OFFICIAL STATEMENT DATED JULY 13, 2017 Ratings: S&P Insured: “AA” S&P Underlying: “A” NEW ISSUE - BOOK-ENTRY-ONLY (See “OTHER INFORMATION - RATINGS” herein) In the opinion of Naman, Howell, Smith & Lee PLLC, Bond Counsel, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986. In the further opinion of Bond Counsel, interest on the Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of, or the amount, accrual or receipt of interest on, the Bonds. See “TAX MATTERS. THE CITY HAS DESIGNATED THE BONDS AS “QUALIFIED TAX-EXEMPT OBLIGATIONS” FOR FINANCIAL INSTITUTIONS $3,715,000 CITY OF ITALY, TEXAS (Ellis County) GENERAL OBLIGATION REFUNDING BONDS, SERIES 2017 Interest to accrue from Date of Delivery Due: August 1, as shown on the inside cover PAYMENT TERMS . Interest on the $3,715,000 City of Italy, Texas, General Obligation Refunding Bonds, Series 2017 (the “Bonds”) will accrue from the Date of Delivery (as defined below) to the initial purchasers thereof, will be payable February 1 and August 1 of each year commencing February 1, 2018, and will be calculated on the basis of a 360-day year consisting of twelve 30-day months. The Bonds will be initially registered and delivered only to Cede & Co., the nominee of The Depository Trust Company (“DTC”), pursuant to the Book-Entry- Only System described herein. Beneficial ownership of the Bonds may be acquired in denominations of $5,000 or integral multiples thereof. No physical delivery of the Bonds will be made to the beneficial owners thereof. Principal of and interest on the Bonds will be payable by the Paying Agent/Registrar to Cede & Co., which will make distribution of the amounts so paid to the participating members of DTC for subsequent payment to the beneficial owners of the Bonds (see “THE BONDS - BOOK-ENTRY-ONLY SYSTEM”). The initial Paying Agent/Registrar is BOKF, N.A., Austin, Texas (see “THE BONDS - PAYING AGENT/REGISTRAR”). AUTHORITY FOR ISSUANCE . The Bonds are issued pursuant to the constitution and general laws of the State of Texas (the “State”), including Chapter 1207, Texas Government Code, as amended, and an ordinance adopted by the City Council of the City of Italy, Texas (the “City”) authorizing the issuance of the Bonds and a pricing certificate executed pursuant thereto (collectively, the “Ordinance”) (see “THE BONDS - AUTHORITY FOR ISSUANCE OF THE BONDS”). PURPOSE . Proceeds from the sale of the Bonds will be used to refund certain obligations of the City described in Schedule I (the “Refunded Obligations”) for debt service savings and to pay the costs associated with the issuance of the Bonds (see “PLAN OF FINANCING - SOURCES AND USES OF FUNDS”). SECURITY AND SOURCE OF PAYMENT. The Bonds constitute direct obligations of the City, payable from the levy and collection of a direct and continuing ad valorem tax, within the limits prescribed by law, on all taxable property within the City, as provided in the Ordinance (see “THE BONDS - SECURITY AND SOURCE OF PAYMENT”). OPTIONAL REDEMPTION . The City reserves the right, at its option, to redeem Bonds having stated maturities on and after August 1, 2028, in whole or in part in principal amounts of $5,000 or any integral multiple thereof, on August 1, 2027, or any date thereafter, at the par value thereof plus accrued interest to the date of redemption (see “THE BONDS - OPTIONAL REDEMPTION). INSURANCE . The scheduled payment of principal and interest on the Bonds when due will be guaranteed under a municipal bond insurance policy to be issued concurrently with the delivery of the Bonds by BUILD AMERICA MUTUAL ASSURANCE COMPANY. See Maturity Schedule on the inside cover LEGALITY . The Bonds are offered for delivery when, as and if issued and received by the underwriter listed below (the “Underwriter”) and subject to the approving opinion of the Attorney General of Texas and the opinion of Naman, Howell, Smith & Lee PLLC, Waco, Texas, Bond Counsel (see APPENDIX D, “FORM OF BOND COUNSEL OPINION”). Certain legal matters will be passed upon for the Underwriter by Orrick, Herrington & Sutcliff LLP, Houston, Texas, Counsel for the Underwriter. DELIVERY . It is expected that the Bonds will be available for delivery through the facilities of DTC on August 1, 2017 (“Date of Delivery”). RAYMOND JAMES MATURITY SCHEDULE $3,715,000 CITY OF ITALY, TEXAS GENERAL OBLIGATION REFUNDING BONDS, SERIES 2017 MATURITIES, PRINCIPAL AMOUNTS, INTEREST RATES, INITIAL YIELDS AND CUSIPS Base CUSIP Number: Stated Maturity Principal Interest Initial (August 1)(1) Amount Rate (%) Yield (%)(2) CUSIP(3) 2018 $210,000 2.000 1.100 465416CN3 2019 210,000 2.000 1.350 465416CP8 2020 215,000 2.000 1.500 465416CQ6 2021 220,000 2.000 1.600 465416CR4 2022 220,000 2.000 1.750 465416CS2 2023 225,000 3.000 1.900 465416CT0 2024 230,000 3.000 2.000 465416CU7 2025 245,000 3.000 2.200 465416CV5 2026 250,000 3.000 2.350 465416CW3 2027 255,000 4.000 2.500 465416CX1 2028(4) 265,000 4.000 2.600 465416CY9 2029(4) 275,000 4.000 2.700 465416CZ6 2030(4) 285,000 4.000 2.800 465416DA0 2031(4) 300,000 4.000 2.850 465416DB8 2032(4) 310,000 4.000 2.900 465416DC6 (Interest to accrue from the Date of Delivery) ___________________________ (1) The Bonds maturing on or after August 1, 2028 are subject to redemption, in whole or from time to time in part at the option of the City, on August 1, 2027 or any date thereafter at a redemption price of par plus accrued interest to the date of redemption. (See “THE BONDS — Redemption Provisions”). (2) The initial yields are established by and are the sole responsibility of the Underwriter, and may be subsequently changed. (3) CUSIP numbers have been assigned to this issue and are included solely for the convenience of the owners of the Bonds. “CUSIP” is a registered trademark of the American Bankers Association. CUSIP data herein is provided by CUSIP Global Services, managed by S&P Capital IQ on behalf of American Bankers Association. This data is not intended to create a database and does not serve in anyway as a substitute for the CUSIP services. Neither the City, the Financial Advisor, nor the Underwriter is responsible for the selection or correctness of the CUSIP numbers set forth herein. (4) Priced to call on August 1, 2027. ii CITY OF ITALY, TEXAS CITY COUNCIL Jackie D. Cate Mayor Frank Jackson Mayor Pro Tem Paul Cockerham Council Member Stevan Varner Council Member Carl Cash Council Member Gene Williams Council Member ADMINISTRATIVE OFFICERS Shawn Holden City Administrator Amber Cunningham Assistant City Secretary Brandon S. Shelby City Attorney CONSULTANTS, ADVISORS AND INDEPENDENT AUDITORS Naman, Howell, Smith & Lee PLLC, Waco, Texas Bond Counsel Misty Culpepper, CPA, PLLC, Ennis, Texas Independent Auditor Government Capital Securities Corporation, Southlake, Texas Financial Advisor For additional information regarding the City, please contact: Shawn Holden Mike Brown City Administrator Government Capital Securities Corporation City of Italy, Texas 559 Silicon Drive, Suite 102 161 West Main Street Southlake, TX 76092 P. O. Box 840 (903) 348-6095 Italy, Texas 76651 [email protected] (972) 483-7329 [email protected] iii No dealer, broker, salesman or other person has been authorized by the City or the Underwriter to give any information, or to make any representations other than those contained in this Official Statement, and, if given or made, such other information or representations must not be relied upon as having been authorized by the City or the Underwriter. This Official Statement does not constitute an offer to sell Bonds in any jurisdiction to any person to whom it is unlawful to make such offer in such jurisdiction. Certain information set forth herein has been obtained from the City and other sources which are believed to be reliable but is not guaranteed as to accuracy or completeness, and is not to be construed as a representation by the Financial Advisor or the Underwriter. Any information and expressions of opinion herein contained are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the City or other matters described herein since the date hereof. IN CONNECTION WITH THE OFFERING OF THE BONDS, THE UNDERWRITER MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICES OF THE BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. NONE OF THE CITY, ITS FINANCIAL ADVISOR, OR THE UNDERWRITER MAKES ANY REPRESENTATION OR WARRANTY WITH RESPECT TO THE INFORMATION CONTAINED IN THIS OFFICIAL STATEMENT REGARDING THE DEPOSITORY TRUST COMPANY OR ITS BOOK-ENTRY ONLY SYSTEM. THE BONDS ARE EXEMPT FROM REGISTRATION WITH THE SECURITIES AND EXCHANGE COMMISSION AND CONSEQUENTLY HAVE NOT BEEN REGISTERED THEREWITH. THE REGISTRATION, QUALIFICATION, OR EXEMPTION OF THE BONDS IN ACCORDANCE WITH APPLICABLE SECURITIES LAW PROVISIONS OF THE JURISDICTIONS IN WHICH THESE SECURITIES HAVE BEEN REGISTERED, QUALIFIED, OR EXEMPTED SHOULD NOT BE REGARDED AS A RECOMMENDATION THEREOF.