RESOLUTION OF THE CITY
OF NORRIS, TENNESSEE, AUTHORIZING THE ISSUANCE OF INTEREST BEARING GENERAL OBLIGATION CAPITAL OUTLAY NOTES, SERIES 2012, IN
AN AMOUNT NOT TO EXCEED $60,000, AND PROVIDING FOR THE PAYMENT OF SAID NOTES
WHEREAS, the City Council (the "Council"), of the City of Norris, Tennessee (the "Municipality"),
has determined that it is necessary and desirable to authorize, issue, sell, and provide for the payment of its interest bearing
capital outlay notes to finance certain public works projects, consisting of paying the costs of the acquisition of a vehicle
for the Public Works Department, the installation of four fire hydrants, and the acquisition and installation of a new roof
for the Public Safety Building, the acquisition of all other property real and personal appurtenant thereto and connected
with such work, and to pay all legal, fiscal, administrative, and engineering costs, incident thereto (collectively, the "Project"),
and paying costs incident to the financing thereof;
WHEREAS, the Municipality estimates that the economic life of the Project is at least 7 years;
WHEREAS, the Municipality
finds and determines that the Project will promote or provide a traditional governmental activity or otherwise fulfill a public
in order to proceed as expeditiously as possible with such an essential Project, it is necessary that interest bearing capital
outlay notes be issued for the purpose of providing funds to finance the Project; and,
WHEREAS, the Municipality is authorized by the provisions of Title 9, Chapter 21, Tennessee Code Annotated,
as amended, to issue such notes for said purposes upon the approval of the Director of State and Local Finance (the "Director
of State and Local Finance"):
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Norris, Tennessee, as follows:
Authority. The Notes herein authorized shall be issued pursuant to Title 9, Chapter 21, Tennessee Code Annotated,
as amended, and other applicable provisions of law.
Section 2. Authorization. For the purpose
of providing funds to finance the costs of the Project and to pay costs incident to the financing thereof, there shall be
issued pursuant to, and in accordance with, the provisions of Title 9, Chapter 21, Tennessee Code Annotated, as amended,
and other applicable provisions of law, the interest bearing capital outlay notes of the Municipality, in the aggregate principal
amount of not to exceed $60,000, or such lesser amount as may be determined by the Mayor of the Municipality (the "Mayor")
at the time of sale (collectively, the "Notes", individually, the "Note"). The term of the Notes
shall not exceed the reasonably expected economic life of the Project, which is hereby certified to be at least the term of
Terms of the Notes. The Notes shall be designated "General Obligation Capital Outlay Notes, Series
2012". The Notes shall be issued in registered form, without coupons, in minimum denominations of $5,000.
The Notes shall be numbered from 1 upwards, shall be dated the date of issuance and delivery, shall be sold at not less than
the par amount thereof, shall bear interest at a rate or rates not to exceed 4% per annum, such interest being payable at
such times as agreed upon with the purchaser of such Notes, but in no event less than semiannually each year commencing six
months from the dated date or such date as shall be designated by the Mayor (the "Interest Payment Date"), and shall
mature not later than the end of the seventh fiscal year following the fiscal year in which the notes are issued. Each
year the Notes are outstanding the Municipality shall retire principal on the Notes in an amount that is estimated to be at
least equal to an amortization, which reflects level debt service on the Notes. The Notes shall contain such terms,
conditions, and provisions other than as expressly provided or limited herein as may be agreed upon by the Mayor of the Municipality
and the purchaser of the Notes.
Interest on the Notes shall be payable by check or other form of draft of the "Note Registrar," as such term is
hereinafter defined, deposited by the Note Registrar in the United States mail, first class postage prepaid, in sealed envelopes,
addressed to the owners of such Notes, as of the applicable Interest Payment Date, at their respective addresses as shown
on the registration books of the Municipality maintained by the Note Registrar as of the close of business fifteen (15) calendar
days preceding the next Interest Payment Date. The principal of all Notes shall be payable upon presentation and surrender
of such Notes at the principal office of the Note Registrar. All payments of the principal of and interest on the Notes
shall be made in any coin or currency of the United States of America, which, on the date of payment thereof, shall be legal
tender for the payment of public and private debts.
Redemption. The Notes shall have such redemption provisions as may be determined at the time of the sale
of the Notes by the Mayor and the purchaser of the Notes; provided, however, that no redemption premium shall be great than
Execution. The Notes shall be executed in the name of the Municipality; shall bear the manual signature of the
Mayor; shall be countersigned by the City Recorder of the Municipality (the "City Recorder"), with his or her manual
signature; and, shall have printed or impressed thereon the official seal of the Municipality. In the event any officer
whose signature appears on the Notes shall cease to be such officer, such signature shall nevertheless be valid and sufficient
for all purposes. The Notes shall be issued in typed, printed, or photocopied form, or any combination thereof, substantially
in the form attached hereto as Exhibit "A", with such minor changes therein or such variations thereof as the Mayor
may deem necessary or desirable, the blanks to be appropriately completed by the Mayor prior to the issuance of the Notes.
Registration, Negotiability, and Payment. (a) The City Recorder of the Municipality is hereby appointed
the note registrar and paying agent (the "Note Registrar"), and as such shall establish and maintain suitable books
(the "Registration Books"), for recording the registration, conversion, and payment of the Notes, and shall also
perform such other duties as may be required in connection with any of the foregoing. The Note Registrar is hereby authorized
to authenticate and deliver the Notes to the original purchaser thereof, or as he or she may designate, upon receipt by the
Municipality of the proceeds of the sale thereof and to authenticate and deliver Notes in exchange for Notes of the same principal
amount delivered for transfer upon receipt of the Notes to be transferred in proper form with proper documentation as herein
described. The Notes shall not be valid for any purpose unless authenticated by the Note Registrar by the manual signature
of the Note Registrar on the certificate set forth in Exhibit "A" hereto. The Notes shall be fully registered
as to both principal and interest and shall be fully negotiable upon proper endorsement by the registered owner thereof.
No transfer of any Notes shall be valid unless such transfer is noted upon the Registration Books and until such Note is surrendered,
cancelled, and exchanged for a new Note which shall be issued to the transferee, subject to all the conditions contained herein.
Principal of the Notes shall be paid at maturity upon presentation or surrender of the Notes at the principal office of the
Note Registrar, and payment in such manner shall forever discharge and release the obligation of the Municipality to the extent
of the principal and interest so paid.
(b) The Municipality may from time to time at its discretion
remove the Note Registrar and appoint a successor Note Registrar to whom all records, documents, and instruments relating
to its duties as Note Registrar shall be delivered. Any successor Note Registrar shall be appointed by resolution of
the Municipality, and shall be a trust company or bank having the powers of a trust company, having, at the time of such appointment,
a combined capital, surplus, and undivided profits aggregating at least Ten Million Dollars ($10,000,000), and be willing
and able to accept the office of Note Registrar on reasonable and customary terms, and authorized by law to perform all duties
imposed upon it by this Resolution.
(c) In the event that any amount payable on any Note as
interest shall at any time exceed the rate of interest lawfully chargeable thereon under applicable law, then any such excess
shall, to the extent of such excess, be applied against the principal of such Note as a prepayment thereof without penalty,
and such excess shall not be considered to be interest. All rates of interest specified herein shall be computed on
the basis of a three hundred sixty (360) day year composed of twelve (12) months of thirty (30) days each.
Exchange of Notes. Notes upon surrender thereof at the office of the Note Registrar, together with an assignment
of such Notes duly executed by the registered owner thereof, or his, her, or its attorney or legal representative, may be
exchanged for an equal aggregate principal amount of Notes of the same maturity, of any denomination or denominations authorized
by this Resolution, and bearing interest at the same rate as the Notes surrendered for exchange.
Section 8. Transfer of Notes. Each Note
shall be transferable only on the registration books maintained by the Note Registrar at the principal office of the Note
Registrar, upon the surrender for cancellation thereof at the principal office of the Note Registrar, together with an assignment
of such Note duly executed by the owner thereof or his, her or its attorney or legal representative, and upon payment of the
charges hereinafter provided, and subject to such other limitations and conditions as may be provided therein or herein.
Upon the cancellation of any such Note, the Note Registrar shall, in exchange for the surrendered Note or Notes, deliver in
the name of the transferee or transferees a new Note or Notes of authorized denominations, of the same aggregate principal
amount, maturity, and rate of interest as such surrendered Note or Notes, and the transferee or transferees shall take such
new Note or Notes subject to all of the conditions herein contained.
Section 9. Regulations with Respect to Exchanges
and Transfers. In all cases in which the privilege of exchanging or transferring Notes is exercised, the Municipality
shall execute, and the Note Registrar shall deliver, Notes in accordance with the provisions of this Resolution. For
every exchange or transfer of Notes, whether temporary or definitive, the Municipality and the Note Registrar may make a charge,
unless otherwise herein to the contrary expressly provided, sufficient to pay for any tax, fee, or other governmental charge
required to be paid with respect to such exchange or transfer, all of which taxes, fees, and other governmental charges shall
be paid to the Municipality by the person or entity requesting such exchange or transfer as a condition precedent to the exercise
of the privilege of making such exchange or transfer.
Section 10. Mutilated,
Lost, Stolen, or Destroyed Notes. In the event any Note issued hereunder shall become mutilated, or be lost, stolen,
or destroyed, such note shall, at the written request of the registered owner, be cancelled on the Registration Books and
a new Note shall be authenticated and delivered, corresponding in all aspects but number to the mutilated, lost, stolen, or
destroyed Note. Thereafter, should such mutilated, lost, stolen, or destroyed Note or Notes come into possession of
the registered owner, such Notes shall be returned to the Note Registrar for destruction by the Note Registrar. If the
principal on said mutilated, lost, stolen, or destroyed Note shall be due within fifteen (15) calendar days of receipt of
the written request of the registered owner for authentication and delivery of a new Note, payment therefor shall be made
as scheduled in lieu of issuing a new Note. In every case the registered owner shall certify in writing as to the destruction,
theft, or loss of such Note, and shall provide indemnification satisfactory to the Municipality and to the Note Registrar,
if required by the Municipality and the Note Registrar.
Any notice to the contrary notwithstanding, the Municipality and all of the officials, employees, and agents thereof, including
the Note Registrar, may deem and treat the registered owners of the Notes as the absolute owners thereof for all purposes,
including, but not limited to, payment of the principal thereof, and the interest thereon, regardless of whether such payment
shall then be overdue.
11. Authentication. Only such of the Notes
as shall have endorsed thereon a certificate of authentication, substantially in the form set forth in Exhibit "A"
hereto duly executed by the Note Registrar shall be entitled to the rights, benefits, and security of this Resolution.
No Note shall be valid or obligatory for any purpose unless, and until, such certificate of authentication shall have been
duly executed by the Note Registrar. Such executed certificate of authentication by the Note Registrar upon any such
Note shall be conclusive evidence that such Note has been duly authenticated and delivered under the Resolution as of the
date of authentication.
12. Source of Payment and Security. The Notes, as to both principal and interest, shall
be payable from funds of the Municipality legally available therefor and to the extent necessary from ad valorem
taxes to be levied on all taxable property within the corporate limits of the Municipality without limitation as to time,
rate, or amount. Said Notes shall be a direct general obligation of the Municipality, for which the punctual payment
of the principal of and interest on the Notes, the full faith and credit of the Municipality is irrevocably pledged.
Levy of Taxes. For the purpose of providing for the payment of the principal of and interest on the Notes, to
the extent required, there shall be levied in each year in which such Notes shall be outstanding a direct tax on all taxable
property in the Municipality, fully sufficient to pay all such principal and interest falling due prior to the time of collection
of the next succeeding tax levy. Said tax shall be assessed, collected, and paid at the time, and in the same manner,
as the other taxes of said Municipality, shall be in addition to all other taxes, and shall be without limitation as to time,
rate, or amount, and for that purpose there is hereby levied a direct annual tax in such amount as may be found necessary
each year to pay said principal of and interest on the Notes maturing in said year. Principal or interest falling due
at any time when there shall be insufficient funds on hand from such tax levy for the payment thereof shall be paid from the
general fund or other available funds of the Municipality, but reimbursement therefor may be made from the taxes herein provided
when the same shall have been collected. Such taxes levied and collected therefor shall be deposited in the debt service
fund of the Municipality and used solely for the payment of principal of and interest on the Notes as the same shall become
Approval of Director of State and Local Finance. Anything herein contained to the contrary notwithstanding, no
Notes authorized under this Resolution shall be issued, sold, or delivered, unless and until such Notes shall first have been
duly approved by the Director of State and Local Finance of the State of Tennessee as provided by Section 9-21-601 et. seq.,
Tennessee Code Annotated, as amended. The Mayor, City Recorder, City Attorney, and Bond Counsel are hereby authorized
to take or cause to be taken such steps as are necessary to obtain such approval. After the issuance and sale of the
Notes, and for each year that any of the Notes are outstanding, the Municipality shall submit its annual budget to the Director
of State and Local Finance for approval immediately upon the Municipality's adoption of the budget.
Section 15. Sale of Notes. The Notes herein authorized are authorized to be sold by
the Mayor by the informal bid process at a price of not less than par and accrued interest.
Section 16. Disposition of Note Proceeds.
The proceeds from the sale of the Notes shall be paid to the official of the Municipality designated by law as the custodian
of the funds thereof to be deposited in a special fund known as the "General Obligation Capital Outlay Notes, Series
2012 Project Fund" (the "Project Fund"), which is hereby authorized to be created, to be kept separate and
apart from all other funds of the Municipality. The monies in the Project Fund shall be disbursed solely to finance
the Project and to pay the costs of issuance of the Notes, and other necessary miscellaneous expenses incurred in connection
with the issuance and sale of the Notes. Monies in the Project Fund may be invested and shall be secured in the manner
prescribed by applicable statutes relative to the investment and securing of public or trust funds. Any monies remaining
in the Project Fund after completion of the Project shall be used to pay principal of and interest on the Notes.
Non-Arbitrage Certification. The Municipality certifies and covenants with the owners of the Notes that so long
as the principal of any Note remains unpaid, monies on deposit in any fund or account in connection with the Notes, whether
or not such monies were derived from the proceeds of the sale of the Notes or from any other source, will not be used in a
manner which will cause the Notes to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue
Code of 1986, as amended (the "Code"), and any lawful regulations promulgated thereunder, as the same presently
exist, or may from time to time hereafter be amended, supplemented, or revised. The Municipality reserves the right,
however, to make any investment of such monies permitted by Tennessee law and this Resolution if, when and to the extent that
said Section 148 or regulations promulgated thereunder shall be repealed or relaxed or shall be held void by final decision
of a court of competent jurisdiction, but only if any investment made by virtue of such repeal, relaxation, or decision would
not, in the opinion of counsel of recognized competence in such matters, result in making the interest on the Notes subject
to inclusion in gross income of the owners thereof for federal income tax purposes.
The Municipality covenants that it shall comply with Section 148(f) of the Code, unless legally exempted therefrom
and it represents that in the event it shall be required by Section 148(f) of the Code to pay "Rebatable Arbitrage,"
as defined in the regulations promulgated under the Code, to the United States Government, it will make such payments as and
when required by said Section 148(f) and will take such other actions as shall be necessary or permitted to prevent the interest
on the Notes from becoming subject to inclusion in federal gross income of the owners of the Notes for purposes of federal
Designation of Notes as Qualified Tax-Exempt Obligations. The Municipality hereby designates the Notes as "qualified
tax-exempt obligations" within the meaning and for the purpose of Section 265(b)(3) of the Internal Revenue Code of 1986,
Section 19. Resolution a Contract. The
provisions of this Resolution shall constitute a contract between the Municipality and the owners of the Notes, and after
the issuance of the Notes, no change, variation, or alteration of any kind in the provisions of this Resolution shall be made
in any manner, until such time as all installments of the principal of and interest on the Notes shall have been paid in full
or the consent of the registered owners of the Notes has been obtained; provided, however, that the Municipality is hereby
authorized to make such amendments to this Resolution as will not impair the rights or security of the owners of the Notes.
No Action to be Taken Affecting Validity of the Notes. The Municipality hereby covenants and agrees that it will
not take any action, that would in any manner affect the validity of the Notes or limit the rights and remedies of the owners
from time to time of such Notes. The Municipality further covenants that it will not take any action that will cause
the interest on the Notes to be subject to inclusion in gross income of the owners thereof for purposes of federal income
Miscellaneous Acts. The Mayor, the City Recorder, the City Manager, the City Attorney, and all other appropriate
officials of the Municipality are hereby authorized, empowered, and directed to do any and all such acts and things, and to
execute, acknowledge, and deliver all such documents, instruments, and certifications, specifically including but not limited
to, making arbitrage certifications and executing a note purchase agreement in connection with the purchase of the Notes,
in addition to those acts, things, documents, instruments, and certifications hereinbefore authorized and approved, as may
in their discretion, be necessary or desirable to implement or comply with the intent of this Resolution; or any of the documents
herein authorized and approved; or for the authorization, issuance, and delivery of the Notes.
Section 22. Failure to Present Notes. Subject to the provisions of Section 3 hereof,
in the event any Note shall not be presented for payment when the principal becomes due at maturity and in the event monies
sufficient to pay such Note shall be held by the Note Registrar for the benefit of the owner thereof, all liability of the
Municipality to such owner for the payment of such Note shall forthwith cease, terminate, and be completely discharged.
Thereupon, the Note Registrar shall hold such monies, without liability for interest thereon, for the benefit of the owner
of such Note who shall thereafter be restricted exclusively to such monies for any claim under this Resolution or on, or with
respect to, said Note, subject to escheat or other similar law, and any applicable statute of limitation.
Payments Due on Saturdays, Sundays, and Holidays. Whenever the interest on or principal of any Note is due on
a Saturday or Sunday or, at the place designated for payment, a legal holiday or a day on which banking institutions are authorized
by law to close, then the payment of the interest on, or the principal of, such Note need not be made on such date but must
be made on the next succeeding day not a Saturday, Sunday, or a legal holiday or a day upon which banking institutions are
authorized by law to close, with the same force and effect as if made on the date of maturity; and no interest shall accrue
for the period after such date.
Section 24. No Recourse Under Resolution or on Notes. All stipulations, promises, agreements,
and obligations of the Municipality contained in this Resolution shall be deemed to be the stipulations, promises, agreements,
and obligations of the Municipality and not of any officer, director, or employee of the Municipality in his or her individual
capacity, and no recourse shall be had for the payment of the principal of or interest on the Notes or for any claim based
thereon or under this Resolution against any officer, director, or employee of the Municipality or against any official or
individual executing the Notes.
Section 25. Severability. If any section,
paragraph, or provision of this Resolution shall be held to be invalid or unenforceable for any reason, the invalidity or
unenforceability of such section, paragraph, or provision shall not affect any of the remaining provisions hereof.
Section 26. Repeal of Conflicting
Resolutions and Effective Date. All resolutions and orders, or parts thereof, in conflict with the provisions of
this Resolution, are, to the extent of such conflict, hereby repealed, and this Resolution shall be in effect as of the date
of its adoption the welfare of the Municipality requiring it.
Approved and adopted this 12th day of November, 2012.