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HomeMy WebLinkAboutRes 2001-56>aw»>y >fc»Bmmj^ RESOLUTION NO.2001-56 RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF$6,000,000 AGGREGATE PRINCIPAL AMOUNT OF GENERAL OBLIGATION BONDS, PROJECT OF 1997,SERIES 2001;PROVIDING FOR THE ANNUAL LEVY OF A TAX FOR THE PAYMENT OF THE BONDS;ACCEPTING A PROPOSAL FOR THE PURCHASE OF THE BONDS;APPROVING THE FORM AND AUTHORIZING THE EXECUTION OF AN AGREEMENT FOR THE SERVICES OFA BOND REGISTRAR, TRANSFER AGENT AND PAYING AGENT;AUTHORIZING THE PURCHASE OF BOND INSURANCE;APPROVING THE DISTRIBUTION OF AN OFFICIAL STATEMENT IN CONNECTION WITH THE ISSUANCE AND SALE OF THE BONDS HEREIN AUTHORIZED;RATIFYING THE ACTIONS OF TOWN OFFICERS AND AGENTS CONCERNING THE BONDS AND THE DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT PERTAINING TO THE BONDS;AND PROVIDING CERTAIN TERMS,COVENANTS AND PROVISIONS REGARDING THE BONDS. WHEREAS,pursuant toa special bond election heldinandforthe Town of FountainHills,Arizona (the "Town"),on November 4,1997,theissuanceofGeneralObligation Bonds has been approved;and WHEREAS,the Town now desires to issue and sell $6,000,000 of its General Obligation Bonds,Project of1997,Series2001(the "Bonds"),forthe purposes andaccordingto the terms as set forth in this resolution;and WHEREAS,allacts,conditions andthings required bythe Constitution andlaws oftheStateof Arizona to happen,exist andbe performed precedent toandinthe adoption of this resolution have happened,exist andhavebeen performed asso required in order to make this resolution a valid and binding instrument for the security of the Bonds authorized herein; NOW,THEREFORE,IT IS RESOLVED BY THE MAYOR AND COUNCIL OF THE TOWN OF FOUNTAIN HILLS,ARIZONA,AS FOLLOWS: Section 1.Authorization.Forthe purpose of providing fundstomakecertain ofthe acquisitions and public improvements authorized bythe qualified electors of the Town at thespecialbond election heldon November 4,1997,thereishereby authorized tobe issued and sold $6,000,000 aggregate principal amount ofthe Bonds. Section 2.Terms. A.Issuance of the Bonds.The Bonds hereby authorized tobe issued shall be designatedTownof Fountain Hills,Arizona General Obligation Bonds,Project of1997,Series 2001(the "Bonds").The Bonds shall be dated as of December 1,2001 and will bear interest fromthe most recent January 1or July 1to which interest has been paid,or inthe case of the interest due July 1,2002,from their original dated date,tothe maturity of each of the Bonds.The first interest payment datewillbeJuly1,2002,and interest shallbe payable semiannually SWR:gmh41327912/10/01 thereafter oneach succeeding July1and January 1duringthetermoftheBonds.TheBondsare expectedtobeinitiallyissuedinfullyregisteredbook-entry-onlyformindenominationsequalto the respective year's maturity amount.Ifthe book-entry-only system is discontinued,theBonds willbeissuedinthedenominationof$5,000eachorintegralmultiplesthereof.TheBondswill mature on July 1inthe years and amounts andwill bear interest atthe rates as follows: Maturity Date (July 1) Principal Amount Interest Rate Maturity Date (July 1) Principal Amount Interest Rate 2002 $225,000 6.000%2012 $325,000 4.500% 2003 225,000 6.000%2013 325,000 4.650% 2004 225,000 6.000%2014 350,000 4.750% 2005 250,000 6.000%2015 350,000 4.875% 2006 250,000 6.000%2016 375,000 5.000% 2007 250,000 6.000%2017 400,000 5.000% 2008 275,000 4.125%2018 425,000 5.000% 2009 275,000 4.250%2019 425,000 5.000% 2010 300,000 4.300%2020 450,000 5.000% 2011 300,000 4.400% B.Book-Entry-Only System Payments.So long asthe Bonds are administered under the Book-Entry-Only System described herein,interest payments and principal payments thatarepartof periodic principal and interest payments shallbepaidtoCede&Co.orits registered assignsin same-day fundsno later than2:30p.m.(Eastern Time)oneach interest or principalpaymentdate(orin accordance withthen existing arrangements betweenthe District and DTC).The Town andthe Registrar (as defined hereafter)and Paying Agent (as defined hereafter)on behalf of the Town,are authorized to enter intoan agreement (the "Letter of Representations")withDTCin connection withthe issuance oftheBondsand,whiletheLetter of Representations isin effect,the procedures established therein shallapplytothe Bonds.• C.Registration.If the book-entry-only system is discontinued,the Registrar's registration bookswillshowthe registered owners ofthe Bonds (the owner orownersofthe Bonds as shown onthe Registrar's registration books shall be referred toas "Owner"or "Owners").While the Bonds are subject tothe book-entry-only system,the Bonds shall be registeredinthenameofCede&Co.,orits registered assigns.TheBondswillbe administered bytheRegistrarina manner whichassuresagainstdouble issuance andprovidesasystemof transfer of ownership onthe books of the Registrar inthe manner setforthinthe Bonds. D.Payment.Ifthe Book-Entry-Only System is discontinued,interest onthe Bonds willbe payable oneach Interest Payment Date by check mailed tothe Owner thereof atthe Owner's address allas shown onthe registration books maintained bythe Registrar as of the close of business ofthe Registrar onthe fifteenth (15th)day of the month preceding an Interest PaymentDate(the "Record Date"). Ifthe Book-Entry-Only System is discontinued,principal of the Bonds willbe payable,whendue,onlyuponpresentationandsurrenderoftheBondatthedesignatedcorporate trustoffice ofthe Paying Agent (as defined hereafter).Upon written request of a registered -2- SWR:gmh 413279 12/10/01 ownerofatleast$1,000,000inprincipalamountofBondsnotlessthantwenty(20)dayspriorto an Interest Payment Date,all payments of interest and,if adequate provision for surrender is made,principalshallbepaidbywire transfer in immediately availablefundstoanaccountwithin the United States of America designated by such Owner. Notwithstanding any other provision of this resolution,payment of principal of and interest onany Bond thatis held bya securities depository or Bonds subject toa Book-Entry- Only System maybe paid bythePaying Agent bywire transfer in"samedayfunds". E.Other Terms.The Bonds have such additional terms and provisions asare setforthintheform of Bond attached hereto as Exhibit A,which isa part of this resolution. Section 3.Prior Redemption. A.Redemption.Bonds maturing onor before July 1,2010,arenot subject tocall for redemption priortomaturity.Bonds maturing onorafterJuly1,2011,aresubjecttocallfor redemption prior to maturity,atthe option of the Town,in whole orinpart,onJuly1,2010,or onany interest payment date thereafter without premium. B.Notice.Notice of redemption of any Bond willbe mailed byfirstclassmail, postageprepaid,totheregisteredownerthereofattheaddressshownonthebooksofthe Registrarnotmorethansixty(60)norlessthanthirty(30)days prior tothedatesetforredemp tion.Notice of redemption may be given to any securities depository by mail,facsimile,wire or othergenerally accepted meansof transmission ofsuchnotices.Failure toproperlygivenotice ofredemptionshallnotaffecttheredemptionofanyBondforwhichnoticewasproperlygiven. C.Effect of Callfor Redemption.Onthedate designated for redemption by noticegivenashereinprovided,theBondssocalledforredemptionshallbecomeandbedueand payableattheredemptionpriceprovidedforredemptionofsuchBondsonsuchdate,and,if moneysforpaymentoftheredemptionpriceareheldinseparateaccountsbythePayingAgent, interest onsuch Bonds or portions of Bonds so called for redemption shall cease toaccrue,such Bondsshallceasetobe entitled toany benefit or security hereunder andtheowners of such Bondsshallhavenorightsinrespect thereof except to receive payment ofthe redemption price thereof andsuch Bonds shallbe deemed paid andno longer outstanding. D.Redemption of Less Than All of a Bond.The Town may redeem an amount whichisincludedinaBondinthe denomination inexcessof,butdivisibleby,$5,000.Inthat event,theregistered owner shallsubmitthe Bond forpartial redemption andthePayingAgent shall make such partial payment andthe Registrar shall cause tobe issued anewBondina principalamountequaltotheunpaidamountremainingonsuchBondaftertheredemptiontobe authenticated and delivered tothe registered owner thereof. Section 4.Security.For the purpose ofpayingthe principal of,interestand premium(if any)onearly redemption andcostsof administration ofthe registration and payment of the Bonds thereshallbe levied onallthe taxable property inthe Town a continuing,direct, annual,advaloremtax sufficient topayallsuch principal,interest,premium and administration -3- SWR.gmh 413279 12/10/01 NiifctaX costs on the Bonds as the same becomes due,such taxes to be levied,assessed and collected at the same time and in the same manner as other taxes are levied,assessed and collected.The proceedsofthetaxesshallbekeptinaspecialfundandshallbeusedonlyforthepurposefor which collected. Section 5.Form of Bonds.Solongasthe Book-Entry-Only Systemisin effect,theBondsshallbein substantially theformof Exhibit A,attachedheretoand incorporated by reference herein,withsuch necessary and appropriate omissions,insertions and variations as are permitted or required herebyandare approved bythose officers executing theBondsand execution thereof bysuch officers shall constitute conclusive evidence of such approval.Ifthe Book-Entry-Only System is discontinued,the Bonds shall be reissued and transferred in forms of Bonds and Certificates tobe prepared atthattime. The Bonds mayhave notations,legends or endorsements required bylaw, securities exchange rule or usage.Each Bond shall be dated the date of its authentication and registration. Section 6.Use of Proceeds.The proceeds from thesale of the Bonds shallbe set aside and deposited bythe Accounting Supervisor ina separate account and used forthe purposeof acquiring an undivided interest incertain mountain preserve landandwillbecharged againsttheTown's20%debtlimit(Article9,Section8,Arizona Constitution).Themoneyfor shallbe applied andused solely forsuch purpose andshallbe charged against the ballot question submitted tothe qualified electors of the Town atthe special bond election of November 4,1997. Section 7.Execution of Bonds.The Bonds shall be executed for and on behalf of the Town bythe Mayor and attested bythe Clerk by their manual or facsimile signaturesandtheTownsealwillbe either photographically,mechanically reproduced or manually imprinted or affixed onthe Bonds.Ifthe signatures are affixed or imprinted by facsimile,the Mayor and Clerk shall execute a certificate adopting as their signatures the facsimile signatures appearing onthe Bonds. Ifan officer whose signature isona Bond no longer holdsthatofficeatthetime the Bond is authenticated and registered,the Bond shall nevertheless bevalid. A Bond shall not be valid or binding until authenticated bythe manual signature of an authorized officer ofthe Registrar.The signature shallbe conclusive evidence thatthe Bond has been authenticated and issued under this resolution. Section 8.Mutilated,Lost or Destroyed Bonds.In case any Bond becomes mutilated or destroyed or lost,the Town shall cause tobe executed and delivered anew Bond of likedateand tenor in exchange and substitution foranduponthe cancellation of such mutilated Bond orinlieu of andin substitution forsuch Bond destroyed orlost,uponthe registered owner's payingthereasonableexpensesandchargesoftheTowninconnection therewith and,inthecase ofthe Bond destroyed orlost,filingwiththe Town Clerk bythe registered owner evidence satisfactory totheTownthatsuch Bond was destroyed orlost,and furnishing theTownwitha sufficient indemnity bond pursuant to§47-8405,Arizona Revised Statutes. -4- SWR:gmh 41327912/10/01 c Section 9.Acceptance of Final Bid.The bid of A.G.Edwards &Sons,Inc. (the "Purchaser"),which isonfilewiththe Town Clerk,is hereby accepted asthe lowest and bestbidandtheBondsareherebyorderedsoldtosuch purchaser inaccordancewiththetermsof suchbidandthetermsand conditions ofthe Notice Inviting Proposals forthe Purchase of Bonds. The Accounting Supervisor is hereby authorized and directed to cause the Bonds tobe delivered toor upon the order of the purchaser upon receipt of payment therefor and satisfaction of the other conditions for delivery thereof in accordance with the terms of the sale. Section 10.Registrar and Paying Agent.The Town will maintain an office or agency where Bonds maybe presented for registration of transfer (the "Registrar")andanoffice or agency where Bonds may be presented for payment (the "Paying Agent").The Town may appointoneormore co-registrars oroneormore additional Paying Agents.The Registrar and Paying Agent may make reasonable rulesandset reasonable requirements for their respective functions with respect to the owners of the Bonds. Initially,National Bank of Arizona,Phoenix,Arizona,willactas,and is hereby designated as,the Registrar and Paying Agentwith respect tothe Bonds.Any entity intowhich the Registrar and Paying Agent is merged or consolidated shall continue asthe Registrar and PayingAgent hereunder without noticetotheownersof Bonds oranyfurtheractionbythe Town.The Town may change the Registrar or Paying Agent without notice toor consent of owners of the Bonds and the Town mayactinany such capacity. The contract for Registrar's services is hereby approved in substantially theform onfile with the Town Clerk to provide for payment of Registrar's services.The Town Clerk or Accounting Supervisor are hereby authorized and either such person is directed to execute the contract with the Registrar. Each Paying Agent willbe required to agree in writing that the Paying Agent will hold in trust forthe benefit of the owners of the Bonds all moneys held bythe Paying Agent for thepaymentofprincipalofandinterestandanypremiumontheBonds. The Registrar may appoint an authenticating agent acceptable tothe Town to authenticate Bonds.An authenticating agent may authenticate Bonds whenever the Registrar maydoso.EachreferenceinthisresolutiontoauthenticationbytheRegistrarincludes authentication byan authenticating agentactingon behalf andinthename of the Registrar and subjecttothe Registrar's direction. The Registrar shallkeepa register of the Bonds,the registered owners of the Bonds andof transfer of the Bonds.When Bonds are presented tothe Registrar ora co-registrar witharequesttoregistertransfer,theRegistrarwillregisterthetransferontheregistrationbooks ifitsrequirementsfor transfer aremetandwill authenticate anddeliveroneormoreBonds registeredinthenameofthetransfereeofthesameprincipalamount,maturityandrateof interest asthe surrendered Bonds.Bonds presented tothe Registrar for transfer afterthecloseof business onthe Record Date and before the close of business onthe next subsequent interest SWR:gmh 41327912/10/01 paymentdatewillberegisteredinthenameofthetransfereebuttheinterestpaymentwillbe made tothe registered owners shown onthe books of the Registrar as of the close of business on the Record Date. The Registrar shallauthenticateBondsfororiginalissueupto $6,000,000 in aggregateprincipalamountuponthewritten request ofthe Accounting Supervisor.The aggregateprincipalamountofBondsoutstandingatanytimemaynotexceedthatamountexcept for replacement Bondsastowhichthe requirements ofthe Registrar andtheTownaremet. Section 11.Official Statement.Thepreparation,completion,useand distributionofthe Preliminary Official Statement dated November 29,2001,asamendedbythat certainaddendumtheretodatedDecember5,2001(collectively,the "Preliminary Official Statement"),pertaining tothe original issuance of the Bonds inthe form now onfilewiththe Town Clerkis approved asa "deemed final"official statement (excepting permitted omissions), bytheTownasofitsdatefor purposes of Securities and Exchange Commission Rule 15c2-12 (the "Disclosure Rule").Either the Mayor orthe Accounting Supervisor is hereby authorized to certify or represent that theOfficial Statement is"final"for purposes of the Disclosure Rule. SuchapprovalofthePreliminaryOfficial Statement byeithertheMayororAccounting Supervisor shall constitute the approval and designation bythe Town of the Preliminary Official Statement asa deemed final Official Statement forall purposes of the Disclosure Rule.Either the Mayor or Accounting Supervisor is authorized onthe Town's behalf to complete afinal official statement tobe dated onor about thedate hereof,andin substantially theformofthe Preliminary Official Statement (the "FinalOfficial Statement").(The Preliminary Official Statement andthe Final Official Statement are collectively referred to herein asthe "Official Statement".)The Final Official Statement shall contain such modifications,changes and supplements as either the Mayor or Accounting Supervisor shall approve or authorize as necessary to make true and accurate the information contained therein.Either the Mayor or Accounting Supervisor is hereby authorized to execute and deliver tothe Underwriters the Final Official Statement. Either the Mayor or Accounting Supervisor is further authorized touseand distribute,or authorize theuseand distribution of,the Final Official Statement and supplements thereto concerning the original issuance ofthe Bonds asmayinthe Mayor's or Accounting Supervisor's judgment be necessary or appropriate. The Mayor,Town Clerk or Accounting Supervisor isalso authorized tosignand deliver,onthe Town's behalf andintheir official capacities,such certificates concerning the accuracyofthe Final Official Statement andany amendment thereto asmay,in their judgment, be necessary or appropriate. Section 12.Continuing Disclosure Undertaking.In order to comply withthe provisions ofthe Disclosure Rule,the Accounting Supervisor is hereby authorized and directed toprepare,execute and deliver on behalf ofthe Town a written undertaking or agreement forthe benefit of the owners of the Bonds.The written undertaking or agreement shall contain such termsand provisions asare necessary to comply withthe Disclosure Rule including,butnot limited to(i)an agreement to provide to each nationally recognized municipal securities -6- SWR:gmh 41327912/10/01 information repository andtothe Arizona state information depository,if oneshallbeso designatedbytheStateofArizona,thefinancialinformationoroperatingdatapresentedinthe finalofficialstatementasdeterminedbymutualagreementbetweentheAccountingSupervisor andtheUnderwriterandtheTown'sauditedfinancialstatementsand(ii)anagreementtoprovide materialeventsdisclosuretonationallyrecognizedmunicipalsecuritiesinformationrepositories ortoanystate information depository hereinafter designatedandtheMunicipalSecurities Rulemaking Board. Section 13.Rebate Fund;Rebate Payments.TheMayorandtheCouncil hereby authorize the Accounting Supervisor oranyagent thereof tocreatea separate fundtobe knownasthe Rebate Fund.Intosuchfundshallbe deposited anyandall moneys deemed necessary to remain in compliance with the provisions of Section 148 of the Internal Revenue Codeof1986,asamended(the "Code"),oranyregulations promulgated thereunder.Moneysin suchfundshallbe segregated or(if authorized inwritingbyanopinionofbondcounsel) commingled with other moneys of the Town.The Accounting Supervisor is ordered and directed toemployorengageoneormorearbitragerebate consultants to calculate annuallyany necessary rebate amount tobe paid totheUnitedStatesofAmerica.The Accounting Supervisor is authorized and directed topayany amounts necessary tothe United States,as arbitrage rebate(s). Section 14.Bond Insurance or Credit Enhancement.The Accounting Supervisor ishereby authorized to expend orcausetobe expended Bond proceedstopurchasea municipal bond insurance policy or other credit enhancements forthe Bonds if deemed tobein the Town's best interest. Section 15.Resolution a Contract.This resolution shall constitute a contract between the Town andthe registered owners ofthe Bonds and shall notbe repealed or amended inany manner which would impair,impede orlessentherights of the registered owners of the Bonds then outstanding. Section 16.Severability.Ifany section,paragraph,subdivision,sentence, clauseorphraseofthis resolution isforanyreasonheldtobe illegal,invalid or unenforceable, such decision willnot affect the validity of the remaining portions of this resolution.The Mayor and Council hereby declare thatthe Town would have adopted this resolution andeachandevery other section,paragraph,subdivision,sentence,clause or phrase hereof and authorized the issuance of the Bonds pursuant hereto irrespective of thefact that any one or more sections, paragraphs,subdivisions,sentences,clausesorphrasesofthis resolution maybeheldillegal, invalid or unenforceable. Section 17.Ratification of Actions.All actions of the officers andagentsof the Town which conform tothe purposes and intent of this resolution and which further the issuance and sale of the Bonds as contemplated bythis resolution whether heretofore or hereafter takenshallbeandare hereby ratified,confirmed and approved.Any change madeinthe Notice Inviting Proposals forthe Purchase of Bonds whichdonot conform tothe prior order ofthis MayorandCouncilareherebyratified.TheproperofficersandagentsoftheTownarehereby authorized and directed todoallsuchactsand things andto execute and deliver allsuch -7- SWR:gmh 413279 12/10/01 documents on behalf of the Town as may be necessary to carry outthe terms and intent of this resolution. Section 18.Qualified Tax-Exempt Obligations.TheBondsarenot"qualified tax-exempt obligations"for purposes ofSection265(b)(3)oftheCode. Section 19.Tax Covenants.In consideration of the purchase and acceptance of the Bonds bythe owners thereof and,as authorized by Arizona Revised Statutes,Title 35, Chapter 3,Article7,andin consideration ofretainingthe exclusion ofinterestincomeonthe Bonds from gross income for federal income tax purposes,the Town covenants with the owners from time to time of the Bonds to neither take nor failto take any action which action or failure toactis within its power and authority and would result in interest onthe Bonds become subject to federal income taxes. The Town agrees that itwill comply with such requirements asinthe opinion of Gust Rosenfeld p.l.c.("bondcounsel")are necessary to prevent interest on the Bonds becoming subjectto inclusion ingross income forfederalincometax purposes.Such requirements may include butarenot limited to making further specific covenants;making truthful certifications and representations andgiving necessary assurances;complying withall representations, covenants and assurances contained in certificates or agreements tobe prepared by bond counsel; topaytotheUnitedStatesofAmericaanyrequiredamounts representing rebatesofarbitrage profitsrelatingtotheBonds;filingforms,statementsand supporting documentsasmaybe requiredunderthefederaltaxlaws;limitingthetermofandyieldoninvestmentsmadewith s-moneysrelatingtotheBonds;and limiting theuseoftheproceedsoftheBondsandproperty \^financedthereby. SWR:gmh 413279 12/10/01 PASSED AND ADOPTED bytheMayorandCounciloftheTownofFountain Hills,Arizona,on December 10,2001. ATTEST: Town Clerk APPROVED AS TO FORM: Bond Counsel Exhibit A:Bond Form CERTIFICATION I,Cassie Hansen,theduly appointed and acting Clerk ofthe Town of Fountain Hills,Arizona,doherebycertifythattheaboveandforegoingResolutionNo.2001-56wasduly passedbytheTownCounciloftheTownofFountainHills,Arizona,ataregularmeetingheldon December 10,2001,and the vote was ls>aye's and I nay's and that the Mayor and C? Council Members were present thereat. DATED:December 10,2001. -9- SWR:«mli 413279 12/10/01 Town Clerk Xatgap^ EXHIBIT A (Form of BondtobeusedWhile Book-Entry-Only System isinEffect) Number:Denomination: Unlessthis Bond is presented byan authorized representative of The Depository Trust Company,aNew York corporation ("DTC"),to the Registrar (orany successor registrar)for registration of transfer,exchange,or payment,and any Bond issuedis registered in the name ofCede&Co.orin such other name asis requested byan authorized representative of DTC,(and any payment is made toCede&Co.orto such other entity asis requested byan authorized representative of DTC),any transfer,pledge,or other use hereof for value or otherwise byortoany person is wrongful inasmuch as the registered owner hereof,Cede &Co.,hasan interest herein. TOWN OF FOUNTAIN HILLS,ARIZONA GENERAL OBLIGATION BOND PROJECT OF 1997,SERIES 2001 Interest Maturity Original Rate Date Dated Date CUSEP _%July 1,20_December 1,2001 RegisteredOwner:Cede&Co. PrincipalAmount:AND NO/100 DOLLARS($) TOWN OF FOUNTAIN HILLS,ARIZONA (the "Town"),for value received,hereby promisestopaytotheregisteredowneridentifiedabove,orregisteredassignsasprovidedherein,onthe maturitydatesetforthabove,theprincipalamountsetforthabove,andtopayinterestontheunpaid principalamountattheinterestrateshownabove. INSERT CALL FEATURE HERE,IF APPLICABLE Interest is payable on January 1andJuly1 of each year commencing July1,2002,and will accrue fromthe most recent date towhich interest has been paid,or,ifno interest hasbeenpaid,from theoriginaldateddatesetforthabove.Interestwillbe computed onthebasisofayearcomprisedof360 daysconsistingoftwelve(12)monthsofthirty(30)dayseach. Principal of andinterestonthisbondarepayableinlawfulmoneyoftheUnitedStatesof America.Interestpaymentsandprincipalpaymentsthatarepartofperiodicprincipalandinterest paymentsshallbereceivedbyCede&Co.,asnomineeofDTC,oritsregisteredassignsinsame-day fundsnolaterthan2:30p.m.(Eastern Time)oneachinterestorprincipalpaymentdatein accordance withexistingarrangementsbetweentheCityandDTC. Itis hereby certified andrecitedthatall conditions,actsandthings required bythe Constitution andlaws of the State of Arizona to exist,to occur andtobe performed precedent toandin the issuance of this bond exist,have occurred andhave been performed andthatthe series of bonds of whichthisisone,together withall other indebtedness of the Town,iswithineverydebtand other limit SWR:gmh 41329212/03/01 A-l prescribedbytheConstitutionandlawsoftheStateofArizona,andthatdue provision hasbeenmadefor C the levy and collection ofa direct,annual,ad valorem tax upon all of the taxable property in the Town for the payment of this bond and of the interest hereon as each becomes due. Thisbondisoneofanissueofgeneralobligationbondsintheaggregateprincipal amountof$6,000,000ofliketenorexceptastoamount,maturitydate,redemptionprovisions,interest rateandnumber,issuedbytheTowntoprovidefundstomakethosecertainacquisitionsandpublic improvementsapprovedbyamajorityvoteofqualifiedelectorsvotingatanelectiondulycalledandheldin andfortheTown,pursuanttoaresolutionoftheMayorandCounciloftheTowndulyadoptedpriortothe issuance hereof (the "Resolution")and pursuant tothe Constitution andlaws of theState of Arizona relative totheissuanceandsaleofgeneralobligationbonds,andall amendments thereto,andallotherlawsofthe State of Arizona thereunto enabling. Forthe punctual payment of thisbondandthe interest hereonandforthelevyand collection ofad valorem taxes onall taxable property within the Town sufficient forthat purpose,the fullfaithand credit of the Town are hereby irrevocably pledged. The registrar or paying agent maybe changed bythe Town without notice. Solongasthe book-entry-only system isin effect,thisbondis non-transferable.Ifthe book-entry-only system is discontinued,this bond is transferable bythe registered owner in person orby attorney duly authorized in writing atthe designated office of the registrar,which onthe original issue dateisthe corporate trust office of National Bank of Arizona upon surrender and cancellation ofthis bond.Bonds ofthis issue willbe issued onlyinfully registered form inthe denomination of $5,000 of principalorintegral multiples thereof. The Town,the registrar andthe paying agent may treat the registered owner of thisbond asthe absolute owner forthe purpose of receiving principal and interest andforall other purposes and none of them shallbe affected byany notice tothe contrary. The Town has caused this bond tobe executed bythe Mayor,attested bythe Clerk and countersigned bythe Accounting Supervisor,which signatures maybe facsimile signatures andtheTown sealhasbeen impressed onthisbond.Thisbondisnotvalidor binding uponthe Town without the manuallyaffixedsignatureofan authorized representative oftheregistrar.Thisbondis prohibited from beingissuedincouponor bearer form without the consent of the Town andthe occurrence of certain other conditions. TOWN OF FOUNTAIN HILLS,ARIZONA Mayor ATTEST: Clerk SWR-.gmh 41329212/03/01 A-2 DATE OF AUTHENTICATION AND REGISTRATION:December 20,2001 AUTHENTICATION CERTIFICATE ThisbondisoneoftheTownofFountainHills,Arizona,GeneralObligationBonds, Project of 1997,Series 2001,described inthe resolution mentioned herein. NATIONAL BANK OF ARIZONA,as Registrar Authorized Representative (INSERT INSURANCE STATEMENT HERE,IF APPLICABLE) FORM OF ASSIGNMENT The following abbreviations,when used inthe inscription ontheface of thisbond,shall be construed asthoughtheywerewrittenoutinfull according to applicable lawsor regulations: TEN COM -as tenants in common UNIF GIFT/TRANS MIN ACT-Custodian TENENT-astenantsbytheentireties (Cust)(Minor) JTTEN-asjointtenantswithrightofsurvivorship underUniform Gifts/Transfers toMinorsAct(State) and not as tenants in common Additional abbreviations may also be used though notinlist above ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sells,assigns and transfers unto (Name and Address of Transferee) thewithinbondandallrights thereunder,and hereby irrevocably constitutes and appoints _,attorney to transfer the within bond onthe bookskeptfor registration thereof,withfullpowerof substitution inthepremises. Dated Note:The signature(s)onthis assignment must correspond with the name(s)as written onthe within registered bond inevery particular without alteration or enlargement orany change whatsoever. Signature Guaranteed: Firm or Bank Authorized Signature Signatureguaranteeshouldbemadebya guarantor institution participatinginthe Securities TransferAgentsMedallionProgram orinsuch other program acceptable tothe Registrar ALL FEES AND TRANSFER COSTS SHALL BE PAID BY THE TRANSFEROR SWR:gmh 413292 12/03/01 A-3