HomeMy WebLinkAbout11-1378 12-13-2011 CERTIFICATE OF SECRETARY
THE STATE OF TEXAS
S EULESS DEVELOPMENT CORPORATION
COUNTY OF TARRANT
I,the undersigned,Secretary of the Euless Development Corporation(the"Corporation"),
DO HEREBY CERTIFY as follows:
1. On the 12th day of December, 2011, a regular meeting of the Board of Directors of
the Corporation(the"Board") was held at the Corporation's offices in the City of Euless, Texas;
the duly constituted members of the Board being as follows:
MARY LIB SALEH CHAIRMAN
LINDA MARTIN VICE CHAIRMAN
TIM STINNEFORD DIRECTOR
WAYNE MARRS DIRECTOR
CARMEN DEITHLOFF DIRECTOR
SONJA ADAMS DIRECTOR
GLENN PORTERFIELD DIRECTOR
and all of said board members were present at said meeting, except: Tim Stinneford. Among
other business considered at said meeting,the attached resolution entitled:
"A RESOLUTION authorizing the issuance of `EULESS DEVELOPMENT
CORPORATION SALES TAX REVENUE REFUNDING BONDS,
SERIES 2012'; pledging certain "Pledged Revenues" of the Corporation,
including "Gross Sales Tax Revenues", to the payment of the principal of
and interest on said bonds and enacting other provisions incident and
related to the issuance, payment, security and delivery of said bonds,
including the approval and execution of a Paying Agent/Registrar
Agreement, an Escrow Agreement and a Purchase Letter; and providing
an effective date"
was introduced and submitted to the Board for passage and adoption. After presentation and due
consideration of the resolution and, upon a motion made and seconded, the resolution was duly
passed and adopted by the Board to be effective immediately by the following vote:
6 voted"For" 0 voted"Against" 0 abstained
all as shown in the official minutes of the Board for the meeting held on the aforesaid date.
2. The attached resolution is a true and correct copy of the original on file in the
official records of the Corporation; the duly qualified and acting members of the Board on the
date of the aforesaid meeting are those persons shown above and, according to the records of my
office, advance notice of the time, place and purpose of the meeting was given to each member
of the Board; and that said meeting, and the deliberation of the aforesaid public business, was
open to the public and written notice of said meeting, including the subject of the above entitled
resolution, was posted and given in advance thereof in compliance with the provisions of
V.T.C.A., Government Code,Chapter 551,as amended.
95351628.1/11112133
IN WITNESS WHEREOF, I have hereunto signed my name officially and affixed the
seal of said Corporation,this the 12`h day of December,2011.
/14.4/ AZ/at)
retary,Euless Development Corporation
(Corporate Seal)
95351628.1/11112133 s-1
A RESOLUTION authorizing the issuance of "EULESS DEVELOPMENT
CORPORATION SALES TAX REVENUE REFUNDING BONDS,
SERIES 2012"; pledging certain "Pledged Revenues" of the Corporation,
including "Gross Sales Tax Revenues", to the payment of the principal of
and interest on said bonds and enacting other provisions incident and
related to the issuance, payment, security and delivery of said bonds,
including the approval and execution of a Paying Agent/Registrar
Agreement, an Escrow Agreement and a Purchase Letter; and providing
an effective date.
WHEREAS, the Euless Development Corporation (the "Corporation"), a non-profit
corporation duly organized and existing under the laws of the State of Texas, including the
Development Corporation Act, V.T.C.A, Local Government Code, Title 12, Subtitle Cl, as
amended, specifically Chapters 501 and 505 of the Texas Local Government Code (the "Act"),
has heretofore issued, sold and delivered, and there is currently outstanding, obligations totaling
in principal amount$3,715,000 (collectively,the"Refunded Bonds")more particularly described
as follows:
(1) Euless Development Corporation Sales Tax Revenue Refunding
Bonds, Series 2002, dated June 15,2002, scheduled to mature on September 15 in
each of the years 2012 through 2015, and aggregating in the principal amount of
$2,655,000(the"Series 2002 Refunded Bonds"); and
(2) Euless Development Corporation Sales Tax Revenue Refunding
Bonds, Series 2006, dated January 1, 2006, scheduled to mature on September 15
in each of the years 2012 through 2019, and aggregating in the principal amount
of$1,060,000(the"Series 2006 Refunded Bonds");and
WHEREAS, the Board of Directors of the Corporation (the "Board") hereby finds and
determines that refunding bonds at this time to refund the Refunded Bonds to provide gross debt
service savings of approximately $225,523.50 and present value savings of approximately
$180,443.98;now,therefore,
BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE EULESS
DEVELOPMENT CORPORATION:
SECTION 1. Authorization - Designation - Principal Amount - Purpose. Bonds of the
Corporation shall be and are hereby authorized to be issued in the aggregate principal amount of
$3,785,000 to be designated and bear the title "EULESS DEVELOPMENT CORPORATION
SALES TAX REVENUE REFUNDING BONDS, SERIES 2012" (hereinafter referred to as the
"Bonds") for the purpose of refunding certain outstanding obligations of the Corporation
(identified in the preamble hereof and referred to collectively as the "Refunded Bonds") and to
pay costs of issuance associated with the issuance of the Bonds, in conformity with the
Constitution and laws of the State of Texas, including the Act.
SECTION 2. Fully Registered Obligations - Authorized Denominations - Stated
Maturities - Bond Date. The Bonds shall be issued as fully registered obligations only, shall be
77339817.3/11112133
dated January 1, 2012 (the "Bond Date"), shall be in denominations of$5,000 or any integral
multiple (within a Stated Maturity) thereof, and shall become due and payable semiannually on
September 15 in each of the years, at the interest rate and in the principal amounts (the "Stated
Maturities")in accordance with the following schedule:
Year of Principal Interest
Stated Maturity Amount Rate
2012 $ 875,000 1.43 %
2013 860,000 1.43
2014 875,000 1.43
2015 890,000 1.43
2016 165,000 1.43
2017 45,000 1.43
2018 35,000 1.43
2019 40,000 1.43
Interest on the Bonds shall accrue from the date of their delivery to the initial purchaser
(January 12, 2012) and shall be payable on September 15, 2012, and on each March 15 and
September 15 thereafter until maturity or prior redemption.
SECTION 3. Terms of Payment-Paying Agent/Registrar. The principal of,premium, if
any, and the interest on the Bonds, due and payable by reason of maturity, redemption or
otherwise, shall be payable only to the registered owners or holders of the Bonds (hereinafter
called the "Holders") appearing on the registration and transfer books maintained by the Paying
Agent/Registrar and the payment thereof shall be in any coin or currency of the United States of
America which at the time of payment is legal tender for the payment of public and private debts,
and shall be without exchange or collection charges to the Holders.
The selection and appointment of BOKF, NA dba Bank of Texas, Fort Worth, Texas to
serve as Paying Agent/Registrar for the Bonds is hereby approved and confirmed. Books and
records relating to the registration, payment, transfer and exchange of the Bonds (the "Security
Register") shall at all times be kept and maintained on behalf of the Corporation by the Paying
Agent/Registrar, as provided herein and in accordance with the terms and provisions of a
"Paying Agent/Registrar Agreement", substantially in the form attached hereto as Exhibit A,and
such reasonable rules and regulations as the Paying Agent/Registrar and the Corporation may
prescribe. The President or Vice President and the Secretary of the Corporation are authorized to
execute and deliver such Paying Agent/Registrar Agreement in connection with the delivery of
the Bonds. The Corporation covenants to maintain and provide a Paying Agent/Registrar at all
times until the Bonds are paid and discharged, and any successor Paying Agent/Registrar shall be
a commercial bank, trust company, financial institution or other entity qualified and authorized
to serve in such capacity and perform the duties and services of Paying Agent/Registrar. Upon
any change in the Paying Agent/Registrar for the Bonds, the Corporation agrees to promptly
cause a written notice thereof to be sent to each Holder by United States Mail, first class postage
prepaid,which notice shall also give the address of the new Paying Agent/Registrar.
Principal of and premium, if any, on the Bonds, shall be payable at the Stated Maturities
or on a date of earlier redemption thereof only upon presentation and surrender of the Bonds to
77339817.3/11112133 2
the Paying Agent/Registrar at its designated offices, initially in Fort Worth, Texas, or, with
respect to a successor Paying Agent/Registrar, at the designated offices of such successor (the
"Designated Payment/Transfer Office"). Interest on the Bonds shall be paid to the Holders
whose names appear in the Security Register at the close of business on the Record Date (the last
business day of the month next preceding each interest payment date) and shall be paid by the
Paying Agent/Registrar (i) by check sent United States Mail, first class postage prepaid, to the
address of the Holder recorded in the Security Register or (ii) by such other method, acceptable
to the Paying Agent/Registrar, requested by, and at the risk and expense of, the Holder. If the
date for the payment of the principal of or interest on the Bonds shall be a Saturday, Sunday, a
legal holiday, or a day when banking institutions in the city where the Designated
Payment/Transfer Office of the Paying Agent/Registrar is located are authorized by law or
executive order to close, then the date for such payment shall be the next succeeding day which
is not such a Saturday, Sunday, legal holiday, or day when banking institutions are authorized to
close; and payment on such date shall have the same force and effect as if made on the original
date payment was due.
In the event of a nonpayment of interest on a scheduled payment date, and for thirty (30)
days thereafter, a new record date for such interest payment (a "Special Record Date") will be
established by the Paying Agent/Registrar, if and when funds for the payment of such interest
have been received from the Corporation. Notice of the Special Record Date and of the
scheduled payment date of the past due interest(which shall be 15 days after the Special Record
Date) shall be sent at least five (5) business days prior to the Special Record Date by United
States Mail, first class postage prepaid, to the address of each Holder appearing on the Security
Register at the close of business on the last business day next preceding the date of mailing of
such notice.
SECTION 4. Redemption.
(a) Optional Redemption. The Bonds may be redeemed prior to their Stated Maturities,
at the option of the Corporation, in whole or in part in principal amounts of $5,000 or any
integral multiple thereof(and if within a Stated Maturity by lot by the Paying Agent/Registrar),
at the redemption price of par, together with accrued interest to the date of redemption,plus the
Prepayment Fee as of the date of redemption.
The Prepayment Fee is calculated by multiplying:
(1) any decrease in yield in the Reference Rate between the date of
delivery of the Bonds and the prepayment date, by
(2) the number of years or partial years remaining in the portion of the
Bond being redeemed,by
(3) the average balance remaining through maturity of the portion of the
Bond being redeemed.
"Interest Rate Swap Rate" is defined as the interest rate swap rate for the term closest in
time to the remaining term of the Bond as such rate has most recently been published by the
Federal Reserve Bank on its website under Federal Reserve Statistical Release H.15, as the
77339817.3/11112133 3
International Swaps and Derivatives Association ("ISDA") mid-market par swap rate. In the
event the Federal Reserve Board fails to publish information from the ISDA concerning the mid-
market par swap rate, the parties shall refer to the source of such information (as set forth in
footnote 15 of the Federal Reserve Statistical Release H.15 as published on October 2, 2000) in
order to determine the Interest Rate Swaps Rate.
"LIBOR Rate" is defined as the London Interbank Offered Rate (LIBOR) established by
the British Banker's Association for deposits in US dollars for the term closest in time to the
remaining term of the Bond.
"Reference Rate" is defined as (a) the LIBOR rate when the remaining term of the Bond
is 12 months or less, or (b)the Interest Rate Swap Rate when the remaining term of the Bond is
greater than 12 months.
(b) Exercise of Redemption Option. At least forty five (45) days prior to a redemption
date for the Bonds (unless a shorter notification period shall be satisfactory to the Paying
Agent/Registrar), the Corporation shall notify the Paying Agent/Registrar of the decision to
redeem Bonds, the principal amount of each Stated Maturity to be redeemed, and the date of
redemption therefor. The decision of the Corporation to exercise the right to redeem Bonds
shall be entered in the minutes of the governing body of the Corporation.
(c) Selection of Bonds for Redemption. If less than all Outstanding Bonds of the same
Stated Maturity are to be redeemed on a redemption date, the Paying Agent/Registrar shall treat
such Bonds as representing the number of Bonds Outstanding which is obtained by dividing the
principal amount of such Bonds by $5,000 and shall select the Bonds, or principal amount
thereof,to be redeemed within such Stated Maturity by lot.
(d) Notice of Redemption. Not less than thirty(30) days prior to a redemption date for
the Bonds, a notice of redemption shall be sent by United States Mail, first class postage
prepaid, in the name of the Corporation and at the Corporation's expense, to each Holder of a
Bond to be redeemed in whole or in part at the address of the Holder appearing on the Security
Register at the close of business on the business day next preceding the date of mailing such
notice, and any notice of redemption so mailed shall be conclusively presumed to have been
duly given irrespective of whether received by the Holder.
All notices of redemption shall (i) specify the date of redemption for the Bonds,
(ii) identify the Bonds to be redeemed and, in the case of a portion of the principal amount to be
redeemed,the principal amount thereof to be redeemed, (iii) state the redemption price, (iv) state
that the Bonds, or the portion of the principal amount thereof to be redeemed, shall become due
and payable on the redemption date specified, and the interest thereon, or on the portion of the
principal amount thereof to be redeemed, shall cease to accrue from and after the redemption
date, and(v)specify that payment of the redemption price for the Bonds, or the principal amount
thereof to be redeemed, shall be made at the Designated Payment/Transfer Office of the Paying
Agent/Registrar only upon presentation and surrender thereof by the Holder. If a Bond is subject
by its terms to prior redemption, and has been called for redemption, and notice of redemption
thereof has been duly given as hereinabove provided, such Bond(or the principal amount thereof
to be redeemed) shall become due and payable and interest thereon shall cease to accrue from
77339817.3/11112133 4
and after the redemption date therefor; provided moneys sufficient for the payment of such Bond
(or of the principal amount thereof to be redeemed) at the then applicable redemption price are
held for the purpose of such payment by the Paying Agent/Registrar.
(e) Conditional Notice of Redemption. With respect to any optional redemption of the
Bonds, unless moneys sufficient to pay the principal of and premium, if any, and interest on the
Bonds to be redeemed shall have been received by the Paying Agent/Registrar prior to the
giving of such notice of redemption, such notice may state that said redemption is conditional
upon the receipt of such moneys by the Paying Agent/Registrar on or prior to the date fixed for
such redemption, or upon the satisfaction of any prerequisites set forth in such notice of
redemption; and, if sufficient moneys are not received, such notice shall be of no force and
effect, the Corporation shall not redeem such Bonds and the Paying Agent/Registrar shall give
notice, in the manner in which the notice of redemption was given,to the effect that the Bonds
have not been redeemed.
SECTION 5. Registration - Transfer - Exchange of Bonds - Predecessor Bonds. The
Paying Agent/Registrar shall obtain, record, and maintain in the Security Register the name and
address of each and every owner of the Bonds issued under and pursuant to the provisions of this
Resolution, or if appropriate, the nominee thereof. Any Bond may be transferred or exchanged
for Bonds of other authorized denominations by the Holder, in person or by his duly authorized
agent,upon surrender of such Bond to the Paying Agent/Registrar for cancellation, accompanied
by a written instrument of transfer or request for exchange duly executed by the Holder or by his
duly authorized agent,in form satisfactory to the Paying Agent/Registrar.
Upon surrender of any Bond (other than the Initial BoncF(s) referenced in Section 7
hereof)for transfer at the Designated Payment/Transfer Office of the Paying Agent/Registrar,the
Paying Agent/Registrar shall register and deliver, in the name of the designated transferee or
transferees, one or more new Bonds of authorized denominations and having the same Stated
Maturity and of a like aggregate principal amount as the Bond or Bonds surrendered for transfer.
At the option of the Holder, Bonds (other than the Initial Bond(s)referenced in Section 7
hereof) may be exchanged for other Bonds of authorized denominations and having the same
Stated Maturity, bearing the same rate of interest and of like aggregate principal amount as the
Bonds surrendered for exchange,upon surrender of the Bonds to be exchanged at the Designated
Payment/Transfer Office of the Paying Agent/Registrar. Whenever any Bonds are surrendered
for exchange, the Paying Agent/Registrar shall register and deliver new Bonds to the Holder
requesting the exchange.
All Bonds issued in any transfer or exchange of Bonds shall be delivered to the Holders
at the Designated Payment/Transfer Office of the Paying Agent/Registrar or sent by United
States Mail, first class, postage prepaid to the Holders, and, upon the registration and delivery
thereof, the same shall be the valid obligations of the Corporation, evidencing the same
obligation to pay, and entitled to the same benefits under this Resolution, as the Bonds
surrendered in such transfer or exchange.
All transfers or exchanges of Bonds pursuant to this Section shall be made without
expense or service charge to the Holder, except as otherwise herein provided, and except that the
77339817.3/11112133 5
Paying Agent/Registrar shall require payment by the Holder requesting such transfer or exchange
of any tax or other governmental charges required to be paid with respect to such transfer or
exchange.
Bonds cancelled by reason of an exchange or transfer pursuant to the provisions hereof
are hereby defined to be "Predecessor Bonds,"evidencing all or a portion, as the case may be, of
the same obligation to pay evidenced by the new Bond or Bonds registered and delivered in the
exchange or transfer therefor. Additionally, the term "Predecessor Bonds" shall include any
mutilated, lost, destroyed, or stolen Bond for which a replacement Bond has been issued,
registered, and delivered in lieu thereof pursuant to the provisions of Section 25 hereof and such
new replacement Bond shall be deemed to evidence the same obligation as the mutilated, lost,
destroyed,or stolen Bond.
Neither the Corporation nor the Paying Agent/Registrar shall be required to issue or
transfer to an assignee of a Holder any Bond called for redemption, in whole or in part,within 45
days of the date fixed for the redemption of such Bond; provided, however, such limitation on
transferability shall not be applicable to an exchange by the Holder of the unredeemed balance of
a Bond called for redemption in part.
SECTION 6. Execution - Registration. The Bonds shall be executed on behalf of the
Corporation by the President of the Corporation and attested by the Secretary of the Corporation.
The signature of said officers on the Bonds may be manual or facsimile. Bonds bearing the
manual or facsimile signatures of individuals who are or were the proper officers of the
Corporation on the Bond Date shall be deemed to be duly executed on behalf of the Corporation,
notwithstanding that such individuals or either of them shall cease to hold such offices at the
time of delivery of the Bonds to the initial purchasers and with respect to Bonds delivered in
subsequent exchanges and transfers.
No Bond shall be entitled to any right or benefit under this Resolution, or be valid or
obligatory for any purpose, unless there appears on such Bond either a certificate of registration
substantially in the form provided in Section 8(c), manually executed by the Comptroller of
Public Accounts of the State of Texas or his duly authorized agent,or a certificate of registration
substantially in the form provided in Section 8(d), manually executed by an authorized officer,
employee or representative of the Paying Agent/Registrar, and either such certificate upon any
Bond duly signed shall be conclusive evidence, and the only evidence, that such Bond has been
duly certified,registered and delivered.
SECTION 7. Initial Bond(s). The Bonds herein authorized shall be initially issued either
(i)as a single fully registered bond in the aggregate principal amount of the Bonds with principal
installments to become due and payable as provided in Section 2 hereof and numbered T-1, or
(ii) as multiple fully registered bonds, being one bond for each year of maturity in the applicable
principal amount and denomination and to be numbered consecutively from T-1 and upward
(hereinafter called the"Initial Bond(s)") and, in either case,the Initial Bond(s) shall be registered
in the name of the initial purchaser(s) or the designee thereof. The Initial Bond(s) shall be the
Bond(s) submitted to the Office of the Attorney General of the State of Texas for approval,
certified and registered by the Office of the Comptroller of Public Accounts of the State of Texas
and delivered to the initial purchaser(s). Any time after the delivery of the Initial Bond(s), the
77339817.3/11112133 6
Paying Agent/Registrar, pursuant to written instructions from the initial purchaser(s), or the
designee thereof, shall cancel the Initial Bond(s) delivered hereunder and exchange therefor
definitive Bonds of authorized denominations, Stated Maturities, principal amounts and bearing
applicable interest rates for transfer and delivery to the Holders named at the addresses identified
therefor; all pursuant to and in accordance with such written instructions from the initial
purchaser(s), or the designee thereof, and such other information and documentation as the
Paying Agent/Registrar may reasonably require.
SECTION 8. Forms.
(a) Forms Generally. The Bonds, the Registration Certificate of the Comptroller of
Public Accounts of the State of Texas, the Registration Certificate of Paying Agent/Registrar,
and the form of Assignment to be printed on each of the Bonds, shall be substantially in the
forms set forth in this Section with such appropriate insertions, omissions, substitutions, and
other variations as are permitted or required by this Resolution and may have such letters,
numbers, or other marks of identification (including identifying numbers and letters of the
Committee on Uniform Securities Identification Procedures of the American Bankers
Association) and such legends and endorsements (including insurance legends in the event the
Bonds, or any maturities thereof, are purchased with insurance and any reproduction of an
opinion of counsel) thereon as may, consistently herewith, be established by the Board or
determined by the officers executing such Bonds as evidenced by their execution. Any portion
of the text of any Bonds may be set forth on the reverse thereof, with an appropriate reference
thereto on the face of the Bond.
The definitive Bonds and the Initial Bond(s) shall be printed, lithographed, engraved,
typewritten, photocopied or otherwise reproduced in any other similar manner, all as determined
by the officers executing such Bonds as evidenced by their execution thereof.
(b) Form of Definitive Bonds.
REGISTERED REGISTERED
NO. R-_ $
UNITED STATES OF AMERICA
STATE OF TEXAS
EULESS DEVELOPMENT CORPORATION
SALES TAX REVENUE REFUNDING BOND
SERIES 2012
Bond Date: Interest Rate: Stated Maturity: ;
January 1, 2012 1.43% September 15, 20
Registered Owner:
Principal Amount: DOLLARS
The Euless Development Corporation (hereinafter referred to as the "Corporation"), a
non-profit industrial development corporation organized and existing under the laws of the State
of Texas, including the Act, with its principal office located in Tarrant County, Texas, for value
77339817.3/11112133 7
received, acknowledges itself indebted to and hereby promises to pay to the Registered Owner
named above, or the registered assigns thereof, on the Stated Maturity date specified above the
Principal Amount hereinabove stated(or so much thereof as shall not have been paid upon prior
redemption),and to pay interest on the unpaid principal amount hereof from the interest payment
date next preceding the "Registration Date" of this Bond appearing below (unless this Bond
bears a "Registration Date" as of an interest payment date, in which case it shall bear interest
from such date, or unless the "Registration Date" of this Bond is prior to the initial interest
payment date in which case it shall bear interest from the date of delivery to the initial purchasers
(January 12, 2012)) at the per annum rate of interest specified above computed on the basis of a
360-day year of twelve 30-day months; such interest being payable on March 15 and September
15 in each year, commencing September 15, 2012, until maturity or prior redemption. Principal
of this Bond shall be payable at its Stated Maturity or on a redemption date to the Registered
Owner hereof upon presentation and surrender at the designated offices of the Paying
Agent/Registrar executing the registration certificate appearing hereon, initially in Fort Worth,
Texas, or, with respect to a successor Paying Agent/Registrar, at the designated offices of such
successor (the "Designated Payment/Transfer Office"). Interest is payable to the registered
owner of this Bond (or one or more Predecessor Bonds, as defined in the Resolution hereinafter
referenced) whose name appears on the "Security Register" maintained by the Paying
Agent/Registrar at the close of business on the "Record Date", which is the last business day of
the month next preceding each interest payment date, and interest shall be paid by the Paying
Agent/Registrar by check sent United States Mail, first class postage prepaid, to the address of
the registered owner recorded in the Security Register or by such other method, acceptable to the
Paying Agent/Registrar,requested by,and at the risk and expense of,the registered owner. If the
date for the payment of the principal of or interest on the Bonds shall be a Saturday, Sunday, a
legal holiday, or a day when banking institutions in the city where the Designated
Payment/Transfer Office of the Paying Agent/Registrar is located are authorized by law or
executive order to close, then the date for such payment shall be the next succeeding day which
is not such a Saturday, Sunday, legal holiday,or day when banking institutions are authorized to
close; and payment on such date shall have the same force and effect as if made on the original
date payment was due. All payments of principal of, premium, if any, and interest on this Bond
shall be without exchange or collection charges to the owner hereof and in any coin or currency
of the United States of America which at the time of payment is legal tender for the payment of
public and private debts.
This Bond is one of the series specified in its title issued in the aggregate principal
amount of$3,785,000 (herein referred to as the "Bonds") for the purpose of providing funds to
refund certain outstanding obligations of the Corporation (identified in the preamble of the
Resolution described below and referred to as the "Refunded Bonds"), in conformity with the
Constitution and laws of the State of Texas, including the Act, and pursuant to a Resolution
adopted by the governing body of the Corporation(herein referred to as the"Resolution").
The Bonds may be redeemed prior to their Stated Maturities, at the option of the
Corporation, in whole or in part in principal amounts of$5,000 or any integral multiple thereof
(and if within a Stated Maturity by lot by the Paying Agent/Registrar), at the redemption price of
par, together with accrued interest to the date of redemption, plus the Prepayment Fee as of the
date of redemption.
77339817.3/11112133 8
The Prepayment Fee is calculated by multiplying:
(1) any decrease in yield in the Reference Rate between the date of
delivery of the Bonds and the prepayment date,by
(2) the number of years or partial years remaining in the portion of the
Bond being redeemed,by
(3) the average balance remaining through maturity of the portion of the
Bond being redeemed.
"Interest Rate Swap Rate" is defined as the interest rate swap rate for the term closest in
time to the remaining term of the Bond as such rate has most recently been published by the
Federal Reserve Bank on its website under Federal Reserve Statistical Release H.15, as the
International Swaps and Derivatives Association ("ISDA") mid-market par swap rate. In the
event the Federal Reserve Board fails to publish information from the ISDA concerning the mid-
market par swap rate, the parties shall refer to the source of such information (as set forth in
footnote 15 of the Federal Reserve Statistical Release 1.15 as published on October 2, 2000) in
order to determine the Interest Rate Swaps Rate.
"LIBOR Rate" is defined as the London Interbank Offered Rate (LIBOR) established by
the British Banker's Association for deposits in US dollars for the term closest in time to the
remaining term of the Bond.
"Reference Rate" is defined as (a) the LIBOR rate when the remaining term of the Bond
is 12 months or less, or(b) the Interest Rate Swap Rate when the remaining term of the Bond is
greater than 12 months.
At least thirty days prior to the date fixed for any redemption of Bonds, the Corporation
shall cause a written notice of such redemption to be sent by United States Mail, first class
postage prepaid, to the registered owners of each Bond to be redeemed at the address shown on
the Security Register and subject to the terms and provisions relating thereto contained in the
Resolution. If a Bond (or any portion of its principal sum) shall have been duly called for
redemption and notice of such redemption duly given, then upon such redemption date such
Bond (or the portion of its principal sum to be redeemed) shall become due and payable, and
interest thereon shall cease to accrue from and after the redemption date therefor; provided
moneys for the payment of the redemption price and the interest on the principal amount to be
redeemed to the date of redemption are held for the purpose of such payment by the Paying
Agent/Registrar.
In the event a portion of the principal amount of a Bond is to be redeemed and the
registered owner is someone other than Cede & Co., payment of the redemption price of such
principal amount shall be made to the registered owner only upon presentation and surrender of
such Bond to the Designated Payment/Transfer Office of the Paying Agent/Registrar, and a new
Bond or Bonds of like maturity and interest rate in any authorized denominations provided by
the Resolution for the then unredeemed balance of the principal sum thereof will be issued to the
registered owner, without charge. If a Bond is selected for redemption, in whole or in part, the
Corporation and the Paying Agent/Registrar shall not be required to transfer such Bond to an
77339817.3/11112133 9
assignee of the registered owner within 45 days of the redemption date therefor; provided,
however, such limitation on transferability shall not be applicable to an exchange by the
registered owner of the unredeemed balance of a Bond redeemed in part.
With respect to any optional redemption of the Bonds,unless certain prerequisites to such
redemption required by the Resolution have been met and moneys sufficient to pay the
redemption price of the Bonds to be redeemed shall have been received by the Paying
Agent/Registrar prior to the giving of such notice of redemption, such notice may state that said
redemption is conditional upon the satisfaction of such prerequisites and receipt of such moneys
by the Paying Agent/Registrar on or prior to the date fixed for such redemption, or upon any
prerequisite set forth in such notice of redemption. If a conditional notice of redemption is given
and such prerequisites to the redemption and sufficient moneys are not received, such notice
shall be of no force and effect, the Corporation shall not redeem such Bonds and the Paying
Agent/Registrar shall give notice, in the manner in which the notice of redemption was given, to
the effect that the Bonds have not been redeemed.
The Bonds are payable solely from and equally and ratably secured by a pledge of the
Pledged Revenues received by the Corporation, including the receipts from a Sales Tax levied
for the benefit of the Corporation pursuant to the Act and an election held in the City of Euless,
Texas (the "City"). The Bonds do not constitute a legal or equitable, pledge, charge, lien or
encumbrance upon any property of the Corporation or the City except with respect to the
Pledged Revenues. This Bond may not be paid in whole or in part from any property taxes
raised or to be raised by the City and is not a debt of and does not give rise to a claim for
payment against the City, except as to the sales and use tax revenues held by the City and
required under the Act to be paid over to the Corporation. Neither the State of Texas, the City
nor any political corporation, subdivision or agency of the State of Texas shall be obligated to
pay this Bond or the interest hereon and neither the faith and credit nor the taxing power of the
State, the City or any other political corporation, subdivision or agency thereof is pledged to the
payment of the principal of and interest on this Bond except as noted above.
Subject to satisfying the terms and conditions prescribed therefor, the Corporation has
reserved the right to issue additional revenue obligations payable, in whole or in part, from the
Pledged Revenues and equally and ratably secured in like manner and effect as the Bonds.
Reference is hereby made to the Resolution, a copy of which is on file in the Designated
Payment/Transfer Office of the Paying Agent/Registrar, and to all of the provisions of which the
Holder by the acceptance hereof hereby assents, for definitions of terms; the description of and
the nature and extent of the security for the payment of the Bonds; the rights of Holders of the
Bonds the terms and conditions for the issuance of additional obligations; the terms and
conditions relating to the payment, transfer or exchange of this Bond; the conditions upon which
the Resolution may be amended or supplemented with or without the consent of the Holders;the
rights, duties, and obligations of the Corporation and the Paying Agent/Registrar; the terms and
provisions upon which the encumbrances, pledges, charges and covenants made therein may be
discharged; and for the other terms and provisions contained therein. Capitalized terms used
herein have the same meanings assigned in the Resolution.
77339817.3/11112133 10
This Bond, subject to certain limitations contained in the Resolution, may be transferred
on the Security Register only upon its presentation and surrender at the Designated
Payment/Transfer Office of the Paying Agent/Registrar, with the Assignment hereon duly
endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the
Paying Agent/Registrar duly executed by, the registered owner hereof, or his duly authorized
agent. When a transfer on the Security Register occurs, one or more new fully registered Bonds
of the same Stated Maturity, of authorized denominations, bearing the same rate of interest, and
of the same aggregate principal amount will be issued by the Paying Agent/Registrar to the
designated transferee or transferees.
The Corporation and the Paying Agent/Registrar, and any agent of either, may treat the
registered owner hereof whose name appears on the Security Register (i)on the Record Date as
the owner entitled to payment of interest hereon, (ii)on the date of surrender of this Bond as the
owner entitled to payment of principal hereof at its Stated Maturity or its redemption,in whole or
in part, and (iii) on any other date as the owner for all other purposes, and neither the
Corporation nor the Paying Agent/Registrar, or any agent of either, shall be affected by notice to
the contrary. In the event of non-payment of interest on a scheduled payment date and for
thirty(30)days thereafter,a new record date for such interest payment(a"Special Record Date")
will be established by the Paying Agent/Registrar, if and when funds for the payment of such
interest have been received from the Corporation. Notice of the Special Record Date and of the
scheduled payment date of the past due interest (which shall be 15 days after the Special Record
Date) shall be sent at least five(5) business days prior to the Special Record Date by United
States Mail, first class postage prepaid, to the address of each Holder appearing on the Security
Register at the close of business on the last business day next preceding the date of mailing of
such notice.
It is hereby certified, recited, represented and covenanted that the Corporation is a
non-profit industrial development corporation duly organized and legally existing under and by
virtue of the Constitution and laws of the State of Texas, including the Act; that all acts,
conditions and things required to exist and be done precedent to and in the issuance of the Bonds
to render the same lawful and valid special obligations of the Corporation have been properly
done, have happened and have been performed in regular and due time, form and manner as
required by law; and that due provision has been made for the payment of the Bonds from the
sources and in the manner provided in the Resolution. In case any provision in this Bond or any
application thereof shall be invalid, illegal, or unenforceable, the validity, legality, and
enforceability of the remaining provisions and applications shall not in any way be affected or
impaired thereby. The terms and provisions of this Bond and the Resolution shall be construed
in accordance with and shall be governed by the laws of the State of Texas.
77339817.3/11112133 11
IN WITNESS WHEREOF, the Board of Directors of the Corporation has caused this
Bond to be duly executed under the official seal of the Corporation as of the Bond Date.
EULESS DEVELOPMENT CORPORATION
ATTEST: President
Secretary
(Corporate Seal)
(c) Form of Registration Certificate of Comptroller of Public Accounts to Appear on
Initial Bond(s)only.
REGISTRATION CERTIFICATE OF
COMPTROLLER OF PUBLIC ACCOUNTS
OFFICE OF THE COMPTROLLER )
OF PUBLIC ACCOUNTS ) REGISTER NO.
THE STATE OF TEXAS )
I HEREBY CERTIFY that this Bond has been examined, certified as to validity and
approved by the Attorney General of the State of Texas, and duly registered by the Comptroller
of Public Accounts of the State of Texas.
WITNESS my signature and seal of office this
Comptroller of Public Accounts
(SEAL) of the State of Texas
77339817.3/11112133 12
(d) Form of Certificate of Paying Agent/Registrar to Appear on definitive Bonds.
REGISTRATION CERTIFICATE OF PAYING AGENT/REGISTRAR
This Bond has been duly issued and registered in the name of the Registered Owner
shown above under the provisions of the within-mentioned Resolution and duly approved, or a
Predecessor Bond hereof duly approved, by the Attorney General of the State of Texas and
registered by the Comptroller of Public Accounts, as shown by,the records of the Paying
Agent/Registrar.
The designated offices of the Paying Agent/Registrar located in Fort Worth,Texas, is the
"Designated Payment/Transfer Office"for this Bond.
BOKF,NA DBA BANK OF TEXAS,
Fort Worth,Texas,
as Paying Agent/Registrar
Registration date:
By:
Authorized Signature
(e) Form of Assignment.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells,assigns, and transfers unto (Print
or typewrite name,address, and zip code of transferee:)
(Social Security or other identifying number:
) the within Bond and all rights thereunder, and hereby
irrevocably constitutes and appoints
attorney to transfer the within Bond on the books kept for registration thereof,with full power of
substitution in the premises.
DATED:
NOTICE: The signature on this assignment must
Signature guaranteed: correspond with the name of the registered owner
as it appears on the face of the within Bond in
every particular.
Ili
77339817.3/11112133 13
(f) The Initial Bond(s) shall be in the form set forth in subsection (b) of this Section,
except that the heading and paragraph one of the form of the single fully registered Initial Bond
shall be modified as follows:
REGISTERED REGISTERED
NO. T-1 $3,785,000
UNITED STATES OF AMERICA
STATE OF TEXAS
EULESS DEVELOPMENT CORPORATION
SALES TAX REVENUE REFUNDING BOND
SERIES 2012
Bond Date: January 1,2012
Registered Owner:
Principal Amount: THREE MILLION SEVEN HUNDRED EIGHTY-FIVE THOUSAND DOLLARS
The Euless Development Corporation (hereinafter referred to as the "Corporation"), a
nonprofit industrial development corporation organized and existing under the laws of the State
of Texas, including the Act, with its principal office located in Tarrant County, Texas, for value
received, acknowledges itself indebted to and hereby promises to pay to the Registered Owner
named above, or the registered assigns thereof, the Principal Amount hereinabove stated on
September 15 in each of the years and in principal installments in accordance with the following
schedule:
STATED PRINCIPAL INTEREST
MATURITY INSTALLMENTS RATE
(Information to be inserted from schedule in Section 2 hereof).
(or so much principal thereof as shall not have been redeemed prior to maturity) and to pay
interest on the unpaid principal installments hereof from the date of delivery to the initial
purchasers(January 12, 2012)at the per annum rates of interest specified above computed on the
basis of a 360-day year of twelve 30 day months; such interest being payable on March 15 and
September 15 in each year, commencing September 15,2012,until maturity or prior redemption.
Principal installments of this Bond are payable on the Stated Maturity dates or on a redemption
date to the registered owner hereof by BOKF, NA dba Bank of Texas, Fort Worth, Texas (the
"Paying Agent/Registrar"), upon its presentation and surrender at its designated offices, initially
in Fort Worth, Texas, or, with respect to a successor paying agent/registrar, at the designated
office of such successor (the "Designated Payment/Transfer Office"). Interest is payable to the
registered owner of this Bond whose name appears on the"Security Register"maintained by the
Paying Agent/Registrar at the close of business on the "Record Date", which is the last business
day of the month next preceding each interest payment date, and interest shall be paid by the
Paying Agent/Registrar by check sent United States Mail, first class postage prepaid, to the
address of the registered owner recorded in the Security Register or by such other method,
acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the
registered owner. If the date for the payment of the principal of or interest on the Bonds shall be
77339817.3/11112133 14
a Saturday, Sunday, a legal holiday, or a day when banking institutions in the city where the
Designated Payment/Transfer Office of the Paying Agent/Registrar is located are authorized by
law or executive order to close, then the date for such payment shall be the next succeeding day
which is not such a Saturday, Sunday, legal holiday, or day when banking institutions are
authorized to close; and payment on such date shall have the same force and effect as if made on
the original date payment was due. All payments of principal of, premium, if any, and interest
on this Bond shall be without exchange or collection charges to the owner hereof and in any coin
or currency of the United States of America which at the time of payment is legal tender for the
payment of public and private debts.
SECTION 9. Definitions. For all purposes of this Resolution and in particular for clarity
with respect to the issuance of the Bonds herein authorized and the pledge and appropriation of
revenues to the payment of the Bonds,the following definitions are provided:
"Act" - the Development Corporation Act, V.T.C.A., Local Government
Code, Title 12, Subtitle C 1, as amended, specifically Chapters 501 and 505 of the
Local Government Code, as amended at any time.
"Additional Obligations" - Bonds, notes or other evidences of
indebtedness which the Corporation reserves the right to issue or enter into, as the
case may be, in the future in accordance with the terms and conditions provided in
Section 17 hereof and which, together with the Bonds, are equally and ratably
secured by a parity pledge of and claim on the Pledged Revenues under the terms
of this Resolution and a Supplemental Resolution.
"Average Annual Debt Service" - That amount which, at the time of
computation, is derived by dividing the total amount of Debt Service to be paid
over a period of years as the same is scheduled to become due and payable by the
number of years taken into account in determining the total Debt Service.
Capitalized interest payments provided from proceeds of a borrowing of the
Corporation shall be excluded in making the aforementioned computation.
"Board"-The Board of Directors of the Corporation.
"Bonds" - The "Euless Development Corporation Sales Tax Revenue
Refunding Bonds, Series 2012", dated January 1, 2012, authorized by this
Resolution.
"City"-The City of Euless,Texas.
"Corporation" - The Euless Development Corporation, a nonprofit
industrial development corporation organized and existing under and pursuant to
the laws of the State of Texas,including the Act and on behalf of the City.
"Debt Service" - As of any particular date of computation, with respect to
any obligations and with respect to any period,the aggregate of the amounts to be
paid or set aside by the Corporation as of such date or in such period for the
payment of the principal of, premium, if any, and interest (to the extent not
77339817.3/11112133 15
capitalized) on such obligations; assuming, in the case of obligations without a
fixed numerical rate, that such obligations bear, or would have borne, interest at
the maximum legal per annum rate applicable to such obligations, and further
assuming in the case of obligations required to be redeemed or prepaid as to
principal prior to maturity, the principal amounts thereof will be redeemed prior
to maturity in accordance with the mandatory redemption provisions applicable
thereto.
"Depository" - A commercial bank or other qualified financial institution
eligible and qualified to serve as the custodian of the Corporation's monetary
accounts and funds.
"Fiscal Year" - The twelve month financial accounting period used by the
Corporation ending September 30 in each year, or such other twelve consecutive
month period established by the Corporation.
"Government Obligations" - (i) direct noncallable 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, (ii)
noncallable obligations of an agency or instrumentality of the United States,
including obligations unconditionally guaranteed or insured by the agency or
instrumentality and, on the date of their acquisition or purchase by the
Corporation, are rated as to investment quality by a nationally recognized
investment rating firm not less than AAA or its equivalent, (iii) noncallable
obligations of a state or an agency or a county, municipality, or other political
subdivision of a state that have been refunded and that, on the date of their
acquisition or purchase by the Corporation, are rated as to investment quality by a
nationally recognized investment rating firm not less than AAA or its equivalent,
and (iv) any other then authorized securities or obligations that may be used to
defease obligations such as the Bonds under the then applicable laws of the State
of Texas.
"Gross Sales Tax Revenues" -All of the revenues or receipts due or owing
to, or collected or received by or on behalf of the Corporation by the City or
otherwise pursuant to the Act and the election held January 16, 1993, less any
amounts due and owed to the Comptroller of Public Accounts of the State of
Texas as charges for the collection of the Sales Tax or retention by said
Comptroller for refunds and to redeem dishonored checks and drafts, to the extent
such charges and retention are authorized or required by law.
"Outstanding" - When used in this Resolution with respect to Bonds or
Parity Obligations, as the case may be, means, as of the date of determination, all
Bonds and Parity Obligations theretofore sold, issued and delivered by the
Corporation,except:
77339817.3/11112133 16
(i) those Bonds or Parity Obligations canceled or
delivered to the transfer agent or registrar for cancellation in
connection with the exchange or transfer of such obligations;
(ii) those Bonds or Parity Obligations paid or deemed to
be paid in accordance with the provisions of Section 23 hereof or
similar provisions of any Supplemental Resolution authorizing the
issuance of Additional Obligations.
(iii) those Bonds or Parity Obligations that have been
mutilated, destroyed, lost, or stolen and replacement obligations
have been registered and delivered in lieu thereof.
"Parity Obligations"-Collectively,the Bonds and Additional Obligations.
"Pledged Revenues" - Collectively (i) Gross Sales Tax Revenues from
time to time deposited or owing to the Pledged Revenue Fund and (ii) such other
money, income, revenue, receipts or other property as may be specifically
dedicated, pledged or otherwise encumbered in a Supplemental Resolution for the
payment and security of Parity Obligations.
"Required Reserve" - The amount required to be accumulated and
maintained in the Reserve Fund under the provisions of Section 13 hereof.
"Sales Tax" - The local sales and use tax authorized under the Act,
approved at an election held on January 16, 1993, and the effective date for the
imposition and application of such Sales Tax within the corporate limits of the
City by the Comptroller of Public Accounts of the State of Texas being July 1,
1993, together with any increases in the rate of such Sales Tax authorized and
provided by law.
"Supplemental Resolution" - Any resolution of the Board supplementing
this Resolution for the purpose of authorizing and providing the terms and
provisions of the Bonds or Additional Obligations, or supplementing or amending
this Resolution for any other authorized purpose permitted'in Section 17 or 24
hereof,including resolutions authorizing the issuance of Additional Obligations or
pledging and encumbering income, revenues, receipts or property other than the
Gross Sales Tax Revenues to the payment and security of the Parity Obligations.
SECTION 10. Pledge. The Corporation hereby covenants and agrees that the Pledged
Revenues, with the exception of those in excess of the amounts required for the payment and
security of the Parity Obligations, are hereby irrevocably pledged to the payment and security of
the Bonds and Additional Obligations, if issued, including the establishment and maintenance of
the special funds created and established in this Resolution and any Supplemental Resolution, all
as hereinafter provided. The Corporation hereby resolves that the Parity Obligations shall
constitute a lien on the Pledged Revenues in accordance with the terms of this Resolution and
any Supplemental Resolution, which lien shall be valid and binding and fully perfected from and
after the date of adoption of this Resolution without physical delivery or transfer or transfer of
77339817.3/11112133 17
control of the Pledged Revenues,the filing of this Resolution or any other act; all as provided in
Chapter 1208 of the Texas Government Code,as amended("Chapter 1208").
Chapter 1208 applies to the issuance of the Bonds and the pledge of the Pledged
Revenues granted by the Corporation under this Section 10, and such pledge is therefore valid,
effective and perfected. If Texas law is amended at any time while the Bonds are Outstanding
such that the pledge of the Pledged Revenues granted by the Corporation under this Section 10 is
to be subject to the filing requirements of Chapter 9, Business and Commerce Code, then in
order to preserve to the registered owners of the Bonds the perfection of the security interest in
said pledge, the Corporation agrees to take such measures as it determines are reasonable and
necessary under Texas law to comply with the applicable provisions of Chapter 9, Business and
Commerce Code and enable a filing to perfect the security interest in said pledge to occur.
SECTION 11. Pledged Revenue Fund. The Corporation hereby agrees and covenants to
establish and maintain a fund or account at a Depository for the deposit of the Pledged Revenues
as received by the Corporation, which fund or account shall be known on the books and records
of the Corporation as the "Pledged Revenue Fund". All Pledged Revenues deposited to the
credit of such Fund shall be accounted for separate and apart from all other revenues, receipts
and income of the Corporation and, with respect to the Gross Sales Tax Revenues, the
Corporation shall further account for such funds separate and apart from the other Pledged
Revenues deposited to the credit of the Pledged Revenue Fund. All Pledged Revenues deposited
to the credit of the Pledged Revenue Fund shall be appropriated and expended to the extent
required by this Resolution and any Supplemental Resolution for the following uses and in the
order of priority shown:
First: To the payment of the amounts required to be deposited in the Bond
Fund for the payment of Debt Service on the Parity Obligations as the same
becomes due and payable;
Second: To the payment of the amounts required to be deposited in the
Reserve Fund to establish and maintain the Required Reserve in accordance with
the provisions of this Resolution and any Supplemental Resolution;
Third: To the payment of amounts required to be deposited in any other
fund or account required by any Supplemental Resolution authorizing the
issuance of Parity Obligations;and
Fourth: To any fund or account held at any place or places, or to any
payee, required by any other resolution of the Board which authorized the
issuance of obligations or the creation of debt of the Corporation having a lien on
the Pledged Revenues subordinate to the lien created herein on behalf of the
Parity Obligations.
Any Pledged Revenues remaining in the Pledged Revenue Fund after satisfying the
foregoing payments, or making adequate and sufficient provision for the payment thereof, may
be appropriated and used for any other lawful purpose now or hereafter permitted by law.
77339817.3/11112133 18
SECTION 12. Bond Fund. For the purpose of providing funds to pay the principal of
and interest on Parity Obligations, the Corporation agrees and covenants to maintain a separate
and special account or fund on the books and records of the Corporation known as the "Euless
Development Corporation Debt Service Account" (the "Bond Fund"), and all monies deposited
to the credit of such Fund shall be held in a special banking fund or account maintained at a
Depository of the Corporation. The Corporation covenants there shall be deposited into the
Bond Fund prior to each principal and interest payment date from the Pledged Revenues an
amount equal to one hundred per centum(100%) of the interest on and the principal of the Bonds
then falling due and payable, and such deposits to pay principal and accrued interest on the
Bonds shall be made in substantially equal monthly installments on or before the 20th day of
each month,beginning on or before March 20,2012.
The required deposits to the Bond Fund for the payment of principal of and interest on
the Bonds shall continue to be made as hereinabove provided until(i)the total amount on deposit
in the Bond Fund and Reserve Fund is equal to the amount required to fully pay and discharge all
Parity Obligations (principal and interest) then Outstanding or (ii) the Bonds are no longer
Outstanding.
SECTION 13. Reserve Fund. The Corporation agrees and covenants to maintain on the
books and records of the Corporation a separate and special fund or account to be known as the
"Reserve Account" (the"Reserve Fund"),which fund or account shall be a special banking fund
maintained at the Paying Agent/Registrar. All Pledged Revenues deposited to the credit of such
fund or account shall be used solely for the payment of the principal of and interest on the Parity
Obligations when (whether at maturity, upon a redemption date or any interest payment date)
other funds available for such purposes are insufficient, and, in addition, may be used to the
extent not required to maintain the "Required Reserve", to pay, or provide for the payment of,
the final principal amount of a series of Parity Obligations so that such series of Parity
Obligations is no longer deemed to be"Outstanding"as such term is defined herein.
There is currently on deposit to the credit of the Reserve Fund the sum of$938,998.00
(the "Current Reserve"). By reason of the issuance of the Bonds, the total amount required to be
accumulated and maintained in the Reserve Fund is hereby redetermined and calculated to be
$911,534.72 (the "Required Reserve"). The Required Reserve is less than the Current Reserve
and, therefore, no additional deposits to the Reserve Fund are required by reason of the issuance
of the Bonds.
As and when Additional Obligations are delivered or incurred, the Required Reserve
shall be increased, if required,to an amount equal to the lesser of either(i)the maximum annual
Debt Service(calculated on a Fiscal Year basis)for all Parity Obligations then Outstanding(after
giving effect to the issuance of the Additional Obligations), as determined on the date each series
of Additional Obligations are delivered or incurred, as the case may be, or (ii) the maximum
amount that can be invested without restriction as to yield in a reasonably required reserve fund
pursuant to Subsection (d) of Section 148 of the Internal Revenue Code of 1986, as amended,
and regulations promulgated thereunder. Any additional amount required to be accumulated and
maintained in the Reserve Fund shall be accumulated by the deposit to the credit of the Reserve
Fund of all or any part in cash immediately after the delivery of the then proposed Additional
Obligations, or, at the option of the Corporation,by the deposit of monthly installments,made on
77339817.3/11112133 19
or before the 20th day of each month following the month of delivery of the then proposed
Additional Obligations, of not less than 1/36th of the additional amount to be maintained in said
Fund by reason of the issuance of the Additional Obligations then being issued (or 1/36th of the
balance of the additional amount not deposited immediately in cash).
The Corporation may, at its option, from time to time, recalculate the maximum annual
Debt Service for all Parity Obligations then Outstanding as of the date of such calculation and
determine a new Required Reserve as of such date.
While the cash and investments in the Reserve Fund total not less than the Required
Reserve, no deposits need be made to the credit of the Reserve Fund; but, if and when the
Reserve Fund at any time contains less than the Required Reserve, the Corporation covenants
and agrees to cure the deficiency in the Required Reserve by resuming monthly deposits to said
Fund from the Pledged Revenues; such monthly deposits to be in amounts equal to not less than
1/36th of the then total Required Reserve to be maintained in said`:Fund and to be made on or
before the 20th day of each month until the total Required Reserve then required to be
maintained in said Fund has been fully restored. The Corporation further covenants and agrees
that the Pledged Revenues shall be applied and appropriated and used to establish and maintain
the Required Reserve and to cure any deficiency in such amounts as required by the terms of this
Resolution and any Supplemental Resolution.
During such time as the Reserve Fund contains the total Required Reserve, the
Corporation may, at its option, withdraw all surplus in the Reserve Fund in excess of the
Required Reserve and deposit such surplus in the Pledged Revenue Fund.
SECTION 14. Deficiencies. If on any occasion there shall not be sufficient Pledged
Revenues to make the required deposits into the Bond Fund or Reserve Fund, such deficiency
shall be cured as soon as possible from the next available Pledged Revenues, or from any other
sources available for such purpose.
SECTION 15.Payment of Bonds. While any of the Bonds are Outstanding, the Treasurer
of the Corporation (or other designated financial officer of the Corporation) shall cause to be
transferred to the Paying Agent/Registrar, from funds on deposit in the Bond Fund, and, if
necessary, in the Reserve Fund, amounts sufficient to fully pay and discharge promptly as each
installment of interest and principal of the Bonds accrues or matures; such transfer of funds to be
made in such manner as will cause immediately available funds to be deposited with the Paying
Agent/Registrar for the Bonds at the close of the business day next preceding the date of
payment for the Bonds.
SECTION 16.Investments - Security of Funds. (a) Money in any Fund required to be
maintained pursuant to this Resolution may, at the option of the Corporation, be invested in
obligations and in the manner prescribed by the Public Funds Investment Act of 1987
(V.T.C.A., Government Code, Chapter 2256), including investments held in book entry form;
provided that all such deposits and investments shall be made in such a manner that the money
required to be expended from any Fund will be available at the proper time or times and
provided further the maximum stated maturity for any investment acquired with money
deposited to the credit of the Reserve Fund shall be limited to five (5) years from the date of the
77339817.3/11112133 20
investment of such money. Such investments shall be valued in terms of current market value
within 45 days of the close of each Fiscal Year and, with respect to investments held for the
account of the Reserve Fund,within 45 days of the date of passage of each authorizing document
of the Board pertaining to the issuance of Additional Obligations. All interest and income
derived from deposits and investments in the Bond Fund immediately shall be credited to, and
any losses debited to,the appropriate account of the Bond Fund. All interest and interest income
derived from deposits in and investments of the Reserve Fund shall, subject to the limitations
provided in Section 13 hereof, be credited to and deposited in the Pledged Revenue Fund. All
such investments shall be sold promptly when necessary to prevent any default in connection
with the Parity Obligations.
(b) Money deposited to the credit of the Pledged Revenue Fund, Bond Fund and
Reserve Fund, to the extent not invested and not otherwise insured by the Federal Deposit
Insurance Corporation or similar agency, shall be secured by a pledge of direct obligations of the
United States of America, or obligations unconditionally guaranteed by the United States of
America.
SECTION 17. Issuance of Additional Obligations. Subject to the provisions hereinafter
appearing as to conditions precedent which must be satisfied, the Corporation reserves the right
to issue, from time to time as needed, Additional Obligations for any lawful purpose. Such
Additional Obligations may be issued in such form and manner as the Corporation shall
determine, provided, however, prior to issuing or incurring such Additional Obligations, the
following conditions precedent for the authorization and issuance of the same are satisfied, to
wit:
(1) The Treasurer of the Corporation (or other officer of the Corporation
then having the primary responsibility for the financial affairs of the Corporation)
shall have executed a certificate stating that, to the best of his or her knowledge
and belief, the Corporation is not then in default as to any covenant, obligation or
agreement contained in this Resolution or a Supplemental Resolution.
(2) The Corporation has secured from a certified public accountant a
certificate or opinion to the effect that, according to the books and records of the
Corporation,the Gross Sales Tax Revenues received by the Corporation for either
(i)the last completed Fiscal Year next preceding the adoption of the Supplemental
Resolution authorizing the issuance of the proposed Additional Obligations or
(ii) any twelve (12) consecutive months out of the previous eighteen (18) months
next preceding the adoption of the Supplemental Resolution authorizing the
Additional Obligations were equal to not less than (i) 1.50 times the Average
Annual Debt Service for all Parity Obligations then Outstanding after giving
effect to the issuance of the Additional Obligations then being issued and(ii) 1.35
times the maximum annual Debt Service for all Parity Obligations then
Outstanding after giving effect to the issuance of the Additional Obligations then
being issued.
(3) The Required Reserve to be accumulated and maintained in the
Reserve Fund is increased to the extent required by Section 13.
77339817.3/11112133 21
SECTION 18. Refunding Bonds. The Corporation reserves the right to issue refunding
bonds to refund all or any part of the Parity Obligations (pursuant to any law then available)
upon such terms and conditions as the Board may deem to be in the best interest of the
Corporation, and if less than all such Parity Obligations then Outstanding are refunded, the
conditions precedent prescribed (for the issuance of Additional Obligations) set forth in
Section 17 hereof shall be satisfied, and shall give effect to the refunding.
SECTION 19. Right to Create Reserve Fund: Subordinate Lien Debt. The Corporation
may establish and maintain a reserve fund for the benefit and security of the Bonds and any
series of Additional Obligations as the Corporation shall determine in any Supplemental
Resolution.
Except as may be limited by a Supplemental Resolution, the Corporation shall have the
right to issue or create any debt payable from or secured by a lien on all or any part of the
Pledged Revenues for any lawful purpose without complying with the provisions of Section 17
or 18 hereof,provided the pledge and the lien securing such debt is subordinate to the pledge and
lien established, made and created in Section 10 of this Resolution with respect to the Pledged
Revenues to the payment and security of the Parity Obligations.
SECTION 20. Confirmation and Levy of Sales Tax.
(a) The Board hereby represents the City has duly complied with the provisions of the
Act for the levy of the Sales Tax at the rate voted at the election held by and within the City on
January 16, 1993, and such Sales Tax is being imposed within the corporate limits of the City
and the receipts of such Sales Tax are being remitted to the City by the Comptroller of Public
Accounts on a monthly basis.
(b) While any Bonds are Outstanding, the Corporation covenants, agrees and warrants
to take and pursue all action permissible to cause the Sales Tax, at said rate or at a higher rate if
legally permitted, to be levied and collected continuously, in the manner and to the maximum
extent permitted by law, and to cause no reduction, abatement or exemption in the Sales Tax or
rate of tax below the rate stated, confirmed and ordered in subsection (a) of this Section to be
ordered or permitted while any Bonds shall remain Outstanding.
(c) If hereafter authorized by law to apply, impose and levy the Sales Tax on any
taxable items or transactions that are not subject to the Sales Tax on the date of the adoption
hereof, to the extent it legally may do so, the Corporation agrees to use its best efforts to cause
the City to take such action as may be required to subject such taxable items or transactions to
the Sales Tax.
(d) The Corporation agrees to take and pursue all action legally permissible to cause the
Sales Tax to be collected and remitted and deposited as herein required and as required by the
Act,at the earliest and most frequent times permitted by law.
(e) The Corporation agrees to use its best efforts to cause the City to comply with the
Act and shall cause the Gross Sales Tax Revenues to be deposited to the credit of the Pledged
Revenue Fund in their entirety immediately upon receipt by the City. In the alternative and if
legally authorized, the Corporation shall, by appropriate notice, direction, request or other legal
77339817.3/11112133 22
method, use its good-faith efforts to cause the Comptroller of Public Accounts of the State of
Texas (the "Comptroller") to pay all Gross Sales Tax Revenues directly to the Corporation for
deposit to the Pledged Revenue Fund.
SECTION 21. Records and Accounts. The Corporation hereby covenants and agrees
that while any of the Bonds are Outstanding, it will keep and maintain complete records and
accounts in accordance with generally accepted accounting principles, and following the close of
each Fiscal Year, it will cause an audit of such books and accounts to be made by an independent
firm of certified public accountants. Each such audit, in addition to'whatever other matters may
be thought proper by the accountant, shall particularly include the following:
(1) A statement in reasonable detail regarding the receipt and
disbursement of the Pledged Revenues for such Fiscal Year; and
(2) A balance sheet for the Corporation as of the end of such Fiscal Year.
Such annual audit of the records and accounts of the Corporation shall be in the form of a
report and be accompanied by an opinion of the accountant to the effect that such examination
was made in accordance with generally accepted auditing standards and contain a statement to
the effect that in the course of making the examination necessary for the report and opinion, the
accountant obtained no knowledge of any default of the Corporation on the Bonds or in the
fulfillment of any of the terms, covenants or provisions of this Resolution, or under any other
evidence of indebtedness, or of any event which, with notice or lapse of time, or both, would
constitute a failure of the Corporation to comply with the provisions of this Resolution or if, in
the opinion of the accountants, any such failure to comply with a covenant or agreement hereof,
a statement as to the nature and status thereof shall be included.
Copies of each annual audit report shall be furnished upon written request,to any Holders
of any of said Bonds. The audits herein required shall be made within 120 days following the
close of each Fiscal Year insofar as is possible.
The Holders of any Bonds or any duly authorized agent or agents of such Holders shall
have the right to inspect such records, accounts and data of the Corporation during regular
business hours.
SECTION 22. Representations as to Security for the Bonds. •
(a) The Corporation represents and warrants that, except for the Parity Obligations, the
Pledged Revenues are and will be and remain free and clear of any pledge, lien, charge or
encumbrance thereon or with respect thereto prior to, or of equal rank with, the pledge and lien
created in or authorized by this Resolution except as expressly provided herein.
(b) The Bonds and the provisions of this Resolution are and will be the valid and legally
enforceable obligations of the Corporation in accordance with their terms and the terms of this
Resolution, subject only to any applicable bankruptcy or insolvency laws or to any laws
affecting creditors rights generally.
77339817.3/11112133 23
(c) The Corporation shall at all times, to the extent permitted by law, defend, preserve
and protect the pledge of the Pledged Revenues and all the rights of the Holders against all
claims and demands of all persons whomsoever.
(d) The Corporation will take, and use its best efforts to cause the City to take, all steps
reasonably necessary and appropriate to collect all delinquencies in the collection of the Sales
Tax to the fullest extent permitted by the Act.
(e) The provisions, covenants, pledge and lien on and against the Pledged Revenues, as
herein set forth, are established and shall be for the equal benefit, protection and security of the
owners and holders of Parity Obligations without distinction as to priority and rights under this
Resolution.
(f) The Parity Obligations shall constitute special obligations of the Corporation,
payable solely from, and equally and ratably secured by a parity. pledge of and lien on, the
Pledged Revenues, and not from any other revenues, properties or income of the Corporation.
The Bonds may not be paid in whole or in part from any property taxes raised or to be raised by
the City and shall not constitute debts or obligations of the State or of the City, and the Holders,
shall never have the right to demand payment out of any funds raised or to be raised by any
system of ad valorem taxation.
SECTION 23. Satisfaction of Obligation of Corporation. If the Corporation shall pay or
cause to be paid, or there shall otherwise be paid to the Holders, the principal of, premium, if
any, and interest on the Bonds, at the times and in the manner stipulated in this Resolution, then
the pledge of the Pledged Revenues under this Resolution and all other obligations of the
Corporation to the Holders shall thereupon cease,terminate,and be discharged and satisfied.
Bonds or any principal amount(s) shall be deemed to have been paid within the meaning
and with the effect expressed above in this Section when(i) money sufficient to pay in full such
Bonds at maturity or to the redemption date therefor, together with all interest due thereon, shall
have been irrevocably deposited with and held in trust by the Paying Agent/Registrar, or an
authorized escrow agent, or (ii) Government Obligations shall have been irrevocably deposited
in trust with the Paying Agent/Registrar, or an authorized escrow agent, which Government
Obligations have been certified by an independent accounting firm to mature as to principal and
interest in such amounts and at such times as will insure the availability,without reinvestment,of
sufficient money, together with any moneys deposited therewith, if any, to pay when due the
Bonds on the Stated Maturity thereof or(if notice of redemption has been duly given or waived
or if irrevocable arrangements therefor accepted to the Paying Agent/Registrar have been made)
the redemption date thereof. The Corporation covenants that no deposit of moneys or
Government Obligations will be made under this Section and no use made of any such deposit
which would cause the Bonds to be treated as "arbitrage bonds" within the meaning of
Section 148 of the Internal Revenue Code of 1986, as amended, or regulations adopted pursuant
thereto.
Any moneys so deposited with the Paying Agent/Registrar, or an authorized escrow
agent, and all income from Government Obligations held in trust by the Paying Agent/Registrar,
or an authorized escrow agent, pursuant to this Section in excess of the amount required for the
77339817.3/11112133 24
payment of the Bonds shall be remitted to the Corporation or deposited as directed by the
Corporation. Furthermore,any money held by the Paying Agent/Registrar for the payment of the
principal of and interest on the Bonds and remaining unclaimed for a period of three (3) years
after the Stated Maturity, or applicable redemption date, of the Bonds such moneys were
deposited and are held in trust to pay shall, upon the request of the Corporation, be remitted to
the Corporation against a written receipt therefor. Notwithstanding the above and foregoing, any
remittance of funds from the Paying Agent/Registrar to the Corporation shall be subject to any
applicable unclaimed property laws of the State of Texas.
SECTION 24. Resolution a Contract - Amendments. This Resolution shall constitute a
contract with the Holders from time to time, be binding on the Corporation, and shall not be
amended or repealed by the Corporation while any Bond remains Outstanding except as
permitted in this Section. The Corporation,may,without the consent of or notice to any Holders,
from time to time and at any time, amend this Resolution in any manner not detrimental to the
interests of the Holders, including the curing of any ambiguity, inconsistency, or formal defect or
omission herein. In addition, the Corporation may, with the written consent from the owners
holding a majority in aggregate principal amount of the Parity Obligations then Outstanding
affected thereby, amend, add to, or rescind any of the provisions of this Resolution; provided
that, without the written consent of all Holders of Outstanding Bonds effected, no such
amendment, addition, or rescission shall (1) extend the time or times of payment of the
principal of, premium, if any, and interest on the Bonds, reduce the principal amount thereof,
the redemption price therefor, or the rate of interest thereon, or in any other way modify the
terms of payment of the principal of, premium, if any, or interest on the Bonds, (2) give any
preference to any Bond over any other Bond, or (3) reduce the aggregate principal amount of
Bonds or Parity Obligations, as the case may be, required to be held for consent to any such
amendment,addition,or rescission.
SECTION 25. Mutilated, Destroyed, Lost and Stolen Bonds. In case any Bond shall be
mutilated, or destroyed, lost or stolen, the Paying Agent/Registrarr may execute and deliver a
replacement Bond of like form and tenor, and in the same denomination and bearing a number
not contemporaneously outstanding, in exchange and substitution for such mutilated Bond, or in
lieu of and in substitution for such destroyed, lost or stolen Bond, only upon the approval of the
Corporation and after (i) the filing by the Holder thereof with the Paying Agent/Registrar of
evidence satisfactory to the Paying Agent/Registrar of the destruction, loss or theft of such Bond,
and of the authenticity of the ownership thereof and (ii) the furnishing to the Paying
Agent/Registrar of indemnification in an amount satisfactory to hold the Corporation and the
Paying Agent/Registrar harmless. All expenses and charges associated with such indemnity and
with the preparation, execution and delivery of a replacement Bond shall be borne by the Holder
of the Bond mutilated,or destroyed, lost or stolen.
Every new Bond issued pursuant to this Section in lieu of any mutilated, destroyed, lost,
or stolen Bond shall constitute a replacement of the prior obligation of the Corporation, whether
or not the mutilated, destroyed, lost, or stolen Bond shall be at any time enforceable by anyone,
and shall be entitled to all the benefits of this Resolution equally and ratably with all other
Outstanding Bonds.
77339817.3/11112133 25
SECTION 26. Covenants Regarding Tax-Exempt Status.
(a) Definitions. When used in this Section, the following terms have the following
meanings:
"Closing Date" means the date on which the Bonds are first authenticated
and delivered to the initial purchasers against payment therefor.
"Code" means the Internal Revenue Code of 1986; as amended by all
legislation,if any, effective on or before the Closing Date.
"Computation Date"has the meaning set forth in Section 1.148-1(b)of the
Regulations.
"Gross Proceeds" means any proceeds as defined in Section 1.148-1(b) of
the Regulations, and any replacement proceeds as defined in Section 1.148-1(c)of
the Regulations,of the Bonds.
"Investment" has the meaning set forth in Section 1.148-1(b) of the
Regulations.
"Nonpurpose Investment" means any investment property, as defined in
section 148(b) of the Code, in which Gross Proceeds of the Bonds are invested
and which is not acquired to carry out the governmental purposes of the Bonds.
"Rebate Amount" has the meaning set forth in Section 1.148-1(b) of the
Regulations.
"Regulations" means any proposed, temporary, or. final Income Tax
Regulations issued pursuant to Sections 103 and 141 through 150 of the Code,
and 103 of the Internal Revenue Code of 1954, which are applicable to the Bonds.
Any reference to any specific Regulation shall also mean, as appropriate, any
proposed, temporary or final Income Tax Regulation designed to supplement,
amend or replace the specific Regulation referenced.
"Yield"of(1)any Investment has the meaning set forth in Section 1.148-5
of the Regulations and(2)the Bonds has the meaning set forth in Section 1.148-4
of the Regulations.
(b) Not to Cause Interest to Become Taxable. The Corporation shall not use,permit the
use of, or omit to use Gross Proceeds or any other amounts (or any property the acquisition,
construction or improvement of which is to be financed directly or indirectly with Gross
Proceeds) in a manner which if made or omitted, respectively, would cause the interest on any
Bond to become includable in the gross income, as defined in section 61 of the Code, of the
owner thereof for federal income tax purposes. Without limiting the generality of the foregoing,
unless and until the Corporation receives a written opinion of counsel nationally recognized in
the field of municipal bond law to the effect that failure to comply with such covenant will not
77339817.3/11112133 26
adversely affect the exemption from federal income tax of the interest on any Bond, the
Corporation shall comply with each of the specific covenants in this,Section.
(c) No Private Use or Private Payments. The Bonds are being issued to finance the
costs of the Project for and on behalf of the City, a political subdivision of the State of Texas
and, in connection therewith, the City and the Corporation will execute an agreement relating to
the ownership, operation and maintenance of the Projects while the Bonds are outstanding and
unpaid, which agreement provides that, except as permitted by section 141 of the Code and the
Regulations and rulings thereunder, the Projects shall at all times prior to the last Stated
Maturity of Bonds:
(1) be exclusively owned, operated and maintained by the City, and
prohibits the City from using or permitting the use of such Gross Proceeds or any
property acquired, constructed or improved with such Gross.Proceeds (including
property financed with Gross Proceeds of the Refunded Bonds) in any activity
carried on by any person or entity other than a state or local government, unless
such use is solely as a member of the general public;and
(2) prohibits the City from directly or indirectly imposing or accepting
any charge or other payment for use of Gross Proceeds of the Bonds or for any
property the acquisition, construction or improvement of which is to be financed
or refinanced directly or indirectly with such Gross Proceeds (including property
financed with Gross Proceeds of the Refunded Bonds), other than taxes of general
application within the City or interest earned on investments acquired with such
Gross Proceeds pending application for their intended purposes.
(d) No Private Loan. Except to the extent permitted by section 141 of the Code and the
Regulations and rulings thereunder, the Corporation shall not use Gross Proceeds of the Bonds
to make or fmance loans to any person or entity other than a state or local government. For
purposes of the foregoing covenant, such Gross Proceeds are considered to be "loaned" to a
person or entity if: (1)property acquired, constructed or improved with such Gross Proceeds is
sold or leased to such person or entity in a transaction which creates a debt for federal income
tax purposes; (2) capacity in or service from such property is committed to such person or entity
under a take-or-pay, output or similar contract or arrangement; or (3) indirect benefits, or
burdens and benefits of ownership, of such Gross Proceeds or any property acquired,
constructed or improved with such Gross Proceeds are otherwise transferred in a transaction
which is the economic equivalent of a loan.
(e) Not to Invest at Higher Yield. Except to the extent permitted by section 148 of the
Code and the Regulations and rulings thereunder, the Corporation shall not at any time prior to
the final Stated Maturity of the Bonds directly or indirectly invest Gross Proceeds in any
Investment (or use Gross Proceeds to replace money so invested), if as a result of such
investment the Yield from the Closing Date of all Investments acquired with Gross Proceeds (or
with money replaced thereby), whether then held or previously disposed of, exceeds the Yield
of the Bonds.
77339817.3/11112133 27
(f) Not Federally Guaranteed. Except to the extent permitted by section 149(b) of the
Code and the Regulations and rulings thereunder, the Corporation shall not take or omit to take
any action which would cause the Bonds to be federally guaranteed within the meaning of
section 149(b)of the Code and the Regulations and rulings thereunder.
(g) Information Report. The Corporation shall timely file the information required by
section 149(e) of the Code with the Secretary of the Treasury on Form 8038-G or such other
form and in such place as the Secretary may prescribe.
(h) Rebate of Arbitrage Profits. Except to the extent otherwise provided in section
148(f)of the Code and the Regulations and rulings thereunder:
(1) The Corporation and the City shall account for all Gross Proceeds
(including all receipts, expenditures and investments thereof) on its books of
account separately and apart from all other funds (and receipts, expenditures and
investments thereof)and shall retain all records of accounting for at least six years
after the day on which the last outstanding Bond is discharged. However, to the
extent permitted by law, the Corporation may commingle Gross Proceeds of the
Bonds with other money of the Corporation, provided that the Corporation
separately accounts for each receipt and expenditure of Gross Proceeds and the
obligations acquired therewith.
(2) Not less frequently than each Computation Date, the Corporation
shall calculate the Rebate Amount in accordance with rules set forth in section
148(f) of the Code and the Regulations and rulings thereunder. The Corporation
shall maintain such calculations with its official transcript of proceedings relating
to the issuance of the Bonds until six years after the final Computation Date.
(3) As additional consideration for the purchase of the Bonds by the
Purchasers and the loan of the money represented thereby and in order to induce
such purchase by measures designed to insure the excludability of the interest
thereon from the gross income of the owners thereof for federal income tax
purposes, the Corporation shall pay to the United States out of the Bond Fund or
its general fund, as permitted by applicable Texas statute, regulation or opinion of
the Attorney General of the State of Texas, the amount that when added to the
future value of previous rebate payments made for the Bonds equals (i)in the case
of a Final Computation Date as defined in Section 1.148-3(e)(2) of the
Regulations, one hundred percent (100%) of the Rebate Amount on such date;
and (ii) in the case of any other Computation Date, ninety percent (90%) of the
Rebate Amount on such date. In all cases, the rebate payments shall be made at
the times, in the installments, to the place and in the manner as is or may be
required by section 148(f) of the Code and the Regulations and rulings
thereunder, and shall be accompanied by Form 8038-T or such other forms and
information as is or may be required by Section 148(f) of the Code and the
Regulations and rulings thereunder.
77339817.3/11112133 28
(4) The Corporation shall exercise reasonable diligence to assure that
no errors are made in the calculations and payments required by paragraphs (2)
and (3), and if an error is made, to discover and promptly correct such error
within a reasonable amount of time thereafter (and in all events within one
hundred eighty (180) days after discovery of the error), including payment to the
United States of any additional Rebate Amount owed to it, interest thereon, and
any penalty imposed under Section 1.148 3(h)of the Regulations.
(i) Not to Divert Arbitrage Profits. Except to the extent permitted by section 148 of the
Code and the Regulations and rulings thereunder, the Corporation shall not, at any time prior to
the earlier of the Stated Maturity or final payment of the Bonds, enter into any transaction that
reduces the amount required to be paid to the United States pursuant to Subsection (h) of this
Section because such transaction results in a smaller profit or a larger loss than would have
resulted if the transaction had been at arm's length and had the Yield of the Bonds not been
relevant to either party.
(j) Elections. The Corporation hereby directs and authorizes the Chairman of the Board
and the President, Vice President, Secretary and Treasurer of the Corporation, individually or
jointly, to make elections permitted or required pursuant to the provisions of the Code or the
Regulations, as they deem necessary or appropriate in connection with the Bonds, in the
Certificate as to Tax Exemption or similar or other appropriate certificate, form or document.
(k) Bonds Not Hedge Bonds. (1) At the time the original bonds refunded by the Bonds
were issued, the Corporation reasonably expected to spend at least 85% of the spendable
proceeds of such bonds within three years after such bonds were issued and (2) not more than
50% of the proceeds of the original bonds refunded by the Bonds were invested in Nonpurpose
Investments having a substantially guaranteed Yield for a period of 4 years or more.
(1) Current Refunding. The Bonds are being issued exclusively to pay and discharge in
full the Refunded Bonds and such payment of the Refunded Bonds will occur within ninety(90)
days after the issuance of the Bonds.
SECTION 27. Sale of Bonds. The offer of BOKF, NA dba Bank of Texas, Houston,
Texas (the "Purchaser") to purchase the Bonds in accordance with a purchase letter, dated as of
December 12, 2011 (the "Purchase Letter"), attached hereto as Exhibit B and incorporated
herein by reference as a part of this Resolution for all purposes, is hereby accepted and the sale
of the Bonds to the Purchaser is hereby approved and authorized, and the Corporation has
determined and does determine that the terms of such Purchase Letter are in the Corporation's
best interests. The President, Vice President and Secretary of the Corporation are hereby
authorized and directed to sign the acceptance clause of said letter for and on behalf of the
Corporation and as the act and deed of this Board. Delivery of the Bonds to the Purchaser shall
occur as soon as possible upon payment being made therefor in accordance with the terms of
sale.
SECTION 28. Escrow Agreement Approval and Execution. The "Escrow Agreement"
(the "Agreement") by and between the Corporation and BOKF, NA dba Bank of Texas, Fort
Worth, Texas (the "Escrow Agent"), attached hereto as Exhibit C and incorporated herein by
77339817.3/11112133 29
reference as a part of this Resolution for all purposes, is hereby approved as to form and content,
and such Agreement in substantially the form and substance attached hereto, together with such
changes or revisions as may be necessary to accomplish the refunding or benefit the Corporation,
is hereby authorized to be executed by the President, Vice President and Secretary of the
Corporation for and on behalf of the Corporation and as the act and deed of this Board; and such
Agreement as executed by said officials shall be deemed approved by the Board and constitute
the Agreement herein approved.
Furthermore, appropriate officials of the Corporation in cooperation with the Escrow
Agent are hereby authorized and directed to make the necessary arrangements for the purchase of
the escrowed securities referenced in the Agreement and the delivery thereof to the Escrow
Agent on the day of delivery of the Bonds to the Purchaser for deposit to the credit of the
"SPECIAL 2012 EULESS DEVELOPMENT CORPORATION REFUNDING BOND
ESCROW FUND" (the "Escrow Fund"); all as contemplated and provided in V.T.C.A.,
Government Code, Chapter 1207, as amended,this Resolution and the Agreement.
SECTION 29. Proceeds of Sale. Immediately following the delivery of the Bonds,
proceeds of sale in the sum of $3,728,678.18 shall be deposited with the Escrow Agent for
application and disbursement in accordance with the provisions of the Agreement. The balance
of the proceeds of sale of the Bonds shall be expended to pay costs of issuance and any excess
amount budgeted for such purpose shall be deposited to the credit of the Bond Fund.
Additionally, on or immediately prior to the date of the delivery of the Bonds, a
Corporation official listed in Section 42 hereof shall cause to be transferred in immediately
available funds to the Escrow Agent (1) the sum of$21,963.28 from moneys on deposit in the
interest and sinking funds and (2) the sum of$27,463.28 from the Reserve Fund maintained for
the payment of the Refunded Bonds to accomplish the refunding.
SECTION 30. Redemption of Refunded Bonds.
(a) The Series 2002 Refunded Bonds are hereby called for redemption on February 13,
2012, at the price of par and accrued interest to the date of redemption. The Secretary of the
Board is hereby authorized and directed to file a copy of this Resolution, together with a
suggested form of notice of redemption to be sent to bondholders, with U. S. Bank National
Association (successor paying agent/registrar to Wachovia Bank, National Association), in
accordance with the redemption provisions applicable to such bonds; such suggested form of
notice of redemption being attached hereto as Exhibit D and incorporated herein by reference
as a part of this Resolution for all purposes.
(b) The Series 2006 Refunded Bonds are hereby called for redemption on February 13,
2012, at the price of par and accrued interest to the date of redemption. The Secretary of the
Board is hereby authorized and directed to file a copy of this Resolution, together with a
suggested form of notice of redemption to be sent to bondholders, with JPMorgan Chase Bank,
National Association, in accordance with the redemption provisions applicable to such bonds;
such suggested form of notice of redemption being attached hereto as Exhibit E and
incorporated herein by reference as a part of this Resolution for all purposes.
77339817.3/11112133 30
The redemption of the Refunded Bonds being associated with the refunding of the
Refunded Bonds,the approval, authorization and arrangements herein given and provided for the
redemption of the Refunded Bonds on the redemption date designated therefor and in the manner
provided shall be irrevocable upon the issuance and delivery of the Bonds; and the Secretary of
the Board is hereby authorized and directed to make all arrangements necessary to notify the
holders of the Refunded Bonds of the Corporation's decision to redeem the Refunded Bonds on
the date and in the manner herein provided and in accordance with the resolutions authorizing
the issuance of the Refunded Bonds and this Resolution.
SECTION 31. Notices to Holders - Waiver. Wherever this Resolution provides for
notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein
expressly provided)if in writing and sent by United States mail, first class postage prepaid,to the
address of each Holder as it appears in the Security Register.
In any case where notice to Holders is given by mail, neither the failure to mail such
notice to any particular Holders, nor any defect in any notice so mailed, shall affect the
sufficiency of such notice with respect to all other Bonds. Where this Resolution provides for
notice in any manner, such notice may be waived in writing by the Holder entitled to receive
such notice, either before or after the event with respect to which such notice is given, and such
waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Paying Agent/Registrar, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
SECTION 32. Cancellation. All Bonds surrendered for payment,redemption,transfer or
exchange, if surrendered to the Paying Agent/Registrar, shall be promptly canceled by it and, if
surrendered to the Corporation, shall be delivered to the Paying Agent/Registrar and, if not
already canceled, shall be promptly canceled by the Paying Agent/Registrar. The Corporation
may at any time deliver to the Paying Agent/Registrar for cancellation any Bonds previously
certified or registered and delivered which the Corporation may have acquired in any manner
whatsoever, and all Bonds so delivered shall be promptly y canceled by the Paying
Agent/Registrar. All canceled Bonds held by the Paying Agent/Registrar shall be destroyed as
directed by the Corporation.
SECTION 33. Legal Opinion. The Purchasers' obligation to accept delivery of the
Bonds is subject to being furnished a final opinion of Fulbright & Jaworski L.L.P., Attorneys,
Dallas, Texas, approving the Bonds as to their validity, with said opinion to be dated and
delivered as of the date of delivery and payment for the Bonds. A true and correct reproduction
of said opinion is hereby authorized to be printed on the definitive Bonds.
SECTION 34. CUSIP Numbers. CUSIP numbers may be printed or typed on the
definitive Bonds. However, it is expressly provided that the presence or absence of CUSIP
numbers on the definitive Bonds shall be of no significance and shall have no effect on the
legality of such bonds. Furthermore, neither the Corporation nor attorneys approving the Bonds
as to legality are to be held responsible for CUSIP numbers incorrectly printed or typed on the
definitive Bonds.
77339817.3/11112133 31
SECTION 35. Control and Custody of Bonds. The President of the Corporation shall be
and is hereby authorized to take and have charge of all necessary orders and records pending
investigation by the Attorney General of the State of Texas, and shall take and have charge and
control of the Initial Bond(s) pending the approval thereof by the Attorney General, the
registration thereof by the Comptroller of Public Accounts and the delivery thereof to the
Purchasers.
SECTION 36. Benefits of Resolution. Nothing in this Resolution, expressed or implied,
is intended or shall be construed to confer upon any person other than the Corporation, the
Paying Agent/Registrar and the Holders, any right, remedy, or claim, legal or equitable, under or
by reason of this Resolution or any provision hereof, this Resolution and all its provisions being
intended to be and being for the sole and exclusive benefit of the Corporation, the Paying
Agent/Registrar and the Holders.
SECTION 37. Inconsistent Provisions. All orders or resolutions, or parts thereof, which
are in conflict or inconsistent with any provision of this Resolution are hereby repealed to the
extent of such conflict and the provisions of this Resolution shall be and remain controlling as to
the matters contained herein.
SECTION 38. Governing Law. This Resolution shall be construed and enforced in
accordance with the laws of the State of Texas and the United States of America.
SECTION 39. Severability. If any provision of this Resolution or the application thereof
to any circumstance shall be held to be invalid, the remainder of this Resolution and the
application thereof to other circumstances shall nevertheless be valid, and the Board hereby
declares that this Resolution would have been enacted without such invalid provision.
SECTION 40. Construction of Terms. If appropriate in the context of this Resolution,
words of the singular number shall be considered to include the plural, words of the plural
number shall be considered to include the singular, and words of the masculine, feminine or
neuter gender shall be considered to include the other genders.
SECTION 41. Incorporation of Findings and Determinations. The findings and
determinations of the Board contained in the preamble hereof are hereby incorporated by
reference and made a part of this Resolution for all purposes as if the same were restated in full
in this Section.
SECTION 42. Further Procedures. Any one or more of the Chairman of the Board and
the President, Vice President, Secretary and Treasurer of the Corporation are hereby expressly
authorized, empowered and directed from time to time and at any time to do and perform all such
acts and things and to execute, acknowledge and deliver in the name and on behalf of the
Corporation all agreements, instruments, certificates or other documents, whether mentioned
herein or not, as may be necessary or desirable in order to carry out the terms and provisions of
this Resolution and the issuance, sale and delivery of the Bonds. In addition, prior to the initial
delivery of the Bonds, the Chairman of the Board and the President, Vice President, Secretary
and Treasurer of the Corporation or Bond Counsel to the Corporation are each hereby authorized
and directed to approve any changes or corrections to this Resolution or to any of the documents
authorized and approved by this Resolution: (i) in order to cure any ambiguity, formal defect, or
77339817.3/11112133 32
omission in the Resolution or such other document; or (ii) as requested by the Attorney General
of the State of Texas or his representative to obtain the approval of the Bonds by the Attorney
General. In the event that any officer of the Corporation whose signature shall appear on any
document shall cease to be such officer before the delivery of such document, such signature
nevertheless shall be valid and sufficient for all purposes the same as if such officer had
remained in office until such delivery.
SECTION 43. Public Meeting. It is officially found, determined, and declared that the
meeting at which this Resolution is adopted was open to the public and public notice of the time,
place, and subject matter of the public business to be considered at such meeting, including this
Resolution,was given, all as required by V.T.C.A., Government Code, Chapter 551, as amended.
SECTION 44. Effective Date. This Resolution shall be in force and effect from and after
its passage on the date shown below.
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77339817.3/11112133 33
PASSED AND ADOPTED, this December 12,2011.
EULESS DEVELOPMENT CORPORATION
AL _
Chairm. /Board of Directors
ATTEST:
A[L! _
S-- etary
(Corporate Seal)
77339817.2/08013523 S-1