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RES 1692 08/19/2024 Providing for Defeasancerf Xi's "City of Choice" Resolution Number: 1692 A RESOLUTION BY THE CITY COUNCIL OF THE CITY OF CIBOLO, TEXAS PROVIDING FOR THE DEFEASANCE AND CALLING FOR REDEMPTION CERTAIN CURRENTLY OUTSTANDING OBLIGATIONS; DIRECTING THE GOVERNING BODY, OR A DESIGNEE THEREOF, TO EFFECTUATE THE REDEMPTION OF THESE OBLIGATIONS; AUTHORIZING THE EXECUTION OF AN ESCROW AGREEMENT; DELEGATING TO CERTAIN CITY OFFICIALS AND STAFF THE AUTHORITY TO EFFECTUATE MATTERS HEREIN RESOLVED; AND OTHER MATTERS IN CONNECTION THEREWITH WHEREAS, the City Council (the Governing Body) of the City of Cibolo, Texas (the Issuer or the City) previously adopted various ordinances (collectively, the Original Ordinances) authorizing the issuance of the City's currently outstanding ad valorem tax -backed obligations (collectively, the Obligations), certain of which are subject to redemption at the City's option; and WHEREAS, the Original Ordinance provides the notice requirements to effectuate the redemption and defeasance of the Obligations that are subject to redemption prior to their applicable Stated Maturity; and WHEREAS, it is in the best interest of the City and its residents to defease certain of the Obligations (the Defeased Obligations), extinguishing the City's payment obligations with respect thereto at the time of defeasance, and calling the Defeased Obligations for redemption, all as herein provided; now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CIBOLO, TEXAS THAT: SECTION 1. The Governing Body hereby authorizes an Authorized Official (defined herein) to use City funds realized from prior interest and sinking fund tax collections or any other lawfully available source (the Defeasance Proceeds), in an amount necessary and sufficient to defease, to redemption, the Defeased Obligations, which shall be determined by an Authorized Official and set forth in Exhibit A hereto. An Authorized Official shall accomplish the defeasance of the Defeased Obligations by establishing and funding with Defeasance Proceeds prior to the end of the City's 2024-2025 fiscal year the hereinafter -defined Escrow Fund pursuant to the provisions of Section 3 hereof. An Authorized Official shall identify the maximum principal amount of Defeased Obligations that can be defeased after taking into consideration City funds from the -1- sources identified above, interest earnings on Escrow Fund deposits, and final costs related to establishment of any Escrow Fund, with the goal of maximizing the principal amount of the Defeased Obligations. City officials currently estimate that the Defeased Obligations will be between $300,000 and $500,000, and such amount will be determined to the City after February 2025, when current taxes become delinquent and the tax collections available for defeasance are ascertained. SECTION 2. The City hereby calls for redemption the Defeased Obligations. This election to redeem is irrevocable upon adoption of this Resolution by the Governing Body. The form of the Notice of Redemption for the Defeased Obligations is attached as Exhibit B hereto and incorporated by reference for all purposes. SECTION 3. The Escrow and Trust Agreement, dated as of August 19, 2024 (the Agreement), by and between the City and the Escrow Agent and relating to the Defeased Obligations and attached hereto as Exhibit C and incorporated herein by reference as a part of this Resolution for all purposes, is hereby approved as to form and content, and such Agreement, together with such changes or revisions as may be necessary to accomplish the defeasance of the Defeased Obligations or benefit the City, is hereby authorized to be executed by an Authorized Official, for and on behalf of the City and as the act and deed of this Governing Body; and such Agreement as executed by said Authorized Official shall be deemed approved by the Governing Body and constitute the Agreement herein approved. Furthermore, each Authorized Official, the City's Financial Advisor (Specialized Public Finance Inc.), and the City's Bond Counsel (McCall, Parkhurst & Horton L.L.P.), in cooperation with the Escrow Agent, are hereby authorized and directed to make the necessary arrangements for the deposit of cash and/or the purchase of any securities referenced in the Agreement and the delivery thereof to the Escrow Agent upon delivery to the Escrow Agent of the Defeasance Proceeds for deposit to the credit of the "CITY OF CIBOLO, TEXAS DEFEASANCE ESCROW FUND" (the Escrow Fund), as may be modified in name to reference the appropriate Defeasance Obligations, and may include the execution of the subscription forms, if any, for the purchase and issuance of the "United States Treasury Securities - State and Local Government Series" for deposit to the Escrow Fund; all as contemplated and provided by the provisions of Chapter 1207, as amended, Texas Government Code, this Resolution, and the Agreement. SECTION 4. The Mayor and the City Secretary of the Governing Body are authorized and instructed to give notice of redemption described herein to the paying agent/registrar for the Defeased Obligations for further delivery thereby to the holders of such Defeased Obligations, as provided in the Original Ordinance. SECTION 5. The Governing Body hereby appoints a qualified verification agent (the Verification Agent), as necessary, to verify the sufficiency of the deposit to the Escrow Fund to accomplish the defeasance of the Defeased Obligations, to the extent such appointment is necessary or desired. SECTION 6. Each Authorized Official is authorized to evidence adoption of this Resolution and to do any and all things necessary or convenient to effect the redemption of the Defeased Obligations herein described and otherwise give effect to the intent and purpose hereof. -2- SECTION 7. The Governing Body hereby directs that Defeasance Proceeds shall include amounts sufficient to pay professional fees and expenses of the City's Bond Counsel, the City's Financial Advisor, the Escrow Agent, the Verification Agent, the paying agent/registrar for the Defeased Obligations, respectively, and any other party whose services have been determined by the City to be necessary to accomplish the purpose and intent of this Resolution. Use of Defeasance Proceeds to pay these expenses is hereby approved. SECTION 8. The recitals contained in the preamble hereof are hereby found to be true, and such recitals are hereby made a part of this Resolution for all purposes and are adopted as a part of the judgment and findings of the Governing Body. SECTION 9. All ordinances and resolutions, or parts thereof, which are in conflict or inconsistent with any provision of this Resolution are hereby repealed to the extent of such conflict, and the provisions of this Resolution shall be and remain controlling as to the matters resolved herein. SECTION 10. This Resolution shall be construed and enforced in accordance with the laws of the State of Texas and the United States of America. SECTION 11. If any provision of this Resolution or the application thereof to any person or circumstance shall be held to be invalid, the remainder of this Resolution and the application of such provision to other persons and circumstances shall nevertheless be valid, and the Governing Body hereby declares that this Resolution would have been enacted without such invalid provision. SECTION 12. It is officially found, determined, and declared that the meeting at which this Resolution is adopted was open to the public and public notice of the time, place, and subject matter of the public business to be considered at such meeting, including this Resolution, was given, all as required by Chapter 551, as amended; Texas Government Code. SECTION 13. Though such parties may be identified; and the entry into a particular form of contract may be authorized herein, the Governing Body hereby delegates to the Mayor, the Mayor Pro Tem, the City Manager, the Director of Finance (or any individual serving in an interim or on an acting basis in this capacity), and/or the City Secretary (each of the foregoing, an Authorized Off cial) the authority to independently select the counterparty to any agreement with the Escrow Agent, Verification Agent or any other contract that is determined by an Authorized Official, the City's Financial Advisor, or Bond Counsel to be necessary or incidental to carry out the provisions of this Resolution, as long as each of such contracts has a value of less than the amount referenced in Section 2252.908 of the Texas Government Code, as amended (collectively, the Ancillary Bond Contracts); and, as necessary, to execute the Ancillary Bond Contracts on behalf and as the act and deed of the City. The Governing Body has not participated in the selection of any of the business entities which are counterparties to the Ancillary Bond Contracts. SECTION 14. Capitalized terms used but not otherwise defined herein shall have the same meanings as set forth in the Original Ordinance. SECTION 15. This Resolution shall be in force and effect from and after its final passage, and it is so resolved. -3- PASSED AND ADOPTED, this the 19th day of August, 2024. ATTEST: Peggy Cimics, TRMC City Secretary CITY OF CIBOLO, TEXAS Mayor � L [The remainder ofthis page intentionally left blank] � no DEFEASED OBLIGATIONS A-1