Loading...
HomeMy WebLinkAboutMunicipal Property Corporation - Resolutions (17) $15, 750 , 000 TOWN OF ORO VALLEY MUNICIPAL PROPERTY CORPORATION EXCISE TAX REVENUE REFUNDING BONDS, SERIES 2003 BOND PURCHASE AGREEMENT November 13 , 2003 Town of Oro Valley Municipal Property Corporation Oro Valley, Arizona On the basis of the representations, warranties and covenants contained in this Bond Purchase Agreement and upon the terms and conditions contained herein, the undersigned, on behalf of Stone & Youngberg LLC (the "Underwriter") , hereby offers to enter into the following agreement with the Town of Oro Valley Municipal Property Corporation (the "Corporation") in connection with the purchase and sale of the captioned Bonds (the "Bonds") . Upon the Corporation' s written acceptance of this offer and the execution and delivery by the Town of Oro Valley, Arizona (the "Town") , of the Letter of Representation, dated the date hereof and in the form of Exhibit A hereto (the "Letter of Representation") , this Bond Purchase Agreement will be binding upon the Corporation and upon the Underwriter. This offer is made subject to the Corporation' s written acceptance hereof and subject to the execution and delivery of the Letter of Representation on or before 11 : 59 p.m. , MST, on November 13 , 2003 , and, if not so accepted or if the Letter of Representation is not so executed and delivered, this offer will be subject to withdrawal by the Underwriter upon notice delivered to the Corporation at any time prior to the acceptance hereof by the Corporation and execution and delivery of the Letter of Representation. Terms not otherwise defined in this Bond Purchase Agreement shall have the same meanings set forth in the "Indenture" or "Official Statement" (as such terms are defined herein) . The Bonds shall be as described in, and shall be issued and secured under and pursuant to the provisions of a Trust Indenture, dated as of April 1, 1996 (the "Indenture") , as supplemented by a First Supplement to Trust Indenture, dated as of June 1, 1999 (the "First Supplemental Indenture") , by a Second Supplement to Trust Indenture, dated as of April 1, 2001 (the "Second Supplemental Indenture") and by a Third Supplement to Trust Indenture, to be dated as of December 1, 2003 (the "Third Supplemental Indenture") (the "Third Supplemental Indenture" and the Indenture as supplemented by the First Supplemental Indenture, the Second Supplemental Indenture and the Third Supplemental Indenture, the "Indentures") , between the Corporation and Wells Fargo Bank Arizona, N.A. , as trustee (together with its successors, if any, as trustee under the Indentures, the "Trustee") . Concurrently with the execution of the Third Supplemental Indenture, the Corporation and the Town will enter into a Third Amendment to Lease-Purchase Agreement, to be dated as of December 1, 2003 (the "Third Amendment") , which amends the Lease-Purchase Agreement, dated as of April 1 , 1996 (the "1996 Lease-Purchase Agreement") , as amended by the First Amendment to Lease-Purchase Agreement, dated as of June 1, 1999 (the "First Amendment") and the Second Amendment to Lease-Purchase Agreement, dated as of April 1, 2001 (the "Second Amendment" and the 1996 Lease-Purchase Agreement as amended by the First Amendment, the Second Amendment and the Third Amendment, the "Lease-Purchase Agreement") , between the Corporation, as lessor, the Town, as lessee, and the Trustee . The rental payments made by the Town pursuant to the Lease-Purchase Agreement will be used to pay part of the principal of and premium, if any, and interest requirements on the Bonds and other parity bonds issued under the Indentures . The payment of principal of and interest on the Bonds when due will be insured by a financial guaranty insurance policy (the "Bond Insurance Policy") to be issued by Ambac Assurance Corporation (the "Bond Insurer" ) . The Bonds will be offered by means of the Preliminary Official Statement of the Corporation, dated October 3 , 2003 (including the cover page and all appendices, the "Preliminary Official Statement") , relating to the Bonds and the final Official Statement of the Corporation, dated the date of this Bond Purchase Agreement (including the cover page and all appendices, the "Official Statement" ) , relating to the Bonds . The Town will enter into and deliver a written undertaking, to be dated the date of initial delivery of the Bonds (the "Continuing Disclosure Undertaking") , to provide, or cause to be provided, ongoing disclosure for the benefit of the owners of the Bonds as described in the Continuing Disclosure Undertaking for purposes of Rule 15c2-12 promulgated under the Securities Exchange Act of 1934 (the "Disclosure Rule" ) . The proceeds of the sale of the Bonds will be deposited with the Trustee, as depository trustee, and used to finance the refunding of certain obligations described in the Official Statement and to pay costs of issuance of the Bonds . The Corporation, the Town and Wells Fargo Bank Arizona, N.A. , as depository trustee (the "Depository Trustee" ) will execute and deliver a Depository Trust Agreement, to be dated as of December 1, 2003 (the "Depository Trust Agreement") , to accomplish such refunding. (This Bond Purchase Agreement, the Indentures, the Lease-Purchase Agreement, the Depository Trust Agreement, and any and all such other agreements and documents as may be required to be executed, delivered and/or received in order to carry out, give effect to, and consummate the transactions contemplated herein and in the Official Statement are 2 referred to herein as the "Corporation Documents. " The Letter of Representation, the Lease-Purchase Agreement, the Depository Trust Agreement, the Continuing Disclosure Undertaking and any and all such other agreements and documents as may be required to be executed, delivered and/or received in order to carry out, give effect to, and consummate the transactions contemplated herein and in the Official Statement are referred to herein as the "Town Documents. ") 1 . Purchase and Sale of the Bonds. (a) The Underwriter hereby agrees to purchase from the Corporation, and the Corporation hereby agrees to sell and deliver to the Underwriter, all, but not less than all, of the Bonds . Inasmuch as this purchase and sale represents a negotiated transaction, the Corporation understands, and hereby confirms, that the Underwriter is not acting as a fiduciary or agent of the Corporation, but rather is acting solely in its capacity as Underwriter for its own account . The Underwriter has been duly authorized to execute this contract and to act hereunder. (b) The principal amount of the Bonds to be issued, the dated date therefor, the maturities and optional redemption provisions and interest rates per annum are set forth in Schedule 1 hereto. (c) The purchase price for the Bonds shall be $15, 815, 688 . 85 (the "Purchase Price") plus interest accrued on the Bonds from the dated date of the Bonds to the Closing Date (as such term is hereinafter defined) . The Purchase Price represents : Par amount of Bonds $15, 750, 000 . 00 Net Original Issue Premium 172 , 001 .35 (Underwriter' s Discount) 106, 312 .50 Purchase Price $15, 815, 688 . 85 For the convenience of the Corporation, the Underwriter will, at or before the time of Closing, pay on behalf of the Corporation $90, 587 . 66 to the Bond Insurer as payment of the bond insurance premium for the Bond Insurance Policy on the Bonds, resulting in a net amount to be paid by the Underwriter to the Corporation at the time of Closing of $15, 725, 101 . 19, plus such accrued interest . 2 . Public Offering. The Underwriter intends to make a bona fide public offering of the Bonds at the offering prices or yields set forth in Schedule 1, and based upon those initial offering prices or yields, the Underwriter would receive compensation of $106, 312 . 50; however, the Underwriter may offer a portion of the Bonds for sale to selected dealers who are members of the National Association of Securities Dealers, Inc . and who agree to resell the Bonds to the public on terms consistent with this Bond Purchase Agreement and the Underwriter reserves the right to change such offering prices or yields as the Underwriter shall deem necessary in connection with the marketing of the Bonds and to offer and sell the Bonds to certain dealers (including dealers depositing the Bonds into investment 3 trusts) and others at prices lower than the initial offering prices or at yields higher than the initial yields set forth in Schedule 1 and in the Official Statement . The Underwriter also reserves the right to over-allot or effect transactions that stabilize or maintain the market price of the Bonds at a level above that which might otherwise prevail in the open market and to discontinue such stabilizing, if commenced, at any time. None of such activities shall affect the principal amounts, maturity dates, interest rates, redemption or other provision of the Bonds or the amount to be paid by the Underwriter to the Corporation for the Bonds . 3 . The Official Statement. (a) The Preliminary Official Statement has been prepared for use in connection with the public offering, sale and distribution of the Bonds by the Underwriter. The Corporation hereby deems the Preliminary Official Statement "final" as of its date for purposes of the Disclosure Rule, except for the omission of such information which is dependent upon the final pricing of the Bonds for completion, all as permitted to be excluded by Section (b) (1) of the Disclosure Rule. (b) The Corporation hereby authorizes the Official Statement and the information therein contained to be used by the Underwriter in connection with the public offering and the sale of the Bonds . The Corporation consents to the use by the Underwriter prior to the date hereof of the Preliminary Official Statement in connection with the public offering of the Bonds . The Corporation shall provide, or cause to be provided, to the Underwriter as soon as practicable after the date of the Corporation' s acceptance of this Bond Purchase Agreement (but, in any event, not later than within seven (7) business days after the Corporation' s acceptance of this Bond Purchase Agreement and in sufficient time to accompany any confirmation that requests payment from any customer) copies of the Official Statement which is complete as of the date of its delivery to the Underwriter in such quantity as the Underwriter shall request in order for the Underwriter to comply with Section (b) (4) of the Disclosure Rule and the rules of the Municipal Securities Rulemaking Board. (c) I f, after the date of this Bond Purchase Agreement to and including the date the Underwriter is no longer required to provide an Official Statement to potential customers who request the same pursuant to the Disclosure Rule (the earlier of (i) 90 days from the "end of the underwriting period" (as defined in Rule) and (ii) the time when the Official Statement is available to any person from a nationally recognized municipal securities repository, but in no case less than 25 days after the "end of the underwriting period" for the Bonds) , the Corporation becomes aware of any fact or event which might or would cause the Official Statement, as then supplemented or amended, to contain any untrue statement of a material fact or to omit to state a material fact required to be stated therein or necessary to make the statements therein, not misleading, or if it is necessary to amend or supplement the Official Statement to comply with law, the Corporation will notify the Underwriter (and for the purposes of this 4 clause provide the Underwriter with such information as it may from time to time request) , and if, in the opinion of the Underwriter, such fact or event requires preparation and publication of a supplement or amendment to the Official Statement, the Corporation will forthwith prepare and furnish, at the Corporation' s own expense (in a form and manner approved by the Underwriter) , a reasonable number of copies of either amendments or supplements to the Official Statement so that the statements in the Official Statement as so amended and supplemented will not, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading or so that the Official Statement will comply with law. If such notification shall be subsequent to the Closing, the Corporation shall furnish such legal opinions, certificates, instruments and other documents as the Underwriter may deem necessary to evidence the truth and accuracy of such supplement or amendment to the Official Statement . (d) The Underwriter hereby agrees to file the Official Statement with a nationally recognized municipal securities information repository. Unless otherwise notified in writing by the Underwriter, the Corporation can assume that the "end of the underwriting period" for purposes of the Rule is the date of the Closing. 4 . Representations, Warranties, and Covenants of the Corporation. The undersigned, on behalf of the Corporation, but not individually, hereby, as applicable, represents and warrants to and covenants with the Underwriter that : (a) The Corporation is a nonprofit corporation duly created, organized and existing under the laws of the State of Arizona (the "State") and has full legal right, power and authority, and at the date of the Closing will have full legal right, power and authority (i) to enter into, execute and deliver the Corporation Documents, (ii) to sell, issue and deliver the Bonds to the Underwriter as provided herein, and (iii) to carry out and consummate the transactions contemplated by the Corporation Documents and the Official Statement, and the Corporation has complied, and will at the Closing be in compliance in all respects, with the terms of the Corporation Documents as they pertain to such transactions; (b) By all necessary official action of the Corporation prior to or concurrently with the acceptance hereof, the Corporation has duly authorized all necessary action to be taken by it for (i) the execution and delivery of the Corporation Documents and the issuance and sale of the Bonds, (ii) the approval, execution and delivery of, and the performance by the Corporation of the obligations on its part, contained in the Bonds and the Corporation Documents and (iii) the consummation by it of all other transactions contemplated by the Official Statement and the Corporation Documents . (c) The Corporation Documents constitute legal, valid and binding obligations of the Corporation, enforceable in accordance with 5 their respective terms, subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws and principles of equity relating to or affecting the enforcement of creditors ' rights; the Bonds, when issued, delivered and paid for, in accordance with the Indentures and this Bond Purchase Agreement, will constitute legal , valid and binding obligations of the Corporation entitled to the benefits of the Indentures and enforceable in accordance with their terms, subject to bankruptcy insolvency, reorganization, moratorium and other similar laws and principles of equity relating to or affecting the enforcement of creditors ' rights; upon the issuance, authentication and delivery of the Bonds as aforesaid, the Indentures will provide, for the benefit of the holders, from time to time, of the Bonds, the legally valid and binding pledge of and lien it purports to create as set forth in the Indentures; (d) The Corporation is not in breach of or default in any material respect under any applicable constitutional provision, law or administrative regulation of the State or the United States or any applicable judgment or decree or any loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the Corporation is a party or to which the Corporation is or any of its property or assets are otherwise subject, and no event has occurred and is continuing which constitutes or with the passage of time or the giving of notice, or both, would constitute a default or event of default by the Corporation under any of the foregoing; and the execution and delivery of the Bonds and the Corporation Documents and compliance with the provisions on the Corporation' s part contained therein, will not conflict with or constitute a breach of or default under any constitutional provision, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the Corporation is a party or to which the Corporation is or to which any of its property or assets are otherwise subject nor will any such execution, delivery, adoption or compliance result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the Corporation to be pledged to secure the Bonds or under the terms of any such law, regulation or instrument, except as provided by the Bonds and the Indentures; (e) All authorizations, approvals, licenses, permits, consents and orders of any governmental authority, legislative body, board, agency or commission having jurisdiction of the matter which are required for the due authorization of, which would constitute a condition precedent to, or the absence of which would materially adversely affect the due performance by the Corporation of its obligations under the Corporation Documents and the Bonds have been duly obtained, except for such approvals, consents and orders as may be required under the "blue sky" or securities laws of any jurisdiction in connection with the offering and sale of the Bonds; (f) The Bonds conform to the descriptions thereof contained in the Official Statement under the captions "THE SERIES 2003 BONDS; " the Indentures and the Lease-Purchase Agreement conform 6 to the descriptions thereof contained in the Official Statement under the captions "THE SERIES 2003 BONDS, " and APPENDIX A - "SUMMARIES OF THE PRINCIPAL DOCUMENTS; " and the proceeds of the sale of the Bonds will be applied generally as described in the Official Statement; (g) There is no legislation, action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government agency, public board or body, pending or threatened against the Corporation, affecting the existence of the Corporation or the titles of its officers to their respective offices, or affecting or seeking to prohibit, restrain or enjoin the sale, issuance or delivery of the Bonds or the collection of payments promised for the payment of principal of and interest on the Bonds pursuant to the Indentures or in any way contesting or affecting the validity or enforceability of the Bonds, the Corporation Documents, or contesting the exclusion from gross income of interest on the Bonds for federal income tax purposes or State income tax purposes, or contesting in any way the completeness or accuracy of the Preliminary Official Statement or the Official Statement or any supplement or amendment thereto, or contesting the powers of the Corporation or any authority for the issuance of the Bonds or the execution and delivery of the Corporation Documents, nor is there any basis therefor, wherein an unfavorable decision, ruling or finding would materially adversely affect the validity or enforceability of the Bonds or the Corporation Documents; (h) As of the date thereof, the Preliminary Official Statement did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (i) At the time of the Corporation' s acceptance hereof and (unless the Official Statement is amended or supplemented pursuant to paragraph (d) of Section 3 of this Bond Purchase Agreement) at all times subsequent thereto during the period up to and including the date of Closing, the Official Statement does not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (j ) If the Official Statement is supplemented or amended pursuant to paragraph (d) of Section 3 of this Bond Purchase Agreement, at the time of each supplement or amendment thereto and (unless subsequently again supplemented or amended pursuant to such paragraph) at all times subsequent thereto during the period up to and including the date of Closing the Official Statement as so supplemented or amended will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which made, not misleading; 7 (k) The Corporation will apply, or cause to be applied, the proceeds from the sale of the Bonds as provided in and subject to all of the terms and provisions of the Indentures and will not take or omit to take any action which action or omission will adversely affect the exclusion from gross income for federal income tax purposes or State income tax purposes of the interest on the Bonds; (1) The Corporation will furnish such information and execute such instruments and take such action in cooperation with the Underwriter as the Underwriter may reasonably request (A) to (y) qualify the Bonds for offer and sale under the "blue sky" or other securities laws and regulations of such states and other jurisdictions in the United States as the Underwriter may designate and (z) determine the eligibility of the Bonds for investment under the laws of such states and other jurisdictions and (B) to continue such qualifications in effect so long as required for the distribution of the Bonds (provided, however, that the Corporation will not be required to qualify as a foreign corporation or to file any general or special consents to service of process under the laws of any jurisdiction) and will advise the Underwriter immediately of receipt by the Corporation of any notification with respect to the suspension of the qualification of the Bonds for sale in any jurisdiction or the initiation or threat of any proceeding for that purpose; (m) The financial statements of, and other financial information regarding, the Town in the Official Statement fairly present the financial position and results of the Town as of the dates and for the periods therein set forth. Prior to the Closing, there will be no adverse change of a material nature in such financial position, results of operations or condition, financial or otherwise, of the Town, and to the Town is not a party to any litigation or other proceeding pending or threatened which, if decided adversely to the Town, would have a materially adverse effect on the financial condition of the Town; (n) Prior to the Closing, the Corporation will not offer or issue any bonds, notes or other obligations for borrowed money or incur any material liabilities, direct or contingent, payable from or secured by any of the revenues or assets which will secure the Bonds without the prior approval of the Underwriter; and (o) Any certificate, signed by any official of the Corporation authorized to do so in connection with the transactions contemplated by this Bond Purchase Agreement, shall be deemed a representation and warranty by the Corporation to the Underwriter as to the statements made therein. 5 . Closing. (a) At 8 : 00 a.m. MST time, on December 18, 2003 , or at such other time and date as shall have been mutually agreed upon by the Corporation and the Underwriter (the "Closing") , the Corporation will, subject to the terms and conditions hereof, deliver the Bonds to 8 the Underwriter in the aggregate principal amount of each such maturity duly executed and authenticated, together with the other documents hereinafter mentioned, and the Underwriter will, subject to the terms and conditions hereof, accept such delivery and pay the purchase price of the Bonds as set forth in Section 1 of this Bond Purchase Agreement by a certified or bank cashier' s check or checks or wire transfer payable in immediately available funds to the order of the Corporation. Payment for the Bonds as aforesaid shall be made at the offices of Gust Rosenfeld, P.L.C. , "Bond Counsel" or such other place as shall have been mutually agreed upon by the Corporation and the Underwriter. (b) Delivery of the Bonds shall be made through the facilities of The Depository Trust Company, New York, New York. The Bonds shall be delivered in definitive fully registered form, bearing CUSIP numbers without coupons, with one Bond for each maturity of the Bonds, all as provided in the Third Supplemental Indenture, and shall be made available to the Underwriter at least one business day before the Closing for purposes of inspection. 6 . Closing Conditions. The Underwriter has entered into this Bond Purchase Agreement in reliance upon the representations, warranties and covenants of the Corporation contained herein and to be contained in the documents and instruments to be delivered at the Closing and upon the performance by the Corporation of its obligations hereunder, both as of the date hereof and as of the date of the Closing. Accordingly, the Underwriter' s obligations under this Bond Purchase Agreement to purchase, to accept delivery of and to pay for the Bonds shall be conditioned upon the performance by the Corporation of its obligations to be performed hereunder and under such documents and instruments, and the performance by the Town of its obligations to be performed hereunder and under the Letter of Representation and under such documents and instruments, at or prior to the Closing, and shall also be subject to the following additional conditions, including the delivery by the Corporation and the Town of such documents as are enumerated herein, in form and substance reasonably satisfactory to the Underwriter: (a) The representations and warranties of the Corporation contained herein and of the Town in the Letter of Representation shall be true, complete and correct on the date hereof and on and as of the date of the Closing, as if made on the date of the Closing; (b) The Corporation and the Town each shall have performed and complied with all agreements and conditions required by this Bond Purchase Agreement to be performed or complied with by it prior to or at the Closing; (c) At the time of the Closing, (i) the Corporation Documents, the Town Documents and the Bonds shall be in full force and effect in the form heretofore approved by the Underwriter and shall not have been amended, modified or supplemented, and the Official Statement shall not have been supplemented or amended, except in any 9 such case as may have been agreed to by the Underwriter, and (ii) all actions of the Corporation and of the Town required to be taken by the Corporation shall be performed in order for Bond Counsel and Greenberg Traurig, LLP, "Counsel to the Underwriter, " to deliver their respective opinions referred to hereafter; (d) At the time of the Closing, all official action of the Corporation relating to the Bonds and the Corporation Documents and all official action of the Town relating to the Town Documents shall be in full force and effect and shall not have been amended, modified or supplemented; (e) At or prior to the Closing, the Corporation Documents shall have been duly executed and delivered by the Corporation, the Town Documents shall have been duly executed by the Town, and the Corporation shall have duly executed and delivered, and the Trustee shall have duly authenticated, the Bonds; (f) At or prior to the Closing, the Bond Insurance Policy shall have been duly executed, issued and delivered by the Bond Insurer; (g) At the time of the Closing, there shall not have occurred any change or any development involving a prospective change in the condition, financial or otherwise, or in the revenues or operations of the Town, from that set forth in the Official Statement that in the judgment of the Underwriter, is material and adverse and that makes it, in the judgment of the Underwriter, impracticable to market the Bonds on the terms and in the manner contemplated in the Official Statement; (h) Neither the Corporation nor the Town shall have failed to pay principal or interest when due on any of its outstanding obligations for borrowed money; (i) All steps to be taken and all instruments and other documents to be executed, and all other legal matters in connection with the transactions contemplated by this Bond Purchase Agreement shall be reasonably satisfactory in legal form and effect to the Underwriter; (j ) At or prior to the Closing, the Underwriter shall have received copies of each of the following documents : (1) the Official Statement, and each supplement or amendment thereto, if any, executed on behalf of the Corporation by its President and on behalf of the Town by its Mayor, or such other officials as may have been agreed to by the Underwriter, and the reports and audits referred to or appearing in the Official Statement; (2) the Corporation Documents and the Town Documents with such supplements or amendments as may have been agreed to by the Underwriter as well as a specimen of the Bonds and the resolutions of 10 the Mayor and Council of the Town and the Board of Directors of the Corporation approving the same; (3) the approving opinion of Bond Counsel with respect to the Bonds, in substantially the form attached to the Official Statement; (4) a supplemental opinion of Bond Counsel addressed to the Underwriter, substantially to the effect that: (i) the Corporation Documents and the Town Documents have each been duly approved and the execution and deliver thereof duly authorized by all necessary actions and are each in full force and effect and are legal, valid and binding obligations of the respective parties thereto; (ii) the Bonds are exempted securities under the Securities Act of 1933, as amended (the "1933 Act") , and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and it is not necessary, in connection with the offering and sale of the Bonds, to register the Bonds under the 1933 Act or to qualify the Indentures under the Trust Indenture Act; (iii) the statements and information contained in the Official Statement on the cover page thereof, under the captions "INTRODUCTORY STATEMENT, " "THE SERIES 2003 BONDS, " "PLAN OF REFUNDING, " "SECURITY FOR AND SOURCES OF PAYMENT OF THE SERIES 2003 BONDS, " "LEGAL MATTERS, " "TAX EXEMPTION, " "BOND PREMIUM, " "ORIGINAL ISSUE DISCOUNT, " "POLITICAL CONTRIBUTIONS, " "RELATIONSHIPS AMONG PARTIES" and "CONTINUING DISCLOSURE" therein and in APPENDIX D - "SUMMARIES OF THE PRINCIPAL DOCUMENTS, " APPENDIX E - "FORM OF APPROVING LEGAL OPINION" and APPENDIX F - "FORM OF CONTINUING DISCLOSURE CERTIFICATE" thereto fairly and accurately summarized the matters purported to be summarized therein; and (iv) based on the examinations which they have made as Bond Counsel and their participation at conferences at which the Official Statement was discussed, but without having undertaken to determine independently the accuracy or completeness of the statements in the Official Statement other than those described in subparagraph (iii) of this subsection above, such counsel has no reason to believe that the Official Statement as of its date and as of the date hereof contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading (except for any financial, forecast, technical and statistical data included in the Official Statement and except for information regarding the Bond Insurer, in each case as to which no view need be expressed) ; (5) an opinion, dated the date of the Closing and addressed to the Underwriter, of Counsel to the Underwriter, to the effect that based upon their participation in the preparation of the Official Statement as Counsel to the Underwriter and their 11 participation at conferences at which the Official Statement was discussed, but without having undertaken to determine independently the accuracy, completeness or fairness of the statements contained in the Official Statement, such counsel has no reason to believe that the Official Statement contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading (except for (a) any financial, forecast, technical and statistical statements and data included in the Official Statement and the information regarding the Bond Insurer and (b) the statements and information contained in the Official Statement on the cover page and under the captions and in the appendices described in subparagraph 4 (iii) above, in each case as to which no view need be expressed) ; (6) an opinion of counsel to the Corporation and the Town, addressed to the Underwriter, to the effect that : (i) the Corporation is a nonprofit corporation, duly incorporated, organized and existing under the laws of the State, and has full legal right, power and authority (A) to enter into, execute and deliver the Corporation Documents, (B) to sell, issue and deliver the Bonds to the Underwriter as provided herein, and (C) to carry out and consummate the transactions contemplated by the Corporation Documents and the Official Statement, and the Corporation has complied, and will at the Closing be in compliance in all respects, with the terms of the Corporation Documents as they pertain to such transactions; (ii) the Town is a municipal corporation, duly incorporated, organized and existing under the laws of the State, and has full legal right, power and authority (A) to enter into, execute and deliver the Town Documents and (B) to carry out and consummate the transactions contemplated by the Town Documents, and the Official Statement, and the Town has complied, and will at Closing be in compliance in all respects, with the terms of the Town Documents as they pertain to such transactions; (iii) by all necessary official action of the Corporation prior to or concurrently with the acceptance hereof, the Corporation has duly authorized all necessary action to be taken by it for (A) the approval, execution and delivery of, and the performance by the Corporation of the obligations on its part, contained in the Bonds and the Corporation Documents and (B) the consummation by it of all other transactions contemplated by the Official Statement and the Corporation Documents; (iv) by all necessary official action of the Town prior to or concurrently with the acceptance hereof, the Town has duly authorized all necessary action to be taken by it for (A) the approval execution and delivery of, and performance by the Town of the obligations on its part, contained in the Town Documents, and (B) the consummation by it of all of the transactions contemplated by the Town Documents and the Official Statement; 12 (v) all proceedings pertinent to the validity and enforceability of the Bonds and all actions necessary to levy and collect the Excise Taxes securing the payment of principal and interest on the Bonds have been duly and validly adopted or undertaken in compliance with all applicable procedural requirements of the Corporation and the Town and in compliance with the Constitution and laws of the State; (vi) the Corporation Documents have been duly authorized, executed and delivered by the Corporation, and constitute legal, valid and binding obligations of the Corporation enforceable against the Corporation in accordance with their respective terms, except to the extent limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws and equitable principles of general application relating to or affecting the enforcement of creditors ' rights; (vii) the Town Documents have been duly authorized, executed and delivered by the Town, and constitute legal, valid and binding obligations of the Town enforceable against the Town in accordance with their respective terms, except to the extent limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws and equitable principles of general application relating to or affecting the enforcement of creditors ' rights; (viii) the distribution, use and execution, as applicable, of the Preliminary Official Statement and the Official Statement has been duly authorized by the Corporation and the Town and the Official Statement, as it relates to the Town and the Corporation, does not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading; (ix) all authorizations, approvals, licenses, permits, consents and orders of any governmental authority, legislative body, board, agency or commission having jurisdiction of the matter which are required for the due authorization of, which would constitute a condition precedent to, or the absence of which would materially adversely affect the due performance by the Corporation of its obligations under the Corporation Documents and the Bonds or by the Town of its obligations under the Town Documents have been obtained; (x) there is no legislation, action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government agency, public board or body, pending or, to the best knowledge of the signer, after due inquiry threatened against the Corporation, affecting the corporate existence of the Corporation or the titles of its officers to their respective offices, or to the best knowledge of the signer, after due inquiry, threatened against the Town or affecting the titles of its officers to their respective offices, or affecting or seeking to prohibit, restrain or enjoin the 13 sale, issuance or delivery of the Bonds or the levy and collection of the Excise Taxes securing the payment of principal of and interest on the Bonds pursuant to the Indentures or in any way contesting or affecting the validity or enforceability of the Bonds, the Corporation Documents, the Town Documents, or contesting the exclusion from gross income of interest on the Bonds for federal income tax purposes or State income tax purposes, or contesting in any way the completeness or accuracy of the Preliminary Official Statement or the Official Statement or any supplement or amendment thereto, or contesting the powers of the Corporation or any authority for the issuance of the Bonds or the execution and delivery of the Corporation Documents or contesting the power of the Town to execute and deliver the Town Documents, nor, to the best knowledge of the signer, after due inquiry, is there any basis therefor, wherein an unfavorable decision, ruling or finding would materially adversely affect the validity or enforceability of the Bonds, or the Corporation Documents, or to the knowledge of the Town, the Town Documents; (xi) the execution and delivery of the Corporation Documents and compliance by the Corporation with the provisions hereof and thereof, under the circumstances contemplated herein and therein, will not conflict with or constitute on the part of the Corporation a material breach of or a default under any agreement or instrument to which the Corporation is a party, or violate any existing law, administrative regulation, court order, or consent decree to which the Corporation is subject; and (xii) the execution and delivery of the Town Documents and compliance by the Town with the provisions thereof, under the circumstances contemplated therein, will not conflict with or constitute on the part of the Town a material breach or a default under any agreement or instrument to which the Town is a party, or violate any existing law, administrative regulation, court order, or consent decree to which the Town is subject; (7) a certificate, dated the date of Closing, of appropriate representatives of the Corporation to the effect that (i) the representations and warranties of the Corporation contained herein are true and correct in all material respects on and as of the date of the Closing as if made on the date of Closing all the agreements and covenants have been complied with and all the conditions satisfied which on its part were to be complied with be performed or satisfied at or prior to, and to the extent possible before, the Closing; (ii) no litigation or proceeding is pending or, to the best knowledge of the signer (s) after due inquiry, threatened in any court or administrative body nor is there a basis for litigation which would a) contest the right of the members or officials of the Corporation to hold and exercise their respective positions, (b) contest the due incorporation, organization and valid existence of the Corporation, c) contest the validity, due authorization and execution of the Bonds or the Corporation Documents or (d) attempt to limit, enjoin or otherwise restrict or prevent the Corporation from functioning and collecting Rental Payments under the Corporation Documents, and other 14 income; (iii) the resolutions of the Corporation authorizing the execution, delivery and/or performance of the Official Statement, the Bonds and the Corporation Documents have been duly adopted by the Corporation, are in full force and effect and have not been modified, amended or repealed, and (iv) to the best knowledge of the signer (s) , after due inquiry, no event has occurred since the date of the Official Statement which should be disclosed in the Official Statement for the purpose for which it is to be used or which it is necessary to disclose therein in order to make the statements and information therein, in light of the circumstances under which made, not misleading in any respect as of the time of Closing, and the information contained in the Official Statement is correct in all material respects and, as of the date of the Official Statement did not, and as of the date of the Closing does not, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements made therein, in the light of the circumstances under which they were made, not misleading; (8) a certificate, dated the date of Closing, of appropriate representatives of the Town to the effect that (i) the representations and warranties of the Corporation contained herein are true and correct in all material respects on and as of the date of the Closing as if made on the date of the Closing all the agreements and covenants have been complied with and all the conditions satisfied which on its part were to be complied with be performed or satisfied at or prior to, and to the extent possible before, the Closing; (ii) no litigation or proceeding against it is pending or, to the best knowledge of the signer (s) after due inquiry, threatened in any court or administrative body nor is there a basis for litigation which would (a) contest the right of the officials of the Town to hold and exercise their respective positions, (b) contest the due incorporation, organization and valid existence of the Town, (c) contest the validity, due authorization and execution of the Town Documents, or (d) attempt to limit, enjoin or otherwise restrict or prevent the Town from functioning and collecting revenues, including the collection of the Excise Taxes securing the payment of the principal of and interest on the Bonds; (iii) the resolutions of the Town authorizing the execution, delivery and/or performance of the Town Documents have been duly adopted by the Town, are in full force and effect and have not been modified, amended or repealed, and (iv) to the best knowledge of the signer (s) , after due inquiry, no event has occurred since the date of the Official Statement which should be disclosed in the Official Statement for the purposes for which it is to be used or which is necessary to disclose therein in order to make the statements and information therein, in light of the circumstances under which made, not misleading in any respect as of the time of Closing, and the information contained in the Official Statement is correct in all material respects and, as of the date of the Official Statement did not, and as of the date of the Closing does not, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements 15 made therein, in the light of the circumstances under which they were made, not misleading; (9) a certificate, dated the date of Closing, of appropriate representations of the Town and the Corporation in form and substance satisfactory to Bond Counsel and Counsel to the Underwriter (b) setting forth the facts, estimates and circumstances in existence on the date of the Closing, which establish that it is not expected that the proceeds of the Bonds will be used in a manner that would cause the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended (the "Code" ) , and any applicable regulations (whether final , temporary or proposed) , issued pursuant to the Code, and (c) certifying that to the best of the knowledge and belief of the Corporation and the Town there are no other facts, estimates or circumstances that would materially change the conclusions, representations and expectations contained in such certificate; (10) a certificate, dated the date of Closing, of the Trustee and the Depository Trustee to the effect that (i) the Bonds have been duly authenticated by an authorized officer of the Trustee; (ii) the Third Supplemental Indenture and the Depository Trust Agreement have been duly executed and delivered by an authorized officer of the Trustee and the Depository Trustee, respectively; and (iii) the resolutions of the Trustee and the Depository Trustee authorizing the execution and delivery and/or performance of the Third Supplemental Indenture by the Trustee and the Depository Trust Agreement by the Depository Trustee, respectively, have been duly adopted by the Trustee and the Depository Trustee, respectively, are in full force and effect and have not been modified, amended or repealed; (11) the filing copy of the Report of Bond and Security Issuance Pursuant to A.R.S . § 35-501B of the Arizona Department of Revenue for the Bonds; (12) the filing copy of the Information Return Form 8038-G (IRS) for the Bonds; (13) evidence that Standard & Poor' s Ratings Services, a division of the McGraw-Hill Companies, and Fitch Ratings have issued ratings of "AAA" and "AAA" , respectively, for the Bonds based on issuance of the Bond Insurance Policy and underlying, uninsured ratings of "A" and "A+" , respectively, for the Bonds (collectively, the "Ratings") , and that the Ratings are then in effect; (14) a copy of the Bond Insurance Policy together with an opinion of counsel to the Bond Insurer in form and substance satisfactory to the Underwriter; (15) a certificate of Bond Insurer with respect to the accuracy of statements contained in the Official Statement regarding 16 the Bond Insurance Policy and Bond Insurer and the due authorization execution issuance and delivery of the Bond Insurance Policy; (16) any other certificates and opinions required by the Indentures for the issuance thereunder of the Bonds; and (17) such additional legal opinions, certificates, instruments and other documents as the Underwriter or Counsel to the Underwriter may reasonably request to evidence the troth and accuracy, as of the date hereof and as of the date of the Closing, of the Corporation' s representations and warranties contained herein and of the Town' s representations and warranties in the Letter of Representation and of the statements and information contained in the Official Statement and the due performance or satisfaction by the Corporation and the Town on or prior to the date of the Closing of all the respective agreements then to be performed and conditions then to be satisfied by the Corporation and the Town, respectively; All of the opinions, letters, certificates, instruments and other documents mentioned above or elsewhere in this Bond Purchase Agreement shall be deemed to be in compliance with the provisions hereof if, but only if, they are in form and substance satisfactory to the Underwriter. If the Corporation shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds contained in this Bond Purchase Agreement, or if the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds shall be terminated for any reason permitted by this Bond Purchase Agreement, this Bond Purchase Agreement shall terminate and neither the Underwriter nor the Corporation shall be under any further obligation hereunder, except that the respective obligations of the Corporation and the Underwriter set forth in Sections 4 and 8 (c) hereof shall continue in full force and effect . 7 . Termination. The Underwriter shall have the right to cancel its obligation to purchase the Bonds if, between the date of this Bond Purchase Agreement and the Closing, the market price or marketability of the Bonds shall be materially adversely affected, in the sole judgment of the Underwriter, by the occurrence of any of the following: (a) legislation shall be enacted by or introduced in the Congress of the United States or recommended to the Congress for passage by the President of the United States, or the Treasury Department of the United States or the Internal Revenue Service or any member of the Congress or the Arizona Legislature or favorably reported for passage to either House of the Congress by any committee of such House to which such legislation has been referred for consideration, a decision by a court of the United States or of the State or the United States Tax Court shall be rendered, or an order, ruling, regulation (final, temporary or proposed) , press release, 17 statement or other form of notice by or on behalf of the Treasury Department of the United States, the Internal Revenue Service or other governmental agency shall be made or proposed, the effect of any or all of which would be to impose, directly or indirectly, federal income taxation or State income taxation upon interest received on obligations of the general character of the Bonds or, with respect to State taxation, of the interest on the Bonds as described in the Official Statement, or other action or events shall have transpired which may have the purpose or effect, directly or indirectly, of changing the federal income tax consequences or State income tax consequences of any of the transactions contemplated herein; (b) legislation introduced in or enacted (or resolution passed) by the Congress or an order, decree, or injunction issued by any court of competent jurisdiction, or an order, ruling, regulation (final, temporary, or proposed) , press release or other form of notice issued or made by or on behalf of the Securities and Exchange Commission, or any other governmental agency having jurisdiction of the subject matter, to the effect that obligations of the general character of the Bonds, including any or all underlying arrangements, are not exempt from registration under or other requirements of the 1933 Act, or that the Indentures are not exempt from qualification under or other requirements of the Trust Indenture Act, or that the issuance, offering, or sale of obligations of the general character of the Bonds, including any or all underlying arrangements, as contemplated hereby or by the Official Statement or otherwise, is or would be in violation of the federal securities law as amended and then in effect; (c) any state blue sky or securities commission or other governmental agency or body shall have withheld registration, exemption or clearance of the offering of the Bonds as described herein, or issued a stop order or similar ruling relating thereto; (d) a general suspension of trading in securities on the New York Stock Exchange or the American Stock Exchange, the establishment of minimum prices on either such exchange, the establishment of material restriction (not in force as of the date hereof) upon trading securities generally by any governmental authority or any national securities exchange, a general banking moratorium declared by federal, State of New York, or State officials authorized to do so; (e) the New York Stock Exchange or other national securities exchange or any governmental authority, shall impose, as to the Bonds or as to obligations of the general character of the Bonds, any material restrictions not now in force, or increase materially those now in force, with respect to the extension of credit by, or the charge to the net capital requirements of, underwriters; (f) any amendment to the federal or state Constitution or action by any federal or state court, legislative body, regulatory body, or other authority materially adversely affecting the tax status 18 of the Corporation, its property, income securities (or interest thereon) , or the validity or enforceability of the assessments or the levy of taxes to pay principal of and interest on the Bonds; (g) any event occurring, or information becoming known which, in the judgment of the Underwriter, makes untrue in any material respect any statement or information contained in the Official Statement, or has the effect that the Official Statement contains any untrue statement of material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (h) there shall have occurred since the date of this Bond Purchase Agreement any materially adverse change in the affairs or financial condition of the Corporation or the Town; (i) the United States shall have become engaged in hostilities which have resulted in a declaration of war or a national emergency or there shall have occurred any other outbreak or escalation of hostilities or a national or international calamity or crisis, financial or otherwise; (j ) any fact or event shall exist or have existed that, in the Underwriters judgment, requires or has required an amendment of or supplement to the Official Statement; (k) there shall have occurred any downgrading, or any notice shall have been given of (A) any intended or potential downgrading or (B) any review or possible change that does not indicate a possible upgrade, in the rating accorded any of the Corporation' s obligations; (1) United States Treasury Certificate of Indebtedness, Notes or Bonds-State and Local Government Series or acceptable open market securities shall be unavailable for purchase and/or delivery in the amounts, maturities and prices or yields required pursuant to the Depository Trust Agreement or (m) the purchase of and payment for the Bonds by the Underwriter, or the resale of the Bonds by the Underwriter, on the terms and conditions herein provided shall be prohibited by any applicable law, governmental authority, board, agency or commission. 8 . Expenses. (a) The Underwriter shall be under no obligation to pay, and the Corporation shall pay, any expenses incident to the performance of the Corporation' s obligations hereunder, including, but not limited to (i) the costs for initial delivery of the Bonds through the facilities of The Depository Trust Company, (ii) the fees and disbursements of Bond Counsel, Counsel to the Underwriter and Counsel to the Corporation and the Town; (iii) the fees and disbursements of 19 the Trustee and any other engineers, accountants, and other experts, consultants or advisers retained by the Corporation; (iv) reimbursement of certain out-of-pocket expenses of the Underwriter customarily paid by the Corporation, including advertisement in local media, and (v) the fees for bond ratings and credit enhancement fees or premiums . (b) The Underwriter shall pay (i) all advertising expenses placed in non-local media by the Underwriter in connection with the public offering of the Bonds; and (ii) all other expenses incurred by them in connection with the public offering of the Bonds, except the fees and disbursements of Counsel to the Underwriter. (c) If this Bond Purchase Agreement shall be terminated by the Underwriter because of any failure or refusal on the part of the Corporation to comply with the term or to fulfill any of the conditions of this Bond Purchase Agreement, or if for any reason the Corporation shall be unable to perform its obligations under this Bond Purchase Agreement, the Corporation will reimburse the Underwriter for all out-of-pocket reasonably incurred by the Underwriter in connection with this Bond Purchase Agreement or the offering contemplated hereunder. 9 . Notices. Any notice or other communication to be given to the Corporation under this Bond Purchase Agreement may be given by delivering the same in writing to the Town of Oro Valley Municipal Property Corporation, 11000 North La Canada Drive, Oro Valley, Arizona 85737, and any notice or other communication to be given to the Underwriter under this Bond Purchase Agreement may be given by delivering the same in writing to Stone & Youngberg LLC, Suite 280 , 2555 East Camelback Road, Phoenix, Arizona 85016, Attention: Mark Reader, Director. 10 . Parties in Interest. This Bond Purchase Agreement as heretofore specified shall constitute the entire agreement between us and is made solely for the benefit of the Corporation, the Town and the Underwriter (including successors or assigns of the Underwriter) and no other person shall acquire or have any right hereunder or by virtue hereof . This Bond Purchase Agreement may not be assigned by the Corporation. All of the Corporation' s representations, warranties and agreements contained in this Bond Purchase Agreement shall remain operative and in full force and effect, regardless of (i) any investigations made by or on behalf of any of the Underwriter; (ii) delivery of and payment for the Bonds pursuant to this Bond Purchase Agreement; and (iii) any termination of this Bond Purchase Agreement . 11. Effectiveness. This Bond Purchase Agreement shall become effective upon the acceptance hereof by the Corporation and shall be valid and enforceable at the time of such acceptance. As required by the provisions of Section 38-511 , Arizona Revised Statutes, as amended, notice is hereby given that the State, its political subdivisions (including the Town) or any department or agency of either may, within three years after its execution, cancel any 20 contract, without penalty or further obligation, made by the State, its political subdivisions, or any of the departments or agencies of either if any person significantly involved in initiating, negotiating, securing, drafting or creating the contract on behalf of the State, its political subdivisions, or any of the departments or agencies of either is, at any time while the contract or any extension of the contract is in effect, an employee or agent of any other party to the contract in any capacity or a consultant to any other party of the contract with respect to the subject matter of the contract . The cancellation shall be effective when written notice from the Governor or the chief executive officer or governing body of the political subdivision is received by all other parties to the contract unless the notice specifies a later time. The State, its political subdivisions or any department or agency of either may recoup any fee or commission paid or due to any person significantly involved in initiating, negotiating, securing, drafting or creating the contract on behalf of the State, its political subdivisions or any department or agency of either from any other party to the contract arising as the result of the contract . This section is not intended to expand or enlarge the rights of the Town hereunder except as required by such Section. Each of the parties hereto hereby certifies that it is not presently aware of any violation of such Section which would adversely affect the enforceability of this Agreement and covenants that it shall take no action which would result in a violation of such Section. 12 . Choice of Law. This Bond Purchase Agreement shall be governed by and construed in accordance with the law of the State. 13 . Severability. If any provision of this Bond Purchase Agreement shall be held or deemed to be or shall, in fact, be invalid, inoperative or unenforceable as applied in any particular case in any jurisdiction or jurisdictions, or in all jurisdictions because it conflicts with any provisions of any Constitution, statute, rule of public policy, or any other reason, such circumstances shall not have the effect of rendering the provision in question invalid, inoperative or unenforceable in any other case or circumstance, or of rendering any other provision or provisions of this Bond Purchase Agreement invalid, inoperative or unenforceable to any extent whatever. 14 . Business Day. For purposes of this Bond Purchase Agreement, "business day" means any day on which the New York Stock Exchange is open for trading. 15 . Section Headings. Section headings have been inserted in this Bond Purchase Agreement as a matter of convenience of reference only, and it is agreed that such section headings are not a part of this Bond Purchase Agreement and will not be used in the interpretation of any provisions of this Bond Purchase Agreement . 16 . Counterparts. This Bond Purchase Agreement may be executed in several counterparts each of which shall be regarded as an original (with the same effect as if the signatures thereto and hereto were 21 v upon the same document) and all of which shall constitute one and the same document . 22 11/13/03 17:57 FAX • If you agree with the foregoing, please sign the enclosed counterpart of this Bond Purchase Agreement and return it to the Underwriters . This Bond Purchase ,Agreement shall become a binding agreement between you and the Underwriters when at least the of this letter shall have been signed by or on behalf of counterpart each of the parties hereto and the Letter of Representation shall have been signed on behalf of the Town. Very truly yours, STONE - OUNGBERG -C /2 I i,, 1 r, . l. B ill. . . . . 4 . . . :2 Authorized Officer if "L 40 Accepted and agreed to this / i 13th day of November, 2003 TOWN OF ORO VALLEY MUNICIPAL PROPERTY CORPORATION __ / J // 6 ) 1~y Name: StPphei II. J i as Title: . PRESIDENT - - 14083292-11/1312003 23