ORD 2010-02240640v.1 TEMIIOl1l2079
TOWN OF TROPHY CLUB, TEXAS
ORDINANCE NO. 2010-02
AUTHORIZING THE ISSUANCE OF
$560,000
TOWN OF TROPHY CLUB, TEXAS
TAX NOTES,
SERIES 2010
Adopted: February 1,2010
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND OTHER PRELIMINARY MATTERS
Section 1.01. Definitions ............................................................................................................... 2
Section 1.02. Other Definitions .................................................................................................... .3
Section 1.03. Findings .................................................................................................................. .3
Section 1.04. Table of Contents, Titles and Headings ................................................................... 3
Section I.OS. Interpretation ........................................................................................................... .3
ARTICLE II
SECURITY FOR THE NOTES
Section 2.01. Tax Levy for Payment of the Notes ......................................................................... 4
ARTICLE III
AUTHORIZATION; GENERAL TERMS AND PROVISIONS REGARDING THE NOTES
Section 3.01. Authorization .......................................................................................................... .4
Section 3.02. Date, Denomination, Maturities, Numbers and Interest. ......................................... S
Section 3.03. Medium, Method and Place ofPayment.. ................................................................ S
Section 3.04. Execution and Initial Registration ........................................................................... 6
Section 3.0S. Ownership ................................................................................................................ 7
Section 3.06. Registration, Transfer and Exchange ....................................................................... 7
Section 3.07. Cancellation and Authentication .............................................................................. 8
Section 3.08. Temporary Notes ..................................................................................................... 8
Section 3.09. Replacement Notes .................................................................................................. 9
ARTICLE IV
NO REDEMPTION OF NOTES BEFORE MATURITY
Section 4.01. Limitation on Redemption ..................................................................................... 1 0
Section 4.02. No Optional Redemption ....................................................................................... 1 0
ARTICLE V
PAYING AGENT/REGISTRAR
Section S.O 1. Appointment oflnitial Paying Agent/Registrar ..................................................... 1 0
Section S.02. Qualifications ......................................................................................................... 10
(i)
Ordinance No. 20 I 0-02 (File 1D 20 I 0-56)
Section 5.03. Maintaining Paying AgentlRegistrar ..................................................................... 10
Section 5.04. Tennination ............................................................................................................ 10
Section 5.05. Notice of Change ................................................................................................... 11
Section 5.06. Agreement to Perfonn Duties and Functions ........................................................ 11
Section 5.07. Delivery of Records to Successor ......................................................................... .11
ARTICLE VI
FORM OF THE NOTES
Section 6.01. Fonn Generally ....................................................................... , .............................. 11
Section 6.02. Fonn of Notes ........................................................................................................ 12
Section 6.03. CUSIP Registration ................................................................................................ 16
Section 6.04. Legal Opinion ........................................................................................................ 16
Section 6.05. Municipal Bond Insurance ..................................................................................... 16
ARTICLE VII
SALE OF THE NOTES; CONTROL AND DELIVERY OF THE NOTES
Section 7.01. Sale of Notes; Official Statement ......................................................................... .17
Section 7.02. Control and Delivery of Notes ............................................................................... 17
ARTICLE VIII
CREATION OF FUNDS AND ACCOUNTS; DEPOSIT OF PROCEEDS; INVESTMENTS
Section 8.01. Creation of Funds ................................................................................................... 18
Section 8.02. Interest and Sinking Fund ..................................................................................... .18
Section 8.03. Project Fund ........................................................................................................... 18
Section 8.04. Security of Funds ................................................................................................... 19
Section 8.05. Deposit of Proceeds ............................................................................................... 19
Section 8.06. Investments ............................................................................................................ 19
Section 8.07. Investment Income ................................................................................................. 19
ARTICLE IX
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 9.01. Payment of the Notes ............................................................................................. 19
Section 9.02. Other Representations and Covenants ................................................................... 19
Section 9.03. Provisions Concerning Federal Income Tax Exclusion ......................................... 20
Section 9.04. No Private Use or Payment and No Private Loan Financing ................................ 20
Section 9.05. No Federal Guaranty ............................................................................................. .20
Section 9.06. Notes are not Hedge Bonds ................................................................................... 21
Section 9.07. No-Arbitrage Covenant. ......................................................................................... 21
Section 9.08. Arbitrage Rebate .................................................................................................... 21
(ii)
Ordinance No. 2010·02 (File ID 20 10·56)
Section 9.09. Information Reporting ........................................................................................... 21
Section 9.10. Qualified Tax-Exempt Obligations ........................................................................ 22
Section 9.11. Continuing Obligation ........................................................................................... 22
ARTICLE X
DEF AUL T AND REMEDIES
Section 10.01. Events of Default. .................................................................................................. 22
Section 10.02. Remedies for Default ............................................................................................. 22
Section 10.03. Remedies Not Exclusive ........................................................................................ 23
ARTICLE XI
DISCHARGE
Section 11.01. Discharge ............................................................................................................... 23
ARTICLE XII
EFFECTIVE IMMEDIATELY
Section 12.01. Effectiveness .......................................................................................................... 23
(iii)
Ordinance No. 20 I 0-02 (File lD 20 10-56)
AN ORDINANCE OF THE TOWN OF TROPHY CLUB,
TEXAS, AUTHORIZING THE ISSUANCE AND SALE OF
TOWN OF TROPHY CLUB, TEXAS, TAX NOTES, SERIES
2010, IN THE AGGREGATE PRINCIPAL AMOUNT OF
$560,000; APPROVING A NOTE PURCHASE AGREEMENT
AND ENGAGEMENT LETTER; LEVYING A TAX IN
PAYMENT THEREOF; PRESCRIBING THE FORM OF SAID
NOTES; AND ENACTING OTHER PROVISIONS RELATING
TO THE SUBJECT
WHEREAS, pursuant to Chapter 1431, Texas Government Code (the "Act"), the
governing body of a municipality is authorized to issue the notes hereinafter authorized (the
"Notes") to pay contractual obligations incurred or to be incurred for the purposes set forth in
Section 3.01 hereof; and
WHEREAS, this governing body (the "Town Council") of the Town of Trophy Club,
Texas (the "Town"), hereby finds and determines that it is necessary and in the best interest of
the Town and its citizens to issue such Notes for the purposes herein described and that such
Notes shall be payable from and secured by ad valorem taxes levied, within the limits prescribed
by law, on all taxable property within the Town; and
WHEREAS, the Notes hereinafter authorized shall mature before the seventh anniversary
of the date that the Attorney General of the State of Texas approves the Notes, as required by the
Act; and
WHEREAS, it is affirmatively found that this Town Council is authorized to proceed
with the issuance and sale of such Notes as authorized by the Constitution and laws of the State
of Texas, particularly the Act; and
WHEREAS, the Town Council has found and determined that it is necessary and in the
best interest of the Town and its citizens that it authorize by this Ordinance the issuance and
delivery of its Notes in a single series at this time; and
WHEREAS, it is officially found, detennined, and declared that the meeting at which this
Ordinance has been adopted was open to the public and public notice of the time, place and
subject matter of the public business to be considered and acted upon at said meeting, including
this Ordinance, was given, all as required by the applicable provisions of Chapter 551, Texas
Goverrunent Code, as amended; Now Therefore,
BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF TROPHY CLUB:
Ordinance No. 2010-02 (File JD 2010-56)
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 tenns shall have the meanings specified below:
"Closing Date" means the date of the initial delivery of and payment for the Notes.
"Code" means the Internal Revenue Code of 1986, as amended, including applicable
regulations, published rulings and court decisions relating thereto.
"Designated Payment/Transfer Office" means (i) with respect to the initial Paying
Agent/Registrar named herein, its office in Fort Worth, Texas, or at such other location
designated by the Paying AgentlRegistrar and (ii) with respect to any successor Paying
AgentlRegistrar, the office of such successor designated and located as may be agreed upon by
the Town and such successor.
"Event of Default" means any Event of Default as defined in Section 10.01.
"Initial Note" means the Note described in Section 3.04(d) and 6.02(d).
"Interest and Sinking Fund" means the interest and sinking fund established by
Section 8.01(a).
"Interest Payment Date" means the date or dates upon which interest on the Notes is
scheduled to be paid until the maturity of the Notes, such dates being March 1 and September I
of each year commencing September 1,2010.
"Note" means any of the Notes.
"Notes" means the Town's notes entitled "Town of Trophy Club, Texas, Tax Notes,
Series 2010" authorized to be issued by Section 3.01.
"Ordinance" means this Ordinance.
"Owner" means the person who is the registered owner of a Note or Notes, as shown in
the Register.
"Paying AgentlRegistrar" means initially TIE-The Independent BankersBank, or any
successor thereto as provided in this Ordinance.
"Paying AgentlRegistrar Agreement" means the Paying AgentlRegistrar Agreement
between the Town and the Paying AgentlRegistrar relating to the Notes.
"Project Fund" means the construction fund established by Section 8.01 (a).
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Ordinance No. 2010·02 (File 1D 2010-56)
"Purchaser" means TIB-The Independent BanlcersBank.
"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) .
. "Special Payment Date" means the Speciaf Payment Date prescribed by Section 3.03(b).
"Special Record Date" means the Special Record Date prescribed by Section 3.03(b).
"Unclaimed Payments" means money deposited with the Paying AgentlRegistrar for the
payment of the principal of or interest on Notes as the same become due and payable and
remaining unclaimed by the Owners of such Notes for 90 days after the applicable payment or
redemption date.
Section 1.02. Other Definitions.
The terms "Town Council" and "Town" shall have the meaning assigned in the preamble
to this Ordinance.
Section 1.03. Findings.
The declarations, detenninations 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 1.04. 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
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 1.05. Interpretation.
(a) Unless the context requires otherwise, words of the masculine gender shall be
construed to include conelative words of the feminine and neuter genders and vice versa, and
words of the singular number shall be construed to include conelative words of the plural
number and vice versa.
(b) Article and section references shall mean references to articles and sections of this
Ordinance unless designated otherwise.
(c) This Ordinance and all the terms and proVISIOns hereof shall be liberally
construed to effectuate the purposes set forth herein to sustain the validity of this Ordinance.
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Ordinance No. 2010-02 (File ID 2010-56)
ARTICLE II
SECURlTY FOR THE NOTES
Section 2.01. Tax Levy for Payment of the Notes.
(a) The Town Council hereby declares and covenants that it will provide and levy a
tax legally and fully sufficient for payment of the Notes, it having been determined that the
existing and available taxing authority of the Town for such purpose is adequate to permit a
legally sufficient tax in consideration of all other outstanding obligations of the Town.
(b) In order to provide for the payment of the debt service requirements on the Notes,
being (i) the interest on the Notes, and (ii) a sinking fund for their payment at maturity or a
sinking fund of two percent per annum (whichever amount is the greater), there is hereby levied
for the current year and each succeeding year thereafter, while the Notes or interest thereon
remain 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
such debt service requirements, full allowance being made for delinquencies and costs of
collection.
( c) The tax levied by this Section shall be assessed and collected each year and
deposited into the Interest and Sinking Fund for the payment of the debt service requirements on
the Notes, and the tax shall not be diverted to any other purpose.
(d) 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 Notes when and as
due and payable in accordance with their terms and this Ordinance.
(e) If the liens and provisions of this Ordinance shall be discharged in a manner
permitted by Article XI, 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.
ARTICLE III
AUTHORlZATION; GENERAL TERMS AND PROVISIONS
REGARDING THE NOTES
Section 3.01. Authorization.
The Town's notes to be designated "Town of Trophy Club, Texas Tax Notes, Series
2010," are hereby authorized to be issued and delivered in accordance with the Constitution and
laws of the State of Texas, particularly Chapter 1431, Texas Government Code, as amended, and
the Town's Home Rule Charter, in the aggregate principal amount of $560,000 for tlle public
purpose of providing funds for (i) acquiring vehicles and equipment for the Town's Parks,
Police, Street and Emergency Medical Services departments; and (ii) design, engineering and
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Ordinance No. 2010-02 (File 1D 2010-56)
construction of park and recreation improvements; and (iii) payment of the costs and expenses
associated with issuing the Notes.
Section 3.02. Date, Denomination, Maturities, Numbers and Interest.
(a) The Notes shall be dated the date of their delivery to the Purchaser, 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 or such other designation acceptable
to the Town and the Paying AgenURegistrar, except the Initial Note, which shall be numbered T-
1.
(b) The Notes shall mature on March 1 in the years and in the principal installments
set forth in the following schedule:
Maturity Principal Amount Interest Rate
201] $ 95,000 2.480%
2012 $100,000 2.940%
2013 $100,000 3.330%
2014 $ 80,000 3.730%
20]5 $ 85,000 4.190%
2016 $ 50,000 4.700%
";;
2017 $ 50,000 5.0]0%
(c) Interest shall accrue and be paid on each Note, respectively, until the payment of
the principal amount thereof shall have been paid or provided for, from the later of the Closing
Date or the most recent Interest Payment Date to which interest has been paid or provided for at
the rates per annum for each respective maturity specified in the schedule contained in
subsection (b) above. Such interest shall be payable semiannually on each March I and
September] of each year, commencing on September I, 2010, until maturity or prior
redemption. Interest on the Notes shall be calculated on the basis of a 360-day year composed of
twelve 30-day months.
Section 3.03. Medium, Method and Place of Payment.
(a) The principal of, premium, if any, and interest on the Notes shall be paid in lawful
money of the United States of America as provided in this Section.
(b) Interest on the Notes shall be payable to the Owners whose names appear in the
Register at the close of business on the Record Date; provided, however, that 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") will be established by the
- 5 -
Ordinance No. 2010·02 (File lD 20 I 0-56)
Paying AgentlRegistrar if and when funds for the payment of such interest have been received
from the Town. Notice ofthe Special Record Date and of the scheduled payment date of the past
due interest (the "Special Payment Date," which shall be at least 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 Note appearing on the books
of the Paying AgentlRegistrar at the close of business on the last business day next preceding the
date of mailing of such notice.
(c) Interest on the Notes shall be paid by check (dated as of the Interest Payment
Date) and sent by the Paying AgentlRegistrar to the person entitled to such payment, United
States mail, first class postage prepaid, to the address of such person as it appears in the Register
or by such otller customary banking arrangements acceptable to the Paying AgentlRegistrar and
tlle person to whom interest is to be paid; provided, however, that such person shall bear all risk
and expenses of such other customary banking arrangements.
(d) The principal of each Note shall be paid to the person in whose name such Note is
registered on tlle due date thereof (whether at the maturity date or the date of prior redemption
thereof) upon presentation and surrender of such Note at the Designated Payment/Transfer
Office. So long as the Purchaser is the Owner ofrecord of the Notes, presentation and surrender
of any Note is not required, and payment of such principal amount to the Owner may be by wire
transfer.
(e) If a date for the payment of the principal of or interest on the Notes is a Saturday,
Sunday, legal holiday, or a day on which banking institutions in the Town in which the
Desigilated Payment/Transfer Office is located are authorized by law or executive order to close,
then the date for such payment shall be the next succeeding day which is not a Saturday, Sunday,
legal holiday, or day on which such banking institutions are authorized to close; and payment on
such date shall have the same force and effect as if made on the original date payment was i:!ue.
(f) Subject to any applicable escheat, unclaimed property, or similar law, including
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 paid to
the Town and thereafter neither the Town, the Paying Agent/Registrar, nor any other person shall
be liable or responsible to any Owners of such Notes for any further payment of such unclaimed
moneys or on account of any such Notes.
Section 3.04. Execution and Initial Registration.
(a) The Notes shall be executed on behalf of tlle Town by the Mayor and Town
Secretary of the Town, 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 Notes shall
have the same effect as if each of the Notes had been signed manually and in person by each of
said officers, and such facsimile seal on the Notes shall have the same effect as if the official seal
of the Town had been manually impressed upon each of the Notes.
(b) In the event that any officer of the Town whose manual or facsimile signature
appears on the Notes ceases to be such officer before the authentication of such Notes or before
- 6 -
Ordinance No. 2010-02 (File ID 201 0-56)
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 Note 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 AgentlRegistrar substantially in the form provided in this Ordinance, duly
authenticated by manual execution of the Paying AgentlRegistrar. It shall not be required that
the same authorized representative of the Paying Agent/Registrar sign the Certificate of Paying
AgentlRegistrar on all of the Notes. In lieu of the executed Certificate of Paying AgentlRegistrar
described above, the Initial Note delivered on the Closing Date shall have attached thereto the
Comptroller'S Registration Certificate substantially in the form provided in this Ordinance,
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 Initial Note has been duly approved
by the Attorney General of the State of Texas and that it is a valid and binding obligation of the
Town, and has been registered by the Comptroller.
(d) On the Closing Date, one Initial Note representing the entire principal amount of
the Notes, payable in stated installments to the initial purchaser or its designee, executed by
manual or facsimile signature of the Mayor and Town Secretary of the Town, approved by the
Attorney General of Texas, and registered and manually signed by the Comptroller of Public
Accounts of the State of Texas, will be delivered to the Purchaser or its designee.
Section 3.05. Ownership.
(a) The Town, the Paying AgentlRegistrar and any other person may treat the person
in whose name any Note is registered as the absolute owner of such Note for the purpose of
malting and receiving payment of the principal thereof and premium, if any, thereon, for the
further purpose of miling and receiving payment of the interest thereon (subject to the
provisions herein that interest is to be paid to the person in whose name the Note is registered on
the Record Date), and for all other purposes, whether or not such Note is overdue, and neither the
Town nor the Paying AgentlRegistrar shall be bound by any notice or lmowledge to the contrary.
(b) All payments made to the person deemed to be the Owner of any Note in
accordance with this Section shall be valid and effectual and shall discharge the liability of the
Town and the Paying Agent/Registrar upon such Note to the extent of the sums paid.
Section 3.06. Registration, Transfer and Exchange.
(a) So long as any Notes remain outstanding, the Town shall cause the Paying
AgentlRegistrar 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 Notes in accordance with this Ordinance.
(b) The ownership of a Note may be transferred only upon the presentation and
surrender of the Note 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 Note shall be effective until entered in the Register.
- 7 -
Ordinance No. 2010-02 (File lD 2010-56)
(c) The Notes shall be exchangeable upon the presentation and surrender thereof at
the Designated Payment/Transfer Office of the Paying Agent/Registrar for a Note or Notes of the
same maturity and interest rate and in any denomination or denominations of any integral
multiple of $5,000 and in an aggregate principal amount equal to the unpaid principal amount of
the Notes presented for exchange. The Paying AgentlRegistrar is hereby authorized to
authenticate and deliver Notes exchanged for other Notes in accordance with this Section.
(d) Each exchange Note delivered by the Paying Agent! Registrar in accordance with
this Section shall constitute an original contractual obligation of the Town and shall be entitled to
the benefits and security of this Ordinance to the same extent as the Note or Notes in lieu of
which such exchange Note is delivered.
(e) No service charge shall be made to the Owner for the initial registration,
subsequent transfer, or exchange for any different denomination of any of the Notes. The Paying
AgentlRegistrar, however, may require the Owner to pay a sum sufficient to cover any tax or
other goverrunental charge that is authorized to be imposed in connection with the registration,
transfer or exchange of a Note.
Section 3.07. Cancellation and Authentication.
All Notes paid or redeemed before scheduled maturity in accordance with this Ordinance,
and all Notes in lieu of which exchange Notes or replacement Notes are authenticated and
delivered in accordance with this Ordinance, shall be cancelled upon the making of proper
records regarding such payment, redemption, exchange or replacement. The Paying
AgentlRegistrar sh811 dispose of the cancelled Notes in accordance with the Securities Exchange
Act of1934.
Section 3.08. Temporary Notes.
(a) Following the delivery and registration of the Initial Note and pending the
preparation of definitive Notes, the proper officers of the Town may execute and, upon the
Town's request, the Paying AgentlRegistrar shall authenticate and deliver, one or more
temporary Notes that are printed, lithographed, typewritten, mimeographed or otherwise
produced, in any denomination, substantially of the tenor of the definitive Notes 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 Notes
may determine, as evidenced by their signing of such temporary Notes.
(b) Until exchanged for Notes in definitive form, such Notes 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 Notes in definitive form; thereupon, upon the presentation and
surrender of the Note or Notes in temporary form to the Paying AgentlRegistrar, the Paying
AgentlRegistrar shall cancel the Notes in temporary form and authenticate and deliver in
exchange therefor a Note or Notes of the same maturity and series, in definitive form, in the
authorized denomination, and in the same aggregate principal amount, as the Note or Notes in
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Ordinance No. 2010-02 (File lD 2010-56)
temporary fonn surrendered. Such exchange shall be made without the making of any charge
therefor to any Owner.
Section 3.09. Replacement Notes.
(a) Upon the presentation and surrender to the Paying AgentlRegistrar, at the
Designated Payment/Transfer Office, of a mutilated Note, the Paying AgentlRegistrar shall
authenticate and deliver in exchange therefor a replacement Note of like tenor and principal
amount, bearing a number not contemporaneously outstanding. The Town or the Paying
AgentlRegistrar may require the Owner of such Note 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 Note is lost, apparently destroyed or wrongfully taken, the
Paying Agent/Registrar, pursuant to the applicable laws oftlle State of Texas and in the absence
of notice or knowledge that such Note has been acquired by a bona fide purchaser, shall
authenticate and deliver a replacement Note of like tenor and principal amount, bearing a number
not contemporaneously outstanding, provided that the Owner first:
(i) furnishes to the Paying AgentlRegistrar satisfactory evidence of his or her
ownership of and the circumstances of the loss, destruction or theft of such Note;
(ii) furnishes such security or indemnity as may be required by the Paying
AgentlRegistrar and the Town to save them harmless;
(iii) pays all expenses and charges in connection therewith, including, but not
limited to, printing costs, legal fees, fees of the Paying AgentlRegistrar 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 AgentlRegistrar.
(c) If, after the delivery of such replacement Note, a bona fide purchaser of the
original Note in lieu of which such replacement Note was issued presents for payment such
original Note, the Town and the Paying Agent/Registrar shall be entitled to recover such
replacement Note 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 tlle
Paying Agent/Registrar in connection therewith.
(d) In the event that any such mutilated, lost, apparently destroyed or wrongfully
talcen Note has become or is about to become due and payable, the Paying Agent/Registrar, in its
discretion, instead of issuing a replacement Note, may pay such Note.
(e) Each replacement Note delivered in accordance with this Section shall constitute
an original contractual obligation of the Town and shall be entitled to the benefits and security of
this Ordinance to the same extent as the Note or Notes in lieu of which such replacement Note is
delivered.
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Ordinance No. 2010-02 (File ID 20 I 0-56)
ARTICLE IV
NO REDEMPTION OF NOTES BEFORE MATURlTY
Section 4.01. Limitation on Redemption.
The Notes shall be subject to redemption before their scheduled maturity only as
provided in this Article IV.
Section 4.02. No Optional Redemption.
The Notes shall not be subject to optional redemption before their Scheduled Maturity.
ARTICLE V
PAYING AGENTIREGISTRAR
Section 5.01. Appointment ofInitial Paying AgentlRegistrar.
TIB-The Independent BankersBank, is hereby appointed as the initial Paying
AgentlRegistrar for the Notes.
Section 5.02. Qualifications.
Each Paying AgentlRegistrar shall be a commercial bank, a trust company organized
under the laws of the State of Texas, or any other entity duly qualified and legally authorized to
serve as and perform the duties and services of paying agent and registrar for the Notes.
Section 5.03. Maintaining Paying AgentlRegistrar.
(a) At all times while any Notes are outstanding, the Town will maintain a Paying
AgentlRegistrar that is qualified under Section 5.02 of this Ordinance. The Mayor is hereby
authorized and directed to execute an agreement with the Paying AgentlRegistrar specifying the
duties and responsibilities of the Town and the Paying Agent/Registrar. The signature of the
Mayor shall be attested by the Town Secretary.
(b) If the Paying AgentlRegistrar 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 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, provided, that such tennination shall not be
effective until a successor Paying AgentlRegistrar has been appointed and has accepted the
duties of Paying Agent/Registrar for the Notes.
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Ordinance No. 2010-02 (File lD 2010-56)
Section 5.05. Notice of Change.
Promptly upon each change in the entity serving as Paying AgentlRegistrar, the Town
will cause notice of the change to be sent to each Owner and any bond insurer by first class
United States mail, postage prepaid, at the address in the Register, stating the effective date of
the change and the name and mailing address of the replacement Paying AgentlRegistrar.
Section 5.06. Agreement to Perform Duties and Functions.
By accepting the appointment as Paying AgentlRegistrar, and executing the Paying
Agent/Registrar Agreement, the Paying AgentlRegistrar is deemed to have agreed to the
provisions of this Ordinance and that it will perfonn the duties and functions of Paying
AgentlRegistrar prescribed thereby.
Section 5.07. Delivery of Records to Successor.
If a Paying AgentlRegistrar is replaced, such Paying Agent, 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 Notes to the successor Paying AgentlRegistrar.
ARTICLE VI
FORM OF THE NOTES
Section 6.01. Form Generally.
(a) The Notes, including the Registration Certificate of the Comptroller of Public
Accounts of the State of Texas, the Certificate of the Paying AgentlRegistrar, and the
Assignment form to appear on each of the Notes, (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 Notes, as evidenced
by their execution thereof.
(b) Any portion of the text of any Notes may be set forth on the reverse side thereof,
with an appropriate reference thereto on the face of the Notes.
(c) The Initial Note submitted to the Attorney General of Texas and definitive Notes,
if any, shall be typed, printed, lithographed, photocopied or engraved, and may be produced by
any combination of these methods or produced in any other similar manner, all as detelmined by
the officers executing such Notes, as evidenced by their execution thereof.
(d) The Initial Note submitted to the Attorney General of the State of Texas may be
typewritten and photocopied or otherwise reproduced.
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Ordinance No. 2010-02 (File JD 2010-56)
Section 6.02. Fonn of Notes.
The fonn of Notes, including the form of the Registration Certificate of the Comptroller
of Public Accounts of the State of Texas, the fonn of Certificate of the Paying AgentlRegistrar
and the fonn of Assignment appearing on the Notes, shall be substantially as follows:
(a) [Fonn of Note]
REGISTERED REGISTERED
No. $ ______ __
INTEREST RATE:
%
United States of America
State of Texas
TOWN OF TROPHY CLUB, TEXAS
TAX NOTE,
SERIES 2010
MATURlTY DATE: CLOSING DATE:
March 1, __ _ __ ,,2010
CUSIPNO.:
The Town of Trophy Club (the "Town") in the Counties of Tarrant, Johoson and Ellis,
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 Note shall have been sooner called for redemption and the payment of the principal
hereof shall have been paid or provision for such payment shall have been made, and to pay
interest on the unpaid principal amount hereof from the later of the Closing Date specified above
or the most recent interest payment date to which interest has been paid or provided for until
such principal amount shall have been paid or 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 I and September I of each year, commencing September I,
2010.
The principal of this Note shall be payable without exchange or collection charges in
lawful money of the United States of America upon presentation and surrender of this Note at the
corporate office in Fort Worth, Texas (the "Designated Payment/Transfer Office"), of TIB-The
Independent BankersBank, as initial Paying AgentlRegistrar, or, with respect to a successor
Paying AgentlRegistrar, at the Designated Payment/Transfer Office of such successor. So long
as the Purchaser (as defined in the Ordinance), is the Owner of record of the Notes, presentation
and surrender of any Note is not required, and payment of such principal amount to the Owner
may be by wire transfer. Interest on this Note is payable by check dated as of the interest
payment date, mailed by the Paying AgentlRegistrar to the registered owner at the address shown
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Ordinance No. 2010-02 (File lD 2010-56)
on the registration books kept by the Paying Agent/Registrar or by such other customary banking
anangements acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense
of, the person to whom interest is to be paid. For the purpose of the payment of interest on this
Note, the registered owner shall be the person in whose name this Note is registered at the close
of business on the "Record Date," which shall be the last business day of the month next
preceding such interest payment date; provided, however, that 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") will 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 Note appearing on the books of the
Paying Agent/Registrar at the close of business on the last business day preceding the date of
mailing such notice.
If a date for the payment of the principal of or interest on the Notes is a Saturday,
Sunday, legal holiday, or a day on which banking institutions in the Town in which the
Designated Payment/Transfer Office is located are authorized by law or executive order to close,
then the date for such payment shall be the next succeeding day which is not a Saturday, Slmday,
legal holiday, or day on which such banking institutions are authOlized to close; and payment on
such date shall have the same force and effect as if made on the Oliginal date payment was due.
This Note is one of a series of fiJ]]y registered notes specified in the title hereof issued in
the aggregate principal amount of $560,000 (herein refened to as the "Notes") dated as of the
Closing Date above pursuant to a cel1ain ordinance of the Town Council of the Town (the
"Ordinance") for the public purpose of providing funds for authorized public improvements for
and within the Town, and to pay the costs of issuance related to the Notes.
The Notes and the interest thereon are payable from the levy of a direct and continuing ad
valorem tax, within the limit presclibed by law, against all taxable property in the Town as
described and provided in the Ordinance.
The Notes are not subject to redemption prior to maturity.
As provided in the Ordinance, and subject to certain limitations therein set forth, this
Note is transferable upon surrender of this Note 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 Notes of
the same stated maturity, of authorized denominations, bealing the same rate of interest, and for
the same aggregate plincipal amount will be issued to the designated transferee or transferees.
Neither the Town rior the Paying Agent/Registrar shall be required to issue, transfer or
exchange any Note called for redemption where such redemption is scheduled to occur within
forty-five (45) calendar days of the transfer or exchange date; provided, however. such limitation
shall not be applicable to an exchange by the registered owner of the uncalled principal balance
of a Note.
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Ordinnnce No. 20 I 0-02 (File ID 20 10-56)
The Town, the Paying AgentiRegistrar, and any other person may treat the person in
whose name this Note 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 Note is registered
on the "Record Date" or "Special Record Date," as applicable) and for all other purposes,
whether or not this Note be overdue, and neither the Town, nor the Paying Agent/Registrar nor
any other person shall be affected by notice to the contrary.
IT IS HEREBY CERTIFIED AND RECITED that the issuance of this Note and the
series of which it is a part is duly authorized by law; that all acts, conditions and things required
to be done precedent to and in the issuance of the Notes have been properly done and performed
and have happened in regular and due time, form and manner, as required by law; and that the
total indebtedness of the Town, including the Notes, does not exceed any constitutional or
statutory limitation.
IN WITNESS WHEREOF, this Note has been duly executed on behalf of the Town,
under its official seal, in accordance with law.
Town Secretary, Town of Trophy Club, Texas ;
Mayor, Town of TrophY Club, Texas
(b) [Form of Certificate of Paying Agent/Registrar]
CERTIFICATE OF PAYING AGENTIREGISTRAR
This is one of the Notes referred to in the within mentioned Ordinance. The series of
Notes of which this Note is a part was originally issued as one Initial Note which was approved
by the Attorney General of the State of Texas and registered by the Comptroller of Public
Accounts of the State of Texas.
Dated: _______ _
Ordinance No. 20] 0-02 (File lD 2010-56)
TIB-THE INDEPENDENT BANKERSBANK
as Paying Agent/Registrar
By:
Authorized Signatory
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(c) Fonn of Assignment.
ASSIGNMENT
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 Note and all
rights hereunder and hereby irrevocably constitutes and appoints
attorney to transfer the within Note on the books kept for registration hereof, with full power of
substitution in the premises.
Dated: ___________ _
Signature Guaranteed By:
Authorized Signatory
(d) Initial Note Insertions.
NOTICE: The signature on this Assignment
must correspond with the name of the
registered owner as it appears on the face of
the within Note in every particular and must be
guaranteed in a manner acceptable to the
Paying AgentlRegistrar.
(i) The Initial Note shall be in the form set forth in paragraph (a) of this
Section, except that:
(ii) immediately under the name of the Note, the headings "INTEREST
RATE" and "MATURlTY DATE" shall both be completed with the words "As Shown
Below" and "CUSIP NO. __ " deleted;
(iii) in the first paragraph:
the words "on the Maturity Date specified above" shall be deleted and the
following will be inserted: "on February 15 in the years, in the principal
installments and bearing interest at the per annum rates set forth in the following
schedule:
Principal Installments Interest Rates
(Infonnation to be inserted from schedule in Section 3.02(b) of this Ordinance)
(iv) the Initial Note shall be numbered T-l.
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Ordinance No. 20J 0-02 (File lD 201 0-56)
(e) The following Registration Certificate of Comptroller of Public Accounts shall
appear on the Initial Note:
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER
OF PUBLIC ACCOUNTS
THE STATE OF TEXAS
§
§
§
§
REGISTER NO. ___ _
I HEREBY CERTIFY THAT there is on file and of record in my office a certificate to
the effect that the Attorney General of the State of Texas has approved this Note, and that this
Note has been registered this day by me.
WITNESS MY SIGNATURE AND SEAL OF OFFICE this ______ _
[SEAL]
Section 6.03. CUSIP Registration.
Comptroller of Public Accounts of the
State of Texas
The Town may secure identification numbers through the CUSIP Service Bureau
Division of Standard & Poor's Corporation, New York, New York, and may authorize the
printing of such numbers on the face of the Notes. It is expressly provided, however, that the
presence or absence of CUSIP numbers on the Notes shall be of no significance or effect as
regards the legality thereof and neither the Town nor the attorneys approving said Notes as to
legality are to be held responsible for CUSIP numbers incorrectly printed on the Notes.
Section 6.04. Legal Opinion.
TIle approving legal opinion of Vinson & Elkins L.L.P., Note Counsel, may be printed on
each Note over the certification of the Town Secretary of the Town, which may be executed in
facsimile.
Section 6.05. Municipal Bond Insurance.
If municipal bond guaranty insurance is obtained with respect to the Notes, the Notes,
including the Initial Note, may bear an appropriate legend, as provided by the insurer. To the
extent permitted by applicable law, the Town will comply with all notice and other applicable
requirements of the insurer in connection with the issuance of the Notes, as such requirements
may be in effect and transmitted to the Town with the insurer's commitment to issue such
JI1surance.
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Ordinance No. 2010-02 (File lD 2010-56)
ARTICLE VII
SALE OF THE NOTES;
CONTROL AND DELIVERY OF THE NOTES
Section 7.01. Sale of Notes; Official Statement.
(a) The Notes are hereby officially sold and awarded to TIB-The Independent
BankersBank (the "Purchaser") for a purchase price equal to the principal amount thereof, in
accordance with the terms of the Purchase Agreement relating to the Notes. The Purchase
Agreement, substantially in the form presented as this meeting, is hereby approved, and the
Mayor is hereby authorized and directed to execute the Purchase Agreement. It is officially
found, determined and declared that the terms of such sale are the most advantageous reasonably
obtainable by the Town. The Notes shall initially be registered in the name of the Purchaser or
its designee.
(b) All officers and officials of the Town are authorized to talee such actions and to
execute such documents, certificates and receipts, and to malee such elections with respect to the
tax-exempt status of the Notes, as they may deem necessary and appropriate in order to
consummate the delivery of the Notes. Further, in connection with the submission of the record
of proceedings for the Notes to the Attorney General of the State of Texas for examination and
approval of such Notes, 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 amomit to be the lesser of (i) III Oth of I % of the principal amount of the Notes or
(ii) $9,500).
(c) The obligation of the Purchaser identified in subsection (a) of this Section to
accept delivery of the Notes is subject to the Purchaser being furnished with the final, approving
opinion of Vinson & Elkins L.L.P., Note Counsel for the Town, which opinion shall be dated as
of and delivered on the Closing Date.
(d) The Mayor is hereby authorized and directed to execute the engagement letter
with Vinson & Elkins L.L.P., setting forth such firm's duties as Bond Counsel for the City, and
such engagement letter and the terms thereof in the form presented at this meeting are hereby
approved and accepted.
Section 7.02. Control and Delivery of Notes.
(a) The Mayor is hereby authorized to have control of the Initial Note 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 AgentlRegistrar.
-17 -
Ordinance No. 20 10-02 (File lD 20 I 0-56)
(b) After registration by the Comptroller of Public Accounts, delivery of the Notes
shall be made to the Purchaser 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 ofsale.
( c) In the event the Mayor or Town Secretary is absent or otherwise unable to execute
any document Dr take any action authorized herein, the Mayor Pro Tern and the Assistant Town
Secretary, respectively, shall be authorized to execute such documents and take such actions, and
the performance of such duties by the Mayor Pro Tern 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.
TOWil.
ARTICLE VIII
CREATION OF FUNDS AND ACCOUNTS;
DEPOSIT OF PROCEEDS; INVESTMENTS
Section 8.01. Creation of Funds.
(a) The Town hereby establishes the following special funds or accounts:
(i) The Town of Trophy Club, Texas, Tax Notes, Series 2010, Interest and
Sinking Fund; and
(ii) The Town of Trophy Club, Texas, Tax Notes, Series 2010, Project Fund.
(b) Each of said funds or accounts shall be maintained at an official depository of the
Section 8.02. Interest and Sinking Fund.
(a) The taxes levied under Section 2.01 shall be deposited to the credit of the 1nterest
and Sinking Fund at such times and in such amounts as necessary for the timely payment of the
principal of and interest on the Notes.
(b) If the amount of money in the Interest and Sinking Fund is at least equal to the
aggregate principal amount of the outstanding Notes plus the aggregate amount of interest due
and that will become due and payable on such Notes, no further deposits to that fund need be
made.
(c) Money on deposit in the Interest and Sinking Fund shall be used to pay the
principal of and interest on the Notes as such become due and payable.
Sectiori 8.03. Project Fund.
(a) Money on deposit in the Project Fnnd, including investment earnings thereof,
shall be used for the purposes specified in Section 3.01 of this Ordinance.
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Ordinance No. 2010-02 (File ID 20 1 0-56)
(b) All amounts remaining in the Project Fund after the accomplishment of the
purposes for which the Notes are hereby issued, including investment eamings of the Project
Fund, shall be deposited into the Interest and Sinking Fund.
Section 8.04. Security of Funds.
All moneys .on deposit in the funds referred to in this Ordinance shall be secured in the
manner and to the fullest extent required by the laws of the State of Texas for the security of
public funds, and moneys on deposit in such funds shall be used only for the purposes permitted
by this Ordinance.
Section 8.05. Deposit of Proceeds.
(a) All amounts received on the Closing Date shall be deposited to the Project Fund,
such moneys to be dedicated and used for the purposes specified in Section 3.01.
Section 8.06. Investments.
(a) Money in the Interest and Sinlcing Fund and the Project Fund, 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 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 8.07. Investment Income.
Interest and income derived from investment of any fund created by this Ordinance shall
be credited to such fund.
ARTICLE IX
PARTICULAR REPRESENTATIONS AND COVENANTS
Section 9.01. Payment of the Notes.
While any of the Notes 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 the interest
on and the principal of the Notes, as applicable, as will accrue or mature on each applicable
Interest Payment Date.
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 Note; the Town will
promptly payor cause to be paid the principal of, interest on, and premium, if any, with respect
to, each Note on the dates and at the places and manner prescribed in such Note; and the Town
-19 -
Ordinance No. 2010-02 (File ID 2010-56)
will, at the times and in the manner prescribed by this Ordinance, deposit or cause to be
deposited the amounts of money specified by tins Ordinance.
(b) The Town is duly authorized under the laws of the State of Texas to issue the
Notes; all action on its part for the creation and issuance of the Notes has been duly and
effectively taken; and the Notes 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 Notes shall be excludable from gross income
for purposes of federal income taxation pursuant to sections 103 and 141 through 150 of the
Internal Revenue Code of 1986, as amended (tile "Code"), and the applicable regulations
promulgated thereunder the ("Regulations"). The Town covenants and agrees not to tal(e any
action, or lmowingly omit to tal(e any action within its control, that if tal(en or omitted,
respectively, would cause the interest on tile Notes to be includable in the gross income, as
defined in section 61 of the Code, of the holders iliereof for purposes of federal income taxation.
In particular, ilie Town covenants and agrees to comply with each requirement of Sections 9.03
through 9.1 0 of tIlls Article IX; provided, however, that the Town shall not be required to
comply wiili any particular requirement of Sections 9.03 through 9.10 of tIlls Article IX if ilie
Town has received an opinion of nationally recognized bond counsel ("Counsel's Opinion") iliat
such noncompliance will not adversely affect ilie exclusion from gross income for federal
income tax purposes of interest on the Notes or ifilie Town has received a Counsel's Opinion to
the effect iliat compliance with some other requirement set forili in Sections 9.03 through 9.10 of
tIlls Article IX will satisfy the applicable requirements of the Code, in which case compliance
with such other requirement specified in such Counsel's Opinion shall constitute compliance
with ilie corresponding requirement specified in Sections 9.03 through 9.10 of tIlls Article IX.
Section 9.04. No Private Use or Payment and No Private Loan Financing.
The Town shall certify, through an auiliorized officer, employee or agent, tImt, based
upon all facts and estimates known or reasonably expected to be in existence on ilie date ilie
Notes are delivered, ilie proceeds of ilie Notes will not be used in a manner iliat would cause ilie
Notes to be "private activity bonds" witIlin ilie meaning of section 141 of ilie Code and tile
Regulations. The Town covenants and agrees that it will make such use of ilie proceeds of the
Notes including interest or other investment income derived from Note proceeds, regulate tile use
of property financed, directly or indirectly, with such proceeds, and take such oilier and further
action as may be required so tIlat the notes will not be "private activity bonds" within ilie
meaning of section 141 ofilie Code and ilie Regulations.
Section 9.05. No Federal Guaranty.
The Town covenants and agrees not to take any action, or knowingly omit to take any
action wiiliin its control, tllat, if taken or omitted, respectively, would cause the Notes to be
"federally guaranteed" within the meaning of section 149(b) of the Code and tile Regulations,
except as permitted by section 149(b)(3) of the Code and tile Regulations.
-20-
Ordinance No. 2010-02 (File lD 201 0-56)
Section 9.06. Notes are not Hedge Bonds.
The Town covenants and agrees not to take any action, or Imowingly omit to take any
action, and has not Imowingly omitted and will not Imowingly omit to take any action, within its
control, that, if taken or omitted, respectively, would cause the Notes 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 Imown or reasonably expected to be in existence on the date the
Notes are delivered, the Town will reasonably expect that the proceeds of the Notes will not be
used in a manner that would cause the Notes to be "arbitrage bonds" within the meaning of
section 14B(a) of the Code and the Regulations. Moreover, the Town covenants and agrees that
it will make such use of the proceeds of the Notes including interest or other investment income
derived from Note proceeds, regulate investments of proceeds of the Notes and take such other
and further action as may be required so that the Notes will not be "arbitrage bonds" within the
meaning of section 14B(a) of the Code and the Regulations.
Section 9.0B. Arbitrage Rebate.
If the Town does not qualifY for an exception to the requirements of Section 148(f) of the
Code, the Town will talee all necessary steps to comply with the requirement that certain amounts
earned by the Town on the investment of the "gross proceeds" of the Notes (within the meaning'
of section 14B(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 of the Notes as
may be required to calculate the amount earned on the investment of the gross proceeds of the
Notes separately from records of amounts on deposit in the funds and accounts of the Town
allocable to other bond issue of the Town or moneys which do not represent gross proceeds of
any bonds 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 Notes 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 Notes or on such other dates as may be permitted under the Regulations, all
amowlts 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 ofthe Notes 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 Notes are issued, an information statement concerning the Notes, all under
and in accordance with section 149(e) of the Code and the Regulations.
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Ordinance No, 20 I 0-02 (File lD 20 I 0-56)
Section 9.10. Oualified Tax-Exempt Obligations.
The Town hereby designates the Notes 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 2010,
including the Notes, which have been designated as "qualified tax-exempt obligations" under
section 265(b)(3) of the Code does not exceed $30,000,000, and (b) that the reasonably
anticipated amount of its tax-exempt obligations which will be issued by the Town during
calendar year 2008, including the Notes, will not exceed $30,000,000. For purposes of this
Section 9.1 0, 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 9.10, the Town
includes all governmental units which are aggregate with the Town under section 265(b) of the
Code.
Section 9.11. Continuing Obligation.
Notwithstanding any other provision of this Ordinance, the Town's obligations under the
covenants and provisions of Sections 9.03 through 9.10 of this Article IX shall survive the
defeasance and discharge of the Notes.
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," to-wit:
(i) the failure to make payment of the principal of, redemption premium, if
any, or interest on any of the Notes 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, the failure to perform which materially, 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
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 and in every case 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
-22-
Ordinance No. 2010·02 (File ID 2010-56)
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 Notes then outstanding.
Section 10.03. Remedies Not Exclusive.
(a) No remedy herein conferred or reserved is intended to be exclusive of any other
available remedy or remedies, but each and every such remedy shall be cumulative and shall be
in addition to every other remedy given hereunder or under the Notes or now or hereafter
existing at law or in equity; provided, however, that notwithstanding any other provision of this
Ordinance, the right to accelerate the debt evidenced by the Notes shall not be available as a
remedy under this Ordinance.
(b) The exercise of any remedy herein conferred or reserved shall not be deemed a
waiver of any other available remedy.
ARTICLE Xl
DISCHARGE
Section 11.0 I. Discharge.
The Town reserves the right to defease, discharge or refund the Notes in any manner
permitted by applicable law.
ARTICLEXll
EFFECTIVE IMMEDlATEL Y
Section 12.0 I. Effectiveness.
This Ordinance shall become effective immediately upon its adoption at this meeting
pursuant to Section 120 1.028, Texas Government Code.
·23 .
Ordinance No. 20]0·02 (File lD 20]0·56)
APPROVED this 1st day of February 2010.
J Mayor, Town of Trophy Club, Texas
ATTEST:
Town Secretary, Town of Trophy Club, Texas
APPROVED AS TO FORM AND LEGALITY:
Town Attorney, Town of Trophy Club, Texas
-24-
Vinson&Elkins
February 1, 2010
Honorable Mayor and Town Council
Town of Trophy Club, Texas
100 Municipal Drive
Trophy Club, TX 76262
Ladies and Gentlemen:
We appreciate being asked to represent the Town of Trophy Club, Texas (the
"Town"), as bond counsel in connection with the issuance of its Town of Trophy Club, Texas
Tax Notes, Series 2010 (the "Notes"). Our experience has been that it is mutually beneficial
to set forth, at the outset of our representation, the role and responsibilities of both our law
firm and the client. That is the purpose of both this letter and the separate Standard Terms of
Engagement for Legal Services that is enclosed with this letter.
The client for this engagement is the Town of Trophy Club, Texas. This engagement
does not create an attorney-client relationship with any related persons or entities, such as
employees, officers, individual officials or sponsored entities.
Scope of Engagement
This engagement will include only the matters described in the following paragraphs
and any additional matters that are made part of the engagement by written supplement to
this letter.
As your bond counsel we will:
(1) examine applicable law;
(2) prepare (i) the ordinance pursuant to which the Notes will be issued and
secured (collectively, the "Ordinance"), (ii) such other documents as may be required by any
financing or which we deem necessary for rendering our opinion, and (iii) the forms of such
closing documents, certificates, and opinions of counsel as may be required by the terms of
the financing and applicable federal and state laws;
Vinson & Elkins LLP Attorneys at Law
Abu Dhabi Austin Beijing Dallas Dubal Hong Kong Houston
london Moscow New York Shanghai Tokyo Washington
Trammell Crow Center, 2001 Ross Avenue, Suite 3700
Dallas, TX 75201-2975
Tel +1.214.220.7700 Fax +1 .214.220.7716 WWVI/.velaw.com
V&E February 1, 2010 Page 2
consult with the parties prior to the issuance of the Notes; and (3)
(4) review certified proceedings relating to the issuance of the Notes.
Anticipated Opinions
Subject to the completion of proceedings to our satisfaction, we anticipate that we
will render our standard principal opinion regarding the validity of the Notes under Texas
law and regard the tax-exempt status of the interest on the Notes under federal taw law, if
appropriate.
Such opinion will be executed and delivered by us in written form on the date any
Notes are exchanged for their purchase price (the "Closing") and will be based on facts and
law existing as of their date. Upon delivery of the opinion, our responsibilities as bond
counsel will be concluded with respect to this financing; specifically, but without implied
limitation, we do not undertake (unless separately engaged) to provide continuing advice to
the Town concerning any actions with respect to the Town's obligations under Rule 15c2-12
of the United States Securities and Exchange Commission.
In rendering the opinion, we will rely upon representations of the Town set forth in
the financing documents, the certified proceedings, and other certifications of public officials
and other persons (including certifications as to the use of proceeds of the Notes and various
tax matters) without undertaking to verifY the same by independent investigation.
We do not review the financial condition of the Town or the adequacy of the security
provided to owners of the Notes, and we will express no opinion relating thereto.
Statement Respecting Advocacy.
In performing our services as bond counsel, our client will be the Town and we will
represent its interests. We assume that you and other parties to the transaction will retain
such counsel as you and they deem necessary and appropriate to represent your and their
interests in tins transaction. Our representation of the Town does not alter our responsibility
to render an objective opinion as bond counsel.
Limitation Respecting Disclosure.
As bond counsel, we will not assume or undertake responsibility for the preparation
of an Official Statement or any other disclosure document with respect to any Notes, nor are
we responsible for performing an independent investigation to determine the accuracy,
V&E February 1. 2010 Page 3
completeness or sufficiency of any such document. In any public offering of the Notes, we
would expect both the underwriters and the Town to evidence compliance with the current
standards for full disclosure by the delivery at Closing of appropriate officers' certificates
and opinions of counsel relating to both the undertakings of the Town and the accuracy and
completeness of the information included in the Official Statement. Moreover, if a
disclosure document will be adopted or approved by the Town, our responsibility will
include the preparation or review of any description or summary therein of: (i) federal and
state law pertinent to the validity of the Notes and the tax treatment of interest paid thereon
(ii) the Note Ordinance and the Notes, and (iii) our opinion.
We understand and agree that this is not an exclusive agreement, and you are free to
retain any other counsel of your choosing. We recognize that we shall be disqualified from
representing any other client (i) in any matter which is substantially related to our
representation of you and (ii) with respect to any matter where there is a reasonable
probability that confidential information you furnished to us could be used to your
disadvantage. You understand and agree that, with those exceptions, we are free to represent
other clients, including clients whose interests may conflict with yours in litigation, business
transactions, or other legal matters. You agree that our representing you in this matter will
not prevent or disqualifY us from representing clients adverse to you in other matters and that
you consent in advance to our undertaking such adverse representations.
Our firm represents from time to time a number of financial institutions, including
institutions that act as financial advisors or underwriters in connection with the issuance of
municipal bonds. This means that we may have represented, may currently represent, or in
the future may represent financial institutions tlmt have interests opposing your interests in
connection with the Notes. This will not in any way affect the diligence or vigor with which
we represent your interests in connection Witll the issuance of the Notes. If this is a concern
to you, please let us know and we will check on the particular financial institutions involved
in tile issuance and underwriting of the Notes.
Our firm represents a number of lawyers and law firms in professional liability,
business, tax and other matters. This means that we may have represented, may currently
represent, or in the future may represent counsel opposing your interests in a matter in which
we represent you. This will not in any way affect the diligence or vigor with which we
represent your interests in the matter or the matters on which you engage our firm. If this is a
concern to you, please let us know and we will check on the particular lawyers involved in
your matter or matters.
V&Z February 1,2010 Page 4
This engagement and our attorney-client relationship will be terminated when we
have completed the services in the matters covered by this engagement letter and any written
supplements to this engagement letter. If you later retain us to perform further or additional
services, our attorney-client relationship will be established by another engagement letter.
Cooperation
In order to enable us to render effectively the legal services contemplated, you have
agreed to disclose fully and accurately all facts and keep us informed of all developments
relating to this matter. We necessarily must rely on the accuracy and completeness of the
facts and information you and your agents provide to us. To the extent it is necessary for
your representatives to attend meetings in connection with this matter, we will attempt to
schedule them so that the convenience of those representatives can be served.
Our fees for services to be rendered in this matter will be as set forth on Schedule I.
Our fees for service with respect to the issuance of the Notes will be contingent upon the
issuance of the Notes. If, for any reason, we are not able to render our anticipated opinion as
bond counsel with respect to the issuance of the Notes, we will withdraw as bond counsel
and we would not expect to be compensated for our legal services or expenses unless conduct
by the Issuer is the cause of our inability to render our opinion.
Other Charges
In addition to our fees, there will be other charges for items incident to the
performance of our legal services, such as photocopying, messengers, travel expenses, long-
distance telephone calls, facsimile transmissions, postage, overtime for secretaries and other
nonlegal staff, specialized computer applications such as computerized legal research, and
filing fees. The basis upon which we establish these other charges is set forth in the Standard
Terms of Engagement For Legal Services.
Investment Disclosures
Many of the Firm's lawyers, directly or beneficially, own interests in corporations
and other entities or in real property. Although our computerized system used for checking
conflicts of interest tracks all investments made in the name of the Firm, it does not contain
data as to investments made individually by each of the Firm's lawyers. If you are at all
concerned about these individual investments, we will be pleased to canvass our lawyers
V&£ February 1, 2010 Page 5
about their individual investments ill any entity or entities about which you may be
concerned.
Withdrawal or Termination
Our relationship is based upon mutual consent and you may terminate our
representation at any time, with or without cause, by notifying us. Your termination of our
services will not affect your responsibility for payment of fees for legal services rendered and
of other charges incurred before termination and in connection with an orderly transition of
the matter.
We are subject to the rules of professional conduct for the jurisdictions in which we
practice, which list several types of conduct or circumstances that require or allow us to
withdraw from representing a client, including for example, nonpayment of fees or costs,
misrepresentation or failure to disclose material facts, fundamental disagreements, and
conflict of interest with another client. We try to ident:ifY in advance and discuss with our
client any situation which may lead to our withdrawal, and if withdrawal ever becomes
necessary, we give the client written notice of our withdrawal. If we elect to withdraw for
any reason, you will take all steps necessary to free us of any obligation to perform further,
including the execution of any documents necessary to complete our withdrawal, and we will
be entitled to be paid for all services rendered and other charges accrued on your behalf to
the date of withdrawal.
If the foregoing, including the items set forth in the enclosed Standard T=s of
Engagement For Legal Services, correctly reflects your understanding of the terms and
conditions of our representation, please so indicate by executing the enclosed copy of this
letter in the space provided below and return it to the undersigned.
V<Zr-E February 1, 2010 Page 6
Please contact the undersigned if you have any questions. We are pleased to have tlns
opportunity to be of service and to work with you.
Sincerely,
VINSON & ELIGNS L.L.P.
B,.A~~
Enclosure
AGREED TO AND ACCEPTED:
TOWN OF TROPHY CLUB, TEXAS
~_ c.-----
BY:. __ ~~L-~~~~ ________________ _
Town Manager
SCHEDULEr
Tax Notes: Hourly rates not exceeding a total of $6,500 (plus expenses -see below).
Additional Charges:
Our schedule of additional charges is included in the Standard Tenns of Engagement for Legal
Services attached to this letter.
VINSON & ELKINS L.L.P.
Standard Tel7ns of Engagement
for Legal Services
This statement sets forth certain standard tenns of our engagement as your lawyers and is
intended as a supplement to the engagement letter that we have with you as our client. Unless
modified in writing by mutual agreement, these tenns will be an integral part of our agreement
with you as reflected in the engagement letter. Therefore, we ask that you review this statement
carefully and contact us promptly if you have any questions. We suggest that you retain this
statement in your file with the engagement letter.
The Scope of Our Work
You should have a clear understanding of the legal services we will provide. Any
questions that you have should be dealt with promptly.
We will at all times act on your behalf to the best of our ability. Any expressions on our
part concerning the outcome of your legal matters are expressions of our best professional
judgment, but are not guarantees. Such opinions are necessarily limited by our knowledge of the
facts and are based on the state of the law at the time they are expressed.
It is our policy that the person or entity that we represent is the person or entity that is
identified in our engagement letter, and absent an express agreement to the contrary does not
include any affiliates of such person or entity (e.g., if you are a corporation or partnership, any
parents, subsidiaries, employees, officers, directors, shareholders or partners of the corporation
or partnership, or commonly owned corporations or partnerships; or, if you are a trade
association, any members of the trade association). If you believe this engagement includes
additional entities or persons as our clients you should infonn us inunediately.
It is also our policy that the attorney-client relationship will be considered terminated
upon our completion of any services t11at you have retained us to perfonn. If you later retain us
to perfonn further or additional services, our attorney-client relationship will be revived subject
to the tenns of engagement t11at we agree on at that time.
This engagement shall be subject to the Texas Disciplinary Rules of Professional
Conduct.
Who Will Provide the Legal Services
Customarily, each client of the Finn is served by a principal attorney contact. The
principal attorney should be someone in whom you have confidence and with whom you enjoy
working. You are free to request a change of principal attorney at any time. Subject to the
supervisory role of tile principal attorney, your work or parts of it may be perfonned by other
lawyers and non-lawyers in the Finn. Such delegation may be for the purpose of involving
lawyers or non-lawyers with special expertise in a given area or for the purpose of providing
V&..,-£
services on the most efficient and timely basis. Whenever practicable, we will advise you of the
names of those attorneys and non-lawyers who work on your matters.
How Our Fees Will Be Set
Generally, our fees are based on the time spent by the lawyers and non-lawyers who work
on the matter. We will charge for all time spent in representing your interests, including, by way
of illustration, telephone and office conferences with you and your representatives, consultants
(if any), opposing counsel, and others; conferences among our legal and non-lawyer personnel;
factual investigation; legal research; responding to your requests for us to provide information to
your auditors in connection with reviews or audits of financial statements; drafting letters and
other documents; and travel. We will keep accurate records of the time we devote to your work
in units of quarters of an hour.
The hourly rates of our lawyers and non-lawyers are, from time to time, reviewed and
adjusted and may be changed with or without notice to reflect current levels oflegal experience,
changes in overhead costs, and other factors. London rates are set in UK pounds sterling and are
converted to dollars using the official exchange rate established by the UK government at the
beginning of the calendar quarter in which the time was worked.
Although we may from time to time, at the client's request, furnish estimates oflegal fees
and other charges that we anticipate will be incurred, these estimates are by their nature inexact
(due to unforeseeable circumstances) and, therefore, the actual fees and charges ultimately billed
may vary from such estimates.
With your advance agreement, the fees ultimately charged may be based upon a number
of factors, such as:
The time and effort required, the novelty and complexity of the issues presented,
and the skill required to perform the legal services promptly;
The fees customarily charged in the community for similar services and the value
of the services to you;
The amount of money or value of property involved and the results obtained;
The time constraints imposed by you as our client and other circumstances, such
as an emergency closing, the need for injunctive relief from court, or substantial
disruption of other office business;
The nature and longevity of our professional relationship with you;
The experience, reputation and expertise of the lawyers performing the services;
The extent to which office procedures and systems have produced a high-quality
product efficiently.
- 2 -
V&E
For certain well-defined services (for example, a simple business incorporation), we will
(if requested) quote a flat fee. It is our policy not to accept representation on a flat-fee basis
except in such defined-service areas or pursuant to a special arrangement tailored to the needs of
a particular client. In all such situations, the flat fee arrangement will be expressed in a letter,
setting forth both the amount of the fee and the scope of the services to be provided.
We also will, in appropriate circumstances, provide legal services on a contingent fee
basis. Any contingent fee representation must be the subject of a separate and specific
engagement letter.
Additional Charges
In addition to our fees, there will be other charges for items incident to the performance
of our legal services, such as reprographics, couriers, travel expenses, some long distance
telephone calls, facsimile transmissions, postage, overtime for secretaries and other non-legal
staff, specialized computer applications such as computerized legal research, media services and
practice support, records retrieval, and filing fees. The current basis for these charges in the
Firm's U.S. offices is set forth below. Charges for similar services in the Firm's foreign offices
may vary from those shown below. The Firm will review this schedule of charges periodically
and adjust them to take into account changes in the Firm's costs and other factors.
Reprographics and Production Services
The Firm charges $.15 per page for non-color duplicating and scanning, including
printing electronic and scanned images, and printing for duplication purposes.
There are special charges for other production services, which are available on
request.
Courier Services
Charges, which may vary based on the service provider used and the service
provided, are billed at the Firm's actual cost.
Computer Aided Legal Research (CALR)
Charges for services are billed at the Firm's actual cost.
Telefax
The Firm charges $0.25 per page for outgoing telefaxes, which includes all
telephone costs. There is no charge for incoming faxes.
Telephone
The Firm does not charge for local or domestic long distance calls originating in
the Firm's U.S. offices. Other long distance calls, including international long
distance calls, audio conferencing services, and calling card calls are charged at
the Firm's actual cost for the call or conference.
- 3 -
Travel-Related Expenses
Airfare, hotel, meals, ground transportation and otller travel related costs are
billed at ilie Finn's actual costs, including negotiated discounts. Airfare charges
include a $35 charge per airline transaction (excluding cancellations) paid by ilie
Finn to its travel agent (except for Southwest Airlines, where ilie charge is $15
per transaction).
All Other Costs
The Finn charges actual disbursements for fuird-party services such as court
reporters, expert witnesses, etc., and may recoup expenses reasonably incurred in
conoection wiili services perfonned in-house, such as postage, non-legal staff
overtin1e, file retrieval, media services and practice support, etc. A current
schedul e of iliese charges is available on request.
Unless special arrangements are oilierwise made, fees and expenses of oiliers (such as
experts, investigators, consultants and court reporters) will be ilie responsibility of, and billed
directly to, ilie client. Further, all invoices in excess of $500 will be forwarded to ilie client for
direct payment.
Billing Arrangements and Terms
Our billing rates are based on ilie assumption of prompt payment. Consequently, unless
oilier arrangements are made, fees for services and oilier charges will be billed monthly and are
payable within fuirty days of receipt.
By engaging us, you acknowledge and agree iliat you are responsible for payment of fees,
expenses and disbursements. In appropriate matters as an accommodation to you, we may agree
to direct our bills to third-party payors (e.g., an insurer), but you agree iliat you will remain fully
responsible for timely payment of our bills if for any reason ilie fuird party does not timely pay
such bills. Likewise, we agree iliat we owe our professional obligations to you, even when a
fuird party pays our bills.
Advances
Clients of fue Firm are sometimes asked to deposit funds as an advance payment wiili ilie
Finn. The advance payment will be applied first to payment of charges for such items as
photocopying, messengers, travel, etc., as more fully described above, and tllen to fees for
services. The advance will be deposited in our client advance account and we will charge such
oilier charges and our fees against fue advance and credit fuem on our billing statements. In ilie
event such oilier charges and our fees for services exceed ilie advance deposited wifu us, we will
bill you for tlle excess monilily or may request additional advances. Any unused portion of
amounts advanced will be refundable at ilie conclusion of our representation.
-4-
Confidentiality
We will preserve the confidentiality of information you provide us consistent with
applicable law including the rules of professional conduct governing lawyers. This confirms
your agreement that, with respect to firm brochures or other material or information regarding
the firm and its practice, we may indicate the general nature of our representation of you and
your identity as a firm client.
Client and Firm Documents
We will maintain any documents that you furnish to us in our client file (or files) for this
matter. At your request, we will return your documents to you at the conclusion ofthe matter (or
earlier, if appropriate). It is your obligation to tell us which, if any, of the documents that you
furnish us that you want returned. We will return those documents to you promptly after our
receipt of payment for outstanding fees and charges. Our own files pertaining to this matter,
including the work performed by our attorneys, will be retained by the Firm. Any documents
retained by the firm will be kept for a certain period of time, and ultimately we will destroy them
in accordance with our record retention program schedule then in effect.
Third Party Contractors
Like many law firms and other organizations, our Firm from time to time uses or deals
with third parties in connection with certain areas of our practice or operations. For instance,
these third parties may include vendors, consultants, advisors, or other service providers in areas
such as litigation support, storage, document management, hardware and software systems, law
firm practice management, information teclmology, accounting and financial matters, and the
like. Additionally, the Firm may use temporary lawyers and non-lawyers in certain matters. In
performing their services, these parties may have some access to confidential client information,
and the Firm accordingly has appropriate confidentiality arrangements with them obligating
them to preserve the confidentiality of any such information. You consent to the Firm allowing
non-employee contractors access to such information as described. We take our confidentiality
obligations very seriously; do not hesitate to contact us with any questions.
- 5 -
GENERAL AND NO-LITIGATION CERTIFICATE
We, the undersigned, authorized officers of the Town of Trophy Club, Texas
(the "Town"), do hereby certifY the following information:
1. General
1.1. This certificate relates to the Town of Trophy Club, Texas, Tax Notes, Series 2010
(the "Notes"), dated February 25, 2010, in the authorized aggregate principal amount of
$560,000. The capitalized terms used herein and not otherwise defined shall have the meanings
assigned to them in the ordinance authorizing the issuance of the Notes (the "Ordinance").
1.2. The Town is a duly incorporated Home Rule City that is operating and existing
under the Constitution and laws of the State of Texas and the duly adopted Home Rule Charter
of the Town which charter was last amended on November 2,2004.
1.3. The following are duly qualified and acting, elected or appointed officials of the
Town of Trophy Club, Texas:
Connie White, Mayor Glenn Strother
Susan Edstrom
Bill Rose
Philip Sterling
Kathleen Wilson
Brandon Emmons, Town Manager
Lisa Hennek, Town Secretary
Patricia Adams, Town Attorney
)
) Members of
) the Council
)
)
1.4. The total principal amount of the presently outstanding indebtedness of the Town
payable from ad valorem taxes, after giving effect to the issuance of the Notes is $8,722,000.
1.5. According to the tax rolls of the Town for the tax year 2009, which are the latest
approved tax rolls of the Town, the total assessed value of real property and personal property,
net of exemptions and subject to taxation by the Town is $668,728,455.
1.6. The Town is not in default in the payment of principal or interest on any of its
outstanding obligations.
1. 7. Neither the corporate existence nor boundaries of the Town nor the title of its
present officers to their respective offices is being contested, and no authority or proceedings for
the issuance of the Notes have been repealed, revoked, or rescinded.
1.8. Attached hereto as Exhibit A is a true and correct copy of the debt service schedule
for the Notes and all other outstanding indebtedness of the Town payable from ad valorem taxes
levied.
II. Signature Identification and No Litigation
2.1. We officially executed and signed the Notes, including the initial Note delivered to
the purchaser of the Notes (the "Initial Note"), by manual signature or by causing facsimiles of
our manual signatures to be imprinted or lithographed on each of the Notes, and we hereby adopt
said facsimile signatures as our own, respectively, and declare that said facsimile signatures
constitute our signatures the same as if we had manually signed each of the Notes; at the time we
so executed and signed the Notes we were, and at the time of executing this certificate we are,
the duly chosen, qualified, and acting officers indicated therein and authorized to execute the
same; and we have caused the official seal of the Town to be impressed, printed, or lithographed
on each of the Notes, and said seal on the Notes has been duly adopted as, and is hereby declared
to be, the official seal of the Town.
2.2. The Notes, including the Initial Note, are substantially in the form, and have been
duly executed and signed in the manner prescribed in the Ordinance.
2.3. No litigation is pending or, to our knowledge, threatened in any court: (i) to restrain
or enjoin the issuance or delivery of the Notes, the levy or the collection of the ad valorem taxes
to pay the principal of and interest on the Notes (ii) contesting or affecting in any way the
creation, organization, existence or powers of the Town or the authority of the Town Council to
adopt the Ordinance and to authorize the execution and delivery of the Notes; or (iii) contesting
or affecting in any way the validity or authorization of the Notes or the Ordinance relating to the
Notes.
III. Approval
3.1. The Attorney General of Texas is hereby authorized and directed to date this
certificate concurrently with the date of approval of the Notes, and can rely on the absence of any
litigation or contest pertaining to the Notes or any other matters covered by this certificate, and
on the veracity and currency of this certificate at the time of approval of the Notes, unless
otherwise notified.
[Execution Page Follows]
-2-
US 237469v.1
EXECUTED AND DELIVERED ON ________ .
Manual Signatures Official Titles
Mayor
Town Secretary
7
Town Manager
STATE OF TEXAS §
§
COUNTY OF DENTON §
Before me, the undersigned authority, on tllls day personally appeared Connie White,
Mayor of the Town of Trophy Club, Texas, known to me to be the person who signed the above
and acknowledged to me that such person executed tlle above and foregoing Certificate in my
presence and for the purposes stated therein.
Given under my hand and seal of office this dod e/2:.eh./U.-i (1/17 ZlJ1iJ
d(Q (} s/Jer)/)L
Notary Public, State of Texas
General and No-Litigation Certificate
STATE OF TEXAS §
§
COUNTY OF DENTON §
Before me, the undersigned authority, on this day personally appeared Lisa Hennek,
Town Secretary of the Town of Trophy Club, Texas, known to me to be the person who signed
the above and acknowledged to me that such person executed the above and foregoing
Certificate in my presence and for the purposes stated therein.
Given under my hand and seal of office this -LFt""hl..!.'-'rt"".llli""'-'44-'!J",-,-" d""O!dJI"'{j'----____ .
otary Public, State of Texas
STATE OF TEXAS §
§
COUNTY OF DENTON §
Before me, the undersigned authority, on this day personally appeared Brandon Emmons,
Town Manager of the Town of Trophy Club, Texas, known to me to be the person who signed
the above and acknowledged to me that such person executed the above and foregoing
Certificate in my presence and for the purposes stated therein.
Given under my hand and seal of office this ZrJd !cbdVC'.-'77 2tJ /7J
&(0 a cI-J,/) /7 eA
Notary Public, State of Texas
General and No-Litigation Certificate
EXHIBIT A
[See Attached]
Fiscal Year
30-Sep
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
$
TOWN OF TROPHY CLUB, TEXAS
GENERAL OBLIGATION DEBT SERVICE REQUIREMENTS
(Following the Issuance of the Series 2010 Tax Notes)
Currently
Outstanding The Tax Notes
Debt Service Princi~al Interest Total
903,214.00 $ c $ 10,013.25 $ 10,013.25
897,188.50 95,000.00 18,848.50 113,848.50
899,026.00 100,000.00 16,200.50 116,200.50
899,314.50 100,000.00 13,065.50 113,065.50
892,546.50 80,000.00 9,908.50 89,908.50
695,449.00 85,000.00 6,635.75 91,635.75
692,627.50 50,000.00 3,680.00 53,680.00
693,979.50 50,000.00 1,252.50 51,252.50
646,277.50
640,537.50
643,557.50
639,927.50
645,305.00
289,082.50
291,215.00
250,745.00
256,120.00
255,780.00
$11,131,893.00 $ 560,000.00 $ 79,604.50 $ 639,604.50
Combined
Debt Service
$ 913,227.25
1,011,037.00
1,015,226.50
1,012,380.00
982,455.00
787,084.75
746,307.50
745,232.00
646,277.50
640,537.50
643,557.50
639,927.50
645,305.00
289,082.50
291,215.00
250,745.00
256,120.00
255,780.00
$ 11,771,497.50
EXECUTED AND DELNERED ON ________ ,
Manual Signatures Official Titles
Mayor
Town Secretary
Town Manager
Director of Finance
STATE OF TEXAS §
§
COUNTY OF DENTON §
Before me, the undersigned authority, on this day personally appeared Connie White,
Mayor of the Town of Trophy Club, Texas, Imown to me to be the person who signed the above
and acknowledged to me that such person executed the above and foregoing Certificate in my
presence and for the purposes stated therein.
Given under my hand and seal of office this ?ad ¥M/lv0Jl?7 lrJ/r)
~~ jJ/2/Jfo!
Notary Public, State of Texas
General and No-Litigation Certificate
STATE OF TEXAS §
§
COUNTY OF DENTON §
Before me, the undersigned authority, on this day personally appeared Kathy DuBose,
Director of Finance of the Town of Trophy Club, Texas, lmown to me to be the person who
signed the above and aclmowledged to me that such person executed the above and foregoing
Certificate in my presence and for the purposes stated therein.
Given under my hand and seal of office this 217 / cI!t:Mu c:vJ/ J,o/v
Notary Public, State of Texas
[NOTARY SEAL)
General and No-Litigation Certificate
MINUTES AND CERTIFICATION PERTAINING TO
PASSAGE OF AN ORDINANCE
On February 1, 2010, the Town Council ofthe Town of Trophy Club, Texas, convened in
a regular meeting at the regular meeting place thereof in the Town Hall, 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 Govenunent 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 Susan Edstrom
Bill Rose
)
)
)
)
Glenn Strother, Mayor Pro Tern Members of
the Council Philip Sterling
Kathleen Wilson
and all of said persons were present except , thus
. constituting a quorum. Whereupon, among other business, a written ordinance bearing the
following caption was introduced:
AN ORDINANCE OF THE TOWN OF TROPHY CLUB,
TEXAS, AUTHORIZING THE ISSUANCE AND SALE OF
TOWN OF TROPHY CLUB, TEXAS, TAX NOTES, SERIES
2010, IN THE AGGREGATE PRINCIPAL AMOUNT OF
$560,000; APPROVING A NOTE PURCHASE AGREEMENT
AND ENGAGEMENT LETTER; LEVYING A TAX IN
PAYMENT THEREOF; PRESCRIBING THE FORM OF SAID
NOTES; AND ENACTING OTHER PROVISIONS RELATING
TO THE SUBJECT
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:
NAYS:
ABSTENTIONS:
US 240497v.1
MINUTES APPROVED AND 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 corr~t
copy of an official copy thereof on file among the official records of the Town, all on Hus E of
February, 2010.
./ Town Secretary, Town of Trophy Club, Texas
[SEAL]
Minutes and Certification for Ordinance Authorizing Tax Notes
APPROVED this 1 st day of February 2010.
/
Mayor, Town of Trophy Club, Texas
ATTEST:
Town Secretary, Town of Trophy Club, Texas
APPROVED AS TO FORM AND LEGALITY:
Town Attorney, Town of Trophy Club, Texas
-24-
Town of Trophy Club, Texas
100 Municipal Drive
Trophy Club, Texas 76262
PURCHASE AGREEMENT
February 1, 2010
Re: $560,000 Town of Trophy Club, Texas, Tax Notes, Series 2010
Dear Honorable Mayor and Town Councilmembers:
We hereby offer to purchase from the Town of Trophy Club, Texas (the "Town") the
captioned Notes (the "Notes") and, upon acceptance of this offer by the Town, such offer will
become a binding agreement between the undersigned and the Town. This offer must be
accepted by 10:00 p.m., Texas time, February 1, 2010, and if not so accepted will be subject to
withdrawal.
1. Purchase Price. The purchase price for the Notes shall be $560,000.
2. Terms of Notes. The Notes shall be issued in the principal amount of $560,000
and shall bear interest at such rates, mature on such dates and in such amounts,
and have such other terms and conditions as are set forth in the Ordinance (the
"Ordinance") to be adopted by the Town Council of ~e Town on February 1,
2010, a copy of which has been provided to us. Pursuant to and as more fully
described in the Ordinance, the Notes shall be secured by a pledge of ad valorem
taxes to be levied on all taxable property within the Town within the limits
prescribed by law.
3. Closing. The Town shall deliver the Notes to, or for the account of, the
undersigned and the undersigned shall purchase the Notes at 10:00 a.m., Texas
time, on February 25, 2010 or at such other time as shall be mutually agreed upon
(hereinafter referred to as the "Closing"). The Closing shall take place at the
offices of Vinson & Elkins L.L.P., Dallas, Texas, or such other location as may be
mutually agreed upon.
4. Conditions to Closing. The undersigned shall have no obligation to consummate
the purchase of the Notes unless the following requirements shall have been
satisfied prior to Closing:
241997v.2 TR020017 1000
Honorable Mayor and Town Councilmember
February 1,2010
(a) The Town Council shall have adopted the Ordinance authorizing the
issuance of the Notes.
(b) Vinson & Elkins L.L.P. shall have issued its approving legal opinion as to
the due authorization, issuance and delivery of the Notes and as to the
exemption of interest thereon from federal income taxation.
(c) The Notes shall have been approved by the Attorney General of the State
of Texas and shall have been registered by the Comptroller of Public
Accounts ofthe State of Texas.
5. Nature of Purchase. The undersigned and the Town acknowledge that no official
statement or other disclosure or offering document has been prepared in
connection with the issuance and sale of the Notes. The undersigned represents
that it is a knowledgeable and sophisticated purchaser with experience in
purchasing municipal securities such as the Notes. The undersigned is familiar
with the financial condition and affairs of the Town, particularly with respect to
its ability to pay its tax supported obligations such as the Notes. The undersigned
has received from the Town all information that it has requested in order for it to
assess and evaluate the security and source of payment for the Notes. The
undersigned is purchasing the Notes for its own account as evidence of a privately
placed and negotiated bank loan or on behalf of other sopmsticated purchasers
and has no present intention to make a public distribution or sale of the Notes. In
no event will the undersigned sell the Notes to purchasers who are not
sophisticated purchasers unless an official statement or other disclosure document
is prepared with respect to the Notes.
6. Town's Comprehensive Annual Financial Report. While the Notes are still
outstanding, the Town as soon as available within one hundred eighty (J 80) days
after the end of each fiscal year of the Town, shall furnish to the undersigned a
copy of the Town's Comprehensive Annual Financial Report (including audited
financial statements).
241997v.2 TR0200171 000
Honorable Mayor and Town Councilmember
February 1, 2010
This purchase agreement may be executed in one or more counterparts, all of which shall
constitute one and the same instrument and each of which shall be, and shall be deemed to be, an
original.
If this purchase agreement meets with your approval, please execute it in the place
provided below and return one fully executed copy to us.
Very truly yours,
TIB-THE lNDEPENDENT BANKERSBANK
Signature Page Jor Purchase Agreement
241997v.2 TR0200171000
ACCEPTED BY TOWN OF TROPHY CLUB, TEXAS
Mayor
Signature Page Jor Purchase Agreement
PAYING AGENTIREGISTRAR AGREEMENT
between
TOWN OF TROPHY CLUB, TEXAS
and
Till-THE INDEPENDENT BANKERSBANK
Pertaining to
Town of Trophy Club, Texas
Tax Notes
Series 2010
Dated as of February I, 2010
TABLE OF CONTENTS
ARTICLE I
APPOINTMENT OF BANK AS PAYING AGENT AND REGISTRAR
Section 1.01 Appoinhnent .......................................................................................................... 1
Section 1.02 Compensation ........................................................................................................ 1
ARTICLE II
DEFINITIONS
Section 2.01 Definitions ............................................................................................................. 2
ARTICLE III
PAYING AGENT
Section 3.01 Duties of Paying Agent... ....................................................................................... 3
Section 3.02 Payment Dates ....................................................................................................... 4
Section 4.01
Section 4.02
Section 4.03
Section 4.04
Section 4.05
Section 4.06
Section 4.07
Section 5.01
Section 5.02
Section 5.03
Section 5.04
Section 5.05
Section 5.06
Section 5.07
US 240822v.1
ARTICLEN
REGISTRAR
Transfer and Exchange .......................................................................................... 4
The Obligations ..................................................................................................... 4
Form of Register .................................................................................................... 4
List of Owners ....................................................................................................... 5
Cancellation of Obligations ................................................................................... 5
Mutilated, Destroyed, Lost, or Stolen Obligations ................................................ 5
Transaction Information to Issuer. ......................................................................... 6
ARTICLE V
THE BANK
Duties of Bank ....................................................................................................... 6
Reliance on Documents, Etc .................................................................................. 6
Recitals of Issuer ................................................................................................... 7
May Hold Obligations ........................................................................................... 7
Money Held by Bank ............................................................................................. 7
Indemnification ...................................................................................................... 8
In terpl ead er ............................................................................................................ 8
(i)
Section 6.01
Section 6.02
Section 6.03
Section 6.04
Section 6.05
Section 6.06
Section 6.07
Section 6.08
Section 6.09
Section 6.10
Section 6.11
Section 6.12
ARTICLE VI
MISCELLANEOUS PROVISIONS
Amendment ........................................................................................................... 8
Assignment ............................................................................................................ 8
Notices ................................................................................................................... 8
Designated Payment/Transfer Office .................................................................... 9
Effect of Headings ................................................................................................. 9
Successors and Assigns ......................................................................................... 9
Separability ............................................................................................................ 9
Benefits of Agreement ........................................................................................... 9
Entire Agreement ................................................................................................... 9
Counterparts ........................................................................................................... 9
Tennination ........................................................................................................... 9
Governing Law .................................................................................................... 10
Annex A-Schedule of Fees for Services as Paying AgentiRegistrar
(ii)
US 240822v.1
PAYING AGENTIREGISTRAR AGREEMENT
THIS PAYING AGENT/REGISTRAR AGREEMENT (the or this "Agreement"), dated
as of February I, 2010, is by and between THE TOWN OF TROPHY CLUB, TEXAS (the
"Issuer"), and TIB-THE INDEPENDENT BANKERS BANK, Irving, Texas (the "Bank"), a
national banking association authorized to do business in Texas.
WHEREAS, the Issuer has duly authorized and provided for the issuance of its Tax
Notes, Series 2010 (the "Obligations"), to be issued as registered securities without coupons; and
WHEREAS, the Bank intends to purchase the Obligations, and, as part of the BanIc's
agreement with the Issuer to purchase the Obligations, the Bank has agreed to serve as Paying
AgentlRegistrar for the Obligations; and
WHEREAS, all things necessary to make the Obligations the valid obligations of the
Issuer, in accordance with their terms, will be taken upon the issuance and delivery thereof; and
WHEREAS, the Issuer is desirous that the Bank act as the Paying Agent of the Issuer in
paying the principal, redemption premium, if any, and interest on the Obligations, in accordance
with the terms thereof, and that the Bank act as Registrar for the Obligations; and
WHEREAS, the Issuer has duly authorized the execution and delivery of this Agreement;
and all things necessary to make this Agreement the valid agreement of the Issuer, in accordance
with its terms, have been done;
NOW, THEREFORE, it is mutually agreed as follows:
ARTICLE I
APPOINTMENT OF BANK AS PAYING AGENT AND REGISTRAR
Section 1.01 Appointment. (a) The Issuer hereby appoints the BanIc to act as Paying
Agent with respect to the Obligations in paying to the Owners of the Obligations the principal,
redemption premium, if any, and interest on all or any of the Obligations.
(b) The Issuer hereby appoints the BanIc as Registrar with respect to the Obligations.
(c) The Bank hereby accepts its appointment, and agrees to act as, the Paying Agent
and Registrar.
Section 1.02 Compensation. (a) As compensation for the Bank's services as Paying
Agent/Registrar, the Issuer hereby agrees so long as this agreement is in effect, to pay the Bank
the fees and amounts set forth in Annex A hereto for so long as the principal of and interest on,
or redemption price of, the Obligations, is unpaid.
(b) In addition, the Issuer agrees to reimburse the Bank upon its request for all
reasonable expenses, disbursements, and advances incurred or made by the Bank in accordance
US 240822v.1
with any of the provisions hereof, including the reasonable compensation and the expenses and
disbursements of its agents and counsel.
ARTICLE II
DEFINITIONS
Section 2.01 Definitions. For all purposes of tlus Agreement, except as otherwise
expressly provided or unless the context otherwise requires, the following terms have the
following meanings when used in this Agreement:
"Bank" means TIB-THE INDEPENDENT BANKERSBANK.
"Designated PaymentiTransfer Office" means tlle principal corporate trust office of the
Bank located in Irving, Texas, or in such other location as designated by the Paying
Agent/Registrar. The Banlc will notify the Issuer in writing of any change in location of the
Designated PaymentiTransfer Office.
"Fiscal Year" means the fiscal year of the Issuer.
"Issuer" means the Town of Trophy Club, Texas.
"Issuer Requesr' and "Issuer Order" means a written request or order signed in the name
of the Issuer by the Mayor, the Town Secretary, or any other authorized representative of the
Issuer and delivered to the Bank.
"Legal Holiday" means a day on which the Bank is required or authorized by applicable
law to be closed.
"Obligation" or "Obligations" means, collectively, any or all of the Issuer's Tax Notes,
Series 2010.
"Ordinance" means the resolution, order, or ordinance of the governing body of the
Issuer pursuant to which the Obligations are issued, certified by the Town Secretary or any other
officer of the Issuer, and delivered to the Banlc.
"Owner" means the Person in whose name a Obligation is registered in the Register.
"Paying AgentiRegistrar" means initially TIB-THE INDEPENDENT BANKERSBANK,
or any successor thereto as· provided in the Ordinance when it is performing the functions
associated with the tenns in tllis Agreement.
"Person" means any individual, corporation, partnership, joint venture, association, joint
stock company, trust, unincorporated organization, or government or any agency or political
subdivision of a government.
"Predecessor Obligations" of any particular Obligation means every previous Obligation
evidencing all or a portion of the same obligation as that evidenced by such particular Obligation
-2-
US 240822v.l
(and, for the purposes of this definition, any Obligation registered and delivered under Section
4.06 in lieu of a mutilated, lost, destroyed or stolen Obligation shall be deemed to evidence the
same obligation as the mutilated, lost, destroyed or stolen Obligation).
"Record Date" means the last business day of the month next preceding an interest
payment date established by the Ordinance.
"Register" means a register in which the Issuer shall provide for the registration and
transfer of Obligations.
"Responsible Officer" when used with respect to the Bank means the Chairman or Vice
Chairman of the Board of Directors, the Chairman or Vice Chairman of the Executive
Committee of the Board of Directors, the President, any Vice President, the Secretary, any
Assistant Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any Assistant Cashier,
any Trust Officer or Assistant Trust Officer, or any other officer of the Bank customarily
perfonning functions similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to whom such matter
is referred because of his knowledge of and familiarity with the particular subject.
"Stated Maturity" means the date or dates specified in the Ordinance as the fixed date on
which the principal of the Obligations is due and payable or the date fixed in accordance with the
terms of the Ordinance for redemption of the Obligations, or any portion thereof, prior to the
fixed maturity date.
Section 2.02. Other Definitions. The terms "Bank" and "Issuer" have the meanings
assigned to them in the opening paragraph of this Agreement.
ARTICLE III
PAYING AGENT
Section 3.01 Duties of Paying Agent. (a) The Bank, as Paying Agent and on behalf of
the Issuer, shall pay to the Owner at the Stated Maturity and upon the surrender of the Obligation
or Obligations so maturing at the Designated Payment/Transfer Office, the principal amount of
the Obligation or Obligations then maturing, and redemption premium, if any, provided that the
Bank shall have been provided by or on behalf of the Issuer adequate funds to malce such
payment.
(b) The Bank, as Paying Agent and on behalf of the Issuer, shall pay interest when
due on the Obligations to each Owner of the Obligations (or their Predecessor Obligations) as
shown in the Register at the close of business on the Record Date, provided that the Bank shall
have been provided by or on behalf of the Issuer adequate funds to malce such payments; such
payments shall be made by computing the amount of interest to be paid each Owner, preparing
the checks, and mailing the checks on each payment date addressed to the addresses thereof as
appearing on the Register on the Record Date.
US 240822v.1
Section 3.02 Payment Dates. The Issuer hereby instructs the Bank to pay the principal
of, redemption premium, if any, and interest on the Obligations on the dates specified in the
Ordinance.
ARTICLE IV
REGISTRAR
Section 4.01 Transfer and Exchange. (a) The Issuer shall keep the Register at the
Designated Payment/Transfer Office, and subject to such reasonable written regulations as the
Issuer may prescribe, which regulations shall be furnished to the Bank herewith or subsequent
hereto by Issuer Order, the Issuer shall provide for the registration and transfer of the
Obligations. The Bank is hereby appointed "Registrar" for the purpose of registering and
transferring the Obligations as herein provided.
(b) The Bank as Registrar hereby agrees that at any time while any Obligation is
outstanding, the Owner may deliver such Obligation to the Bank for transfer or exchange,
accompanied by instructions from the Owner, or the duly authorized designee of the Owner,
designating the persons, the maturities, and the principal amounts to and in which such
Obligation is to be transferred and the addresses of such persons; the Bank shall thereupon,
within not more than three (3) business days, register and deliver such Obligation or Obligations
as provided in such instructions. The provisions of the Ordinance shall control the procedures
for transfer or exchange set forth herein to the extent such procedures are in conflict with the
provisions of the Ordinance.
(c) Every Obligation surrendered for transfer or exchange shall be duly endorsed or
be accompanied by a written instrument of transfer, the signature on which has been guaranteed
in a manner satisfactory to the Bank, duly executed by the Owner thereof or his attorney duly
authorized in writing.
(d) The Bank may request any supporting documentation it feels necessary to effect a
re-registration.
Section 4.02 The Obligations. The Issuer shall provide an adequate inventory of
unregistered Obligations to facilitate transfers. The Banle covenants that it will maintain the
unregistered Obligations in safekeeping and will use reasonable care in maintaining such
unregistered Obligations in safekeeping, which shall be not less than the care it maintains for
debt securities of other governments or corporations for which it serves as registrar, or which it
maintains for its own securities.
Section 4.03 Fonn of Register. (a) The Banle as Registrar will maintain the records of
the Register in accordance with the Banle's general practices and procedures in effect from time
to time. The Bank shall not be obligated to maintain such Register in any fonn other than a fonn
which the BanIe has currently available and utilizes at the time.
(b) The Register may be maintained in written fonn or in any other fonn capable of
being converted into written fonn within a reasonable time.
-4-
us 240822v.1
Section 4.04 List of Owners. (a) The Bank will provide the Issuer at any time
requested by the Issuer, upon payment of the cost, if any, of reproduction, a copy of the
information contained in the Register. The Issuer may also inspect the information in the
Register at any time the Bank is customarily open for business, provided that reasonable time is
allowed the Bank to provide an up-to-date listing or to convert the information into written fonn.
(b) Unless otherwise required by law, the Bank will not release or disclose the
content of the Register to any person other than to, or at the written request of, an authorized
officer or employee of the Issuer, except upon receipt of a subpoena or court order as otherwise
required by law. Upon receipt of a subpoena or court order, the Bank will notifY the Issuer so
that the Issuer may contest the subpoena or court order.
(c) At all times, while the Bank is Registrar, the Bank shall maintain and have
available a copy of the Register at an office in the State of Texas.
Section 4.05 Cancellation of Obligations. All Obligations surrendered for payment,
redemption, transfer, exchange, or replacement, if surrendered to the Ban1c, shall be promptly
cancelled by it; if surrendered to the Issuer, shall be delivered to the Bank and, if not already
cancelled, shall be promptly cancelled by the Bank. The Issuer may at any time deliver to the
Bank for cancellation any Obligations previously certified or registered and delivered which the
Issuer may have acquired in any manner whatsoever, and all Obligations so delivered shall be
promptly cancelled by the Bank. All cancelled Obligations held by the Bank shall be disposed of
in accordance with the Securities Exchange Act of 1934.
Section4.06 Mutilated, Destroyed, Lost, or Stolen Obligations. (a) Subject to the
provisions of this Section 4.06, the Issuer hereby instructs the Bank to deliver fully registered
Obligations in exchange for or in lieu of mutilated, destroyed, lost, or stolen Obligations as long
as the same does not result in an overissuance.
(b) If (i) any mutilated Obligation is surrendered to the Ban1c, or the Issuer and the
Balli, receives evidence to their satisfaction of the destruction, loss, or theft of any Obligation,
and (ii) there is delivered to the Issuer and the Bank such security or indemnity as may be
required by the Banle to save and hold each of them harmless, then in the absence of notice to the
Issuer or the Banle that such Obligation has been acquired by a bona fide purchaser, the Issuer
shall execute, and upon its request the Bank shall register and deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost, or stolen Obligation, a new Obligation of the same stated
maturity and of like tenor and principal amount bearing a number not contemporaneously
outstanding.
(c) Every new Obligation issued pursuant to this Section in lieu of any mutilated,
destroyed, lost, or stolen Obligation shall constitute a replacement of the prior obligation of the
Issuer, whether or not the mutilated, destroyed, lost, or stolen Obligation shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of the Ordinance equally and
ratably with all other outstanding Obligations.
(d) Upon the satisfaction of the Bank and the Issuer that an Obligation has been
mutilated, destroyed, lost, or stolen, and upon receipt by the Bank and the Issuer of such
-5-
us 240822v.1
indemnity or security as they may require, the Bank shall cancel the Obligation number on the
Obligation registered with a notation in the Register that said Obligation has been mutilated,
destroyed, lost, or stolen; and a new Obligation shall be issued of the same series and of like
tenor and principal amount bearing a number, according to the Register, not contemporaneously
outstanding.
(e) The Bank may charge the Owner the Bank's fees and expenses in connection with
Issumg a new Obligation in lieu of or exchange for a mutilated, destroyed, lost, or stolen
Obligation.
(f) The Issuer hereby accepts the Bank's current blanket bond for lost, stolen, or
destroyed Obligations and any future substitute blanket bond for lost, stolen, or destroyed
Obligations that the Bank may arrange, and agrees that the coverage under any such blanket
bond is acceptable to it and meets the Issuer's requirements as to security or indemnity. The
Bank need not notify the Issuer of any changes in the security or other company giving such
bond or the terms of any such bond, provided that the amount of such bond is not reduced below
the amount of the bond on the date of execution of this Agreement. The blanket bond then
utilized by the Bank for lost, stolen, or destroyed Obligations by the Bank is available for
inspection by the Issuer on request.
Section 4.07 Transaction Information to Issuer. The Bank will, within a reasonable
time after receipt of written request from the Issuer, furnish the Issuer information as to the
Obligations it has paid pursuant to 3.01; Obligations it has delivered upon the transfer or
exchange of any Obligations pursuant to Section 4.01; and Obligations it has delivered in
exchange for or in lieu of mutilated, destroyed, lost, or stolen Obligations pursuant to Section
4.06 of this Agreement.
ARTICLE V
THE BANK
Section 5.01 Duties of Bank. The Bank undertakes to perform the duties set forth
herein and in accordance with the Ordinance and agrees to use reasonable care in the
performance thereof. The Bank hereby agrees to use the funds deposited with it for payment of
the principal of, redemption premium, if any, and interest on the Obligations to pay the
Obligations as the same shall become due and further agrees to establish and maintain all
accounts and funds as may be required for the Bank to function as Paying Agent.
Section 5.02 Reliance on Documents, Etc. (a) The Banle may conclusively rely, as to
the truth of the statements and correctness of the opinions expressed therein, on certificates or
opinions furnished to the Bank.
(b) The Bank shall not be liable for any error of judgment made in good faith by a
Responsible Officer, unless it shall be proved that the Bank was negligent in ascertaining the
pertinent facts.
-6-
US 240822v.l
(c) No provisions of this Agreement shall require the Bank to expend or risk its own
funds or otherwise incur any financial liability for performance of any of its duties hereunder, or
in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity satisfactory to it against such risks or liability is
not assured to it.
(d) The Bank may rely and shall be protected in acting or refraining from acting upon
any resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, certificate, note, security, or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties. Without limiting the
generality of the foregoing statement, the Bank need not examine the ownership of any
Obligations, but is protected in acting upon receipt of Obligations containing an endorsement or
instruction of transfer or power of transfer which appears on its face to be signed by the Owner
or an attorney-in-fact of the Owner. The Bank shall not be bound to make any investigation into
the facts or matters stated in a resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, certificate, note, security, or other paper or document
supplied by Issuer.
(e) The Bank may consult with counsel, and the written advice of such counselor any
opinion of counsel shall be full and complete authorization and protection with respect to any
action taken, suffered, or omitted by it hereunder in good faith and in reliance thereon.
(f) The Bank may exercise any of the powers hereunder and perform any duties
hereunder either directly or by or tlrrough agents cir attorneys and the Bank.
Section 5.03 Recitals ofIssuer. (a) The recitals contained herein and in the Obligations
shall be taken as the statements of the Issuer, and the Bank assumes no responsibility for their
correctness.
(b) The Bank shall in no event be liable to the Issuer, any Owner, or any other Person
for any amount due on any Obligation except as otherwise expressly provided herein Witll
respect to the liability of the Bank for its duties under this Agreement.
Section 5.04 May Hold Obligations. The Bank, in its individual or any other capacity,
may become the Owner or pledgee of Obligations and may otherwise deal with the Issuer with
the same rights it would have if it were not the Paying AgentlRegistrar, or any other agent.
Section 5.05 Money Held by Bank. (a) Money held by the Bank hereunder need not be
segregated from any other funds provided appropriate accounts are maintained.
(b) The Bank shall be under no liability for interest on any money received by it
hereunder.
(c) Subject to the provisions of Title 6, Texas Property Code, any money deposited
with the Bank for the payment of the principal, redemption premium, if any, or interest on any
Obligation and remaining unclaimed for tlrree years after final maturity of the Obligation has
become due and payable will be paid by the Bank to the Issuer, and the Owner of such
-7-
US 240822v.1
Obligation shall thereafter look only to the Issuer for the payment thereof, and all liability of the
Bank with respect to such monies shall thereupon cease.
(d) The Bank will comply with the reporting requirements of Chapter 74 of the Texas
Property Code.
(e) When theBank is not the Owner of all the Obligations outstanding, the Bank shall
deposit any moneys received from the Issuer into a trust account to be held in a paying agency
capacity for the payment of the Obligations, with such moneys in the account that exceed the
deposit insurance available to the Issuer provided by the Federal Deposit Insurance Corporation
to be fully collateralized with securities or obligations that are eligible under the laws of the State
of Texas and to the extent practicable under the laws of the United States of America to secure
and be pledged as collateral for trust accounts until the principal and interest on the Obligations
have been presented for payment and paid to the owner thereof. Payments made from such trust
account shall be made by check drawn on such trust account unless the owner of such Securities
shall, at its own expense and risk, request such other medium of payment.
Section 5.06 Indemnification. To the extent permitted by law, the Issuer agrees to
indemnifY the Bank, its officers, directors, employees, and agents for, and hold them harmless
against, any loss, liability, or expense incurred without negligence or bad faith on their part
arising out of or in connection with its acceptance or administration of the Bank's duties
hereunder, and under Article V of the Ordinance, including the cost and expense (including its
counsel fees) of defending itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties under this Agreement.
Section 5.07 Interpleader. The Issuer and the Bank agree that the Bank may seek
adjudication of any adverse claim, demands or controversy over its persons as well as funds on
deposit in the appropriate state or federal court in the State of Texas; waive personal service of
any process; and agree that service of process by certified or registered mail, return receipt
requested, to the address set forth in this Agreement shall constitute adequate service. The Issuer
and the Bank further agree that the Bank has the right to file a Bill of Interpleader in any court of
competent jurisdiction in the State of Texas to determine the rights of any person claiming any
interest herein.
ARTICLE VI
MISCELLANEOUS PROVISIONS
Section 6.01 Amendment. This Agreement may be amended only by an agreement in
writing signed by both of the parties hereof.
Section 6.02 Assignment. This Agreement may not be assigned by either party without
the prior written consent of the other.
Section 6.03 Notices. Any request, demand, authorization, direction, notice, consent,
waiver, or other document provided or permitted hereby to be given or furnished to the Issuer or
-8-
US 240822v.1
the Banlc shall be mailed or delivered to the Issuer or the Bank, respectively, at the addresses
shown below:
(a) ifto the Issuer:
(b) ifto the Bank:
Town of Trophy Club, Texas
100 Municipal Drive
Trophy Club, Texas 76262
Attention: Mayor
TIB-The Independent BankersBank
350 Phelps Drive
Irving, Texas 75038
Section 6.04 Designated Payment/Transfer Office. The Designated Payment/Transfer
Office shall be the office of the Banlc as set forth in Section 6.03.
Section 6.05 Effect of Headings. The Article and Section headings herein are for
convenience only and shall not affect the construction hereof.
Section 6.06 Successors and Assigns. All covenants and agreements herein by the
Issuer shall bind its successors and assigns, whether so expressed or not.
Section 6.07 Separabilitv. If any provision herein shall be invalid, illegal, or
unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 6.08 Benefits of Agreement. Nothing herein, express or implied, shall give to
any Person, other than the parties hereto and their successors hereunder, any benefit or any legal
or equitable right, remedy, or claim hereunder.
Section 6.09 Entire Agreement. This Agreement and the Ordinance constitute the
entire agreement between the parties hereto relative to the Bank acting as Paying
Agent/Registrar, and if any conflict exists between this Agreement and the Ordinance, the
Ordinance shall govern.
Section 6.1 0 Counterparts. This Agreement may be executed in any number of
counterparts, each which shall be deemed an original and all of which shall constitute one and
the same Agreement.
Section 6.11 Termination. (a) This Agreement will terminate on the date of final
payment by the Bank issuing its checks for the final payment of principal, redemption premium,
if any, and interest ofthe Obligations.
(b) The Issuer may not terminate the Bank as Paying Agent/Registrar so long as the
banle is the sole holder of the Obligations.
(c) If the Bank is not the sole holder of the Obligations, this Agreement may be
earlier terminated upon sixty (60) days written notice by either party; provided, that, no
termination shall be effective until a successor has been appointed by the Issuer and has accepted
-9-
US 240822v.1
the duties imposed by this Agreement. The resigning Paying Agent/Registrar may petition any
court of competent jurisdiction for the appointment of a successor Paying AgentlRegistrar if an
instrument of acceptance by a successor Paying AgentlRegistrar has not been delivered to the
resigning Paying AgentlRegistrar within sixty (60) days after giving notice of resignation.
(d) The provisions of Section 1.02 and of Article Five shall survive and remain in full
force and effect following the termination ofthis Agreement.
Section 6.12 Governing Law. This Agreement shall be construed in accordance with
and governed by the laws of the State of Texas.
[Execution Pages Follow]
-10-
US 240822v.1
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year first written above.
TOWN OF TROPHY CLUB, TEXAS
By: ----,f!o<-La~/Ut''''''·___=_ML~''"''_· __ _ -7 Mayor
ATTEST:
Paying Agent/Registrar Agreement
TIB-THE INDEPENDENT BANKERSBANK,
as Paying Agent/Registrar
By:
Title: _______________ _
Paying Agent/Registrar Agreement
TOWN OF TROPHY CLUB, TEXAS
The Attorney General of Texas
300 West 15th Street, 7th Floor
Austin, Texas 78701
Attention: Public Finance Section
Comptroller of Public Accounts
February 1, 2010
208 East 10th Street, 4th Floor, Room 448
Austin, Texas 78701
Attention: BondlResearch Division
Re: Town of Trophy Club, Texas, Tax Notes, Series 2010
To the Attorney General:
The executed Initial Note of the captioned series has been or soon will be delivered to
you for examination and approval. In this connection, enclosed herewith is a General and No-
Litigation Certificate executed and completed except as to date. When the Initial Note has
received your approval and is ready for delivery to the Comptroller of Public Accounts for
registration, this letter will serve as your authority to insert the date of your approval in the
General and No-Litigation Certificate and deliver the Initial Note to the Comptroller.
Should litigation in any way affecting such notes develop, the undersigned will notifY
you at once by telephone and telecommunication. You may be assured therefore, that there is no
such litigation at the time the Initial Note is finally approved by you, unless you have been
advised otherwise.
To the Comptroller:
The approved Initial Note of the captioned series will be delivered to you by the Attorney
General of Texas. You are hereby requested to register the Initial Note as required by law and
by the proceedings authorizing such Initial Note.
Following registration, you are hereby authorized and directed to notifY and deliver the
Initial Note to Vinson & Elkins L.L.P., Dallas, Texas.
US 246107v.1
Please deliver to Vinson & Elkins L.L.P., Dallas, Texas, five copies of each of the
following:
I. Attorney General's approving opinion; and
2. Comptroller's signature certificate.
Very truly yours,
-2-
TOWN OF TROPHY CLUB, TEXAS
By
I. Mayor
TOWN OF TROPHY CLUB, TEXAS
TIB-The Independent BankersBank
350 Phelps Drive
Irving, Texas 75038
February 1,2010
Re: Town of Trophy Club, Texas, Tax Notes Series 2010
Ladies and Gentlemen:
The Issuer and the Purchaser of the captioned series of Notes (the "Notes") have
designated your bank as the place, and as their agent, for the delivery and payment of the Notes.
The initial Note (the "Initial Note") of this series will be delivered to you and you are hereby
authorized and directed to hold the Initial Note for safekeeping pending said delivery and
payment. Upon your receipt of the final unqualified legal opinion of Vinson & Elkins L.L.P., as
to the validity of the Notes, you are authorized and directed to deliver the Initial Note to the
Purchaser thereof in accordance with the instructions of the Purchaser.
You are further authorized and directed to apply the aforesaid proceeds received from the
delivery and payment of the Notes immediately upon receipt in accordance with instructions
provided by the City's financial advisor and appropriate staff.
Sincerely,
TOWN OF TROPHY CLUB, TEXAS
Mayor
US 24051 Ov.1