2021-43 - O -Issuance and sale of General Obligation Bonds Series 2021 ORDINANCE NO. 2021-43
of the
TOWN OF PROSPER, TEXAS
AUTHORIZING THE ISSUANCE OF
TOWN OF PROSPER, TEXAS
GENERAL OBLIGATION BONDS
SERIES 2021
Table of Contents
Section 1. Recitals, Amount,Purpose and Designation of the Bonds 2
Section 2. Definition 2
Section 3. Delegation to Pricing Officer 3
Section 4. Characteristics of the Bonds 4
Section 5. Form of Bonds 8
Section 6. Interest and Sinking Fund 16
Section 7. Pledge 16
Section 8. Defeasance of Bonds 17
Section 9. Damaged, Mutilated,Lost,Stolen, or Destroyed Bonds 18
Section 10. Custody, Approval, and Registration of Bonds; Bond Counsel Opinion; Engagement
of Bond Counsel; Use of CUSIP Numbers; Contingent Insurance
Provision, if Obtained;Attorney General Filing Fee 19
Section 11. Covenants Regarding Tax Exemption of Interest on the Bonds 20
Section 12. Sale of Bonds;Official Statement 23
Section 13. Continued Perfection of Security Interest 24
Section 14. Compliance with Rule 15c2-12 24
Section 15. Method of Amendment 27
Section 16. Investments; Security for Funds 29
Section 17. Governing Law 30
Section 18. Severability 30
Section 19. Events of Default 30
Section 20. Remedies for Default 30
Section 21. Remedies Not Exclusive 30
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ORDINANCE NO.2021-43 APPROVING ALL MATTERS INCIDENT AND RELATED TO
THE ISSUANCE, SALE AND DELIVERY OF UP TO $40,000,000 IN PRINCIPAL
AMOUNT OF"TOWN OF PROSPER GENERAL OBLIGATION BONDS,SERIES 2021";
AUTHORIZING THE ISSUANCE OF THE BONDS; DELEGATING THE AUTHORITY
TO CERTAIN TOWN OFFICIALS TO EXECUTE CERTAIN DOCUMENTS RELATING
TO THE SALE OF THE BONDS; APPROVING AND AUTHORIZING INSTRUMENTS
AND PROCEDURES RELATING TO SAID BONDS; ENACTING OTHER PROVISIONS
RELATING TO THE SUBJECT;AND PROVIDING AN EFFECTIVE DATE
THE STATE OF TEXAS §
COLLIN AND DENTON COUNTIES §
TOWN OF PROSPER §
WHEREAS,at an election in the Town of Prosper, Texas(the"Issuer") held on November
3,2020(the "Election"), the voters of the Issuer approved the issuance of tax bonds by the Issuer
in three propositions totaling$210,000,000;and
WHEREAS,the Town Council of the Issuer(the"Town Council")deems it necessary and
advisable to authorize, issue and deliver a portion of the bonds authorized hereby (the "Bonds"),
using certain amounts shown as set forth in a Pricing Certificate (hereinafter defined) from the
approved Propositions, as set forth below:
Maximum
Amount of
Bonds from
Bonds Proposition
Election Bonds Previously that may be
Prop Purpose Approved Issued" Issued°
A For public safety facilities in the Town,consisting of fire $30,000,000 $-0- $18,000,000
stations,an emergency operations center,a public safety
training facility and administrative facilities relating
thereto.
B For equipping parks,trails and recreational facilities in $30,000,000 5-0- $2,200,000
the Town and the acquisition of land and interests in land
for such purposes.
C For conswcting, improving, extending, expanding, $150,000,000 $ - $19,800,000
upgrading and developing streets and roads,bridges and
intersections in the Town and related drainage
improvements,utility relocations,landscaping,curbs and
sidewalks,traffic safety and operational improvements,
entryway signage and other street and road signage and
costs associated with such projects,and interests in land
as may be necessary for such purposes,and excluding
certain road projects to be funded with other obligations.
Totals $210,100,000 $-0- $40,000,000
(9 Includes premium being deposited to the construction fiord in connection with prior and current issues,thereby using the amounts
of voted authorization shown Actual amount issued to be set forth in a Pricing Certificate.
WHEREAS, the Town Council deems it advisable to issue Bonds in the amount of up to
$40,000,000 for the purposes approved in Proposition C at the Election; and
WHEREAS,the Issuer is an "issue?' within the meaning of Section 1371.001(4)(P),Texas
Government Code,having(i)a principal amount of at least$100 million in outstanding long term
indebtedness, in long term indebtedness proposed to be issued,or in a combination of outstanding
or proposed long term indebtedness and(ii)some amount of long term indebtedness outstanding or
proposed to be issued that is rated in one of the four highest rating categories for long term debt
instruments by a nationally recognized rating agency for municipal securities,without regard to the
effect of any credit agreement or other form of credit enhancement entered into in connection with
the obligation;and
WHEREAS, the Bonds hereinafter authorized to be issued and are to be issued, sold and
delivered pursuant to the general laws of the State of Texas, including Chapter 1331, Texas
Government Code,as amended,and Chapter 1371,Texas Government Code, as amended;and
WHEREAS, it is officially found, determined, 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 Texas Government Code
Chapter 551;
NOW, THEREFORE BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF
PROSPER, TEXAS:
Section 1. RECITALS,AMOUNT, PURPOSE AND DESIGNATION OF THE BONDS.
(a) The recitals set forth in the preamble hereof are incorporated herein and shall have the
same force and effect as if set forth in this Section.
(b) The Bonds of the Issuer are hereby authorized to be issued and delivered in one or more
series in the maximum aggregate principal amount hereinafter set forth for the purpose of
constructing and acquiring the public improvements approved at the Election and described in the
preambles hereto, and to pay the costs incurred in connection with the issuance of the Bonds.
(c) Unless otherwise provided in the Pricing Certificate,each Bond issued pursuant to this
Ordinance shall be designated:"TOWN OF PROSPER,TEXAS GENERAL OBLIGATION BOND,
SERIES 2021," and initially there shall be issued, sold, and delivered hereunder fully registered
Bonds,without interest coupons,payable to the respective registered owners thereof(with the initial
Bond being made payable to the initial purchaser as described in Section 12 hereof), or to the
registered assignee or assignees of said Bonds or any portion or portions thereof(in each case,the
"Registered Owner"). The Bonds shall be in the respective denominations and principal amounts,
shall be numbered,shall mature and be payable on the date or dates in each of the years and in the
principal amounts or amounts due at maturity, as applicable, and shall bear interest to their
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respective dates of maturity or redemption prior to maturity at the rates per annum,as set forth in
the Pricing Certificate.
Section 2. DEFINITION. Unless otherwise expressly provided or unless the context clearly
requires otherwise in this Ordinance, the following term shall have the meaning specified below:
"Bonds" means and includes collectively the Bonds initially issued and delivered pursuant
to this Ordinance and all substitute Bonds exchanged therefor,as well as all other substitute bonds
and replacement bonds issued pursuant hereto, and the term "Bond" shall mean any of the Bonds.
Section 3. DELEGATION TO PRICING OFFICER.
(a) As authorized by Section 1371.053, Texas Government Code, as amended, the Town
Manager of the Issuer is hereby authorized to act on behalf of the Issuer in selling and delivering the
Bonds to finance costs approved by the voters of the Town at the Election (such officer shall be
hereinafter referred to as, and shall for all purposes be, the "Pricing Officer") and carrying out the
other procedures specified in this Ordinance,including,determining(i)whether the Bonds shall be
issued in one or more series or subseries, (ii) whether Bonds of different series shall be issued
concurrently or at different times within the delegation period provided herein,(iii) the date of the
Bonds,(iv)any additional or different designation or title by which the Bonds shall be known,(v)
the price at which the Bonds will be sold,(vi)the principal amount to mature in each year,(vii)the
years in which the Bonds will mature, (viii)the rate of interest to be borne by each such maturity,
(ix)the interest payment and record dates,(x)the price and terms upon and at which the Bonds shall
be subject to redemption prior to maturity at the option of the Issuer, as well as any mandatory
sinking fund redemption provisions, (xi) whether if the Bonds shall be issued as obligations the
interest on which is exempt from federal income taxation or as taxable obligations with respect to
which interest on the Bonds are subject to federal income taxation and whether, if issued as tax-
exempt obligations and qualify as "Qualified Tax-Exempt Obligations" for purposes of Section
265(b), Internal Revenue Code, whether they shall be so designated, (xii) limiting the types of
securities and obligations that may be used as Defeasance Securities and all other matters relating
to the issuance,sale,and delivery of the Bonds,and(xiii)all other matters relating to the issuance,
sale,and delivery of the Bonds, including,without limitation,procuring municipal bond insurance
(if it is determined that such insurance would be financially desirable and advantageous), and
approving modifications to this Ordinance and executing such instruments, documents and
agreements as may be necessary with respect thereto,all of which shall be specified in the Pricing
Certificate. The delegations made hereby shall expire if not exercised by the Pricing Officer on or
prior to the one year anniversary following the adoption of this Ordinance. The delegations made
hereby are subject to the following parameters:
(i) the voted authorization from the Election used in the issuance of such Bonds shall be
taken from the following propositions: Proposition A (and shall not exceed $18,000,000 in total
voted authorization used); Proposition B (and shall not exceed $2,200,000 in total voted
authorization used); and Proposition C (and shall not exceed $19,800,000 in total voted
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authorization used); the amount of voted authorization from each proposition shall be set forth in
a Pricing Certificate;
(ii)the maximum true interest cost for the Bonds of any series shall not exceed 3.50%; and
(iii)the final maturity of any Bond issued shall not be later than February 15, 2041.
(b) In establishing the aggregate principal amount of the Bonds, the Pricing Officer shall
establish an amount not exceeding the amount authorized in Subsection(aXi)above,which shall be
sufficient in amount to provide for the purposes for which the Bonds are authorized and to pay costs
of issuing the Bonds. The Bonds shall be sold at such price,with and subject to such terms as set
forth in the Pricing Certificate. In the event that the Pricing Officer determines to sell more than one
series of Bonds,the parameters set forth in(a)shall apply to each series,provided the that Pricing
Officer shall not sell an amount of Bonds for the purposes provided in Subsection(a)above that
exceed the aggregate amount authorized by Subsection(aXi)above.
(c) The Bonds of one or more series may be issued as Current Interest Bonds or Capital
Appreciation Bonds,or a combination thereof,as set forth in the Pricing Certificate. The Bonds of
one or more series may be sold by public offering (either through a negotiated or competitive
offering) or by private placement. If any Bonds are sold by private placement, the Pricing
Certificate shall so state, and the Pricing Certificate may make changes to this Ordinance to effect
such private placement, including the provisions hereof that pertain to the book-entry-only
procedures (including eliminating the book-entry-only system of registrations, payment and
transfers) and to the provisions of Section 15 hereof relating to the Rule 15c2-12 undertaking
(including eliminating or replacing such undertaking with an agreement to provide alternative
disclosure information). In addition, if all or part of the Bonds are sold in a series with respect to
which the interest on the Bonds of such series is not exempt from federal income taxation, the
Pricing Certificate shall so state, and the Pricing Certificate may make changes to this Ordinance
to effect such taxable issuance, including, specifically providing that the covenants of Section 11
hereof shall not be applicable to such series.
(d) In the event any of the Bonds are issued as Capital Appreciation Bonds, the Pricing
Certificate shall have attached thereto a schedule which sets forth the rounded original principal
amounts at the Issuance Date for the Capital Appreciation Bonds and the Compounded Amounts
thereof(per$5,000 payment at maturity), including the initial premium,if any,as of each date and
commencing on the date set forth in such schedule. Reference shall be made to such schedule,
which shall set forth the rounded original principal amounts at the issuance date for the Capital
Appreciation Bonds and the Compounded Amounts thereof(per $5,000 payment at maturity),
including the initial premium,if any,as of each February 15 and August 15,commencing on the first
February 15 or August 15 following the issuance date,and continuing until the final maturity of the
Premium Capital Appreciation Bonds. The Compounded Amount with respect to any date other
than a February 15 or August 15 is the amount set forth on such schedule,as the case may be,plus
the portion of the difference between such amount and the amount set forth on the schedule with
respect to the next succeeding February 15 or August 15,as the case may be,that the number of days
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(based on 30-day months)from such last preceding February 15 or August 15,as the case may be,
to the date for which such determination is being calculated bears to the total number of days(based
on 30-day months)from such last preceding February 15 or August 15, as the case may be, to the
next succeeding February 15 or August 15,as the case may be.
(e) In satisfaction of Section 1201.022(a)(3)(B), Texas Government Code, the Council
hereby determines that the delegation of the authority to the Pricing Officer to approve the final
terms of the Bonds set forth in this Ordinance is, and the decisions made by the Pricing Officer
pursuant to such delegated authority and incorporated into the Pricing Certificate will be, in the
Issuer's best interests,and the Pricing Officer is hereby authorized to make and include in the Pricing
Certificate a finding to that effect.
Section 4. CHARACTERISTICS OF THE BONDS.
(a) Registration,Transfer,Conversion and Exchange. The Issuer shall keep or cause to be
kept at the designated office of the bank named in the Pricing Certificate as the paying
agent/registrar for the Bonds(the "Paying Agent/Registrar"), books or records for the registration
of the transfer, conversion and exchange of the Bonds (the "Registration Books"),and the Issuer
hereby appoints the Paying Agent/Registrar as its registrar and transfer agent to keep such books or
records and make such registrations of transfers,conversions and exchanges under such reasonable
regulations as the Issuer and Paying Agent/Registrar may prescribe;and the Paying Agent/Registrar
shall make such registrations,transfers,conversions and exchanges as herein provided within three
days of presentation in due and proper form. The Paying Agent/Registrar shall obtain and record
in the Registration Books the address of the Registered Owner of each Bond to which payments with
respect to the Bonds shall be mailed,as herein provided; but it shall be the duty of each Registered
Owner to notify the Paying Agent/Registrar in writing of the address to which payments shall be
mailed, and such interest payments shall not be mailed unless such notice has been given. The
Issuer shall have the right to inspect the Registration Books during regular business hours of the
Paying Agent/Registrar,but otherwise the Paying Agent/Registrar shall keep the Registration Books
confidential and, unless otherwise required by law, shall not permit their inspection by any other
entity. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges
for making such registration, transfer, conversion, exchange and delivery of a substitute Bond or
Bonds. Registration of assignments,transfers,conversions and exchanges of Bonds shall be made
in the manner provided and with the effect stated in the FORM OF BOND set forth in this
Ordinance. Each substitute Bond shall bear a letter and/or number to distinguish it from each other
Bond.
(b) Authentication. Except as provided in Section 4(e)hereof,an authorized representative
of the Paying Agent/Registrar shall,before the delivery of any such Bond,date and manually sign
said Bond, and no such Bond shall be deemed to be issued or outstanding unless such Bond is so
executed. The Paying Agent/Registrar promptly shall cancel all paid Bonds and Bonds surrendered
for conversion and exchange. No additional ordinances, orders or resolutions need be passed or
adopted by the governing body of the Issuer or any other body or person so as to accomplish the
foregoing conversion and exchange of any Bond or portion thereof,and the Paying Agent/Registrar
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shall provide for the printing, execution and delivery of the substitute Bonds in the manner
prescribed herein. Pursuant to Subchapter D,Chapter 1201,Texas Government Code,the duty of
conversion and exchange of Bonds as aforesaid is hereby imposed upon the Paying Agent/Registrar,
and, upon the execution of said Bond, the converted and exchanged Bond shall be valid,
incontestable, and enforceable in the same manner and with the same effect as the Bonds which
initially were issued and delivered pursuant to this Ordinance,approved by the Attorney General,
and registered by the Comptroller of Public Accounts.
(c) Payment of Bonds and Interest. The Issuer hereby further appoints the Paying
Agent/Registrar to act as the paying agent for paying the principal of and interest on the Bonds,all
as provided in this Ordinance. The Paying Agent/Registrar shall keep proper records of all
payments made by the Issuer and the Paying Agent/Registrar with respect to the Bonds,and of all
conversions and exchanges of Bonds,and all replacements ofBonds,as provided in this Ordinance.
However,in the event of a nonpayment of interest on a scheduled payment date,and for thirty(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 Issuer. Notice of the Special Record Date and of the scheduled payment date
of the past due interest(which shall be 15 days after the Special Record Date)shall be sent at least
five (5) business days prior to the Special Record Date by United States mail, first-class postage
prepaid,to the address of each Registered Owner appearing on the Registration Books at the close
of business on the last business day next preceding the date of mailing of such notice.
(d) Substitute Paying Agent/Registrar. The Issuer covenants with the Registered Owners
of the Bonds that at all times while the Bonds are outstanding the Issuer will provide a competent
and legally qualified bank,trust company,financial institution or other agency to act as and perform
the services of Paying Agent/Registrar for the Bonds under this Ordinance, and that the Paying
Agent/Registrar will be one entity. The Issuer reserves the right to,and may,at its option,change
the Paying Agent/Registrar upon not less than 60 days written notice to the Paying Agent/Registrar,
to be effective not later than 45 days prior to the next principal or interest payment date after such
notice. In the event that the entity at any time acting as Paying Agent/Registrar(or its successor by
merger, acquisition, or other method) should resign or otherwise cease to act as such, the Issuer
covenants that promptly it will appoint a competent and legally qualified bank, trust company,
financial institution,or other agency to act as Paying Agent/Registrar under this Ordinance. Upon
any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar promptly shall
transfer and deliver the Registration Books(or a copy thereof),along with all other pertinent books
and records relating to the Bonds,to the new Paying Agent/Registrar designated and appointed by
the Issuer. Upon any change in the Paying Agent/Registrar,the Issuer promptly will cause a written
notice thereof to be sent by the new Paying Agent/Registrar to each Registered Owner of the Bonds,
by United States mail,first-class postage prepaid,which notice also shall give the address of the new
Paying Agent/Registrar. By accepting the position and performing as such, each Paying
Agent/Registrar shall be deemed to have agreed to the provisions of this Ordinance,and a certified
copy of this Ordinance shall be delivered to each Paying Agent/Registrar.
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(e) General Characteristics of the Bonds. The Bonds(i)shall be issued in fully registered
form,without interest coupons,with the principal of and interest on such Bonds to be payable only
to the Registered Owners thereof,(ii)may be redeemed prior to their scheduled maturities(notice
of which shall be given to the Paying Agent/Registrar by the Issuer at least 50 days prior to any such
redemption date), (iii) may be transferred and assigned, (iv) may be converted and exchanged for
other Bonds, (v) shall have the characteristics, (vi) shall be signed, sealed, executed and
authenticated, (vii) the principal of and interest on the Bonds shall be payable, and(viii) shall be
administered and the Paying Agent/Registrar and the Issuer shall have certain duties and
responsibilities with respect to the Bonds, all as provided, and in the manner and to the effect as
required or indicated, in the FORM OF BOND set forth in this Ordinance. The Bonds initially
issued and delivered pursuant to this Ordinance is not required to be,and shall not be,authenticated
by the Paying Agent/Registrar, but on each substitute Bond issued in conversion of and exchange
for any Bond or Bonds issued under this Ordinance the Paying Agent/Registrar shall execute the
Paying Agent/registrar's Authentication Bond,in the FORM OF BOND set forth in this Ordinance.
(f) Book-Entry Only System. Unless the Bonds are sold by private placement,the Bonds
issued in exchange for the Bonds initially issued to the purchaser specified herein shall be initially
issued in the form ofa separate single fully registered Bond for each of the maturities thereof. Upon
initial issuance,the ownership of each such Bond shall be registered in the name of Cede&Co.,as
nominee of The Depository Trust Company of New York ("DTC"), and except as provided in
subsection (g)hereof, all of the outstanding Bonds shall be registered in the name of Cede&Co.,
as nominee of DTC.
With respect to Bonds registered in the name of Cede&Co.,as nominee of DTC,the Issuer
and the Paying Agent/Registrar shall have no responsibility or obligation to any securities brokers
and dealers,banks,trust companies,clearing corporations and certain other organizations on whose
behalf DTC was created ("DTC Participant") to hold securities to facilitate the clearance and
settlement of securities transactions among DTC Participants or to any person on behalf of whom
such a DTC Participant holds an interest in the Bonds. Without limiting the immediately preceding
sentence,the Issuer and the Paying Agent/Registrar shall have no responsibility or obligation with
respect to(i)the accuracy of the records of DTC,Cede&Co.or any DTC Participant with respect
to any ownership interest in the Bonds,(ii)the delivery to any DTC Participant or any other person,
other than a registered owner of Bonds, as shown on the Registration Books, of any notice with
respect to the Bonds,or(iii)the payment to any DTC Participant or any other person,other than a
registered owner of Bonds, as shown in the Registration Books of any amount with respect to
principal of or interest on the Bonds. Notwithstanding any other provision of this Ordinance to the
contrary,the Issuer and the Paying Agent/Registrar shall be entitled to treat and consider the person
in whose name each Bond is registered in the Registration Books as the absolute owner of such
Bond for the purpose of payment ofprincipal and interest with respect to such Bond,for the purpose
of registering transfers with respect to such Bond, and for all other purposes whatsoever. The
Paying Agent/Registrar shall pay all principal of and interest on the Bonds only to or upon the order
of the registered owners,as shown in the Registration Books as provided in this Ordinance,or their
respective attorneys duly authorized in writing, and all such payments shall be valid and effective
to fully satisfy and discharge the Issuer's obligations with respect to payment of principal of and
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interest on the Bonds to the extent of the sum or sums so paid. No person other than a registered
owner,as shown in the Registration Books,shall receive a Bond certificate evidencing the obligation
of the Issuer to make payments of principal and interest pursuant to this Ordinance. Upon delivery
by DTC to the Paying Agent/Registrar of written notice to the effect that DTC has determined to
substitute a new nominee in place of Cede& Co., and subject to the provisions in this Ordinance
with respect to interest checks being mailed to the registered owner at the close of business on the
Record date, the words "Cede&Co." in this Ordinance shall refer to such new nominee of DTC.
(g) Successor Securities Depository; Transfers Outside Book-Entry Only System. If the
Bonds are subject to the DTC book-entry system, and in the event that the Issuer determines that
DTC is incapable of discharging its responsibilities described herein and in the representation letter
of the Issuer to DTC or that it is in the best interest of the beneficial owners of the Bonds that they
be able to obtain certificated Bonds, the Issuer shall (i) appoint a successor securities depository,
qualified to act as such under Section 17A of the Securities and Exchange Act of 1934,as amended,
notify DTC and DTC Participants of the appointment of such successor securities depository and
transfer one or more separate Bonds to such successor securities depository or(ii)notify DTC and
DTC Participants ofthe availability through DTC ofBonds and transfer one or more separate Bonds
to DTC Participants having Bonds credited to their DTC accounts. In such event,the Bonds shall
no longer be restricted to being registered in the Registration Books in the name of Cede&Co.,as
nominee of DTC, but may be registered in the name of the successor securities depository, or its
nominee,or in whatever name or names registered owners transferring or exchanging Bonds shall
designate, in accordance with the provisions of this Ordinance.
(h) Payments to Cede&Co. Notwithstanding any other provision of this Ordinance to the
contrary, so long as any Bond is registered in the name of Cede & Co., as nominee of DTC,all
payments with respect to principal of and interest on such Bond and all notices with respect to such
Bond shall be made and given, respectively, in the manner provided in the representation letter of
the Issuer to DTC.
(i) Cancellation of Initial Bonds. On the closing date, one initial Bond representing the
entire principal amount of the Bonds,payable in stated installments to the purchaser designated in
the Pricing Certificate or its designee, executed by manual or facsimile signature of the Mayor(or
in the absence thereof, by the Mayor Pro-tem) and Town Secretary of the Issuer, approved by the
Attorney General of Texas, and registered and signed manually, by facsimile, electronically or
otherwise by the Comptroller of Public Accounts of the State of Texas, will be delivered to such
purchaser or its designee. Upon payment for the initial Bond, the Comptroller or the Paying
Agent/Registrar (whichever entity has custody of the initial Bond) shall cancel the initial Bond.
Thereupon, the Paying Agent/Registrar shall deliver to DTC on behalf of such purchaser one
registered definitive Bond for each year of maturity of the Bonds,in the aggregate principal amount
of all of the Bonds for such maturity.
(j) Conditional Notice of Redemption. With respect to any optional redemption of the
Bonds, unless certain prerequisites to such redemption required by this Ordinance have been met
and moneys sufficient to pay the principal of and premium, if any,and interest on the Bonds to be
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redeemed shall have been received by the Paying Agent/Registrar prior to the giving of such notice
of redemption, such notice shall state that said redemption may, at the option of the Issuer, be
conditional upon the satisfaction of such prerequisites and receipt of such moneys by the Paying
Agent/Registrar on or prior to the date fixed for such redemption,or upon any prerequisite set forth
in such notice of redemption. If a conditional notice of redemption is given and such prerequisites
to the redemption and sufficient moneys are not received,such notice shall be of no force and effect,
the Issuer shall not redeem such Bonds and the Paying Agent/Registrar shall give notice, in the
manner in which the notice of redemption was given, to the effect that the Bonds have not been
redeemed.
Section 5. FORM OF BONDS. The forms of the Bonds, including form of the initial Bond,
the form of Paying Agent/Registrar's Authentication Bond,the form of Assignment and the form of
Registration Bond of the Comptroller of Public Accounts of the State of Texas to be attached to the
Bonds initially issued and delivered pursuant to this Ordinance,shall be,respectively,substantially
as follows, with such appropriate variations,omissions, or insertions as are permitted or required
by this Ordinance. The FORM OF BOND shall be completed with information set forth in the
Pricing Certificate and shall be attached to the Pricing Certificate as an exhibit thereto.
(a) Form of Bond.
BOND R_ UNITED STATES OF AMERICA PRINCIPAL
STATE OF TEXAS AMOUNT
TOWN OF PROSPER,TEXAS $
GENERAL OBLIGATION BOND
SERIES 2021
DATE OF INITIAL
INTEREST DELIVERY OF MATURITY
RATE BONDS DATE CUSIP NO.
_% ,2021
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
ON THE MATURITY DATE specified above,the Town of Prosper, in Collin and Denton
Counties,Texas(the"Issuer"),being a political subdivision of the State of Texas,hereby promises
to pay to the Registered Owner set forth above,or registered assigns(hereinafter called the"regis-
tered owner") the principal amount set forth above, and to pay interest thereon from the Date of
Initial Delivery of Bonds set forth above, on and on each and
thereafter to the maturity date specified above, or the date of redemption prior to
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maturity, at the interest rate per annum specified above; except that if this Bond is required to be
authenticated and the date of its authentication is later than the first Record Date (hereinafter
defined),such principal amount shall bear interest from the interest payment date next preceding the
date of authentication,unless such date of authentication is after any Record Date but on or before
the next following interest payment date, in which case such principal amount shall bear interest
from such next following interest payment date; provided, however, that if on the date of
authentication hereof the interest on the Bond or Bonds, if any, for which this Bond is being
exchanged or converted from is due but has not been paid,then this Bond shall bear interest from
the date to which such interest has been paid in full.
THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the
United States of America,without exchange or collection charges. The principal of this Bond shall
be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity,or
upon the date fixed for its redemption prior to maturity, at the designated trust office of
,in , ,which is the"Paying Agent/Registrar"for this Bond.
The payment of interest on this Bond shall be made by the Paying Agent/Registrar to the registered
owner hereof on each interest payment date by check or draft,dated as of such interest payment date,
drawn by the Paying Agent/Registrar on, and payable solely from,funds of the Issuer required by
the order authorizing the issuance of the Bonds(the "Bond Ordinance")to be on deposit with the
Paying Agent/Registrar for such purpose as hereinafter provided; and such check or draft shall be
sent by the Paying Agent/Registrar by United States mail,first-class postage prepaid,on each such
interest payment date,to the registered owner hereof,at its address as it appeared on the last day of
the month next preceding each such date (the "Record Date"), on the Registration Books kept by
the Paying Agent/Registrar,as hereinafter described. In addition,interest may be paid by such other
method,acceptable to the Paying Agent/Registrar,requested by,and at the risk and expense of,the
registered owner. In the event of a non-payment of interest on a scheduled payment date, and for
30 days thereafter, a new record date for such interest payment (a "Special Record Date")will be
established by the Paying Agent/Registrar,if and when funds for the payment of such interest have
been received from the Issuer. Notice ofthe Special Record Date and ofthe scheduled payment date
of the past due interest(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 Bond appearing on the Registration Books at the close
of business on the last business day next preceding the date of mailing of such notice.
ANY ACCRUED INTEREST due at maturity or upon the redemption of this Bond prior to
maturity as provided herein shall be paid to the registered owner upon presentation and surrender
of this Bond for payment at the designated trust office of the Paying Agent/Registrar. The Issuer
covenants with the registered owner of this Bond that on or before each principal payment date and
interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the
"Interest and Sinking Fund"created by the Bond Ordinance,the amounts required to provide for the
payment, in immediately available funds,of all principal of and interest on the Bonds, when due.
IF THE DATE for any payment due on this Bond shall be a Saturday, Sunday, a legal
holiday,or a day on which banking institutions in the city where the designated trust office of the
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Paying Agent/Registrar is located are authorized by law or executive order to close,then the date
for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal
holiday,or day on which banking institutions are authorized to close,and payment on such date shall
have the same force and effect as if made on the original date payment was due.
THIS BOND is one of a Series of Bonds dated as of , authorized in accordance
with the Constitution and laws of the State of Texas in the principal amount of$
for the public purpose of and paying the costs of issuing the Bonds.
THE BONDS OF THIS SERIES maturing on in the years are
subject to mandatory redemption prior to maturity in part at random, by lot or other customary
method selected by the Paying Agent/Registrar,at par plus accrued interest to the redemption date,
and without premium,with funds on deposit in the Interest and Sinking Fund. Such Bonds shall be
redeemed by the Paying Agent/Registrar on in each of the years and in the principal
amounts,respectively,as are set forth in the following schedule:
Bonds Maturing Bonds Maturing Bonds Maturing
Principal Principal Principal
Year Amount Year Amount Year Amount
(1)Final maturity of Bond.
The principal amount of the Bonds required to be redeemed pursuant to the operation of such
mandatory sinking fund shall be reduced by the principal amount of any Bonds which,at least 45
days prior to the mandatory sinking fund redemption date(i)shall have been purchased by the Issuer
and delivered to the Paying Agent/Registrar for cancellation or (ii) redeemed pursuant to the
optional redemption provision described below and not theretofore credited against a mandatory
sinking fund requirement.
IN ADDITION TO THE FOREGOING MANDATORY REDEMPTION,the Bonds of this
series maturing on and after may be redeemed prior to their scheduled maturities on
any date on or after ,at the option of the Issuer,with funds derived from any available
and lawful source,as a whole,or in part,and,if in part,the particular Bonds,or portions thereof,to
be redeemed shall be selected and designated by the Issuer(provided that a portion of a Bond may
be redeemed only in an integral multiple of$5,000), at a redemption price equal to the principal
amount to be redeemed plus accrued interest to the date fixed for redemption.
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AT LEAST 30 days prior to the date fixed for any redemption of Bonds or portions thereof
prior to maturity a written notice of such redemption shall be sent by the Paying Agent/Registrar by
United States mail,first-class postage prepaid,to the registered owner of each Current Interest Bond
to be redeemed at its address as it appeared on the day such notice of redemption is mailed and to
major securities depositories,national bond rating agencies and bond information services;provided,
however,that the failure of the registered owner to receive such notice,or any defect therein or in
the sending or mailing thereof, shall not affect the validity or effectiveness of the proceedings for
the redemption of any Bond. By the date fixed for any such redemption, due provision shall be
made with the Paying Agent/Registrar for the payment of the required redemption price for the
Bonds or portions thereof which are to be so redeemed. If such written notice of redemption is sent
and if due provision for such payment is made,all as provided above,the Bonds or portions thereof
which are to be so redeemed thereby automatically shall be treated as redeemed prior to their
scheduled maturities, and they shall not bear interest after the date fixed for redemption, and they
shall not be regarded as being outstanding except for the right of the registered owner to receive the
redemption price from the Paying Agent/Registrar out of the funds provided for such payment. If
a portion of any Bond shall be redeemed a substitute Bond or Bonds having the same maturity date,
bearing interest at the same rate, in any denomination or denominations in any integral multiple of
$5,000, at the written request of the registered owner, and in aggregate amount equal to the
unredeemed portion thereof, will be issued to the registered owner upon the surrender thereof for
cancellation,at the expense of the Issuer,all as provided in the Bond Ordinance.
ALL BONDS OF THIS SERIES are issuable solely as fully registered Bonds, without
interest coupons,in the denomination of any integral multiple of$5,000. As provided in the Bond
Ordinance,this Bond may,at the request of the registered owner or the assignee or assignees hereof,
be assigned,transferred,converted into and exchanged for a like aggregate amount of fully regis-
tered Bonds, without interest coupons, payable to the appropriate registered owner, assignee or
assignees, as the case may be,having any authorized denomination or denominations as requested
in writing by the appropriate registered owner,assignee or assignees,as the case may be,upon sur-
render of this Bond to the Paying Agent/Registrar for cancellation,all in accordance with the form
and procedures set forth in the Bond Ordinance. Among other requirements for such assignment
and transfer,this Bond must be presented and surrendered to the Paying Agent/Registrar, together
with proper instruments of assignment, in form and with guarantee of signatures satisfactory to the
Paying Agent/Registrar,evidencing assignment of this Bond or any portion or portions hereof in any
authorized denomination to the assignee or assignees in whose name or names this Bond or any such
portion or portions hereof is or are to be registered. The form of Assignment printed or endorsed
on this Bond may be executed by the registered owner to evidence the assignment hereof,but such
method is not exclusive, and other instruments of assignment satisfactory to the Paying
Agent/Registrar may be used to evidence the assignment of this Bond or any portion or portions
hereof from time to time by the registered owner. The Paying Agent/Registrar's reasonable standard
or customary fees and charges for assigning,transferring,converting and exchanging any Bond or
portion thereof will be paid by the Issuer. In any circumstance,any taxes or governmental charges
required to be paid with respect thereto shall be paid by the one requesting such assignment,transfer,
conversion or exchange, as a condition precedent to the exercise of such privilege. The Paying
Agent/Registrar shall not be required to make any such transfer or exchange with respect to Bonds
(i)during the period commencing with the close of business on any Record Date and ending with
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the opening of business on the next following principal or interest payment date,or(ii)with respect
to any Bond or any portion thereof called for redemption prior to maturity,within 45 days prior to
its redemption date.
IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the Issuer,resigns,
or otherwise ceases to act as such,the Issuer has covenanted in the Bond Ordinance that it promptly
will appoint a competent and legally qualified substitute therefor,and cause written notice thereof
to be mailed to the registered owners of the Bonds.
IT IS HEREBY certified,recited and covenanted that this Bond has been duly and validly
authorized, issued and delivered; that all acts, conditions and things required or proper to be
performed,exist and be done precedent to or in the authorization,issuance and delivery of this Bond
have been performed, existed and been done in accordance with law; that this Bond is a general
obligation of said Issuer,issued on the full faith and credit thereof;and that annual ad valorem taxes
sufficient to provide for the payment of the interest on and principal of this Bond,as such interest
comes due and such principal matures,have been levied and ordered to be levied against all taxable
property in said Issuer,and have been pledged for such payment,within the limit prescribed by law,
all as provided in the Bond Ordinance.
THE ISSUER ALSO HAS RESERVED THE RIGHT to amend the Bond Ordinance as
provided therein,and under some(but not all)circumstances amendments thereto must be approved
by the registered owners of a majority in aggregate principal amount of the outstanding Bonds.
BY BECOMING the registered owner of this Bond, the registered owner thereby
acknowledges all of the terms and provisions of the Bond Ordinance, agrees to be bound by such
terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for
inspection in the official minutes and records of the governing body of the Issuer,and agrees that
the terms and provisions of this Bond and the Bond Ordinance constitute a contract between each
registered owner hereof and the Issuer.
IN WITNESS WHEREOF,the Issuer has caused this Bond to be signed with the manual or
facsimile signature of the Mayor of the Issuer(or in his absence,the Mayor Pro-tem) and counter-
signed with the manual or facsimile signature of the Town Secretary of the Issuer,and has caused
the official seal of the Issuer to be duly impressed, or placed in facsimile,on this Bond.
Town Secretary Mayor
(SEAL)
(b) Form of Paying Agent/Registrar's Authentication Bond
PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE
(To be executed if this Bond is not accompanied by an executed Registration Bond
of the Comptroller of Public Accounts of the State of Texas)
It is hereby certified that this Bond has been issued under the provisions of the Bond
Ordinance described in the text of this Bond; and that this Bond has been issued in conversion or
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replacement of,or in exchange for,a bond,bonds,or a portion of a bond or bonds of a Series which
originally was approved by the Attorney General of the State of Texas and registered by the
Comptroller of Public Accounts of the State of Texas.
Date of authentication:
Paying Agent/Registrar
By
Authorized Signatory
(c) Form of Assignment:
ASSIGNMENT
For value received,the undersigned hereby sells,assigns and transfers unto
Please insert Social Security or Taxpayer Identification Number of Transferee
Please print or typewrite name and address, including zip code of Transferee
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
, attorney, to register the transfer of the within
Bond
on the books kept for registration thereof,with full power of substitution in the premises.
Dated:
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed by NOTICE:The signature above must correspond
an eligible guarantor institution participating in with the name of the Registered Owner as it
a securities transfer association recognized appears upon the front of this Bond in every
signature guarantee program. particular,without alteration or enlargement or
any change whatsoever.
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(d) Form of Registration Bond of the Comptroller of Public Accounts:
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER §
OF PUBLIC ACCOUNTS § REGISTER NO.
OF THE STATE OF TEXAS §
I hereby certify that this Bond has been examined,certified as to validity,and approved by
the Attorney General of the State of Texas, and that this Bond has been registered by the
Comptroller of Public Accounts of the State of Texas.
WITNESS MY SIGNATURE AND SEAL this
Comptroller of Public Accounts of the State of Texas
(COMPTROLLER'S SEAL)
(e) Insertions for the initial Bond.
(i) The initial Bond shall be in the form set forth in paragraph (a) of this Section,
except that:
(A) immediately under the name of the Bond, the headings "INTEREST
RATE" and "MATURITY DATE" shall both be completed with the words "As
shown below"and"CUSIP NO. " shall be deleted.
(B) the first paragraph shall be deleted and the following will be inserted:
"THE TOWN OF PROSPER(the"Issuer"),being a political subdivision located in Collin
and Denton Counties, Texas, hereby promises to pay to the Registered Owner specified above,or
registered assigns (hereinafter called the "Registered Owner"), on the dates, in the principal
installments and bearing interest at the per annum rates set forth in the following schedule:
Maturity Dates Principal Interest Rates
Installments
(Information for the Bonds from the Pricing Certificate to be inserted.)
The Issuer promises to pay interest on the unpaid principal amount hereof(calculated on the basis
of a 360-day year of twelve 30-day months) from at the respective Interest Rate per
annum specified above. Interest is payable from the Date of Initial Delivery of Bonds shown above
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on ,and on each and thereafter to the date of payment of the
principal installment specified above,or the date of redemption prior to maturity;except,that if this
Bond is required to be authenticated and the date of its authentication is later than the first Record
Date(hereinafter defined),such principal amount shall bear interest from the interest payment date
next preceding the date of authentication,unless such date of authentication is after any Record Date
but on or before the next following interest payment date,in which case such principal amount shall
bear interest from such next following interest payment date;provided,however,that if on the date
of authentication hereof the interest on the Bond or Bonds, if any, for which this Bond is being
exchanged is due but has not been paid, then this Bond shall bear interest from the date to which
such interest has been paid in full."
(C) The initial Bond shall be numbered "T-1".
Section 6. INTEREST AND SINKING FUND. A special "Interest and Sinking Fund" is
hereby created and shall be established and maintained by the Issuer at an official depository bank
of the Issuer. Said Interest and Sinking Fund shall be kept separate and apart from all other funds
and accounts of the Issuer, and shall be used only for paying the interest on and principal of the
Bonds. All amounts received from the sale of the Bonds as accrued interest and ad valorem taxes
levied and collected for and on account of the Bonds shall be deposited, as collected,to the credit
of said Interest and Sinking Fund. During each year while any of the Bonds are outstanding and
unpaid, the governing body of the Issuer shall compute and ascertain a rate and amount of ad
valorem tax that will be sufficient to raise and produce the money required to pay the interest on the
Bonds as such interest comes due, and to provide and maintain a sinking fund adequate to pay the
principal of the Bonds as such principal matures(but never less than 2%of the original amount of
the Bonds as a sinking fund each year); and said tax shall be based on the latest approved tax rolls
of the Issuer,with full allowances being made for tax delinquencies and the cost of tax collection.
Said rate and amount of ad valorem tax is hereby levied,and is hereby ordered to be levied,against
all taxable property in the Issuer,for each year while any of the Bonds are outstanding and unpaid,
and said tax shall be assessed and collected each such year and deposited to the credit of the
aforesaid Interest and Sinking Fund.
Section 7. PLEDGE. The Issuer hereby covenants to levy ad valorem taxes sufficient to
provide for the payment of the interest on and principal ofthe Bonds,as such interest comes due and
such principal matures,and such ad valorem taxes are hereby pledged for such payment,within the
limit prescribed by law.
Section 8. DEFEASANCE OF BONDS.
(a) Defeasance. Any Bond and the interest thereon shall be deemed to be paid,retired,and
no longer outstanding (a "Defeased Bond") within the meaning of this Ordinance, except to the
extent provided in subsection(d)of this Section,when payment of the principal of such Bond,plus
interest thereon to the due date(whether such due date be by reason of maturity or otherwise)either
(i)shall have been made or caused to be made in accordance with the terms thereof,or(ii)shall have
been provided for on or before such due date by irrevocably depositing with or making available to
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the Paying Agent/Registrar in accordance with an escrow agreement or other instrument(the"Future
Escrow Agreement")for such payment(1)lawful money of the United States of America sufficient
to make such payment or(2)Defeasance Securities that mature as to principal and interest in such
amounts and at such times as will insure the availability,without reinvestment,of sufficient money
to provide for such payment,and when proper arrangements have been made by the Issuer with the
Paying Agent/Registrar for the payment of its services until all Defeased Bonds shall have become
due and payable. At such time as a Bond shall be deemed to be a Defeased Bond hereunder, as
aforesaid,such Bond and the interest thereon shall no longer be secured by,payable from,or entitled
to the benefits of,the ad valorem taxes herein levied and pledged as provided in this Ordinance,and
such principal and interest shall be payable solely from such money or Defeasance Securities, and
thereafter the Issuer will have no further responsibility with respect to amounts available to the
Paying Agent/Registrar(or other financial institution permitted by applicable law)for the payment
of such Defeased Bonds, including any insufficiency therein caused by the failure of the Paying
Agent/Registrar(or other financial institution permitted by applicable law)to receive payment when
due on the Defeasance Securities. Notwithstanding any other provision of this Ordinance to the
contrary, it is hereby provided that any determination not to redeem Defeased Bonds that is made
in conjunction with the payment arrangements specified in subsection(a)(i) or(ii)of this Section
shall not be irrevocable, provided that: (1) in the proceedings providing for such payment
arrangements,the Issuer expressly reserves the right to call the Defeased Bonds for redemption;(2)
gives notice of the reservation of that right to the Registered Owners of the Defeased Bonds
immediately following the making of the payment arrangements; and(3)directs that notice of the
reservation be included in any redemption notices that it authorizes.
(b) Investment and Disposition of Funds. Any moneys so deposited with the Paying
Agent/Registrar may at the written direction of the Issuer also be invested in Defeasance Securities,
maturing in the amounts and times as hereinbefore set forth,and all income from such Defeasance
Securities received by the Paying Agent/Registrar that is not required for the payment of the Bonds
and interest thereon,with respect to which such money has been so deposited,shall be turned over
to the Issuer, or deposited as directed in writing by the Issuer. Any Future Escrow Agreement
pursuant to which the money and/or Defeasance Securities are held for the payment of Defeased
Bonds may contain provisions permitting the investment or reinvestment of such moneys in
Defeasance Securities or the substitution of other Defeasance Securities upon the satisfaction of the
requirements specified in subsection(aXi)or(ii)of this Section. All income from such Defeasance
Securities received by the Paying Agent/Registrar which is not required for the payment of the
Defeased Bonds,with respect to which such money has been so deposited,shall be remitted to the
Issuer or deposited as directed in writing by the Issuer.
(c) Defeasance Securities. Subject to any statement to the contrary that may be included in
the Pricing Certificate,the term"Defeasance Securities" means any securities and obligations now
or hereafter authorized by State law that are eligible to refund, retire or otherwise discharge
obligations such as the Bonds.
(d) Paying Agent/Registrar Services. Until all Defeased Bonds shall have become due and
payable,the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for such
18
Defeased Bonds the same as if they had not been defeased, and the Issuer shall make proper
arrangements to provide and pay for such services as required by this Ordinance.
(e) Selection of Defeased Bonds. In the event that the Issuer elects to defease less than all
of the principal amount of Bonds of a maturity,the Paying Agent/Registrar shall select,or cause to
be selected, such amount of Bonds by such random method as it deems fair and appropriate.
Section 9. DAMAGED, MUTILATED,LOST, STOLEN,OR DESTROYED BONDS.
(a) Replacement Bonds. In the event any outstanding Bond is damaged, mutilated, lost,
stolen,or destroyed,the Paying Agent/Registrar shall cause to be printed,executed,and delivered,
a new Bond of the same principal amount, maturity, and interest rate, as the damaged, mutilated,
lost, stolen, or destroyed Bond, in replacement for such Bond in the manner hereinafter provided.
(b) Application for Replacement Bonds. Application for replacement of damaged,
mutilated, lost, stolen, or destroyed Bonds shall be made by the Registered Owner thereof to the
Paying Agent/Registrar. In every case ofloss,theft,or destruction of a Bond,the Registered Owner
applying for a replacement Bond shall furnish to the Issuer and to the Paying Agent/Registrar such
security or indemnity as may be required by them to save each of them harmless from any loss or
damage with respect thereto. Also, in every case of loss, theft, or destruction of a Bond, the
Registered Owner shall furnish to the Issuer and to the Paying Agent/Registrar evidence to their
satisfaction of the loss, theft,or destruction of such Bond. In every case of damage or mutilation
of a Bond,the Registered Owner shall surrender to the Paying Agent/Registrar for cancellation the
Bond so damaged or mutilated.
(c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the
event any such Bond shall have matured, and no default has occurred which is then continuing in
the payment of the principal of or interest on the Bond,the Issuer may authorize the payment of the
same (without surrender thereof except in the case of a damaged or mutilated Bond) instead of
issuing a replacement Bond,provided security or indemnity is furnished as above provided in this
Section.
(d) Charge for Issuing Replacement Bonds. Prior to the issuance of any replacement Bond,
the Paying Agent/Registrar shall charge the Registered Owner of such Bond with all legal,printing,
and other expenses in connection therewith. Every replacement Bond issued pursuant to the
provisions of this Section by virtue of the fact that any Bond is lost, stolen, or destroyed shall
constitute a contractual obligation of the Issuer whether or not the lost, stolen, or destroyed Bond
shall be found at any time,or be enforceable by anyone,and shall be entitled to all the benefits of
this Ordinance equally and proportionately with any and all other Bonds duly issued under this
Ordinance.
(e) Authority for Issuing Replacement Bonds. In accordance with Subchapter B, Chapter
1206,Texas Government Code,this Section shall constitute authority for the issuance of any such
replacement Bond without necessity of further action by the governing body of the Issuer or any
19
other body or person, and the duty of the replacement of such Bonds is hereby authorized and
imposed upon the Paying Agent/Registrar, and the Paying Agent/Registrar shall authenticate and
deliver such Bonds in the form and manner and with the effect, as provided in Section 4(b)of this
Ordinance for Bonds issued in conversion and exchange for other Bonds.
Section 10. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND
COUNSEL OPINION;USE OF CUSIP NUMBERS;CONTINGENT INSURANCE PROVISION,
IF OBTAINED; ATTORNEY GENERAL FILING FEE;APPROPRIATION.
(a) The Mayor, Town Manager, Finance Director, Executive Director of Administrative
Services,Town Secretary and all other officers, employees and agents of the Issuer, and each of
them,shall be and they are hereby expressly authorized,empowered and directed from time to time
and at any time to do and perform all such acts and things and to execute,acknowledge and deliver
in the name and under the corporate seal and on behalf of the Issuer the Paying Agent/Registrar
Agreement with the Paying Agent/Registrar in substantially the form presented to the Council at the
meeting at which this Ordinance was adopted and all other instruments, whether or not herein
mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this
Ordinance, the Letter of Representations, the Bonds, the sale of the Bonds and the Official
Statement. Notwithstanding anything to the contrary contained herein,while the Bonds are subject
to DTC's Book-Entry Only System and to the extent permitted by law,the Letter of Representations
is hereby incorporated herein and its provisions shall prevail over any other provisions of this
Ordinance in the event of conflict. In case any officer whose signature shall appear on any Bond
shall cease to be such officer before the delivery of such Bond,such signature shall nevertheless be
valid and sufficient for all purposes the same as if such officer had remained in office until such
delivery.
(b) The obligation of the initial purchasers to accept delivery of the Bonds is subject to the
initial purchasers being furnished with the final,approving opinion of McCall,Parkhurst&Horton
L.L.P., bond counsel to the Issuer,which opinion shall be dated as of and delivered on the date of
initial delivery of the Bonds to the initial purchasers.
(c) To pay the debt service coming due on the Bonds, if any(as determined by the Pricing
Certificate)prior to receipt of the taxes levied to pay such debt service,there is hereby appropriated
from current funds on hand,which are hereby certified to be on hand and available for such purpose,
an amount sufficient to pay such debt service,and such amount shall be used for no other purpose.
(d) In accordance with the provisions of Section 1202.004, Tex. Gov't Code Ann., in
connection with the submission of the Bonds by the Attorney General of Texas for review and
approval, a statutory fee (an amount equal to 0.1% principal amount of the Bond, subject to a
minimum of$750 and a maximum as provided by State law)is required to be paid to the Attorney
General upon the submission of the transcript of proceedings for the Bonds. The Issuer hereby
authorizes and directs that a check,wire transfer or other form of payment acceptable to the Attorney
General,and in the amount of the Attorney General filing fee for the Bonds,be promptly provided
for payment to the Attorney General in connection with his review of the Bonds.
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Section 11. COVENANTS REGARDING TAX EXEMPTION OF INTEREST ON THE
BONDS. Subject to the determination of the Pricing Officer,as set forth in the Pricing Certificate
as to the treatment of the Bonds pursuant to the Code,the Issuer makes the following covenants with
respect to the Bonds.
(a) Covenants. The Issuer covenants to take any action necessary to assure,or refrain from
any action which would adversely affect, the treatment of the Bonds as obligations described in
section 103 of the Internal Revenue Code of 1986,as amended(the"Code"),the interest on which
is not includable in the "gross income" of the holder for purposes of federal income taxation. In
furtherance thereof,the Issuer covenants as follows:
(1) to take any action to assure that no more than 10 percent of the proceeds of the
Bonds or the projects financed therewith(less amounts deposited to a reserve fund, if any)
are used for any "private business use," as defined in section 141(bX6) of the Code or, if
more than 10 percent of the proceeds or the projects financed therewith are so used, such
amounts,whether or not received by the Issuer,with respect to such private business use,do
not,under the terms of this Ordinance or any underlying arrangement,directly or indirectly,
secure or provide for the payment of more than 10 percent of the debt service on the Bonds,
in contravention of section 141(b)(2) of the Code;
(2) to take any action to assure that in the event that the "private business use"
described in subsection (1) hereof exceeds 5 percent of the proceeds of the Bonds or the
projects financed therewith (less amounts deposited into a reserve fund, if any) then the
amount in excess of 5 percent is used for a"private business use"which is"related" and not
"disproportionate,"within the meaning of section 141(b)(3)ofthe Code,to the governmental
use;
(3) to take any action to assure that no amount which is greater than the lesser of
$5,000,000,or 5 percent ofthe proceeds of the Bonds(less amounts deposited into a reserve
fund,if any)is directly or indirectly used to finance loans to persons,other than state or local
governmental units, in contravention of section 141(c)of the Code;
(4) to refrain from taking any action which would otherwise result in the Bonds
being treated as "private activity bonds"within the meaning of section 141(b)of the Code;
(5) to refrain from taking any action that would result in the Bonds being"federally
guaranteed"within the meaning of section 149(b)of the Code;
(6) to refrain from using any portion of the proceeds of the Bonds, directly or
indirectly,to acquire or to replace funds which were used, directly or indirectly,to acquire
investment property (as defined in section 148(b)(2) of the Code) which produces a
materially higher yield over the term of the Bonds,other than investment property acquired
with—
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(A) proceeds of the Bonds invested for a reasonable temporary period of 3
years or less or, in the case of a refunding bond, for a period of 90 days or less until
such proceeds are needed for the purpose for which the Bonds are issued,
(B) amounts invested in a bona fide debt service fund,within the meaning
of section 1.148-1(b)of the Treasury Regulations, and
(C) amounts deposited in any reasonably required reserve or replacement
fund to the extent such amounts do not exceed 10 percent of the proceeds of the
Bonds;
(7) to otherwise restrict the use of the proceeds of the Bonds or amounts treated as
proceeds of the Bonds,as may be necessary,so that the Bonds do not otherwise contravene
the requirements of section 148 of the Code(relating to arbitrage);
(8) to refrain from using the proceeds of the Bonds or proceeds of any prior bonds
to pay debt service on another issue more than 90 days after the date of issue of the Bonds
in contravention of the requirements of section 149(d) of the Code (relating to advance
refundings); and
(9) to pay to the United States of America at least once during each five-year period
(beginning on the date of delivery of the Bonds)an amount that is at least equal to 90 percent
of the"Excess Earnings," within the meaning of section 148(f)of the Code and to pay to the
United States of America,not later than 60 days after the Bonds have been paid in full, 100
percent of the amount then required to be paid as a result of Excess Earnings under section
148(f) of the Code.
(b) Rebate Fund. In order to facilitate compliance with the above covenant(9),a"Rebate
Fund" is hereby established by the Issuer for the sole benefit of the United States of America,and
such fund shall not be subject to the claim of any other person, including without limitation the
bondholders. The Rebate Fund is established for the additional purpose of compliance with section
148 of the Code.
(c) Proceeds. The Issuer understands that the term "proceeds" includes "disposition
proceeds" as defined in the Treasury Regulations and, in the case of refunding bonds, transferred
proceeds(if any)and proceeds of the refunded certificates or bonds expended prior to the date of
issuance of the Bonds. It is the understanding of the Issuer that the covenants contained herein are
intended to assure compliance with the Code and any regulations or rulings promulgated by the U.S.
Department of the Treasury pursuant thereto. In the event that regulations or rulings are hereafter
promulgated which modify or expand provisions of the Code,as applicable to the Bonds,the Issuer
will not be required to comply with any covenant contained herein to the extent that such failure to
comply, in the opinion of nationally recognized bond counsel, will not adversely affect the
exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In
the event that regulations or rulings are hereafter promulgated which impose additional requirements
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which are applicable to the Bonds,the Issuer agrees to comply with the additional requirements to
the extent necessary, in the opinion of nationally recognized bond counsel, to preserve the
exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In
furtherance of such intention,the Issuer hereby authorizes and directs the Mayor or City Manager
to execute any documents,certificates or reports required by the Code and to make such elections,
on behalf of the Issuer,which may be permitted by the Code as are consistent with the purpose for
the issuance of the Bonds.
(d) Allocation of,and Limitation on,Expenditures for the Project. The Issuer covenants to
account for the expenditure of sale proceeds and investment earnings to be used for the purposes
described in Section 1 of this Ordinance(the"Project")on its books and records in accordance with
the requirements ofthe Internal Revenue Code. The Issuer recognizes that in order for the proceeds
to be considered used for the reimbursement ofcosts,the proceeds must be allocated to expenditures
within 18 months of the later of the date that (1) the expenditure is made, or (2) the Project is
completed; but in no event later than three years after the date on which the original expenditure is
paid. The foregoing notwithstanding,the Issuer recognizes that in order for proceeds to be expended
under the Internal Revenue Code,the sale proceeds or investment earnings must be expended no
more than 60 days after the earlier of(1)the fifth anniversary of the delivery of the Bond,or(2)the
date the Bond is retired. The Issuer agrees to obtain the advice of nationally-recognized bond
counsel if such expenditure fails to comply with the foregoing to assure that such expenditure will
not adversely affect the tax-exempt status of the Bond. For purposes hereof,the issuer shall not be
obligated to comply with this covenant if it obtains an opinion that such failure to comply will not
adversely affect the excludability for federal income tax purposes from gross income of the interest.
(e) Disposition of Project. The Issuer covenants that the property financed with the proceeds
of the Bonds in accordance with the Election,as described in the recitals to this Ordinance will not
be sold or otherwise disposed of in a transaction resulting in the receipt by the Issuer ofcash or other
compensation,unless any action taken in connection with such disposition will not adversely affect
the tax-exempt status of the Bonds. For purpose of the foregoing,the Issuer may rely on an opinion
of nationally-recognized bond counsel that the action taken in connection with such sale or other
disposition will not adversely affect the tax-exempt status of the Bonds. For purposes of the
foregoing, the portion of the property comprising personal property and disposed in the ordinary
course shall not be treated as a transaction resulting in the receipt of cash or other compensation.
For purposes hereof,the Issuer shall not be obligated to comply with this covenant if it obtains an
opinion that such failure to comply will not adversely affect the excludability for federal income tax
purposes from gross income of the interest.
Section 12. SALE OF BONDS; OFFICIAL STATEMENT.
(a) The Bonds shall be sold and delivered subject to the provisions of Sections 1 and 3 and
pursuant to the terms and provisions of a bond purchase agreement, notice of sale and bidding
instructions or private placement agreement (collectively, the "Purchase Agreement") which the
Pricing Officer is hereby authorized to execute and deliver and in which the purchaser or purchasers
(collectively, the "Purchaser") of the Bonds shall be designated. The Bonds shall initially be
registered in the name of the purchaser thereof as set forth in the Pricing Certificate.
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(b) The Pricing Officer is hereby authorized, in the name and on behalf of the Issuer, to
approve,distribute,and deliver a preliminary official statement and a final official statement relating
to the Bonds to be used by the Purchaser in the marketing of the Bonds.
Section 13. CONTINUED PERFECTION OF SECURITY INTEREST. Chapter 1208,
Government Code, applies to the issuance of the Bonds and the pledge of the ad valorem taxes
granted by the Issuer under Section 6 of this Ordinance and the pledge of the Surplus Revenues
under Section 7 of this Ordinance, and such pledge is therefore valid, effective, and perfected. If
Texas law is amended at any time while the Bonds are outstanding and unpaid such that the pledge
of the taxes granted by the Issuer under Section 6 of this Ordinance or the pledge of the Surplus
Revenues under Section 7 of this Ordinance is to be subject to the filing requirements of Chapter
9,Business&Commerce Code,then in order to preserve to the registered owners of the Bonds the
perfection of the security interest in said pledges, the Issuer agrees to take such measures as it
determines are reasonable and necessary under Texas law to comply with the applicable provisions
of Chapter 9,Business&Commerce Code and enable a filing to perfect the security interest in said
pledges to occur.
Section 14. COMPLIANCE WITH RULE 15c2-12.
(a) If the Bonds of a series are sold by public offering,and are subject to the Rule (as
defined below),the following provisions shall apply:
(i) Definitions. As used in this Section,the following terms have the meanings ascribed to
such terms below:
"Financial Obligation"means a(a)debt obligation;(b)derivative instrument entered into in
connection with,or pledged as security or a source of payment for, an existing or planned
debt obligation; or(c) guarantee of a debt obligation or any such derivative instrument;
provided that"financial obligation"shall not include municipal securities as to which a final
official statement(as defined in the Rule)has been provided to the MSRB consistent with
the Rule.
"MSRB" means the Municipal Securities Rulemaking Council.
"Rule" means SEC Rule 15c2-12, as amended from time to time.
"SEC" means the United States Securities and Exchange Commission.
(ii) Annual Reports. (A) The Issuer shall provide annually to the MSRB, in the electronic
format prescribed by the MSRB, financial information and operating data(the"Annual Operating
Report") with respect to the Issuer of the general type included in the final Official Statement
authorized by this Ordinance,being the information described in the Pricing Certificate. The Issuer
will additionally provide financial statements of the Issuer(the"Financial Statements"),that will be
(i)prepared in accordance with the accounting principles described in the Pricing Certificate or such
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other accounting principles as the Issuer may be required to employ from time to time pursuant to
State law or regulation and shall be in substantially the form included in the final Official Statement
and(ii) audited, if the Issuer commissions an audit of such Financial Statements and the audit is
completed within the period during which they must be provided. The Issuer will update and
provide the Annual Operating Report within six months after the end of each fiscal year and the
Financial Statements within 12 months of the end of each fiscal year,in each case beginning with
the fiscal year ending in and after 2021. The Issuer may provide the Financial Statements earlier,
including at the time it provides its Annual Operating Report, but if the audit of such Financial
Statements is not complete within 12 months after any such fiscal year end,then the Issuer shall file
unaudited Financial Statements within such 12-month period and audited Financial Statements for
the applicable fiscal year, when and if the audit report on such Financial Statements becomes
available.
(B) If the Issuer changes its fiscal year, it will notify the MSRB of the change(and of the
date of the new fiscal year end) prior to the next date by which the Issuer otherwise would be
required to provide financial information and operating data pursuant to this Section. The financial
information and operating data to be provided pursuant to this Section may be set forth in full in one
or more documents or may be included by specific reference to any documents available to the
public on the MSRB's internet website or filed with the SEC.
(iii) Event Notices. The Issuer shall notify the MSRB,in a timely manner not in excess of
ten Business Days after the occurrence of the event,of any of the following events with respect to
the Bonds:
1. Principal and interest payment delinquencies;
2. Non-payment related defaults, if material;
3. Unscheduled draws on debt service reserves reflecting financial difficulties;
4. Unscheduled draws on credit enhancements reflecting financial difficulties;
5. Substitution of credit or liquidity providers,or their failure to perform;
6. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or
final determinations of taxability,Notices of Proposed Issue(IRS Form 5701-TEB)
or other material notices or determinations with respect to the tax status of the
Bonds,or other material events affecting the tax status of the Bonds;
7. Modifications to rights of holders of the Bonds, if material;
8. Bond calls, if material, and tender offers;
9. Defeasances;
10. Release, substitution, or sale of property securing repayment of the Bonds, if
material;
11. Rating changes;
12. Bankruptcy, insolvency, receivership or similar event of the Issuer;
13. The consummation of a merger,consolidation,or acquisition involving the Issuer or
the sale of all or substantially all of the assets ofthe Issuer,other than in the ordinary
course of business,the entry into a definitive agreement to undertake such an action
or the termination of a definitive agreement relating to any such actions,other than
pursuant to its terms, if material;
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14. Appointment of a successor Paying Agent/Registrar or change in the name of the
Paying Agent/Registrar, if material;
15. Incurrence of a Financial Obligation of the Issuer, if material, or agreement to
covenants, events of default, remedies, priority rights, or other similar terms of a
Financial Obligation of the Issuer, any of which affect security holders,if material;
and
16. Default, event of acceleration, termination event, modification of terms, or other
similar events under the terms of a Financial Obligation of the Issuer,any of which
reflect financial difficulties.
For these purposes, any event described in the immediately preceding paragraph (iii)12 is
considered to occur when any of the following occur. the appointment of a receiver,fiscal agent,
or similar officer for the Issuer in a proceeding under the United States Bankruptcy Code or in any
other proceeding under state or federal law in which a court or governmental authority has assumed
jurisdiction over substantially all of the assets or business of the Issuer, or if such jurisdiction has
been assumed by leaving the existing governing body and officials or officers of the Issuer in
possession but subject to the supervision and orders of a court or governmental authority, or the
entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or
governmental authority having supervision or jurisdiction over substantially all of the assets or
business of the Issuer.
The Issuer shall notify the MSRB,in a timely manner,of any failure by the Issuer to provide
the Annual Operating Report or Financial Statements in accordance with subsection (ii) of this
Section by the time required by subsection (ii).
(iv) Limitations, Disclaimers, and Amendments. (A) The Issuer shall be obligated to
observe and perform the covenants specified in this Section for so long as,but only for so long as,
the Issuer remains an"obligated person"with respect to the Bonds within the meaning of the Rule,
except that the Issuer in any event will give notice of any deposit made in accordance with this
Ordinance or applicable law that causes the Bonds no longer to be outstanding.
(B) The provisions of this Section are for the sole benefit of the registered owners and
beneficial owners of the Bonds, and nothing in this Section, express or implied, shall give any
benefit or any legal or equitable right,remedy,or claim hereunder to any other person. The Issuer
undertakes to provide only the financial information, operating data, financial statements, and
notices which it has expressly agreed to provide pursuant to this Section and does not hereby
undertake to provide any other information that may be relevant or material to a complete
presentation of the Issuer's financial results,condition, or prospects or hereby undertake to update
any information provided in accordance with this Section or otherwise,except as expressly provided
herein. The Issuer does not make any representation or warranty concerning such information or
its usefulness to a decision to invest in or sell Bonds at any future date.
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(C) UNDER NO CIRCUMSTANCES SHALL THE ISSUER BE LIABLE TO THE
REGISTERED OWNER OR BENEFICIAL OWNER OF ANY BOND OR ANY OTHER
PERSON,IN CONTRACT OR TORT,FOR DAMAGES RESULTING IN WHOLE OR IN PART
FROM ANY BREACH BY THE ISSUER,WHETHER NEGLIGENT OR WITHOUT FAULT ON
ITS PART,OF ANY COVENANT SPECIFIED IN THIS SECTION,BUT EVERY RIGHT AND
REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF
ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR
SPECIFIC PERFORMANCE.
(D) No default by the Issuer in observing or performing its obligations under this Section
shall comprise a breach ofor default under the Ordinance for purposes of any other provision ofthis
Ordinance. Nothing in this Section is intended or shall act to disclaim,waive,or otherwise limit the
duties of the Issuer under federal and state securities laws.
(E) The provisions of this Section may be amended by the Issuer from time to time to adapt
to changed circumstances that arise from a change in legal requirements, a change in law, or a
change in the identity,nature,status,or type of operations ofthe Issuer,but only if(1)the provisions
of this Section, as so amended,would have permitted an underwriter to purchase or sell Bonds in
the primary offering ofthe Bonds in compliance with the Rule,taking into account any amendments
or interpretations of the Rule since such offering as well as such changed circumstances and (2)
either(a)the registered owners of a majority in aggregate principal amount(or any greater amount
required by any other provision of this Ordinance that authorizes such an amendment) of the
outstanding Bonds consent to such amendment or(b)a person that is unaffiliated with the Issuer
(such as nationally recognized bond counsel)determined that such amendment will not materially
impair the interest of the registered owners and beneficial owners of the Bonds. If the Issuer so
amends the provisions of this Section, it shall include with any amended financial information or
operating data next provided in accordance with subsection(b)of this Section an explanation, in
narrative form, of the reason for the amendment and of the impact of any change in the type of
financial information or operating data so provided. The Issuer may also amend or repeal the
provisions of this continuing disclosure agreement if the SEC amends or repeals the applicable
provision ofthe Rule or a court of final jurisdiction enters judgment that such provisions ofthe Rule
are invalid, but only if and to the extent that the provisions of this sentence would not prevent an
underwriter from lawfully purchasing or selling Bonds in the primary offering of the Bonds.
(b) If the Bonds of a series are sold by private placement,the Pricing Officer may agree
to provide for an undertaking in accordance with the Rule or may agree to provide other public
information to the purchaser as may be necessary for the sale of the Bonds on the most favorable
terms to the Issuer.
Section 15. METHOD OF AMENDMENT. The Issuer hereby reserves the right to amend
this Ordinance subject to the following terms and conditions,to-wit:
(a) Amendment without Consent of Registered Owners. The Issuer may from time to time,
without the consent of any Registered Owner,except as otherwise required by paragraph(b)below,
amend or supplement this Ordinance to(i)cure any ambiguity,defect or omission in this Ordinance
that does not materially adversely affect the interests of the Registered Owners,(ii)grant additional
27
rights or security for the benefit of the Registered Owners,(iii)add events of default as shall not be
inconsistent with the provisions of this Ordinance and that shall not materially adversely affect the
interests of the Registered Owners,(v)qualify this Ordinance under the Trust Indenture Act of 1939,
as amended, or corresponding provisions of federal laws from time to time in effect,or(iv) make
such other provisions in regard to matters or questions arising under this Ordinance as shall not be
materially inconsistent with the provisions of this Ordinance and that shall not, in the opinion of
nationally-recognized bond counsel, materially adversely affect the interests of the Registered
Owners.
(b) Amendment with Consent of Registered Owners. Except as provided in paragraph(a)
above,the Registered Owners of a majority in aggregate principal amount and maturity amount(if
applicable)of the Bonds then outstanding that are the subject of a proposed amendment shall have
the right from time to time to approve any amendment hereto that may be deemed necessary or
desirable by the Issuer, provided, however, that without the consent of 100% of the Registered
Owners in aggregate principal amount and maturity amount(if applicable)of the then outstanding
Bonds,nothing herein contained shall permit or be construed to permit amendment of the terms and
conditions of this Ordinance or in any of the Bonds so as to:
(1) Make any change in the maturity of any of the outstanding Bonds;
(2) Reduce the rate of interest borne by any of the outstanding Bonds;
(3) Reduce the amount of the principal of, or redemption premium, if any, or
maturity amount(if applicable),payable on any outstanding Bonds;
(4) Modify the terms of payment of principal or of interest or redemption premium
on outstanding Bonds or any of them or impose any condition with respect to such
payment;or
(5) Change the minimum percentage of the principal amount or maturity amount(if
applicable)of the Bonds necessary for consent to such amendment.
(c) Notice of Amendment. If at any time the Issuer shall desire to amend this Ordinance
under this Section, the Issuer shall deliver to each Registered Owner of the affected Bonds a copy
of the proposed amendment.
(d) Receipt of Consent to Amendment. Whenever at any time within one year from the date
of giving of such notice the Issuer shall receive an instrument or instruments executed by the
Registered Owners of at least a majority in aggregate principal amount of all of the Bonds then
outstanding that are required for the amendment(or 100%if such amendment is made in accordance
with paragraph (b)), which instrument or instruments shall refer to the proposed amendment and
which shall specifically consent to and approve such amendment, the Issuer may adopt the
amendment in substantially the same form.
(e) Effect of Amendment. Upon the adoption of any amendatory Ordinance pursuant to the
provisions of this Section, this Ordinance shall be deemed to be modified and amended in
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accordance with such amendatory Ordinance, and the respective rights, duties,and obligations of
the Issuer and all Registered Owners of such affected Bonds shall thereafter be determined,
exercised, and enforced,subject in all respects to such amendment.
(f) Duration of Revocation of Consent. Any consent given by the Registered Owner of a
Bond pursuant to the provisions of this Section shall be irrevocable for a period of six months from
the date of such consent and shall be conclusive and binding upon all future Registered Owners of
the same Bond during such period. Such consent may be revoked at any time after six months from
the date of said consent by the Registered Owner who gave such consent,or by a successor in title,
by filing notice with the Issuer, but such revocation shall not be effective if the Registered Owners
the required amount ofthe affected Bonds then outstanding,have,prior to the attempted revocation,
consented to and approved the amendment.
(g) Reliance on Registration Bonds. For the purposes of establishing ownership of the
Bonds, the Issuer shall rely solely upon the registration of the ownership of such Bonds on the
Registration Books kept by the Paying Agent/Registrar.
Section 16. INVESTMENTS; SECURITY FOR FUNDS.
(a) Investment Earnings. Interest earnings derived from the investment of proceeds from
the sale of the Bonds issued to finance costs of the projects approved at the Election shall be used
for the purposes for which such Bonds are issued as set forth in Section 1 hereof;provided that after
completion of such purposes,if any of such interest earnings remain on hand,such interest earnings
shall be deposited in the Interest and Sinking Fund. It is further provided,however,that any interest
earnings on Bond proceeds which are required to be rebated to the United States of America
pursuant to Section 11 hereof in order to prevent the Bonds from being arbitrage bonds shall be so
rebated and not considered as interest earnings for the purposes of this Section.
(b) Authorized Investments. The Issuer may place proceeds of the Bonds issued to fmance
costs of the projects approved at the Election(including investment earnings thereon)and amounts
deposited into the Interest and Sinking Fund in investments authorized by the Public Funds
Investment Act,Chapter 2256,Texas Government Code,as amended; provided,however,that the
Issuer hereby covenants that the proceeds of the sale of such Bonds will be used as soon as
practicable for the purposes for which such Bonds are issued.
(c) Security for Funds. All deposits authorized or required by this Ordinance shall be
secured to the fullest extent required by law for the security of public funds.
Section 17. GOVERNING LAW. This Ordinance shall be construed and enforced in
accordance with the laws of the State of Texas and the United States of America.
Section 18. SEVERABILITY. If any provision of this Ordinance or the application thereof
to any circumstance shall be held to be invalid,the remainder of this Ordinance and the application
thereof to other circumstances shall nevertheless be valid,and this governing body hereby declares
that this Ordinance would have been enacted without such invalid provision.
29
Section 19. 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(an "Event of Default"):
(i)the failure to make payment of the principal of or interest on any of the Bonds when the
same becomes due and payable;or
(ii)default in the performance or observance of any other covenant,agreement or obligation
of the Issuer, the failure to perform which materially, adversely affects the rights of the
Registered 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 Registered Owner to the Issuer.
Section 20. REMEDIES FOR DEFAULT. (a) Upon the happening of any Event of Default,
then and in every case,any Registered Owner or an authorized representative thereof,including,but
not limited to, a trustee or trustees therefor, may proceed against the Issuer for the purpose of
protecting and enforcing the rights of the Registered Owners under this Ordinance,by mandamus
or other suit,action or special proceeding in equity or at law,in any court of competent jurisdiction,
for any relief permitted by law, including the specific performance of any covenant or agreement
contained herein, or thereby to enjoin any act or thing that may be unlawful or in violation of any
right of the Registered Owners hereunder or any combination of such remedies.
(b) It is provided that all such proceedings shall be instituted and maintained for the
equal benefit of all Registered Owners of Bonds then outstanding.
Section 21. 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 Bonds 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 Bonds 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.
(c) By accepting the delivery of a Bond authorized under this Ordinance, such Registered
Owner agrees that the certifications required to effectuate any covenants or representations
contained in this Ordinance do not and shall never constitute or give rise to a personal or pecuniary
liability or charge against the officers,employees or councilmembers of the Issuer or the Council.
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CERTIFICATE REGARDING ADOPTION OF ORDINANCE NO.2021-43
THE STATE OF TEXAS §
COUNTIES OF COLLIN AND DENTON §
TOWN OF PROSPER §
We,the undersigned officers of the Town,hereby certify as follows:
1. The Town Council of the Town convened in REGULAR MEETING ON THE 10TH DAY OF
AUGUST,2021,at the Town Hall,and the roll was called of the duly constituted officers and members of
the Town Council, to-wit:
Ray Smith,Mayor
Meigs Miller, Mayor Pro-Tem
Craig Andres,Deputy Mayor Pro-Tern
Amy Bartley
Charles Cotton
Jeff Hodges
Marcus E.Ray
Robyn Battle,Town Secretary
and all of said persons were present,except the following absentees: NONE ,thus
constituting a quorum. Whereupon,among other business,the following was transacted at said Meeting: a
written
ORDINANCE NO. 2021-43 APPROVING ALL MATTERS INCIDENT AND RELATED TO THE
ISSUANCE,SALE AND DELIVERY OF UP TO$40,000,000 IN PRINCIPAL AMOUNT OF"TOWN OF
PROSPER GENERAL OBLIGATION BONDS, SERIES 2021"; AUTHORIZING THE ISSUANCE OF
THE BONDS; DELEGATING THE AUTHORITY TO CERTAIN TOWN OFFICIALS TO EXECUTE
CERTAIN DOCUMENTS RELATING TO THE SALE OF THE BONDS; APPROVING AND
AUTHORIZING INSTRUMENTS AND PROCEDURES RELATING TO SAID BONDS; ENACTING
OTHER PROVISIONS RELATING TO THE SUBJECT; AND PROVIDING AN EFFECTIVE DATE
was duly introduced for the consideration of the Town Council.It was then duly moved and seconded that
said Ordinance be adopted and, after due discussion, said motion, carrying with it the adoption of said
Ordinance,prevailed and carried by the following vote:
AYES: All members of the Town Council shown present above voted"Aye,"except as shown below:
NOES: None ABSTAIN: None
2. That a true,full and correct copy of the aforesaid Ordinance adopted at the Meeting described in
the above and foregoing paragraph is attached to and follows this Certificate; that said Ordinance has been
duly recorded in said Town Council's minutes of said Meeting;that the above and foregoing paragraph is
a true,full and correct excerpt from the Town Council's minutes of said Meeting pertaining to the adoption
of said Ordinance;that the persons named in the above and foregoing paragraph are the duly chosen,qualified
and acting officers and members of the Town Council as indicated therein; that each of the officers and
members of the Town Council was duly and sufficiently notified officially and personally,in advance,of the
time, place and purpose of the aforesaid Meeting, and that said Ordinance would be introduced and
considered for adoption at said Meeting,and each of said officers and members consented,in advance,to the
holding of said Meeting for such purpose,and that said Meeting was open to the public and public notice of
the time, place and purpose of said meeting was given, all as required by Chapter 551, Texas Government
Code.
3.That the Mayor of the Town has approved and hereby approves the aforesaid Ordinance;that the
Mayor and the Town Secretary of the Town have duly signed said Ordinance;and that the Mayor and the
Town Secretary of the Town hereby declare that their signing of this Certificate shall constitute the signing
of the attached and following copy of said Ordinance for all purposes.
SIGNED and SEALED this, the 10th day of August, 2021.
/ullil, ' j.! it
•wn e :+. . OF PROS Mayor
[Seal] r�
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