Ordinance 2024-07 STATE OF ILLINOIS )
SS
COUNTY OF KENDALL )
FILING CERTIFICATE
I,the undersigned, do hereby certify that I am the duly elected, qualified and acting County
Clerk of The County of Kendall, Illinois, and as such officer I do further certify that on the 20th
day of March, 2024, there was filed in my office that certain United City of Yorkville, Illinois
Ordinance No. 2024-07 entitled:
AN ORDINANCE PROVIDING FOR ISSUANCE OF UNITED
CITY OF YORKVILLE, KENDALL COUNTY, ILLINOIS SPECIAL
SERVICE AREA NUMBER 2004-107 SPECIAL TAX REFUNDING
BONDS, SERIES 2024 (RAINTREE VILLAGE II PROJECT), AND
AUTHORIZING THE EXECUTION OF A BOND ORDER,
duly passed and approved by the Council of the United City of Yorkville,Kendall County,Illinois,
on the 12th day of March, 2024, and that said Ordinance has been placed on file in and appears in
the records of my office.
IN WITNESS WHEREOF I hereunto affix my official signature and the seal of the County
of Kendall, Illinois, on this 20th day of March, 2024. 1
ALI
County Clerk of
The County of Kendall, Illinois
[SEAL] STATE OF ILLINOIS
COUNTY OF KENDALL
- FILED -
MAR 2 0 2024
COUNTY CLERK
/O "��j�/�/ di KENDALL COUNTY
UNITED CITY OF YORKVILLE
KENDALL COUNTY
STATE OF ILLINOIS
ORDINANCE NUMBER 2024-07
AN ORDINANCE PROVIDING FOR ISSUANCE OF
UNITED CITY OF YORKVILLE, KENDALL COUNTY, ILLINOIS
SPECIAL SERVICE AREA NUMBER 2004-107
SPECIAL TAX REFUNDING BONDS, SERIES 2024
(RAINTREE VILLAGE II PROJECT), AND AUTHORIZING THE EXECUTION OF A
BOND ORDER
ADOPTED BY THE
CITY COUNCIL
OF THE
UNITED CITY OF YORKVILLE
SLATE OF ILLINOIS
KENDALL COUNTY BOUNTY OF KENDALL
FILEp
STATE OF ILLINOIS MAR 2 0 2024
The 12th day of March, 2024 4:11/4. COUNTY CLERK
KENDALL COUNTY
Published in pamphlet form by authority of the City Council of the United City of Yorkville,
Kendall County, Illinois this 12th day of March, 2024.
51642736.E
ORDINANCE NO. 2024-07
AN ORDINANCE PROVIDING FOR ISSUANCE OF
UNITED CITY OF YORKVILLE, KENDALL COUNTY, ILLINOIS
SPECIAL SERVICE AREA NUMBER 2004-107
SPECIAL TAX REFUNDING BONDS, SERIES 2024
(RAINTREE VILLAGE II PROJECT), AND AUTHORIZING
THE EXECUTION OF A BOND ORDER
BE IT ORDAINED BY THE CITY COUNCIL OF THE UNITED CITY OF
YORKVILLE, KENDALL COUNTY, ILLINOIS, AS FOLLOWS:
Section 1. Findings and Declarations. It is found and declared by the City Council of
the United City of Yorkville, Kendall County, Illinois (the "City") as follows:
a. The City has previously established Special Service Area Number 2004-
107 described more fully in Exhibit A to this Ordinance (the "Special Service Area")
pursuant to Ordinance Number 2005-90 adopted on November 22,2005 (the"Establishing
Ordinance"), the provisions of the Special Service Area Tax Law, 35 ILCS 200/27-5 et
seq.,as amended(the"Special Service Area Act")and the provisions of Section 7 of Article
VII of the 1970 Constitution of the State of Illinois, and has otherwise complied with all
other conditions precedent required by the Special Service Area Act.
b. It was deemed necessary and in the best interests of the City to provide
special services benefiting the Special Service Area consisting of the acquisition,
construction and installation of public improvements including, but not limited to,
engineering, soil testing and appurtenant work, mass grading and demolition, storm water
management facilities, storm drainage systems and storm sewers, site clearing and tree
removal, public water facilities, sanitary sewer facilities, erosion control measures, roads,
streets, curbs, gutters, street lighting, traffic controls, sidewalks, equestrian paths and
related street improvements, and equipment and materials necessary for the maintenance
thereof, landscaping, wetland mitigation and tree installation, costs for land and easement
acquisitions relating to any of the foregoing improvements,required tap-on and related fees
for water or sanitary sewer services and other eligible costs to serve the Special Service
Area(the"Special Services").
c. The City has previously issued$9,400,000 in aggregate principal amount of
its Special Service Area Number 2004-107, Special Tax Bonds, Series 2005 (Raintree
Village II Project) (the "Prior Bonds"), of which $4,817,000 in principal amount shall
remain outstanding following the scheduled March 1, 2024 principal payment, to pay and
provide funds for a portion of the costs of the Special Services.
d. In order to achieve debt service savings, it is in the best interests of the City
to refund the Prior Bonds.
51642736.6
e. The City does not have sufficient funds on hand or available from other
sources with which to pay the costs associated with the refunding of the Prior Bonds.
f. It is in the best interests of the City to issue not to exceed $6,000,000
principal amount of its Special Service Area Number 2004-107 Special Tax Refunding
Bonds, Series 2024 (Raintree Village II Project) (the "Bonds"), as provided in this
Ordinance and the Bond Order(as defined in Section 2 hereof), to pay or provide funds to
(i) refund the Prior Bonds, (ii) fund a debt service reserve fund, (iii) pay the insurance
premiums for the Bonds, if insured and (iv) pay the costs associated with the issuance of
the Bonds.
g. The City expects that aggregate payments of principal of and interest on the
Bonds will be less than aggregate payments of principal of and interest on the outstanding
Prior Bonds.
h. The notice and hearing requirements set forth in Section 27-45 of the
Special Service Area Act do not apply to the Bonds because the interest rate on the Bonds
and the maximum period of time over which the Bonds will be retired will not be greater
than that set forth in the notices for the Prior Bonds. In addition, the debt service on the
Bonds will not exceed the debt service to be paid over the remaining duration of the Prior
Bonds.
i. After due publication of notice as required by the Special Service Area Act,
including, without limitation, notice of the issuance of the Prior Bonds in an aggregate
principal amount not to exceed$10,000,000, a public hearing to consider the establishment
of the Special Service Area, the issuance of the Prior Bonds for the purpose of paying the
costs of the Special Services and the manner in which the Prior Bonds were proposed to be
retired and the proposed tax levy, was held in accordance with law. No objection petition
was filed with respect to the establishment of the Special Service Area or the issuance of
the Prior Bonds within the period of time allowed pursuant to the Special Service Area Act.
Section 2. Issuance of Bonds. The City shall borrow the sum of not to exceed
$6,000,000 by issuing the Bonds as provided in this Ordinance. The Bonds shall be designated
"United City of Yorkville, Kendall County, Illinois Special Service Area Number 2004-107
Special Tax Refunding Bonds, Series 2024 (Raintree Village II Project)," and shall be issued for
the purpose of refunding the Prior Bonds. The Bonds shall be issued pursuant to the powers of the
City pursuant to Section 7 of Article VII of the 1970 Constitution of the State of Illinois;the Special
Service Area Act; and the Local Government Debt Reform Act, 30 ILCS 350/1 et seq. (the"Debt
Act").
The Mayor is hereby authorized and directed to establish the final terms of the Bonds as
set forth in the City's Bond Order to be executed by the Mayor and attested by the City Clerk(the
"Bond Order"), in form and substance acceptable to the Village Attorney and Saul Ewing LLP,
Bond Counsel, but only within the parameters or on such terms as set forth in Section 4 of this
Ordinance and in furtherance of such duty is hereby authorized and directed to execute the Bond
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51642736.6
Order on behalf of the City. The Bonds shall be issued in such principal amounts, mature on such
dates and bear interest at such rates and be subject to redemption as set forth in the Bond Order.
Section 3. Approval of Documents. There have been submitted to the City Council
forms of the following documents relating to the issuance of the Bonds:
a. a form of Trust Indenture (the "Indenture") between the City and
Amalgamated Bank of Chicago, as Trustee, to be dated as of April 1, 2024, which form of
Indenture is attached as Exhibit B to this Ordinance;
b. a form of Bond Purchase Agreement (the "Bond Purchase Agreement")
between the City and D.A. Davidson & Co., as Underwriter (the "Underwriter"), to be
dated as of the date the offer of the Underwriter to purchase the Bonds is accepted by the
City,which form of Bond Purchase Agreement is attached as Exhibit C to this Ordinance;
c. a form of the Preliminary Official Statement (the "Preliminary Official
Statement") to be used by the Underwriter in its initial offering of the Bonds, which form
of Preliminary Official Statement is attached as Exhibit D to this Ordinance;
d. a form of the Continuing Disclosure Agreement by and between the City
and Amalgamated Bank of Chicago, which form of Continuing Disclosure Agreement is
attached as Exhibit E to this Ordinance; and
e. a form of the Agreement for Administrative Services between DTA,
formerly known as David Taussig & Associates, Inc., and the City, which form of
Agreement for Administration Services is attached as Exhibit F to this Ordinance.
Such documents are approved as to form and substance and the Mayor and the City Clerk
of the City are authorized and directed to execute and deliver and/or authorize the use of such
documents on behalf of the City in the forms submitted with such additions, deletions and
completions of the same (including the establishment of the terms of the Bonds within the
parameters set forth in this Ordinance) as the Mayor and the City Clerk deem appropriate, the
Mayor's signature on such documents constituting his approval thereof and to be deemed
conclusive and binding approval hereunder; and when each such document is executed, attested,
sealed and delivered on behalf of the City, as provided herein, each such document will be binding
on the City; from and after the execution and delivery of each such document, the officers,
employees and agents of the City are hereby authorized, empowered and directed to do all such
acts and things and to execute all such additional documents as may be necessary to carry out,
comply with and perform the provisions of each such document as executed; and each such
document shall constitute, and hereby is made, a part of this Ordinance, and a copy of each such
document shall be placed in the official records of the City, and shall be available for public
inspection at the office of the City Clerk. Either the Mayor or City Clerk is authorized and directed,
subject to the terms of the Bond Purchase Agreement as executed, to execute the final Official
Statement in substantially the form of the Preliminary Official Statement presented hereto with
such changes, additions or deletions as they deem appropriate to reflect the final terms of the
Bonds, the Indenture and other matters. The Mayor and the City Clerk are authorized to obtain a
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51642736.6
Bond Insurance Policy insuring the payment of all or a portion of the principal of and interest on
the.Bonds when due (the "Bond Insurance Policy") from a bond insurer (a"Bond Insurer") if the
Mayor determines such Bond Insurance Policy to be beneficial in connection with the sale of the
Bonds. The Mayor and City Clerk are hereby authorized on behalf of the City, to make such
customary covenants and agreements with the Bond Insurer as are not inconsistent with the terms
of this Ordinance and as may be required by the Bond Insurer to issue its Bond Insurance Policy.
The Mayor and the City Clerk are further authorized to obtain an insurance policy, surety bond,
irrevocable letter of credit or similar instrument deposited in or credited to the reserve fund to be
created and established pursuant to the Indenture (the "Reserve Fund") in lieu of or in partial
substitution for moneys on deposit therein(in any event, a"Reserve Fund Insurance Policy")from
the Bond Insurer or any other entity issuing a Reserve Fund Insurance Policy with respect to the
Bonds (in either case, a"Surety Provider") if the Mayor determines such Reserve Fund Insurance
Policy to be beneficial in connection with the sale of the Bonds. The Mayor and City Clerk are
hereby authorized on behalf of the City, to make such customary covenants and agreements with
the Surety Provider (including, without limitation, any reimbursement agreement, guaranty
agreement or other credit facility agreement) as are not inconsistent with the terms of this
Ordinance and as may be required by the Surety Provider to issue its Reserve Fund Insurance
Policy.
Section 4. Bond Terms; Bond Order. The Bonds shall be issued as provided in the
Indenture and shall be issued in the principal amount of not to exceed $6,000,000, shall be dated,
shall mature, shall bear interest at the rates (not to exceed in any year five and one-half percent
(5.50%) per annum) and shall be subject to redemption at the times and prices as set forth in the
Indenture, and shall be sold to the Underwriter at a purchase price of not less than 98.75% of the
principal amount of the Bonds with an original issue discount or an original issue premium of not
to exceed 2% of the principal amount of the Bonds, all as set forth in the Bond Purchase
Agreement. The execution and delivery of the Bond Purchase Agreement by the Mayor and the
City Clerk shall evidence their approval of the terms of the Bonds set forth above. The Bond Order
shall specify the principal amount of the Bonds, the date of the Bonds, the interest rate on the
Bonds, the redemption provisions of the Bonds, the purchase price of the Bonds, the identity of
any Bond Insurer, if any, and the final form of any commitment to provide the Bond Insurance
Policy and the Reserve Fund Insurance Policy and may include such other terms as are deemed
necessary to provide for the sale of the Bonds which are not inconsistent with this Ordinance. The
Bond Order shall also provide for the abatement of any special taxes levied for the Prior Bonds to
be refunded. The execution and delivery of the Bond Order, the Bond Purchase Agreement and
the Indenture by the Mayor and the City Clerk shall evidence their approval of the terms of the
Bonds set forth above. This Ordinance, together with the Bond Order, shall constitute complete
authority for the City to issue the Bonds in accordance with applicable law.
Section 5. Execution and Delivery of Bonds. The Mayor and the City Clerk are
authorized and directed to execute and deliver the Bonds and, together with other Authorized
Officers(as defined in the Indenture),to take all necessary action with respect to the issuance, sale
and delivery of the Bonds, all in accordance with the terms and procedures specified in this
Ordinance and the Indenture. The Bonds shall be delivered to the Trustee who is directed to
authenticate the Bonds and deliver the Bonds to the Underwriter upon receipt of the purchase price
for the Bonds.
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51642736.6
The Bonds shall be in substantially the form set forth in the Indenture. Each Bond shall be
executed by the manual or facsimile signature of the Mayor and the manual or facsimile signature
of the City Clerk and shall have the corporate seal of the City affixed to it (or a facsimile of that
seal printed on it). The Mayor and the City Clerk(if they have not already done so) are authorized
and directed to file with the Illinois Secretary of State their manual signatures certified by them
pursuant to the Uniform Facsimile Signatures of Public Officials Act, as amended, which shall
authorize the use of their facsimile signatures to execute the Bonds. Each Bond so executed shall
be as effective as if manually executed. In case any officer of the City whose signature or a
facsimile of whose signature shall appear on the Bonds shall cease to be such officer before
authentication and delivery of any of the Bonds, that signature or facsimile signature shall
nevertheless be valid and sufficient for all purposes, the same as if the officer had remained in
office until delivery.
No Bond shall be valid for any purpose unless and until a certificate of authentication on
that Bond substantially in the form set forth in the bond form in the Indenture shall have been duly
executed by the Trustee. Execution of that certificate upon any Bond shall be conclusive evidence
that the Bond has been authenticated and delivered under this Ordinance.
Section 6. Bonds are Limited Obligations; Levy of Special Tax; Pledge. The Bonds
shall constitute limited obligations of the City,payable from the Special Taxes (as defined below)
to be levied on all taxable real property within the Special Service Area as provided below. The
Bonds shall not constitute the general obligations of the City •and neither the full faith and credit
•
nor the unlimited taxing power of the City shall be pledged as security for payment of the Bonds.
There are hereby levied Special Taxes upon all taxable real property within the Special
Service Area in accordance with the Special Tax Roll and Report (as defined below) sufficient to
pay and discharge the principal of and interest on the Bonds at maturity or mandatory sinking fund
redemption dates and to pay interest on the Bonds for each year at the interest rates to be set forth
in Section 2.4 of the Indenture and to pay for the Administrative Expenses (as defined in the
Indenture) of the City, if any, for each year and to fund and replenish the Reserve Fund and any
special reserve fund created and established pursuant to the Indenture (the "Special Reserve
Fund"),including specifically the following amounts for the following years(the"Special Taxes"):
An Amount Sufficient
Year of Levy To Produce the Sum of:
2024 $848,388
2025 $861,173
2026 $873,991
2027 $887,126
2028 $900,484
2029 $913,969
2030 $927,677
2031 $941,702
2032 $955,760
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51642736.6
2033 $970,168
Pursuant to the Special Tax Roll established by the Special Tax Roll and Report prepared
for the Special Service Area (the "Special Tax Roll and Report"), the Special Taxes shall be
computed,extended and collected in accordance with the Special Tax Roll and Report, and divided
among the taxable real property within the Special Service Area in accordance with the terms of
the Establishing Ordinance and the Special Tax Roll and Report. It shall be the duty of the City
and the City hereby covenants, annually on or before the last Tuesday of December for each of the
years 2024 through 2033 to calculate or cause the Consultant appointed pursuant to the Indenture
to calculate the Special Tax Requirement(as defined in the Special Tax Roll and Report);to amend
the Special Tax Roll pursuant to Section VIII of the Special Tax Roll and Report; to adopt an
ordinance approving the amount of the current calendar year's Special Tax Requirement and to
abate the Special Taxes levied pursuant to this Ordinance to the extent the taxes levied pursuant to
this Ordinance exceed the Special Tax Requirement as calculated by the Consultant pursuant to
the Establishing Ordinance and the Special Tax Roll and Report; and provide the County tax
collector of Kendall County the amended Special Tax Roll. On or before the last Tuesday of
January for each of the years 2025 through 2034, the City shall notify the Trustee of the amount
of the Special Tax Requirement and the amount of the Special Taxes to be abated. The City shall
take all actions which shall be necessary to provide for the levy, extension, collection and
application of the taxes levied by this Ordinance, including enforcement, of such taxes as provided
by law but only as set forth in Section 7(a)below.
The Special Taxes levied as provided above shall be deposited into the Bond and Interest
Fund created pursuant to the Indenture(the"Bond and Interest Fund") and are appropriated to and
are irrevocably pledged to and shall be used only for the purposes set forth in the Indenture.
Section 7. Special Covenants. The City covenants with the holders of the Bonds from
time to time outstanding that it (i) will take all actions which are necessary to be taken (and avoid
any actions which it is necessary to avoid being taken) so that interest on the Bonds will not be or
become included in gross income for federal income tax purposes under existing law, including
without limitation the Internal Revenue Code of 1986, as amended (the "Code"); (ii) will take all
actions reasonably within its power to take which are necessary to be taken (and avoid taking any
actions which are reasonably within its power to avoid taking and which are necessary to avoid)
so that the interest on the Bonds will not be or become included in gross income for federal income
tax purposes under the federal income tax laws as in effect from time to time; and(iii)will take no
action or permit any action in the investment of the proceeds of the Bonds, amounts held under the
Indenture or any other funds of the City which would result in making interest on the Bonds or the
Prior Bonds subject to federal income taxes by reason of causing the Bonds or the Prior Bonds to
be"arbitrage bonds"within the meaning of Section 148 of the Code, or direct or permit any action
inconsistent with the regulations under the Code as promulgated and as amended from time to time
and as applicable to the Bonds. The Mayor, City Clerk, City Treasurer and other Authorized
Officers of the City are authorized and directed to take all such actions as are necessary in order
to carry out the issuance and delivery of the Bonds including, without limitation, to make any
representations and certifications they deem proper pertaining to the use of the proceeds of the
Bonds or the Prior Bonds and other moneys held under the Indenture in order to establish that the
Bonds and the Prior Bonds shall not constitute arbitrage bonds as so defined.
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51642736.6
The City further covenants with the holders of the Bonds from time to time outstanding
that:
a. it will take all actions, if any, which shall be necessary in order further to
provide for the levy, extension, collection and application of the Special Taxes imposed by
or pursuant to this Ordinance, the Bond Order or the Establishing Ordinance, including
enforcement of the Special Taxes by providing the County of Kendall with such
information as is deemed necessary to enable it to include the property subject to the
delinquent tax in the County Collector's annual tax sale and in the event the tax lien is
forfeited at such tax sale upon request of any Bond Insurer or a majority of Bondholders
by instituting proceedings, including assigning to the Trustee its right to purchase as a
taxing district the unpaid taxes due upon the property, all in the manner provided by law;
provided,however,that the obligation to purchase unpaid taxes or institute any proceeding
shall only arise in the event the City makes the determination that sufficient funds are on
deposit in the Administrative Expense Fund to (i) pay all remaining Administrative
Expenses expected for such levy year, and (ii) apply to the purchase of the unpaid taxes
and/or pay the costs of any proceeding;
b. it will not take any action which would adversely affect the levy, extension,
collection and application of the Special Taxes, except to abate the Special Taxes to the
extent permitted by the Special Tax Roll and Report and to release the lien on a parcel upon
prepayment of the Special Tax for such parcel as described in the Indenture and as provided
in this Ordinance; and
c. it will comply with all present and future laws concerning the levy,
extension and collection of the Special Taxes; in each case so that the City shall be able to
pay the principal of and interest on the Bonds as they come due, to replenish the Reserve
Fund to the Reserve Requirement (as defined in the Indenture), or to restore the amount
available under any Reserve Fund Insurance Policy, together with cash on deposit in the
Reserve Fund, to the Reserve Requirement, and to replenish the Special Reserve Fund to
the Special Reserve Requirement (as defined in the Indenture), and it will take all actions
necessary to assure the timely collection of the Special Taxes,including without limitation,
the enforcement of any delinquent Special Taxes as described in paragraph (a) above.
Promptly following the date of issuance of the Bonds, the City shall file with the County
of Kendall an abatement ordinance abating the Special Taxes levied pursuant to the bond ordinance
for the Prior Bonds (the "Prior Bond Ordinance") for levy years 2024 through 2033. The City
hereby agrees to deposit with the Trustee for the Bonds any amounts collected from the 2023 levy
of Special Taxes pursuant to the Prior Bond Ordinance for deposit into the Bond and Interest Fund.
Section 8. Additional Authority. The Mayor, the City Clerk and the other officers of
the City are authorized to execute and deliver on behalf of the City such other documents,
agreements and certificates and to do such other things consistent with the terms of this Ordinance
as such officers and employees shall deem necessary or appropriate in order to effectuate the intent
and purposes of this Ordinance, including without limitation to make any representations and
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51642736.6
certifications they deem proper pertaining to the use of the proceeds of the Bonds in order to
establish that the Bonds and the Prior Bonds shall not constitute arbitrage bonds as defined in
Section 7 above.
Section 9. Transfer of Funds; Redemption of Prior Bonds. All amounts on deposit in
the funds and accounts created for the Prior Bonds shall be transferred to the Bond and Interest
Fund created under the Trust Indenture of the City pursuant to which the Prior Bonds were
authorized (the "Prior Indenture") and applied to redeem the Prior Bonds or, with respect to the
Bond and Interest Fund, the Reserve Fund or the Special Reserve Fund, may be transferred to the
Bond and Interest Fund, the Reserve Fund or the Special Reserve Fund created for the Bonds to
the extent not needed to fund the redemption price of the Prior Bonds as provided in the Bond
Order.
The Prior Bonds shall be called for redemption on the earliest practicable date on which
notice of redemption may be provided in accordance with the Prior Indenture and as specified in
the Bond Order, at a redemption price equal to 100% of the principal amount of the Prior Bonds
to be redeemed, plus accrued interest to the redemption date. Such redemption shall be conducted
in accordance with the provisions of the Prior Indenture.
Section 10. Filing of Ordinance. The City Clerk is directed to file a certified copy of
this Ordinance, and an accurate map of the Special Service Area,with the County Clerk of Kendall
County.
Section 11. Severability. If any section,paragraph,clause or provision of this Ordinance
(including any section, paragraph, clause or provision of any exhibit to this Ordinance) shall be
held invalid, the invalidity of such section, paragraph, clause or provision shall not affect any of
the other sections,paragraphs, clauses or provisions of this Ordinance (or of any of the exhibits to
this Ordinance).
Section 12. Repealer; Effect of Ordinance. All ordinances, resolutions and orders or
parts of ordinances,resolutions and orders in conflict with this Ordinance are repealed to the extent
of such conflict. The City Clerk shall cause this Ordinance to be published in pamphlet form. This
Ordinance shall be effective upon its passage and publication as provided by law.
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51642736.6
PASSED BY THE CITY COUNCIL OF THE UNITED CITY OF YORKVILLE,
KENDALL COUNTY, ILLINOIS this 12th day of March, 2024.
VOTING AYE: Koch, Plocher, Funkhouser, Transier, Soling, Marek, Corneils
VOTING NAY:
ABSENT: Tarulis
ABSTAINED:
NOT VOTING:
APPROVED: .7;.\1
Mayor
ATTEST:
eje914
ity lerk
•� / Coroorlrhe 'r''
• `�.
[Signature page to Bond Ordinance]
51642736.6
Exhibit A
UNITED CITY OF YORKVILLE, KENDALL COUNTY, ILLINOIS
SPECIAL SERVICE AREA NUMBER 2004-107
51642736.6
Exhibit B
Form of Trust Indenture
(See attached)
51642736.6
Exhibit C
Form of Bond Purchase Agreement
(See attached)
51642736.6
Exhibit D
Form of the Preliminary Official Statement
(See attached)
51642736.6
Exhibit E
Form of the Continuing Disclosure Agreement
(See attached)
51642736.6
Exhibit F
Form of the Agreement for Administrative Services
(See attached)
51642736.6
Exhibit A
UNITED CITY OF YORKVILLE, KENDALL COUNTY, ILLINOIS
SPECIAL SERVICE AREA NUMBER 2004-107
51642736.6
EXHIBIT A
LEGAL DESCRIPTION SSA SOUTH-RAINTREE VILLAGE
PART OF THE SOUTHWEST QUARTER OF SECTION 3 AND PART OF THE
EAST HALF OF SECTION 9 AND PART OF THE NORTHWEST QUARTER OF
SECTION 10, ALL IN TOWNSHIP 36 NORTH, RANGE 7 EAST OF THE THIRD
PRINCIPAL MERIDIAN,DESCRIBED AS FOLLOWS: BEGINNING AT THE MOST
SOUTHERLY CORNER OF LOT 110 OF RAINTREE VILLAGE UNIT ONE,
ACCORDING TO THE PLAT THEREOF RECORDED JANUARY 13, 2004 AS
DOCUMENT NO. 2004-00000938; THENCE THE FOLLOWING 18 COURSES
ALONG THE SUBDIVISON LINE OF SAID UNIT ONE; 1) NORTH 47° 04' 29"
EAST,33.00 FEET;2)THENCE NORTH 42°55':31" WEST, 90.00 FEET TO A POINT
OF CURVATURE; 3) THENCE NORTHWESTERLY AND NORTHERLY ALONG A
CURVE CONCAVE NORTHEASTERLY HAVING A RADIUS OF 370.00 FEET, AN
ARC LENGTH OF 277.19 FEET, A CHORD BEARING OF NORTH 21° 27' 45"
WEST, AND A CHORD DISTANCE OF 270.76 FEET; 4) THENCE NORTH 00° 00'
00" WEST, 73.86 FEET; 5) THENCE NORTH 90° 00' 00" EAST, 135.00 FEET; 6)
THENCE NORTH 50° 53' 55" EAST, 90.20 FEET; 7) THENCE NORTH 90° 00' 00"
EAST, 11.39 FEET TO A POINT OF CURVATURE; 8)THENCE NORTHEASTERLY
ALONG A CURVE CONCAVE NORTHWESTERLY HAVING A RADIUS OF 67.00
FEET,AN ARC LENGTH OF 61.89 FEET,A CHORD BEARING OF NORTH 63° 32'
15" EAST, AND A CHORD DISTANCE OF 59.71 FEET; 9) THENCE NORTH 37°04'
29" EAST, 566.88 FEET TO A POINT OF CURVATURE; 10) THENCE
NORTHEASTERLY, EASTERLY AND SOUTHEASTERLY ALONG A CURVE
CONCAVE SOUTHERLY HAVING A RADIUS OF 158.00 FEET,AN ARC LENGTH
OF 246.22 FEET, A CHORD BEARING OF NORTH 81° 43' 09" EAST AND A
CHORD DISTANCE OF 222,05 FEET; 11) THENCE NORTH 36° 21' 48" EAST,
125.19 FEET; 12) THENCE NORTH 89° 45' 41" EAST, 284.11 FEET; 13) THENCE
NORTH 00° 14' 19" WEST, 80.00 FEET; 14) THENCE SOUTH 89° 45' 41" WEST,
135.00 FEET; 15) THENCE NORTH 00° 14' 19" WEST, 106.00 FEET; 16) THENCE
NORTH 89° 45' 41" EAST, 201.00 FEET; 17) THENCE NORTH 00° 14' 19" WEST,
58.58 FEET TO A POINT OF CURVATURE; 18)THENCE NORTHERLY ALONG A
CURVE CONCAVE WESTERLY HAVING A RADIUS OF 333.00 FEET, AN ARC
LENGTH OF 96,34 FEET,A CHORD BEARING OF NORTH 08°31' 35"WEST,AND
A CHORD DISTANCE OF 96.00 FEET TO A POINT OF REVERSE CURVATURE,
ALSO BEING A POINT ON A WESTERLY LINE OF RAINTREE VILLAGE UNIT
TWO, ACCORDING TO THE PLAT THEREOF RECORDED AUGUST 19, 2004 AS
DOCUMENT NO. 2004-00023274; THENCE THE FOLLOWING 16 COURSES
ALONG THE SUBDIVISION LINE OF SAID UNIT TWO; 1) THENCE
NORTHERLY, NORTHEASTERLY AND EASTERLY ALONG A CURVE
CONCAVE SOUTHEASTERLY HAVING A RADIUS OF 25.00 FEET, AN ARC
LENGTH OF 40.39 FEET,A CHORD BEARING OF NORTH 29°28' 02" EAST AND
A CHORD DISTANCE OF 36.14 FEET TO A POINT OF COMPOUND
CURVATURE; 2) THENCE EASTERLY ALONG A CURVE CONCAVE
SOUTHERLY HAVING A RADIUS OF 1272.00 FEET,AN ARC LENGTH OF 291.50
FEET, A CHORD BEARING OF NORTH 82° 18' 51" EAST AND A CHORD
DISTANCE OF 290.87 FEET; 3) THENCE NORTH 88° 52' 46" EAST, 288.16 FEET
TO A POINT OF CURVATURE; 4)THENCE EASTERLY, SOUTHEASTERLY AND
SOUTHERLY ALONG A CURVE CONCAVE SOUTHWESTERLY HAVING A
RADIUS OF 25.00 FEET, AN ARC LENGTH OF 39.65 FEET, A CHORD BEARING
OF SOUTH 45° 40' 46" EAST AND A CHORD DISTANCE OF 35.63 FEET; 5)
THENCE SOUTH 00° 14' 19" EAST, 298.77 FEET; 6) THENCE SOUTH 89° 45' 41"
WEST, 270.00 FEET; 7) THENCE SOUTH 71° 50' 06" WEST, 69.37 FEET; 8)
THENCE SOUTH 89° 45' 41" WEST, 270.00 FEET; 9) THENCE SOUTH 00° 14' 19"
EAST, 80.00 FEET; 10) THENCE NORTH 89° 45' 41" EAST, 270.00 FEET; 11)
THENCE NORTH 71° 50' 06" EAST, 69.37 FEET; 12) THENCE NORTH 89° 45' 41"
EAST, 336.00 FEET; 13) THENCE NORTH 00° 14' 19" WEST, 32.51 FEET TO A
POINT OF CURVATURE; 14) THENCE NORTHERLY, NORTHEASTERLY AND
EASTERLY ALONG A CURVE CONCAVE SOUTHEASTERLY HAVING A
RADIUS OF 25.00 FEET, AN ARC LENGTH OF 38.88 FEET, A CHORD BEARING
OF NORTH 44° 19' 14" EAST AND A CHORD DISTANCE OF 35.08 FEET; 15)
THENCE NORTH 88° 52'46" EAST,485.43 FEET; 16) THENCE SOUTH 01° 07' 14"
EAST, 626.99 FEET; THENCE NORTH 88° 52' 46" EAST, 508.12 FEET TO AN
EASTERLY LINE OF SAID UNIT TWO; THENCE NORTH 01° 07' 14" WEST
ALONG SAID EASTERLY LINE, 626.99 FEET TO THE SOUTHERLY LINE OF
SAID UNIT TWO;THENCE NORTH 88° 52'46" EAST, 399.03 FEET ALONG SAID
SOUTHERLY LINE, TO A POINT OF CURVATURE; THENCE EASTERLY AND
NORTHEASTERLY ALONG SAID SOUTHERLY LINE, BEING A CURVE
CONCAVE NORTHWESTERLY HAVING A RADIUS OF 390.00 FEET, AN ARC
LENGTH OF 341.45 FEET, A CHORD BEARING OF NORTH 63° 47' 52" EAST,
AND A CHORD DISTANCE OF 330,65 FEET; THENCE NORTH 38° 42' 59" EAST,
1716.64 FEET ALONG THE SOUTHERLY LINE OF SAID UNIT TWO, AND THE
SOUTHERLY LINE OF RAINTREE VILLAGE UNIT THREE, ACCORDING TO
THE PLAT THEREOF RECORDED AUGUST 19, 2004 AS DOCUMENT NO, 2004-
00023275, TO A POINT ON THE CENTERLINE OF ILLINOIS ROUTE 126
THROUGH WHICH A RADIAL LINE BEARS NORTH 39° 23' 36" EAST; THENCE
SOUTHEASTERLY ALONG SAID CENTERLINE, BEING A CURVE CONCAVE
SOUTHWESTERLY HAVING A RADIUS OF 6875.55 FEET, AN ARC LENGTH OF
232.44 FEET, A CHORD BEARING OF SOUTH 49° 38' 17" EAST AND A CHORD
DISTANCE OF 232.43 FEET TO THE EAST LINE OF THE SOUTHWEST
QUARTER OF SAID SECTION 3; THENCE SOUTH 00° 03' 41" WEST ALONG
SAID EAST LINE, 775.42 FEET TO THE NORTHEAST CORNER OF THE
NORTHWEST QUARTER OF SAID SECTION 10; THENCE SOUTH 00° 06' 21"
EAST ALONG THE EAST LINE OF SAID NORTHWEST QUARTER, 1306.31 FEET
TO THE NORTH LINE OF PARCEL ONE AS DESCRIBED BY DOCUMENT NO.
78-2764; THENCE SOUTH 88° 52' 46" WEST ALONG SAID NORTH LINE, 2654.27
FEET TO THE NORTHWEST CORNER OF SAID PARCEL ONE, ALSO BEING A
POINT ON THE WEST LINE OF THE NORTHWEST QUARTER OF SAID
SECTION 10; THENCE SOUTH 00° 14' 19" EAST ALONG SAID WEST LINE,
1317.03 FEET TO THE WEST QUARTER CORNER OF SAID SECTION 10;
THENCE SOUTH 00° 02' 59" EAST ALONG THE WEST LINE OF THE
SOUTHWEST QUARTER OF SAID SECTION, 659.40 FEET TO THE
SOUTHEASTERLY PROJECTION OF THE EASTERLY LINE OF WINDETT RIDGE
SUBDIVISION UNIT 1, ACCORDING TO THE FIAT THEREOF RECORDED
FEBRUARY 13, 2004 AS DOCUMENT NO. 2004-00003630; THENCE NORTH 52°
55' 31" WEST ALONG SAID EASTERLY LINE, 2643.92 FEET TO THE POINT OF
BEGINNING, IN THE UNITED CITY OF YORKVILLE, KENDALL COUNTY,
ILLINOIS (CONTAINING 157.763 f ACRES)
Exhibit B
Form of Trust Indenture
(See attached)
51642736.6
TRUST INDENTURE
between
UNITED CITY OF YORKVILLE,KENDALL COUNTY, ILLINOIS
and
AMALGAMATED BANK OF CHICAGO
as Trustee
Dated as of March 1,2024
UNITED CITY OF YORKVILLE, KENDALL COUNTY,ILLINOIS
SPECIAL SERVICE AREA NUMBER 2004-107
SPECIAL TAX REFUNDING BONDS, SERIES 2024
(RAINTREE VILLAGE II PROJECT)
51659324.8
TABLE OF CONTENTS
ARTICLE 1 STATUTORY AUTHORITY AND DEFINITIONS 3
Section 1.1 Authority for this Indenture 3
Section 1.2 Agreement for Benefit of Owners of the Series 2024 Bonds 3
Section 1.3 Definitions 3
ARTICLE 2 BOND DETAILS 10
Section 2.1 Purpose of Issuance; Amount of Series 2024 Bonds 10
Section 2.2 Form; Denominations; Numbers 10
Section 2.3 Date of Bonds: CUSIP Identification Numbers 10
Section 2.4 Maturity; Interest Rate 10
Section 2.5 Interest 10
Section 2.6 Form of Series 2024 Bonds; Execution; Authentication 11
Section 2.7 Payment of the Series 2024 Bonds 11
Section 2.8 Appointment of Trustee 11
Section 2.9 Registration of Series 2024 Bonds; Persons Treated as Owners 11
Section 2.10 Global Form; Securities Depository 12
Section 2.11 Additional Bonds 14
ARTICLE 3 REDEMPTION OF SERIES 2024 BONDS 14
Section 3.1 Mandatory Sinking Fund Redemption 14
Section 3.2 Optional Redemption 14
Section 3.3 Mandatory Redemption upon Condemnation 14
Section 3.4 Special Mandatory Redemption from Optional Prepayment of
Special Tax 15
Section 3.5 Redemption Provisions;Notice of Redemption 15
Section 3.6 Purchase in Lieu of Redemption 16
ARTICLE 4 APPLICATION OF PROCEEDS AND OTHER AMOUNTS 16
Section 4.1 Application of Proceeds 16
Section 4.2 Amounts Held for Prior Bonds 17
ARTICLE 5 SECURITY FOR THE SERIES 2024 BONDS 17
Section 5.1 Limited Obligations 17
Section 5.2 Levy of Special Tax 17
Section 5.3 Bond Insurance Policy; Covenants in Favor of Bond Insurer 18
Section 5.4 Provisions Relating to Reserve Policy 25
ARTICLE 6 FUNDS AND ACCOUNTS 26
Section 6.1 Bond and Interest Fund 26
Section 6.2 Reserve Fund 28
Section 6.3 Special Reserve Fund 30
Section 6.4 Administrative Expense Fund 30
Section 6.5 Rebate Fund 31
Section 6.6 Investment of Funds 31
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ARTICLE 7 COVENANTS AND AGREEMENTS OF THE CITY 32
Section 7.1 Tax Covenants 32
Section 7.2 Levy and Collection of Taxes 33
Section 7.3 Proper Books and Records 34
Section 7.4 Against Encumbrances 34
Section 7.5 Continuing Disclosure Undertaking 34
ARTICLE 8 DEFAULTS AND REMEDIES 34
Section 8.1 Events of Default 34
Section 8.2 Remedies 35
Section 8.3 Notice of Default 35
Section 8.4 Termination of Proceedings by Trustee 35
Section 8.5 Right of Bondholders to Control Proceedings 36
Section 8.6 Right of Bondholders to Institute Suit 36
Section 8.7 Suits by Trustee 36
Section 8.8 Remedies Cumulative 37
Section 8.9 Waiver of Default 37
Section 8.10 Application of Moneys After Default 37
Section 8.11 Bond Insurer Control 38
ARTICLE 9 TRUSTEE 38
Section 9.1 Appointment of the Trustee 38
Section 9.2 Performance of Duties 38
Section 9.3 Instruments Upon Which Trustee May Rely 39
Section 9.4 Trustee not Responsible for Recitals and Other Matters 40
Section 9.5 Trustee May Acquire Series 2024 Bonds 40
Section 9.6 Qualification of Trustee 40
Section 9.7 Resignation or Removal of Trustee and Appointment of Successor 41
Section 9.8 Concerning the Successor Trustee 42
Section 9.9 Monthly Statements 42
ARTICLE 10 SUPPLEMENTAL INDENTURES 42
Section 10.1 Supplemental Indentures Not Requiring Consent of Bondholders 42
Section 10.2 Supplemental Indentures Requiring Consent of Bondholders 43
Section 10.3 Supplemental Indenture to Modify this Indenture 44
Section 10.4 Trustee May Rely Upon Opinion of Counsel Re: Supplemental
Indenture 44
Section 10.5 Notation 44
Section 10.6 Opinion of Bond Counsel 44
ARTICLE 11 DEFEASANCE 45
Section 11.1 Defeasance 45
ARTICLE 12 MISCELLANEOUS 47
Section 12.1 Severability 47
Section 12.2 Notices 47
Section 12.3 Holidays 48
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51659324.8
Section 12.4 Execution of Counterparts 48
Section 12.5 Applicable Law 48
Section 12.6 Immunity of Officers, Employees, Elected Officials of City 48
Exhibit A — United City of Yorkville Special Service Area Number 2004-107 Legal Description
Exhibit B — Form of Bond
Exhibit C — Form of Satisfaction of Tax Lien
Exhibit D — Form of Costs of Issuance Disbursement Request
51659324.8
TRUST INDENTURE
THIS TRUST INDENTURE (the "Indenture") is made and entered into as of March 1,
2024, by and between the United City of Yorkville, Kendall County, Illinois, a municipal
corporation organized and existing under and by virtue of the Constitution and laws of the State
of Illinois (the "City"), and Amalgamated Bank of Chicago, Chicago, Illinois, a state banking
corporation, as trustee (the"Trustee").
WITNESSETH:
WHEREAS,by Ordinance No.2005-90 adopted at a meeting held on November 22,2005,
the City has established the"United City of Yorkville Special Service Area Number 2004-107"as
further described in Exhibit A to this Indenture (the "Special Service Area Number 2004-107");
and
WHEREAS, on November 22, 2005, the Mayor and City Council (the "Corporate
Authorities") adopted Ordinance No. 2005-91 pursuant to the Special Service Area Tax Law, 35
ILCS 200/27-5,et seq. (the"Special Service Area Act")and determined it to be in the best interests
of the City to issue $9,400,000 principal amount of the United City of Yorkville Special Service
Area Number 2004-107, Special Tax Bonds, Series 2005 (Raintree Village II Project) (the "Prior
Bonds")for the purpose of providing a portion of the funds needed for costs of the Special Services
(as defined below)within Special Service Area Number 2004-107; and
WHEREAS, on March 12, 2024,the Corporate Authorities adopted Ordinance No. 2024-
, as supplemented by a Bond Order executed pursuant thereto (the "Bond Ordinance") and
pursuant to the Special Service Area Act, determined it to be in the best interests of the City to
issue not to exceed $6,000,000 principal amount of the United City of Yorkville, Kendall County,
Illinois Special Service Area Number 2004-107 Special Tax Refunding Bonds, Series 2024
(Raintree Village II Project) (the "Series 2024 Bonds") for the purpose of refunding the Prior
Bonds; and
WHEREAS,the Bond Ordinance authorized the Mayor and City Clerk to establish certain
specific terms of the Series 2024 Bonds by executing and delivering a Bond Purchase Agreement
with the Purchaser(defined below) and a Bond Order pursuant to the Bond Ordinance; and
WHEREAS, pursuant to the terms so established the City will issue $ principal
amount of Series 2024 Bonds upon the terms specified in this Indenture; and
WHEREAS, it is in the public interest and for the benefit of the City, Special Service Area
Number 2004-107 (the "Special Service Area") and the owners of the Series 2024 Bonds that the
City enter into this Indenture to provide for the issuance of the Series 2024 Bonds, the
disbursement of proceeds of the Series 2024 Bonds, the deposit of the Special Taxes levied
pursuant to the Bond Ordinance securing the Series 2024 Bonds, and the administration and
payment of the Series 2024 Bonds; and
WHEREAS, all things necessary to cause the Series 2024 Bonds, when executed by the
City and issued as provided in the Special Service Area Act, the Local Government Debt Reform
Act(as defined below),the Bond Ordinance and this Indenture,to be legal, valid and binding and
51659324.8
special obligations of the City in accordance with their terms,and all things necessary to cause the
creation, authorization, execution and delivery of this Indenture and the creation, authorization,
execution and issuance of the Series 2024 Bonds, subject to the terms of this Indenture, have in all
respects been duly authorized;
NOW, THEREFORE,THIS INDENTURE OF TRUST WITNESSETH:
GRANTING CLAUSES
That the City in consideration of the premises, the acceptance by the Trustee of the trusts
created hereby and the purchase and acceptance of the Series 2024 Bonds by the owners thereof,
and of the sum of one hundred dollars, lawful money of the United States of America, to it duly
paid by the Trustee at or before the execution and delivery of these presents, and for other good
and valuable consideration,the receipt and sufficiency of which are hereby acknowledged, in order
to secure the payment of the principal of, premium, if any, and interest on the Series 2024 Bonds
according to their tenor and effect, and to secure the performance and observance by the City of
all the covenants expressed or implied herein and in the Series 2024 Bonds, does hereby pledge
and assign, and grant a security interest in, the following to the Trustee, and its successors in trust
and assigns forever,to secure the performance of the obligations of the City hereinafter set forth;
GRANTING CLAUSE FIRST
All right,title and interest of the City in and to the Special Taxes (defined below) and any
monies held under this Indenture by the Trustee, including the proceeds of the Series 2024 Bonds
and the interest, profits and other income derived from the investment thereof other than amounts
held by the Trustee in the Administrative Expense Fund,the Special Reserve Fund and the Rebate
Fund;
GRANTING CLAUSE SECOND
All funds, monies, property and security and any and all other rights and interests in
property whether tangible or intangible from time to time hereafter by delivery or by writing of
any kind, conveyed, mortgaged, pledged, assigned or transferred as and for additional security
hereunder for the Series 2024 Bonds by the City or by anyone on its behalf or with its written
consent including without limitation the Bond Insurance Policy and the proceeds paid thereunder,
to the Trustee,which is hereby authorized to receive any and all such property at any and all times
and to hold and apply the same subject to the terms hereof;
TO HAVE AND TO HOLD, all and singular the Trust Estate, whether now owned or
hereafter acquired, unto the Trustee and its respective successors in said trust and assigns forever;
IN TRUST NEVERTHELESS, upon the terms and trust herein set forth for the equal and
proportionate benefit, security and protection of all present and future owners of the Series 2024
Bonds from time to time issued under and secured by this Indenture without privilege, priority or
distinction as to the lien or otherwise of any of the Series 2024 Bonds over any of the other Series
2024 Bonds (except as otherwise provided herein);
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PROVIDED, HOWEVER,that if the City, its successors or assigns, shall pay, or cause to
be paid,the principal of, premium, if any, and interest on the Series 2024 Bonds due or to become
due thereon, at the times and in the manner mentioned in the Series 2024 Bonds according to the
true intent and meaning thereof,and shall cause the payments to be made on the Series 2024 Bonds
as required under this Indenture, or shall provide, as permitted hereby, for the payment thereof by
depositing with the Trustee the entire amount due or to become due thereon and shall cause to be
kept, performed and observed all of its covenants and conditions pursuant to the terms of this
Indenture,and shall pay or cause to be paid all sums of money due or to become due in accordance
with the terms and provisions hereof, then upon the final payment thereof, this Indenture and the
rights hereby granted shall cease, determine and be void; otherwise this Indenture is to be and
remain in full force and effect.
THIS INDENTURE OF TRUST FURTHER WITNESSETH, and it is expressly declared,
that all Series 2024 Bonds issued and secured hereunder are to be issued, authenticated and
delivered and all said property, rights and interests, and amounts hereby assigned and pledged are
to be dealt with and disposed of under, upon and subject to the terms, conditions, stipulations,
covenants, agreements,trusts, uses and purposes as herein expressed, and the City has agreed and
covenanted, and does hereby agree and covenant with the Trustee and with the respective owners
of the Series 2024 Bonds as follows:
ARTICLE 1
STATUTORY AUTHORITY AND DEFINITIONS
Section 1.1 Authority for this Indenture. This Indenture is entered into pursuant to the
powers of the City pursuant to Part 6 of Section 7 of Article VII of the 1970 Constitution of the
State of Illinois and pursuant to the respective provisions of the Special Service Area Act, the
Local Government Debt Reform Act and the Bond Ordinance.
Section 1.2 Agreement for Benefit of Owners of the Series 2024 Bonds. The
provisions, covenants and agreements to be performed by or on behalf of the City under this
Indenture shall be for the equal benefit, protection and security of the Bondholders except as
otherwise expressly provided herein. All of the Series 2024 Bonds, without regard to the time or
times of their issuance or maturity, shall be of equal rank without preference,priority or distinction
of any of the Series 2024 Bonds over any other of the Series 2024 Bonds, except as expressly
provided in or permitted by this Indenture. The Trustee may become the owner of any of the Series
2024 Bonds in its own or any other capacity with the same rights it would have if it were not the
Trustee.
Section 1.3 Definitions. Unless the context otherwise requires,the terms defined in this
Section 1.3 shall, for all purposes of the Indenture, of any Supplemental Indenture, and of any
certificate, opinion or other document mentioned in this Indenture, have the meanings specified
below. All references in this Indenture to "Articles," "Sections" and other subdivisions are to the
corresponding Articles, Sections or subdivisions of this Indenture, and the words "herein,"
"hereof,""hereunder"and other words of similar import refer to this Indenture as a whole and not
to any particular Article, Section or subdivision of this Indenture.
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51659324.8
"Administrative Expenses" means the following actual or reasonably estimated costs
permitted in accordance with the Special Service Area Act and directly related to the
administration of the Special Service Area and the Series 2024 Bonds as determined by the City
or the Consultant on its behalf: the costs of computing the Special Taxes and of preparing the
annual Special Tax collection schedules and the amended Special Tax Roll;the costs of collecting
the Special Taxes(whether by the City,the County or otherwise),the costs of remitting the Special
Taxes to the Trustee; the costs of the Trustee and any fiscal agent (including its legal counsel) in
the discharge of the duties required of it under this Indenture or any trustee or fiscal agent
agreement;the costs of applying for and maintaining ratings from any nationally recognized rating
agency; the fees and expenses of the Bond Insurer required to be paid by the City to the Bond
Insurer pursuant to the provisions of this Indenture; the costs of the Rebate Consultant; the costs
of the City or its designee in complying with disclosure requirements of applicable federal and
state securities laws and of the Special Service Area Act, including, but not limited to, public
inquiries regarding the Special Taxes, any termination payments owed by the City in connection
with any guaranteed investment contract,forward purchase agreement or other investment of funds
held under this Indenture; the costs associated with the release of funds from any escrow account
or fund held under this Indenture; and amounts advanced by the City for any other administrative
purposes of the Special Service Area, including the costs of computing Special Tax prepayment
amounts, recordings related to the prepayment, discharge or satisfaction of Special Tax; the costs
of commencing foreclosure and pursuing collection of delinquent Special Tax; and the reasonable
fees of legal counsel of the City or the Trustee incurred in connection with any of the foregoing.
"Administrative Expense Fund" means the fund by that name established pursuant to
Section 6.4 of this Indenture.
"Administrative Services Agreement" means the Agreement for Administrative Services
entered into as of the date hereof between the City and the Consultant.
"Authorized Denomination" means denominations of $5,000 and integral multiples of
$1,000 in excess thereof.
"Authorized Officer" means the Mayor, the City Clerk, the Treasurer, or any other officer
designated as such pursuant to a certificate of the Mayor delivered to the Trustee.
"Beneficial Owner" means, when the Series 2024 Bonds are in a book-entry system, any
person who acquires a beneficial ownership interest in a Series 2024 Bond held by DTC.
"Bond and Interest Fund"means the fund by that name established pursuant to Section 6.1
of this Indenture.
"Bond Insurance Policy" means the municipal bond insurance policy issued by the Bond
Insurer guaranteeing the scheduled payment of principal of and interest on the Series 2024 Bonds
when due.
"Bond Insurer" or" " means , or any successor thereto or assignee
thereof.
"Bond Registrar"means Amalgamated Bank of Chicago and its successors or assigns.
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"Bondholder," "Holder" or "Owner" means the person in whose name such Series 2024
Bond is registered in the bond register maintained by the Bond Registrar.
"Business Day" means a day on which banks in Chicago, Illinois, and New York, New
York are open to transact business.
"City" means the United City of Yorkville, Kendall County, Illinois.
"Code" means the Internal Revenue Code of 1986, as amended.
"Consultant" means DTA, formerly known as David Taussig & Associates, Inc., and its
successors and assigns or any other firm selected by the City to assist it in administering the Special
Service Area and the extension and collection of Special Taxes pursuant to the Special Tax Roll
and Report.
"Continuing Disclosure Agreement"means the Continuing Disclosure Agreement between
the City and the Dissemination Agent named therein.
"Corporate Authorities" means the Mayor and City Council of the City.
"Costs of Issuance Account" means the account by that name established pursuant to
Section 6.4 of this Indenture.
"County"means Kendall County, Illinois.
"Defeasance Securities" means any bond or other obligations which, as to both principal
and interest, constitute direct obligations of, or the timely payment of which are unconditionally
guaranteed by, the United States of America, and any certificates or any other evidences of an
ownership interest in obligations or in specified portions thereof(which may consist of specified
portions of the interest thereon) of the character described in this definition.
"Depository Participant" shall have the meaning given that term in Section 2.10 of this
Indenture.
"Disbursement Request" means a request from the City signed by an Authorized Officer
requesting a disbursement of amounts held in the Cost of Issuance Account in the form attached
hereto as Exhibit D.
"DTC"means The Depository Trust Company,New York,New York.
"Establishing Ordinance"means Ordinance No. 2005-90 adopted on November 22, 2005.
"Event of Default" shall have the meaning given that term in Section 8.1 of this Indenture.
"Foreclosure Proceeds" means the proceeds of any redemption or sale of property in the
Special Service Area sold as the result of a foreclosure action of the lien of the Special Taxes.
"Government Securities"means bonds,notes,certificates of indebtedness,treasury bills or
other securities constituting direct obligations of the United States of America and all securities
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51659324.8
and obligations,the prompt payment of principal of and interest on which is guaranteed by a pledge
of the full faith and credit of the United States of America.
"Indenture" means this Trust Indenture dated as of March 1, 2024 between the City and
the Trustee, as amended and supplemented from time to time.
"Indirect Participant" shall have the meaning given that term in Section 2.10 of this
Indenture.
"Insured Obligations" means the Series 2024 Bonds.
"Insurer Default" has the meaning set forth in Section 5.3(0(7) of this Indenture.
"Interest Payment Date" means March 1 and September 1 of each year commencing on
September 1, 2024.
"Late Payment Rate"means the lesser of(a)the greater of(i)the per annum rate of interest,
publicly announced from time to time by JPMorgan Chase Bank, N.A., at its principal office in
The City of New York, New York, as its prime or base lending rate ("Prime Rate") (any change
in such Prime Rate to be effective on the date such change is announced by JPMorgan Chase Bank,
N.A.) plus 3%, and (ii) the then applicable highest rate of interest on the Series 2024 Bonds and
(b)the maximum rate permissible under applicable usury or similar laws limiting interest rates. In
the event JPMorgan Chase Bank,N.A., ceases to announce its Prime Rate,the Prime Rate shall be
the prime or base lending rate of such other bank, banking association or trust company as the
Bond Insurer, in its sole and absolute discretion, shall designate. Interest at the Late Payment Rate
on any amount owing to the Bond Insurer shall be computed on the basis of the actual number of
days elapsed in a year of 360 days.
"Letter of Representations" means the Blanket Issuer Letter of Representations dated
August 29, 2002 from the City to DTC, as amended from time to time.
"Local Government Debt Reform Act"means the Local Government Debt Reform Act, 30
ILCS §350/1 et seq., as amended.
"Official Statement" means the Official Statement dated March , 2024 relating to the
Bonds.
"Parcel" shall have the meaning given that term in the Special Tax Roll and Report.
"Prior Bonds" means the United City of Yorkville Special Service Area Number 2004-
107, Special Tax Bonds, Series 2005 (Raintree Village II Project).
"Prior Bonds Administrative Expense Fund" means the Administrative Expense Fund
established with the Prior Bond Trustee for the Prior Bonds.
"Prior Bond Trustee" means The Bank of New York Mellon Trust Company, N.A., as
trustee for the Prior Bonds.
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"Purchase Contract" means the Bond Purchase Agreement dated March , 2024
between the Purchaser and the City.
"Purchaser" means D.A. Davidson& Co.
"Qualified Investments" means, to the extent permitted by then applicable Illinois law, the
following:
(a) Government Securities;
(b) bonds, notes, debentures, or other similar obligations of the United States
of America or its agencies,rated in the highest general classification established by a rating service
of nationally recognized expertise in rating such obligations, including (i) federal land banks,
federal intermediate credit banks, banks for cooperative, federal farm credit banks, or any other
entity authorized to issue debt obligations under the Farm Credit Act of 1971 (12 U.S.C. 2001 et
seq.); (ii) the federal home loan banks and the federal home loan mortgage corporation; and (iii)
any other agency created by Act of Congress;
(c) interest bearing certificates of deposit, interest bearing savings accounts,
interest bearing time deposits, or other investments constituting direct obligations of any bank as
defined by the Illinois Banking Act which are insured by the Federal Deposit Insurance
Corporation;
(d) money market mutual funds registered under the Investment Company Act
of 1940 as amended (including those of an affiliate of the Trustee for which the Trustee or any of
its affiliates provides management advisory or other services) invested solely in obligations listed
in paragraph (a) and (b) above including any mutual fund from which the Trustee or any of its
affiliates may receive compensation;
together with such other investments as shall from time to time be lawful for the investment of
City funds and shall be approved by the holders of not less than fifty-one percent (51%) of
aggregate principal amount of Series 2024 Bonds outstanding; provided that "Qualified
Investments" shall not include a financial instrument, commonly known as a "derivative," whose
performance is derived, at least in part, from the performance of any underlying asset, including,
without limitation, futures, options on securities, options on futures, forward contracts, swap
agreements, structured notes and participations in pools of mortgages or other assets.
"Rebate Consultant"means an entity selected by the City expert in the calculation of rebate
amounts pursuant to Section 148 of the Internal Revenue Code of 1986,as amended. If at any time
the Rebate Consultant resigns or is removed, and the City shall not have appointed a successor
within 30 days,the Rebate Consultant shall be an entity selected by the Trustee.
"Rebate Fund" means the fund by that name established pursuant to Section 6.5 of this
Indenture.
"Rebate Requirement" shall have the meaning given that term in Section 7.1(b) of this
Indenture.
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"Record Date" means the fifteenth day of the month preceding an Interest Payment Date.
"Reserve Fund" means the fund by that name created pursuant to Section 6.2 of this
Indenture.
"Reserve Policy" means the Reserve Fund Surety Policy issued by the Bond Insurer for
deposit to the credit of the Reserve Fund.
"Reserve Fund Credit" shall have the meaning given that term in Section A of Exhibit B
to the Special Tax Roll and Report.
"Reserve Fund Surety Policy" means the Reserve Policy and any other insurance policy,
surety bond or other evidence of insurance procured by the City and deposited to the credit of the
Reserve Fund (or any account or subaccount therein) in lieu of or in partial substitution for cash
or securities on deposit therein, in order to guarantee or assure the timely payment of principal or
interest, or both, of outstanding Bonds in a stated amount subject only to notification that there are
insufficient funds therefor. Any such Reserve Fund Surety Policy shall constitute an unconditional
senior obligation of the issuer thereof. The issuer of the Reserve Policy shall be
and the issuer of any substitute or additional Reserve Fund Surety Policy shall be a municipal bond
insurer which has been approved by the Bond Insurer.This definition shall also include any related
covenants or agreements contained in a side document with the insurer in order to obtain the
Reserve Fund Surety Policy,including,but not limited to,the Insurance Agreement dated
2024 between the City and
"Reserve Requirement"means an amount equal to $ as reduced by the amount
of Reserve Fund Credits in connection with prepayments as set forth in Section 6.1 of this
Indenture.
"Security Documents" shall mean this Indenture, the Bond Ordinance, the Series 2024
Bonds and/or any additional or supplemental document executed in connection with the Series
2024 Bonds.
"Series 2024 Bonds"means the City's Special Service Area Number 2004-107 Special Tax
Refunding Bonds, Series 2024 (Raintree Village II Project) in the aggregate principal amount of
"Special Redemption Account" means the account by that name established pursuant to
Section 6.1 of this Indenture.
"Special Reserve Fund" means the fund by that name created pursuant to Section 6.3 of
this Indenture.
"Special Reserve Fund Credit"means, with respect to each Parcel, the difference between
(A)the amount of the prepayment of the principal allocable to such Parcel calculated in accordance
with the Special Tax Roll and Report and (B) the principal allocable to such Parcel calculated in
accordance with the Special Tax Roll and Report if the Prior Bonds remained outstanding and the
Series 2024 Bonds were not issued, as determined by the Consultant.
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"Special Reserve Fund Requirement" means an amount equal to [ ] to fund
Special Reserve Fund Credits for possible prepayments.
"Special Service Area" means United City of Yorkville Special Service Area Number
2004-107, described more fully in Exhibit A to this Indenture.
"Special Service Area Act" means the Special Service Area Tax Law, 35 ILCS §200/27-5
et seq., as amended.
"Special Services"means the improvements benefiting the Special Service Area consisting
of engineering, soil testing and appurtenant work, mass grading and demolition, storm water
management facilities, storm drainage systems and storm sewers, site clearing and tree removal,
public water facilities, sanitary sewer facilities, erosion control measures, roads, streets, curbs,
gutters, street lighting, traffic controls, sidewalks, equestrian paths and related street
improvements, and equipment and materials necessary for the maintenance thereof, landscaping,
wetland mitigation and tree installation, costs for land and easement acquisitions relating to any of
the foregoing improvements, required tap-on and related fees for water or sanitary sewer services
and other eligible costs to serve the Special Service Area.
"Special Tax Requirement"means the "Special Tax Requirement" as defined in Section II
of the Special Tax Roll and Report, provided that credit may be given for any amounts on deposit
in the Funds and Accounts created by this Indenture and available to pay the Special Tax
Requirement.
"Special Tax Roll" means the special tax roll for the payment of the Series 2024 Bonds
established and amended from time to time pursuant to the Special Tax Roll and Report.
"Special Tax Roll and Report" means the United City of Yorkville Special Service Area
Number 2004-107 Special Tax Roll and Report including all exhibits attached thereto, prepared
by the Consultant as amended from time to time.
"Special Taxes" means the taxes levied by the City on all taxable real property within the
Special Service Area pursuant to the Special Tax Roll and this Indenture.
"Supplemental Indenture"means an indenture adopted by the Corporate Authorities of the
City as provided in Article 10 hereof which amends or supplements this Indenture.
"Tax Agreement"or"Tax Agreements" means the Tax Compliance Agreement of the City
dated the date of issuance and delivery of the Series 2024 Bonds, as amended from time to time.
"Trustee" means Amalgamated Bank of Chicago, Chicago, Illinois and its successors and
assigns.
"Trust Estate" means the property conveyed to the Trustee pursuant to the Granting
Clauses of this Indenture.
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ARTICLE 2
BOND DETAILS
Section 2.1 Purpose of Issuance; Amount of Series 2024 Bonds. The sum of
$ shall be borrowed by the City pursuant to the Special Service Area Act and the Local
Government Debt Reform Act for the purpose of paying a portion of the costs of defeasing and
currently refunding the Prior Bonds, including the costs of the City in connection with the issuance
of the Series 2024 Bonds (including, without limitation, the premiums for the Bond Insurance
Policy and the Reserve Policy) and deposits to the Reserve Fund. In evidence of such borrowing,
Series 2024 Bonds in the aggregate principal amount of$ shall be issued as provided
in this Indenture.The total principal amount of Bonds that may be issued pursuant to this Indenture
is $
Section 2.2 Form; Denominations; Numbers. The Series 2024 Bonds shall be issued
only in fully registered form without coupons and in the denominations of$5,000 and integral
multiples of$1,000 in excess of that sum.
Section 2.3 Date of Bonds: CUSIP Identification Numbers. The Series 2024 Bonds
shall be dated as of the date of delivery of the Series 2024 Bonds to the Purchaser upon original
issuance. CUSIP identification numbers shall be imprinted on the Series 2024 Bonds, provided
that any failure on the part of the City or the Trustee to use such CUSIP numbers in any notice to
any Bondholders shall not constitute an event of default or any violation of the City's contract with
such Bondholders and shall not impair the effectiveness of such notice.
Section 2.4 Maturity; Interest Rate. The Series 2024 Bonds shall mature and become
payable on the date and in the amount and shall bear interest at the rate set forth below:
(March 1) Interest
Year Amount Rate
Section 2.5 Interest. The Series 2024 Bonds shall bear interest at the rates set forth in
Section 2.4 payable on the Interest Payment Dates in each year with the first Interest Payment Date
being September 1, 2024. Interest on the Series 2024 Bonds shall be calculated on the basis of a
360-day year composed of twelve 30-day months. Each Series 2024 Bond shall bear interest from
the Interest Payment Date next preceding the date of authentication of such Series 2024 Bond
unless(i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from
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such date of authentication, or (ii) it is authenticated prior to an Interest Payment Date and after
the close of business on the Record Date preceding such Interest Payment Date, in which event it
shall bear interest from such Interest Payment Date, or (iii) it is authenticated prior to the Record
Date preceding the first Interest Payment Date, in which event it shall bear interest from its dated
date; provided, however, that if at the time of authentication of a Series 2024 Bond, interest is in
default on such Series 2024 Bond, such Series 2024 Bond shall bear interest from the Interest
Payment Date to which interest had previously been paid or made available for payment on such
Series 2024 Bond.
Section 2.6 Form of Series 2024 Bonds; Execution; Authentication. The Series 2024
Bonds shall be in substantially the form set forth in Exhibit B to this Indenture. Each Series 2024
Bond shall be executed by the manual or facsimile signature of the Mayor and the manual or
facsimile signature of the City Clerk and shall have the corporate seal of the City affixed to it (or
a facsimile of that seal printed on it). The Mayor and the City Clerk(if they have not already done
so) are authorized and directed to file with the Illinois Secretary of State their manual signatures
certified by them pursuant to the Uniform Facsimile Signatures of Public Officials Act, as
amended, which shall authorize the use of their facsimile signatures to execute the Series 2024
Bonds. Each Series 2024 Bond so executed shall be as effective as if manually executed. In case
any officer of the City whose signature or a facsimile of whose signature shall appear on the Series
2024 Bonds shall cease to be such officer before authentication and delivery of any of the Series
2024 Bonds, that signature or facsimile signature shall nevertheless be valid and sufficient for all
purposes, the same as if the officer had remained in office until delivery.
No Series 2024 Bond shall be valid for any purpose unless and until a certificate of
authentication on that Series 2024 Bond substantially in the form set forth in the bond form in
Exhibit B to this Indenture shall have been duly executed by the Trustee appointed by this
Indenture as authenticating agent of the City. Execution of that certificate upon any Series 2024
Bond shall be conclusive evidence that the Series 2024 Bond has been authenticated and delivered
under this Indenture.
Section 2.7 Payment of the Series 2024 Bonds. The Series 2024 Bonds shall be payable
in lawful money of the United States at the office of the Trustee. The principal of each Series 2024
Bond shall be payable at maturity upon presentment of the Series 2024 Bond at the office of the
Trustee. Interest on each Series 2024 Bond shall be payable on each Interest Payment Date by
check or draft of the Trustee mailed to the person in whose name that Series 2024 Bond is
registered on the books of the Bond Registrar at the close of business on the Record Date. During
such time as the Series 2024 Bonds are registered so as to participate in a securities depository
system with DTC, principal of and interest and redemption premium on each Series 2024 Bond
shall be payable by wire transfer pursuant to instructions from DTC.
Section 2.8 Appointment of Trustee. Amalgamated Bank of Chicago,Chicago, Illinois,
is appointed Trustee and Bond Registrar for the Series 2024 Bonds.
Section 2.9 Registration of Series 2024 Bonds; Persons Treated as Owners. The Series
2024 Bonds shall be negotiable,subject to the following provisions for registration and registration
of transfer. The City shall maintain books for the registration of the Series 2024 Bonds at the office
of the Bond Registrar. Each Series 2024 Bond shall be fully registered on those books in the name
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of its owner,as to both principal and interest.Transfer of each Series 2024 Bond shall be registered
only on those books upon surrender of that Series 2024 Bond to the Bond Registrar by the
registered owner or his or her attorney duly authorized in writing together with a written instrument
of transfer satisfactory to the Bond Registrar duly executed by the registered owner or his or her
duly authorized attorney. Upon surrender of a Series 2024 Bond for registration of transfer, the
City shall execute,the Trustee shall authenticate,and the Bond Registrar shall deliver, in the name
of the transferee, one or more new Series 2024 Bonds of the same aggregate principal amount and
of the same maturity as the Series 2024 Bond surrendered.
Series 2024 Bonds may be exchanged, at the option of the registered owner, for an equal
aggregate principal amount of Series 2024 Bonds of the same maturity of any other Authorized
Denominations, upon surrender of those Series 2024 Bonds at the office of the Bond Registrar
with a written instrument of transfer satisfactory to the Bond Registrar duly executed by the
registered owner or his or her duly authorized attorney.
In all cases in which the privilege of exchanging or transferring Series 2024 Bonds is
exercised, the City shall execute, the Trustee shall authenticate, and the Bond Registrar shall
deliver, Series 2024 Bonds in accordance with the provisions of this Indenture. All Series 2024
Bonds surrendered in any exchange or transfer shall be canceled immediately by the Bond
Registrar.
For every exchange or registration of transfer of Series 2024 Bonds, the City or the Bond
Registrar may make a charge sufficient to reimburse it for any tax, fee or other governmental
charge, other than one imposed by the City, required to be paid with respect to that exchange or
registration of transfer, and payment of that charge by the person requesting exchange or
registration of transfer shall be a condition precedent to that exchange or registration of transfer.
No other charge may be made by the City or the Bond Registrar as a condition precedent to
exchange or registration of transfer of any Series 2024 Bond.
The Bond Registrar shall not be required to exchange or register the transfer of any Series
2024 Bond following the close of business on the 1 5th day of the month preceding any Interest
Payment Date on such Series 2024 Bond, nor to transfer or exchange any Series 2024 Bond after
notice calling such Series 2024 Bond for redemption has been mailed, nor during a period of 15
days next preceding mailing of a notice of redemption of any Series 2024 Bonds.
The City, the Trustee and the Bond Registrar may treat the registered owner of any Series
2024 Bond as its absolute owner,whether or not that Series 2024 Bond is overdue,for the purpose
of receiving payment of the principal of or interest on that Series 2024 Bond and for all other
purposes, and neither the City, the Bond Registrar nor the Trustee shall be affected by any notice
to the contrary. Payment of the principal of and interest on each Series 2024 Bond shall be made
only to its registered owner, and all such payments shall be valid and effective to satisfy the
obligation of the City on that Series 2024 Bond to the extent of the amount paid.
Section 2.10 Global Form; Securities Depository. It is intended that the Series 2024
Bonds be registered so as to participate in a securities depository system with DTC, as set forth
herein.The Series 2024 Bonds shall be initially issued in the form of a single fully registered Series
2024 Bond for each of the maturities as established in Section 2.4 of this Indenture. Upon initial
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issuance, the ownership of the Series 2024 Bonds shall be registered in the name of Cede & Co.,
or any successor thereto, as nominee for DTC. The City and the Trustee are authorized to execute
and deliver such letters to or agreements with DTC as shall be necessary to effectuate the securities
depository system of DTC, including the Letter of Representations. With respect to Series 2024
Bonds registered in the name of Cede&Co.,as nominee of DTC,the City,the Bond Registrar and
the Trustee shall have no responsibility or obligation to any broker-dealer, bank or other financial
institution for which DTC holds Series 2024 Bonds from time to time as securities depository
(each such broker-dealer, bank or other financial institution being referred to herein as a
"Depository Participant")or to any person on behalf of whom such a Depository Participant holds
an interest in the Series 2024 Bonds (each such person being herein referred to as an "Indirect
Participant"). Without limiting the immediately preceding sentence,the City, the Bond Registrar
and the Trustee shall have no responsibility or obligation with respect to (a) the accuracy of the
records of DTC, Cede& Co., or any Depository Participant with respect to the ownership interest
in the Series 2024 Bonds, (b)the delivery to any Depository Participant or any Indirect Participant
or any other person,other than a registered owner of a Series 2024 Bond,of any notice with respect
to the Series 2024 Bonds, including any notice of redemption or(c)the payment to any Depository
Participant or Indirect Participant or any other person, other than a registered owner of a Series
2024 Bond, of any amount with respect to principal of, premium, if any, or interest on, the Series
2024 Bonds. While in the securities depository system of DTC, no person other than Cede & Co.,
or any successor thereto, as nominee for DTC, shall receive a Series 2024 Bond certificate with
respect to any Series 2024 Bond. Upon delivery by DTC to the Trustee of written notice to the
effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject
to the provisions of this Indenture with respect to the payment of interest by the mailing of checks
or drafts to the registered owners of Series 2024 Bonds at the close of business on the record date
applicable to any interest payment date, the name "Cede & Co." in this Indenture shall refer to
such new nominee of DTC.
In the event that (a) the City determines that DTC is incapable of discharging its
responsibilities described herein and in the Letter of Representations, (b) the Letter of
Representations shall be terminated for any reason or (c) the City determines that it is in the best
interests of the Beneficial Owners of the Series 2024 Bonds that they be able to obtain certificated
Series 2024 Bonds,the City shall notify DTC of the availability through DTC of Series 2024 Bond
certificates and the Series 2024 Bonds shall no longer be restricted to being registered in the name
of Cede & Co., as nominee of DTC. At that time, the City may determine that the Series 2024
Bonds shall be registered in the name of and deposited with a successor depository operating a
securities depository system, as may be acceptable to the City or such depository's agent or
designee, and if the City does not select such alternate securities depository system then the Series
2024 Bonds may be registered in whatever name or names registered owners of Bonds transferring
or exchanging Series 2024 Bonds shall designate, in accordance with the provisions hereof.
Notwithstanding any other provisions of this Indenture to the contrary, so long as any
Series 2024 Bond is registered in the name of Cede& Co., as nominee of DTC, all payments with
respect to principal of,premium, if any,and interest on the Series 2024 Bonds and all notices with
respect to the Series 2024 Bonds shall be made and given, respectively, in the manner provided in
the Letter of Representations.
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Section 2.11 Additional Bonds. Only the Series 2024 Bonds will be issued under this
Indenture. No additional bonds will be issued that are secured by a pledge of the Special Taxes
other than bonds or other obligations issued for the purpose of refunding all or a portion of the
Series 2024 Bonds.
ARTICLE 3
REDEMPTION OF SERIES 2024 BONDS
Section 3.1 Mandatory Sinking Fund Redemption. The Series 2024 Bonds maturing on
March 1, 20 are subject to mandatory redemption by operation of the provisions of this
Section 3.1 and Section 3.5 from amounts on deposit in the Bond and Interest Fund, in part and
randomly, at the Redemption Price equal to the principal amount thereof to be redeemed,without
Bond Premium, on March 1 of the years and in the amounts as follows:
Redemption Date Principal
March 1 Amount
The City covenants that it will redeem the Series 2024 Bonds pursuant to the mandatory
sinking fund redemption requirements for the Series 2024 Bonds to the extent amounts are on
deposit in the Bond and Interest Fund. Proper provision for mandatory redemption having been
made, the City covenants that the Series 2024 Bonds so selected for redemption shall be payable
upon redemption and taxes have been levied and will be collected as provided herein and in the
Bond Ordinance for such purposes.
Section 3.2 Optional Redemption. The Series 2024 Bonds maturing on and after March
1, 20 are subject to optional redemption prior to maturity at the option of the City, in whole
or in part, on any date on or after March 1, , at a redemption price of par plus accrued and
unpaid interest to the date of redemption.
Any optional redemption of Series 2024 Bonds in part shall be applied, to the extent
possible, to reduce pro rata the amount of Series 2024 Bonds maturing or required to be redeemed
by mandatory sinking fund redemption pursuant to Section 3.1 of this Indenture, and so as to
maintain the proportion of principal maturing or subject to mandatory sinking fund redemption in
each year to the total original principal amount of Series 2024 Bonds.
Section 3.3 Mandatory Redemption upon Condemnation . The Series 2024 Bonds, are
subject to mandatory redemption on any Interest Payment Date, in part, at a redemption price
equal to the principal amount to be redeemed, together with accrued interest to the date fixed for
redemption, without premium, from amounts in the Bond and Interest Fund consisting of the
proceeds received by the City in connection with a condemnation of any of the Special Services
or any other property dedicated to, or owned by, the City within the Special Service Area and
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allocable to the Series 2024 Bonds as determined by the Consultant and which proceeds are not
used by the City to rebuild the Special Services.
Any mandatory redemption of the Series 2024 Bonds pursuant to this Section 3.3 shall be
applied, to the extent possible, to reduce pro rata the amount of Series 2024 Bonds maturing or
required to be redeemed by mandatory sinking fund redemption pursuant to Section 3.1 of this
Indenture and so as to maintain the proportion of principal maturing or subject to mandatory
sinking fund redemption in each year to the total original principal amount of the Series 2024
Bonds.
Section 3.4 Special Mandatory Redemption from Optional Prepayment of Special Tax.
The Series 2024 Bonds are also subject to mandatory redemption on any March 1, June 1,
September 1, or December 1, in part, from optional prepayments of the Special Taxes from
amounts available for disbursement from the Special Redemption Account pursuant to Section
6.1(d) and from amounts transferred from the Special Reserve Fund and the Reserve Fund to the
Special Redemption Account pursuant to Section 6.1(d), at a redemption price (expressed as a
percentage of the principal amount of the Series 2024 Bonds to be redeemed), as set forth below,
together with accrued interest on such Series 2024 Bonds to the date fixed for redemption:
Redemption
Redemption Dates Prices
On or prior to 102%
101
100
Any special mandatory redemption of the Series 2024 Bonds pursuant to this Section 3.4
shall be applied, to the extent possible, to reduce pro rata the amount of Series 2024 Bonds
maturing or required to be redeemed by mandatory sinking fund redemption pursuant to Section
3.1 of the Indenture and so as to maintain the proportion of principal maturing or subject to
mandatory sinking fund redemption in each year to the total original principal amount of Series
2024 Bonds.
Section 3.5 Redemption Provisions; Notice of Redemption. If less than all the Series
2024 Bonds of any maturity are to be redeemed on any redemption date,by mandatory or optional
redemption, written notice shall be given in writing to the Trustee at least 45 days prior to the
redemption date from the City or the Consultant.Notice shall include the pro-rata breakdown for
any such redemption. The Bond Registrar appointed in this Indenture shall assign to each Series
2024 Bond of the maturity to be redeemed a distinctive number for each $1,000 of principal
amount of that Series 2024 Bond. The Bond Registrar shall then select by lot from the numbers so
assigned,using such method as it shall deem proper in its discretion,as many numbers as,at$1,000
per number,shall equal the principal amount of Series 2024 Bonds of that maturity to be redeemed;
provided that following any redemption, no Series 2024 Bond shall be outstanding in an amount
less than the minimum Authorized Denomination except (a) as necessary to effect the mandatory
sinking fund redemption of Series 2024 Bonds as provided in Section 3.1 hereof or(b)to effect a
special mandatory redemption from optional prepayments when the total aggregate principal
amount of Bonds outstanding is $5,000 or less.
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Notice of the redemption of any Series 2024 Bonds,which by their terms shall have become
subject to redemption, shall be given to the registered owner of each Series 2024 Bond or portion
of a Series 2024 Bond called for redemption not less than 30 or more than 60 days before any date
established for redemption of Series 2024 Bonds, by the Bond Registrar, on behalf of the City, by
first class mail sent to the registered owner's last address, if any, appearing on the registration
books kept by the Bond Registrar. All notices of redemption shall include at least the designation,
date and maturities of Series 2024 Bonds called for redemption, CUSIP Numbers, if available, and
the date of redemption. In the case of a Series 2024 Bond to be redeemed in part only, the notice
shall also specify the portion of the principal amount of the Series 2024 Bond to be redeemed. The
mailing of the notice specified above to the registered owner of any Series 2024 Bond shall be a
condition precedent to the redemption of that Series 2024 Bond, provided that any notice which is
mailed in accordance with this Indenture shall be conclusively presumed to have been duly given
whether or not the owner received the notice. The failure to mail notice to the owner of any Series
2024 Bond, or any defect in that notice, shall not affect the validity of the redemption of any other
Series 2024 Bond for which notice was properly given.
With respect to an optional redemption of any Series 2024 Bonds,unless moneys sufficient
to pay the principal of, redemption premium, if any, and interest on the Series 2024 Bonds to be
redeemed shall have been received by the Trustee prior to the giving of such notice of redemption,
such notice may, at the option of the City, state that said redemption shall be conditional upon the
receipt of such moneys by the Trustee on or prior to the date fixed for redemption. If such moneys
are not received, such notice shall be of no force and effect, the City shall not redeem such Series
2024 Bonds and the Trustee shall give notice, in the same manner in which the notice of
redemption was given, that such moneys were not so received and that such Series 2024 Bonds
will not be redeemed.
Section 3.6 Purchase in Lieu of Redemption. In lieu of redemption as provided in this
Article 3, moneys in the Bond and Interest Fund may be used and withdrawn by the City, subject
to the prior written consent of the Bond Insurer,for the purchase of outstanding Series 2024 Bonds,
at public or private sale as and when, and at such prices (including brokerage and other charges)
as the City may provide, but in no event may Series 2024 Bonds be purchased at a price in excess
of the principal amount of such Series 2024 Bonds, plus interest accrued to the date of purchase
and any premium which would otherwise be due if such Series 2024 Bonds were to be redeemed
in accordance with this Indenture.
ARTICLE 4
APPLICATION OF PROCEEDS AND OTHER AMOUNTS
Section 4.1 Application of Proceeds. The proceeds of the sale of the Series 2024 Bonds
in the amount of $ , which is net of underwriter's discount in the amount of
$ plus original issue premium in the amount of$ , shall be applied as
follows immediately upon receipt of the purchase price:
(1) The amount of$ shall be transferred to the Prior Bond Trustee,
to be deposited into the Bond and Interest Fund for such Prior Bonds and used, together
with any other funds on deposit therein, to currently refund all of the Outstanding Prior
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Bonds at a Redemption Price equal to 100% of the principal amount of Prior Bonds to be
redeemed, plus all accrued interest thereon to the , 2024 redemption date.
(2) The amount of$ shall be deposited into the Reserve Fund.
(3) The amount of$ shall be deposited into the Costs of Issuance
Account of the Administrative Expense Fund.
(4) The amount of$ shall be paid to the Bond Insurer from the Costs
of Issuance Fund, for the premium owed for the Bond Insurance Policy.
(5) The amount of$ shall be paid to the Bond Insurer from the Costs
of Issuance Fund, for the premium owed for the Reserve Policy.
All amounts received upon the sale of the Series 2024 Bonds,together with all interest and
other investment earnings on those amounts, are appropriated and set aside for the purposes for
which the Series 2024 Bonds are being issued as set forth in this Indenture.
Section 4.2 Amounts Held for Prior Bonds. The City and the Trustee shall cause the
Prior Bond Trustee to (a) transfer all amounts held by the Prior Bond Trustee in the Prior Bonds
Administrative Expense Fund as follows: (i) the amount of$15,000 shall be deposited into the
Special Reserve Fund, and (ii) all remaining amounts held by the Prior Bond Trustee in the Prior
Bonds Administrative Expense Fund shall be deposited into the Administrative Expense Fund to
be used to pay Administrative Expenses, and(b)transfer and deposit all amounts held by the Prior
Bond Trustee into the Bond and Interest Fund for the Prior Bonds to be applied to pay the
redemption price of the Prior Bonds to be redeemed on , 2024. Any additional Special
Taxes collected from the levy for the Prior Bonds shall be deposited into the Bond and Interest
Fund for the Series 2024 Bonds and applied in accordance with Section 6.1 hereof.
ARTICLE 5
SECURITY FOR THE SERIES 2024 BONDS
Section 5.1 Limited Obligations. The Series 2024 Bonds shall constitute limited
obligations of the City, payable from the Special Taxes and other moneys deposited in the Funds
and Accounts established pursuant to Article 6 other than the Administrative Expense Fund, the
Special Reserve Fund and the Rebate Fund. The Series 2024 Bonds shall not constitute general
obligations of the City and neither the full faith and credit nor the unlimited taxing power of the
City shall be pledged as security for payment of the Series 2024 Bonds.
Section 5.2 Levy of Special Tax. Pursuant to the Bond Ordinance there has been levied
a Special Tax upon all taxable real property within the Special Service Area subject to the Special
Taxes sufficient to pay and discharge the principal of the Series 2024 Bonds at maturity or
mandatory sinking fund redemption dates and to pay interest on the Series 2024 Bonds for each
year at the interest rates set forth in Section 2.4 of this Indenture and to pay estimated
Administrative Expenses of the City for each year, to replenish the Reserve Fund to an amount
equal to the Reserve Requirement (or to restore the amount available under any Reserve Fund
Surety Policy, together with cash on deposit in the Reserve Fund, to the Reserve Requirement),
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and to fund and replenish the Special Reserve Fund to an amount equal to the Special Reserve
Fund Requirement.
(a) The City Clerk has been directed to file a certified copy of the Bond
Ordinance with the County Clerk of Kendall County. The Special Taxes shall be computed,
extended and collected in accordance with the Special Tax Roll and Report and the Special Tax
Roll, and divided among the taxable real property within the Special Service Area in accordance
with the terms of the Establishing Ordinance and the Special Tax Roll and Report. It shall be the
duty of the City and the City hereby covenants,annually on or before the last Tuesday of December
for each of the years 2024 through 2033 to calculate or cause the Consultant to calculate the Special
Tax Requirement;to amend the Special Tax Roll pursuant to Section VI E of the Special Tax Roll
and Report and provide the County tax collector with the amended Special Tax Roll; and to adopt
an ordinance approving the amount of the current calendar year's Special Tax Requirement and
abating the Special Taxes levied pursuant to the Bond Ordinance to the extent the taxes levied
pursuant to the Bond Ordinance exceed the Special Tax Requirement as calculated by the City
pursuant to the Establishing Ordinance and the Special Tax Roll and Report. On or before the last
Tuesday of January for each of the years 2025 through 2034 the City shall notify the Trustee of
the amount of the Special Tax Requirement and the amount of the Special Taxes to be abated. The
City shall take all actions which shall be necessary to provide for the levy, extension, collection
and application of the taxes levied by the Bond Ordinance, including enforcement of such taxes
by providing the County with such information as is deemed necessary to enable the County to
include any property subject to a delinquent Special Tax in the County Collector's annual tax sale
and as further provided in Section 7.2(c) hereof; and in the event the tax lien is forfeited at such
tax sale upon request of any Bond Insurer or a majority of the Bondholders by instituting
proceedings, including assigning to the Trustee its right to purchase as a taxing district the unpaid
taxes due upon the property all in the manner provided by law; provided, however, that the
obligation to purchase unpaid taxes, or institute any proceeding shall only arise in the event the
City makes the determination that sufficient funds are on deposit in the Administrative Expense
Fund to (i)pay all remaining Administrative Expenses expected for such levy year, and (ii) apply
to the purchase of the unpaid taxes and/or pay the costs of any proceeding.
(b) Upon receipt by the Trustee of any prepayment of Special Tax in an amount
calculated by the Consultant as being required pursuant to the Special Tax Roll and Report to
satisfy the lien on a Parcel within the Special Service Area,the City and the Trustee shall execute
a Satisfaction of Tax Lien substantially in the form of Exhibit C hereto, appropriately completed
and the Trustee shall deliver the Satisfaction of Tax Lien to the City for filing with the Recorder
of Deeds of Kendall County, Illinois. The City shall deliver a copy of each such Satisfaction of
Tax Lien to the property owner of record and a copy of the recorded Satisfaction of Tax Lien to
the Trustee.
Section 5.3 Bond Insurance Policy; Covenants in Favor of Bond Insurer.
(a) Payment Procedure Under the Bond Insurance Policy.
(1) In the event that principal and/or interest due on the Series 2024 Bonds shall
be paid bythe Bond Insurer pursuant to the Bond Insurance Policy,the Series 2024 Bonds
shall remain outstanding for all purposes, not be defeased or otherwise satisfied and not be
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considered paid by the City,the assignment and pledge of the trust estate and all covenants,
agreements and other obligations of the City to the registered owners shall continue to exist
and shall run to the benefit of the Bond Insurer, and the Bond Insurer shall be subrogated
to the rights of such registered owners.
(2) In the event that, on the second Business Day prior to the payment date on
the Series 2024 Bonds, the Trustee has not received sufficient moneys to pay all principal
of and interest on the Series 2024 Bonds due on the second following Business Day, the
Trustee shall immediately notify the Bond Insurer or its designee on the same Business
Day by telephone or electronic mail, of the amount of the deficiency. If any deficiency is
made up in whole or in part prior to or on the payment date, the Trustee shall so notify the
Bond Insurer or its designee.
(3) In addition, if a Responsible Officer of the Trustee has received written
notice that any Bondholder has been required to disgorge payments or principal or interest
on the Series 2024 Bonds pursuant to a final,non-appealable order by a court of competent
jurisdiction that such payment constitutes a voidable preference to such Bondholder within
the meaning of any applicable bankruptcy law, then the Trustee shall notify the Bond
Insurer or its designee of such fact by telephone or electronic mail,or by overnight or other
delivery service as to which a delivery receipt is signed by a person authorized to accept
delivery on behalf of the Bond Insurer.
(4) The Trustee is hereby irrevocably designated, appointed, directed and
authorized to act as attorney-in-fact for the holders of the Series 2024 Bonds as follows:
(I) If there is a deficiency in amounts required to pay interest and/or
principal on the Series 2024 Bonds,the Trustee shall (A)execute and deliver to the
Bond Insurer, in form satisfactory to the Bond Insurer, an instrument appointing
the Bond Insurer as agent and attorney-in-fact for such holders of the Series 2024
Bonds in any legal proceeding related to the payment and assignment to the Bond
Insurer of the claims for interest on the Series 2024 Bonds,(B)receive as designee
of the respective holders (and not as Paying Agent) in accordance with the tenor of
the Bond Insurance Policy payment from the Bond Insurer with respect to the
claims for interest so assigned, (C) segregate all such payments in a separate
account (the "Bond Insurer Policy Payment Account") to only be used to make
scheduled payments of principal of and interest on the Series 2024 Bond, and (D)
disburse the same to such respective holders.
(ii) If and to the extent there is a deficiency in amounts required to pay
principal of the Series 2024 Bonds,the Trustee shall (A) execute and deliver to the
Bond Insurer, in form satisfactory to the Bond Insurer, an instrument appointing
the Bond Insurer as agent and attorney-in-fact for such holder of the Series 2024
Bonds in any legal proceeding related to the payment of such principal and an
assignment to the Bond Insurer of the Series 2024 Bonds surrendered to the Bond
Insurer, (B)receive as designee of the respective holders(and not as Paying Agent)
in accordance with the tenor of the Bond Insurance Policy payment therefore from
the Bond Insurer, (C) segregate all such payments in the Bond Insurer Policy
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Payment Account to only be used to make scheduled payments of principal of and
interest on the Series 2024 Bond, and (D) disburse the same to such holders.
The Trustee shall designate any portion of payment of principal on Series 2024 Bonds paid
by the Bond Insurer, whether by virtue of mandatory sinking fund redemption, maturity or other
advancement of maturity, on its books as a reduction in the principal amount of Series 2024 Bonds
registered to the then current holder, whether DTC or its nominee or otherwise, and shall issue a
replacement Series 2024 Bond to the Bond Insurer, registered in the name directed by the Bond
Insurer,in a principal amount equal to the amount of principal so paid(without regard to authorized
denominations); provided that the Trustee's failure to so designate any payment or issue any
replacement Series 2024 Bond shall have no effect on the amount of principal or interest payable
by the City on any Series 2024 Bond or the subrogation or assignment rights of the Bond Insurer.
(5) Payments with respect to claims for interest on and principal of Series 2024
Bonds disbursed by the Trustee from proceeds of the Bond Insurance Policy shall not be
considered to discharge the obligation of the City with respect to such Series 2024 Bonds
and the Bond Insurer shall become the owner of such unpaid Series 2024 Bonds and claims
for the interest in accordance with the tenor of the assignment made to it under the
provisions of the preceding paragraphs or otherwise. The Security Documents shall not be
discharged or terminated unless all amounts due or to become due to the Bond Insurer have
been paid in full or duly provided for.
Irrespective of whether any such assignment is executed and delivered, the City and the
Trustee agree for the benefit of the Bond Insurer that:
(1) They recognize that to the extent the Bond Insurer makes payments directly
or indirectly(e.g., by paying through the Paying Agent or Trustee), on account of principal
of or interest on the Series 2024 Bonds, the Bond Insurer will be subrogated to the rights
of such holders to receive the amount of such principal and interest from the City, with
interest thereon, as provided and solely from the sources stated in the Security Documents
and the Series 2024 Bonds; and
(2) They will accordingly pay to the Bond Insurer the amount of such principal
and interest, with interest thereon as provided in the Security Documents and the Series
2024 Bonds, but only from the sources and in the manner provided therein for the payment
of principal of and interest on the Series 2024 Bonds to holders, and will otherwise treat
the Bond Insurer as the owner of such rights to the amount of such principal and interest
(b) Additional Payments. The City hereby agrees to pay or reimburse the Bond
Insurer to the extent permitted by law and solely from the Special Tax and amounts available under
this Indenture, any and all reasonable charges, fees, costs and expenses which the Bond Insurer
may pay or incur, including, but not limited to, fees and expenses of the Bond Insurer's agents,
attorneys, accountants,consultants, appraisers and auditors and reasonable costs of investigations,
in connection with the administration (including waivers and consents, if any), enforcement,
defense, exercise or preservation of any rights and remedies in respect of the Security Documents
("Administrative Costs"). The City agrees that failure to pay any Administrative Costs from the
Special Tax on a timely basis will result in the accrual of interest on the unpaid amount at the Late
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Payment Rate, compounded semi-annually, from the date that payment is first due to the Bond
Insurer until the date the Bond Insurer is paid in full.
Notwithstanding anything herein to the contrary,the City agrees to pay to the Bond Insurer
to the extent permitted by law and solely from the Special Tax and Trust Estate (i)a sum equal to
the total of all amounts paid by the Bond Insurer under the Bond Insurance Policy (the "Bond
Insurer Policy Payment");and(ii) interest on the Bond Insurer Policy Payments from the date paid
by the Bond Insurer until payment thereof in full by the City, payable to the Bond Insurer at the
Late Payment Rate per annum (collectively, the "Bond Insurer Reimbursement Amounts")
compounded semi-annually. Notwithstanding anything to the contrary, including without
limitation the post default application of revenue provisions, the Bond Insurer Reimbursement
Amounts shall be, and the City hereby covenants and agrees that the Bond Insurer Reimbursement
Amounts are, payable from and secured by a lien on and pledge of the same revenues and other
collateral pledged to the Series 2024 Bonds on a parity with debt service due on the Series 2024
Bonds.
(c) Notice and Other Information. The City will provide the Bond Insurer with
all notices and other information it is obligated to provide (i) under its Continuing Disclosure
Agreement and (ii) to the holders of the Series 2024 Bonds or the Trustee under the Security
Documents.
The notice address of the Bond Insurer is:
, Attention: , Re: Policy No. , Telephone:
, Telecopier: , Email: . In each case in which notice
or other communication refers to an event of default or a claim on the Bond Insurance Policy,then
a copy of such notice or other communication shall also be sent to the attention of the General
Counsel at the same address and at or at Telecopier:
and shall be marked to indicate "URGENT MATERIAL ENCLOSED."
(d) Defeasance. The investments in the defeasance escrow relating to the
Series 2024 Bonds shall be limited to non-callable, direct obligations of the United States of
America and securities fully and unconditionally guaranteed as to the timely payment of principal
and interest by the United States of America, or as otherwise maybe authorized under State law
and approved by the Bond Insurer.
At least (three) 3 Business Days prior to any defeasance with respect to the Series 2024
Bonds other than a cash defeasance of 30 days or less, the City shall deliver to the Bond Insurer
draft copies of an escrow agreement, an opinion of bond counsel regarding the validity and
enforceability of the escrow agreement and the defeasance of the Series 2024 Bonds,a verification
report(a"Verification Report")prepared by a nationally recognized independent financial analyst
or firm of certified public accountants regarding the sufficiency of the escrow fund. Such opinion
and Verification Report shall be addressed to the Bond Insurer and shall be in form and substance
satisfactory to the Bond Insurer. In addition, any escrow agreement shall provide that:
(1) Any substitution of securities following the execution and delivery of the
escrow agreement shall require the delivery of a Verification Report, an opinion of bond
counsel that such substitution will not adversely affect the exclusion from gross income of
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the holders of the Series 2024 Bonds of the interest on the Series 2024 Bonds for federal
income tax purposes and the prior written consent of the Bond Insurer,which consent will
not be unreasonably withheld.
(2) The City will not exercise any prior optional redemption of the Series 2024
Bonds secured by the escrow agreement or any other redemption other than mandatory
sinking fund redemptions unless (i) the right to make any such redemption has been
expressly reserved in the escrow agreement and such reservation has been disclosed in
detail in the official statement, if any, for the refunding bonds, and (ii) as a condition to
any such redemption there shall be provided to the Bond Insurer a Verification Report as
to the sufficiency of escrow receipts without reinvestment to meet the escrow requirements
remaining following any such redemption.
(3) The City shall not amend the escrow agreement or enter into a forward
purchase agreement or other agreement with respect to rights in the escrow without the
prior written consent of the Bond Insurer.
(e) Trustee and Paying Agent.
(1) The Bond Insurer shall receive written notice of any name change of the
Trustee, any Paying Agent for the Series 2024 Bonds or the resignation or removal of the
Trustee or, if applicable, the Paying Agent. Any Trustee must be (A) a national banking
association that is supervised by the Office of the Comptroller of the Currency and has at
least $250 million of assets, (B)a state-chartered commercial bank that is a member of the
Federal Reserve System and has at least $1 billion of assets, or(C) otherwise approved by
the Bond Insurer in writing.
(2) No removal, resignation or termination of the Trustee or, if applicable, the
Paying Agent shall take effect until a successor, meeting the requirements above, or
acceptable to the Bond Insurer, shall be qualified and appointed.
(f) Amendments, Supplements and Consents. The Bond Insurer's prior written
consent is required for all amendments and supplements to the Security Documents, with the
exceptions noted below. The City shall send copies of any such amendments or supplements to
the Bond Insurer and the rating agencies which have assigned a rating to the Series 2024 Bonds.
(1) Consent of the Bond Insurer. Any amendments or supplements to the
Security Documents shall require the prior written consent of the Bond Insurer with the
exception of amendments or supplements:
(i) To cure any ambiguity or formal defect or omissions or to correct
any inconsistent provisions in the transaction documents or in any supplement
thereto,
(ii) To grant or confer upon the holders of the Series 2024 Bonds any
additional rights, remedies, powers, authority or security that may lawfully be
granted to or conferred upon the holders of the Series 2024 Bonds, or
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(iii) To add to the conditions, limitations and restrictions on the issuance
of bonds or other obligations under the provisions of the Security Documents other
conditions, limitations and restrictions thereafter to be observed, or
(iv) To add to the covenants and agreements of the City in the Security
Documents other covenants and agreements thereafter to be observed by the City
or to surrender any right or power therein reserved to or conferred upon the City.
(v) To issue additional parity debt in accordance with the requirements
set forth in the Security Documents.
(2) Consent of the Bond Insurer in Addition to Bondholder Consent. Any
amendment,supplement,modification to,or waiver of,any of the Security Documents that
requires the consent of holders of the Series 2024 Bonds or adversely affects the rights or
interests of the Bond Insurer shall be subject to the prior written consent of the Bond
Insurer.
(3) Insolvency. Any reorganization or liquidation plan with respect to the City
must be acceptable to the Bond Insurer. The Trustee and each owner of the Series 2024
Bonds hereby appoint the Bond Insurer as their agent and attorney-in-fact with respect to
the Series 2024 Bonds and agree that the Bond Insurer may at any time during the
continuation of any proceeding by or against the City under the United States Bankruptcy
Code or any other applicable bankruptcy, insolvency,receivership, rehabilitation or similar
law(an"Insolvency Proceeding")direct all matters relating to such Insolvency Proceeding,
including without limitation, (A) all matters relating to any claim or enforcement
proceeding in connection with an Insolvency Proceeding (a"Claim"), (B) the direction of
any appeal of any order relating to any Claim, (C) the posting of any surety, supersedeas
or performance bond pending any such appeal, and (D)the right to vote to accept or reject
any plan of adjustment. In addition, the Trustee and each owner of the Series 2024 Bonds
delegate and assign to the Bond Insurer,to the fullest extent permitted by law,the rights of
the Trustee and each owner of the Series 2024 Bonds with respect to the Series 2024 Bonds
in the conduct of any Insolvency Proceeding, including, without limitation, all rights of
any party to an adversary proceeding or action with respect to any court order issued in
connection with any such Insolvency Proceeding.
(4) Control by the Bond Insurer Upon Default. Anything in the Security
Documents to the contrary notwithstanding, upon the occurrence and continuance of a
default or an Event of Default under this Indenture, the Bond Insurer shall be entitled to
control and direct the enforcement of all rights and remedies granted to the holders of the
Series 2024 Bonds or the Trustee or Paying Agent for the benefit of the holders of the
Series 2024 Bonds under any Security Document. No default or Event of Default may be
waived without the Bond Insurer's written consent.
(5) The Bond Insurer as Owner. Upon the occurrence and continuance of a
default or an Event of Default, the Bond Insurer shall be deemed to be the sole owner of
the Series 2024 Bonds for all purposes under the Security Documents, including, without
limitations, for purposes of exercising remedies and approving amendments.
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(6) Grace Period for Payment Defaults. No grace period shall be permitted for
payment defaults on the Series 2024 Bonds. No grace period for a covenant default shall
exceed 30 days without the prior written consent of the Bond Insurer.
(7) Special Provisions for Insurer Default. If an Insurer Default shall occur and
be continuing, then, notwithstanding anything in paragraphs (f)(1)-(5) above to the
contrary, (1) if at any time prior to or following an Insurer Default, the Bond Insurer has
made payment under the Bond Insurance Policy, to the extent of such payment the Bond
Insurer shall be treated like any other holder of the Series 2024 Bonds for all purposes,
including giving of consents, and (2) if the Bond Insurer has not made any payment under
the Bond Insurance Policy, the Bond Insurer shall have no further consent rights until the
particular Insurer Default is no longer continuing or the Bond Insurer makes a payment
under the Bond Insurance Policy, in which event, the foregoing clause (1) shall control.
For purposes of this paragraph, "Insurer Default" means: (A) the Bond Insurer has failed
to make any payment under the Bond Insurance Policy when due and owing in accordance
with its terms; or (B) the Bond Insurer shall (i) voluntarily commence any proceeding or
file any petition seeking relief under the United States Bankruptcy Code or any other
Federal,state or foreign bankruptcy, insolvency or similar law,(ii)consent to the institution
of or fail to controvert in a timely and appropriate manner, any such proceeding or the
filing of any such petition, (iii) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator or similar official for such party or for a substantial part of
its property, (iv)file an answer admitting the material allegations of a petition filed against
it in any such proceeding, (v)make a general assignment for the benefit of creditors,or(vi)
take action for the purpose of effecting any of the foregoing; or (C) any state or federal
agency or instrumentality shall order the suspension of payments on the Bond Insurance
Policy or shall obtain an order or grant approval for the rehabilitation, liquidation,
conservation or dissolution of the Bond Insurer (including without limitation under the
New York Insurance Law).
(g) The Bond Insurer As Third Party Beneficiary. The Bond Insurer is
recognized as and shall be deemed to be a third party beneficiary of the Security Documents and
may enforce the provisions of the Security Documents as if it were a party thereto.
(h) The Reserve Fund. The prior written consent of the Bond Insurer shall be a
condition precedent to the deposit of any credit instrument provided in lieu of a cash deposit into
the Reserve Fund. Amounts on deposit in the Reserve Fund shall be applied solely to the payment
of debt service due on the Series 2024 Bonds.
(i) Exercise of Rights by the Bond Insurer. The rights granted to the Bond
Insurer under the Security Documents to request, consent to or direct any action are rights granted
to the Bond Insurer in consideration of its issuance of the Bond Insurance Policy. Any exercise by
the Bond Insurer of such rights is merely an exercise of the Bond Insurer's contractual rights and
shall not be construed or deemed to be taken for the benefit, or on behalf, of the holders of the
Series 2024 Bonds and such action does not evidence any position of the Bond Insurer,affirmative
or negative, as to whether the consent of the holders of the Series 2024 Bonds or any other person
is required in addition to the consent of the Bond Insurer.
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The Bond Insurer shall be entitled to pay principal or interest on the Series 2024 Bonds
that shall become Due for Payment but shall be unpaid by reason of Nonpayment by the Issuer(as
such terms are defined in the Bond Insurance Policy),whether or not the Bond Insurer has received
a claim upon the Bond Insurance Policy.
No contract shall be entered into or any action taken by which the rights of the Bond Insurer
or security for or source of payment of the Series 2024 Bonds may be impaired or prejudiced in
any material respect except upon obtaining the prior written consent of the Bond Insurer.
Section 5.4 Provisions Relating to Reserve Policy. The City hereby represents,
warrants and covenants, and the Trustee hereby covenants, as follows, and agrees that the
provisions of this Section 8.8 shall govern, notwithstanding anything to the contrary set forth in
this Indenture:
(a) The City shall repay any draws under the Reserve Policy and pay all related reasonable
expenses incurred by the Bond Insurer and shall pay interest thereon from the date of
payment by the Bond Insurer at the Late Payment Rate. If the interest provisions of this
subparagraph (a) shall result in an effective rate of interest which, for any period, exceeds
the limit of the usury or any other laws applicable to the indebtedness created herein, then
all sums in excess of those lawfully collectible as interest for the period in question shall,
without further agreement or notice between or by any party hereto, be applied as additional
interest for any later periods of time when amounts are outstanding hereunder to the extent
that interest otherwise due hereunder for such periods plus such additional interest would
not exceed the limit of the usury or such other laws, and any excess shall be applied upon
principal immediately upon receipt of such moneys by the Bond Insurer,with the same force
and effect as if the City had specifically designated such extra sums to be so applied and the
Bond Insurer had agreed to accept such extra payment(s)as additional interest for such later
periods. In no event shall any agreed-to or actual exaction as consideration for the
indebtedness created herein exceed the limits imposed or provided by the law applicable to
this transaction for the use or detention of money or for forbearance in seeking its collection.
Repayment of draws and payment of expenses and accrued interest thereon at the
Late Payment Rate(collectively,"Reserve Policy Costs") shall commence in the first month
following each draw, and each such monthly payment shall be in an amount at least equal to
1/12 of the aggregate of Reserve Policy Costs related to such draw.
Amounts in respect of Reserve Policy Costs paid to the Bond Insurer shall be
credited first to interest due, then to the expenses due and then to principal due. As and to
the extent that payments are made to the Bond Insurer on account of principal due, the
coverage under the Reserve Policy will be increased by a like amount, subject to the terms
of the Reserve Policy.The obligation to pay Reserve Policy Costs shall be secured by a valid
lien on all revenues and other collateral pledged as security for the Series 2024 Bonds
(subject only to the priority of payment provisions set forth under this Indenture).
All cash and investments in the Reserve Fund shall be transferred to the debt service
fund for payment of debt service on the Series 2024 Bonds before any drawing may be made
on the Reserve Policy or any other Reserve Fund Surety Policy credited to the Reserve Fund
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in lieu of cash. Payment of any Reserve Policy Costs shall be made prior to replenishment
of any such cash amounts. Draws on all Reserve Fund Surety Policies(including the Reserve
Policy)on which there is available coverage shall be made on a pro-rata basis(calculated by
reference to the coverage then available thereunder) after applying all available cash and
investments in the Reserve Fund. Payment of Reserve Policy Costs and reimbursement of
amounts with respect to other Reserve Fund Surety Policies shall be made on a pro-rata basis
prior to replenishment of any cash drawn from the Reserve Fund. For the avoidance of doubt,
"available coverage" means the coverage then available for disbursement pursuant to the
terms of the applicable Reserve Fund Surety Policy without regard to the legal or financial
ability or willingness of the provider of such instrument to honor a claim or draw thereon or
the failure of such provider to honor any such claim or draw.
(b) If the City shall fail to pay any Reserve Policy Costs in accordance with the requirements of
subparagraph (a) hereof, the Bond Insurer shall be entitled to exercise any and all legal and
equitable remedies available to it, including those provided under this Indenture other than
(i) acceleration of the maturity of the Series 2024 Bonds or (ii) remedies which would
adversely affect owners of the Series 2024 Bonds.
(c) This Indenture shall not be discharged until all Reserve Policy Costs owing to the Bond
Insurer shall have been paid in full. The City's obligation to pay such amounts shall
expressly survive payment in full of the Series 2024 Bonds.
The Trustee shall ascertain the necessity for a claim upon the Reserve Policy in accordance
with the provisions of subparagraph (a) hereof and to provide notice to the Bond Insurer in
accordance with the terms of the Reserve Policy at least five (5) Business Days prior to each date
upon which interest or principal is due on the Series 2024 Bonds. Where deposits are required to
be made by the City with the Trustee to the Reserve Fund more often than semi-annually, the
Trustee shall be instructed to give notice to the Bond Insurer of any failure of the City to make
timely payment in full of such deposits within two (2) Business Days of the date due.
ARTICLE 6
FUNDS AND ACCOUNTS
Section 6.1 Bond and Interest Fund.
(a) There is hereby created and established with the Trustee a separate and
special fund of the City established exclusively for paying principal of, interest on and redemption
premium on the Series 2024 Bonds and which shall be designated as the "Special Service Area
Number 2004-107 Special Tax Refunding Bonds Bond and Interest Fund"(the"Bond and Interest
Fund"). Upon receipt by the Trustee, the Special Taxes and the Foreclosure Proceeds, including
any interest and penalties collected in connection with such Special Tax or Foreclosure Proceeds
shall be placed in the Bond and Interest Fund. The City may provide for the County to transmit
directly to the Trustee for deposit to the Bond and Interest Fund any Special Tax collected by the
County. In addition, proceeds received by the City in connection with a condemnation of any of
the Special Services or any other property owned by or dedicated to the City within the Special
Service Area and allocable to the Series 2024 Bonds as determined by the Consultant which are
not used to rebuild the Special Services shall be deposited in the Bond and Interest Fund. Moneys
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deposited in the Bond and Interest Fund and investments of the Bond and Interest Fund shall never
be commingled with or loaned to any other funds of the City. All interest and other investment
earnings on the Bond and Interest Fund shall become, when received, a part of the Bond and
Interest Fund. When the amount of condemnation proceeds deposited to the Bond and Interest
Fund equals $1,000 or more, such amount shall be used to redeem Series 2024 Bonds pursuant to
Section 3.3 of this Indenture on the next Interest Payment Date. Any amounts representing
condemnation proceeds which remain on deposit in the Bond and Interest Fund for a continuous
period of thirty (30) months and which will not be used to redeem the Series 2024 Bonds on the
next Interest Payment Date in accordance with Section 3.3 and this section shall be used to pay
debt service on the Series 2024 Bonds on the next Interest Payment Date.
(b) Amounts deposited in the Bond and Interest Fund are appropriated for and
irrevocably pledged to, and shall be used solely for the purpose of, paying the principal of and
interest and redemption premium on the Series 2024 Bonds, or for transfers to the Reserve Fund,
the Special Reserve Fund or the Administrative Expense Fund as permitted by paragraph (c) of
this Section 6.1 and by Section 6.2.
(c) At any time after September 1 but in no event later than December 1 of each
year,the Trustee shall determine the amount needed to pay principal of and interest and redemption
premium on the Series 2024 Bonds on March 1 of the next succeeding year. After the Trustee has
determined that sufficient amounts are on deposit in the Bond and Interest Fund to pay principal
of, interest on and redemption premium due on the Series 2024 Bonds on the next March 1, the
Trustee shall notify the City and the Consultant of any excess amounts on deposit in the Bond and
Interest Fund, and, at the written direction of the City, shall transfer an amount from the Bond and
Interest Fund to the Administrative Expense Fund which the City after consultation with the
Consultant has determined will be adequate, together with other amounts in the Administrative
Expense Fund or reasonably expected to be transferred to or deposited in such Fund, to pay all
Administrative Expenses during the succeeding calendar year. After making such transfer to the
Administrative Expense Fund any excess amounts on deposit in the Bond and Interest Fund shall
be transferred to the Reserve Fund to the extent necessary to replenish the Reserve Fund to the
Reserve Requirement (or to restore the amount available under any Reserve Fund Surety Policy,
together with cash on deposit in the Reserve Fund, to the Reserve Requirement). After(i) making
such transfer to the Administrative Expense Fund, and (ii) the Reserve Fund has amounts on
deposit equal to the Reserve Requirement,any excess amounts on deposit in the Bond and Interest
Fund shall be transferred to the Special Reserve Fund to the extent necessary to fund the Special
Reserve Fund to the Special Reserve Fund Requirement. The total amount transferred from time
to time to the Special Reserve Fund shall not exceed [$25,000] giving consideration to amounts
that may have previously been transferred from the Special Reserve Fund. Thereafter any
remaining excess shall be retained in the Bond and Interest Fund and applied to pay principal and
interest coming due on the next succeeding Interest Payment Date.
(d) There is hereby created within the Bond and Interest Fund established with
the Trustee a separate account designated the "Special Redemption Account." Amounts deposited
in the Special Redemption Account shall be applied to the redemption of the Series 2024 Bonds
pursuant to Section 3.3(b) or Section 3.4 of this Indenture. All prepayments of Special Tax made
in accordance with the Special Tax Roll and Report shall be deposited in the Special Redemption
Account. Moneys in the Special Redemption Account shall be used exclusively to redeem Series
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2024 Bonds pursuant to Section 3.3(b) or Section 3.4 or to pay debt service on the Series 2024
Bonds pursuant to this Section 6.1. In the event of any optional prepayment of Special Tax pursuant
to Section 3.4, prior to giving notice of the redemption of Series 2024 Bonds in accordance with
Section 3.5 of this Indenture, the Trustee shall transfer from the Reserve Fund to the Special
Redemption Account an amount equal to the Reserve Fund Credit and from the Special Reserve
Fund (to the extent funds are available) to the Special Redemption Account an amount equal to
the Special Reserve Fund Credit, if any, upon the direction of the Consultant in accordance with
the Special Tax Roll and Report. When the amount on deposit in the Special Redemption Account
from amounts deposited pursuant to Section 3.3 equals or exceeds $1,000, such amount shall be
used to redeem the Series 2024 Bonds on the next Interest Payment Date in accordance with
Section 3.3. On each such Interest Payment Date, the Trustee shall withdraw from the Special
Redemption Account and pay to the owners of the Series 2024 Bonds the amounts to redeem the
Series 2024 Bonds pursuant to Section 3.3(b). When the amount on deposit in the Special
Redemption Account from amounts deposited pursuant to Section 3.4 equals or exceeds $1,000,
such amount shall be used to redeem the Series 2024 Bonds on the next March 1,June 1, September
1 or December 1 in accordance with Section 3.4. On each such redemption date, the Trustee shall
withdraw from the Special Redemption Account and pay to the owners of the Series 2024 Bonds
the amounts to redeem the Series 2024 Bonds pursuant to Section 3.4. Notwithstanding the
foregoing, any amounts contained in the Special Redemption Account for a continuous period of
thirty(30)months and which will not be used to redeem the Series 2024 Bonds in accordance with
the two immediately preceding sentences shall be used to pay debt service on the Series 2024
Bonds on the next Interest Payment Date. Any amounts contained in the Special Redemption
Account on the final maturity date of the Series 2024 Bonds shall be used to pay outstanding debt
service on the Series 2024 Bonds.
Section 6.2 Reserve Fund. There is hereby created and established with the Trustee a
separate and special fund of the City which shall be designated as the "Special Service Area
Number 2004-107 Special Tax Refunding Bonds, Reserve Fund" (the "Reserve Fund"), which
must be maintained in an amount equal to the Reserve Requirement. The Reserve Requirement
shall be an amount equal to $ as reduced by Reserve Fund Credits in connection with
prepayments pursuant to Section 6.1(d). The Reserve Requirement shall be satisfied by the deposit
into the Reserve Fund of(i) cash in the amount of$ transferred by the Prior Bonds
Trustee from the Reserve Fund under the Indenture relating to the Prior Bonds,and(ii)the Reserve
Policy in the amount of$ . The City may at any time and from time to time substitute
cash, a Reserve Fund Surety Policy or any combination thereof for either of the foregoing then on
deposit in the Reserve Fund, and, thereupon, the Trustee shall release all or a portion of such cash
or Reserve Fund Surety Policy and shall cause such excess to be deposited into the Bond and
Interest Account and used for the payment of interest on the Series 2024 Bonds on the next
following Interest Payment Date, so long as the combination of the foregoing remaining in the
Reserve Fund following such release shall equal the Reserve Requirement.
Amounts deposited in the Reserve Fund (including drawings under any Reserve Fund
Surety Policy) shall be used solely for the purpose of(i) making transfers to the Bond and Interest
Fund to pay the principal of, including mandatory sinking fund payments, and interest and any
premium on, all Series 2024 Bonds when due, in the event that moneys in the Bond and Interest
Fund are insufficient therefor without further direction from the City, (ii) making any transfers to
the Bond and Interest Fund if the balance in the Reserve Fund and the Special Reserve Fund
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exceeds the amount required to redeem all Series 2024 Bonds then outstanding, (iii) making
transfers to the Special Redemption Account in an amount equal to any Reserve Fund Credit in
the event of an optional prepayment of the Special Tax as provided in Section 6.1(d) of this
Indenture,or(iv) if the amount then on deposit in the Reserve Fund is at least equal to the Reserve
Requirement, for transfer in accordance with the next paragraph.
On the Business Day prior to each September 1 Interest Payment Date, (a) moneys in the
Reserve Fund in excess of the Reserve Requirement shall be transferred by the Trustee from the
Reserve Fund to the Bond and Interest Fund to be used for the payment of interest on the Series
2024 Bonds on such September 1 Interest Payment Date, and (b) moneys in the Reserve Fund in
excess of(i) the Reserve Requirement and (ii) the interest due on the Series 2024 Bonds on such
September 1 Interest Payment Date, shall be used for the payment of principal on the Series 2024
Bonds on the next following March 1 Interest Payment Date.
On the Business Day prior to each March 1 Interest Payment Date, (a) moneys in the
Reserve Fund in excess of the Reserve Requirement shall be transferred by the Trustee from the
Reserve Fund to the Bond and Interest Fund to be used for the payment of principal of and interest
and redemption premium (if any) on the Series 2024 Bonds on such March 1 Interest Payment
Date, and (b) moneys in the Reserve Fund in excess of(i) the Reserve Requirement and (ii) the
principal of and interest and redemption premium (if any) due on the Series 2024 Bonds on such
March 1 Interest Payment Date, shall be used for the payment of interest on the Series 2024 Bonds
on the next following September 1 Interest Payment Date. Any amounts contained in the Reserve
Fund on the final maturity date of the Series 2024 Bonds shall be transferred to the Bond and
Interest Fund, and used to pay outstanding debt service on the Series 2024 Bonds.
Withdrawals from the Reserve Fund shall be made from the following sources in the
following order of priority: (1) cash, and(2) from drawings under a Reserve Fund Surety Policy in
the order of priority provided for in such instruments. Any replenishment of the Reserve Fund
hereunder shall be applied first to the reimbursement of drawings under a Reserve Fund Surety
Policy and then to the restoration of cash.
In the event that the City chooses to deposit a Reserve Fund Surety Policy into the Reserve
Fund, it may make reasonable covenants and agreements with the issuer of the policy, surety or
other facility including, but not limited to, covenants and agreements related to the following:
(a) The application and priority of amounts deposited to the credit of
the Reserve Fund after a draw under the Reserve Fund Surety Policy to reimburse
the issuer of the Reserve Fund Surety Policy or to reimburse or replenish cash in
the Reserve Fund;
(b) Not less than fifteen(15)days advance notice of the need for a draw
by the Trustee under the Reserve Fund Surety Policy and to maintain records; and
(c) The status of the issuer of the Reserve Fund Surety Policy as a third
party beneficiary under this Indenture and its ability to enforce the provisions of
this Indenture to the extent such rights may in fact benefit such issuer of the policy
or facility.
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Section 6.3 Special Reserve Fund. There is hereby created and established with the
Trustee a separate and special fund of the City which shall be designated as the "Special Service
Area Number 2004-107 Special Tax Refunding Bonds, Special Reserve Fund" (the "Special
Reserve Fund"). Special Taxes shall be deposited in the Special Reserve Fund in accordance with
Section 6.1 until the amounts on deposit in the Special Reserve Fund equal the Special Reserve
Fund Requirement. The total amount transferred from time to time to the Special Reserve Fund
shall not exceed [$25,000] giving consideration to amounts that may have previously been
transferred from the Special Reserve Fund.
Amounts deposited in the Special Reserve Fund shall be used solely for the purpose of(i)
making any transfers to the Bond and Interest Fund if the aggregate balance in the Special Reserve
Fund and the Reserve Fund exceeds the amount required to redeem all Series 2024 Bonds then
outstanding, (ii) for transfer to the Special Redemption Account in an amount equal to the Special
Reserve Fund Credit in accordance with Section 6.1(d), (iii)on [March 1, ] for transfer to the
Bond and Interest Fund as described below, (iv) at the direction of an Authorized Officer for
transfer to the Bond and Interest Fund or any other fund established hereunder, or (v) at the
direction of an Authorized Officer for any use permitted by the Special Service Area Act,provided
an opinion of bond counsel is delivered to the Trustee to the effect that such use will not violate
the Special Service Area Act or adversely affect the tax-exempt status of interest on the Series
2024 Bonds.
On [March 1, ] (on which date the Special Reserve Fund Credit shall be zero), the
Trustee shall without further direction, transfer any remaining amounts on deposit in the Special
Reserve Fund to the Bond and Interest Fund to pay principal of and interest and redemption
premium on the Series 2024 Bonds on the next succeeding Interest Payment Date.
Any amounts in the Special Reserve Fund that are used to pay principal of, or interest or
premium on, the Series 2024 Bonds shall be treated as Special Taxes paid by the owners of the
affected Parcels for purposes of the Special Tax Roll and Report.
Amounts on deposit in the Special Reserve Fund are not pledged to the payment of
principal of or interest on the Series 2024 Bonds.
Section 6.4 Administrative Expense Fund. There is hereby created and established with
the Trustee a separate and special fund of the City which shall be designated as the"Special Service
Area Number 2004-107 Special Tax Refunding Bonds, Administrative Expense Fund" (the
"Administrative Expense Fund"). Amounts in the Administrative Expense Fund shall be
withdrawn by the Trustee and paid to the City or its order upon receipt by the Trustee of a written
request from an Authorized Officer stating the amount to be withdrawn,that such amount is to be
used to pay an Administrative Expense, and the nature of such Administrative Expense.
There is hereby created within the Administrative Expense Fund established with the
Trustee a separate account designated the "Costs of Issuance Account". Amounts deposited into
the Cost of Issuance Account shall be used solely for the purpose of paying costs incurred in
connection with the issuance of the Series 2024 Bonds (including, without limitation, the
premiums for any Bond Insurance Policy and Reserve Fund Surety Policy). Disbursement from
the Costs of Issuance Account shall be made by the Trustee upon receipt of a Written Request
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from the City in the form of Exhibit D which shall(i)set forth the amount required to be disbursed,
the purpose for which the disbursement is to be made,that the disbursement is a proper expenditure
from the Costs of Issuance Account, and payment instructions to the Trustee for the amount to be
disbursed and (ii) certify that no portion of the amount then being requested to be disbursed was
set forth in any previous request for disbursement. On the date which is six months after the date
of issuance of the Series 2024 Bonds,the Trustee will transfer all amounts remaining in the Costs
of Issuance Account to the Administrative Expense Fund.
Section 6.5 Rebate Fund. There is hereby created and established with the Trustee a
separate and special fund of the City which shall be designated as the "Special Service Area
Number 2004-107 Special Tax Refunding Bonds, Rebate Fund" (the "Rebate Fund"), into which
there shall be deposited as necessary investment earnings in the Bond and Interest Fund, the
Reserve Fund and the Special Reserve Fund to the extent required so as to maintain the tax-exempt
status of interest on the Series 2024 Bonds all at the direction of the City. All rebates, special
impositions or taxes for such purpose payable to the United States of America (Internal Revenue
Service) shall be payable from the Rebate Fund at the direction of the City.
Section 6.6 Investment of Funds. Moneys on deposit in Funds and Accounts
established hereunder may be invested from time to time in Qualified Investments pursuant to and
solely at the direction of the City to the Trustee provided that moneys on deposit in the Special
Redemption Account shall be invested in Qualified Investments having a maturity of 180 days or
less. Except as otherwise expressly provided herein, earnings or losses on such investments shall
be attributed to the Fund or Account for which the investment was made. In the event that the
Trustee does not receive directions from the City to invest funds held hereunder, the Trustee shall
invest such funds in a money market fund which invests in short-term securities issued or
guaranteed by the United States Government, its agencies or instrumentalities. The Trustee is
hereby authorized to execute purchases and sales of Qualified Investments through the facilities
of its own trading or capital markets operations or those of any affiliated entity.
The Trustee shall send statements to the City and the Consultant on a monthly basis
reflecting activity in the funds and accounts established pursuant to this Indenture for the preceding
month as required by Section 9.9 of this Indenture. Although the City recognizes that it may obtain
a broker confirmation or written statement containing comparable information at no additional
cost, the City hereby agrees that confirmations of Qualified Investments are not required to be
issued by the Trustee for each month in which a monthly statement is rendered.
Notwithstanding anything herein to the contrary, at the written direction of the City the
Trustee shall invest amounts on deposit in the (1) Special Redemption Account of the Bond and
Interest Fund and (2) the Special Reserve Fund such that the yield on the investment does not
exceed the yield on the Series 2024 Bonds. The Reserve Fund shall be invested only in Qualified
Investments with maturities not longer than ten (10) years, the average life of which is no longer
than five (5) years. Investments on deposit in all funds and accounts established hereunder shall
be valued at market value at least quarterly.
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ARTICLE 7
COVENANTS AND AGREEMENTS OF THE CITY
Section 7.1 Tax Covenants.
(a) The City covenants with the holders of the Series 2024 Bonds from time to
time outstanding that it (i) will take all actions which are necessary to be taken (and avoid any
actions which it is necessary to avoid being taken) so that interest on the Series 2024 Bonds will
not be or become included in gross income for federal income tax purposes under existing law,
including without limitation the Code; (ii)will take all actions reasonably within its power to take
which are necessary to be taken (and avoid taking any actions which are reasonably within its
power to avoid taking and which are necessary to avoid) so that interest on the Series 2024 Bonds
will not be or become included in gross income for federal income tax purposes under the federal
income tax laws as in effect from time to time; and(iii)will take no action or permit any action in
the investment of the proceeds of the Series 2024 Bonds, amounts in the Bond and Interest Fund
or any other funds of the City which would result in making interest on the Series 2024 Bonds
subject to federal income taxes by reason of causing the Series 2024 Bonds to be"arbitrage bonds"
within the meaning of Section 148 of the Code,or direct or permit any action inconsistent with the
regulations under the Code as promulgated and as amended from time to time and as applicable to
the Series 2024 Bonds. The Mayor, City Clerk and City Treasurer are authorized and directed to
take such action as is necessary in order to carry out the issuance and delivery of the Series 2024
Bonds including, without limitation, to make any representations and certifications they deem
proper pertaining to the use of the proceeds of the Series 2024 Bonds and moneys in the Funds
and Accounts established hereunder in order to establish that the Series 2024 Bonds shall not
constitute arbitrage bonds as so defined.
(b) The City further covenants as follows with respect to the requirements of
Section 148(f) of the Code, relating to the rebate of "excess arbitrage profits" (the "Rebate
Requirement")to the United States:
(I) Unless an applicable exception to the Rebate Requirement is
available to the City, the City will meet the Rebate Requirement.
(ii) Relating to applicable exceptions,the City shall make such elections
under the Code as it shall deem reasonable and in the best interests of the City.
(iii) The City shall, not less frequently than annually, cause a rebate
report to be prepared and delivered to the Trustee and upon receipt of such report
cause the Trustee to transfer to the Rebate Fund the amount determined to be the
accrued liability under the Rebate Requirement from other funds held pursuant to
this Indenture. The City shall cause to be paid to the United States, without further
order or direction from the Corporate Authorities, from time to time as required,
amounts sufficient to meet the Rebate Requirement.
(iv) Interest earnings in the Bond and Interest Fund and the Reserve
Fund are hereby authorized to be transferred, upon written direction from an
Authorized Officer, from time to time as required, to the Rebate Fund for the
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purposes herein provided; and proceeds of the Series 2024 Bonds, investment
earnings or amounts on deposit in any of the other funds and accounts created
hereunder and any other Fund of the City are also hereby authorized to be used to
meet the Rebate Requirement, but only if necessary after application of investment
earnings as aforesaid and only as appropriated and directed by the Corporate
Authorities.
Section 7.2 Levy and Collection of Taxes. The City covenants with the holders of the
Series 2024 Bonds from time to time outstanding that:
(a) it will take all actions, if any, which shall be necessary, in order further to
provide for the levy, extension,collection and application of the taxes levied by this Indenture and
the Bond Ordinance including enforcement of the Special Taxes as described in clause (c) below;
(b) it will not take any action which would adversely affect the levy, extension,
collection and application of the taxes levied by this Indenture and the Bond Ordinance, except to
abate those taxes to the extent permitted by this Indenture and the Special Tax Roll and Report;
(c) it will comply with all requirements of the Special Service Area Act, the
Bond Ordinance and other applicable present and future laws concerning the levy, extension and
collection of the taxes levied by this Indenture and the Bond Ordinance; in each case so that the
City shall be able to pay the principal of and interest on the Series 2024 Bonds as they come due,
replenish the Special Reserve Fund to the Special Reserve Requirement and the Reserve Fund to
the Reserve Requirement (or to restore the amount available under any Reserve Fund Surety
Policy, together with cash on deposit in the Reserve Fund, to the Reserve Requirement), and will
take all actions necessary to assure the timely collection of the Special Taxes, including without
limitation, the enforcement of any delinquent Special Tax by providing the County with such
information as is deemed necessary to enable the County to include any property subject to a
delinquent Special Tax in the County Collector's annual tax sale and upon receipt of the written
request of the Bond Insurer or a majority of the Bondholders in the event the tax lien is forfeited
at such tax sale, by assigning to the Trustee its right to institute foreclosure proceedings, and/or
assigning to the Trustee its right to purchase as a taxing district the unpaid taxes due upon the
property all in the manner provided by law; provided, however, that the obligation to purchase
unpaid taxes, or institute any proceeding shall only arise in the event the City or the Trustee, as
applicable, makes the determination that sufficient funds are on deposit in the Administrative
Expense Fund to (i) pay all remaining Administrative Expenses expected for such levy year, and
(ii)apply to the purchase of the unpaid taxes and/or pay the costs of any proceeding;
(d) in the event the City approves any change in the plats of subdivision for the
Special Service Area which changes the density of either of the Special Service Area or otherwise
becomes aware of a change in density, it shall provide prompt written notice to the Consultant of
such fact and the circumstances resulting in the change in density; and
(e) to the extent possible, it will direct Kendall County to deposit all Special
Taxes when collected including Foreclosure Proceeds, condemnation proceeds and prepayments
directly with the Trustee to be applied as set forth herein.
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Section 7.3 Proper Books and Records. The City will keep, or cause the Trustee to
keep, proper books of record and accounts, separate from all other records and accounts of the
City, in which complete and correct entries shall be made of all transactions relating to the deposits
to and expenditure of amounts disbursed from the Funds and Accounts created hereunder and the
Special Taxes. Such books of record and accounts shall at all times during business hours be
subject to the inspection of the holders of not less than ten percent (10%) of the principal amount
of the Series 2024 Bonds then outstanding,or their representatives authorized in writing. The City,
or the Trustee on behalf of the City, upon written request will mail to the Purchaser and the Bond
Insurer any information relating to the Series 2024 Bonds,the Special Service Area or the Special
Services, including, but not limited to, the annual audits of the Funds and Accounts established
under this Indenture for each and every year.
Section 7.4 Against Encumbrances. The City will not encumber, pledge or place any
charge or lien upon any of the Special Taxes or other amounts pledged to the Series 2024 Bonds
superior to,on a parity with,or junior to,the pledge and lien created in this Indenture for the benefit
of the Series 2024 Bonds, except as permitted by, or specifically set forth in,this Indenture.
Section 7.5 Continuing Disclosure Undertaking. The reports, statements and other
documents required to be furnished to or by the Trustee pursuant to any provisions of this Indenture
shall be available to the Purchaser and the Trustee shall submit to the Municipal Securities
Rulemaking Board (the "MSRB") through the Electronic Municipal Market Access System
("EMMA") all information as required pursuant to the Continuing Disclosure Agreement.
ARTICLE 8
DEFAULTS AND REMEDIES
Section 8.1 Events of Default. "Events of Default" under this Indenture are as follows:
(a) Default shall be made by the City in the payment of the principal of or
premium, if any, on any Series 2024 Bond when and as the same shall become due and payable,
either at maturity or by proceedings for redemption or otherwise.
(b) Default shall be made by the City in the payment of any installment of
interest on any Series 2024 Bond when and as such installment of interest shall become due and
payable.
(c) The City shall(1)commence a voluntary case under the Federal bankruptcy
laws, as now or hereafter constituted, or any other applicable Federal or state bankruptcy,
insolvency or other similar law, (2)make an assignment for the benefit of its creditors,(3)consent
to the appointment of a receiver of itself or of the whole or any substantial part of its property, or
(4) be adjudicated a bankrupt or have entered against it any order for relief in respect of any
involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or state bankruptcy, insolvency or other similar law and such order shall
continue in effect for a period of 60 days without stay or vacation.
(d) A court of competent jurisdiction shall enter an order,judgment or decree
appointing a receiver of the City, or of the whole or any substantial part of its property, or
approving a petition seeking reorganization of the City under the Federal bankruptcy laws or any
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other applicable Federal or state law or statute and such order,judgment or decree shall not be
vacated or set aside or stayed within 60 days from the date of the entry thereof.
(e) Under the provisions of any other law for the relief or aid of debtors, any
court of competent jurisdiction shall assume custody or control of the City or of the whole or any
substantial part of its property,and such custody or control shall not be terminated or stayed within
60 days from the date of assumption of such custody or control.
(f) The City shall default in the due and punctual performance of any other of
the covenants, conditions, agreements and provisions contained in the Series 2024 Bonds, the
Bond Ordinance or in this Indenture on the part of the City to be performed, and such default shall
continue for 30 days after written notice specifying such default and requiring the same to be
remedied shall have been given to the City by the Trustee (which may give such notice whenever
it reasonably determines that such a default exists and shall give such notice at the written request
of the holders of not less than 25%in principal amount of the Series 2024 Bonds then outstanding).
Section 8.2 Remedies. Upon the occurrence of an Event of Default the Trustee may,
and upon the written request of the Bond Insurer or the holders of 25% in principal amount of the
outstanding Series 2024 Bonds affected (with the consent of the Bond Insurer) by the Event of
Default and upon being indemnified as provided in Section 9.2(h) hereof shall, proceed to protect
and enforce its rights and the rights of the holders of the Series 2024 Bonds by a suit, action or
special proceeding in equity or at law, by mandamus or otherwise, either for the specific
performance of any covenant or agreement contained herein or in aid or execution of any power
herein granted or for any enforcement of any proper legal or equitable remedy as the Trustee,being
advised by counsel, shall deem most effective to protect and enforce the rights aforesaid.
During the continuance of an Event of Default, all moneys received by the Trustee under
this Indenture from the City or from any other source shall be applied by the Trustee in accordance
with the terms of Section 8.10 hereof.
Any judgment against the City shall be enforceable only against the amounts pledged
pursuant to this Indenture. There shall not be authorized any deficiency judgment against any
assets of, or the general credit of,the City, its officers or employees or independent contractors.
The Series 2024 Bonds shall not be subject to acceleration upon the occurrence of an
Event of Default.
Section 8.3 Notice of Default. The Trustee shall, within 10 days after the Trustee
receives notice or obtains knowledge of the occurrence of an Event of Default, mail to the City,
and the Bondholders at the address shown on the registration books of the City maintained by the
Bond Registrar, notice of all Events of Default known to the Trustee unless such Events of Default
shall have been cured before the giving of such notice.
Section 8.4 Termination of Proceedings by Trustee. In case any proceedings taken by
the Trustee on account of any Event of Default shall have been discontinued or abandoned for any
reason, or shall have been determined adversely to the Trustee, then and in every such case the
City, the Trustee and the Bondholders shall be restored to their former positions and rights
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hereunder,respectively,and all rights,remedies and powers of the Trustee shall continue as though
no such proceeding had been taken.
Section 8.5 Right of Bondholders to Control Proceedings. Anything in this Indenture
to the contrary notwithstanding, the Bond Insurer or, if the Bond Insurer has defaulted on any
payments required by the Bond Insurance Policy, the holders of a majority in principal amount of
the Series 2024 Bonds then outstanding shall have the right, by an instrument in writing executed
and delivered to the Trustee,to direct the method and place of conducting all remedial proceedings
to be taken by the Trustee hereunder in respect of the Series 2024 Bonds; provided that such
direction shall not be otherwise than in accordance with law and the Trustee shall be indemnified
to its satisfaction against the costs, expenses and liabilities to be incurred therein or thereby.
Section 8.6 Right of Bondholders to Institute Suit. No holder of any of the Series 2024
Bonds shall have any right to institute any suit, action or proceeding in equity or at law for the
execution of any trust hereunder, or for any other remedy hereunder or on the Series 2024 Bonds
unless such holder previously shall have given to the Trustee written notice of an Event of Default
as hereinabove provided, and unless also the Bond Insurer or the holder, or holders, of 25% in
principal amount of the outstanding Series 2024 Bonds affected (with the consent of the Bond
Insurer) by the Event of Default shall have made written request of the Trustee after the right to
exercise such powers, or right of action, as the case may be, shall have accrued, and shall have
afforded the Trustee a reasonable opportunity either to proceed to exercise the powers hereinbefore
granted, or to institute such action, suit, or proceeding in its name; and unless, also, there shall
have been offered to the Trustee security and indemnity satisfactory to it against the costs,expenses
and liabilities to be incurred therein or thereby, and the Trustee shall have refused or neglected to
comply with such request within a reasonable time; and such notification, request and offer of
indemnity are hereby declared in every such case, at the option of the Trustee, to be conditions
precedent to the execution of the powers and trusts of this Indenture or for any other remedy
hereunder; it being understood and intended that no one or more holders of the Series 2024 Bonds
shall have any right in any manner whatever by his or their action to affect, disturb or prejudice
the security of this Indenture, or to enforce any right hereunder, except in the manner herein
provided, and that all proceedings at law or in equity shall be instituted, had and maintained in the
manner herein provided and for the equal benefit of all holders of the outstanding Series 2024
Bonds.
Nothing in this Section 8.6 contained shall, however, affect or impair the right of any
Bondholder, which is absolute and unconditional, to enforce the payment of the principal of and
interest on the Bondholder's Series 2024 Bonds out of the Bond and Interest Fund,or the obligation
of the City to pay the same, out of the Bond and Interest Fund, at the time and place in the Series
2024 Bonds expressed.
Section 8.7 Suits by Trustee. All rights of action under this Indenture, or under any of
the Series 2024 Bonds, enforceable by the Trustee, may be enforced by it without the possession
of any of the Series 2024 Bonds or the production thereof at the trial or other proceeding relative
thereto, and any such suit, or proceeding, instituted by the Trustee shall be brought in its name for
the ratable benefit of the holders of the Series 2024 Bonds affected by such suit or proceeding,
subject to the provisions of this Indenture.
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Section 8.8 Remedies Cumulative. No remedy herein conferred upon or reserved to the
Trustee or to the Bondholders is intended to be exclusive of any other remedy or remedies, and
each and every remedy shall be cumulative, and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute.
Section 8.9 Waiver of Default. No delay or omission of the Trustee or of any
Bondholder to exercise any right or power shall be construed to be a waiver of any such default,
or an acquiescence therein; and every power and remedy given by this Article 8 to the Trustee and
the Bondholders,respectively,may be exercised from time to time,and as often as may be deemed
expedient.
Section 8.10 Application of Moneys After Default. The City covenants that if an Event
of Default shall happen and shall not have been remedied, the Trustee shall apply moneys,
securities and funds on deposit in the Funds and Accounts established pursuant to Article 6 or
received by the Trustee pursuant to any right given or action taken under the provisions of this
Section as follows and in the following order:
(a) To the payment of the reasonable and proper fees, charges, expenses and
liabilities of the Trustee,the Bond Registrar and any paying agent, including the fees and expenses
of outside counsel for the Trustee, Bond Registrar and any paying agent and the payment of
Administrative Expenses owed to the City or the Consultant.
(b) To the payment of the principal and interest then due on the Series 2024
Bonds as follows:
(i) first,to the payment to the persons entitled thereto of all interest then
due or payable on the Series 2024 Bonds in the order of the maturity of such
installments;
(ii) second, to the payment to the persons entitled thereto of the unpaid
installments of principal of any of the Series 2024 Bonds which have become due
in the order of the maturity of such installments; and
(iii) third, to the payment of amounts due and payable to the Bond
Insurer, not paid pursuant to (i) and (ii) above.
Whenever moneys are to be applied by the Trustee pursuant to the provisions of this paragraph,
such moneys shall be applied by the Trustee at such times, and from time to time, as the Trustee
in its sole discretion shall determine, having due regard for the amount of such moneys available
for application and the likelihood of additional moneys becoming available for such application in
the future. The deposit of such moneys with the paying agent, or otherwise setting aside such
moneys, in trust for the proper purpose, shall constitute proper application by the Trustee; and the
Trustee shall incur no liability whatsoever to the City, to any Bondholder or to any other person
for any delay in applying any such funds, so long as the Trustee acts with reasonable diligence,
having due regard to the circumstances, and ultimately applies the same in accordance with such
provisions of this Indenture as may be applicable at the time of application by the Trustee.
Whenever the Trustee shall exercise such discretion in applying such funds, it shall fix the date
(which shall be an Interest Payment Date unless the Trustee shall deem another date more suitable)
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upon which such application is to be made and upon such date interest on the amounts of principal
paid on such date shall cease to accrue. The Trustee shall give such notice as it may deem
appropriate of the fixing of any such date and of the endorsement to be entered on each Series
2024 Bond on which payment shall be made, and shall not be required to make payment to the
holder of any unpaid Series 2024 Bond until such Series 2024 Bond shall be presented to the
Trustee for appropriate endorsement,or some other procedure deemed satisfactory by the Trustee.
Section 8.11 Bond Insurer Control. Anything in this Indenture to the contrary
notwithstanding, upon the occurrence and continuance of an Event of Default as defined herein,
the Bond Insurer shall be entitled to control and direct the enforcement of all rights and remedies
granted to the Bondholders,or the Trustee for the benefit of the Bondholders, under this Indenture
provided the Bond Insurer has not defaulted on any payments required by the terms of the Bond
Insurance Policy. The Bond Insurer also shall be entitled to approve all waivers of Events of
Default provided the Bond Insurer has not defaulted on any payments required by the terms of the
Bond Insurance Policy.
ARTICLE 9
TRUSTEE
Section 9.1 Appointment of the Trustee. The Trustee hereunder is hereby constituted
and appointed as the trustee of an express trust hereby created for the Bondholders. The further
rights and duties of the Trustee are set forth in this Article 9.
Section 9.2 Performance of Duties. The Trustee shall perform such duties and only
such duties as are specifically set forth in this Indenture, using such care as a corporate trustee
ordinarily would use in performing trusts under a corporate indenture or trust or depositary
agreement.
No provision of this Indenture shall be construed to relieve the Trustee from liability for
its own negligent action, its own negligent failure to act or its own willful misconduct, except that:
(a) The duties and obligations of the Trustee shall be determined solely by the
express provisions of this Indenture, and the Trustee shall not be liable except for the performance
of such duties and obligations as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the Trustee.
(b) In the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the opinions expressed
therein, upon any certificate or opinion furnished to the Trustee conforming to the requirements of
this Indenture; but in the case of any such certificate or opinion which by any provision hereof is
specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine
the same to determine whether or not it conforms to the requirements of this Indenture.
(c) The Trustee shall not be liable with respect to any action taken or omitted
to be taken by it in good faith in accordance with the direction of the Bond Insurer or the holders
of not less than a majority (or such other percentage as is otherwise specifically required by the
terms hereof) in aggregate principal amount of all the Series 2024 Bonds at the time outstanding
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other than actions taken or omitted by the Trustee which are adjudicated to have resulted from the
negligence of the Trustee.
(d) None of the provisions contained in this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur individual financial liability in the exercise of
any of its rights or powers.
(e) At any and all reasonable times, upon first providing 48 hours' notice to the
City, the Trustee, and its duly authorized agents, attorneys, experts, engineers, accountants and
representatives, shall have the right fully to inspect any and all of the books, papers and records of
the City pertaining to the Special Services and the Series 2024 Bonds,and to copy such memoranda
from and in regard thereto as may be desired.
(f) The Trustee shall not be required to give any bond or surety in respect of
the execution of the trusts and powers granted by this Indenture or otherwise in respect of the
premises.
(g) Notwithstanding anything elsewhere in this Indenture contained, the
Trustee shall have the right, but shall not be required, to demand, in respect of the withdrawal of
any cash or any action whatsoever within the purview of this Indenture,any showings,certificates,
opinions, appraisals or other information or corporate action or evidence thereof, in addition to
that by the terms hereof required as a condition of such action by the Trustee,reasonably necessary
to establish the right of the City to the withdrawal of any cash or the taking of any other action by
the Trustee.
(h) Before taking any action under Section 8.2, the Trustee may require that a
satisfactory indemnity bond or other security satisfactory to it be furnished by the party requesting
that the Trustee take such action for the reimbursement of all expenses to which it may be put and
to protect it against all liability, except liability which is adjudicated to have resulted from the
negligence or willful default of the Trustee in connection with any action so taken or failure to act
in accordance with this Indenture.
(i) All moneys received by the Trustee or any paying agent shall, until used or
applied or invested as herein provided, be held in trust for the purposes for which they were
received.
Section 9.3 Instruments Upon Which Trustee May Rely. Except as otherwise provided
in paragraph (b) hereof:
(a) The Trustee may rely and shall be protected in acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent, order, bond or other
paper or document reasonably believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(b) Any notice, request, direction, election, order or demand of the City
mentioned herein shall be sufficiently evidenced by an instrument signed in the name of the City
by an Authorized Officer (unless other evidence in respect thereof be herein specifically
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prescribed); and any resolution of the Corporate Authorities may be evidenced to the Trustee by a
copy thereof certified by the City Clerk under the City seal;
(c) The Trustee may consult with reputable counsel (who may but need not be
counsel for the City) and the opinion of such counsel shall be full and complete authorization and
protection in respect of any action taken or suffered by it hereunder in good faith and in accordance
with the opinion of such counsel;
(d) Whenever in the administration of the trusts under this Indenture, the
Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking
or suffering any action hereunder, such matter(unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence or bad faith on the part of the Trustee,
be deemed to be conclusively proved and established by a certificate of the City; and such
certificate of the City shall, in the absence of negligence or bad faith on the part of the Trustee, be
full warranty to the Trustee for any action taken or suffered by it under the provisions of this
Indenture upon the faith thereof.
Section 9.4 Trustee not Responsible for Recitals and Other Matters. The Trustee shall
not be responsible in any manner whatsoever for the correctness of the recitals herein or in the
Series 2024 Bonds (except the Trustee's certificate of authentication thereon), all of which are
made by the City solely; and the Trustee shall not be responsible or accountable in any manner
whatsoever for or with respect to the validity or execution or sufficiency of this Indenture, or of
any indenture supplemental hereto, or of the Bond Ordinance or the Series 2024 Bonds, or the
sufficiency of the taxes levied to pay the principal of and interest on the Series 2024 Bonds, or for
the security afforded hereby or for the validity of any securities at any time held hereunder, and
the Trustee makes no representation with respect thereto. The Trustee shall not be accountable for
the use or application by the City of the proceeds of any Series 2024 Bonds authenticated and
delivered hereunder, or for the use or application of any moneys paid over by the Trustee in
accordance with any provision of this Indenture.
Section 9.5 Trustee May Acquire Series 2024 Bonds. The Trustee and its officers and
directors may acquire and hold, or become the pledgee of, Series 2024 Bonds and may otherwise
deal with the City in the manner and to the same extent and with like effect as though it were not
Trustee hereunder.
Section 9.6 Qualification of Trustee. There shall at all times be a Trustee hereunder
which shall be a corporation organized and doing business under the laws of the United States or
any state thereof,authorized under such laws to exercise corporate trust powers,having a combined
capital, surplus and undivided profits of at least $25,000,000, and subject to supervision or
examination by federal or state authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of any supervising or examining authority above
referred to, then for the purposes of this paragraph the combined capital, surplus and undivided
profits of such corporation shall be deemed to be its combined capital, surplus and undivided
profits as set forth in its most recent report of condition so published. In case at any time the Trustee
shall cease to be eligible in accordance with the provisions of this paragraph, the Trustee shall
resign immediately in the manner and with the effect specified in Section 9.7.
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Section 9.7 Resignation or Removal of Trustee and Appointment of Successor. The
Trustee may at any time resign by giving written notice to the City, the Bond Insurer, and the
Bondholders by first class mail to the names and addresses shown on the list maintained by the
Bond Registrar. Upon receiving such notice of resignation, the City shall promptly appoint a
successor Trustee by an instrument in writing executed by order of the City. If no successor Trustee
shall have been so appointed and have accepted appointment within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction
for the appointment of a successor Trustee,or any Bondholder who has been a bona fide holder of
a Series 2024 Bond or Series 2024 Bonds for at least six months may, on behalf of himself and all
others similarly situated, petition any such court for the appointment of a successor Trustee. Such
court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoint a
successor Trustee.
(a) In case at any time any of the following shall occur:
(i) The Trustee shall cease to be eligible in accordance with the
provisions of Section 9.6 and shall fail to resign after written request therefor by
the City or by any Bondholder who has been a bona fide holder of a Series 2024
Bond or Series 2024 Bonds for at least six months, or
(ii) The Trustee shall become incapable of acting, or shall be adjudged
a bankrupt or insolvent, or a receiver of the Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or liquidation,
then, in any such case, the City may remove the Trustee and appoint a successor Trustee by an
instrument in writing executed by order of the City or any Bondholder may, on behalf of himself
and all others similarly situated,petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee. Such court may thereupon, after such notice,
if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor Trustee.
(b) After the recurrence of an Event of Default,the Bond Insurer or the holders
of a majority in aggregate principal amount of all the Series 2024 Bonds at the time outstanding
may remove the Trustee and appoint a successor Trustee by an instrument or concurrent
instruments in writing signed by the Bond Insurer or such Bondholders. Such successor Trustee
shall be a corporation authorized under applicable laws to exercise corporate trust powers, may be
incorporated under the laws of the United States or of any State within the United States. Such
successor Trustee shall satisfy the minimum combined capital, surplus and undivided profits
requirement set forth in Section 9.6.
(c) Provided no Event of Default has occurred hereunder, the City may at any
time remove the Trustee and appoint a successor Trustee by an instrument in writing signed by the
City.
(d) Any resignation or removal of the Trustee and appointment of a successor
Trustee pursuant to any of the provisions of this Section 9.7 shall become effective upon
acceptance of appointment by the successor Trustee as provided in Section 9.8.
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Section 9.8 Concerning the Successor Trustee. Any successor Trustee appointed as
provided in Section 9.7 shall execute, acknowledge and deliver to the City and to its predecessor
Trustee an instrument accepting such appointment hereunder, and thereupon the resignation or
removal of the predecessor Trustee shall become effective and such successor Trustee, without
any further act, deed or conveyance, shall become vested with all the rights, powers, trusts, duties
and obligations of its predecessor in the trusts hereunder, with like effect as if originally named as
Trustee herein; but nevertheless on the written request of the City or the request of the successor
Trustee, the Trustee ceasing to act shall execute and deliver an instrument transferring to such
successor Trustee, upon the trusts herein expressed, all the rights,powers and trusts of the Trustee
so ceasing to act. Upon request of any such successor Trustee, the City shall execute any and all
instruments in writing more fully and certainly vesting in and confirming to such successor Trustee
all such rights, powers and duties. Any Trustee ceasing to act shall nevertheless be entitled to
receive the amounts due it as compensation, reimbursement, expenses and indemnity afforded to
it by this Article 9.
No successor Trustee shall accept appointment as provided in this Section 9.8 unless at the
time of such acceptance such successor Trustee shall be eligible under the provisions of Section
9.6.
Upon the acceptance of appointment by a successor Trustee as provided in this Section 9.8,
the City shall mail a copy of such notice to each person whose name appears as an owner of Series
2024 Bonds on the list maintained by the Bond Registrar. If the City fails to mail such notice within
10 days after acceptance of appointment by the successor Trustee,the successor Trustee shall cause
such notice to be mailed at the expense of the City from amounts on deposit in the Administrative
Expense Fund.
Section 9.9 Monthly Statements. The Trustee shall provide to the Consultant and the
City, or their designees, a monthly statement, commencing on 1, 2024, itemizing all
moneys received by it and all payments made by it under this Indenture during the preceding
monthly period and annual reports relating to the Funds and Accounts created under this Indenture
and such other information relating to the Series 2024 Bonds and the Funds and Accounts
maintained by the Trustee under this Indenture as the Purchaser, the Bond Insurer and the City
shall reasonably request.
ARTICLE 10
SUPPLEMENTAL INDENTURES
Section 10.1 Supplemental Indentures Not Requiring Consent of Bondholders. The City
by the Corporate Authorities, and the Trustee from time to time and at any time, subject to the
conditions and restrictions in this Indenture contained including,without limitation,the provisions
of Section 10.6 hereof,may pass and accept an indenture or indentures supplemental hereto,which
indenture or indentures thereafter shall form a part hereof, for any one or more of the following
purposes:
(a) To add to the covenants and agreements of the City in this Indenture
contained, other covenants and agreements thereafter to be observed or to surrender, restrict or
limit any right or power herein reserved to or conferred upon the City;
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(b) To grant to or confer upon the Trustee for the benefit of the owners of the
Series 2024 Bonds any additional rights,remedies,powers, authority or security that may lawfully
be granted to or conferred upon the owners or the Trustee;
(c) To modify,amend or supplement this Indenture in such manner as to permit,
if presented,the qualification of this Indenture under the Trust Indenture Act of 1939 or any similar
federal statute then in effect or under any state blue sky law; and
(d) To surrender any right,power or privilege reserved to or conferred upon the
City by the terms of this Indenture, provided that the surrender of such right, power or privilege is
not contrary to or inconsistent with the covenants and agreements of the City contained in this
Indenture.
(e) To issue refunding bonds subject to the limitations set forth in the Special
Tax Roll and Report and the Establishing Ordinance.
(f) To permit any other amendment that, in the judgment of the Trustee, is not
materially adverse to the Trustee or the Holders.
Any supplemental indenture authorized by the provisions of this Section 10.1 may be
executed by the City, by the Corporate Authorities, and by the Trustee without the consent of the
registered owners of any of the Series 2024 Bonds at the time outstanding, but only upon receipt
of an opinion of bond counsel if requested pursuant to the provisions of Section 10.6,
notwithstanding any of the provisions of Section 10.2, but the Trustee shall not be obligated to
accept any provision of such supplemental indenture to the extent that it affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
Section 10.2 Supplemental Indentures Requiring Consent of Bondholders. With the
consent (evidenced as provided herein) of the Bond Insurer and the registered owners of not less
than a majority in aggregate principal amount of the Series 2024 Bonds, respectively, at the time
outstanding, but only upon receipt of an opinion of bond counsel if requested pursuant to the
provisions of Section 10.6, the City, by the Corporate Authorities may pass, and the Trustee may
accept from time to time and at any time an indenture or indentures supplemental hereto for the
purpose of adding any provisions to or changing in any manner or eliminating any of the provisions
of this indenture or of any supplemental indenture; provided that no such modification or
amendment shall extend the maturity or reduce the principal of or the interest rate on or otherwise
alter or impair the obligation of the City to pay the principal, interest or redemption premium, if
any, at the time and place and at the rate and in the currency provided therein of any Series 2024
Bond without the express consent of the registered owner of such Series 2024 Bond or permit the
creation of a preference or priority of any Series 2024 Bond or Series 2024 Bonds over any other
Series 2024 Bond or Series 2024 Bonds or reduce the percentage of Series 2024 Bonds,
respectively,required for the affirmative vote or written consent to an amendment or modification,
or deprive the registered owners of the Series 2024 Bonds, respectively, (except as aforesaid) of
the right to payment of the Series 2024 Bonds, respectively, from the Special Taxes and the
Foreclosure Proceeds without the consent of the registered owners of all the Series 2024 Bonds
(as the case may be) then outstanding. Upon receipt by the Trustee of a certified copy of such
Indenture and upon the filing with the Trustee of evidence of the consent of the Bond Insurer and
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Bondholders as aforesaid, the Trustee shall accept such supplemental indenture, but the Trustee
shall not be obligated to accept any provision of such supplemental indenture to the extent that it
affects the Trustee's own rights, duties or immunities under this Indenture or otherwise.
It shall not be necessary for the consent of the Bondholders under this paragraph to approve
the particular form of any proposed supplemental indenture, but it shall be sufficient if such
consent shall approve the substance thereof.
Promptly after the passage by the City and the acceptance by the Trustee of any
supplemental indenture pertaining to the Series 2024 Bonds pursuant to the provisions of this
paragraph,the City shall cause the Trustee to mail a notice by first class mail to the Bond Insurer
and the Bondholders, setting forth in general terms the substance of such supplemental indenture,
and that the supplemental Indenture has been consented to by the Bond Insurer and the requisite
percentage of the Bondholders. Any failure of the City to give such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such supplemental indenture.
Section 10.3 Supplemental Indenture to Modify this Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions of this Article 10, and upon receipt of the
opinion of bond counsel if required by the provisions of Section 10.6, this Indenture shall be
modified and amended in accordance therewith and the respective rights, duties and obligations
under this Indenture of the City, the Trustee and all registered owners of Series 2024 Bonds,
respectively, outstanding thereunder shall thereafter be determined, exercised and enforced
hereunder subject in all respects to such modification and amendments, and all the terms and
conditions of any such supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
Section 10.4 Trustee May Rely Upon Opinion of Counsel Re: Supplemental Indenture.
The Trustee may receive an opinion of counsel as conclusive evidence that any supplemental
indenture executed pursuant to the provisions of this Article 10 complies with the requirements of
this Article 10.
Section 10.5 Notation. Series 2024 Bonds authenticated and delivered after the
execution of any supplemental indenture pursuant to the provisions of this Article 10 may bear a
notation, in form approved by the Trustee, as to any matter provided for in such supplemental
indenture, and if such supplemental indenture shall so provide, new Series 2024 Bonds, so
modified as to conform, in the opinion of the Trustee and the Corporate Authorities, to any
modification of this Indenture contained in any such supplemental indenture, may be prepared by
the City, authenticated by the Trustee and delivered without cost to the registered owners of the
Series 2024 Bonds then outstanding, upon surrender for cancellation of such Series 2024 Bonds in
equal aggregate principal amounts.
Section 10.6 Opinion of Bond Counsel. Prior to the adoption of a supplemental indenture
executed pursuant to the provisions of this Article 10 the Trustee shall give written notice by mail
to the registered owners of all Series 2024 Bonds Outstanding at the addresses as set forth in the
Register of the Series 2024 Bonds held by the Bond Registrar of the substance of the proposed
supplemental indenture. If within 10 days of the Trustee's mailing such notice any registered
owner of the Series 2024 Bonds requests that an opinion of bond counsel be delivered to the effect
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that such supplemental indenture will not adversely affect the exclusion from gross income of
interest on the Series 2024 Bonds for federal income tax purposes, such supplemental indenture
shall not become effective until such opinion has been delivered to the Trustee.
ARTICLE 11
DEFEASANCE
Section 11.1 Defeasance.
(a) If the City shall pay or cause to be paid, or there shall otherwise be paid,to
the Owners of all Series 2024 Bonds the principal or Redemption Price, if applicable, and interest
due or to become due thereon, at the times and in the manner stipulated therein and in this
Indenture,then the pledge of the Trust Estate, and all covenants, agreements and other obligations
of the City to the Bondholders, shall thereupon cease, terminate and become void and be
discharged and satisfied. In such event, the Trustee shall cause an accounting for such period or
periods as shall be requested by the City to be prepared and filed with the City and, upon the
request of the City, shall execute and deliver to the City all such instruments as may be desirable
to evidence such discharge and satisfaction, and the Trustee shall pay over or deliver to the City
all moneys or securities held pursuant to this Indenture which are not required for the payment of
principal or Redemption Price, if applicable,of and interest on Series 2024 Bonds. If the City shall
pay or cause to be paid, or there shall otherwise be paid,to the Owners of any Outstanding Series
2024 Bonds the principal or Redemption Price and interest due or to become due thereon, at the
times and in the manner stipulated therein and in this Indenture, such Series 2024 Bonds shall
cease to be entitled to any lien, benefit or security under this Indenture, and all covenants,
agreements and obligations of the City to the Owners of such Bonds shall thereupon cease,
terminate and become void and be discharged and satisfied.
(b) Series 2024 Bonds or interest installments for the payment or redemption
of which moneys shall have been set aside and shall be held in trust by the Trustee(through deposit
by the City of funds for such payment or redemption or otherwise) at the maturity or redemption
date thereof shall be deemed to have been paid within the meaning and with the effect expressed
in subsection (a) of this Section 11.1. In addition, any Outstanding Series 2024 Bonds shall, prior
to the maturity or redemption date thereof, be deemed to have been paid within the meaning and
with the effect expressed in subsection(a)of this Section 11.1 upon compliance with the provisions
of subsection (c) of this Section 11.1.
(c) Subject to the provisions of subsection (d) of this Section 11.1, any
Outstanding Series 2024 Bonds shall, prior to the maturity or redemption date thereof, be deemed
to have been paid within the meaning and with the effect expressed in subsection(a)of this Section
11.1 if:
(i) in case any of said Series 2024 Bonds are to be redeemed on any
date prior to their maturity, the City shall have given to the Trustee irrevocable
instructions accepted in writing by the Trustee to give as provided in Section 3.5
notice of redemption of such Bonds on said date;
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(ii) there shall have been deposited with the Trustee either moneys in an
amount which shall be sufficient or Defeasance Securities,the principal of and the
interest on which when due will provide moneys which,together with the moneys,
if any, deposited with the Trustee at the same time, shall be sufficient,to pay when
due the principal or Redemption Price, if applicable,and interest due and to become
due on said Series 2024 Bonds on or prior to the redemption date or maturity date
thereof, as the case may be; and
(iii) in the event said Series 2024 Bonds do not mature, are not by their
terms subject to redemption or, under the plan of refunding applicable thereto, are
not to be redeemed, in each case, within the next succeeding ninety (90) days, the
City shall have given the Trustee in form satisfactory to it irrevocable instructions
to give, as soon as practicable, by first-class mail, postage prepaid, to the owners
of such Series 2024 Bonds at their last addresses appearing on the books of the City
kept at the office of the Bond Registrar a notice that the deposit required by (ii)
above has been made with the Trustee and that said Series 2024 Bonds are deemed
to have been paid in accordance with this Section 11.1 and stating such maturity or
redemption date upon which moneys are to be available for the payment of the
principal or Redemption Price, if applicable, on said Series 2024 Bonds.
In the event Defeasance Securities are deposited with the Trustee the City shall also provide a
Verification verifying the sufficiency of the Defeasance Securities to pay the Series 2024 Bonds
in full on the maturity or redemption date.
(d) Anything in this Indenture to the contrary notwithstanding, any moneys
held in trust for the payment and discharge of any of the Series 2024 Bonds which remain
unclaimed for one year after the date when such Series 2024 Bonds have become due and payable,
either at their stated maturity dates or by call for earlier redemption shall be repaid to the City, as
its absolute property and free from trust, and the Trustee shall thereupon be released and
discharged, with respect thereto and the Bondholders shall look only to the City for the payment
of such Series 2024 Bonds; provided, however, that before being required to make any such
payment to the City,the Trustee shall, at the expense of the City, give to the owners of such Series
2024 Bonds as to which any moneys remain unclaimed, by first class mail, postage prepaid, at the
last address of such owners appearing on the books of the City kept at the office of the Bond
Registrar, a notice that said moneys remain unclaimed and that, after a date named in said notice,
which date shall be not less than thirty (30) days after the date of the mailing of such notice, the
balance of such moneys then unclaimed will be returned to the City.
(e) Upon the payment or defeasance of all outstanding Series 2024 Bonds as
provided in this Article 11,the Trustee and the City shall execute a Satisfaction of Tax Lien for all
Parcels for which a satisfaction of tax lien has not previously been delivered and the City shall file
or cause to be filed such Satisfaction of Tax Lien with the Recorder of Deeds of Kendall County,
Illinois.
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ARTICLE 12
MISCELLANEOUS
Section 12.1 Severability. If any provision of this Indenture shall be held or deemed to
be illegal, inoperative or unenforceable under applicable law or interpreted in such manner as to
be prohibited by or be held invalid under such law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Indenture.
Section 12.2 Notices. Except as otherwise provided in this Indenture, all notices,
certificates or other communications hereunder shall be sufficiently given and shall be deemed
given when personally delivered or mailed by certified mail, postage prepaid, or when sent by
telecopy (receipt confirmed by telephone)or telegram, addressed as follows:
If to the City: United City of Yorkville
651 Prairie Pointe Drive
Yorkville, IL 60560
Attention: Mayor
Telephone: (630) 553-4350
Bond Counsel: Saul Ewing LLP
161 North Clark St., Suite 4200
Chicago, IL 60601
Attention: Randall S. Kulat
Telephone: (312) 876-7877
If to the Trustee: Amalgamated Bank of Chicago
30 North LaSalle Street, 38th Floor
Chicago, IL 60602
Attention: Erika Forshtay
Telephone: (312) 822-8361
Fax: (312) 541-6044
If to the Purchaser: D.A. Davidson& Co.
227 W. Monroe Street. Suite 5250
Chicago, IL 60606
Attention: Peter Raphael
Telephone: (312) 525-2776
If to the Bond Insurer:
With a copy to:
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The Trustee agrees to accept and act upon instructions or directions pursuant to the Indenture sent
by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods,
provided, however, that the Trustee shall have received an incumbency certificate listing persons
designated to give such instructions or directions and containing specimen signatures of such
designated persons, which such incumbency certificate shall be amended and replaced whenever
a person is to be added or deleted from the listing.
Section 12.3 Holidays. If any date for the payment of an amount hereunder or the taking
of any other action required or permitted to be taken hereunder, is not a Business Day, then such
payment shall be due,or such action shall or may be taken,as the case may be,on the first Business
Day thereafter with the same force and effect as if done on the nominal date provided in this
Indenture.
Section 12.4 Execution of Counterparts. This Indenture may be executed in several
counterparts, each of which shall be an original and all of which shall constitute but one and the
same instrument.
Section 12.5 Applicable Law. This Indenture shall be governed by and construed in
accordance with the internal laws of the State.
Section 12.6 Immunity of Officers, Employees, Elected Officials of City. No recourse
shall be had for the payment of the principal of or premium, if any, or interest on any of the Series
2024 Bonds or for any claim based thereon or upon any obligation, covenant or agreement
contained in this Indenture or any agreement supplemental hereto, against any past, present or
future Mayor, trustee or other officer, director, member, employee, attorney or agent of the City,
or any incorporator, officer, director, member, trustee, employee or agent of any successor
corporation or body politic,as such,either directly or through the City or any successor corporation
or body politic, under any rule of law or equity, statute or constitution or by the enforcement of
any assessment or penalty or otherwise, and all such liability of any such incorporators, officers,
directors, trustees, members, employees or agents, as such, is hereby expressly waived and
released as a condition of and consideration for the execution of this Indenture and the issuance of
any of the Series 2024 Bonds.
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IN WITNESS WHEREOF,the United City of Yorkville, Illinois has caused these presents
to be signed in its name and on its behalf by its Mayor and its corporate seal to be hereunto affixed
and attested by its City Clerk and to evidence its acceptance of the trusts hereby created
Amalgamated Bank of Chicago has caused these presents to be signed in its name and on its behalf
by its Authorized Officer, its official seal to be hereunto affixed and the same to be attested by its
Authorized Officer, all as of the day and year first above written.
UNITED CITY OF YORKVILLE, KENDALL
COUNTY,ILLINOIS
By:
Mayor
[SEAL]
Attest:
By:
City Clerk
AMALGAMATED BANK OF CHICAGO,
as Trustee
By:
Authorized Officer
[SEAL]
Attest:
By:
Authorized Officer
[Signature Page to Trust Indenture]
51659324.8
EXHIBIT A
UNITED CITY OF YORKVILLE
SPECIAL SERVICE AREA NUMBER 2004-107
A-1
51659324.8
MIIL.
EXHIBIT B
(Insert insurance disclaimer)
UNITED STATES OF AMERICA
STATE OF ILLINOIS COUNTY OF KENDALL
UNITED CITY OF YORKVILLE
SPECIAL SERVICE AREA NUMBER 2004-107
SPECIAL TAX REFUNDING BOND, SERIES 2024
(RAINTREE VILLAGE II PROJECT)
Bond No.: R- Principal Amount: $
Date of Bond: Interest Rate:
CUSIP: Date of Maturity: March 1, 20
Registered Owner: Cede & Co.
The United City of Yorkville, Kendall County, Illinois (the "City"), for value received,
promises to pay to the Registered Owner specified above or registered assigns, upon presentation
and surrender of this bond at the office of Amalgamated Bank of Chicago, Chicago, Illinois, as
Trustee(the"Trustee")the Principal Amount of this bond specified above on the Date of Maturity
specified above and to pay the Registered Owner of this bond interest on that sum at the Interest
Rate per year specified above from the Date of Bond specified above to the Date of Maturity
specified above,payable semiannually on March 1 and September 1,with the first interest payment
date being September 1, 2024. Interest shall be computed on the basis of a 360 day year of twelve
30 days months. Interest on this bond shall be payable on each interest payment date by check or
draft of the Trustee mailed to the person in whose name this bond is registered at the close of
business on the 15th day of the month preceding such interest payment date. During such time as
this bond is registered so as to participate in a securities depository system with The Depository
Trust Company ("DTC"), principal of and interest on this Bond shall be payable by wire transfer
pursuant to instructions from DTC. The principal of, interest on and redemption premium on this
bond are payable in lawful money of the United States of America.No interest shall accrue on this
bond after its Date of Maturity unless this bond shall have been presented for payment at maturity
and shall not then have been paid.
This bond is one of an authorized issue of bonds in the aggregate principal amount of
$ This bond and the issue of which it is a part(together,the"Series 2024 Bonds")are
issued pursuant to the provisions of the "Special Service Area Tax Law," 35 ILCS §200/27 5, et
seq.,as amended,and the provisions of the Local Government Debt Reform Act, 30 ILCS §350/1,
et seq., as amended, and the principal of and interest on the Series 2024 Bonds are payable from
special taxes designated as Special Taxes (the "Special Taxes") levied on all taxable real property
within the United City of Yorkville Special Service Area Number 2004-107 (the"Special Service
Area")pursuant to a special tax roll.
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The Series 2024 Bonds are being issued for the purpose of paying a portion of refunding
certain special service area bonds of the City, all as more fully described in an ordinance adopted
by the Mayor and City Council of the City on March 12, 2024 as supplemented by a Bond Order
executed pursuant thereto (collectively, the "Bond Ordinance") and a Trust Indenture dated as of
March 1, 2024 between the City and the Trustee (the "Indenture"), to all the provisions of which
the holder by the acceptance of this bond assents. Terms not otherwise defined herein shall have
the meanings ascribed to such terms in the Indenture. The Series 2024 Bonds, together with the
interest thereon, are limited obligations of the City, payable solely from the collection of the
Special Taxes and other moneys deposited in certain Funds and Accounts established pursuant to
the Indenture. For the prompt payment of the principal of and interest on this bond the Special
Taxes are hereby irrevocably pledged. THE SERIES 2024 BONDS DO NOT CONSTITUTE
GENERAL OBLIGATIONS OF THE CITY AND NEITHER THE FULL FAITH AND CREDIT
NOR THE UNLIMITED TAXING POWER OF THE CITY SHALL BE PLEDGED AS
SECURITY FOR THE PAYMENT OF THE SERIES 2024 BONDS.
[The Series 2024 Bonds maturing on March 1, are subject to mandatory redemption,
in part and randomly, at the Redemption Price equal to the principal amount thereof to be
redeemed, without premium, on March 1 of the years and in the amounts as follows:
Redemption Date Principal
March 1 Amount
The City covenants that it will redeem the Series 2024 Bonds pursuant to the mandatory
sinking fund redemption requirements for the Series 2024 Bonds to the extent amounts are on
deposit in the Bond and Interest Fund.]
The Series 2024 Bonds maturing on and after March 1, are subject to optional
redemption prior to maturity at the option of the City, in whole or in part, on any date on or after
March 1, , at a redemption price equal to the principal amount of the Bonds to be redeemed,
plus accrued and unpaid interest to the date of redemption.
Any optional redemption of Series 2024 Bonds shall be applied to the extent possible, to
reduce pro rata the amount maturing [or required to be redeemed by mandatory sinking fund
redemption] pursuant to the Indenture, and so as to maintain the proportion of principal maturing
• [or subject to mandatory sinking fund redemption] in each year to the total original principal
amount of Series 2024 Bonds.
The Series 2024 Bonds, are also subject to mandatory redemption on any interest payment
date, in part, at a redemption price equal to the principal'amount to be redeemed, together with
accrued interest to the date fixed for redemption, without premium, from amounts in the Bond and
Interest Fund consisting of the proceeds received by the City in connection with a condemnation
of any of the special services or any other property owned by or dedicated to the City within the
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Special Service Area and allocable to the Series 2024 Bonds as determined by the Consultant and
which proceeds are not used by the City to rebuild the Special Services.
The Series 2024 Bonds are also subject to mandatory redemption on any March 1, June 1,
September 1 or December 1, in part, from amounts available for disbursement from the Special
Redemption Account and from amounts transferred from the Reserve Fund and the Special
Reserve Fund to the Special Redemption Account in connection with optional prepayments of the
Special Taxes, at a redemption price (expressed as a percentage of the principal amount of the
Series 2024 Bonds to be redeemed), as set forth below, together with accrued interest on such
Series 2024 Bonds to the date fixed for redemption:
Redemption Dates Redemption Prices
Any mandatory redemption of the Series 2024 Bonds in part from proceeds from
condemnation or prepayments of the Special Taxes shall be applied to reduce pro rata the amount
of Series 2024 Bonds maturing [or required to be redeemed by mandatory sinking fund
redemption] pursuant to the Indenture, and so as to maintain the proportion of principal maturing
[or subject to mandatory sinking fund redemption] in each year to the total original principal
amount of Series 2024 Bonds.
If less than all the Series 2024 Bonds of any maturity are to be redeemed on any redemption
date by mandatory or optional redemption,written notice shall be given to the Trustee as provided
in the Indenture. The Bond Registrar named below will assign to each Series 2024 Bond of the
maturity to be redeemed a distinctive number for each $1,000 of principal amount of that Series
2024 Bond. The Bond Registrar will then select by lot from the numbers so assigned, using such
method as it shall deem proper in its discretion, as many numbers as, at $1,000 per number, shall
equal the principal amount of Series 2024 Bonds of that maturity to be redeemed; provided that
following any redemption, no Series 2024 Bonds shall be outstanding in an amount less than the
minimum Authorized Denomination except (a) as necessary to effect the mandatory sinking fund
redemption of Series 2024 Bonds as provided in the Indenture,or(b)to effect a special mandatory
redemption from optional prepayments when the total aggregate principal amount of Bonds
outstanding is $5,000 or less.
Notice of the redemption of any Series 2024 Bonds,which by their terms shall have become
subject to redemption, will be given to the registered owner of each Series 2024 Bond called for
redemption in whole or in part not less than 30 or more than 60 days before any date established
for redemption of Series 2024 Bonds, by the Bond Registrar, on behalf of the City, by registered
or certified mail sent to the registered owner's last address, if any, appearing on the registration
books kept by the Bond Registrar. All notices of redemption shall include at least the designation,
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date and maturities of Series 2024 Bonds called for redemption,CUSIP Numbers, if available,and
the date of redemption. In the case of a Series 2024 Bond to be redeemed in part only, the notice
will also specify the portion of the principal amount of the Series 2024 Bond to be redeemed. The
mailing of the notice specified above to the registered owner of any Series 2024 Bond will be a
condition precedent to the redemption of that Series 2024 Bond, provided that any notice which is
mailed in accordance with the Indenture will be conclusively presumed to have been duly given
whether or not the owner received that notice. The failure to mail notice to the owner of any Series
2024 Bond, or any defect in that notice, shall not affect the validity of the redemption of any other
Series 2024 Bonds.
With respect to an optional redemption of any Series 2024 Bonds,unless moneys sufficient
to pay the principal of, redemption premium, if any, and interest on the Series 2024 Bonds to be
redeemed shall have been received by the Trustee prior to the giving of such notice of redemption,
such notice may, at the option of the City, state that said redemption shall be conditional upon the
receipt of such moneys by the Trustee on or prior to the date fixed for redemption. If such moneys
are not received, such notice shall be of no force and effect, the City shall not redeem such Series
2024 Bonds and the Trustee shall give notice, in the same manner in which the notice of
redemption was given, that such moneys were not so received and that such Series 2024 Bonds
will not be redeemed.
This bond is negotiable, subject to the following provisions for registration and registration
of transfer.The City maintains books for the registration and registration of transfer of Series 2024
Bonds at the office of the Trustee, as Bond Registrar. This bond is fully registered on those books
in the name of its owner, as to both principal and interest, and transfer of this bond may be
registered on those books upon surrender of this bond to the Bond Registrar by the registered
owner or his or her attorney duly authorized in writing together with a written instrument of
transfer satisfactory to the Bond Registrar duly executed by the registered owner or his or her duly
authorized attorney. Upon surrender of this bond for registration of transfer, a new bond or bonds
in the same aggregate principal amount and of the same maturity will be issued to the transferee
as provided in the Indenture.
This bond may be exchanged,at the option of the Registered Owner,for an equal aggregate
principal amount of bonds of the same maturity of any other Authorized Denominations, upon
surrender of this bond at the office of the Bond Registrar with a written instrument of transfer
satisfactory to the Bond Registrar duly executed by the Registered Owner or his or her duly
authorized attorney.
For every exchange or registration of transfer of this bond, the City or the Bond Registrar
may make a charge sufficient to reimburse it for any tax, fee or other governmental charge, other
than one imposed by the City, required to be paid with respect to that exchange or registration of
transfer, and payment of that charge by the person requesting exchange or registration of transfer
shall be a condition precedent to that exchange or registration of transfer.No other charge may be
made by the City or the Bond Registrar as a condition precedent to exchange or registration of
transfer of this bond.
The Bond Registrar shall not be required to exchange or register the transfer of any Series
2024 Bond following the close of business on the I5th day of the month preceding any interest
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payment date on such Series 2024 Bond, nor to transfer or exchange any Series 2024 Bond after
notice calling such Series 2024 Bond for redemption has been mailed, nor during a period of 15
days next preceding mailing of a notice of redemption of any Series 2024 Bonds.
The City, the Trustee and the Bond Registrar may deem and treat the registered owner of
this bond as its absolute owner, whether or not this bond is overdue, for the purpose of receiving
payment of the principal of or interest on this bond and for all other purposes,and neither the City,
the Bond Registrar nor the Trustee shall be affected by any notice to the contrary. Payment of the
principal of and interest on this bond shall be made only to its registered owner, and all such
payments shall be valid and effective to satisfy the obligation of the City on this bond to the extent
of the amount paid.
All conditions which by law must have existed or must have been fulfilled in the issuance
of this bond existed and were fulfilled in compliance with law. Provision has been made for the
levy, collection and segregation of the Special Taxes sufficient to pay and discharge the principal
of this bond at maturity and to pay interest on this bond as it falls due. The issuance of the Series
2024 Bonds by the City will not cause the City to exceed or violate any applicable limitation or
condition respecting the issuance of bonds imposed by the law of the State of Illinois or by any
Indenture, ordinance or resolution of the City. The Series 2024 Bonds are issued for purposes for
which the City is authorized by law to issue bonds including but not limited to finance or refinance
a portion of the costs of the special services to be provided to the Special Service Area, making
deposits to a reserve fund, administrative expense fund and paying costs of the City in connection
with the issuance of the Series 2024 Bonds.
This bond shall not be valid for any purpose unless and until the certificate of authentication
on this bond shall have been duly executed by the Trustee.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the United City of Yorkville, Kendall County, Illinois, by its
Mayor and City Council,has caused this bond to be executed by the manual or facsimile signature
of its Mayor and attested by the manual or facsimile signature of its City Clerk and has caused its
corporate seal to be affixed to this bond (or a facsimile of its seal to be printed on this bond), all
as of the Date of Bond specified above.
UNITED CITY OF YORKVILLE,
KENDALL COUNTY,ILLINOIS
By:
Mayor
(SEAL)
Attest:
City Clerk
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CERTIFICATE OF AUTHENTICATION
This bond is one of the bonds described in the Indenture authorizing the issuance of
$ United City of Yorkville, Kendall County, Illinois Special Service Area Number
2004-107 Special Tax Refunding Bonds, Series 2024 (Raintree Village II Project).
AMALGAMATED BANK OF CHICAGO,
as Trustee
By:
Authorized Signatory
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51659324.8
FORM OF ASSIGNMENT
For Value Received, the undersigned sells, assigns and transfers to
this bond and all rights and title under this bond, and irrevocably constitutes and appoints
attorney to transfer this bond on the books kept for registration of
this bond.
Dated:
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EXHIBIT C
(The Above Space For Recorder's Use Only)
This Document was
prepared by Saul Ewing LLP
and after recording return to:
Amalgamated Bank of Chicago
Attn: Corporate Trust Department
30 North LaSalle Street, 38th Floor
Chicago, Illinois 60602
SATISFACTION OF TAX LIEN
The undersigned duly elected and acting Mayor of the United City of Yorkville, Kendall
County, Illinois (the "City"), in consideration of the receipt of the sum of $ , hereby
acknowledges and certifies that special taxes levied and to be extended in accordance with the
Special Tax Roll approved by the Mayor and City Council of the City pursuant to Ordinance No.
2005-90 (the "Establishing Ordinance") are paid and the lien of such taxes satisfied with respect
to the following lots in the City's Special Service Area Number 2004-107 (the "SSA") legally
described on Exhibit A attached hereto:
Lot PIN
The undersigned further certifies that pursuant to Exhibit B to the United City of Yorkville
Special Service Area Number 2004-107 Special Tax Roll and Report which is incorporated in the
Establishing Ordinance as Exhibit F (the "Special Tax Roll and Report"), upon payment of the
prepayment amount as calculated pursuant to the Special Tax Roll and Report,the Consultant shall
cause the satisfaction of tax lien to be recorded within 30 working days of receipt of the
prepayment.
Dated: , 20 UNITED CITY OF YORKVILLE,
KENDALL COUNTY,ILLINOIS
Authorized Officer
Approved by:
Consultant
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The Trustee hereby acknowledges receipt of the sum of$
AMALGAMATED BANK OF CHICAGO,
as Trustee
By:
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51659324.8
STATE OF ILLINOIS )
) SS.
COUNTY OF KENDALL )
I, , a Notary Public in and for such County and State
aforesaid,do hereby certify that , personally known to me to
be the of the United City of Yorkville,Kendall County,Illinois,whose
name is subscribed to the foregoing Satisfaction, appeared before me this day in person and
acknowledged that as such officer he signed and delivered the foregoing Satisfaction as such
officer of the United City of Yorkville, Illinois, as his free and voluntary act, and as the free and
voluntary act and deed of such City, for the uses and purposes therein set forth.
Given under my hand and notarial seal, this day of , 20
Notary Public
Commission expires , 20
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EXHIBIT D
COSTS OF ISSUANCE DISBURSEMENT REQUEST
TO: Amalgamated Bank of Chicago
Attn: Corporate Trust Department
30 North LaSalle Street, 38th Floor
Chicago, Illinois 60602
RE: $ United City of Yorkville, Kendall County, Illinois
Special Service Area Number 2004-107 Special Tax Refunding Bonds,Series
2024 (Raintree Village II Project)
Amount Requested:
Total Disbursements to Date:
1. Eachobligation f r which a disbursement is herebyrequested is described in
ac o q
and address of theperson, or
reasonable detail in Schedule I hereto together with the namefirm,
corporation to whom payment is due and any other payment instructions.
2. The bills, invoices, or statements of account for each obligation referenced in
Schedule I are attached hereto as Schedule II.
3. The City hereby certifies that:
a. This written requisition is for payment of costs in connection with the
issuance of the above-referenced Series 2024 Bonds and the specific purpose for which this request
is made is described in Schedule I.
b. Payment instructions sufficient to make the requested payment are set forth
in Schedule I.
c. No portion of the amount being requested to be disbursed was set forth in
any previous request for disbursement.
4. All capitalized terms herein shall have the meanings assigned to them in the Trust
Indenture for the above-referenced Special Service Area Number 2004-107 Special Tax Refunding
Bonds, Series 2024 (Raintree Village II Project) dated as of March 1, 2024 by and between the
United City of Yorkville, Kendall County, Illinois and Amalgamated Bank of Chicago,as Trustee.
By:
Authorized Signatory
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51659324.8
Exhibit C
Form of Bond Purchase Agreement
(See attached)
51642736.6
United City of Yorkville, Illinois
Special Service Area Number 2004-107
Special Tax Refunding Bonds,Series 2024 (Raintree Village II Project)
BOND PURCHASE AGREEMENT
, 2024
United City of Yorkville, Illinois
651 Prairie Pointe Drive
Yorkville, Illinois 60560
Ladies and Gentlemen:
The undersigned, D.A. Davidson & Co. (the "Underwriter"), offers to enter in to the
following agreement (this "Contract")with the United City of Yorkville, Kendall County, Illinois
(the "City"), which upon acceptance by the City will be binding upon each of the City and the
Underwriter. Capitalized terms used herein and not otherwise defined herein shall have the
meanings set forth in the Indenture (as hereinafter defined) and the Official Statement (as
hereinafter defined).
This offer is made subject to acceptance by the City on or before 1:00 P.M., Chicago time,
on the date hereof, and, if not so accepted, will be subject to withdrawal by the Underwriter upon
notice delivered to the City at the address set forth above at any time prior to the acceptance hereof
by the City. This offer is also subject to the following provisions:
1. Definitions.
For purposes of this Contract, the following terms have the meanings specified in this
section, unless another meaning is plainly intended:
(A) "Act" means the Special Service Area Tax Law of the State of Illinois, 35
ILCS 200/27-5 et seq., as amended.
(B) "Administrative Services Agreement" means the Administrative Services
Agreement dated , 2024, between the City and DTA.
(C) "Ancillary Documents" means the Establishing Ordinance, the Bond
Ordinance, the Bond Order, the Indenture, the Tax Certificate, the Official Statement, the
Continuing Disclosure Agreement, the Administrative Services Agreement and all other
agreements and certificates executed and delivered in connection with the issuance and sale of the
Bonds.
(D) "Area" means the United City of Yorkville Special Service Area Number
2004-107 created pursuant to the Establishing Ordinance.
(E) "Bond Insurer"means
4859-0325-5201.4
(F) "Bond Insurance Policy" means the bond insurance policy relating to the
Bonds substantially in the form attached as an Appendix to the Official Statement.
(G) "Bond Ordinance" means Ordinance No. 2024-_ of the City adopted at a
meeting of the corporate authorities of the City on , as relating to the Bonds, as
amended including the Bond Order executed pursuant thereto.
(H) "Bonds" means the interest-bearing, tax exempt obligations issued by the
City pursuant to the Bond Ordinance and called the United City of Yorkville, Kendall County,
Illinois, Special Service Area No. 2004-107 Special Tax Refunding Bonds, Series 2024 (Raintree
Village II Project).
(I) "Business Day"means any day other than a Saturday, Sunday, legal holiday
or a day on which banking institutions are required or authorized by law to be closed in the City
of Chicago or the State of Illinois or a day on which the New York Stock Exchange is closed.
(J) "City" means the United City of Yorkville, Kendall County, Illinois.
(K) "Closing" means the Closing as defined in Section 2(B) herein held on the
Closing Date.
(L) "Closing Date"means ,2024,or such earlier or later date as the
City and the Underwriter shall mutually agree upon and refers to the date on which the transaction
by which the City causes the Trustee to deliver the Bonds to the Underwriter and the Bonds are
paid for by the Underwriter pursuant to this Contract.
(M) "Code" means the Internal Revenue Code of 1986, as amended.
(N) "Continuing Disclosure Agreement" means the Continuing Disclosure
dated the date of the Closing Date between the City and Amalgamated Bank of Chicago.
(0) "Contract"means this Bond Purchase Agreement.
(P) "Establishing Ordinance"means Ordinance No. No. 2005-90, adopted at a
meeting held on November 22, 2005, by the corporate authorities of the City for Special Service
Area Number 2004-107.
(Q) "Governmental Body" means any federal, state, municipal, or other
governmental department, commission, board, bureau, agency or instrumentality, domestic or
foreign.
(R) "Indenture" means the Trust Indenture dated as of 1, 2024
between the City and the Trustee and any amendments and supplements thereto,pursuant to which
the Bonds will be issued.
(S) "Official Statement" means the Official Statement of the City (including
each Appendix thereto)relating to the Bonds.
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4859-0325-5201.4
(T) "Pledged Funds" mans the Special Tax and the moneys and funds pledged
to the payment of the Bonds pursuant to the Bond Ordinance and Indenture.
(U) "Preliminary Official Statement" means the Preliminary Official Statement
of the City (including each Appendix thereto) relating to the Bonds dated , 2024.
(V) "Prior Bonds" means the $9,400,000 Special Service Area Number 2004-
107 Special Tax Bonds, Series 2005 (Raintree Village II Project).
(W) "Reserve Fund Surety Policy"means the Reserve Fund Surety Policy issued
by the Bond Insurer for deposit to the credit of the Reserve Fund
(X) "Special Tax Roll and Report" means the SSA Number 2004-107 Special
Tax Roll.
(Y) "Tax Certificate"means the Tax Certificate as to Arbitrage and Compliance
with Provisions of Section 103(a) of the Internal Revenue Code of 1986, as amended, dated the
Closing Date,executed by the City and the Trustee in connection with the Bonds and the refunding
of the Prior Bonds.
(Z) "Trustee" means Amalgamated Bank of Chicago, as Trustee under the
Indenture.
(AA) "Underwriter"means D.A. Davidson& Co.
2. Purchase and Sale of the Bonds.
(A) Sale of Bonds. Upon the terms and conditions and upon the basis of the
representations,warranties and agreements herein,the Underwriter hereby agrees to purchase from
the City, and the City hereby agrees to sell to the Underwriter for such purpose, all, but not less
than all, of the $ aggregate principal amount of the Bonds, at a purchase price equal
to $ ,representing the principal amount of the Bonds of$ plus net original
issue premium of$ less Underwriter's discount of$ . The Bonds shall be
issued pursuant to the Bond Ordinance and the Indenture. The Bonds shall be dated, shall mature
on such dates and in such amounts, shall bear interest at such rates, shall be offered at the initial
offering prices as described in Schedule I attached hereto, and shall be subject to such other terms
and conditions, all as described in the Official Statement,the Bond Ordinance and the Indenture.
(B) Closing. The purchase and sale of the Bonds shall take place on the Closing
Date at the offices of Saul Ewing, LLP, Chicago, Illinois. At the Closing, as defined below, the
Underwriter will accept the delivery of the Bonds duly executed by the City, together with other
documents herein mentioned, and will make payment therefor as provided here in by immediately
available funds payable to the order of the Trustee for the account of the City. The payment for
the Bonds and delivery of the Bonds, as herein described, is herein called the "Closing."
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4859-0325-5201.4
3. City's Pre-Closing Deliveries.
(A) Prior to the Closing Date, the City shall have delivered or caused to be
delivered to the Underwriter an executed copy of the Official Statement, executed on behalf of the
City by its Mayor.
(B) Prior to the Closing Date, the City shall have delivered or caused to be
delivered to the Underwriter a certified copy of the Establishing Ordinance, the Bond Ordinance,
and such other ordinances of the City which shall include the authorization of the execution,
delivery and performance of this Contract,the Bonds and the other Ancillary Documents to which
the City is a party, among other things,together with such reasonable number of copies of each of
the foregoing as the Underwriter shall request.
(C) The City hereby authorizes any and all of the material described above in
Subsections A and B of this Section 3 and the Ancillary Documents, the information contained in
the Official Statement and the Bond Ordinance and all other instruments, documents and
agreements delivered pursuant to Section 8 of this Contract or in connection with the transactions
contemplated hereby, for use in connection with the offering and sale of the Bonds. The City
hereby ratifies, approves, and consents to the use and distribution by the Underwriter, prior to the
date hereof, of the Preliminary Official Statement and hereby ratifies, approves and consents to
the use of the Official Statement after the date hereof in connection with the offering and sale of
the Bonds. The City deems final the Preliminary Official Statement for purposes of Rule 15c2-12
of the Securities Exchange Act of 1934, as amended. The City hereby agrees to furnish such
information, execute such instruments and take such other action at the expense of and in
cooperation with the Underwriter as the Underwriter may deem reasonably necessary in order to
qualify the Bonds for offering and sale under the "Blue Sky" or other securities laws and
regulations of such states and other jurisdictions of the United States as the Underwriter may
designate; provided, however, that the City shall not be required to execute a special or general
consent to service of process or qualify as a foreign corporation in connection with any such
qualification in any jurisdiction.
4. Representations and Warranties of the City.
The City represents and warrants to and agrees with the Underwriter that:
(A) City. The City is a non-home rule unit, municipal corporation duly
organized and validly existing and is in good standing under the laws and the Constitution of the
State of Illinois. The City is authorized and empowered by the Act and the Bond Ordinance and
such other ordinances of the City as have been duly adopted by the City, to enter into the
transactions contemplated by this Contract, the Bond Ordinance, the Official Statement, and the
Ancillary Documents to which the City is or is to be a party. The adoption of each of the Bond
Ordinance and the Establishing Ordinance and the execution, delivery and performance by the
City of this Contract, the Ancillary Documents to which the City is or is to be a party and the
issuance of the Bonds are within the legal right, power and authority of the City, have been duly
and validly authorized by all necessary proceedings of the City, and such execution, delivery and
performance by the City as of the date of this Contract and as of the Closing Date do not and will
not contravene,or constitute a breach of or default(with due notice or the passage of time or both)
4
4859-0325-5201.4
under,any provision of law, ordinance or regulation applicable to the City, or any provision of the
municipal code or other rules and procedures of the City, or any judgment, order, decree,
agreement or instrument binding on it or, except as described in the Official Statement, result in
the creation of any lien or other encumbrance on any asset of the City. This Contract and the Bond
Ordinance each constitute, and the Ancillary Documents to which the City is or is to be a party,
when executed and delivered by the City and any other parties thereto, will constitute valid and
binding agreements of the City enforceable against the City in accordance with their respective
terms, except to the extent limited by bankruptcy, reorganization, or other similar laws affecting
creditors' rights generally and by the availability of equitable remedies, and the Bonds, when
issued and delivered by the City in accordance with this Contract and the Bond Ordinance, will
have been duly authorized and issued and will constitute valid and binding obligations of the City
enforceable against the City in accordance with their terms, except to the extent limited by
bankruptcy, reorganization, or other similar laws affecting the enforcement of creditors' rights
generally and by the availability of equitable remedies. When delivered to and paid for by the
Underwriter at the Closing in accordance with the provisions of this Contract, the Bonds will
conform in all material respects to the description thereof contained in the Official Statement.
(B) Use of Proceeds. The City will not take or omit to take any action which
will in any way cause or result in the proceeds from the sale of the Bonds being applied other than
as provided in the Bond Ordinance or the Indenture and as described in the Official Statement.
Such proceeds will not be used by the City in a manner that would cause the Bonds or the Prior
Bonds to be "arbitrage bonds" within the meaning of the Code, or any successor thereto, and the
applicable regulations promulgated or proposed thereunder.
(C) Governmental Authorization. All authorizations,consents and approvals of
any Governmental Body required in connection with the execution and delivery by the City of, or
in connection with the performance by the City of its obligations under, the Bonds, the Bond
Ordinance and the Establishing Ordinance,this Contract,or the Ancillary Documents to which the
City is or is to be a party, have been obtained and are in full force and effect, or will be obtained
prior to Closing and will be in full force and effect as of the Closing Date.
(D) Official Statement. The descriptions and information contained in the
Preliminary Official Statement and in the Official Statement under the captions
"INTRODUCTORY STATEMENT," "THE BONDS" (other than information under the sub-
caption"- Book Entry Only System"),"PLAN OF FINANCE,""SECURITY AND SOURCE OF
PAYMENT FOR THE BONDS" (other than information under the sub-caption "- Value to Lien
Ratio"), "THE AREA." "THE CITY," "THE SPECIAL SERVICE AREA AND THE SPECIAL
TAX," "LEGAL OPINIONS," "CONTINUING DISCLOSURE," "NO LITIGATION," "BOND
RATING," "MISCELLANEOUS" and "AUTHORIZATION" and in Appendices A, B and D
thereto (collectively, the "City Information") are, and as of the date of the Closing, will be, true
and correct in all material respects and such descriptions and information in the Official Statement,
as of its date and as of the Closing Date will not contain an untrue, incorrect or misleading
statement of a material fact; and such descriptions and information in the Official Statement do
not,as of its date and as of the Closing Date will not omit to state a material fact necessary to make
the statements made therein, in the light of the circumstances under which they were made, not
misleading.
5
4859-0325-5201.4
(E) No Liens or Encumbrances. Other than as specifically set forth in the
Official Statement,there are no existing liens,claims, charges or encumbrances on or rights to any
funds, revenues or interests pledged pursuant to the Bond Ordinance and the Indenture which are
senior to, or on a parity with, the claims of the holders of the Bonds. Other than as specifically
disclosed in the Official Statement, the City has not entered into any contract or arrangements of
any kind, and there is no existing, pending, threatened, or anticipated event or circumstance that
might give rise to any lien, claim, charge or encumbrance on or right to the assets, properties,
funds,or interests pledged pursuant to the Bond Ordinance and the Indenture which would be prior
to, or on a parity with, the claims of the holders of the Bonds. The City is lawfully entitled to
receive,pledge and assign all amounts or revenues which have been pledged or assigned as security
for the payment of the principal of and interest on the Bonds.
(F) No Litigation. Except as described in the Official Statement, as of the date
of this Contract and as of the Closing Date (i)there is no action, suit, proceeding or investigation,
at law or in equity, before or by any court or any governmental agency or public board or body,
pending against the City or, to the knowledge of the City, threatened against the City, to restrain
or enjoin,or threatening or seeking to restrain or enjoin,the issuance, sale or delivery of the Bonds
or the delivery by the City of any of the Ancillary Documents to which the City is a party, or the
collection of Pledged Funds, or in any way contesting or affecting the validity of the Bonds or the
Prior Bonds, or any of the Ancillary Documents to which the City is a party, or in any way
questioning or affecting (w)the proceedings under which the Bonds are to be issued or the Prior
Bonds were issued, (x)the validity or enforceability of any provision of the Bonds, the Bond
Ordinance and the Establishing Ordinance or this Contract or any Ancillary Documents, (y) the
authority of the City to collect the Pledged Funds, or to perform its obligations hereunder or with
respect to the Bonds or the Prior Bonds, or to consummate any of the transactions set forth in the
Ancillary Documents to which it is or is to be a party as contemplated hereby or by the Bond
Ordinance, the Indenture, or the Official Statement, (z) the legal existence of the City, or the title
of its Mayor, Aldermen or officers to their offices, and (ii) there is no action, suit, proceeding or
investigation, at law or in equity, before or by any court or any governmental agency or public
board or body, pending against the City or, to the knowledge of the City, threatened against the
City, involving any of the property or assets within the City, which may result in any material
adverse change in the Pledged Funds, assets or the financial condition of the City.
(G) Certificates. Any certificate signed by an authorized officer of the City and
delivered to the Underwriter and/or the Trustee shall be deemed a representation and covenant by
the City to the Underwriter and/or the Trustee as to the statements made therein.
(H) The Ordinances. Each of the Bond Ordinance and the Establishing
Ordinance is in full force and effect, and has not been amended, modified, revoked or repealed.
[The City covenants to adopt an abatement ordinance abating the Special Tax levied to pay the
Prior Bonds at the first meeting held subsequent to the issuance of the Bonds and to file such
abatement ordinance with the County Clerk of Kendall County.]
6
4859-0325-5201.4
5. Reserved.
6. Representations, Warranties and Agreements of the Underwriter.
The Underwriter represents and warrants to and agrees with the City that:
(A) Public Offering. The Underwriter intends to make a bona fide initial public
offering of all the Bonds at prices no higher than, or yields not lower than, those shown in the
Official Statement. The Underwriter reserves the right to lower such initial offering prices as it
deems necessary in connection with the marketing of the Bonds. The Underwriter may offer and
sell the Bonds to certain dealers (including dealers depositing the Bonds into investment trusts)
and others at prices lower than the initial public offering price or prices set forth in the Official
Statement. The Underwriter also reserves the right to: (i) over-allot or effect transactions which
stabilize or maintain the market price of the Bonds at levels above those that might otherwise
prevail in the open market and(ii)discontinue such stabilizing, if commenced,at any time without
prior notice.
(B) Official Statement. The descriptions and information contained in the
Official Statement under the caption "UNDERWRITING" are, and as of the date of the Closing
will be, true and correct in all material respects and such descriptions and information in the
Official Statement, as of its date and as of the Closing Date, will not contain an untrue, incorrect
or misleading statement of a material fact; and such descriptions and information in the Official
Statement do not, as of its date and as of the Closing Date will not omit to state a material fact
necessary to make the statements made therein, in the light of the circumstances under which they
were made, not misleading.
7. Termination of the Purchase Contract.
The Underwriter shall have the right to cancel Underwriter's obligations to purchase the
Bonds, if, between the date hereof and the date of Closing, (i) legislation shall be enacted, or
actively considered for enactment,by the Congress or recommended by the President of the United
States to the Congress for passage, or favorably reported for passage to either House of the
Congress by any committee of such House to which such legislation has been referred for
consideration, a decision by a court of the United States or the United States Tax Court shall be
rendered, or a ruling, regulation or Official Statement by or on behalf of the Treasury Department
of the United States, the Internal Revenue Service or other agency or department of the United
States shall be made or proposed to be made which has the purpose or effect, directly or indirectly,
of imposing federal income taxes upon interest on the Bonds; (ii) any other action or event shall
have transpired which has the purpose or effect, directly or indirectly, of materially adversely
affecting the federal income tax consequences of any of the transactions contemplated in
connection herewith or contemplated by the Official Statement, or, in the reasonable opinion of
the Underwriter,such action or event pertaining to the federal income tax consequences referenced
above materially adversely affects the market for the Bonds or the sale, at the contemplated
offering price or prices (or yield or yields),by the Underwriter of the Bonds; (iii) legislation shall
be enacted,or actively considered for enactment by the Congress,with an effective date on or prior
to the date of Closing, or a decision by a court of the United States shall be rendered, or a ruling
or regulation by the Securities and Exchange Commission or other governmental agency having
7
4859-0325-5201.4
jurisdiction over the subject matter shall be made, the effect of which is that(A)the Bonds are not
exempt from the registration, qualification or other requirements of the Securities Act of 1933, as
amended and as then in effect, or the Securities Exchange Act of 193 4,as amended and as then in
effect,or(B)the Indenture is not exempt from the registration, qualification or other requirements
of the Trust Indenture Act of 1939, as amended and as then in effect; (iv) a stop order, ruling or
regulation by the Securities and Exchange Commission shall be issued or made,the effect of which
is that the issuance, offering or sale of the Bonds, as contemplated herein and in the Official
Statement, is in violation of any provision of the Securities Act of 1933, as amended and as then
in effect, the Securities Exchange Act of 1934, as amended and as then in effect, or the Trust
Indenture Act of 1939, as amended and as then in effect; (v)there shall occur any event which in
the reasonable judgment of the Underwriter either (A) makes untrue, incorrect or misleading in
any material respect any statement or information contained in the Official Statement or(B) is not
reflected in the Official Statement but should be reflected therein in order to make the statements
and information contained therein not misleading in any material respect and, in either such event,
the City refuses to permit the Official Statement to be supplemented to correct or supply such
statement or information, or the effect of the Official Statement as so corrected or supplemented
is such as, in the reasonable judgment of the Underwriter, would materially adversely affect the
market for the Bonds or the sale, at the contemplated offering price, by the Underwriter of the
Bonds; (vi) there shall occur any outbreak of hostilities or any regional, national or international
calamity or crisis or a financial crisis and the effect is such as, in the reasonable judgment of the
Underwriter,would materially adversely affect the market for or the marketability of the Bonds or
obligations of the general character of the Bonds; (vii)a general suspension of trading on the New
York Stock Exchange is in force; (viii) a general banking moratorium is declared by federal or
state authorities;(ix)there occurs any material adverse change in the affairs,operations or financial
conditions of the City,except as set forth or contemplated in the Official Statement;(x)the Official
Statement is not executed, approved and delivered in accordance with Section 3 above; (xi) in the
reasonable judgment of the Underwriter, the market price of the Bonds, or the market price
generally of obligations of the general character of the Bonds,might be adversely affected because:
(A)additional material restrictions not in force as of the date hereof shall have been imposed upon
trading in securities generally by any governmental authority or by any national securities
exchange, or the New York Stock Exchange or other national securities exchange, or any
governmental authority, shall impose, as to the Bonds or similar obligations, any material
restrictions not now in force, or increase materially those now in force, with respect to the
extension of credit by, or the charge to the net capital requirements of, underwriters; (xii) a war
involving the United States of America shall have been declared, or any conflict involving the
armed forces of any country shall have escalated, or any other international, national or regional
emergency relating to or affecting the effective operation of government or the financial
community shall have occurred, which, in the reasonable judgment of the Underwriter, materially
adversely affects the market for the Bonds or of obligations of the general character of the Bonds;
(xiii)any litigation shall be instituted, pending or threatened to restrain or enjoin the issuance, sale
or delivery of the Bonds or in any way protesting or affecting any authority for or the validity of
the Bonds, the Bond Ordinance, the existence or powers of the City, or any event described or
contemplated by the Official Statement; (xiv) there shall have occurred a default with respect to
the debt obligations of, or the institution of proceedings under any federal bankruptcy laws by or
against, any state of the United States or any city or political subdivision of any state, the effect of
8
4859-0325-5201.4
which, in the reasonable judgment of the Underwriter,would materially adversely affect the ability
of the Underwriter to market the Bonds.
8. Conditions of Closing.
The Underwriter's obligation to purchase the Bonds under this Contract is subject to the
performance by the City of its obligations hereunder at and prior to the Closing Date, to the
accuracy, in the reasonable discretion of the Underwriter, of the representations and warranties of
the City contained herein as of the Closing Date, and, in the reasonable discretion of the
Underwriter, to the following conditions, including the delivery of such documents as are
enumerated herein in form and substance satisfactory to the Underwriter and its counsel as of the
Closing Date:
(A) Ordinances in Effect and City in Compliance Therewith. At the time of the
Closing (i) each of the Bond Ordinance and the Establishing Ordinance shall be in full force and
effect, and shall not have been amended, modified or supplemented since the date hereof, except
as may have been agreed to in writing by the Underwriter, and the City shall have duly adopted
and there shall be in full force and effect such additional ordinances or agreements as shall be, in
the opinion of Bond Counsel, necessary in connection with the transactions contemplated hereby
and (ii)the City shall perform or have performed all of its obligations required under or specified
in this Contract with regard to the Bonds or the Bond Ordinance to be performed at,simultaneously
with or prior to the Closing.
(B) Opinions of Bond Counsel. The Underwriter shall have received an
unqualified approving legal opinion substantially in the form of Appendix C to the Official
Statement and a supplemental legal opinion substantially in the form of Exhibit A hereto, each
dated the Closing Date, from Saul Ewing, LLP, Bond Counsel, satisfactory to the Underwriter in
its reasonable discretion.
(C) Opinion of Underwriter's Counsel. The Underwriter shall have received an
opinion dated the Closing Date, addressed to the Underwriter, from Foley & Lardner LLP,
satisfactory to the Underwriter in its reasonable discretion.
(D) Opinion of Counsel to the City. The Underwriter shall have received a
favorable opinion dated the Closing Date, addressed to the Underwriter, Bond Counsel and the
Trustee,from Ottosen DiNolfo Hasenbalg&Castaldo, Ltd.,counsel to the City, satisfactory to the
Underwriter in its reasonable discretion, substantially in the form of Exhibit B hereto.
(E) Continuing Disclosure. An executed copy of the Continuing Disclosure
Agreement substantially in the form attached to the Official Statement shall have been executed
and delivered by the City and the Dissemination Agent named therein.
(F) Performance: No Default. The City shall have performed and complied
with all agreements and conditions herein required to be performed or complied with by the City
prior to or on the Closing Date, and at the time of the Closing no event of default or default shall
have occurred and be continuing with respect to the Ancillary Documents or the Bonds.
9
4859-0325-5201.4
(G) Ancillary Documents. At the Closing Date, (i) all of the Ancillary
Documents shall be in full force and effect, shall have been duly executed and copies delivered to
the Underwriter by, and shall constitute valid and binding agreements of, the parties thereto, shall
not have been amended, modified or supplemented except as may have been agreed to in writing
by the Underwriter and there shall be no defaults or events of default thereunder and (ii) the
proceeds of the sale of the Bonds shall be applied or deposited with the Trustee for application as
described in the Bond Ordinance,the trust indenture for the Prior Bonds and the Official Statement.
(H) Closing Certificate of City. The City shall have delivered to the
Underwriter a certificate dated the Closing Date, addressed to the Underwriter and the Trustee
signed by the Mayor in form and substance reasonably satisfactory to the Underwriter.
(I) The Bonds. The Bonds shall have been duly authorized, executed,
authenticated, delivered, and the proceeds from the sale thereof applied, in accordance with the
provisions of the Bond Ordinance and the Indenture
(J) Trustee's Certificate. The Underwriter shall have received a certificate
dated the Closing Date of an authorized officer of the Trustee, addressed to the Underwriter
reasonably acceptable in form and substance to the Underwriter.
(K) Form 8038-G. The Underwriter shall have received a copy of the completed
Form 8038-G of the Internal Revenue Service executed by the City.
(L) Officers' Certificates. The Underwriter shall have received any and all
certificates required to be furnished by the provisions of any Ancillary Document to be obtained
or furnished by the City at or prior to Closing.
(M) Specimen Bonds. The Underwriter shall have received specimen Bonds.
(N) Certified Copies of Ordinances. The Underwriter shall have received
certified copies of the Bond Ordinance and the Establishing Ordinance. The Bond Ordinance shall
include authorization for execution and delivery of this Contract. The Bond Ordinance shall have
been filed with the County Clerk of Kendall County. The form of an abatement ordinance abating
the Special Tax levied for the Prior Bonds shall be delivered to the Underwriter.
(0) Bond Insurance Policy and Reserve Fund Policy. The Underwriter shall
have received evidence of the issuance of the Bond Insurance Policy in the form of the specimen
policy attached as Appendix C to the Official Statement and the Reserve Fund Policy, in form and
substance satisfactory to the Underwriter, which Bond Insurance Policy and the Reserve Fund
Policy shall be in full force and effect as of the Closing.
(P) Opinion of Bond Insurer's Counsel. The Underwriter shall have received
an opinion of counsel to the Bond Insurer, dated the date of the Closing and addressed to the City
and the Underwriter regarding the validity of the Bond Insurance Policy and Reserve Fund Policy
and the accuracy and completeness of the Official Statement as to the Bond Insurer.
(Q) Special Tax Roll and Report. The Underwriter shall have received a copy
of the Special Tax Roll and Report substantially in the form attached to the Official Statement.
10
4859-0325-5201.4
(R) Special Tax Roll and Report Consent. The Underwriter shall have received
from the preparer of the Special Tax Roll and Report a letter dated the Closing Date, addressed to
the Underwriter regarding such preparer's qualifications and the preparer's consent to the inclusion
of the Special Tax Roll and Report in the Official Statement.
(S) Ratings. The Underwriter shall have received evidence that the Bonds have
received an insured rating of" " from Standard & Poor's Ratings Group.
(T) Additional Opinions, Certificates,etc. The Underwriter shall have received
such additional legal opinions, certificates, proceedings, instruments and other documents as the
Underwriter,the City or their respective counsel may deem reasonably necessary or desirable. All
of the opinions, letters, certificates, instruments and other documents mentioned in this Contract
shall be deemed to be in compliance with the provisions of this Contract only if in the reasonable
judgment of the Underwriter,they are satisfactory in form and substance. If there shall be a failure
to satisfy the conditions of the Underwriter's obligations contained in this Contract or if the
Underwriter's obligations to purchase the Bonds shall be terminated for any reason permitted by
this Contract, this Contract shall terminate, and the Underwriter and the City shall not have any
further obligations hereunder, except for the obligations set forth in Section 10 hereof which shall
remain in full force and effect.
9. Changes Affecting the Official Statement.
At any time prior to the Closing, the City agrees to supplement or amend the Official
Statement whenever requested by the Underwriter when, in the reasonable judgment of the
Underwriter and the City, such supplement or amendment is required. No amendment or
supplement to the Official Statement shall be made without the approval of the Underwriter. After
the Closing and so long as the Underwriter or any participating dealer shall be offering Bonds, but
not later than 90 days after the date of this Contract, if any event shall occur as a result of which it
is necessary to amend or supplement the Official Statement in order to make the statements therein,
in light of the circumstances under which they are mad, e not misleading, the City will so advise
the Underwriter. In any such case, the City shall cooperate in the preparation, execution and
delivery of either amendments to the Official Statement or supplemental information so that the
statements in the Official Statement, as so amended or supplemented will not, in light of the
circumstances under which such statements were made,be misleading. The cost of providing such
amendments or supplements shall be paid by the City which costs may be reimbursed from
amounts made available under the Bond Ordinance and the Indenture as Administrative Costs.
10. Payment of Expenses.
All fees, costs and expenses associated with the issuance of the Bonds, including without
limitation, the reasonable fees and disbursements of the preparer of the Special Tax Report, the
Underwriter's legal counsel, Foley & Lardner LLP, Bond Counsel, Saul Ewing, LLP, and the
City's counsel, Ottosen DiNolfo Hasenbalg & Castaldo, Ltd., shall be disbursed and paid by the
Trustee from the proceeds of the Bonds.
1 1
4859-0325-5201.4
11. Notices.
Except as otherwise provided in this Contract, whenever notice is required to be given
pursuant to the provisions of this Contract, such notice shall be in writing and may be given by
personal or courier delivery, registered or certified mail, facsimile transmission or electronic
communication, provided that delivery by facsimile transmission or electronic communication
must be confirmed by the sender.
12. Law Governing.
This Contract shall be construed in accordance with and governed by the laws of the State
of Illinois.
13. Headings.
The headings of the paragraphs and subparagraphs of this Contract are inserted for
convenience only and shall not be deemed to constitute a part of this Contract.
14. Counterparts.
This Contract may be signed in any number of counterparts, each of which shall be an
original,with the same effect as if the signatures thereto and hereto were upon the same instrument.
15. Parties and Interests.
This Contract is made solely for the benefit of the City and the Underwriter, including the
successors and assigns of the Underwriter, and no other person, partnership, association or
corporation shall acquire or have any rights hereunder or by virtue hereof.
16. Reserved.
17. Further Financial Reports. The City agrees to provide the financial reports and
information described in the Indenture which it has covenanted to provide to the Trustee, to the
Underwriter, the Bond Insurer and any Bondholder upon written request.
18. Amendment or Assignment.
This Contract may not be amended except through the written consent of all of the parties
hereto and is not assignable.
19. Survival of Representations, Warranties and Agreements.
All representations, warranties and agreements contained in this Agreement shall remain
operative and in full force and effect, regardless of any investigation made by or on behalf of the
Underwriter and shall survive the delivery of and payment for the Bonds and any termination of
this Agreement.
12
4859-0325-5201.4
20. Severability.
If any provision of this Contract shall be held or deemed to be or shall, in fact, be
inoperative or unenforceable as applied in any particular case in any jurisdiction or jurisdictions,
or in all cases because it conflicts with any other provision or provisions or any constitution or
statute or rule of public policy,or for any other reason, such circumstances shall not have the effect
of rendering the provision in question inoperative or unenforceable in any other case or
circumstance, or of rendering any other provision or provisions herein contained invalid,
inoperative, or unenforceable to any extent whatever. The invalidity of any one or more phrases,
sentences,clauses or sections in this Contract shall not affect the validity of the remaining portions
of this Contract, or any part hereof.
21. Underwriter Not an Agent or Fiduciary.
(A) The City has received and reviewed the disclosure letter January 4, 2024,
that is required by the Municipal Securities Rulemaking Board ("MSRB") Rule G-17 as set forth
in MSRB Notice 2012-25 (May 7, 2012).
(B) (i)The purchase and sale of the Bonds pursuant to this Contract is an arm's
length commercial transaction between the City and the Underwriter; (ii) in connection with the
purchase and sale of the Bonds and with the discussions, undertakings and procedures leading up
to the consummation of such transaction, the Underwriter is and has been acting solely as a
principal and is not acting as an agent, advisor or fiduciary of the City; and (iii) the City has
consulted its own legal, financial and other advisors to the extent it has deemed appropriate.
22. Establishment of Issue Price.
(a) The Underwriter agrees to assist the City in establishing the issue price of the Bonds,
and shall execute and deliver to the City at Closing "issue price" or similar certificates, together
with the supporting pricing wires or equivalent communications,substantially in the form attached
hereto as Exhibit C (the"Issue Price Certificate"),with such modifications as may be appropriate
or necessary, in the reasonable judgment of the Underwriter, the City and Bond Counsel, to
accurately reflect,as applicable,the sales price or prices or the initial offering price or prices to the
public of the Bonds.
(b) The City will treat the first price at which ten percent(10%)of each maturity of the
Bonds(the"10% Test") is sold to the public as the issue price of that maturity (if different interest
rates apply within a maturity, each separate CUSIP number within that maturity will be subject to
the 10% Test). At or promptly after the execution of this Agreement, the Underwriter shall report
to the City the price or prices at which it has sold to the public each maturity of the Bonds. If at
that time the 10% Test has not been satisfied as to any maturity of the Bonds, the Underwriter
agrees to promptly report to the City the prices at which the Bonds of that maturity have been sold
by the Underwriter to the public. Unless the hold-the-offering-price rule(described below)applies,
that reporting obligation shall continue, whether or not the Closing has occurred, until the 10%
Test has been satisfied as to the Bonds of that maturity or until all the Bonds of that maturity have
been sold to the public.
13
4859-0325-5201.4
(c) The Underwriter confirms that it has offered the Bonds to the public on or before
the date of this Agreement at the offering price or prices (the "initial offering price"), or at the
corresponding yield or yields, set forth in Schedule A on the Issue Price Certificate, except as
otherwise set forth therein. Schedule A on the Issue Price Certificate also sets forth, as of the date
of this Agreement,the maturities, if any,of the Bonds for which the 10%Test has not been satisfied
and for which the City and the Underwriter agree that the restrictions set forth in the next sentence
shall apply, which will allow the City to treat the initial offering price to the public of each such
maturity as of the sale date as the issue price of that maturity (the "hold-the-offering-price rule").
So long as the hold-the-offering-price rule remains applicable to any maturity of the Bonds, the
Underwriter will neither offer nor sell unsold Bonds of that maturity to any person at a price that
is higher than the initial offering price to the public during the period starting on the sale date and
ending on the earlier of the following:
(1) the close of the fifth (5th) Business Day after the sale date; or
(2) the date on which the Underwriter has sold at least ten percent(10%)of that
maturity of the Bonds to the public at a price that is no higher than the initial
offering price to the public.
Unless the hold-the-offering-price rule applies, the Underwriter shall promptly advise the
City when it has sold ten percent (10%) of that maturity of the Bonds to the public at a price that
is no higher than the initial offering price to the public, if that occurs prior to the close of the fifth
(5th) Business Day after the sale date.
(d) The Underwriter acknowledges that sales of the Bonds to any person that is a related
party to the Underwriter shall not constitute sales to the public for purposes of this section. Further,
for purposes of this section:
(1) "public"means any person other than an underwriter or a related party,
(2) "underwriter" means (A) any person that agrees pursuant to a written
contract with the City (or with the lead underwriter to form an underwriting
syndicate)to participate in the initial sale of the Bonds to the public and (B)
any person that agrees pursuant to a written contract directly or indirectly
with a person described in clause (A) to participate in the initial sale of the
Bonds to the public (including a member of a selling group or a party to a
retail distribution agreement participating in the initial sale of the Bonds to
the public),
(3) a purchaser of any of the Bonds is a"related party"to an underwriter if the
underwriter and the purchaser are subject, directly or indirectly, to (i) more
than fifty percent(50%)common ownership of the voting power or the total
value of their stock, if both entities are corporations (including direct
ownership by one corporation of another), (ii)more than fifty percent(50%)
common ownership of their capital interests or profits interests, if both
entities are partnerships (including direct ownership by one partnership of
another), or (iii) more than fifty percent (50%) common ownership of the
value of the outstanding stock of the corporation or the capital interests or
profit interests of the partnership,as applicable, if one entity is a corporation
14
4859-0325-5201.4
and the other entity is a partnership (including direct ownership of the
applicable stock or interests by one entity of the other), and
(4) "sale date"means the date of execution of this Agreement by all parties.
[SIGNATURE PAGE FOLLOWS]
15
4859-0325-5201.4
[SIGNATURE PAGE OF BOND PURCHASE AGREEMENT]
Very truly yours,
D.A. Davidson & Co.
By:
Name:
Title:
Accepted and agreed to by the undersigned as
of the date first above written.
UNITED CITY OF YORKVILLE, an Illinois
municipal corporation
By:
John Purcell, Mayor
4859-0325-5201.4
Schedule I
United City of Yorkville, Kendall County, Illinois
Special Service Area Number 2004-107
Special Tax Refunding Bonds, Series 2024 (Raintree Village II Project)
MATURITY SCHEDULE
Maturity
(March 1) Amount Interest Rates Yield CUSIP*
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
* CUSIP is a registered trademark of the American Bankers Association. CUSIP data is provided by CUSIP Global
Services,which is managed on behalf of the American Bankers Association by S&P Global Market Intelligence. The
CUSIP numbers listed are being provided solely for the convenience of the Bondholders only at the time of sale of
the Bonds and the City does not make any representation with respect to such numbers or undertake any responsibility
for their accuracy now or at any time in the future. The CUSIP number for a specific maturity is subject to being
changed after the sale of the Bonds as a result of various subsequent actions,including,but not limited to,a refunding
in whole or in part of such maturity or as a result of the procurement of secondary market portfolio insurance or other
similar enhancement by investors that is applicable to all or a portion of certain maturities of the Bonds.
[**Yield to first call date of March 1, ]
4859-0325-5201.4
EXHIBIT A
March , 2024
United City of Yorkville
652 Prairie Pointe Drive
Yorkville, Illinois 60560
Amalgamated Bank of Chicago
30 North LaSalle Street
38th Floor
Chicago, Illinois 60602
D.A. Davidson & Co.
227 W. Monroe Street
Suite 5250
Chicago, IL 60606
Re: $ United City of Yorkville, Kendall County, Illinois Special Service
Area Number 2004-107, Special Tax Refunding Bonds, Series 2024 (Raintree
Village II Project)
Ladies and Gentlemen:
We have served as Bond Counsel to the United City of Yorkville, Kendall County, Illinois
(the "City") with respect to the issuance today of the $ United City of Yorkville,
Kendall County, Illinois, Special Service Area Number 2004-107 Special Tax Refunding Bonds,
Series 2024 (Raintree Village II Project) (the "Bonds"). The Bonds are issued pursuant to an
ordinance adopted by the City on March 12, 2024 (the "Bond Ordinance"), a Bond Order of the
City executed pursuant thereto and a Trust Indenture dated as of March 1, 2024 (the "Trust
Indenture") between the City and Amalgamated Bank of Chicago, as trustee.
We have delivered to you an executed copy of our approving opinion, dated today,
addressed to you with respect to the Bonds. Based upon our examination as described in that
opinion,we are further of the opinion that the Bonds are not subject to the registration requirements
of the Securities Act of 1933, as amended, and the Trust Indenture is exempt from qualification
pursuant to the Trust Indenture Act of 1939, as amended.
We are further of the opinion that statements contained in the Official Statement dated
, 2024 relating to the Bonds under the sections entitled "THE BONDS"(other than
information under the subcaption "- Book Entry Only System"as to which no view is expressed);
"SECURITY AND SOURCE OF PAYMENT FOR THE BONDS;"(other than information under
the subcaptions" "Enforcement of Payment of Special Tax," "Value to Lien Ratio,"
"Representative Property Taxes," and"Historical Special Tax Collections and Delinquencies"(as
to which no view is expressed); "THE SPECIAL SERVICE AREA AND SPECIAL TAX"(other
than information under the subcaptions"Levy Abatement and Collection of Special Tax,""Special
Service Area Special Tax Roll and Report"and"Administrative Services,"as to which no view is
expressed), "TAX EXEMPTION," and "CHANGES IN FEDERAL AND STATE TAX LAW"
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4859-0325-5201.4
and in Appendix C - Bond Opinion thereto insofar as the statements contained under such sections
or in such Appendix purport to describe or summarize certain provisions of the Bonds, the Bond
Ordinance, the Establishing Ordinance, and the Trust Indenture, or summarize such opinion,
present an accurate description or summary of such provisions and opinion.
Very truly yours,
SAUL EWING LLP
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4859-0325-5201.4
EXHIBIT B
March , 2024
D.A. Davidson & Co.
222 West Adams Street
Chicago, Illinoi s 60606
Saul Ewing, LLP
161 North Clark Street, Suite 4200
Chicago, Illinois 60601
Amalgamated Bank of Chicago
30 North LaSalle Street
38th Floor
Chicago, Illinois 60602
[Bond Insurer]
Re: $ United City of Yorkville, Kendall County, Illinois Special Service
Area Number 2004-107 Special Tax Refunding Bonds, Series 2024 (Raintree
Village II Project)
Ladies and Gentlemen:
We have served as counsel for the United City of Yorkville, Illinois (the "City") in
connection with the execution and delivery of the Bond Purchase Agreement dated March 2024
(the "Purchase Agreement") by and between the City and D.A. Davidson & Co. (the
"Underwriter") providing for the purchase by the Underwriter of the United City of Yorkville,
Kendall County, Illinois, Special Service Area Number 2004-107 Special Tax Refunding Bonds,
Series 2024 (Raintree Village II Project) (the "Bonds") issued pursuant to a Trust Indenture dated
as of March 1,2024(the"Trust Indenture")between the City and Amalgamated Bank of Chicago,
as trustee. Terms used but not defined herein shall have the meanings ascribed thereto in the
Purchase Agreement. This opinion is being delivered to you at the express direction of the City
and pursuant to the Purchase Agreement.
In such capacity, we have examined the following:
a. the Purchase Agreement;
b. the Preliminary Official Statement of the City dated March , 2024 (the
"Preliminary Official Statement") and the Official Statement of the City dated
March , 2024 relating to the Bonds (the "Final Official Statement", and together
with the Preliminary Official Statement, the "Official Statement");
c. the Trust Indenture;
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4859-0325-5201.4
d. the Continuing Disclosure Agreement dated March , 2024 executed and
delivered by the City;
e. the Tax Certificate dated March_, 2024 (the "Tax Compliance Certificate");
f. The City Ordinance adopted , 2024 relating to the Bonds (the "Bond
Ordinance") and City Ordinance No. 2005-90 adopted November 22, 2005 (the
"Establishing Ordinance"); and
g. The Administrative Services Agreement.
and such other documents as we have deemed necessary to render this Opinion.
As counsel to the City, we advised the City as to applicable requirements and performed
other legal services necessary in order to enable us to render the opinions set forth below.
Additionally, we participated in reviews and discussions with representatives of the Underwriter,
Bond Counsel, and the Trustee relating to the Official Statement.
For the purposes of this opinion, we have assumed that:
a. The execution and delivery of all documents reviewed by us,and the entry into and
performance of the transactions contemplated by the Purchase Agreement and the
Indenture by all parties other than the City have been duly authorized by all
necessary actions and that said agreements constitute the valid and binding
obligations of all parties other than the City.
b. All natural persons who are signatories to the Purchase Agreement, the Continuing
Disclosure Agreement, the Administrative Services Agreement, and the Indenture
on behalf of parties other than the City were legally competent at the time of
execution.
c. All signatures on behalf of parties other than the City on said agreements and other
documents reviewed by us are genuine.
d. The copies of all documents submitted to us are accurate and complete and conform
to originals.
Based upon our familiarity with the City, and the proceedings, showings and related
matters of law with respect to the foregoing, but subject to the assumptions set forth herein,we are
of the opinion that:
1. The City is a municipal corporation duly organized and validly existing under the
laws of the State of Illinois, and has full legal right, power and authority to adopt
the Bond Ordinance and the Establishing Ordinance, and to enter into, execute and
deliver the Purchase Agreement, the Final Official Statement, the Continuing
Disclosure Agreement, the Indenture, the Tax Compliance Certificate and the
Administrative Services Agreement (the foregoing documents are hereafter
collectively referred to as the "City Agreements"), to consummate all transactions
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4859-0325-5201.4
contemplated thereby,and to issue and sell the Bonds for the purposes described in
the Official Statement.
2. Each of the members or officers of the City executing the City Agreements and
other closing documents executed in connection with the delivery of the Bonds has
been authorized to do so.
3. The Establishing Ordinance and the Bond Ordinance were each duly authorized
and adopted by the City at a meeting of the Corporate Authorities of the City,which
was called and held pursuant to law and with the public notice required by law and
at which a quorum was present and acting throughout and each such Ordinance is
in full force and effect, and has not been amended, modified, revoked, repealed or
supplemented since the respective dates thereof.
4. Each of the City Agreements has been duly authorized by all necessary action on
the part of the City, has been duly executed and delivered by authorized officers of
the City and constitute legal, valid and binding obligations of the City enforceable
against the City in accordance with their respective terms, subject to the
qualification that the enforcement thereof may be limited by bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting creditors'
rights and by the availability of equitable remedies.
5. The Final Official Statement has been duly executed and delivered by the City. The
use by the Underwriter of the Official Statement in connection with the offer and
sale of the Bonds has been authorized and ratified by the City.
6. The Bonds have been duly authorized by all necessary action on the part of the City,
have been duly executed by the authorized officers of the City and have been
validly issued by the City and constitute the legal, valid and binding obligations of
the City enforceable against the City in accordance with their terms, subject to the
qualification that the enforcement thereof may be limited by laws relating to
bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights and by the availability of equitable remedies.
7. Other than as set forth in the Official Statement,there is no action, suit,proceeding,
inquiry or investigation, at law or in equity, or by any court, public board or body
pending or, to our knowledge, threatened against or affecting the City, or, to our
knowledge, is there any basis for any such action, suit, proceeding or investigation
in any way (i) contesting or affecting the proceedings under which the Bonds are
to be issued and de liver ed; (ii) contesting or affecting the collection, application
or validity of the Special Tax or the special tax levy; (iii)contesting or affecting the
creation, organization, existence or powers of the City or the Area, or the titles of
the Mayor, Aldermen and officers to their respective offices; (iv) which seeks to
enjoin or restrain the issuance, sale and delivery of the Bonds; (v) questioning or
affecting any of the rights, powers, duties or obligations of the City with respect to
the Special Tax or the monies and assets pledged or to be pledged to pay the
principal of,premium, if any,or interest on the Bonds; (vi)questioning or affecting
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4859-0325-5201.4
any authority for the issuance of the Bonds, or the validity or enforceability of the
Bonds; or(vii) questioning or affecting the City Agreements, the Bond Ordinance,
the Establishing Ordinance or the transactions contemplated by the City
Agreements, the Bond Ordinance or the Establishing Ordinance.
8. The authorization, execution and delivery by the City of the City Agreements do
not, and the compliance with the provisions thereof by the City, under the
circumstances contemplated therein, will not, in any material respect, conflict with
or constitute on the part of the City a breach of or default under any agreement to
which the City is a party under any law, regulation, order, ordinance or consent
decree of any court or governmental tribunal to which the City is subject.
9. The adoption of the Bond Ordinance and the Establishing Ordinance,the execution
and delivery by the City of the Bonds and compliance by the City with the
provisions thereof: under the circumstances contemplated thereby, do not and will
not violate any applicable judgment, order or regulation of any court or of any
public or governmental agency or authority of the State of Illinois and will not
conflict with, or result in a breach of, any of the terms and provisions of, or
constitute a default under, any existing law, court or administrative regulation,
decree, order or any agreement, indenture, mortgage, lease or other instrument to
which the City is subject or by which it is or may be bound.
10. Based upon our familiarity with the City to the extent of our capacity as special
counsel to the City, our involvement in the negotiation of the City Agreements and
the issuance of the Bonds by the City, nothing has come to our attention and we
have no reason to believe that the information contained in the Official Statement
in or under the captions "INTRODUCTORY STATEMENT"; "THE BONDS"
(other than information under the sub-caption "- Book Entry Only System");
"PLAN OF FINANCE"; "SECURITY AND SOURCE OF PAYMENT FOR THE
BONDS" (other than information under the sub-caption "- Value to Lien Ratio");
"THE AREA"; "THE CITY"; "THE SPECIAL SERVICE AREA AND THE
SPECIAL TAX"; "RISK FACTORS - Limited Source of Funds" and "- Loss of
Tax Exemption"; "LEGAL OPINIONS"; "CONTINUING DISCLOSURE"; "NO
LITIGATION";"BOND RATING"and"AUTHORIZATION"and in Appendix B
thereto (except with respect to financial information and statistical data contained
therein, as to which we express no opinion), contains any untrue statement of a
material fact or omits any material fact that is necessary to be stated therein in order
to make the statements therein, in light of the circumstances in which they were
made, not misleading.
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4859-0325-5201.4
This opinion is limited to the matters set forth herein. No opinion may be inferred or
implied beyond the matters expressly contained herein. This opinion is rendered solely for the
benefit of the persons or entities to whom it is addressed and no other person or entity shall be
entitled to rely on any matters set forth herein without the express written consent of the
undersigned.
Very truly yours,
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4859-0325-5201.4
EXHIBIT C
Form of Issue Price Certificate
Issue Price Certificate
United City of Yorkville, Kendall County, Illinois
Special Service Area Number 2004-107
Special Tax Refunding Bonds, Series 2024 (Raintree Village II Project)
March , 2024
The undersigned, on behalf of D.A. Davidson & Co. (the "Underwriter"), hereby certifies
as set forth below with respect to the sale and issuance of the above-captioned obligations (the
"Bonds").
1. Initial Offering Price of the Bonds.
(a) As of the date of this Certificate, for each Maturity of the Bonds the first price at
which at least 10%of such maturity was sold to the Public is at the respective initial offering prices
listed in Schedule A (the "Initial Offering Prices"). A copy of the pricing wire or equivalent
communication for the Bonds is attached to this certificate as Schedule B.
2. Yield on the Bonds. As shown on the attached Schedules, the yield on the Bonds
has been calculated to be %. Such calculations were made using software licensed to the
Underwriter by a third party vendor.
3. Defined Terms.
(a) Holding Period means, with respect to each Maturity of the Bonds, the period
starting on the Sale Date and ending on the earlier of(i)the close of the fifth business day after the
Sale Date, or(ii) the date on which the Underwriter has sold at least 10%of such Maturity of the
Bonds to the Public at a price that is no higher than the Initial Offering Price for such Maturity.
(b) Issuer means the United City of Yorkville, Kendall County, Illinois.
(c) Maturity means Bonds with the same credit and payment terms. Bonds with
different maturity dates, or Bonds with the same maturity date but different stated interest rates,
are treated as separate maturities.
(d) Public means any person (including an individual, trust, estate, partnership,
association, company, or corporation) other than an Underwriter or a related party to an
Underwriter. The term "related party" for purposes of this certificate generally means any two or
more persons who have greater than 50%common ownership, directly or indirectly.
C-1
4859-0325-5201.4
(e) Sale Date means the first day on which there is a binding contract in writing for the
sale of a Maturity of the Bonds. The Sale Date of the Bonds is , 2024.
(f) Underwriter means (i) any person that agrees pursuant to a written contract with
the Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the
initial sale of the Bonds to the Public, and (ii)any person that agrees pursuant to a written contract
directly or indirectly with a person described in clause (i) of this paragraph to participate in the
initial sale of the Bonds to the Public (including a member of a selling group or a party to a retail
distribution agreement participating in the initial sale of the Bonds to the Public).
The representations set forth in this certificate are limited to factual matters only.Nothing
in this certificate represents the Underwriter's interpretation of any laws, including specifically
Sections 103 and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations thereunder. The undersigned understands that the foregoing information will be relied
upon by the Issuer with respect to certain of the representations set forth in the Tax Certificate and
with respect to compliance with the federal income tax rules affecting the Bonds, and by Saul
Ewing LLP, Chicago, Illinois, in connection with rendering its opinion that the interest on the
Bonds is excluded from gross income for federal income tax purposes, the preparation of the
Internal Revenue Service Form 8038-G, and other federal income tax advice that it may give to
the Issuer from time to time relating to the Bonds.
IN WITNESS WHEREOF, the undersigned, on behalf of the Underwriter, has set his or
her hand as of the date first written above.
D.A. DAVIDSON & CO.
By
Name
Title
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4859-0325-5201.4
SCHEDULE A
TO ISSUE PRICE CERTIFICATE
SALE PRICES OF THE ACTUALLY SOLD MATURITIES AND
INITIAL OFFERING PRICES OF THE OFFERED MATURITIES
C-3
4859-0325-5201.4
SCHEDULE B
TO ISSUE PRICE CERTIFICATE
FINAL PRICING FOR THE BONDS
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4859-0325-5201.4
Exhibit D
Form of the Preliminary Official Statement
(See attached)
51642736.6
PRELIMINARY OFFICIAL STATEMENT DATED , 2024
NEW ISSUE-BOOK ENTRY ONLY INSURED INVESTMENT RATING
Standard&Poor's" "
(BAM Insured)
(No Underlying Rating)
In the opinion of Saul Ewing LLP, Bond Counsel, interest on the Bonds is not includable in gross income for purposes of
federal income taxation under existing statutes, regulations, rulings and court decisions,subject to the condition described in "TAX
EXEMPTION"herein and interest on the Bonds is not treated as an item of tax preference for purposes of the federal alternative
minimum tax; however, such interest is taken into account in determining the annual adjusted financial statement income of
applicable corporations (as defined in Section 59(k) of the Internal Revenue Code of 1986, as amended)for the purpose of
computing the alternative minimum tax imposed on corporations for tax years beginning after December 31, 2022. Under existing
law of the State of Illinois, interest on the Bonds is not exempt from Illinois income taxes. For a more complete discussion, see
"TAX EXEMPTION"herein.
$ *
UNITED CITY OF YORKVILLE
Kendall County, Illinois
Special Service Area Number 2004-107
Special Tax Refunding Bonds, Series 2024
(Raintree Village II Project)
Dated: Date of Delivery Due: March 1 as shown on the inside cover
This Official Statement is being furnished in connection with the issuance and sale of the United City of Yorkville, Kendall
County, Illinois, Special Service Area Number 2004-107 Special Tax Refunding Bonds, Series 2024 (Raintree Village II Project)
(the"Bonds"). The Bonds will be secured by a pledge of Special Taxes(as defined herein)and amounts held in certain of the funds
established pursuant to the Trust Indenture dated as of March 1, 2024 (the "Trust Indenture" or"Indenture") between the United
City of Yorkville,Kendall County,Illinois(the"City")and Amalgamated Bank of Chicago,as Trustee(the"Trustee").
The Bonds are issuable only as fully registered bonds without coupons and,when issued,will be registered in the name of Cede
& Co., as nominee of The Depository Trust Company,New York,New York("DTC"). Individual purchases will be made in book
entry form only, in denominations of$5,000 or integral multiples of$1,000 in excess thereof. Beneficial Owners of the Bonds will
not receive physical certificates representing their interest in the Bonds purchased. Principal of, premium, if any, and interest
(payable on March 1 and September 1 of each year, commencing September 1,2024)on the Bonds are payable by the Trustee to
DTC, which will remit such principal, premium, if any, and interest to DTC's Participants, who in turn will be responsible for
remitting such payments to the Beneficial Owners of the Bonds,as described herein.
The Bonds are subject to optional,mandatory and special mandatory redemption prior to maturity as set forth herein.
Concurrently with the issuance of the Bonds, Build America Mutual Assurance Company (the"Bond Insurer") will issue its
Municipal Bond Insurance Policy for the Bonds (the "Bond Policy"). The Bond Policy guarantees the scheduled payment of
principal of and interest on the Bonds when due as set forth in the form of the Bond Policy included as an exhibit to this Official
Statement. The Bond Insurer will also issue its Reserve Fund Surety Policy for fifty percent (50%)of the Reserve Requirement
with respect to the Bonds(the"Reserve Fund Surety Policy")as set forth in the form of the Reserve Fund Surety Policy included as
an exhibit to this Official Statement.
[BOND INSURER LOGO]
The City will use the proceeds of the Bonds to: (i) effect the defeasance and current refunding of the City's Special Service
Area Number 2004-107 Special Tax Bonds, Series 2005(Raintree Village II Project);(ii)fund a portion of a Reserve Fund;(iii)pay
the premiums owed for the Bond Policy and the Reserve Fund Surety Policy;and(iv)pay costs of issuance of the Bonds.See"THE
BONDS."
THE BONDS ARE BEING ISSUED PURSUANT TO THE SPECIAL SERVICE AREA TAX LAW OF THE STATE OF
ILLINOIS, AS AMENDED, AND, IN THE OPINION OF BOND COUNSEL, WILL CONSTITUTE VALID AND LEGALLY
BINDING LIMITED OBLIGATIONS OF THE UNITED CITY OF YORKVILLE, KENDALL COUNTY, ILLINOIS (THE
"CITY"), PAYABLE SOLELY AND ONLY FROM THE SPECIAL TAXES AND AMOUNTS ON DEPOSIT IN CERTAIN OF
THE FUNDS ESTABLISHED AND MAINTAINED PURSUANT TO THE TRUST INDENTURE, AS SET FORTH HEREIN.
THE BONDS ARE NOT GENERAL OBLIGATIONS OF THE CITY AND NEITHER THE FULL FAITH AND CREDIT NOR
THE UNLIMITED TAXING POWER OF THE CITY, THE COUNTY OF KENDALL, THE STATE OF ILLINOIS, OR ANY
*Preliminary,subject to change
4855-1679-8113.6
POLITICAL SUBDIVISION THEREOF IS PLEDGED AS SECURITY FOR THE PAYMENT OF THE BONDS.
NO HOLDER
OF ANY BOND SHALL HAVE THE RIGHT TO COMPEL THE EXERCISE OF ANY TAXING POWER OF THE CITY
(OTHER THAN THE LEVY OF THE SPECIAL TAXES AS DESCRIBED HEREIN) FOR PAYMENT OF THE PRINCIPAL
AMOUNT OF,PREMIUM,IF ANY,OR INTEREST ON THE BONDS.
The Bonds are offered when, as and if issued, subject to prior sale, withdrawal or modification of the offer without notice, the
approving legal opinion of Saul Ewing LLP, Chicago, Illinois, Bond Counsel. Certain legal matters will be passed upon for the
Underwriter by Foley & Gardner LLP, Chicago, Illinois, and for the City by Ottosen DiNolfo Hasenbalg & Castaldo, Ltd.,
Naperville,Illinois. It is expected that the Bonds will be available for delivery through the facilities of DTC in New York, New York
on or about ,2024.
I) A DAVIDSON
PIXEO INCOME CAPITAL MAIEETS
,2024
4855-1679-8113.6
RED HERRING LANGUAGE
This Preliminary Official Statement and the information contained herein are subject to completion,
amendment, or other change without notice. Under no circumstance shall this Preliminary Official
Statement constitute an offer to buy, nor shall there be any sale of these securities in any jurisdiction in
which such offer, solicitation or sale would be unlawful prior to registration or qualification under the
securities laws of any jurisdiction. This Preliminary Official Statement is in a form deemed final by the
City as of this date for purposes of SEC Rule 15c2-12, but is subject to revision, completion and
amendment in a final Official Statement.
4855-1679-8113.6
MATURITIES AND PRINCIPAL AMOUNTS, INTEREST RATES,YIELDS AND
CUSIPs
$ *
UNITED CITY OF YORKVILLE,KENDALL COUNTY, ILLINOIS
SPECIAL SERVICE AREA NUMBER 2004-107
SPECIAL TAX REFUNDING BONDS, SERIES 2024
(RAINTREE VILLAGE II PROJECT)
Maturity Interest
(March 1)* Amount Rates Yield CUSIPt
2025 $ % %
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035 **
* Preliminary,subject to change.
t CUSIP is a registered trademark of the American Bankers Association. CUSIP data is provided by CUSIP
Global Services, which is managed on behalf of the American Bankers Association by S&P Global Market
Intelligence. The CUSIP numbers listed are being provided solely for the convenience of the Bondholders only
at the time of sale of the Bonds and the City does not make any representation with respect to such numbers or
undertake any responsibility for their accuracy now or at any time in the future. The CUSIP number for a
specific maturity is subject to being changed after the sale of the Bonds as a result of various subsequent actions,
including,but not limited to,a refunding in whole or in part of such maturity or as a result of the procurement of
secondary market portfolio insurance or other similar enhancement by investors that is applicable to all or a
portion of certain maturities of the Bonds.
** Yield to first call date of 1,20
4855-1679-8113.6
OFFICIAL STATEMENT
For purposes of compliance with Rule 15c2-12 of the United States Securities and
Exchange Commission, this document constitutes a preliminary official statement of the City,
with respect to the Bonds that has been deemed "final" by the City as of its date, except for the
omission of no more than the information permitted by Rule 15c2-12.
This Official Statement does not constitute an offer to sell or the solicitation of an offer to
buy, nor shall there be any sale of the Bonds by any person, in any jurisdiction in which it is
unlawful for such person to make such an offer, solicitation or sale in such jurisdiction.
No dealer, broker, salesman or other person has been authorized by the City or the
Underwriter to give any information or to make any representation other than as contained in this
Official Statement in connection with the offering described herein, and, if given or made, such
information or representation must not be relied upon as having been authorized. Certain
information contained herein has been obtained from the City, DTC, the municipal bond insurer
and other sources which are believed by the Underwriter to be reliable, but it is not guaranteed as
to accuracy or completeness. In accordance with, and as part of, its responsibilities to investors
under the federal securities laws, as applied to the facts and circumstances of this transaction,the
Underwriter has reviewed the information in this Official Statement but does not guarantee the
accuracy or completeness of such information.Neither the delivery of this Official Statement nor
the sale of any of the Bonds shall imply that the information herein is correct as of any time
subsequent to the date hereof.
This Official Statement should be considered in its entirety and no one factor should be
considered more or less important than any other by reason of its position in this Official
Statement. Where statutes, reports, agreements or other documents are referred to herein,
reference should be made to such statutes, reports, agreements or other documents for more
complete information regarding the rights and obligations of parties thereto, facts and opinions
contained therein and the subject matter thereof.
THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 NOR HAS THE INDENTURE BEEN QUALIFIED UNDER THE TRUST INDENTURE
ACT OF 1939 IN RELIANCE UPON EXEMPTIONS CONTAINED IN SUCH ACTS. THE
REGISTRATION OR QUALIFICATION OF THE BONDS IN ACCORDANCE WITH THE
APPLICABLE PROVISIONS OF SECURITIES LAWS OF THE STATES IN WHICH THE
BONDS HAVE BEEN REGISTERED OR QUALIFIED AND THE EXEMPTION FROM
REGISTRATION OR QUALIFICATION IN OTHER STATES CANNOT BE REGARDED AS
A RECOMMENDATION THEREOF. NEITHER THESE STATES NOR ANY OF THEIR
AGENCIES HAVE PASSED UPON THE MERITS OF THE BONDS OR THE ACCURACY
OR COMPLETENESS OF THIS OFFICIAL STATEMENT. ANY REPRESENTATION TO
THE CONTRARY MAY BE A CRIMINAL OFFENSE.
Build America Mutual Assurance Company ("Bond Insurer") makes no representation
regarding the Bonds or the advisability of investing in the Bonds. In addition, Bond Insurer has
not independently verified, makes no representation regarding, and does not accept any
responsibility for the accuracy or completeness of this Official Statement or any information or
4855-1679-8113.6
disclosure contained herein, or omitted herefrom, other than with respect to the accuracy of the
information regarding Bond Insurer, supplied by Bond Insurer and presented under the heading
"BOND INSURANCE" and "APPENDIX E - Specimen Municipal Bond Insurance Policy" and
"APPENDIX F—Specimen Municipal Bond Debt Service Reserve Insurance Policy."
IN CONNECTION WITH THE OFFERING OF THE BONDS, THE UNDERWRITER
MAY OVERALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN
THE MARKET PRICES OF THE BONDS AT LEVELS ABOVE THOSE WHICH MIGHT
OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF
COMMENCED, MAY BE DISCONTINUED AT ANY TIME WITHOUT NOTICE. THE
PRICES AND OTHER TERMS RESPECTING THE OFFERING AND SALE OF THE
BONDS MAY BE CHANGED FROM TIME TO TIME BY THE UNDERWRITER AFTER
THE BONDS ARE RELEASED FOR SALE, AND THE BONDS MAY BE OFFERED AND
SOLD AT PRICES OTHER THAN THE INITIAL OFFERING PRICES, INCLUDING SALES
TO DEALERS WHO MAY SELL THE BONDS INTO INVESTMENT ACCOUNTS.
There can be no guarantee that there will be a secondary market for the Bonds or, if a
secondary market exists, that it would continue to exist or that the Bonds could in any event be
sold for any particular price.
In connection with the issuance of the Bonds, the City will enter into a Continuing
Disclosure Undertaking with Amalgamated Bank of Chicago. See "CONTINUING
DISCLOSURE" herein.
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS
IN THIS OFFICIAL STATEMENT
Certain statements included in or incorporated by reference in this Official Statement that
are not purely historical are "forward-looking statements" within the meaning of the United
States Private Securities Litigation Reform Act of 1995, Section 21 E of the United States
Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities
Act of 1933, as amended, and reflect the City's current expectations, hopes, intentions, or
strategies regarding the future. Such statements may be identifiable by the terminology used such
as "plan," "expect," "estimate," "budget," "intend" or other similar words. Additionally, all
statements in this Official Statement, including forward-looking statements, speak only as of the
date they are made, and neither the City or the Underwriter undertakes any obligation to update
any statement in light of new information or future events.
THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS
CONTAINED IN SUCH FORWARD-LOOKING STATEMENTS INVOLVES KNOWN
AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY
CAUSE ACTUAL RESULTS, PERFORMANCE, OR ACHIEVEMENTS DESCRIBED
TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS,
PERFORMANCE, OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH
FORWARD-LOOKING STATEMENTS. NEITHER THE CITY OR THE
4855-1679-8113.6
UNDERWRITER NOR ANY OTHER PARTY PLANS TO ISSUE ANY UPDATES OR
REVISIONS TO THOSE FORWARD-LOOKING STATEMENTS IF OR WHEN THEIR
EXPECTATIONS, OR EVENTS, CONDITIONS, OR CIRCUMSTANCES UPON
WHICH SUCH STATEMENTS ARE BASED OCCUR.
4855-1679-8113.6
UNITED CITY OF YORKVILLE, ILLINOIS
MAYOR
JOHN PURCELL
ALDERMEN
Rusty Corneils Matt Marek Craig Soling
Chris Funkhouser Arden Joe Plocher Seaver Tarulis
Ken Koch Daniel Transier
OFFICIALS
Joni Behland Bart Olson
City Clerk City Administrator
•
Ottosen DiNolfo Hasenbalg
Eric Dhuse Rob Fredrickson & Castaldo, Ltd.
Director of Public Works Finance Director/Treasurer City Attorney
PROFESSIONAL SERVICES
BOND COUNSEL
Saul Ewing LLP
Chicago, Illinois
SPECIAL SERVICE AREA
ADMINISTRATOR TRUSTEE
DTA Amalgamated Bank of Chicago
Irvine, California Chicago, Illinois
4855-1679-8113.6
TABLE OF CONTENTS
Page
INTRODUCTORY STATEMENT 1
THE BONDS 2
General Description of the Bonds 2
Redemption 3
Optional Prepayment of Special Tax 5
Book Entry Only System 5
BOND INSURANCE 8
Bond Insurance Policy 8
Build America Mutual Assurance Company 8
RIGHTS OF BOND INSURER 10
PLAN OF FINANCE 11
General 11
Refunding of Prior Bonds 11
Amounts Held for Prior Bonds 11
Estimated Sources and Uses of Funds 12
DEBT SERVICE REQUIREMENTS* 13
ESTIMATED SPECIAL TAX AND DEBT SERVICE COVERAGE* 14
SECURITY AND SOURCE OF PAYMENT FOR THE BONDS 14
General 14
The Special Tax 15
No Additional Bonds 16
Pledged Funds 16
The Reserve Fund Surety Policy 20
Non-Pledged Funds 21
Security for the Bonds 23
Covenants of the City 23
Investment of Funds 24
Enforcement of Payment of Special Tax 25
Value to Lien Ratio 27
Representative Property Taxes 27
Historical Special Tax Collections and Delinquencies 28
THE AREA 29
General 29
Improvements 29
Single Family Homes, Duplexes and Townhomes 30
Water Facilities 30
Sanitary Sewers 30
Storm Water Facilities 30
Other Utilities 30
Flood Plain/Wetlands 30
Schools 31
THE CITY 31
THE SPECIAL SERVICE AREA AND SPECIAL TAX 33
4855-1679-8113.6
The Act 33
Establishment of the Area 34
Levy, Abatement and Collection of Special Tax 34
Special Service Area Special Tax Report 35
Administrative Services 37
RISK FACTORS 38
Limited Source of Funds 38
Information Not Verified 38
Overlapping Indebtedness 38
Tax Delinquencies 39
Potential Delay and Limitations in Foreclosure Proceedings 39
No Acceleration 40
Bankruptcy 40
Maximum Parcel Special Taxes 41
Disclosure to Future Purchasers 41
Limited Secondary Market 41
Secondary Market and Prices 42
Loss of Tax Exemption 42
Risk of Legislative and Judicial Changes 42
Force Majeure Events 42
UNDERWRITING 42
LEGAL OPINIONS 43
TAX EXEMPTION 43
Tax Exemption - Opinion of Bond Counsel 43
Alternative Minimum Tax 44
Deduction for Interest Paid by Financial Institutions to Purchase or Carry Tax-
Exempt Obligations 44
Property or Casualty Insurance Company 44
[Accounting Treatment of Original Issue Discount and Amortizable Bond
Premium 44
Reportable Payments and Backup Withholding 45
CHANGES IN FEDERAL AND STATE TAX LAW 46
CONTINUING DISCLOSURE 46
Continuing Disclosure Undertaking 46
THE UNDERTAKING 47
Corrective Action Related to Certain Bond Disclosure Requirements 48
NO LITIGATION 49
BOND RATING 49
MISCELLANEOUS 49
AUTHORIZATION 51
APPENDICES:
APPENDIX A - Special Tax Report
APPENDIX B - Trust Indenture
APPENDIX C - Bond Opinion
APPENDIX D - Continuing Disclosure Undertaking
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APPENDIX E - Specimen Municipal Bond Insurance Policy
APPENDIX F—Specimen Municipal Bond Debt Service Reserve Insurance Policy
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OFFICIAL STATEMENT
United City of Yorkville,Kendall County, Illinois
Special Service Area Number 2004-107
Special Tax Refunding Bonds, Series 2024
(Raintree Village II Project)
INTRODUCTORY STATEMENT
This Official Statement, which includes the cover page and Appendices attached hereto,
is provided to furnish information in connection with the issuance and sale by the United City of
Yorkville, Kendall County, Illinois (the "City") of$ * aggregate principal amount of
its Special Service Area Number 2004-107 Special Tax Refunding Bonds, Series 2024 (Raintree
Village II Project) (the "Bonds"). The Bonds will be issued by the City pursuant to (i)the Illinois
Constitution of 1970, as amended; (ii) the Special Service Area Tax Law of the State of Illinois,
as amended (the "Special Service Area Act"); (iii) the Illinois Local Government Debt Reform
Act, as amended; (iv) Ordinance No. 2024- of the City adopted at a meeting of the City
Council on March 12, 2024, as supplemented by a Bond Order executed pursuant thereto
(collectively, the "Bond Ordinance") providing for the issuance of the Bonds; and (v) a Trust
Indenture dated as of March 1, 2024 (the "Indenture" or"Trust Indenture") between the City and
Amalgamated Bank of Chicago, Chicago, Illinois, as trustee (the "Trustee"). The Bonds will be
issued as fully registered bonds without coupons in book entry only form in denominations of
$5,000 or any integral multiple of$1,000 in excess thereof.
The Bonds will be secured primarily by the proceeds of the Special Tax (as defined in the
Special Tax Report attached hereto as APPENDIX A and hereafter referred to as the "Special
Tax Report") levied on certain property within the United City of Yorkville Special Service Area
Number 2004-107 (referred to herein as "SSA 2004-107," the "Area" or the "Special Service
Area"). In addition, the Bonds will be payable from and secured by certain funds established
pursuant to the Trust Indenture. Payment of principal of and interest on the Bonds when due will
be insured in accordance with the terms of a municipal bond insurance policy (the "Bond
Policy") to be issued by Build America Mutual Assurance Company (the "Bond Insurer" or
"BAM") for the Bonds. The Bond Insurer will also issue its Reserve Fund Surety Policy for fifty
percent (50%) of the Reserve Requirement (as hereinafter defined) with respect to the Bonds (the
"Reserve Fund Surety Policy"). See "SECURITY AND SOURCE OF PAYMENT FOR THE
BONDS" herein. Capitalized terms used but not defined herein shall have the meaning given
such terms in the Trust Indenture. See "APPENDIX B—Trust Indenture."
The Special Service Area consists of approximately 156 acres of land in the City and
originally consisted of 202 lots for single family homes ("Single Family Homes"), 38 single
family attached dwellings ("Duplexes") and 128 townhomes ("Townhomes"). 12 Single Family
Homes have prepaid the Special Tax, leaving the Special Taxes on 190 Single Family Homes to
secure the Bonds; 5 Duplexes have prepaid the Special Tax, leaving the Special Taxes on 33
*Preliminary,subject to change.
4855-1679-8113.6
Duplexes to secure the Bonds; and 1 Townhome has prepaid the Special Tax, leaving the Special
Taxes on 127 Townhomes to secure the Bonds. The development of the Single Family Homes,
Duplexes and Townhomes within the Area are hereinafter referred to as the "Project."A finished
lot for a Single Family Home, a Duplex and a Townhome shall be sometimes referred to herein
respectively as a "Single Family Home Parcel," a "Duplex Home Parcel" or a "Townhome
Parcel" (collectively referred to as "Parcels"and individually as a"Parcel"). See"THE AREA."
The City previously issued its $9,400,000 Special Service Area Number 2004-107
Special Tax Bonds, Series 2005 (Raintree Village II Project) (the "Prior Bonds") pursuant to a
Trust Indenture dated as of November 1, 2005 (the "Prior Indenture"), between the City and The
Bank of New York Mellon Trust Company, N.A. (the "Prior Bond Trustee"), as Trustee for the
Prior Bonds. The Prior Bonds were issued to pay the costs of public infrastructure improvements
for the Area.
The proceeds of the Bonds, together with amounts on hand under the Prior Indenture, will
be used to: (i) effect the defeasance of and currently refund all of the outstanding Prior Bonds;
(ii) fund a portion of the Reserve Fund; (iii) pay the premiums owed for the Bond Policy and the
Reserve Fund Surety Policy; and (iv)pay costs of issuance of the Bonds. See "THE BONDS."
IN THE OPINION OF BOND COUNSEL, THE BONDS WILL CONSTITUTE VALID
AND LEGALLY BINDING LIMITED OBLIGATIONS OF THE CITY, PAYABLE SOLELY
AND ONLY FROM THE SPECIAL TAXES (AS PROVIDED IN THE BOND ORDINANCE,
THE SPECIAL TAX REPORT AND THE TRUST INDENTURE) AND AMOUNTS ON
DEPOSIT IN CERTAIN OF THE FUNDS AND ACCOUNTS ESTABLISHED AND
MAINTAINED UNDER THE TRUST INDENTURE, AS SET FORTH HEREIN. THE BONDS
ARE NOT GENERAL OBLIGATIONS OF THE CITY AND NEITHER THE FULL FAITH
AND CREDIT NOR THE UNLIMITED TAXING POWER OF THE CITY, THE COUNTY OF
KENDALL, THE STATE OF ILLINOIS, OR ANY POLITICAL SUBDIVISION THEREOF IS
PLEDGED TO THE PAYMENT OF THE BONDS. NO HOLDER OF ANY BOND SHALL
HAVE THE RIGHT TO COMPEL THE EXERCISE OF ANY TAXING POWER OF THE
CITY (OTHER THAN THE LEVY OF THE SPECIAL TAX) FOR PAYMENT OF THE
PRINCIPAL AMOUNT OF, PREMIUM, IF ANY, OR INTEREST ON THE BONDS.
A copy of any document or agreement referred to herein may be obtained upon request
from D.A. Davidson & Co. (the "Underwriter").
THE BONDS
General Description of the Bonds
The Bonds will be issued in the aggregate principal amount of$ , will bear
interest at the rates, and will mature on the dates set forth on the inside cover of this Official
Statement. The Bonds are subject to optional, mandatory and special mandatory redemption as
described herein. The Bonds will be issued only as fully registered bonds without coupons,
initially in book entry form, in authorized denominations of$5,000 or any integral multiple of
$1,000 in excess thereof.
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The Depository Trust Company, New York, New York ("DTC"), will act as securities
depository for the Bonds. Principal of, premium, if any, and interest on the Bonds will be paid by
the Trustee directly to DTC, which will remit such principal, premium, if any, and interest to
DTC's Participants, who, in turn will be responsible for remitting such payments to the
Beneficial Owners of the Bonds. See "THE BONDS - Book Entry Only System."
Interest on the Bonds will be paid in lawful money of the United States of America
semiannually on March 1 and September 1 of each year (each, an "Interest Payment Date"),
commencing September 1, 2024. Interest on the Bonds shall be calculated on the basis of a 360-
day year composed of twelve 30-day months.
The sum of $ shall be borrowed by the City pursuant to the Special Service
Area Act and the Local Government Debt Reform Act for the purpose of paying a portion of the
costs of effecting the defeasance and current refunding of the Prior Bonds (which, together with
amounts on hand under the Prior Indenture shall be sufficient to refund the Prior Bonds),
including the costs of the City in connection with the issuance of the Bonds (including, without
limitation, the premiums for the Bond Policy and the Reserve Fund Surety Policy), and making a
deposit to the Reserve Fund all as provided in the Bond Ordinance and the Trust Indenture. The
Bonds shall be designated "Special Service Area Number 2004-107 Special Tax Refunding
Bonds, Series 2024 (Raintree Village II Project)" and shall be numbered consecutively from R-1
upward but need not be authenticated or delivered in consecutive order. The Bonds will be dated
as of the date of their delivery.
Redemption
Optional Redemption. The Bonds maturing on or after March 1, , are subject to
optional redemption prior to maturity at the option of the City, in whole or in part, on any date on
or after March 1, 20 , at a redemption price of par plus accrued and unpaid interest to the date
of redemption.
Any optional redemption of the Bonds in part will be applied, to the extent possible, to
reduce pro rata the amount of the Bonds maturing or required to be redeemed by mandatory
sinking fund redemption pursuant to the Indenture and so as to maintain the proportion of
principal maturing or subject to mandatory sinking fund redemption in each year to the total
original principal amount of Bonds.
Mandatory Redemption Upon Condemnation. The Bonds are also subject to mandatory
redemption on any Interest Payment Date, in part, at a redemption price equal to the principal
amount to be redeemed, together with accrued interest to the date fixed for redemption, without
premium, from amounts in the Bond and Interest Fund consisting of the proceeds received by the
City in connection with a condemnation of any of the Special Services or any other property
dedicated to, or owned by, the City within the Area and allocable to the Bonds as determined by
DTA, formerly known as David Taussig & Associates, Inc. (the "Consultant") and which
proceeds are not used by the City to rebuild the Special Services.
Any mandatory redemption of the Bonds pursuant to the paragraph above shall be
applied, to the extent possible, to reduce pro rata the amount of Bonds maturing or required to be
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4855-1679-8113.6
redeemed by mandatory sinking fund redemption pursuant to the Indenture and so as to maintain
the proportion of principal maturing or subject to mandatory sinking fund redemption in each
year to the total original principal amount of the Bonds.
Special Mandatory Redemption from Optional Prepayment of Special Tax. The Special
Tax with respect to a Parcel may be prepaid at any time as described in the Special Tax Report.
See "THE BONDS — Optional Prepayment of Special Tax." The Bonds are also subject to
mandatory redemption on any March 1, June 1, September 1 or December 1, in part, from any
such optional prepayments of the Special Tax from amounts available for disbursement from the
Special Redemption Account and from amounts transferred from the Reserve Fund and the
Special Reserve Fund to the Special Redemption Account pursuant to the Trust Indenture, at a
redemption price (expressed as a percentage of the principal amount of the Bonds to be
redeemed), as set forth in the following table, together with accrued interest on such Bonds to the
date fixed for redemption:
Redemption Dates Redemption Prices
Issue Date to and including , 20 102%
1, 20 to and including , 20 101
1, 20 to maturity 100
Any special mandatory redemption of the Bonds pursuant to the previous paragraph will
be applied, to the extent possible, to reduce pro rata the amount of the Bonds maturing or
required to be redeemed by mandatory sinking fund redemption pursuant to the Indenture and so
as to maintain the proportion of principal maturing or subject to mandatory sinking fund
redemption in each year to the total original principal amount of the Bonds.
Redemption Provisions; Notice of Redemption. If less than all the Bonds of any maturity
are to be redeemed on any redemption date, by mandatory or optional redemption, written notice
shall be given in writing to the Trustee at least 45 days prior to the redemption date from the City
or the Consultant. Notice shall include the pro-rata breakdown for any such redemption. The
Bond Registrar appointed in the Trust Indenture shall assign to each Bond of the maturity to be
redeemed a distinctive number for each $1,000 of principal amount of that Bond. The Bond
Registrar shall then select by lot from the numbers so assigned, using such method as it shall
deem proper in its discretion, as many numbers as, at $1,000 per number, shall equal the
principal amount of the Bonds of that maturity to be redeemed; provided that following any
redemption, no Bond shall be outstanding in an amount less than the minimum Authorized
Denomination except (a) as necessary to effect the mandatory sinking fund redemption of the
Bonds as provided in the Indenture or(b)to effect a special mandatory redemption from optional
prepayments when the total aggregate principal amount of Bonds outstanding is $5,000 or less.
Notice of the redemption of any Bonds, which by their terms shall have become subject
to redemption, shall be given to the registered owner of each Bond or portion of a Bond called
for redemption not less than 30 or more than 60 days before any date established for redemption
of the Bonds, by the Bond Registrar, on behalf of the City, by first class mail sent to the
registered owner's last address, if any, appearing on the registration books kept by the Bond
Registrar. All notices of redemption shall include at least the designation, date and maturities of
the Bonds called for redemption, CUSIP Numbers, if available, and the date of redemption. In
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4855-1679-8113.6
the case of a Bond to be redeemed in part only, the notice shall also specify the portion of the
principal amount of the Bond to be redeemed. The mailing of the notice specified above to the
registered owner of any Bond shall be a condition precedent to the redemption of that Bond,
provided that any notice which is mailed in accordance with the Trust Indenture shall be
conclusively presumed to have been duly given whether or not the owner received the notice.
The failure to mail notice to the owner of any Bond, or any defect in that notice, shall not affect
the validity of the redemption of any other Bond for which notice was properly given.
With respect to an optional redemption of any Bonds, unless moneys sufficient to pay the
principal of, redemption premium, if any, and interest on the Bonds to be redeemed shall have
been received by the Trustee prior to the giving of such notice of redemption, such notice may, at
the option of the City, state that said redemption shall be conditional upon the receipt of such
moneys by the Trustee on or prior to the date fixed for redemption. If such moneys are not
received, such notice shall be of no force and effect, the City shall not redeem such Bonds and
the Trustee shall give notice, in the same manner in which the notice of redemption was given,
that such moneys were not so received and that such Bonds will not be redeemed.
Purchase in Lieu of Redemption. In lieu of redemption as provided in the Trust Indenture,
moneys in the Bond and Interest Fund may be used and withdrawn by the City, subject to the
prior written consent of the Bond Insurer, for the purchase of outstanding Bonds, at public or
private sale as and when, and at such prices (including brokerage and other charges) as the City
may provide, but in no event may the Bonds be purchased at a price in excess of the principal
amount of such Bonds, plus interest accrued to the date of purchase and any premium which
would otherwise be due if such Bonds were to be redeemed in accordance with the Trust
Indenture.
Optional Prepayment of Special Tax
The manner in which the Special Tax may be optionally prepaid is described in the
Special Tax Report. Generally, so long as there are no delinquent Special Taxes with respect to a
Parcel (as defined in the Special Tax Report), the Special Tax may be prepaid with respect to any
Parcel at any time and the obligation to pay the Special Tax permanently satisfied by the
payment of an amount equal to the amount of prepayment determined in accordance with the
formula set forth in the Special Tax Report. See the information included in "APPENDIX A -
Special Tax Report" hereto for a more complete discussion of the calculation of the amount of
prepayment of Special Tax.
Book Entry Only System
THE INFORMATION PROVIDED IMMEDIATELY BELOW CONCERNING DTC
AND THE BOOK-ENTRY-ONLY SYSTEM, AS IT CURRENTLY EXISTS, IS BASED
SOLELY ON INFORMATION PROVIDED BY DTC AND IS NOT GUARANTEED AS TO
ACCURACY OR COMPLETENESS BY AND IS NOT TO BE CONSTRUED AS A
REPRESENTATION BY, THE UNDERWRITER OR THE CITY.
The Depository Trust Company ("DTC"), New York, NY, will act as securities
depository for the Bonds. The Bonds will be issued as fully-registered bonds registered in the
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4855-1679-8113.6
name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an
authorized representative of DTC. One fully-registered certificate will be issued for each
maturity of the Bonds, in the aggregate principal amount of such maturity, and will be deposited
with DTC.
DTC, the world's largest securities depository, is a limited-purpose trust company
organized under the New York Banking Law, a "banking organization" within the meaning of
the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934.
DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity
issues, corporate and municipal debt issues, and money market instruments (from over 100
countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates
the post-trade settlement among Direct Participants of sales and other securities transactions in
deposited securities, through electronic computerized book-entry transfers and pledges between
Direct Participants' accounts. This eliminates the need for physical movement of securities
certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers,
banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-
owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the
holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing
Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its
regulated subsidiaries. Access to the DTC system is also available to others such as both U.S.
and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations
that clear through or maintain a custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants"). DTC has a Standard& Poor's rating of AA+. The DTC Rules
applicable to its Participants are on file with the Securities and Exchange Commission. More
information about DTC can be found at www.dtcc.com.
Purchases of Bonds under the DTC system must be made by or through Direct
Participants, which will receive a credit for the Bonds on DTC's records. The ownership interest
of each actual purchaser of each Bond ("Beneficial Owner") is in turn to be recorded on the
Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation
from DTC of their purchase. Beneficial Owners are, however, expected to receive written
confirmations providing details of the transaction, as well as periodic statements of their
holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into
the transaction. Transfers of ownership interests in the Bonds are to be accomplished by entries
made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners.
Beneficial Owners will not receive certificates representing their ownership interests in Bonds,
except in the event that use of the book-entry system for the Bonds is discontinued.
To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC
are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as
may be requested by an authorized representative of DTC. The deposit of Bonds with DTC and
their registration in the name of Cede & Co. or such other DTC nominee do not effect any
change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the
Bonds; DTC's records reflect only the identity of the Direct Participants to whose accounts such
Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect
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Participants will remain responsible for keeping account of their holdings on behalf of their
customers.
Conveyance of notices and other communications by DTC to Direct Participants, by
Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to
Beneficial Owners will be governed by arrangements among them, subject to any statutory or
regulatory requirements as may be in effect from time to time. Beneficial Owners of Bonds may
wish to take certain steps to augment the transmission to them of notices of significant events
with respect to the Bonds, such as redemptions, tenders, defaults, and proposed amendments to
the Bond documents. For example, Beneficial Owners of Bonds may wish to ascertain that the
nominee holding the Bonds for their benefit has agreed to obtain and transmit notices to
Beneficial Owners.
Redemption notices shall be sent to DTC. If less than all of the Bonds within an issue are
being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct
Participant in such issue to be redeemed.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with
respect to Bonds unless authorized by a Direct Participant in accordance with DTC's MMI
Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the City as soon as
possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting
rights to those Direct Participants to whose accounts Bonds are credited on the record date
(identified in a listing attached to the Omnibus Proxy).
Payment of principal of, premium, if any and interest on the Bonds will be made to Cede
& Co., or such other nominee as may be requested by an authorized representative of DTC.
DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and
corresponding detail information from the City or Paying Agent, on payable date in accordance
with their respective holdings shown on DTC's records. Payments by Participants to Beneficial
Owners will be governed by standing instructions and customary practices, as is the case with
Bonds held for the accounts of customers in bearer form or registered in "street name," and will
be the responsibility of such Participant and not of DTC, the Paying Agent, or the City, subject to
any statutory or regulatory requirements as may be in effect from time to time. Payment of
redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other
nominee as may be requested by an authorized representative of DTC) is the responsibility of the
City or Paying Agent, disbursement of such payments to Direct Participants will be the
responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the
responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as depository with respect to the Bonds at
any time by giving reasonable notice to the City or the Trustee. Under such circumstances, in the
event that a successor depository is not obtained, Bonds are required to be printed and delivered.
The City may decide to discontinue use of the system of book-entry transfers through DTC (or a
successor securities depository). In that event, Bonds will be printed and delivered as described
in the Indenture.
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NEITHER THE CITY, THE UNDERWRITER, NOR THE TRUSTEE, WILL HAVE
ANY RESPONSIBILITY OR OBLIGATION TO ANY DIRECT PARTICIPANTS OR
INDIRECT PARTICIPANTS OR THE PERSONS FOR WHOM THEY ACT WITH RESPECT
TO (1) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC OR ANY SUCH
DIRECT PARTICIPANT OR INDIRECT PARTICIPANT; (2) THE PAYMENT BY ANY
PARTICIPANT OF ANY AMOUNT DUE TO ANY BENEFICIAL OWNER IN RESPECT OF
THE PRINCIPAL OF OR INTEREST OR PREMIUM ON THE BONDS; (3) THE DELIVERY
BY ANY SUCH DIRECT PARTICIPANT OR INDIRECT PARTICIPANT OF ANY NOTICE
TO ANY BENEFICIAL OWNER THAT IS REQUIRED OR PERMITTED UNDER THE
TERMS OF THE TRUST INDENTURE TO BE GIVEN TO BONDHOLDERS; (4) THE
SELECTION OF THE BENEFICIAL OWNERS TO RECEIVE PAYMENT IN THE EVENT
OF ANY PARTIAL REDEMPTION OF THE BONDS; OR (5) ANY CONSENT GIVEN OR
OTHER ACTION TAKEN BY DTC AS BONDHOLDER.
BOND INSURANCE
Bond Insurance Policy
Concurrently with the issuance of the Bonds, BAM will issue its Municipal Bond
Insurance Policy for the Bonds (the "Bond Policy"). The Bond Policy guarantees the scheduled
payment of principal of and interest on the Bonds when due as set forth in the form of the Bond
Policy included as an exhibit to this Official Statement.
The Bond Policy is not covered by any insurance security or guaranty fund established
under New York, California, Connecticut or Florida insurance law.
Build America Mutual Assurance Company
BAM is a New York domiciled mutual insurance corporation and is licensed to conduct
financial guaranty insurance business in all fifty states of the United States and the District of
Columbia. BAM provides credit enhancement products solely to issuers in the U.S. public
finance markets. BAM will only insure municipal bonds, as defined in Section 6901 of the New
York Insurance Law, which are most often issued by states, political subdivisions, integral parts
of states or political subdivisions or entities otherwise eligible for the exclusion of income under
section 115 of the U.S. Internal Revenue Code of 1986, as amended. No member of BAM is
liable for the obligations of BAM.
The address of the principal executive offices of BAM is: 200 Liberty Street, 27th Floor,
New York, New York 10281, its telephone number is: 212-235-2500, and its website is located
at: www.buildamerica.com.
BAM is licensed and subject to regulation as a financial guaranty insurance corporation
under the laws of the State of New York and in particular Articles 41 and 69 of the New York
Insurance Law.
BAM's financial strength is rated"AA/Stable" by S&P Global Ratings, a business unit of
Standard & Poor's Financial Services LLC ("S&P"). An explanation of the significance of the
rating and current reports may be obtained from S&P at www.standardandpoors.com. The
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rating of BAM should be evaluated independently. The rating reflects S&P's current assessment
of the creditworthiness of BAM and its ability to pay claims on its policies of insurance. The
above rating is not a recommendation to buy, sell or hold the Bonds, and such rating is subject to
revision or withdrawal at any time by S&P, including withdrawal initiated at the request of BAM
in its sole discretion. Any downward revision or withdrawal of the above rating may have an
adverse effect on the market price of the Bonds. BAM only guarantees scheduled principal and
scheduled interest payments payable by the issuer of the Bonds on the date(s) when such
amounts were initially scheduled to become due and payable (subject to and in accordance with
the terms of the Bond Policy), and BAM does not guarantee the market price or liquidity of the
Bonds, nor does it guarantee that the rating on the Bonds will not be revised or withdrawn.
Capitalization of BAM
BAM's total admitted assets, total liabilities, and total capital and surplus, as
of December 31, 2023 and as prepared in accordance with statutory accounting practices
prescribed or permitted by the New York State Department of Financial Services
were $500.0 million, $230.7 million and$269.3 million, respectively.
BAM is party to a first loss reinsurance treaty that provides first loss protection up to a
maximum of 15% of the par amount outstanding for each policy issued by BAM, subject to
certain limitations and restrictions.
BAM's most recent Statutory Annual Statement, which has been filed with the New York
State Insurance Department and posted on BAM's website at www.buildamerica.com, is
incorporated herein by reference and may be obtained, without charge, upon request to BAM at
its address provided above (Attention: Finance Department). Future financial statements will
similarly be made available when published.
BAM makes no representation regarding the Bonds or the advisability of investing in the
Bonds. In addition, BAM has not independently verified, makes no representation regarding,
and does not accept any responsibility for the accuracy or completeness of this Official
Statement or any information or disclosure contained herein, or omitted herefrom, other than
with respect to the accuracy of the information regarding BAM, supplied by BAM and presented
under the heading"BOND INSURANCE."
Additional Information Available from BAM
Credit Insights Videos. For certain BAM-insured issues, BAM produces and posts a
brief Credit Insights video that provides a discussion of the obligor and some of the key factors
BAM's analysts and credit committee considered when approving the credit for insurance. The
Credit Insights videos are easily accessible on BAM's website at www.buildamerica.com/videos.
(The preceding website address is provided for convenience of reference only. Information
available at such address is not incorporated herein by reference.)
Credit Profiles. Prior to the pricing of bonds that BAM has been selected to insure,
BAM may prepare a pre-sale Credit Profile for those bonds. These pre-sale Credit
Profiles provide information about the sector designation (e.g. general obligation, sales tax); a
preliminary summary of financial information and key ratios; and demographic and economic
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data relevant to the obligor, if available. Subsequent to closing, for any offering that includes
bonds insured by BAM, any pre-sale Credit Profile will be updated and superseded by a
final Credit Profile to include information about the gross par insured by CUSIP, maturity and
coupon. BAM pre-sale and final Credit Profiles are easily accessible on BAM's website at
www.buildamerica.com/credit-profiles. BAM will produce a Credit Profile for all bonds insured
by BAM, whether or not a pre-sale Credit Profile has been prepared for such bonds. (The
preceding website address is provided for convenience of reference only. Information available
at such address is not incorporated herein by reference.)
Disclaimers. The Credit Profiles and the Credit Insights videos and the information
contained therein are not recommendations to purchase, hold or sell securities or to make any
investment decisions. Credit-related and other analyses and statements in the Credit Profiles and
the Credit Insights videos are statements of opinion as of the date expressed, and BAM assumes
no responsibility to update the content of such material. The Credit Profiles and Credit Insight
videos are prepared by BAM; they have not been reviewed or approved by the issuer of or the
underwriter for the Bonds, and the issuer and underwriter assume no responsibility for their
content.
BAM receives compensation (an insurance premium) for the insurance that it is providing
with respect to the Bonds. Neither BAM nor any affiliate of BAM has purchased, or committed
to purchase, any of the Bonds, whether at the initial offering or otherwise.
RIGHTS OF BOND INSURER
The Indenture contains a number of provisions required by Bond Insurer, which
provisions shall govern so long as the Bond Policy is in effect and Bond Insurer is not in default
in its payment obligations under the Bond Policy. Such provisions, among other things, grant
Bond Insurer the right to receive notices of certain events and other information, the right to
consent to certain actions and recognition of the Bond Insurer as a third-party beneficiary under
the Security Documents. Upon the occurrence and continuance of an Event of Default, Bond
Insurer shall be deemed to be the sole holder of the Bonds for the purpose of the Security
Documents, including, without limitation, for purposes of exercising remedies under, and
approving amendments to, the Security Documents. Pursuant to the Indenture, the Trustee and
each Bondholder appoint Bond Insurer as their agent and attorney-in-fact and agree that Bond
Insurer may at any time during the continuation of any proceeding by or against the City under
the United States Bankruptcy Code or any other applicable bankruptcy, insolvency, receivership,
rehabilitation or similar law (an "Insolvency Proceeding"), including without limitation, (A) all
matters relating to any claim or enforcement proceeding in connection with an Insolvency
Proceeding (a "Claim"), (B) the direction of any appeal of any order relating to any Claim, (C)
the posting of any surety, supersedeas or performance bond pending any such appeal, and (D)the
right to vote to accept or reject any plan of adjustment. In addition, the Trustee and each owner
of the Bonds delegate and assign to the Bond Insurer, to the fullest extent permitted by law, the
rights of the Trustee and each owner of the Bonds with respect to the Bonds in the conduct of
any Insolvency Proceeding, including, without limitation, all rights of any party to an adversary
proceeding or action with respect to any court order issued in connection with any such
Insolvency Proceeding. See "APPENDIX B - Trust Indenture."
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PLAN OF FINANCE
General
The City will use the proceeds of the Bonds, together with amounts on hand under the
Prior Indenture, to: (i) effect the defeasance and currently refund all of the outstanding Prior
Bonds; (ii) make a deposit to the Reserve Fund for the Bonds in the amount of 50% of the
Reserve Requirement equal to $ (the remaining 50% of the Reserve Requirement will
be funded by the Reserve Fund Surety Policy as further described under the caption
"SECURITY AND SOURCE OF PAYMENT FOR THE BONDS — Pledged Funds — Reserve
Fund"); (iii) pay the premiums owed for the Bond Policy and the Reserve Fund Surety Policy;
and (iv) pay costs of issuance of the Bonds.
Refunding of Prior Bonds
The City has determined the refunding of the Prior Bonds to be in the public interest and
in furtherance of the public purposes of the City. The City expects to transfer to the Prior Bond
Trustee the amount of$ from the proceeds of the Bonds for deposit into the Bond and
Interest Fund created pursuant to the Prior Indenture and to be used, together with any other
funds on deposit therein, to pay the redemption price of the Prior Bonds on , 2024. The
table below sets forth the maturity date, interest rate, principal amount payable to refund the
Prior Bonds and the redemption date for the Prior Bonds.
Maturity Date Interest Rate Par Amount Redemption Date
March 1,2035 6.250% $4,817,000 , 2024*
* Preliminary and subject to change.
Amounts Held for Prior Bonds
The Indenture requires the City and the Trustee to cause the Prior Bond Trustee to (a)
transfer all amounts held by the Prior Bond Trustee in the Administrative Expense Fund
established for the Prior Bonds (the "Prior Bonds Administrative Expense Fund") as follows: (i)
the amount of$15,000 will be deposited into the Special Reserve Fund, and (ii) all remaining
amounts held by the Prior Bond Trustee in the Prior Bonds Administrative Expense Fund will be
deposited into the Administrative Expense Fund to be used to pay Administrative Expenses, and
(b) transfer and deposit all amounts held by the Prior Bond Trustee into the Bond and Interest
Fund for the Prior Bonds, to be applied to pay the redemption price of the Prior Bonds to be
redeemed on , 2024. Any additional Special Taxes collected from the levy for the Prior
Bonds will be deposited into the Bond and Interest Fund for the Bonds and applied in accordance
with the Indenture as further described under the caption "SECURITY AND SOURCE OF
PAYMENT FOR THE BONDS—Pledged Funds—Bond and Interest Fund."
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Estimated Sources and Uses of Funds
Sources of Funds:
Par Amount of the Bonds $
Net Premium/Discount
Prior Bond Trustee Held Funds
Total Sources $
Uses of Funds:
Refunding of Prior Bonds $
Deposit to Reserve Fund
Deposit to the Special Reserve Fund
Bond Insurance Premium and Reserve Fund Surety Bond Cost
Deposit to Administrative Expense Fund
Costs of IssuanceM
Total Uses $
(I) Includes Underwriter's discount.
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4855-1679-8113.6
DEBT SERVICE REQUIREMENTS*
The following table sets forth the debt service schedule for the Bonds based on the
maturity, and interest rate set forth on the cover of this Official Statement, assuming no
redemptions are made:
Bond Year
Ending
March 1 Principal Interest Annual Debt Service
2024 $83,790 $83,790
2025 $365,000 $101,907 $466,907
2026 $370,000 $189,762 $559,762
2027 $390,000 $175,517 $565,517
2028 $415,000 $160,580 $575,580
2029 $435,000 $144,810 $579,810
2030 $460,000 $128,280 $588,280
2031 $490,000 $110,570 $600,570
2032 $515,000 $91,215 $606,215
2033 $545,000 $70,615 $615,615
2034 $590,000 $48,815 $638,815
2035 $615,000 $25,215 $640,215
$5,190,000 $1,331,077 $6,521,077
Note:Totals may not sum due to rounding.
* Preliminary and subject to change.
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ESTIMATED SPECIAL TAX AND DEBT SERVICE COVERAGE*
The following table sets forth expected Special Tax and Debt Service Coverage:
Total
Bond Year Total Maximum
Ending Bonds Debt Administrative Adjusted Parcel Special Debt Service
March 1 Service Expenses(') Debt Service Tax(2) Coverage
2024 $83,790 $25,000 $108,790 $833,458 7.66
2025 $466,907 $25,375 $492,282 $835,920 1.70
2026 $559,762 $25,756 $585,518 $848,388 1.45
2027 $565,517 $26,142 $591,659 $861,173 1.46
2028 $575,580 $26,534 $602,114 $873,991 1.45
2029 $579,810 $26,932 $606,742 $887,126 1.46
2030 $588,280 $27,336 $615,616 $900,484 1.46
2031 $600,570 $27,746 $628,316 $913,969 1.45
2032 $606,215 $28,162 $634,377 $927,677 1.46
2033 $615,615 $28,585 $644,200 $941,702 1.46
2034 $638,815 $29,014 $667,829 $955,760 1.43
2035 $640,215 $29,449 $669,664 $970,168 1.45
Total $6,521,077
(I) Trustee Fees and Administrative Fees are estimated at$ per year increasing at 1.5%per year.
(2) Maximum parcel special taxes escalate annually at a rate of 1.5%.
Note: Totals may not sum due to rounding.
* Preliminary and subject to change.
SECURITY AND SOURCE OF PAYMENT FOR THE BONDS
General
The Bonds and the interest thereon are limited obligations of the City secured and
payable from (i) the Special Tax to be levied, extended and collected on all the taxable real
property within the Area subject to the Special Tax, (ii) amounts deposited in the Bond and
Interest Fund and the Reserve Fund, including a portion of the proceeds of the Bonds and the
interest, profits and other income derived from the investment thereof. When collected, the
Special Tax and Foreclosure Proceeds, including any interest and penalties collected in
connection with the Special Taxes or Foreclosure Proceeds, shall be placed in the Bond and
Interest Fund. In addition, proceeds received by the City in connection with a condemnation of
any of the Special Services or any other property owned by or dedicated to the City within the
Special Service Area and allocable to the Bonds as determined by the Consultant which is not
used to rebuild the Special Services shall be deposited in the Bond and Interest Fund. When the
amount of condemnation proceeds deposited to the Bond and Interest Fund equals $1,000 or
more, such amount shall be used to redeem Bonds on the next Interest Payment Date, as
described above under "THE BONDS - Mandatory Redemption Upon Condemnation." Any
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amounts representing condemnation proceeds which remain on deposit in the Bond and Interest
Fund for a continuous period of thirty (30) months and which will not be used to redeem the
Bonds on the next Interest Payment Date shall be used to pay debt service on the Bonds on the
next Interest Payment Date.
The amount of Special Tax that the City may levy in the Area in any year is strictly
limited by the maximum rates approved by the Corporate Authorities at the time of formation of
the Area. Under the Special Service Area Act, the City is legally authorized to, and will, extend
and collect the Special Tax in an amount determined according to the Special Tax Report.
Pursuant to the Bond Ordinance, the City has levied the Special Tax in the amounts set forth in
the Total Maximum Parcel Special Tax column in the Table hereinbelow under the caption
"THE SPECIAL SERVICE AREA AND SPECIAL TAX — Special Service Area Special Tax
Report," and will abate such tax each year for any special tax prepayments and to the extent it is
not required to pay principal or interest on the Bonds or replenish any reserve funds and
Administrative Expenses. The Special Tax Report apportions the total amount of Special Tax to
be collected among the Parcels in the Area as more particularly described herein.
The Special Tax
The levying of the Special Service Area's Special Tax was authorized by the Corporate
Authorities in Ordinance No. 2005-90, adopted at a meeting held on November 22, 2005 (the
"Establishing Ordinance"). Pursuant to the Establishing Ordinance, the City caused (i) the
Establishing Ordinance to be recorded with the Recorder of Deeds of Kendall County, Illinois,
and (ii) the Declaration of Consent of the original developer to be recorded with the Recorder of
Deeds of Kendall County, Illinois.
The Bonds are secured by, among other things, a pledge of the Special Tax, including all
scheduled payments of Special Tax received by the City, interest thereon, and proceeds of the
redemption or sale of property sold as a result of foreclosure of the lien of Special Tax and other
moneys deposited in the Funds and Accounts established under the Trust Indenture, other than
the Administrative Fund, the Special Reserve Fund, and the Rebate Fund. Pursuant to the Bond
Ordinance, the City has levied the Special Tax in the amounts set forth in the Total Maximum
Parcel Special Tax column in the Table set forth below under the caption "THE SPECIAL
SERVICE AREA AND SPECIAL TAX - Special Service Area Special Tax Report", and will
abate such tax each year and to the extent it exceeds the Special Tax Requirement as calculated
by the Consultant on its behalf. The City has covenanted in the Bond Ordinance and the Trust
Indenture annually on or before the last Tuesday of December for each of the years 2024 through
2033 to calculate or cause the Consultant to calculate the Special Tax Requirement; to amend the
Special Tax Roll and provide the County tax collector with the amended Special Tax Roll; and to
adopt an ordinance approving the amount of the current calendar year's Special Tax
Requirement and abating the Special Taxes levied pursuant to the Bond Ordinance to the extent
the taxes levied pursuant to the Bond Ordinance exceeds the Special Tax Requirement as
calculated by the City pursuant to the Establishing Ordinance and the Special Tax Report.
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On or before the last Tuesday of January for each of the years 2025 through 2034 the
City shall notify the Trustee of the amount of the Special Tax Requirement and the amount of the
Special Taxes to be abated. The City shall take all actions which shall be necessary to provide for
the levy, extension, collection and application of the taxes levied by the Bond Ordinance,
including enforcement of such taxes by providing Kendall County with such information as is
deemed necessary to enable the County to include any property subject to a delinquent Special
Tax in the County Collector's annual tax sale and, in the event the tax lien is forfeited at such tax
sale upon receipt of the written request of the Bond Insurer or a majority of the Bondholders by
instituting proceedings, including assigning to the Trustee its right to institute foreclosure
proceedings, and/or assigning to the Trustee its right to purchase as a taxing district the unpaid
taxes due upon the property all in the manner provided by law; provided, however, that the
obligation to purchase unpaid taxes, or institute any proceeding shall only arise in the event the
City or the Trustee, as applicable, makes the determination that sufficient funds are on deposit in
the Administrative Expense Fund to (i) pay all remaining Administrative Expenses expected for
such levy year, and (ii) apply to the purchase of the unpaid taxes and/or pay the costs of any
proceeding. See "THE SPECIAL SERVICE AREA AND SPECIAL TAX — Special Service
Area Special Tax Report."
The levy of the Special Tax is subject to certain limitations. The levy of the Special Tax
on property within the Area is constrained by the Maximum Parcel Special Tax amount
applicable to such Parcel. See "THE SPECIAL SERVICE AREA AND SPECIAL TAX —
Special Service Area Special Tax Report" and "RISK FACTORS — Maximum Parcel Special
Taxes" herein. The full amount of the Total Maximum Parcel Special Tax as set forth in the
subcaption "Special Service Area Special Tax Report" has been levied pursuant to the Bond
Ordinance, as adjusted for prepayments.
Although the Special Tax, when levied, will constitute a lien on Parcels within the Area,
it does not constitute a personal indebtedness of the owners of such property within the Area.
There is no assurance that the owners of property in the Area will be financially able to pay the
annual Special Tax or that they will pay such tax even if financially able to do so. See "RISK
FACTORS" herein.
No Additional Bonds
The Trust Indenture for the Bonds does not allow for the issuance of additional bonds or
other indebtedness other than for purposes of refunding the Bonds.
Pledged Funds
Bond and Interest Fund. The Trust Indenture creates and establishes with the Trustee a
separate and special fund of the City established exclusively for paying principal of, interest on
and redemption premium on the Bonds and which is designated as the "Special Service Area
Number 2004-107 Special Tax Refunding Bonds, Bond and Interest Fund" (the "Bond and
Interest Fund"). Upon receipt by the Trustee, the Special Taxes and the Foreclosure Proceeds,
including any interest and penalties, collected in connection with such Special Tax or
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Foreclosure Proceeds shall be placed in the Bond and Interest Fund. The City may provide for
Kendall County to transmit directly to the Trustee for deposit to the Bond and Interest Fund any
Special Tax collected by Kendall County. In addition, proceeds received by the City in
connection with a condemnation of any of the Special Services or any other property dedicated
to or owned by the City within the Special Service Area and allocable to the Bonds as
determined by the Consultant which are not used to rebuild the Special Services shall be
deposited in the Bond and Interest Fund. Moneys deposited in the Bond and Interest Fund and
investments of the Bond and Interest Fund shall never be commingled with or loaned to any
other funds of the City. All interest and other investment earnings on the Bond and Interest Fund
shall become, when received, a part of the Bond and Interest Fund. When the amount of
condemnation proceeds deposited to the Bond and Interest Fund equals $1,000 or more, such
amount shall be used to redeem Bonds on the next Interest Payment Date. Any amounts
representing condemnation proceeds which remain on deposit in the Bond and Interest Fund for
a continuous period of thirty (30) months and which will not be used to redeem the Bonds on the
next Interest Payment Date will be used to pay debt service on the Bonds on the next Interest
Payment Date.
Amounts deposited in the Bond and Interest Fund are appropriated for and irrevocably
pledged to, and shall be used solely for the purpose of, paying the principal of and interest and
redemption premium on the Bonds, or for transfers to the Reserve Fund, the Special Reserve
Fund or the Administrative Expense Fund as permitted in the Trust Indenture.
At any time after September 1 but in no event later than December 1 of each year, the
Trustee shall determine the amount needed to pay principal of and interest and redemption
premium on the Bonds on March 1 of the next succeeding year. After the Trustee has determined
that sufficient amounts are on deposit in the Bond and Interest Fund to pay principal of, interest
on and redemption premium due on the Bonds on the next March 1, the Trustee shall notify the
City and the Consultant of any excess amounts on deposit in the Bond and Interest Fund and, at
the written direction of the City, shall transfer an amount from the Bond and Interest Fund to the
Administrative Expense Fund which the City, after consultation with the Consultant, has
determined will be adequate, together with other amounts in the Administrative Expense Fund or
reasonably expected to be transferred to or deposited in such Fund, to pay all Administrative
Expenses during the succeeding calendar year. After making such transfer to the Administrative
Expense Fund any excess amounts on deposit in the Bond and Interest Fund will be transferred
to the Reserve Fund to the extent necessary to replenish the Reserve Fund to the Reserve
Requirement (or to restore the amount available under any Reserve Fund Surety Policy, together
with cash on deposit in the Reserve Fund, to the Reserve Requirement, as defined below under
the subcaption "Reserve Fund"). After (i) making such transfer to the Administrative Expense
Fund, and (ii) the Reserve Fund has amounts on deposit equal to the Reserve Requirement, any
excess amounts on deposit in the Bond and Interest Fund shall be transferred to the Special
Reserve Fund to the extent necessary to fund the Special Reserve Fund to the Special Reserve
Fund Requirement. The total amount transferred from time to time to the Special Reserve Fund
shall not exceed [$25,000] giving consideration to amounts that may have previously been
transferred from the Special Reserve Fund. Thereafter, any remaining excess shall be retained in
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the Bond and Interest Fund and applied to pay principal and interest coming due on the next
succeeding Interest Payment Date.
Special Redemption Account. A separate account designated the "Special Redemption
Account" exists within the Bond and Interest Fund established with the Trustee. All prepayments
of the Special Tax made in accordance with the Special Tax Report shall be deposited in the
Special Redemption Account. Amounts deposited in the Special Redemption Account
representing optional prepayments of Special Tax in accordance with the Special Tax Report
shall be applied to the redemption of the Bonds pursuant to the Trust Indenture and as described
under the caption "THE BONDS — Redemption—Special Mandatory Redemption from Optional
Prepayment of Special Tax."
Moneys in the Special Redemption Account shall be used exclusively to redeem Bonds
pursuant to the Trust Indenture or to pay debt service on the Bonds pursuant to the Trust
Indenture. In the event of any optional prepayment of Special Tax pursuant to Section 3.4 of the
Trust Indenture, prior to giving notice of the redemption of the Bonds in accordance with the
Trust Indenture, the Trustee will transfer from the Reserve Fund to the Special Redemption
Account an amount equal to the Reserve Fund Credit (as defined in the Special Tax Report) and
from the Special Reserve Fund (to the extent funds are available) to the Special Redemption
Account an amount equal to the Special Reserve Fund Credit, if any, upon the direction of the
Consultant in accordance with the Special Tax Roll and Report. When the amount on deposit in
the Special Redemption Account from amounts deposited pursuant to Section 3.3 of the Trust
Indenture equals or exceeds $1,000, such amount shall be used to redeem the Bonds on the next
Interest Payment Date in accordance with Section 3.3 of the Trust Indenture. On each such
Interest Payment Date, the Trustee shall withdraw from the Special Redemption Account and
pay to the owners of the Bonds the amounts to redeem such Bonds pursuant to Section 3.3 of the
Trust Indenture. When the amount on deposit in the Special Redemption Account from amounts
deposited pursuant to Section 3.4 of the Trust Indenture equals or exceeds $1,000, such amount
shall be used to redeem the Bonds on the next March 1, June 1, September 1, or December 1 in
accordance with Section 3.4 of the Trust Indenture. On each such redemption date, the Trustee
shall withdraw from the Special Redemption Account and pay to the owners of the Bonds the
amounts to redeem the Bonds pursuant to Section 3.4 of the Trust Indenture. Notwithstanding the
foregoing, any amounts contained in the Special Redemption Account for a continuous period of
thirty (30) months and which will not be used to redeem the Bonds in accordance with the two
immediately preceding sentences and the Trust Indenture shall be used to pay debt service on the
Bonds on the next Interest Payment Date. Any amounts contained in the Special Redemption
Account on the final maturity date of the Bonds shall be used to pay outstanding debt service on
the Bonds.
Reserve Fund. A separate and special fund of the City exists with the Trustee which is
designated as the "Special Service Area Number 2004-107 Special Tax Refunding Bonds,
Reserve Fund" (the "Reserve Fund"), and which is required to be maintained in an amount equal
to the Reserve Requirement. The Reserve Requirement shall be an amount equal to
$ , as reduced by the amount of any Reserve Fund Credits in connection with
prepayments pursuant to the Trust Indenture and as described in the preceding paragraph and
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4855-1679-8113.6
shall be funded by a cash deposit and a Reserve Fund Surety Policy. The Reserve Requirement
shall be satisfied by the deposit into the Reserve Fund of(i) cash in the amount of$
transferred by the Prior Bond Trustee from the Reserve Fund under the Prior Indenture, and (ii)
the Reserve Fund Surety Policy in the amount of$ . The City may at any time and
from time to time substitute cash, a Reserve Fund Surety Policy or any combination thereof for
either of the foregoing then on deposit in the Reserve Fund, and, thereupon, the Trustee shall
release all or a portion of such cash or Reserve Fund Surety Policy and shall cause such excess to
be deposited into the Bond and Interest Account and used for the payment of interest on the
Bonds on the next following Interest Payment Date, so long as the combination of the foregoing
remaining in the Reserve Fund following such release shall equal the Reserve Requirement.
At closing the cash portion of the Reserve Requirement will be equal to 50% of the total
Reserve Requirement or $ and the remaining 50% of the Reserve Requirement will be
funded by the Reserve Fund Surety Policy. Amounts deposited in the Reserve Fund (including
drawings under any Reserve Fund Surety Policy) shall be used solely for the purpose of (i)
making transfers to the Bond and Interest Fund to pay the principal of, including mandatory
sinking fund payments, and interest and any premium on, all Bonds when due, in the event that
moneys in the Bond and Interest Fund are insufficient therefor without further direction from the
City, (ii) making any transfers to the Bond and Interest Fund if the balance in the Reserve Fund
and the Special Reserve Fund exceeds the amount required to redeem all Bonds then
outstanding, (iii) making transfers to the Special Redemption Account in an amount equal to any
Reserve Fund Credit in the event of an optional prepayment of the Special Tax as provided in the
Indenture, or (iv) if the amount then on deposit in the Reserve Fund is at least equal to the
Reserve Requirement, for transfer in accordance with the next paragraph.
On the Business Day prior to each September 1 Interest Payment Date, (a) moneys in the
Reserve Fund in excess of the Reserve Requirement shall be transferred by the Trustee from the
Reserve Fund to the Bond and Interest Fund to be used for the payment of interest on the Bonds
on such September 1 Interest Payment Date, and (b) moneys in the Reserve Fund in excess of
(i)the Reserve Requirement and (ii) the interest due on the Bonds on such September 1 Interest
Payment Date, shall be used for the payment of principal on the Bonds on the next following
March 1 Interest Payment Date.
On the Business Day prior to each March 1 Interest Payment Date, (a) moneys in the
Reserve Fund in excess of the Reserve Requirement shall be transferred by the Trustee from the
Reserve Fund to the Bond and Interest Fund to be used for the payment of principal of and
interest and redemption premium (if any) on the Bonds on such March 1 Interest Payment Date,
and (b) moneys in the Reserve Fund in excess of (i) the Reserve Requirement and (ii) the
principal of and interest and redemption premium (if any) due on the Bonds on such March 1
Interest Payment Date, shall be used for the payment of interest on the Bonds on the next
following September 1 Interest Payment Date. Any amounts contained in the Reserve Fund on
the final maturity date of the Bonds shall be transferred to the Bond and Interest Fund, and used
to pay outstanding debt service on the Bonds.
4855-1679-8113.6
19
Withdrawals from the Reserve Fund shall be made from the following sources in the
following order of priority: (I) cash, and (2) from drawings under a Reserve Fund Surety Policy
in the order of priority provided for in such instruments. Any replenishment of the Reserve Fund
shall be applied first to the reimbursement of drawings under a Reserve Fund Surety Policy and
then to the restoration of cash. In the event that the City chooses to deposit a Reserve Fund
Surety Policy into the Reserve Fund, it may make reasonable covenants and agreements with the
issuer of the policy, surety or other facility including, but not limited to, covenants and
agreements related to the following:
(a) The application and priority of amounts deposited to the credit of the Reserve
Fund after a draw under the Reserve Fund Surety Policy to reimburse the issuer of the Reserve
Fund Surety Policy or to reimburse or replenish cash in the Reserve Fund;
(b) Not less than fifteen (15) days advance notice of the need for a draw by the
Trustee under the Reserve Fund Surety Policy and to maintain records; and
(c) The status of the issuer of the Reserve Fund Surety Policy as a third party
beneficiary under the Trust Indenture and its ability to enforce the provisions of the Trust
Indenture to the extent such rights may in fact benefit such issuer of the policy or facility.
The Reserve Fund Surety Policy
Bond Insurer has made a commitment to issue a financial guaranty insurance policy for
fifty percent (50%) of the Reserve Requirement with respect to the Bonds, effective as of the
date of issuance of the Bonds and held by the Trustee in the Reserve Fund. See "APPENDIX F
for a Specimen Municipal Bond Debt Service Reserve Insurance Policy." The Reserve Fund
Surety Policy, together with a portion of the proceeds of the Bonds to be deposited in the
Reserve Fund, will equal the Reserve Requirement. All amounts on deposit under the Indenture
available to pay debt service on the Bonds (exclusive of the Reserve Fund Surety Policy) shall be
used to pay such debt service before any drawing may be made on the Reserve Fund Surety
Policy. Draws on the Reserve Fund Surety Policy may be used only to pay principal of and/or
interest on the Bonds. The Bonds will be delivered only upon the issuance of the Reserve Fund
Surety Policy. Under the terms of the Reserve Fund Surety Policy, Bond Insurer will
unconditionally and irrevocably guarantee to pay that portion of the scheduled principal and
interest on the Bonds that becomes due for payment but shall be unpaid by reason of nonpayment
by the City (the"Insured Payment(s)").
Bond Insurer will pay each portion of an Insured Payment that is due for payment and
unpaid by reason of nonpayment by the City to the Trustee, as beneficiary of the Reserve Fund
Surety Policy on behalf of the holders of the Bonds on the later to occur of (i) the date such
scheduled principal or interest becomes due for payment or (ii) the business day next following
the day on which Bond Insurer receives a demand for payment therefor in accordance with the
terms of the Reserve Fund Surety Policy.
No payment shall be made under the Reserve Fund Surety Policy in excess of fifty
percent (50%) of the Reserve Requirement established for the Bonds (the "Reserve Fund Surety
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4855-1679-8113.6
Policy Limit"). Pursuant to the terms of the Reserve Fund Surety Policy, the amount available at
any particular time to be paid to the Trustee shall automatically be reduced to the extent of any
payment made by Bond Insurer under the Reserve Fund Surety Policy, provided, that, to the
extent of the reimbursement of such payment by the City to Bond Insurer, the amount available
under the Reserve Fund Surety Policy shall be reinstated in full or in part, in an amount not to
exceed the Reserve Fund Surety Policy Limit. The premium on the Reserve Fund Surety Policy
is included in the Costs of Issuance for the Bonds. See "PLAN OF FINANCE — Estimated
Sources and Uses of Funds"herein.
The Reserve Fund Surety Policy does not insure against nonpayment caused by the
insolvency or negligence of the Trustee or Paying Agent.
Costs of Issuance Account. The Indenture creates and establishes with the Trustee a
Costs of Issuance Account created within the Administrative Expense Fund, as a separate and
special fund of the City which is designated as "The Special Service Area Number 2004-107
Special Tax Refunding Bonds, Costs of Issuance Account, Series 2024" (the "Costs of Issuance
Account") . Amounts deposited in the Costs of Issuance Account shall be used solely for the
purpose of paying costs incurred in connection with the issuance of the Bonds and the refunding
of the Prior Bonds. On the date which is six (6) months after the date of issuance of the Bonds,
the Trustee shall transfer all amounts remaining in the Costs of Issuance Account to the
Administrative Expense Fund.
Non-Pledged Funds
Special Reserve Fund. A separate and special fund of the City which shall be designated
as the "Special Service Area Number 2004-107 Special Tax Refunding Bonds, Special Reserve
Fund" (the "Special Reserve Fund"). Special Taxes shall be deposited in the Special Reserve
Fund in accordance with Section 6.1 of the Indenture until the amounts on deposit in the Special
Reserve Fund equal the Special Reserve Fund Requirement. The total amount transferred from
time to time to the Special Reserve Fund shall not exceed [$25,000] giving consideration to
amounts that may have previously been transferred from the Special Reserve Fund.
Amounts deposited in the Special Reserve Fund shall be used solely for the purpose of(i)
making any transfers to the Bond and Interest Fund if the aggregate balance in the Special
Reserve Fund and the Reserve Fund exceeds the amount required to redeem all Bonds then
outstanding, (ii) for transfer to the Special Redemption Account in an amount equal to the
Special Reserve Fund Credit in accordance with Section 6.1(d) of the Indenture, (iii) on [March
1, ] for transfer to the Bond and Interest Fund as described below, (iv) at the direction of an
Authorized Officer for transfer to the Bond and Interest Fund or any other fund established under
the Trust Indenture, or (v) at the direction of an Authorized Officer for any use permitted by the
Special Service Area Act, provided an opinion of bond counsel is delivered to the Trustee to the
effect that such use will not violate the Special Service Area Act or adversely affect the tax-
exempt status of interest on the Bonds.
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On [March 1, ] (on which date the Special Reserve Fund Credit shall be zero), the
Trustee shall without further direction, transfer any remaining amounts on deposit in the Special
Reserve Fund to the Bond and Interest Fund to pay principal of and interest and redemption
premium on the Bonds on the next succeeding Interest Payment Date.
Any amounts in the Special Reserve Fund that are used to pay principal of, or interest or
premium on, the Bonds shall be treated as Special Taxes paid by the owners of the affected
Parcels for purposes of the Special Tax Roll and Report.
Amounts on deposit in the Special Reserve Fund are not pledged to the payment of
principal of or interest on the Bonds.
Administrative Expense Fund. A separate and special fund of the City which is
designated as the "Special Service Area Number 2004-107 Special Tax Refunding Bonds,
Administrative Expense Fund" (the "Administrative Expense Fund") exists with the Trustee.
Amounts in the Administrative Expense Fund shall be withdrawn by the Trustee and paid to the
City or its order upon receipt by the Trustee of a written request of an Authorized Officer stating
the amount to be withdrawn, that such amount is to be used to pay an Administrative Expense,
and the nature of such Administrative Expense.
Costs of Issuance Account. A separate account designated the "Costs of Issuance
Account" exists within the Administrative Expense Fund established with the Trustee. Amounts
deposited in the Costs of Issuance Account shall be used solely for the purpose of paying costs
incurred in connection with the issuance of the Bonds (including, without limitation, the
premiums for any Bond Policy and any Reserve Fund Surety Policy). Disbursements from the
Costs of Issuance Account shall be made by the Trustee upon receipt of a Written Request from
the City in the form of Exhibit D to the Trust Indenture which shall (i) set forth the amount
required to be disbursed, the purpose for which the disbursement is to be made, that the
disbursement is a proper expenditure from the Costs of Issuance Account, and payment
instructions to the Trustee for the amount to be disbursed and (ii) certify that no portion of the
amount then being requested to be disbursed was set forth in any previous request for
disbursement. On the date which is six months after the date of issuance of the Bonds, the
Trustee will transfer all amounts remaining in the Costs of Issuance Account to the
Administrative Expense Fund.
Rebate Fund. A separate and special fund of the City exists with the Trustee which is
designated as the "Special Service Area Number 2004-107 Special Tax Refunding Bonds,
Rebate Fund" (the "Rebate Fund"), into which there shall be deposited as necessary investment
earnings in the Bond and Interest Fund, the Reserve Fund and the Special Reserve Fund to the
extent required so as to maintain the tax exempt status of interest on the Bonds all at the direction
of the City. All rebates, special impositions or taxes for such purpose payable to the United
States of America (Internal Revenue Service) shall be payable from the Rebate Fund at the
direction of the City.
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Amounts in the Administrative Expense Fund, Special Reserve Fund and the Rebate
Fund are not pledged to the repayment of the Bonds.
Security for the Bonds
The Bonds and the interest thereon are secured and payable primarily from (i)the Special
Tax levied, and to be extended and collected on all taxable property within the Area subject to
the Special Tax, including interest on such Special Tax and the proceeds of the redemption or
sale of property sold as a result of any actions to foreclose the lien of Special Tax and any
interest accrued thereon, brought following a delinquency in the payment of the Special Tax, (ii)
any amounts transferred by the City to the Bond and Interest Fund, including the allocable
portion of condemnation proceeds received by the City not used to rebuild the Special Services,
and (iii) amounts deposited in the Bond and Interest Fund and the Reserve Fund.
Covenants of the City
Pursuant to the Trust Indenture, the City has covenanted for the benefit of the owners of
the Bonds (the "Bondowners")that the City will:
(a) take all actions, if any, which shall be necessary, in order further to provide for
the levy, extension, collection and application of the Special Tax levied pursuant to the Bond
Ordinance and Trust Indenture, including enforcement of the Special Tax by institution of
foreclosure proceedings as provided by law;
(b) not take any action which would adversely affect the levy, extension, collection
and application of the Special Tax levied pursuant to the Bond Ordinance and the Trust
Indenture, except to abate the Special Tax to the extent permitted by the Trust Indenture and the
Special Tax Report;
(c) comply with all requirements of the Special Service Area Act, the Bond
Ordinance and other applicable present and future laws concerning the levy, extension and
collection of the Special Tax levied pursuant to the Bond Ordinance and the Trust Indenture, in
each case so that the City shall be able to pay the principal of and interest on the Bonds as they
come due and replenish the Special Reserve Fund to the Special Reserve Requirements and the
Reserve Fund to the Reserve Requirement (or to restore the amount available under any Reserve
Fund Surety Policy, together with cash on deposit in the Reserve Fund, to the Reserve
Requirement), and take all actions necessary to assure the timely collection of the Special Taxes,
including, without limitation, the enforcement of any delinquent Special Tax by providing
Kendall County with such information as is deemed necessary to enable Kendall County to
include any property subject to a delinquent Special Tax in the Kendall County Collector's
annual tax sale and, upon receipt of the written request of the Bond Insurer or a majority of the
Bondholders, in the event the tax lien is forfeited at such tax sale by assigning to the Trustee its
right to institute foreclosure proceedings, and/or assigning to the Trustee its right to purchase as a
taxing district the unpaid taxes due upon the property all in the manner provided by law;
provided, however, that the obligation to purchase unpaid taxes, or institute any proceeding shall
only arise in the event the City or the Trustee, as applicable, makes the determination that
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sufficient funds are on deposit in the Administrative Expense Fund (i) pay all remaining
Administrative Expenses expected for such levy year, and (ii)to apply to the purchase of the
unpaid taxes and/or pay the costs of any proceeding;
(d) not encumber, pledge or place any charge or lien upon any of the Special Tax or
other amounts pledged to the Bonds superior to, or on a parity with, or junior to, the pledge and
lien created in the Trust Indenture for the benefit of the Bonds, except as permitted by, or
specifically set forth in,the Trust Indenture;
(e) take all actions which are necessary to be taken (and avoid any actions which it is
necessary to avoid being taken), so that interest on the Bonds will not be or become included in
gross income for federal income tax purposes under existing law;
(f) keep, or cause the Trustee to keep, proper books of record and accounts, separate
from all other records and accounts of the City, in which complete and correct entries will be
made of all transactions relating to the deposits to and expenditure of amounts disbursed from
the Funds and Accounts created under the Trust Indenture and the Special Tax; and
(g) to the extent possible, direct Kendall County, Illinois to deposit all Special Taxes
when collected, including Foreclosure Proceeds, condemnation proceeds and prepayments,
directly with the Trustee to be applied as set forth under the Trust Indenture.
Investment of Funds
Moneys on deposit in Funds and Accounts established under the Trust Indenture may be
invested from time to time in Qualified Investments pursuant to and solely at the direction of the
City to the Trustee provided that moneys on deposit in the Special Redemption Account shall be
invested in Qualified Investments having a maturity of 180 days or less. Subject to the
requirements of the Trust Indenture, earnings or losses on such investments shall be attributed to
the Fund or Account for which the investment was made. In the event that the Trustee does not
receive directions from the City to invest funds held under the Trust Indenture, the Trustee shall
invest such funds in a money market fund which invests in short-term securities issued or
guaranteed by the United States Government, its agencies or instrumentalities. The Trustee is
authorized to execute purchases and sales of Qualified Investments through the facilities of its
own trading or capital markets operations or those of any affiliated entity. Notwithstanding
anything in the Trust Indenture to the contrary, at the written direction of the City, the Trustee
shall invest amounts on deposit in the (1) Special Redemption Account of the Bond and Interest
Fund and (2)the Special Reserve Fund such that the yield on the investment does not exceed the
yield on the Bonds. The Reserve Fund shall be invested only in Qualified Investments with
maturities not longer than ten (10) years, the average life of which is no longer than five (5)
years. Investments on deposit in all funds and accounts established under the Trust Indenture
shall be valued at market value at least quarterly.
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Enforcement of Payment of Special Tax
In Illinois, general ad valorem property taxes are levied in one year and become payable
during the following year. At the end of each collection year, the Kendall County Treasurer
applies to the Circuit Court of Kendall County, for a judgment for all unpaid general ad valorem
property taxes. The Circuit Court of Kendall County order resulting from that application for
judgment provides for a sale of all property with unpaid general ad valorem property taxes. A
public sale is held, at which time successful bidders pay the unpaid general ad valorem property
taxes plus penalties. The annual tax sale is usually held during November of any given year in
Kendall County. Unpaid general ad valorem property taxes accrue penalties at the rate of 1 1/2%
per month from their due date until the date of sale. Taxpayers can redeem their property by
paying the purchaser of the delinquent taxes on the property at the general tax sale the amount
paid at the sale, plus a penalty. If redemption does not occur within two and one-half years, and
certain procedural requirements are met, the purchaser of the property at the tax sale can receive
a deed to the property which has been sold for delinquent taxes. Any delinquent Special Taxes
for any given year would be included in this general tax sale. If there is no sale of the tax lien on
a parcel of property at the annual tax sale, and the taxes remain unpaid, the taxes are forfeited
and eligible to be purchased at any time thereafter at an amount equal to all delinquent taxes and
interest to the date of purchase. Redemption periods and procedures are the same as applicable to
the annual tax sale.
In addition to using the annual tax sale as an enforcement mechanism, a municipality
may seek enforcement of unpaid special taxes through commencement of foreclosure
proceedings pursuant to the Special Service Area Act. If a delinquency in the payment of the
Special Tax occurs, the City is authorized by the Special Service Area to assign to the Trustee its
right to institute an action pursuant to Article 9 of the Illinois Municipal Code (65 ILCS 5/9-1-1,
et seq.) to foreclose any lien therefor securing the Special Tax. In such an action, a court having
jurisdiction would enter a foreclosure decree authorizing the sale of the property subject to the
lien of the Special Tax, and the real property subject to the lien of the Special Tax would be sold
at a judicial foreclosure sale. The ability of the Trustee to foreclose the lien of delinquent unpaid
Special Tax may be limited in certain instances and may require prior consent of the property
owner in the event that the property is owned by any receivership of the Federal Deposit
Insurance Corporation (the "FDIC"). See "RISK FACTORS — Bankruptcy" and "RISK
FACTORS—Tax Delinquencies."
Such judicial foreclosure proceedings are not mandatory under the Special Service Area
Act. However, in the Trust Indenture, the City has covenanted with the holders of the Bonds to
take all actions, if any, which shall be necessary to provide for the levy and extension, collection
and application of the Special Tax, and to assure the timely collection of the Special Tax,
including without limitation, the enforcement of any delinquent Special Tax by assigning to the
Trustee its right to commence and maintain an action to foreclose the lien of any delinquent
Special Tax; provided, however, that the obligation to institute any foreclosure action shall only
arise if the City makes the determination that the proceeds from each foreclosure action have a
commercially reasonable expectation of exceeding the costs thereof.
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No assurances can be given that a judicial foreclosure action, once commenced, will be
completed or that it will be completed in a timely manner. See "RISK FACTORS - Potential
Delay and Limitations in Foreclosure Proceedings" below. Article 9 of the Illinois Municipal
Code provides that the municipality or its assignee may file a complaint to foreclose a special
service area tax lien in the same manner that foreclosures are permitted by law in case of
delinquent general taxes. The "law in case of delinquent general taxes" to which the Illinois
Municipal Code refers is the Illinois Revenue Code. Under such foreclosure proceedings, the
court adjudicates the existence of a default in the payment obligation and authorizes a
foreclosure sale; the sale is conducted and the proceeds distributed according to the respective
priorities; the successful bidder is given a certificate of sale; and, if the redemption period
expires without a redemption of the special service area taxes, the certificate of sale may be
converted to a deed. Although the municipality holds the lien for the local improvement and is
therefore the proper party to commence foreclosure procedures, bondholders with bonds secured
by special service area taxes may compel the municipality to perform its duty and use all lawful
means, including foreclosure, to collect the taxes out of which the bondholders are to be paid.
Special service area taxes create a lien that is superior to other liens and encumbrances, and
when general property taxes and Special Taxes are both delinquent, the proceeds of any
foreclosure action, if insufficient to pay each in full, are divided between them on a pro rata
basis. If special service area taxes are not paid in full at a foreclosure sale, and the lien amounts
are bid on at such foreclosure sale, then unless the special service area taxes are then redeemed
through payment of the amount of the special service area taxes plus interest, the certificate of
sale can be converted into a deed to the property only after expiration of the applicable
redemption period. The Illinois Constitution prescribes certain minimum redemption periods for
unpaid taxes on property, including special service area taxes, but the Illinois General Assembly
may create longer redemption periods. For residential property with less than seven dwelling
units, the Illinois Constitution provides for a minimum two year redemption period. The
corresponding statute, however, permits the delinquent owner of such property to redeem it for
two and a half years (35 ILCS 200/21-350). Additionally, in certain circumstances the
redemption period may be extended for a period which will expire no later than 3 years from the
date of sale (35 ILCS 200/21-385). If the property can also be considered "vacant non-farm real
estate," the Constitution authorizes a reduction of the redemption period to one year, but the
statute applicable to special service area taxes contains no such exception.
No assurances can be given that the real property subject to sale or foreclosure and sale
will be sold or, if sold, that the proceeds of sale will be sufficient to pay any delinquent
installment of special service area taxes. Neither the Special Service Area Act nor Article 9 of
the Illinois Municipal Code requires the Trustee, as assignee of the City's right to foreclose, to
purchase or otherwise acquire any lot or parcel of property offered for sale or subject to
foreclosure if there is no other purchaser at such sale. Article 9 of the Illinois Municipal Code
does specify that the special service area taxes will have the same lien priority in the case of
delinquency as the priority of the lien of ad valorem property taxes.
If the Reserve Fund is depleted and delinquencies in the payment of Special Tax
exist, there could be a default or delay in payments to the Bondowners pending the annual
tax sale and/or prosecution of foreclosure proceedings and receipt by the City of the sale
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and/or foreclosure sale proceeds, if any. However, within the limits of the Special Tax
Report and the Special Service Area Act, the City may adjust the Special Tax levied on all
property within the Area in future calendar years to provide an amount, taking into
account such delinquencies, required to pay debt service on the Bonds and to replenish the
Reserve Fund. The amounts of the Maximum Parcel Special Tax are sufficient to pay the
amounts required by the Trust Indenture to be paid on the Bonds; however, there are no
assurances that the taxes levied will always be collected in their entirety.
Value to Lien Ratio
The following table sets forth sample value-to-lien ratios with respect to the Project.
Product Types Market Value(1) Bond Assessment Lien Value to Lien
Duplex $278,830.00 $14,329.87 19.458
Townhomes $236,010.00 $10,592.28 22.281
Single Family Homes $298,610.00 $16,167.87 18.469
Source:Kendall County Tax Assessor.
(I) Market value based on three times of average EAV for tax year 2023 for developed lots in the Area
The value-to-lien ratio is based on the estimated market value of the Parcels. No
assurance can be given that the foregoing ratio can or will be maintained during the period of
time the Bonds are outstanding both because property values could drop and because other
public entities, over which the Area has no control, could issue additional indebtedness secured
by a lien on parity with the lien securing payment of the Special Tax or payable through the levy
or imposition of a tax on parity with the Special Tax.
Representative Property Taxes
The following tables set forth general ad valorem taxes, based on current rates, imposed
against Parcels improved with detached Single Family Homes, Duplexes or Townhomes in the
Area based on the assessed values for such property and the most recent tax bills received by the
owners of the property in the Area.
Single Family Duplex
United City of Yorkville Homes Homes Townhomes
Average Market Value $298,610 $278,830 $236,010
Average Assessed Value $99,537 $92,943 $78,670
Multiplier 1 1 1
Average Homeowners $6,000 $6,000 $6,000
Exemption
Average Taxable Valuation $93,537 $86,943 $72,622
Single Family Duplex
Taxing Agency Homes Homes Townhomes
Kendall County 0.590750% 0.590750% 0.590750%
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Bristol- Kendall Fire Protection District 0.698760% 0.698760% 0.698760%
Forest Preserve 0.147640% 0.147640% 0.147640%
Jr College#516 0.464150% 0.464150% 0.464150%
Yorkville Library 0.255320% 0.255320% 0.255320%
Yorkville/Bristol Sanitary District 0.000000% 0.000000% 0.000000%
Kendall Township 0.087810% 0.087810% 0.087810%
Kendall Road District 0.223390% 0.223390% 0.223390%
School Dist.CU 115 6.652400% 6.652400% 6.652400%
City of Yorkville 0.537710% 0.537710% 0.537710%
Total Tax Rate 9.657930% 9.657930% 9.657930%
Kendall Township Representative Ad Valorem Tax $9,033.74 $8,396.89 $7,013.78
Kendall Township Maximum Parcel Tax Levy Year $2,743.00 $2,245.00 $1,895.00
2023
Kendall Township Actual Parcel Tax Levy Year 2023 $2,743.00 $2,245.00 $1,895.00
Total Taxes $11,776.74 $10,641.89 $8,908.78
Source: Kendall County,for Tax Codes KE021
The City has no control over the amount of additional debt payable from taxes or
assessments on all or a portion of the property within the Area, that may be issued in the future
by other governmental entities or districts. Nothing prevents the owners of land within the Area
from consenting to the issuance of additional debt by other public agencies which would be
secured by taxes or assessments on the same property subject to the Special Tax. To the extent
such indebtedness is payable from assessments, and other special taxes levied pursuant to the
Special Service Area Act or other taxes, such assessments, special taxes and other taxes may
have a lien on the property within the Area in addition to and on parity with the lien of the
Special Tax. Accordingly, the liens on the property within the Area could increase without any
corresponding increase in the value of the property within the Area and thereby reduce the ratio
that exists at the time the Bonds are issued between the value of the property and the debt
secured by the taxes and assessments thereon. The imposition of such additional indebtedness
could also reduce the willingness and ability of the property owners within the Area to pay the
Special Tax when due. See "RISK FACTORS - Overlapping Indebtedness."
Historical EAV Single Family Duplex Townhomes
2023 $18,911,958 $3,253,021 $9,755,071
2022 $10,661,024 $2,220,240 $6,670,012
2021 $5,330,945 $25,227 $928,102
2020 $1,404,397 $50,454 $930,328
2019 $575,659 $0 $860,074
Historical Special Tax Collections and Delinquencies
The following table shows the historical Special Tax collections and delinquencies in
connection with the Area. In the event of a delinquency in the payment of a Special Tax, no
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assurance can be given that the proceeds of any foreclosure sale would be sufficient to pay the
delinquent Special Tax and any other delinquent special taxes, assessments or taxes.
Historical Special Tax Collections and Delinquencies -5 years..
Single Family Homes
Levy Year 2023 2022 2021 2020 2019
Total Billed $833,458 $845,270 $834,895 $823,066 $810,118
Total Collected (Before Tax Sale) $833,458 $845,270 $834,895 $812,050 $810,118
Percent Collected 100.00% 100.00% 100.00% 98.66% 99.89%
Sold at Tax Sale N/A N/A N/A $11,016 $880
Total Collected (After Tax Sale) N/A N/A N/A $11,016 $880
Percent Collected 100% 100% 100% 100% 100%
Source:Kendall County Treasurer and Special Service Area Administrator.
THE AREA
The information provided in this section "THE AREA" has been included because it may
be considered relevant to an informed evaluation and analysis of the Bonds. The Bonds and the
Special Tax are not personal obligations of any land owners. The Bonds are secured solely by the
Special Tax and certain other amounts on deposit with the Trustee. See "SECURITY AND
SOURCE OF PAYMENT FOR THE BONDS." The Prior Bonds were issued to finance a
portion of the construction and installation of the Special Services necessary to support the
development of the Project, and the Special Services have been constructed and installed. The
Bonds are being issued for the purpose of defeasing and currently refunding the Prior Bonds.
General
The Area is a subdivision of approximately 156 acres known as Raintree Village II. The
Area is generally located on the southeast side of Illinois Route 71, the southwest side of Illinois
Route 126 and east of State Route 47 in the United City of Yorkville, Illinois. The Area is
improved with 190 Single Family Homes, 33 Duplexes and 127 Townhomes. All parcels have
been developed within the Area.
Improvements
With proceeds from the Prior Bonds, the City completed the necessary public
infrastructure improvements for the Special Service Area. These improvements included
engineering, soil testing, mass grading and demolition, storm water management facilities, storm
drainage systems and sewers, site clearing, public water facilities, sewer lines, roads, streets,
curbs, gutters, street lighting, traffic controls, sidewalks, parks and landscaping, mitigations and
related fees for water or sanitary sewer services, and other eligible improvements to serve the
Area.
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Single Family Homes,Duplexes and Townhomes
The Single Family Homes, Duplexes and Townhomes range in approximate size from
1,500 square feet to over 3,500 square feet. Standard features of the Single Family Homes,
Duplexes and Townhomes include over 12 different plan designations having the following
features:
2 bedroom plus den to 4 bedroom plus loft and den homes
2-3 car attached garage
1.5 to 3.5 Bathrooms
Dishwasher
Disposal
Wall-to-wall carpeting
Basement(Single Family Homes Only)
Water Facilities
The City provides the Area with potable water for domestic water consumption and fire
flow protection and maintains the water distribution system to and within the Area. A permanent
water tower and booster for the Area was constructed by the City.
Sanitary Sewers
The Area was annexed to the Yorkville-Bristol Sanitary District ("YBSD") for the
purpose of extending and connecting to the Yorkville-Bristol sanitary sewer lines and treatment
facilities. YBSD constructed an expansion of its sewer treatment plant adding sufficient capacity
to serve the sanitary sewer needs of the entire Area.
Storm Water Facilities
The Area has underground sewers for its buildings, structures, streets, driveways, and
other locations which are conveyed and maintained by the City, and has graded, open swales or
ditches and storm water retention/detention areas.
Other Utilities
The cable television franchise in this region is SBC. NICOR, SBC, and Com Ed provide
gas, telephone, and electrical service, respectively,to the Area.
Flood Plain/Wetlands
The development is not in a flood plain and will not impact any jurisdictional wetlands.
All flood plain and wetlands permits, if required, have been received.
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Schools
Yorkville Community School District No. 115, with two grade schools serving grades K-
2, an intermediate school serving grades 3-5, a middle school serving grades 6-8, and a high
school serving grades 9-12, serves the homes within the Area. Each school offers a full academic
program coupled with a variety of extra-curricular activities for students.
THE CITY
The United City of Yorkville was established in 1834 and has been the county seat of
Kendall County since 1859. It is located in northeastern Illinois on the Fox River, approximately
45 miles southwest of Chicago. Nearby communities include Oswego, Bristol, Plano, Millbrook,
Helmar, Newark, Plattville, Montgomery, Sugar Grove and Plainfield. According to the 2010
Census, the City had a population of 21,683. Additional information about the City is set forth in
the following tables.
Equalized Assessed Valuation
Levy Year
2018 2019 2020 2021 2022
By Property Class
Residential $416,780,620 $450,745,939 $484,024,398 $524,668,429 $594,475,190
Farm 3,202,140 3,259,791 3,360,133 3,524,082 3,936,704
Commercial 83,874,064 83,974,878 79,649,698 79,815,145 80,620,321
Industrial. 15,386,433 15,509,884 15,586,411 15,512,284 15,925,318
Railroad 60,243 89,004 75,859 77,628 90,328
Total $519,303,500 $553,579,496 $582,696,499 $623,597,568 $695,047,861
Percent 6.14%(1) 6.60% 5.26% 7.02% 11.46%
Change
Source:Kendall County Clerk.
(1) Percentage change based on 2017 EAV of$489,281,362
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Representative Tax Rates
(Per$100 EAV)
Levy Year
The City 2018 2019 2020 2021 2022
Corporate $0.1931 $0.1811 $0.1694 $0.1579 $0.1417
Police Protection 0.1709 0.1562 0.1484 0.1596 0.1625
Police Pension 0.2140 0.2223 0.2291 0.2141 0.1984
Audit 0.0057 0.0054 0.0051 0.0048 0.0043
Liability Insurance 0.0077 0.0072 0.0069 0.0064 0.0058
Social Security/IMRF 0.0289 0.0271 0.0258 0.0241 0.0216
School Cross Guard 0.0039 0.0036 0.0034 0.0032 0.0029
Revenue Recapture 0.0000 0.0000 0.0000 0.0009 0.0006
Total City Rate') $0.6242 $0.6030 $0.5880 $0.5710 $0.5377
Kendall County 0.6728 0.6409 0.6232 0.6016 0.5908
Kendall County Forest Preserve 0.1503 0.1542 0.1582 0.1620 0.1476
Kendall Township 0.3540 0.3520 0.3429 0.3323 0.3112
Bristol - Kendall Fire District 0.7300 0.7202 0.7159 0.7050 0.6988
Unit School District Number 115 7.1852 7.0338 6.9567 6.7867 6.6524
Community College District Number 516 0.5413 0.5273 0.4378 0.4698 0.4642
Yorkville Library 0.2892 0.2829 0.2775 0.2678 0.2553
Total Tax Rate(2) $10.5471 $10.3141 $10.1002 $9.8963 $9.6579
Source: Kendall County Clerk.
(1) [Statutory tax rate limits for the City are as follows: Corporate ($0.4375); Police Protection($0.6000); Garbage
($0.2000);School Crossing Guard($0.0200).]
(2) Representative tax rates for other government units are from Kendall Township tax code 003.
Tax Extensions and Collections
(Excludes Road, Bridge and Library Levies)
Levy Year Collection Year Taxes Extended(') Taxes Collectee)
Amount Percentage
2017 2018 $3,165,651 $3,149,635 99.49%
2018 2019 3,241,457 3,231,926 99.71%
2019 2020 3,337,703 3,327,913 99.71%
2020 2021 3,426,430 3,415,461 99.68%
2021 2022 3,560,742 3,552,451 99.77%
2022 2023 3,555,130 In Collection
Source:Kendall County Treasurer and the City.
( 0 Tax extensions have been adjusted for abatements.
(2)Total collections include back taxes,taxpayer refunds,interest,etc.
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Principal Taxpayers(1)
Taxpayer Name Business/Service 2022 EAV
Wrigley Manufacturing Co LLC Gum $ 4,668,910
Yorkville Marketplace LLC Yorkville Shopping Center 3,851,349
Yorkville Apartments Holdings LLC Apartments 3,486,011
Menard Inc Retail 2,991,882
Fox River Harmony Housing LLC Affordable Housing Investments 2,779,144
Rainy Properties I LLC Real Property 2,555,759
Cedarhurst of Yorkville Real Estate LLC Senior Housing Options 2,098,088
Target Corporation Retail 1,900,000
Alliance Development Corp Real Property 1,866,429
Kendall Holdings I LLC Kendall Market Place 1,592,230
TOTAL $27,789,802
Ten Largest Taxpayers as a Percent of the City's 2022 EAV($695,047,861) 4.00%
Source: Kendall County Clerk
(1) Every effort has been made to seek out and report the largest taxpayers. However,many taxpayers listed contain
multiple parcels and it is possible that some parcels and their valuations have been overlooked. The 2022 EAV
by PIN is the most current available.
Annual Average Unemployment Rates
Calendar Year The City Kendall County State of Illinois
2014 6.6% 6.5% 7.2%
2015 4.9 5.3 6.0
2016 5.0 5.2 5.9
2017 4.4 4.4 4.9
2018 3.6 3.6 4.4
2019 3.4 3.4 4.0
2020 8.5 7.9 9.3
2021 5.3 4.7 6.1
2022 4.3 4.0 4.6
2023 NA 3.8 4.3
Source:Illinois Department of Employment Security
THE SPECIAL SERVICE AREA AND SPECIAL TAX
The Act
Section 7(6) of Article VII of the Illinois Constitution of 1970 permits a non-home rule
unit to levy or impose additional taxes upon areas within its boundaries to provide special
services to those areas and to pay debt incurred in order to provide those special services in the
manner provided by law. Such areas are established pursuant to the provisions of the Special
Service Area Act. Under the Special Service Area Act, the Corporate Authorities of the
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municipality within which the special service area lies constitute the governing body of such
special service area.
The Special Service Area Act provides that bonds may be issued to provide for the
special services. Such bonds do not constitute indebtedness of the municipality in which the
special service area is situated for the purpose of any limitation imposed by any law. Such bonds
shall be retired by a tax which may be either an ad valorem property tax, a special tax, or a
combination of an ad valorem property and a special tax. A special tax may be levied or imposed
on any basis that provides a rational relationship between the amount of special tax levied or
imposed against each lot or parcel within the special service area and the special service benefit
conferred. The Special Service Area Act further provides that the lien and foreclosure remedies
provided in Article 9 of the Illinois Municipal Code shall apply on nonpayment of any special
tax.
The Special Service Area Act contains a provision that allows residents of a special
service area to petition the circuit court having jurisdiction to disconnect territory from the
special service area if, among other things, such territory was not, is not, and is not intended by
the corporate authorities which created the special service area to be benefited or served by work
or services then existing or authorized, and that such territory constitutes less than 1 1/2%of the
special service area's total equalized assessed valuation. The City represents that no parcel
within the Area meets this test.
Establishment of the Area
The City established SSA Number 2004-107 pursuant to the Establishing Ordinance,
which established SSA Number 2004-107 to provide certain special services, and authorized the
City to levy and collect Special Taxes in the manner set forth in the Special Tax Report, to pay
principal of and interest on the bonds secured by the Special Taxes in an aggregate principal
amount not to exceed $10,000,000 to be retired over a period not to exceed 40 years.
Levy,Abatement and Collection of Special Tax
In Illinois, property taxes levied in one year become payable during the following year as
provided in said levy. Pursuant to the Bond Ordinance, the City has levied the Maximum Parcel
Special Tax for all parcels within the Area. Pursuant to the Trust Indenture and the Special Tax
Report, the City has covenanted that prior to the last Tuesday of December of each year to
calculate or cause the Consultant to calculate the Special Tax Requirement due as provided in the
Special Tax Report, taking into account other amounts that may be available to pay principal of
and interest on the Bonds and administrative expenses, to amend the Special Tax Roll pursuant
to the Special Tax Report and shall, by ordinance, approve the amount of the Special Tax
Requirement and direct the County Clerk of Kendall County to extend the Special Tax for
collection on the tax books in the amounts so determined pursuant to the Special Tax Report
against all parcels of taxable property in the Area. The Kendall County Clerk must receive the
Special Tax Roll by the last Tuesday in December. The Kendall County Clerk intends, to the
extent possible, to incorporate the Special Tax bill into the regular ad valorem property tax bill
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which will be payable in two equal installments. The first installment is payable in June and the
second installment is payable in September. The Special Tax levied by the Bond Ordinance shall
be abated each year to the extent the taxes levied pursuant to the Bond Ordinance exceed the
Special Tax Requirement as calculated by the City.
At the end of each collection year, the Kendall County Treasurer applies to the Circuit
Court of Kendall County, for a judgment for all unpaid taxes. The Circuit Court of Kendall
County order resulting from that application for judgment provides for a sale of all property with
unpaid taxes. A public sale is held, at which time successful bidders pay the unpaid taxes plus
penalties. The annual tax sale is usually held during November in Kendall County. Unpaid taxes
accrue penalties at the rate of 1 1/2% per month from their due date until the date of sale.
Taxpayers can redeem their property by paying the purchaser of the property at the tax sale the
amount paid at the sale, plus a penalty. If redemption does not occur within two and one-half
years and certain procedural requirements are met, the purchaser of the property at the tax sale
can receive a deed to the property which has been sold for delinquent taxes. In addition, a
municipality may seek enforcement of unpaid Special Tax through foreclosure proceedings by
seeking in court an adjudication of the existence of a lien and a finding of a failure to pay Special
Tax when due. Upon making such a finding, a court having jurisdiction would enter a
foreclosure decree authorizing the sale of the property subject to the lien of the Special Tax. See
"SECURITY AND SOURCE OF PAYMENT FOR THE BONDS - Enforcement of Payment of
Special Tax"herein.
Special Service Area Special Tax Report
The following description of the Special Service Area Special Tax Report prepared by
DTA, formerly known as David Taussig & Associates, Inc., Irvine, California, Special Tax
Consultant, is qualified in its entirety by reference to the complete form of the Special Tax
Report set forth in "APPENDIX A - Special Tax Report" hereto. Capitalized terms used in this
section, but not defined, shall have the meaning given to such terms in the Special Tax Report
The Special Tax Report set forth the provisions for apportioning and levying the Special
Tax in the Area. The Special Tax has been and will be levied in the Area each calendar Levy
Year from 2024 to 2034. The amount of the Special Tax levied pursuant to the Special Tax
Report has been calculated to pay the actual or reasonably estimated costs directly related to the
administration of the Area, debt service on the Bonds, reasonably anticipated delinquent Special
Taxes, any amount required to replenish the Reserve Fund to the Reserve Requirement (or to
restore the amount available under any Reserve Fund Surety Policy, together with cash on
deposit in the Reserve Fund, to the Reserve Requirement), less available funds as directed under
the Indenture.
The Maximum Parcel Special Tax to be levied by the City within the Area in 2024 will
be $848,388, and will increase each year thereafter by 1.50% per year. The actual percentage
annual change in the Special Tax may be greater depending upon actual Special Tax receipts,
investment earnings, and administrative expenses.
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The Maximum Parcel Special Tax for any Parcel may be prepaid and the obligation of
the Parcel to pay the Maximum Parcel Special Tax may be permanently satisfied if there are no
delinquent Special Taxes with respect to such Parcel at the time of prepayment. The Maximum
Parcel Special Tax may also be prepaid in part, provided that proceeds for any such prepayment
are sufficient to permit the redemption of Bonds in such amounts and maturities deemed
necessary by the Consultant and in accordance with the Indenture.
An owner of a Parcel intending to prepay the Maximum Parcel Special Tax, either
partially or in full, shall provide the City with written notice of intent to prepay. Within 30 days
of receipt of such written notice, the City or its designee shall notify such owner of the amount of
the Special Tax Bond Prepayment for such Parcel and the date through which the amount shall
be valid.
The Special Tax Bond Prepayment for a Parcel is the amount equal to (a) the sum of(1)
Principal, (2) Premium, (3) Defeasance, and (4) Fees and (b) minus the Reserve Fund Credit.
The terms "Principal," "Premium," "Defeasance," and "Fees," and "Reserve Fund Credit" have
the following meanings:
"Principal" means the principal amount of Bonds to be redeemed and equals the quotient
derived by dividing (a) the then current Maximum Parcel Special Tax for the Parcel
intending to prepay by (b)the corresponding Maximum Parcel Special Taxes for the Area
(and excluding that portion of the Maximum Parcel Special Tax for any Parcel(s)that has
been prepaid), and multiplying the quotient by the principal amount of outstanding
Bonds.
"Premium" means an amount equal to the Principal multiplied by the applicable
redemption premium, if any, for any Bonds so redeemed with the proceeds of any such
prepayment. Any applicable redemption premium shall be as set forth in the Indenture.
"Defeasance" means the amount needed to pay interest on the Principal to be redeemed
until the earliest redemption date for the outstanding Bonds less any Special Taxes
heretofore paid for such Parcel and available to pay interest on the redemption date for
the Bonds.
"Fees" equal the expenses of the Area associated with the Special Tax Bond Prepayment
as calculated by the City or its designee and include, but are not limited to, the costs of
computing the Special Tax Bond Prepayment, the costs of redeeming the Bonds, and the
costs of recording and publishing any notices to evidence the Special Tax Bond
Prepayment and the redemption of Bonds.
"Reserve Fund Credit" shall equal the lesser of the Reserve Fund Requirement and the
balance in the Reserve Fund (as such terms are defined in the Indenture) multiplied by
the quotient used to calculate Principal.
"Special Reserve Fund Credit" means, with respect to each Parcel,the difference between
(A) the amount of the prepayment of the principal allocable to such Parcel calculated in
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accordance with the Special Tax Roll and Report and (B) the principal allocable to such
Parcel calculated in accordance with the Special Tax Roll and Report if the Prior Bonds
remained outstanding and the Bonds were not issued, as determined by the Consultant.
The amount of any partial Special Tax Bond Prepayment will be computed pursuant to
the preceding prepayment formula substituting the portion of the Maximum Parcel Special Tax
to be prepaid for the Maximum Parcel Special Tax when computing Principal. The amount of
any Special Tax Bond Prepayment or partial Special Tax Bond Prepayment may not exceed the
Bonds plus any Premium, Defeasance, and Fees.
The sum of the amounts calculated above will be paid to the City, deposited with Trustee,
and used to pay and redeem Bonds in accordance with the Indenture and to pay the Fees
associated with the Special Tax Bond Prepayment. Upon the payment of the Special Tax Bond
Prepayment amount to the City, the obligation to pay the portion of the Maximum Parcel Special
Tax which is prepaid for such Parcel shall be deemed to be permanently satisfied.
The following table sets forth certain information concerning the Special Tax, including
the aggregate Maximum Parcel Special Tax to be levied in 2023 through 2033 on the total non-
prepaid single family, duplex and townhome dwelling units and the Total Maximum Parcel
Special Tax which will be levied pursuant to the Bond Ordinance:
Levy Collection Single Per Unit
Year(1) Year Aggregate(2) Family Duplex Townhome
2023 2024 $835,920 $2,702 $2,212 $1,867
2024 2025 $848,388 $2,743 $2,245 $1,895
2025 2026 $861,173 $2,784 $2,279 $1,923
2026 2027 $873,991 $2,826 $2,313 $1,952
2027 2028 $887,126 $2,868 $2,348 $1,981
2028 2029 $900,484 $2,911 $2,383 $2,011
2029 2030 $913,969 $2,955 $2,419 $2,041
2030 2031 $927,677 $2,999 $2,455 $2,072
2031 2032 $941,702 $3,044 $2,492 $2,103
2032 2033 $955,760 $3,090 $2,529 $2,135
2033 2034 $970,168 $3,136 $2,567 $2,167
(1) Taxes to be collected in year after levy year.
(2) Based on 190 Single Family Homes,33 Duplexes and 127 Townhomes
Administrative Services
DTA (the "Administrator") will provide administrative services for the Area for the City
pursuant to an Administrative Services Agreement. The Administrator prepared the Special Tax
Report. Under the Administrative Services Agreement, the Administrator will (i) maintain a
Parcel database necessary to extend, bill and collect the Special Taxes, (ii) calculate the amount
of Special Tax to be abated for the Area, (iii) prepare an annual report for the Area, (iv) facilitate
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billing of the Special Tax, (v) monitor tax receipts and collections, (vi) track Special Tax
prepayment amounts, (vii) field taxpayer inquiries, and (viii)calculate any rebate on the Bonds.
RISK FACTORS
Investment in the Bonds involves risks which may not be appropriate for certain
investors. The following is a discussion of certain risk factors which should be considered, in
addition to other matters set forth in this Official Statement, in evaluating the Bonds. This
discussion does not purport to be comprehensive or definitive. The occurrence of one or more of
the events discussed herein could adversely affect the ability or willingness of property owners in
the Area to pay their Special Tax when due. Such failures to pay Special Tax could result in the
inability of the Area to make full and punctual payments of debt service on the Bonds. In
addition, the occurrence of one or more of the events discussed herein could adversely affect the
value of the property in the Area.
Limited Source of Funds
The Bonds, together with the interest thereon, are limited obligations of the City, payable
solely from the Special Tax and the amounts on deposit in certain of the funds and accounts
established and maintained under the Trust Indenture, all as more fully set forth therein. The
Bonds are not general obligations of the City and do not constitute an indebtedness of the City
within the meaning of any constitutional or statutory limitation. No holder of the Bonds shall
have the right to compel the exercise of any taxing power of the City for payment of principal
thereof or interest or premium, if any, thereon (other than the levy of the Special Tax as provided
in the Bond Ordinance and the Trust Indenture). See "SECURITY AND SOURCE OF
PAYMENT FOR THE BONDS - General" herein.
Information Not Verified
Information concerning the Area and the development has been obtained from the City
and other sources believed by the Underwriter to be reliable, but much of that information
involves predictions of future events, such as sales and ability of homeowners and other property
owners to pay their share of the Special Tax. Such information is, by its nature, not subject to
verification.
Overlapping Indebtedness
The Special Tax and any penalties assessed for failure to pay such taxes will constitute a
lien against the parcels of land on which they will be levied until such taxes are paid. Such lien
will be on a parity with all special taxes and special assessments which may be levied by other
agencies and is co-equal to and independent of the lien for general ad valorem real property taxes
regardless of when they are imposed upon the same property. The City, however, has no control
over the ability of other entities and districts to issue indebtedness secured by special taxes or
assessments payable from all or a portion of the property within the Area.
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The ability of an owner of land within the Area to pay the Special Tax could be adversely
affected if additional debt is issued or additional taxes or assessments are levied, which are
payable by the owners of land within the Area. The imposition of additional liens, whether
public or private, may reduce the ability or willingness of the homeowners to pay the Special
Tax and increase the possibility that foreclosure proceeds will not be adequate to pay any
delinquent Special Tax. The Bonds are not in any way secured by the first mortgage lien. The
Bonds are secured by the Special Tax, which has priority over a first mortgage lien.
Tax Delinquencies
In order to pay debt service on the Bonds, it is necessary that the Special Tax within the
Area be paid in a timely manner. Under provisions of the Special Service Area Act, the Special
Tax, from which funds necessary for the payment of principal of, and interest on, the Bonds are
derived, are customarily billed to the property owners within the Area on the regular general ad
valorem property tax bills sent to owners of such properties or on a special tax bill delivered at
the same time as the regular ad valorem property tax bills. Such Special Tax installments are due
and payable, and bear the same penalties and interest for nonpayment, as do general ad valorem
property tax installments. The unwillingness or inability of a property owner to pay ad valorem
property tax bills as evidenced by general ad valorem tax delinquencies may also indicate an
unwillingness or inability to make general ad valorem tax payments and Special Tax installment
payments in the future. If property owners fail to pay the Special Tax when due, there could be
significant special tax delinquencies.
Also, the Kendall County Collector may not be willing to bill the property owners in the
Area the Special Tax on their regular ad valorem property tax bills or if the Kendall County
Collector is willing to bill the property owners in the Area the Special Tax on their regular ad
valorem property bills today, the Kendall County Collector may not be willing to do so in the
future. In that event, the responsibility to bill and collect Special Tax would become the City's
responsibility under the Special Tax Report. However, the City has limited its obligation to pay
for the costs of billing and collecting to amounts on deposit in the Administrative Expense Fund.
See "SECURITY AND SOURCE OF PAYMENT FOR THE BONDS — Enforcement of
Payment of Special Tax" for a discussion of the provisions which apply, and procedures which
the City is obligated to follow under the Trust Indenture, in the event of delinquencies in the
payment of Special Tax. See "RISK FACTORS - Potential Delay and Limitations in Foreclosure
Proceedings" and `Bankruptcy" below, for a discussion of limitations on the City's ability to
foreclose the lien of delinquent unpaid Special Tax in certain circumstances.
Potential Delay and Limitations in Foreclosure Proceedings
The payment of Special Tax and the ability of the City to foreclose the lien of a
delinquent unpaid Special Tax may be limited by bankruptcy, insolvency and other laws
generally affecting creditors' rights or by the laws of the State relating to judicial foreclosure.
See "RISK FACTORS - Bankruptcy." In addition, the prosecution of a foreclosure could be
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delayed due to many reasons, including crowded local court calendars or lengthy procedural
delays.
The ability of the City to foreclose the lien of a delinquent unpaid Special Tax payment
may be limited with regard to properties in which the FDIC or any successor to the FDIC may
acquire an interest. The FDIC currently does not have an interest in the land within the Area.
However, if a lender takes a security interest in property in the Area and becomes insolvent, such
a lender could fall under the jurisdiction of the FDIC. The FDIC could assert federal preemptive
power to challenge any prior taxes, special taxes and assessments where it is in its interest to do
so, including the requirement that local agencies obtain the consent of the FDIC in order to
foreclose the lien of delinquent unpaid special taxes.
If the City is required to obtain the consent of the FDIC to foreclose on property located
in the Area, such consent could be denied and the City might be unable to pursue foreclosure
proceedings. Additionally, obtaining such consent could delay the foreclosure proceedings. Any
delay in foreclosure proceedings or the inability of the City to foreclose on property in the Area
in which the FDIC has an interest could result in a delay or default in payment of the Bonds.
In addition, potential investors should be aware that judicial foreclosure proceedings are
not summary remedies and can be subject to significant procedural and other delays caused by
crowded court calendars and other factors beyond the control of the Area or the City. In addition,
the Illinois Constitution prescribes certain minimum redemption periods, which may be as long
as three years, in the event of foreclosure. See "SECURITY AND SOURCE OF PAYMENT
FOR THE BONDS — Enforcement of Payment of Special Tax." Under current conditions, it is
estimated that a judicial foreclosure of the lien of the Special Tax could take several years from
initiation of litigation to the lien foreclosure sale.
Delays and uncertainties in the Special Tax lien foreclosure process create significant
risks for Bondowners. High rates of Special Tax payment delinquencies, which continue during
the pendency of protracted Special Tax lien foreclosure proceedings, could result in the rapid,
total depletion of the Reserve Fund prior to replenishment from the resale of Parcels in the Area
upon foreclosure. In that event, there could be a default in payments of the principal of, and
interest on, the Bonds.
No Acceleration
The Bonds are not subject to acceleration in the event of the breach of any covenantor
duty under the Trust Indenture, including payment default.
Bankruptcy
The various legal opinions to be delivered concurrently with the delivery of the Bonds
(including Bond Counsel's approving legal opinion) will be qualified, as to the enforceability of
the various legal instruments, by moratorium, bankruptcy, reorganization, insolvency or other
similar laws affecting the rights of creditors generally.
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Although a bankruptcy proceeding would not cause the Special Tax to become
extinguished, the amount and priority of any Special Tax lien could be modified if the value of
the property falls below the value of the lien. If the value of the property is less than the lien,
such excess amount could be treated as an unsecured claim by a bankruptcy court having
jurisdiction. In addition, bankruptcy of a property owner could result in a delay in
commencement and completion of foreclosure proceedings. The filing of bankruptcy
proceedings stays all legal proceedings of a debtor including any tax sale during the pendency of
such proceedings. Such stay would increase the likelihood of a delay or default in payment of the
principal of, and interest on, the Bonds and the possibility of delinquent tax Special Tax
installments not being paid in full.
Maximum Parcel Special Taxes
Pursuant to the Bond Ordinance, the City has levied the Special Tax in the maximum
amounts permitted by the Special Tax Report. However, there is no assurance that the maximum
amounts will at all times be sufficient to pay the amounts required to be paid by the Trust
Indenture. See "SECURITY AND SOURCE OF PAYMENT FOR THE BONDS — The Special
Tax" and "THE SPECIAL SERVICE AREA AND SPECIAL TAX — Special Service Area
Special Tax Report."
The Illinois State Legislature passed SB 107, which provides for an annual exemption
amount from property taxes ranging from $2,500 to full exemption for veterans of the United
States Military with a service-connected disability. The City cannot predict how, if at all, SB 107
will affect the City's collection of the Special Taxes.
Disclosure to Future Purchasers
The City has recorded the Establishing Ordinance for the property included in the Area in
the Office of the Recorder of Deeds of Kendall County on or prior to the Date of Delivery and
has recorded the Declarations of Consent in the Office of the Recorder of Deeds of Kendall
County on or prior to the Date of Delivery. While title companies normally refer to such notices
in title reports, there can be no guarantee that such reference will be made or, if made, that a
prospective purchaser or lender will consider such Special Tax obligation in the purchase of
single family homes, duplexes or townhomes or the lending of money thereon. Failure to
disclose the existence of the Special Tax may affect the willingness and ability of future owners
of land within the Area to pay the Special Tax when due.
Limited Secondary Market
There can be no guarantee that there will be a secondary market for the Bonds or, if a
secondary market exists, that such Bonds can be sold for any particular price. Except as
described below under the caption "CONTINUING DISCLOSURE,"the City has not committed
to provide any financial or operating data or information on a going forward basis. See
"APPENDIX B - Trust Indenture." Occasionally because of general market conditions, lack of
current information, or because of adverse history or economic prospects connected with a
particular issue, secondary marketing practices in connection with a particular issue are
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suspended or terminated. In addition, prices of issues for which a market is being made will
depend on then prevailing circumstances. Such prices could be substantially different from the
original purchase price.
Secondary Market and Prices
The Underwriter presently does not intend to engage in secondary market trading of the
Bonds. The Underwriter is not obligated to engage in secondary trading or to repurchase any of
the Bonds at the request of the Owners thereof. No assurance can be given that a secondary
market for any of the Bonds will be available and no assurance can be given that the initial
offering prices for the Bonds will continue for any period of time.
Loss of Tax Exemption
Interest on the Bonds could become includible in gross income for federal income tax
purposes retroactive to the date of issuance of the Bonds as a result of a failure of the City to
comply with certain provisions of the Code. Should such an event of taxability occur, the Bonds
are not subject to early redemption and will remain outstanding to maturity or until redeemed
under the optional redemption or mandatory redemption provisions of the Trust Indenture.
Risk of Legislative and Judicial Changes
Future legislation, regulations, governmental or judicial interpretation of regulations or
legislation or practices and procedures related to property tax assessment, levy, collections or
distribution could have a material effect on the calculation or availability of the Special Tax.
There is no assurance that legislation will not be considered or enacted in the future, and unless
provision is made in such legislation for special service areas generally in Illinois, the generation
of the Special Tax could be materially adversely affected.
Force Majeure Events
Certain unanticipated events beyond the City's control could have a material adverse
effect on the Department's and the City's operations and financial conditions if they were to
occur. These events include fire, flood, earthquake, epidemic, adverse health conditions or other
unavoidable casualties or acts of God, freight embargo, labor strikes or work stoppages, civil
commotion, new acts of war or escalation of existing war conditions, sabotage, terrorism or
enemy action, pollution, unknown subsurface or concealed conditions affecting the environment,
and any similar causes. No assurance can be provided that such events will not occur, and, if any
such events were to occur, the effect of such event or events on the Department's and the City's
operations and financial condition on the Net Revenues Available for Bonds cannot be predicted.
UNDERWRITING
The Underwriter, D.A. Davidson & Co., has agreed to purchase the Bonds from the City
for reoffering, subject to certain conditions, at an aggregate purchase price of $
representing the principal amount of the Bonds of$ plus net original issue premium
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of $ less Underwriter's discount of $ . Under the bond purchase
agreement between the City and the Underwriter (the "Bond Purchase Agreement"), the
Underwriter is obligated to purchase all of the Bonds if any are purchased. The obligation of the
Underwriter to make such a purchase is subject to certain conditions set forth in the Bond
Purchase Agreement. The Underwriter may change the prices and other terms with respect to the
offer and sale of the Bonds from time to time after the Bonds are released for sale, and the Bonds
may be offered and sold at prices other than the initial offering price set forth on the cover page
of this Official Statement, including sales to dealers.
LEGAL OPINIONS
Legal matters incident to the authorization, issuance and sale of the Bonds are subject to
the approving legal opinion of Saul Ewing LLP, Chicago, Illinois, Bond Counsel. The proposed
form of the opinion of Bond Counsel is included herein as "APPENDIX C - Bond Opinion."
Certain legal matters will be passed upon for the Underwriter by its counsel, Foley & Lardner
LLP, Chicago, Illinois; and for the City, by its counsel, Ottosen DiNolfo Hasenbalg & Castaldo,
Ltd.,Naperville, Illinois.
TAX EXEMPTION
Tax Exemption -Opinion of Bond Counsel
The Internal Revenue Code of 1986, as amended (the "Code") contains provisions
relating to the tax-exempt status of interest on obligations issued by governmental entities which
apply to the Bonds. These provisions include, but are not limited to, requirements relating to the
use and investment of the proceeds of the Bonds and the rebate of certain investment earnings
derived from such proceeds to the United States Treasury Department on a periodic basis. These
and other requirements of the Code must be met by the Issuer subsequent to the issuance and
delivery of the Bonds in order for interest thereon to be and remain excludable from gross
income for purposes of federal income taxation. The Issuer has covenanted to comply with such
requirements.
In the opinion of Bond Counsel, interest on the Bonds is not includable in gross income
for purposes of federal income taxation under existing statutes, regulations, rulings and court
decisions. The opinion of Bond Counsel is subject to the condition that the Issuer complies with
all applicable federal income tax law requirements that must be satisfied subsequent to the
issuance of the Bonds in order that interest thereon continues to be excluded from gross income.
Failure to comply with certain of such requirements could cause the interest on the Bonds to be
so includable in gross income retroactive to the date of issuance of the Bonds. The Issuer has
covenanted to comply with all such requirements. Interest on the Bonds is not treated as an item
of tax preference for purposes of the federal alternative minimum tax; ; however, such interest is
taken into account in determining the annual adjusted financial statement income of applicable
corporations (as defined in Section 59(k) of the Code) for the purpose of computing the
alternative minimum tax imposed on corporations for tax years beginning after December 31,
2022.
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In addition to the matters addressed below, prospective purchasers of the Bonds should
be aware that ownership of the Bonds may result in collateral tax consequences to certain
taxpayers, including but not limited to, foreign corporations, certain S corporations, financial
institutions, recipients of social security and railroad retirement benefits and property or casualty
insurance companies. Bond counsel expresses no opinion regarding any other federal tax
consequences relating to the Bonds or the receipt of interest thereon. Prospective purchasers of
the Bonds should consult their own tax advisors as to the impact of these other tax
consequences.
In the opinion of Bond Counsel, under the laws of the State of Illinois as enacted and
construed on the date hereof, interest on the Bonds is not exempt from Illinois income taxes.
Bond Counsel's opinion will be based on existing law, which is subject to change. Such
opinion is further based on factual representations made to Bond Counsel as of the date of
delivery of the Bonds. Bond Counsel assumes no duty to update or supplement its opinion to
reflect any facts or circumstances that may thereafter come to Bond Counsel's attention, or to
reflect any changes in law that may thereafter occur or become effective.
Alternative Minimum Tax
Interest on the Bonds is not treated as an item of tax preference for purposes of the
federal alternative minimum tax. However, such interest is taken into account in determining the
annual adjusted financial statement income of applicable corporations (as defined in Section
59(k) of the Code) for the purpose of computing the alternative minimum tax imposed on
corporations for tax years beginning after December 31, 2022.
Deduction for Interest Paid by Financial Institutions to Purchase or Carry Tax-Exempt
Obligations
The Code, subject to limited exceptions not applicable to the Bonds, denies the interest
deduction for indebtedness incurred or continued to purchase or carry tax-exempt obligations,
such as the Bonds. With respect to banks, thrift institutions and other financial institutions, the
denial to such institutions is one hundred percent (100%) for interest paid on funds allocable to
the Bonds and any other tax-exempt obligations acquired after August 7, 1986.
Property or Casualty Insurance Company
The Code also provides that a property or casualty insurance company may also incur a
reduction, by a specified portion of its tax-exempt interest income, of its deduction for losses
incurred.
[Accounting Treatment of Original Issue Discount and Amortizable Bond Premium
[The Bonds maturing on are hereinafter referred to as the "Discount Bonds." In
the opinion of Bond Counsel, the difference between the initial public offering price of the
Discount Bonds set forth on the [inside] front cover page and the stated redemption price at
44
4855-1679-8113.6
maturity of each such Bond constitutes "original issue discount," all or a portion of which will,
on the disposition or payment of such Bonds, be treated as tax-exempt interest for federal income
tax purposes. Original issue discount will be apportioned to an owner of the Discount Bonds
under a "constant interest method," which utilizes a periodic compounding of accrued interest. If
an owner of a Discount Bond who purchases it in the original offering at the initial public
offering price owns that Discount Bond to maturity, that Bondholder will not realize taxable gain
for federal income tax purposes upon payment of the Discount Bond at maturity. An owner of a
Discount Bond who purchases it in the original offering at the initial public offering price and
who later disposes of the Discount Bond prior to maturity will be deemed to have accrued tax-
exempt income in a manner described above; amounts realized in excess of the sum of the
original offering price of such Discount Bond and the amount of accrued original issue discount
will be taxable gain.
Purchasers of Discount Bonds should consult their tax own advisors with respect to the
determination and treatment of original issue discount for federal income tax purposes and with
respect to the state and local tax consequences of owning Discount Bonds.]
[The Bonds maturing on are hereinafter referred to as the "Premium Bonds." An
amount equal to the excess of the initial public offering price of a Premium Bond set forth on the
inside cover page over its stated redemption price at maturity constitutes premium on such
Premium Bond. A purchaser of a Premium Bond must amortize any premium over such
Premium Bond's term using constant yield principles, based on the purchaser's yield to maturity.
As premium is amortized, the purchaser's basis in such Premium Bond is reduced by a
corresponding amount, resulting in an increase in the gain (or decrease in the loss) to be
recognized for federal income tax purposes upon a sale or disposition of such Premium Bond
prior to its maturity. Even though the purchaser's basis is reduced, no federal income tax
deduction is allowed.
Purchasers of any Premium Bonds, whether at the time of initial issuance or subsequent
thereto, should consult their own tax advisors with respect to the determination and treatment of
premium for federal income tax purposes and with respect to state and local tax consequences of
owning Premium Bonds.]
Reportable Payments and Backup Withholding
The payments of interest on the Bonds will be reported to the Internal Revenue Service
by the payor on Form 1099 unless the holder is an "exempt person" under Section 6049 of the
Code. A holder who is not an exempt person may be subject to "backup withholding" at a
specified rate prescribed in the Code if the holder does not file Form W-9 with the payor
advising the payor of the holder's taxpayer identification number. Holders should consult with
their brokers regarding this matter.
The payor will report to the holders and to the Internal Revenue Service for each calendar
year the amount of any "reportable payments" during such year and the amount of tax, if any,
with respect to payments made on the Bonds.
45
4855-1679-8113.6
CHANGES IN FEDERAL AND STATE TAX LAW
Legislative or administrative actions and court decisions, at either the federal or state
level, could have an impact on the treatment of interest on the Bonds for federal or state income
tax purposes, and thus on the value or marketability of the Bonds. This could result from changes
to federal or state income tax rates, changes in the structure of federal or state income taxes
(including replacement with another type of tax), or otherwise. It cannot be predicted whether or
in what form any such proposals may be enacted or whether if enacted such proposals would
apply to bonds issued prior to enactment. In addition, regulatory or other actions are from time to
time announced or proposed which, if implemented or concluded in a particular manner, could
adversely affect the market value, marketability or tax status of the Bonds. It cannot be predicted
whether any such regulatory or other actions will be implemented or whether the Bonds would
be impacted thereby.
Purchasers of the Bonds should consult their tax advisors regarding any pending or
proposed legislation, regulatory initiatives or litigation. The opinions expressed by Bond Counsel
are based upon existing legislation and regulations as interpreted by relevant judicial and
regulatory authorities as of the date of issuance and delivery of the Bonds, and Bond Counsel has
expressed no opinion as of any date subsequent thereto or with respect to any proposed or
pending legislation, regulatory initiatives or litigation.
The Inflation Reduction Act, H.R. 5376 (the "IRA"), was signed into law by President
Biden on August 16, 2022. The IRA includes a 15 percent alternative minimum tax to be
imposed on the "adjusted financial statement income", as defined in the IRA, of certain
corporations for tax years beginning after December 31, 2022. Under the IRA, interest on the
Bonds is included in the"adjusted financial statement income" of such corporations for purposes
of computing such alternative minimum tax.
Prospective purchasers of the Bonds should be aware that the ownership of tax-
exempt obligations, such as the Bonds, may result in collateral federal income tax
consequences. Such prospective purchasers should consult their own tax advisors as to the
consequences of investing in the Bonds.
CONTINUING DISCLOSURE
Continuing Disclosure Undertaking
The City will enter into a Continuing Disclosure Undertaking (the "Undertaking") with
Amalgamated Bank of Chicago, as dissemination agent (the "Dissemination Agent") for the
benefit of the beneficial owners of the Bonds to send certain information annually and to provide
notice of certain events to the MSRB pursuant to the requirements of Section (b)(5) of Rule
15c2-12 (the "Rule") adopted by the SEC under the 1934 Act. The information to be provided on
an annual basis, the events which will be noticed on an occurrence basis and a summary of
certain other terms of the Undertaking are set forth below under "THE UNDERTAKING." The
Undertaking is set forth on"APPENDIX D—Continuing Disclosure Undertaking."
46
4855-1679-8113.6
THE UNDERTAKING
City's Annual Report. Within 240 days after the end of each fiscal year of the City
(currently ending April 30) commencing with the fiscal year ending April 30, 2024, the City
agrees to provide an Annual Report that will contain or incorporate by reference a copy of the
annual report prepared by the Consultant showing the Special Taxes received, all disbursements
from all Funds and Accounts administered under the Trust Indenture, including the balances in
all Funds and Accounts relating to the Bonds and the Additional Special Services as of the end of
such fiscal year, the collection of taxes, delinquencies, tax sales and foreclosures.
Event Disclosure. The City is also required to provide notice of the occurrence of certain
events with respect to the Bonds in a timely manner, not in excess of ten (10) business days after
the occurrence of such event. Such events are as follows:
(1) Principal and interest payment delinquencies;
(2) Non-payment related defaults, if material;
(3) Unscheduled draws on the Reserve Fund and/or Reserve Fund Surety Policy
reflecting financial difficulties;
(4) Unscheduled draws on the Bond Policy reflecting financial difficulties;
(5) Substitution of credit or liquidity providers, or their failure to perform;
(6) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed
or final determination of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax status of the security or other materials
events affecting the tax status of the security;
(7) Modification to rights of security holders, if material;
(8) Bond 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 Obligated Person;
(13) The consummation of a merger, consolidation, or acquisition involving an
obligated person or the sale of all or substantially all of the assets of the obligated person, other
than in the ordinary course of business,the entry into a definitive agreement to undertake such an
47
4855-1679-8113.6
action or the termination of a definitive agreement relating to any such actions, other than
pursuant to its terms, if material; and
(14) Appointment of a successor or additional trustee or the change of name of a
trustee, if material.
(15) Incurrence of a financial obligation of the City, if material, or agreement to
covenants, events of default, remedies, priority rights, or other similar terms of a financial
obligation of the City, any of which affect security holders, if material.
(16) Default, event of acceleration, termination event, modification of terms, or other
similar events under the terms of a financial obligation of the City, any of which reflect financial
difficulties.
For purposes of the events set forth in (15) and (16), "financial obligation" means a (i)
debt obligation, (ii) derivate instrument entered into in connection with or pledged as a security
or a source of payment for, an existing or planned debt obligation, or (iii) a guarantee of any of
the foregoing. Financial obligation does not include municipal securities as to which a final
official statement has been provided to the MSRB.
An event of default under the CDA will not constitute an Event of Default under the
Trust Indenture and the only remedy under the CDA is for an action to compel performance.
Notwithstanding any other provision of the CDA, the City by ordinance or resolution
authorizing such amendment or waiver, may amend the CDA, and any provision of the CDA
may be waived, if:
(a) (i) The amendment or waiver is made in connection with a change in
circumstances that arises from a change in legal requirements, including without limitation,
pursuant to a "no-action" letter issued by the Securities and Exchange Commission, a change in
law, or a change in the identity, nature, or status of the City, or type of business conducted; or
(ii) The CDA, as amended, or the provision, as waived, would have complied
with the requirements of the Rule at the time of the primary offering, after taking into account
any amendments or interpretations of the Rule, as well as any change in circumstances; and
(b) The amendment or waiver does not materially impair the interests of the
beneficial owners of the Bonds, as determined by parties unaffiliated with the City (such as Bond
Counsel) at the time of the amendment.
Corrective Action Related to Certain Bond Disclosure Requirements
The City has engaged Amalgamated Bank of Chicago to act as Dissemination Agent
under the Continuing Disclosure Undertaking to assure that future required filings are done
correctly and on a timely basis with respect to the Bonds.
48
4855-1679-8113.6
NO LITIGATION
At the time of delivery of and payment for the Bonds, the City will certify that there is no
action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court,
regulatory agency, public board or body, pending with respect to which the City has been served
with process or is otherwise aware, or, to the knowledge of the officer of the City executing such
certificate, threatened against the City affecting the existence of the City, the Area or the titles of
its officers to their respective offices or seeking to restrain or to enjoin the sale or delivery of the
Bonds, the application of the proceeds thereof in accordance with the Bond Ordinance and/or the
Trust Indenture, or the collection or application of the Special Tax, or in any way contesting or
affecting the validity or enforceability of the Bonds, the Bond Ordinance, the Trust Indenture or
any action of the City contemplated by any of the said documents, or the collection or
application of the Special Tax, or in any way contesting the completeness or accuracy of the
Bond Ordinance, the Trust Indenture or any amendments or supplements hereto, or contesting
the powers of the City contemplated by any of said documents, nor, to the knowledge of the
officer of the City executing such certificate, is there any basis therefor.
BOND RATING
Standard & Poor's Credit Market Services assigned its municipal bond rating of" "
( outlook) to the Bonds based upon the issuance of the Municipal Bond Insurance Policy
by the Bond Insurer at the time of delivery of the Bonds. No application was made to any other
rating agency for the purpose of obtaining an additional rating on the Bonds. A rating reflects
only the views of such organization and any desired explanation of the significance of such
rating should be obtained from the rating agency furnishing the same. Generally, a rating agency
bases its rating on the information and material furnished to it and on investigations, studies and
assumptions of its own. There is no assurance such rating will not be revised downward or
withdrawn entirely by the rating agency, if in the judgment of such rating agency, circumstances
so warrant. Any such downward revision or withdrawal of such rating may have an adverse
effect on the market price of the Bonds.
Except as may be required of the City by the Undertaking described under the heading
"CONTINUING DISCLOSURE," neither the City nor the Underwriter undertake responsibility
to bring to the attention of the owners of the Bonds any proposed change in or withdrawal of the
rating or to oppose any such revision or withdrawal.
MISCELLANEOUS
The references, excerpts, and summaries of documents and statutes contained in this
Official Statement do not purport to be complete statements of the provisions of such documents
and statutes, and reference is made to all such documents and statutes for full and complete
statements of their terms and provisions.
The estimates, assumptions, statistical and financial information, and all other
information contained in this Official Statement have been compiled from official and other
49
4855-1679-8113.6
sources believed to be reliable; however, none of such estimates, assumptions, or information is
guaranteed by the City, the Consultant, or the Underwriter as to completeness or accuracy.
Any statement made in this Official Statement involving matters of opinion or of
estimates, whether or not so expressly stated, is set forth as such and not as a representation of
fact; no representation is made that any of the estimates contained herein will be realized. The
information and expressions of opinion contained herein are subject to change without notice,
and neither the delivery of this Official Statement nor any offer or sale made hereunder shall,
under any circumstances, create any implication that there has been no change in the affairs of
the City or the Area since the date hereof.
[Remainder of page intentionally left blank]
50
4855-1679-8113.6
AUTHORIZATION
The City has authorized the execution and distribution of this Official Statement.
UNITED CITY OF YORKVILLE,
KENDALL COUNTY, ILLINOIS
By:
Its: Mayor
[Signature Page to Official Statement]
4855-1679-8113.6
4855-1679-8113.E APPENDIX A
Special Tax Report
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4855-1679-8113.6
APPENDIX B
Trust Indenture
4855-1679-8113.6
[This Page Intentionally Left Blank]
4855-1679-8113.6
APPENDIX C
Bond Opinion
4855-1679-8113.6
[This Page Intentionally Left Blank]
4855-1679-8113.6
APPENDIX D
Continuing Disclosure Undertaking
4855-1679-8113.6
[This Page Intentionally Left Blank]
4855-1679-8113.6
APPENDIX E
Specimen Municipal Bond Insurance Policy
4855-1679-8113.6
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4855-1679-8113.6
APPENDIX F
Specimen Municipal Bond Debt Service Reserve Insurance Policy
4855-1679-8113.6
Exhibit E
Form of the Continuing Disclosure Agreement
(See attached)
51642736.6
CONTINUING DISCLOSURE UNDERTAKING
THIS CONTINUING DISCLOSURE UNDERTAKING (this "Agreement") is executed
and delivered this _st day of March 2024 by and between the UNITED CITY OF
YORKVILLE, KENDALL COUNTY, ILLINOIS (the "Issuer"), and AMALGAMATED
BANK OF CHICAGO, as dissemination agent(the"Dissemination Agent"), in connection with
the issuance by the Issuer of its $ Special Service Area Number 2004-107 Special
Tax Refunding Bonds, Series 2024 (Raintree Village II Project) (the "Bonds"). The Bonds are
being issued pursuant an Ordinance adopted on February_,2024 by the City Council of the Issuer
(the "Bond Ordinance") and a Trust Indenture dated as of March 1, 2024 (the "Indenture")
between the Issuer and Amalgamated Bank of Chicago,as trustee. The Bonds will be as described
in, and secured pursuant to, the Bond Ordinance and the Indenture.
In consideration of the issuance of the Bonds by the Issuer and the purchase of such Bonds
by the beneficial owners thereof, the Issuer and the Dissemination Agent covenant and agree as
follows:
1. PURPOSE OF THIS AGREEMENT. The Issuer is entering into this Agreement
as of the date set forth above, for the benefit of the beneficial owner or owners of the Bonds in
order to provide certain information and to provide notice of certain events to the MSRB (as
defined below)pursuant to the requirements of Section (b)(5) of the Rule (as defined below) and
in order to assist the Underwriter (as defined below) in complying with the requirements of the
Rule. Notwithstanding anything set forth in this Agreement to the contrary, however, neither the
Issuer nor the Dissemination Agent will be required to provide any information or take any other
actions set forth hereunder until the Closing Date (as defined below). From and after the Closing
Date, the Issuer shall furnish the reports, statements and other documents required to be furnished
hereunder in the manner set forth herein.
2. DEFINITIONS. The terms set forth below shall have the following meanings in
this Agreement, unless the context clearly otherwise requires. Except as expressly otherwise
defined herein, capitalized terms used herein shall have the same meanings as defined in the
Indenture.
Annual Financial Information means the information described in Exhibit I attached
hereto.
Annual Financial Information Disclosure means the dissemination of disclosure
concerning Annual Financial Information and the dissemination of the Audited Financial
Statements as set forth in Section 5 hereof.
Annual Reports Filing Date means the date specified in Exhibit I for providing the Annual
Financial Information and the Audited Financial Statements to the MSRB.
Audited Financial Statements means the audited financial statements of the Issuer prepared
pursuant to the standards and as described in Exhibit I attached hereto.
Bond Insurer means
4870-2851-0113.3
Closing Date means the date on which the Bonds are issued pursuant to, and subject to the
terms of,the Indenture.
Commission means the Securities and Exchange Commission.
Consultant means DTA,formerly David Taussig&Associates, Inc.,and its successors and
assigns or any other firm selected by the Issuer to assist it in administering the Special Service
Area and the extension and collection of Special Taxes pursuant to the Special Tax Report.
Dissemination Agent means Amalgamated Bank of Chicago, acting in its capacity as
Dissemination Agent for the Issuer, or any other agent designated as such in writing by the Issuer
and which has filed with the Issuer a written acceptance of such designation, and such agent's
successors and assigns.
EMMA means the MSRB through its Electronic Municipal Market Access system for
municipal securities disclosure or through any other electronic format or system prescribed by the
MSRB for purposes of the Rule.
Event means the occurrence of any of the events with respect to the Bonds set forth in
Exhibit III attached hereto.
Exchange Act means the Securities Exchange Act of 1934, as amended.
Fiscal Year End means April 30 of each year, which is the last day of the Issuer's fiscal
year.
MSRB means the Municipal Securities Rulemaking Board.
Official Statement means the Official Statement dated March ,2024 of the Issuer relating
to the Bonds.
Participating Underwriter means each broker,dealer,or municipal securities dealer acting
as an underwriter in the primary offering of the Bonds.
Reportable Event means any the occurrence of any Event set forth in Exhibit III attached
hereto.
Reportable Events Disclosure means dissemination of a notice of a Reportable Event as set
forth in Section 6.
Rule means Rule 15c2-12 adopted by the Commission under the Exchange Act,as the same
may be amended from time to time.
Special Service Area means the United City of Yorkville Special Service Area Number
2004-107.
Special Services has the meaning as set forth in the Indenture.
Special Tax has the meaning as set forth in the Indenture.
2
4870-2851-0113.3
State means the State of Illinois.
Trustee means Amalgamated Bank of Chicago, Chicago, Illinois and its successors and
assigns, as trustee under the Indenture.
Undertaking means the obligations of the Issuer pursuant to Sections 5 and 6.
3. REPRESENTATIONS OF ISSUER. The Issuer represents that:
(a) It will be the only "obligated person" (within the meaning of paragraph (f)
(10) of the Rule) with respect to the Bonds at the time the Bonds are delivered to the beneficial
owner thereof and that no other person is expected to become so committed at any time after
issuance of the Bonds; and
(b) During the past five (5) years, the Issuer has not failed to comply, in all
material respects, with any previous undertakings it has entered into with respect to the Rule.
4. CUSIP NUMBERS. The CUSIP Numbers of the Bonds are set forth in Exhibit II.
The Issuer will, or will cause the Dissemination Agent to, include the CUSIP Numbers in all
disclosure materials described in Sections 5 and 6 of this Agreement.
5. ISSUER FINANCIAL INFORMATION DISCLOSURE.
(a) Subject to Section 9 of this Agreement, the Issuer hereby covenants that,
from and after the Closing Date, it will disseminate, or cause the Dissemination Agent to
disseminate, its Annual Financial Information and its Audited Financial Statements (in the form
and by the dates set forth in Exhibit I) to the MSRB through EMMA in such manner and format
and accompanied by identifying information as is prescribed by the MSRB or the Commission at
the time of delivery of such information and by such time so that such entities receive the
information by the dates specified.
(b) If any part of the Annual Financial Information can no longer be generated
because the operations to which it is related have been materially changed or discontinued, the
Issuer will, or cause the Dissemination Agent to, disseminate to the MSRB a statement to such
effect as part of its Financial Information for the year in which such event first occurs.
(c) If any amendment or waiver is made to this Agreement, the Annual
Financial Information for the year in which such amendment or waiver is made (or in any notice
or supplement provided to EMMA) shall contain a narrative description of the reasons for such
amendment or waiver and its impact on the type of information being provided.
(d) Within ten(10)business days of receipt thereof, and not later than 240 days
after the Issuer's Fiscal Year End,the Issuer shall provide the Annual Financial Information to the
Dissemination Agent and the Bond Insurer. The Dissemination Agent shall notify the Issuer in
the event it does not receive such report. The Issuer may seek the assistance of the Consultant in
preparing the Annual Financial Information.
3
4870-2851-0113.3
(e) If the Issuer changes its Fiscal Year End, it shall give notice of such change
in the same manner as for a Reportable Event under Section 6 below.
(f) By no later than fifteen (15) business days prior to the applicable Annual
Reports Filing Date, the Issuer shall provide its Annual Financial Information and, if applicable,
its Audited Financial Statements, to the Dissemination Agent for filing with the MSRB through
EMMA by no later than the Annual Reports Filing Date. If, by such 15th business day prior to the
Annual Reports Filing Date, the Dissemination Agent has not received copies of the Annual
Financial Information and the Audited Financial Statements from the Issuer, the Dissemination
Agent shall contact the Issuer to determine if the Issuer is in compliance with its obligations
hereunder.
(g) If the Dissemination Agent is unable to verify that the Issuer has provided
the Annual Financial Information and the Audited Financial Statements to the MSRB by the
Annual Reports Filing Date, the Dissemination Agent shall promptly send a notice to the MSRB
through EMMA in substantially the form attached hereto as Exhibit IV.
(h) The Dissemination Agent shall:
(i) determine each year, prior to the Annual Reports Filing Date, the
applicable electronic format for filings through EMMA;
(ii) file the Annual Financial Information and the Audited Financial
Statements (if timely received from the Issuer)with the MSRB through EMMA by
the Annual Reports Filing Date;
(iii) file a report with the Issuer certifying that the Annual Financial
Information and the Audited Financial Statements have been provided to the MSRB
pursuant to this Agreement and stating the date that such Annual Financial
Information and Audited Financial Statements were provided to the MSRB; and
(iv) file such other Annual Financial Information with the MSRB upon
receipt of same from the Issuer.
6. REPORTABLE EVENTS DISCLOSURE.
(a) Subject to Section 9 of this Agreement, the Issuer hereby covenants that it
will, or cause the Dissemination Agent to, disseminate in a timely manner (not in excess of ten
(10)business days after the occurrence of the Event giving rise to the Reportable Event)Reportable
Events Disclosure to the MSRB through EMMA in such manner and format and accompanied by
identifying information as is prescribed by the MSRB or the Commission at the time of delivery
of such information.
(b) The Issuer may from time to time choose to provide notice of the occurrence
of certain other events, in addition to the Reportable Events, if, in the judgment of the Issuer, such
other event is material with respect to the Bonds, but the Issuer does not undertake any
commitment to provide such notice of any event except for the Reportable Events.
4
4870-2851-0113.3
(c) MSRB Rule G-32 requires all EMMA filings to be in word-searchable PDF
format. This requirement extends to all documents to be filed with EMMA, including financial
statements and other externally prepared reports.
(d) Notwithstanding the foregoing, notice of optional or unscheduled
redemption of any Bonds or defeasance of any Bonds need not be given under this Agreement any
earlier than the notice (if any) of such redemption or defeasance is given to the Bondholder
pursuant to the Bond Ordinance.
(e) In connection with providing a notice of the occurrence of a Reportable
Event,the Dissemination Agent, solely in its capacity as such, is not obligated or responsible under
this Agreement to determine the sufficiency of the content of the notice for purposes of the Rule
or any other state or federal securities law, rule, regulation or administrative order.
(f) The Dissemination Agent shall, promptly upon obtaining actual knowledge
at its office specified in Section 13 below of the occurrence of any of the Events,contact the Issuer
to inform the Issuer of the occurrence of such Event and request that the Issuer promptly notify
the Dissemination Agent in writing whether or not to report such Event to the MSRB as a
Reportable Event pursuant to Section 6(h) below; provided, however, that the failure by the
Dissemination Agent to so notify the Issuer and make such request shall not relieve the Issuer of
its duty to report Reportable Events as required by this Agreement.
(g) Whenever the Issuer obtains knowledge of the occurrence of an Event,
whether because of notice from the Dissemination Agent pursuant to Section 6(f) above or
otherwise, the Issuer shall determine as soon as possible (but in no event in excess of ten (10)
business days after the occurrence of the Event giving rise to the Reportable Event) if such Event
is a Reportable Event which is required to be reported to the MSRB pursuant to the Rule and this
Section 6. In the event the Issuer determines that such Event is not a Reportable Event,the Issuer
shall promptly notify the Dissemination Agent in writing and instruct the Dissemination Agent to
not report such Event.
(h) If, however, the Issuer determines that an Event is a Reportable Event
required to be reported to the MSRB pursuant to the Rule and this Section 6, the Issuer shall
promptly notify the Dissemination Agent in writing and instruct the Dissemination Agent to report
such Reportable Event, in which event the Dissemination Agent shall file a notice of such
Reportable Event with the MSRB through EMMA in an electronic format and accompanied by
such identifying information as is prescribed by the MSRB. Such notice shall in no event be filed
later than ten (10) business days after the occurrence of the Event giving rise to the Reportable
Event.
(i) The Dissemination Agent may conclusively rely on an opinion of counsel
that the Issuer's instructions to the Dissemination Agent under this Section 6 comply with the
requirements of the Rule.
7. CONSEQUENCES OF FAILURE OF THE ISSUER TO PROVIDE
INFORMATION. The Issuer shall give, or cause the Dissemination Agent to give, notice in a
5
4870-2851-0113.3
timely manner to EMMA of any failure to provide Annual Financial Information Disclosure when
the same is due hereunder.
In the event of a failure of the Issuer or Dissemination Agent to comply with any of its
obligations under this Agreement, the beneficial owner of any Bonds may seek mandamus or
specific performance by court order, to cause the Issuer or Dissemination Agent, as the case may
be,to comply with its obligations under this Agreement. A default under this Agreement shall not
be deemed a default under the Bond Ordinance or the Indenture, and the sole remedy under this
Agreement in the event of any failure of the Issuer or Dissemination Agent to comply with this
Agreement shall be an action to compel performance.
8. AMENDMENTS; WAIVER. Notwithstanding any other provision of this
Agreement, the Issuer by ordinance or resolution authorizing such amendment or waiver, may
amend this Agreement, and any provision of this Agreement may be waived, if:
(a) (i) The amendment or waiver is made in connection with a change in
circumstances that arises from a change in legal requirements, including without limitation,
pursuant to a "no-action" letter issued by the Commission, a change in law, or a change in the
identity, nature, or status of the Issuer, or type of business conducted; or
(ii) This Agreement, as amended, or the provision, as waived, would
have complied with the requirements of the Rule at the time of the primary offering,
after taking into account any amendments or interpretations of the Rule, as well as
any change in circumstances; and
(b) The amendment or waiver does not materially impair the interests of the
beneficial owners of the Bonds,as determined by parties unaffiliated with the Issuer(such as Bond
Counsel)at the time of the amendment.
In the event that the Commission or the MSRB or other regulatory authority shall approve
or require Annual Financial Information Disclosure or Reportable Events Disclosure to be made
to a central post office, governmental agency or similar entity other than EMMA or in lieu of
EMMA,the Issuer or the Dissemination Agent shall, if required, make such dissemination to such
central post office, governmental agency or similar entity without the necessity of amending this
Agreement.
9. TERMINATION OF UNDERTAKING. The Undertaking of the Issuer, and the
obligations of the Dissemination Agent hereunder, shall be terminated hereunder if the Issuer shall
no longer have any legal liability for any obligation on or relating to repayment of the Bonds
(including defeasance of the Bonds) under the Bond Ordinance and the Indenture. The Issuer
shall, or cause the Dissemination Agent to, give notice to the MSRB through EMMA in a timely
manner if this Section is applicable.
10. DISSEMINATION AGENT. The Issuer may, from time to time, appoint or
engage a Dissemination Agent to assist it in carrying out its obligations under this Agreement,and
may discharge any such Dissemination Agent, with or without appointing a successor
Dissemination Agent. The Issuer hereby appoints Amalgamated Bank of Chicago as the
Dissemination Agent. The Dissemination Agent may resign by providing sixty (60)days' written
6
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notice to the Issuer. The Dissemination Agent shall not be responsible in any manner for the
contents of any notice or report prepared by the Issuer pursuant to this Agreement.
11. ADDITIONAL INFORMATION. Nothing in this Agreement shall be deemed to
prevent the Issuer from disseminating any other information, using the means of dissemination set
forth in this Agreement or any other means of communication, or including any other information
in any Annual Financial Information Disclosure or notice of occurrence of a Reportable Event, in
addition to that which is required by this Agreement. If the Issuer chooses to include any
information from any document or notice of occurrence of a Reportable Event in addition to that
which is specifically required by this Agreement, the Issuer shall have no obligation under this
Agreement to update such information or include it in any future disclosure or notice of occurrence
of a Reportable Event.
12. DUTIES, IMMUNITIES AND LIABILITIES OF DISSEMINATION
AGENT. The Dissemination Agent shall have only such duties as are specifically set forth in this
Agreement.
13. NOTICES. Any notices or communications to or among any of the parties to this
Agreement may be given as follows:
To the Issuer: United City of Yorkville
651 Prairie Pointe Drive
Yorkville, IL 60560
Attention: Mayor
Telephone: (630) 553-4350
To the Dissemination Agent: Amalgamated Bank of Chicago
30 N. LaSalle Street
38th Floor
Chicago, IL 60602
Attention:
Telephone: (312) 822-3187
14. BENEFICIARIES. This Agreement has been executed in order to assist the
Underwriter in complying with the Rule; however,this Agreement shall inure solely to the benefit
of the Issuer, the Dissemination Agent and the beneficial owners of the Bonds and shall create no
rights in any other person or entity.
15. RECORDKEEPING. The Issuer shall maintain records of all Annual Financial
Information Disclosure and Reportable Events Disclosure, including the content of such
disclosure, the names of the entities with whom such disclosure was filed and the date of filing
such disclosure.
16. ASSIGNMENT. The Issuer shall not transfer its obligations under the Bond
Ordinance unless the transferee agrees to assume all obligations of the Issuer under this Agreement
or to execute an Undertaking under the Rule.
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17. GOVERNING LAW. This Agreement shall be governed by the laws of the State
of Illinois applicable to contracts performed wholly therein and without reference to its conflict of
laws principles, provided that to the extent this Agreement addresses matters of federal securities
laws, including the Rule, this Agreement shall be construed in accordance with such federal
securities laws and official interpretations thereof.
(Signature page follows)
8
4870-2851-0113.3
UNITED CITY OF YORKVILLE,
ILLINOIS
By:
Mayor
Continuing Disclosure Undertaking
4870-2851-0113.3
ACCEPTANCE BY DISSEMINATION AGENT
Amalgamated Bank of Chicago hereby accepts its appointment as Dissemination Agent
hereunder and agrees to perform the services of Dissemination Agent hereunder.
AMALGAMATED BANK OF CHICAGO,
as Dissemination Agent
By:
Its:
Continuing Disclosure Undertaking
4870-2851-0113.3
EXHIBIT I
ANNUAL FINANCIAL INFORMATION AND TIMING AND
AUDITED FINANCIAL STATEMENTS
All or a portion of the Annual Financial Information and the Audited Financial Statements
as set forth below may be included by reference to other documents which have been submitted to
EMMA or filed with the Commission. If the information included by reference is contained in the
Official Statement, the Official Statement must be available on EMMA; the Official Statement
need not be available from the Commission. The Issuer shall clearly identify each such item of
information included by reference.
a. Annual Financial Information:
1. "Annual Financial Information" means the annual report prepared by the
Consultant showing the Special Taxes received, all disbursements from the
Funds and Accounts administered by the Indenture, including the balances
in all Funds and Accounts relating to the Bonds and the Special Services as
of the end of such fiscal year, and the collection of taxes, delinquencies,tax
sales and foreclosures and the payment of recapture to the Issuer and
remitted to the Trustee for payment of the Bonds.
2. The Annual Financial Information will be submitted to EMMA within ten
(10) business days of receipt thereof and not later than 240 days after the
Issuer's Fiscal Year End.
b. Audited Financial Statements:
1. "Audited Financial Statements" means the general purpose financial
statements of the Issuer prepared in accordance with generally accepted
auditing standards and "Government Auditing Standards" issued by the
Comptroller of the United States.
2. Audited Financial Statements will be submitted to EMMA in such format
and manner and accompanied by identifying information as is prescribed by
the MSRB, at the same time as the Annual Financial Information.
Audited Financial Statements as described above should be filed at the same time as the
Annual Financial Information. If Audited Financial Statements are not available when the Annual
Financial Information is filed, unaudited financial statements shall be included, and Audited
Financial Statements will be filed when available.
The Issuer shall file with the Dissemination Agent and the Bond Insurer(a)forthwith upon
becoming aware of any Event of Default or other event which, with the lapse of time specified in
the Indenture, would become an Event of Default, a Written Certificate of the Issuer specifying
such Event of Default or other event; and(b) within 240 days after the Issuer's Fiscal Year End, a
written certificate of the Issuer stating that, to the best of knowledge and belief of the authorized
officer of the Issuer executing such written certificate, the Issuer has kept, observed, performed
Exhibit I-1
4870-2851-0113.3
and fulfilled each and every one of its covenants and obligations contained in the Indenture and
there does not exist at the date of such certificate any default by the Issuer under the Indenture or
any Event of Default or other event which, with the lapse of time, would become an Event of
Default, or, if any such Event of Default or other event shall so exist, specifying the same and the
nature and status thereof.
If any change is made to the Annual Financial Information as permitted by Section 5 of
this Agreement,the Issuer will disseminate a notice of such change as required by Section 5.
Exhibit I-2
4870-2851-0113.3
EXHIBIT II
CUSIP NUMBERS
Maturity
(March 1) CUSIP
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
Exhibit II
4870-2851-0113.3
EXHIBIT III
EVENTS WITH RESPECT TO THE BONDS
FOR WHICH REPORTABLE EVENTS DISCLOSURE IS REQUIRED
1. Principal and interest payment delinquencies
2. Non-payment related defaults, if material
3. Unscheduled draws on debt service reserves reflecting financial difficulties
4. Unscheduled draws on credit enhancements reflecting financial difficulties
5. Substitution of credit or liquidity providers, or their failure to perform
6. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final
determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax status of the security, or other
material events affecting the tax status of the Bonds
7. Modifications to the rights of Bondholders, if material
8. Bond calls, if material, and tender offers
9. Defeasances
10. Release, substitution or sale of property securing repayment of the Bonds, if material
11. Rating changes
12. Bankruptcy, insolvency,receivership or similar event of the Issuer(this event is considered
to occur when any of the following occur: the appointment of a receiver, fiscal agent or
similar officer for the Issuer in a proceeding under the U.S. Bankruptcy Code or in any
other proceeding under state or federal law in which a court or governmental authority has
assumed jurisdiction over substantially all of the assets or business of the Issuer, or if such
jurisdiction has been assumed by leaving the existing governing body and officials or
officers in possession but subject to the supervision and orders of a court or governmental
authority, or the entry of an order confirming a plan of reorganization, arrangement or
liquidation by a court or governmental authority having supervision or jurisdiction over
substantially all of the assets or business of the Issuer)
13. The consummation of a merger, consolidation, or acquisition involving the Issuer or the
sale of all or substantially all of the assets of the Issuer, other than in the ordinary course
of business, the entry into a definitive agreement to undertake such an action or the
termination of a definitive agreement relating to any such actions, other than pursuant to
its terms, if material
Exhibit III-1
4870-2851-0113.3
14. Appointment of a successor or additional trustee or the change of name of a trustee, if
material
15. incurrence of a financial obligation of the City, if material, or agreement to covenants,
events of default, remedies, priority rights, or other similar terms of a financial obligation
of the City, any of which affect security holders, if material
16. default, event of acceleration, termination event, modification of terms, or other similar
events under the terms of a financial obligation of the City, any of which reflect financial
difficulties
For purposes of the Rule, "financial obligation" means a (i) debt obligation, (ii) derivate
instrument entered into in connection with or pledged as a security or a source of payment for, an
existing or planned debt obligation, or (iii) a guarantee of any of the foregoing. Financial
obligation does not include municipal securities as to which a final official statement has been
provided to the MSRB.
Exhibit III-2
4870-2851-0113.3
EXHIBIT IV
FORM OF NOTICE TO MSRB OF FAILURE TO FILE ANNUAL REPORT
Name of Issuer: United City of Yorkville, Kendall County, Illinois ("Issuer")
Issue: Special Service Area Number 2004-107
Special Tax Refunding Bonds, Series 2024 (Raintree Village II Project)
(the "Bonds")
Date of Issuance: March , 2024
NOTICE IS HEREBY GIVEN that the Issuer has not provided its Annual Financial
Information and its Audited Financial Statements with respect to the Bonds as required by the
Continuing Disclosure Undertaking dated March _, 2024 by the Issuer and accepted by
Amalgamated Bank of Chicago as Dissemination Agent. [The Issuer anticipates that the Annual
Financial Information and Audited Financial Statements will be filed by .]
Dated:
AMALGAMATED BANK OF
CHICAGO, as Dissemination Agent
By:
Its:
Exhibit IV-1
4870-2851-0113.3
Exhibit F
Form of the Agreement for Administrative Services
(See attached)
51642736.6
APr
www.FinanceDTA.com
AGREEMENT FOR
CONSULTING SERVICES
SPECIAL SERVICE AREA NO. 2004-107
UNITED CITY OF YORKVILLE, IL
SPECIAL SERVICE AREA ADMINISTRATION
SERVICES
March 7, 2024
Public Finance
Public-Private Partnerships
Development Economics
Clean Energy Bonds
dta/www.FinanceDTA.com
AGREEMENT FOR CONSULTING SERVICES
THIS AGREEMENT is made and entered into this day of March of 2024, by and
between the United City of Yorkville at 800 Game Farm Road, Yorkville, IL, 60560, herein
called "Client," and DTA at 18201 Von Karman Avenue, Suite 220, Irvine, CA 92612, herein
after called "Consultant." The Client and the Consultant in consideration of the mutual
promises and conditions herein contained agree as follows.
ARTICLE I
DISCLOSURES AND TERM OF CONTRACT
Section 1.1 As of the date of this Agreement, there are no actual or potential
conflicts of interest that DTA is aware of that might impair its ability to render unbiased and
competent advice or to fulfill its fiduciary duty. If DTA becomes aware of any potential
conflict of interest that arise after this disclosure, DTA will disclose the detailed information
in writing to the Client in a timely manner.
Section 1.2 DTA, a Securities and Exchange Commission ("SEC") and MSRB
registered firm, does not have any legal events and disciplinary history on its Form MA and
Form MA-I, which includes information about any criminal actions, regulatory actions,
investigations, terminations, judgments, liens, civil judicial actions, customer complaints,
arbitrations and civil litigation. The Client may electronically access DTA's most recent
Form MA and each most recent Form MA-I filed with the Commission at the following
website:
https://www.sec.gov/edgar/searchedgar/companysearch.html
Section 1.3 While DTA has a fiduciary responsibility as a licensed Municipal
Advisor, DTA is not, unless otherwise stipulated, acting as the Client's Municipal Advisor.
The services discussed herein do not constitute any financial advice or fall under the
category of municipal advisory services as defined by the SEC.
Section 1.4 This agreement shall become effective on the date stated above and
will continue in effect until the earlier of (i) that day when the services provided for herein
have been performed or (ii) until terminated as provided in Article 6 below.
ARTICLE II
SERVICES TO BE PERFORMED BY CONSULTANT
Section 2.1 Consultant agrees to perform the professional services for the Client,
herein after called"Project,"in accordance with the applicable professional standard of care
and to deliver the work products to the Client as described in the Scope of Work statement
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attached as Exhibit "A"hereto. Such professional services and work products, as from time
to time modified in accordance with Section 2.3 hereof, are collectively referred to as the
"Consulting Services."
Section 2.2 Instruments of Service. All computer software (including without
limitation financial models, compilations of formulas and spreadsheet models), inventions,
designs, programs, improvements, processes and methods (collectively, the "Proprietary
Models"), reports, drawings, specifications, computer files, field data, notes and other
documents and instruments prepared by Consultant are Instruments of Service of
Consultant and shall remain the property of Consultant. Consultant shall likewise retain all
common law, statutory and other reserved rights, including the copyright thereto. Client
acknowledges and agrees that the consideration paid by Client herein only entitles Client
to a license to use the hard copy or electronically transmitted reports generated pursuant
to the Consulting Services and that any Proprietary Model that Consultant uses to generate
such reports is owned by, or is duly licensed from a third party to Consultant and is not
being provided to Client hereunder. The reports and models used to generate such reports
are for use on this Project only. The Client shall not reuse or make any modification to the
hard copy or electronically transmitted reports generated pursuant to the Consulting
Services without the prior written authorization of the Consultant. The Client agrees,to the
fullest extent permitted by law, to indemnify and hold harmless the Consultant, its
shareholders, officers, directors, employees and subconsultants (collectively, Consultant's)
against any damages, liabilities or costs, including reasonable attorneys' par fees and
defense costs, arising from or allegedly arising from or in any way connected with the
unauthorized use, reuse or modification of the hard copy or electronically transmitted
reports generated pursuant to the Consulting Services or any of Consultant's Instruments
of Service, including models, by the Client or any person or entity that acquires or obtains
the reports from or through the Client without the written authorization of the Consultant.
Client acknowledges that Consultant may have used reports and analyses that Consultant
authored for other clients as base works or templates for the reports and analyses prepared
for Client pursuant to this Agreement, and Client acknowledges and agrees that Consultant
has the right to use the reports and analyses that it authors pursuant to this Agreement as
base works or templates for reports and analyses that Consultant authors for Consultant's
other clients,provided,however that Consultant shall not use any confidential information
provided by Client in such future reports and analyses. Client further acknowledges and
agrees that Consultant has spent substantial time and effort in collection and compiling
data and information (the "Data Compilations") in connection with the Consulting Services
and that such Data Compilations may be used by Consultant for its own purposes,including,
without limitation, sale or distribution to third parties; provided, however, that Consultant
will not sell or distribute any of Client's confidential information that may be contained in
such Data Compilations,unless such confidential information is used only on an aggregated
and anonymous basis.
Section 2.3 Any proposed changes in the Consulting Services hereunder shall be
submitted to the other party hereto, and any such changes agreed to by the parties shall be
reflected in an amendment to Exhibit "A" in accordance with Section 7.2 hereto.
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Section 2.4 Nothing in this Agreement shall give the Consultant possession of
authority with respect to any Client decision beyond the rendition of information, advice,
recommendation, or counsel.
ARTICLE III
COMPENSATION
Section 3.1 Client agrees to pay Consultant for its Consulting Services in
accordance with this Agreement,a professional fee computed according to the Professional
Fee Schedule attached as Exhibit "B" hereto and incorporated herein by reference (the "Fee
Schedule"). Client acknowledges and agrees that portions of Consultant's professional fees
and expenses may have been incurred by Consultant prior to the execution of this
Agreement (the "Pre-Agreement Fees") and Client agrees to pay such Pre-Agreement Fees
in accordance with this Agreement.
Section 3.2 The Client shall reimburse the Consultant for out-of-pocket and
administrative expenses by paying a charge equal to 3%of DTA's monthly billings. Expenses
shall include all actual expenditures made by Consultant in the performance of any
Consulting Services undertaken pursuant to the Agreement, including, without limitation,
the following expenditures:
(a) Cost of clerical assistance, including typing, collation, printing and copying,
plus copier and photography costs, including photographic reproduction of
drawings and documents.
(b) Transportation costs, including mileage for the use of personal automobiles
at the prevailing IRS standard rate, rental vehicles, lodging and regularly
scheduled commercial airline ticket costs.
(c) Courier services, facsimile, and telephone expenses.
Section 3.3 On or about the first two weeks of each month during which
Consulting Services are rendered hereunder, Consultant shall present to Client an invoice
covering the current Consulting Services performed and the reimbursable expenses
incurred pursuant to this Agreement and exhibits thereto. Such invoices shall be paid by
Client within thirty (30) days of the date of each invoice. A 1.2% charge may be imposed
against accounts which are not paid within 30 days of the date of each invoice.
Section 3.4 The maximum total fee amount set forth in Exhibit "B" may be
increased as a result of any expansion of the Consulting Services to be rendered hereunder
pursuant to Section 2.3 or as provided in Exhibit "A"hereto.
Section 3.5 Records of the Consultant's costs relating to (i) Consulting Services
performed under this Agreement and (ii) reimbursable expenses shall be kept and be
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available to the Client or to Client's authorized representative at reasonable intervals during
normal business hours.
ARTICLE IV
OTHER OBLIGATIONS OF CONSULTANT
Section 4.1 Consultant agrees to perform the Consulting Services in accordance
with Exhibit "A" and the applicable standard of care. Should any errors caused by
Consultant's negligence be found in such services or products,Consultant will correct them
at no additional charge by revising the work products called for in Exhibit "A" to eliminate
the errors.
Section 4.2 Consultant will supply all tools and instrumentalities required to
perform the Consulting Services under the Agreement.
Section 4.3 Neither this Agreement nor any duties or obligations under this
Agreement may be assigned by Consultant without the prior written consent of Client.
However, Consultant may subcontract portions of the work to be performed hereunder to
other persons or concerns provided Consultant notifies Client of the name and address of
said proposed subcontractor and Client either consents or fails to respond to notification
with respect to the use of any particular proposed subcontractor.
Section 4.4 In the performance of its Consulting Service hereunder, Consultant is,
and shall be deemed to be for all purposes, an independent contractor (and not an agent,
officer, employee or representative of Client) under any and all laws, whether existing or
future. Consultant is not authorized to make any representation, contract, or commitment
on behalf of Client.
ARTICLE V
OTHER OBLIGATIONS OF CLIENT
Section 5.1 The Client shall provide full information in a timely manner regarding
requirements for and limitations on the Project. Client agrees to comply with all reasonable
requests of Consultant and provide access to all documents reasonably necessary to the
performance of Consultant's duties under this Agreement with the exception of those
documents which Exhibit "A" calls upon the Consultant to prepare.
Section 5.2 Neither this Agreement nor any duties or obligations under this
Agreement may be assigned by Client without the prior written consent of Consultant.
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Section 5.3 The Client shall provide prompt written notice to the Consultant if the
Client becomes aware of any fault or defect in the Project, including any errors, omissions,
or inconsistencies in the Consultant's Instruments of Service.
Section 5.4 Client, public agencies, landowners, consultants and other parties
dealing with Client or involved in the subject development project referred to in Exhibit"A"
will be furnishing to Consultant various data,reports,studies,computer printouts and other
information and representations as to the facts involved in the project which Client
understands Consultant will be using and relying upon in preparing the reports, studies,
computer printouts and other work products called for by Exhibit "A." Consultant shall not
be obligated to establish or verify the accuracy of the information furnished by or on behalf
of Client, nor shall Consultant be responsible for the impact or effect on its work products
of the information.furnished by or on behalf of Client, in the event that such information is
in error and therefore introduces error into Consultant's work products.
Section 5.5 In the event that court appearances, testimony or depositions are
required of Consultant by Client in connection with the services rendered hereunder,Client
shall compensate Consultant at a rate of $400 per hour and shall reimburse Consultant for
out-of-pocket expenses on a cost basis.
ARTICLE VI
TERMINATION OF AGREEMENT
Section 6.1 Either party may terminate or suspend this Agreement upon thirty(30)
days written notice. Unless terminated as provided herein, this Agreement shall continue
in force until the Consulting Services set forth in Exhibit "A"have been fully and completely
performed and all proper invoices have been rendered and paid.
Section 6.2 Should either party default in the performance of this Agreement or
materially breach any of its provisions, the other party at its option may terminate this
Agreement by giving written notification to the defaulting party. Such termination shall be
effective upon receipt by the defaulting party, provided that the defaulting party shall be
allowed ten (10) days in which to cure any default following receipt of notice of same.
Section 6.3 In the event of any termination that is not the fault of the Consultant,
the Client shall pay the Consultant, in addition to payment for services rendered and
reimbursable costs incurred, for all expenses reasonably incurred by the Consultant in
connection with the orderly termination of this Agreement, including but not limited to
demobilization, reassignment of personnel, associated overhead costs and all other
expenses directly resulting from the termination, plus an amount for the Consultant's
anticipated profit on the value of the services not performed by the Consultant.
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Section 6.4 Suspension and Termination for Non-Payment. (i) In addition to any
other provisions in this Agreement regarding breach of the Agreement, if the Client fails to
make payments when due, the Consultant may suspend performance of services upon ten
(10) calendar days'notice to the Client.The Consultant shall have no liability whatsoever to
the Client for any costs or damages as a result of such suspension caused by any breach of
this Agreement by the Client. Upon payment in full by the Client, the Consultant shall
resume services under this Agreement, and the time schedule and compensation shall be
equitably adjusted to compensate for the period of suspension plus any other reasonable
time and expense necessary for the Consultant to resume performance. (ii) If the Client
fails to make payment to the Consultant in accordance with the payment terms herein,
and/or Client has failed to cure its breach or default following a suspension of services as
set forth above, this shall constitute a material breach of this Agreement and shall be cause
for termination of this Agreement by the Consultant upon seven (7) days written notice to
the Client. (iii) Payment of invoices shall not be subject to any discounts or set-offs by the
Client,unless agreed to in writing by the Consultant.Payment to the Consultant for services
rendered and expenses incurred shall be due and payable regardless of any subsequent
suspension or termination of this Agreement by either party.
Section 6.5 The covenants contained in Sections 3.1, 3.2, 4.4, 5.3, 5.4 and all of
Article VII shall survive the termination of this Agreement.
ARTICLE VII
GENERAL PROVISIONS
Section 7.1 Any notices to be given hereunder by either party to the other may be
affected either by personal delivery in writing or by mail. Mailed notices shall be addressed
to the parties at the addresses appearing in the introductory paragraph of this Agreement,
but each party may change the address by written notice in accordance with the first
sentence of this Section 7.1. Notices delivered personally will be deemed communicated as
of actual receipt. Mailed notices will be deemed communicated as of two (2) days after
mailing.
Section 7.2 This Agreement and exhibits hereto supersede any and all agreements,
either oral or written, between the parties hereto with respect to the rendering of service
by Consultant for Client and contains all of the covenants and agreements between the
parties with respect to the rendering of such services. Each party to this Agreement
acknowledges that no representations, inducements, promises, or agreements, orally or
otherwise, have been made by any party, or anyone acting on behalf of any party, which
are not embodied herein, and that no other agreement, statement, or promise not
contained in this Agreement shall be valid or binding. Any modification of this Agreement
(including any exhibit hereto) will be effective if it is in writing and signed by the party
against whom it is sought to be enforced.
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Section 7.3 If any provision in this Agreement is held by a court of competent
jurisdiction to be invalid,void, or unenforceable, the remaining provisions will nevertheless
continue in full force without being impaired or invalidated in any way.
Section 7.4 Disputes. The parties agree to first try in good faith to settle the dispute
by mediation pursuant to the Mediation Rules of the American Arbitration Association. If
the claim or controversy is not settled by mediation, the claim or controversy may be
resolved by final and binding arbitration. On the written request of one party served on the
other, the dispute shall be submitted to binding arbitration in accordance with the
commercial rules and regulations of the American Arbitration Association. The arbitration
shall take place at the location in which the principal office of the Respondent is situated,
or such other location as may be mutually agreed to by the parties.
The arbitrator(s) shall be selected as follows: In the event that Consultant and Client
agree on one arbitrator, the arbitration shall be conducted by such arbitrator. In the event
Consultant and Client do not so agree, Consultant and Client shall each select an arbitrator
and the two arbitrators so selected shall select the third arbitrator. If there is more than one
arbitrator, the arbitrators shall act by majority vote. The parties may propose arbitrators
from JAMS, ADR, ARC or any independent arbitrator/neutral for dispute resolution. The
parties are not required to hire a AAA arbitrator for resolution of a dispute hereunder.
No arbitration shall include by way of consolidation or joinder any parties or entities
not a party to this Agreement without the express written consent of the Client, the
Consultant and any party or entity sought to be joined with an express reference to this
provision. Any party or entity joined in the arbitration,after mutual consent,shall be bound
by this provision.
The decree or judgment of an award rendered by the arbitrator(s) may be entered in
any court having jurisdiction thereof.
Section 7.5 The prevailing party in any arbitration or legal action brought by one
party against the other and arising out of this Agreement shall be entitled,in addition to any
other rights and remedies it may have, to reimbursement for its expenses, including court
costs and reasonable attorneys' fees. The non-prevailing party shall be liable, to the extent
allowable under law, for all fees and expenses of the arbitrator(s) and all costs of the
arbitration.
Section 7.6 This Agreement will be governed by and construed in accordance with
the laws of the State of Illinois.
Section 7.7 Nothing contained in this Agreement shall create a contractual
relationship with or a cause of action in favor of a third party against either the Client or the
Consultant.The Consultant's services under this Agreement are being performed solely for
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the Client's benefit, and no other party or entity shall have any claim against the Consultant
because of this Agreement or the performance or nonperformance of services hereunder.
Section 7.8 Notwithstanding any other provision of this Agreement, and to the
fullest extent permitted by law, neither the Consultant nor the Client, their respective
officers, directors, partners, employees, contractors or subconsultants shall be liable to the
other for, or shall make, any claim for any incidental, indirect or consequential damages
arising out of or connected in any way to the Project or to this Agreement. This mutual
waiver of consequential damages shall include,but is not limited to,loss of use,loss of profit,
loss of business,loss of income,loss of reputation or any other consequential damages that
either party may have incurred from any cause of action including negligence,strict liability,
breach of contract and breach of strict or implied warranty.
Section 7.9 It is intended by the parties to this Agreement that the Consultant's
services in connection with the Project shall not subject the Consultant's individual
shareholders, officers, directors, members, managers or employees to any personal legal
exposure for the risks associated with this Project. Therefore,and notwithstanding anything
to the contrary contained herein, Client agrees that as Client's sole and exclusive remedy,
any claim, demand or suit shall be directed and/or asserted only against Consultant and not
against any of the individual shareholders, officers, directors, members, managers or
employees.
Section 7.10 Limitation of Liability - for available insurance: In recognition of the
relative risks and benefits of the Project to both the Client and the Consultant,the risks have
been allocated such that the Client agrees,to the fullest extent permitted by law, to limit the
liability of the Consultant to the Client for any and all claims, losses, costs, damages of any
nature whatsoever or claims expenses from any cause or causes, including attorneys' fees
and costs and expert-witness fees and costs, so that the total aggregate liability of the
Consultant to the Client shall not exceed the sum of insurance coverage available at the
time of settlement or judgment. It is intended that this limitation apply to any and all liability
or cause of action however alleged or arising, except for Consultant's willful misconduct or
unless otherwise prohibited by law.
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IN WITNESS WHEREOF, this Agreement has been executed on the date and year first
above written.
CONSULTANT: CLIENT:
David Taussig and Associates, Inc. United City of Yorkville
d/b/a DTA
By: By:
Kelly Wright, Chief Executive Officer
Date: Date:
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SCOPE OF WORK
The Scope of Work statement is predicated on the assumption that the special taxes for the
United City of Yorkville ("City") Special Service Area No.2004-107(hereinafter called"SSA")will
be billed and collected by the County of Kendall (the "County"). The Scope of Work statement
for the administration of the SSA is comprised of those services associated with the annual
calculation and billing of the special taxes, review of bond funds and accounts, responses to
taxpayer inquiries (i.e.,phone calls,prepayment requests,builder education/coordination),and
determination of arbitrage/rebate liability as follows:
Task 1 —Development Research and SSA Parcel Database
This task involves gathering and organizing the information required to establish and maintain
parcel databases necessary to extend, bill, and collect the special taxes, pursuant to the SSA
Special Tax Roll and Report,as amended,and includes the following:
1.1 Subdivision Research: Coordinate with the City and the builder(s) to obtain copies of
all final plats. Identify recording date,property use, acreage,and the lot, block and unit
numbers,as applicable,for each new parcel.
1.2 Permanent Index Numbers:Coordinate with the County to determine valid Permanent
Index Numbers ("PIN")for the coming year and obtain new cadastral maps.
1.3 Classification of Property: Assign each parcel to the appropriate special tax
classification in accordance with the respective SSA Special Tax Roll and Report, as
amended.
1.4 SSA Parcel Database: Establish and maintain parcel databases for the SSA that will
include all relevant PINs,property data,and special tax characteristics.
Task 2 —Special Tax Requirement Calculation and Special Tax Abatement
This task involves calculating the amount of special tax to be abated for the SSA and includes
the following subtasks:
2.1 Bond Funds Accountability Analysis: This task involves the review and analysis of
account statements for the funds and accounts maintained by the trustee. Consultant
will prepare a monthly report that summarizes the activity for each fund and account
and evaluates flow of funds for consistency with the Indenture or other controlling
documents. When necessary, Consultant will communicate our findings with the City
or trustee.
2.2 Determine Annual Expenses: Identify expenses for the SSAs including annual debt
service,administrative expenses,and provision for delinquencies.
2.3 Year-End Reconciliation: Prepare year-end reconciliation to determine surplus funds,
if any, in the bond funds and accounts,interest earnings, and other credits that may be
applied to toward the abatement of the special tax.
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2.4 Extension of Special Taxes: Extend the required special taxes to each PIN pursuant to
the respective SSA Special Tax Roll and Report,as amended,and determine the resulting
amount to be abated, if any.
Task 3 - Report Preparation
This task includes the preparation of an Annual Report for the SSAs,which will generally contain
the following:
• Brief development summary;
• Flow of funds summary;
• Special tax collection,tax sale,and foreclosure status;
• Bond fund and account balance summary;
• Special tax requirement calculation;
• Current equalized assessed value;
• Current property tax rates; and
• Current equalized assessed value-to-lien ratio.
Task 4-Extension and Billing of the Special Tax
This task involves coordination with and assistance to the County, as needed, to facilitate the
extension and billing of the special tax. The special taxes will be established by ordinance
passed by the City on or before the last Tuesday in December. The following subtasks are
included:
4.1 Special Tax Roll:For the SSA,Consultant will prepare special tax roll listing each PIN and
the corresponding maximum special tax, special tax amount abated, and special tax
amount to be billed.
4.2 Transmittal to County: The special tax roll will be transmitted to the County in hard
copy and/or electronic form as specified by the County, along with a certified copy of
the abatement ordinances, to be provided to Consultant by the City, in hard copy and
electronic form as specified by the County.
4.3 Coordination with Assessor: As requested, Consultant will assist the applicable
Township Assessor determine the average public improvements allocable to properties
in the SSA.
Task 5 - Special Tax Collections
DTA will review the SSA Special Tax Distribution Reports provided by the County to monitor
and record the collection of special taxes as they are distributed to the SSA. DTA will request
and review the County's unpaid list to determine the payment status of each individual PIN.
This data will be recorded in special tax payment database and utilized to prepare an Annual
Delinquent Special Tax Report that shall be distributed to the City and County as needed. DTA
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will provide assistance to the County, as requested, to facilitate the collection of the special
taxes.
Task 6 -Delinquent Special Tax Follow-Up
DTA will assist in the collection of special taxes that remain delinquent after the County has
conducted its tax sale (or such other date as specified in the bond indenture). The following
subtasks are included:
6.1 Final Delinquent Special Tax Report: DTA will update the report of delinquent special
taxes prepared pursuant to Task 5 above.
6.2 Demand Letters: This task entails the preparation and mailing of demand letters to the
property owners with delinquent special taxes. DTA will prepare a draft demand letter
for review and approval by City staff. After the form of the demand letter is approved,
DTA will print the demand letters on City letterhead and mail to property owners.
6.3 Coordination with Delinquent Property Owners: DTA staff will be available to answer
questions from the delinquent property owners.
Task 7- Foreclosure Assistance
This task involves assistance with the foreclosure of the special taxes that remain delinquent
after the follow-up process. We assume that at this stage in the collection process the City will
be retaining legal counsel to pursue judicial foreclosure. Therefore,our services will consist of
activities to assist legal counsel and the City with the foreclosure action. The following subtasks
are included:
7.1 Foreclosure Report: Following the payment deadline specified in the demand letter,
DTA will prepare a report of the remaining delinquent special taxes that would be
subject to foreclosure.
7.2 Reserve Fund Analysis: This analysis will ascertain if the Reserve Fund is at its required
amount and if any draws will be needed to make the debt service payments on the
bonds.
7.3 Exhibit to Ordinance Ordering Judicial Foreclosure: DTA will prepare an exhibit
showing the delinquent special taxes, penalties, interest and collection costs to be
attached to the ordinance adopted by the City ordering the judicial foreclosure.
Task 8 -Prepayment Calculations
This task entails the calculation of prepayment amounts and coordination with the trustee and
associated record keeping in the event any special tax is prepaid. This task includes the
following subtask:
8.1 Special Tax Prepayments: Upon request, DTA will calculate the amount needed to
prepay the special tax pursuant to the prepayment formula as set forth and adopted in
the respective Rate and Method of Levying Special Taxes,as amended. The prepayment
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information provided will identify the amount due, the deadline for payment, and
direction regarding where payment is to be remitted.
Task 9 - Early Bond Redemption Analysis
This task involves analysis of the early redemption of bonds resulting from the prepayment of
special taxes or receipt of recapture funds. DTA will coordinate with the trustee to ensure the
proper application of such funds and review the resulting revised debt service schedule.
Task 10 -Taxpayer Inquiries
This task involves responding to telephone calls from prospective or current property owners
or other interested parties who have questions regarding SSA, the public improvements
financed, the amount of the special tax, etc. This task includes brief written responses to
property owners, as necessary. In order to efficiently and effectively handle these property
owner's requests,DTA has a toll-free number for property owners who have questions.
Task 11 -Arbitrage/Rebate Calculation
This task encompasses those activities associated with computing the rebate liability of the
bonds sold on behalf of SSA.
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FEE SCHEDULE
DTA's annual compensation for Tasks 1-6 and 8-10 of the Scope of Work listed under
Exhibit A is a fixed fee of $12,000 plus expenses. Task 7 services shall be billed on a time
and materials basis in accordance with the hour rate schedule in Table 1,with payment due
upon collection of the delinquent special taxes, including collection costs, through
foreclosure. DTA's compensation for Task 11 is $3,000 per bond issue for the initial
calculation, and $2,500 per bond issue per year for subsequent years. Additional fees will
be incurred for transferred proceeds analysis,commingled funds analysis,Final or Five-Year
Report, or computation period in excess of 12 months.
Table 1: DTA's Fee Schedule
Labor Category Labor Rate
President/Managing Director $300/Hour
Senior Vice President $27S/Hour
Vice President $250/Hour
Senior Manager $210/Hour
Manager $200/Hour
Senior Associate $190/Hour
Associate III $175/Hour
Associate II $165/Hour
Associate I $150/Hour
Research Associate II $140/Hour
Research Associate I $125/Hour
A General Terms and Conditions
The preceding annual professional fees shall be billed in four equal installments, with
invoices submitted by Consultant to Client on or about the first two weeks of each quarter.
Such invoices shall be paid by Client within 30 days of the date of each invoice. A 1.2%
charge may be imposed against accounts that are not paid within 30 days of the date of
each invoice.
At Client's request, services in addition to those identified in the Scope of Work statement
may be provided. Unless otherwise agreed to by Client and Consultant,any additional tasks
assigned by Client shall be charged at the hourly rates listed in Table 1.
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Such additional tasks may include but are not be limited to the following:
• Manual billing of special taxes;
• Administration of variable rate bonds;
• Attendance, other than via telephone, at meetings with property owners or City staff
to answer questions,review the levy, or resolve disputes regarding the calculation of
the special tax;
• Assistance with workshops, seminars, etc. concerning disclosure of the special tax;
and
• Assumption of dissemination agent responsibilities for Developer Continuing
Disclosure Reports, if any.
The preceding lump sum professional fees and hourly rates apply for a 12-month period
from execution of the Agreement and are subject to a cost-of-living and/or other
appropriate increase every 12 months thereafter. Consultant generally reviews its
professional fees and hourly rates annually and, if appropriate, adjusts them to reflect
increases in seniority,experience,cost-of-living,and other relevant factors.Consultant shall
notify Client in advance of any such increase.
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