RES 15-25 Floreo CFD SARB Sr. 2025 - Authorizing Bonds - includes CDU and Tax Policies (005) (6.18.25)(6565653.5).pdf
City of Buckeye — Joint Community Facilities Districts (2025-07-01)
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RESOLUTION NO. 15-25 (Floreo at Teravalis)
RESOLUTION OF THE BOARD OF DIRECTORS OF THE FLOREO AT
TERAVALIS COMMUNITY FACILITIES DISTRICT (CITY OF BUCKEYE,
ARIZONA) AUTHORIZING THE ISSUANCE OF ITS SPECIAL ASSESSMENT
DISTRICT NO. 1 SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2025,
IN THE AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED $10,970,000;
APPROVING THE FORM AND AUTHORIZING THE EXECUTION AND
DELIVERY OF A BOND REGISTRAR, TRANSFER AGENT AND PAYING
AGENT CONTRACT, A PURCHASE CONTRACT RELATING TO THE BONDS,
A CONTINUING DISCLOSURE UNDERTAKING, AND CERTAIN OTHER
DOCUMENTS SECURING THE PAYMENT OF OR RELATING TO THE BONDS;
RATIFYING AND APPROVING A PRELIMINARY OFFICIAL STATEMENT
RELATING TO THE BONDS; APPROVING A FINAL OFFICIAL STATEMENT
RELATING TO THE BONDS; AWARDING THE BONDS TO THE PURCHASER
THEREOF; APPOINTING A REGISTRAR, TRANSFER AGENT AND PAYING
AGENT FOR THE BONDS; TAKING OTHER ACTIONS SECURING THE
PAYMENT OF AND RELATING TO THE BONDS; RATIFYING ALL ACTIONS
TAKEN OR TO BE TAKEN TO FURTHER THIS RESOLUTION; AND
ADOPTING
WRITTEN
CONTINUING
DISCLOSURE
COMPLIANCE
PROCEDURES AND ISSUANCE AND POST-ISSUANCE TAX COMPLIANCE
PROCEDURES IN CONNECTION WITH THE ISSUANCE OF BONDS.
BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE FLOREO AT TERAVALIS
COMMUNITY FACILITIES DISTRICT (CITY OF BUCKEYE, ARIZONA), as follows:
Section 1.
Findings.
(a)
Pursuant to Title 48, Chapter 4, Article 6 of the Arizona Revised Statutes,
as amended (the “Enabling Act”), the Waiver Agreement described below and Resolution No. 09-
25 (Floreo at Teravalis) adopted on June 17, 2025 (the “Resolution of Intention”), the Board of
Directors (the “District Board”) of the Floreo at Teravalis Community Facilities District (City of
Buckeye, Arizona) (the “District”) has formed Special Assessment District No. 1 (the “Assessment
District No. 1”), approved an assessment diagram and its recording in the Office of the
Superintendent of Streets of the District (the “Superintendent”) and declared its intention to: (i)
acquire certain public infrastructure and pay costs and expenses related thereto, including funding
a debt service reserve fund (the “Project”); (ii) assess the costs and expenses of the Project upon
certain benefited real property within the boundaries of the District as described in the Resolution
of Intention; (iii) issue the District’s special assessment revenue bonds (the “Bonds”) to finance
the Project; and (iv) order the public infrastructure projects performed as described in the
Resolution of Intention.
(b)
Pursuant to the terms and provisions of the Floreo at Teravalis Community
Facilities District (City of Buckeye, Arizona) Waiver and Development Agreement Pertaining to
the to be Formed Assessment District No. 1 dated as of June 6, 2025, recorded with the Maricopa
County, Arizona Recorder, at Docket No. 2025-0327590 (the “Waiver Agreement”), Trillium Land
Company, LLC (“Owner”) and the owners of the land within the District (or holders of options to
purchase land within the District that execute an Interested Party Consent, Waiver and Agreement
attached to the Waiver Agreement (collectively referred to as the “Interested Parties”) have
waived, among other things, certain requirements relating to the notices, protests and hearings
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relating to, among other things, the formation of Assessment District No. 1, levying of the
Assessments (as hereinafter defined), and the time period for cash payments.
(c)
The District Board has caused a report of the feasibility and benefits of the
Project to be prepared, such report included a description of certain public infrastructure to be
acquired and all other information useful to understand the Project, a map showing, in general,
the location of the Project, an estimate of the cost to acquire, operate and maintain the Project,
an estimated schedule for completion of the Project, a map or description of the area to be
benefited by the Project, and a plan for financing the Project (the “Report”). A public hearing on
the Report was held June 17, 2025, as provided by law, and, pursuant to the Enabling Act and
the Resolution of Intention, the Report was ratified and approved in all respects.
(d)
Pursuant to and in reliance upon the Waiver Agreement, the District Board
adopted Resolution No. 10-25 (Floreo at Teravalis) on June 17, 2025, ordering the public
infrastructure projects performed as described in the Resolution of Intention.
(e)
Pursuant to and in reliance upon the Waiver Agreement, the District Board
adopted Resolution No. 11-25 (Floreo at Teravalis) on June 17, 2025, approving the levying of an
assessment (the “Assessment” or the “Assessments”) against the real property in Assessment
District No. 1. Pursuant to the Waiver Agreement and other agreements by the Owner and the
Interested Parties, the Owner and the Interested Parties waived the requirement for notices of
cash demands, the opportunity to make cash payments and requested the unpaid Assessments
go to bond.
(f)
Pursuant to the terms and provisions of the Waiver Agreement, the Owner
and the Interested Parties, among other things, approved the: (i) proceedings relating to the
Assessment and the Bonds, (ii) Assessment and assessment diagram, (iii) assessment
methodology, (iv) method of collection and foreclosure of Assessments and (v) terms of the
Bonds.
(g)
The District Board has determined to authorize the issuance of the Bonds
described herein to provide funds for the Project and any and all of the public infrastructure
purposes provided for in the Enabling Act and the General Plan of the District.
(h)
Pursuant to the Enabling Act, the District has also determined to enter into
a Bond Registrar, Transfer Agent and Paying Agent Contract, dated as of August 1, 2025, or such
other date as set forth in the hereinafter defined Purchase Contract for the sale of the Bonds (the
“Registrar/Paying Agent Contract”), between the District and U.S. Bank Trust Company, National
Association, as bond registrar, transfer agent and paying agent (the “Registrar” and “Paying
Agent” as the case may be), to process the issuance, registration, transfer and payment of, the
Bonds. The District Board has determined by this Resolution to authorize the issuance of the
Bonds and, in order to provide terms for, to provide for authentication and delivery of the Bonds
by the Registrar, to authorize the execution and delivery of the Registrar/Paying Agent Contract.
(i)
There have been placed on file with the District Clerk and presented in
connection herewith (i) the proposed form of the Registrar/Paying Agent Contract, (ii) the
proposed form of the Purchase Contract relating to the Bonds (the “Purchase Contract”), by and
between the District and Raymond James & Associates, Inc. (the “Underwriter”), (iii) the
Preliminary Official Statement relating to the Bonds, dated the date thereof (the “Preliminary
Official Statement”), and which, with such completions and changes as may be necessary will
constitute the form of the Final Official Statement for the Bonds (the “Final Official Statement”),
and (iv) the proposed form of Continuing Disclosure Undertaking relating to the Bonds, to be
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dated the date of delivery thereof. The documents described in Clauses (i) through (iv) of this
paragraph are hereinafter referred to, collectively, as the “Bond Documents.”
(j)
The District Board hereby finds and determines that: (i) the amount of the
Bonds does not exceed the estimated cost of the Project plus all costs connected with the public
infrastructure purposes, capitalized interest, a debt service reserve fund and issuance and sale
of the Bonds to be financed therewith (collectively the “Costs”); (ii) the Costs are less than or
equal to the benefits derived from the Project; and (iii) based upon an appraisal completed by
Schnepf Ellsworth Appraisal Group LLC, dated April 17, 2025, the land value of the assessed
parcels comprising Assessment District No. 1 (prior to improvements being installed) to debt ratio
of at least six to one prior to the issuance of the Bonds.
Section 2.
Approval of Issuance and Sale of Bonds; Payment of Bonds.
(a)
The Bonds are hereby authorized to be issued as a series of tax-exempt
assessment bonds of the District to be designated “Special Assessment District No. 1 Special
Assessment Revenue Bonds, Series 2025.” If the Bonds are issued in a different calendar year,
the officers of the District are hereby authorized and directed to change the series designation.
The Bonds shall be issued and delivered in an aggregate principal amount of not to exceed
$10,970,000, shall be in fully registered form only, shall be dated as of their date of initial issuance,
shall bear interest at the rate or rates set forth in the Purchase Contract (not to exceed 8.00%)
from their date and shall mature on July 1 in some or all of the years 2026 through 2045, inclusive
(each, a “Principal Payment Date”). Interest will be payable semiannually, commencing on
January 1, 2026 (or on such other date as set forth in the Purchase Contract), and on each
succeeding January 1 and July 1 (each such date shall be referred to as an “Interest Payment
Date”) during the term of the Bonds. The Bonds will bear interest from the most recent Interest
Payment Date to which interest has been paid or duly provided for or, if no interest has been paid,
from the date of their initial delivery, calculated on the basis of a 360-day year of twelve 30-day
months. As initially issued, the Bonds shall be in the Book-Entry-Only System described herein
and in the denomination of $5,000 each or integral multiples of $1,000 in excess thereof and shall
be in fully registered form. If necessary, to accommodate a special redemption of Bonds pursuant
to Section 3(a) hereof, Bonds may be in the denomination of less than $5,000 in integral multiples
of $1,000. Costs of issuance shall be paid by the Owner.
(b)
The principal of and premium, if any, on the Bonds shall be payable upon
surrender thereof at the principal corporate trust office of the Paying Agent. Interest due on the
Bonds on each Interest Payment Date shall be payable by check mailed, when due, to the persons
(the “Bondholders”) in whose names the Bonds are registered by the Registrar at the close of
business on the fifteenth day of the calendar month (other than a Saturday, a Sunday, or a legal
holiday or equivalent (other than a moratorium) for banking institutions generally (a “Business
Day”)) next preceding the applicable Interest Payment Date; if such day is not a Business Day,
then the previous Business Day (the “Record Date”).
(c)
In the event that interest is not paid on an Interest Payment Date, the
Registrar shall establish a special record date for the payment of such interest, if and when funds
for the payment of such interest have been received. Notice of the special record date and of the
scheduled payment date of the past due interest will be sent at least 10 days prior to the special
record date, to the address of each Bondholder appearing on the Register (as such term is
hereafter defined).
(d)
Reserved.
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(e)
The Bonds shall have such additional terms and provisions as are set forth
in the Purchase Contract and in the form of Bond attached hereto as Exhibit A, which is a part of
this Resolution.
Section 3.
Prior Redemption.
(a)
Special Optional Redemption. All Bonds are subject to special optional
redemption prior to their stated maturity at the option of the District, in whole or in part, on any
Interest Payment Date upon payment of the applicable Redemption Price which shall consist of
the principal amount of the Bonds so redeemed, plus accrued interest, if any, on the Bonds so
redeemed from the most recent Interest Payment Date to the applicable redemption date without
premium: (i) if and to the extent on or after the completion of the Project, upon direction given to
the Registrar by the District, amounts transferred from the Acquisition Fund for such purpose;
(ii) from the prepayment of any assessment by the owner of any assessed real property or (iii)
from the proceeds of any sale of any delinquent assessed real property to the extent such
foreclosure sale proceeds are not used to replenish the Debt Service Reserve Fund to an amount
equal to the Reserve Fund Requirement. Such proceeds shall be deposited with the Bond
Registrar and Paying Agent at least two business days prior to the date of redemption. The
special redemption shall be at a redemption price of par plus interest accrued to the date of
redemption, without premium.
(b)
Optional Redemption. The Bonds shall be subject to call for redemption
prior to their stated maturity dates, at the option of the District, on such dates and at such price
(the “Redemption Price”) as are set forth in the Purchase Contract.
(c)
Mandatory Redemption. The Bonds shall be subject to mandatory
redemption prior to their stated maturity dates, at a Redemption Price of par plus interest accrued
to the date of redemption, but without premium, on such dates and in such amounts as are set
forth in the Purchase Contract. Whenever Bonds which are subject to mandatory redemption are
purchased, redeemed (other than pursuant to mandatory redemption) or delivered by the District
to the Registrar for cancellation, the principal amount of the Bonds so retired shall satisfy and be
credited against any mandatory redemption requirements for the Bonds for such years as the
District may direct.
(d)
Notice of Redemption. So long as the Bonds are held under the Book-
Entry-Only System described below, notices of redemption will be sent to The Depository Trust
Company (“DTC”) in the manner required by DTC. If the Book-Entry-Only System is discontinued,
notice of redemption of any Bond will be mailed to the registered owner of the Bond or Bonds
being redeemed at the address shown on the bond register maintained by the Registrar not more
than 60 nor less than 30 days prior to the date set for redemption. Notice of redemption may be
sent to any securities depository by mail, facsimile transmission, wire transmission or any other
means of transmission of the notice generally accepted by the respective securities depository.
Neither the failure of DTC nor any registered owner of Bonds to receive a notice of redemption
nor any defect therein will affect the validity of the proceedings for redemption of Bonds as to
which proper notice of redemption was given.
(e)
MSRB Notice. Notice of any redemption will also be sent to the Municipal
Securities Rulemaking Board (the “MSRB”), currently through the MSRB’s Electronic Municipal
Market Access system, in the manner required by the MSRB, but no defect in said further notice
or record nor any failure to give all or a portion of such further notice shall in any manner defeat
the effectiveness of a call for redemption if notice thereof is given as prescribed above. If moneys
for the payment of the redemption price and accrued interest are not held in separate accounts
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by the District, or a Paying Agent prior to sending the notice of redemption, such redemption shall
be conditional on such moneys being so held on the date set for redemption and if not so held by
such date, the redemption shall be cancelled and be of no force and effect.
(f)
Effect of Call for Redemption. On the date designated for redemption by
notice given as herein provided, the Bonds so called for redemption shall become and be due
and payable at the Redemption Price provided for redemption of such Bonds on such date, and,
if moneys for payment of the Redemption Price are held in separate accounts by the Paying
Agent, interest on such Bonds or portions of Bonds so called for redemption shall cease to accrue,
such Bonds shall cease to be entitled to any benefit or security hereunder and the Bondholders
shall have no rights in respect thereof except to receive payment of the Redemption Price thereof
and such Bonds shall be deemed paid and no longer outstanding.
(g)
Redemption of Less Than All of a Bond. The District may redeem an
amount which is included in a Bond in the denomination in excess of $5,000, but divisible by,
$1,000. However, in order to accommodate a special redemption of Bonds pursuant to Section
3(a) hereof, Bonds may be in a denomination of less than $5,000 in integral multiples of $1,000.
In that event, the registered Bondholder shall submit the Bond for partial redemption and the
Paying Agent shall make such partial payment and the Registrar shall cause to be issued a new
Bond in a principal amount which reflects the redemption so made to be authenticated and
delivered to the registered Bondholder thereof.
Section 4.
Form of Bonds. The Bonds shall be in substantially the form of Exhibit A,
attached hereto and incorporated by reference herein, with such necessary and appropriate
omissions, insertions and variations as are permitted or required hereby or by the Purchase
Contract and are approved by those officers executing the Bonds and execution thereof by such
officers shall constitute conclusive evidence of such approval. The Bonds may have notations,
legends or endorsements required by law, securities exchange rule or usage. Each Bond shall
be dated the date of its authentication and registration.
Section 5.
Execution of Bonds and Other Documents.
(a)
Execution of Bonds. The Bonds shall be executed for and on behalf of the
District by the Chair of the District Board (the “Chair”) and attested by the Clerk of the District
Board (the “District Clerk”) by their manual or facsimile signatures. If the signatures are affixed
or imprinted by facsimile, the Chair and the District Clerk shall execute a certificate adopting as
their signatures the facsimile signatures appearing on the Bonds. If an officer whose signature is
on a Bond no longer holds that office at the time the Bond is authenticated and registered, the
Bond shall nevertheless be valid. A Bond shall not be valid or binding until authenticated by the
manual signature of an authorized officer of the Registrar. The signature shall be conclusive
evidence that the Bond has been authenticated and issued under this Resolution.
(b)
Other Documents. The District Board hereby approves the form and orders
and directs the execution of the Bond Documents, each in substantially the form presented to the
District Board. The Treasurer of the District (the “District Treasurer”) is authorized and directed
to determine and approve the actual dated date, maturity dates and amounts, interest rates,
redemption provisions and the purchase price to be paid by the Underwriter, and the Chair and
the District Treasurer are authorized to execute and deliver the Bond Documents in substantially
the form presented to this District Board with such necessary and appropriate omissions,
insertions and variations as are permitted or required hereby and are approved by those officers
executing such agreements on behalf of the District. Execution of the documents by the Chair or
the District Treasurer shall be conclusive evidence of such approval. The District Clerk is
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authorized and directed to attest such signatures. Where applicable, any of the foregoing officers
may affix their signatures by manual, mechanical or photographic means.
Section 6.
Mutilated, Lost or Destroyed Bonds. In case any Bond becomes mutilated
or destroyed or lost, the District shall cause to be executed and delivered a new Bond of like date
and tenor in exchange and substitution for and upon the cancellation of such mutilated Bond or
in lieu of and in substitution for such Bond destroyed or lost, upon the registered Bondholder’s
paying the reasonable expenses and charges of the District in connection therewith and, in the
case of the Bond destroyed or lost, filing with the District Clerk by the registered Bondholder
evidence satisfactory to the District that such Bond was destroyed or lost, and furnishing the
District with a sufficient indemnity bond pursuant to A.R.S. § 47-8405, as amended.
Section 7.
Acceptance of Proposal. The Bonds are hereby sold to the Underwriter in
accordance with the terms of the Purchase Contract. The Underwriter has agreed to sell the
Bonds in a public offering. The actual terms of the Bonds and the Purchase Contract shall be
reviewed and approved by the District Treasurer (which approval shall be deemed conclusive by
the execution and delivery of the Purchase Contract by the Chair, any member of the District
Board or the District Treasurer). The District Treasurer is hereby authorized and directed to cause
the Bonds to be delivered to or upon the order of the Underwriter upon receipt of payment therefor
and satisfaction of the other conditions for delivery thereof in accordance with the terms of the
sale and to indicate how such proceeds and the Owner contribution (as described in the
hereinafter defined Tax Certificate) shall be deposited in the funds described in Section 8 hereof.
Section 8.
Funds and Accounts. The District Treasurer shall create the following
funds and accounts which shall be held separate and apart from other funds and accounts of the
District and used only as provided herein:
(a)
“Bond Fund”, as described in Section 9 hereof, which shall include:
(i)
Principal Account
(ii)
Interest Account
(iii)
Prepayment Account
(b)
“Acquisition Fund”, as described in Section 10 hereof.
(c)
“Issuance and Expenses Fund”, as described in Section 11 hereof.
(d)
“Debt Service Reserve Fund”, as described in Section 12 hereof.
The money deposited to the various funds and accounts created hereby, together with all
investments thereof and investment income therefrom, shall be held in trust by the District and
applied solely as provided herein.
Section 9.
Deposits to and Application of Bond Fund.
(a)
The District shall deposit or shall cause, at the applicable times set forth
below, to be immediately deposited to the Bond Fund to the credit of the applicable accounts:
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(i)
to the Principal and Interest Accounts, as applicable, upon receipt,
all amounts collected by or remitted to the District from the collections of the installments
of principal and interest, respectively, on the Assessments;
(ii)
to the Prepayment Account, upon receipt (A) those amounts
designated for deposit to the Prepayment Account from proceeds of the Bonds upon
closing and (B) all amounts remitted to the District as prepayments of the Assessments;
(iii)
to the Prepayment Account, upon receipt, all amounts remitted to
the District as proceeds from any foreclosure sale of any assessed real property and not
used to replenish the Reserve Fund to an amount equal to the lesser of: (A) 10% of the
outstanding principal amount of the Bonds to be outstanding after redemption from such
account; (B) an amount equal to, at the time of computation, the greatest annual payment
of principal and interest of the Bonds to be outstanding after redemption from such account
occurring in the then-current, or any subsequent, fiscal year (the “Maximum Annual Debt
Service”); or (C) 125% of the average annual debt service on the Bonds outstanding, or
such amount as required by the Internal Revenue Code of 1986, as amended (the “Code”),
to obtain or maintain the exclusion of interest from gross income for federal income tax
purposes for the Bonds, pursuant to an opinion of bond counsel (the “Reserve Fund
Requirement”);
(iv)
to the Prepayment Account, amounts transferred from the
Acquisition Fund to the extent hereinafter provided;
(v)
to the Principal and Interest Accounts, as the case may be, amounts
transferred from the Debt Service Reserve Fund as hereinafter provided pursuant to
Section 12(b), (d) and (f);
(vi)
to the Prepayment Account, any amounts transferred from the Debt
Service Reserve Fund as hereinafter provided pursuant to Section 12(e); and
(vii)
such other funds as the District shall, from time to time, at its option
deem advisable.
(b)
The Principal, Interest and Prepayment Accounts of the Bond Fund shall
be applied solely to pay principal of (including any mandatory redemption amount then due),
interest on and the Redemption Price with respect to the Bonds, respectively.
Section 10.
Acquisition Fund.
(a)
The District shall deposit the Bond proceeds to the Acquisition Fund in the
amount provided in the District’s Tax Certificate relating to the Bonds (the “Tax Certificate”).
(b)
The date of completion of the Project (the “Completion Date”) shall be
evidenced to the District by a certificate signed by the Owner stating that:
(i)
The Project has been completed in accordance with the plans and
specifications therefor (such certification can rely upon the opinion of an inspector or
consultant retained by the Owner), and all labor, services, materials and supplies used in
the Project have been paid for and acknowledgments of such payments have been
obtained from all contractors and suppliers; and
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(ii)
All other facilities necessary in connection with the Project have
been constructed, acquired and installed in accordance with the plans and specifications
therefor (such certification can rely upon the opinion of an inspector or consultant retained
by the Owner), and all costs of acquisition of the Project have been paid.
Notwithstanding the foregoing, such certificate shall state that it is given without
prejudice to any rights against third parties that exist at the date of such certificate or which may
subsequently come into being. Within 10 days following the Completion Date, the District shall
transfer any balance in the Acquisition Fund (except moneys retained for expenses not yet due
and payable) into the Prepayment Account in the Bond Fund for application to the redemption of
Bonds.
Notwithstanding anything contained in this Section 10, on August 1, 2028 (or such
other date as described in the District’s Tax Certificate), any amounts remaining in the Acquisition
Fund shall be transferred to the Prepayment Account of the Bond Fund and applied to the
redemption of Bonds.
Section 11.
Issuance and Expenses Fund. The money deposited to the Issuance and
Expenses Fund, together with all investments thereof and investment income therefrom, shall be
held in trust by the District. The District shall deposit to the Issuance and Expenses Fund Bond
proceeds and an Owner contribution in the amounts provided in the Tax Certificate. Upon a
request for disbursement, amounts on deposit in the Issuance and Expenses Fund shall be
applied to pay all costs of the issuance and sale of the Bonds identified in a request signed by
either the Chair, the District Manager or the District Treasurer. On December 1, 2025 (or such
other date as described in the District’s Tax Certificate), the District shall transfer any moneys in
the Issuance and Expenses Fund to the Prepayment Account of the Bond Fund for application to
the redemption of the Bonds.
Section 12.
Debt Service Reserve Fund.
(a)
The District shall deposit Bond proceeds to the Debt Service Reserve Fund
in the amount of the Reserve Fund Requirement as provided in the Tax Certificate.
(b)
On, or, if either day is not a Business Day, before December 30, 2025, and
before June 29 and December 30 each year thereafter, the District shall, to the extent the moneys
in the Debt Service Reserve Fund exceed the Reserve Fund Requirement, transfer from the Debt
Service Reserve Fund to the Principal and Interest Accounts of the Bond Fund the difference
between the amount in the Bond Fund on such date and the amount necessary to pay the principal
of and interest, respectively, on the Bonds on the next succeeding July 1 or January 1, as the
case may be.
(c)
If, after a Debt Service Reserve Fund withdrawal, the Debt Service Reserve
Fund is less than the Reserve Fund Requirement, the District shall reimburse the Debt Service
Reserve Fund, to the extent moneys are realized, from either: (i) the proceeds from the sale of
delinquent Assessments, which sales are conducted in the manner described in A.R.S. §§ 48-
601 through 48-607, inclusive, as amended from time to time; provided, however, A.R.S. § 48-
607 is revised to require the sales proceeds to be deposited to the Debt Service Reserve Fund
and neither the District nor the City of Buckeye, Arizona (the “City”) shall be required under any
circumstances to purchase, or make any payment for the purchase of the delinquent Assessment
and corresponding assessed parcel or lot; or (ii) from all future installment payments on the
Assessments; provided, however, only to the extent that such portion of such installment
payments is not required for the timely payment of principal of and interest on the Bonds.
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(d)
Any investment profits realized from the investment of moneys in the Debt
Service Reserve Fund shall remain in and be part of the Debt Service Reserve Fund; provided,
however, if moneys in the Debt Service Reserve Fund are in excess of the Reserve Fund
Requirement, such excess amount attributed to investment earnings shall be transferred to the
Interest Account of the Bond Fund and applied from time to time pursuant to Section 9 hereof.
(e)
If the amount held in the Debt Service Reserve Fund, together with the
amount held in the Bond Fund, is sufficient to pay the principal amount of all outstanding Bonds
on a date of redemption thereof, together with the interest accrued on such Bonds as of such date
of redemption, the moneys shall be transferred to the Prepayment Account of the Bond Fund and
thereafter used to redeem all Bonds as of such date of redemption.
(f)
On, or, if either day is not a Business Day, before December 30, 2025, and
before June 29 and December 30 each year thereafter, the District shall, to the extent the moneys
in either the Principal Account or Interest Account are insufficient to pay the principal of or interest
on the Bonds on the next succeeding Interest Payment Date or Principal Payment Date, as
applicable, after any transfer required pursuant to Section 12(b) hereof, transfer from the Debt
Service Reserve Fund to the Principal and Interest Accounts of the Bond Fund the difference
between the amount in the Bond Fund on such date and the amount necessary to pay the principal
of and interest, respectively, on the Bonds on the next succeeding Interest Payment Date or
Principal Payment Date, as the case may be.
Section 13.
Investment of and Security for Funds. Money held for the credit of any fund
or account herein created shall be invested pursuant to A.R.S. § 35-323.
Section 14.
Registrar and Paying Agent. Pursuant to the Registrar/Paying Agent
Contract, the Registrar will maintain an office or agency where Bonds may be presented for
registration of transfer and the Paying Agent will maintain an office or agency where Bonds may
be presented for payment. The District may appoint one or more co-registrars or one or more
additional paying agents. The Registrar and the Paying Agent may make reasonable rules and
set reasonable requirements for their respective functions with respect to the Bondholders.
(a)
Initially, U.S. Bank Trust Company, National Association, Tempe, Arizona,
will act as Registrar and Paying Agent with respect to the Bonds. The District may change the
Registrar or Paying Agent without notice to or consent of the Bondholders and the District may
act in any such capacity.
(b)
Each Paying Agent will be required to agree in writing that the Paying Agent
will hold in trust for the benefit of the Bondholders all moneys held by the Paying Agent for the
payment of principal of and interest and any premium on the Bonds.
(c)
The Registrar may appoint an authenticating agent acceptable to the
District to authenticate Bonds. An authenticating agent may authenticate Bonds whenever the
Registrar may do so. Each reference herein to authentication by the Registrar includes
authentication by an authenticating agent acting on behalf and in the name of the Registrar and
subject to the Registrar’s direction.
(d)
The Registrar shall keep a register of the Bonds (the “Register”), the
registered Bondholders and of transfer of the Bonds. When Bonds are presented to the Registrar
or a co-registrar with a request to register transfer, the Registrar will register the transfer on the
registration books if its requirements for transfer are met and will authenticate and deliver one or
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more Bonds registered in the name of the transferee of the same principal amount, maturity and
rate of interest as the surrendered Bonds. Bonds presented to the Registrar for transfer after the
close of business on the Record Date and before the close of business on the next subsequent
Interest Payment Date will be registered in the name of the transferee, but the interest payment
will be made to the registered Bondholders shown on the books of the Registrar as of the close
of business on the Record Date.
(e)
The Registrar may, but need not, register the transfer of a Bond that has
been selected for redemption and need not register the transfer of any Bond for a period of 15
days before a selection of Bonds to be redeemed; if the transfer of any Bond that has been called
or selected for call for redemption in whole or in part is registered, any notice of redemption that
has been given to the transferor will be binding upon the transferee and a copy of the notice of
redemption will be delivered to the transferee along with the Bond or Bonds.
(f)
The Registrar shall authenticate Bonds for original issue up to $10,970,000
in aggregate principal amount upon the written request of the District Treasurer or other
authorized District officer. The aggregate principal amount of Bonds outstanding at any time may
not exceed that amount except for replacement Bonds as to which the requirements of the
Registrar and the District are met.
(g)
The amounts that are segregated by the District or deposited with the
Paying Agent to pay the principal of or interest on any Bonds becoming due on any due date shall
be held in trust for the benefit of the owner of such Bonds. Amounts so segregated or deposited
and held in trust shall constitute a separate trust fund for the benefit of the owner of such Bonds
entitled to such principal or interest, as the case may be. Amounts held by the District or Paying
Agent for the payment of the principal of (and premium, if any) or interest on the Bonds need not
be segregated from other funds, except to the extent required by law.
(h)
The District may at any time direct any Paying Agent to pay to the District
all money held by such Paying Agent, such amounts to be held by the District upon the same
trusts as those upon which such money was held by such Paying Agent, and, upon such payment
by any Paying Agent to the District, such Paying Agent shall be released from all further liability
with respect to such money.
(i)
In the event any check for payment of interest on a Bond is returned to any
Paying Agent unendorsed or is not presented for payment within two years from its payment date
or any Bond is not presented for payment of principal at maturity or redemption date, if amounts
sufficient to pay such interest or principal due upon such Bond shall have been made available to
such Paying Agent for the benefit of the Bondholder thereof, it shall be the duty of such Paying
Agent to hold such funds or invest the same in Governmental Obligations (as defined herein),
without liability for interest thereon, for the benefit of the owner of such Bond who shall thereafter
be restricted exclusively to such funds for any claim of whatever nature relating to such Bond or
amounts due thereunder. Such obligation of the Paying Agent to hold such funds shall continue
for two years and six months following the date on which such interest or principal payment
became due, whether at maturity or stated maturity, or at the redemption date, or otherwise, at
which time such Paying Agent shall surrender such unclaimed funds so held to the District,
whereupon any claim of whatever nature by the owner of such Bond arising under such Bond
shall be made upon the District.
(j)
So long as the Bonds are administered under DTC’s Book-Entry-Only
System of registration of the Bonds with DTC as securities depository for the Bonds described
herein, interest payments and principal payments that are part of periodic principal and interest
6565653.5
11
payments shall be paid to Cede & Co. or its registered assigns in same-day funds no later than
the time of payment established by DTC on each interest or principal payment date (or in
accordance with then existing arrangements between the District and DTC). The District has
entered into an agreement (the “Letter of Representations”) with DTC in connection with the
issuance of its bonds and, while the Letter of Representations is in effect, the procedures
established therein shall apply to the Bonds.
(k)
If the Book-Entry-Only System is discontinued, the Registrar’s registration
books will show the registered Bondholders. While the Bonds are subject to the Book-Entry-Only
System, the Bonds shall be registered in the name of Cede & Co., or its registered assigns. The
Bonds will be administered by the Registrar in a manner which assures against double issuance
and provides a system of transfer of ownership on the books of the Registrar in the manner set
forth in the Bonds.
(l)
If the Book-Entry-Only System is discontinued, interest on the Bonds will
be payable on each Interest Payment Date by check mailed to the Bondholder thereof at the
Bondholder’s address all as shown on the registration books maintained by the Registrar as of
the close of business of the Registrar on the Record Date.
(m)
If the Book-Entry-Only System is discontinued, principal of the Bonds will
be payable, when due, only upon presentation and surrender of the Bond at the designated
corporate trust office of the Paying Agent. Upon written request of a registered Bondholder of at
least $100,000 in principal amount of Bonds not less than 20 days prior to an Interest Payment
Date, all payments of interest and, if adequate provision for surrender is made, principal shall be
paid by wire transfer in immediately available funds to an account within the United States of
America designated by such Bondholder.
(n)
Notwithstanding any other provision of this Resolution, payment of principal
of and interest on any Bond that is held by a securities depository or Bonds subject to a Book-
Entry-Only System may be paid by the Paying Agent by wire transfer in “same day funds”.
(o)
Reserved.
Section 15.
Other Actions Necessary. The Chair (or any other member of the District
Board in the event the Chair is absent or unable to take the desired action), the District Manager,
the District Treasurer, the District Clerk and the officers of the District shall take all action
necessary or reasonably required to carry out, give effect to and consummate the transactions
contemplated by the Bond Documents and the Final Official Statement, including without
limitation, the execution and delivery of the closing and other documents required to be delivered
in connection with the sale and delivery of the Bonds.
Section 16.
Distribution of Disclosure Documents. The District hereby approves,
ratifies and authorizes the use by the Underwriter of copies of the Preliminary Official Statement
and the Final Official Statement, which shall be in substantially the form of the Preliminary Official
Statement presented at the meeting at which this Resolution was adopted, with such completions
and changes as may be acceptable to the District Manager or District Treasurer as are necessary
in connection with the offering and sale of the Bonds. The District hereby authorizes the Chair,
the District Manager and the District Treasurer to execute the instruments deeming the
Preliminary Official Statement as “final” as of its date for purposes of Rule 15c2-12 of the
Securities and Exchange Commission (the “Rule”). The Chair, the District Manager and the
District Treasurer are hereby authorized and directed to execute, when completed, the Final
Official Statement.
6565653.5
12
Section 17.
Assessment Levy and Procedures.
(a)
An Assessment has been levied and recorded in the office of the
Superintendent against each lot comprising the parcels of real property in Assessment District
No. 1 and described in the Resolution of Intention. The Assessment levied and recorded may
hereafter be reduced to the actual principal amount of Bonds issued and any such reduction is
hereby approved by the District Board.
(b)
For each year while any Bond is outstanding, the District Board shall semi-
annually cause to be collected such portion of the Assessment, sufficient, together with any
moneys from any sources in the Enabling Act, to pay principal and interest on the Bonds when
due. Moneys received from the collection of the Assessment when collected constitute funds to
pay principal and interest on the Bonds when due and shall be kept separately from other funds
in the Bond Fund of the District. The amounts due pursuant to the Assessment and unpaid are
and shall be a first lien on the property so assessed in Assessment District No. 1, subject only to
general property taxes and prior special assessments and shall be collected as prescribed by
A.R.S. §§ 48-599 and 600, as amended, as nearly as practicable or such other procedures as the
District Board may prescribe. Notwithstanding the foregoing, the Assessments may be collected
by the Maricopa County Treasurer in a similar manner and together with the collection of real
property taxes, should the District Treasurer of the District so direct. In the event of nonpayment
of amounts due pursuant to the Assessment, the procedures for collection of delinquent amounts
and sale of delinquent property prescribed by A.R.S. §§ 48-601 through 48-607, as amended,
apply, as nearly as practicable, except that neither the District nor the City is required to purchase
the delinquent land at the sale if there is no other purchaser.
(c)
Pursuant to A.R.S. § 48-721, the provisions and procedures pertaining to
the prepayment of Assessments, the payment of Assessments and the reallocation and
modification of Assessments among the assessed parcels as development occurs, set forth in
this Resolution are hereby approved and adopted.
(d)
If any Assessment is either in whole or in part annulled, vacated or set
aside by the judgment of any court, or if the District is satisfied that any such Assessment is so
irregular or defective that the same cannot be enforced or collected, or if the District omitted to
make such Assessment when it might have done so, the District shall either (i) take all necessary
steps to cause a new Assessment to be made for the whole or any part of a Project or against
any property benefited by said Project, or (ii) in its sole discretion, request the Owner to make up
the amount of such Assessment, which moneys is deposited into the Bond Fund, as applicable.
In case such second Assessment is annulled, the District shall obtain and make other
Assessments until a valid Assessment is made.
Section 18.
No Obligation of City. Nothing contained in this Resolution, the Bond
Documents or any other instrument shall be construed as obligating the City or the State of
Arizona (the “State”) or any political subdivision of either (other than the District) or as incurring a
charge upon the general credit of the City and the State nor shall the breach of any agreement
contained herein, the Bond Documents or any other instrument or documents executed in
connection therewith impose any charge upon the general credit of the City and the State.
Section 19.
Repeal of Resolution. After any of the Bonds are delivered by the District
to the Underwriter upon receipt of payment therefor, this Resolution shall be and remain
irrepealable until the Bonds and the interest thereon have been fully paid, canceled and
discharged.
6565653.5
13
Section 20.
Severability. If any section, paragraph, clause or provision of this
Resolution is, for any reason, held to be invalid or unenforceable, the invalidity or unenforceability
of such section, paragraph, clause or provision shall not affect any of the remaining provisions of
this Resolution.
Section 21.
Ratification of Prior Acts. All acts of the District Chair, District Engineer,
the Superintendent of Streets, and any person acting for such official, in furtherance of this
Resolution are hereby ratified and confirmed, including the splitting of certain parcels within the
District in compliance with A.R.S. § 48-272.
Section 22.
Compliance with Federal Law.
(a)
The District recognizes that the purchasers of the Bonds will have accepted
them on, and paid therefore a price which reflects, the understanding that interest thereon is
excludable from gross income of the Bondholder thereof for federal income tax purposes under
laws in force at the time the Bonds are delivered. In this connection the District agrees that it
shall take no action that may render the interest on any of the Bonds to be includable in gross
income for federal income tax purposes. The District agrees that, to the extent possible under
State law, it will comply with whatever federal law is now in effect or which is adopted in the future
that applies to the Bonds and is necessary to prevent interest on the Bonds from becoming
included as gross income for purposes of calculating federal income taxes.
(b)
The District authorizes the creation of a fund which is hereinafter referred
to as the “Rebate Fund”. The District will comply with the rebate requirement (“Rebate”) set forth
in the District’s Tax Certificate.
(c)
The Chair or the Chair’s designee is hereby authorized to make certain
truthful certifications, representations, agreements and elections as required by law to assure the
purchasers and owners of the Bonds that the proceeds of the Bonds will not be used in a manner
that would or might result in the Bonds being “arbitrage bonds” under Section 148 of the Code or
the regulations of the United States Treasury Department currently in effect or proposed. The
certifications, representations and agreements of the District may be made by executing and
delivering certificates and agreements required by the District’s bond counsel, Gust Rosenfeld
P.L.C. The certificates and agreements shall constitute an agreement of the District to follow
covenants and requirements set forth therein that may require the District to take certain actions
(including the payment of certain amounts to the United States Treasury) or that may prohibit
certain actions (including the establishment of certain funds) under certain conditions.
(d)
The District further recognizes that Section 149(a) of the Code requires the
Bonds to be issued and to remain in fully registered form in order for interest thereon to be
excludable from gross income for purpose of federal income taxation under laws in force at the
time the Bonds are delivered. In this connection, the District agrees that it will not take any action
to permit the Bonds to be issued in, or converted into, bearer or coupon form if such action would
cause interest on the Bonds to be included in gross income for federal income tax purposes.
Section 23.
Reserved.
Section 24.
Defeasance.
(a)
Any Bond shall be deemed to be no longer outstanding when payment of
the principal of such Bond, plus interest thereon to the maturity thereof (whether such maturity be
6565653.5
14
by reason of the stated maturity thereof or call for redemption, if notice of such call has been given
or waived or irrevocable arrangements therefor satisfactory to the Registrar have been made)
have been provided for by depositing for such payment from funds of the District under the terms
provided in this Section (i) money sufficient to make such payment or (ii) money and direct or
indirect obligations of the United States of America (as approved by the District’s bond counsel)
(“Government Obligations”) certified by an independent accountant of national reputation to
mature as to principal and interest in such amounts and at such times as shall, without further
investment or reinvestment of either the principal amount thereof or the interest earnings
therefrom be sufficient to make such payment, provided that all necessary and proper fees,
compensation, and expenses of the Registrar and Paying Agent pertaining to the Bonds with
respect to which such deposit is made shall have been paid or the payment thereof provided for
to the satisfaction of the Registrar. Any such deposit shall be made either with the Paying Agent
or, if notice of such deposit is given to the Registrar and Paying Agent, with a state or nationally
chartered bank with a minimum combined capital and surplus of $50,000,000, as escrow agent,
with irrevocable instructions to transfer the amounts so deposited and investment income
therefrom to the Registrar or the Paying Agent in the amounts and at the times required to pay
principal of and interest on the Bonds with respect to which such deposit is made at the maturity
thereof and of such interest or the stated maturity, as the case may be. In the event such deposit
is made with respect to some but not all of the Bonds then outstanding, the outstanding Bonds
shall be selected in the same manner as provided for the selection of Bonds to be redeemed.
(b)
Notwithstanding anything herein to the contrary however, no such deposit
shall have the effect hereinabove described (i) if made during the existence of default hereunder
unless made with respect to all of the Bonds then outstanding and (ii) unless there shall be
delivered to the Registrar an opinion of counsel to the effect that such deposit shall not adversely
affect any exemption from federal income taxation of interest on any Bond. Any money and
Government Obligations deposited with the Paying Agent for such purpose shall be held by the
Paying Agent in a segregated account in trust for the Bondholders with respect to which such
deposit is made and together with any investment income therefrom, shall be disbursed solely to
pay the principal of and interest on the Bonds when due. No money or Government Obligations
so deposited pursuant to this Section shall be invested or reinvested unless in Government
Obligations and unless such money not invested, such Government Obligations not reinvested,
and such new investments are together certified by an independent accountant of national
reputation to be of such amounts, maturities, and interest payment dates and to bear such interest
as will, without further investment or reinvestment of either the principal amount thereof or the
interest earnings therefrom, be sufficient to make such payment. At such times as a Bond shall
be deemed to be paid hereunder, as aforesaid, it shall no longer be secured by or entitled to the
benefits of this Resolution, except for purposes of any such payment from such money or
Government Obligations.
Section 25.
Resolution a Contract. This resolution shall constitute a contract between
the District and the registered Bondholders and shall not be repealed or amended in any manner
that would impair, impede or lessen the rights of the Bondholders of the Bonds then outstanding.
Section 26.
Written Procedures to Comply with the Rule. The form of Continuing
Disclosure Compliance Procedures Regarding the Securities and Exchange Commission’s Rule
15c2-12 in substantially the form attached hereto as Exhibit B is hereby approved, and District
staff shall follow the procedures set forth therein as they relate to current and future continuing
disclosure compliance procedures required by the Bonds, or any other bonds or obligations of the
District.
6565653.5
15
Section 27.
Issuance and Post-Issuance Compliance Procedures. The form of the
Issuance and Post-Issuance Compliance Procedures Relating to Tax-Exempt Bonds and Other
Tax-Exempt Financings in substantially the form attached hereto as Exhibit C is hereby approved
and District staff shall follow the procedures set forth therein as it relates to issuance and post-
issuance compliance procedures required by the Bonds or any other bonds or tax-exempt
obligations of the District.
Section 28.
Effective Date. This Resolution shall be effective immediately.
[Signatures on following page]
6565653
PASSED, ADOPTED AND APPROVED by the Board of Directors of the Floreo at
Teravalis Community Facilities District (City of Buckeye, Arizona) on July 1, 2025.
FLOREO
AT
TERAVALIS
COMMUNITY
FACILITIES DISTRICT (CITY OF BUCKEYE,
ARIZONA)
District Chair
ATTEST:
District Clerk
APPROVED AS TO FORM:
Gust Rosenfeld P.L.C.
District Attorney/Bond Counsel
Attachments
Exhibit A:
Form of Bond
Exhibit B:
Continuing Disclosure Compliance Procedures Regarding the Securities
and Exchange Commission’s Rule 15c2-12 for the Floreo at Teravalis
Community Facilities District (City of Buckeye, Arizona)
Exhibit C:
Issuance and Post-Issuance Compliance Procedures Relating to Tax-
Exempt Bonds Other Tax-Exempt Financings for the Floreo at Teravalis
Community Facilities District (City of Buckeye, Arizona)
CERTIFICATE
I, Lucinda J. Aja, the duly appointed District Clerk of the Floreo at Teravalis Community
Facilities District (City of Buckeye, Arizona), do hereby certify that the above and foregoing
Resolution No. 15-25 (Floreo at Teravalis) was duly passed by the Board of Directors of the Floreo
at Teravalis Community Facilities District (City of Buckeye, Arizona), at a regular meeting held on
July 1, 2025, and the vote was ____ ayes, ____ nays, ____ abstained and ____ were absent,
and that the Chair and ___ Board Members were present thereat.
DATED: July 1, 2025.
Lucinda J. Aja, District Clerk
6565653.5
EXHIBIT A
Form of Bond
(consisting of 6 pages)
6565653.5
A-1
EXHIBIT A
[FORM OF BOND]
REGISTERED
REGISTERED
No. R-
$__________
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (“DTC”) TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO. HAS AN INTEREST HEREIN.
UNITED STATES OF AMERICA
STATE OF ARIZONA
FLOREO AT TERAVALIS COMMUNITY FACILITIES DISTRICT
(CITY OF BUCKEYE, ARIZONA)
SPECIAL ASSESSMENT DISTRICT NO. 1
SPECIAL ASSESSMENT REVENUE BOND, SERIES 2025
Interest Rate
Maturity Date
Original Issue Date
CUSIP No.
____%
July 1, 20__
_______, 202[5]
_________
REGISTERED OWNER: CEDE & Co.
PRINCIPAL AMOUNT: ______________________ AND NO/100 DOLLARS ($_________)
Floreo at Teravalis Community Facilities District (City of Buckeye, Arizona), a community
facilities district formed by the City of Buckeye, Arizona, and duly organized and validly existing,
pursuant to the laws of the State of Arizona (hereinafter referred to as the “Issuer”), for value received,
hereby promises to pay to the “Registered Owner” specified above or registered assigns (herein
referred to as the “Holder”), on the “Maturity Date” specified above, the “Principal Amount” specified
above and to pay interest (calculated on the basis of a 360-day year of twelve 30-day months) on the
unpaid portion thereof from the “Original Issue Date” specified above, or from the most recent
“Interest Payment Date” (as such term is hereinafter defined) to which interest has been paid or duly
provided for, until paid or the payment thereof is duly provided for at maturity, semiannually on each
January 1 and July 1, commencing [January 1, 2026] (each an “Interest Payment Date”), at the per
annum “Interest Rate” specified above.
As provided in the Issuer’s Resolution No. 15-25 (Floreo at Teravalis), adopted on July 1, 2025
(the “Bond Resolution”), the interest, principal and Redemption Price (as such term and all other terms
used herein and not defined are defined in the Bond Resolution) payable on the Bonds shall be paid to
Cede & Co. or its registered assigns in same-day funds no later than the time established by DTC on
the date due (or in accordance with then existing arrangements between the Issuer and DTC). Payments
will be made to the Registered Owner on the registration books maintained by the Registrar at the close
6565653.5
A-2
of business of the Registrar on the fifteenth day of the calendar month (other than a Saturday, a Sunday,
or a legal holiday or equivalent (other than a moratorium) for banking institutions generally (a
“business day”) next preceding the applicable Interest Payment Date; if such day is not a business day,
then the previous business day.
Neither the full faith and credit nor the general taxing power of the Issuer, the City of Buckeye,
Arizona, Maricopa County, Arizona or the State of Arizona or any political subdivision thereof is
pledged to the payment of the Bonds.
Unless the Certificate of Authentication hereon has been executed by the Registrar, by manual
signature, this Bond shall not be entitled to any benefit under the Bond Resolution or be valid or
obligatory for any purpose.
This Bond is one of a duly authorized issue of assessment revenue bonds of the Issuer having
the designation specified in its title (herein referred to as the “Bonds”), issued in one series, with the
limitations described herein, pursuant the Bond Resolution to which Bond Resolution reference is
hereby made for a description of the amounts thereby pledged and assigned, the nature and extent of
the lien and security, the respective rights thereunder of the Holder of the Bonds and the Issuer, and
the terms upon which the Bonds are, and are to be, authenticated and delivered and by this reference
to the terms of which each Holder of this Bond hereby consents. All Bonds issued under the Bond
Resolution are equally and ratably secured by the amounts thereby pledged and assigned. Pursuant to
the Bond Resolution, the District Board of the Issuer authorized the issuance and sale of not to exceed
$10,970,000 aggregate principal amount of Bonds for the purpose of financing the costs of acquiring
certain public infrastructure, including particularly the acquisition by the Issuer of the improvements
and public infrastructure purposes (the “Improvements”) described in Resolution No. 09-25 (Floreo at
Teravalis), which was adopted by the District Board of the Issuer on June 17, 2025.
The Bonds are limited obligations of the Issuer payable only out of the special fund to be
collected from a special assessment (the “Assessment”) levied only against the lots or parcels of land
fronting on or benefited by the Improvements (the “Assessed Property”) and from amounts held by the
Issuer in the Reserve Fund (the “Debt Service Reserve Fund”). The Assessed Property represents
approximately 1,097 residential lots over approximately 164 acres of land within the Floreo at
Teravalis Community Facilities District (City of Buckeye, Arizona). Said special fund is set apart in
accordance with the laws of the state and pursuant to the Bond Resolution for the payment of the Bonds
and can be used for no other purpose.
The amount required to be held in the Debt Service Reserve Fund (the “Reserve Fund
Requirement”) may be reduced from time to time if Maximum Annual Debt Service on the Bonds is
reduced. Any amount held in the Debt Service Reserve Fund in excess of the Reserve Fund
Requirement may be transferred to the Bond Fund and used to make payment of principal and interest
on the Bonds either at stated maturity or prior redemption.
Investment earnings on the Debt Service Reserve Fund, to the extent not needed to return the
Debt Service Reserve Fund to the Reserve Fund Requirement, to pay debt service on the Bonds, or to
pay rebate to the United States, will be deposited into the Bond Fund.
The Bonds are issuable as fully registered bonds only in the denominations of $5,000 or any
integral multiple of $1,000 in excess thereof. However, in order to accommodate a special redemption
of the Bonds, Bonds may be in a denomination of less than $5,000 in integral multiples of $1,000.
6565653.5
A-3
Notwithstanding any provision hereof or of the Bond Resolution, the obligation of the Issuer
to make money available to pay this Bond may be defeased by the deposit of money and/or certain
direct or indirect obligations of the United States of America (such obligations to be approved by the
Issuer’s bond counsel) sufficient for such purposes, as described in the Bond Resolution.
The Bonds are subject to special optional redemption prior to maturity at the option of the
Issuer in whole or in part, on any Interest Payment Date, upon not more than 60 nor less than 30 days’
prior notice, upon payment of the applicable Redemption Price which will consist of the principal
amount of the Bonds so redeemed, plus interest, if any, on the Bonds so redeemed from the most recent
Interest Payment Date to the applicable redemption date without premium: (i) if and to the extent on
or after the completion of the Project, upon direction given to the Registrar by the Issuer, amounts
transferred from the Acquisition Fund for such purpose; (ii) from the prepayment of any assessment
by the owner of any assessed real property; or (iii) from the proceeds of any sale of any delinquent
assessed real property to the extent such foreclosure sale proceeds are not used to replenish the Debt
Service Reserve Fund to an amount equal to the Reserve Fund Requirement.
The Bonds maturing on or after July 1, 20__, will also be redeemable, on or after July 1, 20__,
at the option of the Issuer, in whole on any date or, from time to time, in part on any Interest Payment
Date, upon not more than 60 nor less than 30 days’ prior notice, upon payment of the applicable
Redemption Price, which will consist of the principal amount of the Bonds so redeemed plus interest,
if any, on the Bonds so redeemed from the most recent Interest Payment Date to the redemption date,
without premium.
The Bonds maturing in the following years will be redeemed on the following redemption dates
and in the following (sinking fund) amounts upon not more than 60 nor less than 30 days’ prior notice,
upon payment of the applicable Redemption Price, which will consist of the principal amount of the
Bonds so redeemed plus interest, if any, on the Bonds so redeemed from the most recent Interest
Payment Date to the applicable redemption date without premium:
Redemption Date
(July 1)
Principal
Amount
20
20__
$ ,000
20__
,000
20__
,000
20__
,000
20__
,000
20
20__
$ ,000
20__
,000
20__
,000
20__
,000
20__
,000
6565653.5
A-4
Whenever Bonds are redeemed (other than pursuant to mandatory redemption) or delivered to
the Bond Registrar and Paying Agent for cancellation, the principal amount of the Bonds of such
maturity so retired shall satisfy and be credited against the mandatory redemption requirements of such
maturity on a pro-rata basis, to the extent practicable; provided, however that each remaining
mandatory payment shall be in an amount which is an authorized denomination.
Notice of redemption shall be mailed not more than 60 nor less than 30 days prior to the date
fixed for redemption to each Bondholder of Bonds to be redeemed, at the address appearing in the
Register.
Bonds may be redeemed in an amount which is included in a Bond in the denomination in
excess of $5,000, but divisible by, $1,000. However, in order to accommodate a special redemption
of Bonds, Bonds may be in a denomination of less than $5,000 in integral multiples of $1,000. Bonds
(or portions thereof) for whose redemption and payment provision is made in accordance with the
Bond Resolution shall thereupon cease to be entitled to the benefits of the Bond Resolution and shall
cease to bear interest from and after the date fixed for redemption.
The Bonds shall initially be issued as a single fully-registered bond for each Maturity and so
long as the ownership of the Bonds is maintained in book-entry form by DTC or a nominee thereof,
this Bond may be transferred in whole but not in part only to DTC or a nominee thereof or to a successor
to DTC or its nominee.
The Issuer will not have any responsibility or obligation to any direct participant, indirect
participant or any beneficial owner or any other person not shown on the registration books of the
Registrar as being a Bondholder with respect to: (i) the Bonds; (ii) the accuracy of any records
maintained by DTC or any direct participant or indirect participant; (iii) the timely or ultimate payment
by DTC or any direct participant or indirect participant of any amount due to any beneficial owner in
respect of the principal or Redemption Price of or interest on the Bonds; (iv) the delivery by any direct
participant or indirect participant of any notice to any beneficial owner which is required or permitted
under the terms of the Bond Resolution to be given to the Bondholders; (v) the selection of the
beneficial owner to receive payment in the event of any partial redemption of the Bonds; or (vi) any
consent given or other action taken by DTC as the Bondholder.
If ownership of this Bond is not maintained in book-entry form, as provided in the Bond
Resolution and subject to certain limitations therein set forth, this Bond is transferable on the Register
of the Issuer, upon surrender of this Bond for transfer to the Paying Agent at the place of payment duly
endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Issuer and
the Paying Agent duly executed by, the registered Bondholder hereof or such Bondholder’s attorney
duly authorized in writing, and thereupon one or more new fully registered Bonds of authorized
denominations and for the same aggregate principal amount shall be issued to the designated transferee
or transferees.
If ownership of this Bond is not maintained in book-entry form, as provided in the Bond
Resolution and subject to certain limitations therein set forth, Bonds are exchangeable for a like
aggregate principal amount of Bonds in authorized denominations, as requested by the Bondholder,
upon surrender of the Bonds to be exchanged to the Paying Agent at the place of payment. The Paying
Agent may require payment of a sum sufficient to cover any tax or other charges payable in connection
therewith.
6565653.5
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The Issuer, the Registrar, the Paying Agent, and any agent of any of them may treat the Person
in whose name this Bond is registered as the owner hereof for the purpose of receiving payment as
herein provided and for all other purposes, whether or not this Bond be overdue, and none of the Issuer,
the Registrar, the Paying Agent, and any such agent shall be affected by notice to the contrary.
It is hereby certified, covenanted, and represented that all acts, conditions, and things required
to be performed, exist, and be done precedent to or in the issuance of this Bond have been performed,
exist, and have been done, in regular and due time, form, and manner, as required by law, and that the
Assessments from which said Bonds are to be paid are first liens on the property assessed, subject only
to the lien for general taxes and prior special assessments. In case any provision in this Bond or any
application thereof shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability
of the remaining provisions and applications shall not in any way be affected or impaired thereby. This
Bond shall be construed in accordance with and governed by the laws of the State of Arizona.
IN WITNESS WHEREOF, the Issuer has caused this Bond to be duly executed.
FLOREO AT TERAVALIS
COMMUNITY FACILITIES DISTRICT
(CITY OF BUCKEYE, ARIZONA)
By
District Chair
ATTEST:
District Clerk
Dated:____________________, 2025
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CERTIFICATE OF AUTHENTICATION
This is one of the Bonds referred to in the within-mentioned Bond Resolution.
U.S. BANK TRUST COMPANY, NATIONAL
ASSOCIATION, as Registrar
By______________________________________
Authorized Representative
DATE:___________________, 2025
- - - - - -- - - - -- - - - - - - -- - - - -- -- - - - - -- - - - -- -- - - - - -- - - - -- -- - - - - -- - - - -- -- - - - - -- - - - --
The following abbreviations, when used in the inscription on the face of the within bond, shall
be construed as though they were written out in full according to applicable laws or regulations:
TEN COM -- as tenants in common
UNIF GIFT/TRANS MIN ACT _________________________
TEN ENT -- as tenants by the entireties
(Cust.)
JT TEN -- as joint tenants with right of
Custodian for ________________________________ (Minor)
survivorship and not as tenants in common
Under Uniform Gifts/Transfers to Minors Act of _____________
(State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns, and transfers unto (Print or
typewrite name, address, and zip code of transferee:)
______________________________________________________________________________
______________________________________________________________________________
(Print or typewrite Social Security or other identifying number of transferee: ____________) the within
Bond and all rights thereunder, and hereby irrevocably constitutes and appoints (Print or typewrite
name of attorney) _____________, attorney, to transfer the within Bond on the books kept for
registration thereof, with full power of substitution in the premises.
DATED: _____________________
_________________________________________
Signature guarantee should be made by a
NOTICE: The signature(s) on this assignment must
guarantor institution participating in the
correspond with the name(s) of the registered owner(s)
Securities Transfer Agents Medallion Program
appearing on the face of the within Bond in every
or in such other guarantee program acceptable
particular
to the Registrar
6565653.5
EXHIBIT B
Continuing Disclosure Compliance Procedures Regarding the Securities and Exchange
Commission’s Rule 15c2-12 for the Floreo at Teravalis Community Facilities District (City
of Buckeye, Arizona)
(consisting of 7 pages)
6565653.5
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EXHIBIT B
CONTINUING DISCLOSURE COMPLIANCE PROCEDURES REGARDING THE SECURITIES
AND EXCHANGE COMMISSION’S RULE 15c2-12
FOR THE FLOREO AT TERAVALIS COMMUNITY FACILITIES DISTRICT
(CITY OF BUCKEYE, ARIZONA)
Date of Implementation: July 1, 2025.
In connection with its issuance of bonds or other obligations, the Floreo at Teravalis
Community Facilities District (City of Buckeye, Arizona) (the “District”) has adopted and/or will
adopt a Continuing Disclosure Certificate in connection with each series of publicly sold bonds or
obligations (each a “Certificate” and collectively, the “Certificates”). The Certificates require the
District to file annually audited financial statements and certain financial and operating information
and operating data (the “Annual Reports”), as well as to report certain financial events. The
procedures described below (the “Procedures”) are intended to help the District maintain
compliance with the Certificates. The District may have other reporting obligations in connection
with various loans and privately sold bonds or obligations; these Procedures are not intended to
apply to requirements related to transactions for which no Certificate was adopted.
1. Responsible Officers and Employees
The implementation and consistent execution of these procedures are extremely
important. One employee of the District should be given primary responsibility for compliance with
these Procedures (the “Disclosure Coordinator”), and at least two employees (who may include
the Disclosure Coordinator, referred to herein collectively as the “Disclosure Officials”) should be
familiar with and trained to implement these Procedures at all times. When Disclosure Officials
end their employment with the District, new Disclosure Officials should be named in their place.
Typically, this responsibility will be assigned based on role or title, but the District may assign
responsibility to any appropriate employee. New Disclosure Officials should be briefed on the
Certificates, dates, reports, and reminder systems described in these Procedures.
As of the Date of Implementation, the Disclosure Officials are the District’s:
District Treasurer
(Disclosure Coordinator)
District Clerk
2. Active Certificates and Financial Obligations
The District is obligated to comply with the requirements of a Certificate from the time the
District adopts the Certificate until the earlier of (i) the date that the last of the bonds or obligations
listed in the Certificate are paid or (ii) the date that the bonds or obligations listed in the Certificate
are defeased or refunded. Certificates between these two dates are “Active Certificates”. As of
the Date of Implementation, the District has or expects to have the Active Certificates listed in
Schedule I.
6565653.5
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The Certificates entered into after February 26, 2019, require disclosure of facts relating
to certain financial obligations (see Section 4 below). For purposes of these Procedures,
“Financial Obligation” means, with the exception of bonds or obligations for which the District
provided a final official statement to the Municipal Securities Rulemaking Board (“MSRB”)
consistent with the United States Securities and Exchange Commission’s Rule 15c2-12 (the
“Rule”):
(i) a debt obligation;
(ii) a derivative instrument entered into in connection with, or pledged as security or a
source of payment for, an existing or planned debt obligation; or
(iii) a guarantee of (i) or (ii).1
“Active Financial Obligations” are those Financial Obligations which are enforceable
against the District and for which the District has not already made all required payments. A list
of Active Financial Obligations, in the form set forth in Schedule II, is on file with the District.
The Disclosure Coordinator should maintain an updated list of Active Certificates and
Active Financial Obligations, including the information listed in Schedules I and II, and review the
list periodically to ensure accuracy. When the District enters into a new Financial Obligation, the
Disclosure Coordinator will ensure timely reporting (see Section 4 below), as applicable.
3. Annual Reports
Compliance with the Certificates includes ensuring that all of the tables and information
required by Section 4 of the Certificates are included in the Annual Reports. In each case, the
information required by the Certificates should be filed no later than the reporting date listed within
each Certificate (the “Annual Reporting Date”) of each fiscal year while the District’s bonds or
obligations require such Annual Reports.
To ensure that the Annual Reports are submitted in a timely manner, the earliest Annual
Reporting Date should be put into a reminder system, such as a docket, diary or tickler, which is
maintained by a minimum of two people (typically, the Disclosure Officials). When those listed on
the reminder system leave the District’s employment, new names must be added.
The MSRB allows the District to schedule automated e-mail reminders for these Annual
Reports through its Electronic Municipal Market Access system (“EMMA”). The District can add
up to three e-mail recipients, so the Disclosure Officials and/or other staff may be included on the
reminders.
Note: Some issuers of bonds or obligations engage an auditor or a dissemination agent
to make the EMMA filings. If the District has such an agreement, the District is still responsible if
the auditor or dissemination agent fails to timely file the required Annual Report. Thus, even if
the auditor or dissemination agent agrees to make the required filings, the District must comply
with the Annual Reporting Date and inquire of the District’s auditor or dissemination agent to
determine if the filing deadline will be, and ultimately is, met. If there is a substantial risk that the
deadline will not be met, it is the District’s responsibility – not that of the District’s auditor or
dissemination agent – to file a notice with EMMA indicating that the deadline will not be met and
1 See Securities and Exchange Commission Release No. 34-83885, effective October 30, 2018, for additional
information.
6565653.5
B-3
an estimate as to when the Annual Report will be filed. If audited financial statements are not
available by the Annual Reporting Date, unaudited financial statements must be filed by the
Annual Reporting Date until audited financial statements are available. Such unaudited financial
statements may be filed separately or together with the other financial and operating data.
4. Listed Events
The District is required to file notices of “Listed Events” with EMMA within ten business
days of such events or occurrences. Please note that Listed Events enumerated in the District’s
existing and future Certificates may differ. The District should provide notice of the Listed Events
from all Certificates. Typically, the most recent Certificate will provide the broadest requirements
and can serve as a reference. Required Listed Events are defined by the United States Securities
and Exchange Commission’s Rule 15c2-12 (the “Rule”), which may be revised or amended in the
future. As a result, future Certificates may require the reporting of a different set of Listed Events.
The District should check with its bond counsel at the time future bonds or obligations are issued
to determine if the Listed Events have been changed and if the later Certificate differs from the
District’s current Certificates. The Listed Events that require notice are listed in Section 5 of the
Certificates. Currently, the Rule requires reporting of the following Listed Events:
1.
Principal and interest payment delinquencies;
2.
Non-payment related defaults, if material;
3.
Unscheduled draws on debt service reserves reflecting financial difficulties;
4.
Unscheduled draws on credit enhancements reflecting financial difficulties;
5.
Substitution of credit or liquidity providers, or their failure to perform;
6.
Adverse tax opinions, the issuance by the Internal Revenue Service (the
“IRS”) 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 securities, or other material events
affecting the tax status of the securities;
7.
Modifications to rights of securities holders, if material;
8.
Securities calls, if material, and tender offers;
9.
Defeasances;
10.
Release, substitution, or sale of property securing repayment of the
securities, if material;
11.
Rating changes;
12.
Bankruptcy, insolvency, receivership or similar event of the District2;
2 For the purposes of the event identified in Section 4(12), the event 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 U.S.
Bankruptcy Code or in any other proceeding under state or federal law in which a court of 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
6565653.5
B-4
13.
The consummation of a merger, consolidation, or acquisition involving the
District or the sale of all or substantially all of the assets of the District, other
than in the ordinary course of business, the entry into a definitive
agreement to undertake such an action nor the termination of a definitive
agreement relating to any such actions, other than pursuant to its terms, if
material;
14.
Appointment of a successor or additional trustee or the change of name of
a trustee, if material;
15.
The incurrence of a Financial Obligation of the District, if material, or
agreement to covenants, events of default, remedies, priority rights, or
other similar terms of a Financial Obligation of the District, any of which
affect securities holders, if material; and
16.
A default, event of acceleration, termination event, modification of terms,
or other similar events under the terms of a Financial Obligation of the
District, any of which reflect financial difficulties.
“Materiality” will be determined in accordance with the applicable federal securities laws.
Whenever any officer or employee of the District becomes aware of any event that may
qualify as a Listed Event, the officer or employee should immediately notify the Disclosure
Officials in order to facilitate prompt filing of a notice. If the Disclosure Officials are uncertain as
to whether an event qualifies as a Listed Event, including whether a transaction qualifies as a
Financial Obligation, or whether an event or Financial Obligation is material, they should contact
bond counsel.
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.
6565653.5
B-5
SCHEDULE I
The District has no Active Certificates as of the Date of Implementation.
The District expects to adopt the following Certificates:
Series of Bonds or other Obligations
Certificate Date*
Annual
Reporting Date
Final Maturity
Date*
Special Assessment District No. 1
Special Assessment Revenue Bonds,
Series 2025
[August __, 2025]
February 1
[July 1, 2045]
*Anticipated
6565653.5
B-6
SCHEDULE II
*If variable, include method of computation.
Name of Obligation:
Dated:
Original Principal Amount:
Interest Rate:*
Final Payment Date:
Other Material Terms:
Amortization Schedule
Maturity
Principal
Interest
*If variable, include method of computation.
Name of Obligation:
Dated:
Original Principal Amount:
Interest Rate:*
Final Payment Date:
Other Material Terms:
Amortization Schedule
Maturity
Principal
Interest
6565653.5
B-7
APPENDIX
The following materials are intended to serve as a quick reference for Disclosure Officials.
The EMMA website is subject to modification by the MSRB. The District’s Disclosure Officials
should update this information as necessary.
The District’s Base CUSIP–6 number: ___________
How to schedule alerts for Annual Reports:
To schedule the alerts, access EMMA at www.emma.msrb.org and click on the EMMA Dataport
tab. Click on the “Login” button and enter your login information (User ID and password). From
the Continuing Disclosure tab of the EMMA Dataport Submission Portal, click on “Schedule and
manage e-mail reminders for recurring financial disclosures.” Click the “Create Reminder” link to
access the scheduling form.
How to file notices of “Listed Events” with EMMA:
First, please save the Listed Events notice on your computer in a PDF, word-searchable
format. You will also need the information contained in the Listed Events notice, so please print
out a copy of the Listed Events notice.
1.
Login to EMMA at http://dataport.emma.msrb.org/
2.
Click CREATE Continuing Disclosure Submission
3.
Check Event Filing, click Next
4.
Check “Type of Event” – In the description box type: “[type of notice]”
5.
Check “I don’t know my CUSIP–9s” and then use the District’s base CUSIP
number to find the affected certificates of participation, bonds or obligations
6.
Check “all issues for issuer”, click Next
7.
Click upload
8.
Update contact information, if necessary
9.
Upload the Listed Events notice
10.
Click preview
11.
Publish the documents to EMMA
12.
Print receipt and save in your certificate of participation or bond documents for the
life of the certificates, bonds or obligations
Please note there is only a limited save option on EMMA. Therefore, the District will not
be able to start entering the information, exit and continue later.
6565653.5
EXHIBIT C
Issuance and Post-Issuance Compliance Procedures Relating to Tax-Exempt Bonds
Other Tax-Exempt Financings for the Floreo at Teravalis Community Facilities District
(City of Buckeye, Arizona)
(consisting of 3 pages)
6565653.5
C-1
EXHIBIT C
ISSUANCE AND POST-ISSUANCE COMPLIANCE PROCEDURES
RELATING TO TAX-EXEMPT BONDS AND OTHER TAX-EXEMPT FINANCINGS FOR THE
FLOREO AT TERAVALIS COMMUNITY FACILITIES DISTRICT
(CITY OF BUCKEYE, ARIZONA)
Date of Implementation: July 1, 2025.
I.
INTRODUCTION
Many conditions, restrictions and requirements must be complied with to permit and
preserve the tax-exempt treatment of bonds and other financings by the Floreo at Teravalis
Community Facilities District (City of Buckeye, Arizona) (the “District”). Prior to issuance, the
District and its bond counsel will review the facts and the reasonable expectations to determine if
the issue will comply with these conditions, restrictions and requirements at the time of issuance.
There are certain actions the District must perform after issuance to preserve the favorable tax
treatment and certain actions of the District after issuance can adversely affect the tax treatment.
In addition, the District must maintain proper records to demonstrate compliance. Because tax
benefits may be critical to the investors’ decision to purchase the bonds or other obligations, the
District covenants to the bond purchasers to comply with all of the conditions, restrictions and
requirements throughout the life of the bonds.
To ensure compliance, the District must identify a single person with overall compliance
responsibility. The District Treasurer, or his or her designee, will be the responsible person and
is referred to in these procedures as the Bond Compliance Official. Anyone with any questions
about the bonds, the proceeds of the bonds, the facilities financed with the bonds or compliance
with the conditions, restrictions and requirements should discuss them with the Bond Compliance
Official who shall, as necessary, discuss them with bond counsel. The Bond Compliance Official
shall meet with bond counsel to discuss these requirements and from time to time any changes
in these requirements. In the event the District fails to comply with these procedures, the Bond
Compliance Official shall meet with bond counsel as soon as practicable after the discovery of
the failure to comply in order to discuss the steps required to correct the noncompliance.
1.
INVESTMENT OF PROCEEDS UNTIL EXPENDED.
Detailed records of investments and earnings will be made and kept by the District
with respect to all bond proceeds.
Generally, proceeds of bonds cannot be invested at a yield higher than the bond
yield unless during certain specific temporary periods. Therefore, prior to closing, the Bond
Compliance Official will determine with bond counsel which funds do or do not qualify for a
temporary period. Qualifying information will be set out in a tax certificate. No proceeds will be
invested at a yield higher than the bond yield unless they qualify. If the actual facts regarding the
use of proceeds change from what was reasonably expected at closing, the Bond Compliance
Official will discuss those changes with bond counsel to see if the temporary periods are changed.
Bond proceeds include the amount received from the sale of the bonds, amounts
held in a payment or reserve fund for the bonds and investment earnings on those amounts.
6565653.5
C-2
The proceeds will not be invested in any investment where a yield cannot be
determined.
Any investment in a guaranteed investment contract or similar investment
agreement will be made only in compliance with the bidding requirements as reviewed by bond
counsel.
Bond proceeds from each issue will be invested so that they can be tracked
separately from any other funds of the District. The District will work with the registrar, trustee or
other applicable person or entity to be sure that invested earnings are properly allocated between
bond proceeds and other funds.
2.
USE OF PROCEEDS.
Detailed records will be made and kept by the District with regard to the use of
bond proceeds and shall be kept on a series by series basis. For each expenditure, the amount,
date of and purpose will be recorded. If the project is also funded with non-bond proceeds, the
records will reflect an allocation of expenditures between bond proceeds and other funds. No
proceeds will be used to reimburse an expenditure made prior to the issue date of the bonds
unless the reimbursement requirement, including the prior declaration of intent to reimburse, has
been fully complied with and evidence of such compliance is maintained. The District’s Board by
taking action, or the District Treasurer or his or her designee, is authorized to complete the
declaration of intent to reimburse.
Under federal tax law, the District is expected to exercise diligence (A) to expend
the proceeds, (B) to enter into within six months of the issue date a binding contract to expend at
least 10% of the proceeds and (C) to have expended most of the proceeds within three years.
After the third anniversary of the issue, any remaining proceeds in the construction account must
be yield restricted.
The Bond Compliance Official shall periodically review the progress of the projects
and the expenditure of proceeds to ensure timely expenditure of proceeds.
3.
USE OF BOND FINANCED FACILITIES.
Detailed records of the use of proceeds will identify those facilities that are financed
in whole or in part with bond proceeds and must reflect the allocation of bond proceeds and other
funds used. Any sale or lease to, or other agreement for use by, a private party in a trade or
business can adversely affect the tax status of the bonds. The District will not sell or lease any
bond financed property or enter into any agreement with non-governmental entities for use or
management of any bond financed property without a thorough review by the Bond Compliance
Official and bond counsel. Although not a comprehensive list, the Bond Compliance Official will
review the following types of transactions with bond counsel prior to entering into any agreement
with non-governmental entities or persons: (a) the sale or lease of any bond financed property,
(b) any management contracts with a food service provider, (c) any research agreements and (d)
public-private partnerships. The Bond Compliance Official shall periodically review the use of all
bond financed facilities to ensure compliance with the private use restrictions. In the event the
District takes action that causes the bonds to meet the private business tests or private loan
financing test, the Bond Compliance Official shall meet with bond counsel as soon as practicable
after the issue is discovered to discuss the steps required to correct the noncompliance, including,
6565653.5
C-3
if necessary, redeeming or defeasing all of the bonds that meet the private business tests or
private loan financing test.
4.
ARBITRAGE REBATE.
Any time that bond proceeds are permitted to be invested at a yield higher than
the bond yield, the amount earned over the bond yield is arbitrage. With certain exceptions, the
District is obligated to pay over (rebate) to the United States any arbitrage earned. The District
will keep complete and accurate records of all investments of bond proceeds and all information
supporting any applicable exceptions to the rebate requirement and will retain or ensure that the
registrar or trustee has retained a professional rebate consultant to review the records and
prepare a report so that the District or the registrar or trustee can make any necessary rebate
payments. Unless exempt, the District must, at a minimum, make payments at every fifth
anniversary of the issue and upon final payment. The Bond Compliance Official will review any
exemption prior to each fifth anniversary and upon final payment to determine if any facts have
changed which might eliminate the exemption.
5.
RECORD RETENTION.
All records concerning the bond issue, including
a)
the transcript of the original proceedings,
b)
investment of proceeds,
c)
use and allocation of proceeds, including any declaration of intent to
reimburse,
d)
non-governmental use of bond financed property,
e)
payment of principal and interest on the bonds,
f)
the interest rate or rates on the bonds from time to time, if variable,
g)
compliance with reimbursement requirements,
h)
refunding of all or part of the bonds, and
i)
payment of arbitrage rebate or information supporting any exemption to
rebate, and
shall be kept for the life of the bonds plus three years (and in compliance with any State of Arizona
records retention policies) and, if the bonds are refunded, for the life of all of the refunding bonds
plus three years (and in compliance with any State of Arizona records retention policies).
6.
EMMA REMINDER.
As an issuer of bonds, the District is also required to provide ongoing disclosures
in the form of annual financing information and certain listed events, currently filed on the
Municipal Securities Rulemaking Board’s Electronic Municipal Market Access (“EMMA”) system.