HomeMy WebLinkAboutRes 2025-10-1846 Preliminary Limited Offering Memorandum for Special Assessment Revenue Bonds Series 2025 (Crystal Park PID 2 Area No. 1)THIS PAGE IS LEFT BLANK INTENTIONALLY.
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PRELIMINARY LIMITED OFFERING MEMORANDUM
7,456,000*
CITY OF ANNA, TEXAS,
a municipal corporation of the State of Texas located in Collin County)
SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2
IMPROVEMENT AREA #1 PROJECT)
INTRODUCTION
The purpose of this Limited Offering Memorandum, including the cover page, inside cover, and appendices
hereto, is to provide certain information in connection with the issuance and sale by the City of Anna, Texas (the
City”), of its $7,456,000* aggregate principal amount of Special Assessment Revenue Bonds, Series 2025 (Crystal
Park Public Improvement District No. 2 Improvement Area #1 Project) (the “Bonds”).
INITIAL PURCHASERS ARE ADVISED THAT THE BONDS BEING OFFERED PURSUANT TO THIS
LIMITED OFFERING MEMORANDUM ARE BEING OFFERED INITIALLY TO AND ARE BEING SOLD
ONLY TO “ACCREDITED INVESTORS” AS DEFINED IN RULE 501 OF REGULATION D PROMULGATED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT OF 1933”) AND
QUALIFIED INSTITUTIONAL BUYERS” AS DEFINED IN RULE 144A PROMULGATED UNDER THE
SECURITIES ACT OF 1933. THE LIMITATION OF THE INITIAL OFFERING TO QUALIFIED
INSTITUTIONAL BUYERS AND ACCREDITED INVESTORS DOES NOT DENOTE RESTRICTIONS ON
TRANSFERS IN ANY SECONDARY MARKET FOR THE BONDS. PROSPECTIVE INVESTORS SHOULD BE
AWARE OF CERTAIN RISK FACTORS, ANY OF WHICH, IF MATERIALIZED TO A SUFFICIENT DEGREE,
COULD DELAY OR PREVENT PAYMENT OF PRINCIPAL OF, PREMIUM, IF ANY, AND/OR INTEREST ON
THE BONDS. THE BONDS ARE NOT A SUITABLE INVESTMENT FOR ALL INVESTORS. SEE
LIMITATIONS APPLICABLE TO INITIAL PURCHASERS,” “BONDHOLDERS’ RISKS,” AND
SUITABILITY FOR INVESTMENT.”
The Bonds are being issued by the City pursuant to the Public Improvement District Assessment Act,
Subchapter A of Chapter 372, Texas Local Government Code, as amended (the “PID Act”), an ordinance expected to
be adopted by the City Council of the City (the “City Council”) on November 17, 2025 authorizing the issuance of
the Bonds (the “Bond Ordinance”), and an Indenture of Trust (the “Indenture”), between the City and Regions Bank,
an Alabama state banking corporation with offices in Houston, Texas, as trustee (the “Trustee”). All capitalized terms
used in this Limited Offering Memorandum that are not otherwise defined herein shall have the meanings set forth
in the Indenture. See “APPENDIX B – Form of Indenture.”
The Bonds will be secured by a first lien on, security interest in, and pledge of the Trust Estate, consisting
primarily of revenue from Improvement Area #1 Assessments levied against Improvement Area #1 Assessed Property
located within Improvement Area #1 of the District pursuant to the Assessment Ordinance, all to the extent and upon
the conditions described in the Indenture. Reference is made to the Indenture for a full statement of the authority for,
and the terms and provisions of, the Bonds.
Set forth herein are brief descriptions of the City, the District, the Developer, the Administrator, the
Assessment Ordinance, the Bond Ordinance, the Service and Assessment Plan, the Development Agreement (defined
herein), the CFA Agreement (defined herein), and the Appraisal (defined herein), together with summaries of terms
of the Bonds and the Indenture and certain provisions of the PID Act. All references herein to such documents and
the PID Act are qualified in their entirety by reference to such documents or such PID Act and all references to the
Bonds are qualified by reference to the definitive forms thereof and the information with respect thereto contained in
the Indenture. Copies of these documents may be obtained during the period of the offering of the Bonds from the
Underwriter, FMSbonds, Inc., 5 Cowboys Way, Suite 300-25, Frisco, Texas, 75034, Phone: (214) 302-2246. The
Form of Indenture appears in APPENDIX B and the Form of Service and Assessment Plan appears in APPENDIX C.
The information provided under this caption “INTRODUCTION” is intended to provide a brief overview of the
information provided in the other captions herein and is not intended, and should not be considered, fully
representative or complete as to the subjects discussed hereunder.
Preliminary, subject to change.
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PLAN OF FINANCE
Overview
Following receipt of a petition from Bloomfield Homes, L.P., a Texas limited partnership (the “Developer”),
in accordance with the PID Act, the City created the District on February 25, 2025. The District is composed of
approximately 274.396 acres within the corporate boundaries of the City. It is located just west of US 75 and south
of White Street, approximately 30 miles northeast of Frisco, 12 miles north of McKinney and 22 miles south of
Sherman. Maps of the District and the surrounding region are included on pages iii – v.
Development Plan
The District is a master-planned community expected to be constructed in five phases (each, an
Improvement Area”) and to include approximately 946 single-family detached residential lots, expected to consist of
approximately 418 50’ lots, 282 60’ lots, 151 70’ lots and 95 80’ lots, and the amenities described in “THE
DEVELOPMENT – Amenities and Private Improvements” (collectively, the “Development”). See the map of the
District on page v and “THE DEVELOPMENT.”
The land within the District is currently owned by the Developer. Improvement Area #1 is the first area of
the District to be developed by the Developer. Improvement Area #1 consists of approximately 47.859 acres and is
expected to include 171 single-family detached residential lots, consisting of 123 50’ lots and 48 60’ lots. The
Developer began development of Improvement Area #1 in Q2 2025 and expects such development to be completed
in Q3 2026. The Developer intends to construct homes on all lots in Improvement Area #1. See “THE
IMPROVEMENT AREA #1 AUTHORIZED IMPROVEMENTS,” “THE DEVELOPMENT” and “APPENDIX C –
Form of Service and Assessment Plan.”
The Developer is constructing certain public improvements that benefit only Improvement Area #1 of the
district (the “Improvement Area #1 Improvements”) and certain public improvements that benefit the entire District
the “Major Improvements”). A portion of the proceeds of the Bonds will be used to reimburse the Developer for a
portion of the Actual Costs of the Improvement Area #1 Improvements and Improvement Area #1’s allocable share
of the Major Improvements (collectively, the “Improvement Area #1 Projects”). The total cost of the Improvement
Area #1 Projects is expected to be approximately $9,761,192. The City will reimburse the Developer for a portion of
such costs in the approximate amount of $5,722,000* from proceeds of the Bonds. The balance of such costs, in the
approximate amount of $4,039,192*, will be funded by the Developer from proceeds of the Revolving Credit
Agreement (defined herein) and will not be reimbursed by the City. As of September 30, 2025, the Developer has
spent approximately $1,089,425 on construction of the Improvement Area #1 Improvements and $824,462 on
construction of the Major Improvements. See “SOURCES AND USES OF FUNDS,” “THE IMPROVEMENT AREA
1 AUTHORIZED IMPROVEMENTS,” “THE DEVELOPER – History and Financing of the District,” and
APPENDIX C – Form of Service and Assessment Plan.”
The City and the Developer expect to enter into the Crystal Park Public Improvement District No. 2
Improvement Area #1 Construction, Funding, and Acquisition Agreement (the “CFA Agreement”), which provides,
in part, for the deposit of proceeds from the issuance and sale of the Bonds and the payment of costs of the
Improvement Area #1 Projects, including payment to the Developer for funds expended by the Developer on the
Improvement Area #1 Projects. See “APPENDIX F – Form of CFA Agreement.”
The Developer expects to request the City to issue in the future one or more series of bonds (collectively, the
Future Improvement Area Bonds”) to finance the costs of the public improvements benefitting future Improvement
Areas (each such area, a “Future Improvement Area”) within the District outside of Improvement Area #1 (such land
outside of Improvement Area #1 is identified as the “Remainder Area” in the map on page v) and the portion of the
Major Improvements allocable to the applicable Future Improvement Area. The estimated costs of the public
improvements benefiting each such Future Improvement Area will be determined as development progresses, and the
Service and Assessment Plan will be updated accordingly to include a description and the costs of such public
Preliminary; subject to change.
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improvements. Such Future Improvement Area Bonds will be secured by separate assessments levied pursuant to the
PID Act on assessable property within the Future Improvement Area benefitted thereby. The Developer anticipates
that Future Improvement Area Bonds will be issued over a six-year period. See “THE DEVELOPMENT – Future
Improvement Area Bonds.”
The Bonds
Proceeds of the Bonds will be used to provide funds for (i) paying a portion of the Improvement Area #1
Project Costs, (ii) paying a portion of the interest on the Bonds during and after the period of acquisition and
construction of the Improvement Area #1 Projects, (iii) funding a reserve fund for the payment of principal of and
interest on the Bonds, (iv) paying a portion of the costs incidental to the organization of the District, and (v) paying
the costs of issuance of the Bonds. See “SOURCES AND USES OF FUNDS,” “THE IMPROVEMENT AREA #1
AUTHORIZED IMPROVEMENTS,” and “APPENDIX B – Form of Indenture.”
Payment of the Bonds is secured by a first lien on, security interest in, and pledge of the Trust Estate,
consisting primarily of Pledged Revenues derived from Improvement Area #1 Assessments to be levied against the
Improvement Area #1 Assessed Property, all to the extent and upon the conditions described herein and in the
Indenture. See “SECURITY FOR THE BONDS,” “ASSESSMENT PROCEDURES,” and “APPENDIX B – Form
of Indenture.”
The Bonds, any Refunding Bonds, and any Future Improvement Area Bonds shall never constitute an
indebtedness or general obligation of the City, the State of Texas (the “State”), or any other political subdivision
of the State within the meaning of any constitutional provision or statutory limitation whatsoever, but the
Bonds are limited and special obligations of the City payable solely from the Trust Estate as provided in the
Indenture. Neither the faith and credit nor the taxing power of the City, the State, or any other political
subdivision of the State is pledged to the payment of the Bonds. Neither any Refunding Bonds nor any Future
Improvement Area Bonds to be issued by the City are offered pursuant to this Limited Offering Memorandum.
LIMITATIONS APPLICABLE TO INITIAL PURCHASERS
Each initial purchaser is advised that the Bonds being offered pursuant to this Limited Offering Memorandum
are being offered and sold only to “qualified institutional buyers” as defined in Rule 144A promulgated under the
Securities Act of 1933, and “accredited investors” as defined in Rule 501 of Regulation D promulgated under the
Securities Act of 1933. The limitation of the initial offering to qualified institutional buyers and accredited investors
does not denote restrictions on transfers in any secondary market for the Bonds. Each initial purchaser of the Bonds
each, an “Investor”) will be deemed to have acknowledged, represented, and warranted to the City as follows:
1. The Investor has authority and is duly authorized to purchase the Bonds and to execute any
instruments and documents required to be executed by the Investor in connection with the purchase of the Bonds.
2. The Investor is an “accredited investor” under Rule 501 of Regulation D of the Securities Act of
1933 or a “qualified institutional buyer” under Rule 144A of the Securities Act of 1933, and therefore has sufficient
knowledge and experience in financial and business matters, including purchase and ownership of municipal and other
tax-exempt obligations, to be able to evaluate the risks and merits of the investment represented by the Bonds.
3. The Bonds are being acquired by the Investor for investment and not with a view to, or for resale in
connection with, any distribution of the Bonds, and the Investor intends to hold the Bonds solely for its own account
for investment purposes for an indefinite period of time and does not intend at this time to dispose of all or any part
of the Bonds. However, the Investor may sell the Bonds at any time the Investor deems appropriate. The Investor
understands that it may need to bear the risks of this investment for an indefinite time, since any sale prior to maturity
may not be possible.
4. The Investor understands that the Bonds are not registered under the Securities Act of 1933 and that
such registration is not legally required as of the date hereof; and further understands that the Bonds (a) are not being
registered or otherwise qualified for sale under the “Blue Sky” laws and regulations of any state, (b) will not be listed
in any stock or other securities exchange, and (c) will not carry a rating from any rating service.
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5. The Investor acknowledges that it has either been supplied with or been given access to information,
including financial statements and other financial information, and the Investor has had the opportunity to ask
questions and receive answers from knowledgeable individuals concerning the City, the Improvement Area #1
Projects, the Bonds, the security therefor, and such other information as the Investor has deemed necessary or desirable
in connection with its decision to purchase the Bonds (collectively, the “Investor Information”). The Investor has
received a copy of this Limited Offering Memorandum relating to the Bonds. The Investor acknowledges that it has
assumed responsibility for its review of the Investor Information, and it has not relied upon any advice, counsel,
representation, or information from the City in connection with the Investor’s purchase of the Bonds. The Investor
agrees that none of the City, its councilmembers, officers, or employees shall have any liability to the Investor
whatsoever for or in connection with the Investor’s decision to purchase the Bonds except for gross negligence, fraud,
or willful misconduct. For the avoidance of doubt, it is acknowledged that the Underwriter is not deemed an officer
or employee of the City.
6. The Investor acknowledges that the obligations of the City under the Indenture are special, limited
obligations payable solely from amounts paid by the City to the Trustee pursuant to the terms of the Indenture and the
City shall not be directly or indirectly or contingently or morally obligated to use any other moneys or assets of the
City for amounts due under the Indenture. The Investor understands that the Bonds are not secured by any pledge of
any moneys received or to be received from taxation by the City, the State, or any political subdivision or taxing
district thereof; that the Bonds will never represent or constitute a general obligation or a pledge of the full faith and
credit of the City, the State, or any political subdivision thereof; that no right will exist to have taxes levied by the
City, the State, or any political subdivision thereof for the payment of principal of and interest on the Bonds; and that
the liability of the City and the State with respect to the Bonds is subject to further limitations as set forth in the Bonds
and the Indenture.
7. The Investor has made its own inquiry and analysis with respect to the Bonds and the security
therefor. The Investor is aware that the development of the District involves certain economic and regulatory variables
and risks that could adversely affect the security for the Bonds.
8. The Investor acknowledges that the sale of the Bonds to the Investor is made in reliance upon the
certifications, representations, and warranties described in items 1-7 above.
DESCRIPTION OF THE BONDS
General Description
The Bonds will mature on the dates and in the amounts set forth on the inside cover page of this Limited
Offering Memorandum. Interest on the Bonds will accrue from their date of delivery to the Underwriter (the “Delivery
Date”) and will be computed on the basis of a 360-day year of twelve 30-day months. Interest on the Bonds will be
payable on each March 15 and September 15, commencing March 15, 2026* (each an “Interest Payment Date”), until
maturity or prior redemption. Regions Bank is the initial Trustee, Paying Agent, and Registrar for the Bonds.
The Bonds will be issued in fully registered form, without coupons, in authorized denominations of $100,000
of principal and any integral multiple of $1,000 in excess thereof (“Authorized Denominations”). The City prohibits
any Bond to be issued in a denomination of less than $100,000 and further prohibits the assignment of a CUSIP
number to any Bond with a denomination of less than $100,000, and any attempt to accomplish either of the foregoing
shall be void and of no effect. Upon initial issuance, the ownership of the Bonds will be registered in the name of
Cede & Co., as nominee for The Depository Trust Company, New York, New York (“DTC”), and purchases of
beneficial interests in the Bonds will be made in book-entry only form. See “BOOK-ENTRY ONLY SYSTEM” and
SUITABILITY FOR INVESTMENT.”
Preliminary; subject to change.
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Redemption Provisions
Optional Redemption. The City reserves the right and option to redeem the Bonds before their scheduled
maturity date, in whole or in part, on any date on or after September 15, 20 , such redemption date or dates to be fixed
by the City, at the redemption price of par plus accrued and unpaid interest to the date of redemption (the “Redemption
Price”).
Extraordinary Optional Redemption. The City reserves the right and option to redeem Bonds before their
respective scheduled maturity dates, in whole or in part, at the Redemption Price, from amounts on deposit in the
Redemption Fund as a result of Prepayments (including related transfers to the Redemption Fund from the Reserve
Account of the Reserve Fund made pursuant to the Indenture) or any other transfers to the Redemption Fund under
the terms of the Indenture. See “ASSESSMENT PROCEDURES – Prepayment of Improvement Area #1
Assessments” for the definition and description of Prepayments and “APPENDIX B – Form of Indenture.”
Mandatory Sinking Fund Redemption. The Bonds maturing on September 15 in the years 20 , 20 , and 20_
the “Term Bonds”) are subject to mandatory sinking fund redemption prior to their respective maturities and will be
redeemed by the City in part at the Redemption Price from moneys available for such purpose in the Principal and
Interest Account of the Bond Fund pursuant to the Indenture, on the dates and in the respective Sinking Fund
Installments as set forth in the following schedules:
Term Bonds Maturing September 15, 20
Redemption Date Sinking Fund Installment Amount
September 15, 20 $
September 15, 20
September 15, 20
September 15, 20
September 15, 20 †
Term Bonds Maturing September 15, 20
Redemption Date Sinking Fund Installment Amount
September 15, 20 $
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20 †
Stated maturity.
At least thirty (30) days prior to each mandatory sinking fund redemption date, and subject to any prior
reduction authorized by the Indenture, the Trustee will select by lot, or any by any other customary method that results
in random selection, a principal amount of Bonds of such maturity equal to the Sinking Fund Installment amount of
such Bonds to be redeemed, shall call such Bonds for redemption on such scheduled mandatory sinking fund
redemption date, and shall give notice of such mandatory sinking fund redemption, as provided in the Indenture.
The principal amount of Bonds required to be redeemed on any mandatory sinking fund redemption date
shall be reduced, at the option of the City, by the principal amount of any Bonds of such maturity which, at least 30
days prior to the mandatory sinking fund redemption date shall have been acquired by the City at a price not exceeding
the principal amount of such Bonds plus accrued unpaid interest to the date of purchase thereof, and delivered to the
Trustee for cancellation.
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The Sinking Fund Installments of Term Bonds required to be redeemed on any mandatory sinking fund
redemption date shall be reduced in integral multiples of $1,000 by any portion of such Bonds, which, at least 30 days
prior to the mandatory sinking fund redemption date, shall have been redeemed pursuant to the optional redemption
or extraordinary optional redemption provisions in the Indenture and not previously credited to a mandatory sinking
fund redemption.
Notice of Redemption. Upon written notification by the City to the Trustee of the exercise of any redemption,
the Trustee shall give notice of any redemption of Bonds by sending notice by first class United States mail, postage
prepaid, not less than 30 days before the date fixed for redemption, to the Owner of each Bond or portion thereof to
be redeemed, at the address shown in the Register. Any such notice shall be conclusively presumed to have been duly
given, whether or not the Owner receives such notice.
Notice of redemption having been given as provided in the Indenture, the Bonds or portions thereof called
for redemption shall become due and payable on the date fixed for redemption provided that funds for the payment of
the Redemption Price of such Bonds to the date fixed for redemption are on deposit with the Trustee; thereafter, such
Bonds or portions thereof shall cease to bear interest from and after the date fixed for redemption, whether or not such
Bonds are presented and surrendered for payment on such date.
With respect to any optional redemption of the Bonds, unless the Trustee has received funds sufficient to pay
the Redemption Price of the Bonds to be redeemed before giving of a notice of redemption, the notice may state the
City may condition redemption on the receipt of such funds by the Trustee on or before the date fixed for the
redemption, or on the satisfaction of any other prerequisites set forth in the notice of redemption. If a conditional
notice of redemption is given and such prerequisites to the redemption are not satisfied and sufficient funds are not
received, the notice shall be of no force and effect, the City shall not redeem the Bonds, and the Trustee shall give
notice, in the manner in which the notice of redemption was given, that the Bonds have not been redeemed.
The City has the right to rescind any optional redemption or extraordinary optional redemption by written
notice to the Trustee on or prior to the date fixed for redemption. Any notice of redemption shall be cancelled and
annulled if for any reason funds are not available on the date fixed for redemption for the payment in full of the Bonds
then called for redemption, and such cancellation shall not constitute an Event of Default under the Indenture. Upon
written direction from the City, the Trustee shall mail notice of rescission of redemption in the same manner notice of
redemption was originally provided.
Partial Redemption. If less than all of the Bonds are to be redeemed pursuant to the Indenture, Bonds may
be redeemed in minimum principal amounts of $1,000 or any integral thereof. Each Bond will be treated as
representing the number of Bonds that is obtained by dividing the principal amount of such Bond by $1,000. No
redemption will result in a Bond in a denomination of less than an Authorized Denomination; provided, however, if
the amount of Outstanding Bonds is less than an Authorized Denomination after giving effect to such partial
redemption, a Bond in the principal amount equal to the unredeemed portion, but not less than $1,000, may be issued.
If less than all of the Bonds are called for optional redemption pursuant to the Indenture, the Trustee will rely
on directions provided in a City Certificate in selecting the Bonds to be redeemed.
If less than all of the Bonds are called for extraordinary optional redemption pursuant to the Indenture, the
Bonds or portion of a Bond to be redeemed will be allocated on a pro rata basis (as nearly as practicable) among all
Outstanding Bonds. If less than all Bonds within a Stated Maturity are called for extraordinary optional redemption,
the Trustee shall call randomly by lot the Bonds, or portions thereof, within such Stated Maturity and in such principal
amounts, for redemption.
Upon surrender of any Bond for redemption in part, the Trustee in accordance with the Indenture, will
authenticate and deliver an exchange Bond or Bonds in an aggregate principal amount equal to the unredeemed portion
of the Bond so surrendered, such exchange being without charge.
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BOOK-ENTRY ONLY SYSTEM
This section describes how ownership of the Bonds is to be transferred and how the principal of, premium,
if any, and interest on the Bonds are to be paid to and credited by DTC while the Bonds are registered in its nominee
name. The information in this section concerning DTC and the Book-Entry-Only System has been provided by DTC
for use in disclosure documents such as this Limited Offering Memorandum. The information in this section
concerning DTC and DTC’s book-entry-only system has been obtained from sources that the City believes to be
reliable, but none of the City, the City’s Financial Advisor or the Underwriter takes any responsibility for the accuracy
or completeness thereof.
The City cannot and does not give any assurance that (1) DTC will distribute payments of debt service on
the Bonds, or redemption or other notices, to DTC participants, (2) DTC participants or others will distribute debt
service payments paid to DTC or its nominee (as the registered owner of the Bonds), or redemption or other notices,
to the Beneficial Owners, or that they will do so on a timely basis, or (3) DTC will serve and act in the manner
described in this Limited Offering Memorandum. The current rules applicable to DTC are on file with the United
States Securities and Exchange Commission (the “SEC”), and the current procedures of DTC to be followed in dealing
with DTC participants are on file with DTC.
DTC will act as securities depository for the Bonds. The Bonds will be issued as fully registered securities
registered in the 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 security certificate will be issued for each maturity of the
Bonds, each 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 registered 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 SEC. 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 affect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial
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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 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. In the alternative, Beneficial
Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided
directly to them.
Redemption notices for the Bonds shall be sent to DTC. If less than all Bonds of the same maturity are being
redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant of such maturity
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).
Principal, interest, and all other payments 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/Registrar, on the
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 securities
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 nor its nominee, the Trustee, the Paying Agent/Registrar, or the City, subject to any
statutory or regulatory requirements as may be in effect from time to time. Payment of principal, interest, and all other
payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the
responsibility of the Trustee, the Paying Agent/Registrar or the City, 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 securities depository with respect to the Bonds at any time by
giving reasonable notice to the City, the Trustee, or the Paying Agent/Registrar. Under such circumstances, in the
event that a successor depository is not obtained, Bond certificates are required to be printed and delivered.
The City may decide to discontinue use of the system of book-entry-only transfers through DTC (or a
successor securities depository). In that event, Bond certificates will be printed and delivered. Thereafter, Bond
certificates may be transferred and exchanged as described in the Indenture.
The information in this section concerning DTC and DTC’s book-entry system has been obtained from
sources that the City believes to be reliable, but none of the City, the City’s Financial Advisor, or the Underwriter take
any responsibility for the accuracy thereof.
NONE OF THE CITY, THE TRUSTEE, THE PAYING AGENT/REGISTRAR, THE CITY’S FINANCIAL
ADVISOR, OR THE UNDERWRITER WILL HAVE ANY RESPONSIBILITY OR OBLIGATION TO THE DTC
PARTICIPANTS OR THE PERSONS FOR WHOM THEY ACT AS NOMINEE WITH RESPECT TO THE
PAYMENTS TO OR THE PROVIDING OF NOTICE FOR THE DTC DIRECT PARTICIPANTS, THE INDIRECT
PARTICIPANTS OR THE BENEFICIAL OWNERS OF THE BONDS. THE CITY CANNOT AND DOES NOT
GIVE ANY ASSURANCES THAT DTC, THE DIRECT PARTICIPANTS, THE INDIRECT PARTICIPANTS, OR
OTHERS WILL DISTRIBUTE PAYMENTS OF PRINCIPAL OF OR INTEREST ON THE BONDS PAID TO DTC
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OR ITS NOMINEE, AS THE REGISTERED OWNER, OR PROVIDE ANY NOTICES TO THE BENEFICIAL
OWNERS OR THAT THEY WILL DO SO ON A TIMELY BASIS, OR THAT DTC WILL ACT IN THE MANNER
DESCRIBED IN THIS LIMITED OFFERING MEMORANDUM. THE CURRENT RULES APPLICABLE TO
DTC ARE ON FILE WITH THE SEC, AND THE CURRENT PROCEDURES OF DTC TO BE FOLLOWED IN
DEALING WITH DTC PARTICIPANTS ARE ON FILE WITH DTC.
Use of Certain Terms in Other Sections of this Limited Offering Memorandum. In reading this Limited
Offering Memorandum it should be understood that while the Bonds are in the Book-Entry-Only System, references
in other sections of this Limited Offering Memorandum to registered owners should be read to include the person for
which the participant acquires an interest in the Bonds, but (i) all rights of ownership must be exercised through DTC
and the Book-Entry-Only System and (ii) except as described above, notices that are to be given to registered owners
under the Indenture will be given only to DTC.
SECURITY FOR THE BONDS
The following is a summary of certain provisions contained in the Indenture. Reference is made to the
Indenture for a full statement of the terms and provisions of the Bonds. Investors must read the entire Indenture to
obtain information essential to the making of an informed investment decision. See “APPENDIX B – Form of
Indenture.”
General
THE BONDS ARE SPECIAL, LIMITED OBLIGATIONS OF THE CITY PAYABLE SOLELY FROM A
FIRST LIEN ON, SECURITY INTEREST IN, AND PLEDGE OF THE TRUST ESTATE, AS AND TO THE
EXTENT PROVIDED IN THE INDENTURE. THE BONDS DO NOT GIVE RISE TO A CHARGE AGAINST THE
GENERAL CREDIT OR TAXING POWER OF THE CITY AND ARE PAYABLE SOLELY FROM THE
SOURCES IDENTIFIED IN THE INDENTURE. THE OWNERS OF THE BONDS SHALL NEVER HAVE THE
RIGHT TO DEMAND PAYMENT THEREOF OUT OF MONEY RAISED OR TO BE RAISED BY TAXATION,
OR OUT OF ANY FUNDS OF THE CITY OTHER THAN THE TRUST ESTATE, AS AND TO THE EXTENT
PROVIDED IN THE INDENTURE. NO OWNER OF THE BONDS SHALL HAVE THE RIGHT TO DEMAND
ANY EXERCISE OF THE CITY’S TAXING POWER TO PAY THE PRINCIPAL OF THE BONDS OR THE
INTEREST OR REDEMPTION PREMIUM, IF ANY, THEREON. THE CITY SHALL HAVE NO LEGAL OR
MORAL OBLIGATION TO PAY THE BONDS OUT OF ANY FUNDS OF THE CITY OTHER THAN THE
TRUST ESTATE. SEE “APPENDIX B – FORM OF INDENTURE.”
The principal of, premium, if any, and interest on the Bonds are secured by a first lien on, security interest
in, and pledge of the Trust Estate, consisting primarily of Pledged Revenues derived from Improvement Area #1
Assessments to be levied against Improvement Area #1 Assessed Property and other assets comprising the Trust
Estate, all to the extent and upon the conditions described herein and in the Indenture. See “APPENDIX B – Form of
Indenture.” In accordance with the PID Act, the City has caused the preparation of a Service and Assessment Plan in
connection with the levy of assessments in the District (including the Improvement Area #1 Assessments), and expects
to adopt a final Service and Assessment Plan in connection with the authorization of the issuance of the Bonds. The
Service and Assessment Plan describes the special benefit received by the property within the District, including
Improvement Area #1, provides the basis and justification for the determination of special benefit on such property,
establishes the methodology for the levy of Improvement Area #1 Assessments, and provides for the allocation of
Pledged Revenues for payment of principal of, premium, if any, and interest on the Bonds. The Service and
Assessment Plan is reviewed and updated annually for the purpose of determining the annual budget for improvements
and the Improvement Area #1 Annual Installments of Improvement Area #1 Assessments due in a given year. The
determination by the City of the assessment methodology set forth in the Service and Assessment Plan is the result of
the discretionary exercise by the City Council of its legislative authority and governmental powers and is conclusive
and binding on all current and future landowners within the District, including Improvement Area #1. See
APPENDIX C – Form of Service and Assessment Plan.”
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Pledged Revenues
The City is authorized by the PID Act, the Assessment Ordinance, and other provisions of law to finance the
Improvement Area #1 Projects by levying Improvement Area #1 Assessments upon properties in Improvement Area
1 of the District benefitted thereby. For a description of the assessment methodology and the amounts of
Improvement Area #1 Assessments levied in Improvement Area #1 of the District, see “ASSESSMENT
PROCEDURES” and “APPENDIX C – Form of Service and Assessment Plan.”
Pursuant to the Indenture:
Additional Interest” means the amount collected by the application of the Additional Interest Rate.
Additional Interest Rate” means the 0.50% additional interest charged on the Improvement Area #1
Assessments pursuant to Section 372.018 of the PID Act.
Annual Collection Costs” mean with respect to Improvement Area #1 Projects, the actual costs paid or
incurred by or on behalf of the Developer, (either directly or through affiliates), including: (1) the costs for the design,
planning, financing, administration/management, acquisition, installation, construction and/or implementation of such
Improvement Area #1 Projects; (2) the fees paid for obtaining permits, licenses, or other governmental approvals for
such Improvement Area #1 Projects; (3) the costs for external professional services, such as engineering, geotechnical,
surveying, land planning, architectural landscapers, appraisals, legal, accounting, and similar professional services;
4) the costs for all labor, bonds, and materials, including equipment and fixtures, owing to contractors, builders, and
materialmen engaged in connection with the acquisition, construction, or implementation of the Improvement Area
1 Projects; (5) all related permitting and public approval expenses, and architectural, engineering, consulting, and
other governmental fees and charges; and (6) costs to implement, administer, and manage the above described
activities including, but not limited to, a construction management fee equal to four percent (4%) of construction costs
if managed by or on behalf of the Developer.
Annual Service Plan Update” means an update to the Service and Assessment Plan prepared no less
frequently than annually by the Administrator and approved by the City Council.
Assessment Revenues” means the revenues received by the City from the collection of Improvement Area
1 Assessments, including Prepayments, Improvement Area #1 Annual Installments, and Foreclosure Proceeds.
Delinquent Collection Costs” means costs related to the foreclosure on Improvement Area #1 Assessed
Property and the costs of collection of delinquent Improvement Area #1 Assessments, delinquent Improvement Area
1 Annual Installments, or any other delinquent amounts due under the Service and Assessment Plan, including
penalties and reasonable attorney’s fees actually paid, but excluding amounts representing interest and penalty interest.
Foreclosure Proceeds” means the proceeds, including interest and penalty interest, received by the City from
the enforcement of the Improvement Area #1 Assessments against any Improvement Area #1 Assessed Property,
whether by foreclosure of lien or otherwise, but excluding and net of all Delinquent Collection Costs.
Improvement Area #1 Annual Installments” means, with respect to each Parcel of Improvement Area #1
Assessed Property, each annual payment of (i) the principal of and interest on the Improvement Area #1 Assessments
as shown on the Improvement Area #1 Assessment Roll or in an Annual Service Plan Update, as shown in Exhibit F-
2 to the Service and Assessment Plan, and calculated as provided in Section VI of the Service and Assessment Plan,
ii) Annual Collection Costs, and (iii) the Additional Interest.
Improvement Area #1 Assessed Property” means the property located in Improvement Area #1 that benefits
from the Improvement Area #1 Projects.
Improvement Area #1 Assessment Roll” means the “Improvement Area #1 Assessment Roll” attached to
the Service and Assessment Plan as Exhibit F-1, as updated, modified, or amended from time to time.
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Improvement Area #1 Assessments” means an assessment levied against Improvement Area #1 Assessed
Property based on the special benefit conferred on such Improvement Area #1 Assessed Property by the Improvement
Area #1 Projects.
Other Obligations” means any bonds, temporary notes, time warrants, or an obligation under an installment
sale contract or reimbursement agreement secured in whole or in part by an assessment, other than the Improvement
Area #1 Assessments securing the Bonds, levied against property within Improvement Area #1 in accordance with the
PID Act.
Pledged Funds” means, collectively, the Pledged Revenue Fund, the Bond Fund, the Project Fund, the
Reserve Fund, and the Redemption Fund.
Pledged Revenues” mean, collectively, the (i) Assessment Revenues (excluding the portion of the
Improvement Area #1 Assessments and Improvement Area #1 Annual Installments collected for the payment of
Annual Collection Costs and Delinquent Collection Costs, as set forth in the Service and Assessment Plan), (ii) the
moneys held in any of the Pledged Funds, and (iii) any additional revenues that the City may pledge to the payment
of the Bonds.
Trust Estate” means the Trust Estate described in the granting clauses of the Indenture.
The City will covenant in the Indenture that it will take and pursue all actions permissible under Applicable
Laws to cause the Improvement Area #1 Assessments to be collected and the liens thereof to be enforced continuously.
See “SECURITY FOR THE BONDS – Pledged Revenue Fund,” “APPENDIX B – Form of Indenture,” and
APPENDIX C – Form of Service and Assessment Plan.”
Collection and Deposit of Improvement Area #1 Assessments
The Improvement Area #1 Assessments shown on the Improvement Area #1 Assessment Roll, together with
the interest thereon, shall first be applied to the payment of the principal of and interest on the Bonds as and to the
extent provided in the Service and Assessment Plan and the Indenture. In the event the City owes Rebatable Arbitrage
to the United States Government, the Improvement Area #1 Assessments shall first be applied to pay the full amount
of Rebatable Arbitrage owed by the City, prior to any transfers to the Bond Fund.
The Improvement Area #1 Assessments to be assessed to pay debt service on the Bonds, together with interest
thereon, shall be payable in Improvement Area #1 Annual Installments established by the Assessment Ordinance and
the Service and Assessment Plan to correspond, as nearly as practicable, to the debt service requirements for the
Bonds. An Improvement Area #1 Annual Installment of an Improvement Area #1 Assessment will be made payable
in the Assessment Ordinance in each fiscal year of the City preceding the date of final maturity of the Bonds which,
if collected, will be sufficient to first pay debt service requirements attributable to Improvement Area #1 Assessments
in the Service and Assessment Plan. Each Improvement Area #1 Annual Installment is payable as provided in the
Service and Assessment Plan and the Assessment Ordinance.
The portions of the Improvement Area #1 Annual Installments of Improvement Area #1 Assessments
collected to pay Annual Collection Costs and Delinquent Collection Costs shall be deposited in the Administrative
Fund and shall not constitute Pledged Revenues.
Unconditional Levy of Improvement Area #1 Assessments
The City will impose Improvement Area #1 Assessments on the Improvement Area #1 Assessed Property to
pay the principal of and interest on the Bonds scheduled for payment from Pledged Revenues as described in the
Indenture and in the Service and Assessment Plan and coming due during each Fiscal Year. The Improvement Area
1 Assessments are effective on the date of, and strictly in accordance with the terms of, the Assessment Ordinance.
Each Improvement Area #1 Assessment may be paid in full or in part at any time, or in periodic Improvement Area
1 Annual Installments over a period of time equal to the term of the Bonds, which installments shall include interest
on the Improvement Area #1 Assessments. Pursuant to the Assessment Ordinance, interest on the Improvement Area
1 Assessments will be calculated at the rate of interest on the Bonds plus the Additional Interest rated calculated on
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the basis of a 360-day year of twelve 30-day months. Such rate may be adjusted as described in the Service and
Assessment Plan. Each Improvement Area #1 Annual Installment, including the interest on the unpaid amount of an
Improvement Area #1 Assessment, shall be calculated annually during the Annual Service Plan Update and shall be
due when billed, expected to be on or about October 1 of each year. Each Improvement Area #1 Annual Installment
together with interest thereon shall be delinquent if not paid prior to February 1 of the following year. The initial
Improvement Area #1 Annual Installments of the Improvement Area #1 Assessments will be due on or about October
1, 2026, and will be delinquent if not paid prior to February 1, 2027.
As authorized by Section 372.018(b) of the PID Act, the City will calculate and collect, each year while the
Bonds are Outstanding and unpaid, a portion of each Improvement Area #1 Annual Installment to pay the Annual
Collection Costs. The portion of each Improvement Area #1 Annual Installment used to pay the Annual Collection
Costs shall remain in effect from year to year until all Bonds are finally paid or until the City adjusts the amount after
an annual review in any year pursuant to Section 372.013 of the PID Act. The amount collected to pay Annual
Collection Costs shall be due in the manner set forth in the Assessment Ordinance on or about October 1 of each year
and shall be delinquent if not paid by February 1 of the following year. Amounts collected to pay Annual Collection
Costs do not secure repayment of the Bonds.
There is no discount for the early payment of Improvement Area #1 Assessments.
The PID Act provides that the Improvement Area #1 Assessments (including any reassessment, with interest,
the expense of collection and reasonable attorney’s fees, if incurred) are a first and prior lien (the “Assessment Lien”)
against the Improvement Area #1 Assessed Property, superior to all other liens and claims, except liens or claims for
State, county, school district, or municipality ad valorem taxes and are a personal liability of and charge against the
owners of property, regardless of whether the owners are named. Pursuant to the PID Act, the Assessment Lien is
effective from the date of the Assessment Ordinance until the Improvement Area #1 Assessments are paid (or
otherwise discharged), and is enforceable by the City Council in the same manner that an ad valorem property tax
levied against real property may be enforced by the City Council. See “ASSESSMENT PROCEDURES.” The
Assessment Lien is superior to any homestead rights of a property owner that were properly claimed after the adoption
of the Assessment Ordinance. However, an Assessment Lien may not be foreclosed upon if any homestead rights of
a property owner were properly claimed prior to the adoption of the Assessment Ordinance (“Pre-existing Homestead
Rights”) for as long as such rights are maintained on the property. See “BONDHOLDERS’ RISKS – Assessment
Limitations.”
Failure to pay an Improvement Area #1 Annual Installment when due will not accelerate the payment of the
remaining Improvement Area #1 Annual Installments of the Improvement Area #1 Assessments and such remaining
Improvement Area #1 Annual Installments (including interest) shall continue to be due and payable at the same time
and in the same amount and manner as if such default had not occurred.
Perfected Security Interest
The lien on, security interest in, and pledge of the Trust Estate to secure the Bonds shall be valid and binding
and fully perfected from and after the Delivery Date, without physical delivery or transfer of control of the Trust
Estate, the filing of the Indenture or any other act; all as provided in Texas Government Code, Chapter 1208, as
amended, which applies to the issuance of the Bonds and the pledge of the Trust Estate granted by the City under the
Indenture, and such pledge is therefore valid, effective, and perfected. If State law is amended at any time while the
Bonds are Outstanding such that the pledge of the Trust Estate granted by the City under the Indenture is to be subject
to the filing requirements of Chapter 9, Business and Commerce Code, then in order to preserve to the registered
owners of the Bonds the perfection of the security interest in said pledge, the City agrees to take such measures as it
determines are reasonable and necessary under State law to comply with the applicable provisions of Chapter 9,
Business and Commerce Code and enable a filing to perfect the security interest in said pledge to occur.
Pledged Revenue Fund
Periodically upon receipt thereof, the City shall transfer or cause to be transferred, pursuant to a City
Certificate provided to the Trustee for deposit to the Pledged Revenue Fund the Improvement Area #1 Assessments
and Improvement Area #1 Annual Installments, other than the portion of the Improvement Area #1 Assessments and
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Improvement Area #1 Annual Installments allocated to the payment of Annual Collection Costs and Delinquent
Collection Costs, which shall be deposited to the Administrative Fund in accordance with the Indenture. Following
such deposit to the Pledged Revenue Fund, the City shall transfer or cause to be transferred pursuant to a City
Certificate provided to the Trustee the following amounts from the Pledged Revenue Fund to the following Accounts:
i) first, to the Bond Pledged Revenue Account of the Pledged Revenue Fund, an amount sufficient to pay debt service
on the Bonds next coming due, and (ii) second, if necessary, to the Reserve Account of the Reserve Fund, an amount
to cause the amount in the Reserve Account to equal the Reserve Account Requirement. Notwithstanding the
foregoing, the Additional Interest shall only be utilized for the purposes set forth in the Indenture and, immediately
following the initial deposit to the Pledged Revenue Fund, prior to any other transfers or deposits being made as
described in this paragraph, if the Delinquency and Prepayment Reserve Account of the Reserve Fund does not contain
the Delinquency and Prepayment Reserve Requirement and Additional Interest is collected, then all such Additional
Interest will be transferred into the Delinquency and Prepayment Reserve Account until the Delinquency and
Prepayment Reserve Requirement is met. In addition, in the event the City owes Rebatable Arbitrage to the United
States Government pursuant to the Indenture, the City shall provide a City Certificate to the Trustee to transfer to the
Rebate Fund, prior to any other transfer described in this paragraph, the full amount of Rebatable Arbitrage owed by
the City, as further described in the Indenture. If any funds remain on deposit in the Pledged Revenue Fund after the
foregoing deposits and the deposits of Prepayments and Foreclosure Proceeds, as described below, are made, the City
shall have the option, in its sole and absolute discretion, to use such excess funds for any one or more of the following
purposes: (i) to pay costs of the Improvement Area #1 Projects, (ii) to pay other costs permitted by the PID Act, or
iii) to deposit such excess into the Redemption Fund to redeem Bonds as provided in the Indenture. Along with each
transfer to the Trustee, the City shall provide a certificate as to the funds, accounts, and payments into which the
amounts are to be deposited or paid.
From time to time as needed to pay the obligations relating to the Bonds, but no later than five (5) Business
Days before each Interest Payment Date, the Trustee shall withdraw from the Pledged Revenue Fund and transfer to
the Principal and Interest Account of the Bond Fund, an amount, taking into account any amounts then on deposit in
such Principal and Interest Account and any expected transfers from the Capitalized Interest Account to the Principal
and Interest Account, such that the amount on deposit in the Principal and Interest Account equals the principal
including any Sinking Fund Installments) and interest due on the Bonds on the next Interest Payment Date.
If, after the foregoing transfers and any transfer from the Reserve Fund as provided in the Indenture, there
are insufficient funds to make the payments provided in the preceding paragraph above, the Trustee shall apply the
available funds in the Principal and Interest Account first to the payment of interest, then to the payment of principal
including any Sinking Fund Installments) on the Bonds.
The Trustee shall transfer Prepayments to the Redemption Fund to be used to redeem Bonds pursuant the
Indenture promptly after deposit of such amounts into the Pledged Revenue Fund.
Promptly after the deposit of Foreclosure Proceeds into the Pledged Revenue Fund, the Trustee shall transfer
such Foreclosure Proceeds first to the Reserve Fund to restore any transfers from the Accounts within the Reserve
Fund made with respect to the particular Improvement Area #1 Assessed Property to which the Foreclosure Proceeds
relate (first, to replenish the Reserve Account Requirement and second, to replenish the Delinquency and Prepayment
Reserve Requirement), and second, to the Redemption Fund to be used to redeem Bonds pursuant to the Indenture.
After satisfaction of the requirement to provide for the payment of the principal and interest on the Bonds
and to fund any deficiency that may exist in the Reserve Fund, the Trustee shall transfer any Pledged Revenues
remaining in the Pledged Revenue Fund for the purposes set forth in the Indenture as directed by the City in a City
Certificate.
Bond Fund
On each Interest Payment Date, the Trustee shall withdraw from the Principal and Interest Account and
transfer to the Paying Agent/Registrar the principal (including any Sinking Fund Installments) and interest then due
and payable on the Bonds, less any amount to be used to pay interest on the Bonds on such Interest Payment Date
from the Capitalized Interest Account as provided below.
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If amounts in the Principal and Interest Account are insufficient for the purposes set forth above, the Trustee
shall withdraw from the Reserve Fund amounts to cover the amount of such insufficiency. Amounts so withdrawn
from the Reserve Fund shall be deposited in the Principal and Interest Account and transferred to the Paying
Agent/Registrar.
If, after the foregoing transfers and any transfer from the Reserve Fund as provided in the Indenture, there
are insufficient funds to make the payments provided above, the Trustee shall apply the available funds in the Principal
and Interest Account first to the payment of interest, then to the payment of principal (including any Sinking Fund
Installments) on the Bonds.
Moneys in the Capitalized Interest Account shall be used for the payment of all interest due on the Bonds on
March 15, 2026 and September 15, 2026.* Any amounts on deposit in the Capitalized Interest Account after the
payment of interest on the dates and in the amounts listed above shall be transferred shall be transferred, at the direction
of the City, to the Improvement Area #1 Bond Improvement Account of the Project Fund, or to the Redemption Fund
to be used to redeem Bonds, and the Capitalized Interest Account shall be closed.
Project Fund
Money on deposit in the Project Fund shall be used for the purposes specified in the Indenture.
Disbursements from the Costs of Issuance Account of the Project Fund shall be made by the Trustee to pay costs of
issuance of the Bonds pursuant to one or more City Certificates.
In order to receive the disbursement from the Costs of Issuance Account of the Project Fund or the
Improvement Area #1 Bond Improvement Account of the Project Fund on the Delivery Date, related to costs of
issuance of the Bonds or costs incurred in the creation of the District, the Developer shall execute a Closing
Disbursement Request to be delivered to the City no less than fifteen (15) business days prior to the Delivery Date.
In order to receive the disbursement for Improvement Area #1 Project Costs from the Improvement Area #1 Bond
Improvement Account of the Project Fund on the Delivery Date, the Developer shall execute a Certification for
Payment to be delivered to the City no later than fifteen (15) business days prior to the Delivery Date. Upon approval
by the City, the City shall submit such Closing Disbursement Request, together with a City Certificate directing such
disbursement, to the Trustee for disbursement to be made from the Costs of Issuance Account of the Project Fund or
the Improvement Area #1 Bond Improvement Account of the Project Fund, as applicable. Disbursements from the
Improvement Area #1 Bond Improvement Account of the Project Fund to pay Improvement Area #1 Project Costs
shall be made by the Trustee upon receipt by the Trustee of a properly executed and completed Certification for
Payment. The funds from the Improvement Area #1 Bond Improvement Account of the Project Fund shall be
disbursed in accordance with a Certification for Payment for Improvement Area #1 Projects as described in the CFA
Agreement.
Except as provided in the succeeding paragraphs below, money on deposit in the Improvement Area #1 Bond
Improvement Account of the Project Fund shall be used solely to pay Improvement Area #1 Project Costs.
If the City Representative determines in his or her sole discretion that certain amounts then on deposit in the
Improvement Area #1 Bond Improvement Account are not expected to be expended for purposes of the Project Fund
due to the abandonment, or constructive abandonment, of one or more of the Improvement Area #1 Projects such that,
in the opinion of the City Representative, it is unlikely that the amounts in the Improvement Area #1 Bond
Improvement Account will ever be expended for the purposes of the Project Fund, the City Representative shall file a
City Certificate with the Trustee which identifies the amounts then on deposit in the Improvement Area #1 Bond
Improvement Account that are not expected to be used for purposes of the Project Fund. If such City Certificate is so
filed, the identified amounts on deposit in the Improvement Area #1 Bond Improvement Account shall be transferred
to the Bond Fund or to the Redemption Fund to be used to redeem Bonds pursuant to the Indenture as directed by the
City Representative in a City Certificate filed with the Trustee. Upon such transfer, the Improvement Area #1 Bond
Improvement Account of the Project Fund shall be closed.
Preliminary; subject to change.
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In making any determination regarding the Project Fund pursuant to the Indenture, the City Representative
may conclusively rely upon a certificate of an Independent Financial Consultant.
Upon the filing of a City Certificate stating that all Improvement Area #1 Projects have been completed and
that all Improvement Area #1 Project Costs have been paid, or that any Improvement Area #1 Projects are not required
to be paid from the Project Fund pursuant to a Certification for Payment, the Trustee shall transfer the amount, if any,
remaining within the Improvement Area #1 Bond Improvement Account of the Project Fund to the Bond Fund or to
the Redemption Fund to be used to redeem Bonds pursuant to the Indenture as directed by the City Representative in
a City Certificate filed with the Trustee. Upon such transfer, the Improvement Area #1 Bond Improvement Account
of the Project Fund shall be closed.
Upon a determination by the City Representative that all costs of issuance of the Bonds have been paid, any
amounts remaining in the Costs of Issuance Account shall be transferred to the Improvement Area #1 Bond
Improvement Account of the Project Fund and used to pay the cost of Improvement Area #1 Project Costs or to the
Principal and Interest Account and used to pay interest on the Bonds, as directed in a City Certificate filed with the
Trustee, and the Costs of Issuance Account shall be closed.
In the event the Developer has not completed the Improvement Area #1 Projects by December 18, 2030, then
the City shall provide written direction to the Trustee to transfer all funds on deposit in the Improvement Area #1
Bond Improvement Account to the Redemption Fund to redeem Bonds pursuant to the Indenture. Upon such transfer,
the Improvement Area #1 Bond Improvement Account of the Project Fund shall be closed.
Reserve Fund (Reserve Account and Delinquency and Prepayment Reserve Account)
Pursuant to the Indenture, a Reserve Account will be created within the Reserve Fund, held by the Trustee
for the benefit of the Bonds, and initially funded with proceeds of the Bonds in the amount of the Reserve Account
Requirement. Pursuant to the Indenture, the “Reserve Account Requirement” for the Bonds shall be the least of (i)
Maximum Annual Debt Service on the Bonds as of their date of issuance, (ii) 125% of average Annual Debt Service
on the Bonds as of their date of issuance, and (iii) 10% of the proceeds of the Bonds; provided, however, that such
amount shall be reduced by the amount of any transfers made to the Redemption Fund as a result of Prepayments; and
provided further that as a result of (1) an optional redemption or (2) an extraordinary optional redemption, the Reserve
Account Requirement shall be reduced by a percentage equal to the pro rata principal amount of Bonds redeemed by
such redemption divided by the total principal amount of the Outstanding Bonds prior to such redemption. As of the
date of issuance of the Bonds, the Reserve Account Requirement is $_______________, which is an amount equal to
the [Maximum Annual Debt Service] on the Bonds as of their date of issuance.
The City will agree with the Owners of the Bonds to accumulate and, when accumulated, maintain in the
Reserve Account, an amount equal to not less than the Reserve Account Requirement. All amounts deposited in the
Reserve Account shall be used and withdrawn by the Trustee for the purpose of making transfers to the Principal and
Interest Account of the Bond Fund as provided in the Indenture.
The Trustee will transfer from the Pledged Revenue Fund to the Delinquency and Prepayment Reserve
Account on March 15 of each year, commencing March 15, 2026, an amount the City confirms to the Trustee is equal
to the Additional Interest until the Delinquency and Prepayment Reserve Requirement has been accumulated in the
Delinquency and Prepayment Reserve Account; provided, however, that at any time the amount on deposit in the
Delinquency and Prepayment Reserve Account is less than Delinquency and Prepayment Reserve Requirement, the
Trustee shall resume depositing the Additional Interest into the Delinquency and Prepayment Reserve Account until
the Delinquency and Prepayment Reserve Requirement has reaccumulated in the Delinquency and Prepayment
Reserve Account. In transferring the amounts pursuant to the Indenture, the Trustee may conclusively rely on a City
Certificate (which shall be based on the Improvement Area #1 Annual Installments as shown on the Improvement
Area #1 Assessment Roll in the Service and Assessment Plan) unless and until it receives a City Certificate directing
that a different amount be used. Whenever a transfer is made from the Reserve Account to the Bond Fund due to a
deficiency in the Bond Fund, the Trustee shall provide written notice thereof to the City, specifying the amount
withdrawn and the source of said funds. The Additional Interest shall continue to be collected and deposited pursuant
to the Indenture until the Bonds are no longer Outstanding.
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Delinquency and Prepayment Reserve Requirement” means an amount equal to 5.5% of the principal
amount of the Outstanding Bonds to be funded from the Additional Interest deposited to the Pledged Revenue Fund
and transferred to the Delinquency and Prepayment Reserve Account.
In the event of an extraordinary optional redemption of Bonds from the proceeds of a Prepayment pursuant
to the Indenture, the Trustee, pursuant to a City Certificate, shall transfer from the Reserve Account of the Reserve
Fund to the Redemption Fund the amount specified in such directions, which shall be an amount equal to the principal
amount of Bonds to be redeemed multiplied by the lesser of: (i) the amount required to be in the Reserve Account of
the Reserve Fund divided by the principal amount of Outstanding Bonds prior to the redemption, and (ii) the amount
actually in the Reserve Account of the Reserve Fund divided by the principal amount of Outstanding Bonds prior to
the redemption. If after such transfer, and after applying investment earnings on the Prepayment toward payment of
accrued interest, there are insufficient funds to pay the principal amount plus accrued and unpaid interest on such
Bonds to the date fixed for redemption of the Bonds to be redeemed as a result of such Prepayment, the Trustee shall
transfer an amount equal to the shortfall, or any additional amounts necessary to permit the Bonds to be redeemed in
minimum principal amounts of $1,000, from the Delinquency and Prepayment Reserve Account to the Redemption
Fund to be applied to the redemption of the Bonds.
Whenever, on any Interest Payment Date, or on any other date at the written request of a City Representative,
the value of cash and Value of Investment Securities on deposit in the Reserve Account exceeds the Reserve Account
Requirement, the Trustee shall provide written notice to the City Representative of the amount of the excess. Such
excess shall be transferred to the Principal and Interest Account to be used for the payment of interest on the Bonds
on the next Interest Payment Date in accordance with the Indenture, unless within thirty days of such notice to the
City Representative, the Trustee receives a City Certificate instructing the Trustee to apply such excess: (i) to pay
amounts due to the U.S. Government in accordance with the Code, (ii) to the Administrative Fund in an amount not
more than the Annual Collection Costs for the Bonds, (iii) to the Improvement Area #1 Bond Improvement Account
of the Project Fund to pay Improvement Area #1 Project Costs if such application and the expenditure of funds is
expected to occur within three years, or (iv) to the Redemption Fund to be applied to the redemption of Bonds.
Whenever, on any Interest Payment Date, or on any other date at the written request of a City Representative,
the amounts on deposit in the Delinquency and Prepayment Reserve Account exceed the Delinquency and Prepayment
Reserve Requirement, the Trustee shall provide written notice to the City of the amount of the excess, and such excess
shall be transferred, at the direction of the City pursuant to a City Certificate, to the Administrative Fund for the
payment of Annual Collection Costs or to the Redemption Fund to be used to redeem Bonds pursuant to the Indenture.
In the event that the Trustee does not receive a City Certificate directing the transfer of such excess to the
Administrative Fund within forty-five (45) days of providing notice to the City of such excess, the Trustee shall
transfer such excess to the Redemption Fund to redeem Bonds pursuant to the Indenture and provide the City with
written notification of the transfer. The Trustee shall incur no liability for the accuracy or validity of the transfer so
long as the Trustee made such transfer in full compliance with the Indenture.
Whenever, on any Interest Payment Date, the amount on deposit in the Bond Fund is insufficient to pay the
debt service on the Bonds due on such date, the Trustee shall transfer first from the Delinquency and Prepayment
Reserve Account of the Reserve Fund and second from the Reserve Account of the Reserve Fund to the Bond Fund
the amounts necessary to cure such deficiency.
At the final maturity of the Bonds, the amount on deposit in the Reserve Account and the Delinquency and
Prepayment Reserve Account shall be transferred to the Principal and Interest Account and applied to the payment of
the principal of the Bonds.
If, after a Reserve Account withdrawal, the amount on deposit in the Reserve Account is less than the Reserve
Account Requirement, the Trustee shall transfer from the Pledged Revenue Fund to the Reserve Account the amount
of such deficiency, but only to the extent that such amount is not required for the timely payment of principal, interest,
or Sinking Fund Installments.
If the amount held in the Reserve Fund together with the amount held in the Pledged Revenue Fund, the
Bond Fund, and Redemption Fund is sufficient to pay the principal amount and of all Outstanding Bonds on the next
date the Bonds may be optionally redeemed by the City at a redemption price of par, together with the unpaid interest
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accrued on such Bonds as of such date, the moneys shall be transferred to the Redemption Fund and thereafter used
to redeem all Bonds on such date.
Administrative Fund
The City will create under the Indenture an Administrative Fund held by the Trustee. Periodically, upon
receipt thereof, the City shall deposit or cause to be deposited to the Administrative Fund the portion of the
Improvement Area #1 Assessments and Improvement Area #1 Annual Installments allocated to the payment of Annual
Collection Costs and Delinquent Collection Costs, as set forth in the Service and Assessment Plan. Moneys in the
Administrative Fund shall be held by the Trustee separate and apart from the other Funds created and administered
under the Indenture and used as directed by a City Certificate solely for the purposes set forth in the Service and
Assessment Plan, including payment of the Annual Collection Costs and Delinquent Collection Costs. See
APPENDIX C – Form of Service and Assessment Plan.”
THE ADMINISTRATIVE FUND IS NOT PART OF THE TRUST ESTATE AND IS NOT
SECURITY FOR THE BONDS.
Defeasance
Any Outstanding Bonds shall, prior to the Stated Maturity or redemption date thereof, be deemed to have
been paid and no longer Outstanding within the meaning of the Indenture (a “Defeased Debt”), when payment of the
principal of, premium, if any, on such Defeased Debt, plus interest thereon to the due date thereof (whether such due
date be by reason of maturity, redemption, or otherwise), either (i) shall have been made in accordance with the terms
thereof, or (ii) shall have been provided by irrevocably depositing with the Trustee, in trust, and irrevocably set aside
exclusively for such payment, (A) money sufficient to make such payment, or (B) Defeasance Securities that mature
as to principal and interest in such amount and at such times as will insure the availability, without reinvestment, of
sufficient money to make such payment, and all necessary and proper fees, compensation, and expenses of the Trustee
pertaining to the Bonds with respect to which such deposit is made shall have been paid or the payment thereof
provided for to the satisfaction of the Trustee. Neither Defeasance Securities nor moneys deposited with the Trustee
nor principal or interest payments on any such Defeasance Securities shall be withdrawn or used for any purpose other
than, and shall be held in trust for, the payment of the principal of and interest on the Bonds and shall not be part of
the Trust Estate. Any cash received from such principal of and interest on such Defeasance Securities deposited with
the Trustee, if not then needed for such purpose, shall be reinvested in Defeasance Securities as directed by the City
maturing at times and in amounts sufficient to pay when due the principal of and interest on the Bonds on and prior
to such redemption date or maturity date thereof, as the case may be. Any payment for Defeasance Securities
purchased for the purpose of reinvesting cash as aforesaid shall be made only against delivery of such Defeasance
Securities.
Defeasance Securities” means Investment Securities then authorized by applicable law for the investment
of funds to defease public securities. “Investment Securities” means those authorized investments described in the
Public Funds Investment Act, Chapter 2256, Texas Government Code, as amended (the “PFIA”), which investments
are, at the time made, included in and authorized by the City’s official investment policy as approved by the City
Council from time to time. Under current State law, Investment Securities that are authorized for the investment of
funds to defease public securities are (a) direct, noncallable obligations of the United States of America, including
obligations that are unconditionally guaranteed by the United States of America; (b) noncallable obligations of an
agency or instrumentality of the United States of America, including obligations that are unconditionally guaranteed
or insured by the agency or instrumentality, and that, on the date the governing body of the City adopts or approves
the proceedings authorizing the issuance of refunding bonds, are rated as to investment quality by a nationally
recognized investment rating firm not less than “AAA” or its equivalent; and (c) noncallable obligations of a state or
an agency or a county, municipality, or other political subdivision of a state that have been refunded and that, on the
date the governing body of the City adopts or approves the proceedings authorizing the issuance of refunding bonds,
are rated as to investment quality by a nationally recognized investment rating firm not less than “AAA” or its
equivalent.
There is no assurance that the current law will not be changed in a manner which would permit investments
other than those described above to be made with amounts deposited to defease the Bonds. Because the Indenture does
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not contractually limit such investments, Owners may be deemed to have consented to defeasance with such other
investments, notwithstanding the fact that such investments may not be of the same investment quality as those
currently permitted under State law. There is no assurance that the ratings for U.S. Treasury securities used as
Defeasance Securities or that for any other Defeasance Security will be maintained at any particular rating category.
Events of Default
Each of the following occurrences or events constitutes an “Event of Default” under the Indenture:
i. The failure of the City to deposit the Pledged Revenues to the Pledged Revenue Fund;
ii. The failure of the City to enforce the collection of the Improvement Area #1 Assessments, including
the prosecution of foreclosure proceedings;
iii. Default in the performance or observance of any covenant, agreement, or obligation of the City
under the Indenture, other than a default under (iv) below, and the continuation thereof for a period
of ninety (90) days after written notice specifying such default and requiring same to be remedied
shall have been given to the City by the Trustee, which may give notice in its discretion and which
shall give such notice at the written request of the Owners of not less than 51% in aggregate
Outstanding principal amount of the Bonds; provided, however, if the default stated in the notice is
capable of cure but cannot reasonably be cured within the applicable period, the City shall be entitled
to a further extension of time reasonably necessary to remedy such default so long as corrective
action is instituted by the City within the applicable period and is diligently pursued until such
failure is corrected, but in no event for a period of time of more than one hundred eighty (180) days
after such notice; and
iv. The failure to make payment of the principal of or interest on any of the Bonds when the same
becomes due and payable and such failure is not remedied within thirty (30) days thereafter.
The Trustee shall not be charged with knowledge of (a) any events or other information, or (b) any default
under the Indenture or any other agreement unless a responsible officer of the Trustee shall have actual knowledge
thereof.
Remedies in Event of Default
Upon the happening and continuance of any Event of Default, then and in every such case the Trustee may
proceed, and upon the written request of the Owners of not less than fifty-one percent (51%) in aggregate Outstanding
principal amount of the Bonds under the Indenture shall proceed, to protect and enforce the rights of the Owners under
the Indenture by action seeking mandamus or by other suit, action, or special proceeding in equity or at law in any
court of competent jurisdiction for any relief to the extent permitted by Applicable Laws including, but not limited to,
the specific performance of any covenant or agreement contained in the Indenture, or injunction; provided, however,
that no action for money damages against the City may be sought or shall be permitted.
THE PRINCIPAL OF THE BONDS SHALL NOT BE SUBJECT TO ACCELERATION UNDER ANY
CIRCUMSTANCES.
If the assets of the Trust Estate are sufficient to pay all amounts due with respect to all Outstanding Bonds,
in the selection of Trust Estate assets to be used in the payment of Bonds due in an Event of Default, the City shall
determine, in its absolute discretion, and shall instruct the Trustee by City Certificate, which Trust Estate assets shall
be applied to such payment and shall not be liable to any Owner or other Person by reason of such selection and
application. In the event that the City shall fail to deliver to the Trustee such City Certificate, the Trustee shall select
and liquidate or sell Trust Estate assets as provided in the following paragraph, and shall not be liable to any Owner,
or other Person, or the City by reason of such liquidation or sale. The Trustee shall have no liability for its selection
of Trust Estate assets to liquidate or sell.
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Whenever moneys are to be applied in the Event of Default pursuant to the Indenture, irrespective of and
whether other remedies authorized under the Indenture shall have been pursued in whole or in part, the Trustee may
cause any or all of the assets of the Trust Estate, including Investment Securities, to be sold. The Trustee may so sell
the assets of the Trust Estate and all right, title, interest, claim, and demand thereto and the right of redemption thereof,
in one or more parts, at any such place or places, and at such time or times and upon such notice and terms the Trustee
may deem appropriate, and as may be required by law and apply the proceeds thereof in accordance with the provisions
of the Indenture. Upon such sale, the Trustee may make and deliver to the purchaser or purchasers a good and
sufficient assignment or conveyance for the same, which sale shall be a perpetual bar both at law and in equity against
the City, and all other Persons claiming such properties. No purchaser at any sale shall be bound to see to the
application of the purchase money proceeds thereof or to inquire as to the authorization, necessity, expediency, or
regularity of any such sale. Nevertheless, if so requested by the Trustee, the City shall ratify and confirm any sale or
sales by executing and delivering to the Trustee or to such purchaser or purchasers all such instruments as may be
necessary or, or in the reasonable judgment of the Trustee, proper for the purpose which may be designated in such
request.
Restriction on Owner’s Actions
No Owner shall have any right to institute any action, suit, or proceeding at law or in equity for the
enforcement of the Indenture or for the execution of any trust thereof or any other remedy thereunder, unless (i) a
default has occurred and is continuing of which the Trustee has been notified in writing or of which the Trustee is
deemed to have notice, (ii) such default has become an Event of Default and the Owners of not less than 51% in
aggregate principal amount of the Bonds then Outstanding have made written request to the Trustee and offered it
reasonable opportunity either to proceed to exercise the powers granted in the Indenture or to institute such action,
suit, or proceeding in its own name, (iii) the Owners have furnished to the Trustee written evidence of indemnity as
provided in the Indenture, (iv) the Trustee has for sixty (60) days after such notice failed or refused to exercise the
powers granted in the Indenture, or to institute such action, suit, or proceeding in its own name, (v) no written direction
inconsistent with such written request has been given to the Trustee during such 60-day period by the Owners of a
majority of the aggregate principal amount of the Bonds then Outstanding, and (vi) notice of such action, suit, or
proceeding is given to the Trustee in writing; however, no one or more Owners of the Bonds shall have any right in
any manner whatsoever to affect, disturb, or prejudice the Indenture by its, his, or their action or to enforce any right
under the Indenture except in the manner provided in the Indenture, and that all proceedings at law or in equity shall
be instituted and maintained in the manner provided in the Indenture and for the equal benefit of the Owners of all
Bonds then Outstanding. The notification, request, and furnishing of indemnity set forth in the Indenture shall, at the
option of the Trustee as advised by its counsel, be conditions precedent to the execution of the powers and trusts of
the Indenture and to any action or cause of action for the enforcement of the Indenture or for any other remedy under
the Indenture.
Subject to provisions of the Indenture with respect to certain liabilities of the City, nothing in the Indenture
shall affect or impair the right of any Owner to enforce, by action at law, payment of any Bond at and after the maturity
thereof, or on the date fixed for redemption, or the obligation of the City to pay each Bond issued thereunder to the
respective Owners thereof at the time and place, from the source, and in the manner expressed therein and in the
Bonds.
In case the Trustee or any Owners shall have proceeded to enforce any right under the Indenture and such
proceedings shall have been discontinued or abandoned for any reason or shall have been determined adversely to the
Trustee or any Owners, then and in every such case the City, the Trustee, and the Owners shall be restored to their
former positions and rights thereunder, and all rights, remedies, and powers of the Trustee shall continue as if no such
proceedings had been taken.
Application of Revenues and Other Moneys After Event of Default
All moneys, securities, funds, Pledged Revenues, and other assets of the Trust Estate and the income
therefrom received by the Trustee pursuant to any right given or action taken under the provisions of the Indenture
with respect to Events of Default shall, after payment of the cost and expenses of the proceedings resulting in the
collection of such amounts, the expenses (including Trustee’s counsel fees, costs, and expenses), liabilities, and
advances incurred or made by the Trustee, and the fees of the Trustee in carrying out the Indenture, be applied by the
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Trustee, on behalf of the City, to the payment of interest and principal or Redemption Price then due on Bonds, as
follows:
FIRST: To the payment to the Owners entitled thereto all installments of interest then due in the direct order
of maturity of such installments, and, if the amount available shall not be sufficient to pay in full any
installment, then to the payment thereof ratably, according to the amounts due on such installment, to the
Owners entitled thereto, without any discrimination or preference; and
SECOND: To the payment to the Owners entitled thereto of the unpaid principal of Outstanding Bonds, or
Redemption Price of any Bonds which shall have become due, whether at maturity or by call for redemption,
in the direct order of their due dates and, if the amounts available shall not be sufficient to pay in full all the
Bonds due on any date, then to the payment thereof ratably, according to the amounts of principal due or
Redemption Price and to the Owners entitled thereto, without any discrimination or preference.
The Trustee shall make payments to the Owners pursuant to the provisions above within thirty (30) days of
receipt of such good and available funds, and the record date shall be the date the Trustee receives such good and
available funds.
In the event funds are not adequate to cure any of the Events of Default described above, the available funds
shall be allocated to the Bonds that are Outstanding in proportion to the quantity of Bonds that are currently due and
in default under the terms of the Indenture.
The restoration of the City to its prior position after any and all defaults have been cured, as provided above,
shall not extend to or affect any subsequent default under the Indenture or impair any right consequent thereon.
Investment or Deposit of Funds
Money in any Fund or Account established pursuant to the Indenture, other than the Reserve Fund, shall be
invested by the Trustee in Investment Securities as directed by the City pursuant to a City Certificate filed with the
Trustee; provided that all such deposits and investments shall be made in such manner that the money required to be
expended from any Fund or Account will be available at the proper time or times. Money in the Reserve Fund shall
be invested in such Investment Securities as directed by the City pursuant to a City Certificate filed with the Trustee,
provided that the final maturity of any individual Investment Security shall not exceed 270 days and the average
weighted maturity of any investment pool or no-load money market mutual fund shall not exceed 90 days. Each such
City Certificate shall be a certification, upon which the Trustee may conclusively rely without investigation or inquiry,
that the investment directed therein constitutes an Investment Security and that such investments meet the maturity
and average weighted maturity requirements set forth in the preceding sentence. Such investments shall be valued
each year in terms of the Value of Investment Securities as of September 30. For purposes of maximizing investment
returns, to the extent permitted by law, money in the Funds and Accounts may be invested in common investments of
the kind described above, or in a common pool of such investment which shall be kept and held at an official depository
bank, which shall not be deemed to be or constitute a commingling of such money or funds provided that safekeeping
receipts or certificates of participation clearly evidencing the investment or investment pool in which such money is
invested and the share thereof purchased with such money or owned by such Fund or Account are held by or on behalf
of each such Fund or Account. If necessary, such investments shall be promptly sold to prevent any default under the
Indenture. To ensure that cash on hand is invested, if the City does not give the Trustee written or timely instructions
with respect to investments of funds, the Trustee is hereby directed to invest and re-invest cash balances in Morgan
Stanley, Fidelity or Federated family of funds, but only so long as such funds are authorized investments and permitted
under the PFIA, or any successor law, and only so long as such investments constitute Investment Securities and the
money required to be expended from any Fund will be available at the proper time or times
Obligations purchased as an investment of moneys in any Fund or Account shall be deemed to be part of
such Fund or Account, subject, however, to the requirements of the Indenture for transfer of interest earnings and
profits resulting from investment of amounts in Funds and Accounts. Whenever in the Indenture any moneys are
required to be transferred by the City to the Trustee, such transfer may be accomplished by transferring a like amount
of Investment Securities as directed by the City in writing.
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Against Encumbrances
Other than Refunding Bonds, the City shall not create and, to the extent Pledged Revenues are received, shall
not suffer to remain, any lien, encumbrance, or charge upon the Trust Estate or upon any other property pledged under
the Indenture, except the pledge created for the security of the Bonds, and other than a lien or pledge subordinate to
the lien and pledge of such property related to the Bonds.
So long as Bonds are Outstanding under the Indenture, the City shall not issue any bonds, notes, or other
evidences of indebtedness other than the Bonds and any Refunding Bonds, secured by any pledge of or other lien or
charge on the Trust Estate or other property pledged under the Indenture, other than a lien or pledge subordinate to
the lien and pledge of such property related to the Bonds.
Other Obligations or Other Liens; Refunding Bonds
The City reserves the right, subject to the provisions contained in the Indenture, to issue Other Obligations
under other indentures, assessment ordinances, or similar agreements or other obligations which do not constitute or
create a lien on the Trust Estate and are not payable from the Trust Estate, or any portion thereof.
Other than Refunding Bonds, or subordinate lien obligations permitted under the Indenture, the City will not
create or voluntarily permit to be created any debt, lien, or charge on the Trust Estate, or any portion thereof, and will
not do or omit to do or suffer to be done or omit to be done any matter or things whatsoever whereby the lien of the
Indenture or the priority thereof might or could be lost or impaired; provided, however, that the City has reserved the
right to issue bonds or other obligations secured by and payable from the Trust Estate so long as such pledge is
subordinate to the pledge of the Trust Estate securing payment of the Bonds.
Notwithstanding any contrary provision of the Indenture, the City shall not issue additional bonds, notes, or
other obligations under the Indenture, secured by any pledge of or other lien or charge on the Trust Estate or other
property pledged under the Indenture, other than Refunding Bonds and subordinate lien obligations permitted
thereunder. The City reserves the right to issue Refunding Bonds, the proceeds of which would be utilized to refund
all or any portion of the Outstanding Bonds or Outstanding Refunding Bonds and to pay all costs incident to the
Refunding Bonds, as authorized by the laws of the State.
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SOURCES AND USES OF FUNDS
The table that follows summarizes the expected sources and uses of proceeds of the Bonds:*
Sources of Funds:
Principal Amoun
Total Sources
Uses of Funds:
Deposit to Improvement Area #1 Bond Improvement Account of the Pro ect Fun
Deposit to Costs of Issuance Account of the Pro ect Fun
Deposit to Capitalized Interest Account of the Bond Fun
Deposit to Reserve Account of the Reserve Fun
Deposit to Administrative Fun
Underwriter’s Discount (1)
Total Uses
1) Includes Underwriter’s Counsel’s fee.
THE REMAINDER OF THIS PAGE IS LEFT BLANK INTENTIONALLY.
To be updated and completed upon pricing.
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DEBT SERVICE REQUIREMENTS
The following table sets forth the debt service requirements for the Bonds:*
Year Ending
September 30) Principal Interest Total
2026(1)
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
Total
1) Moneys in the Capitalized Interest Account will be used for the payment of the interest due on the Bonds on March 15, 2026 and
September 15, 2026.
THE REMAINDER OF THIS PAGE IS LEFT BLANK INTENTIONALLY.
To be updated and completed upon pricing.
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OVERLAPPING TAXES AND DEBT
Overlapping Taxes and Debt
The land within Improvement Area #1 of the District has been, and is expected to continue to be, subject to
taxes imposed by taxing entities other than the City. Such taxes are payable in addition to the Improvement Area #1
Assessments. The District, including Improvement Area #1, is within the corporate limits of the City. The City, Collin
County, Texas (the “County”), Collin County Community College District, and Anna Independent School District
Anna ISD”) may each levy ad valorem taxes upon land in Improvement Area #1 of the District for payment of debt
incurred by such governmental entities and/or for payment of maintenance and operations expenses. The City has no
control over the level of ad valorem taxes levied by such other taxing authorities. The following table shows the
overlapping ad valorem tax rates currently levied on property located in Improvement Area #1 of the District.
Overlapping Taxes
Taxin Entit
Tax Year 2025
Ad Valorem Tax Rate(1)
The Cit $0.525073
Collin Count 0.149343
Collin Count Communit Colle e Distric 0.081220
Anna Independent School Distric 1.239900
Total Existing Tax Rate 1.995536
Estimated Average Improvement Area #1 Annual Installment of Improvement
Area #1 Assessments in Improvement Area #1 as a tax rate equivalen (2)
0.689390
Estimated Total Tax Rate and Average Improvement Area #1 Annual
Installment in Improvement Area #1 of the District as a tax rate
equivalent(2)
2.684926
1) As reported by the taxing entities. Per $100 in taxable assessed value.
2) Preliminary, subject to change. Derived from information presented in the Service and Assessment Plan. See “ASSESSMENT
PROCEDURES – Assessment Methodology,” and “– Improvement Area #1 Assessment Amounts” and “APPENDIX C – Form
of Service and Assessment Plan. Pursuant to the Development Agreement, the maximum tax rate equivalent for the Improvement
Area #1 Annual Installment may not exceed $0.69 per $100 taxable assessed valuation, without prior written consent of the City.
Sources: Collin Central Appraisal District, the City, and the Administrator.
As noted above, Improvement Area #1 of the District includes territory located in other governmental entities
that may issue or incur debt secured by the levy and collection of ad valorem taxes. Set forth below is an overlapping
debt table showing the outstanding indebtedness payable from ad valorem taxes with respect to property within
Improvement Area #1 of the District and City debt secured by the Improvement Area #1 Assessments.
Overlapping Debt
Taxin or Assessin Entit
Total
Outstanding Debt
as of September 30, 2025
Estimated
Percentage
Applicable(1)
Direct and
Estimated
Overlappin Deb
The City (The Bonds) $ 7,456,000(2) 100.000% $ 7,456,000(2)
The Cit (Ad Valorem Taxes) 261,831,000 0.375% 980,796
Collin Count 982,755,000 0.006% 60,104
Collin Count Communit Colle e Distric 438,250,000 0.007% 29,646
Anna Independent School Distric 444,228,846 0.389% 1,729,980
TOTAL $2,134,520,846 $10,256,526
1) Based on the prospective market value for Improvement Area #1 of the District as shown in the Appraisal (as defined herein) and the Tax
Year 2025 Net Taxable Assessed Valuations for the taxing entities. See “APPRAISAL” and “APPENDIX G – Appraisal.”
2) Assumes the Bonds are issued. Preliminary; subject to change.
Sources: Collin Central Appraisal District, Municipal Advisory Council of Texas and the Appraisal.
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Agricultural Valuation
If land is devoted principally to agricultural use, a landowner can apply for an agricultural valuation on the
property and pay ad valorem taxes based on the land’s agricultural value. If land qualified for an agricultural valuation
but the land use changes to a non-agricultural use, “rollback taxes” are assessed for each of the previous three (3)
years in which the land received the lower agricultural valuation. The rollback tax is the difference between taxes
paid on land’s agricultural value and the taxes that the landowner would have paid if the land had been taxed on a
higher market value plus interest charged for each year from the date on which taxes would have been due.
If land qualified for an agricultural valuation but the land use changes to a non-agricultural use, “rollback
taxes” are assessed for each of the previous five years in which the land received the lower agricultural valuation. The
rollback tax is the difference between taxes paid on land’s agricultural value and the taxes that the landowner would
have paid if the land had been taxed on a higher market value plus interest charged for each year from the date on
which taxes would have been due. If the land use changes to a non-agricultural use on only a portion of a larger tract,
the landowner can fence off the remaining land and maintain the agricultural valuation on the remaining land. In this
scenario, the landowner would only be responsible for rollback taxes on that portion of the land where use changed
and not the entire tract.
The Developer expects that the land within Improvement Area #1 will be removed from agricultural valuation
in 2026. The Developer anticipates paying any rollback taxes due prior to the sale of lots to end-users. The land within
the Remainder Area will remain entitled to valuation for ad valorem tax purposes based upon its agricultural use. In
addition, the Developer entered into a farm lease agreement (the “Farm Lease”) with Paul Lawerence to farm the
property within the District. The Farm Lease term began on February 27, 2023 and automatically renews annually for
any land remaining undeveloped until terminated by either party with 60-day written notice to the other party. The
Farm Lease has terminated with respect to the land within Improvement Area #1. See “BONDHOLDERS’ RISKS –
Agricultural Use Valuation and Redemption Rights.”
Homeowners’ Association Dues
In addition to the taxes and the Improvement Area #1 Assessments described above, the Developer
anticipates that each property owner in Improvement Area #1 of the District will pay a property owner’s association
fee (the “HOA Fee”) to a homeowners’ association created by the Developer (the “HOA”), in the approximate amount
of $600 annually.
ASSESSMENT PROCEDURES
General
Capitalized terms used under this caption and not otherwise defined in the Indenture or this Limited Offering
Memorandum have the meanings assigned to such terms in the Service and Assessment Plan. As required by the PID
Act, when the City determines to defray a portion of the costs of the Improvement Area #1 Authorized Improvements
as defined herein) through Improvement Area #1 Assessments, it must adopt a resolution generally describing the
Improvement Area #1 Authorized Improvements and the land within Improvement Area #1 of the District to be subject
to Improvement Area #1 Assessments to pay the cost therefor.
The City has caused the Improvement Area #1 Assessment Roll to be prepared, which shows the land within
Improvement Area #1 of the District to be assessed, the amount of the benefit to and the Improvement Area #1
Assessment against each lot or parcel of land, and the number of Improvement Area #1 Annual Installments in which
the Improvement Area #1 Assessment is divided. The Improvement Area #1 Assessment Roll has been or will be
filed with the City Secretary and made available for public inspection. Statutory notice has been or will be given to
the owners of the property to be assessed and a public hearing will be conducted to hear testimony from affected
property owners as to the propriety and advisability of undertaking the Improvement Area #1 Authorized
Improvements and funding a portion of the same with Improvement Area #1 Assessments. The City expects to levy
the Improvement Area #1 Assessments and adopt the Assessment Ordinance on November 17, 2025. After adoption
of the Assessment Ordinance, the Improvement Area #1 Assessments will become legal, valid, and binding liens upon
the Improvement Area #1 Assessed Property.
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Under the PID Act, the costs of the Improvement Area #1 Authorized Improvements may be assessed by the
City against the Improvement Area #1 Assessed Property so long as the special benefit conferred upon the
Improvement Area #1 Assessed Property by the Improvement Area #1 Authorized Improvements equals or exceeds
the Improvement Area #1 Assessments. The costs of the Improvement Area #1 Authorized Improvements may be
assessed using any methodology that results in the imposition of equal shares of cost on Improvement Area #1
Assessed Property similarly benefited. The allocation of benefits and assessments to the benefitted land within the
District, including land in Improvement Area #1, is set forth in the Service and Assessment Plan, which should be
read in its entirety. See “APPENDIX C – Form of Service and Assessment Plan.”
Assessment Methodology
The Service and Assessment Plan describes the special benefit to be received by each parcel of Improvement
Area #1 Assessed Property as a result of the Improvement Area #1 Authorized Improvements, provides the basis and
justification for the determination that such special benefit exceeds the Improvement Area #1 Assessments being
levied, and establishes the methodology by which the City allocates the special benefit of the Improvement Area #1
Authorized Improvements to parcels of Improvement Area #1 Assessed Property in a manner that results in equal
shares of costs being apportioned to parcels of Improvement Area #1 Assessed Property similarly benefited. As
described in the Service and Assessment Plan, a portion of the costs of the Improvement Area #1 Authorized
Improvements are being funded with proceeds of the Bonds, which are payable from Pledged Revenues, including
primarily the Improvement Area #1 Assessments. As set forth in the Service and Assessment Plan, the City Council
has determined that the costs of the Major Improvements shall be allocated to Improvement Area #1 and apportioned
to the Remainder Area based upon Estimated Buildout Value of each Parcel or assessed property to the Estimated
Buildout Value of the District. Currently, the Remainder Area is allocated 83.87% of the Major Improvements costs,
and Improvement Area #1 is allocated 16.13% of the Major Improvements costs. The costs of the Improvement Area
1 Authorized Improvements are allocated to each Parcel within Improvement Area #1 based on the ratio of the
Estimated Buildout Value of each Parcel designated as Improvement Area #1 Assessed Property to the Estimated
Buildout Value of all Improvement Area #1 Assessed Property. The Improvement Area #1 Initial Parcel is the only
Parcel within Improvement Area #1, and as such, the Improvement Area #1 Initial Parcel will be allocated 100% of
the Improvement Area #1 Authorized Improvements.
The City has determined that the foregoing method of allocation will result in the imposition of equal shares
of the Improvement Area #1 Assessments on parcels of Improvement Area #1 Assessed Property similarly situated
within Improvement Area #1 of the District. The Improvement Area #1 Assessments and interest thereon are expected
to be paid in Improvement Area #1 Annual Installments as described above. The determination by the City of the
assessment methodology set forth in the Service and Assessment Plan is the result of the discretionary exercise by the
City Council of its legislative authority and governmental powers and is conclusive and binding on the Developer and
all future owners and developers within Improvement Area #1 of the District. For further explanation of the
Improvement Area #1 Assessment methodology, see “APPENDIX C – Form of Service and Assessment Plan.”
THE REMAINDER OF THIS PAGE IS LEFT BLANK INTENTIONALLY.
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The following table provides additional analysis with respect to assessment methodology, including the value
to Improvement Area #1 Assessment burden ratio per Lot Type, equivalent tax rate per Lot Type, and leverage per
Lot Type related to the Improvement Area #1 Assessments. See “APPENDIX C – Form of Service and Assessment
Plan.”
Value to Lien Analysis, Improvement Area #1 Assessment Allocation, Equivalent Tax Rate,
and Leverage per Lot Type in Improvement Area #1(1)
Lot
T e
Planned
No. of
Lots(2)
Estimated
Finished
Lot
Value(3)
Projected
Average
Home
Value(4)
Maximum
Improvement
Area #1
Assessment(5)
Average
Improvement
Area #1
Annual
Installment
Tax Rate
Equivalent of
Average
Improvement
Area #1 Annual
Installment(6)
Ratio of
Estimated
Finished Lot
Value to
Improvement
Area #1
Assessment
Ratio of
Projected
Average Home
Value to
Improvement
Area #1
Assessment
50’ 123 $ 92,254 $500,000 $41,285 $3,446.95 $0.68939 2.23 : 1 12.11 : 1
60’ 48 108,890 600,000 49,542 4,136.24 0.68939 2.20 : 1 12.11 : 1
1) The information in the table was obtained from and calculated using information provided in the Service and Assessment Plan. Preliminary,
subject to change.
2) Based on the concept plan for the District
3) Derived from information in the Service and Assessment Plan based on the Appraisal. Estimates finished lot values provided by the Developer
and shown in “THE DEVELOPMENT – Development Plan – Lot Prices and Expected Average Home Prices in the District” may differ from such
values.
4) Developer estimates.
5) Pursuant to the Service and Assessment Plan, the maximum Improvement Area #1 Assessment (the “Maximum Assessment”) that can be levied
on a Lot within Improvement Area #1 is equal to the lesser of (1) the amount calculated pursuant to Section VI.A of the Service and Assessment
Plan, or (2) for each Lot Type, the amount shown on Exhibit E of the Service and Assessment Plan, as shown in this table. Numbers are rounded to
the nearest whole number, as shown in the Service and Assessment Plan.
6) Per $100 of home value. Pursuant to the Development Agreement, the maximum tax rate equivalent for the Improvement Area #1 Annual
Installment may not exceed $0.69 per $100 taxable assessed valuation, without prior written consent of the City.
Collection and Enforcement of Improvement Area #1 Assessment Amounts
Under the PID Act, the Improvement Area #1 Annual Installments may be collected in the same manner and
at the same time as ad valorem taxes of the City. The Improvement Area #1 Assessments may be enforced by the
City in the same manner that an ad valorem tax lien against real property is enforced. Delinquent installments of the
Improvement Area #1 Assessments incur interest, penalties, and attorney’s fees in the same manner as delinquent ad
valorem taxes. Under the PID Act, the Assessment Lien is a first and prior lien against the property assessed, superior
to all other liens and claims except liens or claims for State, county, school district, or municipality ad valorem taxes.
See “BONDHOLDERS’ RISKS – Assessment Limitations.”
In the Indenture, the City will covenant to collect, or cause to be collected, Improvement Area #1
Assessments as provided in the Assessment Ordinance. No less frequently than annually, City staff or a designee of
the City shall prepare, and the City Council shall approve, an Annual Service Plan Update to allow for the billing and
collection of Improvement Area #1 Annual Installments. Each Annual Service Plan Update shall include an updated
Improvement Area #1 Assessment Roll and a calculation of the Improvement Area #1 Annual Installment for each
Parcel. Annual Collection Costs shall be allocated among all Parcels in proportion to the amount of the Improvement
Area #1 Annual Installments for the Parcels.
In the Indenture, the City will covenant, agree, and warrant that, for so long as any Bonds are Outstanding it
will take and pursue all actions permissible under Applicable Laws to cause the Improvement Area #1 Assessments
to be collected and the liens thereof enforced continuously, in the manner and to the maximum extent permitted by
Applicable Laws, and, to the extent permitted by Applicable Laws, to cause no reduction, abatement, or exemption in
the Improvement Area #1 Assessments.
To the extent permitted by law, notice of the Improvement Area #1 Annual Installments will be sent by, or
on behalf of the City, to the affected property owners on the same statement or such other mechanism that is used by
the City, so that such Improvement Area #1 Annual Installments are collected simultaneously with ad valorem taxes
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and shall be subject to the same penalties, procedures, and foreclosure sale in case of delinquencies as are provided
for ad valorem taxes of the City.
The City will determine or cause to be determined, no later than February 15 of each year, whether or not
any Improvement Area #1 Annual Installment is delinquent and, if such delinquencies exist, the City will order and
cause to be commenced as soon as practicable any and all appropriate and legally permissible actions to obtain such
Improvement Area #1 Annual Installment, and any delinquent charges and interest thereon, including diligently
prosecuting an action in district court to foreclose the currently delinquent Improvement Area #1 Annual Installment.
Notwithstanding the foregoing, the City shall not be required under any circumstances to purchase or make payment
for the purchase of the delinquent Improvement Area #1 Assessment or the corresponding Improvement Area #1
Assessed Property.
The City expects to implement the basic timeline and procedures for Improvement Area #1 Assessment
collections and pursuit of delinquencies set forth in Exhibit D to the Disclosure Agreement of Issuer set forth in
APPENDIX E-1 and to comply therewith to the extent that the City reasonably determines that such compliance is
the most appropriate timeline and procedures for enforcing the payment of delinquent Improvement Area #1
Assessments.
The City shall not be required under any circumstances to expend any funds for Delinquent Collection Costs
in connection with its covenants and agreements under the Indenture or otherwise other than funds on deposit in the
Administrative Fund.
Improvement Area #1 Annual Installments will be paid to the City or its agent. Improvement Area #1 Annual
Installments are due when billed each year and become delinquent on February 1 of the following year. In the event
Improvement Area #1 Assessments are not timely paid, there are penalties and interest as set forth below:
Date Payment
Receive
Cumulative
Penalt
Cumulative
Interes Total
Februar 6% 1% 7%
March 7% 2% 9%
April 8% 3% 11%
Ma 9% 4% 13%
June 10% 5% 15%
Jul 12% 6% 18%
After July, the penalty remains at 12%, and interest accrues at the rate of 1% each month. In addition, if an
account is delinquent in July, a 20% attorney’s collection fee may be added to the total penalty and interest charge.
In general, property subject to lien may be sold, in whole or in parcels, pursuant to court order to collect the amounts
due. An automatic stay by creditors or other entities, including governmental units, could prevent governmental units
from foreclosing on property and prevents liens for post-petition taxes from attaching to property and obtaining
secured creditor status unless, in either case, an order lifting the stay is obtained from the bankruptcy court. In most
cases, post-petition Improvement Area #1 Assessments are paid as an administrative expense of the estate in
bankruptcy or by order of the bankruptcy court.
Improvement Area #1 Assessment Amounts
Improvement Area #1 Assessment Amounts. The Maximum Assessments have been established by the
methodology described in the Service and Assessment Plan. The Improvement Area #1 Assessment Roll sets forth
for each year the Improvement Area #1 Annual Installment for each Improvement Area #1 Assessed Property
consisting of (i) the annual portion allocable to principal and interest on the Improvement Area #1 Assessment, (ii)
the Additional Interest, and (iii) the annual payment allocable to Annual Collection Costs. The Improvement Area #1
Annual Installments for the Improvement Area #1 Assessments may not exceed the amounts shown on the
Improvement Area #1 Assessment Roll. The Improvement Area #1 Assessments will be levied against the parcels
comprising the Improvement Area #1 Assessed Property as indicated on the Improvement Area #1 Assessment Roll.
See “APPENDIX C – Form of Service and Assessment Plan.”
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The Improvement Area #1 Annual Installments shown on the Improvement Area #1 Assessment Roll will be
reduced to equal the actual costs of repaying the Bonds (which amount will include Additional Interest) and actual
Annual Collection Costs (as provided for in the definition of such term), taking into consideration any other available
funds for these costs, such as interest income on account balances.
Method of Apportionment of Improvement Area #1 Assessments. For purposes of the Service and Assessment
Plan, the City Council has determined that the Improvement Area #1 Assessments shall be initially allocated to the
Parcels consisting of the Improvement Area #1 Assessed Property, which currently consists of the Improvement Area
1 Initial Parcel.
Upon Division Prior to Recording of Subdivision Plat. Upon the division of any Improvement Area
1 Assessed Property prior to the recording of a subdivision plat, the Administrator shall reallocate the
Improvement Area #1 Assessment for the Improvement Area #1 Assessed Property prior to the division
among the newly divided Improvement Area #1 Assessed Properties according to the following formula:
A = B x (C ÷ D) Where
the terms have the following meanings: A =
the Improvement Area #1 Assessment for the newly divided Improvement Area #1 Assessed Property
B =
the Improvement Area #1 Assessment for the Improvement Area #1 Assessed Property prior to division
C =
the Estimated Buildout Value of the newly divided Improvement Area #1 Assessed Property D =
the sum of the Estimated Buildout Value for all of the newly divided Improvement Area #1 Assessed
Properties The
calculation of the Improvement Area #1 Assessment of an Improvement Area #1 Assessed Property
shall be performed by the Administrator and shall be based on the Estimated Buildout Value of that Improvement
Area #1 Assessed Property, as relying on information from homebuilders, market studies, appraisals,
official public records of the County, and any other relevant information regarding the Improvement
Area #1 Assessed Property. The calculation as confirmed by the City Council shall be conclusive
and binding. The
sum of the Improvement Area #1 Assessments for all newly divided Improvement Area #1 Assessed
Properties shall equal the Improvement Area #1 Assessment for the Improvement Area #1 Assessed Property
prior to subdivision. The calculation shall be made separately for each newly divided Improvement Area #
1 Assessed Property. The reallocation of an Improvement Area #1 Assessment for an Improvement Area #
1 Assessed Property that is a homestead under Texas law may not exceed the Improvement Area #1 Assessment
prior to the reallocation. Any reallocation shall be reflected in the next Annual Service Plan Update
immediately following such reallocation Upon
Subdivision by a Recorded Subdivision Plat. Upon the subdivision of any Improvement Area 1
Assessed Property based on a recorded subdivision plat, the Administrator shall reallocate the Improvement
Area #1 Assessment for the Improvement Area #1 Assessed Property prior to the subdivision among
the new subdivided Lots based on Estimated Buildout Value according to the following formula: A = [
B x (C ÷ D)]/E Where the
terms have the following meanings: A = the
Improvement Area #1 Assessment for the newly subdivided Lot B = the
Improvement Area #1 Assessment for the Parcel prior to subdivision C = the
sum of the Estimated Buildout Value of all newly subdivided Lots of the same Lot Type
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D = the sum of the Estimated Buildout Value for all of the newly subdivided Lots excluding
Non-Benefitted Property
E= the number of newly subdivided Lots of the same Lot Type
Prior to the recording of a subdivision plat, the Developer shall provide the City an Estimated
Buildout Value for each Lot to be created after recording the subdivision plat as of the date the subdivision
plat is anticipated to be recorded. The calculation of the Improvement Area #1 Assessment for a Lot shall
be performed by the Administrator and confirmed by the City Council based on Estimated Buildout Value
information provided by the Developer, homebuilders, third party consultants, and/or the official public
records of the County regarding the Lot. The calculation as confirmed by the City Council shall be conclusive
and binding.
The sum of the Improvement Area #1 Assessments for all newly subdivided Lots shall not exceed
the Improvement Area #1 Assessment for the portion of the Improvement Area #1 Assessed Property
subdivided prior to subdivision. The calculation shall be made separately for each newly subdivided
Improvement Area #1 Assessed Property. The reallocation of an Improvement Area #1 Assessment for an
Improvement Area #1 Assessed Property that is a homestead under Texas law may not exceed the
Improvement Area #1 Assessment prior to the reallocation. Any reallocation pursuant to this section shall be
reflected in the next Annual Service Plan Update immediately following such reallocation.
Upon Consolidation. If two or more Lots or Parcels are consolidated into a single Parcel or Lot,
the Administrator shall allocate the Improvement Area #1 Assessments against the Lots or Parcels before the
consolidation to the consolidated Lot or Parcel, which allocation shall be approved by the City Council in
the next Annual Service Plan Update immediately following such consolidation. The Improvement Area #1
Assessment for any resulting Lot may not exceed the Maximum Assessment for the applicable Lot Type and
compliance may require a mandatory prepayment of Improvement Area #1 Assessments.
Reduction of Assessments. If, as a result of cost savings or the failure to construct all or a portion of an
Improvement Area #1 Project, the Actual Costs of any Improvement Area #1 Projects are less than the Improvement
Area #1 Assessments, the Trustee shall apply amounts on deposit in the Project Fund that are not expected to be used
for purposes of the Project Fund to redeem outstanding Bonds. Excess Bond proceeds shall be applied to redeem
outstanding Bonds. See “SECURITY FOR THE BONDS – Project Fund.”
Prepayment of Improvement Area #1 Assessments
Voluntary Prepayments. Pursuant to the PID Act and the Indenture, the owner of any Assessed Property may
voluntarily prepay (a “Prepayment”) all or part of any Improvement Area #1 Assessment levied against any Lot or
Parcel, together with accrued interest to the date of payment, at any time. Upon receipt of such Prepayment, such
amounts will be applied towards the redemption or payment of the Bonds. Amounts received at the time of a
Prepayment which represent a payment of principal, interest, or penalties on a delinquent installment of an
Improvement Area #1 Assessment are not to be considered a Prepayment, but rather are to be treated as payment of
regularly scheduled Improvement Area #1 Assessments.
Mandatory Prepayment. If an Improvement Area #1 Assessed Property or a portion thereof is conveyed to a
party that is exempt from payment of the Improvement Area #1 Assessment under applicable law, or the owner causes
a Lot, Parcel or portion thereof to become Non-Benefitted Property, the owner of such Lot, Parcel or portion thereof
shall pay to the City, or cause to be paid to the City, the full amount of the Improvement Area #1 Assessment, plus all
Prepayment Costs and Delinquent Collection Costs for such Improvement Area #1 Assessed Property, prior to any
such conveyance or act, and no such conveyance shall be effective until the City receives such payment.
True-Up of Improvement Area #1 Assessments if Maximum Assessment Exceeded at Plat. Prior to the City
approving a final subdivision plat, the Administrator will certify that such plat will not result in the Assessment per
Lot for any Lot Type to exceed the Maximum Assessment. If the Administrator determines that the resulting
Improvement Area #1 Assessment per Lot for any Lot Type will exceed the Maximum Assessment for that Lot Type,
then (1) the Improvement Area #1 Assessment applicable to each Lot Type shall each be reduced to the Maximum
Assessment, and (2) the person or entity filing the plat shall pay to the City, or cause to be paid to the City, the amount
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the Improvement Area #1 Assessment was reduced, plus Prepayment Costs and Delinquent Collection Costs, if any,
prior to the City approving the final plat. The City’s approval of a plat without payment of such amounts does not
eliminate the obligation of the person or entity filing the plat to pay such amounts. At no time shall the aggregate
Improvement Area #1 Assessments for any Lot exceed the Maximum Assessment. See “ASSESSMENT
PROCEDURES – Assessment Methodology – Value to Lien Analysis, Improvement Area #1 Assessment Allocation,
Equivalent Tax Rate, and Leverage per Lot Type in Improvement Area #1.”
Prepayment as a Result of an Eminent Domain Proceeding or Taking. Subject to applicable law, if any
portion of any Parcel of Improvement Area #1 Assessed Property is taken from an owner as a result of eminent domain
proceedings or if a transfer of any portion of any Parcel of Improvement Area #1 Assessed Property is made to an
entity with the authority to condemn all or a portion of the Improvement Area #1 Assessed Property in lieu of or as a
part of an eminent domain proceeding (a “Taking”), the portion of the Improvement Area #1 Assessed Property that
was taken or transferred (the “Taken Property”) shall be reclassified as Non-Benefitted Property.
For the Improvement Area #1 Assessed Property that is subject to the Taking as described in the preceding
paragraph, the Improvement Area #1 Assessment that was levied against the Improvement Area #1 Assessed Property
when it was included in the Taken Property) prior to the Taking shall remain in force against the remaining
Improvement Area #1 Assessed Property (the Improvement Area #1 Assessed Property less the Taken Property) (the
Remaining Property”), following the reclassification of the Taken Property as Non-Benefitted Property, subject to
an adjustment of the Improvement Area #1 Assessment applicable to the Remaining Property after any required
Prepayment as set forth below. The owner of the Remaining Property will remain liable to pay, pursuant to the terms
of the Service and Assessment Plan, as updated, and the PID Act, the Improvement Area #1 Assessment that remains
due on the Remaining Property, subject to an adjustment in the Improvement Area #1 Assessment applicable to the
Remaining Property after any required Prepayment as set forth below. Notwithstanding the foregoing, if the
Improvement Area #1 Assessment that remains due on the Remaining Property exceeds the applicable Maximum
Assessment, the owner of the Remaining Property will be required to make a Prepayment in an amount necessary to
ensure that the Improvement Area #1 Assessment against the Remaining Property does not exceed such Maximum
Assessment, in which case the Improvement Area #1 Assessment applicable to the Remaining Property will be reduced
by the amount of the partial Prepayment. If the City receives all or a portion of the eminent domain proceeds (or
payment made in an agreed sale in lieu of condemnation), such amount shall be credited against the amount of
Prepayment, with any remainder credited against the Improvement Area #1 Assessment on the Remaining Property.
In all instances the Improvement Area #1 Assessment remaining on the Remaining Property shall not exceed
the applicable Maximum Assessment.
Notwithstanding the previous paragraphs in this subsection, if the owner of the Remaining Property notifies
the City and the Administrator that the Taking prevents the Remaining Property from being developed for any use
which could support the Estimated Buildout Value requirement, the owner shall, upon receipt of the compensation for
the Taken Property, be required to prepay the amount of the Improvement Area #1 Assessment required to buy down
the outstanding Improvement Area #1 Assessment to the applicable Maximum Assessment on the Remaining Property
to support the Estimated Buildout Value requirement. The owner will remain liable to pay the Improvement Area #1
Assessment on both the Taken Property and the Remaining Property until such time that such Improvement Area #1
Assessment has been prepaid in full.
Notwithstanding the previous paragraphs in this subsection, the Improvement Area #1 Assessments shall
never be reduced to an amount less than the amount required to pay all outstanding debt service requirements on all
outstanding Bonds.
Priority of Lien
The Improvement Area #1 Assessments or any reassessment, the expense of collection, and reasonable
attorney’s fees, if incurred, constitute a first and prior lien against the property assessed, superior to all other liens and
claims except liens or claims for the State, county, school district, or municipality ad valorem taxes, and are a personal
liability of and charge against the owners of the property regardless of whether the owners are named. The lien is
effective from the date of the Assessment Ordinance until the Improvement Area #1 Assessment is paid, and may be
enforced by the City in the same manner as an ad valorem tax levied against real property may be enforced by the
33
City. The owner of any property assessed may pay the entire Improvement Area #1 Assessment levied against any
lot or parcel, together with accrued interest to the date of payment, at any time.
Foreclosure Proceedings
In the event of delinquency in the payment of any Improvement Area #1 Annual Installment, except for
unpaid Improvement Area #1 Assessments on homestead property (unless the lien associated with the assessment
attached prior to the date the property became a homestead), the City is empowered to order institution of an action in
state district court to foreclose the lien of such delinquent Improvement Area #1 Annual Installment. In such action
the real property subject to the delinquent Improvement Area #1 Annual Installments may be sold at judicial
foreclosure sale for the amount of such delinquent Improvement Area #1 Annual Installments, plus penalties and
interest.
Any sale of property for nonpayment of an installment or installments of an Improvement Area #1
Assessment will be subject to the lien established for remaining unpaid installments of the Improvement Area #1
Assessment against such property and such property may again be sold at a judicial foreclosure sale if the purchaser
thereof fails to make timely payment of the non-delinquent installments of the Improvement Area #1 Assessments
against such property as they become due and payable. Judicial foreclosure proceedings are not mandatory. In the
event a foreclosure is necessary, there could be a delay in payments to owners of the Bonds pending prosecution of
the foreclosure proceedings and receipt by the City of the proceeds of the foreclosure sale. It is possible that no bid
would be received at the foreclosure sale, and in such event there could be an additional delay in payment of the
principal of and interest on Bonds or such payment may not be made in full. The City is not required under any
circumstance to purchase the property or to pay the delinquent Improvement Area #1 Assessment on the corresponding
Improvement Area #1 Assessed Property.
In the Indenture, the City will covenant to take and pursue all actions permissible under Applicable Laws to
cause the Improvement Area #1 Assessments to be collected and the liens thereof enforced continuously, in the manner
and to the maximum extent permitted by Applicable Laws, and to cause no reduction, abatement, or exemption in the
Improvement Area #1 Assessments, provided that the City is not required to expend any funds for collection and
enforcement of Improvement Area #1 Assessments other than funds on deposit in the Administrative Fund. Pursuant
to the Indenture, Foreclosure Proceeds (excluding Delinquent Collection Costs) constitute Pledged Revenues to be
deposited into the Pledged Revenue Fund upon receipt by the City and distributed in accordance with the Indenture.
See “APPENDIX B – Form of Indenture.” See also “APPENDIX E-1 – Form of Disclosure Agreement of Issuer” for
a description of the expected timing of certain events with respect to collection of the delinquent Improvement Area
1 Assessments.
In the Indenture, the City creates the Delinquency and Prepayment Reserve Account under the Reserve Fund
and will fund such account as provided in the Indenture. The City will not be obligated to fund foreclosure proceedings
out of any funds other than in the Administrative Fund. If funds in the Administrative Fund are insufficient to pay
foreclosure costs, the owners of the Bonds may be required to pay amounts necessary to continue foreclosure
proceedings. See “SECURITY FOR THE BONDS – Reserve Fund (Reserve Account and Delinquency and
Prepayment Reserve Account),” “APPENDIX B – Form of Indenture,” and “APPENDIX C – Form of Service and
Assessment Plan.”
THE CITY
Background
The City located in north Collin County, 40 miles north of Dallas and 12 miles northwest of the City of
McKinney. Access to the City is provided by State Highway 121, State Highway 5, US-75, and Farm Road 455. The
City covers approximately 16 square miles. Some of the services that the City provides are public safety (police and
fire protection), streets, water and sanitary sewer utilities, planning and zoning, and general administrative services.
The 2020 Census population for the City was 16,896, and the current estimated population is 32,000.
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City Government
The City is a political subdivision and municipal corporation of the State, duly organized and existing under
the laws of the State, including the City's Home Rule Charter. The City was incorporated in 1913, and first adopted
its Home Rule Charter on May 7, 2005. The City operates under a Council/Manager form of government with a City
Council comprised of the Mayor and six Councilmembers elected for staggered three-year terms. The City Manager
is the Chief Administrative Officer for the City.
The current members of the City Council and principal administrators of the City are listed on page ii hereof.
For more information regarding the City and surrounding areas, see “APPENDIX A – General Information
Regarding the City and Surrounding Areas.”
Water and Wastewater
The City will provide both water and wastewater service to the District. The City’s existing water and
wastewater systems are sufficient to serve all of the property in Improvement Area #1 of the District.
The City is currently served by ground water, through nine water wells located at five different sites. The
well systems can produce a total of 3.4 million gallons per day. The City has a total elevated storage capacity of
1,500,000 gallons of water and five ground storage tanks with total storage capacity of 4,000,000 gallons.
In partnership with the Cities of Melissa, Van Alstyne, and Howe, the City is connected to a large diameter
water transmission line managed by the Greater Texoma Utility Authority (“GTUA”). The GTUA line provides a
connection to the North Texas Municipal Water District’s (“NTMWD”) water distribution system, providing the City
with access to treated surface water. This surface water line is part of the City’s long term water supply plan. Currently
the City has a maximum allowable take of 5,040 gpm from the GTUA connection, providing the City with a maximum
peak flow of treated water supply at 6,706 gpm. Both GTUA and the City continue to work on capital projects which
will increase the maximum treated water supply and storage. GTUA expanded their Bloomdale Pump Station vault,
which increased the GTUA total maximum flow to over 9,000 gpm. The City has completed an expansion of the
Collin Pump Station site, which brought the existing 1-million-gallon ground storage tank and new pumps online with
adjacent wells to maximize storage and flow. The City is currently constructing a 4-million-gallon ground storage
tank at the Collin Pump Station site to further increase storage capacity. Additional water system expansion projects
are identified in the City of Anna’s Capital Improvement Plan (“CIP”), and in the GTUA/CGMA CIP, which are both
being updated this year.
The City’s sanitary sewer system consists of seven lift stations and one wastewater treatment facility at the
John R. Geren (Slayter Creek) Wastewater Treatment Plant. In addition, the City has two large diameter sewer
transmission lines that transport wastewater directly into the NTMWD’s wastewater system to the South (Wilson
Creek plant). The City’s wastewater treatment facility is located on Slayter Creek, just north of the confluence of
Slayter Creek and Throckmorton Creek. The total treatment capacity of the City’s facility is approximately 0.50
million gallons per day. A portion of the NTMWD regional sewer is located along Throckmorton Creek, in the south-
central part of the City and the other is located near Clemmons Creek in the southeastern part of the City. The City’s
wastewater treatment plant is currently near capacity. The transmission lines will soon near capacity. The City
completed the Slayter Creek Interceptor Sewer project which now conveys wastewater flows in excess of the Slayter
Creek Wastewater Treatment capacity to the NTMWD regional wastewater system. The City issued certificates of
obligation in 2024, which are being used for the construction of a new Hurricane Creek Regional Wastewater
Treatment Plant, which will significantly expand the City’s ability to collect and treat wastewater as required for new
development west of US 75. The temporary treatment plant has been operational since March 2025 and can treat up
to 0.5 million gallons per day while the remaining phases are finished. The full first phase of the new plant will have
a capacity to treat 2 million gallons per day of wastewater, with plans to gradually expand the plant’s capacity up to
16 million gallons per day. The City will utilize the new plant to treat sewage for its own residents, as well as provide
wholesale sewage treatment for the City of Van Alstyne, the City of Weston, and for various water districts located in
the area. A large diameter trunk sewer is complete and in place from FM 455 to the Hurricane Creek Wastewater
Treatment Plant. The City issued certificates of obligation earlier this year, which will be used to construct additional
35
segments of the trunk line further to the north, from FM 455 to the northern City limit. This will allow new
developments in Anna and Van Alstyne to flow sewer to the new treatment plant.
THE DISTRICT
General
The PID Act authorizes municipalities, such as the City, to create public improvement districts within their
boundaries or extraterritorial jurisdiction, and to impose assessments within the public improvement district to pay for
certain improvements. The District was created by resolution of the City adopted on February 25, 2025 (the “Creation
Resolution”), for the purpose of undertaking and financing the cost of certain public improvements within the District,
including the Improvement Area #1 Projects, authorized by the PID Act and approved by the City Council that confer
a special benefit on the District property being developed. The District is not a separate political subdivision of the
State and is governed by the City Council. A map of the property within the District is included on page v hereof.
Powers and Authority
Pursuant to the PID Act, the City may establish and create the District and undertake, or reimburse a
developer for the costs of, improvement projects that confer a special benefit on property located within the District,
whether located within the City limits or the City’s extraterritorial jurisdiction. The PID Act provides that the City
may levy and collect assessments on property in the District, or portions thereof, payable in periodic installments
based on the benefit conferred by an improvement project to pay all or part of its cost.
Pursuant to the PID Act and the Creation Resolution, the City has the power to undertake, or reimburse a
developer for the costs of, the financing, acquisition, construction, or improvement of the Improvement Area #1
Projects. See “THE IMPROVEMENT AREA #1 AUTHORIZED IMPROVEMENTS.” Pursuant to the authority
granted by the PID Act and the Creation Resolution, the City has determined to undertake the construction, acquisition,
or purchase of certain road, water, sanitary sewer, and storm drainage improvements benefitting Improvement Area
1 of the District comprising the Improvement Area #1 Projects and to finance a portion of the costs thereof through
the issuance of the Bonds. The City has further determined to provide for the payment of debt service on the Bonds
through Pledged Revenues and other assets comprising the Trust Estate. See “ASSESSMENT PROCEDURES” and
APPENDIX C – Form of Service and Assessment Plan.”
THE IMPROVEMENT AREA #1 AUTHORIZED IMPROVEMENTS
General
The “Improvement Area #1 Authorized Improvements” consist of (1) the Improvement Area #1 Projects,
which include the Improvement Area #1 Improvements and Improvement Area #1’s allocable share of the Major
Improvements, (2) the deposit to Administrative Fund related to the Bonds, and (3) the Bond Issuance Costs (described
below) incurred in connection with the issuance of the Bonds.
A portion of the costs the Improvement Area #1 Authorized Improvements will be funded with proceeds of
the Bonds. The balance of the costs of the Improvement Area #1 Authorized Improvements will be paid by the
Developer under the terms of the CFA Agreement and the Service and Assessment Plan without reimbursement by
the City. See “APPENDIX C – Form of Service and Assessment Plan.”
Major Improvements
Paving/Roads/Streets. Improvements including subgrade stabilization, reinforced concrete for
roadways, headers, barricades, signs, striping, and traffic control. All related earthwork, excavation, clearing
and grubbing, erosion control, intersections, signage, lighting, and re-vegetation of all disturbed areas within
the right-of-way are included. The road improvements will provide benefit to each Lot within the District.
Water. Improvements including trench excavation and embedment, trench safety, PVC piping,
water main connections, water meters, testing, related earthwork, excavation, erosion control, fire hydrants,
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platting, staking, and all necessary appurtenances required to provide water service to all Lots within the
District.
Sanitary Sewer. Improvements including trench excavation and embedment, trench safety, PVC
piping, encasement, manholes, sewer main connections, service connections, testing, related earthwork,
excavation, erosion control, platting, staking, and all necessary appurtenances required to provide wastewater
service to all Lots within the District.
Storm Drainage. Improvements including trench excavation and embedment, RCP piping, curb
and drop inlets, headwalls, wingwalls, manholes, rock rip rap, and trench safety as well as all related
earthwork, excavation, erosion control, platting, staking, and all necessary appurtenances required to provide
storm drainage for all Lots within the District.
Soft Costs. Costs related to designing, constructing, and installing the Major Improvements
including inspection fees, City fees, bonds, engineering, soil testing, survey, construction management,
contingency, legal fees, and consultants.
Improvement Area #1 Improvements
Paving/Roads/Streets. Improvements including subgrade stabilization, reinforced concrete for
roadways, handicapped ramps, sidewalks, pavement connections, headers, barricades, CBU pads, signs,
platting, staking, and streetlights. All related earthwork, excavation, clearing and grubbing, tree removal,
erosion control, intersections, signage, lighting, screening walls, and re-vegetation of all disturbed areas
within the right-of-way are included. The road improvements will provide benefit to each Lot within
Improvement Area #1.
Water. Improvements including trench excavation and embedment, trench safety, PVC piping,
water main connections, water meters, service connections, testing, related earthwork, excavation, erosion
control, fire hydrants, platting, staking, and all necessary appurtenances required to provide water service to
all Lots within Improvement Area #1.
Sanitary Sewer. Improvements including trench excavation and embedment, trench safety, PVC
piping, encasement, boring, manholes, sewer main connections, service connections, testing, related
earthwork, excavation, erosion control, platting, staking, and all necessary appurtenances required to provide
wastewater service to all Lots within Improvement Area #1.
Storm Drainage. Improvements including trench excavation and embedment, curb and drop inlets,
RCP and RCB piping and boxes, headwalls, manholes, rock rip rap, concrete outfalls, storm drain
connections, trench safety, and testing as well as all related earthwork, excavation, erosion control,
encasement, platting, staking, and all necessary appurtenances required to provide storm drainage for all Lots
within Improvement Area #1.
Soft Costs. Costs related to designing, constructing, and installing the Improvement Area #1
Improvements including land planning and design, erosion control, inspection fees, City fees, bonds,
engineering, soil testing, survey, construction management, contingency, legal fees, and consultants.
Bond Issuance Costs
Debt Service Reserve Fund. Equals the amount to be deposited in the Reserve Account under the
Indenture in connection with the issuance of the Bonds.
Capitalized Interest. Equals the amount required to be deposited for the purpose of paying
capitalized interest on the Bonds under the Indenture.
Underwriter’s Discount. Equals a percentage of the par amount of the Bonds related to the costs
of underwriting the Bonds, including Underwriter’s counsel fee.
Cost of Issuance. Includes costs of issuing the Bonds, including but not limited to City fees,
attorney’s fees, financial advisory fees, consultant fees, initial trustee fee, appraisal fees, printing costs,
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publication costs, City’s costs, fees charged by the Texas Attorney General, and any other cost or expense
directly associated with the issuance of the Bonds.
Other Costs
Deposit to Administrative Fund. Equals the amount necessary to fund the first year’s Annual
Collection Costs for the Bonds.
Costs of the Improvement Area #1 Authorized Improvements
The following table reflects the expected total costs of the Improvement Area #1 Authorized Improvements.
Expected Costs of Improvement Area #1 Authorized Improvements(1)
Improvement Area #1 Authorized Improvements
Total Expected Costs of
Improvement Area #1
Authorized
Improvements
Major Improvements(2)
Pavin /Roads/Streets $ 240,982
Wate 113,095
Sanitar Sewe 317,171
Storm Draina e 80,865
Soft Costs 278,400
Subtotal $ 1,030,513
Improvement Area #1 Improvements
Pavin /Roads/Streets $ 3,185,946
Wate 1,048,203
Sanitar Sewe 1,037,400
Storm Draina e 1,309,055
Soft Costs 2,150,076
Subtotal $ 8,30,679
Initial Administrative Fund Deposit
Subtotal $ 80,000
Bond Issuance Costs
Debt Service Reserve $ 548,614
Capitalized Interes 326,815
Underwriter’s Discoun 223,680
Costs of Issuance 554,891
Subtotal $ 1,654,000
Total(3) $11,495,192
1) Derived from information in the Service and Assessment Plan. Preliminary; subject to change.
2) Represents Improvement Area #1’s allocable share of the Major Improvements.
3) Totals may not add due to rounding.
The total costs of the Improvement Area #1 Authorized Improvements are expected to be approximately
11,495,192*. Only a portion of the costs of the Improvement Area #1 Authorized Improvements, in the approximate
amount of $7,456,000*, are expected to be paid with proceeds of the Bonds. The balance of the costs of the
Improvement Area #1 Authorized Improvements, in the total approximate amount of $4,039,192*, have been or will
be financed by the Developer and will not be reimbursed by the City. As of September 30, 2025, the Developer has
Preliminary; subject to change.
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spent approximately $1,089,425 on construction of the Improvement Area #1 Improvements and $824,462 on
construction of the Major Improvements.
Ownership and Maintenance of Improvement Area #1 Projects
The Improvement Area #1 Projects will be dedicated to and accepted by the City and will constitute a portion
of the City’s infrastructure improvements. The City will provide for the ongoing operation, maintenance, and repair
of the Improvement Area #1 Projects constructed and conveyed, as outlined in the Service and Assessment Plan.
THE DEVELOPMENT
The following information has been provided by the Developer. Certain of the following information is
beyond the direct knowledge of the City, the City’s Financial Advisor, and the Underwriter, and none of the City, the
City’s Financial Advisor, or the Underwriter have any way of guaranteeing the accuracy of such information.
Development Plan
The District is an approximately 274.396-acre master-planned community expected to be constructed in five
Improvement Areas and to include approximately 946 single-family detached residential lots, expected to consist of
approximately 418 50’ lots, 282 60’ lots, 151 70’ lots and 95 80’ lots, an amenity center, and a variety of trails and
public open space. The Development is situated just west of US 75 and south of White Street. The Development is
located within the City’s corporate limits, approximately 30 miles northeast of Frisco, 12 miles north of McKinney
and 22 miles south of Sherman.
The Developer expects to complete lot development in the Development in five phases with final
development of lots expected in Q3 2032. Improvement Area #1 is the first area of the District to be developed by
the Developer. The Developer began construction of the Improvement Area #1 Projects in Q2 2025 and expects to
complete construction of the Improvement Area #1 Projects and other improvements necessary for delivery of lots in
Improvement Area #1 in Q3 2026. See “THE IMPROVEMENT AREA #1 AUTHORIZED IMPROVEMENTS.”
The following table reflects the Developer’s expected completion schedules for lots in each Improvement
Area of the District.
Expected Lot Completion within the District
Improvement Area Expected Completion Date
1 Q3 2026
2 Q4 2027
3 Q2 2029
4 Q1 2031
5 Q3 2032
Improvement Area #1 consists of approximately 47.859 acres and is expected to include 171 single-family
detached residential lots, consisting of 123 50’ lots and 48 60’ lots. The Developer intends to construct homes on all
lots in Improvement Area #1. The Developer’s expectations regarding absorption of homes in Improvement Area #1
is shown in the following table.
Expected Absorption of Homes in Improvement Area #1 of the District
Expected Sale Dates
to Homeowners 50’ Lo 60’ Lo Total Lots
2027 90 30 120
2028 33 18 51
Total 123 48 171
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The Developer’s expectation regarding single-family residential lot prices and expected average home prices
in the District are as follows.
Lot Prices and Expected Average Home Prices in the District
Lot Size umber of Lots Base Lot Price(1) Expected Avera e Home Price(2)
Improvement Area #1
50’ 123 $100,000 $500,000
60’ 48 $120,000 $600,000
Total 171
Improvement Area #2
50’ 65 $100,000 $500,000
60’ 104 $120,000 $600,000
Total 169
Improvemen rea #3
60’ 130 $120,000 $600,000
70’ 69 $140,000 $700,000
80’ 23 $160,000 $800,000
Total 222
Improvement Area #4
50’ 230 $100,000 $500,000
Total 230
Improvemen rea #5
70’ 82 $140,000 $700,000
80’ 72 $160,000 $800,000
Total 154
1) Developer estimates. Estimates may differ from the values in the Appraisal. See “APPRAISAL” and “APPENDIX
G – Appraisal.”
2) Developer estimates.
Amenities and Private Improvements
In addition to the Improvement Area #1 Projects, the Development Agreement obligates the Developer to
construct seven of the following 12 amenities: (i) approximately 4,000 square foot swimming pool; (ii) mechanical
aquatic play feature; (iii) pool house with restrooms; (iv) playground (2-5 years of age); (v) playground (5-8 years of
age); (vi) sand volleyball court; (vii) basketball court; (viii) approximately 1,000 square foot putting green; (ix)
outdoor workout equipment along hike and bike trails; (x) 20 ft. radius pavilion; (xi) dog park; and (xii) park benches,
trash cans, and pet stations along the trail and in the dog park (collectively, the “Amenities”).
The Developer is also required to construct certain trails, with a minimum of 8’ in width, within the
Development (the “Community Trails”). At the City’s sole discretion, the Developer shall: (a) dedicate the
Community Trails to the City in fee simple and the City shall maintain the Community Trails as part of the City’s
park system; or (2) grant a public access easement over the Community Trails allowing access by the general public
and the HOA shall maintain the Community Trails. The Community Trails, if dedicated to the City in fee simple,
may-to the extent permitted under City Regulations-be used to offset a portion of applicable parkland dedication or
improvement requirements or fees required in lieu thereof, of any kind, including requirements for the payment of
park fees.
The Development Agreement requires the Developer to complete the swimming pool, aquatic play feature,
pool house with restrooms, and the hike and bike trails for the first phase of development of the District concurrently
with construction of homes in the first phase of development. The cost of the Amenities allocable to Improvement
Area #1 is expected to be approximately $2,400,000 (including approximately $1,500,000 for the amenity center), and
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will be paid entirely by the Developer, without reimbursement by the City, from proceeds of the Revolving Credit
Agreement.
The Amenities will be owned, operated, and maintained by the HOA. The HOA will provide for the ongoing
operation, maintenance, and repair of the Amenities through the administration of the HOA Fee to be paid by each lot
owner within the District. See “OVERLAPPING TAXES AND DEBT – Homeowners’ Association Dues.”
In addition, the Developer is responsible for paying the costs of certain private improvements benefitting
Improvement Area #1 (consisting of excavation, retaining walls, landscaping, screening, entryways, franchise fees,
and soft costs) (the “Private Improvements”) in the approximate amount of $2,864,044, which will be paid entirely by
the Developer, without reimbursement by the City, from proceeds of the Revolving Credit Agreement. The Developer
must complete the Private Improvements for each Improvement Area on or before 150 days after final City acceptance
of the public infrastructure for such Improvement Area. The Private Improvements will be owned, operated, and
maintained by the HOA.
Future Improvement Area Bonds
The Developer expects to request the City to issue Future Improvement Area Bonds to finance the costs of
the public improvements benefitting the Future Improvement Areas and the portion of the Major Improvements
allocable to the applicable Future Improvement Area. The estimated costs of the public improvements benefitting the
Future Improvement Areas will be determined as development progresses, and the Service and Assessment Plan will
be updated accordingly. Such Future Improvement Area Bonds will be secured by separate assessments levied
pursuant to the PID Act on assessable property within the Future Improvement Areas. The Developer anticipates that
Future Improvement Area Bonds will be issued over a six-year period.
The Bonds and any Future Improvement Area Bonds issued by the City are separate and distinct issues of
securities. The City reserves the right to issue Future Improvement Area Bonds for any purpose permitted by the PID
Act, including those described above.
Development Agreement
Pursuant to the Crystal Park Development Agreement by and among the City, the Developer, and Marquin
Miller, F.A. Miller and Virgil Wren Miller (collectively, the “Millers”), effective as of January 11, 2022, as amended
the “Development Agreement”), the Developer has the right to construct public improvements for the District,
including the Improvement Area #1 Projects, according to certain rules and regulations of the City, and to be
reimbursed for a portion of the costs of such construction through the proceeds of assessments and/or PID Bonds
defined below). The Developer Agreement covers the land within the District and approximately 116 acres adjacent
to the District (the “Adjacent Land” and, together with the land in the District, the “Property”). Of the Adjacent Land,
the Millers own approximately 30 acres, the Developer owns approximately 27 acres and the Mixed-Use Owners (as
defined herein) own approximately 59 acres. The Developer does not currently have any plans for development of its
portion of the Adjacent Land. The remaining portions of the Adjacent Land are expected to be developed by other
developers as commercial and multifamily developments.
The Development Agreement provides certain requirements to be met for the issuance of the Bonds and any
additional bonds issued for the payment of additional Authorized Improvements (defined in the Development
Agreement and the PID Act) (collectively, “PID Bonds”), including (i) the maximum equivalent tax rate, including
the PID assessments associated with the PID Bonds may not exceed $0.69 per $100 taxable assessed valuation without
prior written consent of the City; (ii) the ratio of the appraised value of the property being financed, as confirmed by
an independent appraisal, to the par amount of the PID Bonds proposed to be issued with respect to such property
must be at least 2:1, unless a lower ratio is approved by the City; and (iii) PID Bonds may be issued up to a maximum
principal amount of $50,000,000.
In addition to construction of the Improvement Area #1 Projects, the Amenities and the Community Trails,
the Development Agreement obligates the Developer to:
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Construct (i) the two-lane portion of Standridge Parkway immediately adjacent to the Property
necessary to connect the Property to FM 455, provided that Developer shall construct four lanes of
Standridge Parkway to connect the adjacent parcels (the “Master Thoroughfare”) and (ii) the two-
lane portion of a connector road immediately adjacent to the Property to connect the southern portion
of the Property to the Highway 75 frontage road (the “East/West Connector”) the costs of which, to
the extent not included in the costs of Authorized Improvements, shall be reimbursed to the
Developer through Impact Fee Credits (as defined in the Development Agreement). The Master
Thoroughfare is considered a Major Improvement a portion of the costs for which are expected
to be reimbursed with proceeds of the Bonds and Future Improvement Area Bonds. The
East/West Connector is not being constructed at this time. The Developer expects to construct
the East/West Connector with the second Improvement Area. The Developer expects that the
East/West Connector will be a future additional major improvement, the costs of which will be
an Authorized Improvement in the Service and Assessment Plan, and that a portion of the costs
of such construction are expected to be reimbursed to the Developer through Future
Improvement Area Bonds. The Developer expects to contribute the portion of the costs of the
East/West Collector allocable to Improvement Area #1.
When and if requested by Anna ISD, the Developer shall convey a tract of land within the Property
of at least 9.5 acres (the “School Site”) to Anna ISD. Such conveyance may require that should
construction of a school within the School Site not commence within ten years from such
conveyance, the School Site shall revert to Developer in fee simple. Anna ISD has not requested
conveyance of the School Site. If requested, the Developer expects the School Site to be located
in the Adjacent Land owned by the Developer.
Pay to the City, simultaneously with the closing of each series of PID Bonds issued, $3,400 times
the number of residential lots in the applicable phase of development for which the PID Bonds are
being issued (the “City PID Fee”). The aggregate amount of the City PID Fee shall not exceed
3,304,800 (972 single- family residential lots multiplied by $3,400) and shall not be refundable for
any reason.
Create a mandatory homeowners’ association over the District and any other property to be
developed as a single-family development and a mandatory property owners’ association over
property to be developed as commercial or multifamily.
Under the Development Agreement, the Developer and the City acknowledged that the City is expected to
build a treatment plant including a lift station on property to be situated to the southwest of the Property (the
Treatment Facilities”). If the Treatment Facilities are not completed and operational at the time of the issuance of
the first building permit for the District, the City shall provide pump and haul services to the District at the City’s cost
until the Treatment Facilities are completed. The City has completed the Treatment Facilities. The Developer is
required to construct an off-site line to connect the Property to the Treatment Facilities (the “Off-site Sewer Line”)
and an off-site water line (the “Off-site Water Line” and, together with the Off-Site Sewer Line, the “Off-Site
Improvements”), and such Off-Site Improvements shall be an Authorized Improvement to the extent they confer a
special benefit on the property within the District; provided that, to the extent the City requires the Developer to
oversize the Off-Site Improvements beyond what is necessary to serve the Property, such portion of the Off-Site
Improvements shall not constitute an Authorized Improvement, and the City shall pay the cost of such oversizing. The
Developer is currently constructing the Off-site Improvements as part of the Major Improvements, and expects that
the costs of the Off-Site Improvements will be reimbursed with proceeds of the Bonds, Future Improvement Area
Bonds and Impact Fee Credits.
CFA Agreement
The City and the Developer expect to enter into the CFA Agreement, effective November 17, 2025, which
provides, in part, for the deposit of proceeds of the Bonds and the payment of a portion of the costs of the Improvement
Area #1 Projects, and other matters related thereto. Pursuant to the CFA Agreement, the Developer is responsible for
overseeing the construction and development of the Improvement Area #1 Projects in accordance with the
Development Agreement and the CFA Agreement. The City’s obligation to pay or reimburse the Developer for the
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Improvement Area #1 Project Costs is limited to the lesser of the Actual Costs or Budgeted Costs, and any Cost
Overruns (as each of such terms are defined in the CFA Agreement) are the Developer’s responsibility. See
APPENDIX F – Form of CFA Agreement.”
Zoning/Permitting
The District is currently zoned as a planned development district pursuant to Ordinance No. 969-2022
adopted by the City Council on March 22, 2022 (the “PDD Ordinance”). The PDD Ordinance, which also covers the
Adjacent Land, allows certain restricted commercial, single-family residential, and single-family residential zero lot
line uses and establishes guidelines pertaining to purpose, height, area, setbacks, aesthetics, landscaping, and use.
Because the District lies within the city limits of the City, the City’s zoning and subdivision regulations control the
aspects of development not specifically set forth in the PDD Ordinance or the Development Agreement.
Education
Students in the District will attend schools in Anna ISD. Anna ISD serves the City and other portions of the
County. Anna ISD enrolls over 4,500 students in one high school, a middle school, four elementary schools, and a
special programs center. Students in the District are expected to attend Sue Evelyn Rattan Elementary School
approximately 2.5 miles from the District), Clemons Creek Middle School (approximately 5.7 miles from the
District), and Anna High School (approximately 3.5 miles from the District).
GreatSchools.org currently rates Sue Evelyn Rattan Elementary School 7 out of 10, and Anna High School
6 out of 10. Greatschools.org has not yet rated Clemons Creek Middle School. According to the Texas Education
Agency (“TEA”) accountability reports, Sue Evelyn Rattan Elementary School and Clemons Creek Middle School
were rated “C” and Anna High School was rated “A” for the 2024-2025 school year. The categories for public schools
are A, B, C, D, and F.
Environmental
A Phase I Environmental Site Assessment (the “Phase One ESA”) of the District and a portion of the Adjacent
Land was completed in October 2021 by Alpha Testing, Inc. (“Alpha”), the report of which is dated October 18, 2021
the “Report”). According to the Report, the Phase One ESA revealed no evidence of recognized environmental
conditions involving the property.
According to the website for the Texas Parks and Wildlife Department, the whooping crane is a federally
recognized endangered species and the rufa red knot, piping plover, and black rail are federally recognized threatened
species in Collin County. The Developer is not aware of any endangered or threatened species located on the Property.
Existing Mineral Rights
Third parties hold title to certain rights applicable to real property within and around the District (the “Mineral
Owners”), including reservations of mineral rights and royalty interests and easements (collectively, the “Third-Party
Property Rights”) pursuant to various instruments in the chain of title for various tracts of land within and immediately
adjacent to the District. These reservations of mineral rights include a waiver by the Mineral Owners of their right to
enter onto the surface of the property to explore, develop, drill, produce or extract minerals within the District. The
Mineral Owners may only develop such mineral interests by means of wells drilled on land outside of the property of
the District.
The Developer is not aware of any ongoing mineral rights development or exploration on or adjacent to the
property within the District. The Developer is not aware of any interest in real property (including mineral rights)
owned by the Mineral Owners adjacent to the District. Certain rules and regulations of the Texas Railroad
Commission may also restrict the ability of the Mineral Owners to explore or develop the property due to well density,
acreage, or location issues.
Although the Developer does not expect the above-described Third-Party Property Rights, or the exercise of
such rights or any other third-party real property rights in or around the District, to have a material adverse effect on
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the Development, the property within the District, or the ability of landowners within Improvement Area #1 to pay
Improvement Area #1 Assessments, the Developer makes no guarantee as to such expectation. See
BONDHOLDERS’ RISKS – Exercise of Third-Party Property Rights.”
Flood Zone
According to the Federal Emergency Management Agency (“FEMA”) Flood Insurance Rate Map,
Community Panel Number 48085C0155J, effective June 2, 2009, all of the property within the District lies outside of
the 100-year and 500-year flood plain, referred to as Zone X.
Utilities
Water and Wastewater. The City will provide both water and wastewater service to the District. The City’s
water distribution system and wastewater collection and treatment system currently have sufficient capacity to provide
water and wastewater service to the District. See “THE CITY – Water and Wastewater.”
Other Utilities. The Developer expects additional utilities to be provided by: (1) Phone/Data – Grayson Collin
Communications (“GCC”); (2) Electric – Grayson Collin Electric Cooperative; (3) Cable – GCC; and (4) Natural Gas
Atmos Energy.
THE DEVELOPER
The following information has been provided by the Developer. Certain of the following information is
beyond the direct knowledge of the City, the City’s Financial Advisor, and the Underwriter, and none of the City, the
City’s Financial Advisor, or the Underwriter have any way of guaranteeing the accuracy of such information.
General
In general, the activities of a developer in a development such as the District include purchasing the land,
designing the subdivision, including the utilities and streets to be installed and any community facilities to be built,
defining a marketing program and building schedule, securing necessary governmental approvals and permits for
development, arranging for the construction of roads and the installation of utilities (including, in some cases, water,
sewer, and drainage facilities, as well as telephone and electric service) and selling improved lots and commercial
reserves, if any, to builders, developers, or other third parties. The relative success or failure of a developer to perform
such activities within a development may have a material effect on the security of revenue bonds, such as the Bonds,
issued by a municipality for a public improvement district. A developer is generally under no obligation to a public
improvement district, such as the District, to develop the property which it owns in a development. Furthermore, there
is no restriction on the developer’s right to sell any or all of the land which the developer owns within a development.
In addition, a developer is ordinarily the major tax and assessment payer within a district during its development.
Description of the Developer
The Developer owns the property in the District, including Improvement Area #1. Bloomfield Properties,
Inc. is the Developer’s general partner (Bloomfield Properties, Inc. and Developer are, together, “Bloomfield”).
Bloomfield was formed in September 2004 with Don Dykstra as President. In July 2013 by Sumitomo Forestry
America, Inc. (“Sumitomo”) purchased 50% of Bloomfield, and in May 2017 Sumitomo purchased an additional 15%
of Bloomfield and Bloomfield became a consolidated subsidiary of Sumitomo. The remaining 35% is owned by
entities controlled by Mr. Dykstra and Tim Stewart. Sumitomo was founded in 1691 and is a publicly traded company
listed on the Tokyo Stock Exchange.
Bloomfield develops the majority of the lots that it builds homes on in approximately sixty locations
throughout the DFW Metroplex. Since its founding Bloomfield has developed approximately 13,500 lots and
constructed approximately 19,500 homes. Bloomfield has experience developing in neighborhoods with various types
of District financing, including Paloma Creek in Little Elm, Cross Oak Ranch in Oak Point, Woodcreek in Fate and
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Grand Heritage in Lavon and has built homes in neighborhoods with public improvement districts, including
Timberbrook in Justin and Meadow Vista in Anna.
Bloomfield focuses on the price range between $300,000 and $800,000 and, per Residential Strategies Inc.
RSI”) (4th quarter 2024 report) has the fifth largest market share in the Dallas – Fort Worth market. For 2024,
Bloomfield was ranked as the 33rd largest builder in the United States per ProBuilder Magazine Top 200 Builders.
Bloomfield was also named 2021 Homebuilder of the Year by the Greater Fort Worth Builder Association.
By combining development with homebuilding expertise Bloomfield has been able to design and develop
neighborhoods directly responding to the needs of targeted buyer profiles. This has translated into a vertically
integrated operation with great efficiencies and high sales volume.
Examples of projects undertaken by Bloomfield include:
ame Cit
Number of
Lots Remainin
Total Number
of Lots
Average Home
Prices
West Crossin Anna 33 733 $586,000
Kre mer Estates W lie 11 446 $607,000
Countr Lakes Denton 74 549 $591,000
Arrowbroo Aubre 107 702 $586,000
Rid e Ranch Mesquite 516 896 $489,000
Timberbroo Justin 1,345 1,820 $535,000
Biographies of Key Developer Parties
Don Dykstra. Don Dykstra has been President of Bloomfield Properties, Inc., since its founding in 2004 and
is primarily focused on land acquisition, entitlement, and development. From 1987 through 2003, Don worked for
Pulte Home Corporation in a variety of management positions, including President of the Dallas – Fort Worth
Division. From 1981 to 1987, he worked as a certified public accountant with EY & Company with a specialty in real
estate. Don received his Bachelor of Science degree in Accounting from California Polytechnic University – Pomona,
California, in 1981.
Tim Stewart. Tim Stewart joined Bloomfield Homes in 2010 and is Vice President of Bloomfield Properties,
Inc., and President of the Developer. Tim is responsible for the homebuilding operation. From 1993 to 2010, Tim
was with Pulte Home Corporation in a variety of management positions including Division President for San Antonio
and Senior Vice President for Asset Management. From 1990 to 1993 Tim was a certified public accountant with
Price Waterhouse & Co. Tim received his Bachelor of Science degree in Accounting from Michigan State University
in 1990.
Steve Corradi. Steve Corradi has been Vice President of Finance with the Developer since 2016. Prior to
joining Bloomfield, Steve held financial management positions with a number of firms in the homebuilding,
contracting, and telecommunications industries. Steve also was a certified public accountant with EY & Company
from 1981 to 1987. Steve received his Bachelor of Science in Accounting from the Wharton school of Business –
University of Pennsylvania in 1981.
Clint Vincent. Clint Vincent has been Vice President of Land with Bloomfield since 2020 and oversees all
land development activities. Clint has worked in land development for public and private companies in the Dallas –
Fort Worth market since 2000. Clint received a Bachelor of Science in Civil Engineering from Texas Tech University
in 1999.
History and Financing of the District
Property Acquisition. The Developer acquired the land in the District and a portion of the Adjacent Land in
two transactions on December 16, 2021 from various members of the Miller and Rollins families (as listed on the
deeds). The first transaction was 116.974 acres purchased for $5,264,037. The second transaction was 243.477 acres
45
purchased for $10,956,490. The purchase prices were funded with the existing Revolving Credit Agreement and there
are no deeds of trust or liens on the property.
On November 3, 2023, the Developer subsequently sold 29.399 acres and 29.754 acres of such property to
Crystal Anna Residential Partners and Wildflower Anna LLC (together, the “Mixed-Use Owners”), respectively,
which property lies outside the District, is part of the Adjacent Land under the Development Agreement, and is
expected to be developed as adjacent commercial and multifamily development. The collective purchase price for
such properties was $9,137,220.
Acquisition and Development Financing. The Developer has entered into a Fifth Amended and Restated
Credit Agreement, dated as of April 30, 2024 (the “Revolving Credit Agreement”), with a group of lenders led by
Fifth Third Bank, National Association (collectively, the “Lenders”) providing for loans in a combined maximum
amount of $500,000,000 outstanding at any time. The Revolving Credit Agreement is unsecured and matures on April
30, 2028. As of September 30, 2025, the Developer had loans outstanding in the amount of $394,680,000, leaving
105,320,000 available pursuant to the Revolving Credit Agreement. The Developer may repay the outstanding
portion of the Revolving Credit Agreement from any available resources, including revenue generated from sales of
the lots developed and homes constructed in the District.
The Revolving Credit Agreement imposes a number of conditions upon the Developer’s right to obtain loans.
If the Developer were unable to satisfy such conditions, release of funds from the Revolving Credit Agreement and
the construction of the Improvement Area #1 Projects could be delayed or prevented entirely, which would adversely
affect the security for the Bonds.
There are no liens against the property within the District. The PID Act provides that the Assessment Lien
is a first and prior lien against the assessed property within Improvement Area #1 of the District and is superior to all
other liens and claims except liens or claims for State, county, school district, or municipality ad valorem taxes.
Sufficiency of Developer’s Financing. According to the Developer, the Developer’s available financing
sources are sufficient to fund the total budgeted costs of the Improvement Area #1 Projects in the approximate amount
of $9,761,192, the costs of the Private Improvements in the approximate amount of $2,864,044, and the expected costs
of the Amenities allocable to Improvement Area #1 in the approximate amount of $2,400,000. The Developer’s
financing sources include the Revolving Credit Agreement and the net proceeds of the Bonds in the approximate
amount of $5,722,000*, and Developer equity. See “SOURCES AND USES,” “THE IMPROVEMENT AREA #1
AUTHORIZED IMPROVEMENTS,” and “THE DEVELOPMENT – Amenities and Private Improvements.”
THE ADMINISTRATOR
The following information has been provided by the Administrator. Certain of the following information is
beyond the direct knowledge of the City, the City’s Financial Advisor, and the Underwriter, and none of the City, the
City’s Financial Advisor, or the Underwriter have any way of guaranteeing the accuracy of such information. The
Administrator has reviewed this Limited Offering Memorandum and warrants and represents that the information
herein under the caption “THE ADMINISTRATOR” does not contain any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements made herein, in the light of the circumstances
under which they are made, not misleading.
The City has selected P3Works, LLC, as the Administrator for the District. The City has entered into an
agreement with the Administrator to provide specialized services related to the administration of the District needed
to support the issuance of the Bonds. The Administrator will primarily be responsible for preparing the annual update
to the Service and Assessment Plan. The Administrator is a consulting firm focused on providing district services
relating to the formation and administration of public improvement districts, and is based in Austin, Houston, and
North Richland Hills, Texas.
Preliminary; subject to change.
46
The Administrator’s duties will include:
Preparation of the annual update to the Service and Assessment Plan
Preparation of assessment rolls for City billing and collection
Establishing and maintaining a database of all City parcel IDs within the District
Trust account analysis and reconciliation
Property owner inquires
Determination of Prepayment amounts
Preparation and review of disclosure notices with Dissemination Agent
Review of developer draw requests for reimbursement of authorized improvement costs.
APPRAISAL
General. Peyco Southwest Realty, Inc. (the “Appraiser”) prepared an appraisal report for the City effective
as of July 1, 2026, based upon a physical inspection of Improvement Area #1 of the District conducted on September
15, 2025 (the “Appraisal”). The Appraisal was prepared at the request of the City and the Underwriter. The
description herein of the Appraisal is intended to be a brief summary only of the Appraisal as it relates to Improvement
Area #1 of the District. The Appraisal is attached hereto as APPENDIX G and should be read in its entirety. The
conclusions reached in the Appraisal are subject to certain assumptions, hypothetical conditions, and qualifications,
which are set forth therein. See “APPENDIX G – Appraisal.”
Value Estimates. The Appraiser estimated the prospective market value of the fee simple interests of the
Improvement Area #1 Assessed Property at completion of the Improvement Area #1 Projects. See “THE
IMPROVEMENT AREA #1 AUTHORIZED IMPROVEMENTS.” The Appraisal does not reflect the value of
Improvement Area #1 of the District as if sold to a single purchaser in a single transaction. The prospective market
value estimate “upon completion” of Improvement Area #1 using the methodologies described in the Appraisal and
subject to the limiting conditions and assumptions set forth in the Appraisal, as of July 1, 2026, is $16,574,000
97,000/lot).
None of the City, the Developer, the Financial Advisor, or the Underwriter makes any representation as to
the accuracy, completeness assumptions or information contained in the Appraisal. The assumptions and
qualifications with respect to the Appraisal are contained therein. There can be no assurance that any such assumptions
will be realized and the City, the Developer and the Underwriter make no representation as to the reasonableness of
such assumptions. See “BONDHOLDERS’ RISKS – Use of Appraisal.”
Prospective investors should read the complete Appraisal in order to make an informed decision
regarding any contemplated purchase of the Bonds. The complete Appraisal is attached as APPENDIX G.
BONDHOLDERS’ RISKS
Before purchasing any of the Bonds, prospective investors and their professional advisors should carefully
consider all of the risk factors described below which may create possibilities wherein interest may not be paid
when due or that the Bonds may not be paid at maturity or otherwise as scheduled, or, if paid, without premium, if
applicable. The following risk factors (which are not intended to be an exhaustive listing of all possible risks
associated with an investment in the Bonds) should be carefully considered prior to purchasing any of the Bonds.
Moreover, the order of presentation of the risks summarized below does not necessarily reflect the significance of
such investment risks.
General
THE BONDS ARE SPECIAL, LIMITED OBLIGATIONS OF THE CITY PAYABLE SOLELY
FROM A FIRST LIEN ON, SECURITY INTEREST IN, AND PLEDGE OF THE TRUST ESTATE, AS AND
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TO THE EXTENT PROVIDED IN THE INDENTURE. THE BONDS DO NOT GIVE RISE TO A CHARGE
AGAINST THE GENERAL CREDIT OR TAXING POWER OF THE CITY AND ARE PAYABLE SOLELY
FROM THE TRUST ESTATE IDENTIFIED IN THE INDENTURE. THE OWNERS OF THE BONDS
SHALL NEVER HAVE THE RIGHT TO DEMAND PAYMENT THEREOF OUT OF MONEY RAISED OR
TO BE RAISED BY TAXATION, OR OUT OF ANY FUNDS OF THE CITY OTHER THAN THE TRUST
ESTATE, AS AND TO THE EXTENT PROVIDED IN THE INDENTURE. NO OWNER OF THE BONDS
SHALL HAVE THE RIGHT TO DEMAND ANY EXERCISE OF THE CITY’S TAXING POWER TO PAY
THE PRINCIPAL OF THE BONDS OR THE INTEREST OR REDEMPTION PREMIUM, IF ANY,
THEREON. THE CITY SHALL HAVE NO LEGAL OR MORAL OBLIGATION TO PAY THE BONDS
OUT OF ANY FUNDS OF THE CITY OTHER THAN THE TRUST ESTATE.
The Underwriter is not obligated to make a market in or repurchase any of the Bonds, and no
representation is made by the Underwriter, the City, or the City’s Financial Advisor that a market for the
Bonds will develop and be maintained in the future. If a market does develop, no assurance can be given
regarding future price maintenance of the Bonds. See “– Limited Secondary Market for the Bonds” herein.
The City has not applied for or received a rating on the Bonds. The absence of a rating could affect the
future marketability of the Bonds. There is no assurance that a secondary market for the Bonds will develop
or that holders who desire to sell their Bonds prior to the stated maturity will be able to do so. See “– No Credit
Rating” herein.
Deemed Representations and Acknowledgment by Investors
Each Investor will be deemed to have acknowledged and represented to the City the matters set forth under
the heading “LIMITATIONS APPLICABLE TO INITIAL PURCHASERS” which include, among others, a
representation and acknowledgment that the purchase of the Bonds involves investment risks, certain of which are set
forth under this heading “BONDHOLDERS’ RISKS” and elsewhere herein, and such Investor, either alone or with
its purchaser representative(s) (as defined in Rule 501(h) of Regulation D under the Securities Act of 1933), has
sophisticated knowledge and experience in financial and business matters and the capacity to evaluate such risks in
making an informed investment decision to purchase the Bonds, and the Investor can afford a complete loss of its
investment in the Bonds.
General Factors Relating to Payment of the Bonds
The ability of the City to pay debt service on the Bonds as due is subject to various factors that are beyond
the City’s control. These factors include, among others, (a) the ability or willingness of property owners within
Improvement Area #1 to pay Improvement Area #1 Assessments levied by the City, (b) cash flow delays associated
with the institution of foreclosure and enforcement proceedings against property within Improvement Area #1, (c)
general and local economic conditions which may impact real property values, the ability to liquidate real property
holdings and the overall value of real property development projects, and (d) general economic conditions which may
impact the general ability to market and sell the property within the District, it being understood that poor economic
conditions within the City, State and region may slow the assumed pace of sales of such property.
The rate of development of the property in the District is directly related to the vitality of the residential
housing industry. In the event that the sale of the land within Improvement Area #1 should proceed more slowly than
expected and the Developer is unable to pay the Improvement Area #1 Assessments, only the value of the
Improvement Area #1 Assessed Property, with improvements, will be available for payment of the debt service on the
Bonds, and such value can only be realized through the foreclosure or expeditious liquidation of the lands within
Improvement Area #1. There is no assurance that the value of such lands will be sufficient for that purpose and the
expeditious liquidation of real property through foreclosure or similar means is generally considered to yield sales
proceeds in a lesser sum than might otherwise be received through the orderly marketing of such real property.
Assessment Limitations
Improvement Area #1 Annual Installments of Improvement Area #1 Assessments are billed to property
owners in Improvement Area #1 of the District. Improvement Area #1 Annual Installments are due and payable, and
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bear the same penalties and interest for non-payment, as for ad valorem taxes as described under “ASSESSMENT
PROCEDURES.” Additionally, Improvement Area #1 Annual Installments established by the Service and
Assessment Plan correspond in number and proportionate amount to the number of installments and principal amounts
of Bonds maturing in each year, interest on such principal, and the Annual Collection Costs for such year. See
ASSESSMENT PROCEDURES.” The unwillingness or inability of a property owner to pay regular property tax
bills as evidenced by property tax delinquencies may also indicate an unwillingness or inability to make regular
property tax payments and Improvement Area #1 Annual Installments of Improvement Area #1 Assessment payments
in the future.
In order to pay debt service on the Bonds, it is necessary that Improvement Area #1 Annual Installments are
paid in a timely manner. Due to the lack of predictability in the collection of Improvement Area #1 Annual
Installments in Improvement Area #1 of the District, the City has established a Reserve Account in the Reserve Fund,
to be funded from the proceeds of the Bonds, to cover delinquencies. The Improvement Area #1 Annual Installments
are secured by the Assessment Lien. However, there can be no assurance that foreclosure proceedings will occur in a
timely manner so as to avoid depletion of the Reserve Account and delay in payments of debt service on the Bonds.
See “BONDHOLDERS’ RISKS – Bondholders’ Remedies and Bankruptcy of Property Owners.”
Upon an ad valorem tax lien foreclosure event of a property within Improvement Area #1, any Improvement
Area #1 Assessment that is delinquent will be foreclosed upon in the same manner as the ad valorem tax lien (assuming
all necessary conditions and procedures for foreclosure are duly satisfied). To the extent that a foreclosure sale results
in insufficient funds to pay in full both the delinquent ad valorem taxes and the delinquent Improvement Area #1
Assessments, the liens securing such delinquent ad valorem taxes and delinquent Improvement Area #1 Assessments
would likely be extinguished. Any remaining unpaid balance of the delinquent Improvement Area #1 Assessments
would then be an unsecured personal liability of the original property owner.
Based upon the language of Texas Local Government Code, §372.017(b), case law relating to other types of
assessment liens and opinions of the Texas Attorney General, the Assessment Lien as it relates to Annual Installment
payments that are not yet due should remain in effect following an ad valorem tax lien foreclosure, with future
installment payments not being accelerated. Texas Local Government Code §372.018(d) supports this position,
stating that an Assessment Lien runs with the land and the portion of an assessment payment that has not yet come
due is not eliminated by foreclosure of an ad valorem tax lien.
The Assessment Lien is superior to any homestead rights of a property owner that were properly claimed
after the adoption of the Assessment Ordinance. However, an Assessment Lien may not be foreclosed upon if any
homestead rights of a property owner were properly claimed prior to the adoption of the Assessment Ordinance (“Pre-
existing Homestead Rights”) for as long as such rights are maintained on the property. It is unclear under State law
whether or not Pre-existing Homestead Rights would prevent the Assessment Lien from attaching to such homestead
property or instead cause the Assessment Lien to attach, but remain subject to, the Pre-existing Homestead Rights.
Under State law, in order to establish homestead rights, the claimant must show a combination of both overt
acts of homestead usage and intention on the part of the owner to claim the land as a homestead. Mere ownership of
the property alone is insufficient and the intent to use the property as a homestead must be a present one, not an
intention to make the property a homestead at some indefinite time in the future. As of the date of adoption of the
Assessment Ordinance, no such homestead rights will have been claimed. Furthermore, the Developer will own 100%
of the property within Improvement Area #1 of the District at the time the Improvement Area #1 Assessments are
levied and is not eligible to claim homestead rights. Consequently, there are and can be no homestead rights on the
Improvement Area #1 Assessed Property superior to the Assessment Lien and, therefore, the Assessment Lien may
be foreclosed upon by the City.
Failure by owners of the parcels to pay Improvement Area #1 Annual Installments when due, depletion of
the Reserve Fund, delay in foreclosure proceedings, or the inability of the City to sell parcels which have been subject
to foreclosure proceedings for amounts sufficient to cover the delinquent installments of Improvement Area #1
Assessments levied against such parcels may result in the inability of the City to make full or punctual payments of
debt service on the Bonds.
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THE IMPROVEMENT AREA #1 ASSESSMENTS CONSTITUTE A FIRST AND PRIOR LIEN
AGAINST THE IMPROVEMENT AREA #1 ASSESSED PROPERTY, SUPERIOR TO ALL OTHER LIENS AND
CLAIMS EXCEPT LIENS AND CLAIMS FOR STATE, COUNTY, SCHOOL DISTRICT, OR MUNICIPALITY
AD VALOREM TAXES AND WILL BE PERSONAL OBLIGATIONS OF AND CHARGES AGAINST THE
OWNERS OF PROPERTY LOCATED WITHIN IMPROVEMENT AREA #1 OF THE DISTRICT.
State Law Requiring Notice of Assessment; Failure of Developer to Deliver Required Notice Pursuant to
Texas Property Code
The 87th Legislature passed HB 1543, which became effective September 1, 2021, and requires a person
who proposes to sell or otherwise convey real property within a public improvement district to provide to the purchaser
of the property, before the execution of a binding contract for the purchase of such real property, written notice of the
obligation to pay public improvement district assessments, in accordance with Section 5.014, Texas Property Code,
as amended. In the event a contract of purchase and sale is entered into without the seller providing the notice, the
intended purchaser is entitled to terminate the contract of purchase and sale. If the Developer does not provide the
required notice and prospective purchasers of property within Improvement Area #1 terminate a purchase and sale
contract, the anticipated absorption schedule may be affected. In addition to the right to terminate the purchase
contract, a property owner who did not receive the required notice is entitled, after sale, to sue for damages for (i) all
costs relative to the purchase, plus interest and reasonable attorney’s fees, or (ii) an amount not to exceed $5,000, plus
reasonable attorney’s fees. In a suit filed pursuant to clause (i), any damages awarded must go first to pay any
outstanding liens on the property. In such an event, the outstanding Improvement Area #1 Assessments on such
property should be prepaid. See “DESCRIPTION OF THE BONDS – Redemption Provisions.” In the event of such
prepayment, a partial redemption of the Bonds could occur. On payment of all damages respectively to the lienholders
and purchaser pursuant to clause (i), the purchaser is required to reconvey the property to the seller. Further, if the
Developer does not provide the required notice and become liable for monetary damages, the anticipated buildout and
absorption schedule may be affected. No assurances can be given that the projected buildout and absorption schedules
presented in this Limited Offering Memorandum will be realized. The forms of notice to be provided to homebuyers
are attached as Appendix B to the Service and Assessment Plan and will be included in each Annual Service Plan
Update. See “Appendix B – Form of Service and Assessment Plan.”
Potential Future Changes in State Law Regarding Public Improvement Districts
During Texas legislative sessions and interim business of the Texas legislature, various proposals and reports
have been presented by committees of Texas Senate and Texas House of Representative which suggest or recommend
changes to the PID Act relating to oversight of bonds secured by special assessments including adopting requirements
relating to levels of build out or adding State level oversight in connection with the issuance of bonds secured by
special assessments under the PID Act. The 89th Legislative Session of the State convened on January 14, 2025 and
concluded on June 2, 2025. When the regular Legislature is not in session, the Governor of Texas may call one or
more special sessions, at the Governor’s direction, each lasting no more than 30 days, and for which the Governor sets
the agenda. Since the conclusion of the 89th Regular Session, the Governor called two special sessions, the first special
session which began on July 21, 2025 and concluded on August 15, 2025 and the second special session which began
on August 15, 2025 and concluded on September 4, 2025. It is impossible to predict what new proposals may be
presented regarding the PID Act and the issuance of special assessment bonds during any upcoming legislative
sessions, whether such new proposals or any previous proposals regarding the same will be adopted by the Texas
Senate and House of Representatives and signed by the Governor, and, if adopted, the form thereof. It is impossible
to predict with certainty the impact that any such future legislation will or may have on the security for the Bonds.
General Risks of Real Estate Investment and Development
Investments in undeveloped or developing real estate are generally considered to be speculative in nature and
to involve a high degree of risk. The Development will be subject to the risks generally incident to real estate
investments and development. Many factors that may affect the Development, including the schedule for and/or the
costs of the various improvements to be constructed within the District necessary to serve residents therein, as well as
the operating revenues of the Developer, including those derived from the Development, are not within the control of
the Developer. Such factors include changes in national, regional and local economic conditions; changes in long and
short term interest rates; changes in the climate for real estate purchases; changes in demand for or supply of competing
50
properties; changes in local, regional and national market and economic conditions; unanticipated development costs,
market preferences and architectural trends; unforeseen environmental risks and controls; the adverse use of adjacent
and neighboring real estate; changes in interest rates and the availability of mortgage funds to buyers of the homes to
be built in the Development, which may render the sale of such homes difficult or unattractive; acts of war, terrorism
or other political instability; delays or inability to obtain governmental approvals; changes in laws; moratorium; acts
of God (which may result in uninsured losses); strikes; labor shortages; energy shortages; material shortages; inflation;
adverse weather conditions; contractor or subcontractor defaults; and other unknown contingencies and factors beyond
the control of the Developer.
The Development cannot be completed without the Developer obtaining a variety of governmental approvals
and permits, some of which have already been obtained. Certain permits are necessary to initiate construction of each
phase of the Development and to allow the occupancy of residences and to satisfy conditions included in the approvals
and permits. There can be no assurance that all of these permits and approvals can be obtained or that the conditions
to the approvals and permits can be fulfilled. The failure to obtain any of the required approvals or fulfill any one of
the conditions could cause materially adverse financial results for the Developer.
A slowdown of the development process and the related absorption rate within the Development because of
any or all of the foregoing could affect adversely land values. As described herein, the Improvement Area #1
Assessments are an imposition against the land only. Neither the Developer nor any other subsequent landowner is a
guarantor of the Improvement Area #1 Assessments and the recourse for the failure of the Developer or any other
landowner to pay the Improvement Area #1 Assessments is limited to the collection proceedings against the land as
described herein. The timely payment of the Bonds depends on the willingness and ability of the Developer and any
subsequent owners to pay the Improvement Area #1 Assessments when due. Any or all of the foregoing could reduce
the willingness and ability of such owners to pay the Improvement Area #1 Assessments and could greatly reduce the
value of the property within Improvement Area #1 in the event such property has to be foreclosed. If Improvement
Area #1 Annual Installments are not timely paid and there are insufficient funds in the accounts of the Reserve Fund,
a nonpayment could result in a payment default under the Indenture.
Risks Related to the Current Residential Real Estate Market
The real estate market is currently experiencing a slowing of new home sales and new home closings due in
part to rising inflation and mortgage interest rates. It is difficult to determine what effects the tariffs imposed by the
federal administration and the retaliatory tariffs against the United States will have on inflation and mortgage interest
rates. Downturns in the real estate market, mortgage rates, and other factors beyond the control of the Developer,
including general economic conditions, may impact the timing of parcel, lot, and home sales within the District. No
assurances can be given that projected home prices and buildout values presented in this Limited Offering
Memorandum will be realized.
Risks Related to Increase in Costs of Building Materials and Labor Shortages
As a result of low supply and high demand, shipping constraints, and the ongoing trade war (including tariffs
and retaliatory tariffs), there have been substantial increases in the cost of lumber and other materials, causing many
homebuilders and general contractors to experience budget overruns. Further, the federal administration’s impositions
and threatened impositions of tariffs and the imposition or threatened imposition of retaliatory tariffs against the
United States will impact the ability of the Developer to estimate costs. If the Actual Costs of the Improvement Area
1 Projects are substantially greater than the estimated costs or if the Developer is unable to access building materials
in a timely manner, it may affect the ability of the Developer to complete the Improvement Area #1 Projects or pay
the Improvement Area #1 Assessments when due. See “THE DEVELOPER – History and Financing of the District.”
If the cost of materials remains high or increase, it may affect the ability of the Developer to construct homes within
Improvement Area #1.
The federal administration’s immigration policies may impact the State’s workforce. Undocumented
construction workers make up a large percentage of construction workers in the State. Mass deportations or
immigration policies that make it challenging for foreign workers to work in the United States may result in labor
shortages, particularly in construction. Labor shortages will impact the Developer’s ability to estimate costs and to
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complete the Improvement Area #1 Projects and the Developer’s ability to construct homes within Improvement Area
1.
Completion of Homes
The cost and time for completion of homes by the Developer is uncertain and may be affected by changes in
national, regional and local economic conditions; changes in long and short term interest rates; changes in the climate
for real estate purchases; changes in demand for or supply of competing properties; changes in local, regional and
national market conditions; unanticipated development costs, market preferences and architectural trends; unforeseen
environmental risks and controls; the adverse use of adjacent and neighboring real estate; changes in interest rates and
the availability of mortgage funds to buyers of the homes yet to be built in the Development, which may render the
sale of such homes difficult or unattractive; acts of war, terrorism or other political instability; delays or inability to
obtain governmental approvals; changes in laws; moratorium; force majeure (which may result in uninsured losses);
strikes; labor shortages; energy shortages; material shortages; inflation; adverse weather conditions; subcontractor
defaults; and other unknown contingencies and factors beyond the control of the Developer.
Absorption Rate
There can be no assurance that the Developer will be able to achieve its anticipated absorption rates. Failure
to achieve the absorption rate estimates may adversely affect the estimated value of the District, could impair the
economic viability of the District, and could reduce the ability or desire of property owners in Improvement Area #1
to pay the Improvement Area #1 Assessments.
Competition
The housing industry in the Dallas-Fort Worth area is very competitive, and none of the Developer, the City,
the City’s Financial Advisor, or the Underwriter can give any assurance that the building programs which are planned
throughout the District will be completed in accordance with the Developer’s expectations. The successful
development of the land within the District, the success of the Development, and the sale of residential units therein,
once such homes are built, may be affected by unforeseen changes in general economic conditions, fluctuations in the
real estate market, and other factors beyond the control of the Developer. The competitive position of the Developer
in the sale of developed lots or of any homebuilder in the sale of single-family residential units is affected by most of
the factors discussed in this section, and such competitive position is directly related to maintenance of market values
in Improvement Area #1 of the District.
There can be no assurances that other similar projects will not be developed in the future or that existing
projects will not be upgraded or otherwise become able to compete with the Development. Below is a list of
competitive projects in the area as of September 2025.
Pro ect Name Develope
Approximate
distance from
Distric
Year
Starte
Number of
Single-Family
Units
Approximate
Number of Units
Remainin
Home
Prices
Hurricane Creek Centurion
American 1 mile 2020 1,851 1,196 $567,000+
Meadow Vista Bloomfield 3 miles 2024 731 731 $529,000+
West Crossing Bloomfield 3 miles 2006 1,114 33 $587,000+
Source: The Developer
Lien Foreclosure and Bankruptcy
The payment of Improvement Area #1 Assessments and the ability of the City to foreclose on the lien of a
delinquent unpaid Improvement Area #1 Assessment may be limited by bankruptcy, insolvency or other laws
generally affecting creditors’ rights or by the laws of the State relating to judicial foreclosure. Although bankruptcy
proceedings would not cause the Improvement Area #1 Assessments to become extinguished, bankruptcy of a property
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owner in all likelihood would result in a delay in prosecuting foreclosure proceedings. Such a delay would increase
the likelihood of a delay or default in payment of the principal of and interest on the Bonds, and the possibility that
delinquent Improvement Area #1 Assessments might not be paid in full. See “OVERLAPPING TAXES AND DEBT.”
Direct and Overlapping Indebtedness, Improvement Area #1 Assessments and Taxes
The ability of an owner of Improvement Area #1 Assessed Property to pay the Improvement Area #1
Assessments could be affected by the existence of other taxes and assessments imposed upon the property. Public
entities whose boundaries overlap those of Improvement Area #1 currently impose ad valorem taxes on the property
within Improvement Area #1 and will likely do so in the future. Such entities could also impose assessment liens on
the property within Improvement Area #1. The imposition of additional liens, whether from taxes, assessments, or for
private financing, may reduce the ability or willingness of the landowners to pay the Improvement Area #1
Assessments. See “OVERLAPPING TAXES AND DEBT.”
Depletion of Accounts of the Reserve Fund; No Prefunding of Delinquency and Prepayment Reserve Account
Failure of the owners of property within Improvement Area #1 of the District to pay the Improvement Area
1 Assessments when due could result in the rapid, total depletion of the accounts in the Reserve Fund prior to
replenishment from the resale of property upon a foreclosure or otherwise or delinquency redemptions after a
foreclosure sale, if any. There could be a default in payments of the principal of and interest on the Bonds if sufficient
amounts are not available in the Reserve Fund. The Delinquency and Prepayment Reserve Account of the Reserve
Fund is not funded from proceeds of the Bonds. Instead, funding of the Delinquency and Prepayment Reserve Account
is accumulated over time, by the mechanism described in “SECURITY FOR THE BONDS – Reserve Fund (Reserve
Account and Delinquency and Prepayment Reserve Account).”
The Indenture provides that if after a withdrawal from the Reserve Account the amounts therein are less than
the Reserve Account Requirement, the Trustee shall transfer an amount from the Pledged Revenue Fund to the Reserve
Account sufficient to cure such deficiency. The Indenture also provides that if the amount on deposit in the
Delinquency and Prepayment Reserve Account shall at any time be less than the Delinquency and Prepayment Reserve
Requirement, the Trustee shall notify the City, in writing, of the amount of such shortfall and the City shall resume
collecting the Additional Interest and shall file a City Certificate with the Trustee instructing the Trustee to resume
depositing the Additional Interest from the Bond Pledged Revenue Account of the Pledged Revenue Fund into the
Delinquency and Prepayment Reserve Account until the Delinquency and Prepayment Reserve Requirement has been
accumulated in the Delinquency and Prepayment Reserve Account; provided, however, that the City shall not be
required to replenish the Delinquency and Prepayment Reserve Account in the event funds are transferred from the
Delinquency and Prepayment Reserve Account to the Redemption Fund as a result of an extraordinary optional
redemption of Bonds from the proceeds of a Prepayment, as described under “SECURITY FOR THE BONDS –
Reserve Fund (Reserve Account and Delinquency and Prepayment Reserve Account ).”
Hazardous Substances
While governmental taxes, assessments and charges are a common claim against the value of a parcel, other
less common claims may be relevant. One of the most serious in terms of the potential reduction in the value that may
be realized to the assessment is a claim with regard to a hazardous substance. In general, the owners and operators of
a parcel may be required by law to remedy conditions relating to releases or threatened releases of hazardous
substances. The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980,
sometimes referred to as “CERCLA” or “Superfund Act,” is the most well-known and widely applicable of these laws.
It is likely that, should any of the parcels of land located in the District be affected by a hazardous substance, the
marketability and value of parcels would be reduced by the costs of remedying the condition, because the purchaser,
upon becoming owner, will become obligated to remedy the condition just as is the seller.
The value of the land within the District does not consider the possible liability of the owner (or operator) for
the remedy of a hazardous substance condition of the parcel. The City has not independently verified, and is not aware,
that the owner (or operator) of any of the parcels within the District has such a current liability with respect to such
parcel; however, it is possible that such liabilities do currently exist and that the City is not aware of them.
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Further, it is possible that liabilities may arise in the future with respect to any of the land within the District
resulting from the existence, currently, of a substance presently classified as hazardous but which has not been released
or the release of which is not presently threatened, or may arise in the future resulting from the existence, currently,
on the parcel of a substance not presently classified as hazardous but which may in the future be so classified. Further,
such liabilities may arise not simply from the existence of a hazardous substance but from the method of handling it.
All of these possibilities could significantly affect the value of a parcel that is realizable upon a foreclosure.
See “THE DEVELOPMENT — Environmental” for discussion of the Phase One ESA performed on the
property within the District.
Regulation
Development within the District may be subject to future federal, state and local regulations. Approval may
be required from various agencies from time to time in connection with the layout and design of development in the
District, the nature and extent of public improvements, land use, zoning and other matters. Failure to meet any such
regulations or obtain any such approvals in a timely manner could delay or adversely affect development in the District
and property values.
Availability of Utilities
The progress of development within Improvement Area #1 of the District is also dependent upon the City
providing an adequate supply of water and wastewater service to the Development. If the City fails to provide water
and wastewater services to the property in the District, the Development cannot be substantially completed, and the
Developer will not be able to construct homes. See “THE CITY – Water and Wastewater.”
Flood Plain and Risk from Weather Events
According to the FEMA Flood Insurance Rate Map, Community Panel Number 48085C0155J, effective June
2, 2009, all of the property within the District lies outside of the 100-year and 500-year flood plain, referred to as Zone
X. FEMA will from time to time revise its Flood Insurance Rate Maps. None of the City, the Underwriter, or the
Developer make any representation as to whether FEMA may revise its Flood Insurance Rate Maps, whether such
revisions may result in homes that are currently outside of the 100-year and 500-year flood plain from being included
in the 100-year or 500-year flood plain in the future, or whether extreme flooding events may occur more often than
assumed in creating the rate maps.
All of the State, including the City, is subject to extreme weather events that can cause loss of life and damage
to property through strong winds, wildfires, hurricanes, tropical storms, flooding, heavy rains and freezes, including
events similar to the severe winter storm that the continental United States experienced in February 2021, which
resulted in disruptions in the Electric Reliability Council of Texas power grid and prolonged blackouts throughout the
State. It is impossible to predict whether similar events will occur in the future and the impact they may have on the
City, including land within the District.
Exercise of Third-Party Property Rights
As described herein under “THE DEVELOPMENT – Existing Mineral Rights,” there are certain mineral
rights reservations located within the District not owned by the Developer. There may also be additional mineral rights
and related real property rights reflected in the chain of title for the real property within the District recorded in the
real property records of the County.
The Developer does not expect the existence or exercise of any mineral rights or related real property rights
in or around the District to have a material adverse effect on the Development, the property within the District, or the
ability of landowners within the District to pay Improvement Area #1 Assessments. However, the Developer provides
no representations, warranties or other assurances with respect to the existence or exercise of any mineral rights or
related real property rights in or around the District. Furthermore, none of the City, the Financial Advisor, or the
Underwriter provide any assurances as to such Developer’s expectations.
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Bondholders’ Remedies and Bankruptcy of Property Owners
In the event of default in the payment of principal of or interest on the Bonds or the occurrence of any other
Event of Default under the Indenture, the Trustee may proceed, and upon the written request of the Owners of not less
than 51% in aggregate Outstanding principal amount of the Bonds under the Indenture shall proceed, to protect and
enforce the rights of the Owners under the Indenture, by action seeking mandamus or by other suit, action, or special
proceeding in equity or at law, in any court of competent jurisdiction, for any relief to the extent permitted by
Applicable Laws, including, but not limited to, the specific performance of any covenant or agreement contained in
the Indenture, or injunction; provided, however, that no action for money damages against the City may be sought or
shall be permitted.
The issuance of a writ of mandamus may be sought if there is no other available remedy at law to compel
performance of the City’s obligations under the Bonds or the Indenture and such obligations are not uncertain or
disputed. The remedy of mandamus is controlled by equitable principles, so its use rests within the discretion of the
court, but may not be arbitrarily refused. There is no acceleration of maturity of the Bonds in the event of default and,
consequently, the remedy of mandamus may have to be relied upon from year to year. The owners of the Bonds cannot
themselves foreclose on property within Improvement Area #1 or sell property within Improvement Area #1 in order
to pay the principal of and interest on the Bonds. The enforceability of the rights and remedies of the owners of the
Bonds further may be limited by laws relating to bankruptcy, reorganization or other similar laws of general
application affecting the rights of creditors of political subdivisions such as the City. In this regard, should the City
file a petition for protection from creditors under federal bankruptcy laws, the remedy of mandamus or the right of the
City to seek judicial foreclosure of its Assessment Lien would be automatically stayed and could not be pursued unless
authorized by a federal bankruptcy judge. See “BONDHOLDERS’ RISKS – Chapter 9 Bankruptcy Limitation to
Bondholders’ Rights” herein.
Any bankruptcy court with jurisdiction over bankruptcy proceedings initiated by or against a property owner
within the District pursuant to the Federal Bankruptcy Code could, subject to its discretion, delay or limit any attempt
by the City to collect delinquent Improvement Area #1 Assessments, or delinquent ad valorem taxes, against such
property owner.
In addition, in 2006, the Texas Supreme Court ruled in Tooke v. City of Mexia, 197 S.W.3d 325 (Tex. 2006)
Tooke”) that a waiver of sovereign immunity must be provided for by statute in “clear and unambiguous” language.
In so ruling, the Court declared that statutory language such as “sue and be sued”, in and of itself, did not constitute a
clear and unambiguous waiver of sovereign immunity. In Tooke, the Court noted the enactment in 2005 of sections
271.151-.160, Texas Local Government Code (the “Local Government Immunity Waiver Act”), which, according to
the Court, waives “immunity from suit for contract claims against most local governmental entities in certain
circumstances.” The Local Government Immunity Waiver Act covers cities and relates to contracts entered into by
cities for providing goods or services to cities.
In Wasson Interests, Ltd. v. City of Jacksonville, 489 S.W.3d 427 (Tex. 2016) (“Wasson”), the Texas
Supreme Court (the “Court”) addressed whether the distinction between governmental and proprietary acts (as found
in tort- based causes of action) applies to breach of contract claims against municipalities. The Court analyzed the
rationale behind the Proprietary-Governmental Dichotomy to determine that “a city’s proprietary functions are not
done pursuant to the ‘will of the people’” and protecting such municipalities “via the [S]tate’s immunity is not an
efficient way to ensure efficient allocation of [S]tate resources.” While the Court recognized that the distinction
between governmental and proprietary functions is not clear, the Wasson opinion held that the Proprietary-
Governmental Dichotomy applies in a contract-claims context. The Court reviewed Wasson for a second time and
issued an opinion on October 5, 2018 clarifying that to determine whether governmental immunity applies to a breach
of contract claim, the proper inquiry is whether the municipality was engaged in a governmental or proprietary
function when it entered into the contract, not at the time of the alleged breach. Therefore, in regard to municipal
contract cases (as in tort claims), it is incumbent on the courts to determine whether a function was proprietary or
governmental based upon the statutory and common law guidance at the time of inception of the contractual
relationship. Texas jurisprudence has generally held that proprietary functions are those conducted by a city in its
private capacity, for the benefit only of those within its corporate limits, and not as an arm of the government or under
authority or for the benefit of the State; these are usually activities that can be, and often are, provided by private
persons, and therefore are not done as a branch of the State, and do not implicate the state’s immunity since they are
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not performed under the authority, or for the benefit, of the State as sovereign. Notwithstanding the foregoing new
case law issued by the Court, such sovereign immunity issues have not been adjudicated in relation to bond matters
specifically, in regard to the issuance of municipal debt). Each situation will be prospectively evaluated based on the
facts and circumstances surrounding the contract in question to determine if a suit, and subsequently, a judgement, is
justiciable against a municipality.
The City is not aware of any State court construing the Local Government Immunity Waiver Act in the
context of whether contractual undertakings of local governments that relate to their borrowing powers are contracts
covered by such act. Because it is unclear whether the Texas legislature has effectively waived the City’s sovereign
immunity from a suit for money damages in the absence of City action, the Trustee or the owners of the Bonds may
not be able to bring such a suit against the City for breach of the Bonds or the Indenture covenants. As noted above,
the Indenture provides that owners of the Bonds may exercise the remedy of mandamus to enforce the obligations of
the City under the Indenture. Neither the remedy of mandamus nor any other type of injunctive relief was at issue in
Tooke, and it is unclear whether Tooke will be construed to have any effect with respect to the exercise of mandamus,
as such remedy has been interpreted by State courts. In general, State courts have held that a writ of mandamus may
be issued to require public officials to perform ministerial acts that clearly pertain to their duties. State courts have
held that a ministerial act is defined as a legal duty that is prescribed and defined with a precision and certainty that
leaves nothing to the exercise of discretion or judgment, though mandamus is not available to enforce purely
contractual duties. However, mandamus may be used to require a public officer to perform legally-imposed ministerial
duties necessary for the performance of a valid contract to which the State or a political subdivision of the State is a
party (including the payment of moneys due under a contract).
Judicial Foreclosures
Judicial foreclosure proceedings are not mandatory; however, the City has covenanted (subject to provisions
set forth in the Indenture) to order and cause such actions to be commenced. In the event a foreclosure is necessary,
there could be a delay in payments to owners of the Bonds pending prosecution of the foreclosure proceedings and
receipt by the City of the proceeds of the foreclosure sale. It is possible that no bid would be received at the foreclosure
sale, and, in such event, there could be an additional delay in payment of the principal of and interest on the Bonds or
such payment may not be made in full. Moreover, in filing a suit to foreclose, the City must join other taxing units
that have claims for delinquent taxes against all or part of the same property; the proceeds of any sale of property
within Improvement Area #1 available to pay debt service on the Bonds may be limited by the existence of other tax
liens on the property. See “OVERLAPPING TAXES AND DEBT.” Collection of delinquent taxes, assessments and
Improvement Area #1 Assessments may be adversely affected by the effects of market conditions on the foreclosure
sale price, and by other factors, including taxpayers’ right to redeem property within two years of foreclosure for
residential and agricultural use property and six months for other property, and by a time-consuming and expensive
collection procedure.
No Acceleration
The Indenture expressly denies the right of acceleration in the event of a payment default or other default
under the terms of the Bonds or the Indenture.
Limited Secondary Market for the Bonds
The Bonds may not constitute a liquid investment, and there is no assurance that a liquid secondary market
will exist for the Bonds in the event an Owner thereof determines to solicit purchasers for the Bonds. Even if a liquid
secondary market exists, there can be no assurance as to the price for which the Bonds may be sold. Such price may
be lower than that paid by the current Owners of the Bonds, depending on the progress of development of Improvement
Area #1 subject to the Improvement Area #1 Assessments, existing real estate and financial market conditions and
other factors.
No Credit Rating
The City has not applied for or received a rating on the Bonds. Even if a credit rating had been sought for the
Bonds, it is not anticipated that such a rating would have been investment grade. The absence of a rating could affect
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the future marketability of the Bonds. There is no assurance that a secondary market for the Bonds will develop or
that holders who desire to sell their Bonds prior to the stated maturity will be able to do so. Occasionally, because of
general market conditions or because of adverse history or economic prospects connected with a particular issue,
secondary market trading in connection with a particular issue is suspended or terminated. Additionally, prices of
issues for which a market is being made will depend upon then generally prevailing circumstances. Such prices could
be substantially different from the original purchase price.
Chapter 9 Bankruptcy Limitation to Bondholders’ Rights
The enforceability of the rights and remedies of the owners of the Bonds may be limited by laws relating to
bankruptcy, reorganization or other similar laws of general application affecting the rights of creditors of political
subdivisions such as the City. The City is authorized under State law to voluntarily proceed under Chapter 9 of the
Federal Bankruptcy Code, 11 U.S.C. 901-946. The City may proceed under Chapter 9 if it (1) is generally not paying
its debts, or unable to meet its debts, as they become due, (2) desires to effect a plan to adjust such debts, and (3) has
either obtained the agreement of or negotiated in good faith with its creditors, is unable to negotiate with its creditors
because negotiation is impracticable, or reasonably believes that a creditor may attempt to obtain a preferential
transfer.
If the City decides in the future to proceed voluntarily under the Federal Bankruptcy Code, the City would
develop and file a plan for the adjustment of its debts, and the Bankruptcy Court would confirm the plan if (1) the plan
complies with the applicable provisions of the Federal Bankruptcy Code, (2) all payments to be made in connection
with the plan are fully disclosed and reasonable, (3) the City is not prohibited by law from taking any action necessary
to carry out the plan, (4) administrative expenses are paid in full, (5) all regulatory or electoral approvals required
under State law are obtained and (6) the plan is in the best interests of creditors and is feasible. The rights and remedies
of the owners of the Bonds would be adjusted in accordance with the confirmed plan of adjustment of the City’s debt.
The City cannot predict a Bankruptcy Court’s treatment of the Bondholders’ creditor claim and whether a Bondholder
would be repaid in full.
Tax-Exempt Status of the Bonds
The Indenture contains covenants by the City intended to preserve the exclusion from gross income of interest
on the Bonds for federal income tax purposes. As discussed under the caption “TAX MATTERS,” interest on the
Bonds could become includable in gross income for purposes of federal income taxation retroactive to the date the
Bonds were issued as a result of future acts or omissions of the City in violation of its covenants in the Indenture.
Tax legislation, administrative actions taken by tax authorities, or court decisions, whether at the federal or
State level, may adversely affect the tax-exempt status of interest on the Bonds under federal or State law and could
affect the market price or marketability of the Bonds. Any such proposal could limit the value of certain deductions
and exclusions, including the exclusion for tax-exempt interest. The likelihood of any such proposal being enacted
cannot be predicted. Prospective purchasers of the Bonds should consult their own tax advisors regarding the foregoing
matters.
As further described in “TAX MATTERS” below, failure of the City to comply with the requirements of the
Internal Revenue Code of 1986 (the “Code”) and the related legal authorities, or changes in the federal tax law or its
application, could cause interest on the Bonds to be included in the gross income of owners of the Bonds for federal
income tax purposes, possibly from the date of original issuance of the Bonds. Further, the opinion of Bond Counsel
is based on current legal authority, covers certain matters not directly addressed by such authorities, and represents
Bond Counsel’s judgment as to the proper treatment of interest on the Bonds for federal income tax purposes. It is not
binding on the Internal Revenue Service (“IRS”) or the courts. The IRS has an ongoing program of auditing obligations
that are issued and sold as bearing tax-exempt interest to determine whether, in the view of the IRS, interest on such
obligations is included in the gross income of the owners thereof for federal income tax purposes. In the past, the IRS
has announced audit efforts focused in part on “developer-driven bond transactions,” including certain tax increment
financings and certain assessment bond transactions. It cannot be predicted if this IRS focus could lead to an audit of
the Bonds or what the result would be of any such audit. If an audit of the Bonds is commenced, under current
procedures parties other than the City would have little, if any, right to participate in the audit process. Moreover,
because achieving judicial review in connection with an audit of tax-exempt obligations is difficult, obtaining an
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independent review of IRS positions with which the City legitimately disagrees may not be practicable. Any action of
the IRS, regardless of the outcome, including but not limited to selection of the Bonds for audit, or the course or result
of such audit, or an audit of obligations presenting similar tax issues, may affect the market price for, or the
marketability of, the Bonds. Finally, if the IRS ultimately determines that the interest on the Bonds is not excluded
from the gross income of Bondholders for federal income tax purposes, the City may not have the resources to settle
with the IRS, the Bonds are not required to be redeemed, and the interest rate on the Bonds will not increase.
Management and Ownership
The management and ownership of the Developer could change in the future. Purchasers of the Bonds should
not rely on the management experience of such entities. There are no assurances that such entities will not sell the
subject property or that officers will not resign or be replaced. In such circumstances, a new developer or new officers
in management positions may not have comparable experience in projects comparable to the Development.
Dependence Upon Developer
The Developer will own all of the Improvement Area #1 Assessed Property in Improvement Area #1 until
homes begin to be sold to homebuyers. Therefore, until the Developer sells homes within Improvement Area #1, the
Developer will have the obligation for payment of the Improvement Area #1 Annual Installments. The ability of the
Developer to make full and timely payment of the Improvement Area #1 Assessments will directly affect the ability
of the City to meet its debt service obligations with respect to the Bonds.
Use of Appraisal
Caution should be exercised in the evaluation and use of appraisal results. An appraisal is an estimate of
market value as of a specified date based upon assumptions and limiting conditions and any extraordinary assumptions
specific to the relevant valuation and specified therein. The estimated market value specified in the Appraisal is not a
precise measure of value but is based on a subjective comparison of related activity taking place in the real estate
market. The valuation set forth in the Appraisal is based on various assumptions of future expectations and while the
Appraiser’s forecasts for the properties in the District is considered by the Appraiser to be reasonable at the current
time, some of the assumptions may not materialize or may differ materially from actual experience in the future.
The Bonds will not necessarily trade at values determined solely by reference to the underlying value of the
properties in the District.
In performing its analyses, an appraiser makes numerous assumptions with respect to general business,
economic and regulatory conditions, and other matters, many of which are beyond the Appraiser’s, Underwriter’s,
and City’s control, as well as to certain factual matters. Furthermore, the Appraiser’s analysis, opinions and
conclusions are necessarily based upon market, economic, financial, and other circumstances and conditions existing
prior to the valuation and date of the Appraisal.
The intended use and user of the Appraisal are specifically identified in the Appraisal as agreed upon in the
contract for services and/or reliance language found in the Appraisal. The Appraiser has consented to the use of the
Appraisal in this Limited Offering Memorandum in connection with the issuance of the Bonds. No other use or user
of the Appraisal is permitted by any other party for any other purpose.
Agricultural Use Valuation and Redemption Rights
The property in the District, including Improvement Area #1, is currently entitled to valuation for ad valorem
tax purposes based upon its agricultural use. The Developer expects that property will be removed from agricultural
valuation as development progresses and that the property within Improvement Area #1 will no longer be subject to
agricultural valuation beginning in 2026. Under State law, an owner of land that is entitled to an agricultural valuation
has the right to redeem such property after a tax sale for a period of two years after the tax sale by paying to the tax
sale purchaser a 25% premium, if redeemed during the first year, or a 50% premium, if redeemed during the second
year, over the purchase price paid at the tax sale and certain qualifying costs incurred by the purchaser. Although the
Improvement Area #1 Assessments are not considered a tax under State law, the PID Act provides that the lien for the
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Improvement Area #1 Assessments may be enforced in the same manner as a lien for ad valorem taxes. This shared
enforcement mechanism raises a possibility that the right to redeem agricultural valuation property may be available
following a foreclosure of a lien for the Improvement Area #1 Assessments, though there is no indication in State law
that such redemption rights would be available in such a case.
TAX MATTERS
Opinion
On the date of initial delivery of the Bonds, McCall, Parkhurst & Horton L.L.P., Dallas, Texas, Bond Counsel
to the City, will render its opinion that, in accordance with statutes, regulations, published rulings and court decisions
existing on the date thereof (“Existing Law”), (1) interest on the Bonds for federal income tax purposes will be
excludable from the “gross income” of the holders thereof and (2) the Bonds will not be treated as “specified private
activity bonds” the interest on which would be included as an alternative minimum tax preference item under section
57(a)(5) of the Internal Revenue Code of 1986 (the “Code”). Except as stated above, Bond Counsel to the City will
express no opinion as to any other federal, state, or local tax consequences of the purchase, ownership, or disposition
of the Bonds. See “APPENDIX D – Form of Bond Counsel Opinion.”
In rendering its opinion, Bond Counsel to the City will rely upon (a) certain information and representations
of the City, including information and representations contained in the City’s federal tax certificate, and (b) covenants
of the City contained in the Bond documents relating to certain matters, including arbitrage and the use of the proceeds
of the Bonds and the property financed or refinanced therewith. Failure by the City to observe the aforementioned
representations or covenants could cause the interest on the Bonds to become taxable retroactively to the date of
issuance.
The Code and the regulations promulgated thereunder contain a number of requirements that must be satisfied
subsequent to the issuance of the Bonds in order for interest on the Bonds to be, and to remain, excludable from gross
income for federal income tax purposes. Failure to comply with such requirements may cause interest on the Bonds
to be included in gross income retroactively to the date of issuance of the Bonds. The opinion of Bond Counsel to the
City is conditioned on compliance by the City with such requirements, and Bond Counsel to the City has not been
retained to monitor compliance with these requirements subsequent to the issuance of the Bonds.
Bond Counsel’s opinion represents its legal judgment based upon its review of Existing Law and the reliance
on the aforementioned information, representations and covenants. Bond Counsel’s opinion is not a guarantee of a
result. Existing Law is subject to change by the Congress and to subsequent judicial and administrative interpretation
by the courts and the Department of the Treasury. There can be no assurance that Existing Law or the interpretation
thereof will not be changed in a manner which would adversely affect the tax treatment of the purchase, ownership or
disposition of the Bonds.
A ruling was not sought from the Internal Revenue Service by the City with respect to the Bonds or the
property financed or refinanced with proceeds of the Bonds. No assurances can be given as to whether the Internal
Revenue Service will commence an audit of the Bonds, or as to whether the Internal Revenue Service would agree
with the opinion of Bond Counsel. If an Internal Revenue Service audit is commenced, under current procedures the
Internal Revenue Service is likely to treat the City as the taxpayer and the Bondholders may have no right to participate
in such procedure. No additional interest will be paid upon any determination of taxability.
Federal Income Tax Accounting Treatment of Original Issue Discount
The initial public offering price to be paid for one or more maturities of the Bonds may be less than the
principal amount thereof or one or more periods for the payment of interest on the bonds may not be equal to the
accrual period or be in excess of one year (the “Original Issue Discount Bonds”). In such event, the difference between
i) the “stated redemption price at maturity” of each Original Issue Discount Bond, and (ii) the initial offering price to
the public of such Original Issue Discount Bond would constitute original issue discount. The “stated redemption price
at maturity” means the sum of all payments to be made on the bonds less the amount of all periodic interest payments.
Periodic interest payments are payments which are made during equal accrual periods (or during any unequal period
if it is the initial or final period) and which are made during accrual periods which do not exceed one year.
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Under existing law, any owner who has purchased such Original Issue Discount Bond in the initial public
offering is entitled to exclude from gross income (as defined in section 61 of the Code) an amount of income with
respect to such Original Issue Discount Bond equal to that portion of the amount of such original issue discount
allocable to the accrual period. For a discussion of certain collateral federal tax consequences, see discussion set forth
below.
In the event of the redemption, sale or other taxable disposition of such Original Issue Discount Bond prior
to stated maturity, however, the amount realized by such owner in excess of the basis of such Original Issue Discount
Bond in the hands of such owner (adjusted upward by the portion of the original issue discount allocable to the period
for which such Original Issue Discount Bond was held by such initial owner) is includable in gross income.
Under existing law, the original issue discount on each Original Issue Discount Bond is accrued daily to the
stated maturity thereof (in amounts calculated as described below for each six-month period ending on the date before
the semiannual anniversary dates of the date of the Bonds and ratably within each such six-month period) and the
accrued amount is added to an initial owner’s basis for such Original Issue Discount Bond for purposes of determining
the amount of gain or loss recognized by such owner upon the redemption, sale or other disposition thereof. The
amount to be added to basis for each accrual period is equal to (a) the sum of the issue price and the amount of original
issue discount accrued in prior periods multiplied by the yield to stated maturity (determined on the basis of
compounding at the close of each accrual period and properly adjusted for the length of the accrual period) less (b)
the amounts payable as current interest during such accrual period on such Original Issue Discount Bond.
The federal income tax consequences of the purchase, ownership, redemption, sale or other disposition of
Original Issue Discount Bonds which are not purchased in the initial offering at the initial offering price may be
determined according to rules which differ from those described above. All owners of Original Issue Discount Bonds
should consult their own tax advisors with respect to the determination for federal, state and local income tax purposes
of the treatment of interest accrued upon redemption, sale or other disposition of such Original Issue Discount Bonds
and with respect to the federal, state, local and foreign tax consequences of the purchase, ownership, redemption, sale
or other disposition of such Original Issue Discount Bonds.
Collateral Federal Income Tax Consequences
The following discussion is a summary of certain collateral federal income tax consequences resulting from
the purchase, ownership or disposition of the Bonds. This discussion is based on existing statutes, regulations,
published rulings and court decisions, all of which are subject to change or modification, retroactively.
The following discussion is applicable to investors, other than those who are subject to special provisions of
the Code, such as financial institutions, property and casualty insurance companies, life insurance companies,
individual recipients of Social Security or Railroad Retirement benefits, individuals allowed an earned income credit,
certain S corporations with Subchapter C earnings and profits, foreign corporations subject to the branch profits tax,
taxpayers qualifying for the health insurance premium assistance credit and taxpayers who may be deemed to have
incurred or continued indebtedness to purchase tax-exempt obligations.
THE DISCUSSION CONTAINED HEREIN MAY NOT BE EXHAUSTIVE. INVESTORS, INCLUDING
THOSE WHO ARE SUBJECT TO SPECIAL PROVISIONS OF THE CODE, SHOULD CONSULT THEIR OWN
TAX ADVISORS AS TO THE TAX TREATMENT WHICH MAY BE ANTICIPATED TO RESULT FROM THE
PURCHASE, OWNERSHIP AND DISPOSITION OF TAX-EXEMPT OBLIGATIONS BEFORE DETERMINING
WHETHER TO PURCHASE THE BONDS.
Interest on the Bonds may be includable in certain corporation’s “adjusted financial statement income”
determined under section 56A of the Code to calculate the alternative minimum tax imposed by section 55 of the
Code.
Under section 6012 of the Code, holders of tax-exempt obligations, such as the Bonds, may be required to
disclose interest received or accrued during each taxable year on their returns of federal income taxation.
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Section 1276 of the Code provides for ordinary income tax treatment of gain recognized upon the disposition
of a tax-exempt obligation, such as the Bonds, if such obligation was acquired at a “market discount” and if the fixed
maturity of such obligation is equal to, or exceeds, one year from the date of issue. Such treatment applies to “market
discount bonds” to the extent such gain does not exceed the accrued market discount of such bonds; although for this
purpose, a de minimis amount of market discount is ignored. A “market discount bond” is one which is acquired by
the holder at a purchase price which is less than the stated redemption price at maturity or, in the case of a bond issued
at an original issue discount, the “revised issue price” (i.e., the issue price plus accrued original issue discount). The
accrued market discount” is the amount which bears the same ratio to the market discount as the number of days
during which the holder holds the obligation bears to the number of days between the acquisition date and the final
maturity date.
State, Local And Foreign Taxes
Investors should consult their own tax advisors concerning the tax implications of the purchase, ownership
or disposition of the Bonds under applicable state or local laws. Foreign investors should also consult their own tax
advisors regarding the tax consequences unique to investors who are not United States persons.
Information Reporting and Backup Withholding
Subject to certain exceptions, information reports describing interest income, including original issue
discount, with respect to the Bonds will be sent to each registered holder and to the Internal Revenue Service.
Payments of interest and principal may be subject to backup withholding under section 3406 of the Code if a recipient
of the payments fails to furnish to the payor such owner's social security number or other taxpayer identification
number (“TIN”), furnishes an incorrect TIN, or otherwise fails to establish an exemption from the backup withholding
tax. Any amounts so withheld would be allowed as a credit against the recipient’s federal income tax. Special rules
apply to partnerships, estates and trusts, and in certain circumstances, and in respect of foreign investors, certifications
as to foreign status and other matters may be required to be provided by partners and beneficiaries thereof.
Future and Proposed Legislation
Tax legislation, administrative actions taken by tax authorities, or court decisions, whether at the Federal or
state level, may adversely affect the tax-exempt status of interest on the Bonds under Federal or state law and could
affect the market price or marketability of the Bonds. Any such proposal could limit the value of certain deductions
and exclusions, including the exclusion for tax-exempt interest. The likelihood of any such proposal being enacted
cannot be predicted. Prospective purchasers of the Bonds should consult their own tax advisors regarding the foregoing
matters.
LEGAL MATTERS
Legal Proceedings
Delivery of the Bonds will be accompanied by (i) the unqualified approving legal opinion of the Attorney
General to the effect that the Bonds are valid and legally binding obligations of the City under the Constitution and
laws of the State, payable from the Trust Estate and, (ii) based upon their examination of a transcript of certified
proceedings relating to the issuance and sale of the Bonds, the legal opinion of Bond Counsel, to a like effect.
McCall, Parkhurst & Horton L.L.P., serves as Bond Counsel to the City. Norton Rose Fulbright US LLP
serves as Underwriter’s Counsel. The legal fees paid to Bond Counsel and Underwriter’s Counsel are contingent upon
the sale and delivery of the Bonds.
Legal Opinions
The City will furnish the Underwriter a transcript of certain certified proceedings incident to the authorization
and issuance of the Bonds. Such transcript will include a certified copy of the approving opinion of the Attorney
General of Texas, as recorded in the Bond Register of the Comptroller of Public Accounts of the State, to the effect
that the Bonds are valid and binding special obligations of the City. The City will also furnish the legal opinion of
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Bond Counsel, to the effect that, based upon an examination of such transcript, the Bonds are valid and binding special
obligations of the City under the Constitution and laws of the State. The legal opinion of Bond Counsel will further
state that the Bonds, including principal thereof and interest thereon, are payable from and secured by a first lien on,
security interest in, and pledge of the Trust Estate. Bond Counsel will also provide a legal opinion to the effect that
interest on the Bonds will be excludable from gross income for federal income tax purposes under Section 103(a) of
the Code, subject to the matters described above under the caption “TAX MATTERS,” including the alternative
minimum tax consequences for corporations. A copy of the opinion of Bond Counsel is attached hereto as
APPENDIX D – Form of Bond Counsel Opinion.”
Except as noted below, Bond Counsel did not take part in the preparation of the Limited Offering
Memorandum, and such firm has not assumed any responsibility with respect thereto or undertaken independently to
verify any of the information contained therein, except that, in its capacity as Bond Counsel, such firm has reviewed
the information describing the Bonds in the Limited Offering Memorandum under the captions or subcaptions “PLAN
OF FINANCE – The Bonds,” “DESCRIPTION OF THE BONDS,” “SECURITY FOR THE BONDS,”
ASSESSMENT PROCEDURES” (except for the subcaptions “Assessment Methodology” and “Improvement Area
1 Assessment Amounts”), “THE DISTRICT,” “TAX MATTERS,” “LEGAL MATTERS – Legal Proceedings” (first
paragraph only), “LEGAL MATTERS – Legal Opinions,” “SUITABILITY FOR INVESTMENT,” “CONTINUING
DISCLOSURE – The City,” “REGISTRATION AND QUALIFICATION OF BONDS FOR SALE,” “LEGAL
INVESTMENTS AND ELIGIBILITY TO SECURE PUBLIC FUNDS IN TEXAS” and “APPENDIX B” and such
firm is of the opinion that the information relating to the Bonds, the Bond Ordinance, the Assessment Ordinance, and
the Indenture contained therein fairly and accurately describes the laws and legal issues addressed therein and, with
respect to the Bonds, such information conforms to the Bond Ordinance, the Assessment Ordinance and the Indenture.
The various legal opinions to be delivered concurrently with the delivery of the Bonds express the
professional judgment of the attorneys rendering the opinions as to the legal issues explicitly addressed therein. In
rendering a legal opinion, the attorney does not become an insurer or guarantor of that expression of professional
judgment, of the transaction opined upon, or of the future performance of the parties to the transaction. Nor does the
rendering of an opinion guarantee the outcome of any legal dispute that may arise out of the transaction.
Litigation – The City
At the time of delivery and payment for the Bonds, the City will certify that, except as disclosed herein, 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 or overtly threatened against the City affecting the existence of the District, or seeking
to restrain or to enjoin the sale or delivery of the Bonds, the application of the proceeds thereof, in accordance with
the Indenture, or the collection or application of Improvement Area #1 Assessments securing the Bonds, or in any
way contesting or affecting the validity or enforceability of the Bonds, the Assessment Ordinance, the Indenture, any
action of the City contemplated by any of the said documents, or the collection or application of the Pledged Revenues,
or in any way contesting the completeness or accuracy of this Limited Offering Memorandum or any amendment or
supplement thereto, or contesting the powers of the City or its authority with respect to the Bonds or any action of the
City contemplated by any documents relating to the Bonds.
Litigation – The Developer
At the time of delivery and payment for the Bonds, the Developer will certify that, except as disclosed herein,
there is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory
body, public board or body pending, or, to the best knowledge of the Developer, threatened against or affecting the
Developer wherein an unfavorable decision, ruling or finding would have a material adverse effect on the financial
condition or operations of the Developer or its officers or would adversely affect (1) the transactions contemplated by,
or the validity or enforceability of, the Bonds, the Indenture, the Bond Ordinance, the Service and Assessment Plan,
the Development Agreement, the CFA Agreement, or the Bond Purchase Agreement, or otherwise described in this
Limited Offering Memorandum, or (2) the tax-exempt status of interest on the Bonds (individually or in the aggregate,
a “Material Adverse Effect”). Principals of the Developer and their affiliated entities may in the future be parties to
pending and/or threatened litigation related to their commercial and real estate development activities. Such litigation
occurs in the ordinary course of business and is not expected to have a Material Adverse Effect.
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SUITABILITY FOR INVESTMENT
Investment in the Bonds poses certain economic risks. See “BONDHOLDERS’ RISKS”. The Bonds are
not rated by any nationally recognized municipal securities rating service. No dealer, broker, salesman or other person
has been authorized by the City or the Underwriter to give any information or make any representations, other than
those contained in this Limited Offering Memorandum, and, if given or made, such other information or
representations must not be relied upon as having been authorized by either of the foregoing. Additional information
will be made available to each prospective investor, including the benefit of a site visit to the City and the opportunity
to ask questions of the Developer, as such prospective investor deems necessary in order to make an informed decision
with respect to the purchase of the Bonds.
ENFORCEABILITY OF REMEDIES
The remedies available to the owners of the Bonds upon an event of default under the Indenture are in many
respects dependent upon judicial actions, which are often subject to discretion and delay. See “BONDHOLDERS’
RISKS – Bondholders’ Remedies and Bankruptcy of Property Owners.” Under existing constitutional and statutory
law and judicial decisions, including the federal bankruptcy code, the remedies specified by the Indenture and the
Bonds may not be readily available or may be limited. The various legal opinions to be delivered concurrently with
the delivery of the Bonds will be qualified, as to the enforceability of the remedies provided in the various legal
instruments, by limitations imposed by governmental immunity, bankruptcy, reorganization, insolvency or other
similar laws affecting the rights of creditors and enacted before or after such delivery.
NO RATING
No application for a rating on the Bonds has been made to any rating agency, nor is there any reason to
believe that the City would have been successful in obtaining an investment grade rating for the Bonds had application
been made.
CONTINUING DISCLOSURE
The City
Pursuant to SEC Rule 15c2-12 (the “Rule”), the City, the Administrator, and Regions Bank (in such capacity,
the “Dissemination Agent”) will enter into a Continuing Disclosure Agreement of Issuer (the “Disclosure Agreement
of Issuer”) for the benefit of the Owners of the Bonds (including owners of beneficial interests in the Bonds), to
provide, by certain dates prescribed in the Disclosure Agreement of Issuer, certain financial information and operating
data relating to the City (collectively, the “City Reports”). The specific nature of the information to be contained in
the City Reports is set forth in “APPENDIX E-1 – Form of Disclosure Agreement of Issuer.” Under certain
circumstances, the failure of the City to comply with its obligations under the Disclosure Agreement of Issuer
constitutes an event of default thereunder. Such a default will not constitute an event of default under the Indenture,
but such event of default under the Disclosure Agreement of Issuer would allow the Owners of the Bonds (including
owners of beneficial interests in the Bonds) to bring an action for specific performance.
The City has agreed to update information and to provide notices of certain specified events only as provided
in the Disclosure Agreement of Issuer. The City has not agreed to provide other information that may be relevant or
material to a complete presentation of its financial results of operations, condition, or prospects or agreed to update
any information that is provided in this Limited Offering Memorandum, except as provided in the Disclosure
Agreement of Issuer. The City makes no representation or warranty concerning such information or concerning its
usefulness to a decision to invest in or sell the Bonds at any future date. The City disclaims any contractual or tort
liability for damages resulting in whole or in part from any breach of the Disclosure Agreement of Issuer or from any
statement made pursuant to the Disclosure Agreement of Issuer.
The City’s Compliance with Prior Undertakings
The City believes it has substantially complied in all material respects with its continuing disclosure
undertakings pursuant to the Rule during the last 5 years.
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The Developer
The Developer, the Administrator, and the Dissemination Agent have entered into a Continuing Disclosure
Agreement of Developer (the “Disclosure Agreement of Developer”) for the benefit of the Owners of the Bonds
including owners of beneficial interests in the Bonds), to provide, by certain dates prescribed in the Disclosure
Agreement of Developer, certain information regarding the Development and the Improvement Area #1 Projects
collectively, the “Developer Reports”). The specific nature of the information to be contained in the Developer
Reports is set forth in “APPENDIX E-2 – Form of Disclosure Agreement of Developer.” Under certain circumstances,
the failure of the Developer or the Administrator to comply with its obligations under the Disclosure Agreement of
Developer constitutes an event of default thereunder. Such a default will not constitute an event of default under the
Indenture, but such event of default under the Disclosure Agreement of Developer would allow the Owners of the
Bonds (including owners of beneficial interests in the Bonds) to bring an action for specific performance. The
Disclosure Agreement of Developer is a voluntary agreement made for the benefit of the holders of the Bonds and is
not entered into pursuant to the Rule.
The Developer has agreed to provide (i) certain updated information to the Administrator, which consultant
will prepare and provide such updated information in report form and (ii) notices of certain specified events, only as
provided in the Disclosure Agreement of Developer. The Developer has not agreed to provide other information that
may be relevant or material to a complete presentation of its financial results of operations, condition, or prospects or
agreed to update any information that is provided in this Limited Offering Memorandum, except as provided in the
Disclosure Agreement of Developer. The Developer makes no representation or warranty concerning such
information or concerning its usefulness to a decision to invest in or sell the Bonds at any future date. The Developer
disclaims any contractual or tort liability for damages resulting in whole or in part from any breach of the Disclosure
Agreement of Developer or from any statement made pursuant to the Disclosure Agreement of Developer.
The Developer’s Compliance with Prior Undertakings
Except as otherwise described herein, during the last five years, the Developer has complied in all material
respects with its continuing disclosure agreements.
In connection with the issuance of two series of bonds for Timberbrook Public Improvement District No. 1
Timberbrook PID #1”) issued in 2018, the Developer entered into two separate continuing disclosure agreements.
Such agreements contained conflicting deadlines for filing of quarterly reports with EMMA. All quarterly reports
were filed with EMMA by the later of the two conflicting deadlines. The conflict was discovered in 2021 and the
Developer has been in compliance with the 2018 continuing disclosure agreements since June 2021.
In connection with the 2021 issuance of bonds for Timberbrook PID #1 (the “Series 2021 Bonds”), the
Developer entered into a continuing disclosure agreement and a completion agreement, both of which required the
Developer to certify as to the sufficiency of the Evidence of Available Funds (as defined in the completion agreement
and provided at closing of the Series 2021 Bonds) to fund the completion of the improvements that were financed, in
part, with proceeds of the Series 2021 Bonds. Although the Developer has certified in its quarterly reports for the
Series 2021 Bonds as to the sufficiency of its available funds, generally, to fund such improvements, the quarterly
reports for the Series 2021 Bonds have not addressed the sufficiency of the Evidence of Available Funds specifically,
as required by the continuing disclosure agreement and the completion agreement. Beginning with its quarterly report
for the period ending March 31, 2024, the Developer included in its quarterly reports for the Series 2021 Bonds a copy
of the Evidence of Available Funds and a certification as to its sufficiency until termination of the completion
agreement.
UNDERWRITING
FMSbonds, Inc. (the “Underwriter”) has agreed to purchase the Bonds from the City at a purchase price of $
the par amount of the Bonds, less an underwriting discount of $ ). The Underwriter’s obligations are
subject to certain conditions precedent and if obligated to purchase any of the Bonds the Underwriter will be obligated
to purchase all of the Bonds. The Bonds may be offered and sold by the Underwriter at prices lower than the initial
offering prices stated on the inside cover page hereof, and such initial offering prices may be changed from time to
time by the Underwriter.
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REGISTRATION AND QUALIFICATION OF BONDS FOR SALE
The sale of the Bonds has not been registered under the Federal Securities Act of 1933, as amended, in
reliance upon the exemption provided thereunder by Section 3(a)(2); and the Bonds have not been qualified under the
Securities Act of Texas in reliance upon various exemptions contained therein; nor have the Bonds been qualified
under the securities acts of any other jurisdiction. The City assumes no responsibility for qualification of the Bonds
under the securities laws of any jurisdiction in which the Bonds may be sold, assigned, pledged, hypothecated or
otherwise transferred. This disclaimer of responsibility for qualification for sale or other disposition of the Bonds
shall not be construed as an interpretation of any kind with regard to the availability of any exemption from securities
registration provisions.
LEGAL INVESTMENT AND ELIGIBILITY TO SECURE PUBLIC FUNDS IN TEXAS
The PID Act and Section 1201.041 of the Public Security Procedures Act (Chapter 1201, Texas Government
Code, as amended) provide that the Bonds are negotiable instruments and investment securities governed by Chapter
8, Texas Business and Commerce Code, as amended, and are legal and authorized investments for insurance
companies, fiduciaries, trustees, or for the sinking funds of municipalities or other political subdivisions or public
agencies of the State. With respect to investment in the Bonds by municipalities or other political subdivisions or
public agencies of the State, the PFIA requires that the Bonds be assigned a rating of at least “A” or its equivalent as
to investment quality by a national rating agency. See “NO RATING” above. In addition, the PID Act and various
provisions of the Texas Finance Code provide that, subject to a prudent investor standard, the Bonds are legal
investments for state banks, savings banks, trust companies with capital of one million dollars or more, and savings
and loan associations. The Bonds are eligible to secure deposits to the extent of their market value. No review by the
City has been made of the laws in other states to determine whether the Bonds are legal investments for various
institutions in those states. No representation is made that the Bonds will be acceptable to public entities to secure
their deposits or acceptable to such institutions for investment purposes.
The City made no investigation of other laws, rules, regulations or investment criteria which might apply to
such institutions or entities or which might limit the suitability of the Bonds for any of the foregoing purposes or limit
the authority of such institutions or entities to purchase or invest in the Bonds for such purposes.
INVESTMENTS
The City invests its funds in investments authorized by Texas law in accordance with investment policies
approved by the City Council. Both Texas law and the City’s investment policies are subject to change.
Under State law, the City is authorized to make investments meeting the requirements of the PFIA, which
currently include (1) obligations, including letters of credit, of the United States or its agencies and instrumentalities,
including the Federal Home Loan Banks; (2) direct obligations of the State or its agencies and instrumentalities; (3)
collateralized mortgage obligations directly issued by a federal agency or instrumentality of the United States, the
underlying security for which is guaranteed by an agency or instrumentality of the United States; (4) other obligations,
the principal and interest of which is guaranteed or insured by or backed by the full faith and credit of, the State or the
United States or their respective agencies and instrumentalities, including obligations that are fully guaranteed or
insured by the Federal Deposit Insurance Corporation or by the explicit full faith and credit of the United States; (5)
obligations of states, agencies, counties, cities, and other political subdivisions of any state rated as to investment
quality by a nationally recognized investment rating firm not less than “A” or its equivalent; (6) bonds issued, assumed
or guaranteed by the State of Israel; (7) interest-bearing banking deposits that are guaranteed or insured by the Federal
Deposit Insurance Corporation or its successor, or the National Credit Union Share Insurance Fund or its successor;
8) interest-bearing banking deposits other than those described by clause (7) if (A) the funds invested in the banking
deposits are invested through: (i) a broker with a main office or branch office in this state that the City selects from a
list the governing body or designated investment committee of the City adopts as required by Section 2256.025, Texas
Government Code; or (ii) a depository institution with a main office or branch office in this state that the City selects;
B) the broker or depository institution selected as described by (A) above arranges for the deposit of the funds in the
banking deposits in one or more federally insured depository institutions, regardless of where located, for the City’s
account; (C) the full amount of the principal and accrued interest of the banking deposits is insured by the United
States or an instrumentality of the United States; and (D) the City appoints as the City’s custodian of the banking
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deposits issued for the City’s account: (i) the depository institution selected as described by (A) above; (ii) an entity
described by Section 2257.041(d), Texas Government Code; or (iii) a clearing broker dealer registered with the SEC
and operating under SEC Rule 15c3-3; (9) (i) certificates of deposit or share certificates meeting the requirements of
the PFIA that are issued by an institution that has its main office or a branch office in the State and are guaranteed or
insured by the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund, or their
respective successors, or are secured as to principal by obligations described in clauses (1) through (8) or in any other
manner and provided for by law for City deposits, or (ii) certificates of deposits where (a) the funds are invested by
the City through (A) a broker that has its main office or a branch office in the State and is selected from a list adopted
by the City as required by law, or (B) a depository institution that has its main office or branch office in the State that
is selected by the City, (b) the broker or the depository institution selected by the City arranges for the deposit of the
funds in certificates of deposit in one or more federally insured depository institutions, wherever located, for the
account of the City, (c) the full amount of the principal and accrued interest of each of the certificates of deposit is
insured by the United States or an instrumentality of the United States, and (d) the City appoints the depository
institution selected under (a) above, a custodian as described by Section 2257.041(d) of the Texas Government Code,
or a clearing broker-dealer registered with the SEC and operating pursuant to SEC Rule 15c3-3 (17 C.F.R. Section
240.15c3-3) as custodian for the City with respect to the certificates of deposit; (10) fully collateralized repurchase
agreements that have a defined termination date, are secured by a combination of cash and obligations described in
clause (1) above or clause (12) below, require the securities being purchased by the City or cash held by the City to
be pledged to the City, held in the City’s name, and deposited at the time the investment is made with the City or with
a third party selected and approved by the City, and are placed through a primary government securities dealer, as
defined by the Federal Reserve, or a financial institution doing business in the State; (11) certain bankers’ acceptances
with the remaining term of 270 days or less, if the short-term obligations of the accepting bank or its parent are rated
at least “A-1” or “P-1” or the equivalent by at least one nationally recognized credit rating agency; (12) commercial
paper with a stated maturity of 365 days or less that is rated at least “A-1” or “P-1” or the equivalent by either (a) two
nationally recognized credit rating agencies or (b) one nationally recognized credit rating agency if the paper is fully
secured by an irrevocable letter of credit issued by a U.S. or state bank; (13) no-load money market mutual funds
registered with and regulated by the United States SEC that provide the City with a prospectus and other information
required by the Securities Exchange Act of 1934 or the Investment Company Act of 1940 and that comply with federal
SEC Rule 2a-7 (17 C.F.R. Section 270.2a-7), promulgated under the Investment Company Act of 1940 (15 U.S.C.
Section 80a-1 et seq.); and (14) no-load mutual funds registered with the SEC that have an average weighted maturity
of less than two years, and either (a) a duration of one year or more and invest exclusively in obligations described in
under this heading, or (b) a duration of less than one year and the investment portfolio is limited to investment grade
securities, excluding asset-backed securities. In addition, bond proceeds may be invested in guaranteed investment
contracts that have a defined termination date and are secured by obligations, including letters of credit, of the United
States or its agencies and instrumentalities, other than the prohibited obligations described below, in an amount at
least equal to the amount of bond proceeds invested under such contract and are pledged to the City and deposited
with the City or a third party selected and approved by the City.
The City may invest in such obligations directly or through government investment pools that invest solely
in such obligations provided that the pools are rated no lower than “AAA” or “AAAm” or an equivalent by at least
one nationally recognized rating service. The City may also contract with an investment management firm registered
under the Investment Advisers Act of 1940 (15 U.S.C. Section 80b-1 et seq.) or with the State Securities Board to
provide for the investment and management of its public funds or other funds under its control for a term up to two
years, but the City retains ultimate responsibility as fiduciary of its assets. In order to renew or extend such a contract,
the City must do so by order, ordinance, or resolution. The City is specifically prohibited from investing in: (1)
obligations whose payment represents the coupon payments on the outstanding principal balance of the underlying
mortgage-backed security collateral and pays no principal; (2) obligations whose payment represents the principal
stream of cash flow from the underlying mortgage-backed security and bears no interest; (3) collateralized mortgage
obligations that have a stated final maturity of greater than ten (10) years; and (4) collateralized mortgage obligations
the interest rate of which is determined by an index that adjusts opposite to the changes in a market index.
Political subdivisions such as the City are authorized to implement securities lending programs if (i) the
securities loaned under the program are 100% collateralized, a loan made under the program allows for termination at
any time and a loan made under the program is either secured by (a) obligations that are described in clauses (1)
through (8) above, (b) irrevocable letters of credit issued by a state or national bank that is continuously rated by a
nationally recognized investment rating firm at not less than “A” or its equivalent or (c) cash invested in obligations
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described in clauses (1) through (8) above, clauses (12) through (14) above, or an authorized investment pool; (ii)
securities held as collateral under a loan are pledged to the City, held in the City’s name and deposited at the time the
investment is made with the City or a third party designated by the City; (iii) a loan made under the program is placed
through either a primary government securities dealer or a financial institution doing business in the State; and (iv)
the agreement to lend securities has a term of one year or less.
Under State law, the City is required to invest its funds under written investment policies that primarily
emphasize safety of principal and liquidity; that address investment diversification, yield, maturity, and the quality
and capability of investment management; and that include a list of authorized investments for City funds, the
maximum allowable stated maturity of any individual investment, the maximum average dollar-weighted maturity
allowed for pooled fund groups, methods to monitor the market price of investments acquired with public funds, a
requirement for settlement of all transactions, except investment pool funds and mutual funds, on a delivery versus
payment basis, and procedures to monitor rating changes in investments acquired with public funds and the liquidation
of such investments consistent with the PFIA. All City funds must be invested consistent with a formally adopted
Investment Strategy Statement” that specifically addresses each fund’s investment. Each Investment Strategy
Statement will describe its objectives concerning: (1) suitability of investment type, (2) preservation and safety of
principal, (3) liquidity, (4) marketability of each investment, (5) diversification of the portfolio, and (6) yield.
Under State law, the City’s investments must be made “with judgment and care, under prevailing
circumstances, that a person of prudence, discretion, and intelligence would exercise in the management of the
person’s own affairs, not for speculation, but for investment considering the probable safety of capital and the probable
income to be derived.” At least quarterly the City’s investment officers must submit an investment report to the City
Council detailing: (1) the investment position of the City, (2) that all investment officers jointly prepared and signed
the report, (3) the beginning market value, the ending market value and the fully accrued interest for the reporting
period of each pooled fund group, (4) the book value and market value of each separately listed asset at the end of the
reporting period, (5) the maturity date of each separately invested asset, (6) the account or fund or pooled fund group
for which each individual investment was acquired, and (7) the compliance of the investment portfolio as it relates to:
a) adopted investment strategies and (b) State law. No person may invest City funds without express written authority
from the City Council.
Under State law, the City is additionally required to: (1) annually review its adopted policies and strategies;
2) adopt by written instrument a rule, order, ordinance or resolution stating that it has reviewed its investment policy
and investment strategies and records any changes made to either its investment policy or investment strategy in the
respective rule, order, ordinance or resolution; (3) require any investment officers with personal business relationships
or relatives with firms seeking to sell securities to the City to disclose the relationship and file a statement with the
Texas Ethics Commission and the City Council; (4) require the qualified representative of firms offering to engage in
an investment transaction with the City to: (a) receive and review the City’s investment policy, (b) acknowledge that
reasonable controls and procedures have been implemented to preclude investment transactions conducted between
the City and the business organization that are not authorized by the City’s investment policy (except to the extent that
this authorization is dependent on an analysis of the makeup of the entity’s entire portfolio, requires an interpretation
of subjective investment standards or relates to investment transactions of the entity that are not made through accounts
or other contractual arrangements over which the business organization has accepted discretionary investment
authority), and (c) deliver a written statement in a form acceptable to the City and the business organization attesting
to these requirements; (5) in conjunction with its annual financial audit, perform a compliance audit of the management
controls on investments and adherence to the City’s investment policy; (6) provide specific investment training for the
Treasurer, chief financial officer and investment officers; (7) restrict reverse repurchase agreements to not more than
90 days and restrict the investment of reverse repurchase agreement funds to no greater than the term of the reverse
purchase agreement; (8) restrict the investment in no-load mutual funds in the aggregate to no more than 15% of the
City’s monthly average fund balance, excluding bond proceeds and reserves and other funds held for debt service; (9)
require local government investment pools to conform to the new disclosure, rating, net asset value, yield calculation,
and advisory board requirements; and (10) at least annually review, revise and adopt a list of qualified brokers that
are authorized to engage in investment transactions with the City.
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INFORMATION RELATING TO THE TRUSTEE
The City has appointed Regions Bank, an Alabama state banking corporation, to serve as Trustee. The Trustee
is to carry out those duties assignable to it under the Indenture. Except for the contents of this section, the Trustee has
not reviewed or participated in the preparation of this Limited Offering Memorandum and assumes no responsibility
for the contents, accuracy, fairness, or completeness of the information set forth in this Limited Offering Memorandum
or for the recitals contained in the Indenture or the Bonds, or for the validity, sufficiency, or legal effect of any of such
documents.
Furthermore, the Trustee has no oversight responsibility, and is not accountable, for the use or application by
the City of any of the Bonds authenticated or delivered pursuant to the Indenture or for the use or application of the
proceeds of such Bonds by the City. The Trustee has not evaluated the risks, benefits, or propriety of any investment
in the Bonds and makes no representation, and has reached no conclusions, regarding the value or condition of any
assets or revenues pledged or assigned as security for the Bonds, the technical or financial feasibility of the project,
or the investment quality of the Bonds, about all of which the Trustee expresses no opinion and expressly disclaims
the expertise to evaluate.
Additional information about the Trustee may be found at its website at www.regions.com. Neither the
information on the Trustee’s website, nor any links from that website, is a part of this Limited Offering Memorandum,
nor should any such information be relied upon to make investment decisions regarding the Bonds.
SOURCES OF INFORMATION
General
The information contained in this Limited Offering Memorandum has been obtained primarily from the
City’s records, the Developer and its representatives and other sources believed to be reliable. In accordance with its
responsibilities under the federal securities law, the Underwriter has reviewed the information in this Limited Offering
Memorandum in accordance with, and as part of, its responsibilities to investors under the federal securities laws as
applied to the facts and circumstances of the transaction, but the Underwriter does not guarantee the accuracy or
completeness of such information. The information and expressions of opinion herein are subject to change without
notice, and neither the delivery of this Limited Offering Memorandum or any sale hereunder will create any
implication that there has been no change in the financial condition or operations of the City or the Developer described
herein since the date hereof. This Limited Offering Memorandum contains, in part, estimates and matters of opinion
that are not intended as statements of fact, and no representation or warranty is made as to the correctness of such
estimates and opinions or that they will be realized. The summaries of the statutes, resolutions, ordinances, indentures
and engineering and other related reports set forth herein are included subject to all of the provisions of such
documents. These summaries do not purport to be complete statements of such provisions and reference is made to
such documents for further information.
Developer
The information contained in this Limited Offering Memorandum relating to the description of the
Improvement Area #1 Projects, the Development, and the Developer generally and, in particular, the information
included in the sections captioned “PLAN OF FINANCE” (except for the subcaption “– The Bonds”),
OVERLAPPING TAXES AND DEBT – Agricultural Valuation” (last paragraph only) and “– Homeowners’
Association Dues,” “THE IMPROVEMENT AREA #1 AUTHORIZED IMPROVEMENTS,” “THE
DEVELOPMENT,” “THE DEVELOPER,” “BONDHOLDERS’ RISKS” (only as it pertains to the Developer, the
Improvement Area #1 Projects, and the Development), “LEGAL MATTERS – Litigation – The Developer,”
CONTINUING DISCLOSURE – The Developer” and “– The Developer’s Compliance with Prior Undertakings,”
APPENDIX E-2,” and “APPENDIX F” have been provided by the Developer, and the Developer warrants and
represents that the information contained herein is true and correct and does not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the statements made herein, in the light of
the circumstances under which they were made, not misleading. At the time of delivery of the Bonds to the
Underwriter, the Developers will deliver a certificate to this effect to the City and the Underwriter.
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Experts
The information regarding the Service and Assessment Plan in this Limited Offering Memorandum has been
provided by P3Works, LLC and has been included in reliance upon the authority of such firm as experts in the field
of assessment allocation/methodology and district administration..
The information regarding the Appraisal in this Limited Offering Memorandum has been provided by the
Appraiser, and has been included in reliance upon the authority of such firm as experts in the field of the appraisal of
real property. The Appraiser has consented to the inclusion of the Appraisal herein.
Updating of Limited Offering Memorandum
If, subsequent to the date of the Limited Offering Memorandum, the City learns, through the ordinary course
of business and without undertaking any investigation or examination for such purposes, or is notified by the
Underwriter, of any adverse event which causes the Limited Offering Memorandum to be materially misleading, and
unless the Underwriter elects to terminate its obligation to purchase the Bonds, the City will promptly prepare and
supply to the Underwriter an appropriate amendment or supplement to the Limited Offering Memorandum satisfactory
to the Underwriter; provided, however, that the obligation of the City to so amend or supplement the Limited Offering
Memorandum will terminate when the City delivers the Bonds to the Underwriter, unless the Underwriter notifies the
City on or before such date that less than all of the Bonds have been sold to ultimate customers; in which case the
City’s obligations hereunder will extend for an additional period of time (but not more than 90 days after the date the
City delivers the Bonds) until all of the Bonds have been sold to ultimate customers.
FORWARD-LOOKING STATEMENTS
Certain statements included or incorporated by reference in this Limited Offering Memorandum constitute
forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of
1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the
Securities Act. Such statements are generally identifiable by the terminology used such as “plan,” “expect,”
estimate,” “project,” “anticipate,” “budget” or other similar words.
THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH
FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND
OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS
DESCRIBED HEREIN TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE
OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. THE
CITY DOES NOT PLAN TO ISSUE ANY UPDATES OR REVISIONS TO THOSE FORWARD-LOOKING
STATEMENTS IF OR WHEN ANY OF ITS EXPECTATIONS, OR EVENTS, CONDITIONS OR
CIRCUMSTANCES ON WHICH SUCH STATEMENTS ARE BASED OCCUR, OTHER THAN AS DESCRIBED
UNDER “CONTINUING DISCLOSURE” HEREIN.
AUTHORIZATION AND APPROVAL
The City Council has approved by resolution this Preliminary Limited Offering Memorandum and the City
Council has authorized this Preliminary Limited Offering Memorandum to be used by the Underwriter in connection
with the marketing and sale of the Bonds. In the Bond Ordinance, the City Council will approve the form and content
of the final Limited Offering Memorandum.
APPENDIX A – Page 1
APPENDIX A
GENERAL INFORMATION REGARDING THE CITY AND SURROUNDING AREAS
Major Employers
The major employers in the City are set forth in the table below.
Emplo e Product or Service Emplo ees
Anna ISD Education 856
Walmar Retail 457
Cit of Anna Governmen 191
Pate Rehab Medical 168
Brookshire’s Grocer Store 97
Loves Travel Shop Retail 56
McDonalds Restauran 49
Hurricane Creek Countr Club Countr Club 48
Bronco Manufacturin Machine Shop 37
Tri-Count Ve Veterinar Clinic 12
Source: City of Anna 2024 Comprehensive Annual Financial Report
Historical Employment in Collin County
Average Annual
2025(1) 2024 2023 2022 2021
Civilian Labor Force 690,212 680,301 664,539 635,039 597,989
Total Emplo e 660,197 654,384 640,361 614,007 571,326
Total Unemplo e 30,015 25,917 24,178 21,032 26,663
Unemplo ment Rate 4.3% 3.8% 3.6% 3.3% 4.5%
1) Data through August 2025.
Source: Texas Workforce Commission.
THE REMAINDER OF THIS PAGE IS LEFT BLANK INTENTIONALLY.
Surrounding Economic Activity
The major employers of municipalities surrounding the City are set forth in the table below.
Source: Municpal Advisory Council of Texas
City of McKinney City of Frisco City of Plano
Approximately 18 miles from the City Approximately 28 miles from the City Approximately 27 miles from the City
Employer Employees Employer Employees Employer Employees
Raytheon Space & Airborne Systems 4,200 Frisco ISD 8,850 JP Morgan Chase 10,530
McKinney ISD 2,920 Dallas Cowboys 2,000 Bank of America 6,318
Collin County 2,000 City of Frisco 1,813 Capital One Finance 5,578
Globe Life 1,700 HCL Technologies Ltd, 1,500 Toyota Motor North America,
Inc. 4,960
Encore Wire Corp. 1,653 ICS 1,300 PepsiCo 3,759
City of McKinney 1,565 Keurig Dr. Pepper Inc. 1,213 Ericsson 3,346
Medical City of McKinney 1,424 Amerisource Bergen Specialty
Group 749 At&T Foundry 2,500
Baylor Scott & White Medical Center 1,171 Baylor Scott White/Centennial
Hosp. 567 Medical City Plano 2,332
Collin College 794 Mario Sinacola & Sons
Excavating 500 Liberty Mutual Insurance Co. 2,184
Simpson Strong-Tile 650 Goodman Networks Inc. 463 USAA 2,092
City of Grapevine
Approximately 49 miles from the City
Employe Employees
Gaylord Texas Resort & Conv Ctr 2,000
Dallas/Ft. Worth Int’l Airport 1,970
Grapevine-Colleyville ISD 1,870
Paycom 990
Baylor Medical 660
Great Wolf Lodge 600
City of Grapevine 590
Boeing Distribution 500
Hyatt Regency DFW 500
Kubota 450
City of Dallas
Approximately 32 miles from the City
Employer Employees
UT Southwestern Medical Ctr. 25,641
Dallas ISD 22,857
Southwest Airlines Co. 19,190
City of Dallas 13,798
Parkland Health & Hosp Sys 13,103
AT&T Inc. 10,690
Dallas County Comm College 8,230
Texas Instruments Inc. 7,704
Methodist Dallas Medical
Center 6,689
Dallas County 6,500
THIS PAGE IS LEFT BLANK INTENTIONALLY.
APPENDIX B
FORM OF INDENTURE
INDENTURE OF TRUST
By and Between
CITY OF ANNA, TEXAS
and
REGIONS BANK,
as Trustee
DATED AS OF NOVEMBER 15, 2025
SECURING
CITY OF ANNA, TEXAS
SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2
IMPROVEMENT AREA #1 PROJECT)
TABLE OF CONTENTS
Page
ARTICLE I – DEFINITIONS, FINDINGS AND INTERPRETATION ....................................... 4
Section 1.1.Definitions........................................................................................................... 4
Section 1.2. Findings............................................................................................................. 12
Section 1.3. Table of Contents, Titles and Headings. ........................................................... 13
Section 1.4. Interpretation. .................................................................................................... 13
ARTICLE II – THE BONDS ........................................................................................................ 13
Section 2.1. Security for the Bonds. ..................................................................................... 13
Section 2.2. Limited Obligations. ......................................................................................... 14
Section 2.3. Authorization for Indenture. ............................................................................. 14
Section 2.4. Contract with Owners and Trustee. .................................................................. 14
ARTICLE III – AUTHORIZATION; GENERAL TERMS AND PROVISIONS REGARDING
THE BONDS ................................................................................................................................ 14
Section 3.1. Authorization. ................................................................................................... 14
Section 3.2. Date, Denomination, Maturities, Numbers and Interest. .................................. 15
Section 3.3. Conditions Precedent to Delivery of Bonds. ..................................................... 15
Section 3.4. Medium, Method and Place of Payment. .......................................................... 16
Section 3.5. Execution and Registration of Bonds. .............................................................. 17
Section 3.7. Ownership. ........................................................................................................ 18
Section 3.8. Registration, Transfer and Exchange. ............................................................... 18
Section 3.9. Cancellation. ..................................................................................................... 19
Section 3.10. Temporary Bonds. ............................................................................................. 19
Section 3.11. Replacement Bonds. ......................................................................................... 20
Section 3.12. Book-Entry-Only System.................................................................................. 21
Section 3.13. Successor Securities Depository: Transfer Outside Book-Entry-Only System. 22
Section 3.14. Payments to Cede & Co. ................................................................................... 22
ARTICLE IV – REDEMPTION OF BONDS BEFORE MATURITY ....................................... 22
Section 4.1. Limitation on Redemption. ............................................................................... 22
Section 4.2. Mandatory Sinking Fund Redemption. ............................................................. 22
Section 4.3. Optional Redemption. ....................................................................................... 24
Section 4.5. Partial Redemption............................................................................................ 24
Section 4.6. Notice of Redemption to Owners. .................................................................... 25
Section 4.7. Payment upon Redemption. .............................................................................. 26
Section 4.8. Effect of Redemption. ....................................................................................... 26
ARTICLE V – FORM OF THE BONDS ..................................................................................... 26
Section 5.1. Form Generally. ................................................................................................ 26
Section 5.2. Form of the Bonds. ........................................................................................... 27
Section 5.3. Cusip Registration. ............................................................................................ 35
Section 5.4. Legal Opinion. .................................................................................................. 35
ARTICLE VI – FUNDS AND ACCOUNTS ............................................................................... 35
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Section 6.1.Establishment of Funds and Accounts. ............................................................. 35
Section 6.2. Initial Deposits to Funds and Accounts. ........................................................... 36
Section 6.3. Pledged Revenue Fund. .................................................................................... 37
Section 6.4. Bond Fund. ........................................................................................................ 38
Section 6.5. Project Fund. ..................................................................................................... 39
Section 6.6. Redemption Fund. ............................................................................................. 40
Section 6.7.Reserve Fund. ................................................................................................... 41
Section 6.8. Rebate Fund: Rebatable Arbitrage. ................................................................... 43
Section 6.9. Administrative Fund. ........................................................................................ 43
Section 6.10. Investment of Funds. ......................................................................................... 43
ARTICLE VII – COVENANTS ................................................................................................... 45
Section 7.1. Confirmation of Improvement Area #1 Assessments. ...................................... 45
Section 7.2. Collection and Enforcement of Improvement Area #1 Assessments. .............. 45
Section 7.3. Against Encumbrances. ..................................................................................... 46
Section 7.4. Records, Accounts, Accounting Reports. ......................................................... 46
Section 7.5. Covenants Regarding Tax Exemption of Interest on Bonds. ............................ 46
ARTICLE VIII – LIABILITY OF CITY ...................................................................................... 49
Section 8.1. Liability of City................................................................................................. 49
ARTICLE IX – THE TRUSTEE .................................................................................................. 51
Section 9.1. Acceptance of Trust; Trustee as Registrar and Paying Agent. ......................... 51
Section 9.2. Trustee Entitled to Indemnity. .......................................................................... 51
Section 9.3. Responsibilities of the Trustee. ......................................................................... 51
Section 9.4. Property Held in Trust. ..................................................................................... 53
Section 9.5. Trustee Protected in Relying on Certain Documents. ....................................... 53
Section 9.6. Compensation. .................................................................................................. 54
Section 9.7. Permitted Acts. .................................................................................................. 54
Section 9.8. Resignation of Trustee. ..................................................................................... 55
Section 9.9. Removal of Trustee. .......................................................................................... 55
Section 9.10. Successor Trustee.............................................................................................. 55
Section 9.11. Transfer of Rights and Property to Successor Trustee. ..................................... 56
Section 9.12. Merger, Conversion or Consolidation of Trustee. ............................................ 56
Section 9.13. Trustee to File Continuation Statements. .......................................................... 57
Section 9.14. Accounts, Periodic Reports and Certificates. ................................................... 57
Section 9.15. Construction of Indenture. ................................................................................ 57
Section 9.16.Offering Documentation. .................................................................................. 57
ARTICLE X – MODIFICATION OR AMENDMENT OF THIS INDENTURE ....................... 57
Section 10.1. Amendments Permitted. .................................................................................... 57
Section 10.2. Owners’ Meetings. ............................................................................................ 58
Section 10.3. Procedure for Amendment with Written Consent of Owners. .......................... 59
Section 10.4. Procedure for Amendment not Requiring Owner Consent. .............................. 59
Section 10.5. Effect of Supplemental Indenture. .................................................................... 60
Section 10.6. Endorsement or Replacement of Bonds Issued after Amendments. ................. 60
Section 10.7.Amendatory Endorsement of Bonds. ............................................................... 60
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Section 10.8. Waiver of Default. ............................................................................................ 60
Section 10.9. Execution of Supplemental Indenture. .............................................................. 60
ARTICLE XI – DEFAULT AND REMEDIES ............................................................................ 61
Section 11.1. Events of Default. ............................................................................................. 61
Section 11.2. Immediate Remedies for Default. ..................................................................... 62
Section 11.3. Restriction on Owner’s Action. ........................................................................ 62
Section 11.4. Application of Revenues and Other Moneys after Default. .............................. 63
Section 11.5. Effect of Waiver. ............................................................................................... 64
Section 11.6. Evidence of Ownership of Bonds. .................................................................... 64
Section 11.7. No Acceleration. ............................................................................................... 65
Section 11.8. Mailing of Notice. ............................................................................................. 65
Section 11.9. Exclusion of Bonds. .......................................................................................... 65
ARTICLE XII – GENERAL COVENANTS AND REPRESENTATIONS ............................... 65
Section 12.1. Representations as to Trust Estate. ................................................................... 65
Section 12.2. General. ............................................................................................................. 66
ARTICLE XIII – SPECIAL COVENANTS ................................................................................ 66
Section 13.1. Further Assurances; Due Performance. ............................................................ 66
Section 13.2. Other Obligations or Other Liens; Refunding Bonds. ...................................... 66
Section 13.3. Books of Record. .............................................................................................. 67
ARTICLE XIV – PAYMENT AND CANCELLATION OF THE BONDS AND
SATISFACTION OF THE INDENTURE ................................................................................... 67
Section 14.1. Trust Irrevocable. .............................................................................................. 67
Section 14.2. Satisfaction of Indenture. .................................................................................. 67
Section 14.3. Bonds Deemed Paid. ......................................................................................... 67
ARTICLE XV - MISCELLANEOUS .......................................................................................... 68
Section 15.1. Benefits of Indenture Limited to Parties. .......................................................... 68
Section 15.2. Successor is Deemed Included in all References to Predecessor. .................... 68
Section 15.3. Execution of Documents and Proof of Ownership by Owners. ........................ 69
Section 15.4. No Waiver of Personal Liability. ...................................................................... 69
Section 15.5. Notices to and Demands on City and Trustee. .................................................. 69
Section 15.6. Partial Invalidity................................................................................................ 70
Section 15.7. Applicable Laws. .............................................................................................. 70
Section 15.8. Payment on Business Day. ................................................................................ 70
Section 15.9. CFA Agreement Amendments and Supplements. ............................................ 70
Section 15.10. Counterparts. ..................................................................................................... 71
Section 15.11.Texas Government Code Verifications. ............................................................ 71
INDENTURE OF TRUST
THIS INDENTURE, dated as of November 15, 2025, is by and between the CITY OF
ANNA, TEXAS (the "City"), and REGIONS BANK, an Alabama state banking corporation with
offices in Houston, Texas, as trustee (together with its successors, the "Trustee"). Capitalized
terms used in the preambles, recitals and granting clauses and not otherwise defined shall have
the meanings assigned thereto in Article I.
WHEREAS, on December 6, 2024, a petition (the "Petition") was submitted and filed
with the City Secretary of the City (the "City Secretary") pursuant to the Public Improvement
District Assessment Act, Chapter 372, Texas Local Government Code, as amended (the "Act" or
PID Act"), requesting the creation of a public improvement district located within the corporate
limits of the City to be known as "Crystal Park Public Improvement District No. 2" (the
District"); and
WHEREAS, the Petition contained the signatures of the owners of taxable real property
representing more than fifty percent of the appraised value of taxable real property liable for
assessment within the District, as determined by the then current ad valorem tax rolls of the
Collin Central Appraisal District, and the signatures of record property owners who own taxable
real property that constitutes more than fifty percent of the area of all taxable property that is
liable for assessment by the District; and
WHEREAS, on January 28, 2025, the City Council of the City (the "City Council")
adopted Resolution No. 2025-01-1726 accepting the Petition and calling a public hearing on the
creation of the District on February 25, 2025; and
WHEREAS, on February 25, 2025, after due notice, the City Council held the public
hearing in the manner required by law on the advisability of the improvement projects and
services described in the Petition as required by Section 372.009 of the PID Act and, on February
25, 2025, the City Council made the findings required by Section 372.009(b) of the PID Act and,
by Resolution No. 2025-02-1744 adopted by the City Council (the “Creation Resolution”),
authorized the District in accordance with its finding as to the advisability of the improvement
projects and services; and
WHEREAS, following the adoption of the Creation Resolution, the City recorded said
Creation Resolution in the real property records of Collin County, Texas as Document No.
2025000022810; and
WHEREAS, no written protests of the District from any owners of record of property
within the District were filed with the City Secretary within 20 days after the date of adoption of
said Creation Resolution; and
WHEREAS, on October 27, 2025, the City Council called for a public hearing to be held
to consider the proposed Improvement Area #1 Assessment Roll, the Service and Assessment
Plan and the levy of the Improvement Area #1 Assessments on the Improvement Area #1
Assessed Property, and the City (i) published notice of such public hearing in a newspaper of
general circulation in the City and (ii) mailed notice of such public hearing to the last known
2
address of the owners of the property liable for the Improvement Area #1 Assessments pursuant
to Section 372.016(c) of the Act; and
WHEREAS, the City Council convened the public hearing on November 17, 2025, at
which all persons who appeared, or requested to appear, in person or by their attorney, were
given the opportunity to contend for or contest the Service and Assessment Plan, the
Improvement Area #1 Assessment Roll and the Improvement Area #1 Assessments, and to offer
testimony pertinent to any issue presented on the amount of the Improvement Area #1
Assessments, the allocation of Improvement Area #1 Projects, the purposes of the Improvement
Area #1 Assessments, the special benefits of the Improvement Area #1 Assessments and the
penalties and interest on Improvement Area #1 Annual Installments and on delinquent
Improvement Area #1 Annual Installments of the Improvement Area #1 Assessments; and
WHEREAS, at the November 17, 2025 public hearing referenced above, there were no
written objections or evidence submitted to the City Secretary in opposition to the Service and
Assessment Plan, the allocation of the Improvement Area #1 Projects, the Improvement Area #1
Assessment Roll or the levy of the Improvement Area #1 Assessments; and
WHEREAS, the City Council closed the public hearing and, after considering all written
and documentary evidence presented at the public hearing, including all written comments and
statements filed with the City, at the meeting held on November 17, 2025, approved and
accepted the Service and Assessment Plan in conformity with the requirements of the PID Act
and adopted the Assessment Ordinance, which Assessment Ordinance approved the
Improvement Area #1 Assessment Roll and levied the Improvement Area #1 Assessments; and
WHEREAS, the City Council is authorized by the PID Act to issue revenue bonds
payable from the Improvement Area #1 Assessments for the purpose of (i) paying a portion of
the Improvement Area #1 Project Costs, (ii) paying a portion of the interest on the Bonds during
and after the period of acquisition and construction of the Improvement Area #1 Projects, (iii)
funding a reserve fund for payment of principal and interest on the Bonds, (iv) paying a portion
of the costs incidental to the organization of the District and (v) paying the costs of issuance of
the Bonds; and
WHEREAS, the City Council now desires to issue its revenue bonds, in accordance with
the PID Act, such bonds to be entitled "City of Anna, Texas, Special Assessment Revenue
Bonds, Series 2025 (Crystal Park Public Improvement District No. 2 Improvement Area #1
Project)" (the "Bonds"), such Bonds being payable solely from the Trust Estate and for the
purposes set forth in this preamble; and
WHEREAS, the Trustee has agreed to accept the trusts herein created upon the terms set
forth in this Indenture;
NOW, THEREFORE, the City, in consideration of the foregoing premises and
acceptance by the Trustee of the trusts herein created, of the purchase and acceptance of the
Bonds by the Owners thereof, and of other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, does hereby GRANT, CONVEY, PLEDGE,
TRANSFER, ASSIGN, and DELIVER to the Trustee for the benefit of the Owners, a first lien
3
on, a security interest in, and pledge of all of the moneys, rights and properties described in the
Granting Clauses hereof, as follows (collectively, the "Trust Estate"):
FIRST GRANTING CLAUSE
The Pledged Revenues, as herein defined, including all moneys and investments held in
the Pledged Funds, including any contract or any evidence of indebtedness related thereto or
other rights of the City to receive any of such moneys or investments, whether now existing or
hereafter coming into existence, and whether now or hereafter acquired; and
SECOND GRANTING CLAUSE
Any and all other property or money of every name and nature which is, from time to
time hereafter by delivery or by writing of any kind, conveyed, pledged, assigned or transferred,
to the Trustee as additional security hereunder by the City or by anyone on its behalf or with its
written consent, and the Trustee is hereby authorized to receive any and all such property or
money at any and all times and to hold and apply the same subject to the terms thereof; and
THIRD GRANTING CLAUSE
Any and all proceeds of the foregoing property and proceeds from the investment of the
foregoing property;
TO HAVE AND TO HOLD the Trust Estate, whether now owned or hereafter acquired,
unto the Trustee and its successors or assigns;
IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth for the benefit
of all present and future Owners of the Bonds from time to time issued under and secured by this
Indenture, and for enforcement of the payment of the Bonds in accordance with their terms, and
for the performance of and compliance with the obligations, covenants, and conditions of this
Indenture;
PROVIDED, HOWEVER, if the City or its assigns shall well and truly pay, or cause to
be paid, the principal or Redemption Price of and the interest on the Bonds at the times and in the
manner stated in the Bonds, according to the true intent and meaning thereof, then this Indenture
and the rights hereby granted shall cease, terminate and be void; otherwise this Indenture is to be
and remain in full force and effect;
IN ADDITION, the Bonds are special, limited obligations of the City payable solely from
the Trust Estate, as and to the extent provided in this Indenture. The Bonds do not give rise to a
charge against the general credit or taxing powers of the City and are not payable except as
provided in this Indenture. Notwithstanding anything to the contrary herein, the Owners of the
Bonds shall never have the right to demand payment thereof out of any funds of the City other
than the Trust Estate. The City shall have no legal or moral obligation to pay for the Bonds out
of any funds of the City other than the Trust Estate.
THIS INDENTURE FURTHER WITNESSETH, and it is expressly declared, that all
Bonds issued and secured hereunder are to be issued, authenticated, and delivered and the Trust
Estate hereby created, assigned, and pledged is to be dealt with and disposed of under, upon and
subject to the terms, conditions, stipulations, covenants, agreements, trusts, uses, and purposes as
4
hereinafter expressed, and the City has agreed and covenanted, and does hereby agree and
covenant, with the Trustee and with the respective Owners from time to time of the Bonds as
follows:
ARTICLE I
DEFINITIONS, FINDINGS AND INTERPRETATION
Section 1.1. Definitions.
Unless otherwise expressly provided or unless the context clearly requires otherwise in
this Indenture, the following terms shall have the meanings specified below:
Account", in the singular, means any of the accounts established pursuant to Section 6.1
of this Indenture, and "Accounts", in the plural, means, collectively, all of the accounts
established pursuant to Section 6.1 of this Indenture.
Actual Costs” mean with respect to Improvement Area #1 Projects, the actual costs paid
or incurred by or on behalf of the Developer, (either directly or through affiliates), including: (1)
the costs for the design, planning, financing, administration/management, acquisition,
installation, construction and/or implementation of such Improvement Area #1 Projects; (2) the
fees paid for obtaining permits, licenses, or other governmental approvals for such Improvement
Area #1 Projects; (3) the costs for external professional services, such as engineering,
geotechnical, surveying, land planning, architectural landscapers, appraisals, legal, accounting,
and similar professional services; (4) the costs for all labor, bonds, and materials, including
equipment and fixtures, owing to contractors, builders, and materialmen engaged in connection
with the acquisition, construction, or implementation of the Improvement Area #1 Projects; (5)
all related permitting and public approval expenses, and architectural, engineering, consulting,
and other governmental fees and charges; and (6) costs to implement, administer, and manage
the above described activities including, but not limited to, a construction management fee equal
to four percent (4%) of construction costs if managed by or on behalf of the Developer.
Additional Interest” means the amount collected by the application of the Additional
Interest Rate.
Additional Interest Rate" means the 0.50% additional interest charged on the
Improvement Area #1 Assessments pursuant to Section 372.018 of the PID Act.
Administrative Fund" means that Fund established by Section 6.1 of this Indenture and
administered pursuant to Section 6.9 of this Indenture.
Administrator" means the City or independent firm designated by the City who shall
have the responsibilities provided in the Service and Assessment Plan, this Indenture, or any
other agreement or document approved by the City related to the duties and responsibilities of
the administration of the District.
Annual Collection Costs” mean the actual or budgeted costs and expenses related to the
operation of the District, including, but not limited to, costs and expenses for: (1) the
5
Administrator; (2) City staff; (3) legal counsel, engineers, accountants, financial advisors, and
other consultants engaged by the City; (4) calculating, collecting, and maintaining records with
respect to Improvement Area #1 Assessments and Improvement Area #1 Annual Installments;
5) preparing and maintaining records with respect to the Improvement Area #1 Assessment Roll
and Annual Service Plan Updates; (6) paying and redeeming Bonds; (7) investing or depositing
Improvement Area #1 Assessments and Improvement Area #1 Annual Installments; (8)
complying with this Service and Assessment Plan, the PID Act, and this Indenture, with respect
to the Bonds, including the City’s continuing disclosure requirements; and (9) the paying
agent/registrar and Trustee in connection with the Bonds, including their respective legal
counsel. Annual Collection Costs collected but not expended in any year shall be carried
forward and applied to reduce Annual Collection Costs for subsequent years.
Annual Debt Service" means, for each Bond Year, the sum of (i) the interest due on the
Outstanding Bonds in such Bond Year (excluding interest paid from funds on deposit in the
Capitalized Interest Account of the Bond Fund), assuming that the Outstanding Bonds are retired
as scheduled (including by reason of Sinking Fund Installments), and (ii) the principal amount of
the Outstanding Bonds due in such Bond Year (including any Sinking Fund Installments due in
such Bond Year).
Annual Service Plan Update" means an update to the Service and Assessment Plan
prepared no less frequently than annually by the Administrator and approved by the City
Council.
Applicable Laws" means the PID Act, and all other laws or statutes, rules, or regulations,
and any amendments thereto, of the State or of the United States of America, by which the City
and its powers, securities, operations, and procedures are, or may be, governed or from which its
powers may be derived.
Assessment Ordinance" means the ordinance adopted by the City Council on November
17, 2025, as may be amended or supplemented, that levied the Improvement Area #1
Assessments on the Improvement Area #1 Assessed Property.
Assessment Revenues" means the revenues received by the City from the collection of
Improvement Area #1 Assessments, including Prepayments, Improvement Area #1 Annual
Installments and Foreclosure Proceeds.
Attorney General" means the Attorney General of the State.
Authorized Denomination" means $100,000 and any integral multiple of $1,000 in
excess thereof. The City prohibits any Bond to be issued in a denomination of less than
100,000 and further prohibits the assignment of a CUSIP number to any Bond with a
denomination of less than $100,000, and any attempt to accomplish either of the foregoing shall
be void and of no effect.
Authorized Improvements" mean those improvements authorized by Section 372.003 of
the PID Act, including those described in the Service and Assessment Plan.
Bond" means any of the Bonds.
6
Bond Counsel" means McCall, Parkhurst & Horton L.L.P. or any other attorney or firm
of attorneys designated by the City that are nationally recognized for expertise in rendering
opinions as to the legality and tax-exempt status of securities issued by public entities.
Bond Fund" means the Fund established pursuant to Section 6.1 and administered
pursuant to Section 6.4 of this Indenture.
Bond Ordinance" means the ordinance adopted by the City Council on November 17,
2025 authorizing the issuance of the Bonds pursuant to this Indenture.
Bond Pledged Revenue Account" means the Account in the Pledged Revenue Fund
established pursuant to Section 6.1 of this Indenture.
Bond Year" means the one-year period beginning on October 1 in each year and ending
on September 30 in the following year.
Bonds" means the City’s bonds authorized to be issued by Section 3.1 of this Indenture
entitled "City of Anna, Texas, Special Assessment Revenue Bonds, Series 2025 (Crystal Park
Public Improvement District No. 2 Improvement Area #1 Project)" and, in the event the City
issues Refunding Bonds pursuant to Section 13.2 hereof, the term "Bonds" shall include such
Refunding Bonds.
Business Day" means any day other than a Saturday, Sunday or legal holiday in the State
observed as such by the City or the Trustee or any national holiday observed by the Trustee.
Capitalized Interest Account" means the Account in the Bond Fund established pursuant
to Section 6.1 of this Indenture.
Certification for Payment" means, with respect to payment or reimbursement of
Improvement Area #1 Projects, a certificate substantially in the form of Exhibit B attached to the
CFA Agreement and executed by a Person approved by the City Representative that is delivered
to the City Representative and the Trustee specifying the amount of work performed and the
Improvement Area #1 Projects thereof, and requesting payment for such Improvement Area #1
Projects from money on deposit in the Improvement Area #1 Bond Improvement Account of the
Project Fund as further described in the CFA Agreement and Section 6.5 of this Indenture.
CFA Agreement" means the “Crystal Park Public Improvement District No. 2
Improvement Area #1 Construction, Funding and Acquisition Agreement,” by and between the
City and the Developer, dated as of November 17, 2025, as may be amended and/or
supplemented from time to time, which provides, in part, for the construction and maintenance of
the Improvement Area #1 Projects, the issuance of the Bonds, and the payment or reimbursement
of costs of Improvement Area #1 Projects.
City Certificate" means written instructions by the City, executed by a City
Representative.
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City Representative" means that official or agent of the City authorized by the City
Council to undertake the action referenced herein.
Closing Disbursement Request” means the certificate, substantially in the form of
Exhibit A to the CFA Agreement or such other form agreed to by the Developer, Administrator,
and City Representative, executed by an engineer, construction manager or other person or entity
acceptable to the City, as evidenced by the signature of a City Representative, specifying the
amounts to be disbursed for the costs related to the creation of the District.
Code" means the Internal Revenue Code of 1986, as amended, including applicable
regulations, published rulings and court decisions.
Comptroller" means the Comptroller of Public Accounts of the State.
Costs of Issuance Account" means the Account in the Project Fund established pursuant
to Section 6.1 of this Indenture.
Defeasance Securities" means Investment Securities then authorized by applicable law
for the investment of funds to defease public securities.
Delinquency and Prepayment Reserve Account" means the reserve account administered
by the City and segregated from other funds of the City and established by Section 6.1 of this
Indenture.
Delinquency and Prepayment Reserve Requirement" means an amount equal to [__]% of
the principal amount of the Outstanding Bonds to be funded from the Additional Interest
deposited to the Pledged Revenue Fund and transferred to the Delinquency and Prepayment
Reserve Account.
Delinquent Collection Costs" mean costs related to the foreclosure on Improvement
Area #1 Assessed Property and the costs of collection of delinquent Improvement Area #1
Assessments, delinquent Improvement Area #1 Annual Installments, or any other delinquent
amounts due under the Service and Assessment Plan, including penalties and reasonable
attorney’s fees actually paid, but excluding amounts representing interest and penalty interest.
Delivery Date" means December 18, 2025, which is the date of delivery of the Bonds to
the initial purchaser or purchasers thereof against payment therefor.
Designated Payment/Transfer Office" means (i) with respect to the initial Paying
Agent/Registrar named in this Indenture, the transfer/payment office designated by the Paying
Agent/Registrar, which shall initially be located in Houston, Texas, and (ii) with respect to any
successor Paying Agent/Registrar, the office of such successor designated and located as may be
agreed upon by the City and such successor.
Developer" means Bloomfield Homes, L.P., a Texas limited partnership, and any
successor thereto.
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DTC" means The Depository Trust Company of New York, New York, or any successor
securities depository.
DTC Participant" means brokers and dealers, banks, trust companies, clearing
corporations, and certain other organizations on whose behalf DTC was created to hold securities
to facilitate the clearance and settlement of securities transactions among DTC Participants.
Foreclosure Proceeds" means the proceeds, including interest and penalty interest,
received by the City from the enforcement of the Improvement Area #1 Assessments against any
Improvement Area #1 Assessed Property, whether by foreclosure of lien or otherwise, but
excluding and net of all Delinquent Collection Costs.
Fund", in the singular, means any of the funds established pursuant to Section 6.1 of this
Indenture, and "Funds", in the plural, means, collectively, all of the funds established pursuant to
Section 6.1 of this Indenture.
Improvement Area #1" means that portion of the District generally described in Section
II of the Service and Assessment Plan and generally shown in Exhibit A-2 to the Service and
Assessment Plan and as specifically described in Exhibit J-2 to the Service and Assessment Plan.
Improvement Area #1 Annual Installments" means, with respect to each Parcel of
Improvement Area #1 Assessed Property, each annual payment of: (i) the principal of and
interest on the Improvement Area #1 Assessments as shown on the Improvement Area #1
Assessment Roll or in an Annual Service Plan Update, and as shown in Exhibit F-2 to the
Service and Assessment Plan, and calculated as provided in Section VI of the Service and
Assessment Plan, (ii) Annual Collection Costs and (iii) the Additional Interest.
Improvement Area #1 Assessed Property" means the property located in Improvement
Area #1 that benefits from the Improvement Area #1 Projects, and is defined as the
Improvement Area #1 Assessed Property" in the Service and Assessment Plan.
Improvement Area #1 Assessment Roll" means the "Improvement Area #1 Assessment
Roll", which document is attached to the Service and Assessment Plan as Exhibit F-1, as
updated, modified or amended from time to time.
Improvement Area #1 Assessments" means an assessment levied against Improvement
Area #1 Assessed Property based on the special benefit conferred on such Improvement Area #1
Assessed Property by the Improvement Area #1 Projects.
Improvement Area #1 Improvements" means the Authorized Improvements which only
benefit the Improvement Area #1 Assessed Property, as further described in Section III.B and
depicted on Exhibit G-2 to the Service and Assessment Plan.
Improvement Area #1 Project Costs" means the Actual Costs, as defined in the Service
and Assessment Plan (excluding Annual Collection Costs), solely for the Improvement Area #1
Projects.
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Improvement Area #1 Projects" means collectively, (1) the pro rata portion of the Major
Improvements allocable to Improvement Area #1; and (2) the Improvement Area #1
Improvements.
Indenture" means this Indenture of Trust as originally executed or as it may be from
time to time supplemented or amended by one or more indentures supplemental hereto and
entered into pursuant to the applicable provisions hereof.
Independent Financial Consultant" means any consultant or firm of such consultants
appointed by the City who, or each of whom: (i) is judged by the City, as the case may be, to
have experience in matters relating to the issuance and/or administration of the Bonds; (ii) is in
fact independent and not under the domination of the City; (iii) does not have any substantial
interest, direct or indirect, with or in the City, or any owner of real property in the District, or any
real property in the District; and (iv) is not connected with the City as an officer or employee of
the City, but who may be regularly retained to make reports to the City.
Initial Bonds" means the Initial Bonds authorized by Section 5.2 of this Indenture.
Interest Payment Date" means the date or dates upon which interest on the Bonds is
scheduled to be paid until their respective dates of maturity or prior redemption, such dates being
on March 15 and September 15 of each year, commencing September 15, 2026.
Investment Securities" means those authorized investments described in the Public
Funds Investment Act, Chapter 2256, Government Code, as amended, which investments are, at
the time made, included in and authorized by the City’s official investment policy as approved
by the City Council from time to time. Such Investment Securities may include money market
funds that are rated in either of the two highest categories by a rating agency, including funds for
which the Trustee and/or its affiliates provide investment advisory or other management
services; provided that such money market funds are authorized investments described in the
Public Funds Investment Act, Chapter 2256, Government Code, as amended.
Major Improvements" means the Authorized Improvements which benefit the entire
District, and are described in Section III.A and depicted on Exhibit G-1 to the Service and
Assessment Plan.
Maximum Annual Debt Service" means the largest Annual Debt Service for any Bond
Year after the calculation is made through the final maturity date of any Outstanding Bonds.
Other Obligations” means any bonds, temporary notes, time warrants, or an obligation
under an installment sale contract or reimbursement agreement secured in whole or in part by an
assessment, other than the Improvement Area #1 Assessments securing the Bonds, levied against
property within Improvement Area #1 in accordance with the PID Act.
Outstanding" means, as of any particular date when used with reference to Bonds, all
Bonds authenticated and delivered under this Indenture except (i) any Bond that has been
canceled by the Trustee (or has been delivered to the Trustee for cancellation) at or before such
date, (ii) any Bond for which the payment of the principal or Redemption Price of and interest on
such Bond shall have been made as provided in Article IV, (iii) any Bond in lieu of or in
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substitution for which a new Bond shall have been authenticated and delivered pursuant to
Section 3.10 of this Indenture and (iv) any Bond alleged to have been mutilated, destroyed, lost
or stolen which have been paid as provided in this Indenture.
Owner" means the Person who is the registered owner of a Bond or Bonds, as shown in
the Register, which shall be Cede & Co., as nominee for DTC, so long as the Bonds are in book-
entry only form and held by DTC as securities depository in accordance with Section 3.11 of this
Indenture.
Parcel" or "Parcels" means a parcel or parcels within the District identified by either a
tax map identification number assigned by the Collin Central Appraisal District for real property
tax purposes or by lot and block number in a final subdivision plat recorded in the real property
records of Collin County.
Paying Agent/Registrar" means initially the Trustee, or any successor thereto as
provided in this Indenture.
Person" or "Persons" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
PID Act" means the Public Improvement District Assessment Act, Subchapter A of
Chapter 372, Texas Local Government Code, as amended.
Pledged Funds" means, collectively, the Pledged Revenue Fund, the Bond Fund, the
Project Fund, the Reserve Fund and the Redemption Fund.
Pledged Revenue Fund" means that fund established pursuant to Section 6.1 of this
Indenture and administered pursuant to Section 6.3 of this Indenture.
Pledged Revenues" means, collectively, the (i) Assessment Revenues (excluding the
portion of the Improvement Area #1 Assessments and Improvement Area #1 Annual Installments
collected for the payment of Annual Collection Costs and Delinquent Collection Costs, as set
forth in the Service and Assessment Plan), (ii) the moneys held in any of the Pledged Funds and
iii) any additional revenues that the City may pledge to the payment of the Bonds.
Prepayment" means the payment of all or a portion of an Assessment before the due date
thereof. Amounts received at the time of a Prepayment which represent a payment of principal,
interest or penalties on a delinquent installment of an Assessment are not to be considered a
Prepayment, but rather are to be treated as the payment of the regularly scheduled Annual
Installment.
Principal and Interest Account" means the Account in the Bond Fund established
pursuant to Section 6.1 of this Indenture.
Project Fund" means that fund established pursuant to Section 6.1 and administered
pursuant to Section 6.5.
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Purchaser" means the initial purchaser of the Bonds.
Rebatable Arbitrage" means rebatable arbitrage as defined in Section 1.148-3 of the
Treasury Regulations.
Rebate Fund" means that Fund established pursuant to Section 6.1 of this Indenture and
administered pursuant to Section 6.8 of this Indenture.
Record Date" means the close of business on the last Business Day of the month next
preceding an Interest Payment Date.
Redemption Fund" means that Fund established pursuant to Section 6.1 of this Indenture
and administered pursuant to Section 6.6 of this Indenture.
Redemption Price" means, when used with respect to any Bond or portion thereof, the
principal amount of such Bond or such portion thereof plus the applicable premium, if any, plus
accrued and unpaid interest on such Bond to the date fixed for redemption payable upon
redemption thereof pursuant to this Indenture.
Refunding Bonds" means bonds issued to refund all or any portion of the Outstanding
Bonds and secured by a parity lien with the Outstanding Bonds on the Trust Estate, as more
specifically described in the Supplemental Indenture authorizing such Refunding Bonds.
Register" means the register specified in Article III of this Indenture.
Reserve Account" means the Account in the Reserve Fund established pursuant to
Section 6.1 of this Indenture.
Reserve Account Requirement" means the least of: (i) Maximum Annual Debt Service
on the Bonds as of the date of issuance, (ii) 125% of average Annual Debt Service on the Bonds
as of the date of issuance, and (iii) 10% of the proceeds of the Bonds; provided, however, that
such amount shall be reduced by the amount of any transfers made pursuant to Section 6.7(c);
and provided further that as a result of (1) an optional redemption pursuant to Section 4.3 or (2)
an extraordinary optional redemption pursuant to Section 4.4, the Reserve Account Requirement
shall be reduced by a percentage equal to the pro rata principal amount of Bonds redeemed by
such redemption divided by the total principal amount of the Outstanding Bonds prior to such
redemption. As of the Delivery Date, the Reserve Account Requirement is [$__________],
which is an amount equal to the Maximum Annual Debt Service defined above.
Reserve Fund" means that Fund established pursuant to Section 6.1 of this Indenture and
administered pursuant to Section 6.7 of this Indenture.
Reserve Fund Obligations" means cash or Investment Securities.
Service and Assessment Plan" means the document, including the Improvement Area #1
Assessment Roll, which is attached as Exhibit A to the Assessment Ordinance, as may be
updated, amended and supplemented from time to time.
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Sinking Fund Installment" means the amount of money to redeem or pay at maturity the
principal of a Stated Maturity of Bonds payable from such installments at the times and in the
amounts provided in Section 4.2 of this Indenture.
Special Record Date" has the meaning set forth in in the form of Bond included in
Section 5.2 hereof.
State" means the State of Texas.
Stated Maturity" means the date the Bonds, or any portion of the Bonds, as applicable,
are scheduled to mature without regard to any redemption or Prepayment.
Supplemental Indenture" means an indenture which has been duly executed by the
Trustee and a City Representative pursuant to an ordinance adopted by the City Council and
which indenture amends or supplements this Indenture, but only if and to the extent that such
indenture is specifically authorized hereunder.
Treasury Regulations" shall have the meaning assigned to such term in Section 7.5(c).
Trust Estate" means the Trust Estate described in the granting clauses of this Indenture.
Trustee" means Regions Bank, Houston, Texas, an Alabama state banking corporation
with offices in Houston, Texas and authorized to do business in the State, in its capacity as
trustee hereunder, and its successors, and any other corporation or association that may at any
time be substituted in its place, as provided in Article IX, such entity to serve as Trustee and
Paying Agent/Registrar for the Bonds.
Value of Investment Securities" means the amortized value of any Investment Securities,
provided, however, that all United States of America, United States Treasury Obligations – State
and Local Government Series shall be valued at par and those obligations which are redeemable
at the option of the holder shall be valued at the price at which such obligations are then
redeemable. The computations shall include accrued interest on the investment securities paid as
a part of the purchase price thereof and not collected. For the purposes of this definition
amortized value," when used with respect to a security purchased at par means the purchase
price of such security and when used with respect to a security purchased at a premium above or
discount below par, means as of any subsequent date of valuation, the value obtained by dividing
the total premium or discount by the number of interest payment dates remaining to maturity on
any such security after such purchase and by multiplying the amount as calculated by the number
of interest payment dates having passed since the date of purchase and (i) in the case of a
security purchased at a premium, by deducting the product thus obtained from the purchase
price, and (ii) in the case of a security purchased at a discount, by adding the product thus
obtained to the purchase price.
Section 1.2. Findings.
The declarations, determinations and findings declared, made and found in the preamble
to this Indenture are hereby adopted, restated and made a part of the operative provisions hereof.
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Section 1.3. Table of Contents, Titles and Headings.
The table of contents, titles, and headings of the Articles and Sections of this Indenture
have been inserted for convenience of reference only and are not to be considered a part hereof
and shall not in any way modify or restrict any of the terms or provisions hereof and shall never
be considered or given any effect in construing this Indenture or any provision hereof or in
ascertaining intent, if any question of intent should arise.
Section 1.4. Interpretation.
a) Unless the context requires otherwise, words of the masculine gender shall be
construed to include correlative words of the feminine and neuter genders and vice versa, and
words of the singular number shall be construed to include correlative words of the plural
number and vice versa.
b) Words importing persons include any individual, corporation, limited liability
company, partnership, joint venture, association, joint stock company, trust, unincorporated
organization or government or agency or political subdivision thereof.
c) Any reference to a particular Article or Section shall be to such Article or Section
of this Indenture unless the context shall require otherwise.
d) This Indenture and all the terms and provisions hereof shall be liberally construed
to effectuate the purposes set forth herein to sustain the validity of this Indenture.
ARTICLE II
THE BONDS
Section 2.1. Security for the Bonds.
a) The Bonds, as to principal, interest and redemption premium, if any, are and shall
be equally and ratably secured by and payable from a first lien on, security interest in, and pledge
of the Trust Estate.
b) The lien on, security interest in and pledge of the Trust Estate shall be valid and
binding and fully perfected from and after the Delivery Date, without physical delivery or
transfer of control of the Trust Estate, the filing of this Indenture or any other act; all as provided
in Chapter 1208 of the Texas Government Code, as amended, which applies to the issuance of
the Bonds and the pledge of the Trust Estate granted by the City under this Indenture, and such
pledge is therefore valid, effective and perfected. If State law is amended at any time while the
Bonds are Outstanding such that the pledge of the Trust Estate granted by the City under this
Indenture is to be subject to the filing requirements of Chapter 9, Business and Commerce Code,
then in order to preserve to the registered owners of the Bonds the perfection of the security
interest in said pledge, the City agrees to take such measures as it determines are reasonable and
necessary under State law to comply with the applicable provisions of Chapter 9, Business and
Commerce Code and enable a filing to perfect the security interest in said pledge to occur.
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Section 2.2. Limited Obligations.
The Bonds are special and limited obligations of the City, payable solely from and
secured solely by the Trust Estate; and the Bonds shall never be payable out of funds raised or to
be raised by taxation or from any other revenues, properties or income of the City.
Section 2.3. Authorization for Indenture.
The terms and provisions of this Indenture and the execution and delivery hereof by the
City to the Trustee have been duly authorized by official action of the City Council. The City
has ascertained and it is hereby determined and declared that the execution and delivery of this
Indenture is necessary to carry out and effectuate the purposes set forth in the preambles of this
Indenture and that each and every covenant or agreement herein contained and made is
necessary, useful and/or convenient in order to better secure the Bonds and is a contract or
agreement necessary, useful and/or convenient to carry out and effectuate the purposes herein
described.
Section 2.4. Contract with Owners and Trustee.
a) The purposes of this Indenture are to establish a lien and the security for, and to
prescribe the minimum standards for the authorization, issuance, execution and delivery of, the
Bonds and to prescribe the rights of the Owners, and the rights and duties of the City and the
Trustee.
b) In consideration of the purchase and acceptance of any or all of the Bonds by
those who shall purchase and hold the same from time to time, the provisions of this Indenture
shall be a part of the contract of the City with the Owners, and shall be deemed to be and shall
constitute a contract among the City, the Owners, and the Trustee.
ARTICLE III
AUTHORIZATION; GENERAL TERMS AND PROVISIONS REGARDING THE
BONDS
Section 3.1. Authorization.
The Bonds are hereby authorized to be issued and delivered in accordance with the
Constitution and laws of the State, including particularly the PID Act. The Bonds shall be issued
in the aggregate principal amount of [$__________] for the purpose of (i) paying a portion of the
Improvement Area #1 Project Costs, (ii) paying a portion of the interest on the Bonds during and
after the period of acquisition and construction of the Improvement Area #1 Projects, (iii)
funding a reserve fund for payment of principal and interest on the Bonds, (iv) paying a portion
of the costs incidental to the organization of the District and (v) paying the costs of issuance of
the Bonds.
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Section 3.2. Date, Denomination, Maturities, Numbers and Interest.
a) The Bonds shall be dated the Delivery Date and shall be issued in Authorized
Denominations. The Bonds shall be in fully registered form, without coupons, and shall be
numbered separately from R-1 upward, except the Initial Bond, which shall be numbered T-1.
b) Interest shall accrue and be paid on each Bond from the later of the Delivery Date
or the most recent Interest Payment Date to which interest has been paid or provided for, at the
rate per annum set forth below until the principal thereof has been paid on the maturity date
specified below, or on a date of earlier redemption, or otherwise provided for. Such interest shall
be payable semiannually on March 15 and September 15 of each year, commencing September
15, 2026, computed on the basis of a 360-day year of twelve 30-day months.
c) The Bonds shall mature on September 15 in the years and in the principal
amounts and shall bear interest at the rates set forth below:
Yea
Principal
Amount
Interest
Rate
20
20
20
d) The Bonds shall be subject to mandatory sinking fund redemption, optional
redemption, and extraordinary optional redemption prior to maturity as provided in Article IV,
and shall otherwise have the terms, tenor, denominations, details, and specifications as set forth
in the form of Bond set forth in Section 5.2.
Section 3.3. Conditions Precedent to Delivery of Bonds.
The Bonds shall be executed by the City and delivered to the Trustee, whereupon the
Trustee shall authenticate the Bonds and, upon payment of the purchase price of the Bonds, shall
deliver the Bonds upon the order of the City, but only upon delivery to the Trustee of:
a) a certified copy of the Assessment Ordinance;
b) a certified copy of the Bond Ordinance;
c) a copy of the executed CFA Agreement with all executed amendments thereto;
d) a copy of this Indenture executed by the Trustee and the City;
e) an executed City Certificate directing the authentication and delivery of the
Bonds, describing the Bonds to be authenticated and delivered, designating the purchasers to
whom the Bonds are to be delivered, stating the purchase price of the Bonds and stating that all
items required by this Section are therewith delivered to the Trustee;
f) an executed Signature and No-Litigation Certificate;
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g) an executed opinion of Bond Counsel; and
h) the approving opinion of the Attorney General of the State and the State
Comptroller’s registration certificate.
Section 3.4. Medium, Method and Place of Payment.
a) Principal of and interest on the Bonds shall be paid in lawful money of the United
States of America, as provided in this Section.
b) Interest on the Bonds shall be payable to the Owners thereof as shown in the
Register at the close of business on the relevant Record Date or Special Record Date, as
applicable.
c) Interest on the Bonds shall be paid by check, dated as of the Interest Payment
Date, and sent, first class United States mail, postage prepaid, by the Paying Agent/Registrar to
each Owner at the address of each as such appears in the Register or by such other customary
banking arrangement acceptable to the Paying Agent/Registrar and the Owner; provided,
however, the Owner shall bear all risk and expense of such other banking arrangement.
d) The principal of each Bond shall be paid to the Owner of such Bond on the due
date thereof, whether at the maturity date or the date of prior redemption thereof, upon
presentation and surrender of such Bond at the Designated Payment/Transfer Office of the
Paying Agent/Registrar.
e) If the date for the payment of the principal of or interest on the Bonds shall be a
Saturday, Sunday, legal holiday, or day on which banking institutions in the city where the
Designated Payment/Transfer Office of the Paying Agent/Registrar is located are required or
authorized by law or executive order to close, the date for such payment shall be the next
succeeding day that is not a Saturday, Sunday, legal holiday, or day on which banking
institutions are required or authorized to close, and payment on such date shall for all purposes
be deemed to have been made on the due date thereof as specified in Section 3.2 of this
Indenture.
f) Unclaimed payments of amounts due hereunder shall be segregated in a special
account and held in trust, uninvested by the Paying Agent/Registrar, for the account of the
Owner of the Bonds to which such unclaimed payments pertain. Subject to any escheat,
abandoned property, or similar law of the State, any such payments remaining unclaimed by the
Owners entitled thereto for three (3) years after the applicable payment or redemption date shall
be applied to the next payment or payments on the Bonds thereafter coming due and, to the
extent any such money remains after the retirement of all Outstanding Bonds, shall be paid to the
City to be used for any lawful purpose. Thereafter, none of the City, the Paying Agent/Registrar,
or any other Person shall be liable or responsible to any holders of such Bonds for any further
payment of such unclaimed moneys or on account of any such Bonds, subject to any applicable
escheat law or similar law of the State.
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Section 3.5. Execution and Registration of Bonds.
a) The Bonds shall be executed on behalf of the City by the Mayor (or in the
Mayor’s absence, the Mayor Pro-Tem) and City Secretary, by their manual or facsimile
signatures, and the official seal of the City shall be impressed or placed in facsimile thereon such
facsimile signatures on the Bonds shall have the same effect as if each of the Bonds had been
signed manually and in person by each of said officers, and such facsimile seal on the Bonds
shall have the same effect as if the official seal of the City had been manually impressed upon
each of the Bonds.
b) In the event that any officer of the City whose manual or facsimile signature
appears on the Bonds ceases to be such officer before the authentication of such Bonds or before
the delivery thereof, such manual or facsimile signature nevertheless shall be valid and sufficient
for all purposes as if such officer had remained in such office.
c) Except as provided below, no Bond shall be valid or obligatory for any purpose or
be entitled to any security or benefit of this Indenture unless and until there appears thereon the
Certificate of Trustee substantially in the form provided herein, duly authenticated by manual
execution by an officer or duly authorized signatory of the Trustee. It shall not be required that
the same officer or authorized signatory of the Trustee sign the Certificate of Trustee on all of
the Bonds. In lieu of the executed Certificate of Trustee described above, the Initial Bond
delivered on the Delivery Date shall have attached thereto the Comptroller’s Registration
Certificate substantially in the form provided herein, manually executed by the Comptroller, or
by his duly authorized agent, which certificate shall be evidence that the Initial Bond has been
duly approved by the Attorney General, is a valid and binding obligation of the City, and has
been registered by the Comptroller.
d) On the Delivery Date, one Initial Bond representing the entire principal amount of
all Bonds, payable in stated installments to the Purchaser, or its designee, executed with the
manual or facsimile signatures of the Mayor (or in the Mayor’s Absence, the Mayor Pro-Tem)
and the City Secretary, approved by the Attorney General, and registered and manually signed by
the Comptroller, will be delivered to the Purchaser or its designee. Upon payment for the Initial
Bond, the Trustee shall cancel the Initial Bond and deliver to DTC on behalf of the Purchaser
one registered definitive Bond for each year of maturity of the Bonds, in the aggregate principal
amount of all Bonds for such maturity, registered in the name of Cede & Co., as nominee of
DTC.
Section 3.6 Refunding Bonds.
a) Except in accordance with the provisions of this Indenture, including Section
13.2, the City shall not issue additional bonds, notes or other obligations payable from any
portion of the Trust Estate, other than Refunding Bonds. The City reserves the right to issue
Refunding Bonds, the proceeds of which would be utilized to refund all or any portion of the
Outstanding Bonds or Outstanding Refunding Bonds and to pay all costs incident to the
Refunding Bonds, as authorized by the laws of the State of Texas. Except as limited by the
terms of this Indenture, including Section 13.2, the City reserves the right to incur debt payable
from sources other than the Trust Estate, including revenue derived from contracts with other
entities, including private corporations, municipalities and political subdivisions issued
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particularly for the purchase, construction, improvement, extension, replacement, enlargement or
repair of the facilities needed in performing any such contract.
b) The principal of all Refunding Bonds must be scheduled to be paid, be subject to
mandatory sinking fund redemption or mature on September 15 of the years in which such
principal is scheduled to be paid. All Refunding Bonds must bear interest at a fixed rate and any
interest payment dates for Refunding Bonds must be March 15 and September 15. The date, rate
or rates of interest on, interest payment dates, maturity dates, redemption and all other terms and
provisions of Refunding Bonds shall be set forth in a Supplemental Indenture.
c) Upon their authorization by the City, the Refunding Bonds of a series issued
under this Section 3.6 and in accordance with Article IV hereof shall be issued and shall be
delivered to the purchasers or owners thereof, but before, or concurrently with, the delivery of
said Refunding Bonds to such purchasers or owners there shall have been filed with the Trustee
the items required by Section 3.3 above.
Section 3.7. Ownership.
a) The City, the Trustee, the Paying Agent/Registrar and any other Person may treat
the Person in whose name any Bond is registered as the absolute owner of such Bond for the
purpose of making and receiving payment as provided herein (except interest shall be paid to the
Person in whose name such Bond is registered on the Record Date or Special Record Date, as
applicable) and for all other purposes, whether or not such Bond is overdue, and none of the
City, the Trustee or the Paying Agent/Registrar shall be bound by any notice or knowledge to the
contrary.
b) All payments made to the Owner of any Bond shall be valid and effectual and
shall discharge the liability of the City, the Trustee and the Paying Agent/Registrar upon such
Bond to the extent of the sums paid.
Section 3.8. Registration, Transfer and Exchange.
a) So long as any Bond remains Outstanding, the City shall cause the Paying
Agent/Registrar to keep at the Designated Payment/Transfer Office a Register in which, subject
to such reasonable regulations as it may prescribe, the Paying Agent/Registrar shall provide for
the registration and transfer of Bonds in accordance with this Indenture. The Paying
Agent/Registrar represents and warrants that it will maintain a copy of the Register, and shall
cause the Register to be current with all registration and transfer information as from time to time
may be applicable.
b) A Bond shall be transferable only upon the presentation and surrender thereof at
the Designated Payment/Transfer Office of the Paying Agent/Registrar with such endorsement or
other evidence of transfer as is acceptable to the Paying Agent/Registrar. No transfer of any
Bond shall be effective until entered in the Register.
c) The Bonds shall be exchangeable upon the presentation and surrender thereof at
the Designated Payment/Transfer Office of the Paying Agent/Registrar for a Bond or Bonds of
the same maturity and interest rate and in any Authorized Denomination and in an aggregate
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principal amount equal to the unpaid principal amount of the Bond presented for exchange. The
Trustee is hereby authorized to authenticate and deliver Bonds exchanged for other Bonds in
accordance with this Section.
d) The Trustee is hereby authorized to authenticate and deliver Bonds transferred or
exchanged in accordance with this Section. A new Bond or Bonds will be delivered by the
Paying Agent/Registrar, in lieu of the Bond being transferred or exchanged, at the Designated
Payment/Transfer Office, or sent by United States mail, first class, postage prepaid, to the Owner
or his designee. Each transferred Bond delivered by the Paying Agent/Registrar in accordance
with this Section shall constitute an original contractual obligation of the City and shall be
entitled to the benefits and security of this Indenture to the same extent as the Bond or Bonds in
lieu of which such transferred Bond is delivered.
e) Each exchange Bond delivered in accordance with this Section shall constitute an
original contractual obligation of the City and shall be entitled to the benefits and security of this
Indenture to the same extent as the Bond or Bonds in lieu of which such exchange Bond is
delivered.
f) No service charge shall be made to the Owner for the initial registration,
subsequent transfer, or exchange for a different Authorized Denomination of any of the Bonds.
The Paying Agent/Registrar, however, may require the Owner to pay a sum sufficient to cover
any tax or other governmental charge that is authorized to be imposed in connection with the
registration, transfer, or exchange of a Bond.
g) Neither the City nor the Paying Agent/Registrar shall be required to issue,
transfer, or exchange any Bond or portion thereof called for redemption prior to maturity within
forty-five (45) days prior to the date fixed for redemption; provided, however, such limitation
shall not be applicable to an exchange by the Owner of the uncalled principal balance of a Bond.
Section 3.9. Cancellation.
All Bonds paid or redeemed before scheduled maturity in accordance with this Indenture,
and all Bonds in lieu of which exchange Bonds or replacement Bonds are authenticated and
delivered in accordance with this Indenture, shall be cancelled, and proper records shall be made
regarding such payment, redemption, exchange, or replacement. Whenever in this Indenture
provision is made for the cancellation by the Trustee of any Bonds, the Trustee shall dispose of
cancelled Bonds in accordance with its record retention policies.
Section 3.10. Temporary Bonds.
a) Following the delivery and registration of the Initial Bond and pending the
preparation of definitive Bonds, the proper officers of the City may execute and, upon the City’s
request, the Trustee shall authenticate and deliver, one or more temporary Bonds that are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any Authorized
Denomination, substantially of the tenor of the definitive Bonds in lieu of which they are
delivered, without coupons, and with such appropriate insertions, omissions, substitutions and
other variations as the officers of the City executing such temporary Bonds may determine, as
evidenced by their signing of such temporary Bonds.
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b) Until exchanged for Bonds in definitive form, such Bonds in temporary form shall
be entitled to the benefit and security of this Indenture.
c) The City, without unreasonable delay, shall prepare, execute and deliver to the
Trustee the Bonds in definitive form; thereupon, upon the presentation and surrender of the Bond
or Bonds in temporary form to the Paying Agent/Registrar, the Paying Agent/Registrar shall
cancel the Bonds in temporary form and the Trustee shall authenticate and deliver in exchange
therefor a Bond or Bonds of the same maturity and series, in definitive form, in the Authorized
Denomination, and in the same aggregate principal amount, as the Bond or Bonds in temporary
form surrendered. Such exchange shall be made without the making of any charge therefor to
any Owner.
Section 3.11. Replacement Bonds.
a) Upon the presentation and surrender to the Paying Agent/Registrar of a mutilated
Bond, the City shall issue and the Trustee shall authenticate and deliver in exchange therefor a
replacement Bond of like tenor and principal amount, bearing a number not contemporaneously
outstanding. The City or the Paying Agent/Registrar may require the Owner of such Bond to pay
a sum sufficient to cover any tax or other governmental charge that is authorized to be imposed
in connection therewith and any other expenses connected therewith.
b) In the event that any Bond is lost, apparently destroyed or wrongfully taken, the
City shall issue and the Trustee, pursuant to the applicable laws of the State and in the absence of
notice or knowledge that such Bond has been acquired by a bona fide purchaser, shall
authenticate and deliver a replacement Bond of like tenor and principal amount bearing a number
not contemporaneously outstanding, provided that the Owner first complies with the following
requirements:
i) furnishes to the Paying Agent/Registrar satisfactory evidence of his or her
ownership of and the circumstances of the loss, destruction or theft of such Bond;
ii) furnishes such security or indemnity as may be required by the Paying
Agent/Registrar and the Trustee to save them and the City harmless;
iii) pays all expenses and charges in connection therewith, including, but not
limited to, printing costs, legal fees, fees of the Trustee and the Paying Agent/Registrar
and any tax or other governmental charge that is authorized to be imposed; and
iv) satisfies any other reasonable requirements imposed by the City and the
Trustee.
c) After the delivery of such replacement Bond, if a bona fide purchaser of the
original Bond in lieu of which such replacement Bond was issued presents for payment such
original Bond, the City and the Paying Agent/Registrar shall be entitled to recover such
replacement Bond from the Person to whom it was delivered or any Person taking therefrom,
except a bona fide purchaser, and shall be entitled to recover upon the security or indemnity
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provided therefor to the extent of any loss, damage, cost, or expense incurred by the City, the
Paying Agent/Registrar or the Trustee in connection therewith.
d) In the event that any such mutilated, lost, apparently destroyed or wrongfully
taken Bond has become or is about to become due and payable, the Paying Agent/Registrar, in its
discretion, instead of issuing a replacement Bond, may pay such Bond if it has become due and
payable or may pay such Bond when it becomes due and payable.
e) Each replacement Bond delivered in accordance with this Section shall constitute
an original additional contractual obligation of the City and shall be entitled to the benefits and
security of this Indenture to the same extent as the Bond or Bonds in lieu of which such
replacement Bond is delivered.
Section 3.12. Book-Entry-Only System.
a) The Bonds shall initially be issued in book-entry-only form and shall be deposited
with DTC, which is hereby appointed to act as the securities depository therefor, in accordance
with the blanket issuer letter of representations from the City to DTC. On the Delivery Date, the
definitive Bonds shall be issued in the form of a single typewritten certificate for each maturity
thereof registered in the name of Cede & Co., as nominee for DTC.
b) With respect to Bonds registered in the name of Cede & Co., as nominee of DTC,
the City and the Paying Agent/Registrar shall have no responsibility or obligation to any DTC
Participant or to any Person on behalf of whom such a DTC Participant holds an interest in the
Bonds. Without limiting the immediately preceding sentence, the City and the Paying
Agent/Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the
records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in
the Bonds, (ii) the delivery to any DTC Participant or any other Person, other than an Owner, as
shown on the Register, of any notice with respect to the Bonds, including any notice of
redemption, or (iii) the payment to any DTC Participant or any other Person, other than an
Owner, as shown in the Register of any amount with respect to principal of, premium, if any, or
interest on the Bonds. Notwithstanding any other provision of this Indenture to the contrary, the
City and the Paying Agent/Registrar shall be entitled to treat and consider the Person in whose
name each Bond is registered in the Register as the absolute owner of such Bond for the purpose
of payment of principal of, premium, if any, and interest on Bonds, for the purpose of giving
notices of redemption and other matters with respect to such Bond, for the purpose of registering
transfer with respect to such Bond, and for all other purposes whatsoever. The Paying
Agent/Registrar shall pay all principal of, premium, if any, and interest on the Bonds only to or
upon the order of the respective Owners as shown in the Register, as provided in this Indenture,
and all such payments shall be valid and effective to fully satisfy and discharge the City’s
obligations with respect to payment of principal of, premium, if any, and interest on the Bonds to
the extent of the sum or sums so paid. No Person other than an Owner, as shown in the Register,
shall receive a Bond certificate evidencing the obligation of the City to make payments of
amounts due pursuant to this Indenture. Upon delivery by DTC to the Paying Agent/Registrar 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 in this Indenture with respect to interest checks or
drafts being mailed to the registered owner at the close of business on the Record Date or Special
22
Record Date, as applicable, the word "Cede & Co." in this Indenture shall refer to such new
nominee of DTC.
Section 3.13. Successor Securities Depository: Transfer Outside Book-Entry-Only
System.
In the event that the City determines that DTC is incapable of discharging its
responsibilities described herein and in the blanket issuer letter of representations from the City
to DTC, the City shall (i) appoint a successor securities depository, qualified to act as such under
Section 17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC
Participants of the appointment of such successor securities depository and transfer one or more
separate Bonds to such successor securities depository; or (ii) notify DTC and DTC Participants
of the availability through DTC of certificated Bonds and cause the Paying Agent/Registrar to
transfer one or more separate registered Bonds to DTC Participants having Bonds credited to
their DTC accounts. In such event, the Bonds shall no longer be restricted to being registered in
the Register in the name of Cede & Co., as nominee of DTC, but may be registered in the name
of the successor securities depository, or its nominee, or in whatever name or names Owners
transferring or exchanging Bonds shall designate, in accordance with the provisions of this
Indenture.
Section 3.14. Payments to Cede & Co.
Notwithstanding any other provision of this Indenture to the contrary, so long as any
Bonds are registered in the name of Cede & Co., as nominee of DTC, all payments with respect
to principal of, premium, if any, and interest on such Bonds, and all notices with respect to such
Bonds shall be made and given, respectively, in the manner provided in the blanket letter of
representations from the City to DTC.
ARTICLE IV
REDEMPTION OF BONDS BEFORE MATURITY
Section 4.1. Limitation on Redemption.
The Bonds shall be subject to redemption before their scheduled maturity only as
provided in this Article IV.
Section 4.2. Mandatory Sinking Fund Redemption.
a) The Bonds maturing on September 15 in each of the years 20__, 20__ and 20__
collectively, the “Term Bonds”), are subject to mandatory sinking fund redemption prior to their
respective maturities and will be redeemed by the City in part at the Redemption Price from
moneys available for such purpose in the Principal and Interest Account of the Bond Fund
pursuant to Article VI, on the dates and in the respective Sinking Fund Installments as set forth
in the following schedule:
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Term Bonds maturing September 15, 20__
Redemption Date Sinkin Fund Installment Amount
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20 *
Term Bonds maturing September 15, 20__
Redemption Date Sinkin Fund Installment Amount
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20 *
Term Bonds maturing September 15, 20__
Redemption Date Sinkin Fund Installment Amount
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20 *
Stated Maturity.
b) At least thirty (30) days prior to each mandatory sinking fund redemption date,
and subject to any prior reduction authorized by this Indenture, the Trustee shall select by lot, or
by any other customary method that results in a random selection, a principal amount of Bonds
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of such maturity equal to the Sinking Fund Installment amount of such Bonds to be redeemed,
shall call such Bonds for redemption on such scheduled mandatory sinking fund redemption
date, and shall give notice of such mandatory sinking fund redemption, as provided in Section
4.6.
c) The principal amount of Bonds required to be redeemed on any mandatory
sinking fund redemption date pursuant to subparagraph (a) of this Section 4.2 shall be reduced, at
the option of the City, by the principal amount of any Bonds of such maturity which, at least 30
days prior to the mandatory sinking fund redemption date shall have been acquired by the City at
a price not exceeding the principal amount of such Bonds plus accrued unpaid interest to the date
of purchase thereof, and delivered to the Trustee for cancellation.
d) The Sinking Fund Installments of Term Bonds required to be redeemed on any
mandatory sinking fund redemption date pursuant to subparagraph (a) of this Section 4.2 shall be
reduced in integral multiples of $1,000 by any portion of such Bonds, which, at least 30 days
prior to the mandatory sinking fund redemption date, shall have been redeemed pursuant to the
optional redemption or extraordinary optional redemption provisions in Sections 4.3 and 4.4,
respectively, hereof, and not previously credited to a mandatory sinking fund redemption.
Section 4.3. Optional Redemption.
The City reserves the right and option to redeem Bonds before their scheduled maturity
date, in whole or in part, on any date on or after September 15, 20__, such redemption date or
dates to be fixed by the City, at the Redemption Price.
Section 4.4. Extraordinary Optional Redemption.
The City reserves the right and option to redeem Bonds before their respective scheduled
maturity dates, in whole or in part, on any date, at the Redemption Price, from amounts on
deposit in the Redemption Fund as a result of Prepayments (including related transfers to the
Redemption Fund as provided in Section 6.7(c)) or any other transfers to the Redemption Fund
under the terms of this Indenture.
Section 4.5. Partial Redemption.
a) If less than all of the Bonds are to be redeemed pursuant to either Sections 4.2, 4.3
or 4.4, Bonds may be redeemed in minimum principal amounts of $1,000 or any integral thereof.
Each Bond shall be treated as representing the number of Bonds that is obtained by dividing the
principal amount of such Bond by $1,000. No redemption shall result in a Bond in a
denomination of less than an Authorized Denomination; provided, however, if the amount of
Outstanding Bonds is less than an Authorized Denomination after giving effect to such partial
redemption, a Bond in the principal amount equal to the unredeemed portion, but not less than
1,000, may be issued.
b) If less than all of the Bonds are called for optional redemption pursuant to Section
4.3 hereof, the Trustee shall rely on directions provided in a City Certificate in selecting the
Bonds to be redeemed.
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c) If less than all of the Bonds are called for extraordinary optional redemption
pursuant to Section 4.4 hereof, the Bonds or portion of a Bond to be redeemed shall be allocated
on a pro rata basis (as nearly as practicable) among all Outstanding Bonds. If less than all Bonds
within a Stated Maturity are called for extraordinary optional redemption pursuant to Section 4.4
hereof, the Trustee shall call randomly by lot the Bonds, or portions thereof, within such Stated
Maturity and in such principal amounts, for redemption.
d) Upon surrender of any Bond for redemption in part, the Trustee in accordance
with Section 3.7 of this Indenture, shall authenticate and deliver an exchange Bond or Bonds in
an aggregate principal amount equal to the unredeemed portion of the Bond so surrendered, such
exchange being without charge.
Section 4.6. Notice of Redemption to Owners.
a) Upon written direction from the City to the Trustee of the exercise of any
redemption provision provided hereunder, the Trustee shall give notice of any redemption of
Bonds by sending notice by first class United States mail, postage prepaid, not less than 30 days
before the date fixed for redemption, to the Owner of each Bond or portion thereof to be
redeemed, at the address shown in the Register.
b) The notice shall state the redemption date, the Redemption Price, the place at
which the Bonds are to be surrendered for payment, and, if less than all the Bonds Outstanding
are to be redeemed, and subject to Section 4.5, an identification of the Bonds or portions thereof
to be redeemed, any conditions to such redemption and that on the redemption date, if all
conditions, if any, to such redemption have been satisfied, such Bond shall become due and
payable.
c) Any notice given as provided in this Section shall be conclusively presumed to
have been duly given, whether or not the Owner receives such notice.
d) With respect to any optional redemption of the Bonds, unless the Trustee has
received funds sufficient to pay the Redemption Price of the Bonds to be redeemed before giving
of a notice of redemption, the notice may state the City may condition redemption on the receipt
of such funds by the Trustee on or before the date fixed for the redemption, or on the satisfaction
of any other prerequisites set forth in the notice of redemption. If a conditional notice of
redemption is given and such prerequisites to the redemption and sufficient funds are not
received, the notice shall be of no force and effect, the City shall not redeem the Bonds and the
Trustee shall give notice, in the manner in which the notice of redemption was given, that the
Bonds have not been redeemed.
e) The City has the right to rescind any optional redemption or extraordinary
optional redemption described in Section 4.3 or 4.4 by written notice to the Trustee on or prior to
the date fixed for redemption. Any notice of redemption shall be cancelled and annulled if for
any reason funds are not available on the date fixed for redemption for the payment in full of the
Bonds then called for redemption, and such cancellation shall not constitute an Event of Default
under this Indenture. Upon written direction from the City, the Trustee shall mail notice of
rescission of redemption in the same manner notice of redemption was originally provided.
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Section 4.7. Payment Upon Redemption.
a) The Trustee shall make provision for the payment of the Bonds to be redeemed on
such date by setting aside and holding in trust an amount from the Redemption Fund or
otherwise received by the Trustee from the City and shall use such funds solely for the purpose
of paying the Redemption Price on the Bonds being redeemed.
b) Upon presentation and surrender of any Bond called for redemption at the
designated corporate trust office of the Trustee on or after the date fixed for redemption, the
Trustee shall pay the Redemption Price on such Bond to the date of redemption from the moneys
set aside for such purpose.
Section 4.8. Effect of Redemption.
Notice of redemption having been given as provided in Section 4.6 of this Indenture, the
Bonds or portions thereof called for redemption shall become due and payable on the date fixed
for redemption provided that funds for the payment of the Redemption Price of such Bonds to
the date fixed for redemption are on deposit with the Trustee; thereafter, such Bonds or portions
thereof shall cease to bear interest from and after the date fixed for redemption, whether or not
such Bonds are presented and surrendered for payment on such date.
ARTICLE V
FORM OF THE BONDS
Section 5.1. Form Generally.
a) The Bonds, including the Registration Certificate of the Comptroller, the
Certificate of the Trustee, and the Assignment to appear on each of the Bonds, (i) shall be
substantially in the form set forth in this Article with such appropriate insertions, omissions,
substitutions, and other variations as are permitted or required by this Indenture, and (ii) may
have such letters, numbers, or other marks of identification (including identifying numbers and
letters of the Committee on Uniform Securities Identification Procedures of the American
Bankers Association) and such legends and endorsements (including any reproduction of an
opinion of counsel) thereon as, consistently herewith, may be determined by the City or by the
officers executing such Bonds, as evidenced by their execution thereof.
b) Any portion of the text of any Bonds may be set forth on the reverse side thereof,
with an appropriate reference thereto on the face of the Bonds.
c) The definitive Bonds shall be typewritten, printed, lithographed, or engraved, and
may be produced by any combination of these methods or produced in any other similar manner,
all as determined by the officers executing such Bonds, as evidenced by their execution thereof.
d) The Initial Bond submitted to the Attorney General may be typewritten and
photocopied or otherwise reproduced.
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Section 5.2. Form of the Bonds.
a) Form of Bond.
REGISTERED
NO. ______
United States of America
State of Texas
CITY OF ANNA, TEXAS
SPECIAL ASSESSMENT REVENUE BOND, SERIES 2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT
NO. 2 IMPROVEMENT AREA #1 PROJECT)
REGISTERED
INTEREST RATE MATURITY DATE DELIVERY DATE CUSIP NUMBER
September 15, 20__ December 18, 2025 __________
The City of Anna, Texas (the "City"), for value received, hereby promises to pay, solely
from the Trust Estate, to
or registered assigns, on the Maturity Date, as specified above, the sum of
DOLLARS
unless this Bond shall have been sooner called for redemption and the payment of the principal
hereof shall have been paid or provision for such payment shall have been made, and to pay
interest on the unpaid principal amount hereof from the later of the Delivery Date, as specified
above, or the most recent Interest Payment Date to which interest has been paid or provided for
until such principal amount shall have been paid or provided for, at the per annum rate of interest
specified above, computed on the basis of a 360-day year of twelve 30-day months, such interest
to be paid semiannually on March 15 and September 15 of each year, commencing September
15, 2026.
Capitalized terms appearing herein that are defined terms in the Indenture (defined
below) have the meanings assigned to them in the Indenture. Reference is made to the Indenture
for such definitions and for all other purposes.
The principal of this Bond shall be payable without exchange or collection charges in
lawful money of the United States of America upon presentation and surrender of this Bond at
the corporate trust office in Houston, Texas (the "Designated Payment/Transfer Office"), of
NEITHER THE FAITH AND CREDIT NOR THE TAXING
POWER OF THE STATE OF TEXAS, THE CITY, OR ANY
OTHER POLITICAL CORPORATION, SUBDIVISION OR
AGENCY THEREOF, IS PLEDGED TO THE PAYMENT
OF THE PRINCIPAL OF OR INTEREST ON THIS BOND.
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Regions Bank, as trustee and paying agent/registrar (the "Trustee"), or, with respect to a
successor trustee and paying agent/registrar, at the Designated Payment/Transfer Office of such
successor. Interest on this Bond is payable by check dated as of the Interest Payment Date,
mailed by the Trustee to the registered owner at the address shown on the registration books kept
by the Trustee or by such other customary banking arrangements acceptable to the Trustee,
requested by, and at the risk and expense of, the Person to whom interest is to be paid. For the
purpose of the payment of interest on this Bond, the registered owner shall be the Person in
whose name this Bond is registered at the close of business on the "Record Date," which shall be
the close of business on the last business day of the month next preceding such Interest Payment
Date; provided, however, that in the event of nonpayment of interest on a scheduled Interest
Payment Date, and for 30 days thereafter, a new record date for such interest payment (a
Special Record Date") will be established by the Trustee, if and when funds for the payment of
such interest have been received from the City. Notice of the Special Record Date and of the
scheduled payment date of the past due interest (which shall be 15 days after the Special Record
Date) shall be sent at least five Business Days prior to the Special Record Date by United States
mail, first class postage prepaid, to the address of each Owner of a Bond appearing on the books
of the Trustee at the close of business on the last Business Day preceding the date of mailing
such notice.
If a date for the payment of the principal of or interest on the Bonds is a Saturday,
Sunday, legal holiday, or a day on which banking institutions in the city in which the Designated
Payment/Transfer Office is located are authorized by law or executive order to close, then the
date for such payment shall be the next succeeding Business Day, and payment on such date
shall have the same force and effect as if made on the original date payment was due.
This Bond is one of a duly authorized issue of assessment revenue bonds of the City
having the designation specified in its title (herein referred to as the "Bonds"), dated as of the
Delivery Date and issued in the aggregate principal amount of [$__________] and issued, with
the limitations described herein, pursuant to an Indenture of Trust, dated as of November 15,
2025 (the "Indenture"), by and between the City and the Trustee, to which Indenture reference is
hereby made for a description of the amounts thereby pledged and assigned, the nature and
extent of the lien and security, the respective rights thereunder to the holders of the Bonds, the
Trustee, and the City, and the terms upon which the Bonds are, and are to be, authenticated and
delivered and by this reference to the terms of which each holder of this Bond hereby consents.
All Bonds issued under the Indenture are equally and ratably secured by the amounts thereby
pledged and assigned. The Bonds are being issued for the purpose of (i) paying a portion of the
Improvement Area #1 Project Costs, (ii) paying a portion of the interest on the Bonds during and
after the period of acquisition and construction of the Improvement Area #1 Projects, (iii)
funding a reserve fund for payment of principal and interest on the Bonds, (iv) paying a portion
of the costs incidental to the organization of the District and (v) paying the costs of issuance of
the Bonds.
The Bonds are special, limited obligations of the City payable solely from the Trust
Estate. Reference is hereby made to the Indenture, copies of which are on file with and available
upon request from the Trustee, for the provisions, among others, with respect to the nature and
extent of the duties and obligations of the City, the Trustee and the Owners. The Owner of this
Bond, by the acceptance hereof, is deemed to have agreed and consented to the terms, conditions
and provisions of the Indenture.
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IN THE INDENTURE, THE CITY HAS RESERVED THE RIGHT to issue Refunding
Bonds payable from and secured by a first lien on, security interest in, and pledge of the sources
described above on a parity with this Bond.
Notwithstanding any provision hereof, the Indenture may be released and the obligation
of the City to make money available to pay this Bond may be defeased by the deposit of money
and/or certain direct or indirect Defeasance Securities sufficient for such purpose as described in
the Indenture.
The Bonds are issuable as fully registered bonds only in denominations of $100,000 and
any multiple of $1,000 in excess thereof ("Authorized Denominations"). Except to the extent
permitted by the Indenture, the City prohibits the breaking up or allocation of CUSIP numbers to
any Bond or Bonds in denominations of less than $100,000, and any attempt to do so will be
void and of no effect.
The Bonds maturing on September 15 in the years 20__, 20__ and 20__ (collectively,
Term Bonds"), are subject to mandatory sinking fund redemption prior to their respective
maturities and will be redeemed by the City in part at the Redemption Price from moneys
available for such purpose in the Principal and Interest Account of the Bond Fund pursuant to
Article VI of the Indenture, on the dates and in the respective sinking fund installments as set
forth in the following schedule:
Term Bonds maturing September 15, 20__
Redemption Date Sinkin Fund Installment Amount
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20 *
Term Bonds maturing September 15, 20__
Redemption Date Sinkin Fund Installment Amount
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
30
September 15, 20 *
Term Bonds maturing September 15, 20__
Redemption Date Sinkin Fund Installment Amount
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20
September 15, 20 *
Stated Maturity.
At least thirty (30) days prior to each mandatory sinking fund redemption date, and
subject to any prior reduction authorized by the Indenture, the Trustee shall select for redemption
by lot, or by any other customary method that results in a random selection, a principal amount
of Bonds of such maturity equal to the Sinking Fund Installments of such Bonds to be redeemed,
shall call such Bonds for redemption on such scheduled mandatory sinking fund redemption
date, and shall give notice of such redemption, as provided in Section 4.6 of the Indenture.
The principal amount of Bonds required to be redeemed on any mandatory sinking fund
redemption date shall be reduced, at the option of the City, by the principal amount of any Bonds
of such maturity which, at least 30 days prior to the sinking fund redemption date shall have been
acquired by the City at a price not exceeding the principal amount of such Bonds plus accrued
and unpaid interest to the date of purchase thereof, and delivered to the Trustee for cancellation.
The Sinking Fund Installments of Term Bonds required to be redeemed on any
mandatory sinking fund redemption shall be reduced in integral multiples of $1,000 by any
portion of such Bonds, which, at least 30 days prior to the mandatory sinking fund redemption
date, shall have been redeemed pursuant to the optional redemption or extraordinary optional
redemption provisions in the Indenture and not previously credited to a mandatory sinking fund
redemption.
The City reserves the right and option to redeem Bonds before their scheduled maturity
date, in whole or in part, on any date on or after September 15, 20__, such redemption date or
dates to be fixed by the City, at the Redemption Price.
The Bonds are subject to extraordinary optional redemption prior to maturity in whole or
in part, on any date, at the Redemption Price from amounts on deposit in the Redemption Fund
as a result of Prepayments or any other transfers to the Redemption Fund under the terms of the
Indenture.
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If less than all of the Bonds are to be redeemed, Bonds may be redeemed in minimum
principal amounts of $1,000 or any integral thereof. Each Bond shall be treated as representing
the number of Bonds that is obtained by dividing the principal amount of such Bond by $1,000.
No redemption shall result in a Bond in a denomination of less than an Authorized
Denomination; provided, however, if the amount of Outstanding Bonds is less than an
Authorized Denomination after giving effect to such partial redemption, a Bond in the principal
amount equal to the unredeemed portion, but not less than $1,000, may be issued.
If less than all of the Bonds are called for optional redemption, the Trustee shall rely on
directions provided in a City Certificate in selecting the Bonds to be redeemed.
If less than all of the Bonds are called for extraordinary optional redemption, the Bonds
or portion of a Bond to be redeemed shall be allocated on a pro rata basis (as nearly as
practicable) among all Outstanding Bonds. If less than all Bonds within a Stated Maturity are
called for extraordinary optional redemption, the Trustee shall call randomly by lot the Bonds, or
portions thereof, within such Stated Maturity and in such principal amounts, for redemption.
Upon written direction from the City to the Trustee of the exercise of any redemption
provision provided under the Indenture, the Trustee shall give notice of any redemption of Bonds
by sending notice by first class United States mail, postage prepaid, not less than 30 days before
the date fixed for redemption, to the Owner of each Bond (or portion thereof) to be redeemed, at
the address shown on the Register. The notice shall state the redemption date, the Redemption
Price, the place at which the Bonds are to be surrendered for payment, and, if less than all the
Bonds Outstanding are to be redeemed, an identification of the Bonds or portions thereof to be
redeemed, any conditions to such redemption and that on the redemption date, if all conditions, if
any, to such redemption have been satisfied, such Bond shall become due and payable. Any
notice so given shall be conclusively presumed to have been duly given, whether or not the
Owner receives such notice.
With respect to any optional redemption of the Bonds, unless the Trustee has received
funds sufficient to pay the Redemption Price of the Bonds to be redeemed before giving of a
notice of redemption, the notice may state the City may condition redemption on the receipt of
such funds by the Trustee on or before the date fixed for the redemption, or on the satisfaction of
any other prerequisites set forth in the notice of redemption. If a conditional notice of
redemption is given and such prerequisites to the redemption and sufficient funds are not
received, the notice shall be of no force and effect, the City shall not redeem the Bonds and the
Trustee shall give notice, in the manner in which the notice of redemption was given, that the
Bonds have not been redeemed.
The City has the right to rescind any optional redemption or extraordinary optional
redemption described in the Indenture by written notice to the Trustee on or prior to the date
fixed for redemption. Any notice of redemption shall be cancelled and annulled if for any reason
funds are not available on the date fixed for redemption for the payment in full of the Bonds then
called for redemption, and such cancellation shall not constitute an Event of Default under the
Indenture. Upon written direction from the City, the Trustee shall mail notice of rescission of
redemption in the same manner notice of redemption was originally provided.
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The Indenture permits, with certain exceptions as therein provided, the amendment
thereof and the modification of the rights and obligations of the City and the rights of the holders
of the Bonds under the Indenture at any time Outstanding affected by such modification. The
Indenture also contains provisions permitting the holders of specified percentages in aggregate
principal amount of the Bonds at the time Outstanding, on behalf of the holders of all the Bonds,
to waive compliance by the City with certain past defaults under the Bond Ordinance or the
Indenture and their consequences. Any such consent or waiver by the holder of this Bond or any
predecessor Bond evidencing the same debt shall be conclusive and binding upon such holder
and upon all future holders thereof and of any Bond issued upon the transfer thereof or in
exchange therefor or in lieu thereof, whether or not notation of such consent or waiver is made
upon this Bond.
As provided in the Indenture, this Bond is transferable upon surrender of this Bond for
transfer at the Designated Payment/Transfer Office, with such endorsement or other evidence of
transfer as is acceptable to the Trustee, and upon delivery to the Trustee of such certifications
and/or opinion of counsel as may be required under the Indenture for the transfer of this Bond.
Upon satisfaction of such requirements, one or more new fully registered Bonds of the same
Stated Maturity, of Authorized Denominations, bearing the same rate of interest, and for the
same aggregate principal amount will be issued to the designated transferee or transferees.
Neither the City nor the Trustee shall be required to issue, transfer or exchange any Bond
called for redemption where such redemption is scheduled to occur within 45 calendar days of
the transfer or exchange date; provided, however, such limitation shall not be applicable to an
exchange by the registered owner of the uncalled principal balance of a Bond.
The City, the Trustee, and any other Person may treat the Person in whose name this
Bond is registered as the owner hereof for the purpose of receiving payment as herein provided
except interest shall be paid to the Person in whose name this Bond is registered on the Record
Date or Special Record Date, as applicable) and for all other purposes, whether or not this Bond
be overdue, and neither the City nor the Trustee shall be affected by notice to the contrary.
NEITHER THE FULL FAITH AND CREDIT NOR THE GENERAL TAXING POWER
OF THE CITY, COLLIN COUNTY, TEXAS, OR THE STATE OF TEXAS, OR ANY
POLITICAL SUBDIVISION THEREOF, IS PLEDGED TO THE PAYMENT OF THE
BONDS.
IT IS HEREBY CERTIFIED AND RECITED that the issuance of this Bond and the
series of which it is a part is duly authorized by law; that all acts, conditions and things required
to be done precedent to and in the issuance of the Bonds have been properly done and performed
and have happened in regular and due time, form and manner, as required by law; and that the
total indebtedness of the City, including the Bonds, does not exceed any Constitutional or
statutory limitation.
IN WITNESS WHEREOF, the City Council of the City has caused this Bond to be
executed under the official seal of the City.
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City Secretary Mayor
CITY SEAL]
b) Form of Comptroller’s Registration Certificate.
The following Registration Certificate of Comptroller of Public Accounts shall appear on
the Initial Bond:
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER §
OF PUBLIC ACCOUNTS § REGISTER NO. ______________
THE STATE OF TEXAS §
I HEREBY CERTIFY THAT there is on file and of record in my office an opinion to the
effect that the Attorney General of the State of Texas has approved this Bond, and that this Bond
has been registered this day by me.
WITNESS MY SIGNATURE AND SEAL OF OFFICE this __________________.
Comptroller of Public Accounts
of the State of Texas
SEAL]
c) Form of Certificate of Trustee.
CERTIFICATE OF TRUSTEE
It is hereby certified that this is one of the Bonds of the series of Bonds referred to in the
within mentioned Indenture.
REGIONS BANK,
as Trustee
DATED: _________________
By: _____________________________
Authorized Signatory
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d) Form of Assignment.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto (print
or typewrite name and address, including zip code, of Transferee.)
Social Security or other identifying number: ____________________________) the within
Bond and all rights hereunder, and hereby irrevocably constitutes and appoints
attorney, to register the transfer of the
within Bond on the books kept for registration thereof, with full power of substitution in the
premises.
Dated: ___________________________
Signature Guaranteed by:
Authorized Signatory
NOTICE: The signature on this Assignment
must correspond with the name of the
registered owner as it appears on the face of
the within Bond in every particular and must
be guaranteed in a manner acceptable to the
Trustee.
e) The Initial Bond shall be in the form set forth in paragraphs (a) through (d) of this
section, except for the following alterations:
i) immediately under the name of the Bond the heading "INTEREST RATE" and
MATURITY DATE" shall both be completed with the expression "As Shown Below," and the
reference to the "CUSIP NUMBER" shall be deleted;
ii) in the first paragraph of the Bond, the words "on the Maturity Date, as specified
above, the sum of ______________________________ DOLLARS" shall be deleted and the
following will be inserted: "on September 15 in each of the years, in the principal installments
and bearing interest at the per annum rates set forth in the following schedule:
Yea Principal Amount Interest Rate"
Information to be inserted from Section 3.2(c)); and
iii) the Initial Bond shall be numbered T-1.
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Section 5.3. CUSIP Registration.
The City may secure identification numbers through CUSIP Global Services, managed by
S&P Global Markets Intelligence on behalf of the American Bankers Association, New York,
New York, and may authorize the printing of such numbers on the face of the Bonds. It is
expressly provided, however, that the presence or absence of CUSIP numbers on the Bonds shall
be of no significance or effect as regards the legality thereof and none of the City, the attorneys
approving said Bonds as to legality or the Trustee are to be held responsible for CUSIP numbers
incorrectly printed on the Bonds. Except as authorized under Section 4.5 hereof, the City
prohibits any Bond to be issued in a denomination of less than $100,000 and further prohibits the
assignment of a CUSIP number to any Bond with a denomination of less than $100,000, and any
attempt to accomplish either of the foregoing shall be void and of no effect. The Trustee may
include in any redemption notice a statement to the effect that the CUSIP numbers on the Bonds
have been assigned by an independent service and are included in such notice solely for the
convenience of the Bondholders and that neither the City nor the Trustee shall be liable for any
inaccuracies in such numbers.
Section 5.4. Legal Opinion.
The approving legal opinion of Bond Counsel may be printed on or attached to each
Bond over the certification of the City Secretary of the City, which may be executed in facsimile.
ARTICLE VI
FUNDS AND ACCOUNTS
Section 6.1. Establishment of Funds and Accounts.
a) Creation of Funds. The following Funds are hereby created and established
under this Indenture:
i) Pledged Revenue Fund;
ii) Bond Fund;
iii) Project Fund;
iv) Reserve Fund;
v) Redemption Fund;
vi) Rebate Fund; and
vii) Administrative Fund.
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b) Creation of Accounts.
i) The following Accounts are hereby created and established under the
Bond Fund:
A) Principal and Interest Account; and
B) Capitalized Interest Account.
ii) The following Accounts are hereby created and established under the
Reserve Fund:
A) Reserve Account; and
B) Delinquency and Prepayment Reserve Account.
iii) The following Accounts are hereby created and established under the
Project Fund:
A) Improvement Area #1 Bond Improvement Account; and
B) Costs of Issuance Account.
iv) The following Account is hereby created and established under the
Pledged Revenue Fund:
A) Bond Pledged Revenue Account.
c) Each Fund and each Account created within such Fund shall be maintained by the
Trustee separate and apart from all other funds and accounts of the City. The Pledged Funds
shall constitute trust funds which shall be held in trust by the Trustee as part of the Trust Estate
solely for the benefit of the Owners of the Bonds. Amounts on deposit in the Funds and
Accounts shall be used solely for the purposes set forth herein.
d) Interest earnings and profit on each respective Fund and Account established by
this Indenture shall be applied or withdrawn for the purposes of such Fund or Account as
specified below.
Section 6.2. Initial Deposits to Funds and Accounts.
a) The proceeds from the sale of the Bonds shall be paid to the Trustee and
deposited or transferred by the Trustee as follows:
i) to the Capitalized Interest Account of the Bond Fund: $__________;
ii) to the Reserve Account of the Reserve Fund: $__________, which is
equal to the initial Reserve Account Requirement;
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iii) to the Costs of Issuance Account of the Project Fund: $__________;
iv) to the Improvement Area #1 Bond Improvement Account of the Project
Fund: $__________; and
v) to the Administrative Fund: $__________.
Section 6.3. Pledged Revenue Fund.
a) Periodically upon receipt thereof, the City shall transfer or cause to be transferred,
pursuant to a City Certificate provided to the Trustee for deposit to the Pledged Revenue Fund
the Improvement Area #1 Assessments and Improvement Area #1 Annual Installments, other
than the portion of the Improvement Area #1 Assessments and Improvement Area #1 Annual
Installments allocated to the payment of Annual Collection Costs and Delinquent Collection
Costs, which shall be deposited to the Administrative Fund in accordance with Section 6.9
hereof. Following such deposit to the Pledged Revenue Fund, the City shall transfer or cause to
be transferred pursuant to a City Certificate provided to the Trustee the following amounts from
the Pledged Revenue Fund to the following Accounts: (i) first, to the Bond Pledged Revenue
Account of the Pledged Revenue Fund, an amount sufficient to pay debt service on the Bonds
next coming due, and (ii) second, if necessary, to the Reserve Account of the Reserve Fund, an
amount to cause the amount in the Reserve Account to equal the Reserve Account Requirement.
Notwithstanding the foregoing, the Additional Interest shall only be utilized for the purposes set
forth in Section 6.7 hereof and, immediately following the initial deposit to the Pledged Revenue
Fund, prior to any other transfers or deposits being made under this Section 6.3(a), if the
Delinquency and Prepayment Reserve Account of the Reserve Fund does not contain the
Delinquency and Prepayment Reserve Requirement and Additional Interest is collected, then all
such Additional Interest will be transferred into the Delinquency and Prepayment Reserve
Account until the Delinquency and Prepayment Reserve Requirement is met. In addition, in the
event the City owes Rebatable Arbitrage to the United States Government pursuant to Section
6.8 hereof, the City shall provide a City Certificate to the Trustee to transfer to the Rebate Fund,
prior to any other transfer under this Section 6.3(a), the full amount of Rebatable Arbitrage owed
by the City, as further described in Section 6.10(f) hereof. If any funds remain on deposit in the
Pledged Revenue Fund after the foregoing deposits and the deposits of Prepayments and
Foreclosure Proceeds, as described below, are made, the City shall have the option, in its sole
and absolute discretion, to use such excess funds for any one or more of the following purposes:
i) pay other costs of the Improvement Area #1 Projects, (ii) pay other costs permitted by the PID
Act, or (iii) deposit such excess into the Redemption Fund to redeem Bonds as provided in
Article IV. Along with each transfer to the Trustee, the City shall provide a certificate as to the
funds, accounts and payments into which the amounts are to be deposited or paid.
b) From time to time as needed to pay the obligations relating to the Bonds, but no
later than five (5) Business Days before each Interest Payment Date, the Trustee shall withdraw
from the Pledged Revenue Fund and transfer to the Principal and Interest Account of the Bond
Fund, an amount, taking into account any amounts then on deposit in such Principal and Interest
Account and any expected transfers from the Capitalized Interest Account to the Principal and
Interest Account, such that the amount on deposit in the Principal and Interest Account equals
the principal (including any Sinking Fund Installments) and interest due on the Bonds on the
next Interest Payment Date.
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c) If, after the foregoing transfers and any transfer from the Reserve Fund as
provided in Section 6.7, there are insufficient funds to make the payments provided in paragraph
b) above, the Trustee shall apply the available funds in the Principal and Interest Account first
to the payment of interest, then to the payment of principal (including any Sinking Fund
Installments) on the Bonds.
d) The Trustee shall transfer Prepayments to the Redemption Fund to be used to
redeem Bonds pursuant to Section 4.4 promptly after deposit of such amounts into the Pledged
Revenue Fund.
e) Promptly after the deposit of Foreclosure Proceeds into the Pledged Revenue
Fund, the Trustee shall transfer such Foreclosure Proceeds first to the Reserve Fund to restore
any transfers from the Accounts within the Reserve Fund made with respect to the particular
Improvement Area #1 Assessed Property to which the Foreclosure Proceeds relate (first, to
replenish the Reserve Account Requirement and second, to replenish the Delinquency and
Prepayment Reserve Requirement), and second, to the Redemption Fund to be used to redeem
Bonds pursuant to Section 4.4.
f) After satisfaction of the requirement to provide for the payment of the principal
and interest on the Bonds and to fund any deficiency that may exist in the Reserve Fund, the
Trustee shall transfer any Pledged Revenues remaining in the Pledged Revenue Fund for the
purposes set forth in Section 6.3(a) hereof, as directed by the City in a City Certificate.
Section 6.4. Bond Fund.
a) On each Interest Payment Date, the Trustee shall withdraw from the Principal and
Interest Account and transfer to the Paying Agent/Registrar the principal (including any Sinking
Fund Installments) and interest then due and payable on the Bonds, less any amount to be used to
pay interest on the Bonds on such Interest Payment Date from the Capitalized Interest Account
as provided below.
b) If amounts in the Principal and Interest Account are insufficient for the purposes
set forth in paragraph (a) above, the Trustee shall withdraw from the Reserve Fund amounts to
cover the amount of such insufficiency pursuant to Section 6.7(f). Amounts so withdrawn from
the Reserve Fund shall be deposited in the Principal and Interest Account and transferred to the
Paying Agent/Registrar.
c) If, after the foregoing transfers and any transfer from the Reserve Fund as
provided in Section 6.7, there are insufficient funds to make the payments provided in paragraph
a) above, the Trustee shall apply the available funds in the Principal and Interest Account first to
the payment of interest, then to the payment of principal (including any Sinking Fund
Installments) on the Bonds.
d) Moneys in the Capitalized Interest Account shall be used for the payment of all
interest due on the Bonds on September 15, 2026. Any amounts on deposit to the Capitalized
Interest Account after the foregoing payment shall be transferred to the Improvement Area #1
Bond Improvement Account of the Project Fund, or if the Improvement Area #1 Bond
Improvement Account of the Project Fund has been closed as provided in Section 6.5(d), such
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amounts shall be transferred to the Redemption Fund to be used to redeem Bonds and the
Capitalized Interest Account shall be closed.
Section 6.5. Project Fund.
a) Money on deposit in the Project Fund shall be used for the purposes specified in
Section 3.1(i) and (v).
b) (1) Disbursements from the Costs of Issuance Account of the Project Fund shall
be made by the Trustee to pay costs of issuance of the Bonds pursuant to one or more City
Certificates. In order to receive the disbursement from the Costs of Issuance Account of the
Project Fund or the Improvement Area #1 Bond Improvement Account of the Project Fund on
the Delivery Date, related to costs of issuance of the Bonds or costs incurred in the creation of
the District, the Developer shall execute a Closing Disbursement Request to be delivered to the
City no less than fifteen (15) business days prior to the Delivery Date. In order to receive the
disbursement for Improvement Area #1 Project Costs from the Improvement Area #1 Bond
Improvement Account of the Project Fund on the Delivery Date, the Developer shall execute a
Certification for Payment to be delivered to the City no later than fifteen (15) business days prior
to the Delivery Date. Upon approval by the City, the City shall submit such Closing
Disbursement Request, together with a City Certificate directing such disbursement, to the
Trustee for disbursement to be made from the Costs of Issuance Account of the Project Fund or
the Improvement Area #1 Bond Improvement Account of the Project Fund, as applicable.
2) Disbursements from the Improvement Area #1 Bond Improvement Account of the
Project Fund to pay Improvement Area #1 Projects shall be made by the Trustee upon receipt by
the Trustee of a properly executed and completed Certification for Payment. The funds from the
Improvement Area #1 Bond Improvement Account of the Project Fund shall be disbursed in
accordance with a Certification for Payment for Improvement Area #1 Projects as described in
the CFA Agreement. Each such Certification for Payment shall include a list of the payees and
the payments to be made to such payees as well as a statement that all payments shall be made
by check or wire transfer in accordance with the payment instructions set forth in such
Certification for Payment or in the invoices submitted therewith and the Trustee may rely on
such payment instructions with no duty to investigate or inquire as to the authenticity of or
authorization for the invoice or the payment instructions contained therein.
c) Except as provided in Section 6.5(d), (f) and (h), money on deposit in the
Improvement Area #1 Bond Improvement Account of the Project Fund shall be used solely to
pay Improvement Area #1 Projects.
d) If the City Representative determines in his or her sole discretion that certain
amounts then on deposit in the Improvement Area #1 Bond Improvement Account are not
expected to be expended for purposes of the Project Fund due to the abandonment, or
constructive abandonment, of one or more of the Improvement Area #1 Projects such that, in the
opinion of the City Representative, it is unlikely that the amounts in the Improvement Area #1
Bond Improvement Account will ever be expended for the purposes of the Project Fund, the City
Representative shall file a City Certificate with the Trustee which identifies the amounts then on
deposit in the Improvement Area #1 Bond Improvement Account that are not expected to be
used for purposes of the Project Fund. If such City Certificate is so filed, the identified amounts
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on deposit in the Improvement Area #1 Bond Improvement Account shall be transferred to the
Bond Fund or to the Redemption Fund to be used to redeem Bonds pursuant to Section 4.4 as
directed by the City Representative in a City Certificate filed with the Trustee. Upon such
transfer, the Improvement Area #1 Bond Improvement Account of the Project Fund shall be
closed.
e) In making any determination pursuant to this Section, the City Representative
may conclusively rely upon a certificate of an Independent Financial Consultant.
f) Upon the filing of a City Certificate stating that all Improvement Area #1 Projects
have been completed and that all Improvement Area #1 Projects have been paid, or that any
Improvement Area #1 Projects are not required to be paid from the Project Fund pursuant to a
Certification for Payment, the Trustee shall transfer the amount, if any, remaining within the
Improvement Area #1 Bond Improvement Account of the Project Fund to the Bond Fund or to
the Redemption Fund to be used to redeem Bonds pursuant to Section 4.4 as directed by the City
Representative in a City Certificate filed with the Trustee. Upon such transfer, the Improvement
Area #1 Bond Improvement Account of the Project Fund shall be closed.
g) Upon a determination by the City Representative that all costs of issuance of the
Bonds have been paid, any amounts remaining in the Costs of Issuance Account shall be
transferred to the Improvement Area #1 Bond Improvement Account of the Project Fund and
used to pay Improvement Area #1 Projects or to the Principal and Interest Account and used to
pay interest on the Bonds, as directed in a City Certificate filed with the Trustee, and the Costs of
Issuance Account shall be closed.
h) In the event the Developer has not completed the Improvement Area #1 Projects
by December 18, 2030, then the City shall provide written direction to the Trustee to transfer all
funds on deposit in the Improvement Area #1 Bond Improvement Account to the Redemption
Fund to redeem Bonds pursuant to Section 4.4 hereof. Upon such transfers, the Improvement
Area #1 Bond Improvement Account of the Project Fund shall be closed.
k) In providing any disbursement under this Section, the Trustee may conclusively
rely as to the completeness and accuracy of all statements in such Certification for Payment if
such certificate is signed by a City Representative, and the Trustee shall not be required to make
any independent investigation in connection therewith. The execution of any Certification for
Payment by a City Representative shall constitute, unto the Trustee, an irrevocable determination
that all conditions precedent to the payments requested have been completed.
Section 6.6. Redemption Fund.
The Trustee, pursuant to a City Certificate, shall cause to be deposited to the Redemption
Fund from the Pledged Revenue Fund an amount sufficient to redeem Bonds as provided in
Sections 4.3 and 4.4 on the dates specified for redemption as provided in Sections 4.3 and 4.4.
Amounts on deposit in the Redemption Fund shall be used and withdrawn by the Trustee to
redeem Bonds as provided in Article IV.
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Section 6.7. Reserve Fund.
a) The City agrees with the Owners of the Bonds to accumulate and, when
accumulated, maintain in the Reserve Account, an amount equal to not less than the Reserve
Account Requirement. All amounts deposited in the Reserve Account shall be used and
withdrawn by the Trustee for the purpose of making transfers to the Principal and Interest
Account of the Bond Fund as provided in this Indenture. The Trustee will transfer from the
Pledged Revenue Fund to the Delinquency and Prepayment Reserve Account on March 15 of
each year, commencing March 15, 2027, an amount the City confirms to the Trustee is equal to
the Additional Interest until the Delinquency and Prepayment Reserve Requirement has been
accumulated in the Delinquency and Prepayment Reserve Account; provided, however, that at
any time the amount on deposit in the Delinquency and Prepayment Reserve Account is less than
Delinquency and Prepayment Reserve Requirement, the Trustee shall resume depositing the
Additional Interest into the Delinquency and Prepayment Reserve Account until the Delinquency
and Prepayment Reserve Requirement has accumulated in the Delinquency and Prepayment
Reserve Account. In transferring the amounts pursuant to this Section, the Trustee may
conclusively rely on a City Certificate (which shall be based on the Improvement Area #1
Annual Installments as shown on the Improvement Area #1 Assessment Roll in the Service and
Assessment Plan) unless and until it receives a City Certificate directing that a different amount
be used. Whenever a transfer is made from the Reserve Account to the Bond Fund due to a
deficiency in the Bond Fund, the Trustee shall provide written notice thereof to the City,
specifying the amount withdrawn and the source of said funds. The Additional Interest shall
continue to be collected and deposited pursuant to this Section 6.7 until the Bonds are no longer
Outstanding.
b) Whenever a transfer is made from the Reserve Fund to the Bond Fund due to a
deficiency in the Bond Fund, the Trustee shall provide written notice thereof to the City,
specifying the amount withdrawn and the source of said funds.
c) In the event of an extraordinary optional redemption of Bonds from the proceeds
of a Prepayment pursuant to Section 4.4, the Trustee, pursuant to a City Certificate, shall transfer
from the Reserve Account of the Reserve Fund to the Redemption Fund the amount specified in
such directions, which shall be an amount equal to the principal amount of Bonds to be redeemed
multiplied by the lesser of: (i) the amount required to be in the Reserve Account of the Reserve
Fund divided by the principal amount of Outstanding Bonds prior to the redemption, and (ii) the
amount actually in the Reserve Account of the Reserve Fund divided by the principal amount of
Outstanding Bonds prior to the redemption. If after such transfer, and after applying investment
earnings on the Prepayment toward payment of accrued interest, there are insufficient funds to
pay the principal amount plus accrued and unpaid interest on such Bonds to the date fixed for
redemption of the Bonds to be redeemed as a result of such Prepayment, the Trustee shall
transfer an amount equal to the shortfall, or any additional amounts necessary to permit the
Bonds to be redeemed in minimum principal amounts of $1,000, from the Delinquency and
Prepayment Reserve Account to the Redemption Fund to be applied to the redemption of the
Bonds.
d) Whenever, on any Interest Payment Date, or on any other date at the written
request of a City Representative, the value of cash and Value of Investment Securities on deposit
in the Reserve Account exceeds the Reserve Account Requirement, the Trustee shall provide
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written notice to the City Representative of the amount of the excess. Such excess shall be
transferred to the Principal and Interest Account to be used for the payment of interest on the
Bonds on the next Interest Payment Date in accordance with Section 6.4, unless within thirty
days of such notice to the City Representative, the Trustee receives a City Certificate instructing
the Trustee to apply such excess: (i) to pay amounts due under Section 6.8 hereof, (ii) to the
Administrative Fund in an amount not more than the Annual Collection Costs for the Bonds, (iii)
to the Improvement Area #1 Bond Improvement Account of the Project Fund to pay
Improvement Area #1 Project Costs if such application and the expenditure of funds is expected
to occur within three years of the date hereof, or (iv) to the Redemption Fund to be applied to the
redemption of Bonds.
e) Whenever, on any Interest Payment Date, or on any other date at the written
request of a City Representative, the amounts on deposit in the Delinquency and Prepayment
Reserve Account exceed the Delinquency and Prepayment Reserve Requirement, the Trustee
shall provide written notice to the City of the amount of the excess, and such excess shall be
transferred, at the direction of the City pursuant to a City Certificate, to the Administrative Fund
for the payment of Annual Collection Costs or to the Redemption Fund to be used to redeem
Bonds pursuant to Section 4.4. In the event that the Trustee does not receive a City Certificate
directing the transfer of such excess to the Administrative Fund within 45 days of providing
notice to the City of such excess, the Trustee shall transfer such excess to the Redemption Fund
to redeem Bonds pursuant to Section 4.4 hereof and provide the City with written notification of
the transfer. The Trustee shall incur no liability for the accuracy or validity of the transfer so
long as the Trustee made such transfer in full compliance with this Section.
f) Whenever, on any Interest Payment Date, the amount on deposit in the Bond
Fund is insufficient to pay the debt service on the Bonds due on such date, the Trustee shall
transfer first from the Delinquency and Prepayment Reserve Account of the Reserve Fund and
second from the Reserve Account of the Reserve Fund to the Bond Fund the amounts necessary
to cure such deficiency.
g) At the final maturity of the Bonds, the amount on deposit in the Reserve Account
and the Delinquency and Prepayment Reserve Account shall be transferred to the Principal and
Interest Account and applied to the payment of the principal of the Bonds.
h) If, after a Reserve Account withdrawal, the amount on deposit in the Reserve
Account is less than the Reserve Account Requirement, the Trustee shall transfer from the
Pledged Revenue Fund to the Reserve Account the amount of such deficiency, but only to the
extent that such amount is not required for the timely payment of principal, interest, or Sinking
Fund Installments.
i) If the amount held in the Reserve Fund together with the amount held in the
Pledged Revenue Fund, the Bond Fund and Redemption Fund is sufficient to pay the principal
amount and of all Outstanding Bonds on the next date the Bonds may be optionally redeemed by
the City at a redemption price of par, together with the unpaid interest accrued on such Bonds as
of such date, the moneys shall be transferred to the Redemption Fund and thereafter used to
redeem all Bonds on such date.
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Section 6.8. Rebate Fund: Rebatable Arbitrage.
a) The Rebate Fund is to be held by the Trustee in accordance with the terms and
provisions of this Indenture. Amounts on deposit in the Rebate Fund shall be used solely for the
purpose of paying amounts due the United States Government in accordance with the Code. The
Rebate Fund shall not be part of the Trust Estate and shall not be security for the Bonds.
b) In order to assure that Rebatable Arbitrage is paid to the United States rather than
to a third party, investments of funds on deposit in the Rebate Fund shall be made in accordance
with the Code and the City’s federal tax certificate for the Bonds, as further set forth in written
directions from the City to the Trustee. The Trustee may conclusively rely on such written
instructions as set forth in this Section and shall not be responsible for any loss or liability
resulting from the investment of funds under this Section, but only so long as the Trustee follows
such written instructions in all respects.
c) The Trustee conclusively shall be deemed to have complied with the provisions of
this Section and shall not be liable or responsible if it follows the written instructions of the City
and shall not be required to take any action under this Section in the absence of instructions from
the City.
d) If, on the date of each annual calculation, the amount on deposit in the Rebate
Fund exceeds the amount of the Rebatable Arbitrage, the City may direct the Trustee, pursuant to
a City Certificate, to transfer the amount in excess of the Rebatable Arbitrage to the Bond Fund.
Section 6.9. Administrative Fund.
a) Periodically upon receipt thereof, the City shall deposit or cause to be deposited to
the Administrative Fund the portion of the Improvement Area #1 Assessments and Improvement
Area #1 Annual Installments allocated to the payment of Annual Collection Costs and
Delinquent Collection Costs, as set forth in the Service and Assessment Plan.
b) Moneys in the Administrative Fund shall be held by the Trustee separate and
apart from the other Funds created and administered hereunder and used as directed by a City
Certificate solely for the purposes set forth in the Service and Assessment Plan, including
payment of Annual Collection Costs and Delinquent Collection Costs. The Administrative Fund
shall not be part of the Trust Estate and shall not be security for the Bonds.
Section 6.10. Investment of Funds.
a) Money in any Fund or Account, other than the Reserve Fund, shall be invested by
the Trustee in Investment Securities as directed by the City pursuant to a City Certificate filed
with the Trustee; provided that all such deposits and investments shall be made in such manner
that the money required to be expended from any Fund or Account will be available at the proper
time or times. Money in the Reserve Fund shall be invested in such Investment Securities as
directed by the City pursuant to a City Certificate filed with the Trustee, provided that the final
maturity of any individual Investment Security shall not exceed 270 days and the average
weighted maturity of any investment pool or no-load money market mutual fund shall not exceed
90 days. Each such City Certificate shall be a certification, upon which the Trustee may
conclusively rely without investigation or inquiry, that the investment directed therein constitutes
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an Investment Security and that such investments meet the maturity and average weighted
maturity requirements set forth in the preceding sentence. Such investments shall be valued each
year in terms of the Value of Investment Securities as of September 30. For purposes of
maximizing investment returns, to the extent permitted by law, money in the Funds and
Accounts may be invested in common investments of the kind described above, or in a common
pool of such investment which shall be kept and held at an official depository bank, which shall
not be deemed to be or constitute a commingling of such money or funds provided that
safekeeping receipts or certificates of participation clearly evidencing the investment or
investment pool in which such money is invested and the share thereof purchased with such
money or owned by such Fund or Account are held by or on behalf of each such Fund or
Account. If necessary, such investments shall be promptly sold to prevent any default under this
Indenture. To ensure that cash on hand is invested, if the City does not give the Trustee written
or timely instructions with respect to investments of funds, the Trustee is hereby directed to
invest and re-invest cash balances in Morgan Stanley, Fidelity or Federated family of funds, but
only so long as such funds are authorized investments and permitted under the Public Funds
Investment Act, Texas Government Code, Chapter 2256, as amended, or any successor law, and
only so long as such investments constitute Investment Securities and the money required to be
expended from any Fund will be available at the proper time or times.
b) Obligations purchased as an investment of moneys in any Fund or Account shall
be deemed to be part of such Fund or Account, subject, however, to the requirements of this
Indenture for transfer of interest earnings and profits resulting from investment of amounts in
Funds and Accounts. Whenever in this Indenture any moneys are required to be transferred by
the City to the Trustee, such transfer may be accomplished by transferring a like amount of
Investment Securities as directed by the City in writing.
c) The Trustee and its affiliates may act as sponsor, advisor, depository, principal or
agent in the acquisition or disposition of any investment. The Trustee shall not incur any liability
for losses arising from any investments made pursuant to this Section. The Trustee shall not be
required to determine the suitability or legality of any investments or whether investments
comply with Section 6.10(a) above. The parties acknowledge that the Trustee is not providing
investment supervision, recommendations, or advice.
d) Investments in any and all Funds and Accounts may be commingled in a separate
fund or funds for purposes of making, holding and disposing of investments, notwithstanding
provisions herein for transfer to or holding in or to the credit of particular Funds or Accounts of
amounts received or held by the Trustee hereunder, provided that the Trustee shall at all times
account for such investments strictly in accordance with the Funds and Accounts to which they
are credited and otherwise as provided in this Indenture.
e) The Trustee will furnish to the City, upon the City’s written request, periodic cash
transaction statements which include detail for all investment transactions effected by the Trustee
or brokers selected by the City. Upon the City’s election, such statements will be delivered via
the Trustee’s online service and upon electing such service, paper statements will be provided
only upon request. The City waives the right to receive brokerage confirmations of security
transactions effected by the Trustee as they occur, to the extent permitted by law. The City
further understands that trade confirmations for securities transactions effected by the Trustee
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will be available upon request and at no additional cost and other trade confirmations may be
obtained from the applicable broker.
f) In the event it is found, after an annual calculation has been done pursuant to
Section 6.8 hereof, that the City owes Rebatable Arbitrage to the United States Government, the
City shall direct the Trustee, pursuant to a City Certificate, to transfer to the Rebate Fund the
investment earnings on funds on deposit in the Pledged Funds in an amount equal to the
Rebatable Arbitrage owed by the City. The City Certificate shall specify the amount to the
transferred and the Pledged Fund or Pledged Funds from which the investment earnings shall be
transferred.
Section 6.11. Security of Funds.
All Funds heretofore created or reaffirmed, to the extent not invested as herein permitted,
shall be secured in the manner and to the fullest extent required by law for the security of public
funds, and such Funds shall be used only for the purposes and in the manner permitted or
required by this Indenture.
ARTICLE VII
COVENANTS
Section 7.1. Confirmation of Improvement Area #1 Assessments.
The City hereby confirms, covenants, and agrees that, in the Assessment Ordinance, it
has levied the Improvement Area #1 Assessments against the Improvement Area #1 Assessed
Property from which the Assessment Revenues will be collected and received.
Section 7.2. Collection and Enforcement of Improvement Area #1 Assessments.
a) For so long as any Bonds are Outstanding, the City covenants, agrees and
warrants that it will take and pursue all reasonable actions permissib1e under Applicable Laws to
cause the Improvement Area #1 Assessments to be collected and the liens thereof enforced
continuously, in the manner and to the maximum extent permitted by Applicable Laws, and to
cause no reduction, abatement or exemption in the Improvement Area #1 Assessments.
b) To the extent permitted by law, notice of the Improvement Area #1 Annual
Installments shall be sent by, or on behalf of, the City to the affected property owners on the
same statement or such other mechanism that is used by the City, so that such Improvement Area
1 Annual Installments are collected simultaneously with ad valorem taxes and shall be subject
to the same penalties, procedures, and foreclosure sale in case of delinquencies as are provided
for ad valorem taxes of the City.
c) The City will determine or cause to be determined, no later than February 15 of
each year, whether or not any Improvement Area #1 Annual Installment is delinquent and, if
such delinquencies exist, the City will order and cause to be commenced as soon as practicable
any and all appropriate and legally permissible actions to obtain such Improvement Area #1
Annual Installment, and any delinquent charges and interest thereon, including diligently
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prosecuting an action in district court to foreclose the currently delinquent Improvement Area #1
Annual Installment. Notwithstanding the foregoing, the City shall not be required under any
circumstances to purchase or make payment for the purchase of the delinquent Improvement
Area #1 Assessments or the corresponding particular Improvement Area #1 Assessed Property.
d) The City shall not be required under any circumstances to expend any funds for
Delinquent Collection Costs or Annual Collection Costs in connection with its covenants and
agreements under this Section or otherwise other than funds on deposit in the Administrative
Fund.
Section 7.3. Against Encumbrances.
a) Other than Refunding Bonds, the City shall not create and, to the extent Pledged
Revenues are received, shall not suffer to remain, any lien, encumbrance or charge upon the
Trust Estate or upon any other property pledged under this Indenture, except the pledge created
for the security of the Bonds, and other than a lien or pledge subordinate to the lien and pledge of
such property related to the Bonds.
b) So long as Bonds are Outstanding hereunder, the City shall not issue any bonds,
notes or other evidences of indebtedness, other than the Bonds and any Refunding Bonds,
secured by any pledge of or other lien or charge on the Trust Estate or other property pledged
under this Indenture, other than a lien or pledge subordinate to the lien and pledge of such
property related to the Bonds.
Section 7.4. Records, Accounts, Accounting Reports.
The City hereby covenants and agrees that so long as any Bonds are Outstanding, it will
keep and maintain a proper and complete system of records and accounts pertaining to the
Improvement Area #1 Assessments. The Trustee and holder or holders of any Bonds or any duly
authorized agent or agents of such holders shall have the right at all reasonable times to inspect
all such records, accounts, and data relating thereto, upon written request to the City by the
Trustee or duly authorized representative, as applicable. The City shall provide the Trustee or
duly authorized representative, as applicable, an opportunity to inspect such books and records
relating to the Bonds during the City’s regular business hours and on a mutually agreeable date
not later than twenty days after the City receives such request.
Section 7.5. Covenants Regarding Tax Exemption of Interest on Bonds.
a) The City covenants to take any action necessary to assure, or refrain from any
action that would adversely affect, the treatment of the Bonds as an obligation described in
section 103 of the Code, the interest on which is not includable in the "gross income" of the
holder for purposes of federal income taxation. In furtherance thereof, the City covenants as
follows:
1) to take any action to assure that no more than 10 percent of the proceeds
of the Bonds (less amounts deposited to a reserve fund, if any) are used for any "private
business use," as defined in section 141(b)(6) of the Code or, if more than 10 percent of
the proceeds or the projects financed therewith are so used, such amounts, whether or not
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received by the City, with respect to such private business use, do not, under the terms of
this Article or any underlying arrangement, directly or indirectly, secure or provide for
the payment of more than 10 percent of the debt service on the Bonds, in contravention of
section 141(b)(2) of the Code;
2) to take any action to assure that in the event that the "private business use"
described in subsection (1) hereof exceeds 5 percent of the proceeds of the Bonds or the
projects financed therewith (less amounts deposited into a reserve fund, if any) then the
amount in excess of 5 percent is used for a "private business use" that is "related" and not
disproportionate," within the meaning of section 141(b)(3) of the Code, to the
governmental use;
3) to take any action to assure that no amount that is greater than the lesser of
5,000,000, or 5 percent of the proceeds of the Bonds (less amounts deposited into a
reserve fund, if any) is directly or indirectly used to finance loans to persons, other than
state or local governmental units, in contravention of section 141(c) of the Code;
4) to refrain from taking any action that would otherwise result in the Bonds
being treated as a "private activity bond" within the meaning of section 141(b) of the
Code;
5) to refrain from taking any action that would result in the Bonds being
federally guaranteed" within the meaning of section 149(b) of the Code;
6) to refrain from using any portion of the proceeds of the Bonds, directly or
indirectly, to acquire or to replace funds that were used, directly or indirectly, to acquire
investment property (as defined in section 148(b)(2) of the Code) that produces a
materially higher yield over the term of the Bonds, other than investment property
acquired with –
A) proceeds of the Bonds invested for a reasonable temporary period
of 3 years or less or, in the case of refunding bonds, for a period of 30 days or less
until such proceeds are needed for the purpose for which the Bonds or refunding
bonds are issued,
B) amounts invested in a bona fide debt service fund, within the
meaning of section 1.148-1(b) of the Treasury Regulations, and
C) amounts deposited in any reasonably required reserve or
replacement fund to the extent such amounts do not exceed 10 percent of the
proceeds of the Bonds;
7) to otherwise restrict the use of the proceeds of the Bonds or amounts
treated as proceeds of the Bonds, as may be necessary, so that the Bonds do not otherwise
contravene the requirements of section 148 of the Code (relating to arbitrage);
8) to refrain from using the proceeds of the Bonds or proceeds of any prior
bonds to pay debt service on another issue more than 90 days after the date of issue of the
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Bonds in contravention of the requirements of section 149(d) of the Code (relating to
advance refundings);
9) to pay to the United States of America at least once during each five-year
period (beginning on the Delivery Date) an amount that is at least equal to 90 percent of
the "Excess Earnings," within the meaning of section 148(f) of the Code and to pay to the
United States of America, not later than 60 days after the Bonds have been paid in full,
100 percent of the amount then required to be paid as a result of Excess Earnings under
section 148(f) of the Code;
10) to file or cause to be filed with the Secretary of the Treasury, not later than
the fifteenth (15th) day of the second calendar month after the close of the calendar
quarter in which the Bonds are issued, an information statement concerning the Bonds,
all under and in accordance with section 149(e) of the Code and the applicable Treasury
Regulations promulgated thereunder;
11) to assure that the proceeds of the Bonds will be used solely for new money
projects; and
12) to establish reasonable expectations to prevent using the proceeds of the
Bonds in contravention of the requirements of section 149(g) of the Code (relating to
hedge bonds).
b) In order to facilitate compliance with the above covenant (a)(9), the Rebate Fund
is established by the City pursuant to Section 6.1 for the sole benefit of the United States of
America, and such Rebate Fund shall not be subject to the claim of any other person, including
without limitation the registered Owner. The Rebate Fund is established for the additional
purpose of compliance with section 148 of the Code.
c) The City understands that the term "proceeds" includes "disposition proceeds" as
defined in the Treasury Regulations and, in the case of refunding bonds, transferred proceeds (if
any) and proceeds of the refunded bonds expended prior to the date of issuance of the Bonds. It
is the understanding of the City that the covenants contained herein are intended to assure
compliance with the Code and any regulations or rulings promulgated by the U.S. Department of
the Treasury pursuant thereto (the "Treasury Regulations"). In the event that regulations or
rulings are hereafter promulgated that modify or expand provisions of the Code, as applicable to
the Bonds, the City will not be required to comply with any covenant contained herein to the
extent that such failure to comply, in the opinion of nationally recognized bond counsel, will not
adversely affect the exemption from federal income taxation of interest on the Bonds under
section 103 of the Code. In the event that regulations or rulings are hereafter promulgated that
impose additional requirements applicable to the Bonds, the City agrees to comply with the
additional requirements to the extent necessary, in the opinion of nationally recognized bond
counsel, to preserve the exemption from federal income taxation of interest on the Bonds under
section 103 of the Code. In furtherance of such intention, the City hereby authorizes and directs
the City Manager and Finance Director to execute any documents, certificates or reports required
by the Code and to make such elections, on behalf of the City, that may be permitted by the Code
as are consistent with the purpose for the issuance of the Bonds.
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d) The City covenants to account for the expenditure of sale proceeds and
investment earnings to be used for Improvement Area #1 Projects on its books and records in
accordance with the requirements of the Code. The City recognizes that in order for the
proceeds to be considered used for the reimbursement of costs, the proceeds must be allocated to
expenditures within 18 months of the later of the date that (1) the expenditure is made, or (2) the
Improvement Area #1 Projects are completed; but in no event later than three years after the date
on which the original expenditure is paid. The foregoing notwithstanding, the City recognizes
that in order for proceeds to be expended under the Code, the sale proceeds or investment
earnings must be expended no more than 60 days after the earlier of (1) the fifth anniversary of
the Delivery Date, or (2) the date the Bonds are retired. The City agrees to obtain the advice of
nationally-recognized bond counsel if such expenditure fails to comply with the foregoing to
assure that such expenditure will not adversely affect the tax-exempt status of the Bonds. For
purposes hereof, the City shall not be obligated to comply with this covenant if it obtains an
opinion that such failure to comply will not adversely affect the excludability for federal income
tax purposes from gross income of the interest.
e) The City covenants that the projects funded with the proceeds of the Bonds will
not be sold or otherwise disposed in a transaction resulting in the receipt by the City of cash or
other compensation, unless the City obtains an opinion of nationally-recognized bond counsel
that such sale or other disposition will not adversely affect the tax-exempt status of the Bonds.
For purposes of the foregoing, the portion of the property comprising personal property and
disposed in the ordinary course shall not be treated as a transaction resulting in the receipt of
cash or other compensation. For purposes hereof, the City shall not be obligated to comply with
this covenant if it obtains a legal opinion that such failure to comply will not adversely affect the
excludability for federal income tax proposes from gross income of the interest.
ARTICLE VIII
LIABILITY OF CITY
Section 8.1. Liability of City.
a) Neither the full faith and credit nor the general taxing power of the City is
pledged to the payment of the Bonds, and, except for the Trust Estate, no City taxes, fee or
revenues from any source are pledged to the payment of, or available to pay any portion of, the
Bonds or any other obligations relating to the District. The City shall never be liable for any
obligations relating to the Bonds or other obligations relating to the District, other than as
specifically provided for in this Indenture.
b) The City shall not incur any responsibility in respect of the Bonds or this
Indenture other than in connection with the duties or obligations explicitly herein or in the Bonds
assigned to or imposed upon it. The City shall not be liable in connection with the performance
of its duties hereunder, except for its own willful default or act of bad faith. The City shall not be
bound to ascertain or inquire as to the performance or observance of any of the terms, conditions
covenants or agreements of the Trustee herein or of any of the documents executed by the
Trustee in connection with the Bonds, or as to the existence of a default or event of default
thereunder.
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c) In the absence of bad faith, the City may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon certificates or opinions
furnished to the City and conforming to the requirements of this Indenture. The City shall not be
liable for any error of judgment made in good faith unless it shall be proved that it was negligent
in ascertaining the pertinent facts.
d) No provision of this Indenture, the Bonds, the Assessment Ordinance, or any
agreement, document, instrument, or certificate executed, delivered or approved in connection
with the issuance, sale, delivery, or administration of the Bonds (collectively, the "Bond
Documents"), shall require the City to expend or risk its own general funds or other funds or
otherwise incur any financial liability (other than with respect to the Trust Estate and the Annual
Collection Costs) in the performance of any of its obligations hereunder, or in the exercise of any
of its rights or powers, if in the judgment of the City there are reasonable grounds for believing
that the repayment of such funds or liability is not reasonably assured to it.
e) Neither the Owners nor any other Person shall have any claim against the City or
any of its officers, officials, agents, or employees for damages suffered as a result of the City’s
failure to perform in any respect any covenant, undertaking, or obligation under any Bond
Documents or as a result of the incorrectness of any representation in, or omission from, any of
the Bond Documents, except to the extent that any such claim relates to an obligation,
undertaking, representation, or covenant of the City, in accordance with the Bond Documents
and the PID Act. Any such claim shall be payable only from the Trust Estate or the amounts
collected to pay Annual Collection Costs on deposit in the Administrative Fund. Nothing
contained in any of the Bond Documents shall be construed to preclude any action or proceeding
in any court or before any governmental body, agency, or instrumentality against the City or any
of its officers, officials, agents, or employees to enforce the provisions of any of the Bond
Documents or to enforce all rights of the Owners of the Bonds by mandamus or other proceeding
at law or in equity.
f) The City may rely on and shall be protected in acting or refraining from acting
upon any notice, resolution, request, consent, order, certificate, report, warrant, bond, or other
paper or document believed by it to be genuine and to have been signed or presented by the
proper party or proper parties. The City may consult with counsel with regard to legal questions,
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 therewith.
Whenever in the administration of its duties under this Indenture the City 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 willful misconduct on the part of the City, be deemed to be
conclusively proved and established by a certificate of the Trustee, an Independent Financial
Consultant, an independent inspector or City Manager or other person designated by the City
Council to so act on behalf of the City, and such certificate shall be full warrant to the City for
any action taken or suffered under the provisions of this Indenture upon the faith thereof, but in
its discretion the City may, in lieu thereof, accept other evidence of such matter or may require
such additional evidence as to it may deem reasonable.
g) In order to perform its duties and obligations hereunder, the City may employ
such persons or entities as it deems necessary or advisable. The City shall not be liable for any of
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the acts or omissions of such persons or entities employed by it in good faith hereunder, and shall
be entitled to rely, and shall be fully protected in doing so, upon the opinions, calculations,
determinations, and directions of such persons or entities.
ARTICLE IX
THE TRUSTEE
Section 9.1. Acceptance of Trust; Trustee as Registrar and Paying Agent.
a) The Trustee accepts and agrees to execute the respective trusts imposed upon it by
this Indenture, but only upon the express terms and conditions and subject to the provisions of
this Indenture to all of which the parties hereto and the respective Owners of the Bonds agree.
No implied covenants or obligations shall be read into this Indenture against the Trustee.
b) The Trustee is hereby designated and agrees to act as Paying Agent/Registrar for
and with respect to the Bonds.
Section 9.2. Trustee Entitled to Indemnity.
The Trustee shall be under no obligation to institute any suit, or to undertake any
proceeding under this Indenture, or to enter any appearance or in any way defend in any suit in
which it may be made defendant, or to take any steps in the execution of the trusts hereby created
or in the enforcement of any rights and powers hereunder, until it shall be indemnified, to the
extent permitted by law, to its satisfaction against any and all costs and expenses, outlays, and
counsel fees and other reasonable disbursements, and against all liability except as a
consequence of its own negligence or willful misconduct; provided, however, that in no event
shall the Trustee request or require indemnification as a condition to making any deposits,
payments or transfers (provided such payment or transfer is prior to an Event of Default) when
required hereunder, or to deliver any notice when required hereunder. To the extent permitted by
law and during the occurrence of an Event of Default, the Trustee shall be entitled to
indemnification as a condition to making any deposits, payments or transfers when required
hereunder, or to delivering any notice when required hereunder. Nevertheless, the Trustee may
begin suit, or appear in and defend suit, or exercise any such rights and powers as Trustee, and in
such case the Trustee may make transfers from the Administrative Fund, and to the extent money
in the Administrative Fund is insufficient, from the Pledged Revenue Fund, to pay all fees, costs
and expenses, outlays, and counsel fees and other reasonable disbursements properly incurred in
connection therewith and shall, to the extent permitted by law, be entitled to a preference
therefor over any Bonds Outstanding hereunder.
Section 9.3. Responsibilities of the Trustee.
a) The recitals contained in this Indenture and in the Bonds shall be taken as the
statements of the City and the Trustee assumes no responsibility for and undertakes no duty to
verify the correctness of the same. The Trustee makes no representations as to the validity or
sufficiency of this Indenture or the Bonds or with respect to the security afforded by this
Indenture, and the Trustee shall incur no liability with respect thereto. Except as otherwise
expressly provided in this Indenture, the Trustee shall have no responsibility or duty with respect
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to: (i) the issuance of Bonds for value; (ii) the application of the proceeds thereof, except to the
extent that such proceeds are received by it in its capacity as Trustee; (iii) the application of any
moneys paid to the City or others in accordance with this Indenture, except as to the application
of any moneys paid to it in its capacity as Trustee; (iv) any calculation of arbitrage or rebate
under the Code; (v) any loss suffered in connection with any investment of funds in accordance
with this Indenture; or (vi) to undertake any other action unless specifically authorized pursuant
to a written direction by the City or pursuant to this Indenture.
b) The duties and obligations of the Trustee shall be determined 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. The Trustee will, prior
to any Event of Default and after curing of any Event of Default, perform such duties and only
such duties as are specifically set forth herein. The Trustee will, during the existence of an Event
of Default, exercise such rights and powers vested in it by this Indenture and use the same degree
of care and skill in its exercise as a prudent person would exercise or use under the
circumstances in the conduct of his/her own affairs.
c) The Trustee shall not be liable for any action taken or omitted by it in the
performance of its duties under this Indenture, except for its own negligence or willful
misconduct. In no event shall the Trustee be liable for incidental, indirect, special or
consequential damages in connection with or arising from this Indenture for the existence,
furnishing or use of the Improvement Area #1 Projects. 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 Owners of not less than a majority in principal amount of the Bonds then
Outstanding relating to the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this
Indenture.
d) The Trustee shall not be liable for any error of judgment made in good faith by
any one of its officers, unless it shall be established that the Trustee was negligent in ascertaining
the pertinent facts.
e) The Trustee’s immunities and protections from liability and its right to
indemnification in connection with the performance of its duties under this Indenture shall
extend to the Trustee’s officers, directors, agents, attorneys and employees. Such immunities
and protections and rights to indemnification, together with the Trustee’s right to compensation,
shall survive the Trustee’s resignation or removal, the discharge of this Indenture.
f) The Trustee may execute any of the trusts or powers hereunder or perform any
duties hereunder either directly or through agents, attorneys, or receivers, and shall not be
responsible for any misconduct or negligence on the part of any agent, attorney, or receiver
appointed or chosen by it with due care, and the Trustee shall be entitled to rely and act upon the
opinion or advice of counsel, who may be counsel to the City, concerning all matters of trust
hereof and the duties hereunder, and may in all cases pay such reasonable compensation to all
such agents, attorneys, and receivers as may reasonably be employed in connection with the
trusts hereof. The Trustee shall not be responsible for any loss or damage resulting from any
action or nonaction by it taken or omitted to be taken in good faith in reliance upon such opinion
or advice of counsel.
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g) The Trustee shall not be responsible for any recital herein (except with respect to
the authentication certificate of the Trustee endorsed on the Bonds) or for the recording, filing, or
refiling of this Indenture in connection therewith, or for the validity of the execution by the City
of this Indenture or of any Supplemental Indentures or instruments of further assurance, or for
the sufficiency or security of the Bonds. The Trustee shall not be responsible or liable for any
loss suffered in connection with any investment of funds made by it in accordance with this
Indenture.
h) The Trustee makes no representations as to the value or condition of the Trust
Estate or any part thereof, or as to the validity or sufficiency of this Indenture or of the Bonds.
The Trustee shall not be accountable for the use or application of any Bonds or the proceeds
thereof or of any money paid to or upon the order of the City under any provision of this
Indenture.
Section 9.4. Property Held in Trust.
All moneys and securities held by the Trustee at any time pursuant to the terms of this
Indenture shall be held by the Trustee in trust for the purposes and under the terms and
conditions of this Indenture.
Section 9.5. Trustee Protected in Relying on Certain Documents.
a) The Trustee may conclusively rely upon any order, notice, request, consent,
waiver, certificate, statement, affidavit, requisition, bond, or other document provided to the
Trustee in accordance with the terms of this Indenture that it shall in good faith reasonably
believe to be genuine and to have been adopted or signed by the proper board or Person or to
have been prepared and furnished pursuant to any of the provisions of this Indenture, or upon the
written opinion of any counsel, architect, engineer, insurance consultant, management
consultant, or accountant that the Trustee shall in good faith reasonably believe to be qualified in
relation to the subject matter or is selected by the City in accordance with this Indenture, and the
Trustee shall be under no duty to make any investigation or inquiry into, and shall not be deemed
to have knowledge of, any statements contained or matters referred to in any such instrument.
The Trustee may consult with counsel selected by the Trustee with due care that is nationally
recognized in the field of municipal bond law, who may or may not be Bond Counsel, and any
advice from such counsel with respect to compliance with the provisions of this Indenture shall
be full and complete authorization and protection in respect of any action taken, suffered or
omitted to be taken by it hereunder, reasonably and in good faith, in accordance with such
advice.
b) Whenever the Trustee shall deem it necessary or desirable that a matter be proved
or established prior to taking or suffering any action under this Indenture, such matter may be
deemed to be conclusively proved and established by a City Certificate, unless other evidence in
respect thereof be hereby specifically prescribed. Such City Certificate shall be full warrant for
any action taken or suffered in good faith under the provisions hereof, but the Trustee may in lieu
thereof accept other evidence of such fact or matter or may require such further or additional
evidence as it may deem reasonable. Except as otherwise expressly provided herein, any request,
order, notice, or other direction required or permitted to be furnished pursuant to any provision
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hereof by the City to the Trustee shall be sufficiently executed if executed in the name of the
City by the City Representative. The Trustee shall be entitled to conclusively rely upon the
foregoing as sufficient evidence of the facts set forth herein. The execution of any City
Certificate shall constitute, unto the Trustee, an irrevocable determination that all conditions
precedent thereto have occurred.
c) The Trustee shall not be under any obligation to see to the recording or filing of
this Indenture, or otherwise to the giving to any Person of notice of the provisions hereof except
as expressly required in Section 9.13.
Section 9.6. Compensation.
Unless otherwise provided by contract with the Trustee, the Trustee, at the written
direction of the City, shall transfer from the Administrative Fund, the previously determined and
agreed upon, reasonable compensation for all services rendered by it hereunder, including its
services as Paying Agent/Registrar and extraordinary services rendered, together with all its
reasonable expenses, charges, and other disbursements and those of its counsel, agents and
employees, incurred in and about the administration and execution of the trusts hereby created
and the exercise of its powers and the performance of its duties hereunder, all pursuant to a City
Certificate and subject to any limit on the amount of such compensation or recovery of expenses
or other charges as shall be prescribed by such City Certificate, and the Trustee shall have a lien
therefor on any and all funds at any time held by it hereunder prior to any Bonds Outstanding.
None of the provisions contained in this Indenture shall require the Trustee to expend or risk its
own funds or otherwise incur financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if the Trustee has reasonable grounds for believing that
the repayment of such funds or liability is not reasonably assured to it. If the City shall fail to
make any payment required by this Section, the Trustee shall make such payment from lawfully
available funds in the Administrative Fund, and to the extent moneys in the Administrative Fund
are insufficient then from any moneys in its possession under the provision of this Indenture and
shall be entitled to a preference therefor over any Bonds Outstanding hereunder. The right of the
Trustee to fees, expenses, and indemnification, to the extent permitted by law, shall survive the
release, discharge, and satisfaction of the Indenture.
Section 9.7. Permitted Acts.
The Trustee and its directors, officers, employees, or agents may become the owner of or
may in good faith buy, sell, own, hold and deal in Bonds and may join in any action that any
Owner of Bonds may be entitled to take as fully and with the same rights as if it were not the
Trustee. The Trustee may act as depository, and permit any of its officers or directors to act as a
member of, or in any other capacity with respect to, the City or any committee formed to protect
the rights of holders of Bonds or to effect or aid in any reorganization growing out of the
enforcement of the Bonds or this Indenture, whether or not such committee shall represent the
holders of a majority of the Bonds. The permissive right of the Trustee to do things enumerated
in this Indenture shall not be construed as a duty, and the Trustee shall not be liable for any
permissive actions taken except as a consequence of its own negligence or misconduct.
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Section 9.8. Resignation of Trustee.
The Trustee may at any time resign and be discharged of its duties and obligations
hereunder by giving not fewer than 60 days’ written notice, specifying the date when such
resignation shall take effect, to the City and each Owner of any Outstanding Bond. Such
resignation shall take effect upon the appointment of a successor as provided in Section 9.10 and
the acceptance of such appointment by such successor. Notwithstanding the foregoing, if, after
60 days following receipt of the notice, the City has not appointed a successor Trustee, the
Trustee may apply to a court of competent jurisdiction to appoint a successor Trustee, at no
expense to the City, and such resignation shall take effect upon the court’s appointment of a
successor Trustee.
Section 9.9. Removal of Trustee.
The Trustee may be removed at any time by (i) the Owners of at least a majority in
aggregate Outstanding principal amount of the Bonds by an instrument or concurrent instruments
in writing signed and acknowledged by such Owners or by their attorneys-in-fact, duly
authorized and delivered to the City, or (ii) so long as the City is not in default under this
Indenture, the City. Copies of each such instrument shall be delivered by the City to the Trustee
and any successor thereof. The Trustee may also be removed at any time for any breach of trust
or for acting or proceeding in violation of, or for failing to act or proceed in accordance with, any
provision of this Indenture with respect to the duties and obligations of the Trustee by any court
of competent jurisdiction upon the application of the City or the Owners of not less than 10% in
aggregate Outstanding principal amount of the Bonds.
Section 9.10. Successor Trustee.
a) If the Trustee shall resign, be removed, be dissolved, or become incapable of
acting, or shall be adjudged a bankrupt or insolvent, or if a receiver, liquidator, or conservator of
the Trustee or of its property shall be appointed, or if any public officer shall take charge or
control of the Trustee or of its property or affairs, the position of the Trustee hereunder shall
thereupon become vacant.
b) If the position of Trustee shall become vacant for any of the foregoing reasons or
for any other reason, a successor Trustee may be appointed within one year after any such
vacancy shall have occurred by the Owners of at least 50% of the aggregate Outstanding
principal amount of the Bonds by an instrument or concurrent instruments in writing signed and
acknowledged by such Owners or their attorneys-in-fact, duly authorized and delivered to such
successor Trustee, with notification thereof being given to the predecessor Trustee and the City.
c) Until such successor Trustee shall have been appointed by the Owners of the
Bonds, the City shall forthwith (and in no event in excess of 30 days after such vacancy occurs)
appoint a Trustee to act hereunder. Copies of any instrument of the City providing for any such
appointment shall be delivered by the City to the Trustee so appointed. The City shall mail notice
of any such appointment to each Owner of any Outstanding Bonds within 30 days after such
appointment. Any appointment of a successor Trustee made by the City immediately and without
further act shall be superseded and revoked by an appointment subsequently made by the
Owners.
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c) If in a proper case no appointment of a successor Trustee shall be made within 60
days after the giving by any Trustee of any notice of resignation in accordance with Section 9.8
or after the occurrence of any other event requiring or authorizing such appointment, the Trustee
or any Owner of Bonds may apply to any court of competent jurisdiction for the appointment of
such a successor, and the court may thereupon, after such notice, if any, as the court may deem
proper, appoint such successor and the City shall be responsible for the costs of such
appointment process.
e) Any successor Trustee appointed under the provisions of this Section shall be a
commercial bank or trust company or national banking association (i) having a capital and
surplus and undivided profits aggregating at least $50,000,000, if there be such a commercial
bank or trust company or national banking association willing and able to accept the appointment
on reasonable and customary terms, and (ii) authorized by law to perform all the duties of the
Trustee required by this Indenture.
f) Each successor Trustee shall mail, in accordance with the provisions of the
Bonds, notice of its appointment as Trustee, any rating agency which, at the time of such
appointment, is providing a rating on the Bonds and each of the Owners of the Bonds.
Section 9.11. Transfer of Rights and Property to Successor Trustee.
Any successor Trustee appointed under the provisions of Section 9.10 shall execute,
acknowledge, and deliver to its predecessor and the City an instrument in writing accepting such
appointment, and thereupon such successor, without any further act, deed, or conveyance, shall
become fully vested with all moneys, estates, properties, rights, immunities, powers, duties,
obligations, and trusts of its predecessor hereunder, with like effect as if originally appointed as
Trustee. However, the Trustee then ceasing to act shall nevertheless, on request of the City or of
such successor, execute, acknowledge, and deliver such instruments of conveyance and further
assurance and do such other things as may reasonably be required for more fully and certainly
vesting and confirming in such successor all the rights, immunities, powers, and trusts of such
Trustee and all the right, title, and interest of such Trustee in and to the Trust Estate, and, upon
the receipt of payment of its outstanding charges, shall pay over, assign, and deliver to such
successor any moneys or other properties subject to the trusts and conditions herein set forth.
Should any deed, conveyance, or instrument in writing from the City be required by such
successor for more fully and certainly vesting in and confirming to it any such moneys, estates,
properties, rights, powers, duties, or obligations, any and all such deeds, conveyances, and
instruments in writing, on request and so far as may be authorized by law, shall be executed,
acknowledged, and delivered by the City.
Section 9.12. Merger, Conversion or Consolidation of Trustee.
Any corporation or association into which the Trustee may be merged or with which it
may be consolidated or any corporation or association resulting from any merger, conversion or
consolidation to which it shall be a party or any corporation or association to which the Trustee
may sell or transfer all or substantially all of its corporate trust business shall be the successor to
such Trustee hereunder, without any further act, deed or conveyance, provided that such
corporation or association shall be a commercial bank or trust company or national banking
association qualified to be a successor to such Trustee under the provisions of Section 9.10, or a
trust company that is a wholly-owned subsidiary of any of the foregoing.
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Section 9.13. Trustee To File Continuation Statements.
Chapter 1208, Texas Government Code, applies to the issuance of the Bonds and the
pledge of the Trust Estate provided herein, and such pledge is, under current law, valid, effective
and perfected. If necessary, the Trustee shall file or cause to be filed, at the City’s expense, such
continuation statements as may be delivered to the Trustee and which may be required by the
Texas Uniform Commercial Code, as from time to time in effect (the "UCC"), in order to
continue perfection of the security interest of the Trustee in such items of tangible or intangible
personal property and any fixtures as may have been granted to the Trustee pursuant to this
Indenture in the time, place and manner required by the UCC; provided unless the Trustee is
otherwise notified by the City, the Trustee may conclusively rely upon the initial filing
statements delivered to it in filing any continuation statements hereunder. The Trustee is not
responsible for the initial filing of any financing statements. The City shall timely delivery a
copy of such filed financing statement, if any, to the Trustee.
Section 9.14. Accounts, Periodic Reports and Certificates.
The Trustee shall keep or cause to be kept proper books of record and account (separate
from all other records and accounts) in which complete and correct entries shall be made of its
transactions relating to the Funds and Accounts established by this Indenture and which shall at
all times be subject to inspection by the City, and the Owner or Owners of not less than 10% in
principal amount of the Bonds then Outstanding or their representatives duly authorized in
writing.
Section 9.15. Construction of Indenture.
The Trustee may construe any of the provisions of this Indenture insofar as the same may
appear to be ambiguous or inconsistent with any other provision hereof, and any construction of
any such provisions hereof by the Trustee in good faith shall be binding upon the Owners of the
Bonds.
Section 9.16. Offering Documentation.
The Trustee shall have no responsibility with respect to any information, statement, or
recital in any official statement, offering memorandum, or any other disclosure material prepared
or distributed with respect to the Bonds and, except as otherwise provided in the Continuing
Disclosure Agreement of the Issuer approved in the Bond Ordinance, shall have no responsibility
for compliance with any State or federal securities laws in connection with the Bonds.
ARTICLE X
MODIFICATION OR AMENDMENT OF THIS INDENTURE
Section 10.1. Amendments Permitted.
a) This Indenture and the rights and obligations of the City and of the Owners of the
Bonds may be modified or amended at any time by a Supplemental Indenture, except as provided
below, pursuant to the affirmative vote at a meeting of Owners of the Bonds, or with the written
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consent without a meeting, of the Owners of the Bonds of at least a majority of the aggregate
principal amount of the Bonds then Outstanding and City approval of such modification or
amendment. No such modification or amendment shall (i) extend the maturity of any Bond or
reduce the principal of or interest rate thereon, or otherwise alter or impair the obligation of the
City to pay the principal of, and the interest and any premium on, any Bond, without the express
consent of the Owner of such Bond, (ii) permit the creation by the City of any pledge or lien
upon the Trust Estate, or any portion thereof, superior to or on a parity with the pledge and lien
created for the benefit of the Bonds (except for the issuance of Refunding Bonds or as otherwise
permitted by Applicable Laws or this Indenture), or (iii) reduce the percentage of Owners of the
Bonds required for the amendment hereof. Any such amendment shall not modify any of the
rights or obligations of the Trustee without its written consent.
b) This Indenture and the rights and obligations of the City and of the Owners may
also be modified or amended at any time by a Supplemental Indenture, without the consent of
any Owners, only to the extent permitted by law, and only for any one or more of the following
purposes:
i) to add to the covenants and agreements of the City in this Indenture
contained, other covenants and agreements thereafter to be observed, or to limit or
surrender any right or power herein reserved to or conferred upon the City;
ii) to make modifications not adversely affecting any Outstanding Bonds in
any material respect;
iii) to make such provisions for the purpose of curing any ambiguity,
or of curing, correcting or supplementing any defective provision contained in this
Indenture, or in regard to questions arising under this Indenture, as the City and the
Trustee may deem necessary or desirable and not inconsistent with this Indenture, and
that shall not adversely affect the rights of the Owners of the Bonds;
iv) to set forth additional provisions, if deemed necessary or advisable, in
connection with the issuance of Refunding Bonds permitted under the terms of this
Indenture; and
v) to make such additions, deletions or modifications as may be necessary or
desirable to assure exemption from federal income taxation of interest on the Bonds.
Section 10.2. Owners’ Meetings.
The City may at any time call a meeting of the Owners of the Bonds. In such event the
City is authorized to fix the time and place of said meeting and to provide for the giving of notice
thereof, and to fix and adopt reasonable rules and regulations for the conduct of said meeting;
provided, however, that the same may not conflict with the terms of this Indenture. Without
limiting the generality of the immediately preceding sentence, such rules and regulations may not
reduce the percentage of Owners of Bonds required for the amendment of this Indenture as
provided herein.
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Section 10.3. Procedure for Amendment with Written Consent of Owners.
a) The City and the Trustee may at any time adopt a Supplemental Indenture
amending the provisions of the Bonds or of this Indenture, to the extent that such amendment is
permitted by Section 10.1, to take effect when and as provided in this Section. A copy of such
Supplemental Indenture, together with a request to Owners for their consent thereto, if such
consent is required pursuant to Section 10.1, shall be mailed by first class mail, by the Trustee to
each Owner of Bonds from whom consent is required under this Indenture, but failure to mail
copies of such Supplemental Indenture and request shall not affect the validity of the
Supplemental Indenture when assented to as in this Section provided.
b) Such Supplemental Indenture shall not become effective unless there shall be
filed with the Trustee the written consents of the Owners as required by this Indenture and a
notice shall have been mailed as hereinafter in this Section provided and the City has delivered to
the Trustee an opinion of Bond Counsel to the effect that such amendment is permitted and will
not adversely affect the exclusion of interest on the Bonds from gross income for purposes of
federal income taxation. Each such consent shall be effective only if accompanied by proof of
ownership of the Bonds for which such consent is given, which proof shall be such as is
permitted by Section 11.6. Any such consent shall be binding upon the Owner of the Bonds
giving such consent and on any subsequent Owner (whether or not such subsequent Owner has
notice thereof), unless such consent is revoked in writing by the Owner giving such consent or a
subsequent Owner by filing such revocation with the Trustee prior to the date when the notice
hereinafter in this Section provided for has been mailed.
c) After the Owners of the required percentage of Bonds shall have filed their
consents to the Supplemental Indenture, the City shall mail a notice to the Owners in the manner
hereinbefore provided in this Section for the mailing of the Supplemental Indenture, stating in
substance that the Supplemental Indenture has been consented to by the Owners of the required
percentage of Bonds and will be effective as provided in this Section (but failure to mail copies
of said notice shall not affect the validity of the Supplemental Indenture or consents thereto).
Proof of the mailing of such notice shall be filed with the Trustee. A record, consisting of the
papers required by this Section 10.3 to be filed with the Trustee, shall be proof of the matters
therein stated until the contrary is proved. The Supplemental Indenture shall become effective
upon the filing with the Trustee of the proof of mailing of such notice, and the Supplemental
Indenture shall be deemed conclusively binding (except as otherwise hereinabove specifically
provided in this Article) upon the City and the Owners of all Bonds at the expiration of sixty (60)
days after such filing, except in the event of a final decree of a court of competent jurisdiction
setting aside such consent in a legal action or equitable proceeding for such purpose commenced
within such sixty-day period.
Section 10.4. Procedure for Amendment Not Requiring Owner Consent.
a) The City and the Trustee may at any time adopt a Supplemental Indenture
amending the provisions of the Bonds or of this Indenture, to the extent that such amendment is
permitted by Section 10.1, to take effect when and as provided in this Section. The City shall
direct the Trustee to provide a copy of such Supplemental Indenture, together with a notice
stating that the Supplemental Indenture does not require Owner consent, mailed by first class
mail to each Owner of Bonds, but failure to mail copies of such Supplemental Indenture shall not
affect the validity of the Supplemental Indenture. The Trustee shall retain the proof of its
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mailing of such notice. A record, consisting of the papers required by this Section 10.4, shall be
proof of the matters therein stated until the contrary is proved.
b) The Supplemental Indenture shall become effective upon the execution and
delivery of such Supplemental Indenture by the Trustee and the City, and the Supplemental
Indenture shall be deemed conclusively binding upon the City, the Trustee and the Owners of all
Bonds as of the date of such execution and delivery.
Section 10.5. Effect of Supplemental Indenture.
From and after the time any Supplemental Indenture becomes effective pursuant to this
Article X, this Indenture shall be deemed to be modified and amended in accordance therewith,
the respective rights, duties, and obligations under this Indenture of the City, the Trustee and all
Owners of Bonds Outstanding shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments, and all the terms and conditions of
any such Supplemental Indenture shall be deemed to be part of the terms and conditions of this
Indenture for any and all purposes.
Section 10.6. Endorsement or Replacement of Bonds Issued After Amendments.
The City may determine that Bonds issued and delivered after the effective date of any
action taken as provided in this Article X shall bear a notation, by endorsement or otherwise, in
form approved by the City, as to such action. In that case, upon demand of the Owner of any
Bond Outstanding at such effective date and presentation of his Bond for that purpose at the
designated office of the Trustee or at such other office as the City may select and designate for
that purpose, a suitable notation shall be made on such Bond. The City may determine that new
Bonds, so modified as in the opinion of the City is necessary to conform to such Owners’ action,
shall be prepared, executed, and delivered. In that case, upon demand of the Owner of any Bonds
then Outstanding, such new Bonds shall be exchanged at the designated office of the Trustee
without cost to any Owner, for Bonds then Outstanding, upon surrender of such Bonds.
Section 10.7. Amendatory Endorsement of Bonds.
The provisions of this Article X shall not prevent any Owner from accepting any
amendment as to the particular Bonds held by such Owner, provided that due notation thereof is
made on such Bonds.
Section 10.8. Waiver of Default.
With the written consent of the Owners of at least a majority in aggregate principal
amount of the Bonds then Outstanding, the Owners may waive compliance by the City with
certain past defaults under this Indenture and their consequences. Any such consent shall be
conclusive and binding upon the Owners and upon all future Owners.
Section 10.9. Execution of Supplemental Indenture.
a) In executing, or accepting the additional trusts created by, any Supplemental
Indenture permitted by this Article or the modification thereby of the trusts created by this
Indenture, the Trustee shall receive, and shall be fully protected in relying upon, an opinion of
counsel addressed and delivered to the Trustee and the City stating that the execution of such
Supplemental Indenture is permitted by and in compliance with this Indenture. The Trustee may,
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but shall not be obligated to, enter into any such Supplemental Indenture which affects the
Trustee’s own rights, duties or immunities under this Indenture or otherwise.
b) No such amendment shall modify any of the rights or obligations of the Trustee
without its written consent. In executing or accepting any Supplemental Indenture, the Trustee
shall be fully protected in relying upon an opinion of qualified counsel addressed and delivered
to the Trustee stating that (i) the execution of such Supplemental Indenture is permitted by and in
compliance with this Indenture, (ii) the execution and delivery of the Supplemental Indenture
will not adversely affect the exclusion from federal gross income of the interest on the Bonds,
and (iii) such Supplemental Indenture will, upon the execution and delivery thereof, to be a valid
and binding obligation of the City.
ARTICLE XI
DEFAULT AND REMEDIES
Section 11.1. Events of Default.
Each of the following occurrences or events shall be and is hereby declared to be an
Event of Default," to wit:
i) The failure of the City to deposit the Pledged Revenues to the Pledged
Revenue Fund;
ii) The failure of the City to enforce the collection of the Improvement Area
1 Assessments including the prosecution of foreclosure proceedings, in accordance with
Section 7.2;
iii) Default in the performance or observance of any covenant, agreement or
obligation of the City under this Indenture, other than a default under (iv) below, and the
continuation thereof for a period of ninety (90) days after written notice specifying such default
and requiring same to be remedied shall have been given to the City by the Trustee, which may
give such notice in its discretion and which shall give such notice at the written request of the
Owners of not less than 51% in aggregate Outstanding principal amount of the Bonds; provided,
however, if the default stated in the notice is capable of cure but cannot reasonably be cured
within the applicable period, the City shall be entitled to a further extension of time reasonably
necessary to remedy such default so long as corrective action is instituted by the City within the
applicable period and is diligently pursued until such failure is corrected, but in no event for a
period of time of more than one hundred eighty (180) days after such notice; and
iv) The failure to make payment of the principal of or interest on any of the
Bonds when the same becomes due and payable and such failure is not remedied within thirty
30) days thereafter.
The Trustee shall not be charged with knowledge of (a) any events or other information,
or (b) any default under this Indenture or any other agreement unless a responsible officer of the
Trustee shall have actual knowledge thereof.
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Section 11.2. Immediate Remedies for Default.
a) Subject to Article VIII, upon the happening and continuance of any of the Events
of Default described in Section 11.1, then and in every such case the Trustee may proceed, and
upon the written request of the Owners of not less than 51% in aggregate Outstanding principal
amount of the Bonds hereunder shall proceed, to protect and enforce the rights of the Owners
under this Indenture, by action seeking mandamus or by other suit, action, or special proceeding
in equity or at law, in any court of competent jurisdiction, for any relief to the extent permitted
by Applicable Laws, including, but not limited to, the specific performance of any covenant or
agreement contained herein, or injunction; provided, however, that no action for money damages
against the City may be sought or shall be permitted.
b) PURSUANT TO SECTION 11.7, THE PRINCIPAL OF THE BONDS SHALL
NOT BE SUBJECT TO ACCELERATION UNDER ANY CIRCUMSTANCES.
c) If the assets of the Trust Estate are sufficient to pay all amounts due with respect
to Outstanding Bonds, in the selection of Trust Estate assets to be used in the payment of Bonds
due under this Article, the City shall determine, in its absolute discretion, and shall instruct the
Trustee by City Certificate, which Trust Estate assets shall be applied to such payment and shall
not be liable to any Owner or other Person by reason of such selection and application. In the
event that the City shall fail to deliver to the Trustee such City Certificate, the Trustee shall
select and liquidate or sell Trust Estate assets as provided in the following paragraph, and shall
not be liable to any Owner, or other Person, or the City by reason of such selection, liquidation
or sale. The Trustee shall have no liability for its selection of Trust Estate assets to liquidate or
sell.
d) Whenever moneys are to be applied pursuant to this Article XI, irrespective of
and whether other remedies authorized under this Indenture shall have been pursued in whole or
in part, the Trustee may cause any or all of the assets of the Trust Estate, including Investment
Securities, to be sold. The Trustee may so sell the assets of the Trust Estate and all right, title,
interest, claim and demand thereto and the right of redemption thereof, in one or more parts, at
any such place or places, and at such time or times and upon such notice and terms as the Trustee
may deem appropriate, and as may be required by law and apply the proceeds thereof in
accordance with the provisions of this Section. Upon such sale, the Trustee may make and
deliver to the purchaser or purchasers a good and sufficient assignment or conveyance for the
same, which sale shall be a perpetual bar both at law and in equity against the City, and all other
Persons claiming such properties. No purchaser at any sale shall be bound to see to the
application of the purchase money proceeds thereof or to inquire as to the authorization,
necessity, expediency, or regularity of any such sale. Nevertheless, if so requested by the
Trustee, the City shall ratify and confirm any sale or sales by executing and delivering to the
Trustee or to such purchaser or purchasers all such instruments as may be necessary or, in the
reasonable judgment of the Trustee, proper for the purpose which may be designated in such
request.
Section 11.3. Restriction on Owner’s Action.
a) No Owner shall have any right to institute any action, suit or proceeding at law or
in equity for the enforcement of this Indenture or for the execution of any trust thereof or any
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other remedy hereunder, unless (i) a default has occurred and is continuing of which the Trustee
has been notified in writing as provided in Section 11.1, or of which by such Section it is deemed
to have notice, (ii) such default has become an Event of Default and the Owners of not less than
51% of the aggregate principal amount of the Bonds then Outstanding have made written request
to the Trustee and offered it reasonable opportunity either to proceed to exercise the powers
hereinbefore granted or to institute such action, suit or proceeding in its own name, (iii) the
Owners have furnished to the Trustee written evidence of indemnity as provided in Section 9.2,
iv) the Trustee has for 60 days after such notice failed or refused to exercise the powers
hereinbefore granted, or to institute such action, suit, or proceeding in its own name, (v) no
written direction inconsistent with such written request has been given to the Trustee during such
60-day period by the Owners of a majority of the aggregate principal amount of the Bonds then
Outstanding, and (vi) notice of such action, suit, or proceeding is given to the Trustee in writing;
however, no one or more Owners of the Bonds shall have any right in any manner whatsoever to
affect, disturb, or prejudice this Indenture by its, his or their action or to enforce any right
hereunder except in the manner provided herein, and that all proceedings at law or in equity shall
be instituted and maintained in the manner provided herein and for the equal benefit of the
Owners of all Bonds then Outstanding. The notification, request and furnishing of indemnity set
forth above shall, at the option of the Trustee as advised by its counsel, be conditions precedent
to the execution of the powers and trusts of this Indenture and to any action or cause of action for
the enforcement of this Indenture or for any other remedy hereunder.
b) Subject to Article VIII, nothing in this Indenture shall affect or impair the right of
any Owner to enforce, by action at law, payment of any Bond at and after the maturity thereof, or
on the date fixed for redemption or the obligation of the City to pay each Bond issued hereunder
to the respective Owners thereof at the time and place, from the source and in the manner
expressed herein and in the Bonds.
c) In case the Trustee or any Owners shall have proceeded to enforce any right under
this Indenture and such proceedings shall have been discontinued or abandoned for any reason or
shall have been determined adversely to the Trustee or any Owners, then and in every such case
the City, the Trustee and the Owners shall be restored to their former positions and rights
hereunder, and all rights, remedies and powers of the Trustee shall continue as if no such
proceedings had been taken.
Section 11.4. Application of Revenues and Other Moneys After Default.
a) All moneys, securities, funds, Pledged Revenues and other assets of the Trust
Estate and the income therefrom received by the Trustee pursuant to any right given or action
taken under the provisions of this Article shall, after payment of the cost and expenses of the
proceedings resulting in the collection of such amounts, the expenses (including its counsel fees,
costs, and expenses), liabilities, and advances incurred or made by the Trustee and the fees of the
Trustee in carrying out this Indenture, during the continuance of an Event of Default,
notwithstanding Section 11.2, be applied by the Trustee, on behalf of the City, to the payment of
interest and principal or Redemption Price then due on Bonds, as follows:
FIRST: To the payment to the Owners entitled thereto all installments of interest then due
in the direct order of maturity of such installments, and, if the amount available shall not
be sufficient to pay in full any installment, then to the payment thereof ratably, according
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to the amounts due on such installment, to the Owners entitled thereto, without any
discrimination or preference; and
SECOND: To the payment to the Owners entitled thereto of the unpaid principal of
Outstanding Bonds, or Redemption Price of any Bonds which shall have become due,
whether at maturity or by call for redemption, in the direct order of their due dates and, if
the amounts available shall not be sufficient to pay in full all the Bonds due on any date,
then to the payment thereof ratably, according to the amounts of principal due or
Redemption Price and to the Owners entitled thereto, without any discrimination or
preference.
The Trustee shall make payments to the Owners pursuant to this Section 11.4 within
thirty (30) days of receipt of such good and available funds, and the record date shall be the date
the Trustee receives such good and available funds.
b) In the event funds are not adequate to cure any of the Events of Default described
in Section 11.1, the available funds shall be allocated to the Bonds that are Outstanding in
proportion to the quantity of Bonds that are currently due and in default under the terms of this
Indenture.
c) The restoration of the City to its prior position after any and all defaults have been
cured, as provided in Section 11.3, shall not extend to or affect any subsequent default under this
Indenture or impair any right consequent thereon.
Section 11.5. Effect of Waiver.
No delay or omission of the Trustee, or any Owner, to exercise any right or power
accruing upon any default shall impair any such right or power or shall be construed to be a
waiver of any such default or an acquiescence therein; and every power and remedy given by this
Indenture to the Trustee or the Owners, respectively, may be exercised from time to time and as
often as may be deemed expedient.
Section 11.6. Evidence of Ownership of Bonds.
a) Any request, consent, revocation of consent or other instrument which this
Indenture may require or permit to be signed and executed by the Owners may be in one or more
instruments of similar tenor, and shall be signed or executed by such Owners in person or by
their attorneys duly appointed in writing. Proof of the execution of any such instrument, or of
any instrument appointing any such attorney, or the holding by any Person of the Bonds shall be
sufficient for any purpose of this Indenture (except as otherwise herein expressly provided) if
made in the following manner:
i) The fact and date of the execution of such instruments by any Owner of
Bonds or the duly appointed attorney authorized to act on behalf of such Owner may be
provided by a guarantee of the signature thereon by a bank or trust company or by the
certificate of any notary public or other officer authorized to take acknowledgments of
deeds, that the Person signing such request or other instrument acknowledged to him the
execution thereof, or by an affidavit of a witness of such execution, duly sworn to before
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such notary public or other officer. Where such execution is by an officer of a corporation
or association or a member of a partnership, on behalf of such corporation, association or
partnership, such signature guarantee, certificate, or affidavit shall also constitute
sufficient proof of his authority.
ii) The ownership of Bonds and the amount, numbers and other identification
and date of holding the same shall be proved by the Register.
b) Except as otherwise provided in this Indenture with respect to revocation of a
consent, any request or consent by an Owner of any Bond shall bind all future Owners of the
same Bond in respect of anything done or suffered to be done by the City or the Trustee in
accordance therewith.
Section 11.7. No Acceleration.
In the event of the occurrence of an Event of Default under Section 11.1, the right of
acceleration of any Stated Maturity is not granted as a remedy hereunder and the right of
acceleration under this Indenture is expressly denied.
Section 11.8. Mailing of Notice.
Any provision in this Article for the mailing of a notice or other document to Owners
shall be fully complied with if it is mailed, first class postage prepaid, only to each Owner at the
address appearing upon the Register.
Section 11.9. Exclusion of Bonds.
Bonds owned or held by or for the account of the City will not be deemed Outstanding
for the purpose of consent or other action or any calculation of Outstanding Bonds provided for
in this Indenture, and the City shall not be entitled with respect to such Bonds to give any
consent or take any other action provided for in this Indenture.
ARTICLE XII
GENERAL COVENANTS AND REPRESENTATIONS
Section 12.1. Representations as to Trust Estate.
a) The City represents and warrants that it is authorized by Applicable Laws to
authorize and issue the Bonds, to execute and deliver this Indenture and to pledge the Trust
Estate in the manner and to the extent provided in this Indenture, and that the Trust Estate is and
will be and remain free and clear of any pledge, lien, charge, or encumbrance thereon or with
respect thereto prior to, or of equal rank with, the pledge and lien created in or authorized by this
Indenture except as expressly provided herein.
b) The City shall at all times, to the extent permitted by Applicable Laws, defend,
preserve and protect the pledge of the Trust Estate and all the rights of the Owners and the
Trustee, under this Indenture against all claims and demands of all Persons whomsoever.
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c) Subject to Section 7.2(d), the City will take all steps reasonably necessary and
appropriate, and will provide written direction to the Trustee to take all steps reasonably
necessary and appropriate, to collect all delinquencies in the collection of the Improvement Area
1 Assessments and any other amounts pledged to the payment of the Bonds to the fullest extent
permitted by the PID Act and other Applicable Laws.
Section 12.2. General.
The City shall do and perform or cause to be done and performed all acts and things
required to be done or performed by or on behalf of the City under the provisions of this
Indenture.
ARTICLE XIII
SPECIAL COVENANTS
Section 13.1. Further Assurances; Due Performance.
a) At any and all times the City will duly execute, acknowledge and deliver, or will
cause to be done, executed and delivered, all and every such further acts, conveyances, transfers,
and assurances in a manner as the Trustee shall reasonably require for better conveying,
transferring, pledging, and confirming unto the Trustee, all and singular, the revenues, Funds,
Accounts and properties constituting the Pledged Revenues, and the Trust Estate hereby
transferred and pledged, or intended so to be transferred and pledged.
b) The City will duly and punctually keep, observe and perform each and every
term, covenant and condition on its part to be kept, observed and performed, contained in this
Indenture.
Section 13.2. Other Obligations or Other Liens; Refunding Bonds.
a) The City reserves the right, subject to the provisions contained in this
Section 13.2, to issue Other Obligations under other indentures, assessment ordinances, or
similar agreements or other obligations which do not constitute or create a lien on the Trust
Estate and are not payable from the Trust Estate, or any portion thereof.
b) Other than Refunding Bonds, or subordinate lien obligations permitted hereunder,
the City will not create or voluntarily permit to be created any debt, lien or charge on the Trust
Estate, or any portion thereof, and will not do or omit to do or suffer to be done or omit to be
done any matter or things whatsoever whereby the lien of this Indenture or the priority hereof
might or could be lost or impaired; provided, however, that the City has reserved the right to
issue bonds or other obligations secure by and payable from the Trust Estate so long as such
pledge is subordinate to the pledge of the Trust Estate securing payment of the Bonds.
c) Notwithstanding any contrary provision of this Indenture but subject to
Section 7.3, the City shall not issue additional bonds, notes or other obligations under this
Indenture, secured by any pledge of or other lien or charge on the Trust Estate or other property
pledged under this Indenture, other than Refunding Bonds and subordinate lien obligations
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permitted hereunder. The City reserves the right to issue Refunding Bonds, the proceeds of
which would be utilized to refund all or any portion of the Outstanding Bonds or Outstanding
Refunding Bonds and to pay all costs incident to the Refunding Bonds, as authorized by the laws
of the State.
Section 13.3. Books of Record.
a) The City shall cause to be kept full and proper books of record and accounts, in
which full, true and proper entries will be made of all dealings, business and affairs of the City,
which relate to the Trust Estate and the Bonds.
b) The Trustee shall have no responsibility with respect to the financial and other
information received by it pursuant to this Section 13.3 except to receive and retain same, subject
to the Trustee’s document retention policies, and to distribute the same in accordance with the
provisions of this Indenture.
ARTICLE XIV
PAYMENT AND CANCELLATION OF THE BONDS AND SATISFACTION OF THE
INDENTURE
Section 14.1. Trust Irrevocable.
The trust created by the terms and provisions of this Indenture is irrevocable until the
Bonds secured hereby are fully paid or provision is made for their payment as provided in this
Article.
Section 14.2. Satisfaction of Indenture.
If the City shall pay or cause to be paid, or there shall otherwise be paid to the Owners,
principal of and interest on all of the Bonds, at the times and in the manner stipulated in this
Indenture, and all amounts due and owing with respect to the Bonds have been paid or provided
for, then the pledge of the Trust Estate and all covenants, agreements, and other obligations of
the City to the Owners of such Bonds, shall thereupon cease, terminate, and become void and be
discharged and satisfied. In such event, the Trustee shall execute and deliver to the City copies of
all such documents as it may have evidencing that principal of and interest on all of the Bonds
has been paid so that the City may determine if this Indenture is satisfied; if so, the Trustee shall
pay over or deliver all moneys held by it in the Funds and Accounts held hereunder to the Person
entitled to receive such amounts, or, if no Person is entitled to receive such amounts, then to the
City.
Section 14.3. Bonds Deemed Paid.
a) Any Outstanding Bonds shall, prior to the Stated Maturity or redemption date
thereof, be deemed to have been paid and no longer Outstanding within the meaning of this
Indenture (a "Defeased Debt"), and particularly this Article XIV, when payment of the principal
of, premium, if any, on such Defeased Debt, plus interest thereon to the due date thereof
whether such due date be by reason of maturity, redemption, or otherwise), either (1) shall have
been made in accordance with the terms thereof, or (2) shall have been provided by irrevocably
depositing with the Trustee, in trust, and irrevocably set aside exclusively for such payment,
A) money sufficient to make such payment or (B) Defeasance Securities that mature as to
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principal and interest in such amount and at such times as will insure the availability, without
reinvestment, of sufficient money to make such payment, and all necessary and proper fees,
compensation, and expenses of the Trustee pertaining to the Bonds with respect to which such
deposit is made shall have been paid or the payment thereof provided for to the satisfaction of
the Trustee. Neither Defeasance Securities nor moneys deposited with the Trustee pursuant to
this Section nor principal or interest payments on any such Defeasance Securities shall be
withdrawn or used for any purpose other than, and shall be held in trust for, the payment of the
principal of and interest on the Bonds and shall not be part of the Trust Estate. Any cash received
from such principal of and interest on such Defeasance Securities deposited with the Trustee, if
not then needed for such purpose, shall be reinvested in Defeasance Securities as directed by the
City maturing at times and in amounts sufficient to pay when due the principal of and interest on
the Bonds on and prior to such redemption date or maturity date thereof, as the case may be.
Any payment for Defeasance Securities purchased for the purpose of reinvesting cash as
aforesaid shall be made only against delivery of such Defeasance Securities.
b) Any determination not to redeem Defeased Debt that is made in conjunction with
the payment arrangements specified in Sections 14.3(a)(1) or 14.3(a)(2) shall not be irrevocable,
provided that: (1) in the proceedings providing for such defeasance, the City expressly reserves
the right to call the Defeased Debt for redemption; (2) the City gives notice of the reservation of
that right to the Owners of the Defeased Debt immediately following the defeasance; (3) the City
directs that notice of the reservation be included in any defeasance or redemption notices that it
authorizes; and (4) at or prior to the time of the redemption, the City satisfies the conditions of
clause (a) of this Section 14.3 with respect to such Defeased Debt as though it was being
defeased at the time of the exercise of the option to redeem the Defeased Debt, after taking the
redemption into account in determining the sufficiency of the provisions made for the payment
of the Defeased Debt.
c) Until all Defeased Debt shall have become due and payable, the Trustee and the
Paying Agent/Registrar each shall perform the services of Trustee and Paying Agent/Registrar
for such Defeased Debt the same as if they had not been defeased, and the City shall make
proper arrangements to provide and pay for such services as required by this Indenture.
ARTICLE XV
MISCELLANEOUS
Section 15.1. Benefits of Indenture Limited to Parties.
Nothing in this Indenture, expressed or implied, is intended to give to any Person other
than the City, the Trustee and the Owners, any right, remedy, or claim under or by reason of this
Indenture. Any covenants, stipulations, promises or agreements in this Indenture by and on
behalf of the City shall be for the sole and exclusive benefit of the Owners and the Trustee. This
Indenture and the exhibits hereto set forth the entire agreement and understanding of the parties
related to this transaction and supersedes all prior agreements and understandings, oral or
written.
Section 15.2. Successor is Deemed Included in All References to Predecessor.
Whenever in this Indenture or any Supplemental Indenture either the City or the Trustee
is named or referred to, such reference shall be deemed to include the successors or assigns
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thereof, and all the covenants and agreements in this Indenture contained by or on behalf of the
City or the Trustee shall bind and inure to the benefit of the respective successors and assigns
thereof whether so expressed or not.
Section 15.3. Execution of Documents and Proof of Ownership by Owners.
a) Any request, declaration, or other instrument which this Indenture may require or
permit to be executed by Owners may be in one or more instruments of similar tenor, and shall
be executed by Owners in person or by their attorneys duly appointed in writing.
b) Except as otherwise expressly provided herein, the fact and date of the execution
by any Owner or his attorney of such request, declaration, or other instrument, or of such writing
appointing such attorney, may be proved by the certificate of any notary public or other officer
authorized to take acknowledgments of deeds to be recorded in the state in which he purports to
act, that the Person signing such request, declaration, or other instrument or writing
acknowledged to him the execution thereof, or by an affidavit of a witness of such execution,
duly sworn to before such notary public or other officer.
c) Except as otherwise herein expressly provided, the ownership of registered Bonds
and the amount, maturity, number, and date of holding the same shall be proved by the Register.
d) Any request, declaration or other instrument or writing of the Owner of any Bond
shall bind all future Owners of such Bond in respect of anything done or suffered to be done by
the City or the Trustee in good faith and in accordance therewith.
Section 15.4. No Waiver of Personal Liability.
No member, officer, agent, or employee of the City shall be individually or personally
liable for the payment of the principal of, or interest or any premium on, the Bonds; but nothing
herein contained shall relieve any such member, officer, agent, or employee from the
performance of any official duty provided by law.
Section 15.5. Notices to and Demands on City and Trustee.
a) Except as otherwise expressly provided herein, all notices or other instruments
required or permitted under this Indenture shall be in writing and shall be delivered by hand, or
mailed by first class mail, postage prepaid, and addressed as follows:
If to the City City of Anna, Texas
120 W. 7th St.
Anna, Texas 75409
Attn: City Manager
Telephone: (972) 924-3325
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If to the Trustee, initially also acting in
the capacity of Paying Agent/Registrar
Regions Bank
1717 McKinney Avenue
Dallas, Texas 75202
Attn: Corporate Trust Services
Telephone: (214) 220-6158
b) Any such notice, demand, or request may also be transmitted to the appropriate
party by telegram or telephone and shall be deemed to be properly given or made at the time of
such transmission if, and only if, such transmission of notice shall be confirmed in writing and
sent as specified above.
c) Any of such addresses may be changed at any time upon written notice of such
change given to the other party by the party effecting the change. Notices and consents given by
mail in accordance with this Section shall be deemed to have been given five Business Days after
the date of dispatch; notices and consents given by any other means shall be deemed to have
been given when received.
d) The Trustee shall mail to each Owner of a Bond notice of the redemption or
defeasance of all Bonds Outstanding.
Section 15.6. Partial Invalidity.
If any Section, paragraph, sentence, clause, or phrase of this Indenture shall for any
reason be held illegal or unenforceable, such holding shall not affect the validity of the remaining
portions of this Indenture. The City hereby declares that it would have adopted this Indenture and
each and every other Section, paragraph, sentence, clause, or phrase hereof and authorized the
issue of the Bonds pursuant thereto irrespective of the fact that anyone or more Sections,
paragraphs, sentences, clauses, or phrases of this Indenture may be held illegal, invalid, or
unenforceable.
Section 15.7. Applicable Laws.
This Indenture shall be governed by and enforced in accordance with the laws of the
State applicable to contracts made and performed in the State. Venue and exclusive jurisdiction
for any action to enforce or construe this Indenture shall be a state court of competent
jurisdiction in Collin County, Texas or any federal court with diversity jurisdiction.
Section 15.8. Payment on Business Day.
In any case where the date of the maturity of interest or of principal (and premium, if
any) of the Bonds or the date fixed for redemption of any Bonds or the date any action is to be
taken pursuant to this Indenture is other than a Business Day, the payment of interest or principal
and premium, if any) or the action need not be made on such date but may be made on the next
succeeding day that is a Business Day with the same force and effect as if made on the date
required and no interest shall accrue for the period from and after such date.
Section 15.9. CFA Agreement Amendments and Supplements.
The City and the Developer may amend and supplement the CFA Agreement from time
to time without the consent or approval of the Owners or the Trustee.
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Section 15.10. Counterparts.
This Indenture may be executed in counterparts, each of which shall be deemed an
original.
Section 15.11. Texas Government Code Verifications.
a) The Trustee makes the following representations and covenants pursuant to
Chapters 2252, 2271, 2274, and 2276, Texas Government Code, as amended (the “Government
Code”), in entering into this Indenture. As used in such verifications, "affiliate" means an entity
that controls, is controlled by, or is under common control with the Trustee within the meaning
of SEC Rule 405, 17 C.F.R. § 230.405, and exists to make a profit. Liability for breach of any
such verification during the term of this Indenture shall survive until barred by the applicable
statute of limitations, and shall not be liquidated or otherwise limited by any provision of this
Indenture, notwithstanding anything in this Indenture to the contrary.
1) Not a Sanctioned Company. The Trustee represents that neither it nor any
of its parent company, wholly- or majority-owned subsidiaries, and other affiliates is a
company identified on a list prepared and maintained by the Texas Comptroller of Public
Accounts under Section 2252.153 or Section 2270.0201, Government Code. The
foregoing representation excludes the Trustee and each of its parent company, wholly- or
majority-owned subsidiaries, and other affiliates, if any, that the United States
government has affirmatively declared to be excluded from its federal sanctions regime
relating to Sudan or Iran or any federal sanctions regime relating to a foreign terrorist
organization.
2) No Boycott of Israel. The Trustee hereby verifies that it and its parent
company, wholly- or majority-owned subsidiaries, and other affiliates, if any, do not
boycott Israel and will not boycott Israel during the term of this Indenture. As used in the
foregoing verification, “boycott Israel” has the meaning provided in Section 2271.001,
Government Code.
3) No Discrimination Against Firearm Entities. The Trustee hereby verifies
that it and its parent company, wholly- or majority-owned subsidiaries, and other
affiliates, if any, do not have a practice, policy, guidance, or directive that discriminates
against a firearm entity or firearm trade association and will not discriminate against a
firearm entity or firearm trade association during the term of this Indenture. As used in
the foregoing verification, "discriminate against a firearm entity or firearm trade
association" has the meaning provided in Section 2274.001(3), Government Code.
4) No Boycott of Energy Companies. The Trustee hereby verifies that it and
its parent company, wholly- or majority-owned subsidiaries, and other affiliates, if any,
do not boycott energy companies and will not boycott energy companies during the term
of this Indenture. As used in the foregoing verification, "boycott energy companies" has
the meaning provided in Section 2276.001(1), Government Code.
Remainder of page left blank intentionally]
IN WITNESS WHEREOF, the City and the Trustee have caused this Indenture of Trust
to be executed as of the date hereof.
CITY OF ANNA, TEXAS
By: ___________________________
Pete Cain, Mayor
City of Anna, Texas
Attest:
Carrie L. Land, City Secretary
City of Anna, Texas
CITY SEAL)
City Signature Page to Indenture of Trust
REGIONS BANK,
as Trustee
By: ___________________________
Authorized Officer
Trustee Signature Page to Indenture of Trust
THIS PAGE IS LEFT BLANK INTENTIONALLY.
APPENDIX C
FORM OF SERVICE AND ASSESSMENT PLAN
AUSTIN,TX NORTH RICHLAND HILLS,TX HOUSTON,TX
Crystal Park Public
Improvement District No.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
OCTOBER 27,2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
1
TABLE OF CONTENTS
Table of Contents 1
Introduction 2
Section I:Definitions 3
Section II:The District 10
Section III:Authorized Improvements 10
Section IV:Service Plan 13
Section V:Assessment Plan 13
Section VI:Terms of the Assessments 17
Section VII:Assessment Roll 23
Section VIII:Additional Provisions 23
Exhibits 26
Appendices 27
Exhibit A 1 Map of the District 28
Exhibit A 2 Map of Improvement Area 1 29
Exhibit B 1 Project Costs 30
Exhibit B 2 Allocation of Authorized Improvements 32
Exhibit C Service Plan 33
Exhibit D Sources and Uses of Funds 34
Exhibit E Maximum Assessment and Tax Rate Equivalent 35
Exhibit F 1 Improvement Area 1 Assessment Roll 36
Exhibit F 2 Improvement Area 1 Annual Installments 37
Exhibit G 1 Maps of Major Improvements 38
Exhibit G 2 Maps of Improvement Area 1 Improvements 42
Exhibit H Form of Notice of Assessment Termination 46
Exhibit I Debt Service Schedule for Improvement Area 1 Bonds 49
Exhibit J 1 District Legal Description 50
Exhibit J 2 Improvement Area 1 Legal Description 56
Appendix A Engineer’s Report 62
Appendix B Buyer Disclosures 63
Crystal Park No.2 Improvement Area 1 Initial Parcel Buyer Disclosure 64
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
2
INTRODUCTION
Capitalized terms used in this Service and Assessment Plan shall have the meanings given to them
in Section I unless otherwise defined in this Service and Assessment Plan or unless the context in
which a term is used clearly requires a different meaning.Unless otherwise defined,a reference
to a Section,”an Exhibit,”or an Appendix”shall be a reference to a Section of this Service and
Assessment Plan or an Exhibit or Appendix attached to and made a part of this Service and
Assessment Plan for all purposes.
On February 25,2025 the City Council passed and approved Resolution No.2025 02 1744
authorizing the establishment of the District in accordance with the PID Act,which authorization
was effective upon approval in accordance with the PID Act.The purpose of the District is to
finance the Actual Costs of Authorized Improvements that confer a special benefit on
approximately 274.396 acres located within the corporate limits of the City,as described by the
legal description on Exhibit J 1 and depicted on Exhibit A 1.
The PID Act requires that a service plan must i)cover a period of at least five years;ii)define
the annual indebtedness and projected cost of the Authorized Improvements;and iii)include a
copy of the notice form required by Section 5.014 of the Texas Property Code,as amended.The
Service Plan is contained in Section I.
The PID Act requires that the Service Plan include an Assessment Plan that assesses the Actual
Costs of the Authorized Improvements against the Assessed Property within the District based
on the special benefits conferred on such property by the Authorized Improvements.The
Assessment Plan is contained in Section V.
The PID Act requires an Assessment Roll that states the Assessment against each Parcel
determined by the method chosen by the City Council.The Assessment against each Parcel of
Assessed Property must be sufficient to pay the share of the Actual Costs of the Authorized
Improvements apportioned to such Parcel and cannot exceed the special benefit conferred on
the Parcel by such Authorized Improvements.The Improvement Area 1 Assessment Roll is
included as Exhibit F 1.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
3
SECTION I:DEFINITIONS
Actual Costs”mean,with respect to Authorized Improvements,the actual costs paid or incurred
by or on behalf of the Developer either directly or through affiliates),including:1)the costs for
the design,planning,financing,administration/management,acquisition,installation,
construction and/or implementation of such Authorized Improvements;2)the fees paid for
obtaining permits,licenses,or other governmental approvals for such Authorized Improvements;
3)the costs for external professional services,such as engineering,geotechnical,surveying,land
planning,architectural landscapers,appraisals,legal,accounting,and similar professional
services;4)the costs for all labor,bonds,and materials,including equipment and fixtures,owing
to contractors,builders,and materialmen engaged in connection with the acquisition,
construction,or implementation of the Authorized Improvements;5)all related permitting and
public approval expenses,and architectural,engineering,consulting,and other governmental
fees and charges;and 6)costs to implement,administer,and manage the above described
activities including,but not limited to,a construction management fee equal to four percent 4%)
of construction costs if managed by or on behalf of the Developer.
Additional Interest”means the amount collected by the application of the Additional Interest
Rate.
Additional Interest Rate”means the up to 0.50%additional interest rate that may be charged
on Assessments securing PID Bonds pursuant to Section 372.018 of the PID Act.
Administrator”means the City or independent firm designated by the City who shall have the
responsibilities provided in this Service and Assessment Plan,any Indenture,or any other
agreement or document approved by the City related to the duties and responsibilities of the
administration of the District.The initial Administrator is P3Works,LLC.
Annual Collection Costs”mean the actual or budgeted costs and expenses related to the
operation of the District,including,but not limited to,costs and expenses for:1)the
Administrator;2)City staff;3)legal counsel,engineers,accountants,financial advisors,and
other consultants engaged by the City;4)calculating,collecting,and maintaining records with
respect to Assessments and Annual Installments;5)preparing and maintaining records with
respect to Assessment Rolls and Annual Service Plan Updates;6)paying and redeeming PID
Bonds;7)investing or depositing Assessments and Annual Installments;8)complying with this
Service and Assessment Plan,the PID Act,and any Indenture,with respect to the PID Bonds,
including the City’s continuing disclosure requirements;and 9)the paying agent/registrar and
Trustee in connection with PID Bonds,including their respective legal counsel.Annual Collection
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
4
Costs collected but not expended in any year shall be carried forward and applied to reduce
Annual Collection Costs for subsequent years.
Annual Installment”means the annual installment payment of an Assessment as calculated by
the Administrator and approved by the City Council,that includes:1)principal;2)interest;3)
Annual Collection Costs;and 4)Additional Interest related to the PID Bonds,if applicable.
Annual Service Plan Update”means an update to this Service and Assessment Plan prepared
no less frequently than annually by the Administrator and approved by the City Council.
Apportioned Property”means any Parcel within the District against which the costs of the
Authorized Improvements are apportioned based on special conferred benefit and against which
an Assessment is anticipated to be levied,but not yet levied.
Apportionment of Costs”means an amount allocated by this Service and Assessment Plan to a
Parcel within the District for future Authorized Improvement costs,other than Non Benefitted
Property,subject to a future levy of Assessments by the City and also subject to reallocation upon
the subdivision of such Parcel or reduction according to the provisions herein and in the PID Act.
Assessed Property”means any Parcel within the District against which an Assessment is levied.
Assessment”means an assessment levied against Assessed Property,other than Non
Benefitted Property to pay the costs of certain Authorized Improvements as specified herein,
which Assessment is imposed pursuant to an Assessment Ordinance and the provisions herein,
as shown on an Assessment Roll,subject to reallocation upon the subdivision of such Assessed
Property or reduction according to the provisions herein and in the PID Act.
Assessment Ordinance”means an ordinance adopted by the City Council in accordance with
the PID Act that levies an Assessment on the Assessed Property,as shown on any Assessment
Roll.
Assessment Plan”means the methodology employed to assess the Actual Costs of the
Authorized Improvements against the Assessed Property based on the special benefits conferred
on such property by the Authorized Improvements,more specifically set forth and described in
Section V.
Assessment Roll”means any assessment roll for the Assessed Property,including the
Improvement Area 1 Assessment Roll,as updated,modified or amended from time to time in
accordance with the procedures set forth herein and in the PID Act,including updates prepared
in connection with the issuance of PID Bonds,if issued,or in any Annual Service Plan Updates.
The Improvement Area 1 Assessment Roll is included in this Service and Assessment Plan as
Exhibit F 1.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
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Authorized Improvements”means the improvements authorized by Section 372.003 of the PID
Act,and described in Section III,as further depicted on Exhibits G 1 and Exhibit G 2.
Bond Issuance Costs”means the costs associated with issuing PID Bonds,including,but not
limited to,attorney fees,financial advisory fees,consultant fees,appraisal fees,printing costs,
publication costs,capitalized interest,reserve fund requirements,underwriter’s discount,fees
charged by the Texas Attorney General,and any other cost or expense incurred by the City
directly associated with the issuance of any series of PID Bonds.
City”means the City of Anna,Texas.
City Council”means the governing body of the City.
County”means Collin County,Texas.
Delinquent Collection Costs”mean costs related to the foreclosure on Assessed Property and
the costs of collection of delinquent Assessments,delinquent Annual Installments,or any other
delinquent amounts due under this Service and Assessment Plan,including penalties and
reasonable attorney’s fees actually paid,but excluding amounts representing interest and
penalty interest.
Developer”means Bloomfield Homes,L.P.and any successors or assigns thereof that intends
to develop the property in the District for the ultimate purpose of transferring title to end users.
District”means Crystal Park Public Improvement District No.2 containing approximately
274.396 acres located within the corporate limits of the City,and more specifically described in
Exhibit J 1 and depicted on Exhibit A 1.
Engineer’s Report”means the report provided by a licensed professional engineer that
describes the Authorized Improvements,including their costs,location,and benefit,and is
attached hereto as Appendix A.
Estimated Buildout Value”means the estimated value of an Assessed Property or Apportioned
Property,as applicable,with fully constructed buildings,as provided by the Developer and
confirmed by the City Council,by considering such factors as density,lot size,proximity to
amenities,view premiums,location,market conditions,historical sales,builder contracts,
discussions with homebuilders,reports from third party consultants,or any other factors that,in
the judgment of the City,may impact value.The Estimated Buildout Value for each Lot Type is
shown on Exhibit E.
Improvement Area 1”means approximately 47.859 acres located within the District,more
specifically described in Exhibit J 2 and depicted on Exhibit A 2.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
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Improvement Area 1 Annual Installment”means the Annual Installment of the Improvement
Area 1 Assessment as calculated by the Administrator and approved by the City Council,that
includes:1)principal;2)interest;3)Annual Collection Costs related to Improvement Area 1;
and 4)Additional Interest related to the Improvement Area 1 Bonds,if applicable,as shown on
Exhibit F 2.
Improvement Area 1 Assessed Property”means any Parcel within Improvement Area 1
against which an Improvement Area 1 Assessment is levied.
Improvement Area 1 Assessment”means an Assessment to be levied against Improvement
Area 1 Assessed Property to pay for the Improvement Area 1 Authorized Improvements,and
imposed pursuant to an Assessment Ordinance and the provisions herein,as shown on the
Improvement Area 1 Assessment Roll,subject to reallocation or reduction pursuant to the
provisions set forth in Section VI herein and in the PID Act.
Improvement Area 1 Assessment Roll”means the Assessment Roll for the Improvement Area
1 Assessed Property,as updated,modified,or amended from time to time in accordance with
the procedures set forth herein and in the PID Act,including any updates prepared in connection
with the issuance of PID Bonds or any Annual Service Plan Updates.The Improvement Area 1
Assessment Roll is included in this Service and Assessment Plan as Exhibit F 1.
Improvement Area 1 Authorized Improvements”means collectively,1)the Improvement
Area 1 Projects;2)the first year’s Annual Collection Costs related to the Improvement Area 1
Bonds;and 3)Bond Issuance Costs incurred in connection with the issuance of Improvement
Area 1 Bonds.
Improvement Area 1 Bonds”means those certain City of Anna,Texas,Special Assessment
Revenue Bonds,Series 2025 Crystal Park Public Improvement District No.2 Improvement Area
1 Project)”that shall be secured by Improvement Area 1 Assessments.
Improvement Area 1 Improvements”means the Authorized Improvements which only benefit
the Improvement Area 1 Assessed Property,as further described in Section III.B and depicted
on Exhibit G 2.
Improvement Area 1 Initial Parcel”means all of the Improvement Area 1 Assessed Property
against which the entire Improvement Area 1 Assessment is levied,as shown on the
Improvement Area 1 Assessment Roll as shown on Exhibit F 1.
Improvement Area 1 Projects”means collectively,1)the pro rata portion of the Major
Improvements allocable to Improvement Area 1;and 2)the Improvement Area 1
Improvements.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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Indenture”means an Indenture of Trust entered into between the City and the Trustee in
connection with the issuance of each series of PID Bonds,as amended from time to time,setting
forth the terms and conditions related to a series of PID Bonds.
Lot”means 1)for any portion of the District for which a final subdivision plat has been recorded
in the Plat or Official Public Records of the County,a tract of land described by lot”in such
subdivision plat;and 2)for any portion of the District for which a subdivision plat has not been
recorded in the Plat or Official Public Records of the County,a tract of land anticipated to be
described as a lot”in a final recorded subdivision plat as shown on a concept plan or a
preliminary plat.A Lot”shall not include real property owned by a government entity,even if
such property is designated as a separate described tract or lot on a recorded subdivision plat.
Lot Type”means a classification of final building Lots with similar characteristics e.g.lot size,
home product,Estimated Buildout Value,etc.),as determined at the time of levying the
applicable Assessment and confirmed by the City Council.In the case of single family residential
Lots,the Lot Type shall be further defined by classifying the residential Lots by the Estimated
Buildout Value of the Lot as provided by the Developer,and confirmed by the City Council,as
shown on Exhibit E.
Lot Type 1”means a Lot Type within Improvement Area 1 marketed to homebuilders as a 50’
Lot.The buyer disclosure for Lot Type 1 is attached in Appendix B.
Lot Type 2”means a Lot Type within Improvement Area 1 marketed to homebuilders as a 60’
Lot.The buyer disclosure for Lot Type 2 is attached in Appendix B.
Major Improvements”means those Authorized Improvements that confer a special benefit to
all of the Assessed Property and Apportioned Property within the District,as further described in
Section III.A and depicted on Exhibit G 1.
Maximum Assessment”means,for each Lot,an Assessment equal to the lesser of 1)the
amount calculated pursuant to Section VI.A,or 2)for each Lot Type,the amount shown on
Exhibit E.
Non Benefitted Property”means Parcels within the boundaries of the District that accrue no
special benefit from the Authorized Improvements as determined by the City Council.
Non Assessed Property”means Parcels within the boundaries of the District that accrue special
benefit from the Authorized Improvements as determined by the City Council but are not
assessed.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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Notice of Assessment Termination”means a document that shall be recorded in the Official
Public Records of the County evidencing the termination of an Assessment,a form of which is
attached as Exhibit H.
Parcel”or Parcels”means a specific property within the District identified by either a tax parcel
identification number assigned by the Collin Central Appraisal District for real property tax
purposes,by legal description,or by lot and block number in a final subdivision plat recorded in
the Official Public Records of the County,or by any other means determined by the City.
PID Act”means Chapter 372,Texas Local Government Code,as amended.
PID Bonds”means any bonds issued by the City in one or more series and secured in whole or
in part by Assessments.
Prepayment”means the payment of all or a portion of an Assessment before the due date of
the final Annual Installment thereof.Amounts received at the time of a Prepayment which
represent a payment of principal,interest,or penalties on a delinquent installment of an
Assessment are not to be considered a Prepayment,but rather are to be treated as the payment
of the regularly scheduled Annual Installment.
Prepayment Costs”means interest,including Additional Interest and Annual Collection Costs,
to the date of Prepayment.
Private Improvements”means those certain improvements benefitting the District constructed
and paid for by the Developer and are not reimbursable from Assessments or PID Bonds,as
further described on Exhibit B 1.
Remainder Area”means approximately 226.537 acres located within the District and entirely
outside of Improvement Area 1,to be developed as one or more future improvement areas.
Remainder Area Apportioned Property”means any Parcel within the Remainder Area against
which a portion of the Actual Costs of the Major Improvements are apportioned based on special
conferred benefit,and against which an Assessment is expected to be levied,but not yet levied.
Remainder Area Apportionment of Costs”means an Apportionment of Costs against a Parcel
within the Remainder Area for the Remainder Area Projects,as shown on Exhibit B 2,subject to
reallocation upon the subdivision of such Parcel or reduction according to the provisions herein
and in the PID Act.
Remainder Area Projects”means the pro rata portion of the Major Improvements allocable to
the Remainder Area based on Estimated Buildout Value.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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Service and Assessment Plan”means this Crystal Park Public Improvement District No.2 Service
and Assessment Plan as updated,amended,or supplemented from time to time.
Service Plan”means the plan described in Section IV which covers a period of at least five years
and defines the annual indebtedness and projected costs of the Authorized Improvements.
Trustee”means the trustee or successor trustee under an Indenture.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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SECTION II:THE DISTRICT
The District includes approximately 274.396 contiguous acres within the corporate limits of the
City,the boundaries of which are more particularly described on Exhibit J 1 and depicted on
Exhibit A 1.Development of the District is anticipated to include approximately 946 Lots
developed with single family homes.
Improvement Area 1 includes approximately 47.859 contiguous acres located within the
corporate limits of the City,the boundaries of which are more particularly described on Exhibit
J 2 and depicted on Exhibit A 2.Development of Improvement Area 1 is anticipated to include
approximately 171 Lots developed with single family homes,including 123 single family homes
that are on Lots classified as Lot Type 1,and 48 single family homes that are on Lots classified as
Lot Type 2.
SECTION III:AUTHORIZED IMPROVEMENTS
Based on information provided by the Developer and its engineers and reviewed by the City staff
and by third party consultants retained by the City,the City has determined that the Authorized
Improvements confer a special benefit on the Assessed Property and the Apportioned Property.
Authorized Improvements will be designed and constructed in accordance with the City’s
standards and specifications and will be owned and operated by the City.The budget for the
Authorized Improvements is shown on Exhibit B 1.The Apportionment of Costs of the Major
Improvements is shown on Exhibit B 2.
A. Major Improvements
Paving/Roads/Streets
Improvements including subgrade stabilization,reinforced concrete for roadways,
headers,barricades,signs,striping,and traffic control.All related earthwork,excavation,
clearing grubbing,erosion control,intersections,signage,lighting,and re vegetation of
all disturbed areas within the right of way are included.The road improvements will
provide benefit to each Lot within the District.
Water
Improvements including trench excavation and embedment,trench safety,PVC piping,
water main connections,water meters,testing,related earthwork,excavation,erosion
control,fire hydrants,platting,staking,and all necessary appurtenances required to
provide water service to all Lots within the District.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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Sanitary Sewer
Improvements including trench excavation and embedment,trench safety,PVC piping,
encasement,manholes,sewer main connections,service connections,testing,related
earthwork,excavation,erosion control,platting,staking,and all necessary appurtenances
required to provide wastewater service to all Lots within the District.
Storm Drainage
Improvements including trench excavation and embedment,RCP piping,curb and drop
inlets,headwalls,wingwalls,manholes,rock rip rap,and trench safety as well as all related
earthwork,excavation,erosion control,platting,staking,and all necessary appurtenances
required to provide storm drainage for all Lots within the District.
So Costs
Costs related to designing,constructing,and installing the Major Improvements including
inspection fees,City fees,bonds,engineering,soil testing,survey,construction
management,contingency,legal fees,and consultants.
B. Improvement Area 1 Improvements
Paving/Roads/Streets
Improvements including subgrade stabilization,reinforced concrete for roadways,
handicapped ramps,sidewalks,pavement connections,headers,barricades,CBU pads,
signs,platting,staking,and streetlights.All related earthwork,excavation,clearing
grubbing,tree removal,erosion control,intersections,signage,lighting,screening walls,
and re vegetation of all disturbed areas within the right of way are included.The road
improvements will provide benefit to each Lot within Improvement Area 1.
Water
Improvements including trench excavation and embedment,trench safety,PVC piping,
water main connections,water meters,service connections,testing,related earthwork,
excavation,erosion control,fire hydrants,platting,staking,and all necessary
appurtenances required to provide water service to all Lots within Improvement Area 1.
Sanitary Sewer
Improvements including trench excavation and embedment,trench safety,PVC piping,
encasement,boring,manholes,sewer main connections,service connections,testing,
related earthwork,excavation,erosion control,platting,staking,and all necessary
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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appurtenances required to provide wastewater service to all Lots within Improvement
Area 1.
Storm Drainage
Improvements including trench excavation and embedment,curb and drop inlets,RCP
RCB piping and boxes,headwalls,manholes,rock rip rap,concrete outfalls,storm drain
connections,trench safety,and testing as well as all related earthwork,excavation,
erosion control,encasement,platting,staking,and all necessary appurtenances required
to provide storm drainage for all Lots within Improvement Area 1.
So Costs
Costs related to designing,constructing,and installing the Improvement Area 1
Improvements including land planning and design,erosion control,inspection fees,City
fees,bonds,engineering,soil testing,survey,construction management,contingency,
legal fees,and consultants.
C. Bond Issuance Costs
Debt Service Reserve Fund
Equals the amount to be deposited in a debt service reserve fund under an applicable
Indenture in connection with the issuance of PID Bonds.
Capitalized Interest
Equals the amount required to be deposited for the purpose of paying capitalized interest
on a series of PID Bonds under an applicable Indenture in connection with the issuance of
such PID Bonds.
Underwriter’s Discount
Equals a percentage of the par amount of a particular series of PID Bonds related to the
costs of underwriting such PID Bonds,including the fee of counsel to the Underwriter.
Cost of Issuance
Includes costs of issuing a particular series of PID Bonds,including but not limited to City
fees,attorney’s fees,financial advisory fees,consultant fees,initial trustee fees,appraisal
fees,printing costs,publication costs,City’s costs,fees charged by the Texas Attorney
General,and any other cost or expense directly associated with the issuance of PID Bonds.
D. Other Costs
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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Deposit to Administrative Fund
Equals the amount necessary to fund the first year’s Annual Collection Costs for a
particular series of PID Bonds.
SECTION IV:SERVICE PLAN
The PID Act requires the Service Plan to cover a period of at least five years.The Service Plan is
required to define the annual projected costs and indebtedness for the Authorized
Improvements undertaken within the District during the five year period.The Service Plan is also
required to include a copy of the buyer disclosure notice form required by Section 5.014 of the
Texas Property Code,as amended.The Service Plan must be reviewed and updated in each
Annual Service Plan Update.Exhibit C summarizes the initial Service Plan for the Improvement
Area 1.Per the PID Act and Section 5.014 of the Texas Property Code,as amended,this Service
and Assessment Plan,and any future Annual Service Plan Updates,shall include a form of the
buyer disclosure for the District.The buyer disclosures are attached hereto as Appendix B.
Exhibit D summarizes the sources and uses of funds required to construct the Authorized
Improvements and Private Improvements.The sources and uses of funds shown on Exhibit D
shall be updated in an Annual Service Plan Update.
SECTION V:ASSESSMENT PLAN
The PID Act allows the City Council to apportion the costs of the Authorized Improvements to the
Assessed Property and Apportioned Property based on the special benefit received from the
Authorized Improvements.The PID Act provides that such costs may be apportioned:1)equally
per front foot or square foot;2)according to the value of property as determined by the City
Council,with or without regard to improvements constructed on the property;or 3)in any other
manner approved by the City Council that results in imposing equal shares of such costs on
property similarly benefited.The PID Act further provides that the City Council may establish by
ordinance or order reasonable classifications and formulas for the apportionment of the cost
between the City and the area to be assessed and the methods of assessing the special benefits
for various classes of improvements.
This section of this Service and Assessment Plan describes the special benefit received by each
Parcel within the District as a result of the Authorized Improvements and provides the basis and
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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justification for the determination that this special benefit equals or exceeds the amount of the
Assessments to be levied on the Assessed Property for such Authorized Improvements.
The determination by the City Council of the assessment methodologies set forth below is the
result of the discretionary exercise by the City Council of its legislative authority and
governmental powers and is conclusive and binding on the Developer,and all future owners and
developers of the Assessed Property and Apportioned Property.
A. Assessment Methodology
Acting in its legislative capacity and based on information provided by the Developer and its
engineer and reviewed by the City staff and by third party consultants retained by the City,the
City Council has determined that the costs related to the Authorized Improvements shall be
allocated as follows:
The costs of the Major Improvements shall be allocated to Improvement Area 1 and
apportioned to the Remainder Area based upon Estimated Buildout Value of each Parcel
or Assessed Property to the Estimated Buildout Value of the District.Currently,the
Remainder Area is allocated 83.87%of the Major Improvements costs,and Improvement
Area 1 is allocated 16.13%of the Major Improvements costs.The Remainder Area and
Improvement Area 1’s shares of the Major Improvements are illustrated in Exhibit B 2.
By the adoption of this Service and Assessment Plan,the costs of the Improvement Area
1 Authorized Improvements are allocated to each Parcel within Improvement Area 1
based on the ratio of the Estimated Buildout Value of each Parcel designated as
Improvement Area 1 Assessed Property to the Estimated Buildout Value of all
Improvement Area 1 Assessed Property.The Improvement Area 1 Initial Parcel is the
only Parcel within Improvement Area 1,and as such,the Improvement Area 1 Initial
Parcel is allocated 100%of the Improvement Area 1 Authorized Improvements.
B. Assessments
By the adoption of this Service and Assessment Plan,the Improvement Area 1 Assessment shall
be levied on the Improvement Area 1 Initial Parcel in the amount shown on the Improvement
Area 1 Assessment Roll,attached hereto as Exhibit F 1.The projected Improvement Area 1
Annual Installments are shown on Exhibit F 2.Upon division or subdivision of the Improvement
Area 1 Initial Parcel,the Improvement Area 1 Assessment will be reallocated pursuant to
Section VI.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
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The Maximum Assessment for each Lot Type is shown on Exhibit E.In no case will the Assessment
for Lots classified as Lot Type 1 and Lot Type 2,respectively,exceed the corresponding Maximum
Assessment for each Lot Type classification.
C. Findings of Special Benefit
Acting in its legislative capacity and based on information provided by the Developer and its
engineers and reviewed by the City staff and by third party consultants retained by the City,the
City Council has found and determined the following:
Improvement Area 1
The costs of the Improvement Area 1 Authorized Improvements equal
11,495,192 as shown on Exhibit B 1;and
The Improvement Area 1 Assessed Property receives special benefit from the
Improvement Area 1 Authorized Improvements equal to or greater than the
Actual Cost of the Improvement Area 1 Authorized Improvements;and
By the adoption of this Service and Assessment Plan,the Improvement Area 1
Initial Parcel is allocated 100%of the Improvement Area 1 Assessment levied for
the Improvement Area 1 Authorized Improvements,which equals 7,456,000 as
shown on the Improvement Area 1 Assessment Roll attached hereto as Exhibit
F 1;and
The special benefit 11,495,192)received by the Improvement Area 1 Initial
Parcel from the Improvement Area 1 Authorized Improvements is equal to or
greater than the amount of the Improvement Area 1 Assessment 7,456,000)
levied on the Improvement Area 1 Initial Parcel for the Improvement Area 1
Authorized Improvements;and
At the time the City Council adopted this Service and Assessment Plan,the
Developer owned 100%of the Improvement Area 1 Initial Parcel.The Developer
acknowledges that the Improvement Area 1 Authorized Improvements confer a
special benefit on the Improvement Area 1 Initial Parcel and consents to the
imposition of the Improvement Area 1 Assessment to pay for the Actual Costs
associated therewith.The Developer ratified,confirmed,accepted,agreed to,and
approved:1)the determinations and findings by the City Council as to the special
benefits described herein and the applicable Assessment Ordinance;2)the
Service and Assessment Plan and the applicable Assessment Ordinance;and 3)
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
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the levying of the Improvement Area 1 Assessment on the Improvement Area 1
Initial Parcel.
Remainder Area
The costs of the Major Improvements allocable to the Remainder Area equal
5,359,126 as shown on Exhibit B 1;and
The Remainder Area receives special benefit from the Remainder Area Projects
equal to or greater than the Actual Cost of the Remainder Area Projects allocable
to the Remainder Area Apportioned Property;and
By the approval of this Service and Assessment Plan by the City Council,the
Remainder Area Apportioned Property is apportioned 83.87%of the Major
Improvements,which equals 5,359,126 as shown on Exhibit B 2,of which all or
a portion is anticipated to be reimbursed by Assessments levied at a later date;
and
At the time the City Council approved this Service and Assessment Plan,the
Developer owned 100%of the Remainder Area.The Developer acknowledges that
the Major Improvements confer a special benefit on the Remainder Area and
consents to the apportionment of the Remainder Area Apportionment of Costs in
anticipation of a future levy of Assessments by the City Council to pay for all or a
portion of the Remainder Area Apportionment of Costs associated therewith.The
Developer ratified,confirmed,accepted,agreed to,and approved:1)the
determinations and findings by the City Council as to the special benefits
described herein;2)this Service and Assessment Plan;and 3)the Apportionment
of Costs on the Remainder Area Apportioned Property.
D. Annual Collection Costs
The Annual Collection Costs shall be paid for annually by the owner of each Parcel pro rata based
on the ratio of the amount of outstanding Assessment remaining on the Parcel to the total
outstanding Assessment.The Annual Collection Costs shall be collected as part of and in the
same manner as Annual Installments in the amounts shown on the Assessment Roll,which may
be revised based on Actual Costs incurred in Annual Service Plan Updates.
E. Additional Interest
The interest rate on Assessments securing each respective series of PID Bonds may exceed the
interest rate on each respective series of PID Bonds by the Additional Interest Rate.To the extent
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
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required by any Indenture,Additional Interest shall be collected as part of each Annual
Installment and shall be deposited pursuant to the applicable Indenture.
SECTION VI:TERMS OF THE ASSESSMENTS
Any reallocation of Assessments as described in this Section VI shall be considered an
administrative action of the City and will not be subject to the notice or public hearing
requirements under the PID Act.
A. Reallocation of Assessments
1. Upon Division Prior to Recording of Subdivision Plat
Upon the division of any Assessed Property without the recording of a subdivision plat),
the Administrator shall reallocate the Assessment for the Assessed Property prior to the
division among the newly divided Assessed Properties according to the following formula:
A B x C D)Where
the terms have the following meanings:A
the Assessment for the newly divided Assessed Property B
the Assessment for the Assessed Property prior to division C
the Estimated Buildout Value of the newly divided Assessed Property D
the sum of the Estimated Buildout Value for all of the newly divided Assessed Properties
The
calculation of the Assessment of an Assessed Property shall be performed by the Administrator
and shall be based on the Estimated Buildout Value of that Assessed Property,
as provided by the Developer,relying on information from homebuilders,market
studies,appraisals,Official Public Records of the County,and any other relevant information
regarding the Assessed Property.The Estimated Buildout Values for Lot Type 1
and Lot Type 2 are shown on Exhibit E and will not change in future Annual Service Plan Updates,
but Exhibit E may be updated in future Annual Service Plan Updates to account for
additional Lot Types.The calculation as confirmed by the City Council shall be conclusive
and binding.The
sum of the Assessments for all newly divided Assessed Properties shall equal the Assessment
for the Assessed Property prior to subdivision.The calculation shall be made separately
for each newly divided Assessed Property.The reallocation of an Assessment for
an Assessed Property that is a homestead under Texas law may not exceed the
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
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Assessment prior to the reallocation.Any reallocation pursuant to this section shall be
reflected in the Annual Service Plan Update immediately following such reallocation.
2. Upon Subdivision by a Recorded Subdivision Plat
Upon the subdivision of any Assessed Property based on a recorded subdivision plat,the
Administrator shall reallocate the Assessment for the Assessed Property prior to the
subdivision among the new subdivided Lots based on Estimated Buildout Value according
to the following formula:
A B x C D)]/E Where
the terms have the following meanings:A
the Assessment for the newly subdivided Lot B
the Assessment for the Parcel prior to subdivision C
the sum of the Estimated Buildout Value of all newly subdivided Lots with the same
Lot Type D
the sum of the Estimated Buildout Value for all of the newly subdivided Lots excluding
Non Benefitted Property E=
the number of newly subdivided Lots with the same Lot Type Prior
to the recording of a subdivision plat,the Developer shall provide the City an Estimated
Buildout Value as of the date of the recorded subdivision plat for each Lot created
by the recorded subdivision plat.The calculation of the Assessment for a Lot shall be
performed by the Administrator and confirmed by the City Council based on Estimated Buildout
Value information provided by the Developer,homebuilders,third party consultants,
and/or the Official Public Records of the County regarding the Lot.The Estimated
Buildout Values for Lot Type 1 and Lot Type 2 are shown on Exhibit E and will not
change in future Annual Service Plan Updates.The calculation as confirmed by the City
Council shall be conclusive and binding.The
sum of the Assessments for all newly subdivided Lots shall not exceed the Assessment for
the portion of the Assessed Property subdivided prior to subdivision.The calculation shall
be made separately for each newly subdivided Assessed Property.The reallocation of
an Assessment for an Assessed Property that is a homestead under Texas law may not exceed
the Assessment prior to the reallocation.Any reallocation pursuant to this section shall
be reflected in the Annual Service Plan Update immediately following such reallocation.
3.
Upon Consolidation
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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If two or more Lots or Parcels are consolidated into a single Lot or Parcel,the
Administrator shall allocate the Assessments against the Lots or Parcels before the
consolidation to the consolidated Lot or Parcel,which allocation shall be approved by the
City Council in the next Annual Service Plan Update immediately following such
consolidation.The Assessment for any resulting Lot may not exceed the Maximum
Assessment for the applicable Lot Type and compliance may require a mandatory
Prepayment of Assessments pursuant to Section VI.C.
B. Mandatory Prepayment of Assessments
If an Assessed Property or a portion thereof is conveyed to a party that is exempt from payment
of the Assessment under applicable law,or the owner causes a Lot,Parcel or portion thereof to
become Non Benefitted Property,the owner of such Lot,Parcel or portion thereof shall pay to
the City,or cause to be paid to the City,the full amount of the Assessment,plus all Prepayment
Costs and Delinquent Collection Costs for such Assessed Property,prior to any such conveyance
or act,and no such conveyance shall be effective until the City receives such payment.Following
payment of the foregoing costs in full,the City shall provide the owner with a recordable Notice
of Assessment Termination,”a form of which is attached hereto as Exhibit H.
C. True Up of Assessments if Maximum Assessment Exceeded at Plat
Prior to the City approving a final subdivision plat,the Administrator will certify that such plat
will not result in the Assessment per Lot for any Lot Type to exceed the Maximum Assessment.If
the Administrator determines that the resulting Assessment per Lot for any Lot Type will exceed
the Maximum Assessment for that Lot Type,then 1)the Assessment applicable to each Lot Type
shall each be reduced to the Maximum Assessment,and 2)the person or entity filing the plat
shall pay to the City,or cause to be paid to the City,the amount the Assessment was reduced,
plus Prepayment Costs and Delinquent Collection Costs,if any,prior to the City approving the
final plat.The City’s approval of a plat without payment of such amounts does not eliminate the
obligation of the person or entity filing the plat to pay such amounts.At no time shall the
aggregate Assessments for any Lot exceed the Maximum Assessment.
D. Reduction of Assessments
If as a result of cost savings or the failure to construct all or a portion of an Authorized
Improvement the Actual Costs of any Authorized Improvements are less than the Assessments,
then i)in the event PID Bonds have not been issued for the purpose of financing Authorized
Improvements affected by such reduction in Actual Costs,the City Council shall reduce each
Assessment on a pro rata basis such that the sum of the resulting reduced Assessments for all
Assessed Property equals the reduced Actual Costs that were expended,or ii)in the event that
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
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PID Bonds have been issued for the purpose of financing Authorized Improvements affected by
such reduction in Actual Costs,the Trustee shall apply amounts on deposit in the applicable
account of the project fund created under the Indenture relating to such series of PID Bonds that
are not expected to be used for the purposes of the project fund as directed by the City pursuant
to the terms of such Indenture.Such excess PID Bond proceeds may be used for any purpose
authorized by such Indenture.The Assessments shall never be reduced to an amount less than
the amount required to pay all outstanding debt service requirements on all outstanding PID
Bonds.
The Administrator shall update and submit to the City Council for review and approval as part of
the next Annual Service Plan Update)the Assessment Roll and corresponding Annual Installments
to reflect the reduced Assessments.
E. Prepayment of Assessments
The owner of any Assessed Property may,at any time,pay all or any part of an Assessment in
accordance with the PID Act.Prepayment Costs,if any,may be paid from a reserve established
under the applicable Indenture.If an Annual Installment has been billed,or the Annual Service
Plan Update has been approved by the City Council prior to the Prepayment,the Annual
Installment shall be due and payable and shall be credited against the Prepayment.
If an Assessment on an Assessed Property is prepaid in full,with Prepayment Costs,1)the
Administrator shall cause the Assessment to be reduced to zero on said Assessed Property and
the Assessment Roll to be revised accordingly;2)the Administrator shall prepare the revised
Assessment Roll and submit such revised Assessment Roll to the City Council for review and
approval as part of the next Annual Service Plan Update;3)the obligation to pay the Assessment
and corresponding Annual Installments shall terminate with respect to said Assessed Property;
and 4)the City shall provide the owner with a recordable Notice of Assessment Termination.”
If an Assessment on an Assessed Property is prepaid in part with Prepayment Costs:1)the
Administrator shall cause the Assessment to be reduced on said Assessed Property and the
Assessment Roll revised accordingly;2)the Administrator shall prepare the revised Assessment
Roll and submit such revised Assessment Roll to the City Council for review and approval as part
of the next Annual Service Plan Update;and 3)the obligation to pay the Assessment will be
reduced to the extent of the Prepayment made.
F. Payment of Assessment in Annual Installments
Assessments that are not paid in full shall be due and payable in Annual Installments.Exhibit F 2
shows the estimated Improvement Area 1 Annual Installments.Annual Installments are subject
to adjustment in each Annual Service Plan Update.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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Prior to the recording of a final subdivision plat,if any Parcel shown on the Assessment Roll is
assigned multiple tax parcel identification numbers for billing and collection purposes,the Annual
Installment shall be allocated pro rata based on the acreage of the Parcel not including any Non
Benefitted Property or Non Assessed Property,as shown by the Collin Central Appraisal District
for each tax parcel identification number.
The Administrator shall prepare and submit to the City Council for its review and approval an
Annual Service Plan Update to allow for the billing and collection of Annual Installments.Each
Annual Service Plan Update shall include updated Assessment Rolls and updated calculations of
Annual Installments.The Annual Collection Costs for a given Assessment shall be paid by the
owner of each Parcel pro rata based on the ratio of the amount of outstanding Assessment
remaining on the Parcel to the total outstanding Assessment.Annual Installments shall be
reduced by any credits applied under an applicable Indenture,such as capitalized interest,
interest earnings on account balances,and any other funds available to the Trustee for such
purposes.Annual Installments shall be collected by the City in the same manner and at the same
time as ad valorem taxes.Annual Installments shall be subject to the penalties,procedures,and
foreclosure sale in case of delinquencies as set forth in the PID Act and in the same manner as ad
valorem taxes due and owing to the City.To the extent permitted by the PID Act or other
applicable law,the City Council may provide for other means of collecting Annual Installments,
but in no case shall the City take any action,or fail to take any action,that would cause it to be
in default under any Indenture.Assessments shall have the lien priority specified in the PID Act.
Sales of the Assessed Property for nonpayment of Annual Installments shall be subject to the lien
for the remaining unpaid Annual Installments against the Assessed Property,and the Assessed
Property may again be sold at a judicial foreclosure sale if the purchaser fails to timely pay any of
the remaining unpaid Annual Installments as they become due and payable.
The City reserves the right to refund PID Bonds in accordance with applicable law,including the
PID Act.In the event of a refunding,the Administrator shall recalculate the Annual Installments
so that total Annual Installments will be sufficient to pay the refunding bonds,and the refunding
bonds shall constitute PID Bonds.”
Each Annual Installment of an Assessment,including interest on the unpaid principal of the
Assessment,shall be updated annually.Each Annual Installment shall be due when billed and
shall be delinquent if not paid prior to February 1 of the following year.
Failure of an owner of an Assessed Property to receive an invoice for an Annual Installment shall
not relieve said owner of the responsibility for payment of the Assessment.Assessments,or
Annual Installments thereof,that are delinquent shall incur Delinquent Collection Costs.
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G. Prepayment as a Result of an Eminent Domain Proceeding or Taking
Subject to applicable law,if any portion of any Parcel of Assessed Property is taken from an owner
as a result of eminent domain proceedings or if a transfer of any portion of any Parcel of Assessed
Property is made to an entity with the authority to condemn all or a portion of the Assessed
Property in lieu of or as a part of an eminent domain proceeding a Taking”),the portion of the
Assessed Property that was taken or transferred the Taken Property”)shall be reclassified as
Non Benefitted Property.
For the Assessed Property that is subject to the Taking as described in the preceding paragraph,
the Assessment that was levied against the Assessed Property when it was included in the Taken
Property)prior to the Taking shall remain in force against the remaining Assessed Property the
Assessed Property less the Taken Property)the Remaining Property”),following the
reclassification of the Taken Property as Non Benefitted Property,subject to an adjustment of
the Assessment applicable to the Remaining Property after any required Prepayment as set forth
below.The owner of the Remaining Property will remain liable to pay,pursuant to the terms of
this Service and Assessment Plan,as updated,and the PID Act,the Assessment that remains due
on the Remaining Property,subject to an adjustment in the Assessment applicable to the
Remaining Property after any required Prepayment as set forth below.Notwithstanding the
foregoing,if the Assessment that remains due on the Remaining Property exceeds the applicable
Maximum Assessment,the owner of the Remaining Property will be required to make a
Prepayment in an amount necessary to ensure that the Assessment against the Remaining
Property does not exceed such Maximum Assessment,in which case the Assessment applicable
to the Remaining Property will be reduced by the amount of the partial Prepayment.If the City
receives all or a portion of the eminent domain proceeds or payment made in an agreed sale in
lieu of condemnation),such amount shall be credited against the amount of Prepayment,with
any remainder credited against the Assessment on the Remaining Property.
In all instances the Assessment remaining on the Remaining Property shall not exceed the
applicable Maximum Assessment.
By way of illustration,if an owner owns 100 acres of Assessed Property subject to a 100
Assessment and 10 acres is taken through a Taking,the 10 acres of Taken Property shall be
reclassified as Non Benefitted Property and the remaining 90 acres constituting the Remaining
Property shall be subject to the 100 Assessment provided that this 100 Assessment does not
exceed the Maximum Assessment on the Remaining Property).If the Administrator determines
that the 100 Assessment reallocated to the Remaining Property would exceed the Maximum
Assessment,as applicable,on the Remaining Property by 10,then the owner shall be required
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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to pay 10 as a Prepayment of the Assessment against the Remaining Property and the
Assessment on the Remaining Property shall be adjusted to 90.
Notwithstanding the previous paragraphs in this subsection,if the owner of the Remaining
Property notifies the City and the Administrator that the Taking prevents the Remaining Property
from being developed for any use which could support the Estimated Buildout Value
requirement,the owner shall,upon receipt of the compensation for the Taken Property,be
required to prepay the amount of the Assessment required to buy down the outstanding
Assessment to the applicable Maximum Assessment on the Remaining Property to support the
Estimated Buildout Value requirement.The owner will remain liable to pay the Assessment on
both the Taken Property and the Remaining Property until such time that such Assessment has
been prepaid in full.
Notwithstanding the previous paragraphs in this subsection,the Assessments shall never be
reduced to an amount less than the amount required to pay all outstanding debt service
requirements on all outstanding PID Bonds.
SECTION VII:ASSESSMENT ROLL
The Improvement Area 1 Assessment Roll is attached as Exhibit F 1.The Administrator shall
prepare and submit to the City Council for review and approval proposed revisions to the
Improvement Area 1 Assessment Roll and Improvement Area 1 Annual Installments for each
Parcel as part of each Annual Service Plan Update.
SECTION VIII:ADDITIONAL PROVISIONS
A. Calculation Errors
If the owner of a Parcel claims that an error has been made in any calculation required by this
Service and Assessment Plan,including,but not limited to,any calculation made as part of any
Annual Service Plan Update,the owner’s sole and exclusive remedy shall be to submit a written
notice of error to the Administrator by December 1st of each year following City Council’s
approval of the calculation.Otherwise,the owner shall be deemed to have unconditionally
approved and accepted the calculation.The Administrator shall provide a written response to
the City Council and the owner not later than 30 days after receipt of such written notice of error
by the Administrator.The City Council shall consider the owner’s notice of error and the
Administrator’s response at a public meeting,and,not later than 30 days after closing such
meeting,the City Council shall make a final determination as to whether an error has been made.
If the City Council determines that an error has been made,the City Council shall take such
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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corrective action as is authorized by the PID Act,this Service and Assessment Plan,the applicable
Assessment Ordinance,the applicable Indenture,or as otherwise authorized by the discretionary
power of the City Council.The determination by the City Council as to whether an error has been
made,and any corrective action taken by the City Council,shall be final and binding on the owner
and the Administrator.
B. Amendments
Amendments to this Service and Assessment Plan must be made by the City Council in
accordance with the PID Act.To the extent permitted by the PID Act,this Service and Assessment
Plan may be amended without notice to owners of the Assessed Property:1)to correct mistakes
and clerical errors;2)to clarify ambiguities;and 3)to provide procedures to collect
Assessments,Annual Installments,and other charges imposed by this Service and Assessment
Plan.
C. Administration and Interpretation
The Administrator shall:1)perform the obligations of the Administrator as set forth in this
Service and Assessment Plan;2)administer the District for and on behalf of and at the direction
of the City Council;and 3)interpret the provisions of this Service and Assessment Plan.
Interpretations of this Service and Assessment Plan by the Administrator shall be in writing and
shall be appealable to the City Council by owners of Assessed Property adversely affected by the
interpretation.Appeals shall be decided by the City Council after holding a public meeting at
which all interested parties have an opportunity to be heard.Decisions by the City Council shall
be final and binding on the owners of Assessed Property and developers and their successors and
assigns.
D. Form of Buyer Disclosure/Filing Requirements
Per Section 5.014 of the Texas Property Code,as amended,this Service and Assessment Plan,and
any future Annual Service Plan Updates,shall include a form of the buyer disclosures for the
District.The buyer disclosures are attached hereto as Appendix B.Within seven days of approval
by the City Council,the City shall file and record in the real property records of the County the
executed ordinance approving this Service and Assessment Plan,or any future Annual Service
Plan Updates.The executed ordinance,including any attachments,approving this Service an
Assessment Plan or any future Annual Service Plan Updates shall be filed and recorded in their
entirety.
E. Severability
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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If any provision of this Service and Assessment Plan is determined by a governmental agency or
court to be unenforceable,the unenforceable provision shall be deleted and,to the maximum
extent possible,shall be rewritten to be enforceable.Every effort shall be made to enforce the
remaining provisions.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBITS
The following Exhibits are attached to and made a part of this Service and Assessment Plan for
all purposes:
Exhibit A 1 Map of the District
Exhibit A 2 Map of Improvement Area 1
Exhibit A 3 Improvement Area 1 Lot Type Classification Map
Exhibit B 1 Project Costs
Exhibit B 2 Apportionment of Costs
Exhibit C Service Plan
Exhibit D Sources and Uses of Funds
Exhibit E Maximum Assessment and Tax Rate Equivalent
Exhibit F 1 Improvement Area 1 Assessment Roll
Exhibit F 2 Improvement Area 1 Annual Installments
Exhibit G 1 Maps of Major Improvements
Exhibit G 2 Maps of Improvement Area 1 Improvements
Exhibit H Form of Notice of Assessment Termination
Exhibit I Debt Service Schedule for Improvement Area 1 Bonds
Exhibit J 1 District Boundary Description
Exhibit J 2 Improvement Area 1 Boundary Description
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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APPENDICES
The following Appendices are attached to and made a part of this Service and Assessment Plan
for all purposes:
Appendix A Engineer’s Report
Appendix B Buyer Disclosures
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT A 1 MAP OF THE DISTRICT
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT A 2 MAP OF IMPROVEMENT AREA 1
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT A 3 IMPROVEMENT AREA 1 LOT TYPE CLASSIFICATION MAP
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT B 1 PROJECT COSTS
Cost % Cost
Major Improvements [b]
Paving/Roads/Streets 1,494,196$1,494,196$16.13% 240,982$83.87% 1,253,214$
Water 701,239 701,239 16.13% 113,095 83.87% 588,144
Sanitary Sewer 1,966,601 1,966,601 16.13% 317,171 83.87% 1,649,430
Drainage 501,400 501,400 16.13% 80,865 83.87% 420,534
Soft Costs 1,726,204 1,726,204 16.13% 278,400 83.87% 1,447,804
6,389,640$6,389,640$1,030,513$5,359,126$
Improvement Area 1 Improvements
Paving/Roads/Streets 3,185,946$3,185,946$100.00% 3,185,946$0.00%$
Water 1,048,203 1,048,203 100.00% 1,048,203 0.00%
Sanitary Sewer 1,037,400 1,037,400 100.00% 1,037,400 0.00%
Drainage 1,309,055 1,309,055 100.00% 1,309,055 0.00%
Soft Costs 2,150,076 2,150,076 100.00% 2,150,076 0.00%
8,730,679$8,730,679$8,730,679$
Private Improvements [d]
Private Improvements 2,864,044$2,864,044$0.00%$0.00%$
2,864,044$2,864,044$
Bond Issuance Costs [e]
Debt Service Reserve Fund 548,614$548,614$548,614$
Capitalized Interest 326,815 326,815 326,815
Underwriter Discount[f]223,680 223,680 223,680
Cost of Issuance 554,891 554,891 554,891
1,654,000$1,654,000$1,654,000$
Other Costs [e]
Deposit to Administrative Fund 80,000$80,000$80,000$
80,000$80,000$80,000$
Total 19,718,363$2,864,044$16,854,319$11,495,192$5,359,126$
Footnotes:
Improvement Area1Privately
Funded[c]
District Eligible
Costs
Remainder Area
a]Per Engineer's Report attached hereto as Appendix A.
b]The Major Improvements are allocated pro rata between Improvement Area 1 and the Remainder Area based on the ratio of Estimated Buildout Value of each area to the Estimated
Buildout Value of the District.
c]Not reimbursable to the Developer through Assessments or the issuance of PID Bonds.
d]Includes the cost of excavation,retaining walls,landscaping,screening,entryways,franchise fees,and soft costs necessary to reach final Lot completion.Does not include the cost of
the Amenity Center.
e]Preliminary estimates only and subject to change upon the issuance of PID Bonds.
f]Includes the fee of counsel to the Underwriter.
Total Costs[a]
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EXHIBIT B 2 ALLOCATION OF AUTHORIZED IMPROVEMENTS
Costs
Improvement Area 1 171 90,300,000.00$16.13% 1,030,513.43$
Remainder Area 775 469,600,000.00$83.87% 5,359,126.30$5,359,126.30$
Total 946 559,900,000.00$6,389,639.73$
Footnotes:
a]As provided by the Developer.
b]The costs of the Major Improvements apportioned pro rata based on Estimated Buildout Value between Improvement Area 1 and the
Remainder Area.
c]Reimbursable in part or in full from future Assessments levied on the Remainder Area
Improvement Area Units[
a]
Estimated Buildout
Value[a]
Major Improvements[b]Total Apportionment
for Future Funding[c]
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT C SERVICE PLAN
Annual Installment Due 1/31/2026 1/31/2027 1/31/2028 1/31/2029 1/31/2030
Principal $104,000.00$110,000.00$116,000.00$123,000.00$
Interest 326,815.12 440,649.60 434,503.20 428,002.20 421,146.60
Capitalized Interest (1) (326,815.12)
544,649.60$544,503.20$544,002.20$544,146.60$
Additional Interest (2)$37,280.00$36,760.00$36,210.00$35,630.00$
Annual Collection Costs (3)$40,800.00$41,616.00$42,448.32$43,297.29$
Total Annual Installment Due (4)1)2)3)$622,729.60$622,879.20$622,660.52$623,073.89$
Improvement Area 1
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT D SOURCES AND USES OF FUNDS
Privately Funded Improvement Area 1 Remainder Area Total
Improvement Area 1 Bonds $7,456,000$7,456,000$
Remainder Area Apportionment of Costs[a]5,359,126 5,359,126
Developer Contribution Improvement Area 1[b]4,039,192 4,039,192
Developer Contribution Private Improvements[b]2,864,044 2,864,044
Total Sources of Funds 2,864,044$11,495,192$5,359,126$19,718,363$
Major Improvements $1,030,513$5,359,126$6,389,640$
Improvement Area 1 Improvements 8,730,679 8,730,679
Private Improvements[b]2,864,044 2,864,044
2,864,044$9,761,192$5,359,126$17,984,363$
Bond Issuance Costs [c]
Debt Service Reserve Fund $548,614$548,614$
Capitalized Interest 326,815 326,815
Underwriter Discount[d]223,680 223,680
Cost of Issuance 554,891 554,891
1,654,000$1,654,000$
Other Costs [c]
Deposit to Administrative Fund $80,000$80,000$
80,000$80,000$
Total Uses of Funds 2,864,044$11,495,192$5,359,126$19,718,363$
Footnotes:
Uses of Funds
Sources of Funds
a]Apportioned Costs expected to be levied in part or in full at a later date.
b]Not reimbursable to the Developer through Assessments or the issuance of PID Bonds.
c]Preliminary estimates only and subject to change upon the issuance of PID Bonds.
d]Includes the fee of counsel to the Underwriter.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT E MAXIMUM ASSESSMENT AND TAX RATE EQUIVALENT
Per Unit Total Per Unit Total Per Unit Total Per Unit Total
Improvement Area 1
Lot Type 1 123 92,254$11,347,269$500,000$61,500,000$41,285$5,078,007$3,446.95$423,975.13$0.68939$
Lot Type 2 48 108,890$5,226,731$600,000$28,800,000$49,542$2,377,993$4,136.34$198,544.45$0.68939$
Improvement Area 1 Subtotal 171 16,574,000$90,300,000$7,456,000$622,519.58$0.68939$
Footnotes:
Lot Type Units[a]PIDTREEstimatedAppraisedValue[b]Estimated Buildout Value[a]Assessment Average Annual Installment
a]As provided by the Developer.
b]Based on the draft appraisal.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT F 1 IMPROVEMENT AREA 1 ASSESSMENT ROLL
Property
ID[a]Lot Type
Outstanding
Assessment
Annual Installment Due
1/31/2026[b]
1002239 Improvement Area 1 Initial Parcel 7,456,000.00$
Total 7,456,000.00$
Footnotes:
a] The entire Improvement Area #1 is contained within Property ID 1002239. For billing
purposes,the Annual Installment due 1/31/2026 shall be allocated pro rata based on acreage.
b]Includes one year of Capitalized Interest.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT F 2 IMPROVEMENT AREA 1 ANNUAL INSTALLMENTS
Installment
Due 1/31
Principal Interest[a]Capitalized
Interest
Reserve Fund
Additional
Interest
Annual
Collection
Costs
Total Annual
Installment Due[b]
2026 $326,815$326,815)$
2027 104,000$440,650$37,280$40,800$622,730$
2028 110,000$434,503$36,760$41,616$622,879$
2029 116,000$428,002$36,210$42,448$622,661$
2030 123,000$421,147$35,630$43,297$623,074$
2031 130,000$413,877$35,015$44,163$623,056$
2032 137,000$406,194$34,365$45,047$622,606$
2033 145,000$398,098$33,680$45,947$622,725$
2034 153,000$389,528$32,955$46,866$622,349$
2035 162,000$380,486$32,190$47,804$622,480$
2036 171,000$370,912$31,380$48,760$622,051$
2037 182,000$360,806$30,525$49,735$623,065$
2038 192,000$350,049$29,615$50,730$622,394$
2039 203,000$338,702$28,655$51,744$622,101$
2040 215,000$326,705$27,640$52,779$622,124$
2041 228,000$313,998$26,565$53,835$622,398$
2042 242,000$300,524$25,425$54,911$622,860$
2043 256,000$286,221$24,215$56,010$622,446$
2044 271,000$271,092$22,935$57,130$622,157$
2045 288,000$255,076$21,580$58,272$622,928$
2046 305,000$238,055$20,140$59,438$622,633$
2047 323,000$220,029$18,615$60,627$622,271$
2048 343,000$200,940$17,000$61,839$622,779$
2049 363,000$180,669$15,285$63,076$622,030$
2050 385,000$159,215$13,470$64,337$622,023$
2051 409,000$136,462$11,545$65,624$622,631$
2052 434,000$112,290$9,500$66,937$622,727$
2053 460,000$86,641$7,330$68,275$622,246$
2054 488,000$59,455$5,030$69,641$622,126$
2055 518,000$30,614$548,614)$2,590$71,034$73,624$
Total 7,456,000$8,637,753$326,815)$548,614)$703,125$1,582,723$17,504,172$
Footnotes:
a]Interest is calculated at a 5.910%rate for illustrative purposes and shall be updated based on PID Bond pricing.
b]The figures shown above are estimates only and subject to change in Annual Service Plan Updates.Changes in Annual
Collection Costs,reserve fund requirements,interest earnings,or other available offsets could increase or decrease the
amounts shown.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT G 1 MAPS OF MAJOR IMPROVEMENTS
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT G 2 MAPS OF IMPROVEMENT AREA 1 IMPROVEMENTS
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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EXHIBIT H FORM OF NOTICE OF ASSESSMENT TERMINATION
P3Works, LLC
9284 Huntington Square, Suite 100
North Richland Hills, TX 76182
Date]
Collin County Clerk’s Office
Honorable [County Clerk]
Collin County Administration Building
2300 Bloomdale Rd, Suite 2106
McKinney, TX 75071
Re: City of Anna Lien Release documents for filing
Dear Ms./Mr. [County Clerk]
Enclosed is a lien release that the City of Anna/County of Collin is requesting to be filed in your
office. Lien release for [insert legal description]. Recording Numbers: [Plat]. Please forward
copies of the filed documents to my attention:
City of Anna/County of Collin
Attn: City Secretary
120 W. 7th Street
Anna, TX 75409
Please contact me if you have any questions or need additional information.
Sincerely,
Signature]
P3Works, LLC
817) 393-0353
Admin@P3-Works.com
www.P3-Works.com
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
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AFTER RECORDING RETURN TO:
City Secretary Name]
120 W. 7th Street
Anna, TX 75409
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU
MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION
FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY
BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL
SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
FULL RELEASE OF PUBLIC IMPROVEMENT DISTRICT LIEN
STATE OF TEXAS §
KNOWN ALL MEN BY THESE PRESENTS:
COUNTY OF COLLIN §
THIS FULL RELEASE OF PUBLIC IMPROVEMENT DISTRICT LIEN (this "Full
Release") is executed and delivered as of the Effective Date by the City of Anna, Texas, a Texas
home rule municipality (the “City”).
RECITALS
WHEREAS, the governing body (hereinafter referred to as the "City Council" of the City is
authorized by Chapter 372, Texas Local Government Code, as amended (hereinafter referred to as
the "Act"), to create public improvement districts within the corporate limits of the City; and
WHEREAS, on February 5, 2025, the City Council of the City approved Resolution No.
2025-02-1744 creating Crystal Park Public Improvement District No. 2 (the “District”); and
WHEREAS, the District consists of approximately 274.396 contiguous acres within the
corporate limits of the City; and
WHEREAS, on____________, 2025 the City Council, approved Ordinance No.
hereinafter referred to as the "Assessment Ordinance") approving a service and
assessment plan and assessment roll for the real property located with the District, the Assessment
Ordinance being recorded on _____________, as Instrument No. ________ in the Official Public
Records of ______ County, Texas; and
WHEREAS, the Assessment Ordinance imposed an assessment in the amount of [amount]
hereinafter referred to as the "Lien Amount") and further imposed a lien to secure the payment of
the Lien Amount (the “Lien”) against the following property located within the District, to wit:
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
48
legal description], an addition to the City of Anna, Collin County, Texas, according
to the map or plat thereof recorded as Instrument No. ________ in the Map Records
of Collin County, Texas (the "Property");
and
WHEREAS, the Lien Amount has been paid in full.
RELEASE
NOW THEREFORE, for and in consideration of the full payment of the Lien Amount, the City
hereby releases and discharges, and by these presents does hereby release and discharge, the Lien to
the extent that is affects and encumbers the Property.
EXECUTED to be EFFECTIVE this the _____ day of _________, 20__.
CITY OF ANNA, TEXAS,
A Texas home rule municipality,
By: _______________________________
Manager Name], City Manager
ATTEST:
Secretary Name], City Secretary
STATE OF TEXAS §
COUNTY OF COLLIN §
This instrument was acknowledged before me on the ____ day of ________, 20__, by the
City Manager for the City of Anna, Texas, a Texas home rule municipality, on behalf of said
municipality.
Notary Public, State of Texas
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
49
EXHIBIT I DEBT SERVICE SCHEDULE FOR IMPROVEMENT AREA 1 BONDS
To be provided at PID Bond pricing.]
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
50
EXHIBIT J 1 DISTRICT LEGAL DESCRIPTION
PID DESCRIPTION
274.396 ACRES
BEING A 274.396 ACRE TRACT OF LAND SITUATED IN THE J.CAHILL SURVEY,ABSTRACT NO.144,THE
H.CHENAWETH SURVEY,ABSTRACT NO.158,THE J.COFFMAN SURVEY,ABSTRACT NO.197,THE J.
ELLETT SURVEY,ABSTRACT NO.295,THE W.KITCHINGS SURVEY,ABSTRACT NO.504 AND THE J.
KINCADE SURVEY ABSTRACT NO.510,CITY OF ANNA,COLLIN COUNTY,TEXAS,AND BEING PART OF A
243.477 ACRE TRACT OF LAND,CONVEYED BLOOMFIELD HOMES,L.P.,AS RECORDED IN COUNTY
CLERK'S FILE NO.20211220002575780,OFFICIAL PUBLIC RECORDS,COLLIN COUNTY,TEXAS AND
PART OF A 116.974 ACRE TRACT OF LAND CONVEYED TO BLOOMFIELD HOMES,L.P.,AS RECORDED IN
COUNTY CLERK'S FILE NO.2021220002551800 OFFICIAL PUBLIC RECORDS,COLLIN COUNTY,TEXAS.
SAID 274.396 ACRE TRACT,WITH BEARING BASIS BEING GRID NORTH,TEXAS STATE PLANE
COORDINATES,NORTH CENTRAL ZONE NAD83,NAD83 2011)EPOCH 2010),DETERMINED BY GPS
OBSERVATIONS,CALCULATED FROM COLLIN CORS ARP PID DF8982),AND DENTON CORS ARP
PID DF8986),AND BEING MORE PARTICULARLY DESCRIBED BY METES AND BOUNDS AS FOLLOWS:
BEGINNING AT FEET TO A 1/2"IRON FOUND FOR THE NORTH CORNER OF SAID 243.477 ACRE TRACT
AND THE COMMON SOUTHWEST CORNER OF A 5.765 ACRE TRACT OF LAND CONVEYED TO ANNA
GROUP LLC,AS RECORDED IN COUNTY CLERK'S FILE NO.2024000080846,OFFICIAL PUBLIC
RECORDS,COLLIN COUNTY,TEXAS.SAID POINT BEING ON THE EAST LINE OF A 64 ACRE TRACT OF
LAND CONVEYED TO NAOMI L.WATSON,AS RECORDED IN COUNTY CLERK'S FILE NO.
20140313000236380,OFFICIAL PUBLIC RECORDS,COLLIN COUNTY,TEXAS AND BEING WITHIN THE
APPROXIMATE CENTER OF COUNTY ROAD NO.937,A PRESCRIPTIVE RIGHT OF WAY BY USE AND
OCCUPATION),FROM WHICH A 1/2"IRON ROD WITH CAP STAMPED PEISER.MANKIN.SUR”FOUND FOR
THE NORTHWEST CORNER OF SAID 5.765 ACRE TRACT AND A COMMON SOUTHWEST CORNER OF A
101.118 ACRE TRACT OF LAND CONVEYED AS TRACT 1”TO ANNA GROUP LLC,AS RECORDED IN
COUNTY CLERK'S FILE NO.2023000122760,OFFICIAL PUBLIC RECORDS,COLLIN COUNTY,TEXAS,
BEARS NORTH 03 DEGREES 55 MINUTES 14 SECONDS EAST,A DISTANCE OF 50.00 FEET;
THENCE,ALONG THE NORTHEAST LINE OF SAID 243.477 ACRE TRACT AND THE COMMON
SOUTHWEST LINE OF SAID 5.765 ACRE TRACT,THE FOLLOWING COURSES AND DISTANCES:
SOUTH 48 DEGREES 26 MINUTES 03 SECONDS EAST,A DISTANCE OF 82.66 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 67 DEGREES 30 MINUTES 05 SECONDS EAST,A DISTANCE OF 84.40 FEET TO 60D NAIL
FOUND FOR CORNER;
SOUTH 62 DEGREES 35 MINUTES 14 SECONDS EAST,A DISTANCE OF 296.45 FEET TO A 60D NAIL
FOUND FOR CORNER;
SOUTH 41 DEGREES 10 MINUTES 03 SECONDS EAST,A DISTANCE OF 157.79 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 78 DEGREES 06 MINUTES 15 SECONDS EAST,A DISTANCE OF 262.41 FEET TO A 60D NAIL
FOUND FOR CORNER;
SOUTH 55 DEGREES 39 MINUTES 45 SECONDS EAST,A DISTANCE OF 144.29 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR THE SOUTHEAST
CORNER OF SAID 5.765 ACRE TRACT AND A COMMON EXTERIOR ELL CORNER OF AFORESAID
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
51
101.118 ACRE TRACT;
THENCE,CONTINUING ALONG THE NORTHEAST LINE OF SAID 243.477 ACRE TRACT AND THE
COMMON SOUTHWEST LINE OF SAID 101.118 ACRE TRACT,THE FOLLOWING COURSES AND
DISTANCES:
SOUTH 89 DEGREES 18 MINUTES 28 SECONDS EAST,A DISTANCE OF 348.05 FEET TO A 60D NAIL
FOUND FOR CORNER;
SOUTH 21 DEGREES 37 MINUTES 21 SECONDS EAST,A DISTANCE OF 346.53 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 06 DEGREES 07 MINUTES 23 SECONDS EAST,A DISTANCE OF 211.96 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 37 DEGREES 30 MINUTES 06 SECONDS EAST,A DISTANCE OF 88.02 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 64 DEGREES 23 MINUTES 44 SECONDS EAST,A DISTANCE OF 62.59 FEET TO A 60D NAIL
FOUND FOR CORNER;
SOUTH 42 DEGREES 35 MINUTES 09 SECONDS EAST,A DISTANCE OF 246.54 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 88 DEGREES 51 MINUTES 58 SECONDS EAST,A DISTANCE OF 72.92 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 61 DEGREES 26 MINUTES 55 SECONDS EAST,A DISTANCE OF 164.75 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 69 DEGREES 36 MINUTES 03 SECONDS EAST,A DISTANCE OF 58.91 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 17 DEGREES 13 MINUTES 17 SECONDS EAST,A DISTANCE OF 15.78 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 06 DEGREES 10 MINUTES 57 SECONDS EAST,A DISTANCE OF 125.36 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 53 DEGREES 17 MINUTES 57 SECONDS EAST,A DISTANCE OF 61.31 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 78 DEGREES 59 MINUTES 39 SECONDS EAST,A DISTANCE OF 125.01 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 80 DEGREES 01 MINUTE 26 SECONDS EAST,A DISTANCE OF 234.63 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 78 DEGREES 24 MINUTES 21 SECONDS EAST,A DISTANCE OF 426.09 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 80 DEGREES 54 MINUTES 25 SECONDS EAST,A DISTANCE OF 239.90 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 77 DEGREES 43 MINUTES 11 SECONDS EAST,A DISTANCE OF 68.50 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 71 DEGREES 14 MINUTES 49 SECONDS EAST,A DISTANCE OF 42.49 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 66 DEGREES 21 MINUTES 02 SECONDS EAST,A DISTANCE OF 67.58 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
SOUTH 55 DEGREES 56 MINUTES 20 SECONDS EAST,A DISTANCE OF 73.50 FEET A 1/2"IRON ROD
FOUND FOR THE SOUTHEAST CORNER OF SAID 101.118 ACRE TRACT AND A COMMON EXTERIOR
ELL CORNER OF AFORESAID 116.974 ACRE TRACT;
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
52
THENCE,ALONG THE COMMON LINES OF SAID 116.974 ACRE TRACT AND SAID 101.118 ACRE TRACT,
THE FOLLOWING COURSES AND DISTANCES:
NORTH 35 DEGREES 12 MINUTES 23 SECONDS EAST,A DISTANCE OF 177.76 FEET TO A 1/2"IRON
ROD FOUND FOR CORNER;
NORTH 42 DEGREES 44 MINUTES 06 SECONDS WEST,A DISTANCE OF 131.40 FEET TO A 1/2"IRON
ROD FOUND FOR CORNER;
NORTH 19 DEGREES 54 MINUTES 38 SECONDS WEST,A DISTANCE OF 41.83 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
NORTH 03 DEGREES 33 MINUTES 44 SECONDS WEST,A DISTANCE OF 30.38 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
NORTH 23 DEGREES 14 MINUTES 16 SECONDS EAST,A DISTANCE OF 444.46 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
NORTH 24 DEGREES 17 MINUTES 36 SECONDS EAST,A DISTANCE OF 216.53 FEET TO A POINT
FOR CORNER;
THENCE,OVER AND ACROSS SAID 116.974 ACRE TRACT,THE FOLLOWING COURSES AND DISTANCES:
SOUTH 85 DEGREES 34 MINUTES 50 SECONDS EAST,A DISTANCE OF 368.08 FEET TO A POINT
FOR CORNER;
SOUTH 35 DEGREES 22 MINUTES 48 SECONDS EAST,A DISTANCE OF 20.00 FEET TO A POINT FOR
CORNER,AND THE BEGINNING OF A NON TANGENT CURVE TO THE RIGHT HAVING A CENTRAL
ANGLE OF 65 DEGREES 38 MINUTES 29 SECONDS,A RADIUS OF 50.00 FEET,AND A LONG CHORD
THAT BEARS NORTH 87 DEGREES 26 MINUTES 26 SECONDS EAST,A DISTANCE OF 54.20 FEET;
ALONG SAID NON TANGENT CURVE TO THE RIGHT,AN ARC DISTANCE OF 57.28 FEET TO A POINT
FOR CORNER;
SOUTH 85 DEGREES 34 MINUTES 50 SECONDS EAST,A DISTANCE OF 208.41 FEET TO A POINT
FOR CORNER,AND THE BEGINNING OF A NON TANGENT CURVE TO THE RIGHT HAVING A
CENTRAL ANGLE OF 65 DEGREES 33 MINUTES 25 SECONDS,A RADIUS OF 50.00 FEET,AND A
LONG CHORD THAT BEARS SOUTH 78 DEGREES 38 MINUTES 39 SECONDS EAST,A DISTANCE OF
54.14 FEET;
ALONG SAID NON TANGENT CURVE TO THE RIGHT,AN ARC DISTANCE OF 57.21 FEET TO A POINT
FOR CORNER;
NORTH 44 DEGREES 08 MINUTES 04 SECONDS EAST,A DISTANCE OF 15.00 FEET TO A POINT FOR
CORNER;
SOUTH 85 DEGREES 34 MINUTES 50 SECONDS EAST,A DISTANCE OF 485.58 FEET TO A POINT
FOR CORNER;
SOUTH 16 DEGREES 40 MINUTES 30 SECONDS WEST,A DISTANCE OF 689.68 FEET TO A POINT
FOR CORNER,AND THE BEGINNING OF A TANGENT CURVE TO THE RIGHT HAVING A CENTRAL
ANGLE OF 21 DEGREES 38 MINUTES 12 SECONDS,A RADIUS OF 1105.00 FEET,AND A LONG
CHORD THAT BEARS SOUTH 27 DEGREES 29 MINUTES 36 SECONDS WEST,A DISTANCE OF 414.81
FEET;
ALONG SAID TANGENT CURVE TO THE RIGHT,AN ARC DISTANCE OF 417.28 FEET TO A POINT
FOR CORNER;
NORTH 50 DEGREES 23 MINUTES 31 SECONDS WEST,A DISTANCE OF 27.69 FEET TO A POINT
FOR CORNER;
SOUTH 39 DEGREES 36 MINUTES 29 SECONDS WEST,A DISTANCE OF 50.00 FEET TO A POINT
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
53
FOR CORNER;
SOUTH 50 DEGREES 23 MINUTES 31 SECONDS EAST,A DISTANCE OF 27.69 FEET TO A POINT FOR
CORNER,AND THE BEGINNING OF A NON TANGENT CURVE TO THE RIGHT HAVING A CENTRAL
ANGLE OF 01 DEGREE 30 MINUTES 09 SECONDS,A RADIUS OF 1105.00 FEET,AND A LONG CHORD
THAT BEARS SOUTH 41 DEGREES 39 MINUTES 21 SECONDS WEST,A DISTANCE OF 28.98 FEET;
ALONG SAID NO TANGENT CURVE TO THE RIGHT,AN ARC DISTANCE OF 28.98 FEET TO A POINT
FOR CORNER;
SOUTH 42 DEGREES 25 MINUTES 45 SECONDS WEST,A DISTANCE OF 563.28 FEET TO A POINT
FOR CORNER,AND THE BEGINNING OF A TANGENT CURVE TO THE LEFT HAVING A CENTRAL
ANGLE OF 13 DEGREES 25 MINUTES 22 SECONDS,A RADIUS OF 1545.00 FEET,AND A LONG
CHORD THAT BEARS SOUTH 35 DEGREES 43 MINUTES 04 SECONDS WEST,A DISTANCE OF 361.12
FEET;
ALONG SAID TANGENT CURVE TO THE LEFT,AN ARC DISTANCE OF 361.95 FEET TO A POINT FOR
CORNER ON A SOUTHERLY LINE OF SAID 116.974 ACRE TRACT AND THE COMMON NORTH LINE
OF A TRACT OF LAND CONVEYED TO JOHN RATTAN AND SUE RATTAN,AS RECORDED IN COUNTY
CLERK'S FILE NO.20090915001153020,OFFICIAL PUBLIC RECORDS,COLLIN COUNTY,TEXAS,
FROM WHICH A 1/2"IRON ROD FOUND FOR AN INTERIOR ELL CORNER OF SAID 116.974 ACRE
TRACT AND THE COMMON NORTHEAST CORNER OF SAID RATTAN TRACT,BEARS SOUTH 78
DEGREES 24 MINUTES 56 SECONDS EAST,A DISTANCE OF 625.73 FEET;
THENCE,NORTH 78 DEGREES 24 MINUTES 56 SECONDS WEST,ALONG SAID COMMON LINE,A
DISTANCE OF 74.94 FEET TO A 5/8”IRON ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING”
SET FOR AN EXTERIOR ELL CORNER OF SAID 116.974 ACRE TRACT AND THE COMMON NORTHWEST
CORNER OF SAID RATTAN TRACT.SAID POINT BEING ON THE EAST LINE OF AFORESAID 243.477
ACRE TRACT;
THENCE,ALONG THE EAST LINE OF SAID 243.477 ACRE TRACT AND THE COMMON WEST LINE OF SAID
RATTAN TRACT,THE FOLLOWING COURSES AND DISTANCES:
SOUTH 02 DEGREES 45 MINUTES 42 SECONDS EAST,A DISTANCE OF 22.19 FEET TO A 5/8”IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING”SET FOR CORNER;
SOUTH 04 DEGREES 42 MINUTES 42 SECONDS WEST,A DISTANCE OF 178.16 FEET TO A POINT
FOR CORNER AND THE BEGINNING OF A NON TANGENT CURVE TO THE LEFT HAVING A CENTRAL
ANGLE OF 20 DEGREES 12 MINUTES 17 SECONDS,A RADIUS OF 1545.00 FEET,AND A LONG
CHORD THAT BEARS SOUTH 11 DEGREES 19 MINUTES 42 SECONDS WEST,A DISTANCE OF 542.01
FEET;
THENCE,OVER AND ACROSS SAID 243.477 ACRE TRACT,THE FOLLOWING COURSES AND DISTANCES:
ALONG SAID NON TANGENT CURVE TO THE LEFT,AN ARC DISTANCE OF 544.83 FEET TO A POINT FOR
CORNER;
SOUTH 01 DEGREE 13 MINUTES 34 SECONDS WEST,A DISTANCE OF 572.11 FEET TO A POINT FOR
CORNER;
SOUTH 87 DEGREES 14 MINUTES 28 SECONDS WEST,A DISTANCE OF 3169.43 FEET TO A POINT
FOR
CORNER ON THE WEST LINE OF SAID 243.477 ACRE TRACT AND THE COMMON EAST LINE OF A
216.801 ACRE TRACT OF LAND CONVEYED TO VERLA SUE HOLLAND AND MAURINE DICKEY,AS
RECORDED IN COUNTY CLERK'S FILE NO.95 0011069,OFFICIAL PUBLIC RECORDS,COLLIN
COUNTY,
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
54
TEXAS,FROM WHICH A 60D NAIL FOUND FOR THE SOUTHWEST CORNER OF SAID 243.477 ACRE
TRACT AND A COMMON EXTERIOR ELL CORNER OF A 140.00 ACRE TRACT OF LAND CONVEYED TO
MJLA ADAM,LTD,AS RECORDED IN COUNTY CLERK'S FILE NO.20110505000462570,OFFICIAL
PUBLIC
RECORDS,COLLIN COUNTY,TEXAS BEARS SOUTH 02 DEGREES 16 MINUTES 14 SECONDS WEST,A
DISTANCE OF 60.23 FEET;
THENCE,ALONG THE COMMON LINES OF SAID 243.477 ACRE TRACT AND THE SAID 216.801 ACRE
TRACT,THE FOLLOWING COURSES AND DISTANCES:
NORTH 02 DEGREES 16 MINUTES 14 SECONDS EAST,A DISTANCE OF 59.76 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
NORTH 00 DEGREES 42 MINUTES 51 SECONDS WEST,A DISTANCE OF 640.05 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
NORTH 00 DEGREES 45 MINUTES 11 SECONDS WEST,A DISTANCE OF 357.30 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
NORTH 01 DEGREE 39 MINUTES 21 SECONDS WEST,A DISTANCE OF 381.16 FEET TO A 1/2"IRON
ROD FOUND FOR AN INTERIOR ELL CORNER,OF SAID 243.477 ACRE TRACT AND THE COMMON
NORTHEAST CORNER OF SAID 216.801 ACRE TRACT.SAID POINT BEING AT THE END OF
AFORESAID COUNTY ROAD NO.937;
NORTH 87 DEGREES 21 MINUTES 39 SECONDS WEST,A DISTANCE OF 29.55 FEET TO A 60D NAIL
FOUND FOR AN EXTERIOR ELL CORNER OF SAID 243.477 ACRE TRACT AND THE COMMON
SOUTHEAST CORNER OF A 245.6 ACRE TRACT OF LAND CONVEYED TO VIRGIL WREN MILLER,AS
RECORDED IN VOLUME 5823,PAGE 3619,OFFICIAL PUBLIC RECORDS,COLLIN COUNTY,TEXAS;
THENCE,ALONG THE WEST LINE OF SAID 243.477 ACRE TRACT AND THE COMMON EAST LINE OF SAID
245.6 ACRE TRACT,WITH SAID COUNTY ROAD NO.937,THE FOLLOWING COURSES AND DISTANCES:
NORTH 12 DEGREES 06 MINUTES 31 SECONDS WEST,A DISTANCE OF 109.36 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
NORTH 06 DEGREES 52 MINUTES 41 SECONDS WEST,A DISTANCE OF 258.10 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
NORTH 09 DEGREES 46 MINUTES 25 SECONDS WEST,A DISTANCE OF 725.61 FEET TO A 60D NAIL
FOUND FOR CORNER;
NORTH 28 DEGREES 35 MINUTES 06 SECONDS WEST,A DISTANCE OF 186.41 FEET TO A 5/8"IRON
ROD WITH YELLOW PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
NORTH 14 DEGREES 05 MINUTES 23 SECONDS WEST,A DISTANCE OF 170.86 FEET TO A 60D NAIL
FOUND FOR CORNER;
NORTH 00 DEGREES 03 MINUTES 33 SECONDS EAST,A DISTANCE OF 250.08 FEET TO A 60D NAIL
FOUND BENT)FOR CORNER;
NORTH 02 DEGREES 44 MINUTES 20 SECONDS EAST,PASSING THE NORTH LINE OF SAID 245.6
ACRE TRACT AND THE COMMON SOUTH LINE OF AFORESAID 64 ACRE TRACT,AND CONTINUING
ALONG THE WEST LINE OF SAID 243.477 ACRE TRACT AND THE COMMON EAST LINE OF SAID 64
ACRE TRACT,IN ALL,A TOTAL DISTANCE OF 254.07 FEET TO A 5/8"IRON ROD WITH YELLOW
PLASTIC CAP STAMPED LJA SURVEYING"SET FOR CORNER;
THENCE,NORTH 03 DEGREES 55 MINUTES 14 SECONDS EAST,CONTINUING ALONG SAID COMMON
LINE,WITH SAID COUNTY ROAD NO.937,A DISTANCE OF 923.21 FEET TO THE POINT OF BEGINNING
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
55
AND CONTAINING A CALCULATED AREA OF 11,952,682 SQUARE FEET OR 274.396 ACRES OF LAND.
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
56
EXHIBIT J 2 IMPROVEMENT AREA 1 LEGAL DESCRIPTION
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
57
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
58
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
59
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
60
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
61
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
62
APPENDIX A ENGINEER’S REPORT
Remainder of page left intentionally blank.]
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2
PRELIMINARY SERVICE AND ASSESSMENT PLAN
63
APPENDIX B BUYER DISCLOSURES
Forms of the buyer disclosures for the following Lot Types are found in this appendix:
Improvement Area 1
Improvement Area 1 Initial Parcel
Lot Type 1
Lot Type 2
Remainder of page left intentionally blank.]
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2 IMPROVEMENT AREA 1
INITIAL PARCEL BUYER DISCLOSURE
NOTICE OF OBLIGATIONS RELATED TO PUBLIC IMPROVEMENT DISTRICT
A person who proposes to sell or otherwise convey real property that is located in a public
improvement district established under Subchapter A, Chapter 372, Local Government Code
except for public improvement districts described under Section 372.005), or Chapter 382,
Local Government Code, shall first give to the purchaser of the property this written notice,
signed by the seller.
For the purposes of this notice, a contract for the purchase and sale of real property having a
performance period of less than six months is considered a sale requiring the notice set forth below.
This notice requirement does not apply to a transfer:
1) under a court order or foreclosure sale;
2) by a trustee in bankruptcy;
3) to a mortgagee by a mortgagor or successor in interest or to a beneficiary
of a deed of trust by a trustor or successor in interest;
4) by a mortgagee or a beneficiary under a deed of trust who has acquired the
land at a sale conducted under a power of sale under a deed of trust or a sale
under a court-ordered foreclosure or has acquired the land by a deed in lieu of
foreclosure;
5) by a fiduciary in the course of the administration of a decedent's
estate, guardianship, conservatorship, or trust;
6) from one co-owner to another co-owner of an undivided interest in the
real property;
7) to a spouse or a person in the lineal line of consanguinity of the seller;
8) to or from a governmental entity; or
9) of only a mineral interest, leasehold interest, or security interest
The following notice shall be given to a prospective purchaser before the execution of a binding
contract of purchase and sale, either separately or as an addendum or paragraph of a purchase
contract. In the event a contract of purchase and sale is entered into without the seller having
provided the required notice, the purchaser, subject to certain exceptions, is entitled to terminate
the contract.
A separate copy of this notice shall be executed by the seller and the purchaser and must be
filed in the real property records of the county in which the property is located at the closing of
the purchase and sale of the property.
AFTER RECORDING1 RETURN TO:
NOTICE OF OBLIGATION TO PAY IMPROVEMENT DISTRICT ASSESSMENT TO
CITY OF ANNA, TEXAS
CONCERNING THE FOLLOWING PROPERTY
STREET ADDRESS
IMPROVEMENT AREA #1 INITIAL PARCEL PRINCIPAL ASSESSMENT:
7,456,000.00
As the purchaser of the real property described above, you are obligated to pay
assessments to City of Anna, Texas, for the costs of a portion of a public improvement or services
project (the "Authorized Improvements") undertaken for the benefit of the property within Crystal
Park Public Improvement District No. 2 (the "District") created under Subchapter A, Chapter
372, Local Government Code.
AN ASSESSMENT HAS BEEN LEVIED AGAINST YOUR PROPERTY FOR THE
AUTHORIZED IMPROVEMENTS, WHICH MAY BE PAID IN FULL AT ANY TIME. IF
THE ASSESSMENT IS NOT PAID IN FULL, IT WILL BE DUE AND PAYABLE IN
ANNUAL INSTALLMENTS THAT WILL VARY FROM YEAR TO YEAR DEPENDING
ON THE AMOUNT OF INTEREST PAID, COLLECTION COSTS, ADMINISTRATIVE
COSTS, AND DELINQUENCY COSTS.
The exact amount of the assessment may be obtained from the City of Anna. The exact
amount of each annual installment will be approved each year by the Anna City Council in the
annual service plan update for the District. More information about the assessments, including
the amounts and due dates, may be obtained from City of Anna.
Your failure to pay any assessment or any annual installment may result in penalties and
interest being added to what you owe or in a lien on and the foreclosure of your property.
1 To be included in separate copy of the notice required by Section 5.0143, Tex. Prop. Code, to be executed at the
closing of the purchase and sale and to be recorded in the deed records of Collin County when updating for the Current Information
of Obligation to Pay Improvement District Assessment.
Signature Page to Initial Notice
of Obligation to Pay Improvement District Assessment
The undersigned purchaser acknowledges receipt of this notice before the effective date
of a binding contract for the purchase of the real property at the address described above.
DATE: DATE:
SIGNATURE OF PURCHASER SIGNATURE OF PURCHASER
The undersigned seller acknowledges providing this notice to the potential purchaser
before the effective date of a binding contract for the purchase of the real property at the address
described above.
DATE: DATE:
SIGNATURE OF SELLER SIGNATURE OF SELLER]2
2 To be included in copy of the notice required by Section 5.014, Tex. Prop. Code, to be executed by seller in accordance with
Section 5.014(a-1), Tex. Prop. Code.
Purchaser Signature Page to Final Notice with Current Information
of Obligation to Pay Improvement District Assessment
The undersigned purchaser acknowledges receipt of this notice before the effective date
of a binding contract for the purchase of the real property at the address described above. The
undersigned purchaser acknowledged the receipt of this notice including the current
information required by Section 5.0143, Texas Property Code, as amended.
DATE: DATE:
SIGNATURE OF PURCHASER SIGNATURE OF PURCHASER
STATE OF TEXAS §
COUNTY OF _______ §
The foregoing instrument was acknowledged before me by ____________________ and
known to me to be the person(s) whose name(s) is/are subscribed to the
foregoing instrument, and acknowledged to me that he or she executed the same for the
purposes therein expressed.
Given under my hand and seal of office on this _________________ , 20__.
Notary Public, State of Texas]3
3 To be included in separate copy of the notice required by Section 5.0143, Tex. Prop. Code, to be executed at the closing of the
purchase and sale and to be recorded in the deed records of Collin County.
Seller Signature Page to Final Notice with Current Information
of Obligation to Pay Improvement District Assessment
The undersigned seller acknowledges providing a separate copy of the notice required by
Section 5.014 of the Texas Property Code including the current information required by Section
5.0143, Texas Property Code, as amended, at the closing of the purchase of the real property at the
address above.
DATE: DATE:
SIGNATURE OF SELLER SIGNATURE OF SELLER
STATE OF TEXAS §
COUNTY OF ________ §
The foregoing instrument was acknowledged before me by ______________________ and
known to me to be the person(s) whose name(s) is/are subscribed to the
foregoing instrument, and acknowledged to me that he or she executed the same for the purposes
therein expressed.
Given under my hand and seal of office on this _________________, 20__.
Notary Public, State of Texas]4
4 To be included in separate copy of the notice required by Section 5.0143, Tex. Prop. Code, to be executed at the closing of the purchase
and sale and to be recorded in the deed records of Collin County.
Annual Installment Schedule to Notice
of Obligation to Pay Improvement District Assessment
Installment
Due 1/31
Principal Interest[a]Capitalized
Interest
Additional
Interest
Annual
Collection
Costs
Total Annual
Installment Due[b]
2026 $326,815$326,815)$
2027 104,000$440,650$37,280$40,800$622,730$
2028 110,000$434,503$36,760$41,616$622,879$
2029 116,000$428,002$36,210$42,448$622,661$
2030 123,000$421,147$35,630$43,297$623,074$
2031 130,000$413,877$35,015$44,163$623,056$
2032 137,000$406,194$34,365$45,047$622,606$
2033 145,000$398,098$33,680$45,947$622,725$
2034 153,000$389,528$32,955$46,866$622,349$
2035 162,000$380,486$32,190$47,804$622,480$
2036 171,000$370,912$31,380$48,760$622,051$
2037 182,000$360,806$30,525$49,735$623,065$
2038 192,000$350,049$29,615$50,730$622,394$
2039 203,000$338,702$28,655$51,744$622,101$
2040 215,000$326,705$27,640$52,779$622,124$
2041 228,000$313,998$26,565$53,835$622,398$
2042 242,000$300,524$25,425$54,911$622,860$
2043 256,000$286,221$24,215$56,010$622,446$
2044 271,000$271,092$22,935$57,130$622,157$
2045 288,000$255,076$21,580$58,272$622,928$
2046 305,000$238,055$20,140$59,438$622,633$
2047 323,000$220,029$18,615$60,627$622,271$
2048 343,000$200,940$17,000$61,839$622,779$
2049 363,000$180,669$15,285$63,076$622,030$
2050 385,000$159,215$13,470$64,337$622,023$
2051 409,000$136,462$11,545$65,624$622,631$
2052 434,000$112,290$9,500$66,937$622,727$
2053 460,000$86,641$7,330$68,275$622,246$
2054 488,000$59,455$5,030$69,641$622,126$
2055 518,000$30,614$2,590$71,034$622,238$
Total 7,456,000$8,637,753$326,815)$703,125$1,582,723$18,052,786$
Footnotes:
a]Interest is calculated at a 5.910%rate for illustrative purposes and shall be updated based on PID Bond
pricing.
b]The figures shown above are estimates only and subject to change in Annual Service Plan Updates.
Changes in Annual Collection Costs,reserve fund requirements,interest earnings,or other available offsets
could increase or decrease the amounts shown.
ANNUAL INSTALLMENTS IMPROVEMENT AREA 1 INITIAL PARCEL
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2 IMPROVEMENT AREA 1
LOT TYPE 1 BUYER DISCLOSURE
NOTICE OF OBLIGATIONS RELATED TO PUBLIC IMPROVEMENT DISTRICT
A person who proposes to sell or otherwise convey real property that is located in a public
improvement district established under Subchapter A, Chapter 372, Local Government Code
except for public improvement districts described under Section 372.005), or Chapter 382,
Local Government Code, shall first give to the purchaser of the property this written notice,
signed by the seller.
For the purposes of this notice, a contract for the purchase and sale of real property having a
performance period of less than six months is considered a sale requiring the notice set forth below.
This notice requirement does not apply to a transfer:
1) under a court order or foreclosure sale;
2) by a trustee in bankruptcy;
3) to a mortgagee by a mortgagor or successor in interest or to a beneficiary
of a deed of trust by a trustor or successor in interest;
4) by a mortgagee or a beneficiary under a deed of trust who has acquired the
land at a sale conducted under a power of sale under a deed of trust or a sale
under a court-ordered foreclosure or has acquired the land by a deed in lieu of
foreclosure;
5) by a fiduciary in the course of the administration of a decedent's
estate, guardianship, conservatorship, or trust;
6) from one co-owner to another co-owner of an undivided interest in the
real property;
7) to a spouse or a person in the lineal line of consanguinity of the seller;
8) to or from a governmental entity; or
9) of only a mineral interest, leasehold interest, or security interest
The following notice shall be given to a prospective purchaser before the execution of a binding
contract of purchase and sale, either separately or as an addendum or paragraph of a purchase
contract. In the event a contract of purchase and sale is entered into without the seller having
provided the required notice, the purchaser, subject to certain exceptions, is entitled to terminate
the contract.
A separate copy of this notice shall be executed by the seller and the purchaser and must be
filed in the real property records of the county in which the property is located at the closing of
the purchase and sale of the property.
AFTER RECORDING1 RETURN TO:
NOTICE OF OBLIGATION TO PAY IMPROVEMENT DISTRICT ASSESSMENT TO
CITY OF ANNA, TEXAS
CONCERNING THE FOLLOWING PROPERTY
STREET ADDRESS
IMPROVEMENT AREA #1 LOT TYPE 1 PRINCIPAL ASSESSMENT: $41,284.61
As the purchaser of the real property described above, you are obligated to pay
assessments to City of Anna, Texas, for the costs of a portion of a public improvement or services
project (the "Authorized Improvements") undertaken for the benefit of the property within Crystal
Park Public Improvement District No. 2 (the "District") created under Subchapter A, Chapter
372, Local Government Code.
AN ASSESSMENT HAS BEEN LEVIED AGAINST YOUR PROPERTY FOR THE
AUTHORIZED IMPROVEMENTS, WHICH MAY BE PAID IN FULL AT ANY TIME. IF
THE ASSESSMENT IS NOT PAID IN FULL, IT WILL BE DUE AND PAYABLE IN
ANNUAL INSTALLMENTS THAT WILL VARY FROM YEAR TO YEAR DEPENDING
ON THE AMOUNT OF INTEREST PAID, COLLECTION COSTS, ADMINISTRATIVE
COSTS, AND DELINQUENCY COSTS.
The exact amount of the assessment may be obtained from the City of Anna. The exact
amount of each annual installment will be approved each year by the Anna City Council in the
annual service plan update for the District. More information about the assessments, including
the amounts and due dates, may be obtained from City of Anna.
Your failure to pay any assessment or any annual installment may result in penalties and
interest being added to what you owe or in a lien on and the foreclosure of your property.
1 To be included in separate copy of the notice required by Section 5.0143, Tex. Prop. Code, to be executed at the
closing of the purchase and sale and to be recorded in the deed records of Collin County when updating for the Current Information
of Obligation to Pay Improvement District Assessment.
Signature Page to Initial Notice
of Obligation to Pay Improvement District Assessment
The undersigned purchaser acknowledges receipt of this notice before the effective date
of a binding contract for the purchase of the real property at the address described above.
DATE: DATE:
SIGNATURE OF PURCHASER SIGNATURE OF PURCHASER
The undersigned seller acknowledges providing this notice to the potential purchaser
before the effective date of a binding contract for the purchase of the real property at the address
described above.
DATE: DATE:
SIGNATURE OF SELLER SIGNATURE OF SELLER]2
2 To be included in copy of the notice required by Section 5.014, Tex. Prop. Code, to be executed by seller in accordance with
Section 5.014(a-1), Tex. Prop. Code.
Purchaser Signature Page to Final Notice with Current Information
of Obligation to Pay Improvement District Assessment
The undersigned purchaser acknowledges receipt of this notice before the effective date
of a binding contract for the purchase of the real property at the address described above. The
undersigned purchaser acknowledged the receipt of this notice including the current
information required by Section 5.0143, Texas Property Code, as amended.
DATE: DATE:
SIGNATURE OF PURCHASER SIGNATURE OF PURCHASER
STATE OF TEXAS §
COUNTY OF _______ §
The foregoing instrument was acknowledged before me by ____________________ and
known to me to be the person(s) whose name(s) is/are subscribed to the
foregoing instrument, and acknowledged to me that he or she executed the same for the
purposes therein expressed.
Given under my hand and seal of office on this _________________ , 20__.
Notary Public, State of Texas]3
3 To be included in separate copy of the notice required by Section 5.0143, Tex. Prop. Code, to be executed at the closing of the
purchase and sale and to be recorded in the deed records of Collin County.
Seller Signature Page to Final Notice with Current Information
of Obligation to Pay Improvement District Assessment
The undersigned seller acknowledges providing a separate copy of the notice required by
Section 5.014 of the Texas Property Code including the current information required by Section
5.0143, Texas Property Code, as amended, at the closing of the purchase of the real property at the
address above.
DATE: DATE:
SIGNATURE OF SELLER SIGNATURE OF SELLER
STATE OF TEXAS §
COUNTY OF ________ §
The foregoing instrument was acknowledged before me by ______________________ and
known to me to be the person(s) whose name(s) is/are subscribed to the
foregoing instrument, and acknowledged to me that he or she executed the same for the purposes
therein expressed.
Given under my hand and seal of office on this _________________, 20__.
Notary Public, State of Texas]4
4 To be included in separate copy of the notice required by Section 5.0143, Tex. Prop. Code, to be executed at the closing of the purchase
and sale and to be recorded in the deed records of Collin County.
Annual Installment Schedule to Notice
of Obligation to Pay Improvement District Assessment
Installment
Due 1/31
Principal Interest[a]Capitalized
Interest
Additional
Interest
Annual
Collection
Costs
Total Annual
Installment
Due[b]
2026 $1,809.61$1,809.61)$
2027 575.86$2,439.92$206.42$225.91$3,448.12$
2028 609.08$2,405.89$203.54$230.43$3,448.94$
2029 642.30$2,369.89$200.50$235.04$3,447.73$
2030 681.06$2,331.93$197.29$239.74$3,450.02$
2031 719.82$2,291.68$193.88$244.54$3,449.92$
2032 758.58$2,249.14$190.28$249.43$3,447.43$
2033 802.88$2,204.31$186.49$254.42$3,448.09$
2034 847.18$2,156.86$182.48$259.50$3,446.01$
2035 897.01$2,106.79$178.24$264.69$3,446.73$
2036 946.84$2,053.77$173.75$269.99$3,444.36$
2037 1,007.75$1,997.82$169.02$275.39$3,449.97$
2038 1,063.12$1,938.26$163.98$280.90$3,446.26$
2039 1,124.03$1,875.43$158.67$286.51$3,444.64$
2040 1,190.48$1,809.00$153.05$292.24$3,444.76$
2041 1,262.46$1,738.64$147.09$298.09$3,446.28$
2042 1,339.98$1,664.03$140.78$304.05$3,448.84$
2043 1,417.50$1,584.84$134.08$310.13$3,446.54$
2044 1,500.55$1,501.06$126.99$316.33$3,444.94$
2045 1,594.68$1,412.38$119.49$322.66$3,449.21$
2046 1,688.82$1,318.13$111.52$329.11$3,447.58$
2047 1,788.48$1,218.32$103.07$335.70$3,445.58$
2048 1,899.22$1,112.62$94.13$342.41$3,448.39$
2049 2,009.97$1,000.38$84.63$349.26$3,444.24$
2050 2,131.78$881.59$74.58$356.24$3,444.20$
2051 2,264.67$755.60$63.93$363.37$3,447.57$
2052 2,403.10$621.76$52.60$370.64$3,448.10$
2053 2,547.07$479.74$40.59$378.05$3,445.44$
2054 2,702.10$329.21$27.85$385.61$3,444.77$
2055 2,868.22$169.51$14.34$393.32$3,445.39$
Total 41,284.61$47,828.09$1,809.61)$3,893.27$8,763.69$99,960.05$
Footnotes:
a]Interest is calculated at a 5.910%rate for illustrative purposes and shall be updated based on PID Bond
pricing.
b]The figures shown above are estimates only and subject to change in Annual Service Plan Updates.
Changes in Annual Collection Costs,reserve fund requirements,interest earnings,or other available
offsets could increase or decrease the amounts shown.
ANNUAL INSTALLMENTS IMPROVEMENT AREA 1 LOT TYPE 1
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO.2 IMPROVEMENT AREA 1
LOT TYPE 2 BUYER DISCLOSURE
NOTICE OF OBLIGATIONS RELATED TO PUBLIC IMPROVEMENT DISTRICT
A person who proposes to sell or otherwise convey real property that is located in a public
improvement district established under Subchapter A, Chapter 372, Local Government Code
except for public improvement districts described under Section 372.005), or Chapter 382,
Local Government Code, shall first give to the purchaser of the property this written notice,
signed by the seller.
For the purposes of this notice, a contract for the purchase and sale of real property having a
performance period of less than six months is considered a sale requiring the notice set forth below.
This notice requirement does not apply to a transfer:
1) under a court order or foreclosure sale;
2) by a trustee in bankruptcy;
3) to a mortgagee by a mortgagor or successor in interest or to a beneficiary
of a deed of trust by a trustor or successor in interest;
4) by a mortgagee or a beneficiary under a deed of trust who has acquired the
land at a sale conducted under a power of sale under a deed of trust or a sale
under a court-ordered foreclosure or has acquired the land by a deed in lieu of
foreclosure;
5) by a fiduciary in the course of the administration of a decedent's
estate, guardianship, conservatorship, or trust;
6) from one co-owner to another co-owner of an undivided interest in the
real property;
7) to a spouse or a person in the lineal line of consanguinity of the seller;
8) to or from a governmental entity; or
9) of only a mineral interest, leasehold interest, or security interest
The following notice shall be given to a prospective purchaser before the execution of a binding
contract of purchase and sale, either separately or as an addendum or paragraph of a purchase
contract. In the event a contract of purchase and sale is entered into without the seller having
provided the required notice, the purchaser, subject to certain exceptions, is entitled to terminate
the contract.
A separate copy of this notice shall be executed by the seller and the purchaser and must be
filed in the real property records of the county in which the property is located at the closing of
the purchase and sale of the property.
AFTER RECORDING1 RETURN TO:
NOTICE OF OBLIGATION TO PAY IMPROVEMENT DISTRICT ASSESSMENT TO
CITY OF ANNA, TEXAS
CONCERNING THE FOLLOWING PROPERTY
STREET ADDRESS
IMPROVEMENT AREA #1 LOT TYPE 2 PRINCIPAL ASSESSMENT: $49,541.53
As the purchaser of the real property described above, you are obligated to pay
assessments to City of Anna, Texas, for the costs of a portion of a public improvement or services
project (the "Authorized Improvements") undertaken for the benefit of the property within Crystal
Park Public Improvement District No. 2 (the "District") created under Subchapter A, Chapter
372, Local Government Code.
AN ASSESSMENT HAS BEEN LEVIED AGAINST YOUR PROPERTY FOR THE
AUTHORIZED IMPROVEMENTS, WHICH MAY BE PAID IN FULL AT ANY TIME. IF
THE ASSESSMENT IS NOT PAID IN FULL, IT WILL BE DUE AND PAYABLE IN
ANNUAL INSTALLMENTS THAT WILL VARY FROM YEAR TO YEAR DEPENDING
ON THE AMOUNT OF INTEREST PAID, COLLECTION COSTS, ADMINISTRATIVE
COSTS, AND DELINQUENCY COSTS.
The exact amount of the assessment may be obtained from the City of Anna. The exact
amount of each annual installment will be approved each year by the Anna City Council in the
annual service plan update for the District. More information about the assessments, including
the amounts and due dates, may be obtained from City of Anna.
Your failure to pay any assessment or any annual installment may result in penalties and
interest being added to what you owe or in a lien on and the foreclosure of your property.
1 To be included in separate copy of the notice required by Section 5.0143, Tex. Prop. Code, to be executed at the
closing of the purchase and sale and to be recorded in the deed records of Collin County when updating for the Current Information
of Obligation to Pay Improvement District Assessment.
Signature Page to Initial Notice
of Obligation to Pay Improvement District Assessment
The undersigned purchaser acknowledges receipt of this notice before the effective date
of a binding contract for the purchase of the real property at the address described above.
DATE: DATE:
SIGNATURE OF PURCHASER SIGNATURE OF PURCHASER
The undersigned seller acknowledges providing this notice to the potential purchaser
before the effective date of a binding contract for the purchase of the real property at the address
described above.
DATE: DATE:
SIGNATURE OF SELLER SIGNATURE OF SELLER]2
2 To be included in copy of the notice required by Section 5.014, Tex. Prop. Code, to be executed by seller in accordance with
Section 5.014(a-1), Tex. Prop. Code.
Purchaser Signature Page to Final Notice with Current Information
of Obligation to Pay Improvement District Assessment
The undersigned purchaser acknowledges receipt of this notice before the effective date
of a binding contract for the purchase of the real property at the address described above. The
undersigned purchaser acknowledged the receipt of this notice including the current
information required by Section 5.0143, Texas Property Code, as amended.
DATE: DATE:
SIGNATURE OF PURCHASER SIGNATURE OF PURCHASER
STATE OF TEXAS §
COUNTY OF _______ §
The foregoing instrument was acknowledged before me by ____________________ and
known to me to be the person(s) whose name(s) is/are subscribed to the
foregoing instrument, and acknowledged to me that he or she executed the same for the
purposes therein expressed.
Given under my hand and seal of office on this _________________ , 20__.
Notary Public, State of Texas]3
3 To be included in separate copy of the notice required by Section 5.0143, Tex. Prop. Code, to be executed at the closing of the
purchase and sale and to be recorded in the deed records of Collin County.
Seller Signature Page to Final Notice with Current Information
of Obligation to Pay Improvement District Assessment
The undersigned seller acknowledges providing a separate copy of the notice required by
Section 5.014 of the Texas Property Code including the current information required by Section
5.0143, Texas Property Code, as amended, at the closing of the purchase of the real property at the
address above.
DATE: DATE:
SIGNATURE OF SELLER SIGNATURE OF SELLER
STATE OF TEXAS §
COUNTY OF ________ §
The foregoing instrument was acknowledged before me by ______________________ and
known to me to be the person(s) whose name(s) is/are subscribed to the
foregoing instrument, and acknowledged to me that he or she executed the same for the purposes
therein expressed.
Given under my hand and seal of office on this _________________, 20__.
Notary Public, State of Texas]4
4 To be included in separate copy of the notice required by Section 5.0143, Tex. Prop. Code, to be executed at the closing of the purchase
and sale and to be recorded in the deed records of Collin County.
Annual Installment Schedule to Notice
of Obligation to Pay Improvement District Assessment
Installment
Due 1/31
Principal Interest[a]Capitalized
Interest
Additional
Interest
Annual
Collection
Costs
Total Annual
Installment
Due[b]
2026 $2,171.53$2,171.53)$
2027 691.03$2,927.90$247.71$271.10$4,137.74$
2028 730.90$2,887.06$244.25$276.52$4,138.73$
2029 770.76$2,843.87$240.60$282.05$4,137.28$
2030 817.28$2,798.32$236.74$287.69$4,140.03$
2031 863.79$2,750.02$232.66$293.44$4,139.90$
2032 910.30$2,698.97$228.34$299.31$4,136.92$
2033 963.46$2,645.17$223.79$305.30$4,137.71$
2034 1,016.61$2,588.23$218.97$311.40$4,135.21$
2035 1,076.41$2,528.14$213.89$317.63$4,136.08$
2036 1,136.21$2,464.53$208.50$323.99$4,133.23$
2037 1,209.30$2,397.38$202.82$330.46$4,139.97$
2038 1,275.75$2,325.91$196.78$337.07$4,135.51$
2039 1,348.84$2,250.51$190.40$343.82$4,133.56$
2040 1,428.57$2,170.80$183.65$350.69$4,133.71$
2041 1,514.95$2,086.37$176.51$357.71$4,135.54$
2042 1,607.97$1,996.83$168.94$364.86$4,138.60$
2043 1,701.00$1,901.80$160.90$372.16$4,135.85$
2044 1,800.66$1,801.27$152.39$379.60$4,133.93$
2045 1,913.62$1,694.85$143.39$387.19$4,139.06$
2046 2,026.58$1,581.76$133.82$394.94$4,137.09$
2047 2,146.18$1,461.99$123.69$402.83$4,134.69$
2048 2,279.07$1,335.15$112.96$410.89$4,138.07$
2049 2,411.96$1,200.46$101.56$419.11$4,133.09$
2050 2,558.14$1,057.91$89.50$427.49$4,133.04$
2051 2,717.61$906.72$76.71$436.04$4,137.08$
2052 2,883.72$746.11$63.12$444.76$4,137.72$
2053 3,056.48$575.69$48.70$453.66$4,134.53$
2054 3,242.52$395.05$33.42$462.73$4,133.72$
2055 3,441.86$203.41$17.21$471.99$4,134.47$
Total 49,541.53$57,393.71$2,171.53)$4,671.93$10,516.43$119,952.06$
Footnotes:
a]Interest is calculated at a 5.910%rate for illustrative purposes and shall be updated based on PID Bond
pricing.
b]The figures shown above are estimates only and subject to change in Annual Service Plan Updates.
Changes in Annual Collection Costs,reserve fund requirements,interest earnings,or other available
offsets could increase or decrease the amounts shown.
ANNUAL INSTALLMENTS IMPROVEMENT AREA 1 LOT TYPE 2
THIS PAGE IS LEFT BLANK INTENTIONALLY.
APPENDIX D
FORM OF OPINION OF BOND COUNSEL
Proposed Form of Opinion of Bond Counsel
An opinion in substantially the following form will be delivered by McCall, Parkhurst &
Horton L.L.P., Bond Counsel, upon the delivery of the Bonds, assuming no material
changes in facts or law.
CITY OF ANNA, TEXAS
SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2
IMPROVEMENT AREA #1 PROJECT)
IN THE AGGREGATE PRINCIPAL AMOUNT OF $__________
AS BOND COUNSEL for the City of Anna, Texas (the "Issuer"), we have examined
into the legality and validity of the issue of the bonds described above (the "Bonds"), which
bear interest from the date specified in the text of the Bonds, until maturity or prior
redemption, at the rates and payable on the dates as stated in the text of the Bonds, and
maturing and subject to redemption on the dates specified in the text of the Bonds, all in
accordance with the Ordinance authorizing the issuance of the Bonds (the "Bond
Ordinance") and the Trust Indenture (as defined below).
WE HAVE EXAMINED the applicable and pertinent provisions of the Constitution
and laws of the State of Texas, and have examined and relied upon a transcript of certified
proceedings of the Issuer and other pertinent instruments furnished by the Issuer relating to
the authorization, issuance and delivery of the Bonds; and we have examined various
certificates and documents executed by officers and officials of the Issuer upon which
certificates and documents we rely as to certain matters stated below. We have also
examined one executed Bond which we found to be in proper form and duly executed.
BASED ON SAID EXAMINATION, IT IS OUR OPINION that the Bonds have
been duly authorized, and have been duly issued and delivered, all in accordance with law,
and that, except as may be limited by laws relating to governmental immunity, bankruptcy,
reorganization, and other similar matters affecting creditors' rights or by general principles
of equity which permit the exercise of judicial discretion, (i) the Bonds constitute valid and
legally binding obligations of the Issuer which are payable as to principal and interest from
the sources provided in the Bond Ordinance and the Indenture of Trust between the Issuer
and Regions Bank, dated as of November 15, 2025 (the "Trust Indenture"), (ii) the covenants
and agreements in the Trust Indenture constitute valid and binding obligations of the Issuer,
iii) the Bonds constitute valid and legally binding special obligations of the Issuer secured
as Bonds under the Trust Indenture, and (iv) the Bonds are payable in accordance with the
priorities established in the Trust Indenture from the sources provided therein.
THE ISSUER has reserved the right, subject to the restrictions stated in the Trust
Indenture, to amend the Trust Indenture in the manner provided therein; and under some (but
not all) circumstances amendments thereto must be approved by the registered owners of a
majority in principal amount of all outstanding bonds affected by such amendment and
secured by the Trust Indenture.
THE REGISTERED OWNERS of the Bonds shall never have the right to demand
payment of the principal thereof or interest thereon out of any funds raised or to be raised by
taxation, or from any source whatsoever other than specified in the Trust Indenture.
IT IS FURTHER OUR OPINION, except as discussed below, that the interest on
the Bonds is excludable from the gross income of the owners thereof for federal income tax
purposes under the statutes, regulations, published rulings, and court decisions existing on
the date of this opinion. We are further of the opinion that the Bonds are not "specified
private activity bonds" and that, accordingly, interest on the Bonds will not be included as
an individual or corporate alternative minimum tax preference item under section 57(a)(5)
of the Internal Revenue Code of 1986 (the "Code"). In expressing the aforementioned
opinions, we have relied on certain representations, the accuracy of which we have not
independently verified, and assume compliance by the Issuer with certain covenants,
regarding the use and investment of the proceeds of the Bonds and the use of the property
financed and refinanced therewith. In expressing the aforementioned opinions, we have
relied on certain representations and covenants regarding the use and investment of the
proceeds of the Bonds. We call your attention to the fact that if such representations are
determined to be inaccurate or upon a failure by the Issuer to comply with such covenants,
interest on the Bonds may become includable in gross income retroactively to the date of
issuance of the Bonds.
EXCEPT AS STATED ABOVE, we express no opinion as to any other federal,
state, or local tax consequences of acquiring, carrying, owning, or disposing of the Bonds,
including the amount, accrual or receipt of interest on, the Bonds. Owners of the Bonds
should consult their tax advisors regarding the applicability of any collateral tax
consequences of owning the Bonds.
WE CALL YOUR ATTENTION TO THE FACT that the interest on tax-exempt
obligations, such as the Bonds, is includable in a corporation's adjusted financial statement
income for purposes of determining the alternative minimum tax imposed on certain
corporations by section 55 of the Code.
OUR OPINIONS ARE BASED ON EXISTING LAW, which is subject to change.
Such opinions are further based on our knowledge of facts as of the date hereof. We assume
no duty to update or supplement our opinions to reflect any facts or circumstances that may
thereafter come to our attention or to reflect any changes in any law that may thereafter occur
or become effective. Moreover, our opinions are not a guarantee of result and are not binding
on the Internal Revenue Service (the "Service"); rather, such opinions represent our legal
judgment based upon our review of existing law and in reliance upon the representations and
covenants referenced above that we deem relevant to such opinions. The Service has an
ongoing audit program to determine compliance with rules that relate to whether interest on
state or local obligations is includable in gross income for federal income tax purposes. No
assurance can be given whether or not the Service will commence an audit of the Bonds. If
an audit is commenced, in accordance with its current published procedures the Service is
likely to treat the Issuer as the taxpayer. We observe that the Issuer has covenanted not to
take any action, or omit to take any action within its control, that if taken or omitted,
respectively, may result in the treatment of interest on the Bonds as includable in gross
income for federal income tax purposes.
WE EXPRESS NO OPINION as to any insurance policies issued with respect to
the payments due for the principal of and interest on the Bonds, nor as to any such insurance
policies issued in the future.
OUR SOLE ENGAGEMENT in connection with the issuance of the Bonds is as
Bond Counsel for the Issuer, and, in that capacity, we have been engaged by the Issuer for
the sole purpose of rendering our opinions with respect to the legality and validity of the
Bonds under the Constitution and laws of the State of Texas, and with respect to the
exclusion from gross income of the interest on the Bonds for federal income tax purposes,
and for no other reason or purpose. The foregoing opinions represent our legal judgment
based upon a review of existing legal authorities that we deem relevant to render such
opinions and are not a guarantee of a result. We have not been requested to investigate or
verify, and have not independently investigated or verified, any records, data, or other
material relating to the financial condition or capabilities of the Issuer, or the disclosure
thereof in connection with the sale of the Bonds, and have not assumed any responsibility
with respect thereto. We express no opinion and make no comment with respect to the
marketability of the Bonds or with respect to the sufficiency of the Trust Estate pledged to
pay the Bonds. Our role in connection with the Issuer's Limited Offering Memorandum
prepared for use in connection with the sale of the Bonds has been limited as described
therein.
Respectfully,
THIS PAGE IS LEFT BLANK INTENTIONALLY.
APPENDIX E-1
FORM OF DISCLOSURE AGREEMENT OF ISSUER
Draft 10/8/2025
714154511v2
CITY OF ANNA, TEXAS,
SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2
IMPROVEMENT AREA #1 PROJECT)
CONTINUING DISCLOSURE AGREEMENT OF ISSUER
This Continuing Disclosure Agreement of Issuer, dated as of November 15, 2025 (this
Disclosure Agreement”), is executed and delivered by and among the City of Anna, Texas (the
Issuer”), P3Works, LLC (the “Administrator”), and Regions Bank, acting solely in its capacity as
dissemination agent (the “Dissemination Agent”), with respect to the Issuer’s “Special Assessment
Revenue Bonds, Series 2025 (Crystal Park Public Improvement District No. 2 Improvement Area #1
Project)” (the “Bonds”). The Issuer, the Administrator, and the Dissemination Agent covenant and agree
as follows:
SECTION 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being
executed and delivered by the Issuer, the Administrator, and the Dissemination Agent for the benefit of
the Owners (defined below) and beneficial owners of the Bonds. Unless and until a different filing
location is designated by the MSRB (defined below) or the SEC (defined below), all filings made by the
Dissemination Agent pursuant to this Disclosure Agreement shall be filed with the MSRB through
EMMA (defined below).
SECTION 2. Definitions. In addition to the definitions set forth above and in the Indenture
of Trust dated as of November 15, 2025, relating to the Bonds (the “Indenture”), which apply to any
capitalized term used in this Disclosure Agreement, including the Exhibits hereto, the following
capitalized terms shall have the following meanings:
Annual Collection Costs” shall have the meaning assigned to such term in the Indenture.
Annual Collections Report” shall mean any Annual Collections Report provided by the Issuer
pursuant to, and as described in, Section 5 of this Disclosure Agreement.
Annual Collections Report Filing Date” shall mean, for each Fiscal Year succeeding the
reporting Fiscal Year, the date that is three (3) months after the Final Assessment Payment Date, which
Annual Collections Report Filing Date is currently April 30.
Annual Financial Information” shall mean annual financial information as such term is used in
paragraph (b)(5)(i) of the Rule and specified in subsection 4(a) of this Disclosure Agreement.
Annual Financial Statements” shall mean audited or unaudited financial statements of the Issuer
prepared in accordance with generally accepted accounting principles for governmental units as
prescribed by the Government Accounting Standards Board from time to time, or such other accounting
principles as the Issuer may be required to employ from time to time pursuant to state law or regulation.
Annual Financials Filing Date” shall mean, for each Fiscal Year, the date on which the Annual
Financial Statements must be filed with the MSRB, which date is twelve (12) months after the end of the
Issuer’s Fiscal Year. The Annual Financials Filing Date is currently September 30.
2
Annual Information Filing Date” shall mean, for each Fiscal Year, the date on which the Annual
Financial Information must be filed with the MSRB, which date is six (6) months after the end of the
Issuer’s Fiscal Year. The Annual Information Filing Date is currently March 31.
Annual Installment” shall have the meaning assigned to “Improvement Area #1 Annual
Installment” in the Indenture.
Annual Service Plan Update” shall have the meaning assigned to such term in the Indenture.
Assessments” shall have the meaning assigned to “Improvement Area #1 Assessments” in the
Indenture.
Collections Reporting Date” shall mean, for each Tax Year, the date that is one (1) month after
the Delinquency Date, which Collections Reporting Date is currently March 1.
Delinquency Date” shall mean February 1 of the year following the year in which the
Assessments were billed or as may be otherwise defined in Section 31.02 of the Texas Tax Code, as
amended.
Developer” shall mean Bloomfield Homes, L.P., a Texas limited partnership, its designated
successors and assigns.
Disclosure Agreement of Developer” shall mean the Continuing Disclosure Agreement of
Developer relating to the Bonds, dated as of November 15, 2025, executed and delivered by the
Developer, the Administrator, and the Dissemination Agent.
Disclosure Representative” shall mean the Finance Director or City Manager of the Issuer or
his or her designee or such other officer or employee as the Issuer may designate in writing to the
Dissemination Agent from time to time.
Dissemination Agent” shall mean Regions Bank, acting solely in its capacity as dissemination
agent, or any successor Dissemination Agent designated in writing by the Issuer and which has filed
with the Trustee a written acceptance of such designation.
District” shall mean Crystal Park Public Improvement District No. 2.
EMMA” shall mean the Electronic Municipal Market Access system currently available on the
internet at http://emma.msrb.org.
Filing Date” means, collectively, an Annual Financials Filing Date, an Annual Information
Filing Date and an Annual Collections Report Filing Date, or, individually, as the context requires, an
Annual Financials Filing Date, an Annual Information Filing Date or an Annual Collections Report
Filing Date.
Final Assessment Payment Date” shall mean the calendar day preceding the Delinquency Date.
Financial Obligation” shall mean a (a) debt obligation; (b) derivative instrument entered into in
connection with, or pledged as security or a source of payment for, an existing or planned debt
3
obligation; or (c) guarantee of a debt obligation or any such derivative instrument; provided that
financial obligation” shall not include municipal securities (as defined in the Securities Exchange Act
of 1934, as amended) as to which a final official statement (as defined in the Rule) has been provided to
the MSRB consistent with the Rule.
Fiscal Year” shall mean the Issuer’s fiscal year, currently the twelve-month period from
October 1 through September 30.
Improvement Area #1” shall have the meaning assigned to such term in the Indenture.
Listed Events” shall mean any of the events listed in subsection 6(a) of this Disclosure
Agreement.
MSRB” shall mean the Municipal Securities Rulemaking Board or any other entity designated
or authorized by the SEC to receive continuing disclosure reports pursuant to the Rule.
Participating Underwriter” shall mean FMSbonds, Inc., and its successors and assigns.
Rule” shall mean Rule 15c2-12 adopted by the SEC under the Securities Exchange Act of 1934,
as the same may be amended from time to time.
SEC” shall mean the United States Securities and Exchange Commission.
Service and Assessment Plan” shall have the meaning assigned to such term in the Indenture.
Tax Year” means the calendar year, or as may be otherwise defined in Section 1.04 of the Texas
Tax Code, as amended.
SECTION 3. Provision of Annual Financial Information and Audited Financial Statements.
a) For each Fiscal Year, commencing with the Fiscal Year ending September 30, 2026, the
Issuer shall cause, pursuant to written direction, and hereby directs the Dissemination Agent to provide
or cause to be provided to the MSRB, in the electronic or other format required by the MSRB, the Annual
Financial Information and the Annual Financial Statements.
i) The Issuer shall provide or caused to be provided the Annual Financial
Information to the MSRB not later than the Annual Information Filing Date; and
ii) The Issuer shall provide or caused to be provided audited Annual Financial
Statements to the MSRB not later than the Annual Financials Filing Date, or if audited Annual
Financial Statements are not available by the Annual Financials Filing Date, unaudited Annual
Financial Statements, provided to the Dissemination Agent which is consistent with the
requirements specified in Section 4 of this Disclosure Agreement.
In each case, the Annual Financial Information and Annual Financial Statements may include by
reference other information as provided in Section 4 of this Disclosure Agreement. If the Issuer’s Fiscal
Year changes, it shall file notice of such change (including the date of the new Fiscal Year) with the
4
MSRB prior to the next Annual Information Filing Date. All documents provided to the MSRB shall be
accompanied by identifying information as prescribed by the MSRB.
b) Not later than ten (10) days prior to the applicable Filing Date, the Issuer shall provide
the Annual Financial Information or Annual Financial Statements, as applicable, to the Dissemination
Agent together with written direction to file such Annual Financial Information or Annual Financial
Statements with the MSRB. The Dissemination Agent shall provide such Annual Financial Information
or Annual Financial Statements to the MSRB not later than ten (10) days from receipt of such Annual
Financial Information or Annual Financial Statements from the Issuer, but in no event later than the
applicable Filing Date for such Fiscal Year.
If by the fifth (5th) day before the applicable Filing Date, the Dissemination Agent has not
received a copy of the Annual Financial Information or Annual Financial Statements, as applicable, the
Dissemination Agent shall contact the Disclosure Representative in writing (which may be by e-mail) to
remind the Issuer of its undertaking to provide the applicable Annual Financial Information or Annual
Financial Statements pursuant to subsection (a). Upon such reminder, the Disclosure Representative
shall either (i) provide the Dissemination Agent with an electronic copy of the Annual Financial
Information or Annual Financial Statements, as applicable, no later than two (2) Business Days prior to
the applicable Filing Date; or (ii) instruct the Dissemination Agent in writing that the Issuer will not be
able to provide the Annual Financial Information by the Annual Information Filing Date or the Annual
Financial Statements by the Annual Financials Filing Date, as applicable, state the date by which the
Annual Financial Information or Annual Financial Statements for such year will be provided and instruct
the Dissemination Agent to immediately send a notice to the MSRB in substantially the form attached
as Exhibit A; provided, however, that in the event the Disclosure Representative is required to act under
either (i) or (ii) described above, the Dissemination Agent still must file the Annual Financial
Information, Annual Financial Statements or the notice of failure to file, as applicable, to the MSRB, no
later than the applicable Filing Date; provided further, however, that in the event the Disclosure
Representative fails to act under either (i) or (ii) described above, the Dissemination Agent shall file a
notice of failure to file no later than the applicable Filing Date.
c) The Dissemination Agent, pursuant to written direction, shall:
i) determine the filing address or other filing location of the MSRB each year prior
to filing the Annual Financial Information and the Annual Financial Statements on the dates
required in subsection (a);
ii) on behalf of the Issuer, file the Annual Financial Information and the Annual
Financial Statements containing or incorporating by reference the information set forth in Section
4 hereof; and
iii) if the Issuer has provided the Dissemination Agent with the completed Annual
Financial Information and the Annual Financial Statements, as applicable, and the Dissemination
Agent has filed such Annual Financial Information or Annual Financial Statements with the
MSRB, then the Dissemination Agent shall file a report with the Issuer certifying that the Annual
Financial Information or Annual Financial Statements has been provided pursuant to this
Disclosure Agreement, stating the date it was provided and that it was filed with the MSRB.
5
SECTION 4. Content and Timing of Annual Financial Information and Annual Financial
Statements.
a) Annual Financial Information. The Annual Financial Information for the Bonds shall
contain or incorporate by reference, and the Issuer agrees to provide or cause to be provided to the
Dissemination Agent to file by the Annual Information Filing Date, the following Annual Financial
Information (any or all of which may be unaudited):
i) Information regarding the Bonds and the Trustee in substantially similar form to
that shown in the tables provided under Section 4(a)(i) of Exhibit B attached hereto. Such
information shall be provided as of the end of the Fiscal Year to which the information being
reported relates;
ii) Financial information and operating data with respect to the Issuer of the general
type and in substantially similar form to that shown in the tables provided under Section 4(a)(ii)
of Exhibit B attached hereto. Such information shall be provided as of the end of the Fiscal Year
to which the information being reported relates;
iii) Any updates to the Service and Assessment Plan, including the Annual Service
Plan Update; and
iv) A description of any amendment to this Disclosure Agreement and a copy of any
restatements to the Issuer’s audited financial statements during such Fiscal Year.
b) Annual Financial Statements. The Issuer agrees to provide or cause to be provided to the
Dissemination Agent to file by the Annual Financials Filing Date the audited Annual Financial
Statements of the Issuer for the most recently ended Fiscal Year, prepared in accordance with generally
accepted accounting principles applicable from time to time to the Issuer. If the audited Annual Financial
Statements of the Issuer are not available by the Annual Financials Filing Date, the Issuer shall provide
unaudited Annual Financial Statements of the Issuer no later than the Annual Financials Filing Date and
audited Annual Financial Statements when and if available.
c) See Exhibit B hereto for a form for submitting the information set forth in subsection 4(a)
above. The Issuer has designated P3Works, LLC as the initial Administrator. The Administrator, and if
no Administrator is designated, Issuer’s staff, shall prepare the Annual Financial Information. In all
cases, the Issuer shall have the sole responsibility for the content, design and other elements comprising
substantive contents of the Annual Financial Information under this Section 4.
Any or all of the items listed above may be included by specific reference to other documents,
including disclosure documents of debt issues of the Issuer, which have been submitted to and are
publicly accessible from the MSRB. If the document included by reference is a final offering document,
it must be available from the MSRB. The Issuer shall clearly identify each such other document so
included by reference. The Dissemination Agent has no duty or obligation to determine whether or not
the information contained in any completed forms containing financial information and operating data
as shown in Exhibit B provided to it has been accurately completed and shall only be required to file the
forms as completed and provided to it by either the Administrator or the Issuer.
6
SECTION 5. Annual Collections Report.
a) For each Fiscal Year succeeding the reporting Fiscal Year, the Issuer shall cause, pursuant
to written direction, and hereby directs the Dissemination Agent to provide or cause to be provided to
the MSRB, in the electronic or other format required by the MSRB, not later than the Annual Collections
Report Filing Date, an Annual Collections Report provided to the Dissemination Agent which complies
with the requirements specified in this Section 5; provided that the Issuer may provide the Annual
Collections Report as part of the Annual Financial Information, if such Annual Collections Report is
available when the Annual Financial Information is provided to the MSRB. All documents provided to
the MSRB shall be accompanied by identifying information as prescribed by the MSRB.
Not later than ten (10) days prior to the Annual Collections Report Filing Date, the Issuer shall
provide the Annual Collections Report to the Dissemination Agent together with written direction to file
such Annual Collections Report with the MSRB. The Dissemination Agent shall provide such Annual
Collections Report to the MSRB not later than ten (10) days from receipt of such Annual Collections
Report from the Issuer, but in no event later than the Annual Collections Report Filing Date.
If by the fifth (5th) day before the Annual Collections Report Filing Date, the Dissemination
Agent has not received a copy of the Annual Collections Report, the Dissemination Agent shall contact
the Disclosure Representative in writing (which may be by e-mail) to remind the Issuer of its undertaking
to provide the applicable Annual Collections Report pursuant to this subsection 5(a). Upon such
reminder, the Disclosure Representative shall either (i) provide the Dissemination Agent with an
electronic copy of the Annual Collections Report no later than two (2) Business Days prior to the Annual
Collections Report Filing Date or (ii) instruct the Dissemination Agent in writing that the Issuer will not
be able to provide the Annual Collections Report by the Annual Collections Report Filing Date, state the
date by which the Annual Collections Report for such year will be provided and instruct the
Dissemination Agent to immediately send a notice to the MSRB in substantially the form attached hereto
as Exhibit A; provided, however, that in the event the Disclosure Representative is required to act under
either (i) or (ii) described above, the Dissemination Agent still must file the Annual Collections Report
or the notice of failure to file, as applicable, to the MSRB, no later than the Annual Collections Report
Filing Date; provided further, however, that in the event the Disclosure Representative fails to act under
either (i) or (ii) described above, the Dissemination Agent shall file a notice of failure to file no later
than on the last Business Day prior to the Annual Collections Report Filing Date; or the Issuer will notify
the Dissemination Agent in writing that the Issuer will provide or cause to be provided the Annual
Collections Report to the MSRB through alternate means. If the Issuer so notifies the Dissemination
Agent, the Issuer will provide the Dissemination Agent with a written report certifying that the Annual
Collections Report has been provided to the MSRB pursuant to this Disclosure Agreement, stating the
date it was provided and that it was filed with the MSRB prior to the second (2nd) Business Day prior
to the Annual Collections Report Filing Date. In the event the Issuer fails to provide the Dissemination
Agent with such a report, the Dissemination Agent shall file a notice of failure to file no later than the
applicable Annual Collections Report Filing Date.
b) The Annual Collections Report for the Bonds shall contain, and the Issuer agrees to
provide or cause to be provided to the Dissemination Agent to file by the Annual Collections Report
Filing Date, certain financial information and operating data with respect to collection of the
Assessments of the general type and in substantially similar form to that shown in the tables provided in
Exhibit C attached hereto. Such information shall cover the period beginning the first (1st) day of the
7
Fiscal Year succeeding the reporting Fiscal Year through the Collections Reporting Date. If the State
Legislature amends the definition of Delinquency Date or Tax Year, the Issuer shall file notice of such
change or changes with the MSRB prior to the next Annual Collections Report Filing Date. The
Administrator, and if no Administrator is designated, Issuer’s staff, shall prepare the Annual Collections
Report. In all cases, the Issuer shall have the sole responsibility for the content, design, and other
elements comprising substantive contents of the Annual Collections Report under this Section 5.
SECTION 6. Reporting of Significant Events.
a) Pursuant to the provisions of this Section 6, each of the following is a Listed Event with
respect to the Bonds:
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 IRS of proposed or final determinations of
taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or
determinations with respect to the tax status of the Bonds, or other material events affecting the
tax status of the Bonds.
7. Modifications to rights of Owners, 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.
13. The consummation of a merger, consolidation, or acquisition of 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.
14. Appointment of a successor or additional trustee under the Indenture or the change of
name of a trustee, if material.
8
15. Incurrence of a Financial Obligation of the Issuer, if material, or agreement to
covenants, events of default, remedies, priority rights, or other similar terms of a Financial
Obligation of the Issuer, 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 Issuer, any of which reflect
financial difficulties.
Any sale by the Developer of real property within Improvement Area #1 will not constitute a
Listed Event for the purposes of paragraph (10) above.
For these purposes, any event described in paragraph (12) above 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 United States Bankruptcy Code or in any other proceeding under state or federal
law in which a court or governmental authority has assumed jurisdiction over substantially all of the
assets or business of the 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.
The Issuer intends the words used in paragraphs (15) and (16) above and the definition of
Financial Obligation to have the same meanings as when they are used in the Rule, as evidenced by SEC
Release No. 34-83885, dated August 20, 2018. For the avoidance of doubt, the incurrence of Additional
Obligations without the filing of a corresponding official statement with the MSRB will constitute the
incurrence of a material Financial Obligation for which a notice of a Listed Event in accordance with
this Section 6 must be filed with the MSRB.
Upon the occurrence of a Listed Event, the Issuer shall promptly notify the Dissemination Agent
in writing and the Issuer shall direct the Dissemination Agent in writing to immediately file a notice of
such occurrence with the MSRB. The Dissemination Agent shall file such notice no later than the
Business Day immediately following the day on which it receives written notice of such occurrence from
the Issuer. Any such notice is required to be filed within ten (10) Business Days of the occurrence of
such Listed Event; provided, however, the failure of the Issuer to provide timely written notice to the
Dissemination Agent in accordance with this paragraph shall not constitute a failure of the Dissemination
Agent to comply with the MSRB’s ten (10) Business Day filing requirement.
Any notice under the preceding paragraphs shall be accompanied with the text of the disclosure
that the Issuer desires to make, the written authorization of the Issuer for the Dissemination Agent to
disseminate such information as provided herein, and the date the Issuer desires for the Dissemination
Agent to disseminate the information.
In all cases, the Issuer shall have the sole responsibility for the content, design and other elements
comprising substantive contents of all disclosures made under this Section 6. In addition, the Issuer shall
have the sole responsibility to ensure that any notice required to be filed under this Section 6 is filed
within ten (10) Business Days of the occurrence of the Listed Event.
9
b) The Dissemination Agent shall, promptly, and not more than five (5) Business Days after
obtaining actual knowledge of the occurrence of any Listed Event with respect to the Bonds, notify the
Disclosure Representative in writing of such Listed Event. The Dissemination Agent shall not be
required to file a notice of the occurrence of such Listed Event with the MSRB unless and until it receives
written instructions from the Disclosure Representative to do so. If the Dissemination Agent has been
instructed in writing by the Disclosure Representative on behalf of the Issuer to report the occurrence of
a Listed Event under this subsection (b), the Dissemination Agent shall file a notice of such occurrence
with the MSRB no later than two (2) Business Days following the day on which it receives such written
instructions. It is agreed and understood that the duty to make or cause to be made the disclosures herein
is that of the Issuer and not that of the Dissemination Agent. It is agreed and understood that the
Dissemination Agent has agreed to give the foregoing notice to the Issuer as an accommodation to assist
it in monitoring the occurrence of such event, but is under no obligation to investigate whether any such
event has occurred. As used above, “actual knowledge” means the actual fact or statement of knowing,
without a duty to make any investigation with respect thereto. In no event shall the Dissemination Agent
be liable in damages or in tort to the Issuer, the Participating Underwriter, the Trustee, or any Owner or
beneficial owner of any interests in the Bonds, or any other party as a result of its failure to give the
foregoing notice or to give such notice in a timely fashion.
c) If in response to a notice from the Dissemination Agent under subsection (b), the Issuer
determines that the Listed Event under number 2, 7, 8 (as to bond calls only), 10, 13, 14, or 15 of
subparagraph (a) above is not material under applicable federal securities laws, the Issuer shall promptly,
but in no case more than five (5) Business Days after the occurrence of the event, notify the
Dissemination Agent and the Trustee (if the Dissemination Agent is not the Trustee) in writing and
instruct the Dissemination Agent not to report the occurrence pursuant to subsection (b).
SECTION 7. Termination of Reporting Obligations. The obligations of the Issuer, the
Administrator, and the Dissemination Agent under this Disclosure Agreement shall terminate upon the
legal defeasance, prior redemption or payment in full of all of the Bonds, when the Issuer is no longer
an obligated person with respect to the Bonds, or upon delivery by the Disclosure Representative to the
Dissemination Agent and the Administrator of an opinion of nationally recognized bond counsel to the
effect that continuing disclosure is no longer required. So long as any of the Bonds remain Outstanding,
the Administrator and the Dissemination Agent may assume that the Issuer is an obligated person with
respect to the Bonds until they receive written notice from the Disclosure Representative stating that the
Issuer is no longer an obligated person with respect to the Bonds, and the Dissemination Agent and the
Administrator may conclusively rely upon such written notice with no duty to make investigation or
inquiry into any statements contained or matters referred to in such written notice. If such termination
occurs prior to the final maturity of the Bonds, the Issuer shall give notice of such termination in the
same manner as for a Listed Event with respect to the Bonds under Section 6(a).
SECTION 8. Dissemination Agent. The Issuer may, from time to time, appoint or engage
a Dissemination Agent or successor Dissemination Agent to assist it in carrying out its obligations under
this Disclosure Agreement, and may discharge such Dissemination Agent, with or without appointing a
successor Dissemination Agent. If the Issuer discharges the Dissemination Agent without appointing a
successor Dissemination Agent, the Issuer shall use best efforts to appoint a successor Dissemination
Agent within thirty (30) days of such discharge. If at any time there is not any other designated
Dissemination Agent, the Issuer shall be the Dissemination Agent. The initial Dissemination Agent
appointed hereunder shall be Regions Bank. The Issuer will give prompt written notice to the Developer,
10
or any other party responsible for providing quarterly information pursuant to the Disclosure Agreement
of Developer, of any change in the identity of the Dissemination Agent under the Disclosure Agreement
of Developer. The Dissemination Agent may resign at any time with thirty (30) days’ written notice to
the Issuer.
SECTION 9. Amendment; Waiver. Notwithstanding any other provisions of this
Disclosure Agreement, the Issuer, the Administrator, and the Dissemination Agent may amend this
Disclosure Agreement (and the Dissemination Agent shall not unreasonably withhold its consent to any
amendment so requested in writing by the Issuer or the Administrator), and any provision of this
Disclosure Agreement may be waived, provided that the following conditions are satisfied:
a) If the amendment or waiver relates to the provisions of Sections 3(a), 4, 5, or 6(a), it may
only be made in connection with a change in circumstances that arises from a change in legal
requirements, change in law, or change in the identity, nature or status of an obligated person with respect
to the Bonds, or the type of business conducted;
b) The undertaking, as amended or taking into account such waiver, would, in the opinion
of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of
the delivery of the Bonds, after taking into account any amendments or interpretations of the Rule, as
well as any change in circumstances; and
c) The amendment or waiver either (i) is approved by the Owners of the Bonds in the same
manner as provided in the Indenture for amendments to the Indenture with the consent of Owners, or
ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the
Owners or beneficial owners of the Bonds.
In the event of any amendment or waiver of a provision of this Disclosure Agreement, the Issuer
shall describe such amendment in the next related Annual Financial Information, and shall include, as
applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type
or in the case of a change of accounting principles, on the presentation) of financial information or
operating data being presented by the Issuer. In addition, if the amendment relates to the accounting
principles to be followed in preparing financial statements, (i) notice of such change shall be given in
the same manner as for a Listed Event under Section 6(a), and (ii) the Annual Financial Information for
the Fiscal Year in which the change is made should present a comparison (in narrative form and also, if
feasible, in quantitative form) between the financial statements as prepared on the basis of the new
accounting principles and those prepared on the basis of the former accounting principles. No
amendment which adversely affects the Dissemination Agent may be made without its prior written
consent (which consent will not be unreasonably withheld or delayed).
SECTION 10. Additional Information. Nothing in this Disclosure Agreement shall be
deemed to prevent the Issuer from disseminating any other information, using the means of
dissemination set forth in this Disclosure Agreement or any other means of communication, or including
any other information in any Annual Financial Information, Annual Financial Statements, Annual
Collections Report or notice of occurrence of a Listed Event, in addition to that which is required by this
Disclosure Agreement. If the Issuer chooses to include any information in any Annual Financial
Information, Annual Financial Statements, Annual Collections Report or notice of occurrence of a Listed
Event in addition to that which is specifically required by this Disclosure Agreement, the Issuer shall
11
have no obligation under this Disclosure Agreement to update such information or include it in any
future Annual Financial Information, Annual Financial Statements, Annual Collections Report or notice
of occurrence of a Listed Event.
SECTION 11. Default. In the event of a failure of the Issuer to comply with any provision
of this Disclosure Agreement, the Dissemination Agent or any Owner or beneficial owner of the Bonds
may, and the Dissemination Agent (at the written request of any Participating Underwriter or the Owners
of at least twenty-five percent (25%) aggregate principal amount of Outstanding Bonds and upon being
indemnified to its satisfaction) shall, take such actions as may be necessary and appropriate to cause the
Issuer to comply with its obligations under this Disclosure Agreement. A default under this Disclosure
Agreement shall not be deemed an Event of Default under the Indenture with respect to the Bonds, and
the sole remedy under this Disclosure Agreement in the event of any failure of the Issuer to comply with
this Disclosure Agreement shall be an action for mandamus or specific performance. A default under
this Disclosure Agreement shall not be deemed a default under the Disclosure Agreement of Developer
and a default under the Disclosure Agreement of Developer shall not be deemed a default under this
Disclosure Agreement.
SECTION 12. Duties, Immunities and Liabilities of Dissemination Agent and Administrator.
a) The Dissemination Agent shall not have any duty with respect to the content of any
disclosures made pursuant to the terms hereof. The Dissemination Agent shall have only such duties as
are specifically set forth in this Disclosure Agreement, and no implied covenants shall be read into this
Disclosure Agreement with respect to the Dissemination Agent. To the extent permitted by law, the
Issuer agrees to indemnify and hold harmless the Dissemination Agent, its officers, directors, employees
and agents, but only from Annual Collection Costs collected from the property owners in Improvement
Area #1, against any loss, expense and liabilities which it may incur arising out of or in the exercise or
performance of its powers and duties hereunder, including the costs and expenses (including attorneys’
fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination
Agent’s negligence or willful misconduct; provided, however, that nothing herein shall be construed to
require the Issuer to indemnify the Dissemination Agent for losses, expenses or liabilities arising from
information provided to the Dissemination Agent by the Developer or the failure of the Developer to
provide information to the Dissemination Agent as and when required under the Disclosure Agreement
of Developer. The obligations of the Issuer under this Section shall survive resignation or removal of the
Dissemination Agent and payment in full of the Bonds. Nothing in this Disclosure Agreement shall be
construed to mean or to imply that the Dissemination Agent is an “obligated person” under the Rule. If
the Issuer does not provide the Dissemination Agent with the Annual Financial Information or Annual
Financial Statements in accordance with Section 4(a) and 4(b), respectively, or the Annual Collections
Report in accordance with Section 5(a), the Dissemination Agent shall not be responsible for the failure
to submit Annual Financial Information, Annual Financial Statements, or the Annual Collections Report,
as applicable, to the MSRB. The Dissemination Agent is not acting in a fiduciary capacity in connection
with the performance of its respective obligations hereunder.
The Dissemination Agent may, from time to time, consult with legal counsel of its own choosing
in the event of any disagreement or controversy, or question or doubt as to the construction of any of the
provisions hereof or its duties hereunder, and the Dissemination Agent shall not incur any liability and
shall be fully protected in acting in good faith upon the advice of such legal counsel.
12
The Issuer, the Administrator and the Dissemination Agent agree that the legal expenses of the
Dissemination Agent, which it is expressly entitled to be paid under this paragraph 12(a), are expenses
which may be paid from the Annual Collection Costs.
b) The Administrator shall not have any duty with respect to the content of any disclosures
made pursuant to the terms hereof. The Administrator shall have only such duties as are specifically set
forth in this Disclosure Agreement, and no implied covenants shall be read into this Disclosure
Agreement with respect to the Administrator. To the extent permitted by law, the Issuer agrees to hold
harmless the Administrator, its officers, directors, employees and agents, but only from Annual
Collection Costs collected from the property owners in Improvement Area #1, against any loss, expense
and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties
hereunder, including the costs and expenses (including reasonable attorneys’ fees) of defending against
any claim of liability, but excluding liabilities due to the Administrator’s negligence or willful
misconduct; provided, however, that nothing herein shall be construed to require the Issuer to indemnify
the Administrator for losses, expenses or liabilities arising from information provided to the
Administrator by third parties, or the failure of any third party to provide information to the
Administrator as and when required under this Disclosure Agreement, or the failure of the Developer to
provide information to the Administrator as and when required under the Disclosure Agreement of
Developer. The obligations of the Issuer under this Section shall survive resignation or removal of the
Administrator and payment in full of the Bonds. Nothing in this Disclosure Agreement shall be construed
to mean or to imply that the Administrator is an “obligated person” under the Rule. The Administrator
is not acting in a fiduciary capacity in connection with the performance of its respective obligations
hereunder. The Administrator shall not in any event incur any liability with respect to (i) any action taken
or omitted to be taken in good faith upon advice of legal counsel given with respect to any question
relating to duties and responsibilities of the Administrator hereunder, or (ii) any action taken or omitted
to be taken in reliance upon any document delivered to the Administrator and believed to be genuine and
to have been signed or presented by the proper party or parties.
The Administrator may, from time to time, consult with legal counsel of its own choosing in the
event of any disagreement or controversy, or question or doubt as to the construction of any of the
provisions hereof or its duties hereunder, and the Administrator shall not incur any liability and shall be
fully protected in acting in good faith upon the advice of such legal counsel.
The Issuer, the Administrator and the Dissemination Agent agree that the legal expenses of the
Administrator, which it is expressly entitled to be paid under this paragraph 12(b), are expenses which
may be paid from the Annual Collection Costs.
c) UNDER NO CIRCUMSTANCES SHALL THE DISSEMINATION AGENT, THE
ADMINISTRATOR, OR THE ISSUER BE LIABLE TO THE OWNER OR BENEFICIAL OWNER
OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT, FOR DAMAGES
RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY ANY PARTY TO THIS
DISCLOSURE AGREEMENT, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF
ANY COVENANT SPECIFIED IN THIS DISCLOSURE AGREEMENT, BUT EVERY RIGHT AND
REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY
SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC
PERFORMANCE. THE DISSEMINATION AGENT AND THE ADMINISTRATOR ARE UNDER
NO OBLIGATION NOR ARE THEY REQUIRED TO BRING SUCH AN ACTION.
13
SECTION 13. Assessment Timeline. The basic expected timeline for the collection of
Assessments and the anticipated procedures for pursuing the collection of delinquent Assessments is set
forth in Exhibit D which is intended to illustrate the general procedures expected to be followed in
enforcing the payment of delinquent Assessments. Failure to adhere to such expected timeline shall not
constitute a default by the Issuer under this Disclosure Agreement, the Indenture, the Bonds, or any other
document related to the Bonds.
SECTION 14. No Personal Liability. No covenant, stipulation, obligation or agreement of
the Issuer, the Administrator, or the Dissemination Agent contained in this Disclosure Agreement shall
be deemed to be a covenant, stipulation, obligation or agreement of any present or future council
members, officer, agent or employee of the Issuer, the Administrator, or the Dissemination Agent in
other than that person’s official capacity.
SECTION 15. Severability. In case any section or provision of this Disclosure Agreement,
or any covenant, stipulation, obligation, agreement, act or action, or part thereof made, assumed, entered
into, or taken thereunder or any application thereof, is for any reason held to be illegal or invalid, such
illegality or invalidity shall not affect the remainder thereof or any other section or provision thereof or
any other covenant, stipulation, obligation, agreement, act or action, or part thereof made, assumed,
entered into, or taken thereunder (except to the extent that such remainder or section or provision or
other covenant, stipulation, obligation, agreement, act or action, or part thereof is wholly dependent for
its operation on the provision determined to be invalid), which shall be construed and enforced as if such
illegal or invalid portion were not contained therein, nor shall such illegality or invalidity of any
application thereof affect any legal and valid application thereof, and each such section, provision,
covenant, stipulation, obligation, agreement, act or action, or part thereof shall be deemed to be effective,
operative, made, entered into or taken in the manner and to the full extent permitted by law.
SECTION 16. Sovereign Immunity. The Dissemination Agent and the Administrator agree
that nothing in this Disclosure Agreement shall constitute or be construed as a waiver of the Issuer’s
sovereign or governmental immunities regarding liability or suit.
SECTION 17. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of
the Issuer, the Administrator, the Dissemination Agent, the Participating Underwriter, and the Owners
and the beneficial owners from time to time of the Bonds, and shall create no rights in any other person
or entity. Nothing in this Disclosure Agreement is intended or shall act to disclaim, waive or otherwise
limit the duties of the Issuer under federal and state securities laws.
SECTION 18. Dissemination Agent and Administrator Compensation. The fees and
expenses incurred by the Dissemination Agent and the Administrator for their respective services
rendered in accordance with this Disclosure Agreement constitute Annual Collection Costs and will be
included in the Annual Installments as provided in the annual updates to the Service and Assessment
Plan. The Issuer shall pay or reimburse the Dissemination Agent and the Administrator, but only with
funds to be provided from the Annual Collection Costs component of the Annual Installments collected
from the property owners in Improvement Area #1, for the fees and expenses for their respective services
rendered in accordance with this Disclosure Agreement.
SECTION 19. Statutory Verifications. The Dissemination Agent and the Administrator each
respectively make the following representations and verifications pursuant to Chapters 2252, 2271, 2274,
14
and 2276, Texas Government Code, as heretofore amended (the “Government Code”), in entering into
this Disclosure Agreement. As used in such verifications, “affiliate” means an entity that controls, is
controlled by, or is under common control with the Dissemination Agent or the Administrator, as
applicable, within the meaning of SEC Rule 405, 17 C.F.R. § 230.405, and exists to make a profit.
Liability for breach of any such verification during the term of this Disclosure Agreement shall survive
until barred by the applicable statute of limitations, and shall not be liquidated or otherwise limited by
any provision of this Disclosure Agreement, notwithstanding anything in this Disclosure Agreement to
the contrary.
a) Not a Sanctioned Company. The Dissemination Agent and Administrator each
respectively represents that neither it nor any of its parent company, wholly- or majority-owned
subsidiaries, and other affiliates is a company identified on a list prepared and maintained by the Texas
Comptroller of Public Accounts under Section 2252.153 or Section 2270.0201, Government Code. The
foregoing representation excludes the Dissemination Agent, Administrator and each of their respective
parent company, wholly- or majority-owned subsidiaries, and other affiliates, if any, that the United
States government has affirmatively declared to be excluded from its federal sanctions regime relating
to Sudan or Iran or any federal sanctions regime relating to a foreign terrorist organization.
b) No Boycott of Israel. The Dissemination Agent and Administrator each respectively
hereby verifies that it and its parent company, wholly- or majority-owned subsidiaries, and other
affiliates, if any, do not boycott Israel and will not boycott Israel during the term of this Disclosure
Agreement. As used in the foregoing verification, “boycott Israel” has the meaning provided in Section
2271.001, Government Code.
c) No Discrimination Against Firearm Entities. The Dissemination Agent and the
Administrator each respectively hereby verifies that it and its parent company, wholly- or majority-
owned subsidiaries, and other affiliates, if any, do not have a practice, policy, guidance, or directive that
discriminates against a firearm entity or firearm trade association and will not discriminate against a
firearm entity or firearm trade association during the term of this Disclosure Agreement. As used in the
foregoing verification, “discriminate against a firearm entity or firearm trade association” has the
meaning provided in Section 2274.001(3), Government Code.
d) No Boycott of Energy Companies. The Dissemination Agent and Administrator each
respectively hereby verifies that it and its parent company, wholly- or majority-owned subsidiaries, and
other affiliates, if any, do not boycott energy companies and will not boycott energy companies during
the term of this Disclosure Agreement. As used in the foregoing verification, “boycott energy
companies” has the meaning provided in Section 2276.001(1), Government Code.
SECTION 20. Disclosure of Interested Parties. Pursuant to Section 2252.908(c)(4), Texas
Government Code, as amended, the Dissemination Agent hereby certifies it is a publicly traded business
entity and is not required to file a Certificate of Interested Parties Form 1295 related to this Disclosure
Agreement. Submitted herewith is a completed Form 1295 in connection with the Administrator’s
participation in the execution of this Disclosure Agreement generated by the Texas Ethics Commission’s
the “TEC”) electronic filing application in accordance with the provisions of Section 2252.908 of the
Texas Government Code and the rules promulgated by the TEC (the “Form 1295”). The Issuer hereby
confirms receipt of the Form 1295 from the Administrator and the Issuer agrees to acknowledge such
form with the TEC through its electronic filing application not later than the thirtieth (30th) day after the
15
receipt of such form. The Administrator and the Issuer understand and agree that, with the exception of
information identifying the Issuer and the contract identification number, neither the Issuer nor its
consultants are responsible for the information contained in the Form 1295; that the information
contained in the Form 1295 has been provided solely by the Administrator; and, neither the Issuer nor
its consultants have verified such information.
SECTION 21. Notice. Any written notice required to be given or made hereunder among or
between any of the Issuer, the Trustee, the Administrator, the Dissemination Agent and/or Participating
Underwriter, shall be given or made by e-mail, hand delivery, overnight courier, or by United States
mail, certified or registered mail, return receipt requested, postage prepaid, at the addresses listed below
or at such other addresses as any be specified in writing by any party hereto to the other parties hereto.
If the required notice is provided or delivered by e-mail, the sender must request a read or delivery receipt
from the recipient confirming that the recipient received the e-mail or the e-mail was delivered with such
notice. Failure of any party to this Disclosure Agreement to provide proof of an e-mail read receipt or
delivery receipt does not constitute a breach or default by such under this Disclosure Agreement.
If to the Trustee or
Dissemination A ent: Re ions Ban
Attn: Corporate Trust Services
1717 McKinne Avenue
Dallas, Texas 75202
Email: Shawn.bednasek re ions.com
If to Administrato : P3Works, LLC
9284 Huntin ton Square, Ste 100
North Richland Hills, Texas 76182
Email: admin p3-works.com
If to the Issuer: Cit of Anna
Attn: Cit Mana e
120 W. 7th Street
Anna, Texas 75409
Email: mmarchand annatexas.ov
If to Participatin Underwriter: FMSbonds, Inc.
5 Cowbo s Wa , Suite 300-25
Frisco, Texas 75034
E-mail: Tdavenport fmsbonds.com
SECTION 22. Governing Law. This Disclosure Agreement shall be governed by the laws of
the State of Texas.
SECTION 23. Counterparts. This Disclosure Agreement 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. The Issuer, the Administrator, and the Dissemination Agent agree that electronic signatures
to this Disclosure Agreement may be regarded as original signatures.
SIGNATURE PAGE OF CONTINUING DISCLOSURE AGREEMENT OF ISSUER
CITY OF ANNA, TEXAS
B :
Ma o
SIGNATURE PAGE OF CONTINUING DISCLOSURE AGREEMENT OF ISSUER
Re ions Ban
as Dissemination A ent)
B :
Authorized Office
SIGNATURE PAGE OF CONTINUING DISCLOSURE AGREEMENT OF ISSUER
P3Works, LLC
as Administrator)
B :
Authorized Office
A-1
EXHIBIT A
NOTICE TO MSRB OF FAILURE TO FILE
ANNUAL FINANCIAL INFORMATION][ANNUAL COLLECTIONS REPORT]
AUDITED/UNAUDITED ANNUAL FINANCIAL STATEMENTS]
Name of Issuer: Cit of Anna, Texas
Name of Bond Issue: Special Assessment Revenue Bonds, Series 2025
Crystal Park Public Improvement District No. 2 Improvement Area
1 Pro ect) (the “Bonds”)
CUSIP Nos. [insert CUSIP NOs.]
Date of Deliver : , 20
NOTICE IS HEREBY GIVEN that the City of Anna, Texas (the “Issuer”), has not provided
an Annual Financial Information][an Annual Collections Report][audited/unaudited Annual
Financial Statements] with respect to the Bonds as required by the Continuing Disclosure
Agreement of Issuer dated as of November 15, 2025, by and among the Issuer, P3Works, LLC, as
Administrator,” and Regions Bank, as “Dissemination Agent.” The Issuer anticipates that [the
Annual Financial Information][the Annual Collections Report][audited/unaudited Annual
Financial Statements] will be filed by __________________.
Dated: _____
Regions Bank,
on behalf of the Cit of Anna, Texas
as Dissemination A ent)
B :
Title:
cc: City of Anna, Texas
B-1
EXHIBIT B
CITY OF ANNA, TEXAS,
SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2
IMPROVEMENT AREA #1 PROJECT)
ANNUAL FINANCIAL INFORMATION*
Delivery Date: __________, 20__
CUSIP Nos: [insert CUSIP Nos.]
DISSEMINATION AGENT
Name: Regions Bank
Address: [__________________]
City: [_]
Telephone: (___) ___-____
Contact Person: Attn: ___________
Section 4(a)(i)
BONDS OUTSTANDING
Maturity
Date
Interest
Rate
Original
Principal
Amount
Outstanding
Principal
Amount
Outstanding
Interest
Amount
Total
INVESTMENTS
Fund/
Account Name
Investment
Descriptio
Par
Value(1)
Book
Value(1)
Market
Value(1)
1) As such information is provided by the Trustee.
Excluding audited financial statements of the Issuer
B-2
ASSETS AND LIABILITIES OF TRUST ESTATE
Cash Position of Trust Estate for statements dated September 30, 20[]
List of Funds/Accounts Held Under Indenture] Amount In the Fun
Total A
Bond Principal Amount Outstandin B
Outstandin Assessment Amount to be collected C
Net Position of Trust Estate and Outstanding Bonds and
Assessments
A-B+C
September 30, 20[__] Trust Statements: Audited Unaudited
Accounting Type: Cash Accrual Modified Accrual
Section 4(a)(ii)
FINANCIAL INFORMATION AND OPERATING DATA WITH RESPECT TO THE
ISSUER OF THE GENERAL TYPE AND IN SUBSTANTIALLY SIMILAR FORM
PROVIDED IN THE FOLLOWING TABLES AS OF THE END OF THE FISCAL YEAR
Debt Service Requirements on the Bonds
Year Ending
September 30) Principal Interest Total
Top [Five] Assessment Payers in Improvement Area #1 (1)
Property Owner
No. of
Parcels/Lots
Percentage of
Parcels/Lots
Outstanding
Assessments
Percentage of
Total
Assessments
1) Does not include those owing less than one percent (1%) of total Assessments.
Assessed Value of Improvement Area #1 of the District
The [YEAR] certified total assessed value for the Assessed Property in Improvement Area
1 of the District is approximately $[AMOUNT] according to the Collin Central Appraisal
District.
B-3
Foreclosure History Related to the Assessments for the Past Five Fiscal Years
Fiscal
Year
Ended
9/30)
Delinquent
Assessment Amount
not in Foreclosure
Proceedin s
Parcels in
Foreclosure
Proceedin s
Delinquent
Assessment Amount
in Foreclosure
Proceedin s
Foreclosure
Sales
Foreclosure Proceeds
Receive
20 $ $ $
20
20
20
20
insert any necessary footnotes]
Collection and Delinquency History of Annual Installments for the Past Five Fiscal Years
Fiscal Year
Ended
9/30)
Total Annual
Installment
Billed
Parcels
Levied(1)
Delinquent
Amount as
of 3/1
Delinquent
as of 3/1
Delinquent
Amount as
of [9/1]
Delinquent %
as of [9/1]
Total Annual
Installments
Collected(2)
20 $ $ % $ % $
20
20
20
20
1) Pursuant to Section 31.031, Texas Tax Code, certain veterans, persons aged 65 or older, and the disabled, who qualify for an exemption under
either Section 11.13(c), 11.32, or 11.22, Texas Tax Code, are eligible to pay property taxes in four equal installments (“Installment Payments”).
Effective January 1, 2018, pursuant to Section 31.031(a-1), Texas Tax Code, the Installment Payments are each due before February 1, April 1,
June 1, and August 1. Each unpaid Installment Payment is delinquent and incurs penalties and interest if not paid by the applicable date.
2) [Does/does not] include interest and penalties.
Parcel Numbers for Delinquencies Equaling or Exceeding 10% of Annual Installments Due
For the past five Fiscal Years, if the total amount of delinquencies as of September 1 equals
or exceeds ten percent (10%) of the amount of Annual Installments due, a list of parcel numbers
for which the Annual Installments are delinquent.
Fiscal Year
Ended (9/30) Delinquent % as of 9/1 Parcel Numbers
20 %
20__
History of Prepayment of Assessments for the Past Five Fiscal Years
Fiscal Year Ended (9/30)
Number of
Prepa ments
Amount of
Prepa ments Bond Call Date
Amount of
Bonds
Redeeme
20 $ $
20
20
20
20
insert any necessary footnotes]
ITEMS REQUIRED BY SECTION 4(a)(iii) - (iv)
Insert a line item for each applicable listing]
C-1
EXHIBIT C
CITY OF ANNA, TEXAS,
SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2
IMPROVEMENT AREA #1 PROJECT)
ANNUAL COLLECTIONS REPORT
Delivery Date: __________, 20__
CUSIP Nos: [insert CUSIP Nos.]
DISSEMINATION AGENT
Name: Regions Bank
Address: [______________________]
City: [_____, Texas _____]
Telephone: (___) ___-____
Contact Person: Attn: ___________
SELECT FINANCIAL INFORMATION AND OPERATING DATA WITH RESPECT TO
THE COLLECTION OF ASSESSMENTS COVERING THE PERIOD BEGINNING WITH
THE FIRST DAY OF THE FISCAL YEAR SUCCEEDING THE REPORTING FISCAL
YEAR THROUGH THE COLLECTIONS REPORTING DATE PROVIDED IN
COMPLIANCE WITH SUBSECTION 5(A) OF THE ISSUER’S DISCLOSURE
AGREEMENT
Foreclosure History Related To The Annual Installments(1)
Succeeding
Fiscal Yea
Delinquent Annual
Installment Amount
not in Foreclosure
Proceedin s
Parcels in
Foreclosure
Proceedin s
Delinquent Annual
Installment Amount
in Foreclosure
Proceedin s
Foreclosure
Sales
Foreclosure Proceeds
Receive
20 $ $ $
i) Period covered includes October 1, 20__ through March 1, 20__.
C-2
Collection and Delinquency of Annual Installments (1)
Succeeding
Fiscal Yea
Total Annual
Installments
Levie
Parcels
Levied(2)
Delinquent
Amount as
of 3/1
Delinquent
as of 3/1
Total Annual
Installments
Collected(3)
20__ $ $ % $
1) Period covered includes October 1, 20__ through March 1, 20__.
2) Pursuant to Section 31.031, Texas Tax Code, certain veterans, persons aged 65 or older, and the disabled, who qualify for an exemption under
either Section 11.13(c), 11.32, or 11.22, Texas Tax Code, are eligible to pay property taxes in four equal installments (“Installment Payments”).
Effective January 1, 2018, pursuant to Section 31.031(a-1), Texas Tax Code, the Installment Payments are each due before February 1, April 1,
June 1, and August 1. Each unpaid Installment Payment is delinquent and incurs penalties and interest if not paid by the applicable date.
3) [Does/does not] include interest and penalties.
Prepayment of Assessments(1)
Succeeding
Fiscal Yea
Number of
Prepa ments
Amount of
Prepa ments Bond Call Date
Amount of
Bonds
Redeeme
1) Period covered includes October 1, 20__ through March 1, 20__.
D-1
EXHIBIT D
BASIC EXPECTED TIMELINE FOR ASSESSMENT COLLECTIONS
AND PURSUIT OF DELINQUENCIES1
Date
Delinquency
Clock (Days) Activity
January 31 Assessments are due.
February 1 1 Assessments delinquent if not received.
February 15 15 Immediately upon receipt, but in no event later than
February 15, Issuer forwards payment to Trustee for all
collections received, along with detailed breakdown.
Subsequent payments and relevant details will follow
monthly thereafter.
Issuer and/or Administrator should be aware of actual
and specific delinquencies.
Administrator should be aware if Reserve Fund needs
to be utilized for debt service payments during the
corresponding Fiscal Year.
Issuer and Administrator should determine if
previously collected surplus funds, if any, plus actual
Annual Installment collections will be fully adequate
for debt service in the corresponding March and
September.
March 15 43/44 Trustee pays bond interest payments to Owners.
April 1 59/60 At this point, if total delinquencies are under 5% and if
there is adequate funding in the Pledged Revenue Fund
for transfer to the Principal and Interest Account for full
September payments, no further action is anticipated for
collection of Assessments except that the Issuer or
Administrator, working with the City Attorney or an
appropriate designee, will begin process to cure
deficiency.
1 Illustrates anticipated dates and procedures for pursuing the collection of delinquent Annual Installments of
Assessments, which dates and procedures shall be in accordance with Chapters 31, 32, 33, and 34, Texas Tax
Code, as amended (the “Code”), and the Tax/Assessor Collector’s procedures, and are subject to adjustment
by the Issuer. If the collection and delinquency procedures under the Code are subsequently modified,
whether due to an executive order of the Governor of Texas, an amendment to the Code, or otherwise, such
modifications shall control.
D-2
Issuer, or the Trustee on behalf of the Issuer, to notify
Dissemination Agent in writing of the occurrence of a
draw on the Reserve Fund and, following receipt of
such notice, Dissemination Agent to notify MSRB of
such draw or the Reserve Fund.
July 1 152/153 Issuer, or the Administrator on behalf of the Issuer,
determines whether or not any Annual Installments
are delinquent and, if such delinquencies exist, the
Issuer commences as soon as practicable
appropriate and legally permissible actions to
obtain such delinquent Annual Installments, in
accordance with the County Tax Assessor-Collector
procedures. 2
Preliminary Foreclosure activity commences in
accordance with Tax Assessor/Collector’s
procedures.
Issuer notifies Trustee and Dissemination Agent in
writing of the commencement of preliminary
foreclosure activity.
If Dissemination Agent has not received Foreclosure
Schedule and Plan of Collections, Dissemination Agent
to request same from the Issuer.
If the Issuer has not provided the Dissemination Agent
with Foreclosure Schedule and Plan of Collections,
Dissemination Agent requests that the Issuer
commence foreclosure or provide plan for collection.
August 15 197/198 The designated lawyers or law firm will be preparing
the formal foreclosure documents and will provide
periodic updates to the Dissemination Agent and the
Trustee. The goal for the foreclosure actions is a filing
by no later than August 15 (day 197/198).
Foreclosure action to be filed with the court as soon
as practicable, in accordance with the Tax
Assessor/Collector’s procedures.
2 If the collection and delinquency procedures under the Code are subsequently modified, whether due to an
executive order of the Governor of Texas or an amendment to the Code, such modifications shall control.
D-3
Issuer notifies Trustee and Dissemination Agent of
Foreclosure filing status in writing. Dissemination
Agent notifies Owners.
If Owners and Dissemination Agent have not been
notified of a foreclosure action, Dissemination Agent
will notify the Issuer that it is appropriate to file action
A committee of not less than twenty-five percent (25%) of the Owners may request a meeting with
the Issuer to discuss the Issuer’s actions in pursuing the repayment of any delinquencies. This
would also occur after day thirty (30) if it is apparent that a Reserve Fund draw is required. Further,
if delinquencies exceed five percent (5%), Owners may also request a meeting with the Issuer at
any time to discuss the Issuer’s plan and progress on collection and foreclosure activity. If the
Issuer is not diligently proceeding with the foreclosure process, the Owners may seek an action for
mandamus or specific performance to direct the Issuer to pursue the collections of delinquent
Annual Installments of Assessments.
THIS PAGE IS LEFT BLANK INTENTIONALLY.
APPENDIX E-2
FORM OF DISCLOSURE AGREEMENT OF DEVELOPER
Draft 10/8/2025
714154538v2
CITY OF ANNA, TEXAS,
SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2
IMPROVEMENT AREA #1 PROJECT)
CONTINUING DISCLOSURE AGREEMENT OF DEVELOPER
This Continuing Disclosure Agreement of Developer dated as of November 15, 2025 (this
Disclosure Agreement”), is executed and delivered by and among Bloomfield Homes, L.P., a Texas
limited partnership (the “Developer”), P3Works, LLC (the “Administrator”), and Regions Bank, acting
solely in its capacity as dissemination agent (the “Dissemination Agent”) with respect to the captioned
bonds (the “Bonds”). The Developer, the Administrator, and the Dissemination Agent covenant and
agree as follows:
SECTION 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being
executed and delivered by the Developer, the Administrator, and the Dissemination Agent for the benefit
of the Owners (defined below) and beneficial owners of the Bonds. Unless and until a different filing
location is designated by the MSRB (defined below) or the SEC (defined below), all filings made by the
Dissemination Agent pursuant to this Disclosure Agreement shall be filed with the MSRB through
EMMA (defined below).
SECTION 2. Definitions. In addition to the definitions set forth above and in the Indenture
of Trust, dated as of November 15, 2025, relating to the Bonds (the “Indenture”), which apply to any
capitalized term used in this Disclosure Agreement, including the Exhibits hereto, the following
capitalized terms shall have the following meanings:
Affiliate” shall mean an entity that is controlled by, controls, or is under common control with
another entity.
Amenities” shall mean the amenities to be constructed by the Developer in connection with the
development of Improvement Area #1, which may include, but are not limited to: (i) approximately
4,000 square foot swimming pool; (ii) mechanical aquatic play feature; (iii) pool house with restrooms;
iv) playground (2-5 years of age); (v) playground (5-8 years of age); (vi) sand volleyball court; (vii)
basketball court; (viii) approximately 1,000 square foot putting green; (ix) outdoor workout equipment
along hike and bike trails; (x) 20 ft radius pavilion; (xi) dog park; and (xii) park benches, trash cans, and
pet stations along the trail and in the dog park.
Annual Collection Costs” shall have the meaning assigned to such term in the Indenture.
Annual Installment” shall have the meaning assigned to “Improvement Area #1 Annual
Installment” in the Indenture.
Assessments” shall have the meaning assigned to “Improvement Area #1 Assessments” in the
Indenture.
Certification Letter” shall mean a certification letter provided by a Reporting Party pursuant to
Section 3, in substantially the form attached as Exhibit D.
2
Developer” shall mean Bloomfield Homes, L.P., a Texas limited partnership, its successors and
assigns, including any Affiliate of the Developer.
Developer Listed Events” shall mean any of the events listed in Section 4(a) of this Disclosure
Agreement.
Disclosure Agreement of Issuer” shall mean the Continuing Disclosure Agreement of Issuer
with respect to the Bonds dated as of even date herewith executed and delivered by and among the Issuer,
the Administrator, and the Dissemination Agent.
Dissemination Agent” shall mean Regions Bank, acting solely in its capacity as dissemination
agent, or any successor Dissemination Agent designated in writing by the Issuer, and which has filed
with the Trustee a written acceptance of such designation.
District” shall mean the Crystal Park Public Improvement District No. 2.
EMMA” shall mean the Electronic Municipal Market Access System administered by the
MSRB which, as of the date of this Disclosure Agreement, is available on the internet at
http://emma.msrb.org.
Homebuilder(s)” shall mean any merchant homebuilder who enters into a Lot Purchase
Agreement with the Developer, and the successors and assigns of such homebuilder under such Lot
Purchase Agreement.
Improvement Area #1” shall have the meaning assigned to such term in the Indenture.
Improvement Area #1 Projects” shall have the meaning assigned to such term in the Indenture.
Issuer” shall mean the City of Anna, Texas.
Listed Events” shall mean, collectively, Developer Listed Events and Significant Homebuilder
Listed Events.
Lot Purchase Agreement” shall mean, with respect to lots or land within Improvement Area #1
of the District, any agreement between a Homebuilder and the Developer to purchase lots or to purchase
land.
MSRB” shall mean the Municipal Securities Rulemaking Board, or any other entity designated
or authorized by the SEC to receive reports pursuant to the Rule.
Participating Underwriter” shall mean FMSbonds, Inc., and its successors and assigns.
Quarterly Ending Date” shall mean each March 31, June 30, September 30 and December 31,
beginning March 31, 2026.
Quarterly Filing Date” shall mean for each Quarterly Ending Date, the fifteenth calendar day of
the second month following such Quarterly Ending Date being February 15, May 15, August 15, and
December 15.
3
Quarterly Information” shall have the meaning assigned to such term in Section 3 of this
Disclosure Agreement.
Quarterly Report” shall mean any Quarterly Report described in Section 3 of this Disclosure
Agreement and containing the information listed in Exhibit A hereto.
Reporting Party” shall mean, collectively, the Developer and any Significant Homebuilder who
has acknowledged and assumed reporting obligations in accordance with Section 6 of this Disclosure
Agreement.
Rule” shall mean Rule 15c2-12 adopted by the SEC under the Securities Exchange Act of 1934,
as the same may be amended from time to time.
SEC” shall mean the United States Securities and Exchange Commission.
Significant Homebuilder” shall mean a Homebuilder that then owns 17 or more of the single
family residential lots within Improvement Area #1.
Significant Homebuilder Listed Events” shall mean any of the events listed in Section 4(b) of
this Disclosure Agreement.
SECTION 3. Quarterly Reports.
a) The Developer and any Significant Homebuilder that is a Reporting Party, with respect
to its acquired real property, shall, at its cost and expense, provide, or cause to be provided, to the
Administrator, not more than ten (10) days after each Quarterly Ending Date, beginning with March 31,
2026, the information in the Quarterly Report required to be provided by such Reporting Party pursuant
to Section 3(d) (with respect to each Reporting Party, the “Quarterly Information”). The Reporting Party
shall provide, or cause to be provided, such Quarterly Information until such party’s obligations
terminate pursuant to Section 7 of this Disclosure Agreement. For the avoidance of doubt, (i) if the
Developer elects, the Developer may, but shall not be obligated to, provide any Quarterly Information
on behalf of any Significant Homebuilder and (ii) the Developer shall remain obligated with respect to
any real property acquired by a Significant Homebuilder until a Significant Homebuilder
Acknowledgement (as defined herein) with respect to such real property is delivered in accordance with
Section 6 of this Disclosure Agreement, at which time the Developer shall have no further obligation or
liability for disclosures or other responsibilities under this Disclosure Agreement as to the property
transferred to such Significant Homebuilder.
b) The Administrator shall (i) review each Quarterly Report containing the Quarterly
Information provided by each Reporting Party pursuant to subsection (a) above and (ii) no later than
twenty (20) days after each Quarterly Ending Date, either (1) advise the applicable Reporting Party as
to any necessary changes to the applicable Quarterly Information or (2) provide to the Dissemination
Agent the Quarterly Report in accordance with subsection (c) below. If the Administrator advises a
Reporting Party as to any necessary changes to their respective Quarterly Information, such Reporting
Party shall provide, or cause to be provided, to the Administrator, not more than thirty (30) days after
each Quarterly Ending Date, the revised Quarterly Information. The Administrator shall review the
revised Quarterly Information within the Quarterly Report and provide the Quarterly Report to the
Dissemination Agent in accordance with subsection (c) below.
4
If Reporting Parties provide the Quarterly Information in more than one report to the
Administrator, the Administrator shall (i) prepare each Quarterly Report with the Quarterly Information
provided by the Reporting Parties pursuant to subsection (a) above, and (ii) provide the Quarterly Report
to the Reporting Parties for review no later than twenty (20) days after each Quarterly Ending Date. The
Reporting Parties shall review and revise, as necessary, the Quarterly Report and, upon such review,
shall promptly, but no later than thirty (30) days after each Quarterly Ending Date, provide the Quarterly
Report and Certification Letter(s) to the Administrator and direct the Administrator to provide such
Quarterly Report and Certification Letter(s) to the Issuer and the Dissemination Agent pursuant to
subsection (c) below.
In all cases, each Reporting Party shall have the sole responsibility for the content, design and
other elements comprising substantive contents of all of the Quarterly Information provided by such
Reporting Party contained in the Quarterly Report.
c) The Administrator shall provide to the Dissemination Agent, with a copy to each
Reporting Party, no later than thirty-five (35) days after each Quarterly Ending Date, the Quarterly
Report containing the information described in Section 3(d), the Certification Letter(s), if applicable,
and written direction to the Dissemination Agent to file such report with the MSRB. The Dissemination
Agent shall file the Quarterly Report and the Certification Letter(s), if applicable, with the MSRB and
provide a copy of such report to the Issuer and the Participating Underwriter within ten (10) days of the
Dissemination Agent’s receipt thereof pursuant to this subsection 3(c); provided, however, that the
Quarterly Report must be submitted to the MSRB not later than each Quarterly Filing Date. In the event
that any Reporting Party or the Administrator does not provide the information required by subsection
a) or (b) of this Section 3, as applicable, in a timely manner and, as a result, either an incomplete
Quarterly Report is filed with the MSRB, or a Quarterly Report is not filed with the MSRB by each
Quarterly Filing Date, the Dissemination Agent shall, upon written direction from the applicable
Reporting Party file a notice of failure to provide Quarterly Information or failure to file a Quarterly
Report with the MSRB in substantially the form attached as Exhibit B, as soon as practicable. If
incomplete Quarterly Information or no Quarterly Information is provided by any Reporting Party, the
Dissemination Agent and any other Reporting Party who provided complete Quarterly Information shall
not be responsible for the failure to submit a complete Quarterly Report to the MSRB. If each Reporting
Party timely provides the required Quarterly Information to the Administrator as described in this Section
3, the failure of the Administrator to provide the Quarterly Report to the Dissemination Agent, or the
failure of the Dissemination Agent to provide such report to the Participating Underwriter in a timely
manner, shall not be deemed a default by the Reporting Parties under this Disclosure Agreement.
d) Each Quarterly Report shall consist of the information listed in Exhibit A attached hereto.
SECTION 4. Event Reporting Obligations.
a) Pursuant to the provisions of this Section 4, each of the following is a Developer Listed
Event with respect to the Bonds:
i) Failure to pay any real property taxes or Assessments levied within Improvement
Area #1 on a parcel owned by the Developer; provided, however, that the exercise of any right
of the Developer as a landowner within Improvement Area #1 to exercise legal and/or
administrative procedures to dispute the amount or validity of all or any part of any real property
5
taxes shall not be considered a Developer Listed Event under this Section nor a breach or default
of this Disclosure Agreement;
ii) Material damage to or destruction of any development or improvements within
Improvement Area #1, including the Improvement Area #1 Projects and the Amenities;
iii) Material default by the Developer or any of the Developer’s Affiliates on any loan
with respect to the acquisition, development, or permanent financing of Improvement Area #1
Projects undertaken by the Developer or any of the Developer’s Affiliates;
iv) Material default by the Developer or any of Developer’s Affiliates on any loan
secured by property within Improvement Area #1 owned by the Developer or any of the
Developer’s Affiliates;
v) The bankruptcy, insolvency, or similar filing of the Developer or any of the
Developer’s Affiliates or any determination that the Developer or any of the Developer’s
Affiliates is unable to pay its debts as they become due;
vi) The consummation of a merger, consolidation, or acquisition of the Developer, or
the sale of all or substantially all of the assets of the Developer or any of the Developer’s
Affiliates, 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;
vii) The filing of any lawsuit with a claim for damages in excess of $1,000,000 against
the Developer or any of the Developer’s Affiliates that may adversely affect the completion of
development of Improvement Area #1, or litigation that may materially adversely affect the
financial condition of the Developer or any of the Developer’s Affiliates;
viii) Any material change in the legal structure, chief executive officer, or controlling
ownership of the Developer;
ix) Any assignment and assumption of disclosure obligations under this Disclosure
Agreement pursuant to Sections 5 or 6 hereof; and
x) Early termination of or material default by a Homebuilder under a Lot Purchase
Agreement.
b) Pursuant to the provisions of this Section 4, each of the following occurrences related to
any Significant Homebuilder is a Significant Homebuilder Listed Event with respect to the Bonds:
i) Failure to pay any real property taxes or Assessments levied within Improvement
Area #1 on a lot or parcel owned by such Significant Homebuilder; provided, however, that the
exercise of any right of such Significant Homebuilder as a landowner within Improvement Area
1 to exercise legal and/or administrative procedures to dispute the amount or validity of all or
any part of any real property taxes shall not be considered a Significant Homebuilder Listed
Event under this Section nor a breach or default of this Disclosure Agreement;
6
ii) The bankruptcy, insolvency, or similar filing of such Significant Homebuilder or
any determination that such Significant Homebuilder is unable to pay its debts as they become
due;
iii) The consummation of a merger, consolidation, or acquisition involving such
Significant Homebuilder or the sale of all or substantially all of the assets of the Significant
Homebuilder, 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;
iv) Any change in the type of legal entity, chief executive officer, or controlling
ownership of such Significant Homebuilder;
v) Early termination of or material default by such Significant Homebuilder under a
Lot Purchase Agreement; and
vi) Any assignment and assumption of disclosure obligations under this Disclosure
Agreement pursuant to Section 6 hereof.
c) Whenever a Reporting Party obtains knowledge of the occurrence of a Listed Event
applicable to such Reporting Party, such Reporting Party shall promptly, and not more than five (5)
Business Days after such Reporting Party obtains such knowledge, notify the Issuer, the Administrator
and the Dissemination Agent in writing and the Reporting Party shall direct the Dissemination Agent to
file a notice of such occurrence with the MSRB, in the manner hereinafter described, and provide a copy
of such notice to the Issuer and the Participating Underwriter. Any such notice is required to be filed
within ten (10) Business Days after the Reporting Party becomes aware of the occurrence of such Listed
Event. If the Reporting Party timely notifies the Dissemination Agent of the occurrence of a Listed Event,
as described in this Section 4, the failure of the Dissemination Agent to provide such notice to the
Participating Underwriter in a timely manner shall not be deemed a default by such Reporting Party
under this Disclosure Agreement.
The Developer and each other Reporting Party, if any, shall only be responsible for reporting the
occurrence of a Listed Event applicable to such Reporting Party and shall not be responsible for reporting
the occurrence of a Listed Event applicable to any other Reporting Party, regardless of if a Reporting
Party is providing Quarterly Information on behalf of any other Reporting Party.
Any notice under the preceding paragraphs shall be accompanied with the text of the disclosure
that the applicable Reporting Party desires to make, the written authorization of such Reporting Party
for the Dissemination Agent to disseminate such information as provided herein, and the date the
Reporting Party desires for the Dissemination Agent to disseminate the information.
In all cases, the applicable Reporting Party shall have the sole responsibility for the content,
design and other elements comprising substantive contents of all disclosures. In addition, the applicable
Reporting Party shall have the sole responsibility to ensure that any notice required to be filed with the
MSRB under this Section 4 is actually filed within ten (10) Business Days after such Reporting Party
becomes aware of the Listed Event applicable to such Reporting Party.
7
d) The Dissemination Agent shall, promptly, and not more than five (5) Business Days after
obtaining actual knowledge of the occurrence of any Listed Event, notify in writing the Administrator
and the applicable Reporting Party of such Listed Event. The Dissemination Agent shall not be required
to file a notice of the occurrence of such Listed Event with the MSRB unless and until it receives written
instructions from the applicable Reporting Party to do so. It is agreed and understood that the duty to
make or cause to be made the disclosures herein is that of the Reporting Party and not that of the Trustee
or the Dissemination Agent. It is agreed and understood that the Dissemination Agent has agreed to give
the foregoing notice to the applicable Reporting Party as an accommodation to assist it in monitoring the
occurrence of such event, but is under no obligation to investigate whether any such event has occurred.
As used above, “actual knowledge” means the actual fact or statement of knowing, without a duty to
make any investigation with respect thereto. In no event shall the Dissemination Agent be liable in
damages or in tort to the Participating Underwriter, the Administrator, the Issuer, any Reporting Party
or any Owner or beneficial owner of any interests in the Bonds as a result of its failure to give the
foregoing notice or to give such notice in a timely fashion.
e) If the Dissemination Agent has been notified in writing by a Reporting Party to report the
occurrence of a Listed Event in accordance with subsections (c) or (d) of this Section 4, the
Dissemination Agent shall file a notice of such occurrence with the MSRB promptly after its receipt of
such written instructions from such Reporting Party; provided that all such notices must be filed no later
than the date specified in subsection (c) of this Section 4 for such Listed Event.
SECTION 5. Assumption of Reporting Obligations of Developer.
The Developer shall cause each Person who, through assignment, assumes the obligations,
requirements, or covenants to construct one or more of the Improvement Area #1 Projects or the
Amenities to assume and comply with the disclosure obligations of the Developer under this Disclosure
Agreement. The Developer shall deliver to the Dissemination Agent, the Administrator, and the Issuer a
written acknowledgement from each Person who assumes the obligations, requirements, or covenants to
construct one or more of the Improvement Area #1 Projects or Amenities in substantially the form
attached as Exhibit E (the “Developer Acknowledgment”), acknowledging and assuming its obligations
under this Disclosure Agreement. Pursuant to Section 4(a)(ix) above, the Developer shall direct the
Dissemination Agent to file a copy of each Developer Acknowledgment with the MSRB, in accordance
with Sections 4(c) and 4(e) above. Upon any such transfer to a Person, and such Person’s delivery of
written acknowledgement of assumption of Developer’s obligations under this Disclosure Agreement as
to the property transferred, the Developer shall have no further obligation or liability for disclosures or
other responsibilities under this Disclosure Agreement as to the property transferred or the obligations
assigned. Notwithstanding anything to the contrary elsewhere herein, after such transfer of ownership,
the Developer shall not be liable for the acts or omissions of such Person arising from or in connection
with such disclosure obligations under this Disclosure Agreement.
SECTION 6. Assumption of Reporting Obligations by Significant Homebuilder.
a) If a Homebuilder acquires ownership of real property in Improvement Area #1 resulting
in such Homebuilder becoming a Significant Homebuilder, the Developer may (i) cause such Significant
Homebuilder to comply with the Developer’s disclosure obligations under Section 3 and Section 4(b)
hereof, with respect to such acquired real property, until such party’s disclosure obligations terminate
pursuant to Section 7 of this Disclosure Agreement or (ii) elect to provide any or all Quarterly
8
Information on behalf of such Significant Homebuilder; provided, however, that if the Developer
initially elects to provide any or all Quarterly Information on behalf of such Significant Homebuilder,
the Developer may elect in the future to cause such Significant Homebuilder to comply with the
Developer’s disclosure obligations, as described in clause (i) above.
b) If the Developer elects to cause a Significant Homebuilder to comply with the
Developer’s disclosure obligations, as described in clause (i) above, the Developer shall deliver to the
Dissemination Agent, Administrator and the Issuer a written acknowledgement from each Significant
Homebuilder, in substantially the form attached as Exhibit F, acknowledging and assuming the
Developer’s obligations under this Disclosure Agreement with respect to the real property transferred
the “Significant Homebuilder Acknowledgment”). Pursuant to Section 4(a)(ix) above, the Developer
shall direct the Dissemination Agent to file a copy of the Significant Homebuilder Acknowledgment
with the MSRB, in accordance with Sections 4(c) and 4(e) above. Upon any such transfer to a Significant
Homebuilder and such Significant Homebuilder’s delivery of the Significant Homebuilder
Acknowledgment, the Developer shall have no further obligation or liability for disclosures or other
responsibilities under this Disclosure Agreement as to the property transferred or the obligations
assigned. The Developer shall remain obligated with respect to any real property acquired by a
Significant Homebuilder until the Significant Homebuilder Acknowledgement with respect to such real
property is delivered to the Dissemination Agent, Administrator, the Issuer and the MSRB, in accordance
with this Section 6(b).
c) Notwithstanding anything to the contrary elsewhere herein, after such transfer of
ownership of real property, the Developer shall not be liable for the acts or omissions of such Significant
Homebuilder arising from or in connection with such disclosure obligations under this Disclosure
Agreement.
SECTION 7. Termination of Reporting Obligations.
a) The reporting obligations of a Reporting Party under this Disclosure Agreement shall
terminate upon the earlier of (i) the date when none of the Bonds remain Outstanding, (ii) when the
Reporting Party, including their respective Affiliates and/or successors and assigns, no longer owns 17
or more single family residential lots within Improvement Area #1, as of each Quarterly Ending Date,
or (iii) the Issuer’s issuance of the certificate of occupancy for the last single family residential lot or
Parcel owned by the Reporting Party, including their respective Affiliates and/or successors and assigns,
respectively; provided, however, if the Developer elects to provide any or all Quarterly Information on
behalf of a Significant Homebuilder in accordance with Section 6(a) above, the reporting obligations of
the Developer under this Disclosure Agreement shall terminate upon the earlier of (i) the date when none
of the Bonds remain Outstanding, (ii) when the Developer and such Significant Homebuilder(s) (on
behalf of whom the Developer is reporting), including their respective Affiliates and/or successors and
assigns, collectively no longer own 17 or more single family residential lots within Improvement Area
1, as of each Quarterly Ending Date, or (iii) the Issuer’s issuance of the certificate of occupancy for the
last single family residential lot or Parcel owned by the Developer and such Significant Homebuilder(s)
on behalf of whom the Developer is reporting), including their respective Affiliates and/or successors
and assigns.
b) Upon receipt of written notice from a Reporting Party or the Dissemination Agent that
the reporting obligations of a Reporting Party have terminated in accordance with subsection (a) of this
9
Section 7, the Administrator shall provide written notice to the applicable Reporting Party, the
Participating Underwriter, the Issuer, and the Dissemination Agent in substantially the form attached as
Exhibit C, of the termination of such Reporting Party’s reporting obligations under this Disclosure
Agreement (the “Termination Notice”). If such Termination Notice with respect to a Reporting Party
occurs while any of the Bonds remain Outstanding, the Administrator shall immediately provide, or
cause to be provided, the Termination Notice to the Dissemination Agent, and the Dissemination Agent
shall provide such Termination Notice to the MSRB, the Issuer, the Trustee, the applicable Reporting
Party and the Participating Underwriter on or before the next succeeding Quarterly Filing Date.
c) The obligations of the Administrator and the Dissemination Agent under this Disclosure
Agreement shall terminate upon, the earlier of (i) the date when none of the Bonds remain Outstanding,
or (ii) termination of all Reporting Parties’ reporting obligations in accordance with subsection (a) of
this Section 7 and any Termination Notice required by subsection (b) of this Section 7 has been provided
to the MSRB, the Issuer, the Trustee, the Dissemination Agent, the Reporting Parties, and the
Participating Underwriter, as applicable.
SECTION 8. Dissemination Agent. The Issuer may, from time to time, appoint or engage
a Dissemination Agent or successor Dissemination Agent to assist the Developer and any other
Reporting Party in carrying out their obligations under this Disclosure Agreement, and may discharge
such Dissemination Agent, with or without appointing a successor Dissemination Agent. The
Dissemination Agent may resign at any time with thirty (30) days’ notice to the Issuer, the Developer,
and the Administrator; provided, however, that if the Dissemination Agent is serving in the same
capacity under the Disclosure Agreement of Issuer, the Dissemination Agent shall resign under the
Disclosure Agreement of Issuer simultaneously with its resignation hereunder; provided, further, that if
the Issuer is the Dissemination Agent, the Issuer may not resign without first appointing a successor
Dissemination Agent. If at any time there is not any other designated Dissemination Agent, the Issuer
shall be the Dissemination Agent. Pursuant to the Disclosure Agreement of Issuer, the Issuer has agreed
to provide written notice to each Reporting Party of any change in the identity of the Dissemination
Agent. The initial Dissemination Agent appointed hereunder shall be Regions Bank.
SECTION 9. Amendment; Waiver. Notwithstanding any other provisions of this
Disclosure Agreement, the Developer, the Administrator, and the Dissemination Agent may jointly
amend this Disclosure Agreement (and the Dissemination Agent shall not unreasonably withhold its
consent to any amendment so requested in writing by the Developer or the Administrator), and any
provision of this Disclosure Agreement may be waived, provided that the following conditions are
satisfied:
a) If the amendment or waiver relates to the provisions of Sections 3 or 4, it may only be
made in connection with a change in circumstances that arises from a change in legal requirements,
change in law, or change in the identity, nature or status of a Reporting Party, or the type of business
conducted; and
b) The amendment or waiver either (i) is approved by the Owners of the Bonds in the same
manner as provided in the Indenture for amendments to the Indenture with the consent of Owners, or
ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the
Owners or beneficial owners of the Bonds. No amendment which adversely affects the Issuer may be
made without the Issuer’s prior written consent.
10
In the event of any amendment or waiver of a provision of this Disclosure Agreement, the
Administrator shall describe such amendment in the next related Quarterly Report, and shall include, as
applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type
of financial information or operating data being presented by the Developer. The Developer shall
provide, or cause to be provided, at its cost and expense, an executed copy of any amendment or waiver
entered into in accordance with this Section 9 to the Issuer, the Administrator, the Dissemination Agent,
and the Participating Underwriter.
SECTION 10. Additional Information. Nothing in this Disclosure Agreement shall be
deemed to prevent a Reporting Party from disseminating any other information, using the means of
dissemination set forth in this Disclosure Agreement or any other means of communication, or including
any other information in addition to that which is required by this Disclosure Agreement. If any
Reporting Party chooses to include any information in any Quarterly Report or notice of occurrence of
a Developer Listed Event or Significant Homebuilder Listed Event, as applicable, in addition to that
which is specifically required by this Disclosure Agreement, such Reporting Party shall have no
obligation under this Disclosure Agreement to update such information or include it in any future
Quarterly Report or notice of occurrence of a Developer Listed Event or Significant Homebuilder Listed
Event.
SECTION 11. Content of Disclosures. In all cases, the Developer or Significant
Homebuilder, as applicable, shall have the sole responsibility for the content, design, and other elements
comprising substantive contents of all disclosures provided under this Disclosure Agreement.
SECTION 12. Default. In the event of a failure of any Reporting Party or the Administrator
to comply with any provision of this Disclosure Agreement, (i) the Dissemination Agent or any Owner
or beneficial owner of the Bonds may, and (ii) at the request of any Participating Underwriter or the
Owners of at least twenty-five percent (25%) aggregate principal amount of Outstanding Bonds and
upon being indemnified to its satisfaction, the Dissemination Agent shall, take such actions as may be
necessary and appropriate to cause the Reporting Party and/or the Administrator to comply with its
obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be
deemed an Event of Default under the Indenture with respect to the Bonds, and the sole remedy under
this Disclosure Agreement in the event of any failure of the Reporting Party or the Administrator to
comply with this Disclosure Agreement shall be an action in mandamus or specific performance. A
default under this Disclosure Agreement shall not be deemed a default under the Disclosure Agreement
of Issuer, and a default under the Disclosure Agreement of Issuer shall not be deemed a default under
this Disclosure Agreement. Additionally, a default by the Developer of its obligations under this
Disclosure Agreement shall not be deemed a default by any Significant Homebuilder of such Significant
Homebuilder’s obligations under this Disclosure Agreement; and, likewise, a default by any Significant
Homebuilder of such Significant Homebuilder’s obligations under this Disclosure Agreement shall not
be deemed a default of the Developer of the Developer’s obligations under this Disclosure Agreement.
SECTION 13. Duties, Immunities and Liabilities of Dissemination Agent and Administrator.
a) The Dissemination Agent shall not be responsible in any manner for the content of any
notice or report (including without limitation the Quarterly Report) prepared by the Developer,
Significant Homebuilder, and/or the Administrator pursuant to this Disclosure Agreement. The
Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure
11
Agreement, and no implied covenants shall be read into this Disclosure Agreement with respect to the
Dissemination Agent. The Developer agrees to indemnify and hold harmless the Dissemination Agent,
its officers, directors, employees, and agents against any loss, expense, and liabilities which it may incur
arising out of or in the exercise or performance of its powers and duties hereunder, including the costs
and expenses (including reasonable attorneys’ fees) of defending against any claim of liability, but
excluding liabilities due to the Dissemination Agent’s negligence or willful misconduct. The obligations
of the Developer under this Section shall survive termination of this Disclosure Agreement, resignation
or removal of the Dissemination Agent, and payment in full of the Bonds. Nothing in this Disclosure
Agreement shall be construed to mean or to imply that the Dissemination Agent is an “obligated person”
under the Rule. The Dissemination Agent is not acting in a fiduciary capacity in connection with the
performance of its respective obligations hereunder. The Dissemination Agent shall not in any event
incur any liability with respect to (i) any action taken or omitted to be taken in good faith upon advice
of legal counsel given with respect to any question relating to duties and responsibilities of the
Dissemination Agent hereunder, or (ii) any action taken or omitted to be taken in reliance upon any
document delivered to the Dissemination Agent and believed to be genuine and to have been signed or
presented by the proper party or parties.
b) The Administrator shall not have any duty with respect to the content of any disclosures
made pursuant to the terms hereof. The Administrator shall have only such duties as are specifically set
forth in this Disclosure Agreement, and no implied covenants shall be read into this Disclosure
Agreement with respect to the Administrator. The Developer agrees to indemnify and hold harmless the
Administrator, its officers, directors, employees, and agents against any loss, expense, and liabilities
which it may incur arising out of or in the exercise or performance of its powers and duties hereunder,
including the costs and expenses (including reasonable attorneys’ fees) of defending against any claim
of liability, but excluding liabilities due to the Administrator’s breach, negligence, or willful misconduct.
The obligations of the Developer under this Section shall survive termination of this Disclosure
Agreement, resignation or removal of the Administrator and payment in full of the Bonds. Nothing in
this Disclosure Agreement shall be construed to mean or to imply that the Administrator is an “obligated
person” under the Rule. The Administrator is not acting in a fiduciary capacity in connection with the
performance of its respective obligations hereunder. The Administrator shall not in any event incur any
liability with respect to (i) any action taken or omitted to be taken in good faith upon advice of legal
counsel given with respect to any question relating to duties and responsibilities of the Administrator
hereunder, or (ii) any action taken or omitted to be taken in reliance upon any document delivered to the
Administrator and believed to be genuine and to have been signed or presented by the proper party or
parties.
c) The Dissemination Agent or the Administrator may, from time to time, consult with legal
counsel of its own choosing in the event of any disagreement or controversy, or question or doubt as to
the construction of any of the provisions hereof or their respective duties hereunder, and the
Dissemination Agent and Administrator shall not incur any liability and shall be fully protected in acting
in good faith upon the advice of such legal counsel. The Developer, the Administrator, and the
Dissemination Agent agree that the legal expenses of the Dissemination Agent or the Administrator to
which it is expressly entitled to be paid pursuant to this Section 13(c) are Annual Collection Costs.
d) UNDER NO CIRCUMSTANCES SHALL THE DISSEMINATION AGENT, THE
ADMINISTRATOR, THE DEVELOPER, OR ANY SIGNIFICANT HOMEBUILDER BE LIABLE
TO THE OWNER OR BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN
12
CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY
BREACH BY ANY OTHER PARTY TO THIS DISCLOSURE AGREEMENT OR A SIGNIFICANT
HOMEBUILDER, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY
COVENANT SPECIFIED IN THIS DISCLOSURE AGREEMENT, BUT EVERY RIGHT AND
REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY
SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC
PERFORMANCE. THE DISSEMINATION AGENT AND THE ADMINISTRATOR ARE UNDER
NO OBLIGATION NOR ARE THEY REQUIRED TO BRING SUCH AN ACTION, EXCEPT AS
DESCRIBED IN SECTION 12 WITH RESPECT TO THE DISSEMINATION AGENT.
SECTION 14. No Personal Liability. No covenant, stipulation, obligation, or agreement of
any Reporting Party, the Administrator, or the Dissemination Agent contained in this Disclosure
Agreement shall be deemed to be a covenant, stipulation, obligation, or agreement of any present or
future officer, agent, or employee of the Reporting Party, the Administrator, or the Dissemination Agent
in other than that person’s official capacity.
SECTION 15. Severability. In case any section or provision of this Disclosure Agreement,
or any covenant, stipulation, obligation, agreement, act, or action, or part thereof, made, assumed,
entered into, or taken thereunder, or any application thereof, is for any reasons held to be illegal or
invalid, such illegality or invalidity shall not affect the remainder thereof or any other section or
provision thereof or any other covenant, stipulation, obligation, agreement, act, or action, or part thereof,
made, assumed, entered into, or taken thereunder (except to the extent that such remainder or section or
provision or other covenant, stipulation, obligation, agreement, act, or action, or part thereof, is wholly
dependent for its operation on the provision determined to be invalid), which shall be construed and
enforced as if such illegal or invalid portion were not contained therein, nor shall such illegality or
invalidity of any application thereof affect any legal and valid application thereof, and each such section,
provision, covenant, stipulation, obligation, agreement, act, or action, or part thereof, shall be deemed to
be effective, operative, made, entered into, or taken in the manner and to the full extent permitted by
law.
SECTION 16. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of
the Reporting Parties, the Administrator, the Dissemination Agent, the Issuer, the Participating
Underwriter, and the Owners and the beneficial owners from time to time of the Bonds, and shall create
no rights in any other person or entity. Nothing in this Disclosure Agreement is intended or shall act to
disclaim, waive, or otherwise limit the duties of the Issuer under federal and state securities laws.
SECTION 17. Dissemination Agent Compensation. The fees and expenses incurred by the
Dissemination Agent for its services rendered in accordance with this Disclosure Agreement constitute
Annual Collection Costs and will be included in the Annual Installments as provided in the annual
updates to the Service and Assessment Plan. The Issuer shall pay or reimburse the Dissemination Agent,
but only with funds to be provided from the Annual Collection Costs component of the Annual
Installments collected from the property owners in Improvement Area #1, for the fees and expenses for
its services rendered in accordance with this Disclosure Agreement.
SECTION 18. Administrator Compensation. The fees and expenses incurred by the
Administrator for its services rendered in accordance with this Disclosure Agreement constitute Annual
Collection Costs and will be included in the Annual Installments as provided in the annual updates to
13
the Service and Assessment Plan. The Administrator has entered into a separate agreement with the
Issuer, which agreement governs the administration of Improvement Area #1, including the payment of
the fees and expenses of the Administrator for its services rendered in accordance with this Disclosure
Agreement.
SECTION 19. Governing Law. This Disclosure Agreement shall be governed by the laws of
the State of Texas.
SECTION 20. Notice. Any written notice required to be given or made hereunder among or
between any of the Reporting Parties, the Administrator, the Dissemination Agent and/or Participating
Underwriter, shall be given or made by e-mail, hand delivery, overnight courier, or by United States
mail, certified or registered mail, return receipt requested, postage prepaid, at the addresses listed below
or at such other addresses as any be specified in writing by any party hereto to the other parties hereto.
If the required notice is provided or delivered by e-mail, the sender must request a read or delivery receipt
from the recipient confirming that the recipient received the e-mail or the e-mail was delivered with such
notice. Failure of any party to this Disclosure Agreement or Significant Homebuilder to provide proof
of an e-mail read receipt or delivery receipt does not constitute a breach or default by such party or
Significant Homebuilder under this Disclosure Agreement.
If to Developer: Bloomfield Homes, L.P.
1050 E. State Hi hwa 114, Suite 210
Southlake, Texas 76092
Email: don bloomfieldhomes.net
If to the Trustee or
Dissemination A ent: Re ions Ban
Attn: Corporate Trust Services
1717 McKinne Avenue
Dallas, Texas 75202
Email: Shawn.bednasek re ions.com
If to Administrator: P3Works, LLC
9284 Huntin ton Square, Ste 100
North Richland Hills, Texas 76182
Email: admin p3-works.com
If to the Issuer: Cit of Anna
Attn: Cit Mana e
120 W. 7th Street
Anna, Texas 75409
Email: mmarchand annatexas.ov
If to Participatin Underwriter: FMSbonds, Inc.
5 Cowbo s Wa , Suite 300-25
Frisco, Texas 75034
E-mail: Tdavenport fmsbonds.com
14
SECTION 21. Term of Disclosure Agreement. Except for surviving indemnities of the
parties to this Disclosure Agreement, this Disclosure Agreement terminates on the earlier of (i) the first
date on which none of the Bonds remain Outstanding and (ii) the first date on which the reporting
obligations of all Reporting Parties have terminated in accordance with the terms of this Disclosure
Agreement.
SECTION 22. Counterparts. This Disclosure Agreement 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. The Developer, the Administrator, and the Dissemination Agent agree that electronic
signatures to this Disclosure Agreement may be regarded as original signatures.
Signature pages follow.
SIGNATURE PAGE OF CONTINUING DISCLOSURE AGREEMENT OF DEVELOPER
S-1
Regions Bank,
Dissemination A ent
B :
Authorized Office
SIGNATURE PAGE OF CONTINUING DISCLOSURE AGREEMENT OF DEVELOPER
S-2
DEVELOPER:
Bloomfield Homes, L.P., a Texas limited
partnership
By: Bloomfield Properties, Inc., a Texas
corporation, its General Partner
By: ___________________________
Donald J. Dykstra, its President
SIGNATURE PAGE OF CONTINUING DISCLOSURE AGREEMENT OF DEVELOPER
S-3
P3Works, LLC,
Administrato
B :
Name:
Title:
A-4
EXHIBIT A
CITY OF ANNA, TEXAS,
SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2025
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2
IMPROVEMENT AREA #1 PROJECT)
DEVELOPER QUARTERLY REPORT
INSERT QUARTERLY ENDING DAT ]
Delivery Date: _____________, 20__
CUSIP Numbers: [Insert CUSIP Numbers]
DISSEMINATION AGENT
Name: Regions Bank
Address:
City:
Telephone:
Contact Person: Attn:
I. Expenditures Paid from Accounts under Indenture
1. TOTAL BUDGETED COSTS REQUIRED TO COMPLETE IMPROVEMENT AREA
1 PROJECTS: $________________
2. Of the budgeted costs for Improvement Area #1 Projects shown in the Service and
Assessment Plan:
a. Actual costs drawn from the Improvement Area Improvement Account1:
b. Actual costs drawn from the Major Improvement Account2
c. Actual costs drawn from the Developer Improvement Account3
1 Improvement Area Improvement Account means the account titled Improvement Area #1 Bond Improvement
Account held under the Project Fund in the Indenture.
2 Not applicable.
3 Not applicable.
A-5
II. Status of Improvement Area #1 Projects
Projected/actual completion date of the Improvement Area #1 Projects
1. [Actual/Expected] date of completion of the Improvement Area #1 Projects:
2. Explanation of any delay/change in projected completion date since last Quarterly
Report was filed: [_____________________________________________________]
III. Unit Mix in Improvement Area #1
Product Type Number of Units
Sin le Famil 50’
Sin le Famil 60’
IV. Lot Status in Improvement Area #1
Of the 171 lots in Improvement Area #1, what is the status:
1. Planned lots as of the date of issuance of the Bonds: 171
2. Planned lots as of the date of this Quarterly Report: _______
3. Lots developed: _______
4. Lots platted:
5. Expected completion date of all lots in Improvement Area #1 (if incomplete):
V. Ownership of Lots/Units in Improvement Area #1
PLANNED LOTS IN IMPROVEMENT AREA #1: 171
Of the 171 lots in Improvement Area #1:
1. Number of lots owned by the Developer: _______
2. Number of lots under contract but not closed to Homebuilder(s): _______
3. Number of lots owned by all Homebuilder(s): _______4
a. a. Number of lots owned by [insert name of Homebuilder]: _______5
b. b. Number of lots owned by [insert name of Homebuilder]: _______
4. Number of units owned by homeowners: _______
4 If Developer is using EMMA filing assistance software, a chart containing the Quarterly Information provided under
this item will be generated. If Developer is not using EMMA filing assistance software, Developer shall prepare a
chart containing such Quarterly Information.
5 Include a line item for each individual Homebuilder.
A-6
VI. Home Sales Information in Improvement Area #1
PLANNED HOMES IN IMPROVEMENT AREA #1: 171
Of the 171 homes planned for Improvement Area #1:
1. How many total building permits were issued during the current quarter? _______
a. Number of building permits issued during the current quarter for [insert name
of Homebuilder]: _______6
b. Number of building permits issued during the current quarter for [insert name
of Homebuilder]: _______6
2. How many total homes have closed with homebuyers during the current quarter?
a. Number of homes closed with homebuyers during the current quarter for
insert name of Homebuilder]: _______6
b. Number of homes closed with homebuyers during the current quarter for
insert name of Homebuilder]: _______]6
3. How many total homes have closed with homebuyers cumulatively? _______
a. Number of homes closed with homebuyers cumulatively for [insert name of
Homebuilder]: _______6
b. Number of homes closed with homebuyers cumulatively for [insert name of
Homebuilder]: _______6
VII. Amenities
TOTAL [EXPECTED/ACTUAL] COSTS OF AMENITIES: $[________________]
Of the $[_______] [expected/actual] costs of the Amenities:
1. Amount spent as of Quarterly Ending Date: $[_______]
2. [Actual/Expected] completion date of Amenities: [_______]
VIII. Material Changes
Describe any material changes, if applicable:
1. Permits and Approvals - Since the issuance of the Bonds, have there been any material
changes to permits or development approvals (including any zoning) impacting the
development of the land subject to the Assessments securing the Bonds, which were not
disclosed in a previously filed Quarterly Report? If so, describe the material changes.
2. Mortgage Loans - Since the issuance of the Bonds, have there been any material changes to
mortgage loans (whether changes to an existing loan or incurrence of a new mortgage loan),
6 Include a line item for each individual Homebuilder.
A-7
if applicable, for the land subject to the Assessments securing the Bonds, which were not
disclosed in a previously filed Quarterly Report? If so, describe the material changes.
3. Builder Contracts - Since the issuance of the Bonds, have there been any material changes
to builder contracts (including but not limited to changes to price, substantial completion
dates, number of lots, or other terms) with respect to the land subject to the Assessments
securing the Bonds, which were not disclosed in a previously filed Quarterly Report? If so,
describe the material changes.
4. Ownership - Since the issuance of the Bonds, other than a sale to a homebuilder pursuant to
a Lot Purchase Agreement, has there been any sale, assignment or transfer of ownership of
lands subject to the Assessments securing the Bonds by the Developer to any third-party
developer/land bank, which was not disclosed in a previously filed Quarterly Report? If so,
provide the name of the third-party and indicate whether this third-party developer/land bank
has executed a Developer Acknowledgement pursuant to the Disclosure Agreement?
5. Reserved.
6. Amendments – Since the issuance of the Bonds and except as otherwise disclosed in a
previously filed Quarterly Report, (i) describe any amendments or waivers to any provision
of the Disclosure Agreement, including a narrative explanation of the reason for the
amendment or waiver and its impact on the type of financial information or operating data
being presented by the Reporting Parties and (ii) include a copy of the amendment, as
applicable.
7. Other – Provide any other material information that should be disclosed.
B-1
EXHIBIT B
NOTICE TO MSRB OF FAILURE TO
PROVIDE QUARTERLY INFORMATION][FILE QUARTERLY REPORT]
DATE]
Name of Issuer: Cit of Anna, Texas
Name of Bond Issue: Special Assessment Revenue Bonds, Series 2025 (Crystal Park
Public Improvement District No. 2 Improvement Area #1 Project)
the “Bonds”)
CUSIP Numbers: [insert CUSIP Numbers]
Date of Deliver : , 20
NOTICE IS HEREBY GIVEN that ___________________________________, a
the [“Developer1”] [“Significant Homebuilder”]) has not provided the
Quarterly Information][Quarterly Report] [the [Quarterly Information][Quarterly Report] was not
filed in a timely manner due to [______________________]] for the period ending on [Insert
Quarterly Ending Date] with respect to the Bonds as required by the Continuing Disclosure
Agreement of Developer related to such Bonds, by and among Bloomfield Homes L.P., a Texas
limited partnership (the “Developer”), P3Works, LLC, as Administrator, and Regions Bank, as
Dissemination Agent. The [Developer][Significant Homebuilder] anticipates that the [Quarterly
Information][Quarterly Report] will be [provided][filed] by _______________.
Dated: _________________
Regions Bank,
on behalf of the Develope ,
as Dissemination A ent
B :
Title:
cc: City of Anna, Texas
1 If applicable, replace with applicable successor(s)/assign(s).
C-1
EXHIBIT C
TERMINATION NOTICE
DATE]
Name of Issuer: Cit of Anna, Texas
Name of Bond Issue: Special Assessment Revenue Bonds, Series 2025 (Crystal Park
Public Improvement District No. 2 Improvement Area #1 Project)
the “Bonds”)
CUSIP Numbers. [insert CUSIP Numbers]
Date of Deliver : , 20
FMSbonds, Inc.
5 Cowboys Way, Suite 300-25
Frisco, Texas 75034
Regions Bank
1717 McKinney Avenue
Dallas, Texas 75202
City of Anna, Texas
120 W. 7th Street
Anna, Texas 75409
Bloomfield Homes, L.P.
1050 E. State Highway 114, Suite 210
Southlake, Texas 76092
Si nificant Homebuilde ]
NOTICE IS HEREBY GIVEN that ___________________________________, a
the [“Developer1”] [“Significant Homebuilder”]) is no longer
responsible for providing [any Quarterly Information][the Quarterly Report] with respect to the
Bonds, thereby terminating such party’s reporting obligations under the Continuing Disclosure
Agreement of Developer related to such Bonds, by and among Bloomfield Homes L.P., a Texas
limited partnership (the “Developer”), P3Works, LLC, as Administrator, and Regions Bank, as
Dissemination Agent.
Dated: _________________
P3Works, LLC
on behalf of [Developer][Si nificant Homebuilde ],
as Administrator)
B :
Title:
1 If applicable, replace with applicable successor(s)/assign(s).
D-1
EXHIBIT D
CERTIFICATION LETTER
DATE]
Name of Issuer: Cit of Anna, Texas
Name of Bond Issue: Special Assessment Revenue Bonds, Series 2025 (Crystal Park
Public Improvement District No. 2 Improvement Area #1 Pro ect)
CUSIP Numbers: [insert CUSIP Numbers]
Quarterl Endin Date: , 20
Re: Quarterly Report for Crystal Park Public Improvement District No. 2 – Improvement Area #1
To whom it may concern:
Pursuant to the Continuing Disclosure Agreement of Developer related to the captioned
Bonds by and among Bloomfield Homes L.P., a Texas limited partnership1 (the “Developer”),
P3Works, LLC, as Administrator, and Regions Bank, as Dissemination Agent, this letter
constitutes the certificate stating that the Quarterly Information, provided by
Developer][___________, as a “Significant Homebuilder”], contained in this Quarterly Report
herein submitted by the Administrator, on behalf of the [Developer][Significant Homebuilder],
constitutes the [portion of the] Quarterly Report required to be furnished by the
Developer][Significant Homebuilder]. Any and all Quarterly Information, provided by the
Developer][Significant Homebuilder], contained in this Quarterly Report for the three month
period ending on [Insert Quarterly Ending Date], to the best of my knowledge, is true and correct,
as of [insert date].
Please do not hesitate to contact our office if you have and questions or comments.
Bloomfield Homes, L.P., a Texas limited
partnership
By: Bloomfield Properties, Inc., a Texas
corporation, its General Partner
By: ___________________________
Donald J. Dykstra, its President
OR
SIGNIFICANT HOMEBUILDER
as Si nificant Homebuilder)]
B :
Name:
Title:
1 If applicable, replace with applicable successor(s)/assign(s).
E-1
EXHIBIT E
FORM OF ACKNOWLEDGEMENT OF ASSIGNMENT
OF DEVELOPER REPORTING OBLIGATIONS
DATE]
INSERT ASSIGNEE CONTACT INFORMATION]
Re: Crystal Park Public Improvement District No. 2 – Improvement Area #1 – Continuing
Disclosure Obligation
Dear ______________,
Per [Insert name of applicable agreement], as of _________, 20__, you have been assigned
and have assumed the obligations, requirements, or covenants to construct one or more of the
Improvement Area #1 Projects or Amenities (as those terms are defined in the Disclosure
Agreement of Developer (as defined herein)) within Improvement Area #1 of the Crystal Park
Public Improvement District No. 2 (the “District”).
Pursuant to Section 2 of the Continuing Disclosure Agreement of Developer
the “Disclosure Agreement of Developer”) by and among Bloomfield Homes L.P., a Texas
limited partnership (the “Developer”), P3Works, LLC (the “Administrator”), and Regions Bank
the “Dissemination Agent”), with respect to the “City of Anna, Texas, Special Assessment
Revenue Bonds, Series 2025 (Crystal Park Public Improvement District No. 2 Improvement Area
1 Project),” any person that, through assignment, assumes the obligations, requirements, or
covenants to construct one or more of the Improvement Area #1 Projects or Amenities is defined
as a Developer.
As a Developer, pursuant to Section 5 of the Disclosure Agreement of Developer, you
acknowledge and assume the reporting obligations of the Disclosure Agreement of Developer for
the property which is owned as detailed in the Disclosure Agreement of Developer, which is
included herewith.
Sincerely,
Bloomfield Homes, L.P., a Texas limited
partnership
By: Bloomfield Properties, Inc., a Texas
corporation, its General Partner
By: ___________________________
Donald J. Dykstra, its President
Acknowled ed b :
INSERT ASSIGNEE NAME]
B :
Title:
F-1
EXHIBIT F
FORM OF SIGNIFICANT HOMEBUILDER ACKNOWLEDGEMENT
DATE]
INSERT SIGNIFICANT HOMEBUILDER CONTACT INFORMATION]
Re: Crystal Park Public Improvement District No. 2 – Improvement Area #1 – Continuing
Disclosure Obligation
Dear ______________,
As of _________, 20__, you own ____ lots within Improvement Area #1 of Crystal Park
Public Improvement District No. 2 (the “District”). Pursuant to Section 2 of the Continuing
Disclosure Agreement of Developer related to the captioned Bonds (the “Disclosure Agreement
of Developer”) by and among Bloomfield Homes L.P., a Texas limited partnership (the
Developer”), P3Works, LLC (the “Administrator”), and Regions Bank (the “Dissemination
Agent”), with respect to the “City of Anna, Texas, Special Assessment Revenue Bonds, Series
2025 (Crystal Park Public Improvement District No. 2 Improvement Area #1 Project),” any entity
that owns 17 or more of the single family residential lots within Improvement Area #1 of the
District is defined as a Significant Homebuilder.
As a Significant Homebuilder, pursuant to Section 6 of the Disclosure Agreement of
Developer, you acknowledge and assume the reporting obligations under Sections 3 and 4(b) of
the Disclosure Agreement of Developer for the property which is owned as detailed in the
Disclosure Agreement of Developer, which is included herewith.
Sincerely,
Bloomfield Homes, L.P., a Texas limited
partnership
By: Bloomfield Properties, Inc., a Texas
corporation, its General Partner
By: ___________________________
Donald J. Dykstra, its President
Acknowled ed b :
INSERT ASSIGNEE NAME]
B :
Title”
THIS PAGE IS LEFT BLANK INTENTIONALLY.
APPENDIX F
FORM OF CFA AGREEMENT
1
714912017v1
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2 IMPROVEMENT AREA
1 CONSTRUCTION, FUNDING, AND ACQUISITION AGREEMENT
THIS CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2
IMPROVEMENT AREA #1 CONSTRUCTION, FUNDING, AND ACQUISITION
AGREEMENT (this “Agreement”), dated as of November 17, 2025, is by and between the CITY
OF ANNA, TEXAS, a home-rule municipality of the State of Texas (the “City”), and
BLOOMFIELD HOMES, L.P., a Texas limited partnership (the “Developer”).
ARTICLE I
DEFINITIONS
The following terms shall have the meanings ascribed to them in this Article I for purposes
of this Agreement. Unless otherwise indicated, any other terms, capitalized or not, when used
herein shall have the meanings ascribed to them in the Indenture (as hereinafter defined).
Act” means the Public Improvement District Assessment Act, Texas Local Government
Code, Chapter 372, as amended.
Actual Costs” means the costs of the Improvement Area #1 Projects actually paid or
incurred for construction and installation of the Improvement Area #1 Projects in accordance with
the Service and Assessment Plan.
Administrator” means, initially, P3 Works, LLC, or any other individual or entity
designated by the City to administer the District.
Annual Service Plan Update” means the annual update to the Service and Assessment
Plan conducted by the Administrator pursuant to the Service and Assessment Plan and approved
by ordinance adopted by the City.
Assessments” shall have the meaning given to it in the Indenture.
Authorized Improvements” means improvements authorized by Section 372.003(b) of
the Act.
Bond Ordinance” means the ordinance adopted by the City Council on November 17,
2025 authorizing the issuance of the Bonds pursuant to the Indenture.
Bonds” means the City’s bonds designated "City of Anna, Texas, Special Assessment
Revenue Bonds, Series 2025 (Crystal Park Public Improvement District No. 2 Improvement Area
1 Project)".
Budgeted Costs” means the anticipated, agreed upon costs of the Improvement Area #1
Projects as shown in Exhibit B-1 of the Service and Assessment Plan.
2
Certification for Payment” means a certificate, substantially in the form of Exhibit B
hereto or such other form agreed to by the Developer, the Administrator and the City
Representative, executed by an engineer, construction manager or other person or entity acceptable
to the City, as evidenced by the signature of a City Representative, provided no more frequently
than once per each month to the City Representative and the Trustee, specifying the amount of
work performed and the amount charged for that work, including materials and labor costs,
presented to the Trustee to request payment for Actual Costs of Improvement Area #1 Projects
under the Indenture.
City Inspector” means an individual employed by or an agent of the City whose job is,
in part or in whole, to inspect infrastructure to be owned by the City for compliance with all rules
and regulations applicable to the development and the infrastructure inspected.
City Manager” means the City Manager of the City, or its designee.
City Representative” means the City Manager, or any other official or agent of the City
later authorized by the City to undertake the action referenced herein.
Closing Disbursement Request” means the certificate, substantially in the form of
Exhibit A hereto or such other form agreed to by the Developer, Administrator, and City
Representative, executed by an engineer, construction manager or other person or entity acceptable
to the City, as evidenced by the signature of a City Representative, specifying the amounts to be
disbursed for the costs related to the creation of the District.
Construction Contracts” means the contracts for the construction of an Improvement
Area #1 Project. “Construction Contract” means any one of the Construction Contracts.
Costs” means the Budgeted Costs or the Actual Costs of an Improvement Area #1 Project
as reflected in a Construction Contract, if different than the Budgeted Costs.
Costs of Issuance Account” means the account of such name in the Project Fund created
under Section 6.1 of the Indenture.
Cost Overrun” means, with respect to each Improvement Area #1 Project, the Actual
Cost, as appropriate, of such Improvement Area #1 Project in excess of the Budgeted Cost.
Cost Underrun” has the meaning assigned such term in Section 4.04 hereof
Development Agreement” means that certain Development Agreement, effective as of
January 11, 2022, among the City, the Developer, Marquin Miller, F.A. Miller and Virgil Wren
Miller, as amended from time to time.
District” shall mean the Crystal Park Public Improvement District No. 2 created February
25, 2025.
3
Final Completion” means completion of an Improvement Area #1 Project in compliance
with existing City standards for dedication under the City’s ordinances and the Development
Agreement.
Improvement Area #1” means the initial improvement area to be developed and
generally shown in Appendix A to the Service and Assessment Plan, as specifically depicted and
described as the sum of all parcels shown in Exhibit F-1 to the Service and Assessment Plan.
Improvement Area #1 Improvements” mean the Authorized Improvements which only
benefit Improvement Area #1, which are described in Section III.B of the Service and Assessment
Plan.
Improvement Area #1 Projects” mean (i) the pro rata portion of the Major
Improvements allocable to Improvement Area #1 and (ii) the Improvement Area #1
Improvements.
Improvement Area #1 Bond Improvement Account” means the account of such name
in the Project Fund created under Section 6.1 of the Indenture.
Indenture” means that certain Indenture of Trust between the City and Regions Bank, as
trustee, dated as of [INDENTURE DATE], 2025 relating to the Bonds.
Major Improvements” means the Authorized Improvements which benefit all of the
property within the District and as described in Section III.A of the Service and Assessment Plan.
Plans” means the plans, specifications, schedules and related construction contracts for
the Improvement Area #1 Projects, respectively, approved pursuant to the applicable standards,
ordinances, procedures, policies and directives of the City, the Development Agreement, and any
other applicable governmental entity.
Project Fund” means the fund, including the accounts created and established under such
fund, where monies from the proceeds of the sale of the Bonds, excluding those deposited in other
funds in accordance with the Indenture, shall be deposited, and the fund by such name created
under the Indenture.
Service and Assessment Plan” means the Crystal Park Public Improvement District No.
2 Service and Assessment Plan adopted by a City ordinance on November 17, 2025 by the City
Council, prepared pursuant to the Act.
Substantial Completion” means the time at which the construction of an Improvement
Area #1 Project (or specified segment, section or part thereof) has progressed to the point where
such Improvement Area #1 Project (or a specified segment, section or part thereof) is sufficiently
complete in accordance with the Construction Contracts related thereto so that such Improvement
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Area #1 Project (or a specified segment, section or part thereof) can be utilized for the purposes
for which it is intended.
ARTICLE II
RECITALS
Section 2.01. The District and the Improvement Area #1 Projects.
a) The City has created the District under the Act for the financing of, among other
things, the acquisition, construction and installation of the Improvement Area #1 Projects.
b) The City has authorized the issuance of the Bonds in accordance with the provisions
of the Act, the Bond Ordinance and the Indenture, the proceeds of which Bonds shall be used, in
part, to finance a portion of the Improvement Area #1 Projects in accordance with the terms and
limitations of the Indenture, the Development Agreement, this Agreement, and the Service and
Assessment Plan.
c) All Improvement Area #1 Projects are eligible to be financed with proceeds of the
Bonds and the Assessments to the extent specified herein.
d) The proceeds from the issuance and sale of the Bonds shall be deposited in
accordance with the Indenture.
e) The Developer will undertake, oversee, or ensure the construction and development
of the Improvement Area #1 Projects for acquisition and acceptance by the City, in accordance
with the terms and conditions contained in the Development Agreement and this Agreement.
Section 2.02. Agreements. In consideration of the mutual promises and covenants set forth
herein, and for other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the City and the Developer agree that the foregoing recitals, as applicable to each,
are true and correct and further make the agreements set forth herein.
ARTICLE III
FUNDING
Section 3.01. Bonds.
a) The City, in connection with this Agreement, is proceeding with the issuance and
delivery of the Bonds.
b) The projects to be financed in part with the proceeds of the Bonds are the
Improvement Area #1 Projects. The payment of Costs from the proceeds of the Bonds for such
Improvement Area #1 Projects shall be made from the Improvement Area #1 Bond Improvement
Account of the Project Fund established under the Indenture.
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c) The City’s obligation with respect to the payment of the Costs of the Improvement
Area #1 Projects shall be limited to the lesser of the Actual Costs or Budgeted Costs, and shall be
payable solely from amounts on deposit for the payment of such Costs as provided herein and in
the Indenture. The Developer agrees and acknowledges that it is responsible for all Cost Overruns
and all expenses related to the Improvement Area #1 Projects, qualified, however, by the
distribution of Cost Underrun monies, as detailed in Section 4.04.
d) The City shall have no responsibility whatsoever to the Developer with respect to
the investment of any funds held in the Project Fund by the Trustee under the provisions of the
Indenture, including any loss of all or a portion of the principal invested or any penalty for
liquidation of an investment.
e) The Developer acknowledges that any lack of availability of amounts in the funds
or accounts established in the Indenture to pay the Costs of the Improvement Area #1 Projects
shall in no way diminish any obligation of the Developer with respect to the construction of or
contributions for the Improvement Area #1 Projects required by this Agreement, the Development
Agreement, or any other agreement to which the Developer is a party or any governmental
approval to which the Developer or any land within the District is subject.
Section 3.02 Funds and Accounts. All disbursements from the Improvement Area #1
Bond Improvement Account of the Project Fund shall be made by the City in accordance with
provisions of the Development Agreement, the Service and Assessment Plan, this Agreement and
the Indenture.
ARTICLE IV
CONSTRUCTION OF THE IMPROVEMENT AREA #1 PROJECTS
Section 4.01. Duty of Developer to Construct.
a) All Improvement Area #1 Projects shall be constructed by or at the direction of the
Developer in accordance with the Plans and in accordance with this Agreement and the
Development Agreement. The Developer shall perform, or cause to be performed, all of its
obligations and shall conduct, or cause to be conducted, all operations with respect to the
construction of Improvement Area #1 Projects in a good, workmanlike and commercially
reasonable manner, with the standard of diligence and care normally employed by duly qualified
persons utilizing their commercially reasonable efforts in the performance of comparable work
and in accordance with generally accepted practices appropriate to the activities undertaken. The
Developer shall employ at all times adequate staff or consultants with the requisite experience
necessary to administer and coordinate all work related to the design, engineering, acquisition,
construction and installation of all Improvement Area #1 Projects, to be acquired and accepted by
the City, from the Developer as provided in this Agreement.
b) The Developer shall not be relieved of its obligation to construct or cause to be
constructed each Improvement Area #1 Project and, upon completion, inspection, and acceptance,
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convey each such Improvement Area #1 Project to the City, in accordance with the terms hereof,
even if there are insufficient funds in the Project Fund or other funds or account created under the
Indenture to pay the Actual Costs thereof. In any event, this Agreement shall not affect any
obligation of the Developer under any other agreement to which the Developer is a party or any
governmental approval to which the Developer or any land within the District is subject, with
respect to the Improvement Area #1 Projects required in connection with the development of the
land within the District.
Section 4.02. No Competitive Bidding. The Improvement Area #1 Projects shall not
require competitive bidding pursuant to Section 252.022(a)(9) of the Texas Local Government
Code, as amended.
Section 4.03. Independent Contractor. In performing this Agreement, the Developer is
an independent contractor and not the agent or employee of the City with respect to the
Improvement Area #1 Projects.
Section 4.04. Remaining Funds After Completion of an Improvement Area #1 Project.
Upon the Final Completion of any Improvement Area #1 Project (or any segment or section
thereof) and payment of all outstanding invoices for such Improvement Area #1 Project (or
segment or section thereof), if the Actual Cost of such Improvement Area #1 Project (or segment
or section thereof) is less than the Budgeted Cost of such Improvement Area #1 Project (a “Cost
Underrun”), any remaining Budgeted Cost may be made available to pay Cost Overruns on any
other Improvement Area #1 Project, including Improvement Area #1 Projects in a different
improvement category shown in the Service and Assessment Plan. Any Cost Underrun for any
Improvement Area #1 Project is available to pay Cost Overruns on any other Improvement Area
1 Project. If, upon Final Completion of all Improvement Area #1 Projects in any improvement
category, there are funds remaining in any improvement categories, those funds can then be used
to reimburse the Developer for any qualifying costs of Improvement Area #1 Projects that have
not been previously paid.
The Administrator shall confirm that such remaining amounts are available to pay such
Cost Overruns, and the Developer, the Administrator and the City Representative shall promptly
agree on how to apply such moneys to the costs of other Improvement Area #1 Projects, subject
to the costs described in the Service and Assessment Plan. The use of such moneys shall be
included in the next Annual Service Plan Update.
Section 4.05. Contracts and Change Orders. The Developer shall be responsible for
entering into all contracts and any supplemental agreements (herein referred to as “change orders”)
required for the construction of the Improvement Area #1 Projects. Developer or its contractors
may approve and implement any change orders, even if such change order would increase the Cost
of an Improvement Area #1 Project, but the Developer shall be solely responsible for payment of
any Cost Overruns resulting from such change orders except to the extent amounts are available
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pursuant to Section 4.04. If any change order is for work that requires changes to be made by an
engineer to the construction and design documents and plans previously approved under Section
4.01, then such revisions made by an engineer must be submitted to the City for approval by the
City’s engineer prior to execution of the change order.
ARTICLE V
ACQUISITION, CONSTRUCTION, AND PAYMENT
Section 5.01. Payment Requests for Disbursements at Closing. In order to receive the
disbursement from the Costs of Issuance Account of the Project Fund or the Improvement Area
1 Bond Improvement Account of the Project Fund at closing of the Bonds, related to costs of
issuance of the Bonds or costs incurred in the creation of the District, the Developer shall execute
a Closing Disbursement Request, substantially in the form of Exhibit A hereto or otherwise
acceptable and agreed to by the City, to be delivered to the City no less than fifteen (15) business
days prior to the scheduled Closing Date for the Bonds for payment in accordance with the
provisions of the Indenture. In order to receive the disbursement for an Improvement Area #1
Project from the Improvement Area #1 Bond Improvement Account of the Project Fund at closing
of the Bonds, the Developer shall execute a Certification for Payment, substantially in the form of
Exhibit B hereto or otherwise agreed to by the City, to be delivered to the City no later than fifteen
15) business days prior to the scheduled Closing Date for the Bonds for payment in accordance
with the provisions of the Indenture. Upon approval by the City, the City shall submit a Closing
Disbursement Request or a Certification for Payment, as applicable, to the Trustee for
disbursement to be made from the Costs of Issuance Account of the Project Fund or the
Improvement Area #1 Bond Improvement Account of the Project Fund, as applicable.
Section 5.02. Certification for Payment for an Improvement Area #1 Project.
a) No payment hereunder shall be made from the Project Fund to the Developer for
work on an Improvement Area #1 Project until a Certification for Payment is received from the
Developer. Upon receipt of a Certification for Payment substantially in the form of Exhibit B
hereto (and all accompanying documentation required by the City) from the Developer, the City
Inspector shall conduct a review in order to confirm that such request is complete, that the work
with respect to such Improvement Area #1 Project identified therein for which payment is
requested was completed in accordance with all applicable governmental laws, rules and
regulations and applicable Plans therefor and with the terms of this Agreement, the Development
Agreement, and to verify and approve the Actual Cost of such work specified in such Certification
for Payment (collectively, the “Developer Compliance Requirements”). The City Inspector and/or
the City Representative shall also conduct such review as is required in his discretion to confirm
the matters certified in the Certification for Payment. The Developer agrees to cooperate with the
City Inspector and/or City Representative in conducting each such review and to provide the City
Inspector and/or City Representative with such additional information and documentation as is
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reasonably necessary for the City Inspector and/or City Representative to conclude each such
review.
b) Within fifteen (15) business days of receipt of any Certification for Payment, the
City Representative shall either (i) approve and execute the Certification for Payment and forward
the same to the Administrator for approval and delivery to the Trustee for payment to the
Developer in accordance with Section 5.03(a) hereof or (ii) in the event the City Representative
disapproves the Certification for Payment, give written notification to the Developer of the City
Representative’s disapproval, in whole or in part, of such Certification for Payment, specifying the
reasons for such disapproval and the additional requirements to be satisfied for approval of such
Certification for Payment. If a Certification for Payment seeking reimbursement is approved only
in part, the City Representative shall specify the extent to which the Certification for Payment is
approved and shall deliver such partially approved Certification for Payment to the Administrator
for approval in accordance with Section 5.03 hereof and delivery to the Developer in accordance
with Section 5.02(c) hereof, and any such partial work shall be processed for payment under
Section 5.03 notwithstanding such partial denial.
c) If the City Representative denies the Certification for Payment, the denial must be
in writing, stating the reason(s) for denial. The denial may be appealed to the City Council by the
Developer in writing within thirty (30) days of being denied by the City Representative. Denial
of the Certification for Payment by the City Council shall be attempted to be resolved by half-day
mediation between the parties in the event an agreement is not otherwise reached by the parties,
with the mediator’s fee being paid by Developer. The Certification for Payment shall not be
forwarded to the Trustee for payment until the dispute is resolved by the City and the Developer.
d) The Developer shall deliver the approved or partially approved Certification for
Payment to the Trustee for payment and the City shall direct the Trustee to make such payment
from the Project Fund in accordance with Section 5.03 below.
Section 5.03. Payment for Improvement Area #1 Project.
a) Upon receipt of a reviewed and approved Certification for Payment, the Trustee
shall make payment from the Improvement Area #1 Bond Improvement Account of the Project
Fund pursuant to the terms of the Certification for Payment and the Indenture in an amount not to
exceed the Budgeted Cost for the particular Improvement Area #1 Project, unless a Cost Overrun
amount has been approved for a particular Improvement Area #1 Project. If a Cost Overrun amount
has been approved, then the amount reimbursed shall not exceed the Budgeted Amount plus the
approved Cost Overrun amount.
b) Approved Certifications for Payment that await reimbursement shall not accrue
interest.
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c) Notwithstanding any other provisions of this Agreement, when payment is made,
the City shall direct the Trustee to make payment directly to the general contractor or supplier of
materials or services or jointly to Developer (or any permitted assignee of such Developer) and
the general contractor or supplier of materials or services, as indicated in an approved Certification
for Payment, out of available and appropriate funds in the Project Fund. If the request for payment
results in ninety percent (90%) or more of the Budgeted Costs for such Improvement Area #1
Project identified in such request for payment being paid, then the City shall direct the Trustee to
hold the payment until work with respect to that Improvement Area #1 Project has been completed
and accepted by the City. If an unconditional lien release related to the items referenced in the
Certification for Payment is attached to such Certification for Payment, the City shall direct the
Trustee to make such payment to the Developer or any permitted assignee of the Developer. In
the event the Developer provides a general contractor’s or supplier of materials’ unconditional lien
release for a portion of the work covered by a Certification for Payment, the City shall direct the
Trustee to make such payment directly to the Developer or any permitted assignee of the Developer
to the extent of such lien release.
d) Withholding Payments.
Nothing in this Agreement shall be deemed to prohibit the Developer or the City from
contesting in good faith the validity or amount of any mechanics or materialman’s lien and/or
judgment nor limit the remedies available to the Developer or the City with respect thereto,
including the withholding of any payment that may be associated with the exercise of such remedy,
so long as such delay in performance shall not subject the Improvement Area #1 Project to
foreclosure, forfeiture, or sale. In the event that any such mechanics or materialman’s lien and/or
judgment with respect to any Improvement Area #1 Project is contested, the Developer shall post
or cause delivery of a surety bond in the amount determined by the City or City may decline to
accept the Improvement Area #1 Projects until such mechanics or materialman’s lien and/or
judgment is satisfied.
ARTICLE VI
OWNERSHIP AND TRANSFER OF IMPROVEMENT AREA #1 PROJECT
Section 6.01. Improvement Area #1 Project to be Owned by the City– Title Evidence. If
required by the City, the Developer shall furnish to the City a preliminary title report for land with
respect to an Improvement Area #1 Project to be acquired and accepted by the City from the
Developer and not previously dedicated or otherwise conveyed to the City for review and approval
at least thirty (30) calendar days prior to the transfer of title of an Improvement Area #1 Project to
the City. The City shall approve the preliminary title report unless it reveals a matter which, in the
reasonable judgment of the City, could materially affect the City’s clean title or use and enjoyment
of any part of the property or easement covered by the preliminary title report. In the event the
City does not approve the preliminary title report, the City shall not be obligated to accept title to
the Improvement Area #1 Project until the Developer has cured such objections to title to the
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satisfaction of the City.
Section 6.02. Improvement Area #1 Project Constructed on City Land or Developer Land.
If the Improvement Area #1 Project is on land owned by the City, the City hereby grants to the
Developer a license to enter upon such land for purposes related to construction (and maintenance
pending acquisition and acceptance) of the Improvement Area #1 Project. If the Improvement
Area #1 Project is on land owned by the Developer, the Developer hereby grants to the City an
easement to enter upon such land for purposes related to inspection and maintenance (pending
acquisition and acceptance) of the Improvement Area #1 Project. The grant of the permanent
easement shall not relieve the Developer of any obligation to grant the City title to property and/or
easements related to the Improvement Area #1 Project as required by the Development Agreement
or as should in the City’s reasonable judgment be granted to provide for convenient access to and
routine and emergency maintenance of such Improvement Area #1 Project. The provisions for
inspection and acceptance of such Improvement Area #1 Project otherwise provided herein shall
apply.
ARTICLE VII
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 7.01. Representations, Covenants and Warranties of the Developer. The
Developer represents and warrants for the benefit of the City as follows:
a) Organization. The Developer is a limited partnership duly formed, organized and
validly existing under the laws of the State of Texas, is in compliance with the laws of the State of
Texas, and has the power and authority to own its properties and assets and to fulfill its obligations
in this Agreement and the Development Agreement and to carry on its business in the State of
Texas as now being conducted as hereby contemplated.
b) Authority. The Developer has the power and authority to enter into this Agreement
and has taken all action necessary to cause this Agreement to be executed and delivered, and this
Agreement has been duly and validly executed and delivered by the Developer.
c) Binding Obligation. This Agreement is a legal, valid and binding obligation of the
Developer, enforceable against the Developer in accordance with its terms, subject to bankruptcy
and other equitable principles.
d) Compliance with Law. The Developer shall not commit, suffer or permit any act
to be done in, upon or to the lands in the District or the Improvement Area #1 Projects in violation
of any law, ordinance, rule, regulation or order of any governmental authority or any covenant,
condition or restriction now or hereafter affecting the lands in the District or the Improvement
Area #1 Projects.
e) Requests for Payment. The Developer represents and warrants that (i) it will not
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request payment from the Project Fund for the acquisition construction or installation of any
improvements that are not part of the Costs associated with the Improvement Area #1 Projects,
and (ii) it will diligently follow all procedures set forth in this Agreement with respect to the
Certification for Payments.
f) Financial Records. For a period of two years after completion of the Improvement
Area #1 Projects, the Developer covenants to maintain proper books of record and account for the
construction of the Improvement Area #1 Projects and all Costs related thereto. Such accounting
books shall be maintained in accordance with generally accepted accounting principles, and shall
be available for inspection by the City or its agents at any reasonable time during regular business
hours on reasonable notice.
g) Plans. The Developer represents that it has obtained or will obtain approval of the
Plans from all appropriate departments of the City and from any other public entity or public utility
from which such approval must be obtained. The Developer further agrees that, subject to the
terms hereof, the Improvement Area #1 Projects have been or will be constructed in full
compliance with such Plans and any change orders thereto consistent with the Act, this Agreement
and the Development Agreement. Developer shall provide as-built plans for all Improvement Area
1 Projects to the City.
h) Additional Information. The Developer agrees to cooperate with all reasonable
written requests for nonproprietary information by the initial purchaser of the Bonds, the City
Manager and the City Representative related to the status of construction of the Improvement Area
1 Projects within the District, the anticipated completion dates for future improvements and any
other matter that the initial purchaser of the Bonds or City Representative deems material to the
investment quality of the Bonds.
i) Continuing Disclosure Agreement. The Developer agrees to provide the
information required pursuant to the Continuing Disclosure Agreement of the Developer executed
by the Developer in connection with the Bonds.
j) Tax Certificate. The City will deliver a certificate relating to the Bonds (such
certificate, as it may be amended and supplemented from time to time, being referred to herein as
the “Tax Certificate”) containing covenants and agreements designed to satisfy the requirements
of 26 U.S. Code Sections 103 and 141 through 150, inclusive, and the federal income tax
regulations issued thereunder relating to the use of the proceeds of the Bonds or of any monies,
securities or other obligations on deposit to the credit of any of the funds and accounts created by
the Indenture or this Agreement or otherwise that may be deemed to be proceeds of the Bonds
within the meaning of 26 U.S. Code Section 148 (collectively, “Bond Proceeds”).
The Developer covenants to provide, or cause to be provided, such facts and estimates as
the City reasonably considers necessary to enable it to execute and deliver its Tax Certificate. The
Developer further covenants that (i) such facts and estimates will be based on its reasonable
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expectations on the date of issuance of the Bonds and will be, to the best of the knowledge of the
officers of the Developer providing such facts and estimates, true, correct and complete as of that
date, and (ii) the Developer will make reasonable inquires to ensure such truth, correctness and
completeness. The Developer covenants that it will not make, or (to the extent that it exercises
control or direction) permit to be made, any use or investment of the Bond Proceeds (including,
but not limited to, the use of the Improvement Area #1 Projects) that would cause any of the
covenants or agreements of the City contained in the Tax Certificate to be violated or that would
otherwise have an adverse effect on the tax-exempt status of the interest payable on the Bonds for
federal income tax purposes.
k) Financial Resources. The Developer represents and warrants that it has the
financial resources, or the ability to obtain sufficient financial resources, to meet its obligations
under this Agreement, the Service and Assessment Plan and the Development Agreement.
Section 7.02. Indemnification and Hold Harmless. THE DEVELOPER SHALL
INDEMNIFY AND HOLD HARMLESS THE CITY INSPECTOR, THE CITY, ITS
OFFICIALS, EMPLOYEES, OFFICERS, REPRESENTATIVES AND AGENTS (EACH AN
INDEMNIFIED PARTY”), FROM AND AGAINST ALL ACTIONS, DAMAGES, CLAIMS,
LOSSES OR EXPENSE OF EVERY TYPE AND DESCRIPTION TO WHICH THEY MAY BE
SUBJECTED OR PUT: (I) BY REASON OF, OR RESULTING FROM THE BREACH OF ANY
PROVISION OF THIS AGREEMENT BY THE DEVELOPER; (II) THE NEGLIGENT
DESIGN, ENGINEERING, AND/OR CONSTRUCTION BY THE DEVELOPER OR ANY
ARCHITECT, ENGINEER OR CONTRACTOR HIRED BY THE DEVELOPER OF ANY OF
THE IMPROVEMENT AREA #1 PROJECTS ACQUIRED FROM THE DEVELOPER
HEREUNDER; (III) THE DEVELOPER’S NONPAYMENT UNDER CONTRACTS
BETWEEN THE DEVELOPER AND ITS CONSULTANTS, ENGINEERS, ADVISORS,
CONTRACTORS, SUBCONTRACTORS AND SUPPLIERS IN THE PROVISION OF THE
IMPROVEMENT AREA #1 PROJECTS; (IV) ANY CLAIMS OF PERSONS EMPLOYED BY
THE DEVELOPER OR ITS AGENTS TO CONSTRUCT THE IMPROVEMENT AREA #1
PROJECTS; OR (V) ANY CLAIMS AND SUITS OF THIRD PARTIES, INCLUDING BUT
NOT LIMITED TO DEVELOPER’S RESPECTIVE PARTNERS, OFFICERS, DIRECTORS,
EMPLOYEES, REPRESENTATIVES, AGENTS, SUCCESSORS, ASSIGNEES, VENDORS,
GRANTEES AND/OR TRUSTEES, REGARDING OR RELATED TO THE IMPROVEMENT
AREA #1 PROJECTS OR ANY AGREEMENT OR RESPONSIBILITY REGARDING THE
IMPROVEMENT AREA #1 PROJECTS, INCLUDING CLAIMS AND CAUSES OF ACTION
WHICH MAY ARISE OUT OF THE SOLE OR PARTIAL NEGLIGENCE OF AN
INDEMNIFIED PARTY (THE “CLAIMS”). NOTWITHSTANDING THE FOREGOING, NO
INDEMNIFICATION IS GIVEN HEREUNDER FOR ANY ACTION, DAMAGE, CLAIM,
LOSS OR EXPENSE DETERMINED BY A COURT OF COMPETENT JURISDICTION TO
BE DIRECTLY ATTRIBUTABLE TO THE WILLFUL MISCONDUCT OF ANY
INDEMNIFIED PARTY, DEVELOPER IS EXPRESSLY REQUIRED TO DEFEND CITY
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AGAINST ALL SUCH CLAIMS, AND CITY IS REQUIRED TO REASONABLY
COOPERATE AND ASSIST DEVELOPER IN PROVIDING SUCH DEFENSE.
IN ITS REASONABLE DISCRETION, THE CITY SHALL HAVE THE RIGHT TO
APPROVE OR SELECT DEFENSE COUNSEL TO BE RETAINED BY THE DEVELOPER IN
FULFILLING ITS OBLIGATIONS HEREUNDER TO DEFEND AND INDEMNIFY THE
INDEMNIFIED PARTIES, UNLESS SUCH RIGHT IS EXPRESSLY WAIVED BY THE CITY
IN WRITING. THE INDEMNIFIED PARTIES RESERVE THE RIGHT TO PROVIDE A
PORTION OR ALL OF THEIR/ITS OWN DEFENSE, AT THEIR/ITS SOLE COST;
HOWEVER, INDEMNIFIED PARTIES ARE UNDER NO OBLIGATION TO DO SO. ANY
SUCH ACTION BY AN INDEMNIFIED PARTY IS NOT TO BE CONSTRUED AS A
WAIVER OF THE DEVELOPER’S OBLIGATION TO DEFEND INDEMNIFIED PARTIES
OR AS A WAIVER OF THE DEVELOPER’S OBLIGATION TO INDEMNIFY INDEMNIFIED
PARTIES, PURSUANT TO THIS AGREEMENT. THE DEVELOPER SHALL RETAIN CITY-
APPROVED DEFENSE COUNSEL WITHIN SEVEN (7) BUSINESS DAYS OF WRITTEN
NOTICE FROM AN INDEMNIFIED PARTY THAT IT IS INVOKING ITS RIGHT TO
INDEMNIFICATION UNDER THIS AGREEMENT. IF THE DEVELOPER FAILS TO
RETAIN COUNSEL WITHIN SUCH TIME PERIOD, INDEMNIFIED PARTIES SHALL
HAVE THE RIGHT TO RETAIN DEFENSE COUNSEL ON ITS OWN BEHALF, AND THE
DEVELOPER SHALL BE JOINTLY AND SEVERALLY LIABLE FOR ALL REASONABLE
COSTS INCURRED BY INDEMNIFIED PARTIES.
THIS SECTION 7.02 SHALL SURVIVE THE TERMINATION OF THIS
AGREEMENT.
THE PARTIES AGREE AND STIPULATE THAT THIS INDEMNIFICATION
COMPLIES WITH THE CONSPICUOUSNESS REQUIREMENT AND THE EXPRESS
NEGLIGENCE TEST, AND IS VALID AND ENFORCEABLE AGAINST THE DEVELOPER.
Section 7.03. Use of Monies by City; Changes to Indenture. The City agrees not to take
any action or direct the Trustee to take any action to expend, disburse or encumber the monies held
in the Project Fund and any monies to be transferred thereto for any purpose other than the
purposes permitted by the Indenture. Prior to the acceptance of all the Improvement Area #1
Projects, the City agrees not to modify or supplement the Indenture without the approval of the
Developer if as a result or as a consequence of such modification or supplement: (a) the amount
of monies that would otherwise have been available under the Indenture for disbursement for the
Costs of the Improvement Area #1 Projects is reduced, delayed or deferred, (b) the obligations or
liabilities of the Developer is or may be substantially increased or otherwise adversely affected in
any manner, or (c) the rights of the Developer is or may be modified, limited, restricted or
otherwise substantially adversely affected in any manner.
Section 7.04. No Reduction of Assessments. The Developer agrees not to take any action
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or actions to reduce the total amount of such Assessments to be levied as of the effective date of
this Agreement.
ARTICLE VIII
TERMINATION
Section 8.01. Mutual Consent. This Agreement may be terminated by the mutual, written
consent of the City and the Developer, in which event the City may either execute contracts for or
perform any remaining work related to the Improvement Area #1 Projects not accepted by the City
or other appropriate entity and use all or any portion of funds on deposit in the Project Fund or
other amounts transferred to the Project Fund under the terms of the Indenture to pay for same,
and the Developer shall have no claim or right to any further payments for the Costs of an
Improvement Area #1 Project hereunder, except as otherwise may be provided in such written
consent.
Section 8.02. City’s Election for Cause.
a) The City, upon notice to the Developer and the passage of the cure period identified
in subsection (b) below, may terminate this Agreement, without the consent of the Developer if
the Developer shall breach any material covenant or default in the performance of any material
obligation hereunder.
b) If any such event described in Section 8.02(a) occurs, the City shall give written
notice of its knowledge of such event to the Developer, and the Developer agrees to promptly meet
and confer with the City Inspector and other appropriate City staff and consultants as to options
available to assure timely completion, subject to the terms of this Agreement, of the Improvement
Area #1 Projects. Such options may include, but not be limited to, the termination of this
Agreement by the City. If the City elects to terminate this Agreement, the City shall first notify
the Developer (and any mortgagee or trust deed beneficiary specified in writing by the Developer
to the City to receive such notice) of the grounds for such termination and allow the Developer a
minimum of 45 days to eliminate or to mitigate to the satisfaction of the City the grounds for such
termination. Such period may be extended, at the sole discretion of the City, if the Developer, to
the reasonable satisfaction of the City, is proceeding with diligence to eliminate or mitigate such
grounds for termination. If at the end of such period (and any extension thereof), as determined
reasonably by the City, the Developer has not eliminated or completely mitigated such grounds to
the satisfaction of the City, the City may then terminate this Agreement. In the event of the
termination of this Agreement, the Developer is entitled to payment for work accepted by the City
related to an Improvement Area #1 Project only as provided for under the terms of the Indenture
and this Agreement prior to the termination date of this Agreement. Notwithstanding the
foregoing, so long as the Developer has breached any material covenant or defaulted in the
performance of any material obligation hereunder, notice of which has been given by the City to
the Developer, and such event has not been cured or otherwise eliminated by the Developer, the
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City may in its discretion cause the Trustee to cease making payments for the Actual Costs of
Improvement Area #1 Projects, provided that the Developer shall receive payment of the Actual
Costs of any Improvement Area #1 Projects that were accepted by the City at the time of the
occurrence of such breach or default by the Developer upon submission of the documents and
compliance with the other applicable requirements of this Agreement.
c) If this Agreement is terminated by the City for cause, the City may either execute
contracts for or perform any remaining work related to the Improvement Area #1 Projects not
accepted by the City and use all or any portion of the funds on deposit in the Project Fund or other
amounts transferred to the Project Fund and the Developer shall have no claim or right to any
further payments for the Improvement Area #1 Projects hereunder, except as otherwise may be
provided upon the mutual written consent of the City and the Developer. The City shall have no
obligation to perform any work related to an Improvement Area #1 Project or to incur any expense
or cost in excess of the remaining balance of the Project Fund.
Section 8.03. Termination Upon Redemption or Defeasance of Bonds. This Agreement
will terminate automatically and with no further action by the City or the Developer upon the
redemption or defeasance of all outstanding Bonds (including any refunding bonds issued to refund
the Bonds) issued under the Indenture.
Section 8.04. Construction of the Improvement Area #1 Projects Upon Termination of
this Agreement. Notwithstanding anything to the contrary contained herein, upon the termination
of this Agreement pursuant to this Article VIII, the Developer shall perform its obligations with
respect to the Improvement Area #1 Projects in accordance with this Agreement and the
Development Agreement.
Section 8.05. Force Majeure. Whenever performance is required of a party hereunder,
that party shall use all due diligence and take all necessary measures in good faith to perform, but
if completion of performance is delayed by reasons of floods, earthquakes or other acts of God,
war, civil commotion, riots, strikes, picketing or other labor disputes, damage to work in progress
by casualty or by other cause beyond the reasonable control of the party (financial inability
excepted) (“Force Majeure”), then the specified time for performance shall be extended by the
amount of the delay actually so caused. The extension of time to perform allowed by this Section
8.05 shall not apply unless, upon the occurrence of an event of Force Majeure, the party needing
additional time to perform notifies the other party of the event of Force Majeure and the amount
of additional time reasonably required within ten (10) business days of the occurrence of the event
of Force Majeure.
ARTICLE IX
MISCELLANEOUS
Section 9.01. Limited Liability of City. The Developer agrees that any and all obligations
16
of the City arising out of or related to this Agreement are special obligations of the City, and the
City’s obligations to make any payments hereunder are restricted entirely to the moneys, if any, in
the Project Fund and from no other source. Neither the City, the City Inspector, City
Representative nor any other City employee, officer, official or agent shall incur any liability
hereunder to the Developer or any other party in their individual capacities by reason of their
actions hereunder or execution hereof.
Section 9.02. Audit. The City Inspector, City Representative or a finance officer of the
City shall have the right, during normal business hours and upon the giving of three business days’
prior written notice to a Developer, to review all books and records of the Developer pertaining to
costs and expenses incurred by the Developer with respect to any of the Improvement Area #1
Projects and any bids taken or received for the construction thereof or materials therefor.
Section 9.03. Notices. Any notice, payment or instrument required or permitted by this
Agreement to be given or delivered to any party shall be deemed to have been received when
personally delivered or transmitted by telecopy or facsimile transmission (which shall be
immediately confirmed by telephone and shall be followed by mailing an original of the same
within 24 hours after such transmission) or 72 hours following deposit of the same in any United
States Post Office, registered or certified mail, postage prepaid, addressed as follows:
To the City: City of Anna, Texas
Attn: City Manager
120 W. 7th Street
Anna, Texas 75409
With a copy to: Wolfe, Tidwell & McCoy, LLP
Attn: Clark McCoy
2591 Dallas Parkway, Suite 300
Frisco, Texas 75034
And to: McCall, Parkhurst & Horton L.L.P.
Attn: Rodolfo Segura Jr
717 North Harwood, Suite 900
Dallas, TX 75201
To Developer: Bloomfield Homes, L.P.
Donald J. Dykstra, President
1900 W. Kirkwood Blvd, Suite 2300B
Southlake, TX 76092
With a copy to: Greenberg Traurig, LLP
Attn: Drew Slone
2200 Ross Ave., Suite 5200
Dallas, Texas 75201
Any party may change its address or addresses for delivery of notice by delivering written
notice of such change of address to the other party.
17
The City shall advise the Developer of the name and address of any person who is to receive
any notice or other communication pursuant to this Agreement.
Section 9.04. Severability. If any part of this Agreement is held to be illegal or
unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given
effect to the fullest extent possible.
Section 9.05. Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the successors and assigns of the parties hereto. Any receivables due under this
Agreement may be assigned by the Developer without the consent of, but upon written notice to
the City pursuant to Section 9.03 of this Agreement. The obligations, requirements, or covenants
of this Agreement shall be able to be assigned to an affiliate or related entity of the Developer, or
any lien holder on the Property, without prior written consent of the City. The obligations,
requirements, or covenants of this Agreement shall not be assigned by the Developer to a non-
affiliate or non-related entity of the Developer without prior written consent of the City Manager,
except pursuant to a collateral assignment to any person or entity providing construction financing
to the Developer for an Improvement Area #1 Project, provided such person or entity expressly
agrees to assume all obligations of the Developer hereunder if there is a default under such
financing and such Person elects to complete the Improvement Area #1 Project. No such
assignment shall be made by the Developer or any successor or assignee of the Developer that
results in the City being an “obligated person” within the meaning of Rule 15c2-12 of the United
States Securities and Exchange Commission without the express written consent of the City. In
connection with any consent of the City, the City may condition its consent upon the acceptability
of the financial condition of the proposed assignee, upon the assignee’s express assumption of all
obligations of the Developer hereunder and/or upon any other reasonable factor which the City
deems relevant in the circumstances. In any event, any such assignment shall be in writing, shall
clearly identify the scope of the rights and/or obligations assigned. The City may assign by a
separate writing certain rights as described in this Agreement and in the Indenture, to the Trustee
and the Developer hereby consents to such assignment.
Section 9.06. Other Agreements. The obligations of the Developer hereunder shall be
those of a party hereto and not as an owner of property in the District. Nothing herein shall be
construed as affecting the City’s or the Developer’s rights or duties to perform their respective
obligations under other agreements, use regulations, ordinances or subdivision requirements
relating to the development of the lands in the District, including the applicable Construction
Contracts and the Development Agreement. To the extent there is a conflict between this
Agreement and the Development Agreement, the Development Agreement shall control. To the
extent there is a conflict between this Agreement and the Indenture, the Indenture shall control.
Section 9.07. Waiver. Failure by a party to insist upon the strict performance of any of
the provisions of this Agreement by any other party, or the failure by a party to exercise its rights
18
upon the default of any other party, shall not constitute a waiver of such party’s right to insist and
demand strict compliance by such other party with the terms of this Agreement thereafter.
Section 9.08. Merger. No other agreement, statement or promise made by any party or
any employee, officer or agent of any party with respect to any matters covered hereby that is not
in writing and signed by all the parties to this Agreement shall be binding.
Section 9.09. Parties in Interest. Nothing in this Agreement, expressed or implied, is
intended to or shall be construed to confer upon or to give to any person or entity other than the
City and the Developer any rights, remedies or claims under or by reason of this Agreement or any
covenants, conditions or stipulations hereof, and all covenants, conditions, promises and
agreements in this Agreement contained by or on behalf of the City or the Developer shall be for
the sole and exclusive benefit of the City and the Developer.
Section 9.10. Amendment. This Agreement may be amended upon agreement of the
parties, from time to time in a manner consistent with the Act, the Indenture, and the Bond
Ordinance by written supplement hereto and executed in counterparts, each of which shall be
deemed an original.
Section 9.11. Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original.
Section 9.12. Effective Date. This Agreement has been dated as of the date first above
written solely for the purpose of convenience of reference and shall become effective upon its
execution and delivery, on the Closing Date of the Bonds, by the parties hereto. All representations
and warranties set forth therein shall be deemed to have been made on the Closing Date of the
Bonds.
Section 9.13. Term. The term of this Agreement, other than the provisions contained in
Section 7.02, which shall survive the termination of this Agreement, shall be thirty (30) years or
upon redemption or defeasance of the Bonds (including any refunding bonds issued to refund the
Bonds) issued under the Indenture. If the Developer defaults under this Agreement or the
Development Agreement, this Agreement and the Development Agreement shall not terminate
with respect to the Costs of the Improvement Area #1 Projects that have been approved by the City
pursuant to a Certification for Payment prior to the date of default.
Section 9.14 No Waiver of Powers or Immunity. The City does not waive or surrender
any of its governmental powers, immunities, or rights except as necessary to allow Developer to
enforce its remedies under this Agreement.
Section 9.15. Statutory Verifications. The Developer makes the following representations
and covenants pursuant to Chapters 2252, 2271, 2274, and 2276, Texas Government Code, as
heretofore amended (the “Government Code”), in entering into this Agreement. As used in such
19
verifications, “affiliate” means an entity that controls, is controlled by, or is under common control
with the Developer within the meaning of SEC Rule 405, 17 C.F.R. § 230.405, and exists to make
a profit. Liability for breach of any such verification during the term of this Agreement shall
survive until barred by the applicable statute of limitations, and shall not be liquidated or otherwise
limited by any provision of this Agreement, notwithstanding anything in this Agreement to the
contrary.
a. Not a Sanctioned Company. The Developer represents that neither it nor
any of its parent company, wholly- or majority-owned subsidiaries, and other affiliates is
a company identified on a list prepared and maintained by the Texas Comptroller of Public
Accounts under Section 2252.153 or Section 2270.0201, Government Code. The foregoing
representation excludes the Developer and each of its parent company, wholly- or majority-
owned subsidiaries, and other affiliates, if any, that the United States government has
affirmatively declared to be excluded from its federal sanctions regime relating to Sudan
or Iran or any federal sanctions regime relating to a foreign terrorist organization.
b. No Boycott of Israel. The Developer hereby verifies that it and its parent
company, wholly- or majority-owned subsidiaries, and other affiliates, if any, do not
boycott Israel and will not boycott Israel during the term of this Agreement. As used in
the foregoing verification, “boycott Israel” has the meaning provided in Section 2271.001,
Government Code.
c. No Discrimination Against Firearm Entities. The Developer hereby verifies
that it and its parent company, wholly- or majority-owned subsidiaries, and other affiliates,
if any, do not have a practice, policy, guidance, or directive that discriminates against a
firearm entity or firearm trade association and will not discriminate against a firearm entity
or firearm trade association during the term of this Agreement. As used in the foregoing
verification, “discriminate against a firearm entity or firearm trade association” has the
meaning provided in Section 2274.001(3), Government Code.
d. No Boycott of Energy Companies. The Developer hereby verifies that it
and its parent company, wholly- or majority-owned subsidiaries, and other affiliates, if any,
do not boycott energy companies and will not boycott energy companies during the term
of this Agreement. As used in the foregoing verification, “boycott energy companies” has
the meaning provided in Section 2276.001(1), Government Code.
Execution pages to follow]
S-1
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of
November 17, 2025.
CITY OF ANNA, TEXAS
By: ______________________________
Pete Cain
Mayor
ATTEST:
Carrie L. Land
City Secretary
City Seal)
S-2
DEVELOPER:
BLOOMFIELD HOMES, L.P.,
a Texas limited partnership
By: Bloomfield Properties, Inc.,
a Texas corporation, its General Partner
By:_______________________________
Donald J. Dykstra, President
A-1
Exhibit A
FORM OF CLOSING DISBURSEMENT REQUEST
The undersigned is an agent for Bloomfield Homes, L.P. (the “Developer”) and requests
payment from:
the Costs of Issuance Account of the Project Fund][the Improvement Area #1 Bond
Improvement Account of the Project Fund] (as defined in the Crystal Park Public Improvement
District No. 2 Improvement Area #1 Construction, Funding, and Acquisition Agreement) from
Regions Bank (the “Trustee”) in the amount of _________________ DOLLARS ($__________)
for costs incurred in the establishment, administration, and operation of the Crystal Park Public
Improvement District No. 2 (the “District”), as follows:
Closing Costs Description Cost PID Allocated Cost
TOTAL
In connection to the above referenced payments, the Developer represents and warrants to
the City as follows:
1. The undersigned is a duly authorized officer of the Developer, is qualified to
execute this Closing Disbursement Request on behalf of the Developer, and is
knowledgeable as to the matters set forth herein.
2. The payment requested for the above referenced establishment, administration, and
operation of the District at the time of the delivery of the Bonds has not been the subject
of any prior payment request submitted to the City.
3. The amount listed for the above itemized costs is a true and accurate representation
of the Actual Costs incurred by Developer with the establishment of the District at the time
of the delivery of the Bonds, and such costs are in compliance with the Service and
Assessment Plan.
4. The Developer is in compliance with the terms and provisions of the Crystal Park
Public Improvement District No. 2 Improvement Area #1 Construction, Funding, and
Acquisition Agreement, the Development Agreement, and the Service and Assessment
Plan.
5. All conditions set forth in the Indenture (as defined in the Crystal Park Public
Improvement District No. 2 Improvement Area #1 Construction, Funding, and Acquisition
Agreement) for the payment hereby requested have been satisfied.
A-2
6. The Developer agrees to cooperate with the City in conducting its review of the
requested payment, and agrees to provide additional information and documentation as is
reasonably necessary for the City to complete said review.
Payments requested hereunder shall be made as directed below:
a. X amount to Person or Account Y for Z goods or services.
b. Etc.
I hereby declare that the above representations and warranties are true and correct.
BLOOMFIELD HOMES, L.P.
By: _____________________________
Name: __________________________
Title: ___________________________
Date: ___________________________
A-3
APPROVAL OF REQUEST BY CITY
The City is in receipt of the attached Closing Disbursement Request. After reviewing the Closing
Disbursement Request, the City approves the Closing Disbursement Request and shall include said
payments in the City Certificate submitted to the Trustee directing payments to be made from the
Costs of Issuance Account of the Project Fund or the Improvement Area #1 Bond Improvement
Account of the Project Fund, as applicable, upon delivery of the Bonds. The City’s approval of
the Closing Disbursement Request shall not have the effect of estopping or preventing the City
from asserting claims under the Crystal Park Public Improvement District No. 2 Improvement
Area #1 Construction, Funding and Acquisition Agreement, the Development Agreement, the
Service and Assessment Plan, any other agreement between the parties or that there is a defect in
an Improvement Area #1 Project.
CITY OF ANNA, TEXAS
By: ____________________
Name: ____________________
Title: ____________________
Date: ____________________
B-1
Exhibit B
CERTIFICATION FOR PAYMENT FORM – IMPROVEMENT AREA #1 PROJECTS
CERTIFICATION FOR PAYMENT NO. ______
The undersigned is a lawfully authorized representative for Bloomfield Homes, L.P. (the
Developer”) and requests payment from the Improvement Area #1 Bond Improvement Account
of the Project Fund from Regions Bank (the “Trustee”) in the amount of __________________
for labor, materials, fees, and/or other general costs related to the construction and installation of
the following Improvement Area #1 Projects related to the Crystal Park Public Improvement
District No. 2:
insert specific Improvement Area #1 Project this request is for here]
Unless otherwise defined, any capitalized terms used herein shall have the meanings ascribed to
them in the Crystal Park Public Improvement District No. 2 Improvement Area #1 Construction,
Funding, and Acquisition Agreement.
In connection with this Certification for Payment, the Developer represents and warrants to the
City as follows:
1. The undersigned is a duly authorized officer of the Developer, is qualified to
execute this Certification for Payment on behalf of the Developer, and is knowledgeable
as to the matters set forth herein.
2. The payment requested herein for the Improvement Area #1 Project(s) has not been
the subject of any prior payment request submitted for the same work to the City or, if
previously requested, no disbursement was made with respect thereto.
3. The itemized amounts listed for the Improvement Area #1 Project(s) below are a
true and accurate representation of the Actual Costs incurred by Developer with the
construction and installation of said Improvement Area #1 Project(s) identified above, and
such costs are (i) in compliance with the Crystal Park Public Improvement District No. 2
Improvement Area #1 Construction, Funding, and Acquisition Agreement, and (ii)
consistent with the Service and Assessment Plan.
4. The Developer is in compliance with the terms and provisions of the Crystal Park
Public Improvement District No. 2 Improvement Area #1 Construction, Funding, and
Acquisition Agreement, the Development Agreement, and the Service and Assessment
Plan.
5. All conditions set forth in the Indenture for the payment hereby requested have been
satisfied.
B-2
6. The work with respect to the Improvement Area #1 Project(s) identified above (or
its completed segment, portion or segment) has been completed and the City has inspected
or may begin inspection of the Improvement Area #1 Project(s). If this request for payment
results in ninety percent (90%) or more of the Budgeted Costs for the Improvement Area
1 Project(s) identified above being paid, then the work with respect to the Improvement
Area #1 Project(s) have been completed and the City has inspected AND accepted the
Improvement Area #1 Project(s).
7. The Developer agrees to cooperate with the City in conducting its review of the
requested payment, and agrees to provide additional information and documentation as is
reasonably necessary for the City to complete said review.
Payments requested are as follows:
Payee / Description
of Improvement
Area #1 Project
Total Cost of
Improvement Area
1 Project
Budgeted Cost of
Improvement Area
1 Project
Amount to be paid from
Improvement Area #1 Bond
Improvement Account of
the Project Fund
Attached hereto, are receipts, purchase orders, change orders, and similar instruments which
support and validate the above requested payments or Actual Costs incurred.
Pursuant to the Crystal Park Public Improvement District No. 2 Improvement Area #1
Construction, Funding, and Acquisition Agreement, after receiving this Payment Request, the City
is authorized to inspect the Improvement Area #1 Project (or completed segment, portion or
segment) and confirm that said work has been completed in accordance with all applicable
governmental laws, rules, and Plans.
I hereby declare that the above representations and warranties are true and correct.
BLOOMFIELD HOMES, L.P.
By:_____________________________
Name: __________________________
Title: ___________________________
Date: ___________________________
B-3
APPROVAL OF REQUEST BY CITY
The City is in receipt of the attached Certification for Payment. After reviewing the Certification
for Payment, the City approves the Certification for Payment and shall include said payments in
the City Certificate submitted to the Trustee directing payments to be made from the appropriate
Project Fund account. The City’s approval of the Certification for Payment shall not have the
effect of estopping or preventing the City from asserting claims under the Crystal Park Public
Improvement District No. 2 Improvement Area #1 Construction, Funding, and Acquisition
Agreement, the Development Agreement, the Service and Assessment Plan, any other agreement
between the parties or that there is a defect in the Improvement Area #1 Projects.
CITY OF ANNA, TEXAS
By: ____________________
Name: ____________________
Title: ____________________
Date: ____________________
THIS PAGE IS LEFT BLANK INTENTIONALLY.
APPENDIX G
APPRAISAL
PROJECT # A22-0803-01
CRYSTAL PARK PUBLIC IMPROVEMENT DISTRICT NO. 2 IMPROVEMENT AREA #1
47.859 ACRES CONTAINING 171 PROSPECTIVE RESIDENTIAL LOTS
ANNA, TX 75409
FOR:
FMSBONDS, INC.
5 COWBOYS WAY, SUITE 300-25
FRISCO, TEXAS 75034
EFFECTIVE DATE OF APPRAISAL:
JULY 1, 2026 (DATE OF SUBSTANTIAL COMPLETION) FOR 171 RESIDENTIAL LOTS
PREPARED BY:
JAMES L. MAIBACH, CPM, STATE CERTIFIED GENERAL REAL ESTATE APPRAISER,
LESLIE TOLLIVER, STATE CERTIFIED GENERAL REAL ESTATE APPRAISER,
BROOKE CLOCK, LICENSED RESIDENTIAL APPRAISER, AND
BRANDON LAWSON, APPRAISER TRAINEE
OF:
PEYCO SOUTHWEST REALTY, INC.
1703 NORTH PEYCO DRIVE
ARLINGTON, TEXAS 76001
APPRAISAL REPORT
PROJECT # A25-0902-01
Crystal Park Public Improvement District No. 2 Improvement Area #1
2
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
October 8, 2025
Mr. R.R “Tripp” Davenport, III
Director
FMSbonds, Inc.
5 Cowboys Way, Suite 300-25
Frisco, Texas 75034
tdavenport@fmsbonds.com
SUBJECT: Prospective Market Value “Upon Completion” Appraisal
Crystal Park Public Improvement District No. 2 Improvement Area #1,
Anna, Collin County, Texas
Mr. Davenport,
At your request, we have inspected and appraised the above-referenced property. The purpose of the appraisal is
to develop an opinion of prospective market value of the Fee Simple interest of the 171 residential lots located
in the City of Anna within the Crystal Park Public Improvement District No. 2 Improvement Area #1 (referred
to as Crystal Park PID No. 2 IA #1). Crystal Park PID No. 2 IA #1 has a total of 47.859-acres consisting of the
following:
Prospective Market Value “Upon Completion” as of July 1, 2026 for 171 detached residential lots on
approximately 47.859 acres. The lots are as follows:
o 123 lots with 50-foot frontages (FF), and
o 48 lots with 60-FF
The client for the assignment is FMSbonds, Inc., The intended users are FMSbonds, Inc. and the City of Anna.
The intended use is underwriting of a proposed Public Improvement District bond transaction. This appraisal is
not for purposes of determining the amount of any assessments to be levied by the City of Anna or Collin County,
nor is it the basis of a determination of the benefit of any constructed or installed public improvements will have
on properties within Crystal Park PID No. 2 IA #1.
A public improvement district containing the property Crystal Park PID No. 2 IA #1 was created by a Resolution
2025-02-1744 (the “PID”) and Zoned Planned Development (Ordinance 969-2022), which is intended to allow
for single-family residences according to the approved concept plan. The entire PID consists of 274.396-acres
and will be developed over 5 total phases with a total of 946 lots within the Anna Independent School District.
Improvement Area #1 is platted for single-family residential only.
Crystal Park PID No. 2 IA #1, the subject of this appraisal, is comprised of approximately 47.859 contiguous
acres of land with an estimated build-out of 123 50-foot frontage lots and 48 60-foot frontage lots totaling 171
improved residential lots, located in the City of Anna, Collin County, Texas. The subject property of this
assignment - Crystal Park PID No. 2 IA #1 - will be developed in one phase.
Each of the 50-FF lot types will have a minimum of 5,500-SF and each 60-FF lot types will have a minimum of
7,000-SF. The average lot depths for both the 50-FF and 60-FF of the subject property will be 110’ in depth. We
have considered any difference in market value based on lot depth is marginal, and other attributes, such as overall
situs of the PID, are more important to the market value consideration of a single lot.
Crystal Park Public Improvement District No. 2 Improvement Area #1
3
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
The focus of our appraisal of the Crystal Park PID No. 2 IA #1 are as follows:
Area Type Size (Acres)
50' Lot
Type
60' Lot
Type
Total Lots
Appraised
Residential Lots 47.859-AC 123 48 171
Crystal Park PID No. 2 IA #1
Extraordinary Assumptions and Hypothetical Conditions
The value conclusions are subject to the following Extraordinary Assumptions that may affect the assignment
results. An Extraordinary Assumption is uncertain information accepted as fact. If the assumption is found to be
false as of the Effective Date of the appraisal, we reserve the right to modify our value conclusions. Extraordinary
Assumptions are used in this assignment because the improved residential lots to be delivered by the date utilized
in this report are currently incomplete as of the report date.
Our opinions of prospective market value at completion assumes that the proposed improvements are
completed in accordance with plans and specifications provided by LJA Engineering Inc., the
Professional Engineers, dated August 1, 2023 for 171 improved residential lots in Crystal Park PID No.
2 IA #1.
All information relative to the property located within Crystal Park PID No. 2 IA #1 including land areas,
lot totals, lot sizes, and other pertinent data that was provided by Bloomfield Homes, LP (the
Developer”), LJA Engineering Inc. (Professional Engineers and Surveyors), the City of Anna, Collin
County, and the Collin Central Appraisal District (CCAD) is assumed to be correct.
The subject is proposed residential lots construction with an expected prospective completion date of
July 1, 2026; therefore, this report contains a prospective opinion of value. Considering this, we have
assumed that the market conditions discussed and considered within this report will be similar on the
prospective valuation date. Further, we cannot be held responsible for unforeseeable global events that
alter market conditions prior to the prospective Effective Date.
The use of these extraordinary assumptions has affected assignment results.
In addition to the Extraordinary Assumptions, the value conclusions are based on the following Hypothetical
Conditions that may affect the assignment results. A Hypothetical Condition is a condition contrary to known
fact on the Effective Date of the appraisal but is supposed for the purpose of analysis.
No Hypothetical Conditions are used in this report.
Crystal Park Public Improvement District No. 2 Improvement Area #1
4
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
This appraisal report is intended to conform with the 2024-2025 Uniform Standards of Professional Appraisal
Practice (USPAP) and applicable state appraisal regulations. To report the assignment results, we use the
Appraisal Report option of Standards Rule 2-2(a) of USPAP. Based upon the valuation analysis in the
accompanying report, and subject to the definitions, assumptions, and limiting conditions expressed in the report,
our final value conclusion as of the Expected Substantial Completion Date are as follows:
Total
Lots
Feet Frontage
FF)
Retail
Price/Lot Effective Date
Price/FF
FF)
Total Retail
Value ($)
123 50 FF $106,750 July 1, 2026 $2135/FF $13,130,250
48 60 FF $126,000 July 1, 2026 $2100/FF $6,048,000
171 $19,178,250
CRYSTAL PARK PID No. 2 IA #1
After considering discount cash flows, our final value conclusion “Upon Completion” is shown below:
Crystal Park PID No. 2 IA #1
171 Improved Residential Lots
INCOME APPROACH VALUE INDICATION
Fee Simple Interest, Complete July 1, 2026
16,574,000 ($97,000/Lot)
Rounded
Attached is our Appraisal Report which summarizes the investigation and analyses undertaken in arriving at our
value conclusions. Should you have any questions, please contact our office.
Respectfully submitted,
Peyco Southwest Realty
James L. Maibach, C.P.M
TX-1323658
State Certified General Real Estate Appraiser
Leslie Tolliver
TX-1381494
State Certified General Real Estate Appraiser
Associate Member, Appraisal Institute
Brooke Clock
TX-1350743
State Licensed Residential Appraiser
Brandon Lawson
TX-1343865
Appraiser Trainee
Associate Member, Appraisal Institute
Crystal Park Public Improvement District No. 2 Improvement Area #1
5
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Contents
EXECUTIVE SUMMARY..............................................................................................................................................................................................6
CERTIFICATION ............................................................................................................................................................................................................7
SCOPE OF WORK..........................................................................................................................................................................................................8
VALUATION METHODOLOGY................................................................................................................................................................................10
REAL ESTATE TAXES................................................................................................................................................................................................14
MARKET OVERVIEW................................................................................................................................................................................................15
REGIONAL ANALYSIS...............................................................................................................................................................................................36
NEIGHBORHOOD ANALYSIS...................................................................................................................................................................................40
ABSORPTION ANALYSIS ..........................................................................................................................................................................................48
SUBJECT PROPERTY ANALYSIS............................................................................................................................................................................54
PROPERTY PHOTOGRAPHS....................................................................................................................................................................................80
HIGHEST AND BEST USE..........................................................................................................................................................................................82
VALUATION – IMPROVED RESIDENTIAL LOTS................................................................................................................................................84
INCOME (SUBDIVISION DEVELOPMENT) APPROACH - IMPROVED RESIDENTIAL LOTS.................................................................... 85
VALUE CONCLUSION FOR 50’ LOTS .........................................................................................................................................95
VALUE CONCLUSION FOR 60’ LOTS .......................................................................................................................................105
RECONCILIATION AND FINAL VALUE CONCLUSION................................................................................................................................... 115
ADDENDA ...................................................................................................................................................................................................................117
ENGAGEMENT LETTER..............................................................................................................................................................118
LEGAL DESCRIPTION..................................................................................................................................................................125
ASSUMPTIONS AND LIMITING CONDITIONS.......................................................................................................................132
EXTRAORDINARY ASSUMPTIONS AND HYPOTHETICAL CONDITIONS......................................................................135
ENVIRONMENTAL ASSUMPTIONS ..........................................................................................................................................136
DEFINITIONS..................................................................................................................................................................................137
JAMES L. MAIBACH, CPM - STATE CERTIFIED GENERAL REAL ESTATE APPRAISER...........................................140
LESLIE TOLLIVER - STATE CERTIFIED GENERAL REAL ESTATE APPRAISER........................................................142
BROOKE CLOCK – LICENSED RESIDENTIAL APPRAISER ...............................................................................................144
BRANDON LAWSON – APPRAISER TRAINEE........................................................................................................................146
Crystal Park Public Improvement District No. 2 Improvement Area #1
6
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
EXECUTIVE SUMMARY
Property Name Crystal Park Public Improvement District No. 2 Improvement Area #1
Property Type Master-Planned Community
Location West of U.S. Highway 75 and south of Farm-to-Market 455
City, County, State, Zip City of Anna, Collin County, TX 75409
Legal Description (Collin CAD) ABS A0197 John Coffman Survey, Tract 9, 85.3867 Acres
Owner of Record Bloomfield Homes, LP
Census Tract 0302.02
Tax ID – Collin CAD 1002239
Total Land Area 47.859-AC - Total Land Area
Total Lots 171 Single-Family Improved Lots
123 50-FF Width Lots
48 60-FF Width Lots
Topography Gently Sloping
FEMA Flood Zones Unshaded Zone X
FEMA Panel 48085C0155J
FEMA Map Date 6/2/2009
Utilities
Water City of Anna
Sewer City of Anna
Electric Oncor
Natural Gas Atmos
Zoning (City of Anna) Planned Development
Future Land Use Single-Family Residential Subdivision
Highest & Best Use Single-Family Residential Subdivision
16,574,000 ($97,000/Lot) Effective Date of July 1, 2026, for 171 Improved
Residential Lots on 47.859 Acres
Exposure Period 6-12 Months
Marketing Period 6-12 Months
Date of Inspection September 15, 2025
Date of Valuation July 1, 2026
Report Date October 8, 2025
Final Value Conclusion
Total Lots Breakdown
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CERTIFICATION
We certify that, to the best of our knowledge and belief that:
1) The statements of fact contained in this report are true and correct.
2) The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting
conditions, and are our personal, impartial, and unbiased professional analyses, opinions, and conclusions.
3) We have no present or prospective interest in the property that is the subject of this analysis, and we have
no personal interest with respect to the parties involved.
4) We have no bias with respect to the property that is the subject of this report or to the parties involved
with this assignment.
5) Our compensation for completing this assignment is not contingent on an action or event resulting from
the analyses, opinions, or conclusions in, or use of, this report, or upon developing or reporting of a
predetermined value or direction in value that favors the cause of the client, the amount of the value
opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to
the intended use of this appraisal. Our engagement in this assignment is not contingent upon developing
or reporting predetermined results.
6) The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in
conformity with the requirements of FIRREA guidelines and the Code of Professional Ethics & Standards
of Professional Practice of the Appraisal Institute, which includes the Uniform Standards of Professional
Appraisal Practice.
7) Leslie Tolliver has physically viewed the subject property. Jim Maibach, Brooke Clock, and Brandon
Lawson have not viewed the subject property.
8)This assignment was not based on a requested minimum value, a specific valuation, or the approval of a loan.
9) None of the signatories have previously performed services as an appraiser or in any other capacity, other
than that specifically stated, regarding the property that is the subject of this report within the three-year
period immediately preceding the acceptance of this assignment.
10) James L. Maibach and Brooke Clock are not members of the Appraisal Institute. Leslie Tolliver and
Brandon Lawson are Associate Members of the Appraisal Institute. As of the date of this report, Leslie
Tolliver and Brandon Lawson have completed the Standards and Ethics Education Requirements for
Associate Members of the Appraisal Institute. The use of this report is subject to the requirements of the
Appraisal Institute relating to review by its duly authorized representatives.
James L. Maibach, C.P.M
TX-1323658
State Certified General Real Estate Appraiser
Leslie Tolliver
TX-1381494
State Certified General Real Estate Appraiser
Associate Member, Appraisal Institute
Brooke Clock
TX-1350743
State Licensed Residential Appraiser
Brandon Lawson
TX-1343865
Appraiser Trainee
Associate Member, Appraisal Institute
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SCOPE OF WORK
Scope of Work is defined by the Uniform Standards of Professional Appraisal Practice as “the type and extent of
research and analyses in an assignment.” Under the Scope of Work Rule, the appraiser must:
Identify the problem to be solved;
Determine and perform the scope of work necessary to develop credible assignment results; and
Disclose the scope of work in the report.
The problem to be solved is:
o Determine the Prospective Market Value with a Substantial Completion Date of July 1, 2026 for the Fee
Simple interest of 171 improved single-family residential lots in Crystal Park PID No. 2 IA #1 as such.
o 123 lots with 50-FF
o 48 lots with 60-FF
The definition of market value 1 utilized herein is as follows:
Market Value is defined as the most probable price, as of a specified date, in cash, or in terms equivalent to cash,
or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure
in a competitive market under all conditions requisite for a fair sale, with the buyer and seller each acting
prudently, knowledgeably, and for self-interest, and assuming that neither is under undue duress. Implicit in this
definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under
conditions whereby:
1. buyer and seller are typically motivated;
2. both parties are well informed or well advised, and acting in what they consider their own best interests;
3. a reasonable time is allowed for exposure in the open market;
4. payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable
thereto; and
5. the price represents the normal consideration for the property sold unaffected by special or creative
financing or sales concessions granted by anyone associated with the sale.2
The reported analyses, opinions and conclusions were developed, and this report has been prepared, in conformity
with the requirements of FIRREA guidelines and the Code of Professional Ethics & Standards of Professional
Practice of the Appraisal Institute, which include the Uniform Standards of Professional Appraisal Practice, in a
manner necessary to produce a credible result.
This Appraisal Report has been prepared under Standards Rule 2-2(a) of an appraisal performed under Standards
Rule 1 of USPAP. The value set forth herein was determined after consideration and appropriate application and
analysis by three approaches to value i.e., the Cost Approach, the Income (Subdivision Development) Approach,
and the Sales Comparison Approach.
1 The Appraisal Foundation, Uniform Standards of Professional Appraisal Practice, Washington, D.C.: Appraisal Standards Board
2020-2021), DEFINITIONS
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
As part of this appraisal, we completed a thorough investigation and analysis of the data considered pertinent to
valuing the subject property.
Property Identification
The property has been identified using the following sources:
Public records – Collin Central Appraisal District (CCAD)
Legal description
Deed Records – Collin County
Crystal Park PID No. 2 IA #1 Concept Plan Exhibit and Survey by LJA Engineering Inc., Professional
Engineer
Type and Extent of Data Researched
The following information was reviewed in preparing this report:
Public record data
City of Anna Maps and Land Use Plans
Flood plain maps
Topographic maps
Demographics – CoStar, ESRI, and US Census Bureau
Market Conditions Data – S&P Case Schiller, CoreLogic, Zonda, NTREIS, JLL, CBRE, Integra, CoStar,
etc.
Crystal Park PID No. 2 IA #1 Concept Plan Exhibit and Survey by LJA Engineering Inc., Professional
Engineer
Estimated development costs provided by LJA Engineering Inc., Professional Engineer
Conversations with developers and homebuilders in DFW market
Information provided by the client
PID Creation Resolution (Resolution 2025-02-1744) recorded on February 25, 2025
Crystal Park Development Agreement effective January 11, 2022, as amended
Ordinance 969-2022 by the City of Anna
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
VALUATION METHODOLOGY
Three approaches to value are typically considered when developing a market value opinion for real property.
These are the Cost Approach, the Sales Comparison Approach, and the Income (Subdivision Development)
Approach. A summary of each portion of the subject property that requires valuation is shown below:
171 Improved Single-Family Residential Lots (50-FF and 60-FF).
Improved Detached Single-Family Residential Lots (171 Improved Residential Lots)
Cost Approach
The Cost Approach involves research, verification, and comparison of sales of other vacant land with the subject
engineer, then compared to cost figures on competing developments. A developer’s profit is based on profit
expectations reported by developers as well as actual profit on similar developments.
The Cost Approach provides information that contrasts with information from the Income Capitalization and
Sales Comparison Approaches. It allows the appraiser to address the feasibility and highest and best use issues
inherent in new construction. This approach is most beneficial when appraising a proposed or recently built
project and is typically used when finished lots make up a substantial portion of the entire project. Crystal Park
PID is being developed in multiple phases, the Cost Approach is not the most appropriate and thus was not
utilized for the 171 Improved Residential Lots.
Income (Subdivision Development) Approach
In the Income Capitalization Approach, the retail value of the residential lots is estimated. The individual lot
values are based on lot sales in competing developments. The absorption rates, expenses, and discount rates are
also based on competing developments. Since sales of individual lots to an end-user homeowner is exceedingly
rare in tract home subdivisions in this market, the value of an individual retail lot is effectively the same value of
a portion of lots to a homebuilder because homebuilders tend to be the exclusive buyers of vacant developed lots
from land developers. In addition, discussions with developers and homebuilders as well as review of contracts
indicate that lots are typically received by the builders on a takedown schedule with annual price escalations of
approximately 6% so the lots are not released in bulk to the home builders. The indicated value by the Income
Subdivision) Approach is based on the sellout of the lots with deductions for holding costs and discounted to a
net present value.
The Income (Subdivision Development) Approach applied in subdivision analysis simulates what occurs in a
bulk sale where one buyer purchases a subdivision or large group of lots at a discount. Income capitalization is
the primary method used in subdivision valuation because value is determined by future sales over time. Along
with discounted cash flow analysis, income capitalization directly measures differences in present value based
on future cash flow projections. This approach provides a direct measure of the market value or wholesale value
of a group of lots or units, which is different from the sum of the retail lot prices. Since the problem to be solved
in this assignment is to determine the bulk sale value of 171 improved residential lots, as of the date of Substantial
Completion (Effective Date), the Income (Subdivision Development) Approach is appropriate and was
developed.
Sales Comparison Approach
The Sales Comparison Approach involves comparing recent sales of entire subdivisions or a large group of lots
values for the subdivision or the group of lots is the objective of the analysis, and that determination requires
recent and relevant similar bulk sales for the comparison. Finding highly similar and recent sales of improved
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
subdivisions to a single buyer in most markets can be difficult, perhaps impossible. Comparison requires
comparable sales with about the same or similar remaining absorption period, a similar mix of lots or unit types,
location, home price points, and other characteristics. As Texas is a non-disclosure state, the sales data available
is limited to sales confirmed by associated parties. Since data on highly similar bulk sales to a single purchaser is
difficult to find and verify, the Sales Comparison Approach was not fully developed by the appraisers. Use of the
approaches for the valuation of the improved lots in Crystal Park PID No. 2 IA #1 is summarized as follows:
Approach Applicability to Subject Use in Assignment
Cost Approach Not Appropriate Since the Whole Property is
Developed in Multiple Phases
Not Utilized
Income (Subdivision
Development) Approach
Appropriate in Determining Residential
Subdivision Value
Utilized
Sales Comparison Approach Aspects Used in Subdivision Valuation to
Determine Retail Market Value of the 50-FF Lots
and the 60-FF Lots
Partially Utilized
COMPETENCY OF THE APPRAISER
James L. Maibach, C.P.M. is a State Certified General Real Estate Appraiser according to the Texas Appraiser
Licensing and Certification Board and has appraised numerous properties similar to the subject since 1993. The
appraiser also manages, through his commercial real estate management company, approximately 2.25 million
SF of which 60% is industrial warehouse, 20% is Class B and C office and 20% in retail product in Tarrant,
Dallas, and Johnson counties. Mr. Maibach has been personally involved in over 65 residential development
projects as a broker, developer, bank director, and zoning consultant in the past 35 years. Leslie Tolliver is a State
Certified General Real Estate Appraiser who has assisted in the analysis and appraisal of numerous properties
similar to the subject. Brooke Clock is a Licensed Residential Appraiser and Brandon Lawson is an Appraiser
Trainee and has assisted in numerous properties similar to the subject property. Attention is paid to the
qualifications of each individual which are presented in the Addenda of this report.
Peyco Southwest Realty is a full-service professional real estate appraisal and consulting firm, providing service
to a variety of corporate, institutional, governmental, and private clientele. In the past 12 months, our firm has
completed numerous valuation assignments involving similar properties. Mr. Maibach currently owns, represents,
and manages multiple properties throughout the DFW Metroplex, mostly in Tarrant, Dallas, Johnson, and Ellis
Counties. The subject is located in the City of Anna, Collin County, Texas.
INTENDED USE AND USERS
The intended use of the appraisal is to estimate the market value upon completion of the underwriting of a proposed
Public Improvement District bond transaction as of the Effective Date of Substantial Completion. The client and
intended user is FMSbonds, Inc. The City of Anna is also an intended user. The appraisal is not intended for any
other use or user. No party or parties other than the City of Anna and FMSbonds, Inc. may use or rely on the
information, opinions, and conclusions contained in this report; provided, however, it is acknowledged that this
Appraisal will be used in a preliminary and final limited offering memorandum for the Public Improvement District
bonds. The Client may, without Appraiser’s prior authorization or notice to Appraiser, provide the Appraisal to
other parties for their use in analysis-related activities, however, it does not make the recipient an intended user of
this engagement.
DATE OF THE APPRAISAL REPORT
The preparation of this Appraisal Report was completed on October 8, 2025. The initial draft of this appraisal
report was completed on September 17, 2025.
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
EFFECTIVE DATES OF THE APPRAISAL
The descriptions, analyses, and conclusions of this report for the designated Market Values of the subject property
are applicable as of July 1, 2026, which is the expected date of Substantial Completion. Leslie Tolliver inspected
the subject property on September 15, 2025. Jim Maibach, Brooke Clock, and Brandon Lawson have not
inspected the subject property.
ASSIGNMENT CONDITIONS
Assignment conditions include assumptions that affect the scope of work, other than those previously discussed
in the “Assumptions and Limiting Conditions.” There are no other material and specific hypothetical conditions
or extraordinary assumptions other than those referenced in this report.
PROPERTY RIGHTS APPRAISED
The property rights appraised in this assignment are the Fee Simple Estate in the subject property. A commitment
for Title Insurance was not submitted to the appraisers and reservations, if any, are unknown. If property rights
differ from the above definitions, the value may be affected.
ASSETS APPRAISED
The assets appraised in this appraisal assignment include land, any primary and ancillary site improvements. No
furniture, fixtures, equipment (FF&E), personal property, mineral rights, or business value were included in the
valuation process.
ENVIRONMENTAL CONDITIONS
No environmental report was available to us, and no recent environmental tests were performed. Because we have
no evidence to the contrary, we have assumed that the property is free of any material defects, other than those
noted, which would adversely affect the value, including, but not limited to, asbestos and toxic waste. Our value
conclusions are subject to revision should these assumptions prove incorrect. We caution and advise the user of
this report to obtain environmental studies which may be required to ascertain the status of the property regarding
asbestos and other hazardous materials.
HISTORY OF SUBJECT PROPERTY
Collin Central Appraisal District (CCAD) records indicate the ownership of the subject property is owned by
Bloomfield Homes, LP. The land transferred in two transactions on December 16, 2021, The first was between
Fredrick Alexander Miller, Virgil Wren Miller, Jeffery Wayne Rollins, Rebecca Lorraine Rollins, and Marquin
Jan Kunkle with document #20211222002575780 to Bloomfield Homes, LP for 116.974 acres purchased for
5,264,037 ($45,000/AC). The second transaction was between Vrigil Wren Miller and Marquin Jan Kunkle with
document #20211220002551800 to Bloomfield Homes, LP. for 243.477 acres purchased for $10,956,490
45,000/AC). These sales appear to be an arms-length transaction, and the sales prices were within market rates
at the time of sale.
We are unaware of any other attempts to sell or divest the subject property, as of the report date. This historical
ownership data was researched and reported in order to comply with USPAP which requires a 3-year history of
the subject property. It should not be used in lieu of a title search and is not intended as a guarantee to the chain
of title.
LEGAL DESCRIPTION
ABS A0197 John Coffman Survey, Tract 9, 85.3867 Acres
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
PENDING TRANSACTIONS TO BUILDERS
The land within the development is owned by Bloomfield Homes, LP who will also be the developer for the
subject property. There are no sales contracts for the improved lots as Bloomfield Homes, LP will be the ultimate
seller to the end user when the lots are fully developed with single-family residential developments.
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Real Estate Taxes
Collin Central Appraisal District
Real estate tax assessments are administered by the Collin Central Appraisal District (CCAD) and are estimated
by jurisdiction on a county basis for the subject. Real estate taxes in this state and this jurisdiction represent ad
valorem taxes, meaning a tax applied in proportion to value. The real estate taxes for an individual property may
be determined by dividing the assessed value for a property by $100, then multiplying the estimate by the
composite rate.
Real estate taxes and assessments for the 2025 tax year are shown in the following table which include taxes to
the City of Anna, Collin County, Collin College, and Anna ISD. The projected combined tax rate for those entities
is 1.995536 per $100 assessed as shown in the table below:
Entity Rate
City of Anna 0.525073
Collin County 0.149343
Collin College 0.081220
Anna ISD 1.239900
Total 1.995536
Property Taxes - 2025
Crystal Park PID No. 2 IA #1 is within one tax parcel. The 2025 tax burden for the subject property – which is
currently in the process of being developed is $277.28. A table of the assessed value and property taxes for the
year (2025) of the subject property is shown below:
ID Owner Size (AC)
Improvement
Market Value
Land Market
Value
Ag
Exemption
Assessed
Value
Estimated
Taxes
1002239 Bloomfield Homes, LP 85.387 -$ 4,867,042$ $ 4,853,147 13,895$ 277.28$
85.387 $0.00 $4,867,042 4,853,147$ $13,895 $277.28
TAXES (Collin CAD - 2025)
Total Combined:
The land area represented by Collin Central Appraisal District are not necessarily accurate. The land market that
Collin Central Appraisal District (CCAD) has determined - $4,867,042 ($57,000/AC, $1.31/SF) –leads to a tax
burden of $97,123.58. When the property is redeveloped into residential use, there may be rollback taxes due to
the municipal entities. We have not considered the effect of rollback taxes herein and that is beyond the scope of
work of this report.
Upon substantial completion of the improved lots, the appraised value is expected to increase significantly;
however, based on our company’s experience as licensed property tax consultants working with tax districts and
homebuilders, we believe the finished lots will be assessed by the appraisal district at below retail lot value.
Finished lots are often assessed by tax districts at approximately 70% of the retail value because the tax district
does not have reliable information on updated costs and because developers are eligible for an inventory reduction
on their lots..
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
MARKET OVERVIEW
ECONOMIC INDICATORS: BEIGE BOOK
FEDERAL RESERVE BANK (SEPTEMBER 3, 2025)
Due to the subject’s location in North Texas, coupled with integrated business economies,
it is relevant to consider the national and regional economic indicators presented by the
Federal Reserve Bank of Dallas in the Beige Book. Excerpts from the most recent Beige
Book are presented below:
Overall Economic Activity
Most of the twelve Federal Reserve Districts reported little or no change in economic
activity since the prior Beige Book period—the four Districts that differed reported modest
growth. Across Districts, contacts reported flat to declining consumer spending because,
for many households, wages were failing to keep up with rising prices. Contacts frequently cited economic
uncertainty and tariffs as negative factors. New York reported that “consumers were being squeezed by rising
costs of insurance, utilities, and other expenses.” Contacts observed the following responses to the consumer
pullback. Retail and hospitality sectors offered deals and promotions to help price sensitive consumers stretch
their dollars—supporting steady demand from domestic leisure tourists but not offsetting falling demand from
international visitors. The auto sector noted flat to slightly higher sales, while consumer demand increased for
parts and services to repair older vehicles. Manufacturing firms reported shifting to local supply chains where
feasible and often using automation to cut costs. The push to deploy AI partly explains the surge of data center
construction—a rare strength in commercial real estate noted by the Philadelphia, Cleveland, and Chicago
Districts. Atlanta and Kansas City reported that data centers had increased energy demand in their Districts.
Overall, sentiment was mixed among the Districts. Most firms either reported little to no change in optimism or
expressed differing expectations about the direction of change from their contacts.
Labor Markets
Eleven Districts described little or no net change in overall employment levels, while one District described a
modest decline. Seven Districts noted that firms were hesitant to hire workers because of weaker demand or
uncertainty. Moreover, contacts in two Districts reported an increase in layoffs, while contacts in multiple
Districts reported reducing headcounts through attrition—encouraged, at times, by return-to-office policies and
facilitated, at times, by greater automation, including new AI tools. In turn, most Districts mentioned an increase
in the number of people looking for jobs. However, half of the Districts noted that contacts reported a reduction
in the availability of immigrant labor, with New York, Richmond, St. Louis, and San Francisco highlighting its
impact on the construction industry. Half of the Districts described modest growth in wages, while most of the
others reported moderate growth. Two Districts noted little or no change in wages.
Prices
Ten Districts characterized price growth as moderate or modest. The other two Districts described strong input
price growth that outpaced moderate or modest selling price growth. Nearly all Districts noted tariff-related
price increases, with contacts from many Districts reporting that tariffs were especially impactful on the prices
of inputs. Contacts in multiple Districts also reported rising prices for insurance, utilities, and technology
services. While some firms reported passing through their entire cost increases to customers, some firms in nearly
all Districts described at least some hesitancy in raising prices, citing customer price sensitivity, lack of pricing
power, and fear of losing business. In some cases, as highlighted by Cleveland and Minneapolis, firms reported
being under pressure to lower prices because of competition, despite facing increased input costs. Most Districts
reported that their firms were expecting price increases to continue in the months ahead, with three of those
Districts noting that the pace of price increases was expected to rise further.
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
ELEVENTH DISTRICT
FEDERAL RESERVE BANK OF DALLAS –SEPTEMBER 3, 2025
Summary of Economic Activity
Economic activity in the Eleventh District expanded modestly. Growth picked up in nonfinancial services and
manufacturing. Retail sales increased, and loan volume rose, driven by increases in residential and commercial
real estate lending. Agricultural conditions were favorable. Meanwhile, housing market activity remained weak,
and drilling activity and oil production were flat. Employment levels were unchanged, and wage growth was
moderate. Prices increased modestly apart from the manufacturing sector, where price pressures intensified due
to tariffs. Outlooks improved but there was widespread trepidation regarding shifting trade policy, high interest
rates, and more restrictive immigration policy. Just over one-fifth of firms said they expect a decline in demand
for their goods or services over the next six months.
Labor Markets
Employment was fairly flat over the reporting period. A roughly equal share of service firms reported increasing
versus decreasing employment. Staffing firms reported slow hiring activity, with a couple of contacts noting that
companies were opting to reallocate workload internally or cutting staff in response to cost pressures from tariffs.
A restaurant chain cited plans to automate in some areas to reduce labor costs. Homebuilders, oilfield services
firms, and nonprofits noted trimming headcounts. Meanwhile, overall manufacturing employment grew
moderately, although some transportation equipment and petrochemical manufacturers reported reducing staff
to contain costs. Overall, wage growth was moderate, and firms noted improved availability of applicants.
Prices
Selling prices increased at a modest pace, except for the manufacturing sector where price pressures rose
reflecting the widespread impact of tariffs. According to an August Dallas Fed survey, nearly half of firms noted
being negatively impacted by tariffs, and all of them noted facing higher input costs as a result. Among those
passing through tariff cost increases to customers in the form of higher prices, roughly half noted doing so within
a month of the tariff taking effect, and three quarters are doing so within three months. Reports on the extent of
pass through were mixed, with only 21 percent noting full pass through thus far. Companies reported mitigating
tariff impacts by building up inventories prior to the tariff, absorbing higher costs, and finding alternative
suppliers.
Manufacturing
Activity in the manufacturing sector rebounded, following weakness in the prior reporting period. New orders
rose for the first time since January, led by increases in durable goods, namely transportation equipment,
machinery, and construction-related products. Output for nondurable goods expanded as well, with strength
noted in food and printing-related manufacturing. Gulf Coast refineries cited steady production levels and higher
margins for refined products. Perceptions of broader business conditions stabilized, and manufacturing outlooks
improved slightly, though there was continued widespread apprehension regarding tariffs, high interest rates,
and immigration policy.
Retail Sales
Retail sales rose during the reporting period. Auto sales remained steady, but one auto dealer noted a reduction
in demand for repair services. Building material and garden equipment retailers cited lower sales, while health
care and food and beverage stores reported increased activity. Overall retail inventories continued to decline,
and outlooks stabilized though uncertainty persisted, and various contacts cited concern about the impact of
tariffs on prices or demand.
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Nonfinancial Services
Activity in nonfinancial services grew modestly during the reporting period. Growth was driven in part by revenue
increases in health care and administrative and support services. Staffing firms saw a slight increase in demand
for their services, with one contact noting that clients were holding off on hiring due to uncertainty. Meanwhile,
transportation and warehousing services activity was flat. Airlines reported a modest pickup in demand in July,
though activity remained below last year’s levels. Service sector outlooks improved, but uncertainty remained a
headwind.
Construction and Real Estate
Housing market activity remained weak. Foot traffic and sales were choppy and lackluster, with one contact
characterizing the market as dismal. Existing and new home inventories rose further, and builders were
increasingly relying on marketing and incentives, including discounting and mortgage rate buydowns, to close
deals. Home starts have slowed, and lot supply is rising. Outlooks were pessimistic amid weak demand and
elevated economic uncertainty.
Commercial real estate activity increased slightly during the reporting period. Apartment demand remained solid
and occupancy rates edged higher, but the influx of new units kept rents flat to down. Office leasing ticked up,
and contacts said there appear to be more signs of stability. Industrial activity was characterized as solid. New
commercial construction activity was subdued. Investment sales activity continued to be limited, with scattered
reports of distressed property sales. Outlooks remained cautious.
Financial Services
Loan volume and demand rose in August. The increase was driven by a continued rise in commercial real estate
loan volumes and a sharp acceleration in residential real estate loans, which had contracted in the prior period.
Credit tightening continued, but loan pricing declined, both at a pace slightly faster than in June. Loan
performance deteriorated across all loan types. Bankers reported declining general business activity; however,
their outlook was mildly optimistic. Respondents expect growth in loan demand and business activity six months
from now, with a minor deterioration in loan performance.
Energy
Both drilling and well completion activity was little changed over the past six weeks. Headcounts dipped and oil
field service firms reported that significant idle equipment and workforce capacity was keeping margins razor
thin. Rising production from OPEC members combined with oil prices hovering near break-even levels has
dampened industry outlooks. If the price of West Texas Intermediate crude oil remained in the low 60-dollar
range, production was expected to be flat in the remainder of 2025 but likely erode in 2026. One bright spot was
the midstream sector, where contacts expect an acceleration in project starts in response to the One Big Beautiful
Bill Act and recent regulatory decisions.
Agriculture
Soil conditions were favorable across much of the District, boosting crop production. While yields are expected
to be above average, crop prices remained low and sub-profitable for many producers. Safety nets like crop
insurance and U.S. farm program payments will likely serve an important role this year. Cattle prices remained
historically high amid solid demand and a decline in beef production. One factor limiting production was the
suspension of cattle imports from Mexico implemented last fall to protect U.S. livestock from the New World
screwworm, a parasitic fly. Lower cattle supply is putting downward pressure on beef production and upward
pressure on prices.
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Community Perspectives
Nonprofits continue to see elevated demand for a broad range of social services, including food, childcare,
housing, transportation, and disaster assistance. Food assistance has emerged as one of the fastest growing needs
among clients but rising costs and loss of federal funding are making it harder for nonprofits to meet that need.
Subsidized childcare remains a critical barrier to employment for some families, with one organization noting
that there are more than 11,000 children on the waitlist for their service area. One contact said that with the cut
in FEMA funds they are having a hard time referring individuals to places for weather and disaster-related help.
The current environment remains challenging for nonprofits as they contend with the impact of federal spending
cuts amid high demand. Hence, even the most agile organizations are facing shifts in strategic priorities and staff
reductions.
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Texas A&M University
Texas Real Estate Research Center
Outlook for the Texas Economy (Excerpts)
Jorge Barro (Updated August 19, 2025)
Summary
A growing share of recent economic data shows the U.S. economy decelerating, though no strong evidence
indicates a looming recession. This extends a persistent macroeconomic slowdown following the post-pandemic
rebound. In the coming months, economic data will likely indicate the economy’s responsiveness to federal
policies, including trade policy, tax reform, and immigration policy.
Second quarter 2025 U.S. real gross domestic product (GDP) rebounded after declining in the first quarter,
though much of the variation over these quarters was the result of efforts to mitigate the impact of tariffs. Personal
consumption expenditures, which comprise roughly two-thirds of GDP, showed a trending decline, where the
year-over-year (YoY) growth rate has fallen roughly one percentage point since late 2024. Business investment
also declined—likely another tariff-related response, as businesses continue exhausting pre-tariff stockpiles of
imported inventories.
Although the unemployment rate has remained mostly stable, the monthly jobs report indicated a steep decline in
employment growth and sharp downward revisions to the May and June employment numbers. In July, the
economy added only 73,000 jobs, while the May and June jobs were revised, respectively, from 144,000 to 19,000
and from 147,000 to 14,000—a combined reduction of 258,000 jobs in those two months. This shows a clear labor
market deceleration, which could prompt the Federal Reserve (Fed) to cut short-term interest rates in the coming
months.
During their meeting in late July, Fed officials held interest rates steady while expressing a growing concern
over slowing labor markets. The Fed’s policy-voting committee, the Federal Open Market Committee (FOMC),
acknowledged the lingering prospect of resurgent inflation caused by tariffs, which could emerge with
lags. However, a growing share of voting members indicated an inclination to continue lowering rates in the
coming months as they balance their dual mandate of price stability and full employment. The FOMC meets again
in mid-September.
Stories We’re Following
Trade Policy
The issue: Since early April, President Trump has engaged in global trade negotiations involving tariffs
on global imports and international trade deals. This change in global trade policy has impacted trade
and capital markets while adding risk to the macroeconomic outlook. As uncertainty over the duration
and magnitude of the tariffs hangs over consumers and businesses, the possibility of sustained tariffs could
contribute to a restructuring of economic activity.
Updates: Continued negotiations with other countries have left U.S. businesses with heightened policy
uncertainty. As of early August, the average tariff rate was just above 20% with significant trade
negotiations remaining (Figure 1). The evolving restructuring of international trade is expected to have
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disparate impacts on different states, depending on their manufacturing capacity and trade intensity.
While the Texas economy could gain from the reallocation of manufacturing, its reliance on international
trade creates heightened sensitivity to trade policy.
Federal Reserve Policy
The issue: The Fed is tasked with achieving a dual mandate of price stability and full employment. As
inflation approaches the Fed’s 2% target, the central bank gains support for reducing interest rates to
accommodate slowing labor markets. As part of its broader balance sheet operations, the Fed also buys
and sells long-term private and public financial assets. Its divestment in mortgage-backed securities has
likely placed upward pressure on mortgage rates, which could continue for as long as the Fed allows the
balance sheet roll-off, even if it reduces short-term interest rates.
Updates: Despite holding the target short-term rate fixed in the July meeting, a growing share of Fed
officials showed support of cutting rates in future meetings. A key consideration is the impact of tariffs—
how big and how persistent price increases might be, if at all. As a result, some Fed officials favoring
delays in cutting rates prefer waiting for more data to determine the impact of tariffs.
Shelter Inflation
The issue: Shelter inflation measures the price increase in the cost of housing. It includes changes in rent
prices, as well as owner-equivalent rent—a measure of what owners would pay in rent for their own home
under current market conditions. This value not only provides a broad measure of housing costs, but it
also comprises approximately one-third of the entire consumer price index. Because of its large impact
on inflation measures, the value maintains a large impact on monetary policy.
Updates: Since reaching a peak in early 2023, this slow-moving value has fallen sharply and continues to
decline at nearly a constant rate (Figure 2). Given the persistence of the series, a continued decline could
push the overall inflation rate near or below the Fed’s 2% target. Moreover, because of the lags in
monetary policy effectiveness, the Fed might gain motivation to reduce interest rates sooner and, perhaps,
change its balance sheet policy in the coming months.
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Hiring Outlook
The issue: Several factors, including a slowing economy and policy-related uncertainty, have contributed
to a slowdown in hiring. Despite this slowdown, the rate of layoffs has remained constant (and possibly
slightly down) in recent months. This slowdown in both hiring and layoffs has contributed to stability in
the unemployment rate despite the broad labor market slowdown. The hiring outlook, based on business
survey data, provides a useful indicator of the broader labor market and macroeconomic outlook.
Updates: National Federation of Independent Businesses survey data shows that the share of businesses
planning to create jobs in the coming months remained low in July compared to recent years. Other data
from The Conference Board, ManpowerGroup, and Federal Reserve district banks confirmed a slowdown
in expected hiring—the exception being the Dallas Fed’s survey of Texas firms (discussed in the next
section).
Texas Economic Indicators
The Texas economy showed signs of a recent dip in economic activity, possibly reflecting the impact of the trade
war and lower oil prices. Several Texas metropolitan areas, including each of the large metropolitan areas,
showed a decline in employment in June. Despite this decline, survey data from the Federal Reserve Bank of
Dallas showed a strong rebound in the hiring outlook that spanned each of the major sectors of the Texas
economy. Moreover, longer-term measures, including YoY employment growth, still show the Texas economy
outperforming the broader U.S. economy (Figure 3).
Employment
Texas employment contracted by 0.1% in June (Figure 4), falling below the national rate, which was close to
zero. Month-over-month (MoM) employment growth fell in every metropolitan area of Texas, with losses
offsetting much of the previous month’s gains. Jobs reports were mixed across the other metropolitan regions,
with seven regions experiencing gains and the remaining 11 experiencing losses.
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Each of the goods-producing industries experienced losses in June, with Mining and Logging experiencing the
largest losses—likely due to losses in the energy sector from declining oil prices (Figure 5). MoM employment
grew in the Information, Education & Health Services, and Government service industries while declining in the
remaining service industries. Gains in Education & Health Services follow broader national trends of gains in
these industries.
Employment Outlook
The share of Texas firms planning to hire in the next six months showed a strong rebound in each of the three
major sectors, providing growing evidence of an improvement in the state economic outlook (Figure 6). The
number of firms planning to decrease employment fell in July in the manufacturing and retail sectors, while
increasing in the services sector. These values, however, remain well below May highs, indicating a moderation
in the employment outlook following the onset of the global trade war in April. This employment outlook remains
a critical indicator, as a slowdown in hiring could lead to an increase in the unemployment rate.
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Housing and Mortgage Rates
Mortgage rates remained elevated but stable in July, as rates fell by 5 basis points from 6.77% to 6.72% (Figure
7). Broad-based housing cost measures across the U.S. continued showing deceleration in the housing market,
as heightened mortgage rates and a sustained macroeconomic deceleration continue weighing on housing market
activity. The Federal Reserve kept short-term rates fixed in its July meeting, although a growing share of voting
members of the FOMC supported future rate cuts. While mortgage rates could be impacted by future Fed short-
term interest rate cuts, mortgage rates will also be impacted by the Fed’s balance sheet policy, in which the
central bank directly buys and sells mortgage-backed securities. As a result, anticipating changes in mortgage
rates requires an understanding of both Fed’s interest rate changes and changes in its balance sheet policy.
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The mortgage spread (Figure 8)—defined as the premium of mortgage rates over the 10-year Treasury yield—
fell 10 basis points in July, from 247 to 237 basis points (i.e., from 2.47% points to 2.37% points). The mortgage
spread, which provides useful context of mortgage rates in broader capital markets, remains elevated compared
to the historical range of 150-175 basis points. This suggests that as capital markets normalize, mortgage rates
could decline by another 75 to 100 basis points, relative to the 10-year Treasury yield.
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TEXAS HOUSING INSIGHT (EXCERPTS)
Texas A&M University – Texas Real Estate Research Center
Yanling Mayer (August 27, 2025)
Summary
It’s becoming more apparent that the housing market is facing a concerning supply and demand (more precisely,
effective demand) imbalance, as rapidly growing inventory continues to outpace constrained buyer
affordability—in Texas especially. The last time the state experienced such elevated levels of inventory was in
2013 when the U.S. housing market was just beginning to crawl out of the Great Recession.
It has turned the normally busy and more seller-friendly spring market into one marked by steepening price
cutting and increasingly favorable pricing conditions for buyers. Sellers of existing homes are also contending
with heightened competition from homebuilders, who are increasingly offering affordability incentives using
mortgage rate buydowns and closing costs assistance to attract buyers.
Unprecedented inventory availability, coupled with significant sellers’ willingness to negotiate prices, has
sparked a surprising resurgence in buyer interest, and buyers swiftly capitalized on the shifting market dynamics,
driving a sharp rebound in June home sales and reversing the early spring slump. Forward-looking indicators,
including pending sales data, point to sustained momentum into July, with total closing on track to surpass 2024
levels.
Property values across Texas continue to show signs of weakening. According to the Texas Real Estate Research
Center’s Home Price Index, June marked the third consecutive month of little to no year-over-year (YoY) price
growth statewide. Even Houston, long considered one of the most resilient markets, reflected the broader
slowdown. June was the first time since December 2011 that the city’s home prices failed to register any annual
gain, representing a significant break in the trend. Meanwhile, markets such as Austin, Dallas, and San Antonio
are leading the decline, with prices continuing to slide under the pressure of elevated inventory and affordability
challenges.
While mortgage rates have eased slightly from recent highs, the drop remains insufficient to meaningfully lift
buyer affordability. At the same time, Texas is mirroring broader labor market softening, with the June job report
showing modest job losses and a large downward revision to May’s figures from earlier estimates.
Compounding these pressures, the July CPI report indicates inflation is reaccelerating, reflecting the impact of
new tariffs. Inflationary pressure from new tariffs is likely to persist in the near term as businesses are anticipated
to begin shifting the costs—either partially or in full—through higher prices on goods and services. In light of
the shifting economic dynamics, will the Federal Reserve consider a proactive rate cut as early as September to
counter the risk of a deeper slowdown? Such a move could offer much-needed relief to homebuyers and bring out
pent-up demand, helping restore stability in the housing market.
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June Home Sales Bounce Back, Improving Year-To-Date Performance
Texas recorded 32,157 closed home sales in June—including both new and existing homes—accounting for 8.2%
of all U.S. home sales that month. Year-to-date, the state’s share stands at 8.6 percent.
June home sales bounced back sharply, up 7.7% YoY. Year to date, home sales mirror 2024 levels.
Nationally, seasonally adjusted home sales were flat from June 2024. Sales declined 2.7% month over
month (MoM) since May. The MoM declines were driven by declines in the Northeast (8%) and the
Midwest (4%). Sales in the South were down 2.2%, while sales in the West remained steady and were up
1.4%. Year to date U.S. home sales were 1.5% below 2024.
Texas’ statewide median home price in June reached $345,000, a small YoY increase from $340,000 in
June 2024. The Texas Real Estate Research Center’s Home Price Index, which is a repeat sales index and
controls for the quality of homes, showed no YoY price change from June 2024.
Nationally, the median home price rose to $435,300, up modestly from $423,700 YoY.
Pending home sales in June point to another statewide increase in overall sales volume.
Growing Inventory Drives Steepening Seller Price Concessions
As of June, the inventory is at 5.7 months’ supply, up from 5.5 months in May and 4.5 months a year ago.
In Texas, a relatively balanced inventory typically ranges from three to four months, with seasonal
fluctuations within that band.
The median days on market (DOM) in June was 36 days—up by 7 days from a year earlier. On average,
homes closed in June spent 60 days on the market, not including closing time.
The average time to close a pending sale remains steady at approximately 30 days. As the peak spring
homebuying season tapers off, lenders are reporting a noticeable decline in loan pre-approval requests.
In June, sellers reduced prices by $5,000 or more in two-thirds of closed sales, with average concessions
rising to $13,000—up from $10,000 YoY and $11,500 MoM.
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Active Inventory Growth Persists But Momentum Slows
As of June, more than 156,000 homes were actively listed for sale—a 27.2% YoY increase—pushing
inventory to its highest level in 14 years.
As the spring homebuying season winds down, the pace of inventory growth has moderated. Active listings
increased by 3.4% MoM—significantly slower than the 7.1% rise seen in May and 7.8% in April.
May typically marks the peak of new listing activity, aligning with the seasonal high in buyer demand
during the spring homebuying surge.
At the current pace of sales, the inventory turnover ratio stands at one sale for every five active listings,
down from nearly one in four a year ago, indicating a slower market pace
New Listing Activity Peaks as Seasonal Slowdown Sets In
Year-to-date new listing activity is significantly more active than in previous market cycles despite
millions of homeowners being locked into a low-rate mortgage, which contributes to a slow housing
market.
Year to date, new listings are up 12.6% from 2024 and are more than 20% above pre-pandemic levels of
seller activity.
Not shown) Separately, new listings of existing homes have notably outpaced those of new construction.
Existing home listings are up 14.3%, compared to a 7% increase in new construction.
New listings of existing homes have declined from their peak levels observed in May, indicating a seasonal
slowdown in market activity.
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Regional Price Softening Persists and Widens
Statewide home prices remained unchanged from June 2024, marking the second consecutive month
without YoY gains.
Notably, for the first time since December 2011, Houston saw no YoY price gain in June, a marked
departure from its consistent trend of home price appreciation averaging around 2%.
The inventory pressure in Houston has quickly intensified going into 2025. Since January, active inventory
has surged 34% YoY and is showing no signs of tapering off as late as July.
High inventory is continuing to place downward price pressure in Austin, Dallas, and San Antonio, but
has also helped driving sales as buyers are positioned to negotiate price concessions.
In June, the Big Four metros saw median price reductions of $15,000 in Dallas, Houston, and San
Antonio, and $24,000 in Austin.
Local Housing Market Indicators
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DALLAS-PLANO-IRVING METRO DIVISION QUARTERLY HOUSING REPORT (EXCERPTS)
Texas A&M University – Texas Real Estate Research Center
Second Quarter, 2025)
Executive Summary
Metro area sales volume increased 1.7% to 17,929 transactions. Median price decreased 2.3% year-
over-year to $420,000.
2025 Q2 months inventory for all residential properties rose 32.5% year-over-year to 5 months.
Metro area residential property listings increased 38.1% year-over-year to 25,980 active listings.
Map of Dallas-Plano-Irving Metro Division
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Median Price Change (YoY)
According to TREC, median sale price change year-over-year (YoY) in the subject’s area near Crystal Park PID
No. 2 IA #1 decreased between 1% and 11%.
Sales Volume Change (YoY)
According to TREC, sales volume change year-over-year (YoY) in the subject’s area near Crystal Park PID No.
2 IA #1 is over 11%.
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Median price in the Dallas-Plano-Irving metro decreased by approximately 2.3% year-over-year, from $431,000
to $420,000. Metro area price exceeded the statewide median price of $340,000 by $80,000 as shown in the
following chart:
2025 Q2 total sales volume increased by approximately 1.7% year-over-year, from 17,629 to 17,929. Sales of
homes between $300k and $400k rose from 4,296 to 4,452, while homes between $500k and $750k dipped from
4,067 to 3,942, and homes between $400k and $500k dipped from 3,247 to 3,088 as shown in the following graph:
Metro area months inventory increased year-over-year from 3.77 to 5 months. Homes between $300k and $400k
rose year-over-year, from 3.31 to 4.48 months, while homes between $500k and $750k rose year-over-year, from
4.16 to 5.47 months and homes between $400k and $500k rose year-over-year, from 3.66 to 5.13 months as shown
in the following graph:
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Average days to sell throughout the metro area increased from 77 to 86 days, an increase of 11.7% year-over-
year. Average days to sell for homes between $300k and $400k increased from 74 to 87 days, a 17.6% increase
year-over-year as shown in the following graph:
Homes in the $400s and above fell to 47% of single-family new construction sales through the MLS. The second
most active price range was homes in the $300s, which grew from 29.7% to 32.4% year-over-year as shown in
the following graph:
In the latest quarter, the average price was $482,657 for new homes sold through the MLS, a decrease over last
year's figure of $501,577. The average price for existing homes was $586,495, an increase over last year's figure
of $568,791 as shown in the following graph:
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The following chart shows the housing metrics for Collin County:
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S&P CORELOGIC CASE-SHILLER INDEX
June 2025
Data reported from the Standard & Poor Dow Jones Indices (1-year and 3-year graphs shown below) from end of
June 2025 showed that home prices nationally were up 1.89% YoY while the Dallas Metropolitan area also
decreased by 0.95%.
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CONSUMER PRICE INDEX (CPI)
MOODY’S ANALYTICS CONSUMER PRICE INDEX (CPI) CHART
In line with Moody’s Analytics expectations, the consumer price index picked up steam in July. The 0.2% increase
in the headline CPI marked a modest deceleration from June’s pace, but the slowdown was primarily a function
of falling energy prices. The 12-month rate was unchanged at 2.7%. Food prices were flat. Excluding food and
energy, core CPI rose 0.3% in July. The increase was a touch stronger than expected and lifted the year-ago rate
from 2.9% to 3.1%. Import-intensive products saw another heady month of price increases.
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REGIONAL ANALYSIS
The subject is located in Collin County within the Dallas-Plano-Irving Metropolitan Statistical Area (MSA), often
combined with the Fort Worth-Arlington-Grapevine MSA, and more commonly referred to as the Metroplex
DFW), which encompasses parts of 16 counties and contains 23 cities with populations over 50,000 in North
Central Texas. As reported by the North Central Texas Council of Governments (NCTCOG), the estimated
January 1, 2024, population for the NCTCOG region is 8,481,512. Last year the region added just under 200,000
people, nearly 40,000 more residents than were added in 2022. Dallas (30,201) added more population than any
other city, followed by Fort Worth with just under 27,000 and surpassing 1 million residents. Celina (10,826),
Frisco (6,696), and Princeton (6,374) round out the top 5 growth cities. For the second straight year, Collin County
added more than 53,000 new residents while Dallas County added almost 42,000 and Tarrant County added over
35,000 new people. Since 2020, 650,000 new residents now call north Texas home. Contributing about one-third
of Texas’ GDP, the economy is the most diverse in the state. DFW is home to many business and professional
services from major financial institutions to international law firms. It is also home to one of the top ranked
container ports in the US and an extensive infrastructure network that serves multiple hotbeds for e-commerce
fulfillment.
The region is anchored by two major passenger airports: Dallas-Fort Worth International Airport (DFW), which
is the second busiest airport in the world in terms of aircraft movements and the largest hub for American Airlines,
and Dallas Love Field Airport (DAL), which is a city-owned airport and the largest hub for Southwest Airlines –
the largest carrier in the nation in terms of passengers carried.
MAP OF DALLAS-FORT WORTH METROPLEX
Red Lines Showing Collin County Boundary
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When compared to the national economy, the DFW Metroplex is expected to experience expansion arising from
growth in a variety of sectors including construction, transportation, manufacturing, finance, healthcare, business
services, science and technology, education, and real estate. The expansion is fueled by the region’s strategic
location in the center of the country and is located at the nexus of major roadways such as Interstates 35, 30, 20,
and 45. It is predicted by most analysts that economic activity in the area will exceed the state and national growth
averages across most indicators. The region is set for long-term development due in part to its transportation
infrastructure, low cost-of-living, business friendly regulatory environment, mild weather, young population, and
large work force.
A chart of the four counties in the Metroplex, with the highest populations is shown below. Dallas County is the
most populated county in the region with 2,613,539 residents, followed closely by Tarrant County with 2,110,640,
Collin County with 1,064,465, and Denton County with 906,422. Other outlying counties such as Ellis, Johnson,
Parker, Kaufman, Rockwall, Wise etc. add up to another 1,014,476 residents. The subject property is in the
northwest quadrant of Collin County.
PIE CHART OF POPULATION PERCENTAGES IN DFW METROPLEX
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COLLIN COUNTY OVERVIEW
Collin County, Texas, is a rapidly expanding and affluent county nestled in the northeastern corner of the Dallas–
Fort Worth metroplex. Its county seat is McKinney, and the region bears the name of Collin McKinney, a
historical figure in Texas’s founding. The county’s population surged from approximately 782,300 in 2010 to
and continues to grow swiftly, with mid-
County ranks among the wealthiest and healthiest in Texas, with a median household income exceeding $100,000
and low social vulnerability. Economic vitality is on full display, with major investments like the Collins
Aerospace expansion in Richardson and plans for a Universal Studios theme park in Frisco. Communities across
the county consistently earn top marks for quality of life, making Collin County a standout region in terms of
growth, prosperity, and livability.
MAP OF COLLIN COUNTY
Subject Located in the Northwest Quadrant of Collin County
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CITY OF ANNA OVERVIEW
Anna, Texas, is a rapidly growing city located in northern Collin County, about 40 miles north of downtown Dallas.
Originally a small railroad town in the late 19th century, Anna has evolved into a vibrant suburban community while
maintaining its rural charm. Known for its family-friendly atmosphere, good schools, and affordable housing, Anna
attracts both longtime residents and newcomers seeking a quieter lifestyle with access to the amenities of the Dallas-
Fort Worth metroplex. The city hosts several community events throughout the year, including parades, festivals, and
outdoor markets, reflecting its strong sense of local pride and neighborly spirit. With ongoing residential and
commercial development, Anna continues to shape its future as one of North Texas’s most promising small cities.
MAP OF THE CITY OF ANNA
Subject Located in Southwest Anna
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NEIGHBORHOOD ANALYSIS
A neighborhood may be defined as a section of a community or an entire community. It refers to relatively unified
areas with definite boundaries which exhibit a fairly high degree of homogeneous uses – basically a group of
complimentary land uses that exhibit a greater degree of commonality than the larger area. The boundaries of a
neighborhood define the geographical area which exerts influence on the value of the subject property. Crystal
Park PID No. 2 IA #1 is located within the City of Anna, Collin County.
NEIGHBORHOOD MAP
Geographic radii of 2 and 5 miles indicating the approximate neighborhood boundaries around the Subject
2 Miles 5 Miles
North Hurricane Creek Cartwright Road
East Cedar Creek Drive Farm-to-Market 455
South County Road 282 U.S. Highway 75
West East Fork Trinity River Daisy Lane
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NEIGHBORHOOD DEMOGRAPHICS
The subject is located in census tract 0302.02 with the FFIEC Geocode Census Report shown on the following
page. The census tract report for 0302.02 indicates that 6,345 people reside in the tract and family median income
levels are in the upper tier with estimated median family incomes of $180,870. Within census tract 0302.02,
approximately 81% of housing units are owner-occupied with 11% being renter-occupied and 8% being
vacant. These housing and demographics statistics indicate upper class residents who tend to live in single-family
homes.
Census Tract 0302.02 Map
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Tract 0302.02 Census Report
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DEMOGRAPHIC SUMMARY
Analytics from CoStar of the area are provided below. Within a 10-mile radius of the subject there are 123,837
people which represents a 9.10% annual increase in population since 2020 and highlights steady growth that has
occurred in this portion of Collin County. The population growth is expected to increase in the coming years and
grow another 4.7% annually over the next five years. Median household incomes in the 10-mile radius is $98,949.
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EMPLOYMENT DATA
A table of the 2, 5, and 10-mile radius employment figures are shown below. The numbers highlight the area’s
economy with most employees in the area surrounding the subject of service-producing industries.
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CoStar Analytics – Map of Median Household Income
As indicated by the map below, median incomes in the vicinity of the subject property are between $94.8K and
97.8K. Median incomes north of the DFW metroplex tend to be higher in suburban areas outside the population
centers in Dallas and Fort Worth. This is especially true in areas north of Dallas where affluent communities have
concentrated for the past few decades.
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CoStar Analytics – Housing Statistics
Most housing in the area (63%) are homes that were built after 2010. This is consistent with the growth stage of
the surrounding area which has experienced numerous residential subdivision developments in recent years.
CoStar Analytics – Housing Statistics
In addition, the vast majority (95%) of housing in the 5-mile radius consists of single unit housing stock. The
subject property is being developed with detached single-family housing that is consistent with the surrounding
area.
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Map of Notable Nearby Developing Residential Subdivisions
A map of notable built out, developing, and planning single-family residential subdivisions are shown below
which highlights the similar and conforming uses around the subject property.
1 Milrany Ranch
2 Meadow Vista
3 Stoneridge
4 Venetian Lagoon
5 West Crossing
6 Liberty
7 The Dawn
8 Tinsley Meadows
MAP KEY
Crystal Park Public Improvement District No. 2 Improvement Area #1
48
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
ABSORPTION ANALYSIS
RESIDENTIAL ANALYSIS
The subject property is Crystal Park PID No. 2 IA #1 which consists of approximately 47.859 acres in Collin
County being developed into detached single-family lots for residential use. The property is owned by Bloomfield
Homes, LP.
When analyzing the financially feasible and maximally productive use of the site, uses that are both physically
possible and legally permissible must be considered. An important factor affecting the development of the subject
is the surrounding land usage.
development as that conforms to recent land development in the surrounding area around the City of Anna. The
neighborhood is best described as West of State Highway 75 and south of Country Road 455. The neighborhood
is primarily agricultural land with scattered single-family dwellings. At the entrance to the subject property,
Country Road 286 runs north/south, which connects the subject to Country Road 455.
Since the recession in 2008, the residential real estate market in this area of North Texas has continuously
improved, and the City of Anna has experienced this consistent population growth. Low interest rates persisted
nationally in 2020 and 2021, and the markets rose significantly, but 2022-2024 and into the beginning of 2025
we have seen higher interest rates as the Fed seeks to combat inflation. Still, with large numbers of immigration
from outside DFW from higher cost-of-living states and an abundance of steady jobs, demand for residential real
estate in growing communities like Anna is expected to remain strong. Those end-user homebuyers in Crystal
Park PID No. 2 IA #1 are expected to be middle-to-upper-income earners as the average home price for finished
single-family homes in the community is expected to start in the $500,000s to $600,000s.
Demand for vacant developed lots (VDLs) for home builders is currently very high; however, material and labor
shortages were well-publicized in 2021 and have continued to ease in late-2022 and in 2023 according to the
Texas Real Estate Research Center. Developable residential land in DFW with good access to Dallas is in high
demand with developments moving ever further away from the Dallas CBD and highly developed areas north of
Dallas where vacant land is scarce after decades of growth. The subject property –Crystal Park PID No. 2 IA #1–
is removed from the large Central Business Districts in the Metroplex but relatively near areas of Collin County
where many young families have migrated when searching for safe neighborhoods, good schools, relatively
affordable new homes, and desirable residential amenities.
be analyzed using historical absorption data provided by Zonda as well as information obtained from area market
participants and developers. It is important to note that our absorption data is based on historical trends and
current available data. Since the first residential lots are scheduled to be complete July 1, 2026, we will analyze
the historical trends and attempt to forecast the absorption rates based off data, analytics, and our conversations
with developers in the market.
We determined a 10-mile radius around the subject property is suitable for our absorption analysis as the
competitive supply of lots is within this area. Further, we examined residential communities with lot widths
between 50’- 65’ front foot.
Crystal Park Public Improvement District No. 2 Improvement Area #1
49
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
The construction pace data reveals a measurable deceleration in homebuilding activity over the past
year. Quarterly housing starts declined by 36%, from 457 units in 2Q 2024 to 293 units in 2Q 2025, while annual
starts dropped 17%, from 1,699 to 1,416 units. This contraction in new construction suggests a cautious approach
by builders, likely in response to market absorption rates or economic uncertainty.
On the demand side, quarterly observed closings fell 20% (from 451 to 360 units), yet annual closings increased
by 8%, rising from 1,436 to 1,547 units. This divergence indicates that while short-term sales activity has slowed,
the market has still managed to absorb a higher volume of homes over the year. This pattern supports a narrative
of reduced supply-side pressure with steady buyer demand.
Crystal Park Public Improvement District No. 2 Improvement Area #1
50
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
DEFINED SUBMARKET AREA
As shown in the previous chart, the absorption of lots (determined from home construction starts) within the
selected area has increased from 2Q2021 to 2Q2025, According to Zonda, the selected area absorbed the
following number of 50’-65’ lots year-over-year from 2Q 2021 to 2Q 2025:
2Q 2021 - 1,283 lots absorbed
2Q 2022 - 831 lots absorbed
2Q 2023 - 1,371 lots absorbed
2Q 2024 - 2,050 lots absorbed
2Q 2025 - 2,139 lots absorbed
From 2021-2025, the annual average of lots absorbed was 1,535 (7,674 ÷ 5)absorption
of lots (2Q2023 to 2Q2025), the annual average of lots absorbed increases to 1,853 (5,560 ÷ 3) lots in the area.
4950 1283
831
1371 2050
2139
0
1000
2000
3000
4000
5000
6000
1Q
2019
2Q 2021 2Q 2022 2Q 2023 2Q 2024 2Q 2025 Lots Developed
Within 10-Mile Radius Around Crystal Park
PID No. 2 IA #1
Crystal Park Public Improvement District No. 2 Improvement Area #1
51
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
COMPETITIVE SUPPLY (LOT INVENTORY)
According to Zonda, the supply of available housing in the selected submarket is showing signs of decline. The
number of Vacant Developed Lots (VDLs) had steadily increased from a low of approximately 700 lots in 2Q
2021 to a peak of around 2,700 lots in 4Q 2024, accompanied by a 20.5-month supply. However, over the past
two quarters, this trend has reversed, with the VDL count declining to just under 2,400 lots and the months
of supply easing slightly to 20 months.These figures suggest the market is currently in a state of relative
balance. It’s important to note that the geographic scope of this data spans a broad area, likely encompassing
multiple active residential corridors and master-planned communities—factors that enhance the submarket’s
appeal to buyers seeking affordability and access to expanding infrastructure.
Thus, the total lot supply is considered to be at a balanced supply level for a significantly developing market.
Also, taking into consideration that new developments require a typical 12-to-18-month construction period, with
increasing demand and declining lot supply, it appears that additional lot product in the submarket is feasible at
the current time. This corresponds to discussions we had with DFW homebuilders who state there is a scarcity
of vacant developed lots currently on the market which is pushing prices higher.
Having considered the supply of lots in the market, it is now prudent to examine the absorption history of specific
competing subdivisions in the subject’s market area with similar lot features and amenities relative to the subject
to determine the projected absorption of the subject’s proposed lots.
Crystal Park Public Improvement District No. 2 Improvement Area #1
52
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
ABSORPTION ANALYSIS – 50’ AND 60’ LOTS
The similarities considered to be most important are lot size, home price range, and amenity features. The tables
that follow detail the active subdivisions that are considered to compete with the subject’s lots. All data is per
Zonda from 2Q2021 to 2Q2025.
50’ Lots
We included data for lots that were 50’ lots within a 10-mile radius. Since data on 50’ lots is relatively plentiful,
we selected four comparable absorption schedules at nearby communities we concluded are similar to the subject
and considered some of these communities are smaller and some larger than Crystal Park PID No. 2 IA #1.
Our analysis indicates Starts/Month is between 1.8 and 6.3 with an average of 3.8 starts/month and a median of
3.7 starts/month. We similarly weighed and considered the subject property’s 50’ lots would likely absorb 4
lots/month, or approximately 12 lots per quarter.
60’ Lots
We included data for lots that were 55’-65’ lots within a 10-mile radius. Since data on 60’ lots is relatively
plentiful, we selected four comparable absorption schedules we concluded are similar to the subject and
considered some of these communities are smaller and some larger than Crystal Park PID No. 2 IA #1.
Our analysis indicates Starts/Month is between 1.0 and 3.8 with an average of 2.0 starts/month and a median of
1.3 starts/month. We similarly weighed and considered the subject property’s 60’ lots would likely absorb 2
lots/month, or approximately 6 lots per quarter.
Subdivision
Size
Foot Front)
Available
Lots Starts Months
Available
Supply
Months)
Starts
Month
Trails of Elizabeth Creek 50' 72 21 12 41.1 1.8
Legends Ranch 50' 244 30 12 97.6 2.5
Keller Crossing 50' 4 58 12 0.8 4.8
Justin Crossing 50' 231 75 12 37.0 6.3
137.8 46.0 12.0 44.1 3.8AVERAGE
Subdivision
Size
Foot Front)
Available
Lots Starts Months
Available
Supply
Months)
Starts
Month
West Crossing 55'-65' 22 45 12 5.9 3.8
Liberty 60'-65' 58 15 12 46.4 1.3
The Dawn 65' 6 12 12 6.0 1.0
Tinsley Meadows 65' 15 24 12 7.5 2.0
25.3 24.0 12.0 16.4 2.0AVERAGE
Crystal Park Public Improvement District No. 2 Improvement Area #1
53
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Absorption Summary Projection: 50’ and 60’ Lots
Based on the preceding, we estimate that lots in the subject property’s development will sell 12 lots/quarter for
50’ lots and 6 lots/quarter for 60’ lots with absorption beginning July 2026. An Absorption Summary Projection
for all lot sizes is shown in the table below for the 171 lots in Crystal Park PID No. 2 IA #1.
The total absorption period for the 50’ lots is expected to be ~31 months (123 ÷ 4 lots/month) and expected to
sell out in January 2029. The total absorption period of the 60’ lots is expected to be ~24 months (48 lots 2
lots/month), and lots are expected to sell out in June 2028. Lot Type
Jul-2026 Oct-2026 Jan-2027 Apr-2027 Jul-2027 Oct-2027 Jan-2028 Apr-2028 Jul-2028 Oct-2028 Jan-2029 TOTAL 50-FF
12 12 12 12 12 12 12 12 12 12 3 123 60-FF
6 6 6 6 6 6 6 6 - - -48 Total 18
18 18 18 18 18 18 18 12 12 3 171 Projected Quarterly
Absorption Summary - Crystal Park PID No. 2 IA #1
Crystal Park Public Improvement District No. 2 Improvement Area #1
54
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SUBJECT PROPERTY ANALYSIS
The entire development of Crystal Park Public Improvement is 274.396-acres and located in the City of Anna,
Texas and will consist of 5 total phases with 946 lots, however, the subject of this appraisal is Crystal Park PID
No. 2 IA #1 represents a total of approximately 47.859 acres (2,084,738-SF) and is currently being developed
into one distinct area of single family lots as follows:
Crystal Park PID No. 2 IA #1 will consist of 123 50-FF lots and 48 60-FF lots with a total of 171 improved
residential lots on approximately 47.859 acres.
The following chart shows the lot breakdown of Crystal Park PID No. 2 IA #1:
Area Type Size (Acres)
50' Lot
Type
60' Lot
Type
Total Lots
Appraised
Residential Lots 47.859-AC 123 48 171
Crystal Park PID No. 2 IA #1
Crystal Park PID No. 2 IA #1 is owned by Bloomfield Homes, LP, who will also be the developer for the subject
property. Crystal Park PID No. 2 IA #1 is located in the southwest portion of the City of Anna. This location is
in the northwest quadrant of Collin County and nestled in the northeastern corner of the Dallas–Fort Worth
metroplex. The area surrounding the subject property is agricultural land.
Access to the subject property is considered average as it is located south of Country Road 455 and west of U.S.
Highway 75. Generally, the main retail and commercial options near the subject site are found east of the subject
along U.S. Highway 75 within the City of Anna, which has been steadily developing with a number of master-
planned communities in the past decade.
The subject property will have a mandatory homeowner’s association (HOA) over residential portions of the
subject property in order to maintain open spaces, common areas, detention areas, and other related improvements
or appurtenances that are not dedicated or maintained by the City of Anna.
Based on research and discussion with the development team, the price point of homes in the subject’s community
will be starting in the $500,000s to $600,000s, which should be a desirable price point for families and second-
and third-time homebuyers looking for a quiet community with the small-town charm of Anna but with the
amenities of a planned residential community.
The following information, which was provided by the developer, describes the authorized improvements to the
subject property.
Crystal Park Major Improvements Description
Paving/Roads/Streets
Improvements including subgrade stabilization, reinforced concrete for roadways, headers, barricades,
signs, striping, and traffic control. All related earthwork, excavation, clearing & grubbing, erosion
control, intersections, signage, lighting, and re-vegetation of all disturbed areas within the right-of-way
are included. The road improvements will provide benefit to each Lot within the District.
Crystal Park Public Improvement District No. 2 Improvement Area #1
55
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Water
Improvements including trench excavation and embedment, trench safety, PVC piping, water main
connections, water meters, testing, related earthwork, excavation, erosion control, fire hydrants, platting,
staking, and all necessary appurtenances required to provide water service to all Lots within the District.
Sanitary Sewer
Improvements including trench excavation and embedment, trench safety, PVC piping, encasement,
manholes, sewer main connections, service connections, testing, related earthwork, excavation, erosion
control, platting, staking, and all necessary appurtenances required to provide wastewater service to all
Lots within the District.
Storm Drainage
Improvements including trench excavation and embedment, RCP piping, curb and drop inlets, headwalls,
wingwalls, manholes, rock rip rap, and trench safety as well as all related earthwork, excavation, erosion
control, platting, staking, and all necessary appurtenances required to provide storm drainage for all Lots
within the District.
Soft Costs
Costs related to designing, constructing, and installing the Major Improvements including inspection fees,
City fees, bonds, engineering, soil testing, survey, construction management, contingency, legal fees, and
consultants.
District Formation Costs
Costs associated with forming the District, including, but not limited to, attorney fees, and any other cost
or expense incurred by the City or the Developer directly associated with the establishment of the District.
Crystal Park Improvements Description
Paving/Roads/Streets
Improvements including subgrade stabilization, reinforced concrete for roadways, handicapped ramps,
sidewalks, pavement connections, headers, barricades, CBU pads, signs, platting, staking, and
streetlights. All related earthwork, excavation, clearing & grubbing, tree removal, erosion control,
intersections, signage, lighting, screening walls, and re-vegetation of all disturbed areas within the right-
of-way are included. The road improvements will provide benefit to each Lot within Improvement Area
1.
Water
Improvements including trench excavation and embedment, trench safety, PVC piping, water main
connections, water meters, service connections, testing, related earthwork, excavation, erosion control,
fire hydrants, platting, staking, and all necessary appurtenances required to provide water service to all
Lots within Improvement Area #1.
Crystal Park Public Improvement District No. 2 Improvement Area #1
56
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Sanitary Sewer
Improvements including trench excavation and embedment, trench safety, PVC piping, encasement,
boring, manholes, sewer main connections, service connections, testing, related earthwork, excavation,
erosion control, platting, staking, and all necessary appurtenances required to provide wastewater service
to all Lots within Improvement Area #1.
Storm Drainage
Improvements including trench excavation and embedment, curb and drop inlets, RCP & RCB piping and
boxes, headwalls, manholes, rock rip rap, concrete outfalls, storm drain connections, trench safety, and
testing as well as all related earthwork, excavation, erosion control, encasement, platting, staking, and
all necessary appurtenances required to provide storm drainage for all Lots within Improvement Area #1.
Soft Costs
Costs related to designing, constructing, and installing the Improvement Area #1 improvements including
land planning and design, inspection fees, franchise fees, City fees, bonds, engineering, soil testing,
survey, construction management, contingency, legal fees, and consultants.
The charts on the following page shows a breakdown of the costs associated with Crystal Park PID No. 2 IA #1
provided by LJA Engineering Inc., the Professional Engineers.
Crystal Park Public Improvement District No. 2 Improvement Area #1
57
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Crystal Park Public Improvement District No. 2 Improvement Area #1
58
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
ACCESSIBILITY, FRONTAGE, AND STREETS
The subject property is primarily accessed by Country Road 286 which is a north/south bound two lane road
within the City of Anna and transverses along the eastern line of the subject property and connects the property
to U.S. Highway 75 and Farm-to-Market 455 (West White Street).
A map below from TXDOT shows traffic counts near the subject property. Farm-to-Market 455, which is an
east/west road that runs north of the subject property reports over 12,000 average daily vehicles. U.S. Highway
75, which is a north/south throughfare that runs east of the subject property and through the City of Anna reports
over 84,000 daily vehicles.
TXDOT Traffic Web Viewer
Crystal Park Public Improvement District No. 2 Improvement Area #1
59
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
ZONING AND RESTRICTIONS
The City of Anna has passed Resolution 2025-02-1744, to create Crystal Park Public Improvement District. The
PID includes approximately 274.396 acres, which includes the 47.859 contiguous acres in Crystal Park PID IA
1.
Development of the subject property will be governed by the Zoning Ordinance and the Development Agreement
among the Developer, the City of Anna, and other owner parties. The Development Agreement for the subject
property we are evaluating allows for single family residential uses on the subject property and sets forth
requirements and standards for residential development for the subject property.
The subject property is zoned Planned Development by the City of Anna. The Planned Development zoning in
the City of Anna is intended to provide for combining and mixing of uses to permit flexibility in the use and
design of land and buildings; however, our subject property (Crystal Park PID No. 2 IA #1) only encompasses
single-family use.
The subject must adhere to the City of Anna’s ordinance for PD Zoning and the Development Agreement between
the Developer and the City of Anna. The proposed lot construction appears to be a conforming land use. A zoning
map from the City of Anna, which appears to have not been updated to reflect the PD zoning is shown below.
CITY OF ANNA ZONING MAP
Crystal Park Public Improvement District No. 2 Improvement Area #1
60
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
TOPOGRAPHY
The topography of the subject property is described as gently sloping and is cleared as of the date of inspection.
As of the inspection date, September 15, 2025, these topographic maps showing the contours are slightly out-of-
date as the site is in the process of being improved for single-family lots with streets, storm sewer, and utilities in
place. Topographic information is provided by the North Central Texas Council of Governments and Texas A&M
Forest Service.
TOPOGRAPHIC MAP
Contours At 10’; Bold at 100’
Crystal Park Public Improvement District No. 2 Improvement Area #1
61
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
TEXAS A&M UNIVERSITY FOREST SERVICE – MAP MY PROPERTY
General Slope of the Property Moving from East to West
Note that measurements are in feet
Elevation profile is represented along illustrated axis
Property slopes east to west with approximately 18.07 feet of variation
over approximately 1,810 feet of run
Crystal Park Public Improvement District No. 2 Improvement Area #1
62
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
TEXAS A&M UNIVERSITY FOREST SERVICE – MAP MY PROPERTY
General Slope of the Property Moving from North to South
Note that measurements are in feet
Elevation profile is represented along illustrated axis
Property slopes south to north with approximately 8.30 feet of variation
over approximately 1,576 feet of run
Crystal Park Public Improvement District No. 2 Improvement Area #1
63
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SOIL AND SUB-SOIL CONDITIONS
No soil engineer’s report was available to the appraisers and no recent soil tests are known to have been
performed. We have assumed a stable soil condition that would ensure the structural integrity of any improvement
to be constructed. As of the report date, the developer has begun excavation and earthwork. Our value conclusions
are subject to revision should assumptions that land is stable prove incorrect. We caution and advise the user of
this report to obtain engineering studies which may be required to ascertain any structural integrity.
FEMA FLOOD ZONE
Based on map panel 48085C0155J dated June 2, 2009, approximately 100% of the subject site appears to be
located within unshaded Zone X, an area determined to be outside the 100-year and 500-year floodplains. This
determination is made by graphic plotting only and is not guaranteed. We recommend that a surveyor be utilized
to determine the precise status of the floodplain. Development within Unshaded Zone X does not appear to be
detrimental to the development of the subject property.
FLOODPLAIN MAP
UTILITIES
Electricity to the property will be maintained by Oncor and natural gas will be maintained by Atmos. Water and
sanitary sewer services are provided by the City of Anna. The subject property is served by the Anna Police
Department and the Anna Fire Department for fire and emergency medical services. Telephone, fiber-optic, and
internet are available through AT&T, Spectrum, T-Mobile, Optimum, and Nextlink.
Crystal Park Public Improvement District No. 2 Improvement Area #1
64
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
EASEMENTS/ENCROACHMENTS
A plat map by LJA Surveying, Inc. was provided to the appraisers by the client. Based on a review of the plat
map, GIS online maps, our physical site visit, warranty deeds, and review of available maps, there is a 5.356 acres
drainage & access easement that bisects the middle section of the subject property. This section will be utilized
as a hike and bike trail. Other than the aforementioned easement, it is reasonable to suspect that there are typical
setbacks and easements that exist on the subject property that have been approved by the City of Anna. The
appraisers assume the property is free from any other detrimental easements or encroachments and specifically
reserves the right to alter the conclusion of this analysis should another plat map be provided that indicates
detrimental easements or encroachments.
PLAT MAP
By LJA Surveying, Inc
Crystal Park Public Improvement District No. 2 Improvement Area #1
65
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
PLAT MAP
By LJA Surveying, Inc
Crystal Park Public Improvement District No. 2 Improvement Area #1
66
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
OIL AND GAS WELLS
Texas Railroad Commission
There are 0 well bottom sites and 0 well surface sites within 0.5 mile from the subject property according to the
above referenced map from the Texas Railroad Commission. The subject site does not appear to be encumbered
by any detrimental restrictions due to the proximity to surface or subsurface well locations because this area is
minimally active in mineral extraction.
Crystal Park Public Improvement District No. 2 Improvement Area #1
67
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 CONCEPT PLAN EXHIBIT
LJA Engineering, Inc. – August 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
68
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 LOT TYPE EXHIBIT
LJA Engineering, Inc. – August 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
69
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 EXHIBIT
LJA Engineering, Inc. – August 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
70
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 PAVING IMPROVEMENTS EXHIBIT
LJA Engineering, Inc. – AUGUST 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
71
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 PAVING MAJOR IMPROVEMENTS EXHIBIT
LJA Engineering, Inc. – AUGUST 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
72
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 SANITARY SEWER IMPROVEMENTS EXHIBIT
LJA Engineering, Inc. – AUGUST 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
73
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 SANITARY SEWER MAJOR IMPROVEMENTS EXHIBIT
LJA Engineering, Inc. – AUGUST 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
74
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 STORM IMPROVEMENTS EXHIBIT
LJA Engineering, Inc. – AUGUST 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
75
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 STORM MAJOR IMPROVEMENTS EXHIBIT
LJA Engineering, Inc. – AUGUST 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
76
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 WATER IMPROVEMENTS EXHIBIT
LJA Engineering, Inc. – AUGUST 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
77
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 WATER MAJOR IMPROVEMENTS EXHIBIT
LJA Engineering, Inc. – AUGUST 2025
Crystal Park Public Improvement District No. 2 Improvement Area #1
78
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 SURVEY
LJA Surveying, Inc. – SEPTEMBER 2021
Crystal Park Public Improvement District No. 2 Improvement Area #1
79
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
CRYSTAL PARK PID NO. 2 IA #1 SURVEY
LJA Surveying, Inc. – SEPTEMBER 2021
Crystal Park Public Improvement District No. 2 Improvement Area #1
80
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
PROPERTY PHOTOGRAPHS
Entrance to Subject Southeast Corner of Subject Facing South
Southeast Corner of Subject Facing Southwest Southeast Corner of Subject Facing North
Southeast Corner of Subject Facing West Northeast Corner of Subject Facing North
Crystal Park Public Improvement District No. 2 Improvement Area #1
81
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SUBJECT PHOTOGRAPHS
Northeast Corner of Subject Facing North Northeast Corner of Subject Facing South
CR 286 Facing North CR 286 Facing South
Crystal Park Public Improvement District No. 2 Improvement Area #1
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Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
HIGHEST AND BEST USE
The highest and best use may be defined as the most profitable or likely profitable legal use for which a property
may be utilized. The opinion of such use may be based on the highest and most profitable continuous use to which
the property is adapted and needed, or likely to be in demand in the reasonably near future. Also, that reasonable
and probable use that will support the highest present value, as defined, as of the Prospective Effective Date of
the appraisal.
Alternatively, that use, from among reasonably probable and legal alternative uses, is found to be:
a. Legally Permissible c. Financially Feasible
b. Physically Possible d. Maximally Productive
The definition, immediately above, applies specifically to the highest and best use of land. It is to be recognized
that in cases where a site has existing improvements on it, the highest and best use may very well be determined
to be different from the existing use. The existing use will continue however, unless and until land value in its
highest and best use exceeds the total value of the property in its existing use.
There are two distinct types of highest and best use, that being the highest and best use as if the site were vacant,
and the highest and best use as improved. Both use determinations require consideration of the physical, legal,
financial feasibility and maximal productivity for the site and improvements.
HIGHEST AND BEST USE ANALYSIS
Highest and Best Use “As-Vacant”
Legally Permissible
The subject property is within the City of Anna and is governed by a Development Agreement and is zoned
Planned Development (PD). The PD for the subject property (171 residential lots), allows for detached single-
family residential uses and sets forth requirements and standards for residential development for the subject
property.
No private deed restrictions were uncovered during a normal investigation, which would further limit the potential
uses of the subject site. No other legal restrictions or covenants were found to be imposed on the subject property
at the time of the appraisal, which would further restrict development.
Given surrounding land use patterns in the area, only detached single-family residential use is given further
consideration in determining the highest and best use of the site as vacant.
Physically Possible
Considering the subject’s physical characteristics including jurisdiction, location, size, shape, and availability of
utilities, the site is capable of numerous uses which are physically possible without being constrained by the
property itself.
Financially Feasible
In order to be economically feasible, the improvements should conform to the surrounding land uses. To meet the
test of being financially feasible, the project must provide a net return over a reasonable period of time. The area
surrounding the subject property is suburban and development of the surrounding area has accelerated
considerably over the past decade as development in Collin County and specifically Anna along major highways
Crystal Park Public Improvement District No. 2 Improvement Area #1
83
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
such as U.S. Highway 75 has shown almost endless demand. Developers and home builders have moved further
away from the center of the Metroplex to quasi-rural areas of Collin County. Based on review of homes on the
market, we would expect home prices in the $500,000s-$600,000s would be in demand in Crystal Park PID No.
2 IA #1.
Based on our analysis of the market, it is reasonable to expect a rise in demand for vacant developed lots (VDLs)
in 2026 as homebuilders sell more homes when mortgage rates begin to fall precipitously as they did in 2024;
Along with this, due to the lack of supply for VDLs and the long-term prospects of the subject’s area, we expect
ample demand for single-family lots in the next 2-5 years. When looking at the longer time horizon, it appears
that a newly developed single-family residential use on the site would have a value commensurate with its cost.
Therefore, single-family residential use is considered to be financially feasible.
Maximally Productive
There does not appear to be any reasonably probable use of the subject property that would generate a higher
residual land value than single-family residential use. Accordingly, it is our opinion that single-family residential
use, developed to the normal market density allowed by the Planned Development is the maximally productive
use of the property.
The resilient business climate in North Texas and the continual development of neighborhoods in Anna and Collin
County has created increased demand for homes in the area. Coupled with increasing movement into DFW, and
northeast of the Metroplex in particular, it is our opinion that the highest and best use of the property “As-Vacant”
would be for the development of single-family residential community. Thus, the highest and best use of the
property “As-Vacant” is for development of single-family residential use.
Highest and Best Use “As-Improved”
Development of the subject property, as proposed utilizing our extraordinary assumptions, is the only use that
meets the four tests of highest and best use. Therefore, we conclude that the highest and best use of the property
As-Improved” is similar to our conclusion “As-Vacant” which is for single-family residential use.
We believe that the most probable buyers would be a developer of large single-family communities or a large
homebuilder who is active in the DFW Metroplex market. Also, given that the developer of the subject property
Bloomfield Homes) is a nationally recognized developer and homebuilder, an additional most probably buyer
would be the end-user seeking affordable housing in an area such as Anna.
Crystal Park Public Improvement District No. 2 Improvement Area #1
84
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
VALUATION – IMPROVED RESIDENTIAL LOTS
Three approaches to value are typically considered when developing a market value opinion for real property.
These are the Cost Approach, the Sales Comparison Approach, and the Income (Subdivision Development)
Approach. Use of the approaches in this assignment is summarized as follows:
Approach Applicability to Subject Use in Assignment
Cost Approach Not Appropriate Since the Whole Property is
Developed in Multiple Phases
Not Utilized
Income (Subdivision
Development) Approach
Appropriate in Determining Residential
Subdivision Value
Utilized
Sales Comparison Approach Aspects Used in Subdivision Valuation to
Determine Retail Market Value of the 50-FF Lots
and the 60-FF Lots
Partially Utilized
Residential Subdivision 171 (Improved Lots)
Cost Approach
The Cost Approach provides information that contrasts with information from the Income and Sales Comparison
Approaches. It allows the appraiser to address the feasibility and highest and best use issues inherent in new
construction. This approach is most beneficial when appraising a proposed or recently built project and is
typically used when units make up a substantial portion of the entire project. Since Crystal Park PID is being
developed in multiple phases, the Cost Approach is not appropriate and thus was not utilized.
Income (Subdivision Development) Approach
The Income (Subdivision Development) Approach applied in subdivision analysis simulates what occurs in a
bulk sale where one buyer purchases a subdivision or large group of lots at a discount. Income capitalization is
the primary method used in subdivision valuation because value is determined by future sales over time. Along
with discounted cash flow analysis, income capitalization directly measures differences in present value based on
future cash flow projections. This approach provides a direct measure of the market value or wholesale value of
a group of lots or units, which is different from the sum of the retail lot prices. Since the problem to be solved in
this assignment is to determine the bulk sale value of 171 improved lots in Improvement Area #1, as of the
Prospective Effective Date of July 1, 2026, which is based on the Substantial Completion Date, the Income
Subdivision Development) Approach is appropriate and was fully developed.
Sales Comparison Approach
The Sales Comparison Approach involves comparing recent sales of entire subdivisions or a large group of lots
values for the subdivision or the group of lots is the objective of the analysis, and that determination requires
recent and relevant similar bulk sales for the comparison. Finding highly similar and recent sales of improved
subdivisions to a single buyer in most markets can be difficult, perhaps impossible. Comparison requires
comparable sales with about the same or similar remaining absorption period, a similar mix of lots or unit types,
location, home price points, and other characteristics. As Texas is a non-disclosure state, the sales data available
is limited to sales confirmed by associated parties. Since data on highly similar bulk sales to a single purchaser
is difficult to find and verify, the Sales Comparison Approach was not fully developed by the appraisers.Aspects
of the Sales Comparison Approach were utilized to determine the retail value of the improved lots for analysis
within the Income (Subdivision Development) Approach.
Crystal Park Public Improvement District No. 2 Improvement Area #1
85
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
INCOME (SUBDIVISION DEVELOPMENT) APPROACH - IMPROVED RESIDENTIAL LOTS
Income capitalization is the primary method used in subdivision valuation because value is determined by future sales
over time. Along with discounted cash flow analysis, income capitalization directly measures differences in present
value based on future cash flow projections. The income methodology applied in subdivision analysis has been adapted
to simulate what occurs in a bulk sale where one buyer purchases a group of lots at a discount. It provides a direct
measure of the market value or wholesale value of a group of lots or units, which is different from the sum of the retail
lot prices.
In order to complete the analysis, the appraisers:
Determined the value of the lots through aspects of the Sales Comparison Approach based on the concept plan
provided by the developers
Calculated the absorption period (earlier in the report) for the finished lots after construction is complete
Analyzed the effect of appreciation, taxes, and sales costs over the absorption period
Estimated the appropriate discount rate necessary to undertake the risks associated with the project
Utilized discount cash flow (DCF) analysis to determine the present value of future cash flows realized by
selling the lots at market prices over time
We utilized the following unit of comparison, which is the measure most commonly found in the market:
Sales Price Per Front Foot – Obtained by dividing sale price by the front footage of the lot
Following is our analysis of the 50-FF lots within Crystal Park PID No. 2 IA #1.
Crystal Park Public Improvement District No. 2 Improvement Area #1
86
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
MAP OF COMPARABLE LOT SALES –50’ LOTS
Subject: Crystal Park PID No. 2 IA #1, Anna, TX 75409
We selected the best and most recent comparable lot sales for our analysis of the 50-FF lots. Our five comparable
sales are shown below:
Sale Subdivision/Address City ISD
Contract
Date Sale Date
Base
Lot Price
Front
Feet (FF)$/FF
1 Mosaic Celina Prosper Sept - 2023 Closed $115,000 50 $ 2,300
2 Cambridge Crossing Celina Celina Jan-2024 In-Contract $100,000 50 $ 2,000
3 Hillside Village Celina Celina Jan-2023 In-Contract $97,250 50 $ 1,945
4 Shaded Tree (Proposed) McKinney McKinney Aug-2023 In-Contract $93,960 50 $ 1,879
5 Villages at Uptown Celina Celina Jan-2024 Closed $95,000 50 $ 1,900
Subject Crystal Park PID No. 2 IA #1 Anna Anna - - - 50 -
SUMMARY OF LOT SALES - 50' LOTS
Crystal Park Public Improvement District No. 2 Improvement Area #1
87
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 1 – 50’ LOTS
Comparable 1 Aerial Comparable 1 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 6,000 SF 0.14 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
19.17
2,300
Denton
50-FF Sale Comparable 1
Mosaic
Residential Lot
Southwest corner of Frontier Parkway and
Legacy Drive, Celina
115,000
Residential / Multiple Units
Planned Development
Rectangular
Basically level
All available
Closed
September - 2023
Tellus Texas I LLC
Highland Homes - Dallas LLC
Crystal Park Public Improvement District No. 2 Improvement Area #1
88
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 2 – 50’ LOTS
Comparable 2 Aerial Comparable 2 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 6,000 SF 0.14 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
Basically level
All available
In-Contract
January-2024
Tollway/Outer Loop LP
Perry Homes
100,000
16.67
2,000
Rectangular
50-FF Sale Comparable 2
Cambridge Crossing
Residential Lot
North side of Punk Carter Parkway and
West of Huddleston Drive, Celina
Collin
Residential / Multiple Units
Planned Development
Crystal Park Public Improvement District No. 2 Improvement Area #1
89
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 3 – 50’ LOTS
Comparable 3 Aerial Comparable 3 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 6,000 SF 0.14 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
January-2023
Wayne/Jackson, Inc.
MHI (Coventry Homes)
97,250
16.21
1,945
In-Contract
Hillside Village
Residential Lot
Northeast quadrant of Glendenning
Parkway and County Road 89, Celina
Collin
Residential / Multiple Units
Planned Development
Rectangular
Basically level
All available
50-FF Sale Comparable 3
Crystal Park Public Improvement District No. 2 Improvement Area #1
90
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 4 – 50’ LOTS
Comparable 4 Aerial Comparable 4 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 6,000 SF 0.14 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
15.66
1,879
93,960
Residential / Multiple Units
Planned Development
Rectangular
Basically level
All available
In-Contract
Aug-2023
TCL Land Bk 4 )2022), LP
Lennar Homes of Texas Land &
Construction LTD
Collin
50-FF Sale Comparable 4
Shaded Tree (Proposed)
Residential Lot
Southeast corner of FM-543 (Weston
Road) and CR-202, McKinney
Crystal Park Public Improvement District No. 2 Improvement Area #1
91
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 5 – 50’ LOTS
Comparable 5 Aerial Comparable 5 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 6,050 SF 0.14 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
Perry Homes
95,000
15.70
1,900
Basically level
All available
Closed
January - 2024
Uptown Celina Partners LP
Rectangular
50-FF Sale Comparable 5
Villages at Uptown
Residential Lot
South of FM 57, North of FM 455, West of
North Louisiana Drive, and East of FM 455,
Celina
Collin
Residential / Multiple Units
Planned Development
Crystal Park Public Improvement District No. 2 Improvement Area #1
92
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALES ADJUSTMENT COMPARISON GRID –50’ LOTS
Subject Sale 1 Sale 2 Sale 3 Sale 4 Sale 5
Subdivision
Crystal Park PID No.
2 IA #1
Mosaic
Cambridge
Crossing
Hillside
Village
Shaded Tree
Proposed)
Villages at
Uptown
Anna Celina Celina Celina McKinney Celina
Transactional Adjustments
Sales Price/FF $2,300 $2,000 $1,945 $1,879 $1,900
Rights Conveyed 0% 0% 0% 0% 0%
Sales Price/FF $2,300 $2,000 $1,945 $1,879 $1,900
Financing Terms 0% 0% 0% 0% 0%
Sales Price/FF $2,300 $2,000 $1,945 $1,879 $1,900
Conditions of Sale 0% 0% 0% 0% 0%
Sales Price/FF $2,300 $2,000 $1,945 $1,879 $1,900
Expenditures After Purchase 0% 0% 0% 0% 0%
Sales Price/FF $2,300 $2,000 $1,945 $1,879 $1,900
Time/Market Conditions +9% +8% +11% +9% +8%
ADJUSTED Price/FF:$2,507 $2,160 $2,159 $2,048 $2,052
Location/Access
West of U.S. Highway
75 and south of Farm-to-
Market 455
4% -3% -3% -4% -3%
Amenities
2.3 acre crystal lagoon
with a Flow Rider surf
simulator, a swim-up
bar, kids' play areas, and
water slides
2% -2% +2% +2% +2%
Size 50-FF 0% 0% 0% 0% 0%
Topography/View
Gently Sloping;
Unshaded Zone X
0% 0% 0% 0% 0%
Zoning Planned Development 0% 0% 0% 0% 0%
2% -5% -1% -2% -1%
2,457 $2,052 $2,137 $2,007 $2,031
Value Range/FF $2,007 to $2,457
Average Value/FF
Median Value/FF
Size
Unit Value Indication
Overall Value Indication
Rounded
2,052
2,137
2135/FF
50-FF
106,750
106,750
Physical Adjustments
Total Net Physical Adj. After Transactional Adj.
ADJUSTED Price/FF:
SUMMARY OF COMPARABLE VALUES
Crystal Park Public Improvement District No. 2 Improvement Area #1
93
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
ANALYSIS OF ADJUSTMENTS –50’ LOTS
Our research of comparable lot sales leads us to the determination that there are ample recent transactions within
the last few years involving similar properties within the subject’s general competing area that could reliably and
reasonably be verified through our due diligence. The comparable sales for the subject property had unadjusted
contracted base prices ranging from $1,879 per front foot to $2,300 per front foot (FF) with all Sales being 50-FF
lot types.
Data on each of the sales, including sales price, was confirmed with sources considered reliable. Based on analysis
of this data and other pertinent information obtained in our research, the following pages are a discussion of the
factors which were found to exhibit significant influence on property values in this market.
Factors to be Considered and Summary of Adjustments
Transactional Adjustments
Property Rights, Financing Terms, and Conditions of Sale
Each of the comparable sales were sold as Fee Simple interests, sales were transferred in cash equivalency, and
under typical sale conditions; thus, no adjustments are made for these three factors.
Expenditures After Purchase
Typically, in a master-planned residential community like the subject, municipalities will require impact fees paid
for water, sewer, and roadway. These fees will be the responsibility of the homebuilder rather than the developer.
Since purchasers of other lots would typically be expected to pay water, sewer, and roadway impact/connection
fees, these are not considered atypical and are not included in our analysis.
Time/Market Conditions
The residential real estate market increased significantly in 2020-2024 but now appears to be cooling following
another interest rate increased by the Federal Reserve that has lowered mortgage rates by 5 basis points to 6.72%
as of July 2025. Price increased from 2020-2024 occurred in improved residential homes as well as in vacant
developed lots as there was strong demand for lots and new homes. Homebuilders absorbed lots well above the
historical norm during this period. We also considered that according to data from Zonda there is a shortage of
50-FF vacant developed lots in this market which has driven prices higher even as demand for finished homes
has recently diminished.
Considering the residential market data and price increases for recent platted and developed residential lot sales
throughout the Metroplex and specifically within Collin County which were necessitated based off supply and
demand as well as development costs, we believe a market conditions adjustment of +3% year-over year (YoY)
increase from the contract date to substantial completion is warranted and supported for residential developed lots
for sale in platted subdivisions, due to the time it takes to get all the city entitlements approved and engineer and
zoning costs paid. Platted developed lots on the ground have a faster market sale value increase than would raw
land sold for this use. Based on the preceding, each of the comparable lot sales have been adjusted positively
between +8% and +11% for Market Conditions depending on the sale date.
Crystal Park Public Improvement District No. 2 Improvement Area #1
94
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Physical Adjustments
Location/Access
The subject property is in a quickly developing area of North Texas in the City of Anna. Development in the
subject’s area has been increasing and consistent throughout the decades. The subject is located just west of U.S.
Highway 75 and south of FM 455. The area around the subject is primarily agricultural land with single family
dwellings. Also, in the area there are municipal and commercial uses along Texas State Highway 75.
Northeast of the subject property, about 6 miles, is Anna High School which is the only high school in Anna ISD.
Anna ISD has a “C” rating from the Texas Education Agency (TEA). Many future residents looking for a quasi-
rural residential neighborhood would prefer a smaller and desirable school district than larger school districts
more prevalent near DFW. Accessibility is considered average for this area. We have made the following
adjustments for Location/Access:
Sale 1: Superior; Located in Celina, which has superior access to commercial uses, and is located in
Prosper ISD which has an “A” rating and is a superior ISD compared to the subject; Adjusted -4%
Sale 2: Superior; Located in Celina, which has superior access to commercial uses, and is located in Celina
ISD which has a “B” rating and is a superior ISD compared to the subject; Adjusted -3%
Sale 3: Superior; Located in Celina which has superior access to commercial uses, and is located in Celina
ISD which has a “B” rating and is a superior ISD compared to the subject; Adjusted -3%
Sale 4: Superior; Located in McKinney, which has superior access to commercial uses, and is located in
McKinney ISD which has a “B” rating and is a superior ISD compared to the subject; Adjusted -4%
Sale 5: Superior; Located in Celina, which has superior access to commercial uses, and is located in Celina
ISD which has a “B” rating and is a superior ISD compared to the subject; Adjusted -3%
Amenities
The subject property’s amenities will consist of a 2.3-acre crystal lagoon with a surf simulator, a swim-up bar,
kids' play areas, and water slides. According to the site visit, the earthwork on the site is underway. The subject’s
amenities are standard for a master planned community the size of Crystal Park PID No. 2 IA #1 with development
being built-out with 171 homes. We have made the following adjustments for Amenities:
Sale 1: Inferior; Mosaic Subdivision, which has inferior amenities such as an amenity center, lazy river,
lake, trails, and greenspace; Adjusted +2%
Sale 2: Superior; Cambridge Crossing Subdivision which has superior amenities such as an amenity
center, fitness center, pickleball courts, sport courts, jogging trails, fishing pond, playground, pools,
cabanas, and an event lawn; Adjusted -2%
Sale 3: Inferior; Hillside Village Subdivision, which has inferior amenities such as a resort style pool,
cabanas, jogging trails, a playground, and a park; Adjusted +2%
Sale 4: Inferior; Shaded Tree (Proposed) Subdivision, which has inferior amenities such as common areas,
and a park; Adjusted +2%
Sale 5: Inferior; Villages at Uptown Subdivision, which has inferior amenities such as a club house, pool,
jogging path/bike path, park, dog park, greenbelt; Adjusted +2%
Crystal Park Public Improvement District No. 2 Improvement Area #1
95
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Size
Due to economies of scale, smaller lots are expected to sell for a higher price per unit (foot frontage). All Sales
are also 50’ lots that can accommodate the same building pad, so no adjustment is made for Size.
Topography/View
The subject and the comparable sales will each be located on graded and improved land tracts that have been
optimized for layout, drainage, and utility access so no adjustment is needed for Topography. Additionally, each
of the comparable sales are located on recently developed former agricultural land that lacks remarkable views
due to the basically level topography; thus, there is no adjustment needed for View.
Zoning
The subject property is in a planned development, and all comparable sales are in planned developments with
residential subdivision zoning for similar sized residential lots; thus, no adjustment is made for Zoning.
Value Conclusion for 50’ Lots
The 50’ Lot Sales have an adjusted range of $2,007/FF to $2,457/FF with an average of $2,137/FF and a median
of $2,052/FF. We considered each of the five sales as being reflective of the market and considered increasing
development land costs due to increases in material and labor, which has increased the cost to develop a property
similar to the subject. We conclude that the retail market value of the improved 50’ lots is $2135/FF, or
106,750/Lot.
Lot Type Total Lots
Projected
Completion Date
Concluded Retail
Value Per Lot
50' Detached Lots 123 July 1, 2026 $106,750
Next, we will analyze the retail market value of the 60’ improved residential lots within Crystal Park PID No. 2
IA #1.
Crystal Park Public Improvement District No. 2 Improvement Area #1
96
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
MAP OF COMPARABLE LOT SALES –60’ LOTS
Subject: Crystal Park PID No. 2 IA #1, Anna, TX 75409.
We selected the best and most recent comparable lot sales for our analysis of the 60-FF lots. Our five comparable
sales are shown below:
Sale Subdivision/Address City ISD
Contract
Date Sale Date
Base
Lot Price
Front
Feet (FF)$/FF
1 Brookhollow West Prosper Prosper Jun-2023 Jun-2023 $138,000 60 $ 2,300
2 Hillside Village Celina Celina Jan-2023 In-Contract $114,000 60 $ 1,900
3 Bryson Ranch Pilot Point Pilot Point Mar-2024 In-Contract $108,000 60 $ 1,800
4 Cambridge Crossing Celina Celina Feb-2024 Closed $120,000 60 $ 2,000
5 Maverick Farms Pilot Point Pilot Point May-2025 In-Contract $114,000 60 $ 1,900
Subject Crystal Park PID No. 2 IA #1 Anna Anna - - - 60 -
SUMMARY OF LOT SALES - 60' LOTS
Crystal Park Public Improvement District No. 2 Improvement Area #1
97
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 1 – 60’ LOTS
Comparable 1 Aerial Comparable 1 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 7,800 SF 0.18 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
Collin
60-FF Sale Comparable 1
Brookhollow West
Residential Lot
West side of Lakewood Drive, South side
of First Street, North side of US Highway
380, East side of Coit Road, Prosper
138,000
Residential / Multiple Units
Planned Development
Rectangular
Basically level
All available
Closed
Jun-2023
Tollway/Outer Loop LP
Highland Homes - Dallas, LLC
17.69
2,300
Crystal Park Public Improvement District No. 2 Improvement Area #1
98
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 2 – 60’ LOTS
Comparable 2 Aerial Comparable 2 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 7,200 SF 0.17 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
Rectangular
60-FF Sale Comparable 2
Hillside Village
Residential Lot
Northeast quadrant of Glendenning
Parkway and County Road 89, Celina
Collin
Residential / Multiple Units
Planned Development
Basically level
All Avaliable
In-Contract
January-2023
Wayne/Jackson, Inc.
Shaddock Homes
114,000
15.83
1,900
Crystal Park Public Improvement District No. 2 Improvement Area #1
99
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 3 – 60’ LOTS
Comparable 3 Aerial Comparable 3 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 7,200 SF 0.17 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
60-FF Sale Comparable 3
In-Contract
Bryson Ranch
Residential Lot
Northwest Quadrant of Moberly Road
and Hames Road, Pilot Point
Denton
Residential / Multiple Units
Planned Development
Rectangular
Basically level
All available
March - 2024
Centurion American Acqusitions, LLC
Ashton Dallas Residential, LLC
108,000
15.00
1,800
Crystal Park Public Improvement District No. 2 Improvement Area #1
100
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 4 – 60’ LOTS
Comparable 4 Aerial Comparable 4 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 7,800 SF 0.18 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
Collin
60-FF Sale Comparable 4
Cambridge Crossing
Residential Lot
Northeast quadrant of Legacy Drive and
Punk Carter Parkway, Celina
120,000
Residential / Multiple Units
Planned Development
Rectangular
Basically level
All available
Closed
February - 2024
Tollway/Outerloop LP
UnionMain Homes LLC
15.38
2,000
Crystal Park Public Improvement District No. 2 Improvement Area #1
101
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALE COMPARABLE 5 – 60’ LOTS
Comparable 5 Aerial Comparable 5 Map
Property Information
Subdivision Name
Property Class
Address
County
Property Type
Site Information
Site Size 7,200 SF 0.17 Acres
Zoning Code
Shape
Topography
Available Utilities
Transaction Information
Sale Status
Sale/Contract Date
Seller
Buyer
Sale Price
Price per SF Land
Price per Front Foot
Rectangular
60-FF Sale Comparable 5
Maverick Farms
Residential Lot
North of Mustang Road and South of Joe
Allen Road, Pilot Point
Denton
Residential / Multiple Units
Planned Development
UnionMain Homes, LLC
114,000
15.83
1,900
Basically level
All available
In-Contract
May - 2025
OMA Pilot Point, LLC
Crystal Park Public Improvement District No. 2 Improvement Area #1
102
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
SALES ADJUSTMENT COMPARISON GRID –60’ LOTS
Subject Sale 1 Sale 2 Sale 3 Sale 4 Sale 5
Subdivision
Crystal Park PID
No. 2 IA #1
Brookhollo
w West
Hillside
Village
Bryson
Ranch
Cambridge
Crossing
Maverick
Farms
Anna Prosper Celina Pilot Point Celina Pilot Point
Transactional Adjustments
Sales Price/FF $2,300 $1,900 $1,800 $2,000 $1,900
Rights Conveyed 0% 0% 0% 0% 0%
Sales Price/FF $2,300 $1,900 $1,800 $2,000 $1,900
Financing Terms 0% 0% 0% 0% 0%
Sales Price/FF $2,300 $1,900 $1,800 $2,000 $1,900
Conditions of Sale 0% 0% 0% 0% 0%
Sales Price/FF $2,300 $1,900 $1,800 $2,000 $1,900
Expenditures After Purchase 0% 0% 0% 0% 0%
Sales Price/FF $2,300 $1,900 $1,800 $2,000 $1,900
Time/Market Conditions +9% +11% +7% +7% +4%
ADJUSTED Price/FF:$2,507 $2,109 $1,926 $2,140 $1,976
Location/Access
West of U.S. Highway
75 and south of Farm-
to-Market 455
4% -3% +2% -3% +2%
Amenities
2.3 acre crystal lagoon
with a Flow Rider surf
simulator, a swim-up
bar, kids' play areas,
and water slides
2% +2% 0% -2% 0%
Size 60-FF 0% 0% 0% 0% 0%
Zoning Planned Development 0% 0% -2% 0% 0%
2% -1% 0% -5% +2%
2,457 $2,088 $1,926 $2,033 $2,016
Value Range/FF $1,926 to $2,457
Average Value/FF
Median Value/FF
Size
Unit Value Indication
Overall Value Indication
Rounded
Physical Adjustments
Total Net Physical Adj. After Transactional Adj.
ADJUSTED Price/FF:
2,104
2,033
60-FF
2100/FF
126,000
126,000
SUMMARY OF COMPARABLE VALUES
Crystal Park Public Improvement District No. 2 Improvement Area #1
103
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
ANALYSIS OF ADJUSTMENTS –60’ LOTS
Our research of comparable lot sales leads us to the determination that there are ample recent transactions within
the last few years involving similar properties within the subject’s general competing area that could reliably and
reasonably be verified through our due diligence. The comparable sales for the subject property had unadjusted
contracted base prices ranging from $1,800 per front foot to $2,300 per front foot (FF) with all sales being 60-FF
lot type.
Data on each of the sales, including sales price, was confirmed with sources considered reliable. Based on analysis
of this data and other pertinent information obtained in our research, the following pages are a discussion of the
factors which were found to exhibit significant influence on property values in this market.
Factors to be Considered and Summary of Adjustments
Transactional Adjustments
Property Rights, Financing Terms, and Conditions of Sale
Each of the comparable sales were sold as Fee Simple interests, sales were transferred in cash equivalency, and
under typical sale conditions; thus, no adjustments are made for these three factors.
Expenditures After Purchase
Typically, in a master-planned residential community like the subject, municipalities will require impact fees paid
for water, sewer, and roadway. These fees will be the responsibility of the homebuilder rather than the developer.
Since purchasers of other lots would typically be expected to pay water, sewer, and roadway impact/connection
fees, these are not considered atypical and are not included in our analysis.
Time/Market Conditions
The residential real estate market increased significantly in 2020-2024 but now appears to be cooling following
another interest rate increased by the Federal Reserve that has lowered mortgage rates by 5 basis points to 6.72%
as of July 2025. Price increased from 2020-2024 occurred in improved residential homes as well as in vacant
developed lots as there was strong demand for lots and new homes. Homebuilders absorbed lots well above the
historical norm during this period. We also considered that according to data from Zonda there is a shortage of
60-FF vacant developed lots in this market which has driven prices higher even as demand for finished homes
has recently diminished.
Considering the residential market data and price increases for recent platted and developed residential lot sales
throughout the Metroplex and specifically within Collin County which were necessitated based off supply and
demand as well as development costs, we believe a market conditions adjustment of +3% year-over year (YoY)
increase throughout 2023, 2024, and into the second quarter of 2025 is warranted and supported for residential
developed lots for sale in platted subdivisions, due to the time it takes to get all the city entitlements approved
and engineer and zoning costs paid. Platted developed lots on the ground have a faster market sale value increase
than would raw land sold for this use. Based on the preceding, each of the comparable lot sales have been adjusted
positively between +4% and +11% for Market Conditions depending on the sale date.
Crystal Park Public Improvement District No. 2 Improvement Area #1
104
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Physical Adjustments
Location/Access
The subject property is in a quickly developing area of North Texas in the City of Anna. Development in the
subject’s area has been increasing and consistent throughout the decades. The subject is located just west of Texas
State Highway 75 and south of FM 455. The area around the subject is primarily agricultural land with single
family dwellings. Also, in the area there are municipal and commercial uses along Texas State Highway 75.
Northeast of the subject property, about 6 miles, is Anna High School which is the only high school in Anna ISD.
Anna ISD has a “C” rating from the Texas Education Agency (TEA). Many future residents looking for a quasi-
rural residential neighborhood would prefer a smaller and desirable school district than larger school districts
more prevalent near DFW. Accessibility is considered average for this area. We have made the following
adjustments for Location/Access:
Sale 1: Superior; Located in Prosper, which has superior access to commercial uses, and is located in
Prosper ISD which has an “A” rating and is a superior ISD compared to the subject; Adjusted -4%
Sale 2: Superior; Located in Celina, which has superior access to commercial uses, and it is located in
Celina ISD which has a “B” rating and is a superior ISD compared to the subject; Adjusted -3%
Sale 3: Inferior; Located in Pilot Point, which feeds into the Pilot Point ISD which has a “C” rating and
considered to be a similar ISD, however, it has inferior access to commercial uses; Adjusted +2%
Sale 4: Superior; Located in Celina, which has superior access to commercial uses, and is located in Celina
ISD which has a “B” rating which is a superior ISD compared to the subject; Adjusted -3%
Sale 5: Inferior; Located in Pilot Point, which feeds into the Pilot Point ISD which has a “C” rating and
considered to be a similar ISD, however it has inferior access to commercial uses; Adjusted +2%
Amenities
The subject property’s amenities will consist an 2.3-acre crystal lagoon with a surf simulator, a swim-up bar, kids'
play areas, and water slides. According to the site visit, the earthwork on the site is underway. The subject’s
amenities are standard for a master planned community the size of Crystal Park PID No. 2 IA #1 with development
being built-out with 171 homes. We have made the following adjustments for Amenities:
Sale 1: Inferior; Brookhollow West Subdivision, which has inferior amenities such as a club house, pool,
jogging path/bike path, park; Adjusted +2%
Sale 2: Inferior; Hillside Village Subdivision which has inferior amenities such as a resort style pool,
cabanas, jogging trails, a playground, and a park; Adjusted +2%
Sale 3: Similar; Bryson Ranch Subdivision which has similar amenities such as commercial space,
amenity centers, pool, playground, fitness center, trails, open spaces; Adjusted 0%
Sale 4: Superior; Cambridge Crossing Subdivision, which has superior amenities such seven lakes, private
amenity center, fitness center, pickleball courts, half-court basketball, jogging trails, fishing pond,
playground, lap pool, resort pool/cabanas, event lawn; Adjusted -2%
Sale 5: Similar; Maverick Farms Subdivision, which has similar amenities such as an amenity building,
pool, outdoor fitness area, playground, grilling station, pavilion, cabanas, lake with a dock, trails,
greenspace; Adjusted 0%
Crystal Park Public Improvement District No. 2 Improvement Area #1
105
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Size
Due to economies of scale, smaller lots are expected to sell for a higher price per unit (foot frontage). The converse
also tends to be true. All sales are also 60’ lots that can accommodate the same building pad, so no adjustment is
made for Size to those comparable sales.
Zoning
The subject property is in a planned development and comparable sales 1, 2, 3, 4, and 5 are in planned
developments with residential subdivision zoning for similar sized residential lots; thus, no adjustment is made
for Zoning.
Value Conclusion for 60’ Lots
The 60’ Lot Sales have an adjusted range of $1,926/FF to $2,457/FF with an average of $2,104/FF and a median
of $2,033/FF. We considered each of the five sales as being reflective of the market and considered increasing
development land costs due to increases in material and labor, which has increased the cost to develop a property
similar to the subject. We conclude that the retail market value of the improved 60’ lots is $2100/FF, or
126,000/Lot.
Lot Type Total Lots
Projected
Completion Date
Concluded Retail
Value Per Lot
60' Detached Lots 48 July 1, 2026 $126,000
Crystal Park Public Improvement District No. 2 Improvement Area #1
106
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Cumulative Retail Lot Value
We believe a current lot market value of $2135/FF for 50’ improved Lots and $2100/FF for 60’ improved Lots
with a Prospective Effective Date of July 1, 2026 is accurate and well-supported. Not only do our compiled recent
comparable lot sales indicate those prices, but numerous conversations with market participants – land developers
and homebuilders – regarding current prices of lots within the subject’s market indicate that our concluded values
per front foot is supported by the current retail price for 50-FF and 60-FF lots similar to the subject property.
Market participants noted that prices for lots rose significantly in late 2020 and throughout 2024 which followed
a spike in the residential housing market in DFW that contributed to a scarcity of vacant developed lots for
homebuilders.
As of the Prospective Effective Date of July 1, 2026, the retail market value of the 50-FF and 60-FF lot prices for
Crystal Park PID No. 2 IA #1 are shown below:
Total
Lots
Feet Frontage
FF)
Retail
Price/Lot Effective Date
Price/FF
FF)
Total Retail
Value ($)
123 50 FF $106,750 July 1, 2026 $2135/FF $13,130,250
48 60 FF $126,000 July 1, 2026 $2100/FF $6,048,000
171 $19,178,250
CRYSTAL PARK PID No. 2 IA #1
Next, we will develop an opinion of value for the 171 residential lots using the Discount Cash Flow analysis.
Crystal Park Public Improvement District No. 2 Improvement Area #1
107
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
DISCOUNT CASH FLOW ANALYSIS
Having completed the retail lot value conclusions using aspects of the Sales Comparison Approach, we will
develop an opinion of the market value of the property to a single purchaser, as of the substantial completion date.
This value will include a provision for compensating the developer, i.e., profit for risk and expenditure of time.
This value contemplates that the developer of the subject property would sell the subject to another developer
who would in turn sell the developed lots on a retail basis. This value represents the concept of market value to a
single purchaser as of the substantial completion date, wherein a portion of the overall real property rights or
physical asset would typically be sold to its ultimate users over some future period. Valuations involving such
properties must fully reflect all appropriate deductions and discounts as well as the anticipated cash flows to be
derived from the disposition of the asset over time. Appropriate deductions and discounts are those which reflect
all expenses associated with the disposition of the property as well as the cost of capital and entrepreneurial profit.
This latter item of entrepreneurial profit is accounted for herein as part of the discount rate.
The various assumptions necessary to complete our Discounted Cash Flow (DCF) analysis for the developed
subject subdivision are discussed in detail in the following paragraphs.
Absorption
As discussed in detail in the “Absorption Analysis” section of the report, our quarterly absorption projections are
summarized as follows for the subject property:
ABSORPTION SCHEDULE FOR CRYSTAL PARK PID NO. 2 IA #1
Note: Typically, quarters start in January, April, July, and October so we have used those baselines in our
analysis. Since the Effective Date is July 1, 2026, our analysis starts on the 3rd quarter of 2026.
Value Increases During Absorption Period
Historically, in the sales contracts of volume lot sales in the marketplace, the lot prices are typically adjusted
upward at rates ranging from the Wall Street Journal prime rate (7.50% as of August 2025), plus 1% (annually)
up to 8.5%. Contracts between land developers and homebuilders typically have a 6% escalation which is
consistent with recent improved lot appreciations over many years. Thus, for valuation purposes moving forward,
we have estimated an annual appreciation on the subject’s lots at 6% per year which is also consistent with
residential real estate appreciation over the past decade. This is also considered reasonable given the lack of
available lot and housing supply in the area and the historical realization of interest carry/appreciation by
developers within DFW and surrounding market areas.
Lot Type Jul-2026 Oct-2026 Jan-2027 Apr-2027 Jul-2027 Oct-2027 Jan-2028 Apr-2028 Jul-2028 Oct-2028 Jan-2029 TOTAL
50-FF 12 12 12 12 12 12 12 12 12 12 3 123
60-FF 6 6 6 6 6 6 6 6 - - -48
Total 18 18 18 18 18 18 18 18 12 12 3 171
Projected Quarterly Absorption Summary - Crystal Park PID No. 2 IA #1
Crystal Park Public Improvement District No. 2 Improvement Area #1
108
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
EXPENSES
Taxes are paid by the developer annually. The estimation of taxes paid per period is based upon the principle that
taxes are prorated at closing and are paid in arrears. Therefore, we have deducted taxes based upon the estimated
retail market value of the unsold lots. The taxes are prorated in each calendar year based upon the projected sales
in each period. The current tax rate for the bulk of the property is 0.01995536 per $100 assessed – 1.995536%
or the purpose of our analysis – with taxes due to the City of Anna, Collin County, Collin College, and Anna ISD.
Based upon our experience as property tax consultants and information gathered from builders/developers, we do
not believe the vacant lots will be assessed for their full market value once Substantial Completion is achieved.
We believe the builder will have their lots assessed at approximately 70% of the market value, i.e., if a lot has a
retail value of $100,000 then the assessed value will be $70,000. We believe this 30% discount is justified as
taxing districts do not typically have access to cost data and assessments typically lag the market. In addition,
many taxing districts allow for a 20% builder’s inventory reduction.
Cost of Sales has been estimated at 1.5% of gross sales proceeds for various closing costs, surveys, commissions,
and title policies.
Marketing expenses are not included as there is a shortage of vacant developed lots on the market, and we would
expect these lots to be absorbed by volume builders.
Discount Rate
The discount rate utilized herein is essentially an anticipated Internal Rate of Return (IRR) for the subject
property, as estimated from investment performance realized by market participants. The discount rate used for
the subject should be less than the typical land development project because the value we are determining is for
a fully entitled project in a city-approved Planned Development which has less risk exposure than that of raw land
development. Therefore, it is appropriate to utilize a discount rate adjusted for this risk. The appraisers have
included a recent discount rate survey published by Realty Rates that considers the market conditions, risk,
entrepreneurial profit, and liquidity inherent in a project such as the subject that developers of similar properties
would consider.
Crystal Park Public Improvement District No. 2 Improvement Area #1
109
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
As shown, the minimum actual rates in Texas range from 15.64% for less than 100 units; 16.03% for 100 to 500
units; and 16.42% for 500+ units with minimum proforma rates ranging from 15.01% to 15.76%.
The 7th Edition of the Dictionary of Real Estate Appraisal defines this term as “a discount rate that is adjusted to
offset one or more risk factors, i.e., when a future downswing in the business cycle is likely, the risk associated
with a project may increase near the end of its term, necessitating a special adjustment to the discount rate. Such
discount rates include all of the elements of risk associated with an income stream for a specified period adjusted
to offset additional term risk.” Thus, it is our opinion that a potential purchaser would expect to receive a much
lower return on his investment for a completed project similar to the subject, which has numerous purchasers of
the end product relative to that of a vacant tract of land awaiting eventual development (higher risk of escalating
costs to site development and of the eventual timing of completion).
Based upon the preceding, an internal rate of return (IRR) that is similar to the minimum actual rates provided by
the Realty Rates “Developer Survey” for Texas of 16.03% for 100-500 units; and 15.39% for likewise minimum
pro-forma rates is considered reasonable for the subject. Hence, taking into consideration the supply and demand
levels within the subject’s submarket area, we have selected a discount rate of 16% for the subject which takes
into consideration the degree of risk, developer profit, and the liquidity inherent in a project such as the subject
assisted by involvement of the PID), as well as the current market conditions. To be consistent with the timing
of the cash flows, the annual income stream is discounted quarterly with an annual DCF also included. With each
of the required elements now identified, we will analyze the subject in DCF analyses as shown on the following
pages.
Crystal Park Public Improvement District No. 2 Improvement Area #1
110
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
DISCOUNT CASH FLOW (DCF) ANALYSIS - CRYSTAL PARK PID NO. 2 IA #1
The following assumptions are made in our analysis which are supported by other research and analysis found
earlier in this report:
Substantial Complete July 1, 2026
Retail lot values: $106,750 for 50-FF lots
Retail lot values: $126,000 for 60-FF lots
6% Appreciation/Year (1.5%/Quarter)
50-FF Lots sell at 12/Quarter starting 3Q2026
60-FF Lots sell at 6/Quarter starting 3Q2026
Discount Rate 16% (4.00%/Quarter)
Tax Expense On Inventory (1.995536%/Year; 0.1662947%/Month); 30% Discount
Sales and Marketing Expense (1.5% of Revenue)
As Substantial Completion on the improved lots is expected to be completed as of July 1, 2026, we believe lot
prices will continue to appreciate close to the purchase and sale contract appreciation which is 8% per year. Thus,
we have concluded that current retail improved lot values will be similar when absorption begins. Therefore, as
of the expected Substantial Completion Date (July 1, 2026) the retail lot value for the 123 50-FF lots is
13,130,250 and for the 60-FF lots is $6,048,000 with a total cumulative value of $19,178,250 as shown in
the following table.
Total
Lots
Feet Frontage
FF)
Retail
Price/Lot Effective Date
Price/FF
FF)
Total Retail
Value ($)
123 50 FF $106,750 July 1, 2026 $2135/FF $13,130,250
48 60 FF $126,000 July 1, 2026 $2100/FF $6,048,000
171 $19,178,250
CRYSTAL PARK PID No. 2 IA #1
Discount cash flow analysis was completed on a quarterly and annual basis as a check for reasonableness. The
annual DCF is a more rudimentary calculation, and we consider the quarterly analysis to be more accurate. When
applying the DCF on a quarterly basis, the discount rate is divided by 4 and a discount rate of 4% is applied to
each period. Typically, quarters start in January, April, July, and October so we have used those baselines in our
analysis. Since the Substantial Completion Date is July 1, 2026, we will analyze on a quarterly basis starting July
2026.
Crystal Park Public Improvement District No. 2 Improvement Area #1
111
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
DISCOUNT CASH FLOW DATA – CRYSTAL PARK PID NO. 2 IA #1 (QUARTERLY)
Lot Type Starting Units Lot Price Sales Units Available Lot Price Sales Units Available Lot Price Sales
50-FF Lots 123 $ 106,750 12 111 108,351$ 12 99 109,977$ 12
60-FF Lots 48 126,000$ 6 42 127,890$ 6 36 129,808$ 6
Revenue 2,037,000$ 2,067,555$ 2,098,568$
Tax Expense (66,974)$ (60,758)$ (54,341)$
Sales Expense (30,555)$ (31,013)$ (31,479)$
Net Income 1,939,471$ 1,975,783$ 2,012,749$
Factor 0.981619 0.945863 0.911410
Income Net Present Value (NPV) 1,903,821$ 1,868,820$ 1,834,439$
Jul-2026 Oct-2026 Jan-2027
Lot Type Units Available Lot Price Sales Units Available Lot Price Sales Units Available Lot Price Sales
50-FF Lots 87 111,626$ 12 75 113,301$ 12 63 115,000$ 12
60-FF Lots 30 131,755$ 6 24 133,732$ 6 18 135,738$ 6
Revenue 2,130,047$ 2,161,998$ 2,194,428$
Tax Expense (47,718)$ (40,883)$ (33,833)$
Sales Expense (31,951)$ (32,430)$ (32,916)$
Net Income 2,050,378$ 2,088,684$ 2,127,678$
Factor 0.878212 0.846223 0.815399
Income Net Present Value (NPV) 1,800,666$ 1,767,492$ 1,734,907$
Jul-2027Apr-2027 Oct-2027
Lot Type Units Available Lot Price Sales Units Available Lot Price Sales Units Available Lot Price Sales
50-FF Lots 51 116,725$ 12 39 118,476$ 12 27 120,253$ 12
60-FF Lots 12 137,774$ 6 6 139,840$ 6 - -$ -
Revenue 2,227,344$ 2,260,754$ 1,443,037$
Tax Expense (26,563)$ (19,066)$ (11,339)$
Sales Expense (33,410)$ (33,911)$ (21,646)$
Net Income 2,167,371$ 2,207,777$ 1,410,053$
Factor 0.785698 0.757079 0.729502
Income Net Present Value (NPV) 1,702,900$ 1,671,462$ 1,028,637$
Apr-2028 Jul-2028Jan-2028
Crystal Park Public Improvement District No. 2 Improvement Area #1
112
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Note: Quarterly discount and appreciation calculations are averaged to the middle of the period.
Lot Type Units Available Lot Price Sales Units Available Lot Price Sales
50-FF Lots 15 $ 122,057 12 3 $ 123,888 3
60-FF Lots - - - - - -
Revenue 1,464,683$ 371,663$
Tax Expense (6,394)$ (433)$
Sales Expense (21,970)$ (5,575)$
Net Income 1,436,319$ 365,656$
Factor 0.702930 0.685755
Income Net Present Value (NPV) 1,009,632$ 250,750$
Oct-2028 Jan-2029
Total Net Revenue Over ~11 Quarters $19,781,918
Net Present Value (As-Is) at 16% Discount Rate $16,573,526
Rounded $16,574,000
Crystal Park Public Improvement District No. 2 Improvement Area #1
113
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
DISCOUNT CASH FLOW DATA – CRYSTAL PARK PID NO. 2 IA #1 (ANNUAL)
Note: Annual discount and appreciation calculations are averaged to the middle of the period
Lot Type Starting Units Lot Price Sales Units Available Lot Price Sales
50-FF Lots 123 107,497$ 24 99 112,335$ 48
60-FF Lots 48 127,008$ 12 36 132,723$ 24
Revenue 4,104,030$ 8,577,423$
Tax Expense (134,928)$ (222,092)$
Sales Expense (61,560)$ (128,661)$
Net Income 3,907,542$ 8,226,670$
Factor 0.963575 0.862069
Income Net Present Value (NPV) 3,765,209$ 7,091,957$
2026 2027
Lot Type Units Available Lot Price Sales Units Available Lot Price Sales
50-FF Lots 51 119,075$ 48 3 123,838$ 3
60-FF Lots 12 138,829$ 12 - - -
Revenue 7,381,529$ 371,513$
Tax Expense (108,101)$ (3,460)$
Sales Expense (110,723)$ (5,573)$
Net Income 7,162,706$ 362,481$
Factor 0.743163 0.685755
Income Net Present Value (NPV) 5,323,057$ 248,573$
2028 2029
Total Net Revenue Over ~4 Years $19,659,398
Net Present Value (As-Is) at 16% Discount Rate $16,428,796
Rounded $16,429,000
Crystal Park Public Improvement District No. 2 Improvement Area #1
114
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
DCF Conclusion (171 Improved 50’ and 60’ Lots)
Using the Discount Cash Flow analysis on both a quarterly and annual basis suggests the market value for the
171 improved lots in Crystal Park PID No. 2 IA #1 in a bulk sale transaction would be between $16,428,796 and
16,573,526, which is approximately $144,730 (0.88%) different. Both annual and quarterly DCF analyses have
relevance and are a check of reasonableness on each other, but we consider the quarterly analysis to be the more
accurate and precise calculation. Thus, we have determined that the market value for Crystal Park PID No. 2
IA #1 “Upon Completion” with a Prospective Effective Date of July 1, 2026, for 171 improved lots is
16,574,000 ($97,000 per lot rounded).
INCOME (SUBDIVISION DEVELOPMENT) APPROACH CONCLUSION
Using the Discount Cash Flow Analysis to determine the net present value as of the substantial completion date
July 1, 2026), we have determined the following value for Crystal Park PID No. 2 IA #1 as shown in the table
below:
Crystal Park PID No. 2 IA #1
171 Improved Residential Lots
INCOME APPROACH VALUE INDICATION
Fee Simple Interest, Complete July 1, 2026
16,574,000 ($97,000/Lot)
Rounded
Crystal Park Public Improvement District No. 2 Improvement Area #1
115
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
RECONCILIATION AND FINAL VALUE CONCLUSION
The Appraisal of Real Estate, Fourteenth Edition, copyright 2013, pages 641-642, published by the Appraisal
Institute states,
Resolving the differences among various value indications is called reconciliation…. The final value
opinion is not the average of the different value indications derived. No mechanical formula is used to select one
indication over the others…Final reconciliation relies on proper application of appraisal techniques and the
appraiser’s judgment.”
Three approaches to value are recognized in the appraisal profession (Sales Comparison Approach, Cost
Approach, and Income Approach). All three approaches were analyzed and developed as part of the scope of
work of this assignment. A summary of each approach follows:
Cost Approach
The Cost Approach provides information that contrasts with information from the Income and Sales Comparison
Approaches. It allows the appraiser to address the feasibility and highest and best use issues inherent in new
construction. This approach is most beneficial when appraising a proposed or recently built project and is
typically used when units make up a substantial portion of the entire project.
Since Crystal Park PID will be constructed in multiple phases, the Cost Approach is not appropriate and thus was
not utilized to value the improved lots in the Crystal Park PID No. 2 IA #1.
Income (Subdivision Development) Approach
For the improved residential lots, the Income (Subdivision Development) Approach applied in subdivision
analysis simulates what occurs in a bulk sale where one buyer purchases the bulk of the lots at a discount. Income
capitalization is the primary method used in subdivision valuation because value is determined by future sales
over time. Along with discounted cash flow analysis, income capitalization directly measures differences in
present value based on future cash flow projections. This approach provides a direct measure of the market value
or wholesale value of a group of lots or units, which is different from the sum of the retail lot prices.
Since the problem to be solved is to determine the bulk sale value of 171 improved residential lots in Crystal Park
PID No. 2 IA #1, as of the substantial completion date, the Income Approach is appropriate and was developed.
Through Discounted Cash Flow Analysis, we determined the market value of the 171 improved lots “Upon
Completion” in Crystal Park PID No. 2 IA #1 as of July 1, 2026, is $16,574,000 ($97,000 per lot rounded).
Sales Comparison Approach
For the improved lots, the Sales Comparison Approach was not fully developed because finding highly similar
and recent sales of improved groups of lots or subdivisions are not available in the market. Aspects of the Sales
Comparison Approach were utilized in concluding the retail lot market values for use in the Income Approach
for the improved lots within the Crystal Park PID No. 2 IA #1.
Crystal Park Public Improvement District No. 2 Improvement Area #1
116
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
Final Value Conclusion Summary
As a result of our investigations, studies and analysis of the sale, cost, income, and expense data, interpreted
within the context of all the factors in the marketplace which effect value, our reconciliation of the indicated
values between the utilized approaches to value are listed in the table below. We utilized the Income (Subdivision
Development) Approach to value the 171 improved lots. Our final value conclusion for the retail lot value and
the cumulative value of the lots are shown below:
Total
Lots
Feet Frontage
FF)
Retail
Price/Lot Effective Date
Price/FF
FF)
Total Retail
Value ($)
123 50 FF $106,750 July 1, 2026 $2135/FF $13,130,250
48 60 FF $126,000 July 1, 2026 $2100/FF $6,048,000
171 $19,178,250
CRYSTAL PARK PID No. 2 IA #1
After considering discount cash flows, our final value conclusion “Upon Completion” is shown below:
Crystal Park PID No. 2 IA #1
171 Improved Residential Lots
INCOME APPROACH VALUE INDICATION
Fee Simple Interest, Complete July 1, 2026
16,574,000 ($97,000/Lot)
Rounded
Exposure Time
Assuming adequate exposure and normal marketing efforts, the estimated exposure time (i.e. the length of time
the subject property would have been exposed for sale in the market had it sold at the market value concluded to
in this analysis as of the date of this valuation) would have been at least 6-12 months; the estimated marketing
time (i.e. the amount of time it would probably take to sell the subject property if exposed in the market beginning
on the date of this valuation) is estimated to be between 6-12 months.
Marketing Time
Marketing time is an estimate of the amount of time it might take to sell a property at the concluded market value
immediately following the Effective Date of value. Market conditions are presently strong, and we expect no
significant changes in the near term. It is our opinion that a reasonable marketing period for the subject is likely
to be the same as the exposure time. Accordingly, we estimate the subject’s marketing period at 6-12 months.
Absorption Schedule
Based on the absorption schedule developed by the appraisers, the 50-FF Lots sell at 12/Quarter starting in
3Q2026 and the 60-FF Lots sell at 6/Quarter starting in 3Q2026. All lots are anticipated to be taken down by
January 2029 or in approximately 34 months.
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ADDENDA
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ENGAGEMENT LETTER
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LEGAL DESCRIPTION
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ASSUMPTIONS AND LIMITING CONDITIONS
This report is subject to the following assumptions and limiting conditions:
1) The value assumes responsible ownership and competent management. The subject property is assumed to be
free and clear of all liens, except as may be otherwise described herein. No responsibility is assumed by the
appraiser for matters legal in character, nor is any opinion on the title rendered, which is assumed to be good
and marketable.
2) The information contained herein has been gathered from sources deemed to be reliable, but the appraiser
assumes no responsibility for its accuracy. Correctness of estimates, opinions, dimensions, sketches, and other
exhibits that have been furnished and have been used in this report are not guaranteed.
3) The value rendered herein is based on preliminary analyses of the subject and market area. The market value
is expressed in terms of the current purchasing power of the dollar.
4) Any leases, agreements or other written or verbal representations and/or communications and information
received by the appraiser have been reasonably relied upon in good faith but have not been analyzed for their
legal implications. We urge and caution the user of this report to obtain legal counsel of his/her own choice
to review the legal and factual matters, and to verify and analyze the underlying facts and merits of any
investment decision in a reasonably prudent manner.
5) Appraisers assume no responsibility for any hidden agreements known as "side reports", which may or may
not exist relative to this property, which have not been made known to us, unless specifically acknowledged
within this report.
6) This report is to be used in whole, and not in part. Any separate valuation for land and improvements shall
not be used in conjunction with any other valuation and is invalid if so used. Possession of this report or any
copy thereof does not carry with it the right of publication nor may the same be used for any purpose by
anyone but the client without the previous written consent of the appraiser, and in any event, only in its
entirety.
7) The appraiser, by reason of this report, is not required to give testimony in court with reference to the property
unless notice and proper arrangements have been previously made, therefore.
8) Neither all nor any part of the contents of this report shall be conveyed to the public through advertising,
public relations, news, sales or other media without prior written consent and approval of the author.
9) No subsoil data or analysis based on engineering core borings or other tests were furnished to us. We have
assumed that there are no subsoil defects present that would impair development of the land to its maximum
permitted use or would render it more or less valuable. No responsibility is assumed for engineering, which
might be required to discover such factors.
10) Any construction and physical condition of the improvements described herein are based on the building
construction plans and specifications and construction budgets if provided. No liability is assumed by the
appraiser for the soundness of structural members since no engineering tests were conducted. No liability is
assumed for the condition or adequacy of mechanical equipment, plumbing or electrical components. No
responsibility is assumed for engineering, which might be required to discover such factors. We urge the user
of this report to retain an expert in this field as this is any considered “to-be-built” improvements.
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11)Unless otherwise stated in this report, the existence of hazardous substances, including without limitation
asbestos, polychlorinated biphenyls, petroleum leakage, or agricultural chemicals, which may or may not be
present in or on the property, or other environmental conditions were not called to the attention of the appraiser
nor did the appraiser become aware of such during the appraiser site visit. The appraiser has no knowledge of
the existence of such materials on or in the property unless otherwise stated. The appraiser, however, is not
qualified to test such substances or conditions. If the presence of such substances as asbestos, urea
formaldehyde, foam insulation or other hazardous substance or environmental conditions may affect the value
of the property, the value is predicated on the assumption that there is no such condition on or in the property
or in such proximity thereto as to cause a loss in value. No responsibility is assumed for any such conditions,
nor for any expertise or engineering knowledge required to detect or discover them. We urge the user of this
report to retain an expert in the field of environmental impacts on real estate if so desired.
12)We have made no survey of the property and assume no responsibility in connected with such matters. Any
sketch or survey of the property included in this report is for illustrative purposes only and should not be
considered to be scaled accurately for size. The appraisal covers the property as described in this report, and
the areas and dimensions set forth are assumed to be correct.
13)We accept no responsibility for issues requiring expertise in other fields. Such factors include, but are not
limited to, legal descriptions and other legal matters such as legal title, geologic items such as soils and seismic
stability; civil, mechanical, electrical, structural, and other engineering and environmental matters. Such
issues may also include determinations of compliance with zoning and other federal, state, and local laws,
regulations, and codes.
14)The projections of income, expenses, terminal values, or future sales prices are not predictions of the future;
rather, they are the best estimate of current market thinking of what future trends will be. No warranty or
representation is made that these projections will materialize. The real estate market is constantly changing.
It is not the task of the appraiser to estimate the conditions of a future real estate market, but rather to reflect
what the investment community envisions for the future, and upon what assumptions of the future investment
decisions are based.
15)The client or user of this report agrees to notify the appraiser of any error, omission or inaccurate data
contained in the report within 15 days of receipt and return the report and all copies thereof to the appraiser
for correction prior to any use.
16)The acceptance of this report, and its subsequent use by the client or any other party in any manner whatsoever
for any purpose, is acknowledgment by the user that the report has been read and understood, and specifically
agrees that the data and analyses, to their knowledge, are correct and acceptable.
17)We have assumed no extreme fluctuations in the economic cycles will occur over the dates analyzed herein.
18)The appraisal report and value conclusions assume the satisfactory development proceeds in a workmanlike
manner.
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19)The conclusions in this report are estimates based on known current trends and reasonably foreseeable future
occurrences. These estimates are based partly on property information, existing trends, interviews with parties
knowledgeable and experienced in the market, data obtained from public records, and research conducted by
third parties. Such data is not always completely reliable. The appraisers are not responsible for these and
other future occurrences that could not have reasonably been foreseen on the Effective Date of this
assignment. In addition, it is inevitable that some assumptions will not materialize and that unanticipated
events may occur that will likely affect actual performance. While we hold the opinion that our finding is
reasonable based on current market conditions, we do not represent that these estimates will be achieved, as
they are forecasts and subject to risk and uncertainty. Additionally, we assume competent and effective
management and market for the duration of the projected holding period of this property.
20)Prospective value opinions presented in this report are estimates and forecasts which are prospective in nature
and are subject to risk and uncertainty. Many events could occur that may substantially alter the outcome of
our estimates such as changes in the economy, interest rates, capitalization rates, the behavior of consumers,
investors, and lenders, and changes in title or conveyances of easements and deed restrictions. It is assumed
that conditions reasonably foreseeable at the present time are consistent or similar to the future.
21)This assignment was not based upon a requested minimum valuation, a specific valuation, or the approval of
a loan. However, it is based on a hypothetical assumption that access to the south tract is achievable in
accordance with all applicable regulations, and any building is to be constructed according to the approved
plans and specifications provided by a licensed general contractor.
22)The Americans with Disabilities Act (ADA) became effective January 26, 1992. We have not made a specific
compliance survey and analysis of this property to determine whether it is in conformity with the various
detailed requirements of the ADA. It is possible that a compliance survey of the property together with a
detailed analysis of the requirements of the ADA could reveal that the property is not in compliance with one
or more requirements of the act. If so, this fact could have a negative impact upon the value of the property.
However, since we have no direct evidence relating to the issue of compliance, we did not consider possible
noncompliance with requirements of ADA in forming an opinion of the value of the property.
23) In addition to the preceding assumptions and limiting conditions, this appraisal is subject to the following
extraordinary assumptions and/or hypothetical conditions:
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EXTRAORDINARY ASSUMPTIONS AND HYPOTHETICAL CONDITIONS
Extraordinary Assumptions and Hypothetical Conditions
The value conclusions are subject to the following Extraordinary Assumptions that may affect the assignment
results. An Extraordinary Assumption is uncertain information accepted as fact. If the assumption is found to be
false as of the Effective Date of the appraisal, we reserve the right to modify our value conclusions. Extraordinary
Assumptions are used in this assignment because the improved residential lots to be delivered by the date utilized
in this report are currently incomplete as of the report date.
Our opinions of prospective market value at completion assumes that the proposed improvements are
completed in accordance with plans and specifications provided by LJA Engineering Inc., the
Professional Engineers, dated August 1, 2023 for 171 improved residential lots in Crystal Park PID No.
2 IA #1.
All information relative to the property located within Crystal Park PID No. 2 IA #1 including land areas,
lot totals, lot sizes, and other pertinent data that was provided by Bloomfield Homes, LP (the
Developer”), LJA Engineering Inc. (Professional Engineers and Surveyors), the City of Anna, Collin
County, and the Collin Central Appraisal District (CCAD) is assumed to be correct.
The subject is proposed residential lots construction with an expected prospective completion date of
July 1, 2026; therefore, this report contains a prospective opinion of value. Considering this, we have
assumed that the market conditions discussed and considered within this report will be similar on the
prospective valuation date. Further, we cannot be held responsible for unforeseeable global events that
alter market conditions prior to the prospective Effective Date.
The use of these extraordinary assumptions has affected assignment results.
In addition to the Extraordinary Assumptions, the value conclusions are based on the following Hypothetical
Conditions that may affect the assignment results. A Hypothetical Condition is a condition contrary to known
fact on the Effective Date of the appraisal but is supposed for the purpose of analysis.
No Hypothetical Conditions are used in this report.
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ENVIRONMENTAL ASSUMPTIONS
This report is subject to the following environmental assumptions:
1) There is a safe, lead-free, adequate supply of drinking water.
2) The subject property is free of soil contamination.
3) There is no uncontained friable asbestos or other hazardous asbestos material on the property. The
appraiser is not qualified to detect such substances.
4) There are no uncontained PCB's on or near the property.
5) The radon level is at or below EPA recommended levels.
6) Any functioning underground storage tanks (UST's) are not leaking and are properly registered; any
abandoned UST's are free from contamination and were properly drained, filled, and sealed.
7) There are no hazardous waste sites on or near the subject property that negatively affect the value and/or
safety of the property.
8) There is no significant urea formaldehyde (UFFI) insulation or other urea formaldehyde material on the
property.
9) There is no flaking or peeling of lead-based paint on the property.
10) The property is free of air pollution.
11) There are no wetlands/flood plains on the subject property (unless otherwise stated in the report).
12) There are no other miscellaneous hazardous substances and/or detrimental environmental conditions on
or in the area of the site (excess noise, radiation, light pollution, magnetic radiation, acid mine drainage,
agricultural pollution, waste heat, miscellaneous chemical, infectious medical wastes, pesticides,
herbicides, and the like).
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DEFINITIONS
Fee Simple Estate
Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the
governmental powers of taxation, eminent domain, police power and escheat.
Leased Fee Interest
The ownership interest held by the lessor includes the right to receive the contract rent specified in the lease plus
the reversionary right when the lease expires.
Leasehold Interest
The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in
the lease.
Market Rent
The most probable rent that a property should bring in a competitive and open market reflecting the conditions
and restrictions of a specified lease agreement, including the rental adjustment and revaluation, permitted uses,
use restrictions, expense obligations, term, concessions, renewal and purchase options, and tenant improvements
TIs).
Market Value
Market value means the most probable price which a property should bring in a competitive and open market
under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and
assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as
of a specified date and the passing of title from seller to buyer under conditions whereby:
1) Buyer and seller are typically motivated;
2) Both parties are well informed or well advised, and acting in what they consider their own best
interests;
3) A reasonable time is allowed for exposure in the open market;
4) Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable
thereto; and
5) The price represents the normal consideration for the property sold unaffected by special or creative
financing or sales concessions granted by anyone associated with the sale.
The value conclusions expressed within this report are in terms of cash ($US).
Extraordinary assumptions are assignment-specific assumptions as of the Effective Date regarding uncertain
information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.
Hypothetical condition a condition, directly related to a specific assignment, which is contrary to what is known
by the appraiser to exist on the Effective Date of the assignment results but is used for the purpose of analysis.
Prospective Opinion of Value
A value opinion effective as of a specified future date. The term does not define a type of value. Instead, it
identifies a valued opinion as being effective at some specific future date. An opinion of value as of a prospective
date is frequently sought in connection with projects that are proposed, under construction, or under conversion
to a new use, or those that have not yet achieved sellout or a stabilized level of long-term occupancy.
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Prospective Market Value “As Completed” and “As Stabilized”
A prospective market value may be appropriate for the valuation of a property interest related to a credit decision
for a proposed development or renovation project. According to USPAP, an appraisal with a prospective market
value reflects an Effective Date that is subsequent to the date of the Appraisal Report. Prospective value opinions
are intended to reflect the current expectations and perceptions of market participants, based on available data.
Two prospective value opinions may be required to reflect the time frame during which development,
construction, and occupancy will occur. The prospective market value—as completed - reflects the property’s
market value as of the time that development is expected to be completed. The prospective market value - as
stabilized - reflects the property’s market value as of the time the property is projected to achieve stabilized
occupancy. For an income-producing property, stabilized occupancy is the occupancy level that a property is
expected to achieve after the property is exposed to the market for lease over a reasonable period of time and at
comparable terms and conditions to other similar properties. (See USPAP Statement 4* and Advisory Opinion
17.) (Interagency Appraisal and Evaluation Guidelines)
Retrospective Value Opinion
A value opinion effective as of a specified historical date. The term retrospective does not define a type of value.
Instead, it identifies a valuable opinion as being effective at some specific prior date. Value as of a historical date
is frequently sought in connection with property tax appeals, damage models, lease renegotiation, deficiency
judgments, estate tax, and condemnation. Inclusion of the type of value with this term is appropriate, e.g.,
retrospective market value opinion.”
Neighborhood
1) A group of complementary land users; a congruous grouping of inhabitants, buildings, or business
enterprises.
2) A developed residential super pad within a master-planned community usually has a distinguishing
name and entrance.
Depreciation
1. In appraisal, a loss in property value from any cause; the difference between the cost of an improvement
on the Effective Date of the appraisal and the market value of the improvement on the same date.
2. In accounting, an allocation of the original cost of an asset, amortizing the cost over the asset’s life;
calculated using a variety of standard techniques.
The three major types of accrued depreciation are:
Physical Deterioration
Physical deterioration is loss in value from actual physical causes and measured either as curable or incurable.
The curable items are measured by the actual cost to replace or repair the component parts. The incurable portion
is estimated by virtue of an observed condition or ascertaining the used portion by the best estimate of the
appraiser. Curable physical deterioration, also referred to as deferred maintenance, is caused by normal wear and
tear that should be corrected immediately or is necessary to keep rents at market levels. The cost of curing the
condition and bringing the property to a satisfactory and functioning condition is generally the measure of deferred
maintenance.
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Functional Obsolescence
Functional obsolescence is loss in value from conditions existing within the property which make the property
inadequate or less desirable to the typical prudent purchaser. It, too, may be curable or incurable. Incurable
obsolescence is normally measured by the loss in income which may accrue to the property by reason thereof.
External Obsolescence
According to the Dictionary of Real Estate Appraisal, Sixth Edition, external obsolescence is “A type of
depreciation; a diminution in value caused by negative external influences and generally incurable on the part
of the owner, landlord, or tenant. The external influence may be either temporary or permanent.”
Paper Lot
Consists of a portion of land with the necessary legal (zoning and platting) and engineering entitlements (site plan
approvals) in place but lacking the necessary direct improvements (such as earthwork, erosion control, drainage,
retaining walls, and landscaping in addition to lacking direct access from a paved street and utilities) to develop
a lot with a residence. The paper lots have access to utilities stubbed nearby and have a status between raw ground
and a fully developed lot upon which home construction can begin.
Definition Sources:
Office of the Comptroller of the Currency (12 CFR Part 34)
Appraisal Institute, The Dictionary of Real Estate Appraisal, Sixth Edition, copyright 2015.
The Appraisal Foundation: USPAP (Uniform Standards of Professional Appraisal Practice) 2018-
2019 edition
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JAMES L. MAIBACH, CPM - STATE CERTIFIED GENERAL REAL ESTATE APPRAISER
EDUCATION:
Graduate North Quincy High School, Quincy, Massachusetts, 1976
Bachelor of Science in Business Administration (with Honors)
Northeastern University, Boston Massachusetts, 1981
Major: Accounting Minor: Marketing
TECHNICAL TRAINING:
Institute of Real Estate Management Courses:
303 - Leasing and Management of Shopping Center and Retail Space
400 - Managing Real Estate as an Investment
500 - Problem-Solving & Decision-Making for the Property Manager
800 - Ethics in Real Estate Management
University of Texas at Arlington: Real Estate Courses:
RE 001 Real Estate Finance; RE 004 Real Estate Mathematics;
RE 101 Principles of Real Estate; RE 301 Texas Real Estate Law: Contracts;
RE 501 Texas Real Estate Law; RE 701 Property Management
East Texas Baptist University:
Uniform Standards of Professional Appraisers and Code of Ethics. The Appraisal Foundation:
USPAP Update
Texas Association of Property Tax Professionals, Inc.:
Principles of Property Tax Consulting; A Survey of Texas Property Tax Law
Other: USPAP-97 Instructor's Workshop, USPAP Instructor 1997
TREC Licensed Instructor – Commercial Investment Course, CEI 1998
Continuing Education Institute:
Deceptive Trade Practices Act; Let’s Talk-Not Fight; Property Taxes: Rights, Remedies and Responsibilities; USPAP Update
Institute for Real Estate Professionals, Inc.
Preparing & Presenting an Ethical Ad Valorem Property Tax Valuation; Texas Property Tax Law 2007
Texas Association of Realtors:
Tarrant County Appraisal Review Board Member (1991-1992)
PROFESSIONAL AFFILIATIONS:
Texas Appraiser Licensing and Certification Board - State Certified General Real Estate Appraiser No. TX-1323658-G since 1992
Institute of Real Estate Management (IREM)- Certified Property Manager, CPM Designation No. 14942 since 1993
Texas Real Estate Broker's License, No. 375882 since 1989
Texas Dept. of Licensing & Regulations - Licensed Property Tax Consultant, License #1360 since inception
Texas Property Tax Arbitrator #32020394139 since 2006
Tarrant Appraisal Review Board Member 1991-1992 Appointment
City of Arlington - Planning and Zoning – Commissioner1997-2003 (Appointed by Mayor and City Council)
American Planning Association – Member 1997 to 2003
Greater Arlington Chamber of Commerce - Board of Directors 1995 to 2001 – Reappointed 2003 to 2006 – Reappointed 2008 to 2014
Chairman of the Board 2022, now servicing as Chairman of the Chamber Foundation Board
City of Arlington Parks & Recreation – Board of Directors, Appointed 2003 to 2007
Levitt Pavilion – Board of Directors since 2014
EXPERIENCE:
Active field appraiser, property manager, developer, broker, and tax consultant of all types of real property since June,1986. Appeared
in Texas State Court as an expert witness on real estate values on numerous occasions (1990s, 2000s, 2020s). A property manager and
developer for nineteen years at Peyco Properties, Inc. and twenty-one years through Peyco Southwest Realty, Inc. (formerly
Southwest Real Estate Services, Inc.), involved in real estate development, leasing, management, rent analysis and consulting services
through the DFW metroplex and Colorado. President and founder of Peyco Southwest Realty, Inc. (Southwest Real Estate Services,
Inc.), a full-service brokerage company, real estate appraisal, and ad valorem property tax representation firm.
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LESLIE TOLLIVER - STATE CERTIFIED GENERAL REAL ESTATE APPRAISER
EDUCATION:
MBA – Masters in Business Administration –University of Phoenix (3.95 GPA)
Bachelor of Science in Business Administration -University of Phoenix
Graduate Owings Mills High School, Owings Mills, Maryland, 1988
TECHNICAL TRAINING:
Appraisal Institute, Associate Member – 300+ hours of qualifying and continuing education
University of Texas in Arlington – 180 hours of qualifying education for the Texas Real Estate License
Southern Methodist University – qualifying education for the Texas Comptroller Arbitrator registry
PROFESSIONAL AFFILIATIONS:
Texas Appraiser Licensing and Certification Board –State Certified General Appraiser No. TX-1381494
Texas Appraiser Licensing and Certification Board –State Certified Residential Appraiser No. TX-1361274
Texas Real Estate Commission – Real Estate Broker License, No. 0468343
EXPERIENCE:
10 Years’ experience as a fee appraiser for residential and commercial properties for Peyco Southwest Realty, Aloft Appraisals,
and G.S. Zachary Company
o Residential appraisals – area of expertise is in north Texas region; FHA certified
o Commercial appraisals - throughout the states of Texas and Oklahoma
25 Years’ experience as a residential and commercial real estate broker for multiple firms
o Savage Realty Investments – Founding President
Negotiated contracts for clients in over $50 million dollars of real estate transactions
Managed and trained over 25 Real Estate Agents
o Fathom Realty – Broker Team Leader
Trained and mentored Real Estate Agents and assisted them with contracts and client transactions
25 Years’ experience as a Property Tax Consultant
o Valued properties, prepared cases, and appeared before Appraisal Review Boards to dispute the tax valuations of
residential, commercial, and business personal property throughout the nation. Major clientele base included national
accounts such as: Sonic restaurants, Church’s Chicken restaurants, and Chuck-E-Cheese restaurants
10 Years’ experience as a Real Estate Arbitrator on the Texas Comptroller registry
o Act as an Arbitrator for real estate cases involving property tax disputes on residential, commercial, and business
personal property taxes throughout Texas
o Made binding valuation determinations for the disputed properties
16 Years’ experience as a Real Estate Instructor at the University of Texas in Arlington
o Adjunct instructor, teaching real estate classes to students pursuing a Real Estate Agent license in Texas
6 Years’ experience as a Real Estate Arbitrator Instructor at the University of Texas in Arlington
o Adjunct instructor, teaching continuing education classes to existing Arbitrators on the Texas Comptroller’s registry
o Trained and mentored many Arbitrators
3 Year’s expectancy as a Real Estate Acquisition and Valuation Analyst for multiple firms
o KeyGlee – Provided valuation of residential real estate for wholesaling to real estate investors
o Hyperion Homes – Provided valuation of residential real estate for rent-to-own clients
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BROOKE CLOCK – LICENSED RESIDENTIAL APPRAISER
TECHNICAL TRAINING:
McKissock Learning Appraisal Courses:
Advanced Residential Applications and Case Studies
Residential Report Writing and Case Studies
Statistics, Modeling and Finance
Appraisal Subject Matter Electives
Residential Appraiser Site Valuation and Cost Approach
Residential Market Analysis and Highest and Best Use
Residential Sales Comparison and Income Approaches
Basic Appraisal Procedures
2020-2021 National USPAP Course
Short Sales and Foreclosures
Fair Housing
Characteristics of Real Estate Title Insurance
APPRAISAL EXPERIENCE:
April 2024 – Present
Licensed Residential Appraiser with Peyco Southwest Realty, Arlington, TX
Written Reports on Commercial Industrial, Commercial Office, Vacant Land
Property Tax Consultant (#13083)
Business Personal Property
April 2023-April 2024
Licensed Residential Appraiser with RSDS Appraisal Diversity, Irving, TX
Residential Real Estate Appraisals – area of expertise in the North Texas Region
March 2022-February 2023
Real Estate Appraiser Trainee with Aloft Appraisal
Residential Real Estate Appraisals – area of expertise in the North Texas Region
April 2021-February2022
Real Estate Appraiser Trainee with ASI, Inc.
Residential Real Estate Appraisals – area of expertise in the North Texas Region
January 2009 – August 2021
Licensed Real Estate Agent with Elite Real Estate
Real Estate Agent with a focus on lead generation, appointment setting, and follow-up. Concentrating on
client’s needs and providing solutions to assist in closing transactions. Proficient at negotiating deals, listing
properties, and finding buyers
Develop Broker Price Opinions for lenders in real estate transactions
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BRANDON LAWSON – APPRAISER TRAINEE
EDUCATION:
Bachelor of Arts - Communication, 2021 - University of Arkansas (3.97 GPA)
Master of Arts - Communication, 2023 - University of Arkansas (4.0 GPA)
Graduate Arlington Martin High School, Arlington, Texas, 2017
TECHNICAL TRAINING:
McKissock – 79 hours of qualifying education for the Appraiser Trainee license
2024-2025 15 Hour National USPAP Course (QE) – 15 hours
General Appraiser Sales Comparison Approach – 30 hours
Business Practices and Ethics – 6 hours
The Discounted Cash Flow Model: Concepts, Issues, and Apps. – 5 hours
Artificial Intelligence, Blockchain, and the Metaverse: Implications for Valuation – 7 hours
Subdivision Valuation – 7 hours
Champions School of Real Estate - 180 hours of qualifying education for the Texas Real Estate License
Real Estate Brokerage – 30 hours
PROFESIONAL AFFILIATIONS:
Texas Appraiser Licensing and Certification Board – Appraisal Trainee No. TX-1343865
Texas Real Estate Commission – Real Estate Sales Agent License, No. 818543
Associate Member, Appraisal Institute – since 2023
APPRAISER EXPERIENCE
July 2023-Present
Appraiser Trainee with Peyco Southwest Realty, Arlington TX
Commercial Appraisals – throughout that state of Texas
Crystal Park Public Improvement District No. 2 Improvement Area #1
147
Peyco Southwest Realty • 1703 North Peyco Drive • Arlington, Texas 76001
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