HomeMy WebLinkAbout1989
4
C.
ULBRIG T & JA
KI
1301 CKI EY
HOUsTONI XAS 010
/ HOUSTON
TELEPHONE, 713/861- 61 WASHINGTON, O.C.
' TELC%: 78- 61
TELECOpIER: Y13/8 82l- /_6248 (Z/V1/I~J AUSTIN
e SAN ANTONIO
OALLAS
4CH
LONDON
IUA
PULSAIGHT JAWOASKI 6
HEAVES MCGRATH
NEW YORK
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March 1, 1989 LOS ANGELES
Re, Sur US Funds of the Corporation
Denton County Housing Finance
Corporation
Denton County Courthouse I
Denton County, Texas
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Ladies and Gentlemen,
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that we At the meeting of January 12, 1
review generall 989, You had requested
surplus funds Of the DentonyCountpower and authority p oration
(the "CDrporatlott11), We have Y reHousin
v ewed Finance Corporation
Incorporation dated January 14, 1980 the Articles
of
the
Corporation, its Bylaws (the 'By lams"), the and "Art the ictes Texas housing
Finance Corporations Ac,~, Texas Local Governmeat Code cha te
a 394 (the "Act under which the p s
incorporated, This letter does not address orfunds ioof the
Corporation which may be subject to liens
l Or otherwise encumbered, contract provisions,
The Articles state that the Corporation is a
instrumentalit public
Y and non-profit corporation organized solely to
carry out the purposes of
Corporations Act, and that the affthe
airs ofxtfhe Housing Finance
be managed by a Board of Directors to be composed fi0n shall
y appointed by the governing body of Denton County, Texas, The
Articles further state that no dividends shall be paid by the
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Corporation, and no part of its net earnings (beyond that
necessary for retirement of the indebtedness of the Corporation
or to implement the public purpose of the County for which the
Corporation has been created) shall be distributed to or inure
to the benefit of its directors or officers or any private
person, firm, corporation, or association except in reasonable
amounts for services rendered. No substantial part of the
Corporation's activities shall be carrying on propaganda or
otherwise attempting to influence legislation, and it shall not
participate in, or intervene in (including the publishing or
distributing statements), any political campaign on behalf of
or in opposition to any candidate for public office.
The Bylaws state that the Corporation shall have all
the powers conferred by the Articles and the Act, and the
exercise of any or all powers granted thereunder may be made by
/ resolution of the Board of Directors of the Corporation, The
1 Bylaws state the Directors may be reimbursed for actual
expenses incurred in the performance of their duties. The
Bylaws repeat that no dividends shall be paid and no part of
I the net earnings of the corporation shall ever be paid to any
private person except in reasonable amounts for services
rendered, The Bylaws further state that if the Board of
Directors of the Corporation determines that sufficient
provision has been made for full payment of its ,expenses,
j bonds, and other obligations, then its net earnings thereafter
1 accruing are to be paid to Denton County, Texas, provided that
nothing in the Bylaws shall prevent the Board of Directors of
the Corporation from transferring all or any part of its
property in accordance with the terms of any contract or
agreement, The Bylaws state that upon dissolution of the
Corporation, title to all its funds and property shall vest in
I Denton County, Texas.
The Act provides that the Corporation may not pay
t dividends, and that its net earnings may not be distributed to
or benefit the directors or officers of the Corporation or any
1 person except as reasonable compensation for services
rendered. Upon provision being made for a full payment of the
Corporation's expenses, bonds, and other obligations, any net
corporate earnings accruing after such provision shall be paid
to the sponsoring governmental body (i.e., Denton County,
Texas), The Corporation may transfer corporate property as
provided by a contract made by the Corporation,
The Act further states that the Corporation may
exercise any powers incidental to or necessary for the
performance of its; powers under the Act, and may exercise other
powers necessary or appropriate to carry out the purposes for
which the Corporation is organized. Among the Corporation's
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general powers, the Corporation may make contracts as necessary
or convenient to exercise its powers; incur liabilities, borrow
money, issue notes, bo.ndF, and other obligations; sec,ire its
obligations by mortgages or pledges of its property,
franchises, and income; plan, research, study, develop, and
promote the establishment of residential development; and make
donations for the public welfare or for charitable, scientific,
or educational purposes.
Generally, we note the following concerning your
surplus funds:
1. Under the terms of the Act, to tlie extent you
intend to plan, research, study, develop, and promote the
establishment of residential development, there is a
j neee:,sary incidental power to carry out those purposes to
expend net income of the Corporation,
2. You may expend that income of the Corporation for
making donations for the public welfare or for charitable,
yeienti£ic, or educational purposes,
3. You may expend funds of the Corporation to the
extent such expenditure is incidental to or net.essary for
the performance of any powers of the Corporation gra,.ted
under Texas Local Government Code chapter 394,
4. Under Your Articles;,
~ the Bylaws, and the Act, you
may not pay dividends or distribute the net earnings o@ the
I Corporation to benefit the
~ directors Corporation or any other private or officers the
reasonable compensation for services rendered.
J 5. Upon sufficient provision for full payment of
1 expenses, bonds, and other obligations of the Corporation,
net earnings of the Corporation accruing after the
€ determination that such provision has been made are to be
paid to Denton County, Texas,
,
6, You may pay money to carry out provisions of a
contract made by the Corporation. It is within your
general powers to make contracts if a contract is necessary
or convenient to exercise powers granted to you under the
Act,
All matters discussed in this letter are general and
are Intended to provide the Board of Directors with guidance
j for consideration of specific expenditures, Please call if you
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March 1, 1989
Page 4
have further questions concerning your powers with respect to
surplus funds,
Very truly yours,
Nen Thomas
For the Firm
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March 13, 1960
RE'. Denton County mousina Fiaanae Corporation Collateraliaed
Loans-to-Lenders siouslng Revenue Sondoo esries 1061-A
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Denton county mousing Finance Corporation
Comissionor's precinct 4
Courthouse On The Square
Denton, Texas 76201
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Ladies ar.4 aentlemenl
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In connection with the issuance of the
above-referenced bonds (the "goads") of the Denton County
Housing Finance Corporation (the "issuer"), we rendered an
opinion to the effect that interest on the Bonds would be
excludable from the gross income of the owners thereof for
federal income tax purposes, The proceeds of the Bonds were
! loaned to certain financial institutions that re-loaned such
proceeds to developers of multifamilyy rental housing projects,
Yorth Texas savings and Loan Assoolatioa the "housing )
f was loaned a portion of the proceeds of the 9ondsl and the
Associatio>x re-loaned such proceeds to Fox Haven, Ltd,, a Texas
limited partnership (the "Developer"), to finance the
construction of a multifamily rental housing project, the
Haventree Apartments (the "nrojeat"). Out opinion was based in
f pact upon the asss~ti oetithat the to Developer, aid its successors
gne omply with the terms,
conditions cad restrictions contained its that certain
n Aequlatory Agreement, dated a• of Deomber A, 19x1, originally
aaong the issuer, The First Rational Hann of Tort worth (the
"Ornal Trustee"), and the Developer and with those certain
restrictions contained the Declaration of Ustriotivo
Covenants, Terms not otherwise defined herein shall have the
same meaning ascribed to such terms in the Regulatory Agrement,
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MAR :6 '69 10;Z! FULBRIGHT & JAWORSK2 DALLAS
P,3
r Denton County Housing M aace Corporation
March 13, 1999
Page 2
it is our understanding that on May 1, 1997, the
Association foreclosed upon its loan to the Developer, acquired
the Project and redeemed $4,330,000 of the Bonds. On may 1,
1997, an additional foreclosure resulted in the partial
redemption of 13,935,000 of the Bonds. Finally, on may 1,
finaaaial~institutiocns in prepaid
uaownt their
Of of;6# 40D 0000 which
financial institutions used such prepayments to redeem the
remaining outstanding Bonds,
requested that the The Association, as iu00essor to the Developer, has
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Of Restrictive covenants r And terminate that the release Issuer the Declaration
National Built Ft, worth, as successor to the original Trustee
(the "Truetee'l), release and terminate the Regulator
i greement. The Declaration of Restrictive Covenants and the
Regulatory Agreement may not be terminated unless an opinion of I
Band counsel is received to the effect that such termination
will not adversely affect the excludability of interest from
the gross income of the owners of the Bonds for federal income
talc purposes.
The restrictions contained in the Regulatory Agreement 1
and the Declaration of Restrictive Covenanta that are related
to federal income taxes are contained in Treasury Regulation
section 1,103-s(b), Treasury Regulation Section
1.103-A(b)(6>(ifi) providesi
(iii) involuntary loss. (a) The requirements
I of !Treasury Regulation Section 1,103-A(b)) shall
cases to apply to a project in the event of
involuntary noncompliance caused by firs, leisure,
requisition, foreclosure, ohaags in a Federal law or
an action of a Federal agonay attar the date of issue
which prevents an issuer from erjorcin the
requirements of this paragraph, or condemnation or
similar event but only if, within a reasonable period,
either the obligation used, to provide such project
is retired or amounts received as a consequence of
such event are used to provide a project which meets
the requirement of section 103(b)(O (A) and (Treasury
Regulation &action 1.103-6(b)l. (ftphasis added.)
(b) The provisions of paragraph
(b)(a)(iii)(a) of this section shall cease to a ply to
a project subject to forsclosure, transfer of title by
deed in lieu of foreclosure or similar event if, at
anytime during that part of the qualified project
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h'AR 16 '89 10;21 FLILBRIGHr & JAWORSX! DALLAS P.4
Denton County Mousing Finance Corpormtion
March 13, 1109
Page 3
period subsequent to such event, the obligor on tho
acquired purpose obligation (se defined in
91,103-13(b)(4)(iv)(a) or a related person (as defined
in 51,103-10(4)) obtains an ownership interest in such
project for tax purposes,
Since the Project was acquired by the Association in a
foreclosure !and that portion of the Bonds related to the
Profeot were retired, Treasury Regulation 1,103-8(b)(W iii)
would appear to allow the retttlotions contained in the
Regulatory Agreement and the Declaration of Restrictive
Covenants to be terminated without adversely affecting the
excludability of interest on the Bonds from the gross income of
the owners thereof for federal income tax purposed provided
that, the Developer or a related person (as defined in Treasury
Regulation Section 1,103-10(e)) does not obtain an Ownership
interest in the Project during the qualified project period (as
definoA in Treasury Regulation Section 1.103-8(b)(7)) for
federal income tax purposes,
The 2nternal Revenue Service (the "Service") in PUt
9743017 ruled privately in connection with a foreclosure of a
single project in a osctifioste of deposit program that
involved multiple financial institutions and multiple projects
and wee therefore similax to the Lo we-to-leaders program
financed by the Bonds, in PLA 9743073, the service ruled that
since the multiple projects were provided by a single issue of
bonds that Treasury Aequlatione Section 3,403-0(b)(6)(iii) was
not applicable, The Service relied upon the singular nature of
the word "obligation" in such Regulation, That is, the
requirement that "within a reasonable period the obligqation
used to provide such project is retired" could not be sstisfied
since the entire obligation was not retired in PLA 0743023.
However, in the situation considered hereunder, within one year
of the redemption of the portion of the Sonde related to the
Project, all the Bonds vere redeemed. This fact distinguishes
the present case from PLA 0743023,
agoiag, and assumin that the
Based on the for
Developer or a related person (as defined in Treasury
Regulation Section 1,103-10(6)) does not obtain as ownership
interest in the Project for federal income tax purposes during
the qualified project riod (as defined in Treasury Regulation
Section 1.103-8(b) 7)ro we ere of the opinion that the
termination and release of the Regulatory Agreement and the
Ueolaration of Restrictive Covenants will not adversely affect
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MAR lb 'QS '10122 FULBRIGHT R JAUORSKI,DALLAS,
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Denton Countp Housinq Finance Corporation
Harch 13, 1914
Page 4
the excludability of interest on the Bonds from the gross
iacoar of the oworn thnrnnf fnr Waal Anoone t" purpalse.
Vet ruly vaurs,
Pu right pia rski
t3eor cofi
For the Firm
whs/o.rt/31ebd ~
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cot Kr. elbert M. Morrow (Vim)
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RESOLUTIONS AMENDING AND RATIFYING
RESOLUTIONS AUTHORIZING
DENTON COUNTY HOUSING FINANCE CORPORATION
SINGLE FAMILY MORTGAGE REVENUE BONDS
(GNMA MORTGAG2-BACKED SECURITIES PROGRAM) SERIES 1989;
A SINGLE FAMILY MORTGAGE PURCHASE PROGRAM (1989);
AND OTHER MATTERS IN CONNECTION THEREWITH
WHEREAS, this Denton County Housing Finance
Corporation (the "Issuer") passed and adopted RESOLUTIONS
AUTHORIZING DENTON COUNTY HOUSING FINANCE CORPORATION SINGLE
FAMILY MORTGAGE REVENUE BONDS (GNMA MORTGAGE-BACKED SECURITIES
PROGRAM) SERIES 1989; A SINGLE FAMILY MORTGAGE PURCHASE PROGRAM
(1989); AND OTHER MATTERS IN CONNECTION THEREWITH (the
"Resolutions") at a meeting of the Issuer held on March 6,
1989; and
WHEREAS, this Board of Directors has determined that
the action authorizing the Resolutions is in furtherance of the
f corporate purposes of the Issuer and that the terms and
conditions of the Bonds and other instruments described in the
Resolutions are advisable and that such action should be
affirmed and ratified except as provided herein;
j BE IT THEREFORE ?.ESOLVED BY THE BOARD OF DIRECTORS OF
THE DENTON COUNTY HOUSING FINANCE CORPORATION THAT,
Section 1, All actions authorized by this Board of
Directors in the Resolutions shall be and the same are
hereby ratified, approved, and confirmed except as provided
herein,
Section 2, The following documents, as approved b
this Board of Directors in the Resolutions and presented on
f this date, are approved in substantially the form as
presented to the Board in connection with these resolutions
(the "Amending Resolutions") on this date;
(i) The Origination, Sale, and 8ervicing
Agreement, dated as of February 15, 1989 (the
"Agreement"), among the Issuer, MBank Houston,
National Association, as Trustee (the "Trustee"),
Lomas Mortgage U.S.A., Inc, (the "Administrator"),
and the Participants approved to originate mortgage
loans thereunder;
(ii) The Indenture of Trust, dated as of
February 15, 1989 (the "Indenture"), between the
Issuer and the Trustee;
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The Letter of Represantations from the
Trustee and the Issuer to Depository Trust Company; and
(iv) The Purchase Contract, among First
Southwest Company, Prudential-Bache Capital Funding,
Inc., and Morgan Stanley & Co. Incorporated (tho
"Underwriters") and the Issuer.
Section 3. This Board of Directors hereby approves
and ratifies the Bonds in an amount not to exceed
$16,866,293,45 in substantially the form and substance set
forth in the Indenture, at the initial per annum rates of
interest and maturities as set forth in the amended
Schedule A attached hereto.
Section 4, All action (not inconsistent with
provisions of these Affirming Resolutions) and the
Resolutions heretofore taken by this Board of Directors and
the officers of the Issuer directed toward the issuance of
the Bonds and the financing of the Single Family Mortgage
Purchase Program (1989) (the "Program") shall be and the
same. hereby are ratified, approved, and confirmed., The
officers of this Board, or any of them, are authorized to
take any and all actions necessary to carry out and
consummate the transactions described in or contemplated by
the instruments approved hereby or otherwise to give effect
to the actions authorized hereby and the intent hereof.
Section 5, After any of the Bonds are issued, these
Affirming Resolutions and the Resolutions as modified
j hereby shall be and remain irrepealable until the Bonds or
interest thereon shall have been fully paid or provisions
i for payment shall have been made pursuant to the Indenture,
i Section 6. If any section, paragraph, clause, or
li provision of these Affirming Resolutions shall be held to
be invalid or unenforceable, the invalidity or
unenforceability of such section, paragraph, clause, or
provision shall not affect any of the remaining provisions
of these Affirming Resolutions, In case any .ibligation of r
the Issuer authorized or established by these Affirming
Resolutions or the Bonds is held to be in violation of law
as applied to any person or in any circumstance, such
obligation shall be deemed to be the obligation of the
Issuer to the fullest extent permitted by law.
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SCHEDULE A
TO BOND RESOLUTION
The Bonds, consisting of Serial Bonds, Term Bonds and
Capital Appreciation Bonds shall be of the maturities, amounts,
and per annum rates of interest as follows;
SERIAL BONDS
Maturity Principal Interest {
Date Amount _ Rate M
February 1, 1992 $125,000 7.20
August 1, 1992 130,000 7.20
February 1, 1993 135,000 7.30
August 1, 1993 140,000 1.30
February 1, 1994 145,000 7.40
August 1, 1994 150,000 7,40
February 1, 1995 155,000 7.45
August 1, 1995 160,000 7.45
~bruary 1, 1996 165,000 7.50
August 1, 1996 175,000 7,50
1 f February 1, 1997 1801000 7.55
August 1, 1997 185,000 7.55
February 1, 1998 195,000 7.65
August 1, 1998 200,000 7,65
? February 1, 1999 210,000 7.75
August 1, 1999 220,000 7,75
February 1, 2000 225,000 7.85
August 1, 2000 235,000 7,85
TERM BONDS
Maturity Principal Interest
Date Amount Rate $3
August 1, 2020 $4,000,000 7.75
I kk August 1, 2021 8,665,000 8.25
CAPITAL APPRECIATION BONDS
Maturity Maturity Interest
Date Amount Rate M
.
February 1, 2001 $245,000 8.00
August 1, 2001 245,000 8,00
February 1, 2002 245,000 8.00
August 1, 2002 245,000 8.00
February 1, 2003 245,000 8.00
August 1, 2003 245,000 8.00
February 1, 2004 245,000 8.00
August 1, 2004 250,000 8.00
February 1, 2005 250,000 8100
August 1, 2005 250400 8100
February 1, 2006 250400 8100
August 1, 2006 250,000 8100
February 1, 2007 250,000 8100
August 1, 2007 245,000 8100
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CERTIFICATE OF SECRETARY
THE STATE OF TEXAS §
COUNTY OF DENTON §
I, the undersigned, Secretary of the Denton County
Housing Fi,iance Corporation, a public non-profit corporation
organized by and with the approval of Denton County, Texas, DO
HEREBY CERTIFY as follows:
1. That on March 6, 1989, the Board of Directors of
the Denton County Housing Finance corporation (the "Board of
Directors") convened in special session at its regular meeting
place located at Commissioners Courtroom, Courthouse on the
Square, Denton, Texas; the members of the duly constituted
Board of Directors being as follows:
Mr, Don Hill President
f Mr, Mark Chew Vice President
Mr. Lloyd Harrell Secretary-Treasurer
Judge Vic Burgess Director
Ms, Diane Edmondson Director
Mr, Charles Hopkins Director
Mr, Jim Jenne Director
Ms, Lennie McAdams Director
Dr, Ray Stephens Director
Mrs, Lee Walker Director
and all of sad persons were p esent at said meeting except the
i I following: j9 Sojjd~L Ae mod" 4L"1
I Whereupon written:
RESOLUTIONS AUTHORIZING
DENTON COUNTY HOUSING FINANCE CORPORATION
SINGLE FAMILY MORTGAGE REVENUE BONDS
(GNMA MORTGAGE-BACKED SECURITIES PROGRAM) SERIES 1989;
A SINGLE FAMILY MORTGAGE PURCHASE PROGRAM (1989);
AND OTHER MATTERS IN CONNECTION THEREWITH
was introduced and submitted to the Board of Directors for
passage and adoption, After presentation and due consideration
of the resolutions, a motion was made and seconded that the
resolutions be finally passed and adopted. The motion carried
by the following vote:
k ' voted "For" U voted "Against" b abstained
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all as shown in the official minutes of the Board of Directors
for the meeting held on the aforesaid date,
2. That the attached resolutions are a true and
correct copy of the original on file in the official records of ,
the Denton County Housing Finance Corporation; the duly
qualified, acting, and incumbent members of the Board of
Directors on the date of the aforesaid meeting are those
persons shown above and, according to the records of my office,
each member of the Board of Directors was given advance notice
of the time, place, and purpose of the meeting; that said
meeting, and deliberation of the aforesaid public business, was
open to the public and notice of said meeting was given in
advance thereof on behalf of the secretary of the Issuer in
compliance with the provisions of the Bylaws of the Issuer; and
that said meeting was in all other respects duly called and
j held,
IN WITNESS WHEREOF, I have hereunto signed
officially and affixed the seal of the Denton Cunty Housname
ing
Finance Corporation this
Secret
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RESOLUTIONS AUTHORIZING
DENTON COUNTY HOUSING FINANCE CORPORATION
SINGLE FAMILY MORTGAGE REVENUE BONDS
(GNMA MORTGAGE-BACKED SECURITIES PROGRAM) SERIES 1989;
A SINGLE FAMILY MORTGAGE PURCHASE PROGRAM (1989);
AND. OTHER MATTERS IN CONNECTION THEREWITH
WHEREAS, the Denton County Housing Finance Corporation
(the "Issuer") has been created avid established as a public
nonprofit corporation pursuant to the provisions of the Texas
Housing Finance Corporations Act, as amended, Texas Local
Government Code chapter 394 (the "Act"), to finance the costs
of residential ownership and development that will provide
_ decent, safe, and sanitary housing at affordable prices for the
residents of Denton County, Texas (excluding portions of the
Cities of Carrolton and Dallas located therein, the "Unir");
WHEREAS, the Issuer has determined to
Implement a
Single Family Mortgage Purchase Program
(1989) (the
F' "Program") to assist persons of low and modern income to
acquire and own decent, safe, and sanitary housing within the
Unit;
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WHEREAS, the Issuer has determined to issue iCs Single
Family Mortgage Revei.ue Bonds (GNMA Mortgage-Backed Securities
Program) Series 1989 (the "Bonds"), in the aggregate
E principle amount of $16,866,293,45, to acquire fully modified
pass-through mortgage-backed certificates backed by certain
qualified home mortgage loans (the "Mortgage Loans") made to
persons of low and moderate income within the Unit and
guaranteed by the Government National Mortgage Association (the
"GNMA Certificates"), and to pay certain costs incurred in
' connection with the issuance of the Bonds and the
Implementation of the Program, all under and in accordance with
i the Constitution and laws of the State of Texas;
WHEREAS, it is hereby expressly determined that the
issuance of the Bonds and the implementation of the Program
accomplish a valid public, purpose of the Issuer by assisting
persons of low and modera'C9 income in the Unit to obtain
decent, safe, and sanitary housing, thereby helping to
eliminate slums in blighted areas, to relieve unemployment and
depressed economic conditions in the home construction
industry, to preserve and increase the tax base of the State of
Texas, the Unit, and other political subdivisions, and to
reduce public expenditures for crime prevention and control,
public health, welfare, and safety and for other purposes, and
the foregoing are hereby determined and declared to lessen the
burdens of government and to be public purposes and functions;
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WHEREAS, the Issuer is authorized to issue the Bonds
pursuant to the Act;
WHEREAS, section 103 and section 143 of the Internal
Revenue Code of 1986, as amended (the "Code"), provide that
if such obligations meet certain requirements stated in
sections 143, 147, 148, and 149 of the Code, then the interest
on obligations issued by or on behalf of a state or a political
subdivision thereof the proceeds of which are to be used to
finance owner-occupied residences shall be excludable from the
gross income of the owners thereof for federal income tax
purposes;
WHEREAS, the Issuer is a public instrumentality whose
_ creation was effected after the approval of the form of its
articles of incorporation, as amended, by resolution adopted by
the Commissioners Court of the Denton County, Texas (the
"Governing Body"), and it is hereby found and determined that:
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(1) the Issuer is the only authority created on
behalf of Denton County, Texas,• which has the power
to issue its revenue bonds to acquire home mortgages
i and by pledging such mortgages as security for the
payment of the principal of and interest on any such
revenue bonds and by entering into any agreements made
in connection therewith;
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(2) except for the Cities of Carrollton, Texas
and Dallas, Texas, each incorporated city located in
whole or in part within the boundaries of Denton
f County, Texas, having a population in excess of 20,000
as of January 1, 1989, has, by resolution of the
governing body of such of.ty, approved or will approve
prior to delivery of the Bonds the acquisition of home
mortgages within its boundaries as a part of the
program of the Issuer, and home mortgages may be
acquired with respect to homes located within the
Unit;
(3) the issuance of the Bonds and the making of
the various contractual commitments, as provided in
this Resolution, will finance the costs of residential
ownership and development that will provide decent,
i safe, and sanitary housing at affordable prices for
residents of the Eligible Loan Area at affordable
prices, and the issuance of the Bonds for the purposes
decribed in the Program is in the best interests of
the citizens of the Unit and accomplishes the public
purposes for which this Issuer was created and
established;
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provisions Hof Texas t Revised Issuer
Civil a Statutes complied article with
5190).9(a),
receiving a Certificate of Reservation, docket number 662,
dated February 1, 1989, (2) the relevant provisions of the
Code, and (3) all applicable laws of the State of Texas;
WHEREAS, First Southwest Company, Prudential-Bache
Capital Funding, Inc., and Morgan Stanley & Co, Incorporated
(collectively referred to as the "Underwriters") have offered
to purchase the Bonds and to such end have presented for
consideration by this Board of Directors a Preliminary official
Statement (the "Preliminary Official Statement") dated
February 24, 1989;
WHEREAS, a proposed Trust Indenture to be dated as of
February 15, (the "Indenture") , between the Issuer and
MTrust Corp, National Association, as trustee (hereinafter
referred to as the "Trustee"), which would establish terms
for and provide for the issuance of and security for the Bonds, JJ
a proposed Purchase Contract to be dated March 6, 1989 (the 1
"Purchase Contract"), between the Underwriters and the Issuer
providing for the sale of the Bonds to the Underwriters by this 1
Issuer, and a proposed Letter of Representations to be dated
the date of its execution by the Trustee (the "Letter of
Representations" from the Issuer and the Trustee to the
Depository Trust Company, have been presented for consideration;
i
WHEREAS, there has been presented for consideration by
this Board of Directors, the proposed Origination, Sale, and
Servicing Agreement to be dated as of February 15, 1989 (the
"Agreement"), separate but 'substantially similar originals of
which are to be entered into by the Issuer, the Trustee, Lomas
Mortgage USA, Inc .0 as master servicer (the "Administrator"),
and each of the Participants (hereinafter defined), which
f Agreement sets forth certain procedures and guidelines to be f
followed by the Issuer and it is appropriate for the Board of
Directors of the Issuer to approve the Agreement and thereby
also provide for the Trustee and the Administrator to
administer the Program and for the Administrator to monitor and
supervise the origination, sale, and servicing of the Mortgage
Loans;
WHEREAS, there has also been presented to this Board
of Directors the Invitation to Participate dated December 15,
1988 (the "invitation") relating to the Program
distributed to Persons previously
if Mortgage Loans under the Program tially interested in making
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WHEREAS, the Issuer also wishes to authorize and
approve the appointment of various parties to implement and
administer the Program and to authorize the selection of the
Persons who will be eligible to make Mortgage Loans (the
"Participants") under the Program and to authorize the
designation of the respectil', dollar amount to be made
available to each such Part'.cipant for Mortgage Loans (the
"Participant Allocation");
WHEREAS; this Board of Directors has reviewed the
foregoing and determined that the action herein authorized is
in furtherance of the corporate purposes of the Issuer and that
the terms and conditions of the Bonds and the above-.described
instruments, including without limitation the date, interest
rates, maturity, redemption terms, and sales price of the Bonds
and the manner of disbursing the proceeds thereof are advisable;
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF
DIRECTORS OF THE DENTON COUNTY HOUSING FINANCE CORPORATION,
THAT:
Section 1. All terms used herein, unless
otherwise e# ned, shall have the meanings ascribed
i
herein and in the Indenture or the Agreement.
Section 2. The terms of the Agreement, the
indenture, the Letter of Representations, and the
Purchase Contract, in substantially the forms and to
the effect presented to this Board of Directors be,
and the same hereby are, approved,
Section 3, The President and the Vice President,
i or either of them, and the Secretary and any Assistant
I Secretary, os any of them, be, and such officers
hereby are, authorized and directed to execute and
I deliver the Agreement, the Indenture, the Purchase
Contract, and any and all certificates and other
instruments described therein upon the conditions
therein described, all upon the terms herein, approved,
and that the President (and, in the event of the
absence or disability of such officer, the Vice
President) and the secretary (and, in the event of the
absence or disability of such officer, any Assistant
Secretary appointed by the President or the Vice
President for such purpose) be, and such officers
hereby are, authorized to negotiate and
approve changes in the terms of each such instrumenror to
the execution and delivery thereof) as such officers
shall deem necessary or appropriate, and that approval
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ofshalthebe
l terms o£ each such instrument by such officers
conclusively evidenced by their execution and
delivery thereof,
Section 4, This Board of Directors hereby
approves and ratifies the distribution of the
Invitation and the Preliminary Official Statement and
approves and authorizes distribution of an official
Statement and the President (arid, in the event of the
absence or disability of such officer, any Vice
President) is authorized to approve such changes and
supplements to the Preliminary official Statement and
Official Statement as such officer shall, on the
advice of counsel, deem necessary or appropriate and
to execute and deliver the same to the Underwriters,
which approval shall be conclusively evidenced by the
execution and delivery thereof by such officer,
Section 5, The Bonds, in a principal amount not
to exceed (16,866,293,45 in substantially the form and
j substance set forth in the Indenture, and at an
initial per annum rates of interest as set forth in
Schedule A attached hereto, are hereby approved and
the President and each Vice President, or any of them,
and the Secretary and each Assistant Secretary, or any
of them, are hereby authorized and directed, for and
E on behalf of the Issuer, to execute the Bonds or have
j their facsimile signatures placed upon the Bonds, and
I such officers are hereby authorized and directe to
the Bonds, and the seal 'of the Issuer is k
' hereby authorized and directed to be affixed or placed
in facsimile on the Bonds. Submission of a transcript
j of proceedings concerning the Bonds to the Attorney
General of the State of Texas, registration of the
Bonds by the Comptroller of Public Accounts of the
State of Texas, and authentication of the Bonds, all
upon the terms and condind the manner
f
described in the Indenture as the saame may be modified
as authorized by these Resolutions, and the delivery
of the Bonds against payment therefor ;
pursuant contract are hereby authorized,to the
Section Solely for I
the Program purposes of carrying out
maximum , the Issuer hereby determines that the e
amount to be set under the Act constituting
low and moderate income shall be #45,665,00 until such
amount may hereafter be revised by the Issuer,
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Section 7. MTrust Corp, National Association is
hereby appointed as Trustee under the Indenture,
thereby serving as Bond Registrar and paying agent
under the terms of the Indenture,
Section 8, The President and each Vice
President, or any of them, and the Secretary and each
Assistant Secretary, or any of them, are hereby
authorized to execute and deliver to the Trustee the
written request of the Issuer for the authentication
and delivery of the Bonds by the Trustee in accordance
with the Indenture.
Section 9, The use and distribution of the
Invitatio- n the form presented to the Board on this
date as the act and deed of the Issuer is hereby
ratified and confirmed,
Section 10, The use and distribution of the form
j of Offer to originate, in the form presented to the
Hoard on this date as the act and deed of the Issuer,
is hereby ratified and confirmed,, the acceptance of
each Participant's offer is hereby authorized, and the
President, Vice President, the Secretary and other
authorized member of the Issuer are each hereby
authorized to execute and deliver to each Participant
the Notice of Acceptance provided for in the
j Invitation.
Section 11, All action (not 'inconsistent with a g
provis one s of these Resolutions) heretofore taken by 1
i this Board of Directors and the officers of the Issuer
directed toward the financing of the Program and the t
issuance of the Bonds shall be and the same hereby is
ratified, approved, and confirmed. The officers of S
this Board, or any of them, are authorized to take any
and all action necessary to carry out and consummate
the transactions described in or contemplated by the
instruments approved hereby or otherwise to give
effect to the actions authorized hereby and the intent
1 hereof, and the President or Vice President, or any
duly authorized officer of the Issuer is hereby
authorized to approve such changes to the documents
authorized by this resolution as shall be deemed
necessary or appropriate and not contrary to the
general tenor thereof, and the e:;ecution and delivery
of such documents by the President,. the Vice
President, or any duly authorized officer of the
Issuer will constitute the approval by the Issuer of
any such changes,
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Section 12. No stipulation, obligation or
agreement herein contained or contained in the
Indenture, the Bonds, the Agreement, the offer, the
Invitation, the Preliminary Official Statement, the
Official Statement, the Purchase Contract or any other
instrument related to the issuance of the Bonds shall
be deemed to be a stipulation, obligation, or
agreement of any officer, director, agent, or employee
of the issuer in his or her individual capacity, and
no such officer, director, agent, or employee shall be
personally liable on the Bonds or be subject to
personal liability or accountability by reason of the
issuance thereof.
Section 13. The issuer hereby directs the
President, Vice President, the Secretary or other
authorized member of the Issuer to determine and
approve the Program Allocation for each Participant in
the amounts deemed appropriate by such officer or
authorized member,
Section 14. Lomas Mortgage USA, Inc. is hereby
appointed as master servicer under the Agreement.
t
Section 15. After any of the Bonds are issued,
these Resolutions shall be and remain irrepealable
until the Bonds or interest thereon shall have been
! I fully paid or provisions for payment shall have been
made pursuant to the Indenture,
Section 16, if any section, paragraph, clause,
or provisions of these Resolutions shall be held to be
invalid or unenforceable, the invalidity or
4 unenforceability of such section, paragraph, clause,
or provision shall not affect any of the remaining
provisions of these Resolutions, In case any
LJ obligation of the Issuer authorized or established by
I l these Resolutions or the Bonds is held to be in
violation of law as applied to any person or in any
circumstance, such obligation shall be deemed to be
the obligation of the Issuer to the fullest extent
permitted by law.
Section 17, This Bond Resolution shall be in
full foroe and effect immediately from and upon its
adoption,
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SCHEDULE A
TO BOND RESOLUTION
The Bonds, consisting of Serial Bonds, Term Bonds and
Capital Appreciation Bonds shall be of the maturities, amounts,
and per annum rates of interest as follows;
SERIAL BONDS
Maturity Principal Interest
Date Amount Rate
February 1, 1992 $125,000 7,20
August 1, 1992 130,000 7,20
February 1, 1993 135,000 7.30
August 1, 1993 140,000 7,30
February 1, 1994 145,000 7,40
August 10 1994 150,000 7.40
February 1, 1995 155,000 7.45
August 1, 1995 160,000 7,45
February 1, 1996 165,000 7,50
August 1, 1996 175,000 7.50
E February 1, 1997 180,000 7.55
August 1, 1997 185,000 7,55 {
February 1, 1998 195,000 7.65
I August 1, 1998 200,000 7.65
February 1, 1999 210,000 7,75
August 1, 1999 220,000 7.75
February 1, 2000 225,000 7.65
August 1, 2000 235,000 7,85
TERM BONDS
Maturity Principal Interest
Date Amount Rate
August 1, 2017 $4,000,000 7,75
August 1, 2021 81665,000 8.25
CAPITAL APPRECIATION BONDS
Maturity Maturity Interest
Date Amount Rate
February 11 2001 $245,000 8000
August 10 2001 245,000 8100 E
February 1, 2002 245,000 8100
August 1, 2002 245,000 8.00
February It 2003 245,000 8.00
August 1, 2003 245,000 8.00
February 11 2004 245,000 8.00
August It 2004 250,000 8.00
February 1, 2005 250,000 8.00
August 1, 2005 250,000 8,00
February 11 2006 250,000 8.00
August 1, 2006 250,000 8100
February It 2007 250,000 8.00
4 August 1, 2007 245,000 8,00
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EXTRACT FROM MINUTES OF MARCH 16, 1989
MEETING OF BOARD OF DIRECTORS OF
DENTON COUNTY HOUSING FINANCE CORPORATION
Director made a motion that the
letter from Fulbright & Jaworski relating to a Release of
Regulatory Agreement with respect to Fax Haven Ltd, Partners be
spread upon the minutes and that the President of the Board be
directed to execute the Release as presented to the Board by
such law firm, The motion was seconded by Director
and upon the vote being called for, the motion carried by
unanimous vote
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MINUTES OF MEETING OF BOARD OF DIRECTORS
MARCH 6, 1989
The State of Texas §
County of Denton §
Denton County Housing Finance Corporation §
The Board of Directors (the "Board"
County Housing Finance Corporation (the "Corporation") et Dention
the Commissioner's Courtroom, Courthouse on the Square, Denton,
Texas, at 6:30 p,m, on March 6, 1989. The following members of
the Board were present; Mr. Don Hill, Mr,
Judge Vic Burgess, Ms. Diane Edmondson, Ms, Mark , Lennie Chew
McAdams.
Also attending were Mr, Neil Thomas of Fulbright & Jaworski,
counsel for the corporation, Mr, BoL Peterson, First Southwest
f Company, Mr, Alan Raynor, McCall, Parkhurst & Horton, Mr. John
Stohlman, NCNB Texas National Bank, Mr, Gregg Hasty, MTrust
Corp, National Association.
The meeting was called to order by the President of
the Board, Mr, Don Hill, The minutes of the meeting of
January 12, 1989, were approved upon a motion, second, and
unanimous vote. Minutes for the hearing of December 28, 1988,
I were presented by Mr, Hill, and approved upon a motion, second,
I` and unanimous vote,
Consideration was then given to selection of a Trustee
~ for the Denton County Housing Finance Corporation Single Family
Mortgage Revenue Bonds
i Program) Series 1989 (the "Bonds") Mortgage-Hacked Securities i
Mr.
Texas National Bank had been Trustee in past issues thfor NCNB
he
1
Corporation, Mr, Chew noted that previously, the Hoard of '
Directors had not selected trustees by bid. Mr. Peterson
stated that he had taken bids from three proposed Trustees,
each of which was qualified to serve as Trustee, Mr, Hill
asked if there was any reason why the Board of Directors should
not select the low bidder as Trustee, Mr. Stohlman stated that
there was some value in continuity, Upon a motion, second, and
unanimous vote, MTrust Corp, National Association was chosen
as Trustee for the Bonds.
The Board next recognized Mr, Peterson who reviewed
with the Board the proposed Participants in the Single Family
' Mortgage Purchase Program (1989), a copy
hereto as Exhibit A. Mr. Thomas reviewd fwi h c which attached
Directors resolutions authorizing Denton County Housing Finance
Corporation Single Family Mortgage Y tgage Revenue
GNM Mortgage Backed Securities Program) Series 1989;on as Sing e
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Family Mortgage Purchase Program (1989); and Other Matters in
Connection Therewith, a copy of which is attached hereto as
Exhibit B, A copy of the preliminary official statement used
presented to
market
rd, the copy S of by whthe ich underwriters
is er attached w hereto also
the Board, Exhibit C.
Upon motion duly moved and seconded, the Board adopted the
Resolutions,
The Board, upon motion made and duly seconded and
approved unanimously, determined to table the remaining items
of its agenda,
THERE BEING NO FURTHER BUSINESS TO COME BEFORE THE
BOARD, THE MEETING WAS ADJOURNED,
*
The above and foregoing minutes were passed and
approved by the Board of Directors of the Denton County Housing
Finance Corporation on
I { President
ATTEST;
Secretary i
(SEAL)
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Ado"
$16,350,000
DENTON COUNTY HOUSING FINANCE CORPORATION
Single Family Revenue Bonds
30 Year Fixed Rate Mortgage
FHA - VA
~ i
First time homeowners or have not owned a home in three years.
Homes In Denton County excluding the C'
sties of Dallas and Carrollton.
8 3/4%
Maximum Family Income Lirnin
Two or less
Three or more '37'600 Adjusted Gross income
$43,240 Adjusted Gross Income
I Maximum Home Pricese
New Residences
Existing Residences $108,630 I
' i $105,840 ;
Lendersr
Capitol City Savings
I Karen Smith
214-971-3824
CTX Mortgage Company
Linda Frank
214-221-1775
4 Denton Savings Association
~ Penny Posey i
j Norwest Mortgage, Inc. 87-387-3505
Diane Wlndorf
Bob Miller 214-960-9019
} University Centre Mortgage 817-485-0653
I
~ OaY Tadlock
Waterfleid Financial Corporation 817-332-8810
Terry Long
Weyerhaeuser Mortgage Company 214-235-1902
Dorothy Bubenik
For 90 days beginning April 1, .1989 214-458-9510
all lenders must reserve 20% of their
allotment for public participation an a first-come, first-served basis. ~
e
No applications may be
Y taken until Aprll 1, 1989.
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DENTON COUNTY HOUSING FINANCE CORPORATION
1989 Single-Family Housing Participants
Requested Allocated
CAPITOL. CITY SAVINGS $ 30000,000 $ 2,7010048
Attn: Nancy Hempe
919 Congress Ave., 4th Floor
Austin, Texas 78701-2444
(512)478-1607
CTX MORTGAGE COMPA14Y 6,0001000 500000000
Attn: Rick Carothers
3333 Lee Parkway
P. 0. Box 19000
Dallas, Texas 752119
(214) 559-6500
` DENTON SAVINGS ASSOCIATION 200000000 2,000,000
A ttnt Jerry Gage
300 North Elm
I Denton, Texas 76201
Contacts Penny Posey
(817) 387-3505
i
FORT WORTH MORTGAGE COMPANY 20000,000 21000,000
Attnt Mary Ann Nicholas j
217 S. Stemrnons
Lewisville, Texas 75067
(214) 221-2581
+ NORWEST MORTGAGE INC. 10000,000 11000,000
Attnt Kathleen Watczak
6737 Arapaho Rd,, Suite 767
Dallas, Texas 75248
(612)343-3428
UNIVERSITY CENTRE MORTGAGE 7300000 750,000
Attm Jay Tadlock
1320 South University Drive, Suite 123
Fort Worth, Texas 76107
(817) 332-8810
WATERFIELD FINANCIAL CORPORATION 300000000 2,000,000
Attnt Joyce Blue Baugher
200 East Berry Street
I Fart Wayne, Indiana 46802
(219) 4258338
WEYERHAEUSER MORTGAGE COMPANY 115001000 1LSOOy000
i Attnt Dorothy Bubenik
3720 LBJ Freeway
Dallas, Texas 73240
(214) 438-9310
TOTAL $18,630,000 $16,931,048
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DENTON COUNTY DISTRIBUTION LIST
DENTON COUNTY HOIJ ING7FINANCE CORPORATION
SINGLE FAMILY REVENUE BONDS,
SERIES 1989
ISSUER
DENT ON COUNTY HOUSING FINANCE CORPORATION
110 West Hickery
Denton, Texas 76201
Mr. Don Hill - (817) 383-8399
President
Fax # (817)
BOND COUNSEL
t ULBRIGHT & JAWORSKI
1200 Ross Avenues Suite 2800
r,. Dallas, Texas 75201
j Mr. Fred Carter - (214) 855-8012
Fax # (214) 855-8200
Mr. Nell Thomas - (713) 651-3613
1301 McKinney
Houston, Texas 77010
j Fax # (713) 651-5246 i
j
Mr. George W
2200 1 • Scofield - (512) 224-579
nterflrst Plaza '
300 Convent St
San Antonlo, Texas 78205
Fax # (512) 224-8336
UNDERWRrmR
F` IRS"SOU WEST COMPANY
500 First City Center
1700 Pacitic'Avenue
Dallas, Texas 75201
Mr, Robert E. Peterson - (214) 953-4029
Mr. Milo Mike Johnson - (214) 953-4022
Fax # (214) 954-4339
PRUDENTIAL BACH SECURITIES
100 Gold Street i
6th Floor
New York, New York 10292
Mr. Rick Massey - (212) 776-6455
Mr. Mitch Lltke - (212) 776-6077
Fax # (212) 608-9602
MORGAN STANLEY & CO. INCORPORATED
MBank Tower, Suite 1330
221 W. 6th Street
l Austin, Texas 78701
Mr. John Hinton - (312) 4784800
Fax # (512) 478-9672
K.Yi/AT! ,10
.,.;,x. UNDERwRITERIS COUNSEL +
MCCALL PARKHURST h HORTON
717 N. Harwood, 9th Floor
Dallas, Texas 75201
Mr. Alan Raynor - (214) 220-2800
Fax # (214) 953-0736
TRUSTEE
MTRUST DEBT ADMINISTRATION
Momentum PIace, 12th Floor
Dallas, Texas 75201
Mr. Greg Hasty - (214) 290-3357
Ms. Reanne Barber - (214) 290-3411
Fax # (214) 290-3423
TRUSTEE COUNSEL 1
LOCKE PUMNELL RAIN HARRELL
2200 Ross Avenue, Suite 2200
f Dallas, Texas 75201
i Mr. Mark Johnson - (214) 740-8624
Fax # (214) 740-8800
MASTER SERVICER
LOMAS MORTGAGE USA
1420 Viceroy
Dallas, Texas 73235
Ms. Anne Wilson - (214) 879-1375
Fax # (214) 879-5614 or 879-5615
I MASTER SERVICER COUNSEL
LOCKE PURNELL RAIN HARRELL
f 2200 Ross Avenue, Suite 2200
{ Dallas, Texas 75201 I
Mr. Mark O'Brien - (214) 740-8728
Fax # (214) 740-8800
RATING AGENCY
TANDARD do POOR'S CORPORATION
25 Broadway
New York, New York 10004
Ms. Mary Novick
(212) 208-1882
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MINUTES OF MEETING OF BOARD OF DIRECTORS
JANUARY 12, 1989
The State of Texas
County of Denton
Denton County Housing Finance Corporation 55
The Board of Directors (the "Board"
County Housing Finance Corporation (the ) of Denton
the Commissioner's Courtroom, Courthouse onctheo g lion ) met in
Texas, at 9;00 a.m. on January 12, 1989, The following members 1
of the Board were presentr Mr. Don Hill, Mr, Mark Chew,
Mr. Lloyd Harrell, County Judge Vic Burgess, Ms. Diane
(r Edmondson, ~
Mr. Jim Jene, and Mrs, Lee Walker, Also attending ~I
were Mr, Neil Thomas of Fulbright & Jaworski, counsel for the
corporation, Mr, Bob Peterson, First Southwest Company, and
i
Mr. John Stohlman and Ms. Pam Jones, NCNB Texas National Bank,
r ~ The meeting was '
called to '
the Board, Mr. Don Hill, The m order by the President of
December 15, 1988, were approved upon a motion, second, and
Consideration was then given to a Resolution Amending
Resolutions Authorizing Denton Count
Corporation Multifamily Housin
g y Housing Finance
1 ! (Certificate of Deposit Program) Series en1989A ( Re Dent ending Bonds
Association Apple Creek Apartments Project); and Other
I Resolutions Author onneztion Therewith; Resolution Amending
Corporation Multiform) g Denton County Housing Finance
y Housing Revenv,a Refunding Bonds
(Certificate of Deposit Program) Series 19898 (Denton Savings
1 Association Brighton Place Apartments Project); and Other
Matters in Connection Therewith; and Resolution Amending
Resolutions Authorizing Denton County Housing Finance
Corporation Multifamily Housing Revenue Refunding Bonds
(Certificate of Deposit Program) Series 1989C (Denton Savings
Association 1505 North Locust Apartments Project); and Other
Matters in Connection Therewith
"Resolutions"), copies of which are attached ivhereto tas
Exhibit "A", "B and "C", respectively, Mr. Thomas
Board that the principal purpose of the Resolutionstold
was tto
replace Texas Commerce Bank National Association and Douglas
Capital Markets, Inc, as underwriters for the proposed bonds
} with Prudential-Bache Securities, Inc. and Douglas Capital
Markets, Inc., and to replace Texas Commerce Bank National
Association as remarketing agent with Prudential-Bache
Securities, Inc, and Douglas Capital Markets, Inc, After due
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The Board next requested that Fulbright & Jaworski
provide the Board with an opinion concerning how it may use its
surplus funds. The Board requested that the opinion be
provided within 30 days.
The Board next discussed how its surplus funds would
be used. It was the general consensus of the Board tc discuss
the matter upon receipt of the letter from Fulbright & Jaworski.
The Board next considered when it would have its
meetings. Mr. Chew requested that the meetings be held in the
late afternoon, beginning at 4000 p,m, or 5;00 p.m,
THERE BEING NO FURTHER BUSINES.1 TO COME BEFORE THE
BOARD, THE MEETING WAS ADJOURNED.
1
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The above and foregoing minutes were passed and
approved by the Board of Directors of the Denton County Housing
Finance Corporation on
. 0
Pres dent f
ATTEST:
1
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(SEAL)
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BUSINESS ESSENTIALS OFFICE; SUPPLY
817-u66-4925 b14 NORTH ELM IIETRO 430-8981
FAXN 817-:187-492.7 DLNTUN, TX 762191 Flage
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Invoice N 91026140 Type of Sale
Delivery Locatians CHARGE
Customer Phone (817)383-8399 Da-bEA Time
Sold Too IU/28/89 17.13
DEN'r0N CO. HOUSING FINANCE CUR Ship Too
110 WEST HIQKUhY
THIRD FLOOR
DEN'fON, TX 76201 ,
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Cust #/Dept I:IO Number Sale%## Writer bpecial 1nst•ructinns
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10363 5MD 0 60 EA N I
POCKET, LUL 14. 71;X9. 5 5.25" kf; 2• 02 101.00
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April 25, 1989 CIP/MAIJAOERSOFFICE
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hit. Lloyd Harrell
Denton County Housing Finance Corporation
301 Fast McKinney
Denton, Texas 76201
h I Dear Mr. Harrell:
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As a director of the Texas Association of Local Housing Finance Agencies, I wanted to thank
f' you for participating in the educational conference April 6 & 7 of 1989, We valued your
attendance and hoped you enjoyed the seminar,
I also hope you will not hesitate to call me if you have any questions regarding housing bond
issues or new legislation, As an underwriter of housing bonds, we stay abreast of the market
and would be glad to assist you. For your review, I've enclosed an official statement from a s
i l recent bond offering for Southeast Texas HFC,
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Thank you again for your interest and support,
Yours very truly,
f
une B. Baumoel
Vice President
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2121 SAN JACINTO ISTRE=E" 1' SUITE '1E330, FJAL.L.AS, TX 75201 I2141 9Fj4-4184
90 NOFITI FIIGFI STF1E C_"""C, CCJL_.1N1E7UE, EJHICJ 43215 1014) r?21-0722
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NEW ISSUE Standard & Poor'si AAA
(See "RATING" herein)
In the opinion of Bond Counsel, under existing statutes, regulations, published "dings and court decisions,
interest on the Bonds is not includable in the gross income of the owners of the Bonds for federal income tax
purposes, assuming compliance by the Issuer, flu: Master Servicer and the Lenders with certain covenants
TIONcontained in the Indenture and the CERTAIN OTHER FEDERAL INCOME TAX~AIAand TTERSJr herein i for agdiscussion of B nd Counsel's
opinion and cerlahn collateral federal income tax consequences of ownership of the Bonds,
$39,999,943.40
The Southeast Texas Housing Finance Corporation
Single Family Mortgage Revenue Bonds
(GNMA Mortgage-Backed Securities Program)
1988 Series
Datedi October 1, 1968 A
(Capital Appreciation Bonds Due as shown below
+ dated their date of issuance)
The Current Interest Bonds are dated and accrue interest from October 1, 1988, and the Capital
Appreciation ?fonds are dated and accrue interest from their date of Issuance. The Bonds are available to
purchasers only in book entry form, representing beneficial interests in the Bonds, in denominations of
{ integral multiples of $5,000 principal amount in the case of Current Interest Bonds or $5,000 Accreted Value
+ at maturity in the case of Capital Appreciation Bonds. Purchasers of the Bonds will not receive certificates I
representing their interests In the Bonds purchased, Bonds will be registered in the name of Cede br Co., as
registered owner and nominee of The Depository Trust Company, New York, New York. Interest on the
Current Interest Bonds will be payable on each April 1 and October 1, commencing April 1, 1989, Principal
i (or redemption price) of and interest on the Bands Is payable by MTrust Corp, National Association, as
Trustee to Cede do Co. which will make distribution of amounts so paid for distribution to the beneficial
owners of the Bonds. (See "TILE. BONDS" and "BOOK-ENTRY ONLY SYSTEM" herein.)
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The Bonds are being issued to provide funds for a program under which The Southeast Texas Housing
Finance Corporation (the "Issuer") will purchase fully modified mortgage-backed securities (the "GNbIA
Securities"), guaranteed as to timel pa meat of principal and interest b the Government National
Mortggagge Association ("GNMA") an backed by pools of mortgage loans made by participating lenders to
f quail
ed persons In order to finance the purchase of single famfly residential housing.
THE ARE LIMITED OBLIGATINS OF THE PAYABLE ONLY FROM REVENUES
I OF THE I SU RSDESCRI ED HEREIN. (EE "S CURITYIFOR THE BONDS" HEREIN.) THE BONDS
I WILL NOT CONSTITUTE AN OBLIGATION OR INDEBTEDNESS OF THE STATE OF TEXAS OR OF
ANY COUNTY, CITY, OR OTHER MUNICIPAL OR POLITICAL CORPORATION OR SUBDIVISION
OF THE STATE OF TEXAS. NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF
THE STATE OF TEXAS OR OF ANY COUNTY, CITY, OR OTHER MUNICIPAL. OR POLITICAL,
I CORPORATION OR SUBDIVISION OF THE STATE OF TEXAS IS PLEDGED TO THE PAYMENT OF
THE PRINCIPAL OR REDEMPTION PRICE. OF OR INTEREST ON THE BONDS. THE ISSUER HAS
NO TAXING POWER. CNMA IS NOT LIABLE FOR PAYMENT OF THE BONDS, NOR HAS GNALA
UNDERTAKEN THAT PAYMENTS ON THE CNMA SECURITIES WILL BE SUFFICIENT TO PAY THE
PRINCIPAL OF, AND INTEREST ON, THE BONDS WIZEN DUE.
A detailed Maturity Schedule is shown on the inside front cover. The Bonds are subject to redemption
that ato their respective stated maturities as set forth herein beginning February 1, 1989, and It is expected substantial portion of the Bonds will be so redeemed,
(See "THE BONDS - Redemption" herein.)
The Bonds are offered when, as and if issued by the Issuer and received by the Underwriters, subject to
I' approval of the Bonds by the Attorney General of the State of Texas and receipt of the opinion of lows, Day,
Reovis 1s Pogue, Dallas, Texas, Bond Counsel. Certain legal matters will be passed upon for the*issuer by the
Law Offices of Andrew P. Johnson, 111, P.C.. Certain legal matters will be passed upon for the Underwriters by
their counsel, Haynes 1x Miller, Washington, D.C. It is expected that Bonds will be available jor delivery to The
Depository nwi Company in New York, New York, on or about October 18, 1988,
Meuse, Rinker, Chapman, Endres & Brooks
First Southwest Company
McDonald & Company Securities
September 21, 198$
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