining after payment of any obligations of
the Town payable in whole or in part from a lien on or pledge of such revenues that would be
superior to the obligations to be authorized herein as authorized by Chapter 1502, Texas
Government Code; and
WHEREAS, the Town Council has found and determined that it is necessary and in the
best interests of the Town and its citizens that it issue such certificates of obligation authorized
by this Ordinance; and
WHEREAS, pursuant to a resolution heretofore passed by this governing body, notice of
intention (the "Notice of Intention") to issue certificates of obligation of the Town payable as
provided in this Ordinance was published in a newspaper of general circulation in the Town in
accordance with the requirements of law, such certificates of obligation to be issued for the
purpose of paying contractual obligations to be incurred for the purposes set forth in Section 3.01
hereof; and
WHEREAS, the Notice of Intention stated that the Town Council intended to pass an
ordinance authorizing the issuance of the Certificates at its Town Council meeting held on the
date of adoption of this Ordinance; and
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WHEREAS, no petition of any kind has been filed with the Town Secretary, any
member of the Town Council or any other official of the Town, protesting the issuance of such
certificates of obligation; and
WHEREAS, this Town Council is now authorized and empowered to proceed with the
issuance of said certificates of obligation and to sell the same for cash; and
WHEREAS, the meeting at which this Ordinance is considered is 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 Chapter 551, Texas Government Code, as amended; therefore,
BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF TROPHY
CLUB, TEXAS, THAT:
ARTICLE I
DEFINITIONS AND OTHER PRELIMINARY MATTERS
Section 1.01. Definitions.
Unless otherwise expressly provided or unless the context clearly requires otherwise in
this Ordinance, the following terms shall have the meanings specified below:
"Business Day" means a day that is not a Saturday, Sunday, legal holiday or other day on
which banking institutions in the city where the Designated Payment/Transfer Office is located
are required or authorized by law or executive order to close.
"Certificate" means any of the Certificates.
"Certificate Date" means the date designated as the initial date of the Certificates by
Section 3.02(a) of this Ordinance.
"Certificates" means the certificates of obligation authorized to be issued by Section 3.01
of this Ordinance and designated as "Town of Trophy Club, Texas, Combination Tax and
Revenue Certificates of Obligation, Series 2013.
"Closing Date" means the date of the initial delivery of and payment for the Certificates.
"Code" means the Internal Revenue Code of 1986, as amended, including applicable
regulations, published rulings, and court decisions.
"Designated Payment/Transfer Office" means (i) with respect to the initial Paying
Agent/Registrar named herein, its office in Dallas, Texas, or at such other location designated by
the Paying Agent/Registrar and (ii) with respect to any successor Paying Agent/Registrar, the
office of such successor designated and located as may be agreed upon by the Town and such
successor.
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"DTC" means The Depository Trust Company of New York, New York, or any
successor securities depository.
"DTC Participant" means brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations on whose behalf DTC was created to hold securities
to facilitate the clearance and settlement of securities transactions among DTC Participants.
"EMMA" means the Electronic Municipal Market Access System.
"Event of Default" means any event of default as defined in Section 10.01 of this
Ordinance.
"Fiscal Year" means such fiscal year as shall from time to time be set by the Town
Council.
"Initial Certificate" means the initial certificate authorized by Section 3.04(d) of this
Ordinance.
"Interest and Sinking Fund" means the interest and sinking fund established by
Section 2.02 of this Ordinance.
"Interest Payment Date" means the date or dates upon which interest on the Certificates is
scheduled to be paid until their respective dates of maturity or prior redemption, such dates being
March 1 and September 1 of each year commencing March 1, 2014.
"MSRB" means the Municipal Securities Rulemaking Board.
"Net Revenues" means the gross revenues of the System less the expenses of operation
and maintenance as said expenses are defined by Chapter 1502, Texas Government Code, as
amended.
"Ordinance" means this Ordinance.
"Owner" means the person who is the registered owner of a Certificate or Certificates, as
shown in the Register.
"Paying Agent/Registrar" means initially The Bank of New York Mellon Trust
Company, National Association, Dallas, Texas, or any successor thereto as provided in this
Ordinance.
"Prior Lien Bonds" means any and all bonds or other obligations of the Town presently
outstanding or that may be hereafter issued, payable from and secured by a first lien on and
pledge of the Net Revenues or by a lien on and pledge of the Net Revenues subordinate to a first
lien and pledge of such Net Revenues but superior to the lien and pledge of the Surplus
Revenues made for the Certificates.
"Purchase Contract" means the purchase contract between the Town and the Underwriter
approved in Section 7.01(b).
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44344363.4
"Record Date" means the last Business Day of the month next preceding an Interest
Payment Date.
"Register" means the Register specified in Section 3.06(a) of this Ordinance.
"Representations Letter" means the Blanket Letter of Representations between the Town
and DTC.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
"SID" means any person designated by the State of Texas 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.
"Special Payment Date" means the Special Payment Date prescribed by Section 3.03(b).
"Special Record Date" means the Special Record Date prescribed by Section 3.03(b).
"Surplus Revenues" means the revenues of the System remaining after payment of all
operation and maintenance expenses thereof, and all debt service, reserve, and other
requirements in connection with the Town's Prior Lien Bonds; provided, however, that the
amount of such Surplus Revenues pledged to the payment of the Certificates shall be limited to
$1,000.
"System" as used in this Ordinance means the Town's municipal drainage utility system,
including all present and future additions, extensions, replacements, and improvements thereto.
"Town" means the Town of Trophy Club, Texas.
"Unclaimed Payments" means money deposited with the Paying Agent/Registrar for the
payment of principal of, redemption premium, if any, or interest on the Certificates as the same
come due and payable or money set aside for the payment of Certificates duly called for
redemption prior to maturity.
Section 1.02. Findings.
The declarations, determinations, and findings declared, made, and found in the preamble
to this Ordinance are hereby adopted, restated, and made a part of the operative provisions
hereof.
Section 1.03. Table of Contents, Titles, and Headings.
The table of contents, titles, and headings of the Articles and Sections of this Ordinance
have been inserted for convenience of reference only and are not to be considered a part hereof
and shall not in any way modify or restrict any of the terms or provisions hereof and shall never
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be considered or given any effect in construing this Ordinance or any provision hereof or in
ascertaining intent, if any question of intent should arise.
Section 1.04. Interpretation.
(a) Unless the context requires otherwise, words of the masculine gender shall be
construed to include correlative words of the feminine and neuter genders and vice versa, and
words of the singular number shall be construed to include correlative words of the plural
number and vice versa.
(b) This Ordinance and all the terms and provisions hereof shall be liberally
construed to effectuate the purposes set forth herein.
ARTICLE II
SECURITY FOR THE CERTIFICATES; INTEREST AND SINKING FUND
Section 2.01. Payment of the Certificates.
(a) Pursuant to the authority granted by the Texas Constitution and laws of the State
of Texas, there shall be levied and there is hereby levied for the current year and for each
succeeding year thereafter while any of the Certificates or any interest thereon is outstanding and
unpaid, an ad valorem tax on each one hundred dollars valuation of taxable property within the
Town, at a rate sufficient, within the limit prescribed by law, to pay the debt service
requirements of the Certificates, being (i) the interest on the Certificates, and (ii) a sinking fund
for their redemption at maturity or a sinking fund of two percent per annum (whichever amount
is the greater), when due and payable, full allowance being made for delinquencies and costs of
collection.
(b) The ad valorem tax thus levied shall be assessed and collected each year against
all property appearing on the tax rolls of the Town most recently approved in accordance with
law, and the money thus collected shall be deposited as collected to the Interest and Sinking
Fund.
(c) Said ad valorem tax, the collections therefrom, and all amounts on deposit in or
required hereby to be deposited to the Interest and Sinking Fund are hereby pledged and
committed irrevocably to the payment of the principal of and interest on the Certificates when
and as due and payable in accordance with their terms and this Ordinance.
(d) The amount of taxes to be provided annually for the payment of principal of and
interest on the Certificates shall be determined and accomplished in the following manner:
(i) The Town's annual budget shall reflect (i) the amount of debt service
requirements to become due on the Certificates in the next succeeding Fiscal Year of the
Town and (ii) the amount on deposit in the Interest and Sinking Fund, as of the date such
budget is prepared (after giving effect to any payments required to be made during the
remainder of the then current Fiscal Year), and (iii) the amount of Surplus Revenues
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estimated and budgeted to be available for the payment of such debt service requirements
on the Certificates during the next succeeding Fiscal Year.
(ii) The amount required to be provided in the succeeding Fiscal Year of the
Town from ad valorem taxes shall be the amount, if any, the debt service requirements to
be paid on the Certificates in the next succeeding Fiscal Year of the Town exceeds the
sum of (i) the amount shown to be on deposit in the Interest and Sinking Fund (after
giving effect to any payments required to be made during the remainder of the then
current Fiscal Year) at the time the annual budget is prepared, and (ii) the Surplus
Revenues shown to be budgeted and available for payment of said debt service
requirements.
(iii) Following the final approval of the annual budget of the Town, the
governing body of the Town shall, by ordinance, levy an ad valorem tax at a rate
sufficient to produce taxes in the amount determined in paragraph (ii) above, to be
utilized for purposes of paying the principal of and interest on the Certificates in the next
succeeding Fiscal Year of the Town.
(e) The Town hereby covenants and agrees that the Surplus Revenues are hereby
irrevocably pledged equally and ratably to the payment of the principal of, redemption premium,
if any, and interest on the Certificates, as the same become due.
(f) If the liens and provisions of this Ordinance shall be released in a manner
permitted by Article XI hereof, then the collection of such ad valorem tax may be suspended or
appropriately reduced, as the facts may permit, and further deposits to the Interest and Sinking
Fund may be suspended or appropriately reduced, as the facts may permit. In determining the
aggregate principal amount of outstanding Certificates, there shall be subtracted the amount of
any Certificates that have been duly called for redemption and for which money has been
deposited with the Paying Agent/Registrar for such redemption.
Section 2.02. Interest and Sinking Fund.
(a) The Town hereby establishes a special fund or account to be designated the
"Town of Trophy Club, Texas, Combination Tax and Revenue Certificates of Obligation, Series
2013, Interest and Sinking Fund" (the "Interest and Sinking Fund") said fund to be maintained at
an official depository bank of the Town separate and apart from all other funds and accounts of
the Town.
(b) Money on deposit in or required by this Ordinance to be deposited to the Interest
and Sinking Fund shall be used solely for the purpose of paying the interest on and principal of
the Certificates when and as due and payable in accordance with their terms and this Ordinance.
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ARTICLE III
AUTHORIZATION; GENERAL TERMS AND PROVISIONS
REGARDING THE CERTIFICATES
Section 3.01. Authorization.
The Town's certificates of obligation to be designated "Town of Trophy Club, Texas,
Combination Tax and Revenue Certificates of Obligation, Series 2013" (the "Certificates"), are
hereby authorized to be issued and delivered in accordance with the Constitution and laws of the
State of Texas, specifically Subchapter C, Chapter 271, Texas Local Government Code. The
Certificates shall be issued in the aggregate principal amount of $3,000,000 for the following
purposes, to wit: (i) (a) designing, developing, constructing, improving, extending, and
expanding streets, thoroughfares, sidewalks, bridges, and other public ways of the Town,
including streetscaping, streetlighting, right-of-way protection, utility relocation, and related
storm drainage improvements; and acquiring rights-of-way in connection therewith, (b)
designing, acquiring, improving, constructing, and renovating Town drainage and stormwater
infrastructure and facilities, ((a) and (b) together, the "Project") and (ii) to pay professional
services of attorneys, financial advisors and other professionals in connection with the Project
and the issuance of the Certificates.
Section 3.02. Date. Denomination. Maturities. and Interest.
(a) The Certificates shall be dated August 1, 2013. The Certificates shall be in fully
registered form, without coupons, in the denomination of $5,000 or any integral multiple thereof
and shall be numbered separately from one upward, except the Initial Certificate, which shall be
numbered T-1.
(b) The Certificates shall mature on March 1 in the years and in the principal amounts
set forth in the following schedule:
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Serial Certificates
Principal
Principal
Years
Amount
Interest Rate
Years
Amount
Interest Rate
2014
$140,000
2.500%
2020
$240,000
2.500%
2015
210,000
2.500
2021
245,000
2.500
2016
215,000
2.500
2022
255,000
2.750
2017
220,000
2.500
2023
265,000
2.750
2018
230,000
2.500
2024
270,000
3.000
2019
240,000
2.500
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Term Certificates
Year Principal Amount Interest Rate
2026 $220,000 3.000%
2028 250,000 3.250
(c) Interest shall accrue and be paid on each Certificate respectively until its maturity
or prior redemption from the later of the Certificate Date or the most recent interest payment date
to which interest has been paid or provided for at the rates per annum for each maturity specified
in the schedule contained in subsection (b) above. Such interest shall be payable semiannually
on March 1 and September 1 of each year commencing March 1, 2014, and shall be computed on
the basis of a 360 -day year of twelve 30 -day months.
Section 3.03. Medium Method, and Place of Pant.
(a) The principal of, redemption premium, if any, and interest on the Certificates
shall be paid in lawful money of the United States of America.
(b) Interest on the Certificates shall be payable to the Owners as shown in the
Register at the close of business on the Record Date; provided, however, in the event of
nonpayment of interest on a scheduled Interest Payment Date and for 30 days thereafter, a new
record date for such interest payment (a "Special Record Date") shall be established by the
Paying Agent/Registrar, if and when funds for the payment of such interest have been received
from the Town. Notice of the Special Record Date and of the scheduled payment date of the past
due interest (the "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 Owner of a Certificate appearing on the
Register at the close of business on the last Business Day next preceding the date of mailing of
such notice.
(c) Interest shall be paid by check, dated as of and mailed on the Interest Payment
Date, and sent by the Paying Agent/Registrar to each Owner, first class United States mail,
postage prepaid, to the address of each Owner as it appears in the Register, or by such other
customary banking arrangement acceptable to the Paying Agent/Registrar and the Owner;
provided, however, that the Owner shall bear all risk and expense of such alternative banking
arrangement. At the option of an Owner of at least $1,000,000 principal amount of the
Certificates, interest may be paid by wire transfer to the bank account of such Owner on file with
the Paying Agent/Registrar.
(d) The principal of each Certificate shall be paid to the Owner thereof on the due
date, whether at the maturity date or the date of prior redemption thereof upon presentation and
surrender of such Certificate at the Designated Payment/Transfer Office of the Paying
Agent/Registrar.
(e) If the date for the payment of the principal of or interest on the Certificates shall
be a Saturday, Sunday, legal holiday, or day on which banking institutions in the city where the
WE
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Designated Payment/Transfer Office of the paying Agent/Registrar is located are required or
authorized by law or executive order to close, then the date for such payment shall be the next
succeeding day which is not a Saturday, Sunday, legal holiday, or day on which banking
institutions are required or 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 and no additional interest shall
be due by reason of nonpayment on the date on which such payment is otherwise stated to be due
and payable.
(f) Unclaimed Payments shall be segregated in a special escrow account and held in
trust, uninvested by the Paying Agent/Registrar, for the account of the Owners of the Certificates
to which the Unclaimed Payments pertain. Subject to Title 6 of the Texas Property Code,
Unclaimed Payments remaining unclaimed by the Owners entitled thereto for three years after
the applicable payment or redemption date shall be applied to the next payment or payments on
the Certificates thereafter coming due and, to the extent any such money remains after the
retirement of all outstanding Certificates, shall be paid to the Town to be used for any lawful
purpose. Thereafter, neither the Town, the Paying Agent/Registrar, nor any other person shall be
liable or responsible to any Owners of such Certificates for any further payment of such
unclaimed moneys or on account of any such Certificates, subject to Title 6 of the Texas
Property Code.
Section 3.04. Execution and Registration of Certificates.
(a) The Certificates shall be executed on behalf of the Town by the Mayor and the
Town Secretary, by their manual or facsimile signatures, and the official seal of the Town shall
be impressed or placed in facsimile thereon. Such facsimile signatures on the Certificates shall
have the same effect as if each of the Certificates had been signed manually and in person by
each of said officers, and such facsimile seal on the Certificates shall have the same effect as if
the official seal of the Town had been manually impressed upon each of the Certificates.
(b) In the event that any officer of the Town whose manual or facsimile signature
appears on the Certificates ceases to be such officer before the authentication of such Certificates
or before the delivery thereof, such manual or facsimile signature nevertheless shall be valid and
sufficient for all purposes as if such officer had remained in such office.
(c) Except as provided below, no Certificate shall be valid or obligatory for any
purpose or be entitled to any security or benefit of this Ordinance unless and until there appears
thereon the Certificate of Paying Agent/Registrar substantially in the form provided herein, duly
authenticated by manual execution by an officer or duly authorized signatory of the Paying
Agent/Registrar. It shall not be required that the same officer or authorized signatory of the
Paying Agent/Registrar sign the Certificate of Paying Agent/Registrar on all of the Certificates.
In lieu of the executed Certificate of Paying Agent/Registrar described above, the Initial
Certificate delivered at the Closing Date shall have attached thereto the Comptroller's
Registration Certificate substantially in the form provided herein, manually executed by the
Comptroller of Public Accounts of the State of Texas, or by his duly authorized agent, which
Certificate shall be evidence that the Certificate has been duly approved by the Attorney General
of the State of Texas, that it is a valid and binding obligation of the Town, and that it has been
registered by the Comptroller of Public Accounts of the State of Texas.
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(d) On the Closing Date, one initial Certificate (the "Initial Certificate") representing
the entire principal amount of all Certificates, payable in stated installments to the initial
purchaser, or its designee, executed by the Mayor and Town Secretary of the Town, approved by
the Attorney General, and registered and manually signed by the Comptroller of Public
Accounts, will be delivered to the initial purchaser or its designee. Upon payment for the Initial
Certificate, the Paying Agent/Registrar shall cancel the Initial Certificate and deliver to DTC on
behalf of the initial purchaser one registered definitive Certificate for each year of maturity of the
Certificates in the aggregate principal amount of all Certificates for such maturity, registered in
the name of Cede & Co., as nominee of DTC.
Section 3.05. Ownership.
(a) The Town, the Paying Agent/Registrar, and any other person may treat the person
in whose name any Certificate is registered as the absolute owner of such Certificate for the
purpose of making and receiving payment as herein provided (except interest shall be paid to the
person in whose name such Certificate is registered on the Record Date or Special Record Date,
as applicable), and for all other purposes, whether or not such Certificate is overdue, and neither
the Town nor the Paying Agent/Registrar shall be bound by any notice or knowledge to the
contrary.
(b) All payments made to the Owner of a Certificate shall be valid and effectual and
shall discharge the liability of the Town and the Paying Agent/Registrar upon such Certificate to
the extent of the sums paid.
Section 3.06. Reizistration, Transfer, and Exchange.
(a) So long as any Certificates remain outstanding, the Town shall cause the Paying
Agent/Registrar to keep at the Designated Payment/Transfer Office a register (the "Register") in
which, subject to such reasonable regulations as it may prescribe, the Paying Agent/Registrar
shall provide for the registration and transfer of Certificates in accordance with this Ordinance.
(b) The ownership of a Certificate may be transferred only upon the presentation and
surrender of the Certificate at the Designated Payment/Transfer Office of the Paying
Agent/Registrar with such endorsement or other evidence of transfer as is acceptable to the
Paying Agent/Registrar. No transfer of any Certificate shall be effective until entered in the
Register.
(c) The Certificates shall be exchangeable upon the presentation and surrender
thereof at the Designated Payment/Transfer Office of the Paying Agent/Registrar for a
Certificate or Certificates of the same maturity and interest rate and in a denomination or
denominations of any integral multiple of $5,000, and in an aggregate principal amount equal to
the unpaid principal amount of the Certificates presented for exchange. The Paying
Agent/Registrar is hereby authorized to authenticate and deliver Certificates exchanged for other
Certificates in accordance with this Section.
(d) Each exchange Certificate delivered by the Paying Agent/Registrar in accordance
with this Section shall constitute an original contractual obligation of the Town and shall be
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entitled to the benefits and security of this Ordinance to the same extent as the Certificate or
Certificates in lieu of which such exchange Certificate is delivered.
(e) No service charge shall be made to the Owner for the initial registration,
subsequent transfer, or exchange for a different denomination of any of the Certificates. The
Paying Agent/Registrar, however, may require the Owner to pay a sum sufficient to cover any
tax or other governmental charge that is authorized to be imposed in connection with the
registration, transfer, or exchange of a Certificate.
(f) Neither the Town nor the Paying Agent/Registrar shall be required to issue,
transfer or exchange any Certificate called for redemption, in whole or in part, within 45
calendar days prior to the date fixed for redemption; provided, however, such limitation shall not
be applicable to an exchange by the Owner of the uncalled principal balance of a Certificate.
Section 3.07. Cancellation.
All Certificates paid or redeemed before scheduled maturity in accordance with this
Ordinance, and all Certificates in lieu of which exchange Certificates or replacement Certificates
are authenticated and delivered in accordance with this Ordinance, shall be canceled and proper
records made regarding such payment, redemption, exchange, or replacement. The Paying
Agent/Registrar shall then return such canceled Certificates to the Town or may in accordance
with law dispose of such cancelled Certificates.
Section 3.08. Temporary Certificates.
(a) Following the delivery and registration of the Initial Certificate and pending the
preparation of definitive Certificates, the proper officers of the Town may execute and, upon the
Town's request, the Paying Agent/Registrar shall authenticate and deliver, one or more
temporary Certificates that are printed, lithographed, typewritten, mimeographed, or otherwise
produced, in any denomination, substantially of the tenor of the definitive Certificates in lieu of
which they are delivered, without coupons, and with such appropriate insertions, omissions,
substitutions, and other variations as the officers of the Town executing such temporary
Certificates may determine, as evidenced by their signing of such temporary Certificates.
(b) Until exchanged for Certificates in definitive form, such Certificates in temporary
form shall be entitled to the benefit and security of this Ordinance.
(c) The Town, without unreasonable delay, shall prepare, execute and deliver to the
Paying Agent/Registrar the Certificates in definitive form; thereupon, upon the presentation and
surrender of the Certificate or Certificates in temporary form to the Paying Agent/Registrar, the
Paying Agent/Registrar shall cancel the Certificates in temporary form and shall authenticate and
deliver in exchange therefor a Certificate or Certificates of the same maturity and series, in
definitive form, in the authorized denomination, and in the same aggregate principal amount, as
the Certificate or Certificates in temporary form surrendered. Such exchange shall be made
without the making of any charge therefor to any Owner.
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Section 3.09. Replacement Certificates.
(a) Upon the presentation and surrender to the Paying Agent/Registrar of a mutilated
Certificate, the Paying Agent/Registrar shall authenticate and deliver in exchange therefor a
replacement Certificate of like tenor and principal amount, bearing a number not
contemporaneously outstanding. The Town or the Paying Agent/Registrar may require the
Owner of such Certificate to pay a sum sufficient to cover any tax or other governmental charge
that is authorized to be imposed in connection therewith and any other expenses connected
therewith.
(b) In the event that any Certificate is lost, apparently destroyed or wrongfully taken,
the Paying Agent/ Registrar, pursuant to the applicable laws of the State of Texas and in the
absence of notice or knowledge that such Certificate has been acquired by a bona fide purchaser,
shall authenticate and deliver a replacement Certificate of like tenor and principal amount,
bearing a number not contemporaneously outstanding, provided that the Owner first complies
with the following requirements:
(i) furnishes to the Paying Agent/Registrar satisfactory evidence of his or her
ownership of and the circumstances of the loss, destruction, or theft of such Certificate;
(ii) furnishes such security or indemnity as may be required by the Paying
Agent/Registrar to save it and the Town harmless;
(iii) pays all expenses and charges in connection therewith, including, but not
limited to, printing costs, legal fees, fees of the Paying Agent/Registrar, and any tax or
other governmental charge that is authorized to be imposed; and
(iv) satisfies any other reasonable requirements imposed by the Town and the
Paying Agent/Registrar.
(c) If, after the delivery of such replacement Certificate, a bona fide purchaser of the
original Certificate in lieu of which such replacement Certificate was issued presents for
payment such original Certificate, the Town and the Paying Agent/Registrar shall be entitled to
recover such replacement Certificate from the person to whom it was delivered or any person
taking therefrom, except a bona fide purchaser, and shall be entitled to recover upon the security
or indemnity provided therefor to the extent of any loss, damage, cost, or expense incurred by the
Town or the Paying Agent/Registrar in connection therewith.
(d) In the event that any such mutilated, lost, apparently destroyed, or wrongfully
taken Certificate has become or is about to become due and payable, the Paying Agent/Registrar,
in its discretion, instead of issuing a replacement Certificate, may pay such Certificate when it
becomes due and payable.
(e) Each replacement Certificate delivered in accordance with this Section shall
constitute an original additional contractual obligation of the Town and shall be entitled to the
benefits and security of this Ordinance to the same extent as the Certificate or Certificates in lieu
of which such replacement Certificate is delivered.
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#4344363.4
Section 3.10. Book -Entry -Only System.
(a) Notwithstanding any other provision hereof, upon initial issuance of the
Certificates, the Certificates shall be registered in the name of Cede & Co., as nominee of DTC.
The definitive Certificates shall be initially issued in the form of a single separate certificate for
each of the maturities thereof.
(b) With respect to Certificates registered in the name of Cede & Co., as nominee of
DTC, the Town and the Paying Agent/Registrar shall have no responsibility or obligation to any
DTC Participant or to any person on behalf of whom such a DTC Participant holds an interest in
the Certificates. Without limiting the immediately preceding sentence, the Town and the Paying
Agent/Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the
records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in
the Certificates, (ii) the delivery to any DTC Participant or any other person, other than an
Owner, as shown on the Register, of any notice with respect to the Certificates, including any
notice of redemption, or (iii) the payment to any DTC Participant or any other person, other than
an Owner, as shown in the Register of any amount with respect to principal of, premium, if any,
or interest on the Certificates. Notwithstanding any other provision of this Ordinance to the
contrary, the Town and the Paying Agent/Registrar shall be entitled to treat and consider the
person in whose name each Certificate is registered in the Register as the absolute owner of such
Certificate for the purpose of payment of principal of, premium, if any, and interest on
Certificates, for the purpose of giving notices of redemption and other matters with respect to
such Certificate, for the purpose of registering transfer with respect to such Certificate, and for
all other purposes whatsoever. The Paying Agent/Registrar shall pay all principal of, premium,
if any, and interest on the Certificates only to or upon the order of the respective Owners as
shown in the Register, as provided in this Ordinance, or their respective attorneys duly
authorized in writing, and all such payments shall be valid and effective to fully satisfy and
discharge the Town's obligations with respect to payment of, premium, if any, and interest on the
Certificates to the extent of the sum or sums so paid. No person other than an Owner, as shown
in the Register, shall receive a certificate evidencing the obligation of the Town to make
payments of amounts due pursuant to this Ordinance. Upon delivery by DTC to the Paying
Agent/Registrar of written notice to the effect that DTC has determined to substitute a new
nominee in place of Cede & Co., the word "Cede & Co." in this Ordinance shall refer to such
new nominee of DTC.
(c) The Representations Letter previously executed and delivered by the Town, and
applicable to the Town's obligations delivered in book -entry -only form to DTC as securities
depository, is hereby ratified and approved for the Certificates.
Section 3.11. Successor Securities Depository,• Transfer Outside Book -Entry -Only
System.
In the event that the Town or the Paying Agent/Registrar determines that DTC is
incapable of discharging its responsibilities described herein and in the Representations Letter of
the Town to DTC, and that it is in the best interest of the Town and the beneficial owners of the
Certificates that they be able to obtain certificated Certificates, or in the event DTC discontinues
the services described herein, the Town shall (i) appoint a successor securities depository,
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#4344363.4
qualified to act as such under Section 17(a) of the Securities and Exchange Act of 1934, as
amended, notify DTC and DTC Participants of the appointment of such successor securities
depository and transfer one or more separate Certificates to such successor securities depository;
or (ii) notify DTC and DTC Participants of the availability through DTC of certificated
Certificates and cause the Paying Agent/Registrar to transfer one or more separate registered
Certificates to DTC Participants having Certificates credited to their DTC accounts. In such
event, the Certificates shall no longer be restricted to being registered in the Register in the name
of Cede & Co., as nominee of DTC, but may be registered in the name of the successor securities
depository, or its nominee, or in whatever name or names Owners transferring or exchanging
Certificates shall designate, in accordance with the provisions of this Ordinance.
Section 3.12. Payments to Cede & Co.
Notwithstanding any other provision of this Ordinance to the contrary, so long as the
Certificates are registered in the name of Cede & Co., as nominee of DTC, all payments with
respect to principal of, premium, if any, and interest on such Certificates, and all notices with
respect to such Certificates shall be made and given, respectively, in the manner provided in the
Representations Letter of the Town to DTC.
ARTICLE IV
REDEMPTION OF CERTIFICATES BEFORE MATURITY
Section 4.01. Limitation on Redemption.
The Certificates shall be subject to redemption before scheduled maturity only as
provided in this Article IV.
Section 4.02. Optional Redemption.
(a) The Town reserves the option to redeem Certificates maturing on and after
March 1, 2023 in whole or any part, before their respective scheduled maturity dates, on
March 1, 2022 or on any date thereafter, such redemption date or dates to be fixed by the Town,
at a price equal to the principal amount of the Certificates called for redemption plus accrued
interest to the date fixed for redemption.
(b) If less than all of the Certificates are to be redeemed pursuant to an optional
redemption, the Town shall determine the maturity or maturities and the amounts thereof to be
redeemed and shall direct the Paying Agent/Registrar to call by lot the Certificates, or portions
thereof, within such maturity or maturities and in such principal amounts for redemption.
(c) The Town, at least 45 days before the redemption date, unless a shorter period
shall be satisfactory to the Paying Agent/Registrar, shall notify the Paying Agent/Registrar of
such redemption date and of the principal amount of Certificates to be redeemed.
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Section 4.03. Mandatory Sinking Fund Redemption.
(a) The Certificates maturing on March 1, 2026 and March 1, 2028 (the "Term
Certificates," ) are subject to scheduled mandatory redemption and will be redeemed by the
Town, in part at a price equal to the principal amount thereof, without premium, plus accrued
interest to the redemption date, out of moneys available for such purpose in the Interest and
Sinking Fund, on the dates and in the respective principal amounts as set forth below.
Term Certificates Maturing March 1, 2026
Redemption Date Redemption Amount
March 1, 2025 $100,000
March 1, 2026* 120,000
*maturity
Term Certificates Maturing March 1, 2028
Redemption Date Redemption Amount
March 1, 2027 $125,000
March 1, 2028* 125,000
*maturity
(b) At least forty-five (45) days prior to each scheduled mandatory redemption date,
the Paying Agent/Registrar shall select for redemption by lot, or by any other customary method
that results in a random selection, a principal amount of Term Certificates equal to the aggregate
principal amount of such Term Certificates to be redeemed, shall call such Term Certificates for
redemption on such scheduled mandatory redemption date, and shall give notice of such
redemption, as provided in Section 4.05.
(c) The principal amount of the Term Certificates required to be redeemed on any
redemption date pursuant to subparagraph (a) of this Section 4.03 shall be reduced, at the option
of the Town, by the principal amount of any Term Certificates which, at least 45 days prior to the
mandatory sinking fund redemption date (i) shall have been acquired by the Town at a price not
exceeding the principal amount of such Term Certificates plus accrued interest to the date of
purchase thereof, and delivered to the Paying Agent/Registrar for cancellation, or (ii) shall have
been redeemed pursuant to the optional redemption provisions hereof and not previously credited
to a mandatory sinking fund redemption.
Section 4.04. Partial Redemption.
(a) A portion of a single Certificate of a denomination greater than $5,000 may be
redeemed, but only in a principal amount equal to $5,000 or any integral multiple thereof. If
such a Certificate is to be partially redeemed, the Paying Agent/Registrar shall treat each $5,000
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portion of the Certificate as though it were a single Certificate for purposes of selection for
redemption.
(b) Upon surrender of any Certificate for redemption in part, the Paying
Agent/Registrar, in accordance with Section 3.06 of this Ordinance, shall authenticate and
deliver an exchange Certificate or Certificates in an aggregate principal amount equal to the
unredeemed portion of the Certificate so surrendered, such exchange being without charge.
(c) The Paying Agent/Registrar shall promptly notify the Town in writing of the
principal amount to be redeemed of any Certificate as to which only a portion thereof is to be
redeemed.
Section 4.05. Notice of Redemption to Owners.
(a) The Paying Agent/Registrar shall give notice of any redemption of Certificates by
sending notice by first class United States mail, postage prepaid, not less than 30 days before the
date fixed for redemption, to the Owner of each Certificate (or part thereof) to be redeemed, at
the address shown on the Register at the close of business on the Business Day next preceding
the date of mailing such notice.
(b) The notice shall state the redemption date, the redemption price, the place at
which the Certificates are to be surrendered for payment, and, if less than all the Certificates
outstanding are to be redeemed, an identification of the Certificates or portions thereof to be
redeemed.
(c) Any notice given as provided in this Section shall be conclusively presumed to
have been duly given, whether or not the Owner receives such notice.
Section 4.06. Payment Upon Redemption.
(a) Before or on each redemption date, the Town shall deposit with the Paying
Agent/Registrar money sufficient to pay all amounts due on the redemption date and the Paying
Agent/Registrar shall make provision for the payment of the Certificates to be redeemed on such
date by setting aside and holding in trust such amounts as are received by the Paying
Agent/Registrar from the Town and shall use such funds solely for the purpose of paying the
principal of, redemption premium, if any, and accrued interest on the Certificates being
redeemed.
(b) Upon presentation and surrender of any Certificate called for redemption at the
Designated Payment/Transfer Office of the Paying Agent/Registrar on or after the date fixed for
redemption, the Paying Agent/Registrar shall pay the principal of, redemption premium, if any,
and accrued interest on such Certificate to the date of redemption from the money set aside for
such purpose.
Section 4.07. Effect of Redemption.
(a) Notice of redemption having been given as provided in Section 4.05 of this
Ordinance, the Certificates or portions thereof called for redemption shall become due and
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payable on the date fixed for redemption and, unless the Town defaults in its obligation to make
provision for the payment of the principal thereof, redemption premium, if any, or accrued
interest thereon, such Certificates or portions thereof shall cease to bear interest from and after
the date fixed for redemption, whether or not such Certificates are presented and surrendered for
payment on such date.
(b) If the Town shall fail to make provision for payment of all sums due on a
redemption date, then any Certificate or portion thereof called for redemption shall continue to
bear interest at the rate stated on the Certificate until due provision is made for the payment of
same by the Town.
Section 4.08. Conditional Notice of Redemption.
The Town reserves the right to give notice of its election or direction to redeem Bonds
conditioned upon the occurrence of subsequent events. Such notice may state (i) that the
redemption is conditioned upon the deposit of moneys and/or authorized securities, in an amount
equal to the amount necessary to effect the redemption, with the Paying Agent/Registrar, or such
other entity as may be authorized by law, no later than the redemption date, or (ii) that the Town
retains the right to rescind such notice at any time on or prior to the scheduled redemption date if
the Town delivers a certificate of the Town to the Paying Agent/Registrar instructing the Paying
Agent/Registrar to rescind the redemption notice and such notice and redemption shall be of no
effect if such moneys and/or authorized securities are not so deposited or if the notice is
rescinded. The Paying Agent/Registrar shall give prompt notice of any such rescission of a
conditional notice of redemption to the affected Owners. Any Bonds subject to conditional
redemption and such redemption has been rescinded shall remain Outstanding and the rescission
of such redemption shall not constitute an event of default. Further, in the case of a conditional
notice of redemption, the failure of the Town to make moneys and or authorized securities
available in part or in whole on or before the redemption date shall not constitute an event of
default.
Section 4.09. Lapse of Pa moment.
Money set aside for the redemption of Certificates and remaining unclaimed by the
Owners of such Certificates shall be subject to the provisions of Section 3.03(f) hereof.
ARTICLE V
PAYING AGENT/REGISTRAR
Section 5.01. Appointment of Initial Paying _Agent/Registrar.
The Bank of New York Mellon Trust Company, National Association, Dallas, Texas, is
hereby appointed as the initial Paying Agent/Registrar for the Certificates.
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Section 5.02. Qualifications.
Each Paying Agent/Registrar shall be a commercial bank, a trust company organized
under the laws of the State of Texas, or other entity duly qualified and legally authorized to serve
as and perform the duties and services of paying agent and registrar for the Certificates.
Section 5.03. Maintaining Paying A eg nt/Re isg tray.
(a) At all times while any of the Certificates are outstanding, the Town will maintain
a Paying Agent/Registrar that is qualified under Section 5.02 of this Ordinance. The Mayor is
hereby authorized and directed to execute an agreement with the Paying Agent/Registrar
specifying the duties and responsibilities of the Town and the Paying Agent/Registrar in
substantially the form presented at this meeting, such form of agreement being hereby approved.
The signature of the Mayor shall be attested by the Town Secretary of the Town.
(b) If the Paying Agent/Registrar resigns or otherwise ceases to serve as such, the
Town will promptly appoint a replacement.
Section 5.04. Termination.
The Town, upon not less than sixty (60) days' notice, reserves the right to terminate the
appointment of any Paying Agent/Registrar by delivering to the entity whose appointment is to
be terminated written notice of such termination.
Section 5.05. Notice of Change to Owners.
Promptly upon each change in the entity serving as Paying Agent/Registrar, the Town
will cause notice of the change to be sent to each Owner by first class United States mail,
postage prepaid, at the address thereof in the Register, stating the effective date of the change
and the name and mailing address of the replacement Paying Agent/Registrar.
Section 5.06. Agreement to Perform Duties and Functions.
By accepting the appointment as Paying Agent/Registrar and executing the Paying
Agent/Registrar Agreement, the Paying Agent/Registrar is deemed to have agreed to the
provisions of this Ordinance and that it will perform the duties and functions of Paying
Agent/Registrar prescribed thereby.
Section 5.07. Delivery of Records to Successor.
If a Paying Agent/Registrar is replaced, such Paying Agent/Registrar, promptly upon the
appointment of the successor, will deliver the Register (or a copy thereof) and all other pertinent
books and records relating to the Certificates to the successor Paying Agent/Registrar.
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ARTICLE VI
FORM OF THE CERTIFICATES
Section 6.01. Form Generally.
(a) The Certificates, including the Registration Certificate of the Comptroller of
Public Accounts of the State of Texas, the Certificate of the Paying Agent/Registrar, and the
Assignment form to appear on each of the Certificates, (i) shall be substantially in the form set
forth in this Article, with such appropriate insertions, omissions, substitutions, and other
variations as are permitted or required by this Ordinance, and (ii) may have such letters,
numbers, or other marks of identification (including identifying numbers and letters of the
Committee on Uniform Securities Identification Procedures of the American Bankers
Association) and such legends and endorsements (including any reproduction of an opinion of
counsel) thereon as, consistently herewith, may be determined by the Town or by the officers
executing such Certificates, as evidenced by their execution thereof.
(b) Any portion of the text of any Certificates may be set forth on the reverse side
thereof, with an appropriate reference thereto on the face of the Certificates.
(c) The definitive Certificates, if any, shall be typewritten, photocopied, printed,
lithographed, or engraved, and may be produced by any combination of these methods or
produced in any other similar manner, all as determined by the officers executing such
Certificates, as evidenced by their execution thereof.
(d) The Initial Certificate submitted to the Attorney General of the State of Texas
may be typewritten and photocopied or otherwise reproduced.
Section 6.02. Form of the Certificates.
The form of the Certificates, including the form of the Registration Certificate of the
Comptroller of Public Accounts of the State of Texas, the form of Certificate of the Paying
Agent/Registrar and the form of Assignment appearing on the Certificates, shall be substantially
as follows:
(a) Form of Certificate.
REGISTERED REGISTERED
No. $
United States of America
State of Texas
Counties of Tarrant and Denton
TOWN OF TROPHY CLUB, TEXAS
COMBINATION TAX AND REVENUE
CERTIFICATE OF OBLIGATION
SERIES 2013
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#4344363.4
INTEREST RATE:
MATURITY DATE:
March 1,
DATED DATE:
August 1, 2013
CUSIP NUMBER:
The Town of Trophy Club (the "Town"), in the Counties of Tarrant and Denton, State of
Texas, for value received, hereby promises to pay to
or registered assigns, on the Maturity Date specified above, the sum of
DOLLARS
unless this Certificate shall have been sooner called for redemption and the payment of the
principal hereof shall have been provided for, and to pay interest on such principal amount from
the later of Dated Date specified above or the most recent interest payment date to which interest
has been paid or provided for until payment of such principal amount has been provided for, at
the per annum rate of interest specified above, computed on the basis of a 360 -day year of twelve
30 -day months, such interest to be paid semiannually on March 1 and September 1 of each year,
commencing March 1, 2014.
The principal of this Certificate shall be payable without exchange or collection charges
in lawful money of the United States of America upon presentation and surrender of this
Certificate at the designated office in Dallas, Texas, of The Bank of New York Mellon Trust
Company, National Association, as Paying Agent/Registrar (the "Designated Payment/Transfer
Office"), or, with respect to a successor paying agent/registrar, at the Designated
Payment/Transfer Office of such successor Paying Agent/Registrar. Interest on this Certificate is
payable by check dated as of the interest payment date, and will be mailed by the Paying
Agent/Registrar to the registered owner at the address shown on the registration books kept by
the Paying Agent/Registrar or by such other customary banking arrangement acceptable to the
Paying Agent/Registrar and the registered owner; provided, however, such registered owner shall
bear all risk and expenses of such customary banking arrangement. At the option of an Owner of
at least $1,000,000 principal amount of the Certificates, interest may be paid by wire transfer to
the bank account of such Owner on file with the Paying Agent/Registrar. For the purpose of the
payment of interest on this Certificate, the registered owner shall be the person in whose name
this Certificate is registered at the close of business on the "Record Date," which shall be the
fifteenth business day of the month next preceding such interest payment date; provided,
however, that in the event of nonpayment of interest on a scheduled payment date and for 30
days thereafter, a new record date for such interest payment (a "Special Record Date") shall be
established by the Paying Agent/Registrar, if and when funds for the payment of such interest
have been received from the Town. Notice of the Special Record Date and of the scheduled
payment date of the past due interest (the "Special Payment Date," which date 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 Owner of a
Certificate appearing on the 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.
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If the date for the payment of the principal of or interest on this Certificate shall be a
Saturday, Sunday, legal holiday, or day on which banking institutions in the city where the
Designated Payment/Transfer Office of the Paying Agent/Registrar is located are required or
authorized by law or executive order to close, the date for such payment shall be the next
succeeding day that is not a Saturday, Sunday, legal holiday, or day on which banking
institutions are required or 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 and no additional interest shall
be due by reason of nonpayment on the date on which such payment is otherwise stated to be due
and payable.
This Certificate is one of a series of fully registered certificates specified in the title
hereof issued in the aggregate principal amount of $3,000,000 (herein referred to as the
"Certificates"), issued pursuant to a certain ordinance of the Town (the "Ordinance") for the
purpose of paying contractual obligations to be incurred for authorized public improvements (the
"Project") as described in the Ordinance, and to pay the contractual obligations for professional
services of attorneys, financial advisors and other professionals in connection with the Project
and the issuance of the Certificates.
The Certificates and the interest thereon are payable from the levy of a direct and
continuing ad valorem tax within the limits prescribed by law, against all taxable property in the
Town and from a pledge of certain Surplus Revenues (not to exceed $1,000) of the Town's
municipal drainage utility system, all as described and provided for in the Ordinance.
The Town has reserved the option to redeem the Certificates maturing on or after
March 1, 2023, in whole or in part, before their respective scheduled maturity dates, on March 1,
2022, or on any date thereafter, at a price equal to the principal amount of the Certificates so
called for redemption plus accrued interest to the date fixed for redemption. If less than all of the
Certificates are to be redeemed, the Town shall determine the maturity or maturities and the
amounts thereof to be redeemed and shall direct the Paying Agent/Registrar to call by lot or other
customary method that results in a random selection the Certificates, or portions thereof, within
such maturity and in such principal amounts, for redemption.
The Certificates maturing March 1, 2026 and March 1, 2028 (the "Term Certificates") are
subject to scheduled mandatory redemption and will be redeemed by the Town, in part at a price
equal to the principal amount thereof, without premium, plus accrued interest to the redemption
date, out of moneys available for such purpose in the Interest and Sinking Fund, on the dates and
in the respective principal amounts as set forth below.
Term Certificates Maturing March 1, 2026
Redemption Date Redemption Amount
March 1, 2025 $100,000
March 1, 2026* 120,000
*maturity
#4344363.4
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Term Certificates Maturing March 1, 2028
Redemption Date Redemption Amount
March 1, 2027 $125,000
March 1, 2028* 125,000
*maturity
At least forty-five (45) days prior to each scheduled mandatory redemption date, the
Paying Agent/Registrar shall select for redemption by lot, or by any other customary method that
results in a random selection, a principal amount of Term Certificates equal to the aggregate
principal amount of such Term Certificates to be redeemed, shall call such Term Certificates for
redemption on such scheduled mandatory redemption date, and shall give notice of such
redemption, as provided in the Ordinance.
In lieu of calling the Term Certificates described above, for mandatory redemption, the
Town reserves the right to purchase such Term Certificates at a price not exceeding the principal
amount thereof, plus accrued interest, with (a) moneys on deposit in the Interest and Sinking
Fund which are available for the mandatory redemption of such Term Certificates or (b) other
lawfully available funds.
Upon any such purchase in lieu of redemption, not less than five (5) days prior to a
mandatory redemption date, the Town shall deliver such Term Certificates to the Paying
Agent/Registrar prior to the selection of the Term Certificates for redemption and the principal
amount so delivered shall be credited against the amount required to be called for redemption in
that year.
Notice of such redemption or redemptions shall be given by first class mail, postage
prepaid, not less than 30 days before the date fixed for redemption, to the registered owner of
each of the Certificates to be redeemed in whole or in part. Notice having been so given, the
Certificates or portions thereof designated for redemption shall become due and payable on the
redemption date specified in such notice; from and after such date, notwithstanding that any of
the Certificates or portions thereof so called for redemption shall not have been surrendered for
payment, interest on such Certificates or portions thereof shall cease to accrue.
The Town reserves the right to give notice of its election or direction to redeem
Certificates conditioned upon the occurrence of subsequent events. Such notice may state (i) that
the redemption is conditioned upon the deposit of moneys and/or authorized securities, in an
amount equal to the amount necessary to effect the redemption, with the Paying Agent/Registrar,
or such other entity as may be authorized by law, no later than the redemption date, or (ii) that
the Town retains the right to rescind such notice at any time on or prior to the scheduled
redemption date if the Town delivers a certificate of the Town to the Paying Agent/Registrar
instructing the Paying Agent/Registrar to rescind the redemption notice and such notice and
redemption shall be of no effect if such moneys and/or authorized securities are not so deposited
or if the notice is rescinded. The Paying Agent/Registrar shall give prompt notice of any such
rescission of a conditional notice of redemption to the affected Owners. Any Certificates subject
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to conditional notice of redemption and such redemption has been rescinded shall remain
Outstanding and the rescission of such redemption shall not constitute an event of default.
Further, in the case of a conditional redemption, the failure of the Town to make moneys and or
authorized securities available in part or in whole on or before the redemption date shall not
constitute an event of default.
As provided in the Ordinance, and subject to certain limitations therein set forth, this
Certificate is transferable upon surrender of this Town for transfer at the Designated
Payment/Transfer Office of the Paying Agent/Registrar with such endorsement or other evidence
of transfer as is acceptable to the Paying Agent/Registrar; thereupon, one or more new fully
registered Certificates of the same stated maturity, of authorized denominations, bearing the
same rate of interest, and for the same aggregate principal amount will be issued to the
designated transferee or transferees.
Neither the Town nor the Paying Agent/Registrar shall be required to issue, transfer or
exchange any Certificate called for redemption where such redemption is scheduled to occur
within 45 calendar days of the date fixed for redemption; provided, however, such limitation
shall not be applicable to an exchange by the registered owner of the uncalled principal balance
of a Certificate.
The Town, the Paying Agent/Registrar, and any other person may treat the person in
whose name this Certificate is registered as the owner hereof for the purpose of receiving
payment as herein provided (except interest shall be paid to the person in whose name this
Certificate is registered on the Record Date, or the Special Record Date, as applicable) and for all
other purposes, whether or not this Certificate be overdue, and neither the Town nor the Paying
Agent/Registrar shall be affected by notice to the contrary.
IT IS HEREBY CERTIFIED AND RECITED that the issuance of this Certificate and the
series of which it is a part is duly authorized by law; that all acts, conditions, and things to be
done precedent to and in the issuance of the Certificates have been properly done and performed
and have happened in regular and due time, form, and manner as required by law; that ad
valorem taxes upon all taxable property in the Town have been levied for and pledged to the
payment of the debt service requirements of the Certificates within the limit prescribed by law;
that, in addition to said taxes, further provisions have been made for the payment of the debt
service requirements of the Certificates from a pledge of a limited amount of the Surplus
Revenues, as described in the Ordinance, derived by the Town from the operation of the
municipal drainage utility system in an amount limited to $1,000, that when so collected, such
taxes and Surplus Revenues shall be appropriated to such purposes; and that the total
indebtedness of the Town, including the Certificates, does not exceed any constitutional or
statutory limitation.
IN WITNESS WHEREOF, the Town has caused this Certificate to be executed by the
manual or facsimile signature of the Mayor of the Town and countersigned by the manual or
facsimile signature of the Town Secretary, and the official seal of the Town has been duly
impressed or placed in facsimile on this Certificate.
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Mayor, Town of Trophy Club, Texas
Town Secretary,
Town of Trophy Club, Texas
[SEAL]
(b) Form of Comptroller's Registration Certificate. The following Comptroller's
Registration Certificate may be deleted from the definitive Certificates if such certificate on the
Initial Certificate is fully executed.
OFFICE OF THE COMPTROLLER §
OF PUBLIC ACCOUNTS § REGISTER NO.
OF THE STATE OF TEXAS §
I hereby certify that there is on file and of record in my office a certificate of the Attorney
General of the State of Texas to the effect that this Certificate has been examined by him as
required by law, that he finds that it has been issued in conformity with the Constitution and laws
of the State of Texas, and that it is a valid and binding obligation of the Town of Trophy Club,
Texas; and that this Certificate has this day been registered by me.
Witness my hand and seal of office at Austin, Texas,
Comptroller of Public Accounts
of the State of Texas
(c) Form of Certificate of Pang Agent/Registrar. _ The following Certificate of
Paying Agent/Registrar may be deleted from each Initial Certificate if the Comptroller's
Registration Certificate appears thereon.
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CERTIFICATE OF PAYING AGENT/REGISTRAR
The records of the Paying Agent/Registrar show that the Initial Certificates of this series
of Certificates was approved by the Attorney General of the State of Texas and registered by the
Comptroller of Public Accounts of the State of Texas, and that this is one of the Certificates
referred to in the within -mentioned Ordinance.
Dated:
(d) Form of Assignment.
THE BANK OF NEW YORK MELLON
TRUST COMPANY,
NATIONAL ASSOCIATION,
as Paying Agent/Registrar
ASSIGNMENT
Authorized Signatory
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto (print or
typewrite name, address and Zip Code of transferee):
(Social Security or other identifying number: ) the within Certificate
and all rights hereunder and hereby irrevocably constitutes and appoints
attorney to transfer the within Certificate on the books kept for
registration hereof, with full power of substitution in the premises.
Dated:
Signature Guaranteed By:
Authorized Signatory
NOTICE: The Signature on this Assignment
must correspond with the name of the
registered owner as it appears on the face of
the within Certificate in every particular and
must be guaranteed in a manner acceptable to
the Paying Agent/Registrar.
(e) The initial Certificate shall be in the form set forth in subsections (a) through (d)
of this Section, except for the following alterations:
(i) immediately under the name of the Certificate, the headings "INTEREST
RATE," and "MATURITY DATE" shall both be completed with the words "As Shown
Below" and the words "CUSIP NO." shall be deleted;
(ii) in the first paragraph of the Certificate, the words "on the Maturity Date
specified above, the sum of DOLLARS" shall be deleted and
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the following will be inserted: "on the first day of March in the years, in the principal
installments and bearing interest at the per annum rates set forth in the following
schedule:
Year Principal Amount Interest Rate
(Information to be inserted from Section 3.02(c) hereof).
(iii) the Initial Certificate shall be numbered T-1.
Section 6.03. CUSIP Registration.
The Town may secure identification numbers through the CUSIP Global Services,
managed by Standard & Poor's Financial Services LLC on behalf of the American Bankers
Association, and may authorize the printing of such numbers on the face of the Certificates. It is
expressly provided, however, that the presence or absence of CUSIP numbers on the Certificates
shall be of no significance or effect in regard to the legality thereof and neither the Town nor the
attorneys approving said Certificates as to legality are to be held responsible for CUSIP numbers
incorrectly printed on the Certificates.
Section 6.04. Legal Opinion.
The approving legal opinion of Bracewell & Giuliani LLP, Bond Counsel, may be
attached to or printed on the reverse side of each Certificate over the certification of the Town
Secretary of the Town, which may be executed in facsimile.
Section 6.05. Statement Insurance.
A statement relating to a municipal bond insurance policy, if any, to be issued for the
Certificates, may be printed on each Certificate.
ARTICLE VII
SALE AND DELIVERY OF CERTIFICATES;
DEPOSIT OF PROCEEDS; FLOW OF FUNDS
Section 7.01. Sale of Certificates: Official Statement.
(a) The Certificates, having been duly advertised and offered for sale at competitive
bid, are hereby officially sold and awarded to Raymond James & Associates, Inc. (the
"Purchaser") for a purchase price equal to the principal amount thereof plus a cash premium of
$64,065.70, being the bid which produced the lowest true interest cost to the Town. The Initial
Certificate shall be registered in the name of the Purchaser or its designee.
(b) The form and substance of the Preliminary Official Statement and any addenda,
supplement or amendment thereto, are hereby in all respects approved and adopted and is hereby
deemed final as of its date within the meaning and for the purposes of paragraph (b)(1) of Rule
15c2-12 under the Securities Exchange Act of 1934, as amended. The Mayor and Town
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Secretary are hereby authorized and directed to cause to be prepared a final Official Statement
(the "Official Statement") incorporating applicable pricing information. pertaining to the
Certificates, and to execute the same by manual or facsimile signature and deliver appropriate
numbers of executed copies thereof to the Purchaser. The Official Statement as thus approved,
executed and delivered, with such appropriate variations as shall be approved by the Mayor and
the Purchaser, may be used by the Purchaser in the public offering and sale thereof. The Town
Secretary is hereby authorized and directed to include and maintain a copy of the Official
Statement and any addenda, supplement or amendment thereto thus approved among the
permanent records of this meeting. The use and distribution of the Preliminary Official
Statement, and the preliminary public offering of the Certificates by the Purchaser, is hereby
ratified, approved and confirmed.
(c) All officers of the Town are authorized to execute such documents, certificates
and receipts as they may deem appropriate in order to consummate the delivery of the
Certificates in accordance with the terms of sale therefor including, without limitation, the
Purchase Contract. Further, in connection with the submission of the record of proceedings for
the Certificates to the Attorney General of the State of Texas for examination and approval of
such Certificates, the appropriate officer of the Town is hereby authorized and directed to issue a
check of the Town payable to the Attorney General of the State of Texas as a nonrefundable
examination fee in the amount required by Chapter 1202, Texas Government Code (such amount
per series to be the lesser of (i) 1/10th of 1% of the principal amount of such series of the
Certificates or (ii) $9,500.)
(d) The obligation of the Purchaser to accept delivery of the Certificates is subject to
the Purchaser being furnished with the final, approving opinion of Bracewell & Giuliani LLP,
bond counsel for the Town, which opinion shall be dated and delivered the Closing Date.
(e) The Mayor is hereby authorized and directed to execute the contractual agreement
with Southwest Securities, Inc. setting forth such firm's responsibilities as financial advisor to
the Town, and the terms thereof in the form presented at this meeting is hereby approved and
accepted.
Section 7.02. Control and Delivery of Certificates.
(a) The Mayor of the Town is hereby authorized to have control of the Initial
Certificate and all necessary records and proceedings pertaining thereto pending investigation,
examination, and approval of the Attorney General of the State of Texas, registration by the
Comptroller of Public Accounts of the State of Texas and registration with, and initial exchange
or transfer by, the Paying Agent/Registrar.
(b) After registration by the Comptroller of Public Accounts, delivery of the
Certificates shall be made to the Underwriter or a representative thereof under and subject to the
general supervision and direction of the Mayor, against receipt by the Town of all amounts due
to the Town under the terms of sale.
(c) In the event the Mayor or Town Secretary is absent or otherwise unable to execute
any document or take any action authorized herein, the Mayor Pro Tem and the Assistant Town
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Secretary, respectively, shall be authorized to execute such documents and take such actions, and
the performance of such duties by the Mayor Pro Tem and the Assistant Town Secretary shall for
the purposes of this Ordinance have the same force and effect as if such duties were performed
by the Mayor and Town Secretary, respectively.
Section 7.03. Deposit of Proceeds.
(a) First: All amounts received on the Closing Date as accrued interest on the
Certificates from the Certificate Date to the Closing Date, plus premium received on the
Certificates in the amount $4,065.70, shall be deposited to the Interest and Sinking Fund.
(b) Second: Proceeds of the Certificates in the amount of $3,000,000 The remaining
balance received on the Closing Date, shall be deposited to a special account of the Town, such
moneys to be dedicated and used solely for the purposes for which the Certificates are being
issued as herein provided in Section 3.01(i).
(c) Third: Premium received on the Certificates in the amount of $60,000 shall be
used to pay the cost of issuing the Certificates. To the extent any of such amount is not used for
such purposes, such excess shall be deposited to the Interest and Sinking Fund.
ARTICLE VIII
INVESTMENTS
Section 8.01. Investments.
(a) Money in the Interest and Sinking Fund created by this Ordinance, at the option
of the Town, may be invested in such securities or obligations as permitted under applicable law.
(b) Any securities or obligations in which such money is so invested shall be kept and
held in trust for the benefit of the Owners and shall be sold and the proceeds of sale shall be
timely applied to the making of all payments required to be made from the fund from which the
investment was made.
Section 8.02. Investment Income.
(a) Interest and income derived from investment of the Interest and Sinking Fund be
credited to such fund.
(b) Interest and income derived from investment of the funds to be deposited pursuant
to Section 7.03(b) hereof shall be credited to the account where deposited until the acquisition or
construction of said projects is completed and thereafter, to the extent such interest and income
are present, such interest and income shall be deposited to the Interest and Sinking Fund.
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ARTICLE IX
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 9.01. Payment of the Certificates.
On or before each Interest Payment Date for the Certificates and while any of the
Certificates are outstanding and unpaid, there shall be made available to the Paying
Agent/Registrar, out of the Interest and Sinking Fund, money sufficient to pay such interest on
and principal of, redemption premium, if any, and interest on the Certificates as will accrue or
mature on the applicable Interest Payment Date, maturity date and, if applicable, on a date of
prior redemption.
Section 9.02. Other Representations and Covenants.
(a) The Town will faithfully perform, at all times, any and all covenants,
undertakings, stipulations, and provisions contained in this Ordinance and in each Certificate; the
Town will promptly pay or cause to be paid the principal of, redemption premium, if any, and
interest on each Certificate on the dates and at the places and manner prescribed in such
Certificate; and the Town will, at the times and in the manner prescribed by this Ordinance,
deposit or cause to be deposited the amounts of money specified by this Ordinance.
(b) The Town is duly authorized under the laws of the State of Texas to issue the
Certificates; all action on its part for the creation and issuance of the Certificates has been duly
and effectively taken; and the Certificates in the hands of the Owners thereof are and will be
valid and enforceable obligations of the Town in accordance with their terms.
Section 9.03. Provisions Concerning Federal Income Tax Exclusion.
The Town intends that the interest on the Certificates shall be excludable from gross
income for federal income taxation pursuant to sections 103 and 141 through 150 of the Internal
Revenue Code of 1986, as amended (the "Code") and the applicable regulations promulgated
thereunder (the "Regulations"). The Town covenants and agrees not to take any action, or
knowingly omit to take any action within its control, that if taken or omitted, respectively, would
cause the interest on the Certificates to be includable in gross income, as defined in section 61 of
the Code of the holders thereof for purposes of federal income taxation. In particular, the Town
covenants and agrees to comply with each requirement of Sections 9.03 through 9.10, inclusive;
provided, however, that the Town shall not be required to comply with any particular
requirement of this Sections 9.03 through 9.10 of the holders thereof for purposes of federal
income taxation, if the Town has received an opinion of nationally recognized bond counsel
("Counsel's Opinion") that such noncompliance will not adversely affect the exclusion from
gross income for federal income tax purposes of interest on the Certificates or if the Town has
received a Counsel's Opinion to the effect that compliance with some other requirement set forth
in this Sections 9.03 through 9.10, inclusive, will satisfy the applicable requirements of the Code
and the Regulations, in which case compliance with such other requirement specified in such
Counsel's Opinion shall constitute compliance with the corresponding requirement specified in
Sections 9.03 through 9. 10, inclusive.
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Section 9.04. No Private Use or Payment and No Private Loan Financing.
The Town shall certify, through an authorized officer, employee or agent, that, based
upon all facts and estimates known or reasonably expected to be in existence on the date the
Certificates are delivered, that the proceeds of the Certificates will not be used in a manner that
would cause the Certificates to be "private activity bonds" within the meaning of section 141 of
the Code and the Regulations. The Town covenants and agrees that it will make such use of the
proceeds of the Certificates, including interest or other investment income derived from
Certificate proceeds, regulate the use of property financed, directly or indirectly, with such
proceeds, and take such other and further action as may be required so that the Certificates will
not be "private activity bonds" within the meaning of section 141 of the Code and the
Regulations.
Section 9.05. No Federal Guaranty.
The Town covenants and agrees not to take any action, or knowingly omit to take any
action, and has not knowingly omitted and will not knowingly omit to take any action within its
control, that, if taken or omitted, respectively, would cause the Certificates to be "federally
guaranteed" within the meaning of section 149(b) of the Code and the Regulations, except as
permitted by section 149(b)(3) of the Code and the Regulations.
Section 9.06. Certificates are not Hedge Certificates.
The Town covenants and agrees that it has not taken and will not take any action, and has
not knowingly omitted and will not knowingly omit to take any action within its control, that, if
taken or omitted, respectively, would cause the Certificates to be "hedge bonds" within the
meaning of section 149(g) of the Code and the Regulations.
Section 9.07. No -Arbitrage Covenant.
The Town shall certify, through an authorized officer, employee or agent, that, based
upon all facts and estimates known or reasonably expected to be in existence on the date the
Certificates are delivered, the Town will reasonably expect that the proceeds of the Certificates
will not be used in a manner that would cause the Certificates to be "arbitrage bonds" within the
meaning of section 148(a) of the Code and the Regulations. Moreover, the Town covenants and
agrees that it will make such use of the proceeds of the Certificates, including interest or other
investment income derived from Certificate proceeds, regulate investments of proceeds of the
Certificates, and take such other and further action as may be required so that the Certificates
will not be "arbitrage bonds" within the meaning of section 148(a) of the Code and the
Regulations.
Section 9.08. Arbitrage Rebate.
If the Town does not qualify for an exception to the requirements of Section 148(f) of the
Code, the Town will take all necessary steps to comply with the requirement that certain amounts
earned by the Town on the investment of the "gross proceeds" of the Certificates (within the
meaning of section 148(f)(6)(B) of the Code), be rebated to the federal government.
Specifically, the Town will (i) maintain records regarding the investment of the gross proceeds
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of the Certificates as may be required to calculate the amount earned on the investment of the
gross proceeds of the Certificates separately from records of amounts on deposit in the funds and
accounts of the Town allocable to other issues of the Town or moneys which do not represent
gross proceeds of any issues of the Town, (ii) calculate at such times as are required by the
Regulations the amount earned from the investment of the gross proceeds of the Certificates
which is required to be rebated to the federal government, and (iii) pay, not less often than every
fifth anniversary date of the delivery of the Certificates or on such other dates as may be
permitted under the Regulations, all amounts required to be rebated to the federal government.
Further, the Town will not indirectly pay any amount otherwise payable to the federal
government pursuant to the foregoing requirements to any person other than the federal
government by entering into any investment arrangement with respect to the gross proceeds of
the Certificates that might result in a reduction in the amount required to be paid to the federal
government because such arrangement results in a smaller profit or a larger loss than would have
resulted if the arrangement had been at arm's length and had the yield on the issue not been
relevant to either party.
Section 9.09. Information Reporting.
The Town covenants and agrees to file or cause to be filed with the Secretary of the
Treasury, not later than the 15th day of the second calendar month after the close of the calendar
quarter in which the Certificates are issued, an information statement concerning the Certificates,
all under and in accordance with section 149(e) of the Code and the Regulations.
Section 9.10. Continuing Obli ag tion.
Notwithstanding any other provision of this Ordinance, the Town's obligations under the
covenants and provisions of Sections 9.03 through 9.09, inclusive, shall survive the defeasance
and discharge of the Certificates.
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Section 9.11. Qualified Tax -Exempt Obligations.L The Town hereby designates the
Certificates as "qualified tax-exempt obligations" for purposes of section 265(b) of the Code. In
connection therewith, the Town represents (a) that the aggregate amount of tax-exempt
obligations issued by the Town during calendar year 2013, including the Certificates, which have
been designated as "qualified tax-exempt obligations" under section 265(b)(3) of the Code does
not exceed $10,000,000, and (b) that the reasonably anticipated amount of its tax-exempt
obligations which will be issued by the Town during calendar year 2013, including the
Certificates, will not exceed $10,000,000. For purposes of this Section 9.11, the term "tax-
exempt obligations" does not include "private activity bonds" within the meaning of section 141
of the Code, other than "qualified 501(c)(3) bonds" within the meaning of section 145 of the
Code. In addition, for purposes of this Section 9.11, the Town includes all governmental units
which are aggregate with the Town under section 265(b) of the Code.
ARTICLE X
DEFAULT AND REMEDIES
Section 10.01. 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:
(i) the failure to make payment of the principal of, redemption premium, if
any, or interest on any of the Certificates when the same becomes due and payable; or
(ii) default in the performance or observance of any other covenant,
agreement, or obligation of the Town, which default materially and adversely affects the
rights of the Owners, 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 sixty (60)
days after notice of such default is given by any Owner to the Town.
Section 10.02. Remedies for Default.
(a) Upon the happening of any Event of Default, then any Owner or an authorized
representative thereof, including but not limited to a trustee or trustees therefor, may proceed
against the Town for the purpose of protecting and enforcing the rights of the 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 Owners hereunder or any combination of
such remedies.
(b) It is provided that all such proceedings shall be instituted and maintained for the
equal benefit of all Owners of Certificates then outstanding.
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Section 10.03. Remedies Not Exclusive.
(a) No remedy herein conferred or reserved is intended to be exclusive of any other
available remedy, but each and every such remedy shall be cumulative and shall be in addition to
every other remedy given hereunder or under the Certificates 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 Certificates shall not be available as a remedy under
this Ordinance.
(b) The exercise of any remedy herein conferred or reserved shall not be deemed a
waiver of any other available remedy.
ARTICLE XI
DISCHARGE
Section 11.01. Discharge.
The Certificates may be defeased, discharged or refunded in any manner permitted by
applicable law.
ARTICLE XII
CONTINUING DISCLOSURE UNDERTAKING
Section 12.01. Annual Reports.
(i) The Town shall provide annually to the MSRB, within six (6) months after
the end of each fiscal year, financial information and operating data with respect to the
Town of the general type included in the final Official Statement, being the information
described in Exhibit A hereto. Any financial statements so to be provided shall be (i)
prepared in accordance with the accounting principles described in Exhibit A hereto, and
(ii) audited, if the Town commissions an audit of such statements and the audit is
completed within the period during which they must be provided, and (iii) submitted
through the EMMA, in an electronic format with accompanying identifying information,
as prescribed by the MSRB. If the audit of such financial statements is not complete
within such period, then the Town shall provide notice that audited financial statements
are not available and shall provide unaudited financial statements for the applicable fiscal
year to the MSRB. The Town shall provide audited financial statements for the applicable
fiscal year to the MSRB when and if audited financial statements become available.
(ii) If the Town changes its fiscal year, it will notify the MSRB of the change
(and of the date of the new fiscal year end) prior to the next date by which the Town
otherwise would be required to provide financial information and operating data pursuant
to this Section.
(iii) 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
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specific referenced to any document (including an official statement or other offering
document, if it is available from the MSRB) that theretofore has been provided to the
MSRB or filed with the SEC.
Section 12.02. Material Event Notices.
(a) The Town shall notify the MSRB, in a timely manner not in excess of ten (10)
Business Days after the occurrence of the event, of any of the following events with respect to
the Certificates:
(i) Principal and interest payment delinquencies;
(ii) Non-payment related defaults, if material;
(iii) Unscheduled draws on debt service reserves reflecting financial
difficulties;
(iv) Unscheduled draws on credit enhancements reflecting financial
difficulties;
(v) Substitution of credit or liquidity providers, or their failure to perform;
(vi) Adverse tax opinions, the issuance by the Internal Revenue Service of
proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form
5701-TEB) or other material notices or determinations with respect to the tax status of the
Certificates, or other material events affecting the tax status of the Certificates;
(vii) Modifications to rights of holders of the Certificates, if material;
(viii) Certificate calls, if material, and tender offers;
(ix) Defeasances;
(x) Release, substitution, or sale of property securing repayment of the
Certificates, if material;
(xi) Rating changes;
(xii) Bankruptcy, insolvency, receivership or similar event of the Town;'
' For the purposes of the event identified in (xii), the event is considered to occur when any of the
following occur: the appointment of a receiver, fiscal agent, or similar officer for an obligated person in a
proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in
which a court or governmental authority has assumed jurisdiction over substantially all of the assets or
business of the obligated person, or if such jurisdiction has been assumed by leaving the existing
governing body and officials or officers in possession but subject to the supervision and orders of a court
or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement, or
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(xiii) The consummation of a merger, consolidation, or acquisition involving the
Town or the sale of all or substantially all of the assets of the Town, other than in the
ordinary course of business, the entry into a definitive agreement to undertake such an
action or the termination of a definitive agreement relating to any such actions, other than
pursuant to its terms, if material; and
(xiv) Appointment of a successor Paying Agent/Registrar or change in the name
of the Paying Agent/Registrar, if material.
(b) The Town shall provide to the MSRB, in an electronic format as prescribed by the
MSRB, in a timely manner, notice of a failure by the Town to provide required annual financial
information and notices of material events in accordance with Sections 12.01 and 12.02. All
documents provided to the MSRB pursuant to this section shall be accompanied by identifying
information as prescribed by the MSRB.
Section 12.03. Limitations, Disclaimers and Amendments.
(a) The Town shall be obligated to observe and perform the covenants specified in
this Article for so long as, but only for so long as, the Town remains an "obligated person" with
respect to the Certificates within the meaning of the Rule, except that the Town in any event will
give notice of any redemption calls and any defeasances that cause the Town to be no longer an
"obligated person."
(b) The provisions of this Article are for the sole benefit of the Owners and beneficial
owners of the Certificates, and nothing in this Article, express or implied, shall give any benefit
or any legal or equitable right, remedy, or claim hereunder to any other person. The Town
undertakes to provide only the financial information, operating data, financial statements, and
notices which it has expressly agreed to provide pursuant to this Article and does not hereby
undertake to provide any other information that may be relevant or material to a complete
presentation of the Town's financial results, condition, or prospects or hereby undertake to
update any information provided in accordance with this Article or otherwise, except as
expressly provided herein. The Town does not make any representation or warranty concerning
such information or its usefulness to a decision to invest in or sell Certificates at any future date.
UNDER NO CIRCUMSTANCES SHALL THE TOWN BE LIABLE TO THE OWNER
OR BENEFICIAL OWNER OF ANY CERTIFICATE OR ANY OTHER PERSON, IN
CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM
ANY BREACH BY THE TOWN, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS
PART, OF ANY COVENANT SPECIFIED IN THIS ARTICLE, 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.
liquidation by a court or governmental authority having supervision or jurisdiction over substantially all
of the assets or business of the obligated person.
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(c) No default by the Town in observing or performing its obligations under this
Article shall constitute a breach of or default under the Ordinance for purposes of any other
provisions of this Ordinance.
(d) Nothing in this Article is intended or shall act to disclaim, waive, or otherwise
limit the duties of the Town under federal and state securities laws.
(e) The provisions of this Article may be amended by the Town from time to time to
adapt to changed circumstances that arise from a change in legal requirements, a change in law,
or a change in the identity, nature, status, or type of operations of the Town, but only if (i) the
provisions of this Article, as so amended, would have permitted an underwriter to purchase or
sell Certificates in the primary offering of the Certificates 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 (ii) either (A) the Owners of a majority in aggregate
principal amount (or any greater amount required by any other provisions of this Ordinance that
authorizes such an amendment) of the Outstanding Certificates consent to such amendment or
(B) an entity or individual person that is unaffiliated with the Town (such as nationally
recognized bond counsel) determines that such amendment will not materially impair the
interests of the Owners and beneficial owners of the Certificates. If the Town so amends the
provisions of this Article, it shall include with any amended financial information or operating
data next provided in accordance with Section 12.01 an explanation, in narrative form, of the
reasons for the amendment and of the impact of any change in type of financial information or
operating data so provide.
ARTICLE XIII
AMENDMENTS
Section 13.01. Amendments.
This Ordinance shall constitute a contract with the Owners, be binding on the Town, and
shall not be amended or repealed by the Town so long as any Certificate remains outstanding
except as permitted in this Section. The Town may, without consent of or notice to any Owners,
from time to time and at any time, amend this Ordinance in any manner not detrimental to the
interests of the Owners, including the curing of any ambiguity, inconsistency, or formal defect or
omission herein. In addition, the Town may, with the written consent of the Owners of the
Certificates holding a majority in aggregate principal amount of the Certificates then
outstanding, amend, add to, or rescind any of the provisions of this Ordinance; provided that,
without the consent of all Owners of outstanding Certificates, no such amendment, addition, or
rescission shall (i) extend the time or times of payment of the principal of and interest on the
Certificates, reduce the principal amount thereof, the redemption price, or the rate of interest
thereon, or in any other way modify the terms of payment of the principal of or interest on the
Certificates, (ii) give any preference to any Certificate over any other Certificate, or (iii) reduce
the aggregate principal amount of Certificates required to'be held by Owners for consent to any
such amendment, addition, or rescission.
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ARTICLE XIV
MISCELLANEOUS
Section 14.01. Changes to Ordinance. The Mayor and Director of Finance, in
consultation with Bond Counsel, are hereby authorized to make changes to the terms of this
Ordinance if necessary or desirable to carry out the purposes hereof or in connection with the
approval of the issuance of the Certificates by the Attorney General of Texas.
Section 14.02. Partial Invalidity. If any section, paragraph, clause or provision of this
Ordinance shall for any reason be held to be invalid or unenforceable, the invalidity or
unenforceability of such section, paragraph, clause or provision shall not affect any of the
remaining provisions of the Ordinance.
Section 14.03. No Personal Liability. No recourse shall be had for payment of the
principal of or interest on any Certificates or for any claim based thereon, or on this Ordinance,
against any official or employee of the Town or any person executing any Certificates.
ARTICLE XV
EFFECTIVENESS
Section 15.01. Effectiveness.
This Ordinance shall take effect immediately from and after its passage.
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APPROV AND
O �G
O to
KI
ATTEST:"' /VUAR�
PTED this August 5, 2013.
r
Town Secretary, T of Trophy Club, Texas
APPROVED AS TO FORM:
Town Attorney
By:
To':)d Counsel
ayor, Town of Trophy Club, Texas
Signature Page for Ordinance
Series 2013 Combination Tax and Revenue Certificates of Obligation
EXHIBIT A
DESCRIPTION OF ANNUAL DISCLOSURE OF FINANCIAL INFORMATION
The following information is referred to in Article XII of this Ordinance.
Annual Financial Statements and Operating Data
The financial information and operating data with respect to the Town to be provided
annually in accordance with such Section are as specified (and included in the Appendix or other
headings of the Official Statement referred to) below:
1. The portions of the financial statements of the Town appended to the Official
Statement as Appendix B, but for the most recently concluded fiscal year.
2. Statistical and financial data set forth in Tables 1, 2, 3, 9, 10, 12, 13, 14 and 20 of
Appendix A.
Accounting Principles
The accounting principles referred to in such Section are the accounting principles
described in the notes to the financial statements referred to in Paragraph 1 above.
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