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HomeMy WebLinkAboutDecember 4, 2014 Special Meeting Agenda Packet Final BOARD OF DIRECTORS Special Meeting Agenda-Amended** TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 100 MUNICIPAL DRIVE TROPHY CLUB, TEXAS 76262 December 4, 2014 4:00 P.M. Svore Municipal Boardroom CALL TO ORDER AND ANNOUNCE A QUORUM REGULAR SESSION 1. Consider and take appropriate action regarding all matters incident and related to the issuance and sale of Trophy Club Municipal Utility District No. 1 Unlimited Tax Bonds, Series 2014, in the amount of $5,765,000, including the adoption of Order No. 2014-1204A authorizing the issuance of such bonds. attachment: Order No. 2014-1204A 2. Consider and take appropriate action regarding all matters incident and related to authorizing appropriate personnel and consultants to proceed with arrangements and the preparation of documents for the issuance and sale of revenue bonds and approving and authorizing publication of a notice of sale with respect to such bonds, including the adoption of Resolution No. 2014-1204A pertaining thereto. attachment: Resolution No. 2014-1204A 3. Consider and take appropriate action to approve Resolution No. 2014-1204B to submit request to Texas Commission on Environmental Quality for extension of time for issuance of bonds for wastewater treatment plant improvements. attachment: Resolution No. 2014-1204B 4. Consider and take appropriate action to approve Amendment to the Agreement for Water Service Between the City of Fort Worth and the Trophy Club Municipal Utility District No. 1 for the Construction of a Northside II 48-inch Water Main and Allocated Capacity. attachment: Amendment to the Agreement for Water Service 5. Consider and take appropriate action to appoint committee of the Board of Directors to serve as Audit Committee for FY 2014 Annual Financial Audit. 6. Consider and take appropriate action to approve Order No. 2014-1204B setting District policy for public presentations. ** attachment: Order No. 2014-1204B ADJOURN Trophy Club Municipal Utility District No. 1 1 of 69 December 4, 2014 - Special Meeting *THE BOARD RESERVES THE RIGHT TO ADJOURN INTO A CLOSED SESSION AT ANY TIME DURING THE MEETING FOR THE PURPOSE OF SEEKING THE ADVICE OF ITS ATTORNEY ABOUT ANY ITEM ON THE AGENDA, PURSUANT TO SECTION 551.071 OF THE TEXAS GOVERNMENT CODE. CERTIFICATION THE STATE OF TEXAS § COUNTIES OF DENTON AND TARRANT § THIS CERTIFIES THAT ON NOVEMBER 25, 2014 BY 4 P.M. A COPY OF THE ABOVE NOTICE OF THE TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1, BOARD OF DIRECTORS SP E C I A L MEETING TO BE HELD ON THURSDAY, DECEMBER 4, 2014 AT 4 P.M., WAS POSTED ON THE FRONT WINDOW OF TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 ADMINISTRATION BUILDING LOCATED AT 100 MUNICIPAL DRIVE, TROPHY CLUB, TEXAS, WHICH IS A PLACE CONVENIENT TO THE PUBLIC WITHIN THE BOUNDARIES OF THE DISTRICT, AND A COPY WAS ALSO PROVIDED TO THE COUNTY CLERKS OF DENTON AND TARRANT COUNTIES TO BE POSTED ON THEIR WEBSITES OR AT A PLACE CONVENIENT TO THE PUBLIC PURSUANT TO SECTION 49.063 OF THE WATER CODE AND SECTION 551.054 OF THE OPEN MEETINGS ACT, CHAPTER 551 OF THE TEXAS GOVERNMENT CODE. LAURIE SLAGHT, DISTRICT SECRETARY Trophy Club Municipal Utility District No. 1 2 of 69 December 4, 2014 - Special Meeting ORDER NO. 2014-1204A AN ORDER authorizing the issuance of "Trophy Club Municipal Utility District No. 1 Unlimited Tax Bonds, Series 2014"; specifying the terms and features of said bonds; levying a continuing direct annual ad valorem tax for the payment of said bonds; resolving other matters incident and related to the issuance, sale, payment and delivery of said Bonds, including the approval and execution of a Paying Agent/Registrar Agreement and the approval and distribution of an Official Statement; and providing an effective date. WHEREAS, Trophy Club Municipal Utility District No. 1 (the "District") is a conservation and reclamation district, a body corporate and politic and governmental agency of the State of Texas, created as a municipal utility district pursuant to Article 16, Section 59, of the Texas Constitution by Order of the Texas Commission on Environmental Quality ("TCEQ"), the successor in interest to the Texas Water Commission (collectively, the "Commission"), and the District operates pursuant to Chapters 49 and 54 of the Texas Water Code, as amended (the "Act"); and WHEREAS, the District is the successor by merger and consolidation of Trophy Club Municipal Utility District No. 1 ("Prior TCMUD 1 ") and Trophy Club Municipal Utility District No. 2 ("Prior TCMUD 2" and with Prior TCMUD 1, the "Prior TCMUDs") pursuant to a consolidation election held in the District on May 9, 2009 (the "Consolidation Election") by which the District consolidated the Prior TCMUDs into the District and assumed all outstanding and voted but unissued bonds and taxes of the Prior TCMUDs; and WHEREAS, Prior TCMUD 2 was the successor by merger and consolidation of Denton County Municipal Utility District No. 2 ("Prior DCMUD 2") and Denton County Municipal Utility District No. 3 ("Prior DCMUD 3") pursuant to a consolidation election held on May 5, 1990; and WHEREAS, the District is authorized by the Act to purchase, construct, acquire, own, operate, maintain, repair, improve, or extend inside or outside its boundaries any and all works, improvements, facilities, plants, equipment and appliances necessary to accomplish the purposes of its creation, all in accordance with the Act; and WHEREAS, at an election held within and for Prior TCMUD 1 on October 7, 1975 (the "Prior TCMUD 1 Election"), Prior TCMUD 1 was authorized to issue the bonds of the District in the maximum aggregate principal amount of $12,344,217 for the purchase, acquisition and construction of a waterworks and sanitary sewer system and additions, extensions and improvements thereto for said District including necessary administrative facilities, and for the further purpose of the purchase, acquisition and construction of works, improvements, facilities, plants, equipment and appliances necessary for the drainage of lands within said District, and to provide for the payment of the principal of and interest on such bonds by the levy and collection of ad valorem taxes upon all taxable property within the District; and WHEREAS, at elections held within and for Prior DCMUD 3 on April 4, 1981 (the "Prior DCMUD 3 1981 Election") and on October 29, 1988 (the "Prior DCMUD 3 1988 Election"), Prior DC MUD 3 was authorized to issue the bonds of the District in the maximum principal amount of $5,800,000 and $2,500,000, respectively, for purchasing, constructing, acquiring, owning, operating, repairing, improving or extending a waterworks system, sanitary sewer system and drainage and storm sewer system, including, but not limited to, all additions to such systems 40660928.3111404702 Trophy Club Municipal Utility District No. 1 3 of 69 December 4, 2014 - Special Meeting and all works, improvements, facilities, plants, equipment, appliances, interests in property, and contract rights needed therefor and administrative facilities needed in connection therewith, and to provide for the payment of principal of and interest on such bonds by the levy and collection of a sufficient tax upon all taxable property within said District; and WHEREAS, the elections described above were called and held under and in strict conformity with the Constitution and laws of the State of Texas and of the United States of America, and the respective Boards of Directors of the Prior TCMUD 1 and the Prior DCMUD 3 have heretofore officially declared the results of said elections and declared that the Prior TCMUD 1 and the Prior DCMUD 3 were legally authorized to issue the bonds as described above; and WHEREAS, pursuant to the authority of the Prior TCMUD 1 Election, the District has heretofore issued $11,115,000 of its unlimited tax bonds for authorized purposes, and pursuant to the authority of the Prior DCMUD 3 1981 Election, the District has heretofore issued $3,760,000 of its unlimited tax bonds for authorized purposes; and WHEREAS, the District has not heretofore issued any bonds pursuant to the authority of the Prior DCMUD 3 1988 Election; and WHEREAS, there remains voted and unissued of the District's unlimited tax bonds, a total of $5,769,217 from the Consolidation Election of May 5, 1990, consisting of $1,229,217 from the voted authorization of Prior TCMUD 1 Election, $2,040,000 from the voted authorization of Prior DCMUD 3 1981 Election, and $2,500,000 from the voted authorization of the Prior DCMUD 3 1988 Election; and WHEREAS, the issuance of $5,765,000 in principal amount of Bonds pursuant to this Order will be from the original voted bond authorization of Prior TCMUD 1 Election, Prior DCMUD 3 1981 Election and Prior DCMUD 3 1988 Election, leaving voted and unissued, after the delivery of these bonds, $4,217 from the Prior TCMUD 1 Election, $0 from the Prior DCMUD 3 1981 Election, and $-0-from the Prior DCMUD 3 1988 Election; and WHEREAS, the Commission has approved the issuance by the District of up to $5,765,000 in unlimited tax bonds pursuant to an order dated February 6, 2014 (the "Commission Order") upon the terms and conditions stated in the Commission Order; and WHEREAS, the Board of the District deems it necessary and advisable at this time to issue $5,765,000 of bonds pursuant to the Act and the Prior TCMUD 1 Election, Prior DCMUD 3 1981 Election and Prior DCMUD 3 1988 Election as described above. NOW, THEREFORE, BE IT ORDERED BY THE BOARD OF DIRECTORS OF THE TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1: SECTION 1: Definitions and Interpretations. (a) When used in this Order, except in Section 12, and in any resolution or order amendatory or supplemental hereto, the terms listed below shall have the meanings specified below, unless it is otherwise expressly provided or unless the context otherwise requires: "Additional Bonds" shall mean the additional bonds payable from ad valorem taxes which the Board expressly reserves the right to issue in Section 32 of this Order. 40660928.3111404702 2 Trophy Club Municipal Utility District No. 1 4 of 69 December 4, 2014 - Special Meeting "Authorized Investments" shall mean authorized investments as set forth in the Public Funds Investment Act, Chapter 2256, Texas Government Code and the District's Investment Policy. "Board" or "Board of Directors" shall mean the governing body of the District. "Bondholders" or "Registered Owner" shall mean the registered owners of any Bonds. Any reference to a particular percentage or portion of the Bondholders shall mean the registered owners at the particular time of the specified percentage or portion in aggregate principal amount of all Bonds then outstanding exclusive of Bonds held by the District. "Bonds" shall mean the Bonds initially issued and delivered pursuant to this Order 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. "Order" shall mean this Order of the Board of Directors authorizing the issuance of the Bonds. "Commission" shall mean the Texas Commission on Environmental Quality or its successor. "Commission Order" shall mean the order of the Commission signed February 6, 2014 approving the issuance of the Bonds upon the terms and conditions as outlined in such order. "Designated Payment/Transfer Office" means (i) with respect to the initial Paying Agent/Registrar named herein, its designated office in St. Paul, Minnesota, and (ii) with respect to any successor Paying Agent/Registrar, the office of such successor designated and located as may be agreed upon by the District and such successor. "District" shall mean Trophy Club Municipal Utility District No. 1 and any other public agency succeeding to the powers, rights, privileges, and functions of the District, and shall mean, when appropriate, the Board of Directors of the District. "DTC" shall mean The Depository Trust Company of New York. "Fiscal Year" shall mean the twelve-month accounting period for the District, as may be changed from time to time by the Board of Directors. "Interest and Sinking Fund" shall mean the Interest and Sinking Fund created and established in Section 11 of this Order. "Interest Payment Date" shall mean a date on which interest on the Bonds is due and payable. Interest on the Bonds is due and payable on September 1, 2015, and semi-annually on each March 1 and September 1 thereafter until the earlier of maturity or redemption. "Paying Agent/Registrar" shall mean BOKF, NA dba Bank of Texas, Austin, Texas, and such other bank or trust company as may hereafter be appointed in substitution therefor or in addition thereto to perform the duties of Paying Agent/Registrar in accordance with this Order. "Project" shall mean the acquisition, construction and equipment of improvements to the District's wastewater treatment facilities. 40660928.3111404702 3 Trophy Club Municipal Utility District No. 1 5 of 69 December 4, 2014 - Special Meeting "Record Date" shall mean, with respect to each interest payment date, the 151h day of the month immediately preceding each Interest Payment Date, whether or not such date is a business day. "System" shall mean the works, improvements, facilities, plants, equipment, and appliances comprising the waterworks, sanitary sewer, and drainage system of the District now owned or to be hereafter purchased, constructed, or otherwise acquired whether by deed, contract, or otherwise, together with any additions or extensions thereto or improvements and replacements thereof. The titles and headings of the articles and sections of this Order have been inserted for convenience of reference only and are not to be considered a part hereof and shall not in any way modify or restrict any of the terms or provisions hereof. This Order and all the terms and provisions hereof shall be liberally construed to effectuate the purposes set forth herein and to sustain the validity of the Bonds and the validity of the lien on and pledge of the taxes pledged to the payment of the Bonds. SECTION 2: Authorization -Series Designation -Principal Amount-Purpose. Unlimited tax bonds of the District shall be and are hereby authorized to be issued in the aggregate principal amount of $5,765,000, to be designated and bear the title "TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 UNLIMITED TAX BONDS, SERIES 2014" (hereinafter referred to as the "Bonds") for (i) the following purposes, to wit: $1,225,000 for the purchase, acquisition and construction of a waterworks and sanitary sewer system and additions, extensions and improvements thereto for said District including necessary administrative facilities, and for the further purpose of the purchase, acquisition and construction of works, improvements, facilities, plants, equipment and appliances necessary for the drainage of lands within said District and $4,540,000 for purchasing, constructing, acquiring, owning, operating, repairing, improving or extending a waterworks system, sanitary sewer system and drainage and storm sewer system, including, but not limited to, all additions to such systems and all works, improvements, facilities, plants, equipment, appliances, interests in property, and contract rights needed therefor and administrative facilities needed in connection therewith, and (ii) paying the costs related to the issuance of the Bonds, pursuant to authority conferred by and in conformity with the Constitution and laws of the State of Texas, including Article XVI, Section 59 of the Texas Constitution and Texas Water Code, Chapters 49 and 54, as amended. SECTION 3: Fully Registered Obligations -Bond Date -Authorized Denominations- Stated Maturities -Interest Rates. The Bonds shall be issued as fully registered' obligations, shall be dated December 15, 2014 (the "Bond Date"), shall be in denominations of $5,000 or any integral multiple (within a Stated Maturity) thereof, and shall become due and payable on September 1 in each of the years and in principal amounts (the "Stated Maturities") and bear interest at the rate(s) per annum in accordance with the following schedule: 40660928.3111404702 4 Trophy Club Municipal Utility District No. 1 6 of 69 December 4, 2014 - Special Meeting YEAR OF STATED MATURITY 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 PRINCIPAL AMOUNT $235,000 240,000 245,000 250,000 255,000 265,000 270,000 280,000 290,000 295,000 305,000 315,000 325,000 335,000 345,000 360,000 370,000 385,000 400,000 INTEREST RATE(S) The Bonds shall bear interest on the unpaid principal amounts from the Bond Date at the rate(s) per annum shown above in this Section (calculated on the basis of a 360-day year of twelve 30-day months), and such interest shall be payable on March 1 and September 1 in each year, commencing September 1, 2015, until maturity or prior redemption. SECTION 4: Terms of Payment-Paying Agent/Registrar. The principal of, premium, if any, and the interest on the Bonds, due and payable by reason of maturity, redemption or otherwise, shall be payable only to the registered owners or holders of the Bonds (hereinafter called the "Holders") appearing on the registration and transfer books maintained by the Paying Agent/Registrar and the payment thereof shall be in any coin or currency of the United States of America, which at the time of payment is legal tender for the payment of public and private debts, and shall be without exchange or collection charges to the Holders. The selection and appointment of BOKF, NA dba Bank of Texas, Austin, Texas, to serve as Paying Agent/Registrar for the Bonds is hereby approved and confirmed. Books and records relating to the registration, payment, exchange and transfer of the Bonds (the "Security Register") shall at all times be kept and maintained on behalf of the District by the Paying Agent/Registrar, all as provided herein, in accordance with the terms and provisions of a "Paying Agent/Registrar Agreement", substantially in the form attached hereto as Exhibit A and such reasonable rules and regulations as the Paying Agent/Registrar and the District may prescribe. The President and Secretary of the Board of Directors are hereby authorized to execute and deliver such Agreement in connection with the delivery of the Bonds. The District covenants to maintain and provide a Paying Agent/Registrar at all times until the Bonds are paid and discharged, and any successor Paying Agent/Registrar shall be a bank, trust company, financial institution or other entity qualified and authorized to serve in such capacity and perform the duties and services of Paying Agent/Registrar. Upon any change in the Paying Agent/Registrar for the Bonds, the District agrees to promptly cause a written notice thereof to 40660928.3111404702 5 Trophy Club Municipal Utility District No. 1 7 of 69 December 4, 2014 - Special Meeting be sent to each Holder by United States Mail, first class postage prepaid, which notice shall also give the address of the new Paying Agent/Registrar. Principal of and premium, if any, on the Bonds shall be payable at the Stated Maturities or redemption thereof only upon presentation and surrender of the Bonds to the Paying Agent/Registrar at the Designated Payment/Transfer Office. Interest on the Bonds shall be paid to the Holder whose name appears in the Security Register at the close of business on the Record Date and shall be paid by the Paying Agent/Registrar (i) by check sent United States Mail, first class postage prepaid, to the address of the Holder recorded in the Security Register or (ii) by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the Holder. If the date for the payment of the principal of or interest on the Bonds shall be a Saturday, Sunday, a legal holiday, or a day when banking institutions in the city where the Designated Payment/Transfer Office of the 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 when 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. 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 District. 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 Holder appearing on the Security Register at the close of business on the last business day next preceding the date of mailing of such notice. SECTION 5: Redemption. (a) Optional Redemption. The Bonds maturing on and after September 1, 2025 shall be subject to redemption prior to maturity, at the option of the District, in whole or in part in principal amounts of $5,000 or any integral multiple thereof (and if within a Stated Maturity selected by lot by the Paying Agent/Registrar), September 1, 2024, or on any date thereafter at the redemption price of par plus accrued interest to the date of redemption. At least forty-five (45) days prior to a redemption date for the Bonds (unless a shorter notification period shall be satisfactory to the Paying Agent/Registrar), the District shall notify the Paying Agent/Registrar of the decision to redeem Bonds, the principal amount of each Stated Maturity to be redeemed, and the date of redemption therefor. The decision of the District to exercise the right to redeem Bonds shall be entered in the minutes of the governing body of the District. (b) Mandatorv Redemption. The Bonds maturing on September 1, 20_ and September 1, 20_ (the "Term Bonds") shall be subject to mandatory redemption prior to maturity at the price of par plus accrued interest to the mandatory redemption date on the respective dates and in principal amounts as follows: 40660928.3/11404702 6 Trophy Club Municipal Utility District No. 1 8 of 69 December 4, 2014 - Special Meeting Term Bonds due Redemption Date Principal Amount Term Bonds due Redemption Date Principal Amount Approximately forty-five (45) days prior to each mandatory redemption date for the Term Bonds, the Paying Agent/Registrar shall select by lot the numbers of the Term Bonds within the applicable Stated Maturity to be redeemed on the next following September 1 from moneys set aside for that purpose in the Interest and Sinking Fund (as hereinafter defined). Any Term Bonds not selected for prior redemption shall be paid on the date of their Stated Maturity. The principal amount of the Term Bonds for a Stated Maturity required to be redeemed on a mandatory redemption date may be reduced, at the option of the District, by the principal amount of Term Bonds of like Stated Maturity which, at least 50 days prior to the mandatory redemption date, (1) shall have been acquired by the District at a price not exceeding the principal amount of such Term Bonds plus accrued interest to the date of purchase thereof, and delivered to the Paying Agent/Registrar for cancellation or (2) shall have been redeemed pursuant to the optional redemption provisions set forth in paragraph (a) of this Section and not theretofore credited against a mandatory redemption requirement. (c) Selection of Bonds for Redemption. If less than all Outstanding Bonds of the same Stated Maturity are to be redeemed on a redemption date, the Paying Agent/Registrar shall treat such Bonds as representing the number of Bonds Outstanding which is obtained by dividing the principal amount of such Bonds by $5,000 and shall select the Bonds, or principal amount thereof, to be redeemed within such Stated Maturity by lot. (d) Notice of Redemption. Not less than thirty (30) days prior to a redemption date for the Bonds, a notice of redemption shall be sent by United States Mail, first class postage prepaid, in the name of the District and at the District's expense, to each Holder of a Bond to be redeemed in whole or in part at the address of the Holder appearing on the Security Register at the close of business on the business day next preceding the date of mailing such notice, and any notice of redemption so mailed shall be conclusively presumed to have been duly given irrespective of whether received by the Holder. All notices of redemption shall (i) specify the date of redemption for the Bonds, (ii) identify by number the Bonds to be redeemed and, in the case of a portion of the principal amount to be redeemed, the principal amount thereof to be redeemed, (iii) state the redemption price, (iv) state that the Bonds, or the portion of the principal amount thereof to be redeemed, shall become due and payable on the redemption date specified, and the interest thereon, or on the portion of the principal amount thereof to be redeemed, shall cease to accrue from and after the redemption date, and (v) specify that payment of the redemption price for the Bonds, or the principal amount thereof to be redeemed, shall be made at the Designated Payment/Transfer Office of the Paying Agent/Registrar only upon presentation and surrender thereof by the Holder. If a Bond is subject by its terms to prior redemption and has been called for redemption and notice of redemption thereof has been duly given as hereinabove provided, such Bond (or the principal amount thereof to be redeemed) shall become due and payable and interest thereon shall cease to accrue from and after the redemption date therefor; provided moneys sufficient for the payment of such Bond (or of the principal amount thereof to be redeemed) at 40660928.3/11404 702 7 Trophy Club Municipal Utility District No. 1 9 of 69 December 4, 2014 - Special Meeting the then applicable redemption price are held for the purpose of such payment by the Paying Agent/Registrar. (e) Conditional Notice of Redemption. With respect to any optional redemption of the Bonds, unless certain prerequisites to such redemption required by this Order have been met and moneys sufficient to pay the principal of and premium, if any, and interest on the Bonds to be redeemed shall have been received by the Paying Agent prior to the giving of such notice of redemption, such notice may state that said redemption is 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. If a conditional notice of redemption is given and such prerequisites to the redemption are not satisfied or sufficient moneys are not received, such notice shall be of no force and effect, the District 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 6: Registration -Transfer -Exchange of Bonds -Predecessor Bonds. The Paying Agent/Registrar shall obtain, record, and maintain in the Security Register the name and address of each and every owner of the Bonds issued under and pursuant to the provisions of this Order, or if appropriate the nominee thereof. Any Bond may be transferred or exchanged for Bonds of like maturity and amount and in authorized denominations by the Holder, in person or by his duly authorized agent, upon surrender of such Bond to the Designated Payment/Transfer Office of the Paying Agent/Registrar for cancellation, accompanied by a written instrument of transfer or request for exchange duly executed by the Holder or by his duly authorized agent, in form satisfactory to the Paying Agent/Registrar. Upon surrender of any Bond (except for the single Initial Bond hereinafter referenced) for transfer at the Designated Payment/Transfer Office of the Paying Agent/Registrar, one or more new Bonds shall be registered and issued to the assignee or transferee of the previous Holder; such Bonds to be in authorized denominations, of like Stated Maturity and of a like aggregate principal amount as the Bond or Bonds surrendered for transfer. At the option of the Holder, Bonds (except for the single Initial Bond hereinafter referenced) may be exchanged for other Bonds of authorized denominations and having the same Stated Maturity, bearing the same rate of interest and of like aggregate principal amount as the Bonds surrendered for exchange, upon surrender of the Bonds to be exchanged at the Designated Payment/Transfer Office of the Paying Agent/Registrar. Whenever any Bonds are surrendered for exchange, the Paying Agent/Registrar shall register and deliver new Bonds to the Holder requesting the exchange. All Bonds issued in any transfer or exchange of Bonds shall be delivered to the Holders at the Designated Payment/Transfer Office of the Paying Agent/Registrar or sent by United States Mail, first class, postage prepaid to the Holders, and, upon the registration and delivery thereof, the same shall be the valid obligations of the District, evidencing the same obligation to pay, and entitled to the same benefits under this Order, as the Bonds surrendered in such transfer or exchange. All transfers or exchanges of Bonds pursuant to this Section shall be made without expense or service charge to the Holders, except as otherwise herein provided, and except that the Paying Agent/Registrar shall require payment by the Holder requesting such transfer or exchange of any tax or other governmental charges required to be paid with respect to such transfer or exchange. 40660928.3111404702 8 Trophy Club Municipal Utility District No. 1 10 of 69 December 4, 2014 - Special Meeting Bonds cancelled by reason of an exchange or transfer pursuant to the provisions hereof are hereby defined to be "Predecessor Bonds," evidencing all or a portion, as the case may be, of the same obligation to pay evidenced by the new Bond or Bonds registered and delivered in the exchange or transfer therefor. Additionally, the term "Predecessor Bonds" shall include any mutilated, lost, destroyed, or stolen Bond for which a replacement Bond has been issued, registered and delivered in lieu thereof pursuant to the provisions of Section 13 hereof and such new replacement Bond shall be deemed to evidence the same obligation as the mutilated, lost, destroyed, or stolen Bond. Neither the District nor the Paying Agent/Registrar shall be required to issue or transfer to an assignee of a Holder any Bond called for redemption, in whole or in part, within 45 days of the date fixed for the redemption of such Bond; provided, however, such limitation on transferability shall not be applicable to an exchange by the Holder of the unredeemed balance of a Bond called for redemption in part. SECTION 7: Book-Entry-Only Transfers and Transactions. Notwithstanding the provisions contained in Sections 4, 5 and 6 hereof relating to the payment, redemption and transfer/exchange of the Bonds, the District hereby approves and authorizes the use of "Book Entry Only" securities clearance, settlement and transfer system provided by The Depository Trust Company (DTC), a limited purpose trust company organized under the laws of the State of New York, in accordance with the operational arrangements referenced in the Blanket Issuer Letter of Representations, by and between the District and DTC (the "Depository Agreement"). Pursuant to the Depository Agreement and the rules of DTC, the Bonds shall be deposited with DTC who shall hold said Bonds for its participants (the "DTC Participants"). While the Bonds are held by DTC under the Depository Agreement, the Holder of the Bonds on the Security Register for all purposes, including payment and notices, shall be Cede & Co., as nominee of DTC, notwithstanding the ownership of each actual purchaser or owner of each Bond (the "Beneficial Owners") being recorded in the records of DTC and DTC Participants. In the event DTC determines to discontinue serving as securities depository for the Bonds or otherwise ceases to provide book entry clearance and settlement of securities transactions in general or the District determines that DTC is incapable of properly discharging its duties as securities depository for the Bonds, the District covenants and agrees with the Holders of the Bonds to cause Bonds to be printed in definitive form and provide for the Bond certificates to be issued and delivered to DTC Participants and Beneficial Owners, as the case may be. Thereafter, the Bonds in definitive form shall be assigned, transferred and exchanged on the Security Register maintained by the Paying Agent/Registrar and payment of such Bonds shall be made in accordance with the provisions of Sections 4, 5 and 6 hereof. SECTION 8: Execution-Registration. The Bonds shall be executed on behalf of the District by the President or Vice President of the Board of Directors under its seal reproduced or impressed thereon and attested by the Secretary of the Board of Directors. The signature of said officers on the Bonds may be manual or facsimile. Bonds bearing the manual or facsimile signatures of individuals who are or were the proper officers of the Board on the date of adoption of this Order shall be deemed to be duly executed on behalf of the District, notwithstanding that such individuals or either of them shall cease to hold such offices at the time of delivery of the Bonds to the initial purchaser(s) and with respect to Bonds delivered in subsequent exchanges and transfers, all as authorized and provided in Texas Government Code, Chapter 1201, as amended. 40660928.3111404702 9 Trophy Club Municipal Utility District No. 1 11 of 69 December 4, 2014 - Special Meeting No Bond shall be entitled to any right or benefit under this Order, or be valid or obligatory for any purpose, unless there appears on such Bond either a certificate of registration substantially in the form provided in Section 10(c), manually executed by the Comptroller of Public Accounts of the State of Texas, or his duly authorized agent, or a certificate of registration substantially in the form provided in Section 1 0( d), manually executed by an authorized officer, employee or representative of the Paying Agent/Registrar, and either such certificate duly signed upon any Bond shall be conclusive evidence, and the only evidence, that such Bond has been duly certified, registered and delivered. SECTION 9: Initial Bond(s). The Bonds herein authorized shall be initially issued either (i) as a single fully registered bond in the total principal amount stated in Section 2 hereof with principal installments to become due and payable as provided in Section 3 hereof and numbered T-1, or (ii) as multiple fully registered bonds, being one bond for each year of maturity in the applicable principal amount and denomination and to be numbered consecutively from T-1 and upward (hereinafter called the "Initial Bond(s)") and, in either case, the Initial Bond(s) shall be registered in the name of the initial purchaser(s) or the designee thereof. The Initial Bond(s) shall be the Bonds submitted to the Office of the Attorney General of the State of Texas for approval, certified and registered by the Office of the Comptroller of Public Accounts of the State of Texas and delivered to the initial purchaser(s). Any time after the delivery of the Initial Bond(s), the Paying Agent/Registrar, pursuant to written instructions from the initial purchaser(s), or the designee thereof, shall cancel the Initial Bond(s) delivered hereunder and exchange therefor definitive Bonds of authorized denominations, Stated Maturities, principal amounts and bearing applicable interest rates for transfer and delivery to the Holders named at the addresses identified therefor; all pursuant to and in accordance with such written instructions from the initial purchaser(s), or the designee thereof, and such other information and documentation as the Paying Agent/Registrar may reasonably require. SECTION 10: Forms. (a) Forms Generally. The Bonds, the Registration Certificate of the Comptroller of Public Accounts of the State of Texas, the Registration Certificate of Paying Agent/Registrar, and the form of Assignment to be printed on each of the Bonds, shall be substantially in the forms set forth in this Section with such appropriate insertions, omissions, substitutions, and other variations as are permitted or required by this Order and may have such letters, numbers, or other marks of identification (including identifying numbers and letters of the Committee on Uniform Securities Identification Procedures of the American Bankers Association) and such legends and endorsements (including insurance legends on insured Bonds and any reproduction of an opinion of counsel) thereon as may, consistently herewith, be established by the District or determined by the officers executing such Bonds as evidenced by their execution. Any portion of the text of any Bonds may be set forth on the reverse thereof, with an appropriate reference thereto on the face of the Bond. The definitive Bonds and the Initial Bond(s) shall be printed, lithographed, or engraved, typewritten, photocopied or otherwise reproduced in any other similar manner, all as determined by the officers executing such Bonds as evidenced by their execution. 40660928.3111404702 10 Trophy Club Municipal Utility District No. 1 12 of 69 December 4, 2014 - Special Meeting (b) Form of Definitive Bonds. REGISTERED NO. __ _ Bond Date: December 15, 2014 Registered Owner: Principal Amount: UNITED STATES OF AMERICA STATE OF TEXAS REGISTERED PRINCIPAL AMOUNT $ ___ _ TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 UNLIMITED TAX BOND, SERIES 2014 Interest Rate: % --- Stated Maturity: September 1, 20 __ CUSIP NO: DOLLARS The Trophy Club Municipal Utility District No. 1 (hereinafter referred to as the "District"), a body corporate and political subdivision in the Counties of Denton and Tarrant, State of Texas, for value received, acknowledges itself indebted to and hereby promises to pay to the Registered Owner named above, or the registered assigns thereof, on the Stated Maturity date specified above (or so much thereof as shall not have been paid upon prior redemption) the Principal Amount hereinabove stated, and to pay interest on the unpaid principal amount hereof from the interest payment date next preceding the "Registration Date" of this Bond appearing below (unless this Bond bears a "Registration Date" as of an interest payment date, in which case it shall bear interest from such date, or unless the "Registration Date" of this Bond is prior to the initial interest payment date in which case it shall bear interest from the Bond Date) at the per annum rate of interest specified above computed on the basis of a 360-day year of twelve 30-day months; such interest being payable on March 1 and September 1 in each year, commencing September 1, 2015. Principal of this Bond is payable at its Stated Maturity or redemption to the registered owner hereof, upon presentation and surrender, at the Designated Payment/Transfer Office of the Paying Agent/Registrar executing the registration certificate appearing hereon, or its successor; provided, however, while this Bond is registered to Cede & Co., the payment of principal upon a partial redemption of the principal amount hereof may be accomplished without presentation and surrender of this Bond. Interest is payable to the registered owner of this Bond (or one or more Predecessor Bonds, as defined in the Order hereinafter referenced) whose name appears on the "Security Register" maintained by the Paying Agent/Registrar at the close of business on the "Record Date", which is the 151h day next preceding each interest payment date, and interest shall be paid by the Paying Agent/Registrar by check sent United States Mail, first class postage prepaid, to the address of the registered owner recorded in the Security Register or by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the registered owner. If the date for the payment of the principal of or interest on the Bonds shall be a Saturday, Sunday, a legal holiday, or a day when banking institutions in the city where the Designated Payment/Transfer Office of the 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 40660928.3111404702 11 Trophy Club Municipal Utility District No. 1 13 of 69 December 4, 2014 - Special Meeting day which is not such a Saturday, Sunday, legal holiday, or day when 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. All payments of principal of, premium, if any, and interest on this Bond shall be without exchange or collection charges to the owner or holder hereof and in any coin or currency of the United States of America which at the time of payment is legal tender for the payment of public and private debts. This Bond is one of the series specified in its title issued in the aggregate principal amount of $5,765,000 (herein referred to as the "Bonds") for (i) the following purposes, to wit: $1,225,000 for the purchase, acquisition and construction of a waterworks and sanitary sewer system and additions, extensions and improvements thereto for said District including necessary administrative facilities, and for the further purpose of the purchase, acquisition and construction of works, improvements, facilities, plants, equipment and appliances necessary for the drainage of lands within said District and $4,540,000 for purchasing, constructing, acquiring, owning, operating, repairing, improving or extending a waterworks system, sanitary sewer system and drainage and storm sewer system, including, but not limited to, all additions to such systems and all works, improvements, facilities, plants, equipment, appliances, interests in property, and contract rights needed therefor and administrative facilities needed in connection therewith, and (ii) paying the costs related to the issuance of the Bonds, under and in strict conformity with the Constitution and laws of the State of Texas, including Texas Water Code, Chapters 49 and 54, as amended, elections held for such purposes, and pursuant to an Order adopted by the Board of Directors of the District (herein referred to as the "Order"). The Bonds maturing on the dates identified below (the "Term Bonds") shall be subject to mandatory redemption prior to maturity with funds on deposit in the Interest and Sinking Fund established and maintained for the payment thereof in the Order, and shall be redeemed in part prior to maturity at the price of par plus accrued interest thereon to the mandatory redemption date on the respective dates and in the principal amounts as follows: Term Bonds due Redemption Date Principal Amount Term Bonds due Redemption Date Principal Amount The particular Term Bonds to be redeemed on each redemption date shall be chosen by lot by the Paying Agent/Registrar; provided, however, that the principal amount of Term Bonds for a Stated Maturity required to be redeemed on a mandatory redemption date may be reduced, at the option of the District, by the principal amount of Term Bonds of like maturity which, at least 50 days prior to the mandatory redemption date, (1) shall have been acquired by the District at a price not exceeding the principal amount of such Term Bonds plus accrued interest to the date of purchase thereof, and delivered to the Paying Agent/Registrar for cancellation or (2) shall have been redeemed pursuant to the optional redemption provisions appearing below and not theretofore credited against a mandatory redemption requirement. The Bonds maturing on and after September 1 , 2025 may be redeemed prior to their Stated Maturities, at the option of the District, Jn whole or in part in principal amounts of $5,000 or any integral multiple thereof (and if within a Stated Maturity selected by lot by the Paying Agent/Registrar), on September 1, 2024 or on any date thereafter at the redemption price of par, together with accrued interest to the date of redemption. 40660928.3111404702 12 Trophy Club Municipal Utility District No. 1 14 of 69 December 4, 2014 - Special Meeting At least thirty (30) days prior to a redemption date, the District shall cause a written notice of such redemption to be sent by United States Mail, first class postage prepaid, to the registered owners of the Bonds to be redeemed in whole or in part, and subject to the terms and provisions relating thereto contained in the Order. If a Bond (or any portion of its principal sum) shall have been duly called for redemption and notice of such redemption duly given, then upon such redemption date such Bond (or the portion of its principal sum to be redeemed) shall become due and payable, and interest thereon shall cease to accrue from and after the redemption date therefor, provided moneys for the payment of the redemption price and the interest on the principal amount to be redeemed to the date of redemption are held for the purpose of such payment by the Paying Agent/Registrar. With respect to any optional redemption of the Bonds, unless certain prerequisites to such redemption required by the Order have been met and moneys sufficient to pay the principal of and premium, if any, and interest on the Bonds to be redeemed shall have been received by the Paying Agent/Registrar prior to the giving of such notice of redemption, such notice may state that said redemption is 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. If a conditional notice of redemption is given and such prerequisites to the redemption are not satisfied or sufficient moneys are not received, such notice shall be of no force and effect, the District 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. In the event a portion of the principal amount of a Bond is to be redeemed and the registered owner hereof is someone other than Cede & Co., payment of the redemption price of such principal amount shall be made to the registered owner only upon presentation and surrender of this Bond to the Designated Payment/Transfer Office of the Paying Agent/Registrar, and a new Bond or Bonds of like maturity and interest rate in any authorized denominations provided by the Order for the then unredeemed balance of the principal sum thereof will be issued to the registered owner, without charge. If a Bond is selected for redemption, in whole or in part, the District and the Paying Agent/Registrar shall not be required to transfer such Bond to an assignee of the registered owner within 45 days of the redemption date therefor; provided, however, such limitation on transferability shall not be applicable to an exchange by the registered owner of the unredeemed balance of a Bond redeemed in part. The Bonds are payable (until all the territory within the District is annexed, all properties and assets of the District are taken over, and all debts, liabilities and obligations of the District, including this Bond, are assumed by one or more cities and the District is abolished pursuant to the laws of the State of Texas) from the proceeds of an ad valorem tax levied, without limit as to rate or amount, upon all taxable property in the District. The District covenants to levy a continuing direct annual ad valorem tax, without legal limit as to rate or amount, on all taxable property within the District, for each year while any part of the Bonds are considered outstanding under the provisions of the Order, in sufficient amount, together with revenues and receipts available from other sources which are available for such purposes, to pay interest on the Bonds as it becomes due, to provide a sinking fund for the payment of the principal of the Bonds when due or the redemption price at any earlier required redemption date with respect to the Bonds, and to pay the expenses of assessing and collecting such tax, all as more specifically provided in the Order. Reference is hereby made to the Order, a copy of which is on file in the Designated Payment/Transfer Office of the Paying Agent/Registrar, and to all of the provisions of which the owner or holder of this Bond by the acceptance hereof hereby assents, for definitions of terms; the description of and the nature and extent of the tax levied for the 40660928.3111404702 13 Trophy Club Municipal Utility District No. 1 15 of 69 December 4, 2014 - Special Meeting payment of the Bonds; the terms and conditions relating to the transfer or exchange of this Bond; the conditions upon which the Order may be amended or supplemented with or without the consent of the Holders; the rights, duties, and obligations of the District and the Paying Agent/Registrar; the terms and provisions upon which this Bond may be discharged at or prior to its maturity, and deemed to be no longer Outstanding thereunder; and for other terms and provisions contained therein. Capitalized terms used herein have the meanings assigned in the Order. No other entity, including the State of Texas, any political subdivision thereof other than the District, or any other public or private body, is obligated, directly, indirectly, contingently, or in any other manner, to pay the principal of or the interest on this Bond from any source whatsoever. No part of the physical properties of the District, including the properties provided by the proceeds of the Bonds of the series of which this Bond is a part, is encumbered by any lien for the benefit of the Registered Owner of this Bond. This Bond, subject to certain limitations contained in the Order, may be transferred on the Security Register only upon its presentation and surrender at the Designated Payment/Transfer Office of the Paying Agent/Registrar, with the Assignment hereon duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Paying Agent/Registrar duly executed by, the registered owner hereof, or his duly authorized agent. When a transfer on the Security Register occurs, one or more new fully registered Bonds of the same Stated Maturity, of authorized denominations, bearing the same rate of interest, and of the same aggregate principal amount will be issued by the Paying Agent/Registrar to the designated transferee or transferees. The District and the Paying Agent/Registrar, and any agent of either, shall treat the registered owner whose name appears on the Security Register (i) on the Record Date as the owner entitled to payment of interest hereon, (ii) on the date of surrender of this Bond as the owner entitled to payment of principal at the Stated Maturity, or its redemption, in whole or in part, and (iii) on any other date as the owner for all other purposes, and neither the District nor the Paying Agent/Registrar, or any agent of either, shall be affected by notice to the contrary. In the event of 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 District. 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 Holder of a Bond appearing on the Security Register at the close of business on the last business day next preceding the date of mailing of such notice. It is hereby certified, recited, represented and declared that the District is a body corporate and political subdivision duly organized and legally existing under and by virtue of the Constitution and laws of the State of Texas; that the issuance of the Bonds is duly authorized by law; that all acts, conditions and things required to exist and be done precedent to and in the issuance of the Bonds to render the same lawful and valid obligations of the District have been properly done, have happened and have been performed in regular and due time, form and manner as required by the Constitution and laws of the State of Texas, and the Order; that the Bonds do not exceed any Constitutional or statutory limitation; and that due provision has been made for the payment of the principal of and interest on the Bonds by the levy of a tax as aforestated. In case any provision in this Bond shall be invalid, illegal, or unenforceable, the 40660928.3111404702 14 Trophy Club Municipal Utility District No. 1 16 of 69 December 4, 2014 - Special Meeting validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. The terms and provisions of this Bond and the Order shall be construed in accordance with and shall be governed by the laws of the State of Texas. IN WITNESS WHEREOF, the Board of Directors of the District has caused this Bond to be duly executed under the official seal of the District. ATTEST: Secretary, Board of Directors (SEAL) TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 President, Board of Directors (c) Form of Registration Certificate of Comptroller of Public Accounts to appear on Initial Bond(s) only. REGISTRATION CERTIFICATE OF COMPTROLLER OF PUBLIC ACCOUNTS OFFICE OF THE COMPTROLLER OF PUBLIC ACCOUNTS THE STATE OF TEXAS ( ( ( REGISTER NO. ----- 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 duly registered by the Comptroller of Public Accounts of the State of Texas. WITNESS my signature and seal of office this __________ , (SEAL) 40660928.3111404702 15 Comptroller of Public Accounts of the State of Texas Trophy Club Municipal Utility District No. 1 17 of 69 December 4, 2014 - Special Meeting (d) Form of Certificate of Paying Agent/Registrar to appear on Definitive Bonds only. REGISTRATION CERTIFICATE OF PAYING AGENT/REGISTRAR This Bond has been duly issued and registered under the provisions of the within-mentioned Order; the bond or bonds of the above entitled and designated series originally delivered having been approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts, as shown by the records of the Paying Agent/Registrar. The designated offices of the Paying Agent/Registrar in St. Paul, Minnesota, is the Designated Payment/Transfer Office for this Bond. Registration date: (e) Form of Assignment. BOKF, NA dba Bank of Texas, Austin, Texas, as Paying Agent/Registrar By __________________________ _ Authorized Signature ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sells, assigns, and transfers unto (Print or typewrite name, address, and zip code of transferee): ----------- (Social Security or other identifying number: ------------------ -:-----:-:----:-----:----:--:----) the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints--------------------- attorney to transfer the within Bond on the books kept for registration thereof, with full power of substitution in the premises. DATED: __________________ __ Signature guaranteed: 40660928.3111404702 16 NOTICE: The signature on this assignment must correspond with the name of the registered owner as it appears on the face of the within Bond in every particular. Trophy Club Municipal Utility District No. 1 18 of 69 December 4, 2014 - Special Meeting (f) The Initial Bond(s) shall be in the form set forth in paragraph (b) of this Section, except that the form of the single fully registered Initial Bond shall be modified as follows: REGISTERED NO. T-1 UNITED STATES OF AMERICA STATE OF TEXAS REGISTERED PRINCIPAL AMOUNT $5,765,000 TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 UNLIMITED TAX BOND, SERIES 2014 Bond Date: December 15, 2014 Registered Owner: Principal Amount: FIVE MILLION SEVEN HUNDRED SIXTY-FIVE THOUSAND DOLLARS The Trophy Club Municipal Utility District No. 1 (hereinafter referred to as the "District"), a body corporate and political subdivision in the Denton and Tarrant Counties, State of Texas, for value received, acknowledges itself indebted to and hereby promises to pay to the Registered Owner named above, or the registered assigns thereof, the Principal Amount hereinabove stated on September 1 in each of the years and in principal installments in accordance with the following schedule: YEAR OF MATURITY PRINCIPAL INSTALLMENTS INTEREST RATE (Information to be inserted from schedule in Section 2 hereof). (or so much principal thereof as shall not have been prepaid prior to maturity) and to pay interest on the unpaid principal installments hereof from the Bond Date at the per annum rates of interest specified above computed on the basis of a 360-day year of twelve 30-day months; such interest being payable on March 1 and September 1 in each year, commencing September 1, 2015. Principal installments of this Bond are payable in the year of maturity or on a redemption date to the registered owner hereof by BOKF, NA dba Bank of Texas, Austin, Texas (the "Paying Agent/Registrar'), upon presentation and surrender, at its designated offices in St. Paul, Minnesota (the "Designated Payment/Transfer Office"). Interest is payable to the registered owner of this Bond whose name appears on the "Security Register" maintained by the Paying Agent/Registrar at the close of business on the "Record Date", which is the 151h day next preceding each interest payment date, and interest shall be paid by the Paying Agent/Registrar by check sent United States Mail, first class postage prepaid, to the address of the registered owner recorded in the Security Register or by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the registered owner. 40660928.3111404702 17 Trophy Club Municipal Utility District No. 1 19 of 69 December 4, 2014 - Special Meeting SECTION 11: Levy of Taxes. To provide for the payment of Bonds, there is hereby levied, and there shall be annually assessed and collected in due time, form, and manner, a tax on all taxable property in the District, without limit as to rate or amount, sufficient to pay the principal of and interest on the Bonds as the same becomes due and payable; and such tax hereby levied on each one hundred dollars' valuation of taxable property in the District for the payment of the Bonds shall be at a rate from year to year as will be ample and sufficient to provide funds each year to pay the principal of and interest on said Bonds while Outstanding; full allowance being made for delinquencies and costs of collection. The taxes levied, assessed, and collected for and on account of the Bonds shall be accounted for separate and apart from all other funds of the District and the taxes assessed and collected for the Bonds shall be deposited in the "Special Series 2014 Unlimited Tax Bond Fund" (hereinafter called the "Interest and Sinking Fund") to be maintained at an official depository of the District's funds; and such taxes hereby levied, and to be assessed and collected annually, for the Bonds are hereby pledged to the payment of the Bonds. In determining the rate of tax to be levied, assessed and collected, the District may take into account the amount in the Interest and Sinking Fund from the deposit of Bond proceeds on deposit in said fund for the payment of interest and whether the District reasonably expects to have revenue or receipts available from other sources which are legally available to pay debt service on the Bonds. The President, Vice President and Secretary of the Board of Directors, the General Manager and the Finance Manager of the District, individually or jointly, are hereby authorized and directed to cause to be transferred to the Paying Agent/Registrar for the Bonds, from funds on deposit in the Interest and Sinking Fund, amounts sufficient to fully pay and discharge promptly each installment of interest and principal of the Bonds as the same shall become payable or matures; such transfers to be made in such manner as will cause collected funds to be deposited with the Paying Agent/Registrar on or before each principal and interest payment date for the Bonds. SECTION 12: Consolidation and Dissolution of District. To the extent provided by law, the pledge of taxes set forth in Section 11 hereof will terminate if one or more cities takes over all properties and assets, assumes all debts, liabilities, and obligations, and performs all functions and services of the District, and the District is abolished pursuant to law. The laws of the State of Texas permit the District to be consolidated with one or more conservation and reclamation districts. In the event the District is consolidated with another district or districts, the District reserves the right to: (a) Consolidate the System with a similar system of one or more districts with which the District is consolidating and operate and maintain the systems as one consolidated system (herein for purposes of this section the "Consolidated System"). (b) Apply the net revenues from the operation of the Consolidated System to the payment of principal, interest, redemption price and bank charges on the revenue bonds or the combination tax and revenue bonds (herein for purposes of this section the "Revenue Bonds") of the District and of the district or districts with which the District is consolidating (herein collectively the "Consolidating Districts") without preference to any series of bonds (except subordinate lien revenue bonds which shall continue to be subordinate to the first lien Revenue Bonds of the Consolidating Districts). (c) Pledge the net revenues of the Consolidated System to the payment of principal, interest, redemption price and bank charges on Revenue Bonds which may be issued by the 40660928.3/11404702 18 Trophy Club Municipal Utility District No. 1 20 of 69 December 4, 2014 - Special Meeting Consolidating Districts on a parity with the outstanding first lien Revenue Bonds of the Consolidating Districts. SECTION 13: Mutilated. Destroyed. Lost and Stolen Bonds. In case any Bond shall be mutilated, or destroyed, lost or stolen, the Paying Agent/Registrar may execute and deliver a replacement Bond of like form and tenor, and in the same denomination and bearing a number not contemporaneously outstanding, in exchange and substitution for such mutilated Bond; and with respect to a lost, destroyed or stolen Bond a replacement Bond may be issued only upon the approval of the District and after (i) the filing by the Holder with the Paying Agent/Registrar of evidence satisfactory to the Paying Agent/Registrar of the destruction, loss or theft of such Bond, and of the authenticity of the ownership thereof and (ii) the furnishing to the Paying Agent/Registrar of indemnification in an amount satisfactory to hold the District and the Paying Agent/Registrar harmless. All expenses and charges associated with such indemnity and with the preparation, execution and delivery of a replacement Bond shall be borne by the Holder of the Bond mutilated, or destroyed, lost or stolen. Every replacement Bond issued pursuant to this Section shall be a valid and binding obligation, and shall be entitled to all the benefits of this Order equally and ratably with all other Outstanding Bonds; notwithstanding the enforceability of payment by anyone of the destroyed, lost, or stolen Bonds. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement and payment of mutilated, destroyed, lost or stolen Bonds. SECTION 14: Satisfaction of Obligation of District. If the District shall pay or cause to be paid, or there shall otherwise be paid to the Holders, the principal of, premium, if any, and interest on the Bonds, at the times and in the manner stipulated in this Order, then the pledge of taxes levied under this Order and all covenants, agreements, and other obligations of the District to the Holders shall thereupon cease, terminate, and be discharged and satisfied. Bonds or any principal amount(s) thereof shall be deemed to have been paid within the meaning and with the effect expressed above in this Section when (i) money sufficient to pay in full such Bonds or the principal amount(s) thereof at maturity or to the redemption date therefor, together with all interest due thereon, shall have been irrevocably deposited with and held in trust by the Paying Agent/Registrar, or an authorized escrow agent, or (ii) Government Securities shall have been irrevocably deposited in trust with the Paying Agent/Registrar, or an authorized escrow agent, which Government Securities have been certified by an independent accounting firm to mature as to principal and interest in such amounts and at such times as will insure the availability, without reinvestment, of sufficient money, together with any moneys deposited therewith, if any, to pay when due the principal of and interest on such Bonds, or the principal amount(s) thereof, on and prior to the Stated Maturity thereof or (if notice of redemption has been duly given or waived or if irrevocable arrangements therefor acceptable to the Paying Agent/Registrar have been made) the redemption date thereof. The District covenants that no deposit of moneys or Government Securities will be made under this Section and no use made of any such deposit which would cause the Bonds to be treated as "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, or regulations adopted pursuant thereto. Any moneys so deposited with the Paying Agent/Registrar, or an authorized escrow agent, and all income from Government Securities held in trust by the Paying Agent/Registrar, 40660928.3111404702 19 Trophy Club Municipal Utility District No. 1 21 of 69 December 4, 2014 - Special Meeting or an authorized escrow agent, pursuant to this Section which is not required for the payment of the Bonds, or any principal amount(s) thereof, or interest thereon with respect to which such moneys have been so deposited shall be remitted to the District or deposited as directed by the District. Furthermore, any money held by the Paying Agent/Registrar for the payment of the principal of and interest on the Bonds and remaining unclaimed for a period of three (3) years after the Stated Maturity, or applicable redemption date, of the Bonds such moneys were deposited and are held in trust to pay shall upon the request of the District be remitted to the District against a written receipt therefor. Notwithstanding the above and foregoing, any remittance of funds from the Paying Agent/Registrar to the District shall be subject to any applicable unclaimed property laws of the State of Texas. The term "Government Securities", as used herein, shall mean (i) direct noncallable obligations of the United States of America, including obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, (ii) noncallable obligations of an agency or instrumentality of the United States, including obligations unconditionally guaranteed or insured by the agency or instrumentality and on the date of their acquisition or purchase by the District are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent, (iii) noncallable obligations of a state or an agency or a county, municipality, or other political subdivision of a state that have been refunded and on the date of their acquisition or purchase by the District, are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent, and (iv) any other then authorized securities or obligations under applicable law that may be used to defease obligations such as the Bonds. SECTION 15: Order a Contract -Amendments -Outstanding Bonds. This Order shall constitute a contract with the Holders from time to time, be binding on the District, and shall not be amended or repealed by the District so long as any Bond remains Outstanding except as permitted in this Section and in Section 31 hereof. The District may, without the consent of or notice to any Holders, from time to time and at any time, amend this Order in any manner not detrimental to the interests of the Holders, including the curing of any ambiguity, inconsistency, or formal defect or omission herein. In addition, the District may, with the written consent of Holders holding a majority in aggregate principal amount of the Bonds then Outstanding affected thereby, amend, add to, or rescind any of the provisions of this Order; provided that, without the consent of all Holders of Outstanding Bonds, no such amendment, addition, or rescission shall (1) extend the time or times of payment of the principal of, premium, if any, and interest on the Bonds, reduce the principal amount thereof, the redemption price therefor, or the rate of interest thereon, or in any other way modify the terms of payment of the principal of, premium, if any, or interest on the Bonds, (2) give any preference to any Bond over any other Bond, or (3) reduce the aggregate principal amount of Bonds required to be held by Holders for consent to any such amendment, addition, or rescission. The term "Outstanding" when used in this Order with respect to Bonds means, as of the date of determination, all Bonds theretofore issued and delivered under this Order, except: (1) those Bonds cancelled by the Paying Agent/Registrar or delivered to the Paying Agent/Registrar for cancellation; (2) those Bonds deemed to be duly paid by the District in accordance with the provisions of Section 14 hereof; and 40660928.3111404 702 20 Trophy Club Municipal Utility District No. 1 22 of 69 December 4, 2014 - Special Meeting (3) those mutilated, destroyed, lost, or stolen Bonds which have been replaced with Bonds registered and delivered in lieu thereof as provided in Section 13 hereof. SECTION 16: Covenants to Maintain Tax-Exempt Status. (a) Definitions. When used in this Section, the following terms shall have the following meanings: "Closing Date" means the date on which the Bonds are first authenticated and delivered to the initial purchasers against payment therefor. "Code" means the Internal Revenue Code of 1986, as amended by all legislation, if any, effective on or before the Closing Date. "Computation Date" has the meaning set forth in Section 1.148-1 (b) of the Regulations. "Gross Proceeds" means any proceeds as defined in Section 1.148-1 (b) of the Regulations, and any replacement proceeds as defined in Section 1.148-1(c) of the Regulations, of the Bonds. "Investment" has the meaning set forth in Section 1.148-1 (b) of the Regulations. "Nonpurpose Investment" means any investment property, as defined in section 148(b) of the Code, in which Gross Proceeds of the Bonds are invested and which is not acquired to carry out the governmental purposes of the Bonds. "Rebate Amount" has the meaning set forth in Section 1.148-1 (b) of the Regulations. "Regulations" means any proposed, temporary, or final Income Tax Regulations issued pursuant to Sections 103 and 141 through 150 of the Code, and 103 of the Internal Revenue Code of 1954, which are applicable to the Bonds. Any reference to any specific Regulation shall also mean, as appropriate, any proposed, temporary or final Income Tax Regulation designed to supplement, amend or replace the specific Regulation referenced. "Yield" of ( 1) any Investment has the meaning set forth in Section 1.148- 5 of the Regulations and {2) the Bonds has the meaning set forth in Section 1.148-4 of the Regulations. (b) Not to Cause Interest to Become Taxable. The District shall not use, permit the use of, or omit to use Gross Proceeds or any other amounts (or any property the acquisition, construction or improvement of which is to be financed directly or indirectly with Gross Proceeds) in a manner which, if made or omitted, respectively, would cause interest on any Bond to become includable in the gross income, as defined in section 61 of the Code, of the owner thereof for federal income tax purposes. Without limiting the generality of the foregoing, unless and until the District receives a written opinion of counsel nationally recognized in the field of municipal bond law to the effect that failure to comply with such covenant will not 40660928.3111404702 21 Trophy Club Municipal Utility District No. 1 23 of 69 December 4, 2014 - Special Meeting adversely affect the exemption from federal income tax of the interest on any Bond, the District shall comply with each of the specific covenants in this Section. (c) No Private Use or Private Payments. Except as permitted by section 141 of the Code and the Regulations and rulings thereunder, the District shall at all times prior to the last Stated Maturity of Bonds: (1) exclusively own, operate and possess all property the acquisition, construction or improvement of which is to be financed or refinanced directly or indirectly with Gross Proceeds of the Bonds, and not use or permit the use of such Gross Proceeds (including all contractual arrangements with terms different than those applicable to the general public) or any property acquired, constructed or improved with such Gross Proceeds in any activity carried on by any person or entity (including the United States or any agency, department and instrumentality thereof) other than a state or local government, unless such use is solely as a member of the general public; and (2) not directly or indirectly impose or accept any charge or other payment by any person or entity who is treated as using Gross Proceeds of the Bonds or any property the acquisition, construction or improvement of which is to be financed or refinanced directly or indirectly with such Gross Proceeds, other than taxes of general application within the District or interest earned on investments acquired with such Gross Proceeds pending application for their intended purposes. (d) No Private Loan. Except to the extent permitted by section 141 of the Code and the Regulations and rulings thereunder, the District shall not use Gross Proceeds of the Bonds to make or finance loans to any person or entity other than a state or local government. For purposes of the foregoing covenant, such Gross Proceeds are considered to be "loaned" to a person or entity if: (1) property acquired, constructed or improved with such Gross Proceeds is sold or leased to such person or entity in a transaction which creates a debt for federal income tax purposes; (2) capacity in or service from such property is committed to such person or entity under a take-or-pay, output or similar contract or arrangement; or (3) indirect benefits, or burdens and benefits of ownership, of such Gross Proceeds or any property acquired, constructed or improved with such Gross Proceeds are otherwise transferred in a transaction which is the economic equivalent of a loan. (e) Not to Invest at Higher Yield. Except to the extent permitted by section 148 of the Code and the Regulations and rulings thereunder, the District shall not at any time prior to the final Stated Maturity of the Bonds directly or indirectly invest Gross Proceeds in any Investment (or use Gross Proceeds to replace money so invested), if as a result of such investment the Yield from the Closing Date of all Investments acquired with Gross Proceeds (or with money replaced thereby), whether then held or previously disposed of, exceeds the Yield of the Bonds. (f) Not Federally Guaranteed. Except to the extent permitted by section 149(b) of the Code and the Regulations and rulings thereunder, the District shall not take or omit to take any action which would cause the Bonds to be federally guaranteed within the meaning of section 149(b) of the Code and the Regulations and rulings thereunder. 40660928.3111404702 22 Trophy Club Municipal Utility District No. 1 24 of 69 December 4, 2014 - Special Meeting (g) Information Report. The District shall timely file the information required by section 149(e) of the Code with the Secretary of the Treasury on Form 8038-G or such other form and in such place as the Secretary may prescribe. (h) Rebate of Arbitrage Profits. Except to the extent otherwise provided in section 148(f) of the Code and the Regulations and rulings thereunder: (1) The District shall account for all Gross Proceeds (including all receipts, expenditures and investments thereof) on its books of account separately and apart from all other funds (and receipts, expenditures and investments thereof) and shall retain all records of accounting for at least six years after the day on which the last Outstanding Bond is discharged. However, to the extent permitted by law, the District may commingle Gross Proceeds of the Bonds with other money of the District, provided that the District separately accounts for each receipt and expenditure of Gross Proceeds and the obligations acquired therewith. (2) Not less frequently than each Computation Date, the District shall calculate the Rebate Amount in accordance with rules set forth in section 148(f) of the Code and the Regulations and rulings thereunder. The District shall maintain such calculations with its official transcript of proceedings relating to the issuance of the Bonds until six years after the final Computation Date. (3) As additional consideration for the purchase of the Bonds by the Purchasers and the loan of the money represented thereby and in order to induce such purchase by measures designed to insure the excludability of the interest thereon from the gross income of the owners thereof for federal income tax purposes, the District shall pay to the United States from the construction fund, other appropriate fund, or if permitted by applicable Texas statute, regulation or opinion of the Attorney General of the State of Texas, the Interest and Sinking Fund, the amount that when added to the future value of previous rebate payments made for the Bonds equals (i) in the case of a Final Computation Date as defined in Section 1.148-3(e)(2) of the Regulations, one hundred percent (100%) of the Rebate Amount on such date; and (ii) in the case of any other Computation Date, ninety percent (90%) of the Rebate Amount on such date. In all cases, the rebate payments shall be made at the times, in the installments, to the place and in the manner as is or may be required by section 148(f) of the Code and the Regulations and rulings thereunder, and shall be accompanied by Form 8038-T or such other forms and information as is or may be required by Section 148(f) of the Code and the Regulations and rulings thereunder. (4) The District shall exercise reasonable diligence to assure that no errors are made in the calculations and payments required by paragraphs (2) and (3), and if an error is made, to discover and promptly correct such error within a reasonable amount of time thereafter (and in all events within one hundred eighty (180) days after discovery of the error), including payment to the United States of any additional Rebate Amount owed to it, interest thereon, and any penalty imposed under Section 1.148-3(h) of the Regulations. 40660928.311 1404702 23 Trophy Club Municipal Utility District No. 1 25 of 69 December 4, 2014 - Special Meeting (i) Not to Divert Arbitrage Profits. Except to the extent permitted by section 148 of the Code and the Regulations and rulings thereunder, the District shall not, at any time prior to the earlier of the Stated Maturity or final payment of the Bonds, enter into any transaction that reduces the amount required to be paid to the United States pursuant to Subsection (h) of this Section because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction had been at arm's length and had the Yield of the Bonds not been relevant to either party. U) Elections. The District hereby directs and authorizes the President of the Board of Directors, General Manager and Finance Manager, individually or jointly, to make elections permitted or required pursuant to the provisions of the Code or the Regulations, as they deem necessary or appropriate in connection with the Bonds, in the Certificate as to Tax Exemption or similar or other appropriate certificate, form or document. (k) Qualified Tax Exempt Obligations. In accordance with the provisions of paragraph (3) of subsection (b) of Section 265 of the Code, the District hereby designates the Notes to be "qualified tax exempt obligations" in that the Bonds are not "private activity bonds" as defined in the Code and represents the amount of "tax exempt obligations" (exclusive of "private activity bonds") to be issued by the District (including all subordinate entities of the District) for the calendar year in which the Bonds are issued will not exceed $10,000,000. SECTION 17: Sale of the Bonds. The Bonds are hereby sold, pursuant to the taking of public bids therefor, on this date, and shall be delivered to [ 1 (the "Purchaser") at a price of par plus a $[ 1 cash premium plus accrued interest. The Board hereby finds and determines that the net effective interest rate on the Bonds, as calculated pursuant to Texas Government Code, Chapter 1204, as amended is [ ]%. It is hereby officially found, determined and declared that the terms of this sale are the most advantageous reasonably obtainable and the Purchaser's sealed bid produced the lowest net effective interest rate to the District as required by Section 49.183, Texas Water Code. The Initial Bond(s) shall be registered in the name of the Purchaser. SECTION 18: Official Statement. The use of the Preliminary Official Statement by the Purchaser in connection with the public offering and sale of the Bonds is hereby ratified, confirmed and approved in all respects. The final Official Statement, being a modification and amendment of the Preliminary Official Statement to reflect the terms of sale (together with such changes approved by the President and Secretary of the Board of Directors, the General Manager and the Finance Manager, any one or more of said officials), shall be and is hereby in all respects approved and the Purchaser is hereby authorized to use and distribute said final Official Statement, dated November 25, 2014, in the reoffering, sale and delivery of the Bonds to the public. The President and Secretary of the Board of Directors are further authorized and directed to deliver for and on behalf of the District copies of said Preliminary Official Statement and Official Statement in final form as may be required by the Purchaser, and such final Official Statement in the form and content approved by the President or Secretary of the Board, General Manager or Finance Manager (one or more of said officials) shall be deemed to be approved by the Board of Directors and constitute the Official Statement authorized for distribution and use by the Purchaser. SECTION 19: Control and Custody of Bonds. The President of the Board of Directors of the District shall be and is hereby authorized to take and have charge of all necessary orders and records pending investigation by the Attorney General of the State of Texas, including the printing and supply of definitive Bonds, and shall take and have charge and control of the Initial 40660928.3111404702 24 Trophy Club Municipal Utility District No. 1 26 of 69 December 4, 2014 - Special Meeting Bond(s) pending the approval thereof by the Attorney General, the registration thereof by the Comptroller of Public Accounts and the delivery thereof to the Purchasers. Furthermore, the President and Secretary of the Board of Directors, the General Manager and Finance Manager of the District, any one or more of said officials, are hereby authorized and directed to furnish and execute such documents and certifications relating to the District and the issuance of the Bonds, including certifications as to facts, estimates, circumstances and reasonable expectations pertaining to the use, expenditure and investment of the proceeds of the Bonds, as may be necessary for the approval of the Attorney General, the registration by the Comptroller of Public Accounts and the delivery of the Bonds to the Purchasers and, together with the District's financial advisor, bond counsel and the Paying Agent/Registrar, make the necessary arrangements for the delivery of the Initial Bond(s) to the Purchasers and the initial exchange thereof for definitive Bonds. SECTION 20: Proceeds of Sale. The proceeds of sale of the Bonds, less amounts to pay costs of issuance and premium in the amount of $ , shall be deposited to the credit of a construction account maintained on the books and records of the District and, if not immediately invested, in a fund kept at a depository bank of the District. Pending expenditure for the Project, such proceeds of sale may be invested in Authorized Investments, including guaranteed investment contracts permitted in Texas Section 2256.015, et seq, and any investment earnings realized may be expended for the Project or deposited in the Interest and Sinking Fund as shall be determined by the Board of Directors. Accrued interest and premium in the above amount received from the sale of the Bonds and any excess bond proceeds, including investment earnings, remaining after completion of all authorized projects or purposes shall be deposited to the credit of the Interest and Sinking Fund. Pursuant to the Commission Order, the District will not expend $4,936,795.46 ($4,292,865.70 for construction plus $643,929.76 in contingencies) for the Project until receipt by the Board of plans and specifications approved by all entities with jurisdiction and construction documents. SECTION 21: Notices to Holders -Waiver. Wherever this Order provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and sent by United States Mail, first class postage prepaid, to the address of each Holder appearing in the Security Register at the close of business on the business day next preceding the mailing of such notice. In any case where notice to Holders is given by mail, neither the failure to mail such notice to any particular Holders, nor any defect in any notice so mailed, shall affect the sufficiency of such notice with respect to all other Bonds. Where this Order provides for notice in any manner, such notice may be waived in writing by the Holder entitled to receive such notice, either before or after the event with respect to which such notice is given, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Paying Agent/Registrar, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. SECTION 22: Cancellation. All Bonds surrendered for payment, redemption, transfer, exchange, or replacement, if surrendered to the Paying Agent/Registrar, shall be promptly cancelled by it and, if surrendered to the District, shall be delivered to the Paying Agent/Registrar and, if not already cancelled, shall be promptly cancelled by the Paying Agent/Registrar. The District may at any time deliver to the Paying Agent/Registrar for 40660928.3111404702 25 Trophy Club Municipal Utility District No. 1 27 of 69 December 4, 2014 - Special Meeting cancellation any Bonds previously certified or registered and delivered which the District may have acquired in any manner whatsoever, and all Bonds so delivered shall be promptly cancelled by the Paying Agent/Registrar. All cancelled Bonds held by the Paying Agent/Registrar shall be returned to the District. SECTION 23: Legal Opinion. The obligation of the Purchasers to accept delivery of the Bonds is subject to being furnished a final opinion of Fulbright & Jaworski LLP, Attorneys, Dallas, Texas, approving such Bonds as to their validity, said opinion to be dated and delivered as of the date of delivery and payment for the Bonds. A true and correct reproduction of said opinion or an executed counterpart thereof is hereby authorized to be either printed on definitive printed obligations or deposited with DTC along with the global certificates for the implementation and use of the Book Entry Only System used in the settlement and transfer of the Bonds. SECTION 24: CUSIP Numbers. CUSIP numbers may be printed or typed on the definitive Bonds. It is expressly provided, however, that the presence or absence of CUSIP numbers on the definitive Bonds shall be of no significance or effect as regards the legality thereof and neither the District nor attorneys approving the Bonds as to legality are to be held responsible for CUSIP numbers incorrectly printed or typed on the definitive Bonds. SECTION 25: Benefits of Order. Nothing in this Order, expressed or implied, is intended or shall be construed to confer upon any person other than the District, the Paying Agent/Registrar and the Holders, any right, remedy, or claim, legal or equitable, under or by reason of this Order or any provision hereof, this Order and all its provisions being intended to be and being for the sole and exclusive benefit of the District, the Paying Agent/Registrar and the Holders. SECTION 26: Inconsistent Provisions. All orders or resolutions, or parts thereof, which are in conflict or inconsistent with any provision of this Order are hereby repealed to the extent of such conflict, and the provisions of this Order shall be and remain controlling as to the matters contained herein. SECTION 27: Governing Law. This Order shall be construed and enforced in accordance with the laws of the State of Texas and the United States of America. SECTION 28: Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction hereof. SECTION 29: Construction of Terms. If appropriate in the context of this Order, words of the singular number shall be considered to include the plural, words of the plural number shall be considered to include the singular, and words of the masculine, feminine or neuter gender shall be considered to include the other genders. SECTION 30: Severability. If any provision of this Order or the application thereof to any circumstance shall be held to be invalid, the remainder of this Order and the application thereof to other circumstances shall nevertheless be valid, and the Board of Directors hereby declares that this Order would have been enacted without such invalid provision. 40660928.3111404702 26 Trophy Club Municipal Utility District No. 1 28 of 69 December 4, 2014 - Special Meeting SECTION 31: Continuing Disclosure Undertaking. {a) Definitions. As used in this Section, the following terms have the meanings ascribed to such terms below: "MSRB" means the Municipal Securities Rulemaking Board. "Rule" means SEC Rule 15c2-12, as amended from time to time or officially interpreted by the SEC. "SEC" means the United States Securities and Exchange Commission. (b) Annual Reports. The District shall provide annually to the MSRB (1) within six months after the end of each fiscal year ending in or after 2014, financial information and operating data with respect to the District of the general type included in the final Official Statement authorized by Section 18 of this Order, being the information described in Exhibit 8 hereto, and (2) if not provided as part such financial information and operating data, audited financial statements of the District, when and if available. Any financial statements so to be provided shall be prepared in accordance with the accounting principles described in Exhibit 8 hereto, or such other accounting principles as the District may be required to employ from time to time pursuant to state law or regulation, and audited, if the District commissions an audit of such statements and the audit is completed within the period during which they must be provided. If audited financial statements are not available by the required time, the District will provide unaudited financial information and operating data of the general type included in the Official Statement as Appendix D by the required time and audited financial statements when and if such audited financial statements become available. If the District 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 District 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 document available to the public on the MSRB's Internet Web site or filed with the SEC. (c) Notice of Certain Events. The District shall provide notice of any of the following events with respect to the Bonds to the MSRB in a timely manner and not more than 1 0 business days after occurrence of the event: (i) Principal and interest payment delinquencies; (ii) Non-payment related defaults, if material; (iii) difficulties; (iv) difficulties; (v) Unscheduled draws on debt service reserves reflecting financial Unscheduled draws on credit enhancements reflecting financial Substitution of credit or liquidity providers, or their failure to perform; 40660928.3111404702 27 Trophy Club Municipal Utility District No. 1 29 of 69 December 4, 2014 - Special Meeting (vi) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB), or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds; (vii) Modifications to rights of holders of the Bonds, if material; (viii) Bond calls, if material, and tender offers; (ix) Defeasances; (x) Release, substitution, or sale of property securing repayment of the Bonds, if material; (xi) Rating changes; (xii) Bankruptcy, insolvency, receivership, or similar event of the District, which shall occur as described below; (xiii) The consummation of a merger, consolidation, or acquisition involving the District or the sale of all or substantially all of its assets, other than in the ordinary course of business, the entry into of a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and (xiv) Appointment of a successor or additional trustee or the change of name of a trustee, if material. For these purposes, any event described in the immediately preceding paragraph (12) is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the District 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 District, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the District. The District shall notify the MSRB, in a timely manner, of any failure by the District to provide financial information or operating data in accordance with this Section by the time required by this Section. (d) Filings with the MSRB. All financial information, operating data, financial statements, notices, and other documents provided to the MSRB in accordance with this Section shall be provided in an electronic format prescribed by the MSRB and shall be accompanied by identifying information as prescribed by the MSRB. (e) Limitations. Disclaimers and Amendments. The District shall be obligated to observe and perform the covenants specified in this Section with respect to the District and the Bonds while, but only while, the District remains an "obligated person" with respect to the Bonds 40660928.3111404702 28 Trophy Club Municipal Utility District No. 1 30 of 69 December 4, 2014 - Special Meeting within the meaning of the Rule, except that the District in any event will give the notice required by subsection (c) hereof of any Bond calls and/or defeasances that cause the District to no longer be such an "obligated person". The provisions of this Section are for the sole benefit of the Holders 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 District 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 financial results, condition, or prospects of the District or the State of Texas or hereby undertake to update any information provided in accordance with this Section or otherwise, except as expressly provided herein. The District 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. UNDER NO CIRCUMSTANCES SHALL THE DISTRICT BE LIABLE TO THE HOLDER 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 DISTRICT, 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. No default by the District in observing or performing its obligations under this Section shall constitute a breach of or default under this Order for purposes of any other provision of this Order. Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the duties of the District under federal and state securities laws. Notwithstanding anything herein to the contrary, the provisions of this Section may be amended by the District from time to time to adapt to changed circumstances resulting from a change in legal requirements, a change in law, or a change in the identity, nature, status, or type of operations of the District, 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 of the Bonds in compliance with the Rule, taking into account any amendments or interpretations of the Rule to the date of such amendment, as well as such changed circumstances, and (2) either (a) the Holders of a majority in aggregate principal amount (or any greater amount required by any other provision of this Order that authorizes such an amendment) of the Outstanding Bonds consent to such amendment or (b) a Person that is unaffiliated with the District (such as nationally recognized bond counsel) determines that such amendment will not materially impair the interests of the Holders and beneficial owners of the Bonds. The provisions of this Section may also be amended from time to time or repealed by the District if the SEC amends or repeals the applicable provisions of the Rule or a court of final jurisdiction determines that such provisions are invalid, but only if and to the extent that reservation of the District's right to do so would not prevent underwriters of the initial public offering of the Bonds from lawfully purchasing or selling Bonds in such offering. If the District 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) an explanation, in narrative form, of the reasons for the amendment and of the impact of any change in the type of financial information or operating data so provided. 40660928.3/11404 702 29 Trophy Club Municipal Utility District No. 1 31 of 69 December 4, 2014 - Special Meeting SECTION 32: Additional Bonds and Refunded Bonds. (a) The District expressly reserves the right to issue, in one or more installments, for the purpose of purchasing, constructing, acquiring, owning, operating, maintaining, repairing, improving, or extending the System, or for any other lawful purpose: (1) the unissued unlimited tax bonds which remain authorized but unissued; and (2) such other unlimited tax bonds as may hereafter be authorized at subsequent elections. (b) The District further reserves the right to issue combination unlimited tax and revenue bonds, if authorized by election, and such other bonds or other obligations as may be lawfully issued by the District including any obligations issued for special projects or defined areas. (c) The District further reserves the right to issue refunding bonds in any manner permitted by law to refund the Bonds, any Additional Bonds or any other bonds issued by the District, at or prior to their respective dates of maturity or redemption. SECTION 33: Further Procedures. Any one or more of the President, Vice President and Secretary of the Board of Directors, the General Manager and Finance Manager of the District 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 on behalf of the District all agreements, instruments, certificates or other documents, whether mentioned herein or not, as may be necessary or desirable in order to carry out the terms and provisions of this Order and the issuance of the Bonds. In addition, prior to the initial delivery of the Bonds, the President and Vice President of the Board of Directors, the General Manager, Finance Manager or Bond Counsel to the District are each hereby authorized and directed to approve any changes or corrections to this Order or to any of the documents authorized and approved by this Order: (i) in order to cure any ambiguity, formal defect, or omission in the Order or such other document; or (ii) as requested by the Attorney General of the State of Texas or his representative to obtain the approval of the Bonds by the Attorney General. In the event that any officer of the District whose signature shall appear on any document shall cease to be such officer before the delivery of such document, such signature nevertheless shall be valid and sufficient for all purposes the same as if such officer had remained in office until such delivery. SECTION 34: Incorporation of Findings and Determinations. The findings and determinations of the Board of Directors of the District contained in the preamble hereof are hereby incorporated by reference and made a part of this Order for all purposes as if the same were restated in full in this Section. SECTION 35: No Recourse Against District Officials. No recourse shall be had for the payment of principal of, premium, if any, or interest on any Bond or for any claim based thereon or on this Order against any official of the District or any person executing any Bond. SECTION.36: Authorization of Escrow Agreement; Payment of TCEQ Fee. The Board hereby finds and determines that it is in the best interest of the District to authorize the execution of an Escrow Agreement to comply with the TCEQ's rules and regulations and other 40660928.3111404702 30 Trophy Club Municipal Utility District No. 1 32 of 69 December 4, 2014 - Special Meeting applicable law. A copy of the Escrow Agreement is attached hereto, in substantially final form, as Exhibit C and is incorporated by reference to the provisions of this Order. The President, Vice President and Secretary of the Board, General Manager or Finance Manager (one or more of said officials), or the designee thereof, are authorized to execute the Escrow Agreement as the act and deed of the District. SECTION 37: Public Meeting. It is officially found, determined, and declared that the meeting at which this Order is adopted was open to the public and public notice of the time, place, and subject matter of the public business to be considered at such meeting, including this Order, was given, all as required by Texas Government Code, Chapter 551, as amended, and Texas Water Code, Sections 49.063 and 49.064, as amended. SECTION 38: Effective Date. This Order shall be in force and effect from and after its passage on the date shown below. [Remainder of page left blank intentionally] 40660928.3111404702 31 Trophy Club Municipal Utility District No. 1 33 of 69 December 4, 2014 - Special Meeting PASSED AND ADOPTED, this December 4, 2014. ATTEST: Kevin R. Carr Secretary, Board of Directors (District Seal 40660928.3111404 702 S-1 TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 Jim Moss President, Board of Directors Trophy Club Municipal Utility District No. 1 34 of 69 December 4, 2014 - Special Meeting EXHIBIT A PAYING AGENT/REGISTRAR AGREEMENT 40660928.3/11404 702 A-1 Trophy Club Municipal Utility District No. 1 35 of 69 December 4, 2014 - Special Meeting PAYING AGENT/REGISTRAR AGREEMENT THIS AGREEMENT is entered into as of December 4, 2014 (this "Agreement"), by and between BOKF, NA, dba Bank of Texas, a banking association duly organized and existing under the laws of the United States of America, or its successors (the "Bank") and the Trophy Club Municipal Utility District No. 1 (the "Issuer"), RECITALS WHEREAS, the Issuer has duly authorized and provided for the issuance of its "Trophy Club Municipal Utility District No. 1 Unlimited Tax Bonds, Series 2014" (the "Securities"), dated December 15, 2014, which Securities scheduled to be delivered to the initial purchasers on or about December 23, 2014; and WHEREAS, the Issuer has selected the Bank to serve as Paying Agent/Registrar in connection with the payment of the principal of, premium, if any, and interest on said Securities and with respect to the registration, transfer and exchange thereof by the registered owners thereof; and WHEREAS, the Bank has agreed to serve in such capacities for and on behalf of the Issuer and has full power and authority to perform and serve as Paying Agent/Registrar for the Securities; NOW, THEREFORE, it is mutually agreed as follows: ARTICLE ONE APPOINTMENT OF BANK AS PAYING AGENT AND REGISTRAR Section 1.01: Appointment. The Issuer hereby appoints the Bank to serve as Paying Agent with respect to the Securities, and, as Paying Agent for the Securities, the Bank shall be responsible for paying on behalf of the Issuer the principal, premium (if any), and interest on the Securities as the same become due and payable to the registered owners thereof; all in accordance with this Agreement and the "Bond Resolution" (hereinafter defined). The Issuer hereby appoints the Bank as Registrar with respect to the Securities and, as Registrar for the Securities, the Bank shall keep and maintain for and on behalf of the Issuer books and records as to the ownership of said Securities and with respect to the transfer and exchange thereof as provided herein and in the Bond Resolution. The Bank hereby accepts its appointment, and agrees to serve as the Paying Agent and Registrar for the Securities. Section 1.02: Compensation. As compensation for the Bank's services as Paying Agent/Registrar, the Issuer hereby agrees to pay the Bank the fees and amounts set forth in Annex A attached. In addition, the Issuer agrees to reimburse the Bank upon its request for all reasonable expenses, disbursements and advances incurred or made by the Bank in accordance with any of the provisions hereof (including the reasonable compensation and the expenses and disbursements of its agents and counsel). 41209488.1/11411679 Trophy Club Municipal Utility District No. 1 36 of 69 December 4, 2014 - Special Meeting ARTICLE TWO DEFINITIONS Section 2.01: Definitions. For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires: "Acceleration Date" on any Security means the date on and after which the principal or any or all installments of interest, or both, are due and payable on any Security which has become accelerated pursuant to the terms of the Security. "Bank Office" means the designated office of the Bank at the address shown in Section 3.01. "Bond Resolution" means the resolution, order, or ordinance of the governing body of the Issuer pursuant to which the Securities are issued, as the same may be amended or modified, including any pricing certificate related thereto, certified by the secretary or any other officer of the Issuer and delivered to the Bank. "Holder" and "Security Holder" each means the Person in whose name a Security is registered in the Security Register. "Person" means any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision of a government. "Predecessor Securities" of any particular Security means every previous Security evidencing all or a portion of the same obligation as that evidenced by such particular Security (and, for the purposes of this definition, any mutilated, lost, destroyed, or stolen Security for which a replacement Security has been registered and delivered in lieu thereof pursuant to Section 4.06 hereof and the Bond Resolution). "Redemption Date", when used with respect to any Security to be redeemed, means the date fixed for such redemption pursuant to the terms of the Bond Resolution. "Responsible Officer", when used with respect to the Bank, means the Chairman or Vice-Chairman of the Board of Directors, the Chairman or Vice-Chairman of the Executive Committee of the Board of Directors, the President, any Vice President, the Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any Assistant Cashier, any Trust Officer or Assistant Trust Officer, or any other officer of the Bank customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject. "Security Register" means a register maintained by the Bank on behalf of the Issuer providing for the registration and transfers of Securities. 41209488.1/11411679 2 Trophy Club Municipal Utility District No. 1 37 of 69 December 4, 2014 - Special Meeting "Stated Maturity" means the date specified in the Bond Resolution the principal of a Security is scheduled to be due and payable. Section 2.02: Other Definitions. The terms "Bank," "Issuer," and "Securities (Security)" have the meanings assigned to them in the recital paragraphs of this Agreement. The term "Paying Agent/Registrar" refers to the Bank in the performance of the duties and functions of this Agreement. ARTICLE THREE PAYING AGENT Section 3.01: Duties of Paying Agent. As Paying Agent, the Bank shall pay, provided adequate collected funds have been provided to it for such purpose by or on behalf of the Issuer, on behalf of the Issuer the principal of each Security at its Stated Maturity, Redemption Date or Acceleration Date, to the Holder upon surrender of the Security to the Bank at the following address: Bank of Texas Corporate Trust Services 111 Fillmore Avenue East St. Paul, MN 55107-1402 As Paying Agent, the Bank shall, provided adequate collected funds have been provided to it for such purpose by or on behalf of the Issuer, pay on behalf of the Issuer the interest on each Security when due, by computing the amount of interest to be paid each Holder and making payment thereof to the Holders of the Securities (or their Predecessor Securities) on the Record Date (as defined in the Bond Resolution). All payments of principal and/or interest on the Securities to the registered owners shall be accomplished (1) by the issuance of checks, payable to the registered owners, drawn on the fiduciary account provided in Section 5.05 hereof, sent by United States mail, first class postage prepaid, to the address appearing on the Security Register or (2) by such other method, acceptable to the Bank, requested in writing by the Holder at the Holder's risk and expense. Section 3.02: Payment Dates. The Issuer hereby instructs the Bank to pay the principal of and interest on the Securities on the dates specified in the Bond Resolution. ARTICLE FOUR REGISTRAR Section 4.01: Security Register-Transfers and Exchanges. The Bank agrees to keep and maintain for and on behalf of the Issuer at the Bank Office books and records (herein sometimes referred to as the "Security Register") for recording the names and addresses of the Holders of the Securities, the transfer, exchange and replacement of the Securities and the payment of the principal of and interest on the Securities to the Holders and containing such other information as may be reasonably required by the Issuer and subject to such reasonable regulations as the Issuer and Bank may prescribe. All transfers, exchanges and replacement of Securities shall be noted in the Security Register. Every Security surrendered for transfer or exchange shall be duly endorsed or be accompanied by a written instrument of transfer, the signature on which has been guaranteed by an officer of a federal or state bank or a member of the National Association of Securities 41209488.1/11411679 3 Trophy Club Municipal Utility District No. 1 38 of 69 December 4, 2014 - Special Meeting Dealers, in a form satisfactory to the Bank and duly executed by the Holder thereof or his agent duly authorized in writing. The Bank may request any supporting documentation it feels necessary to effect a re-registration, transfer or exchange of the Securities. To the extent possible and under reasonable circumstances, the Bank agrees that, in relation to an exchange or transfer of Securities, the exchange or transfer by the Holders thereof will be completed and new Securities delivered to the Holder or the assignee of the Holder in not more than three (3) business days after the receipt of the Securities to be cancelled in an exchange or transfer and the written instrument of transfer or request for exchange duly executed by the Holder, or his duly authorized agent, in form and manner satisfactory to the Paying AgenURegistrar. Section 4.02: Securities. The Issuer shall provide an adequate inventory of printed Securities when needed to facilitate transfers or exchanges thereof. The Bank covenants that the inventory of printed Securities will be kept in safekeeping pending their use and reasonable care will be exercised by the Bank in maintaining such Securities in safekeeping, which shall be not less than the care maintained by the Bank for debt securities of other governments or corporations for which it serves as registrar, or that is maintained for its own securities. Section 4.03: Form of Security Register. The Bank, as Registrar, will maintain the Security Register relating to the registration, payment, transfer and exchange of the Securities in accordance with the Bank's general practices and procedures in effect from time to time. The Bank shall not be obligated to maintain such Security Register in any form other than those which the Bank has currently available and currently utilizes at the time. The Security Register may be maintained in written form or in any other form capable of being converted into written form within a reasonable time. Section 4.04: List of Security Holders. The Bank will provide the Issuer at any time requested by the Issuer, upon payment of the required fee, a copy of the information contained in the Security Register. The Issuer may also inspect the information contained in the Security Register at any time the Bank is customarily open for business, provided that reasonable time is allowed the Bank to provide an up-to-date listing or to convert the information into written form. The Bank will not release or disclose the contents of the Security Register to any person other than to, or at the written request of, an authorized officer or employee of the Issuer, except upon receipt of a court order or as otherwise required by law. Upon receipt of a court order and prior to the release or disclosure of the contents of the Security Register, the Bank will notify the Issuer so that the Issuer may contest the court order or such release or disclosure of the contents of the Security Register. Section 4.05: Return of Cancelled Securities. The Bank will, at such reasonable intervals as it determines, surrender to the Issuer, all Securities in lieu of which or in exchange for which other Securities have been issued, or which have been paid. Section 4.06: Mutilated, Destroyed, Lost or Stolen Securities. The Issuer hereby instructs the Bank, subject to the provisions of the Bond Resolution, to deliver and issue Securities in exchange for or in lieu of mutilated, destroyed, lost, or stolen Securities as long as the same does not result in an overissuance. 41209488.1/11411679 4 Trophy Club Municipal Utility District No. 1 39 of 69 December 4, 2014 - Special Meeting In case any Security shall be mutilated, destroyed, lost or stolen, the Bank may execute and deliver a replacement Security of like form and tenor, and in the same denomination and bearing a number not contemporaneously outstanding, in exchange and substitution for such mutilated Security, or in lieu of and in substitution for such mutilated, destroyed, lost or stolen Security, only upon the approval of the Issuer and after (i) the filing by the Holder thereof with the Bank of evidence satisfactory to the Bank of the destruction, loss or theft of such Security, and of the authenticity of the ownership thereof and (ii) the furnishing to the Bank of indemnification in an amount satisfactory to hold the Issuer and the Bank harmless. All expenses and charges associated with such indemnity and with the preparation, execution and delivery of a replacement Security shall be borne by the Holder of the Security mutilated, destroyed, lost or stolen. Section 4.07: Transaction Information to Issuer. The Bank will, within a reasonable time after receipt of written request from the Issuer, furnish the Issuer information as to the Securities it has paid pursuant to Section 3.01, Securities it has delivered upon the transfer or exchange of any Securities pursuant to Section 4.01, and Securities it has delivered in exchange for or in lieu of mutilated, destroyed, lost, or stolen Securities pursuant to Section 4.06. ARTICLE FIVE THE BANK Section 5.01: Duties of Bank. The Bank undertakes to perform the duties set forth herein and agrees to use reasonable care in the performance thereof. Section 5.02: Reliance on Documents. Etc. (a) The Bank may conclusively rely, as to the truth of the statements and correctness of the opinions expressed therein, on certificates or opinions furnished to the Bank. (b) The Bank shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Bank was negligent in ascertaining the pertinent facts. (c) No provisions of this Agreement shall require the Bank to expend or risk its own funds or otherwise incur any financial liability for performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity satisfactory to it against such risks or liability is not assured to it. (d) The Bank may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note, security or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. Without limiting the generality of the foregoing statement, the Bank need not examine the ownership of any Securities, but is protected in acting upon receipt of Securities containing an endorsement or instruction of transfer or power of transfer which appears on its face to be signed by the Holder or an agent of the Holder. The Bank shall not be bound to make any investigation into the facts or matters stated in a resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note, security or other paper or document supplied by the Issuer. 41209488.1/11411679 5 Trophy Club Municipal Utility District No. 1 40 of 69 December 4, 2014 - Special Meeting (e) The Bank may consult with counsel, and the written advice of such counsel or any opinion of counsel shall be full and complete authorization and protection with respect to any action taken, suffered, or omitted by it hereunder in good faith and in reliance thereon. (f) The Bank may exercise any of the powers hereunder and perform any duties hereunder either directly or by or through agents or attorneys of the Bank. Section 5.03: Recitals of Issuer. The recitals contained herein with respect to the Issuer and in the Securities shall be taken as the statements of the Issuer, and the Bank assumes no responsibility for their correctness. The Bank shall in no event be liable to the Issuer, any Holder or Holders of any Security, or any other Person for any amount due on any Security from its own funds. Section 5.04: May Hold Securities. The Bank, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with the Issuer with the same rights it would have if it were not the Paying Agent/Registrar, or any other agent. Section 5.05: Moneys Held by Bank -Fiduciary account/Collateralization. A fiduciary account shall at all times be kept and maintained by the Bank for the receipt, safekeeping, and disbursement of moneys received from the Issuer hereunder for the payment of the Securities, and money deposited to the credit of such account until paid to the Holders of the Securities shall be continuously collateralized by securities or obligations which qualify and are eligible under both the laws of the State of Texas and the laws of the United States of America to secure and be pledged as collateral for fiduciary accounts to the extent such money is not insured by the Federal Deposit Insurance Corporation. Payments made from such fiduciary account shall be made by check drawn on such account unless the owner of the Securities shall, at its own expense and risk, request such other medium payment. The Bank is not obligated to pay interest on any money received by it under this Agreement. Subject to the applicable unclaimed property laws of the State of Texas, any money deposited with the Bank for the payment of the principal, premium (if any), or interest on any Security and remaining unclaimed for three years after final maturity of the Security has become due and payable will be paid by the Bank to the Issuer, and the Holder of such Security shall thereafter look only to the Issuer for payment thereof, and all liability of the Bank with respect to such moneys shall thereafter cease. Section 5.06: Indemnification. To the extent permitted by law, the Issuer agrees to indemnify the Bank, its directors, officers and employees, for, and hold it harmless against, any loss, liability, or expense incurred without negligence or bad faith on its part, arising out of or in connection with its acceptance or administration of its duties hereunder, including the cost and expense against any claim or liability in connection with the exercise or performance of any of its powers or duties under this Agreement. Section 5.07: Interpleader. The Issuer and the Bank agree that the Bank may seek adjudication of any adverse claim, demand, or controversy over its person as well as funds on deposit, in either a Federal or State District Court located in the State and County where the administrative offices of the Issuer is located, and agree that service of process by certified or registered mail, return receipt requested, to the address referred to in Section 6.03 of this 41209488.1/11411679 6 Trophy Club Municipal Utility District No. 1 41 of 69 December 4, 2014 - Special Meeting Agreement shall constitute adequate service. The Issuer and the Bank further agree that the Bank has the right to file a Bill of Interpleader in any court of competent jurisdiction in the State of Texas to determine the rights of any Person claiming any interest herein. Section 5.08: DTC Services. It is hereby represented and warranted that, in the event the Securities are otherwise qualified and accepted for "Depository Trust Company" services or equivalent depository trust services by other organizations, the Bank has the capability and, to the extent within its control, will comply with the "Operational Arrangements", which establishes requirements for securities to be eligible for such type depository trust services, including, but not limited to, requirements for the timeliness of payments and funds availability, transfer turnaround time, and notification of redemptions and calls. ARTICLE SIX MISCELLANEOUS PROVISIONS Section 6.01: Amendment. This Agreement may be amended only by an agreement in writing signed by both of the parties hereto. Section 6.02: Assignment. This Agreement may not be assigned by either party without the prior written consent of the other. Section 6.03: Notices. Any request, demand, authorization, direction, notice, consent, waiver, or other document provided or permitted hereby to be given or furnished to the Issuer or the Bank shall be mailed or delivered to the Issuer or the Bank, respectively, at the addresses shown on the signature page hereof. Section 6.04: Effect of Headings. The Article and Section headings herein are for convenience of reference only and shall not affect the construction hereof. Section 6.05: Successors and Assigns. All covenants and agreements herein by the Issuer shall bind its successors and assigns, whether so expressed or not. Section 6.06: Severability. In case any provision herein shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. Section 6.07: Benefits of Agreement. Nothing herein, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, any benefit or any legal or equitable right, remedy, or claim hereunder. Section 6.08: Entire Agreement. This Agreement and the Bond Resolution constitute the entire agreement between the parties hereto relative to the Bank acting as Paying Agent/Registrar and if any conflict exists between this Agreement and the Bond Resolution, the Bond Resolution shall govern. Section 6.09: Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which shall constitute one and the same Agreement. Section 6.10: Termination. This Agreement will terminate (i) on the date of final payment of the principal of and interest on the Securities to the Holders thereof or (ii) may be 41209488.1/11411679 7 Trophy Club Municipal Utility District No. 1 42 of 69 December 4, 2014 - Special Meeting earlier terminated by either party upon sixty (60) days written notice; provided, however, an early termination of this Agreement by either party shall not be effective until (a) a successor Paying Agent/Registrar has been appointed by the Issuer and such appointment accepted and (b) notice given to the Holders of the Securities of the appointment of a successor Paying Agent/Registrar. Furthermore, the Bank and Issuer mutually agree that the effective date of an early termination of this Agreement shall not occur at any time which would disrupt, delay or otherwise adversely affect the payment of the Securities. The resigning Paying Agent/Registrar may petition any court of competent jurisdiction for the appointment of a successor Paying Agent/Registrar if an instrument of acceptance by a successor Paying Agent/Registrar has not been delivered to the resigning Paying Agent/Registrar within sixty (60) days after the giving of such notice of resignation. Upon an early termination of this Agreement, the Bank agrees to promptly transfer and deliver the Security Register (or a copy thereof), together with other pertinent books and records relating to the Securities, to the successor Paying Agent/Registrar designated and appointed by the Issuer. Section 6.11: Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of Texas. [remainder of page left blank intentionally] 41209488.1/11411679 8 Trophy Club Municipal Utility District No. 1 43 of 69 December 4, 2014 - Special Meeting IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. Attest: Title: ____________ _ Attest: Secretary, Board of Directors BOKF, NA, dba Bank of Texas By: ______________ _ Title: ______________ _ Address: 100 Congress Avenue, Suite 250 Austin, Texas 78701 TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 By: ______________ ___ President, Board of Directors Address: 100 Municipal Drive Trophy Club, Texas 76262 41209488.1/11411679 Signature page to Paying Agent/Registrar Agreement Trophy Club Municipal Utility District No. 1 44 of 69 December 4, 2014 - Special Meeting EXHIBIT B DESCRIPTION OF ANNUAL FINANCIAL INFORMATION AND OPERATING DATA Information and Data The following information and data with respect to the District referred to in Section 31 of this Order are the quantitative financial information and operating data specified and included in the Appendix or under the headings of the Official Statement referred to below: 1. The financial statements of the District appended to the Official Statement as Appendix D for the most recently concluded fiscal year. 2. The information in Tables 1, 12 and 13 of Appendix A to the Official Statement. Accounting Principles The accounting principles referred to in such Section with respect to the District are the accounting principles described in the notes to the financial statements referred to in paragraph 1 above. 40660928.3111404702 B-1 Trophy Club Municipal Utility District No. 1 45 of 69 December 4, 2014 - Special Meeting 40660928.3111404702 EXHIBIT C ESCROW AGREEMENT C-1 Trophy Club Municipal Utility District No. 1 46 of 69 December 4, 2014 - Special Meeting ESCROW AGREEMENT This Escrow Agreement (the "Agreement") is entered into as of December 4, 2014 by and between Trophy Club Municipal Utility District No. 1 (the "Issuer"), a political subdivision of the State of Texas, and , a bank organized and existing under the laws of the ----------(the "Escrow Agenf'). WITNESSETH: WHEREAS, the Issuer has authorized and sold its Trophy Club Municipal Utility District Unlimited Tax Bonds, Series 2014, dated December 15, 2014, in the aggregate principal amount of $5,765,000 (the "Bonds"); and WHEREAS, the Texas Commission on Environmental Quality (the "Commission") by Order dated February 5, 2014, required a total of $4,936,795.46 ($4,292,865.70 for construction plus $643,929.76 for contingencies) of the Bond proceeds (the "Funds") for the Issuer's construction of a wastewater treatment facilities to be deposited in an escrow account to be held in escrow until the Commission staff provides written authorization for releasing the Funds from escrow. NOW, THEREFORE, in consideration of the premises and the covenants herein contained, the Issuer and the Escrow Agent agree as follows: Section 1: The Funds shall be deposited with and held in escrow in an interest earning account (certificate of deposit or demand deposit) to the credit of an account entitled "Trophy Club Municipal Utility District No. 1 Escrow Account" (the "Escrow Account") until released or transferred as provided in this Agreement. The escrow period shall begin on the date money is first deposited to the credit of the Escrow Account and shall terminate when all money so deposited has been released or transferred in accordance with this Agreement. Section 2: The Issuer reserves the right to secure release from the Escrow Agent of all or a portion of the Funds upon presentation to the Escrow Agent of an executed escrow agreement with another financial institution. Upon receipt of such an agreement the Escrow Agent shall transfer the released Funds held in the Escrow Account to such new escrow agent. Section 3: Upon written authorization from the Commission staff authorizing release of all or a portion of the Funds in the Escrow Account, the Escrow Agent will release the Funds as directed by the Issuer. Interest earned on the Funds is not subject to the terms of this Agreement and will be released as directed by the Issuer, without any requirement of Commission authorization. Section 4: If only a portion of the Funds in the Escrow Account are released pursuant to Section 3, or transferred pursuant to Section 2, the Escrow Agent shall continue to maintain the Escrow Account in accordance with the terms hereof until all Funds in the Escrow Account have been released or transferred, after which the Escrow Agent shall have no further duties pursuant to this Agreement. Section 5: The Escrow Agent may rely on, and shall not be liable for acting or refraining from acting in accordance with any written notice, instruction, request or other document furnished to it and believe by it to have been signed or presented by the proper party or parties. The Escrow Agent may consult with counsel regarding its duties or responsibilities under this Agreement and shall not be liable for action taken or not taken in good faith in reliance upon such counsel. The Escrow Agent shall not be liable for any exemplary, consequential, or incidental damages by reason 41212428.1 1 Trophy Club Municipal Utility District No. 1 47 of 69 December 4, 2014 - Special Meeting of performance of its duties under this Agreement, except for negligence or bad faith on the part of the Escrow Agent. This Agreement shall be governed by the laws of the State of Texas. Section 6: To the extent permitted by law, the Issuer will indemnify and defend the Escrow Agent from, and will hold it harmless from, any and all losses, costs, damages, claims and expenses, including attorney's fees, incurred or suffered by the Escrow Agent in connection with, or arising out of, this Escrow Agreement except for a such acts or omissions resulting from the negligence or willful misconduct of the Escrow Agent. Section 7: The Issuer hereby agrees to pay Escrow Agent for its services hereunder in accordance with Escrow Agent's fee schedule, a copy of which is attached hereto as Exhibit A. [remainder of page left blank intentionally] 41212428.1 2 Trophy Club Municipal Utility District No. 1 48 of 69 December 4, 2014 - Special Meeting IN WITNESS WHEREOF, the parties have executed this Escrow Agreement in multiple originals, each of which shall be deemed to be an original, as of the date and year first written above. Notice Address: 100 Municipal Drive Trophy Club, Texas 76262 Notice Address: 41212428.1 Title: S-1 Trophy Club Municipal Utility District No. 1 By: ________________________ ___ Title:-------------- ----------' as Escrow Agent By:--------------Name: _____________ __ Trophy Club Municipal Utility District No. 1 49 of 69 December 4, 2014 - Special Meeting EXHIBIT A The fees for escrow accounts are as follows: 41212428.1 A-1 Trophy Club Municipal Utility District No. 1 50 of 69 December 4, 2014 - Special Meeting 41210574.1/11411680 RESOLUTION NO. 2014-1204A A RESOLUTION authorizing appropriate personnel and consultants to proceed with arrangements and the preparation of documents for the issuance and sale of revenue bonds; approving and authorizing publication of a notice of sale with respect to issuance and sale of such bonds; and resolving other matters incident and related thereto WHEREAS, the Board of Directors (the "Board") of the Trophy Club Municipal Utility District No. 1 (the "District") has determined that revenue bonds should be issued and sold in a principal amount not to exceed $9,230,000; and WHEREAS, the Board hereby finds and determines that it is now proper to (1) authorize appropriate personnel and consultants to proceed with arrangements and the preparation of documents for the issuance and sale of revenue bonds and (2) authorize the publication of a notice of sale with respect to such bonds with a tentative sale date of January , 2015, pursuant to the provisions of Texas Water Code, Section 49.183; NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1: SECTION 1: The General Manager for the District, together with the District’s financial advisor, Southwest Securities, Inc. and bond counsel, Fulbright & Jaworski LLP, a member of Norton Rose Fulbright, are hereby authorized and directed to proceed on behalf of the District with the preparation of the documents and to make the appropriate arrangements for the offering and sale of revenue bonds in a principal amount not to exceed $9,230,000. The General Manager and other appropriate officials of the District are hereby authorized and directed to assist and furnish said consultants with information and data necessary for the preparation of an official statement and other documents for a sale of such bonds to occur and be approved by the Board of Directors at a meeting to be held on or about January , 2015. SECTION 2: The Secretary of the Board of Directors is hereby authorized and directed to cause a notice of sale relating to the sale of revenue bonds to be published (1) at least one time not less than 10 days before the date of sale in a newspaper of general circulation in the county or counties in which the District is located and (2) at least one time in one or more recognized financial publications of general circulation in the State of Texas as approved by the State Attorney General; such notice of sale to read substantially in the form and content of Exhibit A hereto attached and incorporated herein by reference as a part of this Resolution for all purposes. SECTION 3: It is officially found, determined and declared that the meeting at which this Resolution is adopted was open to the public and public notice of the time, place and subject matter of the public business to be considered at such meeting, including this Resolution, was given, all as required by all as required by Texas Government Code, Chapter 551, as amended. SECTION 4: This Resolution shall be in force and effect from and after its passage on the date shown below. Trophy Club Municipal Utility District No. 1 51 of 69 December 4, 2014 - Special Meeting [signature page of Resolution] 41210574.1/11411680 PASSED AND ADOPTED, this December 4, 2014. TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 Jim Moss, President Board of Directors ATTEST: Kevin R. Carr, Secretary/Treasurer Board of Directors (District Seal) Trophy Club Municipal Utility District No. 1 52 of 69 December 4, 2014 - Special Meeting 41210574.1/11411680 Exhibit A $9,230,000 TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 (A political subdivision of the State of Texas located in Denton and Tarrant Counties, Texas) REVENUE BONDS, SERIES 2015 Selling: January ____, 2015 Bids due ____:00 a.m. Central Standard Time ("CST") Place and Time of Award: The District will consider the award of the sale of the Bonds on January ___, 2015 at ____ P.M., C.S.T., at the District’s Office, 100 Municipal Drive, Trophy Club, Texas 76262. Action will be taken immediately by the Board of Directors of the District to accept or reject the best bid. Each bidder must deliver a bank Cashier’s Check in the amount of $________, payable to the order of Trophy Club Municipal Utility District No. 1, as a good faith deposit to the District's Financial Advisor, Dan Almon, Southwest Securities, 1201 Elm St., Suite 3500, Dallas, Texas 75270, by ___:00 A.M., C.S.T. on the date of the sale. Address of the Bids Delivered in Person: Sealed written bids, plainly marked "Bid for Bonds" should be addressed to the Board of Directors of Trophy Club Municipal Utility District No. 1, and delivered to Dan Almon, Southwest Securities, 1201 Elm St., Suite 3500, Dallas, Texas 75270, by ___:00 A.M., C.S.T. on January ___, 2015. All bids must be signed and submitted on the "Official Bid Form". Electronic Bidding Procedures: Any prospective bidder that intends to submit an electronic bid must submit its electronic bid through the facilities of the Ipreo Holdings LLC, PARITY System by ___:00 A.M., C.S.T., on January ___, 2015 as described in the "Official Notice of Sale" described below. Information: The Bonds are more completely described in the "Official Notice of Sale", "Official Bid Form" and the "Preliminary Official Statement" for the Bonds which may be obtained from Dan Almon, Southwest Securities, 1201 Elm St., Suite 3500, Dallas, Texas 75270, Financial Advisor to the District. All bidders must submit a SIGNED OFFICIAL BID FORM prior to the time of sale, which is ___:00 A.M., C.S.T. on January ___, 2015, to Dan Almon, Southwest Securities, 1201 Elm St., Suite 3500, Dallas, Texas 75270 in accordance with the Official Notice of Sale. The bidder whose bid is the winning bid in accordance with the Official Notice of Sale will be notified immediately. The District reserves the right to reject any or all bids for the Bonds and to waive any and all irregularities except time of filing. This notice does not constitute an offer to sell the Bonds but is merely notice of sale of the Bonds as required by law. The offer to sell the Bonds will be made only by means of the "Official Notice of Sale", the "Preliminary Official Statement" and the "Official Bid Form" for the Bonds. This Notice of Sale supersedes and replaces any previously published Notice of Sale for the Bonds. Board of Directors Trophy Club Municipal Utility District No. 1 Trophy Club Municipal Utility District No. 1 53 of 69 December 4, 2014 - Special Meeting CERTIFICATE FOR RESOLUTION STATE OF TEXAS § COUNTIES OF TARRANT AND DENTON § We, the undersigned officers of the Board of Directors of Trophy Club Municipal Utility District No. 1 (the “District”) hereby certify as follows: 1. The Board of Directors of the District convened in a special meeting on the 4th day of December, 2014 at the designated meeting place within the boundaries of the District, and the roll was called of the duly constituted officers and members of the Board, to-wit: Jim Moss President Jim Hase Vice President Kevin R. Carr Secretary/Treasurer Jim Thomas Director Neil Twomey Director and all of said persons were present, thus constituting a quorum. Whereupon, among other business, the following was transacted at the meeting: a written RESOLUTION 2014-1204B APPROVING APPLICATION TO TEXAS COMMISSION ON ENVIRONMENTAL QUALITY FOR EXTENSION OF TIME TO SELL BONDS was introduced for the consideration of the Board. It was then duly moved and seconded that the Resolution be adopted; and, after due discussion, the motion, carrying with it the adoption of the Resolution, prevailed and carried by the following vote: Ayes: ___ Nays: ____ 2. That a true, full and correct copy of the aforesaid Resolution adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been duly recorded in the Board's minutes of the meeting; that the persons named in the above and foregoing paragraph are the duly chosen, qualified and acting officers and members of the Board as indicated therein; that each of the officers and members of the Board was duly and sufficiently notified officially and personally, in advance, of the time, place and purpose of the aforesaid meeting, that the Resolution would be introduced and considered for adoption at the meeting, and each of the officers and members consented, in advance, to the holding of the meeting for such purpose; that the meeting was open to the public as required by law; and that public notice of the time, place and subject of the meeting was given as required by Chapter 551, Texas Government Code, and Section 49.063, Texas Water Code. Trophy Club Municipal Utility District No. 1 54 of 69 December 4, 2014 - Special Meeting SIGNED AND SEALED on this 4th day of December, 2014. Jim Moss, President Board of Directors ATTEST: Kevin R. Carr, Secretary Board of Directors (SEAL) Laurie Slaght, District Secretary Trophy Club Municipal Utility District No. 1 Trophy Club Municipal Utility District No. 1 55 of 69 December 4, 2014 - Special Meeting TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 RESOLUTION NO. 2014-1204B RESOLUTION APPROVING APPLICATION TO TEXAS COMMISSION ON ENVIRONMENTAL QUALITY FOR EXTENSION OF TIME TO SELL BONDS STATE OF TEXAS § COUNTY OF TARRANT AND DENTON § WHEREAS, Trophy Club Municipal Utility District No. 1 (the "District") is a water conservation and reclamation district created and operating in accordance with Chapters 49 and 54 of the Texas Water Code; and WHEREAS, by order dated February 6, 2013 (the “Order”), the Texas Commission on Environmental Quality (“TCEQ”) authorized the issuance of revenue bonds (the “Bonds”) by the District in an amount equal to $14,995,000 (consisting of $5,765,000 in unlimited tax bonds and $9,230,000 in revenue bonds) for purposes of funding certain improvements to the District’s wastewater treatment plant and related appurtenances, as more particularly described in the Order (collectively, the “Project”); WHEREAS, a property owner within the District appealed the issuance of the Order by TCEQ by litigation filed in Travis County District Court. By Final Judgment dated October 30, 2014, the Court upheld the issuance of the Order by TCEQ; WHEREAS, 30 TAC § 293.45(a) provides that unless bids are received and accepted for sale of bonds within one year of the effective date of TCEQ’s order approving bonds, a district may not proceed with the sale of the bonds without executive director approval of an application for an extension of time meeting the requirements of 30 TAC § 293.87; WHEREAS, as a result of the above-referenced litigation against TCEQ, the District has not yet received bids for the sale of the Bonds. As a result, the Board of Directors of the District desires to make application to the executive director for approval of an application for an extension of time meeting the requirements of 30 TAC §293.87. Now, Therefore, NOW, THEREFORE, BE IT RESOLVED BY TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1, BOARD OF THE DIRECTORS THAT: Section 1. The facts and recitations found in the preamble of this Resolution are hereby found and declared to be true and correct, and are incorporated by reference herein and expressly made a part hereof, as if copied verbatim. Section 2: The Board of Directors of the District requests that the Executive Director of TCEQ hereby extend the approval for issuance of the Bonds. Section 3. The Board of Directors hereby directs that any applicable information required by TCEQ Rule 30 TAC §293.45 be furnished to TCEQ in connection with this application: Trophy Club Municipal Utility District No. 1 56 of 69 December 4, 2014 - Special Meeting Section 4. The President and the Secretary of the Board of Directors of the District, and the District’s General Manager and consultants, are hereby authorized and directed to do any and all things necessary and proper in connection with this application to the Commission, including payment of all application and filing fees associated therewith. Section 5. A certified copy of this Resolution shall constitute an application on behalf of the District for the approvals set forth above. PASSED AND APPROVED on this 4th day of December, 2014. Jim Moss, President Board of Directors ATTEST: Kevin R. Carr, Secretary Board of Directors (SEAL) Laurie Slaght, District Secretary Trophy Club Municipal Utility District No. 1 Trophy Club Municipal Utility District No. 1 57 of 69 December 4, 2014 - Special Meeting THE STATE OF TEXAS KNOW ALL BY THESE PRESENTS COUNTY OF TARRANT AMENDMENT TO THE AGREEMENT FOR WATER SERVICE BETWEEN THE CITY OF FORT WORTH AND TROPHY CLUB MUNICIPAL DISTRICT NO. 1 FOR THE CONSTRUCTION OF A NORTHSIDE II 48-INCH WATER MAIN AND ALLOCATED CAPACITY This Amendment is made and entered into by and between Trophy Club Municipal District No. 1, acting herein by and through its General Manager, Jennifer McKnight, hereinafter referred to as CUSTOMER and the City of Fort Worth, acting herein by and through its Assistant City Manager, Fernando Costa, hereinafter referred to as FORT WORTH, all of Tarrant County, State of Texas, (collectively the “PARTIES”) witnesseth: WHEREAS, FORT WORTH and CUSTOMER have entered in an Agreement for Water Service known as Fort Worth City Secretary Contract No. 41111 (“CONTRACT”); and WHEREAS, the parties recognize that there is a need for additional water capacity in the northeast sector of Fort Worth and in Trophy Club Municipal Utility District 1; and WHEREAS, to address this need FORT WORTH is constructing a 48-inch water main from Heritage Trace Parkway to Alta Vista and Timberland Boulevard, approximately 11,713 linear feet as shown in EXHIBIT F.2a; and WHEREAS, CUSTOMER has requested capacity in the proposed water main which will increase its total projected water demand; and WHEREAS, Section 3.3 of the CONTRACT states that the CUSTOMER shall pay for each new or enlarged or additional connection to the FORT WORTH system, including the cost of the wholesale meter and the CUSTOMER’s proportionate share of the improvements required for that service; and WHEREAS, CUSTOMER recognizes that the City of Southlake, Town of Westlake and the City of Keller have also requested capacity in the proposed Northside II 48-inch water main; WHEREAS, the PARTIES agree that the CUSTOMER’s cost and participation for the Northside II 48-inch water main shall be as stated in this AMENDMENT. Trophy Club Municipal Utility District No. 1 58 of 69 December 4, 2014 - Special Meeting __________________________________________________________________________________________ Amendment:F.2 Northside II 48-inch Water main NOW THEREFORE, the PARTIES agree to amend the CONTRACT as follows: The CONTRACT shall be amend to include the following as EXHIBIT F.2 ALLOCATION OF COST AND CAPACITY FOR THE NORTHSIDE II 48-INCH WATER MAIN 1.) FORT WORTH shall be responsible for the preparation of plans and specifications, together with any modifications required during construction, and contract documents for the construction of the Northside II 48-inch water main, shown on Exhibit F2a. 2.) CUSTOMER requested an additional 2.4 MGD, increasing its existing capacity of 7.9 MGD to a total of 10.3 MGD at the meter location shown on Exhibit A to the CONTRACT. The additional 2.4 MGD equals to 4 percent of the proposed Northside II 48-inch water main’s 60 MGD capacity. The estimated total engineering and construction cost of the Northside II 48-inch water main is estimated $15,959,000. Customer agrees to pay FORT WORTH four percent (4%) that equals to $638,360 as its proportionate share of the cost. 3.) The cost of easements, appraisal fees, and right-of-way acquisitions is not included in the estimate above and shall be shared by FORT WORTH, CUSTOMER, Southlake, Keller and Westlake proportionately. 4.) The estimated engineering and construction costs presented herein are for planning purposes. Actual Project cost may differ and shall be adjusted to reflect the final cost of engineering, construction, easement and right-of- way acquisition and financing. Actual Project cost shall be shared by the PARTIES in the same percentage breakdown as designated for the estimated cost. 5.) CUSTOMER also agrees to pay its proportionate cost, to be shared with Trophy Club Municipal Utility District No.1, to upsize the water main from Caylor Tank to the Westlake water meter along Highway 377 as shown on EXHIBIT F.2b. This water main alignment is only for planning purpose and depends on future alignment study that determines the water main’s final route. CUSTOMER further agrees that it shall bear the full cost of upsizing the water main from the Westlake meter located at Highway 377 to Trophy Club’s meter. 6.) Nothing contained herein shall be construed so as to prevent FORT WORTH from including the costs it incurs hereunder as system costs as that term is defined in the CONTRACT with CUSTOMER. Trophy Club Municipal Utility District No. 1 59 of 69 December 4, 2014 - Special Meeting __________________________________________________________________________________________ Amendment:F.2 Northside II 48-inch Water main 7.) All payments are due and payable within 30 days from the date the Northside II 48-inch water main is completed. A payment is late if not paid within 10 days from the due date. Late payments shall accrue interest at the rate of one and one-half percent (1-1/2%) per month until paid. 8.) If the CUSTOMER exceeds the requested capacity, then the CUSTOMER will be required to provide additional cost participation toward the proposed 48-inch water main. The additional cost participation will be required at the time when the CUSTOMER’s wholesale meter’s reading exceed the 10.3 MGD projected demand. 9.) CUSTOMER has requested FORT WORTH to amend the CUSTOMER’s service area map as shown on EXHIBIT A of the CONTRACT to the revised EXHIBIT A in this amendment. This AMENDMENT shall become effective upon full and complete execution of each party below: AMENDED AND EXECUTED this the 4th day of December, 2014. CITY OF FORT WORTH TROPHY CLUB MUNICIPAL DISTRICT NO. 1 _______________________________ _______________________________ FERNANDO COSTA JENNIFER MCKNIGHT ASSISTANT CITY MANAGER GENERAL MANAGER DATE: ________________________ DATE: ________________________ APPROVED AS TO FORM AND APPROVED AS TO FORM AND LEGALITY LEGALITY _______________________________ _______________________________ CHRISTA LOPEZ-REYNOLDS PAMELA LISTON SR. ASSISTANT CITY ATTORNEY DISTRICT LEGAL COUNSEL ATTEST ATTEST ________________________________ _______________________________ MARY KAYSER LAURIE SLAGHT CITY SECRETARY DISTRICT SECRETARY Trophy Club Municipal Utility District No. 1 60 of 69 December 4, 2014 - Special Meeting __________________________________________________________________________________________ Amendment:F.2 Northside II 48-inch Water main EXHBIT “F.2a” – 48-inch water main from Heritage Trace Parkway to Alta Vista and Timberland Boulevard Trophy Club Municipal Utility District No. 1 61 of 69 December 4, 2014 - Special Meeting Trophy Club Municipal Utility District No. 162 of 69December 4, 2014 - Special Meeting Trophy Club Municipal Utility District No. 163 of 69December 4, 2014 - Special Meeting __________________________________________________________________________________________ Amendment:F.2 Northside II 48-inch Water main EXHBIT “F.2b” – water main from Caylor Tank to the Westlake water meter along Highway 377 Trophy Club Municipal Utility District No. 1 64 of 69 December 4, 2014 - Special Meeting UT "C`DENTONALLIANCE GATEWAY INDEPENDENCEKELLER HASLET WESTPORT Keller Westlake Roanoke Tarrant Denton ¹W:\Groups\Engineering\Development\Wholesale\48-inch Cost Participation from Keller, Southlake, Westlake, and Trophy Club\Westlake_Exhibit_F_2b.mxd (vkamin) 11/20/2014NAD 1983 StatePlane Texas North Central FIPS 4202 Feet COPYRIGHT 2011 CITY OF FORT WORTHUNAUTHORIZED REPRODUCTION IS A VIOLATION OF APPLICABLE LAWS. THIS DATA IS TO BE USED FOR A GRAPHICAL REPRESENTATION ONLY.THE ACCURACY IS NOT TO BE TAKEN / USED AS DATA PRODUCED FOR ENGINEERING PURPOSES OR BY A REGISTERED PROFESSIONAL LANDSURVEYOR. THE CITY OF FORT WORTH ASSUMES NO RESPONSIBILITYFOR THE ACCURACY OF SAID DATA.For general purpose only. Contact City of Fort Worth Transportation and Public Works at 817-392-8426 to get plan information for design or construction purposes.Maps with aerial and contour information are prohibited from reproduction and distribution without prior consent from the North Central Texas Council of Governments.EXHIBIT F.2b Caylor Tank Westlake Wholesale Meter Trophy Club Municipal Utility District No. 1 65 of 69 December 4, 2014 - Special Meeting __________________________________________________________________________________________ Amendment:F.2 Northside II 48-inch Water main EXHBIT “A” – Corrected Service Area Map Trophy Club Municipal Utility District No. 1 66 of 69 December 4, 2014 - Special Meeting Trophy Club Municipal Utility District No. 1 67 of 69 December 4, 2014 - Special Meeting TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 ORDER NO. 2014-1204B ORDER ADOPTING PUBLIC PRESENTATIONS POLICY STATE OF TEXAS § COUNTIES OF DENTON AND TARRANT § WHEREAS, Section 49.057(g) of the Texas Water Code, as amended, provides that the Board of Directors may adopt rules to govern the affairs of the District; WHEREAS, Section 551.023 of the Open Meetings Act provides that the Board of Directors may adopt reasonable rules to maintain order at their meetings; WHEREAS, the Board of Directors desire to set forth a policy regarding visual presentations provided at public meetings by directors, staff, consultants, other entities, and members of the public to ensure the safety and security of person’s in attendance and to maintain the security of the District’s Information Technology network system. NOW, THEREFORE, BE IT ORDERED BY THE BOARD OF DIRECTORS OF TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1, THAT: Section 1. All presentation materials that are to be presented to and/or viewed by directors and the public either in paper form or through an audio-visual system owned or operated by the District must be reviewed and approved by the General Manager or his/her designee prior to the meeting. The General Manager’s approval is based solely on the safety of an electronic file (i.e. scanned for viruses) and/or to ensure the content of the presentation does not contain violent, sexual, and/or vulgar content and is acceptable for all audiences. Section 2. All presentations to be presented through an audio-visual system owned or operated by the District must be submitted electronically either via email or on a flash drive. Section 3. Presentations submitted for review and approval must be provided to the General Manager at least two (2) business days in advance of the meeting date in accordance with procedures set by the General Manager to allow sufficient time for review and approval. Presentations will be placed on District equipment by District staff prior to the meeting and will be ready for presentation at the meeting. In limited situations, unforeseen circumstances may prohibit the General Manager from timely review of presentation materials for the impending meeting. In that instance, use of the presentation materials will be postponed until the next regular meeting. Section 4. Presenters are required to provide the District Secretary with one paper copy of a presentation and/or presentation materials so these can be included as part of the official meeting records and failure to do so will result in denial of the use of District equipment and/or distribution of materials during the meeting. Section 5. A speaker may request to have his or her presentation or supporting information provided to the Board. Speakers must provide 10 copies of any handouts or supporting information to the District Secretary not less than 15 minutes before the scheduled meeting. District staff cannot make copies of paper materials to be provided to the Board. Trophy Club Municipal Utility District No. 1 68 of 69 December 4, 2014 - Special Meeting Section 6. All presentations, handouts, and other documents distributed and/or presented at District meetings are public records pursuant to the Texas Public Information Act and may be posted on the District’s website and/or provided to the public upon request. APPROVED AND ADOPTED on this 4th day of December, 2014. Jim Moss, President Board of Directors ATTEST: Kevin R. Carr, Secretary Board of Directors (SEAL) Laurie Slaght, District Secretary Trophy Club Municipal Utility District No. 1 Trophy Club Municipal Utility District No. 1 69 of 69 December 4, 2014 - Special Meeting