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R-94-12-22-10G - 12/22/1994First Southwest Company 1700 Pacific Avenue Suite 500 Dallas, Texas 75201 Ladies and Gentlemen: City of Round Rock, Texas 221 East Main Street Round Rock, Texas 78664 DEALER MANAGER AGREEMENT - 94- fa -J:2 Qc January 13, 1995 1. The Offer. The City of Round Rock, Texas (the "Purchaser "), intends to make a tender offer (hereinafter, together with any extensions or amendments thereof, called the "Offer ") to purchase for cash any and all of the outstanding $6,740,000 aggregate principal amount of City of Round Rock, Texas, Golf Course Trust Certificates, Series 1989 (the "Certificates "), issued pursuant to that certain Trust Agreement, dated as of December 1, 1989 (the "Trust Agreement "), by and among the Purchaser, First City, Texas - Austin, N.A., as trustee (now Frost National Bank, Austin, Texas), and Round Rock Golf, Inc. 2. (a) Appointment as Dealer Manager. The Purchaser hereby appoints you as dealer manager ( "Dealer Manager ") in connection with the Offer. You agree that you will act, in accordance with the terms hereof, as Dealer Manager for the Offer. (b) Appointment as Tender Pricing Advisor. The Purchaser hereby appoints you as tender pricing advisor ( "Tender Pricing Advisor ") in connection with the Offer. You agree you will advise and recommend a tender price to the Purchaser in connection with the Offer. The Purchaser understands and agrees there can be no guarantee that the recommended tender price will result in a successful acceptance of the Offer. 3. No Liability for Acts of Dealer Manager, Dealers, Banks and Trust Companies. You shall not be liable to the Purchaser for any act or omission on the part of any broker or dealer in securities (a "Dealer "), bank or trust company, and you shall not be liable for your own acts or omissions in performing your obligations as Dealer Manager hereunder, except for any loss, damage, liability or expense primarily attributable to your negligence, bad faith or willful misconduct. In connection with the Offer, no Dealer, bank or trust company is to be deemed to be acting as your agent or the agent of the Purchaser, and you, as Dealer Manager, shall act as an independent contractor and are not to be deemed for any purpose to act as a joint venturer of, or be the agent of, the Purchaser. First Southwest Company January 13, 1995 4. The Offer Material. The Purchaser agrees, at its expense, to furnish you with as many copies as you may reasonably request of the invitation to tender and solicitation for consent, the letters of transmittal, the instruction form, the consent form and the related letters and documents, together with any supplements or amendments to any such documents, to be used by the Purchaser in connection with the Offer (such documents being hereinafter referred to collectively as the "Offer Material "), and you are authorized to use copies of the Offer Material. The Purchaser will not file, use or publish any material in connection with the Offer, including the Offer Material, or refer to you in any such material, without your consent. 5. Scope of Services; Compensation; and Expenses. Your sole obligation as Dealer Manager shall be to act as a broker /dealer with respect to the Offer in those jurisdictions where the Offer is required by law to be made through a licensed broker or dealer. You shall have no obligation to solicit tenders of Certificates. The Purchaser agrees to pay you a fee (the "Dealer Manager Fee ") in the amount of $15.00 for each $5,000 principal amount of Certificates tendered and accepted for purchase, such fee to be payable concurrently with the payment for such Certificates by the Purchaser under the Offer. The Purchaser agrees to pay any Eligible Institution (as defined in the Offer Material) a solicitation fee of $15.00 for each $5,000 principal amount of Certificates tendered and accepted for purchase through such Eligible Institution. The Purchaser agrees to appoint First Southwest Company to act as the sole underwriter in connection with the sale of any obligations of the Purchaser issued in connection with the Offer and the plan of finance of which the Offer is a part. The Purchaser also agrees to pay all of the fees and expenses of the Tender Agent (as defined below) and all of your out -of- pocket expenses, including the reasonable fees and expenses of your counsel, in each case incurred in connection with the Offer. The Purchaser agrees to pay you a fee of $48,850.00 (the "Tender Pricing Advisory Fee "), payable concurrently with the payment for such Certificates by the Purchaser under the Offer. 6. Representations and Warranties of the Purchaser. The Purchaser hereby represents and warranties to you as follows: (i) The Purchaser is a municipal corporation duly created and validly existing under the Constitution and laws of the State of Texas (including the Purchaser's Home Rule Charter) and has the power to enter into and has duly authorized, by proper action, the execution and delivery of this Agreement and all other documents contemplated hereby to be executed by the Purchaser; (ii) This Agreement is the legal, valid and binding obligation of the Purchaser enforceable in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws and principles of equity relating to or affecting the enforcement of creditors' rights; (iii) The execution and delivery of this Agreement and the performance by the Purchaser of its obligations hereunder do not and will not violate the Purchaser's Home First Southwest Company January 13, 1995 Rule Charter or any existing ordinances of the Purchaser, or any court order by which the Purchaser is bound, and such actions do not and will not constitute a default under any material agreement, indenture, mortgage, lease, note or other obligation or instrument to which the Purchaser is a party or by which it is bound or to which any of its property is subject, and no approval or other action by any governmental authority or agency is required in connection therewith; (vi) The Purchaser has complied with, and will comply with, the requirements of all Texas and federal laws, regulations and rules applicable to the Offer, the Offer Material and this Agreement; (v) The Offer is in full compliance with all provisions of the Trust Agreement, as the same may be amended pursuant to the solicitation for consent contained in the Offer Material; (vi) The Offer Material, except with respect to information relating to the Operator (as defined in the Offer Material) which has been provided to the Purchaser by the Operator, does not, and at all times during the Offer will not, contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they are made, not misleading; (vii) The Purchaser has no reason to believe that the information in the Offer Material relating to the Operator, which has been provided to the Purchaser by the Operator, contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they are made, not misleading; (viii) The Purchaser will pay promptly, in accordance with the terms and subject to the conditions of the Offer, the full purchase price (and related fees and expenses) for such of the Certificates as the Purchaser elects to purchase pursuant to the Offer; (xi) There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before any court, government agency, public board or other governmental body, pending or, to the best knowledge of the Purchaser, threatened against the Purchaser affecting or seeking to prohibit, restrain or enjoin (A) the Offer or any transactions in connection with, or contemplated by, the Offer, the Offer Material or this Agreement, or (B) the execution of, and the performance by the Purchaser of its obligations under, this Agreement; and (x) The Purchaser does not have knowledge of any material fact or information concerning the Certificates or the security therefor which is not disclosed in the Offer Material. 7. The Tender Agent. The Purchaser has arranged for Frost National Bank, Austin, Texas, to serve as tender agent (the "Tender Agent ") in connection with the Offer and to advise First Southwest Company January 13, 1995 you daily during the period of the Offer as to the number of Certificates of each series that have been tendered and as to such other matters as you may reasonably request. 8. Additional Information and Notification. The Purchaser will advise you promptly of (i) the occurrence of any event that could cause the Purchaser to withdraw or rescind the Offer, (ii) any event that might require any change in the Offer Material, (iii) any litigation or administrative action with respect to the Offer and (iv) any other information relating to the Offer or any of the other transactions contemplated by the Offer Material or this Agreement that you may from time to time reasonably request. 9. Indemnification. To the extent permitted by law, the Purchaser hereby agrees to hold harmless and indemnify you, your affiliated entities and directors, officers, employees and agents of you and of your affiliated entities, and any person who controls you or any of your affiliated entities within the meaning of Section 15 of the Securities Act of 1933, as amended, or Section 20(a) of the Securities Exchange Act of 1934, as amended (individually, and "Indemnified Person" and collectively, the "Indemnified Persons "), against any and all losses, claims, damages, liabilities or costs (and all actions in respect thereof and any legal or other expenses in giving testimony or furnishing documents in response to a subpoena or otherwise), including the costs of investigating, preparing or defending any such action or claim, whether or not in connection with litigation in which an Indemnified Person is a party, as and when incurred, directly or indirectly, caused by, relating to, based upon or arising out of the Offer, the Offer Material or any transaction relating to the Offer or your engagement hereunder; provided, however, such indemnity agreement shall not apply to any breach by any Indemnified Person of any of the terms of this Agreement and to any such losses, claim, damage, liability or cost to the extent it is found in a final judgment by a court of competent jurisdiction (not subject to further appeal) to have resulted primarily and directly from the negligence, bad faith or willful misconduct of an Indemnified Person. These indemnification provisions shall be in addition to any liability that the Purchaser may otherwise have to the Indemnified Persons. If any action, proceeding, or investigation is commenced, as to which any Indemnified Person proposes to demand such indemnification, it will notify the Purchaser with reasonable promptness. The Indemnified Persons will have the right to retain separate counsel of their own choice subject to the approval of the Purchaser, which approval shall not be unreasonably withheld, to represent them, and the Purchaser will pay the fees and expenses of such counsel; and such counsel shall to the fullest extent consistent with professional responsibilities cooperate with the Purchaser and any counsel designated by the Purchaser. The Purchaser will be liable for any settlement of any claim against any Indemnified Person made with its written consent, which consent shall not be unreasonably withheld. If indemnification is for any reason not to be available hereunder with respect to any claim, loss or expense contemplated by the preceding paragraphs to be subject to indemnification, you and the Purchaser agree, to the extent permitted by law, to contribute to such loss, claim, damage, liability or cost in the proportion that your compensation payable hereunder bears to the First Southwest Company January 13, 1995 aggregate value of the financial consideration to be paid by the Purchaser for all of the Certificates that are subject to the Offer (unless no Certificates are accepted for purchase, in which case such contribution shall be in the proportion that $15.00 bears to $5,000), with you paying the smaller portion and the Purchaser paying the larger portion. No investigation or failure to investigate by you shall impair the foregoing indemnification and contribution agreement or any rights you may have. 10. Conditions to Dealer Manager's Obligations. Your obligation to act as Dealer Manager with respect to the Offer shall at all times be subject to the conditions that: (i) the Purchaser at all times during the period of the Offer shall have performed all of its material obligations hereunder and with respect to the Offer which are theretofore required to have been performed; (ii) no restraining order shall have been issued and no litigation shall have been commenced or threatened with respect to the Offer or with respect to any of the transactions in connection with, or contemplated by, the Offer, the Offer Material or this Agreement before any court, government agency, public board or other governmental body of any jurisdiction that you, in good faith after consultation with the Purchaser, believe renders it inadvisable for you to continue to act as Dealer Manager hereunder; and (iii) the Purchaser shall provide you with an opinion of McCall, Parkhurst & Horton L.L.P. to the effect that (A) this Agreement is a valid and binding agreement of the Purchaser, subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws and principles of equity relating to or affecting the enforcement of creditors' rights and (B) based on such firm's participation in the Offer as counsel to the Purchaser, no facts have come to attention of such firm that lead such firm to believe that the Offer Material contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. 11. Survival of Certain Provisions. The representations and warranties, indemnification and contribution provisions and other agreements of the Purchaser contained in this Agreement shall remain operative and in full force and effect regardless of (i) the making, withdrawal or termination, or consummation of, or failure to commence, the Offer, (ii) any investigation made by or on behalf of any Indemnified Person or (iii) any termination of this Agreement. 12. Successors and Assigns, Etc. This Agreement, including, without limitation, any right to indemnification, shall be binding upon you and the Purchaser, and the respective successors and assigns thereof, and shall inure to the benefit of the Purchaser, you and the other Indemnified Persons, and the respective successors and assigns thereof. Nothing in this Agreement is intended, or shall be construed, to give to any other person or entity any right under or by virtue of this Agreement. First Southwest Company January 13, 1995 13. Miscellaneous. In the event that any provision of this Agreement shall be determined to be invalid or unenforceable in any respect, such determination shall not affect such provision in any other respect or any other provision of this Agreement, which shall remain in full force and effect. This Agreement may be executed in one or more separate counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 14. Notices. Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be mailed by certified mail, return receipt requested, or delivered against receipt to the party to whom it is to be given at the address of such party as set forth below: To the Purchaser: City of Round Rock, Texas 221 East Main Street Round Rock, Texas 78664 Attention: Mr. Steve Sheets, City Attorney To First Southwest Company: First Southwest Company 98 San Jacinto Boulevard 370 San Jacinto Center Austin, Texas 78701 Attention: George Janning 15. Confidentiality. The Purchaser agrees not to disclose the provisions of this Agreement to any other person unless it reasonably determines that the failure to make such disclosure would violate applicable law or otherwise materially adversely affect its interest. 16. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas. First Southwest Company January 13, 1995 Please indicate your willingness to act as Dealer Manager and your acceptance of the foregoing provisions by signing in the space provided below for that purpose and returning to us a copy of this Agreement so signed, whereupon this Agreement and your acceptance shall constitute a binding agreement between us. Accepted on the date first above written: FIRST SOUTHWEST COMPANY By: Name: / 9 /2. Ar 6q Title: f}ffa c/4re- Very truly yours, CITY OF ROUND ROCK, TEXAS By: � & N4 ame: Title: THE STATE OF TEXAS $ CITY OF ROUND ROCK $ CERTIFICATE FOR RESOLUTION We, the undersigned officers of the City of Round Rock, Texas (the "City"), hereby certify as follows: 1. The City Council of the City (the "Council ") convened in REGULAR MEETING ON THE 22ND DAY OF DECEMBER, 1994, at the City Hall (the "Meeting "), and the roll was called of the duly constituted officers and members of the City, to wit: Charles Culpepper, Mayor Robert Stluka, Mayor Pro-Tem Rod Morgan, Councilmember Rick Stewart, Councilmember Earl Palmer, Councilmember Jimmy Joseph, Councilmember Martha A. Chavez, Councilmember Robert Bennett, City Manager Joanne Land, Asst. City Manager /City Secretary David Kautz, Director of Finance and all of the persons were present, except the following absentees: None, thus constituting a quorum. Whereupon, among other business, the attached Resolution was duly introduced for the consideration of the Council. It was then duly moved and seconded that the Resolution be adopted; and, after due discussion, the motion carrying with it the adoption of the Resolution, prevailed and carried by the following vote: 2. A true, full and correct copy of the aforesaid Resolution passed at the Meeting described in the above and foregoing paragraph is attached to and follows this Certificate; that the Resolution has been duly recorded in the Council's minutes of the Meeting; that the above and foregoing paragraph is a true, full and correct excerpt from the Council's minutes of the Meeting pertaining to the passage of the Resolution; that the persons named in the above and foregoing paragraph are the duly chosen, qualified and acting officers and members of the Council as indicated therein; that each of the officers and members of the Council was duly and sufficiently notified officially and personally, in advance, of the time, place and purpose of the aforesaid Meeting, and that the Resolution would be introduced and considered for passage at the Meeting, and each of the officers and members consented, in advance, to the holding of the Meeting for such purpose; that the Meeting was open to the public and public notice of the time, place and purpose of the Meeting was given, all as required by Chapter 551, Government Code, as amended. MOCK: SUPPRES.CRT 1 AYES: All Present Voted Aye NOES: None SIGNED AND SEALED this aka /S 9 `/ (SEAL) 94- RESOLUTION APPROVING FORM OF DISCLOSURE DOCUMENT IN CONNECTION WITH OUTSTANDING CITY OF ROUND ROCK, TEXAS GOLF COURSE TRUST CERTIFICATES, SERIES 1989, DISTRIBUTION OF DISCLOSURE DOCUMENT AND OTHER MATTERS RELATED THERETO WHEREAS, there are currently outstanding $6,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates ") issued pursuant to a Trust Agreement dated as of December 1, 1989 (the "Trust Agreement ") which evidence proportional interests in certain lease payments pursuant to a Lease Agreement dated as of December 1, 1989 (the "Lease Agreement ") by and between the City, as lessee and Round Rock Golf, Inc., as lessor; and WHEREAS, such Certificates were issued in connection with the acquisition, construction and financing of a public golf course within the City; and WHEREAS, the City is considering various strategic alternatives related to the financing of the golf course; and WHEREAS, attached hereto is a substantially final form of an Invitation to Tender and Solicitation for Consent and various related documents (collectively, the "Disclosure Document ") which sets forth the options the City is considering regarding the outstanding Certificates; and WHEREAS, Morgan Stanley & Co. Incorporated is serving as Dealer Manager and Frost National Bank is serving as tender agent in connection with the Disclosure Document. WHEREAS, the City deems it advisable and necessary at this time to authorize its consultants to distribute the Disclosure Document and to do all things necessary in connection therewith. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ROUND ROCK, TEXAS: Section 1. Approval and Distribution. The recitals set forth in the preamble hereof and incorporated by reference herein shall have the same force and effect as if set forth in this Section. The City hereby approves the Disclosure Document in substantially the form attached hereto with such changes, additions or deletions as directed by the City Manager and the City's consultants are hereby authorized and directed to distribute the Disclosure Document to the owners of the Certificates and such other market participants as deemed necessary and advisable. Section 2. Approval of Dealer Manager Agreement and Tender Agent Agreement. The City hereby approves the Dealer Manager Agreement and Tender Agent Agreement in substantially the form attached hereto. The Mayor or City Manager are hereby authorized to RROCK/CAIP: DISCLOSURES 12/01/94 execute such agreements and the City Secretary is hereby authorized to attest such agreements. The City Manager is hereby authorized to complete, amend and modify such agreements as necessary. Section 3. Further Procedures. The Mayor or City Manager and City Secretary of the City, the Director of Finance of the City and all other officers, employees and agents of the City, including the City's Financial Advisor and attorneys, and each of them, shall be and they are hereby expressly authorized, empowered and directed from time to time and at any time to do and perform all such acts and things to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the City all instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Resolution, the First Supplemental Trust Agreement and First Supplemental Lease Agreement, the amendment of such agreements and other matters in connection therewith. RROCR/COLP: DI9CLO.AI.RPS 12/01/94 December 23,.- -1994 Dear Certificateholders: Mayor Charles Culpepper Mayor Pro -tern Robert Stluka Council Members Rod Morgan Rick Stewart Earl Palmer Martha Chaves Jimmy City Manager Robert L. Bennett, ✓r. City Attorney Stephan L. Sheets As reported to the public in early October, the Golf Course (which is the sole source of revenues for the Certificates) has lost money in each year of operation. thing is done, a payment default on the Certificates may occur during 1995. to keep the golf course in operation, we are proposing a financial restructuring of this plan, the City is willing to purchase the Certificates from d*rs who wish to sell their investment at a price to be announced on or about 5. We are also asking all Certificateholders to consent to an amendment to t and lease agreement. Please understand we are not in a position to guarantee that we will complete this restructuring plan. Unless a sufficient number of holders tender their Certificates, we may not purchase anyone's Certificates. If our restructuring plan proves unsuccessful, we cannot guarantee that the principal and interest on the Certificates will be paid. As the original prospectus for the Certificates warned, the Certificates are backed solely by the revenues from the Golf Course, without any backing from the City, or from the State of Texas, or any other governmental entity. Writing this letter is difficult particularly since one is always afraid that important points may not have been covered. With this in mind, I urge you to read all of the attached materials, which include the Invitation to Tender and Solicitation for Consent dated December 23, 1994, Letter of Transmittal and Instruction Form. This letter is entirely qualified to the contents of those materials. Please read all of these materials carefully and consult your professional advisors, brokers or other financial professionals for advice on a course of action to follow. If you have any questions about this please call Richard Jacovitz at Fiduciary Communications Company, Inc. at 800- 365 -BOND (800 - 365- 2663). Since obert L. t'ennett, Jr., AIC City Manager Attachments THE CITY OF ROUND ROCK 221 Rast Main Street Round Rock, Texas 78664 612 -255 -3812 Fax 512 -255 -6676 1-800-735-2989 (TDD) 1- 800 - 735 - 2988 (Voice) Maturity Date _ Coupon Principal Outstanding CUSIP # l 12/1/96 8.50% $140,000 779228 AA3 12/1/97 8.75% 5155,000 779228 AB1 12/1/98 9.00% $165,000 779228 AC9 12/1/99 9.10% $180,000 779228 AD7 12/1/00 9.20% $200,000 779228 AE5 12/1/01 9.30% $215,000 779228 AF2 12/1/02 9.40% $235,000 779228 AGO 12/1/03 9.50% $260,000 779228 A118 12/1/04 9.50% $280,000 779228 AJ4 12/1/05 9.50% $310,000 779228 AK1 12/1/14 10.00% $4,600,000 779228 AU9 The CUSIP numbers are included solely for the convenience of the holders. '! Neither the City nor the Trustee shall be responsible for the selection or the use of the CUSIP numbers, nor is any representation made as to their correctness on the securities. To Our Clients: Invitation to Tender and Solicitation for Consent Relating to: CITY OF ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 December 23, 1994 Enclosed for your consideration is an Invitation to Tender and Solicitation for Consent dated December 23, 1994, and Instruction Form (collectively, the "Invitation ") relating to an invitation by the City of Round Rock, Texas (the "City ") to submit offers to sell your Certificates of the above - captioned issue (the "Certificates "). They also ask for your consent to the amendment of certain financing documents or to only consent to the amendment of certain financing documents. We presently hold Certificates for your account. Your offer to sell your Certificates and /or consent to the amendments can be made only by us as the holder on the records of Frost National Bank, as Trustee, and pursuant to your instructions. We request instructions from you as to whether you wish to (i) offer to sell to the City any or all of the Certificates held by us for your account, pursuant to the terms and conditions set forth in the Invitation attached hereto and consent to the amendment of certain financing documents or (ii) consent to the amendment of certain financing documents only as set forth in the Invitation and the Consent Form. Please provide your instructions on the Instruction Form attached hereto. Your attention is invited to the following: 1. The purchase price for the Certificates will be established on or about the week of January 9, 1995 and will be made available by mailing (via first -class mail) to the registered holders, through the Munifacts Wire System, Bloomberg News Service, Dow Jones News System and the Information Agent. The purchase price will also be posted in Redemption Digest and Securities Industry Daily. First Southwest Company, financial advisor to the City, will assist the City in determining the purchase price for the Certificates; and 2. The Invitation expires on Wednesday, February 1, 1995 at 5:00 p.m., New York, New York time, unless earlier terminated or extended by the City. Your instructions should be forwarded to us promptly to permit us to submit an offer to sell your Certificates on your behalf prior to the expiration of the Invitation. INSTRUCTION FORM CITY OF ROUND ROCK, TEXAS Invitation to Tender and Solicitation for Consent Relating to: CITY OF ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 I acknowledge receipt of your letter, the Invitation and Solicitation for Consent of the City of Round Rock, Texas (the "City "), dated December 23, 1994, and the purchase price information regarding the certificates (collectively, the "Invitation "), relating to the certificates of the above - captioned issue (the "Certificates "). Please check the appropriate box. ❑ This instructs you to (i) offer to sell and tender my Certificates in the principal amount of $ held by you for me and (ii) consent to the amendments to the financing documents on the terms and subject to the conditions in the Invitation and herein. ❑ This instructs you to consent to the amendments to the financing documents only. I hereby acknowledge that the (i) purchase of and payment for all Certificates tendered and (ii) consent to certain amendments of the financing documents are subject to the terms and conditions set forth in the Invitation dated December 23, 1994 receipt of which is hereby acknowledged and I have carefully reviewed and understand the Invitation. Please Print Names: Address(es) ( ) Telephone Number Date: Address(es) DELIVER THIS INSTRUCTION SHEET IMMEDIATELY (BY FAX OR OTHERWISE) TO YOUR BANK OR BROKER Signature(s) Taxpayer I.D. Number (Social Security Number) The undersigned, as the registered Certifica(eholder of the following described City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates ") on behalf of myself (ourselves), my (our) heirs, designees, legates, successors and assigns, do hereby expressly consent to the First Supplemental Trust Agreement dated January 1, 1995 and First Supplemental Lease Agreement dated January 1, 1995 as attached to the Proposed Resolution entitled Resolution Approving First Supplemental Trust Agreement and First Supplemental Lease Agreement Dated this Certificate Number(s) Maturity Date(s) Principal Amount(s) Exact name(s) appearing on the Certificate(s) Note: Attach additional list if necessary. CONSENT FORM Consent to First Supplemental Trust Agreement and First Supplemental Lease Agreement for City of Round Rock, Texas Golf Course Trust CertifiCates, Series 1989 Owner(s) (or attorneys or agents appointed by an instrument in writing attached hereto) Owners must sign exactly as the name(s) appears on the Certificates S ri I < r. T ��. . . � 1 IL, ,,, !_ ,� - '11' 830% $140.000 779228 AA3 3 . .411 f_._ l 12/1/98 9.00% $165 779228.40) 779228A177 12/1/99 9.10% 3180.000 '11 ti 1. 1,,I di A a rl AGO t ': . . �1 ,, l � 1' 'f�fk 12/1/ 05 930!0 $310.000 779228 AK1 12/1/14 10.00% $4.600.000 779228 A1.19 The CUSIP numbers are included solely for the convenience of the holders. Neither the City nor theTri .tee.hal1beresponsibleffrthe selection or the LLSe ftheCUS/Pnwnher.. nor is any representation }trade as to their correctness on the securities. CITY OF ROUND ROCK, TEXAS Invitation to Tender and Solicitation for Consent Relating to: CITY OF ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1,1989 December 23, 1994 SOLICITATION FEE PAYABLE TO BANKS, BROKERS, DEALERS AND OTHER NOMINEES: $15.00 PER $5,000 EXPIRATION DATE: 5:00 NEW YORK TIME, WEDNESDAY, FEBRUARY 1, 1995 TO BROKERS, DEALERS, COMMERCIAL BANKS TRUST COMPANIES OR OTHER NOMINEES: The City of Round Rock, Texas (the "City") is enclosing herewith the materials relating to the (i) invitation by the City for holders to submit the above captioned certificates (the "Certificates ") for purchase by the City upon the terms and subject to the conditions set forth in the Invitation to Tender and Solicitation for Consent, Letter of Transmittal and in the instruction form (the "Instruction Form ") and (ii) solicitation of the consent to certain amendments to the financing documents as set forth in the Invitation and the consent form (the "Consent Form "). The Invitation to Tender and Solicitation for Consent, Letter of Transmittal, Instruction Form and the Consent Form, are collectively referred to as the Invitation. WE URGE YOU TO CONTACT YOUR CLIENTS PROMPTLY (Continued on next page...) (...continued from previous page) We are asking you to contact your clients for whom you hold Certificates registered in their name or in the name of your nominee. Please bring the Invitation to their attention as soon as possible. Upon your receipt of a properly executed Instruction Form from your client instructing you to submit Certificates for tender at the purchase price offered by the City per $5,000 in outstanding principal amount (as communicated on or about the week of January 9, 1995 as set forth in the Invitation to Tender and Solicitation for Consent) and/ or to consent to certain amendments you must on or prior to February 1,1995 (the "Expiration Date ") transmit the tender and consent or consent only, as applicable, to Frost National Bank, as Tender Agent, in certificated form or through the Automated Tender Offer Program (ATOP) of The Depository Trust Company. Enclosed herewith are copies of the following documents: 1. Invitation to Tender and Solicitation for Consent dated December 23, 1994 (white booklet); 2. Letter which may be sent to your clients or customers for whose account you hold Certificates in your name or in the name of the nominee (yellow form), 3. Client Instruction Form ( yellow form). PLEASE NOTE THAT THE INVITATION EXPIRES AT 5:00 P.M., NEW YORK, NEW YORK TIME ON WEDNESDAY, FEBRUARY 1,1995, UNLESS EARLIER TERMINATED OR EXTENDED Additional copies of the enclosed material may be obtained from the Information Agent, Fiduciary Communications Company, Inc., Attention: Richard Jacovitz, 149 Franklin Street, 2nd Floor, New York, New York 10013, (212) 226 -3444 or by calling 1- 800 - 365 -BOND (1 -800- 365 -2663) (toll free). Very truly yours, City of Round Rock, Texas NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTI- TUTE YOU OR ANY PERSON AS AN AGENT OF THE CITY, THE TENDER AGENT, THE DEALER MANAGER OR THE INFORMATION AGENT OR AUTHORIZE YOU OR ANY OTHER PERSON TO GIVE ANY INFORMATION OR TO MAKE ANY STATEMENTS OR USE ANY DOCUMENTS IN CONNECTION WITH THE INVITATION OTHER THAN THE DOCU- MENTS ENCLOSED HEREWITH AND STATEMENTS CONTAINED HEREIN. MaturityDate Coupon CUSIP # 12/1/96 8.50% 779228 AA3 Use This Letter of Transmittal to tender your Certificates maturing December 1, 1996 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent. The Offer will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank By Mail: v Facsimile: Frost National Bank (713) 651-5015 Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 For Information CaIk James Rankin (713) 651 -5018 By Express Mail or Hand Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHER NOMINEE, DO NOT COMPLETE THIS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. IMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must be received by the Tender Agent prior to the Expiration Date ofthe Invitation. For Certificates held in "Street Name "through banks and brokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions or requests for assistance or additional copies ofthe Invitation or the Letter of Transmittal maybe directed to the Information Agent at the telephone number and location listed below. The Dealer Manager for this Invitation is Morgan Stanley &Co.,Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800 - 365 -BOND (800- 365 -2663) )?LEASE READ THE INSTRUCTIONS ON THE REVERSE SIDE CAREFULLY (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART I. Enclosed are my "City of Round Rock, Texas Golf Course Trust Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the terms and conditions set forth in the "Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and in this Letter of Transmittal (collectively, the "Invitation "). I also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (i) purchase of and payment for all Certificates tendered hereby and (ii) the consent to certain amendments of the financing documents are subject to the terms and conditions set forth in the Invitation receipt of which Is hereby acknowledged and I have carefully reviewed and understand such Invitation. The undersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART II. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please mark any cofections to the label attached hereto.) CERTIFICATE(S) ENCLOSED (If more room is needed, attach a signed list.) Certificate No.(sl Principal Amount Tendered SIGN HERE Dated: Signature(s) of Owner(s) PART III. [THIS SECTIONNQ[TO BE COMPLETED BY HOLDER- TO BE COMPLETED BY BANK, BROKER, DEALER OR TRUST COMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial bank or trust company having an office, branch or agency in the United States which solicited and obtained this tender is: Name of Firm: (Please Print) Name of Individual, Broker or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial bank or trust company will constitute a representation that (r) it has complied with and will comply with the applicable requirements of the Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has used no solicitation materials other than the Invitation and (iii) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal is at the election and risk of the tendering holder. Il is recommended that the Certificates be delivered by Express Mail,Federal Express or other similar courier service, properly insured, in sufficient lime to permit receipt by the Tender Agent prior to the Expiration Date. Iris also recommended the holder maintain the shipping receipL For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651 -5018. PART V. IMPORTANT TAX INFORMATION WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Cenifcates for purchase may be subject to a withholding tax at a rate of 31% if such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury, Certification may be made to the Tender Agent on the Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check the boxes that apply to the Certificateholder (one box must be checked): The Certificateholder is not or is no longer subject to backup withholding. The Certificateholder has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest or dividends. The Certificateholder is awaiting a new TIN from the IRS. CERTIFICATION -UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT THEINFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature Holder's Social Security Number or TIN MaturityDate Coupon CUSIP # 12/1/97 8.75% 779228 AB] Frost Notional Bank Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 Use This Letter of Transmittal to tender your Certificates maturing December 1, 1997 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent- The Offer will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank By Facsimile: (713) 651 -5015 For Information Call: James Rankin (713)651 -5018 By Express Mail or Hand Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHER NOMINEE, DONOT COMPLETE THIS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. IMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must be received by the Tender Agent prior to the Expiration Date of the Invitation. For Certificates held in "StreetName "throughbanks andbrokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions orrequests forassistanceor additional copies ofthelnvitation or theLetter of Transmittal maybe directedto the Information Agent at the telephone number and locationlistedbelow. The Dealer Manager for this Invitation is Morgan Stanley & Co.,Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800 - 365 -BOND (800- 365 -2663) PLEASE READ THE INSTRUCTIONS ON THE REVERSE SIDE CAREFULLY (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART I. Enclosed are my "City of Round Rock, Texas Golf Course Trust Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the terms and conditions set forth in the' Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and In this Letter of Transmittal (collectively, the "Invitation "). I also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (i) purchase of and payment for all Certificates tendered hereby and (ii) the consent to certain amendments of the financing documents are subject to the terms and conditions set forth in the Invitation receipt of which is hereby acknowledged and I have carefully reviewed and understand such Invitation. The undersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART II. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please mark any corrections to the label attached hereto.) CERTIFICATE(S)ENCLOSED (If more room is needed, attach a signed list.) Certificate No.(s) Principal Amount Tendered SIGN HERE Dated: Signature(s) of Owner(s) PART III. [THIS SECTIONNOTTO BE COMPLETED BY HOLDER- TO BE COMPLETED BY BANK, BROKER, DEALER OR TRUST COMPANY THAT SOLICITED TENDER] The undersigned represents that Inc member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial bank or trust company having an office, branch or agency in the United States which solicited and obtained this tender is: Name of Firm: (Please Print) Name of Individual, Broker or Batik Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial bank or trust company will constitute a representation that (1) it has complied with and will comply with the applicable requirements of Inc Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has used no solicitation materials other than the Invitation and (iii) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal is at the election and risk of the tendering holder. Itis recommended that the Certificates be delivered byExpressMall, Federal Express or other similar courier service, properly Insured, in sufficient time to permit receipt by the Tender Agent prior to the Expiration Date. It is also recommended the holder maintain the shipping receipt. For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651 -5018. PART V. IMPORTANT TAX INFORMATION WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax at a rate of 31% if such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury. Certification may be made to the Tender Agent on Inc Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check Inc boxes that apply to the Cenificateholder (one box must be checked): The Certificateholder is not or is no longer subject to backup withholding. The Certificatcholder has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest or dividends. The Certificateholder Is awaiting a new TIN from the IRS. CERTIFICATION - UNDERTHE PENALTIES OF PERJURY, I CERTIFY THAT THE INFORMATION PROVIDED ON TFIIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature Holder's Social Security Number or TIN MaturityDate Coupon CUSIP # 12/1/98 900% 779228 AC9 Use This Letter of Transmittal to tender your Certificates maturing December 1, 1998 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent. The Offer will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank By Mail: By Facsimile: Frost National Bank (713) 651 -5015 Corporate Trust Department Attention: James Rankin P.D. Box 3856 Houston, Texas 77253 For Information Call: James Rankin (713) 651-5018 $v Express Mail or Hand Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHER NOMINEE, DO NOT COMPLETE THIS LE 11ER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. IMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must be received by the Tender Agent prior to the Expiration Date of the Invitation. For Certificates held in "Street Name" throughbanks and brokersthrough The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions or requests for assistance or additional copies ofthelnvitation or theLetter of Transmittal maybe directed tothe Information Agent at the telephone number and location listed below. TheDealer Manager for this Invitation isMorgan Stanley& Co., Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800- 365 -BOND (800- 365 -2663) PLEASE READ THE INSTRUCTIONS ON THE REVERSE SIDE CAREFULLY (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART I. Enclosed are my "City of Round Rock, Texas Golf Course Trust Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the teens and conditions set forth in the "Invitation To 'fender and Solicitation for Consent" dated December 23, 1994 and in this Lester of Transmittal (collectively, the "Invitation "). I also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (t) purchase of and payment for all Certificates tendered hereby and (ii) the consent to certain amendments of the financing documents are subject to the terms and conditions set forth in the Invitation receipt of which is hereby acknowledged and I have carefully reviewed and understand such Invitation. The undersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART II. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please mark any corrections to the label attached hereto.) CERTIFICATE(S) ENCLOSED (If more room is needed, attach a signed list.) Certificate No (s) Principal Amount Tendered SIGN HERE Dated' Signatures) of Owner(s) PART III. [THIS SECTIONS TO BE COMPLETED BY HOLDER -TOBE COMPLETED BY BANK,BROIOSR, DEALER ORTRUSTCOMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial bank or trust company having an office, branch or agency in the United States which solicited and obtained this tender is: Name of Firm: (Please Print) Name of Individual, Broker or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial bank or trust company will constitute a representation that (1) it has complied with and will comply with the applicable requirements of the Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has used no solicitation materials other than the Invitation and (iii) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal Is at the election and risk of the tendering holder. It is recommended that the Certificates be delivered by Express Mail, Federal Express or other similar courier service, properly insured, in sufficient time to permit receipt by the Tender Agent prior to the Expiration Date. It is also recommended the holder maintain the shipping receipt. For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651-5018. PART V. IMPORTANT TAX INFORMATION WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax at a ram of 31% if. such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury. Certification may be made to the Tender Agent on the Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check the boxes that apply to the Certificateholder (me box must be checked): The Certificateholder is not or is no longer subject to backup withholding. The Certificateholder has been notified by rite IRS that he or she is subject to backup withholding for failure to report all interest 01 dividends. The Certificateholder is awaiting a new TIN from the IRS. CERTIFICATION - UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT THE INFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature Holder's Social Security Number or TIN MaturityDate Coupon CUSIP # 1211199 9.10% 779228 AD7 Use This Letter of Transmittal to tender your Certificates maturing December 1, 1999 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent. The Offer will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank 'y Mail By Facsimile: Frost National Bank (713) 651 -5015 Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 For Information Cali: James Rankin (713) 651 -5018 Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHERNOMINEE, DO NOT COMPLETE THIS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. DIPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must be received by the Tender Agent prior to the Expiration Date of the Invitation. For Certificates held in"S treet Name "through banks and brokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions or requests for assistance or additional copies of the Invitation or the Letter ofTransmittal maybe directed to the Information Agent at the telephone number and location listed below. TheDealerManagerforthisInvitationisMorgan Stanley & Co., Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800- 365 -BOND (800- 365 -2663) PLEASE READ THE INSTRUCTIONS ON THE REVERSE SIDE CAREFULLY (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART I. Enclosed are my "City of Round Rock, Texas Golf Course Trust Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the terms and conditions set forth in the "Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and in this Letter of Transmittal (collectively, the "Invitation "). I also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (1) purchase of and payment for all Certificates tendered hereby and (it) the consent to certain amendments of the Financing documents are subject to the terms and conditions not forth in the Invitation receipt of which is hereby acknowledged and I have carefully reviewed and understand such Invitation. The undersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART II. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder. (Please mark any corrections to the label attached hereto.) CERTIFICATE(S) ENCLOSED (If more room is needed, attach a signed list) Certificate No Is) Principal Amount Tendered SIGN HERE Dated: Signature(s) of Owner(s) PART III. [THIS SECTIONNOTTO BE COMPLETED BY HOLDER- TO BE COMPLETED BY BANK, BROKER, DEALER ORTRUSTCOMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial bank or trust company having an office, branch or agency in the United States which solicited and obtained this tender is: Name of Firm: (Please Print) Name of Individual, Broker or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial bank or trust company will constitute a representation that (I) it has complied with and will comply with the applicable requirements of the Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has used no solicitation materials other than the Invitation and (iii) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal is at the election and risk of the tendering holder. his recommended that the Certificates be delivered by Express Mail, Federal Express or other simflar courier service, properly insured, in sufficient time to permit recelptby the Tender Agent prior to the Expiration Date. Itis also recommended the holder maintain the shipping receipt For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651-5018. PART V. IMPORTANT TAX INFORMATION WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax at a rate of 31% if such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury. Certification may be made to the Tender Agent on the Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer identification Number (TIN) or Social Security Number Please check the boxes that apply to the Certificateholder (one box must be checked); The Certificateholder is not or is no longer subject to backup withholding. The Certificateholder has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest or dividends. The Certificateholder is awaiting a new TIN from the IRS. CERTIFICATION - UNDER THE PENALTIES OF PERJURY, I CERTIFY THATTHEINFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature Holder's Social Security Number or TIN MaturityDate Coupon CUSIP # 12/1/00 9.20% 779228 AE5 Use This Letter of Transmittal to tender your Certificates maturing December 1, 2000 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent. The Offer will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank &Mail: BJFa Frost National Bank (713) 651 -5015 Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 For Information Call: James Rankin (713) 651-5018 By Express Mail or Hart& Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHER NOMINEE, DO NOT COMPLETE THLS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. IMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must be received by the Tender Agent prior to the Expiration Date of the Invitation. For Certificates held in "StreetName" throughbanks andbrokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions or requests for assistance or additional copies ofthe Invitation or the Letter of Transmittal maybe directed to the Information Agent at the telephone number and location listed below. The Dealer Manager for this Invitation is Morgan Stanley &Co .,Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800- 365 -BOND (800365 -2663) FI EASE READ THE INSTRUCTIONS ON THE REVERSE SIDE CAREFULLY (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART I. Enclosed are my "City of Round Rock, Texas Golf Course Trost Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the terms and conditions set forth in the "Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and in this Letter of Transmittal (collectively, the "Invitation "). I also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (t) purchase of and payment for all Certificates tendered hereby and (ii) the convent to certain amendments of the financing documents are subject to the terms and conditions set forth in the Invitation receipt of which is hereby acknowledged and I have carefully reviewed and understand such Invitation. The undersigned aLsohereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART II. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please mark any corrections to the label attached hereto.) CERTIFICATE(S) ENCLOSED (If more room is needed, attach a signed list.) Certificate No (s) Principal Amount Tendered PART V. IMPORTANT TAX INFORMATION SIGN HERE Dated: Signature(s) of Owner(s) PART III. [THIS SECTIONNOTTO BE COMPLETED BY HOLDER- TO BE COMPLETED BY BANK, BROKER, DEALER OR TRUST COMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial bank or trust company having an office, branch or agency in the United States which solicited and obtained this tender is: Name of Firm: (Please Print) Name of Individual, Broker or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial bank or trust company will constitute a representation that (i) it has complied with and will comply with the applicable requirements of the Securities Exchange Act of 1934, as amended, and the applicable roles and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has used no solicitation materials other than the Invitation and (iii) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal is at the election and risk of the tendering holder. It is recommended that the Certificates be delivered by Express Mail, Federal Express or other similar courier service, properly insured,in sufficient time to permit receipt by the Tender Agent prior to the Expiration Date. It is also recommended the holder maintain the shipping receipt_ For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651 -5018. WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income lax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax at a rate of 31% if such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury. Certification may be made to the Tender Agent on the Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check the boxes that apply to the Certificateholder (one box must be checked): The Cerlificateholdcr is not or is no longer subject to backup withholding. The Certificaleholder has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest or dividends. The Certificaleholder is awaiting a new TIN from the IRS. CERTIFICATION. UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT THEINFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature !Inkier' s Social Security Number or TIN MaturityDate Coupon CUSIP # 12/1101 9.30% 779228 AF2 Use This Letter of Transmittal to tender your Certificates maturing December 1, 2001 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent. The Offer will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank By MIL BJ Facsimile: Frost National Bank (713) 651 -5015 Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 For Information Call: James Rankin (713) 651-5018 &y wrecs Mail of hand Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHERNOMINEE, DO NOT COMPLETE THIS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. IMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other requ documents) must be received by the Tender Agent prior to the Expiration Date of the Invitation. For Certificates held in "StreetName" throughbanks andbrokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions or requests for assistance or additional copies ofthe Invitation or the Letts of Transmittal maybe directed to the Information Agent at the telephone number and location listed below. The Dealer Manager for this Invitation is Morgan Stanley & Co., Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800- 365 -BOND (800- 365 -2663) PLEASE READ THE INSTRUCTIONS ON THE REVERSE SIDE CAREFULLY (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART I. Enclosed are my "City of Round Rock, Texas Golf Course Trust Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the terms and conditions set forth in the "Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and in this Letter of Transmittal (collectively, the "Invitation "). I also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (1) purchase of and payment for all Certificates tendered hereby and (B) the consent to certain amendments of the financing documents are subject to the terms and conditions set forth In the Invitation receipt of which Is hereby acknowledged and I have carefully reviewedand understand such Invitation. Theundersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART II. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please mark any corrections to the label attached hereto.) CERTIFICATE(S) ENCLOSED (If more room is needed, attach a signed list,) Certificate No Is) Principal Amount Tendered SIGN HERE Dated: Signature(s) of Owner(s) PART III, [THIS SECTION(_yQTTOBECOMPLETED BY HOLDER- TO BE COMPLETED BYBANK ,BROKER,DEALER ORTRUSTCOMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial bank or trust company having an office, branch or agency in the United States which solicited and obtained this tender is: Name of Firm: (Please Print) Name of Individual, Broker or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial bank or trust company will constitute a representation that (1) it has complied with and will comply with the applicable requirements of lie Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (11) in soliciting tenders it has used no solicitation materials other than the Invitation and (iii) it 0 entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal is at the election and risk of the tendering holder. It is recommended that the Certificates be delivered by Express Mall, Federal Express courier service, properly insured, in sufficient time to permit receipt by the Tender Agent prior to the Expiration Date. Itls also recommended the holder maintain the shipping receipt. For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651 -5018. PART V. IMPORTANT TAX INFORMATION WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax at a rate of 31% if such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury. Certification may be made to the Tender Agent on the Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check the boxes that apply to the Certificateholder (one box must be checked): The Certificateholder is not or is no longer subject to backup withholding. The Certificateholder has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest or dividends. The Certificateholder is awaiting a new TIN from the IRS. CERTIFICATION- UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT THE INFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature Holder's Social Security Number or TIN MaturityDate Coupon CUSH' # 12/1/02 9.40% 779228 AGO Use This Letter of Transmittal to tender your Certificates maturing December 1, 2002 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent. The Offer will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank By Maik By Facsimile: Frost National Bank (713) 651 -5015 Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 For Information CaIL• James Rankin (713) 651-5018 By Earpress Mail or Hand Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHER NOMINEE, DO NOT COMPLETE THIS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. LMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must be received by the Tender Agent prior to the Expiration Date of the Invitation. Any questions or requests for assistance or additional copies ofthelnvitation or the Letter of Transmittal maybe directed to the information Agent at the telephone number and location listed below. The Dealer Manager for this Invitation is Morgan Stanley & Co., Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. SERE For Certificates held in "StreetName "throughbanks and brokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800 - 365 -BOND (800- 365 -2663) STRUC IONS REVERSE I:L 1 l.1' (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE FULL PART I. Enclosed are my "City of Round Rock, Texas Golf Course Trust Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the terms and conditions set forth in the "Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and in this Letter of Transmittal (collectively, the "Invitation "). I also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (1) purchase of and payment for all Certificates tendered hereby and (ii) the consent to certain amendments of the financing documents are subject to the terms and conditions set forth in the Invitation receipt of which is hereby acknowledged and] have carefully reviewed andunderstand suchlnvitation. Theundersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART IL DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please mark any corrections to the label attached hereto.) CERTIFICATES) ENCLOSED (If more room is needed, attach a signed list.) Certificate No (s) Principal Amount Tendered SIGN HERE Dated: Signature(s) of Owner(s) PART III. [THIS SECTIONNOTTO BE COMPLETED BY HOLDER- TOBE COMPLETED BYBANK, BROKER, DEALERORTRUSTCOMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial bank or trust company having an office, branch or agency in the United Stales which solicited and obtained this lender is: Name of Firm: (Please Print) Name of Individual, Broker or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial bank no trust company will constitute a representation that (1) it has complied with and will comply with the applicable requirements of the Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has used no solicitation materials other than the Invitation and (iii) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal is at the election and risk of the tendering holder. It is recommended that the Certificates be delivered by Express Mail, Federal Express or other similar courier service, properly insured, in sufficient time to permit receipt by the Tender Agent prior to the Expiration Date. It is also recommended the holder maintain the shipping receipt For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651 -5018. PART V. IMPORTANT TAX INFORMATION WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax at a rate of 31% if such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury. Certification may be made to the Tender Agent on the Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check the boxes that apply to the Certificateholder (one box must be checked): The Certificatcholder is not or is no longer subject to backup withholding. The Certificateholdcr has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest or dividends. The Certificatcholder is awaiting a new TIN from the IRS. CERTIFICATION -UNDER THE PENALTIES OF PERJURY, I CERTIFY THATTHEINFORMATION PROVIDEDON TIIIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature Holder's Social Security Number or TIN MaturityDate Coupon CUSIP # 12/1/03 9.50% 779228 AH8 Use This Letter of Transmittal to tender your Certificates maturing December 1, 2003 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent. The Offer will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank ByMaiL• ByFaesimilee: Frost National Bank (713) 651 -5015 Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 For LnJormation Call: James Rankin (713) 651-5018 By &j ess Mail or Hand Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHER NOMINEE, DO NOT COMPLETE THIS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. IMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must be received by the Tender Agent prior to the Expiration Date of the Invitation. For Certificates held in "Street Name "through banks and brokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions or requests for assistance or additional copies ofthe Invitation or the Letter of Transmittal may be d rectedto the Information Agent at the telephone number and location listed below. The Dealer Manager for this lnvitationis Morgan Stanley &Co.,Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Ca11 Toll Free: 800 - 365 -BOND (800- 365 -2663) E CAREFU ti • ' t I t• • 7p STRUC IONS 0 REVE PLEASE AD (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART I. Enclosed arc my "City of Round Rock, Texas Golf Course Trust Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the terms and conditions net forth in the "Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and in this Letter of Transmittal (collectively, the "Invitation "). I also hereby consent to the amendments described in the Invitation, The undersigned hereby acknowledges that the (1) purchase of and payment for all Certificates tendered hereby and (D) the consent to certain amendments of the financing documents are subject to the terms and conditions set forth in the Invitation receipt of which is hereby acknowledged and I have carefully reviewed and understand such Invitation. The undersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART II. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please [nark any corrections to the label attached hereto.) CERTIFICATE(S) ENCI.OSED (If more room is needed, attach a signed list.) Certificate NQ(s) Principal Amount Tendered SIGN HERE Dared: Signature(s) of Owner(s) PART III. [THIS SECTIONNOTTO BECOMPLETEDBY HOLDER- TO BE COMPLETED BY BANK, BROKER,DEALEROR TRUST COMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial hank or trust company having an office, branch or agency in the United States which solicited and obtained this tender is: Name of Firm: (Please Print) Name of Individual, Broker or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial hank or trust company will constitute a representation that (i) it has complied with and will comply with thc applicable requirements of the Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has used no solicitation materials other than the Invitation and (iii) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal is at the election and risk of the tendering holder. It is recommended that the Certificates be delivered by Express Mall, Federal Express or other similar courier service, properly insured, insufficient time to permit receipt by the Tender Agent priortutbe Expiration Date. It Is also recommended the holder maintain the shipping receipt. For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651 -5018. PART V. IMPORTANT TAX INFORMATION WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER 011 SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax at a tale of 31% if such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury. Certification may be made to the Tender Agent on the Substitute Form W -9 below, SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check the boxes that apply to thc Certificateholder (one box must be checked): The Cerlificateholder is not or is no longer subject to backup withholding. The Cerlificateholder has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest. or dividends. The Cerlificateholder is awaiting a new TIN from the IRS. CERTIFICATION -UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT THE INFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature Holder's Social Security Number or TIN MaturityDate Coupon CUSIP # 12/1/04 9.50% 779228 AJ4 Use This Letter of Transmittal to tender your Certificates maturing December 1, 2004 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent. The Otter will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank By Mail: By Facsimile: Frost National Bank (713) 651 -5015 Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 For Information Calk James Rankin (713) 651-5018 NY Express Mail or Hand Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHER NOMINEE, DO NOT COMPLETE THIS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. IMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must he received by the Tender Agent prior to the Expiration Date of the Invitation. For Certificates held in "Street Name "through banks and brokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions or requests for assistance or additional copies ofthelnvitation or the Letter of Transmittal may be directed to the Information Agent at the telephone number and location listed below. The Dealer Manager for this Invitation is Morgan Stanley & Co., Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800- 365 -BOND (800 -365 -2663) PLEASE READ THE INSTRUCTIONS ON TILE REVERSE SIDE CAREFULLY (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART L Enclosed are my "City of Round Rock, Texas Golf Course Trust Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the terms and conditions set forth in the "Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and in this Letter of Transmittal (collectively, the "Invitation "). I also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (I) purchase of and payment for all Certificates tendered hereby and (ii) the consent to certain amendmenls of the financing documents are subject to the terms and conditions not forth in the Invitation receipt of which is hereby acknowledged and I have carefully reviewed and understand such Invitation. The undersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART 1I. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please mark any corrections to the label attached hereto.) CERTIFICATE(S) ENCLOSED (If more room is needed, attach a signed list.) Certificate. No (s( Principal Amount Tendered PART V. IMPORTANT TAX INFORMATION SIGN HERE Dated: Signature(s) of Owner(s) PART III. [THIS SECTIONNQ[TO BE COMPLETED BY HOLDER- TO BE COMPLETED BY BANK, BROKER, DEALER OR TRUST COMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc. or the commercial bank or trust company having an office, branch or agency in the United States which solicited and obtained this tender is: Name of Firm; (Please Print) Name of Individual, Brokcr or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial bank or trust company will constitute a representation that (i) it has complied with and will comply with the applicable requirements of the Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has usedno solicitation materials other thanthe Invitation and (iii) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV, METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal Is at the election and risk of the tendering holder. His recommended that the Certificates be delivered by Express Mail, Federal Express or other similar courier service, properly insured, in sufficient time to permit receipt by the Tender Agent prior to the Expiration Date. It is also recommended the holder maintain the shipping receipt. For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651 -5018. WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax at a rate of 31% if such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury. Certification may be made to the Tender Agent on the Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL, BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check the boxes that apply to the Certificateholder (one box must be checked): The Certificateholder is not or is no longer subject to backup withholding. The Certificateholder has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest or dividends. The Certificateholder is awaiting a new TIN from the IRS. CERTIFICATION -UNDER THE PENALTIES OF PERJURY, I CERTIFY THATTHEINFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE, Holder's Signature Holder's Social Security Number or TIN MaturityDate Coupon CUSIP # 12/1/05 950% 779228 AK1 Use This Letter of Transmittal to tender your Certificates maturing December 1, 2005 Copies of Letters of Transmittal for other maturities of Certiflcates may be obtained by contacting the Information Agent. The Otter will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank By Maik By Focsimik: Frost National Bank (713) 651 -5015 Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 For Information Cal: James Rankin (713) 651 -5018 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHER NOMINEE, DO NOT COMPLETE THIS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. IMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must be received by the Tender Agent prior to the Expiration Date of the Invitation. For Certificates held in `Street Name "through banks and brokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions or requests for assistance or additional copies of the Invitation or the Letter of Transmittal maybe directed to the Information Agent at the telephone number and location listed below. The Dealer Manager for this Invitation is Morgan Stanley & Co., Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800 - 365 -BOND (800- 365 -2663) INSTRUC ONS ON THE RE 'RS By Ewress Mail or Hw,d Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 FULLY (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART I. Enclosed are my "City of Round Rock, Texas Golf Course Trust Certificates, Series 1989" (the "Certificates ") which I hereby tender pursuant to the terms and conditions set forth in the "Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and in this Letter of Transmittal (collectively, the "Invitation "). 1 also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (i) purchase of and payment for all Certificates tendered hereby and (11) the consent to certain amendments of the financing documents are subject to the terms and conditions set forth in the Invitation receipt of which is hereby acknowledged and I have carefully reviewed and understand such Invitation. The undersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART II. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please mark any corrections to the label attached hereto.) CERTIFICATE(S) ENCLOSED (If more room is needed, attach a signed list.) rtifi a1N o Ls) Principal Amount Tendered SIGN HERE Dated: Signature(s) of Owner(s) PART III. [THIS SECTIONNOTTO BE COMPLETED BY HOLDER- TO BE COMPLETED BY BANK, BROKER, DEALER OR TRUST COMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial bank or trust company having an office, branch or agency in the United States which solicited and obtained this lender 1s: Name of Firm: (Please Print) Name of Individual, Broker or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial hank m trust company will constitute a representation that (i) it has complied with and will comply with the applicable requirements of the Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has used no solicitation materials other than the Invitation and (iii) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal is at the election and risk of the tendering holder. It Is recommended that the Certificates be delivered by Express Mail, Federal Express or other similar courier service, properly insured, in sufficient time to permit receipt by the Tender Agent prior to the Expiration Dale. his also recommended the holder maintain the shipping receipt. For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651-5018. PART V. IMPORTANT TAX INFORMATION WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax ata rate of 31% if such holders have failed to furnish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury. Certification may be made to the Tender Agent on the Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check the boxes that apply to the Certificatcholdcr (one box must be checked): The Certificateholder is not or is no longer subject to backup withholding. The Certificateholder has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest or dividends. The Certificateholder is awaiting a new TIN from the IRS. CERTIFICATION- UNDER THE PENALTIES OF PERJURY, I CERTIFY THATTHE INFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature Holder's Social Security Number or TIN MaturityDate Coupon CUSIP # 12/1/14 10.00% 779228 AU9 Dy Mail: Frost National Bank Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 Use This Letter of Transmittal to tender your Certificates maturing December 1, 2014 Copies of Letters of Transmittal for other maturities of Certificates may be obtained by contacting the Information Agent. The Offer will expire at 5:00 P.M., New York City time, on Wednesday, February 1, 1995, unless earlier terminated or extended. To Accompany ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 Dated Date: December 1, 1989 Tendered Pursuant to the Invitation by CITY OF ROUND ROCK, TEXAS Dated December 23, 1994 Send to: Tender Agent: Frost National Bank By Facsimile: (713) 651-5015 For Information Calk James Rankin (713) 651-5018 Dv amiss Mail or Harr& Frost National Bank Corporate Trust Department Attention James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 IF YOU ARE THE BENEFICIAL OWNER OF CERTIFICATES HELD IN "STREET NAME" THROUGH A BANK, BROKER, DEALER OR OTHER NOMINEE, DO NOT COMPLETE THIS LETTER OF TRANSMITTAL. IN SUCH CASE, PLEASE CALL YOUR BROKER, DEALER, BANK OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR YOU. IMPORTANT: For Certificates held by investors, in certificate form, this Letter of Transmittal (together with Certificates and other required documents) must be received by the Tender Agent prior to the Expiration Date of the Invitation. For Certificates held in "Street Name" through banks and brokers through The Depository Trust Company, tenders and consent transfers may be made through the Automated Tender Offer Program (ATOP). Any questions or requests for assistance or additional copies of the Invitation or the Letter of Transmittal maybe directed to the Information Agent at the telephone number and location listed below. The Dealer Manager for this Invitation is Morgan Stanley & Co., Incorporated. You may also call your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender offer. The Information Agent for the Invitation is: FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800- 365 -BOND (800. 365 -2663) PLEASE READ THE INSTRUCTIONS ON THE REVERSE SIDE CAREFULLY (PLEASE ENCLOSE YOUR CERTIFICATES WITH THIS TENDER FORM) TENDERS WILL NOT BE HONORED WITHOUT A VALIDLY COMPLETED W -9 FORM, ON THE REVERSE SIDE PART I. Enclosed are my "City of Round Rock, Texas Golf Course Trost Certificates, Series 1989" (the `Certificates ") which I hereby tender pursuant to the terms and conditions set forth in the "Invitation To Tender and Solicitation for Consent" dated December 23, 1994 and in this Letter of Transmittal (collectively, the "Invitation l. 1 also hereby consent to the amendments described in the Invitation. The undersigned hereby acknowledges that the (1) purchase of and payment for all Certificates tendered hereby and (ii) the consent to certain amendments or the financing documents are subject to the terms and conditions set forth in the Invitation receipt of which is hereby acknowledged and I have carefully reviewed and understand such Invitation. The undersigned also hereby acknowledges receipt of the communication from the City regarding the purchase price of the Certificates. PART II. DESCRIPTION OF CERTIFICATES TENDERED Name and Address of Registered Holder: (Please mark any corrections to the label attached hereto.) CERTIFICATE(S)ENCLOSED (If more room is needed, attach a signed list.) Ceulficate No (s) Principal Amount olcize.d SIGN HERE Dated: Signature(s) of Owner(s) PART 111. (THIS SECTIONNOTTO BE COMPLETED BY HOLDER- TO BE COMPLETED HY BANK, BROKER, DEALER OR TRUST COMPANY THAT SOLICITED TENDER] The undersigned represents that the member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or the commercial bank or trust company having an office, branch or agency in the United States which solicited and obtained this tender Name of Firm: (Please Print) Name of Individual, Broker or Bank Administrator: Address: (Include Zip Code) The acceptance of compensation by such member, commercial bank or trust company will constitute a representation that (i) it has complied with and will comply with the applicable requirements of the Securities Exchange Act of 1934, as amended, and the applicable rules and regulations thereunder in connections with such solicitation, (ii) in soliciting tenders it has used no solicitation materials other than the invitation and (id) it is entitled to such compensations set forth above and under the terms and conditions of Section 10 of the Invitation. PART IV. METHOD OF DELIVERY The method of delivery of Certificates and this Letter of Transmittal is at the election and risk of the tendering holder. Itisrecommended that the Certificates be delivered by ExpressMall,FederalExpress or other similar courier service, properly insured, in sullicient time to permit receipt by the Tender Agent prior to the Expiration Date. Ills also recommended the holder maintain the shipping receipt. For assistance regarding method of delivery of Certificates, call James Rankin, of the Tender Agent at (713) 651 -5018. PART V. IMPORTANT TAX INFORMATION WE NEED TO KNOW YOUR TAXPAYER IDENTIFICATION NUMBER OR SOCIAL SECURITY NUMBER Under Federal income tax law, amounts paid to holders tendering Certificates for purchase may be subject to a withholding tax at a rate of 31% if such holders have failed to famish a taxpayer identification number or social security number to the Tender Agent under certified penalties of perjury_ Certification may be made to the Tender Agent on the Substitute Form W -9 below. SUBSTITUTE FORM W -9 FROST NATIONAL BANK, AS TENDER AGENT Payer's Request for Taxpayer Identification Number (TIN) or Social Security Number Please check the boxes that apply to the Certificateholder (one box must be checked): The Ccrtificateholder is not or is no longer subject to backup withholding. The Certificateholder has been notified by the IRS that he or she is subject to backup withholding for failure to report all interest or dividends. The Certiticateholder is awaiting a new TIN from the IRS. CERTIFICATION -UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT THE INFORMATION PROVIDED ON THIS FORM IS TRUE, CORRECT AND COMPLETE. Holder's Signature Holder's Social Security Number or TIN Maturity Date Coupon 1 Otdl Principal Outstanding CUSIP # 12/1/96 8.50% $140,000 779228 AA3 12/1/97 8.75% $155,000 779228 AB1 12/1/98 9.00% $165,000 779228 AC9 12/1/99 9.10% $180,000 779228 AD7 12/1/00 9.20% $200,000 779228 AE5 12/1/01 9,30% $215,000 779228 AF2 12/1/02 9,40% $235,000 779228 AGO 12/1/03 9.50% $260,000 779228 AH8 12/1/04 9,50% $280,000 779228 AJ4 12 /1/05 9.50% $310,000 779228 AK1 12/1/14 10.00% 84,600,000 779228 AU9 The CUSIP numbers are included so ely for the convenience of the holders. Neither the City nor the Trustee shall be responsible for the election or the use of the CUSIP numbers, nor is any representation made as to their correctness on the securities. This invitation is Dated: December 23, 1994 CITY OF ROUND ROCK, TEXAS INVITATION TO TENDER AND SOLICITATION FOR CONSENT Relating to: CITY OF ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 DATED DATE: December 1, 1989 THIS INVITATION WILL EXPIRE AT 5:00 p.m., NEW YORK CITY TIME, ON WEDNESDAY, FEBRUARY 1, 1995 UNLESS EARLIER TERMINATED OR EXTENDED The Information Agent for this Invitation is: FIDUCIARY COMMUNICATIONS COMPANY, INC. Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800 - 365 -BOND (800- 365 -2663) Any holder wishing to tender Certificates and /or consent to the amendment pursuant to this Invitation should either follow the procedures more fully described herein or request a broker, dealer, commercial bank, trust company or other nominee to assist in effecting the transaction. See Section 6 herein, "Procedure for Tendering Certificates and Other Related Matters" and Section 11 herein, "Amendment to Lease Agreement and Trust Agreement." Morgan Stanley & Co. Incorporated is serving as Dealer Manager for this Invitation. TABLE OF CONTENTS Section 1. Background A. Original Issuance of the Certificates and Structure of Financing B. History and Financial Condition of Golf Course C. Restructuring and Other Alternatives Page 2 2. General 7 A. Purchase Price; Market for Certificates B. Termination; Settlement 3. Acceptance of Offers 8 4. Irrevocability of Offers by Holders 8 5. Amendments to Invitation 9 6. Procedure for Tendering Certificates and Other Related Matters 9 7. Income Tax Consequences 10 8. Additional Information 10 9. Certain Conditions of Invitation to Tender 11 10. Solicitation and Other Fees 11 11. Amendment to Lease Agreement and Trust Agreement 11 12. Miscellaneous 13 Exhibits Unaudited Financial Report of the Operator Exhibit A Form of Amendments Exhibit B [THIS PAGE INTENTIONALLY LEFT BLANK] Maturity Date Coupon Ibtal Principal Outstanding CUSIP # 12/1/96 850% $140,000 779228 AA3 12/1/97 8.75% $155,000 779228 ABI 12/1/98 9.00% $165,000 779228 AC9 12/1/99 9.10% $180,000 779228 AD7 12/1/00 9.20% $200,000 779228 AE5 12/1 /01 9.30% $215,000 779228 AF2 12/1/02 9.40% $235,000 779228 AGO 12/1/03 9.50% $260,000 779228 A118 12/1/04 950% $280,000 779228 A74 12/1/05 9.50% $310,000 779228 AK1 12/1/14 10.00% $4,600,000 779228 AU9 The CUSIP numbers are included solely for the convenience of the holders. Neither the City nor the Trustee shall be responsible for the selection or the use of the CUSIP numbers, nor is any representation made as to their correctnsss on the securities. This Invitation is Dated: December 23, 1994 CITY OF ROUND ROCK, TEXAS INVITATION TO TENDER AND SOLICITATION FOR CONSENT Relating to: CITY OF ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 DATED DATE: December 1, 1989 THIS INVITATION WILL EXPIRE AT 5:00 p.m., NEW YORK CITY TIME, ON WEDNESDAY, FEBRUARY 1, 1995 UNLESS EARLIER TERMINATED. OR EXTENDED The Information Agent for this Invitation is: FIDUCIARY COMMUNICATIONS COMPANY, INC. Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800 - 365 -BOND (800- 365 -2663) Any holder wishing to tender Certificates and/or consent to the amendment pursuant to this Invitation should either follow the procedures more fully described herein or request a broker, dealer, commercial bank, trust company or other nominee to assist in effecting the transaction. See Section 6 herein, "Procedure for Tendering Certificates and Other Related Matters" and Section 11 herein, "Amendment to Lease Agreement and Trust Agreement." Morgan Stanley & Co. Incorporated is serving as Dealer Manager for this Invitation. TABLE OF CONTENTS Section 1. Background A. Original Issuance of the Certificates and Structure of Financing B. History and Financial Condition of Golf Course C. Restructuring and Other Alternatives Page 2 2. General 7 A. Purchase Price; Market for Certificates B. Termination; Settlement 3. Acceptance of Offers 8 4. Irrevocability of Offers by Holders 8 5. Amendments to Invitation 9 6. Procedure for Tendering Certificates and Other Related Matters 9 7. Income Tax Consequences 10 8. Additional Information 10 9. Certain Conditions of Invitation to Tender 11 10. Solicitation and Other Fees 11 11. Amendment to Lease Agreement and Trust Agreement 11 12. Miscellaneous 13 Exhibits Unaudited Financial Report of the Operator Exhibit A Form of Amendments Exhibit B Invitation to Tender and Solicitation for Consent Relating To: City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 IMPORTANT THIS INVITATION PROVIDES YOU WITH AN OPPORTUNITY TO SELL THE GOLF COURSE TRUST CERTIFICATES (THE "CERTIFICATES ") TO THE CITY OF ROUND ROCK, TEXAS (THE "CITY"). IF YOU CHOOSE NOT TO SELL YOUR CERTIFICATES WE ARE ALSO REQUESTING YOUR CONSENT TO CERTAIN AMENDMENTS TO THE LEASE AGREEMENT AND TRUST AGREEMENT (THE "AMENDMENTS "). Any holder with physical certificates wishing to tender Certificates and consent to the Amendments in response to this Invitation should complete and sign the Letter of Transmittal (green form) and forward it with the Certificates to Frost National Bank, the Tender Agent, at the address set forth on the Letter of Transmittal, not later than 5:00 p.m. New York City time, Wednesday, February 1, 1995. Holders of Certificates registered in the name of a broker, dealer, bank, trust company or other nominee should contact such nominee if they desire to tender their Certificates. The City reserves the right to accept, on terms it deems desirable, or to reject any or all Certificates tendered. CAREFULLY EVALUATE THE INFORMATION CONTAINED HEREIN BEFORE TENDERING YOUR CERTIFICATES OR CONSENTING TO THE AMENDMENTS. THE CITY DOES NOT MAKE ANY RECOMMENDATIONS AS TO WHETHER A HOLDER SHOULD TENDER OR CONSENT TO THE AMENDMENTS OR REFRAIN FROM TENDERING OR CONSENTING WITH RESPECT TO ALL OR ANY CERTIFICATES. NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY SUCH RECOMMENDATION ON BEHALF OF THE CITY AND, IF MADE, ANY SUCH RECOMMENDATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE CITY. The golf course originally financed with the proceeds of the Golf Course Trust Certificates, Series 1989, identified on the cover hereof (collectively referred to as the "Certificates "), has produced net losses since becoming operational on October 19, 1990, see "History and Financial Condition of Golf Course" below. As a result, the City of Round Rock, Texas (the "City") is considering restructuring the financing and by this invitation is offering holders the opportunity to: (i) sell their Certificates and to consent to certain amendments to the Lease Agreement and Trust Agreement executed in connection with the Certificates (the "Amendments ") upon the terms and conditions specified in this Invitation to Tender and Solicitation for Consent and the Letter of Transmittal; or (ii) consent to the Amendments pursuant to a consent form (the "Consent Form ") (the Invitation to Tender and Solicitation for Consent, the Letter of Transmittal and Consent Form being collectively referred to herein as the "Invitation "). This Invitation will expire at 5:00 p.m. New York City time on Wednesday, February 1, 1995, unless earlier terminated or extended by the City in its sole discretion. THE CITY IN ITS SOLE DISCRETION MAY TERMINATE ALL OR ANY PART OF THIS INVITATION PRIOR TO THE STATED EXPIRATION FOR ANY REASON. 1. Background INTRODUCTION A. Original Issuance of the Certificates and Structure of Financing. Introduction. The Certificates were issued by First City, Texas - Austin, N.A., (now Frost National Bank as successor trustee to First City, Texas - Austin, N.A.) (collectively, the "Trustee ") on December 20, 1989 pursuant to the terms of a trust agreement dated as of December 1, 1989 (the "Trust Agreement ") to evidence proportional interests in certain lease payments to be made by the City as rent for a public golf course pursuant to a Lease Agreement between Round Rock Golf, Inc., a State of Texas nonprofit corporation (the "Corporation ") and the City (the "Lease Agreement "). The Certificates are outstanding in the amounts and mature in the years as shown on the cover page hereof. Proceeds of the Certificates were used to (i) finance the acquisition, construction and equipment of a public golf course in the City now known as Forest Creek Golf Course (the "Golf Course "), (ii) fund $1,281,131 in capitalized interest, (iii) fund a $674,000 reserve fund and (iv) pay the costs of issuing the Certificates. The original financing structure is set forth 2 in the Official Statement dated November 22, 1989 which was prepared and distributed in connection with the original issuance of the Certificates. Copies of the original financing documents together with the Official Statement dated November 22, 1989 can be obtained, at no charge, from the Information Agent at 800 - 365 -BOND (800 -365- 2663). Summary of Original Transaction. To briefly summarize the original transaction, the City was deeded certain property pursuant to a Land Use Agreement for Golf Course Tract, dated September 28, 1989 by and between the City and Franklin Capital Corporation (the "Use Agreement "), which provides, among other things, that the property must be used exclusively as a public golf course. To facilitate the financing, acquisition and construction of the golf course, the City leased the real property upon which the improvements were to be located, to the Corporation pursuant to a ground lease and then leased back the property together with any improvements pursuant to the Lease Agreement. Under the terms of the Lease Agreement, City lease payments are payable, subject to annual appropriation, from lawfully available revenues including payments by the Operator, as defined below, of the Golf Course pursuant to the terms of a management agreement dated December 1, 1989 (the "Management Agreement "). The Corporation and the City assigned certain rights under the Lease Agreement, including the right of the Corporation to receive lease payments, to the Trustee pursuant to the Trust Agreement by and among the City, the Corporation and the Trustee. CCA Silband /GolfCorp /Round Rock Inc. (the "Operator "), a single purpose wholly owned subsidiary of CCA Silband /Golf Corp, has operated and managed the Golf Course since it became operational in October, 1990. Pursuant to the terms of the Management Agreement, which expires October 19, 1995 unless an extension is agreed to by the City and the Operator, the Operator is obligated to make payments only from revenues of the Golf Course. However, the Operator has made numerous cash contributions to subsidize operation and maintenance expenses in order to cover the Golf Course revenue shortfalls. See "History and Financial Condition of Golf Course" below. Appropriation Process. Pursuant to the terms of the Lease Agreement and Trust Agreement, the City makes an annual determination prior to the beginning of each fiscal year, which commences October 1, whether to make provision for the payment of Lease Payments during such fiscal year. This annual process is sometimes referred to herein as an "appropriation." The City has no legal obligation to annually appropriate an amount sufficient to pay the Lease Payments due in any year. No Mortgage and Restricted Use. The Certificates are not secured by a mortgage on the Golf Course. In addition, the Use Agreement, which governs the Lease Agreement and Trust Agreement, restricts the use of the property exclusively as a golf course. 3 B. History and Financial Condition of Golf Course. Insufficient Revenues. Certain projections and assumptions regarding forecasted net revenues relied upon at the time the Certificates were issued have not been realized and therefore the Golf Course has not produced sufficient revenues, since the Golf Course became operational on October 19, 1990, to cover: (i) the debt service payments on the Certificates; (ii) the management fee of the Operator pursuant to the Management Agreement; and (iii) the operation and maintenance expenses of the Golf Course. Operator Payments and Management Agreement. The Golf Course, however, has remained operational and lease payments have been made timely due to cash contributions by the Operator and the deferment of payment of part of the management fee owed to the Operator. This arrangement has allowed all payments of debt service on the Certificates to be made, thus far. The Operator, however, has informed the City that it does not intend to fund additional moneys to supplement Golf Course revenues and, since the Operator is not receiving management fees, has also indicated that they would not be inclined to continue to operate the Golf Course under the current financing structure. Under the Management Agreement, the Operator is entitled to (i) $12,000 per month, (ii) 2% of the gross revenues of the Golf Course for the prior month and (iii) an amount equal to the Operator's employees salaries, out -of- pocket expenses and related expenses. According to the Operator, as of October 30, 1994, the earned but unpaid and accrued management fees equal $684,084. The Management Agreement between the City and the Operator terminates October 19, 1995 and discussions are currently underway regarding extending the term of such agreement. No assurances can be given, however, regarding the continued involvement of the Operator with the Golf Course. Financial Statements. Pursuant to the Management Agreement, the Operator is not required to provide audited financial statements for the Golf Course and no audited financial statements currently exist. Attached hereto as Exhibit "A' is the unaudited report of the Operator for the fiscal years 1991, 1992 and 1993 and for the 8 month period ending August 31, 1994 as prepared by the Operator. Copies of the monthly reports which comprise the unaudited condensed statement of operations may be obtained from the Operator at (214) 888 -7766, 3030 LBJ Freeway, Suite 350, Dallas, Texas 75234, Attention: Mike Ussery. Based upon information provided by the Operator, and for purposes of illustration only, below are graphs which compare revenue and net income of the Golf Course for the years 1991, 1992 and 1993 . and the eight months ended August 31, 1994 as well as the 4 existing debt service on the Certificates. However, no assurances can be given regarding future revenues or income of the Golf Course. Debt Service Comparison Existing Debt Service Exceeds Historical Cash Generated* 1000 $ Thousands 900 800 700 600 500 400 300 200 100 AitA alp g;0,09 AP4s E' oeffee4 99.8' Debt Service re s. interest only balms 1996. net of capilelixed interest payments.. • Raceme minus expenses before debt service (1991.93 actual; 19962014 repress. straight-fine Prolecdm based on prior 3-year avera90. Provided for ll9dVatlan purposes orly Round Rock Golf Course Operating Performance* 1500 $ Thousands 1400 1300 1200 1100 1000 900 800 700 600 500 400 300 200 100 0 -100 -200 -300 400 1991 1992 1994 data vrD through 9/31/99, 1993 Reserve Fund. A portion of the proceeds of the Certificates have been used to establish a reserve for the payment of debt service on the Certificates. As of September 30, 1994, the Reserve Fund contained $732,856.89 which is comprised of the reserve requirement of $674,000 plus interest earnings. The application by the Trustee of the money held within the Reserve Fund is governed by the Trust Agreement which grants the Trustee certain rights and duties in administering the trust. In particular, Section 9.03 of the Trust Agreement provides: [u]pon an Event of Default, but only upon an Event of Default, the Trustee shall have a first lien with right of payment prior to payment on account of principal, premium, if any, and interest due with respect to any Certificate upon the amounts held hereunder for the foregoing fees, charges and expenses incurred by it. 1994 • naudee Debt service expense. No City Funds Involved. The financing structure utilized in connection with the sale of the Certificates evidences the City's financing requirement that the Golf Course be a self - supporting project that is not dependent upon any tax or other revenues of the City. To date, Lease Payments have been made from Golf Course revenues, Operator contributions, certain investment income from the Reserve Fund and capitalized interest. THE CITY HAS 5 NEVER USED MONEYS FROM ITS GENERAL FUND TO SUPPORT LEASE PAYMENTS AND DOES NOT CURRENTLY ANTICIPATE APPLYING ANY OF THE CITY'S GENERAL REVENUES TO MAKE ANY LEASE PAYMENTS ON THE GOLF COURSE. Based solely upon the availability of a combination of Golf Course revenues together with Operator payments and investment income from the reserve fund, the City has made provision to pay lease payments due in January 1, 1995 through September 30, 1995. However no assurances can be made that the City will make provision for the payment of lease payments for any fiscal year subsequent to September 30 1995. The City is under no legal obligation to pay lease payments for subsequent fiscal years. THE CERTIFICATES DO NOT CONSTITUTE: • DEBT OF THE CITY; • THE STATE OF TEXAS; • ANY POLITICAL SUBDIVISION OF THE STATE WITHIN THE MEANING OF THE CONSTITUTION OF THE STATE OF TEXAS; OR • A PLEDGE OF THE FAITH AND CREDIT OF THE CITY. C. Restructuring and Other Alternatives. This Invitation is part of a refinancing/restructuring plan the City is considering in order to cure the cashflow deficits of the Golf Course. Historical revenues and expenses of the Golf Course indicate that if less than 85% of the Certificates are tendered, the future economic viability of the Golf Course will be jeopardized. THE CITY BELIEVES THAT THE CONTINUED OPERATION AND SUCCESS OF THE GOLF COURSE IS DEPENDENT ON THE RELATIVE SUCCESS OF THIS INVITATION. If the tender is successful, the City anticipates (i) issuing new debt, (ii) using certain lawfully available funds on hand or (iii) a combination of (i) and (ii), to effectuate the payment of the purchase price for all Certificates tendered and, if necessary, to provide for the payment of any Certificates not tendered (i.e., defeasance until maturity or the first available redemption date of December 1, 1998). See Section 11 of this Invitation, "Amendment to Lease Agreement and Trust Agreement." If the tender offer is not successful, it is uncertain what course of action the City may take. The City may not take any action or may decide, beginning October 1, 1995, to terminate the Lease Agreement by not paying lease payments (Le., nonappropriation) in future fiscal years. Both such options may result in insufficient Golf Course revenues to pay the principal of and interest on the Certificates. Additionally, if the City elects to nonappropriate and terminates the Lease Agreement and annual Golf Course revenues are insufficient to pay principal of and interest on the Certificates, the Golf Course cannot be put to use as anything other than a Golf Course by the Trustee. The Certificates are not 6 secured by a mortgage on the Golf Course. Failure to comply with certain provisions of the Use Agreement may result in the City's loss of ownership of the Golf Course and in such event there would be no source of revenues to repay the Certificates. Additionally, the City does not currently have the personnel or experience to manage the Golf Course and if (i) the Operator does not continue operating the Golf Course and (ii) the City does not appropriate lease payments for future fiscal years, the ability of the Golf Course to generate sufficient revenues to pay the principal of and interest on the Certificates may also be jeopardized. 2. General. A. Purchase Price; Market for Certificates. The purchase price for the Certificates will be established on or about the week of January 9, 1995 and will be made available by mail (via first -class mail) to the registered holders, through the Munifacts Wire System, Bloomberg News Service, Dow Jones News System and the Information Agent. The purchase price will also be posted in Redemption Digest and Securities Industry Daily. Certificateholders may also contact Richard Jacowitz with the Information Agent on or about January 9, 1995 at 800 - 365 -BOND (800- 365 -2663) to receive purchase price information. First Southwest Company, will assist the City in determining a purchase price for the Certificates. The Certificates are not listed on any securities exchange nor actively traded. It is recommended that holders consult their brokers or financial advisors for information concerning the liquidity of, and the prices which may be obtainable for, their Certificates. Any purchases of Certificates by the City pursuant to this Invitation will reduce the amount of Certificates available to trade publicly which could materially affect the liquidity and market value of the Certificates remaining outstanding. B. Termination; Settlement. THE CITY RESERVES THE RIGHT, IN ITS SOLE DISCRETION, TO TERMINATE THIS INVITATION, IN WHOLE OR IN PART, PRIOR TO THE EXPIRATION DATE. If the City terminates the Invitation in whole or in part prior to Wednesday, February 1, 1995, the City will give notice of such termination by disseminating such information through the means described in Section 2A above. In such event, the City will not be required to accept for payment or pay for any affected registered Certificates which have been tendered previously and all such Certificates shall be returned to the holders thereof. In addition, the City reserves the right to reject any and all Letters of Transmittal for Certificates tendered. The City further reserves the right to waive any irregularities in any and all of the Letters of Transmittal or Consent Forms, and to accept or reject any and all Letters of Transmittal or Consent Forms received after the above stated deadlines for receipt of such documents. The City expects that the date of purchase of Certificates tendered (the "Settlement Date ") will be on or about April 19, 1995. The City's obligation to purchase and pay for Certificates validly tendered is subject to the sole discretion of the City. The City is not obligated to accept any offers made. Payment by the City on the Settlement Date will be made in immediately available funds by deposit of the purchase price of the Certificates accepted for payment plus, in each case, interest accrued to the Settlement Date, with Frost National Bank in Houston, Texas (the "Tender Agent "). Accrued interest will only include interest earned on the Certificates from the date interest was last paid through the day immediately prior to the Settlement Date. The Tender Agent will act as agent for the tendering holders of the Certificates for the purpose of receiving payment from the City and transmitting payment to the tendering holders of the Certificates. After payment by the City to the Tender Agent, the tendering holders of the Certificates will not be entitled to receive interest on such Certificates. Payment by the Tender Agent will be made by check payable to the tendering holders of the Certificates promptly after the Settlement Date at the addresses specified by them in their Letters of Transmittal. 3. Acceptance of Offers. The City is not obligated to purchase any minimum or maximum amount of Certificates. Acceptance by the City of offers to tender and sell Certificates pursuant to this Invitation shall constitute an irrevocable agreement between the offering holder and the City subject to all terms and conditions expressed in this Invitation. Such acceptance shall be made on or about February 10, 1995 by disseminating such information through the Bloomberg News Service, Securities Industry Daily, Munifacts Wire System, Dow Jones News System and notification to the Tender Agent, which shall be instructed to notify the registered holders of such acceptance. All questions as to the validity, form, eligibility and acceptance of any offers will be determined by the City, in its sole and absolute discretion, which determination shall be final and binding. The City reserves the absolute right to reject any and all offers which it determines do not comply with the terms of this Invitation. The City further reserves the right to waive any irregularities in any and all of the offers. None of the City, the Tender Agent or Morgan Stanley & Co. Incorporated, as Dealer Manager (the "Dealer Manager ") shall be obligated to give notice of any defects or irregularities in offers, nor shall either of them incur any liability for failure to give such notice. 4. Irrevocability of Offers by Holders. All offers by holders to sell their Certificates, once transmitted to the Tender Agent, are irrevocable. Any Certificate tendered by a holder pursuant to this Invitation and not 8 purchased by May 2, 1995 shall be returned to the tendering holder by the Tender Agent and shall no longer be subject to the terms of this Invitation. No assurance can be given by the City that the purchase of Certificates contemplated hereby will be consummated. None of the Tender Agent, the City or the Dealer Manager shall have any duty or responsibility to any holder of any outstanding Certificate or any other party in connection with this Invitation other than as expressly set forth herein. 5. Amendments to Invitation. The City reserves the right in its sole discretion at any time prior to acceptance of any offers to tender to terminate, amend and /or withdraw the Invitation without liability to any person. 6. Procedure for Tendering Certificates and Other Related Matters. A. Procedure for Certificates held in Physical Certificate Form. For a holder to effectively tender Certificates pursuant to this Invitation, the Certificates, a properly completed and duly executed Letter of Transmittal (or a facsimile thereof) for the Certificates being tendered, and any other documents required by such Letter of Transmittal must be received by the Tender Agent prior to the Expiration Date. B. Procedure for Certificates held by Brokers, Dealers or Banks in "Street Name." BENEFICIAL OWNERS OF CERTIFICATES REGISTERED IN THE NAME OF A BROKER, DEALER, BANK, TRUST COMPANY OR OTHER NOMINEE OR HELD THROUGH A BOOK -ENTRY TRANSFER FACILITY, SHOULD NOT USE THE LE T'I'ERS OF TRANSMITTAL. SUCH BENEFICIAL OWNERS SHOULD CONTACT THEIR BROKER, DEALER, BANK OR OTHER NOMINEE TO ARRANGE THE TENDER OF THEIR CERTIFICATES. The Tender Agent will establish an account with respect to the Certificates at The Depository Trust Company, for purposes of this Invitation, within two business days after the date of this Invitation. Any financial institution that is a participant in The Depository Trust Company may make book -entry delivery of Certificates by causing The Depository Trust Company to transfer such Certificates into the Tender Agent's account, in accordance with The Depository Trust Company's Automated Tender Offer Program (ATOP). C. General Provisions. Each tender of Certificates must be for the entire Certificate or an integral multiple of $5,000 thereof. 9 A copy of the Letter of Transmittal accompanies this Invitation. Additional copies of the Letter of Transmittal may be obtained by calling the Information Agent at the telephone number given on the cover page. The method of delivery of Certificates and other documents is at the election and risk of the tendering holder. It is recommended that Certificates be delivered by Express Mail, Federal Express or other similar courier service, properly insured, in sufficient time to permit receipt by the Tender Agent prior to the Expiration Date. It is also recommended the holder maintain the shipping receipt. For assistance regarding method of delivery of the Certificates, call James Rankin with the Tender Agent at (713) 651 -5018. 7. Income Tax Consequences. The Federal income tax consequences of a sale pursuant to this Invitation may vary depending upon, among other things, the particular circumstances of the holder. A sale by a holder pursuant to this Invitation, however, will be a transaction in which gain or loss may be recognized for Federal income tax purposes. In the case of a taxpayer who holds a Certificate as a capital asset (other than a bank and certain other financial institutions), any such gain or loss will be characterized as capital gain or loss. Whether capital gain is long- term or short-term will depend on whether such Certificate was held by the taxpayer for more than one year. If the purchase price (exclusive of accrued interest) paid to a holder for a Certificate exceeds or is less than the holder's adjusted basis for such certificate, such holder will recognize capital gain or loss to the extent of the difference. For this purpose, if the holder purchased the Certificate at a premium or discount, then the holder may be required to adjust such basis in the Certificate by an amount representing amortization of such premium or discount as required by the Code. Federal income tax law requires the Tender Agent to notify the Internal Revenue Service (the "IRS ") of certain sales of Certificates. As such, the amount of any sale made pursuant to this Invitation will be reported on a Form 1099 -B furnished to the holder and the Internal Revenue Service. Amounts paid to a holder tendering a Certificate for purchase may be subject to a backup withholding tax at a rate of 31% by reason of the events specified by Section 3406 of the Code and regulations thereunder. These events include failure of a holder to supply the Tender Agent with the holder's correct taxpayer identification number or social security number certified under penalties of perjury. Certification may be made on the enclosed Letter of Transmittal. This Federal income tax discussion only is included for general informational purposes and does not purport to deal with all aspects of Federal income taxation that may be relevant to any particular holder. The City and the Tender Agent do not undertake to render any advice on the tax consequences to any particular holder, and holders are advised to consult their tax advisers as to the particular Federal, state or local tax consequences of sales made by them pursuant to this Invitation. 1 0 8. Additional Information. You may obtain additional information relating to the above by contacting Fiduciary Communications Company, Inc. toll -free at 800- 365 -BOND (800- 365- 2663). You may also choose to contact your broker, dealer or other financial advisor for more information. 9. Certain Conditions of Invitation to Tender. The City is not obligated to accept any offers made pursuant to this Invitation. The City's obligation to purchase and pay for Certificates tendered is subject to the sole discretion of the City, including certain conditions such as ability to issue new debt to effectuate the tender. 10. Solicitation and Other Fees. The City will pay to any broker, dealer, bank, trust company or other nominee, including the Dealer Manager, the name of which appears in the appropriate space in the Letter of Transmittal, a solicitation fee of $15 per $5,000 principal amount of any Certificates (i) covered by a Letter of Transmittal and purchased pursuant to this Invitation or (ii) covered by a Consent Form. No broker, dealer, commercial bank, trust company or fiduciary shall be deemed to be the agent of the City, the Tender Agent, the Information Agent or the Dealer Manager for purposes of this Invitation. The City has retained Morgan Stanley & Co. Incorporated to act as Dealer Manager in connection with this Invitation. The City has agreed to pay the Dealer Manager a fee of $15 per $5,000 based upon the principal amount of Certificates purchased pursuant to this Invitation and will reimburse the Dealer Manager for certain out -of- pocket expenses. Morgan Stanley & Co. Incorporated will also act as lead underwriter of the issuance of any new debt issued to effectuate the tender. The Tender Agent will receive reasonable and customary compensation for its services and will be reimbursed for certain out -of- pocket expenses. 11. Amendment to Lease Agreement and Trust Agreement. (a) Tender Deemed Consent to Amendments. As a part of this Invitation, the City is soliciting the consent from each of the registered holders to the Amendments. The holders of sixty percent (60 %) of the aggregate principal amount of outstanding Certificates must consent to the Amendments before the Amendments can become effective. HOLDERS TENDERING CERTIFICATES PURSUANT TO THE PROVISIONS OF THIS TENDER WILL BE DEEMED TO HAVE CONSENTED TO THE AMENDMENTS TO THE LEASE AGREEMENT AND TRUST AGREEMENT AS SET 11 OUT IN THE PROPOSED RESOLUTION SO LONG AS THE CITY BUYS SUCH CERTIFICATES. (b) Background and Purpose of Amendments. If the City proceeds with any refinancing/restructuring of the Certificates, the City may determine that it is necessary to make provision for the payment of, or legally "defease" until the first available redemption date of December 1, 1998, any Certificates not tendered for purchase, particularly if the reserve fund established in connection with the Certificates is used as a cash contribution for the refinancing/restructuring. Pursuant to Texas law and the Amendments, a defeasance of outstanding Certificates can be effectuated only upon the deposit in escrow of cash and /or United States Treasury obligations which mature in an amount sufficient to pay the principal of and interest on the Certificates at maturity or early redemption. HOLDERS ARE ADVISED TO CAREFULLY REVIEW THIS INVITATION AND THE PROPOSED RESOLUTION WHICH CONTAINS THE AMENDMENTS TO THE LEASE AGREEMENT AND TRUST AGREEMENT (ATTACHED AS "EXHIBIT E). (c) Procedure for Consent. Any holder who does not wish to tender Certificates but who concurs with the Amendments should execute, date and return the enclosed pink Consent Form in accordance with the instructions set forth therein and shall mail or deliver such Consent Form and any other required documentation to City of Round Rock, Texas, c/o Frost National Bank, as Tender Agent, by mail, P.O. Box 3856, Houston, Texas 77253 or by express courier or hand, 1301 Fannin, Suite 2215 Houston, Texas 77002 or by facsimile transmission (713) 651 -5015 so that it is received on or before the Expiration Date. Only a registered holder (or its legally authorized representative) may execute the Consent Form. Any beneficial owner of a Certificate who is not the registered holder of such Certificate (e.g. a beneficial owner with Certificates registered in the name of a securities depository such as The Depository Trust Company) must arrange with the registered holder to execute and deliver the Consent Form on its behalf. THE CONSENT FORM SHOULD BE SIGNED AND RETURNED IN THE ENCLOSED PREADDRESSED ENVELOPE. NO CONSENT SHOULD BE SENT TO ANY PERSON OTHER THAN THE TENDER AGENT. Delivery will be effective only upon actual receipt by the Tender Agent. Consent Forms may also be delivered by hand to the Tender Agent at its address set forth above. Holders may also request their respective brokers, dealers, commercial banks, trust companies or nominees to effect delivery on behalf of such holder. The holder may confirm that the Consent Form has been received by the Tender Agent by calling James Rankin at (713) 651 -5018, between the hours of 9:00 a.m. and 4:30 p.m., Central Standard Time. 12 If a Consent Form relates to less than all of the Certificates registered in the name of the holder providing the Consent Form, the holder must indicate by certificate number the principal amount of Certificates to which the Consent Form relates. Otherwise, the Consent Form will be deemed to be related to all of the Certificates registered in the name of the holder. Proof of execution of a Consent Form shall be determined in accordance with such reasonable rules as the City may prescribe. The ownership of Certificates shall be proved by the registration books maintained by the Trustee. The City may require as much additional proof of execution or ownership as it deems necessary. All questions as to the validity, form, eligibility (including time of receipt) and acceptance of consents will be resolved by the City. The City reserves the absolute right to reject any or all Consent Forms that are not in proper form or the acceptance of which could, in the opinion of the City's counsel, be unlawful. The City also reserves the right to waive any irregularities or conditions of delivery as to particular Consent Forms. The City's interpretation of the terms and conditions of this solicitation shall be binding. Unless waived, any irregularity in connection with delivery of a Consent Form must be resolved within such reasonable time as the City determines. The City shall be under no duty to give notification of any irregularity or waiver. Delivery of a Consent with one or more irregularities will not be deemed to have been made until the irregularities have been resolved or waived. ONCE GIVEN, CONSENT MAY NOT BE REVOKED PRIOR TO THE DATE CERTIFICATES ARE PURCHASED IRRESPECTIVE OF THE SALE OR TRANSFER OF THE CERTIFICATES. 12. Miscellaneous. This Invitation is not being made to, nor will the City accept tenders from, holders of Certificates in any jurisdiction in which the Invitation or the acceptance thereof would not be in compliance with the laws of such jurisdiction. In those jurisdictions whose laws require the Invitation to be made through a licensed broker or dealer, this Invitation is being made on behalf of the City by the Dealer Manager. No person has been authorized to make any recommendation on behalf of the City as to whether a holder should tender Certificates or consent to the amendments pursuant to the Invitation. No person has been authorized to give any information or to make any representation in connection with the Invitation other than as contained herein or in the Letters of Transmittal and the Consent Form. If given or made, such recommendation and such information and representation must not be relied upon as having been authorized by the City. The City makes no recommendation to any holder as to whether to tender or to refrain from tendering such holder's Certificates or to consent to certain amendments pursuant to the Invitation. Each holder must make the decision to consent or to tender Certificates and, if the decision is made how many Certificates to tender. Holders are urged to review carefully the information contained herein in reaching a decision. 13 The City reserves the right to effect transactions in the Certificates other than pursuant to this Invitation during the tender period. The City reserves the right at any time and from time to time, after the expiration or termination of the tender period, to purchase Certificates at such prices and upon such terms and conditions as it shall deem appropriate. 14 CITY OF ROUND ROCK, TEXAS Duly executed photocopies or facsimiles of any notice given in connection with this Invitation will be accepted. All such communications to be sent or delivered to the Tender Agent should be delivered at the appropriate address or facsimile number set forth below. By Hand or Express Courier: Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 The Tender Agent for this Invitation: FROST NATIONAL BANK Facsimile Number: (713) 651 -5015 For Assistance, Please Contact: James Rankin (713) 651 -5018 Holders should contact their broker, dealer, financial advisor, commercial bank or trust company for assistance concerning this Invitation. For copies of this Invitation or for any questions regarding this Invitation, telephone Fiduciary Communications Company at the telephone number listed below. The Information Agent for this Invitation is: The Dealer Manager for this Invitation is: Morgan Stanley & Co. Incorporated 1221 Avenue of the Americas New York, New York 10020 By Mail: Frost National Bank Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 FIDUCIARY COMMUNICATIONS COMPANY, INC. Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800 - 365 -BOND (800- 365 -2663) EXHIBIT A Unaudited Balance Sheet, Unaudited Condensed Statement of Operations and Unaudited Other Selected Financial Information for Fiscal Years Ended December 31, 1991 through December 31, 1993 and eight months ended August 31, 1994 1 i November 17, 1994 Mr. David Kautz Director of Finance City of Round Rock 221 E. Main Street Round Rock, TX 78664 Dear Mr. Kautz: The monthly financial statements for Forest Creek Golf Club have been prepared by GolfCorp in accordance with Generally Accepted Accounting Principals (GAAP). Sincerely, ack Lupton Chief Financial Officer GolfCorp GOLFCORP A -1 3030LBJ FREEWAY • SUITE 350 • LB 49 • DALLAS, TEXAS 75234 214/898.7766• FAX 214/9984773 Total Assets GOLFCORP Round Rock Golf, Inc Forest Creek Golf Club Unaudited Balance sheet as of August 31, 1994 Assets Cash 92 Inventory 32,109 Accounts Receivable 37,945 Prepaid Expenses 126,051 Total Current Assets 288,532 Other Assets 19,844 Property, Plant & Equipment 289,808 less: Accumulated Depreciation (103,310) Net Property, Plant & Equipment 186,498 494,874 Liabilities Accounts Payable - Trade 78,044 Accounts Payable - Affiliate 1,288,187 Short Term Notes Payable 61,911 Current Accruals 76,459 Other Current Liabilities 223 Total Liabilities 1,504,824 Owner's Equity Retained Eamings (Deficit) (903,246) Net Income (Loss) Current Year (106,704) Total Owner's Equity (1,009,950) Total Liabilities and Owner's Equity 494,874 A -2 3030 LBI FREEWAY • SUITE 350 • LB 49 • DALLAS, TEXAS 75234 2141888 -7766• FAX 2141888 -7773 Net Income (Loss) GOLFCORP Round Rock Golf, Inc Forest Creek Golf Club Unaudited Condensed Statement of Operations Fiscal Year Ended December 31 8 months 1991 1992 1993 as of 8/31/94 Operating Revenue Golf Fees 475,407 622,121 580,422 491,274 Cart Fees 230,712 319,838 322,092 296,266 Food & Beverage Sales 119,769 162,934 143,648 131,202 Merchandise & Other 120,607 155,695 143,671 114,396 Total Operating Revenue 946,495 1,260,588 1,189,833 1,033,138 Operating Expenses Salaries /Commissions /Benefits 257,692 273,133 295,269 207,913 Management Fees 223,986 127,424 167,661 116,723 Cost of Goods Sold 113,392 168,675 146,941 119,430 Lease Expense - Golf Course (1) 293,969 376,908 528,719 438,618 Rental & Equipment Lease Expense 66,710 69,451 80,807 39,273 Grounds Maintenance 68,311 74,024 (38,415) 39,481 Depreciation & Amortization 37,318 38,504 41,051 8,744 Other Operating Expenses 187,584 308,242 314,728 169,660 Total Operating Expenses 1,248,962 1,436,361 1,536,761 1,139,842 (1) Lease Expense represents interest cost on the Trust Certificates. (302,467) (175,773) (346,928) (106,704) A -3 3030 ERJ FREEWAY • SUITE 350 • LB 49 • DALLAS, TEXAS 75234 214/888.7766• FAX 214/888 -7773 G GOLFCORP Round Rock Golf, Inc Forest Creek Golf Club Unaudited Other Selected Financial Information Fiscal Year Ended December 31 8 months 1991 1992 1993 as of 813119 Total Rounds 33,122 44,295 42,388 33,397 Average Green Fee per Round 14.35 14.04 13.69 14.71 Average Cart Fee per Round 6.97 7.22 7.60 8.87 A -4 3030 LRJ FREEWAY • SUITE 350 • L549 • DALLAS. TEXAS 75234 214/885 -7766 • FAX 214/888-7773 EXHIBIT B FORM OF RESOLUTION RESOLUTION APPROVING FIRST SUPPLEMENTAL TRUST AGREEMENT AND FIRST SUPPLEMENTAL LEASE AGREEMENT WHEREAS, the City of Round Rock, Texas (the "City") has previously executed a "Golf Course Construction and Lease /Purchase Agreement" dated as of December 1, 1989 (the "Lease ") between the City, as lessee and Round Rock Golf, Inc., as lessor in connection with the acquisition, construction and financing of a public golf course; and WHEREAS, in furtherance of the acquisition, construction and financing of the golf course, a Trust Agreement dated as of December 1, 1989 by and among the City of Round Rock, Texas, First City, Texas - Austin N.A., as Trustee and Round Rock Golf, Inc. (the "Trust Agreement") was executed in connection with the issuance of $6,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates "); and WHEREAS, the City deems it advisable and necessary to amend the Lease and Trust Agreement to clarify the City's ability to provide for the prepayment of lease payments under the Lease and therefore releasing and defeasing its obligations under the Lease, Trust Agreement and Certificates; and WHEREAS, pursuant to Section 15.4 of the Lease, the Lease can be modified by written amendment of the lessee and the lessor as provided in the Trust Agreement; and WHEREAS, pursuant to Article X of the Trust Agreement, the Trust Agreement can be modified or amended at any time by a supplemental agreement executed by the City and the lessor which amendment shall become effective when the written consents of the owners of 60% in aggregate principal amount of the Certificates outstanding shall be filed with the Trustee; and WHEREAS, the lessor and lessee will be soliciting the consent to the First Supplemental Trust Agreement and First Supplemental Lease Agreement by 60% of the owners of the Certificates as required by Article X of the Trust Agreement; and WHEREAS, the Trust Agreement and Lease shall be deemed modified and amended by the First Supplemental Trust Agreement dated as of December 1, 1994 and the First Supplemental Lease Agreement dated as of December 1, 1994, respectively, in substantially the form attached hereto as Exhibit "A"; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ROUND ROCK, TEXAS: B -1 Section 1. Recitals and Approval of Supplemental Agreements. The recitals set forth in the preamble hereof are incorporated by reference herein and shall have the same force and effect as if set forth in this Section. The City hereby approves the First Supplemental Trust Agreement and First Supplemental Lease Agreement in substantially the form attached hereto as Exhibit "A" and the Mayor or City Manager are hereby authorized to execute the agreements and the City Secretary is hereby authorized to attest such agreements. Section 2. Further Procedures. The Mayor or City Manager, City Secretary, the Director of Finance and all other officers, employees and agents of the City, including the City's Financial Advisor and attorneys, and each of them, shall be and they are hereby expressly authorized, empowered and directed from time to time and at any time to do and perform all such acts and things to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the City all instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Resolution, the First Supplemental Trust Agreement and First Supplemental Lease Agreement, the amendment of such agreements and other matters in connection therewith. Section 3. Full Force and Effect. Except as expressly amended and modified as set forth in Exhibit "A" attached hereto, all terms and provisions of the Lease and the Trust Agreement, respectively shall remain in full force and effect and the City hereby ratifies, confirms and adopts the Lease and Trust Agreement as amended and modified by the First Supplemental Trust Agreement and First Supplemental Lease Agreement. B -2 FIRST SUPPLEMENTAL TRUST AGREEMENT This First Supplemental Trust Agreement ("First Supplement ") dated as of December 1, 1994 is entered into by and among the City of Round Rock, Texas (the "City"), Frost National Bank, as Trustee (as successor trustee to First City, Texas - Austin, N.A.) (the "Trustee ") and Round Rock Golf, Inc. (the "Corporation "). WITNESSETH: WHEREAS, the Trustee, the Corporation and the City have previously executed a "Trust Agreement" dated as of December 1, 1989 (the "Trust Agreement ") in connection with the issuance by the Trustee of $6,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates") evidencing proportional interests in certain lease payments made by the City under the Lease Agreement dated as of December 1, 1989 between the City and the Corporation; and WHEREAS, the City and the Corporation deem it advisable and necessary to amend the Trust Agreement pursuant to the provisions of Article X thereof to clarify the ability to provide for the payment or prepayment of the Certificates and Lease Payments and therefore releasing and defeasing the obligations of the City and the Corporation under the Trust Agreement and Lease. NOW, THEREFORE, the parties hereto agree as follows: 1. Section 14.01 of the Trust Agreement is deleted in its entirety and is hereby amended to read in its entirety as follows: Section 14.01. DEFEASANCE OF CERTIFICATES AND LEASE PAYMENTS. (a) Any Certificate and the interest thereon and Lease Payments shall be deemed to be paid, retired, and no longer outstanding (a "Defeased Obligation ") within the meaning of this Trust Agreement and the Lease Agreement, respectively, except to the extent provided in subsection (d) of this Section 14.01, when payment of the principal of such Certificate, plus interest thereon to the due date (whether such due date be by reason of maturity, upon redemption, or otherwise) and premium, if any, and the Lease Payment either (i) shall have been made or caused to be made in accordance with the terms thereof (including the giving of any required notice of redemption), or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Trustee for such payment (1) lawful money of the United States of America sufficient to make such payment, (2) Government Obligations which mature as to principal and interest in such amounts and at such times as will ensure the availability, without reinvestment, of sufficient money to provide for such payment and when proper arrangements have been made with the Trustee for the payment of its services until all Defeased Obligations shall have become due and payable or (3) a combination of (1) and (2). At such time as a Certificate shall be deemed to be a Defeased Obligation hereunder, as aforesaid, such Certificate and the interest thereon and the Lease Payments shall no longer be secured by, payable from, or B -3 f entitled to the benefits of, the Trust Agreement and Lease Agreement, as provided herein, and such principal and interest shall be payable solely from such money or Government Obligations. (b) Any moneys so deposited with the Trustee may at the written direction of the City also be invested in Government Obligations, maturing in the amounts and times as hereinbefore set forth, and all income from such Government Obligations received by the Trustee which is not required for the payment of the Certificates and interest thereon with respect to which such money has been so deposited, shall be turned over to the City, or deposited as directed in writing by the City. (c) The term "Government Obligations" as used in this Section, shall mean direct non - callable obligations of the United States of America, including, obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, which may be United States Treasury obligations such as its State and Local Government Series, which may be in book -entry form. (d) Until all Defeased Obligations shall have become due and payable, the Trustee shall perform the services of Trustee and paying agent/registrar for such Defeased Obligations the same as if they had not been defeased, and the City shall make proper arrangements to provide and pay for such services as required by this Trust Agreement. In the event of a deposit set forth in (a)(ii) of this Section, the Certificates shall continue to represent direct and proportionate interests of the owners thereof in Lease Payments under the Lease. 2. Except as expressly amended and modified hereby, all terms and provisions of the Lease shall remain in full force and effect, and the Lessor and Lessee hereby ratify, confirm and adopt the Lease as amended and modified hereby. B -4 IN WITNESS WHEREOF, the parties hereto have caused this First Supplement to be duly executed by their respective authorized officers as of the day and year first above written and effective upon the receipt of the necessary consents. ATTEST: By: City Secretary ATTEST: By: Title: ATTEST: By: Title: CITY OF ROUND ROCK, TEXAS By: Title: ROUND ROCK GOLF, INC. By: Title: FROST NATIONAL BANK, AS TRUSTEE By: Title B-5 FIRST SUPPLEMENTAL GOLF COURSE CONSTRUCTION AND LEASE/PURCHASE AGREEMENT This First Supplemental Golf Course Construction and Lease/Purchase Agreement ( "First Supplement") dated as of December 1, 1994 is entered into by and between the City of Round Rock, Texas, as lessee (the "Lessee ") and Round Rock Golf, Inc., as lessor (the "Lessor"). WITNESSETH: WHEREAS, the Lessor and Lessee have previously executed a "Golf Course Construction and Lease/Purchase Agreement" dated as of December 1, 1989 (the "Lease") in connection with the acquisition, construction and financing of a public golf course; and WHEREAS, the Lessor and Lessee deem it advisable and necessary to amend the Lease, pursuant to the provisions of Section 15.4 to clarify the Lessee's ability to provide for the prepayment and defeasance of lease payments under the Lease and therefore releasing and defeasing its obligations under the Lease. NOW, THEREFORE, the parties hereto agree as follows: 1. Section 10.3 of the Lease is deleted in its entirety and is hereby amended to read in its entirety as follows: Section 10.03. Prepayment of Lease Payments and /or purchase of Project and Release of Lessor's Interest. Notwithstanding any other provision of this Lease Agreement to the contrary, the Lessee shall have the option to purchase the Project and /or make provision to prepay any of the remaining Lease Payments on any date by irrevocably depositing with or making available to the Trustee for such payment (1) lawful money of the United States of America sufficient to make such payment, (2) Government Obligations which mature as to principal and interest in such amounts and in such times to ensure the availability, without reinvestment, of sufficient money to provide for such Lease Payments as further set forth in Section 14.01 of the Trust Agreement as amended by the First Supplemental Trust Agreement dated as of December 1, 1994. Upon exercise by the Lessee of its option to purchase the Property by paying or making provision for the payment of all remaining Lease Payments and any other amounts then due or past due, Lessee shall have no further obligations under this Lease Agreement and the Ground Lease and Lessor and Trustee shall take all actions necessary to authorize, execute and deliver to Lessee any and all documents necessary to vest in Lessee, all of the Lessor's and Trustee's right, title and interest in and to the Project, free and clear of all liens, leasehold interests and encumbrances, including, if necessary, a release of any and all liens or interest created under the provisions of this Lease Agreement or the Ground Lease. 2. Except as expressly amended and modified hereby, all terms and provision of B -6 the Lease shall remain in full force and effect, and the Lessor and Lessee hereby ratify, confirm and adopt the Lease as amended and modified hereby. B -7 [THIS PAGE INTENTIONALLY LEFT BLANK] Morgan Stanley & Co. Incorporated 1221 Avenue of the Americas New York, New York 10020 Ladies and Gentlemen: City of Round Rock, Texas 221 East Main Street Round Rock, Texas 78664 DEALER MANAGER AGREEMENT December 23, 1994 1. The Offer. The City of Round Rock, Texas (the "Purchaser "), intends to make a tender offer (hereinafter, together with any extensions or amendments thereof, called the "Offer ") to purchase for cash any and all of the outstanding $6,740,000 aggregate principal amount of City of Round Rock, Texas, Golf Course Trust Certificates, Series 1989 (the "Certificates "), issued pursuant to that certain Trust Agreement, dated as of December 1, 1989 (the "Trust Agreement "), by and among the Purchaser, First City, Texas - Austin, N.A., as trustee (now Frost National Bank, Austin, Texas), and Round Rock Golf, Inc. 2. Appointment as Dealer Manager. The Purchaser hereby appoints you as dealer manager ( "Dealer Manager ") in connection with the Offer. You agree that you will act, in accordance with the terms hereof, as Dealer Manager for the Offer. 3. No Liability for Acts of Dealer Manager. Dealers. Banks and Trust Companies. You shall not be liable to the Purchaser for any act or omission on the part of any broker or dealer in securities (a "Dealer "), bank or trust company, and you shall not be liable for your own acts or omissions in performing your obligations as Dealer Manager hereunder, except for any loss, damage, liability or expense primarily attributable to your negligence, bad faith or willful misconduct. In connection with the Offer, no Dealer, bank or trust company is to be deemed to be acting as your agent or the agent of the Purchaser, and you, as Dealer Manager, shall act as an independent contractor and are not to be deemed for any purpose to act as a joint venturer of, or be the agent of, the Purchaser. 4. The Offer Material. The Purchaser agrees, at its expense, to furnish you with as many copies as you may reasonably request of the invitation to tender and solicitation for consent, the letters of transmittal, the instruction form, the consent form and the related letters and documents, together with any supplements or amendments to any such documents, to be used by the Purchaser in connection with the Offer (such documents being Morgan Stanley & Co. Incorporated December 23, 1994 hereinafter referred to collectively as the "Offer Material "), and you are authorized to use copies of the Offer Material. The Purchaser will not file, use or publish any material in connection with the Offer, including the Offer Material, or refer to you in any such material, without your consent. 5. Scope of Services; Compensation. and Expenses. Your sole obligation as Dealer Manager shall be to act as a broker /dealer with respect to the Offer in those jurisdictions where the Offer is required by law to be made through a licensed broker or dealer. You shall have no obligation to solicit tenders of Certificates. The Purchaser agrees to pay you a fee (the "Dealer Manager Fee ") in the amount of $15.00 for each $5,000 principal amount of Certificates tendered and accepted for purchase, such fee to be payable concurrently with the payment for such Certificates by the Purchaser under the Offer. The Purchaser agrees to pay any Eligible Institution (as defined in the Offer Material) a solicitation fee of $15.00 for each $5,000 principal amount of Certificates tendered and accepted for purchase through such Eligible Institution. The Purchaser agrees to appoint Morgan Stanley & Co. Incorporated to act as the sole underwriter in connection with the sale of any obligations of the Purchaser issued in connection with the Offer and the plan of finance of which the Offer is a part. The Purchaser also agrees to pay all of the fees and expenses of the Tender Agent (as defined below) and all of your out -of- pocket expenses, including the reasonable fees and expenses of your counsel, in each case incurred in connection with the Offer. 6. Representations and Warranties of the Purchaser. The Purchaser hereby represents and warranties to you as follows: (i) The Purchaser is a municipal corporation duly created and validly existing under the Constitution and laws of the State of Texas (including the Purchaser's Home Rule Charter) and has the power to enter into and has duly authorized, by proper action, the execution and delivery of this Agreement and all other documents contemplated hereby to be executed by the Purchaser; (ii) This Agreement is the legal, valid and binding obligation of the Purchaser enforceable in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws and principles of equity relating to or affecting the enforcement of creditors' rights; (iii) The execution and delivery of this Agreement and the performance by the Purchaser of its obligations hereunder do not and will not violate the Purchaser' s Home Rule Charter or any existing ordinances of the Purchaser, or any court order by which the Purchaser is bound, and such actions do not and will not constitute a -2- Morgan Stanley & Co. Incorporated December 23, 1994 default under any material agreement, indenture, mortgage, lease, note or other obligation or instrument to which the Purchaser is a party or by which it is bound or to which any of its property is subject, and no approval or other action by any governmental authority or agency is required in connection therewith; (iv) The Purchaser has complied with, and will comply with, the requirements of all Texas and federal laws, regulations and rules applicable to the Offer, the Offer Material and this Agreement; (v) The Offer is in full compliance with all provisions of the Trust Agreement, as the same may be amended pursuant to the solicitation for consent contained in the Offer Material; (vi) The Offer Material, except with respect to information relating to the Operator (as defined in the Offer Material) which has been provided to the Purchaser by the Operator, does not, and at all times during the Offer will not, contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they are made, not misleading; (vii) The Purchaser has no reason to believe that the information in the Offer Material relating to the Operator, which has been provided to the Purchaser by the Operator, contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they are made, not misleading; (viii) The Purchaser will pay promptly, in accordance with the terms and subject to the conditions of the Offer, the full purchase price (and related fees and expenses) for such of the Certificates as the Purchaser elect to purchase pursuant to the Offer; (ix) There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before any court, government agency, public board or other governmental body, pending or, to the best knowledge of the Purchaser, threatened against the Purchaser affecting or seeking to prohibit, restrain or enjoin (A) the Offer or any transactions in connection with, or contemplated by, the Offer, the Offer Material or this Agreement, or (B) the execution of, and the performance by the Purchaser of its obligations under, this Agreement; and (x) The Purchaser does not have knowledge of any material fact or information concerning the Certificates or the security therefor which is not disclosed in the Offer Material. -3- Morgan Stanley & Co. Incorporated December 23, 1994 7. The Tender Agent. The Purchaser has arranged for Frost National Bank, Austin, Texas, to serve as tender agent (the "Tender Agent ") in connection with the Offer and to advise you daily during the period of the Offer as to the number of Certificates of each series that have been tendered and as to such other matters as you may reasonably request. 8. Additional Information and Notification. The Purchaser will advise you promptly of (i) the occurrence of any event that could cause the Purchaser to withdraw or rescind the Offer, (ii) any event that might require any change in the Offer Material, (iii) any litigation or administrative action with respect to the Offer and (iv) any other information relating to the Offer or any of the other transactions contemplated by the Offer Material or this Agreement that you may from time to time reasonably request. 9. Indemnification. To the extent permitted by law, the Purchaser hereby agrees to hold harmless and indemnify you, your affiliated entities and directors, officers, employees and agents of you and of your affiliated entities, and any person who controls you or any of your affiliated entities within the meaning of Section 15 of the Securities Act of 1933, as amended, or Section 20(a) of the Securities Exchange Act of 1934, as amended (individually, an "Indemnified Person" and collectively, the "Indemnified Persons "), against any and all losses, claims, damages, liabilities or costs (and all actions in respect thereof and any legal or other expenses in giving testimony or furnishing documents in response to a subpoena or otherwise), including the costs of investigating, preparing or defending any such action or claim, whether or not in connection with litigation in which an Indemnified Person is a party, as and when incurred, directly or indirectly, caused by, relating to, based upon or arising out of the Offer, the Offer Material or any transaction relating to the Offer or your engagement hereunder; provided, however, such indemnity agreement shall not apply to any breach by any Indemnified Person of any of the terms of this Agreement and to any such loss, claim, damage, liability or cost to the extent it is found in a final judgment by a court of competent jurisdiction (not subject to further appeal) to have resulted primarily and directly from the negligence, bad faith or willful misconduct of an Indemnified Person. These indemnification provisions shall be in addition to any liability that the Purchaser may otherwise have to the Indemnified Persons. If any action, proceeding, or investigation is commenced, as to which any Indemnified Person proposes to demand such indemnification, it will notify the Purchaser with reasonable promptness. The Indemnified Persons will have the right to retain separate counsel of their own choice subject to the approval of the Purchaser, which approval shall not be unreasonably withheld, to represent them, and the Purchaser will pay the fees and -4- Morgan Stanley & Co. Incorporated December 23, 1994 expenses of such counsel; and such counsel shall to the fullest extent consistent with professional responsibilities cooperate with the Purchaser and any counsel designated by the Purchaser. The Purchaser will be liable for any settlement of any claim against any Indemnified Person made with its written consent, which consent shall not be unreasonably withheld. If indemnification is for any reason not to be available hereunder with respect to any claim, loss or expense contemplated by the preceding paragraphs to be subject to indemnification, you and the Purchaser agree, to the extent permitted by law, to contribute to such loss, claim, damage, liability or cost in the proportion that your compensation payable hereunder bears to the aggregate value of the financial consideration to be paid by the Purchaser for all of the Certificates that are subject to the Offer (unless no Certificates are accepted for purchase, in which case such contribution shall be in the proportion that $15.00 bears to $5,000), with you paying the smaller portion and the Purchaser paying the larger portion. No investigation or failure to investigate by you shall impair the foregoing indemnification and contribution agreement or any rights you may have. 10. Conditions to Dealer Manager's Obligations. Your obligation to act as Dealer Manager with respect to the Offer shall at all times be subject to the conditions that: (i) the Purchaser at all times during the period of the Offer shall have performed all of its material obligations hereunder and with respect to the Offer which are theretofore required to have been performed; (ii) no restraining order shall have been issued and no litigation shall have been commenced or threatened with respect to the Offer or with respect to any of the transactions in connection with, or contemplated by, the Offer, the Offer Material or this Agreement before any court, government agency, public board or other governmental body of any jurisdiction that you, in good faith after consultation with the Purchaser, believe renders it inadvisable for you to continue to act as Dealer Manager hereunder; and (iii) the Purchaser shall provide you with an opinion of McCall, Parkhurst & Horton L.L.P. to the effect that (A) this Agreement is a valid and binding agreement of the Purchaser, subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws and principles of equity relating to or affecting the enforcement of creditors' rights and (B) based on such firm's participation in the Offer as counsel to the Purchaser, no facts have come to attention of such firm that lead such firm to believe that the Offer Material contains any untrue statement of a material -5- Morgan Stanley & Co. Incorporated December 23, 1994 fact or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. 11. Survival of Certain Provisions. The representations and warranties, indemnification and contribution provisions and other agreements of the Purchaser contained in this Agreement shall remain operative and in full force and effect regardless of (i) the making, withdrawal or termination, or consummation of, or failure to commence, the Offer, (ii) any investigation made by or on behalf of any Indemnified Person or (iii) any termination of this Agreement. 12. Successors and Assigns. Etc. This Agreement, including, without limitation, any right to indemnification, shall be binding upon you and the Purchaser, and the respective successors and assigns thereof, and shall inure to the benefit of the Purchaser, you and the other Indemnified Persons, and the respective successors and assigns thereof. Nothing in this Agreement is intended, or shall be construed, to give to any other person or entity any right under or by virtue of this Agreement. 13. Miscellaneous. In the event that any provision of this Agreement shall be determined to be invalid or unenforceable in any respect, such determination shall not affect such provision in any other respect or any other provision of this Agreement, which shall remain in full force and effect. This Agreement may be executed in one or more separate counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 14. Notices. Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be mailed by certified mail, return receipt requested, or delivered against receipt to the party to whom it is to be given at the address of such party as set forth below: To the Purchaser: City of Round Rock, Texas 221 East Main Street Round Rock, Texas 78664 Attention: Mr. Steve Sheets, City Attorney -6- Morgan Stanley & Co. Incorporated December 23, 1994 To Morgan Stanley & Co. Incorporated: Morgan Stanley & Co. Incorporated 1330 Bank One Tower 221 West Sixth Street Austin, Texas 78701 -3404 Attention: Mr. Charles Jennings 15. Confidentiality. The Purchaser agrees not to disclose the provisions of this Agreement to any other person unless it reasonably determines that the failure to make such disclosure would violate applicable law or otherwise materially adversely affect its interests. 16. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas. -7- Morgan Stanley & Co. Incorporated December 23, 1994 Please indicate your willingness to act as Dealer Manager and your acceptance of the foregoing provisions by signing in the space provided below for that purpose and returning to us a copy of this Agreement so signed, whereupon this Agreement and your acceptance shall constitute a binding agreement between us. Accepted on the date first above written: MORGAN STANLEY & CO. INCORPORATED By: Name: Title: f:\ tinan\go0959\mor420Welman -3.agt Very truly yours, CITY OF ROUND ROCK, TEXAS By: Name: Title: -8- December 22, 1994 Frost National Bank 816 Congress, 4th Floor Austin, Texas 78768 Ladies & Gentlemen: THE CITY OF ROUND ROCK 221 East Main Street Round Rock, Texas 78664 TENDER AGENT AGREEMENT The City of Round Rock, Texas (the "City") is inviting holders of the Golf Course Trust Certificates, Series 1989 (referred to as the "Certificates ") to submit offers to sell the Certificates for cash plus accrued interest to the date of purchase and to consent to certain amendments upon the terms and conditions specified in the Invitation to Tender and Solicitation for Consent dated December 23, 1994 (referred to as the "Invitation "). References hereinafter to "you" shall refer to Frost National Bank. The City hereby appoints you to act as Tender Agent in connection with the Invitation, and you hereby accept the appointment as Tender Agent for the Invitation. The Invitation will commence on December 23, 1994. The Letter of Transmittal that accompanies the Invitation is to be used by holders to tender their Certificates and contains instructions with respect to the delivery of Certificates (or to effect book -entry transfer of Certificates). In carrying out your duties as Tender Agent, you are to act in accordance with the following: 1. The offer shall expire at 5:00 p.m. New York City time, on Wednesday, February 1, 1995 (the "Initial Expiration Date "), or at such earlier or later time as determined within the sole discretion of the City as set forth in the Invitation. The City shall give written notice to the Tender Agent of any such early termination or extension of the Invitation. 2. You are directed to establish and maintain an account with respect to the Certificates at The Depository Trust Company (referred to as the "Book -Entry Transfer Facility" or "Facility ") for purposes of the Invitation, within two business days after the date of this Invitation. Any financial institution that is a participant in The Depository Trust Company may make book -entry delivery of Certificates by causing The Depository Trust Company to transfer such Certificates into the Tender Agent's account, in accordance with The Depository Trust Company's Automated Tender Offer Program (ATOP). The account at the Facility shall be maintained until all Certificates received by you pursuant to the Offer have either been paid or returned. 3. You are to examine the Letters of Transmittal and other documents delivered or mailed to you by or for the certificate- holders to ascertain whether (i) the Letters of Transmittal are properly executed and properly completed in accordance with the instructions set forth therein, (ii) the other documents required to be submitted are properly executed and completed and (iii) the Certificates have otherwise been tendered in accordance with the instructions provided. In each case where a Letter of Transmittal or other document has been improperly executed or completed or, for any other reason, is not in proper form, or some other irregularity in connection with the tender exists, and if the time available to you so permits, you will endeavor to notify by appropriate means the nature of such irregularity and of the appropriate resolution of the irregularity by appropriate means. Determination of all questions as to the proper completion or execution of a Letter of Transmittal or as to any other irregularity in connection with the tender of Certificates shall be made by you, together with officials of or counsel for the City, and any determinations made by the City shall be final and binding 4. Tender of Certificates may be made only as set forth in the Invitation to Tender. Letters of Transmittal shall be noted by you as to the date and time of receipt and shall be preserved and retained by you. Payment for Certificates tendered and accepted pursuant to the Invitation is to be made only against deposit with you of Certificates (or book -entry transfer of Certificates) together with executed Letters of Transmittal and other required documents. 5. On each business day up to and including the Expiration Date, you are to advise by telephone or facsimile transmission, as hereinafter indicated and promptly thereafter confirm in writing to such individual with the Information Agent and First Southwest Company as directed by those officials of the City set forth in Sections 6 hereinbelow and to such other persons as such official may request in writing, which may be delivered by facsimile, the aggregate principal amount of Certificates which have been properly tendered pursuant to the Invitation and the aggregate principal amount of Certificates properly tendered on that day. In addition you will also inform such persons upon oral request made form time to time prior to the Expiration Date of such other information as they may reasonably request. 6. A City Official or agent of the City will confirm to you in writing that the tendered Certificates are to be accepted pursuant to the Invitation. If the Certificates are accepted and paid for, the Certificates are to be processed as instructed by the City (or a representative of the City). 7. As soon as practicable after the City notifies you that the City accepts the tendered Certificates pursuant to paragraph 6 above and upon receipt by you from the City of immediately available funds in amounts covering the aggregate purchase price of Certificates to be purchased pursuant to and such election, you shall deliver over your window or send by first -class mail postage prepaid to, or at the direction of, each holder of Certificates being purchased, a check for the purchases price of the Certificates so purchased, in United States currency. -2- 8. Tenders of Certificates pursuant to the Invitation are irrevocable, except as set forth in the Invitation to Tender. 9. If, pursuant to the terms of the Invitation, the City does not accept and pay for and or all Certificates tendered, or Certificates are submitted but withdrawn in the manner provided in the Invitation to Tender, you shall promptly return the Certificates, or effect appropriate book -entry transfer, as directed by such certificate- holder in the Letter of Transmittal. 10. For your services as Tender Agent hereunder, the City shall pay you the fees set forth in Exhibit A. The City will also reimburse you for your reasonable out -of - pocket expenses (including, but not limited to, counsel fees and disbursements, if any) in connection with your services promptly after submission to the City of itemized statements, in reasonable detail. 11. As Tender Agent hereunder you: (a) shall have no duties or obligations other than those specifically set forth herein, in the Invitation to Tender, in the Letter of Transmittal, or in the Letters of Representation with the Book -Entry Transfer Facility executed in connection with the issuance of the Certificates; (b) will be regarded as making no representations and having no responsibilities as to the validity, sufficiency, value or genuineness of Certificates represented thereby, deposited with you hereunder, and will not be required to and will make no representation as to the validity, value or genuineness of the Invitation to Tender; (c) shall not by obligated to take any legal action hereunder that may in your judgement involve any expense or liability, unless you have been furnished with indemnity reasonably satisfactory to you; (d) may rely on any certificate, instrument, opinion, notice, letter, telegram or other document or security delivered to you and believed by you to be genuine and to have been signed by the proper party or parties; (e) may rely on and shall be protected in acting upon the written instruction of those officials of the City set forth in Section 6 hereof, or such other official or designee of the City as may be designated by the City; (f) may consult with counsel satisfactory to you and the opinion of such counsel shall be full and complete authorization and protection with respect of any action taken suffered or omitted by you hereunder in good faith and in accordance with the opinion of such counsel; and (g) shall not at any time advise any person as to the wisdom of the Invitation or as to the market value or decline or appreciation in market value of any Certificates. -3- 12. TO THE EXTENT PERMITTED BY TEXAS LAW, THE CITY COVENANTS AND AGREES TO INDEMNIFY YOU AND HOLD YOU HARMLESS AGAINST ANY LOSS, CLAIM DAMAGE, LIABILITY INCLUDING ANY LIABILITY UNDER UNITED STATES FEDERAL SECURITIES LAWS OR EXPENSE INCLUDING REASONABLE LEGAL OR OTHER FEES AND EXPENSE, JOINT OR SEVERALLY INCURRED WITHOUT NEGLIGENCE ON YOUR PART AND ARISING OUT OF OR IN CONNECTION WITH YOUR ENTERING INTO THIS AGREEMENT OR THE PERFORMANCE OF YOUR DUTIES HEREUNDER. YOU SHALL NOTIFY THE CITY BY LETTER OR BY CABLE OR BY TELEX CONFIRMED BY LETTER OF THE WRITTEN ASSERTION OF A CLAIM AGAINST YOU OR OF ANY ACTION COMMENCED AGAINST YOU AS TENDER AGENT, PROMPTLY AFTER YOU SHALL HAVE RECEIVED ANY SUCH WRITTEN ASSERTION OR CLAIM OR SHALL HAVE BEEN SERVED WITH A SUMMONS. OR OTHER LEGAL PROCESS, GIVING INFORMATION AS TO THE NATURE AND BASIS OF THE CLAIM BUT THE OMISSION TO NOTIFY THE CITY WILL NOT RELIEVE IT FROM ANY LIABILITY WHICH IT MAY HAVE TO YOU OTHERWISE UNDER THIS SECTION 12 EXCEPT TO THE EXTENT THAT THE CITY IS ABLE TO DEMONSTRATE ACTUAL PREJUDICE IN NOT BEING NOTIFIED. THE CITY SHALL BE ENTITLED TO PARTICIPATE AT ITS EXPENSE IN THE DEFENSE AGAINST ANY SUCH CLAIM OR LEGAL ACTION, AND IF THE CITY SO REQUESTS AT ANY TIME AFTER RECEIPT OF SUCH NOTICE, THE CITY MAY ASSUME THE DEFENSE OF ANY SUIT BROUGHT TO ENFORCE ANY SUCH CLAIM. IN THE EVENT THE CITY ASSUMES THE DEFENSE, THE CITY SHALL NOT BE LIABLE FOR ANY FEES AND EXPENSES THEREAFTER INCURRED BY YOUR COUNSEL. 13. This Agreement shall be construed and enforced in accordance with the laws of the State of Texas without reference to its provisions on conflicts of laws and shall inure to the benefit of, and the obligations created hereby shall be binding upon, the successors and assigns of the parties hereto. This Agreement may not be modified orally. Any inconsistency between this Agreement and the Invitation to Tender, related Letter of Transmittal as they may from time to time be amended, shall be resolved in favor of the Invitation to Tender, related Letter of Transmittal, except with respect to the duties, liabilities and indemnification of you as Tender agent. You hereby expressly waive any lien, encumbrance of right of set -off that you may have with respect to funds deposited with you for the purchase of Certificates. 14. This Agreement and all of the obligations hereunder shall be assumed by any and all successors and assigns of the City. 15. This agreement shall not obligate the Tender Agent to take any action that would compromise it in respect to its duties as Trustee of the Certificates issued pursuant to the terms of a trust agreement dated as of December 1, 1989. -4- Please acknowledge receipt of this Agreement and confirm the arrangements herein provided by signing and returning the enclosed copy. Accepted and agreed: THE FROST NATIONAL BANK, AS TENDER AGENT By: Name: Title: Date: Very truly yours, THE CITY OF ROUND ROCK By: Name: Title: Date: -5- Exhibit A FROST NATIONAL BANK AUSTIN FEE SCHEDULE TENDER PROGRAM CITY OF ROUND ROCK, TEXAS ACCEPTANCE FEE $ 500.00 *ASSIST ISSUER & COUNSEL WITH THE SET -UP OF TRANSACTION *REVIEW DOCUMENTS *ADMINISTRATE ACCOUNT MAIL LE OF TRANSMITTAL(EACH) *LABEL PRODUCTION $ 0.06 IMPRINTING BURSTING *ENCLOSE & MAIL L.T. & ANCILLARY DOCUMENTS(MACHINABLE FORMAT) $ 0.16 COORDINATE WITH FINANCIAL PRINTER PROCESS LETTER OF TRANSMITTAL(EACH) $ 10.00 *REVIEW & EXAMINE L.T. & ACCOMPANYING SECURITIES *CALCULATE CASH ENTITLEMENT *GENERATE CHECK *DAILY & FINAL REPORTING *PREPARE & FILE FORM 1099B SPECIAL HANDLING ITEMS(EACH) $ 7.50 *DEFICIENT PRESENTATIONS *LEGAL PRESENTATIONS *WINDOW PRESENTATIONS *TRANSFER ITEMS *NO CHARGE FOR EXTENSION OF OFFER *OUT OF POCKET EXPENSES, AS INCURRED *MINIMUM FEE FOR THIS JOB $3,500.00 THE ABOVE FEES ARE BASED ON INFORMATION RECEIVED TO DATE AND ARE SUBJECT TO CHANGE SHOULD ADDITIONAL SERVICES BE REQUIRED RESOLUTION APPROVING FIRST SUPPLEMENTAL TRUST AGREEMENT AND FIRST SUPPLEMENTAL LEASE AGREEMENT WHEREAS, the City of Round Rock, Texas (the "City") has previously executed a "Golf Course Construction and Lease/ Purchase Agreement" dated as of December 1, 1989 (the "Lease ") between the City, as lessee and Round Rock Golf, Inc., as lessor in connection with the acquisition, construction and financing of a public golf course; and WHEREAS, in furtherance of the acquisition, construction and financing of the golf course, a Trust Agreement dated as of December 1, 1989 by and among the City of Round Rock, Texas, First City, Texas - Austin N.A., as Trustee and Round Rock Golf, Inc. (the "Trust Agreement ") was executed in connection with the issuance of $6,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates "); and WHEREAS, the City deems it advisable and necessary to amend the Lease and Trust Agreement to clarify the City's ability to provide for the prepayment of lease payments under the Lease and therefore releasing and defeasing its obligations under the Lease, Trust Agreement and Certificates; and WHEREAS, pursuant to Section 15.4 of the Lease, the Lease can be modified by written amendment of the lessee and the lessor as provided in the Trust Agreement; and WHEREAS, pursuant to Article X of the Trust Agreement, the Trust Agreement can be modified or amended at any time by a supplemental agreement executed by the City and the lessor which amendment shall become effective when the written consents of the owners of 60% in aggregate principal amount of the Certificates outstanding shall be filed with the Trustee; and WHEREAS, the lessor and lessee will be soliciting the consent to the First Supplemental Trust Agreement and First Supplemental Lease Agreement by 60% of the owners of the Certificates as required by Article X of the Trust Agreement; and WHEREAS, the Trust Agreement and Lease shall be deemed modified and amended by the First Supplemental Trust Agreement dated as of December 1, 1994 and the First Supplemental Lease Agreement dated as of December 1, 1994, respectively, in substantially the form attached hereto as Exhibit "A "; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ROUND ROCK, TEXAS: Section 1. Recitals and Approval of Supplemental Agreements. The recitals set forth in the preamble hereof are incorporated by reference herein and shall have the same force and effect as if set forth in this Section. The City hereby approves the First Supplemental Trust Agreement and First Supplemental Lease Agreement in substantially the form attached hereto as Exhibit "A" and the Mayor or City Manager are hereby authorized to execute the agreements and the City Secretary is hereby authorized to attest such agreements. Section 2. Further Procedures. The Mayor or City Manager, City Secretary, the Director of Finance and all other officers, employees and agents of the City, including the City's Financial Advisor and attorneys, and each of them, shall be and they are hereby expressly authorized, empowered and directed from time to time and at any time to do and perform all such acts and things to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the City all instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Resolution, the First Supplemental Trust Agreement and First Supplemental Lease Agreement, the amendment of such agreements and other matters in connection therewith. Section 3. Full Force and Effect. Except as expressly amended and modified as set forth in Exhibit "A" attached hereto, all terms and provisions of the Lease and the Trust Agreement, respectively shall remain in full force and effect and the City hereby ratifies, confirms and adopts the Lease and Trust Agreement as amended and modified by the First Supplemental Trust Agreement and First Supplemental Lease Agreement. EXHIBIT A FIRST SUPPLEMENTAL GOLF COURSE CONSTRUCTION AND LEASE/PURCHASE AGREEMENT This First Supplemental Golf Course Construction and Lease/Purchase Agreement ( "First Supplement ") dated as of December 1, 1994 is entered into by and between the City of Round Rock, Texas, as lessee (the "Lessee ") and Round Rock Golf, Inc., as lessor (the "Lessor "), WITNESSETH: WHEREAS, the Lessor and Lessee have previously executed a "Golf Course Construction and Lease/Purchase Agreement" dated as of December 1, 1989 (the "Lease ") in connection with the acquisition, construction and financing of a public golf course; and WHEREAS, the Lessor and Lessee deem it advisable and necessary to amend the Lease, pursuant to the provisions of Section 15.4 to clarify the Lessee's ability to provide for the prepayment and defeasance of lease payments under the Lease and therefore releasing and defeasing its obligations under the Lease. NOW, THEREFORE, the parties hereto agree as follows: 1. Section 10.3 of the Lease is deleted in its entirety and is hereby amended to read in its entirety as follows: Section 10.03. Prepayment of Lease Payments and/or purchase of Project and Release of Lessor's Interest. Notwithstanding any other provision of this Lease Agreement to the contrary, the Lessee shall have the option to purchase the Project and/or make provision to prepay any of the remaining Lease Payments on any date by irrevocably depositing with or making available to the Trustee for such payment (1) lawful money of the United States of America sufficient to make such payment, (2) Government Obligations which mature as to principal and interest in such amounts and in such times to ensure the availability, without reinvestment, of sufficient money to provide for such Lease Payments as further set forth in Section 14.01 of the Trust Agreement as amended by the First Supplemental Trust Agreement dated as of December 1, 1994. Upon exercise by the Lessee of its option to purchase the Property by paying or making provision for the payment of all remaining Lease Payments and any other amounts then due or past due, Lessee shall have no further obligations under this Lease Agreement and the Ground Lease and Lessor and Trustee shall take all actions necessary to authorize, execute and deliver to Lessee any and all documents necessary to vest in Lessee, all of the Lessor's and Trustee's right, title and interest in and to the Project, free and clear of all liens, leasehold interests and encumbrances, including, if necessary, a release of any and all liens or interest created under the provisions of this Lease Agreement or the Ground Lease. 2. Except as expressly amended and modified hereby, all terms and provision of the Lease shall remain in full force and effect, and the Lessor and Lessee hereby ratify, confirm and adopt the Lease as amended and modified hereby. IN WITNESS WHEREOF, the parties hereto have caused this First Supplement to be duly executed by their respective authorized officers as of the day and year first above written and effective upon the receipt of the necessary consents. ATTEST: By: City Secretary ATTEST: By: Title: CITY OF ROUND ROCK, TEXAS, AS LESSEE By: Title: ROUND ROCK GOLF, INC., AS LESSOR By: Title: FIRST SUPPLEMENTAL TRUST AGREEMENT This First Supplemental Trust Agreement ( "First Supplement ") dated as of December l, 1994 is entered into by and among the City of Round Rock, Texas (the "City "), Frost National Bank, as Trustee (as successor trustee to First City, Texas- Austin, N.A.) (the "Trustee ") and Round Rock Golf, Inc. (the "Corporation "). WITNESSETH: WHEREAS, the Trustee, the Corporation and the City have previously executed a "Trust Agreement" dated as of December 1, 1989 (the "Trust Agreement ") in connection with the issuance by the Trustee of $6,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates ") evidencing proportional interests in certain lease payments made by the City under the Lease Agreement dated as of December 1, 1989 between the City and the Corporation; and WHEREAS, the City and the Corporation deem it advisable and necessary to amend the Trust Agreement pursuant to the provisions of Article X thereof to clarify the ability to provide for the payment or prepayment of the Certificates and Lease Payments and therefore releasing and defeasing the obligations of the City and the Corporation under the Trust Agreement and Lease. NOW, THEREFORE, the parties hereto agree as follows: 1. Section 14.01 of the Trust Agreement is deleted in its entirety and is hereby amended to read in its entirety as follows: Section 14.01. DEFEASANCE OF CERTIFICATES AND LEASE PAYMENTS. (a) Any Certificate and the interest thereon and Lease Payments shall be deemed to be paid, retired, and no longer outstanding (a "Defeased Obligation ") within the meaning of this Trust Agreement and the Lease Agreement, respectively, except to the extent provided in subsection (d) of this Section 14.01, when payment of the principal of such Certificate, plus interest thereon to the due date (whether such due date be by reason of maturity, upon redemption, or otherwise) and premium, if any, and the I PaCP Payment either (i) shall have been made or caused to be made in accordance with the terms thereof (including the giving of any required notice of redemption), or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Trustee for such payment (1) lawful money of the United States of America sufficient to make such payment, (2) Government Obligations which mature as to principal and interest in such amounts and at such times as will ensure the availability, without reinvestment, of sufficient money to provide for such payment and when proper arrangements have been made with the Trustee for the payment of its services until all Defeased Obligations shall have become due and payable or (3) a combination of (1) and (2). At such time as a Certificate shall be deemed to be a Defeased Obligation hereunder, as aforesaid, such Certificate and the interest thereon and the Lease Payments shall no longer be secured by, payable from, or entitled to the benefits of, the Trust Agreement and Lease Agreement, as provided herein, and such principal and interest shall be payable solely from such money or Government Obligations. (b) Any moneys so deposited with the Trustee may at the written direction of the City also be invested in Government Obligations, maturing in the amounts and times as hereinbefore set forth, and all income from such Government Obligations received by the Trustee which is not required for the payment of the Certificates and interest thereon with respect to which such money has been so deposited, shall be turned over to the City, or deposited as directed in writing by the City. (c) The term "Government Obligations" as used in this Section, shall mean direct non - callable obligations of the United States of America, including, obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, which may be United States Treasury obligations such as its State and Local Government Series, which may be in book -entry form. (d) Until all Defeased Obligations shall have become due and payable, the Trustee shall perform the services of Trustee and paying agent/registrar for such Defeased Obligations the same as if they had not been defeased, and the City shall make proper arrangements to provide and pay for such services as required by this Trust Agreement. In the event of a deposit set forth in (a)(ii) of this Section, the Certificates shall continue to represent direct and proportionate interests of the owners thereof in I ease Payments under the i paC 2. Except as expressly amended and modified hereby, all terms and provisions of the Lease shall remain in full force and effect, and the Lessor and Lessee hereby ratify, confirm and adopt the Lease as amended and modified hereby. IN WITNESS WHEREOF, the parties hereto have caused this First Supplement to be duly executed by their respective authorized officers as of the day and year first above written and effective upon the receipt of the necessary consents. ATTEST: By: City Secretary ATTEST: By: Title: ATTEST: By: Title: CITY OF ROUND ROCK, TEXAS By: Title: ROUND ROCK GOLF, INC. By: Title: FROST NATIONAL BANK, AS TRUSTEE By: Title: RESOLUTION APPROVING FIRST SUPPLEMENTAL TRUST AGREEMENT AND FIRST SUPPLEMENTAL LEASE AGREEMENT WHEREAS, Round Rock Golf, Inc., (the "Corporation ") has previously executed a "Golf Course Construction and Lease/Purchase Agreement" dated as of December 1, 1989 (the "Lease ") between the City of Round Rock, Texas (the "City"), as lessee and the Corporation, as lessor in connection with the acquisition, construction and financing of a public golf course; and WHEREAS, in furtherance of the acquisition, construction and financing of the golf course, a Trust Agreement dated as of December 1, 1989 by and among the City of Round Rock, Texas, First City, Texas - Austin N.A., as Trustee and Round Rock Golf, Inc. (the "Trust Agreement ") was executed in connection with the issuance of $6,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates "); and WHEREAS, the Corporation and the City deem it advisable and necessary to amend the Lease and Trust Agreement to clarify the City's ability to provide for the prepayment of lease payments under the I as and therefore releasing and defeasing its obligations under the Lease, Trust Agreement and Certificates; and WHEREAS, pursuant to Section 15.4 of the Lease, the Lease can be modified by written amendment of the lessee and the lessor as provided in the Trust Agreement; and WHEREAS, pursuant to Article X of the Trust Agreement, the Trust Agreement can be modified or amended at any time by a supplemental agreement executed by the City and the lessor which amendment shall become effective when the written consents of the owners of 60% in aggregate principal amount of the Certificates outstanding shall be filed with the Trustee; and WHEREAS, the lessor and lessee will be soliciting the consent to the First Supplemental Trust Agreement and First Supplemental Lease Agreement by 60% of the owners of the Certificates as required by Article X of the Trust Agreement; and WHEREAS, the Trust Agreement and Lease shall be deemed modified and amended by the First Supplemental Trust Agreement dated as of December 1, 1994 and the First Supplemental I ease Agreement dated as of December 1, 1994, respectively, in substantially the form attached hereto as Exhibit "A "; NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF ROUND ROCK GOLF, INC.: Section 1. Recitals and Approval of Supplemental Agreements. The recitals set forth in the preamble hereof are incorporated by reference herein and shall have the same force RROCK/GOIF: GOLHNC.RE312/21/94 and effect as if set forth in this Section. The Corporation hereby approves the First Supplemental Trust Agreement and First Supplemental Lease Agreement in substantially the form attached hereto as Exhibit "A" and the President or Vice President are hereby authorized to execute the agreements and the Secretary or Assistant Secretary are hereby authorized to attest such agreements. Section 2. Further Procedures. The President or Vice President, Secretary, and all other officers, employees and agents of the Corporation, including the Corporation's Financial Advisor and attorneys, and each of them, shall be and they are hereby expressly authorized, empowered and directed from time to time and at any time to do and perform all such acts and things to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the Corporation all instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Resolution, the First Supplemental Trust Agreement and First Supplemental Lease Agreement, the amendment of such agreements and other matters in connection therewith. Section 3. Full Force and Effect. Except as expressly amended and modified as set forth in Exhibit "A" attached hereto, all terms and provisions of the Lease and the Trust Agreement, respectively shall remain in full force and effect and the Corporation hereby ratifies, confirms and adopts the Lease and Trust Agreement as amended and modified by the First Supplemental Trust Agreement and First Supplemental Lease Agreement. RROCKOOua omtwc.REstarzirea FIRST SUPPLEMENTAL TRUST AGREEMENT This First Supplemental Trust Agreement ("First Supplement ") dated as of December 1, 1994 is entered into by and among the City of Round Rock, Texas (the "City"), Frost National Bank, as Trustee (as successor trustee to First City, Texas - Austin, N.A.) (the "Trustee ") and Round Rock Golf, Inc. (the "Corporation "). WITNESSETH: WHEREAS, the Trustee, the Corporation and the City have previously executed a "Trust Agreement" dated as of December 1, 1989 (the "Trust Agreement ") in connection with the issuance by the Trustee of $6,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificate?) evidencing proportional interests in certain lease payments made by the City under the Lease Agreement dated as of December 1, 1989 between the City and the Corporation; and WHEREAS, the City and the Corporation deem it advisable and necessary to amend the Trust Agreement pursuant to the provisions of Article X thereof to clarify the ability to provide for the payment or prepayment of the Certificates and Lease Payments and therefore releasing and defeasing the obligations of the City and the Corporation under the Trust Agreement and Lease. NOW, THEREFORE, the parties hereto agree as follows: 1. Section 14.01 of the Trust Agreement is deleted in its entirety and is hereby amended to read in its entirety as follows: Section 14.01. DEFEASANCE OF CERTIFICATES AND LEASE PAYMENTS. (a) Any Certificate and the interest thereon and Lease Payments shall be deemed to be paid, retired, and no longer outstanding (a "Defeased Obligation ") within the meaning of this Trust Agreement and the Lease Agreement, respectively, except to the extent provided in subsection (d) of this Section 14.01, when payment of the principal of such Certificate, plus interest thereon to the due date (whether such due date be by reason of maturity, upon redemption, or otherwise) and premium, if any, and the Lease Payment either (i) shall have been made or caused to be made in accordance with the terms thereof (including the giving of any required notice of redemption), or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Trustee for such payment (1) lawful money of the United States of America sufficient to make such payment, (2) Government Obligations which mature as to principal and interest in such amounts and at such times as will ensure the availability, without reinvestment, of sufficient money to provide for such payment and when proper arrangements have been made with the Trustee for the payment of its services until all Defeased Obligations shall have become due and payable or (3) a combination of (1) and (2). At such time as a Certificate shall be deemed to be a Defeased Obligation hereunder, as aforesaid, such Certificate and the interest thereon and the Lease Payments shall no longer be secured by, payable from, or entitled to the benefits of, the Trust Agreement and Lease Agreement, as provided herein, and such principal and interest shall be payable solely from such money or Government Obligations. (b) Any moneys so deposited with the Trustee may at the written direction of the City also be invested in Government Obligations, maturing in the amounts and times as hereinbefore set forth, and all income from such Government Obligations received by the Trustee which is not required for the payment of the Certificates and interest thereon with respect to which such money has been so deposited, shall be turned over to the City, or deposited as directed in writing by the City. (c) The term "Government Obligations" as used in this Section, shall mean direct non - callable obligations of the United States of America, including, obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, which may be United States Treasury obligations such as its State and Local Government Series, which may be in book -entry form. (d) Until all Defeased Obligations shall have become due and payable, the Trustee shall perform the services of Trustee and paying agent/registrar for such Defeased Obligations the same as if they had not been defeased, and the City shall make proper arrangements to provide and pay for such services as required by this Trust Agreement. In the event of a deposit set forth in (a)(ii) of this Section, the Certificates shall continue to represent direct and proportionate interests of the owners thereof in Lease Payments under the Lease. 2. Except as expressly amended and modified hereby, all terms and provisions of the Lease shall remain in full force and effect, and the Lessor and Lessee hereby ratify, confirm and adopt the Lease as amended and modified hereby. IN WITNESS WHEREOF, the parties hereto have caused this First Supplement to be duly executed by their respective authorized officers as of the day and year first above written and effective upon the receipt of the necessary consents. ATTEST: By: City Secretary ATTEST: By: Title: ATTEST: By: Title: CITY OF ROUND ROCK, TEXAS By: Title: ROUND ROCK GOLF, INC. By: Title: FROST NATIONAL BANK, AS TRUSTEE By: Title: FIRST SUPPLEMENTAL GOLF COURSE CONSTRUCTION AND LEASE/PURCHASE AGREEMENT This First Supplemental Golf Course Construction and Lease/Purchase Agreement ( "First Supplement ") dated as of December 1, 1994 is entered into by and between the City of Round Rock, Texas, as lessee (the "Lessee ") and Round Rock Golf Inc., as lessor (the "Lessor "). WITNESSETH: WHEREAS, the Lessor and Lessee have previously executed a "Golf Course Construction and Lease/Purchase Agreement" dated as of December 1, 1989 (the "Lease ") in connection with the acquisition, construction and financing of a public golf course; and WHEREAS, the Lessor and Lessee deem it advisable and necessary to amend the Lease, pursuant to the provisions of Section 15.4 to clarify the Lessee's ability to provide for the prepayment and defeasance of lease payments under the Lease and therefore releasing and defeasing its obligations under the Lease. NOW, THEREFORE, the parties hereto agree as follows: 1. Section 10.3 of the Lease is deleted in its entirety and is hereby amended to read in its entirety as follows: Section 10.03. Prepayment of Lease Payments and/or purchase of Project and Release of Lessor's Interest. Notwithstanding any other provision of this Lease Agreement to the contrary, the Lessee shall have the option to purchase the Project and/or make provision to prepay any of the remaining Lease Payments on any date by irrevocably depositing with or making available to the Trustee for such payment (1) lawful money of the United States of America sufficient to make such payment, (2) Government Obligations which mature as to principal and interest in such amounts and in such times to ensure the availability, without reinvestment, of sufficient money to provide for such Lease Payments as further set forth in Section 14.01 of the Trust Agreement as amended by the First Supplemental Trust Agreement dated as of December 1, 1994. Upon exercise by the Lessee of its option to purchase the Property by paying or making provision for the payment of all remaining Lease Payments and any other amounts then due or past due, Lessee shall have no further obligations under this Lease Agreement and the Ground Lease and Lessor and Trustee shall take all actions necessary to authorize, execute and deliver to Lessee any and all documents necessary to vest in Lessee, all of the Lessor's and Trustee's right, title and interest in and to the Project, free and clear of all liens, leasehold interests and encumbrances, including, if necessary, a release of any and all liens or interest created under the provisions of this Lease Agreement or the Ground Lease. 2. Except as expressly amended and modified hereby, all terms and provision of the Lease shall remain in full force and effect, and the Lessor and Lessee hereby ratify, confirm and adopt the Lease as amended and modified hereby. IN WITNESS WHEREOF, the parties hereto have caused this First Supplement to be duly executed by their respective authorized officers as of the day and year first above written and effective upon the receipt of the necessary consents. ATTEST: By: City Secretary ATTEST: By: Title: CITY OF ROUND ROCK, TEXAS, AS LESSEE By: Title: ROUND ROCK GOLF, INC., AS LESSOR By: Title: RESOLUTION APPROVING FORM OF DISCLOSURE DOCUMENT IN CONNECTION WITH OUTSTANDING CITY OF ROUND ROCK, TEXAS GOLF COURSE TRUST CERTIFICATES, SERIES 1989, DISTRIBUTION OF DISCLOSURE DOCUMENT AND OTHER MATTERS RELATED THERETO WHEREAS there are currently outstanding $6,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates ") issued pursuant to a Trust Agreement dated as of December 1, 1989 (the "Trust Agreement ") which evidence proportional interests in certain lease payments pursuant to a Lease Agreement dated as of December 1, 1989 (the "Lease Agreement ") by and between the City, as lessee and Round Rock Golf, Inc., as lessor; and WHEREAS, such Certificates were issued in connection with the acquisition, construction and financing of a public golf course within the City; and WHEREAS, the City is considering various strategic alternatives related to the financing of the golf course; and WHEREAS, attached hereto is a substantially final form of an Invitation to Tender and Solicitation for Consent and various related documents (collectively, the "Disclosure Document ") which sets forth the options the City is considering regarding the outstanding Certificates; and WHEREAS, Morgan Stanley & Co. Incorporated is serving as Dealer Manager and Frost National Bank is serving as tender agent in connection with the Disclosure Document. WHEREAS, the City deems it advisable and necessary at this time to authorize its consultants to distribute the Disclosure Document and to do all things necessary in connection therewith. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ROUND ROCK, TEXAS: Section 1. Approval and Distribution. The recitals set forth in the preamble hereof and incorporated by reference herein shall have the same force and effect as if set forth in this Section. The City hereby approves the Disclosure Document in substantially the form attached hereto with such changes, additions or deletions as directed by the City Manager and the City's consultants are hereby authorized and directed to distribute the Disclosure Document to the owners of the Certificates and such other market participants as deemed necessary and advisable. Section 2. Approval of Dealer Manager Agreement and Tender Agent Agreement. The City hereby approves the Dealer Manager Agreement and Tender Agent Agreement in substantially the form attached hereto. The Mayor or City Manager are hereby authorized to RROCKiGO1F: DISCLOSLI.RES 12/01/94 execute such agreements and the City Secretary is hereby authorized to attest such agreements. The City Manager is hereby authorized to complete, amend and modify such agreements as necessary. Section 3. Further Procedures. The Mayor or City Manager and City Secretary of the City, the Director of Finance of the City and all other officers, employees and agents of the City, including the City's Financial Advisor and attorneys, and each of them, shall be and they are hereby expressly authorized, empowered and directed from time to time and at any time to do and perform all such acts and things to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the City all instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Resolution, the First Supplemental Trust Agreement and First Supplemental Lease Agreement, the amendment of such agreements and other matters in connection therewith. RROCR/GOIP: DISC OSU.RBB 12 /01/94 Maturity s., .., 1 oral Principal I 1.1114 . el t• 12/1/96 8.50% 8140,000 779228 AA3 12/1/97 8.75% 8155,000 779228 AB1 12/1/98 9.00% 8165,000 779228 AC9 12/1/99 9.10% 8180,000 779228 AD7 12/1/00 9.20% 3200,000 779228 AE5 12/1/01 9.30% 3215,000 779228 AF2 12/1/02 9.40% 8235,000 779228 AGO 12/1/03 9.50% 8260,000 779228 AH8 1211/04 9.50% 8280,000 779228 AJ4 12/1/05 9.50% 8310,000 779228 AKI 12/1/14 10.00% $4,600.000 779228 AU9 Zhe COSIP numbers are inducted solely for the convenience of the holden. Neither the as nor the Trustee shall be responsible far the selection or the use alike CLSIPnumbers, nor is any representation made as to their correctness on the securities. Tins Invitation is Dated: December 23, 1994 CITY OF ROUND ROCK, TEXAS INVITATION TO TENDER AND SOLICITATION FOR CONSENT Relating to: CITY OF ROUND ROCK, TEXAS Golf Course Trust Certificates, Series 1989 DATED DATE: December 1, 1989 THIS INVITATION WILL EXPIRE AT 5:00 p.m., NEW YORK CITY TIME, ON WEDNESDAY, FEBRUARY 1, 1995 UNLESS EARLIER TERMINATED OR EXTENDED The Information Agent for this Invitation is: FIDUCIARY COMMUNICATIONS COMPANY, INC. Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 Call Toll Free: 800- 365 -BOND (800- 365 -2663) Any holder wishing to tender Certificates and/or consent to die amendment pursuant to this Invitation should either follow the procedures more fully described herein or request a broker, dealer, commercial bank, trust company or other nominee to assist in effecting the transaction. See Section 6 herein, "Procedure for Tendering Certificates and Other Related Matters' and Section 11 herein, 'Amen&nent to Lease Agreement and Trust Agreement." Morgan Stanley & Co. Incorporated is serving as Dealer Manager for this Invitation. 2. General 8 A. Purchase Price; Market for Certificates B. Termination; Settlement C. Possible Restructuring 3. Acceptance of Offers 9 4. Irrevocability of Offers by Certificateholders; Withdrawal Rights 9 5. Amendments 10 6. Procedure for Tendering Certificates and Other Related Matters . 10 7. Income Tax Consequences 11 8. Additional Information 11 9. Certain Conditions of Invitation to Tender 12 10. Solicitation and Other Fees 12 11. Amendment to Lease Agreement and Trust Agreement 12 12. Miscellaneous 14 Exhibits Unaudited Financial Report of the Operator Exhibit A Form of Amendments Exhibit B Section Page 1. Background 3 A. Original Issuance of the Certificates and Structure of Financing B. History and Financial Condition of Golf Course C. Restructuring and Other Alternatives MOCK/GOLF/DOGS: TENDPJGAR612/2044 TABLE OF CONTENTS SUMMARY The jnfomu ion contained in this Summary is abject in all respects to the more complete information contained in this Invitation to Tender and Solicitation for Consent. No person is authorized to detach this Summary or any portion of this Summary or to otherwise make use of this Summary without inference to the entire brvitauon to Tender and Solicitation for Consent. Capitalized terms used in this Summery are defined terns with the meetings assigned to them in the brvitation to Tender and Solicitation for Consent. unless otimrwise noted. Proposal The City of Round Rock, Texas (the "City ") is offering holders of the outstanding Series 1989 City of Round Rock, Texas Golf Course Trust Certificates (the "Certificates ") to sell their Certificates at a price to be announced on or about January 9, 1995. This proposal is intended to ensure the economic survival of the golf course originally financed with the Certificates. The City is also seeking holder consent to an amendment to the Trust Agreement and Lease Agreement related to the golf course financing. The amendment clarifies the ability of the City to make provision for the payment of, or legally "defease," Certificates. The proposed amendment requires consent of at least 60 % of the holders of the outstanding Certificates. The City reserves the right to cancel or amend its offer to purchase outstanding Certificates at any time and for any reason. The deadline for responses to the City's proposal is 5:00 p.m. New York City time, Wednesday, February 1, 1995. History The golf course originally financed with the Certificates has produced net losses since becoming operational on October 19, 1990. A financial summary of operations of the golf course has been provided as "Exhibit A" hereto which shows cumulative net losses for the course for the period from 1/1/91 to 8/31/94 were $931,874. To date, the Operator of the golf course, under a Management Agreement which expires October 19, 1995, has funded operating shortfalls through cash contributions, essentially forestalling a payment default on the Certificates. The Operator has notified the City that it will make no further cash contributions to subsidize the golf course. To date, debt service payments has represented interest only on the Certificates. Debt service increases significantly in 1996 when principal on the Certificates on the Certificates begins to be amortized. Under the original financing documents, security for the Certificates is limited to revenues generated by the golf course and any reserve or other funds held by the Trustee on behalf of the Certificateholders. Certificateholders do not have a mortgage lien on the golf course or related real or personal property. In addition, the City is not obligated to levy taxes to support payment of principal or interest due on the Certificates. The City has no legal obligation to appropriate funds to satisfy future debt service on the Certificates should this proposal prove unsuccessful. RRoctuootptoocs: TENDFAS.Uaa tirzofs. R IDCIJDOLPNOCS: 7ffi!DPJt2.DR6 I2AO94 [THIS PAGE INTENTIONALLY LEFT BLANK] Invitation to Tender and Solicitation for Consent Relating To: City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 IMPORTANT THLS INVITATION PROVIDES YOU WITH AN OPPORTUNITY TO SELL THE GOLF COURSE TRUST CERTIFICATES (THE "CERTIFICATES ") TO THE CITY OF ROUND ROCK, TEXAS (THE "CITY "). IF YOU CHOOSE NOT TO SELL YOUR CERTIFICATES WE ARE ALSO REQUESTING YOUR CONSENT TO CERTAIN AMENDMENTS TO THE LEASE AGREEMENT AND TRUST AGREEMENT (THE "AMENDMENTS "). Any holder wishing to tender Certificates and consent to the Amendments in response to this Invitation should complete and sign the Letter of Transmittal (green form) and forward it with the Certificates to Frost National Bank, the Tender Agent, at the address set forth on the Letter of Transmittal, not later than 5:00 p.m. New York City time, Wednesday, February 1, 1995. Holders of Certificates registered in the name of a broker, dealer, bank, trust company or other nominee should contact such nominee if they desire to tender their Certificates. The City reserves the right to accept, on terms it deems desirable, or to reject any or all Certificates tendered. CAREFULLY EVALUATE THE INFORMATION CONTAINED HEREIN BEFORE TENDERING YOUR CERTIFICATES OR CONSENTING TO THE AMENDMENTS. THE CITY DOES NOT MAKE ANY RECOMMENDATIONS AS TO WHETHER A HOLDER SHOULD TENDER OR CONSENT TO THE AMENDMENTS OR REFRAIN FROM TENDERING OR CONSENTING WITH RESPECT TO ALL OR ANY CERTIFICATES. NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY SUCH RECOMMENDATION ON BEHALF OF THE CITY AND, IF MADE, ANY SUCH RECOMMENDATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE CITY. RROCX/GOIP TFNDER2.DR6 12/20 /96 (i) sell their Certificates and to consent to certain amendments to the Lease Agreement and Trust Agreement executed in connection with the Certificates (the "Amendments ") upon the terms and conditions specified in this Invitation to Tender and Solicitation for Consent and the Letter of Transmittal; or INTRODUCTION The golf course originally financed with the proceeds of the Golf Course Trust Certificates, Series 1989, identified on the cover hereof (collectively referred to as the "Certificates "), has produced net losses since becoming operational on October 19, 1990, see "History and Financial Condition of Golf Course" below. As a result, the City of Round Rock, Texas (the "City ") is considering restructuring the financing and by this invitation is offering holders the opportunity to: (ii) consent to the Amendments pursuant to a consent form (the "Consent Form ") (the Invitation to Tender and Solicitation for Consent, the Letter of Transmittal and Consent Form being collectively referred to herein as the "Invitation "). RROCKMOLP/DOCR TFNDE32.DR61240 This Invitation will expire at 5:00 p.m. New York City time on Wednesday, February 1, 1995, unless earlier terminated or extended by the City in its sole discretion. THE CITY IN ITS SOLE DISCRETION MAY TERMINATE ALL OR ANY PART OF THIS INVITATION PRIOR TO THE STATED EXPIRATION FOR ANY REASON. 1. Background A. Original Issuance of the Certificates and Structure of Financing. Introduction. The Certificates were issued by First City, Texas-Austin, N.A., (now Frost National Bank as successor trustee to First City, Texas - Austin, N.A:) (collectively, the "Trustee ") on December 20, 1989 pursuant to the terms of a trust agreement dated as of December 1, 1989 (the "Trust Agreement ") to evidence proportional interests in certain lease payments to be made by the City as rent for a public golf course pursuant to a Lease Agreement between Round Rock Golf, Inc., a State of Texas nonprofit corporation (the "Corporation ") and the City (the "Lease Agreement "). The Certificates are outstanding in the amounts and mature in the years as shown on the cover page hereof. Proceeds of the Certificates were used to (i) finance the acquisition, construction and equipment of a public golf course in the City now known as Forest Creek Golf Course (the "Golf 2 Course "), (ii) fund $1,281,131 in capitalized interest, (iii) fund a $674,000 reserve fund and (iv) pay the costs of issuing the Certificates. The original financing structure is set forth in the Official Statement dated November 22, 1989 which was prepared and distributed in connection with the original issuance of the Certificates. Copies of the original financing documents together with the Official Statement dated November 22, 1989 can be obtained, at no charge, from the Information Agent at 800- 365 -BOND (800 - 365- 2663). Summary of Original Transaction. To briefly summarize the original transaction, the City was deeded certain property pursuant to a Land Use Agreement for Golf Course Tract, dated September 28, 1989 by and between the City and Franklin Capital Corporation (the "Use Agreement "), which provides, among other things, that the property must be used exclusively as a public golf course. To facilitate the financing, acquisition and construction of the golf course, the City leased the real property upon which the improvements were to be located, to the Corporation pursuant to a ground lease and then leased back the property together with any improvements pursuant to the Lease Agreement. Under the terms of the Lease Agreement, City lease payments are payable, subject to annual appropriation, from lawfully available revenues including payments by the Operator, as defined below, of the Golf Course pursuant to the terms of a management agreement dated December 1, 1989 (the "Management Agreement "). The Corporation and the City assigned certain rights under the Lease Agreement, including the right of the Corporation to receive lease payments, to the Trustee pursuant to the Trust Agreement by and among the City, the Corporation and the Trustee. CCA Silband /GolfCorp /Round Rock Inc. (the "Operator "), a single purpose wholly owned subsidiary of CCA Silband/Golf Corp, has operated and managed the Golf Course since it became operational in October, 1990. Pursuant to the terms of the Management Agreement, which expires October 19, 1995 unless an extension is agreed to by the City and the Operator, the Operator is obligated to make payments only from revenues of the Golf Course. However, the Operator has made numerous cash contributions to subsidize operation and maintenance expenses in order to cover the Golf Course revenue shortfalls. See "History and Financial Condition of Golf Course" below. Appropriation Process. Pursuant to the terms of the Lease Agreement and Trust Agreement, the City makes an annual determination prior to the beginning of each fiscal year, which commences October 1, whether to make provision for the payment of Lease Payments during such fiscal year. This annual process is sometimes referred to herein as an "appropriation. " The City has no legal obligation to annually appropriate an amount sufficient to pay the Lease Payments due in any year. No Mortgage and Restricted Use. The Certificates are not secured by a mortgage on the Golf Course. In addition, the Use Agreement, which governs the Lease Agreement and Trust Agreement, restricts the use of the property exclusively as a golf course. RROCIUGO P /ROCS: TEJIDEN3.DA6 12/70194 3 B. History and Financial Condition of Golf Course. Insufficient Revenues. Certain projections and assumptions regarding forecasted net revenues relied upon at the time the Certificates were issued have not been realized and therefore the Golf Course has not produced sufficient revenues, since the Golf Course became operational on October 19, 1990, to cover: (i) the debt service payments on the Certificates; (ii) the management fee of the Operator pursuant to the Management Agreement; and (iii) the operation and maintenance expenses of the Golf Course. Operator Payments and Management Agreement. The Golf Course, however, has remained operational and lease payments have been made timely due to cash contributions by the Operator and the deferment of payment of part of the management fee owed to the Operator. This arrangement has allowed all payments of debt service on the Certificates to be made, thus far. The Operator, however, has informed the City that it does not intend to fund additional moneys to supplement Golf Course revenues and, since the Operator is not receiving management fees, has also indicated that they would not be inclined to continue to operate the Golf Course under the current financing structure. Under the Management Agreement, the Operator is entitled to (i) $12,000 per month, (ii) 2% of the gross revenues of the Golf Course for the prior month and (iii) an amount equal to the Operator's employees salaries, out -of- pocket expenses and related expenses. According to the Operator, as of October 30, 1994, the earned but unpaid and accrued management fees equal $684,084. The Management Agreement between the City and the Operator terminates October 19, 1995 and discussions are currently underway regarding extending the term of such agreement. No assurances can be given, however, regarding the continued involvement of the Operator with the Golf Course. Financial Statements. Pursuant to the Management Agreement, the Operator is not required to provide audited financial statements for the Golf Course and no audited financial statements currently exist. Attached hereto as Exhibit "A" is the unaudited report of the Operator for the fiscal years 1991, 1992 and 1993 and for the 8 month period ending August 31, 1994 as prepared by the Operator. Copies of the monthly reports which comprise the unaudited condensed statement of operations may be obtained from the Operator at (214) 888- 7766, 3030 LBJ Freeway, Suite 350, Dallas, Texas 75234, Attention: Mike Ussery. Based upon information provided by the Operator, and for purposes of illustration only, below are graphs which compare revenue and net income for the years 1991, 1992 and 1993 and the eight months ended August 31, 1994 as well as the existing debt service on the Certificates. However, no assurances can be given regarding future revenues or income of the Golf Course. RROCK/GOIP/DOCS: T NDCR3.DR6 1220/94 4 Existing Debt Service Exceeds Historical Cash Generated* $ Thousands 1000 900 800 700 600 500 400 300 200 Debt Service Comparison Round Rock Golf Course 100 D ebt Service rola. Interest only before 1004. net of capiw:ed payments. • Revalue saes =palm. before debt Benito ( 1991415 =IA: 1994-2014represrts CtN9m'ene prpjecdtn based on aria' 3year average). Routded toe 9rapa4en purposes only. RROCK/OOLF /DOGS: TFNDER2.DR6 1 2120/94 5 1500 1400 1300 1200 1100 1000 900 800 700 600 500 400 300 200 100 0 -100 -200 -300 -400 Operating Performance* $ Thousands 1991 1992 1984 data is 010 ew,pb efdt/94. 1993 Reserve Fund. A portion of the proceeds of the Certificates have been used to establish a reserve for the payment of debt service on the Certificates. As of September 30, 1994, the Reserve Fund contained $732,856.89 which is comprised of the reserve requirement of $674,000 plus interest earnings. The application by the Trustee of the money held within the Reserve Fund is governed by the Trust Agreement which grants the Trustee certain rights and duties in administering the trust. In particular, Section 9.03 of the Trust Agreement provides: [u]pon an Event of Default, but only upon an Event of Default, the Trustee shall have a first lien with right of payment prior to payment on account of principal, premium, if any, and interest due with respect to any Certificate upon the amounts held hereunder for the foregoing fees, charges and expenses incurred by it. 1994 • Includes D.et Unioe ovens. No City Funds Involved. The financing structure utilized. in connection with the sale of the Certificates evidences the City's financing requirement that the Golf Course be a self - supporting project that is not dependent upon any tax or other revenues of the City. To date, Lease Payments have been made from Golf Course revenues, Operator contributions, certain investment income from the Reserve Fund and capitalized interest. THE CITY HAS NEVER USED MONEYS FROM ITS GENERAL FUND TO SUPPORT LEASE PAYMENTS AND DOES NOT CURRENTLY ANTICIPATE APPLYING ANY OF THE CITY'S GENERAL REVENUES TO MAKE ANY LEASE PAYMENTS ON THE GOLF COURSE. Based solely upon the availability of a combination of Golf Course revenues together with Operator payments and investment income from the reserve fund, the City has made provision to pay lease payments due in January 1, 1995 through September 30, 1995. However, no assurances can be made that the City will make provision for the payment of lease payments for any fiscal year subsequent to September 30, 1995. The City is under no legal obligation to pay lease payments for subsequent fiscal years. THE CERTIFICATES DO NOT CONSTITUTE: • DEBT OF THE CITY • THE STATE OF TEXAS, • ANY POLITICAL SUBDIVISION OF THE STATE WITHIN THE MEANING OF THE CONSTITUTION OF THE STATE OF TEXAS; OR • A PLEDGE OF THE FAITH AND CREDIT OF THE CITY. C. Restructuring and Other Alternatives. This Invitation is part of a refinancing/restructuring plan the City is considering in order to cure the cashflow deficits of the Golf Course. Historical revenues and expenses of the Golf Course indicate that if less than 85% of the Certificates are tendered, the future economic viability of the Golf Course will be jeopardized. THE CITY BELIEVES THAT THE CONTINUED OPERATION AND SUCCESS OF THE GOLF COURSE IS DEPENDENT ON THE RELATIVE SUCCESS OF THIS INVITATION. If the tender is successful, the City anticipates (i) issuing new debt, (ii) using certain lawfully available funds on hand or (iii) a combination of (i) and (ii), to effectuate the payment of the purchase price for all Certificates tendered and, if necessary, to provide for the payment of any Certificates not tendered (i.e., defeasance until maturity or the first available redemption date of December 1, 1998). See Section 11 of this Invitation, "Amendment to Lease Agreement and Trust Agreement." If the tender offer is not successful, it is uncertain what course of action the City may take. The City may not take any action or may decide, beginning October 1, 1995, to terminate the Lease Agreement by not paying lease payments (Le., nonappropriation) in future fiscal years. Both such options may result in insufficient Golf Course revenues to pay the principal of and interest on the Certificates. Additionally, if the City elects to nonappropriate and terminates the Lease Agreement and annual Golf Course revenues are insufficient to pay principal of and interest on the Certificates, the Golf Course cannot be put to use as anything other than a Golf Course by the Trustee. The Certificates are not secured by a mortgage on the Golf Course. Failure to comply with certain provisions of the Use Agreement may result in the City's loss of ownership of the Golf Course and in such event there would be no source of revenues to repay the Certificates. Additionally, the City does not currently have the personnel or experience to manage the Golf Course'and if (i) the Operator does not continue operating the RROCK/GOIFIDOM TPNOPN2.OR612/20 /94 6 Golf Course and (ii) the City does not appropriate lease payments for future fiscal years, the ability of the Golf Course to generate sufficient revenues to pay the principal of and interest on the Certificates may also be jeopardized. 2. General. A. Purchase Price; Market for Certificates. The purchase price for the Certificates will be established on or about the week of January 9, 1995 and will be made available by mailing (via first -class mail) to the registered holders, through the Munifacts Wire System, Bloomberg News Service, Dow Jones News System and the Information Agent. The purchase price will also be posted in Redemption Digest and Securities Industry Daily. First Southwest Company, will assist the City in determining a purchase price for the Certificates. The Certificates are not listed on any securities exchange nor actively traded. It is recommended that holders consult their brokers or financial advisors for information concerning the liquidity of, and the prices which may be obtainable for, their Certificates. Any purchases of Certificates by the City pursuant to this Invitation will reduce the amount of Certificates available to trade publicly which could materially affect the liquidity and market value of the Certificates remaining outstanding. B. Termination; Settlement. THE CITY RESERVES THE RIGHT, IN ITS SOLE DISCRETION, TO TERMINATE THIS INVITATION, IN WHOLE OR IN PART, PRIOR TO THE EXPIRATION DATE. If the City terminates the Invitation in whole or in part prior to Wednesday, February 1, 1995, the City will give notice of such termination by disseminating such information through the means described in Section 2A above. In such event, the City will not be required to accept for payment or pay for any affected registered Certificates which have been tendered previously and all such Certificates shall be returned to the holders thereof. In addition, the City reserves the right to reject any and all Letters of Transmittal for Certificates tendered. The City further reserves the right to waive any irregularities in any and all of the Letters of Transmittal or Consent Forms, and to accept or reject any and all Letters of Transmittal or Consent Forms received after the above stated deadlines for receipt of such documents. The City expects that the date of purchase of Certificates tendered (the "Settlement Date ") will be on or about April 19, 1995. The City's obligation to purchase and pay for Certificates validly tendered is subject to the sole discretion of the City. The City is not obligated to accept any offers made. Payment by the City on the Settlement Date will be made in immediately available funds by deposit of the purchase price of the Certificates accepted for payment plus, in each case, RROCR/OOIP/DOC3: TENDER2•DR6 12/20;94 7 interest accrued to the Settlement Date, with Frost National Bank in Houston, Texas (the "Tender Agent "). Accrued interest will only include interest earned on the Certificates from the date interest was last paid through the day immediately prior to the Settlement Date. The Tender Agent will act as agent for the tendering holders of the Certificates for the purpose of receiving payment from the City and transmitting payment to the tendering holders of the Certificates. After payment by the City to the Tender Agent, the tendering holders of the Certificates will not be entitled to receive interest on such Certificates. Payment by the Tender Agent will be made by check payable to the tendering holders of the Certificates promptly after the Settlement Date at the addresses specified by them in their Letters of Transmittal. 3. Acceptance of Offers. The City is not obligated to purchase any minimum or maximum amount of Certificates. Acceptance by the City of offers to tender and sell Certificates pursuant to this Invitation shall constitute an irrevocable agreement between the offering holder and the City subject to all terms and conditions expressed in this Invitation. Such acceptance shall be made on or about February 10, 1995 by disseminating such information through the Bloomberg News Service, Securities Industry Daily, Munifacts Wire System, Dow Jones News System and notification to the Tender Agent, which shall be instructed to notify the registered holders of such acceptance. All questions as to the validity, form, eligibility and acceptance of any offers will be determined by the City, in its sole and absolute discretion, which determination shall be final and binding. The City reserves the absolute right to reject any and all offers which it determines do not comply with the terms of this Invitation. The City further reserves the right to waive any irregularities in any and all of the offers. None of the City, the Tender Agent or Morgan Stanley & Co. Incorporated, as Dealer Manager (the "Dealer Manager ") shall be obligated to give notice of any defects or irregularities in offers, nor shall either of them incur any liability for failure to give such notice. 4. Irrevocability of Offers by Holders. All offers by holders to sell their Certificates, once transmitted to the Tender Agent, are irrevocable. Any Certificate tendered by a holder pursuant to this Invitation and not purchased by May 2, 1995 shall be returned to the tendering holder by the Tender Agent and shall no longer be subject to the terms of this Invitation. No assurance can be given by the City that the purchase of Certificates contemplated hereby will be consummated. None of the Tender Agent, the City or the Dealer Manager shall have any duty or responsibility to any holder of any outstanding Certificate or any other party in connection with this Invitation other than as expressly set forth herein. RROGXAOLF DOC4 TFNDFA2.DRe 12/20/1 8 5. Amendments to Invitation. The City reserves the right in its sole discretion at any time prior to acceptance of any offers to tender to terminate, amend and/or withdraw the Invitation without liability to any person. 6. Procedure for Tendering Certificates and Other Related Matters. A. Procedure for Certificates held in Physical Certificate Form. For a holder to effectively tender Certificates pursuant to this Invitation, the Certificates, a properly completed and duly executed Letter of Transmittal (or a facsimile thereof) for the Certificates being tendered, and any other documents required by such Letter of Transmittal must be received by the Tender Agent prior to the Expiration Date. B. Procedure for Certificates held by Brokers, Dealers or Banks in "Street Name." The Tender Agent will establish an account with respect to the Certificates at The Depository Trust Company, for purposes of this Invitation, within two business days after the date of this Invitation. Any financial institution that is a participant in The Depository Trust Company may make book -entry delivery of Certificates by causing The Depository Trust Company to transfer such Certificates into the Tender Agent's account, in accordance with The Depository Trust Company's Automated Tender Offer Program (ATOP). BENEFICIAL OWNERS OF CERTIFICATES REGISTERED IN THE NAME OF A BROKER, DEALER, BANK, TRUST COMPANY OR OTHER NOMINEE OR HELD THROUGH A BOOK -ENTRY TRANSFER FACILITY, SHOULD NOT USE THE LETTERS OF TRANSMITTAL. SUCH BENEFICIAL OWNERS SHOULD CONTACT THEIR BROKER, DEALER, BANK OR OTHER NOMINEE TO ARRANGE THE TENDER OF THEIR CERTIFICATES. C. General Provisions. Each tender of Certificates must be for the entire Certificate or an integral multiple of $5,000 thereof. A copy of the Letter of Transmittal accompanies this Invitation. Additional copies of the Letter of Transmittal may be obtained by calling the Information Agent at the telephone number given on the cover page. The method of delivery of Certificates and other documents is at the election and risk of the tendering holder. It is recommended pat Certificates be delivered by Express Mail, Federal RROCK/GOU' /DO( : TENDER2.DR6 12/20/94 9 Express or other similar courier service, properly insured, in sufficient time to permit receipt by the Tender Agent prior to the Expiration Date. It is also recommended the holder maintain the shipping receipt. For assistance regarding method of delivery of the Certificates, call James Rankin with the Tender Agent at (713) 651 -5018. 7. Income Tax Consequences. The federal income tax consequences of a sale pursuant to this Invitation may vary depending upon, among other things, the particular circumstances of the holder. A sale by a holder pursuant to this Invitation, however, will be a transaction in which gain or Toss may be recognized for Federal Income tax purposes. In the case of a taxpayer who holds a Certificate as a capital asset (other than a bank and certain other financial institutions), any such gain or loss will be characterized as capital gain or loss. Whether capital gain is long -term or short-term will depend on whether such Certificate was held by the taxpayer for more than one year. If the purchase price (exclusive of accrued interest) paid to a holder for a Certificate exceeds or is Tess than the holder's adjusted basis for such certificate, such holder will recognize capital gain or loss to the extent of the difference. For this purpose, if the holder purchased the Certificate at a premium or discount, then the holder may be required to adjust such basis in the Certificate by an amount representing amortization of such premium or discount as required by the Code. Federal income tax law requires the Tender Agent to notify the Internal Revenue Service (the "IRS") of certain sales of Certificates. As such, the amount of any sale made pursuant to this Invitation will be reported on a Form 1099 -B furnished to the holder and the Internal Revenue Service. Amounts paid to a holder tendering a Certificate for purchase may be subject to a backup withholding tax at a rate of 31% by reason of the events specified by Section 3406 of the Code and regulations thereunder. These events include failure of a holder to supply the Tender Agent with the holder's correct taxpayer identification number or social security number certified under penalties of perjury. Certification may be made on the enclosed Letter of Transmittal. This Federal income tax discussion only is included for general informational purposes and does not purport to deal with all aspects of Federal income taxation that may be relevant to any particular holder. The City and the Tender Agent do not undertake to render any advice on the tax consequences to any particular holder, and holders are advised to consult their tax advisers as to the particular Federal, state or local tax consequences of sales made by them pursuant to this Invitation. 8. Additional Information. You may obtain additional information relating to the above by contacting Fiduciary Communications Company toll -free at 800 -365 -BOND (800- 365- 2663). You may also choose to contact your broker, dealer or other financial advisor for more information. RROCK:GOIF/00MR TENDERI.DR612/20N4 l0 9. Certain Conditions of Invitation to Tender. The City is not obligated to accept any offers made pursuant to this Invitation. The City's obligation to purchase and pay for Certificates tendered is subject to the sole discretion of the City, including certain conditions such as ability to issue new debt to effectuate the tender. 10. Solicitation and Other Fees. The City will pay to any broker, dealer, bank, trust company or other nominee, including the Dealer Manager, the name of which appears in the appropriate space in the Letter of Transmittal, a solicitation fee of $15 per $5,000 principal amount of any Certificates (i) covered by a Letter of Transmittal and purchased pursuant to this Invitation or (ii) covered by a Consent Form. No broker, dealer, commercial bank, trust company or fiduciary shall be deemed to be the agent of the City, the Tender Agent, the Information Agent or the Dealer Manager for purposes of this Invitation. The City has retained Morgan Stanley & Co. Incorporated to act as Dealer Manager in connection with this Invitation. The City has agreed to pay the Dealer Manager a fee of $15 per $5,000 based upon the principal amount of Certificates purchased pursuant to this Invitation and will reimburse the Dealer Manager for certain out -of- pocket expenses. Morgan Stanley & Co. Incorporated will also act as lead underwriter of the issuance of the new debt to effectuate the tender. The Tender Agent will receive reasonable and customary compensation for its services and will be reimbursed for certain out -of- pocket expenses. 11. Amendment to Lease Agreement and Trust Agreement. (a) Tender Deemed Consent to Amendments. As a part of this Invitation, the City is soliciting the consent from each of the registered holders to the Amendments. The holders of sixty percent (60 %) of the aggregate principal amount of outstanding Certificates must consent to the Amendments before the Amendments can become effective. HOLDERS TENDERING CERTIFICATES PURSUANT TO THE PROVISIONS OF THIS TENDER WILL BE DEEMED TO HAVE CONSENTED TO THE AMENDMENTS TO THE LEASE AGREEMENT AND TRUST AGREEMENT AS SET OUT IN THE PROPOSED RESOLUTION SO LONG AS THE CITY BUYS SUCH CERTIFICATES. (b) Background and Purpose of Amendments. If the City proceeds with any refinancing/restructuring of the Certificates, the City may determine that it is necessary to make provision for the payment of, or legally "defease," any Certificates not tendered for purchase, particularly if the reserve fund established in connection with the Certificates is used as a cash contribution for the refinancing /restructuring. RROCIUOOIP/DOCS: 184DE 2.OR6 13$20/N 11 Pursuant to Texas law and the Amendments, a defeasance of outstanding Certificates can be effectuated only upon the deposit in escrow of cash and/or United States Treasury obligations which mature in an amount sufficient to pay the principal of and interest on the Certificates at maturity or early redemption. HOLDERS ARE ADVISED TO CAREFULLY REVIEW THIS INVITATION AND THE PROPOSED RESOLUTION WHICH CONTAINS THE AMENDMENTS TO THE LEASE AGREEMENT AND TRUST AGREEMENT (ATTACHED AS "EXHIBIT B "). (c) Procedure for Consent. Any holder who does not wish to tender Certificates but who concurs with the Amendments should execute, date and return the enclosed pink Consent Form in accordance with the instructions set forth therein and shall mail or deliver such Consent Form and any other required documentation to City of Round Rock, Texas, c/o Frost National Bank, as Tender Agent, by mail, P.O. Box 3856, Houston, Texas 77253 or by express courier or hand, 1301 Fannin, Suite 2215 Houston, Texas 77002 or by facsimile transmission (713) 651- 5015 so that it is received on or before the Expiration Date. Only a registered holder (or its legally authorized representative) may execute the Consent Form. Any beneficial owner of a Certificate who is not the registered holder of such Certificate (e.g. a beneficial owner with Certificates registered in the name of a securities depository such as The Depository Trust Company) must arrange with the registered holder to execute and deliver the Consent Form on its behalf. THE CONSENT FORM SHOULD BE SIGNED AND RETURNED IN THE ENCLOSED PREADDRESSED ENVELOPE. NO CONSENT SHOULD BE SENT TO ANY PERSON OTHER THAN THE TENDER AGENT. Delivery will be effective only upon actual receipt by the Tender Agent. Consent Forms may also be delivered by hand to the Tender Agent at its address set forth above. Holders may also request their respective brokers, dealers, commercial banks, trust companies or nominees to effect delivery on behalf of such holder. The holder may confirm that the Consent Form has been received by the Tender Agent by calling James Rankin at (713) 651 -5018, between the hours of 9:00 a.m. and 4:30 p.m., Central Standard Time. If a Consent Form relates to less than all of the Certificates registered in the name of the holder providing the Consent Form, the holder must indicate by certificate number the principal amount of Certificates to which the Consent Form relates. Otherwise, the Consent Form will be deemed to be related to all of the Certificates registered in the name of the holder. Proof of execution of a Consent Form shall be determined in accordance with such reasonable rules as the City may prescribe. The ownership of Certificates shall be proved by the registration books maintained by the Trustee. The City may require as much additional proof of execution or ownership as it deems necessary. All questions as to the validity, form, eligibility (including time of receipt) and acceptance of consents will be resolved by the City. The City RROCKICO1F /OOC9: TFNDE112.DR612/20/M 12 reserves the absolute right to reject any or all Consent Forms that are not in proper form or the acceptance of which could, in the opinion of the City's counsel, be unlawful. The City also reserves the right to waive any irregularities or conditions of delivery as to particular Consent Forms. The City's interpretation of the terms and conditions of this solicitation shall be binding. Unless waived, any irregularity in connection with delivery of a Consent Form must be resolved within such reasonable time as the City determines. The City shall be under no duty to give notification of any irregularity or waiver. Delivery of a Consent with one or more irregularities will not be deemed to have been made until the irregularities have been resolved or waived. ONCE GIVEN, CONSENT MAY NOT BE REVOKED PRIOR TO THE DATE CERTIFICATES ARE PURCHASED IRRESPECTIVE OF THE SALE OR TRANSFER OF THE CERTIFICATES. 12. Miscellaneous. This Invitation is not being made to, nor will the City accept tenders from, holders of Certificates in any jurisdiction in which the Invitation or the acceptance thereof would not be in compliance with the laws of such jurisdiction. In those jurisdictions whose laws require the Invitation to be made through a licensed broker or dealer, this Invitation is being made on behalf of the City by the Dealer Manager. No person has been authorized to make any recommendation on behalf of the City as to whether a holder should tender Certificates or consent to the amendments pursuant to the Invitation. No person has been authorized to give any information or to make any representation in connection with the Invitation other than contained herein or in the Letters of Transmittal and the Consent Form. If given or made, such recommendation and such information and representation must not be relied upon as having been authorized by the City. The City makes no recommendation to any holder as to whether to tender or to refrain from tendering such holder's Certificates or to consent to certain amendments pursuant to the Invitation. Each holder must make the decision to consent or to tender Certificates and, if the decision is made how many Certificates to tender. Holders are urged to review carefully the information contained herein in reaching a decision. The City reserves the right to effect transactions in the Certificates other than pursuant to this Invitation during the tender period. The City reserves the right at any time and from time to time, after the expiration or termination of the tender period, to purchase Certificates at such prices and upon such terms and conditions as it shall deem appropriate. RROCK/GO1FIDOCS TENDFR2.13R612/20 13 CITY OF ROUND ROCK, TEXAS Duly executed photocopies or facsimiles of any notice given in connection with this Invitation will be accepted. All such communications to be sent or delivered to the Tender Agent should be delivered at the appropriate address or facsimile number set forth below. By Hand or Express Courier: Frost National Bank Corporate Trust Department Attention: James Rankin 1301 Fannin, Suite 2215 Houston, Texas 77002 RRDCKIGOLPIDOCS TENDERLDR612f20/94 The Tender Agent for this Invitation: FROST NATIONAL BANK Facsimile Number: (713) 651 -5015 For Assistant, Please Contact: James Rankin (713) 651 -5018 The Information Agent for this Invitation is: The Dealer Manager for this Invitation is: Morgan Stanley & Co. Incorporated 1221 Avenue of the Americas New York, New York 10020 By Mail: Frost National Bank Corporate Trust Department Attention: James Rankin P.O. Box 3856 Houston, Texas 77253 Holders should contact their broker, dealer, financial advisor, commercial bank or trust company for assistance concerning this Invitation. For copies of this Invitation or for any questions regarding this Invitation, telephone Fiduciary Communications Company at the telephone number listed below. FIDUCIARY COMMUNICATIONS COMPANY Attention: Richard Jacovitz 149 Franklin Street, 2nd Floor New York, New York 10013 , Call Toll Free: 800- 365 -BOND (800- 365 -2663) RROCX/CAIP/DOCS 1ThDRR1.DR612/20/94 EXHIBIT A Unaudited Balance Sheet, Unaudited Condensed Statement of Operations and Unaudited Other Selected Financial Information for Fiscal Years Ended December 31, 1991 through December 31, 1993 and eight months ended August 31, 1994 November 17, 1994 Mr. David Kautz Director of Finance City of Round Rock 221 E. Main Street Round Rock, TX 78664 Dear Mr. Kautz: The monthly financial statements for Forest Creek Golf Club have been prepared by GolfCorp in accordance with Generally Accepted Accounting Principals (GAAP). Sincerely, ack Lupton Chief Financial Officer GolfCorp GOLFCORP RHO I_nl FREEWAY • SI 111 I. 150 • 1.1149 • I)AI.I.AS, I'IiXA5 751. {-I .:147Haa -77M • FAX :I •Vnnn. Assets Cash 92,427 Inventory 32,109 Accounts Receivable 37,945 Prepaid Expenses 126,051 Total Current Assets 288,532 Other Assets 19,844 Property, Plant & Equipment 289,808 less: Accumulated Depreciation (103,310) Net Property, Plant & Equipment 186,498 Total Assets 494,874 Liabilities Accounts Payable - Trade 78,044 Accounts Payable - Affiliate 1.288,187 Short Term Notes Payable 61,911 Current Accruals 76,459 Other Current Liabilities 223 Total Liabilities 1,504,824 Owner's Equity Retained Earnings (Deficit) Net Income (Loss) Current Year Total Owner's Equity GOLFCORP Round Rock Golf, Inc Forest Creek Golf Club Unaudited Balance sheet as of August 31, 1994 Total Liabilities and Owner's Equity 494,874 (903,246) (106,704) (1,009,950) 1010 I.IIJ i I(I I WAY • SUITE ISO • 1.114 • I )AI.I.AS, - I PXAS 7521.1 _' 1.IInHH.17M FAX 214/MHH.777I GOLFCORP Round Rock Golf, Inc Forest Creek Golf Club U naudited Condensed Statement of Operations Fiscal Year Ended December 31 (1) Lease Expense represents interest cost on the Trust Certificates. 8 months 1991 1992 1993 as of 8/31194 Operating Revenue Golf Fees 475,407 622,121 580,422 491,274 Cart Fees _230,712 319,838 322,092 296,266 Food & Beverage Sales 119,769 162,934 143,648 131,202 Merchandise & Other 120,607 155,695 143,671 114,396 Total Operating Revenue 946,495 1,260,588 1,189,833 1,033,138 Operating Expenses Salaries /Commissions /Benefits 257,692 273,133 295,269 207,913 Management Fees 223,986 127,424 167,661 116,723 Cost of Goods Sold 113,392 168,675 146,941 119,430 Lease Expense - Golf Course (1) 293,969 376,908 528,719 438,618 Rental & Equipment Lease Expense 66,710 69,451 80,807 39,273 Grounds Maintenance 68,311 74,024 (38,415) 39,481 Other Operating & Amortization 7 Expenses sn 187,584 308,242 314,728 169,660 Other Operating Expense Total Operating Expenses 1,248,962 1,436,361 1,536,761 1,139,842 Net Income (Loss) (302,467) (175,773) (346,928) (106,704) Sdte 1.141 rI&J EWAY • sum: 150 • LIS .1'1 • I1AI.I.AS. ITAAS 75214 214 /MM8.7764 • FAX 21I /MMM -777 GOLFCORP Round Rock Golf, Inc Forest Creek Golf Club Unaudited Other Selected Financial Information Fiscal Year Ended December 31 8 months 1991 1992 1993 as of 813119 Total Rounds 33,122 44,295 42,388 33,397 Average Green Fee per Round 14.35 14.04 13.69 14.71 Average Cart Fee per Round 6.97 7.22 7.60 8.87 '•r PPP LISP FRII(WAY • .I I11Y 110 • I.II4'+ • 1 PAI.I..\', TEXAS 752 14 2I.Ih1.v 77' • FAX I- 1!mHM•777f KAOCKAOLP/D0C% Tffi+uv3.1294 12/20/91 EXHIBIT B FORM OF RESOLUTION RESOLUTION APPROVING FIRST SUPPLEMENTAL TRUST AGREEMENT AND FIRST SUPPLEMENTAL LEASE AGREEMENT WHEREAS, the City of Round Rock, Texas (the "City") has previously executed a "Golf Course Construction and LeacP/Purchase Agreement" dated as of December 1, 1989 (the "Lease ") between the City, as lessee and Round Rock Golf, Inc., as lessor in connection with the acquisition, construction and financing of a public golf course; and WHEREAS, in furtherance of the acquisition, construction and financing of the golf course, a Trust Agreement dated as of December 1, 1989 by and among the City of Round Rock, Texas, First City, Texas - Austin N.A., as Trustee and Round Rock Golf, Inc. (the "Trust Agreement ") was executed in connection with the issuance of $6,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates "); and WHEREAS, the City deems it advisable and necessary to amend the Lease and Trust Agreement to clarify the City's ability to provide for the prepayment of lease payments under the I Pa se and therefore releasing and defeasing its obligations under the Lease, Trust Agreement and Certificates; and WHEREAS, pursuant to Section 15.4 of the Lease, the Lease can be modified by written amendment of the lessee and the lessor as provided in the Trust Agreement; and WHEREAS, pursuant to Article X of the Trust Agreement, the Trust Agreement can be modified or amended at any time by a supplemental agreement executed by the City and the lessor which amendment shall become effective when the written consents of the owners of 60% in aggregate principal amount of the Certificates outstanding shall be filed with the Trustee; and WHEREAS, the lessor and lessee will be soliciting the consent to the First Supplemental Trust Agreement and First Supplemental Lease Agreement by 60% of the owners of the Certificates as required by Article X of the Trust Agreement; and WHEREAS, the Trust Agreement and Lease shall be deemed modified and amended by the First Supplemental Trust Agreement dated as of December 1, 1994 and the First Supplemental 1 ease Agreement dated as of December 1, 1994, respectively, in substantially the form attached hereto as Exhibit "A "; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ROUND ROCK, TEXAS: RROCICX,O1J': WYPIn4 Rr.. I2N144 B -1 Section 1. Recitals and Approval of Supplemental Agreements. The recitals set forth in the preamble hereof are incorporated by reference herein and shall have the same force and effect as if set forth in this Section. The City hereby approves the First Supplemental Trust Agreement and First Supplemental Lease Agreement in substantially the form attached hereto as Exhibit "A" and the Mayor or City Manager are hereby authorized to execute the agreements and the City Secretary is hereby authorized to attest such agreements. Section 2. Further Procedures. The Mayor or City Manager, City Secretary, the Director of Finance and all other officers, employees and agents of the City, including the City's Financial Advisor and attorneys, and each of them, shall be and they are hereby expressly authorized, empowered and directed from time to time and at any time to do and perform all such acts and things to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the City all instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Resolution, the First Supplemental Trust Agreement and First Supplemental Lease Agreement, the amendment of such agreements and other matters in connection therewith. Section 3. Full Force and Effect. Except as expressly amended and modified as set forth in Exhibit "A" attached hereto, all terms and provisions of the Lease and the Trust Agreement, respectively shall remain in full force and effect and the City hereby ratifies, confirms and adopts the Lease and Trust Agreement as amended and modified by the First Supplemental Trust Agreement and First Supplemental Lease Agreement. RRO(:IIRNIIJ^ h91RRIJA1.R1912 /01)94 B -2 FIRST SUPPLEMENTAL TRUST AGREEMENT This First Supplemental Trust Agreement ("First Supplement ") dated as of December 1, 1994 is entered into by and among the City of Round Rock, Texas (the "City "), Frost National Bank, as Trustee (as successor trustee to First City, Texas- Austin, N.A.) (the "Trustee ") and Round Rock Golf, Inc. (the "Corporation "). WITNESSETH: WHEREAS, the Trustee, the Corporation and the City have previously executed a "Trust Agreement" dated as of December 1, 1989 (the "Trust Agreement ") in connection with the issuance by the Trustee of 56,740,000 City of Round Rock, Texas Golf Course Trust Certificates, Series 1989 (the "Certificates ") evidencing proportional interests in certain lease payments made by the City under the Lease Agreement dated as of December 1, 1989 between the City and the Corporation; and WHEREAS, the City and the Corporation deem it advisable and necessary to amend the Trust Agreement pursuant to the provisions of Article X thereof to clarify the ability to provide for the payment or prepayment of the Certificates and Lease Payments and therefore releasing and defeasing the obligations of the City and the Corporation under the Trust Agreement and Lease NOW, THEREFORE, the parties hereto agree as follows: 1. Section 14.01 of the Trust Agreement is deleted in its entirety and is hereby amended to read in its entirety as follows: Section 14.01. DEFEASANCE OF CERTIFICATES AND LEASE PAYMENTS. (a) Any Certificate and the interest thereon and Lease Payments shall be deemed to be paid, retired, and no longer outstanding (a " Defeased Obligation ") within the meaning of this Trust Agreement and the Lease Agreement, respectively, except to the extent provided in subsection (d) of this Section 14.01, when payment of the principal of such Certificate, plus interest thereon to the due date (whether such due date be by reason of maturity, upon redemption, or otherwise) and premium, if any, and the I easy Payment either (i) shall have been made or caused to be made in accordance with the terms thereof (including the giving of any required notice of redemption), or (ii) shall have been provided for on or before such due date by 'irrevocably depositing with or making available to the Trustee for such payment (1) lawful money of the United States of America sufficient to make such payment, (2) Government Obligations which mature as -to principal and interest in such amounts and at such times as will ensure the availability, without reinvestment, of sufficient money to provide for such payment and when proper arrangements have been made with the Trustee for the payment of its services until all Defeased Obligations shall have become due and payable or (3) a combination of (1) and (2). At such time as a Certificate shall be deemed to be a Defeased Obligation hereunder, as aforesaid, such Certificate and the interest thereon and the Lease Payments shall no longer be secured by, payable from, or entitled to the benefits of, the Trust Agre and Lease Agreement, as provided herein, and B -3 such principal and interest shall be payable solely from such money or Government Obligations. (b) Any moneys so deposited with the Trustee may at the written direction of the City also be invested in Government Obligations, maturing in the amounts and times as hereinbefore set forth, and all income from such Government Obligations received by the Trustee which is not required for the payment of the Certificates and interest thereon with respect to which such money has been so deposited, shall be turned over to the City, or deposited as directed in writing by the City. (c) The term "Government Obligations" as used in this Section, shall mean direct non - callable obligations of the United States of America, including, obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, which may be United States Treasury obligations such as its State and Local Government Series, which may be in book -entry form. (d) Until all Defeased Obligations shall have become due and payable, the Trustee shall perform the services of Trustee and paying agent/registrar for such Defeased Obligations the same as if they had not been defeased, and the City shall make proper arrangements to provide and pay for such services as required by this Trust Agreement. In the event of a deposit set forth in (a)(ii) of this Section, the Certificates shall continue to represent direct and proportionate interests of the owners thereof in I PACP. Payments under the Lease. 2. Except as expressly amended and modified hereby, all terms and provisions of the Lease shall remain in full force and effect, and the Lessor and Lessee hereby ratify, confirm and adopt the Lease as amended and modified hereby. B -4 IN WITNESS WHEREOF, the parties hereto have caused this First Supplement to be duly executed by their respective authorized officers as of the day and year first above written and effective upon the receipt of the necessary consents. ATTEST: By: City Secretary ATTEST: By: Title: ATTEST: By: Title: CITY OF ROUND ROCK, TEXAS By: Title: ROUND ROCK GOLF, INC. By: Title: FROST NATIONAL BANK, AS TRUSTEE By: Title: B -5 FIRST SUPPLEMENTAL GOLF COURSE CONSTRUCTION AND LEASE/PURCHASE AGREEMENT This First Supplemental Golf Course Construction and Lease/Purchase Agreement ( "First Supplement ") dated as of December 1, 1994 is entered into by and between the City of Round Rock, Texas, as lessee (the "Lessee ") and Round Rock Golf, Inc., as lessor (the "Lessor "). W ITNESSETH: WHEREAS, the Lessor and Lessee have previously executed a "Golf Course Construction and Lease/Purchase Agreement" dated as of December 1, 1989 (the "Lease ") in connection with the acquisition, construction and financing of a public golf course; and WHEREAS, the Lessor and Lessee deem it advisable and necessary to amend the Lease, pursuant to the provisions of Section 15.4 to clarify the Lessee's ability to provide for the prepayment and defeasance of lease payments under the Lease and therefore releasing and defeasing its obligations under the Lease. NOW, THEREFORE, the parties hereto agree as follows: 1. Section 10.3 of the Lease is deleted in its entirety and is hereby amended to read in its entirety as follows: Section 10.03. Prepayment of Lease Payments and/or purchase of Project and Release of Lessor's Interest. Notwithstanding any other provision of this Lease Agreement to the contrary, the Lessee shall have the option to purchase the Project and/or make provision to prepay any of the remaining Lease Payments on any date by irrevocably depositing with or making available to the Trustee for such payment (1) lawful money of the United States of America sufficient to make such payment, (2) Government Obligations which mature as to principal and interest in such amounts and in such times to ensure the availability, without reinvestment, of sufficient money to provide for such Lease Payments as further set forth in Section 14.01 of the Trust Agreement as amended by the First Supplemental Trust Agreement dated as of December 1, 1994. Upon exercise by the Lessee of its option to purchase the Property by paying or making provision for the payment of all remaining Lease Payments and any other amounts then due or past due, Lessee shall have no further obligations under this Lease Agreement and the Ground Lease and Lessor and Trustee shall take all actions necessary to authorize, execute and deliver to Lessee any and all documents necessary to vest in Lessee, all of the Lessor's and Trustee's right, title and interest in and to the Project, free and clear of all liens, leasehold interests and encumbrances, including, if necessary, a release of any and all liens or interest created under the provisions of this Lease Agreement or the Ground Lease. 2. Except as expressly amended and modified hereby, all terms and provision of the Lease shall remain in full force and effect, and the Lessor and Lessee hereby ratify, confirm and adopt the Lease as amended and modified hereby. B -6 IN WITNESS WHEREOF, the parties hereto have caused this First Supplement to be duly executed by their respective authorized officers as of the day and year first above written and effective upon the receipt of the necessary consents. ATTEST: By: City Secretary ATTEST: By: Title: CITY OF ROUND ROCK, TEXAS, AS LESSEE By: Title: ROUND ROCK GOLF, INC., AS LESSOR By: Title: B -7 717 NORTH HARWOOD NINTH FLOOR DALLAS, TEXAS 75201.6587 TELEPHONE 2:4 220 -2600 F4CEIM,LE. 214 7549250 Ms. Joanne Land City Secretary City of Round Rock 221 East Main Street Round Rock, Texas 78664 Dear Joanne: CDP /mc Please call if you have any questions. cc: David Kautz Steve Sheets LAW OFFICES MCCALL, PARKHURST 3 HORTON L.L.P. 3100 ONE AMERICAN CENTER AUSTIN. TEXAS 78701.3248 TELEPHONE, 512 476 -3805 F4CS6 U.L: 512 4720971 December 28, 1994 Re: Golf Course Trust Certificates, Series 1989 Enclosed please find the following items for inclusion in the minutes of the City and Round Rock Golf, Inc., respectively: 1. Resolution Approving First Supplemental Trust Agreement and First Supplemental Lease Agreement executed by the City; 2. Resolution Approving First Supplemental Trust Agreement and First Supplemental Lease Agreement executed by Round Rock Golf, Inc.; and 3. Resolution Approving Form of Disclosure Document. S 1225 ONE RIVERWALK PLACE SAN ANTONIO, TEXAS 78205.3503 TELEPHONE: 210 225.2800 F4E3 2,0 225 -2984 urst & Horton L.L.P. DATE: December 20, 1994 SUBJECT: City Council Meeting, December 22, 1994 ITEM: 10. G. Consider a resolution approving form of Disclosure Document in Connection with Outstanding City of Round Rock, Texas Golf Course Trust Certificates, series 1989, Distribution of Disclosure Document and approving various documents in connection therewith. STAFF RESOURCE PERSON: Bob Bennett, David Kautz STAFF RECOMMENDATION: A presentation will be made at the meeting.